<PAGE>
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 June 30, 1998
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number: 0-25180
CKF Bancorp, Inc.
--------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 61-1267810
- ------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
340 West Main Street, Danville, Kentucky 40422
- ---------------------------------------- -------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (606) 236-4181
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 ninety days.
Yes X No
--- ---
As of August 6, 1998, 915,955 shares of the registrant's common stock were
issued and outstanding.
Page 1 of 15 Pages Exhibit Index at Page N/A
---
<PAGE>
CONTENTS
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets as of June 30, 1998 (unaudited) and
December 31, 1997 ............................................ 3
Consolidated Statements of Income for the Three-Month Periods
Ended June 30, 1998 and 1997 (unaudited) and the
Six-Month Periods Ended June 30, 1998 and 1997
(unaudited) .................................................. 4
Consolidated Statement of Changes in Stockholders' Equity for the
Six Month Period Ended June 30, 1998 (unaudited) ............. 5
Consolidated Statements of Cash Flows for the Six-Month
Periods Ended June 30, 1998 and 1997 (unaudited) ............. 6
Notes to Consolidated Financial Statements ........................ 7
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations ........................................ 9
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
SIGNATURES
<PAGE>
CKF BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
--------------------
<TABLE>
<CAPTION>
As of As of
June 30, December 31,
1998 1997
--------------- ----------------
<S> <C> <C>
ASSETS
Cash and due from banks $ 334,506 $ 134,032
Interest bearing deposits 3,089,671 3,139,525
Investment securities:
Securities available-for-sale 620,400 551,892
Securities held-to-maturity 1,596,042 2,152,020
Loans receivable, net 56,084,891 55,894,811
Accrued interest receivable 424,338 430,290
Office property and equipment, net 563,915 548,923
Other assets 45,133 13,854
--------------- ---------------
Total assets $ 62,758,896 $ 62,865,347
=============== ===============
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits $ 46,290,079 $ 43,253,068
Deferred income taxes 337,106 313,814
Advance from Federal Home Loan Bank 2,171,181 5,213,782
Advance payment by borrowers for taxes and insurance 88,161 30,188
Other liabilities 336,857 291,792
--------------- ---------------
Total liabilities 49,223,384 49,102,644
--------------- ---------------
Stockholders' equity:
Common stock, $.01 par value, 4,000,000 shares authorized;
1,000,000 shares issued 10,000 10,000
Additional paid-in capital 9,595,534 9,638,682
Retained earnings, substantially restricted 7,190,089 7,004,137
Treasury stock, 84,045 and 50,000 shares, respectively, at cost (1,651,464) (986,388)
Stock Option Trust, 72,600 and 83,000 shares, respectively, at cost (1,414,433) (1,619,433)
Accumulated other comprehensive income 400,932 355,717
Unearned Employee Stock Ownership Plan (ESOP) shares (595,146) (640,012)
--------------- ---------------
Total shareholder's equity 13,535,512 13,762,703
--------------- ---------------
Total liabilities and shareholders' equity $ 62,758,896 $ 62,865,347
=============== ===============
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE>
CKF BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
----------------------
<TABLE>
<CAPTION>
For the Three-Month Periods For the Six-Month Periods
Ended June 30, Ended June 30,
------------------------------- ------------------------------
1998 1997 1998 1997
-------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Interest income:
Interest on loans ................... $1,093,666 $1,103,365 2,206,652 $2,154,929
Interest and dividends on investments 31,956 37,488 66,183 81,870
Other interest income ............... 28,466 13,639 50,839 31,011
---------- ---------- ---------- ----------
Total interest income ............. 1,154,088 1,154,492 2,323,674 2,267,810
---------- ---------- ---------- ----------
Interest expense:
Interest on deposits ................ 595,988 541,838 1,163,843 1,079,667
Other interest expense .............. 36,074 38,552 84,560 64,158
---------- ---------- ---------- ----------
Total interest expense ............ 632,062 580,390 1,248,403 1,143,825
---------- ---------- ---------- ----------
Net interest income .................... 522,026 574,102 1,075,271 1,123,985
Provision for loan losses .............. 6,000 6,000 12,000 6,000
---------- ---------- ---------- ----------
Net interest income after
provision for loan losses ......... 516,026 568,102 1,063,271 1,117,985
---------- ---------- ---------- ----------
Non-interest income:
Loan and other service fees ......... 20,045 14,000 38,384 27,942
Gain on sale of investments ......... 420,575 420,575
Other, net .......................... 1,220 716 1,760 1,327
---------- ---------- ---------- ----------
Total non-interest income ......... 21,265 435,291 40,144 449,844
---------- ---------- ---------- ----------
Non-interest expense:
Compensation and benefits ........... 132,002 137,210 273,216 281,438
Federal insurance premium ........... 6,827 8,850 13,544 17,700
State franchise tax ................. 20,645 12,273 26,461 24,547
Occupancy expenses, net ............. 6,411 10,592 19,642 22,945
Data processing expenses ............ 19,449 13,051 28,857 23,999
Legal fees .......................... 11,761 9,167 25,393 13,219
Loss on real estate owned ........... 5,004 13 5,004 41,813
Other operating expenses ............ 68,374 61,212 124,082 115,074
---------- ---------- ---------- ----------
Total non-interest expense ........ 270,473 252,368 516,199 540,735
---------- ---------- ---------- ----------
Income before income tax expense ....... 266,818 751,025 587,216 1,027,094
Provision for income taxes ............. 91,613 255,348 200,240 349,212
---------- ---------- ---------- ----------
Net income ............................. $ 175,205 $ 495,677 $ 386,976 $ 677,882
========== ========== ========== ==========
Earnings per common share .............. $ .22 $ .58 $ .49 $ .79
========== ========== ========== ==========
Earnings per common share
-assuming dilution .................. $ .22 $ .56 $ .48 $ .77
========== ========== ========== ==========
</TABLE>
4
<PAGE>
CKF BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
for the six month period ended June 30, 1998
(unaudited)
<TABLE>
<CAPTION>
Accumulated
Additional Other Stock Unearned Total
Common Paid-in Retained Comprehensive Treasury Option ESOP Stockholders'
Stock Capital Earnings Income Stock Trust Shares Equity
--------- ----------- ---------- ------------- ----------- ------------ ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1997 $ 10,000 $ 9,638,682 $7,004,138 $ 355,717 $ (986,388) $(1,619,433) $ (640,012) $13,762,704
-----------
Comprehensive income:
Net income 386,976 386,976
Other comprehensive income,
net of tax unrealized
gains on securities 45,215 45,215
-----------
Total comprehensive income 432,191
Dividend declared (201,025) (201,025)
ESOP shares earned 25,352 44,866 70,218
Purchase of common stock,
34,045 shares (665,076) (665,076)
Shares issued upon exercise
of options (68,500) 205,000 136,500
--------- ----------- ---------- ------------- ----------- ------------ ---------- -----------
Balance, June 30, 1998 $ 10,000 $ 9,595,534 $7,190,089 $ 400,932 $(1,651,464) $ (1,414,433) $ (595,146) $13,535,512
========= =========== ========== ============= =========== ============ ========== ===========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
5
<PAGE>
CKF BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
-----------------------------
<TABLE>
<CAPTION>
For the Six-Month Periods
Ended June 30
--------------------------
1998 1997
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 386,976 $ 677,882
Adjustments to reconcile net income to net cash
provided by operating activities:
Provision for loan losses 12,000 6,000
Loss on real estate owned 5,004 41,813
Amortization of loan fees (7,539) (4,655)
ESOP benefit expense 51,005 50,531
Realized gain on sale of investment (420,575)
Provision for depreciation 13,740 13,125
FHLB stock dividend (18,700) (17,100)
Amortization of investment premium 1,645 1,546
Change in:
Interest receivable 5,952 (46,422)
Other liabilities and federal income taxes payable 47,271 (12,835)
Prepaid expense (31,279) (38,258)
Interest payable (2,207) 14,593
----------- -----------
Net cash provided by operating activities 463,868 265,645
----------- -----------
Cash flows from investing activities:
Loan originations and principal payment on loans, net (233,169) (1,927,805)
Purchase of office equipment (28,733) (37,743)
Proceeds from sale of real estate owned 33,627
Matured held-to-maturity securities 500,000 500,000
Proceeds from sale of securities available-for-sale 433,500
Principle repayment on mortgage-backed securities 73,033 34,936
----------- -----------
Net cash provided (used) by investing activities 344,758 (997,112)
----------- -----------
Cash flows from financing activities:
Net increase (decrease) in demand deposits, NOW accounts
and savings accounts 1,059,638 87,952
Net increase (decrease) in certificates of deposit 1,977,373 (706,819)
Net increase (decrease) in custodial accounts 57,973 64,349
Proceeds from FHLB advances 2,000,000
Payments on FHLB advances (3,042,601) (18,871)
Dividends paid (201,024) (1,046,689)
Purchase of common stock (665,076) (38,350)
Additional principal payment on ESOP loan 19,211
Proceeds from exercise of stock option 136,500
----------- -----------
Net cash provided by financing activities (658,006) 341,572
----------- -----------
Increase (decrease) in cash and cash equivalents 150,620 (389,895)
Cash and cash equivalents, beginning of period 3,273,557 2,219,592
----------- -----------
Cash and cash equivalents, end of period $ 3,424,177 $ 1,829,697
=========== ===========
Supplemental disclosures of cash flow information:
Cash paid for income taxes $ 187,219 $ 389,708
=========== ===========
Cash paid for interest $ 1,250,610 $ 1,129,232
=========== ===========
Mortgage loans originated to finance sale of foreclosed real estate $ 15,000
===========
</TABLE>
6
<PAGE>
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
CKF Bancorp, Inc. (the "Company") was formed in August 1994 at the
direction of Central Kentucky Federal Savings Bank (the "Bank") to become
the holding company of the Bank upon the conversion of the Bank from mutual
to stock form (the "Conversion"). Since the Conversion, the Company's
primary assets have been the outstanding capital stock of the Bank, cash on
deposit with the Bank, and a note receivable from the Company's Employee
Stock Ownership Plan ("ESOP"), and its sole business is that of the Bank.
Accordingly, the consolidated financial statements and discussions herein
include both the Company and the Bank. On December 29, 1994, the Bank
converted from mutual to stock form as a wholly owned subsidiary of the
Company. In conjunction with the Conversion, the Company issued 1,000,000
shares of its common stock to the public.
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles
("GAAP") for interim financial information and with the instructions to
Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not
include all of the information and footnotes required by GAAP for complete
financial statements. In the opinion of management, all adjustments
(consisting of only normal recurring accruals) necessary for fair
presentation have been included. The results of operations and other data
for the six month period ended June 30, 1998 are not necessarily indicative
of results that may be expected for the entire fiscal year ending December
31, 1998.
2. Earnings Per Share
Earnings per common share for the three month periods ended June 30, 1998
and 1997 amounted to $0.22 and $0.58 per share, respectively, based on
weighted average common stock shares outstanding of 781,774 and 857,719
shares respectively. Earnings per common share, assuming dilution for
common stock equivalents for the three month periods ended June 30, 1998
and 1997 amounted to $0.22 and $0.56 per common share, based on weighted
average common shares outstanding after dilutive effect of 806,086 and
885,004, respectively. Earnings per common share for the six month periods
ended June 30, 1998 and 1997 amounted to $0.49 and $0.79 per share,
respectively, based on weighted average common stock shares outstanding of
787,041 and 858,110, respectively. Earnings per common share, assuming
dilution for common stock equivalents for the six month periods ended June
30, 1998 and 1997 amounted to $0.48 and $0.77, based on weighted average
common shares outstanding after dilutive effect of 812,368 and 884,306.
7
<PAGE>
3. Regulatory Capital
At June 30, 1998, the Bank's regulatory capital levels exceeded each of the
three regulatory capital requirements. The following table reconciles the
Bank's stockholder equity at June 30, 1998 to its regulatory capital
requirements.
<TABLE>
<CAPTION>
Regulatory Capital
------------------------------
Core Risk-Based
Capital Capital
------------- -------------
(In thousands)
<S> <C> <C>
Stockholder equity $ 11,058 $ 11,058
Net unrealized appreciation on investment
securities available-for-sale (401) (401)
General allowance for loan losses - 136
------------- -------------
Regulatory capital 10,657 10,793
Minimum capital requirement 2,486 2,918
------------- -------------
Excess regulatory capital $ 8,171 $ 7,875
============= =============
Minimum capital requirement as a percentage of assets 4.0% 8.0%
Regulatory capital in excess of minimum capital
requirements as a percentage of assets 13.02% 21.58%/1/
</TABLE>
- -----------------------------
/1/ Based on risk weighted assets.
4. Dividends
A cash dividend of $0.25 per share was paid on February 10, 1998 to
stockholders of record as of January 28, 1998. The total dividends paid by
the Company for the six month period ended June 30, 1998 amounted to
$201,024.
5. Common Stock
During the six months ended June 30, 1998, options to acquire 10,400 shares
at $13.125 per share were exercised with the Company receiving total
proceeds of $136,500. In addition, the Company purchased 34,045 shares of
treasury stock at a cost of $665,076 during the six months ended June 30,
1998.
8
<PAGE>
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Financial Condition
Total assets decreased approximately $106,000, or .2%, from $62.9 million at
December 31, 1997 to $62.8 million at June 30, 1998. The net decrease in assets
includes a $190,000, or .3%, increase in net loans receivable, a $151,000, or
4.6%, increase in cash and interest bearing deposits and a $40,000, or 4.1%,
increase in other assets offset by a $487,000, or 18.0%, decrease in investment
securities.
The Company's aggregate investment securities portfolio decreased $487,000, or
18.0% to $2.2 million at June 30, 1998. Securities classified as
available-for-sale and recorded at market value per SFAS No. 115 increased
$69,000 due solely to the increase in the market value of such securities.
Securities held-to-maturity decreased $556,000 due to the maturity of a Treasury
note and principle repayments offset by premium amortization.
Under SFAS No. 115, unrealized gains or losses on securities available-for-sale
are recorded net of deferred income tax as a separate component of stockholders'
equity. At June 30, 1998, the Company included net unrealized gains of
approximately $401,000 in stockholders' equity. At December 31, 1997, the
Company included net unrealized gains of approximately $356,000 in stockholders'
equity. Per SFAS No. 115, such gains or losses will not be reflected as a charge
or credit to earnings until the underlying securities are sold, and then only to
the extent of the amount of gain or loss, if any, actually realized at the time
of sale.
Loans receivable increased by $190,000, or .3%, from $55.9 million at December
31, 1997 to $56.1 million at June 30, 1998 as management continued its efforts
to be competitive in meeting the loan demand in the Bank's market area.
Deposits increased by $3.0 million, or 7.0%, to $46.3 million at June 30, 1998.
This increase reflects the Company's competitively priced product line within
the local market area.
Results of Operations for the Three Months Ended June 30, 1998 and 1997
Net Income
Net income for the three months ended June 30, 1998 was $175,000 compared to
$496,000 for the corresponding period in 1997, a decrease of $320,000, or 64.6%.
The decrease resulted primarily from a decrease in net interest expense of
$52,000, a decrease in non-interest income of $414,000, and an increase in
non-interest expenses of $18,000 offset by a decrease of $164,000 in income tax
expense.
Interest Income
Interest income totaled 7.5% of average assets for the quarter ended June 30,
1998 compared to 7.8% for the quarter ended June 30, 1997. Interest income was
$1.2 million for both quarters ended June 30, 1998 and 1997. Interest income
remained comparable as the effect of the increase of $1.8 million in the average
earning assets was offset by the impact of the decrease of 25 basis points in
the effective rate earned on interest bearing assets.
9
<PAGE>
Interest Expense
Interest expense totaled $632,000 and $580,000 for the six months ended June 30,
1998 and 1997, respectively. The increase in interest expense of $52,000 or
8.9%, for the three months ended June 30, 1998 as compared to the same period
for 1997 was due to an increase in average interest rates paid on deposits from
5.0% to 5.2%, plus an increase of $2.6 million in interest bearing liabilities
for the quarter ended June 30, 1998 compared to the same period in 1997.
Provision for Loan Losses
The Bank established a provision for loan losses of $6,000 for the three month
periods ended June 30, 1998 and 1997. Management established the Bank's existing
level of its allowance for loan losses based upon its analysis of various
factors, including the market value of the underlying collateral, composition of
the loan portfolio, the Bank's historical loss experience, delinquency trends,
and prevailing and projected economic conditions in the Bank's market area.
Non-Interest Income
Non-interest income amounted to $21,000 and $435,000 for the three months ended
June 30, 1998 and 1997, respectively. The decrease was due primarily to a
$420,000 gain resulting from the sale of investments classified as
available-for-sale in the 1997 period.
Non-Interest Expense
Non-interest expense totaled $270,000 and $252,000 for the three months ended
June 30, 1998 and 1997, respectively, an increase of $18,000, or 7.2%, and such
expense amounted to 1.7% of average assets for both periods. The increase was
primarily due to an increase of $8,000 in state franchise taxes, an increase of
$5,000 in the loss on real estate owned plus immaterial increases totaling
$5,000 in various other non-interest expense categories.
Income Taxes
The provision for income taxes for the three months ended June 30, 1998 and 1997
was $91,000 and $255,000, respectively, which, as a percentage of income before
income taxes was 34% for both periods.
Results of Operations for the Six Months Ended June 30, 1998 and 1997
Net Income
Net income for the six months ended June 30, 1998 was $387,000, as compared to
$678,000 for the corresponding period in 1997, a decrease of $291,000, or 42.9%.
The decrease resulted primarily from a decrease of $55,000 in net interest
income and a decrease of $410,000 in non-interest income offset by a decrease of
$25,000 in non-interest expenses plus a decrease of $149,000 in income tax
expense.
10
<PAGE>
Interest Income
Interest income totaled $2.3 million for the six months ended June 30, 1998 and
1997. The increase in interest income of $56,000, or 2.5%, for the six months
ended June 30, 1998 as compared to the same period for 1997 was due primarily to
an increase of $2.0 million in the average balance of interest earning assets.
Interest Expense
Interest expense totaled $1.2 million and $1.1 million for the six months ended
June 30, 1998 and 1997, respectively. The increase in interest expense of
$105,000, or 9.1%, for the six months ended June 30, 1998 as compared to the
same period in 1997 was due to an increase of 16 basis points in the average
interest rate paid on interest bearing liabilities, plus an increase of $2.6
million in the balance of average deposits during the six months ended June 30,
1998 compared to the same period in 1997.
Provision for Loan Losses
The Bank established a provision for loan losses of $12,000 and $6,000 for the
six month period ended June 30, 1998 and 1997, respectively. Management
considers many factors in determining the necessary level of the allowance for
loan losses, including an analysis of specific loans in the portfolio, estimated
value of the underlying collateral, assessment of general trends in the real
estate market, delinquency trends, prospective economic and regulatory
conditions, inherent loss in the loan portfolio, and the relationship of the
allowance for loan losses to outstanding loans.
Non-Interest Income
Non-interest income amounted to $40,000 and $450,000 for the six months ended
June 30, 1998 and 1997, respectively. The decrease was due primarily to a
$420,000 gain resulting from the sale of investments classified as
available-for-sale in the 1997 period.
Non-Interest Expense
Non-interest expense totaled $516,000 and $541,000 for the six months ended June
30, 1998 and 1997, respectively, a decrease of $25,000, or 4.5%, and such
expense amounted to 1.6% and 1.8% of average assets for the six months ended
June 30, 1998 and 1997, respectively. The decrease was primarily due to a
decrease of $37,000 in the loss on real estate owned offset by a $12,000
increase in legal fees. The increase of $12,000 in legal fees was attributed to
professional services provided in connection with the Bank's exploration of
strategic capital employment.
11
<PAGE>
Income Taxes
The provision for income taxes for the six months ended June 30, 1998 and 1997
was $200,000 and $349,000, respectively, and, as a percentage of income before
income taxes was 34% for both periods.
<TABLE>
<CAPTION>
June 30, December 31,
1998 1997
------------- ---------
(amounts in thousands)
<S> <C> <C>
Loans accounted for on a non-accrual basis:1
Real Estate:
Residential $ 32 $ 54
Commercial
Consumer 18 12
------------- -------------
Total $ 50 $ 66
============= =============
Accruing loans which are contractually past due 90 days or more:
Real Estate:
Residential 279 227
Commercial
Consumer 9
------------- -------------
Total 288 227
============= =============
Total of loans accounted for as non-accrual or as accruing past
due 90 days or more $ 338 $ 293
============= =============
Percentage of total loans .59% .52%
============= =============
Other non-performing assets2 $ - $ -
============= =============
Restructured loans $ - $ -
============= =============
</TABLE>
/1/ Non-accrual status denotes any mortgage loan past due 90 days and whose loan
balance, plus accrued interest exceeds 90% of the estimated loan collateral
value, and any consumer or commercial loan more than 90 days past due. Payments
received on a non-accrual loan are either applied to the outstanding principal
balance or recorded as interest income, or both, depending on assessment of the
collectibility of the loan.
/2/ Other non-performing assets represent property acquired by the Bank through
foreclosure or repossession. Such property is carried at the lower of its fair
market value or the principal balance of the related loan.
During the six months ended June 30, 1998, additional interest income of $5,038
would have been recorded on loans accounted for on a non-accrual basis if the
loans had been current throughout the year. Interest on such loans actually
included in income during the six months ended June 30, 1998 totaled $987.
At June 30, 1998, there were no loans identified by management, which were not
reflected in the preceding table, but as to which known information about
possible credit problems of borrowers caused management to have serious doubts
as to the ability of the borrowers to comply with present loan repayment terms.
Liquidity and Capital Resources
The Bank's principal sources of funds for operations are deposits from its
primary market area, principal and interest payments on loans, and proceeds from
maturing investment securities. The principal uses of funds by the Bank include
the origination of mortgage and consumer loans and the purchase of investment
securities.
12
<PAGE>
The Bank is required by current OTS regulations to maintain specified liquid
assets of at least 4% of its net withdrawable accounts plus short-term
borrowings. Short-term liquid assets (those maturing in one year or less) may
not be less than 1% of the Bank's liquidity base. During the first six months of
fiscal year 1998, the Bank satisfied all regulatory liquidity requirements, and
management believes that the liquidity levels maintained are adequate to meet
potential deposit outflows, loan demand, and normal operations.
The Bank must satisfy two capital standards, as set by the OTS. These standards
include a ratio of core capital to adjusted total assets of 4.0%, and a
combination of core and "supplementary" capital equal to 8.0% of risk-weighted
assets. The Bank has exceeded all regulatory capital requirements as of June 30,
1998.
At June 30, 1998, the Bank had outstanding commitments to originate loans
totaling $1.6 million, excluding $745,000 in approved but unused home equity
lines of credit. Management believes that the Bank's sources of funds are
sufficient to fund all of its outstanding commitments. Certificates of deposits
which are scheduled to mature in one year or less from June 30, 1998 totaled
$22.6 million. Management believes that a significant percentage of such
deposits will remain with the Bank.
13
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings None
Item 2. Changes in Securities and Use of Proceeds None
Item 3. Defaults Upon Senior Securities None
Item 4. Submission of Matters to a Vote of Security Holders
The Company's Annual Meeting of Stockholders was held on April 21,
1998, 821,364 shares of CKF Bancorp, Inc. common stock were
represented at the Annual Meeting in person or by proxy.
Stockholders voted in favor of the election of three nominees for
director. The voting results for each nominee were as follows:
Votes in Votes
Nominee Favor of Election Withheld
------------------- ------------------- ------------------
W. Irvine Fox, Jr. 818,964 2,400
Warren O. Nash 818,964 2,400
John H. Stigall 818,964 2,400
Item 5. Other Information None
Item 6. Exhibits and Reports on Form 8-K
(a) The following Exhibit is filed herewith:
Exhibit 27 Financial Data Schedule
(b) No reports on Form 8-K were filed during the quarter ended
June 30, 1998.
14
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CKF Bancorp, Inc.
Date: August 6, 1998 -------------------------------------------------------
John H. Stigall, President and Chief Executive Officer
(Duly Authorized Officer)
Date: August 6, 1998 -------------------------------------------------------
Ann L. Hooks, Vice President and Treasurer
(Principal Financial and Accounting Officer)
15
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> JUN-30-1998
<CASH> 334
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0
0
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</TABLE>
