<PAGE>
UNITED STATES
SECURITY AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
{X} QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
or
{ } TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from_____________________to________________________
Commission File Number: 0-24896
Home Building Bancorp, Inc.
(Exact name of registrant as specified in its charter)
Indiana
(State or other jurisdiction of incorporation or organization)
35-1935840
(I.R.S. Employer identification No.)
200 East VanTrees Street, Washington, Indiana 47501
(Address of principal executive offices) (Zip Code)
(812) 254-2641
(Registrant's telephone number, including area code)
N/A
(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 shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing for
the past 90 days. {X}Yes { } No
As of May 14, 1998 there were 331,660 shares of the Registrant's common stock
issued and outstanding. Indicate the number of shares outstanding of each of
the issuer's classes of common stock as of the latest practicable date.
Transitional Small Business Disclosure Format (check one):
{ } Yes {X} No
<PAGE>
HOME BUILDING BANCORP, INC.
INDEX
Part I. Financial Information Page
Item 1. Financial Statements
Consolidated Statements of Financial Condition at March 31, 1998 1
and September 30, 1997
Consolidated Statements of Income for the three and six months
ended March 31, 1998 and 1997 2
Consolidated Statements of Cash Flows for the six months ended
March 31, 1998 and 1997 3
Notes to Consolidated Financial Statements 4
Item 2. Management's Discussion and Analysis of Financial Condition 7
and Results of Operations
Part II. Other Information 12
Signatures 13
Index of Exhibits 14
<PAGE>
<TABLE>
Home Building Bancorp, Inc.
Washington, Indiana
Consolidated Statements of Financial Condition
<CAPTION>
(Unaudited)
March. 31, Sept. 30,
1998 1997
ASSETS
<S> <C> <C>
Cash and due from banks $ 1,416,673 $ 1,494,118
Interest-bearing deposits with banks 2,679,639 2,521,578
Securities available-for-sale 6,613,964 7,483,447
Securities held-to-maturity, fair market value of
$293,000 at March 31, and $349,000
at Sept. 30 289,874 344,257
Loans receivable, net of allowance for loan losses of
$85,000 at March 31, and $80,680 at Sept. 30 32,505,488 28,582,610
Insurance receivable 276,940 240,444
Accrued interest receivable 200,860 210,256
Premises and equipment 773,514 783,967
Other assets 77,909 89,075
Total assets $ 44,834,861 $ 41,749,752
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Savings and NOW deposits $ 11,185,503 $ 10,880,043
Other time deposits 20,759,398 20,637,490
Total deposits 31,944,901 31,517,533
Advances from Federal Home Loan Bank 6,500,341 4,000,341
Accrued expenses and other liabilities 327,670 338,947
Total liabilities 38,772,912 35,856,821
Shareholders' equity:
Common stock, $.01 par value, 1 million shares
authorized, 331,660 issued and outstanding 3,317 3,317
Additional paid-in capital 3,069,595 3,046,415
Treasury stock, at cost (345,000) (345,000)
Retained earnings 3,556,281 3,449,876
Net unrealized gain on available-for-sale securities,
net of deferred tax of $14,404 at March 31, and
$8,451 at Sept. 30 21,606 12,606
Unearned ESOP & recognition and retention shares (243,850) (274,283)
Total shareholders' equity 6,061,949 5,892,931
Total liabilities and shareholders' equity $ 44,834,861 $ 41,749,752
<FN>
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
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<PAGE>
<TABLE>
Home Building Bancorp, Inc.
Washington, Indiana
Consolidated Statements of Income
<CAPTION>
(Unaudited)
Three months ended Six months ended
March 31, March 31,
1998 1997 1998 1997
Interest income:
<S> <C> <C> <C> <C>
Loans receivable $ 624,071 $ 612,069 $ 1,235,989 $ 1,195,691
Investments 45,164 40,636 103,878 74,425
Mortgage-backed securities 75,929 106,182 154,115 208,861
Deposits with other banks 70,215 95,713 129,142 170,979
Total interest income 815,379 854,600 1,623,124 1,649,956
Interest expense:
Deposits 374,984 417,491 753,355 813,362
Other borrowed funds 66,965 52,650 124,223 108,639
Total interest expense 441,949 470,141 877,578 922,001
Net interest income 373,430 384,459 745,546 727,955
Provision for loan losses 5,000 - 7,000 -
Net interest income after provision
for loan losses 368,430 384,459 738,546 727,955
Noninterest income:
Gain on sale of assets 9,803 2,954 17,112 3,453
Customer service fees 45,515 32,220 70,512 58,915
Total other income 55,318 35,174 87,624 62,368
Noninterest expenses:
Salaries and employee benefits 145,183 146,005 296,803 261,323
Occupancy and equipment 34,595 35,461 70,630 74,145
Deposit insurance premium 5,062 2,003 10,707 21,392
Computer expense 14,381 15,315 27,894 29,177
Service fees 13,860 12,350 27,708 24,537
Advertising expense 14,552 12,822 29,282 26,115
Professional fees 22,535 20,488 38,365 26,038
Other expense 30,757 23,769 81,896 66,923
Total other expenses 280,925 268,213 583,285 529,650
Income before income taxes 142,823 151,420 242,885 260,673
Income tax expense 58,457 56,462 89,730 97,483
Net income $ 84,366 $ 94,958 $ 153,155 $ 163,190
Basic earnings per share of common stock $ 0.29 $ 0.33 $ 0.53 $ 0.58
Weighted average shares outstanding 290,171 283,542 289,573 282,880
Diluted earnings per share of
common stock $ 0.28 $ 0.33 $ 0.52 $ 0.57
Diluted weighted average share outstanding 296,208 287,164 295,610 286,502
<FN>
See notes to consolidated financial statements.
</TABLE>
- -2-
<PAGE>
<TABLE>
Home Building Bancorp, Inc.
Washington, Indiana
Consolidated Statements of Cash Flows
<CAPTION>
(Unaudited)
Six months ended March 31,
1998 1997
Cash flows from operating activities:
<S> <C> <C>
Net income $ 153,155 $ 163,190
Adjustments to reconcile net income to net cash
provided by (used by) operating activities:
Depreciation and amortization 19,769 20,627
Non cash compensation 53,613 -
Other gains and losses, net (9,803) -
Net realized gains on available-for-sale securities (7,309) (2,896)
Increase in insurance receivable (36,496) -
(Increase) decrease in accrued interest receivable 9,396 (379)
Decrease in accrued expenses and other liabilities (17,230) (84,214)
Decrease in other assets 20,969 84,081
Provision for loan loss 7,000 -
Total adjustments 39,909 17,219
Net cash provided by operating activities 193,064 180,409
Cash flows from investing activities:
Net increase in interest-bearing deposits with banks (158,061) (4,166,397)
Purchases of available-for-sale securities (957,647) (1,141,435)
Proceeds from maturities of
available-for-sale securities 1,590,739 697,100
Proceeds from sales of available-for-sale securities 258,653 646,422
Proceed from maturities of held-to-maturity securities 54,383 63,623
Net increase in loans (3,929,878) (86,922)
Net purchases of premises and equipment (9,316) (12,498)
Net cash used in investing activities (3,151,127) (4,000,107)
Cash flows from financing activities:
Net increase in savings and NOW deposit accounts 305,460 1,362,385
Net increase in time deposits 121,908 3,120,273
Net decrease in securities sold under
agreements to repurchase - (273,951)
Proceeds from Federal Home Loan Bank advances 2,500,000 -
Dividends paid (46,750) (48,250)
Net cash provided by financing activities 2,880,618 4,160,457
Net increase (decrease) in cash and due from banks (77,445) 340,759
Cash and due from banks at beginning of period 1,494,118 1,428,754
Cash and due from banks at end of period $ 1,416,673 $ 1,769,513
Interest paid $ 868,079 $ 919,651
Income taxes paid $ 148,931 $ -
<FN>
See notes to consolidated financial statements.
</TABLE>
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<PAGE>
Home Building Bancorp, Inc.
Notes to Consolidated Financial Statements
March 31, 1998 and 1997
Note 1: Basis of Presentation
The unaudited information for the three and six months ended March 31, 1998
and March 31, 1997, includes the results of operations of Home Building
Bancorp, Inc. (the "Company") and its wholly owned subsidiary Home Building
Savings Bank, FSB (the "Bank"). In the opinion of management of the Company,
the financial statements reflect all adjustments (consisting only of normal
recurring adjustments) necessary to present fairly the consolidated financial
statements. These interim financial statements should be read in conjunction
with the Company's most recent annual financial statements and footnotes
included in the annual report of Home Building Bancorp, Inc. dated September
30, 1997. The results of the period presented are not necessarily
representative of the results of operations and cash flows which may be
expected for the entire year.
Note 2: Principles of Consolidation
The consolidated financial statements include the accounts of Home Building
Bancorp, Inc., Home Building Savings Bank, FSB, and the Bank's subsidiary. All
significant inter-company balances and transactions have been eliminated in
consolidation.
Note 3: Stock Conversion
On February 7, 1995, Home Building Bancorp, Inc. began trading as a public
company on the Nasdaq SmallCap Market. The Company issued 322,000 shares,
$.01 par value common stock, for proceeds of $2,858,862 net expenses of
approximately $361,000. The Bank converted to a federal stock savings
bank following the formation of the holding company and received proceeds
of $1,432,853 in exchange for all its common stock. This transaction was
accounted for using historical cost in a manner similar to that in a pooling
of interests. In February 1998, the Corporation moved its stock listing from
the NASDAQ SmallCap Market to NASDAQ's Electronic Bulletin Board.
Note 4: Earnings Per Common Share
Basic earnings of $0.29 per common share for the three month period and $0.53
for the six month period ended March 31, 1998, were computed by dividing net
income by the weighted average number of shares outstanding during the
quarter, less Employee Stock Ownership Plan (ESOP) shares and Recognition
and Retention Plan (RRP) shares not committed to be released. The weighted
average number of shares outstanding for the periods was 290,171 and 289,573,
respectively. Dilutive earnings per share is consistent with that of basic
earnings per share while giving effect to all dilutive potential common
shares that were outstanding during the period. Earnings, assuming dilution,
for the most recent three-month period were $0.28 per share and $0.52 for the
six-month period ended March 31, 1998. A reconciliation of both numerators
and denominators of the per share calculations follows:
- -4-
<PAGE>
Home Building Savings Bank, FSB
Notes to Consolidated Financial Statements
March 31, 1998 and 1997
Note 4: Earnings Per Common Share, continued
Income Shares Per-Share
(Numerator) (Denominator) Amount
For the Three Months Ended March 31, 1998
Basic EPS,
Income available to common shareholders $84,366 290,171 $0.29
Effect of dilutive securities:
Incentive stock option plan shares 6,037
Diluted EPS
Income available to common shareholders+
assumed conversions $84,366 296,208 $0.28
For the Six Months Ended March 31, 1998
Basic EPS,
Income available to common shareholders $153,155 289,573 $0.53
Effect of dilutive securities:
Incentive stock option plan shares 6,037
Diluted EPS
Income available to common shareholders+
assumed conversions $153,155 295,610 $0.52
For the Three Months Ended March 31, 1997
Basic EPS,
Income available to common shareholders $94,958 283,542 $0.33
Effect of dilutive securities:
Incentive stock option plan shares 3,622
Diluted EPS
Income available to common shareholders+
assumed conversions $94,958 287,164 $0.33
For the Six Months Ended March 31, 1997
Basic EPS,
Income available to common shareholders $163,190 282,880 $0.58
Effect of dilutive securities:
Incentive stock option plan shares 3,622
Diluted EPS
Income available to common shareholders+
assumed conversions $163,190 286,502 $0.57
- -5-
<PAGE>
Home Building Savings Bank, FSB
Notes to Consolidated Financial Statements
March 31, 1998 and 1997
(Concluded)
Note 5: Allowance for Loan Losses and Loan Loss Provision
The allowance for loan losses increased $4,000 to $85,000 for the six-month
period ended March 31, 1998. Activity in the allowance for loan losses was
as follows:
For the six months ended March 31,
1998 1997
Beginning $ 81,000 $ 77,000
Provision 7,000 -
Charge-offs 3,200 -
Recoveries 200 1,600
Ending $ 85,000 $ 78,600
- -6-
<PAGE>
Home Building Bancorp, Inc.
Management's Discussion and Analysis of
Financial Condition and Results of Operations
General
Home Building Bancorp, Inc. (the Company) was formed at the direction of Home
Building Savings Bank, FSB (the Bank), for the purpose of owning all the
stock outstanding in the Bank. The Company incorporated under the laws of
the State of Indiana and is generally authorized to engage in any activity
permitted under Indiana law. On February 7, 1995, the Company acquired all
the stock of the Bank in accordance with the approved plan of conversion.
The Company had not engaged in any material operations at March 31, 1998,
and had no significant assets other than its equity investment in the bank's
stock, cash, investments, and a loan to the Bank's Employee Stock Ownership
Plan (ESOP).
Established in 1908, Home Building Savings Bank, FSB is a community oriented
financial institution offering a variety of financial services to meet the
needs of the communities it serves. The Bank's primary market area covers
Daviess and Pike counties in southwestern Indiana. The Bank attracts deposits
from the general public and uses such deposits, together with borrowings and
other funds, to originate one-to-four family residential mortgage loans,
automobile and consumer loans, and to a lesser extent commercial, multifamily
and construction real estate loans. The Bank also invests in U.S. government
and agency obligations and may invest in other permissible investments.
The Bank's results of operations are primarily dependent upon its net
interest income, which is the difference between interest earned on loans
and investments and interest paid on deposits and borrowed funds. Net
interest income is directly affected by the relative amounts of interest-earning
assets and interest-bearing liabilities and the interest rates earned or paid
on such amounts. The Bank's results of operations are also affected by the
provision for loan losses and the level of noninterest income and noninterest
expenses. The operating results of the Bank are also affected by general
economic conditions, the monetary and fiscal policies of federal agencies,
and the policies of agencies that regulate financial institutions. The
Bank's cost of funds is influenced by interest rates on competing investments
and general market rates of interest. Lending activities are influenced by the
demand for real estate loans and other types of loans, which in turn is
affected by the rates of interest at which loans are offered, general
economic conditions affecting loan demand, and the availability of funds for
lending activities.
Financial Condition
For the six months ended March 31, 1998, total assets increased approximately
$3.1 million to $44.8 million from $41.7 million at September 30, 1997. Cash and
due from banks decreased $77,000, while interest-bearing deposits increased
$158,000. Net loans receivable increased $3.9 million, to $32.5 million on
March 31, 1998 from $28.6 million on September 30, 1997. During the most recent
quarter the Bank purchased $2.5 million in adjustable rate first mortgage
loans on single family homes. The purchase was funded by a $2.5 million
increase in advances from the FHLB of Indianapolis. Management expects this
transaction to provide additional earnings for the future. Mortgage-backed
securities decreased $228,000 to $4,694,000 at March 31, 1998 and other
securities decreased $696,000 to $2,209,000 on that date compared to
September 30, 1997. The decreases resulted from accelerated repayments on
mortgage-backed securities and certain other securities in the portfolio being
called. The Company had $6.6 million in securities available for sale and only
$290,000 in held to maturity at March 31, 1998. The proceeds received from
repayments on securities were used to fund the additional increase in
mortgage loans.
- -7-
<PAGE>
Home Building Bancorp, Inc.
Management's Discussion and Analysis of
Financial Condition and Results of Operations
(continued)
Financial Condition, continued
Liabilities increased by approximately $2.9 million, to $38.8 million at March
31, 1998 from $35.9 million at September 30, 1997. Of the increase, $2.5
million was the FHLB advance used to purchase mortgage loans. Savings and NOW
deposits also increased by approximately $300,000 in the six-month period.
The Bank has maintained steady deposit rates which are competitive for its
marketplace and has been successful in retaining and slightly increasing
deposits since September 30, 1997.
Results of Operations:
Comparison of the three and six months ended March 31, 1998 and 1997.
General. The Company experienced a net profit of $84,000 for the three months
and $153,000 for the six months ended March 31, 1998, respectively, compared
to net profits of $95,000 and $163,000 for the same periods in 1997.
Interest Income. Total interest income decreased $39,000, or 4.6%, to $815,000
for the three months ended March 31, 1998, compared to the same period last
year. Interest income earned by the Company's loan portfolio increased
$12,000 for the three months ended March 31, 1998 compared to a year ago due
to higher loan volumes. Lower volumes of mortgage-backed securities and deposits
with other banks reduced interest from these sources by a total of $55,000 for
the most recent quarter compared to the same quarter a year ago. During this
quarter last year the Bank benefited from large short-term deposits which
were withdrawn later in fiscal year 1997. For the six-month period interest
income decreased $27,000, or 1.6%, to $1,623,000 compared to $1,650,000
during the first six months of fiscal year 1997.
Interest Expense. Total interest expense decreased $28,000, or 6.0%, during the
most recent quarter compared to the same quarter a year ago. Interest on
deposits decreased because the average balance of savings account deposits
was less compared to a year ago. Interest paid on borrowed funds increased as
the additional funds were borrowed from FHLB. The weighted average cost of
deposits at March 31, 1998 was 4.58% compared to 4.57% at December 31, 1997. The
overall cost of funds, including all FHLB advances, was 4.76% on March 31,
1998 compared to 4.69% on December 31, 1997. The small increase reflects the
rates paid on the additional advances taken during the quarter. The Bank is
able to compete aggressively for savings funds when adequate spreads on loans
or investments are available. FHLB advances have been an effective liability
management tool.
Net Interest Income. Net interest income, before provision for loan losses,
decreased $11,000, or 2.9%, to $373,000 for the quarter compared to the same
quarter a year ago. As of March 31, 1998 interest-earning assets were 109.2%
of interest bearing liabilities.
Demand for mortgage loans was very strong during the six-month period. Net loans
receivable increased $3.9 million to $32.5 million at March 31, 1998 compared to
$28.6 million at September 30, 1997. Two packages of single family,
adjustable rate mortgages loans were purchased during the most recent
quarter, totaling $2.5 million. Local loan volume grew a net $1.4 million for
the six-month period as well. Securities held for sale decreased $900,000 in
the six-month period to $6.6 million at March 31, 1998 from $7.5 million at
September 30, 1997.
- -8-
<PAGE>
Home Building Bancorp, Inc.
Management's Discussion and Analysis of
Financial Condition and Results of Operations
(continued)
Net Interest Income, continued
Savings and NOW deposits increased during the six-month period by $300,000, to
$11.2 million from $10.9 million. The Bank increased its advances from the FHLB
by $2.5 million during the most recent quarter, to $6.5 million at March 31,
1998, to fund the purchase of the mortgage loan packages. Management feels
these advances were a cost effective alternative to raising funds from local
depositors, and allowed funding to be more efficiently matched with the
interest rate characteristics of the loans. Significant increases in short
term interest rates would adversely affect the Company's interest rate spread
and thus interest income. In the case of some short-term funds, such as short-
term public funds, the Company could decline to bid and allow them to be
withdrawn if acceptable spreads are not available. The Company's liabilities
are generally shorter in term and subject to repricing more frequently than
assets.
The Company continues to stress consumer and installment lending, shorter-term
(15 years and under) fixed rate mortgage loans, and adjustable rate mortgages.
Investments involve shorter-term and adjustable securities to respond to
changing rates. The Company, as a thrift institution, continues to have a
below average exposure to interest rate risk compared to its peers.
Nonperforming Assets and Provision for Loan Losses. The provision for loan
losses is a result of management's periodic analysis of the adequacy of the
Company's allowance for loan losses. During the three-month period ended
March 31, 1998, an additional provision of $5,000 was taken against
earnings. The Company adjusts its allowance in accordance with its Classified
Assets Policy. The Company believes it has taken an appropriate approach
toward reserve levels, consistent with the Company's loan portfolio, its
current level of reserves, the economy, real estate values and interest
rates. The Company has had an extremely low level of loan losses during its
history and therefore also considers the loss experience of similar
portfolios in comparable lending markets. Federal regulators may require
additional reserves as a result of their examinations of the Company, but have
not done so. Accordingly, the calculation of the adequacy of the allowance is
not solely based directly on the level of nonperforming assets at any one
time. No assurance can be made that future losses will not exceed the
estimated amounts, thereby adversely affecting future results of operations. As
of March 31, 1998, the Company,s allowance for loan losses was $85,000
compared to $81,000 on September 30, 1997. Over the six-month period $3,000
in losses were recognized and $7,000 in additions were made to the loan loss
reserve.
As of March 31,1998, the Company's nonperforming assets totaled $170,000, or
.38% of total assets. At the same date, the Company's ratio of allowance for
loan losses to nonperforming assets was 50%.
Noninterest Income. Noninterest income increased $20,000, or 57.1%, to $55,000
for the most recent quarter compared to the same quarter a year ago. For the
six-month period noninterest income increased $25,000, or 40.3%, to $88,000
for the period. During the six month period $17,000 in gains on the sale of
assets were realized, compared to $3,000 during the same six month period a year
ago. The Company does not depend on the regular or periodic sale of assets
for income, but during the quarter some investment securities were called at
profit to the Bank. Customer service fees increased $12,000, or 20.3%, to
$71,000 for the six-month period ended March 31, 1998 compared to $59,000 for
the same period a year ago. The increase in customer service fees was
attributable to an increase in the volume of customer activities for which
these fees are charged.
- -9-
<PAGE>
Home Building Bancorp, Inc.
Management's Discussion and Analysis of
Financial Condition and Results of Operations
(continued)
Noninterest Expense. Total noninterest expense increased $13,000, or 4.9%, to
$281,000 for the latest quarter compared to $268,000 for the same quarter a
year ago. For the six months noninterest expense increased $53,000, to
$583,000 compared to $530,000 for the same period a year ago. The increase
was partially due to salaries, employee benefits, and professional fees.
Compared to the same period a year ago the bank has added the equivalent of
1 1/2 full time employees. Other expenses increased due to the Bank,s debit
card operation, and the Bank expensed $10,000 in insurance deductible related
to its insurance receivable.
Year 2000 Issue. Many existing computer programs use only two digits to
identify a year in the date field. If not corrected, many of these programs
could fail or create erroneous results by or at the year 2000. The Year 2000
issue affects virtually all companies. The Bank has attempted to identify all
internal operations and external entities where the Year 2000 issue may impact
operations and ultimately financial results. This review includes, but is
not limited to, the physical facilities of the Bank, its equipment, and
computer hardware and software packages. The Bank is also reviewing its
correspondent banks, data center, and other vendors with whom the Bank does
business or relies upon for its operations. The Bank is monitoring the
progress of these entities toward Year 2000 compliance. The Company
presently believes that with the planned modifications to existing systems and
vendor delivery of millennium-compliant systems, all material Year 2000
compliance issues will be resolved on a timely basis. Additionally, the
Company believes that any related costs will not have a material impact on
the operations, cash flows, or financial condition of future periods.
Income Tax Expense. Income tax expense was $58,000, an effective rate of
40.9%, for the most recent quarter compared to $56,000, an effective rate of
37.3%, for the same quarter a year ago. For the six months ended March 31,
1998, tax expense was $90,000, an effective rate of 36.9%, compared to
$97,000, an effective rate of 37.4%, for the same period a year ago. Tax expense
reflects the level of profitability for the respective periods.
Liquidity and Capital Requirements. Home Building's main sources of funds are
deposits, loan and investment repayments, fees and service charges, and FHLB
advances. Federal regulations require the Bank to maintain cash and eligible
investments at levels that assure its ability to meet demands for withdrawals
and repayments of short-term borrowings. As of March 31, 1998, the Bank had
cash and due from banks, deposits, and securities available for sale with an
estimated market value of $10.6 million, or 23.7% of total assets.
The Bank uses its capital resources to meet ongoing commitments, to fund
maturing certificates of deposit and deposit withdrawals, to invest, to fund
existing and future loan commitments, to maintain liquidity, and to meet
operating expenses. The Bank anticipates it will have sufficient funds to meet
current loan commitments. At March 31, 1998, the Bank had outstanding
commitments to extend credit totaling $ 1.6 million. Management believes loan
repayments, deposits, and other sources of funds will be adequate to meet the
Bank's foreseeable liquidity needs. FHLB advances may be used to take
advantage of investment opportunities, or as an alternative source of liquid
funds, but are not relied upon in the regular course of business.
Home Building Savings Bank is required to maintain specific amounts of
regulatory capital pursuant to federal regulations. The table below presents
the capital position at March 31, 1998, relative to the regulatory capital
requirements.
- -10-
<PAGE>
Home Building Bancorp, Inc.
Management's Discussion and Analysis of
Financial Condition and Results of Operations
(concluded)
Liquidity and Capital Requirements, continued
Amount
(in thousands) Percent of Assets
Tangible Capital $ 4,637 10.39%
Tangible Capital Requirement 670 1.50%
Excess 3,967 8.89%
Core Capital $ 4,637 10.39%
Core Capital Requirement 1,340 3.00%
Excess 3,297 7.39%
Total Capital (Core & Supple.) $ 4,722 20.29%
Risk-Based Capital Requirement 1,862 8.00%
Excess 2,860 12.29%
- -11-
<PAGE>
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
(a) January 29, 1998
(b) See (c)
(c) Election of Directors
Name of Nominee For Withheld
Bruce A. Beesley (3-year term) 238,610 7,920
C. Darrell Deem (3-year term) 238,510 8,020
Further, 244,289 votes were cast for the ratification of Kemper CPA Group,
LLC as the Company's independent auditors for the fiscal year ending
September 30, 1998. There were 707 votes cast against ratification
with 1,534 abstaining.
(d) Not Applicable
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 27: Financial Data Schedules (electronic filing only)
(b) There were no reports on Form 8-K filed during the quarter.
- -12-
<PAGE>
SIGNATURES
Pursuant to the requirement 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.
HOME BUILDING BANCORP, INC.
Registrant
Date: 5/14/98 /s/ Bruce A. Beesley
Bruce A. Beesley, President and Chief
Executive Officer (Duly Authorized Officer)
Date: 5/14/98 /s/ Debra K. Shields
Debra K. Shields, Vice President and
Chief Financial Officer (Principal Financial
and Accounting Officer)
- -13-
<PAGE>
INDEX OF EXHIBITS
Exhibit Description
27 Financial Data Schedules (electronic filing only)
For six month period ended March 31, 1998
For nine month period ended June 30, 1996 (restated)
For year ended September 30, 1996 (restated)
For three month period ended December 31, 1996 (restated)
For six month period ended March 31, 1997 (restated)
For nine month period ended June 30, 1997 (restated)
For year ended September 30, 1997 (restated)
- -14-
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM UNAUDITED
FINANCIAL STATEMENTS DATED MARCH 31, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-END> MAR-30-1998
<CASH> 1416673
<INT-BEARING-DEPOSITS> 2679639
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 6613964
<INVESTMENTS-CARRYING> 289874
<INVESTMENTS-MARKET> 293000
<LOANS> 32505488
<ALLOWANCE> 85000
<TOTAL-ASSETS> 44834861
<DEPOSITS> 31944901
<SHORT-TERM> 0
<LIABILITIES-OTHER> 327670
<LONG-TERM> 6500341
0
0
<COMMON> 3317
<OTHER-SE> 6058632
<TOTAL-LIABILITIES-AND-EQUITY> 44834861
<INTEREST-LOAN> 1235989
<INTEREST-INVEST> 103878
<INTEREST-OTHER> 283257
<INTEREST-TOTAL> 1623124
<INTEREST-DEPOSIT> 753355
<INTEREST-EXPENSE> 877578
<INTEREST-INCOME-NET> 745546
<LOAN-LOSSES> 7000
<SECURITIES-GAINS> 7309
<EXPENSE-OTHER> 583285
<INCOME-PRETAX> 242885
<INCOME-PRE-EXTRAORDINARY> 153155
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 153155
<EPS-PRIMARY> .53
<EPS-DILUTED> .52
<YIELD-ACTUAL> .04
<LOANS-NON> 169000
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 81000
<CHARGE-OFFS> 3200
<RECOVERIES> 200
<ALLOWANCE-CLOSE> 85000
<ALLOWANCE-DOMESTIC> 25500
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 59500
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM UNAUDITED
FINANCIAL STATEMENTS DATED JUNE 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<RESTATED>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> JUN-30-1996
<CASH> 5538843
<INT-BEARING-DEPOSITS> 1482871
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 6811779
<INVESTMENTS-CARRYING> 504360
<INVESTMENTS-MARKET> 509893
<LOANS> 27694240
<ALLOWANCE> 53000
<TOTAL-ASSETS> 43134989
<DEPOSITS> 32715347
<SHORT-TERM> 360821
<LIABILITIES-OTHER> 113876
<LONG-TERM> 3930153
0
0
<COMMON> 3317
<OTHER-SE> 6011475
<TOTAL-LIABILITIES-AND-EQUITY> 43134989
<INTEREST-LOAN> 1818722
<INTEREST-INVEST> 117191
<INTEREST-OTHER> 459737
<INTEREST-TOTAL> 2395650
<INTEREST-DEPOSIT> 1126142
<INTEREST-EXPENSE> 1309640
<INTEREST-INCOME-NET> 1086010
<LOAN-LOSSES> 356500
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 826881
<INCOME-PRETAX> 27743
<INCOME-PRE-EXTRAORDINARY> 4912
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4912
<EPS-PRIMARY> .08
<EPS-DILUTED> .08
<YIELD-ACTUAL> .07
<LOANS-NON> 166000
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 77000
<CHARGE-OFFS> 383000
<RECOVERIES> 2600
<ALLOWANCE-CLOSE> 53000
<ALLOWANCE-DOMESTIC> 37000
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 16000
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM AUDITED
FINANCIAL STATEMENTS DATED SEPTEMBER 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<RESTATED>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<CASH> 1428754
<INT-BEARING-DEPOSITS> 3793704
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 7532540
<INVESTMENTS-CARRYING> 473104
<INVESTMENTS-MARKET> 473000
<LOANS> 28185279
<ALLOWANCE> 77000
<TOTAL-ASSETS> 42560700
<DEPOSITS> 32627632
<SHORT-TERM> 273951
<LIABILITIES-OTHER> 460613
<LONG-TERM> 3699985
0
0
<COMMON> 3317
<OTHER-SE> 5495202
<TOTAL-LIABILITIES-AND-EQUITY> 42560700
<INTEREST-LOAN> 2404113
<INTEREST-INVEST> 501502
<INTEREST-OTHER> 308865
<INTEREST-TOTAL> 3214480
<INTEREST-DEPOSIT> 1514716
<INTEREST-EXPENSE> 1756070
<INTEREST-INCOME-NET> 1458410
<LOAN-LOSSES> 409770
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1298106
<INCOME-PRETAX> (108076)
<INCOME-PRE-EXTRAORDINARY> (136076)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (136076)
<EPS-PRIMARY> (.46)
<EPS-DILUTED> (.46)
<YIELD-ACTUAL> .09
<LOANS-NON> 149000
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 56000
<ALLOWANCE-OPEN> 77039
<CHARGE-OFFS> 409809
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 77000
<ALLOWANCE-DOMESTIC> 22328
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 54672
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM UNAUDITED
FINANCIAL STATEMENTS DATED DECEMBER 31, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS
</LEGEND>
<RESTATED>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> DEC-31-1996
<CASH> 1,987,822
<INT-BEARING-DEPOSITS> 4,674,595
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 7,907,598
<INVESTMENTS-CARRYING> 440,483
<INVESTMENTS-MARKET> 446,000
<LOANS> 28,365,532
<ALLOWANCE> 78,500
<TOTAL-ASSETS> 44,563,762
<DEPOSITS> 34,755,316
<SHORT-TERM> 21,673
<LIABILITIES-OTHER> 520,700
<LONG-TERM> 3,699,985
0
0
<COMMON> 3,317
<OTHER-SE> 5,562,771
<TOTAL-LIABILITIES-AND-EQUITY> 44,563,762
<INTEREST-LOAN> 583,622
<INTEREST-INVEST> 33,789
<INTEREST-OTHER> 177,945
<INTEREST-TOTAL> 795,356
<INTEREST-DEPOSIT> 395,871
<INTEREST-EXPENSE> 451,860
<INTEREST-INCOME-NET> 343,496
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 261,437
<INCOME-PRETAX> 109,253
<INCOME-PRE-EXTRAORDINARY> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 68,232
<EPS-PRIMARY> .24
<EPS-DILUTED> .24
<YIELD-ACTUAL> .02
<LOANS-NON> 456,000
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 77,000
<CHARGE-OFFS> 0
<RECOVERIES> 1,500
<ALLOWANCE-CLOSE> 78,500
<ALLOWANCE-DOMESTIC> 68,400
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 10,100
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM UNAUDITED
FINANCIAL STATEMENTS DATED MARCH 31, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<RESTATED>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> MAR-31-1997
<CASH> 1769513
<INT-BEARING-DEPOSITS> 7960101
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 7340704
<INVESTMENTS-CARRYING> 409481
<INVESTMENTS-MARKET> 411000
<LOANS> 28195201
<ALLOWANCE> 78600
<TOTAL-ASSETS> 46803994
<DEPOSITS> 37110290
<SHORT-TERM> 0
<LIABILITIES-OTHER> 344521
<LONG-TERM> 3699985
0
0
<COMMON> 3317
<OTHER-SE> 5645881
<TOTAL-LIABILITIES-AND-EQUITY> 46803994
<INTEREST-LOAN> 1195691
<INTEREST-INVEST> 74425
<INTEREST-OTHER> 379840
<INTEREST-TOTAL> 1649956
<INTEREST-DEPOSIT> 813362
<INTEREST-EXPENSE> 922001
<INTEREST-INCOME-NET> 727955
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 2896
<EXPENSE-OTHER> 529650
<INCOME-PRETAX> 260673
<INCOME-PRE-EXTRAORDINARY> 163190
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 163190
<EPS-PRIMARY> .58
<EPS-DILUTED> .57
<YIELD-ACTUAL> .04
<LOANS-NON> 243000
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 77000
<CHARGE-OFFS> 0
<RECOVERIES> 1600
<ALLOWANCE-CLOSE> 78600
<ALLOWANCE-DOMESTIC> 68500
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 10100
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM UNAUDITED
FINANCIAL STATEMENTS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<RESTATED>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> JUN-30-1997
<CASH> 1,420,470
<INT-BEARING-DEPOSITS> 6,706,113
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 7,167,794
<INVESTMENTS-CARRYING> 377,824
<INVESTMENTS-MARKET> 381,000
<LOANS> 28,228,835
<ALLOWANCE> 82,668
<TOTAL-ASSETS> 45,063,854
<DEPOSITS> 35,211,886
<SHORT-TERM> 0
<LIABILITIES-OTHER> 378,486
<LONG-TERM> 3,699,985
0
0
<COMMON> 3,317
<OTHER-SE> 5,770,180
<TOTAL-LIABILITIES-AND-EQUITY> 45,063,854
<INTEREST-LOAN> 1,795,274
<INTEREST-INVEST> 119,176
<INTEREST-OTHER> 581,708
<INTEREST-TOTAL> 2,496,158
<INTEREST-DEPOSIT> 1,225,601
<INTEREST-EXPENSE> 1,386,967
<INTEREST-INCOME-NET> 1,109,191
<LOAN-LOSSES> 5,000
<SECURITIES-GAINS> 10,989
<EXPENSE-OTHER> 798,625
<INCOME-PRETAX> 403,673
<INCOME-PRE-EXTRAORDINARY> 250,227
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 250,227
<EPS-PRIMARY> .88
<EPS-DILUTED> .86
<YIELD-ACTUAL> .06
<LOANS-NON> 173,000
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 77,000
<CHARGE-OFFS> 1,108
<RECOVERIES> 1,776
<ALLOWANCE-CLOSE> 82,668
<ALLOWANCE-DOMESTIC> 82,668
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 33,084
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM AUDITED
FINANCIAL STATEMENTS DATED September 30, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<RESTATED>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> SEP-30-1997
<CASH> 1494118
<INT-BEARING-DEPOSITS> 2521578
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 7483447
<INVESTMENTS-CARRYING> 344257
<INVESTMENTS-MARKET> 349193
<LOANS> 28582610
<ALLOWANCE> 80680
<TOTAL-ASSETS> 41749752
<DEPOSITS> 31517533
<SHORT-TERM> 0
<LIABILITIES-OTHER> 338947
<LONG-TERM> 4000341
0
0
<COMMON> 3317
<OTHER-SE> 5889614
<TOTAL-LIABILITIES-AND-EQUITY> 41749752
<INTEREST-LOAN> 2393642
<INTEREST-INVEST> 580732
<INTEREST-OTHER> 331271
<INTEREST-TOTAL> 3305645
<INTEREST-DEPOSIT> 1614091
<INTEREST-EXPENSE> 1830961
<INTEREST-INCOME-NET> 1474684
<LOAN-LOSSES> 5000
<SECURITIES-GAINS> 12743
<EXPENSE-OTHER> 1058647
<INCOME-PRETAX> 537504
<INCOME-PRE-EXTRAORDINARY> 327740
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 327740
<EPS-PRIMARY> 1.15
<EPS-DILUTED> 1.12
<YIELD-ACTUAL> .08
<LOANS-NON> 250000
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 163,000
<ALLOWANCE-OPEN> 77000
<CHARGE-OFFS> 3249
<RECOVERIES> 1929
<ALLOWANCE-CLOSE> 80680
<ALLOWANCE-DOMESTIC> 39556
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 41124
</TABLE>
