<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 March 31, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 0-26292
COMMUNITY FINANCIAL CORP.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
ILLINOIS 37-1337630
------------------------------ -------------------
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
240 E. CHESTNUT STREET, OLNEY, ILLINOIS 62450-2295
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (618) 395-8676
--------------
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 May 2, 1997, the Registrant had 2,370,612 shares of Common Stock
issued and outstanding.
<PAGE>
CONTENTS
PAGE
----
PART I. FINANCIAL INFORMATION
---------------------
Item 1. Financial Statements
Consolidated Balance Sheets as of March 31, 1997
and December 31, 1996.................................. 3
Consolidated Statements of Income for the Three-Month
Period Ended March 31, 1997 and 1996................... 4
Consolidated Statements of Cash Flows for the Three-Month
Period Ended March 31, 1997 and 1996................... 5
Consolidated Statements of Stockholders' Equity for the
Three-Month Period Ended March 31, 1997................ 7
Notes to Consolidated Financial Statements................. 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.................... 9
PART II. OTHER INFORMATION
-----------------
Item 1. Legal Proceedings......................................... 12
Item 2. Changes in Securities..................................... 12
Item 3. Defaults Upon Senior Securities........................... 12
Item 4. Submission of Matters to a Vote of Security-Holders....... 12
Item 5. Other Information......................................... 12
Item 6. Exhibits and Reports on Form 8-K.......................... 12
SIGNATURES........................................................... 13
2
<PAGE>
PART 1 - FINANCIAL INFORMATION
COMMUNITY FINANCIAL CORP AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
MARCH 31 DECEMBER 31
ASSETS 1997 1996
- ------ ---------- -----------
<S> <C> <C>
CASH AND CASH EQUIVALENTS:
CASH $ 1,143 $ 1,285
INTEREST BEARING DEPOSITS
10,014 11,333
TOTAL CASH AND CASH EQUIVALENTS -------- --------
11,157 12,618
TIME DEPOSITS 0 0
SECURITIES AVAILABLE FOR SALE (amortized cost 15,045 13,990
of $15,327 (1997) and $14,213 (1996))
SECURITIES HELD TO MATURITY (estimated market value 3,234 3,362
of $3,239 (1997) and $3,378 (1996))
MORTGAGE-BACK & RELATED SECURITIES AVAILABLE FOR SALE 27,042 28,319
(amortized cost of $27,464 (1997) and $28,535(1996))
LOANS RECEIVABLE, net 120,789 122,307
FORECLOSED REAL ESTATE, net 124 53
REAL ESTATE HELD FOR SALE 0 0
ACCRUED INTEREST RECEIVABLE 1,237 1,239
PREMISES AND EQUIPMENT, net 2,685 2,609
PREPAID INCOME TAXES 145 166
DEFERRED INCOME TAXES 515 409
OTHER ASSETS 764 727
-------- --------
TOTAL ASSETS $182,737 $185,799
======== ========
LIABILITIES AND STOCKHOLDER'S EQUITY
- ------------------------------------
DEPOSITS $138,429 $139,100
FEDERAL HOME LOAN BANK ADVANCES 5,000 7,500
REPURCHASE AGREEMENTS 3,963 3,121
ADVANCES FROM BORROWERS FOR TAXES AND INSURANCE 67 40
ACCRUED INTEREST PAYABLE 234 160
ACCRUED INCOME TAXES 0 0
OTHER LIABILITIES 1,082 1,796
-------- --------
TOTAL LIABILITIES $148,775 $151,717
-------- --------
STOCKHOLDER EQUITY:
COMMON STOCK, $.01 PAR VALUE PER SHARE:
7,000,000 SHARES AUTHORIZED; 2,370,612
AND 2,387,112 SHARES ISSUED AT MARCH 31, 1997
AND DECEMBER 31, 1996 $ 26 $ 26
ADDITIONAL PAID-IN CAPITAL 25,448 25,397
TREASURY STOCK (3,655) (3,411)
ESOP (1,688) (1,693)
SHARES HELD FOR MRP (938) (1,123)
RETAINED EARNINGS-SUBSTANTIALLY RESTRICTED 15,191 15,149
UNREALIZED LOSS ON SECURITIES AVAILABLE FOR SALE,
NET OF RELATED TAXES
(422) (263)
TOTAL STOCKHOLDER EQUITY -------- --------
$ 33,962 $ 34,082
-------- --------
COMMITMENTS AND CONTINGENCIES 0.00 0.00
TOTAL LIABILITIES AND STOCKHOLDER EQUITY $182,737 $185,799
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE>
COMMUNITY FINANCIAL CORP AND SUBSIDIARY
CONSOLIDATED STATEMENT OF INCOME
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31
1997 1996
------ ------
<S> <C> <C>
INTEREST INCOME:
INTEREST ON LOANS $2,672 $2,500
INTEREST ON MORTGAGE-BACKED AND RELATED SECURITIES 451 558
INTEREST ON INVESTMENTS AND INTEREST-BEARING DEPOSITS 379 397
------ ------
TOTAL INTEREST INCOME $3,502 $3,455
------ ------
INTEREST EXPENSE:
INTEREST ON DEPOSITS $1,574 $1,634
INTEREST ON OTHER BORROWED FUNDS 116 59
------ ------
TOTAL INTEREST EXPENSE $1,690 $1,693
------ ------
NET INTEREST INCOME $1,812 $1,762
PROVISIONS FOR LOAN LOSSES 33 (51)
------ ------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES $1,779 $1,813
------ ------
NON-INTEREST INCOME:
SERVICE FEES $ 169 $ 123
INSURANCE AND ANNUITY COMMISSIONS 43 46
NET GAIN (LOSS) ON SALE OF SECURITIES 0 0
OTHER 10 28
------ ------
TOTAL NON-INTEREST INCOME $ 222 $ 197
------ ------
NON-INTEREST EXPENSE:
COMPENSATION AND BENEFITS $1,364 $ 755
OCCUPANCY 53 52
EQUIPMENT AND FURNISHING 98 83
DATA PROCESSING 106 118
FEDERAL DEPOSIT INSURANCE PREMIUMS 22 96
OTHER 294 214
------ ------
TOTAL NON-INTEREST EXPENSE $1,937 $1,318
------ ------
INCOME BEFORE INCOME TAXES, EXTRAORDINARY
ITEM, AND CUMULATIVE EFFECT OF CHANGES
IN ACCOUNTING PRINCIPLE $ 64 $ 692
PROVISION FOR INCOME TAXES 22 248
------ ------
NET INCOME $ 42 $ 444
====== ======
EARNINGS PER SHARE $ 0.02 0.19
======= ======
</TABLE>
See accompanying notes to consolidated financial statements.
4
<PAGE>
COMMUNITY FINANCIAL CORP AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31 MARCH 31
1997 1996
------- ------
<S> <C> <C>
OPERATING ACTIVITIES:
NET INCOME $ 42 $ 444
ADJUSTMENTS TO RECONCILE NET INCOME TO NET
CASH PROVIDED BY OPERATING ACTIVITIES:
PROVISION FOR DEPRECIATION 87 54
PROVISION FOR LOAN LOSSES 33 (51)
ACCRETION OF DISCOUNTS ON SECURITIES (11) (18)
AMORTIZATION OF PREMIUMS ON SECURITIES 8 13
AMORTIZATION OF MRP 185 70
DECREASE IN ACCRUED INTEREST RECEIVABLE 2 43
(INCREASE) DECREASE IN OTHER ASSETS (37) (446)
(DECREASE) INCREASE IN ACCRUED INCOME TAXES 21 268
(INCREASE) DECREASE IN DEFERRED INCOME TAXES (106) (183)
INCREASE (DECREASE) IN ACCRUED INTEREST PAYABLE 74 70
INCREASE (DECREASE) IN OTHER LIABILITIES (714) (304)
FEDERAL HOME LOAN BANK STOCK DIVIDENDS RECEIVED 0 0
DIVIDENDS ON SECURITIES 0 0
LOSS (GAIN) ON SALE OF SECURITIES AND MORTGAGE-BACKED
AND RELATED SECURITIES 0 0
LOSS (GAIN) IN SALE OF PREMISES AND EQUIPMENT 0 0
------- ------
NET CASH PROVIDED BY OPERATING ACTIVITIES $ (416) $ (40)
------- ------
INVESTING ACTIVITIES:
PROCEEDS FROM SALES OF SECURITIES AVAILABLE FOR SALE 0 0
PROCEEDS FROM SALES OF SECURITIES HELD TO MATURITY 0 0
PROCEEDS FROM MATURITIES OF SECURITIES HELD TO MATURITY 212 125
PROCEEDS FROM MATURITIES OF SECURITIES AVAILABLE FOR SALE 1,803 2,000
PROCEEDS FROM SALES OF MORTGAGE-BACKED AND RELATED
SECURITIES 0 0
PURCHASE OF MORTGAGE-BACKED AND RELATED SECURITIES 0 0
PURCHASE OF SECURITIES AVAILABLE FOR SALE (3,000) 0
PURCHASE OF SECURITIES HELD TO MATURITY 0 85
PROCEEDS FROM MATURING TIME DEPOSITS 0 0
PURCHASE OF LOANS 0 0
DECREASE (INCREASE) IN LOAN RECEIVABLE 1,485 (624)
PRINCIPAL COLLECTED ON MORTGAGE-BACKED AND RELATED
SECURITIES 1,020 1,396
SFAS 115 ADJUSTMENT 159 274
DECREASE (INCREASE) IN FORECLOSED REAL ESTATE (71) 0
PURCHASE OF PREMISES AND EQUIPMENT (163) (30)
PROCEEDS FROM SALE OF EQUIPMENT 0 0
PURCHASE OF FEDERAL HOME LOAN BANK STOCK 0 0
PURCHASE OF FEDERAL RESERVE BANK STOCK 0 0
PROCEEDS FROM SALE OF FEDERAL HOME LOAN BANK STOCK 0 0
------- ------
NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES $ 1,445 $3,226
------- ------
</TABLE>
5
<PAGE>
COMMUNITY FINANCIAL CORP AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31 MARCH 31
1997 1996
-------- --------
<S> <C> <C>
FINANCING ACTIVITIES:
NET (DECREASE) IN DEPOSITS $ (671) $(1,826)
INCREASE IN ADVANCES FROM BORROWERS
FOR TAXES AND INSURANCE 27 41
INCREASE (DECREASE) IN SHORT-TERM BORROWINGS (1,658) 2,796
PROCEEDS FROM SALE OF STOCK 0 0
UNEARNED EMPLOYEE STOCK OWNERSHIP PLAN 5 0
PURCHASE OF SHARES FOR MRP 0 (1,403)
PURCHASE OF TREASURY STOCK (244) 0
ESOP ADJUSTMENT 26 0
MRP ADJUSTMENT 25 0
------- -------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES $(2,490) $ (392)
------- -------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS $(1,461) 2,794
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD $12,618 $ 9,877
------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $11,157 $12,671
======= =======
SUPPLEMENTAL DISCLOSURES:
ADDITIONAL CASH FLOW INFORMATION:
CASH PAID FOR:
INTEREST ON DEPOSITS, ADVANCES AND
OTHER BORROWINGS $ 1,620 $ 1,626
INCOME TAXES:
FEDERAL $ 0 $ 0
STATE $ 0 $ 0
SCHEDULE OF NONCASH INVESTING ACTIVITIES:
STOCK DIVIDENDS DISTRIBUTED BY THE
FEDERAL HOME LOAN BANK OF CHICAGO $ 0 $ 0
SECURITIES, MORTGAGE-BACKED AND RELATED SECURITIES
TRANSFERRED TO AVAILABLE FOR SALE $ 0 $ 0
CHANGE IN UNREALIZED GAIN (LOSS) ON SECURITIES
AVAILABLE FOR SALE $ (265) $ (439)
CHANGE IN DEFERRED INCOME TAXES ATTRIBUTED TO
UNREALIZED GAIN (LOSS) ON SECURITIES AVAILABLE
FOR SALE $ 106 $ 109
</TABLE>
6
<PAGE>
COMMUNITY FINANCIAL CORP AND SUBSIDIARY
CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
ADDITIONAL GUARANTEE NET UNREALIZED
COMMON PAID-IN TREASURY OF ESOP MRP RETAINED LOSS ON SECURITIES
STOCK CAPITAL STOCK INDEBTEDNESS STOCK EARNINGS AVAILABLE FOR SALE TOTAL
------ ---------- -------- ------------ ------- -------- ------------------ --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
BALANCE, DECEMBER 31, 1996 $ 26 $ 25,397 $ (3,411) $ (1,693) $(1,123) $ 15,149 $ (263) $ 34,082
NET INCOME $ 42 $ 42
SALE OF COMMON STOCK $ 0 $ 0 $ 0
GUARANTEE OF ESOP
INDEBTEDNESS $ 5 $ 5
SHARES HELD FOR MANAGEMENT
RECOGNITION PLAN $ 185 $ 185
TREASURY STOCK $ (244) $ (244)
ESOP SOP 93-6 ADJUSTMENT $ 51 $ 51
CHANGE IN NET UNREALIZED
LOSS ON SECURITIES AVAILABLE
FOR SALE $ 0 $ (159) $ (159)
------ ---------- -------- ---------- ------- -------- ------ --------
BALANCE, MARCH 31, 1997 $ 26 $ 25,448 $ (3,655) $ (1,688) $ (938) $ 15,191 $ (422) $ 33,962
====== ========== ======== ========== ======= ======== ====== ========
</TABLE>
See accompanying notes to consolidated financial statements.
7
<PAGE>
COMMUNITY FINANCIAL CORP
and SUBSIDIARY
Notes to Consolidated Financial Statements
March 31, 1997
(Unaudited)
(1) DESCRIPTION OF THE BUSINESS
Community Financial Corp. (the Company), an Illinois corporation, is a
holding company of Community Bank & Trust, N.A. (the Bank). Community
Financial Corp. is primarily engaged in the business of directing, planning
and coordinating the business activities of Community Bank & Trust, N.A.,
which primarily consist of accepting deposits from the general public
through its branches and investing these funds in loans in the Bank's
market areas and in investment securities and mortgage-backed securities.
(2) BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements were prepared
in accordance with instructions for Form 10-Q and, therefore, do not
include all information and footnotes necessary for a complete presentation
of financial position, results of operations, changes in stockholders'
equity, and cash flows in conformity with generally accepted accounting
principles. However, all adjustments (consisting only of normal recurring
accruals) which, in the opinion of management, are necessary for a fair
presentation of the unaudited consolidated financial statements have been
included in the results of operations for the three months ended March 31,
1997 and 1996.
(3) PRINCIPLES OF CONSOLIDATION
The accompanying unaudited consolidated financial statements include the
accounts of Community Financial Corp and Community Bank &
Trust. All significant intercompany items have been eliminated.
(4) EARNINGS PER COMMON SHARE
Income per common share is based on SOP93-6 and that 2,211,915 and
2,348,760 shares outstanding at March 31, 1997, and 1996, respectively,
were outstanding for all periods.
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
- -------------------------------------------------------------------------------
OF OPERATIONS
- -------------
COMPARISON OF CONDITION AT MARCH 31, 1997 AND DECEMBER 31, 1996.
Total assets decreased by $3.1 million or 1.6% from $185.8 million at December
31, 1996 to $182.7 million at March 31, 1997. Total cash and cash equivalents
(which includes federal funds sold) decreased $1.5 million or 11.6% from $12.6
million at December 31, 1996 to $11.2 million at March 31, 1997. The Bank's loan
portfolio decreased by $1.5 million or 1.2% from $122.3 million at December 31,
1996 to $120.8 million at March 31, 1997. Securities available for sale
increased by $1.1 million or 7.5% from $14.0 million at December 31, 1996 to
$15.0 million at March 31, 1997. Mortgage-back and related securities available
for sale declined by $1.3 million or 4.5% from $28.3 million at December 31,
1996 to $27.0 million at March 31, 1997 as a result of principle paybacks.
During the three months ended March 31, 1997, the Company's portfolio of
investment securities and mortgage-backed and related securities, classified as
available for sale pursuant to Statement of Financial Accounting Standards
("SFAS") No. 115, decreased capital by $422,000 (net of taxes) as a result of a
decrease in the market value. Total liabilities decreased $2.9 million or 1.9%
from $151.7 million at December 31, 1996 to $148.8 million at March 31, 1997.
Deposits declined by $671,000 or 0.5% from $139.1 million at December 31, 1996
to $138.4 million at March 31, 1997. Federal Home Loan Bank advances decreased
by $2.5 million or 33.3% from $7.5 million at December 31, 1996 to $5.0 million
at March 31, 1997. Repurchase agreements increased by $842,000 or 27.0% from
$3.1 million at December 31, 1996 to $4.0 million at March 31, 1997.
COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND
1996.
NET INCOME. Net income was $42,000 for the three months ended March 31, 1997, as
compared to $444,000 for the three months ended March 31, 1996. This represents
a decrease of $402,000, or 90.5%. The decrease was due primarily to an early
retirement program that was offered to twelve employees of which seven employees
elected to participate in the program. The pre-tax cost of the program was
approximately $509,000 which was paid during the quarter. The restated net
income after removing the cost of the non-recurring early retirement program
would have been $376,000.
NET INTEREST INCOME. Net interest income remained unchanged at $1.8 million for
the three months ended March 31, 1997 and for the three months ended March 31,
1996.
INTEREST INCOME. Interest income remained unchanged at $3.5 million for the
three months ended March 31, 1997, and for the three months ended March 31,
1996. Interest income on loans increased by $172,000 or 6.9% from $2.5 million
at March 31, 1996 to $2.7 million for March 31, 1997 due to the average balance
of loans increasing by $6.7 million or 5.9%, from $114.8 million for the three
months ended March 31, 1996 to $121.5 million for the three months ended March
31, 1997. The decrease in interest income on mortgage-back and related
securities of $107,000 or 19.2%, was due to the decrease in the average balance
of $7.1 million or 20.3%.
INTEREST EXPENSE. Interest expense remained unchanged at $1.7 million for the
three months ended March 31, 1997, and for the three months ended March 31,
1996.
PROVISION FOR LOAN LOSSES. The Company established provisions for loan losses
of $33,000 and had a recovery of $51,000 for the three months ended March 31,
1997 and 1996, respectively. In December 1995, a loan was written off based on
the estimated low value of the underlying security and provisions for loan
losses were established. During March 1996, the security was sold yielding a
higher recovery than estimated. The Company's provisions for loan losses for
the three months ended March 31, 1997, approximated charge-offs during such
period and were made to maintain the allowance for loan losses at an adequate
level during that period.
9
<PAGE>
NONINTEREST INCOME. Noninterest income increased by $25,000, or 12.7%, from
$197,000 for the three months ended March 31, 1996 to $222,000 for he three
months ended March 31, 1997.
NONINTEREST EXPENSE. Noninterest expense increased by $620,000, or 47.0%, from
$1.3 million for the three months ended March 31, 1996 to $1.9 million for the
three months March 31, 1997. Such increase was due primarily to a $609,000, or
80.7% increase in compensation and benefits from $755,000 for the three months
ended March 31, 1996, to $1.4 million for the three months ended March 31, 1997.
During the quarter an early retirement program was offered and the approximate
non-recurring cost incurred for those employees who elected early retirement was
$509,000, which represents 83.6% of the increased expense.
INCOME TAX EXPENSE. The Company's income tax expense was estimated at $22,000
and $248,000 for the three months ended March 31, 1997 and 1996, respectively.
10
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary sources of funds are deposits and proceeds from maturing
mortgage-backed and related securities and principal and interest payments on
loans and mortgage-backed and related securities. While maturities and scheduled
amortization of mortgage-backed and related securities and loans are a
predictable source of funds, deposit flows and mortgage payments are greatly
influenced by general interest rates, economic conditions, competition and other
factors.
The primary investing activity of the Company is the purchase of investment
securities. Other investing activities include originations of loans and
purchases of mortgage-backed and related securities. The primary financing
activity of the Company is accepting savings deposits and obtaining short-term
borrowings through FHLB advances.
The Company has other sources of liquidity if there is a need for funds. The
Company has a portfolio of investment securities and mortgage-backed and related
securities with an aggregate market value of $42.1 million at March 31, 1997
classified as available for sale. Another source of liquidity is the Bank's
ability to obtain advances from the FHLB of Chicago. In addition, the Company
maintains a significant portion of its investments in interest-bearing deposits
at other financial institutions that will be available when needed.
The Company anticipates that it will have sufficient funds available to meet
commitments outstanding and to meet loan demand. As of March 31, 1997, the
Bank's ratios of Tier I capital to adjusted total assets was 14.4%, as compared
to the required level of 3.0%, respectively. The risk-based capital ratio at
that date was 24.2%, as compared to the requirement of 8.0%.
11
<PAGE>
PART II. OTHER INFORMATION
-----------------
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) Exhibits - None.
(B) Reports on Form 8-K
On December 31, 1996, the Company filed a Current Report on Form 8-K,
reporting under item 5 that on December 27, 1996, the Company signed an
agreement for the acquisition of American Bancshares, Inc., the holding
company for American Bank of Illinois in Highland.
12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
COMMUNITY FINANCIAL CORP.
Date: May 12, 1997
/s/ Shirley B. Kessler
-----------------------------------------
Shirley B. Kessler
President and Chief Executive Officer
(Director and Principal Executive Officer)
Date: May 12, 1997 /s/ Douglas W. Tompson
-------------------------------------------
Douglas W. Tompson
(Chief Financial Officer)
13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 3-MOS
<FISCAL-YEAR-END> DEC-31-1997 DEC-31-1996
<PERIOD-START> JAN-01-1997 JAN-01-1996
<PERIOD-END> MAR-31-1997 MAR-31-1996
<CASH> 1,143 1,285
<INT-BEARING-DEPOSITS> 2,639 5,458
<FED-FUNDS-SOLD> 7,375 5,875
<TRADING-ASSETS> 0 0
<INVESTMENTS-HELD-FOR-SALE> 42,087 42,309
<INVESTMENTS-CARRYING> 42,791 42,748
<INVESTMENTS-MARKET> 3,234 3,362
<LOANS> 122,309 123,827
<ALLOWANCE> 1,520 1,520
<TOTAL-ASSETS> 182,737 185,799
<DEPOSITS> 138,429 139,100
<SHORT-TERM> 8,963 10,621
<LIABILITIES-OTHER> 1,383 1,996
<LONG-TERM> 0 0
0 0
0 0
<COMMON> 26 26
<OTHER-SE> 33,936 34,056
<TOTAL-LIABILITIES-AND-EQUITY> 182,737 185,799
<INTEREST-LOAN> 2,672 2,500
<INTEREST-INVEST> 830 955
<INTEREST-OTHER> 0 0
<INTEREST-TOTAL> 3,502 3,455
<INTEREST-DEPOSIT> 1,574 1,634
<INTEREST-EXPENSE> 1,690 1,693
<INTEREST-INCOME-NET> 1,812 1,762
<LOAN-LOSSES> 33 (51)
<SECURITIES-GAINS> 0 0
<EXPENSE-OTHER> 1,937 1,318
<INCOME-PRETAX> 64 692
<INCOME-PRE-EXTRAORDINARY> 42 444
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 42 444
<EPS-PRIMARY> .02 .19
<EPS-DILUTED> .02 .19
<YIELD-ACTUAL> 3.27 3.05
<LOANS-NON> 600 239
<LOANS-PAST> 99 236
<LOANS-TROUBLED> 2,188 1,237
<LOANS-PROBLEM> 1,879 3,543
<ALLOWANCE-OPEN> 1,520 1,514
<CHARGE-OFFS> 94 90
<RECOVERIES> 61 195
<ALLOWANCE-CLOSE> 1,520 1,568
<ALLOWANCE-DOMESTIC> 790 815
<ALLOWANCE-FOREIGN> 0 0
<ALLOWANCE-UNALLOCATED> 730 753
</TABLE>
