<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended JUNE 30, 1996
COMMISSION FILE NUMBER 33 ACT FILE NO.-33-90524
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VALRICO BANCORP, INC.
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(Exact name of registrant as specified in its Charter)
(FLORIDA) 65-0553757
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1815 EAST STATE ROAD 60, VALRICO, FLORIDA 33594
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(Address of principal executive offices and zip code)
(813) 689-1231
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(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. (1) Yes X (2) No
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As of June 30, 1996, there were 297,345 shares of common stock outstanding.
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VALRICO BANCORP, INC.
INDEX
PART I. FINANCIAL INFORMATION PAGE NUMBER
- - ----------------------------- -----------
Item 1. Financial Statements (Unaudited):
Consolidated balance sheets- June 30, 1996
and December 31, 1995 3
Consolidated statements of income- Three
months ended June 30, 1996 and 1995; Six
months ended June 30, 1996 and 1995 4
Consolidated statement of shareholders'
equity- Six months ended June 30, 1996 and
1995 5
Consolidated statements of cash flows- Six
months ended June 30, 1996 and 1995 6
Notes to consolidated financial statements 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8-9
PART II. OTHER INFORMATION 10
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SIGNATURES 11
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VALRICO BANCORP, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
<TABLE>
<CAPTION>
June 30 December 31
1996 1995
----------- -----------
<S> <C> <C>
ASSETS:
Cash and due from banks $ 3,358,269 $ 2,327,055
Federal funds sold 4,550,000 3,323,000
Securities available for sale 7,228,573 5,106,911
Securities to be held to maturity 3,181,382 2,918,379
Loans, net of allowance for loan losses 33,399,398 33,191,038
Facilities 1,060,270 1,149,928
Other real estate 0 178,272
Accrued interest receivable 373,474 375,488
Other assets 1,045,885 1,022,063
----------- -----------
Total assets $54,197,251 $49,592,134
=========== ===========
LIABILITIES:
Deposits:
Demand deposits $ 8,992,138 $ 6,557,640
NOW deposits 8,460,648 7,860,346
Money market deposits 5,048,145 3,938,092
Savings deposits 6,555,619 5,935,241
Time deposits (under $100,000) 16,271,109 16,544,783
Time deposits ($100,000 and over) 4,167,403 3,937,520
----------- -----------
Total deposits 49,495,062 44,773,622
Federal funds purchased 0 0
Securities sold under agreements to repurchase 471,273 389,641
Accounts payable and accrued liabilities 562,419 833,395
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Total liabilities 50,528,754 45,996,658
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STOCKHOLDERS' EQUITY:
Common stock, No par value, authorized
1,000,000 shares, issued and outstanding
297,345 shares for 1996; 299,279 for 1995 297,345 299,279
Capital surplus 2,320,419 2,323,160
Retained earnings 1,140,925 1,008,662
Net unrealized holding losses on securities (90,192) (35,625)
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Total stockholders' equity 3,668,497 3,595,476
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Total liabilities and stockholders' equity $54,197,251 $49,592,134
=========== ===========
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
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CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
June 30 June 30
1996 1995 1996 1995
---------- -------- ---------- ----------
<S> <C> <C> <C> <C>
Interest income:
Interest and fees on loans $ 828,544 $782,779 $1,664,816 $1,512,179
Interest on investment securities 156,003 140,905 267,776 283,519
Income on Federal funds sold 61,292 27,410 123,658 38,564
---------- -------- ---------- ----------
Total interest income 1,045,839 951,094 2,056,250 1,834,262
---------- -------- ---------- ----------
Interest Expense:
Interest on deposits 373,689 346,853 749,632 664,441
Interest on Federal funds purchased and
securities sold under agreements to repurchase 4,203 2,464 7,191 6,606
---------- -------- ---------- ----------
Total interest expense 377,892 349,317 756,823 671,047
---------- -------- ---------- ----------
Net interest income 667,947 601,777 1,299,427 1,163,215
Provision for loan losses 20,000 5,000 55,000 60,000
---------- -------- ---------- ----------
Net interest income after provision
for loan losses 647,947 596,777 1,244,427 1,103,215
---------- -------- ---------- ----------
Other income:
Service charges on deposit accounts 85,818 78,542 163,212 159,782
Miscellaneous income 21,807 7,859 42,101 43,702
---------- -------- ---------- ----------
Total other income 107,625 86,401 205,313 203,484
---------- -------- ---------- ----------
Other expense:
Salaries and employee benefits 292,796 217,822 580,671 431,375
Occupancy expense 94,720 88,172 189,241 172,826
Equipment expense 67,925 41,377 136,564 82,734
Stationery, printing, and supplies 22,916 13,337 42,443 27,487
Miscellaneous expenses 125,515 171,638 256,104 323,828
---------- -------- ---------- ----------
Total other expenses 603,872 532,346 1,205,023 1,038,250
---------- -------- ---------- ----------
Income before provision for federal income tax 151,700 150,832 244,717 268,449
Income taxes 60,500 53,850 93,921 96,700
---------- -------- ---------- ----------
Net Income $ 91,200 $ 96,982 $ 150,796 $ 171,749
---------- -------- ---------- ----------
Per Share Information:
Average shares outstanding 297,345 302,779 297,345 302,779
---------- -------- ---------- ----------
Net income per share $ 0.307 $ 0.320 $ 0.507 $ 0.567
---------- -------- ---------- ----------
</TABLE>
See Accompanying Notes to Cosolidated Financial Statements
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VALRICO BANCORP, INC.
CONSOLIDATED STATEMENTS OF STOCKOLDERS' EQUITY (UNAUDITED)
SIX MONTHS ENDED JUNE 30, 1996 AND 1995
<TABLE>
<CAPTION>
Net unrealized Total
Common Capital Retained holding Losses stockholder
stock surplus earnings on securities equity
-------- ---------- ---------- ------------- ----------
<S> <C> <C> <C> <C> <C>
Balance at December 31, 1995 $299,279 $2,323,160 $1,008,662 ($35,625) $3,595,476
Net income 150,796 150,796
Net change in net unrealized
holding losses on securities (54,567) (54,567)
Transfer 12,093 (12,093) 0
Stock redeemption (1,934) (14,834) (6,440) (23,208)
Balance at June 30, 1996 $297,345 $2,320,419 $1,140,925 ($90,192) $3,668,497
======== ========== ========== ======== ==========
Balance at December 31, 1994 $302,779 $2,301,511 $ 727,321 ($93,223) $3,238,388
Net income 171,749 171,749
Cash dividends 0 0
Net change in net unrealized
holding losses on securities 44,119 44,119
Transfer 0 0 0 0 0
-------- ---------- ---------- -------- ----------
Balance at June 30, 1995 $302,779 $2,301,511 $ 899,070 ($49,104) $3,454,256
======== ========== ========== ======== ==========
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
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VALRICO BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30
1996 1995
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<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 150,796 $ 171,749
Adjustments to reconcile net loss to net cash
Provided by operating activities:
Provision for loan losses 55,000 60,000
Provision for depreciation and amortization 98,035 95,188
Net amortization (accretion) of investments
security premiums and discounts (25,199) 15,387
(Increase) decrease in assets:
Accrued interest receivable 2,014 11,115
Other assets (23,822) (138,623)
(Increase) decrease in liabilities:
Accounts payable and accrued liabilities (275,374) 50,854
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Net cash provided by operating activities (18,550) 265,670
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CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of investment securites (3,819,982) (100,000)
Proceeds from sale of investment securites 0 0
Proceeds from maturities of investment securities 1,435,316 409,715
(Increase) decrease deferred income tax (24,969) (22,726)
(Increase) decrease in Federal funds sold (1,227,000) (2,597,000)
(Increase) decrease in loans (263,360) (1,505,291)
Purchase of facilities (8,377) (183,831)
ORE 178,272 0
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Net cash used in investing activities (3,730,100) (3,999,133)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Increase in deposits 4,721,440 4,101,129
Decrease in Federal funds purchased 0 0
Increase in securities sold under
agreements to repurchase 81,632 174,000
Redemption of common stock (23,208) 0
Dividends 0 0
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Net cash provided by financing activities 4,779,864 4,275,129
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NET INCREASE IN CASH 1,031,214 541,666
CASH,BEGINNING OF YEAR 2,327,055 1,939,416
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CASH, END OF YEAR $ 3,358,269 $ 2,481,082
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SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash Paid During the Period For:
Interest $ 530,213 $ 786,213
Income Tax $ 96,643 $ 95,242
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
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<PAGE> 7
VALRICO BANCORP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 1996
(UNAUDITED)
BASIS OF PRESENTATION
Valrico Bancorp, Inc., a one-bank holding company acquired 100% stock of
Valrico State Bank as of May 31, 1995. Therefore, the unaudited consolidated
financial statements include the accounts of Valrico Bancorp, Inc. (the
Company) and its wholly owned subsidiary, Valrico State Bank (the Bank).
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions of Form 10-Q. Accordingly,
they do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. Significant
intercompany balances and transactions have been eliminated in the consolidated
financial statements.
Net income per share has been computed by dividing net income by the average
number of common shares outstanding of 297,345 shares as of June 30, 1996 and
302,779 as of June 30, 1995. During 1996, $23,208 was paid to purchase 1,934
common shares from the Company's shareholders.
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VALRICO BANCORP, INC.
MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The Company's primary asset is its subsidiary bank, which has just completed
its seventh full year of operation as of June 23, 1996. The Bank deposits were
$49,495,062 an increase of $4,721,440 or 10.55% as of June 30, 1996. Demand
deposits, primarily non-interest bearing had the highest percentage of growth
at 37.1% or an increase of $2,434,498 as of June 30, 1996.
Loan demand had soften during the first quarter and the Bank experienced a
decline in loans. Agricultural lines of credit which are normally drawn
against during the first quarter actually experienced a decline in
outstandings. However, loan demand improved during the second quarter and as of
June 30, 1996 loans had increase $208,360 or .63% since the end of 1995. The
allowance for credit losses at June 30, 1996 was $459,674 compared to $491,563
at December 31, 1995. The Bank had $94,096 in write offs and recoveries in
the amount of $7,207 during the six months ended June 30, 1996. The Bank had
three nonperforming loans totaling $188,040 or .55% of total loans at June 30,
1996. A total of $55,000 has been expensed for provision for loan losses as of
June 30, 1996. Management considers the allowance to be adequate at this time.
Due to the strong growth in deposits and the soft loan demand the first
quarter, the Bank purchased a total of $3,819,982 in securities such as
Treasuries, Agencies, and Municipals.
Consolidated net income for the first six months was $150,796 or $.507 per
share which compares to $171,749 or $.567 per share for the first six months
ended June 30, 1995. While this represents a decline over the comparable
quarter of $20,953, the first six months of 1996 includes expenses related to
our second branch which opened in September, 1995 and continues to have a
negative impact to net income. As of June 30, 1996, the year to date total
expenses for the Plant City branch were $145,864 and the net income after
expenses was a loss of $55,139. However, the branch continues to grow and
earnings continue to improve on a monthly basis. Breakeven is expected within
15 to 18 months. Our first branch which opened April 1994 had
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positive earnings for the first time in December 1995 and has had positive
earnings throughout the six months of 1996.
Salaries and benefits represent 48.2% of noninterest expenses for the six
months ended June 30, 1996 compared to 41.5% for the six months ended June 30,
1995. Salary expense for the six months ended June 30, 1996 increased 34.6%
over the same period for 1995, however the cost of our second branch personnel
was experienced throughout the six months period in 1996 as stated above.
The Tier I capital ratio was 6.93% and the total capital ratio was 7.78% at
June 30, 1996. The Tier I capital ratio to total risk-weighted assets was
10.07% and total capital ratio to total risk-weighted assets was 11.32% at June
30, 1996.
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<PAGE> 10
VALRICO BANCORP, INC.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
Exhibit 27 Financial Data Schedule
No reports on Form 8-K were filed for the quarter ended June 30, 1996.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
VALRICO BANCORP, INC.
August 7, 1996 By: Larry R. Tracy
- - -------------- -----------------------------------
(Date) Larry R. Tracy,
President and Chief Executive
Officer
August 7, 1996 By: Jerry L. Ball
- - -------------- ----------------------------------
(Date) Jerry L. Ball,
Executive Vice President
and Cashier
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<PAGE> 12
EXHIBIT INDEX
Exhibit
No. Description Page
- - ------- ----------- ----
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 9
<CIK> 0000942789
<NAME> VALRICO BANCORP, INC.
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 3,358
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 4,550
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 7,229
<INVESTMENTS-CARRYING> 3,181
<INVESTMENTS-MARKET> 3,159
<LOANS> 33,859
<ALLOWANCE> 460
<TOTAL-ASSETS> 54,197
<DEPOSITS> 49,495
<SHORT-TERM> 0
<LIABILITIES-OTHER> 1,034
<LONG-TERM> 0
0
0
<COMMON> 297
<OTHER-SE> 3,371
<TOTAL-LIABILITIES-AND-EQUITY> 54,197
<INTEREST-LOAN> 1,665
<INTEREST-INVEST> 391
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 2,056
<INTEREST-DEPOSIT> 750
<INTEREST-EXPENSE> 757
<INTEREST-INCOME-NET> 1,299
<LOAN-LOSSES> 55
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,205
<INCOME-PRETAX> 245
<INCOME-PRE-EXTRAORDINARY> 151
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 151
<EPS-PRIMARY> .507
<EPS-DILUTED> .507
<YIELD-ACTUAL> 5.27
<LOANS-NON> 188
<LOANS-PAST> 43
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 615
<ALLOWANCE-OPEN> 492
<CHARGE-OFFS> 94
<RECOVERIES> 7
<ALLOWANCE-CLOSE> 460
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
