<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
-------------------------
Form 10-QSB
(Mark One)
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the Quarter Ended September 30, 2000
OR
( ) TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ______to________
Commission file number 000-27244
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USABancShares.com, Inc.
-----------------------
(Exact name of small business issuer as specified in its charter)
Pennsylvania 23-2806495
------------ ----------
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
1535 Locust Street, Philadelphia, PA, 19102
-------------------------------------------
(Address of Principal Executive Offices)
(Zip Code)
(215) 569-4200
---------------
(Registrant's telephone number, including area code)
Securities registered under Section 12(b) of the Act: None
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. YES (X) NO ( )
Transitional Small Business Format: YES ( ) NO (X)
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date:
Common Stock, $1.00 par value, outstanding on November 10, 2000:
5,493,460 shares
Class B Common Stock, $.01 par value, outstanding on November 10, 2000:
10,000 shares, convertible into 216,460 shares of Common Stock
<PAGE>
TABLE OF CONTENTS
-----------------
PART I FINANCIAL INFORMATION Page #
Item 1. Financial Statements
Consolidated Balance Sheets 3
Consolidated Statements of Operations 4
Consolidated Statements of Comprehensive (Loss) Income 5
Consolidated Statements of Changes in Stockholders' Equity 6
Consolidated Statements of Cash Flows 7
Notes to the Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
PART II OTHER INFORMATION
Item 1. Legal Proceedings 20
Item 2. Change in Securities 20
Item 3. Defaults Upon Senior Securities 20
Item 4. Submission of Matters to a Vote of Security Holders 20
Item 5. Other Information 20
Item 6. Exhibits and Reports on Form 8-K 20
SIGNATURES 21
2
<PAGE>
USABANCSHARES.COM, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in Thousands)
<TABLE>
<CAPTION>
(unaudited)
September 30, December 31,
2000 1999
------------- --------------
<S> <C> <C>
ASSETS
Cash and due from banks $ 19,086 $ 3,813
Interest-bearing deposits with banks 1,765 821
Securities available-for-sale 40,664 37,478
Securities held-to-maturity (fair value: 2000 - $63,797;
1999 - $55,595) 69,279 60,337
Federal Home Loan Bank of Pittsburgh (FHLB) stock 4,011 4,011
Loans receivable, net 182,983 197,623
Premises and equipment, net 5,040 2,851
Accrued interest receivable 3,407 2,906
Other real estate owned 40 -
Goodwill, net 47 70
Deferred income taxes 1,502 1,475
Bank owned life insurance 5,356 5,149
Other assets 8,955 6,801
--------- ---------
Total assets $ 342,135 $ 323,335
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Demand $ 5,178 $ 5,168
NOW 33,967 4,692
Money Market 395 973
Savings and Passbook 22,444 19,271
Time 219,620 224,934
--------- ---------
Total deposits 281,604 255,038
Borrowed funds:
Long term borrowings 32,600 35,000
Guaranteed preferred beneficial interests in subordinated debt 10,000 10,000
Accrued interest payable 1,478 4,132
Accrued expenses and other liabilities 1,899 1,237
--------- ---------
Total liabilities 327,581 305,407
STOCKHOLDERS' EQUITY
Preferred stock, $1.00 par value; 5,000,000 authorized shares;
no shares issued and outstanding - -
Common stock, $1.00 par value; 25,000,000 authorized shares;
5,507,974 shares issued and outstanding in 2000; 5,423,784 shares
issued and outstanding in 1999; and 216,460 and 216,460 shares of
converted and unissued Class B common stock in 2000 and 1999,
respectively
actual 5,724,434 shares issued and outstanding in 2000, as adjusted
actual 5,640,244 shares issued and outstanding in 1999, as adjusted 5,724 5,640
Treasury stock (54) -
Additional paid-in capital 15,893 15,368
Accumulated deficit (5,447) (1,378)
Accumulated other comprehensive (loss) - unrealized
depreciation on securities available-for-sale (1,562) (1,702)
--------- ---------
Total stockholders' equity 14,554 17,928
--------- ---------
Total liabilities and stockholders' equity $ 342,135 $ 323,335
========= =========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
3
<PAGE>
USABANCSHARES.COM, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(in Thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
----------------------------------- ----------------------------------
2000 1999 2000 1999
---------------- ---------------- ---------------- ---------------
<S> <C> <C> <C> <C>
Interest income:
Loans $ 14,907 $ 10,024 $ 4,724 $ 4,287
Investment securities 6,997 4,681 2,390 1,973
Interest-bearing deposits and other 1,203 208 391 104
-------- -------- ------- -------
Total interest income 23,107 14,913 7,505 6,364
Interest expense:
Deposits 12,719 6,958 4,301 3,375
Borrowed funds 2,316 1,829 749 665
-------- -------- ------- -------
Total interest expense 15,035 8,787 5,050 4,040
-------- -------- ------- -------
Net interest income 8,072 6,126 2,455 2,324
Provision for loan losses - 1,075 - 825
-------- -------- ------- -------
Net interest income after provision for loan losses 8,072 5,051 2,455 1,499
Non-interest income:
Service fee income 599 150 290 40
(Loss) gain on sales of investment securities (263) 31 (21) -
Gain on sales of loans receivable - 1,402 - 1,361
Gain on sales of other real estate 8 60 - -
Brokerage operations (loss) gain (380) 102 - (91)
Other 341 290 135 156
-------- -------- ------- -------
Total non-interest income 305 2,035 404 1,466
Non-interest expense:
Salaries and employee benefits 2,419 2,273 332 927
Net occupancy expense 770 558 253 216
Professional fees 1,032 367 298 168
Office expenses 473 203 82 102
Data processing fees 1,310 461 587 340
Advertising expense 3,844 1,466 873 1,334
Travel expense 430 217 66 68
Check printing expense 291 - 68 -
Other operating expenses 2,437 901 703 388
-------- -------- ------- -------
Total non-interest expense 13,006 6,446 3,262 3,543
-------- -------- ------- -------
(Loss) income before income tax (benefit) expense (4,629) 640 (403) (578)
Income tax (benefit) expense (558) 279 (195) (15)
-------- -------- ------- -------
Net (loss) income $ (4,071) $ 361 $ (208) $ (563)
======== ======== ======= =======
(Loss) earnings per share - basic (1) $ (0.71) $ 0.09 $ (0.04) $ (0.13)
======== ======== ======= =======
(Loss) earnings per share - diluted (1) $ (0.71) $ 0.07 $ (0.04) $ (0.11)
======== ======== ======= =======
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
(1) All per share data has been adjusted to reflect all stock dividends and
stock splits.
4
<PAGE>
USABANCSHARES.COM, INC. AND SUBSIDIARIES
Consolidated Statements of Comprehensive (Loss) Income
(in Thousands)
(unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-----------------------
2000 1999
------ ------
<S> <C> <C>
Net (loss) income $ (4,071) $ 361
Other comprehensive income (loss)
Unrealized gains (losses) on securities available-for-sale
Unrealized holding gains (losses) arising durng the period,
net of taxes 140 (1,035)
-------- -------
Comprehensive loss $ (3,931) $ (674)
======== =======
Three Months Ended
September 30,
-----------------------
2000 1999
------ ------
<S> <C> <C>
Net loss $ (208) $ (563)
Other comprehensive income (loss)
Unrealized gains (losses) on securities available-for-sale
Unrealized holding gains (losses) arising during the period,
net of taxes 316 (546)
-------- --------
Comprehensive income (loss) $ 108 $ (1,109)
======== ========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
5
<PAGE>
USABANCSHARES.COM, INC. AND SUBSIDIARIES
Consolidated Statements of Changes in Stockholders' Equity
For the nine months ended September 30, 2000
(in Thousands)
(unaudited)
<TABLE>
<CAPTION>
Accumulated
Additional other Total
Common Treasury paid-in Accumulated comprehensive stockholders'
Stock Stock capital deficit loss equity
----------- ----------- ------------- ------------- --------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Balances, December 31, 1999 $ 5,640 $ - $ 15,368 $ (1,378) $ (1,702) $ 17,928
Net unrealized gain on
securities available-for-sale - - - - 207 207
Exercise of options 67 - 309 - - 376
Warrants - - 62 - - 62
Net loss - - - (2,455) - (2,455)
------- ----- -------- --------- -------- --------
Balances, March 31, 2000 $ 5,707 $ - $ 15,739 $ (3,833) $ (1,495) $ 16,118
======= ===== ======== ========= ======== ========
Net unrealized loss on
securities available-for-sale - - - - (383) (383)
Exercise of options 17 - 32 - - 49
Warrants - - 61 - - 61
Net loss - - - (1,406) - (1,406)
------- ----- -------- --------- -------- --------
Balances, June 30, 2000 $ 5,724 $ - $ 15,832 $ (5,239) $ (1,878) $ 14,439
======= ===== ======== ========= ======== ========
Net unrealized gain on
securities available-for-sale - - - - 316 316
Exercise of options - - - - - -
Warrants - - 61 - - 61
Treasury stock - (54) - - - (54)
Net loss - - - (208) - (208)
------- ----- -------- --------- -------- --------
Balances, September 30, 2000 $ 5,724 $ (54) $ 15,893 $ (5,447) $ (1,562) $ 14,554
======= ===== ======== ========= ======== ========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
6
<PAGE>
USABANCSHARES.COM, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(in Thousands)
(unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-------------------------------------
2000 1999
--------------- --------------
<S> <C> <C>
Cash flows from operating activities:
Net (loss) income $ (4,071) $ 361
Adjustments to reconcile net (loss) income to net cash
used in operating activities:
Provision for possible loan losses - 1,075
Depreciation and amortization 403 291
Decrease (increase) of goodwill 23 (2)
Net accretion of discounts on purchased loan portfolios (1,464) (763)
Net accretion/amortization of securities discount/premiums (341) (107)
Net amortization of warrants 184 -
Net losses (gains) on sale of securities 263 (31)
Net gains on sale of loan assets - (1,402)
Net gains on sale of real estate owned (8) (60)
Net increase in deferred fees 22 82
Increase in accrued interest receivable (501) (1,579)
Increase in deferred income taxes (27) (259)
Increase in bank owned life insurance (207) (5,088)
Increase in other assets (2,154) (2,865)
(Decrease) increase in accrued interest payable (2,654) 2,224
Increase in accrued expenses and other liabilities 662 898
-------- -------
Net cash used in operating activities (9,870) (7,225)
-------- -------
Cash flows from investing activities:
Investment securities available-for-sale:
Purchases (11,612) (45,178)
Sales 7,654 1,620
Maturities and principal repayments 875 307
Net realized losses 76 -
Investment securities held-to-maturity:
Purchases (59,286) (11,728)
Sales 1,000 1,200
Maturities and principal repayments 49,379 3,205
Purchases of FHLB Stock - (488)
Increase in interest bearing deposits with banks (944) (4,466)
Principal payments on loans 26,600 12,862
Originations of loans (20,936) (116,884)
Sale/participation of loans 10,432 5,382
(Increase) decrease in other real estate owned (40) 11
Purchases of premises and equipment (2,592) (1,311)
-------- -------
Net cash provided by (used in) investing activities 606 (155,468)
-------- -------
Cash flows from financing activities:
Net increase in deposits 26,566 158,286
Decrease in short-term borrowings - (3,325)
Decrease in long-term borrowings (2,400) -
Exercise of stock options 425 -
Increase in treasury stock (54) -
Proceeds from issuance of trust preferred securities - 10,000
-------- -------
Net cash provided by financing activities 24,537 164,961
-------- -------
Net increase in cash and cash equivalents 15,273 2,268
Cash and cash equivalents, beginning of period 3,813 1,335
-------- -------
Cash and cash equivalents, end of period $ 19,086 $ 3,603
======== =======
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
7
<PAGE>
USABANCSHARES.COM, INC. AND SUBSIDIARIES
Notes to the Consolidated Financial Statements
September 30, 2000
1. Basis of Presentation
The accompanying unaudited consolidated financial statements include the
accounts of USABancShares.com, Inc. (The "Company"), vBank, (the "Bank") a
Pennsylvania chartered stock savings bank, USACredit, Inc., a Pennsylvania
corporation, USARealEstate, Inc., a Pennsylvania corporation and USACapital
Trust I, a Delaware business trust. All significant intercompany accounts and
transactions have been eliminated. The interim financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments including
normal recurring accruals necessary for fair presentation of results of
operations for the interim periods included herein have been made. The unaudited
consolidated financial statements as of September 30, 2000 and for the nine and
three months ended September 30, 2000 and 1999, are not necessarily indicative
of results to be anticipated for the full year.
2. Trust Preferred Securities
On March 9, 1999, the Company issued $10.0 million of 9.5% junior subordinated
debentures to USA Capital Trust I, a Delaware business trust, in which the
Company owns all of the common equity. The trust issued $10.0 million of trust
preferred securities to investors, secured by the junior subordinated debentures
and the guarantee of the Company. The junior subordinated debentures mature in
2029.
3. Secondary Offering
On September 30, 1999 the Company issued 1,400,000 common shares in a secondary
offering. The Company issued these shares at $6.75, with net proceeds of $8.1
million, subsequent to offering costs of $1.4 million.
4. Bondsonline Group, Inc.
In May 2000, the Company and its wholly owned subsidiary, USACapital, Inc.
entered into an Asset Contribution Agreement with Bondsonline, Inc., resulting
in the creation of a new entity known as Bondsonline Group, Inc. Using the
equity method to account for the transaction the Company contributed all of the
issued and outstanding capital stock of USACapital, Inc. in exchange for
5,472,867 shares or 49% of Bondsonline Group, Inc.'s common shares outstanding.
The common stock has a par value of $.001 per share.
5. Computation of Per Share Earnings
Basic earnings per share ("EPS") amounts are computed by dividing net earnings
by the weighted average number of common shares outstanding during the period.
Diluted earnings per share amounts are computed by dividing net earnings by the
weighted average number of shares and all dilutive potential shares outstanding
during the period.
8
<PAGE>
The following information was used in the computation of earnings per share on
both a basic and diluted bases for the nine and three month periods ended
September 30, 2000 and 1999:
(in Thousands, except per share data)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
------------------------------------
2000 1999
----------------- -----------------
<S> <C> <C>
Basic EPS Computation:
Numerator - Net (loss) earnings $ (4,071) $ 361
Denominator - Weighted average shares outstanding 5,705 4,235
-------- ------
Basic (loss) earnings per share (1) $ (0.71) $ 0.09
======== ======
Diluted EPS Computation:
Numerator - Net (loss) earnings $ (4,071) $ 361
Denominator - Weighted average shares outstanding 5,705 4,235
Effect of dilutive securities - 632
-------- ------
Diluted (loss) earnings per share (1) $ (0.71) $ 0.07
======== ======
Three Months Ended
September 30,
------------------------------------
2000 1999
----------------- -----------------
Basic EPS Computation:
Numerator - Net loss $ (208) $ (563)
Denominator - Weighted average shares outstanding 5,713 4,242
-------- ------
Basic loss per share (1) $ (0.04) $(0.13)
======== ======
Diluted EPS Computation:
Numerator - Net loss $ (208) $ (563)
Denominator - Weighted average shares outstanding 5,713 4,242
Effect of dilutive securities - 977
-------- ------
Diluted loss per share (1) $ (0.04) $(0.11)
======== ======
</TABLE>
(1) All per share data has been adjusted to reflect all stock dividends and
stock splits.
There were options to purchase 1,304,168 shares of common stock at a range of
$2.83 to $12.00 per share, which were outstanding at September 30, 2000. These
shares were not included in the computation of diluted earnings per share due to
the net operating losses incurred by the Company for the nine and three months
ended September 30, 2000.
6. New Accounting Pronouncement
In June 1998, the Financial Accounting Standards Board ("FASB") issued
Statements of Financial Accounting Standards ("SFAS") No. 133, "Accounting for
Derivative Instruments and Hedging Activity". SFAS No. 133 establishes
accounting-reporting standards for derivative instruments, including certain
derivative instruments imbedded in other contracts, and for hedging activities.
On April 1, 1999 in conjunction with the adoption of SFAS NO. 133, the Bank
reclassified $33.4 million of securities from available-for-sale to
held-to-maturity. Due to the reclassification, the Bank accreted approximately
$22,500 into equity during the nine months ended September 30, 2000 to restore
the securities back to their carrying value.
9
<PAGE>
USABANCSHARES.COM, INC. AND SUBSIDIARIES
Management's Discussion and Analysis
of Financial Condition and Results of Operations
September 30, 2000
Forward-looking Statements
When used in this Form 10-QSB, the words or phrases "will likely result", "are
expected to", "will continue", "is anticipated", "estimate", "project", or
similar expressions are intended to identify "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995. Such
statements are subject to certain risks and uncertainties including changes in
economic conditions in the Company's market area, changes in policies by
regulatory agencies, fluctuations in interest rates, demand for loans in the
Company's market area, and competition that could cause actual results to differ
materially from historical earnings and those presently anticipated or
projected. The Company wishes to caution readers not to place undue reliance on
any such forward-looking statements, which speak only as to the date made. The
Company wishes to advise readers that the factors listed above could affect the
Company's financial performance and could cause the Company's actual results for
future periods to differ materially from any opinions or statements expressed
with respect to future periods in any current statements.
The Company does not undertake, and specifically disclaims any obligation, to
publicly release the result of any revisions which may be made to any
forward-looking statements to reflect events or circumstances after the date of
such statements or to reflect the occurrence of anticipated or unanticipated
events.
FINANCIAL CONDITION
The Company's total assets increased from $323.3 million at December 31, 1999 to
$342.1 million at September 30, 2000, an increase of $18.8 million, or 5.8%. The
increase was due primarily to increases in cash and due from banks, the
securities portfolio, and premises and equipment, of $15.3 million, $12.1
million, and $2.2 million, respectively offset by a decrease in loans
receivable, net of $14.6 million. The increase in the securities portfolio was
primarily due to the acquisition of federal agency bonds. The increase in cash
and due from banks can be attributed to the growth in deposit liabilities. The
increase in premises and equipment is the result of the purchase of a new
administrative/servicing facility in February 2000, at a cost of approximately
$1.6 million and the increase in improvements of $394,000. In connection with
this acquisition the Company expects to receive in excess of $1.0 million in tax
credits. These increases were partially offset by a decrease in the net loan
portfolio of $14.6 million, partially due to the sale of $4.8 million and the
participation of $6.1 million of loan assets during the second quarter of 2000.
Additionally, repayments and prepayments of loan assets totaled $26.6 million
and were offset by $20.9 million in loan originations.
The growth in total assets was funded by an increase in deposits of $26.6
million. Retail and Internet time deposits increased $52.4 million, transaction
accounts increased $29.3 million, and an increase in savings and passbook
accounts of $3.2 million. These increases were offset by a decrease of $57.7
million in institutional deposits, and a decrease of $600,000 in money market
accounts. The Company's stockholders' equity decreased from $17.9 million at
December 31, 1999 to $14.6 million at September 30, 2000, due to the operating
loss incurred by the Company for the nine months ended September 30, 2000,
partially offset by $425,000 in proceeds received from the exercise of stock
options.
10
<PAGE>
NET INCOME
The Company reported a net operating loss of $4.1 million or $(.71) per diluted
share, for the nine months ended September 30, 2000, compared to net income of
$361,000 or $0.07 per diluted share for the nine months ended September 30,
1999. Net income decreased primarily because of the Company's Internet
initiative and an investment in advertising and personnel to market and support
www.usabancshares.com.
The Company reported a net operating loss of $208,000 or $(.04) per diluted
share, for the three months ended September 30, 2000, compared to a net
operating loss of $563,000 or $(0.11) per diluted share for the three months
ended September 30, 1999. Net income increased primarily because of reduced
advertising expenses between the noted periods.
INTEREST INCOME
Total interest income increased $8.2 million or 54.9% to $23.1 million for the
nine months ended September 30, 2000 compared to the nine months ended September
30, 1999, due to an increase in average earning assets of $110.5 million during
the same time period. Income on loans increased $4.9 million due to the average
earning loan balances increasing $56.4 million, and an increase of $702,000 in
accretion income recognized, primarily due to loan payoffs and loan sales in the
second quarter of 2000. The increase in average loans outstanding was partially
offset by the yield on the loan portfolio decreasing by 51 basis points. Income
on investments increased $2.3 million due to the investment portfolio average
balances increasing $31.7 million between the noted periods. Income on interest
bearing deposits increased $1.0 million due to the average balance of overnight
funds, held at the Federal Home Loan Bank, increasing $18.4 million and an
increase in the overnight funds rate of approximately 270 basis points.
Total interest income increased $1.1 million or 17.9% to $7.5 million for the
three months ended September 30, 2000 compared to the three months ended
September 30, 1999, due to an increase in average earning assets of $35.1
million during the same time period. Income on loans increased $437,000 due to
the average earning loan balances increasing $1.5 million, and an increase in
the yield by 87 basis points. The yield increase was due to an increase of
$175,000 in the accretion income recognized, due to loan payoffs during the
quarter. Income on investments increased $417,000 due to the investment
portfolio average balances increasing $16.5 million between the noted periods.
Income on interest bearing deposits increased $287,000 due to the average
balance of overnight funds, held at the Federal Home Loan Bank, increasing $17.1
million and an increase in the overnight funds rate of approximately 190 basis
points.
INTEREST EXPENSE
Total interest expense increased $6.2 million or 71.1% to $15.0 million, for the
nine months ended September 30, 2000, compared to the nine months ended
September 30, 1999, primarily due to a higher volume of new NOW deposits.
Interest expense on deposits increased $5.8 million, due to the average
outstanding balances increasing $112.0 million and an increase in the average
cost of funds by 53 basis points. The average cost of funds, including other
borrowings, was 6.14% for the nine months ended September 30, 2000 compared to
5.61% over the same period in 1999. The average cost of funds of the Internet
deposits at September 30, 2000 was 5.90%.
Total interest expense increased $1.0 million or 25.0% to $5.0 million, for the
three months ended September 30, 2000, compared to the three months ended
September 30, 1999, due to a higher volume of new time deposits. Interest
expense on deposits increased $926,000, due to the average outstanding balances
increasing $42.1 million and an increase in the average cost of funds by 54
basis points. The average cost of funds, including other borrowings, was 6.22%
for the three months ended September 30, 2000 compared to 5.68% for the same
period in 1999.
11
<PAGE>
NET INTEREST INCOME
The Company's profitability, like that of many financial institutions, is
dependent to a large extent upon net interest income. Net interest income is the
difference between interest income (principally from loans and investment
securities) and interest expense (principally on customer deposits and
borrowings). Changes in net interest income result from changes in the mix of
rates and volumes of interest-earning assets and interest-bearing liabilities
that occur over time. Volume refers to the average dollar level of
interest-earning assets and interest-bearing liabilities. Net interest rate
spread refers to the differences between the average yield on interest-earning
assets and the average cost of interest-bearing liabilities. Net interest margin
refers to net interest income divided by average interest-earning assets.
Net interest income, after the provision for loan losses for the nine months
ended September 30, 2000, increased $3.0 million or 59.8%, to $8.1 million, from
$5.1 million for the same period in 1999. Average interest-earning assets
increased by $110.5 million, or 51.3% to $325.8 million, for the nine months
ended September 30, 2000 compared to the same period in 1999. Average
interest-bearing liabilities increased $117.6 million or 56.3% over the same
period. The net interest spread and the net interest margin decreased for the
period ended September 30, 2000 compared to September 30, 1999, from 3.62% to
3.32% and 3.79% to 3.30%, respectively. For the nine months ended September 30,
2000, $1.5 million of discounts were accreted into interest income or 6.3% of
total interest income. This compares to $763,000 of discount accreted into
interest income for the nine months ended September 30, 1999 or 5.1% of total
interest income. Excluding the income attributable to the accretion of discount
on loans acquired, the net interest margin would have decreased 62 basis points
for the nine months ended September 30, 2000 compared to September 30, 1999 to
2.70% from 3.32%.
Net interest income, after the provision for loan losses for the three months
ended September 30, 2000, increased $956,000 or 63.8%, to $2.5 million, from
$1.5 million for the same period in 1999. Average interest-earning assets
increased by $35.1 million, or 12.3% to $319.1 million, for the three months
ended September 30, 2000 compared to the same period in 1999. Average
interest-bearing liabilities increased $41.0 million or 14.4% over the same
period. The net interest spread and net interest margin declined for the period
ended September 30, 2000 compared to September 30, 1999, from 3.29% to 3.19% and
3.27% to 3.08%, respectively. For the three months ended September 30, 2000,
$370,000 of discount was accreted into interest income or 4.9% of total interest
income. This compares to $195,000, of discount accreted into interest income for
the three month period ended September 30, 1999 or 3.1% of total interest
income. Excluding the income attributable to the accretion of discount on loans
acquired, the net interest margin would have declined 39 basis points for the
three months ended September 30, 2000 compared to September 30, 1999 to 2.61%
from 3.00%.
12
<PAGE>
ANALYSIS OF NET INTEREST INCOME
The following table presents information regarding yields on interest-earning
assets, expense on interest-bearing liabilities, and net yields on
interest-earning assets for the periods indicated:
<TABLE>
<CAPTION>
(in Thousands)
Nine Months Ended September 30,
---------------------------------------------------------------------------------
2000 1999
--------------------------------------- ---------------------------------------
Average Average Average Average
Balance Interest Yield/Rate Balance Interest Yield/Rate
------------ ----------- ----------- ------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Interest-earning assets:
Loans $ 192,665 $ 14,907 10.32% $ 136,249 $ 10,024 9.81%
Investment securities 106,353 6,997 8.77 70,646 4,681 8.83
Interest-bearing deposits and other 26,781 1,203 5.99 8,429 208 3.29
--------- -------- ------ --------- -------- ------
Total interest-earning assets $ 325,799 $ 23,107 9.46% $ 215,324 $ 14,913 9.23%
Interest-bearing liabilities:
Deposits:
NOW $ 17,299 $ 596 4.59% $ 1,394 $ 28 2.68%
Money Market 670 20 3.98 1,856 66 4.74
Savings and Passbook 20,617 615 3.98 15,513 540 4.64
Time 242,489 11,489 6.32 150,315 6,324 5.61
Borrowed funds 45,496 2,315 6.78 39,852 1,829 6.12
--------- -------- ------ --------- -------- ------
Total interest-bearing liabilities $ 326,571 $ 15,035 6.14% $ 208,930 $ 8,787 5.61%
--------- -------- ------ --------- -------- ------
Excess of interest-earning assets over
interest-bearing liabilities $ (772) $ 6,394
========= =========
Net interest income $ 8,072 $ 6,126
======== ========
Net interest rate spread 3.32% 3.62%
====== ======
Net interest margin 3.30% 3.79%
====== ======
Average interest-earning assets to average
interest-bearing liabilities 99.76% 103.06%
====== =======
</TABLE>
13
<PAGE>
RATE VOLUME ANALYSIS
The following schedule presents the dollar amount of changes in interest income
and interest expense for major components of interest-earning assets and
interest-bearing liabilities. It distinguishes between changes (a) related to
outstanding balances and (b) due to changes in interest rates. Information is
provided in each category with respect to: (i) changes attributable to changes
in volume (changes in volume multiplied by prior rate); (ii) changes
attributable to changes in rate (changes in rate multiplied by prior volume);
and (iii) the net change in rate/volume (change in rate multiplied by change in
volume). The changes attributable to the combined impact of volume and rate have
been allocated proportionately to the changes due to volume and the changes due
to rate.
<TABLE>
<CAPTION>
(in Thousands)
September 30, 2000 vs. September 30, 1999
Increase or Decrease
Due to Changes in
------------------------
Total
Average Average Increase
Volume Rate (Decrease)
-------- ------- ----------
<S> <C> <C> <C>
Variance in interest income on
Interest-earning assets
Loans $ 4,151 $ 732 $ 4,883
Securities 2,366 (50) 2,316
Interest-earning deposits and other 453 542 995
------- ------- -------
Total interest-earning assets $ 6,970 $ 1,224 $ 8,194
------- ------- -------
Interest-bearing liabilities
Deposits:
NOW $ (42) $ (4) $ (46)
Money market 178 (103) 75
Savings & Passbook 319 249 568
Time 3,878 1,287 5,165
Borrowings 259 227 486
------- ------- -------
Total interest-bearing liabilities $ 4,592 $ 1,656 $ 6,248
------- ------- -------
Changes in net interest income $ 2,378 $ (432) $ 1,946
======= ======= =======
</TABLE>
PROVISION FOR LOAN LOSSES
Management records the provision for loan losses in amounts that result in an
allowance for loan losses sufficient to cover all potential net charge-offs and
risks believed to be inherent in the loan portfolio. Management's evaluation
includes such factors as past loan loss experience as related to current loan
portfolio mix, evaluation of actual and potential losses in the loan portfolio,
prevailing and national economic conditions that might have an impact on the
portfolio, regular reviews and examinations of the loan portfolio conducted by
bank regulatory authorities, and other factors that management believes deserve
current recognition. As a result of management's evaluation of these factors, no
additions to the provision for loan losses were made during the nine months
ended September 30, 2000. The allowance for loan losses as a percentage of loans
outstanding, net of discount was 1.14% at September 30, 2000, compared to 1.06%
at December 31, 1999 and 1.04% at September 30, 1999. Management will continue
to record a provision for loan losses to maintain the allowance for loan losses
at a level deemed adequate by management on a quarterly basis. The Bank had
charge-offs on loans of $14,000 during the nine months ended September 30, 2000
compared to $43,000 for the nine months ended September 30, 1999. No recoveries
on loans were recorded during the nine months ended September 30, 2000 compared
to $24,000 of recoveries for the same period in 1999.
NON-INTEREST INCOME
Non-interest income decreased $1.7 million to $305,000 for the nine months ended
September 30, 2000. Loss on sale of investments was $263,000 for the nine months
ended September 30, 2000 compared to a gain of $31,000 for the same period in
1999. Gain on sales of loans decreased $1.4 million compared to the nine months
ended September 30, 1999 due to income recognized on loan sales in the period.
Service fee income increased $449,000 due to the growth in deposit accounts, and
other non-interest income reflects an increase of $119,000 due to income on bank
owned life insurance for the nine month period ended September 30, 2000 compared
to the same period in 1999.
Non-interest income decreased $1.1 million to $404,000 for the three months
ended September 30, 2000 compared to the same period in 1999. Service fee income
increased $250,000 due to the growth in deposit accounts, gain on sales of loans
receivable decreased $1.4 million compared to the three months ended September
30, 1999 due to income recognized on loan sales in the period.
<PAGE>
NON-INTEREST EXPENSE
Non-interest expense increased $6.6 million, or 101.8% to $13.0 million, for the
nine months ended September 30, 2000. Advertising expenses increased $2.4
million due to marketing initiatives for the www.usabancshares.com web site.
Office expense, travel and entertainment, and other miscellaneous expenses
increased $2.0 million as a result of the increased efforts to attract
additional customers and strategic partners. Data processing expenses and check
printing expenses increased $849,000 and $291,000, respectively, due to the
growth in deposit accounts. Professional fees increased $665,000 due to an
increase in outside consulting and legal services provided during the nine
months ended September 30, 2000.
14
<PAGE>
Non-interest expense decreased $281,000, or 7.9% to $3.3 million, for the three
months ended September 30, 2000. Salaries and employee benefits expense
decreased $595,000 due to a decrease in staffing and related benefits.
Advertising expenses decreased $461,000. Office expense, travel and
entertainment, and other miscellaneous expenses increased $293,000 as a result
of the increased efforts to attract additional customers. Data processing
expenses and check printing expenses increased $247,000 and $68,000,
respectively, due to the growth in deposit accounts. Professional fees increased
$130,000 due to an increase in outside consulting and legal services provided
during the three months ended September 30, 2000.
INCOME TAX EXPENSE
An income tax benefit of $558,000 was recorded for the nine months ended
September 30, 2000, compared to income tax expense of $279,000 for the nine
months ended September 30, 1999.
LOAN PORTFOLIO
Loans receivable, net (net of the allowance for loan losses, purchase discounts,
and unearned fees and origination costs) was $183.0 million at September 30,
2000 compared to $197.6 million at December 31, 1999. Loans receivable
represented 53.5% of total assets as of September 30, 2000 compared to 61.1% at
December 31, 1999.
The following table summarizes the loan portfolio of the Company by loan
category and amount at September 30, 2000, compared to December 31, 1999:
<TABLE>
<CAPTION>
September 30, December 31,
----------------------------------------------------------------
(in Thousands) 2000 % 1999 %
----------------------------------------------------------------
<S> <C> <C> <C> <C>
Real Estate
1 - 4 family residential properties $ 13,076 7.1% $ 31,729 15.9%
Commercial real estate 137,974 74.4 143,428 71.7
Multifamily residential properties 10,074 5.4 7,726 3.9
Construction 11,527 6.2 9,467 4.7
Commercial and industrial 10,517 5.7 4,688 2.3
Consumer 2,205 1.2 2,967 1.5
-------- ------ --------- -------
Total loans, net of discount $185,373 100.0% $ 200,005 100.0%
======== ====== ========= =======
Deferred loan fees (289) (267)
Allowance for loan losses (2,101) (2,115)
-------- ---------
Net loans $182,983 $ 197,623
======== =========
</TABLE>
At September 30, 2000 the Bank's net discounted loan portfolio amounted to
$103.1 million or 55.6% of total loans net of discount. These loans have a face
value of $106.4 million, reflecting a discount of $3.3 million or 3.1%. At
December 31, 1999 the Bank's net discounted loan portfolio amounted to $121.3
million or 60.7% of total loans net of discount. These loans had a face value of
$126.9 million, reflecting a discount of $5.6 million or 4.4%. At September 30,
2000, and December 31, 1999, the Bank has identified $873,000 and $2.0 million,
respectively, of the purchased loan discount as a cash discount that will not be
amortized into income as a yield adjustment until a final resolution has been
determined for the identified loans. The decrease in the cash discount can be
attributed to the payoff and sale of loan assets from the discounted loan
portfolio during the year.
15
<PAGE>
On September 30, 2000, the net book value of non-accrual loans was approximately
$123,000 compared to $1.3 million at December 31, 1999. The amount of troubled
debt restructured loans totaled $1.6 million as of September 30, 2000 compared
to $1.7 million as of December 31, 1999. The Bank will recognize income on
non-accrual loans, under the cash basis, when the loans are brought current as
to outstanding principal and collateral on the loan sufficient to cover the
outstanding obligation to the Bank. At September 30, 2000 the allowance for loan
losses to non-performing loans, net of discount was 1708.1% compared to 167.1%
at December 31, 1999. The Bank's allowance for loan losses and purchased
discount to total loans net of discount, was 2.9% and 3.8% at September 30, 2000
and December 31, 1999, respectively.
The following table summarized the changes in the Bank's allowance for loan
losses for the period ended September 30, 2000 compared to December 31, 1999:
<TABLE>
<CAPTION>
(in Thousands)
Nine months Twelve months
ended September 30, ended December 31,
2000 1999
-------------------- --------------------
<S> <C> <C>
Balance at beginning of period $ 2,115 $ 1,051
Provision for loan losses - 1,175
Charge-offs (14) (141)
Recoveries - 30
------- -------
Balance at end of period $ 2,101 $ 2,115
======= =======
</TABLE>
INVESTMENT PORTFOLIO
The following table presents the book values and estimated market values at
September 30, 2000, and December 31, 1999, respectively, for each major category
of the Company's investment securities:
<TABLE>
<CAPTION>
(in Thousands)
September 30, 2000
-----------------------------------------------------------------
Gross Gross Approximate
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
--------------- --------------- -------------- ---------------
<S> <C> <C> <C> <C>
Available-for-Sale
U.S. Government and agency
securities $ 4,466 $ - $ (129) $ 4,337
Mortgage-backed securities 8,526 (289) 8,237
Corporate securities 18,652 20 (695) 17,977
Trust preferred securities 9,361 25 (699) 8,687
Other securities 1,474 73 (121) 1,426
------- ----- ------- --------
Total Available-for-Sale $42,479 $ 118 $(1,933) $ 40,664
======= ===== ======= ========
Held-to-Maturity
U.S. Government and agency
securities $14,683 $ 3 $ (177) $ 14,509
Mortgage-backed securities 7,342 37 (74) 7,305
Corporate obligations 16,132 27 (2,327) 13,832
Trust preferred securities 28,709 117 (3,688) 25,138
Municipal securities 3,174 - (161) 3,013
------- ----- ------- --------
Total Held-to-Maturity $70,040 $ 184 $(6,427) $ 63,797
======= ===== ======= ========
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
(in Thousands)
December 31, 1999
-----------------------------------------------------------------
Gross Gross Approximate
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
--------------- --------------- -------------- ---------------
<S> <C> <C> <C> <C>
Available-for-Sale
U.S. Government and agency
securities $ 1,399 $ - $ (51) $ 1,348
Mortgage-backed securities 9,101 - (457) 8,644
Corporate securities 19,326 6 (311) 19,021
Trust preferred securities 7,588 - (608) 6,980
Other securities 2,058 2 (575) 1,485
------- ----- -------- --------
Total Available-for-Sale $39,472 $ 8 $ (2,002) $ 37,478
======= ===== ======== ========
Held-to-Maturity
U.S. Government and agency
securities $ 5,694 $ - $ (262) $ 5,432
Mortgage-backed securities 6,514 8 (152) 6,370
Municipal securities 16,079 - (1,355) 14,724
Trust preferred securities 29,676 139 (3,595) 26,220
Other securities 3,170 - (321) 2,849
------- ----- -------- --------
Total Held-to-Maturity $61,133 $ 147 $ (5,685) $ 55,595
======= ===== ======== ========
</TABLE>
LIQUIDITY
The Company's primary sources of funds are customer deposits, maturity's of
investment securities, sales of "Available-for-Sale" securities, loan sales,
loan repayments, and the use of Federal Funds markets. Scheduled loan repayments
are relatively stable sources of funds while deposit inflows and unscheduled
loan prepayments may fluctuate. Deposit inflows and unscheduled loan prepayments
are influenced by general interest rate levels, interest rates available on
other investments, competition, economic conditions, and other factors. Deposits
are the Company's primary source of new funds. Total deposits increased 10.4% to
$281.6 million at September 30, 2000, compared to $255.0 million as of December
31, 1999. Institutional deposits decreased 34.0% to $111.8 million from $169.5
million. These deposits had a weighted average cost of 6.92%. The Bank has made
a concerted effort to attract deposits through its Internet/retail deposit
products. Management anticipates that the Company will continue relying on
customer deposits, maturity of investment securities, sales of
"Available-for-Sale" securities, loan sales, loan repayments, and the Federal
Funds markets to provide liquidity. Although deposit balances have shown
historical growth, such balances may be influenced by changes in the banking
industry in general, interest rates available on other investments, general
economic conditions, competition and other factors.
17
<PAGE>
The following table summarizes the composition of the Company's deposit
portfolio.
<TABLE>
<CAPTION>
(in Thousands)
September 30, 2000 December 31, 1999
------------------------------- ----------------------------
Amount Percent Amount Percent
--------------- -------------- ------------- -------------
<S> <C> <C> <C> <C>
Demand $ 5,178 1.8% $ 5,168 2.0%
NOW 33,967 12.1 4,692 1.8
Money Market 395 0.1 973 0.4
Savings and Passbook 22,444 8.0 19,271 7.6
Time 219,620 78.0 224,934 88.2
--------- ------- --------- -------
$ 281,604 100.00% $ 255,038 100.00%
========= ======= ========= =======
</TABLE>
The following table summarizes the maturity composition of time deposits at
September 30, 2000, compared to December 31, 1999:
<TABLE>
<CAPTION>
(in Thousands)
September 30, 2000 December 31, 1999
------------------------------- ----------------------------
<S> <C> <C> <C> <C>
Within one year $ 101,287 46.1% $ 142,907 63.5%
Over one year through two years 39,396 17.9 44,860 20.0
Over two years through three years 34,461 15.7 15,996 7.1
Over three years through five years 43,830 20.0 20,450 9.1
Over five years through ten years 646 0.3 721 0.3
--------- ------- --------- -------
$ 219,620 100.00% $ 224,934 100.00%
========= ======= ========= =======
</TABLE>
Borrowings decreased 6.9% to $32.6 million as of September 30, 2000 compared to
$35.0 million at December 31, 1999. The Bank has four outstanding credit
facilities with fixed rates and a conversion feature to an adjustable rate in
the amounts of $5.0 million, $10.0 million, $5.0 million, and $10.0 million,
respectively. These four credit facilities have interest rates of 5.63%, 6.31%,
4.84%, and 5.37%, and conversion dates of September 15, 2003, December 20, 2001,
September 30, 2003, and April 7, 2005, respectively. The conversion rates on
these credit facilities are based on the three month LIBOR rate plus 14 basis
points, 16 basis points, 14.5 basis points, and 13.5 basis points, respectively.
The Company also has a prime based loan in the amount of $2.6 million with a
maturity date of December 16, 2001. Borrowings may be used on a short-term basis
to compensate for reductions in other sources of funds.
CAPITAL RESOURCES
The Bank is subject to various regulatory capital requirements administered by
the federal banking agencies. Failure to meet minimum capital requirements can
initiate certain mandatory and possibly additional discretionary sanctions by
regulators that, if undertaken, could have a material effect on the financial
statements of the Bank. Under capital adequacy guidelines and the regulatory
framework for prompt corrective action, the Bank must meet specific capital
guidelines that involve quantitative measures of the Bank's assets. Liabilities
and certain off-balance sheet items are calculated under regulatory accounting
practices. The Bank's capital amounts and classifications are also subject to
qualitative judgements by the regulators about component, risk weighting and
other factors.
Quantitative measures established by regulation to ensure capital adequacy
require the Bank to maintain minimum amounts and ratios (set forth in the table
below) of Total and Tier I capital (as defined in the regulations) to risk
weighted assets (as defined) and of Tier I capital (as defined) to average
assets (as defined). At September 30, 2000, the Company and the Bank meet all
capital adequacy requirements to which they are subject.
18
<PAGE>
At September 30, 2000 the Bank's actual and required minimum capital ratios
were as follows:
<TABLE>
<CAPTION>
To be well
For the Bank: Capitalized under
------------- For Capital Prompt Corrective
(in Thousands) Adequacy Purposes Action Provisions
As of September 30, 2000: Amount Ratio Amount Ratio Amount Ratio
------------------------- ---------- -------- --------- --------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
Total Capital
(to Risk Weighted Assets) $ 27,280 9.8% $ 22,212 8.0% $ 27,765 10.0%
Tier I Capital
(to Risk Weighted Assets) 25,179 9.1 11,106 4.0 16,659 6.0
Tier I Capital
(to Average Assets) 25,179 7.4 13,574 4.0 16,968 5.0
As of December 31, 1999:
------------------------
Total Capital
(to Risk Weighted Assets) $ 28,266 10.1% $ 22,460 8.0% $ 28,075 10.0%
Tier I Capital
(to Risk Weighted Assets) 26,151 9.3 11,230 4.0 16,845 6.0
Tier I Capital
(to Average Assets) 26,151 7.9 13,171 4.0 16,464 5.0
</TABLE>
At September 30, 2000 the Company's actual and required minimum capital ratios
were as follows:
<TABLE>
<CAPTION>
For the Company:
---------------- For Capital
(in Thousands) Adequacy Purposes
As of September 30, 2000: Amount Ratio Amount Ratio
------------------------- ---------- ---------- ----------- ---------
<S> <C> <C> <C> <C>
Total Capital
(to Risk Weighted Assets) $ 28,151 10.1% $ 22,397 8.0%
Tier I Capital
(to Risk Weighted Assets) 21,416 7.6 11,198 4.0
Tier I Capital
(to Average Assets) 21,416 6.2 13,730 4.0
As of December 31, 1999:
------------------------
Total Capital
(to Risk Weighted Assets) $ 31,331 11.2% $ 22,473 8.0%
Tier I Capital
(to Risk Weighted Assets) 25,645 9.1 11,237 4.0
Tier I Capital
(to Average Assets) 25,645 7.8 13,124 4.0
</TABLE>
On September 30, 1999 the Company issued 1,400,000 common shares in a public
offering. The shares were sold at $6.75 providing the Company with $8.1 million
of net proceeds.
On March 9, 1999 the Company issued $10.0 million of 9.5% junior subordinated
debentures to USA Capital Trust I, a Delaware business trust, in which the
Company owns all of the common equity. The trust issued $10.0 million of trust
preferred securities to investors, secured by the junior subordinated debentures
and the guarantee of the Company. The junior subordinated debentures mature in
2029. The trust preferred securities are Tier I eligible except, in accordance
with Federal Reserve Board regulations, the Company is limited to recognizing
$4.6 million as Tier I capital, such that no more than 25% percent of Tier I
capital is comprised of trust preferred securities. The Company has invested
$6.0 million of the proceeds in the Bank.
19
<PAGE>
PART II
Item 1. Legal Proceedings
-----------------
Neither the Company nor the Bank is involved in any pending legal proceedings
other than routine legal proceedings occurring in the ordinary course of
business. Management believes that such routine legal proceedings, in the
aggregate, are immaterial to the Company's and the Bank's financial condition
and results of operations.
Item 2. Changes in Securities
---------------------
Not Applicable
Item 3. Defaults Upon Senior Securities
-------------------------------
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
Not Applicable
Item 5. Other Information
-----------------
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(A) Exhibits
The following exhibits are filed as part of this report. Exhibit
numbers correspond to the exhibits required by Item 601 of
Regulation S-B.
<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<S> <C>
10.1 Employment agreement between USABancShares.com and Kenneth L. Tepper
10.2 Employment agreement between USABancShares.com and Craig J. Scher
10.3 Agreement by and between Kenneth L. Tepper and USABancShares.com dated January 2,
1998**
10.4 Registration Rights Agreement between USABancShares.com and certain shareholders dated
February 13, 1998**
10.5 Warrant Agreement between USABancShares.com and Sandler O'Neill & Partners, L.P.
dated February 13, 1998**
10.6 Agreement by and between USABancShares.com, Inc. and Earthlink and Systemax*
11 Computation of Per Share Earnings (Included in Financial Statements on Page 9 of this
report)
27 Financial Data Schedule
-------------------------------------------------------------------------------------------------
* Incorporated by reference from the Registration Statement on Form SB-2 of USABancShares.com's,
as amended, Registration No. 33-92506.
** Incorporated by reference form USABancShares.com's Annual Report on Form 10-KSB for the fiscal
year ended December 31, 1999.
</TABLE>
20
<PAGE>
(B) Reports on Form 8-K
On May 25, 2000, the Company filed a current report on Form 8-K
to report the event described in Item 4 of the Notes to the
Consolidated Financial Statements.
SIGNATURES
In accordance with Section 13 or 15(d) 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, in the City of Philadelphia,
Commonwealth of Pennsylvania.
USABancShares.com, Inc.
Date: November 13, 2000 By: /s/ Kenneth L. Tepper
--------------------------------
Kenneth L. Tepper,
President and Chief Executive Officer
(Principal Executive Officer)
Date: November 13, 2000 By: /s/ Daniel J. Machon, Jr.
------------------------------------
Daniel J. Machon, Jr.,
Chief Financial Officer
(Principal Accounting and Financial Officer)
21
