<PAGE>
<PAGE>
FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
Commission File Number: 1-13964
The Southern Banc Company, Inc.
_________________________________________________________________
(Exact name of small business issuer as specified in its charter)
Delaware 63-1146351
- ----------------------- -------------------
(State of incorporation) (I.R.S. Employer
Identification No.)
221 S. 6th Street, Gadsden, Alabama 35901-4102
- --------------------------------------- -----------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: (205) 543-3860
Check whether the issuer (1) filed all reports required
to be filed by Section 13 or 15(d) of the Exchange Act 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 March 31, 1998, there were 1,230,313 shares of the
registrant's Common Stock, par value $0.01 per share, issued and
outstanding.
Transitional small business disclosure format (check
one): Yes No X
--- ---
<PAGE>
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
<PAGE>
<PAGE>
THE SOUTHERN BANC COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollar Amounts in Thousands)
<TABLE>
<CAPTION>
March 31, June 30,
1998 1997
------------ ------------
(Unaudited)
<S> <C> <C>
ASSETS
CASH AND CASH EQUIVALENTS $ 7,576 $ 5,807
SECURITIES AVAILABLE FOR SALE 19,149 17,621
SECURITIES HELD TO MATURITY,
fair values of $38,459 and $44,250,
respectively 37,722 44,157
LOANS RECEIVABLE, net 39,544 36,181
PREMISES AND EQUIPMENT, net 262 267
ACCRUED INTEREST AND DIVIDENDS RECEIVABLE 655 747
PREPAID EXPENSES AND OTHER ASSETS 811 654
-------- --------
TOTAL ASSETS $105,719 $105,434
======== ========
DEPOSITS $ 86,276 $ 86,759
OTHER LIABILITIES 1,051 743
-------- --------
TOTAL LIABILITIES 87,327 87,502
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Preferred stock, par value $.01 per share,
500,000 shares authorized; shares issued
and outstanding -- none 0 0
Common stock, par $.01 per share,
1,454,750 shares issued and
3,500,000 shares authorized. 15 15
Treasury stock at cost, 224,437 shares (3,000) (3,000)
Additional paid-in capital 13,707 13,643
Unearned compensation (1,726) (1,917)
Retained earnings 9,378 9,253
Unrealized gain on securities available
for sale, net 18 (62)
-------- --------
TOTAL STOCKHOLDERS' EQUITY $ 18,392 $ 17,932
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $105,719 $105,434
======== ========
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated statements.
<PAGE>
<PAGE>
THE SOUTHERN BANC COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
For the Three and Nine Month Periods Ended
March 31, 1998 and 1997
(Dollar Amounts in Thousands)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
--------------------- --------------------
1998 1997 1998 1997
---------- --------- -------- --------
(Unaudited) (Unaudited) (Unaudited)(Unaudited)
<S> <C> <C> <C> <C>
INTEREST INCOME
Interest and fees on loans $ 774 $ 684 $ 2,287 $ 2,034
Interest and dividends on
securities available for sale 322 254 934 867
Interest and dividends on securities
held to maturity 693 850 2,180 2,555
Other interest income 60 56 192 208
------- ------- ------- -------
Total interest income 1,849 1,844 5,593 5,664
INTEREST EXPENSE:
Interest on deposits 1,114 1,107 3,414 3,396
------- ------- ------- -------
Net interest income 735 737 2,179 2,268
Provision for loan losses 0 0 0 0
------- ------- ------- -------
Net interest income after
provision for loan losses 735 737 2,179 2,268
------- ------- ------- -------
NON-INTEREST INCOME:
Fees and other non-interest income 31 16 72 48
------- ------- ------- -------
NON-INTEREST EXPENSE:
Salaries and employee benefits 351 351 1,111 1,053
Office building and equipment
expenses 64 74 195 215
Deposit insurance expense 14 3 42 699
Other operating expense 109 117 289 315
------- ------- ------- -------
Total non-interest expense 538 545 1,637 2,282
------- ------- ------- -------
Income before income taxes 228 208 614 34
PROVISION FOR INCOME TAXES 79 78 218 9
------- ------- ------- -------
Net income $ 149 $ 130 $ 396 $ 25
======= ======= ======= =======
EARNING PER SHARE - BASIC $ 0.14 $ 0.10 $ 0.37 $ 0.02
EARNINGS PER SHARE - DILUTED $ 0.13 $ 0.09 $ 0.35 $ 0.02
DIVIDENDS DECLARED PER SHARE $0.0875 $0.0875 $0.2625 $0.4375
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated statements.
<PAGE>
THE SOUTHERN BANC COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended
March 31, 1998 and 1997
(Dollar Amounts in Thousands)
<TABLE>
<CAPTION>
1998 1997
------- -------
(Unaudited) (Unaudited)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 396 $ 25
Adjustments to reconcile net income (loss) to net
cash provided by (used in) operating activities:
Depreciation 36 36
Amortization (accretion), net (18) 61
Amortization of unearned compensation 270 252
Provision for loan losses 0 0
Change in assets and liabilities:
(Increase) decrease in other assets (65) 961
Increase (decrease) in other liabilities 289 (346)
------- -------
Total adjustments 512 964
------- -------
Net cash provided by (used in) operating
activities 908 989
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of securities available for sale (7,298) (4,290)
Proceeds from maturities and principal payments on
securities available for sale 5,881 1,500
Purchases of securities held to maturity (5,004) 0
Proceeds from maturities and principal payments on
securities held to maturity 11,459 7,001
Net loan (originations) repayments (3,363) (2,297)
Capital expenditures (31) (72)
------- -------
Net cash provided by (used in) investing
activities (1,644) 1,842
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase (decrease) in deposits, net (483) 677
Increase (decrease) in advance payments by
borrowers for taxes and insurance (14) 47
Dividends paid (271) (206)
Contributions to plan trusts (50) (380)
Proceeds from exercise of stock options 35 0
Purchase of treasury stock 0 (2,042)
------- -------
Net cash provided by financing activities (783) (1,904)
------- -------
Net increase (decrease) in cash and cash equivalents 1,769 927
CASH AND CASH EQUIVALENTS, beginning of period 5,807 4,535
------- -------
CASH AND CASH EQUIVALENTS, end of period $ 7,576 $ 5,462
======= =======
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid during the period for:
Income taxes $ 130 $ 0
======= =======
Interest $ 3,415 $ 2,299
======= =======
Non-cash transactions:
Change in unrealized net gain on securities
available for sale, net $ 130 $ 35
======= =======
</TABLE>
<PAGE>
<PAGE>
THE SOUTHERN BANC COMPANY, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The Southern Banc Company, Inc. (the "Company") was incorporated
in the State of Delaware in May 1995, for the purposes of
becoming a holding company to own all of the outstanding capital
stock of First Federal Savings & Loan Association of Gadsden
(the "Association") upon the Association's conversion
from a federally chartered mutual savings association to a
federally chartered stock association (the "Conversion"). The
accounting for the conversion is in a manner similar to that
utilized in a pooling of interest.
The accompanying unaudited condensed consolidated financial
statements as of March 31, 1998 and June 30, 1997, and for the
three and nine month periods ended March 31, 1998 and 1997,
include the accounts of the Company, the Association, and the
Association's wholly owned subsidiary, First Service Corporation
of Gadsden. All significant intercompany transactions and
accounts have been eliminated in consolidation.
The condensed consolidated financial statements were prepared by
the Company without an audit, but in the opinion of management,
reflect all adjustments necessary for the fair presentation of
financial position and results of operations for the three and
nine month periods ended March 31, 1998 and 1997. Results of
operations for the current interim period are not necessarily
indicative of results expected for the entire fiscal year.
While certain information and footnote disclosures normally
included in financial statements prepared in accordance with
generally accepted accounting principles have been condensed or
omitted pursuant to the rules and regulations of the Securities
and Exchange Commission, management believes that the
disclosures herein are adequate to make the information
presented not misleading. These condensed consolidated
financial statements should be read in conjunction with the
consolidated financial statements and notes thereto
included in the Company's annual report on Form 10-KSB for the
year ended June 30, 1997. The accounting policies followed by
the Company are set forth in the summary of significant
accounting policies in the Company's June 30, 1997 consolidated
financial statements.
2. STOCK CONVERSION
On October 5, 1995, the Conversion of the Association from a
Federally chartered mutual institution to a Federally chartered
stock savings association through amendment of its charter and
issuance of common stock to the Company was completed. Related
thereto, the Company sold 1,454,750 shares of common stock, par
value $.01 per share, at an initial price of $10 per share in
subscription and community offerings. Costs associated with the
Conversion were approximately $880,000, including underwriting
fees. The conversion costs were deducted from the gross
proceeds of the sale of the common stock.
3. RETIREMENT AND SAVINGS PLANS
Employee Stock Ownership Plan
In connection with the Conversion, the Association established
an employee stock ownership plan (the "ESOP") for eligible
employees. The ESOP purchased 116,380 shares of the Company's
common stock with the proceeds of a $1,163,800 note payable from
the Association and secured by the Common Stock owned by the
ESOP. Unearned compensation for the ESOP was charged to
stockholders' equity and is reduced ratably in connection with
principal payments under the terms of the plan. Unearned
compensation is amortized into compensation expense based on
employee services rendered in relation to shares which are
committed to be released.
<PAGE>
<PAGE>
Management Recognition Plan
During fiscal 1996, the Association established a management
recognition plan (the "MRP") which purchased 58,190 shares of
the Company's common stock on the open market subsequent to the
Conversion. The MRP provides for awards of common stock to
directors and officers of the Association. A trust was formed
for the purpose of purchasing shares of stock in the open market
for future awards of stock options under the MRP Plan. The
aggregate fair market value of the shares purchased by the MRP
is considered unearned compensation at the time of purchase and
compensation is earned ratably over the stipulated vesting
period. Unearned compensation related to the MRP is shown as a
reduction to shareholders' equity in the accompanying
consolidated statements of condition. The Plan held 45,685
issued and outstanding shares at March 31, 1998.
Stock Option and Incentive Plan
The Company has a stockholder approved Option and Incentive Plan
(the "Option Plan"). The Option Plan provides for the grant of
incentive stock options (ISO's) to employees and non-incentive
stock options (non-ISO's) to non-employee directors. The
exercise price is based on the market price of the common stock
on the date of grant. A trust was formed for the purpose of
purchasing shares of stock in the open market for issuance upon
future exercises of stock options under the Option Plan. The
Plan held 33,275 issued and outstanding shares at March 31,
1998.
Simplified Employee Pension Plan
The Company established a Simplified Employee Pension Plan
("SEP") for all employees who have completed one year of
service, pursuant to Section 408(k) of the Internal Revenue Code
of 1986. The Company makes a discretionary contribution to the
SEP on an annual basis.
4. EARNINGS PER SHARE
Basic earnings per share were computed by dividing net income by
the weighted average number of shares of common stock
outstanding during the three and nine month periods ended March
31, 1998 and 1997. Common stock outstanding consists of issued
shares less treasury stock, unallocated ESOP shares, and
shares owned by the MRP and Stock Option plan trusts. Diluted
earnings per share for the three and nine month periods ended
March 31, 1998 and 1997, were computed by dividing net income by
the weighted average number of shares of common stock and the
dilutive effects of the shares awarded under the MRP and
the Stock Option plans, based on the treasury stock method using
an average fair market value of the stock during the respective
periods.
In 1997, the Company adopted SFAS No 128, "Earnings Per Share,"
effective December 15, 1997. As a result, the Company's
reported earnings per share for 1996 were restated. The
following table represents the earnings per share calculations
for the three and nine months ended March 31, 1998 and 1997,
accompanied by the effect of this accounting change on
previously reported earnings per share:<PAGE>
<TABLE>
<CAPTION>
Earnings
Income Shares Per Share
------ ------ ---------
<S> <C> <C> <C>
For the Three Months Ended:
- --------------------------
March 31, 1998
Net income $149,000
--------
Basic earnings per share:
Income available to common
shareholders 149,000 1,059,533 $ 0.14
--------
Dilutive Securities:
Management recognition plan shares 32,590
Stock option plan shares 37,880
-------- ---------
Dilutive earnings per share:
Income available to common
shareholders plus assumed
conversions $149,000 1,130,003 $ 0.13
-------- --------- --------
<PAGE>
<PAGE>
March 31, 1997
Net income $130,000
--------
Basic earnings per share:
Income available to common
shareholders 130,000 1,043,937 $ 0.12
Dilutive Securities: --------
Management recognition plan shares 32,590
Stock option plan shares 19,131
-------- ---------
Dilutive earnings per share:
Income available to common
shareholders plus assumed
conversions $130,000 1,095,658 $ 0.12
-------- --------- --------
For the Nine Months Ended:
- --------------------------
March 31, 1998
Net income $396,000
--------
Basic earnings per share:
Income available to common
shareholders 396,000 1,057,808 $ 0.37
Dilutive Securities: --------
Management recognition plan shares 32,590
Stock option plan shares 33,302
Dilutive earnings per share: -------- ---------
Income available to common
shareholders plus assumed
conversions $396,000 1,125,700 $ 0.35
-------- --------- --------
March 31, 1997
Net income $ 25,000
---------
Basic earnings per share:
Income available to common
shareholders 25,000 1,106,694 $ 0.02
--------
Dilutive Securities:
Management recognition plan shares 32,590
Stock option plan shares 14,801
---------- ---------
Dilutive earnings per share:
Income available to common
shareholders plus assumed
conversions $ 25,000 1,154,085 $ 0.02
--------- --------- --------
Changes in previously reported EPS: For the period ended March 31, 1997
-----------------------------------
Three Months Nine Months
------------ -----------
Earnings per share, as reported $0.12 $0.02
Earnings per share, as restated:
Basic $0.12 $0.02
Diluted $0.12 $0.02
</TABLE>
5. FDIC ASSESSMENT
The Association's deposits are insured by the Savings
Association Insurance Fund ("SAIF"), which is administered by
the Federal Deposit Insurance Corporation ("FDIC"). Congress
passed legislation requiring a one-time special assessment of
65.7 basis points to be applied against SAIF-assessable
deposits as of March 31, 1995. The Association recognized an
expense at September 30, 1996 in the amount of $591,000 to
record the one-time special assessment.
<PAGE>
<PAGE>
6. PENDING ACCOUNTING PRONOUNCEMENTS
The AICPA has issued Statements of Position 98-1, "Accounting
for the Costs of Computer Software Developed or Obtained for
Internal Use". This statement requires capitalization of
external direct costs of materials and services; payroll and
payroll-related costs for employees directly associated; and
interests cost during development of computer software for
internal use (planning and preliminary costs should be
expensed). Also, capitalized costs of computer software
developed or obtained for internal use should be amortized on a
straight-line basis unless another systematic and rational
basis is more representative of the software's use.
This statement is effective for financial statements for fiscal
years beginning after December 15, 1998 (prospectively) and is
not expected to have a material effect on the consolidated
financial statements.
<PAGE>
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Comparison of Financial Condition at March 31, 1998 and June 30,
1997.
Total assets increased approximately $285,000 or 0.27% from
$105.4 million at June 30, 1997 to $105.7 million at March 31,
1998. During the period ended March 31, 1998, net loans
increased approximately $3.4 million or 9.29%, securities
available for sale increased approximately $1.5 million or 8.67%
and securities held to maturity decreased approximately $6.4
million or 14.57%. The decrease in securities held to maturity
was primarily attributable to principal payments received during
the period ended March 31, 1998.
Cash and cash equivalents increased approximately $1.8 million
or 30.46% from $5.8 million to $7.6 million at March 31, 1998.
The increase in cash and cash equivalents was primarily
attributable to the proceeds from maturities and principal
payments on securities available for sale and held to maturity.
Accrued interest and dividends receivable decreased
approximately $92,000 or 12.32% from $747,000 at June 30, 1997
to $655,000 at March 31, 1998. Prepaid expenses and other
assets increased approximately $157,000 or 24.01% from
$654,000 at June 30, 1997 to $811,000 at March 31, 1998.
Total deposits decreased approximately $483,000 or 0.56% from
$86.8 million at June 30, 1997 to $86.3 million at March 31,
1998. Other liabilities during the period ended March 31, 1997
increased approximately $308,000 or 41.45% from $743,000 at June
30, 1997 to $1.1 million at March 31, 1998. This increase was
primarily attributable to an increase in accrued federal and
state income taxes.
Total equity increased approximately $460,000 or 2.57% from
$17.9 million at June 30, 1997 to $18.4 million at March 31,
1998. This change was primarily attributable to an increase in
retained earnings, additional paid-in capital, and amortization
of unearned compensation, offset in part by the payment of
common stock dividends. Treasury stock at March 31, 1998 was
$3.0 million.
Comparison of Results of Operations for the Three and Nine
Months Ended March 31, 1998 and 1997.
The Company reported net income for the three and nine month
periods ended March 31, 1998 of $149,000 and $396,000,
respectively. Net income for the three month period increased
approximately $19,000 or 14.62% from $130,000 at March 31, 1997
to $149,000 at March 31, 1998. For the nine month period, net
income increased approximately $371,000 or 1,484.00% from
$25,000 at March 31, 1997 to $396,000 at March 31, 1998. The
increase in net income for the nine month period ended March 31,
1998 was primarily attributable to a reduction in deposit
insurance expense, offset in part by an increase in income tax
expense. Net income during the nine month period ended March
31, 1997 included the recognition of the one-time special
assessment of approximately $591,000 by the FDIC, offset in part
by a $69,000 reduction in income tax expense.
Net Interest Income. Net interest income for the three and nine
months ended March 31, 1998 was $735,000 and $2.2 million,
respectively. Net interest income for the three and nine months
ended March 31, 1997 was $737,000 and $2.3 million,
respectively. Total interest income increased approximately
$5,000 or 0.27% for the three months ended March 31, 1998.
Total interest income decreased approximately $71,000 or 1.25%
for the nine month period ended March 31, 1998. Total interest
expense increased approximately $7,000 or 0.63% for the three
months ended March 31, 1998 compared with the three month period
ended March 31, 1997. Total interest expense increased
approximately $18,000 or 0.53% for the nine months ended March
31, 1998 compared with the nine months ended March 31, 1997.
Provision for Loan Losses. No provision for loan losses was
deemed necessary in either of the three month or nine month
periods ended March 31, 1998 or 1997. The allowance for loan
losses is based on management's evaluation of possible loan
losses inherent in the Association's loan portfolio. Management
considers, among other factors, past loss experience, current
economic conditions, volume, growth and composition of the loan
portfolio, and other relevant factors.
<PAGE>
<PAGE>
Non-interest Income. Non-interest income increased
approximately $15,000 or 93.75% from $16,000 to $31,000 for the
three month period ended March 31, 1998 compared to the three
month period ended March 31, 1997. For the nine month
period ended March 31, 1998 non-interest income increased
approximately $24,000 or 50.00% from $48,000 to $72,000.
Non-interest Expense. Non-interest expense decreased
approximately $7,000 or 1.28% for the three month period ended
March 31, 1998 from $545,000 to $538,000. For the nine month
period ended March 31, 1998, non-interest expense decreased
approximately $645,000 or 28.26% from $2.3 million to $1.6
million. This decrease was primarily attributable to the
reduction in deposit insurance expense related to the
recognition of the one-time special assessment by the FDIC in
the amount of $591,000 during the nine month period
ended March 31, 1997. Salaries and employee benefits remained
level at approximately $351,000 for the three month period ended
March 31, 1998 compared with the three month period ended March
31, 1997. For the nine month period ended March 31, 1998,
salaries and benefits increased $58,000 or 5.51% compared with
the nine month period ended March 31, 1997. This increase was
primarily attributable to salary and benefit expenses related to
the establishment of certain employee benefit plans, subsequent
to the conversion. Other operating expenses decreased by $8,000
or 6.84% and $26,000 or 8.25% for the three and nine month
periods ended March 31, 1998 and 1997, respectively. This
decrease was primarily attributable to reduced operating
expenses relating to the operation of the holding company and
professional fees associated with back-office operational
improvements.
Provision for Income Taxes. For the three month period ended
March 31, 1998, provision for income tax expense increased
approximately $1,000 or 1.28%. For the nine month period ended
March 31, 1998, provision for income tax expense increased
approximately $209,000 or 2,322.22%. This increase was
primarily attributable to a reduction in deposit insurance
expense related to the recognition of the one-time special
assessment by the FDIC in the amount of $591,000 during the nine
month period ended March 31, 1997. For the three month period
ended March 31, 1998, income before income taxes increased
approximately $20,000 or 9.62% as compared to the three month
period ended March 31, 1997. For the nine month period ended
March 31, 1998, income before income taxes increased
approximately $580,000 or 1,705.88% compared to the nine month
period ended March 31, 1997.
Liquidity and Capital Resources. As a holding company, the
Company conducts its business through its subsidiary, the
Association. The Association is required to maintain minimum
levels of liquid assets as defined by regulations of the Office
of Thrift Supervision. This requirement, which varies from time
to time depending upon economic conditions and deposit flows, is
based upon a percentage of deposits and short-term borrowings.
The required ratio currently is 4.0%. The Association's average
liquidity ratio well exceeded the required maximums at and
during the three and nine month periods ended March 31, 1998.
The Association adjusts its liquidity levels in order to meet
funding needs of deposit outflows, repayment of borrowings and
loan commitments. The Association also adjusts liquidity as
appropriate to meet its asset and liability management
objectives.
The Association's primary sources of funds are deposits, payment
of loans and mortgage-backed securities, maturities of
investment securities and other investments. While scheduled
principal repayments on loans and mortgage-backed securities are
a relatively predictable source of funds, deposit flows and loan
prepayments are greatly influenced by general interest
rates, economic conditions, and competition. The Association
invests in short-term interest-earning assets which provide
liquidity to meet lending requirements.
The Association is required to maintain certain levels of
regulatory capital. At March 31, 1998, the Association exceeded
all minimum regulatory capital requirements.
Year 2000 Compliance. The Company has evaluated its operations
and information systems to identify and address risk associated
with the year 2000. Based on present information, Management
does not believe that its related costs with year 2000
compliance will be material.
<PAGE>
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
From time to time, the Company and any subsidiaries may
be a party to various legal proceedings incident to its or their
business. At March 31, 1998, there were no legal proceedings to
which the Company or any subsidiary was a party, or to which any
of their property was subject, which were expected by management
to result in a material loss.
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
On April 16, 1998, The Southern Banc Company, Inc.
announced a dividend in the amount of $.0875 per share on or
about June 15, 1998 to stockholders of record at the close of
business on May 15, 1998.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K
None
<PAGE>
<PAGE>
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.
THE SOUTHERN BANC COMPANY
Date: May 12, 1998 By: /s/ James B. Little, Jr.
----------------------------
James B. Little, Jr.
(Principal Executive and
Financial Officer)
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-END> MAR-31-1998
<CASH> 240
<INT-BEARING-DEPOSITS> 7,336
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 19,149
<INVESTMENTS-CARRYING> 37,722
<INVESTMENTS-MARKET> 38,459
<LOANS> 39,620
<ALLOWANCE> 76
<TOTAL-ASSETS> 105,719
<DEPOSITS> 86,276
<SHORT-TERM> 0
<LIABILITIES-OTHER> 1,051
<LONG-TERM> 0
<COMMON> 15
0
0
<OTHER-SE> 18,377
<TOTAL-LIABILITIES-AND-EQUITY> 105,719
<INTEREST-LOAN> 2,287
<INTEREST-INVEST> 3,114
<INTEREST-OTHER> 192
<INTEREST-TOTAL> 5,593
<INTEREST-DEPOSIT> 3,414
<INTEREST-EXPENSE> 0
<INTEREST-INCOME-NET> 2,179
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 1,637
<INCOME-PRETAX> 614
<INCOME-PRE-EXTRAORDINARY> 614
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 396
<EPS-PRIMARY> 0.37
<EPS-DILUTED> 0.35
<YIELD-ACTUAL> 7.73
<LOANS-NON> 0
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 0
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 0
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
