UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 0-15536
Codorus Valley Bancorp, Inc.
(Exact name of registrant as specified in its charter)
Pennsylvania 23-2428543
(State of incorporation) (I.R.S. Employer ID No.)
1 Manchester Street, P.O. Box 67, Glen Rock, PA 17327
(Address of principal executive offices) (Zip Code)
(717) 235-6871 or (717) 846-1970
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changes
since last report.)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
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
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Section 12, 13 or
15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court.
Yes No
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
995,785 shares of $2.50 (par value) common stock were
outstanding as of 07-25-95 .
CODORUS VALLEY BANCORP, INC.
10Q INDEX
Page
#
PART I - FINANCIAL INFORMATION:
- Consolidated Statements of Financial Condition... 1
- Consolidated Statements of Income................ 2
- Consolidated Statements of Cash Flows............ 3
- Notes to Consolidated Financial Statements....... 4
- Management's Discussion and Analysis of Financial
Condition and Results of Operations.............. 6
PART II - OTHER INFORMATION ............................... 14
Signature Page ............................................ 16
CODORUS VALLEY BANCORP, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
Unaudited
June 30, December 31, June 30,
1995 1994 1994
--------- --------- ---------
Assets (dollars in thousands)
Cash and due from banks:
Interest bearing deposits with banks $ 319 $ 119 $ 174
Non-interest bearing deposits and cash 5,444 4,873 5,208
Federal funds sold 4,400 1,850 3,400
Securities available for sale 59,850 53,717 54,780
Loans 155,909 150,637 144,618
Less-allowance for loan losses (2,152) (2,249) (1,856)
-------- -------- --------
Total net loans 153,757 148,388 142,762
Premises and equipment 3,206 3,301 3,462
Interest receivable 1,674 1,639 1,654
Other assets 1,409 2,110 1,890
-------- -------- --------
Total assets............................$230,059 $215,997 $213,330
======== ======== ========
Liabilities
Deposits
Non-interest bearing demand $ 14,935 $ 15,177 $ 15,470
NOW 19,141 20,375 20,538
Insured money fund 26,299 29,347 33,114
Savings 21,910 22,497 23,751
Time CD's less than $100,000 110,880 98,822 91,668
Time CD's $100,000 and above 16,061 10,678 10,560
-------- -------- --------
Total deposits 209,226 196,896 195,101
Interest payable 810 852 868
Accrued expenses and other liabilities 249 377 (196)
-------- -------- --------
Total liabilities....................... 210,285 198,125 195,773
Stockholders' Equity
Series preferred stock, par value $2.50
per share; 1,000,000 shares authorized;
0 shares issued and outstanding 0 0 0
Common stock, par value $2.50 per share;
10,000,000 shares authorized; 995,785
shares issued and outstanding for 1995
and 958,621 for 1994. 2,489 2,396 2,396
Capital surplus 5,194 4,428 4,428
Retained earnings 11,645 11,932 10,843
Net unrealized gains(losses) on securities
available for sale, net of taxes 446 (884) (110)
-------- -------- --------
Total stockholders' equity............... 19,774 17,872 17,557
Total liabilities and stockholders'
equity.................................$230,059 $215,997 $213,330
======== ======== ========
See accompanying notes.
1
CODORUS VALLEY BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME
Unaudited
Three months ended Six months ended
June 30, June 30,
(dollars in thousands, except per share data) 1995 1994 1995 1994
------ ------ ------ ------
Interest Income
Interest and fees from loans $3,605 $3,053 $7,047 $6,013
Interest from federal funds sold and interest
bearing deposits with banks 82 19 115 48
Interest and dividends from securities:
Taxable interest income 780 740 1,530 1,500
Tax-exempt interest income 71 59 147 121
Dividend income 12 8 26 23
------ ------ ------ ------
Total interest income.............................. 4,550 3,879 8,865 7,705
Interest Expense
NOW 127 133 253 265
Insured money fund 194 236 397 455
Savings 142 152 286 301
Time CD's less than $100,000 1,497 1,047 2,850 2,111
Time CD's $100,000 and above 214 108 385 237
------ ------ ------ ------
Total interest expense on deposits 2,174 1,676 4,171 3,369
Interest expense on short-term borrowings 0 0 0 1
------ ------ ------ ------
Total interest expense.............................. 2,174 1,676 4,171 3,370
------ ------ ------ ------
Net interest income................................. 2,376 2,203 4,694 4,335
Provision for Loan Losses 31 1,039 32 1,094
------ ------ ------ ------
Net interest income after provision for loan losses 2,345 1,164 4,662 3,241
Non-interest Income
Trust income 72 90 130 178
Service charges on deposit accounts 104 90 198 178
Other service charges and fees 62 50 124 99
Gain (loss) on sales of securities 0 0 (62) 0
------ ------ ------ ------
Total non-interest income 238 230 390 455
Non-interest Expense
Salaries and benefits 877 759 1,716 1,523
Occupancy of premises 107 108 213 234
Furniture and equipment 152 160 308 297
FDIC deposit insurance 111 108 222 217
Professional and legal 56 40 51 69
Marketing and advertising 57 77 102 130
Acquired real estate, net 2 38 37 87
Other 337 308 664 581
------ ------ ------ ------
Total non-interest expense 1,699 1,598 3,313 3,138
Income (loss) before income taxes 884 (204) 1,739 558
Provision for Income Taxes 279 (67) 530 167
------ ------ ------ ------
Net income (loss)...................................$ 605 $ (137) $1,209 $ 391
====== ====== ====== ======
Net income (loss) per common share...................$0.61 ($0.14) $1.21 $0.39
===== ===== ===== =====
See accompanying notes.
2
CODORUS VALLEY BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Unaudited
Six months ended
June 30,
1995 1994
------ -------
Cash Flows From Operating Activities: (dollars in thousands)
Net Income $1,209 $ 391
Adjustments to reconcile net income
to net cash provided by operations:
Depreciation 186 176
Provision for loan losses 32 1,094
Provision for losses on assets acquired in foreclosure 30 63
Loss on sales of securities 62 0
(Increase) decrease in interest receivable (35) (101)
(Increase) decrease in other assets 44 47
Increase (decrease) in interest payable (42) (121)
Increase (decrease) in other liabilities (128) (400)
Other, net (10) 61
------ -------
Net cash provided by operating activities............. 1,348 1,210
Cash Flows From Investing Activities:
Proceeds from sales of securities available for sale 2,345 0
Proceeds from maturities and calls of securities
available for sale 6,288 9,928
Purchase of securities available for sale (12,864) (9,564)
Net increase in loans made to customers (5,997) (5,765)
Proceeds from loan sales 454 330
Purchases of premises and equipment (91) (429)
Proceeds from sale of assets acquired in foreclosure 145 214
------ -------
Net cash used in investing activities..................(9,720) (5,286)
Cash Flows From Financing Activities:
Net increase (decrease) in demand and savings deposits (5,111) 3,980
Net increase (decrease) in time deposits 17,441 (1,604)
Proceeds from issuance of common stock 0 4
Dividends paid (361) (345)
Cash paid in lieu of fractional shares (6) 0
Payment to repurchase common stock (270) 0
------ -------
Net cash (used in) provided by financing activities...11,693 2,035
------ -------
Net increase (decrease) in cash and cash equivalents.. 3,321 (2,041)
Cash and cash equivalents at beginning of year........ 6,842 10,823
Cash and cash equivalents at June 30,................$10,163 $ 8,782
======= =======
Supplemental Disclosures:
Interest payments $4,213 $3,490
Income tax payments $610 $542
See accompanying notes.
3
CODORUS VALLEY BANCORP, INC.
Notes to Consolidated Financial Statements
Note 1-General
The interim financial statements are unaudited. However, they reflect
all adjustments which are, in the opinion of management, necessary to
present fairly the financial condition and results of operations for the
reported periods, and are of a normal and recurring nature.
These statements should be read in conjunction with notes to the
financial statements contained in the 1994 Annual Report to
Stockholders.
No shares of common stock are reserved for issuance in the event of
conversions or the exercise of warrants, options or other rights.
The results of operations for the six month period ended June 30,
1995 are not necessarily indicative of the results to be expected for
the full year.
Note 2-Summary of Significant Accounting Policies
Allowance for Loan Losses - Management considers the allowance for loan
losses (reserve) to be adequate at this time.
Per Share Computations - All per share computations include the
retroactive effect of stock dividends.
Reclassifications - Certain reclassifications have been made to the 1994
consolidated financial statements to conform with the 1995 presentation.
Note 3-Impaired Loans
On January 1, 1995, the Corporation adopted Statement of Financial
Accounting Standards No. 114, "Accounting by Creditors for Impairment of
a Loan", as amended by Statement No. 118, "Accounting by Creditors for
Impairment of a Loan--Income Recognition and Disclosure." Under
Statement No. 114, a loan is considered impaired when, based on current
information and events, it is probable that a creditor will be unable to
collect all amounts due. The Statement requires that impaired loans be
measured based on the present value of expected future cash flows,
discounted at the loan's effective interest rate, or as a practical
expedient, at the loan's observable market price or the fair value of
the collateral if the loan is collateral dependent. If the measure of
the impaired loan is less than its recorded investment a creditor must
recognize an impairment by creating, or adjusting, a valuation allowance
with a corresponding charge to loan loss expense. The Corporation
uses the cash basis method to recognize interest income on loans that
are impaired. All of the Corporation's impaired loans were on a non-
accrual status for all reported periods. Additional information
regarding impaired loans is provided in the schedule that follows.
4
CODORUS VALLEY BANCORP, INC.
Notes to Consolidated Financial Statements, continued
Note 3-Impaired Loans, continued
June 30, December 31, June 30,
(dollars in thousands) 1995 1994 1994
------ ------ ------
Impaired loans $2,381 $1,766 $1,041
Amount of impaired loans that
have a related allowance $2,381 $1,766 $1,041
Amount of impaired loans with
no related allowance $0 $0 $0
Allowance for impaired loans $367 $299 $107
For the six month period ended
June 30,
1995 1994
------ ------
Average investment in impaired loans $2,012 $881
Interest income recognized on
impaired loans (all cash-basis method) $11 $10
Note 4-Analysis of Allowance for Loan Losses
Changes in the allowance for loan losses for the six month period
ended June 30, were as follows:
(dollars in thousands) 1995 1994
------ ------
Balance-January 1, $2,249 $2,000
Provision charged to operating expense 32 1,094
Loans charged off (208) (1,238)
Recoveries 79 0
------ ------
Balance-June 30, $2,152 $1,856
====== ======
5
CODORUS VALLEY BANCORP, INC.
Management's Discussion of Consolidated Financial Condition and
Results of Operations
The consolidated earnings of Codorus Valley Bancorp, Inc. (the Corporation),
were derived from the operations of its wholly-owned subsidiary, Peoples Bank
of Glen Rock (the Bank). The objective of this discussion is to enhance the
reader's understanding of the financial statements, notes to financial
statements, and tables appearing elsewhere in this report.
Three months ended June 30, 1995
compared to three months ended June 30, 1994
RESULTS OF OPERATIONS
Net income for the current three month period was $605,000, compared to a
$137,000 net loss for the same period in 1994. The unusual net loss in the
prior period was the result of loan losses directly attributable to a former
Bank officer. For comparative purposes, net income for the second quarter of
1994 would have approximated $501,000 absent the unusual loan loss. Barring
the sharp reduction in the provision expense for loan losses in the current
period, higher net interest income was the main source of improved Corporate
profits.
An explanation of the factors and trends that caused changes between the two
periods, by major earnings category, follows.
Total interest income for the current three month period was $4,550,000, up
$671,000 or 17.3% above the $3,879,000 earned in the same period of 1994.
The $671,000 increase in interest income was due primarily to improved yields
on a larger volume of loans. Total loans outstanding averaged $153.7 million
during the current quarter, representing a $8.9 million or 6% increase above
the second quarter in 1994. Growth in the consumer loan portfolio, comprised
of mortgage loans and installment loans, outpaced growth in the commercial
loan portfolio.
Total interest expense for the current three month period was $2,174,000, up
$498,000 or 29.7% above the $1,676,000 incurred for the same period in 1994.
The $498,000 increase in interest expense was caused by higher rates paid on
a larger volume of certificates of deposit ("CD's"). Total interest bearing
deposits averaged $189.7 million during the current quarter, representing a
$10.6 million or 5.9% increase above the second quarter of 1994.
Net interest income was $2,376,000 for the current quarter, up $173,000 or
7.9% above the second quarter in 1994, as interest income from loans outpaced
funding costs.
6
CODORUS VALLEY BANCORP, INC.
The provision expense for loan losses was $31,000 for the current quarter
and was incurred primarily to support loan growth. Comparatively, the
provision expense for the second quarter of 1994 was $1,039,000 which
reflected the unusual loan loss previously described.
Total non-interest income for the current three month period was $238,000, up
$8,000 or 3.5% above the $230,000 earned for the same period in 1994 due to
normal business growth.
Total non-interest expense for the current quarter was $1,699,000, up
$101,000 or 6.3% above the $1,598,000 incurred for the same period in 1994.
The increase in total non-interest expense was primarily the result of
greater salaries and benefits expenses incurred to support normal business
growth, branch office expansion, and added control functions.
The provision for income taxes in the current quarter increased $346,000
above the same quarter in 1994 due to the level of pretax earnings.
Six months ended June 30, 1995
compared to six months ended June 30, 1994
RESULTS OF OPERATIONS
Net income for the current six month period was $1,209,000. Comparatively,
the Corporation earned $391,000 for the first six months of 1994, which
included an unusual $137,000 net loss for the second quarter from loan losses
directly attributable to a former Bank officer. For comparative purposes, net
income for the first six months of 1994 would have approximated $1,105,000
absent the unusual loan loss. Earnings per share, adjusted for both periods
to give retroactive effect to the 5% stock dividend declared on April 11,
1995, was $1.21 on June 30, 1995, compared to $.39 on June 30, 1994. For the
six month period (annualized) of 1995, return on average assets (ROA) and
return on average equity (ROE) were 1.1% and 13%, respectively, compared to
0.7% and 8.1%, respectively, for 1994.
At June 30, 1995, total assets were $230 million, reflecting a $17 million or
8% increase above June 30, 1994. Book value per share, adjusted for stock
dividends, was $19.86 on June 30, 1995, compared to $17.46 on June 30, 1994.
The Corporation's capital remained sound as evidenced by a Tier I Risk-Based
Capital Ratio of 12.9% at June 30, 1995.
An explanation of the factors and trends that caused changes between the two
periods, by major earnings category, follows.
Since early January 1995, market interest rates experienced a downward trend
from their sharp ascent in 1994. The decline in market interest rates was in
response to weaknesses in the national economy and low inflation.
7
CODORUS VALLEY BANCORP, INC.
Total interest income for the current six month period was $8,865,000, up
$1,160,000 or 15.1% above the $7,705,000 earned in the same period of last
year. The $1,160,000 increase in interest income was due primarily to
improved yields on a larger volume of loans. Total loans outstanding averaged
$152.8 million during the current six month period at an average taxable
equivalent yield of 8.38%. Comparatively, total loans outstanding averaged
$143.5 million at an average taxable equivalent yield of 7.6% for the same
period in 1994. Growth in the consumer loan portfolio, comprised of mortgage
loans and installment loans, outpaced growth in the commercial loan
portfolio. Loan demand is expected to be weak in the upcoming quarter due
primarily to the summer vacation season.
Total interest expense for the current six month period was $4,171,000, up
$801,000 or 23.8% above the $3,370,000 incurred for the same period in 1994.
The $801,000 increase in interest expense was due to higher rates on a larger
volume of deposits. During the current period, rates paid on interest bearing
demand and savings deposits were comparable to 1994; however, rates paid on
time deposits were higher due to market forces. Total interest bearing
deposits averaged $187.1 million during the current six month period at an
average rate of 4.5%. Comparatively, total interest bearing deposits averaged
$178.3 million at an average rate of 3.8% for the same period in 1994.
Deposit growth is expected to slow in the period ahead presuming that CD
rates decline in response to market interest rates, which are projected to be
relatively stable or moderately decline.
Net interest income was $4,694,000 for the current period, up $359,000 or
8.3% above the same period in 1994, as income from loans outpaced funding
costs. The net yield on earning assets was 4.59% for the first six months of
1995 compared to 4.43% for the same period in 1994.
The provision expense for loan losses was $32,000 for the current six month
period to support the growth in total loans. Comparatively, the provision
expense for the same period in 1994 was $1,094,000 which reflected the
unusual loan loss recognized in the second quarter of that year.
Total non-interest income for the current six month period was $390,000, down
$65,000 or 14.3% below the $455,000 earned for the same period in 1994. The
$65,000 decrease in the current period was caused by two factors. First,
trust income was below the prior year due to a reduction in the estate fee
component which is earned periodically. Second, the current period contained
a $62,000 loss from the sale of investment securities. Approximately $2.4
million in low yielding securities were exchanged for higher yielding
securities to improve overall portfolio yield. The income produced from the
higher yielding securities will more than offset the loss in 1995. To achieve
comparability in non-interest income from normal operations, it is necessary
to exclude the relatively infrequent $62,000 loss on the sale of securities
from current period income. On an adjusted basis, total non-interest income
for the current six month period was comparable to the same period in 1994.
In the period ahead non-interest income, excluding the infrequent securities
8
CODORUS VALLEY BANCORP, INC.
loss, is expected to increase based on normal business growth.
Total non-interest expense for the current six month period was $3,313,000,
up $175,000 or 5.6% above the $3,138,000 incurred for the same period in
1994. The increase in total non-interest expense was primarily the result of
greater salaries and benefits expenses incurred to support normal business
growth, branch office expansion, and added control functions. In the period
ahead, total non-interest expense is expected to increase due to planned
business growth.
The provision for income taxes in the current period increased $363,000
above the same period in 1994 due primarily to greater pretax earnings.
CREDIT RISK AND LOAN QUALITY
Table 1, Nonperforming Assets and Past Due Loans, depicts an upward trend in
the volume of nonperforming assets, and related ratios. An explanation for
this trend is provided below.
Total impaired loans, the major component of total nonperforming assets,
increased $1,340,000 or 129% since June 30, 1994 to a current level of
$2,381,000. Approximately $575,000 of the total increase was attributable to
a single commercial loan account that was classified to nonaccrual status
(e.g., impaired) in December 1994. On July 12, 1995, subsequent to the
effective date of this report, the real estate asset supporting the loan was
sold. Sale proceeds of $550,000 were applied against the outstanding
principal balance and the remaining $25,000 was charged off as a loss. The
Bank financed the purchase to an unrelated party at market terms. Of the
fourteen remaining impaired loans (aggregated by customer) at June 30, 1995,
indebtedness ranges from $20,000 to $326,000. Most of these loans are for
commercial purposes within different industries and are generally
collateralized by real estate assets. Efforts to modify contractual terms for
individual accounts or liquidate collateral assets are proceeding as quickly
as potential buyers can be located and legal constraints permit.
The other component of nonperforming assets, assets acquired in foreclosure
(net of a related reserve) declined since June 30, 1994 to a level of
$695,000. Assets acquired (also known as OREO) consist primarily of improved
real estate from six commercial loan customers in unrelated businesses.
Generally Accepted Accounting Principles require that assets taken in
satisfaction of debt be accounted for on an individual asset basis, at the
lower of (a) fair value minus estimated costs to sell or (b) cost.
Accordingly, the Corporation recorded a $30,000 loss provision for the first
six months of 1995, compared to $62,500 for the same period in 1994, to
reflect a decline in the estimated fair value of assets acquired. Efforts to
liquidate assets acquired are proceeding as quickly as potential buyers can
be located and legal constraints permit.
At June 30, 1995, loans past due 90 days or more and still accruing interest
9
CODORUS VALLEY BANCORP, INC.
totalled $1,239,000, reflecting an increase when compared to the two previous
periods. Approximately $600,000 of the total amount of past due loans at June
30, 1995 was attributable to one commercial loan account. Generally, loans in
this category are well collaterized and in the process of collection.
Subsequent to June 30, 1995, the Bank reclassified two unrelated loan
accounts, which totalled $1,394,000, to nonaccrual status. This decision was
made as a result of failed workout attempts and an increasing degree of
uncooperation from the borrowers. Overall, the underlying collateral
supporting these loans appears adequate. Currently, the Bank is proceeding
with all legal means necessary to collect these debts.
Table 2, Analysis of Allowance for Loan Losses, depicts a $2,152,000
allowance (reserve) at June 30, 1995, which is 1.38% of total loans. The
current allowance was increased above the prior period to support a larger
volume of loans. Based on a recent evaluation of potential loan losses,
management believes that the allowance is adequate to support any reasonably
foreseeable level of losses that may arise. Ultimately, however, the adequacy
of the allowance is largely dependent upon future economic factors beyond the
Corporation's control. With this in mind, additions to the allowance for
loan losses may be required in future periods.
LIQUIDITY
The loan-to-deposit ratio was 74.5% at June 30, 1995, compared to 74.1% at
June 30, 1994. The ratio for both periods was within the 70-80% range that
the Corporation uses for liquidity policy purposes.
STOCKHOLDERS' EQUITY (CAPITAL)
Total stockholders' equity, or capital, was $19,774,000 at June 30, 1995,
compared to $17,557,000 at June 30, 1994. Growth in equity during the current
period was due to earnings retention from profitable operations and an
increase in unrealized gains, net of taxes, on securities available for sale.
On July 11, 1995, the Board of Directors declared a regular quarterly cash
dividend of $.15 per share, payable on or before August 8, 1995, to
stockholders of record July 25, 1995.
Book value per share, adjusted for stock dividends, was $19.86 on June 30,
1995, compared to $17.46 on June 30, 1994.
At June 30, 1995, the Corporation's tier I risk-based capital ratio was 12.9%
and its total risk-based capital ratio was 14.1%. Both capital ratios
exceeded the minimum federal regulatory requirements of 4% and 8%,
respectively.
10
CODORUS VALLEY BANCORP, INC.
On June 28, 1995, the Corporation filed a Form S-3 with the SEC in connection
with the registration of 50,000 shares of the Corporation's common stock for
use in the Corporation's Dividend Reinvestment and Stock Purchase Plan.
Shares may be purchased by stockholders only pursuant to the prospectus
contained in the Registration Statement.
As previously disclosed in the Form 10-K for the period ended December 31,
1994 and the Form 10-Q for period ended March 31, 1995, the Corporation and
the Bank have several capital projects under consideration. A recap of these
projects is as follows: feasibility study for a new corporate headquarters
building; bankwide computer system replacement; and the addition of a full
service banking office. Long term investments in facilities, equipment and
furniture, and systems could reduce Corporate net income and capital growth
in the short term; however, these capital expenditures are deemed necessary
to grow market share and net income over the long term. We believe that these
investments are an important part of the overall strategy to achieve the goal
of enhancing long term shareholder value.
11
CODORUS VALLEY BANCORP, INC.
Table 1 - Nonperforming Assets and Past Due Loans
June 30, December 31, June 30,
(dollars in thousands) 1995 1994 1994
------ ------ ------
Impaired loans $2,381 $1,766 $1,041
Assets acquired in foreclosure,
net of reserve 695 670 955
------ ------ ------
Total nonperforming assets $3,076 $2,436 $1,996
====== ====== ======
Loans past due 90 days or more
and still accruing interest $1,239 $522 $972
Ratios:
Impaired loans as a % of
total period-end loans 1.53% 1.17% 0.72%
Nonperforming assets as a % of
total period-end loans and net
assets acquired in foreclosure 1.96% 1.61% 1.37%
Nonperforming assets as a % of
total period-end stockholders'
equity 15.56% 13.63% 11.37%
Allowance for loan losses as a
multiple of impaired loans .9x 1.3x 1.8x
Interest not recognized on impaired
loans at period-end:(1)
Contractual interest due $199 $125 $81
Interest revenue recognized 11 23 10
---- ---- ---
Interest not recognized in operations $188 $102 $71
==== ==== ===
(1) This table includes interest not recognized on loans which were
classified as impaired at period-end. While every effort is being
made to collect this interest revenue, it is probable a portion will
never be recovered.
12
CODORUS VALLEY BANCORP, INC.
Table 2-Analysis of Allowance for Loan Losses
(dollars in thousands) 1995 1994
------ ------
Balance-January 1, $2,249 $2,000
Provision charged to operating expense 32 1,094
Loans charged off:
Commercial 177 1,230
Real estate-mortgage 0 0
Consumer 31 8
------ ------
Total loans charged off 208 1,238
Recoveries:
Commercial 68 0
Real estate-mortgage 0 0
Consumer 11 0
------ ------
Total recoveries 79 0
------ ------
Net charge-offs 129 1,238
Balance-June 30, $2,152 $1,856
====== ======
Ratios:
Net charge-offs (annualized) to average
total loans .17% 0.96%(1)
Allowance for loan losses to total loans
at period-end 1.38% 1.28%
(1) Net charge-offs for the period ended June 30, 1994 were adjusted for the
unusually large charge-off recorded in June 1994.
13
CODORUS VALLEY BANCORP, INC.
PART II - Other Information:
Item 1. Legal Proceedings
Except as previously reported, in the opinion of the management of the
Corporation and the Bank, there are no proceedings pending to which the
Corporation and the Bank is a party or to which their property is subject,
which, if determined adversely to the Corporation and the Bank, would be
material in relation to the Corporation's and the Bank's undivided profits or
financial condition. There are no proceedings pending other than ordinary
routine litigation incident to the business of the Corporation and the Bank.
In addition, no material proceedings are pending or are known to be
threatened or contemplated against the Corporation and the Bank by government
authorities.
Item 2. Changes in Securities - Nothing to report.
Item 3. Defaults Upon Senior Securities - Nothing to report.
Item 4. Submission of Matters to a Vote of Security Holders -
(a) An annual meeting of shareholders was held on April 25, 1995.
(b), (c) Two matters were voted upon as follows:
(1) The shareholders ratified the selection of Ernst & Young LLP,
Auditors, of Harrisburg, Pennsylvania, as the auditors for the Corporation
for the year ending December 31, 1995. Votes were cast as follows:
789,534 for, 2,918 against, and 8,598 abstentions or broker nonvotes.
(2) Three directors were re-elected, as follows:
Votes Votes
Term cast Against or
Re-elected Expires For Withheld*
Barry A. Keller 1998 794,592 6,458
M. Carol Druck 1998 792,552 8,498
Donald H. Warner 1998 794,246 6,804
*includes broker nonvotes.
Directors whose term continued after the meeting:
Term Expires
Larry J. Miller 1996
D. Reed Anderson, Esq. 1996
MacGregor S. Jones 1996
Dallas L. Smith 1997
George A. Trout, DDS 1997
Rodney L. Krebs 1997
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CODORUS VALLEY BANCORP, INC.
PART II - Other Information, continued:
Item 5. Other Information - Nothing to report.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits - None.
(b) Reports on Form 8-K - none.
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CODORUS VALLEY BANCORP, INC.
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.
Codorus Valley Bancorp, Inc.
(Registrant)
/s/ Larry J. Miller
By_____________________________
(principal executive officer)
Larry J. Miller,
President & CEO
Date: August 4, 1995
/s/ Jann A. Weaver
By_____________________________
(principal financial and
accounting officer)
Jann A. Weaver,
Assistant Treasurer &
Assistant Secretary
Date: August 4, 1995
16