SECURITIES & EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 10-Q
__X__ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2001
_____ 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 33-10149
SVB&T Corporation
1500 Main Street
Jasper, IN 47546
Telephone (812) 634-1010
State of Incorporation - Indiana
I.R.S. Employer Identification No. 35-1539978
NOT APPLICABLE
Former name, former address and fiscal year, if changed 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, and (2) has been subject to the
filing requirements for at least the past 90 days. Yes _X__ No ____
Indicate the number of shares outstanding of each of the issuer's classes of
common stock. The Registrant has one class of common stock (no par value)
with approximately 747,100 shares outstanding at May 10, 2001. The
Registrant holds 52,900 shares in the form of Treasury Stock.
SVB&T CORPORATION
FORM 10-Q
INDEX
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements Page No.
Consolidated Balance Sheet
March 31, 2001 and 2000 and December 31, 2000............... 3
Consolidated Statement of Income
Three months ended March 31, 2001 and 2000.................. 4
Consolidated Statement of Cash Flows
Three months ended March 31, 2001 and 2000................. 5
Consolidated Statement of Changes in Shareholders' Equity
Three months ended March 31, 2001 and 2000.................. 6
Notes to Consolidated Financial Statements................... 7
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations................................... 8-10
PART II. OTHER INFORMATION............................................ 11
SIGNATURES............................................................ 12
SVB&T CORPORATION CONSOLIDATED BALANCE SHEET
March 31, March 31, December 31,
(unaudited) 2001 2000 2000
____________________________________________________________________________
ASSETS:
Cash and due from banks 4,338 4,590 5,824
Federal funds sold 4,240 0 0
Interest bearing deposits in other banks 52 61 49
Total cash and cash equivalents 8,630 4,651 5,873
Investment securities, available for
sale (carried at market value) 23,741 26,097 28,592
Loans
Loans, net of unearned interest 207,155 184,027 204,672
Allowance for loan losses (1,679) (1,662) (1,671)
Net loans 205,476 182,365 203,001
Buildings and equipment 4,538 4,491 4,607
Other real estate 337 0 0
Interest receivable 1,626 1,514 1,886
Deferred income taxes 0 525 0
Other assets 3,032 1,083 3,268
Total Assets 247,380 220,726 247,227
Liabilities:
Deposits
Non-interest bearing demand 12,832 11,884 13,800
Interest bearing 180,087 161,511 172,560
Total Deposits 192,919 173,395 186,360
Federal Funds Purchased 0 3,460 2,765
Other Short Term Borrowings 0 5,000 2,500
Interest payable 1,125 813 964
Deferred income taxes 299 0 134
Other liabilities 898 1,182 935
Long-Term Borrowings 29,100 16,100 31,100
Total Liabilities 224,341 199,950 224,758
SHAREHOLDERS' EQUITY:
Common stock 200 200 200
Capital surplus 6,263 6,211 6,211
Retained earnings 17,282 15,956 17,048
Net unrealized gain (loss) on
investment securities 238 (616) (15)
Treasury stock at cost (52,900 shares) (944) (975) (975)
Total Shareholders' Equity 23,039 20,776 22,469
Total Liabilities and
Shareholders' Equity 247,380 220,726 247,227
(Dollar amounts in thousands)
The accompanying notes are an integral part of this statement.
SVB&T CORPORATION CONSOLIDATED STATEMENT OF INCOME
Three Months Ended March 31,
(unaudited) 2001 2000
____________________________________________________________________________
INTEREST INCOME:
Loans and fees on loans 4,480 3,946
Investment securities:
Taxable 199 271
Non-taxable 183 117
Federal funds sold and securities
purchased under agreements to resell 42 2
Deposits with banks 1 0
Total Interest Income 4,905 4,336
INTEREST EXPENSE:
Deposits 2,270 1,884
Other Short Term Funds Borrowed 2 146
Long-Term Borrowings 471 144
Total interest expense 2,743 2,174
Net interest income 2,162 2,162
Provision for loan losses 180 75
Net interest income after
provision for loan losses 1,982 2,087
NON-INTEREST INCOME:
Trust fees 173 173
Service charges on deposit accounts 128 123
Insurance and claims processing 55 41
Securities gains (losses), net 0 4
Other Income 8 40
Total Non-interest Income 364 381
NON-INTEREST EXPENSE:
Salaries and employee benefits 1,024 925
Premise and equipment expense 266 348
FDIC Deposit expense 5 9
Other expenses 515 427
Total non-interest expense 1,810 1,709
Income before income taxes 536 759
Provision for income tax 167 284
Net Income 369 475
NET INCOME PER COMMON SHARE:
Primary .49 .64
Weighted average common shares
outstanding 747,100 745,028
DIVIDENDS DECLARED:
Cash dividends 0.15 0.15
(Dollars amounts in thousands)
The accompanying notes are an integral part of this statement.
SVB&T CORPORATION CONSOLIDATED STATEMENT OF CASH FLOWS
Three Months Ended March 31,
(unaudited) 2001 2000
____________________________________________________________________________
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income 369 475
ADJUSTMENTS TO RECONCILE NET INCOME TO CASH
PROVIDED FROM OPERATING ACTIVITIES:
Directors Stock Option Compensation 0 1
Depreciation 94 101
Net premium amortization (discount accretion)
of investment securities 4 10
Provision of loan losses 180 75
Decrease(increase) in interest receivable 260 50
(Increase) decrease in other assets (153) (661)
Increase (decrease) in accrued expenses and
other liabilities 124 346
Net cash flows provided by operating
activities 878 397
CASH FLOWS FROM INVESTING ACTIVITIES:
Net increase of interest bearing deposits
in other banks 0 (43)
Purchase of investment securities available
for sale (1,868) (1,536)
Proceeds from maturities and paydowns of
investment securities available for sale 7,184 1,412
Net (increase) decrease in loans (2,655) (9,015)
Purchase of premises and equipment (24) (69)
Net cash flows used in investing
activities 2,637 (9,251)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in deposits and
short-term borrowings
Non-interest bearing demand (968) (10,218)
Total interest-bearing deposits 7,527 2,337
Federal Funds Purchased (2,765) 3,460
Other Short-Term Borrowings (2,500) 0
Long-Term Borrowings (2,000) (7,000)
Cash dividends paid (134) 134
Treasury Stock Sold 82 27
Treasury Stock Purchased 0 0
Net cash flows provided by (used in)
financing activities (758) 2,740
Net increase (decrease) in cash equivalents 2,757 (6,114)
Cash and cash equivalents at beginning of
period 5,873 10,765
Cash and cash equivalents at end of period 8,630 4,651
Total interest paid 2,904 2,145
Total taxes paid 273 333
(Dollars amounts in thousands)
The accompanying notes are an integral part of this statement.
SVB&T CORPORATION CONSOLIDATED STATEMENT
OF CHANGES IN SHAREHOLDERS' EQUITY
Three Months Ended March 31,
(unaudited) 2001 2000
__________________________________________________________________________
Balance, beginning of period 22,469 20,369
Net income 369 475
Cash dividends (133) (134)
Net unrealized gain (loss) on investment
securities 252 (72)
Sales of Treasury Stock 82 138
Purchase of Treasury Stock 0 0
Balance, end of period 23,039 20,776
(Dollar amounts in thousands)
The accompanying notes are an integral part of this statement.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Principles of Consolidation - The consolidated financial statements include
the accounts of SVB&T Corporation and its wholly owned subsidiary, Springs
Valley Bank & Trust Company. All significant intercompany balances and
transactions have been eliminated.
All adjustments which are, in the opinion of management, necessary for a fair
presentation of the results for the periods reported, consisting only of
normal adjustments, have been included in the accompanying unaudited
consolidated condensed financial statements. The results of operations for
three month period ended March 31, 2001 is not necessarily indicative of
those expected for the remainder of the year.
March 31, 2001 March 31, 2000 Dec. 31, 2000
_____________________________________________________________________________
INVESTMENT SECURITIES:
U.S. treasury securities 0 0 0
U.S. Government corporations
& agencies 8,197 13,460 14,923
States and political subdivisions 14,550 10,468 12,742
Mortgage - backed securities 75 130 75
Other domestic securities 869 834 852
Equity Securities 50 1,205 0
Total Investment Securities 23,741 26,097 28,592
March 31, 2001 March 31, 2000 Dec. 31, 2000
_____________________________________________________________________________
LOANS:
Commercial and industrial loans 41,850 27,655 40,868
Real estate loans 105,460 100,303 103,100
Construction loans 17,323 7,129 17,173
Agricultural production financing
and other loans to farmers 2,190 1,852 1,751
Individual loans for household
and other personal expense 39,381 46,549 41,319
Economic development revenue bonds 259 0 0
Lease Financing Receivable 718 348 585
Other Loans Excluding Consumer 53 332 0
Less: Unearned income on loans 119 141 124
Total Loans 207,115 184,027 204,672
(Dollars amounts in thousands)
PART I
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
SUMMARY OF OPERATING RESULTS
EARNINGS ANALYSIS
Net income for the first three months of $369,000 represents a decrease of
$106,000 or 22% from the $475,000 reported for the same period last year.
This resulted from an increase in the allocation for Reserve for Bad Debts
and an increase in the non-interest expenses.
NET INTEREST INCOME
SVB&T Corporation's primary source of earnings is net interest income, which
is the difference between interest earned on loans and other investments and
the interest incurred for deposits and other sources of funds. In the first
three months of 2000, net interest income remained the same compared to first
quarter in 2000. The decreasing interest rates have shrunk the interest
margins due to earning assets repricing more frequently than interest-bearing
deposits. The volume increase has made up for the rate decreases on earning
assets.
OTHER INCOME
Other income of $364,000 for the first quarter of 2001 is $17,000 or 4% less
than the same period for 2000. There were several tractor trailers that the
bank repossessed and sold at a loss of $45,000 during the first quarter of
2001.
OTHER EXPENSES
For the first three months of 2001, other expenses increased by $101,000 to
$1,810,000 compared to $1,709,000 for the same period of 2000. This is due
to a 10% increase in employee benefits and the implementation of imaging in
May of 2000 in the bank. This is an additional expense of $34,000 comparing
year to date 2001 to 2000.
ANALYSIS OF FINANCIAL CONDITION
ALLOWANCE FOR POSSIBLE LOAN LOSSES
The Corporation's allowance for loan losses was $1,679,000 at March 31, 2001
compared to $1,662,000 at March 31, 2000.
At March 31, 2001 the allowance for possible loan losses was .90% of total
loans, net for unearned interest. This compares to an allowance of .90%
at March 31, 2000. Net charge offs for the first three months of 2001 were
$172,000, compared to $40,000 for the same period last year. Management has
increased the monthly loss allocation to $35,000 compared to $25,000 for the
year 2000 and an additional $100,000 allocation for the first quarter of
2001. Based on management's review of the portfolio, management believes the
allowance of $1,679,000 is adequate.
LIQUIDITY AND ASSET/LIABILITY MANAGEMENT
The Corporation's objective in liquidity management is to manage the assets
and liabilities to meet the needs of borrowers while allowing for the
possibility of deposit withdrawals. The primary purpose of asset/liability
management is to minimize the effect on net income of changes in interest
rates and to maintain a prudent match within specified time periods of
rate-sensitive assets and rate-sensitive liabilities.
As of March 31, 2001 the rate-sensitive assets were 65% of rate-sensitive
liabilities in the 1-180 day maturity category and 71% in the 181-365 day
range. These positions are within acceptable ranges as determined by funds
management policy. The Corporation's Funds Management Committee meets weekly
to monitor and effect changes necessary in the liquidity and rate-sensitivity
positions.
CAPITAL
Total shareholders' equity as of March 31, 2001 was $23,039,000 compared to
$20,776,000 for the same period last year. This increase is attributed to
the Net Income for 2000 and the decrease of the net unrealized loss on
investment securities.
(ANALYSIS OF FINANCIAL CONDITIONS CONTINUED)
As of March 31, 2001 the corporation's leverage capital ratio was 8.63% which
compared to 9.26% at March 31, 2000.
As of March 31, 2001 the corporation's total risk-based capital ratio was
12.44% compared to 12.49% at March 31, 2000.
These ratios are in excess of regulatory requirements of 4% for leverage
capital and 8% for total risk-based capital.
PART II
OTHER INFORMATION
Item 1 - LEGAL PROCEEDINGS
None
Item 2 - CHANGES IN SECURITIES
None
Item 3 - DEFAULTS UPON SENIOR SECURITIES
None
Item 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
Item 5 - OTHER INFORMATION
None
Item 6 - EXHIBITS AND REPORTS OF FORM 8-K
None
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.
SVB&T Corporation
(Registrant)
By: Ronald G. Seals
President and Chief Executive Officer
By: David Rees
Principal Financial Officer
Date: May 12, 2001