UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-QSB
/X/ QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended March 31, 2007
/ / TRANSITION REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT
For the transition period from to
Commission file Number 00-16934
BOL BANCSHARES, INC.
(Exact name of small business issuer as specified in its charter.)
Louisiana 72-1121561
(State of incorporation) (IRS Employer Identification No.)
300 St. Charles Avenue, New Orleans, La. 70130
(Address of principal executive offices)
(504) 889-9400
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by
section 13 or 15(d) of the Exchange Act during the past 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
/ /
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practical date: 179,145 SHARES AS OF APRIL
30, 2007.
Transitional Small Business Disclosure Format (Check one): Yes / / No /X/
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BOL BANCSHARES, INC. & SUBSIDIARY
INDEX
Page No.
PART 1. Financial Information
Item 1: Financial Statements
Consolidated Statement of Condition 3
Consolidated Statements of Income 4
Consolidated Statements of Comprehensive Income 5
Consolidated Statement of Cash Flow 6
Item 2: Management's Discussion and Analysis 7
Item 3: Controls and Procedures 8
PART II. Other Information
Item 6. Exhibits 8
Signatures 9
2
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Part I. - Financial Information
BOL BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF CONDITION
March 31, Dec. 31,
(Amounts in thousands) 2007 2006
Unaudited Audited
ASSETS
Cash and Due from Banks
Non-Interest Bearing Balances and Cash $3,484 $4,815
Federal Funds Sold 23,100 23,750
Investment Securities
Securities Held to Maturity 14,000 14,000
Securities Available for Sale 540 536
Loans-Less Allowance for Loan Losses of $1,800 in 2007
and $1,800 in 2006 56,382 57,335
Property, Equipment and Leasehold Improvements
(Net of Depreciation and Amortization) 2,283 2,285
Other Real Estate 1,165 1,165
Other Assets 1,381 1,285
TOTAL ASSETS $102,335 $105,171
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Deposits:
Non-Interest Bearing 44,821 47,447
NOW Accounts 11,217 12,000
Money Market Accounts 4,482 3,722
Savings Accounts 23,505 25,321
Time Deposits, $100,000 and over 607 505
Other Time Deposits 5,022 4,536
TOTAL DEPOSITS 89,654 93,531
Notes Payable 1,544 1,544
Federal Funds Purchased 0 0
Other Liabilities 1,596 973
TOTAL LIABILITIES 92,794 96,048
SHAREHOLDERS' EQUITY
Preferred Stock - Par Value $1
2,089,334 Shares Issued and Outstanding in 2007
2,089,334 Shares Issued and Outstanding in 2006 2,089 2,089
Common Stock - Par Value $1
179,145 Shares Issued and Outstanding in 2007 and 2006
179 179
Accumulated Other Comprehensive Income 280 277
Capital in Excess of Par - Retired Stock 138 138
Undivided Profits 6,440 4,310
Current Earnings 415 2,130
TOTAL SHAREHOLDERS' EQUITY 9,541 9,123
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $102,335 $105,171
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BOL BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended
March 31, March 31,
(Amounts in thousands) 2007 2006
INTEREST INCOME
Interest and Fees on Loans 1,693 1,695
Interest on Investment Securities 121 130
Interest on Federal Funds Sold 303 448
Total Interest Income 2,117 2,273
INTEREST EXPENSE
Interest on Deposits 155 110
Other Interest Expense 4 9
Interest on Notes Payable - -
Interest Expense on Debentures 25 30
Total Interest Expense 184 149
NET INTEREST INCOME 1,933 2,124
Provision for Loan Losses 58 76
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 1,875 2,048
NON-INTEREST INCOME
Service Charges on Deposit Accounts 171 136
Cardholder & Other Credit Card Income 133 152
ORE Income - -
Other Operating Income 39 41
Total Non-Interest Income 343 329
NON-INTEREST EXPENSE
Salaries and Employee Benefits 617 596
Occupancy Expense 277 301
Communications 46 65
Outsourcing Fees 339 390
Loan & Credit Card Expense 36 17
Professional Fees 83 56
ORE Expense 13 4
Other Operating Expense 177 229
Total Non-Interest Expense 1,588 1,658
Income Before Tax Provision 630 719
Provision For Income Taxes 215 245
NET INCOME $415 $474
Earnings Per Share of Common Stock $2.32 $2.65
4
BOL BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
March 31, March 31,
(Amounts in thousands) 2007 2006
NET INCOME $415 $474
OTHER COMPREHENSIVE INCOME, NET OF TAX
Unrealized Holding Gains on Investment
Securities Available-for-Sale, Arising
During the Period 3 -
COMPREHENSIVE INCOME $418 $474
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BOL BANCSHARES, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE THREE MONTHS ENDED MARCH 31,
(Amounts in thousands) 2007 2006
OPERATING ACTIVITIES
Net Income 415 474
Adjustments to Reconcile Net Income (Loss) to Net
Cash Provided by (Used in) Operating Activities:
Provision for Loan Losses 58 76
Depreciation and Amortization Expense 74 71
Amortization of Investment Security Premiums 0 0
Accretion of Investment Security Discounts 0 0
Decrease in Deferred Income Taxes 2 0
(Gain) Loss on Sale of Property and Equipment 0 0
(Gain) Loss on Sale of Other Real Estate 0 0
(Increase) in Other Assets (98) (202)
Increase in Other Liabilities and
Accrued Interest 623 192
Net Cash Provided by Operating Activities 1,074 611
INVESTING ACTIVITIES
Proceeds from Held-to-Maturity Investment Securities
Released at Maturity 0 0
Purchases of Held-to-Maturity Investment Securities 0 0
Proceeds from Sale of Property and Equipment 0 0
Purchases of Property and Equipment (72) (312)
Proceeds from Sale of Other Real Estate 0 0
Net Decrease in Loans 895 1,616
Net Cash Provided by Investing Activities 823 1,304
FINANCING ACTIVITIES
Net (Decrease) Increase in Non-Interest Bearing
and Interest Bearing Deposits (3,878) 3,018
Repayment of Federal Funds Purchased 0 0
Preferred Stock Retired 0 0
Principal Payments on Long Term Debt 0 (2)
Net Cash (Used in) Provided by Financing
Activities (3,878) 3,016
Net (Decrease) Increase in Cash and Cash
Equivalents (1,981) 4,931
Cash and Cash Equivalents - Beginning of Year 28,565 45,032
Cash and Cash Equivalents - End of Period 26,584 49,963
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BOL BANCSHARES, INC.
STATEMENTS OF CASH FLOWS (Continued)
(Unaudited)
SUPPLEMENTAL DISCLOSURES: 2007 2006
Additions to Other Real Estate through Foreclosure - -
Cash Paid for Interest 204 169
Cash (Paid) Received for Income Taxes (196) -
Market Value Adjustment for Unrealized Gain on
Securities Available-for-Sale 4 -
Accounting Policies Note:
Cash Equivalents Include Amounts Due from Banks and Federal Funds Sold.
Generally, Federal Funds are Purchased and Sold for One Day Periods.
ITEM 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS
Internal Control and Assessment Disclosure
Hurricane Katrina Disclosure
Management expects insurance proceeds for storm damages caused by
Hurricane Katrina to cover the majority of damages sustained to the Bank's
branches. The branch locations that the Bank owned directly or indirectly, St.
Charles, Severn, Gause and Tammany, are open and operating, however, branch
locations, wherein the Bank leased the premises, Carrolton and Oakwood, are
still closed with the exception of the drive-thru facility at the Oakwood
location. Management is reviewing new sites to purchase or lease in an effort
to replace the Carrollton location. Management has renewed the Lapalco lease
and the branch was reopened at the end of March 2007. The Oakwood branch will
be reopening at an adjacent site within the Oakwood Shopping Center and is
scheduled to reopen in the 2nd quarter of 2007. The Company's management team
and employees have and are continuing to work diligently to control operating
expenses and costs while restoring normal business operations.
MARCH 31, 2007 COMPARED WITH DECEMBER 31, 2006
BALANCE SHEET
Total Assets at March 31, 2007 were $102,335,000 compared to $105,171,000
at December 31, 2006 a decrease of $2,836,000 or 2.70%. Federal Funds Sold
decreased $650,000 at March 31, 2007 from $23,750,000 at December 31, 2006 to
$23,100,000, cash and due from banks decreased $1,331,000 or 27.64%. This was
mainly attributable to a decrease in the Bank's Federal Reserve Bank account of
$673,000 and a decrease in Cash of $680,000. Total loans decreased $953,000 or
1.66% to $56,382,000 at March 31, 2007 from $57,335,000 at December 31, 2006.
This decrease in the loan portfolio is due mainly to a decrease in the credit
card portfolio of $787,000 which was largely attributable to (i) competition
from other banks and non-traditional credit card issuers; (ii) tightening of
the Bank's underwriting standards; and (iii) normal attrition.
Total deposits decreased $3,877,000 or 4.15% to $89,654,000 at March 31,
2007 from $93,531,000 at December 31, 2006. Total non-interest bearing
deposits decreased $2,626,000 and interest-bearing accounts decreased
$1,251,000.
Shareholder's Equity increased $418,000 due mainly to net income at March
31, 2007 of $415,000.
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THREE MONTHS ENDED MARCH 31, 2007 COMPARED WITH THREE MONTHS ENDED MARCH 31,
2006
INCOME
The Company's net income for the three months ended March 31, 2007 was
$415,000 or $2.32 per share a decrease of $59,000 from the Company's net income
of $474,000 for the same period last year. Interest income decreased $156,000
for the three months ended March 31, 2007 over the same period last year. This
was caused by a decrease of $145,000 in interest received on Federal Funds
sold. This decrease was due mainly to a decrease in the average balance of
Federal Funds sold from $41,492,000 at March 31, 2006 to $23,429,000 at March
31, 2007 and an increase in the rate from 4.32% at March 31, 2006 to 5.17% at
March 31, 2007. As customers repair and renovate their homes after Katrina's
damages, they are withdrawing the funds in their checking and savings accounts.
Interest expense increased $35,000 over the same period last year. This was
due to an increase in the interest rate on interest bearing deposits from a
rate of .75% at March 31, 2006 to a rate of 1.37% at March 31, 2007. Net
interest income decreased $191,000 due to the decrease in the average balance
of Federal Funds sold which was offset by the higher interest rates on interest
bearing deposits. The interest rate spreads increased from 6.67% at March 31,
2006 to 7.33% at March 31, 2007.
Non-interest income increased $14,000 for the three months period as
compared to the same period last year. This increase is due mainly to an
increase in deposit related fees of $35,000 collected on overdrawn accounts
which was offset by a decrease of Cardholder & Other Credit Card Income of
$19,000.
Non-interest expense decreased $70,000 for the three months period as
compared to the same period last year. Occupancy expense decreased $24,000,
due mainly to $32,000 in expenses for Disaster Recovery Service in 2006
compared to $0 in 2007. Outsourcing fees decreased $51,000 due mainly to
credit card development fees of $32,000 in 2006 compared to $0 in 2007. Other
Operating expenses decreased $52,000 due mainly to Katrina losses of $27,000 in
2006 compared to $0 in 2007. Salaries and Employee Benefits increased $21,000,
and Professional fees increased $27,000 over the same period last year.
The provision for income taxes decreased $30,000 compared to the same
period last year from $245,000 at March 31, 2006 to $215,000 at March 31, 2007
due to a decrease in income before taxes.
Item 3 Controls and Procedures
The certifying officers of the Company have evaluated the Company's
disclosure controls and procedures as of a date within 90 days of the filing
date of this report and have concluded that such controls and procedures are
effective. There have been no significant changes in the Company's internal
controls or in other factors that could significantly affect these controls
subsequent to the date of their evaluation.
PART II - OTHER INFORMATION
Item #6 Exhibits
Exhibits
31.1 Section 302 Principal Executive Officer Certification
31.2 Section 302 Principal Financial Officer Certification
32.1 Section 1350 Certification
32.2 Section 1350 Certification
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BOL BANCSHARES, INC.
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
BOL BANCSHARES, INC.
(Registrant)
/s/ G. Harrison Scott
May 10, 2007 G. Harrison Scott
Date Chairman and President
(in his capacity as a duly authorized
officer of the Registrant)
/s/ Peggy L. Schaefer
Peggy L. Schaefer
Treasurer
(in her capacity as Chief Accounting
Officer of the Registrant)
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