Exhibit 99.1
MFB Corp.
Proforma Balance Sheet
As of March 31, 2004
(In thousands)
Sobieski
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Subsequent
Balance
MFB Corp. Sheet
3/31/2004 3/31/2004 Adjustments (1) Adjusted 3/31/04 Adjustments (2)
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Assets
Cash and due from financial institutions $6,576 $2,619 -$547 $2,072 $3,179
Interest - bearing deposits 17,185 7,154 - 7,154 (3,821)
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Total cash and cash equivalents 23,761 9,773 (547) 9,226 (642)
Securities available for sale 34,021 27,759 - 27,759 6,014
Other Investments 10,580 1,997 - 1,997 20
Loans held for sale 2,902 298 - 298 2,813
Loans receivable 331,861 62,516 (2,174) 60,342 (12,785)
Less: allowance for loan losses (5,320) (2,232) 1,617 (615) 152
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Loans receivable, net 326,541 60,284 (557) 59,727 (12,633)
Accrued interest receivable 1,470 393 - 393 69
Premises and equipment, net 14,670 2,687 (82) 2,605 (230)
Cash surrender value of life insurance 5,337 148 (148) - -
Repossessed assets - 2,285 (2,285) - -
Goodwill and other intangible assets - - - - -
Other assets 7,252 3,242 (2,210) 1,032 (565)
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Total Assets 426,534 108,866 (5,829) 103,037 (5,154)
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Liabilities and Shareholders' Equity
Liabilities
Total deposits 289,203 69,845 - 69,845 (748)
FHLB advances 97,990 33,100 - 33,100 -
Other liabilities 3,975 1,245 (95) 1,150 13
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Total liabilities 391,168 104,190 (95) 104,095 (735)
Total shareholders' equity 35,366 4,676 (5,734) (1,058) (4,419)
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Total Liabilities and Shareholders' Equity $426,534 $108,866 ($5,829) $103,037 ($5,154)
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[TABLE CONTINUED ON FOLLOWING PAGE]
1
[TABLE CONTINUED FROM PREVIOUS PAGE]
Sobieski
----------- Purchase Pro Forma
Adjusted Adjustments Balance Sheet
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Assets
Cash and due from financial institutions $5,251 $0 $11,827
Interest - bearing deposits 3,333 (522) (3) 19,996
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Total cash and cash equivalents 8,584 (522) (3) 31,823
Securities available for sale 33,773 - 67,794
Other Investments 2,017 - 12,597
Loans held for sale 3,111 - 6,013
Loans receivable 47,557 3,420 (4) 382,838
Less: allowance for loan losses (463) - (5,783)
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Loans receivable, net 47,094 3,420 (4) 377,055
Accrued interest receivable 462 - 1,932
Premises and equipment, net 2,375 1,076 (5) 18,121
Cash surrender value of life insurance - - 5,337
Repossessed assets - - -
Goodwill and other intangible assets - 5,091 (6) 5,091
Other assets 467 51 (7) 7,770
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Total Assets 97,883 9,116 533,533
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Liabilities and Shareholders' Equity
Liabilities
Total deposits 69,097 1,000 (8) 359,300
FHLB advances 33,100 2,639 (9) 133,729
Other liabilities 1,163 - 5,138
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Total liabilities 103,360 3,639 498,167
Total shareholders' equity (5,477) 5,477 35,366
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Total Liabilities and Shareholders' Equity $97,883 $9,116 $533,533
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Footnote references
(1) To remove balances not acquired in the transaction based on March 31, 2004
balances.
(2) To reflect changes in Sobieski's balance sheet from April 1, 2004 through
the purchase date and to reflect additional balances not acquired in the
transaction.
(3) Estimated cash paid to Sobieski under purchase agreement
(4) To adjust acquired loans to estimated fair market value
(5) To adjust acquired premises and equipment to estimated fair market value
(6) To recognize goodwill of approximately $2.3 million, core deposit
intangible of $1.6 million and customer relationship intangible of $1.2
million.
(7) To adjust acquired mortgage servicing rights to estimated fair market value
(8) To adjust acquired time deposits to estimated fair market value.
(9) To adjust acquired Federal Home Loan Bank advances to estimated fair market
value.
1 (CONTINUED)
Proforma Income Statement
For YE 9-30-03
MFB Corp.
Proforma Income Statement
Year Ending September 30, 2003
(In thousands, except for per share data)
MFB Corp. Sobieski Purchase Pro Forma
9/30/2003 9/30/2003 Adjustments (1) Adjustments (2) Income
Interest Income
Loans receivable, including fees $20,641 $5,362 $0 ($598) $25,405
Securities 1,951 1,056 - - 3,007
Other interest income 341 118 - - 459
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Total Interest Income 22,933 6,545 - (598) 28,880
Interest Expense -
Deposits 5,800 2,513 - (766) 7,547
FHLB advances and other borrowings 6,444 2,011 - (802) 7,653
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Total interest expense 12,244 4,524 - (1,568) 15,200
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Net Interest Income 10,689 2,021 - 970 13,680
Provision for loan losses 1,110 1,461 (1,411) - 1,160
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Net interest income after provision for loan losses 9,579 560 1,411 970 12,520
Noninterest income -
Service charges and fees 1,623 304 - - 1,927
Trust fee income 464 - - 464
Insurance commissions 187 - - 187
Net realized gains from sales of loans 3,395 584 - - 3,979
Loan servicing fees, net of amortization of MSR (940) (165) - - (1,105)
Other income 297 1,029 (1,052) - 274
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Total noninterest income 5,026 1,752 (1,052) - 5,726
Noninterest expense -
Salaries and employee benefits 6,802 1,968 - - 8,770
Data processing 596 243 - - 839
Occupancy and equipment expense 1,558 321 - 14 1,893
Other expense 2,578 1,530 (255) 582 4,435
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Total noninterest expense 11,534 4,062 (255) 596 15,937
Income before income taxes 3,071 (1,750) 614 374 2,309
Income tax expense 671 (356) (94) 150 371
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Net Income $2,400 ($1,394) $708 $224 $1,938
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Basic earnings per common share $1.87 $1.51
Diluted earnings per common share $1.80 $1.46
Weighted average shares outstanding for
basic earnings per share 1,286 1,286
Weighted average shares outstanding for
diluted earnings per share 1,330 1,330
2
MFB Corp.
Proforma Income Statement
Six months ending March 31, 2004
(In thousands, except for per share data)
Purchase Proforma
MFB Corp. Sobieski Adjustments (1) Adjustments (2) Income
Interest Income
Loans receivable, including fees $10,075 $1,963 $0 ($299) $11,739
Securities 801 573 - - 1,374
Other interest income 97 7 - - 104
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Total Interest Income 10,973 2,543 - (299) 13,217
Interest Expense -
Deposits 2,671 1,018 - (383) 3,306
FHLB advances and other borrowings 2,747 976 - (401) 3,322
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Total interest expense 5,418 1,994 - (784) 6,628
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Net Interest Income 5,555 549 - 485 6,589
Provision for loan losses 500 428 (403) 525
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Net interest income after provision for
loan losses 5,055 121 403 485 6,064
Noninterest income -
Service charges and fees 1,421 152 - - 1,573
Trust fee income 257 - - - 257
Insurance commissions 92 - - - 92
Net realized gains from sales of loans 545 42 - - 587
Other Income 354 (748) 831 - 437
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Total noninterest income 2,669 (554) 831 - 2,946
Noninterest expense -
Salaries and employee benefits 3,398 1,006 - - 4,404
Data processing 277 171 - - 448
Occupancy and equipment expense 1,221 199 - 7 1,427
Other expense 1,758 849 (113) 291 2,785
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Total noninterest expense 6,654 2,225 (113) 298 9,064
Income before income taxes 1,070 (2,658) 1,347 187 (54)
Income tax expense 98 1,106 (1,625) 75 (346)
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Net Income $972 ($3,764) $2,972 $112 $292
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Basic earnings per common share $0.75 $0.22
Diluted earnings per common share $0.71 $0.21
Weighted average shares outstanding for
basic earnings per share 1,303 1,303
Weighted average shares outstanding for
diluted earnings per share 1,371 1,371
3
MFB Corp.
Proforma Income Statement
Six months ending March 31, 2003
(In thousands, except for per share data)
Purchase Proforma
MFB Corp. Sobieski Adjustments(1) Adjustments (2) Income
Interest Income
Loans receivable, including fees $10,575 $2,813 $0 ($299) $13,089
Securities 1,147 666 - - 1,813
Other interest income 143 21 - - 164
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Total Interest Income 11,865 3,500 - (299) 15,066
Interest Expense -
Deposits 3,003 1,345 - (383) 3,965
FHLB advances and other borrowings 3,369 1,004 - (401) 3,972
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Total interest expense 6,372 2,349 - (784) 7,937
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Net Interest Income 5,493 1,151 485 7,129
Provision for loan losses 900 1,004 (979) - 925
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Net interest income after provision for loan losses 4,593 147 979 485 6,204
Noninterest income -
Service charges and fees 602 89 - - 691
Trust fee income 226 - - - 226
Insurance commissions 84 - - - 84
Net realized gains from sales of loans 1,908 413 - - 2,321
Other Income (95) 1,369 (1,299) - (25)
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Total noninterest income 2,725 1,871 (1,299) - 3,297
Noninterest expense -
Salaries and employee benefits 3,307 917 - - 4,224
Data processing expense 361 135 - - 496
Occupancy and equipment expense 731 180 - 7 918
Other expense 1,289 757 (145) 291 2,192
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Total noninterest expense 5,688 1,989 (145) 298 7,830
Income before income taxes 1,630 29 (175) 187 1,671
Income tax expense 399 27 (85) 75 416
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Net Income $1,231 $2 ($90) $112 $1,255
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Basic earnings per common share $0.95 $0.97
Diluted earnings per common share $0.92 $0.94
Weighted average shares outstanding for
basic earnings per share 1,298 1,298
Weighted average shares outstanding for
diluted earnings per share 1,335 1,335
Footnote references
(1) To adjust Sobieski's historical financial statements to remove the effects of certain transactions related to
various fraudulent and otherwise unauthorized loan matters. Sobieski's tax expense has been adjusted to
approximate MFB's incremental effective tax rate.
(2) Estimated impact of (amortization)/accretion of purchase accounting adjustments. The following table shows the
estimated (amortization)/accretion of purchase accounting adjustments in thousands for the periods indicated.
2 months ending 12 months ending
9/30/04 9/30/05 9/30/06 9/30/07 9/30/08 9/30/09
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Loan purchase accounting adjustment ($103) ($593) ($431) ($374) ($340) ($304)
Time deposit purchase accounting adjustment 178 705 117 - - -
Federal Home Loan Bank purchase accounting adjustment 157 802 547 457 378 149
Premises and equipment purchase accounting adjustment (2) (14) (14) (14) (14) (14)
Amortizable intangible assets (97) (559) (435) (385) (336) (286)
4