===============================================================================
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 SEPTEMBER 30, 2000
/ / TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT FOR THE TRANSITION PERIOD FROM __________ TO __________
COMMISSION FILE NUMBER 0-28894
ACCESS ANYTIME BANCORP, INC.
(Name of small business issuer in its charter)
DELAWARE 85-0444597
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) No.)
801 PILE STREET, CLOVIS, NEW MEXICO 88101
(Address of principal executive (Zip Code)
offices)
Issuer's telephone number, including area code: (505) 762-4417
SECURITIES REGISTERED UNDER SECTION 12(b) OF THE EXCHANGE ACT: NONE
SECURITIES REGISTERED UNDER SECTION 12(g) OF THE EXCHANGE ACT:
COMMON STOCK $.01 PAR VALUE
(Title of class)
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 / /
1,242,747 Shares of Capital Stock $.01 par value
Outstanding as of October 25, 2000
Transitional Small Business Disclosure Format (check one): Yes / / No /X/
===============================================================================
TABLE OF CONTENTS
Page
----
Report of Independent Accountants....................................................... 3
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
Unaudited Condensed Consolidated Statements of Financial Condition.... 4
Unaudited Condensed Consolidated Statements of Operations............. 5
Unaudited Condensed Consolidated Statement of Stockholders' Equity.... 6
Unaudited Condensed Consolidated Statements of Cash Flows............. 7 - 8
Notes to Condensed Consolidated Financial Statements (Unaudited)...... 9 - 13
Item 2 - Management's Discussion and Analysis or Plan of Operation............. 14 - 18
PART II - OTHER INFORMATION
Item 1 - Legal Proceedings.................................................... 19
Item 6 - Exhibits and Reports on Form 8-K...................................... 19
SIGNATURES.............................................................................. 20
2
REPORT OF INDEPENDENT ACCOUNTANTS
Members of the Audit Committee
Access Anytime Bancorp, Inc.
We have reviewed the accompanying condensed consolidated statement of
financial condition of Access Anytime Bancorp, Inc. and subsidiary as of
September 30, 2000 and the related condensed consolidated statements of
operations for the three and nine month periods ended September 30, 2000 and
1999 and the related condensed consolidated statement of stockholders' equity
for the nine month period ended September 30, 2000 and the condensed
consolidated statements of cash flows for the nine month periods ended
September 30, 2000 and 1999. These condensed consolidated financial
statements are the responsibility of the Company's management.
We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, the
objective of which is the expression of an opinion regarding the consolidated
financial statements taken as a whole. Accordingly, we do not express such an
opinion.
Based upon our reviews, we are not aware of any material modifications that
should be made to the condensed consolidated financial statements referred to
above for them to be in conformity with generally accepted accounting
principles.
We previously audited, in accordance with generally accepted auditing
standards, the consolidated statement of financial condition as of December
31, 1999, and the related consolidated statements of operations and cash
flows for the year then ended (not presented herein); and in our report dated
March 2, 2000 (except as to Note 19 for which the date is March 6, 2000), we
expressed an unqualified opinion on those consolidated financial statements.
In our opinion, the information set forth in the accompanying condensed
consolidated statement of financial condition as of December 31, 1999, is
fairly stated, in all material respects, in relation to the consolidated
statement of financial condition from which it has been derived
ROBINSON BURDETTE MARTIN SERIGHT & BURROWS, L.L.P.
Lubbock, Texas
October 21, 2000
3
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
The following unaudited consolidated financial statements include all
adjustments, which in the opinion of management, are necessary in order to
make such financial statements not misleading.
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
September 30, December 31,
ASSETS 2000 1999
- ------ -------------------- --------------------
Cash and cash equivalents $ 9,244,024 $ 7,874,748
Certificates of deposit 3,843,000 5,092,000
Securities available-for-sale (amortized cost of $8,102,220 and $9,231,129) 7,967,701 9,119,966
Securities held-to-maturity (aggregate fair value of $6,936,108
and $6,779,494) 6,968,416 6,856,891
Loans held-for-sale (aggregate fair value of $1,316,449 and $187,175) 1,285,105 183,850
Loans receivable, net 114,383,494 104,176,810
Interest receivable 990,638 869,234
Real estate owned 561,585 187,778
Federal Home Loan Bank stock 929,400 879,758
Premises and equipment, net 3,631,659 2,472,703
Servicing rights 66,104 83,737
Goodwill, net 2,051,380 2,134,860
Deferred tax asset 1,162,925 1,334,100
Other assets 410,374 541,282
-------------------- --------------------
Total assets $ 153,495,805 $ 141,807,717
==================== ====================
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
Liabilities:
Deposits $ 136,001,408 $ 122,479,738
Federal Home Loan Bank advances 3,250,000 7,250,000
Accrued interest and other liabilities 1,031,734 664,686
Advanced payments by borrowers for taxes and insurance 238,505 99,861
Employee Stock Ownership Plan - Note Payable 1,320,083 --
-------------------- --------------------
Total liabilities 141,841,730 130,494,285
-------------------- --------------------
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value; 4,000,000 shares authorized; none -- --
issued
Common stock, $.01 par value; 6,000,000 shares authorized;
1,489,116 and
1,244,016 shares issued; 1,242,747 and 1,238,374 outstanding in 14,891 12,440
2000 and 1999, respectively
Capital in excess of par value 11,039,792 9,659,555
Retained earnings 2,110,279 1,754,815
Accumulated other comprehensive loss, net of tax of $45,736 and (88,782) (73,368)
$37,795
-------------------- --------------------
13,076,180 11,353,442
Unallocated Employee Stock Ownership Plan shares (1,320,083) --
Treasury stock, at cost (102,022) (40,010)
-------------------- --------------------
Total stockholders' equity 11,654,075 11,313,432
-------------------- --------------------
Total liabilities and stockholders' equity $ 153,495,805 $ 141,807,717
==================== ====================
The accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.
See accountants' review report.
4
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Month Periods Ended Nine Month Periods Ended
September 30, September 30,
------------------------------------ ---------------------------------
2000 1999 2000 1999
------------------ ---------------- ----------------- ---------------
Interest income:
Loans receivable $ 2,346,715 $ 1,902,266 $ 6,712,219 $ 5,568,421
U.S. government agency securities 57,775 11,821 184,690 34,570
Mortgage-backed securities 206,967 210,912 652,431 696,412
Other interest income 104,174 71,603 304,507 214,194
------------------ ---------------- ----------------- ---------------
Total interest income 2,715,631 2,196,602 7,853,847 6,513,597
------------------ ---------------- ----------------- ---------------
Interest expense:
Deposits 1,361,378 1,041,341 3,645,241 3,242,137
FHLB advances 116,677 118,085 437,257 330,279
------------------ ---------------- ----------------- ---------------
Total interest expense 1,478,055 1,159,426 4,082,498 3,572,416
------------------ ---------------- ----------------- ---------------
Net interest income before provision for loan losses 1,237,576 1,037,176 3,771,349 2,941,181
Provision for loan losses 39,000 138,301 116,378 312,672
------------------ ---------------- ----------------- ---------------
Net interest income after provision for loan losses 1,198,576 898,875 3,654,971 2,628,509
------------------ ---------------- ----------------- ---------------
Noninterest income:
Loan servicing and other fees 58,806 76,244 172,157 174,819
Net realized gains on sales of available-for-sale
securities -- -- -- 739,475
Net realized gains on sales of loans 105,661 85,474 194,280 235,122
Other income 184,548 124,534 549,084 336,611
------------------ ---------------- ----------------- ---------------
Total other income 349,015 286,252 915,521 1,486,027
------------------ ---------------- ----------------- ---------------
Noninterest expenses:
Salaries and employee benefits 720,362 459,058 2,005,912 1,518,128
Occupancy expense 212,201 146,256 610,044 439,446
Deposit insurance premium 27,412 34,538 77,938 101,743
Advertising 37,191 7,847 67,432 29,323
Real estate operations, net 4,301 5,770 16,726 5,324
Professional fees 73,154 43,219 191,306 154,362
Amortization of goodwill 36,270 -- 108,652 --
Other expense 303,442 281,700 952,902 898,389
------------------ ---------------- ----------------- ---------------
Total other expenses 1,414,333 978,388 4,030,912 3,146,715
------------------ ---------------- ----------------- ---------------
Income before income taxes 133,258 206,739 539,580 967,821
Income tax expense (benefit) 45,307 (88,460) 184,116 (147,193)
------------------ ---------------- ----------------- ---------------
Net income $ 87,951 $ 295,199 $ 355,464 $ 1,115,014
================== ================ ================= ===============
Earnings per common share $ .07 $ .24 $ .29 $ .90
================== ================ ================= ===============
Earnings per common share-assuming dilution $ .07 $ .23 $ .28 $ .88
================== ================ ================= ===============
The accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.
See accountants' review report.
5
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
Common Stock Treasury Stock
----------------- --------------------
Capital
in Excess
Comprehensive Number Number Unearned of Par Retained
Income of shares Amount of Shares Amount ESOP Shares Value Earnings
------------- --------- -------- --------- ---------- ----------- ----------- ----------
Balance at December 31, 1999 1,244,016 $ 12,440 5,642 $ (40,010) $ -- $9,659,555 $1,754,815
Net income $ 355,464 -- -- -- -- -- -- 355,464
Net changes in unrealized
depreciation on available-for-
sale securities, net of tax (15,414) -- -- -- -- -- -- --
-------------
Total comprehensive income $ 340,050
=============
Common stock issued 245,100 2,451 -- -- -- 1,365,287 --
Common stock rights issued
in lieu of directors' cash -- -- -- -- -- 14,950 --
compensation
Purchase of ESOP shares -- -- -- -- (1,350,000) -- --
Purchases of treasury stock -- -- 8,727 (62,012) -- -- --
ESOP shares allocated -- -- -- -- 29,917
--------- -------- --------- ---------- ----------- ----------- ----------
Balance at September 30, 2000 1,489,116 $ 14,891 14,369 $(102,022) $(1,320,083) $11,039,792 $2,110,279
========= ======== ========= ========== =========== =========== ==========
Accumulated
Other
Comprehensive
Income
(Loss)
Net Total
----------- -----------
Balance at December 31, 1999 $ (73,368) $11,313,432
Net income -- 355,464
Net changes in unrealized
depreciation on available-for-
sale securities, net of tax (15,414) (15,414)
Total comprehensive income
Common stock issued -- 1,367,738
Common stock rights issued
in lieu of directors' cash
compensation -- 14,950
Purchase of ESOP shares -- (1,350,000)
Purchases of treasury stock -- (62,012)
ESOP shares allocated 29,917
----------- -----------
Balance at September 30, 2000 $ (88,782) $11,654,075
=========== ===========
The accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.
See accountants' review report.
6
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine Month Periods Ended
September 30,
--------------------------------------
2000 1999
------------------ ------------------
Cash flows from operating activities:
Net income $ 355,464 $ 1,115,014
Adjustments to reconcile net income to cash
provided by operating activities:
Depreciation 325,217 243,169
Deferred income taxes 179,116 (127,240)
Provision for loan losses charged 116,378 312,672
Amortization of premiums on investment securities 58,224 90,050
Amortization of loan premiums, discounts and
deferred fees, net 120,952 67,871
Amortization of organizational costs -- 115,162
Amortization of goodwill 108,652 --
Gain on sale of loans held-for-sale (194,280) (235,122)
Proceeds from sales of loans held-for-sale 9,186,605 16,358,316
Originations of loans held-for-sale (10,098,777) (16,441,460)
Common stock rights issued in lieu of directors
compensation 14,950 15,000
Gain on foreclosed real estate -- (3,713)
(Gain) loss on disposition of assets 4,791 (5,944)
Gain on sale of available-for-sale securities -- (739,475)
Non-cash ESOP contribution 29,917 --
Net increase in accrued interest receivable and
other assets 116,250 (584,172)
Increase (decrease) in accrued expense and other
liabilities 367,048 (169,661)
------------------ ------------------
Net cash provided by operating activities 690,507 10,467
------------------ ------------------
Cash flows from investing activities:
Proceeds from maturities and principal repayments
of available-for-sale securities 1,092,477 1,817,844
Purchases of held-to-maturity securities (2,191,887) --
Proceeds from maturities and principal repayments
of held-to-maturity securities 2,058,571 2,367,441
Proceeds from sale of available-for-sale securities -- 746,409
Purchase of available-for-sale securities -- (6,858)
Purchase of FHLB stock (49,642) (77,200)
Net (increase) decrease in certificates of deposit 1,249,000 (802,981)
Net increase in loans (10,926,909) (10,124,194)
Proceeds from sales of foreclosed real estate -- 69,169
Purchases of premises and equipment (1,488,964) (229,289)
------------------ ------------------
Net cash used in investing activities (10,257,354) (6,239,659)
------------------ ------------------
Cash flows from financing activities:
Net increase (decrease) in deposits 13,521,670 (2,141,809)
Net change in other borrowed funds (4,000,000) 7,300,000
Net increase (decrease) in advance payments by
borrowers for taxes and insurance 138,644 (177,429)
Purchase of treasury stock (62,012) (23,032)
Proceeds from issuance of common stock 1,367,738 37,124
Repayment of debt (29,917) --
------------------ ------------------
Net cash provided by financing activities 10,936,123 4,994,854
------------------ ------------------
Increase (decrease) in cash and cash equivalents 1,369,276 (1,234,338)
Cash and cash equivalents at January 1 7,874,748 5,232,708
------------------ ------------------
Cash and cash equivalents at September 30 $ 9,244,024 $ 3,998,370
================== ==================
(Continued)
7
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(CONTINUED)
Nine Month Periods Ended
September 30,
--------------------------------------
2000 1999
------------------ ------------------
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 4,037,063 $ 3,271,517
Income taxes 5,000 20,000
Supplemental disclosure of non-cash investing and
financing activities
Real estate acquired in settlement of loans
482,985 409,568
The accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.
See accountants' review report.
8
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1 BASIS OF CONSOLIDATION AND PRESENTATION
Access Anytime Bancorp, Inc. (the "Company") is a thrift holding company for
its wholly-owned subsidiary FirstBank (the "Bank") and the Bank's
wholly-owned subsidiary, First Equity Development Corporation ("FEDCO"). The
consolidated financial statements include the accounts and transactions of
the Company, the Bank and FEDCO. All significant intercompany accounts and
transactions have been eliminated in consolidation.
The unaudited interim financial statements have been prepared by management
of the Company, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been omitted pursuant to
such rules and regulations, although management believes that the disclosures
included herein are adequate to make the information presented not
misleading. In the opinion of management, all adjustments (consisting of only
normal recurring accruals) considered necessary for presentation of the
information have been included. The December 31, 1999 consolidated statement
of financial condition, as presented herein, was derived from audited
financial statements, but does not include all disclosures required by
generally accepted accounting principles and should be read in conjunction
with the audited consolidated financial statements of the Company for the
year ended December 31, 1999.
9
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 2 SECURITIES
Securities have been classified in the consolidated statements of financial
condition according to management's intent. The carrying amount of securities
and their approximate fair value follows:
Amortized Gross unrealized Fair
Cost Gains Losses Value
----------------- ------------------ ----------------- -----------------
AVAILABLE-FOR-SALE SECURITIES:
September 30, 2000:
Mortgage-backed securities:
GNMA adjustable rate $ 8,095,362 $ 152 $ 134,588 $ 7,960,926
Equity securities:
FNMA common stock 6,858 -- 83 6,775
----------------- ------------------ ----------------- -----------------
$ 8,102,220 $ 152 $ 134,671 $ 7,967,701
================= ================== ================= =================
December 31, 1999:
Mortgage-backed securities:
GNMA adjustable rate $ 9,231,129 $ 4,565 $ 115,728 $ 9,119,966
================= ================== ================= =================
Amortized Gross unrealized Fair
Cost Gains Losses Value
----------------- ------------------ ----------------- -----------------
HELD-TO-MATURITY SECURITIES:
September 30, 2000:
Mortgage-backed securities:
FNMA participation certificates $ 299,758 $ -- $ 2,616 $ 297,142
FHLMC participation certificates 1,566,663 -- 14,662 1,552,001
GNMA fixed rate 1,750,754 17,395 -- 1,768,149
FHLMC adjustable rate 859,293 -- 24,914 834,379
US government agency bonds 1,000,000 -- 3,663 996,337
Corporate bonds 1,191,948 493 4,341 1,188,100
Trust preferred securities 300,000 -- -- 300,000
----------------- ------------------ ----------------- -----------------
$ 6,968,416 $ 17,888 $ 50,196 $ 6,936,108
================= ================== ================= =================
December 31, 1999:
Mortgage-backed securities:
FNMA participation certificates $ 1,515,252 $ -- $ 15,801 $ 1,499,451
FHLMC participation certificates 2,175,614 -- 21,716 2,153,898
FHLMC adjustable rate 969,828 -- 37,607 932,221
US government agency bonds 1,000,000 -- 4,146 995,854
Corporate bonds 896,197 -- 7,877 888,320
Trust preferred securities 300,000 13,500 3,750 309,750
----------------- ------------------ ----------------- -----------------
$ 6,856,891 $ 13,500 $ 90,897 $ 6,779,494
================= ================== ================= =================
10
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 3 LOANS HELD-FOR-SALE
The carrying amount of loans held-for-sale and their estimated fair value, as
determined on an aggregate basis, follows:
Gross unrealized
--------------------------------------------
Amortized cost Gains Losses Fair value
------------------- ------------------- ------------------- -------------------
September 30, 2000 $ 1,285,105 $ 31,344 $ -- $ 1,316,449
December 31, 1999 183,850 3,325 -- 187,175
NOTE 4 LOANS RECEIVABLE
The components of loans in the consolidated statements of financial condition
were as follows:
September 30, December 31,
2000 1999
----------------- -------------------
First mortgage loans:
Conventional $ 84,233,851 $ 78,163,131
FHA insured and VA guaranteed 6,903,878 6,350,481
Consumer and installment loans 19,840,287 17,472,395
Construction loans 511,500 569,176
Other 4,552,938 3,664,735
----------------- -------------------
116,042,454 106,219,918
Less:
Loans in process 152,681 413,520
Unearned discounts, deferred loan fees, and other 885,157 765,271
Allowance for loan losses 621,122 864,317
----------------- -------------------
$ 114,383,494 $ 104,176,810
================= ===================
An analysis of the changes in allowance for loan losses follows:
Nine Months Ended Year Ended
September 30, 2000 December 31, 1999
---------------------- --------------------
Balance at beginning of year $ 864,317 $ 600,984
Loans charged-off (124,289) (341,775)
Recoveries 14,715 31,288
---------------------- --------------------
Net loans charged-off (109,574) (310,487)
Provision for loan losses charged to operations 116,379 323,820
Acquired general valuation allowance (250,000) 250,000
---------------------- --------------------
Balance at end of period $ 621,122 $ 864,317
====================== ====================
11
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 4 LOANS RECEIVABLE (CONTINUED)
An analysis of the changes of loans to directors, executive officers, and major
stockholders is as follows:
Nine Months Ended Year Ended
September 30, 2000 December 31, 1999
---------------------- --------------------
Balance at beginning of year $ 1,300,285 $ 2,272,616
Loans originated 65,110 217,074
Loan principal payments and other reductions (100,551) (1,189,405)
---------------------- --------------------
Balance at end of period $ 1,264,844 $ 1,300,285
====================== ====================
NOTE 5 NON-PERFORMING ASSETS
The composition of the Bank's portfolio of non-performing assets is shown in the
following table:
September 30, 2000 December 31, 1999
----------------------- ---------------------
Non-accruing loans* $ 132,665 $ 124,431
Past due 90 days or more and still accruing -- --
Real estate owned 561,585 187,778
----------------------- ---------------------
Total non-performing assets $ 694,250 $ 312,209
======================= =====================
Ratio of non-performing assets to total assets 0.45% 0.22%
======================= =====================
* Primarily loans which are past due for 90 days or more
12
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 6 NET INCOME PER SHARE
Basic net income per share has been computed by dividing net income available to
common stockholders for the period by the weighted average number of common
shares outstanding during the period. Diluted net income per share has been
computed by dividing net income available to common stockholders for the period
by the weighted average number of common shares outstanding during the period
adjusted for the assumed exercise of outstanding stock options and other
contingently issuable shares of common stock. Net income for basic and diluted
earnings per share are the same, as there are no contingently issuable shares of
stock whose issuance would have impacted net income.
A reconciliation between basic and diluted weighted average common shares
outstanding follows:
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------------------- ------------------------------------
2000 1999 2000 1999
------------------------------------- ------------------------------------
Weighted average common
shares - Basic* 1,248,047 1,239,262 1,244,032 1,238,908
Plus effect of dilutive securities:
Stock Options 6,470 26,914 9,338 21,952
Shares held by Rabbi Trust 13,789 4,222 11,624 2,864
----------------- ------------------ ----------------- -----------------
Weighted average common
shares - Assuming Dilution 1,268,306 1,270,398 1,264,994 1,263,724
================= ================== ================= =================
*Includes shares awarded to directors under the Non-Employee Director
Retainer Plan
13
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
THE FOREGOING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH ACCESS ANYTIME
BANCORP, INC.'S ("THE COMPANY") 1999 ANNUAL REPORT ON FORM 10-KSB.
GENERAL
The Company is a Delaware corporation which was organized in 1996 for the
purpose of becoming the thrift holding company of FirstBank (the "Bank"). The
Bank is a federally chartered stock savings bank conducting business from
five banking locations in Albuquerque, Clovis, Gallup, and Portales, New
Mexico. The Bank has a wholly-owned subsidiary which is currently inactive.
The Bank is principally engaged in the business of attracting retail and
commercial deposits from the general public and investing those funds in
first mortgage loans in owner occupied, single-family residential loans,
residential construction loans and commercial real estate loans. In addition,
the Bank also originates consumer loans, including loans for the purchase of
automobiles and home improvement loans, and commercial business loans
including Small Business Administration loans.
The most significant outside factors influencing the operations of the Bank
and other financial institutions include general economic conditions,
competition in the local market place and the related monetary and fiscal
policies of agencies that regulate financial institutions. More specifically,
the cost of funds, primarily consisting of deposits, is influenced by
interest rates on competing investments and general market rates of interest.
Lending activities are influenced by the demand for real estate financing and
other types of loans, which in turn is affected by the interest rates at
which such loans may be offered and other factors affecting loan demand and
funds availability.
FINANCIAL CONDITION
Total assets for the Company increased by $11,688,088 or 8.24%, from December
31, 1999 to September 30, 2000. The increase in assets was primarily due to
an increase of approximately $10.2 million in loans receivable from December
31, 1999 to September 30, 2000.
Total liabilities increased by $11,347,445 or 8.70%, for the nine-month
period ended September 30, 2000. An increase of $13.5 million or 11.04% in
deposits was the cause of the increase in total liabilities. The opening of a
branch in Albuquerque, New Mexico in June 2000 was the primary cause of the
increase in deposits. The increase in deposits was used to fund the increase
in loans receivable and decrease FHLB advances by $4 million.
To support the institution's growth in Gallup and Albuquerque, the Company
issued 240,000 new common shares of stock to an Employee Stock Ownership Plan
(ESOP), which was facilitated by a loan in the amount of $1,350,000 that was
obtained from a third party lender. This transaction was consummated on May
1, 2000. The 240,000 shares are held in suspense until loan payments are
made, at which time shares are allocated to ESOP participants. The first of
these payments was made on August 1, 2000.
14
CAPITAL ADEQUACY AND LIQUIDITY
CAPITAL ADEQUACY - Under the Financial Institutions Reform, Recovery and
Enforcement Act of 1989 ("FIRREA") and the implementation of Office of Thrift
Supervision ("OTS") regulations on December 7, 1989 the Bank must have: (1)
Tier 1 or core capital equal to 3% of adjusted total assets and (2) total
capital equal to 8.0% of risk-weighted assets, which includes off-balance
sheet items.
Under the Federal Deposit Insurance Corporation Improvement Act ("FDICIA"),
to be deemed "well capitalized" the minimum ratios the Bank must have are:
(1) Tier 1 or core capital of 5% of adjusted total assets, (2) Tier 1
risk-based capital of 6% of risk-weighed assets, and (3) total risk-based
capital of 10% of risk weighted assets.
The following table is a reconciliation of the Bank's capital for
regulatory purposes at September 30, 2000 as reported to the OTS.
Tier 1- Tier 1- Total
Core Risk-based Risk-based
Capital Capital Capital
------------------ ----------------- -----------------
Total regulatory assets $ 153,479,593
Net unrealized depreciation on
available-for-sale securities, net 88,782
Less intangible assets disallowed for
regulatory purposes (2,373,305)
------------------
Adjusted regulatory total assets $ 151,195,070
==================
Risk-based assets $ 99,792,000 $ 99,792,000
================= =================
Stockholders' equity $ 13,172,637 $ 13,172,637 $ 13,172,637
Net unrealized depreciation on
available-for-sale securities, net 88,782 88,782 88,782
General valuation allowance -- -- 621,122
Less intangible assets disallowed for
regulatory purposes (2,373,305) (2,373,305) (2,373,305)
------------------ ----------------- -----------------
Regulatory capital 10,888,114 10,888,114 11,509,236
Regulatory capital required to be "well capitalized" 7,559,754 5,987,520 9,979,200
------------------ ----------------- -----------------
Excess regulatory capital $ 3,328,360 $ 4,900,594 $ 1,530,036
================== ================= =================
Bank's capital to adjusted regulatory assets 7.20%
==================
Bank's capital to risk-based assets 10.91% 11.53%
================= =================
LIQUIDITY
Liquidity enables the Bank to meet withdrawals of its deposits and the needs
of its loan customers. The Bank maintains its liquidity position through
maintenance of cash resources and a core deposit base. A further source is
the Bank's ability to borrow funds. The Bank is a member of the Federal Home
Loan Bank ("FHLB") which provides a source of borrowings to the Bank for
asset and asset/liability matching. FHLB borrowings were reduced from $14.25
million to $3.25 million from June 30, 2000 to September 30, 2000 primarily
due to a $13.5 million increase in deposits.
15
RESULTS OF OPERATIONS
THREE-MONTH COMPARATIVE ANALYSIS FOR PERIODS SEPTEMBER 30, 2000 AND 1999
Net income for the three-months ended September 30, 2000 was $87,951 or $.07
per share compared to $295,199 or $.24 per share for the three-months ended
September 30, 1999.
Net Interest Income. Net interest income before provision for loan losses
increased by approximately $201,000 to $1,238,000 for the three-month period
ended September 30, 2000 compared to $1,037,000 for the same period in 1999.
Interest income for the quarter ended September 30, 2000 increased by
$519,000 that was reduced by an increase in interest expense of $318,000, as
compared to the quarter ended September 30, 1999. The increase in interest
income was primarily due to an increase in loan receivable interest income of
$444,000.
Provision for Loan Losses. The level of the allowance for loan losses is
based on such factors as the amount of non-performing assets, historical loss
experience, regulatory policies, general economic conditions, the estimated
fair value of the underlying collateral and other factors which may affect
the collectibility of loans. During the third quarter of 2000, the provision
for loan losses decreased by $99,000 to $39,000 compared to $138,000 in the
third quarter of 1999.
Noninterest Income. During the three-months ended September 30, 2000,
noninterest income increased by $63,000 to $349,000 compared to $286,000 in
1999. The increase in noninterest income for the quarter ended September 30,
2000 was primarily due to an increase in other income of $60,000 to $185,000,
as compared to $125,000 for the quarter ended September 30, 1999. The
increase in other income was primarily due to an increase in fees on deposit
accounts, because of the purchase of branch facilities in Clovis and Gallup,
New Mexico in November 1999 and the opening of a branch in Albuquerque, New
Mexico in June 2000.
Noninterest Expense. Noninterest expense increased to $1,414,000 from
$978,000 for the quarter ended September 30, 2000 compared to the same
quarter in 1999. The $436,000 increase in noninterest expense was primarily
due to an increase in salaries and employee benefits of $261,000. Other
contributing factors to the increase in noninterest expense were increases in
occupancy expense, amortization of goodwill, professional fees, and
advertising of approximately $66,000, $36,000, $30,000, and $29,000,
respectively. These increases in noninterest expense were primarily due to
the purchase of branch facilities in Clovis and Gallup, New Mexico in
November 1999 and the opening of a branch in Albuquerque, New Mexico in June
2000.
Provision for Income Taxes. The income tax expense for the quarter ended
September 30, 2000 was an expense of $45,000 compared to a benefit of $88,000
in the quarter ended September 30, 1999. The net income tax benefit in 1999
was a result of a reduction in the valuation allowance relative to the
deferred tax asset generated by net operating loss carryforwards during the
quarter.
16
NINE-MONTH COMPARATIVE ANALYSIS FOR PERIODS ENDED SEPTEMBER 30, 2000 AND 1999
Net income for the nine-months ended September 30, 2000 was $355,464 or $.29
per share compared to $1,115,014 or $.90 for the nine-months ended September
30, 1999.
Net Interest Income. Net interest income before provision for loan losses
increased by approximately $830,000 to $3,771,000 for the nine-month period
ended September 30, 2000 compared to $2,941,000 for the same period in 1999.
The increase in net interest income before provision for loan losses was
primarily caused by an increase in loan receivable interest income, which
generated an additional $1,144,000 for the nine-months ended September 30,
2000 as compared to the same period from the prior year. The increase in net
interest income was reduced by an increase of $403,000 in deposits interest
expense.
Provision for Loan Losses. During the first nine-months of 2000, the
provision for loan losses decreased to $116,000 compared to $313,000 in the
first nine-months of 1999.
Noninterest Income. During the nine-months ended September 30, 2000,
noninterest income decreased by $570,000 to $916,000 compared to $1,486,000
in 1999. The decrease in noninterest income was primarily due to a long-term
capital gain on the sale of securities of $739,475 during the first quarter
of 1999.
Noninterest Expense. Noninterest expense increased to $4,031,000 from
$3,147,000 for the nine-months ended September 30, 2000 compared to the same
period in 1999. The $884,000 increase in noninterest expense was primarily
due to increases in salaries and employee benefits of $488,000, occupancy
expense of $171,000, and amortization of goodwill of $109,000. These
increases in noninterest expense were primarily due to the purchase of branch
facilities in Clovis and Gallup, New Mexico in November 1999 and the opening
of a branch in Albuquerque, New Mexico in June 2000.
Provision for Income Taxes. The income tax expense for the first nine-months
of 2000 was an expense of $184,000 compared to a benefit of $147,000 in the
nine-months ended September 30, 1999. The net income tax benefit in 1999 was
a result of a reduction in the valuation allowance relative to the deferred
tax asset generated by net operating loss carryforwards during the
nine-months ended September 30, 1999.
FORWARD-LOOKING STATEMENTS
When used in this Form 10-QSB, certain words or phrases are intended to
identify "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such statements are subject to
certain risks and uncertainties - including, changes in economic conditions
in the Company's market area, changes in policies by regulatory agencies,
fluctuations in interest rates, demand for loans in the Company's market area
and competition, that could cause actual results to differ materially from
historical earnings and those presently anticipated or projected. The Company
wishes to caution readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date made. The Company
wishes to advise readers that the factors listed above could affect the
Company's financial performance and could cause the Company's actual results
for
17
future periods to differ materially from any opinions or statements expressed
with respect to future periods in any current statements.
The Company does not undertake - and specifically disclaims any obligation -
to publicly release the results of any revisions which may be made to any
forward-looking statements to reflect events or circumstances after the date
of such statements or to reflect the occurrence of anticipated or
unanticipated events.
18
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
None
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
27 Financial Data Schedule
(b) Reports on Form 8-K.
None
19
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
ACCESS ANYTIME BANCORP, INC.
Date: October 25, 2000 /s/ Norman R. Corzine
------------------------------------------
Norman R. Corzine, Chairman of the Board,
Chief Executive Officer
(DULY AUTHORIZED REPRESENTATIVE)
Date: October 25, 2000 /s/ Ken Huey, Jr.
-----------------------------------------
Ken Huey, Jr., President, Chief Financial
Officer and Director
(PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER)
(DULY AUTHORIZED REPRESENTATIVE)
20