UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1997
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: 0-28894
ACCESS ANYTIME BANCORP, INC.
- -------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
DELAWARE 85-0444597
- --------------------------------- -----------------------------
(State or other jurisdiction of (I.R.S. Employer
of incorporation or organization) Identification No.)
801 PILE STREET, CLOVIS, NEW MEXICO 88101
--------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (505) 762-4417
-----------------------
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
----- -----
1,193,076 Shares of Capital Stock $.01 par value
Outstanding as of July 24, 1997
Transitional Small Business Disclosure Format (check one):
Yes No X
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TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
Unaudited Consolidated Statements of
Financial Condition. . . . . . . . . . . . . . . . . . . . . . 3
Unaudited Consolidated Statements of Operations. . . . . . . . 4
Unaudited Consolidated Statements of Changes in
Stockholders' Equity . . . . . . . . . . . . . . . . . . . . . 5
Unaudited Consolidated Statements of Cash Flows . . . . . . . 6
Notes to Consolidated Financial Statements (Unaudited) . .7 - 12
Item 2 - Managements' Discussion and Analysis or
Plan of Operation. . . . . . . . . . . . . . . . . . 13 - 17
PART II - OTHER INFORMATION
Item 2 - Legal Proceedings. . . . . . . . . . . . . . . . . . . . .18
Item 4 - Submission of Matters to a Vote of Security Holders. . . .19
Item 6 - Exhibits and Reports on Form 8-K . . . . . . . . . . . . .20
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21
2
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
The following 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 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
June 30, December 31,
1997 1996
------------ -------------
ASSETS
- ------
Cash and cash equivalents $ 3,115,040 $ 2,199,227
Certificates of deposit 1,580,142 380,570
Securities available-for-sale
(amortized cost of $16,688,242 and $23,838,281) 16,694,801 23,639,686
Securities held-to-maturity
(aggregate fair value of $24,844,524 and $28,470,335) 25,150,370 29,113,430
Loans held-for-sale
(aggregate fair value of $529,994 and $576,994) 517,926 564,361
Loans receivable 52,468,696 45,596,212
Interest receivable 598,682 598,327
Real estate owned 49,200 86,114
FHLB stock 1,618,333 1,572,334
Premises and equipment 1,866,483 1,924,405
Servicing rights 344,500 345,554
Organizational cost, net of accumulated amortization of
$27,365 and $9,814 163,782 163,373
Other assets 484,839 669,764
------------ ------------
Total assets $104,652,794 $106,853,357
------------ ------------
------------ ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
Liabilities:
Deposits $ 95,772,084 $ 98,164,001
Federal Home Loan Bank advances 300,000 3,000,000
Accrued interest and other liabilities 351,392 351,135
Advance payments by borrowers for taxes and insurance 433,335 252,099
------------ ------------
Total liabilities 96,856,811 101,767,235
------------ ------------
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value; 4,000,000
shares authorized; none issued
Common stock, $.01 par value, authorized - 6,000,000
shares authorized; 1,193,076 and 732,198 shares
issued and outstanding at June 30, 1997 and
December 31, 1996, respectively 11,931 7,322
Capital in excess of par value 9,273,159 7,019,577
Accumulated deficit (1,495,666) (1,742,182)
Net unrealized appreciation (depreciation) on
available-for-sale securities, net 6,559 (198,595)
------------ ------------
Total stockholders' equity 7,795,983 5,086,122
------------ ------------
Total liabilities and stockholders' equity $104,652,794 $106,853,357
------------ ------------
------------ ------------
See accompanying notes to unaudited consolidated financial statements.
3
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTH PERIODS ENDED SIX MONTH PERIODS ENDED
JUNE 30, JUNE 30
1997 1996 1997 1996
---------- ---------- ---------- ----------
Interest income:
Loans receivable $1,105,420 $ 823,829 $2,117,789 $1,608,531
U.S. government agency securities 25,290 110,050 49,100 194,067
Mortgage-backed securities 625,626 898,876 1,303,368 1,826,362
Other interest income 65,032 55,603 130,332 160,330
---------- ---------- ---------- ----------
Total interest income 1,821,368 1,888,358 3,600,589 3,789,290
---------- ---------- ---------- ----------
Interest expense:
Deposits 1,038,164 1,190,905 2,074,105 2,468,428
FHLB advances 1,485 -- 12,814 --
---------- ---------- ---------- ----------
Total interest expense 1,039,649 1,190,905 2,086,919 2,468,428
---------- ---------- ---------- ----------
Net interest income before provision for loan losses 781,719 697,453 1,513,670 1,320,862
Provision for loan losses charged (credited) 44,655 26,037 67,439 (35,742)
---------- ---------- ---------- ----------
Net interest income after provision for
loan losses 737,064 671,416 1,446,231 1,356,604
---------- ---------- ---------- ----------
Noninterest income:
Loan servicing and other fees 87,766 84,098 171,656 171,647
Net realized gains on sales of available-for-sale
securities 3,000 -- 20,637 --
Net realized gains on sales of loans 24,261 27,762 61,716 64,009
Real estate operations, net 271 -- 360 --
Other income 88,595 78,226 184,634 153,234
---------- ---------- ---------- ----------
Total other income 203,893 190,086 439,003 388,890
---------- ---------- ---------- ----------
Noninterest expenses:
Salaries and employee benefits 436,453 397,898 841,034 787,752
Occupancy expense 95,320 83,952 199,058 169,236
Deposit insurance premium 70,015 96,380 129,209 195,108
Advertising 14,132 5,503 24,821 9,372
Real estate operations, net -- 1,557 -- 37,656
Professional fees (59,331) 54,183 (32,014) 85,942
Other expense 248,559 197,579 476,610 412,523
---------- ---------- ---------- ----------
Total other expenses 805,148 837,052 1,638,718 1,697,589
---------- ---------- ---------- ----------
Net income $ 135,809 $ 24,450 $ 246,516 $ 47,905
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net income per share of common stock $ .11 $ .04 $ .24 $ .07
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Average shares outstanding 1,189,502 695,698 1,043,546 695,698
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
See accompanying notes to unaudited consolidated financial statements.
4
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Net
Unrealized
Appreciation
(Depreciation)
Common Stock On
------------ Available-
Capital In For-Sale
Number of Excess of Accumulated Securities,
Shares Amount Par Value Deficit Net Total
---------- -------- ---------- ------------ -------------- ----------
Balance at December 31, 1996 732,198 $ 7,322 $7,019,577 $(1,742,182) $ (198,595) $5,086,122
Net income -- -- -- 246,516 -- 246,516
Common stock issued 460,878 4,609 2,253,582 -- -- 2,258,191
Net changes in unrealized
appreciation (depreciation)
on available-for-sale
securities, net -- -- -- -- 205,154 205,154
--------- -------- ---------- ----------- ------------ ----------
Balance at June 30, 1997 1,193,076 $ 11,931 $9,273,159 $(1,495,666) $ 6,559 $7,795,983
--------- -------- ---------- ----------- ------------ ----------
--------- -------- ---------- ----------- ------------ ----------
See accompanying notes to unaudited consolidated financial statements.
5
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
Six Month Periods Ended
June 30,
--------------------------
1997 1996
----------- -----------
Cash flows from operating activities:
Net Income $ 246,516 $ 47,905
Adjustments to reconcile net income to
cash provided by (used) by operating activities:
Depreciation 69,940 66,042
Provision for loan losses charged (credited) 67,439 (35,742)
Amortization of premiums on investment securities 202,954 119,233
Amortization of organizational costs 17,551 --
Gain on sale of available-for-sale securities (20,637) --
Gain on sale of loans held-for-sale (61,716) (64,009)
Proceeds from sales of loans held-for-sale 3,872,356 4,288,005
Originations of loans held-for-sale (3,852,629) (5,897,241)
(Gain) loss on sale of REO (813) 1,469
Net (increase) decrease in accrued interest receivable and other assets 157,752 (165,868)
Increase (decrease) in accrued expense, other liabilities, and other 3,257 (112,933)
----------- -----------
Net cash provided by (used in) operating activities 701,970 (1,753,139)
----------- -----------
Cash flows from investing activities:
Proceeds from maturities and principal repayments of
available-for-sale securities 1,652,006 6,332,160
Purchases of held-to-maturity securities -- (5,000,000)
Proceeds from maturities and principal repayments
of held-to-maturity securities 3,902,492 3,015,934
Proceeds from sales of available-for-sale securities 5,376,284 --
Net increase in certificates of deposit (1,199,572) (489,572)
Net increase in loans (6,851,499) (1,358,350)
Proceeds from sales of foreclosed real estate 19,600 24,469
Purchases of premises and equipment (12,018) (30,305)
----------- -----------
Net cash provided by (used in) investing activities 2,887,293 2,494,336
----------- -----------
Cash flows from financing activities:
Net decrease in deposits (2,391,917) (4,371,935)
Net change in other borrowed funds (2,700,000) --
Net increase in advance payments by
borrowers for taxes and insurance 181,236 24,156
Organizational costs incurred (17,960) --
Rights offering costs incurred (164,419) --
Net proceeds from issuance of common stock 2,419,610 --
----------- -----------
Net cash used in financing activities (2,673,450) (4,347,779)
----------- -----------
Increase (decrease) in cash and cash equivalents 915,813 (3,606,582)
Cash and cash equivalents at beginning of period 2,199,227 6,752,606
----------- -----------
Cash and cash equivalents at end of period $ 3,115,040 $ 3,146,024
----------- -----------
----------- -----------
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 2,090,153 $ 2,533,108
Income taxes -- 100
Supplemental disclosure of non-cash investing activities:
Real estate acquired in settlement of loans -- --
Loans to facilitate the sale of real estate owned -- 21,000
See accompanying notes to unaudited consolidated financial statements.
6
ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
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NOTE A - BASIS OF CONSOLIDATION AND PRESENTATION AND USE OF ESTIMATES
Access Anytime Bancorp, Inc. (the "Company") is a thrift holding company for its
wholly-owned subsidiary FirstBank (the "Bank"), formerly known as First Savings
Bank, F.S.B., 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 Company was formed in 1996 and, through an agreement and plan of
reorganization by and between the Company and the Bank, became the holding
company for the Bank under a stock-for-stock exchange. As a result of this
reorganization, the prior year's financial statements are presented to reflect
the result of the reorganization. There was no effect on that year's net income
or net income per share of common stock.
The unaudited interim financial statements should be read in conjunction with
the audited consolidated financial statements of the Company for the year ended
December 31, 1996.
7
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NOTE B - SECURITIES - BANK
A summary of investment securities available-for-sale is as follows:
Amortized Gross unrealized Fair
Cost Gains Losses Value
--------- --------- ---------- -------------
AVAILABLE-FOR-SALE SECURITIES:
June 30, 1997:
Mortgage-backed securities:
GNMA adjustable-rate $ 16,688,242 $ 85,644 $ 79,085 $ 16,694,801
------------ -------- --------- ------------
$ 16,688,242 $ 85,644 $ 79,085 $ 16,694,801
------------ -------- --------- ------------
------------ -------- --------- ------------
December 31, 1996:
Mortgage-backed securities:
GNMA adjustable-rate $ 23,838,281 $ 18,365 $ 216,960 $ 23,639,686
------------ -------- --------- ------------
$ 23,838,281 $ 18,365 $ 216,960 $ 23,639,686
------------ -------- --------- ------------
------------ -------- --------- ------------
Amortized Gross unrealized Fair
Cost Gains Losses Value
--------- ------- ---------- ------------
HELD-TO-MATURITY SECURITIES:
June 30, 1997:
Mortgage-backed securities:
FNMA participation certificates $ 4,919,648 $ -- $ 112,635 $ 4,807,013
FHLMC participation certificates 18,480,055 4,892 155,338 18,329,609
FHLMC adjustable rates 1,750,667 -- 42,765 1,707,902
------------ ------- --------- ------------
$ 25,150,370 $ 4,892 $ 310,738 $ 24,844,524
------------ ------- --------- ------------
------------ ------- --------- ------------
December 31, 1996:
Mortgage-backed securities:
FNMA participation certificates $ 5,355,122 $ -- $ 162,192 $ 5,192,930
FHLMC participation certificates 21,896,565 4,818 453,206 21,448,177
FHLMC adjustable rates 1,861,743 -- 32,515 1,829,228
------------ ------- --------- ------------
$ 29,113,430 $ 4,818 $ 647,913 $ 28,470,335
------------ ------- --------- ------------
------------ ------- --------- ------------
8
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NOTE C - LOANS HELD-FOR-SALE - BANK
Loans held-for-sale are identified at the time the loan is originated, and
recorded at the lower of amortized cost or fair value with only net unrealized
losses included in the consolidated statements of operations.
Gross unrealized
---------------------
Amortized cost Gains Losses Fair Value
-------------- ------- ------ ----------
June 30, 1997 $517,926 $11,649 $ -- $529,575
December 31, 1996 564,361 12,633 -- 576,994
NOTE D - LOANS RECEIVABLE - BANK
The components of loans in the consolidated statements of financial condition
were as follows:
June 30, 1997 December 31, 1996
------------- -----------------
First mortgage loans:
Conventional $35,785,700 $31,513,687
FHA insured and VA guaranteed 4,322,182 4,326,093
Consumer and installment loans 11,086,291 9,047,776
Consumer timeshare loans 84,531 179,494
Construction loans 1,836,400 1,975,000
Other 672,223 387,600
----------- -----------
53,787,327 47,429,650
Less:
Loans in process 421,509 1,077,121
Unearned discounts, deferred loans fees,
and other 406,418 327,076
Allowance for loan losses 490,704 429,241
----------- -----------
$52,468,696 $45,596,212
----------- -----------
----------- -----------
9
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NOTE D - LOANS RECEIVABLE (CONTINUED)
An analysis of the changes in allowance for loan losses follows:
Six Months Ended Year Ended
June 30, 1997 December 31, 1996
---------------- -----------------
Balance at beginning of year $429,241 $427,889
Loans charged-off (15,714) (17,882)
Recoveries 9,738 5,595
-------- --------
Net loans charged-off (5,976) (12,287)
Provision for loan losses charged to operations 67,439 13,639
-------- --------
Balance at end of period $490,704 $429,241
-------- --------
-------- --------
An analysis of the changes of loans to directors and executive officers is as
follows:
Six Months Ended Year Ended
June 30, 1997 December 31, 1996
---------------- -----------------
Balance at beginning of year $315,605 $262,180
Loans originated 430,446 110,623
Loan principal payments and other reductions (202,736) (57,198)
-------- --------
Balance at end of period $543,315 $315,605
-------- --------
-------- --------
10
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NOTE E - NON-PERFORMING ASSETS - BANK
The composition of the Bank's portfolio of non-performing assets is shown in the
following table.
June 30, 1997 December 31, 1996
------------- -----------------
(Dollars in Thousands)
Non-accrual loans (1) $ 93 $ 53
Past due 90 days or more and still accruing -- --
Renegotiated loans (2) 1,533 1,573
Real estate owned (3) 49 86
------ ------
Total non-performing assets $1,675 $1,712
------ ------
------ ------
Ratio of non-performing assets to total assets 1.60% 1.60%
------ ------
------ ------
(1) Generally refers to loans that are contractually delinquent (i.e., payments
were due and unpaid for more than 90 days).
(2) Renegotiated loans are those for which the interest rate or other terms
were renegotiated because of the inability of borrowers to service the
obligation under the original terms of the agreements and loans to
facilitate the sale of real estate.
(3) Refers to real estate acquired by the Bank through foreclosure or voluntary
deed.
NOTE F - INCOME TAXES
At December 31, 1996, the Company had remaining net operating loss ("NOL")
carryforwards of approximately $6,487,000 for federal income tax purposes which
expire in varying amounts through 2010. The Company also had a capital loss
carryforward of $88,000 for tax purposes which will expire in 1998 and 1999. In
addition, the alternative minimum tax ("AMT") NOL carryforward and AMT credit
carryforward were approximately $6,860,000 and $101,000, respectively, which
expire in varying amounts through 2010. Investment tax credit carryforwards of
approximately $44,000 expire in varying amounts through 2005. At December 31,
1996, the Bank had remaining NOL carryforwards of approximately $43,947,000 for
state income tax purposes which expire in varying amounts through 2005. These
state NOL carryforwards are substantially more than the federal NOL
carryforwards as a result of the exclusion of U.S. investment security and other
income for state income tax purposes.
NOTE G - 1997 STOCK OPTION PLAN
During May 1997, the stockholders of the Company approved the ACCESS ANYTIME
BANCORP, INC. 1997 STOCK OPTION AND INCENTIVE PLAN (the "Plan"). The terms of
the Plan, among other things, provide that the aggregate number of shares of
stock that may be issued under the Plan may not exceed 180,000 shares. In
connection therewith, on May 30, 1997, 50,000 stock options were issued to
various key employees and 40,000 were issued to outside directors of the
Company, all of which have an exercise price of $5.625 each.
11
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NOTE H - SUBSEQUENT EVENT
As previously reported, on February 1, 1996, an Order of Dismissal was entered
by the court with respect to a certain derivative lawsuit ("Derivative Lawsuit")
which had been filed in the State District Court in Curry County, New Mexico on
May 19, 1994 and amended on November 2, 1994. The Derivative Lawsuit was filed
by two stockholders, one of whom was a former director of the Bank, alleging a
number of intentional and negligent acts and omissions in the management of the
Bank which allegedly resulted in damages and losses suffered by the Bank. The
court dismissed, with prejudice, all claims against all defendants, except a
former president, who was also chief executive officer and a director (the
"Former President") of the Bank. A dismissal with prejudice means that the
charges cannot be refiled. The court also ordered plaintiffs to pay reasonable
expenses, including attorney's fees, to the Bank's former independent auditors.
The plaintiffs appealed to the New Mexico Court of Appeals. On July 3, 1997,
the Court of Appeals affirmed the trial court's dismissal of the amended
complaint. On July 18, 1997 the plaintiffs filed a motion for rehearing in the
Court of Appeals.
With respect to the Former President, the trial court had dismissed the claims
in the Derivative Lawsuit without prejudice in order to allow the Bank to pursue
such claims in Federal Court. In May 1995, the Bank filed a lawsuit against the
Former President in the United States District Court for the District of New
Mexico. The Bank's lawsuit against the Former President has been settled, and
the lawsuit was dismissed with prejudice on July 9, 1997.
12
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
FINANCIAL CONDITION
The Company sold 460,878 shares of common stock at a price of $5.25 per share in
the first and second quarters of 1997, resulting in a net increase in total
stockholders' equity of $2,255,191.
Total assets in the Company decreased by approximately $2,220,563 or 2.06% from
December 31, 1996 to June 30, 1997. The decrease in total assets was caused
primarily by a decrease in securities available-for-sale of $6.9 million and
securities held-to-maturity of $4.0 million, partially offset by increases in
loans receivable of $6.9 million and certificates of deposit of $1.2 million.
The decrease in securities available-for-sale was primarily due to sales of
securities in the amount of $5.4 million at a gain of $20,637 for the six month
period ended June 30, 1997. Management of the Bank continues to decrease
securities available-for-sale and held-to-maturity securities while increasing
the loan portfolio. Deposits decreased $2,391,917 or 2.44% and Federal Home
Loan Bank (FHLB) advances decreased by $2.7 million from December 31, 1996 to
June 30, 1997.
13
CAPITAL ADEQUACY AND LIQUIDITY - BANK
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, effective date of the new
capital standards, the Bank must have: (1) core capital equal to 3% of adjusted
total assets; (2) tangible capital equal to 1.5% of adjusted total assets; and
(3) total capital equal to 8.0% of risk-weighted assets, which includes off-
balance sheet items.
The following table is a reconciliation of the BANK'S capital for regulatory
purposes at June 30, 1997 as reported to the OTS.
Tangible Core Risk-based
Assets capital capital capital
------------ ----------- ----------- ------------
Total assets $104,441,242
Unrealized gain on securities
available-for-sale, net (6,559)
------------
Adjusted regulatory total assets $104,434,683
------------
------------
Risk-based assets $ 46,537,000
------------
------------
Stockholders' equity $7,486,720 $7,486,720 $7,486,720
Unrealized gain on securities
available-for-sale, net (6,559) (6,559) (6,559)
General valuation allowance -- -- 490,704
---------- ----------- -----------
Regulatory capital 7,480,161 7,480,161 7,970,865
Regulatory capital required 1,566,520 3,133,040 3,722,960
---------- ---------- ----------
Excess regulatory capital $5,913,641 $4,347,121 $4,247,905
Bank's capital to adjusted ---------- ---------- ----------
---------- ---------- ----------
regulatory assets 7.16% 7.16%
Bank's capital to risk-based assets ----------- ----------
----------- ---------- 17.13%
----------
----------
At June 30, 1997 and December 31, 1996, the Bank met the foregoing minimum
tangible, core and risk-based capital levels. A supervisory agreement between
the Board of Directors of the Bank and OTS required that the Bank achieve core
capital of 7% as of June 30, 1997. This requirement was met on April 30, 1997
and maintained through June 30, 1997.
14
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. As of June 30, 1997, the Bank had $300,000 in
borrowings at the FHLB but does not anticipate significant borrowings from the
FHLB in the foreseeable future.
INFLATION - The general rate of inflation over the past three years, as measured
by the Consumer Price Index, has not changed significantly. Therefore,
management does not consider the effects of inflation on the Bank's financial
position and results of operations to be material.
15
RESULTS OF OPERATIONS
THREE-MONTH COMPARATIVE ANALYSIS FOR PERIODS ENDED JUNE 30, 1997 AND 1996
Net interest income after provision for loan losses increased by $65,648 for the
three-month period ended June 30, 1997 compared to the three-month period ended
June 30, 1996, despite an increase in provision of loan loss of $18,618. Total
interest expense decreased by $151,256 or 12.7% which more than offset the
decrease in total interest income of $66,990 for the quarter ended June 30, 1996
compared to the prior year. The decrease in total interest income resulted from
decreases in interest income on mortgage-backed securities of $273,250 and U.S.
government agency securities of $84,760, partially offset by an increase in
interest income on loans receivable of $281,591.
Net income for the three-month period ended June 30, 1997 increased by $111,359
or 455.46% compared with the three-month period ended June 30, 1996. The
increase in net income resulted in net income per share of common stock
increasing by $.07 or 175.00% over the prior year. Professional fee expense
decreased by $113,514 for the quarter ended June 30, 1997 compared to the same
period for the prior year, which was primarily the result of a settlement with a
former officer of the Bank. This decrease in professional fees for the quarter
along with a decrease in deposit insurance premium of $26,365, partially offset
by increases in salaries and employee benefits of $38,555 and other expenses of
$50,980, resulted in a net decrease in noninterest expense of $31,904. Total
other income increased by $13,807 for the quarter ended June 30, 1997 compared
with the quarter ended June 30, 1996, primarily due to an increase in other
income from additional service charges on deposit accounts, which began in the
last quarter of 1996.
SIX-MONTH COMPARATIVE ANALYSIS FOR PERIODS ENDED JUNE 30, 1997 AND 1996
Net interest income after provision for loan losses increased by $89,627 for the
six-month period ended June 30, 1997 compared to the six-month period ended June
30, 1996, net of an increase in provision of loan loss of $103,181. The
increase in net interest income is a result of the Bank's effort to increase net
interest income by changing the asset mix. Total interest income decreased by
$188,701 for the six-months ended June 30, 1997 compared to the six-months ended
June 30, 1996, and total interest expense decreased by $381,509 for the same
period resulting in an increase in total interest income before provision for
loan losses of $192,808. The decrease in total interest income resulted from an
increase in loan receivable interest income of $509,258 less decreases in
mortgage-backed interest income of $522,994 and U.S. government agency
securities of $144,967. The total interest expenses decrease was due to a lower
level of interest bearing deposits and a lower average rate paid.
Noninterest income increased by $50,113 for the six-months ended June 30, 1997
compared to the six-month period ended June 30, 1996. The increase in
noninterest income was primarily due to a $20,637 increase in net realized gains
on sales of available-for-sale securities and a $31,400 increase in other
income. Noninterest expenses decreased by $58,871 for the six months ended June
30, 1997 compared to the first six months of 1996. Noninterest expenses that
decreased in the six-month period were deposit insurance premiums, real estate
operations, and professional
16
fees which decreased by $65,899, $37,656, and $117,956, respectively. The
decreases in deposit insurance premiums and real estate operations are expenses
that should generally decline in the future; however, the $117,956 decrease in
professional fees is a one-time adjustment discussed in the three-month results
of operations comparison in this Form 10-QSB. Noninterest expenses that
increased in the six-month period were salaries and employee benefits, occupancy
expenses, and other expenses of $53,282, $29,822, and $64,087, respectively.
These increases were primarily due to the opening a new loan production office,
an increase in loan volume, and the formation of the holding company in the last
half of 1996.
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PART II - OTHER INFORMATION
ITEM 2 - LEGAL PROCEEDINGS
As previously reported, on February 1, 1996, an Order of Dismissal was entered
by the court with respect to a certain derivative lawsuit ("Derivative Lawsuit")
which had been filed in the State District Court in Curry County, New Mexico on
May 19, 1994 and amended on November 2, 1994. The Derivative Lawsuit was filed
by two stockholders, one of whom was a former director of the Bank, alleging a
number of intentional and negligent acts and omissions in the management of the
Bank which allegedly resulted in damages and losses suffered by the Bank. The
court dismissed, with prejudice, all claims against all defendants, except a
former president, who was also chief executive officer and a director (the
"Former President") of the Bank. A dismissal with prejudice means that the
charges cannot be refiled. The court also ordered plaintiffs to pay reasonable
expenses, including attorney's fees, to the Bank's former independent auditors.
The plaintiffs appealed to the New Mexico Court of Appeals. On July 3, 1997,
the Court of Appeals affirmed the trial court's dismissal of the amended
complaint. On July 18, 1997 the plaintiffs filed a motion for rehearing in the
Court of Appeals.
With respect to the Former President, the trial court had dismissed the claims
in the Derivative Lawsuit without prejudice in order to allow the Bank to pursue
such claims in Federal Court. In May 1995, the Bank filed a lawsuit against the
Former President in the United States District Court for the District of New
Mexico. The Bank's lawsuit against the Former President has been settled, and
the lawsuit was dismissed with prejudice on July 9, 1997.
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ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Company held an annual meeting of stockholders on May 30, 1997. The
following table sets forth certain information relating to each of the matters
voted upon at the meeting.
Votes
--------------------------------------------------------------
Against or Broker
Matters Voted Upon For Withheld Abstentions Non-Votes
1. Election of Directors:
James Clark 866,343.7 8,163 * *
Dr. Everett Frost 805,349.7 69,157 * *
Charles Guthals 867,527.7 6,979 * *
Cornelius Higgins 867,493.7 7,013 * *
Alan Moorhead 867,493.7 7,013 * *
David Ottensmeyer 866,343.7 8,163 * *
2. Approval of the amendment to the
Certificate of Incorporation relating
to liability of directors. 855,564.7 11,060 7,882 *
3. Approval of the amendment to the Certificate
of Incorporation relating to the issuance
of stock to directors, officers and
controlling persons. 709,418.7 21,794 5,088 *
4. Approval of the "fair price" amendment to the
Certificate of Incorporation. 714,419.7 4,201 17,680 *
5. Approval of the 1997 Stock Option and
Incentive Plan. 696,403.7 22,810 11,432 *
6. Approval of the Non-Employee Director
Retainer Plan. 688,754.7 28,601 13,290 *
7. Ratification of the selection of Robinson
Burdette Martin & Cowan, L.L.P.
as independent public accountants
for the current year. 872,487.7 1,698 321 *
*Not applicable or not readily available
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ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
*3.1 Certificate of Amendment of Certificate of Incorporation and
Certificate of Incorporation of the Company
**3.2 Amended Bylaws of the Company (incorporated by reference from
the Company's Registration Statement on Form S-8, filed June
2, 1997, SEC File No. 333-28215)
**/***10.10 Non-Employee Director Retainer Plan (incorporated by
reference from the Company's Registration Statement on Form
S-8, filed June 2, 1997, SEC File No. 333-28217)
**/***10.11 1997 Stock Option and Incentive Plan (incorporated by
reference from the Company's Registration Statement on Form
S-8, filed June 2, 1997, SEC File No. 333-28215)
*11.1 Statement re computation of per share earnings
*27.1 Financial Data Schedule
* Filed herewith
** Previously Filed
*** Designates each management contract or compensatory plan or
arrangement required to be identified pursuant to Item 13(a)
of Form 10-KSB.
(b) Reports on Form 8-K.
The following subparagraphs sets forth information concerning the Form
8-K filed during the quarter ended June 30, 1997:
1. On April 11, 1997, a Form 8-K concerning the completion of its
public offering on April 8, 1997.
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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.
ACCESS ANYTIME BANCORP, INC.
Date: July 24, 1997 /s/ Norman R. Corzine
--------------------------------------------
Norman R. Corzine, Chief Executive Officer,
and Chairman of the Board of Directors
(DULY AUTHORIZED REPRESENTATIVE)
Date: July 24, 1997 /s/ Ken Huey, Jr.
--------------------------------------------
Ken Huey, Jr., President, Chief Financial
Officer and Director
(PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER)
(DULY AUTHORIZED REPRESENTATIVE)
21