UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) July 16, 2002
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NORTH BANCSHARES, INC.
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(Exact name of registrant as specified in its Charter)
Delaware 0-22800 36-3915073
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(State or other (commission file number) (IRS Employer
jurisdiction of Identification
incorporation) number)
100 West North Avenue, Chicago, Illinois 60610
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (312) 664-4320
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N/A
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(Former name or former address, if changed since last report)
Item 5. Other Events
On July 16, 2002, the Registrant issued the attached press release.
Item 7. Financial Statements and Exhibits
(a) Exhibits
1. Press Release, dated July 16, 2002, regarding second quarter 2002
earnings and declaration of a regular quarterly dividend.
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 hereunto duly authorized.
NORTH BANCSHARES, INC.
(Registrant)
Date: July 16, 2002 /S/ Joseph A. Graber
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Joseph A. Graber
President and
Chief Executive Officer
EXHIBIT
NORTH BANCSHARES, INC. NEWS
100 West North Avenue at Clark-Chicago, Illinois 60610-312-664-4320
RELEASE: IMMEDIATELY
CONTACT: Joseph A. Graber or Victor E. Caputo or Martin W. Trofimuk
(312) 664-4320
NORTH BANCSHARES ANNOUNCES
SECOND QUARTER EARNINGS
QUARTERLY DIVIDEND DECLARED
CHICAGO, IL, JULY 16, 2002, - North Bancshares, Inc., (NASDAQ-NBSI),
the holding company of North Federal Savings Bank today announced earnings per
share increased to $.11 for both basic and diluted shares for the quarter
ended June 30, 2002, compared with $.10 for both basic and diluted per share
earnings for the quarter ended June 30, 2001. Net income for the quarter ended
June 30, 2002 increased by $23,000 and amounted to $133,000 compared with
$110,000 for the quarter ended June 30, 2001.
Concurrent with this earnings release the Board of Directors of the
Company has declared a quarterly dividend of $.11 per share to be paid on August
15, 2002 to stockholders of record as of August 1, 2002.
Net interest income before provision for loan losses, increased by
$113,000 to $1.0 million for the quarter ended June 30, 2002, compared with
$890,000 for the quarter ended June 30, 2001. The increase was attributable to a
$314,000 reduction in total interest expense partially offset by a $201,000
decrease in interest income.
Non-interest income increased by $18,000 to $113,000 for the quarter
ended June 30, 2002 compared with $95,000 for the quarter ended June 30, 2001.
The increase was primarily attributable to a $20,000 increase in gain on the
sale of investment securities available for sale.
Non-interest expense increased by $93,000 to $888,000 for the quarter
ended June 30, 2002 compared with $795,000 for the quarter ended June 30, 2001.
The increase was primarily attributable to a $78,000 increase in other
non-interest expense and professional fees. The increase in other non-interest
expense was primarily related to an increased volume of equity lines of credit
and the related up-front costs.
Total assets increased by $6.5 million and amounted to $143.3 million
at June 30, 2002 compared with $136.8 million at December 31, 2001. The increase
was primarily attributable to a $9.0 million increase in investment securities
available for sale and a $2.3 million increase in net loans receivable partially
offset by a $6.1 million decrease in cash and cash equivalents.
Cash and cash equivalents decreased by $6.1 million to $13.6 million at
June 30, 2002 compared with $19.7 million at December 31, 2001. The decrease was
due primarily to a $7.4 million decrease in federal funds sold. These funds were
reinvested into longer-term higher-yielding securities available for sale and
loans.
Net loans receivable increased by $2.3 million and amounted to $95.7
million at June 30, 2002 compared with $93.4 million at December 31, 2001. The
Bank originated $24.1 million in loans during the six months ended June 30, 2002
and recorded $20.1 million in repayments and $1.7 million in loan sales compared
with $15.3 million in originations, $13.3 in repayments and $900,000 in loan
sales during the six months ended June 30, 2001. At June 30, 2002, the Bank had
$4.6 million in loan applications pending approval or closing and $10.0 in
unused lines of credit. The company added $10,000 to the allowance for loan
losses during the quarter compared with $7,000 during the quarter ended June 30,
2001. The increased provision was primarily due to
increased commercial real estate and consumer lending activity. The total
allowance for loan losses amounted to $326,000 or 0.34% of loans receivable at
June 30, 2002 compared with $297,600 at December 31, 2001, which amounted to
0.32% of loans receivable. There were no loans delinquent 60 days or more at
June 30, 2002.
Total deposits increased by $4.0 million and amounted to $91.4 million
at June 30, 2002 compared with $87.4 million at December 31, 2001. The increase
was primarily attributable to a $2.2 million increase in money market deposit
accounts along with a $900,000 increase in certificates of deposit. The weighted
average cost of deposits for the three months ended June 30, 2002 decreased to
3.25% from 4.46% at June 30, 2001.
Borrowed funds increased by $2.5 million and amounted to $34.3 million
at June 30, 2002 compared with $31.8 million at December 31, 2001. The increase
was attributable to the use of short-term borrowings to fund short-term
commercial real estate lending which resulted in an interest rate spread that
exceeded the Company's current average interest rate spread.
Stockholders' equity was $13.7 million at June 30, 2002 compared with
$13.5 million at December 31, 2001. There was a $134,000 improvement in the
accumulated other comprehensive income (loss) which was partially offset by
$59,000 in unearned stock awards. Retained earnings increased by net income of
$290,000 which was partially offset by $256,000 in dividend payments. Book value
increased to $11.83 at June 30, 2002 compared with $11.66 at December 31, 2001.
Joseph A. Graber, President and Chief Executive Officer, commented:
"I am pleased with this quarters results. Our efforts at diversifying
our balance sheet along with the improvement in our cost of funds related to the
rapid decline in interest rates have had a positive affect on our interest rate
spread." He added, "Although interest rates are low and relatively steady at
this time, our interest rate sensitivity analysis indicates that we are now in a
much better position to offset the negative effects of a rising interest rate
scenario, which we anticipate will occur as the economy picks up steam in future
periods."
North Bancshares, Inc. is the holding company for North Federal Savings
Bank. Its common stock is traded on the Nasdaq Stock Market under the symbol
"NBSI." North Federal has served the north side of Chicago from its home office
in Old Town since 1886. It also operates a branch office in Wilmette IL. For 55
consecutive quarters, the bank has received a five-star superior rating for
safety from Bauer Financial Reports, Inc., and is rated one of the best in the
nation for safety and soundness by Sheshunoff Information Services, Inc. North
Federal is proud to support local service and non-profit organizations. Its
executives serve or have served on the boards of a variety of local community
organizations. Further information is available on its website at
www.northfederal.com including prior press releases, SEC filings, company
history, and current products, services and interest rates.
When used in this press release the words or phrases "believe," "will
likely result," "are expected to," "will continue," "is anticipated,"
"estimate," "project," "plans" or similar expressions are intended to identify
"forward- looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. 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. By their nature, these statements are subject to numerous
uncertainties that could cause actual results to differ materially from those
anticipated in the statements.
The Company does not undertake any obligation to update any
forward-looking statement to reflect circumstances or events that occur after
the date on which the forward-looking statement is made.
(FINANCIAL STATEMENTS ATTACHED)
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NORTH BANCSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
ASSETS JUNE 30, 2002 DEC 31, 2001
Cash and due from banks $ 1,835 1,497
Interest-bearing deposits 4,160 2,446
Federal funds sold 7,289 14,697
Investment in dollar denominated mutual funds 319 1,098
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TOTAL CASH AND CASH EQUIVALENTS 13,603 19,738
Securities available for sale 27,832 18,753
Stock in Federal Home Loan Bank of Chicago 3,844 2,770
Loans receivable, net of allowance for loan losses of $326 at
June 30, 2002 and $298 at December 31, 2001 95,683 93,425
Accrued interest receivable 751 725
Premises and equipment, net 846 743
Other assets 735 607
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TOTAL ASSETS 143,294 136,761
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LIABILITIES AND STOCKHOLDERS' EQUITY
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Deposits
Interest-bearing 86,548 82,964
Non-interest-bearing 4,815 4,484
Borrowed funds 34,250 31,750
Advance payments by borrowers for taxes and insurance 970 770
Amounts due to broker - 1,000
Accrued interest payable and other liabilities 3,016 2,300
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TOTAL LIABILITIES 129,599 123,268
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Preferred stock, $.01 par value. Authorized 500,000 shares; none
outstanding - -
Common stock, $.01 par value. Authorized 3,500,000 shares; issued
and outstanding 1,158,031 at June 30, 2002 and 1,156,774 at
December 31, 2001 19 19
Additional paid in capital 13,245 13,251
Retained earnings, substantially restricted 11,962 11,928
Treasury stock, at cost (756,044 shares at June 30, 2002 and
757,301 shares at December 31, 2001) (11,508) (11,552)
Accumulated other comprehensive income (loss) 92 (42)
Unearned stock awards (59) -
Common stock acquired by Employee Stock Ownership Plan (56) (111)
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TOTAL STOCKHOLDERS' EQUITY 13,695 13,493
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $143,294 136,761
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NORTH BANCSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
2002 2001 2002 2001
INTEREST INCOME:
Loans receivable $1,690 1,696 3,409 3,403
Interest-bearing deposits and federal funds sold 36 118 94 246
Securities available for sale 359 479 662 976
Other interest income 48 41 82 84
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TOTAL INTEREST INCOME 2,133 2,334 4,247 4,709
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INTEREST EXPENSE:
Deposit accounts 687 887 1,407 1,809
Borrowed funds 443 557 869 1,137
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TOTAL INTEREST EXPENSE 1,130 1,444 2,276 2,946
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NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES 1,003 890 1,971 1,763
PROVISION FOR LOAN LOSSES 10 7 28 11
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NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 993 883 1,943 1,752
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NON-INTEREST INCOME:
Gain on sale of securities available for sale 20 - 20 11
Gain on sale of mortgage loans held for sale 14 9 25 44
Service charges and other non-interest income 79 86 153 158
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TOTAL NON-INTEREST INCOME 113 95 198 213
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NON-INTEREST EXPENSE:
Compensation and benefits 459 445 896 900
Occupancy expense 116 124 226 248
Professional fees 64 43 120 71
Data processing 69 55 124 104
Advertising and promotion 31 36 55 59
Other non-interest expense 149 92 260 183
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TOTAL NON-INTEREST EXPENSE 888 795 1,681 1,565
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INCOME BEFORE INCOME TAXES 218 183 460 400
INCOME TAX EXPENSE 85 73 170 157
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NET INCOME $133 110 290 243
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EARNINGS PER SHARE:
Basic $.12 .10 .25 .21
Diluted $.11 .10 .25 .21
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WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic 1,148,605 1,139,347 1,150,732 1,146,620
Diluted 1,164,359 1,152,318 1,166,191 1,158,579
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COMPREHENSIVE (LOSS) INCOME $519 (74) 424 350
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SELECTED FINANCIAL RATIOS AND OTHER DATA (UNAUDITED):
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
2002 2001 2002 2001
PERFORMANCE RATIOS:
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Return on assets (ratio of net income to average total assets) (1) 0.38% 0.32% 0.42% 0.37%
Return on Stockholders' equity (ratio of net income to average
equity) (1) 3.92 3.45 4.28 3.79
Interest rate spread information:
Average during period (1) 2.49 2.07 2.45 2.04
End of period (1) 2.53 2.14 2.53 2.14
Net interest margin (1) 2.97 2.65 2.95 2.64
Ratio of operating expenses to average assets (1) 2.55 2.31 2.44 2.29
Efficiency ratio .80 .81 .78 .79
Ratio of average interest-earning assets to average interest-bearing
liabilities 114.34 113.60 114.61 113.44
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JUNE 30, 2002 DECEMBER 31, 2001
ASSET QUALITY RATIOS:
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Non-performing assets to total assets 0.00 0.00
Allowance for loan losses to non-performing loans N/A N/A
Allowance for loan losses to loans receivable 0.34 0.32
CAPITAL RATIOS:
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Stockholders' equity to total assets 9.56 9.90
Average Stockholders' equity to average assets 9.82 9.49
Shares outstanding-actual 1,158,031 1,156,774
Book value per share 11.83 11.66
Number of full service offices 2 2
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(1) Annualized for the three and six month periods presented.