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) January 22, 2003
-------------------------------
NORTH BANCSHARES, INC.
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its Charter)
Delaware 0-22800 36-3915073
- -------------------------------------------------------------------------------
(State or other (commission file number) (IRS Employer
jurisdiction of Identification
incorporation) number)
100 West North Avenue, Chicago, Illinois 60610
- -------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (312) 664-4320
N/A
- -------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
Item 5. Other Events
On January 22, 2003, the Registrant issued the attached press release.
Item 7. Financial Statements and Exhibits
(a) Exhibits
1. Press Release, dated January 22, 2003, regarding fourth quarter 2002
earnings, declaration of a regular quarterly dividend and the date of
the annual stockholders meeting.
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: Janary 22, 2003 /S/ Joseph A. Graber
--------------- --------------------
Joseph A. Graber
President and
Chief Executive Officer
CERTIFICATION
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each of the
undersigned hereby certifies in his capacity as an officer of North Bancshares,
Inc. (the "Company") that the Current Report on Form 8-K for the event on
January 21, 2003 fully complies with the requirements of Section 13(a) of the
Securities Exchange Act of 1934 and that the information contained in such
report fairly presents, in all material respects, the financial condition and
results of operations of the Company as of the dates and for the periods
presented in the financial statements included in such report.
Dated: January 22, 2003 /S/ Joseph A. Graber
------------------- -----------------------
Joseph A. Graber
President and Chief Executive Officer
Dated: January 22, 2003 /S/ Martin W. Trofimuk
------------------- ------------------------
Martin W. Trofimuk
Vice President, Treasurer and
Chief Financial Officer
EXHIBIT
NORTH BANCSHARES, INC. NEWS
100 West North Avenue - 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
FOURTH QUARTER EARNINGS
QUARTERLY DIVIDEND DECLARED
ANNUAL MEETING DATE
CHICAGO, IL, JANUARY 22, 2003, - North Bancshares, Inc., (NASDAQ-NBSI),
the holding company of North Federal Savings Bank today announced both basic and
diluted earnings per share increased to $.17 for the quarter ended December 31,
2002 compared with $.10 per share for the quarter ended December 31, 2001. Net
income for the quarter ended December 31, 2002 increased by $74,000 and amounted
to $188,000 compared with $114,000 for the quarter ended December 31, 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
February 14, 2003 to stockholders of record as of January 31, 2003 and set
Friday, April 25, 2003 at 4:00 PM at the main office of the Bank as the date,
time and place of the Company's annual meeting of stockholders.
Net interest income, before provision for loan losses, increased by
$49,000 to $948,000 for the quarter ended December 31, 2002, compared with
$899,000 for the quarter ended December 31, 2001. The increase was attributable
to a $199,000 reduction in total interest expense partially offset by a $150,000
decrease in interest income.
Non-interest income increased by $83,000 to $182,000 for the quarter
ended December 31, 2002 compared with $99,000 for the quarter ended December 31,
2001. The increase was primarily attributable to a $64,000 increase in gain on
the sale of investment securities available for sale and a $17,000 increase in
gain on sale of mortgage loans held for sale.
Non-interest expense increased by $23,000 to $817,000 for the quarter
ended December 31, 2002 compared with $794,000 for the quarter ended December
31, 2001. The increase was primarily attributable to a $17,000 increase in
compensation and benefits and a #13,000 increase in data processing expense
partially offset by a $7,000 decrease in advertising expense.
Cash and cash equivalents decreased by $1.4 million to $18.3 million at
December 31, 2002 compared with $19.7 million at December 31, 2001. The decrease
was primarily due to reinvesting federal funds sold into securities available
for sale.
Net loans receivable totaled $86.5 million at December 31, 2002
compared with $93.4 million at December 31, 2001. The $6.9 million decrease was
due primarily to sales of long term fixed rate loans and accelerated repayments
of existing loans due to the decline in interest rates that began in the year
2001 and continued through the year 2002. Equity line of credit loans increased
by $6.8 million to $12.3 million at December 31, 2002 from $5.5 million at
December 31, 2001. The Bank originated $46.0 million in loans during the year
2002 and recorded $49.0 million in repayments and $3.9 million in loan sales
compared with $35.6 in originations, $30.5 million in repayments and $2.3
million in loan sales during the year 2001. At December 31, 2002, the Bank had
$1.8 million in loan applications pending approval or closing and $9.7 in unused
lines of credit. The company did not add to the allowance for loan losses during
the quarter compared with $14,000 during the quarter ended December 31, 2001,
due primarily to continued strong credit quality and a decrease in the loan
portfolio. The total allowance for loan losses amounted to $326,000 or 0.38% of
loans receivable at December 31, 2002 compared with $298,000 and 0.32% of loans
receivable at December 31, 2001. There were no loans delinquent 60 days or more
at December 31, 2002.
Total deposits increased by $2.7 million and amounted to $90.1 million
at December 31, 2002 compared with $87.4 million at December 31, 2001. The
increase was attributable to a $1.0 million increase in certificates of deposit,
a $1.0 million increase in checking and money market accounts and a $700,000
increase in passbook accounts. Non- interest bearing checking accounts increased
13% to $5.1 million at December 31, 2002 compared with $4.5 million at December
31, 2001. The weighted average cost of deposits decreased to 3.18% at December
31, 2002 from 3.64% at December 31, 2001.
Stockholders' equity was $13.9 million at December 31, 2002 compared
with $13.5 million at December 31, 2001. The increase was primarily attributable
to $301,000 improvement in other comprehensive income (loss) due primarily to
the decline in interest rates and its positive effect on the value of the
securities portfolios. This was partially offset by a $193,000 increase in
treasury stock as a result of stock repurchases partially offset by stock
awards. Retained earnings increased by net income of $720,000 which was
partially offset by $508,000 in dividend payments. The loan that funded the
employee stock ownership plan was repaid in the fourth quarter of 2002 and
therefore stockholders' equity increased by $111,000 although this amount was
offset by ESOP compensation expense recorded during the year. Book value
increased to $12.22 at December 31, 2002 compared with $11.66 at December 31,
2001.
Joseph A. Graber, President and Chief Executive Officer, commented:
"We have taken a number of steps this past year to diversify our loan
portfolio and address our interest rate sensitivity. Our prime rate equity line
of credit programs have been well received and we experienced excellent growth
throughout the year. Our commercial real estate lending program has also
provided us with a portfolio of higher-yielding adjustable rate loans. Both
these portfolios will provide us with an income source that will increase in a
rising rate environment." He added, "We experienced good deposit growth the past
two years but anticipate that some of these funds will find their way back to
the stock market and other investment alternatives as the economy improves."
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 57
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 "will likely
result," "are expected to," "will continue," "is anticipated," "estimate,"
"project" 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. The
Company wishes to advise readers that the factors listed above could affect the
Company's financial performance.
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.
(FINANCIAL STATEMENTS ATTACHED)
--MORE-
NORTH BANCSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
ASSETS DECEMBER 31, 2002 DECEMBER 31, 2001
Cash and due from Banks $ 1,629 1,497
Interest-bearing deposits 4,338 2,446
Federal funds sold 12,253 14,697
Investment in dollar denominated mutual funds 83 1,098
- ------------------------------------------------------------------------- ---------------
TOTAL CASH AND CASH EQUIVALENTS 18,303 19,738
Securities available for sale 26,875 18,753
Stock in Federal Home Loan Bank of Chicago 3,999 2,770
Loans receivable, net of allowance for loan
losses of $326 at December 31, 2002 and $298
at December 31, 2001 86,464 93,425
Accrued interest receivable 503 725
Premises and equipment, net 850 743
Other assets 799 607
- ------------------------------------------------------------------------- ---------------
TOTAL ASSETS 137,793 136,761
- ------------------------------------------------------------------------- ---------------
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------------------------------------------- ---------------
Deposits
Interest-bearing 85,074 82,964
Non-interest-bearing 5,076 4,484
Borrowed Funds 31,000 31,750
Advance payments by borrowers for taxes and
insurance 871 770
Amounts due to broker - 1,000
Accrued interest payable and other liabilities 1,867 2,300
- ------------------------------------------------------------------------- ---------------
TOTAL LIABILITIES 123,888 123,268
- ------------------------------------------------------------------------- ---------------
Preferred stock, $.01 par value. Authorized 500,000
shares; none outstanding - -
Common stock, $.01 par value. Authorized 3,500,000
shares; issued 1,914,075; outstanding 1,138,029 at
December 31, 2002 and 1,156,774 at December 31, 2001 19 19
Additional paid in capital 13,284 13,251
Retained earnings, substantially restricted 12,140 11,928
Treasury stock, at cost (776,046 shares at December
31, 2002 and 757,301 shares at December 31, 2001) (11,745) (11,552)
Accumulated other comprehensive income (loss) 259 (42)
Unearned stock awards (52) -
Common stock acquired by Employee Stock Ownership Plan - (111)
- ------------------------------------------------------------------------- ---------------
TOTAL STOCKHOLDERS' EQUITY 13,905 13,493
- ------------------------------------------------------------------------- ---------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $137,793 136,761
- ------------------------------------------------------------------------- ---------------
-MORE--
NORTH BANCSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
THREE MONTHS ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
2002 2001 2002 2001
INTEREST INCOME:
Loans receivable $1,544 1,710 6,641 6,842
Interest-bearing deposits and federal funds sold 59 98 195 464
Securities available for sale 332 294 1,363 1,738
Dividend on FHLB stock and other interest income 59 42 191 175
- ----------------------------------------------------------------------------------------------------------
TOTAL INTEREST INCOME 1,994 2,144 8,390 9,219
- ----------------------------------------------------------------------------------------------------------
INTEREST EXPENSE:
Deposit accounts 624 766 2,687 3,452
Borrowed funds 422 479 1,733 2,174
- ----------------------------------------------------------------------------------------------------------
TOTAL INTEREST EXPENSE 1,046 1,245 4,420 5,626
- ----------------------------------------------------------------------------------------------------------
NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES 948 899 3,970 3,593
PROVISION FOR LOAN LOSSES - 14 28 36
- ----------------------------------------------------------------------------------------------------------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 948 885 3,942 3,557
- ----------------------------------------------------------------------------------------------------------
NON-INTEREST INCOME:
Gain on sale of securities available for sale 64 - 182 11
Gain on sale of mortgage loans held for sale 34 17 75 64
Other non-interest income 84 82 325 323
- ----------------------------------------------------------------------------------------------------------
TOTAL NON-INTEREST INCOME 182 99 582 398
- ----------------------------------------------------------------------------------------------------------
NON-INTEREST EXPENSE:
Compensation and benefits 476 459 1,848 1,812
Occupancy expense 106 99 442 457
Professional fees 40 43 216 151
Data processing 78 65 268 218
Advertising and promotion 25 32 98 141
Other non-interest expense 92 96 472 378
- ----------------------------------------------------------------------------------------------------------
TOTAL NON-INTEREST EXPENSE 817 794 3,344 3,157
- ----------------------------------------------------------------------------------------------------------
INCOME BEFORE INCOME TAXES 313 190 1,180 798
INCOME TAX EXPENSE 125 76 460 313
- ----------------------------------------------------------------------------------------------------------
NET INCOME $ 188 114 720 485
- ----------------------------------------------------------------------------------------------------------
EARNINGS PER SHARE:
Basic $.17 .10 .62 .42
Diluted $.17 .10 .62 .42
- ----------------------------------------------------------------------------------------------------------
AVERAGE SHARES OUTSTANDING:
Basic 1,134,029 1,144,296 1,154,492 1,149,176
Diluted 1,144,355 1,159,389 1,164,144 1,162,687
- ----------------------------------------------------------------------------------------------------------
COMPREHENSIVE INCOME $188 301 1,021 1,330
- ----------------------------------------------------------------------------------------------------------
--MORE-
SELECTED FINANCIAL RATIOS AND OTHER DATA (UNAUDITED):
THREE MONTHS ENDED FISCAL YEAR ENDED
DECEMBER 31, DECEMBER 31,
2002 2001 2002 2001
PERFORMANCE RATIOS:
- -----------------------------------------------------------------------------------------------------------------
Return on assets (ratio of net income to average total assets) (1) 0.54% 0.33% 0.52% 0.35%
Return on Stockholders' equity (ratio of net income to average equity) 5.45 3.40 5.28 3.72
Interest rate spread information:
Average during period (1) 2.33 2.14 2.49 2.09
End of period (1) 2.21 2.15 2.21 2.15
Net interest margin (1) 2.82 2.69 2.97 2.67
Ratio of operating expenses to average assets (1) 2.35 2.31 2.41 2.30
Efficiency ratio (2) .72 .80 .74 .79
Ratio of average interest-earning assets to average interest-bearing
liabilities 115.68 114.81 114.34 114.03
- ----------------------------------------------------------------------------------------------------------------
DECEMBER 31, 2002 DECEMBER 31, 2001
ASSET QUALITY RATIOS:
- -------------------------------------------------------------------------------------------------------------
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 0.38 0.32
CAPITAL RATIOS:
- -------------------------------------------------------------------------------------------------------------
Stockholders' equity to total assets 10.09 9.87
Average Stockholders' equity to average assets 9.83 9.49
Shares outstanding-actual 1,138,029 1,156,774
Book value per share 12.22 11.66
Number of full service offices 2 2
- -------------------------------------------------------------------------------------------------------------
(1) Annualized for the three month periods presented.
(2) Includes gains on sales.