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) Aril 15, 2003
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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
N/A
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(Former name or former address, if changed since last report)
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Item 7. Financial Statements and Exhibits
(c) Exhibits
99.1. Press release, dated April 15, 2003.
Item 9. Regulation FD Disclosure (Information furnished in this Item 9 is
furnished pursuant to Item 12)
On April 15, 2003, the Registrant issued the attached press release
regarding first quarter 2003 earnings and the declaration of a regular quarterly
dividend. The press release is attached as Exhibit 99.1 to this current report
on Form 8-K and is being furnished pursuant to Item 12 of Form 8-K.
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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 hereunto duly authorized.
NORTH BANCSHARES, INC.
(Registrant)
Date: April 15, 2003 /S/ Joseph A. Graber
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Joseph A. Graber
President and
Chief Executive Officer
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EXHIBIT
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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
FIRST QUARTER EARNINGS
QUARTERLY DIVIDEND DECLARED
CHICAGO, IL, APRIL 15, 2003, - North Bancshares, Inc., (NASDAQ-NBSI),
the holding company of North Federal Savings Bank today announced both basic and
diluted earnings per share decreased to $.06 for the quarter ended March 31,
2003 compared with $.14 per share for the quarter ended March 31, 2002. Net
income for the quarter ended March 31, 2003 decreased by $91,000 and amounted to
$66,000 compared with $157,000 for the quarter ended March 31, 2002. The
decrease was primarily attributable to a $121,000 decrease in net interest
income and a $75,000 increase in non-interest expense. These items were
partially offset by a $38,000 increase in non-interest income and a $49,000
decrease in income tax expense.
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 May
15, 2003 to stockholders of record as of May 1, 2003.
Net interest income, before provision for loan losses, decreased by
$121,000 to $847,000 for the quarter ended March 31, 2003, compared with
$968,000 for the quarter ended March 31, 2002. The decrease was attributable to
a $279,000 reduction in total interest income partially offset by a $158,000
decrease in total interest expense.
Non-interest income increased by $38,000 to $123,000 for the quarter
ended March 31, 2003 compared with $85,000 for the quarter ended March 31, 2002.
The increase was primarily attributable to a $27,000 increase in gain on the
sale of investment securities available for sale.
Non-interest expense increased by $75,000 to $868,000 for the quarter
ended March 31, 2003 compared with $793,000 for the quarter ended March 31,
2002. The increase was primarily attributable to a $67,000 charge related to an
embezzlement by a former employee that was discovered this quarter. The Company
anticipates recovering approximately $17,000 from insurance and is pursuing
criminal and civil actions to recover the balance.
Cash and cash equivalents increased by $6.3 million to $24.6 million at
March 31, 2003 compared with $18.3 million at December 31, 2002. The increase
was primarily due to loan prepayments not reinvested into loans or securities
available for sale at the end of the quarter.
Net loans receivable decreased by $6.0 million and amounted to $80.5
million at March 31, 2003 compared with $86.5 million at December 31, 2002. The
$6.0 million decrease was due primarily to greater than normal prepayments of
loans due to the low interest rate environment. Equity line of credit loans
increased by $2.0 million to $14.3 million at March 31, 2003 from $12.3 million
at December 31, 2002. The Bank originated $8.3 million in loans during the
quarter ended March 31, 2003 and recorded $14.2 million in repayments and
$180,000 loan sales compared with $13.5 million in originations,$12.5 million in
repayments and $509,000 in loan sales during the quarter ended March 31, 2002.
At March 31, 2003, the Bank had $10.2 million in loan applications pending
approval or closing and $10.5 million in unused lines of credit. The company did
not add to the allowance for loan losses during the quarter compared with
$18,000 during the quarter ended March 31, 2002, due primarily to a decrease in
total loans receivable. The total allowance for loan losses amounted to $326,000
or 0.40% of loans receivable at March 31, 2003 compared with $326,000 and 0.38%
of loans receivable at March 31, 2002. There were no mortgage loans delinquent
60 days or more at March 31, 2003.
Total deposits decreased by $400,000 and amounted to $89.8 million at
March 31, 2003 compared with $90.2 million at December 31, 2002. The decrease
was due primarily to a $1.0 million decrease in certificates of deposit
partially
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offset by a $700,000 increase in checking and money market accounts. The
weighted average cost of deposits decreased to 2.75% at March 31, 2003 from
3.46% at March 31, 2002.
Stockholders' equity was $13.8 million at March 31, 2003 compared with
$13.9 million at December 31, 2002. The slight decrease was primarily
attributable to a $58,000 decrease in accumulated other comprehensive income due
primarily to the sale of investment securities available for sale and a $60,000
decrease in retained earnings. The decrease in retained earnings was due to net
income of $66,000 that was offset by $126,000 in dividend payments. Book value
decreased to $12.08 at March 31, 2003 compared with $12.22 at December 31, 2002.
Joseph A. Graber, President and Chief Executive Officer, commented:
"Mortgage loans continue to be refinanced at record rates, continuing a
trend that began in 2001, with the result being a decrease in our interest rate
spread. We remain cautious about investing long term at such low rates and thus
have excess liquidity. We will continue to focus our lending on products that
will adjust to the prime rate." He added, "We hope that the geopolitical issues
that appear to be holding back the economy will be resolved in such a way so
that the local and the national economies will recover to the point where hiring
and investment will again be a priority for businesses large and small."
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 58
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)
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NORTH BANCSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
ASSETS MARCH 31, 2003 DECEMBER 31, 2002
Cash and due from banks $ 1,899 $ 1,629
Interest-bearing deposits 3,224 4,338
Federal funds sold 19,419 12,253
Investment in dollar denominated mutual funds 83 83
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TOTAL CASH AND CASH EQUIVALENTS 24,625 18,303
Securities available for sale 25,068 26,875
Stock in Federal Home Loan Bank of Chicago 4,049 3,999
Loans receivable, net of allowance for loan losses of $326 at
March 31, 2003 and December 31, 2002 80,492 86,464
Accrued interest receivable 484 503
Premises and equipment, net 872 850
Other assets 854 799
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TOTAL ASSETS 136,444 137,793
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LIABILITIES AND STOCKHOLDERS' EQUITY
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Deposits
Interest-bearing 84,879 85,074
Non-interest-bearing 4,910 5,076
Borrowed funds 30,000 31,000
Advance payments by borrowers for taxes and insurance 454 871
Accrued interest payable and other liabilities 2,394 1,867
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TOTAL LIABILITIES 122,637 123,888
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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
1,914,075; outstanding 1,142,927 at March 31, 2003 and 1,138,029 at
December 31, 2002 19 19
Additional paid in capital 13,224 13,284
Retained earnings, substantially restricted 12,080 12,140
Treasury stock, at cost (771,148 shares at March 31, 2003 and 776,046
shares at December 31, 2002) (11,668) (11,745)
Accumulated other comprehensive income 201 259
Unearned stock awards (49) (52)
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TOTAL STOCKHOLDERS' EQUITY 13,807 13,905
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $136,444 $137,793
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NORTH BANCSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
THREE MONTHS ENDED
MARCH 31,
2003 2002
INTEREST INCOME:
Loans receivable $1,431 $1,719
Interest-bearing deposits and federal funds sold 56 58
Securities available for sale 298 303
Dividend on FHLB stock and other interest income 50 34
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TOTAL INTEREST INCOME 1,835 2,114
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INTEREST EXPENSE:
Deposit accounts 587 720
Borrowed funds 401 426
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TOTAL INTEREST EXPENSE 988 1,146
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NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES 847 968
PROVISION FOR LOAN LOSSES - 18
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NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 847 950
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NON-INTEREST INCOME:
Gain on sale of securities available for sale 27 -
Gain on sale of mortgage loans held for sale 7 11
Other non-interest income 89 74
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TOTAL NON-INTEREST INCOME 123 85
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NON-INTEREST EXPENSE:
Compensation and benefits 413 437
Occupancy expense 123 110
Professional fees 40 56
Data processing 72 55
Advertising and promotion 29 24
Other non-interest expense 191 111
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TOTAL NON-INTEREST EXPENSE 868 793
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INCOME BEFORE INCOME TAXES 102 242
INCOME TAX EXPENSE 36 85
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NET INCOME $ 66 $ 157
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EARNINGS PER SHARE:
Basic $.06 $.14
Diluted $.06 $.14
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AVERAGE SHARES OUTSTANDING:
Basic 1,138,681 1,151,616
Diluted 1,148,354 1,161,030
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COMPREHENSIVE INCOME $8 $(95)
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SELECTED FINANCIAL RATIOS AND OTHER DATA (UNAUDITED):
THREE MONTHS ENDED
MARCH 31,
2003 2002
PERFORMANCE RATIOS:
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Return on assets (ratio of net income to average total assets) (1) 0.19% 0.46%
Return on Stockholders' equity (ratio of net income to average
equity) (1) 1.89 4.66
Interest rate spread information:
Average during period (1) 2.09 2.42
End of period (1) 1.97 2.41
Net interest margin (1) 2.53 2.93
Ratio of operating expenses to average assets (1) 2.51 2.34
Efficiency Ratio (2) .89 .75
Ratio of average interest-earning assets to average interest-bearing
liabilities 115.17 114.57
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MARCH 31, 2003 DECEMBER 31, 2002
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 0.40 0.38
CAPITAL RATIOS:
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Stockholders' equity to total assets 10.12 10.09
Average Stockholders' equity to average assets 10.04 9.83
Shares outstanding-actual 1,142,927 1,138,029
Book value per share 12.08 12.22
Number of full service offices 2 2
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(1) Annualized for the three month periods presented.
(2) Includes gains on sales.
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