SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------------
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 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 0-23182
AMB FINANCIAL CORP.
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(Exact name of registrant as specified in its charter)
Delaware 35-1903582
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(State or other jurisdiction I.R.S. Employer
of incorporation or Identification
organization) Number
8230 Hohman Avenue, Munster, Indiana 46321-1578
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(Address of Principal executive offices) (Zip Code)
Registrant telephone number, including area code: (219) 836-5870
Check whether the issuer (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 [ ]
As of May 6, 1997 there were 1,124,125 shares of the Registrant's common
stock issued and 1,014,524 shares outstanding.
Transitional Small Business Disclosure Format(check one): Yes [ ] No [ X ]
AMB FINANCIAL CORP.
FORM 10-Q
TABLE OF CONTENTS
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statements of Financial Condition at
March 31, 1997 (Unaudited) and December 31, 1996
Consolidated Statements of Earnings for the three
months ended March 31, 1997 and 1996
(unaudited)
Consolidated Statements of Cash Flows for the
three months ended March 31, 1997 and 1996
(unaudited)
Notes to Consolidated Financial Statements
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Part II. OTHER INFORMATION
Signatures
Index to Exhibits
Earnings Per Share Analysis(Exhibit 11)
PART I - FINANCIAL INFORMATION
AMB FINANCIAL CORP.
AND SUBSIDIARIES
March 31, December 31,
1997 1996
------------ ------------
(unaudited)
Assets
Cash and amounts due from depository
institutions ........................................ $ 2,359,737 1,473,962
Interest-bearing deposits ................................ 3,014,866 1,093,405
------------ ------------
Total cash and cash equivalents ..................... 5,374,603 2,567,367
Investment securities, available for sale, at fair value . 11,981,645 8,938,937
Investment securities held for trade ..................... 488,993 539,500
Mortgage backed securities, available for sale, at fair .. 3,898,673 4,018,835
value
Loans receivable (net of allowance for loan losses:
$349,530 at March 31, 1997 and
$354,631 at December 31, 1996) ...................... 69,023,929 67,365,632
Stock in Federal Home Loan Bank of Indianapolis .......... 545,600 545,600
Accrued interest receivable .............................. 468,936 452,955
Office properties and equipment- net ..................... 519,798 510,603
Prepaid expenses and other assets ........................ 1,340,811 1,162,631
------------ ------------
Total assets ........................................ 93,642,988 86,102,060
============ ============
Liabilities and Stockholders' Equity
Liabilities
Deposits ................................................. 67,572,713 60,410,997
Borrowed money ........................................... 9,500,000 9,500,000
Advance payments by borrowers for taxes
and insurance ....................................... 588,623 312,213
Other liabilities ........................................ 721,813 708,993
------------ ------------
Total liabilities ................................... 78,383,149 70,932,203
------------ ------------
AMB FINANCIAL CORP.
AND SUBSIDIARIES
March 31, December 31,
1997 1996
------------ ------------
(unaudited)
Stockholders' Equity
Preferred stock, $.01 par value; authorized
100,000 shares; none outstanding .................... -- --
Common Stock, $.01 par value; authorized 1,900,000 shares;
1,124,125 shares issued and 1,067,919 shares
outstanding at March 31, 1997 and December 31, 1996 11,241 11,241
Additional paid- in capital .............................. 10,664,496 10,657,746
Retained earnings, substantially restricted .............. 6,739,531 6,564,203
Unrealized gain (loss) on securities available for sale,
net of income taxes ................................. (90,657) 30,386
Treasury Stock at cost, (56,206 shares) .................. (724,717) (724,717)
Common stock acquired by Employee Stock Ownership
Plan ................................................ (809,370) (809,370)
Common stock awarded by Recognition and Retention Plan ... (530,685) (559,632)
------------ ------------
Total stockholders' equity .......................... 15,259,839 15,169,857
------------ ------------
Total liabilities and stockholders' equity ............... $ 93,642,988 86,102,060
============ ============
See accompanying notes to consolidated financial statements.
AMB FINANCIAL CORP.
AND SUBSIDIARIES
Consolidated Statements of Earnings
Three Months Ended
March 31
---------------------------
1997 1996
---------- ----------
(unaudited) (unaudited)
Interest Income
Loans ................................... $1,422,391 1,145,610
Mortgage-backed securities .............. 67,986 26,008
Investment Securities ................... 159,517 110,730
Interest-bearing deposits ............... 31,178 39,776
Dividends on FHLB stock ................. 10,561 10,852
---------- ----------
Total Interest Income .............. 1,691,633 1,332,976
---------- ----------
Interest Expense
Deposits ................................ 700,532 696,137
Borrowings .............................. 136,366 46,124
---------- ----------
Total Interest Expense ............. 836,898 742,261
---------- ----------
Net interest income before
provision for loan losses ........ 854,735 590,715
Provision for loan losses .................... 5,155 --
---------- ----------
Net interest income after
provision for loan losses ........ 849,580 590,715
---------- ----------
Non-interest income:
Loan fees and service charges ........... 21,888 19,662
Commission income ....................... 9,886 25,858
Deposit related fees .................... 39,319 41,338
Gain on sale of investment securities
held for trade ........................ 13,490 --
Unrealized gain on investment
securities held for trade ............. 48,003 --
Other income ............................ 25,975 25,180
---------- ----------
Total non-interest income .......... 158,561 112,038
---------- ----------
AMB FINANCIAL CORP.
AND SUBSIDIARIES
Consolidated Statements of Earnings
(continued)
Three Months Ended
March 31
---------------------------
1997 1996
---------- ----------
(unaudited)
Non-interest expense:
Staffing costs .......................... 299,191 257,243
Advertising ............................. 24,557 20,533
Occupancy and equipment expense ......... 87,796 83,579
Data processing ......................... 81,690 67,980
Federal deposit insurance premiums ...... 10,423 33,763
Other operating expenses ................ 126,130 110,012
---------- ----------
Total non-interest expense ......... 629,787 573,110
---------- ----------
Net income before income taxes ............... 378,354 129,643
Provision for federal and state
income taxes ............................... 143,807 43,820
---------- ----------
Net income ......................... 234,547 85,823
========== ==========
Earnings per share- primary .................. $ 0.24 $ 0.08
Earnings per share- fully diluted ............ $ 0.24 $ 0.08
See accompanying notes to consolidated financial statements.
AMB FINANCIAL CORP.
AND SUBSIDIARIES
Consolidated Statements of Cash Flows
Three Months Ended
March 31,
------------------------------
1997 1996
------------ ------------
(unaudited)
Cash flows from operating activities:
Net income .................................................. $ 234,547 85,823
Adjustments to reconcile net income to
net cash from operating activities:
Depreciation ............................................. 35,650 34,105
Amortization of cost of stock benefit plan ............... 28,947 --
Amortization of premiums and accretion of discounts ..... 19 (538)
Increase in deferred compensation ........................ 19,084 16,605
Provision for loan losses ................................ 5,155 --
Gain on sale of investment securities held for trade ..... (13,490) --
Unrealized gain on sale of trading accountsecurities ..... (48,003) --
Proceeds from sale of investment securities held for trade 112,000 --
Increase (decrease) in deferred income on loans .......... 10,345 (6,028)
Increase in accrued and deferred
income taxes ........................................... (76,813) (7,359)
Increase in accrued interest receivable .................. (15,981) (19,494)
Increase in accrued interest payable ..................... 31,589 14,917
Other, net ............................................... (51,770) (52,652)
------------ ------------
Net cash provided by operating activities ..................... 271,279 65,379
------------ ------------
Cash flows from investing activities:
Proceeds from maturities of investment securities ........ 750,000 500,000
Purchase of investment securities ........................ (3,948,806) (1,525,779)
Proceeds from repayments of mortgage-backed securities ... 74,498 92,537
Purchase of mortgage-backed securities ................... -- (502,350)
Property and equipment expenditures ...................... (44,845) (8,425)
Purchase of loans ........................................ (743,121) --
Loan disbursements ....................................... (4,762,321) (3,179,601)
Loan repayments .......................................... 3,831,645 3,429,997
------------ ------------
Net cash provided for investing activities .................... (4,842,950) (1,193,621)
------------ ------------
AMB FINANCIAL CORP.
AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(continued)
Three Months Ended
March 31,
------------------------------
1997 1996
------------ ------------
(unaudited)
Cash flows from financing activities:
Net proceeds from sale of common stock ................... -- 9,791,950
Deposit receipts ......................................... 37,009,209 30,445,964
Deposit withdrawals ...................................... (30,380,372) (30,255,894)
Interest credited to deposits ............................ 532,879 563,164
Increase in advance payments by borrowers
for taxes and insurance ................................ 276,410 181,624
Payment of dividends ..................................... (59,219) --
------------ ------------
Net cash provided by financing activities ..................... 7,378,907 10,726,808
------------ ------------
Net change in cash and cash equivalents ....................... 2,807,236 9,598,566
Cash and cash equivalents at beginning of period .............. 2,567,367 4,036,817
------------ ------------
Cash and cash equivalents at end of period .................... $ 5,374,603 13,635,383
============ ============
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest ................................................. 805,309 727,344
Income taxes ............................................. 50,209 58,059
See accompanying notes to consolidated statements
AMB Financial Corp.
and Subsidiaries
Notes to Consolidated Financial Statements
1. Statement of Information Furnished
The accompanying unaudited consolidated financial statements have been
prepared in accordance with Form 10-Q instructions and Article 10 of Regulation
S-X, and in the opinion of management contains all adjustments (all of which are
normal and recurring in nature) necessary to present fairly the financial
position as of March 31, 1997, the results of operations for the three months
ended March 31, 1997 and 1996 and cash flows for the three months ended March
31, 1997 and 1996. These results have been determined on the basis of generally
accepted accounting principles. The preparation of financial statements in
conformity with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
The attached consolidated statements are those of AMB Financial Corp. (the
"Company") and its consolidated subsidiaries American Savings, FSB (the "Bank");
its wholly owned subsidiary NIFCO, Inc.; and its wholly owned subsidiary Ridge
Management, Inc. The results of operations for the three month periods ended
March 31, 1997 are not necessarily indicative of the results to be expected for
the full year.
2. Mutual to Stock Conversion
In December 1995, the Bank's Board of Directors approved a Plan of
Conversion (the "Conversion"), providing for the Bank's conversion from a
federally chartered mutual savings bank to a federally chartered stock savings
bank with the concurrent formation of a holding company. The Company issued
1,124,125 shares of $.01 par value common stock at $10.00 per share, for an
aggregate purchase price of $11,241,250. The Conversion and sale of 1,124,125
shares of common stock of the Company was completed on March 29, 1996. Net
proceeds to the Company, after conversion expenses, totaled approximately
$10,658,000.
3. Earnings Per Share
Earnings per share for the three month periods ended March 31, 1997 and
1996 were determined by dividing net income for the periods by the weighted
average number of both primary and fully diluted shares of common stock and
common stock equivalents outstanding (see Exhibit 11 attached). Stock options
are regarded as common stock equivalents and are therefore considered in both
primary and fully diluted earnings per share calculations. Common stock
equivalents are computed using the treasury stock method.
4. Impact of New Accounting Standards
Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities. In June 1996, the FASB issued SFAS No. 125
("SFAS 125"), "Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities." This statement, among other things, applies a
"financial-components approach" that focuses on control, whereby an entity
recognizes the financial and servicing assets it controls and the liabilities it
has incurred, derecognizes assets when control has been surrendered, and
derecogonizes liabilities when extinguished. SFAS 125 provides consistent
standards for distinguishing transfers of financial assets that are sales from
transfers that are secured borrowings. SFAS 125 is effective for transfers and
servicing of financial assets and extinguishments of liabilities occurring after
December 31, 1996. The Company has adopted SFAS 125 effective January 1, 1997,
resulting in no material impact on its consolidated financial condition or
results of operation.
Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities. In December 1996, the FASB issued Statement of
Financial Accounting Standards No. 127 ("SFAS 127"), "Deferral of the Effective
Date of Certain Provisions of FASB Statement No. 125". The statement delays for
one year the implementation of SFAS 125, as it relates to (1) secured borrowings
and collateral, and (2) for the transfers of financial assets that are part of
repurchase agreement, dollar-roll, securities lending and similar transactions.
The Company has adopted portions of SFAS 125 (those not deferred by SFAS 127)
effective January 1, 1997. Adoption of these portions did not have a significant
effect on the Company's financial condition or results of operations Based on
its review of SFAS 125, management does not believe that adoption of the
portions of SFAS 125 which have been deferred by SFAS 127 will have a material
effect on the Company.
Accounting for Earnings Per Share. In February 1997, the FASB issued
SFAS No. 128 ("SFAS 128"), "Earnings Per Share". This statement is intended to
simplify the computation of earnings per share ("EPS") by replacing the
presentation of primary EPS with a presentation of basic EPS. Basic EPS does not
include potential dilution and is computed by dividing income available to
common stockholders by an average number of common shares outstanding.
Diluted EPS reflects the potential dilution of securities that could
share in the earnings of a company, similar to the fully diluted EPS currently
used. The statement requires dual presentation of basic and diluted EPS by
companies with complex capital structures. SFAS128 is effective for financial
statements issued for periods ending after December 15, 1997. The Company does
not anticipate that this statement will have an impact on its consolidated
financial condition or results of operations.
The foregoing does not constitute a comprehensive summary of all
material changes or developments affecting the manner in which the Company keeps
its books and records and performs its financial accounting responsibilities. It
is intended only as a summary of some of the recent pronouncements made by the
FASB which are of particular interest to financial institutions.
Management's Discussion and Analysis of Financial
Condition and Results of Operations
FINANCIAL CONDITION
March 31, 1997 compared to December 31, 1996.
Total assets of the Company increased $7.5 million, or 8.8% to $93.6 million at
March 31, 1997 compared to $86.1 million at December 31, 1996. This increase
primarily resulted from increases in cash and cash equivalents of $2.8 million,
investment securities of $3.0 million and loans receivable of $1.7 million,
which were funded by an increase in deposits of $7.2 million.
At March 31, 1997, cash and cash equivalents increased by $2.8 million as excess
funds received from the deposit growth during the first quarter were retained in
anticipation of the withdrawal of several large deposit accounts which are
expected to mature and not renew during the next three months.
Investment securities available for sale increased $3.0 million to $12.0 million
at March 31, 1997 as a result of new purchases of $3.9 million offset by
$750,000 in proceeds from the maturing securities. These new purchases were
primarily in a medium term U.S. Government mutual fund and to a lesser extent,
medium term U.S. Treasury notes.
Loan receivable increased to $69.0 million at March 31, 1997, a $1.7 million or
2.5% increase, as new loan originations of $4.8 million and loan purchases of
$700,000 exceeded loan repayments of $3.8 million. Loan purchases in the first
quarter include a $450,000 loan participation on a multi-family property located
in Hobart, Indiana and a $250,000 equipment lease financing loan.
Total deposits at March 31, 1997 increased by $7.2 million, or 11.85% as deposit
receipts of $37.0 million and interest credited of $533,000 exceeded withdrawal
activity of $30.4 million. This deposit gain is attributable to a special rate 7
month certificate of deposit program, receipt of short term municipal deposits
maturing within a ninety day period and to a lesser extent, a limited number of
brokered deposits. It is anticipated that approximately $4.8 million of
municipal jumbo certificates will mature and not be renewed during the next
three month period. In the event this occurs, the Company will use either short
term interest-bearing deposits and/or borrow short term from the FHLB.
Stockholder's equity increased $90,000 during the quarter primarily as a result
of net income of $235,000 along with normal amortization of RRP and ESOP
benefits of $35,000 which were offset by a decrease of $121,000 in the
unrealized gains on securities available for sale and payment of dividends on
common stock of $59,000.
Results of Operations
The Company's results of operations depend primarily upon the level of net
interest income, which is the difference between the interest income earned on
its interest-earning assets such as loans and investments, and the costs of the
Company's interest-bearing liabilities, primarily deposits and borrowings. Net
interest income depends upon the volume of interest-earning assets and
interest-bearing liabilities and the interest rate earned or paid on them,
respectively. Results of operations are also dependent upon the level of the
Company's non-interest income, including fee income and service charges, and
affected by the level of its non-interest expenses, including its general and
administrative expenses.
Comparison of Operating Results for the
Quarters Ended March 31, 1997 and 1996.
Net Income. The Company's net income for the three month ended March 31, 1997
increased $149,000 to $235,000 as compared to an $86,000 profit for the same
period in 1996. This increase was due to an increase in net interest income of
$264,000 and an increase in non-interest income of $47,000, offset by an
increase in the provision for loan losses of $5,000, an increase in non-interest
expense of $57,000 and an increase in income taxes of $100,000.
Interest Income. Total interest income for the quarter ended March 31, 1997
increased $359,000, or 27%, as compared to the prior year's quarter. The
increase in interest income was the result of an increase in average
interest-earning assets of $18.2 million. The increase in average
interest-earning assets was the result of a $12.7 million increase in the
average balance of loans receivable, a $2.5 million increase in the average
balance of mortgage-backed securities, a $4.1 million increase in the average
balance of investment securities and a $2.3 million increase in the average
balance of interest-bearing deposits. These increases reflect the Company's
investment of net proceeds received from the stock conversion as well as from an
increase in the average balance of interest-bearing liabilities. During the
quarter ended March 31, 1997, the average yield on interest-earning assets
remained constant at 7.93% as compared to the three months ended March 31, 1996.
Interest Expense. Total interest expense for the quarter ended March 31, 1997
increased $95,000, or 12.7%, to $837,000 as compared to $742,000 in the prior
year's quarter. The increase in interest expense was due primarily to the
increase of $8.8 million in the average balance of interest-bearing liabilities
from $64.7 million for the three months ended March 31, 1996 to $73.5 million
for the three months ended March 31, 1997. The increase in interest expense was
partially offset by the slightly lower average rate paid on interest-bearing
liabilities of 4.55% for the three months ended March 31, 1997 from 4.59 % for
the three months ended March 31, 1996. The increase in average interest-bearing
liabilities was primarily due to an increase in jumbo certificates of deposit
from local municipalities as previously discussed.
Provision for Loan Losses. The determination of the allowance for loan losses
involves material estimates that are susceptible to significant change in the
near term. The allowance for loan losses is maintained at a level deemed
adequate to provide for losses through charges to operating expense. The
allowance is based upon past loss experience and other factors which, in
management's judgment, deserve current recognition in estimating losses. Such
other factors considered by management include growth and composition of the
loan portfolio, the relationship of the allowance for losses to outstanding
loans, and economic conditions.
A provision for loan losses of $5,000 was recorded during the three months ended
March 31, 1997 while no provision was recorded in the comparable 1996 period.
The increase in the provision for losses on loans was primarily due to the
continuing growth in loans receivable. The Bank will continue to review its
allowance for loan losses and make future provisions as economic and regulatory
conditions dictate. Although the Bank maintains its allowance for loan losses at
a level that it considers to be adequate to provide for losses, there can be no
assurance that future losses will not exceed estimated amounts or that
additional provisions for loan losses will not be required in future periods.
Non-Interest Income. The Company's non-interest income increased $47,000 to
$159,000 for the quarter ended March 31, 1997 compared to $112,000 for the same
quarter a year ago. The increase was due primarily from gains on the sale of
investment securities held for trade of $13,000 and an unrealized gain on the
Company's trading portfolio of $48,000, both of which did not occur in the prior
year's quarter, partially offset by a $16,000 decrease in commission income from
the sale of various financial products by the Bank's wholly owned subsidiary,
NIFCO, Inc.
Non-Interest Expense. The Company's non-interest expense increased $57,000 to
$630,000 for the quarter ended March 31, 1997 compared to $573,000 for the same
quarter a year ago. The increase resulted primarily from increased staffing
costs of $42,000 due to normal salary and benefit increases and the expense
recognition of the ESOP and RRP, $24,000 of expenses relating to operations as a
public company which did not occur in the prior year's quarter, $14,000 of
additional data processing costs associated with consolidation of the
VISA/Mastercard program into strictly a VISA charge card program and to
increased debit card activity. These increased costs were partially offset by a
decrease of $23,000 in federal deposit insurance premiums which was the result
of legislation enacted in September 1996 to recapitalize the Savings Association
Insurance Fund. As a result of this legislation, highly rated institutions, such
as the Bank, have begun paying substantially reduced deposit insurance premiums
beginning January 1, 1997.
Provision for Income Taxes. Income tax expense for the quarter ended March 31,
1997 increased by $100,000 as compared to the prior years quarter as a result of
increased income before taxes.
Liquidity and Capital Resources
The Company's principal sources of funds are deposits, proceeds from principal
and interest payments on loans (including mortgage-backed securities), sales or
maturities of investment securities, borrowings and income from operations.
While scheduled loan repayments and maturing investments are relatively
predictable, deposit flows and early loan repayments are more influenced by
interest rates, floors and caps on loan rates, general economic conditions and
competition. The primary business activity of the Company, that of making
conventional mortgage loans on residential housing, is likewise affected by
economic conditions.
Federal regulations require the Bank to maintain minimum levels of liquid
assets. The required percentage has varied from time to time based upon economic
conditions and savings flows and is currently 5% of net withdrawable savings
deposits and borrowings payable on demand in one year or less during the
preceding calendar month. Liquid assets for purposes of this ratio include cash,
certain time deposits, U.S. Government, government agency and corporate
securities and other obligations generally having remaining maturities of less
than five years. The Bank has historically maintained its liquidity ratio for
regulatory purposes at levels in excess of those required. At March 31, 1997 the
Bank's liquidity ratio for regulatory purposes was 21.36%.
The Company's most liquid assets are cash and cash equivalents, which consist of
interest-bearing deposits and short-term highly liquid investments with original
maturities of less than three months that are readily convertible to known
amounts of cash. The level of these assets is dependent on the Company's
operating, financing and investing activities during any given period. At March
31, 1997 and December 31, 1996, cash and cash equivalents totaled $5.4 million
and $2.6 million respectively.
Liquidity management for the Company is both a daily and long-term function of
the Company's management strategy. Excess funds are generally invested in
short-term investments, such as overnight deposits. If the Company requires
funds beyond its ability to generate them internally, additional funds are
available through FHLB advances.
The Company anticipates that it will have sufficient funds available to meet
current commitments. At March 31, 1997 the Company has outstanding loan
commitments totaling $617,000 and unused lines of credit granted totaling $4.8
million.
Federally insured savings associations, such as the Bank, are required to
maintain a minimum level of regulatory capital. The OTS has established capital
standards, including a tangible capital requirement, a leverage ratio (or core
capital) requirement and a risk-based capital requirement applicable to such
savings associations. These capital requirements must be generally as stringent
as the comparable capital requirements for national banks. The OTS is also
authorized to impose capital requirements in excess of these standards on
individual associations on a case-by-case basis.
At March 31, 1997, the Bank had core capital equal to $11.3 million, or 12.2% of
adjusted total assets which was $8.6 million above the minimum leverage ratio
requirement of 3% in effect on that date. The Bank had total capital of $11.7
million (including $11.3 million in core capital and $350,000 in qualifying
supplementary capital) and risk-weighted assets of $50.8 million (including no
converted off-balance sheet assets); or total risk-based capital of 23.0% of
risk-weighted assets at March 31, 1997. This amount was $7.6 million above the
8% requirement in effect on that date.
Non-Performing Assets
The following table sets forth the amounts and categories of
non-performing assets in the Company's portfolio. Loans are reviewed monthly and
any loan whose collectibility is doubtful is placed on non-accrual status. Loans
are placed on non-accrual status when principal and interest is 90 days or more
past due, unless, in the judgement of management, the loan is well
collateralized and in the process of collection. Interest accrued and unpaid at
the time a loan is placed on non-accrual status is charged against interest
income. Subsequent payments are either applied to the outstanding principal
balance or recorded as interest income, depending on the assessment of the
ultimate collectibility of the loan. Restructured loans include troubled debt
restructuring (which involved forgiving a portion of interest or principal on
any loans or making loans at a rate materially less than the market rate). At
March 31, 1997, the Company had no restructured loans or foreclosed assets.
March 31 December 31
1997 1996
---- ----
(Dollars in thousands)
Non- accruing loans:
One to four family ........................ $544 302
Multi- family ............................. -- --
Non- residential .......................... -- --
Construction .............................. -- --
Consumer .................................. 1 3
---- ----
Total .......................................... 545 305
---- ----
Total non- performing assets ................... $545 305
==== ====
Total as a percentage of total assets .......... 0.58% 0.35%
==== ====
For the quarter ended March 31, 1997, gross interest income which would have
been recorded had the non-accruing loans been current in accordance with their
original terms amounted to $7,000.
In addition to the non-performing assets set forth in the table above, as of
March 31, 1997, there were no loans with respect to which known information
about the possible credit problems of the borrowers or the cash flows of the
security properties have caused management to have concerns as to the ability of
the borrowers to comply with present loan repayment terms and which may result
in the future inclusion of such items in the non- performing asset categories.
Management has considered the Company's non-performing and "of concern" assets
in establishing its allowance for loan losses.
Recent Developments
On January 31, 1997, the Company announced its intention to repurchase up to
53,359 shares, or approximately 5% of its outstanding shares over the next
twelve months. This repurchase program is to be accomplished by purchasing
shares in open market transactions, from time to time, subject to availability.
As of May 6, 1997 all shares have been purchased.
The Company declared a cash dividend of $.06 per share, payable on May 21, 1997
to shareholders of record on May 7, 1997.
On April 25, 1997, the Company announced its intention to repurchase up to
50,728 shares, or approximately 5% of the then outstanding shares over the next
twelve months. This repurchase program is to be accomplished by purchasing
shares in open market transactions, from time to time, subject to availability.
As of May 6, 1997 no shares have been purchased.
PART II - OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
From time to time, the Bank is a party to legal proceedings in the
ordinary course of business, wherein it enforces its security interest.
The Company and the Bank are not engaged in any legal proceedings of a
material nature at the present time.
Item 2. CHANGES IN SECURITIES
None.
Item 3. DEFAULTS UPON SENIOR SECURITIES
None.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The following items were presented to shareholders at the Company's
Annual Meeting on April 23, 1997:
1. The election of Clement B. Knapp, Jr. and Donald L. Harle to serve
as directors for terms of three years or until successors have been
elected and qualified.
2. The ratification of the appointment of Cobitz, VandenBerg & Fennessy
as auditors for the Company for the fiscal year ending December 31,
1997.
Both of the above items were approved by shareholders at the meeting.
The election of Clement B. Knapp, Jr. was approved by a vote of 924,
802 in favor and 5,750 withheld. The election of Donald D. Harle was
approved by a vote of 928,802 in favor and 1,750 withheld. The
appointment of Cobitz, VandenBerg & Fennessy was ratified by a vote of
919,452 in favor, 600 against and 10,500 abstaining.
Item 5. OTHER INFORMATION
Not applicable.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Computation of earnings per share (Exhibit 11 filed herewith)
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities
and Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
AMB FINANCIAL CORP.
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Registrant
DATE: May 6, 1997
BY:/s/Clement B. Knapp, Jr.
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Clement B. Knapp, Jr.
President and Chief Executive Officer
(Duly Authorized Representative)
BY:/s/Daniel T. Poludniak
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Daniel T. Poludniak
Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)
INDEX TO EXHIBITS
Exhibit No.
No.
11 Statement re: Computation of Per Share Earnings