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): June 20, 2002
MFB Corp.
(Exact name of registrant as specified in its charter)
INDIANA
(State or other jurisdiction of incorporation)
0-23374 35-1907258
Commission File Number) (IRS Employer Identification No.)
121 South Church Street
Post Office Box 528
Mishawaka, Indiana 46544
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (219) 255-3146
Item 5. Other Events.
Pursuant to General Instruction F to Form 8-K, the press release issued June 20,
2002 concerning the May 31, 2002 charge to earnings.
Item 7. Financial Statements and Exhibits.
(c) Exhibits
Exhibit 1 -- Press Release dated June 20, 2002.
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.
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Thomas Flournoy, Chief Financial Officer
Dated: June 20, 2002
MFB Corp. Announces Third Quarter Charge to Earnings
June 20, 2002
Mishawaka, Indiana - MFB Corp. (NASDAQ/MFBC) (the "Company"), parent
company of MFB Financial (the "Bank"), based in Mishawaka, Indiana, announced
today that it will take a specific charge against earnings of $750,000 ($450,000
net of tax) for the quarter ending June 30, 2002 with respect to a commercial
loan made by the Bank to a furniture manufacturing company. The net of tax
charge represents $0.33 diluted earnings per share. The loan balance following
this charge was approximately $1.94 million and there remains a $400,000
specific reserve established for the loan.
In March, 2000 a credit facility was granted to a previous borrower.
That borrower was unable to successfully operate the business and the business
was sold to the current borrowers. In conjunction with this sale, the Bank
originated a loan in the principal amount of $2,000,000 to the current borrowers
in October, 2000. Subsequently, the Bank loaned an additional $940,000 to those
borrowers. The efforts of this new management to revitalize the business failed
and the current borrowers ceased operations in January, 2002. The borrowers
have not made principal and interest payments on the loan since December, 2001.
The Company previously recorded a $500,000 charge against earnings on this loan
in the quarter ended March 31, 2002, as disclosed in its quarterly report on
Form 10-Q for that period.
The loan is secured by real estate, machinery, equipment and inventory.
After conducting an analysis of the liquidation value of this collateral, the
Company determined that the additional charge to earnings announced today would
be necessary. The Company cannot estimate at this time how much of the loan it
will ultimately recover from the disposition of the collateral or from the
personal guarantee provided by one of the principals of the borrower. The
Company expects to announce its third quarter operating results around July 17,
2002.
MFB Corp's wholly owned bank subsidiary, MFB Financial, provides retail
and small business financial services to the Michiana area through its seven
banking centers in St. Joseph and Elkhart counties. MFB Financial comprises over
99% of the assets of MFB Corp.
The foregoing discussion contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995, which
involve a number of risks and uncertainties. A number of factors could cause
results to differ materially from the objectives and estimates expressed in such
forward-looking statements. These factors include, but are not limited to,
changes in economic conditions in the company's market area, changes in policies
by regulatory agencies, fluctuations in interest rates, demand for loans in the
company's market area, and competition, all or some of which could cause actual
results to differ materially from historical earnings and those presently
anticipated or projected. These factors should be considered in evaluating any
forward-looking statements, and undue reliance should not be placed on such
statements. The Corporation does not undertake and specifically disclaims any
obligations to update any forward-looking statements to reflect occurrence of
anticipated or unanticipated events or circumstances after the date of such
statements.