SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2003
--------------
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 No. 0-25903
IBT Bancorp, Inc.
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Pennsylvania 25-1532164
- ---------------------------------------- ------------------------------------
(State of incorporation or organization) (I.R.S. employer identification no.)
309 Main Street, Irwin, Pennsylvania 15642
- ---------------------------------------- -------------
(Address of principal executive offices) (zip code)
(724)863-3100
- --------------------------------------------------------------------------------
Issuer's telephone number, including area code
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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
------------ ------------
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). X Yes No
----- -----
Number of shares of Common Stock outstanding as of May 09, 2003: 2,977,655
IBT BANCORP, INC.
Contents
Pages
-----
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements............................................
Consolidated balance sheets at March 31, 2003
(unaudited) and December 31, 2002............................... 1
Consolidated statements of income (unaudited) for the
three months ended March 31, 2003 and 2002 ..................... 2
Consolidated statements of cash flows (unaudited) for
the three months ended March 31, 2003 and 2002.................. 3
Notes to consolidated financial statements...................... 4
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations........................... 5
Item 3. Quantitative and Qualitative Disclosures
About Market Risk............................................... 10
Item 4. Controls and Procedures......................................... 10
PART II - OTHER INFORMATION
Item 1. Legal Proceedings............................................... 11
Item 2. Changes in Securities and Use of Proceeds....................... 11
Item 3. Defaults upon Senior Securities................................. 11
Item 4. Submission of Matters to a Vote of Security-Holders............. 11
Item 5. Other Information............................................... 12
Item 6. Exhibits and Reports on Form 8-K................................ 12
Signatures................................................................ 14
CONSOLIDATED BALANCE SHEETS
IBT BANCORP, INC. AND SUBSIDIARY
March 31, 2003 December 31, 2002
---------------- -----------------
(unaudited)
----------------------------------------
ASSETS
Cash and due from banks $ 14,461,713 $ 12,677,160
Interest-bearing deposits in banks 1,634,413 760,118
Federal funds sold - 1,629,000
Certificates of deposit 100,000 100,000
Securities available for sale 183,600,359 183,564,960
Federal Home Loan Bank stock, at cost 4,453,700 3,152,600
Loans, net 372,466,003 359,871,514
Premises and equipment, net 5,078,237 4,759,015
Other assets 17,769,880 17,520,354
----------------- ----------------
Total Assets $ 599,564,305 $ 584,034,721
================ ================
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Deposits
Non-interest bearing $ 78,465,749 $ 74,339,035
Interest-bearing 389,666,236 393,918,292
---------------- ----------------
Total deposits 468,131,985 468,257,327
Repurchase agreements 14,525,151 14,525,836
Accrued interest and other liabilities 5,644,074 5,100,380
FHLB advances 53,875,451 40,000,000
---------------- ----------------
Total liabilities 542,176,661 527,883,543
Stockholders' Equity
Capital stock, par value $1.25 per share,
50,000,000 shares authorized, 3,023,799
shares issued, 2,977,655 shares
outstanding at March 31, 2003 and
December 31, 2002 3,779,749 3,779,749
Surplus 2,073,102 2,073,102
Retained earnings 50,561,363 48,974,137
Accumulated other comprehensive income 2,316,696 2,667,456
---------------- ----------------
58,730,910 57,494,444
Less: Treasury stock, at cost (1,343,266) (1,343,266)
---------------- ----------------
Total stockholders' equity 57,387,644 56,151,178
---------------- ----------------
Total Liabilities and Stockholders' Equity $ 599,564,305 $ 584,034,721
================ ================
The accompanying notes are an integral part of these consolidated financial
statements.
1
CONSOLIDATED STATEMENTS OF INCOME
IBT BANCORP, INC. AND SUBSIDIARY
Three Months Ended March 31,
2003 2002
----------- ----------
(unaudited)
---------------------------
Interest Income
Loans, including fees $6,437,445 $5,890,544
Investment securities 2,046,119 2,275,029
Federal funds sold 9,992 42,399
---------- ----------
Total interest income 8,493,556 8,207,972
Interest Expense
Deposits 2,363,434 2,648,872
FHLB advances 573,969 516,402
Repurchase agreements 36,388 42,101
---------- ----------
Total interest expense 2,973,791 3,207,376
---------- ----------
Net Interest Income 5,519,765 5,000,596
Provision for Loan Losses 150,000 250,000
---------- ----------
Net Interest Income after Provision
for Loan Losses 5,369,765 4,750,596
Other Income (Losses)
Service fees 570,236 592,604
Investment security gains 224,798 46,924
Debit card fees 154,046 134,073
Other income 491,460 561,739
---------- ----------
Total other income 1,440,540 1,335,340
Other Expenses
Salaries 1,215,430 1,115,323
Pension and other employee benefits 389,521 303,795
Occupancy expense 377,144 316,102
Data processing expense 194,410 166,884
Pennsylvania shares tax 105,804 95,586
Advertising expense 127,679 111,521
Other expenses 836,506 740,499
---------- ----------
Total other expenses 3,246,494 2,849,710
---------- ----------
Income Before Income Taxes 3,563,811 3,236,226
Provision for Income Taxes 934,406 805,240
---------- ----------
Net Income $2,629,405 $2,430,986
========== ==========
Basic Earnings per Share $ 0.88 $ 0.81
========== ==========
Diluted Earnings per Share $ 0.88 $ 0.81
========== ==========
Dividends per Share $ 0.35 $ 0.30
========== ==========
The accompanying notes are an integral part of these consolidated financial
statements.
2
CONSOLIDATED STATEMENTS OF CASH FLOWS
IBT BANCORP, INC. AND SUBSIDIARY
Three Months Ended March 31,
----------------------------
2003 2002
------------ ------------
(unaudited)
----------------------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 2,629,405 $ 2,430,986
Adjustments to reconcile net cash
from operating activities:
Depreciation 199,970 168,855
Increase in cash surrender value of insurance (129,179) (134,355)
Net amortization/accretion of
premiums and discounts 253,790 79,632
Investment security gains (224,798) (46,924)
Provision for loan losses 150,000 250,000
Increase (decrease) in cash due
to changes in assets and liabilities:
Other assets (968,028) (471,603)
Accrued interest and other liabilities 724,389 (439,878)
------------ ------------
Net Cash From Operating Activities 2,635,549 1,836,713
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sales of securities
available for sale 7,338,568 11,423,633
Proceeds from maturities of securities
available for sale 17,143,080 21,046,088
Purchase of securities available for sale (25,077,494) (43,158,361)
Net loans made to customers (11,896,808) (2,111,163)
Purchases of premises and equipment (519,192) (142,887)
Purchase of Federal Home Loan Bank stock (1,301,100) --
------------ ------------
Net Cash Used By Investing Activities (14,312,946) (12,942,690)
CASH FLOWS FROM FINANCING ACTIVITIES
Net (decrease) increase in deposits (125,342) 8,827,904
Net (decrease) increase in securities sold
under repurchase agreements (685) 2,220,431
Dividends paid (1,042,179) (895,708)
Proceeds from FHLB advances 14,000,000 5,000,000
Repayment of FHLB advances (124,549) --
Purchase of treasury stock -- (95,760)
------------ ------------
Net Cash From Financing Activities 12,707,245 15,056,867
------------ ------------
Net Change in Cash and Cash Equivalents 1,029,848 3,950,890
Cash and Cash Equivalents at Beginning of Period 15,066,278 25,218,935
------------ ------------
Cash and Cash Equivalents at End of Period $ 16,096,126 $ 29,169,825
============ ============
The accompanying notes are an integral part of these consolidated financial
statements.
3
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
IBT BANCORP, INC. AND SUBSIDIARY
Period Ended March 31, 2003
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments consisting of normal recurring
accruals considered necessary for a fair presentation have been included.
Operating results for the three months ended March 31, 2003 are not necessarily
indicative of the results that may be expected for the year ended December 31,
2003 or any future interim period. The interim financial statements should be
read in conjunction with the financial statements and footnotes thereto included
in IBT Bancorp, Inc. and subsidiary Annual Report on Form 10-K for the year
ended December 31, 2002.
NOTE B - EARNINGS PER SHARE
Earnings per share are calculated on the basis of the weighted average number of
shares outstanding. The weighted average shares outstanding were 2,977,655 for
the three months ended March 31, 2003 and 2,985,087 for the three months ended
March 31, 2002.
NOTE C - COMPREHENSIVE INCOME
Total comprehensive income for the three months ended March 31, 2003 and 2002
was $2,278,645 and $1,296,243, respectively.
NOTE D - INVESTMENT SECURITIES
Investment securities available for sale consist of the following:
March 2003
---------------------------------------------------------------
Gross Gross
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
------------ ------------- ------------- -------------
Obligations of
U.S. Government Agencies $ 67,817,275 $ 1,413,649 $ -- $ 69,230,924
Obligations of State and
political sub-divisions 36,872,261 1,743,379 (31,662) 38,583,978
Mortgage-backed securities 64,374,190 1,253,216 (75,782) 65,551,624
Other securities 707,152 43,463 -- 750,615
Equity securities 10,319,337 165,682 (1,001,801) 9,483,218
------------- ------------- ------------- -------------
$ 180,090,215 $ 4,619,389 $ (1,109,245) $ 183,600,359
============= ============= ============= =============
4
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The Private Securities Litigation Reform Act of 1995 contains safe harbor
provisions regarding forward-looking statements. When used in this discussion,
the words "believes", "anticipate", "contemplates", "expects", and similar
expressions are intended to identify forward-looking statements. Such statements
are subject to certain risks and uncertainties which could cause actual results
to differ materially from those projected. Those risks and uncertainties include
changes in interest rates, risks associated with the effect of opening a new
branch, the ability to control costs and expenses, and general economic
conditions.
Recent Legislation to Curtail Corporate Accounting Irregularities. On July
30, 2002, President Bush signed into law the Sarbanes-Oxley Act of 2002 (the
"Act"). The Securities and Exchange Commission (the "SEC") promulgated certain
regulations pursuant to the Act and will continue to propose additional
implementing or clarifying regulations as necessary in furtherance of the Act.
The passage of the Act and the regulations implemented by the SEC subject
publicly-traded companies to additional and more cumbersome reporting
regulations and disclosure. Compliance with the Act and corresponding
regulations may increase the Company's expense.
GENERAL
IBT Bancorp, Inc. is a bank holding company headquartered in Irwin,
Pennsylvania, which provides a full range of commercial and retail banking
services through its wholly owned banking subsidiary, Irwin Bank & Trust Co.
(collectively, the "Company").
On April 1, 2003, the Company's stock began trading on the American Stock
Exchange under the symbol IRW.
FINANCIAL CONDITION
On March 31, 2003, total assets increased $15.5 million, or 2.7%, to $599.5
million from $584.0 million at December 31, 2002. Asset growth was primarily due
to an increase of $12.6 million in net loans. Other growth in assets included a
$1.3 million increase in Federal Home Loan Bank stock and a $1.0 million
increase in cash and cash equivalents.
At March 31,2003, net loans reached $372.5 million from $359.9 million at
December 31, 2002. The increase in net loans was primarily attributable to the
growth of $8.4 million in real estate secured loan portfolio, including a $15.6
million increase in commercial real estate loans, offset by a $7.9 million
decrease in one-to-four family residential mortgages. Variable rate lines of
credit increased $3.6 million for the period ended March 31, 2003. The increase
in net loans is attributable to increased borrowings in the current historically
low interest rate environment.
At March 31, 2003, total liabilities increased $14.3 million, or 2.7%, to
$542.2 million from $527.9 million at December 31, 2002. This increase was
primarily the result of fixed-rate long-term and amortizing borrowings from the
Federal Home Loan Bank, which had a net increase of $13.9 million reaching $53.9
million at March 31, 2003 from $40.0 million at December 31,
5
2002. These low-rate advances were used to fund the growth in the loan
portfolio. Non-interest bearing deposits reached $78.5 million at March 31,
2003, from $74.3 million at December 31, 2002. Higher balances in deposit
accounts and an increase in the number of demand deposit accounts attributed to
the increase in non-interest bearing deposits. Interest-bearing deposits
declined to $389.7 million at March 31, 2003, from $393.9 million at December
31, 2002. The decrease of $4.3 million was primarily attributable to a $13.2
million decrease in certificate of deposit accounts resulting from expected
deposit reductions of local municipalities. The reduction in certificate of
deposit accounts was offset by increases of $4.4 million and $3.8 million in
money market and savings accounts, respectively.
At March 31, 2003, total stockholders' equity increased $1.2 million to
$57.4 million from $56.2 million at December 31, 2002. The increase was due to
net income of $2.6 million offset by a decrease of $400,000 in accumulated other
comprehensive income (net of income taxes), and dividends paid of $1.0 million.
Accumulated other comprehensive income decreased as a result of changes in the
net unrealized gain on securities available for sale. Because of interest rate
volatility, the Company's accumulated other comprehensive income could
materially fluctuate for each interim period and year-end. See Note D to the
consolidated financial statements.
RESULTS OF OPERATIONS
Net income. Net income for the three months ended March 31, 2003 increased
$200,000, or 8.3%, to $2.6 million from $2.4 million for the comparable three
month period in 2002. The increase for the three months ended March 31, 2003 was
the result of higher net interest income and other income partially offset by
increases in other expenses.
Interest income. Interest income for the three months ended March 31, 2003
increased $300,000 to $8.5 million from $8.2 million for the comparable three
month period in 2002. While the average balances of interest earning assets
increased $63.0 million for the three months ended March 31, 2003, to $593.3
million from $530.3 million for the comparable period in 2002, the yield on
these assets decreased 52 basis points to 6.02%, for the three months ended
March 31, 2003 from 6.54% for the comparable period in 2002. The reduction in
short term interest rates by the Federal Reserve contributed to the decline in
average yields in the three month period in 2003. See "Average Balance Sheet and
Rate/Volume Analysis."
Interest expense. Interest expense for the three months ended March 31,
2003 decreased $200,000 to $3.0 million from $3.2 million for the comparable
period in 2002. The decrease in interest expense was primarily attributed to a
56 basis point decrease in the average cost of funds to 2.59% for the three
months ended March 31, 2003 from 3.15% for the comparable period in 2002, offset
by a $52.7 million increase in the average balance of interest bearing
liabilities. The reduction of average cost of funds for the three month period
ended March 31, 2003 is reflective of the continued historically low interest
rates paid on deposits and borrowings over the past year. See "Average Balance
Sheet and Rate/Volume Analysis."
6
Average Balance Sheet
The following table sets forth certain information relating to the company for
the periods indicated. The average yields and costs are derived by dividing
income or expense on an annualized basis by the average balance of assets or
liabilities, respectively, for the periods presented. Average balances are
derived from average daily balances.
Three Months Ended March 31, Three Months Ended March 31,
--------------------------------- --------------------------------
2003 2002
--------------------------------- --------------------------------
Average Average Average Average
Balance Interest Yield/Cost Balance Interest Yield/Cost
-------- -------- ---------- ------- -------- ----------
(In Thousands) (In Thousands)
Interest-earning assets:
Loans receivable (1) $369,759 $ 6,437 6.96% $316,796 $ 5,891 7.44%
Investment securities available
for sale (2) 190,972 2,046 4.29% 175,655 2,275 5.18%
Other interest-earning assets (3) 3,545 10 1.13% 9,868 42 1.72%
Total interest earning assets $564,276 $ 8,493 6.02% $502,319 $ 8,208 6.54%
======== ======= ======== =======
Non-interest earning assets 29,065 28,030
-------- --------
Total assets $593,341 $530,349
======== ========
Interest-bearing liabilities:
Money market accounts 60,474 216 1.43% 57,895 299 2.07%
Certificates of Deposit 224,060 1,893 3.38% 198,258 2,018 4.07%
Other liabilities 174,767 864 1.98% 150,470 890 2.37%
-------- -------- -------- --------
Total interest-bearing liabilities $459,301 $ 2,973 2.59% $406,623 $ 3,207 3.15%
======== ==== ======== ====
Non-interest-bearing liabilities 77,373 73,276
-------- --------
Total liabilities $536,674 $479,899
======== ========
Retained Earnings (4) 56,667 50,450
-------- --------
Total liabilities and
stockholders' equity $593,341 $530,349
======== ========
Net interest income $ 5,520 $ 5,001
======== ========
Interest rate spread (5) 3.43% 3.39%
======= =======
Net yield on interest-earning assets (6) 3.91% 3.98%
======= =======
Ratio of average interest-earning
assets to average interest-bearing
liabilities 122.86% 123.53%
======= =======
(1) Average balances include non-accrual loans, and are net of deferred loan
fees.
(2) Includes interest-bearing deposits in other financial institutions.
(3) Consists of federal funds sold.
(4) Includes capital stock, surplus and accumulated other comprehensive income,
less treasury stock.
7
(5) Interest-rate spread represents the difference between the average yield on
interest-earning assets and the average cost of interest-bearing
liabilities.
(6) Net yield on interest-earning assets represents annualized net interest
income as a percentage of average interest earning assets.
Rate / Volume Analysis
The following table shows the effect of changes in volumes and rates on interest
income and interest expense. The changes in interest income and interest expense
attributable to changes in both volume and rate have been allocated to the
changes due to rate. Tax exempt income was not recalculated on a tax equivalent
basis due to the immateriality of the change to the table resulting from a
recalculation.
Three Month Period ended March 31, 2003
---------------------------------------
2003 vs. 2002
---------------------------------------
Increase (Decrease)
Due to
Volume Rate Net
------ ---- ---
(In Thousands)
Interest income:
Loans receivable 985 (439) 546
Investment securities available for sale 199 (427) (228)
Other interest earning assets (27) (5) (32)
Total interest-earning assets 1,157 (871) 286
===== ===== =====
Interest expense:
Money market accounts 13 (96) (83)
Certificates of deposit 263 (387) (124)
Other liabilities 144 (170) (26)
Total interest-bearing liabilities 420 (653) (233)
===== ===== =====
Net change in net interest income 737 (218) 519
===== ===== =====
Provision for loan losses. For the three months ended March 31, 2003 the
provision for loan losses was $150,000 compared to $250,000 for the comparable
2002 periods. The addition to the provision for loan losses for the three months
ended March 31, 2003 was to cover net losses of $59,000 in the period and the
$12.6 million increase in the loan portfolio.
The evaluation for determining the provision includes evaluations of
concentrations of credit, past loss experience, current economic conditions,
amount and composition of fair value of
8
underlying collateral, loan commitments outstanding, delinquencies, and other
information available at such time. The Company continues to monitor its
allowance for loan losses as economic conditions dictate. Management continues
to offer a wider variety of loan products coupled with the continued success of
changing the mix of the products offered in the loan portfolio from lower
yielding loans (i.e., one-to-four family loans) to higher yielding loans (i.e.,
equity loans, multi-family (five or more units) buildings, and commercial
(nonresidential mortgages).
Management periodically estimates the likely level of losses on loans to
determine whether the allowance for loan losses is adequate to absorb losses in
the existing portfolio for unidentified loans as well as classified loans. Based
on these estimates, a provision for loan losses is charged to operations in
order to adjust the allowance to a level determined to be adequate to absorb
anticipated future losses. The allowance is based on management's evaluation of
the collectibility of the loan portfolio, including the nature of the portfolio,
credit concentrations, trends in historical loss experience, specific impaired
loans, and economic conditions. Large groups of smaller balance homogenous loans
are valued collectively for impairment. The amount of loss reserve is calculated
using historical loss rates, net of recoveries, adjusted for environmental, and
other qualitative factors such as industry, geographical, economic and political
factors that can affect loss rates or loss measurements. Allowances for losses
on specifically identified loans that are determined to be impaired are
calculated based upon collateral value, market value, if determinable, or the
present value of estimated future cash flows. The allowance is increased by a
charge to operations, and reduced by charge-offs, net of recoveries.
The allowance for loan losses is maintained at a level that represents
management's best estimate of losses in the portfolio at the balance sheet date.
However, there can be no assurance that the allowance for loan losses will be
adequate to cover losses, which may be realized in the future, and that
additional provisions for losses on loans will not be required.
Other income. Total other income for the three months ended March 31, 2003
increased $100,000 to $1.4 million from $1.3 million for the comparable three
month period in 2002. The increase in other income for the three months ended
March 31, 2003 was primarily due to gains recognized from the sale of available
for sale securities of $225,000, an increase of $178,000 from the same period in
2002. Such increases were partially offset by a decrease in other income of
$70,000 to $491,000 at March 31, 2003 from $562,000 at March 31, 2002. Reflected
in other income at March 31, 2002 is $104,000 recorded as a gain on other real
estate sold.
Other expense. Total other expense for the three month period ended March
31, 2003 increased $400,000 to $3.2 million from $2.8 million for the comparable
three month period in 2002. Salaries and benefits increased $200,000 at March
31, 2003 from the comparable period in 2002 due to merit salary increases and
increased pension costs. Occupancy expense for the three months ended March 31,
2003 increased $61,000 to $377,000 from $316,000 for the comparable three month
period in 2002. Such increases at March 31, 2003 were predominantly due to
depreciation expense related to equipment purchases for technological
improvements and increased rental expense due to the relocation of the Company's
item processing department. Other expense for the period ended March 31, 2003
increased $132,000 to $995,000 from $863,000 for the
9
comparable three month period in 2002. Included in this increase is $46,000 in
costs associated with the Company's listing on the American Stock Exchange,
$30,000 in donations primarily contributed to Action Housing to support local
housing development, $11,000 in legal fees associated with the normal cost of
doing business, $10,000 in increased costs associated with customer relations,
and $10,000 in additional cost related to the Company's Pennsylvania shares tax.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There were no significant changes for the three months ended March 31, 2003
from the information presented in the 10K statement, under the caption Market
Risk, for the year ended December 31, 2002.
CONTROLS AND PROCEDURES
(a) Evaluation of disclosure controls and procedures Based on their evaluation
as of a date within 90 days of the filing of this Quarterly Report on Form
10-Q, the Registrant's principal executive officer and principal financial
officer have concluded that the Registrant's disclosure controls and
procedures (as defined in Rules 13a - 14(c) and 15d - 14(c) under the
Securities Exchange Act of 1934 (the "Exchange Act")) are effective to
ensure that information required to be disclosed by the Company in reports
that it files or submits under the Exchange Act is recorded, processed,
summarized and reported within the time periods specified in Securities and
Exchange Commission rules and forms.
(b) Changes in internal controls There were no significant changes in the
Registrant's internal controls or in other factors that could significantly
affect these controls subsequent to the date of their evaluation, including
any corrective actions with regard to significant deficiencies and material
weaknesses.
10
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The registrant is not engaged in any legal proceedings at the present
time. From time to time, the Bank is a party to legal proceedings
within the normal course of business wherein it enforces its security
interest in loans made by it, and other matters of a like kind.
Item 2. Changes in Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
The Annual Meeting of Shareholders of the Company was held on April
15, 2003 and the following matter was voted upon:
Proposal I - Election of directors with terms to expire in 2004
FOR WITHHELD
--- --------
Thomas Beter 2,435,593 20,316
Election of directors with terms to expire in 2006
FOR WITHHELD
--- --------
Richard J. Hoffman 2,435,717 20,192
Edwin A. Paulone 2,426,031 29,878
Proposal II - The ratification of Edwards, Sauer, & Owens as auditors
for the fiscal year ended December 31, 2003.
FOR AGAINST WITHHELD
--- ------- --------
2,436,093 788 19,028
11
Item 5. Other Information
Not applicable
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
3(i) Articles of Incorporation of IBT Bancorp, Inc.*
3(ii) Amended Bylaws of IBT Bancorp, Inc.**
10 Change In Control Severance Agreement with Charles G.
Urtin ***
10.1 Deferred Compensation Plan For Bank Directors***
10.2 Retirement Agreement Between Irwin Bank & Trust Co. And
J. Curt Gardner***
10.3 Death Benefit Only Deferred Compensation Plan For
Bank Directors effective as of January 1, 1990***
10.4 Retirement and Death Benefit Deferred Compensation Plan
For Bank Directors effective as of January 1, 1990***
10.5 2000 Stock Option Plan****
99.0 Certification Pursuant to 18 U.S.C. Section 1350, As
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002
-------------------------
* Incorporated by reference to the identically numbered
exhibits of the Registrant's Form 10 (file no. 0-25903)
** Incorporated by reference to the identically numbered
exhibit of the Registrants Form 10-K for December 31, 2002.
*** Incorporated by reference to the identically numbered
exhibits of the Registrant's Form 10K for December 31, 1999.
**** Incorporated by reference to the definitive proxy statement
of the registrant filed on March 17, 2000.
(b) Reports on Form 8-K
1) A Report on Form 8-K was filed on February 11, 2003 pursuant to items
5 and 7 announcing the operating results for the Fourth Quarter and
Year ended December 31, 2002.
2) A Report on Form 8-K was filed on March 26, 2003 pursuant to items 5
and 7 announcing the approval of the Registrant's application for
listing on the American Stock Exchange.
3) A Report on Form 8-K was filed on April 3, 2003 pursuant to items 5, 7
and 9 announcing the commencement of the Registrant's trading on the
American Stock Exchange.
4) A Report on Form 8-K was filed on April 17, 2003 pursuant to items 5
and 7 announcing the results of the Registrant's annual meeting of
shareholders and announcing the declaration of a second quarter cash
dividend.
12
5) A Report on Form 8-K was filed on April 28, 2003 pursuant to items 7
and 9 (in compliance with Release Number 34-47583) announcing the
Registrant's results of Operations for the quarter ended March 31,
2003.
13
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, thereunto duly authorized.
IBT BANCORP, INC.
Date: May 6, 2003 By: /s/ Charles G. Urtin
---------------------------------------
Charles G. Urtin
President, Chief Executive Officer
(Duly authorized officer)
Date: May 6, 2003 By: /s/ Raymond G. Suchta
---------------------------------------
Raymond G. Suchta
Vice President, Chief Financial Officer
(Duly authorized officer)
14
SECTION 302 CERTIFICATION
I, Charles G. Urtin, certify that:
1. I have reviewed this quarterly report on Form 10-Q of IBT Bancorp, Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
(a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly
report is being prepared;
(b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
(c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officer and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent functions):
(a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
(b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officer and I have indicated in this
quarterly report whether there were significant changes in internal
controls or in other factors that could significantly
affect internal controls subsequent to the date of our most recent
evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.
Date: May 6, 2003 /s/ Charles G. Urtin
-------------------------------------
Charles G. Urtin
Chief Executive Officer
SECTION 302 CERTIFICATION
I, Raymond G. Suchta, certify that:
1. I have reviewed this quarterly report on Form 10-Q of IBT Bancorp, Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
(a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly
report is being prepared;
(b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
(c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officer and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent functions):
(a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
(b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officer and I have indicated in this
quarterly report whether there were significant changes in internal
controls or in other factors that could significantly
affect internal controls subsequent to the date of our most recent
evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.
/s/ Raymond G. Suchta
-------------------------------------
Date: May 6, 2003 Raymond G. Suchta
Chief Financial Officer