SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2005
--------------
OR
[_] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________to__________
Commission File No. 0-24621
Farnsworth Bancorp, Inc.
- --------------------------------------------------------------------------------
(Exact name of Small Business Issuer as Specified in Its Charter)
New Jersey 22-3591051
- -------------------------------------------- ----------------
State or Other Jurisdiction of Incorporation (I.R.S. Employer
or Organization) Identification No.)
789 Farnsworth Avenue, Bordentown, New Jersey 08505
---------------------------------------------------
(Address of Principal Executive Offices)
(609) 298-0723
- --------------------------------------------------------------------------------
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
--- ---
Number of shares of Common Stock outstanding as of April 30, 2005: 650,311
Transitional Small Business Disclosure Format (check one)
YES NO X
--- ---
Contents
PART I - FINANCIAL INFORMATION Page(s)
-------
Item 1. Financial Statements
Consolidated Statements of Financial Condition at March 31, 2005
(unaudited) and September 30, 2004 (audited)..........................1
Consolidated Statements of Income and Comprehensive Income for the
three and six months ended March 31, 2005 and 2004 (unaudited)........2
Consolidated Statements of Cash Flows for the six months ended
March 31, 2005 and 2004 (unaudited)...................................3
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations..............................................5
Item 3. Controls and Procedures................................................9
PART II - OTHER INFORMATION
Item 1. Legal Proceedings....................................................10
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds..........10
Item 3. Defaults upon Senior Securities......................................10
Item 4. Submission of Matters to a Vote of Security Holders..................10
Item 5. Other Information....................................................10
Item 6. Exhibits.............................................................10
Signatures....................................................................11
Certifications................................................................12
FARNSWORTH BANCORP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
MARCH 31, SEPTEMBER 30,
2005 2004
------------- -------------
ASSETS (UNAUDITED) (AUDITED)
Cash and due from banks $ 6,046,567 $ 6,009,330
Securities available for sale 20,118,758 19,288,779
Securities held to maturity 1,488,232 261,301
Loans receivable, net 68,826,848 66,502,369
Accrued interest receivable 435,697 448,194
Federal Home Loan Bank of New York (FHLB) stock
at cost substantially restricted 490,200 490,200
Deferred income taxes 412,716 137,719
Premises and equipment 2,254,219 2,340,641
Other assets 132,830 126,650
------------- -------------
Total assets $ 100,206,067 $ 95,605,183
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits $ 89,701,093 $ 86,825,805
Borrowings from FHLB 733,499 810,013
Advances by borrowers for taxes and insurance 455,609 373,531
Accrued income taxes 150,992 123,102
Accrued interest payable 72,331 63,219
Accounts payable and other accrued
expenses 103,827 146,039
------------- -------------
Total liabilities 91,217,351 88,341,709
------------- -------------
Preferred stock $.10 par value, 1,000,000
shares authorized; none issued and
outstanding
Common stock $.10 par value, 5,000,000 shares authorized;
662,693 and 542,666 shares issued, at March 31, 2005
and September 30, 2004 respectively; shares outstanding
650,311 and 530,284 for 2005 and 2004, respectively 66,270 54,267
Additional paid in capital 8,481,669 6,515,350
Retained earnings substantially restricted 1,252,821 1,068,643
Treasury stock at cost 12,382 shares (120,658) (120,658)
Common stock aquired by
employee stock ownership plan (ESOP) (263,826) (113,694)
Common stock aquired by restricted stock plan (42,231) (55,100)
Accumulated other comprehensive income , unrealized
depreciation on available for sale securities,
net of taxes (385,329) (85,334)
------------- -------------
Total stockholders' equity 8,988,716 7,263,474
------------- -------------
Total liabilities and
stockholders' equity $ 100,206,067 $ 95,605,183
============= =============
SEE NOTES TO FINANCIAL STATEMENTS
1
FARNSWORTH BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME
(Unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED
MARCH 31 MARCH 31
2005 2004 2005 2004
----------- ----------- ----------- -----------
Interest income:
Loans receivable $ 1,146,285 $ 1,127,415 $ 2,289,906 $ 2,208,788
Securities 217,362 189,116 423,405 383,073
Federal funds sold 34,948 14,566 69,977 29,385
----------- ----------- ----------- -----------
Total interest income 1,398,595 1,331,097 2,783,288 2,621,246
----------- ----------- ----------- -----------
Interest expense:
Deposits 446,646 366,898 872,951 733,889
Federal Home Loan Bank advances 11,031 13,250 22,630 27,534
----------- ----------- ----------- -----------
Total interest expense 457,677 380,148 895,581 761,423
----------- ----------- ----------- -----------
Net interest income 940,918 950,949 1,887,707 1,859,823
Provision for loan losses 43,289 63,000 66,891 83,000
----------- ----------- ----------- -----------
Net interest income after
provision for loan losses 897,629 887,949 1,820,816 1,776,823
----------- ----------- ----------- -----------
Noninterest income:
Fees and other service charges 68,171 83,553 145,622 149,379
Net realized gain on available for sale:
Loans 4,222 11,514 11,759 19,967
Securities 5,091 28,022 8,308 47,609
----------- ----------- ----------- -----------
Total noninterest income 77,484 123,089 165,689 216,955
----------- ----------- ----------- -----------
Noninterest expense:
Compensation and benefits 429,577 426,490 898,615 885,259
Occupancy and equipment 143,611 129,634 275,681 252,377
Professional fees 56,347 38,175 111,172 91,124
Servive fees 45,768 40,577 87,719 84,682
Other 132,540 135,041 251,825 256,715
----------- ----------- ----------- -----------
Total noninterest expense 807,843 769,917 1,625,012 1,570,157
----------- ----------- ----------- -----------
Income before provision for income
tax expense 167,270 241,121 361,493 423,621
Provision for income tax expense 63,000 91,700 144,800 164,700
----------- ----------- ----------- -----------
Net income 104,270 149,421 216,693 258,921
Other Comprehensive Income, net of taxes
Unrealized gain (loss) on Securities
Available for Sale (195,384) 177,569 (295,010) 119,691
Reclassification adjustments for gains
included in net income (3,055) (16,813) (4,985) (28,600)
----------- ----------- ----------- -----------
Comprehensive (loss) income $ (94,169) $ 310,177 $ (83,302) $ 350,012
=========== =========== =========== ===========
Net income per common share:
Basic $ 0.17 $ 0.31 $ 0.36 $ 0.53
Diluted $ 0.16 $ 0.28 $ 0.34 $ 0.49
Weighted average number of shares
outstanding during the period:
basic 621,317 486,761 598,235 486,761
diluted 658,918 535,082 628,288 527,721
SEE NOTES TO FINANCIAL STATEMENTS
2
FARNSWORTH BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
SIX MONTHS ENDED MARCH 31
2005 2004
------------ ------------
Cash flows from operating activities:
Net income $ 216,693 $ 258,921
------------ ------------
Adjustments to reconcile net income
to net cash provided by operating activities
Depreciation and amortization 96,044 75,974
Stock compensation 55,368 40,740
Provision for loan losses 66,891 83,000
Net gain on sale of AFS securities (8,308) (47,609)
Net gain loans sold (11,759) (19,967)
Change in:
Accrued interest receivable 12,497 (39,105)
Other assets (6,180) 3,421
Advances from borrowers 82,078 55,659
Accrued and deferred income taxes (47,110) (72,920)
Accrued interest payable 5,498 3,590
Other accrued liabilities (38,597) (37,949)
------------ ------------
Total adjustments 206,422 44,834
------------ ------------
Net cash provided by operating
activities 423,115 303,755
------------ ------------
Cash flows from investing activities:
Net increase in loans receivable (2,391,370) (3,799,232)
Redemption of securities, held to maturity 24,457 115,153
Redemption of securities, available for sale 1,735,667 558,123
Purchase of securities, held to maturity (1,251,688) -
Proceeds from sale of securities available for sale 7,391,157 6,716,257
Purchase of securities, available for sale net (10,436,429) (8,946,843)
Purchase of premises and equipment (9,622) (111,614)
------------ ------------
Net cash used in investing
activities (4,937,828) (5,468,156)
------------ ------------
Cash flows from financing activities:
Net increase in deposits 2,875,288 3,928,242
Repayment of Federal Home Loan Bank Borrowings (76,514) (72,132)
Proceeds from sale of stock, net 1,785,691
Dividends paid (32,515) (21,652)
------------ ------------
Net cash provided by financing
activities 4,551,950 3,834,458
------------ ------------
Net change in cash 37,237 (1,329,943)
Cash at beginning of period 6,009,330 11,539,886
------------ ------------
Cash at end of period $ 6,046,567 $ 10,209,943
============ ============
Supplemental disclosure:
Cash paid during the period for:
Interest $ 890,083 $ 757,833
============ ============
Income taxes $ 135,000 $ 241,250
============ ============
Non cash items
Stock dividend $ - $ 1,750,589
============ ============
Common stock aquired by Restricted Stock Plan $ 20,131 $ 132,200
============ ============
Treasury Stock $ - $ (64,514)
============ ============
Additional paid in capital $ - $ (67,686)
============ ============
Unrealized (loss) gain on securities available
for sale, net of deferred income taxes $ (299,995) $ 91,091
============ ============
Loan to ESOP $ 172,500
============
SEE NOTES TO FINANCIAL STATEMENTS
3
FARNSWORTH BANCORP, INC. AND SUBSIDIARY
NOTES TO UNAUDITED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
NOTE 1. Presentation of Financial Information
-------------------------------------
The accompanying unaudited consolidated interim financial statements
include the accounts of Farnsworth Bancorp, Inc. (the "Company") and its
subsidiaries Peoples Savings Bank (the "Bank") and Peoples Financial Services,
Inc. The accompanying unaudited consolidated interim financial statements have
been prepared in accordance with the instructions to Form 10-QSB. Accordingly,
they do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. The accounting
and reporting policies of the Company conform in all material respects to
generally accepted accounting principles and to general practice within the
thrift industry. It is the opinion of management that the accompanying unaudited
consolidated interim financial statements reflect all adjustments, which are
considered necessary to report fairly the financial position as of March 31,
2005, the Consolidated Statements of Income and Comprehensive Income for the
three and six months ended March 31, 2005 and 2004, and the Consolidated
Statements of Cash Flows for the six months ended March 31, 2005 and 2004. The
results of operations for the three and six months ended March 31, 2005 are not
necessarily indicative of results that may be expected for the entire year
ending September 30, 2005, or for any other period. The accompanying unaudited
consolidated interim financial statements should be read in conjunction with the
Company's September 30, 2004 consolidated financial statements, including the
notes thereto, which are included in the Company's Annual Report on Form 10-KSB
for the fiscal year ended September 30, 2004.
In preparing the financial statements, management is required to make
estimates and assumptions that affect the reported amount of assets and
liabilities, the disclosure of contingent assets and liabilities and the
reported revenues and expenses. Actual results could differ significantly from
those estimates. In addition, various regulatory agencies, as an integral part
of their examination process, periodically review the Bank's allowance for loan
losses and foreclosed real estate. Such agencies may require the Bank to
recognize additions to the allowance for loan losses or additional write-downs
on foreclosed real estate based on their judgments about information available
to them at the time of their examination.
The Board of Directors declared a 20% stock dividend in the quarter
ended March 31, 2004. Basic and diluted earnings per share have been restated
for all periods presented to reflect the stock dividend.
On November 5, 2004, the Company completed the private offering (the
"Offering") of 120,027 shares of its common stock, par value $.10 per share, for
an aggregate sales price of $2,070,466 ($17.25 per share). The Company did not
use an underwriter in connection with the Offering. The Offering was not
registered with the Securities and Exchange Commission ("SEC") under the
Securities Act of 1933, as amended (the "Securities Act"), pursuant to an
exemption from registration under Rule 505 of Regulation D promulgated under the
Securities Act. The Offering qualified for the exemption from registration under
Rule 505 of Regulation D in that the aggregate offering price was less than $5
million, there were fewer than 35 "unaccredited investors" who actually
purchased stock in the Offering and the Company has satisfied the other
applicable terms and conditions of Rules 501, 502 and 503 of Regulation D.
Nature of Operations
- --------------------
The Company is a unitary savings and loan holding company. The Bank
operates four branches in Burlington County, New Jersey. The Bank offers
customary banking services, including accepting checking, savings and time
deposits and the making of commercial, real-estate and consumer loans, to
customers who are predominantly small and middle-market businesses and
middle-income individuals.
4
The Company also offers brokerage, investment advisory services and
insurance services to the general public through Peoples Financial Services,
Inc., a subsidiary organized for the sale of mutual funds and insurance through
a third party networking agreement.
..
NOTE 2. Net Income Per Common Share
---------------------------
Basic net income per common share is calculated by dividing net income by the
number of shares of common stock outstanding, adjusted for the unallocated
portion of shares held by the Banks's Employee Stock Ownership Plan ("ESOP") and
the Bank's Restricted Stock Plan ("RSP"). Diluted net income per share is
calculated by adjusting the number of shares of common stock outstanding to
include the effect of stock options, stock-based compensation grants and other
securities, if dilutive generally using the treasury stock method.
For the three months ended March 31
-----------------------------------
2005 2004
Weighted Per Weighted Per
Average Share Average Share
Income Shares Amount Income Shares Amount
------ ------ ------ ------ ------ ------
Net income available
to common shareholders $104,270 650,311 $ 149,421 520,959
ESOP shares, not
committed to be released (27,508) (21,805)
RSP shares (1,486) (12,393)
---------------------------- ----------------------------
Basic earnings per share 104,270 621,317 $0.17 $149,421 486,761 $ 0.31
Common stock equivalents 37,601 48,321
---------------------------- ----------------------------
Diluted earnings per share $104,270 658,918 $0.16 $149,421 535,082 $ 0.28
======== ======= ===== ======== ======= ======
NOTE 3. Investment Securities
---------------------
The Bank's investments in securities are classified in two categories and
accounted for as follows:
Securities Held to Maturity. Mortgage-backed securities for which the Bank has
the positive intent and ability to hold to maturity are reported at cost,
adjusted for amortization of premiums and accretion of discounts which are
recognized in interest income using the interest method over the period to
maturity.
Securities Available for Sale. Securities available for sale are reported at
market value and consist of certain debt and equity securities not classified as
trading or securities to be held to maturity.
5
Declines in the fair value of individual held to maturity and available for sale
securities below their cost that are other than temporary will result in
write-downs of the individual securities to their fair value. The related
write-downs will be included in earnings as realized losses.
Unrealized holding gains and losses, net of tax, on securities available for
sale are reported as a net amount in a separate component of equity until
realized.
Gains and losses on the sale of securities available for sale are determined
using the specific-identification method.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The Company may from time to time make written or oral "forward-looking
statements, " including statements contained in the Company's filings with the
Securities and Exchange Commission (including this Quarterly Report of Form
10-QSB), in its reports to stockholders and in other communications by the
Company, which are made in good faith by the Company pursuant to the "safe
harbor" provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements involve risks and uncertainties, such
as statements of the Company's plans, objectives, expectations, estimates and
intentions, that are subject to change based on various important factors (some
of which are beyond the Company's control). The following factors, among others,
could cause the Company's financial performance to differ materially from the
plans, objectives, expectations, estimates and intentions expressed in such
forward-looking statements: the strength of the United States economy in general
and the strength of the local economy in which the Company conducts operations;
the effects of, and changes in, trade, monetary and fiscal policies and laws,
including interest rate policies of the board of governors of the federal
reserve system, inflation, interest rate, market and monetary fluctuations; the
impact of changes in financial services' laws and regulations (including laws
concerning taxes, banking securities and insurance); technological changes; and
the success of the Company at managing the risks involved in the foregoing.
The Company cautions that the foregoing list of important factors is
not exclusive. The Company does not undertake to update any forward-looking
statement, whether written or oral, that may be made from time to time by or on
behalf of the Company.
Financial Condition
Total assets increased $4.6 million or 4.8% to $100.2 million at March
31, 2005 from $95.6 million at September 30, 2004. The increase was primarily
attributable to a $2.1 million increase in the Bank's available for sale and
held to maturity securities purchased in order to supplement lending and an
increase of $2.3 million in loans receivable net primarily due to an increase in
the commercial real estate portfolio. The Bank's total liabilities increased
$2.9 million or 3.2%, to $91.2 million at March 31, 2004 from $88.3 million at
September 30, 2004. The increase in total liabilities was primarily attributable
to a $2.9 million increase in deposits, due to an increase in advertising.
Stockholders' equity increased $1.7 million to $9.0 million or 8.9% of
total assets at March 31, 2005 as compared to $7.3 million or 7.6% of total
assets at September 30, 2004. The increase in stockholders' equity is primarily
attributed to the sale of $2.1 million of common stock in the Offering, and net
income of $217,000, partially offset by addition of ESOP and RSP shares acquired
of $193,000, a change in the unrealized depreciation on available for sale
securities net of taxes of $300,000 and dividends paid of $33,000.
6
Results of Operations
Net Income. The Company's net income decreased $45,000 for the quarter
ended March 31, 2005 to $104,000 from $149,000 for the quarter ended March 31,
2004. The decrease in net income was attributable to a decrease in non-interest
income of $46,000 and an increase in non-interest expense of $38,000 partially
offset by an increase in net interest income after provisions for loan losses of
$10,000 and a decrease in provision for income taxes of $29,000. For the six
months ended March 31, 2005, net income decreased $42,000 to $217,000 from net
income of $259,000 for the same period in 2004.
Net Interest Income. Net interest income is the most significant
component of the Bank's income from operations. Net interest income is the
difference between interest the Bank received on its interest earning assets,
primarily loans, investments and mortgage-backed securities, and interest the
Bank pays on its interest-bearing liabilities, primarily deposits and
borrowings. Net interest income depends on the volume of and rates earned on
interest-earning assets and the volume of and rates paid on interest-bearing
liabilities.
Net interest income after provision for loan losses increased $10,000
or 1.1%, to $898,000 for the quarter ended March 31, 2005 as compared to
$888,000 for the quarter ended March 31, 2004. The increase resulted from an
increase in interest income of $68,000 and a decrease in the provision for loan
losses of $20,000 partially offset by an increase in interest expense of
$78,000. Net interest income after provision for loan losses increased $44,000
for the six months ended March 31, 2005 compared to the same period in 2004.
Provision for Loan Losses. Provision for loan losses was $43,000 for
the three months ended March 31, 2005 compared to $63,000 for the three months
ended March 31, 2004. The decrease reflects management's assessment of the
credit risks in the loan portfolio and the level of charge-offs and
non-performing loans. For the six months ended March 31, 2005 the provision for
loan losses was $67,000 compared to $83,000 for the same period in 2004.
Management believes the allowance for loan losses is at a level that is
adequate to provide for estimated losses. However, there can be no assurance
that further additions will not be made to the allowance or that such losses
will not exceed the estimated amount.
Non-Interest Income. Non-interest income decreased $46,000 or 37.0% to
$77,000 for the quarter ended March 31, 2005 from $123,000 for the same quarter
in 2004. This decrease was partially due to a decrease in fees and other charges
of $16,000 and a decrease in sale of securities and loans available for sale of
$31,000 compared to the same period in 2004. For the six months ended March 31,
2005, non-interest income decreased $51,000 compared to the same period in 2004.
Non-Interest Expense. Non-interest expense increased by $38,000 to
$808,000 for the quarter ended March 31, 2005, compared to $770,000 for the
quarter ended March 31, 2004. The increase was primarily due to an increase in
office occupancy and equipment expenses of $14,000, professional fees of $18,000
and service fees of $5,000. For the six months ended March 31, 2005 non-interest
expense increased by $55,000 compared to the same period in 2004. The increase
in the six months was due to an increase of $23,000 in office occupancy and
equipment and an increase of $20,000 in professional fees.
Income Tax Expense. Income tax expense decreased by $29,000 to $63,000
for the quarter ended March 31, 2005 compared to $92,000 for the quarter ended
March 31, 2004. The decrease was attributable to the decrease in pretax income
of $74,000. For the six months ended March 31, 2005, income tax expense
decreased by $20,000 due to the decrease in pretax income.
7
Liquidity and Capital Resources
The Bank is required to maintain levels of liquid assets considered
necessary for its safe and sound operations.
The Bank's primary sources of funds are deposits, repayment of loans
and mortgage-backed securities, maturities of investment securities and
interest-bearing deposits with other banks, advances from the FHLB of New York
and funds provided from operations. While scheduled repayments of loans and
mortgage-backed securities and maturities of investment securities are
predictable sources of funds, deposit flows and loan prepayments are greatly
influenced by the general level of interest rates, economic conditions and
competition. The Bank uses its liquidity resources principally to fund existing
and future loan commitments, maturing certificates of deposit and demand deposit
withdrawals, to invest in other interest-earning assets, to maintain liquidity
and meet operating expenses.
Net cash provided by the Bank's operating activities (the cash effects
of transactions that enter into the Bank's determination of net income e.g.,
non-cash items, amortization and depreciation, provision for loan losses) for
the six months ended March 31, 2005 was $423,000, an increase of $119,000,
compared to the same period in 2004. The increase in 2005 was primarily due to
the change in gain on sale of securities and loans of $48,000 and accrued
interest receivable of $51,000, partially offset by a decrease in net income of
$42,000.
Net cash used by the Bank's investing activities (i.e., cash
disbursements, primarily for the purchase of investment securities and
mortgage-backed securities and for the funding of loans) for the six months
ended March 31, 2005 totaled $4.9 million compared to $5.5 million for the same
period in 2004. The use of funds is mainly attributable to an increase in loans
receivable, net of $2.4 million and an increase in investments of $2.5 million
of offering expenses.
Net cash provided the Bank's financing activities (i.e., cash receipts
primarily from net increases in deposits and net increases in FHLB advances) for
the six months ended March 31, 2005, totaled $4.6 million, compared to net cash
provided by financing activities of $3.8 million for the same period in 2004.
The increase is mainly attributable to proceeds from the sale of common stock of
$1.8 million net.
Office of Thrift Supervision ("OTS") capital regulations applicable to
the Bank require savings institutions to meet three capital standards: (1)
tangible capital equal to 1.5% of total adjusted assets, (2) a leverage ratio
(core capital) equal to at least 3% of total adjusted assets, and (3) a
risk-based capital requirement equal to 8.0% of total risk-weighted assets. In
addition, the OTS prompt corrective action regulation provides that a savings
institution that has a leverage capital ratio of less than 4% (3% for
institutions receiving the highest examination rating) will be deemed to be
"undercapitalized" and may be subject to certain restrictions. The Bank was in
compliance with these requirements at March 31, 2005, with tangible, core and
risk based capital ratios of 7.93%, 7.93% and 14.16%, respectively.
8
Item 3. Controls and Procedures
(a) Evaluation of disclosure controls and procedures. Based on their
-------------------------------------------------
evaluation of the Company's disclosure controls and procedures (as defined in
Rule 13a-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act")),
the Company's principal executive officer and principal financial officer have
concluded that as of the end of the period covered by this Quarterly Report on
Form 10-QSB such disclosure controls and procedures 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 control over financial reporting. During the
------------------------------------------------------
quarter under report, there was no change in the Company's internal control over
financial reporting that has materially affected, or is reasonably likely to
materially affect, the Company's internal control over financial reporting.
9
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
-----------------
The Company was not engaged in any material legal proceedings during
the quarter ended March 31, 2005. From time to time, the Company is a
party to legal proceedings within the normal course of business wherein
it enforces its security interests in loans made by it, and other
similar matters.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
-----------------------------------------------------------
Not applicable.
Item 3. Defaults Upon Senior Securities
-------------------------------
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
The annual meeting of stockholders of the Company was held on February
22, 2005, and the following matters were voted on by stockholders:
Election of Directors by a majority of votes
--------------------------------------------
John J. Maley
Coby M. Frier
George G. Aaronson, Jr.
Joseph H. Kelly
G. Edward Koenig, Jr.
Ratification of the Appointment of Auditor
------------------------------------------
Kronick, Kalada, Berdy & Co.
Item 5. Other Information
-----------------
Not applicable.
Item 6. Exhibits
--------
(a) Exhibits:
31 Certifications pursuant to section 302 of Sarbanes-Oxley Act of
2002
32 Certification pursuant to 18 U.S.C. ss.1350.
10
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
FARNSWORTH BANCORP, INC.
Date: May 6, 2005 By: /s/Gary N. Pelehaty
--------------------------------------------
Gary N. Pelehaty
President and Chief Executive Officer
(Principal Executive Officer)
(Duly Authorized Officer)
Date: May 6, 2005 By: /s/Charles Alessi
--------------------------------------------
Charles Alessi
Vice President, Chief Financial Officer
Secretary and Treasurer
(Principal Financial and Accounting Officer)
11