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 September 30, 2001
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 0-20006
ANCHOR BANCORP WISCONSIN INC.
-----------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Wisconsin 39-1726871
--------- ----------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
25 West Main Street
Madison, Wisconsin 53703
------------------ -----
(Address of principal executive office) (Zip Code)
(608) 252-8700
------------------------------
Registrant's telephone number, including area code
Not Applicable
------------------------------
(Former name, former address, and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (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 [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class: Common stock -- $.10 par value
Number of shares outstanding as of October 31, 2001: 22,182,253
ANCHOR BANCORP WISCONSIN INC.
INDEX - FORM 10-Q
PAGE #
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PART I - FINANCIAL INFORMATION
Item 1 Financial Statements (Unaudited)
Consolidated Balance Sheets as of September 30, 2001
and March 31, 2001 2
Consolidated Statements of Income for the Three and Six
Months Ended September 30, 2001 and 2000 3
Consolidated Statements of Cash Flows for the Six Months
Ended September 30, 2001 and 2000 4
Notes to Unaudited Consolidated Financial Statements 6
Item 2 Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations 10
Financial Condition 15
Asset Quality 16
Liquidity & Capital Resources 18
Asset/Liability Management 20
Item 3 Quantitative and Qualitative Disclosures About Market Risk 21
PART II - OTHER INFORMATION
Item 1 Legal Proceedings 21
Item 2 Changes in Securities 21
Item 3 Defaults upon Senior Securities 21
Item 4 Submission of Matters to Vote of Security Holders 21
Item 5 Other Information 21
Item 6 Exhibits and Reports on Form 8-K 21
SIGNATURES 22
1
CONSOLIDATED BALANCE SHEETS
(Unaudited)
SEPTEMBER 30, MARCH 31,
2001 2001
----------------------------------
(In Thousands, Except Share Data)
ASSETS
Cash $ 53,338 $ 58,481
Interest-bearing deposits 39,008 46,561
----------- -----------
Cash and cash equivalents 92,346 105,042
Investment securities available for sale 95,997 22,216
Investment securities held to maturity (fair value of $11,846 and
$34,096, respectively) 11,572 33,913
Mortgage-related securities available for sale 130,869 173,968
Mortgage-related securities held to maturity (fair value of $183,380
and $207,669, respectively) 178,413 205,191
Loans receivable, net:
Held for sale 26,985 17,622
Held for investment 2,412,666 2,414,976
Foreclosed properties and repossessed assets, net 1,716 313
Real estate held for development and sale 43,683 48,658
Office properties and equipment 25,783 25,734
Federal Home Loan Bank stock--at cost 39,266 37,985
Accrued interest on investments and loans 19,797 20,862
Prepaid expenses and other assets 19,085 20,994
----------- -----------
Total assets $ 3,098,178 $ 3,127,474
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits $ 2,222,236 $ 2,119,320
Federal Home Loan Bank and other borrowings 586,875 712,650
Reverse repurchase agreements 12,635 27,948
Advance payments by borrowers for taxes and insurance 19,858 7,918
Other liabilities 34,541 40,026
----------- -----------
Total liabilities 2,876,145 2,907,862
----------- -----------
Preferred stock, $.10 par value, 5,000,000 shares
authorized, none outstanding -- --
Common stock, $.10 par value, 100,000,000 shares authorized,
25,363,339 shares issued, 22,174,721 and 22,814,923 shares outstanding,
respectively 2,536 2,536
Additional paid-in capital 56,697 56,571
Retained earnings 209,247 197,599
Accumulated other comprehensive income 2,919 1,954
Treasury stock (3,188,618 shares and 2,548,416 shares,
respectively), at cost (49,424) (38,339)
Common stock purchased by benefit plans 58 (709)
----------- -----------
Total stockholders' equity 222,033 219,612
----------- -----------
Total liabilities and stockholders' equity $ 3,098,178 $ 3,127,474
=========== ===========
See accompanying Notes to Consolidated Financial Statements.
2
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
----------------------------- -----------------------------
2001 2000 2001 2000
-------- -------- -------- ---------
(In Thousands, Except Per Share Data)
INTEREST INCOME:
Loans $ 48,597 $ 49,893 $ 97,547 $ 97,205
Mortgage-related securities 5,044 4,571 10,754 9,317
Investment securities 1,732 2,190 3,194 4,127
Interest-bearing deposits 473 316 1,075 695
-------- -------- -------- ---------
Total interest income 55,846 56,970 112,570 111,344
INTEREST EXPENSE:
Deposits 23,997 23,448 48,897 45,306
Notes payable and other borrowings 8,827 13,508 19,320 25,344
Other 168 171 276 278
-------- -------- -------- ---------
Total interest expense 32,992 37,127 68,493 70,928
-------- -------- -------- ---------
Net interest income 22,854 19,843 44,077 40,416
Provision for loan losses 550 160 760 345
-------- -------- -------- ---------
Net interest income after provision for loan losses 22,304 19,683 43,317 40,071
NON-INTEREST INCOME:
Loan servicing income 619 625 534 1,237
Service charges on deposits 1,604 1,438 3,163 2,838
Insurance commissions 412 483 737 1,008
Gain on sale of loans 1,624 1,208 3,315 1,568
Net gain on sale of investments and mortgage-related securities 277 82 831 82
Net income (loss) from operations of real estate investments (133) (679) 26 (614)
Other 704 400 1,521 816
-------- -------- -------- ---------
Total non-interest income 5,107 3,557 10,127 6,935
NON-INTEREST EXPENSE:
Compensation 8,138 6,921 15,801 14,115
Occupancy 1,141 1,106 2,192 2,087
Furniture and equipment 1,102 1,009 2,123 1,956
Data processing 1,030 995 2,132 1,860
Marketing 618 609 1,232 1,218
Federal insurance premiums 99 97 198 192
Other 2,265 2,100 4,412 4,104
-------- -------- -------- ---------
Total non-interest expense 14,393 12,837 28,090 25,532
-------- -------- -------- ---------
Income before income taxes 13,018 10,403 25,354 21,474
Income taxes 4,779 3,822 9,204 7,908
-------- -------- -------- ---------
Net income $ 8,239 $ 6,581 $ 16,150 $ 13,566
======== ======== ======== =========
Earnings per share:
Basic $ 0.38 $ 0.29 $ 0.73 $ 0.59
Diluted 0.37 0.28 0.71 0.58
Dividends declared per share 0.08 0.08 0.16 0.15
See accompanying Notes to Unaudited Consolidated Financial Statements.
3
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED SEPTEMBER 30,
----------------------------
2001 2000
----------------------------
(In Thousands)
OPERATING ACTIVITIES
Net income $ 16,150 $ 13,566
Adjustments to reconcile net income to net
cash provided (used) by operating activities:
Provision for loan losses 760 345
Provision for depreciation and amortization 1,420 956
Net gain on sales of loans (3,315) (1,568)
Decrease (increase) in accrued interest receivable 1,065 (1,001)
(Decrease) increase in accrued interest payable (2,705) 2,421
(Decrease) increase in accounts payable (4,196) 2,227
Other (8,155) 14,364
--------- ---------
Net cash provided by operating activities before net proceeds
from loan sales 1,024 31,310
Net decrease due to origination and sale of loans held for sale (9,363) (3,744)
--------- ---------
Net cash (used) provided by operating activities (8,339) 27,566
INVESTING ACTIVITIES
Proceeds from sales of investment securities available for sale 1,745 3,685
Proceeds from maturities of investment securities 200,024 10,499
Purchase of investment securities available for sale (251,463) (43,559)
Proceeds from sale of mortgage-related securities available for sale 21,424 4,071
Purchase of mortgage-related securities available for sale (1,475) (1,485)
Principal collected on mortgage-related securities 50,798 24,593
Loans originated for investment (366,028) (385,710)
Principal repayments on loans 388,695 211,184
Net office properties and equipment (1,409) (248)
Sales of real estate -- 312
Investment in real estate held for development and sale (4,975) (14,752)
--------- ---------
Net cash provided (used) by investing activities 37,336 (191,410)
4
CONSOLIDATED STATEMENTS OF CASH FLOWS (Cont'd)
SIX MONTHS ENDED SEPTEMBER 30,
-----------------------------
2001 2000
-----------------------------
(In Thousands)
FINANCING ACTIVITIES
Increase in deposit accounts $ 102,916 $ 93,792
Increase in advance payments by borrowers
for taxes and insurance 11,940 15,558
Proceeds from notes payable to Federal Home Loan Bank 380,300 594,900
Repayment of notes payable to Federal Home Loan Bank (508,500) (544,500)
(Decrease) increase in securities sold under agreements
to repurchase (15,313) 8,506
Increase in other loans payable 2,425 22,315
Treasury stock purchased (13,743) (19,634)
Exercise of stock options 1,781 497
Purchase of stock by retirement plans 73 942
Payments of cash dividends to stockholders (3,572) (3,419)
--------- ---------
Net cash provided (used) by financing activities (41,693) 168,957
--------- ---------
Net increase (decrease) in cash and cash equivalents (12,696) 5,113
Cash and cash equivalents at beginning of period 105,042 83,708
--------- ---------
Cash and cash equivalents at end of period $ 92,346 $ 88,821
========= =========
SUPPLEMENTARY CASH FLOW INFORMATION: Cash paid or credited to accounts:
Interest on deposits and borrowings $ 67,203 $ 73,349
Income taxes 8,519 7,783
See accompanying Notes to Unaudited Consolidated Financial Statements
5
ANCHOR BANCORP WISCONSIN INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - PRINCIPLES OF CONSOLIDATION
The unaudited consolidated financial statements include the accounts and results
of operations of Anchor BanCorp Wisconsin Inc. (the "Corporation") and its
wholly-owned subsidiaries, AnchorBank fsb (the "Bank"), Investment Directions,
Inc. ("IDI") Nevada Investment Directions, Inc. ("NIDI") and California
Investment Directions, Inc. ("CIDI"). The Bank's accounts and results of
operations include its wholly-owned subsidiaries, Anchor Investment Services,
Inc. ("AIS"), ADPC Corporation ("ADPC"), and Anchor Investment Corporation
("AIC"). All significant intercompany balances and transactions have been
eliminated. Investments in joint ventures and other less than 50% owned
partnerships, which are not material, are accounted for by the equity method.
Partnerships with 50% ownership or more are consolidated, with significant
intercompany accounts eliminated.
NOTE 2 - BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles ("GAAP") and with
the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly,
they do not include all of the information and footnotes required by GAAP for
complete financial statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) necessary for a fair presentation of
the consolidated financial statements have been included.
In preparing the unaudited consolidated financial statements in conformity with
GAAP, management is required to make estimates and assumptions that affect the
amounts reported in the consolidated financial statements and accompanying
notes. Actual results could differ from those estimates. The results of
operations and other data for the six-month period ended September 30, 2001 are
not necessarily indicative of results that may be expected for any other interim
period or the entire fiscal year ending March 31, 2002. The unaudited
consolidated financial statements presented herein should be read in conjunction
with the audited consolidated financial statements and related notes thereto
included in the Corporation's Annual Report for the year ended March 31, 2001.
Unrealized gains or losses on the Corporation's available-for-sale securities
are included in other comprehensive income. During the quarter ended September
30, 2001 and 2000, total comprehensive income amounted to $8.6 million and $7.3
million, respectively. For the six months ended September 30, 2001 and 2000,
comprehensive income was $17.1 million and $14.1 million, respectively.
NEW ACCOUNTING STANDARDS On June 29, 2001, the Financial Accounting Standards
Board ("FASB") approved the issuance of Statement of Financial Accounting
Standards No. 141, "Business Combinations" (Statement 141). Statement 141
eliminates the pooling-of-interest method of accounting for business
combinations, except for qualifying business combinations that were initiated
prior to July 1, 2001. Statement 141 changes the criteria to recognize
intangible assets separate from goodwill. The requirements of FAS 141 are
effective for any business combination accounted for by the purchase method that
is completed after June 30, 2001.
On June 29, 2001, the FASB approved the issuance of Statement of Financial
Accounting Standards No. 142, "Goodwill and Other Intangible Assets" (Statement
142). Statement 142 supersedes certain provisions of APB Opinion No. 17,
"Intangible Assets". Under Statement 142, goodwill and indefinite lives
intangible assets are no longer amortized but are reviewed annually, or more
frequently if impairment indicators arise, for impairment. Separable intangible
assets that have finite lives will continue to be amortized over their useful
lives, for which Statement 142 does not impose a limit. The Corporation
early-adopted the Statement as of April 1, 2001. The adoption of Statement 142
did not materially affect the Corporation's financial condition, results of
operations or liquidity as the Corporation does not currently carry any goodwill
on its financial statements.
6
On April 1, 2001, the Corporation adopted Statement 133, "Accounting for
Derivative Instruments and Hedging Activities". This new standard requires that
all derivative instruments be recorded in the statement of condition at fair
value. The recording of the gain or loss due to changes in fair value could
either be reported in earnings or as other comprehensive income in the statement
of shareholders' equity, depending on the type of instrument and whether or not
it is considered a hedge. The adoption of this new statement did not have a
material effect on the Corporation's financial condition, results of operations,
or liquidity.
In September 2000, FASB issued Statement No. 140, "Accounting for Transfers and
Servicing of Financial Assets and Extinguishment of Liabilities" ("Statement No.
140") that replaces, in its entirety, Statement No. 125. Although Statement No.
140 has changed many of the rules regarding securitizations, it continues to
require an entity to recognize the financial and servicing assets it controls
and the liabilities it has incurred and to derecognize financial assets when
control has been surrendered in accordance with the criteria provided in the
Statement. The Corporation adopted this Statement on April 1, 2001. The
application of the new rules did not have a material impact on the Corporation's
financial statements.
SEGMENT REPORTING Operating segments are components of a business about which
separate financial information is available and that are evaluated regularly by
the chief operating decision maker in deciding how to allocate resources and
assessing performance. Public companies are required to report certain financial
information about operating segments in interim and annual financial statements
if such segments meet quantitative thresholds for reporting segment information.
The Corporation has two operating segments that meet materiality thresholds.
These are the community banking operation and real estate development. Segment
information is disclosed in the audited financial statements incorporated in the
Corporation's Form 10-K for the year ended March 31, 2001.
Certain 2000 accounts have been reclassified to conform to the 2001
presentations.
NOTE 3 - STOCKHOLDERS' EQUITY
On July 8, 2001, 21,300 shares granted pursuant to the Corporation's management
recognition plan were earned by the recipients. During the quarter ended
September 30, 2001, options for 78,500 shares of common stock were exercised at
a weighted-average price of $6.91 per share. Treasury shares were issued in
exchange for the options using the last-in-first-out method. The cost of the
treasury shares issued in excess of the option price paid was charged to
retained earnings $(810,000). During the quarter ended September 30, 2001, the
Corporation repurchased 706,600 shares of common stock. During the quarter,
42,254 shares of treasury stock were reissued to the Corporation's retirement
plans. The weighted-average cost of these shares was $15.42 per share or
$650,000 in the aggregate and the excess of the market price over the cost of
the treasury shares $(10,000) was charged to retained earnings. On August 15,
2001, the Corporation paid a cash dividend of $0.825 per share, amounting to
$1.9 million.
NOTE 4 - EARNINGS PER SHARE
Basic earnings per share for the three and six months ended September 30, 2001
and 2000 have been determined by dividing net income for the respective periods
by the weighted average number of shares of common stock outstanding. Diluted
earnings per share is computed by dividing net income by the weighted average
number of common shares outstanding plus common stock equivalents. Common stock
equivalents are computed using the treasury stock method.
7
THREE MONTHS ENDED SEPTEMBER 30,
--------------------------------
2001 2000
----------- -----------
Numerator:
Net income $ 8,239,595 $ 6,581,500
----------- -----------
Numerator for basic and diluted earnings
per share--income available to common
stockholders $ 8,239,595 $ 6,581,500
Denominator:
Denominator for basic earnings per
share--weighted-average shares 21,872,835 22,627,115
Effect of dilutive securities:
Employee stock options 598,557 614,060
Management Recognition Plans 13,360 --
Denominator for diluted earnings per
share--adjusted weighted-average
----------- -----------
shares and assumed conversions 22,484,752 23,241,175
=========== ===========
Basic earnings per share $ 0.38 $ 0.29
=========== ===========
Diluted earnings per share $ 0.37 $ 0.28
=========== ===========
SIX MONTHS ENDED SEPTEMBER 30,
---------------------------------
2001 2000
-----------
Numerator:
Net income $16,150,867 $13,566,311
----------- -----------
Numerator for basic and diluted earnings
per share--income available to common
stockholders $16,150,867 $13,566,311
Denominator:
Denominator for basic earnings per
share--weighted-average shares 22,027,629 22,967,268
Effect of dilutive securities:
Employee stock options 553,888 609,203
Management Recognition Plans 21,098 --
Denominator for diluted earnings per
share--adjusted weighted-average
----------- -----------
shares and assumed conversions 22,602,615 23,576,471
=========== ===========
Basic earnings per share $ 0.73 $ 0.59
=========== ===========
Diluted earnings per share $ 0.71 $ 0.58
=========== ===========
8
NOTE 5 - SUBSEQUENT EVENTS
On October 22, 2001, the Corporation declared a $0.0825 per share cash dividend
on its common stock to be paid on November 15, 2001 to stockholders of record on
November 1, 2001.
NOTE 6 - BUSINESS COMBINATION
On June 15, 2001, the Corporation announced a definitive agreement to merge
Ledger Capital Corp. ("Ledger") with, and into, the Corporation. Ledger has $490
million in assets as of September 30, 2001, and reported net income of $560,000
for the quarter ended September 30, 2001. The Corporation filed a Registration
Statement on September 14, 2001 for up to 2.9 million shares to be issued in the
transaction. The Corporation is anticipating final approval from all regulatory
authorities and stockholders during the quarter ending December 31, 2001.
In the merger, Ledger shareholders will receive either 1.1 shares of Anchor
BanCorp stock or the taxable cash equivalent, as long as the cash conversion
does not exceed 20 percent of the Ledger shares, in exchange for each share of
Ledger stock. The transaction will be accounted for as a purchase. If completed,
the merger would add 4 full service offices and one limited service office in
the Milwaukee metropolitan area.
9
ANCHOR BANCORP WISCONSIN INC.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
This report contains certain "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. The Corporation desires to take
advantage of the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995 and is including this statement for the expressed purpose of
availing itself of the protection of the safe harbor with respect to all of such
forward-looking statements. These forward-looking statements describe future
plans or strategies and include the Corporation's expectations of future
financial results. The Corporation's ability to predict results or the effect of
future plans or strategies is inherently uncertain and the Corporation can give
no assurance that those results or expectations will be attained. Factors that
could affect actual results include, but are not limited to i) general market
rates, ii) changes in market interest rates and the shape of the yield curve,
iii) general economic conditions, iv) real estate markets, v)
legislative/regulatory changes, vi) monetary and fiscal policies of the U.S.
Treasury and the Federal Reserve, vii) changes in the quality or composition of
the Corporation's loan and investment portfolios, viii) demand for loan
products, ix) the level of loan and MBS repayments, x) deposit flows, xi)
competition, xii) demand for financial services in the Corporation's markets,
and xiii) changes in accounting principles, policies or guidelines. These
factors should be considered in evaluating the forward-looking statements, and
undue reliance should not be placed on such statements.
The Corporation does not undertake and specifically disclaims any obligation to
update any forward-looking statements to reflect occurrence of anticipated or
unanticipated events or circumstances after the date of such statements.
The following discussion is designed to provide a more thorough discussion of
the Corporation's financial condition and results of operations as well as to
provide additional information on the Corporation's asset/liability management
strategies, sources of liquidity and capital resources. Management's discussion
and analysis should be read in conjunction with the consolidated financial
statements and supplemental data contained elsewhere in this report.
RESULTS OF OPERATIONS
General. Net income for the three and six months ended September 30, 2001
increased $1.7 million to $8.2 million from $6.6 million and increased $2.6
million to $16.2 million from $13.6 million, respectively, for the same periods
in the prior year. The increase in net income for the three-month period
compared to the same period last year was largely due to the decrease in
interest expense of $4.1 million. In addition, non-interest income increased
$1.6 million for the three months ended September 30, 2001. These increases were
partially offset by an increase in non-interest expense of $1.6 million, a
decrease in interest income of $1.1 million, an increase in income tax expense
of $960,000, and an increase in provision for loan losses of $390,000 for the
three-month period. The increase in net income for the six-month period compared
to the same period last year was largely due to the increase in non-interest
income of $3.2 million. In addition, interest expense for the six months ended
September 30, 2001 decreased $2.4 million and interest income increased $1.2
million for the same six-month period. These increases were offset by an
increase in non-interest expense of $2.6 million, an increase in income tax
expense of $1.3 million, and an increase in provision for loan losses of
$420,000 for the six-month period.
Net Interest Income. Net interest income increased $3.0 million and $3.7 million
for the three and six months ended September 30, 2001 compared to the same
periods in 2000. The net interest margin increased to 3.11% from 2.77% for the
respective three-month periods and increased to 2.99% from 2.86% for the
respective six-month periods. The interest rate spread increased to 2.97% from
2.61% and increased to 2.85% from 2.68%, respectively, for the same periods.
Interest income on mortgage-related securities increased $470,000 and $1.4
million, respectively, for the three- and six-month periods due primarily to the
increase of $36.9 million and $51.5 million, respectively, in the average
10
balance of mortgage-related securities. Interest income on interest-bearing
deposits increased $160,000 and $380,000, respectively, for the three and six
months ended September 30, 2001, due to the increase of $33.8 million and $37.3
million in the average balance of interest-bearing deposits. Interest income on
loans decreased $1.3 million and increased $340,000 for the three and six months
ended September 30, 2001 as compared to the same periods in the prior year. The
decrease in the interest income on loans for the three-month period was the
result of a decrease of $9.7 million in the average balance of loans and the
increase in interest income for the six-month period was the result of an
increase of $33.4 million in the average balance of loans due to increased loan
originations. Interest income on investment securities (including Federal Home
Loan Bank stock) decreased $460,000 and $930,000, respectively, for the three-
and six-month periods ended September 30, 2001 as compared to the same periods
in the prior year. This was primarily a result of a decrease in the average
yield of 1.71% from 6.34% to 4.63% for the three-month period ended September
30, 2001 and a decrease of $8.7 million in the average balance of the investment
securities and a decrease in the average yield of 1.07% from 6.25% to 5.18% for
the six-month period as compared to the same period in the prior year.
Interest expense on deposits increased $550,000 and $3.6 million for the three
and six months ended September 30, 2001 as compared to the same period in 2000.
These increases were due primarily to the increases in the average balances of
deposits of $277.5 million and $256.9 million, respectively, for the three- and
six-month periods, as a result of various demand deposit and certificate
promotions. Interest expense on notes payable and other borrowings decreased
$4.7 million and $6.0 million, respectively, during the same periods due to a
decrease of $209.0 million and $135.9 million, respectively, in the average
balances of notes payable and other borrowings. Other interest expense remained
relatively constant for the three and six months ended September 30, 2001, as
compared to the same periods in the prior year.
Provision for Loan Losses. Provision for loan losses increased $390,000 to
$550,000 and increased $420,000 to $760,000 for the three- and six-month periods
ended September 30, 2001 compared to the same periods for the prior year. The
provisions were based on management's ongoing evaluation of asset quality.
Average Interest-Earning Assets, Average Interest-Bearing Liabilities and
Interest Rate Spread. The following tables show the Corporation's average
balances, interest, average rates, net interest margin and the spread between
the combined average rates earned on interest-earning assets and average cost of
interest-bearing liabilities for the periods indicated. The average balances are
derived from average daily balances.
11
THREE MONTHS ENDED SEPTEMBER 30,
-------------------------------------------------------------------------
2001 2000
---------------------------------- -----------------------------------
AVERAGE AVERAGE
AVERAGE YIELD/ AVERAGE YIELD/
BALANCE INTEREST COST (1) BALANCE INTEREST COST (1)
-------------------------------------------------------------------------
(Dollars In Thousands)
INTEREST-EARNING ASSETS
Mortgage loans $ 1,867,922 $ 37,630 8.06% $ 1,889,416 $ 37,761 7.99%
Consumer loans 450,910 9,215 8.17 462,722 10,368 8.96
Commercial business loans 95,656 1,752 7.33 72,045 1,764 9.79
----------- -------- ----------- --------
Total loans receivable 2,414,488 48,597 8.05 2,424,183 49,893 8.23
Mortgage-related securities 321,971 5,044 6.27 285,083 4,571 6.41
Investment securities 110,413 1,126 4.08 102,266 1,501 5.87
Interest-bearing deposits 53,957 473 3.51 20,140 316 6.28
Federal Home Loan Bank stock 39,212 606 6.18 35,866 689 7.68
----------- -------- ----------- --------
Total interest-earning assets 2,940,041 55,846 7.60 2,867,538 56,970 7.95
------- ----
Non-interest-earning assets 179,051 162,788
----------- ----------
Total assets $ 3,119,092 $ 3,030,326
=========== ===========
INTEREST-BEARING LIABILITIES
Demand deposits $ 661,857 3,439 2.08 $ 578,755 4,975 3.44
Regular passbook savings 136,277 420 1.23 139,296 579 1.66
Certificates of deposit 1,393,569 20,138 5.78 1,196,169 17,894 5.98
----------- -------- ----------- --------
Total deposits 2,191,703 23,997 4.38 1,914,220 23,448 4.90
Notes payable and other borrowings 639,142 8,827 5.52 848,174 13,508 6.37
Other 17,468 168 3.85 20,014 171 3.42
----------- -------- ----------- --------
Total interest-bearing liabilities 2,848,313 32,992 4.63 2,782,408 37,127 5.34
-------- -------- -------- ----
Non-interest-bearing liabilities 44,279 38,502
----------- ----------
Total liabilities 2,892,592 2,820,910
Stockholders' equity 226,500 209,416
----------- ----------
Total liabilities and stockholders' equity $ 3,119,092 $ 3,030,326
=========== ===========
Net interest income/interest rate spread $ 22,854 2.97% $ 19,843 2.61%
======== ======== ======== =====
Net interest-earning assets $ 91,728 $ 85,130
=========== ========
Net interest margin 3.11% 2.77%
======== =====
Ratio of average interest-earning assets
to average interest-bearing liabilities 1.03 1.03
===========
- --------------------------------------
(1) Annualized
12
SIX MONTHS ENDED SEPTEMBER 30,
-----------------------------------------------------------------------
2001 2000
-----------------------------------------------------------------------
AVERAGE AVERAGE
AVERAGE YIELD/ AVERAGE YIELD/
BALANCE INTEREST COST (1) BALANCE INTEREST COST (1)
-----------------------------------------------------------------------
(Dollars In Thousands)
INTEREST-EARNING ASSETS
Mortgage loans 1,868,246 74,868 8.01% 1,862,181 73,623 7.91%
Consumer loans 458,143 19,113 8.34 455,570 20,175 8.86
Commercial business loans 93,453 3,566 7.63 68,650 3,407 9.93
---------- -------- ---------- --------
Total loans receivable 2,419,842 97,547 8.06 2,386,401 97,205 8.15
Mortgage-related securities 341,290 10,754 6.30 289,806 9,317 6.43
Investment securities 84,351 1,962 4.65 96,478 2,804 5.81
Interest-bearing deposits 59,375 1,075 3.62 22,071 695 6.30
Federal Home Loan Bank stock 38,910 1,232 6.33 35,515 1,323 7.45
---------- -------- ---------- --------
Total interest-earning assets 2,943,768 112,570 7.65 2,830,271 111,344 7.87
---- ----
Non-interest-earning assets 171,240 152,585
---------- ----------
Total assets $3,115,008 $2,982,856
========== ==========
INTEREST-BEARING LIABILITIES
Demand deposits $ 643,311 7,410 2.30 $ 571,976 9,465 3.31
Regular passbook savings 135,038 876 1.30 139,392 1,139 1.63
Certificates of deposit 1,376,561 40,611 5.90 1,186,646 34,702 5.85
---------- ------- ---------- -------
Total deposits 2,154,910 48,897 4.54 1,898,014 45,306 4.77
Notes payable and other borrowings 682,576 19,320 5.66 818,490 25,344 6.19
Other 14,414 276 3.83 16,193 278 3.43
---------- ------- ---------- -------
Total interest-bearing liabilities 2,851,900 68,493 4.80 2,732,697 70,928 5.19
------- ---- ------- ----
Non-interest-bearing liabilities 45,513 38,013
---------- ----------
Total liabilities 2,897,413 2,770,710
Stockholders' equity 217,595 212,146
---------- ----------
Total liabilities and stockholders'
equity $3,115,008 $2,982,856
========== ==========
Net interest income/interest rate
spread 44,077 2.85% 40,416 2.68%
====== ==== ====== ====
Net interest-earning assets $ 91,868 $ 97,574
========== ==========
Net interest margin 2.99% 2.86%
==== ====
Ratio of average interest-earning
assets to average interest-bearing
liabilities 1.03 1.04
==== ====
- -------------------------------------
(1) Annualized
13
Non-Interest Income. Non-interest income increased $1.6 million to $5.1 million
and $3.2 million to $10.1 million, respectively, for the three and six months
ended September 30, 2001 as compared to $3.6 million and $6.9 million for the
same periods in the prior year primarily due to an increase in gain on sale of
loans of $420,000 and $1.7 million, respectively. These increases were due to
increases in secondary market loans sold, resulting from the low interest rate
environment. In addition, net gain on sale of investments and mortgage-related
securities increased $200,000 and $750,000, respectively, for the three- and
six-month periods ended September 30, 2001. Other non-interest income, which
includes a variety of loan fee and other miscellaneous fee income, increased
$300,000 and $710,000 for the respective three- and six- month periods. Service
charges on deposit accounts increased $170,000 and $330,000, respectively, for
the three and six months ended September 30, 2001 due to growth in deposits and
increased fees. Net income from operations of real estate investments increased
$550,000 and $640,000 for the three- and six-month periods ended September 30,
2001 as compared to the same periods in the prior year. These increases were
partially offset by a decrease in loan servicing income of $10,000 and $700,000
due primarily to increased OMSR amortization. In addition, insurance commissions
decreased $70,000 and $270,000 for the three and six months ended September 30,
2001 as compared to the same periods in the prior year due to decreased sales.
Non-Interest Expense. Non-interest expense increased $1.6 million to $14.4
million and $2.6 million to $28.1 million, respectively, for the three and six
months ended September 30, 2001 as compared to $12.8 million and $25.5 million
for the same periods in 2000, as a result of several factors. Compensation
expense increased $1.2 million and $1.7 million, respectively, for the three-
and six-month periods compared to the prior periods due primarily to an increase
in incentive compensation resulting from increased loan production. In addition,
data processing expense increased $40,000 and $270,000, respectively, for the
three and six months ended September 30, 2001 as compared to the same periods in
the prior year due to increased lease payments, line charges and support
services. Other non-interest expense increased $170,000 and $310,000,
respectively, for the three- and six-month periods largely due to increased
office supplies expense and postage expense. Furniture and equipment expense
increased $90,000 and $170,000, in the three- and six-month periods,
respectively, largely due to normal increases in depreciation and increased
contracted services. Occupancy expense increased $40,000 and $110,000,
respectively, for the three and six months ended September 30, 2001 as compared
to the same periods in the prior year due largely to increased utilities expense
and increased leasehold rental. Federal insurance premiums and marketing expense
remained relatively constant during the three- and six-month periods ended
September 30, 2001 as compared to the same periods in 2000.
Income Taxes. Income tax expense increased $960,000 and $1.3 million during the
three and six months ended September 30, 2001 as compared to the same periods in
2000. The effective tax rate was 36.7% and 36.3%, respectively, for the current
three- and six-month periods, as compared to 36.7% and 36.8% for the three- and
six-month periods last year.
14
FINANCIAL CONDITION
During the six months ended September 30, 2001, the Corporation's assets
decreased by $29.3 million from $3.13 billion at March 31, 2001, to $3.10
billion. The majority of this decrease was attributable to decreases in
mortgage-related securities, which were partially offset by increases in
investment securities and loans.
Mortgage-related securities (both available for sale and held to maturity)
decreased $69.9 million during the six months ended September 30, 2001 as a
result of principal repayments and market value adjustments of $50.0 million and
sales of $21.4 million. These decreases were offset slightly by purchases of
$1.5 million of mortgage-related securities in this six-month period.
Mortgage-related securities consisted of $23.5 million of mortgage-backed
securities and $285.8 million of Collateralized Mortgage Obligations ("CMO's")
and Real Estate Mortgage Investment Conduits ("REMIC's") at September 30, 2001.
The Corporation's investments in CMO's and REMIC's are limited to federal agency
issued REMIC's which represent an interest in mortgage-backed securities. These
investments are deemed to have limited credit risk. The investments do have
interest rate risk due to, among other things, actual prepayments being more or
less than those predicted at the time of purchase. The Corporation invests only
in short-term tranches in order to limit the reinvestment risk associated with
greater than anticipated prepayments, as well as changes in value resulting from
changes in interest rates.
Investment securities (both available for sale and held to maturity) increased
$51.4 million during the six months ended September 30, 2001 as a result of
purchases of $251.5 million of U.S. Government and agency securities, which were
partially offset by sales and maturities of $200.1 million.
Total loans (including loans held for sale) increased $7.1 million during the
six months ended September 30, 2001. Activity for the period included (i)
originations and purchases of $414.4 million, (ii) sales of $228.9 million, and
(iii) principal repayments and other adjustments of $178.4 million.
Total liabilities decreased $31.7 million during the six months ended September
30, 2001. Deposits increased $102.9 million during the six months ended
September 30, 2001. The increase was due primarily to new demand deposit
products and certificate promotions. Brokered deposits have been used in the
past and may be used in the future as the need for funds requires them. Brokered
deposits totaled $139.2 million at September 30, 2001 and generally mature
within one year. FHLB advances and other borrowings decreased $125.8 million
during the six months ended September 30, 2001. Reverse repurchase agreements
decreased $15.3 million during the six months ended September 30, 2001. Advance
payments by borrowers for taxes and insurance increased $11.9 million during
this same period. Other liabilities decreased $5.5 million during the six-month
period ended September 30, 2001.
Stockholders' equity increased $2.4 million during the six months ended
September 30, 2001 as a net result of (i) comprehensive income of $17.1 million
(ii) stock options exercised of $2.6 million, with the excess of the cost of
treasury shares over the option price $(920,000) charged to retained earnings,
and tax on compensatory options of $130,000 charged to additional paid-in
capital, and (iii) benefit plan shares earned and related tax adjustments
totaling $770,000. These increases were offset by (i) purchases of treasury
stock of $13.7 million (ii) cash dividends of $3.6 million and (iii) the
purchase of stock by retirement plans of $(10,000).
15
ASSET QUALITY
Loans are placed on non-accrual status when, in the judgment of management, the
probability of collection of interest is deemed to be insufficient to warrant
further accrual. When a loan is placed on non-accrual status, previously accrued
but unpaid interest is deducted from interest income. As a matter of policy, the
Corporation does not accrue interest on loans past due 90 days or more.
Non-performing assets increased $80,000 to $5.8 million at September 30, 2001
from $5.7 million at March 31, 2001 and increased as a percentage of total
assets to 0.19% from 0.18% at such dates, respectively.
Non-performing assets are summarized as follows at the dates indicated:
AT SEPTEMBER 30, AT MARCH 31,
----------------------------------
2001 2001 2000 1999
---------------- ----------------------------------
(Dollars In Thousands)
Non-accrual loans:
Single-family residential $1,749 $2,572 $2,582 $2,931
Multi-family residential 189 372 3 --
Commercial real estate 670 650 126 145
Construction and land 242 257 -- --
Consumer 559 499 571 571
Commercial business 593 697 332 359
------ ------ ------ ------
Total non-accrual loans 4,002 5,047 3,614 4,006
Real estate held for development and sale 78 352 1,691 1,764
Foreclosed properties and repossessed assets, 1,716 313 272 630
------ ------ ------ ------
net
Total non-performing assets $5,796 $5,712 $5,577 $6,400
====== ====== ====== ======
Performing troubled debt restructurings $ 299 $ 300 $ 144 $ 293
====== ====== ====== ======
Total non-accrual loans to total loans 0.15% 0.20% 0.15% 0.18%
Total non-performing assets to total assets 0.19 0.18 0.19 0.24
Allowance for loan losses to total loans 0.91 0.94 1.00 1.08
Allowance for loan losses to total
non-accrual loans 594.03 477.04 675.26 599.78
Allowance for loan and foreclosure losses
to total non-performing assets 411.25 422.16 439.63 379.97
Non-accrual loans decreased $1.0 million during the six months ended September
30, 2001. The decrease was mainly attributed to a single family mortgage loan
for $1.0 million that went from non-accrual at March 31, 2001 to foreclosed
properties and repossessed assets at September 30, 2001. At September 30, 2001,
there were no non-accrual loans with a carrying value greater than $1.0 million.
Non-performing real estate held for development and sale decreased $270,000
during the six months ended September 30, 2001.
16
Foreclosed properties and repossessed assets increased $1.4 million during the
six months ended September 30, 2001 due to the addition of the $1.0 million
single family mortgage loan during the six-month period ended September 30, 2001
from the non-accrual category at March 31, 2001. There were no other foreclosed
properties and repossessed assets with a carrying value greater than $1.0
million at September 30, 2001.
Performing troubled debt restructurings remained constant during the six months
ended September 30, 2001.
At September 30, 2001, assets that the Corporation had classified as
substandard, net of reserves, consisted of $12.5 million of loans and foreclosed
properties. As of March 31, 2001, substandard assets amounted to $6.8 million.
The increase of $5.7 million in substandard assets was due largely to an
increase of $5.0 million in substandard commercial loans. This increase was
substantially due to the addition of two commercial business loans to a business
located in Madison, Wisconsin, during the six-month period ended September 30,
2001. One loan, for $1.9 million, is secured by a general business security
agreement on the equipment and inventory, and the other loan, for $3.5 million,
is secured by the accounts receivable of the business.
The following table sets forth information relating to the Corporation's loans
that were less than 90 days delinquent at the dates indicated.
AT SEPTEMBER 30, AT MARCH 31,
----------------------------------------
2001 2001 2000 1999
------- ------ ------ ------
(In Thousands)
30 to 59 days $13,433 $7,141 $3,224 $5,535
------- ------ ------ ------
60 to 89 days 1,222 716 903 693
------- ------ ------ ------
Total $14,655 $7,857 $4,127 $6,228
======= ====== ====== ======
The Corporation's loan portfolio, foreclosed properties and repossessed assets
are evaluated on a continuous basis to determine the necessity for additions to
the allowance for losses and the related balance in the allowances. These
evaluations consider several factors, including, but not limited to, general
economic conditions, loan portfolio composition, loan delinquencies, prior loss
experience, collateral value, anticipated loss of interest and management's
estimation of future potential losses. The evaluation of the allowance for loan
losses includes a review of known loan problems as well as potential problems
based upon historical trends and ratios. Foreclosed properties are recorded at
the lower of carrying value or fair value with charge-offs, if any, charged to
the allowance for loan losses prior to transfer to foreclosed property. The fair
value is primarily based on appraisals, discounted cash flow analysis (the
majority of which are based on current occupancy and lease rates) and pending
offers.
17
A summary of the activity in the allowance for losses on loans follows:
THREE MONTHS ENDED SIX MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
-------------------------- --------------------------
2001 2000 2001 2000
-------------------------- --------------------------
(Dollars In Thousands)
Allowance at beginning of period $ 23,924 $ 24,404 $ 24,076 $ 24,404
Charge-offs:
Mortgage (402) (502) (540) (513)
Consumer (173) (157) (384) (366)
Commercial business (136) -- (205) (1)
-------- -------- -------- --------
Total charge-offs (711) (659) (1,129) (880)
Recoveries:
Mortgage 1 208 2 217
Consumer 8 14 22 39
Commercial business 1 13 42 15
-------- -------- -------- --------
Total recoveries 10 235 66 271
-------- -------- -------- --------
Net charge-offs (701) (424) (1,063) (609)
Provision for loan losses 550 160 760 345
-------- -------- -------- --------
Allowance at end of period $ 23,773 $ 24,140 $ 23,773 $ 24,140
======== ======== ======== ========
Net charge-offs to average loans (0.12)% (0.07)% (0.09)% (0.05)%
======== ======== ======== ========
Although management believes that the September 30, 2001 allowance for loan
losses is adequate based upon the current evaluation of loan delinquencies,
non-accrual loans, charge-off trends, economic conditions and other factors,
there can be no assurance that future adjustments to the allowance, which could
adversely affect the Corporation's results of operations, will not be necessary.
Management also continues to pursue all practical and legal methods of
collection, repossession and disposal, as well as adhering to high underwriting
standards in the origination process, in order to maintain strong asset quality.
LIQUIDITY AND CAPITAL RESOURCES
On an unconsolidated basis, the Corporation's sources of funds include dividends
from its subsidiaries, including the Bank, interest on its investments and
returns on its real estate held for sale. The Bank's primary sources of funds
are payments on loans and mortgage-related securities, deposits from retail and
wholesale sources, FHLB advances and other borrowings.
At September 30, 2001, the Corporation had outstanding commitments to originate
loans of $161.6 million, commitments to extend funds to, or on behalf of,
customers pursuant to lines and letters of credit of $160.6 million and loans
sold with recourse to the Corporation in the event of default by the borrower of
$1.0 million. The Corporation had sold loans with recourse in the amount of $6.9
million through the FHLB Mortgage Partnership Finance Program at September 30,
2001. Scheduled maturities of certificates of deposit during the twelve months
following September 30, 2001 amounted to $1.15 billion and scheduled maturities
of FHLB advances during the same period totaled $201.9 million. At September 30,
2001, the Corporation also had $12.6 million of reverse repurchase agreements,
all of which are scheduled to mature during the twelve months following
September 30, 2001. Management believes adequate capital and borrowings are
available from various sources to fund all commitments to the extent required.
18
The Bank is required by the Office of Thrift Supervision ("OTS") to maintain
liquid investments in qualifying types of U.S. Government and agency securities
and other investments sufficient to ensure its safe and sound operation. During
the quarter ended September 30, 2001, the Bank's average liquidity ratio was
14.56%.
Under federal law and regulation, the Bank is required to meet certain tangible,
core and risk-based capital requirements. Tangible capital generally consists of
stockholders' equity minus certain intangible assets. Core capital generally
consists of tangible capital plus qualifying intangible assets. The risk-based
capital requirements presently address credit risk related to both recorded and
off-balance sheet commitments and obligations. The OTS requirement for the core
capital ratio for the Bank is currently 3.00%. The requirement is 4.00% for all
but the most highly-rated financial institutions.
The following summarizes the Bank's capital levels and ratios and the levels and
ratios required by the OTS at September 30, 2001 and March 31, 2001 (dollars in
thousands):
MINIMUM REQUIRED
MINIMUM REQUIRED TO BE WELL
FOR CAPITAL CAPITALIZED UNDER
ACTUAL ADEQUACY PURPOSES OTS REQUIREMENTS
-----------------------------------------------------------------------------
AMOUNT RATIO AMOUNT RATIO AMOUNT RATIO
-----------------------------------------------------------------------------
AS OF SEPTEMBER 30, 2001:
Tier 1 capital
(to adjusted tangible $210,492 6.91% $ 91,367 3.00% $152,278 5.00%
assets)
Risk-based capital
(to risk-based assets) 234,001 10.91 171,545 8.00 214,431 10.00
Tangible capital
(to tangible assets) 210,492 6.91 45,683 1.50 N/A N/A
AS OF MARCH 31, 2001:
Tier 1 capital
(to adjusted tangible $199,341 6.50% 92,072 3.00% 153,454 5.00%
assets)
Risk-based capital
(to risk-based assets) 222,496 10.44 170,535 8.00 213,169 10.00
Tangible capital
(to tangible assets) 199,341 6.50 46,036 1.50 N/A N/A
19
The following table reconciles stockholder equity to regulatory capital at
September 30, 2001 and March 31, 2001 (dollars in thousands):
SEPTEMBER 30, MARCH 31,
-------------------------------------------
2001 2001
-------------------------------------------
Stockholders' equity of the Corporation $ 222,033 $219,612
Less: Capitalization of the Corporation and Non-Bank
subsidiaries (7,623) (17,410)
--------- --------
Stockholders' equity of the Bank 214,410 202,202
Less: Intangible assets and other non-includable assets (3,918) (2,861)
--------- --------
Tier 1 and tangible capital 210,492 199,341
Plus: Allowable general valuation allowances 23,509 23,155
--------- --------
Risk based capital $ 234,001 $222,496
========= ========
ASSET/LIABILITY MANAGEMENT
The primary function of asset and liability management is to provide liquidity
and maintain an appropriate balance between interest-earning assets and
interest-bearing liabilities within specified maturities and/or repricing dates.
Interest rate risk is the imbalance between interest-earning assets and
interest-bearing liabilities at a given maturity or repricing date, and is
commonly referred to as the interest rate gap (the "gap"). A positive gap exists
when there are more assets than liabilities maturing or repricing within the
same time frame. A negative gap occurs when there are more liabilities than
assets maturing or repricing within the same time frame. During a period of
rising interest rates, a negative gap over a particular period would tend to
adversely affect net interest income over such period, while a positive gap over
a particular period would tend to result in an increase in net interest income
over such period.
The Corporation's strategy for asset and liability management is to maintain an
interest rate gap that minimizes the impact of interest rate movements on the
net interest margin. As part of this strategy, the Corporation sells
substantially all new originations of long-term, fixed-rate, single-family
residential mortgage loans in the secondary market, and invests in
adjustable-rate or medium-term, fixed-rate, single-family residential mortgage
loans, medium-term mortgage-related securities and consumer loans, which
generally have shorter terms to maturity and higher interest rates than
single-family mortgage loans.
The Corporation also originates multi-family residential and commercial real
estate loans, which generally have adjustable or floating interest rates and/or
shorter terms to maturity than conventional single-family residential loans.
Long-term, fixed-rate, single-family residential mortgage loans originated for
sale in the secondary market are generally committed for sale at the time the
interest rate is locked with the borrower. As such, these loans involve little
interest rate risk to the Corporation.
The calculation of a gap position requires management to make a number of
assumptions as to when an asset or liability will reprice or mature. Management
believes that its assumptions approximate actual experience and considers them
reasonable, although the actual amortization and repayment of assets and
liabilities may vary substantially. The cumulative net gap position at September
30, 2001 has not changed materially since March 31, 2001.
20
ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
The Corporation's market rate risk has not materially changed
from March 31, 2001. See the Corporation's Annual Report on
Form 10-K for the year ended March 31, 2001.
PART II - OTHER INFORMATION
ITEM 1 LEGAL PROCEEDINGS.
The Corporation is involved in routine legal proceedings
occurring in the ordinary course of business which, in the
aggregate, are believed by management of the Corporation to be
immaterial to the financial condition and results of
operations of the Corporation.
ITEM 2 CHANGES IN SECURITIES.
Not applicable.
ITEM 3 DEFAULTS UPON SENIOR SECURITIES.
Not applicable.
ITEM 4 SUBMISSION OF MATTERS TO VOTE OF SECURITIES HOLDERS.
Not applicable.
ITEM 5 OTHER INFORMATION.
None.
ITEM 6 EXHIBITS AND REPORTS.
(a) REPORTS ON FORM 8-K.
On June 25, 2001, the Corporation filed a Current Report on
Form 8-K, which disclosed the Corporation's definitive
agreement providing for the Corporation's acquisition of
Ledger Capital Corp.
On August 8, 2001, the Corporation filed a Current Report on
Form 8-K, announcing the first quarter earnings of the
Corporation for the period ended June 30, 2001.
21
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.
ANCHOR BANCORP WISCONSIN INC.
Date: October 31, 2001 By: /s/ Douglas J. Timmerman
---------------- -------------------------------------------
Douglas J. Timmerman, Chairman of the
Board, President and Chief Executive Officer
Date: October 31, 2001 By: /s/ Michael W. Helser
---------------- -------------------------------------------
Michael W. Helser, Treasurer and
Chief Financial Officer
22