UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------------------
FORM 10-Q
(MARK ONE)
( X ) Quarterly Report under Section 13 or 15(d) of the Securities Exchange Act
of 1934 for the Period Ended June 30, 1996.
( ) Transition Report under Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the Transition Period from ___ to ___.
Commission File Number: 0-18284
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HOMECORP, INC.
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(Exact name of Registrant as specified in its Charter)
Delaware 36-3680814
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(State or Other Jurisdiction of I.R.S. Employer
Incorporation or Organization) Identification Number
1107 East State Street, Rockford, IL 61104-2259
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(Address of Principal Executive Offices) (ZIP Code)
815-987-2200
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(Issuer's Telephone Number, including Area Code)
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the 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
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As of JUNE 30, 1996 there were 1,128,579 issued and outstanding shares of the
Issuer's Common Stock.
HOMECORP, INC.
AND SUBSIDIARY
INDEX
Page
Part I. Financial Information
Item 1. Financial Statements
Balance Sheets as of June 30, 1996 (unaudited) 1
and December 31, 1995
Statements of Earnings (unaudited) for the three
and six months ended June 30, 1996 and 1995 2
Statements of Cash Flows (unaudited) for the
six months ended June 30, 1996 and 1995 3
Notes to Consolidated Financial Statements 4
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operation 7
PART II. Other Information
Item 1. Legal Proceedings 13
Item 4. Submission of Matters to Vote of Security Holders 13
Item 6. Exhibits and Reports on Form 8-K 14
Signatures
CONSOLIDATED BALANCE SHEETS (UNAUDITED) HOMECORP, INC.
(IN THOUSANDS) AND SUBSIDIARY
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June 30, December 31,
1996 1995
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ASSETS:
Cash and cash equivalents:
Cash and non-interest bearing deposits $ 6,636 $ 7,634
Interest bearing deposits 975 388
Federal funds sold 4,345 2,390
Total cash and cash equivalents 11,956 10,412
Securities available for sale, at market value 12,501 8,311
Investment securities (approximate market value of
$5,280 in 1996 and $6,412 in 1995) 5,503 6,504
Mortgage-backed securities (approximate market value
of $20,327 in 1996 and $24,146 in 1995) 20,914 24,488
Federal Home Loan Bank Stock, at cost 2,079 2,279
Loans receivable, net 260,132 261,022
Mortgage loans held for sale 4,684 4,471
Real estate acquired in settlement of loans 9,763 9,790
Investment in real estate developments 4,695 4,060
Premises and equipment 3,510 3,630
Other assets, principally accrued interest 3,247 2,790
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Total Assets $338,984 $338,027
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LIABILITIES:
Deposits $314,811 $314,294
Advance payments by borrowers for taxes and
insurance 1,510 2,075
Other liabilities 1,531 1,234
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Total Liabilities $317,852 $317,603
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SHAREHOLDERS' EQUITY:
Preferred stock-Par Value $0.1; 1,000,000 share
authorized; none outstanding - -
Common stock-Par Value $.01; 5,000,000 shares
authorized; 1,128,579 and 1,126,371 shares
issued and outstanding for 1996 and 1995,
respectively 11 11
Paid-in capital 6,480 6,465
Retained earnings 14,740 13,974
Unrealized loss on securities available for
sale, net of taxes (99) (26)
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Total Shareholders' Equity $ 21,132 $ 20,424
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Total Liabilities and Shareholders' Equity $338,984 $338,027
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CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) HOMECORP, INC.
(IN THOUSANDS, EXCEPT PER SHARE DATA) AND SUBSIDIARY
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Three Months Ended Six Months Ended
June 30, June 30,
1996 1995 1996 1995
---- ---- ---- ----
INTEREST INCOME:
Loans receivable $ 5,344 $ 5,247 $10,648 $10,206
Mortgage-backed securities 320 388 650 802
Securities available for sale 164 107 298 216
Investment securities and other 238 359 443 744
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Total interest income 6,066 6,101 12,039 11,968
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INTEREST EXPENSE:
Deposits 3,647 3,804 7,354 7,264
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Total interest expense 3,647 3,804 7,354 7,264
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Net interest income 2,419 2,297 4,685 4,704
Provision for loan losses 105 90 220 180
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Net interest income after
provision for loan losses 2,314 2,207 4,465 4,524
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NON-INTEREST INCOME:
Fees and service charges 419 342 816 678
Net gains on sale of loans,
investment securities, and
mortgage-backed securities 211 59 549 83
Income (loss) from real estate
developments (14) 148 (14) 95
Operations of real estate owned 116 - 231 -
Other 51 38 84 71
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Total non-interest income 783 587 1,666 927
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NON-INTEREST EXPENSE:
Compensation and benefits 1,251 1,113 2,508 2,240
Office occupancy and equipment 305 295 619 564
Data processing 223 184 441 353
Federal deposit insurance premium 203 218 406 436
Other 443 479 895 870
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Total non-interest expense 2,425 2,289 4,869 4,463
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Income before income taxes 672 505 1,262 988
Income taxes 261 193 495 374
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Net income $ 411 $ 312 $ 767 $ 614
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Earnings per common and common
equivalent share:
Earnings per share $ 0.35 $ 0.26 $ 0.65 $ 0.52
======= ======= ======= =======
CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED) HOMECORP, INC.
(IN THOUSANDS) AND SUBSIDIARY
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Six Months Ended
June 30,
1996 1995
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Cash flows from operating activities:
Net income $ 767 $ 614
Adjustment to reconcile net income to
net cash (used in) operating activities:
Amortization of:
Premiums and discounts on loans, and
mortgage-backed and investment securities 60 43
Net (income)/loss from real estate developments 14 (95)
Provision for loan losses 220 180
Net (gain) loss on sale of:
Loans receivable (549) (83)
Depreciation and amortization of premises
and equipment 233 219
Decrease (Increase) in loans held for sale 57 (6,664)
Increase (decrease) in cash flows due to
changes in:
Accrued interest and other assets (428) (207)
Deferred taxes and other liabilities 297 (39)
Total adjustments (96) (6,646)
Net cash provided by (used in)
operating activities 671 (6,032)
Cash flows from investing activities:
Loan originations, net of principal
payments on loans 4,527 (17,502)
Purchases of:
Loan participations (3,202) -
Securities available for sale (6,997) -
Investment securities (1,000) -
Certificates of deposit (7,000) (11,000)
Premises and equipment (112) (354)
Investment in foreclosed real estate (34) (1,005)
Investment in real estate developments (782) (806)
Principal payments on mortgage-backed
securities 3,485 1,948
Principal repayments of securities
available for sale 685 441
Proceeds from sales of:
Real estate developments - 140
Foreclosed real estate 61 258
Proceeds from maturities of:
Certificates of deposit 7,000 12,000
Investment securities 2,000 -
Securities available for sale 1,986 -
Redemption of investments required by law 172 -
Distributions of income on real estate
partnerships 133 1,209
Net cash provided by investing activities 922 (14,671)
Cash flows from financing activities:
Net increase (decrease) in deposits 517 8,114
Net increase (decrease) in advance payments
by borrowers for taxes and insurance (566) 1,122
Net cash used in financing activities (49) 9,236
Net increase (decrease) in cash and cash
equivalents 1,544 (11,467)
Cash and cash equivalents at beginning of year $10,412 $ 17,983
Cash flows continued:
Six Months Ended
June 30,
1996 1995
---- ----
Cash and cash equivalents
at end of year $11,956 $ 6,516
Supplemental disclosures
of cash flow information
payment during the period
for:
Interest 7,357 7,274
Taxes 240 195
HOMECORP, INC.
AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) MANAGEMENT'S STATEMENT
In the opinion of management the accompanying unaudited financial
statements contain all adjustments (all of which are normal and recurring
in nature) necessary to present fairly the financial position of HomeCorp,
Inc. and Subsidiary (the Company) at June 30, 1996 and December 31, 1995
and the results of operations for three and six month periods ended June
30, 1996 and 1995 and cash flows for the year-to-date periods ended June
30, 1996 and 1995. The Notes to the Consolidated Financial Statements which
are contained in the 1995 Annual Report to Shareholders and incorporated by
reference into the 1995 Form 10-K should be read in conjunction with these
Consolidated Financial Statements.
(2) LOANS RECEIVABLE
Following is a summary of loans receivable for the dates indicated:
June 30, Dec. 31,
(In Thousands) 1996 1995
-------- --------
Conventional first
mortgage loans $180,921 $195,423
Short-term construction
and land loans 13,059 9,102
Commercial business loans 5,467 4,007
Auto loans 46,585 38,687
Home equity and improvement loans 18,792 16,268
Other consumer loans 1,201 1,294
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Total loans receivable,
gross $266,025 $264,781
Less:
Loans in process 4,725 2,754
Deferred loan origination
costs (416) (440)
Unearned discount,
principally on
loans purchased 219 270
Allowance for possible
loan losses 1,365 1,175
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Total loans receivable net $260,132 $261,022
======== ========
Adjustable rate loans totaled $109.3 million and $111.7 million at June 30,
1996 and December 31, 1995, respectively. The Bank serviced first mortgage
loans for other institutions approximating $146.5 million and $125.8
million at June 30, 1996 and December 31, 1995, respectively.
The following summarizes activity in the allowance for loan losses for the
three and six month periods indicated:
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
(In Thousands) 1996 1995 1996 1995
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Balance at beginning of
period $1,271 $1,058 $1,175 $1,048
Charge-offs (12) (118) (33) (198)
Recoveries 1 4 3 4
Provision for possible
loan losses 105 90 220 180
------ ------ ------ ------
Balance at end of year $1,365 $1,034 $1,365 $1,034
====== ====== ====== ======
In addition to residential and commercial mortgage loans and consumer loans
90 days or more delinquent, which totaled $808,000, the Bank identified as
impaired one loan totaling $207,000 to a borrower who also had a commercial
real estate loan that was greater than 90 days delinquent as of June 30,
1996. The $207,000 loan was current at June 30, 1996. Total indebtedness of
this borrower was $981,000 at June 30, 1996. The indebtedness is secured by
a commercial building which is being leased to retail businesses. Lease
activity continued favorably during the second quarter. A reserve of
$45,000 had been established for this borrower at December 31, 1995.
Three loans, each approximately 70 days delinquent, totaling $176,000 were
also considered impaired as of June 30, 1996. The loans are secured by a
building and certain equipment, all of which was used in the operation of a
grocery store. A reserve of $30,000 was established for the loans.
A total of $28,000 in interest income was recognized during the first half
of 1996 on impaired loans, all on an accrual basis. An additional $44,000
of interest income would have been recognized had the non-performing
impaired loans remained current. The average recorded investment in
impaired loans during the six months ended June 30, 1996 was approximately
$1.1 million.
At June 30, 1995, the recorded investment in loans that were considered to
be impaired was $5.9 million (of which $438,000 were on a nonaccrual
basis). There was no allowance for loan losses related to the impaired
loans. The average recorded investment in impaired loans during the six
months ended June 30, 1995 was approximately $5.5 million. For the six
months ended June 30, 1995, the Bank recognized interest income on impaired
loans of $245,000, all of which was recognized on an accrual basis.
The Bank has no restructured loans at June 30, 1996.
(3) EARNINGS PER SHARE
Earnings per share for the three and six months ended June 30, 1996 were
computed by dividing net income by 1,172,020 and 1,171,468, the average
number of common and common equivalent shares (using the treasury share
method) outstanding, respectively. The Company's equivalent shares consist
entirely of common stock options.
Earnings per share for the three and six months ended June 30, 1995 were
computed by dividing net income by 1,161,404 and 1,160,775, the weighted
average number of shares outstanding during the respective periods as
adjusted for the dilutive effect of common stock options.
(4) CHANGES IN ACCOUNTING PRINCIPLES
During the quarter ended March 31, 1996, the Company adopted FASB Statement
No. 122, "Accounting for Mortgage Servicing Rights," Which requires that an
allocation of costs be made between loans and their related servicing
rights for loans originated with a definitive plan to sell with servicing
rights retained. Statement No. 122 requires entities to recognize a
separate asset for servicing rights which will increase the gain on sale of
loans when the servicing rights are retained. Statement No. 122 is being
applied on a prospective basis to mortgage servicing rights acquired after
December 31, 1995. Mortgage servicing rights acquired prior to January 1,
1996 will continue to be accounted for under the prior accounting rules,
under which costs were fully allocated to the loan and servicing income was
recognized as it was received over the life of the loan. The effect of
adopting this statement was to increase net income after incomes taxes by
$202,000 during the six months ended June 30, 1996.
HOMECORP, INC.
AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATION
FORWARD-LOOKING STATEMENTS
When used in this Form 10-Q and in future filings by the Company with the
Securities and Exchange Commission, in the Company's press releases or other
public or shareholder communications, and in oral statements made with the
approval of an authorized executive officer, the words or phrases "will likely
result", "are expected to", "will continue", "is anticipated", "estimate",
"project" or similar expressions are intended to identify "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Such statements are subject to certain risks and uncertainties, that
could cause actual results to differ materially from historical earnings and
those presently anticipated or projected. The Company wishes to caution readers
not to place undue reliance on any such forward-looking statements, which speak
only as of the date made. The Company wishes to advise readers that the factors
listed below could affect the Company's financial performance and could cause
the Company's actual results for future periods to differ materially from any
opinions or statements expressed with respect to future periods in any current
statements.
The Company does not undertake -- and specifically declines any obligation --to
publicly release the result of any revisions which may be made to any forward-
looking statements to reflect events or circumstances after the date of such
statements or to reflect the occurrence of anticipated or unanticipated events.
FINANCIAL CONDITION
The Company has continued its focus upon community banking during 1996, as
evidenced by the continued growth in the consumer and commercial loan
portfolios. The consumer portfolio increased $10.3 million, or 18.4% during the
first six months of 1996. The increase was largely due to the increase in
automobile loans, most of which are originated indirectly through local auto
dealers. While representing a smaller percentage of the total increase, home
equity and improvement loans increased 15.5% during the first six months of
1996. Consumer loan delinquencies declined at June 30, 1996 as compared to
December 31, 1995. The June 30, 1996 delinquency ratio was .2% of the portfolio.
The commercial portfolio increased $1.5 million, or 36.4% during the same time
period. Construction and land loans also increased during the first half of
1996. Gross construction and land loans totaled $13.1 million at June 30, 1996
as compared to $9.1 million at December 31, 1995.
The conventional first mortgage loan portfolio declined $14.5 million during the
six months ended June 30, 1996. The majority of conventional mortgage loan
originations were sold, with the servicing retained by the Bank.
The Bank reclassified $450,000 of the general loan loss reserve against
foreclosed real estate. Reserves had been provided in past periods and it was
determined the reclassification of the reserve amount more accurately reflected
the nature of the allowances provided. The balance of foreclosed real estate at
June 30, 1996 was unchanged from December 31, 1995. The general loan loss
reserve has been reclassified in prior periods to conform to the current year's
presentation.
Investment in real estate developments increased $635,000 to $4.7 million
between June 30, 1996 and December 31, 1995. The increase is primarily the
result of operating costs and improvements within one of the Company's real
estate ventures. All the cash flow generated by the venture is used to reduce
the debt of the venture, which is held by an unaffiliated party.
Deposits increased $517,000 during the first half of 1996. More important than
the increase was the change in mix of the deposit base into core deposits and
shorter term certificates of deposits. Core deposits, defined as checking, NOW,
money market and passbook, increased $4.5 million or 5.4%. The largest increase
was noted in checking and NOW accounts, which increased 7.3% during the first
six months in 1996. The Company undertook a checking account marketing campaign
in the second half of 1995 and several new checking account products were
introduced at that time. The marketing efforts have continued in 1996. Money
market and passbook savings deposits together increased 4.2% 1996. Short term
certificates of deposit, defined as having original terms up to 18 months,
increased $4.3 million or 8.7% while long term certificates of deposit declined
$2.0 million, representing 3.1%.
Stockholder's equity increased to $21.1 million at June 30, 1996 from $20.4
million at December 31, 1995. Stockholder's equity increased from year to date
earnings and was reduced by the increase in the Company's unrealized loss on
securities available for sale. The increase in the unrealized loss was
reflective of the generally higher levels of interest rates at June 30, 1996 as
compared to December 31, 1995.
RESULTS OF OPERATION
The following table presents, for the period indicated, the yields on average
interest-earning assets as well as the cost of average interest-bearing
liabilities. The table does not reflect the impact of income taxes. All averages
are monthly average balances.
Three Months Ended Six Months Ended
June 30, June 30,
1996 1995 1996 1995
---- ---- ---- ----
Loans receivable 8.06% 8.01% 8.02% 7.98%
Other earning assets 5.89 5.93 5.73 5.94
---- ---- ---- ----
Total interest-earning assets 7.72 7.63 7.67 7.59
Deposits 4.75 4.93 4.81 4.76
---- ---- ---- ----
Interest rate spread 2.97% 2.70% 2.86% 2.83%
==== ==== ==== ====
Net interest rate margin 3.08% 2.87% 2.98% 2.98%
==== ==== ==== ====
THREE MONTHS ENDED JUNE 30, 1996 VS 1995:
Net income increased 31.9% to $411,000 for the second quarter of 1996 compared
to $312,000 during the same period in 1995. The most significant increases were
noted in loan sale gains, net interest income and real estate operations. Loan
sale gains increased to $211,000 in the second quarter 1996 from $59,000 in
second quarter 1995. Loan sales increased as all fixed interest rate and
certain adjustable interest rate loan originations were sold in 1996. The
majority of originations and sales were fixed rate. The Company adopted
Statement of Financial Accounting Standards Number 122 on January 1, 1996. The
statement requires the recognition of the value of the servicing right retained
when a loan is sold. This accounting change resulted in an increase of $151,000
in sales gains. The value of the servicing rights will be amortized to expense
as an offset to loan servicing income.
Net interest income increased $122,000 or 5.3% in the second quarter of 1996 as
compared to second quarter 1995. The increase was due largely to the declining
cost of funds noted in 1996, a result of the shift in the deposit mix more
heavily into core deposit products. The shift of assets from short term
securities into loan products also contributed to the increased net interest
income.
Net income from real estate operations represent the net income generated from
the operation of a foreclosed shopping center. Operations totaled $116,000
during the second quarter of 1996. The center was not operated by the Company
during the second quarter of 1995. The center was in excess of 90% leased as of
June 30, 1996 and was listed for sale by the Company.
Loan fees and service charges also increased substantially on a percentage basis
as a result of increased lending and servicing activities and the noted shift in
deposit mix to core deposits, which tend to generate higher levels of service
fee income than the remainder of the deposit base. Total fees and service
charges increased $77,000, or 22.6% between second quarter 1996 and 1995.
The Company's real estate development operations generated a loss of $14,000
during the second quarter of 1996 as compared to income of $148,000 during the
second quarter of 1995. The 1995 income was generated primarily through the sale
of a commercial lot. There were no commercial lot sales during 1996 although
there are commercial lots available for sale in the remaining real estate
projects.
Operating expenses increased $136,000 or 5.9% between second quarter 1996 and
second quarter 1995. The largest increases were noted in compensation and
benefits. This increase is the result of increased compensation incurred with
respect to the Company's expanding lending functions as well as increased
pension costs.
SIX MONTHS ENDED JUNE 30, 1996 VS 1995:
Net income for the first half of 1996 increased 24.8% from 1995 to a total of
$767,000, or $.65 per common equivalent share. The most significant increases
were noted in loan sales gains, real estate operations and loan fees and service
charges. Loan sale gains increased to $549,000 from $83,000. Mortgage loan sales
totaled $33.3 million during the first six months of 1996 compared to $10.4
million during the first six months of 1995. The adoption of a new accounting
standard relating to the sale of mortgage loans resulted in an increase in gain
recognition of $330,000. The gain is amortized to expense as an offset to loan
servicing income.
The operation of a shopping center acquired by the Company through foreclosure
generated net operating income of $231,000 during the first half of 1996. The
loan on the shopping center was included in the loan portfolio at June 30, 1995
and generated interest revenue throughout the first half of 1995.
Loan fees and service charges reflect the increased activity within the loan
portfolios and the shift within the deposit base into checking, NOW, money
market and passbook accounts. Fees and service charges increased $138,000, or
20.3% between the first half of 1996 and 1995. As noted, the Company retains the
servicing on the majority of the mortgage loans sold. The servicing portfolio
totaled $146.5 million at June 30, 1996 as compared to $88.9 million at June 30,
1995. The mortgage servicing portfolio provides a source of fee income as well
as an ongoing customer base within which the Company may cross-sell other
services.
Net interest income was relatively stable, declining $19,000 between the six
month periods ending June 30, 1996 and 1995. The Company has experienced
improvement in its margin throughout the six months ended June 30, 1996.
Management intends to continue the focus upon consumer and commercial loan
growth within the loan portfolio and core deposit growth within the deposit
base.
The development of real estate resulted in a loss of $14,000 during the first
six months of 1996 compared to income of $85,000 during the same period of 1995.
The 1995 income was the result of a commercial lot sale from one of the
Company's real estate projects. There were no commercial lot sales during the
first half of 1996.
Operating expenses increased 9.1% during the first six months of 1996 as
compared to the first six months of 1995. The largest increases were noted in
compensation and benefits, which reflect the increased personnel committed to
the Company's loan origination and servicing activities. Also, pension cost
increased during 1996 as a result of an expansion of full time employees of the
Company. Data processing also increased from the prior year due to the increased
lending, loan servicing, and deposit activity as well as some of the marketing
efforts undertaken by the Company which involve costs related to extracting and
reporting of the Company's total customer base.
LIQUIDITY AND CAPITAL RESOURCES
Liquidity is generally regarded as the ability to generate sufficient cash flow
to meet all present and future funding commitments. The Bank's primary source of
funds, or liquidity, are deposits, amortization and repayment of loan principal
(including mortgage-backed securities) operations and, to a lesser extent,
maturities and sales or mortgage-backed securities and short-term investments.
While scheduled loan repayments and maturing investments are relatively
predictable, deposit flows and early loan repayments are more influenced by
interest rates, general economic conditions and competition.
The Bank's liquidity, represented by cash and cash equivalents, is a product of
its operative activities, investing activities, and financing activities. These
activities are summarized as follows for the six month periods ended June 30,
1996 and 1995.
1996 1995
---- ----
(In Thousands)
Operating Activities:
Net income $ 767 $ 614
Adjustments to reconcile
net income to net cash
used in operating activities (96) (6,646)
------- --------
Net cash used in operating
activities 67 (6,032)
Net cash investing activities 922 (14,671)
Net cash financing activities (49) 9,236
------- --------
Net increase (decrease) in
cash and cash equivalents 1,545 (11,467)
Cash and cash equivalents
at beginning of year 10,412 17,983
------- --------
Cash and cash equivalents
at end of period $11,956 $ 6,516
======= ========
The largest difference in the adjustments to reconcile net income to net cash
used in operating activities between 1996 and 1995 was the increase in mortgage
loans held for sale, which increased $57,000 in 1996 and $6.7 million in 1995.
Mortgage loans held for sale totaled $4.7 million and $6.8 million at June 30,
1996 and 1995, respectively. The average balance of mortgage loans held for sale
was $5.4 million during the six month periods ended June 30, 1996 and 1995,
respectively. The held for sale portfolio has been more consistently maintained
during 1996 as compared to 1995, when it varied from $112,000 to $6.8 million.
Cash investing activities provided $922,000 in cash in the first six months of
1996 as compared to the use of $14.7 million during the first six months of
1995. Principal payments on loans exceeded loans originated for investment by
$4.5 million during 1996. This compares to excess originations of $17.5 million
during 1995. Repayments increased significantly within the Bank's mortgage loan
portfolio during the first quarter of 1996 and slowed somewhat during the second
quarter. Also, the seasoning of the consumer portfolio has resulted in increased
cash flows from repayments.
Financing activities used $49,000 in cash during 1996, primarily due to a
decline of $566,000 in loan escrow balances. The first six months of 1995
provided $9.2 million in cash due to an $8.1 million increase in the deposit
base and $1.1 million in loan escrows. The first installment of property taxes
for Winnebago County, the most significant county of operation for the Company,
was paid during June in 1996 and in July in 1995.
The Bank met all regulatory capital requirements of a fully phased-in basis as
of June 30, 1996.
HOMECORP, INC.
AND SUBSIDIARY
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Bank's suit in the United States Court of Federal Claims
against the United States for breach of contract with regard to
the utilization as capital of the supervisory goodwill, which was
created when the Bank acquired failing institutions in the 1980's,
has been stayed pending the outcome of an appeal in another case
that was heard by the U.S. Supreme Court. While the Supreme Court
ruled favorably on the issue in the other case, the Company's suit
has yet to be heard.
ITEM 4. SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS
The Annual Meeting of Stockholders (the "Meeting") of HomeCorp,
Inc. was held on April 23, 1996. The matters approved by
stockholders at the meeting and the number of votes case for,
against, or withheld (as well as the number of abstentious and
broker non-votes) as to each matter are set forth as follows:
PROPOSAL NUMBER OF VOTES
-------- ---------------
BROKER
FOR WITHHELD NON-VOTES
------- -------- ---------
Election of the following
Directors for a 3-year term:
Richard W. Malmgren 946,984 8,104 --
David R. Rydell 951,799 3,289 --
C. Steven Sjogren 946,984 8,104 --
Directors continuing in their terms:
Karl H. Erickson
Larry U. Larson
Robert C. Hauser
Adam A. Jahns
Wesley E. Lindberg
John R. Perkins
BROKER
FOR AGAINST ABSTAIN NON-VOTES
--------- ------- ------- ---------
Ratification of the
Adoption of the 1996
Premium Stock Option
& Incentive Plan 757,458 30,138 16,783 150,709
BROKER
FOR AGAINST ABSTAIN NON-VOTES
--------- ------- ------- ---------
Ratification of the
appointment of
Ernst & Young LLP
as auditors for
the fiscal year
ending December
31, 1996 941,413 7,324 6,351
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Index to exhibits
(11) Statement regarding computation of earnings per share (included
in Note 3)
(27) Financial Data Schedule (attached)
(b) Reports on Form 8-K
HomeCorp filed the following Form 8-K during the quarter ended June
30, 1996.
April 23, 1996 - The registrant issued a release on April 23, 1996
announcing the results of operations for the first quarter of 1996.
HOMECORP, INC.
AND SUBSIDIARY
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.
HOMECORP, INC.
--------------
(Registrant)
Date: August 12, 1996 /s/ C. Steven Sjogren
--------------------------- ---------------------------------
C. Steven Sjogren
President
Chief Executive Officer
Date: August 12, 1996 /s/ John R. Perkins
--------------------------- ---------------------------------
John R. Perkins
Executive Vice President
Chief Financial Officer
Date: August 12, 1996 /s/ Dirk J. Meminger
--------------------------- ---------------------------------
Dirk J. Meminger
Treasurer
Chief Accounting Officer