1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended June 30, 1996
Commission File Number 0-11928
AMERICAN BANCORP, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
LOUISIANA 72-0951347
- ---------------------------------- -----------------------------------
(State or other jurisdiction of (I R S Employer I. D. Number)
incorporation or organization)
328 EAST LANDRY STREET, OPELOUSAS, LA 70571-1579
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(Address of principal executive office) (Zip Code)
(318) 948-3056
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(Registrant's telephone number, including area code)
NOT APPLICABLE
- --------------------------------------------------------------------------------
(Former name, address, 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 periods 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
----- -----
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date.
Common stock, $5 Par Value-------120,000 shares as of July 15, 1996
2
AMERICAN BANCORP, INC.
(PARENT COMPANY ONLY)
BALANCE SHEET
June 30, 1996 and 1995
(In Thousands)
ASSETS 1996 1995
- ------ ------ ------
Cash 2 3
Investment in Subsidiary 7,245 6,274
Dividend Receivable 0 0
Due From Subsidiary 42 339
------ ------
TOTAL ASSETS $7,289 $6,616
====== ======
LIABILITIES
- -----------
Federal Income Taxes Payable 37 226
Other Liabilities 0 0
------ ------
TOTAL LIABILITIES $37 $226
------ ------
SHAREHOLDERS' EQUITY
- --------------------
Unrealized Gain (Loss) on Securities
Available for Sale 20 74
Common Stock, $5 par value; authorized
10,000,000 shares; issued 120,000 shares 600 600
Surplus 2,150 2,150
Retained Earnings 4,482 3,566
------ ------
TOTAL EQUITY 7,252 6,390
------ ------
TOTAL LIABILITIES & EQUITY $7,289 $6,616
====== ======
3
AMERICAN BANCORP, INC.
CONSOLIDATED BALANCE SHEETS
June 30, 1996 and 1995
(In Thousands)
1996 1995
------- -------
ASSETS
------
Cash and Due From Banks 3,967 3,655
Interest Bearing Deposits 1,091 891
Securities Held to Maturity 17,019 18,998
Securities Available for Sale 6,868 3,546
Federal Funds Sold 4,350 5,400
Loans - Net 27,646 26,106
Bank Premises and Equipment 1,388 1,310
Other Real Estate Owned 14 14
Accrued Interest Receivable 581 483
Deferred Tax Asset 15 27
Prepaid Expenses and Other Assets 441 275
------- -------
TOTAL ASSETS $63,380 $60,705
======= =======
LIABILITIES
-----------
Deposits:
Non-Interest Bearing 16,274 16,146
Interest Bearing 39,621 37,797
------- -------
Total Deposits 55,895 53,943
Accrued Interest Payable 120 99
Deferred Income Tax Credits 0 0
Accrued Expenses and Other Liabilities 113 273
------- -------
TOTAL LIABILITIES $56,128 $54,315
------- -------
SHAREHOLDERS' EQUITY
--------------------
Unrealized Gain (Loss) on Securities
Available for Sale 20 74
Common Stock, $5 par value; authorized
10,000,000 shares; issued 120,000 shares 600 600
Surplus 2,150 2,150
Retained Earnings 4,482 3,566
------- -------
TOTAL SHAREHOLDERS' EQUITY $7,252 $6,390
------- -------
TOTAL LIABILITIES & EQUITY $63,380 $60,705
======= =======
See Notes to Financial Statements.
4
AMERICAN BANCORP, INC.
(PARENT COMPANY ONLY)
INCOME STATEMENT
For the Six Month Periods Ended June 30, 1996 and 1995
(In Thousands)
1996 1995
---- ----
INCOME FROM SUBSIDIARY
- ----------------------
Dividends $0 $0
OPERATING EXPENSES
- ------------------
Other Expenses 1 4
Interest Expense 0 0
---- ----
TOTAL EXPENSES $1 $4
---- ----
Earnings (loss) before income tax benefit
and equity in undistributed earnings of
subsidiary ($1) ($4)
Income tax (benefit) 0 5
---- ----
Earnings (loss) before equity in undistributed
earnings of subsidiary ($1) ($9)
Equity in undistributed earnings of
subsidiary 553 506
---- ----
Net Income $552 $497
==== ====
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AMERICAN BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME
For the Six Month Periods Ended June 30, 1996 and 1995
(In Thousands)
INCREASE
1996 1995 (DECREASE)
INTEREST INCOME: ------ ------ ----------
Interest and fees on loans $1,278 $1,278 0
Interest on investment securities:
Taxable 641 652 (11)
Tax-Exempt 52 9 43
Other Interest 132 156 (24)
------ ------ -----
TOTAL INTEREST INCOME $2,103 $2,095 8
------ ------ -----
INTEREST EXPENSE:
Interest on deposits $640 $556 84
Interest on short-term borrowings 0 0 0
------ ------ -----
TOTAL INTEREST EXPENSE $640 $556 84
------ ------ -----
NET INTEREST INCOME $1,463 $1,539 (76)
Provision for possible loan losses 0 0 0
------ ------ -----
Net Interest Income after provision for
possible loan losses $1,463 $1,539 (76)
------ ------ -----
NON-INTEREST INCOME:
Service charges on deposit accounts $260 $275 (15)
Investment securities gains (losses) 0 0 0
Other 53 50 3
------ ------ -----
TOTAL NON-INTEREST INCOME $313 $325 (12)
------ ------ -----
NON-INTEREST EXPENSE:
Salaries and Employee Benefits $527 $554 (27)
Net Occupancy Expense 295 274 21
Net cost of operation of O.R.E.O. (2) (1) (1)
Other 280 318 (38)
------ ------ -----
TOTAL NON-INTEREST EXPENSE $1,100 $1,145 (45)
------ ------ -----
INCOME BEFORE INCOME TAXES AND
EXTRAORDINARY ITEMS $676 $719 (43)
INCOME TAX (BENEFIT) 124 222 (98)
------ ------ -----
INCOME BEFORE EXTRAORDINARY ITEMS $552 $497 55
EXTRAORDINARY ITEMS 0 0 0
------ ------ -----
NET INCOME $552 $497 55
====== ====== =====
Net income per share of common stock $4.60 $4.14 $0.46
====== ====== =====
See Notes to Consolidated Financial Statements
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AMERICAN BANCORP, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
For the Six Month Periods Ended June 30, 1996 & 1995
(In Thousands)
NET
UNREALIZED
GAINS(LOSS) COMMON RETAINED
SECURITIES STOCK SURPLUS EARNINGS TOTAL
----------- ------ ------- -------- ------
Balance 12/31/94 ($1) $600 $2,150 $3,069 $5,818
Net Income (Loss) 497 497
Cash Dividends 0 0
Change in Unrealized
Gains/Losses 75 75
---- ----- ------- ------- -------
Balance 6/30/95 $74 $600 $2,150 $3,566 $6,390
==== ===== ======= ======= =======
Balance 12/31/95 $105 $600 $2,150 $3,930 $6,785
Net Income (Loss) 552 552
Cash Dividends 0 0
Change in Unrealized
Gains/Losses (85) (85)
---- ----- ------- ------- -------
Balance 6/30/96 $20 $600 $2,150 $4,482 $7,252
==== ===== ======= ======= =======
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AMERICAN BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Six Month Periods Ended June 30, 1996 and 1995
1996 1995
------- -------
OPERATING ACTIVITIES
Net income $552 $497
Adjustments to reconcile net income to net cash
provided by operating activities:
Accretion of investment security discounts (11) (11)
Amortization of investment security premiums 10 5
Depreciation 99 87
Provision for loan losses 0 0
Gain on sale of other real estate 0 0
Gain/loss on sale of assets 0 0
Decrease (increase) in accrued interest receivable (29) (53)
Increase (decrease) in accrued interest payable 17 19
Increase (decrease) in other liabilities (413) 261
Decrease(increase) in other asset 0 (27)
------- -------
Net cash provided by operating activities $225 $778
------- -------
INVESTING ACTIVITIES
Proceeds from sales & maturities of available for sale securities $324 $205
Proceeds from sales & maturities of held to maturity securities 3,500 2,500
Purchases of available for sale securities (2,178) (504)
Purchases of held to maturity securities (4,023) (5,012)
(Increase) decrease in interest-bearing deposits with banks (397) 1,583
(Increase) decrease in loans (1,256) 947
Decrease (increase) in federal funds sold 2,000 650
Net decrease (increase) in other real estate 0 0
Proceeds from sale of assets 0 0
Purchases of property & equipment (51) (22)
Other 50 11
------- -------
Net cash provided (used) by investing activities ($2,031) $358
------- -------
FINANCING ACTIVITIES
Increase (decrease) in non-interest bearing deposits ($656) $154
Increase (decrease) in int-bearing deposits 895 (5,441)
Dividends paid 0 0
------- -------
Net cash provided (used) by financing activities $239 ($5,287)
------- -------
Increase (decrease) in cash and cash equivalents ($1,567) ($4,151)
Cash and cash equivalents at beginning of year 5,534 7,806
------- -------
Cash and cash equivalents at end of period $3,967 $3,655
======= =======
Cash interest income received $2,074 $2,042
======= =======
Cash interest expense paid $623 $537
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AMERICAN BANCORP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1996
NOTE 1 - A BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements
have been prepared in accordance with generally accepted
principles of accounting for instructions to Form 10-Q and
Article 10 of Regulations S-X. Accordingly, they do not include
all of the information and footnotes required by generally
accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary
for a fair presentation have been included.
NOTE 2 - IMPAIRED LOANS
On January 1, 1995 the Company adopted Statement of
Financial Accounting Standards (SFAS) No. 114, "Accounting by
Creditors for Impairment of a Loan." The adoption of SFAS No.
114 did not have a material impact on the financial condition
or operating results of the Company. Interest payments
received on impaired loans are applied to principal if there is
doubt as to the collectibility of the principal; otherwise,
these receipts are recorded as interest income.
As it relates to in-substance foreclosures, SFAS No. 114
requires that a creditor continue to follow loan classification
on the balance sheet unless the creditor receives physical
possession of the collateral. The Company had no in-substance
foreclosures in foreclosed assets to transfer to nonperforming
loans and no related reserve for losses to transfer to the
reserve for possible loan losses.
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Management's Discussion presents a review of the major factors and trends
affecting the performance of the Company and its bank subsidiary and should be
read in conjunction with the accompanying consolidated financial statements and
notes.
OVERVIEW
The Company reported net income of $ 552,000 for the first six months of
1996 compared to $ 497,000 for the same period of 1995. On a per share basis,
the income was $ 4.60 for the first half of 1996 compared to $ 4.14 for the
same period of 1995. The Company recorded a provision for possible loan losses
of $ 0 for the six months ended June 30, 1996 and 1995, respectively. Net
interest income decreased 4.9% to $ 1,463,000 for the first half of 1996
compared to $ 1,539,000 for the same period of 1995.
Total assets were $ 63,380,000 at June 30, 1996, an increase of
$ 2,675,000 from June 30, 1995. Loans increased by $ 1,540,000 or 5.9% from
$ 26,106,000 at June 30, 1995 to $ 27,646,000 at June 30, 1996. Deposits also
increased from $ 53,943,00 at June 30, 1995 to $ 55,895,000 at June 30, 1996.
RESULTS OF OPERATIONS
NET INTEREST INCOME. Net interest income for the six months ended June
30, 1996 totaled $ 1,463,000, a $ 76,000 decrease from the same period in 1995.
Factors contributing to this decrease include an increase in the average rate
paid on time deposits. The increase in interest expense was partially offset
by an increase in the average balance of tax-exempt securities. The overall
effect of volume and rate changes on net interest income during the first half
of 1996 was unfavorable.
PROVISION FOR POSSIBLE LOAN LOSSES. The Company recorded no provision
for possible loan losses for both the first half of 1996 and 1995. The
absence of a provision is the result of continued improvements in asset quality
and low net charge offs of loans. As a percentage of outstanding loans, the
allowance for possible loan losses was 2.20% and 2.32% at June 30, 1996 and
1995, respectively.
NONINTEREST INCOME. There has been immaterial variances in noninterest
income for the six month periods ended June 30, 1996 and 1995. The $ 12,000
decrease in noninterest income for the first half of 1996 is the result of a
$ 15,000 decrease in total service charges on deposit account as compared to the
same period of 1995.
There were no securities gains in the first six months of 1996 or of 1995.
NONINTEREST EXPENSE. For the first six months of 1996 noninterest
expense decreased $ 45,000 or 3.9% compared to the same period in 1995.
Salaries and employee benefits, the largest component of noninterest expense,
decreased by $ 27,000 or 4.9% for the first six months of 1996 as compared to
the same period in 1995. Employee medical insurance expense decreased by
$ 36,000 for the first half of 1996 as compared to the same period of 1995.
This decrease is reflective of a decrease in medical claim experience for the
six months ended June 30, 1996.
Other expenses decreased by $ 38,000 or 12% for the first six months of 1996
as compared to the same period in 1995. The most significant variance was a
decrease in FDIC assessment expense of $ 58,000 due to a reduction in the FDIC
assessment rates. The other categories in non-interest expense experienced
normal variations between the first half of 1996 and 1995.
INCOME TAXES. The Company recorded provisions for income taxes of
$ 124,000 in the first half of 1996 as compared to $ 222,000 in the first half
of 1995. Upon filing the 1995 federal tax return the company was able to
utilize tax credits of $ 96,000 carried forward. These tax credits were
included in deferred tax assets as of December 31, 1995, however, a deferred
tax valuation reserve was also recorded due to uncertainty of realizable value.
10
FINANCIAL CONDITION
LOANS. Loans were $ 27,646,000 at June 30, 1996; up by $ 1,540,000 or
5.9% from June 30, 1995.
TABLE I - COMPOSITION OF LOAN PORTFOLIO
- ---------------------------------------
June 30, 1996 June 30, 1995
-------------- -------------
Commercial, Financial and Agricultural $6,487 $5,794
Real Estate Construction 310 29
Real Estate Mortgage 16,093 16,285
Consumer Loans 4,776 3,846
Industrial Revenue Bonds 601 773
------- -------
TOTAL LOANS $28,267 $26,727
Allowance for possible loan losses 621 621
Unearned income 0 0
------- -------
$27,646 $26,106
======= =======
SECURITIES HELD TO MATURITY. Securities held to maturity were $ 17,019,000
at June 30, 1996; down by $ 1,979,000 from June 30, 1995.
SECURITIES AVAILABLE FOR SALE. Securities available for sale were
$ 6,868,000 at June 30, 1996; up by $ 3,322,000 or 94% from June 30, 1995.
Securities classified as available for sale are primarily mortgage backed
securities and municipal securities.
TABLE II - INVESTMENT SECURITIES
- --------------------------------
A comparison of the book value and estimated market value of investment
securities is as follows:
June 30, 1996
---------------------------------------------
HELD-TO-MATURITY AVAILABLE-FOR-SALE
AMORT MARKET AMORT MARKET
COST VALUE COST VALUE
U.S. Treasury $5,000 $5,016 $995 995
U.S. Agencies 12,019 11,906 3,424 3,479
State & Political Subdivisions 0 0 2,418 2,394
------- ------- ------ ------
TOTAL $17,019 $16,922 $6,837 $6,868
======= ======= ====== ======
June 30, 1995
--------------------------------------------
HELD-TO-MATURITY AVAILABLE-FOR-SALE
AMORT MARKET AMORT MARKET
COST VALUE COST VALUE
U.S. Treasury $5,510 $5,513 $0 0
U.S. Agencies 13,488 13,476 2,931 3,028
State & Political Subdivisions 0 0 503 518
------- ------- ------ ------
TOTAL $18,998 $18,989 $3,434 $3,546
======= ======= ====== ======
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TABLE III - NONPERFORMING ASSETS
- --------------------------------
Non-performing assets include nonaccrual loans, loans which are contractually
90 days past due, restructured loans, and foreclosed assets. Restructured
loans are loans which, due to a deteriorated financial condition of the
borrower, have a below market yield. Interest payments received on
nonperforming loans are applied to reduce principal if there is doubt as to the
collectibility of the principal; otherwise, these receipts are recorded as
interest income. Certain nonperforming loans are current as to principal and
interest payments are classified as nonperforming because there is a question
concerning full collectibility of both principal and interest.
June 30, 1996 June 30, 1995
-------------- --------------
Non-Performing Loans:
Loans on Non-Accrual $1 $2
Loans past due 90 days or more as to
principal or interest, but not on
non-accrual 35 11
Loans & leases restructured and in
compliance with terms 33 23
---- ----
$69 $36
Other Real Estate and repossessed assets
received in complete or partial
satisfaction of debt 14 14
---- ----
TOTAL NONPERFORMING ASSETS $83 $50
==== ====
TABLE IV - ANALYSIS OF ALLOWANCE FOR LOAN LOSSES
- ------------------------------------------------
June 30, 1996 June 30, 1995
-------------- --------------
Beginning balance $624 $614
Charge-offs:
Commercial, financial and agricultural - -
Real estate - construction - -
Real estate - mortgage - -
Installment loans to individuals 9 2
----- -----
Total charge-offs 9 2
----- -----
Recoveries:
Commercial, financial and agricultural 4 3
Real estate - construction - -
Real estate - mortgage 1 -
Installment loans to individuals 1 6
----- -----
Total recoveries 6 9
----- -----
Net charge-offs 3 (7)
----- -----
Provision charged against income - -
----- -----
Balance at end of period $621 $621
===== =====
Ratio of net charge-offs during the period to average loans
outstanding during the period 0.01% (.03%)
===== =====
The present level of the allowance for loan losses is considered adequate to
absorb future potential loan losses. In making this determination, management
considered asset quality, the level of net loan charge-offs, as well as current
economic conditions and market trends.
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TABLE V - ALLOCATION OF THE ALLOWANCE FOR LOAN LOSSES
- -----------------------------------------------------
The allowance for possible loan losses has been allocated according to the
amount deemed to be reasonably necessary to provide for the possibility of
losses being incurred within the following categories of loans.
June 30, 1996 June 30, 1995
---------------------- -----------------------
% OF LOANS % OF LOANS
TO TOTAL TO TOTAL
AMOUNT LOANS AMOUNT LOANS
---------------------- -----------------------
Commercial, financial and
agricultural $143 23% $137 22%
Real estate - construction 6 1% 6 1%
Real estate - mortgage 360 57% 373 60%
Installment loans 100 17% 105 17%
Industrial revenue bonds 12 2% 0 0%
----- ------
$621 100% $621 100%
===== ======
DEPOSITS. As of June 30, 1996 total deposits have increased by
$ 1,952,000 or 3.6% from June 30, 1995. Noninterest bearing deposits increased
by $ 128,000 or .8% from June 30, 1995 to June 30, 1996. Interest bearing
deposits increased by $ 1,824,000 or 4.8% from June 30, 1995 to June 30, 1996.
CAPITAL. Shareholders' equity totaled $ 7,252,000 at June 30, 1996,
compared to $ 6,390,000 at June 30, 1995. The increase is primarily the result
of net income over the most recent 12 months. Risk-based capital and leverage
ratios for the Company and the bank subsidiary exceed the ratios required for
the designation as a "well-capitalized" institution under regulatory
guidelines.
TABLE VI - CAPITAL RATIOS
- -------------------------
June 30,
----------------------------
AMERICAN BANK & TRUST COMPANY 1996 1995
(Bank subsidiary) ------------- --------------
Risk-based capital:
Tier 1 risk-based capital ratio 22.96% 21.02%
Total risk-based capital ratio 24.21% 22.27%
Leverage ratio 12.10% 10.52%
INSIDERS. Directors, executive officers and 10 % shareholders and their
related interest had loans outstanding totaling $ 1,479,000 at June 30, 1996.
CONTINGENT LIABILITIES. In the normal course of business, the bank
becomes involved in legal proceedings. It is the opinion of management that
the resulting liability, if any, for pending litigation is negligible.
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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 to sign on behalf of th registrant.
AMERICAN BANCORP, INC.
--------------------------------
(Registrant)
8/7/1996 /s/ Salvador L. Diesi
- --------------- --------------------------------
DATE Salvador L. Diesi
Chairman of the Board/President
8/7/1996 /s/ Ronald J. Lashute
- --------------- --------------------------------
DATE Ronald J. Lashute
Secretary/Treasurer
of the Board
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INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
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27 Financial Data Schedule