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 March 31, 1997
Commission File Number 0-11928
AMERICAN BANCORP, INC.
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(Exact name of registrant as specified in its charter)
LOUISIANA 72-0951347
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(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
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(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 April 28, 1997
2
AMERICAN BANCORP, INC.
(PARENT COMPANY ONLY)
BALANCE SHEET
March 31, 1997 and 1996
(In Thousands)
ASSETS 1997 1996
- ------ -------- --------
Cash 4 3
Investment in Subsidiary 7,838 7,058
Dividend Receivable 0 0
Due From Subsidiary 143 134
-------- --------
TOTAL ASSETS $ 7,985 $ 7,195
======== ========
LIABILITIES
- -----------
Federal Income Taxes Payable 137 129
Other Liabilities 0 0
-------- --------
TOTAL LIABILITIES $ 137 $ 129
-------- --------
SHAREHOLDERS' EQUITY
- --------------------
Unrealized Gain (Loss) on Securities
Available for Sale 6 74
Common Stock, $5 par value; authorized
10,000,000 shares; issued 120,000 shares 600 600
Surplus 2,150 2,150
Retained Earnings 5,092 4,242
-------- --------
TOTAL EQUITY 7,848 7,066
-------- --------
TOTAL LIABILITIES & EQUITY $ 7,985 $ 7,195
======== ========
3
AMERICAN BANCORP, INC.
CONSOLIDATED BALANCE SHEETS
March 31, 1997 and 1996
(In Thousands)
1997 1996
-------- --------
ASSETS
------
Cash and Due From Banks 5,350 4,063
Interest Bearing Deposits 694 1,091
Securities Held to Maturity 15,031 16,500
Securities Available for Sale 10,212 5,935
Federal Funds Sold 4,000 2,550
Loans - Net 27,011 26,046
Bank Premises and Equipment 1,304 1,409
Other Real Estate Owned 14 14
Accrued Interest Receivable 593 618
Deferred Tax Asset 18 0
Prepaid Expenses and Other Assets 462 439
-------- --------
TOTAL ASSETS $ 64,689 $ 58,665
======== ========
LIABILITIES
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Deposits:
Non-Interest Bearing 16,620 14,682
Interest Bearing 39,680 36,589
-------- --------
Total Deposits 56,300 51,271
Accrued Interest Payable 110 104
Deferred Income Tax Credits 0 16
Accrued Expenses and Other Liabilities 431 208
-------- --------
TOTAL LIABILITIES $ 56,841 $ 51,599
-------- --------
SHAREHOLDERS' EQUITY
--------------------
Unrealized Gain (Loss) on Securities
Available for Sale 6 74
Common Stock, $5 par value; authorized
10,000,000 shares; issued 120,000 shares 600 600
Surplus 2,150 2,150
Retained Earnings 5,092 4,242
-------- --------
TOTAL SHAREHOLDERS' EQUITY $ 7,848 $ 7,066
-------- --------
TOTAL LIABILITIES & EQUITY $ 64,689 $ 58,665
======== ========
See Notes to Financial Statements.
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AMERICAN BANCORP, INC.
(PARENT COMPANY ONLY)
INCOME STATEMENT
For the Three Month Periods Ended March 31, 1997 and 1996
(In Thousands)
1997 1996
-------- --------
INCOME FROM SUBSIDIARY
- ----------------------
Dividends $ 0 $ 0
OPERATING EXPENSES
- ------------------
Other Expenses 0 1
Interest Expense 0 0
-------- --------
TOTAL EXPENSES $ 0 $ 1
-------- --------
Earnings (loss) before income tax benefit
and equity in undistributed earnings of
subsidiary $ 0 $ (1)
Income tax (benefit) 0 0
-------- --------
Earnings (loss) before equity in undistributed
earnings of subsidiary $ 0 $ (1)
Equity in undistributed earnings of
subsidiary 243 313
-------- --------
Net Income $ 243 $ 312
======== ========
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AMERICAN BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME
For the Three Month Periods Ended March 31, 1997 and 1996
(In Thousands)
INCREASE
1997 1996 (DECREASE)
-------- -------- ----------
INTEREST INCOME:
Interest and fees on loans $ 637 $ 632 5
Interest on investment securities:
Taxable 352 310 42
Tax-Exempt 29 24 5
Other Interest 74 71 3
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TOTAL INTEREST INCOME $ 1,092 $ 1,037 55
-------- -------- --------
INTEREST EXPENSE:
Interest on deposits $ 348 $ 315 33
Interest on short-term borrowings 0 0 0
-------- -------- --------
TOTAL INTEREST EXPENSE $ 348 $ 315 33
-------- -------- --------
NET INTEREST INCOME $ 744 $ 722 22
Provision for possible loan losses 0 0 0
-------- -------- --------
Net Interest Income after provision for
possible loan losses $ 744 $ 722 22
-------- -------- --------
NON-INTEREST INCOME:
Service charges on deposit accounts $ 122 $ 132 (10)
Investment securities gains (losses) 0 0 0
Other 31 34 (3)
-------- -------- --------
TOTAL NON-INTEREST INCOME $ 153 $ 166 (13)
-------- -------- --------
NON-INTEREST EXPENSE:
Salaries and Employee Benefits $ 264 $ 261 3
Net Occupancy Expense 138 145 (7)
Net cost of operation of O.R.E.O. (1) (1) 0
Other 148 153 (5)
-------- -------- --------
TOTAL NON-INTEREST EXPENSE $ 549 $ 558 (9)
-------- -------- --------
INCOME BEFORE INCOME TAXES AND
EXTRAORDINARY ITEMS $ 348 $ 330 18
INCOME TAX (BENEFIT) 105 18 87
-------- -------- --------
INCOME BEFORE EXTRAORDINARY ITEMS $ 243 $ 312 (69)
EXTRAORDINARY ITEMS 0 0 0
-------- -------- --------
NET INCOME $ 243 $ 312 (69)
======== ======== ========
Net income per share of common stock $ 2.03 $ 2.60 $ (0.58)
======== ======== ========
See Notes to Consolidated Financial Statements
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AMERICAN BANCORP, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
For the Three Month Periods Ended March 31, 1997 & 1996
(In Thousands)
NET
UNREALIZED
GAINS (LOSS) COMMON RETAINED
SECURITIES STOCK SURPLUS EARNINGS TOTAL
------------ ------ ------- -------- --------
Balance 12/31/95 $ 105 $ 600 $ 2,150 $ 3,930 $ 6,785
Net Income (Loss) 312 312
Cash Dividends 0 0
Change in Unrealized
Gains/Losses (31) (31)
-------- -------- -------- -------- --------
Balance 3/31/96 $ 74 $ 600 $ 2,150 $ 4,242 $ 7,066
======== ======== ======== ======== ========
Balance 12/31/96 $ 57 $ 600 $ 2,150 $ 4,849 $ 7,656
Net Income (Loss) 243 243
Cash Dividends 0 0
Change in Unrealized
Gains/Losses (51) (51)
-------- -------- -------- -------- --------
Balance 3/31/97 $ 6 $ 600 $ 2,150 $ 5,092 $ 7,848
======== ======== ======== ======== ========
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AMERICAN BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Three Month Periods Ended March 31, 1997 and 1996
1997 1996
-------- --------
OPERATING ACTIVITIES
Net income $ 243 $ 312
Adjustments to reconcile net income to net cash
provided by operating activities:
Premium amortization, net of accretion on
investment securities 6 1
Depreciation 49 48
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 (25) (67)
Increase (decrease) in accrued interest payable (9) 1
Increase (decrease) in other liabilities 320 (303)
Decrease(increase) in other asset (23) 17
-------- --------
Net cash provided by operating activities $ 561 $ 9
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INVESTING ACTIVITIES
Proceeds from sales & maturities of available for sale securities $ 334 184
Proceeds from sales & maturities of held to maturity securities 500 2,500
Purchases of available for sale securities (1,972) (1,026)
Purchases of held to maturity securities 0 (2,495)
(Increase) decrease in loans 1,301 344
Net decrease (increase) in other real estate 0 0
Purchases of property & equipment (17) (22)
Other 23 16
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Net cash provided (used) by investing activities $ 169 $ (499)
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FINANCING ACTIVITIES
Increase (decrease) in demand deposits, transaction $ (2,442) $ (5,299)
accounts and savings
Increase (decrease) in time deposits (625) 915
Dividends paid 0 0
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Net cash provided (used) by financing activities $ (3,067) $ (4,384)
-------- --------
Increase (decrease) in cash and cash equivalents $ (2,337) $ (4,874)
Cash and cash equivalents at beginning of year 12,381 12,578
-------- --------
Cash and cash equivalents at end of period $ 10,044 $ 7,704
======== ========
Cash payments for:
Interest expense $ 357 $ 314
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Income taxes $ 0 $ 296
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See Notes to Consolidated Financial Statements
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AMERICAN BANCORP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1997
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 $ 243,000 for the first three months
of 1997 compared to $ 312,000 for the same period of 1996. On a per share
basis, the income was $ 2.03 for the first quarter of 1997 compared to $ 2.60
for the same period of 1996. The Company recorded a provision for possible loan
losses of $ 0 for the three months ended March 31, 1997 and 1996, respectively.
Net interest income increased 3 % to $ 744,000 for the first quarter of 1997
compared to $ 722,000 for the same period of 1996.
Total assets were $ 64,689,000 at March 31, 1997, an increase of
$ 6,024,000 from March 31, 1996. Loans remain fairly constant at $ 27,011,000
and $ 26,046,000 at March 31, 1997 and 1996, respectively. Deposits increased
$ 5,029,000 to $ 56,300,000 at March 31, 1997.
RESULTS OF OPERATIONS
NET INTEREST INCOME. Net interest income for the three months ended March
31, 1997 totaled $ 744,000, a $ 22,000 increase from the same period in 1996.
Factors contributing to this increase include an increase in the average
balance and average rate earned on taxable investment securities. The increase
in interest income was partially offset by an increase in the average balance
of time deposits. The overall effect of volume and rate changes on net interest
income during the first quarter of 1996 was favorable.
PROVISION FOR POSSIBLE LOAN LOSSES. The Company recorded no provision for
possible loan losses for both the first quarter of 1997 and 1996. 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 2.19% and 2.33% at March 31, 1997 and 1996,
respectively. The provision is determined by the level of net charge offs, the
size of the loan portfolio, the level of nonperforming loans, anticipated
economic conditions, and review of financial condition of specific customers.
NONINTEREST INCOME. There has been immaterial variances in noninterest
income for the three month periods ended March 31, 1997 and 1996. The $ 13,000
decrease in noninterest income for the first quarter of 1997 is the result of a
$ 10,000 decrease in total service charges on deposit account as compared to
the same period of 1996.
There were no securities gains in the first three months of 1996 or of 1995.
NONINTEREST EXPENSE. For the first three months of 1997 noninterest
expense decreased $ 9,000 or 1.6% compared to the same period in 1996.
Salaries and employee benefits , the largest component of noninterest expense,
increased by $ 3,000 or 1 % for the first three months of 1997 as compared to
the same period in 1996. Net occupancy expense and other expenses experienced
normal variations between the first quarter of 1997 and 1996.
INCOME TAXES. The Company recorded provisions for income taxes of
$105,000 in the first quarter of 1997 as compared to $ 18,000 in the first
quarter of 1996. Effective January 1, 1992, the company adopted Statement of
Financial Accounting Standard No. 109, "Accounting for Income Taxes." Due to
limitations related to the valuation of deferred tax assets, there was no
cumulative effect adjustment at adoption. During the first quarter of 1996 the
deferred tax valuation reserve was removed resulting in a reduction in the
income tax expense of $62,000.
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FINANCIAL CONDITION
LOANS. Loans were $ 27,011,000 at March 31, 1997; up by $ 965,000 or
3.7 % from March 31, 1996.
TABLE I - COMPOSITION OF LOAN PORTFOLIO
- ---------------------------------------
March 31, 1997 March 31, 1996
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Commercial, Financial and Agricultural $ 6,625 $ 5,932
Real Estate Construction 302 120
Real Estate Mortgage 15,743 15,957
Consumer Loans 4,486 4,017
Industrial Revenue Bonds 461 642
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TOTAL LOANS $ 27,617 $ 26,668
Allowance for possible loan losses 606 622
Unearned income 0 0
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$ 27,011 $ 26,046
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SECURITIES HELD TO MATURITY. Securities held to maturity were
$15,031,000 at March 31, 1997 ; down by $ 1,469,000 or 8.9 % from March 31,
1996.
SECURITIES AVAILABLE FOR SALE. Securities available for sale were
$10,212,000 at March 31, 1997; up by $ 4,277,000 or 72 % from March 31, 1996.
TABLE II - INVESTMENT SECURITIES
- --------------------------------
A comparison of the book value and estimated market value of investment
securities is as follows:
March 31, 1997
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HELD-TO-MATURITY AVAILABLE-FOR-SALE
AMORT MARKET AMORT MARKET
COST VALUE COST VALUE
U.S. Treasury $ 4,004 $ 3,989 $ 1,492 $ 1,497
U.S. Agencies 11,027 10,956 4,000 3,967
Mortgaged-backed securities 0 0 1,519 1,574
State & Political Subdivisions 0 0 3,191 3,174
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TOTAL $ 15,031 $ 14,945 $ 10,202 $ 10,212
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March 31, 1996
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HELD-TO-MATURITY AVAILABLE-FOR-SALE
AMORT MARKET AMORT MARKET
COST VALUE COST VALUE
U.S. Treasury $ 6,001 $ 6,037 $ 0 $ 0
U.S. Agencies 10,499 10,530 1,500 1,511
Mortgaged-backed securities 0 0 2,063 2,157
State & Political Subdivisions 0 0 2,259 2,267
-------- -------- -------- --------
TOTAL $ 16,500 $ 16,567 $ 5,822 $ 5,935
======== ======== ======== ========
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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.
March 31, 1997 March 31, 1996
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Non-Performing Loans:
Loans on Non-Accrual $ 443 $ 2
Restructured loans which are not
on nonaccrual 26 33
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Total nonperforming loans 469 35
Other Real Estate and repossessed assets
received in complete or partial
satisfaction of loan obligations 14 14
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TOTAL NONPERFORMING ASSETS $ 483 $ 49
============== ==============
Loans past due 90 days or more as to
principal or interest, but not on
non-accrual $ 3 $ 6
============== ==============
Nonperforming assets totaled $ 483,000 at March 31, 1997, a $ 434,000 (885.7 %)
increase.
TABLE IV - ANALYSIS OF ALLOWANCE FOR LOAN LOSSES
- ------------------------------------------------
March 31, 1997 March 31, 1996
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Beginning balance $ 614 $ 624
Charge-offs:
Commercial, financial and agricultural -- --
Real estate - construction -- --
Real estate - mortgage -- --
Installment loans to individuals 8 6
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Total charge-offs 8 6
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Recoveries:
Commercial, financial and agricultural -- 3
Real estate - construction -- --
Real estate - mortgage -- --
Installment loans to individuals -- 1
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Total recoveries 0 4
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Net charge-offs 8 2
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Provision charged against income -- --
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Balance at end of period $ 606 $ 622
============== ==============
Ratio of net charge-offs during the period to average loans
outstanding during the period .032% .008%
============== ==============
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.
March 31, 1997 March 31, 1996
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% OF LOANS % OF LOANS
TO TAL TO TAL
AMOUNT LOANS AMOUNT LOANS
----------------------------- ------------------------------
Commercial, financial and
agricultural $ 109 18% $ 137 22%
Real estate - construction 5 1% 6 1%
Real estate - mortgage 260 43% 373 60%
Installment loans 224 37% 93 15%
Industrial revenue bonds 8 1% 13 2%
---------- ----------
$ 606 100% $ 622 100%
========== ==========
DEPOSITS. As of March 31, 1997 total deposits have increased by
$5,029,000 or 9.8 % from March 31, 1996. Noninterest bearing deposits increased
by $ 1,938,000 or 13.2 % from March 31, 1996 to March 31, 1997. Interest
bearing deposits increased by $ 3,091,000 or 8.4 % from March 31, 1996 to March
31, 1997.
CAPITAL. Shareholders' equity totaled $ 7,848,000 at March 31, 1997,
compared to $ 7,066,000 at March 31, 1996. 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
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March 31,
-------------------
AMERICAN BANK & TRUST COMPANY 1997 1996
------ ------
Risk-based capital:
Tier 1 risk-based capital ratio 25.01% 23.77%
Total risk-based capital ratio 26.26% 25.02%
Leverage ratio 12.21% 11.78%
INSIDERS. Directors, executive officers and 10 % shareholders and their
related interest had loans outstanding totaling $ 1,465,000 at March 31, 1997.
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 the registrant.
AMERICAN BANCORP, INC.
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(Registrant)
May 6, 1997 /s/ Salvador L. Diesi
- --------------- ---------------------------------------
DATE Salvador L. Diesi
Chairman of the Board / President
May 6, 1997 /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