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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 29549
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FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1997
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 0-15956
Bank of Granite Corporation
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(Exact name of registrant as specified in its charter)
Delaware 56-1550545
- ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
Post Office Box 128, Granite Falls, N. C. 28630
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(704) 496-2000
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(Registrant's telephone number, including area code)
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(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 [ ]
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 practicable date.
Common stock, $1 par value
9,038,290 shares outstanding as of October 31, 1997
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Exhibit Index begins on page 13
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 1 of 14
2
Bank of Granite Corporation
Index
Begins
on Page
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Part I - Financial Information
Financial Statements:
Consolidated Balance Sheets
September 30, 1997 and December 31, 1996 3
Statements of Consolidated Income
Three Months Ended September 30, 1997 and 1996
And Nine Months Ended September 30, 1997 and 1996 4
Consolidated Statements of Cash Flows
Nine Months Ended September 30, 1997 and 1996 5
Notes to Consolidated Financial Statements 7
Management's Discussion and Analysis of
Financial Condition and
Results of Operations 8
PART II - Other Information 11
Signatures 12
Exhibit Index 13
Exhibit 27 - Financial Data Schedule 14
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 2 of 14
3
Bank of Granite Corporation
Consolidated Balance Sheets
(unaudited)
September 30, December 31,
1997 1996
------------- ------------
ASSETS:
Cash and cash equivalents:
Cash and due from banks $ 24,778,099 $ 24,336,258
Interest-bearing deposits 84,073 10,025
Federal funds sold -- 4,500,000
------------ ------------
Total cash and cash equivalents 24,862,172 28,846,283
------------ ------------
Investment Securities:
Available for sale, at fair value 51,777,912 51,195,230
Held to maturity, at amortized cost 77,562,252 77,449,108
Loans 346,807,858 320,280,400
Allowance for loan losses (5,179,577) (4,793,889)
------------ ------------
Net loans 341,628,281 315,486,511
------------ ------------
Premises and equipment, net 9,465,685 8,103,713
Accrued interest receivable 4,970,763 4,272,255
Other assets 2,109,774 2,196,756
------------ ------------
TOTAL $512,376,839 $487,549,856
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits:
Demand $ 78,878,596 $ 78,480,411
NOW accounts 61,878,205 60,575,240
Money market accounts 29,843,939 27,290,026
Savings 25,033,619 22,271,033
Time deposits of $100,000 or more 91,856,929 88,267,044
Other time deposits 125,904,858 120,814,237
------------ ------------
Total deposits 413,396,146 397,697,991
Securities sold under agreements to repurchase 4,921,843 2,955,234
Accrued interest payable 1,935,826 1,978,712
Other liabilities 717,620 1,611,805
------------ ------------
Total liabilities 420,971,435 404,243,742
------------ ------------
Shareholders' equity:
Common stock, $1 par value
Authorized: 10,000,000 shares
Issued and outstanding: 9,037,841 shares
in 1997 and 9,008,570 shares in 1996 9,037,841 9,008,570
Capital surplus 22,004,817 21,690,069
Retained earnings 60,040,436 52,430,332
Net unrealized gain on securities available
for sale, net of deferred income taxes 322,310 177,143
------------ ------------
Total shareholders' equity 91,405,404 83,306,114
------------ ------------
TOTAL $512,376,839 $487,549,856
============ ============
See notes to consolidated financial statements.
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 3 of 14
4
Bank of Granite Corporation
Statements of Consolidated
Income (unaudited)
Three Months Nine Months
Ended September 30, Ended September 30,
1997 1996 1997 1996
----------- ----------- ----------- -----------
INTEREST INCOME:
Interest and fees on loans $ 8,882,395 $ 7,861,018 $25,447,710 $23,063,382
Federal funds sold 20,064 42,559 126,381 226,454
Interest-bearing deposits 1,013 -- 1,961 --
Investments:
U.S. Treasury 307,041 319,667 901,489 843,689
U.S. Government agencies 532,853 636,290 1,686,203 1,819,340
States and political
subdivisions 826,386 761,407 2,425,766 2,245,811
Other 234,066 179,396 681,960 529,229
----------- ----------- ----------- -----------
Total interest income 10,803,818 9,800,337 31,271,470 28,727,905
----------- ----------- ----------- -----------
INTEREST EXPENSE:
Time deposits of
$100,000 or more 1,321,466 1,256,026 3,816,818 3,718,864
Other time and
savings deposits 2,410,511 2,337,729 7,008,083 6,863,682
Federal funds purchased and
securities sold under
agreements to repurchase 58,679 48,113 168,317 147,373
Other borrowed funds 149 355 876 1,204
----------- ----------- ----------- -----------
Total interest expense 3,790,805 3,642,223 10,994,094 10,731,123
----------- ----------- ----------- -----------
NET INTEREST INCOME 7,013,013 6,158,114 20,277,376 17,996,782
PROVISION FOR LOAN LOSSES 300,000 260,000 875,000 545,000
----------- ----------- ----------- -----------
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 6,713,013 5,898,114 19,402,376 17,451,782
----------- ----------- ----------- -----------
OTHER INCOME:
Service charges on
deposit accounts 776,614 795,194 2,364,900 2,279,787
Other service charges,
fees and commissions 326,193 242,349 925,367 749,049
Securities gains 3,695 23,059 3,695 38,098
Other 52,030 133,873 393,871 533,545
----------- ----------- ----------- -----------
Total other income 1,158,532 1,194,475 3,687,833 3,600,479
----------- ----------- ----------- -----------
OTHER EXPENSES:
Salaries and wages 1,308,997 1,147,682 3,801,685 3,437,564
Employee benefits 318,659 256,816 999,225 975,565
Occupancy expense, net 150,908 110,960 379,095 343,630
Equipment rentals,
depreciation, and
maintenance 249,261 222,114 694,069 625,364
Other 886,158 588,193 2,301,379 1,832,962
----------- ----------- ----------- -----------
Total other expenses 2,913,983 2,325,765 8,175,453 7,215,085
----------- ----------- ----------- -----------
INCOME BEFORE INCOME TAXES 4,957,562 4,766,824 14,914,756 13,837,176
INCOME TAXES 1,580,380 1,545,000 4,867,548 4,555,000
----------- ----------- ----------- -----------
NET INCOME $ 3,377,182 $ 3,221,824 $10,047,208 $ 9,282,176
=========== =========== =========== ===========
PER SHARE AMOUNTS:
Net income $ 0.37 $ 0.36 $ 1.11 $ 1.03
Cash dividends 0.09 0.09 0.27 0.26
Book value 10.11 8.95
See notes to consolidated financial statements.
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 4 of 14
5
Bank of Granite Corporation
Consolidated Statements of
Cash Flows (unaudited)
Nine Months
Ended September 30,
1997 1996
------------ ------------
Increase(decrease) in cash & cash equivalents:
Cash flows from operating activities:
Interest received $ 30,688,221 $ 28,368,778
Fees and commissions received 3,684,138 3,562,381
Interest paid (11,036,980) (10,734,489)
Cash paid to suppliers and employees (7,799,728) (7,386,772)
Income taxes paid (5,533,782) (4,876,797)
------------ ------------
Net cash provided by operating activities 10,001,869 8,933,101
------------ ------------
Cash flows from investing activities:
Proceeds from maturities and/or calls of
securities available for sale 12,819,317 13,100,001
Proceeds from maturities and/or calls of
securities held to maturity 8,299,238 10,527,779
Proceeds from sales of securities
available for sale 25,000 --
Purchase of securities available for sale (13,188,621) (16,328,877)
Purchase of securities held to maturity (8,520,934) (14,430,208)
Net increase in loans (27,016,770) (15,311,453)
Capital expenditures (1,994,889) (742,497)
Proceeds from sale of fixed assets 20,000 14,400
------------ ------------
Net cash used by investing activities (29,557,659) (23,170,855)
------------ ------------
Cash flows from financing activities:
Net increase in demand deposits, NOW accounts,
and savings accounts 7,017,649 9,734,556
Net increase in certificates of deposit 8,680,506 12,856,481
Net decrease(increase) in federal funds
purchased and securities sold under
agreements to repurchase 1,966,609 (73,485)
Net proceeds from issuance of common stock 344,019 322,341
Cash paid for fractional shares -- (17,413)
Dividend paid (2,437,104) (2,248,115)
------------ ------------
Net cash provided by financing activities 15,571,679 20,574,365
------------ ------------
Net increase(decrease) in cash equivalents (3,984,111) 6,336,611
Cash and cash equivalents at beginning of period 28,846,283 21,121,179
------------ ------------
Cash and cash equivalents at end of period $ 24,862,172 $ 27,457,790
============ ============
See notes to consolidated financial statements.
(continued on next page)
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 5 of 14
6
Bank of Granite Corporation
Consolidated Statements of
Cash Flows (unaudited) - (concluded)
Nine Months
Ended September 30,
1997 1996
----------- -----------
Reconciliation of net income to net cash provided
by operating activities:
Net Income $10,047,208 $ 9,282,176
----------- -----------
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 613,016 564,076
Provision for loan loss 875,000 545,000
Premium amortization, net 115,259 121,610
Gains on sales or calls of securities
available for sale (683) (23,059)
Gains on calls of securities
held to maturity (3,012) (15,039)
Loss(gain) on disposal or sale of equipment (99) 13,148
Decrease in taxes payable (666,234) (321,797)
Increase in accrued interest receivable (698,508) (480,737)
Decrease in interest payable (42,886) (3,366)
Increase in other assets (9,241) (1,205,226)
Increase(decrease) in other liabilities (227,951) 456,315
----------- -----------
Net adjustments to reconcile net income to
net cash provided by operating activities (45,339) (349,075)
----------- -----------
Net cash provided by operating activities $10,001,869 $ 8,933,101
=========== ===========
Supplemental disclosure of non-cash transactions:
Changes in net unrealized gains or losses on
securities available for sale $ 241,390 $ (623,229)
Securities purchased, not yet settled -- 1,000,000
Securities sold, not yet settled -- 48,059
Transfer from retained earnings to common stock
for stock split -- 3,000,827
See notes to consolidated financial statements.
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 6 of 14
7
Bank of Granite Corporation
Notes to Consolidated Financial Statements
September 30, 1997
1. In the opinion of management, the accompanying consolidated financial
statements contain all adjustments necessary to present fairly the financial
position of Bank of Granite Corporation as of September 30, 1997 and December
31, 1996, and the results of their operations for the three and nine month
periods ended September 30, 1997 and 1996, and their cash flows for the nine
month periods ended September 30, 1997 and 1996.
The accounting policies followed are set forth in Note 1 to the Corporation's
1996 Annual Report to Shareholders on file with the Securities and Exchange
Commission.
2. Earnings per share have been computed using the weighted average number of
shares of common stock and dilutive common stock equivalents outstanding, of
9,085,276 and 9,050,224, for the three month periods ended September 30, 1997
and 1996 respectively; and 9,080,217 and 9,036,126 for the nine month periods
ended September 30, 1997 and 1996 respectively.
3. In the normal course of business there are various commitments and contingent
liabilities such as commitments to extend credit, which are not reflected on the
financial statements. The unused portion of loan commitments at September 30,
1997 and December 31, 1996 was $58,201,000 and $56,138,000, respectively.
Additionally, standby letters of credit of approximately $2,943,882 and
$2,251,000 were outstanding at September 30, 1997 and December 31, 1996,
respectively. Management does not anticipate any significant losses to result
from these transactions.
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 7 of 14
8
Bank of Granite Corporation
Management's Discussion and Analysis
CHANGES IN FINANCIAL CONDITION
SEPTEMBER 30, 1997 COMPARED WITH DECEMBER 31, 1996
Total assets increased $24,826,983, or 5.09%, from December 31, 1996 to
September 30, 1997. Earning assets grew $22,797,332, or 5.03%, since December
31, 1996. Loans, the largest earning asset, rose $26,527,458, or 8.28%, for the
same period. Cash and cash equivalents fell $3,984,111, or 13.81%, from December
31, 1996 to September 30, 1997, primarily because of a $4,500,000 decrease in
Federal funds since year-end. Funding the asset growth was a combination of
deposit growth and earnings retained. Deposits were up $15,698,155, or 3.95%,
from December 31, 1996 to September 30, 1997 while earnings retained for the
period were $7,610,104 after paying dividends of 2,437,104. Noninterest-bearing
demand deposits increased slightly, while savings, NOW and money market deposits
increased $2,762,586, or 12.40%, during the nine month period ended September
30, 1997. Time deposits increased $8,680,506, or 4.15%, during the same period.
The loan to deposit ratio was 83.89% at September 30, 1997 compared to 80.53% at
December 31, 1996. Other liabilities decreased $894,185 from December 31, 1996
to September 30, 1997. Common stock outstanding increased 29,271 shares, or
0.32%, from December 31, 1996 to September 30, 1997, primarily due to the
exercise of stock options. The Company's liquidity position remained strong.
RESULTS OF OPERATIONS
FOR THE THREE MONTH PERIOD ENDED SEPTEMBER 30, 1997 COMPARED WITH THE SAME
PERIOD IN 1996 AND FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 1997 COMPARED
WITH THE SAME PERIOD IN 1996
During the three month period ended September 30, 1997, interest income
increased $1,003,481, or 10.24%, from the same period last year. The increase is
primarily attributable to increased loan volumes. The prime rate during the
three month period averaged 8.50% compared to 8.25% during the same period in
1996. Gross loans averaged $340,209,202 compared to 312,636,444 last year, an
increase of 8.82%. Interest expense increased $148,582, or 4.08%, primarily
because of growth in interest-bearing deposits.
During the nine month period ended September 30, 1997, interest income
increased $2,543,565, or 8.85%, from the same period last year. The increase is
primarily attributable to increased loan volumes. The prime rate during the nine
month period averaged 8.42% compared to 8.41% during the same period in 1996.
Gross loans averaged $333,274,027 compared to 303,359,180 last year, an increase
of 9.86%. Investment interest increased $257,349, or 4.73%, due to growth in the
investment portfolio. Interest expense increased $262,971, or 2.45%, primarily
because of growth in interest-bearing deposits.
Management determines the allowance for loan losses based on a number
of factors including reviewing and evaluating the Company's loan portfolio in
order to identify potential problem loans, credit concentrations and other risk
factors connected to the loan portfolio as well as current and projected
economic conditions locally and nationally. Upon loan origination, management
evaluates the relative quality of each loan and assigns a corresponding loan
grade. All loans are periodically reviewed to determine whether any changes in
these loan grades are necessary. The loan grading system assists management in
determining the overall risk in the loan portfolio.
(continued on next page)
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 8 of 14
9
Bank of Granite Corporation
Management's Discussion and Analysis
RESULTS OF OPERATIONS - (continued)
Management realizes that general economic trends greatly affect loan
losses and no assurances can be made that further charges to the loan loss
allowance may not be significant in relation to the amount provided during a
particular period or that further evaluation of the loan portfolio based on
conditions then prevailing may not require sizable additions to the allowance,
thus necessitating similarly sizable charges to operations. During the three and
nine month periods ended September 30, 1997, management determined a charge to
operations of $300,000 and $875,000, respectively, would bring the loan loss
reserve to an estimated balance considered to be adequate to absorb potential
losses in the portfolio. At September 30, 1997 the loan loss reserve was 1.52%
of net loans outstanding.
At September 30, 1997 and 1996, the recorded investment in loans that
are considered to be impaired under SFAS No. 114 was $1,235,664 ($918,216 of
which was on a non-accrual basis) and $1,265,992 ($625,486 which was on a
non-accrual basis), respectively. The average recorded balance of impaired loans
during 1997 and 1996 was not significantly different from the balance at
September 30, 1997 and 1996, respectively. The related allowance for loan losses
determined in accordance with SFAS No. 114 for these loans was $586,216 and
$779,724 at September 30, 1997 and 1996, respectively. For the nine months ended
September 30, 1997 and 1996, the Company recognized interest income on those
impaired loans of approximately $29,281 and $39,339, respectively.
For the quarter ended September 30, 1997, total noninterest income was
$1,158,532, a decrease of $35,943, or 3.01%, from $1,194,475 earned in the same
period of 1996. Fees on deposit accounts were $776,614 during the third quarter,
down $18,580, or 2.34%, from $795,194 earned in the third quarter of 1996. Third
quarter other service fees and commissions were $326,193 for 1997, up $83,844,
or 34.60%, from $242,349 earned in the same period of 1996. Gains on sales of
securities were $3,695 in 1997, down $19,364, or 83.98%, from $23,059 earned in
the same period of 1996. Other noninterest income was $52,030 for the third
quarter of 1997, down $81,843, or 61.13%, from $133,873 earned in the third
quarter of 1996. Management continued to emphasize non-traditional banking
services such as annuities, life insurance, leasing, and sales of mortgage and
small business loans, which produced $184,399, in non-interest income during the
quarter.
Third quarter 1997 noninterest expenses totaled $2,913,983, up
$588,218, or 25.29%, from $2,325,765 in the third quarter of 1996. Contributing
to the various overhead increases in the third quarter were costs associated
with (i) the opening of a new retail office that operates inside a grocery
store, (ii) the organizing of a department to launch a new cashflow management
product for commercial customers and (iii) the installation of and conversion to
new technology that captures items such as deposit tickets and checks as images
and reads the transaction information into the data processing system. Salaries
and wages were $1,308,997 during the quarter, up $161,315, or 14.06%, from
$1,147,682 in 1996. Profit sharing and employee benefits were $318,659, up
$61,843, or 24.08%, compared to $256,816 in the third quarter of 1996. Occupancy
expenses for the quarter were $150,908, up $39,948, or 36.00%, from $110,960 in
the same period of 1996. Equipment expenses were $249,261 during the third
quarter, up $27,147, or 12.22%, from $222,114 in the same period of 1996. Third
quarter other noninterest expenses were $886,158 in 1997, up $297,965, or
50.66%, from $588,193 in the same quarter a year ago. Income tax expense was
$1,580,380 for the quarter, up $35,380, or 2.29%, from $1,545,000 for the 1996
third quarter. Net income increased to $3,377,182 during the quarter, or 4.82%,
from $3,221,824 earned in the same period of 1996.
(continued on next page)
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 9 of 14
10
Bank of Granite Corporation
Management's Discussion and Analysis
RESULTS OF OPERATIONS - (concluded)
For the nine months ended September 30, 1997, total noninterest income
was $3,687,833, up $87,354, or 2.43%, from $3,600,479 earned in the same period
of 1996. Fees on deposit accounts were $2,364,900 during the first nine months
of 1997, up $85,113, or 3.73%, from $2,279,787 earned in the same period of
1996. Other service fees and commissions were $925,367 during the first nine
months of 1997, up $176,318, or 23.54%, from $749,049 earned in the same period
of 1996. Gains on sales of securities were $3,695 during the first nine months
of 1997, down $34,403, or 90.30%, from $38,098 earned in the same period of
1996. Other noninterest income was $393,871 during the first nine months of
1997, down $139,674, or 26.18%, from $533,545 earned in the same period of 1996.
Management's emphasis on non-traditional banking services such as annuities,
life insurance, leasing, and sales of mortgage and small business loans,
produced $645,526, in non-interest income during the period.
Total noninterest expenses were $8,175,453 during the first nine months
of 1997, up $960,368, or 13.31%, from $7,215,085 in the same period of 1996. As
was the case for the third quarter, the year-to-date increases in the various
overhead captions also included costs associated with (i) the opening of a new
retail office inside a high traffic grocery store, (ii) the organizing of a
department to launch a new cashflow management product for commercial customers
and (iii) the installation of and conversion to new imaging technology. Salaries
and wages were $3,801,685 during the first nine months of 1997, up $364,121, or
10.59%, from $3,437,564 in the same period of 1996. Profit sharing and employee
benefits were $999,225 during the first nine months of 1997, up $23,660, or
2.43%, from $975,565 in the same period of 1996. Occupancy expenses were
$379,095 during the first nine months of 1997, up $35,465, or 10.32%, from
$343,630 in the same period of 1996. Equipment expenses were $694,069 during the
first nine months of 1997, up $68,705, or 10.99%, from $625,364 in the same
period of 1996. Other noninterest expenses were $2,301,379 during the first nine
months of 1997, up $468,417, or 25.56%, from $1,832,962 in the same period of
1996. Income tax expense was $4,867,548 during the first nine months of 1997, up
$312,548, or 6.86%, from $4,555,000 in the same period of 1996. Net income was
$10,047,208 during the first nine months of 1997, up $765,032, or 8.24%, from
$9,282,176 earned in the same period of 1996.
COMPLETED ACQUISITION
On November 5, 1997, the Bank of Granite Corporation completed its
first acquisition. The Company acquired GLL & Associates, Inc., a mortgage bank,
in a stock-for-stock transaction that will be accounted for as a pooling of
interest. GLL & Associates, Inc. specializes in government-backed mortgages and
mortgages to first-time home buyers with offices in the Winston-Salem,
Charlotte, Greensboro, Statesville and High Point communities of North Carolina.
GLL & Associates originates in excess of $120 million in mortgages per year. As
of September 30, 1997, GLL & Associates had assets of approximately $11.5
million, including earning assets of approximately $10.8 million, substantially
all of which were mortgage loans. Liabilities assumed were approximately $10.7
million, of which $9.6 million were borrowings used to fund the mortgage loans.
FORWARD LOOKING STATEMENTS
The foregoing discussion may contain forward looking statements within
the meaning of the Private Securities Litigation Reform Act. The accuracy of
such forward looking statements could be affected by such factors as, including
but not limited to, the financial success or changing strategies of the
Company's customers, actions of government regulators, or general economic
conditions.
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 10 of 14
11
Bank of Granite Corporation
PART II - Other Information
Item 6 - Exhibits and Reports on Form 8-K
A) Exhibits
27 Financial Data Schedule (for SEC use only)
B) Reports on Form 8-K
No reports on Form 8-K have been filed for the quarter ended September 30,
1997.
Items 1,2,3,4 and 5 are inapplicable and are omitted.
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 11 of 14
12
Bank of Granite Corporation
Signatures
Pursuant to the requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
Bank of Granite Corporation
(Registrant)
Date: November 10, 1997 /s/ Kirby A. Tyndall
---------------------------
Kirby A. Tyndall
Senior Vice President and
Chief Financial Officer and
Principal Accounting Officer
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 12 of 14
13
Bank of Granite Corporation
Exhibit Index
Begins
on Page
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Exhibit 27 - Financial Data Schedule 14
Bank of Granite Corporation, Form 10-Q, September 30, 1997, page 13 of 14