FORM F-4
Quarterly Report Under Section 13 of the Securities Exchange Act
of 1934
for the Quarter ended March 31, 1996
FDIC Insurance Certificate Number 32995
Granville United Bank
(Exact name of bank specified in Charter)
North Carolina
(State of Incorporation)
56-1634590
(I.R.S. Employer Identification No.)
109 Hillsboro Street
Oxford, North Carolina 27565
(Address of principal executive office)
(919) 693-9000
(Bank's telephone No.)
Indicate by check mark whether the bank (1) has filed all reports required to be
filed by Section 13 of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the bank was requires to file such
reports), and (2) has been subject to such filing requirements for the last 90
days.
YES XX NO
Number of Shares of Common Stock, $5 Par Value,
outstanding as of March 31, 1996: 430,000
GRANVILLE UNITED BANK
BALANCE SHEET
March 31, December 31,
1996 1995
Assets
Cash and due from banks $ 1,793,834 $ 1,890,435
Interest-bearing deposits with banks 299,721 399,664
Federal funds sold 2,065,000 315,000
Securities available for sale (at market value) 29,545,920 32,248,510
Investment securities (held to maturity), market
value of $784,500 in 1996 and $793,000 in 1995 753,849 753,701
Loans less allowances for credit losses of
$284,380 in 1996 and $282,424 in 1995 23,508,413 21,800,270
Properties and equipment, net 625,748 645,408
Accrued income 837,080 715,572
Other assets 662,411 641,642
------------------ ------------------
$ 60,091,976 $ 59,410,202
================== ==================
Liabilities and Shareholders' Equity
Liabilities
Demand deposits 5,087,395 5,121,324
Savings and NOW deposits 18,223,268 17,910,258
Large denomination time deposits 8,408,102 7,920,567
Other time deposits 21,610,840 21,627,713
------------------ ------------------
Total deposits 53,329,605 52,579,862
Accrued interest payable 234,133 240,506
Other liabilities 220,884 294,705
------------------ ------------------
53,784,622 53,115,073
Commitments and contingencies
Shareholders' equity
Common stock, $5 par value; 2,000,000 shares
authorized; 430,000 shares issued 2,150,000 2,150,000
Surplus 2,539,223 2,539,223
Retained earnings 1,438,699 1,275,633
Unrealized depreciation on investment securities
available for sale, net of income taxes 179,432 330,273
------------------ ------------------
6,307,354 6,295,129
------------------ ------------------
$ 60,091,976 $ 59,410,202
================== ==================
GRANVILLE UNITED BANK
STATEMENTS OF INCOME
For the three months ending March 31, 1996 and 1995
1996 1995
-------------------- -------------------
Interest income:
Loans and fees on loans $ 535,112 $ 398,764
Federal funds sold 6,001 16,192
Interest on investment securities:
Taxable 494,675 357,239
Exempt from federal income tax 9,779 8,566
Deposits with other financial institutions 7,483 18,055
-------------------- -------------------
1,053,050 798,816
-------------------- -------------------
Interest expense:
Large denomination certificates of deposit 119,790 73,271
Other deposits 425,814 346,685
Federal fund purchased 2,285 2,217
Total interest expense 547,889 422,173
-------------------- -------------------
Net interest income 505,161 376,643
Provision for credit losses 2,500 0
-------------------- -------------------
Net interest income after provision
for credit losses 502,661 376,643
-------------------- -------------------
Other income:
Service charges on deposit accounts 57,222 38,882
Other service charges and fees 5,019 2,486
Other Income 8,921 26,962
-------------------- -------------------
Total other income 71,162 68,330
-------------------- -------------------
Other expense:
Salaries 155,456 144,023
Employee benefits 31,913 27,942
Occupancy expense 20,529 16,389
Loss on sale of bonds 127 4,298
Equipment expense 19,374 23,515
Other expense 107,821 144,208
-------------------- -------------------
Total other expense 335,220 360,375
-------------------- -------------------
Income before taxes 238,603 84,598
Income tax expense 75,537 27,223
-------------------- -------------------
Net income $ 163,066 $ 57,375
==================== ===================
Net income per share $ 0.38 $ 0.13
==================== ===================
GRANVILLE UNITED BANK
STATEMENTS OF CASH FLOWS
For the three months ending March 31, 1996 and 1995
1995 1994
----------------- -----------------
Cash flows from operating activities:
Net income $ 163,066 57,375
Adjustments to reconcile net income
to net cash provided by operations:
Depreciation 19,660 20,664
Provision for credit losses (2,500) 0
Deferred income taxes 0 0
Net investment securities gains (loss) 127 4,298
Accretion of discount on securities, net of
amortization of premiums 5,131 10,228
Changes in assets and liabilities:
Deferred loan income 8,399 15,238
Accrued income and other assets (142,277) (897,254)
Accrued interest payable and other liabilities (2,488) 99,583
----------------- -----------------
Net cash provided by operating activities 49,118 (689,868)
----------------- -----------------
Cash flows from investing activities:
Net increase (decrease) in interest-bearing
deposits in banks (57) (164)
Net increase (decrease) in federal funds sold (1,750,000) (1,223,010)
Proceeds from maturity of time deposits with
other financial institutions 100,000 0
Purchase of investments securities, available-for-sale (999,141) (2,018,125)
Purchase of investments securities, held to maturity 0 (10,255,854)
Proceeds from sale/maturity of investments securities,
available-for sale 3,467,778 495,277
Proceeds form sale/maturity of investment securities,
held to maturity 0 0
Net increase in loans (1,714,042) (2,656,360)
Capital expenditures, bank premises and equipment 0 (383,003)
----------------- -----------------
Net cash provided (used) by investing activities (895,462) (16,041,239)
----------------- -----------------
Cash flows from financing activities
Net increase in demand, savings and NOW 279,081 2,852,743
Net increase (decrease) in time deposits 470,662 12,978,865
Proceeds from sale of common stock 0 1,300,000
----------------- -----------------
Net cash provided by financing activities 749,743 17,131,608
----------------- -----------------
Net increase in cash and cash equivalents (96,601) 400,501
Cash and cash equivalents, beginning 1,890,435 1,540,926
----------------- -----------------
Cash and cash equivalents, ending $ 1,793,834 $ 1,941,427
================= =================
Supplemental disclosure of cash flow information:
Interest paid $ 554,262 $ 352,486
================= =================
Taxes paid $ 143,337 $ 44,907
================= =================
Unrealized gain (loss) on securities
available for sale $ 271,867 $ (35,282)
================= =================
GRANVILLE UNITED BANK
Statements of changes in Shareholders' Equity
For the three months ending March 31, 1996 and 1995
Unrealized
Depreciation
On Securities
Common Stock Retained Available
Shareholders' for Total
Shares Amount Surplus Earnings Sale Equity
Balance - January 1, 1995 330,000 1,650,000 1,739,223 806,247 - 4,195,470
Net income 57,375 - 57,375
----------- ------------- ------------- --------------- --------------- -------------
Common Stock issued
under stock purchase 100,000 500,000 800,000 1,300,000
Unrealized appreciation on
investment securities, available-
for-sale, net of income taxes - - - - (23,286) (23,286)
----------- ------------- ------------- --------------- --------------- -------------
Balance March 31, 1995 430,000 2,150,000 2,539,223 863,622 (23,286) 5,529,559
=========== ============= ============= =============== =============== =============
Balance January 1, 1996 430,000 2,150,000 2,539,223 1,275,633 330,273 6,295,129
Net income - - - 163,066 - 163,066
----------- ------------- ------------- --------------- --------------- -------------
Unrealized appreciation on
investment securities, available-
for-sale, net of income taxes - - - - (150,841) (150,841)
----------- ------------- ------------- --------------- --------------- -------------
Balance March 31, 1996 430,000 2,150,000 2,539,223 1,438,699 179,432 6,307,354
=========== ============= ============= =============== =============== =============
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF
FINANCIAL CONDITION AND RESULT OF OPERATIONS
During the first quarter of 1996, assets were $60,091,976 compared to
$59,410,202 on December 31, 1995 an increase of $681,774. During the same
period, total deposits increased by $749,743 while loans increased by
$1,708,143.
Net profits for the first three months of 1996 were $163,066 compared
to a profit of $57,375 during the first three months of 1995. On a per share
basis, profits during the three month period ending March 31, 1996 were $.38
compared to a profit of $.13 in 1995 during the same period. The bank
transferred $2,500 to loan loss reserve in 1996 whereas no transfers were made
during the same quarter in 1995.
As noted loan growth increased by $1,708,143 during the first quarter
of 1996. Management plans to continue growth in loans and will strive to
maintain loans as its primary earning asset.
During 1995 Granville United Bank acquired deposits from a Branch
Banking & Trust branch in Butner, North Carolina and deposits from a Southern
National Bank branch located in Creedmoor, North Carolina. A full service branch
was opened in Creedmoor on February 21, 1995. The bank's acquisition created
additional expenses in 1995 thus lowering first quarter earnings. In 1996 the
bank incurred expenses related to a data processor conversion. However, these
expenses were minimal compared to the acquisition cost during the first quarter
of 1995.
Granville United Bank's capital to asset ratio was 10.50 at the end of
the first. The return on average assets for the three month period was .27%.
Signatures
Pursuant to the requirements of the Securities and Exchange Act of
1934, this Bank has duly caused this Registration Statement to be signed on its
behalf by the undersigned thereunto duly authorized.
Granville United Bank
Date: May 14, 1995 By: /s/ Billy N. Quick, Sr.
Billy N. Quick, Sr.
President and CEO
By: /s/ Lionel B. Burnette
Lionel B. Burnette
Senior