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, 2003 Commission File Number 0-11172
FIRST CITIZENS BANCORPORATION OF SOUTH CAROLINA, INC.
-----------------------------------------------------
(Exact name of registrant as specified in its charter)
SOUTH CAROLINA 57-0738665
- ------------------------------- ---------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
1230 MAIN STREET
COLUMBIA, SOUTH CAROLINA 29201
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (803) 733-2659
--------------
NO CHANGE
- --------------------------------------------------------------------------------
(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 [ ]
Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). YES [X] NO [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at July 31, 2003
----- ----------------------------
VOTING COMMON STOCK, $5.00 PAR VALUE 871,392 SHARES
NON-VOTING COMMON STOCK, $5.00 PAR VALUE 36,409 SHARES
PART I - FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
FIRST CITIZENS BANCORPORATION OF SOUTH CAROLINA, INC. AND SUBSIDIARIES
- -------------------------------------------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF CONDITION - UNAUDITED (DOLLARS IN THOUSANDS, EXCEPT PAR VALUES)
JUNE 30, DECEMBER 31, JUNE 30,
2003 2002 2002
----------- -------------- -----------
ASSETS
Cash and due from banks $ 168,065 $ 165,747 $ 156,351
Federal funds sold 152,215 121,626 138,000
----------- -------------- -----------
Total cash and cash equivalents 320,280 287,373 294,351
----------- -------------- -----------
Investment securities:
Held-to-maturity, at amortized cost (fair value June 30, 2003-$28,441;
December 31, 2002-$35,268; and June 30, 2002-$22,677) 27,785 34,543 22,153
Available-for-sale, at fair value 895,145 881,327 932,432
----------- -------------- -----------
Total investment securities 922,930 915,870 954,585
----------- -------------- -----------
Gross loans 2,704,690 2,415,396 2,287,125
Less: Allowance for loan losses (48,120) (43,305) (40,740)
----------- -------------- -----------
Net loans 2,656,570 2,372,091 2,246,385
----------- -------------- -----------
Premises and equipment 119,954 110,472 104,207
Interest receivable 16,947 17,696 21,520
Intangible assets 65,825 45,478 44,809
Other assets 44,337 38,896 33,303
----------- -------------- -----------
TOTAL ASSETS $4,146,843 $ 3,787,876 $3,699,160
=========== ============== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Deposits:
Demand $ 660,173 $ 575,632 $ 564,082
Time and savings 2,913,502 2,700,376 2,555,754
----------- -------------- -----------
Total deposits 3,573,675 3,276,008 3,119,836
Securities sold under agreements to repurchase 151,570 130,360 211,312
Long-term debt 72,357 52,139 50,963
Other liabilities 28,414 25,785 26,081
----------- -------------- -----------
TOTAL LIABILITIES 3,826,016 3,484,292 3,408,192
----------- -------------- -----------
Commitments and contingencies -- -- --
STOCKHOLDERS' EQUITY:
Preferred stock 3,111 3,173 3,176
Non-voting common stock - $5.00 par value, authorized
1,000,000; issued and outstanding June 30, 2003,
December 31, 2002 and June 30, 2002 - 36,409 182 182 182
Voting common stock - $5.00 par value, authorized 2,000,000;
issued and outstanding June 30, 2003 - 871,392;
December 31, 2002 - 874,835; and June 30, 2002 - 884,040 4,357 4,374 4,420
Surplus 65,081 65,081 65,081
Undivided profits 229,706 211,264 197,286
Accumulated other comprehensive income, net of taxes 18,390 19,510 20,823
----------- -------------- -----------
TOTAL STOCKHOLDERS' EQUITY 320,827 303,584 290,968
----------- -------------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $4,146,843 $ 3,787,876 $3,699,160
=========== ============== ===========
SEE ACCOMPANYING NOTES TO THESE CONSOLIDATED FINANCIAL STATEMENTS.
Page 2
FIRST CITIZENS BANCORPORATION OF SOUTH CAROLINA, INC. AND SUBSIDIARIES
- ----------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
(DOLLARS IN THOUSANDS-EXCEPT PER SHARE DATA)
FOR THE FOR THE
QUARTER ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------ ------------------
2003 2002 2003 2002
-------- -------- -------- --------
INTEREST INCOME:
Interest and fees on loans $ 43,345 $ 41,659 $ 83,509 $ 83,631
Interest on investment securities:
Taxable 6,674 9,893 13,662 19,926
Non-taxable 133 151 275 315
Federal funds sold 593 868 1,219 1,668
-------- -------- -------- --------
Total interest income 50,745 52,571 98,665 105,540
-------- -------- -------- --------
INTEREST EXPENSE:
Interest on deposits 11,648 14,014 22,842 29,380
Interest on short-term borrowings 372 865 733 1,685
Interest on long-term debt 1,452 1,050 2,532 2,099
-------- -------- -------- --------
Total interest expense 13,472 15,929 26,107 33,164
-------- -------- -------- --------
Net interest income 37,273 36,642 72,558 72,376
Provision for loan losses 2,425 2,571 3,363 3,461
-------- -------- -------- --------
Net interest income after
provision for loan losses 34,848 34,071 69,195 68,915
-------- -------- -------- --------
NONINTEREST INCOME:
Service charges on deposits 9,084 7,650 17,025 14,676
Commissions and fees from fiduciary activities 846 802 1,657 1,652
Fees for other customer services 380 338 756 738
Mortgage income 1,257 454 2,866 1,347
Bankcard discount and fees 1,584 1,469 2,997 2,729
Insurance premiums 976 733 1,501 1,032
Gain on sale of investment securities 720 - 720 -
Other 540 657 1,071 1,128
-------- -------- -------- --------
Total noninterest income 15,387 12,103 28,593 23,302
-------- -------- -------- --------
NONINTEREST EXPENSE:
Salaries and employee benefits 17,628 15,884 34,388 30,138
Net occupancy expense 2,648 2,299 5,255 4,385
Furniture and equipment expense 1,665 1,442 3,245 2,860
Bankcard processing fees 1,673 1,512 3,183 2,881
Data processing fees 2,945 2,619 5,666 5,159
Professional services 298 294 610 798
Amortization expense 1,849 2,106 3,675 4,285
Other 5,541 5,201 10,307 10,099
-------- -------- -------- --------
Total noninterest expense 34,247 31,357 66,329 60,605
-------- -------- -------- --------
Income before income tax expense 15,988 14,817 31,459 31,612
Income tax expense 5,691 4,964 11,199 10,590
-------- -------- -------- --------
NET INCOME $ 10,297 $ 9,853 $ 20,260 $ 21,022
======== ======== ======== ========
NET INCOME PER COMMON SHARE -
BASIC AND DILUTED $ 11.28 $ 10.66 $ 22.19 $ 22.73
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING-BASIC AND DILUTED 908,855 920,449 909,224 921,226
SEE ACCOMPANYING NOTES TO THESE CONSOLIDATED FINANCIAL STATEMENTS.
Page 3
FIRST CITIZENS BANCORPORATION OF SOUTH CAROLINA, INC. AND SUBSIDIARIES
- --------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY AND ACCUMULATED OTHER COMPREHENSIVE INCOME - UNAUDITED
(DOLLARS IN THOUSANDS)
NON- ACCUMULATED TOTAL
VOTING VOTING OTHER STOCK-
PREFERRED COMMON COMMON UNDIVIDED COMPREHENSIVE HOLDERS'
STOCK STOCK STOCK SURPLUS PROFITS INCOME/(LOSS) EQUITY
----------- ------- -------- -------- ----------- --------------- ----------
Balance at December 31, 2001 $ 3,201 $ 182 $ 4,448 $ 65,081 $ 178,399 $ 19,604 $ 270,915
Comprehensive income:
Net income 21,022 21,022
Change in unrealized gain
on investment securities
available-for-sale, net of
taxes of $656 1,219 1,219
----------
Total comprehensive income 22,241
----------
Reacquired preferred stock (25) 8 (17)
Reacquired voting common stock (28) (1,613) (1,641)
Common stock dividends (448) (448)
Preferred stock dividends (82) (82)
----------- ------- -------- -------- ----------- --------------- ----------
Balance at June 30, 2002 3,176 182 4,420 65,081 197,286 20,823 290,968
Comprehensive income:
Net income 18,026 18,026
Change in unrealized gain
on investment securities
available-for-sale, net of
benefit of $707 (1,313) (1,313)
----------
Total comprehensive income 16,713
----------
Reacquired preferred stock (3) (11) (14)
Reacquired voting common stock (46) (3,505) (3,551)
Common stock dividends (449) (449)
Preferred stock dividends (83) (83)
----------- ------- -------- -------- ----------- --------------- ----------
Balance at December 31, 2002 3,173 182 4,374 65,081 211,264 19,510 303,584
Comprehensive income:
Net income 20,260 20,260
Change in unrealized gain
on investment securities
available-for-sale, net of
benefit of $603 (1,120) (1,120)
----------
Total comprehensive income 19,140
----------
Reacquired preferred stock (62) 21 (41)
Reacquired voting common stock (17) (1,320) (1,337)
Common stock dividends (437) (437)
Preferred stock dividends (82) (82)
----------- ------- -------- -------- ----------- --------------- ----------
Balance at June 30, 2003 $ 3,111 $ 182 $ 4,357 $ 65,081 $ 229,706 $ 18,390 $ 320,827
=========== ======= ======== ======== =========== =============== ==========
SEE ACCOMPANYING NOTES TO THESE CONSOLIDATED FINANCIAL STATEMENTS.
Page 4
FIRST CITIZENS BANCORPORATION OF SOUTH CAROLINA, INC. AND SUBSIDIARIES
- ----------------------------------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED (DOLLARS IN THOUSANDS)
FOR THE
SIX MONTHS ENDED
JUNE 30,
----------------------
2003 2002
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 20,260 $ 21,022
Adjustments to reconcile net income to net cash provided
by operating activities:
Provision for loan losses 3,363 3,461
Depreciation and amortization 10,909 8,838
Net (amortization of premium)/accretion of discount on
investment securities (355) 362
Deferred income tax benefit (1,942) (554)
(Gain) loss on sale of premises and equipment (146) 53
Decrease (increase) in accrued interest receivable 749 (1,509)
Increase (decrease) in accrued interest payable 1,533 (791)
Origination of mortgage loans held-for-resale (221,262) (130,220)
Proceeds from sales of mortgage loans held-for-resale 217,184 166,408
Gain on sales of mortgage loans held-for-resale (3,848) (761)
Gain on sale of investment securities (720) -
Decrease (increase) in other assets 3,956 (5,213)
(Decrease) increase in other liabilities (561) 3,047
---------- ----------
NET CASH PROVIDED BY OPERATING ACTIVITIES 29,120 64,143
========== ==========
CASH FLOWS FROM INVESTING ACTIVITIES:
Net increase in loans (93,069) (61,945)
Calls, maturities and prepayments of investment securities, held-to-maturity 15,882 3,041
Purchases of investment securities, held-to-maturity (4,520) (2,247)
Calls, maturities and prepayments of investment securities, available-for-sale 247,248 204,882
Purchases of investment securities, available-for-sale (248,103) (259,035)
Proceeds from sales of premises and equipment 83 90
Purchases of premises and equipment (11,020) (10,565)
(Increase) decrease in other real estate owned (467) 132
Increase in intangible assets (2,154) (26)
Purchase of institution, net of cash acquired (9,223) -
---------- ----------
NET CASH USED IN INVESTING ACTIVITIES (105,343) (125,673)
========== ==========
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase in deposits 89,817 104,882
Increase (decrease) in securities sold under agreements
to repurchase 21,210 (2,711)
Cash dividends paid (519) (530)
Cash paid to reacquire preferred stock (41) (17)
Cash paid to reacquire common stock (1,337) (1,641)
---------- ----------
NET CASH PROVIDED BY FINANCING ACTIVITIES 109,130 99,983
========== ==========
NET INCREASE IN CASH AND CASH EQUIVALENTS 32,907 38,453
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 287,373 255,898
---------- ----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 320,280 $ 294,351
========== ==========
Page 5
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A summary of the significant accounting policies of First Citizens
Bancorporation of South Carolina, Inc. ("Bancorporation") is set forth in Note 1
to the Consolidated Financial Statements in Bancorporation's Annual Report on
Form 10-K for 2002. The significant accounting policies used during the current
quarter are unchanged from those disclosed in the 2002 Annual Report.
BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been prepared
in accordance with accounting principles generally accepted in the United States
for interim financial preparation. In the opinion of management, all material
adjustments necessary to present fairly the financial position of Bancorporation
as and for each of the periods presented, and all adjustments comprising normal
recurring accruals necessary for a fair presentation of the consolidated
financial statements have been recorded. Certain amounts in prior periods have
been reclassified to conform to the 2003 presentation. Such reclassifications
had no effect on shareholders' equity or net income.
NEW ACCOUNTING STANDARDS
In June 2002, the FASB issued SFAS No. 147, "Acquisitions of Certain Financial
Institutions, an amendment of FASB Statements No. 72 and 144 and Interpretation
No. 9." Except for transactions between two or more mutual enterprises, this
Statement removes financial institutions from the scope of both Statement No. 72
and Interpretation 9 and requires that those transactions be accounted for in
accordance with SFAS No. 141 and 142. Additionally, this Statement amends SFAS
No. 144 to include in its scope long-term customer-relationship intangible
assets of financial institutions. Bancorporation adopted the Statement effective
October 1, 2002, and it did not have a material impact on Bancorporation's
financial position or results of operations.
In November 2002, the FASB issued FASB Interpretation No. 45, "Guarantor's
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others." The Interpretation elaborates on the
disclosures to be made by a guarantor in its financial statements under certain
guarantees that it has issued. It also clarifies that a guarantor is required to
recognize, at the inception of a guarantee, a liability for the fair value of
the obligation undertaken in issuing the guarantee. The disclosure requirements
of the Interpretation are effective and were adopted by Bancorporation as of
December 31, 2002, and require disclosure of the nature of the guarantee, the
maximum potential amount of future payments that the guarantor could be required
to make under the guarantee, and the current amount of the liability, if any,
for the guarantor's obligations under the guarantee. The recognition
requirements of the interpretation were effective beginning January 1, 2003. The
implementation of the recognition requirements of the Interpretation did not
have a significant effect on Bancorporation's consolidated financial position or
consolidated results of operations.
CRITICAL ACCOUNTING POLICIES
The accounting and reporting policies of Bancorporation and its subsidiaries are
in accordance with accounting principles generally accepted in the United States
and conform to general practices within the banking industry. Bancorporation's
financial position and results of operations are affected by management's
application of accounting policies, including judgments made to arrive at the
carrying value of assets and liabilities and amounts reported for revenues,
expenses and related disclosures including mortgage servicing rights and pension
accrual. Different assumptions in the application of these policies could result
in material changes in Bancorporation's consolidated financial position and/or
consolidated results of operations. The more critical accounting and reporting
policies include Bancorporation's accounting for securities, loans, the
allowance for loan losses, mergers and acquisitions and income taxes.
Bancorporation's accounting policies are fundamental to understanding
Management's Discussion and Analysis of Financial Condition and Results of
Operations. Accordingly, Bancorporation's significant accounting policies are
discussed in detail in Bancorporation's 2002 Annual Report on Form 10-K filed
with the Securities and Exchange Commission.
FORWARD-LOOKING STATEMENTS
This discussion may contain statements that could be deemed forward-looking
statements within the meaning of Section 21E of the Securities Exchange Act of
1934 and the Private Securities Litigation Reform Act, which statements are
inherently subject to risks and uncertainties. Forward-looking statements are
statements that include projections, predictions, expectations or beliefs about
future events or results, or otherwise are not statements of historical fact.
Such statements are often characterized by the use of the qualifying words (and
their derivatives) such as "expect," "believe," "estimate," "plan," "project,"
"anticipate," or other statements concerning opinions or judgments of
Bancorporation and its management about future events. Factors that could
influence the accuracy of such forward-looking statements include, but are not
limited to, the financial success or changing strategies of Bancorporations'
customers, actions of government regulators, the level of market interest rates,
and general economic conditions.
Page 6
GOODWILL AND OTHER INTANGIBLES (DOLLARS IN THOUSANDS)
In accordance with SFAS No.142, no goodwill amortization was recorded for the
quarter ended June 30, 2003. At June 30, 2003, the total carrying amount of
intangible assets not subject to amortization was $28,735. The discontinuation
of amortization of goodwill has had an immaterial effect on Bancorporation's
consolidated financial statements.
The following table relates to the carrying values of core deposit intangibles
recorded in Bancorporation's consolidated financial statements, all of which are
being amortized:
AS OF AS OF AS OF
JUNE 30, DECEMBER 31, JUNE 30,
2003 2002 2002
---------- -------------- ----------
CORE DEPOSIT INTANGIBLES:
Gross carrying value $ 106,620 $ 105,669 $ 102,387
Accumulated amortization (73,710) (70,034) (66,215)
---------- -------------- ----------
Balance at end of period $ 32,910 $ 35,635 $ 36,172
========== ============== ==========
Amortization expense on core deposit intangibles was $3,675 and $4,285 for the
six months ended June 30, 2003 and 2002, respectively. Amortization expense on
core deposit intangibles was $1,849 and $2,106 for the quarters ended June 30,
2003 and 2002, respectively.
Bancorporation projects the following aggregate amortization expense:
2003 $7,366
2004 $6,963
2005 $5,509
2006 $3,945
2007 $3,129
Mortgage servicing rights as of June 30, 2003, December 31, 2002 and June 30,
2002 were $4,180, $5,365, and $5,420, respectively. The amortization expense
related to mortgage servicing rights, included as a reduction of mortgage income
in the Consolidated Statements of Income, was $2,666 and $841 for the six months
ended June 30, 2003 and 2002, respectively. Amortization expense includes
$1,801 and $373 for impairment of mortgage servicing rights for the six months
ended June 30, 2003 and 2002, respectively. The amortization expense related to
mortgage servicing rights, included as a reduction of mortgage income in the
Consolidated Statements of Income, was $1,836 and $633 for the quarters ended
June 30, 2003 and 2002, respectively. Amortization expense includes $1,372 and
$373 for impairment of mortgage servicing rights for the quarters ended June 30,
2003 and 2002, respectively.
MERGERS AND ACQUISITIONS (DOLLARS IN THOUSANDS)
Effective April 1, 2003, First Citizens Bank and Trust Company of South Carolina
("First Citizens") acquired First Banks, Inc., a two-bank holding company
headquartered in Carnesville, Georgia, which is the parent company of First Bank
and Trust and The Bank of Toccoa (collectively "FBI"). The results of FBI's
operations have been included in the consolidated financial statements since
that date. The purpose of the acquisition was to expand First Citizens' banking
presence in Georgia. The total cost of the acquisition, recorded as a purchase,
was $59,110. The breakdown of the purchase price is as follows:
Cash $38,892
5 year First Citizens subordinated notes @ 7.50% 11,390
7 year First Citizens subordinated notes @ 7.75% 3,208
10 year First Citizens subordinated notes @ 8.00% 5,620
-------
$59,110
=======
Goodwill and other intangibles recorded in connection with this acquisition was
$24,534, of which $23,689 is not subject to amortization.
On June 30, 2003, First Citizens entered into a definitive agreement to acquire
four branches from an unrelated financial institution with estimated total
deposits of $71,300. The acquisition is expected to be completed during the
third or fourth quarter of 2003 pending regulatory approvals.
Page 7
SUBSEQUENT EVENTS
On July 30, 2003, Bancorporation's Board of Directors declared a $.35 dividend
on common stock to shareholders of record on August 15, 2003, payable August 25,
2003.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
RESULTS OF OPERATIONS
SUMMARY (DOLLARS IN THOUSANDS)
Net income for the quarter and six months ended June 30, 2003 totaled $10,297,
or $11.28 per common share and $20,260, or $22.19 per common share,
respectively. Net income for the quarter and six months ended June 30, 2002
totaled $9,853, or $10.66 per common share and $21,022, or $22.73 per common
share, respectively.
The primary factors affecting the increase in net income for the quarter ended
June 30, 2003 was a $3,284 or 27.13% increase in noninterest income, and a $631
or 1.72% increase in net interest income. These favorable changes were
partially offset by a $2,890 or 9.22% increase in noninterest expense. See
detailed discussion of components under "Net interest income" and "Noninterest
income and expense" below.
The primary factor affecting the decrease in net income for the six months ended
June 30, 2003 was a $5,724 or 9.44% increase in noninterest expense. This
unfavorable change was partially offset by a $5,291 or 22.71% increase in
noninterest income.
Return on average stockholders' equity and average assets are key measures of
earnings performance. Return on average stockholders' equity for the quarters
ended June 30, 2003 and June 30, 2002 was 12.99% and 13.90%, respectively.
Return on assets decreased from 1.07% for the quarter ended June 30, 2002 to
1.00% for the quarter ended June 30, 2003.
Return on average stockholders' equity for the six months ended June 30, 2003
and June 30, 2002 was 13.02% and 15.13%, respectively. Return on assets
decreased from 1.16% for the six months ended June 30, 2002 to 1.02% for the six
months ended June 30, 2003.
The decrease in return on average assets for both the quarter and six months
ended June 30, 2003 was primarily due to a decline in net interest margin to
average assets.
Individual components of net income are discussed further in the following
sections.
Page 8
Table 1 provides summary information on selected ratios, average and
year-to-date balances.
TABLE 1: SELECTED SUMMARY INFORMATION (DOLLARS IN THOUSANDS, EXCEPT PER SHARE
DATA) (UNAUDITED)
AS OF AND FOR THE AS OF AND FOR THE
QUARTER ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------------ ------------------------
SELECTED RATIOS: 2003 2002 2003 2002
----------- ----------- ----------- -----------
Return on average assets 1.00% 1.07% 1.02% 1.16%
Return on average stockholders' equity 12.99% 13.90% 13.02% 15.13%
Return on average common stockholders' equity 13.12% 14.06% 13.15% 15.30%
Yield on average interest-earning assets (tax
equivalent) 3.97% 4.36% 4.02% 4.37%
Average loans to average deposits 74.47% 72.43% 73.66% 72.66%
Nonperforming assets to total loans .29% .34% .31% .34%
Allowance for loan losses to total loans 1.78% 1.78% 1.78% 1.78%
Allowance for loan losses to nonperforming assets N/A N/A 6.17x 5.37x
Average stockholders' equity to average total
assets 7.70% 7.70% 7.87% 7.64%
Total stockholders' equity to total assets 7.74%% 7.87%% 7.74%% 7.87%%
Dividends per common share $ 0.25 $ 0.25 $ 0.50 $ 0.50
Total risk-based capital ratio 12.35% 12.94% 12.35% 12.94%
Tier I risk-based capital ratio 10.38% 11.68% 10.38% 11.68%
Tier I leverage ratio 7.14% 7.68% 7.14% 7.68%
SELECTED AVERAGE BALANCES:
Total assets $4,130,999 $3,690,772 $3,986,965 $3,668,093
Interest-earning assets 3,793,182 3,395,737 3,661,653 3,367,966
Investment securities 947,474 946,180 929,595 927,102
Loans 2,648,775 2,247,930 2,528,331 2,244,930
Deposits 3,556,858 3,103,648 3,432,336 3,089,656
Noninterest-bearing deposits 634,456 537,590 604,321 522,468
Interest-bearing deposits 2,922,402 2,566,058 2,828,015 2,567,188
Interest-bearing liabilities 3,149,516 2,840,224 3,040,634 2,837,940
Stockholders' equity 318,033 284,230 313,831 280,181
SELECTED YEAR-TO-DATE BALANCES:
Total assets $4,146,843 $3,699,160 $4,146,843 $3,699,160
Interest-earning assets 3,779,835 3,379,710 3,779,835 3,379,710
Investment securities 922,930 954,585 922,930 954,585
Loans 2,704,690 2,287,125 2,704,690 2,287,125
Deposits 3,573,675 3,119,836 3,573,675 3,119,836
Noninterest-bearing deposits 660,173 564,082 660,173 564,082
Interest-bearing deposits 2,913,502 2,555,754 2,913,502 2,555,754
Interest-bearing liabilities 3,137,429 2,818,029 3,137,429 2,818,029
Stockholders' equity 320,827 290,968 320,827 290,968
Page 9
NET INTEREST INCOME (DOLLARS IN THOUSANDS)
Net interest income represents the principal source of earnings for
Bancorporation. Tables 2 and 3 compare average balance sheet items and analyze
net interest income on a tax equivalent basis for the quarters and six months
ended June 30, 2003 and 2002.
TABLE 2: COMPARATIVE AVERAGE BALANCE SHEETS AND TAXABLE EQUIVALENT RATE/VOLUME VARIANCES (DOLLARS IN THOUSANDS)
AS OF AND FOR THE QUARTER ENDED JUNE 30,
----------------------------------------
INTEREST YIELD/ CHANGE DUE TO (2)
AVERAGE BALANCE INCOME/EXPENSE (1) RATE ----------------- NET
---------------------- ---------------------- ------------ YIELD INCREASE
2003 2002 2003 2002 2003 2002 /RATE VOLUME (DECREASE)
---------- ---------- -------- ------------ ----- ----- ---------- ---------- -----------
INTEREST-EARNING ASSETS:
Loans (3) $2,648,775 $2,247,930 $ 43,522 $ 41,858 6.59% 7.47% $ (4,940) $ 6,604 $ 1,664
Investment securities:
Taxable 933,869 933,768 6,674 9,893 2.87 4.25 (3,220) 1 (3,219)
Non-taxable 13,605 12,412 205 233 6.03 7.51 (46) 18 (28)
Federal funds sold 196,933 201,627 593 868 1.21 1.73 (261) (14) (275)
---------- ---------- -------- ------------ ----- ----- ---------- ---------- -----------
Total interest-earning assets 3,793,182 3,395,737 50,994 52,852 5.39 6.24 (8,467) 6,609 (1,858)
---------- ---------- -------- ------------ ---------- ---------- -----------
NONINTEREST-EARNING ASSETS:
Cash and due from banks 138,957 132,663
Premises and equipment 118,228 103,763
Other, less allowance for
loan losses 80,632 58,609
---------- ----------
Total noninterest-earning
assets 337,817 295,035
---------- ----------
TOTAL ASSETS $4,130,999 $3,690,772
========== ==========
INTEREST-BEARING LIABILITIES:
Deposits $2,922,402 $2,566,058 $ 11,648 $ 14,014 1.60% 2.19% $ (3,791) $ 1,425 $ (2,366)
Securities sold under
agreements to repurchase 154,757 223,203 372 865 0.96 1.55 (329) (164) (493)
Long-term debt 72,357 50,963 1,452 1,050 8.03 8.24 (27) 429 402
---------- ---------- -------- ------------ ----- ----- ---------- ---------- -----------
Total interest-bearing
liabilities 3,149,516 2,840,224 13,472 15,929 1.72 2.25 (4,147) 1,690 (2,457)
---------- ---------- -------- ------------ ----- ----- ---------- ---------- -----------
NONINTEREST-BEARING
LIABILITIES:
Demand deposits 634,456 537,590
Other liabilities 28,994 28,728
---------- ----------
Total noninterest-bearing
liabilities 663,450 566,318
---------- ----------
TOTAL LIABILITIES 3,812,966 3,406,542
---------- ----------
Stockholders' equity 318,033 284,230
---------- ----------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $4,130,999 $3,690,772
========== ==========
NET INTEREST SPREAD 3.67% 3.99%
===== =====
NET INTEREST MARGIN: $ 37,522 $ 36,923 $ (4,320) $ 4,919 $ 599
======== ============ ========== ========== ===========
TO AVERAGE ASSETS 3.64% 4.01%
===== =====
TO AVERAGE INTEREST-
EARNING ASSETS 3.97% 4.36%
===== =====
(1) Non-taxable interest income has been adjusted to a taxable equivalent rate,
using the federal income tax rate of 35%.
(2) Yield/rate-volume changes have been allocated to each category based on the
percentage of each to the total change.
(3) Nonaccrual loans are included in the average loan balances. Interest income
on nonaccrual loans is generally recognized on a cash basis.
Page 10
TABLE 3: COMPARATIVE AVERAGE BALANCE SHEETS AND TAXABLE EQUIVALENT RATE/VOLUME VARIANCES (DOLLARS IN THOUSANDS)
AS OF AND FOR THE SIX MONTHS ENDED JUNE 30,
-------------------------------------------
INTEREST YIELD/ CHANGE DUE TO (2)
AVERAGE BALANCE INCOME/EXPENSE (1) RATE ----------------- NET
---------------------- ---------------------- ------------ YIELD INCREASE
2003 2002 2003 2002 2003 2002 /RATE VOLUME (DECREASE)
---------- ---------- -------- ------------ ----- ----- ---------- ---------- -----------
INTEREST-EARNING ASSETS:
Loans (3) $2,528,331 $2,244,930 $ 83,879 $ 84,055 6.69% 7.55% $ (9,656) $ 9,480 $ (176)
Investment securities:
Taxable 916,850 914,162 13,662 19,926 3.00 4.40 (6,304) 40 (6,264)
Non-taxable 12,745 12,940 423 484 6.64 7.48 (55) (6) (61)
Federal funds sold 203,727 195,934 1,219 1,668 1.21 1.72 (496) 47 (449)
---------- ---------- -------- ------------ ----- ----- ---------- ---------- -----------
Total interest-earning
assets 3,661,653 3,367,966 99,183 106,133 5.46 6.35 (16,511) 9,561 (6,950)
---------- ---------- -------- ------------ ---------- ---------- -----------
NONINTEREST-EARNING ASSETS:
Cash and due from banks 141,753 141,782
Premises and equipment 114,786 100,816
Other, less allowance for
loan losses 68,773 57,529
---------- ----------
Total noninterest-earning
assets 325,312 300,127
---------- ----------
TOTAL ASSETS $3,986,965 $3,668,093
========== ==========
INTEREST-BEARING
LIABILITIES:
Deposits $2,828,015 $2,567,188 $ 22,842 $ 29,380 1.63% 2.31% $ (8,664) $ 2,126 $ (6,538)
Securities sold under
agreements to repurchase 149,822 219,789 733 1,685 0.99 1.55 (606) (346) (952)
Long-term debt 62,797 50,963 2,532 2,099 8.06 8.24 (44) 477 433
---------- ---------- -------- ------------ ----- ----- ---------- ---------- -----------
Total interest-bearing
liabilities 3,040,634 2,837,940 26,107 33,164 1.73 2.36 (9,314) 2,257 (7,057)
---------- ---------- -------- ------------ ----- ----- ---------- ---------- -----------
NONINTEREST-BEARING
LIABILITIES:
Demand deposits 604,321 522,468
Other liabilities 28,179 27,504
---------- ----------
Total noninterest-bearing
liabilities 632,500 549,972
---------- ----------
TOTAL LIABILITIES 3,673,134 3,387,912
---------- ----------
Stockholders' equity 313,831 280,181
---------- ----------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $3,986,965 $3,668,093
========== ==========
NET INTEREST SPREAD 3.73% 3.99%
===== =====
NET INTEREST MARGIN: $ 73,076 $ 72,969 $ (7,197) $ 7,304 $ 107
======== ============ ========== ========== ===========
TO AVERAGE ASSETS 3.70% 4.01%
===== =====
TO AVERAGE INTEREST-
EARNING ASSETS 4.02% 4.37%
===== =====
(1) Non-taxable interest income has been adjusted to a taxable equivalent rate,
using the federal income tax rate of 35%.
(2) Yield/rate-volume changes have been allocated to each category based on the
percentage of each to the total change.
(3) Nonaccrual loans are included in the average loan balances. Interest income
on nonaccrual loans is generally recognized on a cash basis.
Page 11
NET INTEREST INCOME (CONTINUED)
CURRENT QUARTER COMPARED TO PRIOR YEAR QUARTER
- ----------------------------------------------
Net interest income on a tax equivalent basis increased $599 or 1.62% for the
quarter ended June 30, 2003, over the comparable period in 2002. Net interest
margin to average assets decreased from 4.01% for the quarter ended June 30,
2002 to 3.64% for the quarter ended June 30, 2003. This is primarily
attributable to a 39 basis point decrease in the net interest margin to average
interest-earning assets.
Net interest margin to average interest-earning assets decreased from 4.36% for
the quarter ended June 30, 2002 to 3.97% for the quarter ended June 30, 2003.
This was primarily attributable to a decrease in the net interest spread from
3.99% for the quarter ended June 30, 2002 to 3.67% for the quarter ended June
30, 2003. The decrease in the net interest spread was due to yields on
interest-earning assets declining more than the cost of interest-bearing
liabilities. The yield on interest-earning assets decreased from 6.24% for the
quarter ended June 30, 2002 to 5.39% for the quarter ended June 30, 2003, or by
85 basis points, while the cost of interest-bearing liabilities decreased from
2.25% to 1.72%, or by 53 basis points. The decrease in the yield on
interest-earning assets was due to a decrease in the yields on loans, investment
securities and federal funds sold. The decrease in the cost of interest-bearing
liabilities was due to a decrease in the rates paid on interest-bearing deposits
and securities sold under agreements to repurchase. The decrease in yields on
interest-earning assets has occurred as rates have declined significantly on new
loans added to replace those that were refinanced or prepaid, and on investments
that have matured or have been called. The decrease in rates paid on
interest-bearing deposits is primarily due to a decline in rates paid on new and
matured time deposits.
CURRENT YEAR-TO-DATE PERIOD COMPARED TO PRIOR YEAR-TO-DATE PERIOD
- -----------------------------------------------------------------
Net interest income on a tax equivalent basis increased $107 or .15% for the six
months ended June 30, 2003, over the comparable period in 2002. Net interest
margin to average assets decreased from 4.01% for the six months ended June 30,
2002 to 3.70% for the six months ended June 30, 2003. This is primarily
attributable to a 35 basis point decrease in the net interest margin to average
interest-earning assets.
Net interest margin to average interest-earning assets decreased from 4.37% for
the six months ended June 30, 2002 to 4.02% for the six months ended June 30,
2003. This was primarily attributable to a decrease in the net interest spread
from 3.99% for the six months ended June 30, 2002 to 3.73% for the six months
ended June 30, 2003. The decrease in the net interest spread was due to yields
on interest-earning assets declining more than the cost of interest-bearing
liabilities. The yield on interest-earning assets decreased from 6.35% for the
six months ended June 30, 2002 to 5.46% for the six months ended June 30, 2003,
or by 89 basis points, while the cost of interest-bearing liabilities decreased
from 2.36% to 1.73%, or by 63 basis points. The decrease in the yield on
interest-earning assets was due to a decrease in the yields on loans, investment
securities and federal funds sold. The decrease in the cost of interest-bearing
liabilities was due to a decrease in the rates paid on interest-bearing deposits
and securities sold under agreements to repurchase. The decrease in yields on
interest-earning assets has occurred as rates have declined significantly on new
loans and investments added to replace those that were refinanced or prepaid,
and on investments that have matured or have been called. The decrease in rates
paid on interest-bearing deposits is primarily due to a decline in rates paid on
new and matured time deposits.
NONINTEREST INCOME AND EXPENSE (DOLLARS IN THOUSANDS)
CURRENT QUARTER COMPARED TO PRIOR YEAR QUARTER
- ----------------------------------------------
Noninterest income increased by $3,284 or 27.13% for the quarter ended June 30,
2003, over the comparable period in 2002 primarily due to increases in service
charges on deposits, mortgage income and gain on sale of investment securities.
The increase in service charges on deposits was primarily due to an increase in
non-sufficient funds ("NSF") fees over the comparable period in 2002, which
account for $927 of the $1,434 increase. Mortgage income increased by $803, or
176.87%, due to a $1,857 increase in the gain on sale of mortgage loans. The
increase in mortgage income was partially offset by an increase of $999 in
impairment recorded on mortgage servicing rights during the second quarter of
2003. Impairment of mortgage servicing rights totaled $1,372 during the quarter
ended June 30, 2003, compared to $373 during the quarter ended June 30, 2002.
The increase in impairment during the quarter is due to higher prepayment
assumptions on mortgage loans serviced by Bancorporation. Higher prepayment
speeds have resulted as mortgage rates have continued to decline in the current
interest rate environment. The gain on sale of investment securities for the
quarter ended June 30, 2003 was $720. There were no gains on sale of investment
securities for the quarter ended June 30, 2002.
Page 12
Noninterest expense increased by $2,890, or 9.22%, for the quarter ended June
30, 2003 over the comparable period in 2002 primarily due to increases in
salaries and employee benefits, net occupancy expense and data processing
expense. Salaries and employee benefits increased by $1,744, or 10.98%, during
the quarter primarily due to an increase in the number of employees and merit
increases. New employees have been added due to acquisitions and continued
expansion of lines of business. Net occupancy expense increased by $349, or
15.18%. The increase is due to $305 additional depreciation expense related to
four branches purchased after the quarter ended June 30, 2002 and on-going
growth. Data processing expense increased $326, or 12.45%, during the quarter
primarily due to increased transaction volume related to the on-going growth of
Bancorporation. These increases were partially offset by a decrease in
amortization of intangibles of $257, or 12.20%, primarily due to the run off of
core deposit intangibles related to former acquisitions.
CURRENT YEAR-TO-DATE PERIOD COMPARED TO PRIOR YEAR-TO-DATE PERIOD
- -----------------------------------------------------------------
Noninterest income increased by $5,291 or 22.71% for the six months ended June
30, 2003, over the comparable period in 2002 primarily due to increases in
service charges on deposits, mortgage income and gain on sale of investment
securities. The increase in service charges on deposits was primarily due to an
increase in NSF fees over the comparable period in 2002, which accounted for
$1,495 of the $2,349 increase. Mortgage income increased by $1,519, or 112.77%,
due to a $3,087 increase in the gain on sale of mortgage loans. The increase in
mortgage income was partially offset by an increase in impairment recorded on
mortgage servicing rights totaling $1,428. The gain on sale of investment
securities for the six months ended June 30, 2003 was $720. There were no gains
on sale of investment securities for the six months ended June 30, 2002.
Noninterest expense increased by $5,724, or 9.44%, for the six months ended June
30, 2003 over the comparable period in 2002 primarily due to increases in
salaries and employee benefits, net occupancy expense and data processing
expense. Salaries and employee benefits increased by $4,250, or 14.10%, during
the six months ended June 30, 2003 primarily due to an increase in the number of
employees and merit increases. New employees have been added due to
acquisitions and continued expansion of lines of business. Net occupancy
expense increased by $870, or 19.84%. The increase is due to $545 additional
depreciation expense related to four branches purchased after the six months
ended June 30, 2002 and on-going growth. Data processing expense increased $507,
or 9.83%, during the six months ended primarily due to the on-going growth
realized by Bancorporation. The increase was partially offset by a decrease in
amortization of intangibles of $610, or 14.24%, primarily due to the run off of
core deposit intangibles related to former acquisitions.
INCOME TAXES (DOLLARS IN THOUSANDS)
Total income tax expense increased by $727 or 14.65% for the quarter ended June
30, 2003 over the comparable period in 2002. Total income tax expense increased
by $609 or 5.75% for the six months ended June 30, 2003 over the comparable
period in 2002. The effective tax rate was 35.60% and 33.50% for the quarters
and six months ended June 30, 2003 and June 30, 2002, respectively.
Page 13
FINANCIAL CONDITION
INVESTMENT SECURITIES (DOLLARS IN THOUSANDS)
As of June 30, 2003, the investment portfolio totaled $922,930, compared to
$954,585 at June 30, 2002. Bancorporation continues to invest primarily in
short-term U.S. government obligations and agency securities to minimize credit,
interest rate and liquidity risks. The investment portfolio consisted of 92.46%
and 93.07% U.S. government and agency securities as of June 30, 2003 and June
30, 2002, respectively. The remainder of the investment portfolio consists of
municipal bonds, corporate bonds, and equity securities.
LOANS AND THE ALLOWANCE FOR LOAN LOSSES (DOLLARS IN THOUSANDS)
As of June 30, 2003, loans totaled $2,704,690, compared to $2,287,125 at June
30, 2002, an increase of $417,565, or 18.26%. Of the increase, $183,783 was due
to the acquisition of FBI on April 1, 2003. The remainder was due to internal
loan growth. The composition of the loan portfolio has not shifted
significantly since June 30, 2002. Internal loan growth was funded through core
deposits and short-term borrowed funds.
It is the policy of Bancorporation to maintain an allowance for loan losses to
absorb potential losses inherent in the loan portfolio. Management believes
that the provision taken during the quarter and six months ended June 30, 2003
was appropriate to provide an allowance for loan losses which considers the past
experience of charge-offs, the level of past due and nonaccrual loans, the size
and mix of the loan portfolio, credit classifications and general economic
conditions in Bancorporation's market areas.
An analysis of activity in the allowance for loan losses as of June 30, 2003 and
2002 is presented below. The allowance for loan losses is maintained through
charges to the provision for loan losses. Loan charge-offs and recoveries are
charged or credited directly to the allowance for loan losses.
AS OF AND FOR THE AS OF AND FOR THE
QUARTER ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
---------------------- -----------------------
ALLOWANCE FOR LOAN LOSSES: 2003 2002 2003 2002
----------- --------- ---------- -----------
Balance at beginning of period $ 43,304 $ 39,722 $ 43,305 $ 40,259
Addition related to acquisitions 3,776 -- 3,776 --
Provision for loan losses 2,425 2,571 3,363 3,461
----------- --------- ---------- -----------
Charge-offs (1,796) (1,923) (3,257) (3,799)
Recoveries 411 370 933 819
----------- --------- ---------- -----------
Net charge-offs (1,385) (1,553) (2,324) (2,980)
----------- --------- ---------- -----------
Balance at end of period $ 48,120 $ 40,740 $ 48,120 $ 40,740
----------- --------- ---------- -----------
Nonperforming assets $ 7,793 $ 7,591 $ 7,793 $ 7,591
Annualized net charge-offs to:
Average loans .21% .28% .18% .27%
Loans at end of period .20% .27% .17% .26%
Allowance for loan losses 11.51% 15.25% 9.66% 14.63%
FUNDING SOURCES (DOLLARS IN THOUSANDS)
Bancorporation's primary source of funds is its deposit base. Total deposits
increased $453,839 or by 14.55% from June 30, 2002 to June 30, 2003. Of the
increase, $208,969 was due to the acquisition of FBI on April 1, 2003. The
remainder was due to internal deposit growth. Average deposits were $3,432,336
and $3,089,656 at June 30, 2003 and June 30, 2002, respectively.
Short-term borrowings in the form of securities sold under agreements to
repurchase are another source of funds. Short-term borrowings decreased $59,742
or 28.27% from June 30, 2002 to June 30, 2003. Average short-term borrowings
were $149,822 and $219,789 at June 30, 2003 and June 30, 2002, respectively.
Page 14
CAPITAL RESOURCES (DOLLARS IN THOUSANDS)
Regulatory agencies define capital as Tier I, consisting of stockholders' equity
less ineligible intangible assets, and Total Capital, consisting of Tier I
Capital plus the allowable portion of the allowance for loan losses and certain
long-term debt.
Regulatory guidelines require a minimum ratio of total capital to risk-adjusted
assets of 8 percent, with at least 50 percent consisting of tangible common
stockholders' equity and a minimum Tier I leverage ratio of 3 percent. Banks
which meet or exceed a Tier I ratio of 6 percent, a total capital ratio of 10
percent, and a Tier I leverage ratio of 5 percent are considered
well-capitalized by regulatory standards. The following table details
Bancorporation's capital ratios at June 30, 2003 and 2002.
CAPITAL RATIOS JUNE 30,
----------------------
2003 2002
------ ------
Tier I leverage ratio 7.14% 7.68%
Total risk-based capital ratio 12.35% 12.94%
Tier I 10.38% 11.68%
Tier II 1.97% 1.26%
The Board of Directors each year authorizes management to repurchase outstanding
shares of its capital stock. Purchases are subject to various conditions,
including price and volume limitations (including, in the case of repurchases of
Bancorporation's voting common stock, an annual limit of up to 5% of outstanding
shares), and compliance with applicable South Carolina law. Pursuant to similar
authority during the six months ended June 30, 2003 and 2002, Bancorporation
repurchased an aggregate of 3,443 and 5,500 shares, respectively, of its
outstanding voting common stock, for an aggregate price of $1,337 and $1,641,
respectively. With respect to other classes of Bancorporation's capital stock,
aggregate repurchases during the six months ended June 30, 2003 and 2002 totaled
1,242 and 487 shares, respectively, for an aggregate price of $41 and $17,
respectively. Repurchases of shares during both periods had an immaterial
impact on Bancorporation's capital.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There have been no material changes in market risk exposures that affect the
quantitative and qualitative disclosures presented as part of Bancorporation's
Annual Report on Form 10-K for the year ended December 31, 2002.
ITEM 4. CONTROLS AND PROCEDURES
(a) Evaluation of Disclosure Controls and Procedures
Bancorporation's Chief Executive Officer and Chief Financial Officer, after
evaluating the effectiveness of Bancorporation's "disclosure controls and
procedures" (as defined in the Securities Exchange Act of 1934 rules
13a-15(e) and 15d-15(e)) as of the end of the period covered by this
quarterly report have concluded that Bancorporation's disclosure controls
and procedures were effective in timely alerting them to material
information relating to Bancorporation which were required to be included
in periodic SEC filings.
(b) Changes in Internal Controls
There were no changes in Bancorporation's internal control over financial
reporting that occurred during our most recent fiscal quarter that has
materially affected, or is reasonably likely to materially affect,
Bancorporation's internal control over financial reporting.
Page 15
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Not Applicable.
ITEM 2. CHANGES IN SECURITIES
Not Applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The annual meeting of shareholders of Registrant was held on April 30, 2003. At
the meeting, Shareholders voted to elect 18 directors for terms of one year or
until their respective successors are duly elected and qualified. The 18
Nominees, listed below, were elected as Directors for a term of 1 year.
Nominees For Withheld Broker Non-Votes
- -------------------- ------- -------- ----------------
C.H. Ames 850,416 694 234
J.B. Apple 850,219 1,125 -
R.W. Blackmon 850,290 729 325
P.M. Bristow 850,650 694 -
G.H. Broadrick 845,538 729 5,077
W.C. Cottingham 850,290 729 325
D.E. Dukes 850,615 729 -
W.E. Hancock, III 850,650 694 -
R.B. Haynes 850,653 691 -
W.E. Haynes 850,559 694 91
L.M. Henderson 850,416 694 234
F.B. Holding 845,772 729 4,843
D.H. Jordan 850,290 729 325
C.S. McLaurin, III 850,559 694 91
N.W. Morrisette, Jr. 850,290 729 325
E.P. Palmer 850,290 729 325
W.E. Sellars 845,538 729 5,077
H.F. Sherrill 845,629 729 4,986
No other matters were voted on at the meeting, and there was no solicitation in
opposition to management's Nominees listed in the Proxy Statement.
ITEM 5. OTHER INFORMATION
Not Applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits - The following exhibits are either attached hereto or
incorporated by reference:
11 Statement re computation of per share earnings (filed
herewith).
31.1 Certification of Chief Executive Officer required by
Rule 13a-14(a) (filed herewith)
31.2 Certification of Chief Financial Officer required by
Rule 13a-14(a) (filed herewith)
32 Certification (Pursuant to 18 U.S.C. Section 1350)
(filed herewith)
Page 16
(b) The following Form 8-K's were filed or furnished during the
quarter ended June 30, 2003.
Form 8-K furnished on April 30, 2003, reporting that
Bancorporation had announced its results of operations for the
quarter ended March 31, 2003.
Form 8-K filed on July 1, 2003, reporting that Bancorporation's
bank subsidiary had entered into a definitive agreement as of
June 30, 2003 to acquire four branches from an unrelated
financial institution.
Page 17
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.
FIRST CITIZENS BANCORPORATION
OF SOUTH CAROLINA, INC.
(Registrant)
Dated: August 13, 2003
By: /s/ Craig L. Nix
-----------------------
Craig L. Nix
Chief Financial Officer
Page 18
EXHIBIT INDEX
11 Statement of Re Computation of Net Income per Share
31.1 Certification of Chief Executive Officer required by Rule
13a-14(a) (filed herewith)
31.2 Certification of Chief Financial Officer required by Rule
13a-14(a) (filed herewith)
32 Certification (Pursuant to 18 U.S.C. Section 1350)