-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, NN1pLBFtvX/KXTXuW9la5uHhJHT/wOQ87sIoRJTlfDSJP/t3Jdv9Ie+foagg9j8I GyYdaYUVzyYbLoGAPo4rYw== 0000950109-97-006812.txt : 19971114 0000950109-97-006812.hdr.sgml : 19971114 ACCESSION NUMBER: 0000950109-97-006812 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970930 FILED AS OF DATE: 19971112 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: NATIONAL COMMERCE BANCORPORATION CENTRAL INDEX KEY: 0000101844 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 620784645 STATE OF INCORPORATION: TN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-06094 FILM NUMBER: 97713015 BUSINESS ADDRESS: STREET 1: ONE COMMERCE SQ CITY: MEMPHIS STATE: TN ZIP: 38150 BUSINESS PHONE: 9015233242 MAIL ADDRESS: STREET 1: ONE COMMERCE SQ CITY: MEMPHIS STATE: TN ZIP: 38150 FORMER COMPANY: FORMER CONFORMED NAME: UNITED TENNESSEE BANCSHARES CORP DATE OF NAME CHANGE: 19780820 FORMER COMPANY: FORMER CONFORMED NAME: UNITED TENNESSEE BANSHARES CORP DATE OF NAME CHANGE: 19780525 10-Q 1 FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------------------------- FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1997 Commission file number 0-6094 ------ NATIONAL COMMERCE BANCORPORATION -------------------------------- (Exact name of registrant as specified in its charter) Tennessee 62-0784645 ---------- ---------- (State or other jurisdiction (I.R.S. Employer of incorporation organization) Identification No.) One Commerce Square Memphis, Tennessee 38150 - ------------------- ----- (Address of principal executive offices) (Zip Code) Registrant's telephone number including area code - (901)523-3242 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 and 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 the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Common Stock, $2 par value -- 48,851,969 shares as of November 5, 1997 PART I. FINANCIAL INFORMATION - ------------------------------ Item 1. Financial Statements -------------------- NATIONAL COMMERCE BANCORPORATION Consolidated Balance Sheets -------------------------------- (In Thousands)
Sept. 30 Dec. 31 1997 1996 ---------- ---------- (unaudited) ASSETS ------ Cash and cash equivalents: Interest-bearing deposits with other banks $ 18,465 $ 17,789 Cash and non-interest bearing deposits 199,129 164,894 Federal funds sold and securities purchased under agreements to resell 16,570 13,219 ---------- ---------- Total cash and cash equivalents 234,164 195,902 ---------- ---------- Securities: Held-to-maturity 962,423 817,124 Available-for-sale 611,626 700,775 ---------- ---------- Total securities 1,574,049 1,517,899 ---------- ---------- Trading account securities 21,197 31,812 Loans: Commercial, financial and agricultural 470,950 469,604 Real estate - construction 218,661 168,556 Real estate - mortgage 759,112 598,277 Consumer 1,130,564 1,088,095 Lease financing 30,101 23,444 Unearned discounts (2,036) (3) ---------- ---------- Total loans 2,607,352 2,347,973 Less allowance for loan losses 39,911 35,514 ---------- ---------- Net loans 2,567,441 2,312,459 ---------- ---------- Premises and equipment, net 26,463 21,799 Broker/dealer customer receivables 14,009 11,699 Other assets 119,637 108,839 ---------- ---------- Total assets $4,556,960 $4,200,409 ========== ==========
See notes to consolidated financial statements. 1 Consolidated Balance Sheets (cont.) - ----------------------------------- (In Thousands)
Sept. 30 Dec. 31 1997 1996 ------------- ----------- (unaudited) LIABILITIES AND STOCKHOLDERS' EQUITY ------------------------------------ Liabilities: Deposits: Non-interest-bearing deposits $ 375,939 $ 352,676 Money market checking 259,271 275,471 Savings 80,022 79,599 Money market savings 955,331 970,838 Certificates of deposit less than $100,000 801,222 728,249 Certificates of deposit of $100,000 or more 500,112 569,597 ---------- ---------- Total deposits 2,971,897 2,976,430 ---------- ---------- Federal funds purchased and securities sold under agreements to repurchase 451,903 298,410 Broker/dealer customer payables 0 1,002 Accounts payable and accrued liabilities 157,401 59,064 Federal Home Loan Bank advances 424,837 396,109 Long-term debt 206,086 156,065 ---------- ---------- Total liabilities 4,212,124 3,887,080 ---------- ---------- Stockholders' equity: Common stock 97,893 48,770 Additional paid-in capital 58,789 61,763 Retained earnings 185,491 201,566 Unrealized gains (losses) on securities, net of taxes 2,663 1,230 ---------- ---------- Total stockholders' equity 344,836 313,329 Total liabilities and ---------- ---------- stockholders' equity $4,556,960 $4,200,409 ========== ==========
See notes to consolidated financial statements. 2 NATIONAL COMMERCE BANCORPORATION Consolidated Statements of Income -------------------------------- (Unaudited) (In Thousands, Except per Share Data)
For the three months For the nine months ended Sept. 30 ended Sept. 30 -------------------------- ------------------------- 1997 1996 1997 1996 -------- -------- ------- ------ Interest income: Loans $59,995 $48,747 $168,924 $138,889 Securities: Taxable 24,281 20,635 72,778 62,364 Non-taxable 1,870 1,904 5,621 5,867 Trading account securities 413 446 1,237 1,218 Deposits at banks 266 233 722 674 Other 313 455 712 1,103 ------- ------- -------- -------- Total interest income 87,138 72,420 249,994 210,115 ------- ------- -------- -------- Interest expense: Deposits: Money market savings 733 945 2,559 3,016 Savings 405 390 1,195 1,250 Money market savings 10,392 9,772 31,045 25,847 Certificates of deposit less than $100,000 11,229 9,570 31,562 27,741 Certificates of deposit $100,000 or more 7,375 7,535 22,953 20,855 Federal Home Loan Bank advances 6,215 6,284 17,466 18,113 Long-term debt 3,232 1,047 8,718 1,276 Federal funds purchased and securities sold under agreements to repurchase 6,402 3,483 16,476 12,462 ------- ------- -------- -------- Total interest expense 45,983 39,026 131,974 110,560 ------- ------- -------- -------- Net interest income 41,155 33,394 118,020 99,555 Provision for loan losses 4,280 4,149 11,285 11,444 ------- -------- -------- -------- Net interest income after provision for loan losses 36,875 29,245 106,735 88,111 ------- -------- -------- -------- Other income: Trust service income 2,409 2,200 6,763 6,549 Service charges on deposits 4,394 3,701 12,192 10,476 Other services charges and fees 4,086 3,234 10,941 7,639 Broker/dealer revenue 3,158 1,676 7,890 7,617 Securities gains (losses) 2 194 31 (38) Other income 5,963 7,843 18,640 20,425 ------- -------- -------- -------- Total other income 20,012 18,848 56,457 52,665 ------- -------- -------- --------
3 Consolidated Statements of Income (cont.) - ---------------------------------
For the three months For the nine months ended Sept. 30 ended Sept. 30 -------------------------- -------------------------- 1997 1996 1997 1996 ---- ---- ---- ---- Other expenses: Salaries and employee benefits 14,123 11,744 41,917 35,797 Occupancy expense 2,581 2,391 7,727 7,103 Furniture and equipment expenses 1,236 1,067 3,534 3,130 Other expenses 11,727 10,377 35,056 31,326 ------- ------- -------- -------- Total other expenses 29,667 25,579 88,234 77,356 ------- ------- -------- -------- Income before income taxes 27,220 22,514 74,958 63,420 Income taxes 9,175 7,789 25,689 21,656 ------- ------- -------- -------- Net income $18,045 $14,725 $ 49,269 $ 41,764 ======= ======= ======== ======== Net income per share of common stock $.36 $.30 $.97 $.83 Dividends per share of common stock $.11 $.10 $.33 $.29
See notes to consolidated financial statements. 4 NATIONAL COMMERCE BANCORPORATION Consolidated Statements of Cash Flows ------------------------------------- (Unaudited)
For the Nine Months Ended Sept. 30 ------------------------ 1997 1996 ---- ---- (In Thousands) Operating activities: Net income $49,269 $41,764 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Provision for loan losses 11,285 11,444 Provision for depreciation and amortization 3,884 2,839 Amortization of security premiums and accretion of discounts, net 28 6 Deferred income taxes (credit) (861) 945 (Increase) decrease in trading account securities 10,615 (5,406) Realized securities (gains) losses (31) 38 (Increase) decrease in broker/dealer customer receivables (2,310) 2,843 (Increase) decrease in interest receivable 3,260 496 (Increase) decrease in other assets (13,547) (22,553) Increase (decrease) in broker/dealer customer payables (1,002) (1,271) Increase (decrease) in interest payable 1,137 (662) Increase (decrease) in accounts payable and accrued expenses 98,728 13,727 -------- ------- Net cash provided by (used in) operating activities 160,455 44,210 -------- ------- Investing activities: Available for sale securities: Proceeds from the maturities of securities 168,886 168,279 Proceeds from sales of securities 79,987 274,464 Purchases of securities available for sale (128,655) (375,478) Purchases of securities held to maturity (174,019) (149,707) Net increase (decrease) in loans (266,267) (323,472) Purchase of premises and equipment (8,198) (3,685) -------- -------- Net cash provided by (used in) investing activities (328,266) (409,599) -------- -------- Financing activities: Net increase (decrease) in demand deposits, NOW accounts and savings accounts (8,021) 99,386 Net increase (decrease) in certificates of deposit 3,488 84,233 Net increase (decrease) in federal funds purchased and securities sold under agreements to repurchase 153,493 (105,884) Increase (decrease) in long-term debt 50,021 149,636 Increase (decrease) in Federal Home Loan Bank advances 28,728 (50,437) Proceeds from exercise of stock options 2,987 3,198 Issuance of common stock 53 3,583 Repurchases of common stock (8,481) (24,180) Cash dividends paid (16,195) (13,997) -------- -------- Net cash provided by (used in) financing activities 206,073 145,538 -------- -------- Decrease in cash and cash equivalents 38,262 (219,851) Cash and cash equivalents at beginning of period 195,902 387,755 -------- -------- Cash and cash equivalents at end of period $234,164 $167,904 ======== ======== Interest paid $130,837 $111,222 Income taxes paid $23,818 $22,549
5 NATIONAL COMMERCE BANCORPORATION -------------------------------- Notes to Consolidated Financial Statements ------------------------------------------ September 30, 1997 ------------------ (Unaudited) --------- Note A - Basis of Presentation - ------------------------------ The consolidated balance sheet at December 31, 1996 has been derived from the audited financial statements at that date. The accompanying unaudited interim consolidated financial statements reflect all adjustments (consisting only of normally recurring accruals) which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. The statements should be read in conjunction with the summary of accounting policies and notes to consolidated financial statements included in the Registrant's annual report for the year ended December 31, 1996. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted in accordance with the rules of the Securities and Exchange Commission. Note B - Securities Portfolio - ----------------------------- In accordance with FAS No. 115 "Accounting for Certain Investments in Debt and Equity Securities", as of September 30, 1997 the securities in the "Available for Sale" category included $4.37 million in unrealized gains. Accordingly, total securities and total stockholders' equity were increased by $4.37 million and $2.66 million (net of taxes), respectively, at September 30, 1997, to reflect the adjustment of the securities portfolio to market. The calculation of book value per share reflects these mark-to-market unrealized losses, whereas the calculation of ROA and ROE do not, because the unrealized gains are not included in net income. The fair value of the "Held to Maturity" category was $956.5 million at September 30, 1997. Note C - Floating Rate Capital Trust Pass-through Securities - ------------------------------------------------------------ In March, 1997, the Company issued $49,875,000 in Floating Rate Capital Trust Pass-through Securities ("Capital Securities"). The proceeds of this issue are being used by the Company for general corporate purposes and may be counted as Tier I capital. Note D - Effect of FASB Statement No. 128 - ----------------------------------------- In February 1997, the Financial Accounting Standards Board issued Statement No. 128, Earnings per Share, which is required to be adopted on December 31, 1997. At that time, the Company will be required to change the method currently used to compute earnings per share and to restate all prior periods. Under the new requirements for calculating primary earnings per share, the dilutive effect of stock options will be excluded. The impact of Statement 128 on the calculation of primary earnings per share and fully diluted earnings per share is not expected to be material. Note E - Effect of FASB Statement No. 131 - ----------------------------------------- In June 1997, the Financial Accounting Standards Board issued Statement No. 131, Disclosures about Segments of an Enterprise and Related Information. SFAS No. 131 establishes standards for the reporting of financial information from operating segments using the management approach in annual and interim financial statements. This Statement requires that financial information be reported on the basis that it is reported internally for evaluating segment performance and deciding how to allocate resources to segments. Because this Statement addresses how supplemental financial information is disclosed in annual and interim reports, the adoption will have no material impact on the financial statements. SFAS No. 131 will become effective in 1998. 6 Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS ------------------------------------------------------------ The purpose of this discussion is to focus on important factors affecting the Company's financial condition and results of operations. Reference should be made to the consolidated financial statements (including the notes thereto) for an understanding of the following discussion and analysis. In this discussion, net interest income and net interest margin are presented on a fully taxable equivalent basis. All per share data is adjusted to reflect all stock dividends and stock splits declared through September 30, 1997. This Form 10-Q may contain or incorporate by reference statements which may constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Prospective investors are cautioned that any such forward-looking statements are not guarantees for future performance and involve risks and uncertainties, and that actual results may differ materially from those comtemplated by such forward-looking statements. Important factors currently known to management that could cause actual results to differ materially from those in forward-looking statements include significant fluctuations in interest rates, inflation, economic recession, significant changes in the federal and state legal and regulatory environment, significant underperformance in the Company's portfolio of outstanding loans, and competition in the Company's markets. The Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future results over time. Financial Condition - ------------------- Following is a comparison of the September 30, 1997, and December 31, 1996, consolidated balance sheets. Total deposits decreased by $5 million or .2%, principally as a result of a $69 million or 12.2% decrease in certificates of deposit of $100,000 or more, a $16 million or 5.9% decrease in money market checking accounts, and a $16 million or 1.6% decrease in money market savings accounts. Partially offsetting these decreases, non-interest bearing deposits increased $23 million or 6.6% and certificates of deposit less than $100,000 increased $73 million or 10.0%. Federal funds purchased and securities sold under agreements to repurchase increased $153 million or 51.4% from year-end 1996 levels. This category of liabilities fluctuates with the availability of overnight funds purchased from downstream correspondent banks. Federal Home Loan Bank advances increased $29 million or 7.3% from December 31, 1996. This increase is principally the result of asset/liability management decisions related to the current interest rate environment. Long-term debt increased $50 million or 32.1%, reflecting management's decision to issue floating-rate Capital Trust Pass-through Securities in March, 1997. The proceeds of this issue are being used by the Company for general corporate purposes and may be counted as Tier 1 capital. Total loans, net of unearned discounts, increased by $259 million or 11.0% compared to December 31, 1996 levels. Commercial loans increased by $1 million or 0.3% and real estate construction loans increased by $50 million or 29.7%, reflecting current demand. Real estate mortgage loans increased by $161 million or 26.9%, reflecting an increased emphasis on promoting home equity loans. Consumer loans increased $42 million or 3.9%, while lease financing loans increased $7 million or 28.4% due to the Company's recent purchase of two leasing companies. Securities increased by $56 million or 3.7% from year-end 1996. Securities held to maturity increased by $145.3 million or 17.8%, and securities available for sale decreased $89.1 million or 12.7%, reflecting current portfolio investment strategies, and current market conditions. 7 Federal funds sold and securities purchased under agreements to resell increased by $3 million or 25.3% from December 31, 1996 levels, reflecting excess funds that otherwise were not employed in loans or securities at September 30, 1997. Trading account securities decreased by $11 million or 33.4% from year-end 1996 levels. This decrease reflects the trading activity generated by NBC Capital Markets, Group, Inc., the Company's broker/dealer subsidiary, which fluctuates from time to time. Broker/dealer customer receivables increased $2 million or 19.7% and payables decreased $1 million or 100.0% reflecting levels of activity. Results of Operations - --------------------- Three Months Ended September 30, 1997, Compared to Three Months Ended September 30, 1996 - ------------------------------------------------------------------------------- Net income was $18,045,000 for the third quarter of 1997, a 22.5% increase over the $14,725,000 reported for the same period a year earlier. Earnings per share were $.36, compared to $.30 per share in 1996, up 20.0%. Net interest income, the difference between interest earned on loans and investments and interest paid on interest-bearing liabilities, increased by $7,656,000 or 22.1% for the third quarter of 1997 compared to third quarter 1996. This increase reflects an $14,613,000 or 19.8% increase in total interest income that more than offsets a $6,957,000 or 17.8% increase in interest expense. Interest income increased in 1997 due to an increase of $581,632,000 or 15.9% in total average earning assets, and an increase in the yield on average earning assets from 8.00% in the third quarter of 1996 to 8.25% in the third quarter of 1997. The increased volume of earning assets positively impacted interest income by approximately $12,000,000, while the increased yield positively impacted interest income by approximately $2,600,000. Interest expense increased in the third quarter of 1997, reflecting an increase in average interest-bearing liabilities of $537,820,000 or 16.7%, and an increase in the cost of interest-bearing liabilities from 4.81% to 4.84%. The increase in the rate paid on interest-bearing liabilities had a minimal effect on interest expense, and the increase in average outstandings negatively affected interest expense by approximately $7,000,000. The net interest margin (taxable equivalent net interest income as a percentage of average earning assets) was 3.95% in third quarter 1997, compared to 3.76% in third quarter of 1996. The provision for loan losses in the third quarter of 1997 was $4,280,000, versus $4,149,000 for the third quarter of 1996. Net charge-offs were $2,479,000, or .38% of average loans compared to $1,797,000 or .33% of average loans in 1996. The allowance for loan losses totaled $39,911,000 at September 30, 1997, representing 1.53% of quarter-end net loans, compared to $34,827,000 or 1.55% of quarter-end net loans at September 30, 1996. Following is a comparison of non-earning assets and loans past due 90 days or more for the quarters ended September 30, 1997, June 30, 1997, and September 30, 1996 (dollars in thousands):
9-30-97 6-30-97 9-30-96 -------- -------- -------- Non-accrual loans 111 0 0 Renegotiated loans 0 0 0 Other real estate 34 0 0 --- -- ----- Total non-earning assets 145 0 0 === == ===== Loans past due 90 days or more 4,181 4,196 3,068
8 Percentage of total loans .16% .17% .14% Non-interest income, excluding securities transactions, totaled $20,010,000 for the quarter, an increase of $1,356,000, or 7.3%, from last year's third quarter. Included in third quarter, 1996 non-interest income was a pre-tax gain of $1.8 million relating to bank facilities. Excluding this gain, non-interest income increased $3,156,000 or 18.7% for the third quarter compared to third quarter 1996. The Company's broker/dealer revenue decreased $1,482,000 versus third quarter 1996, reflecting current market conditions. All other sources of non-interest income, including service charge income, trust service income, fuel card processing income, and supermarket sublicense income increased a net of $1,674,000 or 11.0%. Securities gains totaled $2,000 in third quarter 1997, compared to securities gains of $194,000 in third quarter 1996. Non-interest expenses (excluding the provision for loan losses) increased by $4,088,000 or 16.0% in third quarter, 1997, primarily reflecting increased employment and occupancy expenses relating to new products and locations and increased promotional expenses of new loan and deposit gathering campaigns. The Company's return on average assets and return on average equity were 1.60% and 21.38% respectively, for third quarter of 1997. These compared with 1996 third quarter returns of 1.52% and 19.98%, respectively. Nine Months Ended September 30, 1997, Compared to Nine Months Ended September 30, 1996 - -------------------------------------------------------------------------------- For the nine months ended September 30, 1997, net income totaled $49,269,000, a 18.0% increase over the $41,764,000 for the first nine months of 1996. Earnings per share were $.97, compared to $.83 for the same period in 1996, a 16.9% increase. For the nine-month period, return on average assets and return on average stockholders' equity were $1.50% and 19.95% respectively. These compared with 1996 nine month returns of 1.49% and 19.01%. Net interest income increased by $18,054,000 or 17.4% for the first nine months of 1997. This increase reflects a $39,468,000 or 18.4% increase in total interest income that more than offsets a $21,414,000,000 or 19.4% increase in interest expense. Interest income increased in 1997 due to an increase of $581,393,000 or 16.4% in total average earning assets and an increase in the yield on average earning assets from 8.06% in 1996 to 8.21% in 1997. The increased volume of earning assets positively impacted interest income by approximately $35,000,000, and the increased yield positively impacted interest income by approximately $4,000,000. Interest expense increased in the first nine months of 1997, reflecting an increase in average interest-bearing liabilities of $558,369,000 or 18.0%, with the cost of interest-bearing liabilities increasing from 4.77% to 4.82% in 1997. The increase in average outstandings negatively impacted interest expense by approximately $20,000,000 while the increased rate negatively impacted expense by approximately $1,500,000. The net interest margin was 3.94% in the first nine months of 1997, compared to 3.90% in the first nine months of 1996. The provision for loan losses for the first nine months of 1997 was $11,285,000, versus $11,444,000 for the first nine months of 1996. Net charge-offs were $7,513,000, compared to $5,224,000 in 1996. Non-interest income, excluding securities transactions, totaled $56,426,000 for the first nine months of 1997, compared to a total of $52,703,000 for the first nine months of 1996, an increase of 7.1%. Included in 1996 non-interest income was a $1.2 million gain on the sale of certain assets, primarily loans, of the Company's Commerce Finance subsidiary, and the previously mentioned $1.8 million gain relating to bank facilities transactions. Excluding these gains, non-interest income increased $6,723,000 or 13.5%. The Company's broker-dealer revenue increased $273,000 or 3.6%, reflecting current market conditions. Other sources of non-interest income, including service charge income, trust service income, fuel card processing income, supermarket sublicence income increased a net of $6,450,000 or 9 15.3%. Securities gains totaled $31,000 in 1997, compared to $38,000 in securities losses in 1996. Non-interest expenses (excluding the provision for loan losses) increased by $10,878,000 or 14.1% for the first nine months of 1997. Increased employment and occupancy expenses relating to new products and locations, and increased promotional expenses of new loan and deposit gathering campaigns were the primary reasons for the increase. Liquidity and Capital Resources - ------------------------------- Interest-bearing bank balances, federal funds sold, trading account securities, and securities available for sale are the principal sources of short-term asset liquidity. Other sources of short-term liquidity include federal funds purchased and repurchase agreements, credit lines with other banks, and borrowings from the Federal Reserve Bank and the Federal Home Loan Bank. Maturing loans and securities are the principal sources of long-term asset liquidity. Total realized stockholders' equity increased by $30,074,000 from December 31, 1996. Retained earnings accounted for the majority of the increase. Through September 30, 1997, 2,428,201 shares had been repurchased and cancelled under a stock repurchase program initiated in January, 1996 and are used to fund employee benefit plans. The following capital ratios do not include the effect of FAS No. 115 on Tier I capital, total capital, or total risk-weighted assets. As indicated in the following table, the Company and its banking subsidiaries exceeded all minimum required capital ratios for well-capitalized institutions at September 30, 1997.
9-30-97 6-30-97 9-30-96 ------- ------- ------- Total capital to risk-weighted assets 13.73% 13.91% 12.36% Tier I capital to risk-weighted assets 12.47% 12.65% 11.11% Tier I capital to assets (leverage ratio) 8.50% 8.58% 7.69%
10 PART II. OTHER INFORMATION - --------------------------- Item 6. Exhibits and Reports on Form 8-K --------------------------------- a. Exhibits 11. Computation of Earnings per Share 27. Financial Data Schedule b. Reports on Form 8-K The Registrant did not file any reports on Form 8-K during the quarter ended September 30, 1997. 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 hereunto duly authorized. NATIONAL COMMERCE BANCORPORATION (Registrant) By /s/ Lewis E. Holland --------------------------------- Lewis E. Holland Vice Chairman, Treasurer and Chief Financial Officer (Authorized Officer) (Principal Financial Officer) Date November 12, 1997 -------------------- 11 EX-11 2 COMPUTATION OF EARNINGS PER SHARE EXHIBIT 11. Computation of Earnings Per Share - -----------------------------------------------
In Thousands, Except Per Share Data ----------------------------------------------------- Three Months Ended Nine Months Ended Sept. 30 Sept. 30 --------------------- --------------------- 1997 1996 1997 1996 ------ ------ ------ ------ Primary Average shares outstanding 48,940 48,760 49,042 49,184 Less leveraged ESOP shares 0 (226) 0 (221) Net effect of the assumed exercise of stock options - based on the treasury stock method using average market price 1,732 1,248 1,601 1,156 ------ ------ ------ ------ Total 50,672 49,782 50,643 50,119 ====== ====== ====== ====== Net income $18,045 $14,725 $49,269 $41,764 Per share amount $.36 $.30 $.97 $.83 Fully Diluted: Average shares outstanding 48,940 48,760 49,042 49,184 Less leveraged ESOP shares 0 (226) 0 (221) Net effect of the assumed exercise of stock options - based on the treasury stock method using higher of quarter-end and average market price 1,858 1,294 1,644 1,261 ------ ------ ------ ------ 50,798 49,828 50,686 50,224 ====== ====== ====== ====== Net income $18,045 $14,725 $49,269 $41,764 Per share amount $.36 $.30 $.97 $.83
12 EX-27 3 FINANCIAL DATA SCHEDULE
9 1,000 9-MOS 9-MOS DEC-31-1997 DEC-31-1996 JAN-01-1997 JAN-01-1996 SEP-30-1997 SEP-30-1996 199,129 136,506 18,465 17,332 16,570 14,066 21,197 25,565 611,626 535,083 962,423 819,651 956,486 804,022 2,607,352 2,247,777 39,911 34,827 4,556,960 3,885,547 2,971,897 2,758,389 539,864 345,383 157,401 47,099 542,962 431,858 344,836 302,818 0 0 0 0 0 0 4,556,960 3,885,547 168,924 138,889 78,399 68,231 2,671 2,995 249,994 210,115 89,314 78,709 131,974 110,560 118,020 99,555 11,285 11,444 31 (38) 88,234 77,356 74,958 63,420 74,958 63,420 0 0 0 0 49,269 41,764 .97 .83 .97 .83 3.94 3.90 111 0 4,181 3,068 0 0 319 583 35,514 29,010 9,676 7,451 2,163 2,227 39,911 34,827 39,911 34,827 0 0 0 0
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