-----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, Kyd/eLiYJ/THkqC57k0HULHMmzks4ttgdPV2QZY0jvaSZBm8By5eSidY0Immv9Cf 4s/nHeSg5bgGgnYJ12f6Pw== 0000904280-98-000238.txt : 19980810 0000904280-98-000238.hdr.sgml : 19980810 ACCESSION NUMBER: 0000904280-98-000238 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980630 FILED AS OF DATE: 19980807 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ROCKY FORD FINANCIAL INC CENTRAL INDEX KEY: 0001031517 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 841413346 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-22441 FILM NUMBER: 98679087 BUSINESS ADDRESS: STREET 1: 801 SWINK AVENUE CITY: ROCKY FORD STATE: CO ZIP: 81067 BUSINESS PHONE: 7192547642 MAIL ADDRESS: STREET 1: 801 SWINK AVENUE CITY: ROCKY FORD STATE: CO ZIP: 81067 10QSB 1 U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB [ X ] Quarterly Report under Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended June 30, 1998 Commission File Number: 333-20489 Rocky Ford Financial, Inc. - ---------------------------------------------------------------- (Exact Name of Small business Issuer as Specified in Its Charter) Delaware 84-1413346 - ------------------------------- ----------------- (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification Number) 801 Swink Avenue, Rocky Ford, Colorado 81067 - ----------------------------------------------------------------- (Address of Principal Executive Offices) 719-254-7642 - ----------------------------------------------------------------- (Issuer's Telephone Number, Including Area Code) Check whether the issuer's: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 ---- ---- State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: Shares of common stock outstanding as of June 30, 1998 423,200 ROCKY FORD FINANCIAL, INC. CONTENTS PART I - FINANCIAL INFORMATION Item 1: Financial Statements Consolidated Statement of Condition at June 30, 1998 and September 30, 1997 3 Statements of Consolidated Income for the Three Months and Nine Months Ended June 30, 1998 and 1997 4 Statements of Consolidated Cash Flows for the Nine Months Ended June 30, 1998 and 1997 5 Notes to Financial Statements 6 - 7 Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations 8 - 10 PART II - OTHER INFORMATION Item 1: Legal Proceedings 11 Item 2: Changes in Securities 11 Item 3: Defaults Upon Senior Securities 11 Item 4: Submission of Matters to a Vote of Security Holders 11 Item 5: Other Information 11 Item 6: Exhibits and Reports on Form 8-K 11 Signature 11 2 ROCKY FORD FINANCIAL, INC. CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (UNAUDITED)
June 30, September 30, 1998 1997 ---------- ------------ ASSETS Cash and cash equivalents Interest - bearing $ 3,000,000 $ 2,900,000 Non-interest bearing 233,286 305,382 Certificates of deposit 1,602,277 1,999,312 Securities available for sale Equity securities (amortized cost of $11,327) 544,419 409,218 Securities held to maturity Mortgage-backed securities (estimated market value of $2,044,700 and $2,629,000) 1,953,388 2,421,308 U.S. agencies (estimated market value of $753,650 and $743,000) 749,141 748,965 Loans receivable - net 13,959,706 13,529,566 Federal Home Loan Bank stock, at cost 342,400 323,500 Retirement trust assets 251,687 251,687 Accrued interest receivable 137,451 146,769 Premises and equipment 79,067 83,270 Prepaids 26,244 45,910 ----------- ----------- TOTAL ASSETS $22,879,066 $23,164,887 =========== =========== LIABILITIES AND EQUITY Deposits $15,574,065 $16,139,404 Advances from borrowers for taxes and insurance 21,527 35,562 Accounts payable and accrued expenses 342,125 372,700 Current income taxes 50,020 - Deferred income taxes 221,895 169,400 ----------- ----------- TOTAL LIABILITIES 16,209,632 16,717,066 ----------- ----------- Commitments and contingencies Preferred stock - $.01 par value; authorized 1,000,000 shares; no shares issued or outstanding - - Common stock-$.01 par value; authorized 3,000,000 shares; issued and outstanding 423,200 4,232 4,232 Paid-in capital 3,841,628 3,830,582 Retained earnings - substantially restricted 2,787,886 2,700,923 Net unrealized gain on securities available for sale, net of tax of $197,270 and $147,240 335,821 250,644 Note receivable from ESOP Trust (300,133) (338,560) ----------- ----------- TOTAL EQUITY 6,669,434 6,447,821 ----------- ----------- TOTAL LIABILITIES AND EQUITY $22,879,066 $23,164,887 =========== ===========
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 3 ROCKY FORD FINANCIAL, INC. CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Three Months Ended Nine Months Ended June 30, June 30, --------------------- -------------------- 1998 1997 1998 1997 ---------- --------- -------- -------- INTEREST INCOME Loans receivable $298,989 $291,880 $ 883,195 $ 838,550 Securities held 58,341 80,725 187,092 202,725 Other interest-bearing assets 68,154 63,785 207,283 180,860 -------- -------- ---------- ---------- TOTAL INTEREST INCOME 425,484 436,390 1,277,570 1,222,135 INTEREST ON DEPOSITS 189,766 214,530 576,122 627,806 -------- -------- ---------- ---------- NET INTEREST INCOME 235,718 221,860 701,448 594,329 (PROVISION FOR) RECOVERY OF LOAN LOSSES - - - - -------- -------- ---------- ---------- NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 235,718 221,860 701,448 594,329 -------- -------- ---------- ---------- NON-INTEREST INCOME Other charges 3,855 4,181 8,722 11,702 -------- -------- ---------- ---------- NON-INTEREST EXPENSE GENERAL AND ADMINISTRATIVE Compensation and benefits 77,274 96,641 233,682 449,297 Occupancy and equipment 7,795 11,500 22,957 27,559 Computer services 12,622 8,524 32,057 24,986 SAIF deposit insurance 4,296 4,561 13,145 18,471 Other 52,951 22,519 167,344 69,208 -------- -------- ---------- ---------- TOTAL NON-INTEREST EXPENSE 154,938 143,745 469,185 589,521 -------- -------- ---------- ---------- INCOME BEFORE TAXES 84,635 82,296 240,985 16,510 INCOME TAX (EXPENSE) BENEFIT (30,887) (28,574) (95,620) 635 -------- -------- ---------- ---------- NET INCOME $ 53,748 $ 53,722 $ 145,365 $ 17,145 ======== ======== ========== ========== BASIC EARNINGS PER COMMON SHARE $ 0.14 $ 0.06 $ 0.37 $ 0.06 ======== ======== ========== ========== DILUTED EARNINGS PER COMMON SHARE $ 0.14 $ 0.06 $ 0.37 $ 0.06 ======== ======== ========== ========== WEIGHTED AVERAGE COMMON SHARES OUTSTANDING BASIC 396,116 392,730 396,116 392,730 DILUTED 396,116 392,730 396,116 392,730 DIVIDENDS PER SHARE $ 0.15
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 4 ROCKY FORD FINANCIAL, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Nine Months Ended June 30, -------------------------- 1998 1997 ---------- --------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 145,365 $ 17,145 ----------- ----------- Adjustments to reconcile net income to net cash provided by operating activities: Amortization of: Deferred loan origination fees (7,276) (12,450) Discounts on investments (845) (755) Stock dividend received from FHLB (18,900) (15,300) ESOP market value expense 15,617 3,100 Depreciation 12,568 15,024 Change in assets and liabilities Accrued interest receivable 9,318 (20,742) Prepaids 19,666 5,769 Accounts payable and accrued expenses 3,281 55,298 Current income taxes 50,020 - Deferred income taxes 2,471 (14,109) ----------- ----------- TOTAL ADJUSTMENTS 85,920 15,835 ----------- ----------- NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES 231,285 32,980 ----------- ----------- CASH FLOWS FROM INVESTING ACTIVITIES Net change in certificates of deposit 397,035 199,000 Loan originations and principal payments on loans (422,864) (835,687) Purchase of investment securities held to maturity - (248,906) Principal payments on mortgage-backed securities 468,589 84,666 Capital purchases (8,365) (4,630) Establishing retirement plan trust - (216,482) ----------- ----------- NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES 434,395 (1,022,039) ----------- ----------- CASH FLOWS FROM FINANCING ACTIVITIES Issuance of common stock - 3,542,440 Net change in deposits (565,339) (389,936) Net change in mortgage escrow funds (14,035) (16,829) Dividends paid (58,402) - ----------- ----------- NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES (637,776) 3,135,675 ----------- ----------- NET INCREASE IN CASH AND CASH EQUIVALENTS 27,904 2,146,616 CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 3,205,382 2,221,416 ----------- ----------- CASH AND CASH EQUIVALENTS AT END OF YEAR $ 3,233,286 $ 4,368,032 =========== =========== SUPPLEMENTAL DISCLOSURE OF CASH FLOWS Cash paid for: Taxes $ 23,969 $ 43,205 Interest 584,722 297,264
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 5 ROCKY FORD FINANCIAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) June 30, 1998 Note 1. Nature of Business Rocky Ford Financial, Inc. (the "Company") was incorporated under the laws of the State of Delaware for the purpose of becoming the holding company of Rocky Ford Federal Savings and Loan Association (the "Association") in connection with the Association's conversion from a federally chartered mutual savings and loan association to a federally chartered stock savings and loan association, pursuant to its Plan of Conversion. The Company was organized in January 1997 to acquire all of the common stock of Rocky Ford Federal Savings and Loan Association upon its conversion to stock form. The subscription and community offering of the Company's shares was completed on May 21, 1997. Note 2. Basis of Presentation The accompanying unaudited consolidated financial statements,(except for the statement of financial condition at September 30, 1997, which is audited) have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management all adjustments necessary for a fair presentation of the financial position and results of operations for the periods presented have been included. The financial statements of the Company are presented on a consolidated basis with those of Rocky Ford Federal Saving and Loan Association. The account balances include only the accounts and operations of Rocky Ford Federal Savings and Loan Association prior to May 21, 1997. The results of operations for the three and nine months ended June 30, 1998 are not necessarily indicative of the results of operations that may be expected for the year ended September 30, 1998. The accounting policies followed are as set forth in Note 1 of the Notes to Financial Statements in the 1997 Rocky Ford Financial Inc., financial statements, included as item 7 to the Company's annual report on Form 10-KSB for the year ended September 30, 1997, and incorporated herein by reference. Note 3. Regulatory Capital Requirements At June 30, 1998, the Association met each of the three current minimum regulatory capital requirements. The following table summarizes the Association's regulatory capital position at June 30, 1998: Tangible Capital: Actual $4,712,000 22.50% Required 314,000 1.50 Excess $4,398,000 20.00% Tier 1 (Core) Capital: Actual $4,712,000 22.50% Required 838,000 4.00 Excess $3,874,000 18.50% Total Risk-Based Capital: Actual $4,772,000 55.15% Required 692,000 8.00 Excess $4,080,000 47.15% 6 ROCKY FORD FINANCIAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) JUNE 30, 1998 Note 3. Regulatory Capital Requirements (Continued) Tangible and core capital levels are shown as a percentage of total adjusted assets; risk-based capital levels are shown as a percentage of risk-weighted assets. Note 4. Mutual to Stock Conversion On January 14, 1997, The Board of Directors of the Association adopted a Plan of Conversion (the Plan) under which the Association would convert from a federally charted mutual savings and loan association to a federally chartered stock savings and loan association and become a wholly-owned subsidiary of the Company formed in connection with the Conversion. The Plan was approved by the Office of Thrift Supervision (OTS) and included the filing of a registration statement with Securities and Exchange Commission. The Plan was approved by the members of the Association at a special meeting held May 6, 1997. In accordance with the Plan, the Company issued common stock which was sold in the Conversion. The closing of the offering occurred on May 21, 1997 and resulted in a stock offering of $4,232,000 (including $331,560 in shares subscribed by the ESOP). The Company transferred fifty percent of the net proceeds for the purchase of all of the capital stock of the Association. The costs of issuing the common stock were deferred and was deducted from the proceeds of the stock sale and amounted to $410,186. For the purpose of granting eligible members of the Association a priority in the event of future liquidation, the Association, at the time of conversion, established a liquidation account equal to its regulatory capital as of the date of the latest balance sheet used in the final conversion offering circular. In the event (and only in such event) of future liquidation of the converted Association, an eligible savings account holder who continues to maintain a savings account shall be entitled to receive a distribution from the liquidation account, in the proportionate amount of the then-current adjusted balance of the savings deposits then held, before any distributions may be made with respect to capital stock. The Association may not declare or pay a cash dividend on its common stock if its net worth would thereby be reduced below either the aggregate amount then required for the liquidation account or the minimum regulatory capital requirements imposed by federal regulations The ESOP stock purchases were financed by issuing a note to the Company for the entire purchase. Note 5. Earnings Per Share The Company adopted Financial Accounting Standards Board Statement No. 128 relating to earnings per share, effective for the quarter ended December 31, 1997. The statement requires dual presentations of basic and diluted earnings per share on the face of the income statement. Basic EPS excludes dilution and is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diltuted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shares in the earnings of the entity. Earnings per share amounts for the periods ended June 30, 1997, have been restated to conform to the requirements of this statement. Note 6 Dividends Paid On January 12, 1998, the Board of Directors declared a cash dividend of $0.15 per share to stockholders of record as of February 16, 1998 and paid on February 25, 1998. 7 ROCKY FORD FINANCIAL, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS COMPARISON OF FINANCIAL CONDITION AT JUNE 30, 1998 AND SEPTEMBER 30, 1997 The Company's total assets decreased by $300,000 or 1.29% from $23.2 million at September 30, 1997 to $22.9 million at June 30, 1998. The decrease is attributed to assets used to fund the reduction in deposits. The Company's loan portfolio had a net increase of approximately $430,000 during the nine months ended June 30, 1998. Net loans totaled $14.0 million at June 30, 1998 and $13.5 million at September 30, 1997. During the nine months ended June 30, 1998, the Company wrote loans in the amount of $2.2 million and received payments in the amount of $1.7 million. As of June 30, 1998, the outstanding loan commitments for real estate loans was $300,000. The allowance for loan losses totaled $60,000 at June 30, 1998 and September 30, 1997. As of those dates the Company did not have any non-performing loans in its portfolio. There were no loans charged off or recoveries of previous loan losses during the nine months ended June 30, 1998. The determination of the allowance for loan losses is based on management's analysis, performed on a quarterly basis, of various factors, including the market value of the underlying collateral, growth and composition of the loan portfolio, the relationship of the allowance for loan losses to outstanding loans, historical loss experience, delinquency trends and prevailing economic conditions. Although management believes its allowance for loan losses is adequate, there can be no assurance that additional allowances will not be required or that losses on loans will not be incurred. The Company has had minimal losses on loans in prior years. At June 30, 1998, the ratio of the allowance for loan losses to net loans was .43%. as compared to .44% at September 30, 1997. The Company's interest earning assets, excluding loans, decreased $600,000 from $8.8 million at September 30, 1997 to $8.2 million at June 30, 1998. The Company's investment portfolio, at June 30, 1998, included mortgage-backed and related securities classified as "held to maturity" carried at amortized cost of $2.7 million and an estimated fair value of $2.8 million, equity securities classified as "available for sale" with an estimated fair value of $544,000 and interest bearing deposits with various financial institutions totaling $4.6 million. At June 30, 1998 deposits decreased to $15.6 million from $16.1 million at September 30, 1997 or a net decrease of 3.11%. The decrease is attributed to normal seasonal withdrawals. Management is continually evaluating the investment alternatives available to the Company's customers, and adjusts the pricing on its savings products to maintain its existing deposits. COMPARISON OF OPERATING RESULTS FOR THE NINE MONTHS ENDED JUNE 30, 1998 AND 1997 Net Income. The Company's net income for the nine months ended June 30, 1998 was $145,000 compared to net income of $17,000 for the nine months ended June 30, 1997. The decrease in net earnings for the nine months ended June 30, 1997 resulted primarily from the recognition of past service retirement expense of approximately $142,000, net of deferred income tax effect, in accordance with the retirement plan adopted by the board of directors effective March 31, 1997. Net Interest Income. Net interest income for the nine months ended June 30, 1998 was $701,000 compared to $594,000 for the nine months ended June 30, 1997. The increase in net interest income for the nine months ended June 30, 1998 was due to an increase in the interest rate spread from 2.49% in 1997 to 2.78% in 1998, and a decrease in deposits of $1.2 million, with a corresponding decrease in interest expense from $627,000 for the nine months ended June 30, 1997 to $576,000 for the nine months ended June 30, 1998. 8 ROCKY FORD FINANCIAL, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Interest Income. Interest income increased by $56,000 from $1.2 million to $1.3 million or by 4.58%, during 1998 compared to 1997. This increase resulted from an increase of average interest-earning assets from $20.3 million as of June 30, 1997 to $22.3 million as of June 30, 1998. The Company experienced a decrease in the average yield on the interest-earning assets from 8.02% in 1997 to 7.64% in 1998 Interest Expense. Interest expense decreased $52,000 to $576,000 for the nine months ended June 30, 1998 from $628,000 for the nine months ended June 30, 1997. The decrease in expense for the period was caused by the increase of the average rate paid from 4.84% in 1997 to 4.86% in 1998 with a corresponding decrease in deposits from $16.8 million in 1997 to $15.6 million in 1998. Provision for Loan Losses. The allowance for loan losses is established through a provision for loan losses based on management's evaluation of the risk inherent in its loan portfolio and the general economy. Such evaluation considers numerous factors including, general economic conditions, loan portfolio composition, prior loss experience, the estimated fair value of the underlying collateral and other factors that warrant recognition in providing for an adequate loan loss allowance. The Company determined a provision for loan loss was not required for the nine months ended June 30, 1998 and 1997. Non-Interest Expense. The decrease in the non-interest expense section of $120,000 is attributed to a $214,000 retirement expense recognized in June 30, 1997, off set by increased professional fees and employee benefit plans incurred in the current period of $94,000. Income Tax Expense. The benefit recognized as of June 30, 1997 was due to tax credits earned by the Company. The expense recognized as of June 30, 1998 represents the estimated tax due on taxable income at the effective tax rate of 40%. The rate exceeds the statutory rate due to nondeductible ESOP expenses recognized and the effect of state taxes. COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS ENDED JUNE 30, 1998 AND 1997 Net Income. The Company's net income for the three months ended June 30, 1998 and 1997 was $54,000. The results is attributed to the additional funds available to Company from the stock offering, less the effects of benefit plans that have been adopted and professional fees incurred due to additional reporting requirements. Net Interest Income. Net interest income for the three months ended June 30, 1998 was $236,000 compared to $222,000 for the three months ended June 30, 1997. The increase in net interest income for the three months ended June 30, 1998 was due to a decline in the rate spread from 3.11% for the three months ended June 30, 1998 to 2.78% for the three months ended June 30, 1998. In addition deposits decreased by $1.7 million resulting in a corresponding decline in interest expense of $25,000. Interest Income. Interest income decreased by $11,000, from $436,000 for the three months ended June 30, 1997 to $425,000 for the three months ended June 30, 1997. This decrease resulted from an increase of average interest-earning assets from $21.7 million for the three months ended June 30, 1997 to $22.3 million for the three months ended June 30, 1998. The Company experienced a decrease in the average yield on the interest- earning assets from 8.02% in 1997 to 7.64% in 1998. 9 ROCKY FORD FINANCIAL, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Interest Expense. Interest expense decreased $25,000 for the three months ended June 30, 1998 as compared to June 30, 1997. The decrease in expense for the period was caused by the $1.7 million decrease in average deposits from $17.4 million for the three months ended June 30, 1997 to $15.7 million for the three months ended June 30, 1998. Non-Interest Expense. The increase in non-interest expense of $11,000 from $144,000 for the three months ended June 30, 1997 to $155,000 for the three months ended June 30, 1998 is attributed to a $20,000 decrease in benefits recognized in 1997 as part of benefit plans adopted by the board offset by increased professional fees of $31,000 due to added reporting and legal requirements. LIQUIDITY AND CAPITAL RESOURCES The Company's primary sources of funds consists of deposits, repayment of loans and mortgage-backed securities, maturities of investments and interest-bearing deposits, and funds provided form operations. While scheduled repayments of loans and mortgage-backed securities and maturities of investment securities are predicable sources of funds, deposit flows and loan prepayments are greatly influenced by the general level of interest rates, economic conditions and competition. The Company uses its liquidity resources principally to fund existing and future loan commitments, to fund maturing certificates of deposit and demand deposit withdrawals, to invest in other interest- earning assets, to maintain liquidity, and to meet operating expenses. Management believes that proceeds from the stock sale, loan repayments and other sources of funds will be adequate to meet the Company's liquidity needs for the immediate future. The Company is required to maintain minimum levels of liquid assets as defined by OTS regulations. This requirement, which may be varied at the direction of the OTS depending upon economic conditions and deposit flows, is based upon a percentage of deposits and short-term borrowings. The required minimum ratio was 5% until November 24, 1997, when it was changed to 4%. The Company has historically maintained a level of liquid assets in excess of regulatory requirements. The Company's liquidity ratios at June 30, 1998 and 1997 were 19% and 23%, respectively. IMPACT OF INFLATION AND CHANGING PRICES The financial statements and related data presented herein have been prepared in accordance with generally accepted accounting principles, which require the measurement of financial position and results of operations in terms of historical dollars without considering changes in the relative purchasing power of money over time because of inflation. Unlike most industrial companies, virtually all of the assets and liabilities of the Company are monetary in nature. As a result, interest rates have a more significant impact on the Company's performance than the effects of general levels of inflation. Interest rates do not necessarily move in same direction or in the same magnitude as the prices of goods and services. YEAR 2000 ISSUE The Company has an ongoing program of evaluating the effect of the year 2000 on its information processing systems. The Company's core data processing is performed by an outside vendor. As of May 15, 1998, all of the vendors clients were running on Year 2000-ready software, with the validation phase of the change being implemented. It is management's position that the cost of modifications will not have a material effect on the Company's operations. All costs associated with modifications will be expensed as incurred. 10 ROCKY FORD FINANCIAL, INC. PART II - OTHER INFORMATION ITEM 1: Legal Proceedings None. 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. Not Applicable ITEM 5: Other Information None ITEM 6: Exhibits and Reports on Form 8-K Exhibit 27 - Financial Data Schedule SIGNATURE 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. Rocky Ford Financial, Inc. Registrant Date July 31, 1998 /s/ Keith E. Waggoner -------------------------------- Keith E. Waggoner, President 11 EX-27 2 - ARTICLE 9 FIN. DATA SCHEDULE FOR 3RD QTR 10-QSB
9 9-MOS SEP-30-1998 JUN-30-1998 233,286 4,602,277 0 0 544,419 2,702,529 2,798,350 13,959,706 60,000 22,879,066 15,574,065 0 635,567 0 4,232 0 0 6,665,202 22,879,066 883,195 187,092 207,283 1,277,570 576,122 576,122 701,448 0 0 469,185 240,985 240,985 0 0 145,365 0.37 0.37 7.64 0 0 0 0 0 0 0 60,000 60,000 0 0
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