-----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, QBtNU7fe3ghwulQX8vIYmX9T71hXZuNnDBXJdY5Jpqw6jECl1XwU/77ajiDbLmfl NRPrHceSmNm9ZI3q6upbKg== 0001025537-02-000047.txt : 20020515 0001025537-02-000047.hdr.sgml : 20020515 20020515170316 ACCESSION NUMBER: 0001025537-02-000047 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20020331 FILED AS OF DATE: 20020515 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WYMAN PARK BANCORPORATION INC CENTRAL INDEX KEY: 0001046354 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 522068893 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-23345 FILM NUMBER: 02653519 BUSINESS ADDRESS: STREET 1: 11 WEST RIDGELY RD CITY: LUTHERVILLE STATE: MD ZIP: 21094 BUSINESS PHONE: 4102526450 MAIL ADDRESS: STREET 1: 11 WEST RIDGELY RD CITY: LUTHERVILLE STATE: MD ZIP: 21094 10QSB 1 wyman10qsb3312002.txt WYMAN PARK 3/31/2002 10QSB UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-QSB (Mark One) X Quarterly Report Pursuant to Section 13 or 15(d) of the Securities _________ Exchange Act of 1934 For the quarterly period ended March 31, 2002 _________ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from _____ to _____ Commission File Number: 0-23345 WYMAN PARK BANCORPORATION, INC. ------------------------------- (Exact Name of Small Business Issuer as Specified in its Charter) DELAWARE 52-2068893 - ------------------------------- ---------- (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) 11 WEST RIDGELY ROAD, LUTHERVILLE, MARYLAND 21093 ------------------------------------------------- (Address of Principal Executive Offices) (410)-252-6450 -------------- Registrant's Telephone Number, Including Area Code Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d)of the Exchange Act 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 ___ As of May 15, 2002, the issuer had 822,490 shares of Common Stock issued and outstanding. Transitional Small Business Disclosure Format (check one): Yes___ No X ------- CONTENTS -------- PART I. FINANCIAL INFORMATION PAGE --------------------- ---- Item I. Financial Statements Consolidated Statements of Financial Condition at March 31, 2002 and June 30, 2001......................................2 Consolidated Statements of Operations for the Three Month and Nine Month Periods ended March 31, 2002 and 2001.... .................3 Consolidated Statements of Cash Flows for the Nine Month Periods Ended March 31, 2002 and 2001.................................4 Notes to Consolidated Financial Statements..........................5-6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations..............................................7-12 PART II. OTHER INFORMATION ----------------- Item 1. Legal Proceedings....................................................13 Item 2. Changes in Securities and Use of Proceeds............................13 Item 3. Defaults Upon Senior Securities......................................13 Item 4. Submission of Matters to a Vote of Security Holders..................13 Item 5. Other Information....................................................13 Item 6. Exhibits and Reports on Form 8-K.....................................13 SIGNATURES....................................................................14 1 Wyman Park Bancorporation, Inc. and Subsidiaries Lutherville, Maryland Consolidated Statements of Financial Condition
March 31 June 30, 2002 2001 ------------ ------------ (Unaudited) Assets ------ Cash and noninterest bearing deposits $ 418,482 $ 882,696 Interest bearing deposits in other banks 526,988 93,680 Federal funds sold 1,144,494 3,455,641 ------------ ------------ Total cash and cash equivalents 2,089,964 4,432,017 Investments 3,522,833 -- Loans receivable, net 62,030,841 64,712,777 Mortgage-backed securities held to maturity at amortized cost, fair value of $117,608 (3/2002) and $146,691 (6/2001) 116,390 145,796 Federal Home Loan Bank of Atlanta stock, at cost 528,900 528,900 Accrued interest receivable 318,000 345,969 Ground rents owned, at cost 120,100 122,600 Property and equipment, net 73,275 83,069 Federal and state income taxes receivable 1,209 6,237 Deferred tax asset 217,646 217,646 Prepaid expenses and other assets 923,577 53,596 ------------ ------------ Total Assets $ 69,942,735 $ 70,648,607 ------------ ------------ Liabilities & Stockholders'Equity --------------------------------- Liabilities: Demand deposits $ 5,731,279 $ 5,246,632 Money market and NOW accounts 10,128,079 9,454,074 Time deposits 43,563,072 45,481,277 ------------ ------------ Total deposits 59,422,430 60,181,983 Advance payments by borrowers for taxes, insurance and ground rents 814,926 1,196,077 Accrued interest payable on savings deposits 9,554 12,544 Federal and state income taxes payable 5,508 20,455 Accrued expenses and other liabilities 606,998 556,820 ------------ ------------ Total liabilities 60,859,416 61,967,879 Stockholders' Equity - -------------------- Common stock, par value $.0l per share; authorized 2,000,000 shares; issued 1,011,713 shares 10,117 10,117 Additional paid-in capital 4,222,378 4,149,733 Contra equity - Employee Stock Ownership Plan (ESOP) (451,008) (451,008) Retained earnings, substantially restricted 7,050,772 6,720,826 Treasury Stock; 189,223 shares at cost at March 31, 2002 and June 30, 2001 (1,748,940) (1,748,940) ------------ ------------ Total stockholders' equity 9,083,318 8,680,728 ------------ ------------ Total liabilities and stockholders' equity $ 69,942,735 $ 70,648,607 ------------ ------------
See accompanying notes to financial statements. 2 Wyman Park Bancorporation, Inc. and Subsidiaries Lutherville, Maryland Consolidated Statements of Operation (Unaudited)
For the Nine Months For the Three Months Ended March 31, Ended March 31, 2002 2001 2002 2001 ---- ---- ---- ---- Interest and fees on loans receivable $3,441,500 $3,691,787 $1,108,095 $1,236,193 Interest on mortgage-backed securities 6,258 9,538 1,922 3,042 Interest on other investments 112,140 138,891 30,816 33,079 ---------- ---------- ---------- ---------- Total interest income $3,559,898 $3,840,216 $1,140,833 $1,272,314 ---------- ---------- ---------- ---------- Interest on savings deposits $1,953,782 $2,144,058 $ 569,362 $ 721,659 Interest on borrowed money -- 106,733 -- 18,323 Interest on escrow deposits 1,084 1,554 436 556 ---------- ---------- ---------- ---------- Total interest expense $1,954,866 $2,252,345 $ 569,798 $ 740,538 Net interest income before provision for loan losses 1,605,032 1,587,871 571,035 531,776 Provision for loan losses 165 -- -- -- ---------- ---------- ---------- ---------- Net interest income $1,604,867 $1,587,871 $ 571,035 $ 531,776 ---------- ---------- ---------- ---------- Other Income - ------------ Loan fees and service charges $ 80,465 $ 78,572 $ 25,791 $ 31,444 Gain on sales of loans receivable 25,937 -- 1,839 -- Other 26,475 8,879 5,200 2,441 ---------- ---------- ---------- ---------- Total other income $ 132,877 $ 87,451 $ 32,830 $ 33,885 ---------- ---------- ---------- ---------- Noninterest Expenses - -------------------- Salaries and employee benefits $ 723,923 $ 690,285 $ 240,919 $ 247,184 Occupancy costs 76,398 84,994 25,213 30,300 Professional services 55,549 47,730 22,513 13,922 Federal deposit insurance premiums 8,138 8,440 2,637 2,741 Furniture and fixtures depreciation and maintenance 31,271 34,128 10,772 11,159 Data processing 62,829 62,510 21,922 21,594 Advertising 19,244 47,557 3,925 10,051 Franchise and other taxes 37,983 42,741 18,811 20,721 Other 177,447 153,628 67,956 48,058 ---------- ---------- ---------- ---------- Total noninterest expenses $1,192,782 $1,172,013 $ 414,668 $ 405,730 Income before tax provision 544,962 503,309 189,197 159,931 Provision for income taxes 215,016 193,600 75,000 61,000 ---------- ---------- ---------- ---------- Net Income $ 329,946 $ 309,709 $ 114,197 $ 98,931 ---------- ---------- ---------- ---------- Basic net income per share $0.45 $0.42 $0.15 $0.14 Diluted net income per share $0.42 $0.41 $0.14 $0.13
See accompanying notes to financial statements. 3 Wyman Park Bancorporation, Inc. and Subsidiaries Lutherville, Maryland CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Nine Months Ended March 31, --------------------------- 2002 2001 ---- ---- Cash Flows from operating activities - ------------------------------------ Net income $ 329,946 $ 309,709 Adjustments to reconcile net income to net Cash provided by operating activities: Depreciation and amortization 28,640 30,988 Non-cash compensation under stock based benefit plan 72,645 75,667 Amortization of loan fees (54,590) (37,691) Provision for loan loss 165 -- Gain on sales of loans receivable (25,937) -- Loans originated for sale (1,462,750) -- Proceeds from loans originated for sale 1,488,687 -- Decease in accrued interest receivable 27,969 2,291 Increase in prepaid expenses and other assets (869,981) (4,058) Increase in accrued expenses and other liabilities 50,178 50,967 (Increase) decrease in federal and sate income taxes receivable 5,028 (14,713) Decrease in federal and state income taxes payable (14,947) (8,748) Decrease in accrued interest payable on savings deposits (2,990) (3,813) Increase in accrued interest payable on borrowings -- (10,007) ----------- ----------- Net cash provided by (used in) operating activities (427,937) 390,592 Cash flows from investing activities - ------------------------------------ Purchase of investments (3,522,833) -- Proceeds from sale of ground rents 2,500 -- Net (increase) decrease in loans receivable 5,162,831 (71,412) Purchase of loan participations (2,426,470) (330,459) Mortgage-backed securities principal repayments 29,406 19,191 Purchase of FHLB of Atlanta Stock -- (20,400) Purchases of property and equipment (18,846) (5,449) ----------- ----------- Net cash used in investing activities (773,412) (408,529) Cash flows from financing activities - ------------------------------------ Net increase (decrease) in savings deposits (759,553) 2,037,188 Decrease in borrowings -- (2,000,000) Decrease in advance payments by borrowers for taxes, insurance and ground rents (381,151) (417,624) Repurchase of common stock -- (505,075) ----------- ----------- Net cash used in financing activities (1,140,704) (885,511) Net decrease in cash and cash equivalents $(2,342,053) $ (903,448) Cash and cash equivalents at beginning of period 4,432,017 2,085,906 ----------- ----------- Cash and cash equivalents at end of period $ 2,089,964 $ 1,182,458 ----------- ----------- Supplemental information - ------------------------ Interest paid on savings deposits and borrowed funds $ 1,954,866 $ 2,252,344 Income taxes paid $ 197,000 $ 217,060
See accompanying notes to financial statements. 4 WYMAN PARK BANCORPORATION, INC. AND SUBSIDIARIES LUTHERVILLE, MARYLAND NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE 1: WYMAN PARK BANCORPORATION, INC. Wyman Park Bancorporation, Inc. (the "Company") is the holding company of Wyman Park Federal Savings & Loan Association ("Association"), which converted from mutual to stock form ("Stock Conversion") and became the wholly owned subsidiary of the Company on January 5, 1998. All references to the Company prior to January 5, 1998, except where otherwise indicated are to the Association. The Company's common stock began trading on the OTC Electronic Bulletin Board on January 7, 1998 under the symbol "WPBC". The Association is regulated by the Office of Thrift Supervision ("OTS"). The primary business of the Association is to attract deposits from individual and corporate customers and to originate residential and commercial mortgage loans and consumer loans. The Association competes with other financial and mortgage institutions in attracting and retaining deposits and originating loans. The Association conducts operations through its main office located at 11 West Ridgely Road, Lutherville, Maryland 21093 and one branch office located at 7963 Baltimore-Annapolis Boulevard, Glen Burnie, Maryland 21060. NOTE 2: BASIS OF PRESENTATION The accompanying unaudited consolidated financial statements have been prepared in accordance with instructions for Form 10-QSB and therefore, do not include all disclosures necessary for a complete presentation of the statements of condition, statements of operations and statements of cash flows in conformity with generally accepted accounting principles. However, all adjustments which, in the opinion of management, are necessary for the fair presentation of the interim financial statements have been included. Such adjustments were of a normal recurring nature. The results of operations for the nine months ended March 31, 2002 are not necessarily indicative of the results that may be expected for the entire year. Certain prior year amounts have been reclassified to conform with the current year presentation. NOTE 3: CASH AND CASH EQUIVALENTS For the purposes of the statement of cash flows, the Company considers all highly liquid investments with maturities at date of purchase of three months or less to be cash equivalents. Cash equivalents consist of cash, non-interest bearing deposits, variable rate interest bearing deposits in other banks and federal funds sold. 5 NOTE 4: EARNINGS PER SHARE Basic earnings per share is computed by dividing net income by the weighted average number of common shares outstanding for the appropriate period. Unearned Employee Stock Ownership Plan (ESOP) shares are not included in outstanding shares. Diluted earnings per share is computed by dividing net income by the weighted average shares outstanding as adjusted for the dilutive effect of stock options and unvested stock awards based on the "treasury stock" method. Information relating to the calculations of net income per share of common stock is summarized for the three months and nine months ended March 31, 2002 and 2001 as follows: Three Months Ended Six Months Ended March 31, March 31, 2002 2001 2002 2001 -------------------- -------------------- Net income $114,197 $ 98,931 $329,946 $309,709 Weighted average shares Outstanding basic EPS 742,057 710,598 729,104 729,692 Dilutive items Stock options 66,540 32,417 53,133 28,777 Unvested stock awards 797 158 -- -- Adjusted weighted average shares Outstanding used for diluted EPS 809,394 743,173 782,237 758,469 NOTE 5: REGULATORY CAPITAL REQUIREMENTS Under OTS regulations, the Association must maintain capital at least equal to specified percentage of its assets. The Association's assets and capital for these purposes are subject to OTS regulatory definition, and the percentage levels vary depending on the capital levels being measured. The following table presents the Association's capital position based on the March 31, 2002 financial statements.
To Be Well Capitalized Under For Capital Prompt Corrective Actual Adequacy Purposes Action Provisions -------------------- ------------------ ------------------ Amount Ratio Amount Ratio Amount Ratio ------ ----- ------ ----- ------ ----- Total Capital (to Risk Weighted Assets) $8,743,920 20.9% $3,346,125 8.0% $4,182,657 10.0% Tier I capital (to Risk Weighted Assets) 8,460,292 20.2% 1,673,063 4.0% 2,509,594 6.0% Tier 1 Capital (to Average Assets) 8,460,292 12.1% 2,797,343 4.0% 3,496,679 5.0%
6 ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. FORWARD-LOOKING STATEMENTS When used in this filing and in future filings by the Company with the Securities and Exchange Commission, in the Company's press releases or other public or shareholder communications, or in oral statements made with the approval of an authorized executive officer, the words or phrases "would be," "will allow," "intends to," "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project" or similar expressions are intended to identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to risks and uncertainties, including but not limited to changes in economic conditions in the Company's market area, changes in policies by regulatory agencies, fluctuations in interest rates, demand for loans in the Company's market area and competition, all or some of which could cause actual results to differ materially from historical earnings and those presently anticipated or projected. The Company wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made, and advises readers that various factors, including regional and national economic conditions, substantial changes in levels of market interest rates, credit and other risks of lending and investment activities and competitive and regulatory factors, could affect the Company's financial performance and could cause the Company's actual results for future periods to differ materially from those anticipated or projected. The Company does not undertake, and specifically disclaims any obligations, to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements. 7 COMPARISON OF FINANCIAL CONDITION AT MARCH 31, 2002 AND JUNE 30, 2001 The Company's assets decreased $700,000 or 1.0% to $69.9 million at March 31, 2002 from $70.6 million at June 30, 2001. Cash and cash equivalents decreased $2.3 million or 52.3% to $2.1 million at March 31, 2002 from $4.4 million at June 30, 2001, primarily as a result of an increase in investments, offset by a decrease in savings deposits and a decrease in advance payments by borrowers for taxes, insurance and ground rents. Investments increased $3.5 million at March 31, 2002 from $0 at June 30, 2001, as a result of an investment of $3.5 million in a cash management fund. Net loans receivable decreased $2.7 million or 4.2% to $62.0 million at March 31, 2002 from $64.7 million at June 30, 2001 as a result of normal amortization and payoffs. Prepaid expenses and other assets increased $870,000 to $924,000 at March 31, 2002 from $54,000 at June 30, 2001 due to an increase in accounts receivable. This increase relates primarily to an expected insurance company reimbursement to the Bank for an embezzlement discovered by the Bank's senior management in January 2002. The Bank immediately notified the appropriate federal law enforcement and bank regulatory agencies and also commenced its own internal review with the assistance of a special forensic accounting firm. As a result of the review, the Bank has instituted additional controls to prevent a recurrence of this event. In addition, the Bank immediately notified its insurer and submitted a timely claim and the Bank anticipates being reimbursed for the entire amount of the embezzlement less the $10,000 deductible and for the Bank's additional accounting expenses. No depositor of the Bank suffered any loss as a result of this matter. Any additional expenses incurred by the Bank as a result of this matter did not have a material impact on net income. Savings deposits decreased $800,000 or 1.3% to $59.4 million at March 31, 2002 from $60.2 million at June 30, 2001. The Company believes the deposit decline is a result of customer reaction to reduced deposit rates, as the Company seeks to manage its net interest margin. Advance payments by borrowers for taxes, insurance, and ground rents decreased $400,000 or 33.3% to $800,000 at March 31, 2002 from $1.2 million at June 30, 2001 as a result of the payment of real estate taxes. The Company's stockholders' equity increased $400,000 or 4.6% to $9.1 million at March 31, 2002 from $8.7 million at June 30, 2001 primarily due to net income of $300,000 for the nine months ended March 31, 2002. COMPARISON OF OPERATING RESULTS FOR THE QUARTER AND NINE MONTHS ENDED MARCH 31, 2002 AND MARCH 31, 2001 Net Income - ---------- The Company reported net income of $114,000 for the quarter ended March 31, 2002 compared to $99,000 for the quarter ended March 31, 2001. The $15,000 increase in net income was primarily due to an increase in net interest income of $39,000, offset by an increase in noninterest expense of $9,000 and an increase in provision for income taxes of $14,000. 8 The Company's net income for the nine months ended March 31, 2002 was $330,000 compared to $310,000 for the nine months ended March 31, 2001. The $20,000 increase in net income was primarily due to an increase in net interest income of $17,000 and an increase in other income of $46,000, offset by an increase in noninterest expense of $21,000 and an increase in provision for income taxes of $22,000. Interest Income - --------------- Total interest income decreased by $131,000 or 10.3% to $1,141,000 for the quarter ended March 31, 2002 from $1,272,000 for the quarter ended March 31, 2001. The decrease in total interest income for the comparable three months periods was due primarily to a decrease of 74 basis points in the average yield on interest-earning assets to 6.75% from 7.49%, as a result of declining interest rates. Total interest income decreased by $280,000 or 7.3% to $3,560,000 for the nine months ended March 31, 2002 from $3,840,000 for the nine months ended March 31,2001. The decrease in total interest income for the comparable nine months periods was due primarily to a decrease of 54 basis points in the average yield on interest-earning assets to 7.00% from 7.54%, as a result of declining interest rates. Interest Expense - ---------------- Total interest expense decreased by $171,000 or 23.1% to $570,000 for the quarter ended March 31, 2002 from $741,000 for the quarter ended March 31, 2001. The decrease in total interest expense for the comparable three months periods was due primarily to a decrease of 116 basis points in the average yield on interest-bearing liabilities to 3.89% from 5.05%. Total interest expense decreased by $297,000 or 13.2% to $1,955,000 for the nine months ended March 31, 2002 from $2,252,000 for the nine months ended March 31, 2001. The decrease in total interest expense for the comparable nine months periods was due primarily to a decrease of 65 basis points in the average yield on interest-bearing liabilities to 4.45% from 5.10%. Net Interest Income - ------------------- The Company's net interest income increased $39,000 or 7.3% to $571,000 for the quarter ended March 31, 2002 from $532,000 for the quarter ended March 31, 2001. The increase in net interest income was primarily due to a decline in the average yield on interest bearing liabilities in a greater amount than the decline in the average yield on interest earning assets. This is reflected in the Company's net interest margin, which increased by 25 basis points to 3.38% from 3.13% for the comparable three months periods. 9 The Company's net interest income increased $17,000 or 1.1% to $1,605,000 for the nine months ended March 31, 2002 from $1,588,000 for the nine months ended March 31, 2001. The increase in net interest income was primarily due to a decline in the average yield on interest bearing liabilities in a greater amount than the decline in the average yield on interest earning assets. This is reflected in the Company's net interest margin, which increased by 3 basis points to 3.15% from 3.12% for the comparable nine months periods. Provision For Loan Losses - ------------------------- Management monitors its allowance for loan losses and makes additions to the allowance, through the provision for loan losses, as economic conditions and other factors dictate. Among the other factors considered by management are loan volume, type of collateral and prior loan loss experience. During the three months ended March 31, 2002, the Company recorded no provision for loan losses. During the nine months ended March 31, 2002, the Company recorded a provision for loan losses of $165. During the three months and nine months ended March 31, 2001, the Company recorded no provision for loan losses. The Company's nonperforming loans as a percentage of loans receivable was 0.29% and 0.14% at March 31, 2002, and June 30, 2001, respectively, all consisting of single-family residential mortgage loans. Noninterest Income - ------------------ Total noninterest income remained virtually unchanged at $33,000 for the quarter ended March 31, 2002 compared to $34,000 for the quarter ended March 31, 2001. Total noninterest income increased by $46,000 or 52.9% to $133,000 for the nine months ended March 31,2002 from $87,000 for the nine months ended March 31, 2001. The increase in noninterest income was due primarily to an increase of $26,000 in gain on sales of loans receivable to $26,000 for the nine months ended March 31, 2002 from $0 for the nine months ended March 31, 2001 and an increase of $17,000 in other income to $26,000 for the nine months ended March 31, 2001 from $9,000 for the nine months ended March 31, 2001 due to sales of annuities and miscellaneous fees. Noninterest Expenses - -------------------- Total noninterest expenses increased by $9,000 or 2.2% to $415,000 for the quarter ended March 31, 2002 from $406,000 for the quarter ended March 31, 2001. The increase in noninterest expenses was primarily due to an increase in other non interest expense of $20,000 to $68,000 for the quarter ended March 31, 2002 from $48,000 for the quarter ended March 31, 2001, primarily due to an accrual of the deductible of $10,000 on the Company's blanket bond in connection with the pending insurance claim. 10 Total noninterest expenses increased by $21,000 or 1.8% to $1,193,000 for the nine months ended March 31, 2002 from $1,172,000 for the nine months ended March 31, 2001. The increase in noninterest expenses was primarily due to an increase in salaries and employee benefits of $33,000 to $723,000 for the nine months ended March 31, 2002 from $690,000 for the nine months ended March 31, 2001 and an increase in other non interest expense of $23,000 to $177,000 for the nine months ended March 31, 2002 from $154,000 for the nine months ended March 31, 2001, partially offset by a decrease in advertising expense of $29,000 to $19,000 for the nine months ended March 31, 2002 from $48,000 for the nine months ended March 31, 2001. The increase in salaries and employee benefits was the result of staff additions, the increase in other non interest expense was primarily due to an accrual of the deductible on the Company's blanket bond and the decrease in advertising expense was due to the elimination of a billboard advertising campaign. Liquidity and Capital Resources - ------------------------------- Liquidity management for the Company is both an ongoing and long-term function of the Company's asset/liability management strategy. Excess funds, when applicable, generally are invested in overnight deposits at a correspondent bank and at the Federal Home Loan Bank (FHLB) of Atlanta and in a short term liquid cash management fund. Currently when the Company requires funds, beyond its ability to generate deposits, additional sources of funds are available, as advances or borrowings, through the FHLB of Atlanta. The Company has the ability to pledge its FHLB of Atlanta stock or certain other assets as collateral for up to $14.0 million in advances. The Company's most liquid assets are cash and cash equivalents, which include short-term investments, as well as an investment in a short-term, liquid cash management fund. The levels of these assets are dependent on the Company's operating, financing and investing activities during any given period. At March 31, 2002, the Company's cash on hand, interest bearing deposits, Federal funds sold and short-term investments totaled $5.6 million. Management and the Board of Directors believe that the Company's liquidity is adequate, including its ability to secure advances from the FHLB of Atlanta, to satisfy its loan commitments of approximately $3.2 million as of March 31, 2002. The Company's principal sources of funds are deposits, loan repayments and other funds provided by operations. Certificates of deposit which are scheduled to mature in less than one year at March 31, 2002 totaled $20.9 million. Historically, a high percentage of maturing deposits have remained with the Company. While scheduled loan repayments are relatively predictable, deposit flows and early loan prepayments are more influenced by interest rates, general economic conditions, and competition. The Association maintains investments in liquid assets based upon management's assessment of (1) need for funds, (2) expected deposit flows, (3) yields available on short-term liquid assets and (4) objectives of the asset/liability management program. The Company's primary source of cash in investing activities during the nine months ended March 31, 2002 was a net decrease of $5.2 million in loans receivable, offset by a $2.4 million increase in loan participations. 11 The Company's primary uses of cash in financing activities during the nine months ended March, 2002 consisted of a net decrease of $700,000 in savings deposits and a net decrease of $400,000 in advance payments by borrowers for taxes, insurance and ground rents. 12 PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS None. ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS None. ITEM 3. DEFAULTS UPON SENIOR SECURITIES None. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS None ITEM 5. OTHER INFORMATION None ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits None (b) Reports on Form 8-K None 13 Signatures In accordance with the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized. WYMAN PARK BANCORPORATION, INC. Registrant Date: May 15, 2002 /s/ Ernest A. Moretti ------------------------------------ Ernest A. Moretti President and Chief Executive Officer (Principal Executive Officer) Date: May 15, 2002 /s/ Ronald W. Robinson ------------------------------------- Ronald W. Robinson Treasurer (Principal Financial and Accounting Officer) 14 -----END PRIVACY-ENHANCED MESSAGE-----