-----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, T8CYZRIXCcRIS2FbxuT+6DukN0PYUWBJepUXDQ/pt3I0XD/PAkrR6rxVSUnTHtYw 29stHvE/1swI80IOg1KCOg== 0001021408-99-000389.txt : 19990305 0001021408-99-000389.hdr.sgml : 19990305 ACCESSION NUMBER: 0001021408-99-000389 CONFORMED SUBMISSION TYPE: 10QSB/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19981228 FILED AS OF DATE: 19990304 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ANSON BANCORP INC CENTRAL INDEX KEY: 0001056672 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTIONS, NOT FEDERALLY CHARTERED [6036] IRS NUMBER: 562073894 STATE OF INCORPORATION: NC FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10QSB/A SEC ACT: SEC FILE NUMBER: 001-14241 FILM NUMBER: 99556814 BUSINESS ADDRESS: STREET 1: 211 S GREENE ST CITY: WADESBORO STATE: NC ZIP: 28170 BUSINESS PHONE: 7046942122 MAIL ADDRESS: STREET 1: 211 S GREENE ST CITY: WADESBORO STATE: NC ZIP: 28170 10QSB/A 1 AMENDMENT TO FORM 10-QSB UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON D.C. 25049 FORM 10-QSB/A [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 1998 --------------------- [_] 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 _____________ ANSON BANCORP, INC. ------------------- (EXACT NAME OF SMALL BUSINESS ISSUER AS SPECIFIED IN ITS CHARTER) NORTH CAROLINA 56-2073894 -------------- ---------- (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.) INCORPORATION OR ORGANIZATION) 211 SOUTH GREENE STREET/POST OFFICE BOX 249 WADESBORO, NORTH CAROLINA 28170 ------------------------------- (ADDRESS OF PRINCIPAL EXECUTIVE OFFICE) (ZIP CODE) (704) 694-2122 -------------- (ISSUERS TELEPHONE NUMBER) N/A --- (FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR, IF CHANGED SINCE LAST REPORT) INDICATE BY CHECK X WHETHER THE ISSUER (1) HAS 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 --- --- AS OF JUNE 19, 1998 THERE WERE ISSUED AND OUTSTANDING 585,124 SHARES OF THE REGISTRANT'S COMMON STOCK, NO PAR VALUE TRANSITIONAL SMALL BUSINESS DISCLOSURE FORMAT: YES NO X --- --- ANSON BANCORP, INC. AND SUBSIDIARY - -------------------------------------------------------------------------------- CONTENTS Page PART 1. FINANCIAL STATEMENTS Item 1. Financial Statements Condensed statements of financial condition at June 30, 1998 and December 31, 1998 (unaudited)....................................1 Condensed statements of income for the three months ended December 31, 1997 and 1998 (unaudited)...............................2 Condensed statements of income for the six months ended December 31, 1997 and 1998 (unaudited)...............................3 Condensed statements of cash flows for the six months ended December 31, 1997 and 1998 (unaudited)...............................4 Notes to condensed financial statements (unaudited).....................5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations........................................7 PART II. OTHER INFORMATION Item 1. Legal Proceedings..................................................10 Item 2. Changes in Securities..............................................10 Item 3. Defaults upon Senior Securities....................................10 Item 4. Submission of Matters to a Vote of Security Holders................10 Item 5. Other Information..................................................10 Item 6. Exhibits and Reports on Form 8-K...................................10 SIGNATURES...................................................................11 This Form 10-QSB/A contains forward-looking statements consisting of estimates with respect to the financial condition, results of operations and other business of Anson Bancorp, Inc. that are subject to various factors which could cause actual results to differ materially from those estimates. Factors which could influence the estimates include changes in the national, regional and local market conditions, legislative and regulatory conditions, and an adverse interest rate environment. ANSON BANCORP, INC. AND SUBSIDIARY CONDENSED STATEMENTS OF FINANCIAL CONDITION (UNAUDITED) - -------------------------------------------------------------------------------
June 30, December 31, ------------ ------------- 1998 1998 ------------ ------------- (Note 2) (Unaudited) ASSETS Cash and cash equivalents, including federal funds sold $ 6,433,565 $ 4,021,464 Securities held to maturity, at amortized cost 6,307,425 8,394,924 Securities available for sale, at fair value 433,000 585,000 Loans receivable, net 11,515,484 11,467,348 Accrued interest receivable 100,158 98,582 Property and equipment, net 207,665 274,887 Prepaid expenses and other assets 68,985 85,753 ----------- ----------- Total assets $25,066,282 $24,927,958 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY LIABILITIES Deposits $15,439,963 $15,146,690 Accounts payable and accrued expenses 133,066 49,522 Deferred income taxes 111,000 162,430 ----------- ----------- Total liabilities 15,684,029 15,358,642 ----------- ----------- STOCKHOLDERS' EQUITY Capital stock 5,424,815 5,424,815 Unrealized gain on securities available for sale, net of tax 279,430 380,000 Retained earnings, substantially restricted 3,678,008 3,764,501 ----------- ----------- Total stockholders' equity 9,382,253 9,569,316 ----------- ----------- Total liabilities and stockholders' equity $25,066,282 $24,927,958 =========== ===========
See Notes to Condensed Financial Statements. -1- ANSON BANCORP, INC. AND SUBSIDIARY CONDENSED STATEMENTS OF INCOME (UNAUDITED) For the three months ended - --------------------------------------------------------------------------------
December 31, ------------------ 1997 1998 -------- -------- INTEREST AND DIVIDEND INCOME Interest and fees on loans $237,759 $228,015 Interest on investments and deposits in other banks 121,304 161,793 -------- -------- Total interest and dividend income 359,063 389,808 INTEREST EXPENSE ON DEPOSITS 204,324 184,959 -------- -------- Net interest income 154,739 204,849 PROVISION FOR LOAN LOSSES - - -------- -------- Net interest income after provision for loan losses 154,739 204,849 NONINTEREST INCOME 537 116 NONINTEREST EXPENSE Compensation and employee benefits 61,974 77,696 Federal insurance premiums 2,626 2,224 Data processing 7,649 10,103 Legal and professional fees 8,055 7,326 Examinations and audit - 7,835 Occupancy including depreciation 4,959 4,983 Other 33,267 38,515 -------- -------- Total noninterest expense 118,530 148,682 -------- -------- Income before income taxes 36,746 56,283 INCOME TAXES 9,984 20,000 -------- -------- Net income $ 26,762 $ 36,283 ======== ======== Basic earnings per share (Note 3) $ N/A $ .06 ======== ======== Diluted earnings per share (Note 3) $ N/A $ .06 ======== ======== Dividends per share $ 0 $ 0 ======== ========
See Notes to Condensed Financial Statements. -2- ANSON BANCORP, INC. AND SUBSIDIARY CONDENSED STATEMENTS OF INCOME (UNAUDITED) For the six months ended - --------------------------------------------------------------------------------
December 31, ------------------ 1997 1998 -------- -------- INTEREST AND DIVIDEND INCOME Interest and fees on loans $475,383 $461,902 Interest on investments and deposits in other banks 242,747 336,445 -------- -------- Total interest and dividend income 718,130 798,347 INTEREST EXPENSE ON DEPOSITS 411,866 370,983 -------- -------- Net interest income 306,264 427,364 PROVISION FOR LOAN LOSSES - 2,000 -------- -------- Net interest income after provision for loan losses 306,264 425,364 NONINTEREST INCOME 4,269 2,386 NONINTEREST EXPENSE Compensation and employee benefits 134,185 159,148 Federal insurance premiums 5,228 4,799 Data processing 15,846 17,861 Legal and professional fees 8,730 37,367 Examinations and audit 7,910 15,671 Occupancy including depreciation 10,480 10,473 Other 49,175 66,938 -------- -------- Total noninterest expense 231,554 312,257 -------- -------- Income before income taxes 78,979 115,493 INCOME TAXES 16,984 29,000 -------- -------- Net income $ 61,995 $ 86,493 ======== ======== Basic earnings per share (Note 3) $ N/A $ .15 ======== ======== Diluted earnings per share (Note 3) $ N/A $ .15 ======== ======== Dividends per share $ 0 $ 0 ======== ========
See Notes to Condensed Financial Statements. -3- ANSON BANCORP, INC. AND SUBSIDIARY CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) For the six months ended - --------------------------------------------------------------------------------
December 31, ------------------------ 1997 1998 ----------- ----------- OPERATING ACTIVITIES Net income $ 61,995 $ 86,493 Adjustments to reconcile net income to net cash provided by (used for) operating activities Provision for loan losses - 2,000 Provision for depreciation 7,230 6,180 Deferred income taxes - - Changes in operating assets and liabilities Accrued interest receivable 7,483 1,576 Prepaid expenses and other assets ( 47,738) ( 16,768) Accounts payable and accrued expenses 13,123 ( 83,544) ---------- Net cash provided by (used for) operating activities 42,093 ( 4,063) INVESTING ACTIVITIES Investment in property and equipment - ( 73,402) Net decrease in loans receivable 99,714 46,136 Net increase in investments held to maturity ( 435,688) ( 2,087,499) ---------- Net cash used for investing activities ( 335,974) ( 2,114,765) FINANCING ACTIVITIES Net decrease in savings deposits ( 135,404) ( 293,273) ---------- Net decrease in cash and cash equivalents ( 429,285) ( 2,412,101) CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 4,640,610 6,433,565 ---------- ----------- CASH AND CASH EQUIVALENTS, END OF PERIOD $4,211,325 $ 4,021,464 ========== ===========
See Notes to Condensed Financial Statements. -4- ANSON BANCORP, INC. NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED) - -------------------------------------------------------------------------------- NOTE 1 - NATURE OF BUSINESS Anson Bancorp, Inc. (the "Company") was incorporated under the laws of the State of North Carolina for the purpose of becoming the bank holding company of Anson Savings Bank, Inc. (the "Bank" or "Anson Savings Bank") in connection with the Bank's conversion from a state chartered savings bank to a state chartered stock savings bank, pursuant to its amended and restated Plan of Conversion. The Company was organized in 1998 to acquire all of the common stock of Anson Savings Bank, S.S.B. upon its conversion to stock form and the Company has no operations and conducts no business other than owning the Bank and investing its portion of the net proceeds received in the conversion. The principal business of the Bank is accepting deposits from the general public and using those deposits and other sources of funds to make loans secured by real estate and other forms of collateral located in the Bank's primary market area of Anson County in North Carolina. Anson Savings Bank's results of operations depend primarily on its net interest income, which is the difference between interest income from interest-earning assets and interest expense on interest-bearing liabilities. The Bank's operations are also affected by noninterest income, such as miscellaneous income from loans, and other sources of revenue. The Bank's principal operating expenses, aside from interest expense, consist of compensation and associated benefits, federal deposit insurance premiums, occupancy costs, furniture and fixture expense, data processing charges, professional fees and other general and administrative expenses. NOTE 2 - BASIS OF PRESENTATION The accompanying unaudited condensed financial statements (except for the condensed consolidated statement of financial condition at June 30, 1998, which has been taken from the audited financial statements of the Bank at that date) 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 (none of which were other than normal recurring accruals) necessary for a fair presentation of the financial position and results of operations for the periods presented have been included. The Company was not an operating company and did not engage in any significant business until June 1998. The results of operations for the six months ended December 31, 1998 are not necessarily indicative of the results of operations that may be expected for the year ended June 30, 1999. The accounting policies followed are as set forth in Note 1 of the Notes to Financial Statements in the 1998 annual report of the Company. NOTE 3 - EARNINGS PER SHARE Earnings per share are not applicable for the six months ended December 31, 1997 as Anson Savings Bank did not complete its conversion to stock form until June 1998. Basic earnings per share for the six months ended December 31, 1998 is based on unaudited net income earned divided by the weighted average number of shares outstanding during the period. During the period reported there were no dilutive securities outstanding, therefore, basic and diluted earnings per share are the same. -5- ANSON BANCORP, INC. NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED) - -------------------------------------------------------------------------------- NOTE 4 - SUBSEQUENT EVENT AND PLAN OF CONVERSION On June 19, 1998, pursuant to a Plan of Conversion which was approved by its members and regulators, Anson Savings Bank converted from a state chartered mutual savings bank to a state chartered stock savings bank and became a wholly owned subsidiary of Anson Bancorp, Inc. Anson Bancorp, Inc. was formed to acquire all of the common stock of Anson Savings Bank upon its conversion to stock form. The closing of the offering occurred on June 19, 1998 and resulted in the issuance of 585,124 shares of common stock at a price of $10 per share for proceeds of $5,424,815 (net of $426,425 in offering costs). The Company transferred $2,712,408 of the net proceeds to Anson Savings Bank for purchase of all of the common stock of the Bank. NOTE 5 - YEAR 2000 The Company recognizes that there is a business risk in computerized systems as the calendar rolls over into the next century. The Federal Financial Institutions Examination Council (FFIEC) issued an interagency statement on May 5, 1997 outlining five phases for institutions to effectively manage the Year 2000 challenge. The phases were: Awareness, Assessment, Renovation, Validation, and Implementation. The FFIEC encouraged institutions to have all critical applications identified and priorities set by December 31, 1997 and to have renovation work largely completed and testing well underway by December 31, 1998. The Company has an ongoing program designed to ensure that its operational and financial systems will not be adversely affected by Year 2000 software failures, due to processing errors arising from calculations using the Year 2000 date. The Board of Directors and management of the Company have established Year 2000 compliance as a strategic initiative. While the Company believes that it has available resources to assure Year 2000 compliance, it is to some extent dependent on vendor cooperation. At the present time, the Company's most critical applications have been updated and installed. Currently, the Company is testing these systems and should have any problems reconciled by June 30, 1999. At this time, the Company has not fully determined the cost of making modifications to correct any Year 2000 problems; however, equipment and software expenses are not expected to materially differ from past results. The Company routinely upgrades and purchases technologically advanced software and hardware on a continual basis and expects to specifically evaluate and test such purchases for Year 2000 compliance. NOTE 6 - COMPREHENSIVE INCOME On July 1, 1998, the Company adopted statement of financial accounting standard No. 130, "Reporting Comprehensive Income" (SFAS 130). This statement provides standards for reporting comprehensive income. Comprehensive income is defined as the change in equity (Net Assets) during a period from non-owner sources. The purpose of reporting comprehensive income is to report a measure of all changes in equity that result from recognized transactions and other economic events of the period other than transactions with owners in their capacity as owners. Prior to the Issuance of SFAS 130, some of those changes in equity were displayed in a statement that reports the results of operations, while others were included directly in balances within a separate component of equity in a statement of financial position. This statement does not change or modify the reporting or display in the statement of operations. Comprehensive income for Anson Bancorp, Inc. includes the Company's net income and unrealized gains on securities available for sale (other comprehensive income). Total comprehensive income for the periods presented amounted to $187.000 and $121,000 for the six months ended December 31, 1998 and 1997, respectively, and $102,000 and $27,000 for the three months ended December 31, 1998 and 1997, respectively. -6- ANSON BANCORP, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - -------------------------------------------------------------------------------- COMPARISON OF FINANCIAL CONDITION AT DECEMBER 31, 1998 AND JUNE 30, 1998 Total assets amounted to $24.93 million at December 31, 1998, compared to $25.07 million at June 30, 1998. The decrease from June 30, 1998 to December 31, 1998 is primarily attributed to the decrease in deposits. Accounts payable have decreased approximately $85,000 from June 30, 1998 to December 31, 1998. This decrease is due primarily to expenses accrued and subsequently paid related to the Bank's conversion to a state chartered stock savings bank during the period ended June 30, 1998. The principal category of earnings assets is loans receivable which amounted to $11.47 million and $11.52 million at December 31, 1998 and June 30, 1998, respectively. Loan originations for the six months ended December 31, 1998 totaled $1.3 million and were funded by loan principal repayments of $1.31 million as the loan portfolio decreased by approximately $50,000. Loan originations for the year ended June 30, 1998 totaled $2.92 million and principal repayments for 1998 totaled $2.82 million. The Bank maintains underwriting and credit standards designed to maintain the quality of the loan portfolio. Nonperforming loans at December 31, 1998 and June 30, 1998 totaled $152,000 and $179,000, respectively, and were 1.33% and 1.55% of total loans, respectively. In addition to loans, the Company invests in U.S. Treasury and Government agency securities. Management does not engage in the practice of trading securities, rather, the Company's investment portfolio consists primarily of investments designated and held to maturity. Investment securities, including interest-bearing deposits and Federal Home Loan Bank stock, at December 31, 1998 and June 30, 1998, totaled $12.85 million and $12.95 million, respectively. The decrease in investments and loans is primarily attributed to the decrease in deposits. The Bank has experienced some decrease in savings deposits. At December 31, 1998, Anson's deposits decreased approximately $293,000 compared to June 30, 1998. Anson has priced its deposits in a fashion to be at or near the top of the market because of its dependence on the local market for funds availability. The Company's equity, which consists entirely of retained earnings, capital stock and unrealized gains on securities available for sale, net of tax, amounted to $9.56 million and $9.38 million at December 31, 1998 and June 30, 1998, respectively. The Bank has classified a portion of its investments as available for sale which requires reporting such investments at fair market value with unrealized gains or losses, net of tax, shown as a separate component of equity. The equity component for net unrealized gains at December 31, 1998 and June 30, 1998 amounted to $380,000 and $279,000, respectively. COMPARISON OF RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED DECEMBER 31, 1998 AND 1997 Net Income. The Company's net income for the three months ended December 31, 1998 and 1997 was approximately $36,000 and $27,000, respectively. The increase in net income was primarily due to the increase in investments and the increase in capital from the sale of stock. Net Interest Income. Net interest income has increased by 32% to $205,000 for the three months ended December 31, 1998 from $155,000 for the three months ended December 31, 1997. This increase is due primarily to an increase in investment income from the capital raised from the sale of stock. Noninterest Income. Noninterest income consists primarily of fees related to safe deposit boxes and other miscellaneous income and amounted to less than $1,000 for the three months ended December 31, 1998 and 1997, respectively. -7- ANSON BANCORP, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - -------------------------------------------------------------------------------- Noninterest Expense. Noninterest expense consisted primarily of operating expenses for compensation and employee benefits, occupancy, legal and professional fees, federal deposit insurance premiums, data processing charges and other operating expenses. Noninterest expense increased to approximately $149,000 from $119,000 for the three months ended December 31, 1998 and 1997, respectively. This increase is primarily due to the costs associated with operating as a public company and hiring one additional employee. The Bank anticipates that its noninterest expense may continue to increase in the future because of costs associated with compensation, costs associated with operating as a publicly held company, and with purchasing the computer equipment necessary for Year 2000 compliance. Income Taxes. Income tax expense was $20,000 and $10,000 for the three month periods ended December 31, 1998 and 1997, respectively. The fluctuations were primarily attributable to corresponding fluctuations in income before income taxes. COMPARISON OF RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED DECEMBER 31, 1998 AND 1997 Net Income. The Company's net income for the six months ended December 31, 1998 and 1997 was approximately $87,000 and $62,000 respectively. The increase in net income was primarily due to the increase in investments and the increase in capital from the sale of stock. Net Interest Income. Net interest income has increased by 39% to $425,000 for the six months ended December 31, 1998 from $306,000 for the six months ended December 31, 1997. This increase is due primarily to an increase in investment income from the capital raised from the sale of stock. Noninterest Income. Noninterest income consists primarily of fees related to safe deposit boxes and other miscellaneous income and amounted to $2,000 and $4,000 for the six months ended December 31, 1998 and 1997, respectively. Noninterest Expense. Noninterest expense consisted primarily of operating expenses for compensation and employee benefits, occupancy, legal and professional fees, federal deposit insurance premiums, data processing charges and other operating expenses. Noninterest expense increased to $312,000 from $232,000 for the six months ended December 31, 1998 and 1997, respectively. This increase is primarily due to the costs associated with operating as a public company and costs associated with one additional employee. The Bank anticipates that its noninterest expense may continue to increase in the future because of costs associated with compensation, costs associated with operating as a publicly held company, and with purchasing the computer equipment necessary for Year 2000 compliance. Income Taxes. Income tax expense was $29,000 and $17,000 for the six month periods ended December 31, 1998 and 1997, respectively. The fluctuations were primarily attributable to corresponding fluctuations in income before income taxes. CAPITAL RESOURCES AND LIQUIDITY The term "liquidity" generally refers to an organization's ability to generate adequate amounts of funds to meet its needs for cash. More specifically for financial institutions, liquidity ensures that adequate funds are available to meet deposit withdrawals, fund loan and capital expenditure commitments, maintain reserve requirements, pay operating expenses and provide funds for debt service, dividends to stockholders and other institutional commitments. Funds are primarily provided through the sale or maturity of investments, the ability to raise equity capital, or maintenance of shorter-term interest-bearing deposits. -8- ANSON BANCORP, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - -------------------------------------------------------------------------------- As a state chartered stock savings bank, Anson Savings Bank must maintain liquidity in the form of cash and cash equivalents and investment securities, including mortgage-backed securities, equal to at least 10% of total assets. The Bank's liquidity ratio at December 31, 1998 was considerably in excess of such requirements. Given its excess liquidity and its ability to borrow from the Federal Home Loan Bank, the Bank believes that it will have sufficient funds available to meet anticipated future loan commitments, deposit withdrawals and other cash requirements. YEAR 2000 The Company recognizes that there is a business risk in computerized systems as the calendar rolls over into the next century. The Federal Financial Institutions Examination Council (FFIEC) issued an interagency statement on May 5, 1997 outlining five phases for institutions to effectively manage the Year 2000 challenge. The phases were: Awareness, Assessment, Renovation, Validation, and, Implementation. The FFIEC encouraged institutions to have all critical applications identified and priorities set by December 31, 1997 and to have renovation work largely completed and testing well underway by December 31, 1998. The Company has an ongoing program designed to ensure that its operational and financial systems will not be adversely affected by Year 2000 software failures, due to processing errors arising from calculations using the Year 2000 date. The Company's vaults are mechanical and are not subject to time or calendar failure. The Board of Directors and management of the Company have established Year 2000 compliance as a strategic initiative. While the Company believes that it has available resources to assure Year 2000 compliance, it is to some extent dependent on vendor cooperation. At the present time, the Company expects its most critical application software vendor to have all of its systems in compliance. The Company has installed the necessary software releases and expects to have testing of such systems substantially completed by March 31, 1999 and have any problems reconciled by June 30, 1999. At this time, the Company has not fully determined the cost of making modifications to correct any Year 2000 problems; however, equipment and software expenses are not expected to materially differ from past results. The Company routinely upgrades and purchases technologically advanced software and hardware on a continual basis and expects to specifically evaluate and test such purchases for Year 2000 compliance. The Company's loan portfolio consists primarily of residential mortgage loans to individuals. These individuals generally are not affected by Year 2000 failures. The Bank currently makes very few commercial loans. If the Bank increases its commercial loan portfolio, the Bank's Board of Directors would amend its underwriting policies to address loan payment problems associated with a borrower as a result of a disruption in income or a commercial borrower's inability to make a timely payment. -9- ANSON BANCORP, INC. PART II - OTHER INFORMATION - -------------------------------------------------------------------------------- Item 1. Legal Proceedings The Company is not engaged in any legal proceedings at the present time. From time to time, the Bank is a party to legal proceedings within the normal course of business wherein it enforces its security interest in loans made by it, and other matters of a like kind. 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 Not applicable Item 6. Exhibits and Reports on Form 8-K a) Exhibit (27) - Financial Data Schedule b) Not applicable -10- 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. Anson Bancorp, Inc. Dated: 2/12/99 By: /s/ Eugene M. Ward ---------------- -------------------------- Eugene M. Ward President Dated: 2/12/99 By: /s/ Nancy H. Allen ---------------- -------------------------- Nancy H. Allen Treasurer and Assistance Secretary -11- EX-27 2 EXHIBIT 27
9 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM *______________________ AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. *Identify the financial statement(s) to be referenced in the legend: 1,000 6-MOS 6-MOS JUN-30-1999 JUN-30-1998 JUL-01-1998 JUL-01-1997 DEC-31-1998 DEC-31-1997 157 172 3,339 3,289 525 750 0 0 585 380 8,395 4,374 0 0 11,467 11,323 104 100 24,928 20,723 15,147 16,656 0 0 212 208 0 0 0 0 0 0 5,425 0 4,144 3,859 24,928 20,723 462 475 336 243 0 0 798 718 371 412 0 0 427 306 2 0 0 0 310 227 115 79 115 79 0 0 0 0 86 62 0.15 0 0.15 0 3.49 3.09 0 0 152 312 0 0 0 0 104 100 0 0 0 0 104 100 104 100 0 0 0 0
-----END PRIVACY-ENHANCED MESSAGE-----