-----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, QpMYQRFY7LcWcfl0rulCJmOjRfE/WeoTNGFq+n9nGlfhRzvhJ5pz7o7/Vl/Kjw6G 0rGfjxHB2wHT1h7iVAVzmQ== 0000914317-01-500484.txt : 20020410 0000914317-01-500484.hdr.sgml : 20020410 ACCESSION NUMBER: 0000914317-01-500484 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010930 FILED AS OF DATE: 20011114 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CCBT FINANCIAL COMPANIES INC CENTRAL INDEX KEY: 0001074972 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 043437708 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 333-72565 FILM NUMBER: 1789949 BUSINESS ADDRESS: STREET 1: 495 STATION AVENUE CITY: SOUTH YARMOUTH STATE: MA ZIP: 02601 BUSINESS PHONE: 5087608323 MAIL ADDRESS: STREET 1: 495 STATION AVENUE CITY: SOUTH YARMOUTH STATE: MA ZIP: 02601 FORMER COMPANY: FORMER CONFORMED NAME: CCBT BANCORP INC DATE OF NAME CHANGE: 19981209 10-Q 1 form10q41143_11-10.txt 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, 2001 Commission File No. 000-25381 CCBT FINANCIAL COMPANIES, INC. (Exact name of Registrant as specified in its charter) Massachusetts 04-3437708 (State of Incorporation) (I.R.S. Employer Identification No.) 495 Station Avenue, South Yarmouth, Massachusetts 02664 (Address of principal executive office) (Zip Code) (Registrant's telephone #, incl. area code): 508-394-1300 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. (1): [X] Yes [_] No Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date. There were 8,620,423 shares of common stock outstanding as of November 9, 2001. TABLE OF CONTENTS
Section Description Page No. PART I FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Statements of Financial Condition 3 September 30, 2001 (Unaudited) and December 31, 2000 Consolidated Statements of Income (Unaudited) 4 Three and Nine Months Ended September 30, 2001 and 2000 Consolidated Statements of Cash Flows (Unaudited) 5 Nine Months Ended September 30, 2001 and 2000 Consolidated Statements of Comprehensive Income (Unaudited) 6 Nine Months Ended September 30, 2001 and 2000 Consolidated Statements of Changes in Stockholders' Equity (Unaudited) 6 Nine Months Ended September 30, 2001 and 2000 Notes to Consolidated Financial Statements 7 Item 2. Management's Discussion and Analysis of Financial Condition 7-18 and Results of Operations Item 3. Quantitative and Qualitative Disclosures About Market Risk 19 PART II OTHER INFORMATION Item 1. Legal Proceedings 19 Item 2. Changes in Securities and Use of Proceeds 19 Item 3. Defaults upon Senior Securities 19 Item 4. Submission of Matters to a Vote of Security Holders 19 Item 5. Other Information 19 Item 6. Exhibits and Reports on Form 8-K 19 SIGNATURES 20
2 PART I FINANCIAL INFORMATION ITEM 1. Financial Statements CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
September 30, December 31, 2001 2000 ---- ---- (Unaudited) ASSETS Cash and due from banks $ 33,709,066 $ 49,371,492 Short term interest-bearing deposits 457,442 16,843,538 Securities available for sale at fair value 508,669,050 426,742,801 Federal Home Loan Bank stock, at cost 22,125,400 22,125,400 Federal Reserve Bank stock, at cost 1,235,050 1,180,700 Total loans 877,360,089 848,490,319 Less: Reserve for loan losses (12,165,917) (12,153,944) --------------- --------------- Net loans 865,194,172 836,336,375 Loans held for sale 623,225 860,840 Premises and equipment 17,920,402 16,633,912 Deferred tax assets 1,769,330 4,512,589 Accrued interest receivable on securities 3,070,442 3,353,580 Principal and interest receivable on loans 4,306,330 4,331,987 Intangibles 8,367,922 9,555,425 Other assets 16,760,759 12,070,707 --------------- --------------- Total assets $ 1,484,208,590 $ 1,403,919,346 =============== =============== LIABILITIES AND STOCKHOLDERS' EQUITY Deposits $ 935,432,739 $ 973,302,664 Borrowings from the Federal Home Loan Bank 370,926,054 291,286,797 Other short-term borrowings 35,453,049 24,520,157 Subordinated debt 5,000,000 -- Current taxes payable 934,427 2,267,117 Interest payable on deposits and borrowings 2,583,037 4,206,555 Post retirement benefits payable 3,188,675 2,830,386 Employee profit sharing retirement and bonuses payable 2,292,844 2,946,642 Due to broker securities settlement account 12,107,571 756,617 Other liabilities 3,786,733 2,949,198 --------------- --------------- Total liabilities 1,371,705,129 1,305,066,133 --------------- --------------- Minority interest 29,097 124,435 --------------- --------------- Stockholders' equity Common stock, $1.00 par value: Authorized: 12,000,000 shares Issued: 9,061,064 shares 9,061,064 9,061,064 Surplus 27,473,395 27,494,890 Undivided profits 79,476,177 69,896,759 Treasury stock, at cost (440,641 shares in 2001) (7,197,493) (7,399,628) (453,016 shares in 2000) Accumulated other comprehensive income (loss) 3,661,221 (324,307) --------------- --------------- Total stockholders' equity 112,474,364 98,728,778 --------------- --------------- Total liabilities and stockholders' equity $ 1,484,208,590 $ 1,403,919,346 =============== ===============
The accompanying notes are an integral part of these unaudited, consolidated financial statements. 3 PART I FINANCIAL INFORMATION ITEM 1. Financial Statements (continued) CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended Sept. 30, Nine Months Ended Sept. 30, 2001 2000 2001 2000 ---- ---- ---- ---- INTEREST INCOME: (Unaudited) (Unaudited) Interest and fees on loans $ 16,730,597 $ 15,900,554 $ 51,319,096 $ 44,334,344 Interest on short term interest-bearing deposits 121,768 356,103 445,463 659,053 Interest on federal funds sold -- 29,975 -- 29,975 Taxable interest income on securities 5,757,443 7,339,386 20,917,500 21,873,218 Tax-exempt interest income on securities 255,465 264,348 722,350 690,810 Dividends on securities 328,445 451,558 1,108,860 1,298,480 ------------ ------------ ------------ ------------ Total interest income 23,193,718 24,341,924 74,513,269 68,885,880 ------------ ------------ ------------ ------------ INTEREST EXPENSE Interest on deposits 5,116,844 7,636,029 19,638,064 17,901,379 Interest on borrowings from the Federal Home Loan Bank 4,858,045 3,487,223 15,464,756 14,417,815 Interest on other short-term borrowings 198,133 412,674 674,897 1,003,120 Interest on subordinated debt 63,677 -- 63,677 -- ------------ ------------ ------------ ------------ Total interest expense 10,236,699 11,535,926 35,841,394 33,322,314 ------------ ------------ ------------ ------------ Net interest income 12,957,019 12,805,998 38,671,875 35,563,566 Provision for loan losses -- -- -- -- ------------ ------------ ------------ ------------ Net interest income after provision for loan losses 12,957,019 12,805,998 38,671,875 35,563,566 ------------ ------------ ------------ ------------ NON-INTEREST INCOME Financial Advisor fees 1,574,269 1,442,366 5,222,500 4,779,861 Deposit account service charges 523,051 495,650 1,564,688 1,469,236 Branch banking fees 804,882 832,337 2,342,191 2,312,947 Electronic banking fees 493,683 429,933 1,451,848 1,428,785 Loan servicing and other loan fees 27,558 39,330 129,750 225,233 Brokerage fees and commissions 230,741 218,575 720,192 752,216 Net gain on sales of securities 292,426 44,931 1,144,983 73,233 Net gain on sales of loans 1,770,946 31,144 2,192,986 58,798 Insurance commissions 471,316 304,722 1,358,057 499,315 Other income 219,549 150,278 607,259 419,224 ------------ ------------ ------------ ------------ Total non-interest income 6,408,421 3,989,266 16,734,454 12,018,848 ------------ ------------ ------------ ------------ NON-INTEREST EXPENSE Salaries 4,496,761 3,799,920 12,824,169 10,486,815 Employee benefits 1,687,779 1,624,850 5,226,034 4,610,371 Building and equipment 1,426,065 1,277,941 4,177,169 3,566,320 Data processing 830,660 759,273 2,417,640 2,201,146 Accounting and legal fees 231,506 209,846 704,266 671,530 Other outside services 609,009 509,830 1,707,234 1,547,574 Amortization of intangibles 395,833 395,835 1,187,499 455,609 Delivery and communications 586,781 386,234 1,582,829 1,129,960 Directors' fees 85,800 86,250 257,400 262,000 Marketing and advertising 392,854 318,103 1,332,585 842,407 Printing and supplies 222,802 210,845 668,554 604,052 Insurance 111,948 98,081 359,336 286,324 Branch conversion expenses -- 249,808 -- 249,808 All other expenses 518,594 308,282 1,291,090 1,273,114 ------------ ------------ ------------ ------------ Total operating expense 11,596,392 10,235,098 33,735,805 28,187,030 ------------ ------------ ------------ ------------ Minority interest 7,780 (6,917) 2,196 (17,413) ------------ ------------ ------------ ------------ Net income before taxes 7,761,268 6,567,083 21,668,328 19,412,797 Applicable income taxes 2,749,161 2,199,774 7,440,565 6,591,100 ------------ ------------ ------------ ------------ Net income $ 5,012,107 $ 4,367,309 $ 14,227,763 $ 12,821,697 ============ ============ ============ ============ Average shares outstanding 8,615,738 8,608,048 8,610,640 8,608,048 Basic earnings per share $ 0.58 $ 0.51 $ 1.65 $ 1.49 Diluted earnings per share $ 0.58 $ 0.51 $ 1.65 $ 1.49 Cash dividends declared $ 0.18 $ 0.16 $ 0.54 $ 0.48
The accompanying notes are an integral part of these unaudited, consolidated financial statements. 4 PART I FINANCIAL INFORMATION ITEM 1. Financial Statements (continued) CONSOLIDATED STATEMENTS OF CASH FLOWS For the Nine Months Ended September 30,
2001 2000 ---- ---- (Unaudited) CASH PROVIDED BY OPERATING ACTIVITIES Net income $ 14,227,763 $ 12,821,697 Adjustments to reconcile net income to net cash provided by operating activities: Provision for loan losses -- -- Depreciation and amortization 3,067,370 1,726,808 Net amortization of securities 4,015,751 5,126,638 Accretion of deferred loan fees (430,380) (97,509) Net gain on sale of investment securities (1,144,983) (73,233) Prepaid income tax expense (4,075,949) (1,046,754) Net gain on sale of loans (2,192,986) (58,798) Net change in: Loans held for sale 237,615 35,230 Accrued interest receivable 308,795 (1,402,854) Accrued expenses and other liabilities 10,269,462 1,046,526 Other, net (4,752,749) (2,986,764) ------------- ------------- Net cash provided by operating activities 19,529,709 15,090,987 ------------- ------------- CASH USED BY INVESTING ACTIVITIES Net increase in loans (137,220,055) (130,355,375) Proceeds from sale of loans 110,375,126 8,749,600 Dispositions of property from defaulted loans -- 70,000 Maturities of securities 321,793,992 546,702,601 Purchases of available for sale securities (479,927,573) (783,033,661) Sales of available for sale securities 84,746,392 297,988,862 Purchases of premises and equipment (4,399,992) (5,608,672) ------------- ------------- Net cash used by investing activities (104,632,110) (65,486,645) ------------- ------------- CASH PROVIDED BY FINANCING ACTIVITIES Net (decrease) increase in deposits (37,869,925) 217,412,024 Net increase (decrease) in borrowings from the Federal Home Loan Bank 79,639,257 (135,427,962) Net increase in other short-term borrowings 10,932,892 12,851,082 Proceeds from issuance of Subordinated debt 5,000,000 -- Cash dividends paid on common stock (4,648,345) (4,136,183) ------------- ------------- Net cash provided by financing activities 53,053,879 90,698,961 ------------- ------------- Net (decrease) increase in cash and cash equivalents (32,048,522) 40,303,303 Cash and cash equivalents at beginning of year 66,215,030 45,622,428 ------------- ------------- Cash and cash equivalents at end of period $ 34,166,508 $ 85,925,731 ============= ============= SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Cash paid for: Interest $ 37,528,588 $ 33,085,019 Income taxes 8,779,819 7,067,843 Non-cash transactions: Additions to property from defaulted loans $ -- $ 70,000
The accompanying notes are an integral part of these unaudited, consolidated financial statements. 5 PART I FINANCIAL INFORMATION ITEM 1. Financial Statements (continued) CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME For the Nine Months Ended September 30,
2001 2000 ---- ---- (Unaudited) Net income $ 14,227,763 $ 12,821,697 ------------ ------------ Unrealized holding gains (losses) on securities available for 7,956,354 (356,893) sale Reclassification of gains on securities realized in income (1,144,983) (73,233) ------------ ------------ Net unrealized gains (losses) 6,811,371 (430,126) Related tax effect (2,825,843) 144,743 ------------ ------------ Net other comprehensive income (loss) 3,985,528 (285,383) ------------ ------------ Comprehensive income $ 18,213,291 $ 12,536,314 ============ ============
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY For the Nine Months Ended September 30,
2001 2000 ---- ---- (Unaudited) COMMON STOCK Balance, beginning of the year $ 9,061,064 $ 9,061,064 ------------- ------------- Balance, September 30 9,061,064 9,061,064 ------------- ------------- SURPLUS Balance, beginning of the year 27,494,890 27,494,890 Issuance of common stock under stock option plan (21,495) -- ------------- ------------- Balance, September 30 27,473,395 27,494,890 ------------- ------------- UNDIVIDED PROFITS Balance, beginning of the year 69,896,759 58,181,480 Net income 14,227,763 12,821,697 Cash dividends declared (4,648,345) (4,136,183) ------------- ------------- Balance, September 30 79,476,177 66,866,994 ------------- ------------- TREASURY STOCK Balance, beginning of the year (7,399,628) (7,399,628) Issuance of common stock under stock option plan 202,135 -- ------------- ------------- Balance, September 30 (7,197,493) (7,399,628) ------------- ------------- ACCUMULATED OTHER COMPREHENSIVE INCOME Balance, beginning of the year (324,307) (1,688,195) Net other comprehensive income (loss) 3,985,528 (285,383) ------------- ------------- Balance, September 30 3,661,221 (1,973,578) ------------- ------------- TOTAL STOCKHOLDERS' EQUITY $ 112,474,364 $ 94,049,742 ============= =============
The accompanying notes are an integral part of these unaudited, consolidated financial statements. 6 PART I FINANCIAL INFORMATION ITEM 1. Financial Statements (continued) CCBT FINANCIAL COMPANIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Nine Months Ended September 30, 2001 and 2000 (Unaudited) Business CCBT Financial Companies, Inc. ("Company") was incorporated under the laws of the Commonwealth of Massachusetts on October 8, 1998 under the name of CCBT Bancorp, Inc. at the direction of the Board of Directors and management of Cape Cod Bank and Trust Company ("Bank") for the purpose of becoming a bank holding company for the Bank. On February 11, 1999, Bancorp became the holding company for the Bank by acquiring 100% of the outstanding shares of the Bank's common stock in a 1:1 exchange for Bancorp common stock. During 1999, the Company's name was changed to CCBT Financial Companies, Inc. The Bank's charter was converted to that of a national bank effective September 1, 1999. Currently, the Company's business activities are conducted primarily through the Bank. During the second quarter of 2000, the Company, through its wholly-owned subsidiary, Cape Cod Bank and Trust Company N.A., acquired 51% of the stock of Murray & MacDonald Insurance Services, Inc. (the "Agency") of Falmouth, Massachusetts, a full service insurance agency offering property, casualty, life, accident and health products to clients on Cape Cod. The Agency has been in business since 1972 and has license agreements with more than thirty insurance firms. As part of the transaction, Murray & MacDonald President Douglas D. MacDonald will continue as President of the Agency, and will direct all insurance activities for the Bank. In addition to the acquisition of Murray & MacDonald Insurance Services, Inc., the Company also completed its acquisition of two branch banking offices, in Falmouth and Wareham, Massachusetts, from Fleet Bank during the second quarter of 2000. These branches added approximately $55 million in deposits at a 15.5% premium, at June 30, 2000. Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 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. Certain amounts have been reclassified in the September 30, 2000 financial statements to conform to the 2001 presentation. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2001 are not necessarily indicative of the results that may be expected for the current fiscal year. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's annual report on Form 10-K for the year ended December 31, 2000. ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations General This Form 10Q contains certain statements that may be considered 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. The Company's actual results could differ materially from those projected in the forward-looking statements as a result, among other factors, of changes in general, national or regional economic conditions, changes in loan default and charge-off rates, reductions in deposit levels necessitating increased borrowing to fund loans and investments, changes in interest rates, changes in the size and nature of the Company's competition, and changes in the assumptions used in making such forward-looking statements. 7 PART I FINANCIAL INFORMATION ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued) The following discussion should be read in conjunction with the accompanying consolidated financial statements and selected consolidated financial data included within this report. Given that the Company's principal activity currently is ownership of the Bank, for ease of reference, the term "Company" in this item generally will refer to the investments and activities of the Company and the Bank except where otherwise noted. CCBT Financial Companies, Inc. is a bank holding company. The Company is the sole stockholder of Cape Cod Bank and Trust Company, N.A. which is the largest commercial bank headquartered in Barnstable County. It offers a wide range of commercial banking services for individuals, businesses, non-profit organizations, governmental units and fiduciaries. The Bank receives substantially all of its deposits from and makes substantially all of its loans to individuals and businesses on Cape Cod, although the Bank has some loans on properties outside its market area, including some sizable participations in commercial mortgages. The Bank's core market is comprised of retail, wholesale, and manufacturing businesses; primary households (including a significant retirement population); and a growing number of second homeowners. In addition, a substantial non-core vacation population contributes to seasonal deposit growth. The Company's only subsidiary other than the Bank is CCBT Statutory Trust I. (The remainder of this page intentionally left blank.) 8 PART I FINANCIAL INFORMATION ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (cont.)
Net Interest Income, Net Interest Margin Three Months Ended September 30, ------------------------------------------------------------------------------- 2001 2000 ----------------------------------- ---------------------------------- Average Average Average Average Balance Interest Yield Balance Interest Yield ----------------------------------- ---------------------------------- (Dollar amounts in thousands) ASSETS Securities: Mortgage-backed securities $ 19,858 $ 306 6.17% $ 25,380 $ 477 7.52% CMOs 188,609 2,466 5.23% 167,842 3,255 7.76% U.S. Government agencies 12,777 172 5.46% 25,935 454 7.12% State and municipal obligations 26,321 255 5.12% 20,288 256 6.67% Other securities 244,412 3,264 5.34% 214 826 4,000 7.45% ----------- ------- ---------- ------- Total securities 491,977 6,463 5.32% 454,271 8,442 7.51% ----------- ------- ---------- ------- Loans: Commercial 84,930 1,699 7.83% 72,479 1,796 9.70% Commercial construction 51,533 922 7.00% 35,152 842 9.37% Residential construction 48,173 776 6.44% 57,747 943 6.53% Commercial mortgages 252,175 5,461 8.47% 220,570 5,158 9.15% Industrial revenue bonds 1,246 19 8.71% 1,716 34 11.07% Residential mortgages 431,542 6,820 6.32% 343,793 6,025 7.01% Home equity 46,231 817 7.01% 34,269 858 9.96% Consumer 8,514 217 10.74% 9,443 244 10.28% ----------- ------- ---------- ------- Total loans 924,344 16,731 7.16% 775,169 15,900 8.12% ----------- ------- ---------- ------- Total earning assets 1,416,321 23,194 6.51% 1,229,440 24,342 7.90% ------- ------- Cash and due from banks 39,432 38,932 Non-earning assets 26,749 32,499 ----------- ---------- Total assets $ 1,482,502 $1,300,871 =========== ========== LIABILITIES & STOCKHOLDERS' EQUITY Deposits: NOW accounts $ 143,054 172 0.48% $ 133,146 244 0.73% Regular savings 148,212 756 2.02% 148,456 1,159 3.11% Money Market accounts 180,293 1,202 2.65% 165,402 1,617 3.89% Certificates of Deposit of $100,000 or more 62,979 736 4.64% 111,955 1,874 6.66% Other time deposits 176,316 2,251 5.06% 177,767 2,741 6.13% ----------- ------- ---------- ------- Total interest bearing deposits 710,854 5,117 2.86% 736,726 7,635 4.12% ----------- ------- ---------- ------- Borrowings: Federal Home Loan Bank 391,857 4,857 4.92% 217,149 3,488 6.39% Other short-term borrowings 34,825 263 2.98% 29,016 413 5.66% ----------- ------- ---------- ------- Total borrowings 426,682 5,120 4.76% 246,165 3,901 6.30% ----------- ------- ---------- ------- Total interest-bearing liabilities 1,137,536 10,237 3.57% 982,891 11,536 4.67% ------- ------- Demand deposits 229,346 221,020 Non-interest bearing liabilities 7,789 6,971 Stockholders' equity 107,831 89,989 ----------- ---------- Total liabilities & equity $ 1,482,502 $1,300,871 =========== ========== Net interest income/spread $12,957 2.94% $12,806 3.23% ======= ======= Net interest margin (NII/Avg. Earning Assets) 3.63% 4.14%
9 PART I FINANCIAL INFORMATION ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (cont.) RESULTS OF OPERATIONS Three Months Ended September 30, 2001 vs. September 30, 2000 Source and Use of Funds Borrowings from the Federal Home Loan Bank were the primary source of funds during the third quarter of 2001, resulting in an increase of 80.5% or $174.7 million, on average, when compared to the same quarter of 2000. Average interest bearing deposits were lower by 3.5% or $25.9 million in the third quarter of 2001 as compared to 2000. A significant reduction occurred in Certificates o f Deposit of $100,000 or more which decreased 43.7% or $49.0 million during the third quarter of 2001 when compared to the same quarter of 2000. This reduction can be attributed to the maturity of a significant amount of one year certificates of deposit during the third quarter of 2001. In contrast, average interest bearing transaction accounts increased for the third quarter of 2001 as compared to 2000 with Money Market accounts up $14.9 million or 9.0% and NOW accounts increasing $9.9 million or 7.4%. Average Non-interest bearing demand deposits increased 3.8% or $8.3 million for the third quarter of 2001 as compared to 2000. On average, securities were higher by $37.7 million or 8.3% during the third quarter of 2001 when compared to the third quarter of 2000 with significant growth occuring in the Other Securities category which increased $29.6 million or 13.8% and in CMO's which increased $20.8 million or 12.4%. When compared to the third quarter of 2000, average loans were higher in 2001 by 19.2% or $149.2 million. Loan growth was spearheaded by residential mortgage lending, up $87.7 million or 25.5% in a very active local market. On average commercial construction and mortgage loans also increased in the third quarter of 2001 by $48.0 million or 18.8% when compared to the same period in the prior year. Net interest income Net interest income was $13.0 million for the three months ended September 30, 2001 as compared to $12.8 million for the same period in 2000, up 1.2%. The spread and net interest margin ratios were 2.94% and 3.63%, respectively, for the three months ended September 30, 2001 as compared to 3.23% and 4.14%, respectively, for the comparable 2000 period. Provision for loan losses A slowing economy increased management's concern regarding the potential for future loan losses. However, seasonal paydowns of commercial loans and the sale of residential mortgages decreased the size of the loan portfolio. Accordingly on balance no provisions were made to the reserve for loan losses in the quarters ended September 30, 2001 or 2000. Management believes that, upon continuing review of loan payment and quality statistics, the current reserve continues to be adequate to cover losses likely to result from loans in the current portfolio. Non-interest Income and Expense Non-interest income totaled $6.4 million for the three months ended September 30, 2001, up 60.6% compared to the $4.0 million earned during the same period in 2000. Net gains on the sale of Residential Mortgage loans contributed $1.7 million to this increase while net gains on the sale of securities increased $247 thousand. Financial Advisor Fees increased $132 thousand despite the negative effects of the Stock Market decline, reflecting a significant increase in new business while insurance commissions, largely due to referrals of bank customers, have increased $167 thousand. During the third quarter of 2001, non-interest expenses totaled $11.6 million, greater than the $10.2 million expended during the comparable period last year by $1.4 million or 13.3%. Salaries and employee benefits rose $760 thousand or 14.0%, with $404 thousand of this increase attributable to commissions. Increased expenses in other categories include delivery and communications expenses, and building and equipment expenses. These increases are a result of increased utilities costs, real estate tax increases, and a significant increase in amortization expense of computer software. 10 PART I FINANCIAL INFORMATION ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (cont.) Income taxes Applicable State and Federal income tax expense of $2.7 million for the quarter ended September 30, 2001 was 24.9% more than the $2.2 million recorded for the same quarter in 2000, a reflection of higher pretax net income. The combined effective State and Federal tax rate was 35% and 34% of pretax net income for the third quarter of 2001 and 2000, respectively. Net income Consolidated net income was $5.0 million representing earnings per share of $0.58 for the three months ended September 30, 2001 as compared to $4.4 million or $0.51 per share for the comparable three months ended September 30, 2000. Annualized returns on average assets and average equity were 1.34% and 18.44%, respectively, for the three months ended September 30, 2001 as compared to 1.34% and 19.31%, respectively, for the three months ended September 30, 2000. (The remainder of this page intentionally left blank.) 11 PART I FINANCIAL INFORMATION ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (cont.)
Net Interest Income, Net Interest Margin Nine Months Ended September 30, ------------------------------------------------------------------------------- 2001 2000 ----------------------------------- ---------------------------------- Average Average Average Average Balance Interest Yield Balance Interest Yield ----------------------------------- ---------------------------------- (Dollar amounts in thousands) ASSETS Securities: Mortgage-backed securities $ 31,263 $ 1,525 6.50% $ 29,519 $ 1,697 7.67% CMOs 184,507 8,748 6.32% 187,961 10,274 7.29% U.S. Government agencies 16,963 682 5.43% 27,899 1,369 6.65% State and municipal obligations 22,851 736 5.66% 20,233 691 6.02% Other securities 250,629 11,503 6.12% 205,186 10,521 6.84% ----------- ------- ---------- ------- Total securities 506,213 23,194 6.17% 470,798 24,552 7.02% ----------- ------- ---------- ------- Loans: Commercial 86,140 5,456 8.35% 79,584 5,754 9.50% Commercial construction 47,362 2,790 7.77% 28,483 2,005 9.25% Residential construction 48,841 2,365 6.46% 52,396 2,486 6.33% Commercial mortgages 244,867 16,418 8.84% 216,032 14,823 9.02% Industrial revenue bonds 1,369 73 9.97% 1,297 82 11.87% Residential mortgages 415,807 21,049 6.75% 317,450 16,390 6.88% Home equity 42,196 2,508 7.95% 29,252 2,117 9.67% Consumer 8,579 660 10.28% 9,161 677 9.87% ----------- ------- ---------- ------- Total loans 895,161 51,319 7.61% 733,655 44,334 8.00% ----------- ------- ---------- ------- Total earning assets 1,401,374 74,513 7.11% 1,204,453 68,886 7.56% ------- ------- Cash and due from banks 37,942 34,444 Non-earning assets 29,585 24,792 ----------- ---------- Total assets $ 1,468,901 $1,263,689 =========== ========== LIABILITIES & STOCKHOLDERS' EQUITY Deposits: NOW accounts $ 137,959 577 0.56% $ 121,475 680 0.75% Regular savings 143,998 2,616 2.43% 149,684 3,463 3.09% Money Market accounts 168,888 3,954 3.13% 148,750 4,083 3.67% Certificates of Deposit of $100,000 or more 96,856 4,197 5.79% 79,413 3,687 6.20% Other time deposits 192,008 8,294 5.78% 141,504 5,988 5.65% ----------- ------- ---------- ------- Total interest bearing deposits 739,709 19,638 3.55% 640,826 17,901 3.73% ----------- ------- ---------- ------- Borrowings: Federal Home Loan Bank 383,134 15,464 5.40% 315,825 14,418 6.10% Other short-term borrowings 29,055 739 3.40% 24,680 1,003 5.43% ----------- ------- ---------- ------- Total borrowings 412,189 16,203 5.26% 340,505 15,421 6.05% ----------- ------- ---------- ------- Total interest-bearing liabilities 1,151,898 35,841 4.16% 981,331 33,322 4.54% ------- ------- Demand deposits 205,908 186,769 Non-interest bearing liabilities 8,168 7,644 Stockholders' equity 102,927 87,945 ----------- ---------- Total liabilities & equity $1,468,901 $1,263,689 ========== ========== Net interest income/spread $38,672 2.95% $35,564 3.02% ======= ======= Net interest margin (NII/Avg. Earning Assets) 3.69% 3.94%
12 PART I FINANCIAL INFORMATION ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (cont.) RESULTS OF OPERATIONS Nine Months Ended September 30, 2001 vs. September 30, 2000 Source and Use of Funds Average interest bearing deposits increased $98.9 million or 15.4% when comparing the first nine months of 2001 with the same period in 2000. Significant growth occurred in average Time deposits with Certificates of Deposit greater than $100,000 increasing $17.4 million or 22.0%, and Other time deposits increasing $50.5 million or 35.7%. Interest bearing transaction accounts also increased in the 2001 period with Money Market accounts up 13.5% or $20.1 million and NOW accounts up 13.6% or $16.5 million. Non-interest bearing demand deposits increased $19.1 million or 10.2% on average, in the first nine months of 2001 when compared to the same period in 2000. Additional funds were raised through increased borrowings from the Federal Home Loan Bank, up $67.3 million or 21.3% in the 2001 period when compared to the same period of 2000. When compared to the first nine months of 2000, average loans were higher in 2001 by $161.5 million or 22.0%. Residential mortgages contributed significantly to this growth, up $98.4 million or 31.0%, while commercial construction and mortgage loans increased $47.7 million or 19.5%. Additionally, Home Equity loans were up $12.9 million for a 44.2% increase for the first nine months of 2001 as compared to 2000. On average, Securities increased $35.4 million or 7.5% during the first nine months of 2001 when compared to the same period in 2000, with growth in Other Securities of $45.4 million, or 22.1%, while U. S. Government agencies declined $10.9 million or 3.9%. Net interest income Net interest income was $38.7 million for the nine months ended September 30, 2001 as compared to $35.6 million for the same period in 2000 up 8.7%. The spread and net interest margin ratios were 2.95% and 3.69%, respectively, for the nine months ended September 30, 2001 as compared to 3.02% and 3.94%, respectively, for the comparable 2000 period. Provision for loan losses Although the size of the loan portfolio grew during the nine months ended September 30, 2001 and there was increasing concern about the possible effects of a weakening economy, non-performing assets declined during this period and recoveries on loans previously charged off exceeded new charge-offs. Accordingly on balance no provisions were made to the reserve for loan losses in the nine months ended September 30, 2001 or 2000. Management believes that, upon continuing review of loan payment and quality statistics, the current reserve continues to be adequate to cover losses likely to results from loans in the current portfolio. Non-interest Income and Expense Non-interest income totaled $16.7 million for the nine months ended September 30, 2001, up 39.2% compared to the $12.0 million earned during the same period in 2000. Of this increase $1.1 million and $2.2 million, respectively, can be attributable to net gains on the sale of securities and loans. Insurance commissions have increased $859 thousand compared to prior year results which only included the agency's revenues from the date of purchase. However, the increase in insurance commissions also reflects the positive impact of the referral of bank customers to the agency. During the first nine months of 2001, non-interest expenses totaled $33.7 million, greater than the $28.2 million expended during the comparable period last year by $5.5 million or 19.7%. Salaries and employee benefits rose $3.0 million or 19.6% with commissions accounting for $884 thousand of this increase and salaries, in line with Management expectations, increasing $1,723 thousand. Increased expenses in other categories include amortization of intangibles for acquisitions completed during the second quarter of 2000, building and equipment expenses for additional locations and depreciation and amortization related to upgraded computer equipment and software, and marketing and advertising costs incurred for a campaign to launch the Company's new logo. 13 PART I FINANCIAL INFORMATION ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (cont.) Income taxes Applicable State and Federal income tax expense of $7.4 million for the nine months ended September 30, 2001 was 12.9% greater than the $6.6 million recorded for the same period in 2000, a reflection of higher pretax net income. The combined effective State and Federal tax rate was 34% of pretax net income for each period presented. Net income Consolidated net income was $14.2 million representing earnings per share of $1.65 for the nine months ended September 30, 2001 as compared to $12.8 million or $1.49 per share for the comparable nine months ended September 30, 2000. Annualized returns on average assets and average equity were 1.29% and 18.48%, respectively, for the nine months ended September 30, 2001 as compared to 1.36 % and 19.47%, respectively, for the nine months ended September 30, 2000. COMPARATIVE ANALYSIS OF SELECTED PERIOD-END ASSETS, LIABILITIES AND CAPITAL The Company had $1.48 billion consolidated total assets, $935.4 million deposits and $112.5 million stockholders' equity at September 30, 2001. Its capital to assets ratio was 7.6%, exceeding all regulatory requirements. As compared to reported balances at December 31, 2000, securities available for sale at fair value increased $81.9 million or 19.2%, gross loans increased $28.9 million or 3.4%, deposits decreased $37.9 million or 3.9% and borrowed funds increased $95.6 million or 30.3%. Securities The adjusted cost and estimated market values of securities which the Company classified as available for sale at September 30, 2001 and December 31, 2000 were as follows:
September 30, 2001 ---------------------------------------------------------------------- Gross Gross Estimated Adjusted Unrealized Unrealized Market Cost Gains Losses Value ---------------- ------------------ ---------------- ----------------- (Dollar amounts in thousands) U.S. Government agency CMOs $177,974 $1,879 $ 941 $178,912 Other U.S. Government agencies 13,456 82 13 13,525 Other collateralized mortgage obligations 62,935 2,987 199 65,723 State and municipal obligations 28,676 -- -- 28,676 Other debt securities 219,380 3,023 570 221,833 -------- ------ ------ -------- Totals $502,421 $7,971 $1,723 $508,669 ======== ====== ====== ======== December 31, 2000 ---------------------------------------------------------------------- Gross Gross Estimated Adjusted Unrealized Unrealized Market Cost Gains Losses Value ---------------- ------------------ ---------------- ----------------- (Dollar amounts in thousands) U.S. Government agency CMOs $140,472 $1,412 $2,437 $139,447 Other U.S. Government agencies 22,663 31 200 22,494 Other collateralized mortgage obligations 47,746 526 529 47,743 State and municipal obligations 25,479 3 -- 25,482 Other debt securities 190,946 1,484 853 191,577 -------- ------ ------ -------- Totals $427,306 $3,456 $4,019 $426,743 ======== ====== ====== ========
14 PART I FINANCIAL INFORMATION ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (cont.) Securities available for sale increased $81.9 million, from $426.7 million at December 31, 2000 to $508.7 million at September 30, 2001. Net gains from security sales were $292 thousand and $1,145.0 thousand during the quarter and nine months ended September 30, 2001, respectively, compared to net gains of $45 thousand and $73 thousand, respectively, during the same periods in 2000. Loans The following is a summary of the Company's outstanding loan balances as of the dates indicated: September 30, December 31, 2001 2000 ---- ---- (Dollar amounts in thousands) Mortgage loans on real estate Residential $ 385,516 $ 393,574 Commercial 258,513 242,536 Construction 96,980 87,978 Equity lines of credit 49,095 37,377 Other loans Commercial 78,091 76,275 Industrial revenue bonds 1,223 1,603 Consumer 7,942 9,147 --------- --------- Total loans 877,360 848,490 Less: Reserve for loan losses (12,166) (12,154) --------- --------- Total portfolio loans, net $ 865,194 $ 836,336 ========= ========= Loans held for sale $ 623 $ 861 ========= ========= As shown in the table above, total loans increased $28.9 million or 3.40% to $877.4 million at September 30, 2001 as compared to December 31, 2000, with significant growth occuring in commercial mortgages up $16.0 million, equity lines of credit up $11.7 million, and construction mortgage loans up $9.0 million. New residential mortgage originations of $24.5 million fixed rate and $49.8 million adjustable rate were achieved in the third quarter 2001. During the same period, the Company sold $75.8 million residential mortgages, producing net gains of $1.8 million. Non performing assets and loan loss experience As shown in the following table non-performing assets were $3.4 million or .23% of total assets at September 30, 2001 compared to $3.7 million or .26% of total assets at December 31, 2000. Accrual of interest income on loans is discontinued when it is questionable whether the borrower will be able to pay the principal and interest in full and/or when loan payments are 60 days past due, or 90 days past due if the loan is fully secured by real estate or other collateral held by the Bank.
September 30, December 31, 2001 2000 ------ ------ (Dollar amounts in thousands) Nonaccrual loans $1,891 $2,192 Loans past due 90 days or more and still accruing -- -- Property from defaulted loans 1,500 1,500 ------ ------ Total non-performing assets $3,391 $3,692 ====== ====== Restructured troubled debt performing in accordance with amended terms, not included above $ 227 $ 237 ====== ======
15 PART I FINANCIAL INFORMATION ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (cont.) The following is a summary of the activity in the reserve for loan losses for the indicated periods:
Nine Months Ended September 30, 2001 2000 -------- -------- (Dollar amounts in thousands) Balance, beginning of the period $ 12,154 $ 11,158 Provision for loan losses -- -- Charge-offs (276) (151) Recoveries on loans previously charged off 288 966 -------- -------- Balance, end of the period $ 12,166 $ 11,973 ======== ========
Management believes that, upon review of loan quality and payment statistics, provisions from current income were unnecessary in the indicated periods, notwithstanding growth in the loan portfolio. The reserve represented 1.39% of total loans at September 30, 2001, 1.43% at December 31, 2000, and 1.50% at September 30,2000. Management considers the reserve to be adequate at September 30, 2001, although there can be no assurance that the reserve is adequate or that additional provisions might be necessary. The Company had outstanding commitments to originate new residential and commercial mortgages of $52.9 million at September 30, 2001 and $57.8 million at December 31, 2000 which are not reflected on the consolidated statements of financial condition. Additional unadvanced loan funds are summarized as follows for the indicated periods: September 30, 2001 December 31, 2000 ------------------ ----------------- Commercial loans (Dollar amounts in thousands) Dealer floor plan $ 11,893 $ 9,134 Lines of credit 44,900 46,743 Other 3,713 3,657 Commercial mortgages Construction 25,997 14,129 Other 9,958 2,896 Residential mortgages Home equity 55,620 45,733 Consumer loans Lines of credit 3,010 2,861 -------- -------- Total $155,091 $125,153 ======== ======== 16 PART I FINANCIAL INFORMATION ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (cont.) Deposits The following table is a summary of deposits outstanding as of the dates indicated:
September 30, 2001 December 31, 2000 ------------------ ----------------- (Dollar amounts in thousands) Deposits Demand $223,776 $201,904 NOW 148,549 139,453 Money market 182,604 163,794 Other savings 148,814 143,239 Certificates of deposit greater than $100,000 61,154 96,159 Other time deposits 170,536 228,754 -------- -------- Total deposits $935,433 $973,303 ======== ========
Reflecting the maturity of $25 million in brokered deposits and the seasonal nature of the Cape Cod economy as discussed in "Liquidity" on page 18 herein, total deposits at September 30, 2001 are $37.9 million or 3.9% lower than total deposits at December 31, 2000. Generally, the Company's strategy is to price deposits according to local market rates, offering higher alternative rates based on increasing amounts deposited. Interest rates paid are frequently reviewed and are modified to reflect changing conditions. Borrowed Funds Historically, the Company has selectively engaged in short and long term borrowings from the Federal Home Loan Bank of Boston, and has sold securities under agreements to repurchase, to fund loans and investments. At September 30, 2001, borrowed funds totaled $406.4 million, up 28.7% or $90.6 million compared to borrowed funds at December 31,2000. This increase offsets the seasonal deposit decline described under the section entitled "Deposits" above and contributes to the support of heretofore described loan growth. During the third quarter of 2001, CCBT Statutory Trust I was formed for the purpose of issuing trust preferred securities and investing the proceeds of the sale of these securities in subordinated debentures issued by the Company. A total of $5 million of floating rate Trust Preferred Securities were issued and are scheduled to mature in 2031, callable at the option of the Company after 7/31/06. Distributions on these securities are payable quarterly in arrears on the last day of April, July, October and January. The Trust Preferred Securities are presented in the consolidated statements of financial condition of the Company as Subordinated Debt. The Company records distributions payable on the Trust Preferred Securities as Interest on subordinated debt in its consolidated statements of income. Stockholders' Equity The Company's capital to assets ratio was 7.58% at September 30, 2001 compared to 7.03% at December 31, 2000. The Company (on a consolidated basis) and the Bank are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possible additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company's and the Bank's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and/or the Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. Holding companies, such as the Company, are not subject to prompt corrective action provisions. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts of total and Tier 1 capital (as defined) to average assets (as defined). The following schedule displays these capital guidelines and the ratios of the Company and the Bank as of September 30, 2001. 17 PART I FINANCIAL INFORMATION ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (cont.)
Minimum September 30, 2001 Regulatory ----------------------- Guidelines Company Bank ------------------------------------- Tier 1 leverage capital 4.00% 6.76% 6.85% Tier 1 capital to risk-weighted assets 4.00% 9.59% 9.70% Total capital to risk-weighted assets 8.00% 10.75% 10.87%
The Company's book value at September 30, 2001 was $13.05 per share compared to $11.47 per share at December 31, 2000. LIQUIDITY The Company normally experiences a wide swing in its liquidity each year as a result of the seasonal nature of the economy in its market area. Liquidity is usually high in late summer and early fall and the annual low point is usually in the early spring. The Bank's investment portfolio is of high quality and is highly marketable although a gain or loss would be realized if the market value of securities sold were not equal to their adjusted book value at date of sale. Alternately, the Bank can borrow funds using investment securities as collateral. The Bank has an available line of credit of $5.0 million from the Federal Home Loan Bank of Boston. The Bank may borrow from the Federal Reserve Bank if necessary. ASSET/LIABILITY MANAGEMENT Through the Company's Asset/Liability Management Committee ("ALCO"), which is comprised of senior management and several Directors, the Company monitors the level and general mix of earning assets and interest bearing liabilities, with particular attention to those assets and liabilities which are rate-sensitive. The primary objective of ALCO is to manage interest rate risk in accordance with policies approved by the Board of Directors regarding acceptable levels of interest rate risk, liquidity and capital. The committee meets monthly and sets the rates paid on deposits, approves loan pricing and reviews investment transactions. Given the substantial liquidity from cash flow and maturities of the Company's investment portfolio, the sizable proportion of rate sensitive loans to total loans, and the large core deposit base, ALCO believes the Company to be moderately asset-sensitive to changes in interest rates. Nevertheless, the Company's strategy has included the funding of certain fixed rate loans with medium term borrowed funds in order to mitigate a margin squeeze should interest rates rise. The Cape Cod market is one in which competing financial institutions frequently offer a wide range of yields for similar deposit products. Within this market, the Company finds it necessary, from time to time, to offer higher rates than it would otherwise justify, thereby increasing pressure on net interest income. In order to offset this pressure somewhat, the Company is strategically focusing on customer relationship profitability. NEW ACCOUNTING PRONOUNCEMENTS In June 2001, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 141, Business Combinations, and SFAS No. 142, Goodwill and Other Intangible Assets. These Statements change the accounting for business combinations and goodwill and intangible assets. SFAS No. 141 requires that the purchase method of accounting be used for all business combinations initiated after June 30, 2001. Use of the pooling-of-interests method is prohibited. SFAS No. 142, which is effective January 1, 2002, changes the accounting for goodwill from an amortization method to an impairment-only approach. In addition, this Statement requires that acquired intangible assets, as defined, be amortized over their useful lives. As a result, effective January 1, 2002, the Company's goodwill will no longer be amortized but will be evaluated for impairment and the Company's core deposit intangibles will continue to be amortized over their estimated useful lives. Management is currently evaluating the impact of adopting this Statement on the consolidated financial statements. 18 PART I FINANCIAL INFORMATION ITEM 3. Quantitative and Qualitative Disclosures about Market Risk For a discussion of the Company's management of market risk exposure, see "Asset/Liability Management" in Item 2 of Part I of this report and Item 7A of Part II of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2000 (the "2000 Annual Report"). For quantitative information about market risk, see Item 7A of Part II of the Company's 2000 Annual Report. There have been no material changes in the quantitative and qualitative disclosures about market risk as of September 30, 2001 from those presented in the Company's 2000 Annual Report. PART II OTHER INFORMATION ITEM 1. Legal proceedings There are no material legal proceedings to which the Company is a party or to which any of its property is subject, although the Company is a party to ordinary routine litigation incidental to its business. ITEM 2. Changes in securities and use of proceeds 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) Exhibits None (b) Reports on Form 8-K None 19 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. (Registrant): CCBT Financial Companies, Inc. ---------------------------------------------------------- Date: November 14, 2001 ---------------------------------------------------------- /s/ STEPHEN B. LAWSON, President and Chief Executive Officer --------------------------------------------------------------- Stephen B. Lawson, President and Chief Executive Officer /s/ NOAL D. REID, Chief Financial Officer and Treasurer ---------------------------------------------------------------- Noal D. Reid, Chief Financial Officer and Treasurer 20 -----END PRIVACY-ENHANCED MESSAGE-----