-----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, LpVXsUTaOASxeWctR+itiXWQqqhfxRfH4EzWeZIThEmoMjNQwC7hr/SkauyrenO7 In+lPlD8gsJDgKt0Fdz96Q== 0000351238-00-000003.txt : 20000505 0000351238-00-000003.hdr.sgml : 20000505 ACCESSION NUMBER: 0000351238-00-000003 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000331 FILED AS OF DATE: 20000504 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SAN FRANCISCO CO CENTRAL INDEX KEY: 0000351238 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 943071255 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-10198 FILM NUMBER: 618618 BUSINESS ADDRESS: STREET 1: 550 MONTGOMERY ST CITY: SAN FRANCISCO STATE: CA ZIP: 94111 BUSINESS PHONE: 4157817810 MAIL ADDRESS: STREET 1: PO BOX 2887 CITY: SAN FRANCISCO STATE: CA ZIP: 94126 FORMER COMPANY: FORMER CONFORMED NAME: BANK OF SAN FRANCISCO CO HOLDING CO DATE OF NAME CHANGE: 19920703 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (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, 2000 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-10198 The San Francisco Company (Exact name of Registrant as specified in its charter) Delaware 94-3071255 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 550 Montgomery Street, San Francisco, California 94111 (Address of principal executive office) (Zip Code) (415) 781-7810 (Registrant's telephone number, including area code) None (Former name, former address and former fiscal year, if changed since last report) 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. Yes X No The Registrant had 29,320,725 shares of Class A Common Stock outstanding on May 1, 2000. page The San Francisco Company and Subsidiaries Quarterly Report on Form 10-Q Table of Contents Page Part I - Financial Information Item 1. Consolidated Statements of Financial Condition At March 31, 2000 and December 31, 1999 . . . . . . . . 1 Consolidated Statements of Operations For the Three Months Ended March 31, 2000 and 1999. . . 2 Consolidated Statements of Changes in Shareholders' Equity and Comprehensive Income For the Three Months Ended March 31, 2000 and 1999 . . . . . . . . . . . . . . . . 3 Consolidated Statements of Cash Flows For the Three Months Ended March 31, 2000 and 1999. . . 4 Notes to Consolidated Financial Statements . . . . . . . 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . . . . . . 6 Item 3. Quantitative and Qualitative Disclosures About Market Risk . . . . . . . . . . . . . . . . . . . . . . . . . 11 Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 page Item. 1 - Consolidated Financial Statements The San Francisco Company and Subsidiaries Consolidated Statements of Financial Condition March 31, 2000 (unaudited) and December 31, 1999 March 31, December 31, (Dollars in Thousands Except Per Share Data) 2000 1999 Assets: Cash and due from banks $6,576 $5,265 Federal funds sold 60,673 34,224 Cash and cash equivalents 67,249 39,489 Investment securities held-to-maturity (Market value: 2000 $726; 1999 $1,904) 740 1,953 Investment securities available-for-sale 31,606 32,236 Federal Home Loan Bank stock, at par 2,106 2,077 Loans and leases 100,367 94,612 Deferred fees (202) (140) Allowance for loan and lease losses (1,600) (1,525) Loans and leases, net 98,565 92,947 Premises and equipment, net 7,077 7,151 Operating lease equipment 4,035 4,306 Interest receivable 897 867 Other assets 4,007 3,900 Total Assets $216,282 $184,926 Liabilities and Shareholders' Equity: Non-interest bearing deposits $48,810 $32,676 Interest bearing deposits 122,048 106,235 Total deposits 170,858 138,911 Other borrowings 18,000 20,000 Other liabilities and interest payable 2,180 2,061 Total liabilities 191,038 160,972 Shareholders' Equity: Preferred stock (par value $0.01 per share) Series B - Authorized - 437,500 shares Issued and outstanding - 2000 and 1999 - 15,869 111 111 Common stock (par value $0.01 per share) Class A - Authorized - 100,000,000 shares Issued and outstanding - 2000 and 1999 - 29,317,558 293 293 Additional paid-in capital 76,963 76,963 Retained deficit (51,467) (52,766) Accumulated other comprehensive loss (656) (647) Total shareholders' equity 25,244 23,954 Total Liabilities and Shareholders' Equity $216,282 $184,926 See accompanying notes to unaudited consolidated financial statements. page 1 The San Francisco Company and Subsidiaries Consolidated Statements of Operations Three Months Ended March 31, 2000 and 1999 (Unaudited) March 31, (Dollars in Thousands Except Per Share Data) 2000 1999 Interest income: Loans $2,337 $1,753 Investments 1,105 689 Dividends 29 26 Total interest income 3,471 2,468 Interest expense: Deposits 928 652 Other borrowings 266 272 Total interest expense 1,194 924 Net interest income 2,277 1,544 Provision for loan and lease losses 75 -- Net interest income after provision for loan and lease losses 2,202 1,544 Non-interest income: Stock option commissions and brokerage fees 1,056 437 Real estate rental income 309 306 Service charges and fees 269 174 Operating lease revenue 300 120 Other income 236 49 Total non-interest income 2,170 1,086 Non-interest expense: Salaries and related benefits 1,759 1,223 Occupancy expense 337 290 Depreciation of operating lease equipment 271 67 Data processing 127 109 Professional fees 142 85 Corporate insurance premiums 78 63 Equipment expense 52 51 Other operating expenses 231 182 Total non-interest expense 2,997 2,070 Income before income taxes 1,375 560 Provision for income taxes 76 3 Net Income $1,299 $557 Income per common share: Basic: Net income $0.04 $0.02 Weighted average shares outstanding 29,317,558 31,728,782 Diluted: Net income $0.04 $0.02 Weighted average shares outstanding 31,108,246 33,254,168 See accompanying notes to unaudited consolidated financial statements. page 2 The San Francisco Company and Subsidiaries Consolidated Statements of Changes in Shareholders' Equity and Comprehensive Income Three Months Ended March 31, 2000 and 1999 (Unaudited) Accumulated Other Total Additional Compre- Retained Compre- Share- (Dollars in Preferred Common Paid-in hensive Earnings hensive holders' Thousands) Stock Stock Capital Income (Deficit) Income Equity Balances at January 1, 1999 $111 $317 $78,816 $(56,619) $79 $22,704 Dividend on Preferred Stock -- -- -- (5) -- (5) Net income (three months) -- -- -- $557 557 -- 557 Other comprehensive loss, net of tax Unrealized losses on securities, net -- -- (133) -- (133) (133) Total other comprehensive loss -- -- -- (133) -- -- -- Comprehensive income $424 Balances at March 31, 1999 111 317 78,816 (56,067) (54) 23,123 Net proceeds from the exercise of stock options -- 4 128 -- -- 132 Dividend on Preferred Stock -- -- -- (7) -- (7) Redemption of Common Stock -- (28) (1,981) -- -- (2,009) Net income (nine months) -- -- -- $3,308 3,308 -- 3,308 Other comprehensive income, net of tax Unrealized gain on securities, net -- -- -- (593) -- (593) (593) Total other comprehensive income (593) Comprehensive income $2,715 Balances at December 31, 1999 111 293 76,963 (52,766) (647) 23,954 Net income (three months) -- -- -- $1,299 1,299 -- 1,299 Other comprehensive loss, net of tax Unrealized loss on securities, net -- -- -- (9) -- (9) (9) Total other comprehensive loss (9) Comprehensive income $1,290 Balances at March 31, 2000 $111 $293 $76,963 $(51,467) $(656) $25,244 See accompanying notes to unaudited consolidated financial statements. page 3 The San Francisco Company and Subsidiaries Consolidated Statements of Cash Flows Three Months Ended March 31, 2000 and 1999 (Unaudited) (Dollars in Thousands) 2000 1999 Cash Flows from Operating Activities: Net income $1,299 $557 Adjustments to reconcile net income to net cash provided by operating activities: Provision for loan losses 75 -- Depreciation and amortization expense 417 209 (Increase) decrease in interest receivable and other assets (137) 7 Increase (decrease) in interest payable and other liabilities 119 (422) Increase in deferred loan fees 62 14 Net cash flows provided by operating activities 1,835 298 Cash Flows from Investing Activities: Proceeds from maturities of investment securities held-to-maturity 1,213 548 Proceeds from maturities of investment securities available-for-sale 821 10,013 Purchase of investment securities available-for-sale (229) (4,093) Net increase in loans (5,755) (7,477) Purchases of premises and equipment (72) (27) Increase in investment in operating leases -- (2,943) Net cash used in investing activities (4,022) (3,979) Cash Flows from Financing Activities: Net decrease in other borrowings (2,000) -- Net increase (decrease) in deposits 31,947 (2,450) Dividends on Series B Preferred Stock -- (5) Net cash provided by (used in) financing activities 29,947 (2,455) Increase (decrease) in cash and cash equivalents 27,760 (6,136) Cash and cash equivalents at beginning of period 39,489 14,908 Cash and cash equivalents at end of period $67,249 $8,772 Supplemental Disclosure of Cash Flow Information: Cash paid during the period for: Interest $1,022 $747 Income taxes 36 6 See accompanying notes to unaudited consolidated financial statements. page 4 The San Francisco Company and Subsidiaries Notes to Consolidated Financial Statements (March 31, 2000 Unaudited) Note 1 - Organization The San Francisco Company (the "Company") is a Delaware corporation and a bank holding company registered under the Bank Holding Company Act of 1956. Bank of San Francisco (the "Bank") is a California state chartered banking corporation and a wholly owned subsidiary of the Company. Note 2 - Principles of Consolidation and Presentation The accompanying unaudited consolidated financial statements of the Company have been prepared in accordance with the instructions pursuant to Form 10-Q Quarterly Report and Articles 9 and 10 of Regulation S-X, and therefore do not include all the information and footnotes necessary to present the consolidated financial condition, results of operations and cash flows of the Company in conformity with generally accepted accounting principles. The data as of March 31, 2000, and for the three months ended March 31, 2000 and 1999 are unaudited, but in the opinion of management, reflect all accruals and adjustments of a normally recurring nature necessary for fair presentation of the Company's financial condition and results of operations. The results of operations for the three months ended March 31, 2000 are not necessarily indicative of the results to be expected for the entire year of 2000. This report should be read in conjunction with the Company's 1999 Annual Report on Form 10-K. The accompanying financial statements include the accounts of the Company, the Bank, and the Bank's wholly owned subsidiary, Bank of San Francisco Realty Investors (the "BSFRI"). All material intercompany transactions have been eliminated in consolidation. Certain reclassifications have been made in the prior years' consolidated financial statements to conform to the present year presentation. Note 3 - Earnings Per Share (the "EPS") Basic EPS is calculated by dividing net income by the weighted average number of Class A Common Shares (the "Common Stock"). The dilutive EPS is calculated giving effect to all potentially dilutive Common Shares, such as certain page 6 stock options, that were outstanding during the period. The following tables present a reconciliation of the amounts used in calculating basic and diluted EPS for each of the periods shown. (dollars in thousands except per-share amounts) Per-share March 31, 2000 Income Shares amount Basic EPS $1,297 29,317,558 $0.04 Effect of dilutive securities: Series B Preferred Stock - convertible 2 793 Stock Options -- 1,789,895 Diluted EPS $1,299 31,108,246 $0.04 Per-share March 31, 1999 Income Shares amount Basic EPS $555 31,728,782 $0.02 Effect of dilutive securities: Series B Preferred Stock - convertible 2 793 Stock Options -- 1,524,593 Diluted EPS $557 33,254,168 $0.02 Note 4 - Recent Accounting Pronouncements During the first quarter of 2000, there were no new pronouncements that are applicable to the Company or the Bank. Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations This document contains forward-looking statements that are subject to risks and uncertainties, including, but not limited to, the Company's and Bank's ability to implement their respective long-term business plans, the economy in general and the condition of stock markets upon which the Company's stock brokerage business and fee income is dependent, the continued services of the Company's and Bank's key executives and managers, any future change-of-control, the real estate market in California and other factors beyond the Company's and Bank's control. Such risks, uncertainties and factors, including those discussed herein, could cause actual results to differ materially from those indicated. Readers should not place undue reliance on forward-looking statements, which reflect management's views only as of the date hereof. The Company and the Bank undertake no obligation to revise these forward-looking statements to reflect subsequent events or circumstances. Readers are also encouraged to review the Company's publicly available filings with the Securities and Exchange Commission. Overview The Company is a one-bank holding company registered in Delaware under the Bank Holding Company Act of 1956. The principal activity of the Company is to serve as the holding company for Bank of San Francisco, a California chartered bank, with deposits insured by the Federal Deposit Insurance Corporation's Bank Insurance Fund. The information set forth in this report, including unaudited interim financial statements and related data, relates primarily to the Bank. The Company's Common Stock is not listed on any exchange. First Security Van Kasper of San Francisco California is the sole market maker in the Company's Common Stock. page 6 The Company recorded net income of $1,299,000 for the three months ended March 31, 2000, compared to net income of $557,000 for the same period in 1999. The increase in the Company's net income of $742,000 was primarily from an increase in net interest income and non-interest income, partially offset by an increase in non-interest expenses in first quarter 2000 compared to the same period in 1999. At March 31, 2000, total assets were $216.3 million, an increase of $31.4 million, or 17% from $184.9 million at December 31, 1999. As of March 31, 2000, total loans were $100.4 million, an increase of $5.8 million, or 6%, compared to $94.6 million at December 31, 1999. Total deposits were $170.9 million at March 31, 2000, an increase of $32.0 million, or 23%, compared to $138.9 million at December 31, 1999. Results of Operations Net Interest Income The Company's net interest income was $2.3 million in the quarter ended March 31, 2000 compared to $1.5 million for the same period in 1999, or an increase of 47%. Average earning assets increased by $49.2 million, or 37%, to $181.6 million for the first quarter of 2000 compared to $132.4 million for the same period in 1999. The yield on earning assets increased 30 basis points to 5.03% for the first quarter 2000 compared to 4.73% for the same period in 1999 primarily as a result of a lower average cost of deposits and higher yield on the investment portfolio. Provision for Loan and Lease Losses The Company recorded a provision for loan and lease losses of $75,000 for the first quarter of 2000 compared to none in the same period in 1999. The provision for loan and lease losses in 2000 reflects the amount necessary to increase the allowance for loan and lease losses to a level that management believed was adequate based on the factors that are more fully discussed under "Loans and Leases - Allowance for Loan and Lease Losses". Non-Interest Income Non-interest income was $2.2 million at March 31, 2000 compared to $1.1 million at March 31, 1999. The increase in non-interest income of $1.1 million, or 100%, was primarily the result of an increase in stock option and brokerage commission income, operating lease revenue, other income, and service charges and fees. The increase in stock option and brokerage revenue totaled $871,000, or 154%, for the first quarter in 2000 compared to the same period in 1999. The increase was the result of a higher volume of trading activity which the overall equity markets experienced. This level of trading volume is not expected to continue. Operating lease revenue increased $180,000, or 150%, in 2000 compared to 1999 as a result in an increase in total equipment owned and leased under operating leases. In addition, all other types of non-interest income improved primarily as a result of on-going marketing efforts. Non-Interest Expense The Company's non-interest expenses increased to $3.0 million from $2.1 million for the three month period ended March 31, 2000 and 1999, respectively. The increase of $927,000, or 45%, was primarily related to compensation related expenses including incentive programs, higher operating lease depreciation expense, higher occupancy expenses, higher data process and other expenses. The increase in salaries and related benefits of $536,000, or 44%, is primarily related to higher incentive accruals by $358,000, or 130%, based on performance; higher salaries by $105,000, or 14%, from an increase in personnel and salary adjustments; and higher temporary personnel by $73,000, or 304%, as a result of an increase in the number of page 7 temporary personnel necessary to process the higher volume of stock option and brokerage transactions. Financial Condition Liquidity and Capital Resources Liquidity The Bank's liquid assets, which include cash and short term investments totaled $67.2 million, or 31% of total assets, at March 31, 2000, an increase of $27.7 million, from $39.5 million, or 21% of total assets, at December 31, 1999. The increase in liquidity was the result of an increase in deposits by $32.0 million, cash flow provided by operating activities totaling $1.8 million, and net proceeds from investment securities totaling $1.8 million, partially offset by a decrease in borrowings of $2.0 million and an increase in net loans of $5.8 million. As of March 31, 2000, the Bank had pledged securities totaling $21.5 million to the Federal Home Loan Bank of San Francisco (the "FHLB") as collateral for other borrowings totaling $18.0 million. As of March 31, 2000, the Bank has the ability to borrow an additional $4.5 million to a maximum of $22.5 million from the FHLB upon the pledge of sufficient collateral. In the future, long and short-term borrowings from the FHLB may be used as an on-going source of liquidity and funding. As of March 31, 2000, the Bank had other securities totaling $600,000 pledged as collateral for public funds and trusts. The Bank has access to the discount window at the Federal Reserve Bank (the "FRB") for a total borrowing facility of $1.8 million upon the pledge of securities. At March 31, 2000 and December 31, 1999, no such borrowings were outstanding and no securities were pledged as collateral for the FRB facility. Capital At March 31, 2000, shareholders' equity was $25.2 million compared to $24.0 million at December 31, 1999. The Company and the Bank are subject to general capital regulations issued by the FRB, Federal Deposit Insurance Corporation, and California Department of Financial Institutions which require maintenance of a certain level of capital. As of March 31, 2000, the Company and the Bank are in compliance with all minimum capital ratio requirements. The following table reflects both the Company's and the Bank's capital ratios with respect to minimum capital requirements in effect as of March 31, 2000: Minimum Capital Company Bank Requirement Leverage ratio 12.2% 12.1% 4.0% Tier 1 risk-based capital 16.3 16.2 4.0 Total risk-based capital1 7.4 17.3 8.0 Investment Activities At March 31, 2000, the Company's investment securities totaled $34.5 million, or 16.0% of total assets, compared to $36.3 million, or 19.6% of total assets, at December 31, 1999. The change in investment securities resulted primarily from principal amortization on mortgage related securities. The Company's investment portfolio may from time to time include treasury and agency securities, fixed and adjustable rate mortgage backed securities, and to a limited page 8 extent collateralized mortgage backed securities. Generally, the Bank's investment securities held-to-maturity and available-for-sale have maturities or principal amortization of seven years or less. At March 31, 2000, investment securities held-to-maturity totaled $740,000, compared to $1,953,000 at December 31, 1999, and are carried at amortized cost. At March 31, 2000, the Company held $31.6 million in securities available-for-sale, compared to $32.2 million at December 31, 1999. Investment securities available-for-sale are accounted for at fair value. Unrealized gains and losses are recorded as an adjustment to equity and are not reflected in the current earnings of the Company. As of March 31, 2000, the investment securities available-for-sale have an unrealized loss of $1.1 million, that was included as a component of accumulated other comprehensive income under shareholder's equity to reflect the current market value of the securities available-for-sale. The decline in the market value of the investment securities was the result of increasing market interest rates during 1999 and the first three months of 2000. The market value of the investment portfolio will fluctuate with changes in market rates. Management believes the decline in market value is temporary and does not represent a permanent impairment in the market value of the investment portfolio. Loans and Leases During the first quarter of 2000, total loans and leases increased, from $94.6 million at December 31, 1999 to $100.4 million at March 31, 2000. The increase resulted primarily from the funding of new loans. The composition of the Bank's loan and lease portfolio at March 31, 2000 and December 31, 1999 is summarized as follows: March 31, December 31, (Dollars in Thousands) 2000 1999 Real estate mortgage $72,674 $67,914 Secured commercial and financial 9,837 9,386 Unsecured 13,892 13,344 Other loans and leases 3,964 3,968 Subtotal 100,367 94,612 Deferred fees and costs, net (202) (140) Allowance for loan and lease losses (1,600) (1,525) Total loans and leases, net $98,565 $92,947 Impaired Loans and Leases On March 31, 2000, the Bank had loans outstanding totaling $125,000 that were past due more than 31 days. The Company identifies loans with weak credit quality characteristics for review in accordance with SFAS No. 114 "Accounting by Creditors for Impairment of a Loan" as amended by SFAS No. 118 "Accounting by Creditors for Impairment of a Loan-Income Recognition and Disclosures" (the "SFAS No. 114"). As of March 31, 2000 and December 31, 1999, the Company had no impaired loans. No interest income was recognized on impaired loans during the first quarter of 2000 and 1999, respectively. There can be no assurance that the Bank will not experience losses in attempting to collect or otherwise liquidate the performing assets which are presently reflected on the Company's statement of financial condition. Allowance for Loan and Lease Losses Generally, the Bank charges current earnings with a provision for estimated losses on loan and lease receivables. The Bank will provide an adjustment if the total allowance for loan and lease losses exceeds the amount of estimated loan page 9 and lease losses. The provisions or adjustments take into consideration specifically identified problem loans, the financial condition of the borrowers, the fair value of the collateral, recourse to guarantors and other factors. Specific loss allowances are established based on asset characteristics and credit quality. Specific loss allowances are utilized to ensure that the allowance is allocated based on the credit quality including the present value of expected cash flows, the terms and structure of the loan, the financial condition of the borrower, and the fair value of underlying collateral. As of March 31, 2000, none of the allowance for loan losses was allocable to impaired loans, as identified in accordance with SFAS No. 114. In addition, the Bank carries an "unallocated" loan and lease loss allowance to provide for losses that may occur on loans and leases that may not presently have credit quality weaknesses, based on present economic conditions, trends, and related uncertainties. The following table summarizes the loan and lease loss experience of the Bank for the quarter ended March 31, 2000: March 31, (Dollars in Thousands) 2000 Beginning balance of allowance for loan and lease losses at December 31, 1999 $1,525 Charge-offs -- Recoveries -- Provision 75 Ending balance of allowance for loan and lease losses $1,600 Operating Lease Equipment As of March 31, 2000, other assets included investments in operating leases totaling $4.0 million compared to $4.3 million at December 31, 1999. Generally, the operating leases are comprised of computer and electronic test equipment leased under short-term rental agreements. Deposits The Company had total deposits of $170.9 million at March 31, 2000 compared to $138.9 million at December 31, 1999, an increase of $31.9 million or 23%. The increase was attributed to increases in Escrow related deposits of approximately $2.2 million, private and business banking related deposits of $16.0 million, homeowners' association related customer's deposits of $1.6 million, and an increase in stock option service related deposits of $13.5 million, partially offset by a reduction in money desk related deposits totaling $1.4 million. A summary of deposits at March 31, 2000 and December 31, 1999 is as follows: March 31, December 31, (Dollars in Thousands) 2000 1999 Demand deposits $48,810 $32,676 NOW 26,323 38,354 Money market and savings 57,694 27,555 Total deposits with no stated maturity 132,827 98,585 Time deposits: Less than $100,000 13,863 14,819 $100,000 and greater 24,168 25,507 Total time deposits 38,031 40,326 Total deposits $170,858 $138,911 page 10 The Bank's deposits from private and business banking customers totaled $77.0 million, or 46% of total deposits, at March 31, 2000, compared to $60.7 million, or 44% of total deposits, at December 31, 1999. Deposits from Association Bank Services customers totaled $29.5 million, or 17% of total deposits at March 31, 2000, compared to $28.2 million, or 20% of total deposits at December 31, 1999. Deposits from Escrow customers totaled $28.0 million, or 16% of total deposits at March 31, 2000, compared to $25.7 million, or 19% of total deposits at December 31, 1999. Deposits from Stock Option Services activities totaled $28.1 million, or 16% of total deposits at March 31, 2000, compared to $14.6 million, or 10% of total deposits at December 31, 1999. Deposits acquired through the money desk operations totaled $8.3 million, or 5% of total deposits at March 31, 2000, compared to $9.7 million, or 7% of total deposits at December 31, 1999. Other Borrowings As of March 31, 2000, the Bank had long-term FHLB borrowings outstanding totaling $15.0 million and short-term FHLB borrowings outstanding of $3.0 million secured by pledged securities totaling $21.5 million. Item 3. Quantitative and Qualitative Disclosures About Market Risk Market Risk Management Market risk includes risks that arise from changes in interest rates, foreign currency, exchange rates, commodity prices, equity prices and other market changes that affect market sensitive instruments. The Company's primary market rate risk, interest rate risk, has not changed significantly since December 31, 1999. The Company does not have any significant risk related to foreign currency, exchange rates, commodity prices, equity prices, and other changes that affect market sensitive instruments. page 11 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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. The San Francisco Company (Registrant) Date: May 3, 2000 /s/ James E. Gilleran James E. Gilleran Chairman of the Board and Chief Executive Officer Date: May 3, 2000 /s/ Keary L. Colwell Keary L. Colwell Chief Financial Officer and Executive Vice President EX-27 2
9 3-MOS DEC-31-2000 MAR-31-2000 6,576 0 60,673 0 31,606 740 726 100,367 1,600 216,282 170,858 3,000 2,180 15,000 0 111 293 0 216,282 2,337 1,105 29 3,471 928 1,194 2,277 75 0 2,997 1,375 1,375 0 0 1,299 0.04 0.04 5.0 0 0 0 0 1,525 0 0 1,600 1,600 0 0
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