-----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, MgAhRqhR7Q7WJ4QmPiNjm4A6JDj1JiqTInIgmyFnnyJESRqrlgKLWMfPA4zTetly CDYSmnncHLyQkuXmY6ynEA== 0000931763-95-000197.txt : 19951119 0000931763-95-000197.hdr.sgml : 19951119 ACCESSION NUMBER: 0000931763-95-000197 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951113 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: ABC BANCORP CENTRAL INDEX KEY: 0000351569 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 581456434 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-16181 FILM NUMBER: 95590002 BUSINESS ADDRESS: STREET 1: 310 FIRST ST NE CITY: MOULTRIE STATE: GA ZIP: 31768 BUSINESS PHONE: 9128901111 MAIL ADDRESS: STREET 1: PO BOX 1500 CITY: MOULTRIE STATE: GA ZIP: 31776 FORMER COMPANY: FORMER CONFORMED NAME: ABC HOLDING CO DATE OF NAME CHANGE: 19870119 10QSB 1 FORM 10-QSB 3RD QUARTER UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-QSB (Mark One) [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1995 ------------------ OR [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 0-16181 ------- ABC BANCORP ------------------------------------------------------ (Exact name of registrant as specified in its charter) GEORGIA 58-1456434 ------------------------------- --------------------- (State of incorporation) (IRS Employer ID No.) 310 FIRST STREET, SE MOULTRIE, GA 31768 ----------------------------------------- (Address of principal executive offices) (912)890-1111 ------------------------------- (Registrant's telephone number) 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 --- --- There were 3,352,525 shares of Common Stock outstanding as of September 30, 1995. 1 ABC BANCORP QUARTERLY REPORT ON FORM 10-QSB FOR THE QUARTER ENDED SEPTEMBER 30, 1995 TABLE OF CONTENTS PART I - FINANCIAL INFORMATION Item Page - ----- ---- 1. Financial Statements Consolidated Statements of Financial Condition 3 Consolidated Statements of Income 4 - 5 Consolidated Statements of Cash Flows 6 - 7 Notes to Consolidated Financial Statements 8 2. Management's Discussion and Analysis of Financial 9 - 13 Condition and Results of Operations PART II - OTHER INFORMATION 3. Submission of Matters to a Vote of Securities Holders 14 6. Exhibits and Reports on Form 8-K 14 Signatures 15 2 ABC BANCORP AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 1995 (DOLLARS IN THOUSANDS) (UNAUDITED) - ------------------------------------------------------------------------------ 1995 -------- Cash and due from banks $ 18,540 Securities available for sale, at fair value 11,545 Securities held for investment, at cost (fair value $35,917) 35,858 Federal funds sold 19,630 Loans 215,073 Less allowance for loan losses 4,216 -------- Loans, net 210,857 -------- Premises and equipment, net 7,011 Other assets 10,527 -------- $313,968 ======== LIABILITIES AND STOCKHOLDERS' EQUITY - ------------------------------------ Deposits Noninterest -bearing demand $41,736 Interest-bearing demand 60,690 Savings 22,866 Time, $100,000 and over 36,513 Other time 109,333 -------- Total deposits 271,138 Federal funds purchased, securities sold under repurchase agreements and other borrowings 2,159 Other liabilities 7,764 -------- Total liabilities 281,061 -------- COMMITMENTS AND CONTINGENT LIABILITIES STOCKHOLDERS' EQUITY Common stock,par value $1; 10,000,000 shares authorized, 3,597,074 issued 3,597 Capital surplus 16,826 Retained earnings 14,099 Unrealized gains (losses) on securities available for sale, net of taxes 65 -------- 34,587 Less cost of 244,549 shares acquired for the treasury (1,680) -------- Total stockholders' equity 32,907 -------- $313,968 ======== SEE NOTE TO CONSOLIDATED FINANCIAL STATEMENTS. 3 ABC BANCORP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME THREE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994 (DOLLARS IN THOUSANDS) (UNAUDITED) - ------------------------------------------------------------------------------
THREE MONTHS ENDED 1995 1994 ------ ------ INTEREST INCOME Income and fees on loans $5,861 $4,681 Interest on taxable securities 576 450 Interest on nontaxable securities 126 146 Interest on deposits in other banks 30 51 Interest on Federal funds sold 246 141 ------ ------ 6,839 5,469 ------ ------ INTEREST EXPENSE Interest on deposits 2,745 1,960 Interest on federal funds purchased, securities sold under repurchase agreement and other borrowings 121 31 ------ ------ 2,866 1,991 ------ ------ Net interest income 3,973 3,478 PROVISION FOR LOAN LOSSES 206 191 ------ ------ Net interest income after provision for loan losses 3,767 3,287 ------ ------ OTHER INCOME Service charges on deposit accounts 693 626 Other service charges, commisions and fees 104 86 Other 70 51 ------ ------ 867 763 ------ ------ OTHER EXPENSE Salaries and employee benefits 1,593 1,409 Equipment expense 165 263 Occupancy expense 406 230 Amortization of intangible assets 79 68 Data processing fees 92 94 Directors fees 80 73 FDIC premiums (15) 138 Other operating expenses 568 395 ------ ------ 2,968 2,670 ------ ------ Income before income taxes 1,666 1,380 Applicable income taxes 539 412 ------ ------ NET INCOME $1,127 $968 ====== ====== Income per common share $0.34 $0.29 ===== ===== Average shares outstanding 3,352,525 3,352,525
SEE NOTE TO CONSOLIDATED FINANCIAL STATEMENTS. 4 ABC BANCORP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994 (DOLLARS IN THOUSANDS) (UNAUDITED) - ------------------------------------------------------------------------------
NINE MONTHS ENDED 1995 1994 ------- ------- INTEREST INCOME Income and fees on loans $16,653 $12,931 Interest on taxable securities 1,648 1,379 Interest on nontaxable securities 395 469 Interest on deposits in other banks 81 113 Interest on Federal funds sold 821 515 ------- ------- 19,598 15,407 ------- ------- INTEREST EXPENSE Interest on deposits 7,584 5,572 Interest on federal funds purchased, securities sold under repurchase agreements and other borrowings 256 192 ------- ------- 7,840 5,764 ------- ------- Net interest income 11,758 9,643 PROVISION FOR LOAN LOSSES 566 603 ------- ------- Net interest income after provision for loan losses 11,192 9,040 ------- ------- OTHER INCOME Service charges on deposit accounts 1,921 1,798 Other service charges, commissions and fees 457 382 Other 169 173 ------- ------- 2,547 2,353 ------- ------- OTHER EXPENSE Salaries and employee benefits 4,698 4,295 Equipment expense 715 742 Occupancy expense 868 665 Amortization of intangible assets 238 242 Data processing fees 277 331 Directors fees 235 218 FDIC premiums 276 420 Other operating expenses 1,730 1,419 ------- ------- 9,037 8,332 ------- ------- Income before income taxes 4,702 3,061 Applicable income taxes 1,518 909 ------- ------- NET INCOME $ 3,184 $ 2,152 ======= ======= Income per common share $0.95 $0.76 ====== ====== Average shares outstanding 3,352,525 2,823,160
SEE NOTE TO CONSOLIDATED FINANCIAL STATEMENTS. 5 ABC BANCORP AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994 (DOLLARS IN THOUSANDS) (UNAUDITED) - ------------------------------------------------------------------------------
1995 1994 -------- -------- CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 3,184 $ 2,153 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 637 487 Provision for loan losses 566 603 Amortization of intangible assets 201 259 Other prepaids, deferrals and accruals, net (2,091) (286) -------- -------- Total adjustments (687) 1,063 -------- -------- Net cash provided by (used in) operating activities 2,497 3,216 -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from maturities of securities held for investment 10,784 5,797 Purchase of securities available for sale (10,943) -- Purchase of securities held for investment (620) (4,753) (Increase) decrease in interest-bearing deposits in bank -- 257 (Increase)decrease in Federal funds sold 2,222 19,100 (Increase) decrease in loans (23,336) (28,133) Purchase of premises and equipment (478) (1,972) -------- -------- Net cash provided by (used in) investing activities (22,371) (9,704) -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES Net increase (decrease) in deposits 14,584 2,087 Net increase (decrease) in repurchase agreements (597) (935) Sale of common stock, net of expense -- 8,514 Increase (decrease) of long-term debt 4,774 (4,662) Cash purchase of fractional shares (3) -- Dividends paid (838) (646) -------- -------- Net cash provided by (used in) financing activities 17,920 4,358 -------- --------
6 ABC BANCORP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30 1995 AND 1994 (DOLLARS IN THOUSANDS) (UNAUDITED) - ------------------------------------------------------------------------------ 1995 1994 ------- ------- Net increase (decrease) in cash and due from banks $(1,954) $(2,130) Cash and due from banks at beginning of year 20,494 16,994 ------- ------- Cash and due from banks at end of quarter $18,540 $14,864 ======= ======= SEE NOTE TO CONSOLIDATED FINANCIAL STATEMENTS. 7 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - -------------------------------------------------------------------------------- NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting and reporting policies of ABC Bancorp and subsidiaries ("the Company") conform to generally accepted accounting principles and to general practices within the banking industry. The interim consolidated financial statements included herein are unaudited, but reflect all adjustments which, in the opinion of management, are necessary for a fair presentation of the consolidated financial position and results of operations for the interim periods presented. All adjustments reflected in the interim financial statements are of a normal recurring nature. Such financial statements should be read in conjunction with the financial statements and notes thereto and the report of independent auditors included in the Company's Form 10-KSB Annual Report for the year ended December 31, 1994. The results of operations for the nine months ended September 30, 1995 are not necessarily indicative of the results to be expected for the full year. NOTE 2. STOCKHOLDERS' EQUITY As of July 17, 1995, a 4-for-3 stock split in the form of a Common Stock dividend on the outstanding shares of the Company's Common Stock became effective. Fractional shares were paid in cash. All per share information reflects retroactively this stock split. 8 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS LIQUIDITY AND CAPITAL RESOURCES - ------------------------------- Liquidity management involves the matching of the cash flow requirements of customers who may be either depositors desiring to withdraw funds or borrowers needing assurance that sufficient funds will be available to meet their credit needs and the ability of the ABC Bancorp and subsidiaries (the "Company") to meet those needs. The Company seeks to meet liquidity requirements primarily through management of short-term investments (principally Federal funds sold) and monthly amortizing loans. Another source of liquidity is the repayment of maturing single payment loans. Also, the subsidiary banks (the "Banks") maintain relationships with correspondent banks which could provide funds to them on short notice, if needed. The liquidity and capital resources of the Company is monitored on a periodic basis by state and Federal regulatory authorities. As determined under guidelines established by these regulatory authorities, the Banks' liquidity ratios at September 30, 1995 were considered satisfactory. At that date, the Banks' short-term investments were adequate to cover any reasonably anticipated immediate need for funds. The Company is aware of no events or trends likely to result in a material change in liquidity. At September 30, 1995, the Company's and the Banks' capital asset ratios were considered adequate based on guidelines established by regulatory authorities. After recording an increase in capital of $20,032 for unrealized gains on securities, net of taxes, total capital increased during the third quarter of 1995 by $766,893. At September 30, 1995, total capital of the Company amounted to $32,906,421. At September 30, 1995, there were no outstanding commitments for any major capital expenditures. RESULTS OF OPERATIONS The Company's results of operations are determined by its ability to effectively manage interest income and expense, to minimize loan and investment losses, to generate noninterest income and to control noninterest expense. Since interest rates are determined by market forces and economic conditions beyond the control of the Company, the ability to generate net interest income is dependent upon the Banks' ability to obtain an adequate spread between the rate earned on interest-earning assets and the rate paid on interest-bearing liabilities. Thus, the key performance measure for net interest income is the interest margin or net yield, which is taxable-equivalent net interest income divided by average earning assets. 9 RESULTS OF OPERATION (CONTINUED) The primary component of consolidated earnings is net interest income, or the difference between interest income on interest-earning assets and interest paid on interest-bearing liabilities. The net interest margin is net interest income expressed as a percentage of average interest-earning assets. Interest-earning assets consist of loans, investment securities and Federal funds sold. Interest-bearing liabilities consist of deposits,(of which approximately 16% are noninterest-bearing) and borrowings such as Federal funds purchased, securities sold under repurchase agreements and Federal Home Loan Bank advances. A portion of interest income is earned on tax-exempt investments, such as state and municipal bonds. In an effort to state this tax- exempt income and its resultant yields on a basis comparable to all other taxable investments, an adjustment is made to analyze this income on a taxable- equivalent basis. The net interest margin was 5.92% and 5.48% during the nine months ended September 30, 1995 and 1994, respectively, an increase of 8.3%. This increase in net interest margin was achieved by an increase of 10 basis points on average yield earned on interest-earning assets accompanied by a decrease of 6 basis points in average rate paid on interest-bearing liabilities. Net interest income on a taxable-equivalent basis was $11,962,000 as compared to $9,885,000 during the nine months ended September 30, 1995 and 1994, respectively, representing an increase of 21.0%. Net interest income on a taxable-equivalent basis was $4,038,000 as compared to $3,553,000 during the three months ended September 30, 1995 and 1994, respectively, representing an increase of 13.7%. Average interest-earning assets increased by $23,668,000 to $264,620,000 during the nine months ended September 30, 1995 from $240,952,000 during the nine months ended September 30, 1994. Average loans increased by $24,410,000; average investments increased by $2,713,941; and average Federal funds sold decreased by $536,900. The increase in average interest-earning assets was funded by an increase in average deposits of $20,724,000 or 8.6% to $260,618,000 during the nine months ended September 30, 1995 from $239,894,000 during the nine months ended September 30, 1994. Approximately 16% of the average deposits were noninterest-bearing during the nine months ended September 30, 1995 as compared to 16% during the nine months ended September 30, 1994. 10 RESULTS OF OPERATION (CONTINUED) The allowance for loan losses represents a reserve for potential losses in the loan portfolio. The adequacy of the allowance for loan losses is evaluated periodically based on a review of all significant loans, with a particular emphasis on nonaccruing, past due and other loans that management believes require attention. The provision for loan losses is a charge to earnings in the current period to replenish the allowance and maintain it at a level management has determined to be adequate. The provision for loan losses charged to earnings amounted to $206,000 and $566,000 during the three and nine months ended September 30, 1995 and $191,000 and $603,000 during the three and nine months ended September 30, 1994. Charge-offs, net of recoveries, amounted to $57,000 and $44,000 during the nine months ended September 30, 1995 and 1994, respectively. The allowance for loan losses was 2.0% and 2.3% of total loans outstanding at September 30, 1995 and 1994, respectively. The determination of the allowance rests upon management's judgment about factors affecting loan quality and assumptions about the local and national economy. Management considers the quarter-end allowance for loan losses adequate to cover potential losses in the loan portfolio. Following is a comparison of noninterest income for the three and nine months ended September 30, 1995 and 1994. (dollars in thousands)
THREE MONTHS ENDED ---------------------- % INC Sept 1995 Sept 1994 (DEC) --------- --------- ------ Service charges on deposits $693 $626 10.70% Other service charges & fees 104 86 20.93% Other income 70 51 37.25% ---- ---- ------ $867 $763 13.63% ==== ==== ====== NINE MONTHS ENDED ---------------------- % INC Sept 1995 Sept 1994 (DEC) --------- --------- ----- Service charges on deposits $1,921 $1,798 6.84% Other service charges & fees 457 382 19.63% Other income 169 173 (2.31%) ------ ------ ------ $2,547 $2,353 8.24% ====== ====== ======
11 RESULTS OF OPERATIONS (CONTINUED) The increase in service charges on deposits for the nine months ended September 30, 1995 is attributable to an increase in average deposits of $20,724,000 as compared to the nine months ended September 30, 1994. The increase in other service charges and fees is attributable to an increase in the volume of loans. Following is an analysis of noninterest expense for the three and nine months ended September 30, 1995 and 1994. (dollars in thousands)
THREE MONTHS ENDED ---------------------- % INC Sept 1995 Sept 1994 (DEC) ----------- ----------- --------- Salaries and employee benefits $1,593 $1,409 13.06% Occupancy and equipment expense 571 493 15.82% Deposit insurance premium (15) 138 (110.13%) Data processing fees 92 94 (2.13%) Other expense 728 536 35.82% ------ ------ ------- $2,968 $2,670 11.16% ====== ====== ======= NINE MONTHS ENDED ---------------------- % INC Sept 1995 Sept 1994 (DEC) ----------- ----------- -------- Salaries and employee benefits $4,698 $4,295 9.38% Occupancy and equipment expense 1,583 1,407 12.51% Deposit insurance premium 276 420 (34.29%) Data processing fees 277 331 (16.31%) Other expense 2,203 1,879 (17.24%) ------ ------ ------- $9,037 $8,332 8.46% ====== ====== =======
Salaries and employee benefits for the nine months ended September 30, 1995 was $403,000 higher than during the same period in 1994. Salaries increased $210,715; bonuses increased $78,431; and employee benefits increased $114,030. 12 RESULTS OF OPERATION (CONTINUED) Following is a condensed summary of net income during the three and nine months ended September 30, 1995 and 1994. (dollars in thousands) CAPTION> THREE MONTHS ENDED -------------------- INC Sept 1995 Sept 1994 (DEC) --------- --------- ------- Net interest income $3,973 $3,478 $495 Provision for loan losses 206 191 15 Other income 867 763 104 Other expense 2,968 2,670 298 ------ ------ ---- Income before income taxes 1,666 1,380 286 Applicable income taxes 539 412 127 ------ ------ ---- Net Income $1,127 $ 968 $159 ====== ====== ==== NINE MONTHS ENDED -------------------- INC Sept 1995 Sept 1994 (DEC) --------- --------- ------- Net interest income $11,758 $9,643 $2,115 Provision for loan losses 566 603 (37) Other income 2,547 2,353 194 Other expense 9,037 8,332 705 ------- ------ ------ Income before income taxes 4,702 3,061 1,641 Applicable income taxes 1,518 909 609 ------- ------ ------ Net Income $ 3,184 $2,152 $1,032 ======= ====== ======
13 PART II. OTHER INFORMATION ITEM 3. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS There were no matters submitted to a vote of securities holders during the quarter ended September 30, 1995. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K A. Exhibits - None. B. There have been no reports filed on Form 8-K for the quarter ended September 30, 1995. 14 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the Undersigned thereunto duly authorized: ABC BANCORP November 9, 1995 /s/ W. Edwin Lane, Jr. - ------------------ ---------------------------------------- DATE W. EDWIN LANE, JR. EXECUTIVE VICE PRESIDENT & CHIEF FINANCIAL OFFICER (Duly authorized officer and principal financial/accounting officer) 15 EX-27 2 FINANCIAL DATA SCHEDULE
9 1,000 3-MOS 3-MOS DEC-31-1995 DEC-31-1994 JUN-30-1995 JUN-30-1994 SEP-30-1995 SEP-30-1994 18,540 14,864 0 1,000 19,630 12,475 0 0 35,858 44,870 11,545 0 47,462 43,832 215,073 189,823 4,216 4,117 313,968 274,976 271,138 240,312 2,159 2,245 7,764 2,423 0 15 3,597 2,698 0 0 0 0 32,907 29,981 313,968 274,976 5,861 4,687 702 596 276 192 6,839 5,469 2,745 1,960 121 31 3,973 3,478 206 191 0 0 2,968 2,670 1,666 1,380 0 0 0 0 0 0 1,127 968 .34 .29 0 0 10.08 9.16 2,690 3,752 4,426 4,587 0 0 0 0 3,758 3,571 404 422 295 365 4,216 4,117 0 0 0 0 4,216 4,117
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