-----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, BOtbU6j1SLHEiL0fUuqyZBSZvWiBljL5OT8NlUkzLggGOOJgfHLpzsS9BtGEOJCc +NwX6+TeSwlljo0gIGKLYg== 0000931763-98-002870.txt : 19981113 0000931763-98-002870.hdr.sgml : 19981113 ACCESSION NUMBER: 0000931763-98-002870 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980930 FILED AS OF DATE: 19981112 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: 10-Q SEC ACT: SEC FILE NUMBER: 001-13901 FILM NUMBER: 98745202 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 10-Q 1 FORM 10-Q FOR THE QTR ENDED SEPT. 30, 1998 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (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, 1998 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 7,244,865 SHARES OF COMMON STOCK OUTSTANDING AS OF SEPTEMBER 30, 1998. 1 ABC BANCORP QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 1998 TABLE OF CONTENTS PART I - FINANCIAL INFORMATION Item Page - ----- ---- 1. Financial Statements Consolidated Balance Sheets 3 Consolidated Statements of Income & Comprehensive Income 4 Consolidated Statements of Cash Flows 6 Notes to Consolidated Financial Statements 7 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 8 PART II - OTHER INFORMATION 4. Submission of Matters to a Vote of Securities Holders 16 6. Exhibits and Reports on Form 8-K 16 SIGNATURE 17 2 ABC BANCORP AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in Thousands) (Unaudited) ================================================================================
September 30 December 31 1998 1997 ------------- ----------- Assets Cash and due from banks $ 49,533 $ 36,261 Federal funds sold 970 890 Securities available for sale, at fair value 98,829 93,199 Securities held to maturity, at cost 19,584 30,020 Loans 498,428 490,244 Less allowance for loan losses 10,883 7,627 -------- -------- Loans, net 487,545 482,617 -------- -------- Premises and equipment, net 19,624 19,054 Other assets 23,869 29,845 -------- -------- $699,954 $691,886 ======== ======== Liabilities and Stockholders' Equity Deposits Noninterest -bearing demand 82,001 $ 90,109 Interest-bearing demand 127,921 128,294 Savings 51,273 46,715 Time, $100,000 and over 85,515 85,937 Other time 262,544 249,656 -------- -------- Total deposits 609,254 600,711 Federal funds purchased & securities sold under repurchase agreements 443 660 Other borrowings 13,971 15,400 Other liabilities 6,845 6,962 -------- -------- Total liabilities 630,513 623,733 -------- -------- Stockholders' equity Common stock,par value $1; 15,000,000 shares authorized 7,524,718 shares issued 7,525 7,525 Surplus 29,677 29,677 Retained earnings 33,443 32,264 Accumulated other comprehensive income 445 242 -------- -------- 71,090 69,708 Less cost of shares acquired for the treasury, 279,853 and 272,353 shares (1,649) (1,555) -------- -------- Total stockholders' equity 69,441 68,153 -------- -------- $699,954 $691,886 ======== ========
See Notes to Consolidated Financial Statements. 3 ABC BANCORP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME THREE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997 (Dollars in Thousands) (Unaudited)
================================================================================================ 1998 1997 ---------- ---------- Interest income Interest and fees on loans $ 13,247 $ 12,747 Interest on taxable securities 1,412 1,648 Interest on nontaxable securities 300 302 Interest on deposits in other banks 301 83 Interest on Federal funds sold 8 36 ---------- ---------- 15,268 14,816 ---------- ---------- Interest expense Interest on deposits 6,484 6,268 Interest on securities sold under repurchase agreements and other borrowings 267 476 ---------- ---------- 6,751 6,744 ---------- ---------- Net interest income 8,517 8,072 Provision for loan losses 819 610 ---------- ---------- Net interest income after provision for loan losses 7,698 7,462 ---------- ---------- Other income Service charges on deposit accounts 1,397 1,382 Other service charges, commisions and fees 547 544 Other 24 8 ---------- ---------- 1,968 1,934 ---------- ---------- Other expense Salaries and employee benefits 3,996 3,800 Equipment expense 641 638 Occupancy expense 500 383 Amortization of intangible assets 257 239 Data processing fees 333 138 Directors fees 190 160 FDIC premiums 61 62 Other operating expenses 1,396 1,724 ---------- ---------- 7,374 7,144 ---------- ---------- Income before income taxes 2,292 2,252 Applicable income taxes 790 724 ---------- ---------- Net income $ 1,502 $ 1,528 ---------- ---------- Other comprehensive income, net of tax: Unrealized holding losses arising during period $ 228 $ 145 Comprehensive income $ 1,730 $ 1,673 ========== ========== Income per common share-Basic $ 0.21 $ 0.21 ========== ========== Income per common share-Diluted $ 0.21 $ 0.21 ========== ========== Average shares outstanding 7,252,365 7,252,365 ========== ==========
See Notes to Consolidated Financial Statements. 4 ABC BANCORP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997 (Dollars in Thousands) (Unaudited)
==================================================================================================================== 1998 1997 ----------- ------------ Interest income Interest and fees on loans $ 38,647 $ 37,159 Interest on taxable securities 4,677 5,158 Interest on nontaxable securities 903 899 Interest on deposits in other banks 604 144 Interest on Federal funds sold 39 173 ---------- ---------- 44,870 43,533 ---------- ---------- Interest expense Interest on deposits 19,120 17,973 Interest on securities sold under repurchase agreements and other borrowings 828 1,365 ---------- ---------- 19,948 19,338 ---------- ---------- Net interest income 24,922 24,195 Provision for loan losses 4,139 1,715 ---------- ---------- Net interest income after provision for loan losses 20,783 22,480 ---------- ---------- Other income Service charges on deposit accounts 4,165 3,969 Other service charges, commisions and fees 1,603 1,439 Other 311 234 ---------- ---------- 6,079 5,642 ---------- ---------- Other expense Salaries and employee benefits 11,745 10,845 Equipment expense 1,810 1,692 Occupancy expense 1,387 1,212 Amortization of intangible assets 682 579 Data processing fees 504 360 Directors fees 519 464 FDIC premiums 178 194 Other operating expenses 4,877 4,674 ---------- ---------- 21,702 20,020 ---------- ---------- Income before income taxes 5,160 8,102 Applicable income taxes 1,805 2,691 ---------- ---------- Net income $ 3,355 $ 5,411 ---------- ---------- Other comprehensive income, net of tax: Unrealized holding gains arising during period $ 203 $ 188 Comprehensive income $ 3,558 $ 5,599 ========== ========== Income per common share-Basic $ 0.46 $ 0.75 ========== ========== Income per common share-Diluted $ 0.46 $ 0.75 ========== ========== Average shares outstanding 7,252,365 7,252,365 ========== ==========
See Notes to Consolidated Financial Statements. 5 ABC BANCORP AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997 (Unaudited)
================================================================================================================== 1998 1997 -------- -------- CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 3,355 $ 5,411 -------- -------- Adjustments to reconcile net income to net cash provided by operating activities: Depreciation $ 1,513 $ 1,050 Provision for loan losses 4,139 1,715 Amortization of intangible assets 682 579 Other prepaids, deferrals and accruals, net 5,100 7,635 -------- -------- Total adjustments 11,434 10,979 -------- -------- Net cash provided by operating activities 14,789 16,390 -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from maturities of investment securities 55,041 15,855 Purchase of investment securities (49,955) (16,238) Proceeds from sales of securities available for sale 0 6,365 (Increase)decrease in Federal funds sold (80) 6,060 (Increase) decrease in loans (9,067) (27,603) Purchase of premises and equipment (2,084) (3,080) Net cash received from acquisition of deposits 0 16,398 -------- -------- Net cash used in investing activities (6,145) (2,243) -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES Net increase (decrease) in deposits 8,543 (21,748) Net increase (decrease) in repurchase agreements (217) 135 Increase (decrease) in other borrowings (1,429) (3,150) Dividends paid (2,175) (1,942) Proceeds from exercise of stock options 0 109 Purchase of fractional shares 0 (6) Purchase treasury stock (94) -------- -------- Net cash provided by (used in) financing activities 4,628 (26,602) -------- -------- Net increase (decrease) in cash and due from banks $ 13,272 $(12,455) Cash and due from banks at beginning of period 36,261 42,901 -------- -------- Cash and due from banks at end of period $ 49,533 $ 30,446 ======== ========
See Notes to Consolidated Financial Statements. 6 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-K Annual Report for the year ended December 31, 1997. The results of operations for the nine months ended September 30, 1998 are not necessarily indicative of the results to be expected for the full year. 7 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 ABC Bancorp and its subsidiaries (the "Company") to meet those needs. The Company strives to maintain an adequate liquidity position by managing the balances and maturities of interest-earning assets and interest- bearing liabilities so that the balance it has in short-term investments (Federal funds sold) at any given time will adequately cover any reasonably anticipated immediate need for funds. Additionally, 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, 1998 were considered satisfactory. At that date, the Banks' Federal funds sold 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, 1998, the Company's and the Banks' capital asset ratios were considered adequate based on guidelines established by regulatory authorities. During the nine months ended September 30, 1998, total capital increased $1,288,000 to $69,441,000. This increase in capital resulted from the retention of net earnings of $1,180,000 (after deducting dividends to shareholders of $2,175,000), an increase of $202,000 in unrealized gains on securities available for sale, net of taxes, less $94,000 for the purchase of 7,500 shares acquired for the treasury. As of September 30, 1998, the Company had binding commitments for capital expenditures totaling $300,000. The Company anticipates that approximately $1,000,000 will be required for capital expenditures during the remainder of 1998. Additional expenditures may be required for other mergers and acquisitions. No additional mergers or acquisitions requiring cash are being negotiated at present. 8 MERGERS AND ACQUISITIONS On July 17, 1997, the Company purchased the assets and assumed the liabilities of the Douglas, Georgia banking center of NationsBank. Total assets of $29.3 million were included in the transaction, with loans totaling $7.3 million. Total deposits of $29.3 million were assumed by ABC. The Douglas branch is now an extension of Citizens Security Bank (formerly The Citizens Bank of Tifton), the Company's wholly-owned subsidiary in Tifton, Georgia ("CSB"). The premium paid upon consummation of this transaction was $3.5 million, and was recorded as an intangible asset on the books of CSB. The Company injected $4.2 million additional capital into CSB in connection with this transaction. On August 31, 1997, CSB acquired 100% of the equity of Irwin Bankcorp, Inc., Ocilla, Georgia. The acquisition was accounted for as a pooling of interests. Irwin had total assets of approximately $38 million, loans of approximately $17 million, deposits of approximately $31 million and equity of approximately $6 million. Irwin's wholly-owned subsidiary, The Bank of Ocilla, also became a branch of CSB. YEAR 2000 STATUS The Company is actively engaged in remediating potential Year 2000 technology problems. All items were inventoried and vendors contacted regarding Year 2000 readiness of their products. The inventory included computer equipment and software as well as other items which could contain embedded date chips. Renovation plans for non-compliant items were developed. The Company is currently in the process of testing. It is anticipated that all testing and implementation of compliant technology items will be completed by June, 1999. The Company's and subsidiaries' Boards of Directors are updated on a regular basis on the status of the project. The Company estimates total Year 2000 project costs will approximate $500,000 of which $224,000 has been spent through September 30, 1998. Year 2000 expenditures are not expected to have a material impact on the company's earnings, financial position or cash flows. Additionally, the status of major customers and vendors is being reviewed to minimize the risks to the Company. 9 The impact of Year 2000 noncompliance by major customers and vendors cannot be accurately projected at this time. ABC Bancorp is in the process of developing contingency plans should there be system failures due to this problem. The Company anticipates adoption of contingency plans by December 31, 1998. 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. 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 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. 10 COMPARISON OF STATEMENTS OF INCOME The net interest margin was 5.33% and 5.30% during the nine months ended September 30, 1998 and 1997, respectively, an increase of 3 basis points. These variances are primarily attributable to fluctuations in the average rates charged and fees earned on loans. Net interest income on a taxable-equivalent basis was $25.5 million as compared to $24.7 million during the nine months ended September 30, 1998 and 1997, respectively, representing an increase of 3.2%. The provision for loan losses is a charge to earnings in the current period to replenish the allowance for loan losses and maintain it at the level management determines is adequate. The provision for loan losses charged to earnings amounted to $4,139,000 and $1,715,000 during the nine months ended September 30, 1998 and 1997, respectively. Adverse weather conditions during the previous several months in most of the Company's market areas had an adverse impact on some large loans in the Company's portfolio. Management is carefully monitoring the economic conditions, the collateral associated with selected loans and the ability of the customers to repay specific loans in accordance with the negotiated loan agreements. 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 quarterly based on a review of all significant loans, with a particular emphasis on non-accruing, past due and other loans that management believes require attention. Another factor used in determining the adequacy of the reserve is management's judgment about factors affecting loan quality and assumptions about the local and national economy. The allowance for loan losses was 2.18% and 1.56% of total loans outstanding at September 30, 1998 and December 31, 1997. Management considers the allowance for loan losses as of September 30, 1998 adequate to cover potential losses in the loan portfolio. 11 Following is a comparison of noninterest income for the three and nine months ended September 30, 1998 and 1997 (dollars in thousands). Three Months Ended ------------------ September 30, 1998 September 30, 1997 ------------------ ------------------ Service charges on deposits $1,397 $1,382 Other service charges, commissions & fees 547 544 Other income 24 8 ------ ------ TOTAL NONINTEREST INCOME $1,968 $1,934 ====== ====== Nine Months Ended ----------------- September 30, 1998 September 30, 1997 ------------------ ------------------ Service charges on deposits $4,165 $3,969 Other service charges, commissions & fees 1,603 1,439 Other income 311 234 ------ ------ TOTAL NONINTEREST INCOME $6,079 $5,642 ====== ====== Total noninterest income for the nine months ended September 30, 1998 was $437,000 higher than during the same period in 1997. Following is an analysis of noninterest expense for the three and nine months ended September 30, 1998 and 1997 (dollars in thousands). Three Months Ended ------------------ September 30,1998 September 30, 1997 ----------------- ------------------ Salaries and employee benefits $3,996 3,800 Occupancy and equipment expense 1,141 1,021 Deposit Insurance Premium 61 62 Data processing fees 333 138 Other expense 1,843 2,123 ------ ------ TOTAL NONINTEREST EXPENSE $7,374 $7,144 ====== ====== 12 Nine Months Ended ----------------- September 30, 1998 September 30, 1997 ------------------ ------------------ Salaries and employee benefits $11,745 10,845 Occupancy and equipment expense 3,197 2,904 Deposit Insurance Premium 178 194 Data processing fees 504 360 Other expense 6,078 5,717 ------- ------- TOTAL NONINTEREST EXPENSE $21,702 $20,020 ======= ======= Total noninterest expense for the nine months ended September 30, 1998 was $1,682,000 higher than during the same period in 1997. Salaries and employee benefits for the nine months ended September 30, 1998, were $900,000 higher than during the same period in 1997. The increase in salaries and employee benefits resulted from normal increases in salaries and bonuses and salaries and benefits for the employees of the Douglas branch of Citizens Security Bank, which expenses are only included for approximately three months in the operation for the nine months ended September 30, 1997. Deposit insurance premiums for the nine months ended September 30, 1998 was $16,000 lower than during the same period in 1997. Data processing fees for the nine months ended September 30, 1998 was $144,000 higher than during the same period in 1997. Other operating expense for the nine months ended September 30, 1998 increased $361,000 as compared to the same period in 1997. 13 Following is a condensed summary of net income during the three and nine months ended September 30, 1998 and 1997 (dollars in thousands). Three Months Ended ------------------ September 30, 1998 September 30, 1997 ------------------ ------------------ Net interest income $8,517 $8,072 Provision for loan losses 819 610 Other income 1,968 1,934 Other expense 7,374 7,144 ------ ------ Income before income taxes 2,292 2,252 Applicable income taxes 790 724 ------ ------ NET INCOME $1,502 $1,528 ====== ====== Nine Months Ended ----------------- September 30, 1998 September 30, 1997 ------------------ ------------------ Net interest income $24,922 $24,195 Provision for loan losses 4,139 1,715 Other income 6,079 5,642 Other expense 21,702 20,020 ------- ------- Income before income taxes 5,160 8,102 Applicable income taxes 1,805 2,691 ------- ------- Net income $ 3,355 $ 5,411 ======= ======= Net income decreased $2,056,000 or 38.0% to $3,355,000 for the nine months ended September 30, 1998 as compared to $5,411,000 for the nine months ended September 30, 1997. Net interest income of ABC and its subsidiaries increased $727,000, offset by an increase in provision for loan losses of $2,424,000 and an increase in all other noninterest expense of $1,682,000. Net income for the nine months ended September 30, 1998 was severely impacted by the increases in the provision for loan losses in the amount of $2,424,000 as compared with the amount provided for the same period in 1997. 14 COMPARISON OF BALANCE SHEETS Total assets increased by $8.1 million, or 1.17%, to $699.95 million at September 30, 1998 from $691.9 million at December 31, 1997. Total earning assets increased by $24.9 million or 4.04%, to $641.6 million at September 30, 1998 from $616.6 million at December 31, 1997. Total loans, net of the allowance for loan losses, increased by $4.9 million, or 1.02%, to $487.5 million at September 30, 1998 from $482.6 million at December 31, 1997. Total deposits increased by $8.5 million, or 1.42%, to $609.3 million at September 30, 1998 from $600.7 million at December 31, 1997. Approximately 13.46% and 15.00% of deposits were noninterest-bearing as of September 30, 1998 and December 31, 1997, respectively. FORWARD-LOOKING STATEMENTS This document contains statements that constitute "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 words "believe", "estimate", "expect", "intend", "anticipate" and similar expressions and variations thereof identify certain of such forward-looking statements, which speak only as of the dates which they were made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Users are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those indicated in the forward-looking statements as a result of various factors. Users are therefore cautioned not to place undue reliance on these forward-looking statements. 15 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The Company's primary market risk exposure is interest rate risk and, to a lesser extent, credit risk and liquidity risk. The company has little or no risk related to trading accounts, commodities or foreign exchange. Interest rate risk is the exposure of a banking organization's financial condition and earnings ability to adverse movements in interest rates. The Company has analyzed the assumed market value risk and earnings risk inherent in its interest rate sensitive instruments related to interest-rate swings of 200 basis points, both above and below current levels (rate shock analysis). The Company's overall interest rate risk was less than 5.50% of net interest income subjected to rising and falling rates of 200 basis points. Earnings and fair value estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. There have been no significant changes in the Company's market risk exposure since December 31, 1997. Part II. Other Information ITEM 4. 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, 1998. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K There were no exhibits and reports filed on Form 8-K during the quarter ended September 30, 1998. 16 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, 1998 /s/ W. Edwin Lane, Jr. ______________________ _____________________________________ DATE W. EDWIN LANE, JR. EXECUTIVE VICE PRESIDENT & CHIEF FINANCIAL OFFICER (Duly authorized officer and principal financial/accounting officer) 17 EX-27 2 FINANCIAL DATA SCHEDULE
9 1,000 9-MOS DEC-31-1998 JAN-01-1998 SEP-30-1998 49,533 0 970 0 98,829 19,584 20,269 498,428 10,883 699,954 609,254 6,064 6,845 8,350 0 0 7,525 61,916 699,954 38,647 5,580 643 44,870 19,120 19,948 24,922 4,139 0 21,702 5,160 5,160 0 0 3,355 .46 .46 5.33 14,498 0 0 14,498 7,627 1,234 351 10,883 10,883 0 10,883
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