-----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, GF63W/ToedGhegF0ct2lFvZMfvK6sZclmg4rvpAabYuxaQKQ5BJYdai92kB2lxp1 7f4Q12QrpW3AtzAizNQP9A== 0000706129-95-000008.txt : 19951119 0000706129-95-000008.hdr.sgml : 19951119 ACCESSION NUMBER: 0000706129-95-000008 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951113 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: HORIZON BANCORP /IN/ CENTRAL INDEX KEY: 0000706129 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 351562417 STATE OF INCORPORATION: IN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-10792 FILM NUMBER: 95589461 BUSINESS ADDRESS: STREET 1: 515 FRANKLIN SQ CITY: MICHIGAN CITY STATE: IN ZIP: 46360 BUSINESS PHONE: 2198790211 MAIL ADDRESS: STREET 1: 515 FRANKLIN SQ CITY: MICHIGAN CITY STATE: IN ZIP: 46360 FORMER COMPANY: FORMER CONFORMED NAME: CITIZENS MICHIANA FINANCIAL CORP DATE OF NAME CHANGE: 19861021 10-Q 1 Form 10-Q SECURITIES AND EXCHANGE COMMISSION 450 5th Street N.W. Washington, D.C. 20549 QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended September 30, 1995 - commission file number 0-10792 HORIZON BANCORP (Exact name of registrant as specified in its charter) Indiana 35-1562417 (State or other jurisdiction (I.R.S. Employer Identification No.) of incorporation or organization) 515 Franklin Square, Michigan City, Indiana 46360 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (219) 879-0211 Securities registered pursuant to Section 12(b) of the Act: NONE Securities registered pursuant to Section 12(g) of the Act: Common Stock, no par value (Title of class) 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 Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 741,010 at November 6, 1995 Part I - Financial Information ITEM 1. FINANCIAL INFORMATION REQUIRED BY RULE 10-01 OF REGULATION S-X IS INCLUDED IN THIS FORM 10-Q AS REFERENCED BELOW [CAPTION] Financial Statements Page [S] [C] [C] Consolidated Balance Sheet (Unaudited) 3 - 4 Consolidated Statement of Income (Unaudited) 5 - 6 Condensed Consolidated Statement of Changes in Stockholders' Equity (Unaudited) 7 Consolidated Statement of Cash Flows (Unaudited) 8 - 9 Notes to the Consolidated Financial Statements (Unaudited) 10 - 15 CONSOLIDATED BALANCE SHEET (UNAUDITED) (Thousands, except per share data) [CAPTION] September 30 December 31 1995 1994 ASSETS Cash and cash equivalents Cash and due from banks $ 16,218 $ 23,821 Money market investment 736 1,063 Federal funds sold 3,250 Total cash and cash equivalents 16,954 28,134 Short-term investments-interest-bearing balances in banks 100 100 Investment securities available for sale, net (Note 2) 77,550 83,142 Investment securities held to maturity, net (Note 2) (Estimated market value of $14,543 at September 30, 1995 and $15,225 at December 31, 1994) 14,537 15,475 Loans Total loans (Note 3) 231,937 225,016 Deferred loan fees (430) (462) Unearned income (804) (932) Allowance for loan losses (Note 4) (2,781) (2,555) Net loans 227,922 221,067 Premises and equipment, net 10,874 10,445 Accrued interest receivable 2,665 2,807 Other assets 6,027 8,300 Total assets $ 356,629 $ 369,470 ======= =======
- Continued - CONSOLIDATED BALANCE SHEET (UNAUDITED (CONTINUED) (Thousands, except per share data) [CAPTION] September 30 December 31 1995 1994 LIABILITIES Deposits Noninterest-bearing $ 35,273 40,686 Interest-bearing 248,906 255,098 Total deposits 284,179 295,784 Short-term borrowings 8,279 6,693 Federal Home Loan Bank Advances 15,400 18,400 Federal Funds purchased 13,900 18,000 Obligation to employee stock ownership plan 298 Accrued interest payable 640 466 Other liabilities 2,526 2,416 Total liabilities 324,924 342,057 Commitments, off-balance sheet risk and contingencies STOCKHOLDERS' EQUITY Common stock: $1 stated value, 5,000,000 shares authorized; 1,027,531 shares issued 1,027 1,027 Additional paid-in capital 17,363 17,293 Retained earnings 20,790 18,961 Valuation allowance for securities available for sale (net of tax) (Note 2) 95 (2,327) Total before treasury stock and obligation to employee stock ownership plan 39,275 34,954 Less treasury stock, at cost - 114,107 shares at September 30, 1995 and 93,745 shares at December 31, 1994 (2,945) (2,243) Unearned Compensation (4,625) (5,000) Less obligation under employee stock ownership plan (298) Total stockholder' equity 31,705 27,413 Total liabilities and stockholders' equity $356,629 $369,470 ======= =======
- Continued - CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) (Thousands, except per share data) [CAPTION] Three Months Ended Nine Months Ended September 30 September 30 1995 1994 1995 1994 INTEREST INCOME Interest and fees on loans $ 5,174 $ 4,665 $14,875 $13,687 Interest on balances in banks 1 2 Interest on Federal funds sold 19 41 Interest and dividends on investment: Taxable 1,308 1,279 4,126 3,529 Nontaxable 120 153 416 459 Total interest income 6,602 6,098 19,436 17,718 INTEREST EXPENSE Interest on deposits 2,317 1,852 6,841 5,489 Interest on Federal funds purchased and securities sold under agreement to repurchase 227 221 706 396 Interest on Federal Home Loan Bank Advances 212 349 675 890 Total interest expense 2,756 2,422 8,222 6,775 NET INTEREST INCOME 3,846 3,676 11,214 10,943 PROVISION FOR LOSSES (Note 4) 165 NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 3,846 3,676 11,214 10,778 NONINTEREST INCOME Service charges on deposits 365 370 1,060 991 Trust departments income 433 422 1,310 1,266 Security gains/(losses) (16) (16) 273 Gain on sale of other real estate owned 472 45 472 Other income 32 67 421 225 Total other income 814 1,331 2,820 3,227 NONINTEREST EXPENSE Salaries and employee benefits 2,197 1,749 6,094 5,188 Occupancy expense of Company premises, net of rental income 262 245 758 773 Data processing and equipment expense 437 366 1,279 1,089 Loss on real estate owned 31 172 344 386 Other expenses 1,005 1,214 3,186 3,311 Total other expense 3,932 3,746 11,661 10,747
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) (CONTINUED) (Thousands, except per share data) [CAPTION] Three Months Ended Nine Months Ended September 30 September 30 1995 1994 1995 1994 INCOME BEFORE INCOME TAXES $ 728 $1,261 $2,373 $3,258 PROVISION(BENEFIT) FOR INCOME TAXES 11 403 (286) 1,117 NET INCOME $ 717 $ 858 $2,659 $2,141 Average number of shares outstanding 757,195 767,367 757,807 768,058 Earnings per common share $ .95 $1.12 $3.51 $2.79
Earnings per common share have been calculated using the average number of shares outstanding during the periods presented. See notes to the consolidated financial statements. CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED) (In Thousands) [CAPTION] Three Months Ended Nine Months Ended September 30 September 30 1995 1994 1995 1994 Balance, beginning of period $30,816 $27,991 $27,413 $27,759 Net income 717 858 2,659 2,141 Cash dividends ($.90 for the nine months ended September 30, 1995 and 1994) (274) (230) (830) (691) Reduction in ESOP obligation 298 297 Purchase of Treasury Stock (256) (35) (702) (47) Amortization of unearned compensation expense 274 375 Increase in additional paid-in capital from amortization of unearned compensation expense 46 70 Change in unrealized gain(loss) on securities available for sale 382 (468) 2,422 (1,362) Tax benefit of ESOP dividend deduction 4 23 Balance, September 30 $31,705 $28,120 $31,705 $28,120
See notes to the consolidated financial statements. CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED) (In Thousands) [CAPTION] Nine months ended September 30 1995 1994 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 2,659 $ 2,141 Adjustments to reconcile net income to net cash from operating activities: Depreciation 638 513 Net amortization 117 204 Amortization of unearned compensation 375 Valuation allowance for security (gains)/losses (4,087) 2,336 Provision for loan losses 165 Security (gains)/loss 16 (273) Loss on disposal of fixed assets 24 Loss on other real estate owned 239 59 Change in deferred taxes (82) 69 Change in deferred loan fees (32) (40) Change in unearned income (128) (480) Change in interest receivable 142 (102) Change in interest payable 174 57 Change in other assets 4,608 (3,245) Change in other liabilities 110 (2,710) Net cash provided by activities 4,773 (676) CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from sales of investment securities- available for sale 8,999 14,859 Proceeds from maturities, calls and principal repayments of investment securities-available for sale 13,430 12,505 Proceeds from maturities, calls and principal repayments of investment securities-held to maturity 3,033 1,554 Purchase of investment securities-available for sale (12,676) (35,583) Purchase of investment securities-held to maturity (2,303) (2,282) Net increase in loans (6,339) (507) Purchase of loans (1,122) (605) Proceeds from sales of loans 353 2,700 Recoveries on loans previously charged off 413 265 Premises and equipment expenditures (1,090) (870) Proceeds from disposal of premises and equipment (7) Net cash provided by (used in) investing activities 2,698 (7,971)
See notes to the consolidated financial statements. CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED) (UNAUDITED) (Thousands) [CAPTION] Nine months ended September 30 1995 1994 CASH FLOWS FROM FINANCING ACTIVITIES: Net decrease in deposits (11,605) (17,487) Dividends paid (830) (691) Net increase/(decrease) in short-term borrowings (2,514) 11,619 Purchase of Treasury stock (702) (47) Increase in Federal Home Loan Bank Advances (3,000) 6,500 Net cash provided by (used in) financing activities (18,651) 2,186 NET CHANGE IN CASH AND CASH EQUIVALENTS (11,180) (8,753) CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 28,134 25,055 CASH AND CASH EQUIVALENTS AT END OF QUARTER $16,954 $16,302 CASH PAID DURING THE YEAR FOR: Interest $ 8,048 $ 6,832 Income taxes 790 993
See notes to the consolidated financial statements. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE 1 - BASIS OF PRESENTATION The accompanying consolidated financial statements include the accounts of Horizon Bancorp ("Horizon") and its wholly-owned subsidiaries, First Citizens Bank, N.A. ("Bank") and HBC Insurance Group, Inc. All intercompany balances and transactions have been eliminated. The results of operations for the period ended September 30, 1995 and 1994 are not necessarily indicative of the operating results for the full year of 1995 or 1994. These interim financial statements are prepared without audit and reflect all adjustments (consisting of normal recurring adjustments) which, in the opinion of management, are necessary to present fairly the consolidated position of Horizon Bancorp at September 30, 1995 and its results of operations and cash flows for the periods presented. The accompanying consolidated financial statements do not purport to contain all the necessary financial disclosure required by generally accepted accounting principals that might otherwise be necessary in the circumstances and should be read in conjunction with the 1994 Horizon Bancorp consolidated financial statements and related notes thereto included in its Annual Report for the year ended December 31, 1994. NOTE 2 - INVESTMENT SECURITIES AVAILABLE FOR SALE AND HELD TO MATURITY The amortized cost and estimated fair value of investment securities available for sale and held to maturity at September 30, 1995 are as follows: [CAPTION] (Thousands) Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value AVAILABLE FOR SALE: U.S. Treasury and U.S. Government agency securities $ 7,171 $ 5 $ (7) $ 7,169 Other Securities 1,053 (23) 1,030 Subtotal 8,224 5 (30) 8,199 FHLMC 25,440 248 (90) 25,598 FNMA 30,988 177 (73) 31,092 GNMA 9,492 120 (25) 9,587 Total mortgage-backed securities 65,920 545 (188) 66,277 Total debt securities 74,144 550 (218) 74,476 Equity securities 3,240 (166) 3,074 Total investment securities available for sale $77,384 $ 550 $ (384) $77,550 ======= ==== ===== ======= HELD TO MATURITY: U.S. Government agency securities $ 3,235 $ 3,235 Obligations of states and political subdivisions 11,302 43 (37) 11,308 Total debt securities 14,537 43 (37) 14,543 Total debt securities, held to maturity $14,537 $ 43 $ (37) $14,543 ======= ==== ===== =======
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) NOTE 2 - INVESTMENT SECURITIES AVAILABLE FOR SALE AND HELD TO MATURITY (CONTINUED) The amortized cost and estimated fair value of debt securities at September 30, 1995, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. [CAPTION] (Thousands) Amortized Fair Cost Value AVAILABLE FOR SALE: Due in one year or less $ 1,019 $ 1,017 Due after one year through five years 7,205 7,182 Subtotal 8,224 8,199 Mortgage-backed securities 65,920 66,277 Total debt securities available for sale $74,144 $74,476 ====== ====== HELD TO MATURITY: Due in one year or less $ 4,897 $ 4,898 Due after one year through five years 6,067 6,052 Due after five years through ten years 3,573 3,593 Total debt securities held to maturity $14,537 $14,543 ====== ======
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) NOTE 2 - INVESTMENT SECURITIES AVAILABLE FOR SALE AND HELD TO MATURITY (CONTINUED) The amortized cost and estimated fair value of investment securities at December 31, 1994 are as follows: [CAPTION] (Thousands) Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value AVAILABLE FOR SALE: U.S. Treasury and U.S. Government agency securities $18,034 $ $ (289) $17,745 Other Securities 2,078 (92) 1,986 Subtotal 20,112 (381) 19,731 FHLMC 28,067 (1,471) 26,596 FNMA 25,637 (1,180) 24,457 GNMA 10,000 (724) 9,276 Total mortgage-backed securities 63,704 (3,375) 60,329 Total debt securities 83,816 (3,756) 80,060 Equity securities 3,249 (167) 3,082 Total investment securities available for sale $87,065 $ $(3,923) $83,142 ======= ==== ===== ======= HELD TO MATURITY: U.S. Government agency securities $ 3,521 $ 3,521 Obligations of states and political subdivisions 11,954 3 (253) 11,704 Total debt securities 15,475 3 (253) 15,225 Total debt securities, held to maturity $15,475 $ 3 $ (253) $15,225 ======= ==== ===== ======
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) NOTE 3 - TOTAL LOANS Total loans are comprised of the following classifications: [CAPTION] (In Thousands) September 30 December 31 1995 1994 Commercial $ 64,257 $ 67,177 Real estate mortgage 114,817 105,974 Installment 52,863 51,865 Total loans $ 231,937 $ 225,016 ======= =======
NOTE 4 - ALLOWANCE FOR LOAN LOSSES The following is an analysis of the activity in the allowance for loan losses account: [CAPTION] (In Thousands) September 30 December 31 1995 1994 Balance, beginning of period $2,555 $2,310 Provision charged to expense 165 Recoveries 413 301 Loan charge-offs (187) (221) Balance, end of period $2,781 $2,555 ===== =====
NOTE 5 - NONPERFORMING ASSETS: The following is a summary of nonperforming loans and Other Real Estate Owned (OREO). OREO is presented before the allowance for OREO losses: [CAPTION] (In Thousands) September 30 December 31 1995 1994 Nonperforming Loans $2,966 $3,268 OREO before allowance for OREO losses 4,070 5,730 Total nonperforming assets $7,036 $8,998 ===== =====
The following is an analysis of the activity in the allowance for OREO account: [CAPTION] (In Thousands) September 30 December 31 1995 1994 Balance at beginning of period $ 1,801 $ 1,988 Losses on OREO charged to expense 24 59 Losses charged to the allowance (774) (246) Balance at end of period $ 1,051 $ 1,801 ===== =====
Horizon adopted Statement of Financial Accounting Standards FAS 114 "Accounting by Creditors for Impairment of a Loan" as of January 1, 1995. At September 30, 1995 impaired loans outstanding totaled $1,257,000 and average outstanding totaled $1,399,000, the reserves related to these loans totaled $369,000. There was no adjustment to the provision or reserve for these loans. Payments received on an impaired loan are applied toward principal unless full recovery of principal and interest is not in doubt and the loan is well secured, then payments are applied to interest. FOR THE QUARTER ENDED SEPTEMBER 30, 1995 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS INTRODUCTION The purpose of this discussion is to focus on the Company's financial condition, changes in financial condition and the results of operations in order to provide a better understanding of the consolidated financial statements included elsewhere herein. This discussion should be read in conjunction with the consolidated financial statements and the related notes. FINANCIAL CONDITION LIQUIDITY In managing its liquidity, the Company's objective is to maintain the ability to continuously meet its cash flow needs and those of its customers.A major source of liquidity is the investment portfolio, as well as money market investments and interest-bearing balances in banks. At September 30, 1995, securities available for sale and held to maturity with a maturity of one year or less were $5.9 million, 6.67% of the portfolio, compared to $13.6 million or 13.8% at December 31, 1994. Federal funds sold, money market investments and interest-bearing balances with other banks added an additional $.8 million in funds maturing within one year at September 30, 1995 compared to $4.4 million at December 31, 1994. These investments which are short-term in nature, are expected to provide adequate liquidity to fund loan growth and any possible deposit fluctuations. The Company's loan-to-deposit ratio, another indication of overall liquidity increased to 81.2% at September 30, 1995 from 75.6% at year end 1994. The Company's subsidiary bank joined The Federal Home Loan Bank of Indianapolis in 1991 through the purchase of $2.4 million in Federal Home Loan Bank Stock. Members are entitled to advances for the purpose of funding mortgage lending activities. Bank considers this membership another source of liquidity for future balance sheet growth. There were $15.4 million in outstanding borrowings at September 30, 1995 as a result of this membership. In addition to these borrowings at September 30, 1995, Bank has available approximately $16.6 million in unused credit lines with various money center banks. There have been no other material changes in the liquidity of the Company from December 31, 1994 to September 30, 1995. CAPITAL RESOURCES Stockholders' equity at September 30, 1995 totaled $31.7 million up 15.7 % compared to $27.4 million December 31, 1994. This increase is primarily the result of a decline in the valuation allowance for securities available for sale as well as year to date 1995 net income retained (net of dividends paid). As of September 30, 1995, management is not aware of any current recommendation by banking regulatory authorities which, if there were to be implemented, would have or are reasonably likely to have a material effect on Horizon's liquidity, capital resources or operations. As previously disclosed in the Company's third quarter 1993 Form 10-Q, the Compensation Committee of the Board initially discussed the continuation of the Company's employee retirement benefit program in early 1993, which is maintained as an Employee Stock Ownership Plan. In August of 1993, the Board of Directors approved the continuation of this plan and authorized the transfer of 172,414 shares of the Company's stock into the Employee Stock Ownership Trust for future allocation to employee retirement accounts. The transfer wil be made upon payment to the Company by the Employee Stock Ownership Plan Trust of $5 million which represents a price of $29 per share, the market value of the stock at the time the transaction was approved. Under Federal regulations, the Employee Stock Ownership Trust may pay a value equal to or less than market value for acquired shares, but not more. Upon approval by all the required regulatory agencies, the Company issued 172,414 shares of stock to the Employee Stock Ownership Trust on August 26, 1994. Under Statement of Position 93-6 "Employers Accounting for Employee Stock Ownership Plans" issued by the Accounting Standards Division of the Anerican Institute of Certified Public Accountants, these shares are not included in outstanding shares for the purposes of computing earnings per share and book value per share until they are committed-to-be-released for allocation to employee retirement accounts. Horizon has selectively purchased shares that became available in the market from time to time. During the first nine months of 1995, management purchased 22,362 shares at a cost of $702 thousand. There have been no other material changes in the Company's capital resources from December 31, 1994 to September 30, 1995. MATERIAL CHANGES IN FINANCIAL CONDITION - SEPTEMBER 30, 1995 COMPARED TO DECEMBER 31, 1994 Because of the nature of its activities, Horizon is subject to pending and threatened legal actions that arise in the normal course of business. In management's opinion, after consultation with counsel, none of the litigation to which Horizon or any of its subsidiaries is a party will have a material effect on the consolidated financial position or results of operations of the Corporation. Horizon's deposits declined to $284.2 million at September 30, 1995 compared to $295.8 million at December 31, 1994. This decline is primarily the result of increases in demand deposits of public fund accounts at December 31, 1994 that subsequently declined. There have been no other material changes in the financial condition of the Company from December 31, 1994 to September 30, 1995. RESULTS OF OPERATIONS MATERIAL CHANGES IN RESULTS OF OPERATIONS - SEPTEMBER 30, 1995 COMPARED TO SEPTEMBER 30, 1994. Net interest income was $11.214 million for the first nine months of 1995 compared to $10.943 million for the same period 1994. This increase is primarily the result of higher average earning assets offset by lower year to date net interest margin of 4.37% compared to 4.43% for the same period 1994. Provision for loan losses was zero for the first nine months of 1995 compared to $165 thousand for the same period 1994. Horizon has year to date net loan recoveries at September 30, 1995 of $226 thousand compared to $98 thousand for the same period last year. These recoveries increased Horizon's allowance for loan losses to $2.781 million at September 30, 1995 from $2.555 million at December 31, 1994. Other noninterest income net of nonrecurring portfolio gains, nonrecurring gain on sale of other real estate owned, and nonrecurring interest received on Federal Income Tax refunds was $2.493 million for the first nine months of 1995 compared to $2.482 million for the same period last year. This increase is primarily the result of an increase in service charges on deposit accounts and trust department income. Horizon's operating expenses year to date 1995, net of nonrecurring Loss on Other Real Estate Owned expenses, increased to $11.3 million from $10.4 million for the same period 1994. This increase is the result of increased salaries, employee group health care expenses, investments in technology and owner employee training offset by a $176 thousand FDIC insurance refund resulting from the lowering of the premium per $100 of insured deposits from $.23 to $.04. Included in salaries and employee benefit expense is $358 thousand related to the Employee Stock Ownership Plan discussed under CAPITAL RESOURCES above. Tax benefits resulting from this expense totaled $120 for the nine months ended September 30, 1995. Therefore, 1995 year-to-date net costs associated with this plan total $238 thousand. Horizon received a federal income tax refund during the first quarter totaling $1.190 million including interest of $298 thousand and in the third quarter, received a state tax refund of $62 thousand and a state tax credit that resulted in reducing tax expense by $150 thousand. In 1993, Horizon filed several amended tax returns to obtain refunds of federal and state taxes paid in prior periods. The receipt of these refunds and credits increased earnings per share $1.25 for the first quarter and $.28 for the third quarter. Horizon Bancorp has experienced a decline in quarterly net income during 1995 due to higher non-interest expenses associated with investments in technology, the expansion of it's branch delivery system to new markets, and the training of it's owner employees in intensive internal and external management training courses. Horizon expects an improvement in it's product market share, competitive position and customer service quality in existing and new markets as a result of these investments. These investments will also create re-engineering opportunities that are anticipated to ultimately increase Horizon's efficiency. There have been no other material changes in the results of operations of the Company from December 31, 1994 to September 30, 1995. PART II - OTHER INFORMATION For the quarter ended September 30, 1995 ITEM 1. LEGAL PROCEEDINGS See Management's Discussion and Analysis ITEM 2. CHANGES IN SECURITIES Not Applicable ITEM 3. DEFAULTS UPON SENIOR SECURITIES Not Applicable ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS Not Applicable ITEM 5. OTHER INFORMATION Not Applicable ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K a. January 17, 1995 - Significant matters to shareholders b. March 23, 1995 - Horizon receives $1.190 million income tax refund 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. HORIZON BANCORP BY: Larry E. Reed Chairman and Chief Executive Officer DATE: November 13, 1995 BY: Diana E. Taylor Vice President and Chief Financial Officer DATE: November 13, 1995 EX-27 2
9 9-MOS DEC-31-1995 SEP-30-1995 16,954 248,906 0 0 77,550 14,537 14,543 231,937 2,781 356,629 284,179 37,579 2,526 0 1,027 0 0 0 356,629 14,875 4,542 19 19,436 6,841 8,222 11,214 0 (16) 11,661 2,373 2,373 0 0 2,659 3.51 3.51 7.89 2,499 6,983 0 277 2,555 187 413 2,781 2,781 0 802
-----END PRIVACY-ENHANCED MESSAGE-----