-----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, EhW1mjNeRxBu4d9TYk4DwhRtigSG0Az6HBGDfjHNoY5vn+dmeoeuYRdDQAKrTPlK gYYx1Mf99kl5lOp8B5YPsA== 0000950148-95-000751.txt : 19951119 0000950148-95-000751.hdr.sgml : 19951119 ACCESSION NUMBER: 0000950148-95-000751 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951113 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BKLA BANCORP CENTRAL INDEX KEY: 0000716615 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 953840703 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-12851 FILM NUMBER: 95589293 BUSINESS ADDRESS: STREET 1: 8901 SANTA MONICA BLVD CITY: WEST HOLLYWOOD STATE: CA ZIP: 90069 BUSINESS PHONE: 3105508900 MAIL ADDRESS: STREET 1: 8901 SANTA MONICA BLVD P O BOX 69740 STREET 2: 8901 SANTA MONICA BLVD P O BOX 69740 CITY: WEST HOLLYWOOD STATE: CA ZIP: 90069 10-Q 1 FORM 10-Q FOR QUARTER ENDED SEPTEMBER 30, 1995 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (X) Quarterly Report under Section 13 or 15 (D) Of the Securities Exchange Act of 1934 ( ) Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For Quarter Ended September 30, 1995 Commission File #0-12851 BKLA BANCORP ------------------------------------------------------ (Exact name of registrant as specified in its charter) California 95-3840703 ----------------------------- ----------------------------- (State or other jurisdiction) (IRS Employer Identification) 8901 Santa Monica Blvd., West Hollywood, California 90069 ---------------------------------------------------- ----- (Address of principal executive offices) (Zip Code)
(310) 550-8900 ---------------------------------------------------- (Registrant's telephone number, including area code) 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 --- --- Applicable Only to Corporate Issuers ------------------------------------ Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Common Stock, no par value 5,987,125 -------------------------- --------- Class Outstanding on September 30, 1995
This Form 10-Q contains 24 pages. 2 MANAGEMENT'S DISCUSSION AND ANALYSIS AND FINANCIAL STATEMENTS BANK OF LOS ANGELES September 30, 1995 and 1994 (unaudited) and December 31, 1994 CONTENTS MANAGEMENT'S DISCUSSION AND ANALYSIS FINANCIAL STATEMENTS BALANCE SHEET PAGE 15 STATEMENTS OF OPERATIONS PAGE 16 STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY PAGE 17 STATEMENTS OF CASH FLOWS PAGE 18 NOTES TO FINANCIAL STATEMENTS PAGE 20 OTHER INFORMATION PAGE 23 SIGNATURES PAGE 24
3 Management's Discussion and Analysis I. Overview Net income for the nine months ended September 30, 1995 was $288,000 or $0.05 per share, as compared to a net loss of $787,000 or $0.63 per share for the same period of 1994. Net income for the quarter ended September 30, 1995 was $284,000 or $0.04 per share, as compared to a net loss of $233,000 or $0.19 per share for the same period of 1994. Management's evaluation of the allowance for credit losses has concluded that the allowance is in excess of what is required for identified risks and for losses inherent in the portfolio. At September 30,1995 the allowance for credit losses balance was $1,486,000; $523,000 was determined to be in excess of required reserves. Recoveries made in 1995 for loans charged-off in prior years have been added to the allowance with a corresponding reduction to the allowance by crediting the provision for credit losses $260,000 for the nine months and $78,000 for the quarter ended September 30,1995. No provision or credit to the provision for credit losses was made during the nine months or quarter ended September 30, 1994. The ratio of allowance for credit losses to loans outstanding was 3.7% at September 30, 1995. Gain on sale of loans of $118,000 was realized during the quarter ended September 30, 1995 and there was no gain or loss on sale of loans during 1994. Gain on sale is from one loan as a result in an increase in the value of the real estate securing the loan. The Bank does not have available for sale loans. In March of 1995, Investors Banking Corp., a holding company, invested $3,549,000 into BKLA Bancorp becoming the owner of approximately 79% of the BKLA Bancorp. Effective October 23, 1995, BKLA Bancorp and the Bank of Los Angeles were merged, with the Bank of Los Angles as the survivor. At the same time, a one-for-five reverse stock split was made to increase the potential market price to obtain a listing on NASDAQ. On November 15, 1995 shareholders of Bank of Los Angeles and shareholders of World Trade Bank (WTB) will vote to adopt and approve the Agreement and Plan of Reorganization for the Bank of Los Angeles to acquire WTB, with the Bank of Los Angels as the surviving institution. All of the directors and executive officers and principal shareholders owning approximately 85% of the Bank of Los Angeles and 94% of WTB have indicated that they intend to vote their shares in favor of the Reorganization Agreement. Accordingly, the Reorganization Agreement will be approved and adopted by more than the vote legally required. WTB is a Beverly Hills based Bank with approximate assets of $49 million. Current shareholders have been offered the right to purchase 15 shares of Bank of Los Angeles Common Stock and five Warrants at a subscription price of $56.25 for every six shares owned as of record date. Each Warrant entitles the holder to purchase one share of BKLA Common Stock at an $3.75 exercise price. The rights offering expires November 30, 1995. Investors Banking Corp. has agreed to be a standby purchaser for shares that are not purchased by current shareholders. The proceeds of this Offering are estimated to be at a minimum, approximately $1,952,000 and at a maximum, approximately $2,443,000. Page 3 4 Management's Discussion and Analysis -- continued II. Statistical Information 1. Distribution of Assets, Liabilities, and Stockholders' Equity; Interest Rates and Interest Differentials The following table shows BKLA's average balances of assets, liabilities and stockholders' equity; the amount of interest income or interest expense; and the average yield or rate for each category of interest-earning assets and interest-bearing liabilities, the net interest spread and net interest yield for the periods indicated:
Nine Month Period Ending September 30, ----------------------------------------------------------------------- 1995 1994 Average Interest Average Average Interest Average Balance Earned/Paid Rate Balance Earned/Paid Rate ------- ----------- ---- ------- ----------- ---- Assets: - ------- Interest earning assets: Federal funds sold $ 4,796 $ 205 5.7% $ 10,360 $ 281 3.6% ------- ----- ---- -------- ----- --- Deposits with financial institutions 24 1 5.6% -- -- -- Securities held to maturity 7,215 333 6.2% 8,457 264 4.2% Securities available for sale 18,677 828 5.9% 17,964 644 4.8% Loans 37,956 3,282 11.5% 44,571 3,073 9.2% ------- ------ ---- -------- ------ --- Total interest earning assets 68,668 4,649 9.0% 81,352 4,262 7.0% Nonearning assets: Cash and due from banks 4,334 5,669 Other assets 5,596 5,434 Allowance for credit losses (1,676) (2,200) ------- -------- Total assets 76,922 90,255 ======= ======== Liabilities and Shareholders' Equity: - ------------------------------------- Interest bearing liabilities: Demand, interest bearing 9,321 90 1.3% 14,664 143 1.3% Money market 11,856 220 2.5% 16,212 278 2.3% Savings (including IRAs) 9,491 227 3.2% 13,275 303 3.0% Time certificates of deposits 12,960 442 4.5% 13,387 306 3.0% ------- ----- ---- -------- ----- --- Total interest bearing deposits 43,628 979 3.0% 57,538 1,030 2.4% Capital lease obligation 1,832 195 14.2% 1,828 192 14.0% Securities sold under agreement to repurchase 1,062 51 6.4% -- -- -- ------- ----- ---- -------- ----- --- Total interest bearing liabilities 46,522 1,225 3.5% 59,366 1,222 2.7% ------- ----- ---- -------- ----- --- Demand deposits, noninterest bearing 23,383 25,178 Other liabilities 1,104 765 Shareholders' equity 5,913 4,946 -------- -------- Total liabilities and shareholders' equity $ 76,922 $ 90,255 ======== ======== Net interest margin spread $ 3,424 5.5% $ 3,040 4.3% ======= ==== ======= ==== Net interest income earned as a percentage of average earning assets 5.9% 4.5% ==== ====
Management's Discussion and Analysis -- continued Page 4 5 2. Investment Portfolio Statement of Financial Accounting Standards ("SFAS") No. 115, "Accounting for Certain Investments in Debt and Equity Securities" addresses the accounting and reporting for investments in equity securities that have readily determinable fair values and all investments in debt securities. BKLA adopted SFAS No. 115 effective January 1, 1994. Under this statement, investments will be classified into three categories, as follows: Securities Held to Maturity -- debt securities that BKLA has the positive intent and ability to hold to maturity. These securities are to be reported at amortized cost. Trading Securities -- debt and equity securities that are bought and held for the purpose of selling them in the near term. These securities are to be reported at fair values, with unrealized gains and losses included in earnings. Securities Available for Sale -- debt and equity securities not classified as either held-to-maturity or trading securities. These securities are to be reported at fair value, with unrealized gains and losses excluded from earnings and reported as a separate component of shareholders' equity (net of tax effects). In March of 1995, Investors Banking Corp., a holding company, invested $3,549,000 into Bank of Los Angeles becoming the owner of approximately 79% of the Bank. The new management determined that the securities held to maturity portfolio could restrict the Bank's ability to manage its interest rate risk and profitability. As a result, the securities held to maturity portfolio was reclassified to securities available for sale. The transfer from held-to-maturity to available-for-sale occurred on June 1, 1995 and the unamortized cost of the portfolio was $9,885,000, market value was $9,965,313 with an unrealized gain of $70,000. The table below summarizes the maturities of BKLA's available for sale portfolio and their weighted average yields at September 30, 1995:
Available for Sale ---------------------------------- Amortized Estimated ($000s) Cost Fair Value Yield --------- ---------- ------ In one year or less . . . . . . . . $ 6,993 $ 6,994 5.4% After one year through five years . 4,935 4,987 7.5% Mortgage-backed securities . . . . 3,763 3,726 6.5% SBA securities . . . . . . . . . . 3,020 2,991 6.6% -------- -------- $ 18,711 $ 18,698 6.4% ======== ========
The following table summarizes the maturities of BKLA's available for sale portfolio and BKLA's held to maturity portfolio and their weighted average yields at December 31, 1994.
Available for Sale Held to Maturity --------------------------- -------------------------------------------- Amortized Estimated Carrying Estimated ($000s) Cost Fair Value Yield Value Fair Value Yield ------------ ------------ ----- ---------- ---------- ----- In one year or less . . . . . . . . . . . $ 2,055 $ 2,026 5.5% $ 7,944 $ 7,889 5.4% After one year through five years . . . . 3,056 2,931 5.9% 6,877 6,778 6.6% Mortgage-backed securities . . . . . . . 4,094 3,870 6.5% $ -- $ -- -- SBA securities . . . . . . . . . . . . . 7,049 6,954 5.5% -- -- -- ------------ ------------ ---------- ----------- $ 16,254 $ 15,781 5.8% $ 14,821 $ 14,667 6.0% ============ ============ ========== ==========
Management's Discussion and Analysis -- continued Page 5 6 2. Investment Portfolio -- continued The following table presents gross unrealized losses and gains on the investment portfolio at September 30, 1995 and December 31, 1994:
September 30, 1995 December 31, 1994 --------------------------------------- ----------------------------------------- Gross Gross Estimated Unrealized Estimated Unrealized Amortized Fair --------------- Amortized Fair ----------------- ($000s) Cost Value Losses Gains Cost Value Losses Gains --------- --------- ------ ------ --------- ---------- ------- ------ Securities held to maturity: . . $ -- $ -- $ -- $ -- $ 14,281 $ 14,667 $ 154 $ -- Securities available for sale: Securities of U.S. government agencies and corporations . . . . . . . . . 11,928 11,981 13 65 5,111 4,957 154 -- Mortgage-backed securities. . . . 3,763 3,726 38 1 4,094 3,870 224 -- SBA securities . . . . . . . . . 3,020 2,991 33 5 7,049 6,954 95 -- ---------- ------- ---- ---- -------- --------- ------- ----- $ 18,711 $18,698 $ 84 $ 71 $ 16,254 $ 15,781 $ 473 $ -- ========== ======= ==== ==== ======== ========= ======= =====
The following is information relating to sales of debt securities at the end of the periods indicated
Nine Months Ended Year Ended ($000s) September 30, December 31, 1995 1994 ------------- ------------ Proceeds from sale of securities . . . . . $ 4,623 $-- Gross realized losses . . . . . . . . . . . 33 -- Gross realized gains . . . . . . . . . . . -- --
Page 6 7 Management's Discussion and Analysis -- continued 3. Loan Portfolio TYPES OF LOANS. Predominantly all of BKLA's loans, commitments, and commercial and standby letters of credit have been granted to customers in BKLA's market area. To comply with regulatory requirements, BKLA does not extend credit to any single borrower or group of related borrowers in excess of 25% of capital for secured credits and 15% of capital for unsecured credits. Capital is defined as the total of the allowance for credit losses plus shareholders' equity.
September 30, 1995 1994 ------------------------- ------------------------- ($000s) Amount Percentage Amount Percentage ----------- ---------- ------------ ---------- Commercial loans . . . . . . . . $ 10,206 25.5% $ 10,165 26.5% Real estate loans: Single family . . . . . . . . . 3,219 8.1% 2,510 6.6% Multi-family . . . . . . . . . 1,196 3.0% 270 0.7% Commercial . . . . . . . . . . 21,516 53.7% 20,457 53.5% ----------- ----- ------------ ----- Total real estate loans . . . . 25,931 64.8% 23,237 60.8% Consumer loans . . . . . . . . . 3,876 9.7% 4,848 12.7% ----------- ----- ------------ ----- Total loans . . . . . . . . . . 40,013 100.0% $ 38,250 100.0% Less deferred loan origination (143) ===== (136) ===== fees . . . . . . . . . . . . . Less allowance for credit losses (1,486) (1,633) ----------- ------------ Net loans . . . . . . . . . . . . $ 38,384 $ 36,481 =========== ============
RISK ELEMENTS BKLA places a loan on nonaccrual status if any of the following conditions occur: deterioration in the financial condition of the borrower, payment in full of principal or interest is not expected, or principal or interest has been in default for a period of 90 days or more unless the asset is both well secured and in the process of collection. The following table presents loans past due 30 through 89 days and still accruing, loans on nonaccrual and restructured loans for the periods indicated
December 31, September 30, ------------------------- ($000s) 1995 1994 1993 -------------- ----------- ------------ Past due 30 through 89 days . $ 200 $ 6 $ 209 Loans on nonaccrual . . . . . 23 838 3,619 Restructured loans . . . . . . -- -- -- ------------- ----------- ------------ Total . . . . . . . . . . $ 223 $ 844 $ 3,828 ============= =========== ============
Page 7 8 Management's Discussion and Analysis -- continued 3. Loan Portfolio, Risk Elements -- continued The policy of the Company is to review each loan in the portfolio to identify problem credits. There are three classifications for problem loans: "substandard", "doubtful" and "loss". Substandard loans have one or more defined weaknesses and are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. Doubtful loans have the weakness of substandard loans with the additional characteristic that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions and values questionable, and there is a high possibility of loss. A loan classified loss is considered uncollectible and of such little value that the continuance as an asset of the institution is not warranted. Another category designated "special mention" is maintained for loans which do not currently expose the Bank to a sufficient degree of risk to warrant classification as substandard, doubtful or loss but do possess credit deficiencies or potential weakness deserving management's close attention. Excluding loans which have been classified loss and charged off by the Bank, classified and special mentioned loans were as follows at the dates indicated:
September 30, December 31, ($000s) 1995 1994 ----------------- ------------------ Doubtful loans . . . . . . . . . . $ 17 $ 13 Substandard . . . . . . . . . . . . 3,826 4,581 Special mentioned loans . . . . . . 2,374 3,157 ------------------ ------------------ $ 6,217 $ 7,751 ================== ================== Classified and special mention loans as a percentage of total loans . . . . . . . . . . . . . . 15.6% 20.3%
4. Summary of Loan Loss Experience ANALYSIS OF THE ALLOWANCE FOR CREDIT LOSSES. BKLA's management believe that the allowance for credit losses is maintained at a level adequate to absorb probable losses. Management determines the adequacy of the allowance based upon reviews of individual credits, recent loss experience, current economic conditions, the risk characteristics of the various categories of loans and other pertinent factors. Credits deemed uncollectible are charged to the allowance. At September 30, 1995 $523,000 of the total $1,486,000 in allowance for credit loss was not allocated to the loan portfolio, representing an additional allowance above the identified required allowance. The ratio of allowance for credit losses to loans outstanding at September 30, 1995 was 3.7%. Provisions for credit losses and recoveries on loans previously charged off are added to the allowance. Commercial and real estate loans are charged off when principal and interest are past due and unpaid for six months, unless the loan is well secured and in the process of collection or management determines that loan is uncollectible and the charge off should be taken prior to the six month delinquency period. Consumer loans are charged off when three or more contractual payments have not been received unless management determines that special circumstances require alternative treatment. Management's Discussion and Analysis -- continued Page 8 9 3. Loan Portfolio, Analysis of the Allowance for Credit Losses -- Continued BKLA adopted SFAS No. 114, as amended by SFAS No. 118 "Accounting by Creditors for Impairment of a Loan -- Income Recognition and Disclosures" ("SFAS No. 114"). SFAS No. 114 requires that a creditor recognize impairment of a loan if the present value of expected future cash flows discounted at the loan's effective interest rate is less than the recorded investment in the impaired loan. If the present value of expected future cash flows is equal to or greater than the recorded investment in the impaired loan, no impairment is recognized. If the measurement of the impaired loan is less than the recorded investment in the loan, a creditor shall recognize an impairment by creating a valuation allowance with a corresponding charge to bad-debt expense or by adjusting an existing valuation allowance for the impaired loan with a corresponding charge or credit to bad-debt expense. BKLA's adoption was effective January 1, 1995 and did not materially impact the allowance for credit losses and had no impact the provision for credit losses expense. Impaired loan valuation analysis is independent of the specific and general allowances for credit losses. The Bank identifies loans as impaired when one of the following four conditions has occurred: 1) loan is maintained on a cash basis because of deterioration in the financial condition of the borrower; 2) full payment of principal and interest is not expected for the loan; 3) principal or interest on loan has been in default for a period of 90 days or more; and 4) management has determined that a loan is impaired from other credit reviews of the loan. Loans are identified and evaluated individually. Loans are not aggregated by similar risk and characteristics. At September 30, 1995, $23,000 of loans were identified as impaired for which no additions to the allowance for credit losses were made. Average recorded investment in these loans is $430,000 for the nine month period ended September 30, 1995.
Nine Months Ended Years Ended September 30, December 31, ($000s) 1995 1994 -------------- -------------- Loans outstanding at end of period . . . . . . . $ 39,870 $ 38,250 Average loans outstanding . . . . . . . . . . . $ 37,956 $ 42,939 Allowance for credit losses at beginning of period $ 1,633 $ 2,478 Charge-offs: Commercial . . . . . . . . . . . . . . . . (96) (907) Real estate . . . . . . . . . . . . . . . (32) (257) Consumer . . . . . . . . . . . . . . . . . (19) (137) ---------- --------- Total . . . . . . . . . . . . . . . . . . . . . (147) (1,301) Recoveries: Commercial . . . . . . . . . . . . . . . . 125 380 Real estate . . . . . . . . . . . . . . . 115 44 Consumer . . . . . . . . . . . . . . . . . 20 32 ---------- --------- Total . . . . . . . . . . . . . . . . . . . . . 260 456 ---------- --------- Net loans charged off . . . . . . . . . . . . . 113 (845) Provision charged to operations . . . . . . . . (260) 0 Allowance for credit losses as of end of period $ 1,486 $ 1,633 ========== ========= Ratio of net charge-offs to average loans (0.3)% 2.0% outstanding . . . . . . . . . . . . . . . . . . ========== ========= Ratio of allowance for credit losses to loans outstanding at the end of the period . . . . 3.7% 4.3% ========== =========
Page 9 10 Management's Discussion and Analysis -- continued 5. Deposits DEPOSITS BY CATEGORY. Deposits have historically been the major source of BKLA's funds for lending and investments. Noninterest-bearing demand deposits payable immediately upon demand or are issued with an original maturity or required notice period of less than seven days. On interest-bearing demand deposits accounts BKLA has reserved the right to require at least seven days written notice prior to withdrawal of any funds in that account. Money market deposit accounts are interest-bearing and are limited to six transfers to third parties. Savings deposits are interest-bearing and do not allow third-party transfers. Time certificates of deposit have a minimum maturity of seven days and are subject to early withdrawal penalties. The following table presents information concerning total deposits outstanding at the dates indicated.
September 30, December 31, ($000s) 1995 1994 ----------------- ------------------ Demand, noninterest-bearing . . . . . . . . $ 23,579 $ 25,128 Demand, interest-bearing . . . . . . . . . . 10,252 9,926 Money market . . . . . . . . . . . . . . . . 12,474 14,541 Savings . . . . . . . . . . . . . . . . . . 8,120 11,382 Time certificates of deposit under $100,000 8,532 6,072 Time certificates of deposit $100,000 and over . . . . . . . . . . . . . . . . . . . 7,465 7,422 ----------------- ------------------ Total deposits . . . . . . . . . . . . . . $ 70,422 $ 74,471 ================= ==================
DEPOSITS AVERAGE BALANCE AND RATE PAID. The following table presents information for average deposits and the average rate paid on those deposits for each of the periods indicated.
September 30, December 31, ---------------------- -------------------- ($000s) 1995 % 1994 % ---------- ----- ---------- ---- Noninterest-bearing demand . . $ 23,383 0.0% $ 25,451 0.0% Interest-bearing demand . . . 9,321 1.3% 13,910 1.3% Money Market . . . . . . . . . 11,856 2.5% 16,313 2.3% Savings . . . . . . . . . . . 9,491 3.2% 12,961 4.1% Time certificates of deposit . 12,960 4.5% 12,868 3.2% ---------- ----- ---------- ---- Total deposits . . . . $ 67,011 1.9% $ 81,503 1.8% ========== ===== ========== ====
Page 10 11 Management's Discussion and Analysis -- continued 5. Deposits TIME CERTIFICATES OF DEPOSIT MATURITIES. The following table presents the maturity distribution of time certificates of deposit in categories of $100,000 and over and under $100,000 as of September 30, 1995.
Time Time Certificates Certificates of Total Time of Deposit Deposit $100,000 Certificates ($000s) Under $100,000 and Over of Deposit -------------- ---------------- ------------ Three months or less . . . . . . . . . $ 4,288 $ 4,805 $ 9,093 Over three months through six months . 2,051 1,577 3,628 Over six months through twelve months 1,940 1,083 3,023 Over twelve months . . . . . . . . . . 253 -- 253 ------------- ------------- ----------- Total . . . . . . . . . . . . . . . . $ 8,532 $ 7,465 $ 15,997 ============= ============= ===========
6. Return on Equity and Assets The following table presents certain important ratios from BKLA for the periods indicated.
Nine Months Ended Year Ended September 30, December 31, 1995 1994 ------------- ------------ Return on average assets . . . . . . . 0.5% (1.4)% Return on average shareholders' equity 6.5% (26.0)% Average equity to average assets . . . 7.7% 5.2%
7. Short-term Borrowings The following table presents short-term borrowings outstanding and the maximum month-end balance during the six-month period ended for September 30, 1995. For the years 1994 and 1993 no agreements to repurchase securities were made.
September 30, 1995 ---------------------------- Maximum Month-end ($000s) Amount Balance of Period -------- ----------- Securities sold under an agreement to repurchase $ -- $ 4,000 Federal funds purchased . . . . . . . . . . . -- -- -------- ------- Total . . . . . . . . . . . . . . . . . . . . $ 0 $ 4,000 ======== =======
Page 11 12 Management's Discussion and Analysis -- continued 7. Short-term Borrowings The following table presents the average balance and average rate paid for short-term borrowings for the nine-month period ended September 30, 1995. For the year 1994 no agreements to repurchase securities were made.
September 30, 1995 ---------------------- Average Average ($000s) Balance Rate Paid ---------- --------- Securities sold under an agreement to repurchase $ 1,062 6.4% Federal funds purchased . . . . . . . . . . . -- -- ---------- --- Total . . . . . . . . . . . . . . . . . . . . $ 1,062 6.4% ========== ===
III Capital Resources Total stockholders' equity totaled $8,008,000 or $1.34 per share as of September 30, 1995, and $3,817,000 or $3.05 per share as of December 31, 1994. The following table reflects various measures of capital at September 30, 1995 and December 31, 1994.
FDIC September 30, December 31, Minimum Regulatory 1995 1994 Capital Requirements ------------- ------------ -------------------- Tier 1 capital to total average assets . . . . . . . . . . . . 7.7% 3.0% 4.0% Tier 1 capital to total risk- weighted assets . . . . . . . . 13.0% 6.0% 4.0% Total capital to total risk- weighted assets . . . . . . . . 14.3% 7.3% 8.0%
The FDIC on June 15, 1995 issued an order terminating BKLA's cease and desist order issued March 10, 1994 (the "C&D Order") which had placed certain restrictions on BKLA. The C&D Order was terminated on June 15, 1995 principally due to the successful completion of the first phase of the Capital Infusion Transaction. In addition, the Federal Reserve Bank of San Francisco on September 22, 1995 notified Bancorp that it was terminating its Memorandum of Understanding entered into on April 11, 1995, which placed certain restrictions on Bancorp and BKLA. On December 22, 1994, the Superintendent delivered to BKLA an impairment order pursuant to California Financial Code Section 662 because BKLA's accumulated deficit was greater than 40% of "contributed capital." As of September 30, 1995, the capital impairment of BKLA was cured as the net adjusted accumulated deficit was less that 40%. Page 12 13 Management's Discussion and Analysis -- continued IV. Liquidity Management monitors its liquidity position continuously in relation to trends of loans and deposits, and relates the data to short and long term requirements. BKLA does not have lines of credit with other financial institutions. As a result, BKLA must rely on its own assets for liquidity. Liquid assets are defined to include federal funds sold, interest-earning deposits in other financial institutions, unpledged securities available for sale and cash and due from banks. The loan-to-deposit ratio at September 30, 1995 was 57% and at year end 1994 was 51%. To meet liquidity needs within one year, a portfolio of investment securities is maintained. Anticipated liquidity needs from either decline in deposits or growth in loans are met from the maturity of the investment securities. The investment portfolio is also available for either sale or sale under an agreement to repurchase for unexpected deposit declines or lending opportunities. For periods over a year the BKLA plans key indicators as follows; loans to deposits ratio not to exceed 75%, investment to deposits not to fall below 15%, federal funds sold to total assets not fall below 5%, and earning assets to fall assets not to fall below 85%. Adherence to these ratios will allow the Bank to provide the ability to fund asset growth, meet deposit withdrawals and fund reserve requirements. Additionally, the Bank plans improvement in the quality of its deposit base to reduce liquidity risk. The Bank has not and will not have brokered deposits. BKLA is working to meet the needs of the small depositor, retail deposits, to maintain a high ratio of core deposits. Core deposits are defined as the difference between total deposits and time certificates $100,000 and over. INTEREST RATE SENSITIVITY MANAGEMENT BKLA has adopted policies designed to minimize the exposure to interest rate fluctuations, and regularly measures the differences in the amounts of rate sensitive assets and rate sensitive liabilities over a variety of time periods. A gap for a specified period is positive (negative) when the amount of rate sensitive assets (liabilities) maturing or repricing within that period exceeds the amount of rate sensitive liabilities (assets) maturing or repricing within the same period. A positive gap will generally produce a higher net interest margin in a rising rate environment and a lower net interest margin in a declining rate environment. Conversely, a negative gap will generally produce a lower net interest margin in a rising rate environment and a higher net interest margin in a declining rate environment. The Bank's goal is to match interest variable assets to interest variable liabilities within one year. A 15% variance in either direction is considered to meet this goal. Additional variances are monitored and correction changes made for material variances. However, because interest rates for different asset and liability products offered by depository institutions respond in a different manner, both in terms of the responsiveness as well as the extent of responsiveness, to changes in the interest rate environment, the gap is only a general indicator of interest rate sensitivity. The table is on the following page Page 13 14 GAP Analysis
Non- 0 - 89 90-365 1 year to Over Interest % (dollars in thousands) Days Days 5 years 5 years Bearing Total Assets -------- -------- --------- ------- -------- -------- ------- ASSETS Federal funds sold 12,850 -- -- -- -- 12,850 15.9% Time certificates -- -- -- -- -- -- 0.0% Fixed rate securities 3,992 3,089 6,999 1,001 -- 15,081 18.7% Variable rate securities 1,195 1,796 626 -- -- 3,617 4.5% --------- -------- ------- ------- ------ --------- ------- Investments 18,037 4,885 7,625 1,001 -- 31,548 39.0% Loans, variable 35,034 35,034 43.4% Loans fixed 682 428 2,450 1,253 -- 4,813 6.0% Nonaccrual -- -- -- -- 23 23 0.0% --------- -------- ------- ------- ------ --------- ------- Loans 35,716 428 2,450 1,253 23 39,870 49.4% --------- -------- ------- ------- ------ --------- ------- Total earning assets 53,753 5,313 10,075 2,254 23 71,418 88.4% --------- -------- ------- ------- ------ --------- ------- Other assets -- -- -- -- -- 9,371 11.6% --------- -------- ------- ------- ------ --------- ------- Total 53,753 5,313 10,075 2,254 23 80,789 100.0% ========= ======== ======= ======= ====== ========= ======= LIABILITIES AND EQUITY CDs $100,000 or more 4,805 2,660 -- -- -- 7,465 9.2% CDs less than $100,000 4,288 3,991 253 -- -- 8,532 10.6% Money Market 12,474 -- -- -- -- 12,474 15.4% NOW 10,252 -- -- -- -- 10,252 12.7% Savings 8,120 -- -- -- -- 8,120 10.1% --------- -------- ------- ------- ------ --------- ------- Total deposits 39,939 6,651 253 -- -- 46,843 58.0% Repurchase agreements -- -- -- -- -- -- -- Capital Lease -- -- -- 1,835 -- 1,835 2.3% Non-interest bearing deposits -- -- -- -- 23,579 23,579 29.2% Other liabilities and equity -- -- -- -- 8,532 8,532 10.6% --------- -------- ------- ------- ------ --------- ------- Total 39,939 6,651 253 1,835 32,111 80,789 100.0% ========= ======== ======= ======= ====== ========= ======= GAP (Assets less liabilities) (13,814) 1,338 (9,822) (419) 32,088 Cumulative Gap (13,814) (12,476) (22,298) (22,717) 9,372 Percent of Assets (1) -17.1% -15.4% -27.6% -28.1% 11.6% Impact of .5% increase (2) 17 47 446 Cumulative Impact of .5% increase 17 64 510
(1) The Bank's goal is to match interest variable assets to interest variable liabilities within one year. A 15% variance in either direction is considered to meet this goal. (2) These figures shown are based on the assumption that every interest variable asset and every interest variable liability within in the period category will change rates at the same time and that the new rates will remain in effect throughout the time period shown. Page 14 15 BKLA BANCORP BALANCE SHEET
At September 30, At December 31, 1995 1994 ---------------- --------------- (dollars in thousands except share data) Unaudited Assets - ------ Cash and due from banks $ 5,250 $ 5,177 Federal funds sold 12,850 3,000 ------------- ------------- Total cash and cash equivalents 18,100 8,177 Securities held to maturity, at cost (approximate market value of -- 14,821 $14,667 in 1994) Securities held available for sale 18,698 15,781 Loans receivable 39,870 38,114 Less allowance for credit losses 1,486 1,633 ------------- ------------- Loans, net 38,384 36,481 Accrued interest receivable 542 685 Premises and equipment, net 2,570 2,608 Real estate owned 516 -- Other assets 1,978 1,954 ------------- ------------- Total assets $ 80,788 $ 80,507 ============= ============= Liabilities and Shareholders' Equity - ------------------------------------ Liabilities Deposits Demand, noninterest bearing $ 23,579 $ 25,128 Interest bearing Time certificates of deposit of $100,000 or more 7,465 7,422 Other 39,378 41,921 ------------- ------------- Total deposits 70,422 74,471 Capital lease obligation 1,835 1,830 Accrued interest payable and other liabilities 523 389 ------------- ------------- Total liabilities 72,780 76,690 ------------- ------------- Shareholders' equity Preferred stock; 25,000,000 shares; no shares issued and -- -- outstanding Common stock, no par value; authorized, 75,000,000 shares: issued and outstanding, 5,987,125 shares at September 30, 1995 and 1,251,565 at December 31, 1994 14,521 11,078 Accumulated deficit (6,500) (6,788) Net unrealized holding loss on securities available for sale (13) (473) ------------- ------------- Total shareholders' equity 8,008 3,817 ------------- ------------- Total liabilities and shareholders' equity $ 80,788 $ 80,507 ============= ============
The accompanying notes are an integral part of these statements. Page 15 16 BKLA BANCORP STATEMENTS OF OPERATIONS
For the Nine Months For the Three Months Ended September 30, Ended September 30, ---------------------------- ---------------------------- 1995 1994 1995 1994 ------------- ------------- ------------- ------------- (dollars in thousands except share data) Unaudited Unaudited Unaudited Unaudited Interest income Loans receivable $ 3,282 $ 3,073 $ 1,162 $ 1,019 Investment securities -- -- -- 346 Securities held to maturity 333 262 -- -- Securities available for sale 828 647 325 -- Federal funds sold 205 281 118 112 Deposits with financial institutions 1 -- -- -- Total interest income 4,649 4,263 1,605 1,477 ------------ ------------- ------------- ------------- Interest expense Deposit accounts 979 1,030 365 335 Short-term borrowed funds 51 -- -- -- Capital lease obligation 195 192 66 64 ------------ ------------- ------------- ------------- Total interest expense 1,225 1,222 431 399 ------------ ------------- ------------- ------------- Net interest income before provision (credit) for credit losses 3,424 3,041 1,174 1,078 Provision (credit) for credit los ses (260) -- (78) -- ------------ ------------- ------------- ------------- Net interest income after provision (credit) for credit losses 3,684 3,040 1,252 1,078 Non-interest income Service charges and fees 537 746 184 219 Gain (loss) on sale of securities, net (33) -- (32) -- Gain on sale of loans, net 118 -- 118 -- ------------ ------------- ------------- ------------- Total non-interest income 622 746 270 219 Non-interest expense Employee compensation and benefits 2,052 2,000 574 609 Occupancy 446 599 156 197 Furniture and equipment 237 313 67 99 Professional services 444 725 166 296 Other 837 936 275 327 ------------ ------------- ------------- ------------- Total non-interest expense 4,016 4,572 1,238 1,528 ------------ ------------- ------------- ------------- Income (loss) before income tax expense 290 (785) 284 (231) Income tax expense 2 2 -- 2 ------------ ------------- ------------- ------------- Net income (loss) $ 288 $ (787) $ 284 $ (233) ============ ============= ============= ============= Net income (loss) per common share $ 0.05 $ (0.63) $ 0.04 $ (0.19) ============ ============= ============= ============= Weighted average common shares outstanding 5,641,462 1,251,565 7,159,760 1,251,565 ============ ============= ============= =============
The accompanying notes are an integral part of these statements. Page 16 17 BKLA BANCORP STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY FOR THE YEAR ENDED DECEMBER 31, 1994, AND THE NINE MONTHS ENDED SEPTEMBER 30, 1995
Net unrealized Common Stock holding loss Total ------------------------- Accumulated on securities Shareholders' Shares Amount Deficit available for sale Equity --------- ------- ----------- ------------------ ------------ Balance, December 31, 1993 1,251,565 $11,078 $(5,576) $ -- $ 5,502 Net change in unrealized loss on securities available for sale -- -- -- (473) (473) Net loss -- -- (1,212) -- (1,212) --------- ------- ------- ---- ------- Balance, December 31, 1994 1,251,565 11,078 (6,788) (473) 3,817 Net change in unrealized loss on securities available for sale -- -- -- 460 460 Issuance of common stock 4,735,560 3,443 -- -- 3,443 Net income -- -- 288 -- 288 --------- ------- ------- ------ ------- Balance, September 30, 1995 (Unaudited) 5,987,125 $14,521 $(6,500) $ (13) $ 8,008 ========= ======= ======= ====== =======
The accompanying notes are an integral part of this statement. Page 17 18 BKLA BANCORP STATEMENTS OF CASH FLOWS
For the Nine Months Ended For the Year September 30, Ended December 1995 31, 1994 ------------- -------------- (dollars in thousands) Unaudited Cash flows from operating activities: Interest received $ 4,921 $ 6,123 Fees and commissions received 537 923 Interest paid (1,262) (1,634) Cash paid to suppliers and employees (3,632) (5,363) Income taxes (paid) refunded (2) (2) -------- -------- Net cash provided by (used in) operating activities 562 47 Cash flows from investing activities: Proceeds from maturities and pay downs of securities held to maturity 5,000 11,000 Purchases of securities held to maturity -- (16,740) Proceeds from maturities and pay downs of securities available for sale 3,780 2,764 Proceeds from sale of securities available for sale 4,623 -- Purchases of securities available for sale (976) -- Net (increase) decrease in loans receivable (2,272) 11,802 Acquisition of premises and equipment (190) (310) Proceeds for the sale of premises and equipment and other real estate owned 2 -- -------- -------- Net cash provided by investing activities 9,967 8,516 Cash flows from financing activities: Proceeds from the issuance of common stock 3,443 -- Net decrease in deposits (4,049) (16,917) -------- -------- Net cash used in financing activities (606) (16,917) Net increase (decrease) in cash and cash 9,923 (8,354) equivalents Cash and cash equivalents, beginning of period 8,177 16,531 -------- -------- Cash and cash equivalents, end of period $ 18,100 $ 8,177 ======== ========
The accompanying notes are an integral part of these statements. Page 18 19 BKLA BANCORP STATEMENTS OF CASH FLOWS
For the Nine Months Ended September 30, For the Year Ended 1995 December 31, 1994 ------------- ------------------ (dollars in thousands) Unaudited Reconciliation of net income (loss) to net cash provided by operating activities: Net income (loss) $ 288 $ (1,212) Adjustments for noncash items: Depreciation and amortization 432 942 Provisions (credit) for credit losses (260) -- (Decrease) increase in deferred loan origination fees, net 6 (34) Net realized losses (gains) on securities 33 -- Net realized (gains) on sale of loans (118) -- Loss on disposal of premises and equipment 4 22 (Gain) loss or other real estate owned -- -- Decrease (increase) in accrued interest receivable 143 22 (Increase) decrease in other assets (100) 176 (Decrease) increase in interest payable and other liabilities 134 131 ----------- ---------- Net cash provided by (used in) by operating $ 562 $ 47 =========== ========== Supplemental disclosure of noncash transactions: Transfer of loans to real estate owned through foreclosure and in-substance foreclosure, net $ 516 $ -- =========== ========== Transfer of securities from held to maturity to available for sale $ 9,885 $ -- =========== ==========
The accompanying notes are an integral part of these statements. Page 19 20 BKLA BANCORP NOTES TO FINANCIAL STATEMENTS NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994 (UNAUDITED) AND YEAR ENDED DECEMBER 31, 1994, NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 1. Basis of Presentation On October 23, 1995, the Bank of Los Angeles (the "Bank") merged with its parent corporation BKLA Bancorp ("BKLA"), effectively eliminating the bank holding company. The financial statements include the accounts of BKLA Bancorp. All intercompany accounts and transactions have been eliminated. The merger resulted in one share of Bank stock being issued for very five shares of BKLA Bancorp stock. 2. Cash and Cash Equivalents Cash and cash equivalents consist of cash and investments with terms to maturity at acquisition of three months or less, including federal funds sold. 3. Investment Securities The Bank classifies its investment securities in two categories: securities available for sale and securities held to maturity. Securities available for sale are stated at fair value, with net unrealized gains and losses reported as a separate component of shareholders' equity. Securities held to maturity are stated at cost, adjusted for amortization of premiums and accretion of discounts which are recognized in interest income using a method which approximates the interest method over the period to maturity. The amortized cost or carrying value of the specific security sold is used to compute the gain or loss on the sale. In May 1993, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 115, "Accounting for Certain Investments in Debt and Equity Securities" which addresses the accounting and reporting for investments in equity securities that have readily determinable fair values and all investments in debt securities. Under this statement, investments will be classified into three categories, as follows: Securities held to maturity - Debt securities that the Bank has the positive intent and ability to hold to maturity. These securities are to be reported at amortized cost. Trading Securities - Debt and equity securities that are bought and held for the purpose of selling them in the near term. These securities are to be reported at fair values, with unrealized gains and losses included in earnings. Securities Available for Sale - Debt and equity securities not classified as either held-to-maturity or trading securities. These securities are to be reported at fair value, with unrealized gains and losses excluded from earnings and reported as a separate component of shareholders' equity (net of tax effects). The Bank adopted this statement on January 1, 1994 at which time the impact was immaterial. the ongoing impact of this new accounting method will depend on changes in the market values of the Bank's securities classified available for sale. For example, significant increase in market interest rates could depress the values of the Bank's investments and result in the recording of direct charges to equity (for securities available for sale). Prior to January 1, 1994, investment securities that management intended and was able to hold to maturity were stated at cost, net of discounts or premiums accreted or amortized using a method not materially different from the level yield method. The carrying amount of such securities would be adjusted if a permanent impairment of their market value occurred. Securities held for sale were stated at the lower of cost or market value. Realized gains and losses were determined on a specific identification basis. Page 20 21 NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued 3. Investment Securities, Continued In March of 1995, Investors Banking Corp., a holding company, invested $3,549,000 into Bank of Los Angeles becoming the owner of approximately 79% of the Bank. The new management determined that the securities held to maturity portfolio could restrict the Bank's ability to manage its interest rate risk and profitability. As a result, the securities held to maturity portfolio was reclassified to securities available for sale. The transfer from held-to-maturity to available-for-sale occurred on June 1, 1995 and the unamortized cost of the portfolio was $9,885,000, market value was $9,965,313 with an unrealized gain of $70,000. 4. Loans Receivable Interest on loans is credited to income as earned and is accrued only if deemed collectible. Nonrefundable fees, net of incremental costs, associated with the origination or acquisition of loans are deferred and recognized as an adjustment of the loan yield over the life of the loan in a manner that approximates the level yield method. Other loan fees and charges, representing service costs for the prepayment of loans, for delinquent payments or for miscellaneous loan services are recorded as income when collected. 5. Allowance for Credit Losses In May 1993, the FASB issued SFAS No. 114, "Accounting by Creditors for Impairment of a Loan." This statement amends SFAS No. 5, "Accounting for Contingencies," and SFAS No. 15, "Accounting by Debtors and Creditors for Troubled Debt Restructurings." This statement prescribes that a loan is impaired when it is probable that a creditor will be unable to collect all amounts due (principal and interest) according to the contractual terms of the loan agreement. Measurement of the impairment can be based on either the discounted future cash flows of the impaired loan or the fair market value of the collateral for a collateral-dependent loan. Creditors may select the measurement method on a loan-by-loan basis, except that collateral-dependent loans for which foreclosure is probable must be measured at the fair value of the collateral. Additionally, the statement prescribes measuring impairment of a restructured loan by discounting the total expected future cash flows using the loan's effective rate of interest in the original loan agreement. Finally, the impact of initially applying the statement is reported as a part of the provision for credit losses in the income statement. The Bank adopted SFAS No. 114 as of January 1, 1995 with no material impact on the provision for credit losses in the income statement. The allowance for credit losses is maintained at a level believed adequate by management to absorb potential losses in the loan portfolio. The allowance is increased by provisions for credit losses charged against operations and recoveries of previously charged off loans. Management believes that, as of September 30, 1995, and December 31, 1994 the allowance for credit losses is adequate to provide for losses inherent in the loan portfolio. However, the allowance is an estimate which is inherently uncertain and depends on the outcome of future events. Management's estimates are based on previous loan loss experience; volume, growth and composition of the loan portfolio; the value of collateral; and current economic conditions. The Bank's lending is concentrated in real estate secured and unsecured loans in Southern California, which has experienced adverse economic conditions and declining real estate values. These conditions have adversely affected many borrowers' ability to repay loans. Additional declines in the economy would result in increasing loan losses that cannot be reasonably predicted. Such losses would also result in unanticipated erosion of the Bank's capital. Page 21 22 NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued 6. Premises and Equipment Premises and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation on furniture, fixtures and equipment is computed using the straight-line method over the estimated useful lives of the related assets, which range from three to ten years. Capitalized leases are amortized over the term of the lease on the straight-line method. Leasehold improvements are amortized over the term of the lease or the estimated useful lives of the improvements, whichever is shorter, and computed on the straight-line method. 7. Other Real Estate Owned The Bank records other real estate owned at the fair value of the real estate less management's estimates of selling costs as of the date of foreclosure or in-substance foreclosure. Loan balances in excess of fair value of real estate acquired at the date of foreclosure or in-substance foreclosure are charged to the allowance for credit losses. An allowance is recorded against the foreclosed assets for any subsequent declines in fair value. Any subsequent operating expenses or income, reduction in fair value, and gains or losses on disposition of such properties are charged to current operations. 8. Income Taxes Deferred income taxes are provided for temporary differences in the recognition of items of income and expense reported in different accounting periods for tax and financial reporting purposes. The Bank adopted SFAS No. 109 "Accounting for Income Taxes" as of January 1, 1993. This statement requires an asset and liability approach for determining the amount of income taxes for financial reporting. A current or deferred tax liability or asset is measured based on the amount of taxes calculated at the then-effective tax rates payable or refundable currently or in future years. This statement also requires that a valuation allowance be recorded if it is more likely than not that some or any of the deferred tax asset will not be realized. As a result of this adoption, no cumulative effect adjustment was recorded in 1993. 9. Income and (loss) per Share Income per share is computed on the basis of the weighted average number of shares outstanding during the period, plus shares issuable upon the assumed excercise of stock warrants and options outstanding as computed using the "treasury stock" method. Under this method, weighted average number of shares outstanding are computed assuming the stock options and warrants were exercised at the beginning of the period and the proceeds obtained were used to purchase outstanding common stock at the average market price during the period. The method is limited to the lesser of shares to be purchased or 20% of outstanding shares. Due to the antidilutive effect, stock options and warrants are not considered common stock equivalents in computing loss per share at December 31, 1994, 1993 and 1992. The weighted average number of shares outstanding was 5,641,462 and ,251,565 for the nine months September 30, 1995 and 1994, respectively and 1,251,565 for the year ended December 31, 1994. Page 22 23 Other Information - ----------------- Item 2: Changes in securities None Item 3: Defaults upon senior securities None Item 4: Submission of matters to a vote of security holders None Item 5: Other information not previously reported on form 8-K None Item 6: Exhibits and reports on form 8-K a. Exhibits None b. Reports on Form 8-K. April 13, 1995 -- Changes in Control of Registrant April 27, 1995 -- Resignation of a Registrant's Director Page 23 24 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. BKLA BANCORP Date: November 8, 1995 /s/ M.J. Buford -------------------------------- M.J. Burford Chairman of the Board and Chief Executive Officer Date: November 8, 1995 /s/ Mark W. Bidwell -------------------------------- Mark W. Bidwell Vice President Controller Page 24 EX-27 2 EXHIBIT 27 - FINANCIAL DATA SCHEDULE
9 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEET AT SEPTEMBER 30, 1995, AND THE STATEMENTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 3-MOS DEC-31-1995 SEP-30-1995 5,250 0 12,850 0 18,698 0 0 39,870 1,486 80,788 70,422 0 523 0 14,521 0 0 1,832 80,788 3,282 1,161 206 4,649 0 1,225 3,424 (260) (33) 4,016 290 290 0 0 288 0.05 0.05 9.00 23 200 0 0 1,633 147 260 1,486 1,486 0 0
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