-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, l8tL0F1o6HQkV/dJ7eVA3zaBnMlY4xnyg7R3xwgW3c3P2A4iR1o+JxaLOQtCutES EtPnmobQNnt9B39L15QnhQ== 0000737269-95-000009.txt : 19950516 0000737269-95-000009.hdr.sgml : 19950516 ACCESSION NUMBER: 0000737269-95-000009 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950331 FILED AS OF DATE: 19950515 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BURLINGAME BANCORP CENTRAL INDEX KEY: 0000737269 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 942921417 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-18440 FILM NUMBER: 95538464 BUSINESS ADDRESS: STREET 1: 350 PRIMROSE RD STE 400 CITY: BURLINGAME STATE: CA ZIP: 94010 BUSINESS PHONE: 4153482500 MAIL ADDRESS: STREET 2: 350 PRIMROSE ROAD CITY: BURLINGAME STATE: CA ZIP: 94010 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1995 OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 0-18440 BURLINGAME BANCORP (Exact name of registrant as specified in its charter) California 94-2921417 (State or other jurisdiction of (I.R.S. Employer Incorporation or organization) Identification No.) 350 Primrose Road Burlingame, California (Address of principal executive offices) 94010 (Zip Code) (415) 348-2500 (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 Number of shares of common stock outstanding at May 12, 1995 is 576,974. PART I - FINANCIAL INFORMATION ITEM 1 - Financial Statements The information required by Rule 10-01 of Regulation S-X is attached hereto as Exhibit A. ITEM 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations The sole business operation of Burlingame Bancorp (the "Company") is conducted through its wholly owned subsidiary, Burlingame Bank & Trust Co. (the "Bank"). This discussion, therefore, although presented on a consolidated basis, analyzes primarily the financial condition and results of operations of the Bank for the 3 month period ended March 31, 1995. Changes in Financial Condition During the three month period ended March 31, 1995, deposits increased $4.1 million or 7.0% to $62.3 million. During the same period, loans and loans held for sale decreased $.5 million or 1.4% to $39.6 million, primarily as a result of a partial repayment of a non-performing loan. Investment securities decreased $3.2 million or 16.3%, to $16.4 million. Excess liquidity during the period was invested in federal funds and money market funds. During the three month period ending March 31, 1995, non- performing assets decreased to $1.7 million (2.4% of total assets), which compares with $2.1 million (3.3% of total assets) at December 31, 1994. The Bank's allowance for credit losses at March 31, 1995 was 4.1% of total loans compared with 4.0% at December 31, 1994. Earnings Summary Net income for the quarter ended March 31, 1995 was $22,000, or $0.04 per common and common equivalent share, compared with net income of $ 6,000, or $0.01 per share in the same quarter a year ago. Net Interest Income Total interest income increased $215,000 or 19.2% for the quarter ended March 31, 1995, as compared to the prior year. During the same period, interest expense increased $114,000 or 37.1%. Net interest income for the quarter ended March 31 was $916,000 in 1995 and $815,000 in 1994. Average loans as a percentage of average earning assets was 65.4% during the quarter ended March 31, 1995, compared to 63.5% a year earlier. The average balance of lower yielding other earning assets as a percentage of average total earning assets was 34.6% during the quarter ended March 31, 1995, compared to 36.5% a year earlier. Provision for Credit Losses The Bank maintains its allowance for credit losses at a level considered appropriate by management to provide for known and inherent risks in the loan portfolio. This consideration includes an evaluation of various factors affecting the collectability of loans, including current and projected economic conditions, past credit experience and a periodic review of the Bank's loan portfolio. Because of the decrease in non-performing assets and the general improvement in asset quality, the Bank recorded no additional provision to the allowance for credit losses for the three month period ended March 31, 1995 or 1994. Loans charged off during the three month period totalled $0 in 1995 and $243,000 in 1994. Recoveries in the same period were $21,000 in 1995 and $89,000 in 1994. On January 1, 1995, the Company adopted SFAS No. 114, "Accounting by Creditors for Impairment of a Loan" and SFAS No. 118, "Accounting by Creditors for Impairment of a Loan - Income Recognition and Disclosure". The effect of adoption on the Company's financial statements was not material. Other Income Other Income consists of gain on sale of assets, service fees and other fees related to deposit accounts, escrow fees, letter of credit fees, referral fees and safe deposit box rentals. In the quarter ended March 31, 1995, income from these sources was $76,000, a decrease of $84,000 from the same period in 1994. The decrease was attributable primarily to the Bank's decision during the quarter ended March 31, 1995, not to sell the guaranteed portion of certain SBA loans. Other Expenses Other Expenses decreased $12,000, or 1.2%, to $954,000 for the quarter ended March 31, 1995, compared to the same period in 1994. The decrease was due in part to reduced personnel costs. During the quarter ended March 31, 1995, the Bank had 33 full- time officers and employees and 2 part-time officers and employees for a total of 34 full-time equivalents, compared to 36 full-time equivalents during the same quarter a year earlier. The reduction in personnel costs was partially offset by increased expenses due to collection efforts for certain non- performing assets. Capital Resources Management seeks to maintain adequate capital to support anticipated asset growth and credit risks and to ensure that the Company meets all regulatory capital requirements. The Bank is subject to requirements issued by the FDIC including the maintenance of a minimum risk-based capital ratio of 9.0% and a minimum tier 1 leverage ratio of 6.5%. As of March 31, 1995, the Bank was in compliance, with a risk-based capital ratio of 12.1% and a leverage ratio of 8.4%. Future growth and earnings retention, as currently projected by management, are expected to provide for the maintenance of capital ratios in conformance with the requirements. Income Taxes The provision for income taxes was $16,000 for the quarter ended March 31, 1995, compared to $3,000 in the same quarter a year earlier. The provision is classified as a current tax liability for interim reporting purposes. The effective tax rate was 42% for the quarter ended March 31, 1995, compared to 33% for the same quarter in 1994. Liquidity The Bank manages its liquidity to ensure that sufficient funds are available to meet loan commitments and deposit fluctuations. Primary sources of liquidity include cash and deposits due from banks, unpledged short-term U.S. Government securities, adjustable rate government securities funds, money market funds, and federal funds sold. The Bank's primary liquidity ratio, which is the ratio of liquid assets to total deposits, was 34% at March 31, 1995, and 27% at December 31, 1994. Other Matters As of March 31, 1995, management of the Company and Bank believe that they remain in full compliance with the requirements of all regulatory agreements entered into with the Federal Reserve Bank and the Federal Deposit Insurance Corporation. PART II - OTHER INFORMATION ITEM 1 - Legal Proceedings None 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 None ITEM 6 - Exhibits and Reports on Form 8-K None There are no other applicable items. >PAGE> 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. BURLINGAME BANCORP Registrant Date: May 12, 1995 Theodore H. Kruttschnitt Chairman and C.E.O. (Principal Executive Officer) Date: May 12, 1995 Susann Trevena Chief Accounting Officer Exhibit A Part I - Financial Statements Burlingame Bancorp and Subsidiary Consolidated Balance Sheets
March 31 1995 December 31 (Unaudited) 1994 ------------ ------------ ASSETS Cash and due from banks $4,022,000 $3,512,000 Federal funds sold 7,550,000 400,000 Short-term investments 0 0 ------------ ----------- Total cash and equivalents 11,572,000 3,912,000 Investment securities: Held to Maturity 14,345,000 17,609,000 Available for Sale 2,096,000 2,030,000 Loans Held for Sale 1,714,000 1,098,000 Loans 37,913,000 39,078,000 Allowance for credit losses (1,626,000) (1,605,000) Premises and equipment, net 1,061,000 1,132,000 Other real estate owned 407,000 32,000 Accrued interest receivable and other assets 1,590,000 1,395,000 ------------ ------------ Total Assets $69,072,000 $64,681,000 ============ ============ LIABILITIES & SHAREHOLDERS' EQUITY Deposits: Interest-bearing $49,833,000 $46,151,000 Noninterest-bearing 12,456,000 12,058,000 ------------ ----------- Total deposits 62,289,000 58,209,000 Accrued interest payable and other liabilities 802,000 537,000 ------------ ----------- Total Liabilities 63,091,000 58,746,000 ------------ ----------- Shareholders' Equity Preferred stock - no par value Authorized 20,000,000 shares; Issued, none Common stock - no par value Authorized 20,000,000 shares; Issued, 576,974 shares 4,567,000 4,567,000 Unrealized loss on investment securities available for sale (77,000) (101,000) Retained earnings 1,491,000 1,469,000 ------------ ----------- Total Shareholders' Equity 5,981,000 5,935,000 ------------ ----------- Total Liabilities and Shareholders' Equity $69,072,000 $64,681,000 ============ ===========
See notes to consolidated financial statements Burlingame Bancorp and Subsidiary Consolidated Statements of Income (Unaudited)
For the Three Months Ended March 31, 1995 1994 ------------ ----------- Interest Income: Loans (including fees) $1,012,000 $905,000 Federal funds sold 269,000 62,000 Investment securities 56,000 155,000 ------------ ----------- Total Interest Income 1,337,000 1,122,000 Interest Expense on Deposits 421,000 307,000 ------------ ----------- Net Interest Income 916,000 815,000 Provision for credit losses 0 0 ------------ ---------- Net Interest Income after provision for credit losses 916,000 815,000 Other Income 76,000 160,000 Other Expenses: Salaries & benefits 469,000 522,000 Occupancy 60,000 67,000 Furniture & equipment 77,000 69,000 Data processing 31,000 35,000 Professional services 109,000 92,000 Other 208,000 181,000 ------------ ----------- Total Other Expenses 954,000 966,000 ------------ ----------- Income before income taxes 38,000 9,000 Income taxes 16,000 3,000 ------------ ----------- Net Income $22,000 $6,000 ============ =========== Income per common share and common share equivalent $0.04 $0.01 ============ ===========
See notes to consolidated financial statements. Burlingame Bancorp and Subsidiary Consolidated Statements of Cash Flows (Unaudited)
For the Three Months Ended March 31, 1995 1994 ------------ ------------ OPERATING ACTIVITIES: Net Income 22,000 $6,000 Reconciliation to net cash provided by (used in) operating activities: Depreciation and amortization of premises and equipment 81,000 77,000 Amortization deferred loan fees (51,000) (27,000) Amortization of investment security premiums (discounts) (38,000) 19,000 Origination of loans held for sale (1,962,000) (1,361,000) Sales of loans held for sale 262,000 1,361,000 (Increase) decrease in interest receivable and other assets (206,000) 91,000 Increase (decrease) in interest payable and other liabilities 265,000 (82,000) ------------ ----------- (1,627,000) 84,000 ------------ ----------- INVESTING ACTIVITIES: Activities in securities held-to-maturity: Purchases (198,000) (8,533,000) Maturities 3,500,000 4,100,000 Activities in securities available-for- sale: Purchases (31,000) 0 Net loan originations, collections and principal repayments 1,946,000 2,592,000 Purchases of premises and equipment (10,000) (48,000) ------------ ----------- 5,207,000 (1,889,000) ------------ ----------- FINANCING ACTIVITIES: Net increase in interest-bearing deposits 3,682,000 1,305,000 Net increase (decrease) in noninterest- bearing deposits 398,000 (882,000) ------------ ----------- 4,080,000 423,000 ------------ ----------- NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS 7,660,000 (1,382,000) CASH AND EQUIVALENTS: Beginning of period 3,912,000 17,788,000 ------------ ----------- End of period $11,572,000 $16,406,000 ============ =========== OTHER CASH FLOW INFORMATION: Interest paid $418,000 $313,000 ------------ ----------- Taxes paid $19,000 $0 ------------ -----------
See notes to consolidated financial statements. Burlingame Bancorp and Subsidiary Notes to Consolidated Financial Statements March 31, 1995 (Unaudited) Note 1 - Basis of Presentation In the opinion of Management, the unaudited interim consolidated financial statements contain all adjustments of a normal recurring nature, which are necessary to present fairly the financial condition of Burlingame Bancorp and Subsidiary at March 31, 1995 and the results of operations for the three months then ended. Certain information and footnote disclosures presented in the Company's annual consolidated financial statements are not included in these interim financial statements. Accordingly, the accompanying unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's 1994 Annual Report on Form 10-K. The results of operations for the three months ended March 31, 1995 are not necessarily indicative of the operating results through December 31, 1995. Note 2 - New Accounting Policies On January 1, 1995, the Company adopted SFAS No. 114, "Accounting by Creditors for Impairment of a Loan" and SFAS No. 118, "Accounting by Creditors for Impairment of a Loan - Income Recognition and Disclosure". These statements address the accounting and reporting by creditors for impairment of certain loans. A loan is impaired when, based upon current information and events, it is probable that a creditor will be unable to collect all amounts due according to the contractual terms of the loan agreement. These statements are applicable to all loans, uncollaterialized as well as collateralized, except large groups of smaller-balance homogeneous loans that are collectively evaluated for impairment such as consumer installment loans and loans held for sale which are measured at fair value or at the lower of cost or fair value. Impairment is measured based on the present value of expected future cash flows discounted at the loan's effective interest rate, except that as a practical expedient, the Company measures impairment based on a loan's observable market price or the fair value of the collateral if the loan is collateral dependent. Loans are measured for impairment as part of the Company's normal internal asset review process. Interest income is recognized on impaired loans in a manner similar to that of all loans. It is the Company's policy to place loans that are delinquent 90 days or more as to principal or interest on a nonaccrual of interest basis unless secured and in the process of collection, and to reverse from current income accrued but uncollected interest. Cash payments subsequently received on nonaccrual loans are recognized as income only where the future collection of principal is considered by management to be probable. At March 31, 1995, the Company's total recorded investment in the impaired loans was $1,445,000 for which there is a related allowance for credit losses of $357,000 determined in accordance with these Statements. The average recorded investment in the impaired loans during the three months ended March 31, 1995 was $1,445,000. The related amount of interest income recognized during the period that such loans were impaired was $1,000 and the amount of interest income recognized using a cash-basis method of accounting during the time within the period that the loans were impaired was $1,000. Note 3 - Consolidation The consolidated financial statements include the accounts of Burlingame Bancorp and its wholly-owned subsidiary, Burlingame Bank & Trust Co and its wholly-owned subsidiary, Burlingame Development Corporation. All material intercompany accounts and transactions have been eliminated in consolidation. Note 4 - Commitments The Bank has outstanding standby letters of credit of $480,000 at March 31, 1995. Note 5 - Net Income Per Common Share Net income per share is calculated by using the weighted average common shares outstanding plus common stock equivalents resulting from stock options. The difference between primary and fully diluted net income per share is not significant. The weighted average number of common and common equivalent shares used in computing the net income per common share for the periods ending March 31, 1995 and 1994 was 576,974. EX-27 2
9 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM UNAUDITED CONSOLIDATED BALANCE SHEETS, CONSOLIDATED STATEMENTS OF INCOME AND OTHER INTERNALLY GENERATED REPORTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 0000737269 BURLINGAME BANCORP 3-MOS 3-MOS DEC-31-1995 DEC-31-1994 MAR-31-1995 MAR-31-1994 4,022,000 5,184,000 0 500,000 7,550,000 7,200,000 0 0 2,096,000 6,082,000 14,345,000 13,903,000 14,208,000 13,796,000 39,627,000 42,094,000 (1,626,000) (1,743,000) 69,072,000 75,936,000 62,289,000 69,708,000 0 0 802,000 377,000 0 0 4,567,000 4,567,000 0 0 0 0 1,414,000 1,284,000 5,981,000 5,851,000 1,012,000 905,000 325,000 217,000 0 0 1,337,000 1,122,000 421,000 307,000 0 0 916,000 815,000 0 0 0 0 954,000 966,000 38,000 9,000 38,000 9,000 0 0 0 0 22,000 6,000 $0.04 $.01 $0.04 $.01 9.10 8.36 1,072,000 2,385,000 191,000 0 0 0 0 0 1,605,000 1,749,000 0 9,000 21,000 3,000 1,626,000 1,743,000 1,241,000 1,476,000 0 0 385,000 267,000
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