0000892569-95-000435.txt : 19950821
0000892569-95-000435.hdr.sgml : 19950821
ACCESSION NUMBER: 0000892569-95-000435
CONFORMED SUBMISSION TYPE: 8-K/A
PUBLIC DOCUMENT COUNT: 1
CONFORMED PERIOD OF REPORT: 19940826
ITEM INFORMATION: Financial statements and exhibits
FILED AS OF DATE: 19950818
SROS: NONE
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: COMBANCORP
CENTRAL INDEX KEY: 0000741316
STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022]
IRS NUMBER: 953737171
STATE OF INCORPORATION: CA
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 8-K/A
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-15984
FILM NUMBER: 95565232
BUSINESS ADDRESS:
STREET 1: 6001 E WASHINGTON BLVD
CITY: CITY OF COMMERCE
STATE: CA
ZIP: 90040
BUSINESS PHONE: 2137248800
MAIL ADDRESS:
STREET 1: PO BOX 911070
STREET 2: 6001 E WASHINGTON BLVD
CITY: CITY OF COMMERCE
STATE: CA
ZIP: 90091
8-K/A
1
COMBANCORP FORM 8-K/A AMENDMENT NO. 1
1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
AMENDMENT NO. 1
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): August 26, 1994
----------------------------
COMBANCORP
-----------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
California 0-15984 95-3737171
-----------------------------------------------------------------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
6001 E. Washington Boulevard, City of Commerce, California 90040
-----------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (213) 724-8800
-------------------------
Inapplicable
-----------------------------------------------------------------------------
(Former name or former address, if changed since last report)
2
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements of Business Acquired
Not applicable. The Company believes that the assets acquired and
liabilities assumed do not constitute a business which has continuity
for which historical financial statements would be relevant.
(b) Pro Forma Financial Information
Pro forma financial information reflecting the assets acquired and
liabilities assumed as of the date of acquisition of August 26, 1994
have been included, which give effect to the transaction as if it
occurred on June 30, 1994. The Company does not have access to any
income statement information related to the assets acquired and
liabilities assumed. Consequently, only unaudited pro forma condensed
balance sheet information is presented together with notes to
unaudited pro forma condensed financial statements.
2
3
COMBANCORP AND SUBSIDIARY
UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
The unaudited pro forma balance sheet reflects the August 26, 1994 purchase and
assumption of certain assets and liabilities of Capital Bank by Commerce
National Bank, a wholly owned subsidiary of COMBANCORP, as part of a consortium
with Landmark Bank, pursuant to an Insured Deposit Purchase and Assumption
Agreement with the Federal Deposit Insurance Corporation. The unaudited pro
forma balance sheet presents the balance sheet as if the transaction occurred
on June 30, 1994, the date of the Company's most recent consolidated balance
sheet, as filed as part of Form 10-Q.
A further description of the transaction follows the unaudited pro forma
condensed balance sheet.
The premium paid for this transaction of $185,000, including expenses, has been
reflected in the pro forma adjustments column.
3
4
COMBANCORP AND SUBSIDIARY
UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
(IN THOUSANDS OF DOLLARS)
Assets
COMBANCORP Acquired and
June 30, 1994 Liabilities Pro Forma
ASSETS (Historical) Assumed Adjustments Pro Forma
-----------------------------------------------------------------------------------------------------------
Cash and due from banks - demand $ 3,888 $17,312 $ 1) (185) $21,015
Federal funds sold 5,440 -- -- 5,440
-------------------------------------------------------------------
CASH AND CASH EQUIVALENTS 9,328 17,312 (185) 26,455
Interest bearing deposits with
financial institutions 7,709 -- -- 7,709
Securities held to maturity 120 -- -- 120
Securities available for sale 13,886 -- -- 13,886
Loans 21,086 5,750 26,836
Less:
Deferred loan fees and costs (82) -- -- (82)
Unearned discount on acquired
loans (41) (526) -- (567)
Allowance for loan losses (565) -- -- (565)
-------------------------------------------------------------------
NET LOANS 20,398 5,224 -- 25,622
-------------------------------------------------------------------
Premises and equipment, net 1,361 -- -- 1,361
Accrued interest receivable and
other assets 707 -- 1) 185 892
-------------------------------------------------------------------
TOTAL ASSETS $53,509 $22,536 $ -- $76,045
===================================================================
See Notes to Unaudited Pro Forma Condensed Balance Sheet.
4
5
Assets
Acquired
and
COMBANCORP Liabilities Pro Forma
LIABILITIES AND SHAREHOLDERS' EQUITY June 30, 1994 Assumed Adjustments Pro Forma
---------------------------------------------------------------------------------------------------------
Deposits
Demand - noninterest bearing $15,992 $ 8,201 $ -- $24,193
Savings and other interest
bearing accounts 22,095 8,614 -- 30,709
Time, $100,000 and over 3,573 2,707 -- 6,280
Other time 5,941 2,960 -- 8,901
-----------------------------------------------------------------
TOTAL DEPOSITS 47,601 22,482 -- 70,083
Accrued interest payable and
other liabilities 220 54 -- 274
-----------------------------------------------------------------
TOTAL LIABILITIES 47,821 22,536 -- 70,357
-----------------------------------------------------------------
Shareholders' Equity
Common stock 4,453 -- -- 4,453
Retained earnings 1,252 -- -- 1,252
Unrealized (loss) on securities
available for sale, net (17) -- -- (17)
-----------------------------------------------------------------
TOTAL SHAREHOLDERS' EQUITY 5,688 -- -- 5,688
-----------------------------------------------------------------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $53,509 $22,536 $ -- $76,045
=================================================================
5
6
COMBANCORP AND SUBSIDIARY
NOTES TO UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENTS
DESCRIPTION OF TRANSACTION
On August 26, 1994, Commerce National Bank (the Bank), a wholly owned
subsidiary of COMBANCORP, as part of a consortium with Landmark Bank, entered
into an Insured Deposit Purchase and Assumption Agreement (Agreement) with the
Federal Deposit Insurance Corporation (FDIC) for the purchase and assumption of
certain assets and liabilities of Capital Bank. The Bank purchased $674,000 of
assets consisting of cash and assumed $22,536,000 of deposit liabilities,
principally insured, and accrued interest of the Downey branch for a premium of
$185,000, including expenses. In addition, the Bank obtained a month-to-month
lease on the Downey branch facility of Capital Bank, with an option to
purchase, and hired ten former employees of Capital Bank to staff the existing
facility.
As part of the "bid process" on Capital Bank, the Bank evaluated various loan
pools available for sale. The Bank elected to purchase approximately
$5,224,000 of net loans, at fair value, in pools of installment, commercial and
commercial real estate credits from the FDIC.
The premium paid for this acquisition will be amortized over a period of seven
years on a straight-line method.
LOAN PORTFOLIO
Types of Loans
The composition of the loans acquired and their respective yields are as
follows as of August 26, 1994:
Balance Average
($1,000s) Yield
-----------------------
Commercial $3,223 11.3%
Real estate other 2,125 11.9
Installment loans 402 12.2
------ ====
5,750
Unearned discount on acquired loans (526)
------
$5,224
======
6
7
COMBANCORP AND SUBSIDIARY
NOTES TO UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENTS
Maturities and Sensitivity to Changes in Interest Rates
The following sets forth the amount of total loans acquired (excluding
installment loans) at August 26, 1994 which are based on remaining scheduled
principal repayments due in one year or less, after one year through five years
and after five years. The amounts outstanding which are due after one year are
classified according to their sensitivity to changes in interest rates.
FACE VALUE ($1,000s)
One year or less $3,593
After one year through five years
Floating interest rate 1,236
Fixed interest rate 119
After five years
Floating interest rate 4
Fixed interest rate 396
------
$5,348
======
As of August 26, 1994, none of the loans acquired were classified as nonaccrual
or were contractually past due 90 days or more and still accruing interest.
Unearned discounts on loans acquired are amortized to income over the
contractual life of the loans.
The Company will provide an allowance for loan losses on these loans consistent
with their current policy.
7
8
COMBANCORP AND SUBSIDIARY
NOTES TO UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENTS
DEPOSITS
The deposit balances acquired as of August 26, 1994 are summarized as follows:
Average
Balance Rate
($1,000s) Paid
---------------------
Demand deposits, noninterest bearing $ 8,201 --%
Money market demand 2,354 2.6
Savings and other interest bearing demand 6,260 2.4
Time deposits 5,667 3.0
-------
$22,482
=======
Included in the above are approximately $2,000,000 of deposits the Company was
required to hold on behalf of the FDIC and which will be subsequently paid to
the FDIC.
IMPACT OF ACQUISITION
Overall, the impact of this transaction was to increase net assets by
$22,536,000 to $76,045,000. On a pro forma basis, capital ratios were as
follows:
June 30,
1994 Pro
Actual Forma
-------------------
Bank level
Capital to risk-weighted assets 21.5% 40.6%
Leverage ratio 9.8 7.1
The Bank acquired approximately $22,400,000 of deposits which included
approximately $2,000,000 of uninsured deposits held on behalf of the FDIC and
$2,000,000 of TCDs which paid off shortly after the acquisition. The net of
$18,400,000 was used to fund the approximately $674,000 of vault cash and the
$5,224,000 of loans, net, with the balance of approximately $12,500,000
available to increase the Bank's liquidity. At June 30, 1994, the Company had
a liquidity ratio of 57.5% and with the addition of the approximate $13,200,000
of liquid assets the Company's liquidity ratio would increase to 61.5%. On an
interim basis, these funds will be invested in federal funds sold or short-term
investment securities. This, coupled with the Bank's existing low
loan-to-deposit ratio, provides the Bank significant opportunities to fund
future loan demand.
8
9
COMBANCORP AND SUBSIDIARY
NOTES TO UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENTS
As noted elsewhere, the Company does not have any historical operating
information related to the assets acquired and liabilities assumed associated
with the Downey branch.
The Company anticipates improved overall operating results through the addition
of the relatively low cost deposit base to fund future loan demand and
investment activity. A nominal increase in the operating expenses of the
Company principally related to facility, personnel and related operational
costs of the branch are anticipated.
Future results will be dependent on the Company's ability to retain the deposit
base acquired, generate sufficient loan demand and to invest excess funds in
alternative investments at reasonable rates of return.
9
10
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: August 18, 1995 By: /s/ RICHARD F. DEMERJIAN
----------------------------
Richard F. Demerjian
Chief Executive Officer
Date: August 18, 1995 By: /s/ ESTHER G. WILSON
----------------------------
Esther G. Wilson
Chief Financial Officer
10