-----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, VBi5f+YK7MHUJsAtGgi0LzJaMiSGM69a34k4zYHlkRAB1CQQxGrsjPaWFBDI1yBd JWAQT51ML8lY/bIQncOFxg== 0000950123-96-002090.txt : 19960509 0000950123-96-002090.hdr.sgml : 19960509 ACCESSION NUMBER: 0000950123-96-002090 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960508 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: SUFFOLK BANCORP CENTRAL INDEX KEY: 0000754673 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 112708279 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-13580 FILM NUMBER: 96557683 BUSINESS ADDRESS: STREET 1: 6 W SECOND ST CITY: RIVERHEAD STATE: NY ZIP: 11901 BUSINESS PHONE: 516725667 MAIL ADDRESS: STREET 1: 6 WEST SECOND STREET CITY: RIVERHEAD STATE: NY ZIP: 11901 10-Q 1 QUARTERLY REPORT, QUARTER ENDED MARCH 31, 1996 1 Washington, D.C. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended March 31, 1996 Commission file number 0-13580 SUFFOLK BANCORP (exact name of registrant as specified in its charter) New York State 11-2708279 (State or other jurisdiction of incorporation (I.R.S. Employer or organization) Identification No.) 6 West Second Street, Riverhead, New York 11901 (Address of Principal Executive Offices) (Zip Code) (516) 727-3800 (Registrant's telephone number, including area code) NOT APPLICABLE (former name, former address and former fiscal year if changed since last report) 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. 3,379,309 SHARES OF COMMON STOCK OUTSTANDING AS OF MARCH 31, 1996 (1) 2 SUFFOLK BANCORP AND SUBSIDIARIES
Part I Financial Information page Consolidated Statements of Condition 3 Consolidated Statements of Income, For the Three Months Ended March 31, 1996 and 1995 4 Statements of Cash Flows, For the Three Months Ended March 31, 1996 and 1995 5 Notes to the Unaudited Consolidated Financial Statements 6 Management's Discussion and Analysis of Financial Condition and Results of Operations 6 Part II Other Information 7 Signatures 8
(2) 3 SUFFOLK BANCORP AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF CONDITION (in thousands of dollars except number of shares)
ASSETS March 31, 1996 December 31, 1995 -------------- ----------------- Cash and Due From Banks 34,444 48,955 Federal Funds Sold 0 32,500 Investment Securities: Investment Securities Available for Sale 119,769 137,043 Investment Securities Held to Maturity: United States Treasury Obligations 12,045 12,053 Obligations of States and Political Subdivisions 17,152 18,140 U.S. Govt. Agency Obligations 13,526 14,092 Other Securities 638 638 -------- -------- Total Investment Securities 163,130 181,966 Loans, Net of Discounts 524,426 515,938 Less: Allowance for loan loss 5,708 5,923 -------- -------- Net Loans 518,718 510,015 Premises and Equipment, net 12,347 11,803 Other Real Estate Owned, net 2,279 1,241 Accrued Interest Receivable, net 4,186 5,133 Intangible Assets 2,895 2,986 Other Assets 11,416 11,195 -------- -------- TOTAL ASSETS 749,415 805,794 ======== ======== LIABILITIES Demand Deposits 136,309 152,007 Savings, N.O.W.'s and Money Market Deposits 313,259 359,331 Time Certificates of $100,000 or More 28,910 27,777 Other Time Deposit 187,951 187,945 -------- -------- Total Deposits 666,429 727,060 Federal Funds Purchased 1,300 -- Dividends Payable on Common Stock 1,168 1,096 Accrued Interest Payable 1,749 1,830 Other Liabilities 8,575 5,763 -------- -------- TOTAL LIABILITIES 679,221 735,749 STOCKHOLDER'S EQUITY Common Stock (Par Value $5.00; 7,500,000 authorized 3,379,309 and 3,799,674 shares outstanding at March 31, 1996 and 1995, respectively) 18,998 18,998 Surplus 18,373 18,373 Undivided Profits 34,598 33,928 Treasury Stock (420,365 shares in 1996 and 390,365 in 1995) (2,102) (1,952) Investment Securities Valuation Allowance 327 698 -------- -------- TOTAL STOCKHOLDERS EQUITY 70,194 70,045 TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY 749,415 805,794 ======== ========
(3) 4 SUFFOLK BANCORP AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF INCOME (in thousands of dollars except shares and per share data)
Three Months Three Months INTEREST INCOME Ended 03/31/96 Ended 03/31/95 --------- --------- Loans (including fee income) 11,800 11,789 Federal Funds Sold 261 73 United States Treasury Obligations 1,899 1,935 Obligations of States and Political Subdivisions 207 420 U.S. Govt. Agency Obligations 494 527 Other Securities 10 10 --------- --------- Total Interest Income 14,671 14,754 INTEREST EXPENSE Savings, N.O.W.'s and Money Market Deposits 2,021 2,177 Time Certificates of $100,000 or more 218 290 Other Time Deposits 2,750 1,911 Federal Funds Purchased 8 86 Interest on Other Borrowings -- 534 --------- --------- Total Interest Expense 4,997 4,998 Net Interest Income 9,674 9,756 Provision for Possible Loan Losses 225 190 --------- --------- Net Income After Provision for Possible Loan Losses 9,449 9,566 OTHER INCOME Service Charges on Deposit Accounts 963 903 Other Service Charges, Commissions & Fees 353 360 Fiduciary Activities 135 115 Other Operating Income 185 143 --------- --------- Total Other Income 1,636 1,521 OTHER EXPENSE Salaries and Employee Benefits 3,988 4,197 Net Occupancy Expense 624 613 Equipment Expense 648 801 Other Operating Expense 1,710 2,104 --------- --------- Total Other Expense 6,970 7,715 Income Before Taxes 4,115 3,372 Provision for Income Taxes 1,662 1,171 --------- --------- NET INCOME 2,453 2,201 ========= ========= Earnings Per Share 0.72 0.58 Average Shares 3,394,595 3,799,674
(4) 5 SUFFOLK BANCORP AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands of dollars)
Three Months Three Months Ended 03/31/96 Ended 03/31/95 ------- ------- NET INCOME 2,453 2,201 ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH : Provision for Loan Losses 225 190 Depreciation 421 513 Amortization of Excess of Cost Over Fair Market Value of Net Assets Acquired 91 91 Accretion of Discounts (813) (852) Amortization of Premiums 153 23 Decrease in Interest Receivable 947 -- Increase in Other Assets (221) (97) (Decrease) Increase in Interest Payable (81) 322 Increase in Other Liabilities 2,812 621 ------- ------- NET CASH PROVIDED BY OPERATING ACTIVITIES 5,987 3,012 CASH FLOWS FROM INVESTING ACTIVITIES Principal Payments on Investment Securities 584 693 Maturities of Investments Held to Maturity 1,419 6,240 Purchases of Investments Held to Maturity (442) (2,219) Maturities of Investments Available for Sale 32,755 49,020 Purchases of Investments Available for Sale (14,820) (28,603) Net Loan Disbursements & Repayments (10,100) 789 Purchases of Premises and Equipment, Net (965) (738) Disposition of OREO Property -- 651 ------- ------- Net Cash Provided (Used) from Investing Activities 8,431 25,833 CASH FLOWS FROM FINANCING ACTIVITIES Net Decrease in Deposit Accounts (60,631) (39,992) Increase in Federal Funds Purchased 1,300 -- Proceeds from Other Borrowings -- 6,818 Treasury Shares Acquired (1,074) -- Dividends Paid to Shareholders (1,096) (722) Increase in Accrued Dividends Payable 72 38 ------- ------- NET CASH USED FROM FINANCING ACTIVITIES (61,429) (33,858) NET DECREASE IN CASH AND CASH EQUIVALENTS (47,011) (5,013) CASH AND CASH EQUIVALENTS: BEGINNING OF PERIOD 81,455 56,488 CASH AND CASH EQUIVALENTS: END OF PERIOD 34,444 51,475
(5) 6 SUFFOLK BANCORP AND SUBSIDIARIES NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (1) GENERAL In the opinion of management, the accompanying unaudited consolidated financial statements of Suffolk Bancorp and its consolidated subsidiaries have been prepared to reflect all adjustments (consisting solely of normally recurring accruals) necessary for a fair presentation of the financial condition and results of operations for the periods presented. Certain information and footnotes normally included in consolidated financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. Notwithstanding, management believes that the disclosures are adequate to prevent the information from misleading the reader, particularly when the accompanying consolidated financial statements are read in conjunction with the audited consolidated financial statements and notes thereto included in the Registrant's annual report and on Form 10-K, for the year ended December 31, 1995. The results of operations for the three months ended March 31, 1996, are not necessarily indicative of the results of operations to be expected for the remainder of the year. (2) IMPACT OF NEW ACCOUNTING STANDARDS Effective January 1, 1996, the Company adopted Statement of Financial Accountings Standards ("SFAS") No. 122, "Accounting for Mortgage Servicing Rights" ("Statement 122") which is an amendment of SFAS No. 65, "Accounting for Certain Mortgage Banking Activities." This statement requires the recognition as separate assets rights to service mortgage loans for others, however those servicing rights are acquired. Statement 122 did not have a material effect on the Company's financial condition or results of operations. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION for the Three Month Periods ended March 31, 1996 and 1995 NET INCOME Net income was $2,453,000 for the quarter, ahead 11.4 percent from $2,201,000 posted during the same period last year. Earnings per share for the quarter were $0.72 versus $0.58, a gain of 24.1 percent. INTEREST INCOME Interest income was $14,671,000 for the first quarter 1996, down 0.6 percent from $14,754,000 posted for the same quarter in 1995. Average net loans for the first quarter of 1996 totaled $509,375,000, compared to $528,336,000 for the same period of 1995. During the first quarter of 1996, the yield was 8.32 percent on average earning assets of $711,726,000, up from 7.97 percent on average earning assets of $753,074,000 during the first quarter of 1995. The slight decrease in interest income, despite the increase in yield, is attributable to the decline in average balances of earning assets. INTEREST EXPENSE Interest expense for the first quarter of 1996 was $4,997,000, down slightly from $4,998,000 for the same period of 1995. Average deposits for the first quarter 1996 were $703,570,000, up from $690,818,000 for the comparable period in 1995. Other borrowings, in the form of federal funds purchased, averaged $570,000 during the first quarter 1996, compared to $5,588,000 during first quarter 1995. Savings deposits have decreased and other time deposits have increased. NET INTEREST INCOME Net interest income remains the largest component of the Bank's earnings. Net interest income for the first quarter of 1996 was $9,674,000, down from $9,756,000 during the same period of 1995, a slight decrease. The net interest margin for the quarter, on a fully taxable-equivalent basis, was 5.52 percent compared to 5.32 percent for the same period of 1995. (6) 7 The following table presents the coverage of troubled assets:
LAST 12 MAR. 31 DEC. 31 SEPT. 30 JUNE 30 COVERAGE RATIOS MONTHS 1996 1995 1995 1995 Net Charge-offs/Average Net Loans (annualized) 0.18% 0.35% 0.27% 0.01% 0.12% Allowance for Loan Losses/Non-Accrual, Restructured, & OREO 85.10% 79.89% 86.54% 84.19% 89.78% Allowance for Loan Losses/Net Loans 1.16% 1.10% 1.15% 1.20% 1.16%
OTHER INCOME Other income increased to $1,636,000 for the three months ended March 31, 1996 compared to $1,521,000 for the same period during 1995. Trust revenue is up 17 percent and other operating income is up 29 percent. OTHER EXPENSE Other expense for the first quarter 1996 was $6,970,000, down 10 percent from $7,715,000 for the comparable period in 1995. Compensation is down because the number of employees has been reduced primarily through attrition. Equipment expense is down because more equipment is fully depreciated, and because of the ongoing control of the purchase of equipment . Other expense reflects a decrease in FDIC insurance premiums. CAPITAL RESOURCES Stockholders' equity totaled $70,194,000 on March 31, 1996, an increase of $148,000 from $70,046,000 on December 31, 1995. The ratio of equity to assets was 9.4 percent at March 31, 1996 and 8.7 percent at December 31, 1995. In January of 1996, the Company announced its intention to repurchase five percent of the common shares then outstanding, or approximately 171,000 shares. During the quarter, the Company repurchased 35,000 shares, or approximately 1 percent of the shares outstanding at December 31, 1995. PART II ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. None. (7) 8 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. SUFFOLK BANCORP Date: May 9, 1996 /s/ Edward J. Merz ------------------------------ Edward J. Merz President & Chief Executive Officer Date: May 9, 1996 /s/ Victor F. Bozuhoski, Jr. ------------------------------ Victor F. Bozuhoski, Jr. Executive Vice President, Treasurer & Chief Financial Officer (8) 9 EXHIBIT INDEX Exhibit No. Description - ----------- ----------- 27 Financial Data Schedule EX-27 2 FINANCIAL DATA SCHEDULE
9 1,000 3-MOS DEC-31-1996 JAN-01-1996 MAR-31-1996 34,444 0 0 0 119,769 43,361 43,576 524,426 5,708 749,415 666,429 1,300 11,492 0 18,998 0 0 51,196 749,415 11,800 2,871 0 14,671 4,899 4,997 9,674 225 0 6,970 4,115 2,453 0 0 2,453 0.72 0.72 5.52 4,281 1,483 507 0 5,923 510 70 5,708 5,708 0 0
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