-----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, NUe74OQASKr7x4zlAh1xykj292iLArRlB/j+TNK8E/711ThDBTQfqjRMxij9TtB7 7hez561DzV1aUL84QbsDvQ== 0000950123-96-004442.txt : 19960816 0000950123-96-004442.hdr.sgml : 19960816 ACCESSION NUMBER: 0000950123-96-004442 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960814 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: 96612618 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 10-Q 1 SECURITIES AND EXCHANGE COMMISSION 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 June 30, 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 (I.R.S. Employer incorporation or organization) Identification No.) 6 West Second Street, Riverhead, New York 11901 - -------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) (516) 727-5667 - -------------------------------------------------------------------------------- (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. 3,330,909 SHARES OF COMMON STOCK OUTSTANDING AS OF JUNE 30, 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 June 30, 1996 and 1995 4 Consolidated Statements of Income, For the Six Months Ended June 30, 1996 and 1995 5 Consolidated Statements of Cash Flows, For the Six Months Ended June 30, 1996 and 1995 6 Notes to the Unaudited Consolidated Financial Statements 7 Management's Discussion and Analysis of Financial Condition and Results of Operations 7 Part II OTHER INFORMATION 8 Signatures 8
(2) 3 PART I SUFFOLK BANCORP AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF CONDITION (in thousands of dollars except number of shares)
ASSETS June 30, 1996 December 31, 1995 --------------------- --------------------- Cash and Due From Banks 43,586 48,955 Federal Funds Sold 16,900 32,500 Investment Securities: Investment Securities Available for Sale 114,401 137,043 Investment Securities Held to Maturity: United States Treasury Obligations 12,037 12,053 Obligations of States and Political Subdivisions 10,716 18,140 U.S. Govt. Agency Obligations 12,918 14,092 Other Securities 638 638 --------------------- --------------------- Total Investment Securities 150,710 181,966 Loans, Net of Discounts 560,644 515,938 Less: Allowance for Loan Loss 5,823 5,923 --------------------- --------------------- Net Loans 554,821 510,015 Premises and Equipment, Net 12,221 11,803 Other Real Estate Owned, Net 1,894 1,241 Accrued Interest Receivable, Net 5,449 5,133 Excess of Cost Over Fair Value of Net Assets Acquired 2,805 2,986 Other Assets 13,503 11,195 --------------------- --------------------- TOTAL ASSETS 801,889 805,794 ===================== ===================== LIABILITIES Demand Deposits 158,347 152,007 Savings, N.O.W.'s, and Money Market Deposits 350,205 359,331 Time Certificates of $100,000 or More 29,008 27,777 Other Time Deposit 184,419 187,945 --------------------- --------------------- Total Deposits 721,979 727,060 Dividends Payable on Common Stock 1,291 1,096 Accrued Interest Payable 1,740 1,830 Other Liabilities 6,919 5,763 --------------------- --------------------- TOTAL LIABILITIES 731,929 735,749 STOCKHOLDERS' EQUITY Common Stock (Par Value $5.00; 7,500,000 authorized 3,799,674 shares issued at June 30, 1996 and 1995, respectively) 18,998 18,998 Surplus 18,373 18,373 Undivided Profits 34,848 33,928 Treasury Stock (468,765 shares in 1996 and 390,365 in 1995) (2,344) (1,952) Investment Securities Valuation Allowance 85 698 --------------------- --------------------- TOTAL STOCKHOLDERS' EQUITY 69,960 70,045 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 801,889 805,794 ===================== =====================
(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 6/30/96 Ended 6/30/95 --------------------- --------------------- Loans (including fee income) 12,521 12,167 Federal Funds Sold 198 324 United States Treasury Obligations 1,621 1,346 Obligations of States and Political Subdivisions 197 408 U.S. Govt. Agency Obligations 447 517 Other Securities 9 9 --------------------- --------------------- Total Interest Income 14,993 14,771 INTEREST EXPENSE Savings, N.O.W.'s, and Money Market Deposits 1,953 2,125 Time Certificates of $100,000 or More 211 265 Other Time Deposits 2,670 2,588 Federal Funds Purchased 7 - Interest on Other Borrowings - 73 --------------------- --------------------- Total Interest Expense 4,841 5,051 Net Interest Income 10,152 9,720 Provision for Possible Loan Losses 295 115 --------------------- --------------------- Net Interest Income After Provision for Possible Loan Losses 9,857 9,605 OTHER INCOME Service Charges on Deposit Accounts 1,055 897 Other Service Charges, Commissions, and Fees 434 392 Fiduciary Activities 140 121 Other Operating Income 123 265 --------------------- --------------------- Total Other Income 1,752 1,675 OTHER EXPENSE Salaries and Employee Benefits 3,931 4,201 Net Occupancy Expense 580 638 Equipment Expense 643 816 Other Operating Expense 2,098 2,444 --------------------- --------------------- Total Other Expense 7,252 8,099 Income Before Taxes 4,357 3,181 Provision for Income Taxes 1,823 1,150 --------------------- --------------------- NET INCOME 2,534 2,031 ===================== ===================== Earnings Per Share 0.75 0.54 Average Shares 3,367,124 3,780,195
(4) 5 SUFFOLK BANCORP AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF INCOME (in thousands of dollars except shares and per share data)
Six Months Six Months INTEREST INCOME Ended 6/30/96 Ended 6/30/95 --------------------- --------------------- Loans (including fee income) 24,321 23,956 Federal Funds Sold 459 397 United States Treasury Obligations 3,520 3,281 Obligations of States and Political Subdivisions 404 828 U.S. Govt. Agency Obligations 941 1,044 Other Securities 19 19 --------------------- --------------------- Total Interest Income 29,664 29,525 INTEREST EXPENSE Savings, N.O.W.'s, and Money Market Deposits 3,974 4,302 Time Certificates of $100,000 or More 429 555 Other Time Deposits 5,420 4,499 Federal Funds Purchased 15 86 Interest on Other Borrowings - 607 --------------------- --------------------- Total Interest Expense 9,838 10,049 Net Interest Income 19,826 19,476 Provision for Possible Loan Losses 520 305 --------------------- --------------------- Net Interest Income After Provision for Possible Loan Losses 19,306 19,171 OTHER INCOME Service Charges on Deposit Accounts 2,018 1,800 Other Service Charges, Commissions, and Fees 787 752 Fiduciary Activities 275 236 Other Operating Income 308 408 --------------------- --------------------- Total Other Income 3,388 3,196 OTHER EXPENSE Salaries and Employee Benefits 7,919 8,398 Net Occupancy Expense 1,204 1,251 Equipment Expense 1,291 1,617 Other Operating Expense 3,808 4,548 --------------------- --------------------- Total Other Expense 14,222 15,814 Income Before Taxes 8,472 6,553 Provision for Income Taxes 3,485 2,321 --------------------- --------------------- NET INCOME 4,987 4,232 ===================== ===================== Earnings Per Share 1.47 1.12 Average Shares 3,377,720 3,789,881
(5) 6 SUFFOLK BANCORP AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands of dollars)
Six Months Six Months Ended 6/30/96 Ended 6/30/95 --------------------- --------------------- NET INCOME 4,987 4,232 ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH: Provision for Loan Losses 520 305 Depreciation 828 1,047 Amortization of Excess of Cost Over Fair Market Value of Net Assets Acquired 181 181 Accretion of Discounts (1,313) (549) Amortization of Premiums 293 50 Increase in Interest Receivable (316) (21) Increase in Other Assets (2,308) (378) (Decrease) Increase in Interest Payable (90) 531 Increase (Decrease) in Other Liabilities 1,156 (2,039) --------------------- --------------------- NET CASH PROVIDED BY OPERATING ACTIVITIES 3,938 3,359 CASH FLOWS FROM INVESTING ACTIVITIES Principal Payments on Investment Securities 1,210 1,189 Maturities of Investments Available for Sale 84,167 33,286 Purchases of Investments Available for Sale (60,512) (35,564) Maturities of Investments Held to Maturity 7,941 78,085 Purchases of Investments Held to Maturity (530) (31,586) Net Loan Disbursements and Repayments (47,383) 4,944 Purchases of Premises and Equipment, Net (1,246) (1,054) Disposition of OREO Property 1,034 844 --------------------- --------------------- NET CASH (USED) PROVIDED BY INVESTING ACTIVITIES (15,319) 50,144 CASH FLOWS FROM FINANCING ACTIVITIES Net Decrease in Deposit Accounts (5,081) (16,389) Proceeds from Other Borrowings - (4,300) Treasury Shares Acquired (2,438) (332) Dividends Paid to Shareholders (2,264) (1,482) Increase in Dividends Payable on Common Stock 195 31 --------------------- --------------------- NET CASH USED FROM FINANCING ACTIVITIES (9,588) (22,472) NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (20,969) 31,031 CASH AND CASH EQUIVALENTS: BEGINNING OF PERIOD 81,455 56,488 CASH AND CASH EQUIVALENTS: END OF PERIOD 60,486 87,519
(6) 7 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 and six months ended June 30, 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 OPERATIONS for the Three Month Periods ended June 30, 1996 and 1995 NET INCOME Net income was $2,534,000 for the quarter, ahead 24.8 percent from $2,031,000 posted during the same period last year. Earnings per share for the quarter were $0.75 versus $0.54, a gain of 38.9 percent. INTEREST INCOME Interest income was $14,993,000 for the second quarter 1996, up 1.5 percent from $14,771,000 posted for the same quarter in 1995. Average net loans for the second quarter of 1996 totaled $537,187,000, compared to $529,509,000 for the same period of 1995. During the second quarter of 1996, the yield on a fully taxable-equivalent basis, was 8.53 percent on average earning assets of $709,439,000, up from 8.31 percent on average earning assets of $722,924,000 during the second quarter of 1995. INTEREST EXPENSE Interest expense for the second quarter of 1996 was $4,841,000, down 4.2 percent from $5,051,000 for the same period of 1995. Average deposits for the second quarter 1996 were $705,307,000, up slightly from $701,262,000 for the comparable period in 1995. Savings deposits have decreased slightly as well as other time deposits. NET INTEREST INCOME Net interest income remains the largest component of the Bank's earnings. Net interest income for the second quarter of 1996 was $10,152,000, up from $9,720,000 during the same period of 1995, an increase of 4.4 percent. The net interest margin for the quarter, on a fully taxable-equivalent basis, was 5.80 percent compared to 5.51 percent for the same period of 1995. (7) 8 COVERAGE RATIOS The following table presents the coverage of troubled assets:
LAST 12 JUNE 30 MAR. 31 DEC. 31 SEPT. 30 MONTHS 1996 1996 1995 1995 Net Charge-offs/Average Net Loans (annualized) 0.24% 0.35% 0.35% 0.27% 0.01% Allowance for Loan Losses/Non-Accrual, Restructured, and OREO 88.26% 102.43% 79.89% 86.54% 84.19% Allowance for Loan Losses/Net Loans 1.12% 1.04% 1.10% 1.15% 1.20%
OTHER INCOME Other income increased to $1,752,000 for the three months ended June 30, 1996 compared to $1,675,000 for the same period during 1995. Trust revenue is up 15.7 percent . OTHER EXPENSE Other expense for the second quarter 1996 was $7,252,000, down 10.5 percent from $8,099,000 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 $69,960,000 on June 30, 1996, a slight decrease from $70,045,000 on December 31, 1995. The ratio of equity to assets was 8.7 percent at June 30, 1996 and 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 48,400 shares. Since December 31, 1995, the company has repurchased 78,400 shares or approximately 2.4 percent of shares outstanding at December 31, 1995. PART II ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. None. 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: August 14, 1996 /s/ Edward J. Merz ------------------------------ Edward J. Merz President and Chief Executive Officer Date: August 14, 1996 /s/ Victor F. Bozuhoski, Jr. ------------------------------ Victor F. Bozuhoski, Jr. Executive Vice President, Chief Financial Officer and Treasurer (8) 9 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: August 14, 1996 /s/ Edward J. Merz ------------------------------- Edward J. Merz President and Chief Executive Officer Date: August 13, 1996 /s/ Victor F. Bozuhoski, Jr ------------------------------- Victor F. Bozuhoski, Jr. Executive Vice President, Chief Financial Officer and Treasurer (9) EX-27 2 FINANCIAL DATA SCHEDULE
9 1,000 6-MOS DEC-31-1996 JAN-01-1996 JUN-30-1996 43,586 0 16,900 0 114,401 36,309 36,253 560,644 5,823 801,889 721,979 0 9,950 0 0 0 18,998 50,962 801,889 24,321 5,343 0 29,664 9,823 9,838 19,826 520 0 14,222 8,472 4,987 0 0 4,987 1.47 1.47 5.76 3,634 1,235 0 3,243 5,923 734 114 5,823 5,823 0 0
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