-----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, PmcKcKg/MddNjnwVBbcHHVnsQkDClI2WkzS9q1SvP0bROnsL1papIF59J50lcfbM 2AVP3Jvu/Dcynnj27qU7mQ== 0000785813-99-000013.txt : 19990517 0000785813-99-000013.hdr.sgml : 19990517 ACCESSION NUMBER: 0000785813-99-000013 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990331 FILED AS OF DATE: 19990514 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CENTURY BANCSHARES INC CENTRAL INDEX KEY: 0000785813 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 521489098 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-16234 FILM NUMBER: 99621938 BUSINESS ADDRESS: STREET 1: 1275 PENNSYLVANIA AVE., N.W. CITY: WASHINGTON STATE: DC ZIP: 20004 BUSINESS PHONE: 202-496-40 MAIL ADDRESS: STREET 1: 1275 PENNSYLVANIA AVE NW CITY: WASHINGTON STATE: DC ZIP: 20004 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1999 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: 0-16234 CENTURY BANCSHARES, INC. (Exact Name of Registrant as Specified in its Charter) DELAWARE 52-1489098 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1275 PENNSYLVANIA AVENUE, N.W. WASHINGTON, D. C. 20004 (Address of Principal Executive Offices) (Zip Code) (202) 496-4100 (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 At April 30, 1999 there were 2,589,212 shares of the registrant's Common Stock, par value $1.00 per share outstanding.
CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q For The Quarter Ended March 31, 1999 TABLE OF CONTENTS PART I - FINANCIAL INFORMATION Item 1. Financial Statements 1 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 8 Item 3. Quantitative and Qualitative Disclosures About Market Risk 21 PART II - OTHER INFORMATION Item 1. Legal Proceedings 22 Item 2. Changes in Securities and Use of Proceeds 22 Item 3. Defaults Upon Senior Securities 22 Item 4. Submission of Matters to a Vote of Security Holders 22 Item 5. Other Information 22 Item 6. Exhibits and Reports on Form 8-K 22 Signatures 23 Exhibit Index 24 Exhibit 27 Financial Data Schedule for the quarter ended March 31, 1999 25
PART I - FINANCIAL INFORMATION Item 1. Condensed Financial Information CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q Consolidated Statements of Financial Condition March 31, 1999, and December 31, 1998
March 31, December 31, 1999 1998 (Unaudited) ---------------- ---------------- ASSETS Cash and due from banks $ 8,644,262 $ 8,950,733 Federal funds sold 5,000,000 4,285,000 Interest bearing deposits in other banks 8,802,149 9,847,315 Investment securities available-for-sale, at fair value 9,570,965 6,811,356 Investment securities, at cost, fair value of $2,188,796 and $2,449,680 at March 31, 1999 and December 31, 1998, respectively 2,214,132 2,441,537 Loans, net of unearned income 125,963,387 115,231,298 Less: allowance for credit losses (1,309,929) (1,128,147) ---------------- ---------------- Loans, net 124,653,458 114,103,151 Premises and equipment, net 1,272,600 1,372,370 Accrued interest receivable 799,794 742,721 Deposit premiums 1,498,848 1,546,232 Net deferred taxes 680,623 683,113 Other assets 618,226 566,373 ---------------- ---------------- Total Assets $ 163,755,057 $ 151,349,901 ---------------- ---------------- LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities: Deposits: Noninterest-bearing $ 29,062,424 $ 31,676,194 Interest-bearing 109,597,354 94,535,082 ---------------- ---------------- Total deposits 138,659,778 126,211,276 Other borrowings 8,118,557 8,461,241 Other liabilities 1,425,880 1,360,710 ---------------- ---------------- Total Liabilities 148,204,215 136,033,227 ---------------- ---------------- Stockholders' Equity: Common stock, $1 par value; 5,000,000 shares authorized; 2,583,462, and 2,574,219 shares issued and outstanding at March 31, 1999 and December 31, 1998, respectively 2,583,462 2,574,219 Additional paid in capital 12,367,473 12,343,631 Retained earnings 603,731 392,384 Accumulated other comprehensive income, net of tax effect (3,824) 6,440 ---------------- ---------------- Total Stockholders' Equity 15,550,842 15,316,674 Commitments and contingencies ---------------- ---------------- Total Liabilities and Stockholders' Equity $ 163,755,057 $ 151,349,901 ---------------- ----------------
See accompanying condensed notes to consolidated financial statements (unaudited). -1- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q Consolidated Statements of Operations (Unaudited) Three Months Ended March 31, 1999 and 1998
Three Months Three Months Ended Ended March 31, 1999 March 31, 1998 ---------------- ---------------- Interest income: Interest and fees on loans $ 2,649,950 $ 2,333,592 Interest on federal funds sold 47,470 73,760 Interest on deposits in other banks 123,928 258,282 Interest on securities available-for-sale 100,109 215,428 Interest on securities held-to-maturity 37,583 82,552 --------------- --------------- Total interest income 2,959,040 2,963,614 Interest expense: Interest on deposits: Savings accounts 215,121 192,708 NOW accounts 60,387 92,224 Money market accounts 164,140 233,220 Certificates under $100,000 286,368 360,397 Certificates $100,000 and over 208,988 222,680 --------------- --------------- Total interest on deposits 935,004 1,101,229 Interest on other borrowings 128,663 126,289 --------------- --------------- Total interest expense 1,063,667 1,227,518 --------------- --------------- Net interest income 1,895,373 1,736,096 Provision for credit losses 180,000 193,000 --------------- --------------- Net interest income after provision for credit losses 1,715,373 1,543,096 Noninterest income: Service charges on deposit accounts 153,575 98,437 Other operating income 236,406 152,208 --------------- --------------- Total noninterest income 389,981 250,645 --------------- --------------- Noninterest expense: Salaries and employee benefits 664,960 603,579 Occupancy and equipment expense 206,375 205,923 Professional fees 164,232 190,689 Depreciation and amortization of premises and equipment 117,415 118,367 Amortization of deposit premiums 47,384 47,384 Data processing 261,169 167,633 Communications 78,992 63,517 Federal deposit insurance premiums 4,351 6,260 Other operating expenses 218,812 166,832 --------------- --------------- --------------- --------------- Total noninterest expense 1,763,690 1,570,184 --------------- --------------- Income before income tax expense 341,664 223,557 Income tax expense 130,317 91,667 --------------- --------------- Net income $ 211,347 $ 131,890 --------------- --------------- Basic income per common share $ 0.08 $ 0.06 Diluted income per common share 0.08 0.05 Weighted-average common shares outstanding 2,579,809 2,324,723
See accompanying condensed notes to consolidated financial statements (unaudited). -2- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q Consolidated Statements of Stockholders' Equity (Unaudited) Three Months Ended March 31, 1999 and 1998
Accumulated Common Additional Other Total stock paid in Retained Comprehensive Stockholders' $1.00 par capital earnings Income Equity ----------------- ------------------- ---------------- ----------------------------------- Balance, December 31, 1997 $ 2,209,229 $ 10,695,480 $ 651,646 $ (20,829) $ 13,535,526 Comprehensive Income: Net income 131,890 131,890 Unrealized gain on investment securities available-for-sale, net of tax effect of $18,092 33,600 33,600 ------------------------------------------------------------------------------------------- Total Comprehensive Income - - 131,890 33,600 165,490 Exercise of common stock options 13,469 shares 13,469 4,321 17,790 Exercise of warrants 1,519 shares 1,519 6,255 7,774 ------------------------------------------------------------------------------------------- Balance, March 31, 1998 $ 2,224,217 $ 10,706,056 $ 783,536 $ 12,771 $ 13,726,580 ------------------------------------------------------------------------------------------- Balance, December 31, 1998 $ 2,574,219 $ 12,343,631 $ 392,384 $ 6,440 $ 15,316,674 Comprehensive Income Net income 211,347 211,347 Unrealized gain (loss) on investment securities available-for-sale, net of tax effect of $(5,527) (10,264) (10,264) ------------------------------------------------------------------------------------------- Total Comprehensive Income - - 211,347 (10,264) 201,083 Exercise of common stock options 9,243 shares 9,243 23,842 33,085 ------------------------------------------------------------------------------------------- Balance, March 31, 1999 $ 2,583,462 $ 12,367,473 $ 603,731 $ (3,824) $ 15,550,842 -------------------------------------------------------------------------------------------
See accompanying condensed notes to consolidated financial statements (unaudited). -3- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q Consolidated Statements of Cash Flows (Unaudited) Three Months Ended March 31, 1999 and 1998
Three Months Three Months Ended Ended March 31, 1999 March 31, 1998 ----------------- ----------------- Cash flows from operating activities: Net income $ 211,347 $ 131,890 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization of premises and equipment 117,415 118,367 Amortization of deposit premiums 47,384 47,384 Provision for credit losses 180,000 193,000 (Increase) decrease in accrued interest receivable (57,073) 93,832 (Increase) decrease in other assets (57,848) (69,191) Increase (decrease) in other liabilities 65,170 961 ----------------- ----------------- Total adjustments 295,048 384,353 ----------------- ----------------- Net cash provided by operating activities 506,395 516,243 ----------------- ----------------- Cash flows from investing activities: Net decrease (increase) in loans (10,732,089) (2,184,626) Net decrease (increase) in interest bearing deposits in other banks 1,045,166 11,673,802 Purchases of securities available-for-sale (3,170,000) (1,998,440) Repayments and maturities of securities available-for-sale 410,391 1,170,426 Repayments and maturities of securities held-to-maturity 227,405 773,597 Purchase of premises and equipment (17,645) (65,610) ----------------- ----------------- Net cash provided by (used in) investing activities (12,236,772) 9,369,149 ----------------- ----------------- Cash flows from financing activities: Net (decrease) increase in demand, savings, NOW and money market deposit accounts 4,940,095 (5,117,028) Net (decrease) increase in certificates of deposit 7,508,410 (3,830,300) Net (decrease) increase in other borrowings (140,900) (314,533) Repayment of long-term debt (201,784) (202,439) Net proceeds from issuance of common stock 33,085 25,564 ----------------- ----------------- Net cash (used in) provided by financing activities 12,138,906 (9,438,736) ----------------- ----------------- Net increase (decrease) in cash and cash equivalents 408,529 446,656 Cash and cash equivalents, beginning of year 13,235,733 12,069,139 ----------------- ----------------- Cash and cash equivalents, end of period $ 13,644,262 $ 12,515,795 ----------------- ----------------- Supplemental disclosures of cash flow information: Interest paid on deposits and borrowings $ 1,055,008 $ 1,240,058 Income taxes paid 75,000 27,000
See accompanying condensed notes to consolidated financial statements (unaudited). -4- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (1) Basis of Presentation In the opinion of management the unaudited consolidated financial statements as of March 31, 1999 and December 31, 1998 and for the three months ended March 31, 1999 and 1998 contain all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the financial position and results of operations of the Company as of such dates and for such periods. The unaudited consolidated financial statements should be read in conjunction with the Consolidated Financial Statements of the Company and the Notes thereto appearing in the Company's 1998 Annual Report on Form 10-K filed with the Securities and Exchange Commission. The results of operations for the three months ended March 31, 1999 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 1999 or any future periods. Certain prior period balances have been restated to conform with the current period. (2) Investment Securities Investment securities available-for-sale, and their contractual maturities, at March 31, 1999 are summarized as follows:
Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value - ------------------------------------------------------------------------------------------------------------------- Obligations of U.S. treasury and government agencies: Within one year $ 1,999,343 $ 8,995 $ - $ 2,008,338 After one, but within five years 3,168,374 - 7,078 3,161,296 After five, but within ten years 1,346,710 9,957 - 1,356,667 After ten years 533,086 522 7,212 526,396 ------------------------------------------------------------ Total 7,047,513 19,474 14,290 7,052,697 ------------------------------------------------------------ Collateralized mortgage obligations: After one, but within five years 363,169 - 6,341 356,828 After ten years 233,854 - 4,726 229,128 ------------------------------------------------------------ Total 597,023 - 11,067 585,956 ------------------------------------------------------------ Federal Reserve Bank stock 236,350 - - 236,350 Federal Home Loan Bank stock 821,800 - - 821,800 Other 874,162 - - 874,162 ------------------------------------------------------------ Total investment securities available-for-sale $ 9,576,848 $ 19,474 $ 25,357 $ 9,570,965 ------------------------------------------------------------ Investment securities held-to-maturity, and their contractual maturities at March 31, 1999, are summarized as follows: Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value - ------------------------------------------------------------------------------------------------------------------- Obligations of U.S. treasury and government agencies: After one, but within five years $ 128,883 $ 81 $ - $ 128,964 After ten years 2,085,249 - 25,417 2,059,832 ------------------------------------------------------------ Total investment securities held-to-maturity $ 2,214,132 $ 81 $ 25,417 $ 2,188,796 ------------------------------------------------------------
-5- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (3) Income per Common Share Basic income per share is calculated by dividing net income by the weighted-average common shares outstanding. Diluted income per share is calculated by dividing net income by the sum of weighted-average common shares and common stock equivalents. On May 19, 1998, the Company declared a 5 percent stock dividend payable on June 29, 1998 to common stock shareholders of record as of May 29, 1998 resulting in the issuance of 112,665 shares and a corresponding increase in stock options and warrants outstanding. Weighted-average shares outstanding and income per common share have been restated for the effect of the 1998 stock dividends.
Three Months Ended March 31, ----------------------------- 1999 1998 ----------------------------- Basic Income Per Share: Net income applicable to common stock $211,347 $131,890 Weighted-average common shares outstanding 2,579,809 2,324,723 ----------------------------- Basic income per share $0.08 $0.06 ----------------------------- Diluted Income Per Share: Net income applicable to common stock $211,347 $131,890 Weighted-average common shares outstanding 2,579,809 2,324,723 Dilutive effect of warrants and stock options 24,576 194,811 ----------------------------- Diluted weighted-average common shares outstanding 2,604,385 2,519,534 Diluted income per share $0.08 $0.05 -----------------------------
-6- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (4) New Financial Accounting Standards Effective January 1, 1998, the Company adopted SFAS No. 130 "Reporting Comprehensive Income." SFAS No. 130 requires that certain financial activity normally disclosed in stockholders' equity be reported in the statement of operations as an adjustment to net income in computing comprehensive income. In addition, SFAS No. 130 requires restatement of all prior periods presented. Items applicable to the Company include unrealized gains and losses on investment securities. Accumulated comprehensive income components are to be reported in a separate caption in the consolidated statements of stockholders' equity. The Company did not experience any financial impact from the implementation of SFAS No. 130. In June 1998, SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities," was issued. SFAS 133 requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure these instruments at fair value. In certain circumstances a derivative may be specifically designed as a hedge of the exposure to changes in the fair values of a recognized asset or liability or an unrecognized firm commitment, the exposure to variable cash flows of a forecasted transaction, or the exposure to fluctuations in foreign currency. SFAS No. 133 will be effective for all periods beginning after June 15, 1999. Earlier application is permitted, but the statement shall not be applied retroactively to financial statements of prior periods. The Company does not anticipate any material impact from the implementation of SFAS No. 133. -7- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Overview Century Bancshares, Inc., a Delaware corporation ("Company"), and a registered bank holding company under the Bank Holding Company Act of 1956, as amended ("BHCA"), was incorporated and organized in 1985. The Company began active operations in 1986 with the acquisition of its subsidiary, Century National Bank ("Bank"), a full service bank which opened for business in 1982. The Bank provides a broad line of financial products and services to small and medium sized businesses and consumers, through its main office located at 1875 Eye Street, N.W., Washington, D.C., a branch office located at 1275 Pennsylvania Avenue, N.W., two offices in Northern Virginia at 8251 Greensboro Drive and 6832 Old Dominion Drive, McLean, Virginia, and a branch office at 7625 Wisconsin Avenue, Bethesda, Maryland. Lending services are concentrated in professional, service, commercial business sectors located in the metropolitan Washington, DC area. The Company's principal executive offices are located at 1275 Pennsylvania Avenue, N.W., Washington, DC 20004, and its phone number at that address is (202) 496-4100. The Company derives substantially all of its revenue and income from the operation of the Bank, which provides a full range of commercial and consumer banking services to small and middle market businesses and individuals in the Washington, DC metropolitan area. As of March 31, 1999, the Company had total assets of $163.8 million, total deposits of $138.7 million, and stockholders' equity of $15.6 million. At March 31, 1999, the Company had approximately 1,000 shareholders of the Company's common stock, par value $1.00 per share ("Common Stock"). Items 2 and 3 of this report contain certain forward-looking statements regarding future financial condition and results of operations and the Company's business operations. The words "expect," "estimate," "anticipate," "predict" and similar expressions are intended to identify forward-looking statements. Such statements involve risks, uncertainties and assumptions and, although the Company believes that assumptions are reasonable, it can give no assurance that its expectations regarding these matters will be achieved. The important factors that could cause actual results to differ materially from the forward-looking statements include, without limitation, the factors discussed in the Company's Form 10-K for the year ended December 31, 1998 under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" as well as the following factors: general economic conditions in the Washington, D.C. metropolitan area; changes in interest rates; changes in asset quality; the effect on the Company of the extensive scheme of regulation by several federal agencies; the departure of certain key executives; the year 2000 problem; and competition from other providers of financial services. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, such actual outcomes may vary materially from those indicated. Net Income For the three months ended March 31, 1999, the Company's net income was $211 thousand, or $0.08 per diluted share, compared with $132 thousand for the first three months of 1998, or $0.05 per diluted share. The 60% increase in net income was primarily attributable to a $159 thousand increase in net interest income resulting from a significant increase in earning assets, and a $139 thousand increase in noninterest income, offset by a $194 thousand increase in noninterest expense. Service charges on deposit accounts increased by 56% to $154 thousand, and other operating income also increased 55% to $236 thousand primarily as a result of an increase in bank card revenues. Increases in noninterest expenses included 10% a increase in the cost of salaries and benefits and a 56% increase in data processing due largely to the increased costs of bank card processing of merchant accounts. Return on average assets was 0.56% in the first quarter of 1999, compared to 0.36% for the same period in 1998. Return on average stockholders' equity was 5.56% for the quarter ended March 31, 1999, compared with 3.91% for the same period in 1998. Stockholders' equity to total assets was 9.50% at March 31, 1999 compared to 9.58% at March 31, 1998. -8- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED Net Interest Income Net interest income was $1.9 million for the quarter ended March 31, 1999, compared with $1.7 million for the quarter ended March 31, 1998, an increase of $159 thousand, or 9%. The increase in net interest income between the periods was due to an increase in the net interest spread as the 0.53% reduction in the cost of funds exceeded the 0.32% reduction in the gross yield on earning assets, and there was a $6.8 million increase in average net interest earning assets while the net interest margin improved 0.27% to 5.39% during the first three months of 1999. While the reduction in the yields of each of the components of earning assets was greater than the reduction in the average earning assets, there was a redeployment of assets from relatively lower yielding securities and interest bearing deposits to relatively higher yielding loans. The following table sets forth the averages of interest earned or paid by significant categories of interest earning assets and interest bearing liabilities for the three month periods ending March 31, 1999 and 1998. -9- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED Three Months Ended March 31, ------------------------------------------------------------------------------- 1999 1998 ---------------------------------------- ------------------------------------ Interest Interest Average Income/ Average Average Income/ Average Balance Expense Rate Balance Expense Rate ---------------------------------------- ------------------------------------ ($ in thousands) Interest-Earning Assets Loans, net (1) $ 118,858 $ 2,650 9.04% $ 94,262 $ 2,334 10.04% Investment securities (2) 10,023 138 5.58% 19,217 298 6.29% Federal funds sold 3,811 47 5.00% 5,417 74 5.54% Interest bearing deposits with banks 9,949 124 5.05% 18,720 258 5.59% ---------------------------------------- ----------------------------------- Total interest-earning assets 142,641 2,959 8.41% 137,616 2,964 8.73% Cash and due from banks 6,841 5,281 Other assets 3,768 4,795 ------------- -------------- Total Assets $ 153,250 $ 147,692 ------------- -------------- Interest-Bearing Liabilities Interest-Bearing Deposits: NOW accounts $ 19,216 $ 61 1.29% $ 18,685 $ 92 2.00% Savings accounts 20,680 215 4.22% 17,012 193 4.60% Money market accounts 21,191 164 3.14% 24,198 233 3.91% Time deposits 38,404 495 5.23% 42,202 583 5.60% Borrowings and notes payable 8,463 129 6.18% 7,677 127 6.71% ---------------------------------------- ------------------------------------ Total interest-bearing liabilities 107,954 1,064 4.00% 109,774 1,228 4.53% ---------------------------------------- ------------------------------------ Non-interest bearing deposits 28,130 22,929 Other liabilities 1,744 1,323 ------------- -------------- Total liabilities 137,828 134,026 Stockholders' equity 15,422 13,666 ------------- -------------- Total liabilities and stockholders' equity $ 153,250 $ 147,692 ------------- -------------- Net interest income and spread $ 1,895 4.41% $ 1,736 4.20% --------------------------- ---------------------- Net interest margin 5.39% 5.12% ------------- ---------
(1) Non-accrual loan balances are included in the calculation of Average Balances - Loans, Net. Interest income on non-accrual loan balances is included in interest income to the extent that it has been collected. (2) Average balance and average rate for investment securities are computed based on book value of securities held-to-maturity and cost basis of securities available-for-sale. -10- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED Noninterest Income Noninterest income was $390 thousand in the first quarter of 1999, a $139 thousand increase when compared with the same quarter of 1998, which totaled $251 thousand (see table below). The increase between the periods was primarily due to increases in deposit service charges, credit card and merchant fees caused by increased volumes.
Noninterest Income Three Months Ended (in thousands) March 31, Change ------------------------------------------------- 1999 1998 $ % ------------------------------------------------- Service charges on deposit accounts $ 153,575 $ 98,437 $ 55,138 56.0% Credit card and merchant fees 189,635 115,475 74,160 64.2% Commission and other fee income 32,984 25,152 7,832 31.1% Other income 13,787 11,581 2,206 19.0% ------------------------------------------------- Total noninterest income $ 389,981 $250,64 $ 139,336 55.6% -------------------------------------------------
-11- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED Noninterest Expense Noninterest expense totaled $1.8 million in the first quarter of 1999, an increase of $194 thousand, or 12%, when compared with 1998's totalnoninterest expense of $1.6 million. The increase in moninterest expense included a $94 thousand (56%) increase in data processing, which corresponds with the growth in the bank's operations, the volume of bank card processing of merchant accounts, and the costs of Y2K preparedness. A significant increase in the scope of the Company's operations was accompanied by increases in many of the noninterest expense categories, including salaries and benefits, which increased by $61 thousand (10%) and communications which increased by $15 thousand (24%).
Noninterest Expense Three Months Ended (in thousands) March 31, Change ------------------------------------------------ 1999 1998 $ % ------------------------------------------------ Salaries and employee benefits $ 664,960 $ 603,579 $ 61,381 10.2% Occupancy and equipment expense 206,375 205,923 452 0.2% Professional fees 164,232 190,689 (26,457) -13.9% Data Processing 261,169 167,633 93,536 55.8% Depreciation and amortization of premises and equipment 117,415 118,367 (952) -0.8% Amortization of deposit premiums 47,384 47,384 - 0.0% Communications 78,992 63,517 15,475 24.4% Other expenses 223,163 173,092 50,071 28.9% ------------------------------------------------- Total noninterest expense $ 1,763,690 $1,570,184 $193,506 12.3% -------------------------------------------------
-12- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED Investments The Company's investment portfolio of $11.8 million as of March 31, 1999 consisted mostly of U.S. Government Agency obligations. This represented an increase of $2.5 million, or 27%, compared with the investment portfolio total of $9.3 million at December 31, 1998. The increase during the first quarter of 1999 provided additional liquidity and collateral available for borrowing and customer repurchase agreements. (see Note 2-- "Investment Securities"). Investment securities held-to-maturity are stated at cost, adjusted for amortization of premium and accretion of discount. Investment securities available-for-sale are stated at fair value. Loans The Company presently is, and in the future expects to remain, a middle market banking organization serving professionals and businesses with interests in and around the Washington, DC metropolitan area. Most of the Company's loan portfolio is collateralized by first mortgages and home equity lines of credit on residential real estate. Although residential real estate loans increased over the past twelve months the Company anticipates that this concentration will decline, as the Company continues its emphasis on the development of new commercial loan business, including commercial real estate loans. Most of the Company's commercial real estate loans are secured by owner-occupied properties with borrowers that are also banking customers of the Company. As of March 31, 1999 and 1998, approximately $85.3 million (68%) and $59.2 million (61%) of the Company's total loan portfolio, respectively, consisted of loans secured by real estate, of which one-to-four family residential mortgage loans and home equity lines of credit represented $36.2 million (29%) and $31.5 million (33%), respectively, of the Company's total loan portfolio.
March 31, -------------------------------------------------- 1999 1998 -------------------------------------------------- Type of loan ( in thousands): $ % $ % -------------------------------------------------- 1-4 family residential mortgage $ 29,612 23.5% $ 24,365 25.3% Home equity loans 6,604 5.2% 7,160 7.4% Multifamily residential 2,903 2.3% 1,851 1.9% Construction 3,566 2.8% 983 1.0% Commercial real estate 42,589 33.8% 24,887 25.8% Commercial loans 30,106 23.9% 25,680 26.7% Installment and credit card loans 10,347 8.2% 10,951 11.4% Other loans 246 0.2% 480 0.5% -------------------------------------------------- Gross loans 125,973 100.0% 96,357 100.0% ------------- ----------- Less: Unearned income 10 58 -------------- ----------- Total loans, net of unearned $ 125,963 96,299 -------------- -----------
-13- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED Asset Quality In originating loans, the Company recognizes that credit losses will be experienced and the risk of loss will vary with, among other things, general economic conditions, the type of loan being made, the creditworthiness of the borrower over the term of the loan and, in the case of a collateralized loan, the quality of the collateral for such loan. The Company maintains an allowance for credit losses based upon, among other things, such factors as historical experience, the volume and type of lending conducted by the Company, the amount of nonperforming assets, regulatory policies, generally accepted accounting principles, general economic conditions, and other factors related to the collectibility of loans in the Company's portfolios. In addition to unallocated allowances, specific allowances are provided for individual loans when ultimate collection is considered questionable by management after reviewing the current status of loans which are contractually past due and after considering the net realizable value of the collateral for the loan. Management actively monitors the Company's asset quality in a continuing effort to charge-off loans against the allowance for loan losses when appropriate and to provide specific loss allowances when necessary. Although management believes it uses the best information available to make determinations with respect to the allowance for credit losses, future adjustments may be necessary if actual economic conditions and other assumptions differ from those used in making the initial determinations. At March 31, 1999, the allowance for credit losses amounted to $1.3 million, or 1.04% of total loans. This represents an increase in the allowance compared to $1.1 million, or 0.98% of total loans as of December 31, 1998. The Company has increased the allowance, as a percentage of total loans ourstanding, to reflect the upward trend in loan charge-offs experienced by the Company over the previous two years. The allowance for credit losses as a percentage of nonperforming loans was 142% at March 31, 1999, compared to 72% at December 31, 1998 and 84% at March 31, 1998. Total nonperforming loans were $968 thousand at March 31, 1999, compared with $1.5 million at December 31, 1998 and $1.2 million at March 31, 1998. Of the $968 thousand in nonperforming loans as of March 31, 1999, approximately $875 thousand (90%) was secured by real estate and other collateral. The remaining $93 thousand in non-performing loans were either unsecured, secured by various business assets, or secured by junior liens on real estate. The commercial loans which are currently nonperforming were originated for the most part during or prior to 1997, and their nonperforming status reflects business and/or personal circumstances unique to each situation, rather than the result of any discernible change in underwriting standards. -14- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED Asset Quality , Continued Provisions for credit losses are charged to income to bring the total allowance for loan losses to a level deemed appropriate by management, based on the factors identified above. The provision for loan losses during the first quarter of 1999 was $180 thousand, representing an increase of $97 thousand or 117% compared to the fourth quarter of 1998. This increase was largely the result of the $10.7 million (9%) increase in loans outstanding during the first quarter of 1999 and the $29.7 million (31%) increase in loans during the past twelve months. These trends, taken into consideration with other factors in the Company's internal analysis of the allowance for credit loss, have led to increased reserve requirements and a resulting increase in the provision expense necessary to maintain the allowance at a level deemed appropriate by management of the Company (see the table on the following page). -15- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED
Nonperforming Loans (in thousands) March 31, -------------------------- 1999 1998 -------------------------- Non-accrual loans $ 721 $ 707 90 days past due 247 461 -------------------------- Total nonperforming loans 968 1,168 Other real estate owned - 52 -------------------------- Total nonperforming assets $ 968 $ 1,220 -------------------------- Nonperforming assets to total assets 0.59% 0.85% -------------------------
Provision and Allowance for Loan Losses (in thousands) Three Months Ended March 31, -------------------------- 1999 1998 -------------------------- Average net loans outstanding $ 118,858 $ 94,262 Loans outstanding at period-end 125,963 96,299 Total nonperforming loans 968 1,168 Beginning balance of allowance $ 1,128 $ 887 Loans charged-off: 1-4 family residential mortgage - - Home equity loans - 1 Commercial loans 6 10 Installment and credit card loans 1 82 -------------------------- Total loans charged off 7 93 Recoveries of previous charge-offs: 1-4 family residential mortgage 1 1 Home equity loans - 2 Commercial loans - - Installment and credit card loans 8 33 -------------------------- Total recoveries 9 36 -------------------------- Net loans charged-off (recoveries) (2) 57 Provision for loan losses 180 193 -------------------------- Balance at end of period $ 1,310 $ 1,023 --------------------------
-16- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED Deposits The Company's total deposits at March 31, 1999 were $138.7 million, an increase of $18.0 million, or 15%, over 1998's first quarter balance, and an increase of $12.4 million, or 10%, compared to 1998's year-end balance. Total average deposits were $127.6 million for the three months ended March 31, 1999, an increase of $2.6 million, or 2%, compared to the first three months of 1998. The Company views deposit growth as a significant challenge in its effort to increase its asset size. Thus, the Company is focusing on its branching program with increased emphasis on commercial accounts, and the offering of more competitive interest rates and products to stimulate deposit growth. This strategy has and will continue to result in a relatively higher cost of funds in addition to lower fee income as many of these commercial customers may utilize accounts with lower transaction costs and have a lower number of transactions than retail customers.
Three Months Ended March 31, ----------------------------------------------------------------------- 1999 1998 ----------------------------------------------------------------------- Weighted- Weighted- Average Average % of Average Average % of Balance Rate Total Balance Rate Total ----------------------------------------------------------------------- (in thousands) Noninterest-Bearing Deposits $ 28,130 0.00% 22.0% $ 22,929 0.00% 18.3% Interest-Bearing Deposits: NOW accounts 19,216 1.29% 15.1% 18,685 2.00% 14.9% Savings accounts 20,680 4.22% 16.2% 17,012 4.60% 13.6% Money market accounts 21,191 3.14% 16.6% 24,198 3.91% 19.4% Time deposits 38,404 5.23% 30.1% 42,202 5.60% 33.8% ------------------------------------------------------------------------- Total $ 127,621 100.0% $ 125,026 100.0% -------------------------------------------------------------------------- Weighted-Average Rate 2.97% 3.57% -------------- --------------
Capital Resources Total stockholders' equity at March 31, 1999 was $15.5 million, an increase of $234 thousand, compared to total stockholders' equity of $15.3 million at December 31, 1998. Stockholders' equity was increased during the current quarter of 1999 by net income of $211 thousand, and by $33 thousand received from the exercise of stock options, and was reduced by $10 thousand attributable to the decline in the market value of investment securities available for sale net of the tax effect. The Office of the Comptroller of the Currency has established certain minimum risk-based capital standards that apply to national banks, and the Company is subject to certain capital requirements imposed by the Federal Reserve Board. At March 31, 1999, Century National Bank exceeded all applicable regulatory capital requirements for classification as a "well capitalized" bank, and the Company satisfied all applicable regulatory requirements imposed on it by the Federal Reserve Board. -17- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED Year 2000 Compliance The "Year 2000 problem" arose because many existing computer programs use only the last two digits to refer to a year. Therefore, these computer programs do not properly recognize a year that begins with "20" instead of the familiar "19." If not corrected, many computer applications could fail or create erroneous results. The extent of the potential impact of the year 2000 problem is not yet known; however, the consequences of the year 2000 problem could have a material effect on the Company's business, results of operations, or financial condition. In December 1997, the Company adopted a year 2000 compliance plan ("Y2K Plan") for the assessment of its exposure to the year 2000 problem, completion of any required remediation, and testing of systems compliance. A specific timetable was established, and a senior officer of the Company was assigned leadership responsibility. The officer reports monthly to the Board of Directors concerning the status of the Y2K Plan, and the Company's progress is also reviewed from time to time by bank regulatory authorities. The Company believes that it is presently on schedule with respect to its Y2K Plan, and outside reviews to date have found the Company's Year 2000 compliance efforts to be satisfactory. As of March 31, 1999 the Company's estimated percentage of completion on its Y2K Plan was 96%, and the estimated date for 100% completion was August 31, 1999. Testing of mission critical systems was completed in November 1998. Testing methodology included copying the entire customer data base onto a Year 2000 compliant (hardware and software) computer system, and utilizing the key Year 2000 dates defined by the FFIEC to test date sensitive transactions and calculations. These tests were performed on all mission critical systems and results revealed compliance or very minor discrepancies were identified; such failed test transactions were tested again in 1999 and the minor discrepancies have been resolved. Material third party risks also include assessing the Year 2000 preparation status of bank borrowing customers. The Company completed a risk assessment of Year 2000 preparedness of borrowers within its loan portfolio as the bank regulatory target date, September 30, 1998, and continues to monitor Y2K preparedness related to new loans and any borrowers deemed to be at high risk. As part of its Y2K Plan, the Company planned to spend approximately $145,000 for the replacement of outdated computer hardware and software. Much of these expenses would have been incurred in the ordinary course of business to maintain such computer systems, regardless of Year 2000 problem considerations. The human resources requirement includes the time of regular Company employees, a network administration consultant, and approximately $20,000 of additional consulting expenses. Because most of the Company's data processing is provided by outside vendors on a contract basis, management does not currently anticipate that the costs to address the Company's year 2000 issues will have a significant impact on the financial position or results of operations of the Company. -18- The Company believes that the most likely worst case scenarios due to the Year 2000 problem could include: (1) lack of liquidity caused by customers' withdrawal of extra cash, (2) increased criminal activity stimulated by public awareness that banks are holding additional cash to avoid liquidity problems, and (3) short term electric power interruptions. The Company is taking steps to establish and renew lines of credit with its correspondent banks and the Federal Home Loan Bank of Atlanta to assure that adequate liquidity will be available to meet the needs of customers. Additional security precautions will be taken to prevent possible crimes due to heightened public awareness of additional cash reserves. The Company does not believe that long term and widespread electric power outages are likely, and has planned to address short term interruptions by training bank management and staff to be ready to provide limited service to customers. The Company is dependent upon the services of EDS in Reston, Virginia, to provide access to customer data bases and other mission critical functions. EDS has back-up service sites available and ready to provide services to the Company should electric power interruptions or other problems occur in the Reston location. The Company has completed the testing of the mission critical systems provided by EDS. The Company does not expect any significant loss in revenue to occur as a result of Year 2000 problems. The Company's Y2K Plan includes certain contingency plans to be implemented in the event compliance benchmarks are not met on a timely basis and/or systems fail to perform in accordance with plans and expectations. For the most part, these contingency plans involve a reversion to manual process for all mission critical business functions, which the Company believes is practical in view of the relative size and scope of its operations. Management and staff will be trained on these procedures and processes prior to July 1999, and additional refresher training will be provided during November and December 1999. -19- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED Liquidity The Company's Asset/Liability Management Policy is intended to maintain adequate liquidity for the Company and thereby enhance its ability to raise funds to support asset growth, meet deposit withdrawals and lending needs, maintain reserve requirements and otherwise sustain operations. The Company accomplishes this primarily through management of the maturities of its interest-earning assets and interest-bearing liabilities. The Company believes that its present liquidity position is adequate to meet its current and future needs. Asset liquidity is provided by cash and assets which are readily marketable, or which can be pledged, or which will mature in the near future. The asset liquidity of the Bank is maintained in the form of vault cash, demand deposits with commercial banks, federal funds sold, interest bearing deposits with other financial institutions, short-term investment securities, other investment securities available-for-sale, and short-term loans. The Company has defined "cash and cash equivalents" as those amounts included in cash and due from banks and federal funds sold. At March 31, 1999, the Company had cash and cash equivalents of $13.6 million, an increase of $408 thousand, when compared with the $13.2 million at December 31, 1998. Liability liquidity is provided by access to core funding sources, principally customers' deposit accounts in the Company's market area. As a member of the Federal Home Loan Bank of Atlanta ("FHLBA"), the Company is authorized to borrow up to $15.1 million secured by a blanket pledge of its portfolio of 1-to-4-family residential mortgage loans and FHLB investment securities. The Company also has lines of credit from larger correspondent banks to borrow excess reserves on an overnight basis (known as "federal funds purchased") in the amount of $4.0 million and to borrow on a secured basis ("repurchase agreements") in the amount of $5.0 million. At March 31, 1999, the Company had no federal funds purchased, $1.5 million in customer repurchase agreements, and was utilizing $6.3 million of its available FHLBA borrowings in the form of fixed-rate term credit advances with an average cost of 6.74%. The Company utilizes fixed rate term credit advances from the FHLBA to fund fixed rate real estate loans of comparable terms and maturities. The Company had cash on hand in the amount of $1.5 million at the holding company level at March 31, 1999. The Company anticipates using these funds as working capital available to support the future growth of the franchise as well as to pay normal operating expenses. Additionally, working capital is further augmented by dividends available from the Bank, subject to certain regulatory restrictions generally applicable to national banks. At March 31, 1999, the Company had no indebtedness outstanding at the holding company level. -20- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The Company's principal market risk exposure is to interest rates. Net interest income, which constitutes the principal source of income for the Company, represents the difference between interest income on interest-earning assets and interest expense on interest-bearing liabilities. The difference between the Company's interest-rate sensitive assets and interest-rate sensitive liabilities for a specified time-frame is referred to as an interest sensitive "gap." Interest rate sensitivity reflects the potential effect on net interest income of a movement in interest rates. A financial institution is considered to be asset sensitive, or having a positive gap, when the amount of its interest-earning assets maturing or repricing exceeds the amount of its interest-bearing liabilities also maturing or repricing within that time period. Conversely, a financial institution is considered to be liability sensitive, or having a negative gap, when the amount of its interest-bearing liabilities maturing or repricing exceeds the amount of its interest-earning assets. During a period of rising (falling) interest rates, a positive gap would tend to increase (decrease) net interest income, while a negative gap would tend to decrease (increase) net interest income. Management seeks to maintain a balanced interest rate risk position to protect its net interest margin from market fluctuations. Toward this end, the Company maintains an Asset/Liability Committee (the "ALCO") which reviews, on a regular basis, the maturity and repricing of the assets and liabilities of the Company. The ALCO has adopted the objective of achieving and maintaining a one-year cumulative GAP, as a percent of total assets, of between plus 10% and minus 10%. In addition, ALCO monitors potential changes in net interest income under various interest rate scenarios. On a consolidated basis, the Company's one year cumulative gap was a positive 0.74% of total assets at March 31, 1999. Market risk is the risk of loss from adverse changes in market prices and rates, arising primarily from interest rate risk in the Company's portfolios, which can significantly impact the Company's profitability and market value of equity. The ALCO has adopted the objective that an immediate increase or decrease of 200 basis points in market interest rate should not result in a change of more than 10% (plus or minus) in the Company's projected net interest income over the next twelve months or in the Company's market value of portfolio equity, and not more than 20% (plus or minus) in projected net income. At March 31, 1999, the forecasted impact of an immediate increase (or decrease)of 200 basis points would have resulted in an increase (or decrease) in net interest income over a twelve month period of (2.6%) and 0.32% respectively, an increase (or decrease) in the market value of portfolio equity of 6.21% and (7.35%) respectively, and an increase (or decrease) in net income over a twelve month period of (10.61%) and 1.30% respecitvely. Since there are limitations inherent in any methodology used to estimate the exposure to changes in market interest rates, the analysis included herein is not intended to be a forecast of the actual effect of a change in market interest rates on the Company. The analysis is based on the Company's assets and liabilities as of March 31, 1999, and does not contemplate any actions the company might undertake in response to changes in market interest rates, which could change the anticipated results. The analysis assumes repricing and/or repayment of all assets and liabilities in accordance with their contractual terms with the exception of (a) mortgage-backed securities, which are assumed to prepay at a rate based on consensus market expectations, and (b) non-maturity customer deposits, which are assumed to respond to interest rate changes on a three-month time-lag basis consistent with the company's historical experience for various types of deposit accounts. -21- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q PART II - OTHER INFORMATION Items 1 through 5. Management notes that no occurrences have taken place during the reporting period which require disclosure under any of the captioned headings. Item 6. Exhibits and Reports on Form 8-K (a) Exhibits. The following exhibit is filed with tis report: Exhibit 27 - Financial Data Schedule, for the quarter ended March 31, 1999 (b) Reports on Form 8-K None. ============================================================================== This report contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Although the Company believes that the expectations reflected in such forward looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed in its Form 10-K dated March 29, 1999, filed with the Securities and Exchange Commission and is incorporated by reference herein (Cautionary Disclosures). Subsequent written and oral forward looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the Cautionary Disclosures. -22- CENTURY BANCSHARES, INC. QUARTERLY REPORT ON FORM 10-Q For Quarter Ended March 31, 1999 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. CENTURY BANCSHARES, INC. Date: May 12, 1999 By: s/b JOSEPH S. BRACEWELL ------------ ------------------------ Joseph S. Bracewell Chairman of the Board, President and Chief Executive Officer Date: May 12, 1999 By: s/b CHARLES V. JOYCE III ------------ -------------------------- Charles V. Joyce III Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) -23- CENTURY BANCSHARES, INC. EXHIBIT INDEX March 31, 1999 The following exhibit is filed with this report. Exhibit Number Description -------------- ------------------------------------------------------ 27 Financial Data Schedule, for the quarter ended March 31, 1999 -24- CENTURY BANCSHARES, Inc. Financial Data Schedule [ARTICLE] 9 [CIK] 785813 [NAME] CENTURY BANCSHARES, INC. [MULTIPLIER] 1,000 [PERIOD-TYPE] 3-MOS [FISCAL-YEAR-END] DEC-31-1999 [PERIOD-END] MAR-31-1999 [CASH] 8,644 [INT-BEARING-DEPOSITS] 8,802 [FED-FUNDS-SOLD] 5,000 [TRADING-ASSETS] - [INVESTMENTS-HELD-FOR-SALE] 9,571 FV [INVESTMENTS-CARRYING] 2,214 BV [INVESTMENTS-MARKET] 2,189 MV [LOANS] 125,963 [ALLOWANCE] 1,310 [TOTAL-ASSETS] 163,755 [DEPOSITS] 138,660 [SHORT-TERM] 1,808 [LIABILITIES-OTHER] 1,426 [LONG-TERM] 6,311 [COMMON] 2,583 [PREFERRED-MANDATORY] - [PREFERRED] - [OTHER-SE] 12,968 163,755 [INTEREST-LOAN] 2,650 [INTEREST-INVEST] 138 [INTEREST-OTHER] 171 [INTEREST-TOTAL] 2,959 935 [INTEREST-EXPENSE] 1,064 [INTEREST-INCOME-NET] 1,895 [LOAN-LOSSES] 180 [SECURITIES-GAINS] - [EXPENSE-OTHER] 1,764 [INCOME-PRETAX] 341 [INCOME-PRE-EXTRAORDINARY] 130 [EXTRAORDINARY] - [CHANGES] - [NET-INCOME] 211 0.08 [EPS-DILUTED] 0.08 [YIELD-ACTUAL] 5.39 [LOANS-NON] 721 [LOANS-PAST] 247 [LOANS-TROUBLED] - [LOANS-PROBLEM] - [ALLOWANCE-OPEN] 1,128 [CHARGE-OFFS] 7 [RECOVERIES] 9 [ALLOWANCE-CLOSE] 1,310 [ALLOWANCE-DOMESTIC] 1,310 [ALLOWANCE-FOREIGN] - [ALLOWANCE-UNALLOCATED] 752 -25- -----END PRIVACY-ENHANCED MESSAGE-----