-----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, H9VnmtUNL3buBHMysdsltj3n46etRJt84VCFmORJrEhlBNTHrgHYEzwpO2JY0w/k 47snsWpzX6BEOqT54GefBw== 0000879635-96-000005.txt : 19960826 0000879635-96-000005.hdr.sgml : 19960826 ACCESSION NUMBER: 0000879635-96-000005 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960808 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: MID PENN BANCORP INC CENTRAL INDEX KEY: 0000879635 STANDARD INDUSTRIAL CLASSIFICATION: 6022 IRS NUMBER: 251666413 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-20141 FILM NUMBER: 96605494 BUSINESS ADDRESS: STREET 1: 349 UNION ST CITY: MILLERSBURG STATE: PA ZIP: 17061 BUSINESS PHONE: 7176922133 MAIL ADDRESS: STREET 2: 349 UNION STREET CITY: MILLERSBURG STATE: PA ZIP: 17061 10-Q 1 MID PENN BANCORP 10-Q PERIOD ENDING JUNE 30, 1996 UNITED STATES 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 the quarterly period ended June 30, 1996 Commission file number 0-20141 Mid Penn Bancorp, Inc. (Exact name of registrant as specified in its charter) Pennsylvania 25-1666413 (State or other jurisdiction of (IRS Employer ID No) Incorporation or Organization) 349 Union Street, Millersburg, PA 17061 (Address of principal executive offices) (Zip Code) (717) 692-2133 (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. [ X ] Yes [ ] No Indicate the number of shares outstanding of each of the classes of common stock, as of the latest practical date. 1,183,105 shares of Common Stock, $1.00 par value per share, were outstanding as of July 18, 1996. MID PENN BANCORP, INC. CONSOLIDATED BALANCE SHEETS (Unaudited; Dollars in thousands)
June 30, Dec. 31, 1996 1995 -------- -------- ASSETS: Cash and due from banks 3,543 3,389 Interest bearing balances 29,642 30,059 Available-for-sale securities 27,417 25,184 Federal funds sold 0 0 Loans 139,177 133,665 Less: Unearned discount 1,825 1,729 Allowance for loan losses 2,150 2,347 ------- ------- Net loans 135,202 129,589 ------- ------- Bank premises and equip't, net 3,543 3,451 Other real estate 215 507 Accrued interest receivable 1,407 1,386 Other assets 1,268 1,146 ------- ------- Total Assets 202,237 194,711 ======= ======= LIABILITIES & STOCKHOLDERS EQUITY: Deposits: Demand 13,023 11,766 NOW 25,287 25,223 Money Market 11,309 10,298 Savings 17,674 17,412 Time 104,284 97,569 ------- ------- Total deposits 171,577 162,268 ------- ------- Short-term borrowings 3,799 4,314 Accrued interest payable 1,412 1,052 Other liabilities 937 1,054 Long-term debt 1,271 3,329 ------- ------- Total Liabilities 178,996 172,017 ------- ------- STOCKHOLDERS' EQUITY: Common stock, par value $1 per share; authorized 10,000,000 shares; issued 1,202,161 shares at June 30, 1996 and December 31, 1995 1,202 1,202 Surplus 9,889 9,889 Undivided profits 12,693 11,788 Unrealized holding gain on securities, net of estimated tax effect -10 348 Less: Treasury Stock at cost (19,056 shares) 533 533 ------- ------- Total Stockholders Equity 23,241 22,694 ------- ------ Total Liabilities & Equity 202,237 194,711 ======= =======
MID PENN BANCORP, INC. CONSOLIDATED STATEMENTS OF INCOME (Unaudited; dollars in thousands)
Three Months Six Months Ended June 30, Ended June 30, 1996 1995 1996 1995 INTEREST INCOME: ----- ----- ----- ----- Interest & fees on loans 3,031 2,835 6,072 5,634 Int.-bearing balances 490 403 1,009 762 Treas. & Agency securities 223 167 417 340 Municipal securities 176 210 357 437 Other securities 17 8 29 16 Fed funds sold and repos 3 14 3 28 ----- ----- ----- ----- Total Int. Income 3,940 3,637 7,887 7,217 ----- ----- ----- ----- INTEREST EXPENSE: Deposits 1,776 1,553 3,540 3,006 Short-term borrowings 41 43 129 64 Long-term borrowings 23 25 60 75 ----- ----- ----- ----- Total Int. Expense 1,840 1,621 3,729 3,145 ----- ----- ----- ----- Net Int. Income 2,100 2,016 4,158 4,072 PROVISION FOR LOAN LOSSES 0 0 0 0 ----- ----- ----- ----- Net Int. Inc. after Prov. 2,100 2,016 4,158 4,072 ----- ----- ----- ----- NON-INTEREST INCOME: Trust Dept 29 24 38 30 Service Chgs. on Deposits 64 59 124 112 Investment sec. gains, net 12 -13 12 13 Other 77 87 188 211 ----- ----- ----- ----- Total Non-Interest Income 182 157 362 366 ----- ----- ----- ----- NON-INTEREST EXPENSE: Salaries and benefits 627 609 1,243 1,186 Occupancy, net 67 27 151 122 Equipment 91 84 180 167 PA Bank Shares tax 57 53 114 110 Other 378 435 729 799 ----- ----- ----- ----- Tot. Non-int. Exp. 1,220 1,208 2,417 2,384 ----- ----- ----- ----- Income before income taxes 1,062 965 2,103 2,054 INCOME TAX EXPENSE 309 257 605 557 ----- ----- ----- ----- NET INCOME 753 708 1,498 1,497 ===== ===== ===== ===== NET INCOME PER SHARE 0.64 0.60 1.27 1.27 ===== ===== ===== ===== Weighted Average No. of Shares Outstanding 1,183,105 1,183,105 1,183,105 1,183,105
MID PENN BANCORP, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited; Dollars in thousands)
For the six months ended: June 30, June 30, 1996 1995 -------- -------- Operating Activities: Net Income 1,498 1,497 Adjustments to reconcile net income to net cash provided by operating activities: Provision for loan losses 0 0 Depreciation 168 149 Change in interest receivable -21 -24 Change in other assets -122 -34 Change in interest payable 360 548 Change in other liabilities 67 -447 Other, net 12 28 ------- ------- Net cash provided by operating activities: 1,962 1,717 ------- ------- Investing Activities: Net decrease in int-bearing balances 417 -2,779 Proceeds from sale of securities 2,570 1,282 Proceeds from the maturity of secs. 1,831 3,665 Purchase of investment securities -7,182 -1,938 Net decrease in loans -5,613 -4,117 Purchase of loans 0 0 Net purchases of fixed assets -260 -707 Proceeds from sale of other real estate 299 181 Capitalized additions - ORE -5 -83 ------- ------- Net cash provided by investing activities -7,943 -4,496 ------- ------- Financing Activities: Net increase in demand and savings 2,594 -4,700 Net increase in time deposits 6,715 8,217 Net increase in sh-term borrowings -515 1,763 Net increase in long-term borrowings -2,058 -2,054 Cash dividend declared -601 -564 ------- ------- Net cash provided by financing activities 6,135 2,662 ------- ------- Net increase in cash & equivalents 154 -117 Cash & cash equivalents, beg of period 3,389 4,764 ------- ------- Cash & cash equivalents, end of period 3,543 4,647 ======= ======= Supplemental Noncash Disclosures: Loan charge-offs 316 148 Transfers to other real estate 0 18
Mid Penn Bancorp, Inc. Notes to Consolidated Financial Statements 1. The consolidated interim financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission with respect to Form 10-Q. The financial information included herein reflects all adjustments (consisting solely of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of results for the interim periods. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures made herein are adequate to make the information not misleading. It is suggested that these interim financial statements be read in conjunction with the financial statements and the notes thereto included in the Company's most recent Form 10-K. 2. Interim statements are subject to possible adjustments in connection with the annual audit of the Company's accounts for the full fiscal year. In the Company's opinion, all adjustments necessary in order to make the interim financial statements not misleading have been included. 3. The results of operations for the interim periods presented are not necessarily indicative of the results expected for the full year. 4. Management considers the Allowance for Loan Losses to be adequate at this time. Mid Penn Bancorp, Inc. Millersburg, Pennsylvania Management's Discussion of Consolidated Financial Condition for the six months ended June 30, 1996 compared to year end 1995 and the Results of Operations for the second quarter and first half of 1996 compared to the same periods in 1995. CONSOLIDATED FINANCIAL CONDITION Total assets as of June 30, 1996, amounted to $202,237,000, an increase of $7,526,000 or 3.9% over the total assets as of December 31, 1995. During 1995, interest rates on short and intermediate term U.S. Treasury Notes and other similar government issues, on average, decreased over 40%. At the end of 1995, there was considerable discussion about the Federal Reserve further lowering interest rates in 1996, and the discount rate was lowered on January 31, 1996, from 5.25% to 5.00%. In anticipation of the possibility that short term interest rates would continue to fall in 1996, during January $3,275,000 in interest bearing balances from other institutions was purchased. Although the focus in the beginning of 1996 was that interest rates would decline further, the actual results were opposite. At the end of June, the interest rate on the one-year U.S. Treasury Note was up 12.6% from December 31, 1995, while the two-year note was up 18.3%, and the five year note was up 20.1%. The Bank added $2,900,000 in U.S. Treasury and Agency investments to its portfolio during the first half of 1996 as these securities offered more attractive yields than interest bearing balances of similar terms. As a net result, interest-bearing balances from other institutions decreased $417,000 from December 31, 1995 to June 30, 1996. Interest bearing balances with other financial institutions are fully insured by the FDIC and provide liquidity while offering a competitive return. Although there was considerable discussion with potential borrowers during the first quarter, loan demand continues to be sporadic. The Bank increased net loans by $5,600,000 or 4.3% during the first six months of 1996. The banking industry continues to aggressively pursue borrowers by offering very competitive interest rates for extended periods of time. Foreclosed assets held for sale decreased $292,000 to $215,000 during the first half of 1996. The sale of a $200,000 commercial property greatly contributed to the decrease. As of June 30, 1996, the balance of foreclosed assets held for sale consists of undeveloped land. Total deposits increased by $9,309,000, or 5.7% from $162,268,000 at December 31, 1995, to $171,577,000 at June 30, 1996. Time deposits, which increased $6,715,000 to $104,284,000 at June 30, 1996, from $97,569,000 at December 31, 1995, accounted for the majority of the increase. Long term debt decreased substantially from $3,329,000 at December 31, 1995 to $1,271,000 at June 30, 1996. The decrease resulted from the February maturity and subsequent repayment of a $2,000,000 borrowing from the Federal Home Loan Bank of Pittsburgh. The note was originally replaced by a 30-day short term note that has since been repaid with cash from operations and funds generated by increased deposits. RESULTS OF OPERATION Net income for the second quarter was $753,000, a $45,000 or 6.4% increase from the $708,000 earned in the same quarter of 1995, while net income for the first six months was $1,498,000 compared to the $1,497,000 earned in the like period of 1995. Net income per share for the six months ended June 30, 1996, remained constant with that for the six months ended June 30, 1995, at $1.27 per share. Net income on an annualized basis at June 30, 1996, as a percent of total average assets, also known as return on assets (ROA) was 1.5% as compared to 1.7% for the same period in 1995. Net income as a percentage of stockholders' equity, also known as return on equity, (ROE), was 13.0% on an annualized basis for the first half of 1996 as compared to 14.0% for the same period in 1995. Net interest income as of June 30, 1996, was $2,100,000 as compared to $2,016,000 for the second quarter of 1995. The national prime rate, the rate used by the Bank as its index to price most of its short-term variable rate commercial loans, decreased from 9.00% at the end of March 1995 to 8.25%, the prime rate at June 30, 1996. As a result, the annualized rate of interest income on average earning assets decreased to 8.6% at June 30, 1996, from 8.7% at June 30, 1995. With most of the growth in deposits being in the more costly time deposits, the annualized rate of interest expense on average costing liabilities increased from 4.4% at the end of June 1995 to 4.6% at June 30, 1996. The growth in net interest income between the second quarter of 1996 and the second quarter of 1995 was the result of volume as opposed to yield. The net interest margin on average earning assets was 4.6% at June 30, 1996, as compared to 5.0% at June 30, 1995. The Bank made no provision for loan losses during the first half of 1996 or the same period in 1995. On a quarterly basis, senior management reviews potentially unsound loans. Taking into consideration judgments regarding risk or error, economic conditions, trends and other factors, management determined that no provision for loan losses was necessary during the first two quarters of 1996. Non-interest income remained fairly constant at $362,000 for the first half of 1996 as compared to $366,000 for the same period of 1995. A significant contribution to non-interest income is NSF fee income. NSF fee income contributed in excess of $94,000 during the first six months of 1996. Non-interest expense increased by $33,000 from $2,384,000 at June 30, 1995, to $2,417,000 at June 30, 1996. A major factor contributing to the increase was an increase in salaries and employee benefits expense. Due largely to the opening of the Carlisle Pike Office in late September of 1995, the number of full-time equivalent employees increased to 84 at June 30, 1996, as compared to 77 at June 30, 1995. Other non-interest expense decreased from $799,000 at June 30, 1995, to $729,000 at June 30, 1996. The significant factor resulting in the decrease was the FDIC insurance premium. Being a well-capitalized institution, the Bank was assigned an assessment rating of 1A for the period January 1, 1996, through June 30, 1996, resulting in the Bank being assessed the minimum assessment of $1000 for the period. During the same period of 1995, FDIC expense amounted to $166,000. LIQUIDITY The Bank's objective is to maintain adequate liquidity while minimizing interest rate risk. Adequate liquidity provides resources for credit needs of borrowers, for depositor withdrawals, and for funding Corporate operations. Sources of liquidity include maturing investment securities, overnight borrowings of federal funds (and Flex Line), payments received on loans, and increases in deposit liabilities. Funds generated from operations contributed a major source of funds for the first six months of 1996. Another major source of funds came from the net increase in time deposits, which contributed $6,715,000 during the half, while net demand and savings balances increased by $2,594,000. The majority of these deposit increases took place at our newest branch office which was opened in September of 1995. Deposits at this Mechanicsburg (Carlisle Pike) Office increased by $3,249,000 during the first half of 1996. The major uses of funds during the six months included a net increase in investment securities of $2,781,000. Even in an environment of strong competition among banks for commercial loans, the Bank achieved a net increase of $5,613,000 in net loans during the first six months of 1996. Also during the first half, a $2,000,000 borrowing from the Federal Home Loan Bank of Pittsburgh matured and was subsequently repaid with generated funds. CREDIT RISK AND ALLOWANCE FOR LOAN LOSSES The total of non-accrual loans decreased by $109,000 or 6.2% from December 31, 1995. Most non-performing assets are supported by collateral value that appears to be adequate at June 30, 1996. The balance of loans past due 90 days or more increased by $4,000 to $199,000 from December 31, 1995, to June 30, 1996. This represents a 2.1% increase. The Allowance for Loan Losses at June 30, 1996, was $2,150,000 or 1.57% of loans, net of unearned interest, as compared to $2,347,000 or 1.78% of loans, net of unearned interest, at December 31, 1995. Based upon the ongoing analysis of the Bank's loan portfolio by the loan review department, the latest quarterly analysis of potentially unsound loans and non-performing assets, Management considers the Allowance for Loan Losses to be adequate to absorb any reasonable, foreseeable loan losses. MID PENN BANCORP, INC.
June 30, June 30, 1996 1995 -------- -------- Non-Performing Assets: Non-accrual loans 1,644 1,753 Past due 90 days or more 199 195 Restructured loans 877 0 ------- ------- Total non-performing loans 2,720 1,948 Other real estate 215 507 ------- ------- Total 2,935 2,455 ======= ======= Percentage of total loans outstanding 2.11 1.84 Percentage of total assets 1.45 1.26 Analysis of the Allowance for Loan Losses: Balance beginning of period 2,347 2,511 Loans charged off: Commercial real estate, construction and land development 0 86 Commercial, industrial and agricultural 167 54 Real estate - residential mortgage 0 0 Consumer 149 226 ------- ------- Total loans charged off 316 366 ------- ------- Recoveries of loans previously charged off: Commercial real estate, construction and land development 10 33 Commercial, industrial and agricultural 70 110 Real estate - residential mortgage 3 4 Consumer 36 55 ------- ------- Total recoveries 119 202 ------- ------- Net charge-offs (recoveries) 197 164 ------- ------- Current period provision for loan losses 0 0 ------- ------- Balance end of period 2,150 2,347 ======= ======
Mid Penn Bancorp, Inc. PART II - OTHER INFORMATION: Item 1. Legal Proceedings - Nothing to report Item 2. Changes in Securities - Nothing to report Item 3. Defaults Upon Senior Securities - Nothing to report Item 4. Submission of Matters to a Vote of Security Holders - - - At the Annual Meeting of Shareholders held on April 23, 1996, a vote was held for the election of Class A directors: Warren A. Miller, Charles R. Phillips, Edwin D. Schlegel and Eugene F. Shaffer to serve for a three year term, and to ratify the selection of Parente, Randolph, Orlando, Carey and Associates as external auditors for the corporation for the year ending December 31, 1996. Warren A. Miller received 962,058.2059 votes for and 30,636.5506 votes withheld. Charles R. Phillips received 961,475.0116 votes for and 31,219.7449 votes withheld. Edwin D. Schlegel received 962,563.1154 votes for and 30,131.6411 votes withheld. And Eugene F. Shaffer received 962,854.7565 votes for and 29,840 votes withheld. The selection of external auditors received 957,379.1608 votes for, 1,831.4095 votes against, and 33,484.1862 votes abstaining. Item 5. Other Information - Nothing to report Item 6. Exhibits and Reports on Form 8-K a. Exhibits - (27) Financial Data Schedule b. Reports on Form 8-K - None 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. Mid Penn Bancorp, Inc. Registrant /s/ Eugene F. Shaffer /s/ Gerald D. Schoffstall By:Eugene F. Shaffer By:Gerald D. Schoffstall Chairman, Pres. & CEO Treasurer Date: August 2, 1996 Date: August 2, 1996 EX-27 2
9 1000 6-MOS DEC-31-1996 JUN-30-1996 3,543 29,642 0 0 27,417 0 0 137,352 2,150 202,237 171,577 3,799 2,349 1,271 0 0 1,202 22,039 202,237 6,072 1,812 3 7,887 3,540 3,729 4,158 0 12 2,417 2,103 2,103 0 0 1,498 1.27 1.27 8.6 1,644 199 877 921 2,347 316 119 2,150 0 0 0
-----END PRIVACY-ENHANCED MESSAGE-----