-----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, OEsniT7Cj2X5b6ExMxz3pgNrluGUhWb7xQx8fmU9SKKDBNwryfFibFO3qcZVWpep eFJHVLYIAOltKYa7NVIYIA== 0000921085-99-000011.txt : 19990817 0000921085-99-000011.hdr.sgml : 19990817 ACCESSION NUMBER: 0000921085-99-000011 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990630 FILED AS OF DATE: 19990816 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CENTRAL COAST BANCORP CENTRAL INDEX KEY: 0000921085 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 770367061 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-25418 FILM NUMBER: 99690025 BUSINESS ADDRESS: STREET 1: 301 MAIN ST CITY: SALINAS STATE: CA ZIP: 93901 BUSINESS PHONE: 4084226642 MAIL ADDRESS: STREET 1: P O BOX 450 CITY: SALINAS STATE: CA ZIP: 93902 FORMER COMPANY: FORMER CONFORMED NAME: SALINAS VALLEY BANCORP DATE OF NAME CHANGE: 19940330 10-Q 1 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q [x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 30, 1999 . [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File No. 0-25418 . ---------- CENTRAL COAST BANCORP - ---------------------------------------------------------------------- (Exact name of registrant as specified in its charter) California 77-0367061 - -------------------------------- ---------------------- (State or other jurisdiction of (IRS Employer ID Number) incorporation or organization) 301 Main Street, Salinas, California. 93901 . - ----------------------------------------- --------- (Address of principal executive offices) (Zip code) (831) 422-6642 . ----------------------------- (Registrants 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 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__ N0____ Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: No par value Common Stock - 6,456,255 shares outstanding at July 29, 1999. Page 1 of 26 The Index to the Exhibits is located at Page 24
PART 1-FINANCIAL INFORMATION Item 1. FINANCIAL STATEMENTS: CENTRAL COAST BANCORP AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited) June 30, 1999 December 31, 1998 ----------- ------------ (In thousands) Assets Cash and due from banks $ 48,052 $ 44,684 Federal funds sold - 4,202 -------------- ------------- Total cash and equivalents 48,052 48,886 Available-for-sale securities 156,704 170,387 Loans held for sale 5,324 6,168 Loans: Commercial 140,039 136,685 Real estate-construction 27,036 19,929 Real estate-other 177,817 144,685 Installment 11,110 11,545 Deferred loan fees, net (914) (674) -------------- ------------- Total loans 355,088 312,170 Allowance for loan losses (4,882) (4,352) -------------- ------------- Net Loans 350,206 307,818 -------------- ------------- Premises and equipment, net 3,156 3,069 Accrued interest receivable and other assets 9,311 7,605 -------------- ------------- Total assets $ 572,753 $ 543,933 ============== ============= Liabilities and Shareholders' Equity Deposits: Demand, noninterest bearing $ 130,226 $ 149,757 Demand, interest bearing 108,578 98,226 Savings 106,389 104,447 Time 158,979 136,762 -------------- ------------- Total Deposits 504,172 489,192 Accrued interest payable and other liabilities 16,914 3,542 -------------- ------------- Total liabilities 521,086 492,734 -------------- ------------- Commitments and contingencies (Note 2) Shareholders Equity: Preferred stock-no par value; authorized 1,000,000 shares; no shares issued Common stock - no par value; authorized 25,000,000 shares; issued and outstanding: 6,477,369 shares at June 30, 1999 and 6,112,045 shares at December 31, 1998 40,141 41,103 Shares held in deferred compensation trust (247,148 at June 30, 1999 and 71,949 at December 31,1998), net of deferred obligation - - Retained earnings 13,451 9,733 Accumulated other comprehensive income - net of taxes of $1,338,000 at June 30,1999 and $254,000 at December 31, 1998 (1,925) 363 -------------- ------------- Shareholders' equity 51,667 51,199 -------------- ------------- Total liabilities and shareholders' equity $ 572,753 $ 543,933 ============== ============= See Notes to Consolidated Condensed Financial Statements
CENTRAL COAST BANCORP AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Unaudited) Three months ended June 30, Six months ended June 30, (In thousands) 1999 1998 1999 1998 Interest Income Loans (including fees) $ 7,686 $ 6,669 $ 14,827 $ 12,936 Investment securities 2,343 2,027 4,591 3,807 Other 2 585 75 1,530 --------------- --------------- ---------------- ----------------- Total interest income 10,031 9,281 19,493 18,273 --------------- --------------- ---------------- ----------------- Interest Expense Interest on deposits 3,180 3,415 6,266 6,750 Other 149 - 176 - --------------- --------------- ---------------- ----------------- Total interest expense 3,329 3,415 6,442 6,750 --------------- --------------- ---------------- ----------------- Net Interest Income 6,702 5,866 13,051 11,523 Provision for Loan Losses 410 24 537 41 --------------- --------------- ---------------- ----------------- Net Interest Income after Provision for Loan Losses 6,292 5,842 12,514 11,482 --------------- --------------- ---------------- ----------------- Noninterest Income 591 530 1,133 924 --------------- --------------- ---------------- ----------------- Noninterest Expenses Salaries and benefits 2,250 2,053 4,581 4,208 Occupancy 297 273 577 492 Furniture and equipment 294 235 585 430 Other 983 897 1,904 1,780 --------------- --------------- ---------------- ----------------- Total noninterest expenses 3,824 3,458 7,647 6,910 --------------- --------------- ---------------- ----------------- Income Before Income Taxes 3,059 2,914 6,000 5,496 Provision for Income Taxes 1,065 1,205 2,281 2,273 --------------- --------------- ---------------- ----------------- Net Income $ 1,994 $ 1,709 $ 3,719 $ 3,223 =============== =============== ================ ================= Basic Earnings per Share $ 0.30 $ 0.28 $ 0.58 $ 0.54 Diluted Earnings per Share $ 0.29 $ 0.26 $ 0.55 $ 0.49 See Notes to Consolidated Condensed Financial Statements
CENTRAL COAST BANCORP AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands) Six months ended June 30, 1999 1998 -------- ------- Cash Flows from Operations: Net income $ 3,719 $ 3,223 Reconciliation of net income to net cash provided by operating activities: Provision for loan losses 537 41 Net gain (loss) on sale of fixed assets 61 (1) Writedown (gain on sale) of other real estate owned 90 (21) Depreciation 403 278 Amortization and accretion 3 (52) Increase in accrued interest receivable and other assets (64) (762) Increase in accrued interest payable and other liabilities 965 366 Decrease in deferred loan fees 240 2 --------- -------- Net cash provided by operations 5,954 3,074 --------- -------- Cash Flows from Investing Activities: Purchases of investment securities (88,912) (72,237) Proceeds from maturities of investment securities 92,854 72,040 Proceeds from sale of investment securities 5,987 - Net (increase) decrease in loans held for sale 844 (3,008) Net (increase) in loans (43,165) (16,550) Proceeds from sale of other real estate owned - 126 Proceeds from sale of fixed assets - 1 Capital expenditures (821) (731) --------- -------- Net cash used in investing activities (33,213) (20,359) --------- -------- Cash Flows from Financing Activities: Net increase in deposit accounts 14,979 502 Net increase (decrease) in short-term borrowings 12,408 (124) Proceeds from sale of stock 1,098 136 Shares repurchased (2,060) (12) --------- -------- Net cash provided by financing activities 26,425 502 --------- -------- Net increase (decrease) in cash and equivalents (834) (16,783) Cash and equivalents, beginning of period 48,886 104,597 --------- -------- Cash and equivalents, end of period $48,052 $87,814 ========= ======== Other Cash Flow Information: Interest paid $ 6,417 $ 6,712 Income taxes paid 1,589 1,125 See Notes to Consolidated Condensed Financial Statements
CENTRAL COAST BANCORP AND SUBSIDIARIES NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS June 30, 1999 (Unaudited) 1. CONSOLIDATED FINANCIAL STATEMENTS In the opinion of Management, the unaudited consolidated condensed financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the Company's consolidated financial position at June 30, 1999 and December 31, 1998, the results of operations for the three and six month periods ended June 30, 1999 and 1998, and cash flows for the six month periods ended June 30, 1999 and 1998. Certain disclosures normally presented in the notes to the annual financial statements prepared in accordance with generally accepted accounting principles have been omitted. These interim consolidated condensed financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's 1998 Annual Report to Shareholders. The results of operations for the three and six month periods ended June 30, 1999 and 1998 may not necessarily be indicative of the operating results for the full year. In preparing such financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and revenues and expenses for the period. Actual results could differ significantly from those estimates. Material estimates that are particularly susceptible to significant changes in the near term relate to the determination of the allowance for loan losses and the carrying value of other real estate owned. Management uses information provided by an independent loan review service in connection with the determination of the allowance for loan losses. 2. COMMITMENTS AND CONTINGENCIES In the normal course of business there are outstanding various commitments to extend credit which are not reflected in the financial statements, including loan commitments of approximately $130,722,000 and standby letters of credit of $2,083,000 at June 30, 1999. However, all such commitments will not necessarily culminate in actual extensions of credit by the Company during 1999. Approximately $31,474,000 of loan commitments outstanding at June 30, 1999 relate to real estate construction loans and are expected to fund within the next twelve months. The remainder relate primarily to revolving lines of credit or other commercial loans, and many of these commitments are expected to expire without being drawn upon. Therefore, the total commitments do not necessarily represent future cash requirements. Each potential borrower and the necessary collateral are evaluated on an individual basis. Collateral varies, but may include real property, bank deposits, debt or equity securities or business assets. Stand-by letters of credit are commitments written to guarantee the performance of a customer to a third party. These guarantees are issued primarily relating to purchases of inventory by commercial customers and are typically short-term in nature. Credit risk is similar to that involved in extending loan commitments to customers and accordingly, evaluation and collateral requirements similar to those for loan commitments are used. Virtually all such commitments are collateralized. 3. EARNINGS PER SHARE COMPUTATION Basic earnings per share is computed by dividing net income by the weighted average common shares outstanding for the period (6,493,000 and 6,410,000 for the three and six month periods ended June 30, 1999, and 6,025,000 and 6,016,000 for the three and six month periods ended June 30, 1998). Diluted earnings per share reflects the potential dilution that could occur if outstanding stock options and stock purchase warrants were exercised. Diluted earnings per share is computed by dividing net income by the weighted average common shares outstanding for the period plus the dilutive effect of options and warrants (185,000 and 255,000 for the three and six month periods ended June 30, 1999 and 590,000 and 524,000 for the three and six month periods ended June 30, 1998). 4. COMPREHENSIVE EARNINGS In 1998, Central Coast Bancorp adopted Statement of Financial Accounting Standards No. 130, "Reporting Comprehensive Income", which requires that an enterprise report, by major components and as a single total, the change in net assets during the period from nonowner sources. Such amounts are as follows:
Three Months Ended June 30, Six Months Ended June 30, (In thousands) 1999 1998 1999 1998 ---- ---- ---- ---- Net Earnings $ 1,994 $ 1,709 $ 3,719 $ 3,223 Other comprehensive income (loss)- Net unrealized gain on available-for-sale securities (1,504) 230 (2,296) 115 Reclassification adjustment for gains included in income, net of taxes of $4,000 and $(13,000) for the three and six month periods ended June 30, 1999. (5) - 8 - -------------- -------------- ------------- -------------- Total comprehensive earnings $ 485 $ 1,939 $ 1,431 $ 3,338 ============== ============== ============= ==============
5. STOCK SPLIT On January 25, 1999 the Board of Directors declared a five-for-four stock split, which was distributed on February 26, 1999, to shareholders of record as of February 8, 1999. All share and per share data have been retroactively adjusted to reflect the stock split. Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS In addition to the historical information contained herein, this report on Form 10-Q contains certain forward-looking statements. The reader of this report should understand that all such forward-looking statements are subject to various uncertainties and risks that could affect their outcome. The Company's actual results could differ materially from those suggested by such forward-looking statements. Changes to such risks and uncertainties, which could impact future financial performance, include, among others: (1) competitive pressures in the banking industry; (2) changes in the interest rate environment; (3) general economic conditions, nationally, regionally and in the operating market areas of the Company and the Banks; (4) changes in the regulatory environment; (5) changes in business conditions and inflation; (6) changes in securities markets; and (7) effects of possible Year 2000 problems. This entire report should be read to put such forward-looking statements in context. To gain a more complete understanding of the uncertainties and risks involved in the Company's business this report should be read in conjunction with Central Coast Bancorp's annual report on Form 10-K for the year ended December 31, 1998. Interest income and net interest income are presented on a fully taxable equivalent basis (FTE) within the Management's Discussion and Analysis. Business Organization Central Coast Bancorp (Nasdaq symbol CCBN) (the "Company") is a California corporation organized in 1994, and is the parent company Bank of Salinas and Cypress Bank, state-chartered banks, headquartered in Salinas and Seaside, California, respectively (the ("Banks"). Other than its investment in the Banks, the Company currently conducts no other significant business activities, although it is authorized to engage in a variety of activities which are deemed closely related to the business of banking upon prior approval of the Board of Governors of the Federal Reserve System (the"FRB"), the Company's principal regulator. The Banks offer a full range of commercial banking services, including a diverse range of traditional banking products and services to individuals, merchants, small and medium-sized businesses, professionals and agribusiness enterprises located in the Salinas Valley and Monterey Peninsula. Overview The Company reported record quarterly net income of $1,994,000 for the quarter ended June 30, 1999. This represents a 16.7% increase over the $1,709,000 reported for the same period of 1998. Diluted earnings per share for the respective quarters were $0.30 versus $0.26. The return on equity (ROE) and the return on assets (ROA) for the second quarter 1999 were 15.2% and 1.45% as compared to 14.8% and 1.40% for the same period in 1998. Net income for the six months ended June 30, 1999 and 1998 was $3,719,000 and $3,223,000 with diluted earnings per share of $0.56 and $0.49, respectively. For the first six months of 1999 ROE was 14.4% and ROA was 1.39%, as compared to 14.3% and 1.33% for the same period in 1998. The earnings per share for the 1998 periods have been adjusted for the 5 for 4 stock split distributed on February 26, 1999. Year over year internal growth was strong, as assets of the Company increased $70,873,000 (14.1%) to total $572,753,000 at June 30, 1999. Loans totaled $360,412,000, up $84,067,000 (30.4%) from the ending balances on June 30, 1998. Deposit growth in the like period, excluding $20,000,000 of State of California certificates of deposit, was 7.4% with ending deposit balances at $504,171,000. The strong second quarter earnings reflect the results of continuing loan demand, restructuring the investment portfolio during the past year and improved operating efficiency. The following table provides a summary of the major elements of income and expense for the periods indicated. Condensed Comparative Income Statement
Percentage Percentage Three monts ended Change Six months ended Change June 30, Increase June 30, Increase (In thousands) 1999 1998 (Decrease) 1999 1998 (Decrease) ---- ---- ---------- ---- ---- ---------- Interest income (1) $10,229 $9,296 10% $19,867 $18,303 9% Interest expense 3,329 3,415 -3% 6,442 6,750 -5% -------- ------- --------- --------- -------- --------- Net interest income 6,900 5,881 17% 13,425 11,553 16% Provision for loan losses 410 24 1608% 537 41 1210% -------- ------- --------- --------- -------- --------- Net interest income after provision for loan losses 6,490 5,857 11% 12,888 11,512 12% Noninterest income 591 530 12% 1,133 924 23% Noninterest expense 3,824 3,458 11% 7,647 6,910 11% -------- ------- --------- --------- -------- --------- Net income before income taxes 3,257 2,929 11% 6,374 5,526 15% Tax equivalent adjustment 198 15 1220% 374 30 1147% Income taxes 1,065 1,205 -12% 2,281 2,273 0% -------- ------- --------- --------- -------- --------- Net income $1,994 $1,709 17% $3,719 $3,223 15% ======== ======= ========= ========= ======== ========= 1) Interest on tax-free securities is reported on tax equivalent basis.
Net interest income / net interest margin Net interest income, the difference between interest earned on loans and investments and interest paid on deposits and other borrowings, is the principal component of the Banks' earnings. Net interest margin is net interest income expressed as a percentage of average earning assets. Second quarter 1999 net interest income of $6,900,000 was a 17.3% increase of $1,019,000 over the same period in 1998. Interest income was up $933,000 (10.0%). Average loan balances were $73,547,000 (27.8%) higher in the second quarter of 1999 versus the year earlier period. This volume difference added $1,852,000 to interest income. It was offset in part by a 100 basis point decrease in loan yields, which reduced interest income by $835,000. The rate decrease was the result of the three 25 basis point downward adjustments in the second half of 1998 and a competitive rate environment. Average balances for investment securities and Federal funds sold decreased $15,372,000 to $161,539,000. Due to repositioning of the investment portfolio, interest income related to investments and Federal funds sold decreased $84,000 in the second quarter of 1999 versus the year earlier period. For the three months ended June 30, 1999, interest expense was down $86,000 (2.5%) from the year earlier quarter. Increased interest expense of $366,000 resulting from higher average balances in interest bearing liabilities during the second quarter of 1999 versus the year earlier period was offset by a 50 basis point decrease in average rates paid which decreased interest expense $452,000. Net interest margin for the second quarters of 1999 and 1998 were 5.5% and 5.3%, respectively. For the first six-month period of 1999, interest income increased $1,564,000 to $19,867,000. Average balances of both loans and investment securities were higher in 1999. These higher balances added $4,865,000 to interest income. The average balance in Federal funds sold was lower by $53,323,000 in the first six months of 1999 versus the prior year. Interest income derived from Federal funds sold consequently was $1,455,000 lower in the period. The average yield on loans was 100 basis lower in the 1999 six-month period due to the downward rate adjustments and competitive rate environment discussed in the quarterly results paragraph above. The lower yields reduced interest income by $1,601,000. The average yields received on all earning assets for the first six months of 1999 was 8.2% as compared to 8.4% for the same period in 1998. Interest expense for the six-month period decreased $308,000 (4.6%) from the expense in the same 1998 period. Volume increases in deposits and borrowings added $586,000 of interest expense. The volume increases were more than offset by lower rates. Overall average rates paid on interest-bearing liabilities in the first six months of 1999 decreased 50 basis points to 3.6% from the same period in 1998. The decrease attributable to the lower rates was $894,000. The combined effect of the increase in interest income coupled with the decrease in interest expense for the six-month period ending June 30, 1999, resulted in an increase in net interest income of $1,872,000 or 16.2% as compared to the first six months of 1998. Net interest margin rose 20 basis points to 5.5%. The first two following tables provide a summary of the components of net interest income and the changes within the components for the periods indicated. The second two tables set forth a summary of the changes in interest income and interest expense from changes in average asset and liability balances (volume) and changes in average interest rates.
(Unaudited) Three months ended June 30 (Taxable Equivalent Basis) 1999 1998 Avg. Avg. Avg. Avg. (In thousands, except percentages) Balance Interest Yield Balance Interest Yield ------- -------- ------ ------- -------- ----- Assets: Earning Assets Loans (1) (2) $338,094 $7,686 9.1% $264,547 $6,669 10.1% Taxable investments 125,300 1,951 6.2% 131,703 1,998 6.1% Tax-exempt securities (tax equivalent basis) 35,903 590 6.6% 2,089 44 8.4% Federal funds sold 336 2 2.4% 43,119 585 5.4% -------- -------- ------- ------ Total Earning Assets 499,633 $10,229 8.2% 441,458 $9,296 8.4% -------- ------ Cash & due from banks 41,023 38,502 Other assets 12,446 10,787 --------- ------- $553,102 $490,747 ========= ======== Liabilities & Shareholders' Equity: Interest bearing liabilities: Demand deposits $102,864 $ 457 1.8% $86,377 $ 416 1.9% Savings 101,001 816 3.2% 97,424 925 3.8% Time deposits 156,071 1,907 4.9% 148,518 2,074 5.6% Other borrowings 12,264 149 4.9% - - n/a -------- ------ -------- ------ Total interest bearing liabilities 372,200 3,329 3.6% 332,319 3,415 4.1% Demand deposits 123,985 ------ 108,111 ------ Other Liabilities 4,311 4,036 -------- -------- Total Liabilities 500,496 444,466 Shareholders' Equity 52,606 46,281 -------- -------- $553,102 $490,747 ======== ======== Net interest income & margin (3) $6,900 5.5% $5,881 5.3% ====== ==== ====== ====
(1) Loan interest income includes fee income of $307,000 and $262,000 for the three month period June 30, 1999 and 1998, respectively. (2) Includes the average allowance for loan losses of $4,536,000 and $4,206,000 and average deferred loan fees of $853,000 and $528,000 for the three months ended June 30, 1999 and 1998, respectively. (2) Net interest margin is computed by dividing net interest income by the total average earning assets.
(Unaudited) Six months ended June 30, (Taxable Equivalent Basis) 1999 1998 Avg Avg Avg Avg (In thousands, except percentages) Balance Interest Yield Balance Interest Yield ------- -------- ----- ------- -------- ----- Assets: Earning Assets Loans (1) (2) $324,069 $14,827 9.2% $255,039 $12,936 10.2% Taxable investments 126,377 3,844 6.1% 125,593 3,748 6.0% Tax-exempt securities (tax equivalent basis) 34,118 1,121 6.6% 2,089 89 8.5% Federal funds sold 3,267 75 4.6% 56,590 1,530 5.5% -------- -------- --------- ------- Total Earning Assets 487,831 $19,867 8.2% 439,311 $18,303 8.4% Cash & due from banks 41,708 -------- 38,112 ------- Other assets 11,677 10,446 --------- --------- $541,216 $487,869 ========= ========= Liabilities & Shareholders' Equity: Interest bearing liabilities: Demand deposits $97,974 $ 812 1.7% $86,486 $ 837 2.0% Savings 104,901 1,706 3.3% 98,492 1,867 3.8% Time deposits 151,585 3,748 5.0% 145,289 4,046 5.6% Other borrowings 7,222 176 4.9% - - n/a -------- ----- ------- ----- Total interest bearing liabilities 361,682 6,442 3.6% 330,267 6,750 4.1% Demand deposits 123,125 ----- 108,344 ----- Other Liabilities 4,232 3,705 -------- ------- Total Liabilities 489,039 442,316 Shareholders' Equity 52,177 45,553 -------- -------- $541,216 $487,869 ======== ======== Net interest income & margin (3) $13,425 5.5% $11,553 5.3% ======= ==== ======= ====
(1) Loan interest income includes fee income of $548,000 and $506,000 for the six month periods ended June 30, 1999 and 1998, respectively. (2) Includes the average allowance for loan losses of $4,452,000 and $4,207,000 and average deferred loan fees of $786,000 and $538,000 for the six months ended June 30, 1999 and 1998, respectively. (3) Net interest margin is computed by dividing net interest income by the total average earning assets.
Volume/Rate Analysis (in thousands) Three Months Ended June 30, 1999 over 1998 Increase (decrease) due to change in: Net Volume Rate (4) Change ------ -------- ------ Interest-earning assets: Net Loans (1)(2) $ 1,852 $(835) $1,017 Taxable investment securities (97) 50 (47) Tax exempt investment securities (3) 708 (162) 546 Federal funds sold (576) (7) (583) -------- ------ ------- Total 1,887 (954) 933 -------- ------ ------- Interest-bearing liabilities: Demand deposits 78 (37) 41 Savings deposits 34 (143) (109) Time deposits 105 (272) (167) Other borrowings 149 - 149 -------- ------ ------ Total 366 (452) (86) -------- ------ ------ Interest differential $ 1,521 $(502) $1,019 ======== ====== =======
(1) The average balance of non-accruing loans is immaterial as a percentage of total loans and, as such, has been included in net loans. (2) Loan fees of $307,000 and $262,000 for the three months ended June 30, 1999 and 1998, respectively, have been included in the interest income computation. (3) Includes taxable-equivalent adjustments that relate to income on certain securities that is exempt from federal income taxes. The effective federal statutory tax rate was 34% for 1999 and 1998. (4) The rate / volume variance has been included in the rate variance.
Volume/Rate Analysis (in thousands) Six Months Ended June 30, 1999 over 1998 Increase (decrease) due to change in: Net Volume Rate (4) Change ------ ------- ------ Interest-earning assets: Net Loans (1)(2) $3,492 $ (1,601) $ 1,891 Taxable investment securities 23 73 96 Tax exempt investment securities (3) 1,350 (318) 1,032 Federal funds sold (1,454) (1) (1,455) ------- --------- -------- Total 3,411 (1,847) 1,564 ------- --------- -------- Interest-bearing liabilities: Demand deposits 114 (139) (25) Savings deposits 121 (282) (161) Time deposits 175 (473) (298) Other borrowings 176 - 176 ------- --------- -------- Total 586 (894) (308) ------- --------- -------- Interest differential $2,825 $ (953) $ 1,872 ======= ========= ========
(1) The average balance of non-accruing loans is immaterial as a 1percentage of total loans and, as such, has been included net loans. (2) Loan fees of $548,000 and $506,000 for the six months ended June 30, 1999 and 1998, respectively, have been included in the interest income computation. (3) Includes taxable-equivalent adjustments that relate to income on certain securities that is exempt from federal income taxes. The effective federal statutory tax rate was 34% for 1999 and 1998. (4) The rate / volume variance has been included in the rate variance. Provision for Loan Losses The Banks provided $410,000 for loan losses in the second quarter of 1999 versus $24,000 in 1998. The Banks had net loan recoveries of $74,000 in the second quarter of 1999 versus $3,000 in the year earlier period. The additional provision in 1999 was made primarily as a result of increases in loan balances. For the six-month period ended June 30, 1999, the Banks have provided $537,000 for loan losses versus $41,000 in the year earlier period. In this six-month period, the Banks have recorded net loan charge-offs of $7,000 as compared to $36,000 in the first six-months of 1998. Noninterest Income Noninterest income consists primarily of service charges on deposit accounts and fees for miscellaneous services. Noninterest income totaled $591,000 in the second quarter of 1999, which was up $61,000 (11.5%) over the same period in 1998. The Banks realized a gain of $45,000 from the sale of investment securities during the second quarter of 1999. Most other increases were due to higher volumes. For the first six-months of 1999, noninterest income was $1,133,000, which reflected a 22.6% increase over the same period last year. Service charges on deposits were up $66,000 (11.2%) due to higher volumes and some selective fee increases implemented in the second and fourth quarters in 1998. Other service charges and fees were up $57,000 (52%) mostly due to new fee structures on several services that were implemented in the fourth quarter of 1998. Also, fees from mortgage originations increased $62,000 (69%) as activity levels were higher in the first six months of 1999. As mortgage rates have risen in the second quarter of 1999, the mortgage originations have begun to slow down. Management does not expect continued growth in this area during the balance of 1999. Noninterest Expense Second quarter 1999 noninterest expense increased $366,000 (10.6%) to $3,824,000 from the 1998 second quarter. Salary and employee benefits increased $198,000 (9.6%) due to increased staff for the Westridge branch which opened in December 1998, higher commissions on mortgage originations, additional staff due to growth, higher benefit costs, and normal salary increases. On a quarter over quarter basis, premise and fixed asset expenses were higher by $82,000 (16.2%). Costs associated with the Westridge branch, the new computer system and network upgrades installed in the second half of 1998 were the major factors contributing to the increased premise and fixed asset expenses. The overhead efficiency ratio for the second quarter of 1999 improved to 52.4% as compared to 54.1% in the same quarter of 1998. Noninterest expenses for the first six-month period of 1999 were $7,647,000 versus $6,910,000 for the same period in 1998. Salaries and benefits increased $373,000 (8.9%) for the first six months of 1999 due to increased staffing levels and higher commissions on mortgage originations, as indicated in the previous paragraph. Premise and fixed asset expenses were up $240,000 (26.0%) due to the addition of another branch and to increased computer system upgrades as detailed above. Other costs increased $124,000 (7.0%) that included $94,000 of one-time costs associated with merging Cypress Bank into Bank of Salinas and changing the Bank's name. The overhead efficiency ratio for the first six-months of 1999 improved to 53.9% as compared to 55.5% in the same period of 1998. Provision for Income Taxes As a result of investments in tax qualified municipal bonds, the Company revised its estimated income tax rate for the six months ended June 30, 1999 to 38.0% from 41.3% in the first quarter of 1999. As a result of the recalculation of the year-to-date tax rate, the effective rate for the second quarter of 1999 was 34.8%. The second quarter and first six-month tax rate for 1998 was 41.4%. Securities At June 30, 1999 available-for-sale securities had a market value of $156,704,000 with a cost basis of $159,967,000. The unrealized losses of $3,263,000 at June 30, 1999 was an increase of $2,558,000 from the ending balance at March 31, 1999. The increase in unrealized losses was the result of increasing interest rates and changing spreads in the securities market during the second quarter. The Company does not anticipate selling any of these securities for liquidity needs in the immediate future. Loans Ending loan balances at June 30, 1999 were $360,412,000, which was an increase of $42,074,000 (13.2%) from year-end 1998 balances and $84,067,000 (30.4%) from June 30, 1998 balances. All categories of loans were higher on a year over year basis. Loan demand has remained strong heading into the third quarter of 1999. Nonperforming Assets Nonperforming assets are comprised of loans delinquent 90 days or more with respect to interest or principal, loans for which the accrual of interest has been discontinued, and other real estate which has been acquired through foreclosure and is awaiting disposition. Unless well secured and in the process of collection, loans are placed on nonaccrual status when a loan becomes 90 days past due as to interest or principal, when the payment of interest or principal in accordance with the contractual terms of the loan becomes uncertain or when a portion of the principal balance has been charged off. When a loan is placed on nonaccrual status, the accrued and unpaid interest receivable is reversed and the loan is accounted for on the cash or cost recovery method thereafter, until qualifying for return to accrual status. Generally, a loan may be returned to accrual status when all delinquent interest and principal become current in accordance with the terms of the loan agreement and remaining principal is considered collectible or when the loan is both well secured and in process of collection. Real estate and other assets acquired in satisfaction of indebtedness are recorded at the lower of estimated fair market value net of anticipated selling costs or the recorded loan amount, and any difference between this and the amount is treated as a loan loss. The costs of maintaining other real estate owned and gains or losses on the subsequent sale are reflected in current earnings. The following is a summary of nonperforming assets:
(In thousands) June 30, December 31, 1999 1998 -------- ------- Past due 90 days or more and still accruing : Real estate $ 193 $ 1,174 Commercial 1,080 73 Installment and other - - -------- -------- 1,273 1,247 -------- -------- Nonaccrual: Real estate 523 543 Commercial 1,179 333 Installment and other - - -------- -------- 1,702 876 -------- -------- Total nonperforming loans 2,975 2,123 -------- -------- Other real estate owned 515 - -------- -------- Total nonperforming assets $ 3,490 $ 2,123 ======== ======== Allowance for loan losses as a percentage of nonperforming loans 148% 205% Nonperforming loans to total loans 0.93% 0.68%
Nonperforming loans increased $852,000 during the first six months of 1999. Three SBA loans (SBA guaranteed from 75% to 90%) totaling $2,150,000 were added to the nonperforming status since the end of 1998. These loans account for a significant portion of the total category. Coverage ratio of the allowance for loan losses to nonperforming loans changed from 205% at year-end to 164%. Overall loan quality has remained high during the first six months of 1999. Allowance for Loan Losses The allowance for loan losses reflects management's judgement as to the level considered adequate to absorb probable losses inherent in the loan portfolio. The allowance is increased by provisions charged to expense and reduced by loan charge-offs net of recoveries. Management determines an appropriate provision based upon information currently available to analyze loan loss potential, including (1) the loan portfolio balance in the period; (2) a comprehensive grading and review of new and existing loans outstanding; (3) actual previous charge-offs; and, (4) changes in economic conditions. In determining the provision for estimated losses related to specific major loans, management evaluates its allowance on an individual loan basis, including an analysis of the credit worthiness, cash flows and financial status of the borrower, and the condition and the estimated value of the collateral. Specific valuation allowances for secured loans are determined by the excess of recorded investment in the loan over the fair market value or net realizable value where appropriate, of the collateral. In determining overall generalvaluation allowances to be maintained and the loan loss allowance ratio, management evaluates many factors including prevailing and forecasted economic conditions, regular reviews of the quality of loans, industry experience, historical loss experience, composition and geographic concentrations of the loan portfolio, the borrowers' ability to repay and repayment performance and estimated collateral values. Management believes that the allowance for loan losses at June 30,1999 is adequate, based on information currently available. However, no prediction of the ultimate level of loans charged off in future years can be made with any certainty.
The following table summarizes activity in the allowance for loan losses for the periods indicated: Three months ended June 30, Six months ended June 30, (In thousands) 1999 1998 1999 1998 ---- ---- ---- ---- Beginning balance $ 4,398 $ 4,201 $ 4,352 $ 4,223 Provision charged to expense 410 24 537 41 Loans charged off (37) (21) (127) (90) Recoveries 111 24 120 54 -------- -------- ------- ------- Ending balance $ 4,882 $ 4,228 $ 4,882 $ 4,228 ======== ======== ======= ======= Ending loan portfolio $ 360,412 $ 276,345 ========= ========= Allowance for loan losses as percentage of ending loan portfolio 1.35% 1.53%
Liquidity Liquidity management refers to the Company's ability to provide funds on an ongoing basis to meet fluctuations in deposit levels as well as the credit needs and requirements of its clients. Both assets and liabilities contribute to the Company's liquidity position. Federal funds lines, short-term investments and securities, and loan repayments contribute to liquidity, along with deposit increases, while loan funding and deposit withdrawals decrease liquidity. The Banks assess the likelihood of projected funding requirements by reviewing historical funding patterns, current and forecasted economic conditions and individual client funding needs. Commitments to fund loans and outstanding standby letters of credit at June 30,1999 were approximately $130,722,000 and $2,083,000, respectively. Such loans relate primarily to revolving lines of credit and other commercial loans, and to real estate construction loans. The Company's sources of liquidity consist of its deposits with other banks, overnight funds sold to correspondent banks, unpledged short-term, marketable investments and loans available for sale. On June 30, 1999, consolidated liquid assets totaled $172.8 million or 30.2% of total assets as compared to $153.5 million or 28.2% of total consolidated assets on December 31, 1998. In addition to liquid assets, the Banks maintain lines of credit with correspondent banks for up to $80,000,000 available on a short-term basis. Informal agreements are also in place with various other banks to purchase participations in loans, if necessary. The Company serves primarily a business and professional customer base and, as such, its deposit base is susceptible to economic fluctuations. Accordingly, management strives to maintain a balanced position of liquid assets to volatile and cyclical deposits. Capital Resources The Company's total shareholders' equity was $51,667,000 at June 30, 1999 compared to $51,199,000 at December 31, 1998. The Company and the Banks are subject to regulations issued by the Board of Governors and the FDIC which require maintenance of a certain level of capital. A banking organization's total qualifying capital includes two components, core capital (Tier 1 capital) and supplementary capital (Tier 2 capital). Core capital, which must comprise at least half of total capital, includes common shareholders' equity, qualifying perpetual preferred stock, trust preferred securities and minority interests, less goodwill. Supplementary capital includes the allowance for loan losses (subject to certain limitations), other perpetual preferred stock, trust preferred securities, certain other capital instruments and term subordinated debt. The Company's major capital components are shareholders' equity in core capital, and the allowance for loan losses in supplementary capital. The following table shows the Company's actual capital amounts and ratios at June 30, 1999 and December 31, 1998 as well as the minimum capital ratios for capital adequacy under the regulatory framework:
For Capital Actual Adequacy Purposes: Amount Ratio Amount Ratio ---------------------- ---------------------------- As of June 30, 1999 Total Capital (to Risk Weighted Assets): $ 57,234,000 14.2% $ 32,342,000 8.0% Tier 1 Capital (to Risk Weighted Assets): 52,394,000 13.0% 16,171,000 4.0% Tier 1 Capital (to Average Assets): 52,394,000 9.5% 22,124,000 4.0% As of December 31, 1998 Total Capital (to Risk Weighted Assets): 53,588,000 14.8% 29,004,000 8.0% Tier 1 Capital (to Risk Weighted Assets): 49,326,000 13.6% 14,502,000 4.0% Tier 1 Capital (to Average Assets): 49,326,000 9.9% 19,935,000 4.0%
Year 2000 As the year 2000 approaches, a critical issue has emerged regarding how existing application software programs and operating systems can accommodate this date value. In brief, many existing application software products in the marketplace were designed to only accommodate a two digit date position which represents the year (e.g., "95" is stored on the system and represents the year 1995). As a result, the year 1999 (i.e., "99") could be the maximum date value these systems will be able to accurately process. This is not just a banking problem, as corporations around the world and in all industries are similarly impacted. The Company is uncertain regarding the consequences of the Year 2000 (Y2K) issue on the future results of operations, liquidity and financial condition; but believes that failure to ensure that its systems are in compliance with Y2K requirements could have a material adverse effect on its business. As a result, the Company has made addressing Y2K issues a priority of management and the Board. Based upon actions implemented to date, the Company currently anticipates that it will be successful in addressing Y2K issues and anticipates no materially adverse processing problems. The Company is subject to examination by the Federal Deposit Insurance Corporation and the Federal Reserve Bank under their Y2K Phase I and Phase II programs. Management is not currently aware of any conditions cited as unsatisfactory by such federal bank regulatory agencies. All mission critical systems have been identified by the Company, and the Company has tested and developed contingency plans, for each. The term"mission critical" refers to an application or system that is vital to the successful continuance of core business activity. Significantly all mission critical hardware and software utilized by the Company are provided by third parties. This requires that the Company be in close contact with relevant vendors and contractors as it conducts testing and contingency planning. Testing on the Company's mission critical systems is substantially complete and monitoring of vendor and customer relationships is ongoing. The Company has made disclosures to all existing and new customers regarding the importance of the Y2K issue and its relevance to the Company and the customer. The Company is conducting an ongoing effort to identify customers that represent material risk exposure to the institution, to evaluate their Y2K preparedness and risk to the Company and to implement appropriate risk controls. The Company also continues to evaluate the cost to address Y2K issues. Most costs incurred to date are in conjunction with the planned replacement of systems. The cost of system replacements accelerated to meet Y2K requirements and Y2K project specific costs have not been significant to the operations of the Company as a whole. Management estimates that the incremental cost of mitigating Year 2000 risk exclusive of management time that has been redirected to focus on this matter will be approximately $171,000. Despite efforts undertaken to date and as projected, there can be no assurance that problems will not arise which could have an adverse impact upon the Company due, among other matters, to the complexities involved in computer programming related to resolution of Year 2000 problems and the fact that the systems of other companies on which Central Coast Bancorp and its subsidiaries, Bank of Salinas and Cypress Bank, may rely must also be corrected on a timely basis. Many phases of the Company's Y2K preparedness plan have been completed: the Company has identified, assessed and prioritized mission critical systems; developed Year 2000 testing strategies and plans; implemented a customer due diligence program; and tested most mission critical systems. But, delays, mistakes or failures in correcting Y2K system problems by other companies on which Central Coast Bancorp and its subsidiaries may rely, could have a significant adverse impact upon Central Coast Bancorp and its subsidiaries, Bank of Salinas and Cypress Bank, and their ability to mitigate the risk of adverse impact of Y2K problems for their customers. The disclosure set forth above contains forward-looking statements. Specifically, such statements are contained in sentences including the words "expect" or "anticipate" or "could" or "should". Such forward-looking statements are subject to inherent risks and uncertainties that may cause actual results to differ materially from those contemplated by such forward-looking statements. The factors that may cause actual results to differ materially from those contemplated by the forward-looking statements include the failure by third parties to remedy Y2K issues or the inability of the Company to complete testing software changes on the time schedules currently expected. Nevertheless, the Company currently expects that its Y2K compliance efforts will be successful without material adverse effects on its business. Subsequent events Previous to July 9, 1999, the Company operated two banks subsidiaries, Bank of Salinas and Cypress Bank. Effective at the close of business on July 9, 1999. Cypress Bank was merged into the Bank of Salinas and the name of the Bank of Salinas was changed to Community Bank of Central California. Item 3. MARKET RISK MANAGEMENT The reader is referred to Item 7A of the Company's 1998 Annual Report on Form 10-K for information on market risk. There have been no significant changes since December 31, 1998. PART II - OTHER INFORMATION Item 1. Legal proceedings. None. Item 2. Changes in securities. None. Item 3. Defaults upon senior securities. None. Item 4. Submission of matters to a vote of security holders. THE ANNUAL MEETING OF THE SHAREHOLDERS WAS HELD ON MAY 24, 1999. PROPOSAL NO. 1: ELECTION OF DIRECTORS Number of Affirmative Votes C. EDWARD BOUTONNET 4,293,063 BRADFORD G. CRANDALL 4,289,074 ALFRED P. GLOVER 4,289,432 MICHAEL T. LAPSYS 4,289,207 DUNCAN L. McCARTER 4,293,018 ROBERT M. MRAULE, D.D.S., M.D. 4,289,207 LOUIS M. SOUZA 4,293,018 MOSE E. THOMAS, JR 4,289,207 NICK VENTIMIGLIA 4,293,063 PROPOSAL NO. 2: APPROVAL OF DELOITTE & TOUCHE LLP AS INDEPENDENT PUBLIC ACCOUNTANTS FOR THE 1999 FISCAL YEAR.
Number of Number of Number of Shares Votes Cast For Votes Cast Against Indicated As Abstentions ----------------- ------------------ ------------------------ 4,144,550 1,796 157,905
TOTAL NUMBER OF SHARES FOR WHICH PROXIES HAVE BEEN RECEIVED: 4,304,251. Item 5. Other information. None. Item 6. Exhibits and reports on Form 8-K. (a) Exhibits (2.1) Agreement and Plan of Reorganization and Merger by and between Central Coast Bancorp, CCB Merger Company and Cypress Coast Bank dated as of December 5, 1995, incorporated by reference from Exhibit 99.1 to Form 8-K filed with the Commission on December 7, 1995. (3.1) Articles of Incorporation, incorporated by reference from Exhibit 4.8 to Registration Statement on Form S-8 No. 33-89948, filed with the Commission on March 3, 1995. (3.2) Bylaws, as amended, incorporated by reference from the Company's 1998 Annual Report on Form 10K filed with the Commission on March 29,1999. (4.1) Specimen form of Central Coast Bancorp stock certificate incorporated by reference from the Company's 1994 Annual Report on Form 10K filed with the Commission on March 31, 1995. (10.1) Lease agreement dated December 12, 1994, related to 301 Main Street, Salinas, California incorporated by reference from the Company's 1994 Annual Report on Form 10K filed with the Commission on March 31, 1995. (10.2) King City Branch Lease incorporated by reference from Exhibit 10.3 to Registration Statement on Form S-4 No. 33-76972, filed with the Commission on March 28, 1994. (10.3) Amendment to King City Branch Lease incorporated by reference from Exhibit 10.4 to Registration Statement on Form S-4 No. 33-76972, filed with the Commission on March 28, 1994. *(10.4) 1982 Stock Option Plan, as amended, incorporated by reference from Exhibit 4.2 to Registration Statement on Form S-8 No. 33-89948, filed with the Commission on March 3, 1995. *(10.5) Form of Nonstatutory Stock Option Agreement under the 1982 Stock Option Plan incorporated by reference from Exhibit 4.6 to Registration Statement on Form S-8 No. 33-89948, filed with the Commission on March 3, 1995. *(10.6) Form of Incentive Stock Option Agreement under the 1982 Stock Option Plan incorporated by reference from Exhibit 4.7 to Registration Statement on Form S-8 No. 33-89948, filed with the Commission on March 3, 1995. *(10.7) 1994 Stock Option Plan incorporated by reference from Exhibit 4.1 to Registration Statement on Form S-8 No. 33-89948, filed with the Commission on March 3, 1995. *(10.8) Form of Nonstatutory Stock Option Agreement under the 1994 Stock Option Plan incorporated by reference from Exhibit 4.3 to Registration Statement on Form S-8 No. 33-89948, filed with Commission on March 3, 1995. *(10.9) Form of Incentive Stock Option Agreement under the 1994 Stock Option Plan incorporated by reference from Exhibit 4.4 to Registration Statement on Form S-8 No. 33-89948, filed with the commission on March 3, 1995. *(10.10) Form of Director Nonstatutory Stock Option Agreement under the 1994 Stock Option Plan incorporated by reference from Exhibit 4.5 to Registration Statement on Form S-8 No. 33-89948, filed with the commission on March 3, 1995. *(10.11) Form of Bank of Salinas Indemnification Agreement for directors and executive officers incorporated by reference from Exhibit 10.9 to Amendment No. 1 to Registration Statement on Form S-4 No. 33-76972, filed with the Commission on April 15, 1994. *(10.12) 401(k) Pension and Profit Sharing Plan Summary Plan Description incorporated by reference from Exhibit 10.8 to Registration Statement on Form S-4 No. 33-76972, filed with the Commission on March 28, 1994. *(10.13) Specimen form of Employment Agreement incorporated by reference from Exhibit 10.13 to the Company's 1996 Annual Report on Form 10K filed with the Commission on March 31, 1997. *(10.14) Specimen form of Executive Salary Continuation Agreement incorporated by reference from Exhibit 10.14 to the Company's 1996 Annual Report on Form 10K filed with the Commission on March 31, 1997. *(10.15) 1994 Stock Option Plan, as amended, incorporated by reference from Exhibit A to the Proxy Statement filed with the Commission on September 3, 1996 in connection with Central Coast Bancorp's 1996 Annual Shareholders' Meeting held on September 23, 1996. (10.16) Specimen of Indemnification Agreement, incorporated by reference from Exhibit D to the Proxy Statement filed with the Commission on September 3, 1996 in connection with Central Coast Bancorp's 1996 Annual Shareholders' Meeting held on September 23, 1996. (10.17) Purchase and Assumption Agreement for the Acquisition of Wells Fargo Bank Branches incorporated by reference from Exhibit 10.17 to the Company's 1996 Annual Report on Form 10K filed with the Commission on March 31, 1997. *(10.18) Employee Stock Ownership Plan and Trust Agreement incorporated by reference from Exhibit 10.18 to the Company's 1996 Annual Report on Form 10K filed with the Commission on March 31, 1997. (10.19) Lease agreement dated March 7, 1997, related to 484 Lighthouse Avenue, Monterey, California incorporated by reference from Exhibit 10.19 to the Company's 1997 Annual Report on Form 10K filed with the Commission on March 27, 1998. (21.1) The Registrant's only subsidiaries are its wholly-owned subsidiaries, Bank of Salinas and Cypress Bank. (27.1) Financial Data Schedule *Denotes management contracts, compensatory plans or arrangements. (b) Reports on Form 8-K - None SIGNATURES - ---------------------------------------------------------------------- Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. July 29, 1999 CENTRAL COAST BANCORP /S/ROBERT M. STANBERRY By: ------------------------ (Chief Financial Officer, Principal Accounting Officer) EXHIBIT INDEX Exhibit Number Description Page 27.1 Financial Data Schedule 25 EX-27 2 ARTICLE 9 FDS FOR 10-Q
9 This Schedule Contains Summary Financial Information Extracted >From (a) Item 7 - 'Financial Statements And Supplementary Data" And Is Qualified In Its Entirety By Reference To Such (b) Financial Statements Included In This Report And Incorporated Herein By Reference. 0000921085 CENTRAL COAST BANCORP 1,000 6-mos DEC-31-1999 Apr-01-1999 Jun-30-1999 48,052 0 0 0 156,704 0 0 360,412 4,882 572,753 504,172 12,408 4,506 0 0 0 40,141 13,451 572,753 7,686 2,343 2 10,031 3,180 3,329 6,702 410 45 3,824 3,059 3,059 0 0 1,994 0.31 0.30 5.4 1,273 1,702 0 0 4,398 37 111 4,882 4,882 0 0
-----END PRIVACY-ENHANCED MESSAGE-----