-----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, Fu03luKqYeBpc2tFm7DKIgUQgMk0Xm4LoQaI/Ix302y+U0ZAds0zVKDJdErZj+c+ J4le+zEgKx1IY6aFYxv0Lg== 0000914317-00-000103.txt : 20000215 0000914317-00-000103.hdr.sgml : 20000215 ACCESSION NUMBER: 0000914317-00-000103 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000214 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HARDIN BANCORP INC CENTRAL INDEX KEY: 0000947220 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 431719104 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-26560 FILM NUMBER: 539957 BUSINESS ADDRESS: STREET 1: 2ND & ELM STS STREET 2: P O BOX 608 CITY: HARDIN STATE: MO ZIP: 64035 BUSINESS PHONE: 8163984312 MAIL ADDRESS: STREET 1: 2ND & ELM STS STREET 2: P O BOX 608 CITY: HARDIN STATE: MO ZIP: 64035 10QSB 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 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 0-26560 HARDIN BANCORP, INC. - -------------------------------------------------------------------------------- (Exact name of Registrant as specified in its Charter) Delaware 43-1719104 - -------------------------------------------------------------------------------- State or other jurisdiction of (I.R.S. Employer incorporation or organization Identification Number) 201 Northeast Elm Street, Hardin, Missouri 64035 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code: (660) 398-4312 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ X ] No [ ] Indicate the number of shares outstanding of each of the issuer's classes of common stock as of the latest practicable date. Class Outstanding at December 31, 1999 - -------------------------------------------------------------------------------- Common stock, .01 par value 732,753 HARDIN BANCORP, INC. AND SUBSIDIARIES CONTENTS PART I FINANCIAL INFORMATION Item 1. Unaudited Financial Statements Consolidated Balance Sheets Consolidated Statements of Earnings Consolidated Statements of Stockholders' Equity Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations PART II OTHER INFORMATION Signatures
Hardin Bancorp, Inc. and Subsidiaries Consolidated Balance Sheets December 31, 1999 March 31, 1999 ------------- ------------- (Unaudited) Assets Cash $ 1,221,624 $ 838,044 Interest bearing deposits 2,333,768 4,156,648 Investment securities available-for-sale 37,402,809 44,519,193 Mortgage-backed securities available-for-sale 11,674,853 12,584,419 Loans receivable, net 75,655,320 69,504,900 Accrued interest receivable: Investment securities 453,857 501,114 Mortgage-backed securities 82,627 91,008 Loans receivable 528,641 456,003 Real estate owned 93,051 -- Premises and equipment 1,817,822 1,832,311 Stock in Federal Home Loan Bank (FHLB) of Des Moines, at cost 2,015,000 2,000,000 Deferred income taxes receivable 1,014,169 188,000 Prepaid expenses and other assets 332,647 384,481 ------------- ------------- Total assets $ 134,626,188 $ 137,056,121 ============= ============= Liabilities and Stockholders' Equity Liabilities: Deposits $ 85,367,822 $ 83,326,871 Advances from borrowers for property taxes and insurance 195,402 294,424 Advances from FHLB 36,300,000 40,000,000 Accrued interest payable 43,845 40,949 Current income taxes payable 157,481 159,367 Accrued expenses and other liabilities 706,695 674,969 ------------- ------------- Total liabilities 122,771,245 124,496,580 ------------- ------------- Stockholders' equity: Serial preferred stock, $.01 par value; 500,000 shares authorized, none issued or outstanding -- -- Common stock, $.01 par value; 3,500,000 shares authorized, 1,058,000 shares issued 10,580 10,580 Additional paid in capital 10,306,031 10,252,604 Retained earnings 8,613,165 8,097,420 Accumulated other comprehensive loss (1,800,757) (394,038) Unearned employee benefits (481,446) (643,395) Treasury stock (325,247 and 323,247 shares at cost, respectively) (4,792,630) (4,763,630) ------------- ------------- Total stockholders' equity 11,854,943 12,559,541 ------------- ------------- Total liabilities and stockholders' equity $ 134,626,188 $ 137,056,121 ============= =============
See accompanying notes to unaudited consolidated financial statements.
Hardin Bancorp, Inc. and Subsidiaries Consolidated Statements of Earnings (Unaudited) Three months ended Nine months ended December 31, December 31, ------------------------- ------------------------- 1999 1998 1999 1998 ---------- ---------- ---------- ---------- Interest income: Loans receivable $1,553,225 $1,360,212 $4,466,300 $4,025,967 Mortgage-backed securities 173,909 242,204 506,493 789,541 Investment securities 665,967 465,084 2,008,297 1,609,782 Other 57,135 150,108 179,933 307,932 ---------- ---------- ---------- ---------- Total interest income 2,450,236 2,217,608 7,161,023 6,733,222 ---------- ---------- ---------- ---------- Interest expense: Deposits 939,397 980,127 2,824,791 2,942,508 FHLB advances 488,864 518,990 1,448,085 1,523,891 ---------- ---------- ---------- ---------- Total interest expense 1,428,261 1,499,117 4,272,876 4,466,399 ---------- ---------- ---------- ---------- Net interest income 1,021,975 718,491 2,888,147 2,266,823 Provision for loan losses -- 18,800 1,297 50,000 ---------- ---------- ---------- ---------- Net interest income after provision for loan losses 1,021,975 699,691 2,886,850 2,216,823 ---------- ---------- ---------- ---------- Non-interest income: Service charges 155,170 129,933 441,389 297,592 Loan servicing fees 6,849 5,571 22,502 21,621 Gain on sale of loans -- 75,063 9,331 90,061 Gain on sale of investments and mortgage-backed securities -- 318,750 7,164 449,796 Other 65,485 42,488 197,607 97,226 ---------- ---------- ---------- ---------- Total non-interest income 227,504 571,805 677,993 956,296 ---------- ---------- ---------- ---------- Non-interest expense: Compensation and benefits 376,393 349,178 1,085,855 1,007,095 Occupancy and equipment 63,287 57,618 196,445 176,398 Federal insurance premiums 12,622 11,507 36,604 35,183 Data processing 52,121 40,298 152,436 124,216 Real estate owned 1,580 -- 2,706 -- Other 211,619 185,169 646,487 532,973 ---------- ---------- ---------- ---------- Total non-interest expense 717,622 643,770 2,120,533 1,875,865 ---------- ---------- ---------- ---------- Earnings before income taxes 531,857 627,726 1,444,310 1,297,254 Income tax expense 181,203 227,884 488,113 467,663 ---------- ---------- ---------- ---------- Net earnings $ 350,654 $ 399,842 $ 956,197 $ 829,591 ========== ========== ========== ========== Net earnings per share: Basic $ 0.51 $ 0.58 $ 1.39 $ 1.12 ========== ========== ========== ========== Diluted 0.49 0.55 1.34 1.07 ========== ========== ========== ==========
See accompanying notes to unaudited consolidated financial statements.
Hardin Bancorp, Inc. and Subsidiaries Consolidated Statements of Stockholders' Equity For the Nine Months Ended December 31, 1999 (Unaudited) Accumulated Additional Other Unearned Common Paid-in Retained Comprehensive Employee Stock Capital Earnings Loss Benefits -------------- --------------- -------------- ------------- ----------------- Balance at March 31, 1999 $ 10,580 10,252,604 8,097,420 (394,038) (643,395) Comprehensive income: Net earnings - - 956,197 - - Change in net unrealized loss on securities available for sale, net of tax - - - (1,406,719) - -------------- --------------- -------------- ------------- ----------------- Total comprehensive income (loss) - - 956,197 (1,406,719) - -------------- --------------- -------------- ------------- ----------------- Allocation of ESOP shares - 53,427 - - 88,680 Amortization of recognition and retention plan - - - - 73,269 Repurchase of common stock - - - - - Dividends declared ($.20 per share) - - (440,452) - - -------------- --------------- -------------- ------------- ----------------- Balance at December 31, 1999 $ 10,580 $ 10,306,031 8,613,165 (1,800,757) (481,446) ============== =============== ============== ============= ================= Total Treasury Shareholders' Stock Equity -------------- -------------- Balance at March 31, 1999 (4,763,630) 12,559,541 Comprehensive income: Net earnings - 956,197 Change in net unrealized loss on securities available for sale, net of tax - (1,406,719) -------------- -------------- Total comprehensive income (loss) - (450,522) -------------- -------------- Allocation of ESOP shares - 142,107 Amortization of recognition and retention plan - 73,269 Repurchase of common stock (29,000) (29,000) Dividends declared ($.20 per share) - (440,452) -------------- -------------- Balance at December 31, 1999 (4,792,630) 11,854,943 ============== ==============
See accompanying notes to unaudited consolidated financial statements.
Hardin Bancorp, Inc. and Subsidiaries Consolidated Statements of Cash Flows For the Nine Months Ended December 31, 1999 and 1998 (Unaudited) 1999 1998 ------------ ------- Operating Activities: Net Earnings $ 956,197 829,591 Adjustments to reconcile net earnings to net cash provided by operating activities: Provision for losses on loans 1,297 50,000 Depreciation 105,497 97,819 Premium accretion and amortization of discounts and deferred loan fees, net 42,969 (171,741) Net gain on sale of loans and investment and mortgage-backed securities (16,495) (539,857) Origination of loans held for sale -- (3,204,865) Proceeds from sales of loans 674,218 3,485,600 Allocation of ESOP shares 142,107 -- Amortization of deferred Recognition and Retention Plan (RRP) 73,269 66,457 Changes in asset and liabilities: Interest receivable (17,000) 84,459 Other assets 51,834 (106,775) Accrued interest payable 2,896 9,951 Accrued expense and other liabilities 17,431 206,726 Income taxes payable (1,886) (60,538) ------------ ------------ Net cash provided by operating activities 2,032,334 746,827 ------------ ------------ Investing Activities: Net increase in loans receivable (6,591,703) (6,034,725) Principal payments on mortgage-backed & related securities: Available-for-sale 5,870,049 4,186,148 Held-to-maturity -- 1,026,694 Proceeds from sales of available-for-sale mortgage-backed securities 363,166 -- Purchase of available-for-sale investment securities (1,810,904) (32,244,489) Purchase of loans serviced by other institutions (328,406) -- Proceeds from maturities of available-for-sale investment securities 340,000 8,000,000 Proceeds from sales of available for sale investment securities 1,005,400 18,341,167 Purchase of stock in FHLB of Des Moines (15,000) (500,000) Purchase of office properties and equipment (91,008) (203,560) ------------ ------------ Net cash used in investing activities $ (1,258,406) (7,428,765) ------------ ------------ Hardin Bancorp, Inc. and Subsidiaries Consolidated Statements of Cash Flows For the Nine Months Ended December 31, 1999 and 1998 (Unaudited) 1999 1998 ------------ ------- Financing Activities: Net increase in savings deposits $ 2,040,951 4,675,977 Proceeds from FHLB advances 26,800,000 18,000,000 Repayments of FHLB advances (30,500,000) (12,500,000) Net decrease in advances from borrowers for taxes and insurance (99,022) (121,569) Payment of dividends (426,157) (343,816) Purchase of treasury stock (29,000) (1,446,854) ------------ ------------ Net cash (used in) provided by financing activities (2,213,228) 8,263,738 ------------ ------------ (Decrease) increase in cash (1,439,300) 1,581,800 Cash and equivalents at beginning of period 4,994,692 3,781,801 ------------ ------------ Cash and equivalents at end of period $ 3,555,392 5,363,601 ============ ============ Supplemental disclosure of cash flow information: Cash paid for: Interest $ 4,269,980 4,456,448 Income taxes, net of refunds $ 489,999 528,201 Non-cash investing and financing: Dividends declared and payable $ 146,951 118,319 Loans transferred to real estate owned $ 93,051 -- Transfer of investment and mortgage-backed securities from held-to-maturity to available-for-sale -- 19,951,798
See accompanying notes to unaudited consolidated financial statements. HARDIN BANCORP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Unaudited) (1) Basis of Presentation The accompanying unaudited consolidated financial statements of Hardin Bancorp, Inc. and subsidiaries have been prepared in accordance with instructions for Form 10-QSB. To the extent that information and footnotes required by generally accepted accounting principles for complete financial statements are contained in the audited financial statements included in the Company's Annual Report for the year ended March 31, 1999, such information and footnotes have not been duplicated herein. In the opinion of management, all adjustments, consisting only of normal recurring accruals, which are necessary for the fair presentation of the interim financial statements have been included. The statement of earnings for the nine-month period ended December 31, 1999 is not necessarily indicative of the results, which may be expected for the entire year. The March 31, 1999 consolidated balance sheet has been derived from the audited consolidated financial statements as of that date. (2) Earnings Per Share Basic earnings per share excludes dilution and is computed by dividing income available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share includes the effect of potential dilutive common shares (stock options) outstanding during the period. The shares used in the calculation of basic and diluted earnings per share are shown below:
For the three months ended For the nine months ended December 31, December 31, 1999 1998 1999 1998 ---- ---- ---- ---- Basic weighted average shares 689,516 691,546 690,093 738,664 Common stock equivalents/stock options 22,024 30,833 24,399 33,059 ---------------------------- ----------------------------- Diluted weighted average shares 711,540 722,379 714,492 771,723 ============================ =============================
(3) Comprehensive Income On April 1, 1998 the Company adopted SFAS No. 130, "Reporting Comprehensive Income" which requires the reporting of comprehensive income and its components. Comprehensive income is defined as the change in equity from transactions and other events and circumstances from non-owner sources and excludes investments by and distributions to owners. Comprehensive income includes net income and other items of comprehensive income meeting the above criteria. The Company's only component of other comprehensive income is the unrealized holding gains and losses on available-for-sale securities.
For the three months ended For the nine months ended December 31, December 31, 1999 1998 1999 1998 ---- ---- ---- ---- Unrealized holding gains (losses) (837,496) (129,924) (2,225,724) 154,655 Less: reclassification adjustment for gains included in net income - 318,750 7,164 449,796 ------------------------------ ----------------------------- Net unrealized gains (losses) on securities (837,496) (448,674) (2,232,888) (295,141) Income tax benefit (expense) 309,873 (163,923) 826,169 (107,116) ------------------------------ ----------------------------- Other comprehensive income (loss) (527,623) (284,751) (1,406,719) (188,025) ============================== =============================
HARDIN BANCORP, INC. AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS GENERAL Hardin Bancorp, Inc. (the "Company") was incorporated under the laws of the state of Delaware to become a savings bank holding company with Hardin Federal Savings Bank (the "Bank") of Hardin, Missouri, as its subsidiary. The holding company was incorporated at the direction of the Board of Directors of the Bank, and on September 28, 1995, acquired all of the capital stock of the Bank upon its conversion from mutual to stock form (the "conversion"). Prior to the conversion, the holding company did not engage in any material operations. Hardin Federal Savings Bank was originally founded in 1888 as a Missouri chartered savings and loan association located in Hardin, Missouri. On March 21, 1995, the Bank's members voted to convert the Bank to a Federal mutual charter. The Bank conducts its business through its main office in Hardin, Ray County, and two full service branch offices located in Richmond, Ray County, and Excelsior Springs, Clay County, Missouri. Deposits are insured by the Federal Deposit Insurance Corporation (the "FDIC") to the maximum allowable. The Bank is principally engaged in the business of attracting retail savings deposits from the general public and investing those funds in first mortgage loans on owner occupied, single-family residential loans, commercial real estate loans, mortgage-backed securities, U.S. Government and agency securities, and insured interest bearing deposits. The Bank also originates consumer loans for the purchase of automobiles, home improvement, and home equity lines of credit. The most significant outside factors influencing the operations of the Bank and other financial institutions include general economic conditions, competition in the local market place and the related monetary and fiscal policies of agencies that regulate financial institutions. More specifically, the cost of funds primarily consisting of insured deposits is influenced by interest rates on competing investments and general market rates of interest, while lending activities are influenced by the demand for real estate financing and other types of loans, which in turn is affected by the interest rates at which such loans may be offered and other factors affecting loan demand and funds availability. The deposits of the Bank are insured by the Savings Association Insurance Fund (the "SAIF"), which together with the Bank Insurance Fund (the "BIF"), are the two insurance funds administered by the FDIC. FINANCIAL CONDITION Consolidated assets of Hardin Bancorp, Inc. were $134,626,188 as of December 31, 1999, as compared to $137,056,121, on March 31, 1999, a decrease of $2,429,933. The decrease was primarily due to a decrease in investment securities and interest-bearing deposits partially offset by an increase in loans. Loans receivable, net, increased to $75,655,320 on December 31, 1999 from $69,504,900 on March 31, 1999, an increase of $6,150,420. Mortgage-backed securities decreased $909,566 to $11,674,853 on December 31, 1999, from $12,584,419 on March 31, 1999. The decrease in mortgage-backed securities and the increase in loans reflect the Bank's plan to increase the loan portfolio and decrease mortgage-backed securities. Cash, interest bearing deposits and investment securities decreased $8,555,684 from $49,513,885 on March 31, 1999, to $40,958,201 on December 31, 1999. The decrease was due to investment funds being utilized to repay FHLB advances and originate mortgage and consumer loans. Deposits totaled $85,367,822 on December 31, 1999, an increase of $2,040,951 from $83,326,871 on March 31, 1999. The increase in deposits was primarily due to a successful special certificate of deposit promotion and the Bank's high performance checking account program. Stockholders' equity was $11,854,943 on December 31, 1999, compared to $12,559,541 on March 31, 1999. The decrease in stockholders' equity was the result of an increase in the unrealized loss on investment securities offset by the increase in retained earnings and by a reduction in unearned employee benefits. RESULTS OF OPERATIONS Net earnings for the Company's quarter ended December 31, 1999 were $350,654 compared to $399,842 for the comparable quarter in 1998. The relatively small decrease in earnings was primarily due to a reduction in the gain on sales of loans, investments and mortgage-backed securities, offset by an increase in net interest income after provision for loan losses. Basic earnings per share for the quarter ended December 31, 1999 were $0.51 while diluted earnings per share were $0.49. Basic earnings per share for the quarter ended December 31, 1999 were calculated based on 689,516 average shares outstanding and diluted earnings per share were calculated based on 711,540 average shares outstanding. Basic earnings per share for the comparable quarter ended December 31, 1998 were $0.58 while diluted earnings per share were $0.55. Basic earnings per share for the quarter ended December 31, 1998 were calculated based on 691,546 average shares outstanding and diluted earnings per share were calculated based on 722,379 average shares outstanding. Net interest income after provision for loan losses was $1,021,975 for the quarter ended December 31, 1999 compared to $699,691 for the quarter ended December 31, 1998, an increase of $322,284. This increase was a result of total interest income increasing $232,628 from $2,217,608 in 1998 to $2,450,236 in 1999 while total interest expense decreased $70,856 from $1,499,117 in 1998 to $1,428,261 in 1999. The increase in total interest income was due to an increase in the average yield on interest earning assets while the decrease in total interest expense was a result of a decrease in the average cost of deposits. Total non-interest income decreased from $571,805 for the quarter ended December 31, 1998 to $227,504 for the quarter ended December 31, 1999. The decrease was primarily due to a reduction in gains on the sale of loans, investments and mortgage-backed securities. The Company's total non-interest expense for the three months ended December 31, 1999 was $717,622 compared to $643,770 for the comparable quarter in 1998. The increase was primarily due to increases in compensation and benefits expense, occupancy and equipment expense, data processing expense, and other expense related to Year 2000 compliance issues. Net earnings for the nine months ended December 31, 1999, were $956,197 compared to $829,591 for the nine months ended December 31, 1998, an increase of $126,606. The increase was primarily due to an increase in net interest income, partially offset by a reduction in the gain on sale of loans, investments and mortgage-backed securities and by an increase in total non-interest expense. Basic earnings per share for the nine months ended December 31, 1999 were $1.39 while diluted earnings per share were $1.34. Basic earnings per share for nine months ended December 31, 1999 were calculated based on 690,093 average shares outstanding and diluted earnings per share were calculated based on 714,492 average shares outstanding. Basic earnings per share for the nine months ended December 31, 1998 were $1.12 while diluted earnings per share were $1.07. Basic earnings per share for the similar period ended December 31, 1998 were calculated based on 738,664 average shares outstanding and diluted earnings per share were calculated based on 771,723 average shares outstanding. Net interest income after provision for loan losses for the nine month period ended December 31, 1999 was $2,886,650 compared to $2,216,823 for the nine month period ended December 31, 1998, an increase of $670,027. The increase was due to an increase in the Bank's net interest margin as total interest income increased $427,801, while total interest expense decreased $193,523. The increase in total interest income was due to an increase in loans receivable, net and an increase in the average yield on investments, while the decrease in total interest expense was a result of growth in lower costing transaction accounts. Non-interest income for the nine months ended December 31, 1999, was $677,993 compared to $956,296 for the nine month period a year earlier, a decrease of $278,303. The decrease was primarily due to a reduction in gains on sales of loans, investments and mortgage-backed securities. Other non-interest income increased by $100,381 primarily due as a result of increased income generated by the Bank's service corporation and a life insurance benefit. The Company's non-interest expense for the nine months ended December 31, 1999 was $2,120,533, compared to $1,875,865 for the nine months ended December 31, 1998, an increase of $244,668. The increase was due to an increase in compensation and benefits, occupancy and equipment expense, data processing expense and other non-interest expense related to Year 2000 issues. The approximate cost incurred by the Company to date for Year 2000 compliance was $83,000. PROVISION FOR LOAN LOSSES For the three months ended December 31, 1999 the Company did not record a provision for loan losses in accordance with its classification of assets policy. The Company's loan portfolio consists primarily of one to four family loans, and has experienced minimal charge-offs in the past two years. At December 31, 1999, the Bank's allowance for loan losses was $306,859, or 141% of non-performing assets compared to $311,196, or 135% at March 31, 1999. The allowance for loan losses was .41% of total loans at December 31, 1999, compared to .45% at March 31, 1999. At December 31, 1999, non-performing assets were $217,668 compared to $231,000 at March 31, 1999. Loans are considered non-performing when the collection of principal and/or interest is not probable, or in the event payments are more than 90 days delinquent. Management will continue to monitor its allowance for loan losses and make additions to the allowance through the provision for loan losses as economic conditions dictate. Although the Company maintains its allowance for loan losses at a level considered to be adequate, there can be no assurance that future losses will not exceed estimated amounts or that additional provisions for loan losses will not be required in the future. CAPITAL RESOURCES The Bank is subject to three capital to asset requirements in accordance with Office of Thrift Supervision (the "OTS") regulations. The following table is a summary of the Bank's regulatory capital requirements versus actual capital at December 31, 1999.
Actual Required Excess Amount/Percent Amount/Percent Amount/Percent -------------- -------------- -------------- (Dollars in Thousands) Tangible Capital $12,805/ 9.43% $2,038/ 1.50% $10,767/ 7.93% Core Leverage Capital $12,805/ 9.43% $4,076/ 3.00% $8,729/ 6.43% Risk-based Capital $13,106/18.77% $5,586/ 8.00% $7,520/10.77%
LIQUIDITY The Bank's principal sources of funds are deposits, principal and interest payments on loans, deposits in other insured institutions, and investment securities. While scheduled loan repayments and maturing investments are relatively predictable, deposit flows and early loan payments are more influenced by interest rates, general economic conditions and competition. Additional sources of funds may be obtained from the FHLB by utilizing numerous available products to meet funding needs. The Bank is required to maintain minimum levels of liquid assets as defined by regulations. The required percentage is currently four percent of net withdrawable savings deposits and borrowings payable on demand or in one year or less. The Bank has maintained its liquidity ratio at levels exceeding the minimum requirement. The eligible liquidity ratio at December 31, 1999 was 27.13%. In light of the competition for deposits, the Bank may utilize the funding sources of the FHLB to meet loan demand in accordance with the Bank's growth plans. The wholesale funding sources may allow the Bank to obtain a lower cost of funding and create a more efficient liability match to the respective assets being funded. For purposes of the cash flows, all short-term investments with a maturity of three months or less at the date of purchase are considered cash equivalents. Cash and cash equivalents for the periods ended December 31, 1999 and 1998 were $3,555,392 and $5,363,601, respectively. The decrease was primarily due to an increase in net cash used in financing activities. Net cash provided by financing activities decreased from $8,263,738 for the nine months ended December 31, 1998 compared to ($2,213,228) for the nine months ended December 31, 1999. The decrease in net cash provided by financing activities was due to repayments of FHLB advances and a reduction in available-for-sale securities. RECENT ACCOUNTING DEVELOPMENTS In June 1999, the Financial Accounting Standards board issued SFAS No. 137, "Accounting for Derivative Instruments and Hedging Activities - Deferral of the Effective Date of FASB Statement No. 133." This statement amends SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities, " to defer its effective date. SFAS No. 137 is effective for all fiscal quarters beginning after June 15, 2000, however the Company adopted the provisions of SFAS No. 133 at July 1, 1998 and utilized an option to transfer its held-to-maturity investment security portfolio to available-for-sale. Accordingly, all unrealized gains and losses were recorded at that date. The Company does not have any financial instruments considered to be derivatives under the provisions of SFAS No. 133. YEAR 2000 COMPLIANCE Hardin Bancorp, Inc. had a successful transition to year 2000 processing. The Company will continue to monitor all processing to ensure that no Y2K issues arise in the future. The Company has taken the necessary steps to validate and test its contingency/business resumption plan in order to minimize the impact on operations should there be system failures in the future. FORWARD LOOKING STATEMENT This Quarterly Report on Form 10-Q may contain certain forward-looking statements consisting of estimates with respect to the financial condition, results of operations and business of the Company that are subject to various factors which could cause actual results to differ materially from these estimates. These factors include, but are not limited to, general economic conditions, changes in interest rates, deposit flows, loan demand, real estate values and competition; changes in accounting principles, policies or guidelines; changes in legislation or regulation; and other economic, competitive, governmental, regulatory and technological factors affecting the Company's operations, pricing, products and services. 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 None. Item 5. Other Information On November 1, 1999, the Bank formed a new subsidiary, Hardin Investment Limited Liability Company. The purpose of the formation of this new subsidiary is to hold certain investment securities. As of December 31, 1999, the Company held 325,247 shares of its common stock as treasury stock at an aggregate purchase price of $4,792,630. On December 16, 1999 the Board of Directors declared a $.20 per share cash dividend to all stockholders of record on January 7, 2000, payable on January 21, 2000. Item 6. Exhibits and Reports on Form 8-K Exhibits: 27 - Financial Data Schedule Reports on Form 8-K: None. SIGNATURES Pursuant to the requirement 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. HARDIN BANCORP, INC. Registrant Date: February 14, 2000 /s/ Robert W. King ----------------- ------------------ Robert W. King, President and Chief Executive Officer (Duly Authorized Officer) Date: February 14, 2000 /s/ Karen K. Blankenship ----------------- ------------------------ Karen K. Blankenship, Senior Vice President and Secretary (Principal Accounting Officer) EX-27 2
9 1,000 9-MOS MAR-31-2000 DEC-31-1999 1,222 2,334 0 0 49,078 0 49,078 75,962 307 134,626 85,368 14,000 1,103 22,300 0 0 11 11,844 11,855 4,466 2,515 180 7,161 2,825 4,273 2,888 1 7 2,121 1,444 1,444 0 0 956 1.39 1.34 7.20 218 0 0 605 311 5 1 307 281 0 26
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