-----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, Mj48hwiTSzUKyH5Sfd0crUWzfo4thbP9Sp5PAdvHHUstL1pOwK6UFlHXVqqDw32x TUGNywA3lWAliK6ZgD8egQ== 0000916480-00-000019.txt : 20000331 0000916480-00-000019.hdr.sgml : 20000331 ACCESSION NUMBER: 0000916480-00-000019 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000330 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PSB HOLDINGS INC /WI/ CENTRAL INDEX KEY: 0000948368 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTIONS, NOT FEDERALLY CHARTERED [6036] IRS NUMBER: 391804877 STATE OF INCORPORATION: WI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: SEC FILE NUMBER: 000-26480 FILM NUMBER: 585022 BUSINESS ADDRESS: STREET 1: 1905 WEST STEWART AVE CITY: WAUSAU STATE: WI ZIP: 54401 BUSINESS PHONE: 7158422191 MAIL ADDRESS: STREET 1: 1905 WEST STEWART AVE CITY: WAUSAU STATE: WI ZIP: 54401 FORMER COMPANY: FORMER CONFORMED NAME: PSB HOLDINGS INC /WI/ DATE OF NAME CHANGE: 19950721 FORMER COMPANY: FORMER CONFORMED NAME: PEOPLES STATE BANK /WI/ DATE OF NAME CHANGE: 19950721 10-K 1 PSB HOLDINGS, INC. 10-K FORM 10-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED] FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from __________ to __________ COMMISSION FILE NO. 0-26480 PSB HOLDINGS, INC. (Exact name of registrant as specified in charter) 1905 W. STEWART AVENUE WISCONSIN WAUSAU, WI 54401 (State of incorporation) 39-1804877 (Address of principal executive office) (I.R.S. Employer Identification Number) Registrant's telephone number, including area code: 715-842-2191 Securities registered pursuant to Section 12(b) of the Act: NONE Securities registered pursuant to Section 12(g) of the Act: COMMON STOCK, NO PAR VALUE (Title of each class) Indicate by check 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 report), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ______ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. As of March 9, 2000, the aggregate market value of the common stock held by non-affiliates was $26,415,900. As of March 15, 2000, 872,967 shares of common stock were outstanding. DOCUMENTS INCORPORATED BY REFERENCE PROXY STATEMENT DATED MARCH 31, 2000 (TO THE EXTENT NOTED HEREIN): PART III TABLE OF CONTENTS PAGE PART I Item 1. Business 1 Item 2. Properties 6 Item 3. Legal Proceedings 6 Item 4. Submission of Matters to a Vote of Security Holders 6 PART II Item 5. Market for Registrant's Common Equity and Related Stockholder Matters 7 Item 6. Selected Financial Data 7 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 Item 7A. Quantitative and Qualitative Disclosure About Market Risk 23 Item 8. Financial Statements and Supplementary Data 24 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 52 PART III Item 10. Directors and Executive Officers of Registrant 53 Item 11. Executive Compensation 53 Item 12. Security Ownership of Certain Beneficial Owners and Management 53 Item 13. Certain Relationships and Related Transactions 53 PART IV Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K 54 -i- PART I ITEM 1. BUSINESS. FORMATION PSB Holdings, Inc., a Wisconsin corporation (the "Company"), is a one-bank holding company formed in 1995. The Company owns 100% of the common stock of Peoples State Bank, Wausau, Wisconsin (the "Bank"). BUSINESS OF THE COMPANY The Company is a one-bank holding company regulated by the Board of Governors of the Federal Reserve System (the "FRB") under the authority of the Bank Holding Company Act of 1956, as amended (the "BHCA"). The Company's sole business is the ownership and management of the Bank. BUSINESS OF THE BANK The Bank was organized as a state banking corporation under the laws of the state of Wisconsin in 1962. In addition to its main office in Wausau, the Bank operates branch offices in the city of Wausau, Rib Mountain Township, Marathon City, and the city of Rhinelander Wisconsin. The Bank offers personal and commercial deposit services, including checking and savings accounts of various kinds, IRA and other deposit instruments, ATM service and night depository and safety deposit box services. The Bank also engages in consumer and commercial lending, including secured and unsecured term loans and real estate financing. New services are frequently added to the Bank's retail banking business. The Bank offers discount brokerage services at its Wausau branch location, including the sale of annuities, mutual funds and other investments to Bank customers and the general public. The Bank maintains an investment subsidiary in Nevada to manage, hold and trade cash and securities. PRINCIPAL SOURCES OF REVENUE The table below shows the amount and percentages of the Bank's total consolidated operating revenues resulting from interest on loans and leases and interest on investment securities for each of the last three years: -1-
($ in thousands) Interest on loans and Interest on Investment LEASES SECURITIES Percent Percent of Total of Total Year Ended Operating Operating DECEMBER 31 AMOUNT REVENUES AMOUNT REVENUES 1999 $14,065 74.3% $3,471 18.3% 1998 13,404 73.8 3,020 16.6 1997 12,688 76.9 2,951 17.9
BANK MARKET AREA AND COMPETITION The Bank's primary trade area consists of the greater Wausau, Wisconsin area, Marathon County, and Rhinelander, Wisconsin in Oneida County. There is a mix of retail, manufacturing, agricultural and service businesses in the areas served by the Bank. Commercial and retail banking in the state of Wisconsin, and in the Wausau area in particular, is highly competitive with respect to price and services. "Price" includes interest rates paid on deposits, interest rates charged on borrowings and fees charged for fiduciary services, while "services" includes the types of loan, deposit and other products offered, convenience of banking locations and the quality of service rendered to customers. In addition to competition from other commercial banks, the Bank faces significant competition from savings and loan associations, credit unions and other financial institutions or financial service companies within its market area. Credit union deposits constitute a substantial portion of all financial institution deposits within the state of Wisconsin and these associations compete aggressively with commercial banks in the important area of consumer lending and interest-bearing checking accounts. The Bank is subject to direct competition in its trade area from nine commercial banks which offer a full line of competitive bank services, loan production offices of banks located outside of the region, and numerous savings and loan associations and credit unions. Several of the financial institutions with which the Bank competes are subsidiaries of the three largest state-wide multi-bank holding companies and many of the other financial institutions are also significantly larger and have more resources than the Bank. In its primary trade area, the Bank has approximately 12% of total financial institution assets, deposits and loans. In addition to competition, the business of the Bank will be affected by general economic conditions, including the level of interest rates and the monetary policies of the FRB (see "Regulation and Supervision - Monetary Policy"). -2- EMPLOYEES The Company has no employees. Officers of the Company serve as full time employees of the Bank. As of December 31, 1999, the Bank had 106 employees, including 26 employed on a part-time basis. All officers, supervisors and full-time employees are salaried and all part-time employees are paid on an hourly basis. The Bank considers its relations with its employees to be excellent. None of the Bank's employees is covered by a collective bargaining agreement. REGULATION AND SUPERVISION REGULATION The Company and the Bank are subject to regulation under both federal and state law. The Company is a registered bank holding company and is subject to regulation and examination by FRB pursuant to the BHCA. The Bank is subject to regulation and examination by the Federal Deposit Insurance Corporation ("FDIC") and, as a Wisconsin chartered bank, by the Wisconsin Department of Financial Institutions. The FRB expects a bank holding company to be a source of strength for its subsidiary banks. As such, the Company may be required to take certain actions or commit certain resources to the bank when it might otherwise choose not to do so. Under federal and state banking laws, the Company and the Bank are also subject to regulations which govern the Company's and the Bank's capital adequacy, loans and loan policies (including the extension of credit to affiliates), deposits, payment of dividends, establishment of branch offices, mergers and other acquistions, investments in or the conduct of other lines of business, management personnel, interlocking directorates and other aspects of the operation of the Company and the Bank. Bank regulators having jurisdiction over the Company and the Bank generally have the authority to impose civil fines or penalties and to impose regulatory control for noncompliance with applicable banking regulations and policies. In particular, the FDIC has broad authority to take corrective action if the Bank fails to maintain required captial. Information concerning the Company's compliance with applicable capital requirements is set forth in Note 15 of the Notes to Consolidated Financial Statements. The Gramm-Leach-Bliley Act of 1999 (the "Act") will eliminate many of the legal barriers to affiliations among banks and securities firms, insurance companies and other financial service companies. Under the Act, a financial holding company may engage in a broad list of "financial activities," and any non-financial activity that the FRB determines is "complementary" to a financial activity and poses no substantial risk to the safety and soundness of depository institutions or the financial system. -3- The Act also contains a number of other provisions that will affect the Company's operations and the operations of all financial institutions. One of the new provisions relates to the financial privacy of consumers, authorizing federal banking regulators to adopt rules that will limit the ability of banks and other financial entities to disclose non-public information about consumers to non-affiliated entities. These limitations will likely require more disclosure to consumers, and in some circumstances, will require consent by the consumer before information is allowed to be provided to a third party. The changes in the rules governing the affiliation of banks and securities firms and insurance companies became effective March 11, 2000. While certain other provisions of the Act became effective on November 12, 1999, other provisions are subject to delayed effective dates, and in some cases, will be implemented only upon the adoption by federal regulatory agencies of rules prescribed by the Act. The Act specifies certain activities that are deemed to be financial in nature, including lending, exchanging, transferring, investing for others, or safeguarding money or securities; underwriting and selling insurance; providing financial, investment, or economic advisory services; underwriting, dealing in or making a market in, securities; and any activity currently permitted for bank holding companies by the FRB under Section 4(c)(8) of BHCA. The overall effect of the new law is expected to give consumers greater choice for banking, and insurance services and securities transactions. While the effect of the new law will likely be an increase in competition from larger financial institutions, the Company cannot predict whether the Act will adversely affect its business, financial condition or results of operations. Banking laws and regulations have undergone periodic revisions that often have a direct effect on the Bank's operations and its competitive environment. From time to time various formal or informal proposals, including new legislation, relating to, among other things, changes with respect to deposit insurance, permitted bank activities and restructuring of the federal regulatory scheme have been made and may be made in the future. The Gramm-Leach-Bliley Act is an example of legislation which affects the operation of the Company's business. Depending on the scope and timing of future regulatory changes, it is possible that additional legislation may have a material adverse effect on the Company's consolidated financial condition, liquidity or results of operations. MONETARY POLICY The earnings and growth of the Bank, and therefore the Company, are affected by the monetary and fiscal policies of the federal government and governmental agencies. The FRB has broad power to expand and contract the supply of money and credit and to regulate the rates which its member banks can pay on time and savings deposits. These broad powers are used to influence inflation and the growth of the economy and directly affect the growth of bank loans, investments and deposits, and may also affect the interest rates charged by banks on loans paid by banks in respect of deposits. Governmental and FRB monetary -4- policies have had a significant effect on the operating results of commercial banks in the past and are expected to do so in the future. Management of the Company is not able to anticipate the future impact of such policies and practices on the growth or profitability of the Company. EXECUTIVE OFFICERS The executive officers of the Company as of March 18, 2000, their ages and principal occupations during the last five years are set forth below.
David K. Kopperud, 54 President of the Company and the Bank since July, 1999; previously Executive Vice President of the Bank (1994-1999) and Vice President of the Bank (1991-1994). Kenneth M. Selner, 53 Vice President & Secretary of the Company; Executive Vice President of the Bank. Todd R. Toppen, 41 Treasurer of the Company; Vice President of the Bank since 1994, Assistant Vice President 1988 to 1993.
CAUTIONARY STATEMENT REGARDING FORWARD LOOKING INFORMATION This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Reform Act"). In addition, certain statements in future filings by the Company with the Securities and Exchange Commission, reports to shareholders, press releases, and in other oral and written statements made by or with the approval of the Company which are not statements of historical fact will constitute forward-looking statements within the meaning of the Act. Examples of forward-looking statements include, but are not limited to: (i) expectations concerning financial performance of the Company, (ii) expectations concerning the payment of dividends, (iii) statements of plans and objectives of the Company, (iv) statements of future economic performance and (v) statements of assumptions underlying such statements. Words such as "believes", "anticipates", "expects", "intends", "targeted" and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. In making forward-looking statements within the meaning of the Reform Act, the Company undertakes no obligation to publicly update or revise any such statement. Forward-looking statements of the Company are based on information available to the Company as of the date of such statements and reflect the Company's expectations as of such date, but are subject to risks and uncertainties that may cause actual results to vary materially. In -5- addition to specific factors which may be described in connection with any of the Company's forward-looking statements, factors which could cause actual results to differ materially from those discussed in the forward-looking statements include, but are not limited to the following: (i) the strength of the U.S. economy in general and the strength of the local economies in the markets served by the bank; (ii) the effects of and changes in government policies, including interest rate policies of the FRB; (iii) inflation, interest rate, market and monetary fluctuations; (iv) the timely development of and acceptance of new products and services, (v) changes in consumer spending, borrowing and saving habits; (vi) increased competition in the Company's principal market area; (vii) technological changes; (viii) acquisitions; (ix) the effect of changes in laws and regulations, (x) the effect of changes in accounting policies and practices, and (xi) the costs and effects of litigation and of unexpected or adverse outcomes in such litigation. ITEM 2. PROPERTIES. The Company shares office space with the Bank. The Bank operates a total of five office locations. The Bank owns four of the buildings in which it conducts operations and each building is occupied solely by the Bank. All four buildings are designed for commercial banking operations and are suitable for current operations and anticipated future needs. Each facility contains teller and loan facilities and drive-up teller stations. One location occupies leased space within a supermarket. The leased space is designed for commerical banking operations containing teller and loan facilities. ITEM 3. LEGAL PROCEEDINGS. As of December 31, 1999, the Company was not involved in any legal proceedings, nor was it aware of any threatened litigation. In the ordinary course of its business, the Bank is engaged from time to time in legal actions as both a plaintiff and a defendant. In some cases, claims for significant compensatory or punitive damages, or unspecified damages, may be made against the Bank. As of the date of this report, the Bank was not a party to any legal or administrative proceedings which, in the opinion of Bank management, would have a material adverse effect on the financial condition of the Bank. As of the date of this report, no director, officer, affiliate of the Bank, or any associate of any such person, is an adverse party in any legal proceedings involving the Bank. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. No matters were submitted to a vote of the Company's shareholders during the fourth quarter of 1999. -6- PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS. MARKET There is no active public market for the Company's common stock. Transactions in the Company's common stock are sporadic and limited and prices have been determined by the buyer and seller. No data regarding the prices at which trades are made was published or otherwise publicly available until price quotations for the stock began on the OTC Bulletin Board under the symbol "PSBQ" on January 10, 2000. Management is not advised as to the terms of all transactions in the common stock. HOLDERS As of December 31, 1999 there were approximately 990 holders of record of the Company's common stock. DIVIDENDS Per share dividends declared by the Company in its two most recent fiscal years were:
1998 1999 Second Quarter $.35 $.38 Fourth Quarter $.58 $.62
The Company's source of funds for the payment of dividends is dividends paid by the Bank. The payment of future dividends to shareholders of the Company is within the discretion of the Company's Board of Directors and will depend on various factors, including the Company's earnings, capital requirements, and the financial condition of the Company. ITEM 6. SELECTED FINANCIAL DATA. The following table presents consolidated financial data of the Company and its subsidiary. This information and the following discussion and analysis should be read in conjunction with other financial information presented elsewhere in this report. -7-
YEARS ENDED DECEMBER 31 ($ in thousands, except per share amounts) 1999 1998 1997 1996 1995 CONSOLIDATED SUMMARY OF EARNINGS: Total interest income $ 17,671 $ 16,746 $ 15,744 $ 14,824 $ 13,653 Total interest expense 8,598 8,722 8,253 7,769 7,055 Provision for loan and lease losses 460 300 230 180 180 Net interest income after provision for loan and lease losses 8,613 7,724 7,261 6,875 6,418 Total other income 1,265 1,408 745 990 683 Total other expense (except income taxes) 6,221 6,115 4,932 4,715 4,190 Net income $ 2,589 $ 2,089 $ 2,103 $ 2,156 $ 2,020 Per Share: Basic and diluted Earnings per share $ 2.93 $ 2.36 $ 2.37 $ 2.39 $ 2.24 Common dividends declared 1.00 .93 .90 .85 .82 Other significant data: Return on average shareholders equity 12.31% 10.62% 11.15% 11.98% 12.15% Return on average assets 1.08% .96 1.02 1.10 1.13 Dividend payout ratio 34.12 39.33 37.85 35.40 36.63 Average equity to average assets ratio 8.75% 9.06 9.15 9.16 9.27 1999 1998 1997 1996 1995 CONSOLIDATED SUMMARY BALANCE SHEETS Total assets $ 259,889 $ 233,491 $ 215,019 $ 204,158 $ 190,781 Total deposits 202,354 199,800 186,603 178,129 160,444 Short-term borrowings 21,215 4,549 3,960 5,766 11,099 Long-term borrowings 13,000 6,000 3,000 0 0 Stockholders' equity 21,046 20,556 19,217 18,289 17,453 Other significant data: Book value per share at year end $ 23.83 $ 23.27 $ 21.76 $ 20.42 $ 19.34 Average common shares outstanding 883,235 883,235 887,988 900,641 902,425 Shareholders of record at year end 990 975 974 974 940 Employees at year end (FTE) 91 87 78 70 62 Historically reported credit quality ratios: Net loan and lease charge-offs to average loans and leases .19% .14% .22% .03% .04% Allowance for loan and lease losses to End of period loans and leases 1.15 1.27 1.24 1.39 1.42
-8- ITEM 7.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. The following discussion relates to Company and the Bank. Unless noted, references to the "Company" mean the Company and the Bank on a consolidated basis. Management's discussion and analysis contains forward-looking statements that are provided to assist in the understanding of anticipated future financial performance. However, such performance involves risks and uncertainties which may cause actual results to differ materially from those in such statements. For a discussion of certain factors that may cause such forward-looking statements to differ materially from actual results see Item 1, "- Cautionary Statement Regarding Forward-Looking Information." RESULTS OF OPERATIONS The Company's consolidated net income for 1999 was $2,588,982 compared with $2,088,577 in 1998, and $2,102,709 in 1997. Net income increased 23.96% in 1999 from 1998 and decreased .7% in 1998 from 1997. Results for 1998 included a pre-tax expense of $405,891 relating to the termination of our defined benefit pension plan. Return on average common stockholders' equity amounted to 12.31% in 1999 compared to 10.62% in 1998, and 11.15% in 1997. Return on average assets for 1999 amounted to 1.08% compared to .96% for 1998 and 1.02% in 1997. Net income per share amounted to $2.93 in 1999, compared to $2.36 in 1998 and $2.37 in 1997. Cash dividend declared in 1999 were $1.00 per share, compared to $.93 in 1998 and $.90 in 1997. The per share ratio of dividends to shareholders to net income was 34.12% in 1999, compared to 39.33% in 1998 and 37.85% in 1997. NET INTEREST INCOME The following table shows how net interest income is impacted by the change in volume and interest rates. 1999 and 1998 data shows a favorable spread due to increased volume. Growth in net interest income will continue to be moderate and interest margins will need to be managed carefully during 2000. -9- INTEREST INCOME & EXPENSE VOLUME & RATE CHANGE
1999 compared to 1998 1998 compared to 1997 increase (decrease) increase (decrease) due to (1) due to (1) ($ in thousands) VOLUME RATE NET VOLUME RATE NET Interest earned on: Loans (2) $ 1,362 (696) 666 $ 706 10 716 Taxable investment securities 445 (18) 427 110 (86) 24 Non-taxable investment securities (2) 58 (21) 37 88 (20) 68 Other interest income (183) (5) (188) 436 (217) 219 Total 1,682 (740) 942 1,340 (313) 1,027 Interest paid on: Savings and demand deposits 509 (178) 331 335 179 514 Time deposits (440) (482) (922) (108) (102) (210) Short-term borrowings 465 (62) 403 (71) (35) (106) Long-term borrowings 87 (23) 64 265 6 271 Total 621 (745) (124) 421 48 469 Net interest earnings $ 1,061 5 1,066 $ 919 (361) 558 (1)The change in interest due to both rate and volume has been allocated to volume and rate changes in proportion to the relationship of the absolute dollar amounts of change in each. (2)The amount of interest income on non-taxable loans and investment securities has been adjusted to its fully taxable equivalent using a 34% tax rate.
The following table demonstrates how the changing interest rate environment affected the net yield on earning assets (on fully tax equivalent basis) for the three-year period ending December 31, 1999.
Year Ended December 31, 1999 1998 1997 Yield Change Yield Change Yield Change Yield on earning assets 7.96% - .31% 8.27% - .09% 8.36% .09% Effective rate on all liabilities as a % of earning assets 3.80 - .43 4.23 - .06 4.29 .04 Net yield on earning assets 4.16 .12 4.04 - .03 4.07 .05
-10- The 1999 figures as a percent of average earning assets reflects a decrease in interest rates during 1999. The Company will focus on increasing net interest income in 2000 through continued control of interest expense, maintaining the level of interest rates on loans, and managing rates on the investment portfolio. Average earning assets increased 9.49% to $226,082 in 1999, from $206,480 in 1998. Included in this increase was a 10.16% increase in average loans to $163,929 in 1999, up from $148,806 in 1998, and an 18.82% increase in average taxable investments to $47,091 in 1999, up from $39,631 in 1998. Federal funds sold decreased an average of 82.45% in 1999 from 1998. The following table sets forth average consolidated balance sheet data and average rate data on a tax equivalent basis for the periods, indicated. -11-
DISTRIBUTION OF ASSETS, LIABILITIES AND STOCKHOLDERS' EQUITY INTEREST RATES AND DIFFERENTIALS 1999 1998 1997 Average Yield/ Average Yield/ Average Yield/ ($ IN THOUSANDS) BALANCE INTEREST RATE BALANCE INTEREST RATE BALANCE INTEREST RATE Assets Interest earning assets: Loans (1)(2)(3) $163,929 $14,065 8.58% $148,806 $13,404 9.01% $140,962 $12,692 9.00% Taxable investment securities 47,091 2,912 6.18% 39,631 2,470 6.23% 37,877 2,427 6.41% Nontaxable investment securities(2) 14,251 985 6.91% 13,423 947 7.06% 12,197 879 7.21% Federal funds sold 811 44 5.43% 4,620 248 5.37% 890 48 5.39% Total (2) 226,082 18,006 7.96% 206,480 17,069 8.27% 191,926 16,046 8.36% Non-interesting earning assets: Cash and due from banks 8,694 8,497 8,347 Premises & equip. - net 3,892 3,949 3,660 Other assets 3,843 3,578 3,981 Less: allow. loan loss (2,085) (1,929) (1,846) Total 240,426 220,575 206,068 Liabilities & Stockholders' Equity Interest bearing liabilities: Savings and demand deposits 74,835 2,712 3.62% 61,657 2,381 3.86% 52,265 1,867 3.57% Time deposits 93,069 4,873 5.24% 100,713 5,795 5.75% 102,566 6,005 5.85% Short-term borrowings 11,661 640 5.49% 3,803 237 6.23% 5,556 343 6.18% Long-term borrowings 7,168 373 5.20% 5,724 309 5.40% 638 38 5.96% Total 186,733 8,598 4.60% 171,897 8,722 5.07% 161,025 8,253 5.13% Non-interest bearing liabilities: Demand deposits 30,616 26,827 24,403 Other liabilities 2,039 1,875 1,788 Stockholders' equity 21,038 19,976 18,852 Total 240,426 220,575 206,068 Net interest income 9,408 8,347 7,793 Rate spread 3.36% 3.20% 3.23% Net yield on interest earnings assets 4.16% 4.04% 4.07% (1)For purposes of these computations, non-accruing loans are included in the daily average loan amounts outstanding. (2)The amount of interest income on non-taxable investment securities and loans has been adjusted to its fully taxable equivalent, using a federal tax rate of 34%. (3)Loan fees are included in total interest income as follows: 1999-$172, 1998-$155, 1997-$164, 1996-$80, 1995-$55.
-12- The preceding table shows a 1999 increase of .12% in net yield on interest earning assets. The average rate on taxable investment securities decreased .5% in 1999 to 6.18%, down from 6.23% in 1998. Time deposits rates decreased by .51% while funds shifted into the more liquid Money Market deposit accounts, which the Company continued to offer throughout 1999 in an effort to retain deposits to support loan demand. Total deposits at December 31, 1999 showed an increase of $2,554 increasing to $202,354 from 199,800 at December 31, 1998. Average borrowing increased $9,302 increasing from $9,527 in 1998 to $18,829 in 1999. The average rate on all interest bearing liabilities decreased by .47% in 1999 to 4.60% down from 5.07% in 1998. Loan growth is expected to increase again 2000 due to the increase in fixed rate and in- house home equity loan products being offered and promoted. The sale of additional real estate loans in the secondary market will also provide increased loan fee income.
Year Ended December 31, 1999 1998 1997 1996 1995 Item of income Interest and fees on loans and short-term borrowings 74.3% 73.8% 76.9% 74.3% 75.2% Interest on securities 18.3% 16.6% 17.9% 18.2% 18.8% Total operating income 18,936 18,153 16,489 15,814 14,336 (000's omitted)
The bank does not have any foreign deposits or operations NON-INTEREST INCOME The following table shows the major components of non-interest income.
($ in thousands) 1999 1998 1997 Noninterest income: Service fees $709 $699 $484 Net realized gain on sale of securities available for sale 36 3 Gain on sale of loans 223 332 46 Gain on sale of other real estate 21 4 Investment sales commissions 138 147 74 Other operating income 174 189 138 Total noninterest income 1,265 1,407 745
-13- Service fees continued to increase to $709 in 1999, compared to $699 in 1998 primarily due to profit improvement initiative implemented back in 1998. -13- NON-INTEREST EXPENSE The following table shows the major components of non-interest expense.
($ in thousands) 1999 1998 1997 Salaries and employee benefits $3,621 $3,331 $2,948 Loss on settlement on pension plan 406 Occupancy 859 828 728 Data processing and other office operations 441 421 319 Advertising and promotion 222 202 166 Director compensation and benefits 170 142 180 Other operating 908 785 591 Total noninterest expense $6,221 $6,115 $4,932
Salaries increased $290 primarily due to the increased number of employees. The number of full-time equivalent employees at the end of 1999 was 91 compared to 87 at the end of 1998. Occupancy expense increased in 1999 due various remodeling projects increasing office space. Data processing costs increased by 4.8% in 1999 compared to 1998 as a result of additional computer systems added to the in-house system and Y2K costs. Other operating expense increased in 1999 due to an increase in educational, marketing, and charitable contribution expense. PROVISIONS FOR LOAN LOSSES Management determines the adequacy of the allowance for loan losses based on past loan experience, current economic conditions, composition of the loan portfolio, and the potential for future loss. Accordingly, the amount charged to expense is based on management's evaluation of the loan portfolio. It is the Company's policy that when available information confirms that specific loans, or portions thereof, including impaired loans, are uncollectible, these amounts are promptly charged off against the allowance. The provision for loan losses was $460,000 in 1999; compared to $300,000 in 1998 and $230,000 in 1997. The allowance for loan losses as a percentage of gross loans outstanding was 1.15% at December 31, 1999; 1.27% at December 31, 1998; and 1.24% at December 31, 1997. The increased provision in 1999 is intended to provide adequate reserves for potential losses. Charge-offs as a percentage of average loans outstanding were .19% in 1999; .13% in 1998; and .22% in 1997. Charge-offs have not been concentrated in any industry or business segment as reflected in the schedule below. -14- Management feels the allowance for loan losses is adequate as of December 31, 1999. The allowance for loan losses shown in the following table represents a general allowance available to absorb future losses within the entire portfolio.
($ in thousands) YEAR ENDED DECEMBER 31 1999 1998 1997 1996 1995 Average balance of loans for period $163,929 $148,806 $140,962 $130,783 $119,657 Allowance for loan losses at beginning of period $ 1,947 $ 1,845 $ 1,925 $ 1,781 $ 1,644 Loans charged off Commercial & Industrial (322) (138) (156) (48) (54) Agriculture 0 0 0 0 0 Real Estate - Mortgage (72) 0 (136) 0 0 Installment & Other Consumer Loans (38) (69) (59) (25) (15) Total Charge Offs (432) (207) (351) (73) (69) Recoveries on loans previously charged off Commercial & Industrial 67 0 17 33 22 Agricultural 0 0 0 0 0 Real Estate - Mortgage 7 0 19 0 0 Installment & Other Consumer Loans 50 9 5 4 4 Total Recoveries $124 $9 $41 $37 $26 Net loans charged off ($308) ($198) ($310) ($36) ($43) Additions charged to operations 460 300 230 180 180 Allowance for loan losses at end of period $ 2,099 $ 1,947 $ 1,845 $ 1,925 $ 1,781 Ratio of net charge offs during period to average loans outstanding 0.19% 0.13% 0.22% 0.03% 0.04% Ratio of allowance for loan losses to total loans receivable at end of period 1.15% 1.27% 1.24% 1.39% 1.42%
-15- LIQUIDITY AND INTEREST SENSITIVITY The Company's Asset Liability Management process provides an approach to management of liquidity, capital and interest rate risk, and to provide adequate funds to support the borrowing requirements and deposit flow of its customers. Management views liquidity as the ability to raise cash at a reasonable cost or with a minimum of loss and as a measure of balance sheet flexibility to react to market-place, regulatory, and competitive changes. The primary sources of the Company's liquidity are marketable assets maturing within one year. The Company attempts, when possible to match relative maturities of assets and liabilities, while maintaining the desired net interest margin. Management believes liquidity is adequate. Management's overall strategy is to coordinate the volume of rate sensitive assets and liabilities to minimize the impact of interest rate movement on the net interest margin. From time to time, the Bank develops special term deposit products that will attract present and potential customers. A significant portion of consumer deposits do not reprice or mature on a contractual basis. These deposit balances and rates are considered to be core deposits since these balances are generally not susceptible to significant interest rate changes. The Bank's Asset Liability Committee distributes these deposits over a number of periods to reflect those portions of such accounts that are expected to reprice fully with market rates over the simulation period. The assumptions are based on historical experience with the Bank's individual markets and customers and include projections for how management expects to continue to price in response to marketplace and market changes. However, markets and consumer behavior do change, and adjustments are necessary as customer preferences, competitive market conditions, liquidity, loan growth rates, and mix change. Management considers that an acceptable ratio for the rate sensitive assets to rate sensitive liabilities during periods of extended and less volatile rate increases or decreases between .75 and 1.25. The Bank is to generally maintain a one-year ratio of 1.00 - i.e., balanced ratio. At December 31, 1999 and 1998 the Company was within the ratio limits. -16- INVESTMENT PORTFOLIO The following table shows the relative maturities of the investment portfolio as of December 31, 1999. Weighted average yields on tax-exempt securities have been calculated on a tax equivalent basis using a tax rate of 34%. Yields on securities available for sale are calculated based on amortized cost.
After one After two After five Within but within but within but within Over ONE YEAR TWO YEARS FIVE YEARS TEN YEARS TEN YEARS ($ in thousands) AMOUNT YIELD AMOUNT YIELD AMOUNT YIELD AMOUNT YIELD AMOUNT YIELD U.S. Treasury $ -- -- $ 497 4.60% $ -- -- $ -- -- $ -- -- U.S. Government agencies and corporations 3,310 5.94% 3,458 5.95% 10,600 6.03% 16,022 6.18% 11,855 6.20% State and political subdivisions (domestic) 1,291 7.54% 755 6.83% 3,230 7.01% 8,567 6.73% -- -- Other equity securities 747 6.30% -- -- -- -- -- -- -- -- Total $ 5,348 6.39% $ 4,710 5.95% $13,830 6.25% $24,589 6.36% $11,855 6.20%
The Company follows Statement of Financial Accounting Standards No. 115, "Accounting for Certain Investments in Debt and Equity Securities" (SFAS 115), which specifies the accounting for investments in securities that have readily determinable fair values. The Bank classifies all U.S. Treasury and other U.S. Government Agencies & Corporations as available-for-sale. State and Political subdivisions were classified as held-to maturity. At December 31, 1999 the net unrealized loss on securities available for sale, recorded as a separate component of stockholder's equity, was $1,043,128, net of deferred income taxes of $460,774. Securities with an approximate carrying value of $20,207,957 and $9,168,461, at December 31, 1999 and 1998 respectively, were pledged primarily to secure public deposits and for repurchase agreements. -17- The following table sets forth the distribution of investment securities as of the dates indicated.
($ in thousands) DECEMBER 31 1999 1998 1997 U.S. Treasury and other U.S. Government agencies and corporations $ 45,742 $ 47,185 $ 36,932 State and political subdivisions (domestic) 13,843 14,068 12,549 Other equity securities 747 701 647 Total $ 60,332 $ 61,954 $ 50,128
An investment subsidiary, PSB Investments, Inc. currently holds approximately $40,195,524 in securities. Income tax expense was approximately $117,000 lower as a result of holding these securities at the subsidiary. LOAN PORTFOLIO The following table sets forth the approximate maturities of the loan portfolios and the sensitivity of loans to interest changes as of December 31, 1999.
MATURITY Over one ($ in thousands) One year year thru Over OR LESS FIVE YEARS FIVE YEARS Commercial, industrial, and financial $ 25,459 $ 22,476 $ 869 Agricultural 1,145 1,102 2 Real estate mortgage 43,464 72,760 1,971 Installment & other consumer loans 3,135 7,680 2,560 Total $ 73,203 $104,018 $ 5,402
INTEREST SENSITIVITY Amounts of loans due after one year with: Fixed Variable ($ in thousands) RATE RATE Commercial, industrial, and financial $ 23,345 $ 0 Agriculture 1,104 0 Real estate mortgage 66,608 8,123 Installment & other consumer loans 10,240 0 Total $101,297 $ 8,123
-18- Loan growth for the year ended December 31, 1999 was 18.86%; increasing from $153,649,105 at December 31, 1998 to $182,623,354 at December 31, 1999. The composition of loans outstanding as of the dates indicated are as follows:
($ in thousands) DECEMBER 31 1999 1998 1997 1996 1995 Commercial, industrial and financial $ 48,804 $ 38,852 $ 31,314 $ 28,531 $ 27,291 Agricultural 2,249 1,662 2,488 1,820 2,356 Real estate mortgage 118,195 101,380 103,253 93,450 84,221 Installment and other consumer loans 13,375 11,755 12,262 14,210 11,457 Total $182,623 $153,649 $149,317 $138,011 $125,325
There were no loans held for sale as of December 31, 1999 compared to $3,120,450 on December 31, 1998. The composition of loans in the loan portfolio shows an increase in installment and other consumer loans. All other loan categories have been steadily increasing every year. The Company has no foreign loans outstanding. The Company's process for monitoring loan quality includes monthly analysis of delinquencies, risk element loans and potential problem loans. The Company's policy is to place loans on a non-accrual status when they become contractually past due 90 days or more as to interest or principal payments. All interest accrued (including applicable impaired loans) but not collected for loans that are placed on nonaccrual or charged off is reversed to interest income. The interest on these loans is accounted for on the cash basis until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due have been collected and there is reasonable assurance that repayment will continue within a reasonable time frame. A loan is impaired when, based on current information, it is probable that the Company will not collect all amounts due in accordance with the contractual terms of the loan agreement. Impairment is based on discounted cash flows of expected future payments using the loan's initial effective interest rate or the fair value of the collateral if the loan is collateral dependent. -19- An analysis of impaired loans follows:
($ in thousands) AT DECEMBER 31, 1999 1998 1997 Nonaccrual $ 510 $ 564 $ 484 Accruing income 1,696 406 640 Total impaired loans 2,206 970 1,124 Less - Allowance for loan losses 297 328 178 Net investment in impaired loans $1,909 $642 $ 946
($ in thousands) YEARS ENDED DECEMBER 31, 1999 1998 1997 Average recorded investment, net of allowance for loan losses $1,874 $ 820 $1,191 Interest income recognized $ 118 $ 40 $ 83
The Company maintained generally high loan quality during 1999. The following table sets forth the amount of risk element loans as of the dates indicated.
($ in thousands) DECEMBER 31 1999 1998 1997 1996 1995 Loans on a non-accrual basis $ 620 $ 582 $ 835 $ 247 $ 376 Loans contractually past due ninety days or more as to interest or principal payments $ 0 $ 0 $ 7 $ 275 $ 0
-20- DEPOSITS The average balances of deposits and the average rate paid on these deposits during the years ended December 31, 1999, 1998, and 1997 are:
($ in thousands) 1999 1998 1997 BALANCE RATE BALANCE RATE BALANCE RATE Non-interest bearing demand deposits $ 30,616 $ 26,827 $ 24,403 Interest bearing demand and savings deposits 74,835 3.62% 61,657 3.86% 52,265 3.57% Time deposits 93,069 5.24% 100,713 5.75% 102,566 5.85% Total $198,520 $189,197 $ 179,234
The amount of time certificates of deposit issued in amounts of $100,000 or more and outstanding as of December 31, 1999 is approximately $29,127,000. Their maturity distribution as of December 31, 1999 and 1998 is as follows:
(in thousands) 1999 1998 - three months or less $ 10,346 $ 11,420 - over three months through six months $ 12,324 $ 11,001 - over six months through twelve months $ 5,381 $ 4,804 - over one year through five years $ 1,076 $ 1,663 - over five years $ 0 $ 0
The Bank does not have any deposits in foreign banking offices. SHORT-TERM BORROWINGS Information related to the Bank's funds purchased and security repurchase agreements for the last three years is as follows:
($ in thousands) 1999 1998 1997 Amount outstanding at year end $21,215 $ 4,550 $ 3,960 Average amount outstanding during the year 11,661 3,803 5,556 Maximum amount outstanding at any month's end 21,215 5,220 11,983 Weighted average interest rate at year end 5.90% 5.63% 6.14% Weighted average interest rate during the year 5.49% 6.23% 6.18%
-21- SUMMARY QUARTERLY FINANCIAL INFORMATION The following is a summary of the quarterly results of operations for the years ended December 31, 1999, 1998 and 1997.
Three months ended March 31 June 30 September 30 December 31 ($ in thousands, except per share data) 1999 Interest income $4,179 $4,281 $4,547 $4,664 Interest expense $2,050 $2,093 $2,208 $2,247 Net interest income $2,129 $2,188 $2,339 $2,417 Provision for loan losses $75 $75 $105 $205 Net income applicable to common stock $635 $722 $759 $473 Earnings per common share $0.72 $0.82 $0.86 $0.53 1998 Interest income $4,146 $4,288 $4,252 $4,060 Interest expense $2,164 $2,174 $2,205 $2,179 Net interest income $1,982 $2,114 $2,047 $1,882 Provision for loan losses $75 $75 $75 $75 Net income applicable to common stock $390 $638 $719 $342 Earnings per common share $0.44 $0.72 $0.81 $0.39 1997 Interest income $3,757 $3,898 $3,977 $4,112 Interest expense $1,978 $2,041 $2,088 $2,146 Net interest income $1,779 $1,857 $1,889 $1,966 Provision for loan losses $45 $45 $65 $75 Net income applicable to common stock $581 $561 $626 $335 Earnings per common share $0.65 $0.63 $0.70 $0.39
STOCK REPURCHASE On December 21, 1999, the Company authorized the repurchase of up to 45,000 shares of its common stock. As of December 31, 1999, no shares had been purchased under the authorization. YEAR 2000 DISCLOSURE YEAR 2000 The Company's Year 2000 Project was intended to address Year 2000 problems and prevent major interruptions in its business due to problems related to the Company's computerized financial and -22- information systems. As part of its program, the Company's Year 2000 Project Committee conducted an assessment of its financial and information systems, third party vendors, and customers. The Company did not experience any significant disruption as a result of Year 2000 problems. As of March 21, 2000, neither the Company nor any of its key vendors or customers have experienced any material adverse effects related to Year 2000 problems. Based on its experience in the Year 2000 transition and its business operations through such date, the Company does not expect to encounter any year 2000 problems that would have a material adverse effect on the results of operations, liquidity and financial condition of the Company. The costs of achieving year 2000 readiness were approximately $13,573 and $11,476 in 1999 and 1998 respectively, exclusive of internal costs. Internal costs for Year 2000 readiness were not tracked, but principally related to payroll costs of Company personnel. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. Market risk is the risk of loss from adverse changes in market prices and rates. The Company's market risk arises primarily from interest-rate risk inherent in its lending and deposit taking activities. Management actively monitors and manages its interest-rate risk exposure. The measurement of the market risk associated with financial instruments is meaningful only when all related and offsetting on- and off-balance sheet transactions are aggregated, and the resulting net positions are identified. Disclosures about the fair value of financial instruments at December 31, 1999, which reflect changes in market prices and rates, can be found in footnote 17 of the Notes to Consolidated Financial Statements. The Company's primary objective in managing interest-rate risk is to minimize the adverse impact of changes in interest rates on the Company's net interest income and capital, while adjusting the Company's asset-liability structure to obtain the maximum yield-cost spread on that structure. The Company relies primarily on its asset-liability structure to control interest-rate risk. However, a sudden and substantial increase in interest rates may adversely impact the Company's earnings, to the extent that the interest rates borne by assets and liabilities do not change at the same speed, to the same extent, or on the same basis. The Company does not engage in trading activities. The Company believes that it does not have a material exposure to interest-rate risk. Additional information required by this Item 7A is set forth in Item 6, "Selected Financial Data" and under subcaptions "Results of Operations", "Net Interest Income", "Provision for Loan Losses", "Liquidity and Interest Sensitivity", "Investment Portfolio", and "Deposits" under Item 7, Management's Discussion and Analysis of Financial Conditions. -23- ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA. INDEPENDENT AUDITOR'S REPORT Board of Directors PSB Holdings, Inc. Wausau, Wisconsin We have audited the accompanying consolidated balance sheets of PSB HOLDINGS, INC. and Subsidiary as of December 31, 1999 and 1998, and the related consolidated statements of income, changes in stockholders' equity, and cash flows for the three years ended December 31, 1999. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of PSB HOLDINGS, INC. and Subsidiary at December 31, 1999 and 1998, and the results of their operations and their cash flows for the three years ended December 31, 1999 in conformity with generally accepted accounting principles. WIPFLI ULLRICH BERTELSON LLP Wipfli Ullrich Bertelson LLP January 21, 2000 Wausau, Wisconsin -24-
PSB HOLDINGS, INC. AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS December 31, 1999 and 1998 1999 1998 ASSETS Cash and due from banks $ 11,925,985 $ 8,751,763 Interest-bearing deposits and money market funds 61,779 740,993 Federal funds sold 3,934,000 Securities: Held to maturity (fair values of $13,472,511 and $14,345,897, respectively) 13,843,068 14,068,362 Available for sale (at fair value) 46,489,186 47,886,132 Loans held for sale 3,120,450 Loans receivable, net of allowance for loan losses of $2,099,241 and $1,946,864 in 1999 and 1998, respectively 180,524,113 148,581,791 Accrued interest receivable 1,746,038 1,725,343 Premises and equipment 3,897,223 3,885,986 Other assets 1,401,641 796,671 TOTAL ASSETS $ 259,889,033 $ 233,491,491 LIABILITIES AND STOCKHOLDERS' EQUITY Noninterest-bearing deposits $ 33,657,598 $ 33,149,909 Interest-bearing deposits 168,696,643 166,649,988 Total deposits 202,354,241 199,799,897 Short-term borrowings 21,214,890 4,549,508 Long-term borrowings 13,000,000 6,000,000 Other liabilities 2,273,485 2,585,871 Total liabilities 238,842,616 212,935,276 Stockholders' equity: Common stock - No-par value with a stated value of $2 per share: Authorized - 1,000,000 shares Issued - 902,425 shares 1,804,850 1,804,850 Additional paid-in capital 7,158,505 7,158,505 Retained earnings 13,928,790 12,223,043 Accumulated other comprehensive income (loss), net of tax (1,043,128) 172,417 Treasury stock, at cost - 19,190 shares (802,600) (802,600) Total stockholders' equity 21,046,417 20,556,215 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 259,889,033 $ 233,491,491 See accompanying notes to consolidated financial statements.
-25-
PSB HOLDINGS, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF INCOME Years Ended December 31, 1999, 1998, and 1997 1999 1998 1997 Interest income: Interest and fees on loans $ 14,065,041 $ 13,403,646 $ 12,688,023 Interest on securities: Taxable 2,821,551 2,394,816 2,370,859 Tax-exempt 649,901 625,427 580,323 Other interest and dividends 134,512 322,546 104,758 Total interest income 17,671,005 16,746,435 15,743,963 Interest expense: Deposits 7,584,588 8,175,617 7,871,730 Short-term borrowings 639,760 237,059 343,207 Long-term borrowings 373,416 308,913 37,981 Total interest expense 8,597,764 8,721,589 8,252,918 Net interest income 9,073,241 8,024,846 7,491,045 Provision for loan losses 460,000 300,000 230,000 Net interest income after provision for loan losses 8,613,241 7,724,846 7,261,045 Noninterest income: Service fees 708,794 699,145 483,756 Net realized gain on sale of securities available for sale 35,867 3,120 Gain of sale of loans 223,002 332,027 45,588 Investment sales commissions 137,621 146,756 73,873 Other operating income 195,230 192,903 138,367 Total noninterest income 1,264,647 1,406,698 744,704 Noninterest expenses: Salaries and employee benefits 3,621,239 3,330,964 2,948,292 Loss on settlement of pension plan 405,891 Occupancy 858,719 827,558 727,583 Data processing and other office operations 440,588 421,488 319,453 Advertising and promotion 222,435 201,754 166,415 Director compensation and benefits 169,820 141,671 179,800 Other operating 908,605 785,641 590,497 Total noninterest expenses 6,221,406 6,114,967 4,932,040 Income before income taxes 3,656,482 3,016,577 3,073,709 Provision for income taxes 1,067,500 928,000 971,000 Net income $ 2,588,982 $ 2,088,577 $ 2,102,709 Basic and diluted earnings per share $ 2.93 $ 2.36 $ 2.37 Weighted average shares outstanding 883,235 883,235 887,988 See accompanying notes to consolidated financial statements.
-26-
PSB HOLDINGS, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY Years Ended December 31, 1999, 1998, and 1997 Accumulated Additional Other Common Paid-In Retained Comprehensive Treasury STOCK CAPITAL EARNINGS INCOME (LOSS) STOCK TOTALS Balance, January 1, 1997 $1,804,850 $ 7,158,505 $ 9,649,112 $ (8,543) $ (315,000) $18,288,924 Comprehensive income: Net income 2,102,709 2,102,709 Unrealized gain on securities available for sale, net of tax 109,086 109,086 Total comprehensive income 2,211,795 Purchase of treasury stock (487,600) (487,600) Cash dividends declared $.90 per share (795,944) (795,944) Balance, December 31, 1997 1,804,850 7,158,505 10,955,877 100,543 (802,600) 19,217,175 Comprehensive income: Net income 2,088,577 2,088,577 Unrealized gain on securities available for sale, net of tax 71,874 71,874 Total comprehensive income 2,160,451 Cash dividends declared $.93 per share (821,411) (821,411) Balance, December 31, 1998 1,804,850 7,158,505 12,223,043 172,417 (802,600) 20,556,215 Comprehensive income: Net income 2,588,982 2,588,982 Unrealized loss on securities available for sale, net of tax (1,215,545) (1,215,545) Total comprehensive income 1,373,437 Cash dividends declared $1.00 per share (883,235) (883,235) Balance, December 31, 1999 $1,804,850 $ 7,158,505 $ 13,928,790 $(1,043,128) $ (802,600) $21,046,417 See accompanying notes to consolidated financial statements. -27-
PSB HOLDINGS, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS Years Ended December 31, 1999, 1998, and 1997 1999 1998 1997 Cash flows from operating activities: Net income $ 2,588,982 $ 2,088,577 $ 2,102,709 Adjustments to reconcile net income to net cash provided by operating activities: Provision for depreciation and net amortization 554,059 520,981 482,664 Benefit from deferred income taxes (70,000) (169,900) (108,900) Provision for loan losses 460,000 300,000 230,000 Proceeds from sales of loans held for sale 21,214,462 26,186,442 4,369,580 Originations of loans held for sale (17,871,010) (28,674,365) (4,344,817) Gain on sale of loans (223,002) (332,027) (45,588) Net gain on sale of other real estate (21,461) (4,134) Net gain on sale of securities available for sale (35,867) (3,120) Changes in operating assets and liabilities: Accrued interest receivable (20,695) 12,150 53,412 Other assets (109,686) (25,811) (285,484) Other liabilities 239,166 346,744 265,173 Net cash provided by operating activities 6,262,483 212,790 2,715,629 Cash flows from investing activities: Proceeds from sale and maturities of: Held to maturity securities 2,865,000 1,340,000 2,366,913 Available for sale securities 13,262,495 17,470,126 10,953,084 Payment for purchase of: Held to maturity securities (2,664,188) (2,881,464) (3,221,710) Available for sale securities (13,653,389) (27,616,227) (8,496,561) Net increase in loans (32,402,322) (1,709,893) (11,595,126) Net (increase) decrease in interest-bearing deposits and money market funds 679,214 (587,722) 16,032 Net decrease (increase) in federal funds sold 3,934,000 (3,934,000) Capital expenditures (522,284) (633,488) (482,177) Proceeds from sale of other real estate 76,722 503,667 Net cash used in investing activities (28,424,752) (18,049,001) (10,459,545) Cash flows from financing activities: Net increase (decrease) in noninterest-bearing deposits 507,689 5,585,407 (921,753) Net increase in interest-bearing deposits 2,046,655 7,611,785 9,395,555 Net increase (decrease) in short-term borrowings 16,665,382 589,466 (1,806,589) Proceeds from issuance of long-term borrowings 10,000,000 3,000,000 3,000,000 Repayments of long-term borrowings (3,000,000) Dividends paid (883,235) (821,411) (795,944) Purchase of treasury stock (487,600) Net cash provided by financing activities 25,336,491 15,965,247 8,383,669 Net increase (decrease) in cash and due from banks 3,174,222 (1,870,964) 639,753 Cash and due from banks at beginning 8,751,763 10,622,727 9,982,974 Cash and due from banks at end $ 11,925,985 $ 8,751,763 $ 10,622,727 Supplemental cash flow information: Cash paid during the year for: Interest $ 8,738,300 $ 8,734,905 $ 8,101,757 Income taxes 1,416,524 877,563 1,008,124 Noncash investing and financing activities: Loans charged off 432,444 207,450 350,242 Loans transferred to other real estate 79,457 198,544 300,989
See accompanying notes to consolidated financial statements. -28- NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES PRINCIPAL BUSINESS ACTIVITY PSB Holdings, Inc. and Subsidiary (the "Company"), operates Peoples State Bank (the "Bank"), a full service financial institution with a primary marketing area including, but not limited to, the greater Wausau, Wisconsin area and Marathon County, and Rhinelander, Wisconsin in Oneida County. It provides a variety of banking products including investment product sales and long-term fixed rate residential mortgages. PRINCIPLES OF CONSOLIDATION All significant intercompany balances and transactions have been eliminated. The accounting and reporting policies of the Company conform to generally accepted accounting principles and to the general practices within the banking industry. USE OF ESTIMATES IN PREPARATION OF FINANCIAL STATEMENTS The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. CASH EQUIVALENTS For the purpose of presentation in the consolidated statements of cash flows, cash and cash equivalents are defined as those amounts included in the balance sheet caption "cash and due from banks." Cash and due from banks includes cash on hand and non-interest-bearing deposits at correspondent banks. SECURITIES Investment securities are assigned an appropriate classification at the time of purchase in accordance with management's intent. Securities held to maturity represent those securities for which the Company has the positive intent and ability to hold to maturity. Accordingly, these securities are carried at cost adjusted for amortization of premium and accretion of discount calculated using the effective yield method. Unrealized gains and losses on securities held to maturity are not recognized in the financial statements. Trading securities include those securities bought and held principally for the purpose of selling them in the near future. The Company has no trading securities. Securities not classified as either securities held to maturity or trading securities are considered available for sale and reported at fair value determined from estimates of brokers or other sources. Unrealized gains and losses are excluded from earnings but are reported as other comprehensive income, net of income tax effects, in a separate component of stockholders' equity. Any gains and losses on sales of securities are recognized at the time of sale using the specific identification method. -29- INTEREST AND FEES ON LOANS Interest on loans is credited to income as earned. Interest income is not accrued on loans where management has determined collection of such interest doubtful. When a loan is placed on nonaccrual status, previously accrued but unpaid interest deemed uncollectible is reversed and charged against current income. Fees received on loans are credited to income when received. After being placed on nonaccrued status, additional income is recorded only to the extent that payments are received or the collection of principal becomes reasonably assured. Interest income recognition on impaired loans is consistent with the recognition on all other loans (as detailed above). ALLOWANCE FOR LOAN LOSSES The allowance for loan losses is established through a provision for loan losses charged to expense. Loans are charged against the allowance for loan losses when management believes that the collectibility of principal is unlikely. Management believes the allowance for loan losses is adequate to cover probable credit losses relating to specifically identified loans, as well as probable credit losses inherent in the balance of the loan portfolio. In accordance with current accounting standards, the allowance is provided for losses that have been incurred as of the balance sheet date. The allowance is based on past events and current economic conditions, and does not include the effects of expected losses on specific loans or groups of loans that are related to future events or expected changes in economic conditions. While management uses the best information available to make its evaluation, future adjustments to the allowance may be necessary if there are significant changes in economic conditions. A loan is impaired when it is probable the creditor will be unable to collect all contractual principal and interest payments due in accordance with terms of loan agreement. Impaired loans are measured based on the present value of expected future cash flows discounted at the loan's effective interest rate or, as a practical expedient, at the loanss observable market price or the fair value of the collateral if the loan is collateral dependent. In addition, various regulatory agencies periodically review the allowance for loan losses. These agencies may require the subsidiary Bank to make additions to the allowance for loan losses based on their judgments of collectibility based on information available to them at the time of their examination. LOANS HELD FOR SALE Mortgage loans originated and intended for sale in the secondary market are carried at the lower of cost or estimated market value in the aggregate. Net unrealized losses are recognized through a valuation allowance by charges to income. Gains and losses on the sale of loans held for sale are determined using the specific identification method using quoted market prices. Mortgage servicing rights are not retained. PREMISES AND EQUIPMENT Premises and equipment are stated at cost. Maintenance and repair costs are charged to expense as incurred. Gains or losses on disposition of property and equipment are reflected in income. Depreciation is computed principally on the straight-line method and is based on the estimated useful lives of the assets varying from 5 to 40 years on buildings, 5 to 20 years on equipment, and 3 years on software. FORECLOSED REAL ESTATE Real estate properties acquired through, or in lieu of, loan foreclosure are to be sold and are initially recorded at fair value at the date of foreclosure, establishing a new cost basis. Costs related to development and improvement of property are capitalized, whereas costs related to holding property are expensed. After foreclosure, valuations are periodically performed by management and the real estate is carried at the lower of carrying amount or fair -30- value less estimated costs to sell. Revenue and expenses from operations and changes in any valuation allowance are included in loss on foreclosed real estate. RETIREMENT PLANS The Company maintains a defined contribution 401(k) profit-sharing plan which covers substantially all full-time employees. INCOME TAXES Deferred income taxes have been provided under the liability method. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities as measured by the enacted tax rates which will be in effect when these differences are expected to reverse. Deferred tax expense is the result of changes in the deferred tax asset and liability. ADVERTISING AND PROMOTIONAL COSTS Costs relating to Company advertising and promotion are generally expensed when paid. EARNINGS PER SHARE Earnings per share are based upon the weighted average number of shares outstanding. RECLASSIFICATIONS Certain prior year balances have been reclassified to conform to current year presentation. -31- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 2 - CHANGES IN ACCOUNTING PRINCIPLES Effective January 1, 1998, the Company adopted Statement of Financial Accounting Standards (SFAS) No. 130, "Reporting Comprehensive Income." Under this SFAS, the Company reports those items defined as comprehensive income in the statement of changes in stockholders' equity. The adoption of SFAS No. 130 did not have an impact on the Company's financial condition or results of operations. Effective January 1, 1998, the Company adopted SFAS No. 132, "Employers' Disclosures about Pensions and Other Postretirement Benefits," which was issued in February 1998. This statement revises employers' disclosures about pension and other postretirement benefit plans. It did not change the measurement or recognition of those plans. It standardized the disclosure requirement and required additional information on changes in benefit obligations and fair value of plan assets, and eliminated certain disclosures which were no longer considered useful. The disclosure requirements had no impact on the Company's financial position or results of operations. NOTE 3 - CASH AND DUE FROM BANKS Cash and due from banks in the amount of $916,000 was restricted at December 31, 1999 to meet the reserve requirements of the Federal Reserve System. In the normal course of business, the Company and its subsidiary maintain cash and due from bank balances with correspondent banks. Accounts at each institution are insured by the Federal Deposit Insurance Corporation up to $100,000. The Company and its subsidiary also maintain cash balances in money market funds. Such balances are not insured. Total uninsured balances at December 31, 1999 were $8,014,558. -32- PSB HOLDINGS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 4 - SECURITIES The amortized cost and estimated fair value of investment securities are as follows: Gross Gross Estimated Amortized Unrealized Unrealized Fair COST GAINS LOSSES VALUE DECEMBER 31, 1999 Securities held to maturity: Obligations of states and political subdivisions $ 13,843,068 $ 17,904 $ 388,461 $ 13,472,511 Securities available for sale: U.S. Treasury securities and obligations of U.S. government corporations and agencies $ 47,245,814 $ 13,398 $1,517,300 $ 45,741,912 Other equity securities 747,274 747,274 Totals $ 47,993,088 $ 13,398 $1,517,300 $ 46,489,186 DECEMBER 31, 1998 Securities held to maturity: Obligations of states and political subdivisions $ 14,068,362 $ 278,490 $ 955 $ 14,345,897 Securities available for sale: U.S. Treasury securities and obligations of U.S. government corporations and agencies $ 46,920,044 $ 342,097 $ 76,687 $ 47,185,454 Other equity securities 700,678 700,678 Totals $ 47,620,722 $ 342,097 $ 76,687 $ 47,886,132
The amortized cost and estimated fair value of debt securities held to maturity and securities available for sale at December 31, 1999, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. -33-
Estimated Amortized Fair SECURITIES HELD TO MATURITY COST VALUE Due in one year or less $ 1,290,960 $ 1,297,543 Due after one year through five years 3,984,718 3,976,350 Due after five years through ten years 8,567,390 8,198,618 Totals $ 13,843,068 $13,472,511 SECURITIES AVAILABLE FOR SALE Due in one year or less $ 3,319,446 $ 3,310,390 Due after one year through five years 6,507,241 6,183,651 Due after five years through ten years 16,970,976 16,332,265 Mortgage-backed securities 20,448,151 19,915,606 Totals $ 47,245,814 $ 45,741,912
Securities with an approximate carrying value of $20,207,957 and $9,168,461 at December 31, 1999 and 1998, respectively, were pledged to secure public deposits, short-term borrowings, and for other purposes required by law. No securities were sold in 1999. Proceeds from securities sales in 1998 were $1,533,300. Gross gains of $35,867 were realized on those sales. During 1997, proceeds from security sales were $2,351,230. Gross gains and losses on those sales were $17,656 and $14,536, respectively. As a member of the Federal Home Loan Bank (FHLB) system, the Bank is required to hold stock in the FHLB based on asset size. This stock is recorded at cost which approximates fair value. Transfer of the stock is substantially restricted. Equity securities include $699,600 and $655,300 of FHLB stock at December 31, 1999 and 1998, respectively. NOTE 5 - LOANS
The composition of loans is as follows: 1999 1998 Commercial $ 51,053,737 $ 40,513,628 Real estate 118,195,029 98,259,990 Consumer 13,374,588 11,755,037 Subtotals 182,623,354 150,528,655 Allowance for loan losses (2,099,241) (1,946,864) Net loans $ 180,524,113 $148,581,791
The Company, in the ordinary course of business, grants loans to its executive officers and directors, including their families and firms in which they are principal owners. All loans to executive officers and directors are made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable -34- transactions with others and, in the opinion of management, did not involve more than the normal risk of collectibility or present other unfavorable features. Activity in such loans is summarized below:
1999 1998 Loans outstanding, January 1 $ 5,038,511 $ 7,792,986 New loans 3,411,051 6,612,687 Repayment (4,104,883) (9,367,162) Loans outstanding, December 31 $ 4,344,679 $ 5,038,511
The allowance for loan losses includes specific allowances related to commercial loans which have been judged to be impaired as defined by current accounting standards. A loan is impaired when, based on current information, it is probable that the Company will not collect all amounts due in accordance with the contractual terms of the loan agreement. These specific allowances are based on discounted cash flows of expected future payments using the loan's initial effective interest rate or the fair value of the collateral if the loan is collateral dependent. An analysis of impaired loans follows:
AT DECEMBER 31, 1999 1998 Nonaccrual $ 509,971 $ 564,414 Accruing income 1,696,412 406,000 Total impaired loans 2,206,383 970,414 Less - Allowance for loan losses 297,009 328,511 Net investment in impaired loans $ 1,909,374 $ 641,903
YEARS ENDED DECEMBER 31, 1999 1998 1997 Average recorded investment, net of allowance for loan losses $ 1,874,008 $ 819,630 $ 1,191,098 Interest income recognized $ 118,162 $ 39,569 $ 83,195
The allowance for loan losses (including impaired loans) is maintained at a level which management believes is adequate for possible loan losses. Management periodically evaluates the adequacy of the allowance using the Company's past loan loss experience, known and inherent risks in the portfolio, composition of the portfolio, current economic conditions, and other relevant factors. This evaluation is inherently subjective since it requires material estimates that may be susceptible to significant change. -35- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS An analysis of the allowance for loan losses for the three years ended December 31, follows:
1999 1998 1997 Balance, January 1 $ 1,946,864 $ 1,845,064 $ 1,924,686 Provision charged to operating expense 460,000 300,000 230,000 Recoveries on loans 124,821 9,250 40,620 Loans charged off (432,444) (207,450) (350,242) Balance, December 31 $ 2,099,241 $ 1,946,864 $ 1,845,064
NOTE 6 - PREMISES AND EQUIPMENT An analysis of premises and equipment follows:
1999 1998 Land $ 709,117 $ 627,345 Buildings and improvements 3,466,588 3,455,946 Furniture and equipment 3,196,731 2,947,739 Construction in progress 162,947 Total cost 7,535,383 7,031,030 Accumulated depreciation and amortization 3,638,160 3,145,044 Net book value $ 3,897,223 $3,885,986
Depreciation and amortization charged to operating expenses amounted to $511,047 in 1999, $493,934 in 1998, and $436,933 in 1997. NOTE 7 - DEPOSITS
At December 31, 1999, certificate and IRA accounts have scheduled maturity dates as follows: 2000 $ 75,381,840 2001 10,632,861 2002 1,583,012 2003 287,183 2004 2,050 Total $ 87,886,946
Certificate of deposit accounts with individual balances greater than $100,000 totaled $24,760,217 and $24,688,356 at December 31, 1999 and 1998, respectively. Deposits from Company directors, officers, and related parties at December 31, 1999 and 1998 totaled $5,772,331 and $7,983,980, respectively. -36- NOTE 8 - SHORT-TERM BORROWINGS
Short-term borrowings consist of the following at December 31: 1999 1998 Securities sold under repurchase agreements $ 10,737,890 $ 4,549,508 Federal funds purchased 10,477,000 Totals $ 21,214,890 $ 4,549,508
The book value of securities pledged under repurchase agreements totaled $15,378,207 and $4,801,348 at December 31, 1999 and 1998, respectively. Repurchase agreements with Company directors, officers, and related parties at December 31, 1999 and 1998 totaled $6,122,705 and $500,000, respectively. The following information relates to federal funds purchased and securities sold under repurchase agreements for the years ended December 31:
1999 1998 1997 As of end of year: Weighted average rate 5.90% 5.63% 6.14% For the year: Highest month-end balance $ 21,214,890 $ 5,220,455 $11,983,134 Daily average balance 11,660,602 3,803,415 5,555,857 Weighted average rate 5.49% 6.23% 6.18%
-37- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 9 - LONG-TERM BORROWINGS
Long-term borrowings at December 31, consist of the following: 1999 1998 Note payable to the FHLB, monthly interest payments only at 5.07%, due February, 2008, callable beginning February 2001 $ 3,000,000 $ 3,000,000 Note payable to the FHLB, monthly interest payments only at 4.97%, due August, 2009, callable beginning February 2000 3,000,000 Note payable to the FHLB, monthly interest payments only at 5.15%, due October 2009, callable beginning April 2000 4,000,000 Note payable to the FHLB, monthly interest payments only at 4.98%, due July 2009, callable beginning July 2000 3,000,000 5.70% - 5.90% FHLB advances, interest payable monthly, principal repaid during 1999 3,000,000 Totals $ 13,000,000 $ 6,000,000
The FHLB advances are secured by a blanket lien consisting principally of one-to-four family real estate loans totaling in excess of $22,000,000 and $10,000,000 at December 31, 1999 and 1998, respectively. As a member of the FHLB system, the Company may draw on a line of credit totaling $35,327,000. At December 31, 1999, the Company's available and unused portion of this line of credit totaled $22,327,000. -38- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 10 - RETIREMENT PLANS AND OTHER POSTRETIREMENT BENEFITS The Company has established a 401(k) profit-sharing contribution pension plan for its employees. The Company matches 50% of employees' salary deferrals up to the first 4% of pay deferred. The Company also may declare a discretionary profit-sharing contribution. The expense recognized for contributions to the plan for the years ended December 31, 1999, 1998, and 1997 was $173,858, $159,014, and $143,940, respectively. The Company also maintains an unfunded retirement plan for its directors. The plan pays directors who have at least 15 years of service at retirement 50% of the fees received during their final five years as a director. Currently, five directors are eligible for benefits. Details regarding the actuarial benefit obligation and related disclosures are not available. The liability recognized in the financial statements for this plan was $156,285 at December 31, 1999 and 1998. There was no provision for plan expense during 1999 or 1998. The plan expense totaled $46,000 December 31, 1997. The Company also maintains an unfunded postretirement health care benefit plan which covers the officers of the Company. After retirement, the Company will pay between 25% and 50% of the health insurance premiums for former Company officers. To qualify, an officer must have at least 15 years of service, be employed by the Company at retirement, and must be 62 years of age at retirement. The actual amount paid is based upon years of service to the Company. Effective January 1, 1997, the Company terminated its defined benefit pension plan. The Company received regulatory approval to distribute participants' vested defined benefit pension plan balances to participants or into the Company's 401(k) profit-sharing plan. During January 1998, the Company settled the defined benefit pension plan obligation by transferring existing plan assets of $1,857,740, plus an additional cash payment of $202,738 to qualified retirement plans or directly to the plan participants. -39- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The following tables provide a reconciliation of changes in the postretirement health care benefit plan and the defined benefit pension plan obligations and the fair value of assets for the years ended December 31, 1999 and 1998:
Defined Postretirement Benefit Health Care Pension BENEFIT PLAN PLAN 1999 1998 1998 Reconciliation of benefit obligations: Obligations at January 1 $ 167,930 $ 136,179 $ 1,666,759 Service cost 13,134 11,176 Interest cost 19,314 16,658 9,723 Benefit payments (6,137) (3,479) (5,820) Net amortization of prior service costs 7,396 7,396 (16,075) Loss on settlement of plan due to applicable benefit payout interest rates at time of settlement 405,891 Liquidating distributions to qualified retirement plans (2,042,103) Liquidating distributions to plan participants (18,375) Obligation at December 31 $ 201,637 $ 167,930 $ Reconciliation of fair value of plan assets: Fair value of plan assets at January 1 $ 1,855,500 Return on plan assets, net of administrative expenses 8,060 Benefit payments (5,820) Liquidating distributions to qualified Retirement plans (1,857,740) Fair value of plan assets at December 31 $
-40- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The following table provides the components of net periodic benefit cost (income) of the plans for the years ended December 31, 1999, 1998, and 1997:
Postretirement Health Care Defined Benefit BENEFIT PLAN PENSION PLAN 1999 1998 1997 1998 1997 Service cost $ 13,134 $ 11,176 $ 7,778 $ $ Interest cost 19,314 16,658 14,233 9,723 110,308 Return on plan assets (8,060) (87,256) Net amortization transition and prior service costs (income) 7,396 7,396 7,396 (16,075) (23,068) Net periodic pension cost (income) 39,844 35,230 29,407 (14,412) (16) Settlement loss 405,891 Net periodic benefit cost (income)after settlement $ 39,844 $ 35,230 $ 29,407 $ 391,479 $ (16)
The assumptions used in the measurement of the Company's benefit obligations are shown in the following table:
Postretirement Health Care Defined Benefit BENEFIT PLAN PENSION PLAN 1999 1998 1997 1998 1997 Discount rate 7.50% 7.50% 7.50% N/A 7.00% Expected return on plan assets N/A N/A N/A N/A 5.79% Health care cost trend rate 7.50% 7.25% 7.50% N/A N/A Rate of compensation increases N/A N/A N/A N/A 0.00%
The health care cost trend rate is anticipated to be 7.50% in 2000, grading down 0.25% per year to 5.0%. Assumed health care cost trend rates have a significant effect on the amounts reported for the health care benefit plan. A 1% increase in assumed health care cost trend rates would have the following effects:
1999 1998 1997 Effect on service and interest cost $ 8,011 $ 5,681 $ 847 Effect on accumulated benefit obligation at December 31 59,971 43,082 8,362
-41- NOTE 11 -SELF-FUNDED HEALTH INSURANCE PLAN The Company has established an employee medical benefit plan to self-insure claims up to $10,000 per year for each individual with a $281,097 stop-loss per year for participants in the aggregate. The Company and its covered employees contribute to the fund to pay the claims and stop-loss premiums. Medical benefit plan costs are expensed as incurred. As of December 31, 1999, management believes adequate provision to expense has been made for claims incurred but not yet reported that are not covered by the stop-loss. Health insurance expense recorded in 1999, 1998, and 1997 was $168,564, $143,969, and $126,237, respectively. NOTE 12 - INCOME TAXES The components of the income tax provision are as follows:
1999 1998 1997 Current income tax provision: Federal $ 1,016,000 $ 991,400 $ 965,900 State 121,500 106,500 114,000 Total current 1,137,500 1,097,900 1,079,900 Deferred income tax benefit: Federal (60,000) (142,400) (85,900) State (10,000) (27,500) (23,000) Total deferred (70,000) (169,900) (108,900) Total provision for income taxes $ 1,067,500 $ 928,000 $ 971,000
-42- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Deferred income taxes are provided for the temporary differences between the financial reporting basis and the tax basis of the Company's assets and liabilities. The major components of the net deferred tax assets are as follows:
1999 1998 Deferred tax assets: Allowance for loan losses $ 708,800 $ 653,800 Deferred compensation 68,800 69,300 State net operating loss 13,000 9,500 Post-retirement health care benefits 73,500 64,300 Employee pension plan 41,000 42,800 Unrealized loss on securities available for sale 560,774 Other 2,600 Less - Valuation allowance (113,000) (9,500) Gross deferred tax assets 1,352,874 832,800 Deferred tax liabilities: Unrealized gain on securities available for sale 92,992 Premises and equipment 138,500 155,000 Employee pension plan 5,800 Gross deferred tax liabilities 144,300 247,992 Net deferred tax assets $ 1,208,574 $ 584,808
The Company, and its subsidiary, pay state income taxes on individual, unconsolidated net earnings. At December 31, 1999, tax net operating loss carryforwards at the parent company of approximately $250,000 existed to offset future state taxable income. These net operating losses will begin to expire in 2012. A valuation allowance has been recognized to adjust deferred tax assets to the amount of tax ne t operating losses expected to be utilized to offset future income. A valuation allowance of $100,000 has also been recognized to offset deferred tax assets related to unrealized capital losses of approximately $295,000. If realized, the tax benefit for these items will reduce current tax expense for the period in which they are realized. -43- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS A summary of the source of differences between income taxes at the federal statutory rate and the provision for income taxes for the years ended December 31, follows:
1999 1998 1997 Percent of Percent of Percent of Pretax Pretax Pretax AMOUNT INCOME AMOUNT INCOME AMOUNT INCOME Tax expense at statutory rate $ 1,243,000 34.0% $ 1,026,000 34.0% $ 1,045,000 34.0% Increase (decrease) in taxes resulting from: Tax-exempt interest (221,900) (6.1) (194,000) (6.4) (174,500) (5.7) State income tax 73,600 2.0 52,000 1.7 60,000 2.0 Other (27,200) (0.7) 44,000 1.5 40,500 1.3 Provision for income taxes $ 1,067,500 29.2% $ 928,000 30.8% $ 971,000 31.6%
NOTE 13 - LEASES The Company leases various pieces of equipment under cancelable leases and space for a branch location under a noncancelable lease. All leases are classified as operating. Future minimum payments under the noncancelable lease are as follows:
2000 $25,540 2001 26,389 2002 27,252 2003 2,277 Total $81,458
Rental expense for all operating leases was $39,104, $32,462, and $12,735 for the years ended December 31, 1999, 1998, and 1997, respectively. NOTE 14 - FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK CREDIT RISK The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the balance sheets. -44- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The Company's exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. These commitments at December 31 are as follows:
1999 1998 Commitments to extend credit: Fixed rate $ 10,525,503 $ 7,473,927 Variable rate 15,915,386 11,301,151 Letters of credit - variable rate 845,952 1,470,887 Credit card commitments - fixed rate 2,667,512 2,278,144 Totals $ 29,954,353 $ 22,524,109
Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer's creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary upon extension of credit, is based on management's credit evaluation of the party. Collateral held varies but may include accounts receivable, inventory, property, plant, and equipment, and income-producing commercial properties. Letters of credit are conditional commitments issued to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to support public and private borrowing arrangements. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. Collateral held varies as specified above and is required in instances which the Company deems necessary. The commitments are structured to allow for 100% collateralization on all letters of credit. Credit card commitments are commitments on credit cards issued by the Company and serviced by Elan Financial Services. These commitments are unsecured. CONCENTRATION OF CREDIT RISK The Company grants residential mortgage, commercial and consumer loans predominantly in the greater Wausau area, Marathon County, and Rhinelander, Wisconsin in Oneida County. There are no significant concentrations of credit to any one debtor or industry group. It is felt that the diversity of the local economy will prevent significant losses in the event of an economic downturn. -45- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS CONTINGENCIES In the normal course of business, the Company is involved in various legal proceedings. In the opinion of management, any liability resulting from such proceedings would not have a material adverse effect on the consolidated financial statements. Under the most recent provisions approved by the Company's Board of Directors, up to 45,000 shares may be repurchased from shareholders from time to time at the prevailing market price. Prior to the issuance of the 1999 financial statements, various shareholders holding approximately 4,100 shares elected to have the Company repurchase their shares in transactions to be completed during 2000. INTEREST RATE RISK The Company originates and holds adjustable rate mortgage loans with variable rates of interest. The rate of interest on these loans is capped over the life of the loan. At December 31, 1999, none of the approximately $9,113,000 of variable rate loans had reached the interest rate cap. NOTE 15 - CAPITAL REQUIREMENTS The Company and the Bank are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory-and possibly additional discretionary-actions by regulators that, if undertaken, could have a direct material effect on the Company's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the bank must meet specific capital guidelines that involve quantitative measures of the bank's assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The Bank's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the table below) of total and Tier I capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier I capital (as defined) to average assets (as defined). Management believes, as of December 31, 1999, that the Bank meets all capital adequacy requirements to which it is subject. As of December 31, 1999, the most recent notification from the Federal Deposit Insurance Corporation categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the Bank must maintain minimum total risk-based, Tier I risk-based, and Tier I leverage ratios as set forth in the table. There are no conditions or events since that notification that management believes have changed the Bank's category. -46- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The Company's and the Bank's actual capital amounts and ratios are also presented in the table.
To Be Well Capitalized Under For Capital Prompt Corrective ACTUAL ADEQUACY PURPOSES ACTION PROVISIONS AMOUNT RATIO AMOUNT RATIO AMOUNT RATIO As of December 31, 1999: Total capital (to risk weighted assets): Consolidated $ 24,189,000 13.4% $ 14,402,000 8.0% N/A Subsidiary bank $ 23,965,000 13.3% $ 14,401,000 8.0% $ 18,001,000 10.0% Tier I capital (to risk weighted assets): Consolidated $ 22,090,000 12.3% $ 7,201,000 4.0% N/A Subsidiary bank $ 21,866,000 12.1% $ 7,200,000 4.0% $ 10,800,000 6.0% Tier I capital (to average assets): Consolidated $ 22,090,000 8.7% $ 10,128,000 4.0% N/A Subsidiary bank $ 21,866,000 8.6% $ 10,128,000 4.0% $ 12,660,000 5.0% As of December 31, 1998: Total capital (to risk weighted assets): Consolidated $ 22,304,000 14.5% $ 12,303,000 8.0% N/A Subsidiary bank $ 22,059,000 14.4% $ 12,284,000 8.0% $ 15,355,000 10.0% Tier I capital (to risk weighted assets): Consolidated $ 20,384,000 13.3% $ 6,152,000 4.0% N/A Subsidiary bank $ 20,139,000 13.1% $ 6,142,000 4.0% $ 9,213,000 6.0% Tier I capital (to average assets): Consolidated $ 20,384,000 8.9% $ 9,126,000 4.0% N/A Subsidiary bank $ 20,139,000 8.8% $ 9,117,000 4.0% $ 11,396,000 5.0%
-47- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 16 - RESTRICTIONS ON RETAINED EARNINGS The Bank is restricted by banking regulations from making dividend distributions above prescribed amounts and is limited in making loans and advances to the Company. At December 31, 1999, the retained earnings of the subsidiary available for distribution as dividends without regulatory approval was approximately $8,301,000. NOTE 17 - FAIR VALUE OF FINANCIAL INSTRUMENTS SFAS No. 107, "Disclosures About Fair Value of Financial Instruments" requires that the Company disclose estimated fair values for its financial instruments. The fair value estimates, methods, and assumptions regarding the Company's financial instruments are shown below. The following methods and assumptions were used by the Company in estimating its fair value disclosures for financial statements: Cash and Short-term Investments: The carrying amounts reported in the balance sheets for cash and due from banks, interest-bearing deposits and money market funds, and federal funds sold approximate the fair value of these assets. Securities: Fair values for investment securities are based on quoted market prices. Loans: For variable rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values. The fair value for other loans is estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. In addition, for impaired loans, marketability and appraisal values were considered in the fair value determination. The carrying amount of accrued interest approximates its fair value. Deposit Liabilities: The fair value of deposits with no stated maturity, such as demand deposits, NOW accounts, savings and money market accounts, is equal to the amount payable on demand at the reporting date. Fair value for fixed rate certificates of deposit is estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected maturities on time deposits. Short-Term Borrowings: The fair value of short-term borrowings with no stated maturity, such as federal funds purchased, is equal to the amount payable on demand at the reporting date. Fair value for fixed rate repurchase agreements is estimated using a discounted cash flow calculation that applies interest rates currently being offered on repurchase agreements to a schedule of aggregated expected maturities on the existing agreements. Long-Term Borrowings: The fair value of the Company's long-term borrowings (other than deposits) is estimated using discounted cash flow analyses based on the Company's current incremental borrowing rates for similar types of borrowing arrangements. Off-Balance-Sheet Instruments: The fair value of commitments would be estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements, the current interest rates, and the present credit worthiness of the counter parties. Since this amount is immaterial, no amounts for fair value are presented. The carrying amounts and fair values of the Company's financial instruments consisted of the following at December 31: -48-
1999 1998 Carrying Estimated Carrying Estimated AMOUNT FAIR VALUE AMOUNT FAIR VALUE Financial assets: Cash and short-term investments $ 11,987,763 $ 11,987,763 $ 13,426,756 $ 13,426,756 Securities 60,332,254 59,961,697 61,954,494 62,232,029 Net loans 180,524,112 180,032,781 151,702,241 152,613,525 Financial liabilities: Deposits 202,354,241 202,400,590 199,799,897 200,190,127 Short-term borrowings 21,214,890 21,200,651 4,549,508 4,549,508 Long-term borrowings 13,000,000 12,907,246 6,000,000 6,008,439
LIMITATIONS Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company's entire holdings of a particular financial instrument. Because no market exists for a significant portion of the Company's financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgement and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates are based on existing on- and off-balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. Significant assets, and liabilities that are not considered financial assets or liabilities include premises and equipment, other assets, and other liabilities. In addition, the tax ramifications related to the realization of the unrealized gains or losses can have a significant effect on fair value estimates and have not been considered in the estimates. -49- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 18 - SUBSEQUENT EVENTS Subsequent to December 31, 1999, the Company acquired an option to purchase real estate in the amount of $450,000 in Rhinelander, Wisconsin to be used as a branch bank location. Subsequent to December 31, 1999, the Company approved formation of an employee stock ownership plan (ESOP) subject to a feasibility study of its benefits. The Company anticipates ESOP shares will be purchased on the open market from existing shareholders at the prevailing market price to be funded with a portion of the Company's profit-sharing contributions. NOTE 19 - CONDENSED PARENT COMPANY ONLY FINANCIAL STATEMENTS The following condensed balance sheets as of December 31, 1999 and 1998, and condensed statements of income and cash flows for the years ended December 31, 1999, 1998, and 1997 for PSB Holdings, Inc. should be read in conjunction with the consolidated financial statements and footnotes.
BALANCE SHEETS December 31, 1999 and 1998 ASSETS 1999 1998 Cash and due from banks $ 752,995 $ 725,715 Investment in subsidiary 20,823,276 20,311,399 Other assets 35,573 47,482 Total assets $ 21,611,844 $ 21,084,596 LIABILITIES AND STOCKHOLDERS' EQUITY Accrued dividends payable $ 565,427 $ 528,381 Total stockholders' equity 21,046,417 20,556,215 Total liabilities and stockholders' equity $ 21,611,844 $ 21,084,596
-50- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
STATEMENTS OF INCOME Years Ended December 31, 1999, 1998, and 1997 1999 1998 1997 Income: Dividends from subsidiary $ 909,000 $ 967,000 $ 1,311,000 Interest 8,148 2,383 2,893 Total income 917,148 969,383 1,313,893 Expenses: Interest 6,782 Other 77,589 54,418 58,360 Total expenses 77,589 54,418 65,142 Income before income taxes and equity in undistributed net income of subsidiary 839,559 914,965 1,248,751 Income tax benefit 22,000 17,000 20,000 Net income before equity in undistributed net income of subsidiary 861,559 931,965 1,268,751 Equity in undistributed net income of subsidiary 1,727,423 1,156,612 833,958 Net income $ 2,588,982 $ 2,088,577 $ 2,102,709
-51- PSB HOLDINGS, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
STATEMENTS OF CASH FLOWS Years Ended December 31, 1999, 1998, and 1997 1999 1998 1997 Cash flows from operating activities: Net income $ 2,588,982 $ 2,088,577 $ 2,102,709 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Equity in net income of subsidiary (2,636,423) (2,123,612) (2,144,958) Net amortization 21,517 21,517 21,517 (Increase) decrease in other assets (9,607) 28,002 (20,003) Increase in other liabilities 37,046 30,157 19,393 Net cash provided by (used in) operating activities 1,515 44,641 (21,342) Cash flows from investing activities - Dividends received from subsidiary 909,000 967,000 1,311,000 Cash flows from financing activities: Dividends paid (883,235) (821,411) (795,944) Purchase of treasury stock (487,600) Net cash used in financing activities (883,235) (821,411) (1,283,544) Net increase in cash and due from banks 27,280 190,230 6,114 Cash and due from banks at beginning 725,715 535,485 529,371 Cash and due from banks at end $ 752,995 $ 725,715 $ 535,485
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE. None. -52- PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT. Information relating to directors of the Company is incorporated into this Form 10-K by this reference to the material set forth in the table under the caption "Election of Directors", pages 2 through 4, of the Company's proxy statement dated March 31, 2000 (the "2000 Proxy Statement"). Information relating to executive officers is found in Part I of this Form 10-K, page 6. Information required under Rule 405 of Regulation S-K is incorporated into this Form 10-K by this reference to the material set forth under the caption "Section 16(a) Beneficial Ownership Reporting Compliance" on page 6 of the 2000 Proxy Statement. ITEM 11. EXECUTIVE COMPENSATION. Information relating to director compensation is incorporated into this Form 10-K by this reference to the 2000 Proxy Statement under the subcaption "Compensation of Directors", page 5. Information relating to the compensation of executive officers is incorporated into this Form 10-K by this reference to (1) the material set forth under the subcaption "Summary Compensation Table," page 8, and (2) the material set forth under the subcaption "Compensation Committee and Board Interlocks and Insider Participation," page 8 in the 2000 Proxy Statement. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT. Information relating to security ownership of certain beneficial owners and management is incorporated into this Form 10-K by this reference to the material set forth under the caption "Beneficial Ownership of Common Stock," pages 5 and 6, in the 2000 Proxy Statement. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. Information relating to transactions with management is incorporated into this Form 10-K by this reference to the material set forth under the caption "Certain Relationships and Related Transactions," page 9, in the 2000 Proxy Statement. -53- PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K. (a) Documents filed as part of this report. (1) The financial statements filed as part of this report are set forth on pages 24-52 herein. (2) No financial statement schedules are required by Item 14(d). (3) Exhibits. The following exhibits required by Item 601 of Regulation S-K are filed with the Securities and Exchange Commission as part of this report. Exhibit NUMBER DESCRIPTION 3.1 Restated Articles of Incorporation, as amended (incorporated by reference to Exhibit 4(a) to the Company's Current Report on Form 8-K dated May 30, 1995) 3.2 Bylaws (incorporated by reference to Exhibit 4(b) to the Company's Current Report on Form 8-K dated May 30, 1995) 4.1 Articles of Incorporation and Bylaws (see Exhibits 3.1 and 3.2) 10.1 Bonus Plan of Directors of the Bank (incorporated by reference to Exhibit 10(a) to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995)* 10.2 Bonus Plan of Officers and Employees of the Bank* (incorporated by reference to Exhibit 10(b) to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995)* 10.3 Non-Qualified Retirement Plan for Directors of the Bank (incorporated by reference to Exhibit 10(c) to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995)* 21.1 Subsidiaries of the Company (incorporated by reference to Exhibit 22 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995) -54- 27.1 Financial Data Schedule (filed electronically only) *Denotes Executive Compensation Plans and Arrangements. (b) Reports on Form 8-K. None. -55- SIGNATURES Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. PSB Holdings, Inc. By DAVID K. KOPPERUD March 30, 2000 David K. Kopperued, President Pursuant to the requirement of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on this 30th day of March, 2000. SIGNATURE AND TITLE SIGNATURE AND TITLE DAVID K. KOPPERUD TODD R. TOPPEN David K. Kopperud, President Todd R. Toppen, Treasurer Chief Executive Officer (Chief Financial and Principal Accounting Officer) DIRECTORS: LEONARD C. BRITTEN GORDON P. CONNOR Leonard C. Britten Gordon P. Connor PATRICK L. CROOKS WILLIAM J. FISH Patrick L. Crooks William J. Fish CHARLES A. GHIDORZI GEORGE L. GEISLER Charles A. Ghidorzi George L. Geisler GORDON P. GULLICKSON LAWRENCE HANZ, JR. Gordon P. Gullickson Lawrence Hanz, Jr. THOMAS R. POLZER THOMAS A. RIISER Thomas A. Polzer Thomas A. Riiser WILLIAM M. REIF EUGENE WITTER William M. Reif Eugene Witter -56- EXHIBIT INDEX TO FORM 10-K OF PSB HOLDINGS, INC. FOR THE PERIOD ENDED DECEMBER 31, 1999 Pursuant to Section 102(d) of Regulation S-T (17 C.F.R.
232.102(d)) EXHIBIT 27.1 - FINANCIAL DATA SCHEDULE Exhibits required by Item 601 of Regulation S-K which have been previously filed and are incorporated by reference are set forth in Part IV, Item 14(c) of the Form 10-K to which this Exhibit Index relates. EX-27.1 2 ART. 9 FDS FOR 12-MONTHS 10-K
9 1,000 YEAR DEC-31-1999 DEC-31-1999 11,926 62 0 0 46,489 13,843 13,473 182,623 2,099 259,889 202,354 21,215 2,273 13,000 0 0 1,805 19,241 259,889 14,065 3,472 135 17,671 7,585 8,598 9,073 460 0 6,221 3,656 3,656 0 0 2,589 2.93 2.93 4.22 620 0 0 427 1,947 432 124 2,099 2,099 0 0
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