-----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, NA81g1o538KjRipftlC3syiQ+2u6C9jFtJk8CzK5CzGN4DBNTp9re3kibksQ+0bF uzDtPjTxbd/F70OSWshVYw== 0000914317-99-000281.txt : 19990512 0000914317-99-000281.hdr.sgml : 19990512 ACCESSION NUMBER: 0000914317-99-000281 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990331 FILED AS OF DATE: 19990511 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SUSSEX BANCORP CENTRAL INDEX KEY: 0001028954 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 223475473 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 001-12569 FILM NUMBER: 99617254 BUSINESS ADDRESS: STREET 1: 399 RTE 23 STREET 2: 9 CITY: FRANKLIN STATE: NJ ZIP: 07416 BUSINESS PHONE: 9738272914 MAIL ADDRESS: STREET 1: 399 RTE 23 CITY: FRANKLIN STATE: NJ ZIP: 07416 10QSB 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 ------------------- FORM 10-QSB (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1999 or [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________________ to _____________________ Commission file number 0-29030 SUSSEX BANCORP (Exact name of registrant as specified in its charter) NEW JERSEY 22-3475473 ---------- ---------- (State of other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) Issuer's telephone number, including area code: (973) 827-2914 - -------------------------------------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes _X_ No___ As of April 30, 1999 there were 1,424,634 shares of common stock, no par value, outstanding. SUSSEX BANCORP FORM 10-QSB INDEX Page(s) PART I - FINANCIAL INFORMATION Item 1. Financial Statements and Notes to Consolidated Financial Statements 1 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 PART II - OTHER INFORMATION Item 1. Legal Proceedings 15 Item 2. Changes in Securities 15 Item 3. Defaults Upon Senior Securities 15 Item 4. Submission of Matters to a Vote of Security holders 15 Item 5. Other Information 15 Item 6. Exhibits and Reports on Form 8-K 15 Signatures 16 ii PART I - FINANCIAL INFORMATION ITEM 1 - FINANCIAL STATEMENTS SUSSEX BANCORP CONSOLIDATED BALANCE SHEETS (in Thousands, Except Share Data) (Unaudited)
Assets March 31, 1999 December 31, 1998 - ------- --------------- ----------------- Cash and Due from Banks $ 4,976 $ 4,060 Interest bearing deposits in other banks 150 150 Federal Funds Sold 14,875 26,450 Securities: Available for Sale, at Market Value 34,781 26,645 Held to maturity 9,411 5,939 --------- --------- Total Securities 44,192 32,584 Loans held for sale 115 354 Loans (Net of Unearned Income) 71,098 70,011 Less: Allowance for Possible Loan Losses 691 665 --------- --------- Net Loans 70,522 69,700 Premises and Equipment, Net 2,929 2,956 Other Real Estate 43 36 Intangible Assets, Primarily Core Deposit Premiums 682 703 Other Assets 1,348 828 --------- --------- Total Assets $ 139,717 $ 137,467 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities: Deposits: Demand 19,246 19,793 Savings 58,200 54,357 Time 52,397 53,564 --------- --------- Total Deposits 129,843 127,714 Other Liabilities 586 509 --------- --------- Total Liabilities 133,429 128,223
(continued)
Assets March 31, 1999 December 31, 1998 - ------- --------------- ----------------- Stockholders' Equity: Common Stock, No Par Value Authorized 5,000,000 Shares, Issued and outstanding 1,424,634 in 1999 and 1,422,260 in 1998, respectively 5,659 5,635 Retained Earnings 3,697 3,547 Treasury Stock (6) (2) Net Unrealized Gain (Loss) on Securities Available for Sale, net of income taxes (62) 64 --------- --------- Total Stockholders' Equity 9,288 9,244 Total Liabilities and Stockholders' Equity $ 139,717 $ 137,467 ========= =========
See Notes to Consolidated Financial Statements 2 SUSSEX BANCORP CONSOLIDATED STATEMENTS OF INCOME (In Thousands, Except Share Data) (Unaudited)
Three Months Ended March 31, ------------------------ 1999 1998 ---------- ---------- INTEREST INCOME Interest and Fees on Loans $ 1,406 $ 1,384 Interest on Time Deposits 2 1 Interest on Securities: Taxable 439 403 Exempt from Federal Income Tax 85 19 Interest on Federal Funds Sold 199 144 ---------- ---------- Total Interest Income 2,131 1,951 INTEREST EXPENSE Interest on Deposits: Interest on Savings Deposits 378 266 Interest on Time Deposits 669 565 ---------- ---------- Total Interest Expense 1,047 831 Net Interest Income 1,084 1,120 Provision for Possible Loan Losses 33 21 ---------- ---------- Net Interest Income After Provision for Possible Loan Losses 1,051 1,099 NON-INTEREST INCOME Trust Income 1 -0- Service charges on Deposit Accounts 137 124 Other Income 158 59 ---------- ---------- Total Non-interest Income 296 183
(continued)
Three Months Ended March 31, ------------------------ 1999 1998 ---------- ---------- NON-INTEREST EXPENSE Salaries and Employee Benefits 573 511 Occupancy Expense, Net 94 92 Furniture and Equipment Expense 120 95 Data Processing Expense 20 18 Amortization of Intangibles 21 21 Other Expenses 279 262 ---------- ---------- Total Non-Interest Expense 1,107 999 Income Before Provision for Income Taxes 240 283 Provision for Income Taxes 48 101 ---------- ---------- Net Income $ 192 $ 182 ========== ========== Net Income Per Common Share $ 0.13 $ 0.13 ========== ========== Weighted Average Shares Outstanding 1,423,228 1,398,866
See Notes to Consolidated Financial Statements 3 SUSSEX BANCORP CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (In Thousands) (Unaudited)
Three Months Ended March 31, 1999 1998 Net Income ......................................... $ 192 $ 182 Other Comprehensive Income, Net of tax Unrealized loss on available-for- sale Securities .............................. (62) 64 ---- -- Comprehensive income $ 130 $ 246
See Notes to Consolidated Financial Statements 4 SUSSEX BANCORP CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (In Thousands, Except Share Data) (Unaudited)
Unrealized Gain (Loss) on Total Common Retained Treasury Securities Stockholders Stock Earnings Stock Available for Sale Equity ----- -------- ----- ------------------ ------ Balance December 31, 1998 $5,635 $3,547 $ (2) $ 64 $9,244 Net Income for the Period 192 192 Shares issued through dividend reinvestment plan 14 14 Stock Option Exercised 10 10 Treasury Stock purchased (4) (4) Cash Dividends (42) (42) Change in unrealized loss on securities available for sale (126) (126) Balance March 31, 1999 $5,659 $3,697 $ (6) $ (62) $9,288
See Notes to Consolidated Financial Statements 5 CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Three Months Ended March 1999 1998 ---- ---- Cash Flows from Operating Activities: Net Income $ 192 $ 182 Adjustments to reconcile net income to net cash provided by Operating Activities: Depreciation and Amortization of Premises and Equipment 98 80 Amortization of Intangible Assets 21 21 Premium amortization (discount accretion) of securities, net 39 14 Provision for Possible Loan Loses 26 21 (Gain) on Sale of Securities, Available for Sale (3) -- Accretion of Loan origination and commitment fees, net 8 12 Decrease (Increase) Loans Held for Sale 239 -- Deferred Federal income tax benefit (increase) (25) 49 Decrease (Increase) in Accrued Interest Receivable (299) (100) Decrease (Increase) in Other Assets (112) (70) (Decrease) Increase in Accrued Interest and Other Liabilities 77 (149) -------- -------- Net Cash Provided by Operating Activities $ 177 $ 60 Cash Flow from Investing Activities: Securities Available for Sale: Proceeds from Maturities and Pay-downs 1,522 857 Proceeds from Sales/Calls Prior to Maturity 507 5,000 Purchases (10,406) (2,390) Securities Held to maturity: Proceeds from Maturities -- 295 Purchases (3,478) (70)
6
Three Months Ended March 1999 1998 ---- ---- Net Increase in Loans Outstanding (1,095) (597) Capital Expenditures (71) (130) Net Increase in Other Real Estate (7) -- -------- -------- Net Cash Provided by (used in) Investing Activities $(13,027) $ 2,965 Cash Flows from Financing Activities: Net (Decrease) Increase Total Deposits 2,129 7,881 Exercise of stock options 10 -- Payment of dividends net of reinvestment (28) -- Purchase of Treasury Stock (4) -- -------- -------- Net Cash (used in) Provided by Financing Activities $ 2,107 $ 7,881 Net Increase (Decrease) in Cash and Cash Equivalents (10,659) 10,906 Cash and Cash Equivalents, Beginning of Period 30,660 13,568 Cash and Cash Equivalents, End of Period $ 20,001 $ 24,474 ======== ========
See Notes to Consolidated Financial Statements 7 SUSSEX BANCORP AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. Basis of Presentation Sussex Bancorp ("the Company"), a one-bank holding company was incorporated in January, 1996 to serve as a holding company for the Sussex County State Bank ("the Bank"). The Bank is the only active subsidiary of the Company at March 31, 1999. The Bank operates seven banking offices, all located in Sussex County. The company is subject to the supervision and regulation of the Board of Governors of the Federal Reserve System (the "FRB"). The Bank's deposits are insured by the Bank Insurance Fund ("BIF") of the Federal Deposit Insurance corporation ("FDIC") up to applicable limits. The operations of the Company and the Bank are subject to the supervision and regulation of the FRB, FDIC and the New Jersey Department of Banking and Insurance (the "Department"). The consolidated financial statements included herein have been prepared without audit in accordance with the rules and regulations of the Securities and Exchange Commission and reflect all adjustments which, in the opinion of management, are necessary for a fair statement of the results for interim periods. All adjustments made were of a normal recurring nature. These consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto that are included in the Company's Annual Report on Form 10-KSB for the fiscal period ended December 31, 1998. 2. Cash and Cash Equivalents For purposes of reporting cash flows, cash and cash equivalents include cash and due from banks and federal funds sold. Generally, federal funds are sold for a one day period. 3. Securities The amortized cost and approximate market value of securities are summarized as follows (in thousands):
March 31, 1999 December 31, 1998 -------------- ---------------- Amortized Market Amortized Market Cost Value Cost Value ------- ------- ------- ------- Securities Available For Sale - U. S. Treasury Securities $ 5,584 $ 5,591 $ 5,589 $ 5,710 U. S. Government Backed Securities 27,758 27,672 19,407 19,411 Equity Securities 1,543 1,518 1,543 1,524 ------- ------- ------- ------- Total $34,885 $34,781 $26,539 $26,645 Securities Held to Maturity - Obligations of State and Political Subdivisions 9,411 9,373 5,939 5,949 ------- ------- ------- ------- Total 9,411 9,373 5,939 5,949 Total Securities $44,296 $44,154 $32,478 $32,594 ======= ======= ======= =======
8 ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Three Months Ended March 31, 1999 and March 31, 1998 OVERVIEW The Company realized net income of $192 thousand for the first quarter of 1999, a increase of $10 thousand, or 5.5%, from the $182 thousand reported for the same period in 1998. Earnings per share were $.13 for each of the respective periods. The increase in net income for the three months ended March 31, 1999 over the comparable period primarily reflects an increase in non-interest income and a decrease in provision for income taxes, partially offset by a $48 thousand decline in net interest income after provision for possible loan losses and an increase in non-interest expense. Interest Income. Total interest income increased $180 thousand, or 9.2%, to $2.1 million for the three months ended March 31, 1999 from $2.0 million for the three months ended March 31, 1998. This growth in interest income is the result of a $20.8 million increase in earning assets over the comparable period of last year, partially offset by a decrease in the average yield on total earning assets to 6.66% during the quarter from 7.28% during the quarter ended March 31, 1998. The decline in average yield reflects reinvestment of mortgage principal repayments and amortization and proceeds of securities calls and maturities into a lower interest rate environment. Funds are currently being reinvested at a lower rate than were previously earned, reflecting both lower market rates of interest as well as the Company's decision to offer lower rate products in its efforts to retain its market share in a competitive environment. Interest Expense. Interest expense on deposits increased $216 thousand, or 26.0%, during the current quarter compared to the same quarter a year ago. The average balance of interest bearing deposits increased $19.9 million, or 22.6%, for the current quarter over the prior year. This growth is primarily the result of marketing a higher yielding savings account to senior citizens. The average cost of the interest-bearing deposits increased to 3.89% during the current quarter, from 3.78% during the same quarter in the prior year, reflecting both the success of the Company's senior savings account and a $10.1 million increase in higher costing time deposits. Table 1 following presents a summary of the Company's interest-earning assets and their average yields, and interest-bearing liabilities and their average costs and shareholders' equity for the three months ended March 31, 1999 and 1998. The average balance of loans includes non-accrual loans, and associated yields include loan fees which are considered adjustment to yields. 9 Comparative Average Balance Sheets Three Months Ended March 31,
1999 1998 Interest Average Average Rates Rates Average Income/ Earned/ Average Income Earned/ Balance Expense Paid Balance Expense Paid ------- ------- ---- ------- ------- ---- (Dollars in Thousands) Assets Interest Earning assets: Taxable loans (net of unearned income)................................. $ 70,811 $ 1,406 7.94% $ 68,549 $ 1,384 8.08% Tax exempt securities .................. 8,766 85 3.88% 1,906 19 4.21% Taxable investment securities .......... 31,628 439 5.55% 26,462 404 6.11% Interest bearing deposits .............. 150 2 5.33% 86 1 4.65% Federal Funds sold ..................... 16,722 199 4.76% 10,305 144 5.59% Total earning assets ................... 128,077 2,131 6.66% 107,308 1,952 7.28% Non-interest earning assets ............ 9,181 8,133 Allowance for possible loan losses .......................... (694) (697) Total Assets .....................$ 136,564 $ 114,744
10 COMPARATIVE AVERAGE BALANCE SHEETS Three Months Ended March 31,
1999 1998 Average Average Interest Rates Rates Average Income/ Earned/ Average Income/ Earned/ Balance Expense Paid Balance Expense Paid Liabilities and Shareholders' Equity Interest bearing liabilities: NOW deposits $ 14,418 $ 57 1.58% $ 12,951 $ 61 1.88% Savings deposits 37,351 294 3.15% 26,680 179 2.50% Money market deposits 3,938 26 2.64% 4,347 26 2.39% Time deposits 52,089 670 5.15% 41,953 566 5.40% Total interest bearing 107,796 1,047 3.89% 87,931 832 3.78% liabilities Non-interest bearing liabilities: Demand Deposits $ 18,566 $ 17,517 Other Liabilities 948 915 Total Non-Interest Bearing Liabilities 19,514 18,432 Shareholders' equity 9,254 8,381 Total Liabilities and Shareholders' Equity $136,564 $114,744 New Interest Differential $ 1,084 $ 1,120 Net Yield on Interest-Earning Assets 3.80% 4.22%
Other Income. Other income increased by $113 thousand, or 61.7%, to $296 thousand for the first quarter of 1999 from $183 thousand for the first quarter of 1998. The increase primarily reflects increased revenues from the sale of non-deposit products and earnings from the Bank's newly formed mortgage company subsidiary. Provision for Loan Losses. The provision for loan losses for the three months ended March 31, 1999 was $33 thousand, compared to $21 thousand for the same period last year. Income Taxes. The provision for income taxes, both state and federal, decreased $53 thousand to $48 thousand for the first quarter of 1999 compared to $101 thousand for the same period in 1998. The decrease in income taxes resulted from an increase in tax exempt securities in 1999. 11 FINANCIAL CONDITION March 31, 1999 as compared to December 31, 1998 Total assets increased $2.3 million, or 1.6%, to $139.7 million at March 31, 1999 from $137.5 million at December 31, 1998. This total increase reflects increases of $916 thousand in cash and due from banks, $11.6 million in total securities, $1.1 million in total loans, and $479 thousand in all other assets, which consists of premises and equipment, other real estate, intangible assets, and other assets. These increases were offset by a decrease of $11.6 million in federal funds sold, including a decline of $3.0 million in term federal funds sold and $8.6 million in federal funds sold. Total loans at March 31, 1999 increased $1.1 million, or 1.6%, over year end to $71.1 million. Although the components of the Company's portfolio remained relatively stable from year end, residential loans represented 66.7% of the portfolio, a decline from the 70.3% of the portfolio at year end, loans secured by non-residential properties increased to 18.1% of the portfolio, up from 16.6% at year end, and construction loans increased to 5.1% of the portfolio compared to 3.4% at year end. The following schedule presents the components of loans, net of unearned income, by type, for each period presented.
March 31 December 31 1999 1998 Amount Percent Amount Percent ------ ------- ------ ------- (Dollars in Thousands) Commercial and industrial .. $ 4,148 5.83% $ 3,742 5.34% Real Estate: Non-residential properties ............ 12,852 18.08% 11,612 16.59% Residential properties 47,465 66.76% 49,198 70.27% Construction .............. 3,613 5.08% 2,352 3.36% Lease financing ............ 134 0.19% 142 .20% Consumer/ Other Loans ...... 2,886 4.06% 2,965 4.23% ------- ------ ------- ------ Total Loans ................ $71,098 100.00% $70,011 100.00% ======= ====== ======= ======
Total average deposits increased $11.3 million, or 9.8%. Time deposits increased by $4.7 million, savings deposits increased by $6.7 million and NOW deposits increased by $922 thousand. Management continues to monitor the shift in deposits through its Asset/Liability committee. The following schedule presents the components of deposits, for each period presented.
March 31, 1999 December 31, 1998 Average Average Amount % Amount % -------- ------ -------- ------ NOW deposits.................................... $14,418 11.41% $13,496 11.73% Savings deposits.............................. 37,351 29.56% 30,646 26.64% Money market deposits......................... 3,938 3.12% 4,590 3.99% Time deposits................................. 52,089 41.22% 47,398 41.20% Demand deposits............................... 18,566 14.69% 18,912 16.44% -------- ------ -------- ------ Total interest-bearing liabilities $126,362 100.00% $115,042 100.00% ======== ====== ======== ======
12 ASSET QUALITY At March 31, 1999, non-performing loans decreased $78 thousand, as compared to December 31, 1998. The decrease was attributable to several real estate loans being restored to performing status. Management continues to monitor the Company's asset quality. The following table provides an analysis of non-performing loans and assets:
March 31 December 31 1999 1998 Non-accrual loans............................ $ 320 $ 398 Non-accrual loans to total loans............................... .45% .57% Non-performing assets to total assets........................... .26% .32% Allowance for possible loan losses as a percentage of non-performing loans....................... 215.94% 167.09%
ALLOWANCE FOR POSSIBLE LOAN LOSSES The allowance for possible loan losses is maintained at a level considered adequate to provide for potential loan losses. The level of the allowance is based on management's evaluation of potential losses in the portfolio, after consideration of risk characteristics of the loans and prevailing and anticipated economic conditions. The allowance is increased by provisions charged to expense and reduced by charge-offs, net of recoveries. At March 31, 1999, the allowance for possible loan losses was $691 thousand, up 3.9% from the $665 thousand at year-end 1998. Net charge-offs for the first quarter of 1998 were $7 thousand, partially offsetting the first quarter provision of $33 thousand. LIQUIDITY MANAGEMENT At March 31, 1999, the amount of liquid assets remain at a level management deemed adequate to ensure that contractual liabilities, depositors' withdrawal requirements, and other operational and customer credit needs could be satisfied. At March 31, 1999, liquid investments totaled $20 million, and all mature within 30 days. CAPITAL RESOURCES Total stockholders' equity increased $44 thousand to $9.29 million at March 31, 1999 from $9.24 million at the end of 1998. The increase was due to net income of $192 thousand and offset by a net unrealized loss on securities, available for sale, of $126 thousand for the first three months of 1999. At March 31, 1999, both the Company and the Bank exceeded each of the regulatory capital requirements applicable to it. The table below presents the capital ratios at March 31, 1999 for both the Company and the Bank as well as the minimum regulatory requirements. 13
Regulatory Minimum Amount Ratio Amount Ration ------ ----- ------ ------ The Company Leverage Capital 8,653 6.37% 4,076 3-5% Tier I-Risk Based 8,653 12.64% 2,739 4% Total Risk-Based 9,344 13.64% 5,479 8% The Bank Leverage Capital 8,204 6.04% 4,073 3-5% Tier I-Risk Based 8,204 11.98% 2,739 4% Total Risk-Based 8,895 12.99% 5,477 8%
YEAR 2000 COMPLIANCE The Company's data processing capabilities are critical to its business and its ability to service customers. The Year 2000 problem is caused by many computer programs that were written to identify only the last two digits of a year (a common programming practice on the past to save computer memory). The expectation is that programs may read the year 2000 as 00 or 1900, and to compute interest, payments and other data incorrectly. The Company has put together a team of senior management to evaluate both its data processing systems (software and computers) and other systems (i.e., vault timers, alarms, heating and cooling systems) that are essential to its operations. The Company has examined all of its non-data processing systems and has either received Year 2000 compliant certification from third-party vendors or determined that the systems should not be affected by the Year 2000 problem. The Company does not expect any material costs to address non-data processing systems and has not expended any material costs to date. The Company's present data processing systems have more potential for Year 2000 risk in three areas: (1) its own computers, (2) computers and systems used by borrowers, and (3) vendors who provide the Company with software systems. Our Computers: The Company expended approximately $200,000 in 1998 to upgrade its computer hardware and software systems, primarily our application software. We have budgeted $10,000 for Year 2000 expenditures for 1999, which include a software upgrade for one of our ATM's and various equipment and supplies necessary for our Year 2000 Business Resumption Plan. The Company contracted to have its primary mission-critical application software tested in the fall of 1998. The tests were completed and then evaluated in December 1998 and January 1999. The Company is satisfied with this results. Computers of Others Used by Borrowers: The Company evaluated most of its borrowers and does not believe that the Year 2000 problem should, on an aggregate basis, impact their ability to repay their loans to the Bank. The Company believes that he majority of its individual borrower are not dependent on home computers for income and none of its commercial borrowers are so large that a Year 2000 problem would render them unable to continue their businesses and subsequently be unable to repay their obligations. The Company does not anticipate any material costs to address this risk area. 14 Vendors Who Provide The Company With Software Systems: As stated previously, the Company's primary mission-critical application software system has been upgraded and modified to be Year 2000 compliant. The majority of our critical systems have been deemed Year 2000 compliant, and tests have been completed to confirm these systems are compliant as well as the vendors we communicate with. Other peripheral software systems, which are not considered critical systems, have been reviewed and tested for Year 2000 compliance. Contingency Plan: The Company's remediation Contingency Plan was put in place in 1998 to provide alternatives in the event our primary hardware and software systems were not deemed to be Year 2000 compliant by early 1999. Since our primary systems have been upgraded and tested the remediation plan is no longer necessary. The Company is in the process of finalizing its Year 2000 Business Resumption Contingency Plan and expects to test this plan prior to July of 1999. Business Resumption Contingency Plans are to address the actions that will be taken if critical business functions can't be handled in the normal manner due to system or third-party failures, i.e., power outages, phone communication problems, ATM network failures. These plans are additional to our normal disaster recovery plans. Item 1 Legal Proceedings The Company and the Bank are periodically involved in various legal proceedings as a normal incident to their businesses. In the opinion of management, no material loss is expected from any such pending lawsuit. Item 2 Changes in Securities Not applicable Item 3 Defaults Upon Served Securities Not applicable Item 4 Submission of Matters to a Vote of Security Holders Not applicable Item 5 Other Information Not applicable Item 6 Exhibits and Report on form 8-K (a) Exhibits Number Description 27 Financial Data Schedule (b) Reports on Form 8-K None Date Filed Item - ---------- ---- February 12, 1999 Item 5-- Announcing Year-End Results 15 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned there unto duly authorized. SUSSEX BANCORP Date: May 5, 1999 By:/s/ Candace A. Leatham ------------------------- CANDACE A. LEATHAM Senior Vice President and Chief Financial Officer 16 EX-27 2
9 3-MOS 3-MOS DEC-31-1999 DEC-31-1998 MAR-31-1999 DEC-31-1998 4,976 4,060 150 150 14,875 26,450 0 0 34,781 26,645 9,411 5,939 0 0 70,407 69,346 691 665 139,717 137,467 129,843 127,714 0 0 586 509 0 0 0 0 0 0 5,659 5,635 3,629 3,609 139,717 137,467 1,406 5,601 725 2,694 0 0 2,131 8,295 1,047 3,818 1,047 3,818 1,084 4,477 33 19 3 65 1,107 4,287 240 1,040 240 1,040 0 0 0 0 192 710 0.13 0.50 0.13 0.50 0 0 320 389 0 0 0 0 0 0 665 685 8 40 1 1 691 665 691 665 0 0 0 0
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