-----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, C1bPQKKY3dZyAOAThn8thX0qTv7TvYWOzXgZ9mKmWY/Li2sMt2YuUL+cRCGFZ03W 3wJ2k06Ms0KbqDdp2OUQ0Q== 0000910195-97-000146.txt : 19970520 0000910195-97-000146.hdr.sgml : 19970520 ACCESSION NUMBER: 0000910195-97-000146 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970331 FILED AS OF DATE: 19970515 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BANK CORP OF GEORGIA CENTRAL INDEX KEY: 0000315708 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 581406233 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 033-98300 FILM NUMBER: 97605981 BUSINESS ADDRESS: STREET 1: 4951 FORSYTH RD CITY: MACON STATE: GA ZIP: 31210 BUSINESS PHONE: 9124774428 MAIL ADDRESS: STREET 1: 4951 FORSYTH RD CITY: MACON STATE: GA ZIP: 31210 10QSB 1 FORM 10-QSB BANK CORPORATION OF GEORGIA UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended March 31, 1997 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXHANGE ACT OF 1934 For the Transition Period from __________ to ___________ Commission file number 071851 Bank Corporation of Georgia --------------------------- (Exact name of registrant as specified in its charter) Georgia 58-1406233 ------- ---------- (State of Incorporation) (I.R.S. Employer Identification No.) 4951 Forsyth Road, Macon, Georgia 31210 ---------------------------------------- (Address of principal executive offices) (912) 757-2000 ------------------------------------------------ (Issuer's telephone number, including area code) Check whether the issuer filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by court. YES _____ No ____ Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 XX No ___ State the number of shares outstanding of each of the issuer's classes of common equity as of March 31, 1997: 2,284,864 shares of Common stock, $1.00 par value per share. BANK CORPORATION OF GEORGIA CONSOLIDATED BALANCE SHEETS MARCH 31, 1997 AND DECEMBER 31, 1996
March 31, 1997 December 31, 1996 -------------- ----------------- Assets ------ Cash and due from banks $ 32,284,816 34,027,974 Federal Funds sold 17,319,695 5,210,000 Investment securities: Held to maturity 1,089,162 1,088,719 Available for sale 47,880,577 42,828,598 ----------- ----------- Total investment securities 48,969,739 43,917,317 ----------- ----------- Loans 189,321,816 190,169,408 Less: Unearned discount (587,500) (736,360) Less: Allowance for loan losses (2,865,000) (2,849,340) ----------- ----------- Loans, net 185,869,316 186,583,708 ----------- ----------- Bank premises and equipment 8,858,478 9,801,980 Accrued interest receivable 1,952,648 2,333,047 Goodwill 1,301,759 1,323,231 Other assets 5,949,087 7,057,065 ----------- ----------- $ 302,505,538 290,254,322 =========== =========== Liabilities and Stockholders' Equity ------------------------------------ Deposits: Demand $ 46,114,503 44,709,405 Interest bearing deposits 92,968,488 79,417,686 Savings 9,044,431 9,405,878 Time 123,125,199 125,165,463 ----------- ----------- Total deposits 271,252,621 258,698,432 ----------- ----------- Accrued interest payable and other liabilities 2,313,338 3,333,327 Long-term debt 1,500,000 1,500,000 ----------- ----------- Total liabilities 275,065,959 263,531,759 ----------- ----------- Stockholders' equity: Common stock 2,284,864 2,284,864 Capital surplus 6,170,157 6,170,157 Retained earnings 19,230,919 18,286,889 Treasury stock (111,540) (111,540) Unearned ESOP shares (196,496) (196,496) Unrealized gain on securities available for sale, net of tax 61,675 288,689 ----------- ----------- Total Stockholders' equity 27,439,579 26,722,563 ----------- ----------- $ 302,505,538 290,254,322 =========== ===========
- 2 - BANK CORPORATION OF GEORGIA CONSOLIDATED BALANCE SHEETS MARCH 31, 1997 AND MARCH 31, 1996
March 31, 1997 March 31, 1996 -------------- -------------- Cash and due from banks $ 32,284,816 7,626,954 Federal Funds sold 17,319,695 12,179,214 Investment securities: Held to maturity 1,089,162 1,136,191 Available for sale 47,880,577 48,555,044 ----------- ----------- Total investment securities 48,969,739 49,691,235 ----------- ----------- Loans 189,321,816 188,308,301 Less: Unearned discount (587,500) (820,896) Less: Allowance for loan losses (2,865,000) (2,679,468) Loans, net 185,869,316 184,807,937 ----------- ----------- Bank premises and equipment 8,858,478 8,729,223 Accrued interest receivable 1,952,648 2,094,097 Goodwill 1,301,759 892,878 Other Assets 5,949,087 5,321,262 ----------- ----------- $ 302,505,538 271,342,800 =========== =========== Liabilities and Stockholders' Equity ------------------------------------ Deposits: Demand $ 46,114,503 36,048,440 Interest bearing deposits 92,968,488 64,197,441 Savings 9,044,431 10,158,246 Time 123,125,199 125,604,365 ----------- ----------- Total deposits 271,252,621 236,008,492 ----------- ----------- Accounts payable and accruals 2,313,338 2,271,110 Other borrowed money -- 6,100,000 Long-term debt 1,500,000 2,400,000 ----------- ----------- Total liabilities 275,065,959 246,779,602 ----------- ----------- Stockholders' equity: Common stock 2,284,864 2,282,266 Capital surplus 6,170,157 6,161,387 Retained earnings 19,230,919 16,070,894 Unearned ESOP shares (196,496) (270,809) Treasury stock (111,540) (111,540) Unrealized gain on securities AFS 61,675 431,000 ----------- ----------- Total stockholders' equity 27,439,579 24,563,198 ----------- ----------- $ 302,505,538 271,342,800 =========== ===========
- 3 BANK CORPORATION OF GEORGIA CONSOLIDATED STATEMENTS OF EARNINGS FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND MARCH 31, 1996
Three Months ended: March 31, 1997 March 31, 1996 -------------- -------------- Interest income: Interest and fees on loans $ 5,135,072 4,941,463 Interest on federal funds sold 126,415 170,534 Interest on investment securities 997,760 769,331 --------- --------- Total interest income 6,259,247 5,881,328 --------- --------- Interest expense: Interest on NOW and money market accounts 718,235 479,152 Interest on savings and time deposits 1,720,052 1,868,528 Other borrowings 27,187 63,855 --------- --------- Total interest expense 2,465,474 2,411,535 --------- --------- Net interest income 3,793,773 3,469,793 Provision for loan losses 86,926 121,000 --------- --------- Net interest income after provision for loan losses 3,706,847 3,348,793 --------- --------- Other operating income: Service charge on deposit accounts 360,402 359,637 Gain on sale of loans 156,534 5,739 Miscellaneous 256,144 275,124 --------- --------- Total other operating income 773,080 640,500 --------- --------- Other operating expenses: Salaries and employee benefits 1,965,515 1,529,841 Occupancy and equipment 478,834 358,913 Miscellaneous 628,479 794,563 --------- --------- Total operating expenses 3,072,828 2,683,317 --------- --------- Earnings before income taxes and minority interest in earnings of subsidiary 1,407,099 1,305,976 Income taxes 463,069 388,000 --------- --------- Earnings before minority interest in earnings of subsidiary 944,030 917,976 Minority interest in earnings of subsidiary -- 46,913 --------- --------- Net earnings $ 944,030 871,063 ========= ========= Net Earnings per share: Primary $ 0.40 0.40 Fully diluted $ 0.39 0.40 Weighted average number of shares Primary $ 2,388,192 2,198,338 Fully diluted $ 2,394,509 2,202,167
- 4 - BANK CORPORATION OF GEORGIA CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND MARCH 31, 1996
Three Months Ended: March 31,1997 March 31, 1996 ------------- -------------- Cash flows from operating activities: Net income $ 944,030 871,063 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation 196,118 170,941 Amortization and accretion, net (23,330) (39,743) Minority interests in earnings of subsidiary -- 46,916 Provision for loan losses 86,926 121,000 Gain on sale of premises and equipment (148,104) -- Change in: Accrued interest receivable and other assets 1,787,810 383,262 Accrued interest payable and other liabilities (1,019,989) (710,566) ---------- ---------- Net cash flows provided by operating activities 1,823,461 842,873 ---------- ---------- Cash flows from investing activities: Proceeds from maturities of securities available for sale 2,587,103 2,312,624 Purchase of securities available for sale (7,894,161) (12,119,222) Net change in loans 627,466 (7,184,327) Purchase of premises and equipment (104,164) (976,616) Proceeds from sales of premises and equipment 772,643 -- ---------- ---------- Net cash flows used in investing activities (4,011,113) (17,967,541) ---------- ---------- Cash flows from financing activities: Net increase in deposits 12,554,189 11,719,753 Repayment of other borrowings -- (100,000) Proceeds from issuance of common stock -- 21,701 ---------- ---------- Net cash flows provided by financing activities 12,554,189 11,641,454 ---------- ---------- Net increase in cash and cash equivalents 10,366,537 (5,483,214) Cash and cash equivalents at beginning of period 39,237,974 25,289,382 ---------- ---------- Cash and cash equivalents at end of period $ 49,604,511 19,806,168 ========== ==========
- 5 - NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The financial statements included herein have been prepared by Bank Corporation of Georgia (BCG), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although BCG believes that the disclosures contained herein are adequate to make the information presented not misleading. In the opinion of management, the information furnished in the condensed consolidated financial statements reflects all adjustments which are ordinary in nature and necessary to present fairly BCG's financial position, results of operations and changes in financial position for such interim period. These financial statements should be read in conjunction with BCG's financial statements and the notes thereto as of December 31, 1996, included in BCG's annual report on Form 10KSB for the year ended December 31, 1996. Bank Corporation of Georgia is a bank holding company whose business is primarily conducted by its wholly-owned banking subsidiaries First South Bank, N. A. ("FSB") and Ameribank, N. A. ("Ameribank"). The accounting principles followed by Bank Corporation of Georgia and its subsidiaries, and the methods of applying those principles conform with generally accepted accounting principles and with general practices within the banking industry, where applicable. During 1997, the Financial Accounting Standards Board has issued Statement of Financial Accounting Standards No. 128, "Earnings Per Share" (SFAS 128). SFAS 128 supersedes APB Opinion 15. SFAS 128 simplifies current standards by eliminating the presentation of primary EPS and requiring the presentation of basic EPS, which includes no potential common shares and thus no dilution. The Statement also requires entities with complex capital structures to present basic and diluted EPS on the face of the income statement and also eliminates the modified treasury stock method of computing potential common shares. The Statement is effective for financial statements issued for periods ending after December 15, 1997, including interim periods. Early application is not permitted. On adoption, restatement of all prior-period EPS data presented is required. Presently, BCG is unable to determine the impact that adoption of SFAS 128 will have on the consolidated financial statements, but management anticipates that the impact will not be material. - 6 - MANAGEMENT'S DISCUSSION AND ANALYSIS Earnings Summary - ---------------- Net income for the first three months of 1997 was $944,000, an increase of $73,000 or 8.4 percent over the same period in 1996. The net income per share for the three months ended March 31, 1997 and 1996 was $.40 and $.40, respectively. Net interest income for the three months ended March 31, 1997 increased $324,000 or 9.3 percent over the same period in 1996. The increase is primarily due to an increase in net interest earning assets over the same period in 1996. The net interest margin, as a percentage of earning assets, decreased to 5.78 percent for the first three months of 1997 as compared to 5.89 percent for the same period in 1996. Non- interest income for the three month period ended March 31, 1997 increased $133,000 or 20.8 percent over the same period in 1996. These increases were primarily the result of increases in gains on sales of SBA loans and gains on sales of other loans. Non-interest expense increased by $390,000 in the first three months of 1997 from the same period in 1996, an increase of 14.5 percent. Increases in salaries and employee benefits of $436,000 or 28.5 percent and in occupancy and equipment expense of $120,000 or 33 percent over similar periods in 1996 are related to the addition of three branches added during 1996. For the first three months of 1997, return on equity was 13.9 percent on an annualized basis versus 14.6 percent for the same period a year earlier. The decline in return on equity was related to several factors, among which were the cessation of tax benefits related to net operating losses from Ameribank and the costs associated with the three branch acquisitions or openings discussed above. Risk Elements - ------------- The allowance for loan losses at March 31, 1997 was $2,765,000 or 3.2 % higher than at March 31, 1996. At March 31, 1997, the allowance represented 1.46 % of total loans as compared with 1.42 % at March 31, 1996 and 1.50% at December 31, 1996. At March 31, 1997 non-performing loans represented .19% of total loans as compared with .38 % at December 31, 1996 and .48% at March 31, 1996. The allowance for loan losses as a percentage of non-performing loans was 765% at March 31, 1997 as compared with 394% at December 31, 1996 and 794% at March 31, 1996. Capital Resources - ----------------- Shareholders' equity of $27,439,579 at March 31, 1997 increased 2.8 percent from December 31, 1996 and 11 percent over the same period in 1996 resulting in book value per outstanding common of share of $12.01 compared to $11.70 at December 31, 1996 and $10.76 at March 31, 1996. Capital for - 7 - BCG is above regulatory requirements, with GAAP equity of 9.07 percent of total assets at March 31, 1997 compared to 9.21 percent at December 31, 1996 and 9.05 percent at March 31, 1996. The increases in shareholders' equity was primarily the result of net earnings. Recent Developments - ------------------- On March 17, 1997, the Board of Directors of BCG signed a statement of intent to merge with Century South Banks, Inc. ("Century"), a ten bank holding company headquartered in Gainesville, Georgia. Under the terms of the statement of intent, shareholders of BCG will receive 1.33 shares of Century stock for each share of BCG stock they own. The Board expects the merger, which is subject to regulatory and shareholder approval, to be consummated in the third quarter 1997. Set forth below are pertinent capital ratios for the Company and the Banks as of March 31, 1997:
First South Minimum Capital Requirements: Bank Ameribank ---------------------------- ----- --------- Tier 1 Capital to Risk- based Assets: 4.00% 12.25% 11.77% Total Capital to Risk- based Assets: 8.00% 12.55% 12.95% Leverage Ratio (Tier 1 Capital to Total Assets): 8.54% 8.05%
Minimum for "Well Capitalized" Banks = 8% Minimum for "Well Capitalized" Banks = 10% Minimum for "Well Capitalized" Banks = 6% Liquidity and Interest Rate Sensitivity - --------------------------------------- Liquidity management involves the ability to meet cash flow requirements of customers who may be depositors making withdrawals or borrowers needing credit funding. BCG's cash flows are generated from interest and fee income, as well as from loan repayments, deposit acquisition, and maturities or sales of investments. BCG's liquidity needs are provided for primarily through short-term securities, and the maturing of loans. Federal funds sold represent BCG's primary source of immediate liquidity and were maintained at a level adequate to meet immediate needs. Federal funds averaged $23,111,000 and $11,360,000 for the three months ended March 31, 1997 and March 31,1996, respectively. Maturities in BCG's loan and investment portfolios are monitored regularly to avoid matching short- term deposits with long-term loans and investments. Other assets and liabilities are also monitored to provide the proper balance between liquidity, safety, and profitability. This monitoring process must be continuous due to the constant flow of cash which is inherent in a financial institution. - 8 - BCG actively manages its interest rate sensitive assets and liabilities to reduce the impact of interest rate fluctuations. At March 31, 1997, BCG's rate sensitive liabilities exceeded rate sensitive assets due within one year by $17.6 million. BCG manages its liquidity through the volatility of its deposits and patterns in loan demand, its current liquidity position, its ability to control funding needs and potential sources of funds. As part of managing liquidity, the Company monitors its loan to deposit ratio on a daily basis. The target ratio is 75 percent. At March 31, 1997 the ratio was 70 percent. BCG experienced a net increase in cash and cash equivalents, its primary source of liquidity, of $10,366,537 during the first three months of 1997. Operating activities provided $1,823,461 of funds. Adjustments to net earnings for non-cash expenses of depreciation, amortization, and provision for loan losses are included in this amount as a net provision of funds. Investing activities used $4,011,113 of funds, primarily due to an purchases of securities available for sale of approximately $7,894,000 offset by calls and maturities of securities available for sale of approximately $2,587,000, as well as proceeds from the sale of premises and equipment of approximately $773,000. Financing activities provided $12,554,189, from an increase in deposits during the three month period ended March 31, 1997. - 9 - PART II. OTHER INFORMATION Item 1. Legal Proceedings Neither Bank Corporation of Georgia nor its subsidiaries is a party to any pending legal proceedings which management believes would have a material effect upon the operations or financial condition of Bank Corporation of Georgia. Item 2. Changes in Securities - Not applicable. Item 3. Defaults Upon Senior 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 Reports on Form 8K Not applicable. (a) Exhibits. Exhibit 27 - Financial Data Schedule (b) Reports on Form 8-K. Not applicable SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized. Dated: _______________________ BANK CORPORATION OF GEORGIA /s/ Nancy J. Carter Nancy J. Carter Controller (Principal Financial Officer) - 11 - EX-27 2 FINANCIAL DATA SCHEDULE
9 0000315708 BANK CORPORATION OF GEORGIA 3-MOS DEC-31-1997 JAN-01-1997 MAR-31-1997 32,285 0 17,320 0 47,880 1,089 1,076 185,869 2,865 302,506 271,253 0 2,313 1,500 0 0 2,285 25,155 302,506 5,135 998 126 6,259 2,438 2,465 3,794 87 0 3,073 1,408 1,408 0 0 944 0.40 0.39 5.78 349 12 0 0 2,849 115 44 2,865 2,865 0 0
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