-----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, RuVSpiKyMZ4rWtfUcgHTXOnYBgFtHeFkrbXuM04og+hIhyLklLIHQeu7Kqym38+i MZlsnXuu54BzgdSuJb9A3Q== 0000950124-05-004611.txt : 20050802 0000950124-05-004611.hdr.sgml : 20050802 20050802171350 ACCESSION NUMBER: 0000950124-05-004611 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050802 ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050802 DATE AS OF CHANGE: 20050802 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MACKINAC FINANCIAL CORP /MI/ CENTRAL INDEX KEY: 0000036506 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 382062816 STATE OF INCORPORATION: MI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-20167 FILM NUMBER: 05992852 BUSINESS ADDRESS: STREET 1: 3530 NORTH COUNTRY DR STREET 2: PO BOX 369 CITY: TRAVERSE CITY STATE: MI ZIP: 49684 BUSINESS PHONE: 9063418401 MAIL ADDRESS: STREET 1: 130 S CEDER ST STREET 2: P O BOX 369 CITY: MANISTIQUE STATE: MI ZIP: 49854 FORMER COMPANY: FORMER CONFORMED NAME: NORTH COUNTRY FINANCIAL CORP DATE OF NAME CHANGE: 19990409 FORMER COMPANY: FORMER CONFORMED NAME: FIRST MANISTIQUE CORP DATE OF NAME CHANGE: 19920703 8-K 1 k97353e8vk.txt CURRENT REPORT, DATED AUGUST 2, 2005 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): August 2, 2005 MACKINAC FINANCIAL CORPORATION (previous filings under the name NORTH COUNTRY FINANCIAL CORPORATION) (Exact name of registrant as specified in its charter) MICHIGAN 0-20167 38-2062816 (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 130 SOUTH CEDAR STREET, MANISTIQUE, MICHIGAN 49854 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (800) 200-7032 Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS. (c) Exhibits The following exhibits are furnished herewith:
EXHIBIT NUMBER EXHIBIT DESCRIPTION - ------------ -------------------------------- 99.1 Press Release of Mackinac Financial Corporation dated August 2, 2005
2 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 hereunto duly authorized. MACKINAC FINANCIAL CORPORATION Date: August 2, 2005 By: /s/ Ernie R. Krueger -------------------------------- Ernie R. Krueger SVP/Controller 3 EXHIBIT INDEX
EXHIBIT NUMBER EXHIBIT DESCRIPTION - ------------ -------------------------------- 99.1 Press Release dated August 2, 2005
4 EX-99.1 2 k97353exv99w1.txt PRESS RELEASE DATED AUGUST 2, 2005 [MACKINAC FINANCIAL LOGO] PRESS RELEASE For Release: August 2, 2005 NASDAQ: MFNC Contact: Investor Relations at (800) 200-7032 Website: www.bankmbank.com MACKINAC FINANCIAL CORPORATION REPORTS SECOND QUARTER 2005 AND SIX MONTHS RESULTS OF OPERATIONS (Manistique, Michigan) - Mackinac Financial Corporation (Nasdaq: MFNC), the bank holding company for mBank (the "Bank") today announced a second quarter 2005 loss of $.577 million, or $.17 per share, compared to a loss of $1.600 million, or $4.56 per share for the second quarter of 2004. The loss for the six months amounted to $5.818 million, or $1.70 per share, compared to a loss of $3.267 million, or $9.31 per share, in the six months ended June 30, 2004. The results of operations for the first six months of 2005 include a penalty of $4.320 million on the prepayment of $48.555 million of the FHLB borrowings. Excluding this prepayment penalty, the net loss in the first six months of 2005 amounted to $1.498 million. Weighted average shares in the three months and six months ended June 30, 2005 totaled 3,428,695 compared to 350,958 weighted average shares outstanding for the same periods in 2004. Paul Tobias, Chairman and Chief Executive Officer commented, "In the second quarter of 2005 we made considerable progress in the execution of our business plan. We are experiencing excellent loan demand and have grown our loan portfolio by $671,000 since year-end despite experiencing an unusual level of payouts and refinancing of approximately $28.7 million. We have a good pipeline of diversified loans that we expect to close in the near term and look forward to continued strong loan demand. We introduced the new "mBank" to our markets in the second quarter and are pleased with the initial response to our new name and new consumer product lineup. We are beginning to experience increased lobby traffic and more importantly new account openings and growth in core deposits." Total assets of the Corporation at June 30, 2005 were $276.048 million, down 20.0 percent from the $345.042 million in total assets reported at June 30, 2004. Second quarter-end total assets were down 18.7 percent from the $339.497 million of total assets at year-end 2004. Total loans at the end of the second quarter of 2005 increased $.671 million, or ..3 percent from year-end 2004 total loans of $203.832 million. During the first and second quarter of 2005 mBank generated $10.1 million and $36.9 million in new loans, respectively. This was offset by the unusual level, $28.7 million, of loan payoffs mentioned previously. Total deposits of $207.814 million at June 30, 2005 were down $7.836 million, or 3.6 percent from year-end 2004 deposits of $215.650 million. The Bank experienced decreases in deposits during the second quarter of 2005 largely due to maturing of Internet deposits. Mr. Tobias added, "We have made good progress thus far this year re-branding the bank and developing a marketing campaign to help our talented branch team introduce our revised product line to our customers. We are pleased with the initial signs of interest following our rollout and believe that we will see growth in our customer base and growth in core deposits as we move into 5 the fall." The Bank's credit quality has improved dramatically in the past twelve months with nonperforming loans, as a percent of loans, at .47% compared to 5.69% at June 30, 2004. Nonperforming assets, which amounted to $50.438 million, or 11.94% of assets at December 31, 2003, were reduced to $3.273 million, 1.19% of assets at June 30, 2005. Tobias, commenting on credit quality stated," We have a strong credit culture that has allowed mBank to identify and remove the old problem loans and book new loans with confidence. This credit culture encourages our lending staff to concentrate on high quality loan production and is expected to reduce operating expense in future periods." Shareholders' equity at June 30, 2005 totaled $28.517 million, or $8.32 per share. The Corporation is well capitalized with Tier 1 capital in excess of 9.5% and total risk-based capital in excess of 13.5%. Tobias concluded, "We are pleased with our progress. Our lending team has been successful in closing loans and securing new relationships for mBank The initial growth in core deposits that we are seeing is encouraging. We have many challenges ahead and look forward to returning the Corporation to profitability." Mackinac Financial Corporation is a registered bank holding company which owns mBank. The Bank has 12 branches in Northern Michigan and a commercial banking office in Bloomfield Hills, Michigan. The Company's banking services include commercial lending and treasury management products and services geared toward small to mid-sized businesses; as well as checking and savings accounts, time deposits, interest bearing transaction accounts, safe deposit facilities, real estate mortgage lending, and direct and indirect consumer financing. FORWARD-LOOKING STATEMENTS This release contains certain forward-looking statements. Words such as "anticipates," "believes," "estimates," "expects," "intends," "should," "will," and variations of such words and similar expressions are intended to identify forward-looking statements: as defined by the Private Securities Litigation Reform Act of 1995. These statements reflect management's current beliefs as to expected outcomes of future events and are not guarantees of future performance. These statements involve certain risks, uncertainties and assumptions that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what may be expressed or forecasted in such forward-looking statements. Factors that could cause a difference include among others: changes in the national and local economies or market conditions; changes in interest rates and banking regulations; the impact of competition form traditional or new sources; and the possibility that anticipated cost savings and revenue enhancements from mergers and acquisitions, bank consolidations, branch closings and other sources may not be fully realized at all or within specified time frames as well as other risks and uncertainties including but not limited to those detailed from time to time in filings of the Company with the Securities and Exchange Commission. These and other factors may cause decisions and actual results to differ materially from current expectations. Mackinac Financial Corporation undertakes no obligation to revise, update, or clarify forward-looking statements to reflect events or conditions after the date of this release. 6 MACKINAC FINANCIAL CORPORATION AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS ================================================================================
(Dollars in thousands, except per share data) * For The Period Ended -------------------------------------------------------- June 30, December 31, June 30, 2005 2004 2004 -------------------------------------------------------- (Unaudited) (Unaudited) SELECTED FINANCIAL CONDITION DATA (AT END OF PERIOD): Total assets $ 276,048 $ 339,497 $ 345,042 Total loans 204,503 203,832 233,032 Total deposits 207,814 215,650 235,646 Borrowings and subordinated debentures 36,484 85,039 99,087 Total shareholders' equity $ 28,517 $ 34,730 $ 5,885 SELECTED STATEMENTS OF INCOME DATA (SIX MONTHS AND YEAR ENDED): Net interest income $ 4,593 $ 8,238 $ 4,478 Loss before taxes (5,818) (1,448) (3,267) Net loss (5,818) (1,595) (3,267) Loss per common share - Basic (1.70) (3.23) (9.31) Loss per common share - Diluted (1.70) (3.23) (9.31) THREE MONTHS ENDED Net interest income $ 2,388 $ 1,900 $ 2,467 Income (loss) before taxes (577) 2,580 (1,600) Net income (loss) (577) 2,433 (1,600) Income (loss) per common share - Basic (.17) 8.25 (4.56) Income (loss) per common share - Diluted (.17) 8.25 (4.56) SELECTED FINANCIAL RATIOS AND OTHER DATA (SIX MONTHS AND YEAR ENDED): PERFORMANCE RATIOS: Net interest margin 3.63% 2.57% 2.57% Efficiency ratio 205.52 103.05 148.86 Return on average assets (4.06) (.44) (1.66) Return on average equity (39.18) (18.64) (75.75) Average total assets $ 287,252 $ 365,024 $ 393,618 Average total shareholders' equity $ 29,781 $ 8,555 $ 8,626 Average loans to average deposits ratio 95.51% 97.40% 95.68% COMMON SHARE DATA (AT END OF PERIOD): Market price per common share $ 15.23 $ 17.97 $ 36.40 Book value per common share $ 8.32 $ 10.13 $ 16.77 Common shares outstanding 3,428,695 3,428,695 350,958 OTHER DATA (AT END OF PERIOD): Allowance for loan losses $ 6,636 $ 6,966 $ 10,850 Non-performing assets $ 3,273 $ 6,037 $ 16,819 Allowance for loan losses to total loans 3.24% 3.42% 4.66% Non-performing assets to total assets 1.19% 1.78% 4.87% Number of: Branch locations 12 12 15
* Historical per share data has been adjusted for the 20:1 reverse stock split distributed in December 2004. 7 MACKINAC FINANCIAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS ================================================================================
(DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA) June 30, December 31, June 30, 2005 2004 2004 ------------ ----------- ---------- (Unaudited) (Unaudited) ASSETS Cash and due from banks $ 11,477 $ 4,230 $ 5,707 Federal funds sold 8,767 39,848 9,333 --------- --------- --------- Cash and cash equivalents 20,244 44,078 15,040 Interest-bearing deposits in other financial institutions -- 18,535 15,726 Securities available for sale 36,166 57,075 64,552 Federal Home Loan Bank stock 4,855 4,754 4,652 Total loans 204,503 203,832 233,032 Allowance for loan losses (6,636) (6,966) (10,850) --------- --------- --------- Net loans 197,867 196,866 222,182 Premises and equipment 10,496 10,739 12,430 Other real estate held for sale 2,312 1,730 3,557 Other assets 4,108 5,720 6,903 --------- --------- --------- Total assets $ 276,048 $ 339,497 $ 345,042 ========= ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities: Non-interest-bearing deposits $ 21,033 $ 20,956 $ 21,477 Interest-bearing deposits 186,781 194,694 214,169 --------- --------- --------- Total deposits 207,814 215,650 235,646 Borrowings 36,484 85,039 86,637 Subordinated debentures -- -- 12,450 Other liabilities 3,233 4,078 4,424 --------- --------- --------- Total liabilities 247,531 304,767 339,157 Shareholders' equity: Preferred stock - No par value: Authorized 500,000 shares, no shares outstanding -- -- -- Common stock - No par value: Authorized 18,000,000 shares Issued and outstanding - 3,428,695, 3,428,695 and 350,958 respectively 42,412 42,335 16,175 Accumulated deficit (13,915) (8,097) (9,769) Accumulated other comprehensive income 20 492 (521) --------- --------- --------- Total shareholders' equity 28,517 34,730 5,885 --------- --------- --------- Total liabilities and shareholders' equity $ 276,048 $ 339,497 $ 345,042 ========= ========= =========
8 MACKINAC FINANCIAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS ================================================================================
(Dollars in thousands except per share data) Three Months Ended Six Months Ended ------------------------------- --------------------------- June 30, June 30, June 30, June 30, 2005 2004 2005 2004 ------------------------------- --------------------------- (Unaudited) (Unaudited) (Unaudited) (Unaudited) Interest income: Interest and fees on loans: Taxable $ 3,201 $ 4,069 $ 6,260 $ 7,865 Tax-exempt 230 324 472 643 Interest on securities: Taxable 434 574 896 1,272 Tax-exempt 42 43 84 86 Other interest income 110 143 293 263 -------- -------- -------- -------- Total interest income 4,017 5,153 8,005 10,129 -------- -------- -------- -------- Interest expense: Deposits 1,198 1,378 2,328 3,043 Borrowings 431 1,189 1,084 2,370 Subordinated debentures -- 119 -- 238 -------- -------- -------- -------- Total interest expense 1,629 2,686 3,412 5,651 -------- -------- -------- -------- Net interest income 2,388 2,467 4,593 4,478 Provision for loan losses -- -- -- -- -------- -------- -------- -------- Net interest income after provision for loan losses 2,388 2,467 4,593 4,478 -------- -------- -------- -------- Other income: Service fees 172 287 333 580 Loan and lease fees 4 4 6 9 Net security gains 98 - 97 - Net gains on sale of loans 13 8 20 20 (Loss) on sale of branches -- (254) -- (254) Other 83 18 98 371 -------- -------- -------- -------- Total other income 370 63 554 726 -------- -------- -------- -------- Other expenses: Salaries, commissions, and related benefits 1,606 1,354 3,110 2,853 Furniture and equipment 138 235 297 493 Occupancy 247 279 473 626 Data processing 246 348 492 703 Accounting, legal, and consulting fees 228 572 546 978 Loan and deposit expense 250 600 543 1,093 Telephone 77 19 137 232 Advertising expense 243 26 382 43 Penalty on prepayment of FHLB borrowings -- -- 4,320 -- Other 300 697 665 1,450 -------- -------- -------- -------- Total other expenses 3,335 4,130 10,965 8,471 -------- -------- -------- -------- Loss before provision for income taxes (577) (1,600) (5,818) (3,267) Provision for income taxes -- -- -- -- -------- -------- -------- -------- Net loss $ (577) $ (1,600) $ (5,818) $ (3,267) ======== ======== ======== ======== Loss per common share: Basic $ (.17) $ (4.56) $ (1.70) $ (9.31) ======== ======== ======== ======== Diluted $ (.17) $ (4.56) $ (1.70) $ (9.31) ======== ======== ======== ========
9 MACKINAC FINANCIAL CORPORATION AND SUBSIDIARIES LOAN PORTFOLIO AND CREDIT QUALITY ================================================================================ LOAN PORTFOLIO BALANCES (AT END OF PERIOD):
June 30, December 31, June 30, 2005 2004 2004 ---------- ----------- ----------- COMMERCIAL LOANS Hospitality and tourism $ 43,208 $ 52,659 $ 45,932 Gaming 9,717 14,310 19,344 Petroleum 8,115 7,718 4,648 Forestry 5,180 2,245 1,182 Other 86,099 76,133 114,046 -------- -------- -------- Total Commercial Loans 152,319 153,065 185,152 1-4 family residential real estate 43,012 45,292 44,457 Consumer 2,153 2,379 2,678 Construction 7,019 3,096 745 -------- -------- -------- Total Loans $204,503 $203,832 $233,032 ======== ======== ========
CREDIT QUALITY (AT END OF PERIOD):
June 30, December 31, June 30, 2005 2004 2004 ---------- ------------- ------------ NONPERFORMING ASSETS Nonaccrual loans $ 959 $ 4,307 $ 8,789 Loans past due 90 days or more 2 -- -- Restructured loans -- -- 4,473 -------- ----------- -------- Total nonperforming loans 961 4,307 13,262 Other real estate owned 2,312 1,730 3,557 -------- ----------- -------- Total nonperforming assets $ 3,273 $ 6,037 $ 16,819 ======== =========== ======== Nonperforming loans as a % of loans .47% 2.11% 5.69% -------- ----------- -------- Nonperforming assets as a % of assets 1.19% 1.78% 4.87% -------- ----------- -------- RESERVE FOR LOAN LOSSES: At period end $ 6,636 $ 6,966 $ 10,850 -------- ----------- -------- As a % of loans 3.24% 3.42% 4.66% -------- ----------- -------- As a % of nonperforming loans 690.53% 161.74% 81.81% -------- ----------- -------- As a % of nonaccrual loans 691.97% 161.74% 123.45% ======== =========== ======== CHARGE-OFF INFORMATION: Average loans $198,618 $ 244,730 $266,791 -------- ----------- -------- Net charge-offs $ 330 $ 15,039 $ 11,155 -------- ----------- -------- Charge-offs as a % of average loans .17% 6.15% 4.18% -------- ----------- --------
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