QUAKER CITY BANCORP INC - 10-Q Quarterly Report

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2002

OR

o	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: 0-22528

QUAKER CITY BANCORP, INC .

(Exact name of registrant as specified in its charter)

DELAWARE		95-4444221

(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

7021 GREENLEAF AVENUE, WHITTIER, CALIFORNIA		90602

(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (562) 907-2200

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x

No o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes x

No o

Number of shares outstanding of the registrant’s sole class of common stock at February 7, 2003: 6,394,339.

QUAKER CITY BANCORP, INC.
Index


PART I.	FINANCIAL INFORMATION

ITEM 1.	Financial Statements

	Consolidated Statements of Financial Condition (unaudited) as of December 31, 2002 and June 30, 2002	3

	Consolidated Statements of Operations (unaudited) for the Three and Six Months Ended December 31, 2002 and 2001	4

	Consolidated Statements of Comprehensive Income (unaudited) for the Three and Six Months Ended December 31, 2002 and 2001	5

	Consolidated Statements of Cash Flows (unaudited) for the Six Months Ended December 31, 2002 and 2001	6

	Notes to Consolidated Financial Statements	8

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11

ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	23

ITEM 4.	Controls and Procedures	23

PART II.	OTHER INFORMATION

ITEM 4.	Submission of Matters to a Vote of Security Holders	24

ITEM 5.	Other Information	24

ITEM 6.	Exhibits and Reports on Form 8-K	25

SIGNATURES		32

CERTIFICATIONS		33

Item 1. FINANCIAL STATEMENTS

Quaker City Bancorp, Inc.
Consolidated Statements of Financial Condition
Unaudited
(In thousands, except share data)

			December 31, 2002			June 30, 2002

Assets
	Cash and due from banks		$	18,750		$	14,128
	Interest-bearing deposits			637			762
	Federal funds sold and other short-term investments			—			3,500
	Investment securities held-to-maturity			17,245			14,273
	Investment securities available-for-sale			29,558			79,234
	Loans receivable, net			1,254,053			1,193,035
	Loans receivable held-for-sale			9,864			3,436
	Mortgage-backed securities held-to-maturity			120,619			117,827
	Mortgage-backed securities available-for-sale			81,465			26,449
	Real estate held-for-sale			37			18
	Federal Home Loan Bank stock, at cost			19,340			16,685
	Office premises and equipment, net			7,699			7,327
	Deferred tax asset			973			324
	Accrued interest receivable and other assets			11,219			10,436

		Total assets	$	1,571,459		$	1,487,434

Liabilities and Stockholders’ Equity
	Deposits		$	1,028,976		$	1,009,725
	Federal Home Loan Bank advances			386,800			330,700
	Accounts payable and accrued expenses			6,809			8,605
	Other liabilities			19,086			9,893

		Total liabilities		1,441,671			1,358,923
	Stockholders’ Equity:
	Common stock, $.01 par value. Authorized 20,000,000 shares; issued and outstanding 6,336,888 shares and 6,610,017 at December 31, 2002 and June 30, 2002, respectively			63			66
	Additional paid-in capital			125,315			124,428
	Accumulated other comprehensive loss			(700	)		(244	)
	Retained earnings, substantially restricted			5,550			4,818
	Deferred compensation			(440	)		(557	)

		Total stockholders’ equity		129,788			128,511

		Total liabilities and stockholders’ equity	$	1,571,459		$	1,487,434

See accompanying notes to consolidated financial statements.

Quaker City Bancorp, Inc.
Consolidated Statements of Operations
Unaudited
(In thousands, except share and per share data)

			Three Months Ended December 31,				Six Months Ended December 31,

			2002		2001		2002		2001

Interest income:
	Loans receivable		$	22,195	$	22,644	$	44,205	$	45,779
	Mortgage-backed securities			1,936		2,087		3,889		4,114
	Investment securities			544		501		1,327		1,105
	Other			239		254		505		540

		Total interest income		24,914		25,486		49,926		51,538

Interest expense:
	Deposits			6,337		8,478		13,048		18,331
	Federal Home Loan Bank advances			4,000		3,902		7,790		7,835

		Total interest expense		10,337		12,380		20,838		26,166

	Net interest income before provision for loan losses			14,577		13,106		29,088		25,372
Provision for loan losses				200		200		400		200

	Net interest income after provision for loan losses			14,377		12,906		28,688		25,172

Other income:
	Deposit fees			1,231		861		2,392		1,675
	Loan service charges and fees			474		562		1,092		1,078
	Gain on sale of loans held-for-sale			489		113		601		274
	Commissions			170		247		358		482
	Gain on sale of securities available-for-sale			6		—		47		—
	Other			14		12		147		25

		Total other income		2,384		1,795		4,637		3,534

Other expense:
	Compensation and employee benefits			3,701		3,176		7,515		6,390
	Occupancy, net			839		721		1,644		1,446
	Federal deposit insurance premiums			108		100		216		200
	Data processing			396		301		765		607
	Advertising and promotional			330		380		682		693
	Consulting fees			197		213		439		355
	Other general and administrative expense			1,306		892		2,520		1,788

		Total general and administrative expense		6,877		5,783		13,781		11,479
	Real estate operations, net			1		—		1		—
	Amortization of core deposit intangible			28		28		57		57

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