SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
(Mark One)
| [X] | Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. | |
| For the quarterly period ended June 30, 2003, 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: 0-26128 |
| Indiana | 35-1927981 | |
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| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification Number) |
| 9204 Columbia Avenue Munster, Indiana |
46321 | |||
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| (Address of principal executive office) | (ZIP code) |
Registrant’s telephone number, including area code: (219) 836-4400
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 [ ]
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act ). Yes [ ] No [X]
There were 2,744,774 shares of the registrant’s Common Stock, without par value, outstanding at June 30, 2003.
NorthWest Indiana Bancorp
Index
| Page | ||||||||||||||
| Number | ||||||||||||||
PART I Financial Information |
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| Item 1 | Consolidated Financial Statements of NorthWest Indiana Bancorp | |||||||||||||
| Consolidated Balance Sheets, June 30, 2003 and December 31, 2002 | 1 | |||||||||||||
| Consolidated Statements of Income, Three and Six Months Ended | ||||||||||||||
| June 30, 2003 and 2002 | 2 | |||||||||||||
| Consolidated Statements of Changes in Stockholders’ Equity, Three and Six | ||||||||||||||
| Months Ended June 30, 2003 and 2002 | 3 | |||||||||||||
| Consolidated Statements of Cash Flows, Six Months Ended June 30, 2003 | ||||||||||||||
| and 2002 | 4 | |||||||||||||
| Notes to Consolidated Financial Statements | 5-6 | |||||||||||||
| Item 2 | Management’s Discussion and Analysis of Financial Condition and | |||||||||||||
| Results of Operations | 7-16 | |||||||||||||
| Item 3 | Quantitative and Qualitative Disclosures About Market Risk | 17-18 | ||||||||||||
| Item 4 | Controls and Procedures | 19 | ||||||||||||
PART
II. Other Information |
20-21 | |||||||||||||
SIGNATURES |
22 | |||||||||||||
EXHIBITS |
23-26 | |||||||||||||
NorthWest Indiana Bancorp
Consolidated Balance Sheets
| June 30, | December 31, | ||||||||||
| 2003 | 2002 | ||||||||||
| (Dollars in thousands) | (unaudited) | ||||||||||
ASSETS |
|||||||||||
Cash and non-interest bearing balances in financial institutions |
$ | 19,721 | $ | 18,026 | |||||||
Interest bearing balances in financial institutions |
9,135 | 15,625 | |||||||||
Federal funds sold |
787 | 1,549 | |||||||||
Total cash and cash equivalents |
29,643 | 35,200 | |||||||||
Securities available-for-sale |
53,672 | 56,002 | |||||||||
Securities held-to-maturity; fair value: June 30, 2003 - $280,
December 31, 2002 - $594 |
269 | 569 | |||||||||
Loans held for sale |
614 | 601 | |||||||||
Loans receivable |
395,902 | 380,428 | |||||||||
Less: allowance for loan losses |
(3,803 | ) | (3,635 | ) | |||||||
Net loans receivable |
392,099 | 376,793 | |||||||||
Federal Home Loan Bank stock |
2,707 | 2,672 | |||||||||
Accrued interest receivable |
2,251 | 2,363 | |||||||||
Premises and equipment |
11,673 | 9,460 | |||||||||
Foreclosed real estate |
700 | 127 | |||||||||
Other assets |
2,915 | 4,215 | |||||||||
Total assets |
$ | 496,543 | $ | 488,002 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Deposits: |
|||||||||||
Non-interest bearing |
$ | 44,347 | $ | 36,308 | |||||||
Interest bearing |
367,913 | 370,365 | |||||||||
Total |
412,260 | 406,673 | |||||||||
Borrowed funds |
39,609 | 36,065 | |||||||||
Accrued expenses and other liabilities |
4,282 | 6,116 | |||||||||
Total liabilities |
456,151 | 448,854 | |||||||||
Commitments and contingencies |
— | — | |||||||||
Stockholders’ Equity: |
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Preferred stock, no par or stated value;
10,000,000 shares authorized, none outstanding |
— | — | |||||||||
Common
stock, no par or stated value; 10,000,000 shares authorized; |
— | — | |||||||||
shares issued: June 30, 2003 - 2,812,938, |
352 | 351 | |||||||||
December 31, 2002 - 2,807,293 |
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shares outstanding: June 30, 2003 - 2,744,774, |
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December 31, 2002 - 2,739,129 |
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Additional paid in capital |
3,443 | 3,392 | |||||||||
Accumulated other comprehensive income |
879 | 950 | |||||||||
Retained earnings |
37,158 | 35,895 | |||||||||
Treasury stock, common shares at cost: June 30, 2003 - 68,164, |
|||||||||||
December 31, 2002 - 68,16 |
(1,440 | ) | (1,440 | ) | |||||||
Total stockholders’ equity |
40,392 | 39,148 | |||||||||
Total liabilities and stockholders’ equity |
$ | 496,543 | $ | 488,002 | |||||||
See accompanying notes to consolidated financial statements
1
| Three Months Ended | Six Months Ended | ||||||||||||||||||
| (Dollars in thousands, except per share data) | June 30, | June 30, | |||||||||||||||||
| 2003 | 2002 | 2003 | 2002 | ||||||||||||||||
Interest income: |
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Loans receivable |
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Real estate loans |
$ | 5,418 | $ | 5,467 | $ | 10,836 | $ | 10,796 | |||||||||||
Commercial loans |
503 | 566 | 1,002 | 1,111 | |||||||||||||||
Consumer loans |
99 | 138 | 202 | 301 | |||||||||||||||
Total loan interest |
6,020 | 6,171 | 12,040 | 12,208 | |||||||||||||||
Securities |
502 | 758 | 1,100 | 1,568 | |||||||||||||||
Other interest earning assets |
33 | 64 | 52 | 69 | |||||||||||||||
Total interest income |
6,555 | 6,993 | 13,192 | 13,845 | |||||||||||||||
Interest expense: |
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Deposits |
1,610 | 2,186 | 3,327 | 4,467 | |||||||||||||||
Borrowed funds |
326 | 387 | 643 | 764 | |||||||||||||||
Total interest expense |
1,936 | 2,573 | 3,970 | 5,231 | |||||||||||||||
Net interest income |
4,619 | 4,420 | 9,222 | 8,614 | |||||||||||||||
Provision for loan losses |
140 | 150 | 260 | 280 | |||||||||||||||
Net interest income after provision for loan losses |
4,479 | 4,270 | 8,962 | 8,334 | |||||||||||||||
Noninterest income: |
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Fees and service charges |
465 | 442 | 900 | 837 | |||||||||||||||
Gain on sale of loans, net |
174 | 17 | 316 | 53 | |||||||||||||||
Trust operations |
112 | 173 | 234 | 276 | |||||||||||||||
Gain on sale of securities, net |
43 | — | 88 | 89 | |||||||||||||||
Gain/(loss) on sale of foreclosed real estate |
— | 15 | (4 | ) | 24 | ||||||||||||||
Other |
12 | 10 | 16 | 14 | |||||||||||||||
Total noninterest income |
806 | 657 | 1,550 | 1,293 | |||||||||||||||
Noninterest expense: |
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Compensation and benefits |
1,508 | 1,484 | 3,082 | 2,936 | |||||||||||||||
Occupancy and equipment |
498 | 443 | 1,006 | 861 | |||||||||||||||
Data processing |
164 | 158 | 334 | 291 | |||||||||||||||
Marketing |
48 | 45 | 101 | 88 | |||||||||||||||
Other |
729 | 598 | 1,347 | 1,154 | |||||||||||||||
Total noninterest expense |
2,947 | 2,728 | 5,870 | 5,330 | |||||||||||||||
Income before income tax expenses |
2,338 | 2,199 | 4,642 | 4,297 | |||||||||||||||
Income tax expenses |
872 | 832 | 1,733 | 1,624 | |||||||||||||||
Net income |
$ | 1,466 | $ | 1,367 | $ | 2,909 | $ | 2,673 | |||||||||||
Earnings per common share: |
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Basic |
$ | 0.53 | $ | 0.50 | $ | 1.06 | $ | 0.98 | |||||||||||
Diluted |
$ | 0.53 | $ | 0.49 | $ | 1.05 | $ | 0.97 | |||||||||||
Dividends declared per common share |
$ | 0.30 | $ | 0.28 | $ | 0.60 | $ | 0.56 | |||||||||||
See accompanying notes to consolidated financial statements
2
NorthWest Indiana Bancorp
Consolidated Statements of Changes in Stockholders’ Equity
(unaudited)
| Three Months Ended | Six Months Ended | |||||||||||||||||
| (Dollars in thousands) | June 30, | June 30, | ||||||||||||||||
| 2003 | 2002 | 2003 | 2002 | |||||||||||||||
Balance at beginning of period |
$ | 39,638 | $ | 36,231 | $ | 39,148 | $ | 35,882 | ||||||||||
Comprehensive income: |
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Net income |
1,466 | 1,367 | 2,909 | 2,673 | ||||||||||||||
Net unrealized gain/(loss) on securities
available-for-sale, net of reclassifications and tax effects |
78 | 641 | (71 | ) | 377 | |||||||||||||
Comprehensive income |
1,544 | 2,008 | 2,838 | 3,050 | ||||||||||||||
Issuance of shares of common stock |
33 | 56 | 51 | 128 | ||||||||||||||
Cash dividends |
(823 | ) | (767 | ) | (1,645 | ) | (1,532 | ) | ||||||||||
Balance at end of period |
$ | 40,392 | $ | 37,528 | $ | 40,392 | $ | 37,528 | ||||||||||
See accompanying notes to consolidated financial statements
3
| Six Months Ended | ||||||||||||
| (Dollars in thousands) | June 30, | |||||||||||
| 2003 | 2002 | |||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net income |
$ | 2,909 | $ | 2,673 | ||||||||
Adjustments to reconcile net income to
net cash provided by operating activities: |
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Origination of loans for sale |
(10,104 | ) | (2,432 | ) | ||||||||
Sale of loans originated for sale |
10,303 | 3,107 | ||||||||||
Depreciation and amortization, net of accretion |
865 | 598 | ||||||||||
Amortization of mortgage servicing rights |
54 | 20 | ||||||||||
Mortgage servicing rights valuation allowance |
15 | — | ||||||||||
Amortization of investment in real estate limited partnerships |
25 | 25 | ||||||||||
Equity in (gain)/loss of investment in limited partnership,
net of interest received |
11 | (7 | ) | |||||||||
Equity in gain of investment in limited liability corporation |
(25 | ) | — | |||||||||
Net gains on sale of securities |
(88 | ) | (89 | ) | ||||||||
Net gains on sale of loans |
(316 | ) | (53 | ) | ||||||||
Net (gain)/loss on sale of foreclosed real estate |
4 | (24 | ) | |||||||||
Provision for loan losses |
260 | 280 | ||||||||||
Net change in: |
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Interest receivable |
112 | (33 | ) | |||||||||
Other assets |
(963 | ) | (472 | |||||||||