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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

Form 10-Q

QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934


For Quarter Ended March 31, 2004  Commission File Number 06253
 

SIMMONS FIRST NATIONAL CORPORATION
(Exact name of registrant as specified in its charter)

Arkansas
(State or other jurisdiction of
incorporation or organization)
 71-0407808
(I.R.S. Employer
Identification No.)
  
501 Main Street        Pine Bluff, Arkansas
(Address of principal executive offices)
 71601
(Zip Code)
   
Registrant’s telephone number, including area code 870-541-1000

Not Applicable
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 Exchange Act of 1934 during the preceding 12 months (or for such shorter period) and (2) has been subject to such filing requirements for the past 90 days.

YES  X    NO     

Indicate the number of shares outstanding of each of issuer’s classes of common stock.

Class A, Common               14,669,789



SIMMONS FIRST NATIONAL CORPORATION

INDEX


Page No.
   
Part I:        Summarized Financial Information
   
Item 1.          Consolidated Balance Sheets —
               March 31, 2004 and December 31, 2003 3-4
   
         Consolidated Statements of Income —
               Three months ended March 31, 2004 and 2003 5
   
         Consolidated Statements of Cash Flows —
               Three months ended March 31, 2004 and 2003 6
   
         Consolidated Statements of Stockholders’ Equity
               Three months ended March 31, 2004 and 2003 7
   
         Condensed Notes to Consolidated Financial Statements 8-19
   
         Review by Independent Certified Public Accountants 20
   
Item 2.          Management’s Discussion and Analysis of Financial
               Condition and Results of Operations 21-42
   
Item 3.          Quantitative and Qualitative Disclosure About Market Risk 43-46
   
Item 4.          Controls and Procedures 46
   
Part II:   Other Information
   
Item 2.          Changes in Securities 47
   
Item 4.          Submission of Matters to a Vote of Security Holders 48
   
Item 6.          Exhibits and Reports on Form 8-K 49
   
Signatures   51



Part I:   Summarized Financial Information
Item 1:  Consolidated Financial Statements and Condensed Notes to Financial Statements

Simmons First National Corporation
Consolidated Balance Sheets
March 31, 2004 and December 31, 2003

ASSETS


(In thousands, except share data) March 31,
2004
December 31,
2003
(Unaudited)
Cash and non-interest bearing balances due from banks $ 69,234           $ 78,205  
Interest bearing balances due from banks   51,747     31,850  
Federal funds sold and securities purchased        
   under agreements to resell   83,660     91,560  
      Cash and cash equivalents   204,641     201,615  
  
Investment securities   544,723     491,950  
Mortgage loans held for sale   13,327     12,211  
Assets held in trading accounts   205     90  
Loans   1,504,173     1,418,314  
   Allowance for loan losses   (26,764 )   (25,347 )
      Net loans   1,477,409     1,392,967  
  
Premises and equipment   51,306     49,369  
Foreclosed assets held for sale, net   2,509     2,979  
Interest receivable   13,683     12,678  
Goodwill   59,454     45,159  
Core deposits, net   6,330     5,258  
Other assets   21,275     21,502  
  
           TOTAL ASSETS $ 2,394,862   $ 2,235,778  

See Condensed Notes to Consolidated Financial Statements.

3



Simmons First National Corporation
Consolidated Balance Sheets
March 31, 2004 and December 31, 2003

LIABILITIES AND STOCKHOLDERS’ EQUITY


(In thousands, except share data) March 31,
2004
December 31,
2003
(Unaudited)
LIABILITIES                  
Non-interest bearing transaction accounts $ 291,594   $ 270,343  
Interest bearing transaction accounts and savings deposits   727,258     670,908  
Time deposits   905,950     862,217  
      Total deposits   1,924,802     1,803,468  
Federal funds purchased and securities sold        
   under agreements to repurchase   88,491     100,209  
Short-term debt   6,257     6,833  
Long-term debt   115,257     100,916  
Accrued interest and other liabilities   30,440     14,357  
      Total liabilities   2,165,247     2,025,783  
  
STOCKHOLDERS’ EQUITY        
Capital stock        
   Class A, common, par value $.01 a share at 2004 and $1.00 at 2003,        
      authorized 30,000,000 shares, 14,669,789 issued and outstanding        
      at 2004 and 14,101,521 (split adjusted) at 2003   147     14,102  
Surplus   64,399     35,988  
Undivided profits   163,625     160,191  
Accumulated other comprehensive income (loss)        
   Unrealized appreciation (depreciation) on available-for-sale securities, net        
       of income taxes of $863 in 2004 and income tax credits of $170 in 2003   1,444     (286 )
   Total stockholders’ equity   229,615     209,995  
  
           TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 2,394,862   $ 2,235,778  

See Condensed Notes to Consolidated Financial Statements.

4



Simmons First National Corporation
Consolidated Statements of Income
Three Months Ended March 31, 2004 and 2003


Three Months Ended
March 31
(In thousands, except per share data) 2004
           2003
(Unaudited)
INTEREST INCOME        
   Loans $ 22,732   $ 22,239  
   Federal funds sold and securities purchased        
      under agreements to resell   195     214  
   Investment securities   4,114     3,984  
   Mortgage loans held for sale   112     300  
   Assets held in trading accounts   3     2  
   Interest bearing balances due from banks   118     135  
           TOTAL INTEREST INCOME   27,274     26,874  
  
INTEREST EXPENSE        
   Deposits   5,466     6,844  
   Federal funds purchased and securities sold        
      under agreements to repurchase   252     223  
   Short-term debt   16     5  
   Long-term debt   1,425     922  
           TOTAL INTEREST EXPENSE   7,159     7,994  
  
NET INTEREST INCOME   20,115     18,880  
   Provision for loan losses   2,144     2,197  
NET INTEREST INCOME AFTER PROVISION        
   FOR LOAN LOSSES   17,971     16,683  
  
NON-INTEREST INCOME        
   Trust income   1,400     1,576  
   Service charges on deposit accounts   3,227     2,454  
   Other service charges and fees   545     479  
   Income on sale of mortgage loans, net of commissions   751     1,164  
   Income on investment banking, net of commissions   215     531  
   Credit card fees   2,310     2,319  
   Student loan premiums   607     306  
   Other income   592     475  
   Gain (loss) on sale of securities, net   —     —  
           TOTAL NON-INTEREST INCOME   9,647     9,304  
  
NON-INTEREST EXPENSE        
   Salaries and employee benefits   11,805     10,742  
   Occupancy expense, net   1,318     1,331  
   Furniture and equipment expense   1,358     1,382  
   Loss on foreclosed assets   44     35  
   Deposit insurance   69     69  
   Other operating expenses   5,098     4,635  
           TOTAL NON-INTEREST EXPENSE   19,692     18,194  
INCOME BEFORE INCOME TAXES   7,926     7,793  
   Provision for income taxes   2,515     2,461  
NET INCOME $ 5,411   $ 5,332  
BASIC EARNINGS PER SHARE $ 0.38   $ 0.38  
DILUTED EARNINGS PER SHARE $ 0.37   $ 0.37  

See Condensed Notes to Consolidated Financial Statements.

5



Simmons First National Corporation
Consolidated Statements of Cash Flows
Three Months Ended March 31, 2004 and 2003


<
(In thousands) March 31,
2004
           March 31,
2003
(Unaudited)
OPERATING ACTIVITIES  
   Net income $ 5,411   $ 5,332  
   Items not requiring (providing) cash        
      Depreciation and amortization   1,295     1,397  
      Provision for loan losses   2,144     2,197  
      Net amortization of investment securities   38     58  
      Deferred income taxes   (362 )   (10 )
      Provision for losses on foreclosed assets   —     42  
   Changes in        
      Interest receivable   (210 )   (386 )
      Mortgage loans held for sale   (1,116 )   7,109  
      Assets held in trading accounts   (115 )   (11,157 )
      Other assets   2,979     (382 )
      Accrued interest and other liabilities   13,602     (2,123 )
      Income taxes payable   1,504     2,171  
           Net cash provided by operating activities   25,170     4,248  
  
INVESTING ACTIVITIES        
   Net origination of loans   (17,972 )   (2,655 )
   Purchase of Alliance Bancorporation, Inc., net   (7,818 )   —  
   Purchase of premises and equipment, net   (1,351 )   (449 )
   Proceeds from sale of foreclosed assets   857     423  
   Proceeds from maturities of available-for-sale securities   22,902     58,037  
   Purchases of available-for-sale securities   (11,741 )   (66,145 )
   Proceeds from maturities of held-to-maturity securities   92,558     52,162  
   Purchases of held-to-maturity securities   (88,630 )   (53,945 )
           Net cash used in investing activities   (11,195 )   (12,572 )
  
FINANCING ACTIVITIES        
   Net increase (decrease) in deposits   10,282     (3,525 )
   Net repayment of short-term debt   (576 )   (1,907 )
   Dividends paid   (1,977 )   (1,769 )
   Proceeds from issuance of long-term debt   2,600     17,470  
   Repayment of long-term debt   (1,040 )   (1,243 )
   Net decrease in federal funds purchased and securities        
     sold under agreements to repurchase