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, 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: 0-22528
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 ¨
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).
YES x NO ¨
Number of shares outstanding of the registrant’s sole class of common stock at February 9, 2004: 6,281,783.
QUAKER CITY BANCORP, INC.
PART I. FINANCIAL INFORMATION
| Item 1. | FINANCIAL STATEMENTS |
Quaker City Bancorp, Inc.
Consolidated Statements of Financial Condition
Unaudited
(In thousands, except share data)
| December 31, 2003 |
June 30, 2003 |
|||||||
| Assets |
||||||||
| Cash and due from banks |
$ | 32,498 | $ | 31,275 | ||||
| Interest-bearing deposits |
930 | 943 | ||||||
| Investment securities held-to-maturity |
7,101 | 12,178 | ||||||
| Investment securities available-for-sale |
47,893 | 48,137 | ||||||
| Loans receivable, net |
1,366,741 | 1,323,268 | ||||||
| Loans receivable held-for-sale |
392 | 2,997 | ||||||
| Mortgage-backed securities held-to-maturity |
156,310 | 90,014 | ||||||
| Mortgage-backed securities available-for-sale |
98,911 | 73,683 | ||||||
| Federal Home Loan Bank stock, at cost |
24,075 | 19,807 | ||||||
| Office premises and equipment, net |
7,410 | 7,275 | ||||||
| Accrued interest receivable and other assets |
12,801 | 12,534 | ||||||
| Total assets |
$ | 1,755,062 | $ | 1,622,111 | ||||
| Liabilities and Stockholders’ Equity |
||||||||
| Deposits |
$ | 1,114,245 | $ | 1,084,117 | ||||
| Federal Home Loan Bank advances |
476,000 | 381,500 | ||||||
| Accounts payable and accrued expenses |
9,817 | 7,269 | ||||||
| Other liabilities |
11,898 | 10,088 | ||||||
| Total liabilities |
1,611,960 | 1,482,974 | ||||||
| Stockholders’ Equity: |
||||||||
| Common stock, $.01 par value. Authorized 20,000,000 shares; issued and outstanding 6,258,927 shares and 6,365,943 at December 31, 2003 and June 30, 2003, respectively |
63 | 64 | ||||||
| Additional paid-in capital |
130,201 | 128,581 | ||||||
| Accumulated other comprehensive loss |
(2,004 | ) | (1,377 | ) | ||||
| Retained earnings, substantially restricted |
15,058 | 12,197 | ||||||
| Deferred compensation |
(216 | ) | (328 | ) | ||||
| Total stockholders’ equity |
143,102 | 139,137 | ||||||
| Total liabilities and stockholders’ equity |
$ | 1,755,062 | $ | 1,622,111 | ||||
See accompanying notes to consolidated financial statements.
3
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, | |||||||||||
| 2003 |
2002 |
2003 |
2002 | |||||||||
| Interest income: |
||||||||||||
| Loans receivable |
$ | 20,246 | $ | 22,195 | $ | 41,313 | $ | 44,205 | ||||
| Mortgage-backed securities |
2,181 | 1,936 | 3,612 | 3,889 | ||||||||
| Investment securities |
453 | 544 | 934 | 1,327 | ||||||||
| Other |
232 | 239 | 481 | 505 | ||||||||
| Total interest income |
23,112 | 24,914 | 46,340 | 49,926 | ||||||||
| Interest expense: |
||||||||||||
| Deposits |
4,919 | 6,337 | 10,094 | 13,048 | ||||||||
| Federal Home Loan Bank advances |
3,689 | 4,000 | 7,289 | 7,790 | ||||||||
| Total interest expense |
8,608 | 10,337 | 17,383 | 20,838 | ||||||||
| Net interest income before provision for loan losses |
14,504 | 14,577 | 28,957 | 29,088 | ||||||||
| Provision for loan losses |
100 | 200 | 100 | 400 | ||||||||
| Net interest income after provision for loan losses |
14,404 | 14,377 | 28,857 | 28,688 | ||||||||
| Other income: |
||||||||||||
| Deposit fees |
1,519 | 1,231 | 2,978 | 2,392 | ||||||||
| Loan service charges and fees |
565 | 474 | 1,227 | 1,092 | ||||||||
| Gain on sale of loans held-for-sale |
443 | 489 | 893 | 601 | ||||||||
| Commissions |
188 | 170 | 415 | 354 | ||||||||
| Gain on sale of securities available-for-sale |
— | 6 | — | 47 | ||||||||
| Other |
339 | 14 | 439 | 151 | ||||||||
| Total other income |
3,054 | 2,384 | 5,952 | 4,637 | ||||||||
| Other expense: |
||||||||||||
| Compensation and employee benefits |
4,337 | 3,701 | 8,584 | 7,515 | ||||||||
| Occupancy, net |
892 | 839 | 1,807 | 1,644 | ||||||||
| Federal deposit insurance premiums |
110 | 108 | 221 | 216 | ||||||||
| Data processing |
540 | 396 | 1,064 | 765 | ||||||||
| Advertising and promotional |
399 | 330 | 890 | 682 | ||||||||
| Consulting fees |
321 | 197 | 544 | 439 | ||||||||
| Other general and administrative expense |
1,179 | 1,306 | 2,336 | 2,520 | ||||||||
| Total general and administrative expense |
7,778 | 6,877 | 15,446 | 13,781 | ||||||||
| Real estate operations, net |
1 | 1 | 1 | 1 | ||||||||
| Amortization of core deposit intangible |
28 | 28 | 57 | 57 | ||||||||
| Total other expense |
7,807 | 6,906 | 15,504 | 13,839 | ||||||||
| Earnings before income taxes |
9,651 | 9,855 | 19,305 | 19,486 | ||||||||
| Income taxes |
4,236 | 4,251 | 8,456 | 8,247 | ||||||||
| Net earnings |
$ | 5,415 | $ | 5,604 | $ | 10,849 | $ | 11,239 | ||||
| Average common shares outstanding |
6,220,383 | 6,289,638 | 6,242,142 | 6,369,189 | ||||||||
| Average shares outstanding and equivalents |
6,419,721 | 6,593,982 | 6,439,150 | 6,678,950 | ||||||||
| Basic earnings per share |
$ | 0.87 | $ | 0.89 | $ | 1.74 | $ | 1.76 | ||||
| Diluted earnings per share |
$ | 0.84 | $ | 0.85 | $ | 1.68 | $ | 1.68 | ||||
See accompanying notes to consolidated financial statements.
4
QUAKER CITY BANCORP, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Unaudited
(In thousands)
| Three Months Ended December 31, |
Six Months Ended December 31, |
|||||||||||||||
| 2003 |
2002 |
2003 |
2002 |
|||||||||||||
| Net earnings |
$ | 5,415 | $ | 5,604 | $ | 10,849 | $ | 11,239 | ||||||||
| Other comprehensive income: |
||||||||||||||||
| Unrealized holding gain (loss) on securities available-for-sale arising during the period, net of tax |
(212 | ) | (702 | ) | (627 | ) | (429 | ) | ||||||||
| Reclassification adjustment for realized (gain) included in net earnings and previously included in other comprehensive income, net of tax |
— | (3 | ) | — | (27 | ) | ||||||||||
| Increase (decrease) in accumulated other comprehensive income, net of tax |
(212 | ) | (705 | ) | (627 | ) | (456 | ) | ||||||||
| Total comprehensive income |
$ | 5,203 | $ | 4,899 | $ | 10,222 | $ | 10,783 | ||||||||
See accompanying notes to consolidated financial statements.
5
QUAKER CITY BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Unaudited
(In thousands)
| Six Months Ended December 31, |
||||||||
| 2003 |
2002 |
|||||||
| Cash flows from operating activities: |
||||||||
| Net earnings |
$ | 10,849 | $ | 11,239 | ||||
| Adjustments to reconcile net earnings to net cash provided by operating activities: |
||||||||
| Depreciation and amortization |
2,342 | 582 | ||||||
| Provision for loan losses |
100 | 400 | ||||||
| Write-downs on real estate held-for-sale |
5 | — | ||||||
| Gain on sale of real estate held-for-sale |
(4 | ) | (4 | ) | ||||
| Gain on sale of loans held-for-sale |
(893 | ) | (601 | ) | ||||
| Gain on sale of securities available-for-sale |
— | (47 | ) | |||||
| Loans originated for sale |
(22,906 | ) | (61,532 | ) | ||||
| Loans purchased for sale |
(8,073 | ) | (6,263 | ) | ||||
| Proceeds from sale of loans held-for-sale |
26,387 | 61,930 | ||||||
| Federal Home Loan Bank stock dividend received |
(423 | ) | & | |||||