x
|
QUARTERLY
REPORT UNDER SECTION 13 AND 15(d) OF THE SECURITIES EXCHANGE ACT
OF
1934
|
¨
|
TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
1934
|
Georgia
|
58-2413468
|
|||
(State
or other jurisdiction of
Incorporation
or organization)
|
(IRS
Employer
Identification
No.)
|
Page
No.
|
||
ITEM
1.
|
Financial
Statements
|
|
3
|
||
4
|
||
5
|
||
6
|
||
Item
2.
|
10
|
|
Item
3.
|
13
|
|
PART
II - OTHER INFORMATION
|
||
ITEM
1.
|
15
|
|
ITEM
2.
|
15
|
|
ITEM
3.
|
15
|
|
ITEM
4.
|
15
|
|
ITEM
5.
|
15
|
September
30,
2005
(unaudited)
|
December
31,
2004
|
||||||
Assets
|
|||||||
Cash
and due from banks
|
$
|
8,788
|
$
|
5,515
|
|||
Federal
funds sold
|
8,222
|
1,363
|
|||||
Securities
available for sale
|
42,231
|
42,518
|
|||||
Restricted
equity securities
|
2,426
|
2,019
|
|||||
Loans
|
203,696
|
127,185
|
|||||
Less
allowance for loan losses
|
2,232
|
1,528
|
|||||
Loans,
net
|
201,464
|
125,657
|
|||||
Premises
and equipment
|
7,828
|
6,150
|
|||||
Goodwill
|
2,334
|
2,334
|
|||||
Core
deposit premium
|
294
|
330
|
|||||
Other
assets
|
10,756
|
9,404
|
|||||
Total
Assets
|
$
|
284,343
|
$
|
195,290
|
|||
Liabilities
and Shareholders' Equity
|
|||||||
Deposits
|
|||||||
Non-interest
bearing
|
$
|
20,719
|
$
|
16,316
|
|||
Interest
bearing
|
198,971
|
122,723
|
|||||
Total
deposits
|
219,690
|
139,039
|
|||||
Other
borrowings
|
33,000
|
25,153
|
|||||
Guaranteed
preferred beneficial interests in junior subordinated
debentures
|
4,124
|
4,124
|
|||||
Other
liabilities
|
1,579
|
1,142
|
|||||
Total
Liabilities
|
258,393
|
169,458
|
|||||
Shareholders'
equity
|
|||||||
Preferred
stock, par value not stated; 2,000,000 shares authorized; no shares
issued
|
$
|
-
-
|
$
|
-
-
|
|||
Common
stock, $1.00 par value, 10,000,000 shares authorized; 2,981,756 and
2,946,476 shares issued
|
2,982
|
2,946
|
|||||
Capital
surplus
|
22,232
|
22,046
|
|||||
Retained
earnings
|
1,696
|
1,589
|
|||||
Accumulated
other comprehensive loss
|
(516
|
)
|
(329
|
)
|
|||
Less
cost of treasury stock, 68,391 and 58,921 shares as of September
30, 2005
and December 31, 2004, respectively
|
(444
|
)
|
(420
|
)
|
|||
Total
shareholders' equity
|
25,950
|
25,832
|
|||||
Total
Liabilities and Shareholders' Equity
|
$
|
284,343
|
$
|
195,290
|
Three
months ended
|
Nine
months ended
|
||||||||||||
September
30,
2005
|
September
30,
2004
|
September
30,
2005
|
September
30,
2004
|
||||||||||
Interest
Income
|
|||||||||||||
Loans
|
3,540
|
1,974
|
8,754
|
5,858
|
|||||||||
Taxable
securities
|
413
|
333
|
1,290
|
926
|
|||||||||
Tax
exempt securities
|
10
|
8
|
28
|
37
|
|||||||||
Deposits
in banks
|
6
|
2
|
14
|
4
|
|||||||||
Federal
funds sold
|
40
|
27
|
100
|
53
|
|||||||||
Total
interest income
|
4,009
|
2,344
|
10,186
|
6,878
|
|||||||||
Interest
expense
|
|||||||||||||
Deposits
|
1,340
|
562
|
2,987
|
1,619
|
|||||||||
Other
borrowed money
|
391
|
221
|
937
|
595
|
|||||||||
Total
interest expense
|
1,731
|
783
|
3,924
|
2,214
|
|||||||||
Net
interest income
|
2,278
|
1,561
|
6,262
|
4,664
|
|||||||||
Provision
for loan losses
|
370
|
20
|
800
|
35
|
|||||||||
Net
interest income after provision for loan losses
|
1,908
|
1,541
|
5,462
|
4,629
|
|||||||||
Other
income
|
|||||||||||||
Service
charges on deposit accounts
|
277
|
257
|
748
|
677
|
|||||||||
Financial
service fees
|
71
|
16
|
140
|
68
|
|||||||||
Mortgage
origination fees
|
257
|
42
|
341
|
135
|
|||||||||
Gain
on sale of investment securities
|
-
-
|
-
-
|
-
-
|
15
|
|||||||||
Gain
(loss)
on
sale of foreclosed properties
|
10
|
12
|
(7
|
)
|
(47
|
)
|
|||||||
Bank
owned life insurance
|
60
|
49
|
181
|
78
|
|||||||||
Other
income
|
31
|
34
|
123
|
97
|
|||||||||
Total
other income
|
706
|
410
|
1,526
|
1,023
|
|||||||||
Other
expenses
|
|||||||||||||
Salaries
and employee benefits
|
1,110
|
809
|
2,860
|
2,337
|
|||||||||
Equipment
and occupancy expense
|
309
|
245
|
872
|
698
|
|||||||||
Marketing
expense
|
50
|
42
|
148
|
147
|
|||||||||
Data
processing expense
|
148
|
122
|
454
|
375
|
|||||||||
Stationary
and supply expense
|
47
|
31
|
138
|
111
|
|||||||||
Administrative
expenses
|
339
|
187
|
988
|
535
|
|||||||||
Loss
on other than temporarily impaired security
|
763
|
-
-
|
763
|
-
-
|
|||||||||
Other
operating expenses
|
194
|
212
|
431
|
549
|
|||||||||
Total
other expenses
|
2,961
|
1,648
|
6,654
|
4,752
|
|||||||||
Income
(loss) before income taxes
|
(347
|
)
|
303
|
334
|
900
|
||||||||
Income
tax expense (benefit)
|
(142
|
)
|
90
|
48
|
282
|
||||||||
Net
Income
|
(205
|
)
|
213
|
286
|
618
|
||||||||
Basic
net income (loss) per common share
|
$
|
(0.07
|
)
|
$
|
0.10
|
$
|
0.10
|
$
|
0.33
|
||||
Diluted
net income (loss) per common share
|
$
|
(0.07
|
)
|
$
|
0.09
|
$
|
0.09
|
$
|
0.31
|
||||
Basic
average shares outstanding
|
2,913,365
|
2,172,941
|
2,907,168
|
1,850,844
|
|||||||||
Diluted
average shares outstanding
|
2,913,365
|
2,327,300
|
3,054,440
|
2,018,002
|
Three
Months Ended
|
Nine
Months Ended
|
||||||||||||
September
30,
2005
|
September
30,
2004
|
September
30,
2005
|
September
30,
2004
|
||||||||||
Net
Income (loss)
|
$
|
(205
|
)
|
$
|
213
|
$
|
286
|
$
|
618
|
||||
Other
comprehensive income (loss)
|
|||||||||||||
Net
unrealized holding gains (losses) arising during period
|
(814
|
)
|
568
|
(1,047
|
)
|
(68
|
)
|
||||||
Tax
benefit (expense) on unrealized holding gains (losses)
|
277
|
(193
|
)
|
356
|
32
|
||||||||
Recognized
loss from other than temporarily impaired security
|
763
|
763
|
|||||||||||
Tax
benefit from recognition of loss
|
(259
|
)
|
(259
|
)
|
|||||||||
Reclassification
adjustment for gains included in net income, net of income taxes
of
$5.
|
-
-
|
-
-
|
-
-
|
(10
|
)
|
||||||||
Total
Other Comprehensive Income (Loss)
|
(33
|
)
|
375
|
(187
|
)
|
(46
|
)
|
||||||
Comprehensive
income (loss)
|
$
|
(238
|
)
|
$
|
588
|
$
|
99
|
$
|
572
|
2005
|
2004
|
||||||
Cash
Flows from operating activities:
|
|||||||
Net
income
|
$
|
286
|
$
|
618
|
|||
Adjustments
to reconcile net income to net cash provided by (used in) operating
activities:
|
|||||||
Depreciation
|
324
|
296
|
|||||
Amortization
of Core Deposit Premium
|
36
|
27
|
|||||
Provision
for loan losses
|
800
|
35
|
|||||
Provision
for deferred taxes
|
(30
|
)
|
110
|
||||
(Increase)
decrease in interest receivable
|
(419
|
)
|
64
|
||||
Recognized
loss from other than temporarily impaired security
|
763
|
-
-
|
|||||
Net
gain on sale of investments available for sale
|
(15
|
)
|
|||||
Other
operating activities
|
(370
|
)
|
(69
|
)
|
|||
Net
cash provided by operating activities
|
1,390
|
1,066
|
|||||
Cash
Flows from Investing Activities:
|
|||||||
Purchase
of property and equipment
|
(2,002
|
)
|
(1,491
|
)
|
|||
Net
increase in federal funds sold
|
(6,859
|
)
|
(7,799
|
)
|
|||
Net
increase in loans
|
(76,607
|
)
|
(7,375
|
)
|
|||
Proceeds
from maturities of securities available for sale
|
1,024
|
3,287
|
|||||
Proceeds
from sale of securities
|
1,980
|
6,090
|
|||||
Purchase
of securities available for sale
|
(4,171
|
)
|
(12,457
|
)
|
|||
Purchase
of bank owned life insurance
|
-
-
|
(6,218
|
)
|
||||
Net
cash used in investing activities
|
(86,635
|
)
|
(25,963
|
)
|
|||
Cash
Flows from Financing Activities:
|
|||||||
Net
increase in deposits
|
80,651
|
10,500
|
|||||
Dividends
paid to shareholders
|
(178
|
)
|
(126
|
)
|
|||
Proceeds
from issuance of common stock, net
|
-
-
|
11,776
|
|||||
Proceeds
from exercise of stock warrants
|
214
|
296
|
|||||
Net
increase in other borrowings
|
7,847
|
4,226
|
|||||
Treasury
stock transactions, net
|
(16
|
)
|
34
|
||||
Net
cash provided by financing activities
|
88,518
|
26,706
|
|||||
Net
increase in cash
|
3,273
|
1,809
|
|||||
Cash
and due from banks at beginning of period
|
5,515
|
4,285
|
|||||
Cash
and due from banks at end of period
|
8,788
|
$
|
6,094
|
||||
Supplemental
Disclosure
|
|||||||
Cash
paid for interest
|
$
|
3,704
|
$
|
2,193
|
|||
Cash
paid for income taxes
|
$
|
-
-
|
$
|
30
|
|||
Non-Cash
Transaction
|
|||||||
Unrealized
losses on securities available for sale
|
$
|
284
|
$
|
68
|
Note
1.
|
Organization
and Summary of Significant Accounting
Policies
|
Three
months Ended
September
30,
|
Nine
Months Ended
September
30,
|
||||||||||||
2005
|
2004
|
2005
|
2004
|
||||||||||
Net
income, as reported
|
$
|
(205,000
|
)
|
$
|
213,000
|
$
|
286,000
|
$
|
618,000
|
||||
Deduct:
Total stock-based employee compensation expense determined under
fair
value based method for all awards, net of related tax
effects
|
(30,000
|
)
|
(42,000
|
)
|
(82,000
|
)
|
(128,000
|
)
|
|||||
Pro
forma net income
|
$
|
(235,000
|
)
|
$
|
171,000
|
$
|
204,000
|
$
|
490,000
|
||||
Earnings
per share:
|
|||||||||||||
Basic
- as reported
|
$
|
(.07
|
)
|
$
|
.10
|
$
|
.10
|
$
|
.33
|
||||
Basic
- pro forma
|
$
|
(.08
|
)
|
$
|
.08
|
$
|
.07
|
$
|
.26
|
||||
Diluted
- as reported
|
$
|
(.07
|
)
|
$
|
.09
|
$
|
.09
|
$
|
.31
|
||||
Diluted
- pro forma
|
$
|
(.08
|
)
|
$
|
.07
|
$
|
.07
|
$
|
.24
|
September
30, 2005
|
December
31, 2004
|
||||||
Interest
bearing demand and savings
|
$
|
53,775,000
|
$
|
47,865,000
|
|||
Certificates
of deposit in denominations of $100,000 or greater
|
85,018,000
|
27,335,000
|
|||||
Other
Certificates of deposit
|
60,178,000
|
47,523,000
|
|||||
Total
|
$
|
198,971,000
|
$
|
122,723,000
|
Tier
1 Capital to risk weighted assets
|
||||
Ratio,
actual
|
13.57
|
%
|
||
Tier
1 Capital minimum requirement
|
4.00
|
%
|
||
Total
Capital to risk weighted assets
|
||||
Ratio,
actual
|
14.72
|
%
|
||
Total
Capital minimum requirement
|
8.00
|
%
|
||
Tier
1 Leverage Ratio
|
10.59
|
%
|
||
Tier
1 Leverage Ratio minimum requirement
|
4.00
|
%
|
Commitments
to extend credit
|
$
|
5,964,000
|
||
Unused
lines of credit
|
52,274,000
|
|||
Standby
letters of credit
|
1,293,000
|
|||
$
|
59,531,000
|
ITEM 3. |
ITEM
1.
|
LEGAL
PROCEEDINGS
|
(a)
|
None
|
(b)
|
None
|
(c)
|
During
July, 2005, the Company purchased 4,885 shares of its common stock
at an
average price of $11.49. The Company has no publicly announced plan
for
repurchase of its stock.
|
ITEM
3.
|
ITEM
5.
|
November
15, 2005
|
/s/
Robert E. Lee
|
||
Date
|
Robert
E. Lee,
|
||
President
|
|||
November
15, 2005
|
/s/
David J. Baranko
|
||
Date
|
David
J. Baranko
|
||
Chief
Financial Officer
|
|||
(Duly
authorized officer and principal financial / accounting
officer)
|