10-Q 1 d10032e10vq.txt FORM 10-Q FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter Ended September 30, 2003 Commission File Number 0-11928 AMERICAN BANCORP, INC. ------------------------------------------------------------------- (Exact name of registrant as specified in its charter) LOUISIANA 72-0951347 ------------------------------- ------------------------------- (State or other jurisdiction of (I R S Employer I. D. Number) incorporation or organization) 321 EAST LANDRY STREET, OPELOUSAS, LA 70570 --------------------------------------- -------------------------- (Address of principal executive office) (Zip Code) (337) 948-3056 ------------------------------------------------------------------- (Registrant's telephone number, including area code) NOT APPLICABLE ------------------------------------------------------------------- (Former name, address, 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 periods 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 ----- ---- APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practical date. Common stock, $5 Par Value----115,987 shares as of October 31, 2003 AMERICAN BANCORP, INC. (PARENT COMPANY ONLY) BALANCE SHEET (In Thousands)

See Notes to Consolidated Financial Statements. AMERICAN BANCORP, INC. CONSOLIDATED BALANCE SHEETS (In Thousands)

See Notes to Consolidated Financial Statements. AMERICAN BANCORP, INC. (PARENT COMPANY ONLY) STATEMENTS OF INCOME (Unaudited) (In Thousands )

See Notes to Consolidated Financial Statements. AMERICAN BANCORP, INC. CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (In Thousands Except for Per Share Data)

See Notes to Consolidated Financial Statements AMERICAN BANCORP, INC. CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY For the Nine Month Periods Ended September 30, 2003 & 2002 (Unaudited) (In Thousands)

See Notes to Consolidated Financial Statements AMERICAN BANCORP, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In Thousands)

See Notes to Consolidated Financial Statements AMERICAN BANCORP, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS September 30, 2003 NOTE 1 - A BASIS OF PRESENTATION The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted principles of accounting for instructions to Form 10-Q and Article 10 of Regulations S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments ( consisting of normal recurring accruals ) considered necessary for a fair presentation have been included. Operating results for the nine month period ended September 30, 2003 are not necessarily indicative of the results that may be expected for the year ended December 31, 2003. The balance sheet at December 31, 2002 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in American Bancorp, Inc.'s annual report on Form 10-K for the year ended December 31, 2002. NOTE 2 - IMPAIRED LOANS In accordance with Statement of Financial Accounting Standards (SFAS) No.114, interest payments received on impaired loans are applied to principal if there is doubt as to the collectibility of the principal; otherwise, these receipts are recorded as interest income. As it relates to in-substance foreclosures, SFAS No. 114 requires that a creditor continue to follow loan classification on the balance sheet unless the creditor receives physical possession of the collateral. The Company had no in-substance foreclosures in foreclosed assets to transfer to nonperforming loans and no related reserve for losses to transfer to the reserve for possible loan losses. NOTE 3 - RELATED PARTIES Directors, executive officers, and 10% shareholders and their related interest had loans outstanding totaling $1,242,000 at September 30, 2003. NOTE 4- EARNINGS PER SHARE The earnings per share computations are based on weighted average number of shares outstanding during each quarter of 115,987 and 116,250 for the quarters ended September 30, 2003 and 2002, respectively and during each nine month period of 116,018 and 116,352 for the nine month periods ended September 30, 2003 and 2002, respectively. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Management's Discussion presents a review of the major factors and trends affecting the performance of the Company and its bank subsidiary and should be read in conjunction with the accompanying consolidated financial statements and notes. OVERVIEW The Company reported net income of $786,000 for the first nine months of 2003 compared to $1,061,000 for the same period of 2002. On a per share basis, the net income was $6.77 for the first nine months of 2003 compared to $9.12 for the same period of 2002 and $2.25 for the quarter ended September 30, 2003 compared to $3.17 for the same quarter of 2002. The Company recorded a provision for possible loan losses of $32,000 for the nine month periods ended September 30, 2003 and 2002. Net interest income decreased 9.8% to $2,783,000 for the first nine months of 2003 compared to $3,087,000 for the same period of 2002. Total assets were $97,544,000 at September 30, 2003, a decrease of $2,175,000 from December 31, 2002. Loans decreased by $745,000 or 1.9% from $39,931,000 at December 31, 2002 to $39,186,000 at September 30, 2003. Deposits decreased by $2,693,000 or 3.2% from $84,778,000 at December 31, 2002 to $82,085,000 at September 30, 2003. RESULTS OF OPERATIONS NET INTEREST INCOME. Net interest income for the nine months ended September 30, 2003 totaled $2,783,000, a $304,000 decrease from the same period in 2002. The greatest contributing factors to this decrease were decreases in the yield from investment securities and loans, which were partially offset by decreases in the interest paid on deposits. The overall effect of volume and rate changes on net interest income during the three month period ended September 30, 2003 was unfavorable. PROVISION FOR POSSIBLE LOAN LOSSES. The Company recorded provisions for possible loan losses of $32,000 for the first nine months of both 2003 and 2002. As a percentage of outstanding loans, the allowance for possible loan losses was 1.7% and 1.5% at September 30, 2003 and December 31, 2002, respectively. The provision is determined by the level of net chargeoffs, the size of the loan portfolio, the level of nonperforming loans, anticipated economic conditions, and review of financial condition of specific customers. NONINTEREST INCOME. For the first nine months of 2003 noninterest income increased $11,000 or 2.2% compared to the same period of 2002. Other noninterest income increased by $9,000 or 8.9% compared to the same period of 2002. The increase is the result of an incease in income from rental of bank premises for the first nine months of 2003. There were no securities gains in the nine month periods ended September 30, 2003 and 2002. NONINTEREST EXPENSE. For the first nine months of 2003, noninterest expense increased $135,000 or 6.3% compared to the same period in 2002. Salaries and employee benefits, the largest component of noninterest expense, increased by $44,000 or 4.0% for the first nine months of 2003 as compared to the same period in 2002. This increase was attributed mostly to an overall increase in salaries and adjustments to accruals for deferred compensation. Net occupancy expense increased by $22,000 or 5.1% for the first nine months of 2003 as compared to the same period in 2002. INCOME TAXES. The Company recorded provisions for income taxes of $215,000 for the nine month period ended September 30, 2003 as compared to $368,000 for the same period of 2002. FINANCIAL CONDITION LOANS. Loans were $39,186,000 at September 30, 2003; down by $745,000 or 1.9% from December 31, 2002. TABLE I - COMPOSITION OF LOAN PORTFOLIO (In thousands)

SECURITIES HELD TO MATURITY. Securities held to maturity were $1,601,000 at September 30, 2003; down by $503,000 or 23.91% from December 31, 2002. SECURITIES AVAILABLE FOR SALE. Securities available for sale were $43,486,000 at September 30, 2003; up by $5,765,000 or 15.28% from December 31, 2002. TABLE II - INVESTMENT SECURITIES (In thousands) A comparison of the book value and estimated market value of investment securities is as follows:

TABLE III - NONPERFORMING ASSETS Nonperforming assets include nonaccrual loans, loans which are contractually 90 days past due, restructured loans, and foreclosed assets. Restructured loans are loans which, due to a deteriorated financial condition of the borrower, have a below market yield. Interest payments received on nonperforming loans are applied to reduce principal if there is doubt as to the collectibility of the principal; otherwise, these receipts are recorded as interest income. Certain nonperforming loans that are current as to principal and interest payments are classified as nonperforming because there is a question concerning full collectibility of both principal and interest. Nonperforming assets totaled $2,000 at September 30, 2003, and $3,000 (a 33.3 % decrease) from December 31, 2002. The composition of nonperforming assets are illustrated below:

TABLE IV - ANALYSIS OF ALLOWANCE FOR LOAN LOSSES (In thousands)

The present level of the allowance for loan losses is considered adequate to absorb future potential loan losses. In making this determination, management considered asset quality, the level of net loan chargeoffs, as well as current economic conditions and market trends. TABLE V - ALLOCATION OF THE ALLOWANCE FOR LOAN LOSSES (In thousands) The allowance for possible loan losses has been allocated according to the amount deemed to be reasonably necessary to provide for the possibility of losses being incurred within the following categories of loans.

DEPOSITS. As of September 30, 2003 total deposits have decreased by $2,693,000 or 3.2% from December 31, 2002. Noninterest-bearing deposits increased by $2,879,000 or 9.8% from December 31, 2002 to September 30, 2003. Interest-bearing deposits decreased by $5,572,000 or 10.1% from December 31, 2002 to September 30, 2003. CAPITAL. Shareholders' equity totaled $14,166,000 at September 30, 2003, compared to $13,632,000 at December 31, 2002. The increase is primarily the result of year to date net income. Risk-based capital and leverage ratios for the Company and the bank subsidiary exceed the ratios required for the designation as a "well-capitalized" institution under regulatory guidelines. TABLE VI - CAPITAL RATIOS

PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS In the normal course of business, the bank becomes involved in legal proceedings. It is the opinion of management that the resulting liability, if any, for pending litigation is negligible. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 31.1 Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Company's Principal Executive Officer 31.2 Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Company's Principal Financial Officer 32.1 Certification pursuant to 18 U.S.C. Section 1350 by the Company's Principal Executive Officer 32.2 Certification pursuant to 18 U.S.C. Section 1350 by the Company's Principal Financial Officer 32.3 Disclosure of approval by the Company's Audit Committee for the performance of nonaudit services by the Company's Independent Auditors pursuant to 18 U.S.C. Section 1350 32.4 Disclosure on controls pursuant to 18 U.S.C. Section 1350 by the Company's Principal Executive Officer 32.5 Disclosure on controls pursuant to 18 U.S.C. Section 1350 by the Company's Principal Financial Officer (b) Repots on Form 8-K NONE SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized to sign on behalf of the registrant. AMERICAN BANCORP, INC. ----------------------------------- (Registrant) November 6, 2003 /s/ Salvador L. Diesi, Sr. ---------------------- ----------------------------------- DATE Salvador L. Diesi, Sr. Chairman of the Board and President November 6, 2003 /s/ Ronald J. Lashute ---------------------- ---------------------------------- DATE Ronald J. Lashute Secretary and Treasurer INDEX TO EXHIBITS

AMERICAN BANCORP INC/LA 10-Q