x
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
¨
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
IOWA
|
42-1039071
|
(State
or Other Jurisdiction of Incorporation or Organization)
|
(I.
R. S. Employer Identification
Number)
|
Large
accelerated filer ¨
|
Accelerated
filer x
|
Non-accelerated
filer ¨
|
Smaller
reporting company ¨
|
COMMON
STOCK, $2.00 PAR VALUE
|
9,432,915
|
(Class)
|
(Shares
Outstanding at August 1, 2008)
|
Page
|
|||||
PART
I.
|
FINANCIAL
INFORMATION
|
||||
Item
1.
|
Consolidated
Financial Statements (Unaudited)
|
3
|
|||
3
|
|||||
4
|
|||||
5
|
|||||
6
|
|||||
Item
2.
|
8
|
||||
Item
3.
|
23
|
||||
Item
4.
|
23
|
||||
PART
II.
|
OTHER
INFORMATION
|
||||
24
|
|||||
25
|
ASSETS
|
June
30, 2008
|
December
31, 2007
|
||||||
Cash
and due from banks
|
$ | 22,902,276 | $ | 26,044,577 | ||||
Federal
funds sold
|
15,400,000 | 5,500,000 | ||||||
Interest
bearing deposits in financial institutions
|
6,138,140 | 634,613 | ||||||
Securities
available-for-sale
|
342,882,987 | 339,942,064 | ||||||
Loans
receivable, net
|
457,513,612 | 463,651,000 | ||||||
Loans
held for sale
|
2,202,265 | 344,970 | ||||||
Bank
premises and equipment, net
|
12,987,331 | 13,446,865 | ||||||
Accrued
income receivable
|
6,669,250 | 8,022,900 | ||||||
Deferred
income taxes
|
3,243,733 | 929,326 | ||||||
Other
assets
|
2,410,024 | 3,074,833 | ||||||
Total
assets
|
$ | 872,349,618 | $ | 861,591,148 | ||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
LIABILITIES
|
||||||||
Deposits
|
||||||||
Demand,
noninterest bearing
|
$ | 81,306,466 | $ | 80,638,995 | ||||
NOW
accounts
|
169,262,133 | 160,672,326 | ||||||
Savings
and money market
|
162,606,100 | 162,291,544 | ||||||
Time,
$100,000 and over
|
97,770,417 | 109,189,660 | ||||||
Other
time
|
168,081,658 | 177,326,270 | ||||||
Total
deposits
|
679,026,774 | 690,118,795 | ||||||
Federal
funds purchased and securities sold under agreements to
repurchase
|
39,374,666 | 30,033,321 | ||||||
Other
short-term borrowings
|
685,072 | 737,420 | ||||||
Long-term
borrowings
|
39,500,000 | 24,000,000 | ||||||
Dividend
payable
|
2,641,216 | 2,545,987 | ||||||
Accrued
expenses and other liabilities
|
4,219,903 | 4,135,102 | ||||||
Total
liabilities
|
765,447,631 | 751,570,625 | ||||||
STOCKHOLDERS'
EQUITY
|
||||||||
Common
stock, $2 par value, authorized 18,000,000 shares; 9,432,915 and 9,429,580
shares issued and outstanding at June 30, 2008 and December 31, 2007,
respectively
|
18,865,830 | 18,859,160 | ||||||
Additional
paid-in capital
|
22,651,222 | 22,588,691 | ||||||
Retained
earnings
|
66,169,346 | 66,683,016 | ||||||
Accumulated
other comprehensive income (loss)-net unrealized gain (loss) on securities
available-for-sale
|
(784,411 | ) | 1,889,656 | |||||
Total
stockholders' equity
|
106,901,987 | 110,020,523 | ||||||
Total
liabilities and stockholders' equity
|
$ | 872,349,618 | $ | 861,591,148 |
Three
Months Ended
June
30,
|
Six
Months Ended
June
30,
|
|||||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
Interest
and dividend income:
|
||||||||||||||||
Loans
|
$ | 7,331,295 | $ | 7,864,594 | $ | 15,149,526 | $ | 15,437,801 | ||||||||
Securities
|
||||||||||||||||
Taxable
|
2,480,918 | 2,322,316 | 4,990,127 | 4,659,405 | ||||||||||||
Tax-exempt
|
1,261,287 | 1,189,988 | 2,608,128 | 2,384,314 | ||||||||||||
Federal
funds sold
|
90,962 | 149,213 | 134,449 | 179,390 | ||||||||||||
Dividends
|
373,243 | 383,982 | 669,737 | 774,550 | ||||||||||||
Total
interest income
|
11,537,705 | 11,910,093 | 23,551,967 | 23,435,460 | ||||||||||||
Interest
expense:
|
||||||||||||||||
Deposits
|
3,647,078 | 5,483,677 | 8,074,644 | 10,808,882 | ||||||||||||
Other
borrowed funds
|
533,972 | 522,757 | 1,129,599 | 1,014,917 | ||||||||||||
Total
interest expense
|
4,181,050 | 6,006,434 | 9,204,243 | 11,823,799 | ||||||||||||
Net
interest income
|
7,356,655 | 5,903,659 | 14,347,724 | 11,611,661 | ||||||||||||
Provision
for loan losses
|
818,995 | 143,877 | 928,694 | 153,605 | ||||||||||||
Net
interest income after provision for loan losses
|
6,537,660 | 5,759,782 | 13,419,030 | 11,458,056 | ||||||||||||
Non-interest
income:
|
||||||||||||||||
Trust
department income
|
393,886 | 721,320 | 831,153 | 1,104,665 | ||||||||||||
Service
fees
|
451,594 | 474,593 | 880,932 | 903,207 | ||||||||||||
Securities
gains (losses), net
|
(1,435,019 | ) | 452,554 | (1,413,649 | ) | 906,077 | ||||||||||
Gain
on sale of loans held for sale
|
200,246 | 195,004 | 386,539 | 298,105 | ||||||||||||
Merchant
and ATM fees
|
160,782 | 144,611 | 314,002 | 282,285 | ||||||||||||
Other
|
212,176 | 142,783 | 376,902 | 284,661 | ||||||||||||
Total
non-interest income (loss)
|
(16,335 | ) | 2,130,865 | 1,375,879 | 3,778,999 | |||||||||||
Non-interest
expense:
|
||||||||||||||||
Salaries
and employee benefits
|
2,501,007 | 2,563,314 | 5,080,915 | 5,063,267 | ||||||||||||
Data
processing
|
624,485 | 557,915 | 1,170,360 | 1,108,357 | ||||||||||||
Occupancy
expenses
|
377,965 | 300,084 | 806,066 | 621,488 | ||||||||||||
Other
operating expenses
|
763,770 | 731,223 | 1,468,580 | 1,434,372 | ||||||||||||
Total
non-in expense
|
4,267,227 | 4,152,536 | 8,525,921 | 8,227,484 | ||||||||||||
Income
before income taxes
|
2,254,098 | 3,738,111 | 6,268,988 | 7,009,571 | ||||||||||||
Income
tax expense
|
386,897 | 910,680 | 1,501,159 | 1,661,126 | ||||||||||||
Net
income
|
$ | 1,867,201 | $ | 2,827,431 | $ | 4,767,829 | $ | 5,348,445 | ||||||||
Basic
and diluted earnings per share
|
$ | 0.20 | $ | 0.30 | $ | 0.51 | $ | 0.57 | ||||||||
Declared
dividends per share
|
$ | 0.28 | $ | 0.27 | $ | 0.56 | $ | 0.54 | ||||||||
Comprehensive income (loss) | $ | (3,028,334 | ) | $ | 668,961 | $ | 2,093,895 | $ | 2,799,602 |
Six
Months Ended
June
30,
|
||||||||
2008
|
2007
|
|||||||
CASH
FLOWS FROM OPERATING ACTIVITIES
|
||||||||
Net
income
|
$ | 4,767,829 | $ | 5,348,445 | ||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||
Provision
for loan losses
|
928,694 | 153,605 | ||||||
Amortization
and accretion
|
(128,599 | ) | (97,359 | ) | ||||
Depreciation
|
581,737 | 495,565 | ||||||
Provision
for deferred taxes
|
(743,925 | ) | 5,264 | |||||
Securities
losses (gains), net
|
1,413,649 | (906,077 | ) | |||||
Change
in assets and liabilities:
|
||||||||
Increase
in loans held for sale
|
(1,857,295 | ) | (1,568,328 | ) | ||||
Decrease
in accrued income receivable
|
1,353,650 | 159,227 | ||||||
Decrease
(increase) in other assets
|
664,809 | (116,251 | ) | |||||
Increase
in accrued expenses and other liabilities
|
84,801 | 327,667 | ||||||
Net
cash provided by operating activities
|
7,065,350 | 3,801,758 | ||||||
CASH
FLOWS FROM INVESTING ACTIVITIES
|
||||||||
Purchase
of securities available-for-sale
|
(113,479,346 | ) | (37,789,276 | ) | ||||
Proceeds
from sale of securities available-for-sale
|
49,909,764 | 4,383,029 | ||||||
Proceeds
from maturities and calls of securities available-for-sale
|
55,099,059 | 32,789,825 | ||||||
Net
decrease (increase) in interest bearing deposits in financial
institutions
|
(5,503,527 | ) | 533,783 | |||||
Net
decrease (increase) in federal funds sold
|
(9,900,000 | ) | 13,100,000 | |||||
Net
decrease (increase) in loans
|
5,208,694 | (12,351,126 | ) | |||||
Purchase
of bank premises and equipment
|
(122,203 | ) | (1,639,741 | ) | ||||
Net
cash used in investing activities
|
(18,787,559 | ) | (973,506 | ) | ||||
CASH
FLOWS FROM FINANCING ACTIVITIES
|
||||||||
Decrease
in deposits
|
(11,092,021 | ) | (9,700,752 | ) | ||||
Increase
in federal funds purchased and securities sold under agreements to
repurchase
|
9,341,345 | 14,697,862 | ||||||
Increase
(decrease) in other borrowings, net
|
15,447,652 | (183,346 | ) | |||||
Dividends
paid
|
(5,186,269 | ) | (4,995,257 | ) | ||||
Proceeds
from issuance of common stock
|
69,201 | 98,921 | ||||||
Net
cash provided by (used in) financing activities
|
8,579,908 | (82,572 | ) | |||||
Net
increase (decrease) in cash and cash equivalents
|
(3,142,301 | ) | 2,745,680 | |||||
CASH
AND DUE FROM BANKS
|
||||||||
Beginning
|
26,044,577 | 16,510,082 | ||||||
Ending
|
$ | 22,902,276 | $ | 19,255,762 | ||||
Cash
payments for:
|
||||||||
Interest
|
$ | 8,502,724 | $ | 12,207,048 | ||||
Income
taxes
|
2,393,024 | 1,567,209 |
1.
|
Significant
Accounting Policies
|
2.
|
Dividends
|
3.
|
Earnings
Per Share
|
4.
|
Off-Balance
Sheet Arrangements
|
5.
|
Fair
Value Measurements
|
Description
|
Total
|
Quoted
Prices in
Active
Markets for
Identical
Assets
(Level 1)
|
Significant
Other
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||||||
Assets:
|
||||||||||||||||
Securities
available for sale
|
$ | 342,883,000 | $ | 82,749,000 | $ | 260,134,000 | $ | - |
Description
|
Total
|
Quoted
Prices in
Active
Markets for
Identical
Assets
(Level 1)
|
Significant
Other
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||||||
Assets:
|
||||||||||||||||
Loans
|
$ | 14,010,000 | $ | - | $ | - | $ | 14,010,000 |
6.
|
Investment
Securities Impairment
|
7.
|
Recent
Accounting Pronouncements
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
|
·
|
Challenges
|
|
·
|
Key
Performance Indicators and Industry
Results
|
|
·
|
Income
Statement Review
|
|
·
|
Balance
Sheet Review
|
|
·
|
Asset
Quality and Credit Risk Management
|
|
·
|
Liquidity
and Capital Resources
|
|
·
|
Forward-Looking
Statements and Business Risks
|
|
·
|
The
Company and affiliate banks have invested in FHLMC and FNMA preferred
stock and other corporate bond issues whose financial condition may
further deteriorate requiring additional impairment
charges. Additional impairment charges may be necessary on
investment securities in future periods if financial and economic
conditions do not improve as perceived by bond and equity
investors.
|
|
·
|
Banks
have historically earned higher levels of net interest income by investing
in longer term loans and securities at higher yields and paying lower
deposit expense rates on shorter maturity deposits. However,
the difference between the yields on short term and long term investments
was very low for much of 2006 and 2007, making it more difficult to manage
net interest margins. While this difference in long term and
short term yields improved in 2008, if this difference was to narrow or
invert during the remainder of 2008, the Company’s net interest margin may
compress and net interest income may be negatively
impacted. Historically, management has been able to position
the Company’s assets and liabilities to earn a satisfactory net interest
margin during periods when the yield curve is flat or inverted by
appropriately managing credit spreads on loans and maintaining adequate
liquidity to provide flexibility in an effort to hold down funding
costs. Management would seek to follow a similar approach in
dealing with this challenge for the remainder of
2008.
|
|
·
|
Yields
on U.S. Treasury securities with maturities of 2 to 5 years increased on
average 100 basis points as of June 30, 2008 compared March 31,
2008. Increasing market interest rates may present a challenge
to the Company if they were to rise significantly in a short period of
time. Increases in interest rates may negatively impact the
Company’s net interest margin if interest expense increases more quickly
than interest income. The Company’s earning assets (primarily
its loan and investment portfolio) have longer maturities than its
interest bearing liabilities (primarily deposits and other borrowings);
therefore, in a rising interest rate environment, interest expense will
increase more quickly than interest income as the interest bearing
liabilities reprice more quickly than earning assets. In
response to this challenge, the Banks model quarterly the changes in
income that would result from various changes in interest
rates. Management believes Bank earning assets have the
appropriate maturity and repricing characteristics to optimize earnings
and the Banks’ interest rate risk
positions.
|
|
·
|
The
Company’s market in central Iowa has numerous banks, credit unions, and
investment and insurance companies competing for similar business
opportunities. This competitive environment will continue to
put downward pressure on the Banks’ net interest margins and thus affect
profitability. Strategic planning efforts at the Company and
Banks continue to focus on capitalizing on the Banks’ strengths in local
markets while working to identify opportunities for improvement to gain
competitive advantages.
|
|
·
|
A
substandard performance in the Company’s equity portfolio could lead to a
reduction in the historical level of realized security gains, thereby
negatively impacting the Company’s earnings. The Company
invests capital that may be utilized for future expansion in a portfolio
of primarily financial stocks with an estimated fair market value of
approximately $15 million as of June 30, 2008. The Company
focuses on stocks that have historically paid dividends in an effort to
lessen the negative effects of a bear
market.
|
|
·
|
The
economic conditions for commercial real estate developers in the Des
Moines metropolitan area deteriorated in 2007 and the first half of
2008. This deterioration has contributed to the Company’s
increased level of non-performing loans. Presently, the Company
has $11.8 million in impaired loans with four Des Moines development
companies with specific reserves totaling $207,000. The Company
has additional credit relationships with real estate developers in the Des
Moines area that presently, have collateral values sufficient to cover
loan balances. However, the loans may become impaired in the
future if economic conditions do not improve or become
worse. As of June 30, 2008, the Company has a limited number of
such credits and is actively engaged with the customers to minimize credit
risks.
|
June
30, 2008
|
March
31, 2008
|
Years
Ended December 31,
|
||||||||||||||||||||||||||||||
3
Months
Ended
|
6
Months
Ended
|
3
Months
Ended
|
2007
|
2006
|
||||||||||||||||||||||||||||
Company
|
Company
|
Company
|
Industry*
|
Company
|
Industry
|
Company
|
Industry
|
|||||||||||||||||||||||||
Return
on assets
|
0.85 | % | 1.09 | % | 1.33 | % | 0.59 | % | 1.30 | % | 0.86 | % | 1.34 | % | 1.28 | % | ||||||||||||||||
Return
on equity
|
6.70 | % | 8.54 | % | 10.38 | % | 5.72 | % | 9.89 | % | 8.17 | % | 9.99 | % | 12.34 | % | ||||||||||||||||
Net
interest margin
|
3.91 | % | 3.85 | % | 3.78 | % | 3.33 | % | 3.39 | % | 3.29 | % | 3.29 | % | 3.31 | % | ||||||||||||||||
Efficiency
ratio
|
58.13 | % | 54.22 | % | 50.80 | % | 56.73 | % | 53.71 | % | 59.37 | % | 52.27 | % | 56.79 | % | ||||||||||||||||
Capital
ratio
|
12.71 | % | 12.78 | 12.85 | % | 7.87 | % | 13.20 | % | 7.98 | % | 13.38 | % | 8.23 | % |
|
·
|
Return
on Assets
|
|
·
|
Return
on Equity
|
|
·
|
Net
Interest Margin
|
|
·
|
Efficiency
Ratio
|
|
·
|
Capital
Ratio
|
AVERAGE
BALANCE SHEETS AND INTEREST RATES
|
||||||||||||||||||||||||
Three
Months Ended June 30,
|
||||||||||||||||||||||||
2008
|
2007
|
|||||||||||||||||||||||
Average
balance
|
Revenue/
expense
|
Yield/
rate
|
Average
balance
|
Revenue/
expense
|
Yield/
rate
|
|||||||||||||||||||
ASSETS
|
||||||||||||||||||||||||
(dollars
in thousands)
|
||||||||||||||||||||||||
Interest-earning
assets
|
||||||||||||||||||||||||
Loans 1
|
||||||||||||||||||||||||
Commercial
|
$ | 85,853 | $ | 1,222 | 5.69 | % | $ | 77,252 | $ | 1,542 | 7.98 | % | ||||||||||||
Agricultural
|
30,377 | 520 | 6.85 | % | 32,645 | 699 | 8.56 | % | ||||||||||||||||
Real
estate
|
328,767 | 5,219 | 6.35 | % | 317,904 | 5,273 | 6.63 | % | ||||||||||||||||
Installment
and other
|
24,297 | 370 | 6.09 | % | 22,788 | 351 | 6.16 | % | ||||||||||||||||
Total
loans (including fees)
|
$ | 469,294 | $ | 7,331 | 6.25 | % | $ | 450,589 | $ | 7,865 | 6.98 | % | ||||||||||||
Investment
securities
|
||||||||||||||||||||||||
Taxable
|
$ | 202,765 | $ | 2,565 | 5.06 | % | $ | 208,443 | $ | 2,445 | 4.69 | % | ||||||||||||
Tax-exempt 2
|
139,453 | 2,307 | 6.62 | % | 135,463 | 2,215 | 6.54 | % | ||||||||||||||||
Total
investment securities
|
$ | 342,218 | $ | 4,873 | 5.70 | % | $ | 343,906 | $ | 4,660 | 5.42 | % | ||||||||||||
Interest
bearing deposits with banks
|
$ | 6,395 | $ | 51 | 3.19 | % | $ | 1,016 | $ | 11 | 4.33 | % | ||||||||||||
Federal
funds sold
|
17,735 | 91 | 2.05 | % | 11,152 | 149 | 5.34 | % | ||||||||||||||||
Total
interest-earning assets
|
$ | 835,642 | $ | 12,346 | 5.91 | % | $ | 806,663 | $ | 12,685 | 6.29 | % | ||||||||||||
Non-interest-earning
assets
|
41,190 | 43,022 | ||||||||||||||||||||||
TOTAL
ASSETS
|
$ | 876,832 | $ | 849,685 |
AVERAGE
BALANCE SHEETS AND INTEREST RATES
|
||||||||||||||||||||||||
Three
Months Ended June 30,
|
||||||||||||||||||||||||
2008
|
2007
|
|||||||||||||||||||||||
Average
balance
|
Revenue/
expense
|
Yield/
rate
|
Average
balance
|
Revenue/
expense
|
Yield/
rate
|
|||||||||||||||||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||||||||||||||||||
(dollars
in thousands)
|
||||||||||||||||||||||||
Interest-bearing
liabilities
|
||||||||||||||||||||||||
Deposits
|
||||||||||||||||||||||||
Savings,
NOW accounts, and money markets
|
$ | 328,858 | $ | 860 | 1.04 | % | $ | 328,199 | $ | 2,212 | 2.70 | % | ||||||||||||
Time
deposits < $100,000
|
171,752 | 1,720 | 4.01 | % | 179,789 | 1,986 | 4.42 | % | ||||||||||||||||
Time
deposits > $100,000
|
102,319 | 1,067 | 4.17 | % | 103,867 | 1,285 | 4.95 | % | ||||||||||||||||
Total
deposits
|
$ | 602,929 | $ | 3,647 | 2.42 | % | $ | 611,855 | $ | 5,483 | 3.58 | % | ||||||||||||
Other
borrowed funds
|
78,630 | 534 | 2.72 | % | 47,568 | 523 | 4.40 | % | ||||||||||||||||
Total
interest-bearing liabilities
|
$ | 681,559 | $ | 4,181 | 2.45 | % | $ | 659,423 | $ | 6,006 | 3.64 | % | ||||||||||||
Non-interest-bearing
liabilities
|
||||||||||||||||||||||||
Demand
deposits
|
$ | 75,967 | $ | 70,209 | ||||||||||||||||||||
Other
liabilities
|
7,861 | 7,994 | ||||||||||||||||||||||
Stockholders'
equity
|
$ | 111,445 | $ | 112,109 | ||||||||||||||||||||
TOTAL
LIABILITIES AND
|
||||||||||||||||||||||||
STOCKHOLDERS'
EQUITY
|
$ | 876,832 | $ | 849,685 | ||||||||||||||||||||
Net
interest: income / margin
|
$ | 8,165 | 3.91 | % | $ | 6,679 | 3.31 | % | ||||||||||||||||
Spread
Analysis
|
||||||||||||||||||||||||
Interest
income/average assets
|
$ | 12,346 | 5.63 | % | $ | 12,685 | 5.97 | % | ||||||||||||||||
Interest
expense/average assets
|
$ | 4,181 | 1.91 | % | $ | 6,006 | 2.83 | % | ||||||||||||||||
Net
interest income/average assets
|
$ | 8,165 | 3.73 | % | $ | 6,679 | 3.14 | % |
ASSETS
|
||||||||||||||||||||||||
(dollars
in thousands)
|
||||||||||||||||||||||||
AVERAGE
BALANCE SHEETS AND INTEREST RATES
|
||||||||||||||||||||||||
Six
Months Ended June 30,
|
||||||||||||||||||||||||
2008
|
2007
|
|||||||||||||||||||||||
Average
balance
|
Revenue/
expense
|
Yield/
rate
|
Average
balance
|
Revenue/
expense
|
Yield/
rate
|
|||||||||||||||||||
Loans
1
|
||||||||||||||||||||||||
Commercial
|
$ | 82,791 | $ | 2,588 | 6.25 | % | $ | 76,715 | $ | 3,057 | 7.97 | % | ||||||||||||
Agricultural
|
31,597 | 1,135 | 7.18 | % | 32,184 | 1,359 | 8.45 | % | ||||||||||||||||
Real
estate
|
330,725 | 10,696 | 6.47 | % | 313,738 | 10,313 | 6.57 | % | ||||||||||||||||
Installment
and other
|
24,098 | 731 | 6.07 | % | 23,139 | 709 | 6.13 | % | ||||||||||||||||
Total
loans (including fees)
|
$ | 469,211 | $ | 15,150 | 6.46 | % | $ | 445,776 | $ | 15,438 | 6.93 | % | ||||||||||||
Investment
securities
|
||||||||||||||||||||||||
Taxable
|
$ | 203,860 | $ | 5,168 | 5.07 | % | $ | 210,646 | $ | 4,906 | 4.66 | % | ||||||||||||
Tax-exempt
2
|
142,091 | 4,665 | 6.57 | % | 135,986 | 4,440 | 6.53 | % | ||||||||||||||||
Total
investment securities
|
$ | 345,951 | $ | 9,833 | 5.68 | % | $ | 346,632 | $ | 9,346 | 5.39 | % | ||||||||||||
Interest
bearing deposits with banks
|
$ | 3,943 | $ | 68 | 3.45 | % | $ | 2,225 | $ | 26 | 2.34 | % | ||||||||||||
Federal
funds sold
|
12,055 | 134 | 2.22 | % | 7,153 | 179 | 5.00 | % | ||||||||||||||||
Total
interest-earning assets
|
$ | 831,160 | $ | 25,185 | 6.06 | % | $ | 801,786 | $ | 24,989 | 6.23 | % | ||||||||||||
Total
noninterest-earning assets
|
$ | 42,274 | $ | 42,408 | ||||||||||||||||||||
TOTAL
ASSETS
|
$ | 873,434 | $ | 844,194 |
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||||||||||||||||||
(dollars
in thousands)
|
||||||||||||||||||||||||
AVERAGE
BALANCE SHEETS AND INTEREST RATES
|
||||||||||||||||||||||||
Six
Months Ended June 30,
|
||||||||||||||||||||||||
2008
|
2007
|
|||||||||||||||||||||||
Average
balance
|
Revenue/
expense
|
Yield/
rate
|
Average
balance
|
Revenue/
expense
|
Yield/
rate
|
|||||||||||||||||||
Interest-bearing
liabilities
|
||||||||||||||||||||||||
Deposits
|
||||||||||||||||||||||||
Savings,
NOW accounts, and money markets
|
$ | 322,303 | $ | 2,080 | 1.29 | % | $ | 323,391 | $ | 4,317 | 2.67 | % | ||||||||||||
Time
deposits < $100,000
|
174,490 | 3,652 | 4.19 | % | 180,942 | 3,930 | 4.34 | % | ||||||||||||||||
Time
deposits > $100,000
|
106,334 | 2,343 | 4.41 | % | 104,576 | 2,562 | 4.90 | % | ||||||||||||||||
Total
deposits
|
$ | 603,127 | $ | 8,075 | 2.68 | % | $ | 608,909 | $ | 10,809 | 3.55 | % | ||||||||||||
Other
borrowed funds
|
73,704 | 1,129 | 3.06 | % | 45,747 | 1,015 | 4.44 | % | ||||||||||||||||
Total
interest-bearing
|
$ | 676,831 | $ | 9,204 | 2.72 | % | $ | 654,656 | $ | 11,824 | 3.61 | % | ||||||||||||
Noninterest-bearing
liabilities
|
||||||||||||||||||||||||
Demand
deposits
|
$ | 75,972 | $ | 69,494 | ||||||||||||||||||||
Other
liabilities
|
8,999 | 8,007 | ||||||||||||||||||||||
Stockholders'
equity
|
$ | 111,632 | $ | 112,091 | ||||||||||||||||||||
TOTAL
LIABILITIES AND
|
||||||||||||||||||||||||
STOCKHOLDERS'
EQUITY
|
$ | 873,434 | $ | 844,194 | ||||||||||||||||||||
Net
interest income / margin
|
$ | 15,981 | 3.85 | % | $ | 13,165 | 3.28 | % | ||||||||||||||||
Spread
Analysis
|
||||||||||||||||||||||||
Interest
income/average assets
|
$ | 25,185 | 5.77 | % | $ | 24,989 | 5.92 | % | ||||||||||||||||
Interest
expense/average assets
|
9,204 | 2.11 | % | 11,824 | 2.80 | % | ||||||||||||||||||
Net
interest income/average assets
|
15,981 | 3.66 | % | 13,165 | 3.12 | % |
|
·
|
Review
the Company’s Current Liquidity
Sources
|
|
·
|
Review
of the Statements of Cash Flows
|
|
·
|
Company
Only Cash Flows
|
|
·
|
Review
of Commitments for Capital Expenditures, Cash Flow Uncertainties and Known
Trends in Liquidity and Cash Flows
Needs
|
|
·
|
Capital
Resources
|
Quantitative
and Qualitative Disclosures About Market
Risk
|
Controls
and Procedures
|
PART
II.
|
OTHER
INFORMATION
|
Legal
Proceedings
|
Item
1.a.
|
Risk
Factors
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of
Proceeds
|
Item
3.
|
Defaults
Upon Senior Securities
|
Item
4.
|
Submission
of Matters to a Vote of Security
Holders
|
Votes
|
|||||||||
In Favor
|
Withheld
|
||||||||
Betty
A Baudler Horras
|
8,178,266 | 238,182 | |||||||
Douglas
C. Gustafson, DVM
|
8,170,223 | 246,225 | |||||||
Charles
D. Jons, MD
|
8,180,658 | 235,790 | |||||||
Thomas
H. Pohlman
|
8,180,658 | 235,790 |
Item
5.
|
Other
Information
|
Item
6.
|
Exhibits
|
|
(a)
|
Exhibits
|
Certification
of Principal Executive Officer Pursuant to Section 302 of Sarbanes-Oxley
Act of 2002.
|
||
Certification
of Principal Financial Officer Pursuant to Section 302 of Sarbanes-Oxley
Act of 2002.
|
||
Certification
of Principal Executive Officer Pursuant to 18 U.S.C. Section
1350.
|
||
Certification
of Principal Financial Officer Pursuant to 18 U.S.C. Section
1350.
|
AMES
NATIONAL CORPORATION
|
||
DATE:
August 8, 2008
|
By:
|
/s/
Thomas H. Pohlman
|
Thomas
H. Pohlman, President
|
||
Principal
Executive Officer
|
||
By:
|
/s/
John P. Nelson
|
|
John
P. Nelson, Vice President
|
||
Principal
Financial Officer
|