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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from _____________ to ____________
Commission File No. 0-11487
LAKELAND FINANCIAL CORPORATION
(exact name of registrant as specified in its charter)
INDIANA 35-1559596
(State or other jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or organization)
202 East Center Street, P.O. Box 1387, Warsaw, Indiana 46581-1387
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 1-219-267-6144
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
None None
Securities registered pursuant to Section 12(g) of the Act:
COMMON
(Title of Class)
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 other 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 if disclosure of delinquent filers pursuant to
Item 405 of regulation S-K is not contained herein and will not be contained,
to the best of the Registrant's knowledge, in definitive Proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.[ ]
Aggregate market value of the voting stock held by non-affiliates of the
registrant, computed solely for the purposes of this requirement on the basis
of the book value at February 29, 1996, and assuming solely for the purposes
of this calculation that all Directors and executive officers of the
Registrant are "affiliates": $35,131,538.
Number of shares of common stock outstanding at February 29, 1996:
1,448,496.
Cover page 1 of 2 pages
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the following documents are incorporated by reference in the Part
of 10-K indicated:
Part Document
I, II & IV Lakeland Financial Corporation's Annual Report to
Shareholders for year ended December 31, 1995,
parts of which are incorporated into Parts I, II
and IV of this Form 10-K.
III Proxy statement mailed to Shareholders on March
11, 1996, which is incorporated into Part III
of this Form 10-K.
Cover page 2 of 2 pages
PART I.
ITEM 1. BUSINESS
The registrant was incorporated under the laws of the State of Indiana on
February 8, 1983. As used herein, the term "Registrant" refers to Lakeland
Financial Corporation or, if the context dictates, the Lakeland Financial
Corporation and its wholly owned subsidiary, Lake City Bank, Warsaw, Indiana.
GENERAL
REGISTRANT'S BUSINESS. The Registrant is a bank holding company as
defined in the Bank Holding Company Act of 1956, as amended. Registrant owns
all of the outstanding stock of Lake City Bank, Warsaw, Indiana, a full
service commercial bank organized under Indiana law (the "Bank"). Registrant
conducts no business except that incident to its ownership of the outstanding
stock of the Bank and the operation of the Bank.
The Bank's deposits are insured by the Federal Deposit Insurance
Corporation. The Bank's activities cover all phases of commercial banking,
including checking accounts, savings accounts, time deposits, the sale of
securities under agreements to repurchase, discount brokerage services,
commercial and agricultural lending, direct and indirect consumer lending,
real estate mortgage lending, safe deposit box service and trust services.
The Bank's main banking office is located at 202 East Center Street,
Warsaw, Indiana. As of December 31, 1995, the Bank had nine branch offices and
one drive-up facility in Kosciusko County, seven branch offices in Elkhart
County, three branch offices in Noble County, three branch offices in Wabash
County, two branch offices in LaGrange County, two branch offices in Marshall
County, one branch office in Whitley County and two branch offices and one
drive-up facility in Fulton County. The Bank's operations center is located at
113 East Market Street, Warsaw, Indiana.
SUPERVISION AND REGULATION. The Registrant is a bank holding company
within the meaning of the Bank Holding Company Act of 1956, as amended ("BHC
Act"). As a bank holding company, the registrant is required to file with the
Federal Reserve Board (the "FRB") annual reports and such additional
information as the FRB may require. The FRB may also make an examination or
inspection of the Registrant.
The BHC Act prohibits a bank holding company from engaging in, or
acquiring direct or indirect control of more than five percent of the voting
shares of any company engaged in non-banking activities. One of the principal
exceptions to this prohibition is for activities deemed by the FRB to be
"closely related to banking". Under current regulations, bank holding
companies and their subsidiaries may engage in such bank related business
ventures as consumer finance, equipment leasing, computer service bureau and
software operations and mortgage banking.
The BHC Act also governs banking expansion by bank holding companies.
Before a bank holding company acquires more than five percent of the voting
shares of any other bank it must receive the prior written approval of the FRB
or its delegate. Furthermore, the BHC Act does not permit a bank holding
company to acquire a bank located outside the State of Indiana unless the
acquisition is specifically authorized by the laws of the State in which such
bank is located.
1
The acquisition of banking subsidiaries by bank holding companies is
subject to the jurisdiction of, and requires the prior approval of, the
Federal Reserve, and for institutions resident in Indiana, the Indiana
Department of Financial Institutions. Bank holding companies located in
Indiana are permitted to acquire banking subsidiaries throughout the state,
subject to limitations based upon the percentage of total state deposits of
the holding company's subsidiary banks. Indiana law permits the Registrant to
acquire banks, and be acquired by bank holding companies, located in any state
in the country which permits reciprocal entry by Indiana bank holding
companies.
The Registrant is an "affiliate" of the Bank within the meaning of
Section 23A of the Federal Reserve Act (as made applicable to the Bank by the
Federal Deposit Insurance Act) and Indiana Code 28-1-18.1. As a result, the
Bank is restricted in making loans to, investments in, or loans secured by
securities of, the Registrant. The BHC Act also prohibits the Registrant and
its subsidiaries from imposing "tie-in" requirements in connection with
extensions of credit and other services.
Under the provisions of Indiana law, the registrant may not acquire more
than twenty-five percent of the voting stock in any banks other than the Bank
without the approval of the Indiana Department of Financial Institutions. In
any such event, the Registrant would be required to obtain the prior approval
of the FRB as described above to purchase interest of five percent or more in
another bank.
The Bank is under supervision of and subject to examination by the
Indiana Department of Financial Institutions and the Federal Deposit Insurance
Corporation. Regulation and examination by banking regulatory agencies are
primarily for the benefit of depositors and not shareholders.
The earnings of commercial banks are affected not only by general
economic conditions, but also by the policies of various governmental
regulatory authorities. In particular, the FRB regulates money and credit
conditions and interest rates in order to influence general economic
conditions, primarily through open-market operations in U.S. Government
securities, the discount rate on bank borrowing, setting the reserves that
banks must maintain against certain bank deposits and the regulation of
interest rates payable by banks on certain time and savings deposits. These
policies have a significant effect on the overall growth and distribution of
bank loans, investments and deposits. They influence interest rates charged on
loans, earned on investments and paid for time and savings deposits. FRB
monetary policies have had significant effect on the operating results of
commercial banks in the past, and are expected to exert similar influence in
the future. The general effect, if any, of such policies upon the future
business and earnings of the Registrant and the Bank cannot be reasonably
predicted.
MATERIAL CHANGES AND BUSINESS DEVELOPMENTS
From the date of the Registrant's incorporation, February 8, 1983, until
October 31, 1983, the Registrant conducted no business and had no assets
(except nominal assets necessary to complete the acquisition of the Bank). The
Registrant has conducted no business since October 31, 1983, except that
incident to its ownership of the stock of the Bank, the collection of
dividends from the Bank, and the disbursement of dividends to the Registrant's
shareholders. During the period from 1985 to 1987, the Registrant owned all of
the outstanding shares of Lakeland Mortgage Corp., a mortgage lending and
servicing corporation doing business in Indiana. Lakeland Mortgage Corp.
discontinued business operations on December 15, 1987. The Registrant
continued to own all of the stock of Lakeland Mortgage Corp.
2
until 1992, during which year, Lakeland Mortgage Corp. was liquidated and all
stock was redeemed.
COMPETITION
The Bank was originally organized in 1872 and has continuously operated
under the laws of the State of Indiana since its organization. The Bank is a
full service bank providing both commercial and personal banking services.
Bank products offered include interest and noninterest bearing demand
accounts, savings and time deposit accounts, sale of securities under
agreements to repurchase, discount brokerage, commercial loans, mortgage
loans, consumer loans, letters of credit, and a wide range of trust services.
The interest rates for both deposits and loans, as well as the range of
services provided, are nearly the same for all banks competing within the
Bank's service area.
The Bank's service area is described as all of Kosciusko, Elkhart, and
Wabash Counties and portions of St. Joseph, Marshall, Fulton, Miami,
Huntington, Whitley, Noble, and LaGrange Counties. Within this area the Bank
competes with 22 other banks, 7 of which are larger than the Bank. Of the 15
which are smaller than the Bank, 2 are members of Bank Holding Companies which
are larger than the Registrant. Eight of these institutions have home offices
outside the Bank's defined business area but operate branches within this
area.
In addition to the banks located within its service area, the Bank also
competes with savings and loan associations, credit unions, farm credit
services, finance companies, personal loan companies, insurance companies,
money market funds, and other non-depository financial intermediaries. In
addition, financial intermediaries such as money market mutual funds and large
retailers are not subject to the same regulations and laws that govern the
operation of traditional depository institutions and accordingly may have an
advantage in competing for funds.
In addition to the banks within its service area, the Bank competes with
other major banks for the large commercial deposit and loan accounts. The Bank
is presently subject to an aggregate maximum loan limit to any single account
in the amount of $6,232,000 pursuant to Indiana law. This maximum prohibits
the Bank from providing a full range of banking services to those businesses
or personal accounts whose borrowing periodically exceed this amount. In order
to retain at least a portion of the bank business of these large borrowers,
the Bank maintains correspondent relationships with: Norwest Bank, Indiana,
N.A., Fort Wayne, Indiana; NBD, N.A., Indianapolis, Indiana; Northern Trust
Company, Chicago, Illinois; Bank One, N.A., Indianapolis, Indiana; and Mellon
Bank, N.A., Pittsburgh, Pennsylvania. The Bank also participates with local
and other banks in the placement of large borrowings in excess of its lending
limit. The Bank is also a member of the Federal Home Loan Bank of Indianapolis
in order to broaden its mortgage lending and investment activities and to
provide additional funds, if necessary, to support these activities.
FOREIGN OPERATIONS
The Bank has no investments with any foreign entity other than a nominal
demand deposit account which is maintained with a Canadian bank in order to
facilitate the clearing of checks drawn on banks located in that country.
There are no foreign loans.
3
EMPLOYEES
At December 31, 1995, the Registrant, including its subsidiary
corporation, had approximately 292 full time equivalent employees. Benefit
programs include a pension plan, 401(k) plan, group medical insurance, group
life insurance and paid vacations. The bank is not a party to any collective
bargaining agreement, and employee relations are considered good.
INDUSTRY SEGMENTS
The Registrant and the Bank are engaged in a single industry and perform
a single service -- commercial banking. On the pages that follow are tables
which set forth selected statistical information relative to the business of
the Registrant.
(Intentionally Left Blank)
4
DISTRIBUTION OF ASSETS, LIABILITIES AND STOCKHOLDERS' EQUITY;
INTEREST RATES AND INTEREST DIFFERENTIAL
(in thousands of dollars)
1995 1994
------------------------------------ -------------------------------------
Average Interest Average Interest
Balance Income Yield* Balance Income Yield*
----------- ----------- ----------- ----------- ----------- -----------
ASSETS
Earning assets:
Trading account investments $ 0 $ 0 0.00% $ 0 $ 0 0.00%
Loans:
Taxable ** 305,806 29,859 9.76 267,604 23,658 8.84
Tax Exempt * 3,435 389 11.32 3,787 413 10.91
Investments:
Taxable 170,788 10,723 6.28 149,049 8,842 5.93
Tax Exempt * 16,724 1,572 9.40 11,436 1,102 9.64
Short-term investment 3,293 192 5.83 3,551 152 4.28
Interest bearing deposits 108 10 9.26 98 3 3.06
----------- ----------- ----------- ----------- ----------- -----------
Total Earning Assets $ 500,154 $ 42,745 8.55% $ 435,525 $ 34,170 7.85%
=========== ===========
Nonearning assets:
Cash and due from banks 20,725 0 18,164 0
Premises and equipment 12,386 0 10,104 0
Other assets 7,668 0 7,508 0
Less: allowance for loan losses (5,238) 0 (4,417) 0
----------- ----------- ----------- -----------
Total assets $ 535,695 $ 42,745 $ 466,884 $ 34,170
=========== =========== =========== ===========
Tax exempt income converted to fully taxable equivalent basis at a 34 percent tax rate for 1995 and 1994. Tax equivalent rate
for tax exempt loans and tax exempt securities acquired after January 1, 1983, includes TEFRA adjustment applicable to
nondeductible interest expenses. Nonaccrual loans are included in the above analysis as earning assets - loans.
**Loan fees, which are immaterial in relation to total taxable loan interest income for the years ended December 31, 1995,
and 1994, are included as taxable loan interest income.
5
DISTRIBUTION OF ASSETS, LIABILITIES AND STOCKHOLDERS' EQUITY;
INTEREST RATES AND INTEREST DIFFERENTIAL (cont.)
(in thousands of dollars)
1994 1993
-------------------------------------- --------------------------------------
Average Interest Average Interest
Balance Income Yield* Balance Income Yield*
----------- ----------- ---------- ----------- ----------- ----------
ASSETS
Earning assets:
Trading account investments $ 0 $ 0 0.00% $ 72 $ 2 3.31%
Loans:
Taxable ** 267,604 23,658 8.84 235,352 19,946 8.47
Tax Exempt * 3,787 413 10.91 5,114 529 10.34
Investments:
Taxable 149,049 8,842 5.93 100,507 6,459 6.43
Tax Exempt * 11,436 1,102 9.610.26 9,463 971
Short-term investment 3,551 152 4.28 3,111 93 2.99
Interest bearing deposits 98 3 3.06 3,116 92 2.95
----------- ----------- ---------- ----------- ----------- ----------
Total earning assets $ 435,525 $ 34,170 7.85% $ 356,735 $ 28,092 7.87%
========== ==========
Nonearning assets:
Cash and due from banks 18,164 0 12,505 0
Premises and equipment 10,104 0 8,119 0
Other assets 7,508 0 8,308 0
Less: allowance for loan losses (4,417) 0 (3,419) 0
----------- ----------- ----------- -----------
Total assets $ 466,884 $ 34,170 $ 382,248 $ 28,092
=========== =========== =========== ===========
* Tax exempt income converted to fully taxable equivalent basis at a 34 percent tax rate for 1994 and 1993. Tax equivalent
rate for tax exempt loans and tax exempt securities acquired after January 1, 1983, includes TEFRA adjustment applicable to
nondeductible interest expenses. Nonaccrual loans are included in the above analysis as earning assets - loans.
**Loan fees, which are immaterial in relation to total taxable loan interest income for the years ended December 31, 1994,
and 1993, are included as taxable loan interest income.
6
DISTRIBUTION OF ASSETS, LIABILITIES AND STOCKHOLDERS' EQUITY;
INTEREST RATES AND INTEREST DIFFERENTIAL (cont.)
(in thousands of dollars)
1995 1994
------------------------------------- -------------------------------------
Average Interest Average Interest
Balance Expense Rate Balance Expense Rate
----------- ----------- ----------- ----------- ----------- -----------
LIABILITIES AND STOCKHOLDERS'
EQUITY
Interest bearing liabilities
Savings deposits $ 46,123 $ 1,069 2.32% $ 55,855 $ 1,517 2.72%
Interest bearing checking accounts 55,355 1,333 2.41 58,945 1,394 2.36
Time deposits
In denominations under $100,000 177,992 10,035 5.64 148,251 6,837 4.61
In denominations over $100,000 73,449 4,410 6.00 54,389 2,360 4.34
Miscellaneous short-term borrowings 66,610 3,803 5.71 47,220 1,879 3.98
Long-term borrowings 17,432 992 5.69 15,806 900 5.69
Capital notes 0 0 0.00 0 0 0.00
----------- ----------- ----------- ----------- ----------- -----------
Total interest bearing liabilities $ 436,961 $ 21,642 4.95% $ 380,466 $ 14,887 3.91%
=========== ===========
Non-interest bearing liabilities
and stockholders' equity
Demand deposits 60,753 0 52,893 0
Other liabilities 4,897 0 4,606 0
Stockholders' equity 33,084 0 28,919 0
----------- ----------- ----------- -----------
Total liabilities and stock-
holders' equity $ 535,695 $ 21,642 4.04% $ 466,884 $ 14,887 3.19%
=========== =========== =========== =========== =========== ===========
Net interest differential - yield on average
daily earning assets $ 21,103 4.22% $ 19,283 4.43%
=========== =========== =========== ===========
7
DISTRIBUTION OF ASSETS, LIABILITIES AND STOCKHOLDERS' EQUITY;
INTEREST RATES AND INTEREST DIFFERENTIAL (cont.)
(in thousands of dollars)
1994 1993
------------------------------------- -------------------------------------
Average Interest Average Interest
Balance Expense Rate Balance Expense Rate
----------- ----------- ----------- ----------- ----------- -----------
LIABILITIES AND STOCK-
HOLDERS' EQUITY
Interest bearing liabilities
Savings deposits $ 55,855 $ 1,517 2.72% $ 38,263 $ 1,059 2.77%
Interest bearing checking accounts 58,945 1,394 2.36 54,197 1,380 2.55
Time deposits
In denominations under $100,000 148,251 6,837 4.61 128,520 6,074 4.73
In denominations over $100,000 54,389 2,360 4.34 42,458 1,588 3.74
Miscellaneous short-term borrowings 47,220 1,879 3.98 42,919 1,428 3.33
Long-term borrowings 15,806 900 5.69 8,677 493 5.68
Capital notes 0 0 0.00 0 0 0.00
----------- ----------- ----------- ----------- ----------- -----------
Total interest bearing liabilities $ 380,466 $ 14,887 3.91% $ 315,034 $ 12,022 3.82%
=========== ===========
Non-interest bearing liabilities
and stockholders' equity
Demand deposits 52,893 0 37,709 0
Other liabilities 4,606 0 3,847 0
Stockholders' equity 28,919 0 25,658 0
----------- ----------- ----------- -----------
Total liabilities and stock-
holders' equity $ 466,884 $ 14,887 3.19% $ 382,248 $ 12,022 3.15%
=========== =========== =========== =========== =========== ==========
Net interest differential - yield on
average daily earning assets $ 19,283 4.43% $ 16,070 4.50%
=========== =========== =========== ==========
8
ANALYSIS OF CHANGES IN INTEREST DIFFERENTIALS
(Fully Taxable Equivalent Basis)
(in thousands of dollars)
YEAR ENDED DECEMBER 31,
1995 Over (under) 1994(1) 1994 Over (under) 1993(1)
------------------------------------- -------------------------------------
Volume Rate Total Volume Rate Total
----------- ----------- ----------- ----------- ----------- -----------
INTEREST AND LOAN FEE INCOME(2)
Loans:
Taxable $ 3,581 $ 2,620 $ 6,201 $ 2,823 $ 889 $ 3,712
Tax exempt (39) 15 (24) (143) 27 (116)
Investments:
Taxable 1,344 537 1,881 2,912 (529) 2,383
Tax exempt 496 (26) 470 193 (61) 132
Trading account investments 0 0 0 (1) (1) (2)
Short-term investment (12) 52 40 14 45 59
Interest bearing deposits 0 7 7 (100) 10 (90)
----------- ----------- ----------- ----------- ----------- -----------
Total interest income 5,370 3,205 8,575 5,698 380 6,078
----------- ----------- ----------- ----------- ----------- -----------
INTEREST EXPENSE
Savings deposits (243) (205) (448) 478 (20) 458
Interest bearing checking accounts (86) 25 (61) 116 (102) 14
Time deposits
In denominations under $100,000 1,517 1,681 3,198 914 (150) 764
In denominations over $100,000 979 1,071 2,050 492 280 772
Miscellaneous short-term borrowings 935 989 1,924 152 298 450
Long-term borrowings 93 (1) 92 406 1 407
----------- ----------- ----------- ----------- ----------- -----------
Total interest expense 3,195 3,560 6,755 2,558 307 2,865
----------- ----------- ----------- ----------- ----------- -----------
INCREASE (DECREASE) IN
INTEREST DIFFERENTIALS $ 2,175 $ (355) $ 1,820 $ 3,140 $ 73 $ 3,213
=========== =========== =========== =========== =========== ===========
(1) The earning assets and interest bearing liabilities used to calculate interest differentials are based on average daily
balances for 1995, 1994 and 1993. The changes in volume represent "changes in volume times the old rate". The changes in rate
represent "changes in rate times old volume". The change in rate/volume were also calculated by "change in rate times change
in volume" and allocated consistently based upon the relative absolute values of the changes in volume and changes in rate.
(2) Tax exempt income converted to fully taxable equivalent basis at a 34 percent tax rate for 1995, 1994 and 1993. Tax
equivalent rate for tax exempt loans and tax exempt securities acquired after January 1, 1983, includes TEFRA adjustment
applicable to nondeductible interest expense.
9
ANALYSIS OF SECURITIES
(in thousands of dollars)
The amortized cost and the fair value of securities as of December 31, 1995, 1994 and 1993 are as follows:
1995 1994 1993
------------------------ ------------------------ ------------------------
Amortized Fair Amortized Fair Amortized Fair
Cost Value Cost Value Cost Value
----------- ----------- ----------- ----------- ----------- -----------
Securities available-for-sale:
U.S. Treasury securities $ 27,549 $ 27,844 $ 26,960 $ 25,916 $ 29,701 $ 30,446
Government agencies and corporations 2,150 2,191 1,000 1,000 0 0
Mortgage-backed securities 48,302 48,843 30,734 28,987 26,798 26,810
Obligations of state and political
subdivisions 2,076 2,176 887 933 882 975
Other securities 999 1,066 999 1,026 999 1,128
----------- ----------- ----------- ----------- ----------- -----------
Total debt securities available-for-sale 81,076 82,120 60,580 57,862 58,380 59,359
=========== =========== =========== =========== =========== ===========
Securities held-to-maturity:
U.S. Treasury securities $ 13,611 $ 13,576 $ 14,714 $ 13,876 $ 10,544 $ 10,559
Government agencies and corporations 2,898 3,033 2,034 2,037 99 99
Mortgage-backed securities 77,319 77,471 78,781 73,673 77,085 77,067
Obligations of state and political
subdivisions 19,047 20,077 13,608 13,061 10,825 11,457
Other securities 1,013 1,171 1,015 1,076 1,017 1,195
----------- ----------- ----------- ----------- ----------- -----------
Total debt securities held-to-maturity 113,888 115,328 110,152 103,723 99,570 100,377
Equity securities 0 0 0 0 0 0
----------- ----------- ----------- ----------- ----------- -----------
Total securities held to maturity $ 113,888 $ 115,328 $ 110,152 $ 103,723 $ 99,570 $ 100,377
=========== =========== =========== =========== =========== ===========
10
ANALYSIS OF SECURITIES (cont.)
(Fully Tax Equivalent Basis)
(in thousands of dollars)
The maturity distribution (2) and weighted average yields (1) for debt securities portfolio at December 31, 1995, are as
follows:
After One After Five
Within Year Years Over
One Within Five Within Ten Ten
Year Years Years Years
----------- ----------- ----------- -----------
Securities available-for-sale:
U.S. Treasury securities
Book value 100 27,449 0 0
Yield 6.56 5.97
Government agencies and corporations
Book value 1,000 1,050 100 0
Yield 7.70 7.91 9.02
Mortgage-backed securities
Book value 0 5,327 20,577 22,398
Yield 7.11 6.34 6.51
Obligations of state and political
subdivisions
Book value 0 591 0 1,485
Yield 11.55 8.57
Other debt securities
Book value 0 999 0 0
Yield 9.34
----------- ----------- ----------- -----------
Total debt securities available-for-sale:
Book value 1,100 35,416 20,677 23,883
Yield 7.60 6.39 6.35 6.64
=========== =========== =========== ===========
Securities held-to-maturity:
U.S. Treasury securities
Book value 2,549 11,062 0 0
Yield 4.39 5.28
Government agencies and corporations
Book value 0 2,598 300 0
Yield 7.52 6.42
Mortgage-backed securities
Book value 0 15,050 39,028 23,241
Yield 6.81 6.21 5.67
Obligations of state and political
subdivisions
Book value 7 586 758 17,696
Yield 4.27 9.92 10.53 9.12
Other debt securities
Book value 0 1,013 0 0
Yield 9.73
----------- ----------- ----------- -----------
Total debt securities held-to-maturity:
Book value 2,556 30,309 40,086 40,937
Yield 4.38 6.47 6.30 7.16
=========== =========== =========== ===========
(1) Tax exempt income converted to a fully taxable equivalent basis at a 34% rate.
(2) The maturity distribution of mortgage-backed securities is based upon anticipated payments as
computed by using the historic average repayment speed from date of issue.
(3) There are no investments in securities of any one issuer that exceed 10% of stockholders' equity.
11
ANALYSIS OF LOAN PORTFOLIO
Analysis of Loans Outstanding
(in thousands of dollars)
The Registrant segregates its loan portfolio into four basic segments: commercial (including agri-business and agricultural
loans), real estate mortgages, installment and credit cards (including personal line of credit loans). The loan portfolio as of
December 31, 1995, 1994, 1993, 1992, and 1991 is as follows:
1995 1994 1993 1992 1991
----------- ----------- ----------- ----------- -----------
Commercial loans:
Taxable $ 192,359 $ 173,325 $ 144,274 $ 128,268 $ 97,510
Tax exempt 3,636 3,207 4,501 5,594 6,521
Total commercial loans 195,995 176,532 148,775 133,862 104,031
Real estate mortgage loans 55,948 47,296 49,816 50,413 50,697
Installment loans 58,175 48,228 46,914 36,111 33,312
Credit card and line of credit loans 17,499 15,900 14,680 13,816 11,986
----------- ----------- ----------- ----------- -----------
Total loans 327,617 287,956 260,185 234,202 200,026
Less allowance for loan losses 5,472 4,866 4,010 3,095 2,612
----------- ----------- ----------- ----------- -----------
Net loans $ 322,145 $ 283,090 $ 256,175 $ 231,107 $ 197,414
=========== =========== =========== =========== ===========
The real estate mortgage loan portfolio includes construction loans totaling $1,224, $426, $223, $1,164, and $885 as of
December 31, 1995, 1994, 1993, 1992 and 1991, respectively. The above loan classifications are based on the nature of the loans as
of the loan origination date, and are independent as to the use of the funds by the borrower. There are no foreign loans included
in the above analysis.
12
ANALYSIS OF LOAN PORTFOLIO (cont.)
Analysis of Loans Outstanding (cont.)
(in thousands of dollars)
Repricing opportunities of the loan portfolio occur either according to predetermined adjustable rate schedules included in
the related loan agreements or upon scheduled maturity of each principal payment. The following table indicated the rate
sensitivity of the loan portfolio as of December 31, 1995. The table includes the real estate loans held-for-sale and assumes
these loans will not be sold during the various time horizons.
Credit
Card
Real and Line
Commercial Estate Installment of Credit Total Percent
----------- ----------- ----------- ----------- ----------- -----------
Immediately adjustable interest rates
or original maturity of one day $ 155,694 $ 2,071 $ 3,503 $ 14,574 $ 175,842 53.6%
Other within one year 8,761 25,515 22,932 0 57,208 17.4
After one year, within five years 25,551 22,753 31,070 2,925 82,299 25.1
Over five years 5,533 5,677 670 0 11,880 3.6
Nonaccrual loans 456 77 0 0 533 0.2
----------- ----------- ----------- ----------- ----------- -----------
Total loans $ 195,995 $ 56,093 $ 58,175 $ 17,499 $ 327,762 100.0%
=========== =========== =========== =========== =========== ===========
A portion of the Bank's loans are short-term maturities. At maturity, credits are reviewed, and if renewed, are renewed at
rates and conditions that prevail at the time of maturity.
Loans due after one year which have a predetermined interest rate and loans due after one year which have floating or
adjustable interest rates as of December 31, 1995 amounted to $76,568 and $109,332 respectively.
13
ANALYSIS OF LOAN PORTFOLIO (cont.)
Review of Nonperforming Loans
(in thousands of dollars)
The following is a summary of nonperforming loans as of December 31, 1995, 1994, 1993, 1992 and 1991.
1995 1994 1993 1992 1991
----------- ----------- ----------- ----------- -----------
PART A - PAST DUE ACCRUING LOANS (90 DAYS OR MORE)
Real estate mortgage loans $ 122 $ 0 $ 1 $ 79 $ 27
Commercial and industrial loans 69 16 315 100 1,127
Loans to individuals for household,
family and other personal expenditures 18 19 346 42 55
Loans to finance agriculture production
and other loans to farmers 0 0 0 0 0
----------- ----------- ----------- ----------- -----------
Total past due loans 209 35 662 221 1,209
----------- ----------- ----------- ----------- -----------
PART B - NONACCRUAL LOANS
Real estate mortgage loans 76 18 0 0 22
Commercial and industrial loans 456 0 0 0 198
Loans to individuals for household,
family and other personal expenditures 0 0 0 0 5
Loans to finance agriculture production
and other loans to farmers 0 0 0 0 628
----------- ----------- ----------- ----------- -----------
Total nonaccrual loans 532 18 0 0 853
----------- ----------- ----------- ----------- -----------
PART C - TROUBLED DEBT RESTRUCTURED LOANS 1,432 1,484 0 86 4
----------- ----------- ----------- ----------- -----------
Total nonperforming loans $ 2,173 $ 1,537 $ 662 $ 307 $ 2,066
=========== =========== =========== =========== ===========
Nonearning assets of the Corporation include nonaccrual loans (as indicated above), nonaccrual investments, other real
estate, and repossessions which amounted to $1,207 at December 31, 1995.
14
ANALYSIS OF LOAN PORTFOLIO (cont.)
Comments Regarding Nonperforming Assets
PART A - CONSUMER LOANS
Consumer installment loans, except those loans that are secured by real
estate, are not placed on a nonaccrual status since these loans are
charged-off when they have been delinquent from 90 to 180 days, and when the
related collateral, if any, is not sufficient to offset the indebtedness.
Advances under Mastercard and Visa programs, as well as advances under all
other consumer lines of credit programs, are charged-off when collection
appears doubtful.
PART B - NONPERFORMING LOANS
When a loan is classified as a nonaccrual loan, interest on the loan is
no longer accrued and all accrued interest receivable is charged off. It is
the policy of the Bank that all unsecured loans (i.e. loans for which the
collateral is insufficient to cover all principal and accrued interest) will
be reclassified as nonperforming loans to the extent they are unsecured, on or
before the loan becomes 90 days delinquent. Thereafter, interest is recognized
and included in income only when received.
As of December 31, 1995, loans totaling $532,000 were on nonaccrual
status.
PART C - TROUBLED DEBT RESTRUCTURED LOANS
Loans renegotiated as troubled debt restructuring are those loans for
which either the contractual interest rate has been reduced and/or other
concessions are granted to the borrower because of a deterioration in the
financial condition of the borrower which results in the inability of the
borrower to meet the terms of the loan.
Loans renegotiated as troubled debt restructuring totaled $1,432,000 as
of December 31, 1995. Interest income of $96,000 was recognized in 1995. Had
these loans been performing under the original contract terms, an additional
$53,000 would have been reflected in interest income during 1995. The Bank is
not committed to lend additional funds to debtors whose loans have been
modified.
PART D - OTHER NONPERFORMING ASSETS
The Bank adopted SFAS No. 114 and SFAS No. 118, 'Accounting by Creditors
for Impairment of a Loan' at January 1, 1995. Under these standards, loans
considered to be impaired are reduced to the present value of future cash
flows or to the fair value of collateral, by allocating a portion of the
allowance for loan losses to such loans. If these allocations cause the
allowance for loan losses to require an increase, such increase is reported as
bad debt expense. As part of the loan review process, management reviews all
loans classified as 'special mention' or below, as well as other loans that
might warrant application of SFAS No. 114 and SFAS No. 118. The effect of
adopting these accounting standards on January 1, 1995 was immaterial and at
December 31, 1995, no loans were considered as impaired.
The management of the Bank is of the opinion that there are no
significant foreseeable losses relating to substandard or nonperforming
assets, except as discussed above.
15
PART E - LOAN CONCENTRATIONS
There were no loan concentrations within industries which exceeded ten
percent of total assets. It is estimated that over 98% of all the Bank's
commercial, industrial, agri-business and agricultural real estate mortgage,
real estate construction mortgage and consumer loans are made within its basic
trade area.
Basis For Determining Allowance For Loan Losses
Management is charged with the responsibility of determining the adequacy
of the allowance for loan losses. This responsibility is fulfilled by
management in the following ways:
1. Management reviews the larger individual loans for unfavorable
collectibility factors and assesses the requirement for specific reserves on
such credits. For those loans not subject to specific reviews, management
reviews previous loan loss experience to establish historical ratios and
trends in charge-offs by loan category. The ratios of net charge-offs to
particular types of loans enable management to estimate charge-offs in future
periods by loan category and thereby establish appropriate reserves for loans
not specifically reviewed.
2. Management reviews the current and anticipated economic conditions of
its lending market to determine the effects on future loan charge-offs by loan
category, in addition to the effects on the loan portfolio as a whole.
3. Management reviews delinquent loan reports to determine risk of future
loan charge-offs. High delinquencies are generally indicative of an increase
in future loan charge-offs.
Based upon the above described policy and objectives, $120,000, $795,000
and $790,000 were charged to the provision for loan losses and added to the
allowance for loan losses in 1995, 1994 and 1993, respectively.
The allocation of the allowance for loan losses to the various lending
areas is performed by management in relation to perceived exposure to loss in
the various loan portfolios. However, the allowance for loan losses is
available in its entirety to absorb losses in any particular loan category.
(Intentionally Left Blank)
16
ANALYSIS OF LOAN PORTFOLIO (cont.)
Summary of Loan Loss
(in thousands of dollars)
Following is a summary of the loan loss experience for the years ended December 31, 1995, 1994, 1993, 1992, and 1991.
1995 1994 1993 1992 1991
----------- ----------- ----------- ----------- -----------
Amount of loans outstanding, December 31, $ 327,617 $ 287,956 $ 260,185 $ 234,202 $ 200,026
=========== =========== =========== =========== ===========
Average daily loans outstanding during the
year ended December 31, $ 309,241 $ 271,391 $ 240,466 $ 213,599 $ 178,619
=========== =========== =========== =========== ===========
Allowance for loan losses, January 1, $ 4,866 $ 4,010 $ 3,095 $ 2,612 $ 1,777
----------- ----------- ----------- ----------- -----------
Loans charged-off
Commercial 137 27 99 446 1,016
Real Estate 48 0 4 258 20
Installment 112 93 97 217 221
Credit cards and personal credit lines 58 15 28 39 66
----------- ----------- ----------- ----------- -----------
Total loans charged-off 355 135 228 960 1,323
----------- ----------- ----------- ----------- -----------
Recoveries of loans previously charged-off
Commercial 26 107 40 11 18
Real Estate 0 1 1 0 0
Installment 63 81 56 85 106
Credit cards and personal credit lines 6 7 6 7 5
----------- ----------- ----------- ----------- -----------
Total recoveries 95 196 103 103 129
----------- ----------- ----------- ----------- -----------
Net loans charged-off 260 (61) 125 857 1,194
Purchase loan adjustment 746 0 250 0 59
Provision for loan loss charged to expense 120 795 790 1,340 1,970
----------- ----------- ----------- ----------- -----------
Balance December 31, $ 5,472 $ 4,866 $ 4,010 $ 3,095 $ 2,612
=========== =========== =========== =========== ===========
Ratio of net charge-offs during the period to
average daily loans outstanding
Commercial 0.03% (0.03)% 0.02% 0.20% 0.56%
Real Estate 0.01 0.00 0.00 0.12 0.01
Installment 0.02 0.01 0.02 0.06 0.07
Credit cards and personal credit lines 0.02 0.00 0.01 0.02 0.03
----------- ----------- ----------- ----------- -----------
Total 0.08% (0.02)% 0.05% 0.40% 0.67%
=========== =========== =========== =========== ===========
17
ANALYSIS OF LOAN PORTFOLIO (cont.)
Allocation of Allowance for Loan Losses
(in thousands of dollars)
The following is a summary of the allocation for loan losses as of December 31, 1995, 1994, 1993, 1992 and 1991.
1995 1994 1993
------------------------ ------------------------ ------------------------
Allowance Loans as Allowance Loans as Allowance Loans as
For Percentage For Percentage For Percentage
Loan of Gross Loan of Gross Loan of Gross
Losses Loans Losses Loans Losses Loans
----------- ----------- ----------- ----------- ----------- -----------
Allocated allowance for loan losses
Commercial $ 811 59.82 $ 665 61.31 $ 1,120 57.18
Real Estate 112 17.08 95 16.42 108 19.15
Installment 376 17.76 311 16.75 302 18.04
Credit cards and personal credit lines 112 5.34 101 5.52 95 5.63
----------- ----------- ----------- ----------- ----------- -----------
Total allocated allowance for loan losses 1,411 100.00 1,172 100.00 1,625 100.00
=========== =========== ===========
4,061 3,694 2,385
----------- ----------- -----------
Total allowance for loan losses $ 5,472 $ 4,866 $ 4,010
=========== =========== ===========
1992 1991
------------------------ ------------------------
Allowance Loans as Allowance Loans as
For Percentage For Percentage
Loan of Gross Loan of Gross
Losses Loans Losses Loans
----------- ----------- ----------- -----------
Allocated allowance for loan losses
Commercial $ 864 57.16 $ 1,168 52.01
Real Estate 105 21.52 90 25.35
Installment 230 15.42 214 16.65
Credit cards and personal credit lines 87 5.90 76 5.99
----------- ----------- ----------- -----------
Total allocated allowance for loan losses 1,286 100.00 1,548 100.00
=========== ===========
1,809 1,064
----------- -----------
Total allowance for loan losses $ 3,095 $ 2,612
=========== ===========
18
ANALYSIS OF DEPOSITS
(in thousands of dollars)
The average daily deposits for the years ended December 31, 1995, 1994 and 1993, and the average rates paid on those deposits
are summarized in the following table:
1995 1994 1993
------------------------ ------------------------ -----------------------
Average Average Average Average Average Average
Daily Rate Daily Rate Daily Rate
Balance Paid Balance Paid Balance Paid
----------- ----------- ----------- ----------- ----------- -----------
Demand deposits $ 60,753 0.00 $ 52,893 0.00 $ 37,709 0.00
Savings accounts:
Regular savings 46,123 2.32 55,855 2.72 38,263 2.77
Interest bearing checking 55,355 2.41 58,945 2.36 54,197 2.55
Time deposits:
Deposits of $100,000 or more 73,449 6.00 54,389 4.34 42,458 3.74
Other time deposits 177,992 5.64 148,251 4.61 128,520 4.73
----------- ----------- ----------- ----------- ----------- -----------
Total deposits $ 413,672 4.07 $ 370,333 3.27 $ 301,147 3.35
=========== =========== =========== =========== =========== ===========
As of December 31, 1995, time certificates of deposit in denominations of $100,000 or more will mature as follows:
Within three months $ 33,382
Over three months, within six months 12,922
Over six months, within twelve months 9,237
Over twelve months 6,822
-----------
Total time certificates of deposit in
denominations of $100,000 or more $ 62,363
===========
19
RETURN ON EQUITY AND ASSETS
The rates of return on average daily assets and stockholders' equity, the
dividend payout ratio, and the average daily stockholders' equity to average
daily assets for the years ended December 31, 1995, 1994 and 1993 are as
follows:
1995 1994 1993
--------- --------- ---------
Percent of net income to:
Average daily total assets 1.05 1.10 1.11
Average daily stockholders' equity 17.06 17.73 16.51
Percentage of dividends declared per
common share to net income per
weighted average number of common
shares outstanding (1,438,496
shares in 1995, 1994 and 1993) 18.88 16.57 17.01
Percentage of average daily
stockholders' equity to average
daily total assets 6.18 6.19 6.71
20
SHORT-TERM BORROWINGS
The following is a schedule of statistical information relating to
securities sold under agreement to repurchase maturing within one year and are
secured by either U.S. Government agency securities or mortgage-backed
securities classified as other debt securities. There were no other categories
of short-term borrowings for which the average balance outstanding during the
period was 30 percent or more of shareholders' equity at the end of the
period.
1995 1994 1993
--------- --------- ---------
Outstanding at year end $ 58,151 $ 41,750 $ 29,372
Approximate average interest rate at
year end 5.35 5.11 3.22
Highest amount outstanding as of any
month end during the year $ 79,334 $ 50,460 $ 42,485
Approximate average outstanding
during the year $ 61,398 $ 42,584 $ 38,299
Approximate average interest rate
during the year 5.69 3.96 3.34
Securities sold under agreement to repurchase include both transactions
initiated by the investment division of the Bank, as well as the automatic
borrowings from selected demand deposit customers who had excess balances in
their accounts.
21
ITEM 2. PROPERTIES
The Bank conducts its operations from the following locations:
Main Office Ligonier
202 E. Center St. 1470 U.S. Highway 33 South
Warsaw, IN Ligonier, IN
Warsaw Drive-Up Mentone
East Center St. 202 East Main St.
Warsaw, IN Mentone, IN
Akron Middlebury
102 East Rochester 712 Wayne Ave.
Akron, IN Middlebury, IN
Argos Milford
100 North Michigan Indiana State Road 15 North
Argos, IN Milford, IN
Bremen Nappanee
1600 Indiana State Rod 331 202 West Market St.
Bremen, IN Nappanee, IN
Columbia City North Webster
507 North Main St. 644 North Main St.
Columbia City, IN North Webster, IN
Concord Pierceton
4202 Elkhart Rd. 202 South First St.
Goshen, IN Pierceton, IN
Cromwell Roann
111 North Jefferson St. 110 Chippewa
Cromwell, IN Roann, IN
Elkhart Rochester
864 East Beardsley St. 507 East 9th St.
Elkhart, IN Rochester, IN
Elkhart East Shipshewana
22050 State Road 120 895 North Van Buren St.
Elkhart, IN Shipshewana, IN
Goshen Downtown Silver Lake
102 North Main St. 102 Main St.
Goshen, IN Silver Lake, IN
Goshen South Syracuse
2513 South Main St. 502 South Huntington
Goshen, IN Syracuse, IN
LaGrange Wabash North
901 South Detroit 1004 North Cass St.
LaGrange, IN Wasbash, IN
22
Wabash South Winona Lake
1940 South Wabash St. 99 Chestnut St.
Wabash, IN Winona Lake, IN
Warsaw East Free-standing ATM
3601 Commerce Dr. 2101 East Center St.
Warsaw, IN Warsaw, IN
Warsaw West
1221 West Lake St.
Warsaw, IN
The Bank leases from third parties the real estate and buildings for its
offices in Akron and Milford. In addition, the Bank leases the real estate for
its Wabash North office and its free-standing ATM. All the other branch
facilities are owned by the Bank. The Bank also owns parking lots in downtown
Warsaw for the use and convenience of Bank employees and customers, as well as
leasehold improvements, equipment, furniture and fixtures necessary and
appropriate to operate the banking facilities.
In addition, the Bank owns a building at 110 South High St., Warsaw,
Indiana, which it uses for various offices and a building at 113 East Center
St., Warsaw, Indiana, which it uses for office and computer facilities. The
Bank also leases from third parties facilities in Warsaw, Indiana, for the
storage of supplies and for employee training.
None of the Bank's assets are the subject of any material encumbrances.
ITEM 3. LEGAL PROCEEDINGS
There are no material pending legal proceedings other than ordinary
routine litigation incidental to the business to which the Registrant and the
Bank are a party or of which any of their property is subject.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted to a vote of security holders from October 1,
1992 to December 31, 1995.
(Intentionally Left Blank)
23
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS
Information relating to the principal market for and the prices of the
Registrant's common stock, and information as to dividends declared by the
Registrant, are contained under the caption "Stock and Dividend Information"
in the 1995 Annual Report and are incorporated herein by reference in response
to this item. On December 31, 1995, the Registrant had 870 shareholders,
including those employees who participate in the Registrant's 401(K) plan.
ITEM 6. SELECTED FINANCIAL DATA
A five year consolidated financial summary, containing the required
selected financial data, appears under the caption "Selected Financial Data"
in the 1995 Annual Report and is incorporated herein by reference in response
to this item.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Management's Discussion and Analysis of Financial Condition and Results
of Operations appears under the caption "Management's Discussion and Analysis
of Financial Condition and Results of Operations" in the 1995 Annual Report
and is incorporated herein by reference in response to this item.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The following consolidated financial statements appear in the 1995 Annual
Report and are incorporated herein by reference in response to this item.
Consolidated Balance Sheets at December 31, 1995 and 1994.
Consolidated Statements of Income for the years ended December 31, 1995, 1994
and 1993.
Consolidated Statements of Changes in Stockholders' Equity for the years ended
December 31, 1995, 1994 and 1993.
Consolidated Statements of Cash Flows for the years ended December 31, 1995,
1994 and 1993.
Notes to Consolidated Financial Statements.
Report of Independent Auditors.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Not applicable.
24
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information appearing in the Registrant's definitive Proxy Statement
dated March 11, 1996, is incorporated herein by reference in response to this
item.
ITEM 11. EXECUTIVE COMPENSATION
The information appearing in the Registrant's definitive Proxy Statement
dated March 11, 1996, is incorporated herein by reference in response to this
item.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information appearing in the Registrant's definitive Proxy Statement
dated March 11, 1996, is incorporated herein by reference in response to this
item.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information appearing in the Registrant's definitive Proxy Statement
dated March 11, 1996, is incorporated herein by reference in response to this
item.
25
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) The documents listed below are filed as a part of this report:
(1) Financial Statements.
---------------------
The following financial statements of the Registrant and its
subsidiaries appear in the 1995 Annual Report and are specifically incorporated
by reference under Item 8 of this Form 10-K, or are a part of this Form 10-K,
as indicated and at the pages set forth below.
Reference
---------
1995 Annual
Form 10-K Report
--------- -----------
Consolidated Balance Sheets at December 31,
1995 and 1994. 7
Consolidated Statements of Income for the
years ended December 31, 1995, 1994 and 1993. 8
Consolidated Statements of Changes in
Stockholders' Equity for the years ended
December 31, 1995, 1994 and 1993. 9
Consolidated Statements of Cash Flows for the
years ended December 31, 1995, 1994 and 1993. 10
Notes to Consolidated Financial Statements. 11 - 20
Report of Independent Auditors. 20
(2) Financial Statement Schedules
-----------------------------
The financial statement schedules of the Registrant and its subsidiary
have been omitted because of the absence of conditions under which they are
required or because the required information is given in the financial
statements or notes thereto.
[Intentionally Left Blank]
26
SIGNATURES
----------
Pursuant to the requirements of Section 15(d) of the Securities and
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
LAKELAND FINANCIAL CORPORATION
Date: March 12, 1996 By R. Douglas Grant
(R. Douglas Grant) President
Pursuant to the requirements of the Securities and Exchange Act of 1934,
this report has been signed by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Date: March 12, 1996 R. Douglas Grant
(R. Douglas Grant) Principal Executive
Officer and Director
Date: March 12, 1996 Terry M. White
(Terry M. White) Principal Financial and
Accounting Officer
Date: March 12, 1996 Anna K. Duffin
(Anna K. Duffin) Director
Date:
(Eddie Creighton) Director
Date: March 12, 1996 L. Craig Fulmer
(L. Craig Fulmer) Director
Date: March 12, 1996 Jerry L. Helvey
(Jerry L. Helvey) Director
Date: March 12, 1996 Homer A. Kent
(Dr. Homer A. Kent) Director
Date: March 12, 1996 J. Alan Morgan
(J. Alan Morgan) Director
Date: March 12, 1996 Richard L. Pletcher
(Richard L. Pletcher) Director
Date:
(Joseph P. Prout) Director
Date: March 12, 1996 Philip G. Spear
(Philip G. Spear) Director
Date:
(Terry L. Tucker) Director
Date:
(G.L. White) Director
27
EXHIBIT INDEX
The following Exhibits are filed as part of this Report and not
incorporated by reference from another document:
Exhibit 13 - 1995 Report to Shareholders with Report of Independent
Auditors.
Exhibit 21 - Subsidiaries
28
EXHIBIT 13
1995 Report to Shareholders with Report of Independent Auditors.
29
EXHIBIT 21
Subsidiaries. The Registrant has one wholly owned subsidiary, Lake City Bank,
Warsaw, Indiana, a banking corporation organized under the laws of the State
of Indiana.
30