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1
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
For the fiscal year ended December 31, 1999
Commission file number 0-10402
WILSON BANK HOLDING COMPANY
(Exact name of registrant as specified in its charter)
Tennessee 62-1497076
(State or other jurisdiction (I.R.S. Employer Identification Number)
of incorporation or organization)
623 West Main Street
Lebanon, Tennessee 37087
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(615) 444-2265
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
COMMON STOCK, $2.00 PAR VALUE PER SHARE
(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 shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
--- ---
Indicate by check mark 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. [ ]
The aggregate market value of the voting stock held by non-affiliates of the
registrant on March 1, 2000, was approximately $54,274,112. The market value
calculation was determined using $32.00 per share.
Shares of common stock, $2.00 par value per share, outstanding on March 1, 2000
were 1,985,242.
DOCUMENTS INCORPORATED BY REFERENCE
Part of Form 10-K Documents from which portions are incorporated by
reference
Part II Portions of the Registrant's Annual Report to
Shareholders for the fiscal year ended December 31,
1999 are incorporated by reference into Items 5, 6,
7, and 8.
Part III Portions of the Registrant's Proxy Statement relating
to the Registrant's Annual Meeting of Shareholders to
be held on April 11, 2000 are incorporated by
reference into Items 10, 11, 12 and 13.
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PART I
ITEM 1. DESCRIPTION OF BUSINESS.
GENERAL
Wilson Bank Holding Company (the "Company") was incorporated on March 17, 1992
under the laws of the State of Tennessee. The purpose of the Company was to
acquire all of the issued and outstanding capital stock of Wilson Bank and Trust
(the "Bank") and act as a one bank holding company. On November 17, 1992, the
Company acquired 100% of the capital stock of the Bank pursuant to the terms of
a plan of share exchange and agreement.
All of the Company's banking business is conducted through the Bank, a state
chartered bank organized under the laws of the State of Tennessee, DeKalb
Community Bank ("DCB") and Community Bank of Smith County ("CBSC"). The Bank on
December 31, 1999 had eight full service banking offices located in Wilson
County, Tennessee, one full service banking facility in Trousdale County,
Tennessee and one full service banking office in eastern Davidson County. DCB
had two full service banking offices in DeKalb County, one office located in
Smithville, Tennessee and one office located in Alexandria, Tennessee. CBSC had
one office located in Carthage, Smith County, Tennessee. DCB began operations in
April 1996 and CBSC in December 1996. As of December 31, 1999, revenues and
expenses of DCB and CBSC, have not had a material effect on the earnings of the
Company. On October 1, 1999, the Company stopped transacting new business
through its wholly-owned subsidiary Hometown Finance, Inc. (the "Finance
Company"). The loans made by the Finance Company, while still assets of the
Finance Company, are currently being collected by the Company. Additionally, all
of the employees of the Finance Company are currently employees of the Company.
The Company's principal executive office is located at 623 West Main Street,
Lebanon, Tennessee, which is also the principal location of the Bank. The Bank's
branch offices are located at 1444 Baddour Parkway, Lebanon, Tennessee; 200
Tennessee Boulevard, Lebanon, Tennessee; Public Square, Watertown, Tennessee;
8875 Stewart's Ferry Pike, Gladeville, Tennessee; 1476 North Mt. Juliet Road,
Mt. Juliet, Tennessee; 127 McMurry Boulevard, Hartsville, Tennessee; 1130 Castle
Heights Avenue North, Lebanon, Tennessee (which opened on December 5, 1998); the
Wal-Mart Super Center, Lebanon, Tennessee; and 4736 Andrew Jackson Parkway in
Hermitage, Tennessee. Management believes that Wilson County and Trousdale
County offer an environment for continued banking growth in the Company's target
market, which consists of local consumers, professionals and small businesses.
The Bank offers a wide range of banking services, including checking, savings,
and money market deposit accounts, certificates of deposit and loans for
consumer, commercial and real estate purposes. The Bank also offers custodial,
trust and discount brokerage services to its customers. The Bank does not have a
concentration of deposits obtained from a single person or entity or a small
group of persons or entities, the loss of which would have a material adverse
effect on the business of the Bank. Furthermore, no concentration of loans
exists within a single industry or group of related industries.
The Bank was organized in 1987 to provide Wilson County a locally-owned,
locally-managed commercial bank. Since its opening, the Bank has experienced a
steady growth in deposits and loans as a result of providing personal, service
oriented banking services to its targeted market. For the year ended December
31, 1999, the Company reported net earnings of approximately $4.9 million and
had total assets of approximately $495.2 million.
DeKalb County Bank was organized and began operations as a de novo state
chartered bank in 1996. DCB is 50% owned by the Company and 50% owned by
residents of DeKalb County. DCB operates two full service branches, one in
Smithville and one in Alexandria, Tennessee. DCB is considered a subsidiary of
the Company for purposes of the Bank Holding Company Act of 1956.
Management believes that DeKalb County offers an environment for continued
growth since it is geographically close to Wilson County and two locally-owned
banks in DeKalb County were acquired by larger banks in 1998. DCB offers a wide
range of banking services, including checking, savings, and money market deposit
accounts, certificates of deposit and loans for consumer, commercial and real
estate purposes. DCB does not have a concentration of deposits obtained from a
single person or entity or a small group of persons or entities, the loss of
which would have a material adverse effect on the business of DCB. Furthermore,
no concentration of loans exists within a single industry or group of related
industries.
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Community Bank of Smith County was organized as a de novo state chartered bank
in 1996. CBSC is 50% owned by the Company and 50% owned by residents of Smith
County. CBSC is considered a subsidiary of the Company for purposes of the Bank
Holding Company Act of 1956. Management believes that Smith County offers an
environment for continued growth since it is contiguous to Wilson County and has
only three other financial institutions. CBSC offers a wide range of banking
services, including checking, savings, and money market deposit accounts,
certificates of deposit and loans for consumer, commercial and real estate
purposes. CBSC does not have a concentration of deposits obtained from a single
person or entity or a small group of persons or entities, the loss of which
would have a material adverse effect on the business of CBSC. Furthermore, no
concentration of loans exists within a single industry or group of related
industries.
FINANCIAL AND STATISTICAL INFORMATION
The Company's audited financial statements, selected financial data and
Management's Discussion and Analysis of Financial Condition and Results of
Operation contained in the Company's Annual Report to Shareholders for the year
ended December 31, 1999 filed as Exhibit 13 to this Form 10-K (the "1999 Annual
Report"), are incorporated herein by reference.
REGULATION AND SUPERVISION
In addition to the information set forth herein, Management's Discussion and
Analysis of Financial Condition and Results of Operations, incorporated by
reference in Item 7 hereof, further discusses recent banking legislation and
regulation and should be reviewed in conjunction herewith.
The Company, the Bank, DCB and CBSC are subject to extensive regulation under
state and federal statutes and regulations. The discussion in this section,
which briefly summarizes certain of such statutes, does not purport to be
complete, and is qualified in its entirety by reference to such statutes. Other
state and federal legislation and regulations directly and indirectly affecting
banks are likely to be enacted or implemented in the future; however, such
legislation and regulations and their effect on the business of the Company and
its subsidiaries cannot be predicted.
The Company is a bank holding company within the meaning of the Bank Holding
Company Act of 1956 (the "Act") and is registered with the Board of Governors of
the Federal Reserve System (the "Board"). The Company is required to file annual
reports with, and is subject to examination by, the Board. The Bank, DCB and
CBSC are chartered under the laws of the state of Tennessee and are subject to
the supervision of, and are regularly examined by, the Tennessee Department of
Financial Institutions. The Bank, DCB and CBSC are also regularly examined by
the Federal Deposit Insurance Corporation.
Under the Act, a bank holding company may not directly or indirectly acquire
ownership or control of more than five percent of the voting shares or
substantially all of the assets of any company, including a bank, without the
prior approval of the Board. In addition, bank holding companies are generally
prohibited under the Act from engaging in non-banking activities, subject to
certain exceptions and the recent modernization of the financial services
industry in connection with the passing of the Gramm-Leach-Bliley Act of 1999.
Under the Act, the Board is authorized to approve the ownership by a bank
holding company of shares of any company whose activities have been determined
by the Board to be so closely related to banking or to managing or controlling
banks as to be a proper incident thereto.
In November 1999, the Gramm-Leach-Bliley Act of 1999 (the "GLB Act") became law.
Under the GLB Act, a "financial holding company" may engage in activities the
Board determines to be financial in nature or incidental to such financial
activity or complementary to a financial activity and not a substantial risk to
the safety and soundness of such depository institutions or the financial
system. Generally, such companies may engage in a wide range of securities
activities and insurance underwriting and agency activities.
Under the Tennessee Bank Structure Act, a bank holding company which controls
30% or more of the total deposits in all federally insured financial
institutions in Tennessee is prohibited from acquiring any bank in Tennessee.
Furthermore, no bank holding company may acquire any bank in Tennessee that has
been in operation less than five years or organize a new bank in Tennessee,
except in the case of certain interim bank mergers and acquisitions of banks in
financial difficulty. State banks and national banks in Tennessee, however, may
establish branches anywhere in the state.
The Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 (the
"IBBEA") authorized interstate acquisitions of banks and bank holding companies
without geographic limitation beginning on June 1, 1997. In addition, on that
date, the IBBEA authorized a bank to merge with a bank in another state as long
as neither of the states has opted out of interstate branching between the date
of enactment of the IBBEA and May 1, 1997. Tennessee enacted interstate
branching laws in response to the federal law which prohibit the establishment
or acquisition in Tennessee by any bank of a branch office, branch bank or other
branch facility in Tennessee except (i) a Tennessee-chartered bank, (ii) a
national bank which has its main office in Tennessee or (iii) a bank which
merges or consolidates with a Tennessee-chartered bank or national bank with its
main office in Tennessee.
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The Company, the Bank, DCB and CBSC are subject to certain restrictions imposed
by the Federal Reserve Act and the Federal Deposit Insurance Act, respectively,
on any extensions of credit to the bank holding company or its subsidiary banks,
on investments in the stock or other securities of the bank holding company or
its subsidiary banks, and on taking such stock or other securities as collateral
for loans of any borrower.
The Federal Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA")
covers a wide expanse of banking regulatory issues. FDICIA deals with
recapitalization of the Bank Insurance Fund, with deposit insurance reform,
including requiring the FDIC to establish a risk-based premium assessment
system, and with a number of other regulatory and supervisory matters.
The Financial Reform, Recovery and Enforcement Act of 1989 ("FIRREA") provides
that a holding company's controlled insured depository institutions are liable
for any loss incurred by the FDIC in connection with the default of, or any
FDIC-assisted transaction involving, an affiliated insured bank or savings
association.
The maximum permissible rates of interest on most commercial and consumer loans
made by the Company's bank subsidiaries are governed by Tennessee's general
usury law and the Tennessee Industrial Loan and Thrift Companies Act
("Industrial Loan Act"). Certain other usury laws affect limited classes of
loans, but the laws referenced above are by far the most significant.
Tennessee's general usury law authorizes a floating rate of 4% per annum over
the average prime or base commercial loan rate, as published by the Federal
Reserve Board from time to time, subject to an absolute 24% per annum limit. The
Industrial Loan Act, which is generally applicable to most of the loans made by
the Company's bank subsidiaries in Tennessee, authorizes an interest rate of up
to 24% per annum and also allows certain loan charges, generally on a more
liberal basis than does the general usury law.
COMPETITION
The banking industry is highly competitive. The Company, through its subsidiary
banks, competes with national and state banks for deposits, loans, and trust and
other services.
The Bank competes with much larger commercial banks in Wilson County, including
four banks owned by regional multi-bank holding companies headquartered out of
Tennessee and four banks owned by Tennessee multi-bank holding companies. These
institutions enjoy existing depositor relationships and greater financial
resources than the Company and can be expected to offer a wider range of banking
services. In addition, the Bank competes with two credit unions located in
Wilson County.
DCB competes with much larger commercial banks in DeKalb County, including two
banks owned by Tennessee multi-bank holding companies. While these institutions
enjoy existing depositor relationships and greater financial resources than DCB
and can be expected to offer a wider range of banking services, it is believed
that DCB can expect to attract customers since it is locally owned and most loan
and management decisions will be made at the local level. In addition, the Bank
competes with one commercial bank headquartered in DeKalb County.
CBSC competes with three commercial banks in or near Smith County, including two
banks based in Smith County and one based in an adjacent county. These
institutions enjoy existing depositor relationships; however, the Company
believes that CBSC can be expected to offer a wider range of banking services at
CBSC through its financial resources as well as programs offered by other
subsidiaries of the Company.
Given the competitive market place, the Company makes no predictions as to how
its relative position will change in the future.
MONETARY POLICIES
The results of operations of the Bank, the Company and the Company's other bank
subsidiaries are affected by the policies of the regulatory authorities,
particularly the Board. An important function of the Board is to regulate the
national supply of bank credit in order to combat recession and curb inflation.
Among the instruments used to attain these objectives are open market operations
in U.S. government securities, changes in the discount rate on bank borrowings
and changes in reserve requirements relating to member bank deposits. These
instruments are used in varying combinations to influence overall growth and
distribution of bank loans, investments and deposits, and their use may also
affect interest rates charged on loans and paid for deposits. Policies of the
regulatory agencies have had a significant effect on the operating results of
commercial banks in the past and are expected to do so in the future. The effect
of such policies upon the future business and results of operations of the
Company, the Bank, DCB and CBSC cannot be predicted with accuracy.
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EMPLOYMENT
As of March 20, 2000, the Company and its subsidiaries collectively employed 193
full-time equivalent employees and 22 part-time employees. Additional personnel
will be hired as needed to meet future growth.
YEAR 2000
Many currently installed computer systems, software programs, and embedded data
chips are programmed using a 2-digit date field and are therefore unable to
distinguish dates beyond the 20th century. A failure to identify and correct any
mission-critical internal or third party year 2000 processing problem could have
a material adverse operational or financial consequence to the Company.
The Company established a Year 2000 Committee that, together with external
consultants, developed a process for addressing the year 2000 issue including
performing an inventory, an assessment, remediation procedures (to the extent
necessary) and testing procedures of all mission-critical information systems
and equipment and machinery that contain embedded technology, as well as
obtaining assurances from all mission-critical third parties as to their own
year 2000 preparedness. As of the date hereof, all of the Company's
mission-critical systems have been successfully tested for year 2000 compliance
and the Company has not experienced any significant year 2000 problems with its
own mission-critical systems or any mission-critical third parties. Although the
Company has not experienced any significant year 2000 problems to date, it plans
to continue to monitor the situation closely.
The Company cannot be sure that it will be completely successful in its efforts
to address the year 2000 issue or that problems arising from the year 2000 issue
will not cause a material adverse effect on its operating results or financial
condition. The Company believes, however, that its most reasonably likely
worst-case scenario would relate to problems with the systems of third parties
rather than with its internal systems. The Company is limited in its efforts to
address the year 2000 issue as it relates to third parties and relies solely on
the assurance of these third parties as to their year 2000 preparedness.
For further information on Year 2000, please refer to "Year 2000 Issues" under
the heading "Management's Discussion and Analysis of Financial Condition and
Results of Operations" on page 20 of the Company's 1999 Annual Report, which is
incorporated herein by reference.
STATISTICAL INFORMATION REQUIRED BY GUIDE 3
The statistical information required to be displayed under Item 1 pursuant to
Guide 3, "Statistical Disclosure by Bank Holding Companies," of the Exchange Act
Industry Guides is incorporated herein by reference to the Consolidated
Financial Statements and the notes thereto and the Management's Discussion and
Analysis sections in the Company's 1999 Annual Report. Certain information not
contained in the Company's 1999 Annual Report, but required by Guide 3, is
contained in the tables immediately following:
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
I. Distribution of Assets, Liabilities and Stockholders' Equity:
Interest Rate and Interest Differential
The Schedule which follows indicates the average balances for each
major balance sheet item, an analysis of net interest income and the
change in interest income and interest expense attributable to changes
in volume and changes in rates.
The difference between interest income on interest-earning assets and
interest expense on interest-bearing liabilities is net interest
income, which is the Company's gross margin. Analysis of net interest
income is more meaningful when income from tax-exempt earning assets is
adjusted to a tax equivalent basis. Accordingly, the following schedule
includes a tax equivalent adjustment of tax-exempt earning assets,
assuming a weighted average Federal income tax rate of 34%.
In this Schedule "change due to volume" is the change in volume
multiplied by the interest rate for the prior year. "Change due to
rate" is the change in interest rate multiplied by the volume for the
current year. Changes in interest income and expense not due solely to
volume or rate changes are included in the "change due to rate"
category.
Non-accrual loans have been included in the loan category. Loan fees of
$394,000, $488,000 and $271,000 for 1999, 1998 and 1997, respectively,
are included in loan income and represent an adjustment of the yield on
these loans.
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WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
IN THOUSANDS, EXCEPT INTEREST RATES
------------------------------------------------------------------------------------------------
1999 1998 1999/1998 CHANGE
-------------------------------- ----------------------------- ------------------------------
Average Interest Income/ Average Interest Income/ Due to Due to
Balance Rate Expense Balance Rate Expense Volume Rate Total
--------------------------------- ----------------------------- ------------------------------
Loans, net of unearned interest $ 326,396 8.87% 28,937 263,605 9.40% 24,790 5,902 (1,755) 4,147
Investment securities - taxable 66,096 6.61 4,371 52,371 6.64 3,480 911 (20) 891
Investment securities -
tax exempt 15,758 5.27 830 20,356 5.53 1,126 (254) (42) (296)
Taxable equivalent adjustment -- 2.72 428 -- 2.85 580 (131) (21) (152)
------------------------------- --------------------------- -------
Total tax-exempt
investment securities 15,758 7.99 1,258 20,356 8.38 1,706 (385) (63) (448)
------------------------------- --------------------------- -------
Total investment securities 81,854 6.88 5,629 72,727 7.13 5,186 651 (208) 443
------------------------------- --------------------------- -------
Loans held for sale 2,270 5.64 128 3,534 6.20 219 (78) (13) (91)
Federal funds sold 20,151 4.60 927 26,113 5.11 1,335 (305) (103) (408)
------------------------------- --------------------------- -------
Total earning assets 430,671 8.27 35,621 365,979 8.62 31,530 5,576 (1,485) 4,091
------------------------------- --------------------------- -------
Cash and due from banks 13,019 11,041
Allowance for possible loan
losses (3,573) (3,170)
Bank premises and equipment 15,274 13,110
Other assets 6,612 4,856
------------ -----------
Total assets $ 462,003 391,816
============ ===========
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WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
IN THOUSANDS, EXCEPT INTEREST RATES
---------------------------------------------------------------------------------------------------
1999 1998 1999/1998 CHANGE
----------------------------- ------------------------------ ------------------------------
Average Interest Income/ Average Interest Income/ Due to Due to
Balance Rate Expense Balance Rate Expense Volume Rate Total
----------------------------- ------------------------------ ------------------------------
Deposits:
Negotiable order of
withdrawal accounts $ 25,287 1.61% 406 21,821 1.94% 423 67 (84) (17)
Money market demand
accounts 89,737 3.47 3,117 72,828 3.79 2,758 640 (281) 359
Individual retirement
accounts 19,444 5.46 1,061 16,530 5.68 939 165 (43) 122
Other savings deposits 20,867 4.07 850 18,225 4.57 833 121 (104) 17
Certificates of deposit
$100,000 and over 80,567 5.34 4,301 66,993 5.82 3,902 790 (391) 399
Certificates of deposit
under $100,000 135,085 5.41 7,312 117,296 5.76 6,760 1,025 (473) 552
------------------------------ ------------------------------- ---------
Total interest-bearing
deposits 370,987 4.60 17,047 313,693 4.98 15,615 2,853 (1,421) 1,432
Demand 44,246 -- -- 36,513 -- -- --
------------------------------ ------------------------------- ---------
Total deposits 415,233 4.11 17,047 350,206 4.46 15,615 2,900 (1,468) 1,432
------------------------------ ------------------------------- ---------
Securities sold under
repurchase agreements 9,374 4.35 408 8,503 4.54 386 39 (17) 22
Federal funds purchased 48 4.17 2 54 3.70 2 -- -- --
------------------------------ ------------------------------- ---------
Total deposits and
borrowed funds 424,655 4.11 17,457 358,763 4.46 16,003 2,939 1,485 1,454
------------------------------ ------------------------------- ---------
Other liabilities 6,788 6,118
Stockholders' equity 30,560 26,935
-------- --------
Total liabilities and
stockholders' equity $462,003 391,816
======== ========
Net interest income 18,164 15,527
====== ======
Net yield on earning assets 4.22% 4.24%
==== ====
Net interest spread 4.16% 4.16%
==== ====
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WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
IN THOUSANDS, EXCEPT INTEREST RATES
---------------------------------------------------------------------------------------------------
1998 1997 1998/1997 CHANGE
-------------------------------- -------------------------------- -------------------------------
Average Interest Income/ Average Interest Income/ Due to Due to
Balance Rate Expense Balance Rate Expense Volume Rate Total
---------- -------- ------- --------- -------- -------- -------- -------- --------
Loans, net of unearned interest $263,605 9.40% 24,790 215,073 9.52% 20,466 4,620 (296) 4,324
Investment securities - taxable 52,371 6.64 3,480 38,609 6.36 2,457 875 148 1,023
Investment securities -
tax exempt 20,356 5.53 1,126 20,346 5.73 1,166 1 (41) (40)
Taxable equivalent adjustment -- 2.85 580 -- 2.95 600 -- (20) (20)
------------------------------ ------------------------------ --------
Total tax-exempt
investment securities 20,356 8.38 1,706 20,346 8.68 1,766 1 (61) (60)
------------------------------ ------------------------------ --------
Total investment securities 72,727 7.13 5,186 58,955 7.16 4,223 986 (23) 963
------------------------------ ------------------------------ --------
Loans held for sale 3,534 6.20 219 2,062 5.38 111 79 29 108
Federal funds sold 26,113 5.11 1,335 18,356 5.13 941 398 (4) 394
------------------------------ ------------------------------ --------
Total earning assets 365,979 8.62 31,530 294,446 8.74 25,741 6,252 (463) 5,789
------------------------------ ------------------------------ --------
Cash and due from banks 11,041 8,943
Allowance for possible loan
losses (3,170) (2,730)
Bank premises and equipment 13,110 10,855
Other assets 4,856 4,113
---------- ---------
Total assets $391,816 315,627
========== =========
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WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
IN THOUSANDS, EXCEPT INTEREST RATES
---------------------------------------------------------------------------------------------------
1998 1997 1998/1997 CHANGE
-------------------------------- -------------------------------- --------------------------------
Average Interest Income/ Average Interest Income/ Due to Due to
Balance Rate Expense Balance Rate Expense Volume Rate Total
----------------------------- ----------------------------- --------------------------------
Deposits:
Negotiable order of
withdrawal accounts $ 21,821 1.94% 423 23,232 2.22% 515 (31) (61) (92)
Money market demand
accounts 72,828 3.79 2,758 54,222 3.82 2,069 711 22 689
Individual retirement 16,530 5.68 939 13,765 5.72 787 159 7 152
accounts
Other savings deposits 18,225 4.57 833 12,766 4.57 583 250 -- 250
Certificates of deposit
$100,000 and over 66,993 5.82 3,902 51,315 5.76 2,957 903 42 945
Certificates of deposit
under $100,000 117,296 5.76 6,760 95,813 5.65 5,411 1,214 135 1,349
---------------------------- ---------------------------- --------
Total interest-bearing
deposits 313,693 4.98 15,615 251,113 4.91 12,322 3,073 220 3,293
Demand 36,513 -- -- 28,865 -- -- --
---------------------------- ---------------------------- --------
Total deposits 350,206 4.46 15,615 279,978 4.40 12,322 3,090 203 3,293
---------------------------- ---------------------------- --------
Securities sold under
repurchase agreements 8,503 4.54 386 7,326 4.82 353 57 (24) 33
Federal funds purchased 54 3.70 2 -- -- -- 2 -- 2
---------------------------- ---------------------------- --------
Total deposits and
borrowed funds 358,763 4.46 16,003 287,304 4.41 12,675 3,151 177 3,328
---------------------------- ---------------------------- --------
Other liabilities 6,118 5,458
Stockholders' equity 26,935 22,865
-------- ------
Total liabilities and
stockholders' equity $391,816 315,627
======== =======
Net interest income 15,527 13,066
========= ========
Net yield on earning assets 4.24% 4.44%
==== ====
Net interest spread 4.16% 4.33%
==== ====
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WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
II. Investment Portfolio:
A. Securities at December 31, 1999 consist of the following:
SECURITIES HELD-TO-MATURITY
------------------------------------------------------------------
(In Thousands)
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
------------- ------------- ------------- -------------
Obligations of state and
political subdivisions $ 13,398 59 298 13,159
Mortgage-backed securities 3,339 14 37 3,316
------------- ------------- ------------- -------------
$ 16,737 73 335 16,475
============= ============= ============= =============
SECURITIES AVAILABLE-FOR-SALE
------------------------------------------------------------------
(In Thousands)
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
------------- ------------- ------------- -------------
U.S. Treasury and other
U.S. Government agencies
and corporations $ 66,859 1 2,882 63,978
Obligations of state and
political subdivisions 2,232 13 8 2,237
Mortgage-backed securities 840 2 14 828
------------- ------------- ------------- -------------
$ 69,931 16 2,904 67,043
============= ============= ============= =============
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WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
II. Investment Portfolio, Continued:
A. Continued
Investment securities at December 31, 1998 consist of the
following:
SECURITIES HELD-TO-MATURITY
------------------------------------------------------------------
(In Thousands)
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
------------- ------------- ------------- -------------
U.S. Treasury and other
U.S. Government agencies
and corporations $ 1,097 7 -- 1,104
Obligations of state and
political subdivisions 15,202 479 -- 15,681
Mortgage-backed securities 4,109 15 39 4,085
------------- ------------- ------------- -------------
$ 20,408 501 39 20,870
============= ============= ============= =============
SECURITIES AVAILABLE-FOR-SALE
------------------------------------------------------------------
(In Thousands)
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
------------- ------------- ------------- -------------
U.S. Treasury and other
U.S. Government agencies
and corporations $ 49,189 283 43 49,429
Obligations of state and
political subdivisions 2,732 91 -- 2,823
Mortgage-backed securities 922 7 1 928
------------- ------------- ------------- -------------
$ 52,843 381 44 53,180
============= ============= ============= =============
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WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
II. Investment Portfolio, Continued:
B. The following schedule details the estimated maturities and
weighted average yields of investment securities (including
mortgage backed securities) of the Company at December 31, 1999.
Estimated Weighted
Amortized Market Average
Held-To-Maturity Securities Cost Value Yields
------------- -------------- ----------------
(In Thousands, Except Yields)
U.S. Treasury and other U.S. Government
agencies and corporations, including
mortgage-backed securities:
Less than one year $ 147 147 6.10%
One to five years 4 4 10.00
Five to ten years 2,487 2,461 7.04
More than ten years 701 704 6.31
------------- -------------- ----------------
Total securities of U.S. Treasury
and other U.S. Government
agencies and corporations 3,339 3,316 6.85
------------- -------------- ----------------
Obligations of states and political subdivisions*:
Less than one year 1,521 1,527 8.56
One to five years 3,228 3,252 6.40
Five to ten years 4,503 4,444 6.41
More than ten years 4,146 3,936 5.67
------------- -------------- ----------------
Total obligations of states and
political subdivisions 13,398 13,159 6.42
------------- -------------- ----------------
Total investment securities $ 16,737 16,475 6.51%
============= ============== ================
* Weighted average yield is stated on a tax-equivalent basis, assuming a
weighted average Federal income tax rate of 34%.
12
14
WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
II. Investment Portfolio, Continued:
B. Continued
Estimated Weighted
Amortized Market Average
Available-For-Sale Securities Cost Value Yields
------------- -------------- ----------------
(In Thousands, Except Yields)
U.S. Treasury and other U.S. Government
agencies and corporations, including
mortgage-backed securities:
Less than one year $ 2,596 2,589 5.89%
One to five years 6,600 6,451 6.61
Five to ten years 50,952 48,520 6.37
More than ten years 6,396 6,091 7.10
------------- -------------- ----------------
Total securities of U.S. Treasury
and other U.S. Government
agencies and corporations 66,544 63,651 6.39
------------- -------------- ----------------
Obligations of states and political subdivisions*:
Less than one year 577 581 6.98
One to five years 989 986 4.71
Five to ten years 467 472 5.50
More than ten years 199 198 5.62
------------- -------------- ----------------
Total obligations of states and
political subdivisions 2,232 2,237 5.54
------------- -------------- ----------------
Other:
Federal Home Loan Bank stock 1,155 1,155 6.91
------------- -------------- ----------------
Total investment securities $ 69,931 67,043 6.38%
============= ============== ================
* Weighted average yield is stated on a tax-equivalent basis, assuming a
weighted average Federal income tax rate of 34%.
13
15
WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
III. Loan Portfolio:
A. Loan Types
The following schedule details the loans of the Company at
December 31, 1999, 1998, 1997, 1996 and 1995.
In Thousands
---------------------------------------------------------------------------------
1999 1998 1997 1996 1995
------------- ------------- ------------- ------------- -------------
Commercial, financial and
agricultural $ 121,438 100,217 82,515 57,449 55,081
Real estate - construction 27,184 21,809 18,159 16,828 9,022
Real estate - mortgage 164,852 130,927 103,155 80,955 62,349
Installment 45,710 44,299 38,423 32,558 23,615
------------- ------------- ------------- ------------- -------------
Total loans 359,184 297,252 242,252 187,790 150,067
Less unearned interest (579) (1,322) (1,696) (1,696) (1,385)
------------- ------------- ------------- ------------- -------------
Total loans, net of
unearned interest 358,605 295,930 240,556 186,094 148,682
Less allowance for
possible loan losses (3,847) (3,244) (2,890) (2,452) (1,944)
------------- ------------- ------------- ------------- -------------
Net loans $ 354,758 292,686 237,666 183,642 146,738
============= ============= ============= ============= =============
14
16
WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
III. Loan Portfolio, Continued:
B. Maturities and Sensitivities of Loans to Changes in Interest
Rates
The following schedule details maturities and sensitivity to
interest rates changes for commercial loans of the Company at
December 31, 1999.
1 Year to
Less Than Less Than After 5
1 Year 5 Years Years Total
------------- ------------- ------------- -------------
Maturity Distribution:
Commercial, financial
and agricultural $ 63,808 35,480 22,150 121,438
Real estate - construction 25,754 159 1,271 27,184
------------- ------------- ------------- -------------
$ 89,562 35,639 23,421 148,622
============= ============= ============= =============
Interest-Rate Sensitivity:
Fixed interest rates $ 81,878 24,425 9,064 115,367
Floating or adjustable
interest rates 7,684 11,214 14,357 33,255
------------- ------------- ------------- -------------
Total commercial,
financial and
agricultural loans
plus real estate -
construction loans $ 89,562 35,639 23,421 148,622
============= ============= ============= =============
*Includes demand loans, bankers acceptances, commercial paper and deposit notes.
15
17
WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
III. Loan Portfolio, Continued:
C. Risk Elements
The following schedule details selected information as to
non-performing loans of the Company at December 31, 1999, 1998,
1997, 1996 and 1995.
In Thousands, Except Percentages
-----------------------------------------------------
1999 1998 1997 1996 1995
-------- ------- ------- ------- -------
Non-accrual loans:
Commercial, financial and
agricultural $ -- -- 1 24 4
Real estate -
construction -- -- -- -- --
Real estate - mortgage -- 25 6 59 --
Installment 84 198 153 177 113
Lease financing
receivable -- -- -- -- --
-------- ------- ------- ------- -------
Total non-accrual $ 84 223 160 260 117
======== ======= ======= ======= =======
Loans 90 days past due:
Commercial, financial and
agricultural $ -- -- 30 80 8
Real estate -
construction -- -- -- -- --
Real estate - mortgage 197 118 66 344 --
Installment 225 438 1,123 370 163
Lease financing
receivable -- -- -- -- --
-------- ------- ------- ------- -------
Total loans 90 days
past due $ 422 556 1,219 794 171
======== ======= ======= ======= =======
Renegotiated loans:
Commercial, financial and
agricultural $ -- -- -- -- --
Real estate -
construction -- -- -- -- --
Real estate - mortgage -- -- -- -- --
Installment -- -- -- -- --
Lease financing
receivable -- -- -- -- --
-------- ------- ------- ------- -------
Total renegotiated
loans past due $ -- -- -- -- --
======== ======= ======= ======= =======
Loans current - considered
uncollectible $ -- -- -- -- --
======== ======= ======= ======= =======
Total non-performing
loans $ 506 779 1,379 1,054 288
======== ======= ======= ======= =======
Total loans, net of
unearned interest $358,605 295,930 240,556 186,094 148,682
======== ======= ======= ======= =======
Percent of total
loans outstanding,
net of unearned
interest 0.14% 0.26 0.57 0.57 .19
======== ======= ======= ======= =======
Other real estate $ 221 138 63 -- --
======== ======= ======= ======= =======
16
18
WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
III. Loan Portfolio, Continued:
C. Risk Elements, Continued
The accrual of interest income is discontinued when it is
determined that collection of interest is less than probable or
the collection of any amount of principal is doubtful. The
decision to place a loan on a non-accrual status is based on an
evaluation of the borrower's financial condition, collateral
liquidation value, economic and business conditions and other
factors that affect the borrower's ability to pay. At the time a
loan is placed on a non-accrual status, the accrued but unpaid
interest is also evaluated as to collectibility. If
collectibility is doubtful, the unpaid interest is charged off.
Thereafter, interest on non-accrual loans is recognized only as
received. Non-accrual loans totaled $84,000 at December 31,
1999, $223,000 at December 31, 1998, $160,000 at December 31,
1997, $260,000 at December 31, 1996 and $117,000 at December 31,
1995. Gross interest income on non-accrual loans, that would
have been recorded for the year ended December 31, 1999 if the
loans had been current totaled $8,000 as compared to $16,000 in
1998, $11,000 in 1997, $12,000 in 1996 and $7,000 in 1995. The
amount of interest income recognized on total loans during 1999
totaled $28,937,000 as compared to $24,790,000 in 1998,
$20,466,000 in 1997, $15,725,000 in 1996 and $12,763,000 in
1995.
At December 31, 1999, loans, which include the above, totaling
$738,000 were included in the Company's internal classified loan
list. Of these loans $388,000 are real estate and $350,000 are
various other types of loans. The collateral values securing
these loans total approximately $849,000, ($558,000 related to
real property and $291,000 related to the various other types of
loans). Such loans are listed as classified when information
obtained about possible credit problems of the borrowers has
prompted management to question the ability of the borrower to
comply with the repayment terms of the loan agreement. The loan
classifications do not represent or result from trends or
uncertainties which management expects will materially impact
future operating results, liquidity or capital resources.
At December 31, 1999 there were no loan concentrations that
exceeded ten percent of total loans other than as included in
the preceding table of types of loans. Loan concentrations are
amounts loaned to a multiple number of borrowers engaged in
similar activities which would cause them to be similarly
impacted by economic or other conditions.
At December 31, 1999 and 1998 other real estate totaled $221,000
and $138,000, respectively.
17
19
WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
III. Loan Portfolio, Continued:
C. Risk Elements, Continued
There were no material amounts of other interest-bearing assets
(interest-bearing deposits with other banks, municipal bonds,
etc.) at December 31, 1999 which would be required to be
disclosed as past due, non-accrual, restructured or potential
problem loans, if such interest-bearing assets were loans.
18
20
WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
IV. Summary of Loan Loss Experience:
The following schedule details selected information related to the
allowance for possible loan loss account of the Company at December 31,
1999, 1998, 1997, 1996 and 1995 and the years then ended.
In Thousands, Except Percentages
-----------------------------------------------------------------
1999 1998 1997 1996 1995
--------- ------- ------- ------- -------
Allowance for loan losses
at beginning of period $ 3,244 2,890 2,452 1,944 1,556
--------- ------- ------- ------- -------
Less: net of loan
charge-offs:
Charge-offs:
Commercial, financial and
agricultural -- -- -- (1) (87)
Real estate construction -- -- -- -- --
Real estate - mortgage (50) (100) (9) -- --
Installment (539) (605) (477) (173) (78)
Lease financing -- -- -- -- --
--------- ------- ------- ------- -------
(589) (705) (486) (174) (165)
--------- ------- ------- ------- -------
Recoveries:
Commercial, financial and
agricultural -- -- -- -- --
Real estate construction -- -- -- -- --
Real estate - mortgage -- 2 -- -- --
Installment 89 47 96 17 26
Lease financing -- -- -- -- --
--------- ------- ------- ------- -------
89 49 96 17 26
--------- ------- ------- ------- -------
Net loan charge-offs (500) (656) (390) (157) (139)
--------- ------- ------- ------- -------
Provision for loan losses
charged to expense 1,103 1,010 828 665 527
--------- ------- ------- ------- -------
Allowance for loan losses at
end of period $ 3,847 3,244 2,890 2,452 1,944
========= ======= ======= ======= =======
Total loans, net of unearned
interest, at end of year $ 358,605 295,930 240,556 186,094 148,682
========= ======= ======= ======= =======
Average total loans out-
standing, net of unearned
interest, during year $ 326,396 263,605 215,073 165,807 134,552
========= ======= ======= ======= =======
Net charge-offs as a
percentage of average total
loans outstanding, net of
unearned interest, during
year 0.15% 0.25 0.18 0.09 .10
========= ======= ======= ======= =======
Ending allowance for loan
losses as a percentage of
total loans outstanding net
of unearned interest, at
end of year 1.07% 1.10 1.20 1.32 1.31
========= ======= ======= ======= =======
19
21
WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
IV. Summary of Loan Loss Experience, Continued:
The allowance for possible loan losses is an amount that management
believes will be adequate to absorb possible losses on existing loans
that may become uncollectible. The provision for possible loan losses
charged to operating expense is based on past loan loss experience and
other factors which, in management's judgment, deserve current
recognition in estimating possible loan losses. Such other factors
considered by management include growth and composition of the loan
portfolio, review of specific loan problems, the relationship of the
allowance for possible loan losses to outstanding loans, adverse
situations that may affect the borrower's ability to repay, the
estimated value of any underlying collateral and current economic
conditions that may affect the borrower's ability to pay.
Management conducts a continuous review of all loans that are
delinquent, previously charged down or loans which are determined to be
potentially uncollectible. Loan classifications are reviewed
periodically by a person independent of the lending function. The Board
of Directors periodically reviews the adequacy of the allowance for
possible loan losses.
The following detail provides a breakdown of the allocation of the
allowance for possible loan losses:
December 31, 1999 December 31, 1998
------------------------------- --------------------------------
Percent of Percent of
Loans In Loans In
In Each Category In Each Category
Thousands To Total Loans Thousands To Total Loans
------------ --------------- ------------ ----------------
Commercial, financial
and agricultural $ 463 33.8% $ 396 33.7%
Real estate construction 232 7.6 184 7.3
Real estate mortgage 2,171 45.9 1,785 44.1
Installment 981 12.7 879 14.9
------------ --------------- ------------ ----------------
$ 3,847 100.0% $ 3,244 100.0%
============ =============== ============ ================
December 31, 1997 December 31, 1996
------------------------------- --------------------------------
Percent of Percent of
Loans In Loans In
In Each Category In Each Category
Thousands To Total Loans Thousands To Total Loans
------------ --------------- ------------ ----------------
Commercial, financial
and agricultural $ 483 34.1% $ 357 30.6%
Real estate construction 249 7.5 217 9.0
Real estate mortgage 1,552 42.6 1,348 43.1
Installment 606 15.8 530 17.3
------------ --------------- ------------ ----------------
$ 2,890 100.0% $ 2,452 100.0%
============ =============== ============ ================
December 31, 1995
-------------------------------
Percent of
Loans In
In Each Category
Thousands To Total Loans
------------ ---------------
Commercial, financial
and agricultural $ 801 36.7%
Real estate construction 283 6.0
Real estate mortgage 566 41.5
Installment 294 15.8
------------ ---------------
$ 1,944 100.0%
============ ===============
20
22
WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
V. Deposits:
The average amounts and average interest rates for deposits for 1999
and 1998 are detailed in the following schedule:
1999 1998
--------------------------------- ---------------------------------
Average Average
Balance Balance
--------------- Average --------------- Average
In Thousands Rate In Thousands Rate
--------------- -------------- --------------- -------------
Non-interest bearing deposits $ 44,246 -- % 36,513 -- %
Negotiable order of
withdrawal accounts 25,287 1.61% 21,821 1.94%
Money market demand
accounts 89,737 3.47% 72,828 3.79%
Individual retirement
accounts 19,444 5.46% 16,530 5.68%
Other savings 20,867 4.07% 18,225 4.57%
Certificates of deposit
$100,000 and over 80,567 5.34% 66,993 5.82%
Certificates of deposit under
$100,000 135,085 5.41% 117,296 5.76%
--------------- -------------- --------------- -------------
$ 415,233 4.11% 350,206 4.46%
=============== ============== =============== =============
The following schedule details the maturities of certificates of
deposit and individual retirement accounts of $100,000 and over at
December 31, 1999.
In Thousands
----------------------------------------------------
Certificates Individual
of Retirement
Deposit Accounts Total
--------------- --------------- -------------
Less than three months $ 27,977 166 28,143
Three to six months 24,110 1,004 25,114
Six to twelve months 22,438 3,114 25,552
More than twelve months 10,890 923 11,813
--------------- --------------- -------------
$ 85,415 5,207 90,622
=============== =============== =============
21
23
WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
VI. Return on Equity and Assets:
The following schedule details selected key ratios of the Company at
December 31, 1999, 1998, and 1997.
1999 1998 1997
--------------- --------------- -------------
Return on assets (1) 1.12% 1.18% 1.17%
(Net income divided by average total assets)
Return on equity 16.04% 16.72% 16.02%
(Net income divided by average equity)
Dividend payout ratio 29.76% 27.00% 28.43%
(Dividends declared per share divided by
net income per share) (2)
Equity to asset ratio 6.61% 6.87% 7.24%
(Average equity divided by average total
assets)
Leverage capital ratio 7.76% 7.78% 8.21%
(Equity divided by fourth quarter
average total assets, excluding the net
unrealized loss on available-for-sale
securities and including minority interest)
The minimum leverage capital ratio required by the regulatory agencies
is 4%.
Beginning January 1, 1991, new risk-based capital guidelines were
adopted by regulatory agencies. Under these guidelines, a credit risk
is assigned to various categories of assets and commitments ranging
from 0% to 100% based on the risk associated with the asset.
(1) Includes minority interest earnings of consolidated subsidiaries.
(2) Per share data has been retroactively adjusted to reflect a 4 for 3
stock split which occurred effective September 30, 1999.
22
24
WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
VI. Return on Equity and Assets, Continued:
The following schedule details the Company's risk-based capital at
December 31, 1999 excluding the net unrealized loss on
available-for-sale securities which is shown as a deduction in
stockholders' equity in the consolidated financial statements:
In Thousands
-----------------
Tier I capital:
Stockholders' equity, excluding the net unrealized
loss on available-for-sale securities $ 33,866
Add: Minority interest (limited to 25% of Tier I
capital) 3,668
-----------------
Total Tier I capital 37,534
Total capital:
Allowable allowance for loan losses (limited to 1.25%
of risk-weighted assets) 3,847
-----------------
Total capital $ 41,381
=================
Risk-weighted assets $ 345,200
=================
Risk-based capital ratios:
Tier I capital ratio 10.87%
=================
Total risk-based capital ratio 11.99%
=================
23
25
WILSON BANK HOLDING COMPANY
Form 10-K
December 31, 1999
VI. Return on Equity and Assets, Continued:
The Company is required to maintain a Total capital to risk-weighted
asset ratio of 8% and a Tier I capital to risk-weighted asset ratio of
4%. At December 31, 1999, the Company and its subsidiary banks were in
compliance with these requirements.
The following schedule details the Company's interest rate sensitivity
at December 31, 1999:
Repricing Within
-----------------------------------------------------------------------------------------------
(In Thousands) Total 0-30 Days 31-90 Days 91-180 Days 181-365 Days Over 1 Year
-------- --------- ---------- ----------- ------------ ------------
Earning assets:
Loans, net of
unearned interest $358,605 151,967 14,221 28,848 44,619 118,950
Securities 83,780 4,414 1,632 1,037 2,506 74,191
Loans held for sale 1,835 1,835 -- -- -- --
Federal funds sold 13,928 13,928 -- -- -- --
-------- -------- ------- -------- ------- -------
Total earning
assets 458,148 172,144 15,853 29,885 47,125 193,141
-------- -------- ------- -------- ------- -------
Interest-bearing
liabilities:
Negotiable order
of withdrawal
accounts 26,346 26,346 -- -- -- --
Money market demand
accounts 99,456 99,456 -- -- -- --
Individual retirement
accounts 20,774 6,197 1,284 2,800 5,643 4,850
Other savings 21,610 21,610 -- -- -- --
Certificates of
deposit,
$100,000 and over 85,415 2,875 25,101 24,110 22,438 10,891
Certificates of
deposit,
under $100,000 149,760 1,892 32,196 36,113 49,631 29,928
Securities sold
under repurchase
agreements 8,543 8,543 -- -- -- --
-------- -------- ------- -------- ------- -------
411,904 166,919 58,581 63,023 77,712 45,669
-------- -------- ------- -------- ------- -------
Interest-sensitivity
gap $ 46,244 5,225 (42,728) (33,138) (30,587) 147,472
======== ======== ======= ======== ======= =======
Cumulative gap 5,225 (37,503) (70,641) (101,228) 46,244
======== ======= ======== ======== =======
Interest-sensitivity
gap as % of total assets 1.06 (8.63) (6.69) (6.18) 29.78
======== ======= ======== ======= =======
Cumulative gap as %
of total assets 1.06 (7.57) (14.26) (20.44) 9.34
======== ======= ======== ======= =======
The Company presently maintains a liability sensitive position over the
next twelve months. However, management expects that liabilities of a
demand nature will renew and that it will not be necessary to replace
them with significantly higher cost funds.
24
26
ITEM 2. DESCRIPTION OF PROPERTY
The Company's main office is owned by the Company and consists of approximately
four acres at 623 West Main Street, Lebanon, Tennessee. The building is a two
story, brick building, with approximately 35,000 square feet. The lot has
approximately 350 feet of road frontage on West Main Street. In addition
thereto, the Bank has ten branch locations located at 1444 Baddour Parkway,
Lebanon, Tennessee; 200 Tennessee Boulevard, Lebanon, Tennessee; 8875 Stewart's
Ferry Pike, Gladeville, Tennessee; Public Square, Watertown, Tennessee; 1476
North Mt. Juliet Road, Mt. Juliet, Tennessee; 1130 Castle Heights Avenue North,
Lebanon, Tennessee; 127 McMurry Blvd., Hartsville, Tennessee; the Wal-Mart
Supercenter, Lebanon, Tennessee; and 4736 Andrew Jackson Parkway in Hermitage,
Tennessee.
The Mt. Juliet office contains approximately 16,000 square feet of space; the
new Castle Heights Office contains 2,400 square feet of space and the new
Hartsville Office contains 8,000 square feet of space. The Hermitage branch
opened in the fall of 1999 and contains 8,000 square feet of space. The
Gladeville branch expanded its office building with new office space opening
December 6, 1998. The Gladeville branch now contains approximately 3,400 square
feet of space. The Lebanon facility at Tennessee Boulevard was expanded in 1997
to 2,200 square feet of space. Each of the branch facilities of the Bank not
otherwise described above contains approximately 1,000 square feet of space. The
Bank owns all of its branch facilities except for the Lebanon facility at
Tennessee Boulevard and its space in the Wal-mart Supercenter, which are leased.
The Bank also leases space at five locations within Wilson County where it
maintains and operates automatic teller machines.
DCB has a bank facility at 576 West Broad Street in Smithville, Tennessee
containing approximately 6,800 square feet of space and a bank facility at 306
Brush Creek Road in Alexandria, Tennessee which occupies approximately 2,400
square feet of space. DCB owns both facilities. This serves as the main office
for DCB. CBSC recently replaced its one and only banking facility with a new
office building it owns at 1300 Main Street North, Carthage, Tennessee. CBSC's
new facility contains approximately 8,000 square feet of space.
ITEM 3. LEGAL PROCEEDINGS
There were no material legal proceedings pending at December 31, 1999, against
the Company, the Bank, DCB or CBSC.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders in the fourth quarter of
1999.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS
Information required by this item is contained under the heading "Wilson Bank
Holding Company Common Stock Market Information" on page 60 of the Company's
1999 Annual Report and is incorporated herein by reference.
ITEM 6. SELECTED FINANCIAL DATA
Information required by this item is contained under the heading "Wilson Bank
Holding Company Financial Highlights (Unaudited)" on page 9 of the Company's
1999 Annual Report and is incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Information required by this item is contained under the heading "Management's
Discussion and Analysis of Financial Condition and Results of Operations" as set
forth on pages 10 through 20 of the Company's 1999 Annual Report and is
incorporated herein by reference.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company's primary component of market risk is interest rate volatility.
Fluctuations in interest rates will ultimately impact both the level of income
and expense recorded on a large portion of the Company's assets and liabilities,
and the market value of all interest-earning assets and interest-bearing
liabilities, other than those which possess a short term to maturity. Based upon
the nature of the Company's operations, the Company is not subject to foreign
currency exchange or commodity price risk.
Interest rate risk (sensitivity) management focuses on the earnings risk
associated with changing interest rates. Management seeks to maintain
profitability in both immediate and long term earnings through funds
management/interest rate risk management. The Company's rate sensitivity
position has an important impact on earnings. Senior Management of the Company
meets monthly to analyze the rate
25
27
sensitivity position. These meetings focus on the spread between the cost of
funds and interest yields generated primarily through loans and investments.
The following table provides information about the Company's financial
instruments that are sensitive to changes in interest rates as of December 31,
1999.
(DOLLARS IN THOUSANDS)
EXPECTED MATURITY DATE - YEAR ENDING DECEMBER 31,
---------------------------------------------------------------- FAIR
2000 2001 2002 2003 2004 Thereafter TOTAL VALUE
EARNING ASSETS:
Loans, net of unearned
interest:
Variable rate $ 75,596 11,015 15,780 8,694 6,765 22,265 140,115 140,115
Average interest rate 8.61% 8.35% 8.44% 8.44% 7.71% 7.72% 8.40%
Fixed rate 109,905 27,015 20,187 18,175 16,115 27,093 218,490 215,185
Average interest rate 8.81% 8.59% 9.31% 8.28% 7.94% 7.79% 8.52%
Securities 4,745 1,390 1,700 2,244 7,285 66,416 83,780 83,518
Average interest rate 7.17% 6.32% 6.60% 7.41% 6.54% 6.70% 6.70%
Loans held for sale 1,835 -- -- -- -- -- 1,835 1,835
Average interest rate 5.64% -- -- -- -- -- 5.64%
Federal funds sold 13,928 -- -- -- -- -- 13,928 13,928
Average interest rate 4.60% -- -- -- -- -- 4.60%
Interest-bearing deposits 354,893 37,099 10,483 320 566 -- 403,361 403,970
Average interest rate 4.18% 5.63% 5.92% 5.87% 6.05% -- 4.29%
Short-term borrowings 8,543 -- -- -- -- -- 8,543 8,543
Average interest rate 4.35% -- -- -- -- -- 4.35%
ITEM 8. FINANCIAL STATEMENTS
The consolidated financial statements and the independent auditors report of
Maggart & Associates, P.C. required by this item are contained in pages 21
through 57 and on page 21, respectively, of the Company's 1999 Annual Report and
are incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information required by this item with respect to directors is incorporated
by reference herein by reference to "Election of Directors" in the Company's
Proxy Statement. The information required by this item with respect to executive
officers is set forth below:
James Randall Clemons (47) - Mr. Clemons is President and Chief
Executive Officer of the Company and the Bank. Mr. Clemons also serves
on the Board of Directors of the Company and the Bank. He has held such
positions with the Company since its formation in March 1992 and has
held his Bank positions since the Bank commenced operations in May
1987. Prior to that time, Mr. Clemons served as Senior Vice President
and Cashier for Peoples Bank, Lebanon, Tennessee.
Becky Taylor (55) - Ms. Taylor is the principal accounting officer of
the Company and a Senior Vice-President and Cashier of the Bank. She
has served as Vice President and Cashier of the Bank since May 1987 and
as the principal accounting officer
26
28
of the Company since its formation in March 1992. She has held her
positions with the Bank since it commenced operations. From 1963 to
1987, Ms. Taylor was employed by Lebanon Bank, Lebanon, Tennessee,
where her duties included Data Processing Coordinator, Auditor,
Security Officer and Compliance Officer. Ms. Taylor held the title of
Vice President and Cashier of Lebanon Bank.
Elmer Richerson (47) - Mr. Richerson joined the Bank in February 1989.
Prior to such time, Mr. Richerson was the manager of the Lebanon branch
of Heritage Federal Savings and Loan Association from March 1988 to
February 1989. From September 1986 until March 1988, Mr. Richerson was
a liquidation assistant for the Federal Deposit Insurance Corporation.
Mr. Richerson serves as an Executive Vice President and Senior Loan
Officer of the Bank and oversees the branch administration for the
Bank. Mr. Richerson also serves on the Board of Directors of the Bank
and in 1998 was appointed to serve on the Board of Directors of the
Company as well.
Larry Squires (47) - Mr. Squires joined the Bank in 1989 and is
currently Senior Vice President and Investment Officer. Prior to that
time Mr. Squires was Vice President of Liberty State Bank in Lebanon.
His principal duty is overseeing the Bank's investment and brokerage
center.
Gary Whitaker (42) - Mr. Whitaker joined the Bank in May 1996. Prior to
that time Mr. Whitaker was employed with NationsBank of Tennessee, N.A.
in Nashville (and its predecessors) from 1979. He has held positions in
collections, as branch manager, in construction lending, retail
marketing, automobile lending, loan administration, operations analyst,
as Vice President and most recently Senior Vice President. His
principal duties include overseeing the Bank's lending function and
loan operations.
David Boudreaux (36) - Mr. Boudreaux joined the Bank in June of 1996
and is currently Senior Vice President. Mr. Boudreaux is the manager of
the Mt. Juliet Office and is responsible for the operation of two other
branch locations. Prior to that time, Mr. Boudreaux was Vice President
and Commercial Loan Officer with Hibernia National Bank in Houma,
Thibodaux, LA.
Mike Baker (38) - Mr. Baker is Senior Vice President in charge of the
Main Office of Wilson Bank and Trust. Mr. Baker joined the bank in
November of 1991. Prior to that time he was Asst. Vice President and
Loan Officer at Sun Trust, Lebanon, Tennessee.
Lisa Sorrell (35) - Ms. Sorrell is Senior Vice President and the Chief
Financial Office of Wilson Bank and Trust. Ms. Sorrell has held several
positions including Asst. Cashier, Asst. Vice President and Vice
President since the bank's formation in May of 1987. Prior to 1987 Ms.
Sorrell was employed by People's Bank, Lebanon, TN 37087.
All officers serve at the pleasure of the Board of Directors. No officers are
involved in any legal proceedings which are material to an evaluation of their
ability and integrity.
ITEM 11. EXECUTIVE COMPENSATION
Information required by this item is contained under the caption "Executive
Compensation" in the Company's Proxy Statement and is incorporated herein by
reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Information required by this item is contained under the caption "Security
Ownership of Certain Beneficial Owners and Management" in the Company's Proxy
Statement and is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information required by this item is contained under the caption "Certain
Relationships and Related Transactions" in the Company's Proxy Statement and is
incorporated herein by reference.
27
29
PART IV
ITEM 14. EXHIBITS AND REPORTS ON FORM 8-K
(a)(1) Financial Statements. See Item 8.
(a)(2) Financial Statement Schedules. Inapplicable.
(a)(3) Exhibits. See Index to Exhibits.
(b) Reports on Form 8-K
None.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
28
30
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
WILSON BANK HOLDING COMPANY
By: /s/ J. Randall Clemons
---------------------------------------
J. Randall Clemons
President and Chief Executive Officer
Date: March 27, 2000
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
Signature Title Date
--------- ----- ----
/s/ J. Randall Clemons President, Chief March 27, 2000
- -------------------------------------------- Executive Officer
J. Randall Clemons and Director
/s/ Becky Taylor Principal March 27, 2000
- -------------------------------------------- Accounting Officer
Becky Taylor and Chief Financial
Officer
/s/ Elmer Richerson Executive Vice March 27, 2000
- -------------------------------------------- President &
Elmer Richerson Director
/s/ Charles Bell Director March 27, 2000
- --------------------------------------------
Charles Bell
/s/ Jack W. Bell Director March 27, 2000
- --------------------------------------------
Jack W. Bell
/s/ Mackey Bentley Director March 27, 2000
- --------------------------------------------
Mackey Bentley
/s/ James J. Comer Director March 27, 2000
- --------------------------------------------
James F. Comer
/s/ Jerry L. Franklin Director March 27, 2000
- --------------------------------------------
Jerry L. Franklin
/s/ John B. Freeman Director March 27, 2000
- --------------------------------------------
John B. Freeman
29
31
Signature Title Date
--------- ----- ----
/s/ Marshall Griffith Director March 27, 2000
- --------------------------------------------
Marshall Griffith
/s/ Harold R. Patton Director March 27, 2000
- --------------------------------------------
Harold R. Patton
/s/ James Anthony Patton Director March 27, 2000
- --------------------------------------------
James Anthony Patton
/s/ John R. Trice Director March 27, 2000
- --------------------------------------------
John R. Trice
/s/ Robert T. VanHooser, Jr. Director March 27, 2000
- --------------------------------------------
Robert T. VanHooser, Jr.
30
32
INDEX TO EXHIBITS
3.1 Charter (previously filed as Exhibit 3(a) to the Company's Registration
Statement on Form S-4 dated March 18, 1992 (Registration No. 33-46469)
and incorporated herein by reference).
3.2 Bylaws (previously filed as Exhibit 3(a) to the Company's Registration
Statement on Form S-4 dated March 18, 1992 (Registration No. 33-46469)
and incorporated herein by reference).
10.1 Wilson Bank Holding Company 1999 Stock Option Plan (incorporated herein
by reference to the Registrant's definitive Proxy Statement for the
Annual Meeting of Shareholders held April 13, 1999.
13.1 Selected Portions of the Wilson Bank Holding Company Annual
Report to Shareholders for the year ended December 31, 1999,
incorporated by reference into items 5, 6, 7 and 8.
21.1 Subsidiaries of the Company.
23 Consent of Independent Auditors
27 Financial Data Schedules (for SEC use only).
31