Delaware
|
36-4145294
|
|
(State
or other Jurisdiction of
Incorporation
or Organization)
|
(I.R.S.
Employer Identification Nos.)
|
501
East Main Street,
Robinson,
Illinois
|
62454
|
|
(Address
of Principal Executive Offices)
|
(Zip
code)
|
Large Accelerated Filer
o
|
Accelerated Filer ¨
|
Non-
Accelerated Filer ¨
|
Smaller Reporting Company þ
|
|
•
|
projections
of revenues, income, earnings per share, capital expenditures, assets,
liabilities, dividends, capital structure, or other financial
items;
|
|
•
|
descriptions
of plans or objectives of management for future operations, products, or
services, including pending acquisition
transactions;
|
|
•
|
forecasts
of future economic performance; and
|
|
•
|
descriptions
of assumptions underlying or relating to any of the
foregoing.
|
|
•
|
general
business and economic conditions on both a regional and national
level;
|
|
•
|
worldwide
political and social unrest, including acts of war and
terrorism;
|
|
•
|
increased
competition in the products and services we offer and the markets in which
we conduct our business;
|
|
•
|
the
interest rate environment;
|
|
•
|
fluctuations
in the capital markets, which may directly or indirectly affect our asset
portfolio;
|
|
•
|
legislative
or regulatory developments, including changes in laws concerning taxes,
banking, securities, insurance and other aspects of the financial services
industry;
|
|
•
|
technological
changes, including the impact of the
Internet;
|
|
•
|
monetary
and fiscal policies of the U.S. Government, including policies of the U.S.
Treasury and the Federal Reserve
Board;
|
|
•
|
accounting
principles, policies, practices or
guidelines.
|
|
•
|
deposit
attrition, operating costs, customer loss and business disruption greater
than the Company expects;
|
|
•
|
the
occurrence of any event, change or other circumstance that could result in
the Company’s failure to develop and implement successful capital raising
and debt restructuring plans.
|
Page
|
||
PART
I
|
1
|
|
ITEM
1.
|
DESCRIPTION
OF BUSINESS
|
1
|
General
|
1
|
|
Market
Area
|
1
|
|
Lending
Activities
|
2
|
|
Asset
Quality
|
11
|
|
Investment
Activities
|
16
|
|
Trust
Services
|
18
|
|
Sources
of Funds
|
19
|
|
Subsidiary
Activities
|
21
|
|
Code
of Ethics
|
22
|
|
Competition
|
22
|
|
Regulation
|
23
|
|
Federal
and State Taxation
|
34
|
|
Employees
|
35
|
|
Recent
Accounting Pronouncements
|
35
|
|
ITEM
1A.
|
RISK
FACTORS
|
36
|
Risks
Related to Recent Developments and the Banking Industry
Generally
|
36
|
|
Risks
Related to the Company’s Business
|
38
|
|
Risks
Related to the Company’s Stock
|
42
|
|
ITEM
1.B
|
UNRESOLVED
STAFF COMMENTS
|
43
|
ITEM
2.
|
DESCRIPTION
OF PROPERTY
|
43
|
ITEM
3.
|
LEGAL
PROCEEDINGS
|
44
|
ITEM
4.
|
SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS
|
44
|
PART
II
|
45
|
|
ITEM
5.
|
MARKET
FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS ISSUER
PURCHASES OF EQUITY SECURITIES
|
45
|
ITEM
6.
|
SELECTED
FINANCIAL DATA
|
45
|
ITEM
7.
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
|
45
|
ITEM
7A.
|
QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
46
|
ITEM
8.
|
FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA
|
46
|
ITEM
9.
|
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
|
46
|
ITEM
9A(T).
|
CONTROLS
AND PROCEDURES
|
46
|
Evaluation
of Disclosure Controls and Procedures
|
46
|
|
Management’s
Annual Report On Internal Control Over Financial Reporting
|
47
|
|
ITEM
9B.
|
OTHER
INFORMATION
|
47
|
PART
III
|
48
|
|
ITEM
10.
|
DIRECTORS,
EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
48
|
Directors
|
48
|
|
Executive
Officers
|
48
|
|
Compliance
with Section 16(A)
|
48
|
|
ITEM
11.
|
EXECUTIVE
COMPENSATION
|
48
|
ITEM
12.
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
|
48
|
Equity
Compensation Plan Information
|
48
|
|
ITEM
13.
|
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
|
49
|
ITEM
14.
|
PRINCIPAL
ACCOUNTING FEES AND SERVICES
|
49
|
ITEM
15.
|
EXHIBITS
|
50
|
ITEM
1.
|
DESCRIPTION
OF BUSINESS
|
March 31,
|
||||||||||||||||
2010
|
2009
|
|||||||||||||||
Amount
|
Percent
|
Amount
|
Percent
|
|||||||||||||
(Dollars in Thousands)
|
||||||||||||||||
Real Estate Loans:
|
||||||||||||||||
One-
to four-family, held for sale.
|
$ | 88 | 0.08 | % | $ | 392 | 0.43 | % | ||||||||
One-
to four-family.
|
46,466 | 45.02 | 43,511 | 48.16 | ||||||||||||
Multi-family
|
2,780 | 2.69 | 1,242 | 1.38 | ||||||||||||
Commercial
and agricultural
|
18,155 | 17.59 | 14,793 | 16.37 | ||||||||||||
Construction
or development
|
5,130 | 4.97 | 2,624 | 2.90 | ||||||||||||
Total
real estate loans
|
72,619 | 70.35 | 62,562 | 69.24 | ||||||||||||
Other Loans:
|
||||||||||||||||
Government
Loans:
|
||||||||||||||||
State
& Municipal
|
1,885 | 1.83 | 2,172 | 2.40 | ||||||||||||
Consumer
and other loans
|
9,834 | 9.53 | 7,783 | 8.62 | ||||||||||||
Commercial
business and agricultural finance loans
|
18,883 | 18.29 | 17,835 | 19.74 | ||||||||||||
Total
other
|
30,602 | 29.65 | 27,790 | 30.76 | ||||||||||||
Total
loans
|
103,221 | 100.00 | % | 90,352 | 100.00 | % | ||||||||||
Less:
|
||||||||||||||||
Loans
in process
|
2,093 | 2,811 | ||||||||||||||
Deferred
loan fees
|
4 | 4 | ||||||||||||||
Allowance
for losses
|
973 | 780 | ||||||||||||||
Total
loans receivable, net
|
$ | 100,151 | $ | 86,757 |
Real Estate
|
||||||||||||||||||||||||||||||||||||||||||||||||
One- to Four-Family and
Construction/Development
|
Multi-family and
Commercial and
Agriculture
|
Obligations of State &
Municipal Governments
|
Consumer and Other
|
Commercial Business
and
Agricultural Finance
|
Total
|
|||||||||||||||||||||||||||||||||||||||||||
Amount
|
Weighted
Average
Rate
|
Amount
|
Weighted
Average
Rate
|
Amount
|
Weighted
Average
Rate
|
Amount
|
Weighted
Average
Rate
|
Amount
|
Weighted
Average
Rate
|
Amount
|
Weighted
Average
Rate
|
|||||||||||||||||||||||||||||||||||||
(Dollars
in Thousands)
|
||||||||||||||||||||||||||||||||||||||||||||||||
Due
During
Years
Ending
March
31,
|
||||||||||||||||||||||||||||||||||||||||||||||||
2011(1)
|
$ | 7,121 | 6.21 | % | $ | 4,280 | 4.32 | % | $ | 190 | 1.31 | % | $ | 670 | 6.98 | % | $ | 9,885 | 4.16 | % | $ | 22,146 | 4.91 | % | ||||||||||||||||||||||||
2012
and 2013
|
3,782 | 6.42 | 3,880 | 5.51 | 1,025 | 5.08 | 2,572 | 7.83 | 2,581 | 5.92 | 13,840 | 6.24 | ||||||||||||||||||||||||||||||||||||
2014
and 2015
|
4,786 | 6.55 | 3,114 | 5.52 | 402 | 4.32 | 4,786 | 6.52 | 5,207 | 4.71 | 18,295 | 5.80 | ||||||||||||||||||||||||||||||||||||
After
2015
|
35,995 | 5.92 | 9,661 | 5.84 | 268 | 3.76 | 1,806 | 6.29 | 1,210 | 6.29 | 48,940 | 5.92 | ||||||||||||||||||||||||||||||||||||
Total
|
$ | 51,684 | 6.06 | % | $ | 20,935 | 5.42 | % | $ | 1,885 | 4.35 | % | $ | 9,834 | 6.85 | % | $ | 18,883 | 4.69 | % | $ | 103,221 | 5.62 | % |
(1)
|
Includes
demand loans, loans having no stated maturity and overdraft
loans.
|
Year Ended March 31,
|
||||||||
2010
|
2009
|
|||||||
(Dollars in Thousands)
|
||||||||
Originations By
Type:
|
||||||||
Real
estate:
|
||||||||
One
to four-family
|
$ | 42,231 | $ | 34,768 | ||||
Multi-family
|
2,522 | 1,416 | ||||||
Commercial
and agricultural
|
7,769 | 5,437 | ||||||
Construction
and land development
|
5,757 | 2,857 | ||||||
Other:
|
||||||||
Consumer
and other loans
|
9,035 | 5,092 | ||||||
State
& Municipal Government
|
2,839 | 853 | ||||||
Commercial
business and agricultural finance
|
11,304 | 14,717 | ||||||
Total
loans originated
|
81,457 | 65,140 | ||||||
Purchases:
|
||||||||
Real
estate:
|
||||||||
Commercial
and agricultural
|
— | 500 | ||||||
Other:
|
||||||||
Commercial
business and agricultural finance
|
4,000 | — | ||||||
Other
loan
|
500 | 1,000 | ||||||
Total
loan purchases
|
4,500 | 1,500 | ||||||
Sales And
Repayments:
|
||||||||
Real
estate:
|
||||||||
One-
to four-family
|
27,856 | 19,614 | ||||||
Commercial
and agricultural
|
908 | — | ||||||
Other:
|
||||||||
Commercial
business and agricultural finance and other loans
|
633 | |||||||
Total
sales
|
28,764 | 20,247 | ||||||
Principal
reductions
|
44,136 | 33,455 | ||||||
Decreases
in other items, net
|
188 | 315 | ||||||
Net
increase in gross loans
|
$ | 12,869 | $ | 12,623 |
Loans Delinquent For:
|
||||||||||||||||||||||||||||||||||||||||||||||||
30-89 Days(1)
|
90 Days and Over(1)
|
Nonaccrual
|
Total Delinquent Loans
|
|||||||||||||||||||||||||||||||||||||||||||||
Number
|
Amount
|
Percent
of Loan
Category
|
Number
|
Amount
|
Percent
of Loan
Category
|
Number
|
Amount
|
Percent
of Loan
Category
|
Number
|
Amount
|
Percent
of Loan
Category
|
|||||||||||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||||||||||||||
Real
Estate:
|
||||||||||||||||||||||||||||||||||||||||||||||||
One-
to four-family
|
2 | $ | 77 | 0.17 | % | — | $ | — | — | % | 4 | $ | 85 | 0.18 | % | 6 | $ | 162 | 0.35 | % | ||||||||||||||||||||||||||||
Commercial
business and agricultural finance
|
— | — | — | — | — | — | 1 | 32 | 0.18 | 1 | 32 | 0.18 | ||||||||||||||||||||||||||||||||||||
OtherLoans:
State & Municipal Gov’t
|
1 | 85 | 4.51 | — | — | — | — | — | — | 1 | 85 | 4.51 | ||||||||||||||||||||||||||||||||||||
Consumer
and others
|
3 | 21 | 0.21 | — | — | — | 1 | 5 | 0.05 | 4 | 26 | 0.26 | ||||||||||||||||||||||||||||||||||||
Commercial
business and agricultural finance
|
— | — | — | — | — | — | 1 | 13 | 0.07 | 1 | 13 | 0.07 | ||||||||||||||||||||||||||||||||||||
Total
|
6 | $ | 183 | 0.18 | % | — | $ | — | — | % | 7 | $ | 135 | 0.13 | % | 13 | $ | 318 | 0.31 | % |
Year Ended
March 31,
|
||||||||
2010
|
2009
|
|||||||
(Dollars in thousands)
|
||||||||
Non-accruing
loans:
|
||||||||
One-
to four-family
|
$ | 85 | $ | 192 | ||||
Commercial
and agricultural real estate
|
32 | — | ||||||
Consumer
and other
|
5 | 14 | ||||||
Commercial
business and agricultural finance
|
13 | 29 | ||||||
Total
|
135 | 235 | ||||||
Foreclosed
assets:
|
||||||||
One-
to four-family
|
52 | 46 | ||||||
Total
|
52 | 46 | ||||||
Total
non-performing assets
|
$ | 187 | $ | 281 | ||||
Total
as a percentage of total assets
|
0.10 | % | 0.17 | % |
March 31,
|
||||||||||||||||||||||||
2010
|
2009
|
|||||||||||||||||||||||
Amount of
Loan Loss
Allowance
|
Loan
Amounts by
Category
|
Percent
of Loans
in Each
Category to
Total Loans
|
Amount of
Loan Loss
Allowance
|
Loan
Amounts by
Category
|
Percent
of Loans
in Each
Category
to Total
Loans
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
One-
to four-family including loans held for sale
|
$ | 72 | $ | 46,554 | 45.10 | % | $ | 66 | $ | 43,903 | 48.59 | % | ||||||||||||
Multi-family
|
— | 2,780 | 2.69 | — | 1,242 | 1.38 | ||||||||||||||||||
Commercial
and agricultural real estate
|
593 | 18,155 | 17.59 | 458 | 14,793 | 16.37 | ||||||||||||||||||
Construction
or Development
|
— | 5,130 | 4.97 | — | 2,624 | 2.90 | ||||||||||||||||||
State
& Municipal Government Loans
|
— | 1,885 | 1.83 | — | 2,172 | 2.40 | ||||||||||||||||||
Consumer
and other loans
|
29 | 9,834 | 9.53 | 34 | 7,783 | 8.62 | ||||||||||||||||||
Commercial
business and agricultural finance
|
279 | 18,883 | 18.29 | 222 | 17,835 | 19.74 | ||||||||||||||||||
Unallocated
|
— | — | — | — | — | — | ||||||||||||||||||
Total
|
$ | 973 | $ | 103,221 | 100.00 | % | $ | 780 | $ | 90,352 | 100.00 | % |
Year Ended
March 31,
|
||||||||
2010
|
2009
|
|||||||
(Dollars in thousands)
|
||||||||
Balance
at beginning of year
|
$ | 780 | $ | 727 | ||||
Charge-offs:
|
||||||||
One-
to four-family
|
136 | 28 | ||||||
Commercial
and agricultural real estate
|
— | 123 | ||||||
Consumer
and other loans
|
1,023 | 44 | ||||||
Commercial
business and agricultural finance
|
— | — | ||||||
Total:
|
1,159 | 195 | ||||||
Recoveries:
|
||||||||
One-
to four-family
|
4 | 1 | ||||||
Consumer
and other loans
|
51 | 27 | ||||||
Total:
|
55 | 28 | ||||||
Net
charge-offs
|
1,104 | 167 | ||||||
Additions
charged to operations
|
1,297 | 220 | ||||||
Balance
at end of year
|
$ | 973 | $ | 780 | ||||
Ratio
of net charge-offs during the year to average loans outstanding during the
year
|
1.18 | % | 0.21 | % | ||||
Ratio
of net charge-offs during the year to average non-performing
assets
|
487.03 | % | 58.22 | % |
March
31,
|
||||||||||||||||
2010
|
2009
|
|||||||||||||||
Market
Value
|
%
of
Total
|
Market
Value
|
%
of
Total
|
|||||||||||||
(Dollars
in thousands)
|
||||||||||||||||
U.S.
Government sponsored enterprises (“GSE”)
|
$ | 15,191 | 27.42 | % | $ | 9,992 | 17.87 | % | ||||||||
Mortgage-backed
securities, GSE, residential
|
36,472 | 65.84 | 40,901 | 73.13 | ||||||||||||
State
and political subdivisions
|
3,736 | 6.74 | 5,032 | 9.00 | ||||||||||||
Total
available for sale
|
$ | 55,399 | 100.00 | % | $ | 55,925 | 100.00 | % | ||||||||
Average
remaining life of investment and mortgage-backed
securities
|
15.48
Years
|
15.96
Years
|
||||||||||||||
Other
interest-earning assets:
|
||||||||||||||||
Federal
funds sold
|
7,852 | 69.32 | 7,572 | 91.39 | ||||||||||||
Interest-bearing
deposits with banks
|
3,475 | 30.68 | 713 | 8.61 | ||||||||||||
Total
other interest earnings investments
|
$ | 11,327 | 100.00 | % | $ | 8,285 | 100.00 | % |
Due
in
|
||||||||||||||||||||
1
Year
or
Less
|
1
to
5
Years
|
5
to 10
Years
|
10
Years
or
More
|
Total
|
||||||||||||||||
Federal
Home Loan Mortgage Corporation
|
$ | 595 | $ | 244 | $ | 3,806 | $ | 5,727 | $ | 10,372 | ||||||||||
Weighted
Average Rate
|
3.28 | 4.29 | % | 4.97 | % | 4.51 | % | 4.60 | % | |||||||||||
Federal
National Mortgage Company
|
— | 1,394 | 1,650 | 17,901 | 20,945 | |||||||||||||||
Weighted
Average Rate
|
— | 4.07 | 4.49 | 4.82 | 4.74 | |||||||||||||||
Government
National Mortgage Company
|
— | — | 268 | 4,887 | 5,155 | |||||||||||||||
Weighted
Average Rate
|
— | — | 3.63 | 4.15 | 4.13 | |||||||||||||||
Total
|
$ | 595 | $ | 1,638 | $ | 5,724 | $ | 28,515 | $ | 36,472 | ||||||||||
Weighted
Average Rate
|
3.28 | 4.10 | % | 4.77 | % | 4.64 | % | 4.54 | % |
Year
Ended
March
31,
|
||||||||
2010
|
2009
|
|||||||
(Dollars
in thousands)
|
||||||||
Opening
balance
|
$ | 140,088 | $ | 103,898 | ||||
Deposits
|
1,005,121 | 1,027,901 | ||||||
Withdrawals
|
(998,515 | ) | (994,033 | ) | ||||
Interest
credited
|
2,618 | 2,322 | ||||||
Ending
balance
|
149,312 | 140,088 | ||||||
Net
increase
|
$ | 9,224 | $ | 36,190 | ||||
Percent
increase
|
6.58 | % | 34.83 | % |
March
31,
|
||||||||||||||||
2010
|
2009
|
|||||||||||||||
Amount
|
Percent
of
Total
|
Amount
|
Percent
of
Total
|
|||||||||||||
(Dollars
in thousands)
|
||||||||||||||||
Transactions and Savings
Deposits:
|
||||||||||||||||
Non-interest
bearing demand (0.00%)
|
$ | 15,248 | 10.21 | % | $ | 12,828 | 9.16 | % | ||||||||
Statement
Savings and Money Market Accounts (0.50%)
|
22,863 | 15.31 | 22,443 | 16.02 | ||||||||||||
NOW
Accounts (2.06%)
|
53,512 | 35.84 | 43,752 | 31.23 | ||||||||||||
Total
non-certificates
|
91,623 | 61.36 | 79,023 | 56.41 | ||||||||||||
Certificates:
|
||||||||||||||||
0.40 –
1.99%
|
16,101 | 10.78 | % | 4,590 | 3.28 | % | ||||||||||
2.00 –
3.99%
|
30,405 | 20.36 | 33,733 | 24.08 | ||||||||||||
4.00 –
5.99%
|
11,183 | 7.48 | 22,742 | 16.23 | ||||||||||||
Total
certificates
|
57,689 | 38.64 | 61,065 | 43.59 | ||||||||||||
Total
deposits
|
$ | 149,312 | 100.00 | % | $ | 140,088 | 100.00 | % |
0.40
-
1.99%
|
2.00-
3.99%
|
4.00-
5.99%
|
Total
|
Percent
of
Total
|
Weighted
Average
Rate
|
|||||||||||||||||||
|
(Dollars
in thousands)
|
|||||||||||||||||||||||
Certificate
accounts maturing
In
quarter ending:
|
||||||||||||||||||||||||
June
30, 2010
|
$ | 8,106 | $ | 4,142 | $ | 2,348 | $ | 14,596 | 25.30 | % | 2.50 | % | ||||||||||||
September
30, 2010
|
2,652 | 3,602 | 238 | 6,492 | 11.25 | 2.22 | ||||||||||||||||||
December
31, 2010
|
1,636 | 145 | 1,858 | 3,639 | 6.31 | 2.69 | ||||||||||||||||||
March
31, 2011
|
2,201 | 973 | 2,112 | 5,286 | 9.16 | 2.72 | ||||||||||||||||||
June
30, 2011
|
268 | 5,082 | 323 | 5,673 | 9.83 | 3.59 | ||||||||||||||||||
September
30, 2011
|
716 | 3,003 | 580 | 4,299 | 7.45 | 2.88 | ||||||||||||||||||
December
31, 2011
|
83 | 5,044 | 586 | 5,713 | 9.90 | 2.98 | ||||||||||||||||||
March
31, 2012
|
99 | 3,270 | 344 | 3,713 | 6.44 | 2.63 | ||||||||||||||||||
June
30, 2012
|
81 | 2,568 | 901 | 3,550 | 6.16 | 2.83 | ||||||||||||||||||
September
30, 2012
|
42 | 71 | 746 | 859 | 1.49 | 4.40 | ||||||||||||||||||
December
31, 2012
|
22 | 80 | 30 | 132 | 0.23 | 2.93 | ||||||||||||||||||
March
31, 2013
|
62 | 255 | 16 | 333 | 0.58 | 2.87 | ||||||||||||||||||
Thereafter
|
133 | 2,170 | 1,101 | 3,404 | 5.90 | 3.35 | ||||||||||||||||||
Total
|
$ | 16,101 | $ | 30,405 | $ | 11,183 | $ | 57,689 | 100.00 | % | 3.34 | % | ||||||||||||
Percent
of total
|
27.91 | % | 52.71 | % | 19.38 | % | 100.00 | % |
Maturity
|
||||||||||||||||||||
3
Months
or
Less
|
Over
3
to 6
Months
|
Over
6
to 12
Months
|
Over
12
months
|
Total
|
||||||||||||||||
Certificates
of deposit less than $100,000
|
$ | 5,963 | $ | 4,389 | $ | 6,556 | $ | 19,425 | $ | 36,333 | ||||||||||
Certificates
of deposit of $100,000 or more
|
1,793 | 1,078 | 2,369 | 8,251 | 13,493 | |||||||||||||||
Public
funds of $100,000 or more (1)
|
6,838 | 1,025 | — | — | 7,863 | |||||||||||||||
Total
certificates of deposit
|
$ | 14,596 | $ | 6,492 | $ | 8,925 | $ | 27,676 | $ | 57,689 |
(1)
|
Deposits
from governmental and other public
entities.
|
|
•
|
Capital
Purchase Program (“CPP”). Pursuant to this program, the US
Treasury, on behalf of the US government, will purchase up to $250 billion
of preferred stock, along with warrants to purchase common stock, from
certain financial institutions, including bank holding companies, savings
and loan holding companies and banks or savings associations not
controlled by a holding company. The investment will have a
dividend rate of 5% per year, until the fifth anniversary of the US
Treasury’s investment and a dividend of 9%
thereafter.
|
|
•
|
Temporary
Liquidity Guarantee Program (“TLGP”). That program contained
both a debt guarantee component, whereby the FDIC guaranteed until
June 30, 2012, the senior unsecured debt issued by eligible financial
institutions between October 14, 2008 and October 31, 2009 (although a
limited, six-month emergency guarantee facility was established by the
FDIC whereby certain participating entities could apply to the FDIC for
permission to issue FDIC-guaranteed debt during the period from October
31, 2009 through April 30, 2010), and a transaction account guarantee
component, whereby the FDIC will insure 100% of non-interest bearing
deposit transaction accounts held at eligible financial institutions, such
as payment processing accounts, payroll accounts and working capital
accounts through December 31, 2010 (with the possibility of an additional
extension until December 31, 2011 if the FDIC invokes its authority to so
extend the program). The Bank opted out of the debt guarantee
component of the TLGP and thus did not pay any participation fees
associated therewith. The Bank is, however, participating in the
transaction account guarantee program and related extensions and will be
required to pay to the FDIC fees in connection with such
participation.
|
|
•
|
Temporary
increase in deposit insurance coverage. Pursuant to the EESA,
the FDIC temporarily raised the basic limit on federal deposit insurance
coverage from $100,000 to $250,000 per depositor. The EESA
provides that the basic deposit insurance limit will return to $100,000
after December 31, 2013 (although the increased coverage is permanent for
certain retirement accounts, including
IRAs).
|
|
•
|
Another
recently implemented program intended to stabilize the nation’s banking
system is the Term Asset-Backed Securities Loan Facility (the “TALF”)
promulgated by the Board of Governors of the Federal Reserve
System. The program, which became operational in March 2009, is
intended to increase credit availability and support economic activity by
facilitating renewed issuance of consumer and small business asset-backed
securities (“ABS”) and commercial mortgage-backed securities
(“CMBS”). Under TALF, the Federal Reserve Bank of New York will
finance the purchase of eligible ABS and CMBS by investors that own
eligible collateral so long as such investor maintains an account
relationship with a primary dealer. Generally, eligible ABS
must be newly issued, highly rated ABS collateralized by student loans,
auto loans, credit card loans, and loans guaranteed by the Small Business
Administration. Eligible CMBS must also meet certain
requirements, including: (i) it must entitle its holders to payments
of principal and interest throughout its remaining term, (ii) it must
bear interest at a fixed pass-through rate or at a rate based on the
weighted average of the underlying fixed mortgage rates, and (iii) it not
be junior to other securities with claims on the same pool of
loans. Minimum loan sizes under the TALF will be $10 million
and TALF loans will generally have a three year
maturity. Starting in June 2009, however, TALF loans secured by
SBA Pool Certificates, SBA Development Company Participation Certificates,
or ABS secured by student loans or commercial mortgages were permitted to
have a five-year maturity if the borrower so elects. The
Federal Reserve intends to cease making new loans securitized by CMBS on
June 30, 2010. Loans secured by other collateral ceased on
March 31, 2010.
|
|
•
|
Overall
asset quality, potential need to increase reserves and write down assets,
and concentrations of credit;
|
|
•
|
Potential
for unanticipated losses and declines in asset
values;
|
|
•
|
Implicit
and explicit liquidity and credit commitments, including off-balance sheet
and contingent liabilities;
|
|
•
|
Quality
and level of current and prospective earnings, including earnings capacity
under a number of plausible economic
scenarios;
|
|
•
|
Current
and prospective cash flow and
liquidity;
|
|
•
|
Ability
to serve as an ongoing source of financial and managerial strength to
depository institution subsidiaries insured by the Federal Deposit
Insurance Corporation, including the extent of double leverage and the
condition of subsidiary depository
institutions;
|
|
•
|
Other
risks that affect the bank holding company’s financial condition and are
not fully captured in regulatory capital
calculations;
|
|
•
|
Level,
composition, and quality of capital;
and
|
|
•
|
Ability
to raise additional equity capital in prevailing market and economic
conditions.
|
ITEM
1A.
|
RISK
FACTORS
|
|
·
|
Commercial Loans.
Repayment is dependent upon the successful operation of the borrower’s
business
|
|
·
|
Consumer Loans.
Consumer loans (such as personal lines of credit) are collateralized, if
at all, with assets that may not provide an adequate source of payment of
the loan due to depreciation, damage, or
loss.
|
|
·
|
Agricultural Finance
Loans. Repayment is dependent upon the successful operation of the
business, which are greatly dependent on many things outside the control
of either the Bank or the borrowers. These factor include
weather, commodity prices, and interest rates, among
others.
|
•
|
announcements
of developments related to the Company’s
business,
|
•
|
fluctuations
in the Company’s results of
operations,
|
•
|
sales
of substantial amounts of the Company’s securities into the
marketplace,
|
•
|
general
conditions in the Company’s banking niche or the worldwide
economy,
|
•
|
a
shortfall in revenues or earnings compared to securities analysts’
expectations,
|
•
|
lack
of an active trading market for the common
stock,
|
•
|
commencement
of, or changes in analysts’ recommendations or projections,
and
|
•
|
the
Company’s announcement of new acquisitions or other
projects.
|
ITEM
1B.
|
UNRESOLVED
STAFF COMMENTS
|
ITEM
2.
|
DESCRIPTION
OF PROPERTY
|
Location
|
Date
Acquired
|
Total
Approximate
Square
Footage
|
Net Book Value of
Buildings and
Improvements at
March 31, 2010
|
|||||||
Main
Office:
|
||||||||||
501
East Main Street
|
1985
|
12,420 |
$
|
1.2
million
|
||||||
Robinson,
Illinois
|
||||||||||
Branch
Offices:
|
||||||||||
119
East Grand Prairie
|
1995
|
1,800 | 237,000 | |||||||
Palestine,
Illinois
|
||||||||||
102
West Main Street
|
1995
|
2,260 | 78,000 | |||||||
Oblong,
Illinois
|
||||||||||
Outer
East Main Street
|
1997
|
1,000 | 84,000 | |||||||
Oblong,
Illinois
|
||||||||||
615
Kimmel Road
|
2008
|
2,612 | 540,000 | |||||||
Vincennes,
Indiana
|
ITEM
3.
|
LEGAL
PROCEEDINGS
|
ITEM
4.
|
SUBMISSION
OF MATTERS TO A VOTE OF SECURITY
HOLDERS
|
ITEM
5.
|
MARKET
FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS ISSUER
PURCHASES OF EQUITY SECURITIES
|
Period
|
Total Number
of Shares
Purchased
|
Average Price
Paid per Share
|
Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs
|
Maximum Number
of Shares that May
Yet Be Purchased
Under the Plans or
Programs
|
||||||||||||
1/1/2010
– 1/31/2010
|
— | $ | — | — | 12,160 | |||||||||||
2/1/2010
– 2/28/2010
|
— | — | — | 12,160 | ||||||||||||
3/1/2010–
3/31/2010
|
335 | 35.25 | — | 12,160 | ||||||||||||
Total
|
335 | $ | 35.25 | — | 12,160 |
ITEM
6.
|
SELECTED
FINANCIAL DATA
|
ITEM
7.
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
|
ITEM
7A.
|
QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
|
ITEM
8.
|
FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA
|
Annual Report Section
|
Pages in
Annual Report
|
|
Report
of Independent Registered Public Accounting Firm
|
23
|
|
Consolidated
Balance Sheets for the Fiscal Years Ended March 31, 2010 and
2009
|
24
|
|
Consolidated
Statements of Operations for the Years Ended March 31, 2010 and
2009
|
25
|
|
Consolidated
Statements of Stockholders’ Equity for Years Ended March 31, 2010 and
2009
|
26
|
|
Consolidated
Statements of Cash Flows for the Years Ended March 31, 2010 and
2009
|
27
|
|
Notes
to Consolidated Financial Statements
|
29
|
ITEM
9.
|
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ONACCOUNTING
AND FINANCIAL DISCLOSURE
|
ITEM
9A(T).
|
CONTROLS
AND PROCEDURES
|
ITEM
9B.
|
OTHER
INFORMATION
|
ITEM
10.
|
DIRECTORS,
EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE
|
ITEM
11.
|
EXECUTIVE
COMPENSATION
|
ITEM
12.
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
|
ITEM
13.
|
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
|
ITEM
14.
|
PRINCIPAL
ACCOUNTING FEES AND SERVICES
|
ITEM
15.
|
EXHIBITS
|
(a)
|
Exhibits
|
Exhibit
Number
|
Document
|
Reference to
Prior Filing or
Exhibit Number
Attached Hereto
|
|||
3(i)
|
Certificate
of Incorporation
|
*
|
|||
3(ii)
|
By-Laws
|
**
|
|||
4
|
Instruments
defining the rights of security holders, including
debentures
|
*
|
|||
10
|
Material
Contracts
|
None
|
|||
13
|
Annual
Report to Stockholders
|
13
|
|||
21
|
Subsidiaries
of Registrant
|
21
|
|||
31.1
|
Certification
of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
|
31.1
|
|||
31.2
|
Certification
of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
|
31.2
|
|||
32.1
|
Certification
of CEO and CFO pursuant to Section 906 of the Sarbanes-Oxley Act of
2002
|
32.1
|
*
|
Incorporated
by reference to the Company’s Registration Statement on Form S-1 filed
with the SEC on March 19, 1997 (File No.
333-23625).
|
**
|
Incorporated
by reference to the Company’s Form 10-KSB for the fiscal year ended March
31, 2008 filed with the SEC on June 30, 2008 (File No. 001-12969; Film No.
08924531).
|
FIRST
ROBINSON FINANCIAL CORPORATION
|
||
Date: June
25, 2010
|
By:
|
/s/ Rick L. Catt
|
Rick
L. Catt, Director,
|
||
President
and Chief Executive
|
||
Officer
|
By:
|
/s/ Rick L. Catt
|
By:
|
/s/ Jamie E. McReynolds
|
|
Rick
L. Catt,
|
Jamie
E. McReynolds,
|
|||
Director,
President and Chief
|
Vice
President, Chief Financial Officer
|
|||
Executive
Officer (Principal
Executive
|
and
Secretary
|
|||
and Operating
Officer)
|
(Chief
Financial and Accounting Officer)
|
|||
Date:
|
June
25, 2010
|
Date:
|
June
25, 2010
|
|
By:
|
/s/ Scott F. Pulliam
|
By:
|
/s/ J. Douglas Goodwine
|
|
Scott
F. Pulliam,
|
J.
Douglas Goodwine,
|
|||
Director
|
Director
|
|||
Date:
|
June
25, 2010
|
Date:
|
June
25, 2010
|
|
By:
|
/s/ Robin E. Guyer
|
By:
|
/s/ Steven E. Neeley
|
|
Robin
E. Guyer,
|
Steven
E. Neeley,
|
|||
Director
|
Director
|
|||
Date:
|
June
25, 2010
|
Date:
|
June
25, 2010
|
|
By:
|
/s/ William K. Thomas
|
|||
William
K. Thomas,
|
||||
Director
|
||||
Date:
|
June
25, 2010
|