SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 25, 2003
Pathfinder Bancorp, Inc.
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(Exact name of registrant as specified in its charter)
Federal 000-23601 16-1540137
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(State or other jurisdiction (Commission File No.) (I.R.S. Employer
of incorporation) Identification No.)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (315) 343-0057
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NOT APPLICABLE
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(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
Item 5. Other Events
On April 25, 2003, Pathfinder Bancorp, Inc. issued the enclosed first quarter
earnings release.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
EXHIBIT 99 EARNINGS RELEASE DATED APRIL 25, 2003
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
PATHFINDER BANCORP, INC.
Date: April 25, 2003 By: /s/ Thomas W. Schneider
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Thomas W. Schneider
President and Chief Executive
Officer
EXHIBIT INDEX
The following Exhibit is filed as part of this report:
Exhibit 99 Press Release
EXHIBIT 99
CONTACT: Thomas W. Schneider - President, CEO
James A. Dowd - Vice President, CFO
Telephone: (315) 343-0057
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PATHFINDER BANCORP, INC. ANNOUNCES FIRST QUARTER EARNINGS
Oswego, New York, April 25, 2003 Pathfinder Bancorp, Inc., the mid-tier
holding company of Pathfinder Bank, (NASDAQ SmallCap Market; symbol: PBHC,
listing: PathBcp) announced reported net income of $520,000, or $0.21 per share,
for the quarter ended March 31, 2003 as compared to $551,000, or $.22 per share
for the same period in 2002.
"First quarter earnings were down 6% from the prior year as the Company
continues to absorb the costs associated with branch expansion and the operation
of a commercial bank subsidiary, without fully realizing the revenue potential
of this growth," according to Thomas W. Schneider, President and Chief Executive
Officer. "Deposit and loan growth has been strong over the last year as total
assets increased by 13% and deposit levels rose by 22%. We anticipate revenue
growth to reflect the expansion of markets and diversification of services
offered."
Net interest income for the three months ended March 31, 2003, increased 9% to
$2.4 million when compared to the same period during 2002. Interest expense
decreased $190,000 combined with a slight increase in interest income of
$12,000. Net interest rate spread was relatively consistent comparing 3.67% for
the quarter ended March 31, 2003 to 3.69% for the same period in 2002. Interest
earning assets increased 1% to $255.2 million as compared to $253.3 million at
December 31, 2002. The increase in earning assets is primarily attributable to
a $2.8 million increase in net loans receivable, partially offset by an $830,000
decrease in investment securities and a $379,000 decrease in loans held for
sale. Total deposits increased 3% to $211.4 million at March 31, 2003 compared
to $204.5 million at December 31, 2002. The increase in deposits is primarily
attributable to the increase in the money market management account.
Provision for loan losses for the quarter ended March 31, 2003 decreased 35% to
$106,000 from $162,000 for the same period in 2002. The Company had
non-performing loans of $1.8 million at March 31, 2003. The allowance for loan
losses to non-performing loans and to total loans was 82% and .83%,
respectively, at March 31, 2003.
The Company's non-interest income is principally comprised of fees on deposit
accounts and transactions, loan servicing, commissions, and net securities and
loan sale gains and losses. Non-interest income, net of gains and losses from
the sale of securities, loans and other real estate, decreased 3% to $356,000
for the quarter ended March 31, 2003 compared to $366,000 for the same period in
the prior year. The decrease in non-interest income is primarily attributable to
a $32,000 decrease in the value of bank owned life insurance, partially offset
by a $19,000 increase in service charges on deposit accounts and a $4,000
increase in loan servicing fees. Net gains and losses from the sale of
securities, loans and other real estate increased $170,000 to $208,000 for the
quarter ended March 31, 2003 compared to 38,000 for the same period in the prior
year.
Operating expenses increased 30% to $2.2 million for the quarter ended March 31,
2003, when compared to the same period in the prior year. The increase in
operating expenses was due to a $329,000 increase in salary and employee
benefits, a $77,000 increase in building occupancy expenses, a $56,000 increase
in the amortization of intangible asset and an $87,000 increase in other
expenses. These increases were partially offset by a $20,000 decrease in data
processing expenses and an $18,000 decrease in professional and other services.
The increase in salaries and employee benefits was primarily due to the salaries
and benefits associated with an additional branch location, an increase in
pension benefit costs, an increase in health insurance benefits and the hiring
of a senior commercial loan officer in the second quarter of 2002.
On March 18, 2003, the Board of Directors of Pathfinder Bancorp, Inc. declared a
$0.10 per share cash dividend to shareholders of record as of March 31, 2003,
payable on April 14, 2003.
Pathfinder Bancorp, Inc. is the mid-tier holding company of Pathfinder Bank, a
New York chartered savings bank headquartered in Oswego, New York. The Bank has
six full service offices located in its market area consisting of Oswego County.
Financial highlights for Pathfinder Bancorp, Inc. are attached. Presently, the
only business conducted by Pathfinder Bancorp, Inc. is the 100% ownership of
Pathfinder Bank and Pathfinder Statutory Trust I.
This release may contain certain forward-looking statements, which are based on
management's current expectations regarding economic, legislative, and
regulatory issues that may impact the Company's earnings in future periods.
Factors that could cause future results to vary materially from current
management expectations include, but are not limited to, general economic
conditions, changes in interest rates, deposit flows, loan demand, real estate
values, and competition; changes in accounting principles, policies, or
guidelines; changes in legislation or regulation; and economic, competitive,
governmental, regulatory, and technological factors affecting the Company's
operations, pricing, products, and services.
PATHFINDER BANCORP, INC.
FINANCIAL HIGHLIGHTS
(dollars in thousands except per share amounts)
For the three months
ended March 31,
(Unaudited)
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2003 2002
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CONDENSED INCOME STATEMENT
Interest income. . . . . . . . . . . . . . . . . . . $ 4,001 $ 3,989
Interest expense . . . . . . . . . . . . . . . . . . 1,600 1,790
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Net interest income. . . . . . . . . . . . . . . . . 2,401 2,199
Provision for loan losses. . . . . . . . . . . . . . 106 162
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Net interest income after provision for loan losses. 2,295 2,037
Other income . . . . . . . . . . . . . . . . . . . . 564 404
Other expense. . . . . . . . . . . . . . . . . . . . 2,202 1,690
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Income before taxes. . . . . . . . . . . . . . . . . 657 751
Provision for income taxes . . . . . . . . . . . . . 137 200
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Net income . . . . . . . . . . . . . . . . . . . . . $ 520 $ 551
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KEY EARNINGS RATIOS
Return on average assets . . . . . . . . . . . . . . 0.74% 0.90%
RETURN ON AVERAGE ASSETS - CASH EARNINGS*. . . . . 0.82% 0.93%
Return on average equity . . . . . . . . . . . . . . 9.93% 9.67%
RETURN ON AVERAGE EQUITY - CASH EARNINGS*. . . . . 10.94% 9.98%
Net interest margin (tax equivalent) . . . . . . . . 3.84% 3.96%
SHARE AND PER SHARE DATA
Basic weighted average shares outstanding. . . . . . 2,446,387 2,571,520
Basic earnings per share . . . . . . . . . . . . . . $ 0.21 $ 0.22
Diluted earnings per share . . . . . . . . . . . . . 0.21 0.21
CASH EARNINGS PER SHARE - BASIC. . . . . . . . . . 0.22 0.22
Cash dividends per share . . . . . . . . . . . . . . 0.10 0.07
Book value per share . . . . . . . . . . . . . . . . 8.56 8.63
(Unaudited) (Unaudited) (Unaudited)
March 31, December 31, March 31, March 31,
2003 2002 2002 2001
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SELECTED BALANCE SHEET DATA
Assets . . . . . . . . . . . . . . . . . . . . . $ 282,638 $ 279,056 $ 249,814 $ 233,081
Earning assets . . . . . . . . . . . . . . . . . 255,157 253,319 229,657 215,350
Total loans. . . . . . . . . . . . . . . . . . . 183,345 180,482 171,663 150,439
Deposits . . . . . . . . . . . . . . . . . . . . 211,446 204,522 173,784 165,060
Borrowed Funds . . . . . . . . . . . . . . . . . 41,860 42,860 50,071 44,209
Trust Preferred Debt . . . . . . . . . . . . . . 5,000 5,000 - -
Shareholders' equity . . . . . . . . . . . . . . 20,936 23,230 22,866 21,392
ASSET QUALITY RATIOS
Net loan charge-offs to average loans. . . . . . 0.15% 0.89% 0.05% 0.16%
Allowance for loan losses to period end loans. . 0.83% 0.82% 1.08% 0.89%
Allowance for loan losses to nonperforming loans 81.99% 86.57% 47.42% 66.93%
Nonperforming loans to period end loans. . . . . 1.01% 0.95% 2.20% 1.33%
Nonperforming assets to total assets . . . . . . 1.17% 1.11% 1.76% 1.28%
* Cash earnings excludes noncash charges for amortization relating to
intangibles and the allocation of ESOP stock