NORTHERN STATES FINANCIAL CORPORATION  

MANAGEMENT'S DISCUSSION AND ANALYSES OF FINANCIAL CONDITION AND RESULTS (CONTINUED)

 

activities in which the Company and the Bank may engage, the investments and loans that the Bank may fund, and the reserves against deposits with the Bank must maintain.
   The statements contained in management's discussion and analysis that are not historical fact are forward-looking statements subject to the safe harbor created by the Private Securities Reform Act of 1995. Forward-looking statements, which are based

  

 

on certain assumptions and describe future plans, strategies and expectations of the Company, are identifiable by the use of the words "believe", "expect, "intend", "estimate" or similar expressions. The Company cautions readers of this Annual Report that a number of important factors could cause the Company's actual results in 2001 and beyond to differ materially from those expressed in any such forward-looking statements.

 

  TABLE 1 ANALYSIS OF AVERAGE BALANCES, TAX EQUIVALENT YIELDS AND RATES

($ 000s)
For the Year Ended December 31,
2000
1999
1998
 
Average
 Balance
Interest
Rate
Average
 Balance
Interest
Rate
Average
 Balance
Interest
Rate
Assets                  
Loans (1) (2) (3)
$ 274,194
$ 24,963
9.10%
$ 244,039
$ 20,896
8.56%
$ 242,020
$ 21,903
9.05%
Taxable securities   (5)
171,403
10,836
6.11 
175,146
10,633
6.00 
167,117
10,263
6.16 
Securities exempt   from
  
  
  
  
  
  
  
  
  
  federal income   taxes (2)(5)
17,835
1,355
7.56 
20,754
1,568
7.68 
19,552
1,543
8.18 
Interest bearing   deposits
  
  
  
  
  
  
  
  
  
  in financial   institutions
229
14
6.11 
296
16
5.41 
428
25
5.84 
Federal funds sold
9,080
581
6.40 
6,171
298
4.83
21,157
1,135
5.36
  Interest earning   assets
472,741
37,749
7.88
446,406
33,441
7.46
450,274
34,869
7.76
Noninterest   earning assets
26,784
  
  
26,293
  
  
20,823
  
  
  Average assets   (4)
499,525
  
  
472,699
  
  
471,097
  
  
  
  
  
  
  
  
  
  
  
  
Liabilities and
  Stockholders'   Equity
  
  
  
  
  
    
  
  
  
NOW deposits
$  42,688
1,152
2.70
$  46,403
1,204
2.59
$  39,310
1,157
2.94
Money market   deposits
35,664
1,400
3.93
40,557
1,416
3.49
42,400
1,656
3.91
Savings deposits
44,283
1,211
2.73
45,553
1,275
2.80
44,067
1,311
2.98
Time deposits
183,763
10,976
5.97
169,901
8,526
5.02
188,365
10,413
5.53
Other borrowings
74,697
4,481
6.00
54,852
2,584
4.71
45,582
2,359
5.18
  Interest bearing   liabilities
381,095
19,220
5.04
357,266
15,005
4.20
359,724
16,896
4.70
Demand deposits
43,122
  
  
43,128
  
  
40,254
  
  
Other noninterest                          
  bearing liabilities
8,067
  
  
6,886
  
  
8,500
  
    
Stockholders'   equity
67,241
  
  
65,419
  
  
62,619
  
  
  Average liabilities and                                              
  stockholders'   equity
$ 499,525
      
    
$ 472,699
    
    
$ 471,097
    
    
Net interest   income
  
$ 18,529
  
  
$ 18,436
  
$   17,973
  
  
Net yield on   interest
  
  
  
  
  
  
  
  
  
  earning assets  
  
  
3.87%
  
  
4.11%
  
  
3.99%
Interest bearing   liabilities
                          
  to earning
  assets ratio		     
80.61%
      
80.03%
      
79.89%

 

(1) -

 

Interest income on loans includes loan origination and other fees of $344 for 2000, $353 for 1999, and $475 for 1998. Average loans include direct lease financing.

 

(5) -

 

Rate information was calculated based on the average amortized cost for securities. The 2000, 1999, and 1998 average balance information includes an average unrealized gain (loss) for taxable securities of $(5,957), $(2,425), and $397. The 2000, 1999, and 1998 average balance information includes an average unrealized gain (loss) of $(97), $344, and $682 for tax-exempt securities.
(2) - Tax-exempt income is reflected on a fully tax equivalent basis utilizing a 34% rate.  
(3) - Non-accrual loans are included in average loans.  
(4) - Average balances are derived from the average daily balances.


 NSFC ANNUAL REPORT 2000
19