UNITED
STATES
|
SECURITIES
AND EXCHANGE COMMISSION
|
Washington,
D.C. 20549
|
FORM
10-K
|
x
|
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
||
For
the Fiscal Year Ended December 31, 2008
|
|||
OR
|
|||
o
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
||
For
the transition period from ___________________ to
______________________
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|||
Commission
File Number: 001- 52751
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|||
FSB
Community Bankshares, Inc.
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|||
(Exact
Name of Registrant as Specified in its
Charter)
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United
States
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74-3164710
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||||
(State
or Other Jurisdiction of Incorporation or Organization)
|
(I.R.S.
Employer Identification No.)
|
||||
45
South Main Street, Fairport, New York
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14450
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|||
(Address
of Principal Executive Offices)
|
(Zip
Code)
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(585)
223-9080
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||||||||
(Issuer’s
Telephone Number including area code)
|
||||||||
Securities
Registered Pursuant to Section 12(b) of the Act:
|
||||||||
None
|
||||||||
Name
of Each Exchange
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||||||||
Title
of Class
|
On
Which Registered
|
|||||||
Securities
Registered Pursuant to Section 12(g) of the Act:
|
||||||||
Common
Stock, par value $0.10 per
share
|
Large
accelerated filer
|
o
|
Accelerated
filer
|
o
|
|
Non-accelerated
filer
|
o
|
Smaller
reporting company
|
x
|
|
(Do
not check if smaller reporting company)
|
1.
|
Proxy
Statement for the 2009 Annual Meeting of Stockholders (Parts II and
III).
|
2.
|
Annual
Report to Shareholders for the year ended December 31, 2008 (Part
II).
|
ITEM 1. BUSINESS |
At
December 31,
|
||||||||||||||||
2008
|
2007
|
|||||||||||||||
Amount
|
Percent
|
Amount
|
Percent
|
|||||||||||||
(Dollars
in thousands)
|
||||||||||||||||
Real
estate loans:
|
||||||||||||||||
One-to-four-family
residential(1)
|
$ | 123,880 | 91.4 | % | $ | 113,267 | 91.2 | % | ||||||||
Home
equity lines of credit
|
8,214 | 6.1 | 6,622 | 5.3 | ||||||||||||
Multi-family
residential
|
846 | 0.6 | 918 | 0.7 | ||||||||||||
Construction(2)
|
316 | 0.2 | 1,114 | 0.9 | ||||||||||||
Commercial
|
2,119 | 1.6 | 2,123 | 1.7 | ||||||||||||
Other
loans
|
148 | 0.1 | 200 | 0.2 | ||||||||||||
Total
loans receivable
|
135,523 | 100.0 | % | 124,244 | 100.0 | % | ||||||||||
Deferred
loan origination costs
|
535 | 401 | ||||||||||||||
Allowance
for loan losses
|
(345 | ) | (319 | ) | ||||||||||||
Total
loans receivable, net
|
$ | 135,713 | $ | 124,326 |
(1)
|
Includes
$4.7 million and $4.7 million of closed-end home equity loans at December
31, 2008 and 2007, respectively.
|
|
(2)
|
Represents
amounts disbursed at December 31, 2008 and
2007.
|
One-to-
Four
Family
Residential
Real
Estate
Loans
|
Home
Equity
Lines
of
Credit
|
Multi-
Family
Residential
Real
Estate
Loans
|
Construction
Loans
|
Commercial
Real
Estate
Loans
|
Other
Loans
|
Total
|
||||||||||||||||||||||
(In
thousands)
|
||||||||||||||||||||||||||||
Due
During the Years
Ending December 31, |
||||||||||||||||||||||||||||
2009
|
$ | 25 | $ | — | $ | — | $ | — | $ | 150 | $ | 54 | $ | 229 | ||||||||||||||
2010
|
110 | — | — | — | 97 | 23 | 230 | |||||||||||||||||||||
2011
|
892 | — | 49 | — | 58 | 30 | 1,029 | |||||||||||||||||||||
2012
to 2013
|
6,908 | — | 62 | — | 53 | 41 | 7,064 | |||||||||||||||||||||
2014
to 2018
|
20,651 | — | 218 | — | 243 | — | 21,112 | |||||||||||||||||||||
2019
to 2023
|
28,736 | 2 | 117 | — | 997 | — | 29,852 | |||||||||||||||||||||
2024
and beyond
|
66,558 | 8,212 | 400 | 316 | 521 | — | 76,007 | |||||||||||||||||||||
Total
|
$ | 123,880 | $ | 8,214 | $ | 846 | $ | 316 | $ | 2,119 | $ | 148 | $ | 135,523 |
Due
After December 31, 2009
|
||||||||||||
Fixed
|
Adjustable
|
Total
|
||||||||||
(In
thousands)
|
||||||||||||
Real
estate loans:
|
||||||||||||
One-to-four-family
residential
|
$ | 116,396 | $ | 7,459 | $ | 123,855 | ||||||
Home
equity lines of credit
|
— | 8,214 | 8,214 | |||||||||
Multi-family
residential
|
384 | 462 | 846 | |||||||||
Construction
|
316 | — | 316 | |||||||||
Commercial
|
878 | 1,091 | 1,969 | |||||||||
Other
loans
|
94 | — | 94 | |||||||||
Total
|
$ | 118,068 | $ | 17,226 | $ | 135,294 |
For
the year ended December 31,
|
||||||||
2008
|
2007
|
|||||||
(In
thousands)
|
||||||||
Total
loans at beginning of period
|
$ | 124,244 | $ | 121,121 | ||||
Loan
originations:
|
||||||||
Real
estate loans:
|
||||||||
One-to
four-family residential
|
25,479 | 19,198 | ||||||
Home
equity lines of credit
|
2,184 | 1,431 | ||||||
Multi-family
residential
|
— | — | ||||||
Construction
|
2,818 | — | ||||||
Commercial
|
— | — | ||||||
Other
loans
|
129 | 113 | ||||||
Total
loans originated
|
30,610 | 20,742 | ||||||
Sales
and loan principal repayments:
|
||||||||
Deduct:
|
||||||||
Principal
repayments
|
16,454 | 16,605 | ||||||
Loan
sales
|
2,877 | 1,014 | ||||||
Net
loan activity
|
11,279 | 3,123 | ||||||
Total
loans at end of period
|
$ | 135,523 | $ | 124,244 |
At
December 31,
|
||||||||
2008
|
2007
|
|||||||
(Dollars
in thousands)
|
||||||||
Non-accrual
loans:
|
||||||||
Real
estate loans:
|
||||||||
One-to-four-family
residential
|
$ | 121 | $ | 63 | ||||
Home
equity lines of credit
|
25 | — | ||||||
Multi-family
residential
|
— | — | ||||||
Construction
|
— | — | ||||||
Commercial
|
— | — | ||||||
Other
loans
|
— | — | ||||||
Total
|
146 | 63 | ||||||
Accruing
loans 90 days or more past due:
|
— | — | ||||||
Total
non-performing loans
|
146 | 63 | ||||||
Foreclosed
real estate
|
— | — | ||||||
Other
non-performing assets
|
— | — | ||||||
Total
non-performing assets
|
$ | 146 | $ | 63 | ||||
Ratios:
|
||||||||
Total
non-performing loans to total loans
|
0.11 | % | 0.05 | % | ||||
Total
non-performing loans to total assets
|
0.07 | % | 0.04 | % | ||||
Total
non-performing assets to total assets
|
0.07 | % | 0.04 | % |
Loans
Delinquent For
|
||||||||||||||||||||||||
30-89
Days
|
90
Days and Over
|
Total
|
||||||||||||||||||||||
Number
|
Amount
|
Number
|
Amount
|
Number
|
Amount
|
|||||||||||||||||||
(Dollars
in thousands)
|
||||||||||||||||||||||||
At December 31,
2008
|
||||||||||||||||||||||||
Real
estate loans:
|
||||||||||||||||||||||||
One-to-four-family
residential
|
4 | $ | 59 | — | $ | — | 4 | $ | 59 | |||||||||||||||
Home
equity lines of credit
|
1 | 17 | — | — | 1 | 17 | ||||||||||||||||||
Multi-family
residential
|
— | — | — | — | — | — | ||||||||||||||||||
Construction
|
— | — | — | — | — | — | ||||||||||||||||||
Commercial
|
— | — | — | — | — | — | ||||||||||||||||||
Other
loans
|
1 | 1 | — | — | 1 | 1 | ||||||||||||||||||
Total
|
6 | $ | 77 | — | $ | — | 6 | $ | 77 | |||||||||||||||
At
December 31, 2007
|
||||||||||||||||||||||||
Real
estate loans:
|
||||||||||||||||||||||||
One-to-four-family
residential
|
8 | $ | 358 | — | $ | — | 8 | $ | 358 | |||||||||||||||
Home
equity lines of credit
|
4 | 64 | — | — | 4 | 64 | ||||||||||||||||||
Multi-family
residential
|
— | — | — | — | — | — | ||||||||||||||||||
Construction
|
— | — | — | — | — | — | ||||||||||||||||||
Commercial
|
— | — | — | — | — | — | ||||||||||||||||||
Other
loans
|
— | — | — | — | — | — | ||||||||||||||||||
Total
|
12 | $ | 422 | — | $ | — | 12 | $ | 422 |
At
or For the Years
|
||||||||
Ended
December 31,
|
||||||||
2008
|
2007
|
|||||||
(Dollars
in thousands)
|
||||||||
Balance
at beginning of year
|
$ | 319 | $ | 322 | ||||
Charge-offs:
|
||||||||
Real
estate loans:
|
||||||||
One-to-four-family
residential
|
— | — | ||||||
Home
equity lines of credit
|
— | — | ||||||
Multi-family
residential
|
— | — | ||||||
Construction
|
— | — | ||||||
Commercial
|
— | — | ||||||
Other
loans
|
— | 3 | ||||||
Total
charge-offs
|
— | 3 | ||||||
Net
charge-offs
|
— | 3 | ||||||
Recoveries
|
2 | — | ||||||
Provision
for loan losses
|
24 | — | ||||||
Balance
at end of year
|
$ | 345 | $ | 319 | ||||
Ratios:
|
||||||||
Net
charge-offs to average loans outstanding
|
0.00 | % | 0.00 | % | ||||
Allowance
for loan losses to non-performing loans at end of year
|
236.30 | % | 506.35 | % | ||||
Allowance
for loan losses to total loans at end of year
|
0.25 | % | 0.26 | % |
At
December 31,
|
||||||||||||||||||||||||
2008
|
2007
|
|||||||||||||||||||||||
Percent
of
|
Percent
of
|
Percent
of
|
Percent
of
|
|||||||||||||||||||||
Allowance
to
|
Loans
in
|
Allowance
to
|
Loans
in
|
|||||||||||||||||||||
Total
|
Category
to
|
Total
|
Category
to
|
|||||||||||||||||||||
Amount
|
Allowance
|
Total
Loans
|
Amount
|
Allowance
|
Total
Loans
|
|||||||||||||||||||
(Dollars
in thousands)
|
||||||||||||||||||||||||
Real
estate loans:
|
||||||||||||||||||||||||
One-to-four-family
residential
|
$ | 247 | 71.6 | % | 91.4 | % | $ | 218 | 68.3 | % | 91.2 | % | ||||||||||||
Home
equity lines of credit
|
67 | 19.4 | 6.1 | 67 | 21.0 | 5.3 | ||||||||||||||||||
Multi-family
residential
|
6 | 1.7 | 0.6 | 7 | 2.2 | 0.7 | ||||||||||||||||||
Construction
|
2 | 0.6 | 0.2 | 5 | 1.6 | 0.9 | ||||||||||||||||||
Commercial
|
20 | 5.8 | 1.6 | 21 | 6.6 | 1.7 | ||||||||||||||||||
Other
loans
|
1 | 0.3 | 0.1 | 1 | 0.3 | 0.2 | ||||||||||||||||||
Total
allocated allowance
|
343 | 99.4 | 100.0 | 319 | 100.0 | 100.0 | ||||||||||||||||||
Unallocated
allowance
|
2 | 0.6 | % | — | — | — | — | |||||||||||||||||
Total
allowance for loan losses
|
$ | 345 | 100.0 | % | 100.0 | % | $ | 319 | 100.0 | % | 100.0 | % |
At
December 31,
|
||||||||||||||||
2008
|
2007
|
|||||||||||||||
Amortized
|
Fair
|
Amortized
|
Fair
|
|||||||||||||
Cost
|
Value
|
Cost
|
Value
|
|||||||||||||
(In
thousands)
|
||||||||||||||||
Securities
held to maturity:
|
||||||||||||||||
U.S.
Government and agency obligations
|
$ | — | $ | — | $ | 18,997 | $ | 19,031 | ||||||||
Mortgage-backed
|
7,289 | 7,091 | 9,553 | 9,566 | ||||||||||||
Total
securities held to maturity
|
$ | 7,289 | $ | 7,091 | $ | 28,550 | $ | 28,597 | ||||||||
Securities
available for sale:
|
||||||||||||||||
U.S.
Government and agency obligations
|
$ | 22,196 | $ | 22,229 | $ | — | $ | — | ||||||||
Mortgage-backed
|
21,785 | 21,690 | — | — | ||||||||||||
Equity
Securities
|
9 | 6 | 65 | 244 | ||||||||||||
Total
securities available for sale
|
$ | 43,990 | $ | 43,925 | $ | 65 | $ | 244 |
One
Year or
Less
|
More
than One Year through
Five
Years
|
More
than Five Years
through
Ten
Years
|
More
than Ten Years
|
Total
Securities
|
||||||||||||||||||||||||||||||||||||||||
Amortized
Cost
|
Weighted
Average
Yield
|
Amortized
Cost
|
Weighted
Average
Yield
|
Amortized
Cost
|
Weighted
Average
Yield
|
Amortized
Cost
|
Weighted
Average
Yield
|
Amortized
Cost
|
Fair Value
|
Weighted
Average
Yield
|
||||||||||||||||||||||||||||||||||
(Dollars
in
thousands)
|
||||||||||||||||||||||||||||||||||||||||||||
Securities
held to maturity:
|
||||||||||||||||||||||||||||||||||||||||||||
Mortgage-backed
securities
|
$ | — | — | % | $ | — | — | % | $ | 240 | 4.41 | % | $ | 7,049 | 4.48 | % | $ | 7,289 | $ | 7,091 | 4.48 | % | ||||||||||||||||||||||
Securities
available for sale:
|
||||||||||||||||||||||||||||||||||||||||||||
U.S.
Government and agency obligations
|
$ | — | — | % | $ | 1,500 | 5.00 | % | $ | 8,360 | 5.23 | % | $ | 12,336 | 5.66 | % | $ | 22,196 | $ | 22,229 | 5.45 | % | ||||||||||||||||||||||
Mortgage-backed
securities
|
— | — | % | — | — | % | — | — | % | 21,785 | 4.71 | % | 21,785 | 21,690 | 4.71 | % | ||||||||||||||||||||||||||||
Total
securities available for sale
|
$ | — | — | % | $ | 1,500 | 5.00 | % | $ | 8,360 | 5.23 | % | $ | 34,121 | 5.05 | % | $ | 43,981 | $ | 43,919 | 5.09 | % |
For
the Years Ended December 31,
|
||||||||||||||||||||||||
2008
|
2007
|
|||||||||||||||||||||||
Weighted
|
Weighted
|
|||||||||||||||||||||||
Average
|
Average
|
Average
|
Average
|
|||||||||||||||||||||
Balance
|
Percent
|
Rate
|
Balance
|
Percent
|
Rate
|
|||||||||||||||||||
(Dollars
in thousands)
|
||||||||||||||||||||||||
Deposit
type:
|
||||||||||||||||||||||||
NOW
|
$ | 6,940 | 5.4 | % | 1.08 | % | $ | 5,721 | 4.9 | % | 0.65 | % | ||||||||||||
Savings
|
13,897 | 10.9 | 0.96 | 14,306 | 12.1 | 1.29 | ||||||||||||||||||
Money
market
|
12,429 | 9.7 | 2.12 | 10,400 | 8.8 | 2.89 | ||||||||||||||||||
Individual
retirement accounts
|
16,362 | 12.8 | 4.33 | 15,733 | 13.3 | 4.44 | ||||||||||||||||||
Certificates
of deposit
|
74,725 | 58.6 | 3.96 | 68,672 | 58.2 | 4.51 | ||||||||||||||||||
Non-interest
bearing demand deposits
|
3,256 | 2.6 | — | 3,214 | 2.7 | — | ||||||||||||||||||
Total
deposits
|
$ | 127,609 | 100.0 | % | 3.24 | % | $ | 118,046 | 100.0 | % | 3.66 | % |
At
|
|||||
December
31, 2008
|
|||||
(In
thousands)
|
|||||
Three
months or less
|
$
|
2,165
|
|||
Over
three months through six months
|
4,302
|
||||
Over
six months through one year
|
6,357
|
||||
Over
one year to three years
|
9,122
|
||||
Over
three years
|
722
|
||||
Total
|
$
|
22,668
|
At
December 31, 2008
|
||||||||||||||||||||||||
Period
to Maturity
|
||||||||||||||||||||||||
Less
Than or
|
More
Than
|
More
Than
|
||||||||||||||||||||||
Equal
to
|
One
to
|
Two
to
|
More
Than
|
Percent
of
|
||||||||||||||||||||
One
Year
|
Two
Years
|
Three
Years
|
Three
Years
|
Total
|
Total
|
|||||||||||||||||||
(Dollars
in thousands)
|
||||||||||||||||||||||||
Interest
Rate Range:
|
||||||||||||||||||||||||
2.99%
and below
|
$ | 23,063 | $ | 2,765 | $ | 350 | $ | 1,276 | $ | 27,454 | 31.4 | % | ||||||||||||
3.00%
to 3.99%
|
21,511 | 20,143 | 370 | 995 | 43,019 | 49.3 | ||||||||||||||||||
4.00%
to 4.99%
|
5,063 | 3,897 | 2,339 | 2,052 | 13,351 | 15.3 | ||||||||||||||||||
5.00%
to 5.99%
|
477 | 593 | 797 | 1,620 | 3,487 | 4.0 | ||||||||||||||||||
Total
|
$ | 50,114 | $ | 27,398 | $ | 3,856 | $ | 5,943 | $ | 87,311 | 100.00 | % |
At
December 31,
|
|||||||||
2008
|
2007
|
||||||||
(In
thousands)
|
|||||||||
Interest
Rate Range:
|
|||||||||
2.99%
and below
|
$ | 27,454 | $ | 473 | |||||
3.00%
to 3.99%
|
43,019 | 16,668 | |||||||
4.00%
to 4.99%
|
13,351 | 44,244 | |||||||
5.00%
to 5.99%
|
3,487 | 24,821 | |||||||
Total
|
$ | 87,311 | $ | 86,206 |
At
or For the Years Ended
|
|||||||||
December
31,
|
|||||||||
2008
|
2007
|
||||||||
(Dollars
in thousands)
|
|||||||||
Balance
at end of year
|
$ | 3,850 | $ | — | |||||
Average
balance during year
|
536 | 499 | |||||||
Maximum
outstanding at any month end
|
3,850 | 3,200 | |||||||
Weighted
average interest rate at end of year
|
.46 | % | n/a | ||||||
Average
interest rate during year
|
.75 | % | 6.01 | % |
As
of December 31, 2008
|
||||||||||
Required
|
||||||||||
Percent
of
|
Percent
of
|
|||||||||
Capital
|
Assets
(1)
|
Assets
(1)
|
||||||||
(Dollars
in thousands)
|
||||||||||
Tangible
capital
|
$
|
16,315
|
8.47
|
%
|
1.50
|
%
|
||||
Core
capital
|
16.315
|
8.47
|
4.00
|
|||||||
Tier 1
risk-based capital
|
16,315
|
20.09
|
4.00
|
|||||||
Total
risk-based capital
|
16,660
|
20.52
|
8.00
|
(1)
|
Tangible
capital levels are shown as a percentage of tangible assets. Core capital
levels are shown as a percentage of total adjusted assets. Total
risk-based capital levels are shown as a percentage of risk-weighted
assets.
|
●
|
the
total capital distributions for the applicable calendar year exceed the
sum of the savings association’s net income for that year to date plus the
savings association’s retained net income for the preceding two
years;
|
|
●
|
the
savings association would not be at least adequately capitalized following
the distribution;
|
|
●
|
the
distribution would violate any applicable statute, regulation, agreement
or Office of Thrift Supervision-imposed condition; or
|
|
●
|
the
savings association is not eligible for expedited treatment of its
filings.
|
The
Office of Thrift Supervision may disapprove a notice or application
if:
|
||
●
|
the
savings association would be undercapitalized following the
distribution;
|
|
●
|
the
proposed capital distribution raises safety and soundness concerns;
or
|
|
●
|
the
capital distribution would violate a prohibition contained in any statute,
regulation or
agreement.
|
(i)
|
be
made on terms that are substantially the same as, and follow credit
underwriting procedures that are not less stringent than, those prevailing
for comparable transactions with unaffiliated persons and that do not
involve more than the normal risk of repayment or present other
unfavorable features, and
|
|
(ii)
|
not
exceed certain limitations on the amount of credit extended to such
persons, individually and in the aggregate, which limits are based, in
part, on the amount of Fairport Savings Bank’s
capital.
|
●
|
well-capitalized
(at least 5% leverage capital, 6% Tier 1 risk-based capital and 10%
total risk-based capital);
|
|
●
|
adequately
capitalized (at least 4% leverage capital, 4% Tier 1 risk-based
capital and 8% total risk-based
capital);
|
●
|
undercapitalized
(less than 8% total risk-based capital, 4% Tier 1 risk-based capital
or 3% leverage capital);
|
|
●
|
significantly
undercapitalized (less than 6% total risk-based capital, 3% Tier 1
risk-based capital or 3% leverage capital); and
|
|
●
|
critically
undercapitalized (less than 2% tangible
capital).
|