Item 1 Business - ------ --------
Description of Business - -----------------------
BT Financial Corporation ("BT" or the "Registrant") is a multi-bank holding company located in Johnstown, Pennsylvania, which was incorporated under the laws of the Commonwealth of Pennsylvania on December 16, 1982.
The Registrant has three banking subsidiaries: Johnstown Bank and Trust Company ("Bank and Trust"), Laurel Bank ("Laurel") and Fayette Bank ("Fayette")(each referred to as a "Bank" and collectively referred to as the "Banks"). The Banks' principal places of business are in Johnstown, Ebensburg and Uniontown, Pennsylvania, respectively. At December 31, 1996 the Registrant had total assets of $1.5 billion. The Registrant also has three nonbank subsidiaries, Bedford Associates, Inc., which holds and leases property used by the Banks in their banking operations, BT Management Trust Company, a trust company which provides trust and investment services, and Moxham Community Development Corporation, a corporation which conducts community development activities.
On June 25, 1996, BT completed a merger with Moxham Bank Corporation ("Moxham") whereby Moxham was merged directly into BT. In connection with the merger, each share of Moxham common stock (other than shares held by the Registrant) was converted into 1.15 shares of BT Common Stock, resulting in the issuance of 1,038,519 shares of BT Common Stock. In addition, 88,550 shares of BT Common Stock were exchanged for all 14,000 outstanding shares of Moxham Series A $8.00 cumulative convertible non-voting preferred stock. The merger has been accounted for as a pooling-of-interests and accordingly BT's consolidated financial statements have been restated retroactively to include the accounts and operations of Moxham for all periods prior to the merger. Moxham's banking subsidiaries included the Moxham National Bank and The First National Bank of Garrett, and Moxham also held the Moxham Community Development Corporation. Upon consummation of the merger, Moxham's banking subsidiaries were merged into Bank and Trust on June 25, 1996. At the time of the merger, Moxham had assets of approximately $235 million and operated 12 branches in Cambria, Somerset, and Westmoreland counties.
The Banks conduct business through a network of 69 full-service offices located throughout southwestern Pennsylvania. Each Bank operates under the management of its own officers and directors, although certain financial and administrative functions, including auditing, marketing, human resources, investment, accounting, data processing and credit review, are coordinated through the Registrant. In addition, the Banks operate 54 automated teller machines ("ATM's") at 53 locations which are part of the "Cirrus " and "MAC " systems. "Cirrus " and "MAC " provide links to national and regional ATM networks.
The Banks provide a full range of financial services to individuals, businesses and governmental bodies, including accepting demand, savings and time deposits, making secured and unsecured loans, and electronic data processing of payrolls. The Banks also offer lending services, including consumer, credit cards, real estate, commercial and industrial loans. BT Management Trust Company offers a wide range of corporate pension and personal trust and trust related services. The Banks' deposits are insured by the Federal Deposit Insurance Corporation (the "FDIC").
Bank and Trust was formed in 1934 through the consolidation of five banks. It is a Pennsylvania bank and trust company and member of the Federal Reserve System with 46 offices in Cambria, Somerset, Bedford, Indiana, Armstrong, Butler, Allegheny, and Westmoreland Counties. At December 31, 1996, its assets totaled $866 million.
Laurel is a Pennsylvania bank and trust company and a member of the Federal Reserve System, with total assets of $230 million at December 31, 1996. Laurel operates 11 offices in Cambria, Blair and Indiana Counties.
Fayette is a Pennsylvania bank and trust company and a member of the Federal Reserve system. Fayette conducts business at 12 offices in Fayette, Washington, Allegheny and Greene Counties. Its assets totaled $355 million at December 31, 1996.
BT Management Trust Company, located in Johnstown, is a Pennsylvania- chartered trust company formed on April 30, 1990. BT Management Trust Company resulted from the consolidation of the trust business of the Banks.
Moxham Community Development Corporation was organized in 1992 to conduct community development activities. It is a for-profit Pennsylvania corporation conducting activities consisting of equity investments as a limited partner in various housing developments.
The Registrant and the Banks are subject to competition in all aspects of their businesses from banks as well as other financial institutions, including savings and loan associations, savings banks, finance companies, credit unions, money market mutual funds, brokerage firms, investment companies, credit companies and insurance companies. They also compete with nonfinancial institutions, including retail stores that maintain their own credit programs, and with governmental agencies that make loans available to certain borrowers. Some of the Registrant's competitors are larger and have greater financial resources and facilities than the Registrant.
As of December 31, 1996, the Registrant, the Banks, BT Management Trust Company and the Registrant's other subsidiaries had a total of 764 full time equivalent banking and administrative employees. The Registrant's executive offices are located at 551 Main Street, P.O. Box 1146, Johnstown, Pennsylvania 15907-1146. Its telephone number is (814) 532-3801.
Recent and Pending Acquisitions - -------------------------------
Merger and acquisition activities of the Registrant are detailed in "Note 2-Acquisitions" of the "Notes to Consolidated Financial Statements" included on pages 19 and 20 of the 1996 Annual Report to Shareholders, which is incorporated herein by reference.
Item 2
Item 2 Properties - ------ ----------
The executive offices of the Registrant are located at 551 Main Street, Johnstown, Pennsylvania, in an office building owned by Bedford Associates, Inc. The building is occupied by the Registrant, BT Management Trust Company, and other unrelated business concerns. In addition, Bank and Trust owns a seven-story building located on Clinton Street in Johnstown and is using the building as a storage facility.
The Banks operate 69 full-service banking offices, 51 of which are owned by the Banks free of liens and encumbrances. All properties and buildings are in good condition and are continually maintained against normal wear and tear. The remaining 18 offices are operated under leases which, including renewal options, expire at various times between 1997 and 2025. Bedford Associates, Inc. owns 4 of the 18 leased properties, which are leased to the Banks as community banking offices. All properties of Bedford Associates, Inc. have been recently purchased (1983 or later), and the buildings are either newly constructed or have recently undergone major renovation. In June 1996, Bank and Trust acquired one banking office in The Armstrong County Trust Company acquisition. Additionally, 12 banking offices were acquired by BT in connection with the Moxham merger in June 1996. In conjunction with the merger, four of these branches closed during the third quarter of 1996 along with two branches of Bank and Trust and one branch of Laurel as a result of duplicate service areas.
Item 3
Item 3 Legal Proceedings - ------ -----------------
Information required to be furnished pursuant to this Item is set forth on page 25 of the 1996 Annual Report in Note 9 of the "Notes to Consolidated Financial Statements" under the caption "Litigation".
Item 4
Item 4 Submission of Matters to a Vote of Security Holders - ------ --------------------------------------------------- None.
Executive Officers of the Registrant - ------------------------------------
Set forth below are the names of and certain information with respect to the executive officers of the Registrant. Pursuant to the Registrant's By- Laws, officers serve at the pleasure of the Board. There are no family relationships between any such persons.
Name Age Positions and Offices Held ---- --- --------------------------
John H. Anderson 46 Chairman, Chief Executive Officer and Director of the Registrant and of Bank and Trust.
Steven C. Ackmann 45 President and Chief Operating Officer of the Registrant
Eric F. Rummel 44 Vice Chairman of the Registrant, President of Bank and Trust.
Carl J. Motter, Jr. 59 Vice Chairman of the Registrant.
J. William Smith 49 Vice Chairman of the Registrant.
Mark L. Sollenberger 43 Executive Vice President, Treasurer and Assistant Secretary of the Registrant. Executive Vice President and Treasurer of Bank and Trust. Treasurer and Assistant Secretary of BT Management Trust Company.
Laura L. Roth 34 Secretary and Assistant Treasurer of the Registrant, Bank and Trust and BT Management Trust Company.
William E. Ritenour 34 Vice President of the Registrant
John H. Anderson has served as Chairman and Chief Executive Officer of ---------------- the Registrant since 1995. He served as Chairman, President and Chief Executive Officer of the Registrant from 1993 to 1995. He served as President and Chief Operating Officer of the Registrant from 1992 to 1993 and as Vice Chairman from 1991 to 1992. He served as President of Bank and Trust from 1990 to 1991. He served as Executive Vice President of the Registrant during 1989. From 1986 to 1989 he served as Executive Vice President of Bank and Trust.
Steven C. Ackmann has served as President and Chief Operating Officer ----------------- of the Registrant since 1995. He served as a Vice Chairman of the Registrant from 1992 to 1995. He served as Executive Vice President of the Registrant from 1990 to 1992. He served as Senior Vice President of Fayette from 1988 to 1990.
Eric F. Rummel has served as Vice Chairman of the Registrant since 1996 -------------- and President of Bank and Trust since 1995. He served as President of Laurel from 1991 to 1995. He served as Executive Vice President of the Registrant in 1991 and of Bank and Trust from 1989 to 1991. He served as Senior Vice President of Bank and Trust from 1988 to 1989.
Carl J. Motter has served as a Vice Chairman of the Registrant since -------------- 1992. He served as Executive Vice President and Treasurer of the Registrant from 1983 to 1992 and of Bank and Trust from 1980 to 1992. He served as Treasurer and Assistant Secretary of BT Management Trust from 1990 to 1992.
J. William Smith has served as Vice Chairman of the Registrant since ---------------- 1996. He served as President and Chief Executive Officer of the former Moxham Bank Corporation from 1986 to 1996.
Mark L. Sollenberger has served as Executive Vice President, Treasurer -------------------- and Assistant Secretary of the Registrant since 1995 and Executive Vice President and Treasurer of Bank and Trust since 1992. He served as Executive Vice President and Treasurer of the Registrant from 1992 to 1995. He served as Senior Vice President and Comptroller of the Registrant from 1991 to 1992. He served as Vice President and Comptroller of the Registrant since 1986 and of Bank and Trust since 1985. He has served as Treasurer and Assistant Secretary of BT Management Trust Company since 1992.
Laura L. Roth has served as Secretary and Assistant Treasurer of the ------------- Registrant, Bank and Trust and BT Management Trust Company since 1995. She served as Assistant Secretary and Assistant Treasurer of the Registrant from 1991 to 1995. She served as Assistant Secretary of the Registrant and of Bank and Trust from 1986 to 1991.
William E. Ritenour has served as Vice President of the Registrant since ------------------- 1996. He served as Controller of Fayette from 1987 to 1996.
Part II
Information required to be furnished pursuant to Part II of this report is set forth in the 1996 Annual Report under the captions and on the pages indicated below, and is incorporated herein by reference. Certain information in "Management's Discussion and Analysis" and other statements contained in this report which are not historical facts may be forward-looking statements that involve risks and uncertainties. Such statements are subject to important factors that could cause actual results to differ materially from those contemplated by such statements, including without limitation, the effect of changing regional and national economic conditions; changes in interest rates; credit risks of commercial, real estate, consumer and other lending activities; changes in federal and state regulations; the presence in the Registrant's market area of competitors with greater financial resources than the Registrant; or other unanticipated external developments materially impacting the Registrant's operational and financial performance.
Page in Caption in 1996 Annual Report Annual Report ----------------------------- -------------
Item 5
Item 5 Market for the Registrant's Common - ------ Equity and Related Stockholder Matters --------------------------------------
Market Price and Cash Dividends 31
Dividend Restrictions 26
Item 6
Item 6 Selected Financial Data - ------ -----------------------
Selected Consolidated Financial Data 30
Item 7
Item 7 Management's Discussion and Analysis - ------ of Financial Condition and Results of Operations -------------------------------------
Management's Discussion and Analysis of Financial Condition and Results of Operations 31-41
Item 8
Item 8 Financial Statements and Supplementary Data - ------ -------------------------------------------
Report of Independent Accountants 12
Consolidated Balance Sheet 13
Consolidated Statement of Income 14
Consolidated Statement of Cash Flows 15
Consolidated Statement of Changes in Shareholders' Equity 16
Notes to Consolidated Financial Statements 17-29
Supplemental Financial Data 29
Item 9
Item 9 Changes in and Disagreements with Accountants on Accounting and - ------ Financial Disclosure --------------------------------------------------------------- None
Part III
Item 10
Item 10 Directors and Executive Officers of the Registrant - ------- --------------------------------------------------
Information required to be furnished pursuant to this Item regarding directors of the Registrant is set forth in the 1997 Proxy Statement under the caption "Election of Directors," and is incorporated herein by reference. Information required to be furnished pursuant to this Item regarding delinquent filers is set forth in the 1997 Proxy Statement under the caption "Compliance with Section 16 (a) of the Securities Exchange Act of 1934" and is incorporated herein by reference. Information required to be furnished pursuant to this Item regarding executive officers of the Registrant is set forth in Part I of this Report and is incorporated herein by reference.
Item 11
Item 11 Executive Compensation - ------- ----------------------
Information required to be furnished pursuant to this Item is set forth in the 1997 Proxy Statement under the captions "Executive Compensation" and "Election of Directors -- Directors' Compensation," and is incorporated herein by reference. The "Executive Committee Report on Compensation" set forth in the 1997 Proxy Statement is specifically not incorporated herein by reference.
Item 12
Item 12 Security Ownership of Certain Beneficial Owners and Management - ------- --------------------------------------------------------------
Information required to be furnished pursuant to this Item is set forth in the 1997 Proxy Statement under the captions "Election of Directors," "Executive Compensation" and "Stock Ownership" and is incorporated herein by reference.
Item 13
Item 13 Certain Relationships and Related Transactions - ------- ----------------------------------------------
Information required to be furnished pursuant to this Item is set forth in the 1997 Proxy Statement under the caption "Certain Relationships and Transactions" and is incorporated herein by reference.
Part IV
Item 14
Item 14 Exhibits, Financial Statement Schedules and Reports on Form 8-K - ------- ---------------------------------------------------------------
(a) (1) Financial Statements --------------------
The consolidated financial statements of BT Financial Corporation and affiliates together with the report of Coopers & Lybrand L.L.P. dated January 21, 1997, are described herein in Part II, Item 8 - Financial Statements and Supplementary Data appear on pages 13 through 29 of the 1996 Annual Report and are incorporated herein by reference.
(2) Financial Statement Schedules -----------------------------
All financial statement schedules are omitted because they are not required, are not applicable or the required information is given in the consolidated financial statements or notes thereto.
(3) Exhibits: --------
The index to exhibits is on page 16.
(b) Reports on Form 8-K: -------------------
No reports on Form 8-K have been filed by the Registrant during the quarter for which this report is filed.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
BT FINANCIAL CORPORATION ------------------------- (Registrant)
By: /s/ John H. Anderson Date: March 26, 1997 ----------------------------- ---------------- Chairman, and Chief Executive Officer and Director
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
Principal Executive Officer:
/s/ John H. Anderson Date: March 26, 1997 ----------------------------- ---------------- John H. Anderson Chairman, and Chief Executive Officer and Director
Principal Financial Officer:
/s/ Mark L. Sollenberger Date: March 26, 1997 ----------------------------- ---------------- Mark L. Sollenberger Executive Vice President, Treasurer, and Assistant Secretary
Principal Accounting Officer:
/s/ William E. Ritenour Date: March 26, 1997 ---------------------------- ---------------- William E. Ritenour Vice President
Directors:
Date: March 26, 1997 - ------------------------------ ---------------- G. Scott Baton II
/s/ Martin L. Bearer Date: March 26, 1997 - ------------------------------ ---------------- Martin L. Bearer
/s/ John C. Cwik, M.D. Date: March 26, 1997 - ------------------------------ ---------------- John C. Cwik, M.D.
Date: March 26, 1997 - ------------------------------ ---------------- Bruno DeGol
/s/ Louis G. Galliker Date: March 26, 1997 - ------------------------------ ---------------- Louis G. Galliker
/s/ William B. Kania Date: March 26, 1997 - ------------------------------ ---------------- William B. Kania
Date: March 26, 1997 - ------------------------------ ---------------- L. Robert Kimball
/s/ Edward L. Mears Date: March 26, 1997 - ------------------------------ ---------------- Edward L. Mears
/s/ Roger S. Nave Date: March 26, 1997 - ------------------------------ ---------------- Roger S. Nave
/s/ Ethel J. Otrosina Date: March 26, 1997 - ------------------------------ ---------------- Ethel J. Otrosina
Date: March 26, 1997 - ------------------------------ ---------------- Robert G. Salathe, Jr.
/s/ William R. Snoddy Date: March 26, 1997 - ------------------------------ ---------------- William R. Snoddy
/s/ Gerald W. Swatsworth Date: March 26, 1997 - ------------------------------ ---------------- Gerald W. Swatsworth
/s/ W. A. Thomas Date: March 26, 1997 - ------------------------------ ---------------- W. A. Thomas
/s/ Rowland H. Tibbott, Jr. Date: March 26, 1997 - ------------------------------ ---------------- Rowland H. Tibbott, Jr.
/s/ Nelson G. Wheeler Date: March 26, 1997 - ------------------------------ ---------------- Nelson G. Wheeler
/s/ Thomas A. Young Date: March 26, 1997 - ------------------------------ ---------------- Thomas A. Young
EXHIBIT INDEX -----
The following Exhibits are filed as a part of this Report. Documents other than those designated as being filed herewith are incorporated herein by reference. Documents incorporated by reference to an Annual Report on Form 10-K or a Quarterly Report on Form 10-Q are at Securities and Exchange Commission File No. 0-12377.
Exhibit Prior Filing or Sequential Number Description Page No. Herein - ------- ----------- --------------------------
2.1 Agreement and Plan of Incorporated by reference Reorganization dated as to Exhibit 2.1 to BT of October 24, 1995 by and Financial Corporation among BT Financial Registration Statement on Corporation Johnstown Bank Form S-4 (No. 333-01797). and Trust Company and The Armstrong County Trust Company.
2.2 Agreement and Plan of Incorporated by reference Reorganization by and to Exhibit 2 to current between BT Financial Report on Form 8-K dated Corporation and Moxham January 12, 1996. Bank Corporation.
3.1 Amended and Restated Incorporated by reference Articles of Incorporation to BT Financial Corporation of BT Financial Registration Statement on Corporation. Form S-4 (No. 33-69112).
3.2 By-Laws of BT Financial Incorporated by reference Corporation. to BT Financial Corporation Registration Statement on Form S-4 (No. 33-69112).
4.1 Loan Agreement dated Not filed. In accordance December 14, 1995, between with paragraph (b)(4)(iii)(A) Mellon Bank, N.A. and BT of Item 601 of Regulation S-K, Financial Corporation. BT Financial Corporation hereby agrees to furnish a copy of this instrument to the Commission upon request.
10.1 Supplemental Benefit Plan Incorporated by of BT Financial Corporation reference to Exhibit dated June 22, 1994.* 10.1 to BT Financial Corporation's Annual Report on Form 10-K for the year ended December 31, 1994.
Exhibit Prior Filing or Sequential Number Description Page No. Herein - ------- ----------- --------------------------
10.2 Key Employee Incentive Filed herewith. Compensation Plan of BT Financial Corporation dated July 24, 1996.*
10.3 Moxham Bank Corporation Filed herewith. Executive Retirement Plan dated January 1, 1987, as amended and restated.
11 Computation of Net Income Filed herewith. Per Share
13.1 All portions of the BT Filed herewith. Financial Corporation 1996 Annual Report to Shareholders that are incorporated herein by reference.
21.1 Subsidiaries of the Filed herewith. Registrant.
23.1 Consent of Coopers & Filed herewith. Lybrand LLP,independent accountants for the Registrant.
23.2 Consent of Barnes, Saly & Filed herewith. Company, independent accountants for the former Moxham Bank Corporation
27.1 Financial Data Schedule Filed herewith.
27.2 Restated Financial Data Filed herewith. Schedule
99.1 Report of Barnes, Saly & Filed herewith. Company on Moxham Bank Corporation's Financial Statements as of December 31, 1995 and for each of the years in the two year period ended December 31, 1995.
* Indicates exhibit is a management contract or compensation plan or arrangement.
The Registrant will furnish to requesting shareholders a copy of any exhibit(s) listed above upon payment of $5.00 plus $0.10 per page to cover Registrant's expenses in furnishing such exhibit(s). Requests should be directed in writing to Laura L. Roth, Secretary, BT Financial Corporation, 551 Main Street, P. O. Box 1146, Johnstown, Pennsylvania 15907-1146.