Item 1. Business.
History and Business - --------------------
Harleysville National Corporation (the "Corporation"), a Pennsylvania business corporation, was incorporated in June 1982. On January 1, 1983, the Corporation acquired all of the outstanding common stock of Harleysville National Bank and Trust Company ("Harleysville") at which time Harleysville became a wholly-owned subsidiary of the Corporation. On February 13, 1991, the Corporation acquired all of the outstanding common stock of The Citizens National Bank of Lansford ("Citizens"). On June 1, 1992, the Corporation acquired all of the outstanding stock of Summit Hill Trust Company ("Summit Hill"). On September 25, 1992, Summit Hill merged into Citizens and is now operating as a branch office of Citizens. On September 7, 1995, the Corporation, Citizens and Farmers and Merchants Bank ("Farmers") executed an Agreement and Plan of Reorganization and an Agreement and Plan of Merger. On March 1, 1996, the Corporation acquired all of the outstanding stock of Farmers and merged it with and into Citizens. On July 1, 1994 the Corporation acquired all of the outstanding stock of Security National Bank ("Security"). The Corporation is a three-bank holding company providing financial services through its Bank subsidiaries. Since commencing operations, the Corporation's business has consisted primarily of managing Harleysville, Citizens and Security (collectively the "Banks"), and its principal source of income has been dividends paid by the Banks. The Corporation is registered as a bank holding company under the Bank Holding Company Act of 1956, as amended (the "Bank Holding Company Act"). As of December 31, 1995, the Company had total consolidated assets, deposits and shareholders' equity of $874,145,992, $741,218,395 and $77,516,176 respectively.
Harleysville, which was established in 1909, Citizens, which was established in 1903, and Security, which was established in 1988, are national banking associations under the supervision of the Comptroller of the Currency of the United States of America. The Corporation's and Harleysville's legal headquarters are located at 483 Main Street, Harleysville, Pennsylvania 19438. Citizens' legal headquarters is located at 13-15 West Ridge Street, Lansford, Pennsylvania 18232. Security's legal headquarters is located at One Security Plaza, Pottstown, Pennsylvania 19464.
The Banks engage in the full-service commercial banking and trust business, including accepting time and demand deposits, making secured and unsecured commercial and consumer loans, financing commercial transactions, making construction and mortgage loans and performing corporate pension and personal trust services. Their deposits are insured by the Federal Deposit Insurance Corporation (FDIC) to the maximum extent provided by law.
The Banks enjoy a stable base of core deposits and are leading community banks in their service areas. The Banks believe they have gained their position as a result of a customer oriented philosophy and a strong commitment to service. Senior management has made the development of a sales orientation throughout the Banks one of their highest priorities and emphasizes this objective with extensive training and sales incentive programs that the Company believes are unusual for community banks. The Banks maintain close contact with the local business community to monitor commercial lending needs and believes they respond to customer requests quickly and with flexibility. Management believes these competitive strengths are reflected in the Corporation's results of operations.
The Banks have twenty-two (22) offices located in Montgomery, Bucks and Carbon Counties, 12 of which are owned by the Banks and 10 of which are leased from third parties.
As of December 31, 1995, the Corporation and the Banks employed approximately 350 full-time and full-time equivalent persons. The Corporation provides a variety of employment benefits and considers its relationships with its employees to be satisfactory.
Competition - -----------
The Banks compete actively with other eastern Pennsylvania financial institutions, many larger than the Banks, as well as with financial and non-financial institutions headquartered elsewhere. The Banks are generally competitive with all institutions in their service areas with respect to interest rates paid on time and savings deposits, service charges on deposit accounts and interest rates charged on loans. At December 31, 1995, Harleysville's legal lending limit to a single customer was $9,650,000 and Citizens' and Security's legal lending limits to a single customer were $1,815,000 and $590,000, respectively. Many of the institutions with which the Banks compete are able to lend significantly more than these amounts to a single customer.
Supervision and Regulation - The Registrant - -------------------------------------------
The Registrant is subject to the provisions of the Bank Holding Company Act of 1956, as amended (the "Bank Holding Company Act"), and to supervision by the Federal Reserve Board. The Bank Holding Company Act requires the Registrant to secure the prior approval of the Federal Reserve Board before it owns or controls, directly or indirectly, more than five percent (5%) of the voting shares or substantially all of the assets of any institution, including another bank. In addition, the Bank Holding Company Act has been amended by the Riegle-Neal Interstate Banking and Branching Efficiency Act which permits bank holding companies to acquire a bank located in any state subject to certain limitation and restrictions which are more fully described below.
A bank holding company is prohibited from engaging in or acquiring direct or indirect control of more than five percent (5%) of the voting shares of any company engaged in non-banking activities unless the Federal Reserve Board, by order or regulation, has found such activities to be so closely related to banking or managing or controlling banks as to be a proper incident thereto. In making this determination, the Federal Reserve Board considers whether the performance of these activities by a bank holding company would offer benefits to the public that outweigh possible adverse effects.
Federal law also prohibits acquisitions of control of a bank holding company without prior notice to certain federal bank regulators. Control is defined for this purpose as the power, directly or indirectly, to direct the management or policies of the bank or bank holding company or to vote twenty-five percent (25%) or more of any class of voting securities.
Subsidiary banks of a bank holding company are subject to certain restrictions imposed by the Federal Reserve Act on any extensions of credit to the bank holding company or any of its subsidiaries, on investments in the stock or other securities of the bank holding company and on taking of such stock or securities of the bank holding company and on taking of such stock or securities as collateral for loans to any borrower.
Permitted Activities - --------------------
The Federal Reserve Board permits bank holding companies to engage in certain activities so closely related to banking or managing or controlling banks as to be proper incident thereto. Other than making an equity investment in a low to moderate income housing limited partnership, the Registrant does not at this time engage in any other permissible activities, nor does the Registrant have any current plans to engage in any other permissible activities in the foreseeable future.
Legislation and Regulatory Changes - ----------------------------------
From time to time, legislation is enacted which has the effect of increasing the cost of doing business, limiting or expanding permissible activities or affecting the competitive balance between banks and other financial institutions. Proposals to change the laws and regulations governing the operations and taxation of banks, bank holding companies and other financial institutions are frequently made in Congress, and before various bank regulatory agencies. No prediction can be made as to the likelihood of any major changes or the impact such changes might have on the Registrant and its subsidiaries. Certain changes of potential significance to the Registrant which have been enacted recently and others which are currently under consideration by Congress or various regulatory or professional agencies are discussed below.
The passage of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 and the Riegle Community Development and Regulatory Improvement Act may have a significant impact upon the Corporation. The key provisions pertain to interstate banking and interstate branching as well as a reduction in the regulatory burden on the banking industry. Since September 1995, bank holding companies may acquire banks in other states without regard to state law. In addition, banks can merge with other banks in another state beginning in June 1997. States may adopt laws preventing interstate branching but, if so, no out-of-state bank can establish a branch in such state and no banks in such state may branch outside the state. Pennsylvania recently amended the provisions of its banking code to authorize full interstate banking and branching under Pennsylvania law and to facilitate the operations of interstate banks in Pennsylvania. As a result of legal and industry changes, management predicts that consolidation will continue as the financial services industry strives for greater cost efficiencies and market share. Management believes that such consolidation may enhance its competitive position as a community bank.
The Interstate Banking and Branching Act also amends the International Banking Act to allow a foreign bank to establish and operate a federal branch or agency upon approval of the appropriate federal and state banking regulator. As a national bank, the Bank currently can relocate its main office across state lines by utilizing a provision in the National Bank Act which permits such relocation to a location not more than thirty miles from its existing main office. In effect, a national bank can thereby move across state lines as long as the relocation does not exceed thirty miles and also retain as branches the offices located in the original state.
The Federal Reserve Board, the FDIC, and the Comptroller of the Currency ("Comptroller") have issued certain risk-based capital guidelines. See pages 34 and 35 of Registrant's 1995 Annual Report, which is incorporated by reference herein, for information concerning the Registrant's capital.
Pending Legislation - -------------------
Various congressional bills and other proposals have proposed a sweeping overhaul of the banking system, including provisions for: limitations on deposit insurance coverage; changing the timing and method financial institutions use to pay for deposit insurance; expanding the power of banks by removing the restrictions on bank underwriting activities; tightening the regulation of bank derivatives activities; allowing commercial enterprises to own banks; and permitting bank holding companies to own affiliates that engage in securities, mutual funds and insurance activities.
There are numerous proposals before Congress to modify the financial services industry and the way commercial banks operate. However, it is difficult to determine at this time what effect such provisions may have until they are enacted into law. Except as specifically described on page 35 of the 1995 Annual Report to Shareholders, management believes that the effect of the provisions of the aforementioned legislation on the liquidity, capital resources, and results of operations of the Corporation will be immaterial. Management is not aware of any other current specific recommendations by regulatory authorities or proposed legislation which, if they were implemented, would have a material adverse effect upon the liquidity, capital resources, or results of operations, although the general cost of compliance with numerous and multiple federal and state laws and regulations does have, and in the future may have, a negative impact on the Corporation's results of operations.
Effects of Inflation - --------------------
Inflation has some impact on the Corporation's and the Banks' operating costs. Unlike many industrial companies, however, substantially all of the Banks' assets and liabilities are monetary in nature. As a result, interest rates have a more significant impact on the Corporation's and the Banks' performance than the general level of inflation. Over short periods of time, interest rates may not necessarily move in the same direction or in the same magnitude as prices of goods and services.
Effect of Government Monetary Policies - --------------------------------------
The earnings of the Registrant are and will be affected by domestic economic conditions and the monetary and fiscal policies of the United States government and its agencies. An important function of the Federal Reserve System is to regulate the money supply and interest rates. Among the instruments used to implement those objectives are open market operations in United States government securities and changes in reserve requirements against member bank deposits. These instruments are used in varying combinations to influence overall growth and distribution of bank loans, investments and deposits, and their use may also affect rates charged on loans or paid for deposits.
The Banks are members of the Federal Reserve System and, therefore, the policies and regulations of the Federal Reserve Board have a significant effect on its deposits, loans and investment growth, as well as the rate of interest earned and paid, and are expected to affect the Banks' operations in the future. The effect of such policies and regulations upon the future business and earnings of the Corporation and the Banks cannot be predicted.
Environmental Regulations - -------------------------
There are several federal and state statutes which regulate the obligations and liabilities of financial institutions pertaining to environmental issues. In addition to the potential for attachment of liability resulting from its own actions, a bank may be held liable under certain circumstances for the actions of its borrowers, or third parties, when such actions result in environmental problems on properties that collateralize loans held by the bank. Further, the liability has the potential to far exceed the original amount of the loan issued by the Bank. Currently, neither the Corporation nor the Banks are a party to any pending legal proceeding pursuant to any environmental statute, nor is the Corporation and the Banks aware of any circumstances which may give rise to liability under any such statute.
Supervision and Regulation - Banks - ----------------------------------
The operations of the Banks are subject to federal and state statutes applicable to banks chartered under the banking laws of the United States, to members of the Federal Reserve System and to banks whose deposits are insured by the Federal Deposit Insurance Corporation. The Banks' operations are also subject to regulations of the Comptroller of the Currency (Comptroller), the Federal Reserve Board and the FDIC. The primary supervisory authority of the Banks is the Comptroller, who regularly examines the Banks. The Comptroller has authority to prevent a national bank from engaging in unsafe or unsound practices in conducting its business.
Federal and state banking laws and regulations govern, among other things, the scope of a bank's business, the investments a bank may make, the reserves against deposits a bank must maintain, loans a bank makes and collateral it takes, the maximum interest rates a bank may pay on deposits, the activities of a bank with respect to mergers and consolidations and the establishment of branches.
As a subsidiary bank of a bank holding company, the Banks are subject to certain restrictions imposed by the Federal Reserve Act on any extensions of credit to the bank holding company or its subsidiaries, or investments in the stock or other securities as collateral for loans. The Federal Reserve Act and Federal Reserve Board regulations also place certain limitations and reporting requirements on extensions of credit by a bank to principal shareholders of its parent holding company, among others, and to related interests of such principal shareholders. In addition, such legislation and regulations may affect the terms upon which any person becoming a principal shareholder of a holding company may obtain credit from banks with which the subsidiary bank maintains a correspondent relationship.
FDIC - ----
Under the Federal Deposit Insurance Act, the Comptroller possesses the power to prohibit institutions regulated by it (such as the Banks) from engaging in any activity that would be an unsafe and unsound banking practice or would otherwise be in violation of the law.
CRA - ---
Under the Community Reinvestment Act of 1977, as amended ("CRA"), the Comptroller is required to assess the record of all financial institutions regulated by it to determine if these institutions are meeting the credit needs of the community (including low and moderate income neighborhoods) which they serve and to take this record into account in its evaluation of any application made by any of such institutions for, among other things, approval of a branch or other deposit facility, office relocation, a merger or an acquisition of bank shares. The Financial Institutions Reform, Recovery and Enforcement Act of 1989 amended the CRA to require, among other things, that the Comptroller make publicly available the evaluation of a bank's record of meeting the credit needs of its entire community, including low and moderate income neighborhoods. This evaluation will include a descriptive rating ("outstanding", "satisfactory", "needs to improve" or "substantial noncompliance") and a statement describing the basis for the rating. These ratings are publicly disclosed.
BSA - ---
Under the Bank Secrecy Act ("BSA"), banks and other financial institutions are required to report to the Internal Revenue Service currency transactions of more than $10,000 or multiple transactions of which the bank is aware in any one day that aggregate in excess of $10,000. Civil and criminal penalties are provided under the BSA for failure to file a required report, for failure to supply information required by the BSA or for filing a false or fraudulent report.
FDICIA - ------
Capital Categories: On December 19, 1991, the Federal Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA") became law. Under FDICIA, institutions must be classified, based on their risk-based capital ratios into one of five defined categories, as illustrated below (well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized and critically undercapitalized).
Total Tier 1 Under a Risk- Risk- Tier 1 Capital Based Based Leverage Order or Ratio Ratio Ratio Directive
CAPITAL CATEGORY Well capitalized >10.0 >6.0 >5.0 NO Adequately capitalized > 8.0 >4.0 >4.0* Undercapitalized < 8.0 <4.0 <4.0* Significantly Under- capitalized < 6.0 <3.0 <3.0 Critically Under- capitalized <2.0
*3.0 for those banks having the highest available regulatory rating.
Prompt Corrective Action: In the event an institution's capital deteriorates to the undercapitalized category or below, FDICIA prescribes an increasing amount of regulatory intervention, including: (1) the institution of a capital restoration plan and a guarantee of the plan by a parent institution; and (2) the placement of a hold on increases in assets, number of branches or lines of business. If capital has reached the significantly or critically undercapitalized levels, further material restrictions can be imposed, including restrictions on interest payable on accounts, dismissal of management and (in critically undercapitalized situations) appointment of a receiver. For well capitalized institutions, FDICIA provides authority for regulatory intervention where the institution is deemed to be engaging in unsafe or unsound practices or receives a less than satisfactory examination report rating for asset quality, management, earnings or liquidity. All but well capitalized institutions are prohibited from accepting brokered deposits without prior regulatory approval.
Operational Controls: Under FDICIA, financial institutions are subject to increased regulatory scrutiny and must comply with certain operational, managerial and compensation standards to be developed by Federal Reserve Board regulations. FDICIA also requires the regulators to issue new rules establishing certain minimum standards to which an institution must adhere including standards requiring a minimum ratio of classified assets to capital, minimum earnings necessary to absorb losses and minimum ratio of market value to book value for publicly held institutions. Additional regulations are required to be developed relating to internal controls, loan documentation, credit underwriting, interest rate exposure, asset growth and excessive compensation, fees and benefits.
Examinations and Audits: Annual full-scope, on site regulatory examinations are required for all the FDIC- insured institutions except institutions with assets under $100 million which are well capitalized, well-managed and not subject to a recent change in control, in which case, the examination period is every eighteen (18) months. Banks with total assets of $500 million or more, as of the beginning of fiscal year 1993, are required to submit to their supervising federal and state banking agencies a publicly available annual audit report. The independent accountants of such bank are required to attest to the accuracy of management's report. The accountants also are required to monitor management's compliance with governing laws and regulations. In addition, such banks also are required to have an independent audit committee composed of outside directors who are independent of management, to review with management and the independent accountants, the reports that must be submitted to the bank regulatory agencies. If the independent accountants resign or are dismissed, written notification must be given to the bank's supervising government banking agencies. These accounting and reporting reforms do not apply to an institution such as a bank with total assets at the beginning of its fiscal year of less than $500 million, such as Citizens or Security.
Real Estate Loans: FDICIA also requires that banking agencies reintroduce loan-to-value ("LTV") ratio regulations which were previously repealed by the 1982 Act. LTVs limit the amount of money a financial institution may lend to a borrower, when the loan is secured by real estate, to no more than a percentage, set by regulation, of the value of the real estate.
Truth-In-Savings: A separate subtitle within FDICIA, called the "Bank Enterprise Act of 1991", requires "truth-in- savings" on consumer deposit accounts so that consumers can make meaningful comparisons between the competing claims of banks with regard to deposit accounts and products. Under this provision, the Bank is required to provide information to depositors concerning the terms of their deposit accounts, and in particular, to disclose the annual percentage yield. The operational cost of complying with the Truth-In-Savings law had no material impact on liquidity, capital resources or reported results of operations.
While the overall impact of fully implementing all provisions of the FDICIA cannot be accurately calculated, Management believes that full implementation of the FDICIA had no material impact on liquidity, capital resources or reported results of operation in future periods.
Other: From time to time, various types of federal and state legislation have been proposed that could result in additional regulation of, and restriction on, the business of the Banks. It cannot be predicted whether any such legislation will be adopted or, if adopted, how such legislation would affect the business of the Banks. As a consequence of the extensive regulation of commercial banking activities in the United States, the Banks' business is particularly susceptible to being affected by federal legislation and regulations that may increase the costs of doing business.
Statistical Data - ----------------
The information for this Item is incorporated by reference to pages 23 through 37 of the Company's Annual Report to Shareholders for the year ended December 31, 1995, which is included as Exhibit (13) to this Form 10-K Report.
Item 2.
Item 2. Properties. - -------------------
The principal executive offices of the Company and of Harleysville are located in Harleysville, Pennsylvania in a two-story office building owned by Harleysville which was built in 1929. Harleysville also owns the buildings in which nine of its branches are located and leases space for the other seven branches from unaffiliated third parties under leases expiring at various times through 2012. The principal executive offices of Citizens are located in Lansford, Pennsylvania in a two-story office building owned by Citizens. Citizens also owns the buildings where the Summit Hill and Lehighton branches are located. The principal executive offices of Security are located in Pottstown, Pennsylvania in a building leased by Security. Security also leases its East End and North End Branches.
Office Office Location Owned/Leased Harleysville 483 Main Street Owned Harleysville Pa
Skippack Route 73 Owned Skippack Pa
Limerick Ridge Pike Owned Limerick Pa
North Penn Welsh & North Wales Rd Owned North Wales Pa
Gilbertsville Gilbertsville Shopping Leased Gilbertsville Pa
Hatfield Snyder Square Leased Hatfield Pa
North Broad North Broad Street Owned Lansdale Pa
Marketplace Marketplace Shopping Leased Lansdale Pa
Normandy Farms Morris Road Leased Blue Bell Pa
Horsham Babylon Business Center Leased Horsham Pa
Meadowood Route 73 Leased Worcester Pa
Collegeville 364 Main Street Owned Collegeville Pa
Sellersville 209 North Main St Owned Sellersville Pa
Trainers Corner Trainers Corner Center Leased Quakertown Pa
Quakertown Main 224 West Broad St Owned Quakertown PA
Red Hill 400 Main Street Owned Red Hill PA
Citizens 13-15 West Ridge Street Owned Lansford PA
Summit Hill 2 East Ludlow Street Owned Summit Hill PA
Lehighton 904 Blakeslee Blvd Owned Lehighton PA
Pottstown One Security Plaza Leased Pottstown PA
Pottstown 1450 East High Street Leased Pottstown PA
Pottstown Charlotte & Mervine Sts. Leased Pottstown PA
All of the above properties are in good condition and are adequate for the Registrant's and the Banks' purposes.
Item 3.
Item 3. Legal Proceedings. - --------------------------
Management, based on consultation with the Corporation's legal counsel, is not aware of any litigation that would have a material adverse effect on the consolidated financial position of the Company. There are no proceedings pending other than the ordinary routine litigation incident to the business of the Corporation and its subsidiaries - Harleysville National Bank and Trust Company, The Citizens National Bank of Lansford and Security National Bank. In addition, no material proceedings are pending or are known to be threatened or contemplated against the Corporation and the Banks by government authorities.
Item 4.
Item 4. Submission of Matters to a Vote of Security Holders. - ------------------------------------------------------------
No matter was submitted during the fourth quarter of 1995 to a vote of holders of the Company's Common Stock.
PART II
Item 5.
Item 5. Market for the Registrant's Common Stock and Related Shareholder Matters. - -------------------------------------------------------------
The information for this Item is incorporated by reference to pages 8 and 18 of the Corporation's Annual Report to Shareholders for the year ended December 31, 1995, which is included as Exhibit (13) to this Form 10-K Report.
Item 6.
Item 6. Selected Financial Data. - --------------------------------
The information for this Item is incorporated by reference to pages 23 and 37 of the Corporation's Annual Report to Shareholders for the year ended December 31, 1995, which is included as Exhibit (13) to this Form 10-K Report.
Item 7.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. - ------------------------------------------------------------------------
The information for this Item is incorporated by reference to pages 23 through 36 of the Corporation's Annual Report to Shareholders for the year ended December 31, 1995, which is included as Exhibit (13) to this Form 10-K Report.
Item 8.
Item 8. Financial Statements and Supplementary Data. - ----------------------------------------------------
The information for this Item is incorporated by reference to pages 8 through 22 of the Corporation's Annual Report to Shareholders for the year ended December 31, 1995, which is included as Exhibit (13) to this Form 10-K Report.
Item 9.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. - ------------------------------------------------------------------------
The information for this Item is incorporated by reference to pages 18 and 19 of the Registrant's Definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held April 9, 1996.
PART III
Item 10.
Item 10. Directors and Executive Officers of the Registrant. - ------------------------------------------------------------
The information for this Item with respect to the Corporation's directors is incorporated by reference to pages 3 through 7 of the Corporation's Definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held April 9, 1996.
Executive Officers of Registrant - -------------------------------- Name Age Position
Walter E. Daller, Jr. 56 President and Chief Executive Officer of the Company and of Harleysville
James W. Hamilton 49 Senior Vice President and Senior Trust Officer of Harleysville
Demetra M. Takes 45 Executive Vice President and Chief Operating Officer of Harleysville
Frank J. Lochetto 48 Senior Vice President and Senior Lending Officer of Harleysville
Vernon L. Hunsberger 47 Treasurer of the Company, Senior Vice President/CFO and Cashier of Harleysville
Fred C. Reim, Jr. 52 Senior Vice President of Harleysville since August 1993; Senior Vice President of First Valley Bank from December 1990 to August 1993
Henry R. Gehman 60 Vice President of Harleysville
Jo Ann M. Bynon 44 Secretary of the Company
Dennis L. Detwiler 48 Vice President of Harleysville
Bruce D. Fellman 49 Vice President of Harleysville
Thomas L. Spence 49 Vice President of Harleysville
Robert L. Reilly 46 Vice President of Harleysville
David R. Crews 45 Vice President of Harleysville
Larry E. Nolt 50 Vice President and Trust Officer of Harleysville since July 1993; Trust Officer of Harleysville from August 1991 to July 1993; Trust Officer of Union National Bank of Souderton for 4 years prior thereto
Mikkalya W. Walton 40 Vice President of Loan Administration of Harleysville since July 1994; Vice President Security National Bank September 1991 to June 1994; Assistant Vice President Mellon Bank January 1990 to August 1991
Gregg J. Wagner 35 Vice President and Comptroller of Harleysville National Bank since December 1994; Senior Vice President Security National Bank March 1992 to November 1994; Vice President and Comptroller Bryn Mawr Trust Company December 1989 to February 1992
Harry T. Weierbach 51 Vice President of Investments of Harleysville since December 1995; Assistant Vice President of Harleysville from June 1994 to December 1995; Vice President of Investments of Continental Bank from
Thomas D. Oleksa 42 President and Chief Executive Officer of Citizens
Martha A. Rex 47 Vice President and Cashier of Citizens
Maurice Infante 56 Vice President Consumer Lending of Citizens since April 1994; Assistant Vice President Consumer Lending of Citizens December 1991 to March 1994; Vice President Home Savings Association of Pennsylvania January 1988 to November 1991
Raymond H. Melcher 44 President and Chief Executive Officer of Security since November 1994; Executive Vice President, Chief Operating Officer Hi-Tech Connections 1990 to 1994; Executive Vice President Keystone Financial 1988 to 1990
Allen R. Loeb 47 Vice President of Lending of Security since April 1995; Vice President of Lending National Penn Bank from April 1994 to April 1995
Item 11.
Item 11. Executive Compensation. - --------------------------------
The information for this Item is incorporated by reference to pages 7 through 13 of the Corporation's Definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held April 9, 1996.
Item 12.
Item 12. Security Ownership of Certain Beneficial Owners and Management. - ------------------------------------------------------------------------
The information for this Item is incorporated by reference to pages 3 through 4 of the Corporation's Definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held April 9, 1996.
Item 13.
Item 13. Certain Relationships and Related Transactions. - --------------------------------------------------------
The information for this Item is incorporated by reference to page 18 of the Corporation's Definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held April 9, 1996, and to page 16 of the Corporation's Annual Report to Shareholders for the year ended December 31, 1995, which is included as Exhibit (13) to this form 10- K Report.
PART IV
Item 14.
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K. - -------------------------------------------------------------------------
(a) Financial Statements, Financial Statement Schedules and Exhibits Filed:
(1) Consolidated Financial Statements Page
Harleysville National Corporation and Subsidiary: Consolidated Balance Sheets as of December 31, 1995 and 1994 9* Consolidated Statements of Income for the Years Ended December 31, 1995, 1994 and 1993 10* Consolidated Statements of Shareholders' Equity for the Years Ended December 31, 1995, 1994 and 1993 11* Consolidated Statements of Cash Flows for the Years Ended December 31, 1995, 1994 and 1993 12* Notes to Consolidated Financial Statements 13-22* Independent Auditors' Report 8*
(2) Financial Statement Schedules
None
All other schedules are omitted since they are not required, not applicable or the information is included in the consolidated financial statements or notes thereto.
- ---------------------------------------------------------------- *Refers to the respective page of Harleysville National Corporation's 1995 Annual Report to Shareholders. The Consolidated Financial Statements and Notes to Consolidated Financial Statements and Auditor's Report thereon on pages 8 to 22 are incorporated by reference. With the exception of the portions of such Annual Report specifically incorporated by reference in this Item and in Items 1, 5, 6, 7 and 8, such Annual Report shall not be deemed filed as part of this Form 10-K Report or otherwise subject to the liabilities of Section 18 of the Securities Exchange Act of 1934.
(3) Exhibits
Exhibit No. Description of Exhibits - ---------- -----------------------
(3.1) Articles of Incorporation as amended were previously filed with the Commission on December 14, 1995 as Exhibit 3a to Registration Statement 33-65021 and is hereby incorporated by reference
(3.2) Amended By-laws of the Registrant were previously filed with the Commission on December 14, 1995 as Exhibit 3b to registration statement 33-65021 and is hereby incorporated by reference
(13) 1995 Annual Report to Shareholders (this document is filed only to the extent of pages 8 through 37 which are incorporated by reference herein.)
(21) Subsidiaries of Registrant
(23) (a) Consent of Grant Thornton LLP Independent Certified Public Accountants
(b) Consent of KPMG Peat Marwick LLP Independent Certified Public Accountants
(27) Financial Data Schedule.
(99) Additional Exhibits
(a) Report of Independent Certified Public Accountants - Grant Thornton LLP
(b) Report of Independent Certified Public Accountants - KPMG Peat Marwick LLP
(b) Reports on Form 8-K
During the quarter ended December 31, 1995, the Registrant did not file any reports on Form 8-K.
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.
HARLEYSVILLE NATIONAL CORPORATION
Date: March 14, 1996 By: /s/ Walter E. Daller, Jr. Walter E. Daller, Jr. President
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.
Signatures Title Date ---------- ----- -----
/s/ John W. Clemens Director March 14, 1996 John W. Clemens
/s/ Walter E. Daller, Jr. President, Chief March 14, 1996 Walter E. Daller, Jr. Executive Officer and Director (Princi- pal Executive Officer)
/s/ Martin E. Fossler Director March 14, 1996 Martin E. Fossler
/s/ Harold A. Herr Director March 14, 1996 Harold A. Herr
/s/ Vernon L. Hunsberger Treasurer (Princi- March 14, 1996 Vernon L. Hunsberger pal Financial and Accounting Officer)
/s/ Howard E. Kalis, III Director March 14, 1996 Howard E. Kalis, III
/s/ Bradford W. Mitchell Director March 14, 1996 Bradford W. Mitchell
/s/ Walter F. Vilsmeier Director March 14, 1996 Walter F. Vilsmeier
/s/ William M. Yocum Director March 14, 1996 William M. Yocum
EXHIBIT INDEX -------------
(13) 1995 Annual Report to Shareholders (this document is filed only to the extent of pages 8 through 37 which are incorporated by reference herein)
(21) Subsidiaries of Registrant
(23) Consent of Grant Thornton LLP Independent Certified Public Accountants
(99) Additional Exhibits
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