SEC Company Response from ARROW FINANCIAL CORP (AROW) (CIK 0000717538) (AROW) — Jul 11, 2006
ARROW FINANCIAL CORP (AROW) (CIK 0000717538)
Date: July 11, 2006 · CIK: 0000717538 · Accession: 0000717538-06-000035
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 000-12507
Referenced dates: June 14, 2006
Letter
United States Securities and Exchange Commission SEC Comment Letter dated June 14, 2006 for Arrow Financial Corporation Form 10-K for Fiscal Year Ended December 31, 2005 File No. 000-12507
Dear Mr. Cline:
Regarding your comments related to the presentation of acquisitions in our Consolidated Statement of Cash Flows:
·
We will move all acquisition activity to investing activities in future filings.
·
Since the deposits in the branch exceeded the purchase price and assets acquired, the acquisition of the branches resulted in Arrow receiving net cash of $47 million.
·
The 2004 $31 thousand from the CFG acquisition represents the cash that existed on the CFG balance sheet on the date of acquisition. This activity will also be shown under investing activities in future filings. The 2005 $91 thousand CFG transaction was a non-cash transaction. That, as well as the 2004 $1,980 thousand worth of shares issued in the CFG acquisition, will be disclosed as such in the “Supplemental Disclosures to Statements of Cash Flow Information” to the Consolidated Statement of Cash Flows in all future filings.
We acknowledge that:
·
Arrow is responsible for the adequacy and accuracy of the disclosure in our filings;
·
that staff comments or changes to disclosure in response to staff comments do not foreclose the Commission from taking any action with respect to the filing; and
·
Arrow may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.
Sincerely,
John J. Murphy
Show Raw Text
CORRESP
1
filename1.htm
June xx, 2006
June 27, 2006
John J. Murphy
Executive Vice President,
Treasurer and CFO
Arrow Financial Corporation
250 Glen Street
Glens Falls, NY 12801
Mr. Paul Cline
Senior Accountant
United States Securities and Exchange Commission
Mail Stop 4561
100 F Street, N.E.
Washington, DC 20549
Re:
SEC Comment Letter dated June 14, 2006 for
Arrow Financial Corporation
Form 10-K for Fiscal Year Ended December 31, 2005
File No. 000-12507
Dear Mr. Cline:
Regarding your comments related to the presentation of acquisitions in our Consolidated Statement of Cash Flows:
·
We will move all acquisition activity to investing activities in future filings.
·
Since the deposits in the branch exceeded the purchase price and assets acquired, the acquisition of the branches resulted in Arrow receiving net cash of $47 million.
·
The 2004 $31 thousand from the CFG acquisition represents the cash that existed on the CFG balance sheet on the date of acquisition. This activity will also be shown under investing activities in future filings. The 2005 $91 thousand CFG transaction was a non-cash transaction. That, as well as the 2004 $1,980 thousand worth of shares issued in the CFG acquisition, will be disclosed as such in the “Supplemental Disclosures to Statements of Cash Flow Information” to the Consolidated Statement of Cash Flows in all future filings.
We acknowledge that:
·
Arrow is responsible for the adequacy and accuracy of the disclosure in our filings;
·
that staff comments or changes to disclosure in response to staff comments do not foreclose the Commission from taking any action with respect to the filing; and
·
Arrow may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.
Sincerely,
John J. Murphy
Enclosures:
Pro Forma June 30, 2006 Form 10-Q Consolidated Statement of Cash Flows
Pro Forma December 31, 2006 Form 10-K Consolidated Statement of Cash Flows
Pro Forma Form 10-K:
ARROW FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
Years Ended December 31,
Operating Activities:
2006
2005
2004
Net Income
$ 18,639
$ 19,478
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
Provision for Loan Losses
1,030
1,020
Depreciation and Amortization
2,807
3,150
Compensation Expense for Allocated ESOP Shares
195
405
Gains on the Sale of Securities Available-for-Sale
(372)
(532)
Losses on the Sale of Securities Available-for-Sale
8
170
Loans Originated and Held-for-Sale
(8,581)
(17,675)
Proceeds from the Sale of Loans Held-for-Sale
8,632
18,078
Net Gains on the Sale of Loans
(122)
(336)
Net (Gains) Losses on the Sale of Premises and
Equipment and Other Real Estate Owned and Repossessed Assets
(32)
93
Contributions to Pension Plans
(1,074)
(345)
Deferred Income Tax Expense
190
597
Shares Issued Under the Directors’ Stock Plan
120
75
(Increase) Decrease in Interest Receivable
(532)
87
Increase (Decrease) in Interest Payable
267
(127)
Increase in Other Assets
(74)
(598)
Increase (Decrease) in Other Liabilities
2,671
(1,926)
Net Cash Provided By Operating Activities
23,772
21,614
Investing Activities:
Proceeds from the Sale of Securities Available-for-Sale
50,289
39,337
Proceeds from the Maturities and Calls of Securities Available-for-Sale
31,840
57,168
Purchases of Securities Available-for-Sale
(91,534)
(73,883)
Proceeds from the Maturities of Securities Held-to-Maturity
8,481
4,851
Purchases of Securities Held-to-Maturity
(18,688)
(7,402)
Net Increase in Loans
(114,525)
(21,944)
Proceeds from the Sales of Premises and Equipment and Other
Real Estate Owned and Repossessed Assets
939
891
Purchase of Premises and Equipment
(1,587)
(1,846)
Acquisition of Subsidiary
---
31
Net Increase from Branch Acquisitions
47,083
---
Net Cash Used In Investing Activities
(87,702)
(2,828)
Financing Activities:
Net Increase (Decrease) in Deposits
71,271
(14,336)
Net (Decrease) Increase in Short-Term Borrowings
(922)
3,040
Proceeds from Federal Home Loan Bank Advances
162,000
79,800
Repayments of Federal Home Loan Bank Advances
(155,000)
(79,800)
Repayment of Trust Preferred Securities
---
(5,000)
Proceeds from Issuance of Trust Preferred Securities
---
10,000
Purchase of Treasury Stock
(7,528)
(2,453)
Exercise of Stock Options and Shares Issued to Employees’ Stock Purchase Plan
1,558
1,591
Tax Benefit for Disposition of Stock Options
684
409
Common Stock Purchased by ESOP
178
411
Cash Dividends Paid
(9,558)
(9,000)
Net Cash Provided By (Used In) Financing Activities
62,683
(15,307)
Net (Decrease) Increase in Cash and Cash Equivalents
(1,247)
3,479
Cash and Cash Equivalents at Beginning of Year
36,805
33,326
Cash and Cash Equivalents at End of Year
$35,558
$36,805
Supplemental Disclosures to Statements of Cash Flow Information:
Cash Paid During the Year for:
Interest on Deposits and Borrowings
$23,847
$19,332
Income Taxes
6,447
10,228
Non-cash Investing Activity:
Transfer of Loans to Other Real Estate Owned and Repossessed Assets
893
928
Shares Issued for CFG Acquisition
91
---
See Notes to Consolidated Financial Statements
Pro Forma Form 10-Q
ARROW FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)(Unaudited)
Six Months
Ended June 30,
2006
2005
Operating Activities:
Net Income
$ 9,110
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
Provision for Loan Losses
408
Depreciation and Amortization
1,113
Compensation Expense for Allocated ESOP Shares
166
Net Gains on the Sale of Securities Available-for-Sale
(195)
Losses on the Sale of Securities Available-for-Sale
6
Loans Originated and Held-for-Sale
(1,381)
Proceeds from the Sale of Loans Held-for-Sale
2,312
Net Losses (Gains) on the Sale of Loans, Premises and Equipment,
Other Real Estate Owned and Repossessed Assets
9
Contributions to Pension Plans
---
(Increase) Decrease in Deferred Tax Assets
(181)
Shares Issued Under the Directors’ Stock Plan
60
(Increase) Decrease in Interest Receivable
(532)
Increase (Decrease) in Interest Payable
267
Increase in Other Assets
(268)
Increase (Decrease) in Other Liabilities
1,356
Net Cash Provided By Operating Activities
12,481
Investing Activities:
Proceeds from the Sale of Securities Available-for-Sale
28,178
Proceeds from the Maturities and Calls of Securities Available-for-Sale
19,361
Purchases of Securities Available-for-Sale
(46,455)
Proceeds from the Maturities of Securities Held-to-Maturity
6,916
Purchases of Securities Held-to-Maturity
(5,375)
Net Increase in Loans
(70,853)
Proceeds from the Sales of Premises and Equipment,
Other Real Estate Owned and Repossessed Assets
470
Purchases of Premises and Equipment
(226)
Net Increase from Branch Acquisitions
47,084
Net Cash Used In Investing Activities
(20,900)
Financing Activities:
Net Increase (Decrease) in Deposits
10,746
Net Increase in Short-Term Borrowings
6,943
Federal Home Loan Bank Advances
75,000
Federal Home Loan Bank Repayments
(80,000)
Tax Benefit from Exercise of Stock Options
397
Purchases of Treasury Stock
(4,503)
Treasury Stock Issued for Stock-Based Plans
1,063
Allocation of ESOP Shares
176
Cash Dividends Paid
(4,667)
Net Cash Provided By Financing Activities
5,155
Net Decrease in Cash and Cash Equivalents
(3,264)
Cash and Cash Equivalents at Beginning of Period
36,805
Cash and Cash Equivalents at End of Period
$33,541
Supplemental Cash Flow Information:
Interest Paid
$10,416
Income Taxes Paid
2,866
Transfer of Loans to Other Real Estate Owned and Repossessed Assets
403
Shares Issued for CFG Acquisition
---
See Notes to Unaudited Consolidated Interim Financial Statements.