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B. Balance Sheet and Capitalization
As of March 31, 1993 (the reporting date), Peoples had
reported total assets of $90.7 million, total liabilities of
$70.8 million, and stockholder's equity of $19.9 million. On the
valuation date, the capital structure of Peoples included no
debt, other than deposits and other short-term liabilities.
1. Assets
As of the reporting date, Peoples' assets consisted
primarily of net loans of $29.9 million and marketable securities
of $54.3 million. Marketable securities thus represented
approximately 60 percent of Peoples' assets, while net loans
represented approximately 33 percent.
The bulk of Peoples' investment portfolio consisted of 5-
year treasury bonds that had been purchased in the high interest
rate environment of the late 1980's and early 1990's. As of May
1993, a substantial number of those bonds were scheduled to
mature in 12 to 24 months, subjecting Peoples to interest rate
risk in the lower interest rate environment prevailing at that
time.
2. Stock
a. Control
On the valuation date, there were 3,000 shares of Peoples
common stock outstanding. The two largest shareholders were
decedent (1,499 shares) and Mildred Hendrickson (610 shares).
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Last modified: May 25, 2011