SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended December 31, 2004 or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from to
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Commission file number 0-25033
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
The Banc Corporation 401(k) Plan
B. Name of issuer of the securities held pursuant to the plan and
the address of its principal executive office:
The Banc Corporation
17 North Twentieth Street
Birmingham, Alabama 35203
The Banc Corporation 401(k) Plan
Table of Contents
December 31, 2004 and 2003
PAGE
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AS OF
DECEMBER 31, 2004 AND FOR THE YEAR THEN ENDED 1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AS OF
DECEMBER 31, 2003 2
FINANCIAL STATEMENTS
Statements of Net Assets Available for Plan Benefits 3
Statement of Changes in Net Assets Available for Plan Benefits 4
Notes to Financial Statements 5 - 8
SUPPLEMENTARY INFORMATION
Schedule H, Line 4i -- Schedule of Assets (Held at End of Year) 9
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To Participants and Administrator of The Banc Corporation 401(k) Plan
We have audited the accompanying statement of net assets available for plan
benefits of the Banc Corporation 401(k) plan as of December 31, 2004, and the
related statement of changes in net assets available for plan benefits for the
year then ended. These financial statements are the responsibility of the plan's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of the Plan at
December 31, 2004, and the changes in its net assets available for plan benefits
for the year then ended, in conformity with accounting principles generally
accepted in the United States of America.
Our audit was performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplemental schedule of assets
(held at end of year) as of December 31, 2004, is presented for purpose of
additional analysis and is not a required part of the financial statements but
is supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. This supplemental schedule is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in our audit of the financial statements and, in our opinion,
is fairly stated in all material respects in relation to the financial
statements taken as a whole.
/s/ Carr, Riggs & Ingram LLC
Montgomery, Alabama
June 22, 2005
Report of Independent Registered Public Accounting Firm
Plan Administrator
The Banc Corporation 401(k) Plan
We have audited the accompanying statement of net assets available for benefits
of The Banc Corporation 401(k) Plan as of December 31, 2003. These financial
statements are the responsibility of the Plan's management. Our responsibility
is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan at
December 31, 2003, in conformity with U.S. generally accepted accounting
principles.
/s/ Ernst & Young LLP
Birmingham, Alabama
June 24, 2004
The Banc Corporation 401(k) Plan
Statements of Net Assets Available for Plan Benefits
December 31, 2004 2003
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ASSETS
Investments, at fair value $5,423,087 $5,577,004
Employer contributions receivable 287,787 277,950
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NET ASSETS AVAILABLE FOR PLAN BENEFITS $5,710,874 $5,854,954
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See accompanying notes to financial statements
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The Banc Corporation 401(k) Plan
Statement of Changes in Net Assets Available for Plan Benefits
Year ended December 31, 2004
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ADDITIONS
Company contributions $ 284,632
Participant contributions 842,818
Dividends 146,501
Interest 1,769
Transfer-in / rollovers 139,986
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1,415,706
DEDUCTIONS
Benefits paid to participants 1,695,781
Administrative expenses 1,200
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1,696,981
NET APPRECIATION IN FAIR VALUE OF INVESTMENTS 137,195
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NET (DECREASE) INCREASE (144,080)
NET ASSETS AVAILABLE FOR PLAN BENEFITS AT BEGINNING OF
YEAR 5,854,954
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NET ASSETS AVAILABLE FOR PLAN BENEFITS AT END OF YEAR $ 5,710,874
===========
See accompanying notes to financial statements
-4-
The Banc Corporation 401(k) Plan
Notes to Financial Statements
NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The financial statements of The Banc Corporation 401(k) Plan (the Plan) have
been prepared on the accrual basis of accounting.
INVESTMENT VALUATION AND INCOME RECOGNITION
The Banc Corporation's (the Company's) common stock is traded on the Nasdaq
Stock Market under the trading symbol "TBNC" and investments in the Company's
stock are valued using the closing price on the last business day of the plan
year. Cash and cash equivalents are stated at fair value, which is
approximated by cost. Investments in the mutual fund investments are stated
at fair value based on participation units owned by the Plan. Fair values of
the participation units owned by the Plan in the mutual fund investments are
based on quoted redemption values on the last business day of the Plan year
as determined by State Street Bank and Trust Company (the Custodian).
Participant loans are valued at their outstanding balance, which approximates
fair value. Purchases and sales of securities are recorded on a trade-date
basis. Interest income is recorded on the accrual basis. Dividends are
recorded on the ex-dividend date.
USE OF ESTIMATES
The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires management to make estimates that
affect the amounts reported in the financial statements and accompanying
notes. Actual results could differ from those estimates.
NOTE 2 -- DESCRIPTION OF PLAN
The following description of the Plan provides only general information.
Participants should refer to the Plan agreement for a more complete description
of the Plan's provisions.
GENERAL
The Plan is a defined contribution plan, which covers employees of the
Company who have attained age 21 and one year of service. The Plan is subject
to the provisions of the Employee Retirement Income Security Act of 1974, as
amended (ERISA).
CONTRIBUTIONS
Each year, participants may contribute up to 15% of pretax annual
compensation, as defined in the Plan subject to Internal Revenue limits.
Participants may also contribute amounts representing distributions from
other qualified defined benefit or defined contribution plans.
-5-
The Banc Corporation 401(k) Plan
Notes to Financial Statements
The Company may, at its discretion, match participants' contributions each
year up to a maximum of 6% of each participant's compensation. The Company
contributed $284,632 to the Plan in 2004.
VESTING
Participants are immediately vested in their contributions plus actual
earnings thereon. Vesting in the Company contribution portion of their
accounts plus actual earnings thereon is based on years of continuous
service. A participant is 100 percent vested after five years of credited
service.
PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's contributions
and allocations of (a) the Company's contributions and (b) Plan earnings, and
is charged with an allocation of administrative expenses. Allocations are
based on participant earnings or account balances, as defined. Forfeited
balances of terminated participants' nonvested accounts can be used to reduce
the Company's discretionary matching contributions in accordance with the
Plan agreement. During 2004, no forfeitures were used to reduce the Company's
discretionary matching contributions. The benefit to which a participant is
entitled is the benefit that can be provided from the participant's account.
PARTICIPANT LOANS
Participants may borrow from their fund accounts up to a maximum equal to the
lesser of $50,000 or 50% of their vested account balance. Loan terms range
from one to five years unless the loan is for the purchase of a primary
residence. In such case, the term of the loan shall be determined by the
Company based on maturity dates for similar loans in the local area. The
loans are secured by the balance in the participant's account and bear
interest at a rate commensurate with local prevailing rates as determined by
the Plan administrator. Principal and interest are paid ratably through
monthly payroll deductions.
PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate
the Plan subject to the provisions of ERISA. In the event of Plan
termination, participants will become 100 percent vested in their accounts.
-6-
The Banc Corporation 401(k) Plan
Notes to Financial Statements
PAYMENT OF BENEFITS
Upon termination of service, death, disability, or retirement, a participant
may receive a lump-sum amount equal to the vested value of his or her
account, or periodic equal installments for a period not to exceed the joint
and last survivor life expectancy of the participant and the participant's
beneficiary or an annuity.
ADMINISTRATIVE EXPENSES
The Company pays all administrative expenses, other than custodial fees, on
behalf of the Plan. Custodial fees are paid by the Plan.
NOTE 3 -- PARTIES-IN-INTEREST TRANSACTIONS
State Street Bank and Trust Company is the custodian for the plan's investments.
Certain plan investments are units of mutual fund investments managed by
Federated Retirement Services (Federated), the recordkeeper. One of the
investment vehicles in the Plan is The Banc Corporation common stock. The
Company pays for all legal, accounting, and other services on behalf of the
Plan.
NOTE 4 -- INCOME TAX STATUS
The Internal Revenue Service ("IRS") has determined and informed Federated by a
letter dated November 19, 2001, that the prototype 401(k) plan used by the Plan
is designed in accordance with the applicable requirements of the Internal
Revenue Code. The Plan Administrator and the Plan's Tax Counsel believe that the
Plan is currently designed and being operated in compliance with the applicable
requirements of the Internal Revenue Code. Therefore, no provision for income
taxes has been included in the Plan's financial statements.
NOTE 5 -- INVESTMENTS
During 2004, the Plan's investments (including investments bought, sold, as well
as held during the year) appreciated in fair value as determined by quoted
market prices as follows:
December 31, 2004
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The Banc Corporation common stock $125,011
Mutual fund investments 12,184
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$137,195
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The Banc Corporation 401(k) Plan
Notes to Financial Statements
The fair value of individual investments that represent 5% or more of the Plan's
net assets is as follows:
December 31, 2004 2003
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Federated Capital Preservation $1,433,105 $1,408,798
Federated Capital Appreciation 418,771 558,407
Federated Total Return Bond 1,342,849 1,817,185
The Banc Corporation common stock 1,028,978 925,361
NOTE 6 -- RISKS AND UNCERTAINTIES
The Plan invests in various investment securities. Investment securities are
exposed to various risks such as interest rate, market and credit risks. Due to
the level of risk associated with certain investment securities, it is at least
reasonably possible that changes in the values of investment securities will
occur in the near term and that such changes could materially affect
participants' account balances and the amounts reported in the statements of net
assets available for benefits.
NOTE 7 -- SUBSEQUENT EVENT
Effective January 1, 2005, the Plan became a safe harbor plan under the Internal
Revenue Code regulations. Under the new plan description, the employer matching
contribution is equal to 100% of the first 3% of employee contributions and 50%
of the next 2% of employee contributions. There is immediate vesting of the
employer matching contributions made after January 1, 2005.
-8-
The Banc Corporation 401(K) Plan
Schedule H, Line 4i-Schedule of Assets (Held at End of Year)
Plan Sponsor EIN:63-1201350
Plan Number 001
(A) (B) (C) (D) (E)
IDENTITY OF ISSUE, BORROWER,
LESSOR, OR SIMILAR PARTY DESCRIPTION OF INVESTMENT COST CURRENT VALUE
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* The Banc Corporation The Banc Corporation Common Stock Omitted cost $ 1,028,978
with respect to
participant
* Federated Federated Conservative Fund directed 16,773
transactions
under an
* Federated Federated Moderate Allocation Fund individual 30,763
account plan
* Federated Federated Capital Preservation 1,433,105
* Federated Federated GNMA Trust 23,650
* Federated Federated Total Return Bond 1,342,849
* American Century American Century Equity Income Advisor Class 49,276
* Baron Funds Baron Funds Growth Fund 229,409
* Constellation Funds Constellation Funds Small Cap Value 172,769
* Federated Federated Group Stock Trust 87,562
* Federated Federated Kaufmann Fund 114,463
* Federated Federated Capital Appreciation Fund 418,771
* Federated Federated Mid-Cap Index Fund 163,361
* Federated Federated Max-Cap Index Fund 80,000
* Janus Janus Advisor Capital Appreciation Fund 49,813
* Federated Federated International Equity Fund 61,378
* Federated Federated International Small Company Fund 49,048
* Participant Loans Interest rates ranging from 5% to 6% 71,109
* State Street Cash 10
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$ 5,423,087
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*Party-in-interest as defined by ERISA
See report of independent registered public accounting firm
-9-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Administrator of The Banc Corporation 401(k) Plan has duly caused this Annual
Report to be signed on its behalf by the undersigned hereunto duly authorized.
THE BANC CORPORATION 401(K) PLAN
By /s/ Fred Rogan
-------------------------------------
Fred Rogan
Administrator
Dated: June 29, 2005
EXHIBIT INDEX
Exhibit No. Exhibit
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23-1 Consent of Carr, Riggs & Ingram, LLC
23-2 Consent of Ernst & Young LLP