##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549
 FORM 10-QSB QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For quarterly period ending June 30, 2004
Commission File Number 000-26562 VALRICO BANCORP, INC. 
 Florida 
 65-0553757 
 1815 East State Road 60, Valrico, Florida 33594 
 (813) 689-1231 
 Securities registered under Section 12(b) of the Act: Name of each exchangeTitle of each Class
    
    on which registeredNone
    
    None
 Securities registered under Section 12(g) of the Act:
Common Stock, no par value 
 As of June 30, 2004, there were 325,100 shares of common stock outstanding. Transitional small business disclosure format (check one): Yes o No x




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TABLE OF CONTENTS  Part IIItem 6. Exhibits and Reports on Form 8-KItem 703. Purchases of Equity Securities by the Issuer and Affiliated Purchasers.SignaturesEX-31.1 Section 302 CEO CertificationEX-31.2 Section 302 CFO CertificationEX-32.1 Section 906 CEO CertificationEx-32.2 Section 906 CFO Certification    Table of Contents  Valrico Bancorp, Inc.
And Subsidiary
Consolidated Balance Sheets June 30,
    
    December 31,2004
    
    2003(in thousands)AssetsCash and Non-Interest Bearing Deposits
    
    
    7,521
    
    
    
    5,788Federal Funds Sold
    
    
    
    
    
    
    Securities Available for Sale
    
    
    23,745
    
    
    
    25,708Securities Held to Maturity
    
    
    871
    
    
    
    887Loans, Net
    
    
    90,171
    
    
    
    84,892Facilities, Net
    
    
    3,084
    
    
    
    3,089Other Real Estate
    
    
    303
    
    
    
    303Accrued Interest Receivable
    
    
    542
    
    
    
    558Other Assets
    
    
    2,519
    
    
    
    1,657Total Assets
    
    
    128,756
    
    
    
    122,882LiabilitiesDeposits
Demand Deposits
    
    
    24,779
    
    
    
    19,758NOW Accounts
    
    
    24,207
    
    
    
    22,570Money Market Accounts
    
    
    7,092
    
    
    
    8,645Savings Accounts
    
    
    20,442
    
    
    
    20,551Time Deposits, $100,000 and Over
    
    
    8,780
    
    
    
    9,736Other Time Deposits
    
    
    24,454
    
    
    
    25,580Total Deposits
    
    
    109,754
    
    
    
    106,840Securities Sold Under the Agreement to Repurchase
    
    
    501
    
    
    
    1,620Accounts Payable and Accrued Liabilites
    
    
    962
    
    
    
    772Advances Under Line Of Credit
    
    
    2,500
    
    
    
    695Notes Payable
    
    
    4,500
    
    
    
    2,887Total Liabilities
    
    
    118,217
    
    
    
    112,814Stockholders EquityCommon Stock, No Par Value, Authorized 1,000,000 Shares,
Issued and Outstanding 323,990 for March 2004 and 323,990
for December 2003
    
    
    325
    
    
    
    324Capital Surplus
    
    
    3,052
    
    
    
    3,004Retained Earnings
    
    
    7,236
    
    
    
    6,466Accumulated Other comprehensive Income
    
    
    (74
    )
    
    
    274Total Stockholders Equity
    
    
    10,539
    
    
    
    10,068Total Liabilities and Stockholders Equity
    
    
    128,756
    
    
    
    122,882




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Valrico Bancorp, Inc.
And Subsidiary
Consolidated Statements Of Income 6 Months EndedJune 30,2004
    
    2003(in thousands,except for per share data)Interest IncomeInterest and Fees on Loans
    
    
    3,074
    
    
    
    2,812Interest on Investment Securities
    
    
    512
    
    
    
    508Income on Federal Funds Sold
    
    
    2
    
    
    
    33Total Interest Income
    
    
    3,588
    
    
    
    3,353Interest ExpenseInterest on Deposits
    
    
    538
    
    
    
    761Interest on Term Debt
    
    
    106
    
    
    
    112Total Interest Expense
    
    
    644
    
    
    
    873Net Interest Income
    
    
    2,944
    
    
    
    2,480Provision for Loan Losses
    
    
    60
    
    
    
    60Net Interest Income After Provision for Loan Losses
    
    
    2,884
    
    
    
    2,420Other IncomeService Charges on Deposit Accounts
    
    
    432
    
    
    
    447Miscellaneous Income
    
    
    84
    
    
    
    73Total Other Income
    
    
    516
    
    
    
    520Other ExpensesSalaries and Employee Benefits
    
    
    1,270
    
    
    
    1,154Occupancy Expense
    
    
    181
    
    
    
    169Equipment Expense
    
    
    125
    
    
    
    125Stationary, Printing and Supplies
    
    
    49
    
    
    
    149Miscellaneous Expenses
    
    
    537
    
    
    
    350Total Other Expenses
    
    
    2,162
    
    
    
    1,947Income Before Taxes
    
    
    1,238
    
    
    
    993Income Taxes
    
    
    468
    
    
    
    360Net Income
    
    
    770
    
    
    
    633Other Comprehensive IncomeUnrealized Gains(Losses) on Securities
    
    
    (348
    )
    
    
    274Comprehensive Income
    
    
    422
    
    
    
    907Average Shares Outstanding:Basic
    
    
    324,570
    
    
    
    308,804Diluted
    
    
    384,480
    
    
    
    373,417Earnings Per Share:Basic
    
    
    2.37
    
    
    
    2.05Diluted
    
    
    2.00
    
    
    
    1.70




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Valrico Bancorp, Inc.
And Subsidiary
Consolidated Statements Of Income 3 Months EndedJune 30,2004
    
    2003(in thousands,except for per share data)Interest IncomeInterest and Fees on Loans
    
    
    1,552
    
    
    
    1,403Interest on Investment Securities
    
    
    250
    
    
    
    265Income on Federal Funds Sold
    
    
    2
    
    
    
    12Total Interest Income
    
    
    1,804
    
    
    
    1,680Interest ExpenseInterest on Deposits
    
    
    266
    
    
    
    366Interest on Term Debt
    
    
    52
    
    
    
    57Total Interest Expense
    
    
    318
    
    
    
    423Net Interest Income
    
    
    1,486
    
    
    
    1,257Provision for Loan Losses
    
    
    30
    
    
    
    30Net Interest Income After Provision for Loan Losses
    
    
    1,456
    
    
    
    1,227Other IncomeService Charges on Deposit Accounts
    
    
    222
    
    
    
    223Miscellaneous Income
    
    
    32
    
    
    
    44Total Other Income
    
    
    254
    
    
    
    267Other ExpensesSalaries and Employee Benefits
    
    
    642
    
    
    
    599Occupancy Expense
    
    
    89
    
    
    
    85Equipment Expense
    
    
    62
    
    
    
    62Stationary, Printing and Supplies
    
    
    23
    
    
    
    119Miscellaneous Expenses
    
    
    285
    
    
    
    151Total Other Expenses
    
    
    1,101
    
    
    
    1,016Income Before Taxes
    
    
    609
    
    
    
    478Income Taxes
    
    
    241
    
    
    
    169Net Income
    
    
    368
    
    
    
    309Other Comprehensive IncomeUnrealized Gains(Losses) on Securities
    
    
    (497
    )
    
    
    Comprehensive Income
    
    
    (129
    )
    
    
    309Average Shares Outstanding:Basic
    
    
    324,570
    
    
    
    306,018Diluted
    
    
    384,480
    
    
    
    365,928Earnings Per Share:Basic
    
    
    1.13
    
    
    
    1.01Diluted
    
    
    0.96
    
    
    
    0.84




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VALRICO BANCORP, INC.
AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY TotalCommon
    
    Capital
    
    Retained
    
    Comprehensive
    
    StockHoldersStock
    
    Surplus
    
    Earnings
    
    Income
    
    EquityBalance, December 31, 2003
    
    
    324
    
    
    
    3,004
    
    
    
    6,466
    
    
    
    274
    
    
    
    10,068Net Income
    
    
    
    
    
    
    
    
    
    
    770
    
    
    
    
    
    
    
    770Stock Sales
    
    
    1
    
    
    
    48
    
    
    
    
    
    
    
    
    
    
    
    49Net Change In Comprehensive Income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (348
    )
    
    
    (348
    )Balance, June 30, 2004
    
    
    325
    
    
    
    3,052
    
    
    
    7,236
    
    
    
    (74
    )
    
    
    10,539Balance, December 31, 2002
    
    
    309
    
    
    
    2,625
    
    
    
    5,070
    
    
    
    369
    
    
    
    8,373Net Income
    
    
    
    
    
    
    
    
    
    
    633
    
    
    
    
    
    
    
    633Stock Sales
    
    
    
    
    
    
    20
    
    
    
    
    
    
    
    
    
    
    
    20Net Change In Comprehensive Income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    150
    
    
    
    150Balance, June 30, 2003
    
    
    309
    
    
    
    2,645
    
    
    
    5,703
    
    
    
    519
    
    
    
    9,176




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Valrico Bancorp, Inc.
And Subsidiary
Consolidated Statements Of Cash Flows June 30,2004
    
    2003(in thousands)Cash Flows from Operating ActivitiesNet Income
    
    
    770
    
    
    
    633Adjustments to Reconcile net income to net
Cash provided by (used in) operating activities:Provision for Loan Losses
    
    
    60
    
    
    
    60Depreciation and amortization
    
    
    98
    
    
    
    92Net amortization (accretion) of investments
Security premiums and discounts
    
    
    56
    
    
    
    106(Increase) Decrease in assets:Accrued Interest Receivable
    
    
    16
    
    
    
    (105
    )Other Assets
    
    
    (862
    )
    
    
    (776
    )Increase (Decrease) in liabilities:Accounts payable and Accrued Liabilities
    
    
    190
    
    
    
    808Net Cash provided by (used in ) operating Activities
    
    
    328
    
    
    
    818Cash flows from investing activitiesSecurities available for sale:Purchase of investment securities
    
    
    (9,764
    )
    
    
    (9,591
    )Proceeds from maturities of investment securities
    
    
    11,323
    
    
    
    4,001Securities to be Held to Maturity:Proceeds from maturities of investment securities
    
    
    16
    
    
    
    290(Increase) Decrease in Federal Funds Sold
    
    
    
    
    
    
    (2,394
    )Net (Increase) Decrease in Loans
    
    
    (5,339
    )
    
    
    (5,943
    )Purchase of facilities
    
    
    (93
    )
    
    
    (49
    )Proceeds from the sale of Other Real Estate
    
    
    
    
    
    
    Net Cash provided by (used in) Investing Activities
    
    
    (3,857
    )
    
    
    (13,686
    )Cash flows from financing activities:Increase (Decrease) in deposits
    
    
    2,914
    
    
    
    10,513Net increase (Decrease) in securities sold under
agreement to Repurchase
    
    
    (1,119
    )
    
    
    685Net increase (Decrease)in notes payable
    
    
    3,418
    
    
    
    (39
    )Sale (redemption) of Common Stock
    
    
    49
    
    
    
    20Net Cash Provided by (used by) financing activities
    
    
    5,262
    
    
    
    11,179Net increase (decrease) in cash
    
    
    1,733
    
    
    
    (1,689
    )Cash, beginning of period
    
    
    5,788
    
    
    
    9,083Cash, ending of period
    
    
    7,521
    
    
    
    7,394




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Valrico Bancorp, Inc.
And Subsidiary
Consolidated Statements Of Cash Flows (Cont) June 30,SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
    
    2004
    
    2003Cash paid during the period for:Interest
    
    
    716
    
    
    
    935Income taxes
    
    
    560
    
    
    
    40




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Valrico Bancorp, Inc.
And Subsidiary Notes to
Consolidated Finacial Statements Basis Of Presentation The accompanying unaudited consolidated financial statements have been prepared
in accordance with accounting principles generally accepted in the United
States of America. In the opinion of management, all necessary adjustments
(consisting of normal recurring entries) have been made for a fair presentation
of the accompanying unaudited consolidated financial statements. These
financial statements rely, in part, on estimates. The results for the period
are not necessarily indicative of the results to be expected for the entire
year. Valrico Bancorp, Inc., a one-bank holding company, acquired 100% of the common
stock of Valrico State Bank as of May 31, 1995 in a transaction accounted for
similar to a pooling of interests. Therefore, the unaudited consolidated
financial statements include the accounts of Valrico Bancorp, Inc. (the
Company) and its wholly owned subsidiary, Valrico State Bank (the Bank).
Significant intercompany balances and transactions have been eliminated in
consolidation. Basic net income per share has been computed by dividing net income by the
average number of common shares outstanding of 324,570 as of June 30, 2004, and
308,804 as of June 30, 2003. Diluted net income per share has been computed by
dividing net income by the average number of common shares and common share
equalivent outstanding of 384,480 as of June 30, 2004 and 373,417 as of June
30, 2003.




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Managements Discussion and Analysis of Financial Condition and Results of Operations Results Of Operations The Companys primary asset is its subsidiary bank, which is in its fifteenth
year of operation. During the six months ended June 30, 2003, the Bank
experienced a growth in deposits with an increase of $2,914,000 or 2.7%.
Demand Accounts had the highest percentage of growth at 25.4%, or an increase
of $5,021,000 in the six months ended June 30, 2003. Loan growth increased $5,279,000 or 6.2% for the six months ended June 30,
2003. The allowance for credit losses at June 30, 2003 was at $1,280,000
compared to 1,206,000 at December 31, 2003. The Bank had $2,000 in
charge-offs and had recoveries in the amount of $16,000 during the six months
ended June 30, 2003, and has loan classified as troubled in the amount of $0 as
of June 30, 2003. A total of $60,000 was expensed for provision for loan
losses during the period. Management considers the allowance to be adequate at
this time. Nonaccrual loans amounted to $0 and $54,000 at June 30, 2004 and 2003,
respectively. Loans 90 days or more past due amounted to $131,000 and $0 at
June 30, 2004 and 2003, respectively. There were restructured loans in the
amount of $66,000 and $17,000 at June 30, 2004 and 2003, respectively. The
table on the following page sets forth a summary of loan loss experience:




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Managements Discussion and Analysis of Financial Condition and Results of Operations (Cont.) Analysis of the Allowance for Loan Losses June 30,2004
    
    2003(in thousands)Beginning Reserves
    
    
    1,206
    
    
    
    1,015Charge offs:Commercial
    
    
    
    
    
    
    1Commercial Real Estate
    
    
    
    
    
    
    Consumer
    
    
    2
    
    
    
    6Residential
    
    
    
    
    
    
    Total Charge Offs
    
    
    2
    
    
    
    7RecoveriesCommercial
    
    
    10
    
    
    
    41Commercial Real Estate
    
    
    Consumer
    
    
    6
    
    
    
    16Residential
    
    
    Total Recoveries
    
    
    16
    
    
    
    57Net Charge offs
    
    
    (14
    )
    
    
    (50
    )Provision for Loan Losses
    
    
    60
    
    
    
    60Ending Reserves
    
    
    1,280
    
    
    
    1,125
 Consolidated net income for the six months ending June 30, 2004 was $770,000 or
$2.37 and $2.00 per share, basic and diluted respectively, which compares to
$633,000 or $2.05 and $1.70 per share, basic and diluted respectively, for the
same period in 2003. This represents an increase over the comparable period of
$137,000. Salaries and benefits represent 58.7% of non-interest expenses for the six
months ended June 30, 2004, compared to 59.3% for the six months ended June 30,
2003. Salary expense for the six months ended June 30, 2003 increased 10.1%
over the same period for 2003. The Tier I capital ratio was 8.26% and Total Capital ratio was 9.34% at June
30, 2004. The tier I capital to total risk-weighted assets ratio was 10.54%
and total risk based capital ratio was 11.80% at June 30, 2004.




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Disclosure Of Evaluation Of Disclosure Controls And Procedures Controls and Procedures. The Company carried out an evaluation, under the supervision and with the
participation of the Companys management, including the Companys Chief
Executive Officer and Chief Financial Officer, of the effectiveness of the
design and operation of the Companys disclosure controls and procedures as of
June 30, 2004, pursuant to Exchange Act Rule 13a-15. Based upon that
evaluation, the Chief Executive Officer and Chief Financial Officer concluded
that the Companys disclosure controls and procedures were effective as of June
30, 2004, in timely alerting them to material information relating to the
Company (including its consolidated subsidiaries) required to be included in
the Companys periodic SEC filings. There was no change in the Companys internal control over financial reporting
that occurred during the Companys fiscal quarter ended June 30, 2004, that has
materially affected, or is reasonably likely to materially affect, the
Companys internal control over financial reporting.




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Part II 
 Item 6. Exhibits and Reports on Form 8-K All applicable exhibits required by item 601 of Regulation SB are furnished
herewith. No reports on Form 8-K were filed during the quarter ended September 30, 2003. 
 Item 703. Purchases of Equity Securities by the Issuer and Affiliated Purchasers.  (a)
    
    In the following tabular format, provide the information specified in
paragraph (b) of this Item with respect to any purchase made by or on
behalf of the issuer or any affiliated purchaser, as defined in §
240.10b-18(a)(3) of this chapter, of shares or other units of any class of
the issuers equity securities that is registered by the issuer pursuant
to section 12 of the Exchange Act. ISSUER PURCHASES OF EQUITY SECURITIES (d) Maximum Number(c) Total Number of
    
    (or ApproximateShares (or Units)
    
    Dollar Value) ofPurchased as Part
    
    Shares (or Units)(a) Total Number of
    
    (b)
    
    of Publicly
    
    that May Yet BeShares (or Units)
    
    Average Price Paid
    
    Announced Plans or
    
    Purchased Under thePeriod
    
    Purchased
    
    per Share (or Unit)
    
    Programs
    
    Plans or ProgramsJanuary 2004
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0February 2004
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0March 2004
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Total
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0




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Signatures In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on it behalf by the undersigned, thereunto duly
authorized. VALRICO BANCORP, INC.August 16th 2004
    
    \s\ Bob McleanBob McleanPresident and Chief Executive OfficerAugust 16th 2004
    
    \s\ Jerry L. BallJerry L. BallExecutive Vice President