**UNITED STATES SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C.  20549**

 

**Form 10-QSB**

** **

| ý |   | **QUARTERLY  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR  THE QUARTERLY PERIOD ENDED March 31, 2004**                                                                                                                                                                             |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                              |
| o      |   | **TRANSITION  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT FOR THE  TRANSITION PERIOD FROM                   TO                  ** |

 

**Commission FileNumber 0-28894**

 

**Access Anytime Bancorp, Inc.**

(Name of small business issuer in its charter)

 

| **DELAWARE**                                                                                              |   | **85-0444597**                       |
|-----------------------------------------------------------------------------------------------------------|--------|--------------------------------------|
| (State or other jurisdiction of  incorporation or organization)                                           |   | (I.R.S. Employer Identification No.) |
|                                                                                                      |   |                                 |
| **5210 Eubank, NE, Albuquerque, New Mexico 87111**                                                        |
| (Address of principal executive  offices)         (Zip Code) |
|                                                                                                      |
| Issuer’s telephone number, including area code:  **(505) 299-0900**                             |

 

SECURITIESREGISTERED UNDER SECTION 12(b) OF THE EXCHANGE ACT:** None**

 

SECURITIESREGISTERED UNDER SECTION 12(g) OF THE EXCHANGE ACT:

 

**COMMONSTOCK $.01 PAR VALUE**(Title of class)

 

Check whether the issuer (1) filed allreports required to be filed by Section 13 or 15(d) of the Exchange Act duringthe past 12 months (or for such shorter period that the registrant was requiredto file such reports), and (2) has been subject to such filing requirements forthe past 90 days.

 

| Yes ý |   | No o |
|------------|--------|------|

 

1,341,767 Shares of Capital Stock $.01 par value

 

Outstanding as of April 30, 2004

 

 

TransitionalSmall Business Disclosure Format (check one): Yes o    No ý

 

 

----

 

**TABLE OF CONTENTS**

 
| **PART I – FINANCIAL  INFORMATION**                                                             |                                                           |
|------------------------------------------------------------------------------------------------------|----------------------------------------------------------------|
|                                                                                                 |                                                           |   |
| Item 1 – Financial Statements                                                                   |                                                           |
|                                                                                                 |                                                           |   |
|                                                                                                 | Consolidated Statements of Financial  Condition                |   |
|                                                                                                 |                                                           |   |
|                                                                                                 | (Unaudited as of March 31, 2004)                               |   |
|                                                                                                 |                                                           |   |
|                                                                                                 | Unaudited Consolidated Statements of  Operations               |   |
|                                                                                                 |                                                           |   |
|                                                                                                 | Unaudited Consolidated Statement of  Stockholders’ Equity |   |
|                                                                                                 |                                                           |   |
|                                                                                                 | Unaudited Consolidated Statements of Cash  Flows               |   |
|                                                                                                 |                                                           |   |
|                                                                                                 | Notes to Consolidated Financial Statements  (Unaudited)        |   |
|                                                                                                 |                                                           |   |
| Item 2 – Management’s Discussion and  Analysis or Plan of Operation                        |                                                           |
|                                                                                                 |                                                           |   |
| Item 3 – Controls and Procedures                                                                |                                                           |
|                                                                                                 |                                                           |   |
| **PART II – OTHER INFORMATION**                                                                 |                                                           |
|                                                                                                 |                                                           |   |
| Item 1  – Legal Proceedings                                                                |                                                           |
|                                                                                                 |                                                           |   |
| Item  2  – Changes in Securities and Small  Business Issuer Purchases of Equity Securities |                                                           |
|                                                                                                 |                                                           |   |
| Item 3 –  Defaults Upon Senior Securities                                                       |                                                           |
|                                                                                                 |                                                           |   |
| Item 4 –  Submission of Matters to a Vote of Security Holders                                   |                                                           |
|                                                                                                 |                                                           |   |
| Item 5 – Other Information                                                                      |                                                           |
|                                                                                                 |                                                           |   |
| Item 6 –  Exhibits and Reports on Form 8-K                                                      |                                                           |
|                                                                                                 |                                                           |   |
| **SIGNATURES**                                                                                       |                                                           |

 

2

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**PART I – FINANCIAL INFORMATION**

 

# **Item 1 – FinancialStatements**

# ** **

The following unauditedconsolidated financial statements include all adjustments, which in the opinionof management, are necessary in order to make such financial statements notmisleading.

 

# **ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY**

# **ConsolidatedStatements of Financial Condition**

 
|                                                                                                                                                                                |   | **Unaudited  March 31,  2004** |        | **December  31,  2003** |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------|-------------|-------------------------|--------|
| ASSETS                                                                                                                                                                              |   |                           |        |                    |   |
|                                                                                                                                                                                |   |                           |        |                    |   |
| Cash and cash equivalents                                                                                                                                                           |   | $                              | 7,113,000   |                    | $      | 11,611,364 |   |
| Certificates of deposit                                                                                                                                                             |   | 4,373,000                      |        | 4,480,000               |   |
| Securities available-for-sale (amortized  cost of $5,430,659 and $5,718,248)                                                                                                        |   | 5,532,665                      |        | 5,814,701               |   |
| Securities held-to-maturity (aggregate fair  value of $16,038,362  and $16,829,145)                                                                                            |   | 15,815,443                     |        | 16,761,939              |   |
| Loans held-for-sale (aggregate fair value  of $3,383,314 and $1,834,564)                                                                                                            |   | 3,318,279                      |        | 1,797,290               |   |
| Loans receivable, net                                                                                                                                                               |   | 160,052,348                    |        | 156,237,317             |   |
| Interest receivable, loans                                                                                                                                                          |   | 693,522                        |        | 732,964                 |   |
| Interest receivable, securities                                                                                                                                                     |   | 227,595                        |        | 125,994                 |   |
| Real estate owned                                                                                                                                                                   |   | 410,114                        |        | 565,159                 |   |
| Federal Home Loan Bank stock                                                                                                                                                        |   | 1,171,500                      |        | 1,167,200               |   |
| Premises and equipment, net                                                                                                                                                         |   | 3,522,429                      |        | 3,556,833               |   |
| Unidentifiable intangible asset, net of  accumulated amortization of $642,519 and $606,104                                                                                          |   | 1,541,569                      |        | 1,577,984               |   |
| Deferred tax asset                                                                                                                                                                  |   | 303,552                        |        | 388,573                 |   |
| Other assets                                                                                                                                                                        |   | 599,822                        |        | 609,834                 |   |
|                                                                                                                                                                                |   |                           |        |                    |   |
| Total assets                                                                                                                                                                        |   | $                              | 204,674,838 |                    | $      | 205,427,152 |   |
|                                                                                                                                                                                |   |                           |        |                    |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                                                           |   |                           |        |                    |   |
|                                                                                                                                                                                |   |                           |        |                    |   |
| Liabilities:                                                                                                                                                                        |   |                           |        |                    |   |
| Deposits                                                                                                                                                                            |   | $                              | 164,645,385 |                    | $      | 162,846,107 |   |
| Federal Home Loan Bank advances                                                                                                                                                     |   | 14,538,935                     |        | 17,066,654              |   |
| Accrued interest and other liabilities                                                                                                                                              |   | 1,520,426                      |        | 1,794,005               |   |
| Advanced payments by borrowers for taxes  and insurance                                                                                                                             |   | 376,931                        |        | 354,670                 |   |
| Trust Preferred Securities – Notes Payable                                                                                                                                     |   | 8,000,000                      |        | 8,000,000               |   |
|                                                                                                                                                                                |   |                           |        |                    |   |
| Total liabilities                                                                                                                                                                   |   | 189,081,677                    |        | 190,061,436             |   |
|                                                                                                                                                                                |   |                           |        |                    |   |
| Commitments and contingencies                                                                                                                                                       |   |                           |        |                    |   |
|                                                                                                                                                                                |   |                           |        |                    |   |
| Stockholders’ equity:                                                                                                                                                          |   |                           |        |                    |   |
| Preferred stock, $.01 par value; 4,000,000  shares authorized; none issued                                                                                                          |   | —                         |        | —                  |   |
| Common stock, $.01 par value; 6,000,000  shares authorized; 1,511,099 and 1,510,744 shares issued;  1,222,305 and 1,221,070 shares outstanding  in 2004 and 2003, respectively |   | 15,111                         |        | 15,107                  |   |
| Capital in excess of par value                                                                                                                                                      |   | 11,741,667                     |        | 11,643,276              |   |
| Retained earnings                                                                                                                                                                   |   | 6,012,165                      |        | 5,831,295               |   |
| Accumulated other comprehensive income, net  of tax expense of $40,803 and $38,581                                                                                                  |   | 61,204                         |        | 57,872                  |   |
|                                                                                                                                                                                |   | 17,830,147                     |        | 17,547,550              |   |
| Unallocated Employee Stock Ownership Plan shares;  120,000 and 128,000  shares  outstanding                                                                                    |   | (645,000                       | )           | (690,000                | )      |
| Treasury stock, at cost; 168,794 and  161,674 shares                                                                                                                                |   | (1,591,986                     | )           | (1,491,834              | )      |
| Total stockholders’ equity                                                                                                                                                     |   | 15,593,161                     |        | 15,365,716              |   |
|                                                                                                                                                                                |   |                           |        |                    |   |
| Total liabilities and stockholders’ equity                                                                                                                                     |   | $                              | 204,674,838 |                    | $      | 205,427,152 |   |

 

The accompanying notes are an integral part of these unauditedconsolidated financial statements.

 

3

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# **ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY**

# **UnauditedConsolidated Statements of Operations**

 
|                                                  |   | **Three  Month Periods Ended  March 31,** |      |
|-------------------------------------------------------|--------|-------------------------------------------|-----------|
|                                                  |   | **2004**                                  |      | **2003** |   |
|                                                  |   |                                      |      |   |   |
| Interest income:                                      |   |                                      |      |   |   |
| Loans receivable                                      |   | $                                         | 2,593,157 |   | $ | 2,702,157 |   |
| Equity securities                                     |   | 127,765                                   |      | 39,277 |   |
| Mortgage-backed securities                            |   | 69,461                                    |      | 75,910 |   |
| Other interest income                                 |   | 45,269                                    |      | 67,393 |   |
|                                                  |   |                                      |      |   |   |
| Total interest income                                 |   | 2,835,652                                 |      | 2,884,737 |   |
|                                                  |   |                                      |      |   |   |
| Interest expense:                                     |   |                                      |      |   |   |
| Deposits                                              |   | 748,926                                   |      | 866,014 |   |
| Federal Home Loan Bank advances                       |   | 101,761                                   |      | 92,736 |   |
| Other borrowings                                      |   | 163,400                                   |      | 159,729 |   |
|                                                  |   |                                      |      |   |   |
| Total interest expense                                |   | 1,014,087                                 |      | 1,118,479 |   |
|                                                  |   |                                      |      |   |   |
| Net interest income before provision for  loan losses |   | 1,821,565                                 |      | 1,766,258 |   |
| Provision for loan losses                             |   | 213,000                                   |      | 142,000 |   |
|                                                  |   |                                      |      |   |   |
| Net interest income after provision for  loan losses  |   | 1,608,565                                 |      | 1,624,258 |   |
|                                                  |   |                                      |      |   |   |
| Noninterest income:                                   |   |                                      |      |   |   |
| Loan servicing and other fees                         |   | 128,595                                   |      | 142,733 |   |
| Gains on sales of mortgage loans  held-for-sale       |   | 224,614                                   |      | 398,138 |   |
| Other income                                          |   | 278,485                                   |      | 245,420 |   |
|                                                  |   |                                      |      |   |   |
| Total noninterest income                              |   | 631,694                                   |      | 786,291 |   |
|                                                  |   |                                      |      |   |   |
| Noninterest expense:                                  |   |                                      |      |   |   |
| Salaries and employee benefits                        |   | 960,695                                   |      | 1,053,256 |   |
| Occupancy expense                                     |   | 227,980                                   |      | 229,113 |   |
| Deposit insurance premium                             |   | 20,082                                    |      | 19,976 |   |
| Advertising                                           |   | 27,330                                    |      | 24,306 |   |
| Professional fees                                     |   | 144,374                                   |      | 82,764 |   |
| Other expense                                         |   | 483,994                                   |      | 529,066 |   |
|                                                  |   |                                      |      |   |   |
| Total noninterest expense                             |   | 1,864,455                                 |      | 1,938,481 |   |
|                                                  |   |                                      |      |   |   |
| Income before income taxes                            |   | 375,804                                   |      | 472,068 |   |
|                                                  |   |                                      |      |   |   |
| Income tax expense                                    |   | 194,934                                   |      | 204,847 |   |
|                                                  |   |                                      |      |   |   |
| Net income                                            |   | $                                         | 180,870   |   | $ | 267,221 |   |
|                                                  |   |                                      |      |   |   |
| Earnings per common share-basic                       |   | $                                         | 0.14      |   | $ | 0.21 |   |
|                                                  |   |                                      |      |   |   |
| Earnings per common share-assuming dilution           |   | $                                         | 0.13      |   | $ | 0.19 |   |

 

The accompanying notes are an integral part of these unauditedconsolidated financial statements.

 

4

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# **ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY**

### **UnauditedConsolidated Statement of Stockholders’ Equity**

 
|                                                                                     |   |                      |    |                  |   |       |   |                                  |                   |       |    | **Accumulated  Other  Comprehensive  Income,  Net** |      |                  |   |       |   |      |     |     |    |
|------------------------------------------------------------------------------------------|--------|---------------------------|---------|-----------------------|--------|------------|--------|---------------------------------------|------------------------|------------|---------|-----------------------------------------------------|-----------|-----------------------|--------|------------|--------|-----------|----------|----------|---------|
|                                                                                     |   |                      |    |                  |   |       |   | **Capital  in Excess  of Par  Value** |                   |       |    |                                                |      |                  |   |       |   |      |     |     |
|                                                                                     |   |                      |    |                  |   |       |   |                                  |                   |       |    |                                                |      |                  |   |       |   |      |     |
|                                                                                     |   |                      |    | **Common  Stock**     |   |       |   |                                  |                   |       |    | **Treasury  Stock**                                 |      |                  |   |
|                                                                                     |   | **Comprehensive  Income** |    | **Number  of shares** |   | **Amount** |   |                                  | **Retained  Earnings** |       |    | **Unallocated  ESOP Shares**                        |      | **Number  Of Shares** |   | **Amount** |   | **Total** |     |
| Balance  at December 31, 2003                                                            |   |                      |    | 1,510,744             |   | $          | 15,107 |                                  | $                      | 11,643,276 |    | $                                                   | 5,831,295 |                  | $      | 57,872     |   | $         | (690,000 | )        | 161,674 |   | $ | (1,491,834 | ) | $ | 15,365,716 |   |
|                                                                                     |   |                      |    |                  |   |       |   |                                  |                   |       |    |                                                |      |                  |   |       |   |      |     |     |    |
| Net income                                                                               |   | $                         | 180,870 |                  | — |       | — |                                  | —                 |       | 180,870 |                                                | —    |                  | — |       | — |      | —   |     | 180,870 |   |
|                                                                                     |   |                      |    |                  |   |       |   |                                  |                   |       |    |                                                |      |                  |   |       |   |      |     |     |    |
| Net change in unrealized appreciation  on available-for-sale securities, net of tax |   | 3,332                     |    | —                |   | —     |   | —                                |                   | —     |    | 3,332                                               |      | —                |   | —     |   | —    |     | 3,332    |    |
|                                                                                     |   |                      |    |                  |   |       |   |                                  |                   |       |    |                                                |      |                  |   |       |   |      |     |     |    |
| Total comprehensive income                                                               |   | $                         | 184,202 |                  |   |       |   |                                  |                   |       |    |                                                |      |                  |   |       |   |      |     |     |    |   |
|                                                                                     |   |                      |    |                  |   |       |   |                                  |                   |       |    |                                                |      |                  |   |       |   |      |     | 1,997    |    |
| Common shares issued                                                                     |   |                      |    | 355                   |   | 4          |   | 1,993                                 |                   |       |    |                                                |      |                  |   |       |   |      |     |     |    |
|                                                                                     |   |                      |    |                  |   |       |   |                                  |                   |       |    |                                                |      |                  |   |       |   |      |     |     |    |
| Common stock rights awarded in lieu of directors’ cash compensation                 |   |                      |    | —                |   | —     |   | 31,750                                |                   | —     |    | —                                              |      | —                |   | —     |   | —    |     | 31,750   |    |
|                                                                                     |   |                      |    |                  |   |       |   |                                  |                   |       |    |                                                |      |                  |   |       |   |      |     |     |    |
| Purchases  of  treasury stock                                                       |   |                      |    | —                |   | —     |   | —                                |                   | —     |    | —                                              |      | —                |   | 7,120      |   | (100,152  | )        | (100,152 | )       |
|                                                                                     |   |                      |    |                  |   |       |   |                                  |                   |       |    |                                                |      |                  |   |       |   |      |     |     |    |
| ESOP shares allocated                                                                    |   |                      |    | —                |   | —     |   | 64,648                                |                   | —     |    | —                                              |      | 45,000                |   | —     |   | —    |     | 109,648  |    |
|                                                                                     |   |                      |    |                  |   |       |   |                                  |                   |       |    |                                                |      |                  |   |       |   |      |     |     |    |
| Balance  at March 31, 2004                                                               |   |                      |    | 1,511,099             |   | $          | 15,111 |                                  | $                      | 11,741,667 |    | $                                                   | 6,012,165 |                  | $      | 61,204     |   | $         | (645,000 | )        | 168,794 |   | $ | (1,591,986 | ) | $ | 15,593,161 |   |
|                                                                                          |        |                           |         |                       |        |            |        |                                       |                        |            |         |                                                     |           |                       |        |            |        |           |          |          |         |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 
|                                                                                           |   | **Three  Months Ended** |   | **Year Ended**         |   |
|------------------------------------------------------------------------------------------------|--------|-------------------------|--------|------------------------|--------|
|                                                                                           |   | **March 31,  2004**     |   | **December  31, 2003** |   |
|                                                                                           |   |                    |   |                   |   |
| Disclosure of reclassification amounts:                                                        |   |                    |   |                   |   |
| Unrealized holding gains (losses) arising during period                                        |   | $                       | 3,332  |                   | $      | (21,578 | ) |
| Reclassification adjustment for losses included in net income                                  |   | —                  |   | (10,747                | )      |
| Net unrealized appreciation (depreciation) on available-for-sale  securities,  net of tax |   | $                       | 3,332  |                   | $      | (32,325 | ) |

 

The accompanying notes are an integral part of these unauditedconsolidated financial statements.

 

5

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**ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY**

# **UnauditedConsolidated Statements of Cash Flows**

 
|                                                                                |   | **Three  Month Periods Ended  March 31,** |      |
|-------------------------------------------------------------------------------------|--------|-------------------------------------------|-----------|
|                                                                                |   | **2004**                                  |      | **2003** |   |
| Cash flows from operating activities:                                               |   |                                      |      |   |   |
| Net income                                                                          |   | $                                         | 180,870   |   | $ | 267,221 |   |
| Adjustments to reconcile net income to cash  from operating activities:             |   |                                      |      |   |   |
| Depreciation                                                                        |   | 95,787                                    |      | 114,275 |   |
| Deferred income taxes                                                               |   | 85,021                                    |      | (23,711 | ) |
| Provision for loan losses                                                           |   | 213,000                                   |      | 142,000 |   |
| Amortization of premiums on investment  securities                                  |   | 7,633                                     |      | 10,181 |   |
| Amortization of loan premiums, discounts  and deferred fees, net                    |   | 70,123                                    |      | 70,472 |   |
| Amortization of unidentifiable intangible  asset                                    |   | 36,415                                    |      | 36,415 |   |
| Non-cash ESOP contribution                                                          |   | 109,648                                   |      | 75,999 |   |
| Gains on sales of mortgage loans  held-for-sale                                     |   | (224,614                                  | )         | (398,138 | ) |
| Proceeds from sales of mortgage loans  held-for-sale                                |   | 12,439,100                                |      | 20,804,525 |   |
| Originations of mortgage loans  held-for-sale                                       |   | (13,735,475                               | )         | (26,069,502 | ) |
| Common stock rights awarded in lieu of  directors compensation                      |   | 31,750                                    |      | 16,000 |   |
| (Gain) loss on sale of foreclosed real  estate                                      |   | (39,099                                   | )         | 5,883 |   |
| Gain on disposition of assets                                                       |   | —                                    |      | (1,877 | ) |
| Net (increase) decrease in accrued interest  receivable and other assets            |   | (53,115                                   | )         | 19,789 |   |
| Decrease in accrued interest and other  liabilities                                 |   | (481,733                                  | )         | (116,505 | ) |
|                                                                                |   |                                      |      |   |   |
| Net cash flows from operating activities                                            |   | (1,264,689                                | )         | (5,046,973 | ) |
|                                                                                |   |                                      |      |   |   |
| Cash flows from investing activities:                                               |   |                                      |      |   |   |
| Proceeds from maturities and principal  repayments of available-for-sale securities |   | 278,211                                   |      | 643,248 |   |
| Purchases of held-to-maturity securities                                            |   | (207,472                                  | )         | — |   |
| Proceeds from maturities and principal  repayments of held-to-maturity securities   |   | 1,150,160                                 |      | 242,403 |   |
| Net decrease in certificates of deposit                                             |   | 107,000                                   |      | 100,000 |   |
| Net increase in loans                                                               |   | (4,098,154                                | )         | (205,356 | ) |
| Proceeds from sales of foreclosed real  estate                                      |   | 402,298                                   |      | 179,500 |   |
| Purchases of premises and equipment                                                 |   | (61,383                                   | )         | (30,837 | ) |
|                                                                                |   |                                      |      |   |   |
| Net cash flows from investing activities                                            |   | (2,429,340                                | )         | 928,958 |   |
|                                                                                |   |                                      |      |   |   |
| Cash flows from financing activities:                                               |   |                                      |      |   |   |
| Net increase (decrease) in deposits                                                 |   | 1,799,278                                 |      | (911,612 | ) |
| Net (decrease) increase in Federal Home  Loan Bank advances                         |   | (2,527,719                                | )         | 6,203,654 |   |
| Net increase in advance payments by  borrowers for taxes and insurance              |   | 22,261                                    |      | 65,312 |   |
| Purchase of treasury stock                                                          |   | (100,152                                  | )         | (1,022,216 | ) |
| Proceeds from issuance of common stock                                              |   | 1,997                                     |      | 2,998 |   |
|                                                                                |   |                                      |      |   |   |
| Net cash flows from financing activities                                            |   | (804,335                                  | )         | 4,338,136 |   |
|                                                                                |   |                                      |      |   |   |
| (Decrease) increase in cash and cash  equivalents                                   |   | (4,498,364                                | )         | 220,121 |   |
| Cash and cash equivalents at beginning of  period                                   |   | 11,611,364                                |      | 12,342,444 |   |
|                                                                                |   |                                      |      |   |   |
| Cash and cash equivalents at end of quarter  ended March 31                         |   | 7,113,000                                 |      | 12,562,565 |   |
|                                                                                |   |                                      |      |   |   |
| Supplemental disclosures of cash flow  information:                                 |   |                                      |      |   |   |
| Cash paid during the period for:                                                    |   |                                      |      |   |   |
| Interest                                                                            |   | $                                         | 1,117,201 |   | $ | 1,221,198 |   |
| Income taxes                                                                        |   | 150                                       |      | 150 |   |
| Supplemental disclosure of non-cash  investing and financing activities:            |   |                                      |      |   |   |
| Real estate acquired in settlement of loans                                         |   | 176,633                                   |      | 124,434 |   |

 

The accompanying notes are an integral part of these unauditedconsolidated financial statements.

 

6

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#### ** **

#### **ACCESS ANYTIME BANCORP, INC. AND SUBSIDIARY**

**NOTESTO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)**

#### ** **

#### **NOTE 1**                                                    Basis of Consolidation and Presentation

#### ** **

Access Anytime Bancorp, Inc.(the “Company”) is a thrift holding company for its wholly owned subsidiaryFirstBank (the “Bank”) and the Bank’s wholly owned subsidiary, First EquityDevelopment Corporation (“FEDCO”).  Theconsolidated financial statements include the accounts and transactions of theCompany, Bank and FEDCO.  Allsignificant intercompany accounts and transactions have been eliminated inconsolidation.

 

The unaudited interim financialstatements have been prepared by management of the Company, without audit.  Certain information and footnote disclosuresnormally included in audited consolidated financial statements prepared inaccordance with accounting principles generally accepted in the United Statesof America have been omitted pursuant to such rules and regulations, althoughmanagement believes that the disclosures included herein are adequate to makethe information presented not misleading. In the opinion of management, all adjustments (consisting of only normalrecurring accruals) considered necessary for a fair presentation of the informationhave been included.  The December 31,2003 consolidated statement of financial condition, as presented herein, wasderived from audited financial statements, but does not include all disclosuresrequired by accounting principles generally accepted in the United States ofAmerica and should be read in conjunction with the audited consolidatedfinancial statements of the Company for the year ended December 31, 2003included in the Company’s Annual Report on 10-KSB.

 

#### **NOTE 2**                                                    Summary of Significant AccountingPolicies

#### ** **

***Impactof New Accounting Standards*** – In December 2002,the FASB issued Statement No. 148 (“Statement 148”), *Accounting for Stock-BasedCompensation-Transition and Disclosure-an amendment of FASB Statement No. 123.*  This statement amends Statement 123 toprovide alternative methods of transition to a voluntary change to the fairvalue based method of accounting for stock-based employee compensation.  In addition, Statement 148 amends thedisclosure requirements to require prominent disclosures in both annual andinterim financial statements about the method of accounting for stock-basedemployee compensation and the effect of the method used on reported results.

 

Statement 148 allows for thefair value based method under Statement 123, *Accounting for Stock Based Compensation*,or the intrinsic value based method under APB Opinion No. 25 (“Opinion 25”), *Accountingfor Stock Issued to Employees*. Under the fair value based method of accounting, compensation cost ismeasured at the grant date based on the value of the award and is recognizedover the service period, which is generally the vesting period.  Under the intrinsic value method ofaccounting, compensation cost is the excess, if any, of the quoted market priceof the stock at grant date or other measurement date over the amount anemployee must pay to acquire the stock. The Company has elected to continue to use the intrinsic value method ofaccounting under Opinion 25, and will disclose the proforma effects of the fairvalue based method for the periods presented in its consolidated financialstatements.

 

7

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Had compensation cost for allgrants of stock options and the director retainer plan shares during 2004 and2003 been determined based on the fair value at the date of grant, reported netincome and earnings per share would have been adjusted to the pro-forma amountsshown below:

 
|                                                                                                                                          |   | **Quarter  Ended  March 31,** |    |
|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|---------|
|                                                                                                                                          |   | **2004**                      |    | **2003** |   |
|                                                                                                                                          |   |                          |    |   |   |
| Net income, as reported                                                                                                                       |   | $                             | 180,870 |   | $ | 267,221 |   |
| Deduct:   Stock-based employee compensation expense included in reported net  income, net of related tax effects                         |   | (85,012                       | )       | (450 | ) |
| Deduct: Total stock-based employee  compensation expense determined under fair value based method for all awards,  net of related tax effects |   | (5,971                        | )       | (5,340 | ) |
| Pro forma net income                                                                                                                          |   | $                             | 87,887  |   | $ | 261,431 |   |
|                                                                                                                                          |   |                          |    |   |   |
| Earnings per share-basic                                                                                                                      |   |                          |    |   |   |
| As reported                                                                                                                                   |   | $                             | 0.14    |   | $ | 0.21 |   |
| Pro-forma                                                                                                                                     |   | 0.07                          |    | 0.20 |   |
|                                                                                                                                          |   |                          |    |   |   |
| Earnings per share-assuming dilution                                                                                                          |   |                          |    |   |   |
| As reported                                                                                                                                   |   | $                             | 0.13    |   | $ | 0.19 |   |
| Pro-forma                                                                                                                                     |   | 0.06                          |    | 0.19 |   |

 

In January 2003, the FASBissued Interpretation No. 46 (“Interpretation 46”), *Consolidation of Variable InterestEntities, an interpretation of ARB No. 51*.  This interpretation of Accounting Research Bulletin No. 51, *ConsolidatedFinancial Statements*, addresses consolidation by businessenterprises of variable interest entities (selected entities with relatedcontractual, ownership, voting or other monetary interests, including certainspecial purpose entities), and requires certain additional disclosure withrespect to these entities.  Theprovisions of Interpretation 46 are immediately applicable to variable interestentities created after January 31, 2003. In December 2003, the FASB issued a revision to Interpretation 46,commonly referred to as Interpretation No. 46R (“Interpretation 46R”).  The objective of Interpretation 46R was toprovide additional clarification to Interpretation 46 and require publicentities to identify those entities that are considered special purposeentities (SPEs) in which they have variable interests and to apply theprovisions of either Interpretation 46 of 46R at December 31, 2003.  The full provisions of Interpretation 46Rwill be required by the Company for the fiscal year end December 31, 2004.

 

The Company has business trustsfor the purpose of issuing trust preferred securities.  We believe the continued consolidation ofthese trusts at December 31, 2003 was appropriate under Interpretation 46.  However, the application of Interpretation46R will be required by the Company for the fiscal year end December 31, 2004,at which time, the Company will be required to deconsolidate the trusts.  The deconsolidation of these trusts will nothave a material impact on the 2004 consolidated financial statements.

 

8

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In May 2003, the FASB issuedStatement No. 150 (“Statement 150”), *Accounting for Certain Financial Instruments withCharacteristics of both Liabilities and Equity*.  Statement 150 establishes standards for howa business enterprise classifies, measures and discloses in its financialstatements certain financial instruments with characteristics of bothliabilities and equity.  Statement 150requires that a business enterprise classify financial instruments that arewithin its scope as liabilities (or as assets in some circumstances).  Statement 150 was effective for contractsentered into or modified after May 31, 2003, and was otherwise effective at thebeginning of the first interim period beginning after June 15, 2003.  FASB Staff Position (FSP) 150-3 affects theaccounting for mandatorily redeemable non-controlling minority interests of allentities and for non-SEC registrants, defers the effective date of Statement150 and eliminates the disclosure requirements for certain mandatorily redeemableinstruments.  The adoption of Statement150 on July 1, 2003 did not have a material impact on the Company’sconsolidated financial statements, and the adoption of deferred provisions atJanuary 1, 2005 is not expected to have a material impact on the Company’sconsolidated financial statements.

 

9

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**NOTE 3**                                                    **SECURITIES**

 

Securities have been classifiedin the consolidated statements of financial condition according to management’sability and intent.  The carrying amountof securities and their approximate fair value follow:

 
|                               |   | **Amortized  Cost** |       | **Gross  unrealized** |       | **Fair  Value** |       |
|------------------------------------|--------|---------------------|------------|-----------------------|------------|-----------------|------------|
|                               |   |                | **Gains**  |                  | **Losses** |            |       |
| **Available-for-sale securities:** |   |                |       |                  |       |            |       |   |   |
| March 31, 2004:                    |   |                |       |                  |       |            |       |   |   |
| Mortgage-backed securities:        |   |                |       |                  |       |            |       |   |   |
| GNMA adjustable rate               |   | $                   | 2,291,297  |                  | $          | 5,597           |       | $ | 8,771 |   | $ | 2,288,123 |   |
| GNMA fixed rate                    |   | 577,504             |       | 35,417                |       | —          |       | 612,921 |   |
| Equity securities:                 |   |                |       |                  |       |            |       |   |   |
| FNMA common stock                  |   | 6,858               |       | 493                   |       | —          |       | 7,351 |   |
| FNMA bonds                         |   | 1,000,000           |       | 6,560                 |       | —          |       | 1,006,560 |   |
| FFCB bonds                         |   | 1,000,000           |       | 11,250                |       | —          |       | 1,011,250 |   |
| Trust preferred securities         |   | 555,000             |       | 51,460                |       | —          |       | 606,460 |   |
|                               |   | $                   | 5,430,659  |                  | $          | 110,777         |       | $ | 8,771 |   | $ | 5,532,665 |   |
| December 31, 2003:                 |   |                |       |                  |       |            |       |   |   |
| Mortgage-backed securities:        |   |                |       |                  |       |            |       |   |   |
| GNMA adjustable rate               |   | $                   | 2,476,208  |                  | $          | 9,837           |       | $ | 11,704 |   | $ | 2,474,342 |   |
| GNMA fixed rate                    |   | 680,182             |       | 42,420                |       | —          |       | 722,602 |   |
| Equity securities:                 |   |                |       |                  |       |            |       |   |   |
| FNMA common stock                  |   | 6,858               |       | 410                   |       | —          |       | 7,268 |   |
| FNMA bonds                         |   | 1,000,000           |       | —                |       | —          |       | 1,000,000 |   |
| FFCB bonds                         |   | 1,000,000           |       | 5,630                 |       | —          |       | 1,005,630 |   |
| Trust preferred securities         |   | 555,000             |       | 49,860                |       | —          |       | 604,860 |   |
|                               |   | $                   | 5,718,248  |                  | $          | 108,157         |       | $ | 11,704 |   | $ | 5,814,701 |   |
|                               |   |                |       |                  |       |            |       |   |   |
| **Held-to-maturity securities:**   |   |                |       |                  |       |            |       |   |   |
| March 31, 2004:                    |   |                |       |                  |       |            |       |   |   |
| Mortgage-backed securities:        |   |                |       |                  |       |            |       |   |   |
| GNMA adjustable rate               |   | $                   | 3,932,976  |                  | $          | 7,074           |       | $ | — |   | $ | 3,940,050 |   |
| FHLMC adjustable rate              |   | 269,365             |       | 2,020                 |       | 192             |       | 271,193 |   |
| FHLB bonds                         |   | 3,257,430           |       | 88,867                |       | —          |       | 3,346,297 |   |
| FHLMC bonds                        |   | 1,001,573           |       | 5,927                 |       | —          |       | 1,007,500 |   |
| US treasury bonds                  |   | 6,017,165           |       | 93,455                |       | —          |       | 6,110,620 |   |
| Corporate bonds                    |   | 829,474             |       | 10,268                |       | —          |       | 839,742 |   |
| Municipal bonds                    |   | 207,460             |       | —                |       | —          |       | 207,460 |   |
| Trust preferred securities         |   | 300,000             |       | 15,500                |       | —          |       | 315,500 |   |
|                               |   |                |       |                  |       |            |       |   |   |
|                               |   | $                   | 15,815,443 |                  | $          | 223,112         |       | $ | 192 |   | $ | 16,038,362 |   |
| December 31, 2003:                 |   |                | ** ** |                  | ** ** |            | ** ** |   | ** ** |
| Mortgage-backed securities:        |   |                |       |                  |       |            |       |   |   |
| GNMA adjustable rate               |   | $                   | 4,027,531  |                  | $          | —          |       | $ | 8,473 |   | $ | 4,019,059 |   |
| FHLMC adjustable rate              |   | 287,414             |       | 2,227                 |       | —          |       | 289,641 |   |
| FHLB bonds                         |   | 4,256,383           |       | 35,488                |       | —          |       | 4,291,872 |   |
| FHLMC bonds                        |   | 1,002,199           |       | 4,361                 |       | —          |       | 1,006,560 |   |
| US treasury bonds                  |   | 6,017,687           |       | 16,073                |       | —          |       | 6,033,760 |   |
| Corporate bonds                    |   | 870,725             |       | 3,871                 |       | 1,941           |       | 872,655 |   |
| Trust preferred securities         |   | 300,000             |       | 15,600                |       | —          |       | 315,600 |   |
|                               |   |                |       |                  |       |            |       |   |   |
|                               |   | $                   | 16,761,939 |                  | $          | 77,620          |       | $ | 10,414 |   | $ | 16,829,145 |   |

 

10

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**NOTE 4**                                                    **LOANSHELD-FOR-SALE**

 

The carrying amount of loansheld-for-sale and their estimated fair value, as determined on an aggregatebasis, follow:

 
|              |   |                |      | **Gross unrealized** |   |       |   |
|-------------------|--------|---------------------|-----------|----------------------|--------|------------|--------|
|              |   | **Amortized  cost** |      | **Gains**            |   | **Losses** |   | **Fair value** |   |
|              |   |                |      |                 |   |       |   |   |   |
| March 31, 2004    |   | $                   | 3,318,279 |                 | $      | 65,035     |   | $ | — |   | $ | 3,383,314 |   |
| December 31, 2003 |   | 1,797,290           |      | 37,274               |   | —     |   | 1,834,564 |   |
|                   |        |                     |           |                      |        |            |        |  |  |  |  |  |  |

 

**NOTE 5**                                                    **LOANSRECEIVABLE**

 

The components of loans in theconsolidated statements of financial condition were as follows:

 
|                                               |   | **March 31,  2004** |        | **December  31,  2003** |   |
|----------------------------------------------------|--------|---------------------|-------------|-------------------------|--------|
|                                               |   |                |        |                    |   |
| First mortgage loans:                              |   |                |        |                    |   |
| Conventional                                       |   | $                   | 72,282,104  |                    | $      | 75,526,322 |   |
| FHA insured and VA guaranteed                      |   | 9,243,809           |        | 8,741,925               |   |
| Commercial real estate loans                       |   | 38,405,576          |        | 36,527,727              |   |
| Commercial loans, other than mortgage              |   | 8,312,673           |        | 8,087,247               |   |
| Consumer and installment loans                     |   | 21,539,578          |        | 21,723,933              |   |
| Construction loans                                 |   | 6,653,169           |        | 2,231,421               |   |
| Other                                              |   | 6,552,620           |        | 6,524,285               |   |
|                                               |   |                |        |                    |   |
|                                               |   | 162,989,529         |        | 159,362,860             |   |
|                                               |   |                |        |                    |   |
| Less:                                              |   |                |        |                    |   |
| Loans in process                                   |   | 1,124,054           |        | 1,381,678               |   |
| Unearned discounts, deferred loan fees, and  other |   | 800,544             |        | 794,349                 |   |
| Allowance for loan losses                          |   | 1,012,583           |        | 949,516                 |   |
|                                               |   |                |        |                    |   |
|                                               |   | $                   | 160,052,348 |                    | $      | 156,237,317 |   |

 

11

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The allowance for loan lossesis established by management of the Bank to incorporate a systematicmethodology, which is applied quarterly, to determine the elements of theallowance for loan losses and the resultant provisions for loan losses itconsiders adequate to provide for anticipated loan losses.  This methodology includes the followingelements:

 

• A systematic loan grading system

• A periodic review of the summary ofthe allowance for loan loss balance using historical loss factors

• Identification of loans to beevaluated on an individual basis for impairment

• Consideration of internal factors suchas the Bank’s size, organizational structure, loan portfolio structure, loanadministration procedures, past due and delinquency trends, and loss experience

• Consideration of risks inherent indifferent kinds of lending

• Consideration of external factors suchas local, regional, and national economic factors

• An overall evaluation of the qualityof the underlying collateral, and holding and disposition costs

 

Specific allowances areprovided for individual loans where ultimate collection is consideredquestionable by management after reviewing the current status of loans that arecontractually past due as well as considering the net realizable value of thesecurity and of the loan guarantees, if applicable.  The following table is an analysis of changes in allowance forloan losses:

 
|                                             |   | **Three  Months Ended  March 31, 2004** |      | **Three  Months Ended  March 31, 2003** |   |
|--------------------------------------------------|--------|-----------------------------------------|-----------|-----------------------------------------|--------|
|                                             |   |                                    |      |                                    |   |
| Balance at beginning of period                   |   | $                                       | 949,516   |                                    | $      | 824,985 |   |
|                                             |   |                                    |      |                                    |   |
| Loans charged-off                                |   | (150,801                                | )         | (122,214                                | )      |
| Recoveries                                       |   | 868                                     |      | 52,313                                  |   |
|                                             |   |                                    |      |                                    |   |
| Net loans charged-off                            |   | (149,933                                | )         | (69,901                                 | )      |
| Provision for loan losses charged to  operations |   | 213,000                                 |      | 142,000                                 |   |
|                                             |   |                                    |      |                                    |   |
| Balance at end of period                         |   | $                                       | 1,012,583 |                                    | $      | 897,084 |   |

 

An analysis of the changes ofloans to directors, executive officers, and major stockholders is as follows:

 
|                                          |   | **Three  Months Ended  March 31, 2004** |      | **Year Ended  December 31, 2003** |   |
|-----------------------------------------------|--------|-----------------------------------------|-----------|-----------------------------------|--------|
|                                          |   |                                    |      |                              |   |
| Balance at beginning of period                |   | $                                       | 1,449,117 |                              | $      | 1,523,636 |   |
| Loans originated                              |   | —                                  |      | 873,700                           |   |
| Loan principal payments and other  reductions |   | (9,101                                  | )         | (948,219                          | )      |
|                                          |   |                                    |      |                              |   |
| Balance at end of period                      |   | $                                       | 1,440,016 |                              | $      | 1,449,117 |   |

 

12

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**NOTE 6****                                                    NON-PERFORMINGASSETS**

 

The composition of the Bank’s portfolio of non-performing assets isshown in the following table:

 
|                                            |   | **March 31,  2004** |    | **December 31,  2003** |   |
|-------------------------------------------------|--------|--------------------------|---------|-----------------------------|--------|
|                                            |   |                     |    |                        |   |
| Non-accruing loans*                             |   | $                        | 524,013 |                        | $      | 1,054,289 |   |
| Past due 90 days or more and still accruing     |   | —                   |    | —                      |   |
| Troubled debt restructured                      |   | —                   |    | —                      |   |
| Other real estate                               |   | 410,114                  |    | 565,159                     |   |
|                                            |   |                     |    |                        |   |
|                                            |   | $                        | 934,127 |                        | $      | 1,619,448 |   |
|                                            |   |                     |    |                        |   |
| Ratio of non-performing assets to total  assets |   | 0.46                     | %       | 0.79                        | %      |

 

----

*  Primarily loans which arepast due for 90 days or more

 

**NOTE 7****                                                    EARNINGSPER SHARE**

 

Basic earnings per common share has been computed by dividing netincome for the period by the weighted average number of common sharesoutstanding during the period.  Dilutedearnings per common share has been computed by dividing net income for theperiod by the weighted average number of common shares outstanding during theperiod adjusted for the assumed exercise of outstanding stock options and othercontingently issuable shares of common stock. Net income for basic and diluted earnings per share are the same, asthere are no contingently issuable shares of stock whose issuance would haveimpacted net income.

 

A reconciliation between basic and diluted weighted average common sharesoutstanding follows:

 
|                                                |   | **Three  Months Ended  March 31,** |   |
|-----------------------------------------------------|--------|-----------------------------------------|--------|
|                                                |   | **2004**                                |   | **2003** |   |
|                                                |   |                                    |   |   |   |
| Weighted average common Shares – Basic         |   | 1,247,587                               |   | 1,294,204 |   |
|                                                |   |                                    |   |   |   |
| Plus effect of dilutive securities:                 |   |                                    |   |   |   |
| Stock Options                                       |   | 78,988                                  |   | 33,968 |   |
| Shares held as Treasury Stock                       |   | 66,700                                  |   | 48,672 |   |
|                                                |   |                                    |   |   |   |
| Weighted average common Shares - Assuming  Dilution |   | 1,393,275                               |   | 1,376,844 |   |

 

13

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**NOTE 8****                                                    OFF-BALANCESHEET ARRANGEMENTS**

 

The Bank may be a party to financial instruments with off-statement offinancial condition risk in the normal course of business to meet the financingneeds of its customers and to reduce its own exposure to fluctuation ininterest rates.  These financial instrumentsinclude commitments to extend credit (including credit cards), standby lettersof credit, and financial guarantees. These instruments involve, to varying degrees, elements of credit andinterest rate risk in excess of the amount recognized in the consolidatedstatements of financial condition.  Thecontract or notional amounts of these instruments reflect the extent ofinvolvement the Bank has in particular classes of financial instruments.  The Bank uses the same credit policies inmaking commitments and conditional obligations as it does for the consolidatedstatements of financial condition instruments.

 

The following table details the amounts and expected maturities ofsignificant commitments as of March 31, 2004.

 
|                               |   | **Payments  Due In**   |   |                        |   |
|------------------------------------|--------|------------------------|--------|-----------------------------|--------|
|                               |   | **One  Year or  Less** |   | **One to  Three  Years**    |   | **Three to  Five  Years** |   | **Over  Five  Years** |   | **Total** |   |
|                               |   |                   |   | **(Dollars  in Thousands)** |   |   |   |   |   |
| Commitments to extend credit:      |   |                   |   |                        |   |   |   |   |   |   |   |
| Residential real estate loans      |   | $                      | 3,318  |                        | $      | — |   | $ | — |   | $ | — |   | $ | 3,318 |   |
| Lines of credit                    |   | 11,705                 |   | —                      |   | — |   | — |   | 11,705 |   |
| Credit cards                       |   | 2,371                  |   | —                      |   | — |   | — |   | 2,371 |   |
| Letters of credit                  |   | 80                     |   | —                      |   | — |   | — |   | 80 |   |
| Commitments to sell mortgage loans |   | 5,863                  |   | —                      |   | — |   | — |   | 5,863 |   |
|                                    |        |                        |        |                             |        |  |  |  |  |  |  |  |  |  |  |  |

 

Commitments to extend credit are agreements to lend to a customer aslong as there is no violation of any condition established in thecontract.  Commitments generally havefixed expiration dates or other termination clauses and may require payment ofa fee.  Some of the commitments areexpected to expire without being drawn upon. The total commitment amounts do not necessarily represent future cashrequirements.  The Bank evaluates eachcustomer’s creditworthiness on a case-by-case basis.  The amount of collateral obtained, if deemed necessary by the Bankupon extension of credit, is based on management’s credit evaluation of thecustomers.

 

Standby letters of credit and financial guarantees written areconditional commitments issued by the Bank to guarantee the performance of acustomer to a third party.  The creditrisk involved in issuing letters of credit is essentially the same as thatinvolved in extending loan facilities to customers.  The Bank holds collateral and personal guarantees as deemednecessary.

 

At March 31, 2004, the Bank had no open interest rate swaps,futures, options, or forward contracts.

 

14

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**NOTE 9****                                                    SUBSEQUENTEVENT**

 

The Bank announced on January 30, 2004, that it had reached adefinitive agreement with Matrix Capital Bank, a wholly owned subsidiary ofMatrix BanCorp, Inc., to acquire two branches of Matrix Capital Bank located inLas Cruces, New Mexico.  The acquisitionwas subject to regulatory approval and was approved April 7, 2004, theacquisition is expected to be completed on May 1, 2004.  As of January 30, 2004, deposits of thetwo Las Cruces branches to be acquired totaled about $80 million and loans thatwould be transferred totaled about $23 million.  The new branches will operate under the name AccessBank.

 

15

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**Item 2 – Management’s Discussion and Analysisor Plan of Operation**

 

**The following discussion should be read in conjunctionwith Access Anytime Bancorp, Inc.’s (“the Company”) 2003 Annual Report on Form10-KSB.**

** **

**General**

 

The Company is a Delaware corporation which was organized in 1996 forthe purpose of becoming the thrift holding company of FirstBank (the“Bank”).  The Bank is a federallychartered stock savings bank conducting business from eight banking locationsin Albuquerque, Clovis, Gallup, and Portales, New Mexico.  The Bank has a wholly owned subsidiary,FEDCO, which is currently inactive.

 

The Bank is principally engaged in the business of attracting retailand commercial deposits from the general public and investing those funds infirst mortgage loans in owner occupied, single-family residential loans,residential construction loans and commercial real estate loans.  In addition, the Bank originates consumerloans, including loans for the purchase of automobiles and home improvementloans, and commercial business loans including Small Business Administrationloans.

 

The most significant outside factors influencing the operations of theBank and other financial institutions include general economic conditions,competition in the local market place and the related monetary****andfiscal policies of agencies that regulate financial institutions.  More specifically, the cost of funds,primarily consisting of deposits, is influenced by interest rates on competinginvestments and general market rates of interest.  Lending activities are influenced by the demand for real estatefinancing and other types of loans, which in turn is affected by the interestrates at which such loans may be offered and other factors affecting loandemand and funds availability.  TheCompany considers the state of New Mexico as its primary trade area.  Federal government outlays in research anddevelopment, defense, and agriculture represent a significant portion of theNew Mexico economy.

 

The Bank announced on January 30, 2004, that it had reached adefinitive agreement with Matrix Capital Bank, a wholly owned subsidiary ofMatrix BanCorp, Inc., to acquire two branches of Matrix Capital Bank located inLas Cruces, New Mexico.  The acquisitionwas subject to regulatory approval and was approved April 7, 2004, theacquisition is expected to be completed on May 1, 2004.  As of January 30, 2004, deposits of thetwo Las Cruces branches to be acquired totaled about $80 million and loans thatwould be transferred totaled about $23 million.  The new branches will operate under the name AccessBank.

 

### **FinancialCondition**

### ** **

Total assets for the Company decreased by $752,314 or 0.37%, fromDecember 31, 2003 to March 31, 2004. The decrease in assets was primarily due to a decrease of approximately$4.5 million in cash and cash equivalents and $1.0 million in securitiesheld-to-maturity.  In addition, loansreceivable increased by $3.8 million and loans held-for-sale were up by $1.5million.

 

16

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Total liabilities decreased by $979,759 or 0.52% during the three-monthperiod ended March 31, 2004.  Adecrease of approximately $2.5 million in Federal Home Loan Bank advances wasthe primary reason for the decrease in total liabilities; the decrease inFederal Home Loan Bank advances was due to an increase in deposits of $1.8million.

 

### **CapitalAdequacy and Liquidity**

### ** **

**Capital Adequacy -**Underthe Financial Institutions Reform, Recovery and Enforcement Act of 1989(“FIRREA”) and the implementation of Office of Thrift Supervision (“OTS”)regulations on December 7, 1989, the Bank must have:  (1) Tier 1 or core capital equal to 3% ofadjusted total assets and (2) total capital equal to 8.0% of risk-weightedassets, which includes off-balance sheet items.

 

Under the Federal Deposit Insurance Corporation Improvement Act(“FDICIA”), to be deemed “well capitalized” the minimum ratios the Bank musthave are: (1) Tier 1 or core capital of 5% of adjusted total assets, (2) Tier 1risk-based capital of 6% of risk-weighted assets, and (3) total risk-basedcapital of 10% of risk weighted assets.

 

The following table is a reconciliation of the Bank’s capital forregulatory purposes at March 31, 2004, as reported to the OTS.

 
|                                                               |   | **Tier 1-  Core  Capital** |        | **Tier 1-  Risk-based  Capital** |        | **Total  Risk-based  Capital** |   |
|--------------------------------------------------------------------|--------|----------------------------|-------------|----------------------------------|-------------|--------------------------------|--------|
|                                                               |   |                       |        |                             |        |                           |   |
| Total regulatory assets                                            |   | $                          | 203,190,094 |                             |        |                           |   |   |
| Net unrealized appreciation on  available-for-sale securities, net |   | (67,227                    | )           |                             |        |                           |   |
| Less intangible assets disallowed for  regulatory purposes         |   | (1,541,569                 | )           |                             |        |                           |   |
|                                                               |   |                       |        |                             |        |                           |   |
| Adjusted regulatory total assets                                   |   | $                          | 201,581,298 |                             |        |                           |   |   |
|                                                               |   |                       |        |                             |        |                           |   |
| Risk-based assets                                                  |   |                       |        | $                                | 141,790,000 |                           | $      | 141,790,000 |   |
|                                                               |   |                       |        |                             |        |                           |   |
| Stockholder’s equity                                          |   | $                          | 22,078,666  |                             | $           | 22,078,666                     |   | $ | 22,078,666 |   |
| Net unrealized appreciation on  available-for-sale securities, net |   | (40,336                    | )           | (40,336                          | )           | (40,336                        | )      |
| General valuation allowance                                        |   | —                     |        | —                           |        | 894,748                        |   |
| Less intangible assets disallowed for  regulatory purposes         |   | (1,541,569                 | )           | (1,541,569                       | )           | (1,541,569                     | )      |
|                                                               |   |                       |        |                             |        |                           |   |
| Regulatory capital                                                 |   | 20,496,761                 |        | 20,496,761                       |        | 21,391,509                     |   |
| Regulatory capital required to be “well  capitalized”    |   | 10,079,065                 |        | 8,507,400                        |        | 14,179,000                     |   |
|                                                               |   |                       |        |                             |        |                           |   |
| Excess regulatory capital                                          |   | $                          | 10,417,696  |                             | $           | 11,989,361                     |   | $ | 7,212,509 |   |
|                                                               |   |                       |        |                             |        |                           |   |
| Bank’s capital to adjusted regulatory  assets                 |   | 10.17                      | %           |                             |        |                           |   |
|                                                               |   |                       |        |                             |        |                           |   |
| Bank’s capital to risk-based assets                           |   |                       |        | 14.46                            | %           | 15.09                          | %      |

 

17

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**Liquidity**

 

Liquidity enables the Bank to meet withdrawals of its deposits and theneeds of its loan customers.  The Bankmaintains its liquidity position through maintenance of cash resources and acore deposit base.  A further source isthe Bank’s ability to borrow funds.  TheBank is a member of the Federal Home Loan Bank (“FHLB”) which provides a sourceof borrowings to the Bank for asset and asset/liability matching.  FHLB borrowings were $14.5 and $17.1 millionat March 31, 2004 and December 31, 2003, respectively.

 

Liquidity risk results from the mismatching of assets and liabilitiescash flows.  Management choosesasset/liability strategies that promote stable earnings and reliablefunding.  Interest rate risk and fundingpositions are kept within limits established by the Board of Directors of theBank to ensure that risk taking is not excessive and that liquidity is properlymanaged.  The Bank keeps a portion ofits interest-bearing assets in adjustable-rate products to reduce interest ratesensitivity.  Therefore, if ratesincrease the Bank can retain its deposits by increasing rates paid on deposits,while limiting the impact on the Bank’s net interest margin.  A concentrated effort is made to retaindeposits associated with an unidentifiable intangible asset.  The primary additional source of funding isprovided by FHLB borrowings available to the Bank, of $71.0 and $52.0 millionat March 31, 2004 and December 31, 2003, respectively.

 

At March 31, 2004 and 2003, the Company had lines of credittotaling $400,000 each year from other banks. The Company had no borrowingsoutstanding under these arrangements at March 31, 2004 and March 31,2003.  The lines of credit bear marketrates of interest and borrowings thereunder are to be used for generalpurposes.

 

# **Results ofOperations**

# ** **

### **Three-MonthComparative Analysis for Periods March 31, 2004 and 2003**

### ** **

Net income for the quarter ended March 31, 2004 was $180,870 or$.14 per basic share compared to $267,221 or $.21 per basic share for thethree-months ended March 31, 2003, a decrease of $86,351 or 32.31%.

 

*Net Interest Income.*  Net interest income before provision forloan losses increased by 3.13% to $1,821,565 for the quarter endedMarch 31, 2004, compared to $1,766,258 for the same period in 2003.  The increase in net interest income beforeprovision for loan losses was primarily due to a decrease in interest expenseof $104,392.  The decrease in totalinterest expense for the quarter ended March 31, 2004 was due to adecrease in interest expense on deposits of $117,088, as compared to the samequarter in 2003.

 

18

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*Provision for LoanLosses.*  Thelevel of the allowance for loan losses is based on such factors as the amountof non-performing assets, historical loss experience, general economicconditions, the estimated fair value of the underlying collateral, and otherfactors which may affect the collectibility of loans.  During the first quarter of 2004, the provision for loan lossesincreased to $213,000 from $142,000 in the same quarter of 2003.  Provisions made in 2004 increased therelated allowance by $63,067, due to generally increasing loansreceivable.  Based on management’sanalysis of current conditions and changes in the loan mix, as indicated byincreases in commercial real estate, automobile, and credit card loans, theallowance is considered adequate. Although management believes it uses the best information available tomake such determinations, future adjustments to the allowance may be necessary,and net income could be significantly affected, if circumstances differsubstantially from the assumptions used in making initial determinations.  See Note 5 to the Consolidated FinancialStatements in this Form 10-QSB for additional discussion on the allowance forloan losses.

 

*Noninterest Income.*  During the quarter ended March 31,2004, noninterest income decreased by $154,597 to $631,694 compared to $786,291in 2003.  The decrease in noninterestincome for the quarter ended March 31, 2004 as compared to the samequarter in 2003 was primarily due to a decrease in gains on sales of mortgageloans held-for-sale of $173,524.  Thegains on sales of mortgage loans held-for-sale for the 2004 quarter were$224,614; gains on sales of mortgage loans in 2004 are expected to continue tobe lower, as compared to 2003.

 

*Noninterest Expense.*  Noninterest expense decreased to $1,864,455from $1,938,481 for the quarter ended March 31, 2004 compared to the samequarter in 2003.  The $74,026 decreasein noninterest expense was primarily due to a decrease in sales incentives asshown in salaries and employee benefits of $92,561.  The decrease in salaries and employee benefits is primarily dueto the decrease in sales incentives based on loan production in the firstquarter of 2004, as compared to 2003.

 

*Income Tax Expense.*  The income tax expense for the quarter endedMarch 31, 2004 decreased by $9,913 to $194,934 from $204,847 in the quarterended March 31, 2003.  The decreasein income tax expense is primarily due to a decrease in income before incometaxes of $96,264 for the quarter ended March 31, 2004 as compared to thesame quarter in 2003.

 

19

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**Net Interest Income**

 

The Company’s operating results are impacted by many factors, the mostimportant factor being the interest spread between the yield on loans andinvestments and the cost of funds.  Thefollowing table presents operating results for the Company.  The table presents for the periods indicatedthe total dollar amount of interest income from average interest-earning assetsand the resultant yields, as well as the interest expense on averageinterest-bearing liabilities, expressed both in dollars and rates.  No tax equivalent adjustments were made andall average balances are monthly average balances.  Non-accruing loans have been included in the table as loanscarrying a zero yield.

 
|                                                                     |   | **Quarter  ended March 31,** |        |
|--------------------------------------------------------------------------|--------|-----------------------------------|-------------|
|                                                                     |   | **2004**                          |        | **2003** |   |
|                                                                     |   | **Average  outstanding  balance** |        | **Interest  earned/  Paid** |   | **Yield/  Rate** |   | **Average  outstanding  balance** |   | **Interest  earned/  Paid** |   | **Yield/  Rate** |   |
|                                                                     |   |                              |        |   |   |   |   |   |   |   |   |   |   |
| Interest-earning assets:                                                 |   |                              |        |   |   |   |   |   |   |   |   |   |   |
| Loans receivable (1)                                                     |   | $                                 | 161,763,717 |   | $ | 2,593,157 |   | 6.41 | % | $ | 159,369,585 |   | $ | 2,702,157 |   | 6.78 | % |
| Mortgage-backed securities                                               |   | 7,294,080                         |        | 69,461 |   | 3.81 |   | 5,907,254 |   | 75,910 |   | 5.14 |   |
| Investment securities                                                    |   | 15,994,590                        |        | 127,765 |   | 3.20 |   | 3,028,342 |   | 39,277 |   | 5.19 |   |
| Other interest-earning assets                                            |   | 10,704,891                        |        | 45,269 |   | 1.69 |   | 16,404,681 |   | 67,393 |   | 1.64 |   |
|                                                                     |   |                              |        |   |   |   |   |   |   |   |   |   |   |
| Total interest-earning assets (1)                                        |   | $                                 | 195,757,278 |   | $ | 2,835,652 |   | 5.79 | % | $ | 184,709,862 |   | $ | 2,884,737 |   | 6.25 | % |
|                                                                     |   |                              |        |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing liabilities:                                            |   |                              |        |   |   |   |   |   |   |   |   |   |   |
| Deposits                                                                 |   | $                                 | 165,282,240 |   | $ | 748,926 |   | 1.81 | % | $ | 156,857,502 |   | $ | 866,014 |   | 2.21 | % |
| Federal Home Loan Bank advances                                          |   | 15,655,587                        |        | 101,761 |   | 2.60 |   | 13,283,211 |   | 92,736 |   | 2.79 |   |
| Other borrowings                                                         |   | 8,000,000                         |        | 163,400 |   | 8.17 |   | 8,000,000 |   | 159,729 |   | 7.99 |   |
|                                                                     |   |                              |        |   |   |   |   |   |   |   |   |   |   |
| Total interest-bearing liabilities                                       |   | $                                 | 188,937,827 |   | $ | 1,014,087 |   | 2.15 | % | $ | 178,140,713 |   | $ | 1,118,479 |   | 2.51 | % |
|                                                                     |   |                              |        |   |   |   |   |   |   |   |   |   |   |
| Net interest income before provision for  loan losses                    |   |                              |        | $ | 1,821,565 |   |   |   |   |   | $ | 1,766,258 |   |   |   |
| Net interest rate spread                                                 |   |                              |        |   |   | 3.64 | % |   |   |   |   | 3.74 | % |
|                                                                     |   |                              |        |   |   |   |   |   |   |   |   |   |   |
| Net interest-earning assets                                              |   | $                                 | 6,819,451   |   |   |   |   |   | $ | 6,569,149 |   |   |   |   |   |
| Net yield on average interest-earning  assets                            |   |                              |        |   |   | 3.72 | % |   |   |   |   | 3.82 | % |
|                                                                     |   |                              |        |   |   |   |   |   |   |   |   |   |   |
| Average interest-earning assets to average  interest-bearing liabilities |   |                              |        | 103.61 | % |   |   |   |   | 103.69 | % |   |   |

 

----

(1) Calculated net of loans in process

 

20

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**Item 3 – Controls and Procedures**

 

**Evaluationof Disclosure Controls and Procedures**

** **

**TheCompany carried out an evaluation, under the supervision and with theparticipation of the Company’s management, including the Company’s ChiefExecutive Officer and Chief Financial Officer, of the effectiveness of thedesign and operation of the Company’s disclosure controls and procedures as ofthe end of the period covered by this report. The Company’s disclosure controls and procedures are designed to ensurethat information required to be disclosed by the Company in its periodic Securitiesand Exchange Commission (“SEC”) filings is recorded, processed and reportedwithin the time periods specified in the SEC’s rules and forms.  Based on that evaluation, the ChiefExecutive Officer and Chief Financial Officer concluded that the Company’sdisclosure controls and procedures are effective in timely alerting them tomaterial information relating to the Company (including its consolidatedsubsidiaries) required to be included in the Company’s periodic SECfilings.  There was no change in theregistrant’s internal control over financial reporting that occurred during theregistrant’s most recent fiscal quarter that has materially affected, or isreasonably likely to materially affect, the Company’s internal control overfinancial reporting.**

** **

**Forward-LookingStatements**

 

When used in this Form 10-QSB, certain words or phrases are intended toidentify “forward-looking statements” within the meaning of the PrivateSecurities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties,including changes in economic conditions, including changes in governmentaloutlays in the Company’s market area, changes in policies by regulatoryagencies, fluctuations in interest rates, demand for loans in the Company’smarket area and competition, that could cause actual results to differmaterially from historical earnings and those presently anticipated orprojected.  The Company wishes tocaution readers not to place undue reliance on any such forward-lookingstatements, which speak only as of the date made.  The Company wishes to advise readers that the factors listedabove could affect the Company’s financial performance and could cause theCompany’s actual results for future periods to differ materially from anyopinions or statements expressed with respect to future periods in any currentstatements.

 

The Company does not undertake, and specifically disclaims anyobligation, to publicly release the results of any revisions which may be madeto any forward-looking statements to reflect events or circumstances after thedate of such statements or to reflect the occurrence of anticipated orunanticipated events.

 

21

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##### **PART II - OTHER INFORMATION**

##### ** **

# **Item 1 – Legal Proceedings**

# ** **

# **None**

# ** **

# **Item 2 – Changes in Securities and Small BusinessIssuer Purchases of Equity Securities**

# ** **

# **None**

# ** **

# **Item 3 – Defaults Upon Senior Securities**

# ** **

# **None**

# ** **

# **Item 4 – Submission of Matters to a Vote** of Security Holders

# ** **

None

# **Item 5 – Other Information**

# ** **

# **None**

# **Item 6 – Exhibits and Reports on Form 8-K**

# ** **

(a)                      Exhibit

2.2 Branch Purchase and Deposit Assumption Agreement datedJanuary 30, 2004 between Matrix Capital Bank, a federal savings bank, andFirstBank, a federal savings bank

 

10.3.6 Amendment Number Six to Profit Sharing and Employee StockOwnership Plan of FirstBank

 

31.1 Certification of Chief Executive Officer as adopted pursuant tosection 302 of the Sarbanes-Oxley Act of 2002

 

31.2 Certification of Chief Financial Officer as adopted pursuant tosection 302 of the Sarbanes-Oxley Act of 2002

 

32.1 Certification of Chief Executive Officer pursuant to 18 U.S.C.section 1350, as adopted pursuant to section 906 of theSarbanes-Oxley Act of 2002

 

32.2 Certification of Chief Financial Officer pursuant to 18 U.S.C.section 1350, as adopted pursuant to section 906 of theSarbanes-Oxley Act of 2002

 

22

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# **Item 6 – Exhibitsand Reports on Form 8-K (continued)**

# ** **

(b)                      Reports on Form 8-K.

1.  On January 30, 2004 theCompany filed a Form 8-K to announce that the Bank reached an agreement toacquire two Matrix Capital Banks branches in Las Cruces, New Mexico.

 

2.  On January 30, 2004 theCompany furnished a Form 8-K to announce its unaudited results of operationsfor the twelve months ended December 31, 2003.

 

23

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# **SIGNATURES**

# ** **

Pursuant to the requirements of Section 13 or 15(d) of theSecurities Exchange Act of 1934, the Registrant has duly caused this report tobe signed on its behalf by the undersigned, thereunto duly authorized.

 

 
|                            |                  | ACCESS ANYTIME BANCORP, INC.                    |
|---------------------------------|-----------------------|-------------------------------------------------|
|                            |                  |                                            |
|                            |                  |                                            |
| Date:  April 30, 2004 | /s/ Norman R. Corzine |                                            |
|                            |                  | Norman  R. Corzine, Chairman of the Board,      |
|                            |                  | Chief  Executive Officer                        |
|                            |                  | *(Duly Authorized  Representative)*             |
|                            |                  |                                            |
| Date:  April 30, 2004 | /s/ Ken Huey, Jr.     |                                            |
|                            |                  | Ken Huey, Jr., Chief Financial Officer          |
|                            |                  | Director                                        |
|                            |                  | *(Principal  Financial and Accounting Officer)* |
|                            |                  | *(Duly Authorized  Representative)*             |
|                            |                  |                                            |
| Date:  April 30, 2004 | /s/ Don K. Padgett    |                                            |
|                            |                  | Don K. Padgett, President                       |
|                            |                  | Director                                        |
|                            |                  | *(Duly Authorized  Representative)*             |
|                                 |                       |                                                 |  |  |

 

24

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