UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
[ X ] Annual Report pursuant to Section 15(d) of the
Securities Exchange Act of 1934 for the fiscal year
ended December 31, 2006.
or
[ ] Transition Report pursuant to Section 15(d) of the
Securities Exchange Act of 1934 for the transition
period from ____________ to ______________.
Commission File Number: 0-11204
AmeriServ Financial
401(k) Profit Sharing Plan
(Full title of the plan)
AmeriServ Financial, Inc.
Main and Franklin Streets
Johnstown, PA 15901
(Name of issuer of the securities held pursuant to the plan and
the address of its principal executive office.)
Registrant's telephone number, including area code: (814) 533-5300
Notices and communications from the Securities and Exchange
Commission relating to this report should be forwarded to:
AmeriServ Financial, Inc.
Main and Franklin Streets
Johnstown, PA 15901
Attention: Nicholas E. Debias, Jr.
With a copy to:
Wesley R. Kelso, Esquire
Stevens & Lee
Suite 602
25 North Queen Street
Lancaster, PA 17603
(717) 399-6632
Item 1.
Financial Statements and Exhibits
a.
Financial Statements
1.
Report of Independent Registered Public Accounting Firm.
2.
Statement of Net Assets Available for Benefits as of December 31, 2006 and 2005.
3.
Statement of Changes in Net Assets Available for Benefits for the two years ended December 31, 2006 and 2005.
4.
Notes to Financial Statements.
b.
Exhibits
1.
Consent of S. R. Snodgrass, A.C.
2
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Trustees of AmeriServ Financial 401(k) Profit Sharing Plan
Johnstown, Pennsylvania
We have audited the accompanying statements of net assets available for benefits of AmeriServ
Financial 401(k) Profit Sharing Plan as of December 31, 2006 and 2005, and the related
statement of changes in net assets available for benefits for the years then ended. These financial
statements are the responsibility of the Plan’s management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the public company accounting
oversight board (United States). Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects,
the net assets available for benefits of AmeriServ Financial 401(k) Profit Sharing Plan as of
December 31, 2006 and 2005, and the changes in net assets available for benefits for the years
then ended, in conformity with U.S. generally accepted accounting principles.
Our audit was made for the purpose of forming an opinion on the basic financial statements
taken as a whole. The supplemental schedule of Assets Held for Investment Purposes as of
December 31, 2006, is presented for the purpose of additional analysis and is not a required part
of the basic financial statements, but is supplementary information required by the United States
Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The supplemental schedule is the responsibility of
Plan’s management. The supplemental schedule has been subjected to the auditing procedures
applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all
material respects in relation to the basic financial statements taken as a whole.
/s/ S.R. Snodgrass, A.C.
Wexford, PA
June 25, 2007
3
AMERISERV FINANCIAL 401(k) PROFIT SHARING PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
December 31, | ||
2006 | 2005 | |
ASSETS | ||
Investments, at fair value: | ||
Common / Collective Funds | $ 10,261,324 | $ 9,341,951 |
Mutual Funds | 9,101,166 | 7,715,742 |
AmeriServ Financial, Inc. | 579,714 | 565,318 |
Money Market | 870,296 | 480,944 |
Participant Loans | 393,710 | 295,070 |
Total Investments | 21,206,210 | 18,399,025 |
Contribution Receivable | 35,713 | 8,700 |
Accrued Interest Receivable | 148,175 | 86,961 |
Cash | 12 | 96,600 |
TOTAL ASSETS AVAILABLE FOR BENEFITS | 21,390,110 | 18,591,286 |
LIABILITIES | ||
Benefits Payable | - | 10,347 |
NET ASSETS AVAILABLE FOR BENEFITS | $ 21,390,110 | $ 18,580,939 |
The accompanying notes are an integral part of these financial statements. | ||
4
AMERISERV FINANCIAL 401(k) PROFIT SHARING PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
Year Ended December 31, | ||
2006 | 2005 | |
ADDITIONS IN NET ASSETS ATTRIBUTED TO: | ||
INVESTMENT INCOME: | ||
Net appreciation in fair value of investments | $ 1,735,651 | $ 528,620 |
Interest and dividends | 286,148 | 199,517 |
Capital gains | 214,496 | 126,374 |
Total Investment Income | 2,236,295 | 854,511 |
Contributions by employees | 729,520 | 728,437 |
Contributions by employer | 207,243 | 217,421 |
Rollovers | 136,832 | 55,138 |
Total Contributions | 1,073,595 | 1,000,996 |
Total Additions | 3,309,890 | 1,855,507 |
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO: | ||
Benefits paid directly to participants | 500,719 | 768,278 |
Net Increase | 2,809,171 | 1,087,229 |
NET ASSETS AVAILABLE FOR BENEFITS | ||
Beginning of the year | 18,580,939 | 17,493,710 |
End of the year | $ 21,390,110 | $ 18,580,939 |
The accompanying notes are an integral part of these financial statements. | ||
5
AMERISERV FINANCIAL 401(k) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - DESCRIPTION OF PLAN
The following brief description of the AmeriServ Financial 401(k) Profit Sharing Plan (the “Plan”) is provided for general information purposes only. Interested parties should refer to the Plan Document for a more comprehensive description of the Plan’s provisions.
1General
The Plan is a defined contribution plan covering the employees of AmeriServ Financial, Inc., and its wholly owned subsidiaries AmeriServ Financial Bank, AmeriServ Trust and Financial Services, and AmeriServ Associates, Inc. (the “Companies”), including members of the United Steelworkers of America, AFL-CIO-CLC, Local Union 2653-06 (the “Union”) who have attained the age of 21 and the earlier of completion of 12 consecutive months of service with at least 500 hours of service (employee deferrals) or 1,000 hours of service (employer discretionary contribution). As of June 30, 2006 the Company closed AmeriServ Associates, Inc. The former employees are no longer participating in the Plan. The Plan includes a 401(k) before-tax savings feature, which permits participants to defer compensation under Section 401(k) of the Internal Revenue Code. It is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA), as amended. The Plan is not covered by the Pension Benefit Guaranty Corporation.
Contributions
Employees may elect to contribute, through the 401(k) feature, 1 percent to 100 percent of their base salaries each period to the maximum amount permitted by the Internal Revenue Code. Employees may elect to have their contributions in 5 percent increments invested in one or more of 28 mutual funds, 6 common/collective portfolios, 1 money market fund, and the AmeriServ Financial, Inc. common stock administered by the Plan’s trustee. The diversified mutual fund investment options include a bond and government securities fund and various U.S. and foreign stock funds.
The Companies have the right to make a discretionary contribution to the Plan. Any contribution to be made will be on an annual basis, and such contribution is allocated as a percentage of compensation of eligible participants for the year. In addition, the Companies contribute 4 percent of employees’ gross compensation on behalf of Union employees.
Participant Accounts
Each participant’s profit sharing account is credited with Plan earnings. Allocations are based upon the proportionate value of all accounts. The benefit to which each participant is entitled is that which can be provided from the participant’s account.
6
NOTE 1 - DESCRIPTION OF PLAN (continued)
Vesting
Participants are immediately vested in their voluntary contributions plus actual earnings thereon. Vesting in the sponsor’s contributions in the Plan is based on completion of credited service years. A credited service year is considered one in which the participant completed at least 1,000 hours of service. Employees become 100 percent vested after five years of service.
Payment of Benefits
On termination of service, a participant will receive a lump sum amount equal to the vested value of his or her account. The Plan also provides for normal retirement benefits to be paid in the form of a lump sum upon reaching age 65 or termination of employment and has provisions for deferred, death, disability and retirement benefits, and hardship withdrawals.
Forfeitures
Forfeitures of a participant’s non-vested account shall be restored upon rehire if such rehire happens at any time during his or her 5th consecutive one-year break in service. At the end of the Plan year in which the former participant incurs his or her 5th consecutive one-year break in service, the forfeitures held on behalf of the participant will be allocated to all participants eligible to share in the allocations in the same proportion that each participant’s account balance bears to all account balances for such year. At December 31, 2006 and 2005, the forfeiture account had a balance of $31,094 and $41,994, respectively. Forfeitures totaling $7,797 and $16,366 for the years ended December 31, 2006 and 2005, respectively, were reallocated to participants’ accounts.
Administrative Expenses
Certain administrative functions are performed by officers and employees of the Companies. No such officer or employee receives compensation from the Plan. Certain other administrative expenses are paid directly by the Companies. Such costs amounted to $50,037 and $54,319 for the years ended December 31, 2006 and 2005, respectively.
Risks and Uncertainties
The Plan invests in various investment securities. Investment securities are exposed to various risks such as interest rate, market, and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants’ account balances and the amounts reported in the Statement of Net Assets Available for Benefits.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting principles followed by the Plan and the methods of applying these principles conform with U.S. generally accepted accounting principles.
A summary of the significant accounting and reporting policies applied in the presentation of the accompanying financial statements follows:
Accounting Estimates
The financial statements have been prepared in conformity with U.S. generally accepted accounting principles. In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts and disclosures. Actual results could differ significantly from those estimates.
Valuation of Investments
Quoted market prices are used to value investments. Investments for which there is no quoted market price are reported at their estimated fair value.
NOTE 3 - INVESTMENTS
The Plan investments are administered by AmeriServ Trust and Financial Services (Trustee).
During 2006, the Plan’s investments (including investments bought and sold, as well as, held during the year) appreciated in value by $1,735,651.
Net Appreciation (Depreciation) | ||
2006 | 2005 | |
Investments at fair value as determined by quoted market price: | ||
Common / Collective Funds | $ 1,042,227 | $ 460,175 |
Mutual Funds | 621,661 | 173,648 |
AmeriServ Financial, Inc. | 71,763 | (103,663) |
Sky Financial | - | (1,540) |
Net Appreciation in Fair Value | $ 1,735,651 | $ 528,620 |
Investments representing 5 percent or more of the Plan’s net assets at December 31 are as follows:
2006 | 2005 | |||
Principal | Fair | Principal | Fair | |
Investments at fair value as determined by quoted market price: | ||||
Dodge & Cox Balanced Fund | $ 1,275,534 | $ 1,504,801 | $ 1,049,203 | $ 1,220,548 |
Vanguard Institutional Index | 1,517,330 | 1,726,269 | 615,705 | 675,023 |
Pathroad Balance Growth & Income | 2,994,138 | 3,846,188 | 2,853,114 | 3,358,058 |
Pathroad Capital Appreciation & Income | 1,139,472 | 1,527,853 | 1,095,591 | 1,329,868 |
Pathroad Conservative Growth & Income | 2,004,615 | 2,508,833 | 2,406,678 | 2,784,514 |
Pathroad Long-Term Equity | 1,217,537 | 1,594,699 | 937,348 | 1,129,051 |
$ 10,148,626 | $ 12,708,643 | $ 8,341,934 | $ 9,822,039 | |
NOTE 4 - PLAN TERMINATION
Although it has not expressed any intent to do so, the Companies have the right, under the Plan, to discontinue their contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of termination of the Plan, participants will become 100 percent vested in their accounts.
NOTE 5 - TAX STATUS
The Internal Revenue Service has determined and issued a letter on July 27, 2005 informing the Bank that the Plan and related trust are designed in accordance with applicable sections of the Internal Revenue Code. Therefore, no provision for income taxes has been included in the Plan’s financial statements.
NOTE 6 – PARTY-IN-INTEREST TRANSACTIONS
Certain Plan investments are shares of mutual funds that are managed by the defined trustee of the Plan. The Plan also invests in the Plan Sponsor’s common stock. Therefore, related transactions qualify as related party transactions. All other transactions which may be considered parties-in-interest transactions relate to normal Plan management and administrative services and related payment of fees.
NOTE 7 - FAIR VALUE OF FINANCIAL INSTRUMENTS
Statement of Financial Accounting Standards No. 107, Disclosures About Fair Value of Financial Instruments, requires the Plan to disclose the estimated fair value of its financial instruments. Financial instruments are defined as cash, evidence of ownership interest in an entity, or a contract which creates an obligation or right to receive or deliver cash or another financial instrument from/to a second entity on potentially favorable or unfavorable terms. Fair value is defined as the amount at which a financial instrument could be exchanged in a current transaction between willing parties other than in a forced liquidation or sale. If a quoted market price is available for a financial instrument, the estimated fair value would be calculated based upon the market price per trading unit of the instrument.
Investments in mutual funds, participant loans, and cash would be considered financial instruments. At December 31, 2006 and 2005, the carrying amounts of these financial instruments approximate fair value.
7
AMERISERV FINANCIAL 401(k) PROFIT SHARING PLAN
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
EMPLOYER IDENTIFICATION NUMBER 25-0851535
PLAN NUMBER – 002
DECEMBER 31, 2006
Par or | Cost | Current | |||
Common Stock | |||||
*AmeriServ Financial, Inc. | 117,589 | $ | 578,613 | $ | 579,714 |
Total Common Stock | 579,714 | ||||
Mutual Funds | |||||
Alger Large Cap Growth | 1,328 | 16,743 | 18,266 | ||
Alger Midcap Growth | 2,552 | 40,854 | 43,205 | ||
CGM Focus Fund | 4,117 | 155,221 | 142,815 | ||
Dodge & Cox Balanced Fund | 17,281 | 1,275,534 | 1,504,801 | ||
Dodge & Cox Stock Fund | 4,154 | 609,379 | 637,527 | ||
Federated Kaufmann Fund | 52,906 | 286,887 | 299,448 | ||
Fidelity New Insights | 3,112 | 54,270 | 57,629 | ||
Fidelity Low-Priced Stock Fund | 20,322 | 673,541 | 884,818 | ||
Fidelity New Markets | 801 | 11,921 | 11,852 | ||
Franklin Biotechnology Discovery | 2,441 | 131,644 | 145,220 | ||
Franklin Mutual Beacon | 928 | 15,510 | 15,527 | ||
Goldman Sachs Global Income | 1,170 | 15,554 | 14,911 | ||
Janus Growth & Income | 1,517 | 44,003 | 58,059 | ||
Legg Mason Opportunity Trust | 3,020 | 53,794 | 58,226 | ||
Legg Mason Value Trust | 4,593 | 286,655 | 364,479 | ||
MFS International New Discovery Fund | 10,474 | 261,875 | 292,022 | ||
Northern Technology | 4,308 | 51,914 | 52,818 | ||
Pimco Total Return | 23,145 | 246,015 | 240,248 | ||
SEI Stable Asset | 860,291 | 860,291 | 860,291 | ||
T. Rowe Price Equity Income | 10,610 | 266,746 | 313,518 | ||
T. Rowe Price Financial Services | 1,126 | 25,932 | 24,070 | ||
Tweedy, Browne Global Value | 13,236 | 322,353 | 409,397 | ||
Vanguard GNMA | 11,130 | 116,083 | 113,641 | ||
Vanguard Health Care | 1,627 | 225,860 | 236,906 | ||
Vanguard Institutional Index | 13,321 | 1,517,330 | 1,726,269 | ||
Vanguard Primecap | 5,000 | 309,759 | 344,734 | ||
Vanguard Short-Term Admiral | 20,102 | 209,503 | 206,648 | ||
Vanguard Total Bond Market Index | 2,385 | 24,257 | 23,821 | ||
Total Mutual Funds | 9,101,166 | ||||
8
AMERISERV FINANCIAL 401(k) PROFIT SHARING PLAN
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
EMPLOYER IDENTIFICATION NUMBER 25-0851535
PLAN NUMBER – 002
DECEMBER 31, 2006
Par or | Cost | Current | |||
Common / Collective Funds | |||||
*Pathroad Balance Growth & Income | 271,623 | $ | 2,994,138 | $ | 3,846,188 |
*Pathroad Capital Appreciation & Income | 102,061 | 1,139,472 | 1,527,853 | ||
*Pathroad Conservative Fixed Income | 38,890 | 408,706 | 443,735 | ||
*Pathroad Conservative Growth & Income | 180,882 | 2,004,615 | 2,508,833 | ||
*Pathroad Intermediate-Term Fixed Income | 27,245 | 298,139 | 340,016 | ||
*Pathroad Long-Term Equity | 104,708 | 1,217,537 | 1,594,699 | ||
Total Common / Collective Funds | 10,261,324 | ||||
Money Market Funds | |||||
Goldman Sachs Financial Square Prime Obligation | 870,296 | 870,296 | 870,296 | ||
Total Money Market Funds | 870,296 | ||||
Participant Loans | 393,710 | 393,710 | 393,710 | ||
Total | $ | 21,206,210 | |||
*Party-In-Interest
9
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Trustees of the AmeriServ Financial 401(k) Profit Sharing Plan have duly caused this annual report to be signed on its behalf by the undersigned thereunto duly authorized.
Dated: June 26, 2007
AmeriServ Financial 401(k) Profit Sharing Plan
AmeriServ Trust and Financial
Services Company, as Trustee
By
_/s/ David M. Margetan___________
David M. Margetan, Assistant
Vice President and Assistant Secretary
10
Exhibit Index
Exhibit
1.
Consent of S. R. Snodgrass, A.C
11
Exhibit 1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Trustees of AmeriServ Financial 401(k) Profit Sharing Plan
Johnstown, Pennsylvania
We consent to the incorporation by reference in the Registration Statement Nos. 033-55845, 033-55207, and 033-55211 on Forms S-8 of AmeriServ Financial Inc. of our report dated June 25, 2007, relating to the financial statements and supplemental schedules of the AmeriServ Financial 401(k) Profit Sharing Plan as of and for the year ended December 31, 2006, appearing in this Annual Report on Form 11-K.
/s/S.R. Snodgrass, A.C.
Wexford, PA
June 25, 2007
12