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, 2007 |
| { } |
TRANSITION
REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| |
For
the transition period from _____________________ to _____________________ |
| |
Commission
file number 000-50015 |
A. Full
title of the plan and the address of the plan, if different from that of the
issuer named below:
TierOne Bank Savings
Plan
B. Name
of issuer of securities held pursuant to the plan and the address of its
principal executive office:
TierOne Corporation
1235
“N” Street
Lincoln, Nebraska 68508
REQUIRED INFORMATION
The
following financial statements and supplemental schedule of the TierOne Bank Savings Plan
are filed herewith.
TIERONE BANK SAVINGS
PLAN
Financial Statements
and Supplemental Schedule
December 31, 2007,
2006 and 2005
(With Report of
Independent Registered Public Accounting Firm Thereon)
TIERONE BANK SAVINGS
PLAN
Table of Contents
|
Page |
Report of Independent Registered Public Accounting Firm |
1 |
Statements of Net Assets Available for Benefits as of December 31, 2007 and 2006 |
2 |
Statements of Changes in Net Assets Available for Benefits for the three-year period December 31, 2007 |
3 |
Notes to Financial Statements |
4 |
Schedule |
Schedule H, line 4i--Schedule of Assets (Held at End of Year) |
9 |
Report of Independent
Registered Public Accounting Firm
Employee Benefit Committee
TierOne
Bank Savings Plan:
We have audited the accompanying
statements of net assets available for benefits of the TierOne Bank Savings Plan (the
Plan) as of December 31, 2007 and 2006, and the related statements of changes in net
assets available for benefits for each of the years in the three-year period ended December 31, 2007. 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 the Plan as of December 31, 2007 and 2006, and the changes
in net assets available for benefits for each of the years in the the three-year period ended December 31, 2007 in
conformity with U.S. GAAP.
Our audits were performed for the
purpose of forming an opinion on the financial statements taken as a whole. The
supplemental schedule of assets (held at end of year), 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 Department of Labor’s Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income Security
Act of 1974. This supplemental schedule is the responsibility of the Plan’s
management. The supplemental schedule has been subjected to the auditing procedures
applied in the audits 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/ KPMG LLP
Lincoln, Nebraska
June
25, 2008
1
TIERONE BANK SAVINGS
PLAN
Statements of Net
Assets Available for Benefits
December
31, 2007 and 2006
|
2007
|
2006
|
Assets: |
|
|
| |
|
| |
|
| Investments: | | |
| At fair value: | | |
| Principal Guaranteed Interest Account | | |
$ | 2,239,929 |
|
| 2,453,874 |
|
| Principal Partners Large Cap Value II Account | | |
| 1,776,429 |
|
| 1,729,646 |
|
| Mason Street Mid Cap Growth Account | | |
| 618,584 |
|
| 335,681 |
|
| Principal International Stock Account | | |
| 4,842,656 |
|
| 4,373,753 |
|
| Principal International Small Company Account | | |
| 1,180,014 |
|
| 1,223,048 |
|
| Principal Large Cap Stock Index Account | | |
| 3,118,312 |
|
| 3,111,703 |
|
| Principal Money Market Account | | |
| 2,836,909 |
|
| 1,946,558 |
|
| Principal U.S. Property Account | | |
| 4,671,739 |
|
| 3,963,919 |
|
| Principal Bond and Mortgage Account | | |
| 3,118,263 |
|
| 3,093,283 |
|
| Principal Bond Emphasis Balanced Account | | |
| 397,363 |
|
| 389,868 |
|
| Principal Stock Emphasis Balanced Account | | |
| 429,743 |
|
| 403,594 |
|
| Principal Partners Small Cap Value II Account | | |
| 1,222,278 |
|
| 1,498,703 |
|
| Principal Partners Large Cap Blend Account | | |
| 2,455,833 |
|
| 2,371,295 |
|
| Principal Partners Large Cap Blend I Account | | |
| 2,583,075 |
|
| 2,742,135 |
|
| Principal Partners Large Cap Growth II Account | | |
| 1,699,526 |
|
| 460,679 |
|
| Principal Partners Large Cap Growth Account | | |
| -- |
|
| 729,659 |
|
| Principal Partners Mid Cap Growth I Account | | |
| 1,021,270 |
|
| 840,129 |
|
| Principal Mid Cap Stock Index Account | | |
| 1,538,041 |
|
| 1,433,022 |
|
| Principal International Emerging Markets Account | | |
| 3,068,211 |
|
| 1,961,743 |
|
| Principal Total Market Stock Index Account | | |
| 1,059,954 |
|
| 811,795 |
|
| TierOne Corporation Common Stock Account | | |
| 7,792,837 |
|
| 11,322,985 |
|
|
| |
| |
| Total assets | | |
| 47,670,966 |
|
| 47,197,072 |
|
Liabilities: | | |
| Accrued expenses | | |
| 31,965 |
|
| -- |
|
|
| |
| |
| Net assets available for benefits | | |
$ | 47,639,001 |
|
| 47,197,072 |
|
|
| |
| |
See accompanying notes to financial
statements.
2
TIERONE BANK SAVINGS
PLAN
Statements of Changes
in Net Assets Available for Benefits
Years ended
December 31, 2007, 2006, and 2005
|
2007
|
2006
|
2005
|
| Additions to net assets attributed to: |
|
|
| |
|
| |
|
| |
|
| Net appreciation (depreciation) in | | |
| fair value of investments | | |
$ | (6,627 |
) |
| 5,213,601 |
|
| 4,269,111 |
|
| Dividends | | |
| 108,745 |
|
| 121,863 |
|
| 62,919 |
|
|
| |
| |
| |
| Total investment income | | |
| 102,118 |
|
| 5,335,464 |
|
| 4,332,030 |
|
|
| |
| |
| |
| Contributions: | | |
| Employer | | |
| 779,330 |
|
| 676,335 |
|
| 629,956 |
|
| Participant | | |
| 2,333,667 |
|
| 2,086,158 |
|
| 1,891,437 |
|
| Rollover | | |
| 12,119 |
|
| 78,305 |
|
| 357,055 |
|
|
| |
| |
| |
| Total contributions | | |
| 3,125,116 |
|
| 2,840,798 |
|
| 2,878,448 |
|
|
| |
| |
| |
| Total additions | | |
| 3,227,234 |
|
| 8,176,262 |
|
| 7,210,478 |
|
|
| |
| |
| |
| Deductions from net assets attributed to: | | |
| Benefits paid to participants | | |
| 2,782,651 |
|
| 2,376,196 |
|
| 12,065,594 |
|
| Administrative expenses | | |
| 2,654 |
|
| 5,749 |
|
| 7,059 |
|
|
| |
| |
| |
| Total deductions | | |
| 2,785,305 |
|
| 2,381,945 |
|
| 12,072,653 |
|
|
| |
| |
| |
| Net increase (decrease) | | |
| 441,929 |
|
| 5,794,317 |
|
| (4,862,175 |
) |
| Net assets available for benefits: | | |
| Beginning of year | | |
| 47,197,072 |
|
| 41,402,755 |
|
| 46,264,930 |
|
|
| |
| |
| |
| End of year | | |
$ | 47,639,001 |
|
| 47,197,072 |
|
| 41,402,755 |
|
|
| |
| |
| |
See accompanying notes to financial
statements.
3
TIERONE BANK SAVINGS
PLAN
Notes to Financial
Statements
December 31, 2007,
2006, and 2005
| |
The
following description of the TierOne Bank (Bank) Savings Plan (Plan) provides only
general information. Participants should refer to the Plan agreement for a more complete
description of the Plan’s provisions. |
| |
The
Plan, established August 1, 1978 and restated as of January 1, 2006, is a
defined contribution 401(k) profit sharing plan and is administered by the Employee
Benefit Committee. It is subject to the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA). The Bank believes the Plan is in compliance with the
requirements of ERISA. |
| |
Employees
must complete six months of service to be eligible for participation in the Plan. The
employee must make an election to participate in the Plan and agree to make contributions
to the Plan by payroll deductions. |
| |
Employees
can contribute from 1% to 25% of their salary to the Plan. Participants who have attained
age 50 before the end of the Plan year are eligible to make catch-up contributions.
Participants may also contribute amounts representing distributions from other qualified
defined contribution plans. The Bank makes a matching contribution equal to 50% of an
employee’s contribution up to a maximum of 6% of the employee’s salary. The
Bank, in its discretion, may make additional contributions to the Plan not to exceed the
maximum amount deductible from the Bank’s income under the Internal Revenue Code
(IRC). Participants must be employed on December 31 to receive an allocation of the
Bank’s contribution. Participants direct the investment of their contributions plus
the Company’s contributions into various investment options offered by the Plan. |
| |
Each
participant’s account is credited with the participant’s contribution, an
allocation of the Bank’s contribution, investment gains and losses, and any
associated investment expenses. Administrative expenses are paid by the Bank. The benefit
to which a participant is entitled is the benefit that can be provided from the
participant’s vested account. |
| |
Participants
are vested immediately in their contributions plus actual earnings thereon. Plan
participants become 100% vested in the Bank’s matching contributions at three years
of service. |
| |
On
termination of service or retirement, a participant may elect to receive either a single
lump-sum amount equal to the value of the participant’s vested interest in the
participant’s account or a fixed-period annuity. Participants may also elect to
receive a taxable distribution of any part of their contributed vested account balance
prior to retirement if plan hardship requirements are met. |
TIERONE BANK SAVINGS
PLAN
Notes to Financial
Statements
December 31, 2007,
2006, and 2005
| |
For
the years ended December 31, 2007, 2006, and 2005, forfeitures in nonvested accounts
totaling $5,764, $12,476, and $13,171, respectively, were used to reduce employer
contributions. At December 31, 2007 and 2006, forfeited nonvested accounts totaled
$1,345 and $1,078, respectively. |
| (2) |
Summary
of Significant Accounting Policies |
| |
The
financial statements of the Plan are prepared under the accrual method of accounting. |
| |
(b) |
Investment
Valuation and Income Recognition |
| |
The
Plan’s investments are stated at fair value. Quoted market prices are used to value
investments. Each pooled separate account is valued at fair value at the close of each
business day. The net appreciation (depreciation) in pooled separate accounts as
reflected in the statements of changes in net assets available for benefits consists of
realized gains or losses and the unrealized appreciation and depreciation on those
investments during the year. |
| |
Purchases
and sales of securities are recorded on a trade-date basis. Interest income is recorded
on the accrual basis. Dividends are recorded on the ex-dividend date. |
| |
Benefits
are recorded when paid. |
| |
The
preparation of financial statements in conformity with U.S. generally accepted
accounting principles requires management to make estimates and assumptions that affect
the reported amounts of assets, liabilities, and changes therein, and disclosure of
contingent assets and liabilities at the date of the financial statements. Actual results
could differ from those estimates. |
| |
(e) |
Risks
and Uncertainties |
| |
The
Plan invests in various investment securities. Investment securities are exposed to
various risks, such as interest rates, market, and credit risks. Due to the level of risk
associated with certain investment securities and the level of uncertainty related to
changes in the value of investment securities, it is at least reasonably possible that
changes in risk in the near term could materially affect participants’ account
balances and the amounts reported in the statements of net assets available for benefits
and the statements of changes in net assets available for benefits. |
| |
(f) |
Concentrations
of Investments |
| |
Included
in the Plan’s net assets available for benefits at December 31, 2007 and 2006
are investments in TierOne Corporation common stock amounting to $7,792,837 and
$11,322,985, respectively, whose value could be subject to change based on market
conditions. At December 31, 2007 and June 19, 2008, the market value per share of TierOne Corporation common stock
was $22.15 and $5.31, respectively. This decline in market value would have the impact of increasing net depreciation by approximately
$5.9 million since the Plan year ended December 31, 2007. |
TIERONE BANK SAVINGS
PLAN
Notes to Financial
Statements
December 31, 2007,
2006, and 2005
| |
During
2007, 2006, and 2005, net appreciation (depreciation) in fair value of investments, was
as follows: |
|
2007
|
2006
|
2005
|
| American Century Income & Growth Account |
|
|
$ | -- |
|
| -- |
|
| (76,320 |
) |
| American Century Small Cap Value Account | | |
| -- |
|
| -- |
|
| (70,046 |
) |
| Principal Partners Large Cap Value II Account | | |
| (27,195 |
) |
| 264,308 |
|
| 98,547 |
|
| Mason Street Mid Cap Growth Account | | |
| 77,888 |
|
| (29,549 |
) |
| -- |
|
| Mason Street Aggressive Growth Account | | |
| -- |
|
| 40,281 |
|
| 11,589 |
|
| Principal Mid Cap Growth II Account | | |
| -- |
|
| (5 |
) |
| -- |
|
| Principal Guaranteed Interest Account | | |
| 162,032 |
|
| 73,879 |
|
| (9,106 |
) |
| Principal International Stock Account | | |
| 692,642 |
|
| 919,671 |
|
| 665,108 |
|
| Principal International Small Company Account | | |
| 137,335 |
|
| 265,154 |
|
| 196,524 |
|
| Principal Large Cap Stock Index Account | | |
| 158,553 |
|
| 409,882 |
|
| 110,721 |
|
| Principal Money Market Account | | |
| 104,888 |
|
| 81,076 |
|
| 63,582 |
|
| Principal U.S. Property Account | | |
| 561,972 |
|
| 485,753 |
|
| 490,443 |
|
| Principal Bond and Mortgage Account | | |
| 108,850 |
|
| 128,684 |
|
| 74,819 |
|
| Principal Bond Emphasis Balanced Account | | |
| 31,894 |
|
| 41,374 |
|
| 30,509 |
|
| Principal Stock Emphasis Balanced Account | | |
| 39,260 |
|
| 51,792 |
|
| 35,218 |
|
| Principal Partners Small Cap Value II Account | | |
| (117,604 |
) |
| 238,051 |
|
| 166,349 |
|
| Principal Partners Large Cap Blend Account | | |
| 131,484 |
|
| 311,683 |
|
| 87,967 |
|
| Principal Partners Large Cap Blend I Account | | |
| 18,545 |
|
| 361,975 |
|
| 163,143 |
|
| Principal Partners Large Cap Growth II Account | | |
| 206,069 |
|
| 30,965 |
|
| 11,669 |
|
| Principal Partners Large Cap Growth Account | | |
| 21,234 |
|
| 11,054 |
|
| 23,816 |
|
| Principal Mid Cap Growth I Account | | |
| 75,040 |
|
| 70,656 |
|
| 96,160 |
|
| Principal Mid Cap Stock Index Account | | |
| 120,969 |
|
| 128,337 |
|
| 132,882 |
|
| Principal International Emerging Markets Account | | |
| 799,860 |
|
| 446,138 |
|
| 259,696 |
|
| Principal Total Market Stock Index Account | | |
| 47,264 |
|
| 84,935 |
|
| 20,819 |
|
| TierOne Corporation Common Stock Account | | |
| (3,357,607 |
) |
| 797,507 |
|
| 1,685,022 |
|
|
| |
| |
| |
| | | |
$ | (6,627 |
) |
| 5,213,601 |
|
| 4,269,111 |
|
|
| |
| |
| |
TIERONE BANK SAVINGS
PLAN
Notes to Financial
Statements
December 31, 2007,
2006, and 2005
| |
The
following table represents the fair value of individual investments which exceed 5% of
the Plan’s net assets: |
|
2007
|
2006
|
2005
|
| Principal Guaranteed Interest Account |
|
|
$ | * |
|
| 2,453,874 |
|
| 2,330,446 |
|
| Principal International Stock Account | | |
| 4,842,656 |
|
| 4,373,753 |
|
| 3,280,119 |
|
| Principal Money Market Account | | |
| 2,836,909 |
|
| * |
|
| * |
|
| Principal Large Cap Stock Index Account | | |
| 3,118,312 |
|
| 3,111,703 |
|
| 2,755,494 |
|
| Principal U.S. Property Account | | |
| 4,671,739 |
|
| 3,963,919 |
|
| 3,187,887 |
|
| Principal Bond and Mortgage Account | | |
| 3,118,263 |
|
| 3,093,283 |
|
| 2,962,668 |
|
| Principal Partners Large Cap Blend Account | | |
| 2,455,833 |
|
| 2,371,295 |
|
| * |
|
| Principal Partners Large Cap Blend I Account | | |
| 2,583,075 |
|
| 2,742,135 |
|
| 2,162,877 |
|
| Principal International Emerging Markets Account | | |
| 3,068,211 |
|
| * |
|
| * |
|
| TierOne Corporation Common Stock Account | | |
| 7,792,837 |
|
| 11,322,985 |
|
| 10,924,422 |
|
| |
*
Did not meet the 5% threshold in the applicable year. |
| (4) |
Guaranteed
Interest Account with Insurer |
| |
The
Plan entered into a guaranteed interest account with Principal Life Insurance Company who
maintains the contributions in a pooled account. The guaranteed interest account is
credited with earnings on the underlying investments and charged for plan withdrawals and
administrative expenses charged by Principal Life Insurance Company. The guaranteed
interest account is included in the financial statements at fair value (which represents
contributions made under the contract plus earnings, less withdrawals and expenses) as it
is not fully benefit responsive. There are no reserves against contract value for credit
risk of the contract issuer or otherwise. The average yield and crediting interest rates
approximated 3.37%, 2.94%, and 2.94% for 2007, 2006, and 2005, respectively. The
crediting interest rate is based on an agreed-upon formula with the issuer, but cannot be
less than 0%. |
| (5) |
Related
Party Transactions |
| |
Certain
of the Plan’s investments are shares in pooled funds managed by Principal Life
Insurance Company. Principal Life Insurance Company is the custodian as defined by the
Plan, and therefore, these transactions qualify as party-in-interest. Fees paid by the
Plan for the administrative services amounted to $2,654, $5,749, and $7,059 for the years
ended December 31, 2007, 2006, and 2005, respectively. |
| |
Although
it has not expressed any intent to do so, the Company has the right under the Plan to
discontinue its contributions at any time and to terminate the Plan subject to the
provisions of ERISA. In the event of plan termination, participants would become 100%
vested in their employer contributions. |
TIERONE BANK SAVINGS
PLAN
Notes to Financial
Statements
December 31, 2007,
2006, and 2005
| |
The
Internal Revenue Service has determined and informed the Bank by a letter, dated June 19,
2002, that the Plan and related trust are designed in accordance with applicable sections
of the IRC. Although the Plan has been amended since receiving the determination letter,
the Plan administrator and the Plan’s tax counsel believe that the Plan is designed
and is currently being operated in compliance with the applicable requirements of the
IRC. |
| |
On
March 20, 2008, TierOne Corporation announced that its Board of Directors terminated
the merger agreement between TierOne Corporation and CapitalSource, Inc. Pursuant to the
terms of the merger agreement, either party had the right to terminate the merger
agreement if the proposed merger was not completed by February 17, 2008. |
Schedule
TIERONE BANK SAVINGS
PLAN
Schedule H, line 4i—Schedule of Assets (Held at End of Year)
December 31, 2007
(a)
|
(b)
Identity of issue, borrower,
lessor, or similar party
|
(c)
Description of investment,
including maturity date,
rate of interest, collateral,
par, or maturity value
|
(d)
Cost
|
(e)
Current value
|
|
Pooled funds on deposit with Principal Life Insurance Company: |
|
|
| * |
Principal Guaranteed Interest Account |
GIC, maturities through 2011 |
** |
$ 2,239,929 |
| * |
Principal Partners Large Cap Value II Account |
Pooled separate account |
** |
1,776,429 |
| * |
Mason Street Mid Cap Growth Account |
Pooled separate account |
** |
618,584 |
| * |
Principal International Stock Account |
Pooled separate account |
** |
4,842,656 |
| * |
Principal International Small Company Account |
Pooled separate account |
** |
1,180,014 |
| * |
Principal Large Cap Stock Index Account |
Pooled separate account |
** |
3,118,312 |
| * |
Principal Money Market Account |
Pooled separate account |
** |
2,836,909 |
| * |
Principal U.S. Property Account |
Pooled separate account |
** |
4,671,739 |
| * |
Principal Bond and Mortgage Account |
Pooled separate account |
** |
3,118,263 |
| * |
Principal Bond Emphasis Balanced Account |
Pooled separate account |
** |
397,363 |
| * |
Principal Stock Emphasis Balanced Account |
Pooled separate account |
** |
429,743 |
| * |
Principal Partners Small Cap Value II Account |
Pooled separate account |
** |
1,222,278 |
| * |
Principal Partners Large Cap Blend Account |
Pooled separate account |
** |
2,455,833 |
| * |
Principal Partners Large Cap Blend I Account |
Pooled separate account |
** |
2,583,075 |
| * |
Principal Partners Large Cap Growth II Account |
Pooled separate account |
** |
1,699,526 |
| * |
Principal Partners Mid Cap Growth I Account |
Pooled separate account |
** |
1,021,270 |
| * |
Principal Mid Cap Stock Index Account |
Pooled separate account |
** |
1,538,041 |
| * |
Principal International Emerging Markets Account |
Pooled separate account |
** |
3,068,211 |
| * |
Principal Total Market Stock Index Account |
Pooled separate account |
** |
1,059,954 |
| * |
TierOne Corporation Common Stock Account |
Corporate stock |
** |
7,792,837 |
|
|
|
|
|
| |
|
|
|
$ 47,670,966 |
|
|
|
|
|
* Indicates party-in-interest.
**
Historical cost information is omitted as it is no longer required for
participant-directed accounts.
See accompanying independent auditors’ report.
9
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons
who administer the employee benefit plan) have duly caused this annual report to be signed
on its behalf by the undersigned hereunto duly authorized.
| |
TIERONE BANK SAVINGS PLAN |
Dated: June 25, 2008 |
By: /s/ Gilbert G. Lundstrom |
|
Gilbert G. Lundstrom, on behalf of TierOne |
|
Bank as the Plan Administrator |
EXHIBIT INDEX
TIERONE
BANK SAVINGS PLAN
FORM 11-K
FOR THE FISCAL YEAR
ENDED DECEMBER 31, 2007
| Exhibit No. |
Description |
23 |
Consent of KPMG LLP |