United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 27, 2012
Camco Financial Corporation
(Exact name of registrant as specified in its charter)
DELAWARE |
000-25196 |
51-0110823 |
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(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
814 Wheeling Avenue, Cambridge, Ohio |
43725 |
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(Address of principal executive offices) | (Zip Code) |
Registrant's telephone number, including area code: (740) 435-2020
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): | ||
[ ] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
[ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
[ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
[ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. Results of Operations and Financial Condition.
On April 27, 2012 the Registrant issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
Exhibit 99.1. Press release dated April 27, 2012
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Camco Financial Corporation
(Registrant) |
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April 27, 2012
(Date) |
/s/ JOHN E. KIRKSEY
John E. Kirksey Chief Financial Officer |
Exhibit Index | ||
99.1 | Press release dated April 27, 2012 |
EXHIBIT 99.1
CAMBRIDGE, Ohio, April 27, 2012 (GLOBE NEWSWIRE) -- Camco Financial Corporation (Nasdaq:CAFI), the bank holding company for Advantage Bank, today announced first quarter financial results for 2012 reporting net earnings of $413,000 or $0.06 per share for the quarter ended March 31, 2012. This compares to $590,000 or $0.08 per share for the same quarter in 2011.
"We talked at the end of 2011 about taking another step forward to restoring the financial strength of our company. This progress continued during the first quarter of 2012," said James E. Huston, President and CEO. "We continue to focus on driving profitable business while remaining vigilant in decreasing our classified assets."
The Company's classified loans decreased by $585,000 during the first quarter of 2012 and core deposits increased by $22.8 million during this same time period, compared to the previous quarter. Additionally, noninterest income increased by $725,000 and noninterest expense decreased by $787,000, from the previous quarter.
"We are very pleased to see strong mortgage loan production during the first quarter leading to higher gain on sale income," commented Huston. "Additionally, we were able drive substantial increases in our core deposits during the first quarter all while decreasing our noninterest expense and increasing noninterest income. While our margin has compressed slightly due to lowering yields on earning assets, we will continue to look for pricing opportunities and improved credit quality to maintain this margin as we move through 2012."
Review of Financial Performance
Overview:
The following items summarize key activities of the Company during the quarter ended March 31, 2012:
Net Interest Margin:
Net interest margin decreased to 3.50% in the current quarter compared to 3.67% for the quarter ended December 31, 2011. The margin has also decreased from 3.63% for the same period a year ago, driven by a reduction in the bank's yield on earning assets in this low rate environment. Management expects the Company's net interest margin to remain stable or decrease slightly as we remain in an environment of low interest rates and slow economic growth. We will continue to look for pricing opportunities, further improvement in credit quality, and other ways to maintain our margin going forward.
Net Interest Income:
Net interest income before the provision for loan losses decreased $162,000, or 2.6% compared to the prior quarter, to $6.2 million for the quarter ended March 31, 2012. The decrease was attributable to reductions in yield on earning assets in this low rate environment.
The Company's yield on earning assets decreased to 4.76% in the current quarter from 5.01% in the linked quarter. The decreased overall yield resulted from declining loan portfolio balances, along with changes in the composition of investment balances resulting in a lower average investment yield. The cost of funds for the quarter ended March 31, 2012 was 1.36% compared to 1.42% for the quarter ended December 31, 2011. Planned continued runoff in certificates of deposits combined with growth in core deposits resulted in this reduced cost of funds. The Company anticipates continued declines in certificates of deposit balances over the next few quarters as some maturities of single relationship accounts are not renewed.
Provision Expense and Allowance for Loan Losses:
A provision for loan losses of $1.0 million was recorded for the quarter ended March 31, 2012, compared to $1.0 million for the same period of the prior year and ($0.8) million for the linked quarter. Classified loans (which includes substandard, doubtful, and loss) decreased $585,000 since December 31, 2011 to $40.4 million at March 31, 2011. The allowance for loan and lease losses as a percentage of non-performing loans increased to 61.4% at March 31, 2012 from 58.3% at December 31, 2011 and 53.2% at March 31, 2011.
Noninterest Income:
Noninterest income was $2.0 million for the first quarter of 2012, which represents an increase of $725,000 when compared to the linked quarter and a decrease of $988,000 when compared to the quarter ended March 31, 2011. The decreased income from the year ago quarter was driven by a reduction in gain on sale of investments, while the increase from the linked quarter is mostly due to higher gain on sale of mortgage loans and higher mortgage servicing rights valuation.
Noninterest Expense:
Noninterest expense for the quarter ended March 31, 2012, decreased $713,000, or 9.6% , to $6.7 million from the comparable period a year earlier and also decreased by $787,000, or 10.5%, when compared to the linked quarter. Noninterest expense was lower during the current quarter 2012 compared to the previous quarters primarily as a result of expenses related to classified loans and real estate owned.
Balance Sheet:
Total assets were $786.2 million, which is a decrease of $5.4 million, or 0.7% compared to $791.6 million a year earlier, and an increase of $19.2 million or 2.5% compared to $767.0 million in the linked quarter.
Total loan balances decreased $23.6 million, or 3.6%, to $630.1 million, while investment securities increased $41.9 million, or 200.2%, to $62.8 million when compared to the linked quarter.
Asset Quality:
Loan quality has improved but the economic recovery continues to be slow and has generally caused declines in the underlying value of collateral both in commercial and residential real estate. These factors continue to make it challenging to sustain a steady reduction in classified assets and non-performing loans.
A summary of certain key factors follows:
(dollars in thousands) | 3/31/2012 | 12/31/2011 | 12/31/2010 |
Classified Loans* | $40,444 | $41,029 | $53,992 |
Non-Performing Loans | 24,354 | 24,918 | 33,779 |
Loan Loss Reserve | 14,954 | 14,532 | 16,870 |
Loan Loss Reserve / Total Loans | 2.37% | 2.22% | 2.46% |
*Includes substandard, doubtful and loss (including homogeneous loans). |
Deposits and Borrowings:
Core deposits (defined as checking, savings and money market deposits) increased $22.8 million, or 8.0% to $306.8 million, while borrowed funds decreased $2.4 million, or 3.0%, to $77.9 million when compared to December 31, 2011. Certificates of deposit decreased $1.2 million, or 0.3%, during this period. The decrease was due to a reduction in internet CD deposits of $1.9 million. Contraction in these balances was planned as the Company works to reduce the level of non-core deposits, particularly higher single product certificates of deposits relating to rate sensitive shoppers.
FHLB advances and other borrowings decreased by $2.4 million, or 3.0%, to $77.9 million in the linked quarter.
Equity:
Stockholders' equity increased $504,000, or 1.1%, to $46.1 million at March 31, 2012, compared to $45.6 million at December 31, 2011. Net earnings of $413,000 for the quarter were the main driver of the increase.
About Camco Financial Corporation: Camco Financial Corporation, holding company for Advantage Bank, is a multi-state bank holding company headquartered in Cambridge, Ohio. Advantage Bank offers community banking that includes commercial, business and consumer financial services and internet banking from 22 offices. Additional information about Camco Financial may be found on the Company's web sites: www.camcofinancial.com or www.advantagebank.com.
The Camco Financial Corporation logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4639
The words or phrases "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project" or similar expressions are intended to identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties including changes in economic conditions in the Company's market area, changes in policies by regulatory agencies, fluctuations in interest rates, demands for loans in the Company's market area and competition, that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. The Company wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
Camco Financial Corporation | ||||||
Condensed Consolidated Statements of Financial Condition | ||||||
(In thousands, except for per share data and shares outstanding) | ||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||
3/31/12 | 12/31/11 | 9/30/11 | 6/30/11 | 3/31/11 | ||
Assets | ||||||
Cash and Cash Equivalents | 40,431 | 38,374 | 69,707 | 42,382 | 61,777 | |
Investments | 62,834 | 20,928 | 14,489 | 14,584 | 17,206 | |
Loans Held for Sale | 5,583 | 8,090 | 10,445 | 3,699 | 1,249 | |
Loans Receivable | 630,124 | 653,709 | 652,403 | 658,034 | 665,500 | |
Allowance for Loan Loss | (14,954) | (14,532) | (17,615) | (18,351) | (17,410) | |
Loans Receivable, Net | 615,170 | 639,177 | 634,788 | 639,683 | 648,090 | |
Other Assets | 62,149 | 60,449 | 62,577 | 65,578 | 63,245 | |
Total Assets | $ 786,167 | $ 767,018 | $ 792,006 | $ 765,926 | $ 791,567 | |
Liabilities | ||||||
Deposits | 650,853 | 629,259 | 624,327 | 631,647 | 655,597 | |
Borrowed Funds | 77,929 | 80,285 | 111,858 | 80,480 | 79,675 | |
Other Liabilities | 11,276 | 11,869 | 11,117 | 9,304 | 10,406 | |
Total Liabilities | 740,058 | 721,413 | 747,302 | 721,431 | 745,678 | |
Stockholders' Equity | 46,109 | 45,605 | 44,704 | 44,495 | 45,889 | |
Total Liabilities and Stockholders' Equity | $ 786,167 | $ 767,018 | $ 792,006 | $ 765,926 | $ 791,567 | |
Stockholders' Equity to Total Assets | 5.87% | 5.95% | 5.64% | 5.81% | 5.80% | |
Total Shares Outstanding | 7,468,087 | 7,205,595 | 7,205,595 | 7,205,595 | 7,205,595 | |
Book Value Per Share | $6.17 | $6.33 | $6.20 | $6.18 | $6.37 |
Camco Financial Corporation | |||||
Condensed Consolidated Statements of Operations | |||||
Quarterly Information | |||||
(In thousands, except for per share data and shares outstanding) | |||||
3 Months | 3 Months | 3 Months | 3 Months | 3 Months | |
Ended | Ended | Ended | Ended | Ended | |
3/31/12 | 12/31/11 | 9/30/11 | 6/30/11 | 3/31/11 | |
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |
Interest Income: | |||||
Loans | 8,213 | 8,501 | 8,715 | 8,839 | 8,901 |
Mortgage-backed securities | 16 | 17 | 19 | 24 | 316 |
Investment securities | 71 | 50 | 53 | 60 | 39 |
Interest-bearing deposits and other | 113 | 101 | 99 | 157 | 346 |
Total Interest Income | 8,413 | 8,669 | 8,886 | 9,080 | 9,602 |
Interest Expense: | |||||
Deposits | 1,551 | 1,640 | 1,734 | 1,918 | 2,189 |
Borrowings | 673 | 678 | 686 | 726 | 803 |
Total Interest Expense | 2,224 | 2,318 | 2,420 | 2,644 | 2,992 |
Net Interest Income | 6,189 | 6,351 | 6,466 | 6,436 | 6,610 |
Provision for Losses on Loans | 1,005 | (759) | 228 | 1,797 | 1,013 |
Net Interest Income After Provision for Loan Losses | 5,184 | 7,110 | 6,238 | 4,639 | 5,597 |
Noninterest Income: | |||||
Rent and other | 328 | 202 | 336 | 203 | 362 |
Loan servicing fees | 281 | 290 | 300 | 298 | 307 |
Service charges and other fees on deposits | 490 | 530 | 548 | 529 | 503 |
Gain on sale of loans | 564 | 377 | 129 | (92) | 30 |
Mortgage servicing rights | 102 | (365) | (352) | (132) | 271 |
Gain (loss) on sale of investment, mbs & fixed assets | (3) | -- | 2 | 2 | 1,278 |
Income on CSVL (BOLI) | 218 | 221 | 222 | 220 | 217 |
Total noninterest income | 1,980 | 1,255 | 1,185 | 1,028 | 2,968 |
Noninterest expense: | |||||
Employee compensation and benefits | 3,147 | 2,772 | 3,034 | 3,153 | 3,378 |
Occupancy and equipment | 711 | 721 | 767 | 691 | 761 |
Data processing | 286 | 277 | 273 | 277 | 284 |
Advertising | 87 | 86 | 95 | 96 | 86 |
Franchise taxes | 183 | 154 | 166 | 178 | 170 |
Other operating | 2,300 | 3,491 | 2,920 | 2,746 | 2,748 |
Total noninterest expense | 6,714 | 7,501 | 7,255 | 7,141 | 7,427 |
Earnings (loss) before provision for income taxes | 450 | 864 | 168 | (1,474) | 1,138 |
Provision for income taxes | 37 | 2 | 5 | (11) | 548 |
Net Earnings (loss) | 413 | 862 | 163 | (1,463) | 590 |
Earnings (Loss) Per Share: | |||||
Basic | $0.06 | $0.12 | $0.02 | ($0.20) | $0.08 |
Diluted | $0.06 | $0.12 | $0.02 | ($0.20) | $0.08 |
Basic Weighted Number of | |||||
Shares Outstanding | 7,220,018 | 7,205,595 | 7,205,595 | 7,205,595 | 7,205,595 |
Diluted Weighted Number of | |||||
Shares Outstanding | 7,220,130 | 7,205,595 | 7,205,595 | 7,205,595 | 7,205,595 |
Camco Financial Corporation | |||||||||
Selected Ratios and Statistics | |||||||||
(In thousands, except for per share data and shares outstanding) | |||||||||
3 Months | 3 Months | ||||||||
Ended | Ended | ||||||||
3/31/12 | 3/31/11 | ||||||||
(Unaudited) | (Unaudited) | ||||||||
Return on average equity | 3.61% | 5.11% | |||||||
Return on average assets | 0.21% | 0.29% | |||||||
Interest rate spread | 3.40% | 3.56% | |||||||
Net interest margin | 3.50% | 3.63% | |||||||
Yield on earning assets | 4.76% | 5.27% | |||||||
Cost of deposits | 1.08% | 1.45% | |||||||
Cost of borrowings | 3.42% | 3.30% | |||||||
Total cost of interest bearing liabilities | 1.36% | 1.71% | |||||||
Noninterest expense to average assets | 3.47% | 3.67% | |||||||
Efficiency ratio | 82.19% | 77.54% | |||||||
Nonperforming assets to total assets | 4.70% | 5.39% | |||||||
Non performing loans to total net loans including | 3.83% | 4.85% | |||||||
loans held for sale | |||||||||
Allowance for loan losses to total loans | 2.37% | 2.61% | |||||||
Ratios are based upon the mathematical average of the balances at the end of each month for the quarter and were annualized where appropriate |
Camco Financial Corporation | |||||||||||
Averages for Quarters Ended | |||||||||||
(In thousands, except for per share data and shares outstanding) | |||||||||||
March 31, 2012 | March 31, 2011 | ||||||||||
Average | Yield/ | Average | Yield/ | ||||||||
Balance | Interest | Rate | Balance | Interest | Rate | ||||||
Interest - Earning Assets: | |||||||||||
Loans receivable - net (1) | 622,459 | 8,213 | 5.28% | 640,908 | 8,901 | 5.56% | |||||
Securities (2) | 41,303 | 87 | 0.84% | 29,613 | 355 | 4.80% | |||||
FHLB Stock | 9,888 | 112 | 4.53% | 14,888 | 339 | 9.11% | |||||
Other interest bearing accounts | 32,969 | 1 | 0.01% | 43,783 | 7 | 0.06% | |||||
Total interest earning assets | 706,619 | 8,413 | 4.76% | 729,192 | 9,602 | 5.27% | |||||
Noninterest-earning assets | 68,022 | 80,613 | |||||||||
Total Average Assets | 774,641 | 809,805 | |||||||||
Interest-Bearing Liabilities: | |||||||||||
Deposits | 573,826 | 1,551 | 1.08% | 604,208 | 2,189 | 1.45% | |||||
Advances & Borrowings | 78,691 | 673 | 3.42% | 97,342 | 803 | 3.30% | |||||
Total interest-bearing liabilities | 652,517 | 2,224 | 1.36% | 701,550 | 2,992 | 1.71% | |||||
Noninterest-bearing sources: | |||||||||||
Noninterest-bearing liabilities | 76,351 | 62,115 | |||||||||
Shareholders' equity | 45,773 | 46,140 | |||||||||
Total Liabilities and Shareholders' Equity | 774,641 | 809,805 | |||||||||
Net Interest margin | 3.50% | 3.63% | |||||||||
Net Interest Income & Spread | 6,189 | 3.40% | 6,610 | 3.56% | |||||||
(1) Includes LHFS but does not include ALLL and Non-Accrual Loans | |||||||||||
(2) Includes securities designated as available for sale and held to maturity |
CONTACT: James E. Huston, CEO John E. Kirksey, CFO Phone: 740-435-2020