EX-99.1 2 l39442exv99w1.htm EX-99.1 exv99w1
Exhibit 99.1
(CSB BANCORP, INC. LOGO)
CSB BANCORP, INC. REPORTS EARNINGS FOR FIRST QUARTER 2010
First Quarter Highlights
    Net Income totals $737,000
 
    Diluted earnings per share of $0.27
 
    Return on average common equity of 6.44%
 
    Return on average assets of 0.67%
Millersburg, Ohio — April 20, 2010 — CSB Bancorp, Inc. (OTCBB: CSBB.ob) today announced first quarter 2010 net income of $737 thousand, or $.27 per basic and diluted share, as compared to $896 thousand, or $.33 per basic and diluted share for the same period in 2009.
Annualized returns on average common equity and average assets for the quarter were 6.44% and 0.67%, respectively, compared with 8.20% and 0.86% for the first quarter of 2009.
Eddie Steiner, President and CEO stated, “The past quarter’s earnings were reduced by soft loan demand, an increase in nonperforming commercial loan balances, and low prevailing interest rates on loans and investment securities. While first quarter earnings are below year ago levels, the Company continues to generate consistent profitability.”
Net interest income of $3.9 million decreased $13 thousand or 0.3% from the same quarter in the prior year. Net interest margin equated to 3.78% for the quarter, as compared to 3.99% during the first quarter of 2009. Total revenue of $4.7 million decreased 1.5% compared with revenue of the prior-year first quarter.
Non-interest expense totaled $3.0 million during the quarter, a decrease of $88 thousand, or 2.8%, from first quarter 2009. The Company’s first quarter efficiency ratio was 64.8%, as compared to same quarter results in the prior year of 67.4%.
Federal income tax expense was $315 thousand for first quarter 2010, reflecting an effective tax rate of 29.9%, compared to $424 thousand for the same quarter in 2009, or 32.1%. The decrease in the effective tax rate was primarily the result of a higher proportion of tax-exempt securities in the Company’s investment portfolio.
At March 31, 2010, assets totaled $436 million, down $15 million, or 3.3%, from December 31, 2009. Securities balances declined $7 million, or 8.6% as various securities matured or were called by the issuer. Total loan balances declined $2 million, or 0.7% to $312 million at March 31. Commercial loan balances, including commercial real estate, increased $800 thousand or 0.4% during the quarter ended March 31, residential mortgage and home equity

 


 

balances declined $2.2 million, or 1.9% during the quarter, while consumer installment, and other loan balances decreased $900 thousand, or 11.2%.
Net charge-offs for the quarter totaled $223 thousand, an annualized rate of 0.29% of average loan balances, as compared to $233 thousand or 0.30% during the first quarter of 2009.
As of March 31, 2010, nonperforming assets totaled $6.5 million, or 2.09% of period-end loans plus other real estate, compared with $4.3 million, or 1.37%, at the prior quarter-end. Commenting on the Company’s credit quality, Mr. Steiner noted, “Nonperforming assets have increased as difficult economic conditions continue to exert stress on some borrowers. We expect that nonperforming assets and net charge-offs will remain somewhat elevated through much of 2010. We have increased our allowance for loan losses and believe we are appropriately reserved for loss risks embedded in the loan portfolio.”
The Company’s allowance for loan losses at March 31, 2010 was 1.40% of period end loans and the Company funded $519 thousand in loan loss provision during the quarter. The ratio of allowance for loan losses to nonperforming loans stood at 70% at quarter-end.
Deposit balances totaled $326 million at quarter-end, a decrease of $3 million, or 1.0% from the prior quarter-end. Within the deposit category, non interest-bearing account balances decreased $1 million, or 2.5%. Interest bearing checking, money market and savings accounts declined $1 million, or 0.8%, during the quarter and time deposit balances decreased $1 million, or 0.6%%.
Short-term and other borrowings amounted to $62 million as of March 31, a decrease of $12 million or 16.2% from December 31 as the company repaid certain federal home loan bank advances that matured during the quarter.
Shareholders’ equity totaled $46 million on March 31, 2010 with 2.7 million common shares outstanding and a tangible equity to assets ratio of 10.1% at quarter-end. In concluding remarks, Mr. Steiner observed, “The Company’s capital and liquidity positions remain strong and provide stability to effectively meet the financial service needs of the communities we serve.”
The Company declared a common dividend of $0.18 per share during the quarter.
About CSB Bancorp, Inc.
CSB is a financial holding company headquartered in Millersburg, Ohio, with approximate assets of $436 million as of March 31, 2010. CSB provides a complete range of banking and other financial services to consumers and businesses through its wholly owned subsidiary, The Commercial and Savings Bank, with fourteen banking centers in Holmes, Tuscarawas, Wayne and Stark counties and Trust offices located in Millersburg and Wooster, Ohio.

 


 

Forward-Looking Statement
This release contains forward-looking statements relating to present or future trends or factors affecting the banking industry, and specifically the financial condition and results of operations, including without limitation, statements relating to the earnings outlook of the Company, as well as its operations, markets and products. Actual results could differ materially from those indicated. Among the important factors that could cause results to differ materially are interest rate changes, softening in the economy, which could materially impact credit quality trends and the ability to generate loans, changes in the mix of the Company’s business, competitive pressures, changes in accounting, tax or regulatory practices or requirements and those risk factors detailed in the Company’s periodic reports and registration statements filed with the Securities and Exchange Commission. The Company undertakes no obligation to release revisions to these forward-looking statements or reflect events or circumstances after the date of this release.
Contact Information:
Paula J. Meiler, SVP & CFO
330-763-2873
paula.meiler@csb1.com

 


 

CSB BANCORP, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)
(Dollars in thousands except per share data)
                                         
    Quarters
    2010   2009   2009   2009   2009
EARNINGS   1st Qtr   4th Qtr   3rd Qtr   2nd Qtr   1st Qtr
 
Net interest income FTE (a)
  $ 3,935     $ 4,231     $ 3,920     $ 3,884     $ 3,940  
Provision for loan losses
    519       409       293       394       241  
Other income
    731       769       870       780       796  
Other expenses
    3,041       3,191       3,188       3,210       3,129  
FTE adjustment (a)
    54       56       56       52       46  
Net income
    737       931       858       706       896  
Diluted EPS
    0.27       0.34       0.31       0.26       0.33  
 
                                       
PERFORMANCE RATIOS
                                       
Return on average assets (ROA)
    0.67 %     0.84 %     0.80 %     0.67 %     0.86 %
Return on average common equity (ROE)
    6.44 %     8.04 %     7.49 %     6.32 %     8.20 %
Net interest margin FTE (a)
    3.78 %     4.01 %     3.84 %     3.88 %     3.99 %
Efficiency ratio
    64.83 %     63.51 %     66.10 %     68.80 %     67.37 %
Number of full-time equivalent employees
    140       144       146       141       139  
 
                                       
MARKET DATA
                                       
Book value/common share
  $ 16.88     $ 16.76     $ 16.67     $ 16.34     $ 16.23  
Period-end common share mkt value
    14.60       15.25       15.20       16.00       14.00  
Market as a % of book
    86.49 %     90.99 %     91.18 %     97.92 %     86.26 %
PE ratio
    12.37       12.30       12.77       12.80       11.11  
Cash dividends/common share
  $ 0.18     $ 0.18     $ 0.18     $ 0.18     $ 0.18  
Common stock dividend payout ratio
    66.67 %     52.94 %     58.06 %     69.23 %     54.55 %
Average basic common shares
    2,734,799       2,734,799       2,734,799       2,734,799       2,734,799  
Average diluted common shares
    2,734,799       2,734,799       2,734,799       2,734,799       2,734,799  
Period end common shares outstanding
    2,734,799       2,734,799       2,734,799       2,734,799       2,734,799  
Common shares repurchased
    0       0       0       0       0  
Common stock market capitalization
  $ 39,928     $ 41,706     $ 41,569     $ 43,757     $ 38,287  
 
                                       
ASSET QUALITY
                                       
Gross charge-offs
  $ 289     $ 82     $ 82     $ 431     $ 290  
Net charge-offs (recoveries)
    223       46       (6 )     398       233  
Allowance for loan losses
    4,356       4,060       3,697       3,398       3,402  
Nonperforming assets (NPAs)
    6,492       4,303       4,545       4,123       4,182  
Net charge-off/average loans ratio
    0.29 %     0.06 %     (0.01 )%     0.50 %     0.30 %
Allowance for loan losses/period-end loans
    1.40       1.29       1.17       1.07       1.07  
NPAs/loans and other real estate
    2.09       1.37       1.44       1.29       1.31  
Allowance for loan losses/nonperforming loans
    70.02       98.04       82.05       83.47       82.51  
 
                                       
CAPITAL & LIQUIDITY
                                       
Period-end tangible equity to assets
    10.15 %     9.73 %     10.26 %     10.16 %     10.09 %
Average equity to assets
    10.44       10.45       10.68       10.56       10.50  
Average equity to loans
    14.89       14.54       14.38       14.06       13.91  
Average loans to deposits
    95.35       100.69       105.15       104.76       105.76  
 
                                       
AVERAGE BALANCES
                                       
Assets
  $ 444,916     $ 439,688     $ 425,439     $ 423,767     $ 421,694  
Earning assets
    422,487       418,737       404,629       401,966       400,356  
Loans
    311,789       315,168       316,149       319,421       318,325  
Deposits
    326,986       313,016       300,652       304,910       300,993  
Shareholders’ equity
    46,440       45,964       45,449       44,918       44,294  
 
                                       
ENDING BALANCES
                                       
Assets
  $ 435,622     $ 450,666     $ 427,391     $ 422,416     $ 422,390  
Earning assets
    413,771       428,301       406,054       401,558       402,011  
Loans
    310,900       313,482       314,717       317,880       319,425  
Deposits
    326,204       329,486       302,898       300,513       304,591  
Shareholders’ equity
    46,171       45,822       45,580       44,678       44,392  
NOTES:
 
(a) — Net Interest income on a fully tax-equivalent (“FTE”) basis restates interest on tax-exempt securities and loans as if such interest were subject to federal income tax at the statutory rate. Net interest income on an FTE basis is not an accounting principle generally accepted in the United States of America.

 


 

CSB BANCORP, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
                 
    March 31,     March 31,  
    2010     2009  
ASSETS
               
Cash and cash equivalents
               
Cash and due from banks
  $ 7,537,477     $ 7,479,007  
Interest-earning deposits in other banks
    29,144,457       12,072,028  
Federal funds sold
    0       0  
 
           
Total cash and cash equivalents
    36,681,934       19,551,035  
Securities
               
Available-for-sale, at fair-value
    68,263,879       65,282,581  
Restricted stock, at cost
    5,463,100       5,231,800  
 
           
Total securities
    73,726,979       70,514,381  
Loans
    310,899,540       319,424,751  
Less allowance for loan losses
    4,356,168       3,401,888  
 
           
Net loans
    306,543,372       316,022,863  
 
               
Goodwill and core deposit intangible
    2,178,672       1,965,710  
Bank owned life insurance
    2,879,967       2,774,893  
Premises and equipment, net
    8,224,107       8,368,805  
Accrued interest receivable and other assets
    5,386,840       3,192,356  
 
           
 
               
TOTAL ASSETS
  $ 435,621,871     $ 422,390,043  
 
           
 
               
LIABILITIES AND SHAREHOLDERS’ EQUITY
               
Liabilities
               
Deposits:
               
Noninterest-bearing
  $ 52,607,354     $ 42,685,916  
Interest-bearing
    273,596,610       261,904,865  
 
           
Total deposits
    326,203,964       304,590,781  
 
               
Short-term borrowings
    29,620,614       20,416,999  
Other borrowings
    32,209,756       50,590,025  
Accrued interest payable and other liabilities
    1,416,545       2,400,564  
 
           
Total liabilities
    389,450,879       377,998,369  
 
           
Shareholders’ equity
               
Common stock, $6.25 par value. Authorized 9,000,000 shares; issued 2,980,602 shares in 2010 and 2009
    18,628,767       18,628,767  
Additional paid-in capital
    9,993,812       9,987,999  
Retained earnings
    21,391,250       20,127,651  
Treasury stock at cost - 245,803 shares in 2010 and 2009
    (5,014,541 )     (5,014,541 )
Accumulated other comprehensive income
    1,171,704       661,798  
 
           
Total shareholders’ equity
    46,170,992       44,391,674  
 
           
 
               
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
  $ 435,621,871     $ 422,390,043  
 
           

 


 

CSB BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
                 
    Quarter ended  
    March 31,  
    2010     2009  
Interest and dividend income:
               
Loans, including fees
  $ 4,302,098     $ 4,620,756  
Taxable securities
    750,405       887,867  
Nontaxable securities
    83,840       67,997  
Other
    19,122       2,724  
 
           
Total interest and dividend income
    5,155,465       5,579,344  
Interest expense:
               
Deposits
    876,002       1,162,395  
Other
    398,772       523,389  
 
           
Total interest expense
    1,274,774       1,685,784  
 
               
Net interest income
    3,880,691       3,893,560  
Provision for loan losses
    519,160       241,072  
 
           
Net interest income after provision for loan losses
    3,361,531       3,652,488  
 
           
Non-interest income
               
Service charges on deposits accounts
    269,101       293,300  
Trust services
    141,581       114,759  
Securities gains
    0       116,080  
Gain on sale of loans
    45,724       67,569  
Other
    275,029       204,447  
 
           
Total non-interest income
    731,435       796,155  
Non-interest expenses
               
Salaries and employee benefits
    1,604,586       1,708,364  
Occupancy expense
    219,706       243,345  
Equipment expense
    126,753       133,745  
Franchise tax expense
    135,050       109,790  
Professional and director fees
    153,835       143,762  
Other expenses
    800,921       789,894  
 
           
Total non-interest expenses
    3,040,851       3,128,900  
 
           
Income before income tax
    1,052,115       1,319,743  
 
           
Federal income tax provision
    314,800       423,800  
 
           
 
               
Net income
  $ 737,315     $ 895,943  
 
           
Net income per share
               
Basic
  $ 0.27     $ 0.33  
 
           
 
               
Diluted
  $ 0.27     $ 0.33  
 
           
Note: Certain prior year balances have been reclassified to conform to the current year presentation.