EX-99.1 2 d761628dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

 

LOGO

CSB BANCORP, INC. REPORTS SECOND QUARTER EARNINGS

Second Quarter Highlights

 

     Quarter Ended
June 30, 2014
    Quarter Ended
June 30, 2013
 

Diluted earnings per share

   $ 0.55      $ 0.45   

Net Income

   $ 1,522,000      $ 1,247,000   

Return on average common equity

     11.09     9.32

Return on average assets

     1.02     0.88

Millersburg, Ohio – July 22, 2014 – CSB Bancorp, Inc. (CSBB) today announced second quarter 2014 net income of $1,522,000 or $.55 per basic and diluted share, as compared to $1,247,000 or $.45 per basic and diluted share for the same period in 2013.

Annualized returns on average common equity (“ROE”) and average assets (“ROA”) for the quarter were 11.09% and 1.02%, respectively, compared with 9.32% and 0.88% for the second quarter of 2013.

Eddie Steiner, President and CEO commented, “Loan demand has improved as businesses are investing in plant and equipment and signs of improved housing markets are emerging. We continue to focus on expanding customer relationships within our primary markets.”

Revenue, on a fully-taxable equivalent basis, totaled $6.3 million during the quarter, a 9% increase from the prior-year second quarter. Net interest income improved by $453 thousand as compared to second quarter 2013 while other income increased $93 thousand, attributable to a $133 thousand gain on sale of investments during the quarter.

Non-interest expense amounted to $3.8 million during the quarter, an increase of $186 thousand or 5% from second quarter 2013. The Company’s second quarter efficiency ratio amounted to 62.1% as compared to 63.4% for the same quarter in the prior year.


Net interest margin amounted to 3.66% for the quarter compared to 3.49% for the prior year’s second quarter. The margin improvement resulted from the combination of a $47 million increase in average balances of higher earning loans and investments, a $23 million average balance decrease in overnight investments, a $17 million average balance increase in noninterest bearing deposits and a 15 basis point decrease in interest rates paid on interest bearing deposits and borrowings.

Federal income tax provision totaled $683 thousand in second quarter 2014, compared to $538 thousand for the same quarter in 2013 reflecting an effective tax rate of 31% for current quarter versus 30% for the second quarter in 2013.

Average total assets during the quarter amounted to $598 million, an increase of $27 million or 4.6% above the same quarter of the prior year. Average loan balances of $411 million were $36 million or 9.5% above prior year second quarter, while average securities balances of $146 million increased $12 million or 9% as compared to second quarter 2013.

Average commercial loan balances for the quarter, including commercial real estate, increased $30 million or 12% above year ago levels. Average residential mortgage balances increased by $4 million or 5% over the prior year’s quarter. The increase of in-house mortgage balances was the result of the bank originating and retaining some 15 year fixed rate mortgages. Average home equity balances increased $1 million or 3%, and average consumer credit balances increased $300 thousand or 4% versus the same quarter of the prior year.

Net charge-offs during second quarter 2014 were $152 thousand compared to second quarter 2013 net loan charge-offs of $69 thousand. Annualized net charge-offs equated to 0.15% of average loans in the current quarter.

Nonperforming assets totaled $5.0 million or 1.22% of total loans plus other real estate at June 30, 2014, compared to $2.4 million or 0.63% at June 30, 2013. Delinquent loan balances as of June 30, 2014 amounted to 1.50% of total loans as compared to 1.08% at June 30, 2013. During first quarter 2014 a $2.9 million commercial relationship was placed on nonaccrual with an assigned specific reserve.

The Company funded $150 thousand in loan loss provision during the second quarter and the allowance for loan losses amounted to 1.23% of total loans on June 30, 2014. The ratio of the allowance for loan losses to nonperforming loans stood at 100.6% at June 30, 2014.

Average deposit balances grew by $7 million, or 2%, from the prior year’s second quarter. Average deposit balances totaled $469 million at June 30, 2014, reflecting a seasonal decrease of $10 million or 2% from the December 31, 2013 quarter. Within the deposit category, average noninterest-bearing account balances for the second quarter increased by $17 million,


or 17% above the same period in the prior year. Average interest-bearing checking, money market and traditional savings balances increased $14 million or 7% from year ago levels, while average time deposit balances decreased $23 million or 15% during the year. In addition to the changes in average deposit balances, the average balance of securities sold under repurchase agreement during the second quarter grew by $5 million or 13% above the average for the same period in the prior year. The repurchase agreements, while considered short-term borrowings, are primarily tied to overnight customer sweep accounts.

Shareholders’ equity totaled $55.2 million on June 30, 2014 with 2.7 million common shares outstanding. The tangible equity to assets ratio amounted to 8.3% on June 30, 2014, as compared to 8.1% on June 30, 2013. The Company declared a common dividend of $.18 per share during the quarter. Based on the June 30, 2014 closing stock price of $20.23 per share, the Company’s annual dividend yield approximates 3.6%.


About CSB Bancorp, Inc.

CSB is a financial holding company headquartered in Millersburg, Ohio, with approximate assets of $609 million as of June 30, 2014. 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 sixteen banking centers in Holmes, Wayne, Tuscarawas 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              
    2014     2014     2013     2013     2013     2014     2013  

EARNINGS

  2nd Qtr     1st Qtr     4th Qtr     3rd Qtr     2nd Qtr     6 months     6 months  

Net interest income FTE (a)

  $ 5,115      $ 4,969      $ 5,000      $ 4,755      $ 4,668      $ 10,084      $ 9,435   

Provision for loan losses

    150        185        210        210        210        335        420   

Other income

    1,159        953        1,024        1,190        1,066        2,112        2,104   

Other expenses

    3,849        3,677        3,992        3,634        3,663        7,526        7,222   

FTE adjustment (a)

    70        71        78        78        76        141        151   

Net income

    1,522        1,416        1,224        1,407        1,247        2,938        2,609   

Diluted earnings per share

    0.55        0.52        0.45        0.51        0.45        1.07        0.95   

PERFORMANCE RATIOS

         

Return on average assets (ROA)

    1.02     0.97     0.82     0.96     0.88     1.00     0.92

Return on average common equity (ROE)

    11.09     10.70     9.19     10.79     9.32     10.90     9.87

Net interest margin FTE (a)

    3.66     3.63     3.55     3.46     3.49     3.64     3.53

Efficiency ratio

    62.14     61.55     65.70     62.11     63.40     61.85     62.05

Number of full-time equivalent employees

    161        160        157        165        159       

MARKET DATA

         

Book value/common share

  $ 20.18      $ 19.69      $ 19.15      $ 19.06      $ 18.78       

Period-end common share mkt value

    20.23        19.67        19.00        19.15        19.25       

Market as a % of book

    100.25     99.90     99.22     100.47     102.50    

Price-to-earnings ratio

    9.97        10.19        9.90        10.19        10.64       

Cash dividends/common share

  $ 0.18      $ 0.18      $ 0.18      $ 0.18      $ 0.18        0.36      $ 0.36   

Common stock dividend payout ratio

    32.72     34.62     37.50     34.62     40.00     33.64     37.89

Average basic common shares

    2,737,085        2,736,634        2,736,634        2,736,634        2,736,555        2,736,861        2,736,309   

Average diluted common shares

    2,739,968        2,739,542        2,738,411        2,738,638        2,738,708        2,739,436        2,738,432   

Period end common shares outstanding

    2,737,085        2,736,634        2,736,634        2,736,634        2,736,634       

Common shares repurchased

    0        0        0        0        0       

Common stock market capitalization

  $ 55,371      $ 53,830      $ 51,996      $ 52,407      $ 52,680       

ASSET QUALITY

         

Gross charge-offs

  $ 163      $ 217      $ 226      $ 91      $ 95      $ 380      $ 111   

Net charge-offs

    152        205        202        78        69        357        55   

Allowance for loan losses

    5,063        5,065        5,085        5,077        4,945       

Nonperforming assets (NPAs)

    5,031        5,291        3,270        2,368        2,394       

Net charge-off/average loans ratio

    0.15     0.21     0.21     0.08     0.07     0.18     0.03

Allowance for loan losses/period-end loans

    1.23        1.24        1.34        1.35        1.31       

NPAs/loans and other real estate

    1.22        1.30        0.86        0.63        0.63       

Allowance for loan losses/nonperforming loans

    100.64        95.72        155.50        214.38        206.60       

CAPITAL & LIQUIDITY

         

Period-end tangible equity to assets

    8.26     8.12     7.94     7.92     8.11    

Average equity to assets

    9.20        9.08        8.89        8.89        9.39       

Average equity to loans

    13.39        13.55        14.05        13.81        14.30       

Average loans to deposits

    87.67        84.17        78.50        79.81        81.36       

AVERAGE BALANCES

         

Assets

  $ 598,093      $ 590,977      $ 594,736      $ 582,200      $ 571,569        594,555      $ 573,712   

Earning assets

    561,063        555,492        558,155        545,907        537,165        558,293        539,740   

Loans

    411,016        396,028        376,164        374,579        375,447        403,563        374,263   

Deposits

    468,838        470,487        479,174        469,353        461,488        469,658        462,246   

Shareholders’ equity

    55,052        53,681        52,861        51,745        53,677        54,371        53,320   

ENDING BALANCES

         

Assets

  $ 608,892      $ 601,978      $ 596,465      $ 593,895      $ 571,068       

Earning assets

    564,348        559,657        557,482        554,165        534,806       

Loans

    411,930        407,770        379,125        377,434        378,191       

Deposits

    483,672        466,573        480,933        480,861        462,845       

Shareholders’ equity

    55,239        53,879        52,411        52,149        51,391       

 

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 differs from net interest income under U.S. generally accepted accounting principles.


CSB BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

dollars in thousands, except per share data

 

     June 30,
2014
    June 30,
2013
 

ASSETS

    

Cash and cash equivalents

    

Cash and due from banks

   $ 21,446      $ 13,532   

Interest-earning deposits in other banks

     14,908        23,534   

Federal funds sold

     —          —     
  

 

 

   

 

 

 

Total cash and cash equivalents

     36,354        37,066   

Securities

    

Available-for-sale, at fair-value

     93,389        127,515   

Held-to-maturity

     38,946        —     

Restricted stock, at cost

     4,613        5,463   
  

 

 

   

 

 

 

Total securities

     136,948        132,978   

Loans held for sale

     562        103   

Loans

     411,930        378,191   

Less allowance for loan losses

     5,063        4,945   
  

 

 

   

 

 

 

Net loans

     406,867        373,246   

Goodwill and core deposit intangible

     5,422        5,554   

Bank owned life insurance

     9,681        9,419   

Premises and equipment, net

     8,503        8,326   

Accrued interest receivable and other assets

     4,555        4,376   
  

 

 

   

 

 

 

TOTAL ASSETS

   $ 608,892      $ 571,068   
  

 

 

   

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

    

Liabilities

    

Deposits:

    

Noninterest-bearing

   $ 124,768      $ 101,644   

Interest-bearing

     358,904        361,201   
  

 

 

   

 

 

 

Total deposits

     483,672        462,845   

Short-term borrowings

     50,523        41,851   

Other borrowings

     17,280        12,558   

Accrued interest payable and other liabilities

     2,178        2,423   
  

 

 

   

 

 

 

Total liabilities

     553,653        519,677   
  

 

 

   

 

 

 

Shareholders’ equity

    

Common stock, $6.25 par value. Authorized 9,000,000 shares; issued 2,980,602 shares in 2014 and 2013

     18,629        18,629   

Additional paid-in capital

     9,950        9,964   

Retained earnings

     32,184        28,586   

Treasury stock at cost - 243,517 shares in 2014 and 243,968 in 2013

     (4,944     (4,958

Accumulated other comprehensive loss

     (580     (830
  

 

 

   

 

 

 

Total shareholders’ equity

     55,239        51,391   
  

 

 

   

 

 

 

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

   $ 608,892      $ 571,068   
  

 

 

   

 

 

 


CSB BANCORP, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

dollars in thousands, except per share data

 

     Quarter ended
June 30,
     Year ended
June 30,
 
     2014      2013      2014      2013  

Interest and dividend income:

           

Loans, including fees

   $ 4,631       $ 4,441       $ 9,060       $ 9,008   

Taxable securities

     736         585         1,522         1,167   

Nontaxable securities

     115         128         230         255   

Other

     2         19         8         43   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total interest and dividend income

     5,484         5,173         10,820         10,473   
  

 

 

    

 

 

    

 

 

    

 

 

 

Interest expense:

           

Deposits

     289         448         593         923   

Other

     150         133         284         266   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total interest expense

     439         581         877         1,189   
  

 

 

    

 

 

    

 

 

    

 

 

 

Net interest income

     5,045         4,592         9,943         9,284   

Provision for loan losses

     150         210         335         420   
  

 

 

    

 

 

    

 

 

    

 

 

 

Net interest income after provision for loan losses

     4,895         4,382         9,608         8,864   
  

 

 

    

 

 

    

 

 

    

 

 

 

Noninterest income

           

Service charges on deposits accounts

     316         333         613         648   

Trust services

     202         226         418         440   

Debit card interchange fees

     233         190         431         368   

Gain on sale of loans

     44         102         68         216   

Other

     364         215         582         432   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total noninterest income

     1,159         1,066         2,112         2,104   
  

 

 

    

 

 

    

 

 

    

 

 

 

Noninterest expenses

           

Salaries and employee benefits

     2,110         2,042         4,129         4,092   

Occupancy expense

     240         255         506         513   

Equipment expense

     188         177         369         342   

Franchise tax expense

     106         147         213         294   

Professional and director fees

     214         174         396         291   

Federal deposit insurance

     91         84         177         172   

Amortization of intangible assets

     33         34         65         68   

Other expenses

     867         750         1,671         1,450   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total noninterest expenses

     3,849         3,663         7,526         7,222   
  

 

 

    

 

 

    

 

 

    

 

 

 

Income before income tax

     2,205         1,785         4,194         3,746   

Federal income tax provision

     683         538         1,256         1,137   
  

 

 

    

 

 

    

 

 

    

 

 

 

Net income

   $ 1,522       $ 1,247       $ 2,938       $ 2,609   
  

 

 

    

 

 

    

 

 

    

 

 

 

Net income per share:

           

Basic

   $ 0.55       $ 0.45       $ 1.07       $ 0.95   
  

 

 

    

 

 

    

 

 

    

 

 

 

Diluted

   $ 0.55       $ 0.45       $ 1.07       $ 0.95   
  

 

 

    

 

 

    

 

 

    

 

 

 

Note: Certain prior year balances have been reclassified to conform to the current year presentation.