MILLERSBURG, Ohio--(BUSINESS WIRE)--CSB Bancorp, Inc. (OTCBB:CSBB):
Second Quarter Highlights
|Quarter Ended||Quarter Ended|
June 30, 2014
June 30, 2013
|Diluted earnings per share||$||0.55||$||0.45|
|Return on average common equity||11.09||%||9.32||%|
|Return on average assets||1.02||%||0.88||%|
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 $609 million as of June 30, 2014. CSB provides a complete range of banking and other financial services to consumers and businesses through its wholly owned subsidiary, The Commercial and Savings Bank, with sixteen banking centers in Holmes, Wayne, Tuscarawas and Stark counties and Trust offices located in Millersburg and Wooster, Ohio.
This release contains forward-looking statements relating to present or future trends or factors affecting the banking industry, and specifically the financial condition and results of operations, including without limitation, statements relating to the earnings outlook of the Company, as well as its operations, markets and products. Actual results could differ materially from those indicated. Among the important factors that could cause results to differ materially are interest rate changes, softening in the economy, which could materially impact credit quality trends and the ability to generate loans, changes in the mix of the Company’s business, competitive pressures, changes in accounting, tax or regulatory practices or requirements and those risk factors detailed in the Company’s periodic reports and registration statements filed with the Securities and Exchange Commission. The Company undertakes no obligation to release revisions to these forward-looking statements or reflect events or circumstances after the date of this release.
|CSB BANCORP, INC.|
|CONSOLIDATED FINANCIAL HIGHLIGHTS|
|(Dollars in thousands except per share data)|
|EARNINGS||2nd Qtr||1st Qtr||4th Qtr||3rd Qtr||2nd Qtr||6 months||6 months|
|Net interest income FTE (a)||$||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|
|FTE adjustment (a)||70||71||78||78||76||141||151|
|Diluted earnings per share||0.55||0.52||0.45||0.51||0.45||1.07||0.95|
|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||%|
|Number of full-time equivalent employees||161||160||157||165||159|
|Book value/common share||$||20.18||$||19.69||$||19.15||$||19.06||$||18.78|
|Period-end common share mkt value||20.23||19.67||19.00||19.15||19.25|
|Market as a % of book||100.25||%||99.90||%||99.22||%||100.47||%||102.50||%|
|Cash dividends/common share||$||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|
|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|
|(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|
|dollars in thousands, except per share data|
|June 30,||June 30,|
|Cash and cash equivalents|
Cash and due from banks
|Interest-earning deposits in other banks||14,908||23,534|
|Federal funds sold||-||-|
|Total cash and cash equivalents||36,354||37,066|
|Available-for-sale, at fair-value||93,389||127,515|
|Restricted stock, at cost||4,613||5,463|
|Loans held for sale||562||103|
|Less allowance for loan losses||5,063||4,945|
|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|
|LIABILITIES AND SHAREHOLDERS' EQUITY|
|Accrued interest payable and other liabilities||2,178||2,423|
Common stock, $6.25 par value. Authorized 9,000,000 shares; issued 2,980,602 shares in 2014 and 2013
|Additional paid-in capital||9,950||9,964|
Treasury stock at cost - 243,517 shares in 2014 and 243,968 in 2013
|Accumulated other comprehensive loss||(580||)||(830||)|
|Total shareholders' equity||55,239||51,391|
|TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY||$||608,892||$||571,068|
|CSB BANCORP, INC.|
|CONSOLIDATED STATEMENTS OF INCOME|
dollars in thousands, except per share data
Six months ended
|Interest and dividend income:|
|Loans, including fees||$||4,631||$||4,441||$||9,060||$||9,008|
|Total interest and dividend income||5,484||5,173||10,820||10,473|
|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
|Service charges on deposits accounts||316||333||613||648|
|Debit card interchange fees||233||190||431||368|
|Gain on sale of loans||44||102||68||216|
|Total noninterest income||1,159||1,066||2,112||2,104|
|Salaries and employee benefits||2,110||2,042||4,129||4,092|
|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|
|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 per share:|
Note: Certain prior year balances have been reclassified to conform to the current year presentation.