Press Release  | April 25, 2011


First Quarter Highlights        


                                                                 Quarter Ended                              Quarter Ended
March 31, 2011                          March 31, 2010

Diluted earnings per share                                         $.33                                           $.27

Net Income                                                       $896,000                                   $737,000

Return on average common equity                          7.67%                                          6.44%

Return on average assets                                        0.80%                                          0.67%


Millersburg, Ohio – April 25, 2011 – CSB Bancorp, Inc. (OTCBB: CSBB.ob) today announced first quarter 2011 net income of $896 thousand or $.33 per basic and diluted share, as compared to $737 thousand or $.27 per basic and diluted share for the same period in 2010. 

Annualized returns on average common equity (“ROE”) and average assets (“ROA”) for the quarter were 7.67% and 0.80%, respectively, compared with 6.44% and 0.67% for the first quarter of 2010.

Eddie Steiner, President and CEO commented, “We are pleased that first quarter net income was 21% above the year ago level.  Credit quality within our loan portfolio continues to improve, allowing more-normalized provisioning for future loan losses.  We are also encouraged by signs of improving business conditions within our commercial customer base; however, it appears high unemployment continues to restrain consumer borrowing and spending.”

Revenue totaled $4.8 million for the first quarter of 2011, an increase of 1.9% from the prior-year first quarter.  Increases were reflected in both net interest income and other income.  First quarter net interest income on a fully tax equivalent basis was $4.0 million, a $60 thousand or 1.5% increase over the $3.9 million net interest income reported for first quarter 2010.  Other income reported for the first quarter 2011 totaled $761 thousand, a $30 thousand or 4.1% increase over the $731 thousand reported for first quarter 2010.

Non-interest expense amounted to $3.1 million during the quarter, an increase of $80 thousand or 2.6% from first quarter 2010.   

The Company’s first quarter efficiency ratio was 65.3% as compared to 64.8% for the same quarter in the prior year.   

Federal income tax provision was $399 thousand for first quarter 2011, compared to $315 thousand for the same quarter in 2010. The quarterly provisions reflect effective tax rates of 30.8% and 29.9%, respectively. 

Total assets amounted to $445 million on March 31, 2011, down $12 million or 2.6% from December 31, 2010.  Loans increased to $322 million, up $6.4 million or 2.0% from the prior year-end, while securities balances of $89 million were up $7.9 million or 9.8% from the prior year-end. 

Average total assets during the quarter amounted to $452 million, an increase of $7 million or 1.5% above the same quarter of the prior year.  Average loan balances of $320 million increased $7.9 million from the prior year first quarter, and average securities balances of $86 million increased $6.2 million or 7.9% as compared to first quarter 2010.

Average commercial loan balances for the quarter, including commercial real estate, increased $13 million or 6.8% above year ago levels.  Average residential mortgage balances declined by $7 million or 8.2% during the year.  The decline in portfolio mortgage balances was primarily a result of customers selecting secondary market products due to historically low 15 to 30 year fixed rates.  Average home equity balances increased $2 million or 6.1%, and average consumer credit balances declined $0.5 million or 6.3% versus the same quarter of the prior year.

Net charge-offs for the quarter totaled $283 thousand as compared to $223 thousand for first quarter 2010.  Net charge-offs equated to 0.36% of average loans during the first quarter 2011 as compared to 0.29% for the prior year’s first quarter.

Nonperforming assets totaled $3.9 million or 1.22% of total loans plus other real estate at March 31, 2011, compared to $6.5 million or 2.09% at March 31, 2010.  Delinquent loan balances as of March 31, 2011 amounted to 1.87% of total loans as compared to 2.48% at March 31, 2010. 

The Company funded $280 thousand in loan loss provision during the first quarter and the allowance for loan losses amounted to 1.25% of total loans on March 31, 2011.  The ratio of the allowance for loan losses to nonperforming loans stood at 103% on March 31, 2011 as compared to 88% and 70% at December 31, and March 31, 2010, respectively.  

Commenting on the Company’s credit quality, Steiner noted, “Our ratio of nonperforming assets declined from December 31, 2010, and early stage delinquencies have shown modest improvement in recent months. However, we continue to expect total delinquencies and nonperforming assets to remain somewhat elevated for the foreseeable future.”

Average deposit balances grew by $3.6 million during the first quarter, or 1.0%.  Total average deposits of $350 million for the quarter were 6.9% above the prior year’s first quarter average. 

Deposit balances totaled $348 million at quarter-end, a decrease of $5 million or 1.5% during the quarter and an increase of $22 million or 6.8% from the prior year’s first quarter.  Average noninterest-bearing account balances decreased $2 million, or 3.2% during the quarter and increased $12.8 million or 24.4% from the same period in the prior year.  Average interest-bearing checking, money market and traditional savings balances increased $7 million or 5.1% during the quarter and increased $9 million or 6.9% from the same period in the prior year.  Average time deposit balances decreased $.8 million or .5% during the quarter and increased $1.2 million or .8% from first quarter 2010. 

The average balance of securities sold under repurchase agreement during the first quarter grew by $2 million or 8.1% above the average for the same period in the prior year.  These repurchase agreements, while considered short-term borrowings, are primarily tied to overnight customer sweep accounts.  Average advances from the Federal Home Loan Bank (“FHLB”) decreased $19 million or 46.1% from the prior year’s quarter as maturing borrowings have been paid down, funded by reducing average balances of Fed funds sold and interest bearing deposits with other banks.

Shareholders’ equity totaled $47.5 million on March 31, 2011 with 2.7 million common shares outstanding at year-end.  The Company’s capital position remains strong, with tangible equity to assets approximating 10.2% on March 31, 2011, compared to 9.9% on December 31, 2010.  The Company declared a common dividend of $.18 per share during the quarter.  Based on the March 31, 2011 closing stock price of $15.20 per share, the Company’s annual dividend yield approximates 4.7%.

About CSB Bancorp, Inc.
CSB is a financial holding company headquartered in Millersburg, Ohio, with approximate assets of $445 million as of March 31, 2011.  CSB provides a complete range of banking and other financial services to consumers and businesses through its wholly owned subsidiary, The Commercial & 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


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