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Press Release | April 22, 2013
CSB BANCORP, INC. REPORTS FIRST QUARTER EARNINGS
First Quarter Highlights
Quarter Ended Quarter Ended
March 31, 2013 March 31, 2012
Diluted earnings per share $0.50 $0.39
Net Income $1,362,000 $1,055,000
Return on average common equity 10.43% 8.46%
Return on average assets 0.96% 0.77%
Millersburg, Ohio – April 22, 2013 – CSB Bancorp, Inc. (CSBB) today announced first quarter 2013 net income of $1.36 million or $.50 per basic and diluted share, as compared to $1.06 million or $.39 per basic and diluted share for the same period in 2012.
Annualized returns on average common equity (“ROE”) and average assets (“ROA”) for the quarter were 10.43% and 0.96%, respectively, compared with 8.46% and 0.77% for the first quarter of 2012.
Eddie Steiner, President and CEO commented, “We continue to focus on growing relationships with current and new customers. The bank’s average loan balances have increased 14% in the past year, and although margins are very tight, this growth has provided increases of approximately 9% in both net interest income and non-interest income as compared to year ago levels.”
Revenue totaled $5.8 million in the first quarter, a 9% increase from the prior-year first quarter. Non-interest expense amounted to $3.6 million during the quarter, an increase of $15 thousand or 0.4% from the same quarter in the prior year. The Company’s first quarter efficiency ratio amounted to 60.7% as compared to 65.9% for the same quarter in the prior year.
Federal income tax provision was $0.6 million for the quarter, compared to $0.5 million for the same quarter in 2012. The $1.36 million net income was 29% higher than net income recorded during the first quarter of the prior year.
Average total assets during the quarter amounted to $576 million, an increase of $24 million or 4% above the same quarter of the prior year. Average loan balances of $373 million were $46 million or 14% above prior year first quarter, while average securities balances of $136 million increased $9 million or 7% as compared to first quarter 2012.
Total assets amounted to $569 million on March 31, 2013, up $8 million or 1% from March 31, 2012. Net loan balances at quarter end totaled $369 million, up $41 million or 13% from the year-ago quarter, while securities balances of $137 million were $9 million or 7% higher than year ago balances. On a linked-quarter basis, net loans grew by $9 million and securities balances grew by $3 million.
Average commercial loan balances, including commercial real estate, grew by $14 million or 6% during the quarter ended March 31, 2013. Average residential mortgage balances increased by $4 million or 5% during the first quarter, as the bank continues to originate and retain some 15 year fixed rate mortgages. Average home equity balances declined $1 million or 2% during the quarter. There were no significant changes in the remainder of the bank’s loan portfolio, which includes installment, credit card and other loan balances totaling less than $10 million in outstanding balances.
The bank recorded a modest net recovery of loan charge-offs totaling $14 thousand for the quarter.
Nonperforming assets totaled $2.2 million or 0.59% of total loans plus other real estate at quarter end, compared to $3.3 million or 0.99% at the end of the first quarter in the prior year. Delinquent loan balances amounted to 1.00% of total loans on March 31, 2013, down from 1.57% in March 2012. During the quarter, the Company received a full payoff on one nonperforming commercial relationship, resulting in a $180 thousand recovery of interest and late charges, and reducing nonperforming asset balances by $1.1 million.
The Company funded $210 thousand in loan loss provision during the first quarter and the allowance for loan losses amounted to 1.29% of total loans on March 31, 2013. The ratio of the allowance for loan losses to nonperforming loans stood at 220% at the end of the quarter.
Commenting on the Company’s credit quality, Steiner noted that the Company’s nonperforming asset balances have demonstrated a general pattern of improvement for the past three years.
Deposit balances totaled $458 million on March 31, 2013, an increase of $7 million or 2% from the prior year quarter. Deposit balances at quarter-end were $18 million lower than December 31, 2012, as a run up in deposit balances occurred during the last two weeks of December and gradually dissipated during the first quarter of 2013.
Average total deposits during the quarter of $463 million were 5% above the prior year’s first quarter average, while declining by $0.8 million or 0.2% from the immediate prior quarter.
Within the deposit category, average non-interest-bearing account balances declined $2 million, or 3% during the quarter. Average interest-bearing checking, money market and traditional savings balances increased $4 million or 2% during the quarter, while average time deposit balances decreased $2 million or 1% during the quarter. In addition to the changes in average deposit balances, the average balance of securities sold under repurchase agreement during the first quarter grew by $3 million or 8% during the quarter and were 16% above the average for the same period in the prior year. The Company’s repurchase agreements, while considered short-term borrowings, are primarily tied to overnight customer sweep accounts.
Shareholders’ equity totaled $52.8 million on March 31, 2013 with 2.7 million common shares outstanding. The tangible equity to assets ratio amounted to 8.4% on March 31, 2013, as compared to 8.0% on March 31, 2012. The Company declared a common dividend of $.18 per share during the quarter. Based on the March 31, 2013 closing stock price of $19.20 per share, the Company’s annual dividend yield approximates 3.75%.
About CSB Bancorp, Inc.
CSB is a financial holding company headquartered in Millersburg, Ohio, with approximate assets of $569 million as of March 31, 2013. 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.
Paula J. Meiler, SVP & CFO