News at the bell
CIB Marine Bancshares, Inc. Announces 2016 Third Quarter Results
WAUKESHA, WI -- (Marketwired) -- 10/13/16 -- CIB Marine Bancshares, Inc. (the "Company" or "CIBM") (OTCQB: CIBH), the holding company of CIBM Bank, announced its results of operations and financial condition for the third quarter of 2016. Net income for the quarter was $0.9 million or $0.05 basic earnings per share, and for the nine months ending September 30, 2016, $3.0 million or $0.17 per share. Earnings per share on a diluted basis for the same quarter and nine month period were $0.02 and $0.08, respectively. This reflects a substantial increase over the prior year's results for the same periods as shown in the included financial information.
Select highlights for the quarter include:
Return on average assets was 0.55% for the third quarter of 2016 and 0.67% for the nine months ending September 30, 2016, showing a substantial improvement over the 0.23% and 0.05% reported for the same periods in 2015.
Net income for subsidiary CIBM Bank was $1.0 million for the third quarter and $3.1 million for the nine months ending September 30, 2016; compared to $0.6 million and $0.9 million for the same periods of 2015.
The growing and diversified loan portfolio has been the main driver of CIBM's net interest income growth as it has increased $0.5 million for the third quarter and $1.5 million for the nine months ending September 30, 2016, relative to the same periods of 2015.
Non-interest income increased $1.6 million for the third quarter and $3.7 million for the nine months ending September 30, 2016, relative to the same periods of 2015, due primarily to mortgage activity.
In addition to the growing revenues, our expense management activities discussed in prior earnings releases and shareholder letters have played a role in this outcome as well. The primary source of noninterest expense growth has been from higher commissions related to mortgage production.
Although net recoveries from prior charge-offs annualized to average loans has been fairly strong this past quarter and year to date, the approximately $1.3 million (net of costs) structured settlement payment announced earlier this year has not yet been received or recorded.
Non-performing assets to total assets continued its decline to 1.32% from 1.59% the prior quarter, 2.25% at the year-end 2015, and 2.20% at the same quarter-end of 2015.
"CIB Marine is pleased to be reporting year-on-year earnings improvements, continued growth in revenues and key accomplishments in executing some expense reductions," said Mr. J. Brian Chaffin, President and Chief Executive Officer of CIB Marine Bancshares, Inc. "Our third quarter saw growth in all of our key production units with especially strong results coming out of our mortgage banking division. In addition, we have received our first full quarter's results from the SBA financing facility discussed in the prior quarter, this facility is reported under reverse repurchase agreements in the balance sheet and other investments in the income statement."
Mr. Chaffin added, "We continue to focus on fulfilling our mission and growing our client relationship-based banking businesses along our corporate, mortgage and retail lines. We have made several new hires in our retail banking division recently, and Joe Arie joined our management team in the third quarter to develop our SBA lending business. Joe has a long history in SBA lending management and participation in various roles with key SBA trade organizations. In addition, CIBM successfully implemented a new customer relationship management system this past quarter -- this will assist in better meeting our customers' financial service needs and coordinate those efforts internally across our divisions and geographies."
CIB Marine Bancshares, Inc. is the holding company for CIBM Bank, which operates 11 banking offices in Illinois, Wisconsin and Indiana. More information on the Company is available at www.cibmarine.com, including recent shareholder letters, links to regulatory financial reports, and audited financial statements.
Notice that Preferred Dividend has not been declared: Pursuant to Sections 5.4(e)(v) and 5.5(e)(v) of the Company's Articles of Incorporation, notice is hereby given that the Board of Directors of the Company has not declared a dividend on its Series A Preferred Stock or its Series B Convertible Preferred Stock for the quarter ended September 30, 2016, and, accordingly, no dividend will be paid to preferred shareholders for such Dividend Period.
FORWARD-LOOKING STATEMENTS
CIB Marine has made statements in this release that may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. CIB Marine intends these forward-looking statements to be subject to the safe harbor created thereby and is including this statement to avail itself of the safe harbor. Forward-looking statements are identified generally by statements containing words and phrases such as "may," "project," "are confident," "should be," "intend," "predict," "believe," "plan," "expect," "estimate," "anticipate" and similar expressions. These forward-looking statements reflect CIB Marine's current views with respect to future events and financial performance that are subject to many uncertainties and factors relating to CIB Marine's operations and the business environment, which could change at any time.
There are inherent difficulties in predicting factors that may affect the accuracy of forward-looking statements.
Stockholders should note that many factors, some of which are discussed elsewhere in this Earnings Release and in the documents that are incorporated by reference, could affect the future financial results of CIB Marine and could cause those results to differ materially from those expressed in forward-looking statements contained or incorporated by reference in this document. These factors, many of which are beyond CIB Marine's control, include but are not limited to:
operating, legal, and regulatory risks;
economic, political, and competitive forces affecting CIB Marine's banking business;
the impact on net interest income and securities values from changes in monetary policy and general economic and political conditions; and
the risk that CIB Marine's analyses of these risks and forces could be incorrect and/or that the strategies developed to address them could be unsuccessful.
These factors should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on such statements. Forward-looking statements speak only as of the date they are made. CIB Marine undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Forward-looking statements are subject to significant risks and uncertainties and CIB Marine's actual results may differ materially from the results discussed in forward-looking statements.
CIB MARINE BANCSHARES, INC.
Selected Unaudited Consolidated Financial Data
At or for the
Quarters Ended Nine Months Ended
September 30, June 30, March 31, December 31, September 30, September 30, September 30,
2016 2016 2016 2015 2015 2016 2015
(Dollars in thousands, except share and per share data)
Selected Statement of Operations Data
Interest and dividend income $ 5,286 $ 5,214 $ 5,176 $ 4,874 $ 4,657 $ 15,676 $ 13,656
Interest expense 740 729 735 654 595 2,204 1,723
Net interest income 4,546 4,485 4,441 4,220 4,062 13,472 11,933
Provision for (reversal of) loan losses 69 118 61 215 (337 ) 248 (154 )
Net interest income after provision for (reversal of) loan losses 4,477 4,367 4,380 4,005 4,399 13,224 12,087
Noninterest income (1) 2,651 2,788 2,053 592 1,022 7,492 3,834
Noninterest expense 6,220 5,951 5,481 5,386 5,114 17,652 15,731
Income (loss) before income taxes 908 1,204 952 (789 ) 307 3,064 190
Income tax expense 40 15 0 6 0 55 0
Net income (loss) $ 868 $ 1,189 $ 952 $ (795 ) $ 307 $ 3,009 $ 190
Common Share Data
Basic net income (loss) per share $ 0.05 $ 0.07 $ 0.05 $ (0.04 ) $ 0.02 $ 0.17 $ 0.01
Diluted net income (loss) per share 0.02 0.03 0.03 (0.04 ) 0.01 0.08 0.01
Dividend 0 0 0 0 0 0 0
Tangible book value per share (2) 1.04 0.99 0.90 0.79 0.90 1.04 0.90
Book value per share (2) 0.56 0.51 0.41 0.31 0.42 0.56 0.42
Weighted average shares outstanding - basic 18,127,892 18,127,892 18,17,892 18,127,892 18,127,92 18,127,892 18,127,892
Weighted average shares outstanding - diluted 35,818,022 35,631,892 35,631,892 18,127,892 35,631,892 35,694,388 35,631,892
Financial Condition Data
Total assets $ 632,628 $ 615,708 $ 597,089 $ 571,233 $ 531,744 $ 632,628 $ 531,744
Loans 466,057 461,859 470,424 445,050 414,643 466,057 414,643
Allowance for loan losses (8,549 ) (8,219 ) (8,235 ) (8,064 ) (7,883 ) (8,549 ) (7,883 )
Investment securities 103,853 103,542 97,474 94,702 92,674 103,853 92,674
Deposits 476,428 468,377 467,334 443,571 415,185 476,428 415,185
Borrowings 81,636 72,833 57,929 58,883 45,396 81,636 45,396
Stockholders' equity 70,094 69,266 67,475 65,586 67,616 70,094 67,616
Financial Ratios and Other Data
Performance Ratios:
Net interest margin (3) 2.95 % 3.11 % 3.15 % 3.14 % 3.18 % 3.07 % 3.19 %
Net interest spread (4) 2.80 % 2.96 % 3.00 % 2.98 % 3.03 % 2.92 % 3.04 %
Noninterest income to average assets (5) 1.68 % 1.88 % 1.42 % 0.43 % 0.77 % 1.66 % 0.99 %
Noninterest expense to average assets 3.93 % 4.02 % 3.78 % 3.89 % 3.87 % 3.91 % 4.07 %
Efficiency ratio (6) 86.42 % 81.82 % 84.40 % 111.93 % 100.59 % 84.20 % 99.85 %
Earnings (loss) on average assets (7) 0.55 % 0.80 % 0.66 % -0.57 % 0.23 % 0.67 % 0.05 %
Earnings (loss) on average equity (8) 4.89 % 6.98 % 5.75 % -4.65 % 1.79 % 5.86 % 0.37 %
Asset Quality Ratios:
Nonaccrual loans to loans (9) 1.16 % 0.81 % 0.81 % 0.70 % 0.75 % 1.16 % 0.75 %
Nonaccrual loans, restructured loans and loans 90 days or more past due and still accruing to total loans (9) 1.58 % 1.63 % 1.64 % 1.96 % 1.68 % 1.58 % 1.68 %
Nonperforming assets, restructured loans and loans 90 days or more past due and still accruing to total assets (9) 1.32 % 1.59 % 1.94 % 2.25 % 2.20 % 1.32 % 2.20 %
Allowance for loan losses to total loans 1.83 % 1.78 % 1.75 % 1.81 % 1.90 % 1.83 % 1.90 %
Allowance for loan losses to nonaccrual loans, restructured loans and loans 90 days or more past due and still accruing (9) 116.08 % 109.14 % 106.74 % 92.25 % 113.03 % 116.08 % 113.03 %
Net charge-offs (recoveries) annualized to average loans -0.22 % 0.12 % -0.10 % 0.03 % -0.54 % -0.07 % -0.16 %
Capital Ratios:
Total equity to total assets 11.08 % 11.25 % 11.30 % 11.48 % 12.72 % 11.08 % 12.72 %
Total risk-based capital ratio 15.66 % 15.60 % 15.19 % 15.45 % 16.57 % 15.66 % 16.57 %
Tier 1 risk-based capital ratio 14.41 % 14.34 % 13.93 % 14.20 % 15.31 % 14.41 % 15.31 %
Leverage capital ratio 11.20 % 11.69 % 11.72 % 12.27 % 13.01 % 11.20 % 13.01 %
Other Data:
Number of employees (full-time equivalent) 169 167 180 173 159 169 159
Number of banking facilities 11 11 11 11 11 11 11
(1) Noninterest income includes gains and losses on securities.
(2) Tangible book value per share is the shareholder equity less the carry value of the preferred stock and less the goodwill and intangible assets, divided by the total shares of common outstanding. Book value per share is the shareholder equity less the liquidation preference of the preferred stock, divided by the total shares of common outstanding.
(3) Net interest margin is the ratio of net interest income to average interest-earning assets.
(4) Net interest spread is the yield on average interest-earning assets less the rate on average interest-bearing liabilities.
(5) Noninterest income to average assets excludes gains and losses on securities.
(6) The efficiency ratio is noninterest expense divided by the sum of net interest income plus noninterest income, excluding gains and losses on securities.
(7) Earnings on average assets are net income divided by average total assets.
(8) Earnings on average equity are net income divided by average common equity.
(9) Excludes loans held for sale.
CIB MARINE BANCSHARES, INC.
Consolidated Balance Sheets (unaudited)
September 30, June 30, March 31, December 31, September 30,
2016 2016 2016 2015 2015
(Dollars in thousands, except share data)
Assets
Cash and due from banks $ 11,427 $ 9,808 $ 9,136 $ 9,170 $ 8,037
Reverse repurchase agreements 27,560 20,313 - - -
Securities available for sale 103,853 103,542 97,474 94,702 92,674
Loans held for sale 15,875 11,602 10,176 12,275 5,157
Loans 466,057 461,859 470,424 445,050 414,643
Allowance for loan losses (8,549 ) (8,219 ) (8,235 ) (8,064 ) (7,883 )
Net loans 457,508 453,640 462,189 436,986 406,760
Federal Home Loan Bank Stock 3,803 2,170 2,170 2,170 2,170
Premises and equipment, net 4,256 4,358 4,716 4,771 4,830
Accrued interest receivable 1,289 1,290 1,468 1,296 1,471
Other real estate owned, net 982 2,283 3,859 4,126 4,698
Bank owned life insurance 4,363 4,336 4,310 4,285 4,259
Goodwill and other intangible assets 226 232 237 243 248
Other assets 1,486 2,134 1,354 1,209 1,440
Total Assets $ 632,628 $ 615,708 $ 597,089 $ 571,233 $ 531,744
Liabilities and Stockholders' Equity
Deposits:
Noninterest-bearing demand $ 87,216 $ 82,460 $ 74,564 $ 77,580 $ 70,644
Interest-bearing demand 29,821 31,508 32,096 33,192 30,320
Savings 169,390 175,955 175,576 162,663 153,134
Time 190,001 178,454 185,098 170,136 161,087
Total deposits 476,428 468,377 467,334 443,571 415,185
Short-term borrowings 81,636 72,833 57,929 58,883 45,396
Accrued interest payable 319 335 339 321 305
Other liabilities 4,151 4,897 4,012 2,872 3,242
Total liabilities 562,534 546,442 529,614 505,647 464,128
Stockholders' Equity
Preferred stock, $1 par value; 5,000,000 authorized shares; 7% fixed rate noncumulative perpetual issued-55,624 shares of series A and 4,376 shares of series B; convertible; aggregate liquidation preference- $60,000 51,000 51,000 51,000 51,000 51,000
Common stock, $1 par value; 50,000,000 authorized shares; 18,346,391 issued shares; 18,135,344 outstanding shares 18,346 18,346 18,346 18,346 18,346
Capital surplus 158,510 158,493 158,493 158,493 158,493
Accumulated deficit (156,579 ) (157,446 ) (158,636 ) (159,588 ) (158,793 )
Accumulated other comprehensive loss, net (654 ) (598 ) (1,199 ) (2,136 ) (901 )
Treasury stock 218,499 shares at cost (529 ) (529 ) (529 ) (529 ) (529 )
Total stockholders' equity 70,094 69,266 67,475 65,586 67,616
Total liabilities and stockholders' equity $ 632,628 $ 615,708 $ 597,089 $ 571,233 $ 531,744
CIB MARINE BANCSHARES, INC.
Consolidated Statements of Operations (Unaudited)
At or for the
Quarters Ended Nine Months Ended
September 30, June 30, March 31, December 31, September 30, September 30, September 30,
2016 2016 2016 2015 2015 2016 2015
(Dollars in thousands)
Interest Income
Loans $ 4,540 $ 4,635 $ 4,572 $ 4,248 $ 4,044 $ 13,747 $ 11,724
Loans held for sale 153 95 83 77 58 331 264
Securities 513 478 517 546 553 1,508 1,660
Other investments 80 6 4 3 2 90 8
Total interest income 5,286 5,214 5,176 4,874 4,657 15,676 13,656
Interest Expense
Deposits 659 692 705 640 583 2,056 1,687
Short-term borrowings 81 37 30 14 12 148 36
Total interest expense 740 729 735 654 595 2,204 1,723
Net interest income 4,546 4,485 4,441 4,220 4,062 13,472 11,933
Provision for (reversal of) loan losses 69 118 61 215 (337 ) 248 (154 )
Net interest income after provision for (reversal of) loan losses 4,477 4,367 4,380 4,005 4,399 13,224 12,087
Noninterest Income
Deposit service charges 125 121 103 113 119 349 337
Other service fees 47 52 67 60 73 166 176
Mortgage Banking revenue, net 2,285 2,102 1,336 545 805 5,723 3,179
Other income 206 96 117 104 102 419 340
Net gains on sale of securities 0 0 0 0 0 0 13
Net gains (losses) on sale of assets and (writedowns) (12 ) 417 430 (230 ) (77 ) 835 (211 )
Total noninterest income 2,651 2,788 2,053 592 1,022 7,492 3,834
Noninterest Expense
Compensation and employee benefits 4,426 4,143 3,624 3,419 3,195 12,193 10,096
Equipment 277 293 273 277 262 843 791
Occupancy and premises 377 389 435 396 404 1,201 1,180
Data Processing 185 151 154 158 173 490 463
Federal deposit insurance 105 106 106 104 110 317 321
Professional services 157 213 249 228 277 619 714
Telephone and data communication 92 99 109 113 86 300 298
Insurance 60 56 54 53 55 170 168
Other expense 541 501 477 638 552 1,519 1,700
Total noninterest expense 6,220 5,951 5,481 5,386 5,114 17,652 15,731
Income (loss) from operations before income taxes 908 1,204 952 (789 ) 307 3,064 190
Income tax expense 40 15 0 6 0 55 0
Net income (loss) 868 1,189 952 (795 ) 307 3,009 190
Preferred stock dividend 0 0 0 0 0 0 0
Net income (loss) allocated to common stockholders $ 868 $ 1,189 $ 952 $ (795 ) $ 307 $ 3,009 $ 190
FOR INFORMATION CONTACT:
J. Brian Chaffin
President & CEO
(217) 355-0900
brian.chaffin@cibmbank.com
Source: CIB Marine Bancshares, Inc.
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