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CIB Marine Bancshares, Inc. Announces 2017 Third Quarter Results

WAUKESHA, Wis., Oct. 10, 2017 (GLOBE NEWSWIRE) -- CIB Marine Bancshares, Inc. (the “Company” or “CIBM”) (OTCQB:CIBH), the holding company of CIBM Bank (the “Bank”), today announces its results of operations and financial condition for the third quarter of 2017. Net income for the quarter was $1.1 million, or $0.06 basic earnings per share and $0.03 diluted earnings per share, and for the nine months ending September 30, 2017, $3.0 million, or $0.17 basic and $0.08 diluted earnings per share.

A summary of financial results for the quarter is attached. Select highlights include:

  • Return on average assets was 0.69% for the quarter and 0.63% for the nine months ending September 30, 2017, compared to 0.55% and 0.67% for the same periods in 2016.
  • Book and tangible book value per share of common stock improved to $0.75 and $1.23, respectively, for September 30, 2017, compared to $0.56 and $1.04 from one year prior.
  • Net income for subsidiary CIBM Bank was $1.3 million for the quarter and $3.6 million for the nine month period ending September 30, 2017, compared to net income of $1.0 million and $3.1 million for the same periods of 2016; reflecting improved performance.
  • Net interest income of $4.9 million for the quarter is an increase of $0.4 million from the same quarter of 2016, and net interest income of $14.3 million for the nine months ending September 30, 2017, is an increase of $0.9 million from the same period of 2016. The growth primarily reflects $40 million of higher average interest-earning asset balances in 2017.
  • Noninterest income of $2.3 million for the quarter is a decrease of $0.4 million from the same quarter of 2016 and noninterest income of $6.7 million for the nine months ending September 30, 2017, is a decrease of $0.8 million from the same period of 2016. The results primarily reflect lower net mortgage banking revenue this year due to reduced refinancing activity.
  • In addition, during 2017, year to date noninterest income reflects gains on sale of SBA loans at $0.8 million compared to $0.1 million during the same period of 2016; and during 2017 year to date net gain on sale of assets and write-downs related to collection activities have been nominal but were $0.9 million in the 2016 year to date period. This reflects improved earnings related to core business activities.
  • Non-performing assets to total assets fell to 1.49% at September 30, 2017, from 1.67% at December 31, 2016, due to lower non-accrual loans.
  • Non-accrual loans to total loans declined to 0.99% at September 30, 2017, from 1.26% at December 31, 2016, due to collection related activity.

J. Brian Chaffin, CIB Marine’s President and CEO, commented, “We are pleased with the positive impact increased earning assets and net interest income have had on our operating results. The growth and development of our SBA lending business has added some additional noninterest income that has more than offset the softer revenues from our residential lending business this year, in part caused by higher interest rates. At the same time, our noninterest expenses year to date are approximately $0.1 million lower than last year.”

Mr. Chaffin added, “One of CIB Marine’s key initiatives in 2017 has been increased involvement in our communities. We have committed substantial resources to support local business and residential housing credit needs through the addition of new programs, products and key staff. We look forward to further growth in this area as we continue to be a force for positive change in the social and economic vitality of the communities we live and work in.”

CIB Marine Bancshares, Inc. is the holding company for CIBM Bank, which operates 11 banking offices in Illinois, Wisconsin, and Indiana and 4 separate mortgage loan 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 period ended September 30, 2017 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,
2017 2017 2017 2016 2016 2017 2016
(Dollars in thousands, except share and per share data)
Selected Statement of Operations Data
Interest and dividend income$6,056 $5,732 $5,562 $5,273 $5,286 $17,350 $15,676
Interest expense 1,140 973 892 793 740 3,005 2,204
Net interest income 4,916 4,759 4,670 4,480 4,546 14,345 13,472
Provision for (reversal of) loan losses 149 47 228 (796) 69 424 248
Net interest income after provision for
(reversal of) loan losses 4,767 4,712 4,442 5,276 4,477 13,921 13,224
Noninterest income (1) 2,257 2,611 1,847 1,908 2,651 6,715 7,492
Noninterest expense 5,865 6,279 5,401 6,127 6,220 17,545 17,652
Income before income taxes 1,159 1,044 888 1,057 908 3,091 3,064
Income tax expense 25 20 0 (5) 40 45 55
Net income$1,134 $1,024 $888 $1,062 $868 $3,046 $3,009
Common Share Data
Basic net income per share$0.06 $0.06 $0.05 $0.06 $0.05 $0.17 $0.17
Diluted net income per share 0.03 0.03 0.02 0.03 0.02 0.08 0.08
Dividend 0 0 0 0 0 0 0
Tangible book value per share (2) 1.23 1.16 1.08 1.01 1.04 1.23 1.04
Book value per share (2) 0.75 0.68 0.60 0.53 0.56 0.75 0.56
Weighted average shares outstanding - basic 18,161,989 18,153,029 18,127,892 18,127,892 18,127,892 18,145,505 18,127,892
Weighted average shares outstanding - diluted 36,512,804 36,516,207 36,193,353 36,082,522 35,818,022 36,407,957 35,694,388
Financial Condition Data
Total assets$640,340 $650,051 $631,160 $653,559 $632,628 $640,340 $632,628
Loans 490,089 488,289 483,501 483,518 466,057 490,089 466,057
Allowance for loan losses (7,905) (7,653) (7,567) (7,592) (8,549) (7,905) (8,549)
Investment securities 112,670 111,160 111,745 112,072 103,853 112,670 103,853
Deposits 479,285 493,364 497,144 483,097 476,428 479,285 476,428
Borrowings 84,903 82,025 60,837 96,944 81,636 84,903 81,636
Stockholders' equity 73,556 72,279 70,819 69,523 70,094 73,556 70,094
Financial Ratios and Other Data
Performance Ratios:
Net interest margin (3) 3.07% 3.09% 3.02% 2.84% 2.95% 3.06% 3.07%
Net interest spread (4) 2.88% 2.92% 2.87% 2.70% 2.80% 2.89% 2.92%
Noninterest income to average assets (5) 1.37% 1.65% 1.16% 1.18% 1.68% 1.39% 1.66%
Noninterest expense to average assets 3.55% 3.96% 3.40% 3.79% 3.93% 3.64% 3.91%
Efficiency ratio (6) 81.76% 85.20% 82.88% 95.91% 86.42% 83.31% 84.20%
Earnings on average assets (7) 0.69% 0.65% 0.56% 0.66% 0.55% 0.63% 0.67%
Earnings on average equity (8) 6.11% 5.71% 5.10% 5.93% 4.89% 5.65% 5.86%
Asset Quality Ratios:
Nonaccrual loans to loans (9) 0.99% 0.99% 1.32% 1.26% 1.16% 0.99% 1.16%
Nonaccrual loans, restructured loans and
loans 90 days or more past due and still
accruing to total loans (9) 1.30% 1.36% 1.65% 1.60% 1.58% 1.30% 1.58%
Nonperforming assets, restructured loans
and loans 90 days or more past due and still
accruing to total assets (9) 1.49% 1.51% 1.77% 1.67% 1.32% 1.49% 1.32%
Allowance for loan losses to total loans 1.61% 1.57% 1.57% 1.57% 1.83% 1.61% 1.83%
Allowance for loan losses to nonaccrual loans,
restructured loans and loans 90 days or
more past due and still accruing (9) 124.21% 72.81% 94.67% 97.99% 116.08% 124.21% 116.08%
Net charge-offs (recoveries) annualized
to average loans -0.08% -0.03% 0.21% 0.14% -0.22% 0.03% -0.07%
Capital Ratios:
Total equity to total assets 11.49% 11.12% 11.02% 10.64% 11.08% 11.49% 11.08%
Total risk-based capital ratio 16.05% 15.93% 15.90% 15.40% 15.69% 16.05% 15.69%
Tier 1 risk-based capital ratio 14.43% 14.68% 14.65% 14.15% 14.43% 14.43% 14.43%
Leverage capital ratio 11.41% 11.56% 11.21% 11.14% 11.20% 11.41% 11.20%
Other Data:
Number of employees (full-time equivalent) 179 181 181 171 169 179 169
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,
2017 2017 2017 2016 2016
(Dollars in thousands, except share data)
Assets
Cash and due from banks$9,569 $10,462 $12,773 $10,291 $11,427
Reverse repurchase agreements 10,289 20,440 11,019 24,275 27,560
Securities available for sale 112,670 111,160 111,745 112,072 103,853
Loans held for sale 7,164 9,166 2,448 11,469 15,875
Loans 490,089 488,289 483,501 483,518 466,057
Allowance for loan losses (7,905) (7,653) (7,567) (7,592) (8,549)
Net loans 482,184 480,636 475,934 475,926 457,508
Federal Home Loan Bank Stock 3,128 2,948 2,070 3,803 3,803
Premises and equipment, net 4,371 4,309 4,369 4,427 4,256
Accrued interest receivable 1,507 1,386 1,377 1,382 1,289
Other real estate owned, net 3,153 3,153 3,153 3,159 982
Bank owned life insurance 4,468 4,441 4,414 4,389 4,363
Goodwill and other intangible assets 204 209 215 221 226
Other assets 1,633 1,741 1,643 2,145 1,486
Total Assets$640,340 $650,051 $631,160 $653,559 $632,628
Liabilities and Stockholders' Equity
Deposits:
Noninterest-bearing demand$72,875 $79,888 $76,088 $77,154 $87,216
Interest-bearing demand 31,756 31,961 33,027 33,832 29,821
Savings 174,174 183,608 192,175 176,435 169,390
Time 200,480 197,907 195,854 195,676 190,001
Total deposits 479,285 493,364 497,144 483,097 476,428
Short-term borrowings 84,903 82,025 60,837 96,944 81,636
Accrued interest payable 404 358 327 349 319
Other liabilities 2,192 2,025 2,033 3,646 4,151
Total liabilities 566,784 577,772 560,341 584,036 562,534
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; 18,383,891 issued shares; 18,172,844 outstanding shares 18,384 18,384 18,346 18,346 18,346
Capital surplus 158,713 158,640 158,602 158,552 158,510
Accumulated deficit (152,471) (153,605) (154,629) (155,517) (156,579)
Accumulated other comprehensive loss, net (1,537) (1,611) (1,971) (2,329) (654)
Treasury stock 221,902 shares at cost (533) (529) (529) (529) (529)
Total stockholders' equity 73,556 72,279 70,819 69,523 70,094
Total liabilities and stockholders' equity$640,340 $650,051 $631,160 $653,559 $632,628


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,
2017 2017 2017 2016 2016 2017 2016
(Dollars in thousands)
Interest Income
Loans$5,188$4,997$4,826$4,493 $4,540 $15,011$13,747
Loans held for sale 104 79 46 141 153 229 331
Securities 640 598 611 563 513 1,849 1,508
Other investments 124 58 79 76 80 261 90
Total interest income 6,056 5,732 5,562 5,273 5,286 17,350 15,676
Interest Expense
Deposits 871 817 749 697 659 2,437 2,056
Short-term borrowings 269 156 143 96 81 568 148
Total interest expense 1,140 973 892 793 740 3,005 2,204
Net interest income 4,916 4,759 4,670 4,480 4,546 14,345 13,472
Provision for (reversal of) loan losses 149 47 228 (796) 69 424 248
Net interest income after provision for
(reversal of) loan losses 4,767 4,712 4,442 5,276 4,477 13,921 13,224
Noninterest Income
Deposit service charges 132 129 113 121 125 374 349
Other service fees 45 54 46 45 47 145 166
Mortgage Banking revenue, net 1,821 2,027 1,142 1,414 2,285 4,990 5,723
Other income 127 127 97 136 206 351 419
Net gains on sale of securities 0 0 0 0 0 0 0
Net gains (losses) on sale of assets
and (writedowns) 132 274 449 192 (12) 855 835
Total noninterest income 2,257 2,611 1,847 1,908 2,651 6,715 7,492
Noninterest Expense
Compensation and employee benefits 4,099 4,333 3,705 4,228 4,426 12,137 12,193
Equipment 320 319 290 305 277 929 843
Occupancy and premises 386 381 390 390 377 1,157 1,201
Data Processing 168 136 140 123 185 444 490
Federal deposit insurance 55 81 87 92 105 223 317
Professional services 158 130 200 156 157 488 619
Telephone and data communication 87 88 81 90 92 256 300
Insurance 60 96 59 60 60 215 170
Other expense 532 715 449 683 541 1,696 1,519
Total noninterest expense 5,865 6,279 5,401 6,127 6,220 17,545 17,652
Income from operations
before income taxes 1,159 1,044 888 1,057 908 3,091 3,064
Income tax expense 25 20 0 (5) 40 45 55
Net income 1,134 1,024 888 1,062 868 3,046 3,009
Preferred stock dividend 0 0 0 0 0 0 0
Net income allocated to
common stockholders$1,134$1,024$888$1,062 $868 $3,046$3,009


FOR INFORMATION CONTACT: J. Brian Chaffin, President & CEO (217) 355-0900 brian.chaffin@cibmbank.com

Source:CIBM Bank