BROOKFIELD, Wis., July 19, 2019 (GLOBE NEWSWIRE) -- CIB Marine Bancshares, Inc. (the “Company” or “CIBM”) (OTCQB: CIBH), the holding company of CIBM Bank, announced its unaudited results of operations and financial condition for the second quarter of 2019.  Income before taxes for the quarter was $1.0 million compared to $1.1 million for the same period in 2018, and for the six months ending June 30, 2019, it was $1.9 million compared to $2.0 million for the same period in 2018.

A summary of financial results for the quarter and six months ended June 30, 2019, is attached.  Select highlights include:

  • Tangible book value per share and stated book value per share at June 30, 2019, were $2.97 and $2.60 per share of common stock, respectively, compared to $2.82 and $2.45, respectively, at December 31, 2018.  The increase reflects reported income for the six months ended June 30, 2019, and improved net accumulated other comprehensive income (loss) due to improved available for sale security values as a result of lower market interest rates. 
  • Income before taxes for subsidiary CIBM Bank was $1.2 million for the quarter compared to $1.4 million for the same period in 2018, and $2.0 million for the six months ending June 30, 2019, compared to $2.5 million for the same period in 2018.  Comparing the two six month periods, there was a decline in net interest income of $0.2 million due primarily to rising cost of funds, and a decline in non-interest income of $0.9 million due to lower net mortgage banking revenues and SBA gains on sale as a result of lower origination volumes.  This was offset, in part, by lower non-interest expenses of $0.4 million and a $0.2 million improvement in provisions to loan losses.
  • Non-performing assets, restructured loans, and loans 90 days or more past due and still accruing to total assets was 1.40% at June 30, 2019, versus 1.45% at December 31, 2018, and 0.94% at June 30, 2018. The increase from one year ago is primarily the result of one loan placed on non-accrual during the fourth quarter of 2018.  CIB Marine’s allowance for loan losses was 1.41% at June 30, 2019, versus 1.62% at December 31, 2018, and 1.65% at June 30, 2018.  The decline was primarily due to a $0.5 million charge-off of a loan that was previously reserved for.      

Mr. J. Brian Chaffin, President and CEO of CIBM, commented, “Our mortgage division increased mortgage loan closings by $47 million in the second quarter versus the first quarter of 2019 and net mortgage banking revenue increased by $1.2 million over the same period.  The improvements are attributable to a number of factors including seasonality, the division’s success in purchase money lending activity, a number of new hires, and lower interest rates.  At the same time, our loan portfolio grew by $24 million during the quarter with contributions from all major portfolio segments, including commercial, residential, and home equity lines of credit.  Our SBA loan originations continue to be softer than the prior year with our gains on sale year to date totaling $0.3 million compared to $0.7 million for the same period last year, but there is a significant pipeline developed that we expect to support higher originations and gains on sale in the quarters ahead.”

He added, “Our rising trend in cost of funds has slowed due to a number of factors, including slower total balance sheet growth in the industry and market pricing for lower future short- and mid-term interest rates.  However, it continues to have an adverse effect on our net interest income growth and our net interest margin, which reported at 2.89% for the second quarter of 2019, down from 2.94% in the first quarter.       

“Lastly, we concluded the offering period of the second of three planned preferred stock modified Dutch auctions in June of 2019.  Of the approximately 29,475 shares of preferred stock offered for sale, approximately 2,229 shares met the criteria for repurchase laid out by the Board of Directors of CIBM and are anticipated to be accepted by CIBM for a total price of $1.6 million, pending necessary regulatory approvals.  It is contemplated a discount of $0.3 million to the carrying value of preferred stock shares will be transferred to paid-in capital upon acceptance by CIBM of these offered shares.  CIBM plans to settle the transactions from cash and no additional capital has been or is contemplated to be issued to provide funding for the purchases.  As a reminder, a $3.5 million liability currently exists for the purchase of 4,923 preferred shares, which will settle on or before December 1, 2019, as agreed to in 2018.”

CIB Marine Bancshares, Inc. is the holding company for CIBM Bank, which operates eleven banking offices and five 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.

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, execution, credit, market, security (including cyber), 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.

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


CIB MARINE BANCSHARES, INC.
Selected Unaudited Consolidated Financial Data
         
 At or for the 
 Quarters Ended 6 Months Ended
  June 30,  March 31,  December 31,  September 30,  June 30,   June 30,   June 30,  
  2019  2019  2018  2018  2018   2019  2018 
  
 (Dollars in thousands, except share and per share data)
Selected Statement of Operations Data        
Interest and dividend income$  7,078 $  7,015 $  7,009 $  6,798 $  6,387  $  14,093 $  12,396 
Interest expense 2,256  2,178  2,064  1,767  1,406   4,434  2,591 
Net interest income 4,822  4,837  4,945  5,031  4,981   9,659  9,805 
Provision for (reversal of) loan losses (67) (158) (1,195) (13) 149   (225) 23 
Net interest income after provision for        
(reversal of) loan losses 4,889  4,995  6,140  5,044  4,832   9,884  9,782 
Noninterest income (1) 2,710  1,362  1,546  3,063  2,968   4,072  4,800 
Noninterest expense 6,557  5,505  6,415  6,871  6,737   12,062  12,561 
Income before income taxes 1,042  852  1,271  1,236  1,063   1,894  2,021 
Income tax expense 281  229  313  345  241   510  530 
Net income $  761 $  623 $  958 $  891 $  822  $  1,384 $  1,491 
         
Common Share Data        
Basic net income per share (2)$  0.04 $  0.03 $  0.05 $  0.14 $  0.05  $  0.08 $  0.09 
Diluted net income per share (2) 0.02  0.02  0.03  0.07  0.02   0.04  0.04 
Dividend 0.00  0.00  0.00  0.00  0.00   0.00  0.00 
Tangible book value per share (3) 2.97  2.90  2.82  2.71  2.58   2.97  2.58 
Book value per share (3) 2.60  2.53  2.45  2.34  2.10   2.60  2.10 
Weighted average shares outstanding - basic 18,290,674  18,232,169  18,232,169  18,232,169  18,209,032   18,261,584  18,185,641 
Weighted average shares outstanding - diluted 33,009,983  32,815,744  32,757,855  34,589,375  36,783,724   32,950,273  36,664,538 
Financial Condition Data        
Total assets$  708,270 $  702,152 $  721,259 $  723,733 $  694,812  $  708,270 $  694,812 
Loans 513,755  489,273  491,337  507,677  488,762   513,755  488,762 
Allowance for loan losses (7,251) (7,865) (7,947) (8,217) (8,055)  (7,251) (8,055)
Investment securities 124,784  123,500  121,281  118,345  119,571   124,784  119,571 
Deposits 535,367  542,938  536,931  523,729  517,452   535,367  517,452 
Borrowings 69,174  57,220  86,710  104,357  76,427   69,174  76,427 
Stockholders' equity 94,035  92,507  91,035  88,993  97,313   94,035  97,313 
Financial Ratios and Other Data        
Performance Ratios:        
Net interest margin (4) 2.89% 2.94% 2.89% 2.97% 3.15%  2.92% 3.18%
Net interest spread (5) 2.58% 2.64% 2.62% 2.72% 2.92%  2.62% 2.96%
Noninterest income to average assets (6) 1.52% 0.76% 0.84% 1.72% 1.77%  1.14% 1.47%
Noninterest expense to average assets 3.72% 3.14% 3.54% 3.82% 3.99%  3.44% 3.82%
Efficiency ratio (7) 87.45% 89.24% 99.18% 84.63% 84.56%  88.26% 85.80%
Earnings on average assets (8) 0.43% 0.36% 0.53% 0.50% 0.49%  0.39% 0.45%
Earnings on average equity (9) 3.28% 2.76% 4.23% 3.77% 3.36%  3.03% 3.07%
Asset Quality Ratios:        
Nonaccrual loans to loans (10) 1.12% 1.29% 1.34% 0.73% 0.53%  1.12% 0.53%
Nonaccrual loans, restructured loans and         
 loans 90 days or more past due and still        
 accruing to total loans (10) 1.45% 1.66% 1.62% 1.09% 0.82%  1.45% 0.82%
Nonperforming assets, restructured loans         
and loans 90 days or more past due and still        
accruing to total assets (10) 1.40% 1.51% 1.45% 1.11% 0.94%  1.40% 0.94%
Allowance for loan losses to total loans (10) 1.41% 1.61% 1.62% 1.62% 1.65%  1.41% 1.65%
Allowance for loan losses to nonaccrual loans,         
restructured loans and loans 90 days or         
more past due and still accruing (10) 97.34% 96.96% 99.72% 148.99% 200.97%  97.34% 200.97%
Net charge-offs (recoveries) annualized         
to average loans (10) 0.44% (0.06%) (0.74%) (0.14%) (0.48%)  0.19% -0.14%
Capital Ratios:        
Total equity to total assets 13.28% 13.17% 12.62% 12.30% 14.01%  13.28% 14.01%
Total risk-based capital ratio 15.32% 15.56% 15.34% 14.43% 16.40%  15.32% 16.40%
Tier 1 risk-based capital ratio 14.07% 14.31% 14.09% 13.18% 15.14%  14.07% 15.14%
Leverage capital ratio 10.64% 10.39% 10.10% 9.90% 11.70%  10.64% 11.70%
Other Data:        
Number of employees (full-time equivalent) 180  177  183  188  184   180  184 
Number of banking facilities 11  11  11  11  11   11  11 
         
(1) Noninterest income includes gains and losses on securities.
(2) Net income available to common stockholders in the calculation of earnings per share for the second and third quarters of 2018 and the six months ended June 30, 2018 includes the difference between the carrying amount less the consideration paid for redeemed preferred stock of $0.1 million, $1.7 million and $0.1 million, respectively.   
(3) Tangible book value per share is the stockholder 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 stockholder equity less the liquidation preference of the preferred stock, divided by the total shares of common outstanding. As presented here, shares of common outstanding excludes unvested Restricted Stock Awards totalling 1,244,105 shares of common stock at June 30, 2019.   
(4) Net interest margin is the ratio of net interest income to average interest-earning assets.   
(5) Net interest spread is the yield on average interest-earning assets less the rate on average interest-bearing liabilities.   
(6) Noninterest income to average assets excludes gains and losses on securities.   
(7) The efficiency ratio is noninterest expense divided by the sum of net interest income plus noninterest income, excluding gains and losses on securities.   
(8) Earnings on average assets are net income divided by average total assets.   
(9) Earnings on average equity are net income divided by average stockholders' equity.   
(10) Excludes loans held for sale.   

 

CIB MARINE BANCSHARES, INC.
Consolidated Balance Sheets (unaudited)
      
  June 30,   March 31,   December 31,   September 30,   June 30,  
  2019  2019  2018  2018  2018 
 (Dollars in Thousands, Except Shares)
Assets     
Cash and due from banks$  8,791 $  8,168 $  13,037 $  10,055 $  9,752 
Reverse repurchase agreements   18,347    42,729    58,662    45,076    28,403 
Securities available for sale   122,365    121,115    118,926    116,013    117,221 
Equity securities at fair value   2,419    2,385    2,355    2,332    2,350 
Loans held for sale   8,450    4,467    4,632    8,145    15,407 
      
Loans    513,755    489,273    491,337    507,677    488,762 
Allowance for loan losses   (7,251)   (7,865)   (7,947)   (8,217)   (8,055)
Net loans   506,504    481,408    483,390    499,460    480,707 
      
Federal Home Loan Bank Stock   2,363    2,003    3,172    3,870    2,610 
Premises and equipment, net (1)   7,386    7,220    4,498    4,409    4,296 
Accrued interest receivable   1,820    1,873    1,570    1,858    1,580 
Deferred tax assets, net   20,703    21,156    21,422    22,410    22,604 
Other real estate owned, net   2,466    2,466    2,486    2,494    2,494 
Bank owned life insurance   4,640    4,613    4,590    4,565    4,541 
Goodwill and other intangible assets   165    171    176    181    187 
Other assets   1,851    2,378    2,343    2,865    2,660 
Total Assets$  708,270 $  702,152 $  721,259 $  723,733 $  694,812 
      
Liabilities and Stockholders' Equity      
Deposits:     
Noninterest-bearing demand$  62,424 $  62,553 $  63,507 $  69,165 $  72,839 
Interest-bearing demand   32,649    32,467    33,660    33,701    32,615 
Savings   192,133    188,110    181,432    164,603    175,343 
Time   248,161    259,808    258,332    256,260    236,655 
Total deposits   535,367    542,938    536,931    523,729    517,452 
Short-term borrowings   69,174    57,220    86,710    104,357    76,427 
Accrued interest payable   725    727    710    694    497 
Other liabilities   8,969    8,760    5,873    5,960    3,123 
Total liabilities   614,235    609,645    630,224    634,740    597,499 
      
Stockholders' Equity      
Preferred stock, $1 par value; 5,000,000     
authorized shares; 7% fixed rate noncumulative perpetual issued; 42,955 shares of series A and 3,380 shares of series B; convertible; aggregate liquidation preference- $46.3 million   39,384    39,384    39,384    39,384    50,107 
Common stock, $1 par value; 75,000,000     
authorized shares; 18,455,610 issued shares; 18,244,563 outstanding shares    18,543    18,456    18,456    18,454    18,454 
Capital surplus   160,991    160,930    160,815    160,716    158,903 
Accumulated deficit   (124,412)   (125,173)   (125,796)   (126,754)   (127,140)
Accumulated other comprehensive income (loss), net   63    (556)   (1,290)   (2,273)   (2,477)
Treasury stock 221,902 shares at cost    (534)   (534)   (534)   (534)   (534)
Total stockholders' equity   94,035    92,507    91,035    88,993    97,313 
Total liabilities and stockholders' equity $  708,270 $  702,152 $  721,259 $  723,733 $  694,812 
      
(1) The adoption of the new lease accounting standards effective January 1, 2019 resulted in $2.8 million of right of use assets being recorded in premise and equipment, net and a corresponding liability in other liabilities.
      

 

CIB MARINE BANCSHARES, INC.
Consolidated Statements of Operations (Unaudited)
         
 At or for the 
 Quarters Ended 6 Months Ended
  June 30,  March 31,  December 31,  September 30,  June 30,   June 30,  June 30, 
  2019  2019  2018  2018  2018   2019  2018 
  
 (Dollars in thousands)
         
Interest Income        
Loans$  5,811 $  5,693 $  5,686 $  5,638 $  5,372  $  11,504 $  10,497 
Loans held for sale  97  85  86  112  117   182  190 
Securities 868  804  828  720  720   1,672  1,495 
Other investments 302  433  409  328  178   735  214 
Total interest income 7,078  7,015  7,009  6,798  6,387   14,093  12,396 
         
Interest Expense        
Deposits 1,949  1,805  1,547  1,343  1,038   3,754  1,986 
Short-term borrowings 307  373  517  424  368   680  605 
Total interest expense 2,256  2,178  2,064  1,767  1,406   4,434  2,591 
Net interest income 4,822  4,837  4,945  5,031  4,981   9,659  9,805 
Provision for (reversal of) loan losses (67) (158) (1,195) (13) 149   (225) 23 
Net interest income after provision for         
(reversal of) loan losses 4,889  4,995  6,140  5,044  4,832   9,884  9,782 
         
Noninterest Income        
Deposit service charges 95  83  79  105  110   178  221 
Other service fees 29  20  31  30  40   49  74 
Mortgage Banking revenue, net 2,148  978  1,057  1,760  2,155   3,126  3,529 
Other income  179  165  143  173  153   344  285 
Net gains (losses) on sale of securities available for sale 0  0  0  (7) 0   0  22 
Unrealized gains (losses) recognized on equity securities 34  30  23  (18) (18)  64  (57)
Net gains on sale of assets  225  86  213  1,020  528   311  726 
Total noninterest income 2,710  1,362  1,546  3,063  2,968   4,072  4,800 
         
Noninterest Expense        
Compensation and employee benefits 4,445  3,687  4,206  4,514  4,682   8,132  8,738 
Equipment 353  335  364  351  337   688  648 
Occupancy and premises 437  456  423  378  422   893  839 
Data Processing 160  166  169  184  162   326  316 
Federal deposit insurance  66  82  74  51  48   148  97 
Professional services 207  140  270  623  290   347  456 
Telephone and data communication 83  78  86  78  79   161  157 
Insurance 52  53  47  60  63   105  124 
Other expense 754  508  776  632  654   1,262  1,186 
Total noninterest expense 6,557  5,505  6,415  6,871  6,737   12,062  12,561 
Income from operations         
before income taxes 1,042  852  1,271  1,236  1,063   1,894  2,021 
Income tax expense 281  229  313  345  241   510  530 
Net income  761  623  958  891  822   1,384  1,491 
Preferred stock dividend 0  0  0  0  0   0  0 
Discount from repurchase of preferred shares 0  0  0  1,703  105   0  105 
Net income allocated to        
 common stockholders$  761 $  623 $  958 $  2,594 $  927  $  1,384 $  1,596