CIB Marine Bancshares, Inc. Announces First Quarter 2021 Results

Brookfield, Wisconsin, UNITED STATES


BROOKFIELD, Wis., April 12, 2021 (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 first quarter of 2021. Net income for the quarter ended March 31, 2021, was $2.1 million or $1.67 basic and $0.97 diluted earnings per share, compared to $0.8 million or $0.63 basic and $0.36 diluted earnings per share for the same period of 2020.

Financial highlights for the quarter include:

  • Tangible book value attributable to the common stock increased to $53.25 per share outstanding at March 31, 2021 compared to $52.28 at December 31, 2020, and $46.05 at March 31, 2020, reflecting a 15.7% year-on-year increase.
  • Net mortgage banking revenues were up $2.8 million for the quarter versus the same period of 2020, reflecting a $63 million increase in residential mortgage loans for the period, due primarily to refinance activity driven by lower interest rates. Compensation expenses increased $1.5 million compared to the same period in 2020, largely related to mortgage lending compensation.
  • When compared to the first quarter of 2020, first quarter 2021 net interest income was up $0.8 million; net interest margin was up 19 basis points to 3.23%, reflecting an 89 basis point improvement in the cost of interest bearing liabilities compared to a 55 basis point decline in interest earning asset yields; and average interest earning assets were up $65 million, primarily in commercial segment loans and residential loans held for sale.
  • Non-performing assets, restructured loans, and loans 90 days or more past due and still accruing to total assets and nonaccrual loans to total loans were 0.52% and 0.23%, respectively, at March 31, 2021, compared to 0.54% and 0.23%, respectively, at December 31, 2020, and down from 1.24% and 0.97%, respectively, at March 31, 2020. Recent measures continue to be near this credit cycle’s best.
  • During the first quarter, CIBM Bank originated $18 million in new Paycheck Protection Plan (PPP) loans and received SBA forgiveness funding to close $19 million in PPP loans originated in 2020.
  • Deposits for checking, savings, and money market accounts grew by $44 million during the quarter, reflecting federal fiscal and monetary policies (e.g., low interest rates) and marketing activity results.

Mr. J. Brian Chaffin, CIB Marine’s President and CEO, commented, “We are pleased with another quarter of strong income and a return on average assets of 1.14% due to continued strength in mortgage lending activity and solid progress in the net interest margin. We typically see a seasonal uptick in purchase money mortgage activity in the warmer months, and we expect that to be countered by reduced refinance activity as a result of the recent increase in long term interest rates.

“Our balance sheet has grown since year-end as a result of (a) surging checking and money market account balances due, in part, to federal economic stimulus policies and programs and (b) steady commercial loan production, which has replaced residential loan balances as refinanced mortgages are sold. While the banking industry as a whole performed better than many experts predicted over the past year, and CIBM performed even better than the peer, particularly with regard to credit metrics, we remain cautious about future credit quality in higher risk segments of the loan portfolio due to the lingering impact of the pandemic,” he concluded.

CIB Marine Bancshares, Inc. is the holding company for CIBM Bank, which operates ten 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 3 Months Ended
 March 31,December 31,September 30,June 30,March 31, March 31,March 31,
  2021  2020  2020  2020  2020   2021  2020 
  
 (Dollars in thousands, except share and per share data)
Selected Statement of Operations Data:        
Interest and dividend income$6,265 $6,489 $7,202 $6,669 $6,636  $6,265 $6,636 
Interest expense 536  765  1,017  1,343  1,689   536  1,689 
Net interest income 5,729  5,724  6,185  5,326  4,947   5,729  4,947 
Provision for loan losses 20  101  501  249  202   20  202 
Net interest income after provision for        
loan losses 5,709  5,623  5,684  5,077  4,745   5,709  4,745 
Noninterest income (1) 5,146  6,566  8,104  4,489  2,642   5,146  2,642 
Noninterest expense 7,940  9,317  9,056  7,308  6,322   7,940  6,322 
Income before income taxes 2,915  2,872  4,732  2,258  1,065   2,915  1,065 
Income tax expense 798  565  1,322  575  281   798  281 
Net income$2,117 $2,307 $3,410 $1,683 $784  $2,117 $784 
         
Common Share Data (2):        
Basic net income per share (3)$1.67 $1.82 $2.69 $1.36 $0.63  $1.67 $0.63 
Diluted net income per share (3) 0.97  1.06  1.56  0.79  0.36   0.98  0.36 
Dividend 0.00  0.00  0.00  0.00  0.00   0.00  0.00 
Tangible book value per share (4) 53.25  52.28  50.35  47.25  46.05   53.25  46.05 
Book value per share (4) 48.21  47.19  45.27  42.00  40.95   48.21  40.95 
Weighted average shares outstanding - basic 1,268,947  1,267,584  1,267,582  1,266,174  1,248,275   1,268,947  1,248,275 
Weighted average shares outstanding - diluted 2,185,433  2,181,142  2,181,868  2,160,201  2,155,315   2,185,433  2,155,315 
Financial Condition Data:        
Total assets$752,715 $750,982 $793,604 $793,151 $705,473  $752,715 $705,473 
Loans 540,206  539,227  546,351  535,692  513,992   540,206  513,992 
Allowance for loan losses (9,253) (9,122) (9,037) (8,483) (8,107)  (9,253) (8,107)
Investment securities 112,400  108,492  107,351  113,303  120,105   112,400  120,105 
Deposits 608,433  586,373  593,370  566,811  531,999   608,433  531,999 
Borrowings 30,736  51,310  87,994  120,233  68,950   30,736  68,950 
Stockholders' equity 105,593  103,704  101,271  97,347  95,841   105,593  95,841 
Financial Ratios and Other Data:        
Performance Ratios:        
Net interest margin (5) 3.23% 3.14% 3.30% 2.96% 3.04%  3.23% 3.04%
Net interest spread (6) 3.13% 3.01% 3.16% 2.76% 2.78%  3.13% 2.78%
Noninterest income to average assets (7) 2.79% 3.43% 4.12% 2.36% 1.51%  2.79% 1.51%
Noninterest expense to average assets 4.27% 4.86% 4.60% 3.86% 3.67%  4.27% 3.67%
Efficiency ratio (8) 72.72% 75.77% 63.38% 74.61% 83.74%  72.72% 83.74%
Earnings on average assets (9) 1.14% 1.20% 1.73% 0.89% 0.45%  1.14% 0.45%
Earnings on average equity (10) 8.10% 8.83% 13.51% 6.97% 3.32%  8.10% 3.32%
Asset Quality Ratios:        
Nonaccrual loans to loans (11) 0.23% 0.23% 0.32% 0.92% 0.97%  0.23% 0.97%
Nonaccrual loans, restructured loans and        
loans 90 days or more past due and still        
accruing to total loans (11) 0.37% 0.40% 0.49% 1.07% 1.25%  0.37% 1.25%
Nonperforming assets, restructured loans        
and loans 90 days or more past due and still        
accruing to total assets (11) 0.52% 0.54% 0.60% 1.02% 1.24%  0.52% 1.24%
Allowance for loan losses to total loans (11) 1.71% 1.69% 1.65% 1.58% 1.58%  1.71% 1.58%
Allowance for loan losses to nonaccrual loans,        
restructured loans and loans 90 days or        
more past due and still accruing (11) 459.21% 421.14% 338.59% 147.79% 126.26%  459.21% 126.26%
Net charge-offs (recoveries) annualized        
to average loans (11) -0.08% 0.01% -0.04% -0.09% 0.08%  -0.01% 0.15%
Capital Ratios:        
Total equity to total assets 14.03% 13.81% 12.76% 12.27% 13.59%  14.03% 13.59%
Total risk-based capital ratio 18.15% 17.44% 16.13% 15.49% 15.36%  18.15% 15.36%
Tier 1 risk-based capital ratio 16.89% 16.19% 14.87% 14.23% 14.11%  16.89% 14.11%
Leverage capital ratio 11.88% 11.46% 11.20% 10.82% 11.08%  11.88% 11.08%
Other Data:        
Number of employees (full-time equivalent) 179  176  176  177  177   179  177 
Number of banking facilities 10  11  11  11  11   10  11 
         
(1) Noninterest income includes gains and losses on securities.
(2) Common share data prior to September 14, 2020, is adjusted to reflect the 1:15 reverse split to allow for comparability between the pre- and post- reverse split periods.
(3) Net income available to common stockholders in the calculation of earnings per share includes the difference between the carrying amount less the consideration paid for redeemed preferred stock of $0.03 million for the 2nd quarter and 12 months ended 2020.
(4) 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. Book value measures are reported inclusive of the net deferred tax assets. As presented here, shares of common outstanding excludes unvested restricted stock awards.
(5) Net interest margin is the ratio of net interest income to average interest-earning assets.
(6) Net interest spread is the yield on average interest-earning assets less the rate on average interest-bearing liabilities.
(7) Noninterest income to average assets excludes gains and losses on securities.
(8) The efficiency ratio is noninterest expense divided by the sum of net interest income plus noninterest income, excluding gains and losses on securities.
(9) Earnings on average assets are net income divided by average total assets.
(10) Earnings on average equity are net income divided by average stockholders' equity.
(11) Excludes loans held for sale.



CIB MARINE BANCSHARES, INC.
Consolidated Balance Sheets (unaudited)
      
 March 31,December 31,September 30,June 30,March 31,
  2021  2020  2020  2020  2020 
 (Dollars in Thousands, Except Shares)
Assets     
Cash and due from banks$51,691 $29,927 $30,544 $9,120 $9,006 
Reverse repurchase agreements -  -  8,208  18,117  3,622 
Securities available for sale 109,965  106,014  104,866  110,818  117,640 
Equity securities at fair value 2,435  2,478  2,485  2,485  2,465 
Loans held for sale 18,136  42,977  67,496  83,997  24,988 
      
Loans 540,206  539,227  546,351  535,692  513,992 
Allowance for loan losses (9,253) (9,122) (9,037) (8,483) (8,107)
Net loans 530,953  530,105  537,314  527,209  505,885 
      
Federal Home Loan Bank Stock 3,140  3,140  3,140  2,948  2,947 
Premises and equipment, net 4,476  4,682  4,667  4,679  4,769 
Accrued interest receivable 1,983  2,050  2,075  1,973  1,610 
Deferred tax assets, net 16,417  16,292  18,547  19,325  19,509 
Other real estate owned, net 1,875  1,875  2,103  2,334  2,335 
Bank owned life insurance 4,831  4,802  4,774  4,745  4,718 
Goodwill and other intangible assets 126  131  137  142  148 
Other assets 6,687  6,509  7,248  5,259  5,831 
Total Assets$752,715 $750,982 $793,604 $793,151 $705,473 
      
Liabilities and Stockholders' Equity      
Deposits:     
Noninterest-bearing demand$109,466 $92,544 $91,134 $90,450 $67,459 
Interest-bearing demand 63,033  59,679  61,262  54,288  47,760 
Savings 268,026  243,888  225,724  205,470  196,797 
Time 167,908  190,262  215,250  216,603  219,983 
Total deposits 608,433  586,373  593,370  566,811  531,999 
Short-term borrowings 30,736  51,310  54,052  77,273  68,950 
Long-term borrowings -  -  33,942  42,960  - 
Accrued interest payable 140  246  398  447  543 
Other liabilities 7,813  9,349  10,571  8,313  8,140 
Total liabilities 647,122  647,278  692,333  695,804  609,632 
      
Stockholders' Equity      
Preferred stock, $1 par value; 5,000,000 authorized shares at both March 31, 2021 and December 31, 2020; 7% fixed rate noncumulative perpetual issued; 40,690 shares of series A and 3,201 shares of series B; convertible; $43.9 million aggregate liquidation preference 37,308  37,308  37,308  37,308  37,490 
                
Common stock, $1 par value; 75,000,000 authorized shares; 1,294,665 and 1,282,385 issued shares; 1,280,596 and 1,268,316 outstanding shares at March 31, 2021 and December 31, 2020, respectively. (1)(2) 1,295  1,282  1,282  19,240  19,162 
Capital surplus (2) 179,291  179,188  179,090  161,032  160,990 
Accumulated deficit (113,452) (115,569) (117,875) (121,285) (122,969)
Accumulated other comprehensive income, net 1,685  2,029  2,000  1,586  1,702 
Treasury stock, 14,791 shares on March 31, 2021 and December 31, 2020 and 221,902 shares prior at cost (2) (534) (534) (534) (534) (534)
Total stockholders' equity 105,593  103,704  101,271  97,347  95,841 
Total liabilities and stockholders' equity$752,715 $750,982 $793,604 $793,151 $705,473 
      
(1) Both issued and outstanding shares as stated here exclude 75,146 shares of unvested restricted stock awards at March 31, 2021 and 59,842 at December 31, 2020.
(2) Effective September 14, 2020, the Company executed a reverse stock split of 1 share for every 15 shares outstanding. Fractional shares were remitted cash at the then-current market value of $15.75 per share.



CIB MARINE BANCSHARES, INC.
Consolidated Statements of Operations (Unaudited)
         
 At or for the
 Quarters Ended 3 Months Ended
 March 31,December 31,September 30,June 30,March 31, March 31,March 31,
  2021  2020  2020  2020  2020   2021  2020 
                       
 (Dollars in thousands)
         
Interest Income        
Loans$5,524 $5,577 $6,054 $5,540 $5,703  $5,524 $5,703 
Loans held for sale 175  331  537  451  119   175  119 
Securities 555  564  573  661  763   555  763 
Other investments 11  17  38  17  51   11  51 
Total interest income 6,265  6,489  7,202  6,669  6,636   6,265  6,636 
         
Interest Expense        
Deposits 512  735  942  1,263  1,512   512  1,512 
Short-term borrowings 24  30  38  54  177   24  177 
Long-term borrowings 0  0  37  26  0   0  0 
Total interest expense 536  765  1,017  1,343  1,689   536  1,689 
Net interest income 5,729  5,724  6,185  5,326  4,947   5,729  4,947 
Provision for loan losses 20  101  501  249  202   20  202 
Net interest income after provision for        
loan losses 5,709  5,623  5,684  5,077  4,745   5,709  4,745 
         
Noninterest Income        
Deposit service charges 84  91  89  88  96   84  96 
Other service fees 40  37  36  36  20   40  20 
Mortgage banking revenue, net 4,983  6,387  7,741  3,990  2,177   4,983  2,177 
Other income 192  165  226  266  265   192  265 
Net gains on sale of securities available for sale 0  0  0  0  0   0  0 
Unrealized gains (losses) recognized on equity securities (43) (6) 0  20  39   (43) 39 
Net gains (loss) on sale of SBA loans 0  55  (55) 87  437   0  437 
Net gains (losses) on sale of assets and (writedowns) (110) (163) 67  2  (392)  (110) (392)
Total noninterest income 5,146  6,566  8,104  4,489  2,642   5,146  2,642 
         
Noninterest Expense        
Compensation and employee benefits 5,956  7,015  7,329  5,451  4,421   5,956  4,421 
Equipment 379  402  352  379  363   379  363 
Occupancy and premises 434  452  390  407  460   434  460 
Data Processing 185  178  177  155  164   185  164 
Federal deposit insurance 48  49  48  47  0   48  0 
Professional services 253  322  162  242  298   253  298 
Telephone and data communication 60  82  71  67  68   60  68 
Insurance 68  62  58  55  54   68  54 
Other expense 557  755  469  505  494   557  494 
Total noninterest expense 7,940  9,317  9,056  7,308  6,322   7,940  6,322 
Income from operations        
before income taxes 2,915  2,872  4,732  2,258  1,065   2,915  1,065 
Income tax expense 798  565  1,322  575  281   798  281 
Net income  2,117  2,307  3,410  1,683  784   2,117  784 
Preferred stock dividend 0  0  0  0  0   0  0 
Discount from repurchase of preferred stock 0  0  33  0  0   0  0 
Net income allocated to        
 common stockholders$2,117 $2,307 $3,443 $1,683 $784  $2,117 $784