SOURCE: CIB Marine Bancshares, Inc.

CIB Marine Bancshares, Inc.

January 13, 2017 17:00 ET

CIB Marine Bancshares, Inc. Announces 2016 Results

WAUKESHA, WI--(Marketwired - January 13, 2017) - 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 fourth quarter and year of 2016. Net income for the fourth quarter of 2016 was $1.4 million or $0.08 basic and $0.04 diluted earnings per share compared to a loss of $0.8 million or $0.04 basic and diluted earnings per share for the same period in 2015, and for the year ended December 31, 2016, net income was $4.4 million or $0.24 basic and $0.12 diluted earnings per share compared to a loss of $0.6 million or $0.03 basic and diluted earnings per share for the same period of 2015.

Select highlights for the quarter and year include:

  • Return on average assets was 0.71% for the year 2016, a substantial improvement over the (0.12%) reported for the year 2015.
  • Net income for subsidiary CIBM Bank was $4.6 million for the year 2016, an increase of $4.3 million from the year 2015.
  • Net interest income increased $1.8 million for the year 2016 compared 2015. The increase was primarily due to a $64 million dollar increase in average loans outstanding.
  • Non-interest income increased $5.0 million for the year 2016 compared to the same period of 2015, due primarily to mortgage activity and, to a lesser extent, gains related to assets previously charged or written down. For the quarter, net mortgage banking revenues were down $0.9 million due to seasonal factors and the increase in interest rates.
  • Reversal of loan losses was $0.9 million for the year ending December 31, 2016, compared to a provision for loan losses of $0.1 million for the same period in 2015. The reversal of loan losses was related to a $1.5 million structured settlement payment announced earlier in 2016 which has been received and recorded in the allowance for loan losses as a recovery of loans previously charged off.
  • Noninterest expenses rose for the year 2016 by $2.7 million versus the prior year, primarily due to a $2.9 million increase in compensation caused by commissions for higher loan originations offset by reductions in other areas.
  • Non-performing assets to total assets were 1.83% at the year-end 2016, down from 2.25% the prior year end and up from 1.32% at September 30, 2016. The increase from the prior quarter-end was due primarily to one relationship.
  • Net recoveries for loans previously charged off to average loans was (0.24%) for the year ending December 31, 2016, compared to (0.11%) for the same period in the prior year.

"CIB Marine completed a successful year in 2016 and is pleased to be reporting for the year an increase of 74% in the book value per share of common stock and progress in a number of strategic areas of the company," said Mr. J. Brian Chaffin, President and Chief Executive Officer of CIB Marine Bancshares, Inc. "For the year 2016 our loan portfolio grew on net 8.8% reflecting more than $100 million in new portfolio loan originations, deposits grew 8.9% and mortgage revenues grew 92%. In addition, we started our SBA lending and facility financing activities; executed a significant expense management program; and made a number of investments in information technology to enhance our services and improve product delivery, as well as fund a number of security and infrastructure measures."

Mr. Chaffin added, "Our eyes and energy are focused on 2017 and the future now. Interest rates are higher across the yield curve over the past year and Fed policy rates are forecast to increase further in 2017. During 2017 we expect a softer residential lending market due to the increase in mortgage rates, but we continue to work on expanding our mortgage lending activities more deeply through our banking markets and we are optimistic our SBA lending activities will increase over the prior year. Our traditional retail and commercial community banking activities contributed significantly to the results in 2016 and we are working towards continued development and growth of our customer relationships within the communities where we live and work."

CIB Marine Bancshares, Inc. is the holding company for CIBM Bank, which operates 11 banking offices and 3 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 December 31, 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  Years Ended
  December 31,  September 30,  June 30,  March 31,  December 31,  December 31,  December 31,
  2016  2016  2016  2016  2015  2016  2015
  (Dollars in thousands, except share and per share data)
Selected Statement of Operations Data                           
Interest and dividend income $5,273  $5,286  $5,214  $5,176  $4,874  $20,949  $18,530
Interest expense  793   740   729   735   654   2,997   2,377
 Net interest income  4,480   4,546   4,485   4,441   4,220   17,952   16,153
Provision for (reversal of) loan losses  (1,101)   69   118   61   215   (853)   61
 Net interest income after provision for (reversal of) loan losses  5,581   4,477   4,367   4,380   4,005   18,805   16,092
Noninterest income (1)  1,908   2,651   2,788   2,053   592   9,400   4,426
Noninterest expense  6,127   6,220   5,951   5,481   5,386   23,779   21,117
 Income (loss) before income taxes  1,362   908   1,204   952   (789)   4,426   (599)
Income tax expense  (5)   40   15   0   6   50   6
 Net income (loss) $1,367  $868  $1,189  $952  $(795)  $4,376  $(605)
                            
Common Share Data                           
 Basic net income (loss) per share $0.08  $0.05  $0.07  $0.05  $(0.04)  $0.24  $(0.03)
 Diluted net income (loss) per share  0.04   0.02   0.03   0.03   (0.04)   0.12   (0.03)
 Dividend  0   0   0   0   0   0   0
 Tangible book value per share (2)  1.03   1.04   0.99   0.90   0.79   1.03   0.79
 Book value per share (2)  0.54   0.56   0.51   0.41   0.31   0.54   0.31
 Weighted average shares outstanding - basic  18,127,892   18,127,892   18,127,892   18,127,892   18,127,892   18,127,892   18,127,892
 Weighted average shares outstanding - diluted  36,082,522   35,818,022   35,631,892   35,631,892   18,127,892   35,791,952   18,127,892
Financial Condition Data                           
 Total assets $653,864  $632,628  $615,708  $597,089  $571,233  $653,864  $571,233
 Loans  484,255   466,057   461,859   470,424   445,050   484,255   445,050
 Allowance for loan losses  (8,329)   (8,549)   (8,219)   (8,235)   (8,064)   (8,329)   (8,064)
 Investment securities  112,072   103,853   103,542   97,474   94,702   112,072   94,702
 Deposits  483,097   476,428   468,377   467,334   443,571   483,097   443,571
 Borrowings  96,944   81,636   72,833   57,929   58,883   96,944   58,883
 Stockholders' equity  69,828   70,094   69,266   67,475   65,586   69,828   65,586
Financial Ratios and Other Data                           
 Performance Ratios:                           
  Net interest margin (3)  2.84%   2.95%   3.11%   3.15%   3.14%   3.01%   3.18%
  Net interest spread (4)  2.70%   2.80%   2.96%   3.00%   2.98%   2.86%   3.03%
  Noninterest income to average assets (5)  1.18%   1.68%   1.88%   1.42%   0.43%   1.53%   0.84%
  Noninterest expense to average assets  3.79%   3.93%   4.02%   3.78%   3.89%   3.88%   4.02%
  Efficiency ratio (6)  95.91%   86.42%   81.82%   84.40%   111.93%   86.94%   102.68%
  Earnings (loss) on average assets (7)  0.85%   0.55%   0.80%   0.66%   -0.57%   0.71%   -0.12%
  Earnings (loss) on average equity (8)  7.63%   4.89%   6.98%   5.75%   -4.65%   6.32%   -0.89%
Asset Quality Ratios:                           
 Nonaccrual loans to loans (9)  1.41%   1.16%   0.81%   0.81%   0.70%   1.41%   0.70%
 Nonaccrual loans, restructured loans and loans 90 days or more past due and still accruing to total loans (9)  1.75%   1.58%   1.63%   1.64%   1.96%   1.75%   1.96%
 Nonperforming assets, restructured loans and loans 90 days or more past due and still accruing to total assets (9)  1.83%   1.32%   1.59%   1.94%   2.25%   1.83%   2.25%
 Allowance for loan losses to total loans  1.72%   1.83%   1.78%   1.75%   1.81%   1.72%   1.81%
 Allowance for loan losses to nonaccrual loans, restructured loans and loans 90 days or more past due and still accruing (9)  98.16%   116.08%   109.14%   106.74%   92.25%   98.16%   92.25%
 Net charge-offs (recoveries) annualized to average loans  -0.74%   -0.22%   0.12%   -0.10%   0.03%   -0.24%   -0.11%
Capital Ratios:                           
 Total equity to total assets  10.68%   11.08%   11.25%   11.30%   11.48%   10.68%   11.48%
 Total risk-based capital ratio  15.55%   15.66%   15.60%   15.19%   15.45%   15.55%   15.45%
 Tier 1 risk-based capital ratio  14.29%   14.41%   14.34%   13.93%   14.20%   14.29%   14.20%
 Leverage capital ratio  11.18%   11.20%   11.69%   11.72%   12.27%   11.18%   12.27%
Other Data:                           
 Number of employees (full-time equivalent)  171   169   167   180   173   171   173
 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)
               
  December 31,  September 30,  June 30,  March 31,  December 31,
  2016  2016  2016  2016  2015
  (Dollars in thousands, except share data)
Assets                         
Cash and due from banks $10,291   $11,427   $9,808   $9,136   $9,170  
Reverse repurchase agreements  24,275    27,560    20,313    -    -  
Securities available for sale  112,072    103,853    103,542    97,474    94,702  
Loans held for sale  11,469    15,875    11,602    10,176    12,275  
                          
Loans  484,255    466,057    461,859    470,424    445,050  
Allowance for loan losses  (8,329 )  (8,549 )  (8,219 )  (8,235 )  (8,064 )
 Net loans  475,926    457,508    453,640    462,189    436,986  
                          
Federal Home Loan Bank Stock  3,803    3,803    2,170    2,170    2,170  
Premises and equipment, net  4,427    4,256    4,358    4,716    4,771  
Accrued interest receivable  1,382    1,289    1,290    1,468    1,296  
Other real estate owned, net  3,464    982    2,283    3,859    4,126  
Bank owned life insurance  4,389    4,363    4,336    4,310    4,285  
Goodwill and other intangible assets  221    226    232    237    243  
Other assets  2,145    1,486    2,134    1,354    1,209  
 Total Assets $653,864   $632,628   $615,708   $597,089   $571,233  
                          
Liabilities and Stockholders' Equity                         
Deposits:                         
 Noninterest-bearing demand $77,154   $87,216   $82,460   $74,564   $77,580  
 Interest-bearing demand  33,832    29,821    31,508    32,096    33,192  
 Savings  176,435    169,390    175,955    175,576    162,663  
 Time  195,676    190,001    178,454    185,098    170,136  
  Total deposits  483,097    476,428    468,377    467,334    443,571  
Short-term borrowings  96,944    81,636    72,833    57,929    58,883  
Accrued interest payable  349    319    335    339    321  
Other liabilities  3,646    4,151    4,897    4,012    2,872  
  Total liabilities  584,036    562,534    546,442    529,614    505,647  
                          
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  158,552    158,510    158,493    158,493    158,493  
Accumulated deficit  (155,212 )  (156,579 )  (157,446 )  (158,636 )  (159,588 )
Accumulated other comprehensive loss, net  (2,329 )  (654 )  (598 )  (1,199 )  (2,136 )
Treasury stock 218,499 shares at cost  (529 )  (529 )  (529 )  (529 )  (529 )
  Total stockholders' equity  69,828    70,094    69,266    67,475    65,586  
  Total liabilities and stockholders' equity $653,864   $632,628   $615,708   $597,089   $571,233  
                    
                    
CIB MARINE BANCSHARES, INC.
Consolidated Statements of Operations (Unaudited)
  At or for the  
  Quarters Ended   Years Ended  
  December 31,   September 30,   June 30,  March 31,  December 31,   December 31,   December 31,  
  2016   2016   2016  2016  2015   2016   2015  
  (Dollars in thousands)  
                                  
Interest Income                                 
Loans $4,493   $4,540   $4,635  $4,572  $4,248   $18,240   $15,972  
Loans held for sale  141    153    95   83   77    472    341  
Securities  563    513    478   517   546    2,071    2,206  
Other investments  76    80    6   4   3    166    11  
 Total interest income  5,273    5,286    5,214   5,176   4,874    20,949    18,530  
                                  
Interest Expense                                 
Deposits  697    659    692   705   640    2,753    2,327  
Short-term borrowings  96    81    37   30   14    244    50  
 Total interest expense  793    740    729   735   654    2,997    2,377  
 Net interest income  4,480    4,546    4,485   4,441   4,220    17,952    16,153  
Provision for (reversal of) loan losses  (1,101 )  69    118   61   215    (853 )  61  
 Net interest income after provision for (reversal of) loan losses  5,581    4,477    4,367   4,380   4,005    18,805    16,092  
                                  
Noninterest Income                                 
Deposit service charges  121    125    121   103   113    470    450  
Other service fees  45    47    52   67   60    211    236  
Mortgage Banking revenue, net  1,414    2,285    2,102   1,336   545    7,137    3,724  
Other income  136    206    96   117   104    555    444  
Net gains on sale of securities  0    0    0   0   0    0    13  
Net gains (losses) on sale of assets and (writedowns)  192    (12 )  417   430   (230 )  1,027    (441 )
 Total noninterest income  1,908    2,651    2,788   2,053   592    9,400    4,426  
                                  
Noninterest Expense                                 
Compensation and employee benefits  4,228    4,426    4,143   3,624   3,419    16,421    13,515  
Equipment  305    277    293   273   277    1,148    1,068  
Occupancy and premises  390    377    389   435   396    1,591    1,576  
Data Processing  123    185    151   154   158    613    621  
Federal deposit insurance  92    105    106   106   104    409    425  
Professional services  156    157    213   249   228    775    942  
Telephone and data communication  90    92    99   109   113    390    411  
Insurance  60    60    56   54   53    230    221  
Other expense  683    541    501   477   638    2,202    2,338  
 Total noninterest expense  6,127    6,220    5,951   5,481   5,386    23,779    21,117  
Income (loss) from operations before income taxes  1,362    908    1,204   952   (789 )  4,426    (599 )
Income tax expense  (5 )  40    15   0   6    50    6  
 Net income (loss)  1,367    868    1,189   952   (795 )  4,376    (605 )
Preferred stock dividend  0    0    0   0   0    0    0  
  Net income (loss) allocated to common stockholders $1,367   $868   $1,189  $952  $(795 ) $4,376   $(605 )
                            

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