BROOKFIELD, Wis., April 24, 2020 (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 2020. Net income for the quarter ended March 31, 2020, was $0.8 million or $0.04 basic and $0.02 diluted earnings per share, compared to $0.6 million or $0.03 basic and $0.02 diluted earnings per share for the same period of 2019. Pre-tax income for the quarter ended March 31, 2020, was $1.1 million compared to $0.9 million for the same period of 2019.

The increase in net income was the result of a few key factors:

  • The three major lines of revenue were up in the first quarter of 2020 versus the same period in the prior year. Lower rates generated increased mortgage volumes, which drove net mortgage banking revenues up $1.2 million over the first quarter of 2019; gains on sale of SBA 7(a) loans were up $0.4 million due to higher loan production in the first quarter; and net interest income was up $0.1 million and the net interest margin was up 10 basis points compared to the first quarter of 2019, due to a reduction in the cost of funds.
  • The provision for loan losses was up $0.4 million and our write-downs in other real estate owned were up $0.3 million for the three months ending March 31, 2020, versus the same period in 2019. The increase in provisions was primarily due to COVID-19 related deterioration of economic conditions in the first quarter of 2020, net of other factors. Further deterioration is also expected in the foreseeable future.
  • Non-interest expense was up $0.8 million for the three months ending March 31, 2020, compared to the same period of 2019, due primarily to higher compensation related to the increase in mortgage and SBA loan volumes.
  • 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 1.24% and 0.97%, respectively, at March 31, 2020, down from 1.35% and 1.09%, respectively, at December 31, 2019, and 1.51% and 1.29%, respectively, at March 31, 2019. The improvements during the first quarter of 2020 were related to certain loan level improvements, although credit quality is expected to deteriorate in the foreseeable future due to the economic impact of COVID-19.

Mr. J. Brian Chaffin, President and CEO of CIBM, commented, “Early in January 2020, CIBM Bank embarked on a major project designed to improve its operating performance over the coming years. This project involved nearly 40% of our employees and was focused on key revenue improvement areas as well as customer experience, products, and other matters. By the end of March, CIBM Bank was deep into our COVID-19 pandemic response – spending significant time coordinating, communicating and implementing our many internal and external responses to COVID-19. Much of our time has been spent evaluating and preparing for significant changes in operations, products, and delivery due to emerging social distancing norms, shelter in home orders by states, and the many federal support programs for individuals, businesses, and the financial sector. Our investors can be proud of the dedication and commitment CIBM Bank employees have exhibited through this period.”

He added, “Income for the first quarter of 2020 was up versus the prior year and would have been stronger by nearly $1.0 million before tax, except for some COVID-19 related charges in our mortgage pipeline due to market dislocations and disruptions in the mortgage markets, and the provision for loan losses due primarily to the near-term decline in economic conditions. Economic forecasts for the future vary widely, but one thing seems to be clear: we are experiencing a historic decline in employment and private sector economic activity due to society’s response to COVID-19. We are preparing for a significant economic downturn and credit shock in our national, regional, and local economies, and it is our aim to be a source of banking strength for our clients during these times. 

“By being flexible and agile in these unprecedented times, we remain a trusted advisor for our customers. In just the few months since this pandemic began, we have assisted our clients in navigating this new world so that they can benefit from assistance from both the bank and various government programs, including the approval of more than 213 100% U.S. government guaranteed SBA Paycheck Protection Program loans, totaling over $38 million; six months of principal and interest payments to be made by the SBA on SBA 7(a) loans; and internal loan deferral programs.”

He concluded, “Our shareholder meeting will proceed as scheduled on April 30, 2020. Given the current ‘stay at home’ directives, we encourage shareholders to listen to the meeting via teleconference, as outlined in the Proxy Statement.” 

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   3 Months Ended
  March 31, December 31, September 30, June 30, March 31,   March 31, March 31,
    2020     2019     2019     2019     2019       2020     2019  
  (Dollars in thousands, except share and per share data)
Selected Statement of Operations Data                
Interest and dividend income $ 6,636   $ 6,820   $ 7,035   $ 7,078   $ 7,015     $ 6,636   $ 7,015  
Interest expense   1,689     2,030     2,183     2,256     2,178       1,689     2,178  
Net interest income   4,947     4,790     4,852     4,822     4,837       4,947     4,837  
Provision for (reversal of) loan losses   202     715     327     (67 )   (158 )     202     (158 )
Net interest income after provision for                
(reversal of) loan losses   4,745     4,075     4,525     4,889     4,995       4,745     4,995  
Noninterest income (1)   2,642     2,249     3,835     2,710     1,362       2,642     1,362  
Noninterest expense   6,322     6,879     7,233     6,557     5,505       6,322     5,505  
Income (loss) before income taxes   1,065     (555 )   1,127     1,042     852       1,065     852  
Income tax expense (benefit)   281     (180 )   93     281     229       281     229  
Net income (loss) $ 784   $ (375 ) $ 1,034   $ 761   $ 623     $ 784   $ 623  
                 
Common Share Data                
Basic net income (loss) per share (2) $ 0.04   $ (0.02 ) $ 0.07   $ 0.04   $ 0.03     $ 0.04   $ 0.03  
Diluted net income (loss) per share (2)   0.02     (0.02 )   0.04     0.02     0.02       0.02     0.02  
Dividend   0.00     0.00     0.00     0.00     0.00       0.00     0.00  
Tangible book value per share (3)   3.07     2.99     3.03     2.97     2.90       3.07     2.90  
Book value per share (3)   2.73     2.64     2.68     2.60     2.53       2.73     2.53  
Weighted average shares outstanding – basic   18,724,047     18,646,427     18,455,408     18,290,674     18,232,169       18,724,047     18,232,169  
Weighted average shares outstanding – diluted   32,329,698     32,329,533     32,536,354     33,009,983     32,815,744       32,329,698     32,815,744  
Financial Condition Data                
Total assets $ 705,473   $ 703,791   $ 700,711   $ 708,270   $ 702,152     $ 705,473   $ 702,152  
Loans   513,992     513,705     508,758     513,755     489,273       513,992     489,273  
Allowance for loan losses   (8,107 )   (8,007 )   (7,560 )   (7,251 )   (7,865 )     (8,107 )   (7,865 )
Investment securities   120,105     120,398     120,648     124,784     123,500       120,105     123,500  
Deposits   531,999     530,190     557,745     535,367     542,938       531,999     542,938  
Borrowings   68,950     73,847     38,468     69,174     57,220       68,950     57,220  
Stockholders’ equity   95,841     93,404     94,082     94,035     92,507       95,841     92,507  
Financial Ratios and Other Data                
Performance Ratios:                
Net interest margin (4)   3.04 %   2.86 %   2.95 %   2.89 %   2.94 %     3.04 %   2.94 %
Net interest spread (5)   2.78 %   2.55 %   2.62 %   2.58 %   2.64 %     2.78 %   2.64 %
Noninterest income to average assets (6)   1.51 %   1.28 %   2.19 %   1.52 %   0.76 %     1.51 %   0.76 %
Noninterest expense to average assets   3.67 %   3.88 %   4.14 %   3.72 %   3.14 %     3.67 %   3.14 %
Efficiency ratio (7)   83.74 %   97.57 %   83.44 %   87.45 %   89.24 %     83.74 %   89.24 %
Earnings on average assets (8)   0.45 %   -0.21 %   0.59 %   0.43 %   0.36 %     0.45 %   0.36 %
Earnings on average equity (9)   3.32 %   -1.56 %   4.35 %   3.28 %   2.76 %     3.32 %   2.76 %
Asset Quality Ratios:                
Nonaccrual loans to loans (10)   0.97 %   1.09 %   1.14 %   1.12 %   1.29 %     0.97 %   1.29 %
Nonaccrual loans, restructured loans and                
loans 90 days or more past due and still                
accruing to total loans (10)   1.25 %   1.38 %   1.44 %   1.45 %   1.66 %     1.25 %   1.66 %
Nonperforming assets, restructured loans                
and loans 90 days or more past due and still                
accruing to total assets (10)   1.24 %   1.35 %   1.40 %   1.40 %   1.51 %     1.24 %   1.51 %
Allowance for loan losses to total loans (10)   1.58 %   1.56 %   1.49 %   1.41 %   1.61 %     1.58 %   1.61 %
Allowance for loan losses to nonaccrual loans,                
restructured loans and loans 90 days or                
more past due and still accruing (10)   126.26 %   112.66 %   103.07 %   97.34 %   96.96 %     126.26 %   96.96 %
Net charge-offs (recoveries) annualized                
to average loans (10)   0.08 %   0.21 %   0.01 %   0.44 %   -0.06 %     0.08 %   -0.06 %
Capital Ratios:                
Total equity to total assets   13.59 %   13.27 %   13.43 %   13.28 %   13.17 %     13.59 %   13.17 %
Total risk-based capital ratio   15.36 %   15.19 %   15.18 %   15.32 %   15.56 %     15.36 %   15.56 %
Tier 1 risk-based capital ratio   14.11 %   13.94 %   13.93 %   14.07 %   14.31 %     14.11 %   14.31 %
Leverage capital ratio   11.08 %   10.71 %   10.86 %   10.64 %   10.39 %     11.08 %   10.39 %
Other Data:                
Number of employees (full-time equivalent)   177     176     182     180     177       177     177  
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 includes the difference between the carrying amount less the consideration paid for redeemed preferred stock of $0.3 million for the third quarter of 2019 and twelve months ended December 31, 2019.
(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. Book value measures are reported inclusive of the net deferred tax assets. As presented here, shares of common outstanding excludes unvested Restricted Stock Awards.
(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)
 
  March 31, December 31, September 30, June 30, March 31,
    2020     2019     2019     2019     2019  
  (Dollars in Thousands, Except Shares)
Assets          
Cash and due from banks $ 9,006   $ 8,970   $ 9,582   $ 8,791   $ 8,168  
Reverse repurchase agreements   3,622     11,196     4,083     18,347     42,729  
Securities available for sale   117,640     117,972     118,211     122,365     121,115  
Equity securities at fair value   2,465     2,426     2,437     2,419     2,385  
Loans held for sale   24,988     16,928     25,347     8,450     4,467  
           
Loans   513,992     513,705     508,758     513,755     489,273  
Allowance for loan losses   (8,107 )   (8,007 )   (7,560 )   (7,251 )   (7,865 )
Net loans   505,885     505,698     501,198     506,504     481,408  
           
Federal Home Loan Bank Stock   2,947     2,587     926     2,363     2,003  
Premises and equipment, net   4,769     4,274     4,504     4,643     4,538  
Accrued interest receivable   1,610     1,486     1,646     1,820     1,873  
Deferred tax assets, net   19,509     20,069     20,455     20,703     21,156  
Other real estate owned, net   2,335     2,396     2,466     2,466     2,466  
Bank owned life insurance   4,718     4,691     4,666     4,640     4,613  
Goodwill and other intangible assets   148     154     159     165     171  
Other assets   5,831     4,944     5,031     4,594     5,060  
Total Assets $ 705,473   $ 703,791   $ 700,711   $ 708,270   $ 702,152  
           
Liabilities and Stockholders’ Equity          
Deposits:          
Noninterest-bearing demand $ 67,459   $ 70,175   $ 63,694   $ 62,424   $ 62,553  
Interest-bearing demand   47,760     45,512     50,683     32,649     32,467  
Savings   196,797     204,976     202,866     192,133     188,110  
Time   219,983     209,527     240,502     248,161     259,808  
Total deposits   531,999     530,190     557,745     535,367     542,938  
Short-term borrowings   68,950     73,847     38,468     69,174     57,220  
Accrued interest payable   543     603     711     725     727  
Other liabilities   8,140     5,747     9,705     8,969     8,760  
Total liabilities   609,632     610,387     606,629     614,235     609,645  
           
Stockholders’ Equity          
Preferred stock, $1 par value; 5,000,000 authorized shares at both March 31, 2020 and December 31, 2019; 7% fixed rate noncumulative perpetual issued; 40,888 shares of series A and 3,217 shares of series B; convertible; $44.1 million aggregate liquidation preference   37,490     37,490     37,489     39,384     39,384  
Common stock, $1 par value; 75,000,000 authorized shares; 19,162,637 and 18,868,329 issued shares; 18,951,590 and 18,657,282 outstanding shares at March 31, 2020 and December 31, 2019, respectively. (1)   19,162     18,868     18,868     18,543     18,456  
Capital surplus   160,990     161,175     161,110     160,991     160,930  
Accumulated deficit   (122,969 )   (123,753 )   (123,377 )   (124,412 )   (125,173 )
Accumulated other comprehensive income (loss), net   1,702     158     526     63     (556 )
Treasury stock 221,902 shares at cost   (534 )   (534 )   (534 )   (534 )   (534 )
Total stockholders’ equity   95,841     93,404     94,082     94,035     92,507  
Total liabilities and stockholders’ equity $ 705,473   $ 703,791   $ 700,711   $ 708,270   $ 702,152  
 
(1) Both issued and outstanding shares as stated here exclude 521,087 shares and 815,395 shares of unvested restricted stock awards at March 31,2020 and December 31, 2019, respectively.
 

 

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,
    2020     2019     2019     2019     2019       2020     2019  
  (Dollars in thousands)
                 
Interest Income                
Loans $ 5,703   $ 5,793   $ 5,992   $ 5,811   $ 5,693     $ 5,703   $ 5,693  
Loans held for sale   119     195     152     97     85       119     85  
Securities   763     764     810     868     804       763     804  
Other investments   51     68     81     302     433       51     433  
Total interest income   6,636     6,820     7,035     7,078     7,015       6,636     7,015  
                 
Interest Expense                
Deposits   1,512     1,856     2,027     1,949     1,805       1,512     1,805  
Short-term borrowings   177     174     156     307     373       177     373  
Total interest expense   1,689     2,030     2,183     2,256     2,178       1,689     2,178  
Net interest income   4,947     4,790     4,852     4,822     4,837       4,947     4,837  
Provision for (reversal of) loan losses   202     715     327     (67 )   (158 )     202     (158 )
Net interest income after provision for                
(reversal of) loan losses   4,745     4,075     4,525     4,889     4,995       4,745     4,995  
                 
Noninterest Income                
Deposit service charges   96     98     101     95     83       96     83  
Other service fees   20     23     30     29     20       20     20  
Mortgage banking revenue, net   2,177     2,112     2,936     2,148     978       2,177     978  
Other income   265     129     150     179     165       265     165  
Net gains on sale of securities available for sale   0     0     0     0     0       0     0  
Unrealized gains (losses) recognized on equity securities   39     (11 )   18     34     30       39     30  
Net gains on sale of SBA loans   437     166     605     253     0       437     0  
Net gains (losses) on sale of assets and (writedowns)   (392 )   (268 )   (5 )   (28 )   86       (392 )   86  
Total noninterest income   2,642     2,249     3,835     2,710     1,362       2,642     1,362  
                 
Noninterest Expense                
Compensation and employee benefits   4,421     4,701     5,309     4,445     3,687       4,421     3,687  
Equipment   363     394     335     353     335       363     335  
Occupancy and premises   460     460     420     437     456       460     456  
Data Processing   164     157     165     160     166       164     166  
Federal deposit insurance   0     (10 )   (5 )   66     82       0     82  
Professional services   298     320     198     207     140       298     140  
Telephone and data communication   68     81     86     83     78       68     78  
Insurance   54     59     70     52     53       54     53  
Other expense   494     717     655     754     508       494     508  
Total noninterest expense   6,322     6,879     7,233     6,557     5,505       6,322     5,505  
Income (losses) from operations                
before income taxes   1,065     (555 )   1,127     1,042     852       1,065     852  
Income tax expense (benefit)   281     (180 )   93     281     229       281     229  
Net income (loss)   784     (375 )   1,034     761     623       784     623  
Preferred stock dividend   0     0     0     0     0       0     0  
Discount from repurchase of preferred stock   0     0     308     0     0       0     0  
Net income (loss) allocated to                
 common stockholders $ 784   $ (375 ) $ 1,342   $ 761   $ 623     $ 784   $ 623  
                 

 



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