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CIB Marine Bancshares, Inc. Announces Second Quarter 2021 Results – Hub News Report



Press release content from Globe Newswire. The AP news staff was not involved in its creation.

BROOKFIELD, Wis., July 13, 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 six months and quarter ended June 30, 2021. Net income for the six months was $3.5 million compared to $2.5 million for the same period in 2020, and $1.4 million for the quarter compared to $1.7 million for the same quarter in 2020.

Financial highlights include:

  • Return on average assets improved to 0.94% for the six months, compared to 0.68% for the same period in 2020; and 0.74% for the quarter compared to 0.89% for the same period of 2020.
  • Tangible book value attributable to the common stock increased to $54.19 per share outstanding at June 30, 2021, compared to $52.28 at December 31, 2020, and $47.25 at June 30, 2020, reflecting a 12-month increase of 14.7%.
  • Net interest income was up for the six months and the quarter by $1.2 million and $0.5 million, respectively, compared to the same periods in 2020. The primary reason for the change is a 74 basis point and 60 basis point decline in the cost of interest bearing liabilities over the respective time periods, compared to a 36 and 19 basis point change in yields on interest earning assets, respectively. The change in the cost of interest bearing liabilities is due to repricing in a lower rate environment and a shift in balances from higher rate time deposits to lower rate money market and non-interest bearing checking accounts. In addition, yields on loans have declined slowly due to the predominantly fixed rate nature of the portfolio and a change in portfolio mix away from lower earning residential loans in favor of higher earning commercial real estate loans. As a result, the net interest margin as of June 30, 2021, is 3.24%, which is 24 basis points higher than at June 30, 2020.      
  • Net mortgage banking revenues were up $1.6 million for the six months and down $1.2 million for the quarter, compared to the same periods of 2020. The decline in the quarter-end results was primarily due to the exceptional levels of mortgage refinance activity and pricing margins in 2020, and the increase in the six-month results is due to the relative strength of first quarter production in 2021 compared to the same period in 2020. Although mortgage rates are up 25 to 50 basis points from last year, the total origination of mortgage loans for the six months ended June 30, 2021, was $239 million compared to $218 million in the same period of 2020, with the current year production comprised of more purchase money and cash out refinance mortgage loans.
  • Compensation expenses increased $1.2 million for the six-month period compared to the same period last year, primarily due to increased performance-related compensation in the mortgage division.
  • 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 0.29% and 0.19%, respectively, at June 30, 2021, down from 0.54% and 0.23%, respectively, at December 31, 2020, and 1.02% and 0.92%, respectively, at June 30, 2020. The results continue to be near this credit cycle’s best, due in part to fiscal support measures for businesses in certain sectors, the credit resolution of a few large loans, and the sale of OREO property.
  • During the six months ended June 30, 2021, CIBM Bank originated $19 million in round two Paycheck Protection Program (PPP) loans. As of June 30, 2021, CIBM Bank had received $37 million in SBA forgiveness funding for the approximately $43 million in PPP loans originated in 2020; and $1 million of forgiveness for PPP loans originated in 2021. The forgiveness funding rate per loan as a percent of the original loan balance has been 100% to date.
  • Checking account deposits grew by $31.1 million, and savings and money market account deposits grew by $22.2 million, from December 31, 2020 to June 30, 2021, reflecting federal fiscal and monetary policies (e.g., low interest rates and liquidity support programs) as well as ongoing marketing activity results.

Mr. J. Brian Chaffin, CIB Marine’s President and CEO, commented, “Improvements to our cost of funds and higher commercial loan balances have supported strong growth of $1.2 million in our net interest income year-to-date. Solid mortgage origination production is above where it was last year at this time, but the pipeline of loans not yet closed is lower compared to this time in 2020 due in part to the higher interest rates and lower levels of rate refinance activity. SBA lending activity in the first six months of 2021 has again been dominated by PPP loan activity, including originations and forgiveness funding. We have begun to originate SBA 7(a) loans again; up to $3 million may be ready for sale in the second half of 2021 and more production is expected in the future.”     

Noting an increase in deposit balances across the financial industry as a whole, Mr. Chaffin commented, “Total balances in combined checking, savings, and money market products at CIBM Bank increased $99 million over the last 12 months and $53 million the last six months due, in part, to federal economic stimulus policies and programs. We expect these balances to recede in the future as stimulus monies are spent and further when short-term interest rates begin to rise.”  

He also remarked on non-performing loan credit metrics at or near cyclical bests, noting, “We are very pleased with the results, due in part to the diversification of the portfolio by segment and commercial real estate property type. However, we remain cautious about future credit quality in higher risk segments of the portfolio due to the lingering impact of the pandemic. As a result, although down from the prior quarter- and year-end, we continue to have a higher than normal loan loss reserve reflecting, in part, higher environmental factor adjustments.

“Finally, we know our shareholders are anxiously awaiting news on the status of negotiations regarding our plan to repurchase preferred stock. Progress has been slower than expected, but continues. We ask for your patience as we work through the process. If we are able to reach an agreement on a proposal that will benefit all shareholders, we will present it for approval in a new proxy statement. If such an agreement is not possible, we will notify shareholders and the Annual Meeting will proceed as currently scheduled on July 29th,” 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.

















































































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,  
  2021 2021 2020 2020 2020   2021 2020  
  (Dollars in thousands, except share and per share data)  
Selected Statement of Operations Data:                  
Interest and dividend income $ 6,239   $ 6,265   $ 6,489   $ 7,202   $ 6,669     $ 12,504   $ 13,305    
Interest expense   456     536     765     1,017     1,343       992     3,032    
Net interest income   5,783     5,729     5,724     6,185     5,326       11,512     10,273    
Provision for (reversal of) loan losses   (300 )   20     101     501     249       (280 )   451    
Net interest income after provision for                  
(reversal of) loan losses   6,083     5,709     5,623     5,684     5,077       11,792     9,822    
Noninterest income (1)   3,135     5,146     6,566     8,104     4,489       8,281     7,131    
Noninterest expense   7,279     7,940     9,317     9,056     7,308       15,219     13,630    
Income before income taxes   1,939     2,915     2,872     4,732     2,258       4,854     3,323    
Income tax expense   558     798     565     1,322     575       1,356     856    
Net income $ 1,381   $ 2,117   $ 2,307   $ 3,410   $ 1,683       $ 3,498   $ 2,467    
                   
Common Share Data (2):                  
Basic net income per share (3) $ 1.08   $ 1.67   $ 1.82   $ 2.69   $ 1.36     $ 2.74   $ 1.99    
Diluted net income per share (3)   0.63     0.97     1.06     1.56     0.79       1.59     1.16    
Dividend   0.00     0.00     0.00     0.00     0.00       0.00     0.00    
Tangible book value per share (4)   54.19     53.25     52.28     50.35     47.25       54.19     47.25    
Book value per share (4)   49.16     48.21     47.19     45.27     42.00       49.16     42.00    
Weighted average shares outstanding – basic   1,282,917     1,268,947     1,267,584     1,267,582     1,266,174       1,275,971     1,257,224    
Weighted average shares outstanding – diluted   2,208,600     2,185,433     2,181,142     2,181,868     2,160,201       2,197,071     2,155,394    
Financial Condition Data:                  
Total assets $ 753,660   $ 752,715   $ 750,982   $ 793,604   $ 793,151     $ 753,660   $ 793,151    
Loans   553,642     540,206     539,227     546,351     535,692       553,642     535,692    
Allowance for loan losses   (9,165 )   (9,253 )   (9,122 )   (9,037 )   (8,483 )     (9,165 )   (8,483 )  
Investment securities   108,825     112,400     108,492     107,351     113,303       108,825     113,303    
Deposits   609,964     608,433     586,373     593,370     566,811       609,964     566,811    
Borrowings   29,592     30,736     51,310     87,994     120,233       29,592     120,233    
Stockholders’ equity   107,051     105,593     103,704     101,271     97,347       107,051     97,347    
Financial Ratios and Other Data:                  
Performance Ratios:                  
Net interest margin (5)   3.26 %   3.23 %   3.14 %   3.30 %   2.96 %     3.24 %   3.00 %  
Net interest spread (6)   3.16 %   3.13 %   3.01 %   3.16 %   2.76 %     3.15 %   2.77 %  
Noninterest income to average assets (7)   1.68 %   2.79 %   3.43 %   4.12 %   2.36 %     2.24 %   1.95 %  
Noninterest expense to average assets   3.91 %   4.27 %   4.86 %   4.60 %   3.86 %     4.09 %   3.77 %  
Efficiency ratio (8)   81.69 %   72.72 %   75.77 %   63.38 %   74.61 %     76.75 %   78.58 %  
Earnings on average assets (9)   0.74 %   1.14 %   1.20 %   1.73 %   0.89 %     0.94 %   0.68 %  
Earnings on average equity (10)   5.18 %   8.10 %   8.83 %   13.51 %   6.97 %     6.62 %   5.17 %  
Asset Quality Ratios:                  
Nonaccrual loans to loans (11)   0.19 %   0.23 %   0.23 %   0.32 %   0.92 %     0.19 %   0.92 %  
Nonaccrual loans, restructured loans and                  
 loans 90 days or more past due and still                  
 accruing to total loans (11)   0.32 %   0.37 %   0.40 %   0.49 %   1.07 %     0.32 %   1.07 %  
Nonperforming assets, restructured loans                  
and loans 90 days or more past due and still                  
accruing to total assets (11)   0.29 %   0.52 %   0.54 %   0.60 %   1.02 %     0.29 %   1.02 %  
Allowance for loan losses to total loans (11)   1.66 %   1.71 %   1.69 %   1.65 %   1.58 %     1.66 %   1.58 %  
Allowance for loan losses to nonaccrual loans,                  
restructured loans and loans 90 days or                  
more past due and still accruing (11)   519.26 %   459.21 %   421.14 %   338.59 %   147.79 %     519.26 %   147.79 %  
Net charge-offs (recoveries) annualized                  
to average loans (11)   -0.16 %   -0.08 %   0.01 %   -0.04 %   -0.09 %     -0.12 %   -0.01 %  
Capital Ratios:                  
Total equity to total assets   14.20 %   14.03 %   13.81 %   12.76 %   12.27 %     14.20 %   12.27 %  
Total risk-based capital ratio   18.02 %   18.15 %   17.44 %   16.13 %   15.49 %     18.02 %   15.49 %  
Tier 1 risk-based capital ratio   16.76 %   16.89 %   16.19 %   14.87 %   14.23 %     16.76 %   14.23 %  
Leverage capital ratio   12.19 %   11.88 %   11.46 %   11.20 %   10.82 %     12.19 %   10.82 %  
Other Data:                  
Number of employees (full-time equivalent)   176     179     176     176     177       176     177    
Number of banking facilities   10     10     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)  
             
  June 30, March 31, December 31, September 30, June 30,  
  2021 2021 2020 2020 2020  
  (Dollars in Thousands, Except Shares)  
Assets            
Cash and due from banks $ 52,467   $ 51,691   $ 29,927   $ 30,544   $ 9,120    
Reverse repurchase agreements               8,208     18,117    
Securities available for sale   106,383     109,965     106,014     104,866     110,818    
Equity securities at fair value   2,442     2,435     2,478     2,485     2,485    
Loans held for sale   13,168     18,136     42,977     67,496     83,997    
             
Loans   553,642     540,206     539,227     546,351     535,692    
Allowance for loan losses   (9,165 )   (9,253 )   (9,122 )   (9,037 )   (8,483 )  
Net loans   544,477     530,953     530,105     537,314     527,209    
             
Federal Home Loan Bank Stock   3,140     3,140     3,140     3,140     2,948    
Premises and equipment, net   3,873     4,476     4,682     4,667     4,679    
Accrued interest receivable   1,916     1,983     2,050     2,075     1,973    
Deferred tax assets, net   15,632     16,417     16,292     18,547     19,325    
Other real estate owned, net   403     1,875     1,875     2,103     2,334    
Bank owned life insurance   4,861     4,831     4,802     4,774     4,745    
Goodwill and other intangible assets   120     126     131     137     142    
Other assets   4,778     6,687     6,509     7,248     5,259    
Total Assets $ 753,660   $ 752,715   $ 750,982   $ 793,604   $ 793,151    
             
Liabilities and Stockholders’ Equity            
Deposits:            
Noninterest-bearing demand $ 121,862   $ 109,466   $ 92,544   $ 91,134   $ 90,450    
Interest-bearing demand   61,439     63,033     59,679     61,262     54,288    
Savings   266,085     268,026     243,888     225,724     205,470    
Time   160,578     167,908     190,262     215,250     216,603    
Total deposits   609,964     608,433     586,373     593,370     566,811    
Short-term borrowings   29,592     30,736     51,310     54,052     77,273    
Long-term borrowings               33,942     42,960    
Accrued interest payable   127     140     246     398     447    
Other liabilities   6,926     7,813     9,349     10,571     8,313    
Total liabilities   646,609     647,122     647,278     692,333     695,804    
             
Stockholders’ Equity            
Preferred stock, $1 par value; 5,000,000 authorized shares at both June 30, 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     37,308    
Common stock, $1 par value; 75,000,000 authorized shares; 1,299,553 and 1,285,385 issued shares;
1,285,484 and 1,268,316 outstanding shares at June 30, 2021 and December 31, 2020, respectively. (1)(2)
  1,301     1,295     1,282     1,282     19,240    
Capital surplus (2)   179,421     179,291     179,188     179,090     161,032    
Accumulated deficit   (112,071 )   (113,452 )   (115,569 )   (117,875 )   (121,285 )  
Accumulated other comprehensive income, net   1,626     1,685     2,029     2,000     1,586    
Treasury stock, 14,791 shares on June 30, 2021 and December 31, 2020 and 221,902 shares prior at cost (2)   (534 )   (534 )   (534 )   (534 )   (534 )  
Total stockholders’ equity   107,051     105,593     103,704     101,271     97,347    
Total liabilities and stockholders’ equity $ 753,660   $ 752,715   $ 750,982   $ 793,604   $ 793,151    
             
(1) Both issued and outstanding shares as stated here exclude 70,206 shares of unvested restricted stock awards at June 30, 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   6 Months Ended  
  June 30, March 31, December 31, September 30, June 30,   June 30, June 30,  
  2021 2021 2020 2020 2020   2021 2020  
  (Dollars in thousands)  
                   
Interest Income                  
Loans $ 5,583   $ 5,524   $ 5,577   $ 6,054   $ 5,540   $ 11,107   $ 11,243    
Loans held for sale   95     175     331     537     451     270     570    
Securities   551     555     564     573     661     1,106     1,424    
Other investments   10     11     17     38     17     21     68    
Total interest income   6,239     6,265     6,489     7,202     6,669     12,504     13,305    
                   
Interest Expense                  
Deposits   447     512     735     942     1,263     959     2,775    
Short-term borrowings   9     24     30     38     54     33     231    
Long-term borrowings   0     0     0     37     26     0     26    
Total interest expense   456     536     765     1,017     1,343     992     3,032    
Net interest income   5,783     5,729     5,724     6,185     5,326     11,512     10,273    
Provision for (reversal of) loan losses   (300 )   20     101     501     249     (280 )   451    
Net interest income after provision for                  
(reversal of) loan losses   6,083     5,709     5,623     5,684     5,077     11,792     9,822    
                   
Noninterest Income                  
Deposit service charges   90     84     91     89     88     174     184    
Other service fees   43     40     37     36     36     83     56    
Mortgage banking revenue, net   2,763     4,983     6,387     7,741     3,990     7,746     6,167    
Other income   280     192     165     226     266     472     531    
Net gains on sale of securities available for sale   0     0     0     0     0     0     0    
Unrealized gains (losses) recognized on equity securities   7     (43 )   (6 )   0     20     (36 )   59    
Net gains (loss) on sale of SBA loans   0     0     55     (55 )   87     0     524    
Net gains (losses) on sale of assets and (writedowns)   (48 )   (110 )   (163 )   67     2     (158 )   (390 )  
Total noninterest income   3,135     5,146     6,566     8,104     4,489     8,281     7,131    
                   
Noninterest Expense                  
Compensation and employee benefits   5,099     5,956     7,015     7,329     5,451     11,055     9,872    
Equipment   384     379     402     352     379     763     742    
Occupancy and premises   443     434     452     390     407     877     867    
Data Processing   181     185     178     177     155     366     319    
Federal deposit insurance   47     48     49     48     47     95     47    
Professional services   328     253     322     162     242     581     540    
Telephone and data communication   56     60     82     71     67     116     135    
Insurance   64     68     62     58     55     132     109    
Other expense   677     557     755     469     505     1,234     999    
Total noninterest expense   7,279     7,940     9,317     9,056     7,308     15,219     13,630    
Income from operations                  
before income taxes   1,939     2,915     2,872     4,732     2,258     4,854     3,323    
Income tax expense   558     798     565     1,322     575     1,356     856    
Net income   1,381     2,117     2,307     3,410     1,683     3,498     2,467    
Preferred stock dividend   0     0     0     0     0     0     0    
Discount from repurchase of preferred stock   0     0     0     33     0     0     0    
Net income allocated to                  
 common stockholders $ 1,381   $ 2,117   $ 2,307   $ 3,443   $ 1,683   $ 3,498   $ 2,467    

 

FOR INFORMATION CONTACT:
J. Brian Chaffin, President & CEO
(217) 355-0900
[email protected]





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