MILLERSBURG, Ohio -- (Business Wire)

CSB Bancorp, Inc. (OTCBB: CSBB):

CSB Bancorp, Inc. (CSBB) today announced fourth quarter 2014 net income of $1,439,000 or $.53 per basic and diluted share, as compared to $1,224,000 or $.45 per basic and diluted share for the same period in 2013.

Annualized returns on average common equity (“ROE”) and average assets (“ROA”) for the quarter were 9.99% and 0.92%, respectively, compared with 9.19% and 0.82% for the fourth quarter of 2013.

For the full year of 2014, the Company reported net income of $5.9 million or $2.15 per basic and diluted share, as compared to $5.2 million or $1.91 per basic and diluted share in 2013. Full year ROE and ROA were 10.60% and 0.97%, respectively, compared to 9.93% and 0.90% in 2013.

Eddie Steiner, President and CEO commented, “Economic conditions for businesses and households continue to improve across the markets we serve. Loan demand softened in our commercial markets during the most recent quarter, with loan growth increases continuing within the retail loan products. The very low interest rate environment continues to affect margins on earning assets. All things considered, we are pleased with our progress in financial results for the quarter and the year as a whole.”

Revenue, on a fully-taxable equivalent basis, totaled $6.1 million during the quarter, a 2% increase from the prior-year fourth quarter. Net interest income improved by $65 thousand as compared to fourth quarter 2013, while other income increased $37 thousand attributable primarily to an increase in debit card interchange fees. Full year revenue of $24.5 million reflects a $954 thousand, or a 4%, increase as compared to full year 2013.

Non-interest expense amounted to $3.8 million during the quarter, a decrease of $205 thousand or 5% from fourth quarter 2013. The Company’s fourth quarter efficiency ratio amounted to 61.3% as compared to 65.7% for the same quarter in the prior year. For the full year ended December 31, 2014, non-interest expense increased $234 thousand or 2% versus 2013, with the majority of the change attributable to increases in other expenses which were partially offset by a decrease in the new Ohio Financial Institutions tax that replaced the Ohio Franchise tax.

Net interest margin amounted to 3.43% for the quarter compared to 3.55% for the prior year’s fourth quarter. The margin decrease resulted from recognition of a purchase discount on a loan that paid off early in December 2013 resulting in a 0.13% favorable margin impact in the prior year quarter that did not recur during fourth quarter 2014. The net interest margin amounted to 3.56% for the full year in 2014 as compared to 3.51% for the prior full year. The margin increase on a year over year basis can be attributed to decreased interest rates on all liabilities and increased average loan and investment volumes.

Federal income tax provision totaled $637 thousand in fourth quarter 2014, compared to $520 thousand for the same quarter in 2013 reflecting an effective tax rate of 31% for current quarter versus 30% for the fourth quarter in 2013.

Average total assets during the quarter amounted to $622 million, an increase of $27 million or 5% above the same quarter of the prior year. Average loan balances of $409 million were $33 million or 9% above prior year fourth quarter, while average securities balances of $144 million decreased $2.9 million or 2% as compared to fourth quarter 2013.

Average commercial loan balances for the quarter, including commercial real estate, increased $27 million or 11% above year ago levels. Average residential mortgage balances increased by $9 million or 13% over the prior year’s quarter. The increase of mortgage balances was the result of the bank originating and retaining some 15 year fixed rate mortgages. Average home equity balances decreased $919 thousand or 2%, and average consumer credit balances increased $1 million or 14% versus the same quarter of the prior year.

Nonperforming assets totaled $3.9 million or 0.96% of total loans plus other real estate, a decrease from the $4.7 million or 1.14% of total loans plus other real estate at September 30, 2014. During first quarter 2014 a $2.9 million commercial relationship was placed on nonaccrual with an assigned specific reserve. The aforementioned commercial relationship was charged-down to estimated secured value during fourth quarter 2014. The charge-down of this single commercial relationship accounts for the reduction in nonperforming assets during the quarter. Delinquent loan balances as of December 31, 2014 amounted to 1.30% of total loans as compared to 1.26% at December 31, 2013.

Net loan charge-offs during fourth quarter 2014, as explained above, were $992 thousand compared to fourth quarter 2013 net loan charge-offs of $202 thousand. Net charge-offs for the twelve month period in 2014 amounted to 0.33% as compared to 0.09% of average loans for the twelve month period in 2013.

The Company funded $185 thousand in loan loss provision during the fourth quarter and the allowance for loan losses amounted to 1.07% of total loans on December 31, 2014. The ratio of the allowance for loan losses to nonperforming loans stood at 110.9% at December 31, 2014.

Average deposit balances grew by $17 million, or 4%, from the prior year’s fourth quarter. Average deposit balances for fourth quarter 2014 totaled $497 million. Within the deposit category, average noninterest-bearing account balances for the fourth quarter increased by $18 million, or 15% above the same period in the prior year. Average interest-bearing checking, money market and traditional savings balances increased $12 million or 5% from year ago levels, while average time deposit balances decreased $12 million or 9% during the year. In addition to the changes in average deposit balances, the average balance of securities sold under repurchase agreement during the fourth quarter grew by $2 million or 4% above the average for the same period in the prior year. The repurchase agreements, while considered short-term borrowings, are primarily tied to overnight customer sweep accounts.

Shareholders’ equity totaled $57.1 million on December 31, 2014 with 2.7 million common shares outstanding. The tangible equity to assets ratio amounted to 8.5% on December 31, 2014, as compared to 7.9% on December 31, 2013. The Company declared a common dividend of $.19 per share during the quarter. Based on the December 31, 2014 closing stock price of $22.00 per share, the Company’s annual dividend yield approximates 3.5%.

About CSB Bancorp, Inc.

CSB is a financial holding company headquartered in Millersburg, Ohio, with approximate assets of $622 million as of December 31, 2014. CSB provides a complete range of banking and other financial services to consumers and businesses through its wholly owned subsidiary, The Commercial and Savings Bank, with sixteen banking centers in Holmes, Wayne, Tuscarawas and Stark counties and Trust offices located in Millersburg and Wooster, Ohio.

Forward-Looking Statement

This release contains forward-looking statements relating to present or future trends or factors affecting the banking industry, and specifically the financial condition and results of operations, including without limitation, statements relating to the earnings outlook of the Company, as well as its operations, markets and products. Actual results could differ materially from those indicated. Among the important factors that could cause results to differ materially are interest rate changes, softening in the economy, which could materially impact credit quality trends and the ability to generate loans, changes in the mix of the Company’s business, competitive pressures, changes in accounting, tax or regulatory practices or requirements and those risk factors detailed in the Company’s periodic reports and registration statements filed with the Securities and Exchange Commission. The Company undertakes no obligation to release revisions to these forward-looking statements or reflect events or circumstances after the date of this release.

Contacts:

CSB Bancorp, Inc.
Paula J. Meiler, SVP & CFO
330-763-2873
paula.meiler@csb1.com

Source: CSB Bancorp, Inc.