CIB Marine Bancshares, Inc. (OTCQB: CIBH) recently filed with the federal banking regulators its quarterly
regulatory financial reports through the first three months of 2013. CIB Marine and its subsidiary CIBM Bank
both reported earnings , improved capital ratios and other positive trends for the quarter.
Results of Operations - Summary
Earnings from operations for the first quarter of 2013 were $34,000 compared to a loss of $111,000 for the same
period of 2012. Both basic and diluted net incomes per share of common stock were nominal compared to a loss
per share of $0.01 for the same period of 2012.
? The improvement in earnings was primarily related to lower noninterest expense and improved noninterest
income more than offsetting a decline in net interest income.
? Net interest income declined by $1.0 million from $4.8 million in the first quarter of 2012 to $3.8 million in
the same period of 2013. The decline was primarily the result of a decline in yields on earning assets of 76
basis points versus a 21 basis point decline in the cost of interest bearing liabilities. The decline in earning
asset yields was a result of declines in the yields for both loan and securities.
? Noninterest income increased $0.7 million during the first quarter of 2013 compared to the same period in
2012 from a loss of $0.3 million during the first quarter of 2012 to income of $0.4 million in the same
period of 2013. The improvement was primarily related to net gains on securities and other real estate
owned in the first quarter of 2013 compared to other-than-temporary impairment from securities and losses
in other real estate owned in the first quarter of 2012.
? Noninterest expense improved $0.5 million during the first quarter of 2013 compared to the same period in
2012 from $4.6 million during the first quarter of 2012 to $4.1 million in the same period of 2013. The
decline was primarily the result of lower federal deposit insurance and reduced professional service
expenses, but also lower expenses for compensation and employee benefits, insurance and occupancy.
Financial Condition - Summary
During the first three months of 2013, CIB Marine showed improvement compared to one year ago in certain key
asset quality and capital measures. In addition to stronger regulatory capital ratios, the book value per share of
common stock was $0.42 at March 31, 2013, compared to $0.29 at March 31, 2012. Total assets have declined by
$33 million over the same time period, primarily the result of reductions in loan portfolio balances, some of which
were lower quality assets.
? The March 31, 2013, Tier 1 leverage ratio for CIB Marine improved to 14.67% from 13.49% at March 31,
2012 and 14.39% at December 31, 2012.
? Non-accrual loans were $11.4 million at March 31, 2013, an improvement from the $15.5 million reported
at March 31, 2012, but up from the $8.9 million reported at December 31, 2012. Other real estate owned
was $10.4 million compared to $8.0 million reported at March 31, 2012, and $10.5 million at December 31,
2012.
? Net charge-offs annualized to average loans increased to 2.81% during the first quarter of 2013, compared
to 0.12% during the same period of 2012. The rise in net charge-offs was primarily the result of a few
commercial real estate loan charge-offs during the first quarter of 2013 compared to significant recoveries
of previously charged off purchased home equity and commercial real estate loans during the first quarter of
2012.
regulatory financial reports through the first three months of 2013. CIB Marine and its subsidiary CIBM Bank
both reported earnings , improved capital ratios and other positive trends for the quarter.
Results of Operations - Summary
Earnings from operations for the first quarter of 2013 were $34,000 compared to a loss of $111,000 for the same
period of 2012. Both basic and diluted net incomes per share of common stock were nominal compared to a loss
per share of $0.01 for the same period of 2012.
? The improvement in earnings was primarily related to lower noninterest expense and improved noninterest
income more than offsetting a decline in net interest income.
? Net interest income declined by $1.0 million from $4.8 million in the first quarter of 2012 to $3.8 million in
the same period of 2013. The decline was primarily the result of a decline in yields on earning assets of 76
basis points versus a 21 basis point decline in the cost of interest bearing liabilities. The decline in earning
asset yields was a result of declines in the yields for both loan and securities.
? Noninterest income increased $0.7 million during the first quarter of 2013 compared to the same period in
2012 from a loss of $0.3 million during the first quarter of 2012 to income of $0.4 million in the same
period of 2013. The improvement was primarily related to net gains on securities and other real estate
owned in the first quarter of 2013 compared to other-than-temporary impairment from securities and losses
in other real estate owned in the first quarter of 2012.
? Noninterest expense improved $0.5 million during the first quarter of 2013 compared to the same period in
2012 from $4.6 million during the first quarter of 2012 to $4.1 million in the same period of 2013. The
decline was primarily the result of lower federal deposit insurance and reduced professional service
expenses, but also lower expenses for compensation and employee benefits, insurance and occupancy.
Financial Condition - Summary
During the first three months of 2013, CIB Marine showed improvement compared to one year ago in certain key
asset quality and capital measures. In addition to stronger regulatory capital ratios, the book value per share of
common stock was $0.42 at March 31, 2013, compared to $0.29 at March 31, 2012. Total assets have declined by
$33 million over the same time period, primarily the result of reductions in loan portfolio balances, some of which
were lower quality assets.
? The March 31, 2013, Tier 1 leverage ratio for CIB Marine improved to 14.67% from 13.49% at March 31,
2012 and 14.39% at December 31, 2012.
? Non-accrual loans were $11.4 million at March 31, 2013, an improvement from the $15.5 million reported
at March 31, 2012, but up from the $8.9 million reported at December 31, 2012. Other real estate owned
was $10.4 million compared to $8.0 million reported at March 31, 2012, and $10.5 million at December 31,
2012.
? Net charge-offs annualized to average loans increased to 2.81% during the first quarter of 2013, compared
to 0.12% during the same period of 2012. The rise in net charge-offs was primarily the result of a few
commercial real estate loan charge-offs during the first quarter of 2013 compared to significant recoveries
of previously charged off purchased home equity and commercial real estate loans during the first quarter of
2012.
