CIB Marine Bancshares, Inc. Announces 2018 Third Quarter Results

BROOKFIELD, Wis., Oct. 11, 2018 (GLOBE NEWSWIRE) -- CIB Marine Bancshares, Inc. (the “Company” or “CIBM”) (OTCQB: CIBH), the holding company of CIBM Bank (the “Bank”), today announces its results of operations and financial condition for the third quarter of 2018.  Pre-tax net income for the quarter was $1.2 million, the same as the third quarter in 2017, and for the nine months ending September 30, 2018, it was $3.3 million compared to $3.1 million for the same period in 2018.

A summary of financial results for the quarter and nine months ended September 30, 2018, is attached.  Selected highlights include:

• Pre-tax net income for subsidiary CIBM Bank was $1.7 million for the quarter compared to $1.3 million for the same period in 2017, and $4.2 million for the nine months ending September 30, 2018, compared to $3.6 million for the same period in 2017.  The Company saw improved business activity across all of our major lines of business.
• The net interest margin was reported at 3.10% for the nine months ending September 30, 2018, compared to 3.06% for the same period in 2017.  Net interest income was up $0.5 million year to date compared to the same period of 2017, due to higher average earning asset balances and a higher net interest margin.  The 2.97% net interest margin for the quarter ended September 30, 2018, was 10 basis points lower than in the same period of 2017 due primarily to a $22 million increase in average balances of reverse repurchase agreements, which added net interest income but lowered the net interest margin due to its lower spread.
• Non-interest income improved $1.1 million for the nine months ending September 30, 2018, compared to the same period in 2017, largely reflecting higher gains on the sale of SBA loans and net mortgage banking revenues. 
• Non-interest expenses were higher by $1.9 million for the nine months ending September 30, 2018, compared to the same period in 2017, due primarily to higher compensation and professional fees.  The latter is due mostly to expenses related to the amendment to the Articles of Incorporation that occurred earlier this year and activities associated with the repurchase of preferred shares by the Company. 
• Non-performing assets to total assets was 1.11% at September 30, 2018, compared to 1.13% at December 31, 2017, and 1.49% at September 30,  2017, reflecting lower non-accrual loans and other real estate owned.
• Book and tangible book value per share of common stock improved to $2.34 and $2.71, respectively, for September 30, 2018, compared to $2.04 and $2.53 at December 31, 2017. 
• During 2018, the carry value of preferred stock has declined $11.6 million due to repurchases of preferred stock resulting in $1.8 million being transferred to additional paid in capital through September 30, 2018.  Whereas most of the repurchase transactions have cash settled, a liability has been established for those not yet settled but expect to be in the future. 

J. Brian Chaffin, CIB Marine’s President and CEO, commented, “The third quarter results reflect improvements in all of our major business areas.  We had a strong production quarter for our commercial loan portfolio with outstanding balances rising $19 million over the last 3 months, and our SBA and residential loan production are both up year to date and had solid third quarters.” 

Mr. Chaffin added, “Although rising interest rates and the related increased business activity in the economy have been welcome, it has created other kinds of challenges - as banking industry loan growth has increased the competition for new deposits coupled with higher short term interest rates has caused funding costs to rise.  At the same time, asset quality ratios continue to reflect a strong economy with low unemployment and generally higher asset prices in real estate and equity.  Coupled with a solid loan loss reserve at 1.62%, we have had lower provisions to loan loss reserves year to date.  We are also happy to report that after September 30, 2018, the company received a $1.0 million recovery on a loan that was charged-off more than five years ago.  This event is not reflected in the results for the third quarter and will be reported in our fourth quarter financial results.”

CIB Marine Bancshares, Inc. owns and operates CIBM Bank, an Illinois chartered commercial bank, headquartered in Champaign, Illinois, which operates as “Marine Bank” in its Indiana and Wisconsin markets; “Central Illinois Bank” in its central Illinois market; and “Avenue Bank” in its Chicagoland market.  The Avenue Mortgage Division of the bank, headquartered in Naperville, Illinois, serves all CIBM Bank markets.  CIBM Bank operates eleven banking branches and nine mortgage lending offices. 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.