Camco Financial Announces Fourth Quarter and Full-Year 2012 Earnings

Camco Financial Announces Fourth Quarter and Full-Year 2012 Earnings

CAMBRIDGE, Ohio, Jan. 31, 2013 (GLOBE NEWSWIRE) -- Camco Financial Corporation
(Nasdaq:CAFI), the bank holding company for Advantage Bank, today announced
financial results for the three months and twelve months ended December 31,
2012. Net earnings increased to $2.8 million or $0.26 per diluted share for
the fourth quarter 2012 from $0.9 million or $.12 per diluted share for the
same period of the prior year. For the full-year 2012, net earnings were $4.2
million or $0.50 per diluted share compared with $0.2 million or $0.03 per
diluted share for 2011.

Jim Huston, President and CEO, commented, "Our fourth quarter and full-year
2012 financial statements reflect solid achievements in key areas that further
strengthened our balance sheet. In addition to our solid operating results, we
successfully completed a $10.0 million rights and public offering in November,
2012. Those two factors enabled us to end the year 2012 with approximately
$60.0 million in stockholders' equity. This represents Tier 1 equity of 8.42%
of total assets compared to 6.56% at December 31, 2011. We continue to
implement plans to improve our long-term performance through rigorous
attention to net interest margin coupled with opportunities to increase
noninterest income while also reducing noninterest expense. We exited 2012
stronger than we entered the year and anticipate attaining further progress in
2013."

Review of Financial Performance

Overview:

The following items summarize key achievements of the Company during the
fourth quarter and fiscal year 2012:

Fourth Quarter 2012

  *The Company successfully raised $10.0 million of capital through a
    shareholder rights and public offering in November 2012, which resulted in
    the issuance of 5.7 million shares of common stock.
  *Net interest margin decreased 0.04% from the linked quarter, principally
    due to lower yield on earning assets.
  *Noninterest income increased $0.6 million from the linked quarter and $1.2
    million from the fourth quarter 2011, driven by higher gain on sale of
    loans and higher loan fee income, along with improvement in the value of
    mortgage servicing rights, offset partially by decreased gain on sale of
    investments.
  *Noninterest expense decreased $0.6 million compared to the same quarter
    ended December 31, 2011, primarily due to lower expenses related to real
    estate owned.
  *Classified loans (which includes substandard, doubtful, and loss) at
    December 31, 2012 were $3.4 million below the linked quarter.
  *A charge-off of $0.6 million for Other Real Estate Owned was recorded due
    to deterioration of real estate values.

Full-Year 2012

  *Core deposits (defined as checking, savings, and money market deposits)
    increased $39.1 million, or 13.8%, in 2012 compared to the same date of
    the prior year.
  *Net interest margin decreased 0.25% to 3.41% for the full-year 2012
    compared to a year ago, primarily due to lower yield on earning assets.
    Cost of funds for the full-year 2012 was 33 basis points below 2011.
  *Classified loans at December 31, 2012 were $11.6 million below the same
    date of the prior year.
  *Tier 1 equity at December 31, 2012 was 8.42% compared to 6.56% at December
    31, 2011, an increase of 186 basis points.
  *Noninterest income increased $1.5 million compared to a year ago, driven
    by higher gain on sale of loans and higher loan fee income, along with
    improvement in the value of mortgage servicing rights, offset partially by
    decreased gain on sale of investments.
  *Noninterest expense decreased $1.7 million compared to 2011, primarily due
    to lower expenses related to real estate owned.

Net Interest Margin:

Net interest margin decreased to 3.36% for the fourth quarter 2012 compared to
3.49% for the third quarter 2012. For the full-year 2012, net interest margin
decreased 0.25% from 3.66% for 2011, driven by a reduction in the bank's yield
on earning assets in this low rate environment.Management expects the
Company's net interest margin to remain relatively stable during this
periodof low interest rates and slow economic growth, but will continue to
seek opportunities for more favorable pricing, further improvement in credit
quality, and other ways to maintain net interest margin going forward.

Net Interest Income:

Net interest income before the provision for loan losses decreased $0.2
million, or 3.0%, to $5.8 million for the fourth quarter 2012 compared to the
linked quarter. The decrease was attributable to reductions in yield on
earning assets in this low rate environment.

The Company's yield on earning assets decreasedto 4.35% in the fourth quarter
2012 compared to 4.52% in the linked quarter.The cost of funds was similar
for the quarter ended December 31, 2012 at 1.10% compared to 1.12% for the
linked quarter 2012 and 1.42% for the fourth quarter 2011.Favorable growth in
core deposits partially offset planned run-off in certificates of deposits and
borrowings.

Provision Expense and Allowance for Loan Losses:

The allowance for loan and lease losses was $12.1 million at December 31,
2012, compared to $14.5 million at December 31, 2011.Factors contributing to
this year-over-year improvement included lower classified and non-performing
loans, and overall improvement in credit quality.Classified loans (which
includes substandard, doubtful, and loss) decreased $3.4 million, or 11%, from
the linked quarter in 2012 and $11.6 million, or 28.7%, compared to December
31, 2011.Non-performing loans of $19.6 million at December 31, 2012 were $3.2
million, or 14.0%, below September 30, 2012 and $5.3 million, or 21.3%, lower
than December 31, 2011.Non-performing loans as a percentage of total loans
(including loans held for sale) has decreased to 3.42% at December 21, 2012,
compared to 3.77% on the same date of the prior year.The allowance for loan
and lease losses as a percentage of non-performing loans was 62.0% at December
31, 2012 compared to 58.3% at December 31, 2011.

Noninterest Income:

Noninterest income was $2.5 million for the fourth quarter 2012, an increase
of $0.6 million, or 34.5%, compared to the linked quarter.Noninterest income
for the full-year 2012 was $8.0 million, an increase of $1.5 million, or
23.1%, above the full-year 2011.The increase in noninterest income in the
fourth quarter 2012 over the linked quarter and full-year year 2011 was
primarily driven by higher gain on sale of residential mortgage loan
production and improvement in the value of mortgage servicing rights.

Noninterest Expense:

Noninterest expense for the quarter ended December 31, 2012, decreased $0.6
million, or 7.4%, to $6.9 million from the same period of 2011 and was similar
compared to the linked quarter.The decrease in noninterest expense compared
to the fourth quarter 2011was driven by lower expenses related to real estate
owned.

Balance Sheet:

Total assets were $764.3 million at December 31, 2012, compared to $767.0
million on the same date in 2011. The quality of the balance sheet continued
to improve during 2012 as the Company increased equity capital by $14.1
million and core deposits by $39.1 million, while reducing higher-cost
certificates of deposit and borrowings by $57.2 million.These achievements
resulted from the Company's focus on strengthening the balance sheet,
including a reduction in non-core funding.

Asset Quality:

Loan quality improved throughout 2012 even though the economic recovery within
the Company's markets continues to be sluggish, contributing to declines in
the underlying value of collateral of commercial and residential real estate
plus deterioration in the financial condition of some borrowers.

A summary of certain key factors follows:

                                                        
(in thousands)                    12/31/2012   9/30/2012   12/31/2011
Classified Loans*                 $ 28,995     $ 32,413    $ 40,641
Non-Performing Loans              $ 19,594     $ 22,787    $ 24,918
Loan Loss Reserve                 $ 12,147     $ 14,508    $ 14,532
Loan Loss Reserve / Total Loans   2.12%        2.44%       2.20%
                                                        
*Includes substandard, doubtful and loss (including homogeneous loans).

Deposits and Borrowings:

Core deposits (defined as checking, savings, and money market deposits) were
$39.1 million, or 13.8%, higher on December 31, 2012, compared to the same
date of the prior year.Total deposits were $627.2 million at December 31,
2012, which is slightly lower compared to the same date in 2011.This slight
year-over-year decrease in total deposits was due to a reduction in
certificates of deposit of $41.1 million. The Company plans to continue to
reduce non-core deposits, particularly higher single product certificates of
deposit related to rate-sensitive customers.

FHLB advances and other borrowings were $16.1 million, or 20.0%, lower at
December 31, 2012 compared to December 31, 2011.This planned decrease
resulted from further repayment and restructuring of FHLB advances with excess
liquidity, as well as a reduction in the amount of repurchase agreements.

Equity:

Stockholders' equity increased $14.1 million, or 31.0%, during 2012 to $59.7
million at December 31, 2012, compared to $45.6 million at December 31,
2011.This was due to the improvement in net earnings throughout 2012 and the
successful completion of a shareholder rights offering and public offering in
November 2012 that resulted in $10.0 million of additional equity
capital.Camco's Tier 1 leverage capital ratio was 8.42% at December 31, 2012
compared to 6.56% on the same date in 2011.

About Camco Financial Corporation: Camco Financial Corporation, holding
company for Advantage Bank, is a multi-state bank holding company
headquartered in Cambridge, Ohio.Advantage Bank and its affiliates offer
community banking that includes commercial, business and consumer financial
services and internet banking from 22 offices. Additional information about
Camco Financial may be found on the Company's web sites: 
www.camcofinancial.com or www.advantagebank.com.

The Camco Financial Corporation logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=4639

The words or phrases "will likely result," "are expected to," "will continue,"
"is anticipated," "estimate," "project" or similar expressions are intended to
identify "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995.Such statements are subject to
certain risks and uncertainties including changes in economic conditions in
the Company's market area, changes in policies by regulatory agencies,
fluctuations in interest rates, demands for loans in the Company's market area
and competition, that could cause actual results to differ materially from
historical earnings and those presently anticipated or projected.The Company
wishes to caution readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date made. The Company
does not undertake, and specifically disclaims any obligation, to publicly
release the result of any revisions that may be made to any forward-looking
statements to reflect events or circumstances after the date of such
statements or to reflect the occurrence of anticipated or unanticipated
events.

Camco Financial Corporation
Condensed Consolidated Statements of Financial Condition
(In thousands, except for per share data and shares outstanding)
                                                              
                                                              
                  (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
                  12/31/12    9/30/12     6/30/12     3/31/12     12/31/11
Assets                                                         
Cash and Cash      58,379     26,920     28,160     40,431     38,374
Equivalents
Investments        86,201     80,648     75,347     62,834     20,928
                                                              
Loans Held for     6,544      6,341      2,532      5,583      8,090
Sale
                                                              
Loans Receivable   566,722    594,030    613,790    630,124    653,709
Allowance for Loan (12,147)    (14,508)    (14,185)    (14,954)    (14,532)
Loss
Loans Receivable,  554,575    579,522    599,605    615,170    639,177
Net
                                                              
Other Assets       58,560      60,811      61,272      62,149      60,449
                                                              
Total Assets       $764,259  $754,242  $766,916  $786,167  $767,018
                                                              
Liabilities                                                    
Deposits           627,224    630,304    638,516    650,853    629,259
Borrowed Funds     64,219     64,466     69,200     77,929     80,285
Other Liabilities  13,089      12,050      12,424      11,276      11,869
                                                              
Total Liabilities  704,532    706,820    720,140    740,058    721,413
                                                              
Stockholders'      59,727      47,422      46,776      46,109      45,605
Equity
                                                              
Total Liabilities
and Stockholders'  $764,259  $754,242  $766,916  $786,167  $767,018
Equity
                                                              
                                                              
Stockholders'
Equity to Total    7.82%       6.29%       6.10%       5.87%       5.95%
Assets
                                                              
Total Shares       13,233,036 7,465,563  7,468,087  7,468,087  7,205,595
Outstanding
                                                              
Book Value Per     $ 4.51      $ 6.35      $ 6.26      $ 6.17      $ 6.33
Share




Camco Financial Corporation
Condensed Consolidated Statements of Earnings
Year to Date Information
(In thousands, except for per share data and shares outstanding)
                                                                
                                                     12 Months   12 Months
                                                     Ended       Ended
                                                     12/31/12    12/31/11
                                                     (Unaudited) (Unaudited)
Interest Income:                                                 
Loans                                                 30,674     34,956
Mortgage-backed securities                            63         376
Investment securities                                 421        202
Interest-bearing deposits and other                   465        703
Total Interest Income                                 31,623     36,237
                                                                
Interest Expense:                                                
Deposits                                              5,319      7,481
Borrowings                                            2,413      2,893
Total Interest Expense                                7,732      10,374
Net Interest Income                                   23,891     25,863
                                                                
Provision for Losses on Loans                         144        2,279
Net Interest Income After Provision for Loan Losses   23,747     23,584
                                                                
Noninterest Income:                                              
Late charges, rent and other                          1,356      1,103
Loan servicing fees                                   1,133      1,195
Service charges and other fees on deposits            2,041      2,110
Gain on sale of loans                                 2,484      506
Mortgage servicing rights                             (18)       (578)
Gain (loss) on sale of investment, mbs & fixed assets 124        1,282
Income on cash surrender value life insurance         879        880
Total noninterest income                              7,999      6,498
                                                                
Noninterest expense:                                             
Employee compensation and benefits                    12,600     12,337
Occupancy and equipment                               2,964      2,940
FDIC premium and other insurances                     1,816      1,986
Data processing                                       1,147      1,111
Advertising                                           373        363
Franchise taxes                                       765        668
Other operating                                       7,976      9,919
Total noninterest expense                             27,641     29,324
                                                                
Earnings (loss) before provision for income taxes     4,105      758
                                                                
Provision for income taxes                            (58)       544
Reported Net Income                                   4,163      214
                                                                
                                                                
Net Earnings (Loss)                                   4,163      214
                                                                
Earnings (Loss) Per Share:                                       
Basic                                                 $ 0.50      $ 0.03
Diluted                                               $ 0.50      $ 0.03
Earnings Per Share Operations:                                   
Basic                                                 $ 0.50      $ 0.03
Diluted                                               $ 0.50      $ 0.03
                                                                
Basic Weighted Number of Shares Outstanding           8,260,865  7,205,595
Diluted Weighted Number of Shares Outstanding         8,261,396  7,205,595




Camco Financial Corporation
Condensed Consolidated Statements of Operations
Quarterly Information
(In thousands, except for per share data and shares outstanding)
                                                              
                                                              
                  3 Months    3 Months    3 Months    3 Months    3 Months
                  Ended       Ended       Ended       Ended       Ended
                  12/31/12    9/30/12     6/30/12     3/31/12     12/31/11
                  (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
Interest Income:                                               
Loans              7,240      7,522      7,699      8,213      8,501
Mortgage-backed    15         15         17         16         17
securities
Investment         119        116        115        71         50
securities
Interest-bearing   135        112        105        113        101
deposits and other
Total Interest     7,509      7,765      7,936      8,413      8,669
Income
                                                              
Interest Expense:                                              
Deposits           1,128      1,235      1,405      1,551      1,640
Borrowings         577        545        618        673        678
Total Interest     1,705      1,780      2,023       2,224       2,318
Expense
Net Interest       5,804      5,985      5,913       6,189       6,351
Income
                                                              
Provision for      (1,455)    457        137        1,005      (759)
Losses on Loans
Net Interest
Income After       7,259      5,528      5,776       5,184       7,110
Provision for Loan
Losses
                                                              
Noninterest                                                    
Income:
Rent and other     484        321        223        328        202
Loan servicing     284        283        285        281        290
fees
Service charges
and other fees on  528        515        508        490        530
deposits
Gain on sale of    770        633        517        564        377
loans
Mortgage servicing 60         (117)      (63)       102        (365)
rights
Gain (loss) on
sale of            126        --        1          (3)        --
investment, mbs &
fixed assets
Income on CSVL     237        216        208        218        221
(BOLI)
Total noninterest  2,489      1,851      1,679       1,980       1,255
income
                                                              
Noninterest                                                    
expense:
Employee
compensation and   3,208      2,996      3,249      3,147      2,772
benefits
Occupancy and      772        725        756        711        721
equipment
Data processing    326        250        285        286        277
Advertising        77         101        108        87         86
Franchise taxes    182        199        201        183        154
Other operating    2,379      2,677      2,436      2,300      3,491
Total noninterest  6,944      6,948      7,035       6,714       7,501
expense
                                                              
Earnings (loss)
before provision   2,804      431        420         450         864
for income taxes
                                                              
Provision for      20         (53)       (62)       37         2
income taxes
Net Earnings       2,784      484        482         413         862
(loss)
                                                              
Earnings (Loss)                                                
Per Share:
Basic              $ 0.26      $ 0.07      $ 0.06      $ 0.06      $ 0.12
Diluted            $ 0.26      $ 0.07      $ 0.06      $ 0.06      $ 0.12
                                                              
Basic Weighted
Number of Shares   10,806,051 7,467,255  7,468,090  7,220,018  7,205,595
Outstanding
Diluted Weighted
Number of Shares   10,806,269 7,473,123  7,481,854  7,220,130  7,205,595
Outstanding




Camco Financial Corporation
Selected Ratios and Statistics
(In thousands, except for per share data and shares outstanding)
                                                              
                       3 Months      3 Months      12 Months     12 Months
                       Ended         Ended         Ended         Ended
                       12/31/12      12/31/11      12/31/12      12/31/11
                       (Unaudited)   (Unaudited)   (Unaudited)   (Unaudited)
                                                              
Return on average       20.61%        7.67%         8.56%         0.47%
equity
                                                              
Return on average       1.46%         0.45%         0.54%         0.03%
assets
                                                              
Interest rate spread    3.25%         3.59%         3.30%         3.58%
                                                              
Net interest margin     3.36%         3.67%         3.41%         3.66%
                                                              
Yield on earning assets 4.35%         5.01%         4.51%         5.12%
                                                              
Cost of deposits        0.81%         1.16%         0.94%         1.28%
                                                              
Cost of borrowings      3.58%         3.12%         3.37%         3.30%
                                                              
Total cost of interest  1.10%         1.42%         1.21%         1.54%
bearing liabilities
                                                              
Noninterest expense to  3.64%         3.90%         3.59%         3.75%
average assets
                                                              
Efficiency ratio        83.73%        98.62%        86.68%        90.62%
                                                              
Nonperforming assets to 3.95%         4.67%         3.95%         4.67%
total assets
                                                              
Non performing loans to
total net loans         3.42%         3.77%         3.42%         3.77%
including loans held
for sale
                                                              
Allowance for loan
losses to total loans   2.12%         2.20%         2.12%         2.20%
including loans held
for sale
                                                              
Ratios are based upon the mathematical average of the balances at the end of
each month for the quarter and were annualized where appropriate

                                                         
                                                         
                                                         
Camco Financial Corporation                                               
Averages for Quarters Ended                                               
(In thousands, except for per share data and shares outstanding)          
                                                         
                                                                      
                   December 31, 2012       December 31, 2011           
                   Average          Yield/ Average          Yield/
                   Balance  Interest Rate   Balance  Interest Rate
Interest - Earning                                        
Assets:
Loans receivable -  566,769 7,240   5.11%  635,582 8,501   5.35%
net (1)
Securities (2)      81,900  134     0.65%  17,789  67      1.51%
FHLB Stock          9,888   118     4.77%  9,888   99      4.00%
Other interest      32,604  17      0.21%  29,552  2       0.03%
bearing accounts
Total interest      691,161 7,509   4.35%  692,811 8,669   5.01%
earning assets
                                                         
Noninterest-earning 71,508                77,343          
assets
Total Average       762,669               770,154         
Assets
                                                         
                                                         
Interest-Bearing                                          
Liabilities:
Deposits            557,585 1,128   0.81%  565,477 1,640   1.16%
Advances &          64,503  577     3.58%  86,817  678     3.12%
Borrowings
Total
interest-bearing    622,088 1,705   1.10%  652,294 2,318   1.42%
liabilities
                                                         
Noninterest-bearing                                       
sources:
Noninterest-bearing 86,556                72,912          
liabilities
Shareholders'       54,025                44,948          
equity
Total Liabilities
and Shareholders'   762,669               770,154         
Equity
                                                         
Net Interest margin                 3.36%                  3.67%
                                                         
Net Interest Income         5,804   3.25%          6,351   3.59%
& Spread
                                                         
(1)Includes LHFS but does not include ALLL and Non-Accrual Loans          
(2) Includes securities designated as available for sale and held to       
maturity

CONTACT: James E. Huston, CEO
         John E. Kirksey, CFO
         Phone:  740-435-2020

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