Camco Financial Announces First Quarter 2013 Earnings

Camco Financial Announces First Quarter 2013 Earnings

CAMBRIDGE, Ohio, April 29, 2013 (GLOBE NEWSWIRE) -- Camco Financial
Corporation (Nasdaq:CAFI), the bank holding company for Advantage Bank, today
announced financial results for the three months ended March 31, 2013,
reporting net earnings of $499,000 for the first quarter of 2013 compared to
$413,000 for the same period last year. There were 14,392,077 diluted shares
outstanding at March 31, 2013, versus 7,220,130 a year ago, principally due to
successful completion of a $10.0 million rights offering in November 2012.
Diluted earnings per share were $0.03 for the first quarter of 2013 versus
$0.06 the prior year.

James E. Huston, President and CEO, stated, "We are pleased with the 21%
increase in net earnings for the first quarter of 2013 compared to a year
ago.Our results particularly benefited from further improvement in credit
quality, which continued to strengthen key credit measures and enabled us to
record a lower provision for losses on loans for the quarter versus the same
period in 2012." 

Mr. Huston continued, "Specific initiatives are being implemented in this
challenging rate environment to mitigate net interest margin pressures.They
are being pursued through programs to increase core deposits; grow the total
loan portfolio, especially through commercial loans; plus ongoing efforts to
lower our cost of funds.Initial progress is being achieved and we anticipate
these efforts will especially benefit our performance later this year."

Review of Financial Performance

Overview:

The following items summarize key dynamics of the Company during the quarter
ended March 31, 2013:

  *Core deposits (defined as checking, savings and money market deposits)
    increased $25.0 million, or 8% to $331.8 million from the first quarter of
    2012.
  *Net Interest Income declined to $5.4 million from $6.2 million for the
    same period a year ago.This decrease was attributable to a reduction in
    loan balances, especially related to early loan payoffs in late-2012 and
    the anticipated reduction in certificates of deposit in late-2012 coupled
    with lower loan yields for the first quarter of 2013 versus the prior
    year.Growth in core deposits helped to mitigate the impact of the lower
    yield on earning assets.
  *Noninterest income increased 6% to $2.1 million versus the same period a
    year ago primarily due to an increase in gain on sale of residential
    mortgage loans and higher gain on sale of investments.
  *Noninterest expense increased 2% to $6.8 million compared with the first
    quarter of 2012 as a result of higher staffing costs, principally related
    to annual merit increases and growth initiatives, which were partially
    offset by lower professional fees, classified assets expense and costs
    associated with real estate owned.
  *Classified assets (which include substandard, doubtful, loss, and real
    estate owned) were $35.3 million at March 31, 2013, representing a
    decrease of $16.9 million, or 32%, from the same date in 2012.

Net Interest Margin:

Net interest margin was 3.12% for the first quarter of 2013 compared to 3.50%
for the same period last year due to the lower yield on earning assets. We
expect net interest margin to continue to be under pressure in 2013 due to low
interest rates and slow economic growth.The Company continues to seek
favorable risk-adjusted pricing opportunities, further improvement in credit
quality, and other balance sheet changes to maintain net interest margin going
forward.

Net Interest Income:

Net interest income before the provision for loan losses was $5.4 million for
the first quarter of 2013 compared to $6.2 million for the same period a year
ago. The decline was attributable to a reduction in the yield on earning
assets.

The Company's yield on earning assets decreased to 3.96% in the first quarter
of 2013 from 4.76% for the first quarter of 2012.The decrease was due to
lower balances in the total loan portfolio, which resulted from early loan
payoffs in late-2012 as well as lower loan yields attributable to the current
interest rate environment.The planned runoff in certificates of deposit
combined with growth in core deposits contributed to a reduction in the cost
of funds and helped to mitigate the impact of the yield on earning
assets.Cost of funds for the quarter ended March 31, 2013, was 0.95% compared
to 1.36% for the first quarter of 2012.

Provision Expense and Allowance for Loan Losses:

The allowance for loan and lease losses was $11.5 million at March 31, 2013,
compared to $15.0 million on the same date a year ago.This was due to
further improvement in asset quality and therefore the provision for loan
losses was $0.1 million for the first quarter of 2013 compared to $1.0 million
for the same period in 2012. The Company maintains a strong allowance for loan
and lease losses and remains committed to further improvement in asset
quality.

Classified loans (which include substandard, doubtful, and loss) were $27.2
million at March 31, 2013, which was $13.3 million, or 33%, below the same
date in 2012.Non-performing loans were $18.6 million at March 31, 2013, which
was $5.7 million, or 23%, below the March 31, 2012 amount.Non-performing
loans as a percentage of total loans (including loans held for sale) were
3.34% at March 31, 2013, compared to 3.83% on the same date of the prior
year.The allowance for loan and lease losses, expressed as a percentage of
non-performing loans, was 61.8% at March 31, 2013 compared to 61.4% on the
same date last year.

Noninterest Income:

Noninterest income increased to $2.1 million for the first quarter of 2013
from $2.0 million for the first quarter of 2012.This was attributable to an
increase in gain on sale of residential mortgage loans and higher gain on sale
of investments versus the same period last year.

Noninterest Expense:

Noninterest expense was $6.8 million for the first quarter of 2013 compared to
$6.7 million for the same quarter a year ago.The increase was due to higher
staffing costs related to annual merit increases and growth initiatives,
partially offset by lower professional fees, classified assets expense and
real estate owned costs.

Balance Sheet:

Total assets were $763.4 million at March 31, 2013, compared to $786.2 million
on the same date last year.This decrease was principally attributable to
utilization of higher liquid assets from loan pay downs to reduce
single-service certificates of deposit and borrowed funds as we have
restructured our balance sheet to rely less on non-core funding.We also
continue to focus on profitable lending opportunities and investments as a
means of employing our cash efficiently.

Asset Quality:

Loan quality continues to improve resulting in steady progress concerning
classified loans and non-performing loans over the past twelve months.

A summary of certain key factors follows:


(in thousands)                     3/31/2013   12/31/2012   3/31/2012
Classified Loans*                  $27,160     $29,184      $40,444
Non-Performing Loans               $18,647     $19,594      $24,354
Loan Loss Reserve                  $11,532     $12,147      $14,954
Loan Loss Reserve / Total Loans    2.06%       2.12%        2.37%
*Includes substandard, doubtful and loss (including homogeneous loans).

Deposits and Borrowings:

Core deposits (defined as checking, savings, and money market deposits) were
$331.8 million at March 31, 2013, which was $25.0 million, or 8%, higher than
on the same date last year.Total deposits at the end of first quarter of 2013
were $24.1 million, or 4%, below March 31, 2012.The decrease is due to a
planned reduction in certificates of deposit of $49.1 million, or 14%, since
March 31, 2012.The Company is focused on continuing to reduce the level of
non-core deposits, particularly higher single product certificates of deposit
related to rate sensitive shoppers.

FHLB advances and other borrowings were $64.0 million at March 31, 2013, a
decrease of $13.9 million, or 18%, compared to the same date last year.This
planned decrease principally resulted from repayment of FHLB advances
utilizing excess liquidity.

Equity:

Stockholders' equity was $60.7 million at March 31, 2013, compared to $46.1
million at March 31, 2012.Successful completion of the $10 million rights
offering in November 2012, plus higher net earnings during the past twelve
months and proceeds from the exercise of warrants from the rights offering
were key factors contributing to the 32% year-over-year increase.

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 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)
                  3/31/13     12/31/12    9/30/12     6/30/12     3/31/12
Assets                                                         
Cash and Cash      $118,212   $58,379    $26,920    $28,160    $40,431
Equivalents
Investments        39,432     86,201     80,648     75,347     62,834
                                                              
Loans Held for     3,824      6,544      6,341      2,532      5,583
Sale
                                                              
Loans Receivable   555,180    566,722    594,030    613,790    630,124
Allowance for Loan (11,532)    (12,147)    (14,508)    (14,185)    (14,954)
Loss
Loans Receivable,  $543,648   $554,575   $579,522   $599,605   $615,170
Net
                                                              
Other Assets       58,246      58,560      60,811      61,272      62,149
                                                              
Total Assets       $763,362  $764,259  $754,242  $766,916  $786,167
                                                              
Liabilities                                                    
Deposits           $626,741   $627,224   $630,304   $638,516   $650,853
Borrowed Funds     63,981     64,219     64,466     69,200     77,929
Other Liabilities  11,929      13,089      12,050      12,424      11,276
                                                              
Total Liabilities  $702,651   $704,532   $706,820   $720,140   $740,058
                                                              
Stockholders'      60,711      59,727      47,422      46,776      46,109
Equity
                                                              
Total Liabilities
and Stockholders'  $763,362  $764,259  $754,242  $766,916  $786,167
Equity
                                                              
                                                              
Stockholders'
Equity to Total    7.95%       7.82%       6.29%       6.10%       5.87%
Assets
                                                              
Total Shares       13,529,287 13,233,036 7,465,563  7,468,087  7,468,087
Outstanding
                                                              
Book Value Per     $4.49       $4.51       $6.35       $6.26       $6.17
Share
                                                              
                                                              
                                                              
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
                   3/31/13     12/31/12    9/30/12     6/30/12     3/31/12
                  (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
Interest Income:                                               
Loans              $6,590     $7,240     $7,522     $7,699     $8,213
Mortgage-backed    13         15         15         17         16
securities
Investment         106        119        116        115        71
securities
Interest-bearing   149        135        112        105        113
deposits and other
Total Interest     $6,858     $7,509     $7,765     $7,936     $8,413
Income
                                                              
Interest Expense:                                              
Deposits           $1,033     $1,128     $1,235     $1,405     $1,551
Borrowings         426        577        545        618        673
Total Interest     $1,459     $1,705     $1,780     $ 2,023     $ 2,224
Expense
Net Interest       $5,399     $5,804     $5,985     $ 5,913    $ 6,189
Income
                                                              
Provision for      100        (1,455)    457        137        1,005
Losses on Loans
Net Interest
Income After       $5,299     $7,259     $5,528     $ 5,776     $ 5,184
Provision for Loan
Losses
                                                              
Noninterest                                                    
Income:
Rent and other     $301       $484       $321       $223       $328
Loan servicing     276        284        283        285        281
fees
Service charges
and other fees on  462        528        515        508        490
deposits
Gain on sale of    689        770        633        517        564
loans
Mortgage servicing 105        60         (117)      (63)       102
rights
Gain (loss) on
sale of            61         126        --        1          (3)
investment, mbs &
fixed assets
Income on CSVL     208        237        216        208        218
(BOLI)
Total noninterest  $2,102     $2,489     $1,851     $ 1,679     $ 1,980
income
                                                              
Noninterest                                                    
expense:
Employee
compensation and   $3,509     $3,208     $2,996     $3,249     $3,147
benefits
Occupancy and      745        772        725        756        711
equipment
Data processing    283        326        250        285        286
Advertising        144        77         101        108        87
Franchise taxes    230        182        199        201        183
Other operating    1,936      2,379      2,677      2,436      2,300
Total noninterest  $6,847     $6,944     $6,948     $ 7,035     $ 6,714
expense
                                                              
Earnings (loss)
before provision   $554       $2,804     $431       $ 420       $ 450
for income taxes
                                                              
Provision for      55         20         (53)       (62)       37
income taxes
Net Earnings       $499       $2,784     $484       $ 482       $ 413
(loss)
                                                              
Earnings (Loss)                                                
Per Share:
Basic              $0.04       $0.26       $0.07       $0.06       $0.06
Diluted            $0.03       $0.26       $0.07       $0.06       $0.06
                                                              
Basic Weighted
Number of Shares   13,386,828 10,806,051 7,467,255  7,468,090  7,220,018
Outstanding
Diluted Weighted
Number of Shares   14,392,077 10,806,269 7,473,123  7,481,854  7,220,130
Outstanding



Camco Financial Corporation
Selected Ratios and Statistics
(In thousands, except for per share data and shares outstanding)
                                                           
                                           3 Months          3 Months
                                          Ended             Ended
                                           3/31/13           3/31/12
                                          (Unaudited)       (Unaudited)
                                                           
Return on average equity                   3.32%             3.61%
                                                           
Return on average assets                   0.26%             0.21%
                                                           
Interest rate spread                       3.01%             3.40%
                                                           
Net interest margin                        3.12%             3.50%
                                                           
Yield on earning assets                    3.96%             4.76%
                                                           
Cost of deposits                           0.75%             1.08%
                                                           
Cost of borrowings                         2.67%             3.42%
                                                           
Total cost of interest bearing liabilities 0.95%             1.36%
                                                           
Noninterest expense to average assets      3.59%             3.47%
                                                           
Efficiency ratio                           91.28%            82.19%
                                                           
Nonperforming assets to total assets       3.64%             4.70%
                                                           
Non performing loans to total net loans    3.34%             3.83%
including loans held for sale
                                                           
Allowance for loan losses to total loans   2.06%             2.37%
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)
                                                                  
                          
                          March 31, 2013            March 31, 2012
                          Average   Interest Yield/ Average   Interest Yield/
                           Balance            Rate   Balance            Rate
Interest - Earning Assets:                                         
Loans receivable - net (1) $543,218 $6,590  4.85%  $622,459 $8,213  5.28%
Securities (2)             68,341   119     0.70%  41,303   87      0.84%
FHLB Stock                 9,888    106     4.29%  9,888    112     4.53%
Other interest bearing     70,539   43      0.24%  32,969   1       0.01%
accounts
Total interest earning     $691,986 $6,858  3.96%  $706,619 $8,413  4.76%
assets
                                                                  
Noninterest-earning assets $70,853                $68,022          
Total Average Assets       $762,839               $774,641         
                                                                  
                                                                  
Interest-Bearing                                                   
Liabilities:
Deposits                   $552,626 $1,033  0.75%  $573,826 $1,551  1.08%
Advances & Borrowings      63,759   426     2.67%  78,691   673     3.42%
Total interest-bearing     $616,385 $1,459  0.95%  $652,517 $2,224  1.36%
liabilities
                                                                  
Noninterest-bearing                                                
sources:
Noninterest-bearing        $86,287                $76,351          
liabilities
Shareholders' equity       60,167                 45,773           
Total Liabilities and      $762,839               $774,641         
Shareholders' Equity
                                                                  
Net Interest margin                         3.12%                   3.50%
                                                                  
Net Interest Income &               $5,399  3.01%           $6,189  3.40%
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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