Breaking

Tweet TWEET

Cascade Bancorp Reports First Quarter 2014 Financial Results

         Cascade Bancorp Reports First Quarter 2014 Financial Results

PR Newswire

BEND, Ore., May 8, 2014

BEND, Ore., May 8, 2014 /PRNewswire/ -- Cascade Bancorp, (NASDAQ: CACB)
("Company" or "Cascade") the holding company for Bank of the Cascades
("Bank"), today announced its financial results for the three months ended
March 31, 2014. The full details of the Company's first quarter 2014 results
were filed with the Securities and Exchange Commission ("SEC") in the
Company's quarterly report on Form 10-Q on May 8, 2014.

First Quarter 2014 Financial Highlights

  oNet income for the first quarter of 2014 was $0.9 million or $0.02 per
    diluted share compared to $1.7 million or $0.04 per diluted share for the
    first quarter of 2013.
  oStockholders' equity increased to $190.3 million or $4.00 per share at
    March 31, 2014 as compared to $188.7 million or $3.97 per share at
    December 31, 2013.
  oGross loans at March 31, 2014 totaled $1.0 billion, an increase of 14.9%
    and 1.1% compared to March 31, 2013 and December 31, 2013, respectively.
  oAs of March 31, 2014, substandard loans were reduced by 4.9% to $39.2
    million compared to December 31, 2013.
  oNon-performing assets improved to 0.65% of total assets at March 31, 2014
    compared to 0.81% at December 31, 2013 and net recoveries for the first
    quarter of 2014 were $0.9 million, as compared to net charge-offs of $2.7
    million in the first quarter of 2013.
  oTotal deposits as of March 31, 2014 decreased $4.7 million or 0.40%
    compared to December 31, 2013.
  oNet Interest Margin ("NIM") was 3.83% as of March 31, 2014 compared to
    4.11% for the quarter ended December 31, 2013.

Terry Zink, President and Chief Executive Officer of Cascade Bancorp,
commented, "The first quarter marked a critical inflection point in Cascades'
recent history as we focus our strategy toward becoming a leading Pacific
Northwest community bank with strong return metrics."He continued by saying,
"Assuming we receive the requisite shareholder approvals, we expect to close
our proposed merger with Home Federal Bancorp ("Home Federal") in mid-May."

Mr. Zink went on to say, "Upon the anticipated closing of the merger, we look
forward to welcoming Home Federal Bank customers to Bank of the Cascades and
realizing the opportunities to enhance efficiencies while delivering expanded
services and conveniences."

Greg Newton, Chief Financial Officer, added, "Much of our focus during this
quarter was preparation for the merger with Home Federal. We are pleased that
our credit quality metrics continued to improve during the quarter with
reductions in both substandard loans and non-performing assets, while loans
and deposits were stable during our seasonally slower winter quarter."He
added, "Also, during this quarter we continued to re-balance the loan
portfolioin favor of commercial and industrial loans.This loan type was up
$19.3 million or 7.6% from the prior quarter while commercial real estate
loans declined $8.3 million or 1.5% during the quarter.This resulted in
modest overall loan growth in our seasonally weakest period."

Financial Review

Total assets were $1.4 billion at March 31, 2014, down $32.2 million from
December 31, 2013. The decrease in total assets during the period ended March
31, 2014 primarily resulted from decreases in cash and cash equivalents of
$31.8 million, investments of $4.7 million and loans held for sale of $6.0
million. These decreases were partially offset by a $10.3 million increase in
net loans.

The decline in cash and cash equivalents resulted primarily from the payoff of
$27.0 million short-term FHLB advances outstanding at year end. The decline in
investment securities available-for-sale during the three months ended March
31, 2014 was primarily the result of the principal pay downs of our
mortgage-backed securities.

Total loans and loans held-for-sale outstanding increased $5.2 million to $1.0
billion at March 31, 2014 compared to December 31, 2013, primarily
attributable to increased balances in the commercial and industrial portfolio.

Loan quality continued to improve with remediation of special mention and
substandard loans. Loans categorized as such totaled $67.3 million at March
31, 2014 as compared to $85.1 million at December 31, 2013. Remediation was
accomplished through credit upgrades owing to improved obligor cash flows as
well as payoffs/paydowns, note sales and/or charge offs related to the
restructure of adversely risk rated loans. Non-performing assets as of March
31, 2014 improved to 0.65% of total assets as compared to 0.81% at December
31, 2013. Net recoveries during the first quarter of 2014 were $0.9 million;
the Company made no provision for loan losses as management believes the
reserve for loan losses of $21.7 million at March 31, 2014 is adequate.

Total liabilities were $1.2 billion at March 31, 2014, a $33.8 million
decrease from December 31, 2013. This was primarily the result of $27.0
million in reduced FHLB borrowings and a $4.7 million decrease in total
deposits.

Net income for the quarter ended March 31, 2014 was $0.02 per share, or $0.9
million, compared to $0.04 per share, or $1.7 million, for the first quarter
of 2013 and $0.03 per share, or $1.2 million, in the fourth quarter of 2013
("linked quarter"). The decrease in net income in the first quarter of 2014
compared to the same period in 2013 was primarily the result of $0.8 million
in transaction related expenses related to our proposed merger with Home
Federal. The decrease in net income in the first quarter of 2014 compared to
the fourth quarter of 2013 was primarily a result of a recovery of $1.0
million in interest from the payoff of a non-accrual loan in the fourth
quarter of 2013.

Net interest income was $11.7 million for the first quarter of 2014,
comparable to $11.6 million in the first quarter of 2013 and down from $13.1
million in the fourth quarter of 2013. The $1.3 million decline from the
linked quarter to the current quarter was related to the inclusion of the $1.0
million recovery discussed above.

Total interest income decreased $0.5 million from $12.6 million in the first
quarter of 2013 to $12.1 million in the first quarter of 2014. The decrease
was due primarily to lower interest rates in the first quarter of 2014
compared to the same period in 2013.

Total interest expense for the first quarter of 2014 decreased $0.6 million
compared to the first quarter of 2013. This improvement was primarily due to
lower rates on deposits and reduced borrowing expenses.

Total non-interest income remained relatively consistent in the first quarter
of 2014 compared to the same period in 2013 mainly as a result of increases in
card issuer and merchant services fees of $0.3 million, customer swap fee
income of $0.3 million in connection with the Company's newly initiated
interest rate swap products, as well as increased Small Business
Administration fees. These increases were offset by reduced mortgage banking
income of $0.7 million in the first quarter of 2014 compared to the first
quarter of 2013.

Total non-interest expense for the three months ended March31, 2014 increased
over the three months ended March31, 2013 due primarily to merger related
expenses of $0.8 million in the first quarter of 2014. Total non-interest
expense decreased $0.9 million in the first quarter of 2014 compared to the
linked quarter. The decrease was primarily related to $0.7 million of accrued
bonuses in the fourth quarter of 2013 issued in connection with the Company's
annual incentive plan.

Conference Call Information

Cascade announced on April 30, 2014 in a Form 8-K filed with the SEC that they
will conduct a quarterly earnings conference call Thursday, May 8, 2014, at
2:00 p.m. PDT (5:00 p.m. EDT). Terry E. Zink, President and CEO, and Gregory
Newton, Executive Vice President and CFO, will discuss first quarter 2014
results and provide an update on recent activities. There will be a
question-and-answer session following the presentation. Shareholders, analysts
and other interested parties are invited to join the call by dialing (888)
567-1602 a few minutes before 2:00 p.m. Information to be discussed in the
teleconference will be available on the Company's website www.botc.com under
the "Investor Information" tab, shortly after the call.

About Cascade Bancorp and Bank of the Cascades

Cascade Bancorp (NASDAQ: CACB), headquartered in Bend, Oregon, and its wholly
owned subsidiary, Bank of the Cascades, operate in Oregon and Idaho markets.
Founded in 1977, Bank of the Cascades offers full-service community banking
through 28 branches in Central, Southern and Northwest Oregon, as well as in
the greater Boise/Treasure Valley, Idaho area. The Bank has a business
strategy that focuses on delivering the best in community banking for the
financial well-being of customers and shareholders. It executes its strategy
through the consistent delivery of full relationship banking focused on
attracting and retaining value-driven customers. For further information,
please visit our website at www.botc.com.

FORWARD LOOKING STATEMENTS

This release contains forward-looking statements about Cascade Bancorp's plans
and anticipated results of operations and financial condition. These
statements include, but are not limited to, our plans, objectives,
expectations, and intentions and are not statements of historical fact. When
used in this report, the word "expects," "believes," "anticipates," "could,"
"may," "will," "should," "plan," "predicts," "projections," "continue" and
other similar expressions constitute forward-looking statements, as do any
other statements that expressly or implicitly predict future events, results
or performance, and such statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. Certain
risks and uncertainties and Cascade Bancorp's success in managing such risks
and uncertainties could cause actual results to differ materially from those
projected, including among others, the following factors: local and national
economic conditions could be less favorable than expected or could have a more
direct and pronounced effect on us than expected and adversely affect our
results of operations and financial condition; the local housing/real estate
market could continue to decline for a longer period than we anticipate; the
risks presented by a continued economic recession, which could continue to
adversely affect credit quality, collateral values, including real estate
collateral and OREO properties, investment values, liquidity and loan
originations, reserves for loan losses and charge offs of loans and loan
portfolio delinquency rates and may be exacerbated by our concentration of
operations in the States of Oregon and Idaho generally, and Central, Southern
and Northwest Oregon, as well as the greater Boise/Treasure Valley, Idaho
area, specifically; interest rate changes could significantly reduce net
interest income and negatively affect funding sources; competition among
financial institutions could increase significantly; competition or changes in
interest rates could negatively affect net interest margin, as could other
factors listed from time to time in Cascade Bancorp's SEC reports; the
reputation of the financial services industry could further deteriorate, which
could adversely affect our ability to access markets for funding and to
acquire and retain customers; and existing regulatory requirements, changes in
regulatory requirements and legislation (including without limitation, the
Dodd-Frank Wall Street Reform and Consumer Protection Act) and our inability
to meet those requirements, including capital requirements and increases in
our deposit insurance premium, could adversely affect the businesses in which
we are engaged, our results of operations and financial condition. Such
forward-looking statements also include, but are not limited to, statements
about the benefits of the proposed merger involving Cascade and Home Federal,
including future financial and operating results, Cascade's or Home Federal's
plans, objectives, expectations and intentions, the expected timing of
completion of the merger and other statements that are not historical facts.
Important factors that could cause actual results to differ materially from
those indicated by such forward-looking statements include risks and
uncertainties relating to: (i) the ability to obtain the requisite Cascade and
Home Federal shareholder approvals; (ii) the risk that a condition to the
closing of the merger may not be satisfied; (iii) the timing to consummate the
proposed merger; (iv) the risk that the businesses will not be integrated
successfully; (v) the risk that the cost savings and any other synergies from
the transaction may not be fully realized or may take longer to realize than
expected; (vi) disruption from the transaction making it more difficult to
maintain relationships with customers, employees or vendors; (vii) the
diversion of management time on merger-related issues; (viii) general
worldwide economic conditions and related uncertainties; (ix) liquidity risk
affecting Cascade's ability to meet its obligations when they come due; (x)
excessive loan losses; (xi) the effect of changes in governmental regulations;
and (xii) other factors we discuss or refer to in the "Risk Factors" section
of Cascade's most recent Annual Report on Form 10-K filed with Securities and
Exchange Commission (the "SEC") on March 31, 2014. These risks, as well as
other risks associated with the merger, are more fully discussed in the joint
proxy statement/prospectus mailed to stockholders of Cascade and Home Federal
on or about April 16, 2014, and included in the Registration Statement on Form
S-4 (registration statement number 333-192865), as amended, that was filed
with the SEC in connection with the merger. Additional risks and uncertainties
are identified and discussed in Cascade's reports filed with the SEC and
available at the SEC's website at www.sec.gov. These forward-looking
statements speak only as of the date of this release. Cascade Bancorp
undertakes no obligation to publish revised forward-looking statements to
reflect the occurrence of unanticipated events or circumstances after the date
hereof. Readers should carefully review all disclosures filed by Cascade
Bancorp from time to time with the SEC.

Participants in the Solicitation
Cascade, Home Federal and their respective directors and executive officers
may be soliciting proxies from Cascade and Home Federal shareholders in favor
of the proposed merger and related matters. Information regarding the persons
who may, under the rules of the SEC, be deemed participants in the
solicitation of Cascade and Home Federal shareholders in connection with the
proposed merger and a description of their direct and indirect interests, by
security holdings or otherwise is set forth in the joint proxy
statement/prospectus filed with the SEC on April 11, 2014. You can find
information about Cascade's directors and executive officers in Cascade's
definitive proxy statement filed with the SEC on April 28, 2014 for its 2014
Annual Meeting of Shareholders. You can find information about Home Federal's
directors and executive officers in Home Federal's Form 10-K/A filed with the
SEC on April 29, 2014. Additional information about Cascade's directors and
executive officers and Home Federal's directors and executive officers can
also be found in the above-referenced joint proxy statement/prospectus and
other relevant materials filed with the SEC. Investors should read the joint
proxy statement/prospectus carefully when it becomes available before making
any voting or investment decisions. You can obtain free copies of these
documents from Cascade and Home Federal using the contact information above.

Additional Information about the Proposed Merger and Where to Find It
This document does not constitute an offer to sell or the solicitation of an
offer to buy any securities, or a solicitation of any vote or approval, nor
shall there be any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of any such jurisdiction. In connection with the
proposed merger between Cascade and Home Federal, Cascade has filed with the
SEC a Registration Statement on Form S-4 (registration statement number
333-192865), which includes a joint proxy statement of Cascade and Home
Federal that also constitutes a prospectus. The joint proxy
statement/prospectus was mailed to shareholders of Cascade and Home Federal on
or about April 16, 2014. Each of Cascade and Home Federal may file other
relevant documents concerning the proposed transaction. Cascade and Home
Federal urge investors and security holders to read the definitive joint proxy
statement/prospectus regarding the proposed merger, as well as other documents
filed with the SEC because they will contain important information about the
proposed merger. You may obtain copies of all documents filed with the SEC
regarding this transaction, free of charge, at the SEC's website
(www.sec.gov). You may also obtain these documents, free of charge, from: (i)
Cascade's website (www.botc.com) under the heading "About Us" and then under
the heading "Investor Relations" and then under the heading "Investor
Information" and then under the tab "SEC Filings;" (ii) Cascade upon written
request to Cascade Bancorp, Attn: Investor Relations, 1100 North West Wall
Street, P.O. Box 369, Bend, Oregon 97701; (iii) Home Federal's website
(www.myhomefed.com/ir) under the heading "Investor Relations" and then under
the heading "SEC Filings;" or (iv) Home Federal upon written request to Home
Federal Bancorp, Inc., Attn: Eric Nadeau, 500 12th Avenue South, Nampa, Idaho
83651.

Information contained herein, other than information at December 31, 2013, and
for the twelve months then ended, is unaudited. All financial data should be
read in conjunction with the notes to the consolidated financial statements of
Cascade Bancorp and subsidiary as of and for the fiscal year ended December
31, 2013, as contained in the Company's Annual Report on Form 10-K for such
fiscal year.

CASCADE BANCORP
CONSOLIDATED BALANCE SHEETS
(In thousands) (Unaudited)
                             March 31, 2014  December 31, 2013  March 31, 2013
ASSETS
Cash and cash equivalents:
Cash and due from banks      $  30,776       $   33,300         $  31,430
Interest bearing deposits    19,239          48,527             113,243
Federal funds sold           22              22                 22
Total cash and cash          50,037          81,849             144,695
equivalents
Investment securities        189,752         194,481            232,672
available-for-sale
Investment securities        1,320           1,320              1,806
held-to-maturity
Federal Home Loan Bank       9,820           9,913              10,192
(FHLB) stock
Loans held for sale          4,398           10,359             1,444
Loans, net                   983,925         973,618            850,765
Premises and equipment, net  32,376          32,953             34,166
Bank-owned life insurance    36,750          36,567             35,916
(BOLI)
Other real estate owned      2,995           3,144              5,684
(OREO), net
Deferred tax asset (DTA),    49,477          50,068             —
net
Other assets                 13,163          11,947             11,165
Total assets                 $  1,374,013    $   1,406,219      $  1,328,505
LIABILITIES & STOCKHOLDERS'
EQUITY
Liabilities:
Deposits:
Demand                       $  450,648      $   431,079        $  387,451
Interest bearing demand      534,723         544,668            541,343
Savings                      53,443          50,258             43,419
Time                         123,779         141,315            131,974
Total deposits               1,162,593       1,167,320          1,104,187
FHLB borrowings              —               27,000             60,000
Other liabilities            21,157          23,184             22,269
Total liabilities            1,183,750       1,217,504          1,186,456
Stockholders' equity:
Preferred stock, no par
value; 5,000,000 shares      —               —                  —
authorized; none issued or
outstanding
 Common stock, no par
value; 100,000,000 shares    330,988         330,839            330,150
authorized
Accumulated deficit          (141,145)       (142,088)          (191,236)
Accumulated other            420             (36)               3,135
comprehensive income
Total stockholders' equity   190,263         188,715            142,049
Total liabilities and        $  1,374,013    $   1,406,219      $  1,328,505
stockholders' equity





CASCADE BANCORP
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands) (Unaudited)
                                      Three Months Ended    Three Months Ended
                                      March 31,             December 31,
                                      2014       2013       2013      2012
Interest income:
 Interest and fees on loans         $ 10,749   $ 11,238   12,053    11,601
 Interest on investments            1,328      1,322      1,377     1,377
 Other investment income            27         37         72        45
Total interest income                 12,104     12,597     13,502    13,023
Interest expense:
Deposits:
 Interest bearing demand            175        166        191       179
 Savings                            4          5          5         5
 Time                               183        333        216       405
 Other borrowings                   5          474        21        479
Total interest expense                367        978        433       1,068
Net interest income                   11,737     11,619     13,069    11,955
 Loan loss provision                —          —
Net interest income after loan loss   11,737     11,619     13,069    11,955
provision
Non-interest income:
 Service charges on deposit         753        735        786       773
accounts
 Card issuer and merchant services  1,001      751        837       662
fees, net
 Earnings on bank owned life        183        211        203       271
insurance 
 Mortgage banking income, net       434        1,160      757       1,371
 Swap fee income                    326        —          430       —
 Other income                       655        499        931       374
Total non-interest income             3,352      3,356      3,944     3,451
Non-interest expense:
 Salaries and employee benefits     7,643      7,647      8,412     7,839
 Occupancy                          1,140      1,155      1,101     1,154
 Information Technology             787        577        563       543
 Equipment                          337        368        392       404
 Communications                     383        366        388       392
 FDIC insurance                     232        445        237       471
 OREO                               (8)        277        207       891
 Professional services              1,332      681        1,714     1,369
 Decrease in reserve for unfunded   —          —          —         (1,110)
loan commitments 
 Other expenses                     2,004      1,795      1,752     2,116
Total non-interest expense            13,850     13,311     14,766    14,069
Income before income taxes            1,239      1,664      2,247     1,337
 Income tax benefit (provision)     (296)      32         (1,013)   (29)
Net income                            $ 943      $ 1,696    $ 1,234   $ 1,308





CASCADE BANCORP
ADDITIONAL FINANCIAL INFORMATION
(In thousands, except per share data) (Unaudited)
                            LINKED QUARTER               YEAR OVER YEAR
                            March 31, 2014 December 31,  March 31,  March 31,
                                           2013          2014       2013
Share Data
Basic net income per common $   0.02       $  0.03       $ 0.02     $ 0.04
share
Diluted net income per      $   0.02       $  0.03       $ 0.02     $ 0.04
common share
Book value per basic common $   4.00       $  3.97       $ 4.00     $ 2.99
share
Basic average shares        47,233         47,588        47,233     47,141
outstanding
Fully diluted average       47,296         47,576        47,296     47,254
shares outstanding
Key Ratios
Return on average total     2.02        %  2.59       %  2.02     % 4.84     %
shareholders' equity
Return on average total     0.28        %  0.35       %  0.28     % 0.53     %
assets
Net interest spread         3.75        %  4.02       %  3.75     % 3.71     %
Net interest margin         3.83        %  4.11       %  3.83     % 3.92     %
Total revenue               $   15,089     $  17,013     $ 15,089   $ 14,975
Efficiency ratio^1          91.79       %  86.79      %  91.79    % 88.89    %
Credit Quality Ratios
Reserve for credit losses   $   22,162     $  21,297     $ 22,162   $ 24,988
Reserve for credit losses   2.20        %  2.14       %  2.20     % 2.85     %
to ending gross loans
Non-performing assets       $   8,906      $  11,453     $ 8,906    $ 21,902
("NPAs")
Non-performing assets to    0.65        %  0.81       %  0.65     % 1.65     %
total assets
Delinquent >30 days to      0.33        %  0.29       %  0.33     % 0.61     %
total loans (excl. NPAs)
Net Charge off's            $   (865)      $  796        $ (865)    $ 2,713
Net loan charge-offs to     (0.09)      %  0.08       %  (0.09)   % 0.31     %
average total loans
Bank Capital Ratios
Tier 1 capital leverage     10.89       %  10.49      %  10.89    % 10.69    %
ratio
Tier 1 risk-based capital   13.21       %  13.01      %  13.21    % 14.27    %
ratio
Total risk-based capital    14.47       %  14.27      %  14.47    % 15.54    %
ratio
Bancorp Capital Ratios
Tier 1 capital leverage     10.89       %  10.49      %  10.89    % 10.72    %
ratio
Tier 1 risk-based capital   13.19       %  12.99      %  13.19    % 14.31    %
ratio
Total risk-based capital    14.45       %  14.25      %  14.45    % 15.58    %
ratio

^1 The efficiency ratio is a non-GAAP ratio that is calculated by dividing
non-interest expense by the sum of net interest income and non-interest
income. Other companies may define and calculate this data differently.







SOURCE Cascade Bancorp

Website: http://www.botc.com
Contact: Terry E. Zink, President and Chief Executive Officer, Cascade Bancorp
(541) 617-3527, Gregory D. Newton, EVP and Chief Financial Officer, Cascade
Bancorp (541) 617-3526
 
Press spacebar to pause and continue. Press esc to stop.