CSB Bancorp (CSBB) 8-K CSB Bancorp, Inc. Reports Third Quarter Earnings

Exhibit 99.1

CSB BANCORP, INC. REPORTS THIRD QUARTER EARNINGS

Third Quarter Highlights

	Quarter Ended September 30, 2011			Quarter Ended September 30, 2010
Diluted earnings per share	$	.37		$	.32
Net Income	$	999,000		$	882,000
Return on average common equity		8.04	%		7.41	%
Return on average assets		0.87	%		0.78	%

Millersburg, Ohio – October 26, 2011 – CSB Bancorp, Inc. (OTCBB: CSBB.ob) today announced third quarter 2011 net income of $999 thousand or $.37 per basic and diluted share, as compared to $882 thousand or $.32 per basic and diluted share for the same period in 2010.

Annualized returns on average common equity (“ROE”) and average assets (“ROA”) for the quarter were 8.04% and 0.87%, respectively, compared with 7.41% and 0.78% for the third quarter of 2010.

Eddie Steiner, President and CEO commented, “Total revenue continues to improve and provision expenses for loan losses are tracking below prior year levels. However, loan demand remains relatively soft, and we expect low interest rates to continue to exert pressure on net interest margin for the foreseeable future.”

Revenue totaled $5.3 million for the third quarter of 2011, an increase of 9.6% from third quarter of the prior year. The increase in revenue was primarily attributable to lower interest expense, resulting in a 4% increase in net interest income to $4.2 million for the quarter. Noninterest income totaled $1.1 million, a 40% increase from third quarter 2010. Current year third quarter noninterest income includes a gain of $237 thousand from the sale of investment securities. Excluding the current year sales gain, current period noninterest income reflected an increase of $77 thousand or 9.9% over the same period of the prior year.

Non-interest expense amounted to $3.5 million during the quarter, an increase of $294 thousand or 9.1% from third quarter 2010. The largest portion of the increase was attributable

to conversion expenses incurred to acquire two banking offices in Wooster, Ohio. The Company’s third quarter efficiency ratio was 69.6% as compared to 66.7% for the same quarter in the prior year.

Federal income tax provision totaled $444 thousand for third quarter 2011, compared to $402 thousand for the same quarter in 2010. The quarterly provisions reflect effective tax rates of 30.8% in 2011 as compared to 31.3% for the third quarter 2010.

Total assets amounted to $458 million on September 30, 2011, up $1 million or 0.2% from December 31, 2010. Total loan balances of $314 million, were 0.5% below the prior year-end, while securities balances of $91 million were up $10 million or 12.5% from the prior year-end.

Average total assets during the quarter amounted to $455 million, an increase of $6.5 million or 1.4% during the quarter. Average loan balances of $316 million declined $4 million during the quarter and average securities balances increased $1 million to $87 million from the immediately preceding quarter.

Average commercial loan balances, including commercial real estate, decreased $1.5 million or 0.7% during the quarter, while average residential mortgage balances declined $4 million or 5.4%. The decline of in-house mortgage balances reflects a continuation of slow housing activity and customers selecting secondary market mortgage loans because of low prevailing long-term interest rates in those products. Average home equity balances increased $1.5 million or 4.1% during third quarter, while average consumer credit balances decreased $0.3 million or 3.7%.

Net charge-offs for the quarter totaled $178 thousand as compared to net charge-offs of $440 thousand during third quarter 2010. Net charge-offs for the first nine months of the year equated to 0.26% of average loans as compared to 0.28% during the same period of the prior year.

Nonperforming assets totaled $4.0 million or 1.3% of total loans plus other real estate at September 30, 2011, compared to $5.4 million or 1.7% at September 30, 2010. Delinquent loan balances as of September 30, 2011 amounted to 1.7% of total loans as compared to 2.5% at September 30, 2010.

The Company funded $240 thousand in loan loss provision during the third quarter and the allowance for loan losses amounted to 1.31% of total loans on September 30, 2011. The ratio of the allowance for loan losses to nonperforming loans stood at 118% on September 30, 2011 as compared to 115% at the end of the prior quarter and 84% as of September 30, 2010.

Average deposit balances increased by $2.0 million during the third quarter, or 0.5%. Total average deposits of $351 million for the quarter were 4.3% above the prior year’s third quarter average.

Within the deposit category, average non-interest-bearing balances increased $3.4 million or 5.3% from the immediate prior quarter. Average interest-bearing checking, money market and

traditional savings balances increased $81 thousand or 0.1% during the quarter, while average time deposit balances decreased $1.5 million or 1.1%.

The average balance of securities sold under repurchase agreement increased by $3.4 million or 11.2% during the quarter. These repurchase agreements, while considered short-term borrowings, are primarily tied to overnight customer sweep accounts. Average borrowings from the Federal Home Loan Bank (“FHLB”) decreased $0.2 million or 1.0% during the quarter as maturing advances were paid down.

Shareholders’ equity totaled $49.2 million on September 30, 2011 with 2.7 million common shares outstanding at quarter-end. Tangible equity to assets approximated 10.3% on September 30, 2011 as compared to 9.9% at December 31, 2010. The Company declared a common dividend of $.18 per share during the quarter. Based on the September 30, 2011 closing stock price of $15.00 per share, the Company’s annual dividend yield approximates 4.8%.

On October 14, 2011, CSB acquired two branch offices in Wooster, Ohio, including $74 million in deposit balances, $10 million in loans, and certain other assets and obligations related to the two offices.

About CSB Bancorp, Inc.

CSB is a financial holding company headquartered in Millersburg, Ohio, with approximate assets of $458 million as of September 30, 2011. CSB provides a complete range of banking and other financial services to consumers and businesses through its wholly owned subsidiary, The Commercial and Savings Bank, with fourteen banking centers in Holmes, Tuscarawas, Wayne and Stark counties and Trust offices located in Millersburg and Wooster, Ohio.

Forward-Looking Statement

This release contains forward-looking statements relating to present or future trends or factors affecting the banking industry, and specifically the financial condition and results of operations, including without limitation, statements relating to the earnings outlook of the Company, as well as its operations, markets and products. Actual results could differ materially from those indicated. Among the important factors that could cause results to differ materially are interest rate changes, softening in the economy, which could materially impact credit quality trends and the ability to generate loans, changes in the mix of the Company’s business, competitive pressures, changes in accounting, tax or regulatory practices or requirements and those risk factors detailed in the Company’s periodic reports and registration statements filed with the Securities and Exchange Commission. The Company undertakes no obligation to release revisions to these forward-looking statements or reflect events or circumstances after the date of this release.

Contact Information:

Paula J. Meiler, SVP & CFO

330-763-2873

paula.meiler@csb1.com

CSB BANCORP, INC.

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)

(Dollars in thousands except per share data)

	Quarters
	2011			2011			2011			2010			2010			2011			2010
EARNINGS	3rd Qtr			2nd Qtr			1st Qtr			4th Qtr			3rd Qtr			9 months			9 months
Net interest income FTE (a)	$	4,163		$	4,158		$	3,995		$	3,959		$	4,016		$	12,316		$	11,837
Provision for loan losses		240			190			280			239			238			710			996
Other income		1,095			784			761			904			780			2,640			2,400
Other expenses		3,509			3,283			3,120			3,169			3,215			9,912			9,406
FTE adjustment (a)		66			62			61			60			59			189			166
Net income		999			972			896			956			882			2,867			2,540
Diluted earnings per share		0.37			0.35			0.33			0.35			0.32			1.05			0.93
PERFORMANCE RATIOS
Return on average assets (ROA)		0.87	%		0.87	%		0.80	%		0.83	%		0.78	%		0.85	%		0.77	%
Return on average common equity (ROE)		8.04	%		8.06	%		7.67	%		7.95	%		7.41	%		7.92	%		7.25	%
Net interest margin FTE (a)		3.83	%		3.93	%		3.78	%		3.64	%		3.76	%		3.85	%		3.77	%
Efficiency ratio		69.60	%		66.13	%		65.29	%		64.84	%		66.72	%		67.03	%		66.43	%
Number of full-time equivalent employees		144			143			142			140			144
MARKET DATA
Book value/common share	$	17.99		$	17.75		$	17.35		$	17.24		$	17.26
Period-end common share mkt value		15.00			15.50			15.20			15.57			15.95
Market as a % of book		83.38	%		87.32	%		87.61	%		90.31	%		92.41	%
Price-to-earnings ratio		10.71			11.48			11.34			12.16			12.56
Cash dividends/common share	$	0.18		$	0.18		$	0.18		$	0.18		$	0.18			0.54			0.54
Common stock dividend payout ratio		48.65	%		51.43	%		54.55	%		51.43	%		56.25	%
Average basic common shares		2,734,799			2,734,799			2,734,799			2,734,799			2,734,799			2,734,799			2,734,799
Average diluted common shares		2,734,799			2,734,831			2,734,812			2,734,836			2,734,799			2,734,799			2,734,799
Period end common shares outstanding		2,734,799			2,734,799			2,734,799			2,734,799			2,734,799
Common shares repurchased		0			0			0			0			0			0			0
Common stock market capitalization	$	41,022		$	42,389		$	41,569		$	42,581		$	43,620
ASSET QUALITY
Gross charge-offs	$	192		$	178		$	316		$	621		$	459			686			768
Net charge-offs (recoveries)		178			164			283			615			440			625			649
Allowance for loan losses		4,116			4,054			4,028			4,031			4,407
Nonperforming assets (NPAs)		4,000			3,974			3,943			4,626			5,410
Net charge-off/average loans ratio		0.22	%		0.21	%		0.36	%		0.77	%		0.55	%		0.26	%		0.28	%
Allowance for loan losses/period-end loans		1.31			1.28			1.25			1.28			1.39
NPAs/loans and other real estate		1.27			1.25			1.22			1.47			1.71
Allowance for loan losses/nonperforming loans		117.77			115.30			102.93			87.84			83.99
CAPITAL & LIQUIDITY
Period-end tangible equity to assets		10.33	%		10.38	%		10.23	%		9.90	%		10.03	%
Average equity to assets		10.84			10.80			10.49			10.49			10.58
Average equity to loans		15.60			15.13			14.82			15.13			14.97
Average loans to deposits		90.07			91.77			91.44			91.15			93.83
AVERAGE BALANCES
Assets	$	454,685		$	448,205		$	451,666		$	454,657		$	446,099		$	451,523		$	442,590
Earning assets		431,271			424,925			428,686			431,661			423,591			428,303			420,076
Loans		315,750			319,906			319,646			315,348			315,355			318,420			312,943
Deposits		350,577			348,601			349,574			345,962			336,089			335,236			330,061
Shareholders’ equity		49,265			48,389			47,387			47,703			47,213			48,371			46,837
ENDING BALANCES
Assets	$	457,849		$	449,552		$	445,361		$	457,056		$	451,586
Earning assets		435,806			427,281			422,793			434,876			428,895
Loans		313,980			316,581			322,017			315,647			316,909
Deposits		354,856			347,258			348,209			353,491			341,296
Shareholders’ equity		49,191			48,538			47,457			47,154			47,211

NOTES:

(a) - Net Interest income on a fully tax-equivalent (“FTE”) basis restates interest on tax-exempt securities and loans as if such interest were subject to federal income tax at the statutory rate. Net interest income on an FTE basis differs from net interest income under U.S. generally accepted accounting principles.

CSB BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

dollars in thousands, except per share data

	September 30, 2011			September 30, 2010
ASSETS
Cash and cash equivalents
Cash and due from banks	$	9,892,962		$	10,017,003
Interest-earning deposits in other banks		30,965,095			33,267,298
Federal funds sold		—			328,000
Total cash and cash equivalents		40,858,057			43,612,301
Securities
Available-for-sale, at fair-value		85,261,692			72,501,236
Restricted stock, at cost		5,463,100			5,463,100
Total securities		90,724,792			77,964,336
Loans held for sale		136,000			426,900
Loans		313,979,956			316,908,759
Less allowance for loan losses		4,116,496			4,407,101
Net loans		309,863,460			312,501,658
Goodwill and core deposit intangible		2,085,666			2,147,172
Bank owned life insurance		3,041,483			2,933,453
Premises and equipment, net		7,740,313			8,006,587
Accrued interest receivable and other assets		3,398,920			3,993,240
TOTAL ASSETS	$	457,848,691		$	451,585,647
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities
Deposits:
Noninterest-bearing	$	71,139,431		$	63,988,306
Interest-bearing		283,716,081			277,307,388
Total deposits		354,855,512			341,295,694
Short-term borrowings		32,527,224			29,534,082
Other borrowings		19,332,824			31,656,959
Accrued interest payable and other liabilities		1,942,419			1,887,775
	��
Total liabilities		408,657,979			404,374,510
Shareholders’ equity
Common stock, $6.25 par value. Authorized 9,000,000 shares; issued 2,980,602 shares in 2011 and 2010		18,628,767			18,628,767
Additional paid-in capital		9,993,812			9,993,812
Retained earnings		24,063,191			22,209,707
Treasury stock at cost - 245,803 shares in 2011 and 2010		(5,014,541	)		(5,014,541	)
Accumulated other comprehensive income		1,519,483			1,393,392
Total shareholders’ equity		49,190,712			47,211,137
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	457,848,691		$	451,585,647

CSB BANCORP, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

dollars in thousands, except per share data

	Quarter ended September 30,				Nine months ended September 30,
	2011		2010		2011		2010
Interest and dividend income:
Loans, including fees	$	4,232,420	$	4,383,865	$	12,744,873	$	12,971,389
Taxable securities		600,495		665,217		1,808,510		2,063,440
Nontaxable securities		109,674		91,643		309,801		257,672
Other		15,217		18,538		43,245		52,040
Total interest and dividend income		4,957,806		5,159,263		14,906,429		15,344,541
Interest expense:
Deposits		662,915		889,351		2,153,793		2,641,606
Other		197,617		312,564		625,193		1,031,633
Total interest expense		860,532		1,201,915		2,778,986		3,673,239
Net interest income		4,097,274		3,957,348		12,127,443		11,671,302
Provision for loan losses		240,000		238,740		710,000		996,640
Net interest income after provision for loan losses		3,857,274		3,718,608		11,417,443		10,674,662
Non-interest income
Service charges on deposits accounts		286,107		295,148		809,735		850,612
Trust services		156,457		135,414		503,988		401,265
Securities gains (losses), net		236,881		0		236,881		147,763
Gain on sale of loans		54,437		62,489		153,471		153,251
Other		360,124		287,186		935,537		847,568
Total non-interest income		1,094,006		780,237		2,639,613		2,400,459
Non-interest expenses
Salaries and employee benefits		1,856,304		1,751,102		5,412,421		5,099,625
Occupancy expense		207,894		196,842		631,079		608,974
Equipment expense		126,731		124,212		369,726		375,203
Franchise tax expense		135,000		135,000		405,050		405,050
Professional and director fees		200,090		133,788		536,448		457,492
Federal deposit insurance		35,780		108,625		253,614		416,965
Amortization of intangible assets		15,252		15,750		45,756		47,250
Other expenses		931,926		749,786		2,258,294		1,995,762
Total non-interest expenses		3,508,977		3,215,105		9,912,387		9,406,321
Income before income tax		1,442,303		1,283,740		4,144,669		3,668,800
Federal income tax provision		444,100		401,500		1,278,100		1,128,500
Net income	$	998,203	$	882,240	$	2,866,569	$	2,540,300
Net income per share:
Basic	$	0.37	$	0.32	$	1.05	$	0.93
Diluted	$	0.37	$	0.32	$	1.05	$	0.93

Note: Certain prior year balances have been reclassified to conform to the current year presentation.