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

Exhibit 99.1

CSB BANCORP, INC. REPORTS FIRST QUARTER EARNINGS

First Quarter Highlights

	Quarter Ended March 31, 2017			Quarter Ended March 31, 2016
Diluted earnings per share	$	0.63		$	0.54
Net Income	$	1,730,000		$	1,480,000
Return on average common equity		10.54	%		9.48	%
Return on average assets		1.05	%		0.93	%

Millersburg, Ohio – April 19, 2017 – CSB Bancorp, Inc. (OTC Pink: CSBB) today announced first quarter 2017 net income of $1,730,000, or $.63 per basic and diluted share, as compared to $1,480,000, or $.54 per basic and diluted share, for the same period in 2016.

Annualized returns on average common equity (“ROE”) and average assets (“ROA”) for the quarter were 10.54% and 1.05%, respectively, compared with 9.48% and 0.93% for the first quarter of 2016.

Eddie Steiner, President and CEO stated, “We are pleased to report strong first quarter earnings. Demand for business and consumer loans remains steady, resulting in higher loan balances and increased earnings.”

Revenue, on a fully-taxable equivalent basis, totaled $7.1 million during the quarter, an 11% increase from the prior-year first quarter. Net interest income increased $577 thousand, or 11%, in the first quarter of 2017 compared to the same period in 2016. Loan interest income including fees increased $707 thousand during first quarter 2017 as compared to the same quarter in 2016. This increase was driven partially by an increase in average loan volume of $53 million across all categories of loans as well as in increase of 14 basis points in loan yield. The net interest margin of 3.85% compared favorably to 3.57% for first quarter 2016.

Noninterest income increased by $114 thousand, or 11%, in the first quarter of 2017 compared to 2016. The increase reflects growth in cash surrender value of life insurance, increases in debit card fee income, growth in service charges on deposit accounts, and the gain on sale of mortgage loans. During 2016 a write-down of fixed assets of $39 thousand occurred during first quarter which did not recur in 2017. The increases were partially offset by a decrease in trust and brokerage fee income.

Noninterest expense amounted to $4.6 million during the quarter, an increase of $657 thousand, or 16%, from first quarter 2016. This increase is attributable to CSB providing a $540 thousand provision for unfunded loan commitments due to the impairment of a commercial line of credit. Salary and employee benefits rose $132 thousand, or 6%, on a quarter over prior year quarter with increases in salary, healthcare, and employment taxes. The Company’s first quarter efficiency ratio amounted to 65.4% as compared to 62.2% for the same quarter in the prior year.

Federal income tax provision totaled $752 thousand in first quarter 2017, compared to $644 thousand for the same quarter in 2016 reflecting a slightly decreased effective tax rate in 2017 from an increase in nontaxable income.

Average total assets during the quarter amounted to $667 million, an increase of $26 million, or 4%, above the same quarter of the prior year. Average loan balances of $481 million increased $53 million, or 12%, from the prior year first quarter while average securities balances of $133 million decreased $27 million, or 17%, as compared to first quarter 2016.

Average commercial loan balances for the quarter, including commercial real estate, increased $28 million, or 10%, from prior year levels. Average residential mortgage balances increased $16 million, or 19%, over the prior year’s quarter. Average home equity balances increased $4 million, or 9%, and average consumer credit balances increased $4 million, or 41%, versus the same quarter of the prior year.

Delinquent loan balances as of March 31, 2017 amounted to 1.25% of total loans as compared to 0.63% at March 31, 2016. Nonperforming assets totaled $4.9 million, or 1.02%, of total loans plus other real estate, an increase of $3 million over March 31, 2016. The allowance for loan losses amounted to 1.13% of total loans on March 31, 2017 as compared to 1.15% at March 31, 2016.

Net loan recoveries recognized during first quarter 2017 were $323 thousand, or 0.27% annualized, compared to first quarter 2016 net loan recoveries of $179 thousand.

Average deposit balances for first quarter 2017 totaled $531 million, an increase of $19 million, or 4%, from the prior year’s first quarter. Within the deposit category, average noninterest-bearing account balances for the first quarter increased by $24 million, or 17%, above the same period in the prior year. Average interest-bearing checking, money market, and traditional savings balances increased $2 million, or 1%, from year ago levels, while average time deposit balances decreased $7 million, or 6%, from first quarter 2016. In addition to the changes in average deposit balances, the average balance of securities sold under repurchase agreement during the first quarter of 2017 increased by $3 million, or 6%, compared to the average for the same period in the prior year. Repurchase agreements, while considered short-term borrowings, are primarily tied to overnight customer sweep accounts.

Shareholders’ equity totaled $66.9 million on March 31, 2017 with 2.7 million common shares outstanding. The tangible equity to assets ratio amounted to 9.2% on March 31, 2017, as compared to 9.1% on March 31, 2016. The Company declared a first quarter dividend of $0.20 per share producing an annualized yield of 2.6% based on the March 31, 2017 closing price of $31.00.

About CSB Bancorp, Inc.

CSB is a financial holding company headquartered in Millersburg, Ohio, with approximate assets of $680 million as of March 31, 2017. 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 sixteen banking centers in Holmes, Wayne, Tuscarawas, and Stark counties and Trust offices located in Millersburg, North Canton, 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)	Quarters
(Dollars in thousands, except per share data)	2017			2016			2016			2016			2016
EARNINGS	1st Qtr			4th Qtr			3rd Qtr			2nd Qtr			1st Qtr
Net interest income FTE (a)	$	5,955		$	6,022		$	5,597		$	5,539		$	5,373
Provision for loan losses		(160	)		—			164			165			164
Other income		1,106			1,112			1,095			1,097			992
Other expenses		4,646			4,210			3,994			4,062			3,989
FTE adjustment (a)		93			91			100			93			88
Net income		1,730			1,953			1,694			1,611			1,480
Diluted earnings per share		0.63			0.72			0.61			0.59			0.54
PERFORMANCE RATIOS
Return on average assets (ROA)		1.05	%		1.17	%		1.03	%		1.00	%		0.93	%
Return on average common equity (ROE)		10.54	%		11.76	%		10.29	%		10.14	%		9.48	%
Net interest margin FTE (a)		3.85	%		3.83	%		3.61	%		3.65	%		3.57	%
Efficiency ratio		65.39	%		58.59	%		59.23	%		60.76	%		62.20	%
Number of full-time equivalent employees		164			165			165			166			162
MARKET DATA
Book value/common share	$	24.41		$	23.85		$	23.98		$	23.49		$	22.90
Period-end common share mkt value		31.00			31.00			25.17			25.20			24.25
Market as a % of book		127.00	%		129.98	%		104.96	%		107.28	%		105.90	%
Price-to-earnings ratio		12.16			12.60			10.80			11.00			10.78
Cash dividends/common share	$	0.20		$	0.20		$	0.20		$	0.19		$	0.19
Common stock dividend payout ratio		31.75	%		27.78	%		32.79	%		32.20	%		35.19	%
Average basic common shares		2,742,242			2,742,242			2,742,242			2,742,242			2,741,379
Average diluted common shares		2,742,242			2,742,242			2,742,242			2,742,242			2,741,379
Period end common shares outstanding		2,742,242			2,742,242			2,742,242			2,742,242			2,742,242
Common shares repurchased		0			0			0			0			0
Common stock market capitalization	$	85,010		$	85,010		$	69,022		$	69,104		$	66,499
ASSET QUALITY
Gross charge-offs	$	13		$	44		$	346		$	18		$	10
Net (recoveries) charge-offs		(323	)		(289	)		318			14			(179	)
Allowance for loan losses		5,454			5,291			5,002			5,156			5,005
Nonperforming assets (NPAs)		4,909			1,684			2,849			2,806			1,915
Netcharge-off (recovery) /average loans ratio		(0.27	)%		(0.25	)%		0.27	%		0.01	%		(0.17	)%
Allowance for loanlosses/period-end loans		1.13			1.11			1.08			1.14			1.15
NPAs/loans and other real estate		1.02			0.35			0.62			0.62			0.44
Allowance for loan losses/nonperforming loans		111.10			314.19			177.61			188.59			261.35
CAPITAL & LIQUIDITY
Period-end tangible equity to assets		9.17	%		9.07	%		9.34	%		9.19	%		9.11	%
Average equity to assets		9.98			9.95			10.02			9.88			9.77
Average equity to loans		13.85			14.25			14.33			14.29			14.63
Average loans to deposits		90.45			87.15			87.89			86.71			83.55
AVERAGE BALANCES
Assets	$	666,650		$	664,158		$	653,635		$	646,642		$	640,670
Earning assets		627,520			625,320			616,555			610,138			604,911
Loans		480,656			463,725			456,865			447,009			427,916
Deposits		531,380			532,102			519,828			515,511			512,192
Shareholders’ equity		66,560			66,094			65,471			63,877			62,625
ENDING BALANCES
Assets	$	679,437		$	669,978		$	654,391		$	649,890		$	637,202
Earning assets		640,113			631,069			617,264			610,221			602,306
Loans		480,709			475,449			463,211			450,789			433,453
Deposits		542,180			540,785			522,240			516,497			509,980
Shareholders’ equity		66,927			65,415			65,751			64,407			62,796

NOTES:

(a) - Net Interest income on a fullytax-equivalent (“FTE”) basis restates interest ontax-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)	March 31, 2017			March 31, 2016
(Dollars in thousands, except per share data)
ASSETS
Cash and cash equivalents
Cash and due from banks	$	13,911		$	12,527
Interest-earning deposits in other banks		24,476			14,844
Federal Funds Sold		—			—
Total cash and cash equivalents		38,387			27,371
Securities
Available-for-sale, at fair-value		102,158			122,242
Held-to-maturity		27,892			27,025
Restricted stock, at cost		4,614			4,614
Total securities		134,664			153,881
Loans held for sale		264			128
Loans		480,709			433,453
Less allowance for loan losses		5,454			5,005
Net loans		475,255			428,448
Goodwill and core deposit intangible		5,082			5,202
Bank owned life insurance		12,959			10,152
Premises and equipment, net		8,656			8,032
Accrued interest receivable and other assets		4,170			3,988
TOTAL ASSETS	$	679,437		$	637,202
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities
Deposits:
Noninterest-bearing	$	171,235		$	145,967
Interest-bearing		370,945			364,013
Total deposits		542,180			509,980
Short-term borrowings		54,022			48,787
Other borrowings		12,304			13,332
Accrued interest payable and other liabilities		4,004			2,307
Total liabilities		612,510			574,406
Shareholders’ equity
Common stock, $6.25 par value. Authorized 9,000,000 shares; issued 2,980,602 shares in 2017 and 2016		18,629			18,629
Additionalpaid-in capital		9,815			9,815
Retained earnings		43,810			38,989
Treasury stock at cost - 238,360 shares in 2017 and 2016		(4,784	)		(4,784	)
Accumulated other comprehensive (loss) gain		(543	)		147
Total shareholders’ equity		66,927			62,796
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	679,437		$	637,202

CSB BANCORP, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)	Quarter ended March 31,
(Dollars in thousands, except per share data)	2017			2016
Interest and dividend income:
Loans, including fees	$	5,449		$	4,742
Taxable securities		598			737
Nontaxable securities		165			154
Other		34			28
Total interest and dividend income		6,246			5,661
Interest expense:
Deposits		267			259
Other		117			117
Total interest expense		384			376
Net interest income		5,862			5,285
Provision for loan losses		(160	)		164
Net interest income after provision for loan losses		6,022			5,121
Noninterest income
Service charges on deposits accounts		291			278
Trust services		207			226
Debit card interchange fees		288			262
Gain on sale of loans		42			32
Gain on sale of securities		—			—
Other		278			194
Total noninterest income		1,106			992
Noninterest expenses
Salaries and employee benefits		2,459			2,327
Occupancy expense		210			244
Equipment expense		170			174
Professional and director fees		169			174
Software expense		210			187
Marketing and public relations		78			85
Debit card expense		130			104
Provision for unfunded loan commitments		540			—
Other expenses		680			694
Total noninterest expenses		4,646			3,989
Income before income tax		2,482			2,124
Federal income tax provision		752			644
Net income	$	1,730		$	1,480
Net income per share:
Basic	$	0.63		$	0.54
Diluted	$	0.63		$	0.54