EXHIBIT 99
CAMCO FINANCIAL ANNOUNCES FOURTH QUARTER 2003 EARNINGS
Friday January 23, 5:03 pm ET
CAMBRIDGE, Ohio--(BUSINESS WIRE)--Jan. 23, 2004--Camco Financial Corporation
(Nasdaq:CAFI - News) reported net earnings for the quarter ended December 31,
2003 of $588,000 or $.09 per basic share as compared with $2.63 million, or $.34
per basic share, for the same quarter in 2002. The quarter ended December 31,
2003 includes expenses associated with the restructuring of a portion of Camco's
Federal Home Loan Bank (FHLB) borrowings amounting to $.11 per basic share.
Excluding the impact of this restructuring, net earnings for the quarter ended
December 31, 2003 were $1.44 million and basic earnings per share for the fourth
quarter of 2003 were $.20.
For the year ended December 31, 2003, Camco reported net earnings of $6.86
million compared with $10.0 million for the year ended 2002. Basic earnings per
share for 2003 were $.92 versus $1.27 for 2002.
Excluding the impact of the restructuring of FHLB borrowings, Camco's net
earnings for the year ended December 31, 2003 were $7.71 million, or $1.03 per
basic share.
Camco President & CEO Richard C. Baylor commented, "2003 was a disappointing
year from an earnings perspective. 2003's income was impacted by the significant
compression that has occurred in our net interest margin from 2.66% in 2002 to
2.34% in 2003, and the rapid decline in residential loan production since June
of 2003. We believe 2004 net income may be lower than 2003 as we anticipate
continued low interest rates that compress our net interest margin. We also do
not expect to generate the level of gains from loan sales as recorded in 2003.
Our current loan production has slowed approximately 60% from the strong levels
of mid-year 2003, and although we closed a record $620 million in loans, we have
only experienced growth in our loan portfolio in the last 6 months. $279 million
of fixed rate loan production was sold to the secondary market for interest rate
risk management purposes. Additionally, the refinancing of loans in 2003
significantly reduced our residential loan portfolio and our volume of interest
income along with it."
Mr. Baylor continued, "In the fourth quarter we restructured $25.35 million of
FHLB borrowings having an average term of 19 months and an average fixed rate of
5.41%, replacing them with variable rate advances having a weighted average rate
of approximately 1% at December 31, 2003. The prepayment fee incurred was
$853,000 on an after tax basis but the positive net earnings impact in 2004
could approach $740,000 or $.10 per share as a result of the reduced borrowing
cost."
Mr. Baylor continued, "We continue to execute our strategic plan to effectively
transition our balance sheet through the funding of higher yielding commercial
real estate and consumer loans with lower cost transaction-based deposit
accounts, thus providing higher net interest margins. Our reliance on higher
cost certificates of deposit has decreased as a percentage of deposits to 54% at
the end of 2003 from 57% at the end of 2002. Also, our deposit funding cost has
decreased to 2.10% at the end of 2003 from 2.86% at the end of 2002."
Baylor added, "One important aspect of our strategic plan is the growth in our
commercial real estate lending and that production increased to $64 million in
2003 from $43 million in 2002, an increase of 46%. We continue to focus on
building this line of business by recruiting seasoned commercial lenders in the
markets we serve. We anticipate that our overall loan production may slow in
2004 from the record level of over $620 million in 2003, which was primarily
driven by the refinance of residential home loans. This will afford us the
opportunity to concentrate on the types of lending and deposit activity that
will increase our margin for future profitability."
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Baylor added, "Another component of our strategic plan is to effectively manage
capital levels. In that regard we continue to coordinate a strong dividend
payout ratio in conjunction with our Stock Repurchase Plan under which we
purchased 54,000 shares in the fourth quarter, leaving us with 236,000 shares
remaining under our current Stock Repurchase Plan. For calendar 2003, Camco's
common stock price increased from $14.21 to $17.33, an increase of 22%, and it
has increased 99% over the past three years. We have also maintained our strong
dividend policy as Camco declared a cash dividend of $0.14 1/2 in the fourth
quarter, payable January 16, 2004. This dividend represents a current annualized
yield of 3.35% on Camco's year-end market value."
Mr. Baylor concluded, "We have been positioned our balance sheet to take
advantage of a rising rate environment that has yet to materialize. If and when
rates do begin to rise we will be in a position to enhance income."
Camco Financial Corporation, holding company for Advantage Bank, is a
multi-state thrift holding company headquartered in Cambridge, Ohio. Advantage
Bank and its affiliates offer community banking, mortgage banking, internet
banking and title services from 32 offices in 23 communities in Ohio, Kentucky
and West Virginia.
Additional information about Camco Financial may be found on Camco's web site:
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.
Financials Attached.
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Camco Financial Corporation
Condensed Consolidated Statements of Earnings
Periods Ended December 31, 2003 and 2002
(In thousands, except for per share data and shares outstanding)
12 Months 12 Months 3 Months 3 Months
Ended Ended Ended Ended
12/31/03 12/31/02 12/31/03 12/31/02
(Unaudited) (Unaudited) (Unaudited)
----------- ----------- -----------
Total Interest Income $54,875 $66,002 $12,922 $15,613
Total Interest Expense 31,237 38,556 7,282 9,037
----------- ---------- ----------- -----------
Net Interest Income 23,638 27,446 5,640 6,576
Provision for Losses on
Loans 1,446 1,169 516 417
----------- ---------- ----------- -----------
Net Interest Income
After Provision for
Loan Losses 22,192 26,277 5,124 6,159
Other Income 11,411 10,100 2,185 3,059
General,
Administrative, and
Other Expense 22,404 21,570 5,214 5,299
Prepayment costs 1,292 0 1,292 0
----------- ---------- ----------- -----------
Net Income - Before
Income Tax 9,907 14,807 803 3,919
----------- ---------- ----------- -----------
Income Tax Expense 3,051 4,802 215 1,289
----------- ---------- ----------- -----------
Reported Net Earnings 6,856 10,005 588 2,630
----------- ---------- ----------- -----------
Adjusted for non-
recurring items
Prepayment costs
(net of tax) 853 0 853 0
----------- ---------- ----------- -----------
Net Earnings from
Operations $7,709 $10,005 $1,441 $2,630
=========== ========== =========== ===========
Earnings Per Share
Reported:
Basic $0.92 $1.27 $0.09 $0.34
Diluted $0.91 $1.25 $0.09 $0.33
Earnings Per Share
Operations:
Basic $1.03 $1.27 $0.20 $0.34
Diluted $1.02 $1.25 $0.20 $0.33
Basic Weighted Number
of Shares Outstanding 7,491,977 7,908,786 7,355,576 7,764,614
Diluted Weighted Number
of Shares Outstanding 7,566,355 8,005,880 7,440,603 7,862,991
Selected Financial
Ratios
Net Interest Margin 2.34% 2.66% 2.29% 2.53%
Reported:
Return on Average
Equity 7.12% 10.33% 2.52% 10.67%
Return on Average
Assets 0.65% 0.92% 0.23% 0.97%
Operations:
Return on Average
Equity 7.95% 10.33% 5.93% 10.67%
Return on Average
Assets 0.72% 0.92% 0.53% 0.97%
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Camco Financial Corporation
Condensed Consolidated Statements of Financial Condition
(In thousands, except for per share data and shares outstanding)
12/31/03 12/31/02
----------- -----------
Assets
- --------------------------------------------
Cash and Cash Equivalents $53,711 $57,022
Investments 113,758 161,489
Loans Held for Sale 5,457 55,493
Loans Receivable 805,266 746,955
Allowance for Loan Loss (5,641) (5,490)
----------- -----------
Loans Receivable, Net 799,625 741,465
Goodwill 2,953 2,953
Other Assets 63,203 64,818
----------- -----------
Total Assets $1,038,707 $1,083,240
=========== ===========
Liabilities
- --------------------------------------------
Deposits $671,274 $694,072
Borrowed Funds 262,735 276,276
Other Liabilities 12,155 14,291
----------- -----------
Total Liabilities 946,164 984,639
Stockholders Equity 92,543 98,601
----------- -----------
Total Liabilities and Stockholders' Equity $1,038,707 $1,083,240
Stockholders' Equity to Total Assets 8.91% 9.10%
Total Shares Outstanding 7,332,422 7,688,885
Book Value Per Share $12.62 $12.82
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Contact:
Camco Financial Corporation
Richard C. Baylor, 740-435-2040
or
Mark A. Severson, 740-435-2055
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