CAMCO FINANCIAL & SUBSIDIARIES
SALARY SAVINGS PLAN
Cambridge, Ohio
FINANCIAL STATEMENTS
December 31, 2002 and 2001
CAMCO FINANCIAL & SUBSIDIARIES
SALARY SAVINGS PLAN
Cambridge, Ohio
FINANCIAL STATEMENTS
December 31, 2002 and 2001
CONTENTS
REPORT OF INDEPENDENT AUDITORS ........................................ 1
FINANCIAL STATEMENTS
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS .................. 2
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS ........ 3
NOTES TO FINANCIAL STATEMENTS .................................... 4
SUPPLEMENTAL INFORMATION
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS (HELD AT END OF YEAR).... 10
REPORT OF INDEPENDENT AUDITORS
Trustees
Camco Financial & Subsidiaries
Salary Savings Plan
Cambridge, Ohio
We have audited the accompanying statements of net assets available for benefits
of the Camco Financial & Subsidiaries Salary Savings Plan as of December 31,
2002 and 2001 and the related statement of changes in net assets available for
benefits for the year ended December 31, 2002. These financial statements are
the responsibility of the plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as of
December 31, 2002 and 2001, and the changes in net assets available for benefits
for the year ended December 31, 2002 in conformity with accounting principles
generally accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of Schedule H,
Line 4i - Schedule of Assets (Held At End Of Year) is presented for the purpose
of additional analysis and is not a required part of the basic financial
statements but is supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The supplemental schedule has been
subjected to the auditing procedures applied in the audit of the financial
statements and, in our opinion, is fairly stated in all material respects in
relation to the basic financial statements taken as a whole.
/s/Crowe, Chizek and Company LLP
Columbus, Ohio
February 6, 2003
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1.
CAMCO FINANCIAL & SUBSIDIARIES
SALARY SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
December 31, 2002 and 2001
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2002 2001
ASSETS
Investments (Note 4) $8,849,825 $8,601,589
Receivables
Employee contribution 25,451 23,067
Employer matching contribution 13,059 12,034
Employer profit sharing contribution 86,944 72,209
--------- ---------
125,454 107,310
--------- ---------
NET ASSETS AVAILABLE FOR BENEFITS $8,975,279 $8,708,899
========= =========
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See accompanying notes to financial statements.
2.
CAMCO FINANCIAL & SUBSIDIARIES
SALARY SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
Year ended December 31, 2002
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Additions to net assets attributed to
Net depreciation in fair value of investments (Notes 2 and 4) $ (517,315)
Interest and dividends 208,188
---------
(309,127)
Contributions
Employer 387,550
Participants 596,018
Rollovers 365,613
---------
1,349,181
---------
Total additions 1,040,054
Deductions from net assets attributed to
Administrative expenses 37,117
Benefits paid to participants 736,557
---------
Total deductions 773,674
Net increase 266,380
Net assets available for benefits
Beginning of year 8,708,899
---------
End of year $8,975,279
=========
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See accompanying notes to financial statements.
3.
CAMCO FINANCIAL & SUBSIDIARIES
SALARY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 2002 and 2001
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NOTE 1 - DESCRIPTION OF PLAN
The following description of the Camco Financial & Subsidiaries Salary Savings
Plan (the "Plan") provides only general information. Participants should refer
to the Plan agreement for a more complete description of the Plan's provisions.
General: The Plan is a defined-contribution plan covering all employees of Camco
Financial & Subsidiaries and related subsidiaries, collectively referred to as
the "Company." The Plan requires employees to complete one year of service
(1,000 hours or more) to participate in the Plan. It is subject to the
provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
Contributions: Each year, participants may contribute up to 15% of their pretax
annual compensation to the Plan. Participants may also contribute amounts
representing distributions from other qualified defined benefit or defined
contribution plans. The Company makes a matching contribution equal to 100% of
401(k) deferrals made up to the first 3% of base compensation and 50% of 401(k)
deferrals from 3.01% to 5% of base compensation. The Company may make an
additional employer discretionary contribution. Contributions are subject to
certain Internal Revenue Code ("IRC") limitations.
Investment Options: The Plan allows participants to direct the investment of
their plan assets, including half of their employer discretionary and all of
their employer matching contributions, among several different investment
options offered by the Plan. The other half of the employer discretionary
contribution is trustee directed and invested solely in Camco Financial
Corporation common stock.
Participant Accounts: Each participant's account is credited with the
participant's own contribution, and an allocation of (a) the Company's
contributions and (b) investment income. Allocation of the Company's
contributions and investment income is based upon participants' compensation and
account balances, respectively. The benefit to which a participant is entitled
is the benefit that can be provided from the participant's account.
Retirement, Death, and Disability: A participant is entitled to 100% of his or
her account balance upon retirement (at normal retirement age), death, or
disability.
Forfeited Accounts: Forfeitures of terminated participants' nonvested employer
profit sharing accounts are reallocated to all eligible participants.
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(Continued)
4.
CAMCO FINANCIAL & SUBSIDIARIES
SALARY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 2002 and 2001
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NOTE 1 - DESCRIPTION OF PLAN (Continued)
Vesting: Participants are immediately vested in their own 401(k) contributions,
employer matching contributions made after December 31, 1997 and any Pension
Plan rollovers, plus actual earnings thereon. Vesting in the remainder of their
account is based on years of credited service. A participant is 100% vested
after six years of credited service in accordance with the table below:
Years of Service % Vested
1 0
2 20
3 40
4 60
5 80
6 100
Payment of Benefits: Upon termination of service, a participant may elect to
receive payment of their vested benefits, either as a lump-sum payment or as a
series of installment payments.
Loan Provisions: The Plan provides that participants can borrow funds against
their vested account balance. These loans are limited to the lesser of $50,000
or 50% of the participant's vested account balance. The loan must be repaid
within five years, and the loan must bear interest at a reasonable rate.
NOTE 2 - SUMMARY OF ACCOUNTING POLICIES
The principles and policies that significantly affect the determination of net
assets available for benefits and results of operations are summarized below.
Accounting Method: The accounting principles followed by the Plan conform to
accounting principles generally accepted in the United States of America. The
financial statements were prepared using the accrual method of accounting.
Income and Expense Recognition: Investment income includes dividends, interest,
gains or losses realized on the sale of plan assets and unrealized gains and
losses of assets held the entire plan year. Employer and employee contributions
and expenses payable are recognized on the accrual method. Benefits to
participants are recorded when paid.
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(Continued)
5.
CAMCO FINANCIAL & SUBSIDIARIES
SALARY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 2002 and 2001
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NOTE 2 - SUMMARY OF ACCOUNTING POLICIES (Continued)
Valuation of Investments: Quoted market prices are used to value the Plan's
investments in mutual funds and common stock. Participant loans are carried at
their outstanding principal balance, which approximates fair value. The Plan's
investment in the common/collective investment fund is valued based upon the
Plan's proportional share of the common/collective fund's underlying asset which
is another common/collective fund. The underlying common/collective fund is
valued based upon the fair market value of the fund's underlying assets.
Estimates: The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts
and disclosures and actual results could differ from those estimates. It is at
least reasonably possible that a significant change may occur in the near term
for the estimates of investment valuation.
Risk and Uncertainties: The Plan provides for various investment options
including any combination of mutual funds, Camco Financial common stock,
common/collective funds and other investment securities. The underlying
investment securities are exposed to various risks, such as interest rate,
market and credit risks. Due to the level of risk associated with certain
investment securities and the level of uncertainty related to changes in the
value of investment securities, it is at least reasonably possible that changes
in the values of investment securities will occur in the near term and that such
changes could materially affect the amounts reported in the statement of net
assets available for benefits and participants' individual account balances.
NOTE 3 - PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate the
Plan subject to the provisions of ERISA and its related regulations. In the
event of a plan termination, participants will become 100% vested in their
accounts.
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(Continued)
6.
CAMCO FINANCIAL & SUBSIDIARIES
SALARY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 2002 and 2001
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NOTE 4 - INVESTMENTS
The following table presents investments that represent 5% or more of the Plan's
net assets.
December 31,
2002 2001
Investments at fair value as determined by quoted market prices
Mutual funds
Dreyfus Founders Discovery Fund $ 421,725 $ 557,857
Gabelli Growth Fund 542,536 765,497
Neuberger Berman Genesis Trust Fund 582,134 387,757
Scudder Growth & Income Fund 792,498 1,003,790
Common/collective funds
MCM Stable Value Portfolio 621,981 547,934
Common stock
Camco Financial & Subsidiaries 3,686,549 3,454,084
Camco Financial & Subsidiaries * 409,652 350,712
* Nonparticipant directed investment
During 2002, the Plan's investments earned interest and dividend income of
$208,188.
Also during 2002, the Plan's investments (including investments bought and sold,
as well as held during the year) depreciated in value by $517,315 for the year
ended December 31, 2002 as follows:
Mutual funds $(1,001,112)
Common/collective fund 30,999
Common stock 452,798
$ (517,315)
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(Continued)
7.
CAMCO FINANCIAL & SUBSIDIARIES
SALARY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 2002 and 2001
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NOTE 5 - NONPARTICIPANT - DIRECTED INVESTMENTS
Information about the net assets and the significant components of the changes
in net assets relating to the nonparticipant-directed investments is as follows.
December 31,
2002 2001
Net assets:
Common stock $409,652 $350,712
Year ended
December 31, 2002
Changes in net assets
Contributions $36,793
Loan principal payments 751
Dividends and Interest 15,275
Net appreciation 44,314
Benefits paid to participants (33,117)
Participant loans issued (5,058)
Administrative expenses (18)
------
$58,940
======
NOTE 6 - RELATED PARTY TRANSACTIONS
Parties-in-interest are defined under DOL regulations as any fiduciary of the
Plan, any party rendering service to the Plan, the employer, and certain others.
The Company pays certain administrative fees on behalf of the Plan. Fees paid by
the Plan for investment management services amounted to $37,117 for the year
ended December 31, 2002.
The Plan held the following party-in-interest investments (at fair value) at
December 31, 2002 and 2001:
2002 2001
Camco Financial & Subsidiaries common stock $4,096,201 $3,806,724
CitiStreet S&P 500 Fund 24,627 --
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(Continued)
8.
CAMCO FINANCIAL & SUBSIDIARIES
SALARY SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 2002 and 2001
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NOTE 7 - TAX STATUS
The Internal Revenue Service has determined and informed the Plan by a letter
dated August 9, 1995 that the Plan and related trust are designed in accordance
with applicable sections of the Internal Revenue Code (IRC). The Plan has been
restated in its entirety using a non-standardized prototype plan document
sponsored by Travelers Insurance Company since receiving the favorable
determination letter. However, the plan administrator believes that the Plan is
designed and is currently being operated in compliance with the applicable
requirements of the IRC.
The Plan Document is in the process of being restated for recent law changes.
NOTE 8 - TERMINATED PARTICIPANTS
Included in net assets available for benefits are amounts allocated to
individuals who have elected to withdraw from the Plan, but have not been paid.
As of December 31, 2002 and 2001, amounts allocated to these individuals totaled
$404 and $7,326, respectively.
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(Continued)
9.
SUPPLEMENTAL INFORMATION
CAMCO FINANCIAL & SUBSIDIARIES
SALARY SAVINGS PLAN
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS
(HELD AT END OF YEAR)
December 31, 2002
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Name of plan sponsor: Camco Financial & Subsidiaries
Employer identification number: 51-0110823
Three-digit plan number: 002
(c)
Description of
Investment Including
(b) Maturity Date, Rate of (e)
Identity of Issuer, Borrower Interest, Collateral, Par (d) Current
(a) Lessor, or Similar Party or Maturity Value Cost Value
* Camco Financial & Subsidiaries Common stock,
287,765 shares 2,791,264 $4,096,201
Dreyfus Founders Balanced Fund Mutual Fund @ 271,502
Dreyfus Founders Discovery Fund Mutual Fund @ 421,725
Gabelli Growth Fund Mutual Fund @ 542,536
Janus Twenty Fund Mutual Fund @ 338,047
Loomis Sayles Bond Fund Mutual Fund @ 79,399
MCM Stable Value Portfolio Common/Collective
Fund @ 621,981
Neuberger Berman Genesis Trust Mutual Fund @ 582,134
Pilgrim GNMA Income Fund Mutual Fund @ 101,076
Scudder Growth & Income Fund Mutual Fund @ 792,498
Scudder International Fund Mutual Fund @ 352,018
Stein Roe Intermediate Bond Fund Mutual Fund @ 193,461
Warburg Pincus Global Fixed-Income Fund Mutual Fund @ 118,221
Dreyfus Premier Core Value Fund Mutual Fund @ 83,997
JP Morgan Fleming Emerging Markets Mutual Fund @ 102,861
* CitiStreet S&P 500 Fund Mutual Fund @ 24,627
* Participant notes Bearing interest at 6.75% to 11.5% - 127,541
---------
$8,849,825
=========
* Denotes party-in-interest
@ Participant-directed investment. Cost basis disclosure is not required.
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10.