Cascade Financial Corp. (CASB) filed Quarterly Report for the period ended 2009-09-30.
Cascade Bancorp is a bank holding company. The company through its subsidiaries offers a broad range of commercial and personal banking services to its customers. The bank focuses its lending activities primarily on small to medium-sized businesses in diversified industries. In addition the bank provides real estate construction and development loans municipal and industrial loans consumer loans and originates and sells residential mortgage loans. Cascade Financial Corp. has a market cap of $26.2 million; its shares were traded at around $2.16 with and P/S ratio of 0.3. Cascade Financial Corp. had an annual average earning growth of 22% over the past 5 years.
Highlight of Business Operations:
Total assets increased 0.6% or $9.7 million to $1.65 billion at September 30, 2009, compared to $1.64 billion at December 31, 2008. Net loans, i.e. net of deferred loan fees and the allowance for loan losses, decreased 2.9% or $36.0 million to $1.20 billion at September 30, 2009, from $1.24 billion at December 31, 2008.
During the quarter, the available-for-sale portfolio grew by $14.2 million and the held-to-maturity portfolio declined by $11.3 million. Of this decline, $10.0 million was a result of calls of agency notes and $1.3 million represented paydowns on MBS. Purchases resulting from the proceeds from calls, in addition to the incremental purchases, were all designated available-for-sale to increase flexibility in managing the portfolio.
Net loans decreased by $36.0 million to $1.20 billion as of September 30, 2009, compared to $1.24 billion at December 31, 2008. Total originations exceeded payoffs by $9.3 million. However, the transfer from the loan portfolio of $9.6 million to REO, net charge-offs of $27.2 million and an increase in the allowance for loan losses of $8.3 million resulted in the lower net loan balance.
Within the portfolio, reclassifications from the construction portfolio to commercial real estate of $59.6 million, multifamily of $6.8 million and residential of $6.2 million combined with charge-offs of $26.3 million, transfers of $9.6 million to REO, and payoffs of $13.1 million, reduced the construction portfolio by $121.6 million. In those cases, the reclassified loans were secured by projects that had been completed and have begun to generate sufficient cash flow to justify the reclassifications.
At September 30, 2009, the Corporation has a $10.4 million current tax asset. The receivable is the result of tax carry-backs that the Corporation will recognize due to losses that have been recorded in 2009 and to OTTI charges taken in 2008 on Fannie Mae and Freddie Mac preferred stock. On September 7, 2008, the U.S. Treasury, the Federal Reserve and the Federal Housing Finance Agency (FHFA) announced that FHFA was placing Fannie Mae and Freddie Mac under conservatorship and would eliminate dividends on Fannie Mae and Freddie Mac common and preferred stock. The Corporation recorded a pre-tax OTTI charge of $17.3 to third quarter 2008 earnings and an additional charge of $858,000 in the first quarter of 2009. The sale of Fannie Mae and Freddie Mac preferred stock during the year will allow the Corporation to recover more than $6.3 million in taxes for the 2009 tax return and accounts for a large portion of the current tax asset.
Savings and money market accounts (MMDA) decreased $75.1 million to $128.9 million at September 30, 2009 compared to December 31, 2008. Municipalities reduced their balances by $74.0 million as the Bank sought to reduce and realign its level of public deposits in light of the $368,000 assessment paid by the Bank in the first quarter. This assessment by the Washington Public Deposit Protection Commission was used to cover the uninsured deposits associated with the failure of the Bank of Clark County. Total CDs decreased $39.8 million to $576.1 million as the balance on brokered CDs declined $71.9 million to $179.9 million at September 30, 2009 compared to December 31, 2008.
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