# CSB Bancorp, Inc.: Form 10-Q for the period ended Jun 30, 2019

- Company: [CSB Bancorp, Inc.](/companies/csbb.md) (CIK 880417)
- Form: 10-Q
- Filed: 2019-08-08
- Accepted by EDGAR: Aug 8, 2019, 15:10 ET
- Period: 2019-06-30
- Accession: 0001193125-19-216697
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/880417/000119312519216697/d750961d10q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/880417/000119312519216697/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2019-06-30.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Interest expense | 3 months, 2019-04-01 to 2019-06-30 | $1.1m | us-gaap:InterestExpense |
| Interest expense | 6 months, 2019-01-01 to 2019-06-30 | $2.0m | us-gaap:InterestExpense |
| Income tax | 3 months, 2019-04-01 to 2019-06-30 | $613.0k | us-gaap:IncomeTaxExpenseBenefit |
| Income tax | 6 months, 2019-01-01 to 2019-06-30 | $1.2m | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2019-04-01 to 2019-06-30 | $2.6m | us-gaap:NetIncomeLoss |
| Net income | 6 months, 2019-01-01 to 2019-06-30 | $5.1m | us-gaap:NetIncomeLoss |
| Diluted EPS | 6 months, 2019-01-01 to 2019-06-30 | $1.87 | us-gaap:EarningsPerShareBasicAndDiluted |
| Operating cash flow | 6 months, 2019-01-01 to 2019-06-30 | $4.5m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 6 months, 2019-01-01 to 2019-06-30 | $2.0m | us-gaap:PaymentsToAcquireProductiveAssets |
| Dividends paid | 6 months, 2019-01-01 to 2019-06-30 | $713.0k | us-gaap:PaymentsOfDividendsCommonStock |
| Total assets | at 2019-06-30 | $750.3m | us-gaap:Assets |
| Total liabilities | at 2019-06-30 | $668.8m | us-gaap:Liabilities |
| Shareholders' equity | at 2019-06-30 | $81.5m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 22,390 characters.

The following management’s discussion and analysis focuses on the consolidated financial condition of the Company at June 30, 2019 as compared to December 31, 2018, and the consolidated results of operations for the three and six month periods ended June 30, 2019 compared to the same periods in 2018. The purpose of this discussion is to provide the reader with a more thorough understanding of the Consolidated Financial Statements. This discussion should be read in conjunction with the interim Consolidated Financial Statements and related footnotes contained in Part I, Item 1 of this Quarterly Report.

### FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report are not historical facts but rather are forward-looking statements that are subject to certain risks and uncertainties. When used herein, the terms “anticipates”, “plans”, “expects”, “believes”, and similar expressions as they relate to the Company or its management are intended to identify forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Company’s actual results, performance or achievements may materially differ from those expressed or implied in the forward-looking statements. Risks and uncertainties that could cause or contribute to such material differences include, but are not limited to, general economic conditions, interest rate environment, competitive conditions in the financial services industry, changes in law, governmental policies and regulations, and rapidly changing technology affecting financial services. Other factors not currently anticipated may also materially and adversely affect the Company’s results of operations, cash flows, and financial position. There can be no assurance that future results will meet expectations. While the Company believes that the forward-looking statements in this report are reasonable, the reader should not place undue reliance on any forward-looking statement.

The Company does not undertake, and specifically disclaims any obligation, to publicly revise 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, except as may be required by applicable law.

### FINANCIAL CONDITION

Total assets were $750 million at June 30, 2019 as compared to $732 million at December 31, 2018. During the six month period ended June 30, 2019, net loans increased $1 million. Cash and cash equivalents, and securities increased $11 million. On the liability side, deposits and repurchase agreements increased by $15 million.

Net loans increased $1 million, or less than 1%, during the six months ended June, 30, 2019 as business lines of credits decreased on the improved cash flow of businesses within the bank’s markets. Commercial loans decreased $6 million, or 4%, while construction and land development loans decreased $19 million, contributing to the increase in commercial real estate loans by $19 million as construction loans moved to permanent financing. Residential real estate loans increased $7 million, or 4%, and consumer loans increased $497 thousand, or 3%, from December 31, 2018. Consumers continued to refinance their mortgage loans for historically low long-term fixed rates while home purchase activity has increased. Residential mortgage loan originations for the six months ended June 30, 2019 totaled $28 million, a decrease from $31 million in originations during the six month period ended June 30, 2018. Originations sold into the secondary market were $5.9 million and $4.3 million, respectively during the six month periods ended June 30, 2019 and June 30, 2018. The Bank originates and sells primarily fixed-rate thirty year mortgages into the secondary market.

The allowance for loan losses as a percentage of total loans was 1.19% at June 30, 2019 as compared to 1.08% at December 31, 2018. Outstanding loan balances increased 1% to $551 million at June 30, 2019. The allowance for loan losses increased to $6.5 million at June 30, 2019 following a provision of $570 thousand and net loan recoveries of $60 thousand for the current six months ended June 30, 2019.

Nonaccrual loans increased during the first six months of 2019. For the six months ending June 30, 2019 loans totaling $1.9 million were placed on nonaccrual status, there were $32 thousand in charge-downs recognized, and pay downs of $673 thousand were received.

*(Dollars in thousands)*

|  | June 30, 2019 | December 31, 2018 | June 30, 2018 |
| --- | ---: | ---: | ---: |
| Non-performing loans | $4,497 | $3,329 | $4,399 |
| Other real estate | 99 | 99 | — |
| Repossessed assets | — | — | — |
| Allowance for loan losses | 6,537 | 5,907 | 5,918 |
| Total loans | 550,612 | 548,974 | 535,427 |
| Allowance: Loans | 1.19% | 1.08% | 1.11% |
| Allowance: Non-performing loans | 1.5 x | 1.8 x | 1.3 x |

The ratio of gross loans to deposits was 88.3% at June 30, 2019, compared to 90.5% at December 31, 2018.

The Company has no exposure to government-sponsored enterprise preferred stocks, collateralized debt obligations, or trust preferred securities. Management has considered industry analyst reports, sector credit reports, and the volatility within the bond market in concluding that the gross unrealized gains of $53 thousand within the available-for-sale and held-to-maturity portfolios as of June 30, 2019, were primarily the result of customary and expected fluctuations in the bond market and not necessarily the expected cash flows of the individual securities. As a result, all embedded security impairments on June 30, 2019, are considered temporary and no impairment loss relating to these securities has been recognized.

Deposits increased $17 million, or 3%, from December 31, 2018 with noninterest bearing deposits decreasing approximately $5 million and interest-bearing deposit accounts increasing approximately $22 million. Total deposits as of June 30, 2019 are $28 million greater than June 30, 2018 deposit balances. On a year over year comparison, increases were recognized in noninterest-bearing demand deposits of $2 million, interest-bearing demand deposits of $13 million, money market accounts of $2 million, savings of $3 million, and time deposits of $8 million.

Short-term borrowings consisting of overnight repurchase agreements with retail customers decreased $2 million to $35 million at June 30, 2019 as compared to December 31, 2018 and other borrowings decreased $1.9 million as the Company repaid FHLB advances.

Total shareholders’ equity amounted to $81 million, or 10.9%, of total assets at June 30, 2019 up slightly from December 31, 2018. The increase in shareholders’ equity during the six months ending June 30, 2019 was due to net income of $5.1 million and an increase in accumulated other comprehensive income of $1.2 million offset by dividends declared of $1.4 million. The Company and the Bank met all regulatory capital requirements at June 30, 2019.

### RESULTS OF OPERATIONS

### Three months ended June 30, 2019 and 2018

For the quarters ended June 30, 2019 and 2018, the Company recorded net income of $2.6 million and $2.3 million and $.94 and $.85 per share, respectively. The $262 thousand increase in net income for the quarter was primarily the result of a $419 thousand increase in net interest income, an increase of $145 thousand in other noninterest income, and a decrease in the provision for loan losses of $39 thousand. The increases were partially offset by an increase of $281 thousand in other noninterest expenses and a $60 thousand increase in federal income tax provision.

Return on average assets and return on average equity were 1.39% and 12.91%, respectively, for the three month period of 2019, compared to 1.30% and 12.94%, respectively for the same quarter in 2018.

### Average Balance Sheets and Net Interest Margin Analysis

*(Dollars in thousands)*

| ASSETS | For the three months ended June 30, 2019 Average balance | Average rate | 2018 Average balance | Average rate |
| --- | ---: | ---: | ---: | ---: |
| Fedeeral funds sold | $212 | 2.08% | $621 | 1.74% |
| Interest-earning deposits with other banks | 39,772 | 2.19 | 19,960 | 1.61 |
| Taxable securities | 87,942 | 2.66 | 93,170 | 2.57 |
| Tax-exempt securities | 23,322 | 2.92 | 26,096 | 2.92 |
| Loans | 547,981 | 5.26 | 534,852 | 4.89 |
| Total earning assets | 699,229 | 4.68% | 674,699 | 4.39% |
| Other assets | 46,429 |  | 41,203 |  |
| **TOTAL ASSETS** | $745,658 |  | $715,902 |  |
| **LIABILITIES AND SHAREHOLDERS’ EQUITY** |  |  |  |  |
| Interest-bearing demand deposits | $127,211 | 0.46% | $118,506 | 0.30% |
| Savings deposits | 186,179 | 0.54 | 181,097 | 0.33 |
| Time deposits | 124,001 | 1.69 | 116,824 | 1.11 |
| Other borrowed funds | 44,803 | 1.15 | 52,592 | 1.01 |
| Total interest bearing liabilities | 482,194 | 0.87% | 469,019 | 0.59% |
| Non-interest bearing demand deposits | 180,167 |  | 172,784 |  |
| Other liabilities | 2,959 |  | 2,060 |  |
| Shareholders’ Equity | 80,338 |  | 72,039 |  |
| **TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY** | $745,658 |  | $715,902 |  |
| Taxable equivalent net interest spread |  | 3.81% |  | 3.80% |
| Taxable equivalent net interest margin |  | 4.08% |  | 3.98% |

Interest income for the quarter ended June 30, 2019, was $8.1 million representing a $777 thousand increase, or an 11% improvement, compared to the same period in 2018. This increase was primarily due to average loan rates increasing 37 basis points as well as a volume increase of $13 million for the quarter ended June 30, 2019 as compared to the second quarter 2018. Interest expense for the quarter ended June 30, 2019 was $1.1 million, an increase of $358 thousand, or 52%, from the same period in 2018. The increase in interest expense occurred primarily due to an increase in rate on all interest-bearing liabilities for the quarter ended June 30, 2019.

For the quarter ended June 30, 2019, the provision for loan losses was $285 thousand, compared to a provision of $324 thousand provision for the same quarter in 2018. For more discussion see Financial Condition. The provision for loan losses is determined based on management’s calculation of the adequacy of the allowance for loan losses, which includes provisions for classified loans as well as for the remainder of the portfolio based on historical data, including past charge-offs and current economic trends.

Noninterest income for the quarter ended June 30, 2019, was $1.3 million, an increase of $145 thousand, or 12%, compared to the same quarter in 2018. Service charges on deposit accounts increased $13 thousand, or 4%, compared to the same quarter in 2018 primarily from a volume increase in overdraft fees. The gain on the sale of mortgage loans to the secondary market increased to $76 thousand for the quarter ended June 30, 2019 as additional loan volume was sold into the secondary market. Debit card interchange income increased $46 thousand, or 14%, with greater fees generated from usage in the second quarter of 2019. Fees from trust and brokerage services decreased $5 thousand to $212 thousand for the second quarter 2019 as compared to the same quarter in 2018. Earnings on bank owned life insurance increased $37 thousand for the second quarter 2019, see discussion in Results of Operations for the six months periods.

Noninterest expenses for the quarter ended June 30, 2019 increased $281 thousand, or 6%, compared to the second quarter of 2018. Salaries and employee benefits increased $197 thousand, or 7%, a result of increases in employees, base salary, and other benefits. Marketing and public relations expense increased

$20 thousand, or 17%, primarily due to brand recognition initiatives and the opening of a new banking center. Debit card expenses increased $6 thousand, or 5%, compared to the second quarter 2018 with increased volume. Software expense rose $11 thousand quarter over quarter with additional investment. Occupancy expense decreased $9 thousand in 2019 over the second quarter of 2018. Professional and director fees increased $69 thousand for the quarter ended June 30, 2019 as compared to the second quarter 2018. The increase was primarily a result of increased service costs related to network improvements.

Federal income tax expense increased $60 thousand, or 11%, for the quarter ended June 30, 2019 as compared to the second quarter of 2018. The provision for income taxes was $613 thousand (effective rate of 19%) for the quarter ended June 30, 2019, compared to $553 thousand (effective rate of 19%) for the same quarter ended 2018.

### RESULTS OF OPERATIONS

### Six months ended June 30, 2019 and 2018

For the six months ended June 30, 2019 and 2018, the Company recorded net income of $5.1 million and $4.5 million and $1.87 and $1.64 per share, respectively. The $638 thousand increase in net income for the quarter was primarily the result of a $1 million increase in net interest income, an increase of $224 thousand in other noninterest income, and a decrease in the provision for loan losses of $78 thousand. The increases were partially offset by an increase of $535 thousand in other noninterest expenses and an increase in the federal income tax provision of $170 thousand.

Return on average assets and return on average equity were 1.40% and 13.05%, respectively, for the six month period of 2019, compared to 1.28% and 12.64%, respectively for the same quarter in 2018.

### Average Balance Sheets and Net Interest Margin Analysis

*(Dollars in thousands)*

| ASSETS | For the six months ended June 30, 2019 Average balance | Average rate | 2018 Average balance | Average rate |
| --- | ---: | ---: | ---: | ---: |
| Federal funds sold | $305 | 2.38% | $508 | 1.98% |
| Interest-earning deposits in other banks | 33,144 | 2.37 | 14,294 | 1.75 |
| Taxable securities | 87,502 | 2.70 | 94,449 | 2.56 |
| Tax-exempt securities | 23,228 | 2.95 | 27,419 | 2.90 |
| Loans | 549,225 | 5.24 | 531,107 | 4.81 |
| Total earning assets | 693,404 | 4.70% | 667,777 | 4.34% |
| Other assets | 44,598 |  | 40,421 |  |
| **TOTAL ASSETS** | $738,002 |  | $708,198 |  |
| **LIABILITIES AND SHAREHOLDERS’ EQUITY** |  |  |  |  |
| Interest-bearing demand deposits | $123,050 | 0.42% | $117,475 | 0.26% |
| Savings deposits | 187,211 | 0.55 | 180,413 | 0.30 |
| Time deposits | 121,495 | 1.62 | 114,617 | 1.05 |
| Other borrowed funds | 45,101 | 1.17 | 52,708 | 0.91 |
| Total interest bearing liabilities | 476,857 | 0.85% | 465,213 | 0.54% |
| Non-interest bearing demand deposits | 178,980 |  | 169,071 |  |
| Other liabilities | 2,971 |  | 2,306 |  |
| Shareholders’ Equity | 79,194 |  | 71,608 |  |
| **TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY** | $738,002 |  | $708,198 |  |
| Taxable equivalent net interest spread |  | 3.85% |  | 3.80% |
| Taxable equivalent net interest margin |  | 4.12% |  | 3.97% |

Interest income for the six months ended June 30, 2019, was $16 million representing a $1.8 million increase, or a 13% improvement, compared to the same period in 2018. This increase was primarily due to the increase in average loan rates, as well as loan volume increasing $18 million for the period ended June 30, 2019 as compared to the same period in 2018. Interest expense for the six months ended June 30, 2019 was $2.0 million, an increase of $755 thousand, or 60%, from the same period in 2018. The increase in interest expense occurred primarily due to an increase in rate on all interest-bearing liabilities for the six month period ended June 30, 2019.

For the six month period ended June 30, 2019, the provision for loan losses was $570 thousand, compared to a provision of $648 thousand provision for the same period in 2018. For more discussion see Financial Condition. The provision for loan losses is determined based on management’s calculation of the adequacy of the allowance for loan losses, which includes provisions for classified loans as well as for the remainder of the portfolio based on historical data, including past charge-offs and current economic trends.

Noninterest income for the six month period ended June 30, 2019, was $2.5 million, an increase of $224 thousand, or 10%, compared to the same period in 2018. Service charges on deposit accounts increased $21 thousand, or 4%, compared to the same period in 2018 primarily from increases in overdraft fees. Debit card interchange income increased $80 thousand, or 13%, with increased card usage in the first six months of 2019. The cash surrender value of bank owned life insurance policies increased $39 thousand for the period with the additional purchase of $3 million in policies in 2019.The gain on the sale of mortgage loans to the secondary market increased $18 thousand to $155 thousand for the six month period ended June 30, 2019. Fees from trust and brokerage services were flat for the period.

Noninterest expenses for the six month period ended June 30, 2019 increased $535 thousand, or 6%, compared to the same period in 2018. Salaries and employee benefits increased $402 thousand, or 8%, a result of increases in employees, base salary, and other benefits. Marketing and public relations expense increased $17 thousand, or 7%, with increases in market, brand recognition initiatives, and community support in the company’s market. Debit card expenses increased $17 thousand, or 7%, compared to the prior period in 2018. Occupancy expense declined $25 thousand over the same period in 2018 with a decrease in depreciation and rental expense. Professional and director fees increased $96 thousand for the six month period ended June 30, 2019 as compared to the same period in 2018 with increases in service fees to improve the network.

Federal income tax expense increased $170 thousand, or 16%, for the six months ended June 30, 2019 as compared to the same period in 2018. The provision for income taxes was $1.2 million (effective rate of 19%) for the six month period ended June 30, 2019, compared to $1.1 million (effective rate of 19%) for the same period ended 2018.

### CAPITAL RESOURCES

The Company maintained a strong capital position with tangible common equity to tangible assets of 10.3% at June 30, 2019 compared with 9.9% at December 31, 2018.

Effective January 1, 2015 the Federal Reserve adopted final rules implementing Basel III and regulatory capital changes required by the Dodd-Frank Act. The rules apply to both the Company and the Bank. The rules established minimum risk-based and leverage capital requirements for all banking organizations. Effective with the March 31, 2015 Call Report the Bank selected the opt-out election for accumulated other comprehensive income (“AOCI”). This election neutralizes the effects of unrealized gains and losses from available-for-sale securities and other elements of the AOCI account for regulatory capital purposes.

Consistent with the Board of Director’s commitment to public confidence and safe and sound banking operations, capital targets and minimum risk-based capital ratios for CSB were established to maintain excess capital to well-capitalized standards. To be considered well-capitalized, an institution must have a total risk-based capital ratio of at least 10%, a tier 1 capital ratio of at least 8%, a leverage capital ratio of at least 5%, a CET1 ratio of at least 6.5%, and must not be subject to any order or directive requiring the institution to improve its capital level. An adequately capitalized institution has a total risk-based capital ratio of at least 8%, a tier 1 capital ratio of at least 6%, a CET1 ratio of at least 4.5%, and a leverage ratio of at least 4%.

Failure to meet specified minimum capital requirements could result in regulatory actions by the Federal Reserve or Ohio Division of Financial Institutions that could have a material effect on the Company’s financial condition or results of operations. Management believes there were no material changes to capital resources as presented in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. As of June 30, 2019 the Company and the Bank met all capital adequacy requirements to which they were subject.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

| Common Equity Tier 1 Capital To Risk Weighted Assets | Capital Ratios June 30, 2019 | December 31, 2018 |
| --- | ---: | ---: |
| Consolidated | 14.0% | 13.4% |
| Bank | 13.8% | 13.2% |
| Tier 1 Capital To Risk Weighted Assets Ratio |  |  |
| Consolidated | 14.0% | 13.4% |
| Bank | 13.8% | 13.2% |
| Total Capital To Risk Weighted Assets Ratio |  |  |
| Consolidated | 15.2% | 14.5% |
| Bank | 15.0% | 14.3% |
| Tier 1 Leverage Ratio |  |  |
| Consolidated | 10.4% | 10.1% |
| Bank | 10.2% | 9.9% |

### LIQUIDITY

*(Dollars in millions)*

|  | June 30, 2019 | December 31, 2018 | Change |
| --- | ---: | ---: | ---: |
| Cash and cash equivalents | $57 | $46 | $11 |
| Unused lines of credit | 97 | 89 | 8 |
| Unpledged AFS securities at fair market value | 41 | 39 | 2 |
|  | $195 | $174 | $21 |
| Net deposits and short-term liabilities | $614 | $599 | $15 |
| Liquidity ratio | 31.8% | 29.1% | 2.7 |
| Minimum board approved liquidity ratio | 20.0% | 20.0% | — |

Liquidity refers to the Company’s ability to generate sufficient cash to fund current loan demand, meet deposit withdrawals, pay operating expenses, and meet other obligations. Liquidity is monitored by the Company’s Asset Liability Committee. Other sources of liquidity include, but are not limited to, purchases of federal funds, advances from the FHLB, adjustments of interest rates to attract deposits, brokered deposits, and borrowing at the Federal Reserve discount window. Management believes that its sources of liquidity are adequate to meet cash flow obligations for the foreseeable future.

The liquidity ratio was 31.8% and 29.1% at June 30, 2019 and December 31, 2018.

### OFF-BALANCE SHEET ARRANGEMENTS

The Company does not have any off-balance sheet arrangements (as such term is defined in applicable Securities and Exchange Commission (the “Commission”) rules) that are reasonably likely to have a current or future material effect on our financial condition, results of operations, liquidity, capital expenditures, or capital resources.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

## Market risk

As filed, 1,984 characters.

There have been no material changes in the quantitative and qualitative disclosures about market risks as of June 30, 2019, from the disclosures presented in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018.

Management performs a quarterly analysis of the Company’s interest rate risk over a twenty-four month horizon. The analysis includes two balance sheet models, one based on a static balance sheet and one on a dynamic balance sheet with projected growth in assets and liabilities. All balance sheet positions and interest rate projections are currently within the Company’s board-approved policy.

The following table presents an analysis of the estimated sensitivity of the Company’s annual net interest income to sudden and sustained -200 through +400 basis point changes, in 100 basis point increments, in market interest rates at June 30, 2019 and -200 through +400 basis point changes at December 31, 2018. The net interest income reflected is for the first twelve month period of the modeled twenty-four month horizon. The underlying balance sheet for illustrative purposes is dynamic with projected growth in assets and liabilities.

*June 30, 2019*

*(Dollars in thousands)*

| Change in Interest Rates (basis points) | Net Interest Income | Dollar Change | Percentage Change | Board Policy Limits |
| --- | ---: | ---: | ---: | --- |
| +400 | $29,780 | $893 | 3.1% | +/-25% |
| +300 | 29,597 | 710 | 2.5 | +/-15 |
| +200 | 29,388 | 501 | 1.7 | +/-10 |
| +100 | 29,118 | 231 | 0.8 | +/-5 |
| 0 | 28,887 | — | — | — |
| -100 | 28,557 | (330) | (1.1) | +/-5 |
| -200 | 27,950 | (937) | (3.3) | +/-10 |
| **December 31, 2018** |  |  |  |  |
| +400 | $30,114 | $931 | 3.2% | +/-25% |
| +300 | 29,922 | 739 | 2.5 | +/-15 |
| +200 | 29,701 | 518 | 1.8 | +/-10 |
| +100 | 29,436 | 253 | 0.9 | +/-5 |
| 0 | 29,183 | — | — | — |
| -100 | 28,831 | (352) | (1.2) | +/-5 |
| -200 | 27,880 | (1,303) | (4.5) | +/-10 |

34

CONTROLS AND PROCEDURES

## Controls and procedures

As filed, 5,244 characters.

With the participation of the Company’s management, including its Chief Executive Officer and Chief Financial Officer, the Company has evaluated the effectiveness of its disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based upon that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that:

(a) information required to be disclosed by the Company in this Quarterly Report on Form 10-Q would be accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure;

(b) information required to be disclosed by the Company in this Quarterly Report on Form 10-Q would be recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms; and

(c) the Company’s disclosure controls and procedures are effective as of the end of the period covered by this Quarterly Report on Form 10-Q to ensure that material information relating to the Company and its consolidated subsidiary is made known to them, particularly during the period for which the Company’s periodic reports, including this Quarterly Report on Form 10-Q, are being prepared.

### CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There were no changes during the period covered by this Quarterly Report on Form 10-Q in the Company’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

FORM 10-Q

Quarter ended June 30, 2019

PART II – OTHER INFORMATION

| ITEM 1- | LEGAL PROCEEDINGS. |
| --- | --- |
|  | In the opinion of management there are no outstanding legal proceedings that are reasonably likely to have a material adverse effect on the company’s financial condition or results of operations. |
| **ITEM 1A-** | **RISK FACTORS.** |
|  | There have been no material changes to the Company’s risk factors from those disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018. |
| **ITEM 2-** | **UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.** |
|  | On July 7, 2005 CSB Bancorp, Inc. filed Form 8-K with the Commission announcing that its Board of Directors approved a Stock Repurchase Program authorizing the repurchase of up to 10% of the Company’s common shares then outstanding. Repurchases may be made from time to time as market and business conditions warrant, in the open market, through block purchases, and in negotiated private transactions. No repurchases were made during the quarterly period ended June 30, 2019. |
| **ITEM 3-** | **DEFAULTS UPON SENIOR SECURITIES.** |
|  | Not applicable. |
| **ITEM 4-** | **MINE SAFETY DISCLOSURES.** |
|  | Not applicable. |
| **ITEM 5-** | **OTHER INFORMATION.** |
|  | Not applicable. |

36

FORM 10-Q

Quarter ended June 30, 2019

PART II – OTHER INFORMATION

| ITEM 6- | Exhibits. |
| ---: | --- |
| **Exhibit Number** | **Description of Document** |
| 3.1 | Amended Articles of Incorporation of CSB Bancorp, Inc. (incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q filed August 6, 2004, Exhibit 3.1, film number 04958544). |
| 3.2 | Code of Regulations of CSB Bancorp, Inc. (incorporated by reference to the Registrant’s Form 10-SB). |
| 3.2.1 | Amended Article VIII of the Code of Regulations of CSB Bancorp, Inc. (incorporated by reference to Registrant’s Form DEF 14a filed on March 25, 2009, Appendix A, film number 09703970). |
| 4.0 | Specimen stock certificate (incorporated by reference to Registrant’s Form 10-SB). (P). |
| 11 | Statement Regarding Computation of Per Share Earnings. |
| 31.1 | Rule 13a-14(a)/15d-14(a) Chief Executive Officer’s Certification. |
| 31.2 | Rule 13a-14(a)/15d-14(a) Chief Financial Officer’s Certification. |
| 32.1 | Section 1350 Chief Executive Officer’s Certification. |
| 32.2 | Section 1350 Chief Financial Officer’s Certification. |
| 101 | The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 formatted in XBRL (extensible Business Reporting Language): (i) Consolidated Balance Sheets: (ii) Consolidated Statements of Income: (iii) Consolidated Statements of Comprehensive Income: (iv) Consolidated Statements of Changes in Shareholders’ Equity: (v) Condensed Consolidated Statements of Cash Flows: and (vi) Notes to Consolidated Financial Statements. |

37

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

|  |  |
| --- | --- |
|  | CSB BANCORP, INC. |
|  | (Registrant) |
| Date: August 8, 2019 | /s/ Eddie L. Steiner |
|  | Eddie L. Steiner |
|  | President |
|  | Chief Executive Officer |
| Date: August 8, 2019 | /s/ Paula J. Meiler |
|  | Paula J. Meiler |
|  | Senior Vice President |
|  | Chief Financial Officer |

38

Filed Aug 8, 2019.
Source: SEC EDGAR, the filing index for accession 0001193125-19-216697. Last ingested by Listed: Nov 2, 2026, 09:27 ET. No prices; not investment advice.