##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended: March 31, 2009
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission file number: 0-21714
 CSB Bancorp, Inc.
 (Exact name of registrant as specified in its charter)
 Ohio
    
    34-1687530(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer Identification Number)
 91 North Clay, P.O. Box 232, Millersburg, Ohio 44654
   (Registrants telephone number)
  þ o
  o o
  Large accelerated filer o
Accelerated filer o
Non-accelerated filer o(Do not check if a smaller reporting company)
Smaller reporting company þ  o þ
  Common stock, $6.25 par value
    
    Outstanding at May 14, 2009:2,734,799 common shares




---



##### 



PageITEM 1 - FINANCIAL STATEMENTS (Unaudited)Consolidated Balance Sheets
    
    
    3Consolidated Statements of Income
    
    
    4Consolidated Statements of Changes in Shareholders Equity
    
    
    5Condensed Consolidated Statements of Cash Flows
    
    
    6Notes to the Consolidated Financial Statements
    
    
    7ITEM 2  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    
    
    12ITEM 3  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    16ITEM 4T  CONTROLS AND PROCEDURES
    
    
    17Part II  Other InformationITEM 1   Legal Proceedings
    
    
    181A  Risk Factors
    
    
    182     Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    183     Defaults upon Senior Securities
    
    
    184     Submission of Matters to a Vote of Security Holders
    
    
    185     Other Information
    
    
    186     Exhibits
    
    
    19Signatures
    
    
    20EX-11EX-31.1EX-31.2EX-32.1EX-32.2




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March 31,
    
    
    December 31,2009
    
    
    2008ASSETSCash and due from bank
    
    $
    7,479,007
    
    
    $
    8,698,917Interest-earning deposits in other banks
    
    
    12,072,028
    
    
    
    2,961,153Federal funds sold
    
    
    
    
    
    
    1,086,000Total cash and cash equivalents
    
    
    19,551,035
    
    
    
    12,746,070Securities available-for-sale, at fair value
    
    
    65,282,581
    
    
    
    76,655,816Restricted stock, at cost
    
    
    5,231,800
    
    
    
    5,231,800Total securities
    
    
    70,514,381
    
    
    
    81,887,616Loans
    
    
    319,424,751
    
    
    
    316,290,412Less allowance for loan losses
    
    
    3,401,888
    
    
    
    3,393,685Net loans
    
    
    316,022,863
    
    
    
    312,896,727Premises and equipment, net
    
    
    8,368,805
    
    
    
    8,470,855Bank owned life insurance
    
    
    2,774,893
    
    
    
    2,748,909Other intangible assets
    
    
    570,923
    
    
    
    597,014Goodwill
    
    
    1,448,029
    
    
    
    1,448,029Accrued interest receivable and other assets
    
    
    3,139,114
    
    
    
    3,861,962Total Assets
    
    $
    422,390,043
    
    
    $
    424,657,182LIABILITIESDepositsNoninterest-bearing
    
    $
    42,685,916
    
    
    $
    49,058,592Interest-bearing
    
    
    261,904,865
    
    
    
    256,394,147Total deposits
    
    
    304,590,781
    
    
    
    305,452,739Short-term borrowings
    
    
    20,416,999
    
    
    
    22,891,593Other borrowings
    
    
    50,590,025
    
    
    
    50,997,537Accrued interest payable and other liabilities
    
    
    2,400,564
    
    
    
    1,846,841Total liabilities
    
    
    377,998,369
    
    
    
    381,188,710SHAREHOLDERS EQUITYCommon stock, $6.25 par value: Authorized 9,000,000
shares; issued 2,980,602 shares
    
    
    18,628,767
    
    
    
    18,628,767Additional paid-in capital
    
    
    9,987,999
    
    
    
    9,986,499Retained earnings
    
    
    20,127,651
    
    
    
    19,723,972Treasury stock at cost: 245,803 shares
    
    
    (5,014,541
    )
    
    
    (5,014,541
    )Accumulated other comprehensive income
    
    
    661,798
    
    
    
    143,775Total shareholders equity
    
    
    44,391,674
    
    
    
    43,468,472Total Liabilities and Shareholders Equity
    
    $
    422,390,043
    
    
    $
    424,657,182
  3.




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Three Months EndedMarch 31,2009
    
    
    2008Interest incomeLoans, including fees
    
    $
    4,620,756
    
    
    $
    4,412,704Taxable securities
    
    
    887,867
    
    
    
    804,622Nontaxable securities
    
    
    67,997
    
    
    
    43,878Other
    
    
    2,724
    
    
    
    22,207Total interest income
    
    
    5,579,344
    
    
    
    5,283,411Interest expenseDeposits
    
    
    1,162,395
    
    
    
    1,427,758Other
    
    
    523,389
    
    
    
    475,888Total interest expense
    
    
    1,685,784
    
    
    
    1,903,646Net interest income
    
    
    3,893,560
    
    
    
    3,379,765Provision for loan losses
    
    
    241,072
    
    
    
    107,032Net interest income after provision
for loan losses
    
    
    3,652,488
    
    
    
    3,272,733Non-interest incomeService charges on deposit accounts
    
    
    293,301
    
    
    
    287,152Trust and financial services
    
    
    114,759
    
    
    
    188,664Debit card interchange fees
    
    
    85,064
    
    
    
    70,821Credit card fee income
    
    
    15,814
    
    
    
    64,052Gain on sale of loans
    
    
    67,569
    
    
    
    264,659Security gains
    
    
    116,080
    
    
    
    Other income
    
    
    103,568
    
    
    
    80,138Total non-interest income
    
    
    796,155
    
    
    
    955,486Non-interest expensesSalaries and employee benefits
    
    
    1,708,364
    
    
    
    1,536,903Occupancy expense
    
    
    243,345
    
    
    
    197,881Equipment expense
    
    
    133,745
    
    
    
    125,450State franchise tax
    
    
    109,790
    
    
    
    107,430Professional and director fees
    
    
    143,763
    
    
    
    139,556Amortization of intangible assets
    
    
    16,318
    
    
    
    Other expenses
    
    
    773,575
    
    
    
    621,239Total non-interest expenses
    
    
    3,128,900
    
    
    
    2,728,459Income before income taxes
    
    
    1,319,743
    
    
    
    1,499,760Federal income tax provision
    
    
    423,800
    
    
    
    498,000Net income
    
    $
    895,943
    
    
    $
    1,001,760Basic and diluted earnings per share
    
    $
    0.33
    
    
    $
    0.41
  4.




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Three Months EndedMarch 31,2009
    
    
    2008Balance at beginning of period
    
    $
    43,468,472
    
    
    $
    36,278,048Comprehensive income:Net income
    
    
    895,943
    
    
    
    1,001,760Change in net unrealized
gain, net of reclassification
adjustments and related
income taxes of $266,860
and $214,879, respectively
    
    
    518,023
    
    
    
    417,119Total comprehensive income
    
    
    1,413,966
    
    
    
    1,418,879Stock-based compensation expense
    
    
    1,500
    
    
    
    3,500Purchase of treasury shares
    
    
    
    
    
    
    (113,453
    )Cash dividends declared
($0.18 per share in
2009 and 2008)
    
    
    (492,264
    )
    
    
    (439,353
    )Balance at end of period
    
    $
    44,391,674
    
    
    $
    37,147,621
  5.




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Three Months EndedMarch 31,2009
    
    
    2008Net cash from operating activities
    
    $
    1,532,528
    
    
    $
    1,216,242Cash flows from investing activitiesSecurities available-for-sale:Proceeds from maturities, calls and repayments
    
    
    11,307,090
    
    
    
    22,403,914Purchases
    
    
    (336,614
    )
    
    
    (13,611,007
    )Purchase of FHLB stock
    
    
    
    
    
    
    (37,000
    )Proceeds from sale of securities
    
    
    1,291,968
    
    
    
    Proceeds from sale of other real estate
    
    
    25,000
    
    
    
    105,000Loan originations, net of repayments
    
    
    (3,379,052
    )
    
    
    (7,446,531
    )Proceeds from sale of credit cards
    
    
    
    
    
    
    2,513,671Premises and equipment expenditures, net
    
    
    (66,310
    )
    
    
    (125,547
    )Net cash provided by investing activities
    
    
    8,842,082
    
    
    
    18,695,562Cash flows from financing activitiesNet change in deposits
    
    
    (790,789
    )
    
    
    (12,356,630
    )Net change in short-term borrowings
    
    
    (2,474,594
    )
    
    
    (2,700,996
    )Proceeds from other borrowings
    
    
    
    
    
    
    8,000,000Repayment of other borrowings
    
    
    (304,262
    )
    
    
    (148,375
    )Purchase of treasury shares
    
    
    
    
    
    
    (113,453
    )Net cash used for financing activities
    
    
    (3,569,645
    )
    
    
    (7,319,454
    )Net change in cash and cash equivalents
    
    
    6,804,965
    
    
    
    12,592,350Cash and cash equivalents at beginning of period
    
    
    12,746,070
    
    
    
    12,193,362Cash and cash equivalents at end of period
    
    $
    19,551,035
    
    
    $
    24,785,712Supplemental disclosuresInterest paid
    
    $
    1,878,818
    
    
    $
    1,918,857Income taxes paid
    
    
    50,000
    
    
    
    
  6.




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NOTE 1  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
    RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
 Determining Fair Value When the Volume and Level
of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions
That Are Not Orderly
 Interim Disclosures about Fair Value
of Financial Instruments
 Recognition and Presentation of
Other-Than-Temporary Impairments
 7.




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Determination of the Useful Life of Intangible Assets , Goodwill and Other Intangible Assets
 8.




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NOTE 2  SECURITIES
  March 31, 2009
 Amortized
    
    
    Gross 
unrealized
    
    
    Gross 
unrealized
    
    
    FairCost
    
    
    gains
    
    
    losses
    
    
    ValueAvailable-for-sale:U.S. Treasury security
    
    $
    101,332
    
    
    $
    
    
    
    $
    66
    
    
    $
    101,266Obligations of U.S.
government
corporations and agencies
    
    
    3,896,157
    
    
    
    24,062
    
    
    
    
    
    
    
    3,920,219Mortgage-backed securities
    
    
    52,890,581
    
    
    
    1,316,556
    
    
    
    287,328
    
    
    
    53,919,809Obligations of states and
political subdivisions
    
    
    7,279,329
    
    
    
    58,408
    
    
    
    64,950
    
    
    
    7,272,787Total debt securities
    
    
    64,167,399
    
    
    
    1,399,026
    
    
    
    352,344
    
    
    
    65,214,081Equity Securities
    
    
    112,457
    
    
    
    285
    
    
    
    44,242
    
    
    
    68,500Total available-for-sale
    
    
    64,279,856
    
    
    
    1,399,311
    
    
    
    396,586
    
    
    
    65,282,581Restricted stock
    
    
    5,231,800
    
    
    
    
    
    
    
    
    
    
    
    5,231,800Total securities
    
    $
    69,511,656
    
    
    $
    1,399,311
    
    
    $
    396,586
    
    
    $
    70,514,381
 December 31, 2008
 Amortized
    
    
    Gross 
unrealized
    
    
    Gross 
unrealized
    
    
    FairCost
    
    
    gains
    
    
    losses
    
    
    ValueAvailable-for-sale:U.S. Treasury security
    
    $
    99,988
    
    
    $
    473
    
    
    $
    
    
    
    $
    100,461Obligations of U.S.
government
corporations and agencies
    
    
    12,447,301
    
    
    
    93,055
    
    
    
    
    
    
    
    12,540,356Mortgage-backed securities
    
    
    56,697,763
    
    
    
    618,677
    
    
    
    417,495
    
    
    
    56,898,945Obligations of states and
political subdivisions
    
    
    7,045,468
    
    
    
    77,901
    
    
    
    83,073
    
    
    
    7,040,296Total debt securities
    
    
    76,290,520
    
    
    
    790,106
    
    
    
    500,568
    
    
    
    76,580,058Equity Securities
    
    
    147,458
    
    
    
    645
    
    
    
    72,345
    
    
    
    75,758Total available-for-sale
    
    
    76,437,978
    
    
    
    790,751
    
    
    
    572,913
    
    
    
    76,655,816Restricted stock
    
    
    5,231,800
    
    
    
    
    
    
    
    
    
    
    
    5,231,800Total securities
    
    $
    81,669,778
    
    
    $
    790,751
    
    
    $
    572,913
    
    
    $
    81,887,616
 9.




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NOTE 3  FAIR VALUE MEASUREMENTS (FAS NO. 157)
  Level I:
    
    Quoted prices are available in active markets for identical
assets or liabilities as of the reported date.Level II:
    
    Pricing inputs are other than quoted prices in active markets,
which are either directly or indirectly observable as of the
reported date. The nature of these assets and liabilities
include items for which quoted prices are available but traded
less frequently, and items that are fair valued using other
financial instruments, the parameters of which can be directly
observed.Level III:
    
    Assets and liabilities that have little to no pricing
observability as of the reported date. These items do not have
two-way markets and are measured using managements best
estimate of fair value, where the inputs into the determination
of fair value require significant management judgment or
estimation.
  Level I
    
    Level II
    
    Level III
    
    TotalAssets:March 31, 2009Securities available for sale
    
    $
    169,766
    
    
    $
    65,112,815
    
    
    $
    
    
    
    $
    65,282,581December 31, 2008Securities available for sale
    
    $
    176,219
    
    
    $
    76,479,597
    
    
    $
    
    
    
    $
    76,655,816
  10.




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Level I
    
    Level II
    
    Level III
    
    TotalAssets Measured on a Nonrecurring Basis:March 31, 2009Impaired loans
    
    $
    
    
    
    $
    1,822,471
    
    
    $
    
    
    
    $
    1,822,471December 31, 2008Impaired loans
    
    $
    
    
    
    $
    2,049,171
    
    
    $
    
    
    
    $

    2,049,171
 NOTE 4  BUSINESS COMBINATION
   For the three months 
ended March 31,(in thousands, except per share amounts)
    
    2009
    
    2008Net interest income
    
    $
    3,894
    
    
    $
    4,020Provision for loan losses
    
    
    241
    
    
    
    205Non-interest income
    
    
    796
    
    
    
    1,044Non-interest expense
    
    
    3,129
    
    
    
    3,333Net income
    
    
    896
    
    
    
    1,164Net income per common shareBasic
    
    $
    0.33
    
    
    $
    0.42Diluted
    
    $
    0.33
    
    
    $
    0.42
 11.




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ITEM 2  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
  FORWARD-LOOKING STATEMENTS
   FINANCIAL CONDITION
   12.




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(dollars in thousands)
    
    March 31, 2009
    
    December 31, 2008
    
    March 31, 2008Non-performing loans
    
    $
    4,123,091
    
    
    $
    2,642,728
    
    
    $
    431,000Other real estate
    
    
    59,000
    
    
    
    79,000
    
    
    
    0Allowance for loan losses
    
    
    3,401,888
    
    
    
    3,393,685
    
    
    
    2,690,830Total loans
    
    
    319,424,751
    
    
    
    316,290,412
    
    
    
    246,983,893Allowance: loans
    
    
    1.07
    %
    
    
    1.07
    %
    
    
    1.09
    %Allowance: non-performing
loans
    
    
    .8
    x
    
    
    1.3
    x
    
    
    6.2
    x
     13.




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##### Table of Contents



RESULTS OF OPERATIONS
 Three months ended March 31, 2009 and 2008
     14.




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CAPITAL RESOURCES
  LIQUIDITY
  OFF-BALANCE SHEET ARRANGEMENTS
  15.




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##### Table of Contents



ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
   March 31, 2009
 Changes inInterest Rates
    
    Net Interest
    
    Dollar
    
    Percentage(basis points)
    
    Income
    
    Change
    
    Change(Dollars in Thousands)+200
    
    
    16,063
    
    
    $
    674
    
    
    
    4.4
    %+100
    
    
    15,777
    
    
    
    388
    
    
    
    2.50
    
    
    15,389
    
    
    
    0
    
    
    
    0.0-100
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A-200
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
 December 31, 2008
 Changes inInterest Rates
    
    Net Interest
    
    Dollar
    
    Percentage(basis points)
    
    Income
    
    Change
    
    Change(Dollars in Thousands)+200
    
    $
    16,084
    
    
    $
    651
    
    
    
    4.2
    %+100
    
    
    15,786
    
    
    
    353
    
    
    
    2.30
    
    
    15,433
    
    
    
    0
    
    
    
    0.0-100
    
    
    15,532
    
    
    
    99
    
    
    
    0.6-200
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
 16.




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##### Table of Contents



ITEM 4T  CONTROLS AND PROCEDURES
     CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
  17.




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ITEM 1 
    
    LEGAL PROCEEDINGSThere are no matters required to be reported under this item.ITEM 2 
    
    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDSThere are no matters required to be reported under this item.
 Issuer Purchase of Equity Securities
 Total Number of
    
    Maximum Number of SharesTotal Number
    
    Average
    
    Shares Purchased
    
    that May Yet beof Shares
    
    Price Paid
    
    as Part of Publicly
    
    Purchased UnderPeriod
    
    Purchased
    
    Per Share
    
    Announced Plans
    
    the PlanJanuary 1, 2009 to
January 31, 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    41,471February 1, 2009 to
February 28, 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    41,471March 1, 2009 to
March 31, 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    41,471
 On July 7, 2005 CSB Bancorp, Inc. filed Form 8-k with the Securities and Exchange
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 will be made from time to time as market and business conditions warrant, in
the open market, through block purchases and in negotiated private transactions.ITEM 3 
    
    Defaults Upon Senior Securities:There are no matters required to be reported under this item.ITEM 4 
    
    Submission of Matters to a Vote of Security Holders:There are no matters required to be reported under this itemITEM 5 
    
    Other Information:There are no matters required to be reported under this item
 18.




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##### Table of Contents



ITEM 6 
    
    Exhibits:
 ExhibitNumber
    
    Description of Document3.1
    
    Amended Articles of Incorporation of CSB Bancorp, Inc.
(incorporated by reference to Registrants Form 10-KSB for the Fiscal Year
ended December 31, 1994)3.1.1
    
    Amended form of Article Fourth of Amended Articles of
Incorporation, as effective April 9, 1998 (incorporated by reference to
Registrants Form 10-K for the Fiscal Year ended December 31, 1998)3.2
    
    Code of Regulations of CSB Bancorp, Inc. (incorporated by
reference to Registrants Form 10-SB)4
    
    Specimen stock certificate (incorporated by reference to
Registrants Form 10-SB.11
    
    Statement Regarding Computation of Per Share Earnings (reference
is hereby made to Consolidated Statements of Income on page 4 hereof.)31.1
    
    Rule 13a-14(a)/15d-14(a) CEOs Certification31.2
    
    Rule 13a-14(a)/15d-14(a) CFOs Certification32.1
    
    Section 1350 CEOs Certification32.2
    
    Section 1350 CFOs Certification
 19.




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##### Table of Contents



CSB
BANCORP, INC.
(Registrant)Date: May 14, 2009
    /s/ Eddie L. SteinerEddie L. SteinerPresident
Chief Executive OfficerDate: May 14, 2009
    /s/ Paula J. MeilerPaula J. MeilerSenior Vice President
Chief Financial Officer 20.




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##### Table of Contents



ExhibitNumber
    
    Description of Document3.1
    
    Amended Articles of Incorporation of CSB Bancorp, Inc.
(incorporated by reference to Registrants Form 10-KSB
for the Fiscal Year ended December 31, 1994)3.1.1
    
    Amended form of Article Fourth of Amended
Articles of Incorporation, as effective April 9, 1998
(incorporated by reference to Registrants Form 10-k for the
Fiscal Year ended December 31, 1998)3.2
    
    Code of Regulations of CSB Bancorp, Inc.
(incorporated by reference to Registrants Form 10-SB)4
    
    Specimen stock certificate
(incorporated by reference to Registrants Form 10-SB)11
    
    Statement Regarding Computation of Per Share
Earnings (reference is hereby made to Consolidated Statements of
Income on page 4 hereof.)31.1
    
    Rule 13a-14(a)/15d-14(a) CEOs Certification31.2
    
    Rule 13a-14(a)/15d-14(a) CFOs Certification32.1
    
    Section 1350 CEOs Certification32.2
    
    Section 1350 CFOs Certification
 21.