8-K
LCNB CORP (LCNB)
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 20, 2020
LCNB CORP.
(Exact name of Registrant as specified in its Charter)
| Ohio | 001-35292 | 31-1626393 |
|---|---|---|
| (State or other jurisdiction of incorporation) | (Commission File No.) | (IRS Employer Identification Number) |
2 North Broadway, Lebanon, Ohio 45036
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (513) 932-1414
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities Registered Pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, No Par Value | LCNB | NASDAQ |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On October 20, 2020, LCNB Corp. issued an earnings release announcing its financial results for the three and nine months ended September 30, 2020. A copy of the earnings release (Exhibit 99.1) and unaudited financial highlights (Exhibit 99.2) are attached and are furnished under this Item 2.02.
Item 7.01 Regulation FD Disclosure.
On October 20, 2020, LCNB Corp. issued an earnings release announcing its financial results for the three and nine months ended September 30, 2020. A copy of the earnings release (Exhibit 99.1) and unaudited financial highlights (Exhibit 99.2) are attached and are furnished under this Item 7.01.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
99.1 Earnings Press Release DatedOctober20, 2020
99.2 Unaudited Financial Highlights
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.
| LCNB CORP. | ||
|---|---|---|
| Date: October 20, 2020 | By: /s/ Robert C. Haines II | |
| Robert C. Haines II<br>Chief Financial Officer |
Document
Exhibit 99.1
Press Release
October 20, 2020
LCNB CORP. REPORTS FINANCIAL RESULTS FOR
THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2020
LEBANON, Ohio — LCNB Corp. ("LCNB") (NASDAQ: LCNB) today announced financial results for the three and nine months ended September 30, 2020.
Net income for the third quarter 2020 was $4,250,000, compared to $4,727,000 for the same period last year. Earnings per basic and diluted share for the third quarter 2020 were $0.33, compared to $0.36 for the same period last year. Net income for the nine-month period ended September 30, 2020 was $14,333,000, compared to $14,082,000 for the same period last year. Earnings per basic and diluted share for the nine-month period ended September 30, 2020 were $1.11 compared to $1.07 for the same period last year.
Earnings, before provisions for loan losses and income taxes, increased 3.4% to $6,154,000 for the third quarter 2020 compared to $5,952,000 for the same period last year. For the nine-month period ended September 30, 2020, earnings, before provisions for loan losses and income taxes, increased 12.4% to $19,300,000, compared to $17,170,000 for the nine-month period ended September 30, 2019.
Commenting on the financial results, LCNB President and Chief Executive Officer Eric Meilstrup said, “LCNB’s third quarter financial results demonstrate the resiliency of our business, employees, customers, and communities, as we navigate the unprecedented impacts of the COVID-19 pandemic. While our asset quality remains relatively stable, we prudently increased our allowance for loan and lease losses to account for uncertainty regarding the long-term economic impacts of the COVID-19 crisis. I am encouraged that our core earnings before provision and tax expenses increased 3.4% during the third quarter and are up 12.4% year-to-date, as we benefit from our diverse non-interest income generating businesses and improvements in our cost of funds. Third quarter non-interest income increased 27.5% over the prior year period, and now represents 21.8% of total revenues, compared to 17.0% of total revenues in the 2019 third quarter primarily due to strong residential mortgage demand and higher fiduciary income.”
Mr. Meilstrup continued, “We are working hard to support our local communities and I am encouraged by the growth we experienced in net loans and total deposits which increased 7.6% and 6.1%, respectively, since December 31, 2019. Since the COVID-19 pandemic began, we have also supported our communities by offering customers impacted by the COVID-19 crisis the ability to defer certain loan payments and over the past three months we have experienced a material decline in the amount of deferrals. Overall, I am pleased with the underlying performance of our loan portfolio as third quarter 2020 net charge-offs were only $18,000, compared to $209,000 for the same period last year.”
“As we enter the fourth quarter, we remain focused on providing our communities with personalized financial services and we have started assisting our Paycheck Protection Program loan customers through the Small Business Administration forgiveness process. I am extremely proud of the continued dedication and hard work of LCNB’s employees and the positive contributions they provide our customers and communities,” concluded Mr. Meilstrup.
Net interest income for the three months ended September 30, 2020 was $13,529,000, compared to $13,578,000 for the comparable period in 2019. The slight decline for the three-month period was primarily due to market driven decreases in the average rates earned on loans and investments, partially offset by growth in the average balance of the loan portfolio. Net interest income for the nine-month period ended September 30, 2020 increased $1,146,000 to $41,705,000, as compared to the nine month period ended September 30, 2019. The increase for the nine-month period was primarily due to growth in the average balance of LCNB's loan portfolio, partially offset by a decrease in the average rate earned on that portfolio. Favorably contributing to the variances for both the three and nine month periods were market driven decreases in the average rates paid on deposits.
The provision for loan losses for the three and nine months ended September 30, 2020 were, respectively, $712,000 and $1,952,000 greater than the comparable periods in 2019 partially due to adjustments for estimated impacts from the economic downturn caused by the COVID-19 pandemic. Non-accrual loans and loans past due 90 days or more and still accruing interest increased $994,000, from $3,210,000, or 0.26%, of total loans at December 31, 2019 to $4,204,000, or 0.31%, of total loans at September 30, 2020. The increase was primarily due to three loans that were newly classified during 2020.
Non-interest income for the three and nine months ended September 30, 2020 was, respectively, $922,000 and $2,310,000 greater than the comparable periods in 2019 primarily due to increases in fiduciary income and gains from sales of loans, partially offset by a decrease in service charges and fees on deposit accounts. The increase for the nine month period included gains from the sale of equity securities, which is recorded in other operating income in the consolidated condensed statements of income, gains from the sale of debt securities, and an increase in income from bank owned life insurance. Income from bank owned life insurance increased year-to-date partially due to new policies purchased in the third quarter 2019 and partially due to a mortality benefit received during the first quarter 2020.
Non-interest expense for the three and nine months ended September 30, 2020 was, respectively, $671,000 and $1,326,000 greater than the comparable periods in 2019, primarily due to increases in salaries and employee benefits and other non-interest expenses. Salaries and employee benefits increased primarily due to salary and wage increases and newly hired employees, including additional business development positions. An increase in health insurance costs also contributed to the increase in employee benefits. Partially offsetting the increase for the nine month period was a decrease in FDIC insurance premiums due to a small bank assessment credit received during both the first and second quarters 2020. LCNB used the credit in full during those two quarters and the premium payment returned to a normal level for the third quarter 2020.
LCNB Corp. is a financial holding company headquartered in Lebanon, Ohio. Through its subsidiary, LCNB National Bank (the “Bank”), it serves customers and communities in Southwest and South Central Ohio. A financial institution with a long tradition for building strong relationships with customers and communities, the Bank offers convenient banking locations in Butler, Clermont, Clinton, Fayette, Franklin, Hamilton, Montgomery, Preble, Ross, and Warren Counties, Ohio. The Bank continually strives to exceed customer expectations and provides an array of services for all personal and business banking needs including checking, savings, online banking, personal lending, business lending, agricultural lending, business support, deposit and treasury, investment services, trust and IRAs and stock purchases. LCNB Corp. common shares are traded on the NASDAQ Capital Market Exchange® under the symbol “LCNB.” Learn more about LCNB Corp. at www.lcnb.com.
Certain statements made in this news release regarding LCNB’s financial condition, results of operations, plans, objectives, future performance and business, are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements are identified by the fact they are not historical facts and include words such as “anticipate”, “could”, “may”, “feel”, “expect”, “believe”, “plan”, and similar expressions. Please refer to LCNB’s Annual Report on Form 10-K for the year ended December 31, 2019, as well as its other filings with the SEC, for a more detailed discussion of risks, uncertainties and factors that could cause actual results to differ from those discussed in the forward-looking statements.
These forward-looking statements reflect management's current expectations based on all information available to management and its knowledge of LCNB’s business and operations. Additionally, LCNB’s financial condition, results of operations, plans, objectives, future performance and business are subject to risks and uncertainties that may cause actual results to differ materially. These factors include, but are not limited to:
1.the success, impact, and timing of the implementation of LCNB’s business strategies;
2.the significant risks and uncertainties for LCNB's business, results of operations and financial condition, as well as its regulatory capital and liquidity ratios and other regulatory requirements, caused by the COVID-19 pandemic, which will depend on several factors, including the scope and duration of the pandemic, its influence on financial markets, the effectiveness of LCNB's work from home arrangements and staffing levels in operational facilities, the impact of market participants on which LCNB relies and actions taken by governmental authorities and other third parties in response to the pandemic;
3.LCNB’s ability to integrate recent and future acquisitions may be unsuccessful, or may be more difficult, time-consuming or costly than expected;
4.LCNB may incur increased charge-offs in the future;
5.LCNB may face competitive loss of customers;
6.changes in the interest rate environment may have results on LCNB’s operations materially different from those anticipated by LCNB’s market risk management functions;
7.changes in general economic conditions and increased competition could adversely affect LCNB’s operating results;
8.changes in regulations and government policies affecting bank holding companies and their subsidiaries, including changes in monetary policies, could negatively impact LCNB’s operating results;
9.LCNB may experience difficulties growing loan and deposit balances;
10.United States trade relations with foreign countries could negatively impact the financial condition of LCNB's customers, which could adversely affect LCNB 's operating results and financial condition;
11.deterioration in the financial condition of the U.S. banking system may impact the valuations of investments LCNB has made in the securities of other financial institutions resulting in either actual losses or other than temporary impairments on such investments;
12.difficulties with technology or data security breaches, including cyberattacks, that could negatively affect LCNB's ability to conduct business and its relationships with customers, vendors, and others;
13.adverse weather events and natural disasters and global and/or national epidemics; and
14.government intervention in the U.S. financial system, including the effects of recent legislative, tax, accounting and regulatory actions and reforms, including the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Jumpstart Our Business Startups Act, the Consumer Financial Protection Bureau, the capital ratios of Basel III as adopted by the federal banking authorities, and the Tax Cuts and Jobs Act.
Forward-looking statements made herein reflect management's expectations as of the date such statements are made. Such information is provided to assist shareholders and potential investors in understanding current and anticipated financial operations of LCNB and is included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. LCNB undertakes no obligation to update any forward-looking statement to reflect events or circumstances that arise after the date such statements are made.
Document
Exhibit 99.2
LCNB Corp. and Subsidiaries
Financial Highlights
(Dollars in thousands, except per share amounts)
(Unaudited)
| Three Months Ended | Nine Months Ended | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 9/30/2020 | 6/30/2020 | 3/31/2020 | 12/31/2019 | 9/30/2019 | 9/30/2020 | 9/30/2019 | ||||||||||
| Condensed Income Statement | ||||||||||||||||
| Interest income | $ | 15,322 | 15,957 | 16,556 | 16,424 | 16,329 | 47,835 | 48,770 | ||||||||
| Interest expense | 1,793 | 1,959 | 2,378 | 2,577 | 2,751 | 6,130 | 8,211 | |||||||||
| Net interest income | 13,529 | 13,998 | 14,178 | 13,847 | 13,578 | 41,705 | 40,559 | |||||||||
| Provision (credit) for loan losses | 976 | 16 | 1,173 | (6) | 264 | 2,165 | 213 | |||||||||
| Net interest income after provision | 12,553 | 13,982 | 13,005 | 13,853 | 13,314 | 39,540 | 40,346 | |||||||||
| Non-interest income | 4,278 | 3,319 | 3,839 | 3,222 | 3,356 | 11,436 | 9,126 | |||||||||
| Non-interest expense | 11,653 | 11,116 | 11,072 | 11,007 | 10,982 | 33,841 | 32,515 | |||||||||
| Income before income taxes | 5,178 | 6,185 | 5,772 | 6,068 | 5,688 | 17,135 | 16,957 | |||||||||
| Provision for income taxes | 928 | 1,128 | 746 | 1,238 | 961 | 2,802 | 2,875 | |||||||||
| Net income | $ | 4,250 | 5,057 | 5,026 | 4,830 | 4,727 | 14,333 | 14,082 | ||||||||
| Amort/Accret income on acquired loans | $ | 181 | 294 | 667 | 400 | 302 | 1,142 | 881 | ||||||||
| Amort/Accret expenses on acquired interest-bearing liabilities | $ | — | 2 | 3 | 3 | 4 | 5 | 290 | ||||||||
| Tax-equivalent net interest income | $ | 13,594 | 14,066 | 14,254 | 13,937 | 13,679 | 41,914 | 40,915 | ||||||||
| Per Share Data | ||||||||||||||||
| Dividends per share | $ | 0.18 | 0.18 | 0.18 | 0.18 | 0.17 | 0.54 | 0.51 | ||||||||
| Basic earnings per common share | $ | 0.33 | 0.39 | 0.39 | 0.37 | 0.36 | 1.11 | 1.07 | ||||||||
| Diluted earnings per common share | $ | 0.33 | 0.39 | 0.39 | 0.37 | 0.36 | 1.11 | 1.07 | ||||||||
| Book value per share | $ | 18.46 | 18.27 | 18.00 | 17.63 | 17.44 | 18.46 | 17.44 | ||||||||
| Tangible book value per share | $ | 13.66 | 13.47 | 13.18 | 12.78 | 12.57 | 13.66 | 12.57 | ||||||||
| Weighted average common shares outstanding: | ||||||||||||||||
| Basic | 12,937,865 | 12,940,975 | 12,926,077 | 12,912,106 | 12,932,950 | 12,934,987 | 13,135,134 | |||||||||
| Diluted | 12,937,901 | 12,941,001 | 12,927,666 | 12,916,000 | 12,937,145 | 12,935,388 | 13,139,100 | |||||||||
| Shares outstanding at period end | 12,926,686 | 12,975,879 | 12,969,076 | 12,936,783 | 12,927,463 | 12,926,686 | 12,927,463 | |||||||||
| Selected Financial Ratios | ||||||||||||||||
| Return on average assets | 0.97 | % | 1.19 | % | 1.23 | % | 1.17 | % | 1.13 | % | 1.13 | % | 1.15 | % | ||
| Return on average equity | 7.08 | % | 8.63 | % | 8.75 | % | 8.42 | % | 8.33 | % | 8.14 | % | 8.42 | % | ||
| Return on average tangible equity | 9.56 | % | 11.74 | % | 12.00 | % | 11.63 | % | 11.57 | % | 11.07 | % | 11.75 | % | ||
| Dividend payout ratio | 54.55 | % | 46.15 | % | 46.15 | % | 48.65 | % | 47.22 | % | 48.65 | % | 47.66 | % | ||
| Net interest margin (tax equivalent) | 3.47 | % | 3.70 | % | 3.92 | % | 3.76 | % | 3.67 | % | 3.69 | % | 3.70 | % | ||
| Efficiency ratio (tax equivalent) | 65.20 | % | 63.94 | % | 61.19 | % | 64.15 | % | 64.47 | % | 63.43 | % | 64.98 | % | ||
| Selected Balance Sheet Items | ||||||||||||||||
| Cash and cash equivalents | $ | 24,485 | 42,736 | 24,795 | 20,765 | 22,826 | ||||||||||
| Debt and equity securities | 199,044 | 194,883 | 183,123 | 219,791 | 239,730 | |||||||||||
| Loans: | ||||||||||||||||
| Commercial and industrial | $ | 124,628 | 125,492 | 85,356 | 78,306 | 71,576 | ||||||||||
| Commercial, secured by real estate | 843,943 | 833,286 | 829,461 | 804,953 | 797,842 | |||||||||||
| Residential real estate | 327,689 | 334,349 | 318,009 | 322,533 | 320,703 | |||||||||||
| Consumer | 36,504 | 32,859 | 28,955 | 25,232 | 23,918 | |||||||||||
| Agricultural | 8,920 | 11,071 | 10,519 | 11,509 | 11,525 | |||||||||||
| Other, including deposit overdrafts | 403 | 283 | 436 | 1,193 | 456 | |||||||||||
| Deferred net origination fees | (1,927) | (1,902) | (349) | (275) | (128) | |||||||||||
| Loans, gross | 1,340,160 | 1,335,438 | 1,272,387 | 1,243,451 | 1,225,892 | |||||||||||
| Less allowance for loan losses | 5,974 | 5,016 | 5,008 | 4,045 | 4,167 | |||||||||||
| Loans, net | $ | 1,334,186 | 1,330,422 | 1,267,379 | 1,239,406 | 1,221,725 | ||||||||||
| Total earning assets | $ | 1,547,538 | 1,554,537 | 1,462,485 | 1,466,988 | 1,470,074 | ||||||||||
| Total assets | 1,725,615 | 1,735,332 | 1,636,280 | 1,639,308 | 1,644,447 | |||||||||||
| Total deposits | 1,430,394 | 1,438,921 | 1,345,872 | 1,348,280 | 1,355,383 | |||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 9/30/2020 | 6/30/2020 | 3/31/2020 | 12/31/2019 | 9/30/2019 | 9/30/2020 | 9/30/2019 | ||||||||||
| Selected Balance Sheet Items, continued | ||||||||||||||||
| Long-term debt | 31,999 | 33,998 | 35,996 | 40,994 | 41,990 | |||||||||||
| Total shareholders’ equity | 238,585 | 237,047 | 233,478 | 228,048 | 225,492 | |||||||||||
| Equity to assets ratio | 13.83 | % | 13.66 | % | 14.27 | % | 13.91 | % | 13.71 | % | ||||||
| Loans to deposits ratio | 93.69 | % | 92.81 | % | 94.54 | % | 92.22 | % | 90.45 | % | ||||||
| Tangible common equity (TCE) | $ | 176,624 | 174,823 | 170,994 | 165,304 | 162,485 | ||||||||||
| Tangible common assets (TCA) | 1,663,654 | 1,673,108 | 1,573,796 | 1,576,564 | 1,581,440 | |||||||||||
| TCE/TCA | 10.62 | % | 10.45 | % | 10.87 | % | 10.49 | % | 10.27 | % | ||||||
| Selected Average Balance Sheet Items | ||||||||||||||||
| Cash and cash equivalents | $ | 42,661 | 46,292 | 25,101 | 26,501 | 28,293 | 37,988 | 27,600 | ||||||||
| Debt and equity securities | 197,788 | 182,371 | 204,912 | 231,115 | 243,553 | 195,033 | 253,113 | |||||||||
| Loans | $ | 1,339,608 | 1,318,753 | 1,252,554 | 1,230,845 | 1,227,806 | 1,303,770 | 1,218,183 | ||||||||
| Less allowance for loan losses | 5,250 | 4,998 | 3,938 | 4,076 | 3,986 | 4,730 | 4,049 | |||||||||
| Net loans | $ | 1,334,358 | 1,313,755 | 1,248,616 | 1,226,769 | 1,223,820 | 1,299,040 | 1,214,134 | ||||||||
| Total earning assets | $ | 1,558,886 | 1,528,610 | 1,462,946 | 1,469,469 | 1,480,096 | 1,516,967 | 1,479,983 | ||||||||
| Total assets | 1,741,998 | 1,704,303 | 1,638,486 | 1,643,793 | 1,654,034 | 1,695,103 | 1,642,186 | |||||||||
| Total deposits | 1,445,573 | 1,412,082 | 1,346,770 | 1,352,101 | 1,365,702 | 1,401,636 | 1,350,678 | |||||||||
| Short-term borrowings | 0 | 82 | 1,415 | 622 | 468 | 497 | 7,898 | |||||||||
| Long-term debt | 33,020 | 34,964 | 38,325 | 41,742 | 41,988 | 35,427 | 43,067 | |||||||||
| Total shareholders’ equity | 238,990 | 235,587 | 231,058 | 227,595 | 225,216 | 235,225 | 223,644 | |||||||||
| Equity to assets ratio | 13.72 | % | 13.82 | % | 14.10 | % | 13.85 | % | 13.62 | % | 13.88 | % | 13.62 | % | ||
| Loans to deposits ratio | 92.67 | % | 93.39 | % | 93.00 | % | 91.03 | % | 89.90 | % | 93.02 | % | 90.19 | % | ||
| Asset Quality | ||||||||||||||||
| Net charge-offs | $ | 18 | 8 | 210 | 115 | 209 | 236 | 92 | ||||||||
| Other real estate owned | — | — | — | 197 | 197 | — | 197 | |||||||||
| Non-accrual loans | 4,110 | 3,876 | 2,829 | 3,210 | 3,523 | 4,110 | 3,523 | |||||||||
| Loans past due 90 days or more and still accruing | 94 | 38 | 39 | — | — | 94 | — | |||||||||
| Total nonperforming loans | $ | 4,204 | 3,914 | 2,868 | 3,210 | 3,523 | 4,204 | 3,523 | ||||||||
| Net charge-offs to average loans | 0.01 | % | 0.00 | % | 0.07 | % | 0.04 | % | 0.07 | % | 0.02 | % | 0.01 | % | ||
| Allowance for loan losses to total loans | 0.45 | % | 0.38 | % | 0.39 | % | 0.33 | % | 0.34 | % | 0.45 | % | 0.34 | % | ||
| Nonperforming loans to total loans | 0.31 | % | 0.29 | % | 0.23 | % | 0.26 | % | 0.29 | % | 0.31 | % | 0.29 | % | ||
| Nonperforming assets to total assets | 0.24 | % | 0.23 | % | 0.18 | % | 0.21 | % | 0.23 | % | 0.24 | % | 0.23 | % | ||
| Assets Under Management | ||||||||||||||||
| LCNB Corp. total assets | $ | 1,725,615 | 1,735,332 | 1,636,280 | 1,639,308 | 1,644,447 | ||||||||||
| Trust and investments (fair value) | 524,502 | 516,076 | 455,974 | 435,664 | 411,724 | |||||||||||
| Mortgage loans serviced | 120,546 | 100,189 | 94,805 | 93,596 | 90,784 | |||||||||||
| Cash management | 119,520 | 116,615 | 77,471 | 75,948 | 117,530 | |||||||||||
| Brokerage accounts (fair value) | 267,307 | 255,276 | 235,278 | 268,059 | 262,038 | |||||||||||
| Total assets managed | $ | 2,757,490 | 2,723,488 | 2,499,808 | 2,512,575 | 2,526,523 |
LCNB CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(Dollars in thousands)
| September 30, 2020 (Unaudited) | December 31, 2019 | ||
|---|---|---|---|
| ASSETS: | |||
| Cash and due from banks | $ | 16,151 | 17,019 |
| Interest-bearing demand deposits | 8,334 | 3,746 | |
| Total cash and cash equivalents | 24,485 | 20,765 | |
| Investment securities: | |||
| Equity securities with a readily determinable fair value, at fair value | 2,213 | 2,312 | |
| Equity securities without a readily determinable fair value, at cost | 2,099 | 2,099 | |
| Debt securities, available-for-sale, at fair value | 157,936 | 178,000 | |
| Debt securities, held-to-maturity, at cost | 26,941 | 27,525 | |
| Federal Reserve Bank stock, at cost | 4,652 | 4,652 | |
| Federal Home Loan Bank stock, at cost | 5,203 | 5,203 | |
| Loans, net | 1,334,186 | 1,239,406 | |
| Premises and equipment, net | 35,309 | 34,787 | |
| Operating leases right of use asset | 5,729 | 5,444 | |
| Goodwill | 59,221 | 59,221 | |
| Core deposit and other intangibles | 3,539 | 4,006 | |
| Bank owned life insurance | 41,871 | 41,667 | |
| Interest receivable | 9,559 | 3,926 | |
| Other assets | 12,672 | 10,295 | |
| TOTAL ASSETS | $ | 1,725,615 | 1,639,308 |
| LIABILITIES: | |||
| Deposits: | |||
| Noninterest-bearing | $ | 426,989 | 354,391 |
| Interest-bearing | 1,003,405 | 993,889 | |
| Total deposits | 1,430,394 | 1,348,280 | |
| Long-term debt | 31,999 | 40,994 | |
| Operating lease liabilities | 5,790 | 5,446 | |
| Accrued interest and other liabilities | 18,847 | 16,540 | |
| TOTAL LIABILITIES | 1,487,030 | 1,411,260 | |
| COMMITMENTS AND CONTINGENT LIABILITIES | — | — | |
| SHAREHOLDERS' EQUITY: | |||
| Preferred shares – no par value, authorized 1,000,000 shares, none outstanding | — | — | |
| Common shares – no par value, authorized 19,000,000 shares; issued 14,157,303 and 14,111,810 shares at September 30, 2020 and December 31, 2019, respectively; outstanding 12,926,686 and 12,936,783 shares at September 30, 2020 and December 31, 2019, respectively | 142,310 | 141,791 | |
| Retained earnings | 111,760 | 104,431 | |
| Treasury shares at cost, 1,230,617 and 1,175,027 shares at September 30, 2020 and December 31, 2019, respectively | (19,639) | (18,847) | |
| Accumulated other comprehensive income, net of taxes | 4,154 | 673 | |
| TOTAL SHAREHOLDERS' EQUITY | 238,585 | 228,048 | |
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 1,725,615 | 1,639,308 |
LCNB CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended <br>September 30, | ||||
|---|---|---|---|---|---|
| 2020 | 2019 | 2020 | 2019 | ||
| INTEREST INCOME: | |||||
| Interest and fees on loans | $ | 14,379 | 14,872 | 44,428 | 44,072 |
| Dividends on equity securities with a readily determinable fair value | 13 | 15 | 40 | 47 | |
| Dividends on equity securities without a readily determinable fair value | 5 | 16 | 33 | 48 | |
| Interest on debt securities, taxable | 633 | 918 | 2,250 | 2,720 | |
| Interest on debt securities, non-taxable | 249 | 379 | 788 | 1,340 | |
| Interest on interest-bearing time deposits | — | 3 | — | 11 | |
| Other investments | 43 | 126 | 296 | 532 | |
| TOTAL INTEREST INCOME | 15,322 | 16,329 | 47,835 | 48,770 | |
| INTEREST EXPENSE: | |||||
| Interest on deposits | 1,567 | 2,475 | 5,416 | 7,225 | |
| Interest on short-term borrowings | — | 3 | 7 | 224 | |
| Interest on long-term debt | 226 | 273 | 707 | 762 | |
| TOTAL INTEREST EXPENSE | 1,793 | 2,751 | 6,130 | 8,211 | |
| NET INTEREST INCOME | 13,529 | 13,578 | 41,705 | 40,559 | |
| PROVISION FOR LOAN LOSSES | 976 | 264 | 2,165 | 213 | |
| NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | 12,553 | 13,314 | 39,540 | 40,346 | |
| NON-INTEREST INCOME: | |||||
| Fiduciary income | 1,275 | 1,123 | 3,579 | 3,215 | |
| Service charges and fees on deposit accounts | 1,506 | 1,616 | 4,038 | 4,421 | |
| Net gains (losses) on sales of debt securities | — | (20) | 221 | (37) | |
| Bank owned life insurance income | 275 | 289 | 1,163 | 654 | |
| Gains from sales of loans | 999 | 114 | 1,436 | 207 | |
| Other operating income | 223 | 234 | 999 | 666 | |
| TOTAL NON-INTEREST INCOME | 4,278 | 3,356 | 11,436 | 9,126 | |
| NON-INTEREST EXPENSE: | |||||
| Salaries and employee benefits | 6,863 | 6,403 | 20,279 | 18,808 | |
| Equipment expenses | 341 | 322 | 917 | 866 | |
| Occupancy expense, net | 740 | 751 | 2,145 | 2,258 | |
| State financial institutions tax | 424 | 433 | 1,280 | 1,307 | |
| Marketing | 471 | 410 | 906 | 1,009 | |
| Amortization of intangibles | 263 | 263 | 783 | 780 | |
| FDIC insurance premiums, net | 112 | (13) | 142 | 225 | |
| Contracted services | 435 | 455 | 1,312 | 1,394 | |
| Other real estate owned | 2 | 1 | (7) | 52 | |
| Merger-related expenses | — | 27 | — | 114 | |
| Other non-interest expense | 2,002 | 1,930 | 6,084 | 5,702 | |
| TOTAL NON-INTEREST EXPENSE | 11,653 | 10,982 | 33,841 | 32,515 | |
| INCOME BEFORE INCOME TAXES | 5,178 | 5,688 | 17,135 | 16,957 | |
| PROVISION FOR INCOME TAXES | 928 | 961 | 2,802 | 2,875 | |
| NET INCOME | $ | 4,250 | 4,727 | 14,333 | 14,082 |
| Dividends declared per common share | $ | 0.18 | 0.17 | 0.54 | 0.51 |
| Earnings per common share: | |||||
| Basic | 0.33 | 0.36 | 1.11 | 1.07 | |
| Diluted | 0.33 | 0.36 | 1.11 | 1.07 | |
| Weighted average common shares outstanding: | |||||
| Basic | 12,937,865 | 12,932,950 | 12,934,987 | 13,135,134 | |
| Diluted | 12,937,901 | 12,937,145 | 12,935,388 | 13,139,100 |
Contacts
LCNB Corp.
Eric J. Meilstrup, CEO and President, 800-344-BANK
Robert C. Haines II, Executive Vice President and CFO, 800-344-BANK