LEBANON, Ohio--(BUSINESS WIRE)--LCNB Corp. ("LCNB") (NASDAQ: LCNB) today announced financial results for the three months ended March 31, 2024.
Commenting on the financial results, LCNB President and Chief Executive Officer, Eric Meilstrup said, “Our first quarter performance reflects our near-term focus on integrating the November 2023 Cincinnati Federal acquisition and completing the merger with Eagle Financial Bancorp, Inc. (“EFBI” or “Eagle”), which I am pleased to report closed on April 12, 2024. I am excited by the opportunities underway to leverage the benefits of these two acquisitions and serve compelling communities within the greater Cincinnati region. While we expect one-time merger-related expenses will continue throughout the first half of 2024, we believe we are well positioned for earnings growth to reaccelerate in the fourth quarter of 2024.”
“We are simultaneously pursuing organic growth opportunities while providing our communities with best-in-class and local financial services. Total assets managed by LCNB Wealth Management increased 19.4% year-over-year and are up 8.6% over the past three months. The continued growth of LCNB Wealth Management demonstrates the value our financial, trust, and investment products provide to our local communities,” Mr. Meilstrup continued.
“In addition to the growth strategies underway, we are also focused on maintaining excellent asset quality and pursuing initiatives that strengthen our balance sheet. As we successfully execute these actions over the coming quarters, we believe we will enhance our earnings power, strengthen our competitive advantage, and position LCNB National Bank for long-term success. I am proud of the direction LCNB is headed, and I look forward to updating shareholders on the progress we are making,” concluded Mr. Meilstrup.
Income Statement
Net income for the 2024 first quarter was $1.9 million, compared to net income of $4.2 million for the same period last year. Earnings per basic and diluted share for the 2024 first quarter were $0.15, compared to $0.37 for the same period last year.
Adjusted net income accounts for the impact of one-time merger-related expenses, net of tax, associated with the Cincinnati Federal and EFBI acquisitions. Adjusted net income for the 2024 first quarter was $2.6 million, or $0.20 per diluted share, compared to $4.2 million, or $0.37 per diluted share, for the same period last year.
Net interest income for the three months ended March 31, 2024, was $13.9 million, compared to $13.9 million for the comparable period in 2023. An increase in interest income from loans due to a higher volume of average loans outstanding and the average rates earned on these loans was offset by increased interest expense from higher IRA and time certificate balances, increased long-term debt, and interest rate-related variances.
For the 2024 first quarter, LCNB’s tax equivalent net interest margin was 2.73%, compared to 3.28% for the same period last year. The decrease in the net interest margin reflects the current interest rate environment. As depositors moved funds from non-interest bearing deposits into higher rate products, the average rate paid on interest-bearing liabilities increased 142 basis points. During the same period, the average rate earned from interest-earning assets increased a more gradual 66 basis points.
Non-interest income for the three months ended March 31, 2024 was $3.9 million, compared to $3.6 million for the same period last year. The increase in non-interest income for the three-month period was primarily due to higher fiduciary income and higher gains on sales of loans due to a higher volume of loans sold. Management considers various factors when determining the volume of loans to sell, including liquidity needs and sources and pricing available in the secondary market. LCNB's inventory of new loans is also a factor. The first quarter 2024 was the first quarter that LCNB operated in the expanded market it obtained through the merger with Cincinnati Federal. Partially offsetting the increases in non-interest income during the quarter was a $214,000 pretax loss on the sale of approximately $9.8 million of debt securities.
Non-interest expense for the three months ended March 31, 2024 was $2.9 million higher than the comparable period in 2023, primarily due to higher personnel and operating expenses primarily associated with the integration of Cincinnati Federal and $775,000 of one-time expenses associated with the Cincinnati Federal and EFBI acquisitions.
Capital Allocation
During the three months ended March 31, 2024, LCNB did not repurchase any of its outstanding shares. At March 31, 2024, LCNB had 315,047 shares remaining under its February 2023 share repurchase program.
For the first quarter ended March 31, 2024, LCNB paid $0.22 per share in dividends, a 4.8% increase from $0.21 per share in the first quarter of last year.
Balance Sheet
Total assets at March 31, 2024 increased 18.6% to $2.28 billion from $1.92 billion at March 31, 2023. Net loans at March 31, 2024 increased 18.7% to $1.65 billion, compared to $1.39 billion at March 31, 2023. The year-over-year improvement resulted primarily from the contribution of continued organic loan growth and the completion of the Cincinnati Federal acquisition. Not including the Cincinnati Federal acquisition, total net loans increased 2.0% organically, or by $27.8 million from the same period a year ago.
Loans held for sale totaled $75.6 million at March 31, 2024 and are primarily composed of loans scheduled to be sold to an investor during the second quarter of 2024. LCNB anticipates that proceeds from the sale will be used for general corporate purposes, which may include supporting loan growth, paying down short-term borrowings and long-term debt, and adding to liquidity balances.
Total deposits at March 31, 2024 increased 15.9% to $1.86 billion, compared to $1.60 billion at March 31, 2023. Not including the Cincinnati Federal acquisition, total deposits increased 4.5% organically, or by $71.4 million since March 31, 2023.
Assets Under Management
Total assets managed at March 31, 2024 were a record $3.98 billion, compared to $3.16 billion at March 31, 2023. The year-over-year increase in total assets managed was primarily due to the Cincinnati Federal acquisition and organic growth in LCNB Corp. total assets, trust and investments, and brokerage accounts. Organically, trust and investments and brokerage accounts increased due to a higher number of new LCNB Wealth Management customer accounts and an increase in the fair value of managed assets. Mortgage loans serviced increased primarily due to the Cincinnati Federal acquisition.
Asset Quality
For the 2024 first quarter, LCNB recorded a provision for credit losses of $125,000, compared to a recovery of credit losses of $57,000 for the 2023 first quarter.
Net charge-offs for the 2024 first quarter were $45,000, or 0.01% of average loans, compared to net charge-offs of $16,000, or 0.00% of average loans, annualized, for the same period last year.
Total nonperforming loans, which include non-accrual loans and loans past due 90 days or more and still accruing interest, were $3.2 million, or 0.19% of total loans at March 31, 2024, compared to $701,000 or 0.05% of total loans at March 31, 2023. The year-over-year increase in nonaccrual loans was primarily due to one commercial real estate relationship, representing a balance of $2.6 million. The nonperforming assets to total assets ratio was 0.14% at March 31, 2024, compared to 0.04% at March 31, 2023.
Merger Agreement with Eagle Financial Bancorp, Inc.
On April 12, 2024, LCNB completed the acquisition of EFBI and the merger of EAGLE.bank with and into LCNB National Bank. EAGLE.bank operated three full-service banking offices in Cincinnati, Ohio.
With the addition of EFBI, LCNB now operates 36 full-service banking offices in Ohio and one branch office in Northern Kentucky. Assuming the transaction had been completed as of March 31, 2024, LCNB would have had total deposits of $1.99 billion and total loans of $1.79 billion at March 31, 2024.
About LCNB Corp.
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 and Northern Kentucky. 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 also provides community-oriented banking services to customers in Northern Kentucky through a bank office in Boone County, Kentucky. 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.
Forward-Looking Statements
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, 2023, 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:
- the success, impact, and timing of the implementation of LCNB’s business strategies;
- LCNB’s ability to integrate recent and future acquisitions may be unsuccessful or may be more difficult, time-consuming, or costly than expected;
- LCNB may incur increased loan charge-offs in the future and the allowance for credit losses may be inadequate;
- LCNB may face competitive loss of customers;
- changes in the interest rate environment, which may include further interest rate increases, may have results on LCNB’s operations materially different from those anticipated by LCNB’s market risk management functions;
- changes in general economic conditions and increased competition could adversely affect LCNB’s operating results;
- 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;
- LCNB may experience difficulties growing loan and deposit balances;
- 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;
- global geopolitical relations and/or conflicts could create financial market uncertainty and have negative impacts on commodities and currency, which could adversely affect LCNB's operating results and financial condition;
- difficulties with technology or data security breaches, including cyberattacks, could negatively affect LCNB's ability to conduct business and its relationships with customers, vendors, and others;
- adverse weather events and natural disasters and global and/or national epidemics could negatively affect LCNB’s customers given its concentrated geographic scope, which could impact LCNB’s operating results; and
- government intervention in the U.S. financial system, including the effects of 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, changes in deposit insurance premium levels, and any such future regulatory actions or reforms.
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.
Exhibit 99.2 |
||||||||||||||||||||
LCNB Corp. and Subsidiaries Financial Highlights (Dollars in thousands, except per share amounts) (Unaudited) |
||||||||||||||||||||
|
Three Months Ended |
|
||||||||||||||||||
|
03-31-2024 |
|
12-31-2023 |
|
09-30-2023 |
|
06-30-2023 |
|
03-31-2023 |
|
||||||||||
Condensed Income Statement |
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest income |
$ |
24,758 |
|
|
$ |
23,310 |
|
|
|
19,668 |
|
|
|
18,703 |
|
|
|
17,918 |
|
|
Interest expense |
|
10,863 |
|
|
|
8,651 |
|
|
|
6,097 |
|
|
|
4,526 |
|
|
|
3,976 |
|
|
Net interest income |
|
13,895 |
|
|
|
14,659 |
|
|
|
13,571 |
|
|
|
14,177 |
|
|
|
13,942 |
|
|
Provision for (recovery of) credit losses |
|
125 |
|
|
|
2,218 |
|
|
|
(114 |
) |
|
|
30 |
|
|
|
(57 |
) |
|
Net interest income after provision for (recovery of) credit losses |
|
13,770 |
|
|
|
12,441 |
|
|
|
13,685 |
|
|
|
14,147 |
|
|
|
13,999 |
|
|
Non-interest income |
|
3,929 |
|
|
|
4,606 |
|
|
|
3,578 |
|
|
|
3,646 |
|
|
|
3,581 |
|
|
Non-interest expense |
|
15,472 |
|
|
|
17,576 |
|
|
|
12,244 |
|
|
|
12,078 |
|
|
|
12,525 |
|
|
Income (loss) before income taxes |
|
2,227 |
|
|
|
(529 |
) |
|
|
5,019 |
|
|
|
5,715 |
|
|
|
5,055 |
|
|
Provision for (benefit from) income taxes |
|
312 |
|
|
|
(236 |
) |
|
|
949 |
|
|
|
1,021 |
|
|
|
898 |
|
|
Net income (loss) |
$ |
1,915 |
|
|
$ |
(293 |
) |
|
$ |
4,070 |
|
|
$ |
4,694 |
|
|
|
4,157 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Supplemental Income Statement Information |
|
|
|
|
|
|
|
|
|
|||||||||||
Amort/Accret income on acquired loans |
$ |
776 |
|
|
$ |
410 |
|
|
|
— |
|
|
|
— |
|
|
|
75 |
|
|
Tax-equivalent net interest income |
$ |
13,933 |
|
|
$ |
14,703 |
|
|
|
13,617 |
|
|
|
14,223 |
|
|
|
13,989 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Per Share Data |
|
|
|
|
|
|
|
|
|
|
||||||||||
Dividends per share |
$ |
0.22 |
|
|
$ |
0.22 |
|
|
|
0.21 |
|
|
|
0.21 |
|
|
|
0.21 |
|
|
Basic earnings (loss) per common share |
$ |
0.15 |
|
|
$ |
(0.02 |
) |
|
|
0.37 |
|
|
|
0.42 |
|
|
|
0.37 |
|
|
Diluted earnings (loss) per common share |
$ |
0.15 |
|
|
$ |
(0.02 |
) |
|
|
0.37 |
|
|
|
0.42 |
|
|
|
0.37 |
|
|
Book value per share |
$ |
17.67 |
|
|
$ |
17.86 |
|
|
|
18.10 |
|
|
|
18.20 |
|
|
|
18.22 |
|
|
Tangible book value per share |
$ |
11.03 |
|
|
$ |
11.16 |
|
|
|
12.72 |
|
|
|
12.81 |
|
|
|
12.86 |
|
|
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|||||||||||
Basic |
|
13,112,302 |
|
|
|
12,378,289 |
|
|
|
11,038,720 |
|
|
|
11,056,308 |
|
|
|
11,189,170 |
|
|
Diluted |
|
13,112,302 |
|
|
|
12,378,289 |
|
|
|
11,038,720 |
|
|
|
11,056,308 |
|
|
|
11,189,170 |
|
|
Shares outstanding at period end |
|
13,224,276 |
|
|
|
13,173,569 |
|
|
|
11,123,382 |
|
|
|
11,116,080 |
|
|
|
11,202,063 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Selected Financial Ratios |
|
|
|
|
|
|
|
|
|
|
||||||||||
Return on average assets |
|
0.34 |
% |
|
|
(0.05 |
)% |
|
|
0.82 |
% |
|
|
0.98 |
% |
|
|
0.88 |
% |
|
Return on average equity |
|
3.28 |
% |
|
|
(0.53 |
)% |
|
|
7.92 |
% |
|
|
9.22 |
% |
|
|
8.33 |
% |
|
Return on average tangible common equity |
|
4.39 |
% |
|
|
(0.72 |
)% |
|
|
11.21 |
% |
|
|
13.07 |
% |
|
|
11.85 |
% |
|
Dividend payout ratio |
|
146.67 |
% |
|
|
NM |
|
|
|
56.76 |
% |
|
|
50.00 |
% |
|
|
56.76 |
% |
|
Net interest margin (tax equivalent) |
|
2.72 |
% |
|
|
2.99 |
% |
|
|
3.04 |
% |
|
|
3.28 |
% |
|
|
3.28 |
% |
|
Efficiency ratio (tax equivalent) |
|
86.62 |
% |
|
|
91.02 |
% |
|
|
71.21 |
% |
|
|
67.59 |
% |
|
|
71.29 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Selected Balance Sheet Items |
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents |
$ |
32,951 |
|
|
$ |
39,723 |
|
|
|
43,422 |
|
|
|
26,020 |
|
|
|
31,876 |
|
|
Debt and equity securities |
|
306,775 |
|
|
|
318,723 |
|
|
|
309,094 |
|
|
|
314,763 |
|
|
|
328,194 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans: |
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial and industrial |
$ |
122,229 |
|
|
$ |
120,411 |
|
|
|
125,751 |
|
|
|
127,553 |
|
|
|
124,240 |
|
|
Commercial, secured by real estate |
|
1,099,601 |
|
|
|
1,107,556 |
|
|
|
981,787 |
|
|
|
961,173 |
|
|
|
932,208 |
|
|
Residential real estate |
|
398,250 |
|
|
|
459,073 |
|
|
|
313,286 |
|
|
|
312,338 |
|
|
|
303,051 |
|
|
Consumer |
|
24,137 |
|
|
|
25,578 |
|
|
|
27,018 |
|
|
|
29,007 |
|
|
|
28,611 |
|
|
Agricultural |
|
12,647 |
|
|
|
10,952 |
|
|
|
11,278 |
|
|
|
9,955 |
|
|
|
7,523 |
|
|
Other, including deposit overdrafts |
|
73 |
|
|
|
82 |
|
|
|
80 |
|
|
|
69 |
|
|
|
62 |
|
|
Deferred net origination fees |
|
(583 |
) |
|
|
(181 |
) |
|
|
(796 |
) |
|
|
(844 |
) |
|
|
(865 |
) |
|
Loans, gross |
|
1,656,354 |
|
|
|
1,723,471 |
|
|
|
1,458,404 |
|
|
|
1,439,251 |
|
|
|
1,394,830 |
|
|
Less allowance for credit losses |
|
10,557 |
|
|
|
10,525 |
|
|
|
7,932 |
|
|
|
7,956 |
|
|
|
7,858 |
|
|
Loans, net |
$ |
1,645,797 |
|
|
|
1,712,946 |
|
|
|
1,450,472 |
|
|
|
1,431,295 |
|
|
|
1,386,972 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans held for sale |
|
75,581 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
NM - Not Meaningful |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Three Months Ended |
|
||||||||||||||||||
|
03-31-2024 |
|
12-31-2023 |
|
09-30-2023 |
|
06-30-2023 |
|
03-31-2023 |
|
||||||||||
Selected Balance Sheet Items, continued |
|
|
|
|
|
|
|
|
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for Credit Losses on Loans: |
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for credit losses, beginning of period |
$ |
10,525 |
|
|
|
7,932 |
|
|
|
7,956 |
|
|
|
7,858 |
|
|
|
5,646 |
|
|
Cumulative change in accounting principle - ASC 326 |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,196 |
|
|
Fair value adjustment for purchased credit deteriorated loans |
|
— |
|
|
|
493 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Provision for credit losses |
|
77 |
|
|
|
2,203 |
|
|
|
9 |
|
|
|
131 |
|
|
|
32 |
|
|
Losses charged off |
|
(78 |
) |
|
|
(126 |
) |
|
|
(57 |
) |
|
|
(49 |
) |
|
|
(36 |
) |
|
Recoveries |
|
33 |
|
|
|
23 |
|
|
|
24 |
|
|
|
16 |
|
|
|
20 |
|
|
Allowance for credit losses, end of period |
$ |
10,557 |
|
|
|
10,525 |
|
|
|
7,932 |
|
|
|
7,956 |
|
|
|
7,858 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total earning assets |
$ |
1,971,130 |
|
|
$ |
2,045,382 |
|
|
|
1,787,796 |
|
|
|
1,756,157 |
|
|
$ |
1,736,829 |
|
|
Total assets |
|
2,283,151 |
|
|
|
2,291,592 |
|
|
|
1,981,668 |
|
|
|
1,950,763 |
|
|
|
1,924,531 |
|
|
Total deposits |
|
1,858,493 |
|
|
|
1,824,389 |
|
|
|
1,616,890 |
|
|
|
1,596,709 |
|
|
|
1,603,881 |
|
|
Short-term borrowings |
|
10,000 |
|
|
|
97,395 |
|
|
|
30,000 |
|
|
|
112,289 |
|
|
|
76,500 |
|
|
Long-term debt |
|
162,638 |
|
|
|
113,123 |
|
|
|
112,641 |
|
|
|
18,122 |
|
|
|
18,598 |
|
|
Total shareholders’ equity |
|
233,663 |
|
|
|
235,303 |
|
|
|
201,349 |
|
|
|
202,316 |
|
|
|
204,072 |
|
|
Equity to assets ratio |
|
10.23 |
% |
|
|
10.27 |
% |
|
|
10.16 |
% |
|
|
10.37 |
% |
|
|
10.60 |
% |
|
Loans to deposits ratio |
|
89.12 |
% |
|
|
94.47 |
% |
|
|
90.20 |
% |
|
|
90.14 |
% |
|
|
86.97 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Tangible common equity (TCE) |
$ |
145,850 |
|
|
$ |
146,999 |
|
|
|
141,508 |
|
|
|
142,362 |
|
|
|
144,006 |
|
|
Tangible common assets (TCA) |
|
2,195,338 |
|
|
|
2,203,288 |
|
|
|
1,921,827 |
|
|
|
1,890,809 |
|
|
|
1,864,457 |
|
|
TCE/TCA |
|
6.64 |
% |
|
|
6.67 |
% |
|
|
7.36 |
% |
|
|
7.53 |
% |
|
|
7.72 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Selected Average Balance Sheet Items |
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents |
$ |
51,366 |
|
|
$ |
49,436 |
|
|
|
36,177 |
|
|
|
30,742 |
|
|
|
35,712 |
|
|
Debt and equity securities |
|
310,771 |
|
|
|
310,274 |
|
|
|
313,669 |
|
|
|
321,537 |
|
|
|
327,123 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans, including loans held for sale |
$ |
1,722,568 |
|
|
$ |
1,622,911 |
|
|
|
1,451,153 |
|
|
|
1,405,939 |
|
|
|
1,389,385 |
|
|
Less allowance for credit losses on loans |
|
10,523 |
|
|
|
8,826 |
|
|
|
7,958 |
|
|
|
7,860 |
|
|
|
7,522 |
|
|
Net loans |
$ |
1,712,045 |
|
|
|
1,614,085 |
|
|
|
1,443,195 |
|
|
|
1,398,079 |
|
|
|
1,381,863 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total earning assets, including loans held for sale |
$ |
2,056,656 |
|
|
$ |
1,952,121 |
|
|
|
1,775,713 |
|
|
|
1,737,256 |
|
|
|
1,729,008 |
|
|
Total assets |
|
2,294,766 |
|
|
|
2,182,477 |
|
|
|
1,971,269 |
|
|
|
1,927,956 |
|
|
|
1,921,742 |
|
|
Total deposits |
|
1,824,546 |
|
|
|
1,759,677 |
|
|
|
1,610,508 |
|
|
|
1,604,346 |
|
|
|
1,583,857 |
|
|
Short-term borrowings |
|
65,052 |
|
|
|
64,899 |
|
|
|
63,018 |
|
|
|
79,485 |
|
|
|
94,591 |
|
|
Long-term debt |
|
150,177 |
|
|
|
115,907 |
|
|
|
72,550 |
|
|
|
18,514 |
|
|
|
18,983 |
|
|
Total shareholders’ equity |
|
235,119 |
|
|
|
220,678 |
|
|
|
203,967 |
|
|
|
204,085 |
|
|
|
202,419 |
|
|
Equity to assets ratio |
|
10.25 |
% |
|
|
10.11 |
% |
|
|
10.35 |
% |
|
|
10.59 |
% |
|
|
10.53 |
% |
|
Loans to deposits ratio |
|
94.41 |
% |
|
|
92.23 |
% |
|
|
90.11 |
% |
|
|
87.63 |
% |
|
|
87.72 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Asset Quality |
|
|
|
|
|
|
|
|
|
|
||||||||||
Net charge-offs |
$ |
45 |
|
|
$ |
102 |
|
|
|
33 |
|
|
|
33 |
|
|
|
16 |
|
|
Other real estate owned |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Non-accrual loans |
$ |
2,719 |
|
|
$ |
80 |
|
|
|
85 |
|
|
|
451 |
|
|
|
701 |
|
|
Loans past due 90 days or more and still accruing |
|
524 |
|
|
|
72 |
|
|
|
176 |
|
|
|
256 |
|
|
|
— |
|
|
Total nonperforming loans |
$ |
3,243 |
|
|
|
152 |
|
|
|
261 |
|
|
|
707 |
|
|
|
701 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net charge-offs to average loans |
|
0.01 |
% |
|
|
0.02 |
% |
|
|
0.01 |
% |
|
|
0.01 |
% |
|
|
0.00 |
% |
|
Allowance for credit losses on loans to total loans |
|
0.64 |
% |
|
|
0.61 |
% |
|
|
0.54 |
% |
|
|
0.55 |
% |
|
|
0.56 |
% |
|
Nonperforming loans to total loans |
|
0.20 |
% |
|
|
0.01 |
% |
|
|
0.02 |
% |
|
|
0.05 |
% |
|
|
0.05 |
% |
|
Nonperforming assets to total assets |
|
0.14 |
% |
|
|
0.01 |
% |
|
|
0.01 |
% |
|
|
0.04 |
% |
|
|
0.04 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Three Months Ended |
|
||||||||||||||||||
|
03-31-2024 |
|
12-31-2023 |
|
09-30-2023 |
|
06-30-2023 |
|
03-31-2023 |
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Assets Under Management |
|
|
|
|
|
|
|
|
|
|
||||||||||
LCNB Corp. total assets |
$ |
2,283,151 |
|
|
|
2,291,592 |
|
|
|
1,981,668 |
|
|
|
1,950,763 |
|
|
|
1,924,531 |
|
|
Trust and investments (fair value) |
|
890,800 |
|
|
|
806,770 |
|
|
|
731,342 |
|
|
|
744,149 |
|
|
|
716,578 |
|
|
Mortgage loans serviced |
|
386,490 |
|
|
|
391,800 |
|
|
|
146,483 |
|
|
|
143,093 |
|
|
|
142,167 |
|
|
Cash management |
|
13,314 |
|
|
|
2,375 |
|
|
|
2,445 |
|
|
|
2,668 |
|
|
|
1,831 |
|
|
Brokerage accounts (fair value) |
|
411,211 |
|
|
|
392,390 |
|
|
|
368,854 |
|
|
|
384,889 |
|
|
|
374,066 |
|
|
Total assets managed |
$ |
3,984,966 |
|
|
|
3,884,927 |
|
|
|
3,230,792 |
|
|
|
3,225,562 |
|
|
|
3,159,173 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reconciliation of Net Income Less Tax-Effected Merger-Related Costs |
|
|
|
|
|
|||||||||||||||
Net income (loss) |
$ |
1,915 |
|
|
|
(293 |
) |
|
|
4,070 |
|
|
|
4,694 |
|
|
|
4,157 |
|
|
Merger expenses |
|
775 |
|
|
|
3,914 |
|
|
|
302 |
|
|
|
415 |
|
|
|
25 |
|
|
Provision for credit losses on non-PCD loans |
|
— |
|
|
|
1,722 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Tax effect |
|
(90 |
) |
|
|
(1,102 |
) |
|
|
(3 |
) |
|
|
(63 |
) |
|
|
(4 |
) |
|
Adjusted net income |
$ |
2,600 |
|
|
|
4,241 |
|
|
|
4,369 |
|
|
|
5,046 |
|
|
|
4,178 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted basic and diluted earnings per share |
$ |
0.20 |
|
|
$ |
0.34 |
|
|
|
0.40 |
|
|
|
0.45 |
|
|
|
0.37 |
|
|
Adjusted return on average assets |
|
0.46 |
% |
|
|
0.77 |
% |
|
|
0.88 |
% |
|
|
1.05 |
% |
|
|
0.88 |
% |
|
Adjusted return on average equity |
|
4.45 |
% |
|
|
7.62 |
% |
|
|
8.50 |
% |
|
|
9.92 |
% |
|
|
8.37 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
Three Months Ended March 31, |
|
Three Months Ended December 31, |
||||||||||||||||||||||||
|
|
2024 |
|
2023 |
|
2023 |
||||||||||||||||||||||
|
|
Average Outstanding Balance |
|
Interest Earned/ Paid |
|
Average Yield/ Rate |
|
Average Outstanding Balance |
|
Interest Earned/ Paid |
|
Average Yield/ Rate |
|
Average Outstanding Balance |
|
Interest Earned/ Paid |
|
Average Yield/ Rate |
||||||||||
Loans (1) |
|
$ |
1,722,568 |
|
|
22,682 |
|
|
5.30 |
% |
|
$ |
1,389,385 |
|
|
16,143 |
|
4.71 |
% |
|
$ |
1,622,911 |
|
|
21,113 |
|
5.16 |
% |
Interest-bearing demand deposits |
|
|
23,317 |
|
|
324 |
|
|
5.59 |
% |
|
|
12,500 |
|
|
157 |
|
5.09 |
% |
|
|
18,936 |
|
|
280 |
|
5.87 |
% |
Federal Reserve Bank stock |
|
|
5,509 |
|
|
(4 |
) |
|
(0.29 |
)% |
|
|
4,652 |
|
|
— |
|
— |
% |
|
|
4,930 |
|
|
144 |
|
11.59 |
% |
Federal Home Loan Bank stock |
|
|
16,239 |
|
|
341 |
|
|
8.45 |
% |
|
|
6,796 |
|
|
62 |
|
3.70 |
% |
|
|
12,607 |
|
|
273 |
|
8.59 |
% |
Investment securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Equity securities |
|
|
4,995 |
|
|
40 |
|
|
3.22 |
% |
|
|
4,337 |
|
|
37 |
|
3.46 |
% |
|
|
4,415 |
|
|
62 |
|
5.57 |
% |
Debt securities, taxable |
|
|
265,164 |
|
|
1,232 |
|
|
1.87 |
% |
|
|
286,369 |
|
|
1,343 |
|
1.90 |
% |
|
|
265,736 |
|
|
1,273 |
|
1.90 |
% |
Debt securities, non-taxable (2) |
|
|
18,864 |
|
|
181 |
|
|
3.86 |
% |
|
|
24,969 |
|
|
223 |
|
3.62 |
% |
|
|
22,586 |
|
|
209 |
|
3.67 |
% |
Total earnings assets |
|
|
2,056,656 |
|
|
24,796 |
|
|
4.85 |
% |
|
|
1,729,008 |
|
|
17,965 |
|
4.21 |
% |
|
|
1,952,121 |
|
|
23,354 |
|
4.75 |
% |
Non-earning assets |
|
|
248,633 |
|
|
|
|
|
|
|
200,256 |
|
|
|
|
|
|
|
239,182 |
|
|
|
|
|
||||
Allowance for credit losses |
|
|
(10,523 |
) |
|
|
|
|
|
|
(7,522 |
) |
|
|
|
|
|
|
(8,826 |
) |
|
|
|
|
||||
Total assets |
|
$ |
2,294,766 |
|
|
|
|
|
$ |
1,921,742 |
|
|
|
|
|
|
$ |
2,182,477 |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest-bearing demand and money market deposits |
|
$ |
643,199 |
|
|
3,917 |
|
|
2.45 |
% |
|
$ |
505,382 |
|
|
1,245 |
|
1.00 |
% |
|
$ |
574,349 |
|
|
2,710 |
|
1.87 |
% |
Savings deposits |
|
|
368,049 |
|
|
206 |
|
|
0.23 |
% |
|
|
415,873 |
|
|
139 |
|
0.14 |
% |
|
|
402,791 |
|
|
323 |
|
0.32 |
% |
IRA and time certificates |
|
|
370,130 |
|
|
4,067 |
|
|
4.42 |
% |
|
|
185,297 |
|
|
1,072 |
|
2.35 |
% |
|
|
302,434 |
|
|
3,321 |
|
4.36 |
% |
Short-term borrowings |
|
|
65,052 |
|
|
935 |
|
|
5.78 |
% |
|
|
94,591 |
|
|
1,304 |
|
5.59 |
% |
|
|
64,899 |
|
|
918 |
|
5.61 |
% |
Long-term debt |
|
|
150,177 |
|
|
1,738 |
|
|
4.65 |
% |
|
|
18,983 |
|
|
216 |
|
4.61 |
% |
|
|
115,907 |
|
|
1,379 |
|
4.72 |
% |
Total interest-bearing liabilities |
|
|
1,596,607 |
|
|
10,863 |
|
|
2.74 |
% |
|
|
1,220,126 |
|
|
3,976 |
|
1.32 |
% |
|
|
1,460,380 |
|
|
8,651 |
|
2.35 |
% |
Demand deposits |
|
|
443,168 |
|
|
|
|
|
|
|
477,305 |
|
|
|
|
|
|
|
480,103 |
|
|
|
|
|
||||
Other liabilities |
|
|
19,872 |
|
|
|
|
|
|
|
21,892 |
|
|
|
|
|
|
|
21,316 |
|
|
|
|
|
||||
Equity |
|
|
235,119 |
|
|
|
|
|
|
|
202,419 |
|
|
|
|
|
|
|
220,678 |
|
|
|
|
|
||||
Total liabilities and equity |
|
$ |
2,294,766 |
|
|
|
|
|
|
$ |
1,921,742 |
|
|
|
|
|
|
$ |
2,182,477 |
|
|
|
|
|
||||
Net interest rate spread (3) |
|
|
|
|
|
2.11 |
% |
|
|
|
|
|
2.89 |
% |
|
|
|
|
|
2.40 |
% |
|||||||
Net interest income and net interest margin on a taxable-equivalent basis (4) |
|
|
|
13,933 |
|
|
2.72 |
% |
|
|
|
13,989 |
|
3.28 |
% |
|
|
|
14,703 |
|
2.99 |
% |
||||||
Ratio of interest-earning assets to interest-bearing liabilities |
|
|
128.81 |
% |
|
|
|
|
|
|
141.71 |
% |
|
|
|
|
|
|
133.67 |
% |
|
|
|
|
||||
(1) |
Includes non-accrual loans and loans held for sale |
(2) |
Income from tax-exempt securities is included in interest income on a taxable-equivalent basis. Interest income has been divided by a factor comprised of the complement of the incremental tax rate of 21%. |
(3) |
The net interest spread is the difference between the average rate on total interest-earning assets and interest-bearing liabilities. |
(4) |
The net interest margin is the taxable-equivalent net interest income divided by average interest-earning assets. |
Exhibit 99.2 |
|||||||
LCNB CORP. AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS (Dollars in thousands) |
|||||||
|
March 31,
(Unaudited) |
|
December 31,
|
||||
ASSETS: |
|
|
|
||||
Cash and due from banks |
$ |
24,950 |
|
|
|
36,535 |
|
Interest-bearing demand deposits |
|
8,001 |
|
|
|
3,188 |
|
Total cash and cash equivalents |
|
32,951 |
|
|
|
39,723 |
|
Investment securities: |
|
|
|
||||
Equity securities with a readily determinable fair value, at fair value |
|
1,334 |
|
|
|
1,336 |
|
Equity securities without a readily determinable fair value, at cost |
|
3,666 |
|
|
|
3,666 |
|
Debt securities, available-for-sale, at fair value |
|
262,786 |
|
|
|
276,601 |
|
Debt securities, held-to-maturity, at cost, net of allowance for credit losses of $5 and $5 at March 31, 2024 and December 31, 2023, respectively |
|
16,746 |
|
|
|
16,858 |
|
Federal Reserve Bank stock, at cost |
|
5,774 |
|
|
|
5,086 |
|
Federal Home Loan Bank stock, at cost |
|
16,469 |
|
|
|
15,176 |
|
Loans, net of allowance for credit losses of $10,557 and 10,525 at March 31, 2024 and December 31, 2023, respectively |
|
1,645,797 |
|
|
|
1,712,946 |
|
Loans held for sale |
|
75,581 |
|
|
|
— |
|
Premises and equipment, net |
|
36,690 |
|
|
|
36,302 |
|
Operating lease right-of-use assets |
|
5,838 |
|
|
|
6,000 |
|
Goodwill |
|
79,559 |
|
|
|
79,509 |
|
Core deposit and other intangibles, net |
|
8,903 |
|
|
|
9,494 |
|
Bank-owned life insurance |
|
50,165 |
|
|
|
49,847 |
|
Interest receivable |
|
9,115 |
|
|
|
8,405 |
|
Other assets, net |
|
31,777 |
|
|
|
30,643 |
|
TOTAL ASSETS |
$ |
2,283,151 |
|
|
|
2,291,592 |
|
|
|
|
|
||||
LIABILITIES: |
|
|
|
||||
Deposits: |
|
|
|
||||
Noninterest-bearing |
$ |
435,580 |
|
|
|
462,267 |
|
Interest-bearing |
|
1,422,913 |
|
|
|
1,362,122 |
|
Total deposits |
|
1,858,493 |
|
|
|
1,824,389 |
|
Short-term borrowings |
|
10,000 |
|
|
|
97,395 |
|
Long-term debt |
|
162,638 |
|
|
|
113,123 |
|
Operating lease liabilities |
|
6,123 |
|
|
|
6,261 |
|
Accrued interest and other liabilities |
|
12,234 |
|
|
|
15,121 |
|
TOTAL LIABILITIES |
|
2,049,488 |
|
|
|
2,056,289 |
|
|
|
|
|
||||
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 16,435,659 and 16,384,952 shares at March 31, 2024 and December 31, 2023, respectively; outstanding 13,224,276 and 13,173,569 shares at March 31, 2024 and December 31, 2023, respectively |
|
174,082 |
|
|
|
173,637 |
|
Retained earnings |
|
139,050 |
|
|
|
140,017 |
|
Treasury shares at cost, 3,211,383 and 3,211,383 shares at March 31, 2024 and December 31, 2023, respectively |
|
(56,015 |
) |
|
|
(56,015 |
) |
Accumulated other comprehensive loss, net of taxes |
|
(23,454 |
) |
|
|
(22,336 |
) |
TOTAL SHAREHOLDERS' EQUITY |
|
233,663 |
|
|
|
235,303 |
|
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY |
$ |
2,283,151 |
|
|
$ |
2,291,592 |
|
Exhibit 99.2 |
|||||||
LCNB CORP. AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Dollars in thousands, except per share data) (Unaudited) |
|||||||
|
Three Months Ended
|
|
|||||
|
|
2024 |
|
|
2023 |
|
|
INTEREST INCOME: |
|
|
|
|
|||
Interest and fees on loans |
$ |
22,682 |
|
|
16,143 |
|
|
Dividends on equity securities: |
|
|
|
|
|||
With a readily determinable fair value |
|
9 |
|
|
17 |
|
|
Without a readily determinable fair value |
|
31 |
|
|
20 |
|
|
Interest on debt securities: |
|
|
|
|
|||
Taxable |
|
1,232 |
|
|
1,343 |
|
|
Non-taxable |
|
143 |
|
|
176 |
|
|
Other investments |
|
661 |
|
|
219 |
|
|
TOTAL INTEREST INCOME |
|
24,758 |
|
|
17,918 |
|
|
|
|
|
|
|
|||
INTEREST EXPENSE: |
|
|
|
|
|||
Interest on deposits |
|
8,190 |
|
|
2,456 |
|
|
Interest on short-term borrowings |
|
935 |
|
|
1,304 |
|
|
Interest on long-term debt |
|
1,738 |
|
|
216 |
|
|
TOTAL INTEREST EXPENSE |
|
10,863 |
|
|
3,976 |
|
|
NET INTEREST INCOME |
|
13,895 |
|
|
13,942 |
|
|
|
|
|
|
|
|||
PROVISION FOR (RECOVERY OF) CREDIT LOSSES |
|
125 |
|
|
(57 |
) |
|
NET INTEREST INCOME AFTER PROVISION FOR (RECOVERY OF) CREDIT LOSSES |
|
13,770 |
|
|
13,999 |
|
|
|
|
|
|
|
|||
NON-INTEREST INCOME: |
|
|
|
|
|||
Fiduciary income |
|
1,973 |
|
|
1,740 |
|
|
Service charges and fees on deposit accounts |
|
1,384 |
|
|
1,482 |
|
|
Net gains from sales of debt securities, available-for-sale |
|
(214 |
) |
|
— |
|
|
Bank-owned life insurance income |
|
318 |
|
|
271 |
|
|
Net gains from sales of loans |
|
522 |
|
|
6 |
|
|
Other operating income |
|
(54 |
) |
|
82 |
|
|
TOTAL NON-INTEREST INCOME |
|
3,929 |
|
|
3,581 |
|
|
|
|
|
|
|
|||
NON-INTEREST EXPENSE: |
|
|
|
|
|||
Salaries and employee benefits |
|
8,554 |
|
|
7,349 |
|
|
Equipment expenses |
|
390 |
|
|
361 |
|
|
Occupancy expense, net |
|
1,005 |
|
|
963 |
|
|
State financial institutions tax |
|
428 |
|
|
397 |
|
|
Marketing |
|
174 |
|
|
192 |
|
|
Amortization of intangibles |
|
236 |
|
|
111 |
|
|
FDIC insurance premiums, net |
|
504 |
|
|
215 |
|
|
Contracted services |
|
784 |
|
|
641 |
|
|
Merger-related expenses |
|
775 |
|
|
25 |
|
|
Other non-interest expense |
|
2,622 |
|
|
2,271 |
|
|
TOTAL NON-INTEREST EXPENSE |
|
15,472 |
|
|
12,525 |
|
|
INCOME BEFORE INCOME TAXES |
|
2,227 |
|
|
5,055 |
|
|
PROVISION FOR INCOME TAXES |
|
312 |
|
|
898 |
|
|
NET INCOME |
$ |
1,915 |
|
|
4,157 |
|
|
|
|
|
|
|
|||
Earnings per common share: |
|
|
|
|
|||
Basic |
$ |
0.15 |
|
|
0.37 |
|
|
Diluted |
$ |
0.15 |
|
|
0.37 |
|
|
Weighted average common shares outstanding: |
|
|
|
|
|||
Basic |
|
13,112,302 |
|
|
11,189,170 |
|
|
Diluted |
|
13,112,302 |
|
|
11,189,170 |
|
|
