LCNB Corp. Reports Financial Results for the Three and Twelve Months Ended December 31, 2023
Profitability impacted primarily by one-time acquisition related operating and provision expenses and higher interest expense
Core profitability remains solid and supported by record annual non-interest income
Asset quality remains excellent with total nonperforming loans to total loans of 0.01% at
LCNB successfully completed the
Eagle Financial Bancorp, Inc. acquisition expected to close during the 2024 second quarter
Commenting on the financial results, LCNB President and Chief Executive Officer
Income Statement
For the 2023 fourth quarter, LCNB reported a net loss of
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 2023 fourth quarter was
Pre-tax, pre-provision net income, adjusted for one-time acquisition related expense, was
Net interest income for the three months ended
Non-interest income for the three months ended
Non-interest expense for the three months ended
Capital Allocation
During the twelve months ended
For the full year ended
Balance Sheet
Total assets at
Total deposits at
Assets Under Management
Total assets managed at
Asset Quality
For the 2023 fourth quarter, LCNB recorded a provision for credit losses of
Net charge-offs for the 2023 fourth quarter were
Total nonperforming loans, which include non-accrual loans and loans past due 90 days or more and still accruing interest, decreased
Merger Agreement with Eagle Financial Bancorp, Inc.
LCNB and EFBI (OTCQB: EFBI) signed a definitive merger agreement on
Pursuant to the terms of the merger agreement, which has been approved by the Board of Directors of each company, EFBI shareholders will have the opportunity to elect to receive either 1.1401 shares of LCNB stock or
About
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
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 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 Coronavirus Aid, Relief, and Economic Security ("CARES") Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Jumpstart Our Business Startups Act, theConsumer Financial Protection Bureau , the capital ratios of Basel III as adopted by the federal banking authorities, the Tax Cuts and Jobs Act, 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.
Financial Highlights (Dollars in thousands, except per share amounts) (Unaudited) |
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|
Three Months Ended |
|
Twelve Months Ended |
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|
|
|
|
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|
|
|
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|
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|
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|
||||||||||||
Condensed Income Statement |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest income |
$ |
23,310 |
|
|
|
19,668 |
|
|
|
18,703 |
|
|
|
17,918 |
|
|
|
17,719 |
|
|
79,599 |
|
|
65,753 |
|
Interest expense |
|
8,651 |
|
|
|
6,097 |
|
|
|
4,526 |
|
|
|
3,976 |
|
|
|
1,511 |
|
|
23,250 |
|
|
4,711 |
|
Net interest income |
|
14,659 |
|
|
|
13,571 |
|
|
|
14,177 |
|
|
|
13,942 |
|
|
|
16,208 |
|
|
56,349 |
|
|
61,042 |
|
Provision for (recovery of) credit losses |
|
2,218 |
|
|
|
(114 |
) |
|
|
30 |
|
|
|
(57 |
) |
|
|
(19 |
) |
|
2,077 |
|
|
250 |
|
Net interest income after provision for (recovery of) credit losses |
|
12,441 |
|
|
|
13,685 |
|
|
|
14,147 |
|
|
|
13,999 |
|
|
|
16,227 |
|
|
54,272 |
|
|
60,792 |
|
Non-interest income |
|
4,606 |
|
|
|
3,578 |
|
|
|
3,646 |
|
|
|
3,581 |
|
|
|
3,629 |
|
|
15,411 |
|
|
14,288 |
|
Non-interest expense |
|
17,576 |
|
|
|
12,244 |
|
|
|
12,078 |
|
|
|
12,525 |
|
|
|
12,065 |
|
|
54,423 |
|
|
48,134 |
|
Income before income taxes |
|
(529 |
) |
|
|
5,019 |
|
|
|
5,715 |
|
|
|
5,055 |
|
|
|
7,791 |
|
|
15,260 |
|
|
26,946 |
|
Provision for (benefit from) income taxes |
|
(236 |
) |
|
|
949 |
|
|
|
1,021 |
|
|
|
898 |
|
|
|
1,383 |
|
|
2,632 |
|
|
4,818 |
|
Net income (loss) |
$ |
(293 |
) |
|
$ |
4,070 |
|
|
$ |
4,694 |
|
|
$ |
4,157 |
|
|
|
6,408 |
|
|
12,628 |
|
|
22,128 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Supplemental Income Statement Information |
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|
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|
|
|
|
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Amort/Accret income on acquired loans |
$ |
410 |
|
|
|
— |
|
|
|
— |
|
|
|
75 |
|
|
|
249 |
|
|
484 |
|
|
520 |
|
Tax-equivalent net interest income |
$ |
14,703 |
|
|
|
13,617 |
|
|
|
14,223 |
|
|
|
13,989 |
|
|
|
16,257 |
|
|
56,532 |
|
|
61,242 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Per Share Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Dividends per share |
$ |
0.22 |
|
|
|
0.21 |
|
|
|
0.21 |
|
|
|
0.21 |
|
|
|
0.21 |
|
|
0.85 |
|
|
0.81 |
|
Basic earnings (loss) per common share |
$ |
(0.02 |
) |
|
|
0.37 |
|
|
|
0.42 |
|
|
|
0.37 |
|
|
|
0.57 |
|
|
1.10 |
|
|
1.93 |
|
Diluted earnings (loss) per common share |
$ |
(0.02 |
) |
|
|
0.37 |
|
|
|
0.42 |
|
|
|
0.37 |
|
|
|
0.57 |
|
|
1.10 |
|
|
1.93 |
|
Book value per share |
$ |
17.86 |
|
|
|
18.10 |
|
|
|
18.20 |
|
|
|
18.22 |
|
|
|
17.82 |
|
|
17.86 |
|
|
17.82 |
|
Tangible book value per share |
$ |
11.16 |
|
|
|
12.72 |
|
|
|
12.81 |
|
|
|
12.86 |
|
|
|
12.48 |
|
|
11.16 |
|
|
12.48 |
|
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Basic |
|
12,378,289 |
|
|
|
11,038,720 |
|
|
|
11,056,308 |
|
|
|
11,189,170 |
|
|
|
11,211,328 |
|
|
11,417,857 |
|
|
11,410,981 |
|
Diluted |
|
12,378,289 |
|
|
|
11,038,720 |
|
|
|
11,056,308 |
|
|
|
11,189,170 |
|
|
|
11,211,328 |
|
|
11,417,857 |
|
|
11,410,981 |
|
Shares outstanding at period end |
|
13,173,569 |
|
|
|
11,123,382 |
|
|
|
11,116,080 |
|
|
|
11,202,063 |
|
|
|
11,259,080 |
|
|
13,173,569 |
|
|
11,259,080 |
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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Selected Financial Ratios |
|
|
|
|
|
|
|
|
|
|
|
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|
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Return on average assets |
|
(0.05 |
)% |
|
|
0.82 |
% |
|
|
0.98 |
% |
|
|
0.88 |
% |
|
|
1.34 |
% |
|
0.63 |
% |
|
1.16 |
% |
Return on average equity |
|
(0.53 |
)% |
|
|
7.92 |
% |
|
|
9.22 |
% |
|
|
8.33 |
% |
|
|
12.90 |
% |
|
6.08 |
% |
|
10.62 |
% |
Return on average tangible common equity |
|
(0.72 |
)% |
|
|
11.21 |
% |
|
|
13.07 |
% |
|
|
11.85 |
% |
|
|
18.59 |
% |
|
8.54 |
% |
|
14.96 |
% |
Dividend payout ratio |
|
NM |
|
|
|
56.76 |
% |
|
|
50.00 |
% |
|
|
56.76 |
% |
|
|
36.84 |
% |
|
77.27 |
% |
|
41.97 |
% |
Net interest margin (tax equivalent) |
|
2.99 |
% |
|
|
3.04 |
% |
|
|
3.28 |
% |
|
|
3.28 |
% |
|
|
3.77 |
% |
|
3.14 |
% |
|
3.55 |
% |
Efficiency ratio (tax equivalent) |
|
91.02 |
% |
|
|
71.21 |
% |
|
|
67.59 |
% |
|
|
71.29 |
% |
|
|
60.67 |
% |
|
75.65 |
% |
|
63.73 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Selected Balance Sheet Items |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents |
$ |
39,723 |
|
|
|
43,422 |
|
|
|
26,020 |
|
|
|
31,876 |
|
|
|
22,701 |
|
|
|
|
|
||
Debt and equity securities |
|
318,723 |
|
|
|
309,094 |
|
|
|
314,763 |
|
|
|
328,194 |
|
|
|
323,167 |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial and industrial |
$ |
120,411 |
|
|
|
125,751 |
|
|
|
127,553 |
|
|
|
124,240 |
|
|
|
120,236 |
|
|
|
|
|
||
Commercial, secured by real estate |
|
1,107,556 |
|
|
|
981,787 |
|
|
|
961,173 |
|
|
|
932,208 |
|
|
|
938,022 |
|
|
|
|
|
||
Residential real estate |
|
459,073 |
|
|
|
313,286 |
|
|
|
312,338 |
|
|
|
303,051 |
|
|
|
305,575 |
|
|
|
|
|
||
Consumer |
|
25,578 |
|
|
|
27,018 |
|
|
|
29,007 |
|
|
|
28,611 |
|
|
|
28,290 |
|
|
|
|
|
||
Agricultural |
|
10,952 |
|
|
|
11,278 |
|
|
|
9,955 |
|
|
|
7,523 |
|
|
|
10,054 |
|
|
|
|
|
||
Other, including deposit overdrafts |
|
82 |
|
|
|
80 |
|
|
|
69 |
|
|
|
62 |
|
|
|
81 |
|
|
|
|
|
||
Deferred net origination fees |
|
(181 |
) |
|
|
(796 |
) |
|
|
(844 |
) |
|
|
(865 |
) |
|
|
(980 |
) |
|
|
|
|
||
Loans, gross |
|
1,723,471 |
|
|
|
1,458,404 |
|
|
|
1,439,251 |
|
|
|
1,394,830 |
|
|
|
1,401,278 |
|
|
|
|
|
||
Less allowance for credit losses on loans |
|
10,525 |
|
|
|
7,932 |
|
|
|
7,956 |
|
|
|
7,858 |
|
|
|
5,646 |
|
|
|
|
|
||
Loans, net |
$ |
1,712,946 |
|
|
|
1,450,472 |
|
|
|
1,431,295 |
|
|
|
1,386,972 |
|
|
|
1,395,632 |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
"NM" - Not Meaningful |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Three Months Ended |
|
Twelve Months Ended |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Selected Balance Sheet Items, continued |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Allowance for Credit Losses on Loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Allowance for credit losses, beginning of period |
$ |
7,932 |
|
|
|
7,956 |
|
|
|
7,858 |
|
|
|
5,646 |
|
|
|
5,644 |
|
|
|
|
|
||
Cumulative change in accounting principle - ASC 326 |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,196 |
|
|
|
— |
|
|
|
|
|
||
Fair value adjustment for purchased credit deteriorated loans |
|
493 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
||
Provision for (recovery of) credit losses |
|
2,203 |
|
|
|
9 |
|
|
|
131 |
|
|
|
32 |
|
|
|
(19 |
) |
|
|
|
|
||
Losses charged off |
|
(126 |
) |
|
|
(57 |
) |
|
|
(49 |
) |
|
|
(36 |
) |
|
|
(60 |
) |
|
|
|
|
||
Recoveries |
|
23 |
|
|
|
24 |
|
|
|
16 |
|
|
|
20 |
|
|
|
81 |
|
|
|
|
|
||
Allowance for credit losses, end of period |
$ |
10,525 |
|
|
|
7,932 |
|
|
|
7,956 |
|
|
|
7,858 |
|
|
|
5,646 |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total earning assets |
$ |
2,045,382 |
|
|
|
1,787,796 |
|
|
|
1,756,157 |
|
|
|
1,736,829 |
|
|
$ |
1,726,902 |
|
|
|
|
|
||
Total assets |
|
2,291,592 |
|
|
|
1,981,668 |
|
|
|
1,950,763 |
|
|
|
1,924,808 |
|
|
|
1,919,398 |
|
|
|
|
|
||
Total deposits |
|
1,824,389 |
|
|
|
1,616,890 |
|
|
|
1,596,709 |
|
|
|
1,603,881 |
|
|
|
1,604,970 |
|
|
|
|
|
||
Short-term borrowings |
|
97,395 |
|
|
|
30,000 |
|
|
|
112,289 |
|
|
|
76,500 |
|
|
|
71,455 |
|
|
|
|
|
||
Long-term debt |
|
113,123 |
|
|
|
112,641 |
|
|
|
18,122 |
|
|
|
18,598 |
|
|
|
19,072 |
|
|
|
|
|
||
Total shareholders’ equity |
|
235,303 |
|
|
|
201,349 |
|
|
|
202,316 |
|
|
|
204,072 |
|
|
|
200,675 |
|
|
|
|
|
||
Equity to assets ratio |
|
10.27 |
% |
|
|
10.16 |
% |
|
|
10.37 |
% |
|
|
10.60 |
% |
|
|
10.46 |
% |
|
|
|
|
||
Loans to deposits ratio |
|
94.47 |
% |
|
|
90.20 |
% |
|
|
90.14 |
% |
|
|
86.97 |
% |
|
|
87.31 |
% |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Tangible common equity (TCE) |
$ |
146,999 |
|
|
|
141,508 |
|
|
|
142,362 |
|
|
|
144,006 |
|
|
|
140,489 |
|
|
|
|
|
||
Tangible common assets (TCA) |
|
2,203,288 |
|
|
|
1,921,827 |
|
|
|
1,890,809 |
|
|
|
1,864,742 |
|
|
|
1,859,212 |
|
|
|
|
|
||
TCE/TCA |
|
6.67 |
% |
|
|
7.36 |
% |
|
|
7.53 |
% |
|
|
7.72 |
% |
|
|
7.56 |
% |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Selected Average Balance Sheet Items |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents |
$ |
49,436 |
|
|
|
36,177 |
|
|
|
30,742 |
|
|
|
35,712 |
|
|
|
24,330 |
|
|
38,040 |
|
|
30,364 |
|
Debt and equity securities |
|
310,274 |
|
|
|
313,669 |
|
|
|
321,537 |
|
|
|
327,123 |
|
|
|
323,195 |
|
|
318,082 |
|
|
335,051 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loans |
$ |
1,622,911 |
|
|
|
1,451,153 |
|
|
|
1,405,939 |
|
|
|
1,389,385 |
|
|
|
1,383,809 |
|
|
1,467,981 |
|
|
1,380,272 |
|
Less allowance for credit losses on loans |
|
8,826 |
|
|
|
7,958 |
|
|
|
7,860 |
|
|
|
7,522 |
|
|
|
5,647 |
|
|
8,046 |
|
|
5,629 |
|
Net loans |
$ |
1,614,085 |
|
|
|
1,443,195 |
|
|
|
1,398,079 |
|
|
|
1,381,863 |
|
|
|
1,378,162 |
|
|
1,459,935 |
|
|
1,374,643 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total earning assets |
$ |
1,952,121 |
|
|
|
1,775,713 |
|
|
|
1,737,256 |
|
|
|
1,729,008 |
|
|
|
1,711,524 |
|
|
1,799,102 |
|
|
1,724,350 |
|
Total assets |
|
2,182,477 |
|
|
|
1,971,269 |
|
|
|
1,927,956 |
|
|
|
1,922,031 |
|
|
|
1,903,624 |
|
|
2,001,565 |
|
|
1,915,716 |
|
Total deposits |
|
1,759,677 |
|
|
|
1,610,508 |
|
|
|
1,604,346 |
|
|
|
1,583,857 |
|
|
|
1,637,201 |
|
|
1,640,000 |
|
|
1,652,309 |
|
Short-term borrowings |
|
64,899 |
|
|
|
63,018 |
|
|
|
79,485 |
|
|
|
94,591 |
|
|
|
21,433 |
|
|
75,383 |
|
|
14,482 |
|
Long-term debt |
|
115,907 |
|
|
|
72,550 |
|
|
|
18,514 |
|
|
|
18,983 |
|
|
|
23,855 |
|
|
56,798 |
|
|
17,910 |
|
Total shareholders’ equity |
|
220,678 |
|
|
|
203,967 |
|
|
|
204,085 |
|
|
|
202,419 |
|
|
|
197,014 |
|
|
207,827 |
|
|
208,271 |
|
Equity to assets ratio |
|
10.11 |
% |
|
|
10.35 |
% |
|
|
10.59 |
% |
|
|
10.53 |
% |
|
|
10.35 |
% |
|
10.38 |
% |
|
10.87 |
% |
Loans to deposits ratio |
|
92.23 |
% |
|
|
90.11 |
% |
|
|
87.63 |
% |
|
|
87.72 |
% |
|
|
84.52 |
% |
|
89.51 |
% |
|
83.54 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asset Quality |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net charge-offs (recoveries) |
$ |
102 |
|
|
|
33 |
|
|
|
33 |
|
|
|
16 |
|
|
|
(21 |
) |
|
184 |
|
|
110 |
|
Other real estate owned |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Non-accrual loans |
$ |
80 |
|
|
|
85 |
|
|
|
451 |
|
|
|
701 |
|
|
|
391 |
|
|
80 |
|
|
391 |
|
Loans past due 90 days or more and still accruing |
|
72 |
|
|
|
176 |
|
|
|
256 |
|
|
|
— |
|
|
|
39 |
|
|
72 |
|
|
39 |
|
Total nonperforming loans |
$ |
152 |
|
|
|
261 |
|
|
|
707 |
|
|
|
701 |
|
|
|
430 |
|
|
152 |
|
|
430 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net charge-offs (recoveries) to average loans |
|
0.02 |
% |
|
|
0.01 |
% |
|
|
0.01 |
% |
|
|
0.00 |
% |
|
|
(0.01 |
)% |
|
0.01 |
% |
|
0.01 |
% |
Allowance for credit losses on loans to total loans |
|
0.61 |
% |
|
|
0.54 |
% |
|
|
0.55 |
% |
|
|
0.56 |
% |
|
|
0.40 |
% |
|
|
|
|
||
Nonperforming loans to total loans |
|
0.01 |
% |
|
|
0.02 |
% |
|
|
0.05 |
% |
|
|
0.05 |
% |
|
|
0.03 |
% |
|
|
|
|
||
Nonperforming assets to total assets |
|
0.01 |
% |
|
|
0.01 |
% |
|
|
0.04 |
% |
|
|
0.04 |
% |
|
|
0.02 |
% |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Three Months Ended |
|
Twelve Months Ended |
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Assets Under Management |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
$ |
2,291,592 |
|
|
|
1,981,668 |
|
|
|
1,950,763 |
|
|
|
1,924,808 |
|
|
|
1,919,398 |
|
|
|
|
|
||
Trust and investments (fair value) |
|
806,770 |
|
|
|
731,342 |
|
|
|
744,149 |
|
|
|
716,578 |
|
|
|
678,366 |
|
|
|
|
|
||
Mortgage loans serviced |
|
391,800 |
|
|
|
146,483 |
|
|
|
143,093 |
|
|
|
142,167 |
|
|
|
148,412 |
|
|
|
|
|
||
Cash management |
|
2,375 |
|
|
|
2,445 |
|
|
|
2,668 |
|
|
|
1,831 |
|
|
|
1,925 |
|
|
|
|
|
||
Brokerage accounts (fair value) |
|
392,390 |
|
|
|
368,854 |
|
|
|
384,889 |
|
|
|
374,066 |
|
|
|
347,737 |
|
|
|
|
|
||
Total assets managed |
$ |
3,884,927 |
|
|
|
3,230,792 |
|
|
|
3,225,562 |
|
|
|
3,159,450 |
|
|
|
3,095,838 |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Reconciliation of Net Income Less Tax-Effected Merger-Related Costs |
|
|
|
|
|
|
|
|
|||||||||||||||||
Net income (loss) |
$ |
(293 |
) |
|
|
4,070 |
|
|
|
4,694 |
|
|
|
4,157 |
|
|
|
6,408 |
|
|
12,628 |
|
|
22,128 |
|
Merger expenses |
|
3,914 |
|
|
|
302 |
|
|
|
415 |
|
|
|
25 |
|
|
|
— |
|
|
4,656 |
|
|
— |
|
Provision for credit losses on non-PCD loans |
|
1,722 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
1,722 |
|
|
— |
|
Tax effect |
|
(1,102 |
) |
|
|
(3 |
) |
|
|
(63 |
) |
|
|
(4 |
) |
|
|
— |
|
|
(1,172 |
) |
|
— |
|
Adjusted net income |
$ |
4,241 |
|
|
|
4,369 |
|
|
|
5,046 |
|
|
|
4,178 |
|
|
|
6,408 |
|
|
17,834 |
|
|
22,128 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Adjusted basic and diluted earnings per share |
$ |
0.34 |
|
|
|
0.40 |
|
|
|
0.45 |
|
|
|
0.37 |
|
|
|
0.57 |
|
|
1.56 |
|
|
1.93 |
|
Adjusted return on average assets |
|
0.77 |
% |
|
|
0.88 |
% |
|
|
1.05 |
% |
|
|
0.88 |
% |
|
|
1.34 |
% |
|
0.89 |
% |
|
1.16 |
% |
Adjusted return on average equity |
|
7.62 |
% |
|
|
8.50 |
% |
|
|
9.92 |
% |
|
|
8.37 |
% |
|
|
12.90 |
% |
|
8.58 |
% |
|
10.62 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Three Months Ended |
|||||||||||||||||||||||
|
|
2023 |
|
2022 |
|
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) |
|
$ |
1,622,911 |
|
|
21,113 |
|
5.16 |
% |
|
$ |
1,383,809 |
|
|
15,887 |
|
4.55 |
% |
|
$ |
1,451,153 |
|
|
17,875 |
|
4.89 |
% |
Interest-bearing demand deposits |
|
|
18,936 |
|
|
280 |
|
5.87 |
% |
|
|
4,520 |
|
|
56 |
|
4.92 |
% |
|
|
10,891 |
|
|
152 |
|
5.54 |
% |
|
|
|
4,930 |
|
|
144 |
|
11.59 |
% |
|
|
4,652 |
|
|
140 |
|
11.94 |
% |
|
|
4,652 |
|
|
— |
|
— |
% |
|
|
|
12,607 |
|
|
273 |
|
8.59 |
% |
|
|
4,106 |
|
|
66 |
|
6.38 |
% |
|
|
7,007 |
|
|
134 |
|
7.59 |
% |
Investment securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Equity securities |
|
|
4,415 |
|
|
62 |
|
5.57 |
% |
|
|
4,353 |
|
|
29 |
|
2.64 |
% |
|
|
3,382 |
|
|
38 |
|
4.46 |
% |
Debt securities, taxable |
|
|
265,736 |
|
|
1,273 |
|
1.90 |
% |
|
|
283,442 |
|
|
1,355 |
|
1.90 |
% |
|
|
274,494 |
|
|
1,296 |
|
1.87 |
% |
Debt securities, non-taxable (2) |
|
|
22,586 |
|
|
209 |
|
3.67 |
% |
|
|
26,642 |
|
|
235 |
|
3.50 |
% |
|
|
24,134 |
|
|
219 |
|
3.60 |
% |
Total earnings assets |
|
|
1,952,121 |
|
|
23,354 |
|
4.75 |
% |
|
|
1,711,524 |
|
|
17,768 |
|
4.12 |
% |
|
|
1,775,713 |
|
|
19,714 |
|
4.40 |
% |
Non-earning assets |
|
|
239,182 |
|
|
|
|
|
|
|
197,747 |
|
|
|
|
|
|
|
203,514 |
|
|
|
|
|
|||
Allowance for credit losses |
|
|
(8,826 |
) |
|
|
|
|
|
|
(5,647 |
) |
|
|
|
|
|
|
(7,958 |
) |
|
|
|
|
|||
Total assets |
|
$ |
2,182,477 |
|
|
|
|
|
|
$ |
1,903,624 |
|
|
|
|
|
|
$ |
1,971,269 |
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Interest-bearing demand and money market deposits |
|
$ |
574,349 |
|
|
2,710 |
|
1.87 |
% |
|
$ |
520,158 |
|
|
610 |
|
0.47 |
% |
|
$ |
541,487 |
|
|
2,298 |
|
1.68 |
% |
Savings deposits |
|
|
402,791 |
|
|
323 |
|
0.32 |
% |
|
|
444,632 |
|
|
153 |
|
0.14 |
% |
|
|
379,515 |
|
|
129 |
|
0.13 |
% |
IRA and time certificates |
|
|
302,434 |
|
|
3,321 |
|
4.36 |
% |
|
|
150,175 |
|
|
426 |
|
1.13 |
% |
|
|
230,030 |
|
|
1,999 |
|
3.45 |
% |
Short-term borrowings |
|
|
64,899 |
|
|
918 |
|
5.61 |
% |
|
|
21,433 |
|
|
96 |
|
1.78 |
% |
|
|
63,018 |
|
|
830 |
|
5.23 |
% |
Long-term debt |
|
|
115,907 |
|
|
1,379 |
|
4.72 |
% |
|
|
23,855 |
|
|
226 |
|
3.76 |
% |
|
|
72,550 |
|
|
841 |
|
4.60 |
% |
Total interest-bearing liabilities |
|
|
1,460,380 |
|
|
8,651 |
|
2.35 |
% |
|
|
1,160,253 |
|
|
1,511 |
|
0.52 |
% |
|
|
1,286,600 |
|
|
6,097 |
|
1.88 |
% |
Demand deposits |
|
|
480,103 |
|
|
|
|
|
|
|
522,236 |
|
|
|
|
|
|
|
459,476 |
|
|
|
|
|
|||
Other liabilities |
|
|
21,316 |
|
|
|
|
|
|
|
24,121 |
|
|
|
|
|
|
|
21,226 |
|
|
|
|
|
|||
Equity |
|
|
220,678 |
|
|
|
|
|
|
|
197,014 |
|
|
|
|
|
|
|
203,967 |
|
|
|
|
|
|||
Total liabilities and equity |
|
$ |
2,182,477 |
|
|
|
|
|
|
$ |
1,903,624 |
|
|
|
|
|
|
$ |
1,971,269 |
|
|
|
|
|
|||
Net interest rate spread (3) |
|
|
|
|
|
2.40 |
% |
|
|
|
|
|
3.60 |
% |
|
|
|
|
|
2.52 |
% |
||||||
Net interest income and net interest margin on a taxable-equivalent basis (4) |
|
|
|
14,703 |
|
2.99 |
% |
|
|
|
16,257 |
|
3.77 |
% |
|
|
|
13,617 |
|
3.04 |
% |
||||||
Ratio of interest-earning assets to interest-bearing liabilities |
|
|
133.67 |
% |
|
|
|
|
|
|
147.51 |
% |
|
|
|
|
|
|
138.02 |
% |
|
|
|
|
(1) |
Includes non-accrual loans. |
|
(2) |
Income from tax-exempt securities is included in interest income on a taxable-equivalent basis. Interest income has been divided |
|
(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. |
CONSOLIDATED CONDENSED BALANCE SHEETS (Dollars in thousands) |
|||||||
|
|
|
|
||||
ASSETS: |
|
|
|
||||
Cash and due from banks |
$ |
36,535 |
|
|
|
20,244 |
|
Interest-bearing demand deposits |
|
3,188 |
|
|
|
2,457 |
|
Total cash and cash equivalents |
|
39,723 |
|
|
|
22,701 |
|
Investment securities: |
|
|
|
||||
Equity securities with a readily determinable fair value, at fair value |
|
1,336 |
|
|
|
2,273 |
|
Equity securities without a readily determinable fair value, at cost |
|
3,666 |
|
|
|
2,099 |
|
Debt securities, available-for-sale, at fair value |
|
276,601 |
|
|
|
289,850 |
|
Debt securities, held-to-maturity, at cost, net |
|
16,858 |
|
|
|
19,878 |
|
|
|
5,086 |
|
|
|
4,652 |
|
|
|
15,176 |
|
|
|
4,415 |
|
Loans, net |
|
1,712,946 |
|
|
|
1,395,632 |
|
Premises and equipment, net |
|
36,302 |
|
|
|
33,042 |
|
Operating lease right-of-use assets |
|
6,000 |
|
|
|
6,525 |
|
|
|
79,509 |
|
|
|
59,221 |
|
Core deposit and other intangibles, net |
|
9,494 |
|
|
|
1,827 |
|
Bank-owned life insurance |
|
49,847 |
|
|
|
44,298 |
|
Interest receivable |
|
8,405 |
|
|
|
7,482 |
|
Other assets, net |
|
30,643 |
|
|
|
25,503 |
|
TOTAL ASSETS |
$ |
2,291,592 |
|
|
|
1,919,398 |
|
|
|
|
|
||||
LIABILITIES: |
|
|
|
||||
Deposits: |
|
|
|
||||
Noninterest-bearing |
$ |
462,267 |
|
|
|
505,824 |
|
Interest-bearing |
|
1,362,122 |
|
|
|
1,099,146 |
|
Total deposits |
|
1,824,389 |
|
|
|
1,604,970 |
|
Short-term borrowings |
|
97,395 |
|
|
|
71,455 |
|
Long-term debt |
|
113,123 |
|
|
|
19,072 |
|
Operating lease liabilities |
|
6,261 |
|
|
|
6,647 |
|
Accrued interest and other liabilities |
|
15,121 |
|
|
|
16,579 |
|
TOTAL LIABILITIES |
|
2,056,289 |
|
|
|
1,718,723 |
|
|
|
|
|
||||
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 16,384,952 and 14,270,550 shares at |
|
173,637 |
|
|
|
144,069 |
|
Retained earnings |
|
140,017 |
|
|
|
139,249 |
|
|
|
(56,015 |
) |
|
|
(52,689 |
) |
Accumulated other comprehensive loss, net of taxes |
|
(22,336 |
) |
|
|
(29,954 |
) |
TOTAL SHAREHOLDERS' EQUITY |
|
235,303 |
|
|
|
200,675 |
|
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY |
$ |
2,291,592 |
|
|
$ |
1,919,398 |
|
CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Dollars in thousands, except per share data) (Unaudited) |
|||||||||||
|
Three Months Ended
|
|
Twelve Months Ended
|
||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
INTEREST INCOME: |
|
|
|
|
|
|
|
||||
Interest and fees on loans |
$ |
21,113 |
|
|
15,887 |
|
|
71,894 |
|
59,247 |
|
Dividends on equity securities: |
|
|
|
|
|
|
|
||||
With a readily determinable fair value |
|
9 |
|
|
16 |
|
|
43 |
|
56 |
|
Without a readily determinable fair value |
|
53 |
|
|
13 |
|
|
132 |
|
29 |
|
Interest on debt securities: |
|
|
|
|
|
|
|
||||
Taxable |
|
1,273 |
|
|
1,355 |
|
|
5,235 |
|
5,027 |
|
Non-taxable |
|
165 |
|
|
186 |
|
|
688 |
|
753 |
|
Other investments |
|
697 |
|
|
262 |
|
|
1,607 |
|
641 |
|
TOTAL INTEREST INCOME |
|
23,310 |
|
|
17,719 |
|
|
79,599 |
|
65,753 |
|
|
|
|
|
|
|
|
|
||||
INTEREST EXPENSE: |
|
|
|
|
|
|
|
||||
Interest on deposits |
|
6,354 |
|
|
1,189 |
|
|
16,571 |
|
3,682 |
|
Interest on short-term borrowings |
|
918 |
|
|
96 |
|
|
4,060 |
|
416 |
|
Interest on long-term debt |
|
1,379 |
|
|
226 |
|
|
2,619 |
|
613 |
|
TOTAL INTEREST EXPENSE |
|
8,651 |
|
|
1,511 |
|
|
23,250 |
|
4,711 |
|
NET INTEREST INCOME |
|
14,659 |
|
|
16,208 |
|
|
56,349 |
|
61,042 |
|
|
|
|
|
|
|
|
|
||||
PROVISION FOR (RECOVERY OF) CREDIT LOSSES |
|
2,218 |
|
|
(19 |
) |
|
2,077 |
|
250 |
|
NET INTEREST INCOME AFTER PROVISION FOR (RECOVERY OF) CREDIT LOSSES |
|
12,441 |
|
|
16,227 |
|
|
54,272 |
|
60,792 |
|
|
|
|
|
|
|
|
|
||||
NON-INTEREST INCOME: |
|
|
|
|
|
|
|
||||
Fiduciary income |
|
1,828 |
|
|
1,617 |
|
|
7,091 |
|
6,468 |
|
Service charges and fees on deposit accounts |
|
1,532 |
|
|
1,532 |
|
|
5,856 |
|
6,190 |
|
Bank-owned life insurance income |
|
306 |
|
|
271 |
|
|
1,136 |
|
1,074 |
|
Gains from sales of loans |
|
659 |
|
|
8 |
|
|
697 |
|
196 |
|
Other operating income |
|
281 |
|
|
201 |
|
|
631 |
|
360 |
|
TOTAL NON-INTEREST INCOME |
|
4,606 |
|
|
3,629 |
|
|
15,411 |
|
14,288 |
|
|
|
|
|
|
|
|
|
||||
NON-INTEREST EXPENSE: |
|
|
|
|
|
|
|
||||
Salaries and employee benefits |
|
7,654 |
|
|
7,192 |
|
|
29,108 |
|
28,483 |
|
Equipment expenses |
|
441 |
|
|
395 |
|
|
1,616 |
|
1,629 |
|
Occupancy expense, net |
|
934 |
|
|
767 |
|
|
3,301 |
|
3,067 |
|
State financial institutions tax |
|
439 |
|
|
428 |
|
|
1,628 |
|
1,740 |
|
Marketing |
|
366 |
|
|
339 |
|
|
1,101 |
|
1,184 |
|
Amortization of intangibles |
|
196 |
|
|
113 |
|
|
532 |
|
478 |
|
|
|
269 |
|
|
133 |
|
|
932 |
|
530 |
|
Contracted services |
|
798 |
|
|
601 |
|
|
2,776 |
|
2,503 |
|
Other real estate owned, net |
|
1 |
|
|
8 |
|
|
4 |
|
(866 |
) |
Merger-related expenses |
|
3,914 |
|
|
— |
|
|
4,656 |
|
— |
|
Other non-interest expense |
|
2,564 |
|
|
2,089 |
|
|
8,769 |
|
9,386 |
|
TOTAL NON-INTEREST EXPENSE |
|
17,576 |
|
|
12,065 |
|
|
54,423 |
|
48,134 |
|
INCOME BEFORE INCOME TAXES |
|
(529 |
) |
|
7,791 |
|
|
15,260 |
|
26,946 |
|
PROVISION FOR (BENEFIT FROM) INCOME TAXES |
|
(236 |
) |
|
1,383 |
|
|
2,632 |
|
4,818 |
|
NET INCOME |
$ |
(293 |
) |
|
6,408 |
|
|
12,628 |
|
22,128 |
|
|
|
|
|
|
|
|
|
||||
Earnings per common share: |
|
|
|
|
|
|
|
||||
Basic |
$ |
(0.02 |
) |
|
0.57 |
|
|
1.10 |
|
1.93 |
|
Diluted |
$ |
(0.02 |
) |
|
0.57 |
|
|
1.10 |
|
1.93 |
|
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
||||
Basic |
|
12,378,289 |
|
|
11,211,328 |
|
|
11,417,857 |
|
11,410,981 |
|
Diluted |
|
12,378,289 |
|
|
11,211,328 |
|
|
11,417,857 |
|
11,410,981 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240131855898/en/
Company Contact:
President and Chief Executive Officer
(513) 932-1414
shareholderrelations@lcnb.com
Investor and Media Contact:
Managing Director
(216) 464-6400
andrew@smberger.com
Source: