Ended the Third Quarter with a Stable Deposit
Base and a 90.20% Loan-to-Deposit Ratio
Net Loans Increased 5.8% Year-over-Year to a
Record of $1.45 Billion
Asset Quality Remains Excellent with Total
Nonperforming Loans to Total Loans of 0.02% at September 30,
2023
LCNB Wealth Management Assets Up 18.9%
Year-over-Year to $1.10 Billion
Cincinnati Bancorp, Inc. Acquisition Expected
to Close in November 2023
LCNB Corp. ("LCNB") (NASDAQ: LCNB) today announced financial
results for the three and nine months ended September 30, 2023.
Commenting on the financial results, LCNB President and Chief
Executive Officer Eric Meilstrup said, “LCNB achieved another solid
quarter of growth, as total assets increased 4.0% from the same
period a year ago to a record $1.98 billion, primarily due to a
5.8% increase in net loans. Significant competition for deposits
and higher year-over-year levels of borrowings continue to increase
our cost of funds and impact profitability and we expect these
trends to continue over the near term. As we approach the end of
2023, we remain focused on managing non-interest expenses as well
as maintaining excellent asset quality and strong liquidity levels.
I am pleased with the progress our team continues to make in 2023
and their ability to execute our strategic objectives and deliver
solid results. I want to thank our dedicated employees for all
their hard work.”
Mr. Meilstrup continued, “Upon completion of the Cincinnati
Bancorp acquisition, LCNB expects to have approximately $2.3
billion in total assets, $1.7 billion in loans and $1.8 billion in
deposits. In addition, Cincinnati Bancorp expands our presence
throughout the greater Cincinnati market and allows us to enter the
Northern Kentucky market with one branch office. We believe the
acquisition of Cincinnati Bancorp will enhance LCNB’s long-term
profitability by providing our local, community-oriented financial
services to more customers throughout Cincinnati and Northern
Kentucky, leveraging Cincinnati Bancorp’s mortgage platform, and
allowing us to offer Cincinnati Bancorp’s customers more financial
products, including our Wealth Management solutions. We look
forward to completing the acquisition in the coming weeks and
welcoming Cincinnati Bancorp customers, employees, and shareholders
to LCNB.”
Income Statement
Net income for the 2023 third quarter was $4,070,000, compared
to $5,579,000 for the same period last year. Earnings per basic and
diluted share for the 2023 third quarter were $0.37, compared to
$0.49 for the same period last year. Net income for the nine-month
period ended September 30, 2023 was $12,921,000, compared to
$15,720,000 for the same period last year. Earnings per basic and
diluted share for the nine-month period ended September 30, 2023
were $1.16, compared to $1.36 for the same period last year.
Adjusted net income for the 2023 third quarter was $4,309,000,
or $0.40 per diluted share, compared to $5,579,000, or $0.49 per
diluted share, 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 Bancorp, Inc. acquisition.
Adjusted net income for the nine-month period ended September 30,
2023 was $13,507,000, or $1.22 per diluted share, compared to
$15,720,000, or $1.36 per diluted share, in the prior year
period.
Net interest income for the three months ended September 30,
2023 was $13,571,000, compared to $15,444,000 for the comparable
period in 2022. Net interest income for the nine-month period ended
September 30, 2023 was $41,690,000, as compared to $44,834,000 in
the same period last year. Contributing to the variances for both
the three and nine-month periods were increases in the amount of
long and short-term borrowings combined with higher interest
expense associated with the rapid year-over-year increase in the
Effective Federal Funds Rate. An increase in interest income from
loans due to increases in the volume of average loans outstanding
and the average rates earned on these loans partially offset the
borrowings and deposit variances. For the 2023 third quarter,
LCNB’s tax equivalent net interest margin was 3.04%, compared to
3.54% for the same period last year. For the 2023 nine-month
period, LCNB’s tax equivalent net interest margin was 3.20%,
compared to 3.48% for the same period last year.
Non-interest income for the three months ended September 30,
2023 was $3,578,000, compared to $3,581,000 for the same period
last year. For the nine months ended September 30, 2023,
non-interest income increased $146,000, or by 1.4%, to $10,805,000,
compared to $10,659,000 for the same period last year. The increase
in non-interest income for the nine-month period was primarily due
to higher fiduciary income and a decrease in net losses recognized
on equity securities, partially offset by decreased service charges
and fees on deposit accounts and lower gains on sales of loans.
Non-interest expense for the three months ended September 30,
2023 was $106,000 less than the comparable period in 2022 primarily
due to the absence of losses recognized on the sale of a
decommissioned office building during the 2022 quarter, partially
offset by $302,000 in one-time merger-related expenses recognized
during the third quarter. For the nine months ended September 30,
2023, non-interest expense was $778,000 higher than the comparable
period in 2022, partially due to $742,000 in merger-related
expenses, partially offset by gains recognized on the sale of a
decommissioned office building during the second quarter 2023 and
the absence of losses recognized on the sale of two decommissioned
office buildings during the 2022 period. In addition, non-interest
expense for the 2022 nine-month period was lower than it otherwise
would have been because of an $889,000 gain recognized during the
second quarter 2022 from the sale of other real estate owned.
Capital Allocation
During the nine months ended September 30, 2023, LCNB invested
$3.3 million to repurchase 199,913 shares of its outstanding stock
at an average price of $16.47 per share. This equates to
approximately 1.78% of the Company’s outstanding common stock prior
to the repurchase. At September 30, 2023, LCNB had 315,047 shares
remaining under its February 2023 share repurchase program.
For the third quarter ended September 30, 2023, LCNB paid $0.21
per share in dividends, a 5.0% increase from $0.20 per share for
the third quarter last year. Year-to-date, LCNB has paid $0.63 per
share in dividends, compared to $0.60 per share for the nine-month
period last year.
Balance Sheet
Total assets at September 30, 2023 increased 4.0% to a record
$1.98 billion from $1.90 billion at September 30, 2022. Net loans
at September 30, 2023 increased 5.8% to a record $1.45 billion,
compared to $1.37 billion at September 30, 2022.
Total deposits at September 30, 2023 decreased 2.4% to $1.62
billion, compared to $1.66 billion at September 30, 2022. While
LCNB continues to experience greater competition for deposit
accounts, total deposits at September 30, 2023 increased 1.3% from
June 30, 2023.
Assets Under Management
Total assets managed at September 30, 2023 were a record $3.23
billion, compared to $3.03 billion at September 30, 2022. The
year-over-year increase in total assets managed was primarily due
to increases in LCNB Corp. total assets, trust and investments, and
brokerage accounts. Trust and investments and brokerage accounts
increased due to a higher number of new LCNB Wealth Management
customer accounts opened over the past twelve months and an
increase in the fair value of managed assets, partially offset by
decreases in cash management accounts.
Asset Quality
For the 2023 third quarter, LCNB recorded a total net recovery
of credit losses of $114,000, compared to a total net recovery of
credit losses of $157,000 for the 2022 third quarter. For the nine
months ended September 30, 2023, LCNB recorded a total net recovery
of credit losses of $141,000, compared to a total provision for
credit losses of $269,000 for the nine months ended September 30,
2022.
Net charge-offs for the 2023 third quarter were $33,000, or
0.01% of average loans, compared to net charge-offs of $32,000, or
0.01% of average loans, for the same period last year. For the 2023
nine-month period, net charge-offs were $82,000, or 0.01% of
average loans, compared to net charge-offs of $131,000, or 0.01% of
average loans, for the 2022 nine-month period.
Total nonperforming loans, which include non-accrual loans and
loans past due 90 days or more and still accruing interest,
decreased $204,000 from $465,000 or 0.03% of total loans at
September 30, 2022, to $261,000 or 0.02% of total loans at
September 30, 2023. Nonperforming assets to total assets was 0.01%
at September 30, 2023, compared to 0.02% at September 30, 2022.
Merger Agreement With Cincinnati Bancorp, Inc.
LCNB and Cincinnati Bancorp, Inc. (“CNNB”), the holding company
for Cincinnati Federal, a federally chartered stock savings and
loan association, signed a definitive merger agreement on May 18,
2023, whereby LCNB will acquire CNNB in a stock-and-cash
transaction. CNNB operates five full-service branch offices in
Cincinnati, Ohio and Northern Kentucky.
Pursuant to the terms of the merger agreement, which has been
approved by the Board of Directors of each company, CNNB
shareholders had the opportunity to elect to receive either 0.9274
shares of LCNB stock or $17.21 per share in cash for each share of
CNNB common stock owned, subject to 80% of all CNNB shares being
exchanged for LCNB common stock. The transaction is anticipated to
close in November 2023. Closure is subject to customary closing
conditions as described in the merger agreement, including receipt
of certain regulatory approvals.
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. 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.
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, 2022, 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 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;
- 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,
the Consumer 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.
LCNB Corp. and
Subsidiaries
Financial Highlights
(Dollars in thousands, except per
share amounts)
(Unaudited)
Three Months Ended
Nine Months Ended
09-30-2023
06-30-2023
03-31-2023
12-31-2022
09-30-2022
09-30-2023
09-30-2022
Condensed Income
Statement
Interest income
$
19,668
18,703
17,918
17,719
16,704
56,289
48,034
Interest expense
6,097
4,526
3,976
1,511
1,260
14,599
3,200
Net interest income
13,571
14,177
13,942
16,208
15,444
41,690
44,834
Provision for (recovery of) credit
losses
(114
)
30
(57
)
(19
)
(157
)
(141
)
269
Net interest income after provision for
(recovery of) credit losses
13,685
14,147
13,999
16,227
15,601
41,831
44,565
Non-interest income
3,578
3,646
3,581
3,629
3,581
10,805
10,659
Non-interest expense
12,244
12,078
12,525
12,065
12,350
36,847
36,069
Income before income taxes
5,019
5,715
5,055
7,791
6,832
15,789
19,155
Provision for income taxes
949
1,021
898
1,383
1,253
2,868
3,435
Net income
$
4,070
$
4,694
$
4,157
$
6,408
5,579
12,921
15,720
Supplemental
Income Statement Information
Amort/Accret income on acquired loans
$
—
—
75
249
144
75
271
Tax-equivalent net interest income
$
13,617
14,223
13,989
16,257
15,495
41,829
44,985
Per Share
Data
Dividends per share
$
0.21
0.21
0.21
0.21
0.20
0.63
0.60
Basic earnings per common share
$
0.37
0.42
0.37
0.57
0.49
1.16
1.36
Diluted earnings per common share
$
0.37
0.42
0.37
0.57
0.49
1.16
1.36
Book value per share
$
18.10
18.20
18.22
17.82
17.31
18.10
17.31
Tangible book value per share
$
12.72
12.81
12.86
12.48
11.97
12.72
11.97
Weighted average common shares
outstanding:
Basic
11,038,720
11,056,308
11,189,170
11,211,328
11,284,225
11,094,185
11,478,256
Diluted
11,038,720
11,056,308
11,189,170
11,211,328
11,284,225
11,094,185
11,478,256
Shares outstanding at period end
11,123,382
11,116,080
11,202,063
11,259,080
11,293,639
11,123,382
11,293,639
Selected
Financial Ratios
Return on average assets
0.82
%
0.98
%
0.88
%
1.34
%
1.15
%
0.89
%
1.09
%
Return on average equity
7.92
%
9.22
%
8.33
%
12.90
%
10.80
%
8.49
%
9.91
%
Return on average tangible common
equity
11.21
%
13.07
%
11.85
%
18.59
%
15.30
%
12.04
%
13.86
%
Dividend payout ratio
56.76
%
50.00
%
56.76
%
36.84
%
40.82
%
54.31
%
44.12
%
Net interest margin (tax equivalent)
3.04
%
3.28
%
3.28
%
3.77
%
3.54
%
3.20
%
3.48
%
Efficiency ratio (tax equivalent)
71.21
%
67.59
%
71.29
%
60.67
%
64.74
%
70.01
%
64.82
%
Selected Balance
Sheet Items
Cash and cash equivalents
$
43,422
26,020
31,876
22,701
29,460
Debt and equity securities
309,094
314,763
328,194
323,167
325,801
Loans:
Commercial and industrial
$
125,751
127,553
124,240
120,236
114,694
Commercial, secured by real estate
981,787
961,173
932,208
938,022
908,130
Residential real estate
313,286
312,338
303,051
305,575
316,669
Consumer
27,018
29,007
28,611
28,290
29,451
Agricultural
11,278
9,955
7,523
10,054
8,630
Other, including deposit overdrafts
80
69
62
81
52
Deferred net origination fees
(796
)
(844
)
(865
)
(980
)
(937
)
Loans, gross
1,458,404
1,439,251
1,394,830
1,401,278
1,376,689
Less allowance for credit losses on
loans
7,932
7,956
7,858
5,646
5,644
Loans, net
$
1,450,472
$
1,431,295
$
1,386,972
$
1,395,632
$
1,371,045
Three Months Ended
Nine Months Ended
09-30-2023
06-30-2023
03-31-2023
12-31-2022
09-30-2022
09-30-2023
09-30-2022
Selected Balance
Sheet Items, continued
Allowance for Credit Losses on
Loans:
Allowance for credit losses, beginning of
period
$
7,956
7,858
5,646
5,644
5,833
Cumulative change in accounting principle
- ASC 326
—
—
2,196
—
—
Provision for (recovery of) credit
losses
9
131
32
(19
)
(157
)
Losses charged off
(57
)
(49
)
(36
)
(60
)
(53
)
Recoveries
24
16
20
81
21
Allowance for credit losses, end of
period
$
7,932
7,956
7,858
5,646
5,644
Total earning assets
$
1,787,796
1,756,157
1,736,829
1,726,902
$
1,714,196
Total assets
1,981,668
1,950,763
1,924,808
1,919,398
1,904,975
Total deposits
1,616,890
1,596,709
1,603,881
1,604,970
1,657,370
Short-term borrowings
30,000
112,289
76,500
71,455
4,000
Long-term debt
112,641
18,122
18,598
19,072
24,539
Total shareholders’ equity
201,349
202,316
204,072
200,675
195,439
Equity to assets ratio
10.16
%
10.37
%
10.60
%
10.46
%
10.26
%
Loans to deposits ratio
90.20
%
90.14
%
86.97
%
87.31
%
83.06
%
Tangible common equity (TCE)
$
141,508
142,362
144,006
140,498
135,140
Tangible common assets (TCA)
1,921,827
1,890,809
1,864,742
1,859,221
1,844,676
TCE/TCA
7.36
%
7.53
%
7.72
%
7.56
%
7.33
%
Selected Average
Balance Sheet Items
Cash and cash equivalents
$
36,177
30,742
35,712
24,330
$
35,763
$
34,234
$
32,393
Debt and equity securities
313,669
321,537
327,123
323,195
338,299
320,706
339,051
Loans
$
1,451,153
1,405,939
1,389,385
1,383,809
$
1,384,520
$
1,415,719
$
1,379,080
Less allowance for credit losses on
loans
7,958
7,860
7,522
5,647
5,830
7,782
5,623
Net loans
$
1,443,195
1,398,079
1,381,863
1,378,162
$
1,378,690
$
1,407,937
$
1,373,457
Total earning assets
$
1,775,713
1,737,256
1,729,008
1,711,524
1,736,031
1,747,476
1,728,677
Total assets
1,971,269
1,927,956
1,922,031
1,903,626
1,929,155
1,940,591
1,919,804
Total deposits
1,610,508
1,604,346
1,583,857
1,637,201
1,669,932
1,599,668
1,657,401
Short-term borrowings
63,018
79,485
94,591
21,433
5,728
78,916
12,140
Long-term debt
72,550
18,514
18,983
23,855
24,920
36,878
15,907
Total shareholders’ equity
203,967
204,085
202,419
197,014
205,051
203,496
212,064
Equity to assets ratio
10.35
%
10.59
%
10.53
%
10.35
%
10.63
%
10.49
%
11.05
%
Loans to deposits ratio
90.11
%
87.63
%
87.72
%
84.52
%
82.91
%
88.50
%
83.21
%
Asset
Quality
Net charge-offs (recoveries)
$
33
33
16
(21
)
32
82
131
Other real estate owned
—
—
—
—
—
—
—
Non-accrual loans
$
85
451
701
391
465
85
465
Loans past due 90 days or more and still
accruing
176
256
—
39
—
176
—
Total nonperforming loans
$
261
707
701
430
465
261
465
Net charge-offs (recoveries) to average
loans
0.01
%
0.01
%
0.00
%
(0.01
)%
0.01
%
0.01
%
0.01
%
Allowance for credit losses on loans to
total loans
0.54
%
0.55
%
0.56
%
0.40
%
0.41
%
Nonperforming loans to total loans
0.02
%
0.05
%
0.05
%
0.03
%
0.03
%
Nonperforming assets to total assets
0.01
%
0.04
%
0.04
%
0.02
%
0.02
%
Three Months Ended
Nine Months Ended
09-30-2023
06-30-2023
03-31-2023
12-31-2022
09-30-2022
09-30-2023
09-30-2022
Assets Under
Management
LCNB Corp. total assets
$
1,981,668
1,950,763
1,924,808
1,919,398
1,904,975
Trust and investments (fair value)
731,342
744,149
716,578
678,366
611,409
Mortgage loans serviced
146,483
143,093
142,167
148,412
145,317
Cash management
2,445
2,668
1,831
1,925
53,199
Brokerage accounts (fair value)
368,854
384,889
374,066
347,737
314,144
Total assets managed
3,230,792
3,225,562
3,159,450
3,095,838
3,029,044
Reconciliation of
Net Income Less Tax-Effected Merger-Related Costs
Net income
$
4,070
4,694
4,157
6,408
5,579
12,921
15,720
Merger-related costs
302
415
25
—
—
742
—
Tax effect
(63
)
(88
)
(5
)
—
—
(156
)
—
Adjusted net income
$
4,309
5,021
4,177
6,408
5,579
13,507
15,720
Adjusted basic and diluted earnings per
share
$
0.40
0.45
0.37
0.57
0.49
1.22
1.36
Adjusted return on average assets
0.87
%
1.04
%
0.88
%
1.34
%
1.15
%
0.93
%
1.09
%
Adjusted return on average equity
8.38
%
9.87
%
8.37
%
12.90
%
10.79
%
8.87
%
9.91
%
Three Months Ended September
30,
Three Months Ended June
30,
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)
$
1,451,153
17,875
4.89
%
$
1,384,520
15,026
4.31
%
$
1,405,939
16,763
4.78
%
Interest-bearing demand deposits
10,891
152
5.54
%
13,212
80
2.40
%
9,780
144
5.91
%
Federal Reserve Bank stock
4,652
—
—
%
4,652
—
—
%
4,652
140
12.07
%
Federal Home Loan Bank stock
7,007
134
7.59
%
4,369
65
5.90
%
6,713
121
7.23
%
Investment securities:
0
Equity securities
3,382
38
4.46
%
4,387
20
1.81
%
3,386
38
4.50
%
Debt securities, taxable
274,494
1,296
1.87
%
297,001
1,323
1.77
%
282,325
1,323
1.88
%
Debt securities, non-taxable (2)
24,134
219
3.60
%
27,890
241
3.43
%
24,461
220
3.61
%
Total earnings assets
1,775,713
19,714
4.40
%
1,736,031
16,755
3.83
%
1,737,256
18,749
4.33
%
Non-earning assets
203,514
198,954
198,560
Allowance for credit losses
(7,958
)
(5,830
)
(7,860
)
Total assets
$
1,971,269
$
1,929,155
$
1,927,956
Interest-bearing demand and money market
deposits
$
541,487
2,298
1.68
%
$
539,228
422
0.31
%
$
521,422
1,597
1.23
%
Savings deposits
379,515
129
0.13
%
453,420
159
0.14
%
395,367
134
0.14
%
IRA and time certificates
230,030
1,999
3.45
%
168,358
398
0.94
%
215,403
1,604
2.99
%
Short-term borrowings
63,018
830
5.23
%
5,728
71
4.92
%
79,485
1,008
5.09
%
Long-term debt
72,550
841
4.60
%
24,920
210
3.34
%
18,514
183
3.96
%
Total interest-bearing liabilities
1,286,600
6,097
1.88
%
1,191,654
1,260
0.42
%
1,230,191
4,526
1.48
%
Demand deposits
459,476
508,926
472,154
Other liabilities
21,226
23,524
21,526
Equity
203,967
205,051
204,085
Total liabilities and equity
$
1,971,269
$
1,929,155
$
1,927,956
Net interest rate spread (3)
2.52
%
3.41
%
2.85
%
Net interest income and net interest
margin on a taxable-equivalent basis (4)
13,617
3.04
%
15,495
3.54
%
14,223
3.28
%
Ratio of interest-earning assets to
interest-bearing liabilities
138.02
%
145.68
%
141.22
%
(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.
LCNB CORP. AND
SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE
SHEETS
(Dollars in thousands)
September 30, 2023
(Unaudited)
December 31, 2022
ASSETS:
Cash and due from banks
$
23,124
20,244
Interest-bearing demand deposits
20,298
2,457
Total cash and cash equivalents
43,422
22,701
Investment securities:
Equity securities with a readily
determinable fair value, at fair value
1,254
2,273
Equity securities without a readily
determinable fair value, at cost
2,099
2,099
Debt securities, available-for-sale, at
fair value
274,500
289,850
Debt securities, held-to-maturity, at
cost, net
19,006
19,878
Federal Reserve Bank stock, at cost
4,652
4,652
Federal Home Loan Bank stock, at cost
7,583
4,415
Loans, net
1,450,472
1,395,632
Premises and equipment, net
33,288
33,042
Operating lease right-of-use assets
6,093
6,525
Goodwill
59,221
59,221
Core deposit and other intangibles,
net
1,351
1,827
Bank-owned life insurance
45,128
44,298
Interest receivable
8,087
7,482
Other assets, net
25,512
25,503
TOTAL ASSETS
$
1,981,668
1,919,398
LIABILITIES:
Deposits:
Noninterest-bearing
$
453,146
505,824
Interest-bearing
1,163,744
1,099,146
Total deposits
1,616,890
1,604,970
Short-term borrowings
30,000
71,455
Long-term debt
112,641
19,072
Operating lease liabilities
6,317
6,647
Accrued interest and other liabilities
14,471
16,579
TOTAL LIABILITIES
1,780,319
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 14,334,765 and 14,270,550 shares at
September 30, 2023 and December 31, 2022, respectively; outstanding
11,123,382 and 11,259,080 shares at September 30, 2023 and December
31, 2022, respectively
144,865
144,069
Retained earnings
143,211
139,249
Treasury shares at cost, 3,211,383 and
3,011,470 shares at September 30, 2023 and December 31, 2022,
respectively
(56,015
)
(52,689
)
Accumulated other comprehensive loss, net
of taxes
(30,712
)
(29,954
)
TOTAL SHAREHOLDERS' EQUITY
201,349
200,675
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY
$
1,981,668
$
1,919,398
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
September 30,
2023
2022
2023
2022
INTEREST INCOME:
Interest and fees on loans
$
17,875
15,026
50,781
43,360
Dividends on equity securities:
With a readily determinable fair value
9
14
34
40
Without a readily determinable fair
value
29
6
79
16
Interest on debt securities:
Taxable
1,296
1,323
3,962
3,672
Non-taxable
173
190
523
567
Other investments
286
145
910
379
TOTAL INTEREST INCOME
19,668
16,704
56,289
48,034
INTEREST EXPENSE:
Interest on deposits
4,426
979
10,217
2,493
Interest on short-term borrowings
830
71
3,142
320
Interest on long-term debt
841
210
1,240
387
TOTAL INTEREST EXPENSE
6,097
1,260
14,599
3,200
NET INTEREST INCOME
13,571
15,444
41,690
44,834
PROVISION FOR (RECOVERY OF) CREDIT
LOSSES
(114
)
(157
)
(141
)
269
NET INTEREST INCOME AFTER PROVISION FOR
(RECOVERY OF) CREDIT LOSSES
13,685
15,601
41,831
44,565
NON-INTEREST INCOME:
Fiduciary income
1,736
1,513
5,263
4,851
Service charges and fees on deposit
accounts
1,397
1,706
4,324
4,658
Bank-owned life insurance income
282
269
830
803
Gains from sales of loans
29
—
38
188
Other operating income
134
93
350
159
TOTAL NON-INTEREST INCOME
3,578
3,581
10,805
10,659
NON-INTEREST EXPENSE:
Salaries and employee benefits
7,044
7,062
21,454
21,291
Equipment expenses
397
398
1,175
1,234
Occupancy expense, net
805
790
2,367
2,300
State financial institutions tax
396
439
1,189
1,312
Marketing
223
215
735
845
Amortization of intangibles
113
113
336
365
FDIC insurance premiums, net
224
137
663
397
Contracted services
671
613
1,978
1,902
Other real estate owned, net
1
5
3
(874
)
Merger-related expenses
302
—
742
—
Other non-interest expense
2,068
2,578
6,205
7,297
TOTAL NON-INTEREST EXPENSE
12,244
12,350
36,847
36,069
INCOME BEFORE INCOME TAXES
5,019
6,832
15,789
19,155
PROVISION FOR INCOME TAXES
949
1,253
2,868
3,435
NET INCOME
$
4,070
5,579
12,921
15,720
Earnings per common share:
Basic
0.37
0.49
1.16
1.36
Diluted
0.37
0.49
1.16
1.36
Weighted average common shares
outstanding:
Basic
11,038,720
11,284,225
11,094,185
11,478,256
Diluted
11,038,720
11,284,225
11,094,185
11,478,256
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231023855727/en/
Company Contact: Eric J. Meilstrup President and Chief
Executive Officer LCNB National Bank (513) 932-1414
shareholderrelations@lcnb.com
Investor and Media Contact: Andrew M. Berger Managing
Director SM Berger & Company, Inc. (216) 464-6400
andrew@smberger.com
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