8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  January 28, 2011

LCNB CORP.

(Exact name of Registrant as specified in its Charter)

Ohio	0-26121	31-1626393
(State or other jurisdiction of incorporation)	(Commission File No.)	(IRS Employer Identification Number)

2 North Broadway, Lebanon, Ohio	45036
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:   (513) 932-1414

N/A

(Former name or former address, if changed since last report)

Item 2.02   Results of Operations and Financial Condition.

On January 28, 2011, LCNB Corp. issued an earnings release announcing its financial results for the year ended December 31, 2010.  A copy of the earnings release (Exhibit 99.1) and unaudited financial highlights (Exhibit 99.2) are attached and are furnished under this Item 2.02.

Item 8.01   Other Events.

In November 2010, LCNB Corp.’s board of directors decided to sell the insurance agency subsidiary.  While the agency is being marketed, its financial results are reported in the income statement as income from discontinued operations, net of taxes.  

Item 9.01   Financial Statements and Exhibits.

(c)

Exhibits

Exhibit No.

Description

99.1

Press release dated January 28, 2011

99.2

Unaudited Financial Highlights

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

	LCNB CORP.
Date: January 28, 2011	By:  /s/ Robert C. Haines II
		Robert C. Haines II Chief Financial Officer

EX-99

Exhibit 99.1

Press Release

January 28, 2011

LCNB CORP. REPORTS FINANCIAL RESULTS FOR

THE THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2010

LCNB Corp. today announced net income available to common shareholders of $2,420,000 ($0.36 total basic and $0.35 total diluted earnings per common share) and $9,373,000 ($1.40 total basic and $1.39 total diluted earnings per common share) for the three and twelve months ended December 31, 2010, respectively.  This compares to $1,726,000 ($0.27 total basic and $0.26 total diluted earnings per common share) and $6,658,000 ($1.00 total basic and $0.99 total diluted earnings per common share) for the same three and twelve-month periods in 2009.  The increase in net income available to common shareholders for the twelve-month comparative period resulted primarily from increases in net interest income and non-interest income.  In addition, preferred stock dividends and discount accretion reduced net income available to common shareholders for the twelve months ended December 31, 2009 by $1,108,000.  LCNB did not have these costs during 20 10 because the preferred stock was redeemed from the U.S. Department of the Treasury in October 2009.  The increase in net income available to common shareholders for the three-month comparative period resulted primarily from the absence of $594,000 of preferred stock dividends and discount accretion recognized during the 2009 period and an increase in non-interest income.  

Net loan charge-offs for 2010 and 2009 totaled $2,037,000 and $870,000, respectively.  Non-accrual loans and loans past due 90 days or more and still accruing interest totaled $4,061,000 or 0.89% of total loans at December 31, 2010, compared to $3,863,000 or 0.84% of total loans at December 31, 2009.  The provision for loan losses for the three and twelve months ended December 31, 2010 increased $263,000 and $280,000, respectively, over the comparative periods in 2009 due to increased loan delinquencies, increased net charge-offs, and current economic conditions.  Other real estate owned (which includes property acquired through foreclosure or deed-in-lieu of foreclosure and also includes property deemed to be in-substance foreclosed) and other repossessed assets totaled approximately $2,114,000 at December 31, 2010 and $2,470,000 at December 31, 2009.  The reduction was primarily due to valuation write-downs.

Net interest income for the fourth quarter 2010 was $42,000 less than for the comparable 2009 period and $862,000 greater for the twelve-month period in 2010 as compared to 2009.  The increase for the full year is primarily due to a reduction in general market rates.  The decrease in the fourth quarter reflects the continuing tightening of the rate spread between interest earning assets and interest bearing liabilities.  In addition, some higher-rate investment securities were sold during the fourth quarter 2010.  Non-interest income for the three and twelve-month periods in 2010 was $810,000 and $1,681,000 greater than the comparative periods in 2009. The three-month period was greater primarily due to a $722,000 increase in gains from sales of investment securities and a $234,000 increase in gains from sales of mortgage loans resulting from a greater volume of sales during the 2010 period.  The twelve-month period was greater primarily due to death benefits received from bank owned life insurance during the second quarter 2010 and an increase in gains from sales of investment securities.  

Non-interest expense for the three and twelve-months ended December 31, 2010 increased $393,000 and $578,000, respectively, from the comparative periods in 2009.  The increase for the three-month period was primarily due to increases in salaries and employee benefits.  The increase for the annual period was primarily due to increases in salaries and wages and employee benefits and writedowns of other real estate owned properties totaling $389,000.  These increases were largely offset by the absence of an industry-wide FDIC special assessment of $325,000 that LCNB recognized during the second quarter 2009 and the absence of a $722,000 one-time pension plan related charge recognized in the first quarter 2009.

In late 2010, LCNB Corp.’s board of directors resolved to sell the insurance agency subsidiary and therefore its financial results are reported in the income statement as income from discontinued operations, net of taxes.  

On January 24, 2011 the Board of Directors declared a dividend of $0.16 per share, payable March 15, 2011 to shareholders of record on March 1, 2011.

LCNB Corp. is a financial holding company headquartered in Lebanon, Ohio.  Affiliates of LCNB Corp. are LCNB National Bank, with 25 offices located in Warren, Butler, Montgomery, Clinton, Clermont, and Hamilton Counties, Ohio, and Dakin Insurance Agency, Inc.  Additional information about LCNB Corp. and information about products and services offered by LCNB National Bank and Dakin Insurance Agency can be found on the internet at www.lcnb.com and www.dakin-ins.com.

Certain matters disclosed herein may be deemed to be forward-looking statements that involve risks and uncertainties, including regulatory policy changes, interest rate fluctuations, loan demand, loan delinquencies and losses, and other risks.  Actual strategies and results in future time periods may differ materially from those currently expected.  Such forward-looking statements represent management’s judgment as of the current date.  LCNB disclaims any intent or obligation to update such forward-looking statements.  LCNB intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

EX-99

Exhibit 99.2

LCNB Corp. and Subsidiaries

Financial Highlights

(Dollars in thousands, except per share amounts)

Condensed Income Statement		Three Months Ended December 31,		Twelve Months Ended December 31,
		2010	2009	2010	2009
Interest income	$	8,414	8,821	33,989	34,853
Interest expense		1,986	2,351	8,334	10,060
Net interest income		6,428	6,470	25,655	24,793
Provision for loan losses		693	430	1,680	1,400
Net interest income after provision		5,735	6,040	23,975	23,393
Non-interest income		2,704	1,894	8,929	7,248
Non-interest expense		5,309	4,916	21,238	20,660
Income before income taxes		3,130	3,018	11,666	9,981
Provision for income taxes		772	726	2,518	2,271
Net income from continuing operations		2,358	2,292	9,148	7,710
Income from discontinued operations, net of taxes		62	28	225	56
Net income		2,420	2,320	9,373	7,766
Preferred stock dividends and discount accretion		-	594	-	1,108
Net income available to common   shareholders	$	2,420	1,726	9,373	6,658
Dividends per common share	$	0.16	0.16	0.64	0.64
Basic earnings per common share:
Continuing operations		0.35	0.26	1.37	0.99
Discontinued operations		0.01	0.01	0.03	0.01
Diluted earnings per common share:
Continuing operations		0.34	0.25	1.36	0.98
Discontinued operations		0.01	0.01	0.03	0.01
Average basic shares outstanding		6,688,285	6,687,232	6,687,500	6,687,232
Average diluted shares outstanding		6,738,090	6,721,681	6,736,622	6,701,309
Selected Financial Ratios
Return on average assets		1.23%	1.23%	1.22%	1.07%
Return on average equity		13.09%	13.33%	13.36%	10.43%
Dividend payout ratio		44.22%	58.41%	45.66%	64.39%
Net interest margin (tax equivalent)		3.75%	3.99%	3.88%	3.96%

Selected Balance Sheet Items		December 31 2010	December 31, 2009
Investment securities	$	251,053	217,639
Loans		454,991	460,416
Less allowance for loan losses		2,641	2,998
Net loans		452,350	457,418
Total assets		760,134	734,409
Total deposits		638,539	624,179
Short-term borrowings		21,691	14,265
Long-term debt		23,120	24,960
Total shareholders’ equity		70,707	65,615
Shares outstanding at period end		6,689,743	6,687,232
Book value per share	$	10.57	9.81
Equity to assets ratio		9.30%	8.93%
Assets Under Management
LCNB Corp. total assets	$	760,134	734,409
Trust and investments (fair value)		223,545	197,125
Mortgage loans serviced		70,705	57,369
Business cash management		9,591	17,902
Brokerage accounts (fair value)		82,385	72,202
Total assets managed	$	1,146,360	1,079,007