EX-99.2 3 exhibit9922015qr2.htm EXHIBIT 99.2 Exhibit 99.2 2015Qr2


Exhibit 99.2

LCNB Corp. and Subsidiaries
Financial Highlights
(Dollars in thousands, except per share amounts)
(Unaudited)
 
Three Months Ended
 
Six Months Ended
 
6/30/2015
 
3/31/2015
 
12/31/2014
 
9/30/2014
 
6/30/2014
 
6/30/2015
 
6/30/2014
Condensed Income Statement
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest income
$
11,348

 
$
10,090

 
10,367

 
9,906

 
9,926

 
21,438

 
19,204

Interest expense
748

 
762

 
844

 
911

 
920

 
1,510

 
1,835

Net interest income
10,600

 
9,328

 
9,523

 
8,995

 
9,006

 
19,928

 
17,369

Provision for loan losses
677

 
69

 
193

 
401

 
255

 
746

 
336

Net interest income after provision
9,923

 
9,259

 
9,330

 
8,594

 
8,751

 
19,182

 
17,033

Non-interest income
2,831

 
2,306

 
2,449

 
2,315

 
2,301

 
5,137

 
4,378

Non-interest expense
8,426

 
7,649

 
7,334

 
7,238

 
7,600

 
16,075

 
16,272

Income before income taxes
4,328

 
3,916

 
4,445

 
3,671

 
3,452

 
8,244

 
5,139

Provision for income taxes
1,205

 
1,082

 
1,228

 
953

 
841

 
2,287

 
1,205

Net income
$
3,123

 
2,834

 
3,217

 
2,718

 
2,611

 
5,957

 
3,934

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Per Share Data
 
 
 
 
 
 
 
 
 
 
 
 
 
Dividends per share
$
0.16

 
0.16

 
0.16

 
0.16

 
0.16

 
0.32

 
0.32

Basic earnings per share
$
0.33

 
0.30

 
0.34

 
0.30

 
0.28

 
0.63

 
0.42

Diluted earnings per share
$
0.32

 
0.30

 
0.34

 
0.29

 
0.28

 
0.62

 
0.42

Book value per share
$
13.91

 
13.80

 
13.50

 
13.24

 
13.18

 
13.91

 
13.18

Tangible book value per share
$
10.33

 
10.40

 
10.08

 
9.80

 
9.73

 
10.33

 
9.73

Average basic shares outstanding
9,694,732

 
9,312,636

 
9,306,382

 
9,299,691

 
9,293,382

 
9,504,739

 
9,290,905

Average diluted shares outstanding
9,804,728

 
9,410,774

 
9,403,013

 
9,405,013

 
9,402,343

 
9,609,050

 
9,407,964

Shares outstanding at period end
9,896,904

 
9,317,583

 
9,311,318

 
9,305,208

 
9,298,270

 
9,896,904

 
9,298,270

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Selected Financial Ratios
 
 
 
 
 
 
 
 
 
 
 
 
 
Return on average assets
1.03
%
 
1.02
%
 
1.14
%
 
0.95
%
 
0.91
%
 
1.02
%
 
0.72
%
Return on average equity
9.21
%
 
9.01
%
 
10.18
%
 
8.71
%
 
8.60
%
 
9.11
%
 
6.57
%
Dividend payout ratio
48.48
%
 
53.33
%
 
47.06
%
 
53.33
%
 
57.14
%
 
50.79
%
 
76.19
%
Net interest margin (tax equivalent)
3.95
%
 
3.83
%
 
3.82
%
 
3.57
%
 
3.59
%
 
3.89
%
 
3.62
%
Efficiency ratio (tax equivalent)
61.08
%
 
63.90
%
 
59.48
%
 
61.97
%
 
65.26
%
 
62.39
%
 
72.58
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Selected Balance Sheet Items
 
 
 
 
 
 
 
 
 
 
 
 
 
Investment securities and stock
$
378,651

 
329,429

 
314,074

 
322,341

 
357,567

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
47,958

 
36,447

 
35,424

 
34,997

 
38,919

 
 
 
 
Commercial, secured by real estate
399,551

 
381,371

 
379,141

 
371,533

 
377,806

 
 
 
 
Residential real estate
273,249

 
255,926

 
254,087

 
248,113

 
243,966

 
 
 
 
Consumer
19,718

 
17,296

 
18,006

 
19,305

 
20,015

 
 
 
 
  Agricultural
13,434

 
9,816

 
11,472

 
9,249

 
8,466

 
 
 
 
Other, including deposit overdrafts
638

 
678

 
680

 
2,651

 
2,594

 
 
 
 
Deferred net origination costs (fees)
188

 
151

 
146

 
67

 
(47
)
 
 
 
 
  Loans, gross
754,736

 
701,685

 
698,956

 
685,915

 
691,719

 
 
 
 
Less allowance for loan losses
2,879

 
2,837

 
3,121

 
3,298

 
3,394

 
 
 
 
  Loans, net
$
751,857

 
698,848

 
695,835

 
682,617

 
688,325

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets
$
1,249,363

 
1,129,497

 
1,108,066

 
1,123,356

 
1,151,109

 
 
 
 
Total deposits
1,084,033

 
973,725

 
946,205

 
956,633

 
986,824

 
 
 
 
Short-term borrowings
12,731

 
13,454

 
16,645

 
24,954

 
23,523

 
 
 
 
Long-term debt
6,085

 
6,153

 
11,357

 
11,432

 
11,506

 
 
 
 
Total shareholders’ equity
137,698

 
128,576

 
125,695

 
123,179

 
122,584

 
 
 
 





 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Six Months Ended
 
6/30/2015
 
3/31/2015
 
12/31/2014
 
9/30/2014
 
6/30/2014
 
6/30/2015
 
6/30/2014
Selected Balance Sheet Items, continued
 
 
 
 
 
 
 
 
 
 
 
 
Tangible common equity (TCE)
$
101,694

 
96,340

 
93,277

 
90,579

 
89,800

 
 
 
 
Tangible common assets (TCA)
1,213,359

 
1,097,261

 
1,075,648

 
1,090,756

 
1,118,325

 
 
 
 
TCE/TA
8.38
%
 
8.78
%
 
8.67
%
 
8.30
%
 
8.03
%
 
 
 
 
Loans to deposit ratio
69.62
%
 
72.06
%
 
73.87
%
 
71.70
%
 
70.10
%
 
 
 
 
Equity to assets ratio
11.02
%
 
11.38
%
 
11.34
%
 
10.97
%
 
10.65
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Selected Average Balance Sheet Items
 
 
 
 
 
 
 
 
 
 
 
 
Investment securities and stock
$
360,750

 
313,279

 
311,395

 
348,469

 
347,837

 
337,146

 
325,438

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans
$
737,021

 
699,959

 
694,185

 
688,972

 
685,581

 
718,592

 
666,663

Less allowance for loan losses
2,865

 
2,870

 
3,075

 
3,288

 
3,367

 
2,868

 
3,369

Net loans
$
734,156

 
697,089

 
691,110

 
685,684

 
682,214

 
715,724

 
663,294

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets
$
1,220,938

 
1,125,326

 
1,123,949

 
1,140,922

 
1,145,300

 
1,173,307

 
1,108,454

Total deposits
1,057,818

 
969,658

 
967,505

 
976,109

 
991,809

 
1,013,982

 
957,123

Short-term borrowings
12,803

 
13,824

 
12,217

 
22,547

 
13,601

 
13,310

 
12,215

Long-term debt
6,108

 
6,598

 
11,382

 
11,457

 
11,531

 
6,352

 
11,675

Total shareholders’ equity
136,003

 
127,608

 
125,302

 
123,807

 
121,725

 
131,829

 
120,847

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Asset Quality
 
 
 
 
 
 
 
 
 
 
 
 
 
Net charge-offs
$
636

 
352

 
370

 
496

 
232

 
 
 
 
Other real estate owned
1,364

 
1,364

 
1,370

 
1,460

 
1,906

 
 
 
 
Non-accrual loans
1,961

 
3,972

 
5,599

 
6,264

 
6,243

 
 
 
 
Loans past due 90 days or more and still accruing
128

 
355

 
203

 
111

 
130

 
 
 
 
Total nonperforming loans
$
2,089

 
4,327

 
5,802

 
6,375

 
6,373

 


 
 
Net charge-offs to average loans
0.35
%
 
0.20
%
 
0.21
%
 
0.29
%
 
0.14
%
 
 
 
 
Allowance for loan losses to total loans
0.38
%
 
0.40
%
 
0.45
%
 
0.48
%
 
0.49
%
 



 
Nonperforming loans to total loans
0.28
%
 
0.62
%
 
0.83
%
 
0.93
%
 
0.92
%
 



 
Nonperforming assets to total assets
0.28
%
 
0.50
%
 
0.65
%
 
0.70
%
 
0.72
%
 



 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Assets Under Management
 
 
 
 
 
 
 
 
 
 
 
 
 
LCNB Corp. total assets
$
1,249,363

 
1,129,497

 
1,108,066

 
1,123,356

 
1,151,109

 
 
 
 
Trust and investments (fair value)
272,209

 
264,122

 
258,266

 
255,409

 
267,857

 
 
 
 
Mortgage loans serviced
117,204

 
116,534

 
120,433

 
123,792

 
128,855

 
 
 
 
Business cash management
6,628

 
5,839

 
5,811

 
5,846

 
6,307

 
 
 
 
Brokerage accounts (fair value)
144,186

 
141,439

 
132,823

 
127,303

 
126,069

 
 
 
 
Total assets managed
$
1,789,590

 
1,657,431

 
1,625,399

 
1,635,706

 
1,680,197

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-GAAP Financial Measures
 
 
 
 
 
 
 
 
 
 
 
 
 
Accreted income on acquired loans
$
1,348

 
326

 
442

 
375

 
361

 
1,674

 
736

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
$
3,123

 
2,834

 
3,217

 
2,718

 
2,611

 
5,957

 
3,934

Less (add) net gain (loss) on sales of securities, net of tax
146

 
73

 
37

 
64

 
0

 
219

 
(3
)
Add merger-related expenses, net of tax
363

 
50

 
26

 
3

 
46

 
429

 
899

Core net income
$
3,340

 
2,811

 
3,206

 
2,657

 
2,657

 
6,167

 
4,836

Basic core earnings per share
$
0.34

 
0.30

 
0.34

 
0.29

 
0.29

 
0.65

 
0.52

Diluted core earnings per share
$
0.34

 
0.30

 
0.34

 
0.28

 
0.28

 
0.64

 
0.51

Adjusted return on average assets
1.10
%
 
1.01
%
 
1.13
%
 
0.92
%
 
0.93
%
 
1.06
%
 
0.88
%
Adjusted return on average equity
9.85
%
 
8.86
%
 
10.06
%
 
8.44
%
 
8.67
%
 
9.43
%
 
8.02
%
Core efficiency ratio (tax equivalent)
58.23
%
 
63.91
%
 
59.48
%
 
62.46
%
 
64.66
%
 
60.88
%
 
66.50
%





LCNB CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)
 
 
June 30, 2015 (Unaudited)
 
December 31, 2014
ASSETS:
 
 
 
 
Cash and due from banks
 
$
21,195

 
14,235

Interest-bearing demand deposits
 
6,718

 
1,610

Total cash and cash equivalents
 
27,913

 
15,845

Investment securities:
 
 

 
 

Available-for-sale, at fair value
 
347,860

 
285,365

Held-to-maturity, at cost
 
24,677

 
22,725

Federal Reserve Bank stock, at cost
 
2,476

 
2,346

Federal Home Loan Bank stock, at cost
 
3,638

 
3,638

Loans, net
 
751,857

 
695,835

Premises and equipment, net
 
22,591

 
20,733

Goodwill
 
30,187

 
27,638

Core deposit and other intangibles
 
5,817

 
4,780

Bank owned life insurance
 
22,250

 
21,936

Other assets
 
10,097

 
7,225

TOTAL ASSETS
 
$
1,249,363

 
1,108,066

LIABILITIES:
 
 

 
 

Deposits:
 
 

 
 

Noninterest-bearing
 
$
228,743

 
213,303

Interest-bearing
 
855,290

 
732,902

Total deposits
 
1,084,033

 
946,205

Short-term borrowings
 
12,731

 
16,645

Long-term debt
 
6,085

 
11,357

Accrued interest and other liabilities
 
8,816

 
8,164

TOTAL LIABILITIES
 
1,111,665

 
982,371

SHAREHOLDERS' EQUITY:
 
 

 
 

Preferred shares – no par value, authorized 1,000,000 shares, none outstanding
 

 

Common shares – no par value, authorized 12,000,000 shares, issued 10,650,531 and 10,064,945 shares at June 30, 2015 and December 31, 2014, respectively
 
76,607

 
67,181

Retained earnings
 
72,281

 
69,394

Treasury shares at cost, 753,627 shares at June 30, 2015 and December 31, 2014
 
(11,665
)
 
(11,665
)
Accumulated other comprehensive loss, net of taxes
 
475

 
785

TOTAL SHAREHOLDERS' EQUITY
 
137,698

 
125,695

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
 
$
1,249,363

 
1,108,066










LCNB CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
(Unaudited)
 
Three Months Ended 
 June 30,
 
Six Months Ended 
 June 30,
 
2015
 
2014
 
2015
 
2014
INTEREST INCOME:
 
 
 
 
 
 
 
Interest and fees on loans
$
9,492

 
8,144

 
18,032

 
15,840

Interest on investment securities –
 
 
 

 
 

 
 

Taxable
1,033

 
1,026

 
1,889

 
1,917

Non-taxable
702

 
657

 
1,355

 
1,303

Other short-term investments
121

 
99

 
162

 
144

TOTAL INTEREST INCOME
11,348

 
9,926

 
21,438

 
19,204

INTEREST EXPENSE:
 

 
 

 
 

 
 

Interest on deposits
671

 
814

 
1,353

 
1,623

Interest on short-term borrowings
4

 
5

 
8

 
8

Interest on long-term debt
73

 
101

 
149

 
204

TOTAL INTEREST EXPENSE
748

 
920

 
1,510

 
1,835

NET INTEREST INCOME
10,600

 
9,006

 
19,928

 
17,369

PROVISION FOR LOAN LOSSES
677

 
255

 
746

 
336

NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES
9,923

 
8,751

 
19,182

 
17,033

NON-INTEREST INCOME:
 

 
 

 
 

 
 

Trust income
852

 
728

 
1,652

 
1,383

Service charges and fees on deposit accounts
1,234

 
1,252

 
2,341

 
2,374

Net gain (loss) on sales of securities
221

 

 
332

 
(4
)
Bank owned life insurance income
155

 
170

 
314

 
342

Gains from sales of mortgage loans
219

 
53

 
254

 
68

Other operating income
150

 
98

 
244

 
215

TOTAL NON-INTEREST INCOME
2,831

 
2,301

 
5,137

 
4,378

NON-INTEREST EXPENSE:
 

 
 

 
 

 
 

Salaries and employee benefits
4,381

 
3,956

 
8,671

 
7,874

Equipment expenses
302

 
345

 
590

 
639

Occupancy expense, net
584

 
514

 
1,179

 
1,165

State franchise tax
250

 
239

 
502

 
483

Marketing
220

 
197

 
383

 
329

Amortization of intangibles
175

 
148

 
321

 
274

FDIC insurance premiums
145

 
160

 
296

 
309

Merger-related expenses
522

 
70

 
592

 
1,362

Other non-interest expense
1,847

 
1,971

 
3,541

 
3,837

TOTAL NON-INTEREST EXPENSE
8,426

 
7,600

 
16,075

 
16,272

INCOME BEFORE INCOME TAXES
4,328

 
3,452

 
8,244

 
5,139

PROVISION FOR INCOME TAXES
1,205

 
841

 
2,287

 
1,205

NET INCOME
$
3,123

 
2,611

 
5,957

 
3,934

 
 
 
 
 
 
 
 
Dividends declared per common share
$
0.16

 
0.16

 
0.32

 
0.32

Earnings per common share:
 

 
 

 
 

 
 

Basic
$
0.33

 
0.28

 
0.63

 
0.42

Diluted
0.32

 
0.28

 
0.62

 
0.42

Weighted average common shares outstanding:
 
 
 

 
 
 
 

Basic
9,694,732

 
9,293,382

 
9,504,739

 
9,290,905

Diluted
9,804,728

 
9,402,343

 
9,609,050

 
9,407,964