8-K

UNITED STATES
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) April 30, 2010 (April 27, 2010)

Princeton National Bancorp, Inc.

(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of incorporation)

0-20050	36-3210283
(Commission File Number)	(IRS Employer Identification No.)
606 South Main Street Princeton, Illinois	61356
(Address of Principal Mr. Ogaard Offices)	(Zip Code)

Registrant’s telephone number, including area code (815) 875-4444

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

     The following information, including the Exhibit attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934.

     On April 27, 2010, Princeton National Bancorp, Inc. (the “Company”) issued a news release to report its financial results for the quarter ended March 31, 2010. The release is furnished as Exhibit 99.1 hereto.

Item 5.07 Submission of Matters to a Vote of Security Holders.

     On April 27, 2010, the Company held its annual meeting of stockholders. The results of the vote at the meeting were as follows:

1. To elect four directors, each to serve a three-year term:

	For		Withheld		Broker Non-Vote
Sharon L. Covert		1,446,185		210,866		1,108,679
Mark Janko		1,472,844		184,207		1,108,679
Willard Lee		1,447,779		209,272		1,108,679
Stephen W. Samet		1,445,158		211,893		1,108,679

2. To approve the Company’s executive compensation:

For	Against		Abstain		Broker Non-Vote
2,253,916		227,436		65,778		0

3. To ratify the selection of BKD, LLP as independent auditors for 2010:

For	Against		Abstain		Broker Non-Vote
2,423,562		70,787		52,781		0

Item 9.01 Financial Statements and Exhibits

(d) Exhibits:

Exhibit 99.1 April 27, 2010 Press Release

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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 hereunto duly authorized.

PRINCETON NATIONAL BANCORP, INC. (Registrant)
By:	/s/ Thomas D. Ogaard
	Thomas D. Ogaard, President and
	Chief Executive Officer

Dated: April 30, 2010

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EXHIBIT INDEX

Number	Description
99.1	April 27, 2010 Press Release

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EX-99.1

Exhibit 99.1

April 27, 2010

Princeton National Bancorp, Inc. Announces
First Quarter 2010 Results

Princeton National Bancorp, Inc. (NASDAQ: PNBC), the holding company of Citizens First National Bank, announced a net loss available to common stockholders of $62,000 or $0.02 per common share, compared to net income available to common stockholders of $914,000 or $0.28 in the first quarter of 2009.

“The Company’s 2010 first quarter loss available to common stockholders reflects credit-related costs associated with the Company’s continuing efforts to further improve the risk profile of its balance sheet. During the first quarter, the net interest margin improved and core deposits remained strong; however, substantial credit costs continued to exert pressure on the bottom-line. Despite the improvement over our fourth quarter of 2009, we remain unsatisfied with our financial performance and will continue to focus on improving the profitability of the Company,” said Thomas D. Ogaard, President and Chief Executive Officer.

“At the forefront of improving the Company’s profitability, the net interest margin improved to 3.90% for the first quarter from 3.40% for the same period in 2009, driven by an improvement of 81 basis points in the cost of funds or a reduction in interest expense of $1.950 million; the net interest margin is expected to continue to rise throughout 2010,” stated Ogaard.

“In addition to focusing on improving our financial performance, we will continue to strive to eliminate risk from our balance sheet, implement best risk management practices and provide excellent customer service,” Ogaard concluded.

Total assets ended the quarter at $1.200 billion, a decrease of 4.8% from $1.261 billion at December 31, 2009. Princeton National Bancorp, Inc. made a decision to restructure its balance sheet, resulting in a $41.2 million decrease in total loans as of March 31, 2010 in comparison to December 31, 2009 (primarily due to an increase in the number of loan participations, along with seasonal agricultural paydowns).

The non-performing loans of $67.3 million show an increase from $58.6 million at year-end. At the end of the first quarter, specific loss provisions established for individual credits totaled $6.3 million. The Subsidiary Bank staff will continue to work with borrowers to resolve problem loan situations and to work through the challenging remediation cycle for real estate and construction-related credits. Recognizing this, and reflective of current economic conditions, we have increased our level of loan loss provisioning, bringing our level of reserves to 1.94% of total loans, an increase from .76% one year ago. The loan loss provision taken in the first quarter totaled $3,925,000 versus $6,000,000 and $1,170,000 in the fourth and first quarters of 2009, respectively.

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In the fourth quarter of 2009, the subsidiary bank made a decision to reduce its deposit concentration in specific sectors and, as a result, total deposits decreased $44.0 million during the first quarter of 2010.

In the first quarter of 2010, the Company saw the retirement of Tony J. Sorcic as President & CEO, the promotion of Thomas D. Ogaard as President & CEO, and promotion of Todd D. Fanning as Executive Vice President & COO/CFO, and the appointment of Todd D. Fanning to the Board of Directors. In addition, in March of 2010, Daryl Becker and Donald E. Grubb announced their retirement from the Board of Directors of the Company and Subsidiary Bank in April 2010. They have been strong members of the Boards of Directors and their input has been invaluable.

The price of PNBC stock closed at $8.69 on March 31, 2010, compared to $10.81 on December 31, 2009.

For detailed financial information, please refer to the attached March 31, 2010 financial statements for Princeton National Bancorp, Inc. You may also visit our website at www.pnbc-inc.com to obtain financial information, as well as press releases, stock prices and information on the Company.

The Company offers stockholders the opportunity to participate in the Princeton National Bancorp, Inc. Dividend Reinvestment and Stock Purchase Plan, which allows for optional cash contributions to purchase stock. The Company also offers electronic direct deposit of dividends. To obtain information about the stock purchase plan or electronic direct deposit, please contact us at 815-872-6131.

Princeton National Bancorp, Inc. is the parent holding company of Citizens First National Bank, a $1.200 billion community bank with strategic locations in 8 counties in northern Illinois. The Company is well-positioned in the high growth counties of Will, Kendall, Kane, Grundy, DeKalb and LaSalle plus Bureau and Marshall. Communities include: Aurora, DePue, Genoa, Hampshire, Henry, Huntley, Millbrook, Minooka, Newark, Oglesby, Peru, Plainfield, Plano, Princeton, Sandwich, Somonauk and Spring Valley. The Subsidiary Bank, Citizens First National Bank, provides financial services to meet the needs of individuals, businesses and public entities.

This press release contains certain forward-looking statements, including certain plans, expectations, goals, and projections, which are subject to numerous assumptions, risks, and uncertainties. These forward-looking statements are identified by the use of words such as 1) believes, 2) anticipates, 3) estimates, 4) expects, 5) projects or similar words. Actual results could differ materially from those contained or implied by such statements for a variety of factors including: changes in economic conditions; movements in interest rates; competitive pressures on product pricing and services; success and timing of business strategies; the nature, extent, and timing of governmental actions and reforms; and extended disruption of vital infrastructure. The figures included in this press release are unaudited and may vary from the audited results.

Inquiries should be directed to: Lou Ann Birkey, Vice President — Investor Relations,
Princeton National Bancorp, Inc. (815) 875-4444,
E-Mail address: pnbc@citizens1st.com

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CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except share data)

	March 31,
	2010			December 31,
	(unaudited)			2009
ASSETS
Cash and due from banks	$	12,797		$	15,546
Interest-bearing deposits with financial institutions		81,387			55,527
Total cash and cash equivalents		94,184			71,073
Loans held for sale, at lower of cost or market		932			3,296
Investment securities available-for-sale, at fair value		250,459			288,474
Investment securities held-to-maturity, at amortized cost		13,947			12,793
Total investment securities		264,406			301,267
Loans, net of unearned interest		756,836			798,074
Allowance for loan losses		(14,682	)		(12,075	)
Net loans		742,154			785,999
Premises and equipment, net		27,888			28,269
Land held for sale, at lower of cost or market		2,354			2,354
Federal Reserve and Federal Home Loan Bank stock		4,230			4,230
Bank-owned life insurance		22,781			22,540
Interest receivable		7,355			9,267
Intangible assets, net of accumulated amortization		3,143			3,347
Other real estate owned		20,145			17,658
Other assets		10,902			11,430
TOTAL ASSETS	$	1,200,474		$	1,260,730
LIABILITIES
Demand deposits	$	121,863		$	136,026
Interest-bearing demand deposits		377,453			374,624
Savings deposits		72,984			68,292
Time deposits		459,154			496,597
Total deposits		1,031,454			1,075,539
Customer repurchase agreements		39,082			47,327
Advances from the Federal Home Loan Bank		22,500			31,500
Interest-bearing demand notes issued to the U.S. Treasury		1,514			1,021
Trust Preferred securities		25,000			25,000
Total borrowings		88,096			104,848
Other liabilities		4,989			5,683
Total liabilities		1,124,539			1,186,070
STOCKHOLDERS’ EQUITY
Preferred stock		24,958			24,958
Common stock		22,391			22,391
Common stock warrants		150			150
Additional paid-in capital		18,419			18,423
Retained earnings		29,796			29,851
Accumulated other comprehensive income (loss), net of tax		4,093			2,816
Less: Treasury stock		(23,872	)		(23,929	)
Total stockholders’ equity		75,935			74,660
TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY	$	1,200,474		$	1,260,730
CAPITAL STATISTICS (UNAUDITED)
YTD average equity to average assets		6.25	%		7.84	%
Tier 1 leverage capital ratio		7.53	%		7.48	%
Tier 1 risk-based capital ratio		10.70	%		10.25	%
Total risk-based capital ratio		11.96	%		11.50	%
Common book value per share	$	15.40		$	15.03
Closing market price per share	$	8.69		$	10.81
End of period shares outstanding		3,309,710			3,306,369
End of period treasury shares outstanding		1,168,585			1,171,926

CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except share data)

	THREE MONTHS			THREE MONTHS
	ENDED			ENDED
	March 31, 2010			March 31, 2009
	(unaudited)			(unaudited)
INTEREST INCOME
Interest and fees on loans	$	10,585		$	11,059
Interest and dividends on investment securities		2,843			2,931
Interest on interest-bearing time deposits in other banks		32			16
Total Interest Income		13,460			14,006
INTEREST EXPENSE
Interest on deposits		3,372			5,147
Interest on borrowings		605			780
Total Interest Expense		3,977			5,927
Net interest income		9,483			8,079
Provision for loan losses		3,925			1,170
Net interest income after provision		5,558			6,909
NON-INTEREST INCOME
Trust & farm management fees		264			314
Service charges on deposit accounts		891			976
Other service charges		495			446
Gain on sales of securities available-for-sale		642			187
Brokerage fee income		189			198
Mortgage banking income		460			1
Bank-owned life insurance		229			243
Other operating income		22			430
Total Non-Interest Income		3,192			2,795
NON-INTEREST EXPENSE
Salaries and employee benefits		4,412			4,471
Occupancy		700			709
Equipment expense		767			773
Federal insurance assessments		698			697
Intangible assets amortization		204			208
Data processing		312			316
Advertising		176			197
ORE Expenses, net		735			113
Other operating expense		1,282			1,168
Total Non-Interest Expense		9,286			8,652
Income before income taxes		(536	)		1,052
Income tax expense		(795	)		(104	)
Net income		259			1,156
Preferred stock dividends		314			237
Accretion of preferred stock discount		7			5
Net income available to common stockholders		($62	)	$	914
Net income (loss) per share:
BASIC		($0.02	)	$	0.28
DILUTED		($0.02	)	$	0.28
Basic weighted average shares outstanding		3,306,762			3,298,064
Diluted weighted average shares outstanding		3,306,762			3,298,725
PERFORMANCE RATIOS (annualized)
Return on average assets		0.09	%		0.40	%
Return on average equity		1.38	%		5.14	%
Net interest margin (tax-equivalent)		3.90	%		3.40	%
Efficiency ratio (tax-equivalent)		69.26	%		75.29	%
ASSET QUALITY
Net loan charge-offs	$	1,366		$	371
Total non-performing loans	$	67,291		$	33,278
Non-performing loans as a % of total loans		9.08	%		4.30	%