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) April 16, 2007

Lakeland Financial Corporation

(Exact name of Registrant as specified in its charter)

Indiana	0-11487	35-1559596
(State or other jurisdiction	(Commission File Number)	(IRS Employer
Of incorporation)		Identification No.)

202 East Center Street, P.O. Box 1387, Warsaw, Indiana 46581-1387

(Address of principal executive offices) (Zip Code)

(574) 267-6144

(Registrant’s telephone number, including area code)

Not Applicable

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

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 Solicitation 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

On April 16, 2007, Lakeland Financial Corporation issued a press release announcing its earnings for the three-months ended March 31, 2007. The news release is attached as Exhibit 99.1.

Item 9.01. Financial Statements and Exhibits

(c) Exhibits

99.1 Press Release dated April 16, 2007

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.

LAKELAND FINANCIAL CORPORATION

Dated: April 16, 2007 By: /s/David M. Findlay

David M. Findlay

Chief Financial Officer

EX-99

Exhibit 99.1

FOR IMMEDIATE RELEASE Contact: David M. Findlay

Executive Vice President-

Administration and

Chief Financial Officer

(574) 267-9197

LAKE CITY BANK CONTINUES EARNINGS GROWTH

Dividend Increase of 12% Announced

Warsaw, Indiana (April 16, 2007) –Lakeland Financial Corporation (Nasdaq Global Select/LKFN), parent company of Lake City Bank, reported net income of $4.8 million for the first quarter of 2007. Net income increased 2% over the $4.7 million reported for the comparable quarter of 2006. Diluted net income per share for the first quarters of 2007 and 2006 was $0.38.

The Company also announced that the Board of Directors approved a cash dividend for the first quarter of $0.14 per share, payable on May 7, 2007 to shareholders of record as of April 25, 2007. The quarterly dividend represents a 12% increase over the quarterly dividends paid in 2006.

Michael L. Kubacki, Chairman, President and Chief Executive Officer, commented, “Our loan growth of $24 million during the first quarter will provide a good base for 2007’s expected overall growth. We have further enhanced our position as the bank for business during the quarter with expanded penetration in all of our existing markets. In addition, we are establishing strong contacts and building a relationship base for future expansion in the Indianapolis market, which we entered in late 2006.”

Average total loans for the first quarter of 2007 were $1.35 billion versus $1.21 billion during the first quarter of 2006, an increase of 12%. Total gross loans as of March 31, 2007 were $1.38 billion, an increase of $24.1 million, versus $1.35 billion as of December 31, 2006. Total loans as of March 31, 2006 were $1.23 billion.

Kubacki added, “We are pleased that our net interest margin was essentially unchanged from the fourth quarter of 2006. Net interest margin compression is an industry-wide challenge and we’re pleased that our focus on managing the bank’s cost of funds has contributed to a stable net interest margin. With no foreseeable change to the interest rate environment, we will maintain our drive to generate incremental fee income while at the same time keeping a tight expense control environment.”

Lakeland Financial’s allowance for loan losses as of March 31, 2007 was $14.8 million, compared to $14.5 million as of December 31, 2006 and $13.2 million as of March 31, 2006. Nonperforming assets totaled $13.9 million as of March 31, 2007 versus $14.2 million as of December 31, 2006 and $7.0 million on March 31, 2006. The ratio of nonperforming assets to loans was 1.01% on March 31, 2007 compared to 1.05% at December 31, 2006 and 0.58% at March 31, 2006. The increase in nonperforming assets from the first quarter of 2006 resulted from the addition of a single borrowing relationship. The borrower is engaged in real estate development in Northern Indiana. Borrower collateral, including real estate, and personal guarantees of its principals support this credit, although there can be no assurances that full repayment of the loans will result.

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Net charge offs totaled $346,000 in the first quarter of 2007, versus $867,000 during the fourth quarter of 2006. Net recoveries were $9,000 in the first quarter of 2006.

For the three months ended March 31, 2007, Lakeland Financial’s average equity to average assets ratio was 7.45% compared to 7.30% for the fourth quarter of 2006 and 7.16% for the first quarter of 2006. Average stockholders' equity for the quarter ended March 31, 2007 was $131.9 million versus $128.9 million for the fourth quarter of 2006 and $116.0 million for the first quarter of 2006. Average total deposits were $1.45 billion for the first quarter of 2007, versus $1.46 billion for the fourth quarter of 2006 and $1.28 billion for the first quarter of 2006.

Lakeland Financial Corporation is a $1.8 billion bank holding company headquartered in Warsaw, Indiana. Lake City Bank serves Northern Indiana with 43 branches located in the following Indiana counties: Kosciusko, Elkhart, Allen, St. Joseph, DeKalb, Fulton, Huntington, LaGrange, Marshall, Noble, Pulaski and Whitley. The Company also has a Loan Production Office in Indianapolis, Indiana.

In addition to the results presented in accordance with generally accepted accounting principles in the United States of America, this press release contains certain non-GAAP financial measures. Lakeland Financial believes that providing non-GAAP financial measures provides investors with information useful to understanding Lakeland Financial’s financial performance. Additionally, these non-GAAP measures are used by management for planning and forecasting purposes, including measures based on “tangible equity” which is “common stockholders’ equity” excluding intangible assets, net of deferred tax. A reconciliation of these non-GAAP measures to the most comparable GAAP equivalent is included in the attached financial tables where the non-GAAP measure is presented.

Lakeland Financial Corporation may be accessed on its home page at www.lakecitybank.com. The Company’s common stock is traded on the Nasdaq Global Select Market under “LKFN”. Market makers in Lakeland Financial Corporation common shares include Automated Trading Desk Financial Services, LLC, B-Trade Services, LLC, Citadel Derivatives Group, LLC, Citigroup Global Market Holdings, Inc., E*TRADE Capital Markets LLC, FTN Financial Securities Corp., FTN Midwest Securities Corp., Goldman Sachs & Company, Howe Barnes Hoefer & Arnett, Inc., Keefe, Bruyette & Woods, Inc., Knight Equity Markets, L.P., Lehman Brothers Inc., Morgan Stanley & Co., Inc., Stifel Nicolaus & Company, Inc., Susquehanna Capital Group and UBS Securities LLC.

This document contains, and future oral and written statements of the Company and its management may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the

use of words such as “believe,” “expect,” “anticipate,” “plan,” “intend,” “estimate,” “may,” “will,” “would,” “could,” “should” or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events. Additional information concerning the Company and its business, including factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission, including the Company’s Annual Report on form 10-K.

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LAKELAND FINANCIAL CORPORATION

FIRST QUARTER 2007 FINANCIAL HIGHLIGHTS

(Unaudited – Dollars in thousands except share and Per Share Data)

	Three Months Ended
	Mar. 31,		Dec. 31,		Mar. 31,
	2007		2006		2006
END OF PERIOD BALANCES
Assets	$ 1,818,260		$ 1,836,706		$ 1,644,143
Deposits	1,498,002		1,475,765		1,319,745
Loans	1,377,926		1,353,837		1,225,179
Allowance for Loan Losses	14,758		14,463		13,236
Common Stockholders’ Equity	134,944		130,187		117,330
Tangible Equity	130,003		125,149		112,027
AVERAGE BALANCES
Assets
Total Assets	$ 1,771,551		$ 1,764,427		$ 1,620,670
Earning Assets	1,664,938		1,653,882		1,504,381
Investments	295,706		298,780		291,635
Loans	1,353,378		1,332,145		1,205,849
Liabilities and Stockholders’ Equity
Total Deposits	1,454,083		1,463,519		1,275,089
Interest Bearing Deposits	1,237,542		1,243,308		1,058,234
Interest Bearing Liabilities	1,408,401		1,401,715		1,275,129
Common Stockholders’ Equity	131,907		128,852		116,006
INCOME STATEMENT DATA
Net Interest Income	$      13,098		$      13,341		$      12,860
Net Interest Income-Fully Tax Equivalent	13,349		13,611		13,153
Provision for Loan Losses	641		1,042		453
Noninterest Income	4,461		4,451		4,398
Noninterest Expense	10,128		10,171		9,750
Net Income	4,758		4,559		4,650
PER SHARE DATA
Basic Net Income Per Common Share	$          0.39		$          0.38		$          0.39
Diluted Net Income Per Common Share	0.38		0.37		0.38
Cash Dividends Declared Per Common Share	0.125		0.125		(1)
Book Value Per Common Share (equity per share issued)	11.07		10.74		9.74
Market Value – High	25.92		26.40		23.38
Market Value – Low	21.85		23.47		19.90
Basic Weighted Average Common Shares Outstanding	12,159,768		12,112,734		12,013,830
Diluted Weighted Average Common Shares Outstanding	12,419,975		12,404,791		12,340,770
KEY RATIOS
Return on Average Assets	1.09	%	1.03	%	1.16	%
Return on Average Common Stockholders’ Equity	14.63		14.04		16.26
Efficiency (Noninterest Expense / Net Interest Income
plus Noninterest Income)	57.68		57.11		56.49
Average Equity to Average Assets	7.45		7.30		7.16
Net Interest Margin	3.25		3.27		3.54
Net Charge Offs to Average Loans	0.10		0.26		0
Loan Loss Reserve to Loans	1.07		1.07		1.08
Nonperforming Assets to Loans	1.01		1.05		0.58
Tier 1 Leverage	9.07		8.87		9.01
Tier 1 Risk-Based Capital	10.97		10.76		11.05
Total Capital	11.98		11.76		12.05
ASSET QUALITY
Loans Past Due 90 Days or More	$           334		$           299		$           117
Non-accrual Loans	13,438		13,820		6,926
Net Charge Offs/(Recoveries)	346		867		(9)
Other Real Estate Owned	71		71		0
Other Nonperforming Assets	35		35		6
Total Nonperforming Assets	13,878		14,225		7,049

(1) Cash dividend of $0.125 declared on April 11, 2006.

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LAKELAND FINANCIAL CORPORATION

CONSOLIDATED BALANCE SHEETS

As of March 31, 2007 and December 31, 2006

(in thousands)

	March31,	December 31,
	2007	2006
	(Unaudited)
ASSETS
Cash and due from banks	$73,284	$                65,252
Short-term investments	3,378	54,447
Total cash and cash equivalents	76,662	119,699
Securities available for sale (carried at fair value)	298,269	296,191
Real estate mortgage loans held for sale	1,104	2,175
Loans, net of allowance for loan losses of $14,758 and $14,463	1,363,168	1,339,374
Land, premises and equipment, net	25,410	25,177
Bank owned life insurance	20,853	20,570
Accrued income receivable	8,299	8,720
Goodwill	4,970	4,970
Other intangible assets	774	825
Other assets	18,751	19,005
Total assets	$1,818,260	$           1,836,706
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Noninterest bearing deposits	$253,953	$              258,472
Interest bearing deposits	1,244,049	1,217,293
Total deposits	1,498,002	1,475,765
Short-term borrowings
Federal funds purchased	21,500	0
Securities sold under agreements to repurchase	117,985	106,670
U.S. Treasury demand notes	0	814
Other short-term borrowings	0	80,000
Total short-term borrowings	139,485	187,484
Accrued expenses payable	14,531	11,959
Other liabilities	326	338
Long-term borrowings	44	45
Subordinated debentures	30,928	30,928
Total liabilities	1,683,316	1,706,519
STOCKHOLDERS' EQUITY
Common stock: 180,000,000 shares authorized, no par value
12,186,148 shares issued and 12,094,816 outstanding as of March 31, 2007
12,117,808 shares issued and 12,031,023 outstanding as of December 31, 2006	1,453	1,453
Additional paid-in capital	17,553	16,525
Retained earnings	119,758	116,516
Accumulated other comprehensive loss	(2,578)	(3,178)
Treasury stock, at cost (2007 - 91,332 shares, 2006 - 86,785 shares)	(1,242)	(1,129)
Total stockholders' equity	134,944	130,187
Total liabilities and stockholders' equity	$1,818,260	$           1,836,706

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LAKELAND FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

For the Three Months Ended March 31, 2007 and 2006

(in thousands except for share data)

(unaudited)

	ThreeMonthsEnded
	March31,
	2007	2006
NET INTEREST INCOME
Interest and fees on loans
Taxable	$24,720	$        20,674
Tax exempt	50	58
Interest and dividends on securities
Taxable	2,678	2,561
Tax exempt	602	607
Interest on short-term investments	208	73
Total interest income	28,258	23,973
Interest on deposits	13,098	8,724
Interest on borrowings
Short-term	1,430	1,802
Long-term	632	587
Total interest expense	15,160	11,113
NET INTEREST INCOME	13,098	12,860
Provision for loan losses	641	453
NET INTEREST INCOME AFTER PROVISION FOR
LOAN LOSSES	12,457	12,407
NONINTEREST INCOME
Wealth advisory and investment brokerage fees	932	905
Service charges on deposit accounts	1,632	1,673
Loan, insurance and service fees	581	573
Merchant card fee income	622	580
Other income	493	513
Net gains on sales of real estate mortgage loans held for sale	165	152
Net securities gains (losses)	36	2
Total noninterest income	4,461	4,398
NONINTEREST EXPENSE
Salaries and employee benefits	5,855	5,489
Net occupancy expense	674	609
Equipment costs	445	455
Data processing fees and supplies	659	550
Credit card interchange	389	358
Other expense	2,106	2,289
Total noninterest expense	10,128	9,750
INCOME BEFORE INCOME TAX EXPENSE	6,790	7,055
Income tax expense	2,032	2,405
NET INCOME	$4,758	$          4,650
BASIC WEIGHTED AVERAGE COMMON SHARES	12,159,768	12,013,830
BASIC EARNINGS PER COMMON SHARE	$0.39	$            0.39
DILUTED WEIGHTED AVERAGE COMMON SHARES	12,419,975	12,340,770
DILUTED EARNINGS PER COMMON SHARE	$0.38	$            0.38

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