-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BUyq1/1SNrzFOr9bAYx5+5RtkyvgYC+iwWYrY+Ob5xqeXL+ZSHY6iANLHlaiMBxf z502NMKYzNe3AUGPr8D+cw== 0000737210-03-000036.txt : 20030722 0000737210-03-000036.hdr.sgml : 20030722 20030722162643 ACCESSION NUMBER: 0000737210-03-000036 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20030722 ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030722 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LNB BANCORP INC CENTRAL INDEX KEY: 0000737210 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 341406303 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-13203 FILM NUMBER: 03796693 BUSINESS ADDRESS: STREET 1: 457 BROADWAY CITY: LORAIN STATE: OH ZIP: 44052-1769 BUSINESS PHONE: 800-860-1007 8-K 1 lnb072203.txt LNB BANCORP, INC. 8K 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): JULY 22, 2003 LNB Bancorp, Inc. (Exact name of the registrant as specified on its charter) Ohio (State or other jurisdiction of incorporation) 000-13203 34-1406303 (Commission File Number) (I.R.S. Employer Identification No.) 457 Broadway, Lorain, Ohio 44052 - 1769 (Address of principal executive offices) (Zip Code) (440) 244 - 6000 Registrant's telephone number, including area code Not Applicable (Former name, former address and former fiscal year, if changed since last report) 1 ITEM 9. Regulation FD Disclosure The following information is furnished pursuant to Item 9, "Regulation FD Disclosure" and Item 12, "Disclosure of Results of Operations and Financial Condition. On July 22, 2003, LNB Bancorp, Inc. provided its Second Quarter 2003 Report To Shareholders. That report is attached as Exhibit 99.1 and is incorporated By reference. On July 22, 2003, LNB Bancorp, Inc. issued a press release reporting its Financial results and earnings for its first half of 2003, which ended June 30, 2003. A copy of the press release is attached as Exhibit 99.2 and is incorporated by reference. EXHIBIT INDEX (99.1) Second Quarter 2003 Report of LNB Bancorp Inc. to Shareholders (99.2) Press Release of LNB Bancorp, Inc. regarding financial results for the first half of 2003 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. LNB BANCORP, INC. Date: July 22, 2003 By:/s/Mitchell J. Fallis ----------------------------- Mitchell J. Fallis, CPA Vice President and Chief Accounting Officer EX-99 3 lnb072203report.txt LNB BANCORP, INC. SECOND QUARTER 2003 REPORT TO SHAREHOLDERS LNB BANCORP, INC. Exhibit Index Exhibit Number Description ---------------- ------------------------- 99.1 Second Quarter 2003 Report of LNB Bancorp, Inc. to Shareholders 99.2 Press Release of LNB Bancorp, Inc. reporting financial results for the first half of 2003 Exhibit 99.1 MESSAGE TO SHAREHOLDERS It's a pleasure, once again, to report on the progress of LNB Bancorp, Inc., and its subsidiary companies after the first half of 2003. As of June 30, 2003, LNB Bancorp, Inc. achieved growth in earnings, dividends, assets, loans, securities, deposits, and shareholders' equity. All 2002 financial statements and related pre-share amounts have been restated to reflect the adoption of Statement of Financial Accounting Standard (SFAS) No. 147 Acquisitions of Certain Financial Institutions and SFAS No. 142 "Goodwill and Other Intangible Assets" as related to intangibles. Per share amounts have been adjusted to reflect a three-for-two Stock split on March 14, 2003. Earnings have increased 2% for the first half of the year, compared to the same period one year ago. Earnings for the first six months of 2003 reached $4,515,000, up from $4,429,000 during the first half of 2002. Second quarter earnings for 2003 reached $2,324,000 compared with $2,281,000 for the second quarter of 2002. Earnings for 2003 were higher than a year ago because of higher net interest income and lower noninterest income, noninterest expenses and provision for income taxes. Increases in net interest income were supported by commercial and consumer loans growth coupled with decreases in rates paid on interest bearing liabilities. The decrease in noninterest income resulted primarily from decreases in Investment and Trust Services income and gains on sales of securities offset in part by increases in fees and service charges and increases of gains on sales of loans. Decreases in noninterest expenses resulted from decreases in salaries and employee benefits and marketing expenses offset in part by increases in occupancy expense, outside services and furniture and equipment expenses. Basic and diluted earnings per share for the first half of 2003 reached $.68, a 2% increase over the $.67 amount reported for the first half of 2002. Cash dividends declared per share for the first half of 2003 increased 3% or by $.01 to $.34 per share, up from $.33 per share in 2002. Asset growth remains solid. Consolidated assets climbed 8% to $753.1 million at June 30, 2003, up $58.5 million from June 30, 2002. Net loans grew by $27.1 million from one year ago to $520.1 million at June 30, 2003 for a 6% increase. The security portfolio increased to $165.8 million at June 30, 2003, up $19.0 million or 13% from one year ago. Total deposits increased 7% to $591.6 million, up $38.2 million from one year ago. Increases in savings, checkinvest, Market Access, certificates of deposit and checking accounted for the deposit increase. Lorain National Bank's deposits are insured by the Federal Deposit Insurance Corporation (FDIC). Lorain National Bank operates 21 banking centers and 27 ATMs in nine local communities. Total shareholders' equity increased by $4.3 million during the twelve months ended June 30, 2003 for a 7% increase. Total shareholders' equity was $68.6 million or $10.38 per share at June 30, 2003, compared to $64.2 million or $9.70 per share at June 30, 2002. In addition, we are pleased to announce that effective June 30, 2003, LNB Bancorp, Inc. was added for the first time to the Russell 2000 Index. LNB Bancorp Inc.'s split adjusted stock price advanced about 20% and 81% for the six months and three years ended June 30, 2003, respectively. We appreciate and thank you for your continuing support and look forward to addressing you after the completion of our third quarter of operations. /s/Stanley G. Pijor - ----------------------- Stanley G. Pijor CHAIRMAN OF THE BOARD /s/Gary C. Smith - ----------------------- Gary C. Smith PRESIDENT AND CHIEF EXECUTIVE OFFICER Consolidated Balance Sheets (Unaudited) -------------------------- June 30, 2003 2002 - ---------------------------------------------------------------------- ASSETS: Cash and Due from Banks. . . . . . . . . . .$ 27,377,000 $ 28,053,000 Federal Funds Sold and Short-term Investments 3,081,000 3,463,000 Federal Home Loan Bank and Federal Reserve Bank Stock, at Cost . . . . . . . . 3,807,000 3,658,000 Securities Held to Maturity, at Cost . . . . 4,061,000 11,915,000 Securities Available for Sale, at Fair Value 157,925,000 131,224,000 Portfolio Loans. . . . . . . . . . . . . . . 519,758,000 490,653,000 Loans Available for Sale . . . . . . . . . . 7,465,000 8,449,000 Reserve for Loan Losses. . . . . . . . . . . (7,105,000) (6,140,000) --------------------------- NET LOANS. . . . . . . . . . . . . . . . . . 520,118,000 492,962,000 --------------------------- Premises, Equipment and Intangible Assets (net). . . . . . . . . . . . . . . . 13,750,000 14,055,000 Accrued Interest Receivable and Other Assets. . . . . . . . . . . . . . . . 22,966,000 9,234,000 --------------------------- TOTAL ASSETS . . . . . . . . . . . . . . . .$753,085,000 $694,564,000 --------------------------- LIABILITIES AND STOCKHOLDERS' EQUITY: Noninterest-Bearing Deposits . . . . . . . .$ 99,146,000 $ 84,362,000 Interest-Bearing Deposits. . . . . . . . . . 492,484,000 469,148,000 --------------------------- TOTAL DEPOSITS . . . . . . . . . . . . . . . 591,630,000 553,511,000 --------------------------- Securities Sold under Repurchase Agreements and Other Short-term Borrowings . . . . . . 17,080,000 21,633,000 Federal Home Loan Bank Advances. . . . . . . 69,425,000 48,875,000 Accrued Interest, Taxes, Expenses and Other Liabilities . . . . . . . . . . . . . 6,359,000 6,268,000 --------------------------- TOTAL LIABILITIES. . . . . . . . . . . . . . 684,494,000 630,287,000 --------------------------- Common Stock . . . . . . . . . . . . . . . . 6,755,000 4,417,000 Additional Capital . . . . . . . . . . . . . 26,116,000 26,238,000 Retained Earnings. . . . . . . . . . . . . . 37,933,000 35,390,000 Accumulated Other Comprehensive Income . . . 679,000 1,132,000 Treasury Stock, at Cost. . . . . . . . . . . (2,892,000) (2,900,000) --------------------------- TOTAL SHAREHOLDERS' EQUITY . . . . . . . . . 68,591,000 64,277,000 --------------------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $753,085,000 $694,564,000 --------------------------- Consolidated Statements of Income (Unaudited) ------------------------ Six Months Ended June 30, 2003 2002 - ---------------------------------------------------------------------- INTEREST INCOME: Interest and Fees on Loans. . . . . . . . . . $16,510,000 $17,027,000 Interest and Dividends on Securities. . . . . 2,781,000 3,584,000 Interest on Federal Funds Sold and Short-term Investments . . . . . . . . . . . 21,000 52,000 ------------------------- TOTAL INTEREST INCOME . . . . . . . . . . . . 19,312,000 20,663,000 ------------------------- INTEREST EXPENSE: Interest on Deposits. . . . . . . . . . . . . 3,934,000 5,176,000 Interest on Federal Home Loan Bank Advances . 829,000 861,000 Interest on Securities Sold under Repurchase Agreements and Other Short-term Borrowings. . . . . . . 115,000 244,000 ------------------------- TOTAL INTEREST EXPENSE. . . . . . . . . . . . 4,878,000 6,281,000 ------------------------- NET INTEREST INCOME . . . . . . . . . . . . . 14,434,000 14,382,000 ------------------------- Provision for Loan Losses . . . . . . . . . . 1,134,000 1,125,000 ------------------------- NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES. . . . . . . . . . . . . . . 13,300,000 13,257,000 ------------------------- NONINTEREST INCOME: Investment and Trust Services Division Income 854,000 1,043,000 Fees and Service Charges. . . . . . . . . . . 3,596,000 3,505,000 Gains from Sales of Securities. . . . . . . . 450,000 540,000 Gains on Sales of Loans . . . . . . . . . . . 141,000 45,000 Other Operating Income. . . . . . . . . . . . 130,000 172,000 ------------------------- TOTAL NONINTERST INCOME . . . . . . . . . . . 5,171,000 5,305,000 ------------------------- NONINTEREST EXPENSES: Salaries and Employee Benefits. . . . . . . . 5,671,000 5,762,000 Furniture and Equipment Expenses. . . . . . . 1,160,000 1,088,000 Net Occupancy Expense of Premises . . . . . . 789,000 745,000 Card-related Expenses . . . . . . . . . . . . 636,000 648,000 Supplies and Postage. . . . . . . . . . . . . 538,000 533,000 Outside Services. . . . . . . . . . . . . . . 824,000 668,000 Marketing and Public Relations. . . . . . . . 405,000 552,000 Ohio Franchise Tax. . . . . . . . . . . . . . 362,000 228,000 Other Operating Expenses. . . . . . . . . . . 1,450,000 1,760,000 ------------------------- TOTAL NONINTEREST EXPENSE . . . . . . . . . . 11,835,000 11,984,000 ------------------------- INCOME BEFORE INCOME TAXES. . . . . . . . . . 6,636,000 6,578,000 ------------------------- Income Taxes. . . . . . . . . . . . . . . . . 2,121,000 2,149,000 ------------------------- NET INCOME. . . . . . . . . . . . . . . . . . $ 4,515,000 $ 4,429,000 ------------------------- PER SHARE DATA: BASIC EARNINGS PER SHARE* . . . . . . . . . . $.68 $.67 ------------------------- DILUTED EARNINGS PER SHARE* . . . . . . . . . $.68 $.67 ------------------------- DIVIDENDS DECLARED PER SHARE* . . . . . . . . $.34 $.33 ------------------------- (*) All share and per share data has been adjusted to reflect the 3-for-2 stock split in 2003 and the 2 percent stock dividend in 2002. EX-99 4 lnb072203press.txt LNB BANCORP, INC. PRESS RELEASE OF FIRST HALF 2003 EARNINGS Exhibit 99.2 FOR IMMEDIATE RELEASE Contacts: James H. Weber Senior Vice President, Marketing and Investor Relations Officer Tel: (440) 989-3005 Mitchell J. Fallis, CPA Vice President and Chief Accounting Officer Tel: (440) 244-7145 Gregory D. Friedman, CPA Executive Vice President, Corporate Secretary and Chief Financial Officer Tel: (440) 244-7143 LNB BANCORP, INC., REPORTS 2003 SECOND-QUARTER EARNINGS AND FIRST-HALF REVENUE AND EARNINGS LORAIN, OHIO-JULY 22, 2003-LNB BANCORP, INC. (Nasdaq: LNBB), today announced financial results for the second quarter and six months ended June 30, 2003, with earnings reaching the highest level for any second quarter in the corporation's history. LNB Bancorp, Inc., parent financial holding company of The Lorain National Bank, reported 2003 second-quarter earnings of $2,324,000, an increase of two percent from the previous second-quarter record of $2,281,000 set last year. Basic and diluted earnings per share for the 2003 second quarter of $0.35 were unchanged from the year-ago period. Earnings for the first half of 2003 increased to $4,515,000, or $0.68 per basic and diluted share, from $4,429,000, or $0.67 per basic and diluted share, for the first six months of 2002. All 2002 financial statements and related per-share amounts herein have been restated to reflect the adoption of Statement of Financial Accounting Standards (SFAS) No. 147 "Acquisitions of Certain Financial Institutions" and SFAS No. 142 "Goodwill and Other Intangible Assets" as related to intangibles. Per-share amounts have also been adjusted to reflect a two-percent stock dividend on July 2, 2002, and a three-for-two stock split on March 14, 2003. Net interest income increased less than one percent during the 2003 first half versus the comparable year-ago period. Solid growth in commercial loans plus the downward repricing of interest-bearing liabilities slightly more than offset lower interest rates on the loan and investment portfolios. Noninterest income declined by three percent in 2003's first half. Decreases in Investment and Trust Services Division income of 18 percent, and decreases in gains on sales of securities of 17 percent and 24 percent in other noninterest income were partially offset by a 213 percent increase on gain on sale of loans and a three percent increase in fees and service charges. Noninterest expenses declined one percent for the first half of 2003 compared with the same period in 2002. Decreases in salaries and employee expenses, marketing, and other noninterest expenses offset increases in outside services and other categories. Income taxes decreased $28,000 due to increases in tax- exempt income. Net revenues generated during the second quarter of 2003 decreased less than one percent to $9.9 million, compared with $10.0 million last year. For the first half of the year, net revenues of $19.6 million also decreased less than one percent from $19.7 million in 2002's first six months. Commenting on the results for the period, Gary C. Smith, LNB Bancorp's President and Chief Executive Officer, stated: "In light of the soft economic conditions, we have been working very hard to manage our noninterest expenses. As a result, total noninterest expenses declined approximately $150,000 in this year's first half, compared with last year's first six months." The Bancorp reported that annualized return on average assets (ROAA) for the 2003 first half was 1.26 percent, compared with 1.23 percent for 2002's first half. The annualized return on average shareholders' equity (ROAE) for first- half 2003 was 13.45 percent versus 13.15 percent in last year's comparable period. Total assets increased eight percent to $753.1 million at June 30, 2003, up $58.5 million from June 30, 2002. Net loans increased six percent to $520.1 million from $493.0 million, led by strong commercial loan growth offset somewhat by a refinancing-induced decline in residential mortgage loans during the 12 months ended June 30, 2003. The security portfolio increased to $165.8 million at June 30, 2003, up $19.0 million or 12.9 percent from one year ago. Increases in United States government agency securities accounted for most of the increase. Total deposits climbed seven percent to $591.6 million, up $38.1 million from one year ago. Growth in demand deposits, savings, certificates of deposit and CheckInvest deposits were partially offset by declines in money market and Market Access deposits. Other borrowings increased 23 percent to $86.5 million at June 30, 2003, from $70.5 million one year ago due to increases in Federal Home Loan Bank advances of $20.6 million, partially offset by decreases in repurchase agreements of $4.6 million. At June 30, 2003, shareholders' equity reached an all-time high of $68.6 million, up $4.3 million or seven percent from one year ago; and book value per share climbed to $10.38 from $9.70 at June 30, 2002. Capital ratios remained strong during the period, with average equity to average assets of 9.3 percent. LNB Bancorp, Inc., and Lorain National Bank exceed all applicable regulatory capital requirements. Under Federal Deposit Insurance Corporation (FDIC) guidelines, Lorain National Bank is categorized as "well capitalized" the highest rating category available. Total cash dividends declared during the first half of 2003 increased to $2,246,000, compared with $2,179,000 for the first half of 2002. Dividends declared increased three percent, on a per-share basis, in the first half of 2003 reaching $0.34 versus last year's $0.33. ABOUT LNB BANCORP, INC. LNB Bancorp, Inc., is a $753-million financial holding company with two wholly owned subsidiaries: The Lorain National Bank and Charleston Insurance Agency, Inc., and a 49-percent-owned subsidiary, Charleston Title Agency, LLC. LNB Bancorp's primary subsidiary, The Lorain National Bank, provides a full spectrum of financial services, including full-service community banking, specializing in commercial, mortgage and personal banking services, and investment and trust services. Lorain National Bank also offers long- term, fixed-rate mortgages via the secondary mortgage market. Brokerage services including stocks, bonds, mutual funds and variable-annuity investments are also offered at Lorain National Bank through Raymond James Financial Services, Inc. (member NASD/SIPC), a registered broker/dealer. North Coast Community Development Corporation, a wholly owned subsidiary of The Lorain National Bank, is a community development entity (CDE), formed and approved in 2002, that provides qualified community businesses with debt financing including commercial mortgage, construction, and commercial equipment loans aimed at stimulating economic growth and job creation in low- and moderate-income census tracts in Lorain County, Ohio. Charleston Insurance Agency, Inc., offers life, long-term-care insurance and fixed- annuity products. Charleston Title Agency, LLC, offers traditional title services. Lorain National Bank serves customers through 21 retail-banking centers and 27 ATMs in Ohio's Lorain, eastern Erie and western Cuyahoga counties. For more information about LNB Bancorp, Inc., and its related products and services or to view its filings with the Securities and Exchange Commission, including Forms 10-K, 10-Q and 8-K, please visit http://www.4lnb.com. This press release contains forward-looking statements based on current expectations that are covered under the "safe-harbor" provision of the Securities Litigation Reform Act of 1995. Certain forward-looking statements, which involve inherent risks and uncertainties, are described in LNB Bancorp's filings with the Securities and Exchange Commission. A number of important factors could cause actual results to differ materially from those in the forward-looking statements. Those factors include fluctuations in interest rates, inflation, government regulations, and economic conditions and competition in the geographic and business areas in which LNB Bancorp, Inc., conducts its operations. --FINANCIAL HIGHLIGHTS FOLLOW-- LNB Bancorp, Inc. FINANCIAL HIGHLIGHTS (In thousands, except per-share data; unaudited PERCENT THREE MONTHS ENDED JUNE 30, 2003 2002 CHANGE - ---------------------------- --------- --------- --------- Net interest income $ 7,274 $ 7,299 (0)% Noninterest income 2,665 2,667 (0)% --------- --------- Revenue $ 9,939 $ 9,966 (0)% Provision for loan losses 570 525 9% Noninterest expenses 5,889 6,056 (3)% --------- --------- Income before income taxes $ 3,480 3,385 3% Income taxes 1,156 1,104 (5)% --------- --------- Net income $ 2,324 $ 2,281 2% PER SHARE DATA: Earnings (basic and diluted) $ 0.35 $ 0.35 Cash dividend declared $ 0.17 $ 0.17 Weighted average shares outstanding: Basic 6,603,920 6,601,548 Diluted 6,624,263 6,606,758 PERCENT SIX MONTHS ENDED JUNE 30, 2003 2002 CHANGE - ---------------------------- --------- --------- --------- Net interest income $14,434 $14,382 0% Noninterest income 5,171 5,305 (3)% --------- --------- Revenue $19,605 $19,687 (0)% Provision for loan losses 1,134 1,125 (1)% Noninterest expenses 11,835 11,984 (1)% --------- --------- Income before income taxes $ 6,636 6,578 1% Income taxes 2,121 2,149 (1)% --------- --------- Net income $ 4,515 $ 4,429 2% FINANCIAL RATIOS: Annualized Return on average assets 1.26% 1.23% Annualized Return on average equity 13.45% 13.15% Net interest margin 4.31% 4.58% Efficiency ratio 61.01% 62.76% Loan loss reserve/gross loans 1.35% 1.23% PER SHARE DATA: Earnings (basic and diluted) $ 0.68 $ 0.67 Cash dividend declared $ 0.34 $ 0.33 Weighted average shares outstanding: Basic 6,602,924 6,601,548 Diluted 6,620,932 6,605,630 PERCENT AT JUNE 30, 2003 2002 CHANGE - ---------------------------- --------- --------- --------- Total assets $ 753,085 $ 694,564 8% Net loans $ 520,118 $ 492,962 6% Total deposits $ 591,630 $ 553,511 7% Other borrowings $ 86,505 $ 70,508 23% Total shareholders' equity $ 68,591 $ 64,277 7% Book value per share $ 10.38 $ 9.70 7% -----END PRIVACY-ENHANCED MESSAGE-----