8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC

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)   May 13, 2011
LSB Financial Corp.
(Exact Name of Registrant as Specified in Its Charter)
Indiana	0-25070	35-1934975
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
101 Main Street, Lafayette, Indiana		47901
(Address of Principal Executive Offices)		(Zip Code)
(765) 742-1064
(Registrant’s Telephone Number, Including Area Code)
(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:

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

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

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

¨ 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 May 13, 2011, LSB Financial Corp. issued a press release reporting its results of operations and financial condition for the quarter ended March 31, 2011.

A copy of the press release is attached as Exhibit 99.1 to this Current Report and is incorporated herein by this reference. The information disclosed under this Item 2.02, including Exhibit 99.1 hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be deemed incorporated by reference into any filing made under the Securities Act of 1933, except as expressly set forth by specific reference in such filing.

Item 9.01  Financial Statements and Exhibits.

(d)  Exhibits
Exhibit No.	Description
99.1	Press Release issued May 13, 2011

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 hereto duly authorized.

Date: May 13, 2011	LSB Financial Corp.
	By:	/s/ Mary Jo David
		Mary Jo David, Treasurer (Principal Financial and Accounting Officer)

EXHIBIT INDEX

Exhibit Number	Exhibit Description	Location
99.1	Press Release, dated May 13, 2011	Attached

EX-99.1

Exhibit 99.1

101 Main St.

P.O. Box 1628

Lafayette, IN 47902

(765) 742-1064

www.LSBANK.com

lsbmail@LSBANK.com

FOR IMMEDIATE RELEASE	For further information contact:
	Randolph F. Williams
	President/CEO
	(765) 742-1064
	Fax: (765) 429-5932

LSB Financial Corp. Announces First Quarter Results

May 13, 2011, Lafayette, IN - LSB Financial Corp. (NASDAQ:LSBI), the parent company of Lafayette Savings Bank, FSB, today reported quarterly earnings of $205,000 or $0.13 diluted earnings per share compared to $532,000 or $0.34 diluted earnings per share a year earlier.  The major contributor to the bank’s performance, net interest income, was up $416,000, a 14% improvement over last year.  Interest income totaled $4.5 million while interest expense decreased to $1.1 million resulting in net interest income of $3.4 million compared to last year’s level of $2.9 million.  Randolph F. Williams, president and CEO stated, “Pre-tax, pre-provision (“PTPP”) income continues to be strong and indicates that the core performance of the bank is robust.  This quarter’s PTPP income was up 48% from the first quarter of 2008 at the beginning of the recession, up 50% from the first quarter of 2009 and up 19% from the first quarter of 2010.”

The major offsetting factor to income was the loan loss provision of $1,176,000 in the first quarter, compared to a provision of $434,000 in the same quarter last year.  The main reason for the increase was the addition of specific reserves on impaired loans due to circumstances arising in the quarter that affected our evaluation of the credits.  This substantial provision brings the loan loss reserve to $6.5 million, up from $4.1 million at March 31, 2010 and now stands at 2.03% of total loans.   At quarter end, non-performing assets totaled $19.8 million or 5.44% of total assets, compared to $19.3 million or 5.18%, at the end of 2010.  Williams continued, “We believe it is important as we continue to work with our borrowers that we also prudently set aside reserves.  The $19.8 million of non-performing assets includes $6.2 million or 32.4% of loans where the borrower has been able to resume payments but because of regulatory guidelines must remain categorized as non-performing for at least six months to show a pattern of performance.  This quarter we were able to upgrade several loans from this status and expect to see more progress in the coming quarters.  The loan loss reserve now stands at 33.1% of the non-performing assets.  The level of OREO (other real estate owned) is $1.0 million, an improvement from $1.2 million at year-end.”

The bank continues to maintain a strong capital base with a capital-to-asset ratio at March 31, 2011 of 9.84% and a risk-based capital ratio of 14.13%, both of which are well above the current definition of “well-capitalized” as defined by the bank regulators.  Capital increased by nearly 4.75% since last year as the bank increased capital and reduced our asset size, thereby improving our leverage.  Once the new capital requirements mandated under the Dodd-Frank Act become known, we will be better able to set our longer term capital targets.

The closing market price of LSB stock on May 12, 2011 was $15.67 per share as reported by the Nasdaq Global Market.

LSB FINANCIAL CORP. SELECTED CONSOLIDATED FINANCIAL INFORMATION (Dollars in thousands except share and per share amounts)
Selected balance sheet data:	Three months ended March 31, 2011			Year ended December 31, 2010
Cash and due from banks	$	8,495		$	10,593
Short-term investments		4,166			2,980
Securities available-for-sale		11,994			11,805
Loans held for sale		489			2,265
Net portfolio loans		315,630			320,810
Allowance for loan losses		6,547			5,343
Premises and equipment, net		6,099			6,116
Federal Home Loan Bank stock, at cost		3,583			3,583
Bank owned life insurance		6,306			6,264
Other assets		7,015			7,431
Total assets		363,777			371,847
Deposits		304,929			311,458
Advances from Federal Home Loan Bank		20,500			22,500
Other liabilities		2,543			2,312
Shareholders’ equity		35,805			35,577
Book value per share	$	23.05		$	22.90
Equity / assets		9.84	%		9.57	%
Total shares outstanding		1,553,525			1,553,525
Asset quality data:
Non-accruing loans	$	18,757		$	17,370
Loans past due 90 days still on accrual		---			676
Other real estate / assets owned		1,024			1,214
Total non-performing assets		19,781			19,260
Non-performing loans / total loans		5.81	%		5.50	%
Non-performing assets / total assets		5.44	%		5.18	%
Allowance for loan losses / non-performing loans		34.90	%		29.61	%
Allowance for loan losses / non-performing assets		33.10	%		27.74	%
Allowance for loan losses / total loans		2.03	%		1.65	%
Loans charged off (quarter-to-date and year-to-date, respectively)	$	9		$	1,382
Recoveries on loans previously charged off		37			229

	Three months ended March 31,
Selected operating data:	2011			2010
Total interest income	$	4,475		$	4,671
Total interest expense		1,111			1,723
Net interest income		3,364			2,948
Provision for loan losses		1,176			434
Net interest income after provision for loan losses		2,188			2,514
Non-interest income:
Deposit account service charges		292			367
Gain on sale of mortgage loans		164			85
Net (loss) on sale of real estate owned		(24	)		(33	)
Other non-interest income		260			275
Total non-interest income		692			694
Non-interest expense:
Salaries and benefits		1,410			1,292
Occupancy and equipment, net		329			339
Computer service		142			127
Advertising		58			56
Other		650			599
Total non-interest expense		2,589			2,413
Income before income taxes		291			795
Income tax expense		86			263
Net income		205			532
Weighted average number of diluted shares		1,556,240			1,553,535
Diluted earnings per share	$	0.13		$	0.34
Return on average equity		2.29	%		6.23	%
Return on average assets		0.22	%		0.57	%
Average earning assets	$	339,878		$	341,481
Net interest margin		3.96	%		3.45	%
Efficiency ratio		89.90	%		75.22	%