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)   March 9, 2012
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 March 9, 2012, LSB Financial Corp. issued a press release reporting its results of operations and financial condition for the fourth quarter and year ended December 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 March 9, 2012

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: March 13, 2012	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 March 9, 2012	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:
March 9, 2012	Randolph F. Williams
	President/CEO
	(765) 742-1064
	Fax: (765) 429-5932

LSB Financial Corp. Announces Year-end and Fourth Quarter Results

Lafayette, IN - LSB Financial Corp. (NASDAQ:LSBI), the parent company of Lafayette Savings Bank, FSB, today reported net income for 2011 of $539,000 or $0.35 per share, compared to net income of $2.1 million or $1.36 per share for 2010.  The decrease in income was primarily due to a $2.6 million or 94% increase in the loan loss provision as a result of steps taken in 2011 to reduce non-performing loans, offset by a $625,000 increase in net interest income. During the year we charged off $5.4 million against loan loss reserves, while recovering $67,000 and replenishing the reserves by $5.4 million. Over $2.5 million of the charge-offs were the result of lowered appraisal values on commercial properties received in the fourth quarter.  A 33% improvement in non-performing loans from $18.0 million at December 31, 2010 to $12.1 million at December 31, 2011, resulted in a ratio of non-performing loans to total loans of 3.95% at December 31, 2011 compared to 5.59% in 2010.    The fourth quarter appraisal charge-offs resulted in a fourth quarter loss of $600,000 compared to net income of $602,000 in the fourth quarter of 2010.

LSB President and CEO, Randolph F. Williams, stated, “The steps we took in 2011 to address non-performing loans resulted in an improvement in our loan loss reserve to non-performing loan ratio to 44.21%, up from 29.61% at the end of 2010.  Our loan loss reserve, as a percent of total loans, increased to 1.74% from 1.65%.  We believe that these steps position us well in 2012 and forward.  The loan loss reserve at both December 31, 2010 and December 31, 2011 was $5.3 million.”

Mr. Williams continued, “The core profitability of the bank remains strong.  Our net interest margin remains high at 4.02%, up from 3.68% at the end of 2010.  As a community bank we generate our earnings primarily by gathering deposits and making loans. Our 98% loan-to-deposit ratio is further evidence that we consider ourselves first and foremost a community bank.”

“Our balance sheet shows our success in attracting and maintaining local deposits.  By actively managing the balance sheet we have been able to pay competitive rates to depositors and reduce our reliance on funds from outside our market area.  We continue to deleverage, reducing loans by $18.3 million and increasing our capital ratio from 9.57% to 9.93%.”

The bank continues to be a leading home lender in the market originating $ 61.0 million in residential loans and generating $1.1 million of fees from the sale of $52.7 million of these loans.   Mr. Williams added, “The recent announcement by the National Association of Home Builders that Lafayette now ranks as one of the Country’s 76 “improving markets”, information from the Federal Housing Finance Agency that Lafayette ranks in the top 10% in year-over-year housing appreciation and our December unemployment rate of 7.5% all bode well for our market.”

While community bank stocks have been hard hit, we are proud to have been named to the Indianapolis Business Journal’s top 25 performing Indiana stocks in 2011.

The closing price of LSB stock on March 8, 2012 was $16.81 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:	December 31, 2011			December 31, 2010
Cash and due from banks	$	18,552		$	10,593
Interest bearing deposits		3,156			2,980
Securities available-for-sale		13,845			11,805
Loans held for sale		3,120			2,265
Net portfolio loans		302,510			320,810
Allowance for loan losses		5,331			5,343
Premises and equipment, net		6,146			6,116
Federal Home Loan Bank stock, at cost		3,185			3,583
Bank-owned life insurance		6,434			6,264
Other assets		7,342			7,431
Total assets		364,290			371,847
Deposits		308,433			311,458
Federal Home Loan Bank advances		18,000			22,500
Other liabilities		1,683			2,312
Total liabilities		328,116			336,270
Shareholders’ equity		36,174			35,577
Book value per share	$	23.26		$	22.90
Equity / assets		9.93	%		9.56	%
Total shares outstanding		1,555,222			1,553,525
Asset quality data:
Non-accruing loans	$	12,059		$	18,046
Loans past due 90 days still on accrual		---			676
Other real estate / assets owned		1,746			1,214
Total non-performing assets		13,805			19,260
Non-performing assets / total assets		3.79	%		5.18	%
Allowance for loan losses / non-performing loans		44.21	%		29.61	%
Allowance for loan losses / non-performing assets		38.62	%		27.67	%
Allowance for loan losses / total loans		1.74	%		1.65	%
Loans charged off	$	5,440		$	1,382
Recoveries on loans previously charged off		67			229

	Three months ended December 31,						Year ended December 31,
Selected operating data:	2011			2010			2011			2010
Total interest income	$	4,362		$	4,626		$	17,594		$	18,895
Total interest expense		991			1,331			4,189			6,115
Net interest income		3,371			3,295			13,405			12,780
Provision for loan losses		2,625			950			5,361			2,759
Net interest income after provision		746			2,345			8,044			10,021
Non-interest income:
Deposit account service charges		405			365			1,397			1,522
Gain on sale of mortgage loans		357			477			1,080			1,019
Gain(loss) on sale of available-for-sale securities		47			---			54			---
Gain(loss) on sale OREO		(261	)		8			(700	)		(441	)
Other non-interest income		226			174			1,077			980
Total non-interest income		774			1,024			2,908			3,080
Non-interest expense:
Salaries and benefits		1,246			1,275			5,465			5,288
Occupancy and equipment, net		265			317			1,154			1,303
Computer service		142			147			576			569
Advertising		94			79			304			282
FDIC Insurance Premium		120			185			556			679
Other		700			450			2,204			1,811
Total non-interest expense		2,567			2,453			10,259			9,932
Income before income taxes		(1,044	)		916			693			3,169
Income tax expense		(444	)		314			154			1,052
Net income		(600	)		602			539			2,117
Weighted average number of diluted shares		1,556,352			1,554,697			1,555,253			1,554,720
Diluted earnings per share	$	(0.39	)	$	0.39		$	0.35		$	1.36
Return on average equity		(6.52	%)		6.77	%		1.48	%		6.09	%
Return on average assets		(0.66	%)		0.64	%		0.15	%		0.56	%
Average earning assets	$	330,144		$	345,930		$	333,278		$	347,299
Net interest margin		4.09	%		3.95	%		4.02	%		3.68	%
Efficiency ratio		168.55	%		72.81	%		93.67	%		75.81	%