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): January 26, 2009

First Citizens Banc Corp
(Exact name of registrant as specified in its charter)

Ohio	0-25980	34-1558688
(State or other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

100 East Water Street, P.O. Box 5016, Sandusky, Ohio	44870
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (419) 625-4121

N/A

(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 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 2.06. Material Impairments.

On January 26, 2009, First Citizens Banc Corp (“Citizens”) determined that, as a result of its annual impairment analysis for “Goodwill and Other Intangible Assets”, it will record a pre-tax non-cash impairment charge of $43,291,000 against goodwill as of December 31, 2008.

In connection with its acquisition of other institutions, Citizens recorded as goodwill the difference between the market value of the stock issued in the transaction and the book value of the assets acquired. Statement of Financial Accounting Standards, No. 142, “Goodwill and Other Intangible Assets” requires goodwill to be tested for impairment at least annually. Among the factors considered in the 2008 review were the prices, depressed by market conditions, paid for comparable institutions which have been sold. Upon completion of Citizens’ review, it determined that its books did not currently reflect the value of its goodwill and that it should record the impairment charge.

This charge to earnings will have no impact on Citizens’ cash, regulatory capital, liquidity or ability to pay dividends. The charge is not deductible for income tax purposes.

Item 8.01. Other Events.

On January 29, 2009, the Corporation released an open letter to our customers, shareholders and the communities in which we operate. This letter will appear in the newspapers in the communities in which we operate.

Additionally, on February 1, 2009 the Corporation will mail a letter to the shareholders describing certain current developments related to the Corporation.

Item 9.01. Financial Statements and Exhibits.

(a) Not applicable

(b) Not applicable

(c) Not applicable

(d) Exhibits

The following exhibits are included with this Current Report on Form 8-K:

Exhibit No.	Description
99.1	Letter to customers, shareholders and communities of First Citizens Banc Corp released January 29, 2009
99.2	Letter to shareholders of First Citizens Banc Corp dated February 1, 2009

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.

First Citizens Banc Corp

/s/ James O. Miller	January 29, 2009
James O. Miller President and CEO	Date

INDEX TO EXHIBITS

Exhibit No.	Description
99.1	Letter to customers, shareholders and communities of First Citizens Banc Corp released January 29, 2009
99.2	Letter to shareholders of First Citizens Banc Corp dated February 1, 2009

EX-99.1

Exhibit 99.1

An Open Letter to Our Customers, Shareholders, and Community

With more than 38,000 customers, 360 employees, and approximately 2700 local shareholders, First Citizens Banc Corp is very much a part of our communities. Operating as Citizens Bank in Northern Ohio and Champaign Bank in Central Ohio we have been fortunate to have avoided many of the issues plaguing the financial world. We did not participate in the exotic lending products or the exotic investment products which appear to have triggered the financial downturn. What we are unable to avoid is the impact of this recession which we see descending on our customers and communities. As an integral part of the communities we serve, we believe it is important to communicate honestly and openly.

Company Results
We are pleased to report that our fourth quarter earnings before a non-cash goodwill adjustment was approximately $.22 per share. Our 2008 earnings were approximately $.56 per share before a non-cash goodwill adjustment. First Citizens Banc Corp paid a dividend for each quarter of 2008 and on February 1, 2009, will pay a dividend on its common stock of $.15 per share. In spite of the impact of this recession, in 2008 we did have cash earnings and we did pay dividends. Many banks in Ohio and across the nation will be unable to say this.

US Treasury Capital Purchase Program
We were approved for and received $23,184,000 from the Treasury as part of their Capital Purchase Program. Contrary to popular belief this was neither a bailout nor is it free. This Treasury program is being offered to strengthen healthy institutions. While we meet the regulatory requirements for being well capitalized without this program, we firmly believe that, absent knowing the extent and depth of this economic recession, it is prudent to have the additional capital and liquidity that the program offers. The objective of the CPP program is to put this money to work in our communities.

Goodwill Accounting
Since 1990 First Citizens Banc Corp has acquired five community bank partners. Accounting rules require an annual analysis of the goodwill generated by these acquisitions. Since the value of practically everything that is sold in this economic climate has diminished, so too has the value of our goodwill. We will book a goodwill write-down of approximately $43,000,000 as part of the fourth quarter results. It is important to understand that a goodwill write-down does not affect cash, cash earnings, dividends, liquidity, or regulatory capital. While a very large number - - it is just a paper entry. You will find many corporation making goodwill adjustments in their fourth quarter reports.

Safety and Soundness
As with all banks we are a member of the FDIC providing $250,000 deposit insurance coverage. We are also a participant in the FDIC’s Transaction Account Guarantee Program which provides unlimited insurance coverage on non-interest bearing checking accounts. The bank recently joined the CDARS program which can provide up to $55,000,000 in deposit coverage for customers who have multiple deposit accounts that may exceed the base FDIC coverage of $250,000.

2009
We are all seeing the impact of the recession. Layoffs and slowdowns are becoming a daily occurrence. Because this affects you it affects us. We also believe this is not going to turn around quickly. Unless a customer has abandoned their business or home, our goal is to work with the customer to avoid a foreclosure or repossession. While we may not always be successful at this, our bank has been part of our communities since the 19^th Century and we believe it’s important for all of us to work together to weather through this economy. As troubling as all this may appear, we must keep in mind that economic ups and downs are always temporary.

Sincerely,

James O. Miller
President and CEO

EX-99.2

Exhibit 99.2

February 1, 2009

Dear Shareholder:

Enclosed is your February 1 dividend of $.15 per common share. This is equal to our November 1, 2008 dividend.

The preliminary estimate of our fourth quarter earnings, before any non-cash goodwill adjustment, will be approximately $.22 per common share. With these results, our preliminary estimate of the total earnings for 2008 would have been approximately $.56 per common share. However, a non-cash adjustment to the goodwill on our books will affect our results.

I wrote previously that we were completing an annual review of the goodwill on the corporation’s books as a result of acquisitions over the years. As we made acquisitions, accounting rules required that we record as goodwill the difference between the purchase price of the acquisition and the adjusted book value of the assets acquired. In those better times, bank stock prices were substantially higher than their book values. By using the strong purchasing power of our stock in place of cash to pay for the bulk of our acquisitions, we recorded goodwill. The annual review of the value of the goodwill is influenced by the current sale prices of comparable acquired banks and other factors. Since the value of practically everything that is sold in this economic climate has diminished, so too has the value of our goodwill. My earlier letter indicated that the review could lead to a significant write-down. The review has now been completed and, as a result, we will book a goodwill write-down of approximately $43,000,000 as part of the fourth quarter results.

Although this is a technical accounting entry, it remains a very large amount. But, as an accounting issue, we must remember that it does not affect cash or cash earnings, it does not affect our liquidity, it does not affect regulatory capital, and it will not affect dividends. Because this does not affect regulatory capital, we remain “well capitalized” based upon the Federal Reserve’s regulatory requirements. You will see many banks reporting goodwill write-downs in their 2008 results.

At the January 5, 2009, shareholder’s meeting approximately 90% of our voting shareholders approved the recommendation to authorize preferred stock so that we could participate in the United States Treasury’s Capital Purchase Program. On January 23, 2009, the Treasury completed its purchase of preferred stock for $23,184,000. This Treasury program is being offered to strengthen healthy institutions, and they are the only ones who have been provided the opportunity to participate. While we meet the requirements for being well capitalized without this investment, we still firmly believe that, absent knowing the breadth and depth of this economic recession, it is prudent to have the additional capital and liquidity the program offers. We will attempt to put this money to work as quickly as possible to make the investment self-sustaining. If our economy improves quickly, we can repurchase this preferred stock in three to five years. If the economy does not turn around quickly, we will be glad to have the extra capital.

Loss reserves and goodwill aside, our core business remains solid. Based on comparisons recently received (from September 30 reports) regarding publicly traded banks, we outperformed both the Ohio and National averages for return on assets, return on equity, margin, and efficiency ratio. This performance has provided the flexibility for us to handle the financial impact of loan losses. In spite of the substantial dollars placed in the loss reserve and the added expenses of loan workouts, for 2008 we did have cash earnings and we did pay dividends. Many banks in Ohio and across the nation will be unable to say this.

I have talked with many of you and know that our stock price and dividend, as well as the prices and dividends of most stocks in your portfolios, are a concern. I know that the bombardment by the news media with reports on economic problems is becoming wearisome – we understand this – we also receive these reports every day from news and banking publications and from our customers who are experiencing the impact of layoffs and slowdowns. As troubling and unrelenting as all this may appear to be, we must keep in mind that economic ups and downs are temporary.

Our pledge going into 2009 remains consistent. We are going to continue to focus on strengthening our asset quality (by working with consumers and businesses that face economic challenges), maintaining a strong capital position, and maintaining a strong liquidity position. This focus, endorsed by our regulators, will get us through this recession with the least negative impact to the corporation and in a position to take advantage of opportunities as the economy turns around.

By mid-March you will receive the annual report. It will contain more detailed financial information, our recap of 2008, and information about what we envision going forward. If you have any questions, a call is always welcomed.

Sincerely,

James O. Miller
President & CEO

Cautionary Statement Regarding Forward-Looking Information

Comments made in this letter include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to numerous assumptions, risks and uncertainties. Although management believes that the expectations reflected in the forward-looking statements are reasonable, actual results or future events could differ, possibly materially, from those anticipated in these forward-looking statements. The forward-looking statements speak only as of the date of this letter, and First Citizens Banc Corp assumes no duty to update any forward-looking statements to reflect events or circumstances after the date of this letter, except to the extent required by law.