EX-99.2 3 lcnb-x8xkexhibit992xx2019q.htm EXHIBIT 99.2 Exhibit


Exhibit 99.2

LCNB Corp. and Subsidiaries
Financial Highlights
(Dollars in thousands, except per share amounts)
(Unaudited)
 
Three Months Ended
 
3/31/2019
 
12/31/2018
 
9/30/2018
 
6/30/2018
 
3/31/2018
Condensed Income Statement
 
 
 
 
 
 
 
 
 
Interest income
$
16,113

 
15,844

 
15,070

 
12,538

 
11,142

Interest expense
2,722

 
2,334

 
1,967

 
1,170

 
954

Net interest income
13,391

 
13,510

 
13,103

 
11,368

 
10,188

Provision for loan losses
(105
)
 
(39
)
 
659

 
224

 
79

Net interest income after provision
13,496

 
13,549

 
12,444

 
11,144

 
10,109

Non-interest income
2,772

 
2,702

 
2,921

 
2,791

 
2,636

Non-interest expense
10,700

 
9,925

 
10,317

 
10,711

 
9,549

Income before income taxes
5,568

 
6,326

 
5,048

 
3,224

 
3,196

Provision for income taxes
941

 
1,133

 
847

 
486

 
483

Net income
$
4,627

 
5,193

 
4,201

 
2,738

 
2,713

Amort/Accret income on acquired loans
$
224

 
229

 
198

 
44

 
96

Amort/Accret expenses on acquired interest-bearing liabilities
$
144

 
149

 
214

 

 

Tax-equivalent net interest income
$
13,536

 
13,680

 
13,279

 
11,549

 
10,375

 
 
 
 
 
 
 
 
 
 
Per Share Data
 
 
 
 
 
 
 
 
 
Dividends per share
$
0.17

 
0.17

 
0.16

 
0.16

 
0.16

Basic earnings per common share
$
0.35

 
0.40

 
0.32

 
0.25

 
0.27

Diluted earnings per common share
$
0.35

 
0.40

 
0.32

 
0.25

 
0.27

Book value per share
$
16.83

 
16.47

 
16.05

 
15.97

 
14.80

Tangible book value per share
$
12.05

 
11.67

 
11.23

 
11.14

 
11.47

Weighted average common shares outstanding:
 
 
 
 
 
 
 
 
Basic
13,283,634

 
13,285,386

 
13,285,203

 
11,099,485

 
10,020,611

Diluted
13,287,338

 
13,290,499

 
13,290,665

 
11,105,014

 
10,028,588

Shares outstanding at period end
13,314,148

 
13,295,276

 
13,304,976

 
13,299,235

 
10,041,152

 
 
 
 
 
 
 
 
 
 
Selected Financial Ratios
 
 
 
 
 
 
 
 
 
Return on average assets
1.15
 %
 
1.27
 %
 
1.03
%
 
0.78
%
 
0.85
 %
Return on average equity
8.47
 %
 
9.55
 %
 
7.76
%
 
6.46
%
 
7.33
 %
Dividend payout ratio
48.57
 %
 
42.50
 %
 
50.00
%
 
64.00
%
 
59.26
 %
Net interest margin (tax equivalent)
3.71
 %
 
3.69
 %
 
3.59
%
 
3.63
%
 
3.59
 %
Efficiency ratio (tax equivalent)
65.61
 %
 
60.58
 %
 
63.69
%
 
74.69
%
 
73.39
 %
 
 
 
 
 
 
 
 
 
 
Selected Balance Sheet Items
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
19,527

 
20,040

 
19,812

 
24,901

 
17,494

Debt and equity securities
264,559

 
282,813

 
299,786

 
311,047

 
310,009

 
 
 
 
 
 
 
 
 
 
Loans:
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
79,725

 
77,740

 
78,002

 
81,778

 
37,118

Commercial, secured by real estate
764,424

 
740,647

 
704,987

 
705,978

 
542,890

Residential real estate
334,227

 
349,127

 
347,920

 
339,435

 
246,487

Consumer
17,409

 
17,283

 
17,505

 
17,705

 
17,176

  Agricultural
10,900

 
13,297

 
13,280

 
13,390

 
12,217

Other, including deposit overdrafts
409

 
450

 
498

 
583

 
506

Deferred net origination costs
40

 
79

 
133

 
229

 
263

  Loans, gross
1,207,134

 
1,198,623

 
1,162,325

 
1,159,098

 
856,657

Less allowance for loan losses
4,126

 
4,046

 
4,016

 
3,603

 
3,529

  Loans, net
$
1,203,008

 
1,194,577

 
1,158,309

 
1,155,495

 
853,128

 
 
 
 
 
 
 
 
 
 
Total earning assets
$
1,476,862

 
1,483,166

 
1,465,787

 
1,471,923

 
1,171,447

Total assets
1,632,387

 
1,636,927

 
1,620,299

 
1,631,442

 
1,288,791

Total deposits
1,347,857

 
1,300,919

 
1,371,023

 
1,380,884

 
1,123,463

 
 
 
 
 
 
 
 
 
 





 
Three Months Ended
 
3/31/2019
 
12/31/2018
 
9/30/2018
 
6/30/2018
 
3/31/2018
Selected Balance Sheet Items, continued
 
 
 
 
 
 
 
 
Short-term borrowings
0

 
56,230

 
0

 
0

 
0

Long-term debt
42,982

 
47,032

 
23,079

 
27,085

 
6,219

Total shareholders’ equity
224,018

 
218,985

 
213,515

 
212,366

 
148,584

Equity to assets ratio
13.72
 %
 
13.38
 %
 
13.18
%
 
13.02
%
 
11.53
 %
Loans to deposits ratio
89.56
 %
 
92.14
 %
 
84.78
%
 
83.94
%
 
76.25
 %
 
 
 
 
 
 
 
 
 
 
Tangible common equity (TCE)
$
160,488

 
155,197

 
149,398

 
147,705

 
114,801

Tangible common assets (TCA)
1,568,857

 
1,573,139

 
1,556,182

 
1,566,781

 
1,255,008

TCE/TCA
10.23
 %
 
9.87
 %
 
9.60
%
 
9.43
%
 
9.15
 %
 
 
 
 
 
 
 
 
 
 
Selected Average Balance Sheet Items
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
25,080

 
20,685

 
25,920

 
27,319

 
21,820

Debt and equity securities
266,081

 
291,433

 
304,112

 
306,366

 
313,689

 
 
 
 
 
 
 
 
 
 
Loans
$
1,208,809

 
1,177,061

 
1,155,846

 
961,726

 
853,152

Less allowance for loan losses
4,074

 
4,016

 
3,622

 
4,245

 
3,401

Net loans
$
1,204,735

 
1,173,045

 
1,152,224

 
957,481

 
849,751

 
 
 
 
 
 
 
 
 
 
Total earning assets
$
1,480,634

 
1,471,650

 
1,465,510

 
1,276,176

 
1,170,708

Total assets
1,635,416

 
1,626,029

 
1,623,016

 
1,409,698

 
1,292,375

Total deposits
1,333,529

 
1,333,673

 
1,367,950

 
1,212,104

 
1,114,979

Short-term borrowings
23,235

 
36,348

 
1,833

 
3,491

 
14,086

Long-term debt
44,676

 
25,536

 
25,757

 
13,252

 
2,255

Total shareholders’ equity
221,470

 
215,739

 
214,769

 
170,077

 
150,058

Equity to assets ratio
13.54
 %
 
13.27
 %
 
13.23
%
 
12.06
%
 
11.61
 %
Loans to deposits ratio
90.65
 %
 
88.26
 %
 
84.49
%
 
79.34
%
 
76.52
 %
 
 
 
 
 
 
 
 
 
 
Asset Quality
 
 
 
 
 
 
 
 
 
Net charge-offs (recoveries)
$
(185
)
 
(68
)
 
245

 
150

 
(47
)
Other real estate owned
244

 
244

 
35

 
35

 

 
 
 
 
 
 
 
 
 
 
Non-accrual loans
2,845

 
2,951

 
2,603

 
4,065

 
2,744

Loans past due 90 days or more and still accruing
177

 
149

 
1

 
5

 
146

Total nonperforming loans
$
3,022

 
3,100

 
2,604

 
4,070

 
2,890

 
 
 
 
 
 
 
 
 
 
Net charge-offs (recoveries) to average loans
(0.06
)%
 
(0.02
)%
 
0.08
%
 
0.06
%
 
(0.02
)%
Allowance for loan losses to total loans
0.34
 %
 
0.34
 %
 
0.35
%
 
0.31
%
 
0.41
 %
Nonperforming loans to total loans
0.25
 %
 
0.26
 %
 
0.22
%
 
0.35
%
 
0.34
 %
Nonperforming assets to total assets
0.20
 %
 
0.20
 %
 
0.16
%
 
0.25
%
 
0.22
 %
 
 
 
 
 
 
 
 
 
 
Assets Under Management
 
 
 
 
 
 
 
 
 
LCNB Corp. total assets
$
1,632,387

 
1,636,927

 
1,620,299

 
1,631,442

 
1,288,791

Trust and investments (fair value)
367,649

 
337,549

 
386,582

 
370,587

 
359,766

Mortgage loans serviced
89,049

 
97,685

 
115,647

 
114,536

 
90,630

Cash management
55,981

 
48,906

 
36,502

 
48,369

 
72,372

Brokerage accounts (fair value)
245,758

 
233,751

 
247,175

 
238,651

 
230,168

Total assets managed
$
2,390,824

 
2,354,818

 
2,406,205

 
2,403,585

 
2,041,727

 
 
 
 
 
 
 
 
 
 
Non-GAAP Financial Measures
 
 
 
 
 
 
 
 
 
Net income
$
4,627

 
5,193

 
4,201

 
2,738

 
2,713

Add: merger-related expenses, net of tax
53

 
148

 
274

 
710

 
621

Adjusted net income
$
4,680

 
5,341

 
4,475

 
3,448

 
3,334

Basic adjusted earnings per share
0.36

 
0.41

 
0.34

 
0.31

 
0.33

Diluted adjusted earnings per share
0.36

 
0.41

 
0.34

 
0.31

 
0.33

Adjusted return on average assets
1.16
 %
 
1.30
 %
 
1.09
%
 
0.98
%
 
1.05
 %
Adjusted return on average equity
8.57
 %
 
9.82
 %
 
8.27
%
 
8.13
%
 
9.01
 %





LCNB CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS

(Dollars in thousands)
 
March 31, 2019 (Unaudited)
 
December 31, 2018
ASSETS:
 
 
 
Cash and due from banks
$
14,358

 
18,310

Interest-bearing demand deposits
5,169

 
1,730

Total cash and cash equivalents
19,527

 
20,040

Interest-bearing time deposits
747

 
996

Investment securities:
 

 
 

Equity securities with a readily determinable fair value, at fair value
2,185

 
2,078

Equity securities without a readily determinable fair value, at cost
2,099

 
2,099

Debt securities, available-for-sale, at fair value
217,668

 
238,421

Debt securities, held-to-maturity, at cost
32,363

 
29,721

Federal Reserve Bank stock, at cost
4,652

 
4,653

Federal Home Loan Bank stock, at cost
4,845

 
4,845

Loans, net
1,203,008

 
1,194,577

Premises and equipment, net
32,548

 
32,627

Operating leases right of use asset
5,348

 

Goodwill
59,221

 
59,221

Core deposit and other intangibles
4,760

 
5,042

Bank owned life insurance
28,905

 
28,723

Other assets
14,511

 
13,884

TOTAL ASSETS
$
1,632,387

 
1,636,927

 
 
 
 
LIABILITIES:
 

 
 

Deposits:
 

 
 

Noninterest-bearing
$
330,324

 
322,571

Interest-bearing
1,017,533

 
978,348

Total deposits
1,347,857

 
1,300,919

Short-term borrowings

 
56,230

Long-term debt
42,982

 
47,032

Operating leases liability
5,289

 

Accrued interest and other liabilities
12,241

 
13,761

TOTAL LIABILITIES
1,408,369

 
1,417,942

 
 
 
 
COMMITMENTS AND CONTINGENT LIABILITIES

 

 
 
 
 
SHAREHOLDERS' EQUITY:
 

 
 

Preferred shares – no par value, authorized 1,000,000 shares, none outstanding

 

Common shares – no par value, authorized 19,000,000 shares at March 31, 2019 and December 31, 2018; issued 14,089,175 and 14,070,303 shares at March 31, 2019 and December 31, 2018, respectively
141,349

 
141,170

Retained earnings
96,912

 
94,547

Treasury shares at cost, 775,027 at March 31, 2019 and December 31, 2018
(12,013
)
 
(12,013
)
Accumulated other comprehensive loss, net of taxes
(2,230
)
 
(4,719
)
TOTAL SHAREHOLDERS' EQUITY
224,018

 
218,985

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
$
1,632,387

 
1,636,927









LCNB CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
(Unaudited)
 
Three Months Ended 
March 31,
 
2019
 
2018
INTEREST INCOME:
 
 
 
Interest and fees on loans
$
14,538

 
9,413

Dividends on equity securities with a readily determinable fair value
17

 
15

Dividends on equity securities without a readily determinable fair value
16

 
7

Interest on debt securities, taxable
869

 
931

Interest on debt securities, non-taxable
544

 
704

Other short-term investments
129

 
72

TOTAL INTEREST INCOME
16,113

 
11,142

INTEREST EXPENSE:
 

 
 

Interest on deposits
2,286

 
871

Interest on short-term borrowings
219

 
69

Interest on long-term debt
217

 
14

TOTAL INTEREST EXPENSE
2,722

 
954

NET INTEREST INCOME
13,391

 
10,188

PROVISION FOR LOAN LOSSES
(105
)
 
79

NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES
13,496

 
10,109

NON-INTEREST INCOME:
 

 
 

Fiduciary income
1,034

 
964

Service charges and fees on deposit accounts
1,308

 
1,305

Net gains (losses) on sales of debt securities
(18
)
 

Bank owned life insurance income
182

 
186

Gains from sales of loans
29

 
22

Other operating income
237

 
159

TOTAL NON-INTEREST INCOME
2,772

 
2,636

NON-INTEREST EXPENSE:
 

 
 

Salaries and employee benefits
6,162

 
4,977

Equipment expenses
266

 
253

Occupancy expense, net
763

 
727

State financial institutions tax
438

 
303

Marketing
302

 
132

Amortization of intangibles
257

 
185

FDIC insurance premiums
126

 
99

Contracted services
464

 
315

Other real estate owned
3

 
2

Merger-related expenses
67

 
758

Other non-interest expense
1,852

 
1,798

TOTAL NON-INTEREST EXPENSE
10,700

 
9,549

INCOME BEFORE INCOME TAXES
5,568

 
3,196

PROVISION FOR INCOME TAXES
941

 
483

NET INCOME
$
4,627

 
2,713

 
 
 
 
Dividends declared per common share
$
0.17

 
0.16

Earnings per common share:
 

 
 

Basic
0.35

 
0.27

Diluted
0.35

 
0.27

Weighted average common shares outstanding:
 
 
 
Basic
13,283,634

 
10,020,611

Diluted
13,287,338

 
10,028,588







Contacts
LCNB Corp.
Steve P. Foster, CEO, 800-344-BANK
Robert C. Haines II, Executive Vice President and CFO, 800-344-BANK