LCNB CORP - FORM 8-K - EX-99.2 - October 20, 2020

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Exhibit 99.2

LCNB Corp. and Subsidiaries
Financial Highlights
(Dollars in thousands, except per share amounts)
(Unaudited)
Three Months Ended
Nine Months Ended
9/30/2020
6/30/2020
3/31/2020
12/31/2019
9/30/2019
9/30/2020
9/30/2019
Condensed Income Statement
Interest income
$15,322 15,957 16,556 16,424 16,329 47,835 48,770 
Interest expense
1,793 1,959 2,378 2,577 2,751 6,130 8,211 
Net interest income
13,529 13,998 14,178 13,847 13,578 41,705 40,559 
Provision (credit) for loan losses
976 16 1,173 (6)264 2,165 213 
Net interest income after provision
12,553 13,982 13,005 13,853 13,314 39,540 40,346 
Non-interest income
4,278 3,319 3,839 3,222 3,356 11,436 9,126 
Non-interest expense
11,653 11,116 11,072 11,007 10,982 33,841 32,515 
Income before income taxes
5,178 6,185 5,772 6,068 5,688 17,135 16,957 
Provision for income taxes
928 1,128 746 1,238 961 2,802 2,875 
Net income
$4,250 5,057 5,026 4,830 4,727 14,333 14,082 
Amort/Accret income on acquired loans
$181 294 667 400 302 1,142 881 
Amort/Accret expenses on acquired interest-bearing liabilities
$— 2 3 3 4 5 290 
Tax-equivalent net interest income
$13,594 14,066 14,254 13,937 13,679 41,914 40,915 
Per Share Data
Dividends per share
$0.18 0.18 0.18 0.18 0.17 0.54 0.51 
Basic earnings per common share
$0.33 0.39 0.39 0.37 0.36 1.11 1.07 
Diluted earnings per common share
$0.33 0.39 0.39 0.37 0.36 1.11 1.07 
Book value per share
$18.46 18.27 18.00 17.63 17.44 18.46 17.44 
Tangible book value per share
$13.66 13.47 13.18 12.78 12.57 13.66 12.57 
Weighted average common shares outstanding:
Basic
12,937,865 12,940,975 12,926,077 12,912,106 12,932,950 12,934,987 13,135,134 
Diluted
12,937,901 12,941,001 12,927,666 12,916,000 12,937,145 12,935,388 13,139,100 
Shares outstanding at period end
12,926,686 12,975,879 12,969,076 12,936,783 12,927,463 12,926,686 12,927,463 
Selected Financial Ratios
Return on average assets
0.97 %1.19 %1.23 %1.17 %1.13 %1.13 %1.15 %
Return on average equity
7.08 %8.63 %8.75 %8.42 %8.33 %8.14 %8.42 %
Return on average tangible equity9.56 %11.74 %12.00 %11.63 %11.57 %11.07 %11.75 %
Dividend payout ratio
54.55 %46.15 %46.15 %48.65 %47.22 %48.65 %47.66 %
Net interest margin (tax equivalent)
3.47 %3.70 %3.92 %3.76 %3.67 %3.69 %3.70 %
Efficiency ratio (tax equivalent)
65.20 %63.94 %61.19 %64.15 %64.47 %63.43 %64.98 %
Selected Balance Sheet Items
Cash and cash equivalents
$24,485 42,736 24,795 20,765 22,826 
Debt and equity securities
199,044 194,883 183,123 219,791 239,730 
Loans:
Commercial and industrial
$124,628 125,492 85,356 78,306 71,576 
Commercial, secured by real estate
843,943 833,286 829,461 804,953 797,842 
Residential real estate
327,689 334,349 318,009 322,533 320,703 
Consumer
36,504 32,859 28,955 25,232 23,918 
  Agricultural
8,920 11,071 10,519 11,509 11,525 
Other, including deposit overdrafts
403 283 436 1,193 456 
Deferred net origination fees
(1,927)(1,902)(349)(275)(128)                                                               
  Loans, gross
1,340,160 1,335,438 1,272,387 1,243,451 1,225,892 
Less allowance for loan losses
5,974 5,016 5,008 4,045 4,167 
  Loans, net
$1,334,186 1,330,422 1,267,379 1,239,406 1,221,725 
Total earning assets
$1,547,538 1,554,537 1,462,485 1,466,988 1,470,074 
Total assets
1,725,615 1,735,332 1,636,280 1,639,308 1,644,447 
Total deposits
1,430,394 1,438,921 1,345,872 1,348,280 1,355,383 


Three Months Ended
Nine Months Ended
9/30/20206/30/20203/31/202012/31/20199/30/20199/30/20209/30/2019
Selected Balance Sheet Items, continued
Long-term debt
31,999 33,998 35,996 40,994 41,990 
Total shareholders’ equity
238,585 237,047 233,478 228,048 225,492 
Equity to assets ratio
13.83 %13.66 %14.27 %13.91 %13.71 %
Loans to deposits ratio
93.69 %92.81 %94.54 %92.22 %90.45 %
Tangible common equity (TCE)
$176,624 174,823 170,994 165,304 162,485 
Tangible common assets (TCA)
1,663,654 1,673,108 1,573,796 1,576,564 1,581,440 
TCE/TCA
10.62 %10.45 %10.87 %10.49 %10.27 %
Selected Average Balance Sheet Items
Cash and cash equivalents
$42,661 46,292 25,101 26,501 28,293 37,988 27,600 
Debt and equity securities
197,788 182,371 204,912 231,115 243,553 195,033 253,113 
Loans
$1,339,608 1,318,753 1,252,554 1,230,845 1,227,806 1,303,770 1,218,183 
Less allowance for loan losses
5,250 4,998 3,938 4,076 3,986 4,730 4,049 
Net loans
$1,334,358 1,313,755 1,248,616 1,226,769 1,223,820 1,299,040 1,214,134 
Total earning assets
$1,558,886 1,528,610 1,462,946 1,469,469 1,480,096 1,516,967 1,479,983 
Total assets
1,741,998 1,704,303 1,638,486 1,643,793 1,654,034 1,695,103 1,642,186 
Total deposits
1,445,573 1,412,082 1,346,770 1,352,101 1,365,702 1,401,636 1,350,678 
Short-term borrowings
0 82 1,415 622 468 497 7,898 
Long-term debt
33,020 34,964 38,325 41,742 41,988 35,427 43,067 
Total shareholders’ equity
238,990 235,587 231,058 227,595 225,216 235,225 223,644 
Equity to assets ratio
13.72 %13.82 %14.10 %13.85 %13.62 %13.88 %13.62 %
Loans to deposits ratio
92.67 %93.39 %93.00 %91.03 %89.90 %93.02 %90.19 %
Asset Quality
Net charge-offs
$18 8 210 115 209 236 92 
Other real estate owned
— — — 197 197 — 197 
Non-accrual loans
4,110 3,876 2,829 3,210 3,523 4,110 3,523 
Loans past due 90 days or more and still accruing
94 38 39 — — 94 — 
Total nonperforming loans
$4,204 3,914 2,868 3,210 3,523 4,204 3,523 
Net charge-offs to average loans
0.01 %0.00 %0.07 %0.04 %0.07 %0.02 %0.01 %
Allowance for loan losses to total loans
0.45 %0.38 %0.39 %0.33 %0.34 %0.45 %0.34 %
Nonperforming loans to total loans
0.31 %0.29 %0.23 %0.26 %0.29 %0.31 %0.29 %
Nonperforming assets to total assets
0.24 %0.23 %0.18 %0.21 %0.23 %0.24 %0.23 %
Assets Under Management
LCNB Corp. total assets
$1,725,615 1,735,332 1,636,280 1,639,308 1,644,447 
Trust and investments (fair value)
524,502 516,076 455,974 435,664 411,724 
Mortgage loans serviced
120,546 100,189 94,805 93,596 90,784 
Cash management
119,520 116,615 77,471 75,948 117,530 
Brokerage accounts (fair value)
267,307 255,276 235,278 268,059 262,038 
Total assets managed
$2,757,490 2,723,488 2,499,808 2,512,575 2,526,523 


LCNB CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS

(Dollars in thousands)
September 30, 2020 (Unaudited)December 31, 2019
ASSETS:
Cash and due from banks$16,151 17,019 
Interest-bearing demand deposits8,334 3,746 
Total cash and cash equivalents24,485 20,765 
Investment securities:  
Equity securities with a readily determinable fair value, at fair value2,213 2,312 
Equity securities without a readily determinable fair value, at cost2,099 2,099 
Debt securities, available-for-sale, at fair value157,936 178,000 
Debt securities, held-to-maturity, at cost26,941 27,525 
Federal Reserve Bank stock, at cost4,652 4,652 
Federal Home Loan Bank stock, at cost5,203 5,203 
Loans, net1,334,186 1,239,406 
Premises and equipment, net35,309 34,787 
Operating leases right of use asset5,729 5,444 
Goodwill59,221 59,221 
Core deposit and other intangibles3,539 4,006 
Bank owned life insurance41,871 41,667 
Interest receivable9,559 3,926 
Other assets12,672 10,295 
TOTAL ASSETS$1,725,615 1,639,308 
LIABILITIES:  
Deposits:  
Noninterest-bearing$426,989 354,391 
Interest-bearing1,003,405 993,889 
Total deposits1,430,394 1,348,280 
Long-term debt31,999 40,994 
Operating lease liabilities5,790 5,446 
Accrued interest and other liabilities18,847 16,540 
TOTAL LIABILITIES1,487,030 1,411,260 
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; issued 14,157,303 and 14,111,810 shares at September 30, 2020 and December 31, 2019, respectively; outstanding 12,926,686 and 12,936,783 shares at September 30, 2020 and December 31, 2019, respectively142,310 141,791 
Retained earnings111,760 104,431 
Treasury shares at cost, 1,230,617 and 1,175,027 shares at September 30, 2020 and December 31, 2019, respectively(19,639)(18,847)
Accumulated other comprehensive income, net of taxes4,154 673 
TOTAL SHAREHOLDERS' EQUITY238,585 228,048 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$1,725,615 1,639,308 




LCNB CORP. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
(Unaudited)
Three Months Ended September 30, Nine Months Ended 
September 30,
 2020201920202019
INTEREST INCOME:
Interest and fees on loans$14,379 14,872 44,428 44,072 
Dividends on equity securities with a readily determinable fair value13 15 40 47 
Dividends on equity securities without a readily determinable fair value5 16 33 48 
Interest on debt securities, taxable633 918 2,250 2,720 
Interest on debt securities, non-taxable249 379 788 1,340 
Interest on interest-bearing time deposits— 3 — 11 
Other investments43 126 296 532 
TOTAL INTEREST INCOME15,322 16,329 47,835 48,770 
INTEREST EXPENSE:    
Interest on deposits1,567 2,475 5,416 7,225 
Interest on short-term borrowings— 3 7 224 
Interest on long-term debt226 273 707 762 
TOTAL INTEREST EXPENSE1,793 2,751 6,130 8,211 
NET INTEREST INCOME13,529 13,578 41,705 40,559 
PROVISION FOR LOAN LOSSES976 264 2,165 213 
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES12,553 13,314 39,540 40,346 
NON-INTEREST INCOME:    
Fiduciary income1,275 1,123 3,579 3,215 
Service charges and fees on deposit accounts1,506 1,616 4,038 4,421 
Net gains (losses) on sales of debt securities— (20)221 (37)
Bank owned life insurance income275 289 1,163 654 
Gains from sales of loans999 114 1,436 207 
Other operating income223 234 999 666 
TOTAL NON-INTEREST INCOME4,278 3,356 11,436 9,126 
NON-INTEREST EXPENSE:    
Salaries and employee benefits6,863 6,403 20,279 18,808 
Equipment expenses341 322 917 866 
Occupancy expense, net740 751 2,145 2,258 
State financial institutions tax424 433 1,280 1,307 
Marketing471 410 906 1,009 
Amortization of intangibles263 263 783 780 
FDIC insurance premiums, net112 (13)142 225 
Contracted services435 455 1,312 1,394 
Other real estate owned2 1 (7)52 
Merger-related expenses— 27 — 114 
Other non-interest expense2,002 1,930 6,084 5,702 
TOTAL NON-INTEREST EXPENSE11,653 10,982 33,841 32,515 
INCOME BEFORE INCOME TAXES5,178 5,688 17,135 16,957 
PROVISION FOR INCOME TAXES928 961 2,802 2,875 
NET INCOME$4,250 4,727 14,333 14,082 
Dividends declared per common share$0.18 0.17 0.54 0.51 
Earnings per common share:   
Basic0.33 0.36 1.11 1.07 
Diluted0.33 0.36 1.11 1.07 
Weighted average common shares outstanding:
Basic12,937,865 12,932,950 12,934,987 13,135,134 
Diluted12,937,901 12,937,145 12,935,388 13,139,100 



Contacts
LCNB Corp.
Eric J. Meilstrup, CEO and President, 800-344-BANK
Robert C. Haines II, Executive Vice President and CFO, 800-344-BANK


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