Message #7 From:
NewsBot Date: July 17, 2006 03:33:00 PM
LCNB News LCNB Corp. Reports Financial Results for the Six Months Ended June 30, 2006
LEBANON, Ohio--(BUSINESS WIRE)--July 17, 2006--LCNB Corp. (OTCBB:LCNB) today announced earnings of $3,218,000, or $0.99 basic earnings per share, for the six months ended June 30, 2006, compared to $3,098,000, or $0.93 basic earnings per share, for the first six months of 2005. Return on average assets for the six months ended June 30, 2006 and 2005 were 1.20% and 1.18%, respectively. Return on average equity for the first half of 2006 was 12.41%, compared to 11.92% for the first half of 2005.
The increase in net income during the first half, 2006 was significantly influenced by:
-- a $182,000 decrease in the provision for loan losses;
-- a $198,000 increase in trust and brokerage income, partly from new business and partly from fee modifications; and
-- a $128,000 increase in insurance agency income recognized by Dakin Insurance Agency, primarily from an increase in contingency income and new business.
Net interest income for the first half of 2006 decreased $44,000, or 0.5%, as compared to the first half of 2005. The decrease was primarily due to a 70 basis point (a basis point equals 0.01%) increase in the average rate paid for deposit accounts. This increase is primarily due to a general increase in market rates. Partially offsetting the increase in deposit rates were a $25.0 million increase in the total loan portfolio and a 32 basis point increase in the average rate earned by the loan portfolio. Total loans increased from $348.5 million at June 30, 2005 to $373.5 million at June 30, 2006, primarily due to growth in the commercial loan portfolio. The increase in the average rate earned was due primarily to a general increase in market rates.
The allowance for loan losses at June 30, 2006 was $2,051,000, which was $103,000 less than at June 30, 2005. The decrease was primarily due to an improvement in the credit quality of one significant loan during the first half of 2006. This reduction and a lower amount of net charge-offs during the 2006 period account for the $182,000, or 84.3%, reduction in the provision for loan losses for the first half of 2006 as compared to the first half of 2005.
Non-interest income of $4,139,000 for the first half of 2006 was $378,000, or 10.1%, greater than for the same period in 2005 primarily due to the increases in trust, brokerage, and insurance agency income previously mentioned. Service charges and fees also increased $64,000 primarily due to an increase in check card income, which grew because a greater number of cards were outstanding and because of the increasing popularity of check cards as a retail payment method.
Non-interest expense of $8,962,000 for the first six months of 2006 was $333,000, or 3.9%, greater than for the first six months of 2005, primarily due to increases in salaries and wages and ATM expenses.
LCNB Corp. is a financial holding company headquartered in Lebanon, Ohio. Affiliates of LCNB Corp. are Lebanon Citizens National Bank, with 21 offices located in Warren, Butler, Clinton, Clermont, and Hamilton Counties, Ohio, and Dakin Insurance Agency, Inc. Additional information about LCNB Corp. and information about products and services offered by Lebanon Citizens National Bank and Dakin Insurance Agency can be found on the internet at www.lcnb.com and www.dakin-ins.com.
Certain matters disclosed herein may be deemed to be forward-looking statements that involve risks and uncertainties, including regulatory policy changes, interest rate fluctuations, loan demand, loan delinquencies and losses, and other risks. Actual strategies and results in future time periods may differ materially from those currently expected. Such forward-looking statements represent management's judgment as of the current date. LCNB Corp. disclaims any intent or obligation to update such forward-looking statements. LCNB intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.
LCNB Corp. and Subsidiaries
Financial Highlights
For the Six Months Ended June 30,
(Dollars in thousands, except per share amounts)
%
2006 2005 Change
Condensed Income Statement
Interest income $ 14,795 13,385 10.53%
Interest expense 5,638 4,184 34.75%
---------- ----------
Net interest income 9,157 9,201 -0.48%
Provision for loan losses 34 216 -84.26%
---------- ----------
Net interest income after provision 9,123 8,985 1.54%
Non-interest income 4,139 3,761 10.05%
Non-interest expense 8,962 8,629 3.86%
---------- ----------
Income before income taxes 4,300 4,117 4.44%
Provision for income taxes 1,082 1,019 6.18%
---------- ----------
Net income $ 3,218 3,098 3.87%
========== ==========
Basic earnings per common share $ 0.99 0.93 6.45%
========== ==========
Dividends per common share $ 0.60 0.58 3.45%
========== ==========
Average basic shares outstanding 3,261,945 3,319,482
========== ==========
Selected Balance Sheet Items
Investment securities $ 115,303 144,171 -20.02%
Loans 373,503 348,482 7.18%
Less allowance for loan losses 2,051 2,154 -4.78%
---------- ----------
Net loans 371,452 346,328 7.25%
Total assets 546,081 543,100 0.55%
Total deposits 490,910 485,530 1.11%
Long-term debt 40 2,105 -98.10%
Total shareholders' equity 51,916 51,966 -0.10%
Book value per share $ 15.96 $ 15.72 1.53%
Shares outstanding at period end 3,253,608 3,305,508
Selected Financial Ratios
Return on average assets 1.20% 1.18% 1.69%
Return on average equity 12.41% 11.92% 4.11%
Equity to assets ratio 9.51% 9.57% -0.63%
Dividend payout ratio 60.61% 62.37% -2.82%
Net interest margin (a) 3.92% 4.01% -2.24%
(a) tax-equivalent basis
Assets Under Management
LCNB Corp. total assets $ 546,081 543,100 0.55%
Trust and investments (b) 199,068 190,759 4.36%
Mortgage loans serviced 44,819 46,087 -2.75%
Business cash management 30,148 23,540 28.07%
Brokerage accounts (b) 42,954 30,931 38.87%
---------- ----------
Total assets managed $ 863,070 834,417 3.43%
========== ==========
(b) at fair market value
