ex_719181.htm

EX-99.2 3 ex_719181.htm EXHIBIT 99.2 ex_719181.htm

Exhibit 99.2

LCNB Corp. and Subsidiaries

Financial Highlights

(Dollars in thousands, except per share amounts)

(Unaudited)

	Three Months Ended															Nine Months Ended
	9/30/2024			6/30/2024			3/31/2024			12/31/2023			9/30/2023			9/30/2024			9/30/2023
Condensed Income Statement
Interest income	$	26,398			26,965			24,758			23,310			19,668			78,121			56,289
Interest expense		11,428			11,748			10,863			8,651			6,097			34,039			14,599
Net interest income		14,970			15,217			13,895			14,659			13,571			44,082			41,690
Provision for (recovery of) credit losses		660			528			125			2,218			(114	)		1,313			(141	)
Net interest income after provision for (recovery of) credit losses		14,310			14,689			13,770			12,441			13,685			42,769			41,831
Non-interest income		6,407			4,080			3,929			4,606			3,578			14,416			10,805
Non-interest expense		15,387			17,825			15,472			17,576			12,244			48,684			36,847
Income (loss) before income taxes		5,330			944			2,227			(529	)		5,019			8,501			15,789
Provision for (benefit from) income taxes		798			19			312			(236	)		949			1,129			2,868
Net income (loss)	$	4,532			925			1,915			(293	)		4,070			7,372			12,921

Supplemental Income Statement Information
Accretion income on acquired loans	$	800			1,248			776			410			—			2,824			75
Amortization expenses on acquired interest-bearing liabilities	$	378			638			459			309			—			1,475			—
Tax-equivalent net interest income	$	15,013			15,256			13,933			14,703			13,617			44,202			41,829
Pre-provision, pre-tax net income	$	5,990			1,472			2,352			1,689			4,905			9,814			15,648

Per Share Data
Dividends per share	$	0.22			0.22			0.22			0.22			0.21			0.66			0.63
Basic earnings (loss) per common share	$	0.31			0.07			0.15			(0.02	)		0.37			0.53			1.16
Diluted earnings (loss) per common share	$	0.31			0.07			0.15			(0.02	)		0.37			0.53			1.16
Book value per share	$	17.95			17.33			17.67			17.86			18.10			17.95			18.10
Tangible book value per share	$	10.97			10.08			11.26			11.42			12.72			10.97			12.72
Weighted average common shares outstanding:
Basic		14,103,358			14,033,264			13,112,302			12,378,289			11,038,720			13,761,582			11,094,185
Diluted		14,103,358			14,033,264			13,112,302			12,378,289			11,038,720			13,761,582			11,094,185
Shares outstanding at period end		14,110,210			14,151,755			13,224,276			13,173,569			11,123,382			14,110,210			11,123,382

Selected Financial Ratios
Return on average assets		0.76	%		0.15	%		0.34	%		(0.05	)%		0.82	%		0.42	%		0.89	%
Return on average equity		7.23	%		1.53	%		3.28	%		(0.53	)%		7.92	%		4.06	%		8.49	%
Return on average tangible common equity		9.49	%		2.02	%		4.39	%		(0.72	)%		11.21	%		5.37	%		12.04	%
Dividend payout ratio		70.97	%		314.29	%		146.67	%		NM			56.76	%		124.53	%		54.31	%
Net interest margin (tax equivalent)		2.84	%		2.86	%		2.72	%		2.99	%		3.04	%		2.81	%		3.20	%
Efficiency ratio (tax equivalent)		71.83	%		92.19	%		86.62	%		91.02	%		71.21	%		83.05	%		70.01	%

Selected Balance Sheet Items
Cash and cash equivalents	$	39,374		$	34,872		$	32,951		$	39,723			43,422
Debt and equity securities		313,545			312,241			306,775			318,723			309,094

Loans:
Commercial and industrial	$	119,079		$	125,703		$	122,229		$	120,411			125,751
Commercial, secured by real estate		1,105,405			1,117,798			1,099,601			1,107,556			981,787
Residential real estate		459,740			458,949			398,250			459,073			313,286
Consumer		22,088			22,912			24,137			25,578			27,018
Agricultural		13,113			11,685			12,647			10,952			11,278
Other, including deposit overdrafts		496			233			73			82			80
Deferred net origination fees		(861	)		(533	)		(583	)		(181	)		(796	)
Loans, gross		1,719,060			1,736,747			1,656,354			1,723,471			1,458,404
Less allowance for credit losses		11,867			11,270			10,557			10,525			7,932
Loans, net	$	1,707,193		$	1,725,477		$	1,645,797		$	1,712,946			1,450,472

Loans held for sale	$	35,687			44,002			75,581			—			—

NM - Not Meaningful

	Three Months Ended															Nine Months Ended
	9/30/2024			6/30/2024			3/31/2024			12/31/2023			9/30/2023			9/30/2024			9/30/2023
Selected Balance Sheet Items, continued

Allowance for Credit Losses on Loans:
Allowance for credit losses, beginning of period	$	11,270			10,557			10,525			7,932			7,956
Fair value adjustment for purchased credit deteriorated loans		—			189			—			493			—
Provision for credit losses on loans		681			542			77			2,203			9
Losses charged off		(122	)		(87	)		(78	)		(126	)		(57	)
Recoveries		38			69			33			23			24
Allowance for credit losses, end of period	$	11,867			11,270			10,557			10,525			7,932

Total earning assets	$	2,044,318			2,058,110			1,971,130			2,045,382		$	1,787,796
Total assets		2,346,908			2,371,313			2,283,151			2,291,592			1,981,668
Total deposits		1,917,005			1,943,060			1,858,493			1,824,389			1,616,890
Short-term borrowings		—			—			10,000			97,395			30,000
Long-term debt		155,662			162,150			162,638			113,123			112,641
Total shareholders’ equity		253,246			245,214			233,663			235,303			201,349
Equity to assets ratio		10.79	%		10.34	%		10.23	%		10.27	%		10.16	%
Loans to deposits ratio		89.67	%		89.38	%		89.12	%		94.47	%		90.20	%

Tangible common equity (TCE)	$	154,728			142,679			145,850			146,999		$	141,508
Tangible common assets (TCA)		2,248,390			2,268,778			2,195,338			2,203,288			1,921,827
TCE/TCA		6.88	%		6.29	%		6.64	%		6.67	%		7.36	%

Selected Average Balance Sheet Items
Cash and cash equivalents	$	39,697			39,396			51,366			49,436			36,177			43,486			34,234
Debt and equity securities		314,255			309,668			310,771			310,274			313,669			311,551			320,706

Loans, including loans held for sale	$	1,770,330			1,818,253			1,722,568			1,622,911			1,451,153			1,770,383			1,415,719
Less allowance for credit losses on loans		11,281			11,386			10,523			8,826			7,958			11,064			7,782
Net loans	$	1,759,049			1,806,867			1,712,045			1,614,085			1,443,195			1,759,319			1,407,937

Total earning assets, including loans held for sale	$	2,099,954		$	2,142,064		$	2,056,656		$	1,952,121			1,775,713			2,099,536			1,747,476
Total assets		2,365,676			2,404,782			2,294,766			2,182,477			1,971,269			2,355,113			1,940,591
Total deposits		1,936,601			1,965,987			1,824,546			1,759,677			1,610,508			1,909,146			1,599,668
Short-term borrowings		11			11,291			65,052			64,899			63,018			25,358			78,916
Long-term debt		158,419			162,555			150,177			115,907			72,550			157,056			36,878
Total shareholders’ equity		249,370			243,927			235,119			220,678			203,967			242,829			203,496
Equity to assets ratio		10.54	%		10.14	%		10.25	%		10.11	%		10.35	%		10.31	%		10.49	%
Loans to deposits ratio		91.41	%		92.49	%		94.41	%		92.23	%		90.11	%		92.73	%		88.50	%

Asset Quality
Net charge-offs	$	84			18			45			102			33			147			82
Other real estate owned		—			—			—			—			—			—			—

Non-accrual loans	$	3,001			2,845			2,719			80			85			3,001			85
Loans past due 90 days or more and still accruing		283			159			524			72			176			283			176
Total nonperforming loans	$	3,284			3,004			3,243			152			261			3,284			261

Net charge-offs to average loans		0.02	%		—	%		0.01	%		0.02	%		0.01	%		0.01	%		0.01	%
Allowance for credit losses on loans to total loans		0.69	%		0.65	%		0.64	%		0.61	%		0.54	%
Nonperforming loans to total loans		0.19	%		0.17	%		0.20	%		0.01	%		0.02	%
Nonperforming assets to total assets		0.14	%		0.13	%		0.14	%		0.01	%		0.01	%

	Three Months Ended															Nine Months Ended
	9/30/2024			6/30/2024			3/31/2024			12/31/2023			9/30/2023			9/30/2024			9/30/2023
Assets Under Management
LCNB Corp. total assets	$	2,346,908			2,371,313			2,283,151			2,291,592			1,981,668
Trust and investments (fair value)		933,341			897,746			890,800			806,770			731,342
Mortgage loans serviced		366,175			422,951			386,490			391,800			146,483
Cash management		165,218			93,842			13,314			2,375			2,445
Brokerage accounts (fair value)		435,611			419,646			411,211			392,390			368,854
Total assets managed	$	4,247,253			4,205,498			3,984,966			3,884,927			3,230,792

Reconciliation of Net Income Less Tax-Effected Merger-Related Costs
Net income (loss)	$	4,532			925			1,915			(293	)		4,070			7,372			12,921
Merger expenses		281			2,320			775			3,914			302			3,376			742
Provision for credit losses on non-PCD loans		—			763			—			1,722			—			763			—
Loss on sale of below-market acquired loans		—			843			—			—			—			843			—
Tax effect		(48	)		(773	)		(90	)		(1,102	)		(3	)		(911	)		(83	)
Adjusted net income	$	4,765			4,078			2,600			4,241			4,369			11,443			13,580

Adjusted basic and diluted earnings per share	$	0.34		$	0.29		$	0.20		$	0.34			0.40			0.83			1.22
Adjusted return on average assets		0.80	%		0.68	%		0.46	%		0.77	%		0.88	%		0.65	%		0.94	%
Adjusted return on average equity		7.60	%		6.72	%		4.45	%		7.62	%		8.50	%		6.29	%		8.92	%

	Three Months Ended September 30,																	Three Months Ended June 30,
	2024									2023								2024
	Average			Interest			Average			Average			Interest		Average			Average			Interest		Average
	Outstanding			Earned/			Yield/			Outstanding			Earned/		Yield/			Outstanding			Earned/		Yield/
	Balance			Paid			Rate			Balance			Paid		Rate			Balance			Paid		Rate
Loans (1)	$	1,770,330			24,342			5.47	%	$	1,451,153			17,875		4.89	%	$	1,818,253			24,836		5.49	%
Interest-bearing demand deposits		15,369			209			5.41	%		10,891			152		5.54	%		14,143			215		6.11	%
Federal Reserve Bank stock		6,393			(1	)		(0.06	)%		4,652			—		—	%		6,248			180		11.59	%
Federal Home Loan Bank stock		20,710			464			8.91	%		7,007			134		7.59	%		20,152			367		7.32	%
Investment securities:
Equity securities		5,026			40			3.17	%		3,382			38		4.46	%		4,985			39		3.15	%
Debt securities, taxable		262,220			1,181			1.79	%		274,494			1,296		1.87	%		259,768			1,183		1.83	%
Debt securities, non-taxable (2)		19,906			206			4.12	%		24,134			219		3.60	%		18,515			184		4.00	%
Total earnings assets		2,099,954			26,441			5.01	%		1,775,713			19,714		4.40	%		2,142,064			27,004		5.07	%
Non-earning assets		277,003									203,514								274,104
Allowance for credit losses		(11,281	)								(7,958	)							(11,386	)
Total assets	$	2,365,676								$	1,971,269							$	2,404,782

Interest-bearing demand and money market deposits	$	585,823			3,006			2.04	%	$	541,487			2,298		1.68	%	$	648,772			3,575		2.22	%
Savings deposits		367,045			274			0.30	%		379,515			129		0.13	%		372,240			307		0.33	%
IRA and time certificates		538,070			6,298			4.66	%		230,030			1,999		3.45	%		493,297			5,808		4.74	%
Short-term borrowings		11			—			0.00	%		63,018			830		5.23	%		11,291			181		6.45	%
Long-term debt		158,419			1,850			4.65	%		72,550			841		4.60	%		162,555			1,877		4.64	%
Total interest-bearing liabilities		1,649,368			11,428			2.76	%		1,286,600			6,097		1.88	%		1,688,155			11,748		2.80	%
Demand deposits		445,663									459,476								451,678
Other liabilities		21,275									21,226								21,022
Equity		249,370									203,967								243,927
Total liabilities and equity	$	2,365,676								$	1,971,269							$	2,404,782
Net interest rate spread (3)								2.25	%							2.52	%							2.27	%
Net interest income and net interest margin on a taxable-equivalent basis (4)					15,013			2.84	%					13,617		3.04	%					15,256		2.86	%
Ratio of interest-earning assets to interest-bearing liabilities		127.32	%								138.02	%							126.89	%

	(1)	Includes non-accrual loans and loans held for sale
	(2)	Income from tax-exempt securities is included in interest income on a taxable-equivalent basis. Interest income has been divided by a factor comprised of the complement of the incremental tax rate of 21%.
	(3)	The net interest spread is the difference between the average rate on total interest-earning assets and interest-bearing liabilities.
	(4)	The net interest margin is the taxable-equivalent net interest income divided by average interest-earning assets.

	For the Nine Months Ended September 30,
	2024			2023
	Average	Interest	Average	Average	Interest	Average
	Outstanding	Earned/	Yield/	Outstanding	Earned/	Yield/
	Balance	Paid	Rate	Balance	Paid	Rate
Loans (1)	$ 1,770,383	71,860	5.42%	$ 1,415,719	50,781	4.80%
Interest-bearing demand deposits	17,602	747	5.67%	11,051	453	5.48%
Federal Reserve Bank stock	6,051	176	3.89%	4,652	140	4.02%
Federal Home Loan Bank stock	19,040	1,172	8.22%	6,840	317	6.20%
Investment securities:
Equity securities	5,002	119	3.18%	3,698	113	4.09%
Debt securities, taxable	262,360	3,596	1.83%	280,998	3,962	1.89%
Debt securities, non-taxable (2)	19,098	571	3.99%	24,518	662	3.61%
Total earnings assets	2,099,536	78,241	4.98%	1,747,476	56,428	4.32%
Non-earning assets	266,641			200,897
Allowance for credit losses	(11,064)			(7,782)
Total assets	$ 2,355,113			$ 1,940,591

Interest-bearing demand and money market deposits	$ 625,785	10,498	2.24%	$ 522,896	5,140	1.31%
Savings deposits	369,104	787	0.28%	396,785	402	0.14%
IRA and time certificates	467,425	16,173	4.62%	210,407	4,675	2.97%
Short-term borrowings	25,358	1,116.00	5.88%	78,916	3,142	5.32%
Long-term debt	157,056	5,465	4.65%	36,878	1,240	4.50%
Total interest-bearing liabilities	1,644,728	34,039	2.76%	1,245,882	14,599	1.57%
Demand deposits	446,832			469,580
Other liabilities	20,724			21,633
Equity	242,829			203,496
Total liabilities and equity	$ 2,355,113			$ 1,940,591
Net interest rate spread (3)			2.22%			2.75%
Net interest income and net interest margin on a taxable-equivalent basis (4)		44,202	2.81%		41,829	3.20%
Ratio of interest-earning assets to interest-bearing liabilities	127.65%			140.26%

	(1)	Includes non-accrual loans and loans held for sale
	(2)	Income from tax-exempt securities is included in interest income on a taxable-equivalent basis. Interest income has been divided by a factor comprised of the complement of the incremental tax rate of 21%.
	(3)	The net interest spread is the difference between the average rate on total interest-earning assets and interest-bearing liabilities.
	(4)	The net interest margin is the taxable-equivalent net interest income divided by average interest-earning assets.

Exhibit 99.2

LCNB CORP. AND SUBSIDIARIES

CONSOLIDATED CONDENSED BALANCE SHEETS

(Unaudited, dollars in thousands)

	September 30, 2024			December 31, 2023
	Unaudited			Audited
ASSETS:
Cash and due from banks	$	27,661		$	36,535
Interest-bearing demand deposits		11,713			3,188
Total cash and cash equivalents		39,374			39,723
Investment securities:
Equity securities with a readily determinable fair value, at fair value	$	1,388		$	1,336
Equity securities without a readily determinable fair value, at cost		3,666			3,666
Debt securities, available-for-sale, at fair value		262,622			276,601
Debt securities, held-to-maturity, at cost, net of allowance for credit losses of $7 and $5 at September 30, 2024 and December 31, 2023, respectively		18,730			16,858
Federal Reserve Bank stock, at cost		6,429			5,086
Federal Home Loan Bank stock, at cost		20,710			15,176
Loans, net of allowance for credit losses of $11,867 and $10,525 at September 30, 2024 and December 31, 2023, respectively		1,707,193			1,712,946
Loans held for sale		35,687			—
Premises and equipment, net		41,233			36,302
Operating lease right-of-use assets		5,853			6,000
Goodwill		90,209			79,509
Core deposit and other intangibles, net		11,605			9,494
Bank-owned life insurance		53,650			49,847
Interest receivable		9,450			8,405
Other assets, net		39,109			30,643
TOTAL ASSETS		2,346,908			2,291,592

LIABILITIES:
Deposits:
Noninterest-bearing	$	446,626		$	462,267
Interest-bearing		1,470,379			1,362,122
Total deposits		1,917,005			1,824,389
Short-term borrowings		—			97,395
Long-term debt		155,662			113,123
Operating lease liabilities		6,152			6,261
Accrued interest and other liabilities		14,843			15,121
TOTAL LIABILITIES		2,093,662			2,056,289

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 17,321,593 and 16,384,952 shares at September 30, 2024 and December 31, 2023, respectively; outstanding 14,110,210 and 13,173,569 shares at September 30, 2024 and December 31, 2023, respectively		186,716			173,637
Retained earnings		138,325			140,017
Treasury shares at cost, 3,211,383 and 3,211,383 shares at September 30, 2024 and December 31, 2023, respectively		(56,015	)		(56,015	)
Accumulated other comprehensive loss, net of taxes		(15,780	)		(22,336	)
TOTAL SHAREHOLDERS' EQUITY		253,246			235,303
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	2,346,908		$	2,291,592

Exhibit 99.2

LCNB CORP. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF INCOME

(Dollars in thousands, except per share data)

(Unaudited)

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2024		2023			2024			2023
INTEREST INCOME:
Interest and fees on loans	$	24,342		17,875		$	71,860			50,781
Dividends on equity securities:
With a readily determinable fair value		10		9			28			34
Without a readily determinable fair value		30		29			91			79
Interest on debt securities:
Taxable		1,181		1,296			3,596			3,962
Non-taxable		163		173			451			523
Other investments		672		286			2,095			910
TOTAL INTEREST INCOME		26,398		19,668			78,121			56,289

INTEREST EXPENSE:
Interest on deposits		9,578		4,426			27,458			10,217
Interest on short-term borrowings		—		830			1,116			3,142
Interest on long-term debt		1,850		841			5,465			1,240
TOTAL INTEREST EXPENSE		11,428		6,097			34,039			14,599
NET INTEREST INCOME		14,970		13,571			44,082			41,690

PROVISION FOR (RECOVERY OF) CREDIT LOSSES		660		(114	)		1,313			(141	)
NET INTEREST INCOME AFTER PROVISION FOR (RECOVERY OF) CREDIT LOSSES		14,310		13,685			42,769			41,831

NON-INTEREST INCOME:
Fiduciary income		2,097		1,736			6,137			5,263
Service charges and fees on deposit accounts		1,899		1,397			4,820			4,324
Net losses from sales of debt securities, available-for-sale		—		—			(214	)		—
Bank-owned life insurance income		654		282			1,313			830
Net gains from sales of loans		1,625		29			2,197			38
Other operating income		132		134			163			350
TOTAL NON-INTEREST INCOME		6,407		3,578			14,416			10,805

NON-INTEREST EXPENSE:
Salaries and employee benefits		9,025		7,044			26,585			21,454
Equipment expenses		420		397			1,205			1,175
Occupancy expense, net		966		805			2,915			2,367
State financial institutions tax		505		396			1,409			1,189
Marketing		320		223			704			735
Amortization of intangibles		304		113			838			336
FDIC insurance premiums, net		547		224			1,445			663
Contracted services		807		671			2,435			1,978
Merger-related expenses		281		302			3,376			742
Other non-interest expense		2,212		2,069			7,772			6,208
TOTAL NON-INTEREST EXPENSE		15,387		12,244			48,684			36,847
INCOME BEFORE INCOME TAXES		5,330		5,019			8,501			15,789
PROVISION FOR INCOME TAXES		798		949			1,129			2,868
NET INCOME	$	4,532		4,070		$	7,372			12,921

Earnings per common share:
Basic		0.31		0.37			0.53			1.16
Diluted		0.31		0.37			0.53			1.16
Weighted average common shares outstanding:
Basic		14,103,358		11,038,720			13,761,582			11,094,185
Diluted		14,103,358		11,038,720			13,761,582			11,094,185