LCNB Corp operates within the financial sector in the United States. As the holding company of the National Bank, it conducts the business of providing commercial and personal banking services. Its suite of banking products includes commercial and industrial loans, consumer loans, safe deposit boxes, night depositories, cashier's checks, utility bill collections, and notary public service. Besides, it provides the avenue of United States Treasury notes, the United States agency notes, certificates of deposit, and equity securities.
Performance Overview
LCNB Corp (LCNB, Financial) reported a net income of $0.9 million for the second quarter of 2024, a significant decline from $4.7 million in the same period last year. Earnings per share (EPS) for the quarter were $0.07, falling short of the analyst estimate of $0.18. Revenue for the quarter was $19.3 million, surpassing the estimated $17.20 million.
Key Financial Achievements
Despite the decline in net income, LCNB Corp achieved several milestones:
- Record total assets managed of $4.21 billion.
- Non-interest income increased by 11.9% year-over-year to $4.1 million.
- Net interest margin increased by 14 basis points from the first quarter of 2024.
Income Statement Highlights
Net interest income for the quarter was $15.2 million, up from $14.2 million in the same period last year. However, the net interest margin for the quarter was 2.86%, down from 3.28% in the same period last year. Non-interest income for the quarter was $4.1 million, compared to $3.6 million for the same period last year.
Balance Sheet and Cash Flow
Total assets at June 30, 2024, increased by 21.6% to $4.21 billion, from $3.46 billion at June 30, 2023. Net loans increased by 20.9% to $1.73 billion, compared to $1.43 billion at June 30, 2023. Total deposits increased by 21.7% to $3.94 billion, compared to $3.24 billion at June 30, 2023.
Challenges and Future Outlook
LCNB Corp faced several challenges, including a significant increase in non-interest expenses, which rose to $17.8 million for the quarter, compared to $12.1 million for the same period last year. This increase was primarily due to higher personnel and operating expenses, as well as one-time merger-related expenses.
"Our second quarter results demonstrate the initial contribution of the April 12, 2024 Eagle Financial Bancorp, Inc. acquisition and the growing benefits of the November 1, 2023 Cincinnati Bancorp, Inc. acquisition," said Eric Meilstrup, President and CEO of LCNB Corp.
Capital Allocation
During the six months ended June 30, 2024, LCNB did not repurchase any of its outstanding shares. The company paid $0.22 per share in dividends for the second quarter, a 4.8% increase from $0.21 per share in the second quarter of last year.
Asset Quality
LCNB recorded a provision for credit losses of $528,000 for the second quarter, compared to $30,000 for the same period last year. Total nonperforming loans were $3.0 million, or 0.17% of total loans, at June 30, 2024, compared to $707,000, or 0.05% of total loans, at June 30, 2023.
Conclusion
While LCNB Corp (LCNB, Financial) faced challenges in the second quarter of 2024, including a decline in net income and increased non-interest expenses, the company achieved significant milestones in asset growth and non-interest income. The acquisitions of Eagle Financial Bancorp and Cincinnati Bancorp have contributed to the company's scale and financial performance. Investors will be keen to see how LCNB Corp leverages these acquisitions and navigates the challenges in the coming quarters.
Explore the complete 8-K earnings release (here) from LCNB Corp for further details.
