NB&T Financial (NBTF) 8-K NB&T Financial Reports Earnings for Second Quarter 2012

EXHIBIT 99.1

NB&T Financial Reports Earnings for Second Quarter 2012

July 17, 2012

NB&T Financial Group, Inc. (Nasdaq: NBTF), parent company of The National Bank and Trust Company (“NB&T”), Wilmington, Ohio, announced net income for the second quarter of 2012 of $1.2 million, or $.33 per share. Net income for the second quarter of 2011 was $1.0 million, or $.31 per share. Net income increased primarily due to recognition of $161,000 in securities sale gains, compared to $10,000 in securities sale losses in the second quarter of last year. Net income for the first six months of 2012 was $1.5 million, or $.44 per share, compared to $2.1 million, or $.60 per share, for the same period in 2011.

Comparing the first half of 2012 to 2011, President & CEO, John Limbert, commented, “Beside the increase in the loan loss provision, our net interest income declined $1.1 million the first six months of 2012, compared to the same period last year. The continued low interest rate environment and stagnant loan volume is impacting our margin. Fortunately, we have been able to reduce expenses approximately $900,000 over the comparable period of last year to partially offset the margin decrease.”

Net interest income was $5.4 million for the second quarter of 2012, compared to $6.1 million for the second quarter of 2011. Net interest margin decreased to 3.38% for the second quarter of 2012, compared to 3.95% for the same quarter last year. The net interest margin decreased primarily due to a change in asset mix from higher-yielding loans to lower-yielding securities. Average loans, which had an average rate of 5.47%, declined $14.7 million, while average overnight investments and securities, with an average rate of 1.50%, increased $38.3 million in the second quarter of 2012. Net interest income for the first half of 2012 was $10.9 million, compared to $12.0 million for the first half of 2011.

The provision for loan losses for the second quarter of 2012 was $332,000, compared to $385,000 in the same quarter last year. Net charge-offs were $397,000 in the second quarter of 2012, compared to $415,000 in the second quarter of 2011. Year to date net charge-offs for 2012 were $1.8 million, compared to $415,000 for the first six months of 2011. Charge-offs in 2012 increased primarily due to the write-off of one commercial loan for approximately $850,000, which was fully reserved for at the previous year end. The provision for loan losses for the six months ended June 30, 2012, was also increased to add specific loan reserves of approximately $622,000 for two commercial real estate loans and to add general reserves related to increased charge-off experience. Non-performing loans were $12.1 million at June 30, 2012, compared to $12.5 million at June 30, 2011. The June 30, 2012 non-performing loans include a $3.2 million loan relationship put on non-accrual status during the quarter. The borrower’s financial condition has weakened and its working capital line has matured. The borrower and NB&T are currently developing a workout plan. Approximately $727,000 of the non-performing loans outstanding at June 30, 2012 are covered under the Company’s FDIC loss share agreement, with the FDIC sharing in 80% of any future losses associated with those loans.

Total non-interest income was $2.3 million for the second quarter of 2012, compared to $1.9 million for the second quarter of 2011. Non-interest income for 2012 was higher due to recognition of $161,000 in securities sale gains, compared to $10,000 in securities sale losses in the second quarter of last year. In addition, overdraft fees have increased in 2012. Non-interest income for the first six months of 2012 was $4.4 million, compared to $4.5 million for the same period last year.

Total non-interest expense was $5.8 million for the second quarter of 2012, compared to $6.1 million for the second quarter of 2011. The decline in expense is to due to overall expense reduction primarily in the areas of personnel, benefit costs, branch hours, marketing and other processing costs. For the first six months of 2012, total non-interest expense was $11.8 million, compared to $12.7 million for the same period in 2011.

On May 15, 2012, the Board of Directors declared a dividend of $0.30 per share, payable July 23, 2012 to shareholders of record on June 29, 2012.

SELECTED CONSOLIDATED FINANCIAL HIGHLIGHTS

(in thousands, except per share data)

(Unaudited)

	Three Months Ending															Six Months Ending
	6/30/2012			3/31/2012			12/31/2011			9/30/2011			6/30/2011			6/30/2012			6/30/2011
Statements of Income
Interest income	$	6,278		$	6,527		$	6,685		$	6,829		$	7,348		$	12,805		$	14,658
Interest expense		896			964			999			1,079			1,270			1,860			2,656
Net interest income		5,382			5,563			5,686			5,750			6,078			10,945			12,002
Provision for loan losses		332			1,300			1,525			475			385			1,632			935
Other non-interest income		2,176			2,116			2,080			2,148			1,907			4,292			3,676
Other-than-temporary impairment charge		(35	)		—			—			—			—			(35	)		—
Net gains/(losses) on sales of securities		161			—			620			421			(10	)		161			779
Total non-interest income		2,302			2,116			2,700			2,569			1,897			4,418			4,455
Total non-interest expenses		5,801			6,014			6,116			6,282			6,146			11,815			12,725
Income before income taxes		1,551			365			745			1,562			1,444			1,916			2,797
Income taxes		396			4			128			432			395			400			743
Net income	$	1,155		$	361		$	617		$	1,130		$	1,049		$	1,516		$	2,054
Per Share Data
Basic earnings per share	$	0.33		$	0.11		$	0.18		$	0.33		$	0.31		$	0.44		$	0.60
Diluted earnings per share		0.33			0.11			0.18			0.33			0.31			0.44			0.60
Dividends per share		0.30			0.30			0.30			0.30			0.30			0.60			0.60
Book value at quarter end		20.72			20.63			20.68			20.98			20.71			20.72			20.71
Average basic shares outstanding		3,425			3,424			3,423			3,424			3,424			3,424			3,424
Average diluted shares outstanding		3,431			3,434			3,431			3,430			3,436			3,433			3,443
Balance Sheet Items (Quarter End)
Total assets	$	687,226		$	697,620		$	675,588		$	674,030		$	675,028		$	687,226		$	675,028
Securities		156,161			154,437			139,744			145,457			137,071			156,161			137,071
Loans, including loans held for sale		396,500			394,367			404,470			405,009			408,516			396,500			408,516
Allowance for loan losses		4,508			4,573			4,668			3,484			3,475			4,508			3,475
Deposits		592,979			602,963			581,383			576,391			580,730			592,979			580,730
Borrowings		15,310			15,310			15,310			16,485			16,347			15,310			16,347
Total shareholders' equity		70,955			70,663			70,790			71,845			70,903			70,955			70,903
Assets Under Management
Total assets	$	687,226		$	697,620		$	675,588		$	674,030		$	675,028		$	687,226		$	675,028
Cash management sweep accounts		40,739			41,095			33,834			42,310			38,842			40,739			38,842
Market value of trust assets		193,906			205,219			197,274			190,957			200,337			193,906			200,337
Total assets under management	$	921,871		$	943,934		$	906,696		$	907,297		$	914,207		$	921,871		$	914,207
Selected Financial Ratios
Return on average assets (annualized)		0.67	%		0.21	%		0.36	%		0.66	%		0.62	%		0.44	%		0.61	%
Return on average equity (annualized)		6.30			2.04			3.39			6.39			5.97			4.30			5.84
Dividend payout ratio		90.91			272.73			166.67			90.91			96.77			136.36			100.00
Net interest margin		3.38			3.46			3.61			3.67			3.95			3.42			3.90
Non-interest expense to total revenue		75.49			78.32			72.93			75.51			77.07			76.91			77.32
Average loans to average total assets		56.87			56.54			58.55			59.64			60.51			56.57			60.20
Asset Quality
Nonaccrual loans	$	11,962		$	9,647		$	12,007		$	9,646		$	11,452		$	11,962		$	11,452
Accruing and 90 or more days past due		165			327			133			3			1,049			165			1,049
Total nonperforming loans	$	12,127		$	9,974		$	12,140		$	9,649		$	12,501		$	12,127		$	12,501
Other real estate owned		3,032			3,500			3,520			4,236			4,175			3,032			4,175
Net charge-offs		397			1,395			341			466			415			1,792			415
Non-performing loans to total loans		3.06	%		2.53	%		3.00	%		2.38	%		3.06	%		3.06	%		3.06	%
Loan loss allowance to total loans		1.14			1.16			1.15			0.86			0.85			1.14			0.85
Loan loss allowance to non-performing loans		37.17			45.85			38.45			36.11			27.80			37.17			27.80
Accruing loans 30+ days past due to total loans		0.36			0.49			0.63			0.92			0.75			0.36			0.75
Net charge-offs to average loans		0.41			1.41			0.34			0.46			0.41			0.91			0.58
Capital
Average equity to average total assets		10.66	%		10.13	%		10.55	%		10.33	%		10.44	%		10.66	%		10.44	%
Tier 1 leverage ratio**		10.75			10.66			11.03			11.09			11.17			10.75			11.17
Total risk-based capital ratio**		19.25			19.20			19.15			18.86			18.81			19.25			18.81

** Estimated for current quarter end