34
LNB Bancorp, Inc.
Exhibit to Form 10 - Q
(For the six months ended June 30, 1996)
S - K Reference Number (13)
Second Quarter Report to Shareholders of
LNB Bancorp, Inc. (dated June 30, 1996)
EDGAR Version
Description:
Two sided pamphlet: Backside cover containing the list of Director's of LNB
Bancorp, Inc. Officers of LNB Bancorp, Inc. and Directors Emeritus of Lorain
National Bank and outside green cover with beige lettering stating LNB Bancorp,
Inc., Quarterly Report, June 30, 1996 along with logo.
Inside contains: Message to Our Shareholders, unaudited EDGAR Version
Consolidated Balance Sheets for period ending June 30, 1996 and June 30, 1995
and unaudited Consolidated Statements of Income for the Six Months Ended
June 30, 1996 and June 30, 1995.
35
Message to Our Shareholders
It's a pleasure, once again, to report on the progress of LNB Bancorp,
Inc., and its subsidiary, The Lorain National Bank, after the first six
months of 1996.
We are pleased to announce that earnings have increased 22.6 percent for
the first half of the year, compared to the same period one year ago.
Consolidated net income for the first six months of 1996 reached
$2,777,000, up from $2,265,000 for the comparative period in 1995.
Our performance continues to strengthen, as indicated by our steadily
increasing annualized return on average assets, which reached 1.33 percent at
mid-year.
Year-to-date cash dividends declared to shareholders has increased 16.7
percent over the comparative period in 1995. Total shareholders' equity
also increased $3.3 million during the 12 months ended June 30, 1996 and
total shareholders' equity, as a percentage of total assets, reached 10.0
percent.
Total assets rose 2.7 percent to $424,488,000 as of June 30, 1996. Net
loans increased to $281,660,000 at June 30, 1996. This represents an
increase of $11.8 million or 4.4 percent over the net loans at June 30,
1995.
During the second quarter, we acknowledged the retirement of Don A. Sanborn
after 25 years as a director of Lorain National Bank and 13 years as a
director of LNB Bancorp, Inc. He joins James H. Riddell, who retired last
fall, as Director Emeritus of Lorain National Bank. Also during the second
quarter, we welcomed Robert M. Campana to our board. Mr. Campana is
Managing Director of P.C. Campana, Inc. of Lorain.
In June, we moved our Lorain Plaza customer base into our new Oberlin Avenue
banking facility and celebrated our opening with a grand prize drawing and
gifts for new accounts. The relocation provides our west-side Lorain
customers with an attractive lobby, multi-lane drive-in and automated teller
banking, all in one convenient location.
We thank you for your loyalty and continued support and look forward to
addressing you after the completion of another year of successful operations.
Sincerely,
/s/ Stanley G. Pijor /s/ J. F. Kidd
------------------------ -----------------
Stanley G. Pijor James F. Kidd
Chairman of the Board President and
Chief Executive Officer
36
Consolidated Balance Sheets
June 30
--------------------------
1996 1995
------------ ------------
ASSETS:
Cash and Due From Banks $ 24,131,000 $ 20,695,000
Federal Funds Sold and other Interest Bearing
Instruments 705,000 -0-
Securities Available for Sale 14,424,000 10,841,000
Investment Securities 86,624,000 94,497,000
Loans 285,655,000 273,739,000
Reserve for Possible Loan Losses (3,995,000) (3,915,000)
- ------------------------------------------------------------------------------
NET LOANS 281,660,000 269,824,000
- ------------------------------------------------------------------------------
Premises and Equipment (net) 10,871,000 10,925,000
Other Assets 6,073,000 6,394,000
- ------------------------------------------------------------------------------
TOTAL ASSETS $424,488,000 $413,176,000
- ------------------------------------------------------------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY:
Non-Interest Bearing Deposits $ 61,554,000 $ 59,688,000
Interest Bearing Deposits 296,013,000 290,470,000
- ------------------------------------------------------------------------------
TOTAL DEPOSITS 357,567,000 350,158,000
Securities Sold under Repurchase
Agreements 21,514,000 21,296,000
Other Liabilities 2,998,000 2,659,000
- ------------------------------------------------------------------------------
TOTAL LIABILITIES 382,079,000 374,113,000
- ------------------------------------------------------------------------------
Common stock 4,126,000 4,014,000
Additional capital 20,077,000 17,697,000
Retained Earnings 18,247,000 17,331,000
Net Unrealized Security Gains(Losses) (41,000) 21,000
- ------------------------------------------------------------------------------
TOTAL SHAREHOLDERS' EQUITY 42,409,000 39,063,000
- ------------------------------------------------------------------------------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $424,488,000 $413,176,000
- ------------------------------------------------------------------------------
(LOGO) LNB
Bancorp, Inc.
and its subsidiary Lorain National Bank
37
Consolidated Statements on Income
Six Months Ended
June 30
------------------------
1996 1995
------------------------
INTEREST INCOME:
Interest and Fees on Loans $12,646,000 $12,116,000
Interest and Dividends on Securities: 3,163,000 2,897,000
Interest on Federal Funds Sold 115,000 122,000
- -----------------------------------------------------------------------------
TOTAL INTEREST INCOME 15,924,000 15,135,000
- -----------------------------------------------------------------------------
INTEREST EXPENSE:
Interest Deposits 5,198,000 5,083,000
Interest on Securities Sold under
Repurchase Agreements 450,000 625,000
- -----------------------------------------------------------------------------
TOTAL INTEREST EXPENSE 5,648,000 5,708,000
- -----------------------------------------------------------------------------
NET INTEREST INCOME 10,276,000 9,427,000
Provision for Loan Losses 300,000 200,000
- -----------------------------------------------------------------------------
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 9,976,000 9,227,000
- -----------------------------------------------------------------------------
OTHER INCOME:
Trust Department Income 536,000 477,000
Fees and Service Charges 1,861,000 1,598,000
Gains From Sales of Loans and Securities -0- -0-
Other Operating Income 51,000 8,000
- -----------------------------------------------------------------------------
TOTAL OTHER INCOME 2,448,000 2,083,000
- -----------------------------------------------------------------------------
OTHER EXPENSES:
Salaries and Employee Benefits 4,010,000 3,764,000
Net Occupancy Expense of Premises 639,000 604,000
Furniture and Equipment Expenses 1,078,000 1,001,000
FDIC Deposit Insurance Premium 1,000 368,000
Ohio Franchise Tax 290,000 248,000
Other Operating Expenses 2,283,000 2,005,000
- -----------------------------------------------------------------------------
TOTAL OTHER EXPENSES 8,301,000 7,990,000
- -----------------------------------------------------------------------------
INCOME BEFORE FEDERAL INCOME TAXES 4,123,000 3,320,000
Federal Income Taxes 1,346,000 1,055,000
- -----------------------------------------------------------------------------
NET INCOME $2,777,000 $2,265,000
- -----------------------------------------------------------------------------
PER SHARE DATA:
NET INCOME $ .67 $ .55
- -----------------------------------------------------------------------------
DIVIDENDS DECLARED $ .28 $ .24
=============================================================================
The per share data has been adjusted to reflect the 2% stock dividend in 1996
and the 5-for-4 stock split in 1995. Net income per share is based on
weighted average common and common equivalent shares outstanding.
38
Backside Cover: 3 Column format
Directors and Officers of LNB Bancorp, Inc.
Directors
James L. Bardoner Jeffrey F. Riddell
Retired, Former President President
Dorn Industries, Inc. Consumers Builders Supply Co.
Vice President and
Daniel P. Batista Chief Executive Officer,
Attorney/Partner Consumeracq, Inc.
Cook & Batista Co., L.P.A.
Thomas P. Ryan
Robert M. Campana Executive Vice President
Managing Director and Secretary/Treasurer
P.C. Campana, Inc. LNB Bancorp, Inc.
Executive Vice President
Wellsley O. Gray and Secretary
Sales Consultant Lorain National Bank
Smith Dairy Company
T.L. Smith, M.D.
James F. Kidd Retired Physician
President and
Chief Executive Officer Eugene M. Sofranko
LNB Bancorp, Inc. and President and
Lorain National Bank Chief Executive Officer
Lorain Glass Company, Inc.
David M. Koethe
Chairman of the Board Paul T. Stack
The Lorain Printing Company Manufacturer's Representative
Coley's Inc. and
Benjamin G. Norton A-1 Welding and Fabricating, Inc.
Employee and Community
Relations Manager Leo Weingarten
RELTEC Corporation Retired
Lorain Products
Stanley G. Pijor
Chairman of the Board
LNB Bancorp, Inc. and
Lorain National Bank
Directors Emeritus of Lorain National Bank
James H. Riddell Don A. Sanborn
Chairman of the Board Retired
Consumers Builders Supply Co.
President, Consumeracq, Inc.
38
Backside Cover: 3 Column format (Continued)
Officers
James F. Kidd
President and
Chief Executive Officer
Thomas P. Ryan
Executive Vice President
and Secretary/Treasurer
Willard H. DoBrunz
Senior Vice President
Gregory D. Friedman
Senior Vice President
Chief Operating Officer and
Chief Financial Officer
Michael D. Ireland
Senior Vice President
Emme N. Mason
Senior Vice President
James H Weber
Senior Vice President
Mitchell J. Fallis
Vice President and
Chief Accounting Officer
Frontside cover description:
Green background, beige lettering.
(Logo) LNB
Bancorp, Inc.
and its subsidiary Lorain National Bank
(bottom middle of outside cover)
Quarterly Report
(middle right side of frontside cover)
LNB BANCORP, INC.
(middle right side of frontside cover)
June 30, 1996
(bottom right side of frontside cover)