New deal gives LCNB National Bank more growth potential


LCNB Corp.

What: Parent financial holding company of LCNB National Bank, a community bank

Where: Headquarters 2 N. Broadway Street, Lebanon

Phone: (513) 932-1414

President: Steve Foster

Chairman and CEO: Steve Wilson

Website: www.lcnb.com

Assets: $985 million

Branch offices: 31

Employees: 307

One of the region’s largest community banks recently completed its biggest acquisition in the company’s 130-plus year history, and executives see growth potential in the new markets.

Lebanon’s LCNB Corp., the parent holding company of LCNB National Bank, closed on Jan. 11 its approximately $19.6 million deal to acquire First Capital Bankshares Inc., the parent company of Chillicothe bank Citizens National.

LCNB brings additional services Citizens National Bank didn’t have — a trust partner, investment services, and new products including mobile banking, said Steve Foster, president of LCNB. Citizens National is the No. 2 bank in its markets by deposits with a $2 million lending limit based on its asset size. Now as part of LCNB, that increases to a $10 million lending limit.

New banking products and services and a higher lending limit means LCNB will able to serve customers Citizens National could not before the sale, said Foster and Steve Wilson, LCNB chairman and chief executive officer.

“We see a lot of potential for growth there as a community bank with those types of services and those capabilities. We think it serves our LCNB footprint well to expand that direction,” Foster said.

“That doesn’t mean there aren’t some opportunities or won’t be opportunities closer to Lebanon in our market we’ve established already here, and there may be more opportunities over there in the future. So we can fill in between here and Washington Court House and Chillicothe or we can go further south,” Foster said.

The deal with Citizens puts LCNB out of the Cincinnati-Dayton region for the first time, adding Fayette and Ross counties to its existing six-county market area. However, Fayette and Ross are contiguous on the east side to counties LCNB already operates in.

“It’s really a natural extension of our market area to two really growing healthy markets,” Wilson said

The acquisition gave LCNB the opportunity to buy a healthy bank — LCNB has turned down FDIC deals and troubled bank deals, Wilson said. It’s also a good fit in cultures. Both banks are historic community banks, with focuses on customer service, he said.

“We have always wanted to and will continue to want to have controlled growth,” Wilson said. “We don’t want to grow too fast to lose who we are, which is our competitive advantage.”

The acquisition plans were first announced in October.

Citizens has six branch offices in Chillicothe, Washington Court House, Clarksburg and Frankfort. That gives LCNB, including its existing local branches, 31 total office locations.

After the acquisition closed, LCNB’s assets reached $985 million in assets and $850 million in deposits.

The Lebanon bank’s last acquisition was in 2007 when it bought Sycamore National Bank in Cincinnati, which took LCNB to the west side of the Cincinnati market, extending its presence in Hamilton County.

In 1997, LCNB bought three bank offices in Okeana, Oxford and Waynesville from KeyCorp.

The next step with Citizens is to integrate the new bank into LCNB, especially its data systems, Foster said. Citizens National Bank offices assume the LCNB name.

Citizens President and CEO Tom Beard will stay on as a community president until his retirement in 2014. The board of Citizens will stay on as an advisory board that meets quarterly this year. And Citizens board chairman, John Kochensparger, has joined the LCNB board, Foster said.

LCNB National Bank is Warren County’s second-largest bank by deposits of $503 million, according to the Federal Deposit Insurance Corp. It’s the 10th-largest in the Cincinnati metro on deposits of $669 million, including Warren County.

LCNB expects to release full-year 2012 financial results this week.

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