Lyons Bancorp, Inc., the financial holding company for The Lyons National Bank, reported a 17% increase in 3rd quarter 2018 earnings as compared to the same period in 2017. On a per share basis, the Company earned $0.77, fully diluted, versus $0.66 per common share last year. As a result, for the first nine months of 2018, Lyons earned $2.10 per common share, fully diluted, versus $1.83 in the same period last year – an increase of almost 15%.

Fueling this growth in earnings was both the effects of the 2017 corporate tax cut and a 5.00% growth in average assets, year-over-year. Average assets on September 30, 2018 were $1.039 billion versus $988 million at September 30, 2017. Loans constituted the majority of this growth, as they grew by almost $74 million on average, while the Bank consciously reduced its investment portfolio using the proceeds of maturing investment to fund loan growth.

Helping to support the growth in loans was a strong growth in deposits. Average
deposits on September 30, 2018 were $936 million versus $895 million at September 30,
2017. The Bank opened two branches in Auburn, NY, one in May of 2017 and another in
February of 2018. The FDIC reports that Auburn is a $1 billion bank deposit market. At
September 30, 2018, the Bank cultivated $45 million in customer deposits from that
market.

For the nine months ending September 30, 2018, all of the Bank’s performance
ratios that the industry tracks improved over the following year. The Bank’s return on
average assets grew to 0.89% from 0.82%; its immediate targeted benchmark is 1.00%.
For the quarter ending September 30, 2018, the ratio was 0.96%. The Bank’s return on
average equity grew to 12.52% from 11.16%; its net interest margin grew to 3.49% from
3.35% and its efficiency ratio improved by declining from 69.81% to 69.22%. The
efficiency ratio measures how much a company incurs in expenses in order to earn $1.00
in revenues; therefore, the lower the ratio the better.

Asset quality at the Bank remained strong. Net loan charge-offs were $610
thousand or eight tenths of one percent in the nine months ended September 30, 2018 as
compared to $509 thousand last year. Year-to-date, the Bank has increased its allowance
for loan losses to $9.6 million from $8.6 million. Loans not performing to original terms
and conditions did increase to $2.5 million from $1.3 million but remain well below
industry tolerances.

“We are obviously again pleased with our financial results” stated Robert A.
Schick, Chief Executive Officer and Board Chairman. “While the tax law change had a
hand in our improved earnings, our continued ability to grow our market share was
equally important to our success. This in turn, is a strong reflection on the dedication and
hard work of our staff!”