January 26, 2011

Lyons Bancorp, Inc., the parent company of The Lyons National Bank, reported record earnings of $4.2 million in 2010, which translates into earnings per share of $4.86, an increase of 10.7% over earnings per share of $4.39 in 2009. Earnings for the fourth quarter of 2010 were $1.1 million, or $1.28 per share, an increase of 4.1% from the third quarter of 2010 and 1.6% over the same quarter last year.

The increase in net income year over year was due primarily to an increase in net interest income. Net interest income totaled $17.1 million, up $2.0 million or 12.9% over the same period last year, due primarily to an increase in earning assets funded by strong core deposit growth. Net interest margin, on a tax-equivalent basis, was 3.83% for 2010, improving modestly from 3.82% for 2009. Noninterest income was essentially flat year over year, while noninterest expenses increased 5.9% year over year, due primarily to the opening of the company's newest branch office, located in Seneca County. Total assets as of December 31, 2010 were $513.6 million, an increase of $55.8 million or 12.2% over the prior year. Total loans outstanding as of December 31, 2010 were $312.6 million, up $24.4 million or 8.5% over the same period last year. Loan growth was funded by strong growth in core deposits, as total deposits increased $41.7 million during 2010 and ended the year at $424.0 million.

At year end, the company's allowance for loan losses totaled $6.4 million, or 2.06% of total loans at December 31, 2010. Nonperforming loans totaled 1.79% of total loans as of December 31, 2010, increasing from 0.86% at December 31, 2009, while net charge-offs for 2010 were 0.30% of average loans, also an increase from 2009 levels. Both of these factors contributed to an increased provision for loan loss expense year over year; however each of these ratios continue to compare favorably to national averages published by the Federal Reserve.

"2010 was another successful year for LNB", stated President and CEO Robert A. Schick. Not only did our earnings increase almost 11%, but we surpassed $500 million in assets, opened a new branch in Seneca County and raised additional capital to support our future growth."

The capital was raised through a private placement offering of Trust Preferred Securities which added approximately $2.9 million in regulatory capital. This offering, coupled with strong earnings, strengthened the company's ratio of Tier 1 capital to average assets, which measured 8.30% at December 31, 2010, compared to 8.00% at December 31, 2009.

Lyons Bancorp, Inc. is the holding company for The Lyons National Bank. The Lyons National Bank is a community bank with offices in Lyons, Clyde, Macedon, Newark, Ontario, and Wolcott in Wayne County; Jordon in Onondaga County; Geneva in Ontario County; Penn Yan in Yates County; and Seneca Falls in Seneca County. Subsidiaries of The Lyons National Bank are Lyons Realty Associates Corp. and Lyons Life Agency, Inc.