LCNB Corp. (LCNB): BCG Matrix [Dec-2025 Updated]

You're looking for the real story on LCNB Corp.'s portfolio health in late 2025, so I've mapped out the four quadrants for you. We see clear Stars like Wealth Management hitting $1.40 billion in Assets Under Management and growing fiduciary income by a massive 23.4%, while the core bank reliably churns out $18.1 million in Net Interest Income on a solid 3.57% Net Interest Margin-these are your Cash Cows. However, the portfolio isn't perfect; de-emphasized mortgage sales are dragging down non-interest income by 11.0% (Dogs), and the $1.71 billion loan book needs serious capital injection into new Commercial and Industrial lending to become the next big thing (Question Marks). Dive in to see defintely where LCNB Corp. needs to invest or cut bait right now.

Background of LCNB Corp. (LCNB)

You're looking at LCNB Corp. (LCNB), a financial holding company that centers its operations around its main subsidiary, LCNB National Bank. Honestly, this is a community bank focused on serving customers and communities across Southwest and South-Central Ohio. They offer the full suite of services you'd expect, including commercial and retail banking, personal and business lending, deposit services, and wealth management, which includes trust and investment services.

The company has been actively integrating recent acquisitions, and management has been focused on optimizing the balance sheet to improve profitability. For instance, in the third quarter of 2025, LCNB Corp. deliberately decreased higher cost certificates of deposit and saw lower-rate loans and securities mature. These actions helped expand the net interest margin by 73 basis points year-over-year to 3.57% for Q3 2025.

Looking at the hard numbers from the latest report for the quarter ended September 30, 2025, LCNB Corp. posted a net income of $6.936 million, a significant jump from $4.532 million in the same period last year. This translated to diluted earnings per share of $0.49, marking a 58.1% improvement over Q3 2024's $0.31. The return on average assets for the quarter was 1.21%.

On the balance sheet side, total assets were reported at $2.244 billion as of September 30, 2025, a slight decrease from the end of 2024. Net loans stood at $1.67 billion at that same date. Still, total shareholders' equity grew to $269.870 million, with tangible shareholders' equity reaching $172.4 million, or $12.15 per share. The wealth management division, LCNB Wealth, is showing momentum, hitting a record of $1.54 billion in trust and investment services assets by quarter-end.

The company maintains a consistent approach to shareholder returns, having declared a fourth-quarter 2025 cash dividend of $0.22 per common share, payable on December 15, 2025. At the time of recent reporting, the market capitalization was approximately $225.28 million, and the price-to-earnings ratio was 9.18.

LCNB Corp. (LCNB) - BCG Matrix: Stars

You're looking at the growth engine of LCNB Corp. (LCNB) right now, the segment that demands investment to maintain its leadership position in a growing market. For LCNB Corp. (LCNB), that engine is clearly the Wealth Management platform.

This business unit is demonstrating the characteristics of a Star: high market share leadership in a segment that is still expanding. The numbers from the third quarter of 2025 really drive this home. For instance, trust/investment and investment services assets hit a record $1.54 billion at the end of Q3 2025. That's a significant jump from the $1.38 billion recorded at the end of 2024.

Here's a quick look at how the unit's performance translated to the bottom line in Q3 2025:

The growth in fiduciary income is particularly telling; it jumped 23.4% year-over-year in Q3 2025. That signals high growth in what is typically a high-margin segment for a bank like LCNB Corp. (LCNB). This momentum is what keeps the unit in the Star quadrant-it's leading, but it consumes cash to fuel that growth and fend off competitors.

The key drivers for this segment, as we see them, are:

• LCNB Wealth Management, hitting record Assets Under Management (AUM) of over $1.54 billion as of September 30, 2025.
• Fiduciary income jumped 23.4% in Q3 2025, showing high growth in a high-margin segment.
• Strong organic growth in trust and brokerage accounts, outpacing the overall regional bank market.
• This platform is a key differentiator against smaller community bank peers.

Honestly, the ability to generate this level of fee income while the overall company is strategically reducing balance sheet assets-total assets were down to $2.24 billion at September 30, 2025, from $2.31 billion at year-end 2024-shows the unit's relative strength. The company itself noted that many community banks don't offer independent wealth management capabilities, positioning LCNB Corp. (LCNB) favorably. If LCNB Corp. (LCNB) keeps investing here, this unit is definitely on the path to becoming a Cash Cow when the market growth naturally slows down.

Finance: model the cash flow impact of a 10% increase in Wealth Management operating expenses for Q4 2025 by next Tuesday.

LCNB Corp. (LCNB) - BCG Matrix: Cash Cows

You're looking at the core engine of LCNB Corp. (LCNB)'s profitability, the units that generate more cash than they need to maintain their position. These are the classic Cash Cows in the Boston Consulting Group framework: high market share in a mature, low-growth segment. They fund the rest of the company's ambitions.

The primary driver here is the Net Interest Income (NII), which hit $18.1 million in Q3 2025. That's solid, dependable cash flow from established lending and deposit relationships. This performance is underpinned by an expanded Net Interest Margin (NIM) of 3.57% in Q3 2025, which clearly shows LCNB Corp. (LCNB) is effectively managing its asset sensitivity and funding costs in the current rate environment. Honestly, that margin is the key indicator of a strong competitive advantage in this mature space.

Here's a quick look at the key financial metrics defining this cash generation:

Because this business segment operates in a mature market within its Ohio footprint, market share is high and growth is low. You don't need massive promotional spending here; you need efficiency. LCNB Corp. (LCNB) is demonstrating this through disciplined expense control, keeping non-interest expenses steady at around $15.1 million in Q3 2025. Investments here should focus on infrastructure that drives down the cost-to-serve, not on aggressive market expansion.

The characteristics that firmly place these units in the Cash Cow quadrant include:

• Stable, low-cost deposit base providing funding advantage.
• High market share across the established Ohio footprint.
• Net Interest Margin of 3.57% indicating strong pricing power.
• NII generation of $18.1 million, exceeding required reinvestment.

These units are the source of capital for funding riskier Question Marks or defending Stars. The goal isn't growth; it's maximizing the net cash flow from this established position. If onboarding takes 14+ days, churn risk rises, so maintaining operational smoothness is key to milking these gains passively.

Finance: draft 13-week cash view by Friday, focusing on NII projections.

LCNB Corp. (LCNB) - BCG Matrix: Dogs

Dogs are business units or products characterized by low market share in low growth markets. These segments often tie up capital without generating significant returns, making them candidates for divestiture or minimization.

Residential mortgage loan sales into the secondary market represent an activity LCNB Corp. has de-emphasized as part of its strategic refinement. This is supported by the trend in loans held for sale; at March 31, 2025, loans held for sale totaled $6.1 million, a significant reduction from $75.6 million at March 31, 2024.

The impact of de-emphasizing loan sales is visible in the non-interest income figures. For the three months ended September 30, 2025, non-interest income fell 11.0% year-over-year, moving from $6.4 million in Q3 2024 to $5.7 million in Q3 2025. The primary driver for this decrease was a $0.9 million reduction in net gains from loan sales.

Here's a quick look at the recent loan sale activity and its income contribution for Q3 2025:

The broader balance sheet optimization efforts, which began in prior periods, included actions like the over $97 million in opportunistic asset sales completed throughout 2024. These efforts align with minimizing lower-performing assets.

The portfolio composition reflects a move away from lower-yielding assets. This includes the payoff of certain legacy loan portfolios that carried lower interest rates. Furthermore, the bank has been actively paying down its low-yield investment securities portfolio, an action taken specifically to improve the Net Interest Margin (NIM).

The strategic focus is clearly on shedding lower-return components:

• - Residential mortgage loan sales into the secondary market, a de-emphasized activity.
• - Non-interest income fell 11.0% in Q3 2025, primarily due to reduced net gains from loan sales.
• - Low-yield investment securities portfolio, which the bank has been actively paying down to improve NIM.
• - Certain legacy loan portfolios with lower interest rates that were paid off as part of balance sheet optimization.

LCNB Corp. (LCNB) - BCG Matrix: Question Marks

You're looking at the business units that are burning cash now but hold the key to future market leadership-the Question Marks for LCNB Corp. These are areas in high-growth markets where LCNB Corp. hasn't yet secured a dominant position. Honestly, it's a classic high-risk, high-reward setup.

The overall Net Loans portfolio, which sits at $1.71 billion as of the second quarter of 2025, was relatively flat, actually showing a slight sequential decrease of 0.5%, or $8.9 million, from the end of 2024. That flatness, when you consider the recent acquisitions, signals that the core lending engine isn't yet firing on all cylinders in terms of net expansion.

The focus here is squarely on Commercial and Industrial (C&I) lending within the new, expanded Ohio markets LCNB Corp. gained from recent acquisitions. This segment is where the growth potential lies, but it's clearly demanding more resources. To turn this into a Star, LCNB Corp. needs defintely more investment and focus to accelerate growth and capture market share quickly, or these efforts risk becoming Dogs.

Management has signaled their view on this bet. They expect loan growth to accelerate in the first half of 2026. That's the high-reward part of the equation, but right now, it's a high-risk proposition because cash is being spent to build that pipeline while the current portfolio size is stagnant or shrinking slightly.

We can see the cash dynamics in the Q2 2025 activity. The company originated $88.8 million in loans, which is the investment going in, but they simultaneously sold $30.0 million into the secondary market. That sale generated gains but kept the net loan growth muted, which is typical for a Question Mark trying to manage risk while building out new market penetration.

Here's a quick look at the loan portfolio health that frames the risk associated with these growth areas:

The growth in wealth management services in these new territories shows promise, suggesting a market need for LCNB Corp.'s full suite of services. You can see the traction in the investment services division:

• Increased assets under management by over 300% at newly acquired branches over the past 12 months.
• Net interest margin expanded to 3.47% in Q2 2025, up 61 basis points year-over-year, showing pricing power is present.
• Net income for Q2 2025 was $5.9 million, a significant jump from $0.9 million in Q2 2024.
• Return on Assets (ROA) was above 1% for the quarter.

Finance: draft the projected cash flow impact for a $50 million targeted investment into C&I loan origination for H2 2025 by Friday.