Good morning, and welcome to the SB Financial Group's Second Quarter 2016 Conference Call and Webcast. I would like to inform you that this conference call is being recorded, and that all participants are in a listen-only mode. We will begin with remarks by management, and then open the conference up to the investment community for questions and answers. I will now turn the conference over to Melissa Martin with SB Financial. Please go ahead, Melissa.

Good morning, everyone. I would like to remind you this conference call is being broadcast live over the Internet and will also be archived and available on our Web site at www.yoursbfinancial.com under Investor Relations. Joining me today are Mark Klein, Chairman, President and CEO; Tony Cosentino, Chief Financial Officer; and Jon Gathman, Senior Lending Officer. Before I turn the call over to Mr. Klein, let me add that this call may contain certain forward-looking statements regarding SB Financial Group's financial performance, anticipated plans, operational results and objectives. Forward-looking statements are based on management's expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those expressed or implied on our call today. We have identified a number of different factors within the forward-looking statements at the end of our earnings release and you are encouraged to review those factors. SB Financial Group undertakes no obligation to update any forward-looking statement, except as required by law, after the date of this call. In addition to the financial results presented in accordance with GAAP, this call will also contain certain non-GAAP financial measures. I will now turn the call over to Mr. Klein.

Thank you, Melissa, and good morning everyone, nice to have you all with us. Welcome to our second quarter webcast for 2016. The momentum that we established in 2015 and on into the first quarter of 2016, I'm happy to report, continued this quarter. Once again we delivered double-digit growth in revenue, net income, including earnings per share and net interest income, loan balances, and deposit growth, while maintaining top tier asset quality. Collectively, our efforts through the first six months of the year have enabled us to improve our overall performance once again and deliver a return on asset of over 1.1%. Highlights, this quarter include, GAAP net income for the quarter was 2.27 million, a 13.8% improvement over the prior year, and a 37% improvement over the year ago period. Likewise, our performance reflected a return on average assets of 1.15% for the quarter and 1.01% year-to-date. Net income available to common shares for the quarter was $2 million or $0.35 a share, representing approximately a 13% improvement over the prior year quarter and 35% over the linked quarter. Loan balances grew another $27 million or 4.8% to complement last quarter's growth of over $19 [ph] million. Collectively, year-to-date, we had over $47 million in growth or 17% annualized. Loan growth over the last year second quarter reflects an expansion of over $82 million or 15.8%. Top line revenue grew by 1.2 million or 12% to complement last quarter's growth of 4.6%. Aggregately, year-over-year revenues expanded by nearly $1 million or 4.7%. Likewise, expenses increased 7.4% from a linked quarter, and represented an acceleration over the prior year-to-date level of 4.8%, due to some of our strategic expansion. Assets under management and our wealth management division grew by 2.7% and 1.6% over the prior year quarter. Due to…

Thanks, Mark, and good morning everyone. For the quarter, we had net income of $2.3 million or $0.35 per diluted earnings per share. Our EPS was up $0.04 and $0.09 from the prior year and linked quarter was 13% and 35% respectively. Through six months, our diluted EPS of $0.61 was up 13% from the prior year. Now let's look at some highlights for the quarter. First, total operating revenue on a fully tax equivalent basis for the quarter was up 5% from the prior year, and up 12.5% from the linked quarter. We had loan growth, up $82 million from the prior year or 15.8%; loans sales delivered gains of $2.4 million from mortgage, small business and agriculture up 16% for the prior year. And lastly as Mark said we had a negative valuation adjustment to our mortgage servicing rights of just under $500,000. Now as we break down the second quarter income statement further, let's begin with net interest margin. Net interest income on a FTE basis was up from the prior year by 11.2% and up 5.1% from the linked quarter. End of period loan balances from the prior year were up $82.4 million, an increase of 13.8% and were up $27.6 million or 19% annualized from the linked quarter. This quarter's loan growth surpassed the very strong first quarter 2016 when we added $19.5 million of balance sheet loan growth. We continue to grow our loan book without sacrificing quality or price. Delinquencies when we net out identified non-performing loans or zero. And our average loan yield decreased by just one basis point from the prior year. In addition, our overall earning asset yield was up 2 basis points from the prior year as our mix trended slightly away from the bond portfolio. On the funding…

Thank you, Tony. It literally was a good quarter on all fronts for SB Financial. We are delivering on our commitments. We expanded our loan and deposit base, provided top line revenue growth, delivered record quarterly mortgage originations and expanded that income as Tony indicated by more than 13%. These improvements are a direct reflection of our robust markets we've entered, diversified product line and regional sales leadership all bound by our commitment to execute on the strategies we've identified. We remain committed to our vision up top-decile performance. Now I'd like to turn back over to Melissa for some questions from our investor community. Melissa?

Thank you, Mark. Operator, we're ready for questions now.

We will now begin the question-and-answer session. [Operator Instructions]

While we are waiting for questions to come in, I'd like to remind you that today's call will be accessible on our Web site at www.yoursbfinancial.com under Investor Relation.

Our first question comes from Chas Craig with Meliora Capital. Please go ahead.

Hi, guys, thanks for taking my question. Firstly, I want to congratulate you on really couple good years now of organic growth. My question though is, as we are continuing to build out the infrastructure, have been and continue to, pretty clear -- I recognize that it's hard to get your expenses fully under control, under that more of a growth orientation, but it seems to me that a fairly low-hanging fruit to increase EPS by a pretty significant amount would be shaving 5% to 10% off your efficiency ratio, and I'm curious if you have line of sight on your ability to do that while you are continuing to grow. Thank you.

Sure. Thanks Chas for the question. We are always looking hard at all of our expense line items. We continue to deploy strategies, and what we caught up a bit with ourselves [ph] here in 2015 by delivering top line revenue with our bets and expanding on expenses and personnel in new markets. We've now ramped that up again. And as Tony indicated, we are up 15 to 17 individuals from the prior year or so. We are kind of in the midst of a growth phase. We've certainly gathered some inertia and momentum in our new markets, and we fully expected those bets to play out like we have in the past and continuing to improve our efficiency ratio with organic balance sheet growth, but it's going to take a few quarters to digest some of the bets that we've made.

Okay, great.

[Operator Instructions] We have no further questions at this time. This concludes our question-and-answer session. I would like to turn the conference back over to Mark Klein for any closing remarks.

Once again, thank you all for joining us. We are proud of the quarter that we produced. We have high expectations for the last half of the year, and we certainly look forward to getting back together with you all in October for reporting our third quarter. Thank you all for joining us, and we'll talk soon. Good-bye.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.