WILMINGTON, Ohio, Jan. 18, 2011 (GLOBE NEWSWIRE) -- NB&T Financial Group, Inc. (Nasdaq:NBTF), parent company of The National Bank and Trust Company ("NB&T"), Wilmington, Ohio, announced higher net income for 2010 of $8.8 million, or $2.58 per share, compared to net income of $4.0 million, or $1.28 per share, for 2009. This increase is primarily attributable to the acquisitions of Community National Bank ("CNB") in December 2009 and American National Bank ("ANB") in March 2010. The increase in net income over last year is primarily due to the bargain purchase pre-tax gain of approximately $7.6 million in the Federal Deposit Insurance Corporation ("FDIC") assisted acquisition of certain of the assets and liabilities of ANB, as well as a $5.8 million increase in net interest income largely offset by a $4.0 million increase in non-interest expenses, and a $3.5 million increase in income taxes. In addition, NBTF realized a pre-tax gain of $1.4 million on the sale of its insurance agency subsidiary in January 2010. Net income for the fourth quarter of 2010 was $718,000, or $.20 per share, compared to $1.6 million, or $.49 per share, for the fourth quarter of 2009. NB&T took advantage of excess liquidity to prepay a $12.5 million Federal Home Loan Bank ("FHLB") advance with a relatively high interest rate, although such prepayment resulted in a prepayment penalty of approximately $416,000 in December 2010. NB&T also recognized compensation expense of $213,000 related to the early allocation of the remaining shares in NBTF's employee stock ownership plan in December 2010. In addition, a bargain purchase gain of $1.8 million from the CNB acquisition was recognized in the fourth quarter of 2009. Net interest income was $24.3 million for 2010, compared to $18.4 million for 2009. Net interest margin increased to 3.83% for 2010, compared to 3.70% for last year. The net interest margin increased primarily due to two factors. First, average loans outstanding for 2010, which had an average rate of 6.25%, increased $87.4 million, largely a result of the CNB and ANB acquisitions. Second, the average cost of interest-bearing liabilities declined from 1.79% in 2009 to 1.40% in 2010 on increased average deposits of $134.1 million. Due to increased liquidity, NB&T was able to lower rates on non-transaction accounts over the last year. Net interest income was $6.0 million for the fourth quarter of 2010, compared to $4.6 million for the same quarter in 2009. Average earning assets for the fourth quarter of 2010 were $704.9 million, compared to $564.9 million for the fourth quarter of 2009. Net interest margin increased from 3.53% for the fourth quarter of 2009 to 3.69% for the fourth quarter of 2010.