Our track record of proven performance
emanates from a relentless focus on
building customer and community
relationships that drive shared success.
By
and providing
unmatched personalized service,
we continue to generate solid results for
shareholders, while providing opportunities
for our customers to reach their goals
and achieve their dreams.
2014 annuaL rEP ort
in v e s t m e n t rat i o n a l e
Operational focus on managing
interest rate risk
Commitment to an efficient
operating profile
Solid community banking
core business
Growth efforts focused on
Western New York and increasing
market share
Investment in enhanced digital
capabilities to meet customer’s
technology needs
Solid and stable asset quality
metrics compared to industry
peer average
Capital ratios in excess of
regulatory definition for
well capitalized
Experienced management with
deep knowledge of service area
Contents
I Letter to shareholders
4 operations review
8 senior Management
9 Board of Directors
I0 selected Financial information
I2 Bank Locations
I3 shareholder information
Corporate Profile
Lake shore Bancorp, inc. (“the Company”) is the mid-tier holding company of Lake shore
savings Bank, a mission-driven community institution dedicated to serving the financial needs
of consumers and businesses within the bank’s Western new York market area. the Company’s
common stock is traded on the nasDaQ Global Market as “LsBk” and its 5.9 million
shares, including 3.6 million mutual holding company (MhC) shares, had a “market cap” of
approximately $81.2 million on December 31, 2014. the Company had total consolidated assets
of $487.5 million and total deposits of $386.9 million at the end of 2014.
Lake shore savings Bank is dedicated to serving the financial needs of consumers and businesses
in Western new York, which it has been doing for more than 123 years. Lake shore is focused on
providing high-quality, personal customer service through its 11 full-service branches and
18 atMs that are located throughout Chautauqua and Erie counties. headquartered in Dunkirk,
new York, Lake shore has retail locations in Dunkirk, Fredonia, Jamestown, Lakewood, Westfield,
Depew, East amherst, hamburg, kenmore, orchard Park and snyder, where it offers a broad
range of retail and commercial lending and deposit services.
the Company is committed to maintaining an efficient expense profile, driving commercial
loan portfolio growth, identifying and managing institutional risk, and achieving prudent
growth which builds long-term sustainable value for investors. additional information about the
Company and the Bank is available at www.lakeshoresavings.com.
Proven Performance.
Solid Results.
at Lake shore savings Bank we live by a simple philosophy – one that is difficult to duplicate.
We believe that doing right by our customers to help them succeed allows our Bank to thrive
while consistently generating solid and sustainable results for our shareholders.
in short, it’s a win-win strategy that has delivered throughout our 123-year history. the value
and resilience of that strategy has been affirmed in recent years through our track record
of proven performance amid historically challenging economic conditions, unprecedented
regulatory challenges, and fast-changing consumer preferences and expectations.
Putting People First is more than a slogan; it’s a mindset that permeates our organization and
keeps each of us focused on exceeding customer expectations and building lasting, meaningful
relationships with individuals, businesses and organizations throughout the communities
we serve.
For Lake shore, 2014 was in many ways a year of transition during which we struck a prudent
balance between continuing to generate solid returns for our shareholders, while executing
on a long-term strategy which better positions the Bank to perform in a changing interest
rate environment. anchored by our strong capital position, operating efficiency and ongoing
profitability, we were able to continue to invest in talent and technology, and take substantive
steps to reposition our balance sheet. While these actions have reduced our near-term
profitability, we are better positioned to benefit from the anticipated rise in interest rates, while
maintaining the financial strength and flexibility to leverage opportunities to enhance or grow
our franchise in an improving economy.
2014: industry challenges, customer opportunities
While we began to see positive economic signs in 2014, in many ways the aftershocks of
the recession and the sluggish recovery continue to ripple through our industry. the Federal
reserve’s cautious approach has extended the low interest rate environment considerably
longer than many economists had predicted. For a local community bank that is deeply
committed to our customers’ success, this presents a formidable challenge for us.
While we welcome the highly favorable borrowing opportunities this environment provides
our customers, the persistently low interest rates continue to apply significant pressure to
margins and profitability.
During 2014 we continued to diversify the Bank’s funding mix by focusing on core deposit
growth and reducing dependence on more costly time deposits and borrowings. We also took
important steps to shorten the duration of our interest-earning assets. in the simplest terms,
while we will continue to be a competitive residential mortgage lender within our service area,
we are placing a larger emphasis on underwriting quality commercial real estate and other
business loans with shorter durations.
to that end, we added significant talent and depth to our commercial lending team, and
focused on honing our commercial lending expertise. as part of this effort, we developed
enhanced sales and strategy sessions aimed at identifying better ways to differentiate Lake
shore from the competition through unique capabilities, value-added expertise, and highly
personalized service. the result has been more high-quality commercial loans on our books,
as well as a re-energized banking team eager to help our customers succeed and grow their
businesses. We’re already beginning to realize a return on this investment, as we delivered
commercial real estate loan growth of $9.5 million, a 16.2% increase from year-end 2013.
not only does this focus on commercial lending more effectively position Lake shore for
long-term profitable growth, but it also aligns with the growing optimism that we are hearing
from our customers. Whether it’s a hardware store in a small hamlet or a manufacturing firm
Since 2009, we have
grown core deposits
by nearly 60% to
$204.8 million.
Core Deposit Growth
In millions; At 12 /31
$400
$300
$200
$100
'10
'11
'12
'13
'14
COR E
T IME
TOTAL
l a k e s h o r e Ba n c o rP , i n c.
1
expanding in the outskirts of Buffalo, there is renewed enthusiasm toward investing in growth
that Lake shore can help fund and facilitate. Further, we are also seeing signs of a ripple effect
from the emerging revitalization of downtown Buffalo. Beyond the potential business and
lending opportunities for Lake shore, the improving economic climate in Buffalo has positive
implications for the entire region.
invested in technology, committed to efficiency
another key area of focus has been the advancement and implementation of a robust digital
platform that now offers our retail and commercial customers a full suite of capabilities that
allow for convenient, swift and secure online transactions. Enhancements include the launch of
mobile banking for retail use, improved bill payment services, and enhanced cash management
applications for small businesses and commercial customers. While doing business with a smile
and a handshake will always be core to Lake shore’s relationship strategy, we also know that
customers want access to a full range of channels and user-friendly options to transact their
banking at any time, from wherever they may be.
investing in new technology not only makes banking easier and more convenient for our
customers, but also benefits our Company by enabling improved, more streamlined processes
that facilitate cost-savings or improve productivity. Maintaining an efficient expense profile is
an essential tool for financial health and competitiveness in the current banking environment.
Cost efficiency is also critical in the face of increased regulation that continues to demand more
of the time, expertise and resources of local community banks such as Lake shore.
Delivering sound Financial Performance
our 2014 results reflect our measured long-term approach to managing our business along
with a commitment to deliver solid and sustainable returns to Lake shore shareholders.
throughout 2014 we focused on reducing the term of our interest-earning assets, while at the
same time reducing our dependence on higher-cost fixed-rate time deposits. We sold longer-
term securities and mortgage loans and reinvested the proceeds in interest-earning assets of
shorter duration, while also focusing on growing our lower-cost core deposit funding base.
in the near-term this impacts profitability, but over the longer-term positions the Bank for
stronger performance and growth.
For 2014, we reported net income of $3.2 million, or $0.55 per diluted share, compared to net
income of $3.7 million, or $0.65 per diluted share, for 2013. our total assets grew by more than
$5 million to $487 million at year end, up from $482 million on December 31, 2013, and driven
by growth in our commercial real estate loan portfolio of $9.5 million. our focus on growing
transaction and savings accounts yielded solid core deposit growth of $9.2 million or 4.7% at
2014 year end. since 2009, we have grown core deposits by nearly 60%, to $204.8 million.
and, despite some upward movement in classified loans during the year, non-performing loans
as a percentage of total loans were 1.66% at December 31, 2014, or 38 basis points below the
average non-performing loans ratio for all national savings institutions as of December 31, 2014.
Further, our 2014 performance helped fortify our already solid capital base, with capital ratios
exceeding all applicable regulatory requirements for well-capitalized banks. on December 31,
2014, the Bank’s total capital to risk-weighted assets ratio was 25.71%, an increase of 63 basis
points from 2013 year end. Meanwhile, tier 1 capital to risk-weighted assets of 24.95% was up
59 basis points from December 31, 2013.
Lake shore’s Board of Directors continued to leverage the strength of the Bank’s capital position
to consistently enable us to pay cash dividends to shareholders. our capacity to consistently
deploy capital in the form of shareholder dividends is a steady reminder of the strength of our
bank, as well as the commitment to returning value to shareholders. During 2014, cash dividends
of $0.28 per share of common stock were declared and based on the closing price of $13.56 on
December 31, 2014, the dividend provided an implied return to shareholders of 2.1% for the year.
We’re preparing
for a rising interest
rate environment
by shortening
the duration of
our portfolio.
Loan Portfolio Composition
At 12/31/14
Consumer loans
1%
Commercial loans
5%
Commercial
real estate
24%
Home equity
11%
One-to-four family
59%
2 2 0 1 4 a n nU a l r eP o r t
Building sustainable
shareholder value
is our priority.
Book Value Per Share
At 12 /31
$12.0
$9.0
$6.0
$3.0
'10
'11
'12
'13
'14
the outlook for 2015
although we see a generally improving economy for much of our service area, we expect the
operating environment will remain challenging for community banks that face persistent
headwinds fueled by continued low interest rates and the growing burden of regulatory
requirements. Certainly, a rise in interest rates is inevitable, yet with the Federal reserve
signaling that rates will hold steady until at least mid-2015 or later, our focus is on effectively
adapting to current conditions while positioning ourselves for the future.
We are confident that our proactive steps and solid performance in 2014 will further enhance
our competitive position this coming year. our strong capital and liquidity positions not only
provide a healthy level of insurance against changing economic or industry conditions, but also
the flexibility to leverage opportunities to deploy capital in ways that can help strengthen our
financial foundation and grow our capabilities or franchise.
in 2015, we expect to benefit from the full implementation of our digital banking platform
from both a customer satisfaction and cost-efficiency perspective. While technology changes
at a pace that requires consistent investment, the key elements of our platform are now fully
functional and provide capabilities that match those of many larger banks. We are now
in a strong position to make incremental upgrades and enhancements to assure that our
technology remains current and will not require another large-scale investment in the near
future.
Moving forward, we will also continue to focus on our commercial lending business as we
seek to add high-quality commercial credits to our balance sheet as a strategic step aimed at
moderating future interest rate risk while expanding customer relationships and driving growth
in our core deposit base. our enhanced commercial lending focus is expected to generate more
opportunities to partner with smaller financial institutions, either to originate commercial loans
or participate in some meaningful way in larger lending opportunities. By further developing
these strategic relationships in the regional banking community, we may identify potential
opportunities to strategically grow our franchise or add to our branch network in future years.
of course, none of our past success – or future aspirations – are possible without the very core of
our business – our people. Putting People First encompasses both our customers and employees,
and we remain committed to investing in our people, providing them with the training, tools
and technology to deliver high-value personalized service while doing their jobs in the most
efficient, effective and rewarding ways possible. We are proud of the exceptional team that
we have assembled. the commitment and care they exhibit “on the job” can often be seen
outside of working hours, as many Lake shore employees are deeply involved in community and
charitable efforts.
as noted at the onset of this letter, ours is a win-win strategy. We are committed and well
positioned to provide the financial resources and services to help our neighbors, businesses and
communities thrive — for it is only through their success that we are able to maintain our strength,
achieve our goals, and return long-term value to our shareholders. on behalf of our Board of
Directors, thank you for your continued faith and investment in Lake shore Bancorp, inc.
Daniel P. reininga
President and Chief Executive Officer
Gary W. Winger
Chairman of the Board
From left to right:
Gary W. Winger and
Daniel P. reininga
l a k e s h o r e Ba n c o rP , i n c.
3
Lake shore’s Commercial Banking team
is focused on helping business owners thrive
and grow.
The Right Mix
Appointed as Lake Shore Savings Bank’s
Executive Vice President of the Commercial Division
in August 2014, Jeffrey M. Werdein shares his
insights on the commercial lending environment
in Western New York.
Commercial Lending Focus Supports
Growth, Fortifies Balance Sheet
With Western new York’s economy heading in the right direction, Lake shore savings Bank is focused on
helping businesses build on that momentum.
the promising resurgence of downtown Buffalo has spawned a regional ripple effect of improving economic
activity, particularly in the commercial real estate market. no doubt, some industries in Erie and Chautauqua
counties continue to grapple with the lingering effects of the recession. For others, however, business is picking
up to the extent that more focus is shifting to growth and expansion opportunities.
that business climate aligns well with two of Lake shore’s top priorities – helping local businesses thrive
and grow while also achieving greater diversification of our loan portfolio. the shorter terms and improved
profitability associated with commercial loans enable us to better balance risk and opportunity and enhance
our profitability potential in preparation for a rising interest rate environment.
to that end, in 2014 we elevated our game when it comes to commercial lending. We added talent and
technology and initiated best practices to create greater consistency in how we go to market and leverage
our strengths of local decision making and personalized service. We are seeing positive results. For example,
commercial real estate loans grew by $9.5 million in 2014, representing a year-over-year increase of 16.2%.
our approach is built on four pillars that serve as the foundation for smart and steady commercial loan
growth that stands to benefit Lake shore, our customers, and our shareholders.
> Protect the balance sheet. For smaller community banks such as Lake shore, financial strength and
stability is paramount. We are not pursuing growth for the sake of growth but rather focusing on making
quality loans to good, qualified borrowers with good, qualified projects. We want to be a commercial lender
of first resort and will not sacrifice quality for quantity.
> Pursue a diversified lending portfolio. We continue to add commercial loans to our portfolio as a means
to reduce the term of our interest-earning assets, while also reducing our dependence on higher cost
fixed-rate time deposits. We are focused on diversification within our commercial loan book of business,
making sure we maintain a healthy mix of real estate loans for projects such as multi-family housing, office
space, retail business space and warehouses while also financing sound small business and commercial and
industrial (C&i) enterprises that bolster branch deposits.
> Promote the lake shore difference. Lake shore offers a unique value proposition grounded in our strong
community presence, local decision making, and ready accessibility and flexibility. We don’t have a
1-800 number like many bigger banks. all lending decisions are made locally, not by an out-of-town
loan committee that does not fully appreciate and understand our community or customers.
> Provide personalized service. our commitment to Putting People First extends beyond our retail and
residential customers. Behind every business venture are people aspiring to grow their enterprise and better
their community. as local bankers, we partner with our customers to provide customized solutions and quality
community banking service. We’re all about building relationships that last long beyond that first loan.
We are committed to taking a purposeful and disciplined approach to diversifying our portfolio by adding a
solid mix of commercial loans. over time, we are confident this effort will make us a stronger, more versatile
bank, while building long-term shareholder value.
l a k e s h o r e Ba n c o rP , i n c.
5
the Lake shore savings Bank Mobile app is one of
several recent technology enhancements that allow
customers to do their banking from just about
anywhere, at any time.
We set ourselves
apart by providing
unmatched personal
service to individuals,
small businesses
and community
organizations.
Going Mobile
New Digital Platform Offers Ease,
Convenience for Customers
at Lake shore savings Bank, we pride ourselves in providing the personal
touch. our Putting People First approach means customers are greeted by
friendly and familiar faces at our branches; our commercial bankers meet
business owners on their turf; and a local human voice is just a phone call
away to answer questions or address concerns.
Yet, we also know that providing personalized service increasingly means
leveraging technology to make banking faster, easier and more convenient.
that’s why over the last several years we have made significant investments
in enhancing our digital platform so our customers can bank from just about
anywhere, at any time.
our enhanced digital platform serves to complement our 11 branches in Erie
and Chautauqua counties. Customers now have access to full online banking
capabilities, such as improved bill payment services and mobile banking with
our branded app that allows transactions from smart phones and tablets.
We recently rolled out remote deposit capture that allows retail customers to
scan checks and deposit funds through a mobile device rather than visiting an
atM or branch. small business and commercial customers can also benefit
from enhanced cash management applications.
this digital platform matches capabilities offered by competitor banks — an
important factor as we ramp up our efforts to add more commercial accounts
to our portfolio. in addition, electronic security is a top priority. importantly,
our digital platform features state-of-the art security technology, and our
mobile applications are provided by a reliable, secure source.
new technology doesn’t just make life easier for our customers. the digital
tools also help our staff operate more efficiently, further improving on our
low-cost business model.
ongoing investments in technology make Lake shore more competitive and
efficient while deepening relationships with our customers. that makes for a
stronger bank, and adds long-term value for our shareholders.
sonia ortolano, Lake shore savings Bank Vice President,
Management information systems, checks on a router
that helps facilitate secure online and mobile
banking technologies.
l a k e s h o r e Ba n c o rP , i n c.
7
Executive and Senior
Management Team
Daniel P. reininga
President and Chief Executive Officer
since 2011
aDDi t i on al eX Pe ri en c e
internal: Vice Chairman of Board of Directors,
Executive Vice President and Chief operations officer
external: Chairman of a real estate investment company
rachel a. Foley
Chief Financial Officer and Treasurer
since 2006
aDDi t i on al eX Pe ri en c e
internal: Controller
external: internal auditor positions at M&t Bank
nancy latulip
Vice President, Commercial and
Small Business Lending Erie County
since 2008
aDDi t i on al eX Pe ri en c e
external: retail banking and small business lending postions
at Greater Buffalo savings Bank, First niagara and key Bank
charles D. Brooks
Assistant Vice President,
Commercial Loan Officer
since 2011
aDDi t i on al eX Pe ri en c e
internal: Management trainee, Branch Manager
Janinne Fiegl Dugan
Vice President, Human Resources
since 1994
aDDi t i on al eX Pe ri en c e
internal: Management trainee,
human resources Benefits officer
cynthia guenther
Residential Loan Operations,
Loan Servicing Manager and System Analyst
since 2010
aDDi t i on al eX Pe ri en c e
internal: teller supervisor, Customer service representative
and Mortgage originator
8 2 0 1 4 a n nU a l r eP o r t
Jeffrey m. Werdein
Executive Vice President, Commercial Division
since 2014
aD Ditional eX Perienc e
external: Commercial banking positions with Citibank,
Chase Manhattan, and Evans Bank
Beverly sutton
Internal Auditor
since 1997
aD Ditional eX Perienc e
internal: assistant auditor, security officer
lou DiPalma
Vice President, Commercial and Small Business
Lending Chautauqua County
since 2003
aD Ditional eX Perienc e
internal: Branch Manager
external: Public- and Private-sector management experience
steven schiavone
Controller
since 2008
aD Ditional eX Perienc e
external: Financial and/or tax accounting positions at
Citigroup, Greater Buffalo savings Bank, and M&t Bank
sonia ortolano
Vice President,
Management Information Systems Officer
since 2004
aD Ditional eX Perienc e
internal: teller and Mis assistant
nicole may
Compliance Officer
since 2002
aD Ditional eX Perienc e
internal: security officer, assistant internal auditor
Board of
Directors
gary W. Winger
Chairman of the Board,
Principal, Compass Consulting, Inc.
Director since 1997
B oa rD c o mmi t t e es
asset/Liability
nancy l. Yocum
Vice Chairperson of the Board, retired CPA and
former Partner of Brumfield & Associates
Director since 1995
B oa rD c o mmi t t e es
audit/risk (Chairs Committee)
Daniel P. reininga
President & Chief Executive Officer
Director since 1994
B oa rD c o mmi t t e es
asset/Liability
susan c. Ballard
Chief Operating Officer of
National Fire Adjustment Co., Inc.
Director since 2012
B oa rD c o mmi t t e es
nominating and Governance, Compensation
tracy s. Bennett
CPA and Former Vice President of Administration,
SUNY Fredonia
Director since 2010
B oa rD c o mmi t t e es
audit/risk, asset/Liability
sharon e. Brautigam
Partner, Brautigam & Brautigam, LLP
Director since 2004
Boa rD c omm it tees
nominating and Governance, Compensation
(Chairs nominating and Governance Committee)
reginald s. corsi
Former Executive Vice President and
Chief Operations Officer of Lake Shore Bancorp, Inc.
Director since 2008
Boa rD c omm it tees
audit/risk
David c. mancuso
Former President and Chief Executive Officer
of Lake Shore Bancorp, Inc.
Director since 1998
Boa rD c omm it tees
asset/Liability (Chairs Committee)
kevin m. sanvidge
Chief Executive Officer and Administrative Director of the
Chautauqua County Industrial Development Agency
Director since 2012
Boa rD c omm it tees
nominating and Governance, Compensation
(Chairs Compensation Committee)
l a k e s h o r e Ba n c o rP , i n c.
9
Selected Financial Data
our selected consolidated financial and other data is set forth below, which is derived in part from, and should be read in conjunction with
our audited consolidated financial statements and notes thereto, beginning on page F-1 of our 2014 annual report on Form 10-k.
as of December 31,
2014
2013
2012
2011
2010
Selected Financial Condition Data
(Dollars in thousands)
Total assets
Loans, net
$ 487,471 $ 482,167 $ 482,387 $ 488,597 $ 479,047
284,853
277,345
272,933
275,068
263,031
Securities available for sale
138,202
157,964
159,368
164,165
153,924
Federal Home Loan Bank stock
Total cash and cash equivalents
1,375
35,811
1,560
17,202
1,852
19,765
2,219
23,704
2,401
33,514
Total deposits
Short-term borrowings
Long-term debt
Total stockholders’ equity
Allowance for loan losses
Non-performing loans
Non-performing assets
386,939
388,235
378,543
379,798
375,785
-0-
18,950
71,630
1,921
4,729
5,130
11,650
7,850
65,271
1,813
4,606
5,187
11,200
14,400
66,985
1,806
2,420
3,000
6,910
27,230
63,947
1,366
2,798
3,113
5,000
34,160
55,210
953
2,341
2,645
For the year ended December 31,
2014
2013
2012
2011
2010
Selected Operating Data
(Dollars in thousands, except per share data)
Interest income
Interest expense
Net interest income
Provision for loan losses
Net interest income after
provision for loan losses
Total non-interest income
Total non-interest expense
Income before income taxes
Income taxes
Net income
Basic earnings per common share
Diluted earnings per common share
Dividends declared per share
10 2 0 1 4 a n nU a l r eP o r t
$
17,879 $
18,614 $
19,650 $
20,765 $
19,926
3,348
3,556
4,603
5,636
6,316
14,531
15,058
15,047
15,129
222
105
656
415
14,309
2,235
12,819
3,725
567
14,953
2,092
12,334
4,711
968
14,391
2,030
11,811
4,610
984
14,714
1,666
11,307
5,073
1,393
13,610
2,115
11,495
3,454
11,533
3,416
373
$
$
$
$
3,158 $
3,743 $
3,626 $
3,680 $
3,043
0.55 $
0.66 $
0.64 $
0.65 $
0.55 $
0.65 $
0.64 $
0.65 $
0.28 $
0.28 $
0.25 $
0.28 $
0.53
0.53
0.24
Selected Financial Ratios and Other Data
at or for the year ended December 31,
2014
2013
2012
2011
2010
Performance Ratios
Return on average assets
Return on average equity
Dividend payout ratio1
Interest rate spread 2
Net interest margin3
Efficiency ratio4
Non-interest expense to average
total assets
Average interest-earning assets to
average interest-bearing liabilities
Capital Ratios
Total risk-based capital to risk
weighted assets5
Tier 1 risk-based capital to risk
weighted assets5
Tangible capital to tangible assets5
Tier 1 leverage (core) capital to
adjustable tangible assets5
Equity to total assets
Asset Quality Ratios
Non-performing loans
as a percent of total net loans
Non-performing assets
as a percent of total assets
Allowance for loan losses
as a percent of total net loans
Allowance for loan losses
as a percent of non-performing loans
Other Data
Number of full service offices
0.65%
4.58%
50.91%
3.06%
3.21%
76.46%
0.77%
5.64%
43.08%
3.19%
3.34%
71.92%
0.74%
5.47%
39.06%
3.07%
3.26%
69.16%
0.76%
6.15%
43.08%
3.14%
3.34%
67.32%
0.67%
5.32%
45.28%
2.98%
3.21%
67.59%
2.63%
2.55%
2.40%
2.34%
2.54%
120.93%
119.39%
119.69%
116.58%
115.39%
25.71%
25.08%
23.77%
21.81%
20.44%
24.95%
13.16%
13.16%
14.69%
24.36%
12.75%
12.75%
13.54%
23.04%
12.14%
12.14%
13.89%
21.27%
11.18%
11.18%
13.09%
20.05%
10.28%
10.28%
11.52%
1.66%
1.66%
0.89%
1.02%
0.89%
1.05%
1.08%
0.62%
0.64%
0.55%
0.67%
0.65%
0.66%
0.50%
0.36%
40.62%
39.36%
74.63%
48.82%
40.71%
11
11
10
10
10
1 Represents dividends declared per share as a percent of diluted earnings per share.
2 Represents the difference between the weighted-average yield on interest-earning assets and the weighted-average cost of interest-bearing liabilities for the year.
3 Represents the net interest income as a percent of average interest-earning assets for the year.
4 Represents non-interest expense divided by the sum of net interest income and non-interest income.
5 Represents the capital ratios of Lake Shore Savings Bank since Lake Shore Bancorp, Inc., as a savings and loan holding company, is not currently subject
to formula-based capital requirements at the holding company level.
Cautionary Statement
The statements contained herein that are not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which statements generally
can be identified by the use of forward-looking terminology, such as “may,” “will,” “expect,” “estimate,” “anticipate,” “believe,” “target,” “plan,” “project” or “continue” or the negatives thereof or
other variations thereon or similar terminology, and are made on the basis of management’s current plans and analyses of our business and the industry in which we operate as a whole. These factors
in some cases have affected, and in the future could affect, our financial performance and could cause actual results to differ materially from those expressed in or implied by such forward-looking
statements. Information on factors that could affect the Company’s business and results are discussed in the Company’s periodic reports filed with the Securities and Exchange Commission including
the Company’s annual report on Form 10-K for 2014. We do not undertake to publicly update or revise our forward-looking statements even if experience or future changes make it clear that any
projected results expressed or implied therein will not be realized.
l a k e s h o r e Ba n c o rP , i n c.
11
erie county
570 Dick road
Depew, new York 14043
Phone 716-898-2022
FaX 716-684-5069
5751 transit road
East amherst, new York 14051
Phone 716-688-6114
FaX 716-688-5941
59 Main street
hamburg, new York 14075
Phone 716-646-9480
FaX 716-646-9481
3438 Delaware avenue
kenmore, new York 14217
Phone 716-898-2010
FaX 716-874-2057
3111 union road
orchard Park, new York 14127
Phone 716-674-2066
FaX 716-674-4347
4950 Main street
snyder, n Y 14226
Phone 716- 898-2101
FaX 716- 839-1404
Branch
Locations
chautauqua county
128 East Fourth street
Dunkirk, new York 14048
Phone 716-366-4070
FaX 716-366-2965
30 East Main street
Fredonia, new York 14063
Phone 716-673-9555
FaX 716-679-0696
115 East Fourth street
Jamestown, new York 14701
Phone 716-664-1103
FaX 716-664-1183
1 Green avenue, WE
Lakewood, new York 14701
Phone 716-483-3400
FaX 716-483-3468
106 East Main street
Westfield, new York 14787
Phone 716-326-4414
FaX 716-326-4422
BUFFalo
H
DUnkirk
Corporate Headquarters
Branch Location
12 2 0 1 4 a n nU a l r eP o r t
Shareholder
Information
annual shareholders meeting
May 20, 2015
8:30 a.m.
Clarion hotel
the Lighthouse room
30 Lake shore Drive East
Dunkirk, nY 14048
national stock listing
the nasDaQ Global Market
under the symbol LsBk
special counsel
Luse Gorman, PC
5335 Wisconsin avenue, nW
suite 780
Washington, DC 20015
independent auditors
Baker tilly Virchow krause, LLP
20 stanwix street
suite 800
Pittsburgh, Pa 15222
transfer agent and registrar
Computershare shareholder services
P.o. Box 30170
College station, tX 77842-3170
(800) 368-5948
www.computershare.com/investor
investor relations contact
rachel a Foley
Chief Financial officer/treasurer
(716) 366-4070 option 4 ext 1220
rachel.foley@lakeshoresavings.com
Officers & Directors
7.8%
Individuals
19.7%
shareholder Profile
At 12/31/14
Lake Shore MHC
60.7%
Institutions
11.8%
Lake Shore Savings
Bank Officers
Daniel P. reininga
President and Chief Executive Officer
Charles D. Brooks
Assistant Vice President
Jeffrey M. Werdein
Executive Vice President, Commercial Division
theresa M. Campanella
Assistant Vice President
adam J. Dimitri
Assistant Vice President
Magdalena Dye
Assistant Vice President
Barbara M. Fancher
Assistant Vice President
Gabriele J. Maddalena
Assistant Vice President
nancy L. March
Assistant Vice President
sally a. Pyne
Assistant Vice President
rachel a. Foley
Chief Financial Officer and Treasurer
Janinne Fiegl Dugan
Vice President, Human Resource Officer
nicole May
Compliance Officer
sonia n. ortolano
Vice President, MIS Officer
steven schiavone
Controller
Beverly J. sutton
Internal Auditor
Wendy J. harrington
Corporate Secretary
Louis P. DiPalma
Vice President
John P. huber
Vice President
nancy L. Latulip
Vice President
Beverley J. Mulkin
Vice President
David P. Warren
Vice President
l a k e s h o r e Ba n c o rP , i n c.
13
o u r Mi s s i o n
At Lake Shore Savings, Putting People First means helping
our Customers, energizing our Employees, respecting our
Shareholders, and serving the Communities in our region.
Lake Shore’s Mission is to deliver outstanding customer
service and financial assistance to customers, building
lasting relationships, and assisting customers in achieving
their financial goals. Lake Shore Professionals will meet
Customer and Bank needs in an environment providing
professional growth opportunities and fair rewards.
We will be responsive to our Shareholders by maintaining
a strong financial position as an independent bank with
an emphasis on profitability, fair Shareholder returns,
and bank safety and soundness. We will build on our
success as a locally operated financial institution, to serve
the financial needs of our Communities.
3 1 E a s t F o u r t h s t rE Et D u n k i r k , nY 1 4 0 4 8 7 1 6 . 3 6 6 . 4 0 7 0
l a k e s h o r e s av i n g s . c o m n a sD a Q : l sBk