Lake Shore Bancorp Inc. reported unaided earnings results for the fourth quarter and year ended December 31, 2014. For the period, the company reported interest income was $4,419,000 against $4,706,000 a year ago. Net interest income was $3,578,000 against $3,845,000 a year ago. Income before income taxes was $876,000 against $1,407,000 a year ago. Net income was $796,000 against $1,051,000 a year ago. Diluted earnings per share was $0.14 per share against $0.18 against a year ago. Return on average assets was 0.66% against $0.87% a year ago. Return on average equity was $4.49% against 6.36% year ago. Lower interest income for the quarter was the result of a 30 basis point decrease in the average interest rate for earning assets, reflecting a shift of a portion of the Banks interest earning assets into shorter-duration and lower yield liquid alternatives. Fourth quarter 2014 interest expense declined by $20,000 compared to fourth quarter 2013, a result of a $5.3 million decrease in the average balance of interest bearing liabilities.

For the year, the company reported interest income was $17,879,000 against $18,614,000 a year ago. Net interest income was $14,531,000 against $15,058,000 a year ago. Income before income taxes was $3,725,000 against $4,711,000 a year ago. Net income was $3,158,000 against $3,743,000 a year ago. Diluted earnings per share was $0.55 per share against $0.65 against a year ago. Return on average assets was 0.65% against $0.77% a year ago. Return on average equity was $4.58% against 5.64% year ago. The decline in net income for the quarter and year was largely attributable to the Banks ongoing strategy to better position its interest earning assets for a rising interest rate environment.