LSB to Open Office in Tyro Community.

Business Editors

LEXINGTON, N.C.--(BUSINESS WIRE)--Sept. 19, 2001

LSB Bancshares, Inc. (NASDAQ:LXBK), parent company of Lexington State Bank, has announced approval by the State Banking Commission and the FDIC for LSB to open its 24th banking office in the growing Tyro community in western Davidson County.

B. Eugene "Gene" Klump, Jr., elected Vice President by LSB Bancshares directors in August, is responsible for developing the new office, planned for opening in late 2001 or early 2002.

LSB Chairman, President and Chief Executive Officer Robert F. Lowe, said, "This expansion to Tyro complements our strategic plan and is the third new LSB office in the Triad this year. We opened our new Clemmons village office in March and, in July, established a Loan Production Office in High Point as our initial service to citizens of Guilford County."

Lowe continued, "LSB banking for the Tyro community has until now been provided by our West Side Shopping Center, Welcome and Arcadia offices. Tyro and western Davidson County are quickly becoming home to many new residents who live there and travel to work in Davidson County and the Triad. We're also aware of the development of small businesses in the Tyro area."

LSB Executive Vice President and Chief Operating Officer, Frank Sherron, said, "In addition to the requests we've received to open an office there, the growth in the Tyro community, flanked by Reeds to the north and Churchland to the south, clearly reflects the need for LSB's banking services.

"Population grew 27% between 1990 and 2000," Sherron cited, "and that followed an appreciable increase of over 23% in the prior decade. At the last count, there were over 5,700 households in the census tract with a population of approximately 15,000 people."

LSB has begun renovations of a building at 4481 South N.C. Highway 150, across from Tyro United Methodist Church. The office, about 2,000 square feet when complete, will provide commercial and consumer deposit and loan services. To assist families in the growing area, LSB will provide home loan origination and alternative investments by way of LSB Investment Services. Customer convenience will be enhanced by a two-lane drive-up and ATM.

Gene Klump, a 1971 graduate of West Davidson High School, graduated from Appalachian State University in 1975 and received a Masters' degree from Gardner-Webb University in 1990. Klump began teaching in the Davidson County schools in 1975 and was a teacher and the Athletic Director at West Davidson when he joined LSB in August, 1999.

During his 23 years in education and athletics, Klump served as president of the Central Carolina, Central Tarheel and Yadkin Valley Conferences. He also served the North Carolina High School Athletic Association as a member of its Student Services Advisory Board and Board of Directors. He was selected "Athletic Director of the Year" for the NCHSAA Region Five.

About Klump, Sherron said, "Gene brings a familiarity of that community to LSB and will put together an experienced staff to deliver all of our services conveniently and efficiently to those in the area."

Klump and his wife, the former Connie Blythe, are the parents of two daughters and live in Reeds.

With nearly $800 million in assets, LSB is the state's 10th largest bank and the largest community bank in the Triad counties of Davidson, Guilford, Forsyth and Stokes.

LSB, which opened July 5, 1949, currently has seven banking offices in Lexington, three offices in Thomasville, two offices in Winston-Salem, a Loan Production Office in High Point and one office each in Arcadia, Clemmons, Danbury, Kernersville, King, Midway, Rural Hall, Walkertown, Wallburg and Welcome.

Common stock of the bank's parent company, LSB Bancshares, Inc., is traded in the Over-The-Counter National Market System and is quoted electronically under the NASDAQ symbol LXBK. The LSB web site and access to LSB by Net online banking is www.lsbnc.com.