Exhibit 99.2
United Bancshares, Inc.
Quarterly Report
June 30, 2005
Dear Shareholders, Customers and Employees,
The management of United is pleased with the results for the second quarter of 2005. United’s net interest income and efficiency ratio continue to improve, while non-interest expenses only increased a modest 3.5% for the six-month period ended June 30, 2005, compared to the same period of 2004. In addition to these improvements in the income statement, the balance sheet reflected positive trends, including loan growth that continued throughout the second quarter of 2005.
This improved performance led to $2,216,000 ($0.60 basic earnings per share) in net income for the six months ended June 30, 2005, compared to net income of $1,608,000, ($0.44 basic earnings per share) for the same period in 2004, a 37.8% increase. The increase in net income for the six-month period was largely the result of an increase of $1,520,000 in net interest income. This increase was offset by increases in non-interest expenses of $243,000, provision for loan losses of $100,000 and the provision for income taxes of $448,000, and a decrease of $121,000 in non-interest income.
We appreciate the support of the shareholders, our valued customers and our many dedicated employees. We will continue to work aggressively to improve your organization.
Respectfully,
/s/ Daniel W. Schutt
Daniel W. Schutt
President/CEO
United Bancshares, Inc.
and Subsidiary
Financial Highlights (unaudited)
Six Months
Six Months
Ended
Ended
June 30, 2005
June 30, 2004
(dollars in thousands, except share data)
CONDENSED STATEMENT OF INCOME
Interest income
$14,815
$12,563
Interest expense
5,786
5,054
Net interest income
9,029
7,509
Provision for loan losses
325
225
Net interest income after provision for loan losses
8,704
7,284
Non-interest income
1,367
1,488
Non-interest expenses
7,155
6,912
Income before income taxes
2,916
1,860
Provision for income taxes
700
252
Net income
$2,216
$1,608
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Average common shares outstanding
3,706,630
3,660,490
PER COMMON SHARE
Net income
$0.60
$0.44
Cash dividends
$0.24
$0.22
Book value
$12.23
$11.08
Closing price
$15.07
$15.75
FINANCIAL RATIOS
Return on average assets
0.80%
0.65%
Return on average equity
10.04%
7.50%
Net interest margin
3.59%
3.49%
Efficiency ratio
66.10%
73.71%
Loans to deposits
86.06%
79.62%
Allowance for loan losses to loans
0.92%
0.84%
Cash dividends to net income
40.15%
50.23%
PERIOD END BALANCES
As of
As of
June 30, 2005
December 31, 2004
Assets
$546,509
$559,323
Loans
$312,820
$305,790
Deposits
$364,438
$369,767
Shareholders’ equity
$45,351
$44,229
Common shares outstanding
3,707,274
3,688,981
DIRECTORS/OFFICERS
UNITED BANCSHARES, INC.
Robert L. Benroth
H. Edward Rigel
Robert L. Dillhoff
David P. Roach
Joe S. Edwards, Jr.
R. Steven Unverferth
P. Douglas Harter
James N. Reynolds— Chairman
Daniel W. Schutt—President/CEO
Bonita R. Selhorst—Secretary
Brian D. Young—CFO/Treasurer
DIRECTORS
THE UNION BANK CO.
Robert L. Benroth
William R. Perry
Robert L. Dillhoff
James N. Reynolds
Joe S. Edwards, Jr.
H. Edward Rigel
P. Douglas Harter
David P. Roach
Herbert H. Huffman
Robert M. Schulte, Sr.
Kevin L. Lammon
R. Steven Unverferth
James A.O’Neill, M.D.
Daniel W. Schutt—President/CEO/Chairman
INVESTOR MATERIALS:
Annual and quarterly shareholder reports, regulatory filings, press releases, and articles aboutThe Union Bank Company are available in the Shareholder Information section of our website www.theubank.com or by calling 1-800-837-8111.
Office Locations
Bowling Green
1204 W. Wooster St.
419-353-6088
Columbus Grove
100 S. High St.
419-659-2141
Delphos
114 E. 3rd St.
419-692-2010
Gibsonburg
230 W. Madison St.
419-637-2124
Kalida
110 E. North St.
419-532-3366
Leipsic
318 S. Belmore St.
419-943-2171
Lima—Downtown
215 W. Market St.
419-228-2114
Lima—East
1410 Bellefontaine Ave.
419-229-6500
Lima—West
3211 Elida Rd.
419-331-3211
Ottawa
245 W. Main St.
419-523-2265
Pemberville
132 E. Front St.
419-287-3211
