Exhibit 99.2
United Bancshares, Inc.
Quarterly Report
September 30, 2008
Dear Shareholders, Customers and Employees,
As you are all aware, the financial markets have experienced a considerable amount of distress over these past months. The impact of the situation is extensive and even the healthiest of companies are experiencing the adverse effects. Despite this increasingly challenging environment, I am pleased to report that your company increased its third quarter and year-to-date net income by 20.5% and 13.5%, respectively.
This increase in net income was accomplished primarily as the result of increases in both net interest income after an increased provision for loan losses and non-interest income, as well as management’s ongoing commitment to controlling non-interest expenses. Net interest income was improved by the Company’s growth in loan and deposit balances, while maintaining a 3.65% net interest margin for the first nine months of 2008. Although 2008 year-to-date non-interest expenses increased 4.2 percent compared with 2007, the Company’s income sources increased at a higher rate. This is reflected in the Company’s improved year-to-date efficiency ratio from 66.35% in 2007 to 61.60% in 2008.
Since it is currently expected that the market disruption will continue through 2008 and beyond, management expects to be confronted with various challenges throughout this period. Management has and will continue to operate using prudent banking principles and will work hard to add shareholder value. We appreciate the continued confidence that you have placed in your management and company.
Respectfully,
Daniel W. Schutt
President & CEO
United Bancshares, Inc.
and Subsidiary
| | | |
Financial Information (unaudited) | Nine months ended Sept. 30, 2008 | | Nine months ended Sept. 30, 2007 |
(dollars in thousands, except share data) | | | |
CONDENSED STATEMENT OF INCOME | | | |
Interest income | $26,533 | | $25,936 |
Interest expense | 12,039 | | 13,066 |
Net interest income | 14,494 | | 12,870 |
Provision for loan losses | 1,245 | | 400 |
Net interest income after provision for loan losses | 13,249 | | 12,470 |
Non-interest income | 2,620 | | 2,312 |
Non-interest expenses | 10,992 | | 10,547 |
Income before income taxes | 4,877 | | 4,235 |
Provision for income taxes | 1,056 | | 868 |
Net income | $ 3,821 | | $ 3,367 |
| | | | |
Average common shares outstanding | 3,449,508 | | 3,535,681 |
| | | | |
PER COMMON SHARE | | | |
Net income | $1.11 | | $0.95 |
Cash dividends | $0.45 | | $0.42 |
Book value | $14.48 | | $13.57 |
Closing price | $10.32 | | $14.89 |
| | | | |
FINANCIAL RATIOS | | | |
Return on average assets | 0.86% | | 0.81% |
Return on average equity | 10.27% | | 9.57% |
Net interest margin | 3.65% | | 3.59% |
Efficiency ratio | 61.60% | | 66.35% |
Loans to deposits | 89.09% | | 88.70% |
Allowance for loan losses to loans | 0.71% | | 0.59% |
Cash dividends to net income | 40.53% | | 43.95% |
| | | | |
PERIOD END BALANCES | | | |
| | As of Sept. 30, 2008 | | As of Dec. 31, 2007 |
Assets | $619,814 | | $547,975 |
Loans (including available-for-sale) | $407,155 | | $359,560 |
Deposits | $456,994 | | $393,203 |
Shareholders' equity | $49,838 | | $48,819 |
| | | | |
Common shares outstanding | 3,441,663 | | 3,489,405 |
DIRECTORS/OFFICERS
UNITED BANCSHARES, INC.
Robert L. Benroth
David P. Roach
H. Edward Rigel
R. Steven Unverferth
James N. Reynolds - Chairman
Robert L. Dillhoff - Vice-Chairman
Daniel W. Schutt - President/CEO
Heather M. Oatman - Secretary
Brian D. Young - CFO/Executive V.P./Treasurer
DIRECTORS
THE UNION BANK CO.
Robert L. Benroth
James N. Reynolds
Robert L. Dillhoff
H. Edward Rigel
Herbert H. Huffman
David P. Roach
Kevin L. Lammon
Robert M. Schulte, Sr.
William R. Perry
R. Steven Unverferth
Daniel W. Schutt - President/CEO/Chairman
INVESTOR MATERIALS:
United Bancshares, Inc. has traded its common stock on the Nasdaq Markets Exchange under the symbol “UBOH” since March 2001. Annual and quarterly shareholder reports, regulatory filings, press releases, and articles about The Union Bank Company are available in the Shareholder Information section of our website www.theubank.com or by calling 1-800-837-8111.
Locations
1300 N. Main St.
Bowling Green, OH 43402
419-353-6088
100 S. High St.
Columbus Grove, OH 45830
419-659-2141
101 Progressive Dr.
Columbus Grove, Ohio 45830
419-659-4250
114 E. 3rd St.
Delphos, OH 45833
419-692-2010
230 W. Madison St.
Gibsonburg, OH 43431
419-637-2124
110 E. North St.
Kalida, OH 45853
419-532-3366
318 S. Belmore St.
Leipsic, OH 45856
419-943-2171
215 W. Market St.
Lima, OH 45801
419-228-2114
1410 Bellefontaine Ave.
Lima, OH 45804
419-229-6500
3211 Elida Rd.
Lima, OH 45805
419-331-3211
245 W. Main St.
Ottawa, OH 45875
419-523-2265
132 E. Front St.
Pemberville, OH 43450
419-287-3211
