United Community Financial (UCFC) 8-K Ucfc Announces Robust First Quarter Earnings

EXHIBIT 99

275 West Federal Street

Youngstown, Ohio 44503-1203

FOR IMMEDIATE RELEASE

Media Contact:	Investor Contact:
Kathy Bushway	Gary M. Small
Senior Vice President, Marketing	President and Chief Executive Officer
Home Savings Bank	United Community Financial Corp.
(330)742-0638	(330)742-0472
kbushway@homesavings.com

UCFC ANNOUNCES ROBUST FIRST QUARTER EARNINGS

YOUNGSTOWN, Ohio (April 17, 2018) – United Community Financial Corp. (Company) (NASDAQ: UCFC), parent company of Home Savings Bank (Home Savings), announced today net income of $8.6 million and diluted earnings per share (“EPS”) of $0.171 for the quarter ended March 31, 2018. The first quarter of 2017 results included two months of operations from Premier Bank & Trust that was acquired on January 31, 2017. In comparison, the first quarter of 2018 results include a full quarter of operations.

First quarter 2018 highlights:

• Loan growth of 2.7% for the quarter

• Customer deposit growth of 5.8% for the quarter

• Net interest margin improved four basis points to 3.47% for the quarter

• ROA of 1.28%, ROE of 11.44% for the quarter

• Dividend of $0.06 per common share declared

Gary M. Small President and Chief Executive Officer of the Company commented, “I am very pleased with the first quarter results. We achieved excellent loan and deposit growth while margin metrics remained very strong. The investments made in our team and the expansion of our product offerings in 2017, are clearly making a difference in our results today.”

Strong Loan and Deposit Growth

Total loan growth for the first quarter was $57.1 million, or 11.0% on an annualized basis. At March 31, 2018, total net loans aggregated $2.14 billion.

Commercial loan growth was $50.5 million for the quarter ended March 31, 2018, or 24.6% on an annualized basis. Consumer loans increased $5.6 million, or 8.2% annualized, during the same time period. The increase in consumer loans was primarily due to the growth and expansion of indirect auto lending, which grew 16.7% during the first quarter of 2018.

Total customer deposit growth for the first quarter was $104.9 million, or 5.8% for the quarter. Included in that growth was an increase of $21.9 million ofnon-interest bearing deposits, which grew at an annualized rate of 24.7%. The Company experienced deposit gains from all lines of business including commercial, private banking, consumer and public funds. Total customer deposits totaled $1.9 billion at March 31, 2018.

Net Interest Margin Expands

Net interest income totaled $21.5 million and $21.6 million on a fully taxable equivalent (FTE) basis for the quarter ended March 31, 2018, up 2.5% from the quarter ended December 31, 2017. The positive change is a result of a higher level of earning assets compared to the prior period as well as fees associated with the early payoff of loans.    

The net interest margin on a fully taxable equivalent basis was 3.47% for the first quarter, which was four basis points higher than the fourth quarter of 2017. This was partially offset by a lower FTE adjustment of approximately two basis points, due to the tax law change.

Excluding purchase accounting yield adjustments, the net interest margin would have been 8 basis points lower, or 3.39%, for the three months ended March 31, 2018.

Nonperforming Loans to Total Loans Ratio Decreases during the First Quarter

Asset quality remained stable during the first quarter. The ratio of nonperforming loans to total loans was 0.59% at March 31, 2018, which is comparable to what was reported in the previous quarter and the quarter a year ago.

The provision for loan losses totaled $407,000 for the first quarter of 2018, which was down $808,000 in comparison to the prior quarter. Net charge-offs for the quarter, both gross and net, remained negligible. As of March 31, 2018, the Company’s allowance for loan losses to total loans was 1.04%, versus 1.05% at December 31, 2017 and 1.02% at March 31, 2017.

Loans acquired through the acquisition during the first quarter of 2017 were recorded at fair value. When combining the remaining fair value adjustment of $3.3 million and the Company’s allowance, the Company’s allowance as a percentage of total loans increases to 1.20%.

Non-Interest Income

Non-interest income increased to $5.8 million in the first quarter of 2018 from $5.4 million reported in the first quarter of 2017. The Company realized strong gains in insurance agency income, mortgage servicing fees and trust fees along with additional gains on the sale of available for sale securities. Mortgage banking income was up slightly from the same period a year ago even as mortgage rates have climbed. The Company continues to make strides in increasing its share of the business in this segment even in a more difficult operating environment.    

Non-Interest Expense

Non-interest expense was $16.6 million for the first quarter of 2018 compared to $15.3 million in the first quarter of 2017 when merger expense is excluded. The resulting increase is due to higher operating expenses after the acquisition, which occurred on January 31, 2017, with only two months of expense included in the 2017 results. In addition, the Company took advantage of timing opportunities in the market during the latter half of 2017 to add talented employees to expand several lines of business including treasury management, wealth management and commercial lending. The additional staff increased salary expense in the first quarter of 2018 compared to the first quarter of 2017, but also contributed to the deposit and revenue growth success.

Effective Tax Rate

The Company’s effective tax rate on an FTE basis at March 31, 2018 was 18.06% compared to 34.05% at March 31, 2017. The decline was due to the enactment of recent tax legislation.

Dividend to be Paid

On April 17, 2018, the Board of Directors declared a quarterly cash dividend of $0.06 per common share payable May 11, 2018 to shareholders of record at the close of business April 27, 2018.

Conference Call

United Community Financial Corp. will host an earnings conference call on Wednesday, April 18, 2018, at 10:00 a.m. ET., to provide an overview of the Company’s first quarter 2018 results and highlights. The conference call may be accessed by calling1-877-272-7661 ten minutes prior to the start time. Please ask to be joined into the United Community Financial Corp. (UCFC) call. Additionally, a live webcast may be accessed from the Company’s websiteir.ucfconline.com. Click on1st Quarter 2018 Conference Call on our corporate profile page to join the webcast.

United Community Financial Corp.

Home Savings is a wholly owned subsidiary of the Company, offering a full line of commercial, wealth management and consumer banking products and services with 35 retail banking offices (34 in Ohio and one in Pennsylvania). Home Savings also has residential mortgage loan centers servicing Ohio, West Virginia, western Pennsylvania, northern Kentucky, and eastern Indiana. Additional information on the Company, Home Savings and James & Sons Insurance is available at ir.ucfconline.com.

###

When used in this press release, the words or phrases “believes,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project”, “will have”, “can expect” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties, including changes in economic conditions in the Company’s market area, changes in policies by regulatory agencies, fluctuations in interest rates, demand for loans in the Company’s market area and competition that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. The Company cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company advises readers that the factors listed above could affect the Company’s financial performance and could cause the Company’s actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements.

The Company does not undertake, and specifically disclaims any obligation, to release publicly the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

UNITED COMMUNITY FINANCIAL CORP.    

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION    

(Unaudited)    

	March 31,			December 31,
	2018			2017			F/(U)
	(Dollars in thousands)
Assets:
Cash and deposits with banks	$	27,683		$	34,365			-19.4	%
Federal funds sold		19,058			12,515			52.3	%
Total cash and cash equivalents		46,741			46,880			-0.3	%
Securities:
Available for sale, at fair value		257,908			270,561			-4.7	%
Held to maturity (fair value of $78,033 and $82,126, respectively)		80,685			82,911			-2.7	%
Loans held for sale, at lower of cost or market		—			211			-100.0	%
Loans held for sale, at fair value		79,292			83,541			-5.1	%
Loans, net of allowance for loan losses of $21,610 and $21,202		2,061,443			1,999,877			3.1	%
Federal Home Loan Bank stock, at cost		19,324			19,324			0.0	%
Premises and equipment, net		21,795			22,094			-1.4	%
Accrued interest receivable		7,615			8,190			-7.0	%
Real estate owned and other repossessed assets		1,293			1,253			3.2	%
Goodwill		20,221			20,221			0.0	%
Core deposit intangible		1,851			1,934			-4.3	%
Customer list intangible		2,030			2,060			-1.5	%
Cash surrender value of life insurance		62,922			62,488			0.7	%
Other assets		27,587			28,360			-2.7	%
Total assets	$	2,690,707		$	2,649,905			1.5	%
Liabilities and Shareholders’ Equity
Liabilities:
Deposits:
Interest bearing	$	1,528,262		$	1,445,293			5.7	%
Noninterest bearing		376,904			354,970			6.2	%
Customer deposits		1,905,166			1,800,263			5.8	%
Brokered deposits		161,812			156,476			3.4	%
Total deposits		2,066,978			1,956,739			5.6	%
Borrowed funds:
Federal Home Loan Bank advances
Long-term advances		48,731			48,536			0.4	%
Short-term advances		245,000			308,000			-20.5	%
Total Federal Home Loan Bank advances		293,731			356,536			-17.6	%
Repurchase agreements and other		233			197			18.3	%
Total borrowed funds		293,964			356,733			-17.6	%
Advance payments by borrowers for taxes and insurance		18,444			25,038			-26.3	%
Accrued interest payable		1,363			1,097			24.2	%
Accrued expenses and other liabilities		13,763			16,033			-14.2	%
Total liabilities		2,394,512			2,355,640			1.7	%
Shareholders’ Equity:
Preferredstock-no par value; 1,000,000 shares authorized and no shares outstanding		—			—			0.0	%
Commonstock-no par value; 499,000,000 shares authorized; 54,138,910 shares issued and 49,882,491 and 49,800,126 shares, respectively, outstanding		177,297			177,458			-0.1	%
Retained earnings		173,419			167,852			3.3	%
Accumulated other comprehensive loss		(22,675	)		(18,685	)		21.4	%
Treasury stock, at cost, 4,256,419 and 4,338,784 shares, respectively		(31,846	)		(32,360	)		-1.6	%
Total shareholders’ equity		296,195			294,265			0.7	%
Total liabilities and shareholders’ equity	$	2,690,707		$	2,649,905			1.5	%

UNITED COMMUNITY FINANCIAL CORP.    

CONSOLIDATED STATEMENTS OF OPERATIONS    

(Unaudited)    

	For the Three Months Ended
	March 31, 2018			December 31, 2017			F/(U)			March 31, 2017			F/(U)
	(Dollars in thousands, except per share data)
Interest income
Loans	$	22,759		$	21,529			5.7	%	$	17,558			29.6	%
Loans held for sale		858			886			-3.2	%		661			29.8	%
Securities:
Available for sale, nontaxable		388			416			-6.7	%		418			-7.2	%
Available for sale, taxable		1,215			1,222			-0.6	%		1,602			-24.2	%
Held to maturity, nontaxable		51			51			0.0	%		62			-17.7	%
Held to maturity, taxable		422			421			0.2	%		465			-9.2	%
Federal Home Loan Bank stock dividends		280			267			4.9	%		214			30.8	%
Other interest earning assets		77			57			35.1	%		80			-3.8	%
Total interest income		26,050			24,849			4.8	%		21,060			23.7	%
Interest expense
Deposits		3,097			2,603			-19.0	%		1,621			-91.1	%
Federal Home Loan Bank advances		1,420			1,365			-4.0	%		955			-48.7	%
Repurchase agreements and other		—			1			100.0	%		8			100.0	%
Total interest expense		4,517			3,969			-13.8	%		2,584			-74.8	%
Net interest income		21,533			20,880			3.1	%		18,476			16.5	%
Taxable equivalent adjustment		97			221			-56.1	%		237			-59.1	%
Net interest income (FTE) (1)		21,630			21,101			2.5	%		18,713			15.6	%
Provision for loan losses		407			1,215			66.5	%		1,475			72.4	%
Net interest income after provision for loan losses (FTE)		21,223			19,886			6.7	%		17,238			23.1	%
Non-interest income
Insurance agency income		577			552			4.5	%		473			22.0	%
Brokerage income		272			264			3.0	%		322			-15.5	%
Service fees and other charges:
Deposit related fees		1,300			1,436			-9.5	%		1,290			0.8	%
Mortgage servicing fees		812			780			4.1	%		735			10.5	%
Mortgage servicing rights valuation		9			6			50.0	%		(3	)		-400.0	%
Mortgage servicing rights amortization		(500	)		(518	)		-3.5	%		(448	)		11.6	%
Other service fees		38			42			-9.5	%		29			31.0	%
Net gains (losses):
Securities available for sale		139			—			100.0	%		29			379.3	%
Mortgage banking income		1,358			1,375			-1.2	%		1,323			2.6	%
Real estate owned and other repossessed assets charges, net		(78	)		(46	)		69.6	%		(52	)		-100.0	%
Debit/credit card fees		949			995			-4.6	%		923			2.8	%
Trust fee income		469			467			0.4	%		282			100.0	%
Other income		474			1,107			-57.2	%		481			-1.5	%
Totalnon-interest income		5,819			6,460			-9.9	%		5,384			8.1	%
Non-interest expense
Salaries and employee benefits		9,998			8,347			-19.8	%		8,975			-11.4	%
Occupancy		1,100			1,023			-7.5	%		964			-14.1	%
Equipment and data processing		2,154			2,256			4.5	%		2,079			-3.6	%
Financial institutions tax		496			300			-65.3	%		490			-1.2	%
Advertising		235			317			25.9	%		124			-89.5	%
Amortization of intangible assets		113			114			0.9	%		83			-36.1	%
FDIC insurance premiums		290			249			-16.5	%		188			-54.3	%
Other insurance premiums		109			113			3.5	%		112			2.7	%
Professional fees:
Legal fees		299			155			-92.9	%		229			-30.6	%
Other professional fees		391			461			15.2	%		520			24.8	%
Supervisory fees		42			84			50.0	%		—			0.0	%
Real estate owned and other repossessed asset expenses		36			17			-111.8	%		62			41.9	%
Acquisition related expenses		—			39			0.0	%		4,962			0.0	%
Other expenses		1,337			3,854			65.3	%		1,502			11.0	%
Totalnon-interest expenses		16,600			17,329			4.2	%		20,290			18.2	%
Income before income taxes		10,442			9,017			15.8	%		2,332			347.8	%
Taxable equivalent adjustment		97			221			56.1	%		237			59.1	%
Income tax expense		1,789			4,294			58.3	%		557			-221.2	%
Net income	$	8,556		$	4,502			90.0	%	$	1,538			456.3	%
Earnings per common share:
Basic	$	0.172		$	0.090			91.1	%	$	0.032			437.5	%
Diluted		0.171			0.090			90.0	%		0.032			434.4	%

⁽¹⁾ Net interest income is also presented on a fully taxable equivalent (FTE) basis, the Company believes thisnon-GAAP measure is the preferred industry measurement for this item.

UNITED COMMUNITY FINANCIAL CORP.    

CONSOLIDATED AVERAGE BALANCES    

(Unaudited)    

	For the three months ended
	March 31, 2018							December 31, 2017							March 31, 2017
	Average outstanding balance		Interest earned/ paid		Yield/ rate			Average outstanding balance		Interest earned/ paid		Yield/ rate			Average outstanding balance		Interest earned/ paid		Yield/ rate
	(Dollars in thousands)
Interest earning assets:
Net loans(1)	$	2,026,266	$	22,760		4.49	%	$	1,975,847	$	21,531		4.36	%	$	1,706,009	$	17,560		4.12	%
Loans held for sale		80,681		858		4.31	%		88,247		886		4.02	%		67,860		661		3.90	%
Total loans, net		2,106,947		23,618		4.49	%		2,064,094		22,417		4.34	%		1,773,869		18,221		4.11	%
Securities:
Available for sale-taxable		211,332		1,215		2.30	%		214,631		1,222		2.28	%		287,775		1,602		2.23	%
Available for sale-nontaxable(2)		54,737		472		3.45	%		58,903		609		4.14	%		59,361		621		4.18	%
Held to maturity-taxable		72,627		422		2.32	%		75,136		421		2.24	%		83,655		465		2.22	%
Held to maturity-nontaxable(2)		9,227		63		2.73	%		9,233		77		3.34	%		12,451		94		3.02	%
Total securities		347,923		2,172		2.50	%		357,903		2,329		2.60	%		443,242		2,782		2.51	%
Federal Home Loan Bank stock		19,324		280		5.80	%		19,324		267		5.53	%		18,905		214		4.53	%
Other interest earning assets		22,479		77		1.39	%		22,656		57		1.01	%		43,059		80		0.74	%
Total interest earning assets		2,496,673		26,147		4.19	%		2,463,977		25,070		4.07	%		2,279,075		21,297		3.74	%
Non-interest earning assets		176,785							179,023							166,070
Total assets	$	2,673,458						$	2,643,000						$	2,445,145
Interest bearing liabilities:
Deposits:
Checking accounts	$	593,499		687		0.47	%	$	600,249		589		0.39	%	$	564,903		337		0.24	%
Savings accounts		303,639		27		0.04	%		304,229		27		0.04	%		301,675		30		0.04	%
Certificates of deposit
Customer certificates of deposit		581,858		1,817		1.27	%		530,297		1,458		1.10	%		468,686		1,073		0.92	%
Brokered certificates of deposit		165,169		566		1.39	%		164,147		529		1.29	%		99,380		181		0.73	%
Total certificates of deposit		747,027		2,383		1.28	%		694,444		1,987		1.14	%		568,066		1,254		0.88	%
Total interest bearing deposits		1,644,165		3,097		0.76	%		1,598,922		2,603		0.65	%		1,434,644		1,621		0.45	%
Federal Home Loan Bank advances
Long-term advances		48,603		431		3.60	%		48,409		404		3.34	%		47,823		349		2.92	%
Short-term advances		265,322		989		1.51	%		301,424		961		1.28	%		347,050		606		0.70	%
Total Federal Home Loan Bank advances		313,925		1,420		1.83	%		349,833		1,365		1.56	%		394,873		955		0.97	%
Repurchase agreements and other		213		—		0.00	%		2,114		1		0.19	%		1,051		8		3.04	%
Total borrowed funds		314,138		1,420		1.83	%		351,947		1,366		1.55	%		395,924		963		0.97	%
Total interest bearing liabilities	$	1,958,303		4,517		0.94	%	$	1,950,869		3,969		0.81	%	$	1,830,568		2,584		0.56	%
Non-interest bearing liabilities
Total noninterest bearing deposits		375,142							355,225							306,402
Other noninterest bearing liabilities		40,729							41,400							33,898
Total noninterest bearing liabilities		415,871							396,625							340,300
Total liabilities	$	2,374,174						$	2,347,494						$	2,170,868
Shareholders’ equity		299,284							295,506							274,277
Total liabilities and equity	$	2,673,458						$	2,643,000						$	2,445,145
Net interest income and interest rate spread			$	21,630		3.25	%			$	21,101		3.26	%			$	18,713		3.17	%
Net interest margin						3.47	%						3.43	%						3.28	%
Average interest earning assets to average interest bearing liabilities						127.49	%						126.30	%						124.50	%
Interest bearing deposits
Checking accounts	$	593,499	$	687		0.47	%	$	600,249	$	589		0.39	%	$	564,903	$	337		0.24	%
Savings accounts		303,639		27		0.04	%		304,229		27		0.04	%		301,675		30		0.04	%
Customer certificates of deposit		581,858		1,817		1.27	%		530,297		1,458		1.10	%		468,686		1,073		0.92	%
Total customer deposits		1,478,996		2,531		0.68	%		1,434,775		2,074		0.58	%		1,335,264		1,440		0.43	%
Brokered certificates of deposit		165,169		566		1.39	%		164,147		529		1.29	%		99,380		181		0.73	%
Total interest bearing deposits		1,644,165		3,097		0.76	%		1,598,922		2,603		0.65	%		1,434,644		1,621		0.45	%
Noninterest bearing deposits		375,142		—		0.00	%		355,225		—		0.00	%		306,402		—		0.00	%
Total average deposits and cost of deposits	$	2,019,307	$	3,097		0.62	%	$	1,954,147	$	2,603		0.53	%	$	1,741,046	$	1,621		0.37	%
Other interest bearing liabilities
Federal Home Loan Bank advances
Long term advances	$	48,603	$	431		3.60	%	$	48,409	$	404		3.34	%	$	47,823	$	349		2.92	%
Short term advances		265,322		989		1.51	%		301,424		961		1.28	%		347,050		606		0.70	%
Total Federal Home Loan Bank advances		313,925		1,420		1.83	%		349,833		1,365		1.56	%		394,873		955		0.97	%
Repurchase agreements and other		213		—		0.00	%		2,114		1		0.19	%		1,051		8		3.04	%
Total borrowed funds		314,138		1,420		1.83	%		351,947		1,366		1.55	%		395,924		963		0.97	%
Total average deposits and other interest bearing liabilities and total cost of funds	$	2,333,445	$	4,517		0.79	%	$	2,306,094	$	3,969		0.69	%	$	2,136,970	$	2,584		0.48	%
Customer deposits interest bearing and noninterest bearing	$	1,854,138	$	2,531		0.55	%	$	1,790,000	$	2,074		0.46	%	$	1,641,666	$	1,440		0.35	%
Brokered deposits		165,169		566		1.39	%		164,147		529		1.29	%		99,380		181		0.73	%
Total borrowings		314,138		1,420		1.83	%		351,947		1,366		1.55	%		395,924		963		0.97	%
Cost of funds		2,333,445		4,517		0.79	%		2,306,094		3,969		0.69	%		2,136,970		2,584		0.48	%

⁽¹⁾ Nonaccrual loans are included in the average balance at a yield of 0%.     

⁽²⁾ Yields are on a fully taxable equivalent basis.    

UNITED COMMUNITY FINANCIAL CORP.    

SELECTED FINANCIAL HIGHLIGHTS    

(Unaudited)    

	At or for the quarters ended
	March 31, 2018			December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017
	(Dollars in thousands, except per share data)
Financial Data
Total assets	$	2,690,707		$	2,649,905		$	2,602,365		$	2,553,565		$	2,557,010
Total loans, net		2,061,443			1,999,877			1,947,695			1,869,095			1,835,000
Total securities		338,593			353,472			360,371			375,738			430,357
Total deposits		2,066,978			1,956,739			1,938,699			1,893,993			1,905,205
Average interest-bearing deposits		1,644,165			1,598,922			1,563,464			1,579,438			1,434,644
Average noninterest-bearing deposits		375,142			355,225			337,067			333,784			306,402
Total shareholders’ equity		296,195			294,265			291,851			285,480			277,102
Net interest income		21,533			20,880			20,503			20,494			18,476
Net interest income (FTE) (1)		21,630			21,101			20,727			20,723			18,713
Provision for loan losses		407			1,215			721			842			1,475
Noninterest income		5,819			6,460			6,305			7,090			5,384
Noninterest expense		16,600			17,329			15,464			15,176			20,290
Income tax expense		1,789			4,294			3,067			3,377			557
Net income		8,556			4,502			7,556			8,189			1,538
Share Data
Basic earnings per common share	$	0.172		$	0.090		$	0.152		$	0.165		$	0.032
Diluted earnings per common share		0.171			0.090			0.151			0.163			0.032
Book value per common share		5.94			5.90			5.87			5.74			5.58
Tangible book value per common share		5.45			5.41			5.38			5.27			5.10
Market value per common share		9.86			9.13			9.60			8.31			8.34
Common shares outstanding at end of period		49,882			49,800			49,758			49,715			49,695
Weighted average shares outstanding—basic		49,611			49,497			49,460			49,392			48,289
Weighted average shares outstanding—diluted		49,885			49,827			49,851			49,795			48,646
Key Ratios
Return on average assets(2)		1.28	%		0.68	%		1.17	%		1.27	%		0.25	%
Return on average equity(3)		11.44	%		6.09	%		10.43	%		11.60	%		2.24	%
Return on tangible equity(4)		12.44	%		6.62	%		11.35	%		12.66	%		2.39	%
Net interest margin		3.47	%		3.43	%		3.45	%		3.46	%		3.28	%
Efficiency ratio		60.20	%		63.73	%		57.13	%		54.71	%		83.78	%
Nonperforming loans to net loans, end of period		0.59	%		0.59	%		0.62	%		0.58	%		0.58	%
Nonperforming assets to total assets, end of period		0.65	%		0.64	%		0.75	%		0.72	%		0.74	%
Allowance for loan loss as a percent of loans, end of period		1.04	%		1.05	%		1.04	%		1.04	%		1.02	%
Delinquent loans to total net loans, end of period		0.81	%		0.86	%		0.89	%		0.77	%		0.81	%

⁽¹⁾  Net interest income is presented on a fully taxable equivalent (FTE) basis, the Company believes thisnon-GAAP measure is the preferred industry measurement for this item

⁽²⁾  Net income divided by average total assets

⁽³⁾  Net income divided by average total equity

⁽⁴⁾  Net income divided by average total equity, minus average intangible assets

UNITED COMMUNITY FINANCIAL CORP.

SELECTED FINANCIAL HIGHLIGHTS

(Unaudited)

	At or for the quarters ended
	March 31, 2018			December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017
	(Dollars in thousands)
Loan Portfolio Composition
Commercial loans
Multi-family	$	137,836		$	120,480		$	126,977		$	121,565		$	108,330
Owner/nonowner occupied commercial real estate		384,533			381,611			366,747			342,300			325,633
Land		15,452			15,162			13,666			10,867			9,276
Construction		134,181			116,863			108,105			96,765			94,727
Commercial and industrial		201,132			188,500			175,581			170,758			170,398
Total		873,134			822,616			791,076			742,255			708,364
Residential mortgage loans
Real estate		882,873			870,939			851,863			834,349			839,413
Construction		42,453			49,092			57,081			56,946			51,372
Total		925,326			920,031			908,944			891,295			890,785
Consumer loans
Consumer		279,110			273,494			263,692			251,151			251,215
Total		279,110			273,494			263,692			251,151			251,215
Total loans		2,077,570			2,016,141			1,963,712			1,884,701			1,850,364
Less:
Allowance for loan losses		21,610			21,202			20,555			19,660			18,970
Deferred loan costs, net		(5,483	)		(4,938	)		(4,538	)		(4,054	)		(3,606	)
Total		16,127			16,264			16,017			15,606			15,364
Total loans, net		2,061,443			1,999,877			1,947,695			1,869,095			1,835,000
Loans held for sale, net		79,292			83,752			84,545			86,153			75,698
Total loans	$	2,140,735		$	2,083,629		$	2,032,240		$	1,955,248		$	1,910,698
	At or for the quarters ended
	March 31, 2018			December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017
	(Dollars in thousands)
Deposit Portfolio Composition
Checking accounts
Interest bearing checking accounts	$	140,740		$	170,478		$	173,171		$	175,800		$	211,875
Non-interest bearing checking accounts		376,904			354,970			343,146			339,067			333,940
Total checking accounts		517,644			525,448			516,317			514,867			545,815
Savings accounts		308,025			301,716			307,169			310,012			308,533
Money market accounts		483,840			424,234			418,294			427,348			418,449
Totalnon-time deposits		1,309,509			1,251,398			1,241,780			1,252,227			1,272,797
Certificates of deposit less than or equal to $250,000		704,147			651,255			617,839			557,300			547,823
Certificates of deposit greater than $250,000		53,322			54,086			79,080			84,466			84,585
Total certificates of deposit		757,469			705,341			696,919			641,766			632,408
Total deposits	$	2,066,978		$	1,956,739		$	1,938,699		$	1,893,993		$	1,905,205

UNITED COMMUNITY FINANCIAL CORP.    

SELECTED FINANCIAL HIGHLIGHTS    

(Unaudited)    

	At or for the quarters ended
	March 31, 2018			December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017
	(Dollars in thousands)
Allowance For Loan Losses
Beginning balance	$	21,202		$	20,555		$	19,660		$	18,970		$	19,087
Provision		407			1,215			721			842			1,475
Net recoveries (chargeoffs)		1			(568	)		174			(152	)		(1,592	)
Ending balance	$	21,610		$	21,202		$	20,555		$	19,660		$	18,970
	At or for the quarters ended
	March 31, 2018			December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017
	(Dollars in thousands)
Net Recoveries (Charge-offs)
Commercial loans
Multi-family	$	6		$	(126	)	$	(4	)	$	4		$	1
Owner/nonowner occupied commercial real estate		40			23			39			24			(1,141	)
Land		—			—			—			—			(25	)
Construction		7			—			—			—			—
Commercial and industrial		104			(90	)		314			108			1
Total		157			(193	)		349			136			(1,164	)
Residential mortgage loans
Real estate		(66	)		(257	)		(291	)		(239	)		(196	)
Construction		—			—			—			—			—
Total		(66	)		(257	)		(291	)		(239	)		(196	)
Consumer loans
Consumer		(90	)		(118	)		116			(49	)		(232	)
Total		(90	)		(118	)		116			(49	)		(232	)
Total net chargeoffs	$	1		$	(568	)	$	174		$	(152	)	$	(1,592	)
	At or for the quarters ended
	March 31, 2018			December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017
	(Dollars in thousands)
Nonperforming Loans
Commercial loans
Multi-family	$	275		$	275		$	402		$	413		$	419
Owner/nonowner occupied commercial real estate		1,206			1,218			1,234			1,331			1,398
Land		9			9			9			9			9
Construction		—			—			—			—			—
Commercial and industrial		1,459			1,505			234			190			354
Total		2,949			3,007			1,879			1,943			2,180
Residential mortgage loans
Real estate		7,045			6,076			6,627			6,701			5,868
Construction		—			—			—			—			—
Total		7,045			6,076			6,627			6,701			5,868
Consumer loans
Consumer		2,180			2,620			2,332			2,137			2,513
Total		2,180			2,620			2,332			2,137			2,513
Total nonperforming loans	$	12,174		$	11,703		$	10,838		$	10,781		$	10,561
Total Nonperforming Loans and Nonperforming Assets
Past due 90 days and on nonaccrual status	$	8,326		$	8,620		$	7,634		$	7,706		$	7,581
Past due 90 days and still accruing		—			—			8			2			—
Past due 90 days		8,326			8,620			7,642			7,708			7,581
Past due less than 90 days and on nonaccrual		3,848			3,083			3,196			3,073			2,980
Total nonperforming loans		12,174			11,703			10,838			10,781			10,561
Other real estate owned		1,030			1,047			1,133			1,197			1,137
Other classified assets		4,050			4,050			6,384			6,384			6,384
Repossessed assets		263			206			10			—			—
Total nonperforming assets	$	17,517		$	17,006		$	18,365		$	18,362		$	18,082

UNITED COMMUNITY FINANCIAL CORP.

NON-GAAP DISCLOSURE RECONCILIATION

(Unaudited)

Reconciliation of Average Shareholders’ Equity to Average Tangible Equity:    

	At or for the quarters ended
	March 31, 2018			December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017
	(Dollars in thousands, except per share data)
Average shareholders equity	$	299,284		$	295,506		$	295,506		$	282,335		$	274,277
Average intangible assets		24,175			23,563			23,642			23,699			26,935
Average tangible equity	$	275,109		$	271,943		$	271,864		$	258,636		$	247,342
Net income	$	8,556		$	4,502		$	7,556		$	8,189		$	1,538
Return on tangible equity		12.44	%		6.62	%		11.12	%		12.66	%		2.49	%

Reconciliation of Fully Taxable Equivalent Net Interest Income to Net Interest Income:    

	For the quarters ended
	March 31, 2018		December 31, 2017		September 30, 2017		June 30, 2017		March 31, 2017
	(Dollars in thousands)
Interest income	$	26,050	$	24,849	$	24,048	$	23,553	$	21,060
Fully taxable equivalent adjustment		97		221		224		229		237
Fully taxable equivalent interest income		26,147		25,070		24,272		23,782		21,297
Interest expense		4,517		3,969		3,545		3,059		2,584
Fully taxable net interest income	$	21,630	$	21,101	$	20,727	$	20,723	$	18,713

Reconciliation of Coverage Ratio to Coverage Ratio with Fair Value Adjustments Included with Allowance for Loan Losses:

	March 31, 2018
	(Dollars in thousands)
Allowance for loan losses	$	21,610
Fair value adjustments		3,340
		24,950
Loans, net	$	2,061,443
Add: Allowance for loan losses and fair value adjustment		24,950
Gross loans	$	2,086,393
Coverage ratio with the Fair Value adjustments included in Allowance for loan losses		1.20	%

Tangible Book Value Per Share:

Tangible book value, per share is defined at shareholders equity minus intangible assets divided by the number of shares outstanding.

	At the quarters ended
	March 31, 2018		December 31, 2017		September 30, 2017		June 30, 2017		March 31, 2017
	(Dollars in thousands, except per share data)
Total shareholders’ equity	$	296,195	$	294,265	$	291,851	$	285,480	$	277,102
Goodwill		20,221		20,221		19,488		19,467		19,460
Customer list intangible		2,030		2,060		2,090		2,060		2,090
Core deposit intangible		1,851		1,934		2,017		2,099		2,182
Total common shares outstanding		49,882,491		49,800,126		49,758,487		49,715,021		49,695,487
Tangible book value, as reported	$	5.45	$	5.42	$	5.39	$	5.27	$	5.10