United Bancorp 8-K 2008 Financial Results and Declares Cash Dividend

Exhibit 99.1

FOR IMMEDIATE RELEASE:	CONTACT:	Robert K. Chapman
January 30, 2009		United Bancorp, Inc.
		734-214-3801

UNITED BANCORP, INC. ANNOUNCES

2008 FINANCIAL RESULTS AND DECLARES CASH DIVIDEND

TECUMSEH, MI – United Bancorp, Inc. (UBMI), reported income of $1.173 million or $.23 per share for the year ended December 31, 2008, compared to $5.582 million or $1.06 per share for 2007. The Company’s decline in net income reflects the continued economic weakness within its market and an increase in losses resulting from nonperforming loans. The Company’s provision for loan losses for the fourth quarter of $7.2 million brings the provision for all of 2008 to $12.8 million. In addition, the Company recognized a $516,000 impairment on loan servicing rights during the quarter. The net loss for the quarter was $2.807 million, or $0.55 per share.

Robert K. Chapman, President and Chief Executive Officer of the Company, commented that this past year has been extremely difficult, as banks have dealt with the results of the most dramatic events in the U.S. financial markets since the 1930’s. The Michigan economy is especially stressed, with unemployment at the highest level of any state in the U.S. These challenging economic times have also resulted in significantly declining collateral values in United’s market areas, and corresponding increases in related credit issues and costs.

While current economic conditions continue to present significant challenges, United is committed to maintaining the strength of the Company by taking steps to protect its capital for the long-term benefit of its shareholders. This month, United issued $20.6 million in preferred stock to the United States Department of Treasury under the TARP Capital Purchase Program (“CPP”). United’s capital ratios prior to receiving CPP funds exceeded the designation of “well capitalized” under regulatory capital requirements, and the addition of the CPP investment will help United to continue to meet the lending needs of its market areas.

In other efforts to preserve capital, the Board of Directors of the Company has declared a quarterly dividend of $.02 per share payable February 20, 2009 to shareholders of record February 9. This reflects a decrease from $.10 per share paid in the fourth quarter of 2008. The Board believes that it is in the Company’s best interest to preserve capital given the severe financial market conditions in Michigan and the U.S. In addition, the Company has instituted cost containment and reduction measures intended to protect the Company’s capital levels in the face of its uncertain future level of earnings.

While all of these challenges have had a negative impact on financial results of the Company, United is taking steps intended to position the Company to emerge from these economic challenges, poised to grow profitably over the long term. Total consolidated assets of the Company reached $833.6 million at December 31, 2008, for growth of $37.9 million for the year. During the past year, gross portfolio loan balances increased by $52.5 million, while deposits grew by $38.0 million. The fourth quarter was particularly strong, as loan balances grew by $14.0 million and deposits increased by $23.0 million.

Chapman noted that this strong growth is due in part to the success of United’s current “BANK LOCALLY” campaign, which is important in allowing the Company to meet the needs of its communities. “When depositors choose to deposit their money in local community banks like ours, it is re-invested locally for all of us to prosper,” stated Chapman. In addition, United continues to take advantage of growth opportunities that are presented as certain larger competitors reduce their lending activities in Michigan markets.

About United Bancorp, Inc.

United Bancorp, Inc. is an independent financial holding company that is the parent company for United Bank & Trust and United Bank & Trust – Washtenaw. The subsidiary banks operate seventeen banking offices in Lenawee, Washtenaw and Monroe counties, and United Bank & Trust maintains an active wealth management group that serves the Company’s market area. For more information, visit the company’s website at www.ubat.com.

Unaudited Consolidated Financial Statements Follow.

Safe Harbor Statement

This press release contains forward-looking statements that are based on management's beliefs, assumptions, current expectations, estimates and projections about the financial services industry, the economy, and United Bancorp, Inc. Forward-looking statements are identifiable by words or phrases such as that an event or trend “will” or “would” occur or “continue” or that United Bancorp, Inc. or its management “believes”, “expects”, “intends” or is “committed” that a particular result or event will occur or desires to “pursue” a particular opportunity, or other words such as “opportunities”, “poised” and variations of such words and similar expressions. The provision and allowances for loan losses and the value of servicing rights are estimates which are inherently forward looking statements. United’s ability to enhance its balance sheet, preserve and protect capital, expand loans, add new customers, execute its cost containment and growth strategy and identify and successfully realize strategic acquisition opportunities is also not assured and also depends on factors not entirely within United’s control. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions (“risk factors”) that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what may be expressed or forecasted in such forward-looking statements. United Bancorp, Inc. undertakes no obligation to update, amend or clarify forward-looking statements, whether as a result of new information, future events or otherwise.

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United Bancorp, Inc. and Subsidiaries
Comparative Consolidated Balance Sheet Data (Unaudited)
Dollars in thousands except per share data
				Dec. 31			Sep. 30			Percent			Dec. 31		Percent
Period-end Balance Sheet				2008			2008			Change			2007		Change
Assets
Cash and due from banks				$	18,472		$	16,856			9.6	%	$	17,996		2.6	%
Federal funds sold					-			-			100.0	%		11,130		-100.0	%
Total cash and cash equivalents					18,472			16,856			9.6	%		29,126		-36.6	%
Securities available for sale					85,093			78,013			9.1	%		85,898		-0.9	%
Loans held for sale					4,988			7,107			-29.8	%		5,770		-13.6	%
Portfolio loans
Personal					112,095			110,136			1.8	%		98,659		13.6	%
Business					482,564			475,648			1.5	%		451,717		6.8	%
Residential mortgage					102,360			97,280			5.2	%		94,154		8.7	%
Total loans					697,019			683,064			2.0	%		644,530		8.1	%
Allowance for loan losses					16,480			14,335			15.0	%		12,306		33.9	%
Net loans					680,539			668,729			1.8	%		632,224		7.6	%
Premises and equipment, net					13,205			12,621			4.6	%		13,160		0.3	%
Goodwill					3,469			3,469			0.0	%		3,469		0.0	%
Bank owned life insurance					12,447			12,319			1.0	%		11,961		4.1	%
Other assets					15,389			16,233			-5.2	%		14,079		9.3	%
Total Assets				$	833,602		$	815,347			2.2	%	$	795,687		4.8	%
Liabilities
Deposits
Non-interest bearing				$	89,487		$	88,212			1.4	%	$	77,878		14.9	%
Interest bearing					620,062			598,341			3.6	%		593,659		4.4	%
Total deposits					709,549			686,553			3.3	%		671,537		5.7	%
Fed funds borrowed					-			-			0.0	%		-		0.0	%
FHLB advances outstanding					50,036			51,951			-3.7	%		44,611		12.2	%
Other liabilities					3,357			4,077			-17.7	%		6,572		-48.9	%
Total Liabilities					762,942			742,581			2.7	%		722,720		5.6	%
Shareholders' Equity					70,660			72,766			-2.9	%		72,967		-3.2	%
Total Liabilities and Shareholders' Equity				$	833,602		$	815,347			2.2	%	$	795,687		4.8	%
	Fourth Quarter									Year to Date
Average Balance Data	2008			2007			% Change			2008			2007		% Change
Total loans	$	697,865		$	650,606			7.3	%	$	672,885		$	633,855		6.2	%
Earning assets		793,937			758,261			4.7	%		773,545			741,133		4.4	%
Total assets		836,741			797,472			4.9	%		809,300			777,243		4.1	%
Deposits		706,757			665,498			6.2	%		676,845			647,342		4.6	%
Shareholders' Equity		72,343			75,029			-3.6	%		73,585			75,042		-1.9	%
Asset Quality
Net charge offs	$	5,020		$	1,211			314.5	%	$	8,601		$	4,182		105.7	%
Non-accrual loans		20,019			13,695			46.2	%
Non-performing loans		21,522			15,150			42.1	%
Non-performing assets		24,982			17,415			43.4	%
Nonperforming loans/total loans		3.09	%		2.35	%		31.4	%
Allowance for loan loss/total loans		2.36	%		1.91	%		23.8	%
Allowance/nonperforming loans		76.6	%		81.2	%		-5.7	%

United Bancorp, Inc. and Subsidiaries
Comparative Consolidated Income Statement and Performance Data (Unaudited)
Dollars in thousands except per share data
	Three months ended Dec. 31									Twelve months ended Dec. 31
Consolidated Income Statement	2008			2007			% Change			2008			2007			% Change
Interest Income
Interest and fees on loans	$	10,643		$	11,982			-11.2	%	$	43,288		$	47,301			-8.5	%
Interest on investment securities		870			980			-11.2	%		3,625			4,062			-10.8	%
Interest on federal funds sold		3			116			-97.4	%		128			271			-52.8	%
Total interest income		11,516			13,078			-11.9	%		47,041			51,634			-8.9	%
Interest Expense
Interest on deposits		3,597			5,117			-29.7	%		14,964			19,631			-23.8	%
Interest on federal funds purchased		1			15			-93.3	%		96			175			-45.1	%
Interest on FHLB advances		576			535			7.7	%		2,237			2,067			8.2	%
Total interest expense		4,174			5,667			-26.3	%		17,297			21,873			-20.9	%
Net Interest Income		7,342			7,411			-0.9	%		29,744			29,761			-0.1	%
Provision for loan losses		7,165			5,801			23.5	%		12,775			8,637			47.9	%
Net Interest Income After
Provision for Loan Losses		177			1,610			-89.0	%		16,969			21,124			-19.7	%
Noninterest Income
Service charges on deposit accounts		781			957			-18.4	%		3,381			3,579			-5.5	%
Trust & Investment fee income		956			1,231			-22.3	%		4,343			4,801			-9.5	%
Gains on securities transactions		(124	)		8			-1650.0	%		(18	)		9			-300.0	%
Income from loan sales and servicing		47			507			-90.7	%		2,187			1,749			25.0	%
ATM, debit and credit card fee income		558			569			-1.9	%		2,257			2,118			6.6	%
Income from bank-owned life insurance		127			120			5.8	%		486			461			5.4	%
Other income		193			175			10.3	%		874			935			-6.5	%
Total noninterest income		2,538			3,567			-28.8	%		13,510			13,652			-1.0	%
Noninterest Expense
Salaries and employee benefits		3,901			3,532			10.4	%		16,333			14,862			9.9	%
Occupancy and equipment expense		1,158			1,079			7.3	%		4,874			4,724			3.2	%
External data processing		444			452			-1.8	%		1,755			1,605			9.3	%
Advertising and marketing		219			251			-12.7	%		1,191			1,193			-0.2	%
Other expense		1,569			1,299			20.8	%		5,810			5,175			12.3	%
		7,291			6,613			10.3	%		29,963			27,559			8.7	%
Income (Loss) Before Federal Income Tax		(4,576	)		(1,436	)		218.7	%		516			7,217			-92.9	%
Federal income tax		(1,769	)		(686	)		157.9	%		(657	)		1,635			-140.2	%
Net Income (Loss)	$	(2,807	)	$	(750	)		274.3	%	$	1,173		$	5,582			-79.0	%
Performance Ratios
Return on average assets		-1.33	%		-0.37	%		260.6	%		0.14	%		0.72	%		-79.9	%
Return on average equity		-15.43	%		-3.97	%		288.7	%		1.59	%		7.44	%		-78.6	%
Net interest margin (FTE)		3.87	%		4.06	%		-4.7	%		4.04	%		4.18	%		-3.4	%
Efficiency ratio		72.0	%		59.0	%		22.0	%		67.7	%		62.1	%		9.0	%
Stock Performance
Basic and diluted earnings per share	$	(0.55	)	$	(0.15	)		278.3	%	$	0.23		$	1.06			-78.3	%
Dividends per share		0.10			0.20			-50.0	%		0.70			0.79			-11.4	%
Dividend payout ratio		-18.2	%		-137.9	%		-86.8	%		304.9	%		74.5	%		309.1	%
Book value per share	$	13.98		$	14.33			-2.4	%
Market value per share		7.55			17.00			-55.6	%
Period-end shares outstanding		5,053			5,092			-0.8	%
Average shares outstanding		5,053			5,108			-1.1	%		5,062			5,191			-2.5	%
Per-share data is restated to reflect 100% stock dividend in 2007

Trends of Selected Consolidated Financial Data (Unaudited)
Dollars in thousands except per share data
	2008												2007
Balance Sheet Data	4th Qtr			3rd Qtr			2nd Qtr			1st Qtr			4th Qtr
Period-end:
Total loans	$	697,019		$	683,064		$	662,014		$	654,965		$	644,530
Allowance for loan losses		16,480			14,335			13,008			12,047			12,306
Earning assets		787,100			768,184			752,517			751,774			747,328
Total assets		833,602			815,347			798,922			797,874			795,687
Deposits		709,549			686,553			669,054			667,522			671,537
Shareholders' Equity		70,660			72,766			73,452			74,093			72,967
Average:
Total loans	$	697,865		$	673,548		$	664,895		$	654,940		$	650,606
Earning assets		793,937			765,119			765,808			768,288			758,261
Total assets		836,741			801,175			797,715			801,301			797,472
Deposits		706,757			668,354			655,132			677,023			665,498
Shareholders' Equity		72,343			72,890			72,890			72,757			75,029
Income Statement Summary
Net interest income	$	7,342		$	7,538		$	7,387		$	7,478		$	7,411
Provision for loan losses		7,165			3,300			1,650			660			5,801
Non-interest income		2,538			3,667			3,766			3,538			3,567
Non-interest expense		7,291			7,623			7,248			7,802			6,613
Federal income tax		(1,769	)		(114	)		560			665			(686	)
Net income (loss)	$	(2,807	)	$	396		$	1,695		$	1,888		$	(750	)
Basic & diluted earnings (loss) per share	$	(0.55	)	$	0.08		$	0.33		$	0.37		$	(0.15	)
Performance Ratios and Liquidity
Return on average assets		-1.33	%		0.20	%		0.86	%		0.94	%		-0.37	%
Return on average equity		-15.43	%		2.14	%		9.29	%		10.35	%		-3.97	%
Net interest margin (FTE)		3.87	%		4.16	%		4.07	%		4.10	%		4.06	%
Efficiency ratio		72.0	%		66.5	%		63.6	%		69.3	%		59.0	%
Ratio of loans to deposits		98.2	%		99.5	%		98.9	%		98.1	%		96.0	%
Asset Quality
Net charge offs	$	5,020		$	1,973		$	689		$	919		$	1,211
Non-accrual loans		20,019			13,986			15,716			13,253			13,695
Non-performing loans		21,522			16,717			17,528			16,235			15,150
Non-performing assets		24,982			20,270			20,263			18,626			17,415
Nonperforming loans/total loans		3.09	%		2.45	%		2.65	%		2.48	%		2.35	%
Allowance for loan loss/total loans		2.36	%		2.10	%		1.96	%		1.84	%		1.91	%
Allowance/nonperforming loans		76.6	%		85.8	%		74.2	%		74.2	%		81.2	%
Market Data
Book value per share	$	13.98		$	14.40		$	14.54		$	14.56		$	14.33
Market value per share
High		12.99			14.98			20.00			22.00			22.00
Low		7.55			9.20			14.00			17.55			17.00
Period-end		7.55			10.00			15.00			18.00			17.00
Period-end shares outstanding		5,053			5,052			5,052			5,085			5,092
Average shares outstanding		5,053			5,053			5,110			5,145			5,108
Capital and Stock Performance
Tier 1 Leverage Ratio		8.0	%		8.7	%		8.8	%		8.8	%		8.7	%
Total capital to risk-weighted assets		10.9	%		11.4	%		11.6	%		11.7	%		11.8	%
Dividends per share	$	0.10		$	0.20		$	0.20		$	0.20		$	0.20
Dividend payout ratio		-18.2	%		256.4	%		60.6	%		53.9	%		-137.9	%
Price/earnings ratio (TTM)		32.8	x		15.8	x		14.9	x		16.3	x		16.1	x
Period-end market price/book value		54.0	%		69.4	%		103.2	%		123.6	%		118.6	%