FIRST NILES FINANCIAL, INC.
                       ANNOUNCES STOCK REPURCHASE PROGRAM



Niles, Ohio, May 21, 1999 - First Niles Financial, Inc. (Nasdaq SmallCap Market:
FNFI),  the holding  company for Home Federal  Savings and Loan  Association  of
Niles,  announced its intention  today to repurchase up to 87,720 common shares,
representing  5% of its outstanding  shares,  in the open market or in privately
negotiated  transactions.  These shares will be purchased at  prevailing  market
prices over a twelve-month period depending upon market conditions.

William L.  Stephens,  Chairman  of the  Board,  President  and Chief  Executive
Officer of First  Niles,  indicated  that the Board of  Directors  approved  the
repurchase  program in view of the current market price of the Company's  common
stock, especially in relation to its book value, and the strong capital position
of the Company's subsidiary, Home Federal Savings and Loan Association of Niles.
The Company's book value was $17.00 at March 31, 1999. Mr.  Stephens stated that
"We  believe  that  the  repurchase  of  our  shares  represents  an  attractive
investment opportunity which will benefit the Company and our stockholders."

As of March 31, 1999, First Niles had consolidated total assets of $85.7 million
and stockholders'  equity of $29.8 million. The Company's stock is traded on the
Nasdaq SmallCap Market under the symbol "FNFI".

FOR IMMEDIATE RELEASE                  For Further Information Contact:

May 21, 1999                           Lawrence Safarek, Vice President
                                       First Niles Financial, Inc.
                                       55 N. Main Street
                                       Niles, Ohio  44446
                                       (330) 652-2539