EXHIBIT 99.1
FOR IMMEDIATE RELEASE: CONTACT: Robert K. Chapman
February 23, 2007 United Bancorp, Inc.
734-214-3801
UNITED BANCORP, INC.
ANNOUNCES REVISION OF FOURTH QUARTER
AND FULL YEAR 2006 EARNINGS
TECUMSEH, MI -- United Bancorp, Inc. (OTCBB: UBMI) today issued an adjustment to
its fourth quarter and full year 2006 earnings release dated January 16, 2007.
The adjustment relates to the Company's recognition of the potential impairment
of a large loan and the Company's corresponding increase in the amount of its
Allowance for Loan Losses (ALL) at December 31, 2006 to take into account the
potential impairment of the loan.
During the ongoing finalization of its financial statements and preparation of
its 10-K for the year ended December 31, 2006 and subsequent to the January 16,
2007 press release, the Company determined that the level of impairment of loans
to one commercial loan customer was understated in its analysis at the end of
the calendar year. As a consequence, Management determined that an additional
provision of $450,000 to the Company's ALL in the fourth quarter of 2006 was
warranted.
This change affects the Company's unaudited financial statements for the three
month and one year periods ended December 31, 2006. Net income for the fourth
quarter and year ended December 31, 2006 was reduced by $268,124, or a $.10
decrease to the previously-reported basic and diluted earnings per share. As a
result of this adjustment, the Company's revised net income was $2,197,106 for
the fourth quarter of 2006 and $8,971,526 for the year ended December 31, 2006.
For the fourth quarter 2006, basic and diluted earnings per share were $.83,
while for the full year 2006, basic and diluted earnings per share were $3.38.
These changes will be reflected in United Bancorp, Inc.'s 10-K for the year
ended December 31, 2006, which will be filed on or before March 16, 2007. We
have set forth below the Company's consolidated financial highlights -
unaudited, consolidated balance sheets (unaudited), and consolidated statements
of income (unaudited) for the fourth quarter and full year 2006. This data
replaces the consolidated financial highlights - unaudited, consolidated balance
sheets, and consolidated statements of income (unaudited), contained in United
Bancorp, Inc.'s previous earnings release of January 16, 2007.
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 news release may contain certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21
B of the Securities Act of 1934, as amended, which are intended to be safe
harbors created thereby. Those statements are based on management's beliefs,
assumptions, current expectations, estimates and projections about the financial
services industry, the economy, and about the Company itself. Words such as
"anticipate," "believe," "determine," "estimate," "expect," "forecast,"
"intend," "is likely," "plan," "project," "opinion," variations of such terms,
and similar expressions are intended to identify such forward-looking
statements. The presentations and discussions of the provision and allowance for
loan losses presented in this report are inherently forward-looking statements
in that they involve judgments and statements of belief as to the outcome of
future events.
These statements are not guarantees of future performance and involve certain
risks, uncertainties, and assumptions that are difficult to predict with regard
to timing, extent, likelihood, and degree of occurrence. These risks,
uncertainties and assumptions are included in the Company's filings with the
SEC, including Item 1A of its Form 10K. Actual results and outcomes may
materially differ from what may be expressed or forecasted in such
forward-looking statements. Internal and external factors that may cause such a
difference include changes in economic conditions in the market area the Company
conducts business which could materially impact credit quality trends, interest
rates and interest rate relationships; demand for products and services; the
degree of competition by traditional and non-traditional competitors; changes in
banking laws and regulations; changes in tax laws; changes in prices, levies,
and assessments; the impact of technological advances; governmental and
regulatory policy changes; the outcomes of pending and future litigation and
contingencies; trends in customer behavior and customer ability to repay loans;
software failure, errors or miscalculations; and the vicissitudes of the
national economy. The Company wishes to caution readers not to place undue
reliance on any such forward-looking statements, which speak only as of the date
made. The Company undertakes no obligation to update, amend or clarify
forward-looking statements, whether as a result of new information, future
events, or otherwise.
###
UNITED BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
in thousands of dollars except per share data
<Table>
<Caption>
December 31, December 31,
2006 2005
------------ ------------
ASSETS
Cash and demand balances in other banks ....................... $ 17,606 $ 20,416
Federal funds sold ............................................ 3,770 --
--------- ---------
Total cash and cash equivalents ............................... 21,376 20,416
Securities available for sale ................................. 95,811 103,432
Loans held for sale ........................................... 5,772 1,060
Portfolio loans ............................................... 595,991 557,052
--------- ---------
Total loans ................................................... 601,763 558,112
Less allowance for loan losses ............................ 7,849 6,361
--------- ---------
Net loans ..................................................... 593,914 551,751
Premises and equipment, net ................................... 13,215 12,998
Goodwill ...................................................... 3,469 3,469
Bank owned life insurance ..................................... 11,499 11,091
Accrued interest receivable and other assets .................. 11,705 10,621
--------- ---------
TOTAL ASSETS .................................................. $ 750,989 $ 713,779
========= =========
LIABILITIES
Total deposits ................................................ 628,002 590,652
Short term borrowings ......................................... 77 6,376
FHLB Advances outstanding ..................................... 40,945 42,228
Accrued interest payable and other liabilities ................ 7,429 6,901
--------- ---------
TOTAL LIABILITIES ............................................. 676,453 646,157
--------- ---------
SHAREHOLDERS' EQUITY
Common stock and paid in capital, no par value;
5,000,000 shares authorized; 2,623,716 and 2,493,238
shares issued and outstanding, respectively ................... 71,075 63,186
Retained earnings ............................................. 3,393 4,705
Accumulated other comprehensive income (loss), net of tax ..... 68 (269)
--------- ---------
TOTAL SHAREHOLDERS' EQUITY .................................... 74,536 67,622
--------- ---------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY .................... $ 750,989 $ 713,779
========= =========
Book value per share of common stock .......................... $ 28.41 $ 25.83
(Per share values restated to reflect 2006 stock dividend)
</Table>
UNITED BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
DECEMBER 31, 2006
<Table>
<Caption>
Quarter to Date Year to Date
------------------------------ ------------------------------
December 31, December 31, December 31, December 31,
INTEREST INCOME 2006 2005 2006 2005
------------ ------------ ------------ ------------
Interest and fees on loans
Taxable $ 11,248,028 $ 9,588,571 $ 42,771,348 $ 35,085,253
Tax exempt 31,084 34,802 129,101 139,634
Interest on securities
Taxable 646,062 507,959 2,392,039 2,032,414
Tax exempt 380,434 358,759 1,404,596 1,198,681
Interest on federal funds sold 67,903 77,102 358,649 193,025
------------ ------------ ------------ ------------
Total interest income 12,373,511 10,567,193 47,055,733 38,649,007
INTEREST EXPENSE
Interest on certificates of
deposit of $100,000 or more 1,208,060 631,657 4,186,583 2,029,600
Interest on other deposits 3,248,254 2,446,063 11,703,706 8,255,076
Interest on short term borrowings 14,130 15,087 61,570 73,912
Interest on other borrowings 479,634 490,496 1,850,288 1,927,351
------------ ------------ ------------ ------------
Total interest expense 4,950,078 3,583,303 17,802,147 12,285,939
------------ ------------ ------------ ------------
NET INTEREST INCOME 7,423,433 6,983,890 29,253,586 26,363,068
Provision for loan losses 921,327 377,700 2,122,999 1,331,594
------------ ------------ ------------ ------------
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 6,502,106 6,606,190 27,130,587 25,031,474
------------ ------------ ------------ ------------
NONINTEREST INCOME
Service charges on deposit accounts 881,704 807,158 3,364,364 3,017,445
Trust & Investment fee income 947,790 945,754 3,769,233 3,873,625
Gains (losses) on securities transactions 13,807 -- 12,073 (443)
Loan sales and servicing 276,484 309,732 905,716 1,214,859
ATM, debit and credit card fee income 495,956 435,011 1,905,160 1,676,563
Sales of nondeposit investment products 206,303 180,743 992,702 797,503
Income from bank-owned life insurance 105,595 100,695 407,692 397,600
Other income 182,843 181,602 817,931 691,282
------------ ------------ ------------ ------------
Total noninterest income 3,110,482 2,960,695 12,174,871 11,668,434
NONINTEREST EXPENSE
Salaries and employee benefits 3,540,571 3,570,172 15,037,698 14,662,572
Occupancy and equipment expense 1,064,327 930,993 4,344,320 4,073,641
External data processing 475,556 359,469 1,536,559 1,283,314
Advertising and marketing 243,313 302,586 1,062,663 1,105,953
Other expense 1,274,132 1,196,699 4,932,764 4,070,039
------------ ------------ ------------ ------------
Total noninterest expense 6,597,899 6,359,919 26,914,004 25,195,519
------------ ------------ ------------ ------------
INCOME BEFORE FEDERAL INCOME TAX 3,014,689 3,206,966 12,391,454 11,504,389
Federal income tax 817,583 888,316 3,419,928 3,180,653
------------ ------------ ------------ ------------
NET INCOME $ 2,197,106 $ 2,318,650 $ 8,971,526 $ 8,323,736
============ ============ ============ ============
Basic earnings per share $ 0.83 $ 0.88 $ 3.38 $ 3.15
Diluted earnings per share $ 0.83 $ 0.88 $ 3.38 $ 3.13
(Earnings per share restated to reflect
2006 stock dividend)
Return on average assets (annualized) 1.18% 1.30% 1.23% 1.21%
Return on average equity (annualized) 11.85% 13.77% 12.62% 12.75%
</Table>