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SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
(AMENDMENT NO. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement [ ] CONFIDENTIAL, FOR USE OF THE COMMISSION
ONLY (AS PERMITTED BY RULE 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12.

POTTERS FINANCIAL CORPORATION
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)

Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

(1) Title of each class of securities to which transaction applies: .......

(2) Aggregate number of securities to which transaction applies: ..........

(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined): ............

(4) Proposed maximum aggregate value of transaction: ......................

(5) Total fee paid: .......................................................

[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid: ...............................................

(2) Form, Schedule or Registration Statement No.: .........................

(3) Filing Party: .........................................................

(4) Date Filed: ...........................................................

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2
POTTERS FINANCIAL CORPORATION
519 BROADWAY
EAST LIVERPOOL, OHIO 43920
(330) 385-0770

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

Notice is hereby given that the 2001 Annual Meeting of the Shareholders
of Potters Financial Corporation ("PFC") will be held at Kent State University,
East Liverpool Campus, Mary Patterson Building, The Brown Community Room, Room
202, 213 East Fourth Street, East Liverpool, Ohio, on April 26, 2001, at 10:00
a.m. (the "Annual Meeting"), for the following purposes, all of which are more
completely set forth in the accompanying Proxy Statement:

1. To re-elect four directors of PFC for terms expiring in 2003;

2. To ratify the selection of Crowe, Chizek and Company LLP as the
auditors of PFC for the current fiscal year; and

3. To transact such other business as may properly come before the Annual
Meeting or any adjournments thereof.

Only shareholders of PFC of record at the close of business on March 9,
2001, will be entitled to receive notice of and to vote at the Annual Meeting
and at any adjournments thereof. Whether or not you expect to attend the Annual
Meeting, we urge you to consider the accompanying Proxy Statement carefully and
to SIGN, DATE AND PROMPTLY RETURN THE ENCLOSED PROXY SO THAT YOUR SHARES MAY BE
VOTED IN ACCORDANCE WITH YOUR WISHES AND THE PRESENCE OF A QUORUM MAY BE ASSURED
AT THE ANNUAL MEETING. The giving of a Proxy does not affect your right to vote
in person in the event you attend the Annual Meeting.

By Order of the Board of Directors

East Liverpool, Ohio Anne S. Myers, Secretary
March 23, 2001

3
POTTERS FINANCIAL CORPORATION
519 BROADWAY
EAST LIVERPOOL, OHIO 43920
(330) 385-0770

PROXY STATEMENT

PROXIES

The enclosed proxy (the "Proxy") is being solicited by the Board of
Directors of Potters Financial Corporation, an Ohio corporation ("PFC"), for use
at the 2001 Annual Meeting of Shareholders of PFC to be held at Kent State
University, East Liverpool Campus, Mary Patterson Building, The Brown Community
Room, Room 202, 213 East Fourth Street, East Liverpool, Ohio, on April 26, 2001,
at 10:00 a.m. (the "Annual Meeting"). Without affecting any vote previously
taken, the Proxy may be revoked by a shareholder through the execution of a
later dated proxy which is received by PFC before the Proxy is exercised or by
giving notice of revocation to PFC in writing or in open meeting before the
Proxy is exercised. Any such later dated Proxy or written notice of revocation
must be delivered to Potters Financial Corporation, 519 Broadway, East
Liverpool, Ohio 43920, Attention: Anne S. Myers, Secretary. Attendance at the
Annual Meeting will not, of itself, revoke a Proxy.

Each properly executed Proxy received prior to the Annual Meeting and
not revoked will be voted as specified thereon or, in the absence of specific
instructions to the contrary, will be voted:

FOR the election of William L. Miller, Edward L. Baumgardner, Suzanne
B. Fitzgerald and James R. Platte as directors of PFC for terms
expiring in 2003; and

FOR the ratification of the selection of Crowe, Chizek and Company LLP
("Crowe Chizek") as the auditors of PFC for the current fiscal year.

The cost of soliciting Proxies will be assumed by PFC. Proxies may be
solicited by the directors, officers and other employees of PFC and Potters
Bank, the wholly owned subsidiary of PFC, in person or by telephone, telecopy,
telegraph or mail only for use at the Annual Meeting. Proxies solicited in
connection with the Annual Meeting will not be used for any other meeting.

Only shareholders of record as of the close of business on March 9,
2001 (the "Voting Record Date"), are entitled to vote at the Annual Meeting and
will be entitled to cast one vote for each common share owned. PFC's records
disclose that, as of the Voting Record Date, there were 997,989 common shares of
PFC outstanding and entitled to be cast at the Annual Meeting.

This Proxy Statement is first being mailed to shareholders of PFC on or
about March 23, 2001.

4
VOTE REQUIRED

ELECTION OF DIRECTORS

Under Ohio law and PFC's Code of Regulations (the "Regulations"), the
four nominees receiving the greatest number of votes will be elected as
directors. Shareholders may not cumulate votes in the election of directors.
Each shareholder will be entitled to cast one vote for each share owned. Shares
as to which the authority to vote is withheld and shares held by a nominee for a
beneficial owner that are represented in person or by proxy at the Annual
Meeting, but not voted with respect to the election of directors ("Non-votes"),
are not counted toward the election of directors or toward the election of the
individual nominees specified in the enclosed Proxy. If the enclosed Proxy is
signed and dated by the shareholder, but no vote is specified thereon, the
shares held by such shareholder will be voted FOR the reelection of the four
nominees.

RATIFICATION OF SELECTION OF AUDITORS

The affirmative vote of the holders of a majority of the shares of PFC
represented in person or by proxy at the Annual Meeting is necessary to ratify
the selection of Crowe Chizek as the auditors of PFC for the current fiscal
year. The effect of an abstention or Non-vote is the same as a vote against the
approval of such ratification. If, however, a shareholder has signed and dated a
proxy in the form of the enclosed Proxy, but no vote is specified thereon, the
shares held by such shareholder will be voted FOR the ratification of the
selection of Crowe Chizek as auditors.

VOTING SECURITIES AND OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information with respect to the
only persons known to PFC to own beneficially more than five percent of the
outstanding common shares of PFC as of March 9, 2001:

Amount and Nature of Percent of
Name and Address Beneficial Ownership Shares Outstanding
- ---------------- -------------------- ------------------

Jeffrey L. Gendell, 90,216(1) 9.04%
Tontine Financial Partners, L.P. and
Tontine Management, L.L.C.
200 Park Avenue, Suite 3900
New York, NY 10166

Wm. Gaylord Billingsley 58,800(2) 5.89%
P.O. Box 2108
1110 Dairy Lane
East Liverpool, OH 43920

Towle & Co. 53,823(3) 5.39%
12855 Flushing Meadow Drive
St. Louis, MO 63131

- ----------

(1) As reported in a Schedule 13G filed by Mr. Gendell, consists of 57,981
shares over which Mr. Gendell has sole voting and dispositive power and
32,235 shares with respect to which Mr. Gendell has shared voting and
dispositive power.

(2) Consists of 56,490 shares with respect to which Mr. Billingsley has
sole voting and dispositive power and 2,310 shares owned by Mr.
Billingsley's wife.
(Footnotes continued on next page)

2
5
(3) Consists of 21,714 shares with respect to which Towle & Co. has sole
voting and dispositive power and 32,109 shares with respect to which
Towle & Co. has shared dispositive power.

The following table sets forth certain information with respect to the
number of common shares of PFC beneficially owned by each director of PFC and by
all directors and executive officers of PFC as a group as of March 9, 2001:

Amount and Nature of Percent of
Name and Address(1) Beneficial Ownership(2) Shares Outstanding
- ------------------- ----------------------- ------------------

Edward L. Baumgardner 30,565(3) 3.00%
Arthur T. Doak 25,763(4) 2.55%
Suzanne B. Fitzgerald 5,101(5) 0.51%
William L. Miller 39,593(6) 3.92%
Timothy M. O'Hara 21,113(6) 2.09%
James R. Platte 2,879(7) 0.29%
Peter D. Visnic 35,029(8) 3.50%
All directors and executive officers
as a group (10 persons) 207,358(9) 18.99%

- ----------

(1) Each of the persons listed in this table may be contacted at the
address of PFC, 519 Broadway, East Liverpool, Ohio 43920.

(2) Each person has sole voting power and sole dispositive power unless
otherwise indicated. Each director's number of shares, except Mr.
Baumgardner's and Mr. Platte's, includes 693 shares awarded but not yet
earned under the Potters Savings and Loan Company's Recognition and
Retention Plan (the "RRP"), with respect to which the director has
voting power, but not dispositive power. Mr. Baumgardner's unearned RRP
shares total 2,079. Mr. Platte's unearned RRP shares total 1,000.

(3) Includes 20,527 shares that may be acquired pursuant to options granted
under The Potters Savings and Loan Company Stock Option Plan (the
"Potters Plan"); 3,381 shares with respect to which Mr. Baumgardner has
sole investment power as a participant in Potters Bank's 401(k)
Retirement Savings Plan (the "401(k) Plan"); 1,460 shares allocated
under Potters Financial Corporation's Employee Stock Ownership Plan
(the "ESOP"), with respect to which Mr. Baumgardner has sole voting but
not dispositive power; and 1,155 shares owned by Mr. Baumgardner's
wife.

(4) Includes 13,377 shares that may be acquired pursuant to options granted
under the Potters Plan; 30 shares not yet awarded under the RRP, with
respect to which Mr. Doak, as co-trustee of the RRP, has shared voting
power; and 9,240 shares with respect to which Mr. Doak has shared
voting and dispositive power with his wife.

(5) Includes 2,992 shares that may be acquired pursuant to options granted
under the Potters Plan and 30 shares not yet awarded under the RRP,
with respect to which Ms. Fitzgerald, as co-trustee of the RRP, has
shared voting power.

(6) Includes 13,377 shares that may be acquired pursuant to options granted
under the Potters Plan.

(7) Includes 1,417 shares that may be acquired pursuant to options granted
under the Potters Plan and 462 shares to which Mr. Platte has shared
voting and dispositive power with his wife.

(8) Includes 2,992 shares that may be acquired pursuant to options granted
under the Potters Plan.
(Footnotes continued on next page)

3
6
(9) Includes 93,997 shares that may be acquired pursuant to options granted
under the Potters Plan; 4,638 shares allocated to the ESOP accounts of
officers, with respect to which such officers have sole voting power;
and 7,703 shares held in the 401(k) Plan, with respect to which four
officers have sole dispositive power as participants.

PROPOSAL ONE

ELECTION OF DIRECTORS

The Regulations provide for a Board of Directors consisting of seven
persons. Each of the directors of PFC is also a director of Potters Bank.

In accordance with Section 2.03 of the Regulations, nominees for
election as directors may be proposed only by directors or by any shareholder
entitled to vote for the election of directors if such shareholder has submitted
a written notice of a proposed nomination to the Secretary of PFC by the close
of business on the fourteenth calendar day preceding the annual meeting of
shareholders. Each such written notice of a proposed director nominee must state
the name, age, business or residence address of the nominee, the principal
occupation or employment of the nominee, the number of common shares of PFC
owned either beneficially and/or of record by such nominee and the length of
time such shares have been so owned.

The Board of Directors proposes the re-election of the following
persons to serve until the Annual Meeting of Shareholders in 2003 and until
their successors are duly elected or until their earlier resignation, removal
from office or death:

Director Director of
of PFC Potters Bank
Name Age Position(s) Held Since Since
- ---- --- ---------------- ----- -----

William L. Miller 60 Chairman of the 1995(1) 1982
Board and Director
Edward L. Baumgardner 57 Chief Executive 1995(1) 1995
Officer, President
and Director
Suzanne B. Fitzgerald 62 Director 1997 1997
James R. Platte 55 Director 2000 2000

- ----------

(1) Messrs. Miller and Baumgardner became directors of PFC in connection
with the 1996 reorganization of Potters Bank into a wholly owned
subsidiary of PFC and the cancellation of Potters Bank common shares in
exchange for PFC common shares (the "Reorganization").

7
The following directors will continue to serve as directors after the
Annual Meeting for the terms indicated:

Director Director of
of PFC Potters Bank Term
Name Age Position Held Since(1) Since Expires
- ---- --- ------------- ----- ----- -------

Arthur T. Doak 52 Director 1995 1990 2002
Timothy M. O'Hara 51 Director 1995 1988 2002
Peter D. Visnic 54 Director 1995 1992 2002

- ----------

(1) Messrs. Doak, O'Hara and Visnic became directors of PFC in connection
with the Reorganization.

MR. MILLER has served as the Chairman of the Board of Potters Bank
since September 1991. Since 1983, Mr. Miller has been the President and Chairman
of the Board of MVP Enterprises, Inc., a nursing home provider in East
Liverpool. In addition, Mr. Miller has been a partner in Miller & Stacey, an
independent public accounting firm, since 1977.

MR. BAUMGARDNER has been the Chief Executive Officer, the President and
a Director of Potters Bank since February 1995 and of PFC since the
Reorganization. From August 1984 to October 1992, Mr. Baumgardner was the
President of Citizens Loan & Building Company of Lima, Ohio ("Citizens"). After
Citizens merged into American Community Bank, N.A. ("AmeriCom"), Mr. Baumgardner
served as the President of AmeriCom, from November 1992 to January 1995.

MS. FITZGERALD has served as Dean of the East Liverpool Campus of Kent
State University since 1987. Prior to 1987, Ms. Fitzgerald, a registered nurse,
served three years as Director of the Nursing Program at that Campus.

MR. PLATTE has been the Vice President of Manufacturing at The Hall
China Company, a manufacturer of ceramic hotel cookingware in East Liverpool,
for twenty years.

MR. DOAK has been President of The Milligan Hardware & Supply Company
in East Liverpool since 1985.

MR. O'HARA has been the Vice President of Operations of W.C. Bunting
Co., Inc., a supplier of decorative pottery in East Liverpool, since 1975.

MR. VISNIC has been the Vice President, the Licensed Administrator and
a director of MVP Enterprises, Inc. since 1983. From 1977 through 1992, Mr.
Visnic was a partner in Crable, Miller & Visnic, the predecessor of Miller &
Stacey.

MEETINGS OF DIRECTORS

The Board of Directors of PFC met 17 times for regularly scheduled
meetings, including 4 joint meetings with Potters Bank, during the fiscal year
ended December 31, 2000. No director attended fewer than 75% of the aggregate of
such meetings and all meetings of the committees of which such director was a
member.

8
Each director of PFC is also a director of Potters Bank. The Board of
Directors of Potters Bank met 18 times for regularly scheduled and special
meetings, including 4 joint meetings with PFC, during the fiscal year ended
December 31, 2000. No director attended fewer than 75% of the aggregate of such
meetings and all meetings of the committees of which such director was a member.

COMMITTEES OF DIRECTORS

The Board of Directors of PFC has an Audit Committee, an ESOP Committee
and a Stock Option Committee. PFC's Board of Directors has no nominating
committee or compensation committee.

The Audit Committee consists of Messrs. Visnic and O'Hara and Ms.
Fitzgerald and is responsible for reviewing PFC's financial statements. The
Audit Committee of PFC held three meetings during 2000.

The ESOP Committee administers the ESOP and presently is comprised of
Messrs. Doak and Platte and Ms. Fitzgerald. There were no meetings of the ESOP
Committee held during the fiscal year ended December 31, 2000.

The Stock Option Committee is responsible for administering stock
option plans, including interpreting the plans and awarding options pursuant to
their terms. Its members are Messrs. Miller, Visnic and O'Hara. The Stock Option
Committee met one time during 2000.

The Compensation and Benefits Committee of Potters Bank is responsible
for administering salaries and benefits for Potters Bank employees. Its members
are Messrs. Visnic, Doak and Platte. There were three meetings of the
Compensation and Benefits Committee during 2000.

EXECUTIVE OFFICERS

In addition to Mr. Baumgardner, the following persons are executive
officers of PFC and/or Potters Bank and hold the designated positions:

Name Age Position(s) Held
- ---- --- ----------------

Anne S. Myers 48 Senior Vice President, Secretary and Chief
Operating/Financial Officer of PFC and
Potters Bank

Albert E. Sampson 56 Senior Vice President of PFC and Senior Vice President
and Chief Lending Officer of Potters Bank

Stephen A. Beadnell 38 Vice President and Treasurer of PFC and Vice President,
Treasurer, Controller and Internal Auditor of Potters Bank

Ms. Myers has served as Vice President and Chief Operating Officer of
Potters Bank since July 1992, and was named Secretary in October 1996, Chief
Financial Officer in March 1997 and Senior Vice President in April 1998. Ms.
Myers became Vice President and Chief Operating Officer of PFC in connection
with the Reorganization, and was named Chief Financial Officer in March 1997 and
Senior Vice President in April 1999.

Mr. Sampson became Vice President and Chief Lending Officer of Potters
Bank in July 1996 and was named Senior Vice President in April 1998. Mr. Sampson
has been a Vice President of PFC since July 1996 and was named Senior Vice
President in April 1999. From 1992 through July 1996, Mr. Sampson served as Vice
President of Lending of Home Federal Bank in Hamilton, Ohio.

9
Mr. Beadnell has served as Internal Auditor of Potters Bank since April
1992. Mr. Beadnell became Controller in September 1996. In May 1998, Mr.
Beadnell was named Vice President and Treasurer of Potters Bank. In April 2000,
Mr. Beadnell was named Vice President and Treasurer of PFC.

COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS

DIRECTOR COMPENSATION

PFC does not pay fees to directors. Each non-employee director of
Potters Bank receives a fee of $4,000 per year for service as a director of
Potters Bank and an additional $325 for each meeting of the full Board of
Directors and $175 for each committee meeting attended by the director. The
Chairman of the Board receives an annual fee of $8,000 for services as Chairman
and an additional $650 for each meeting of the full Board of Directors attended,
but receives no fees for his attendance at committee meetings.

EXECUTIVE COMPENSATION

The following table presents certain information regarding compensation
received by Edward L. Baumgardner, the President and Chief Executive Officer of
PFC and Potters Bank, for the fiscal year ended December 31, 2000. Mr.
Baumgardner received the compensation included in the following table from
Potters Bank and received no compensation from PFC. No other executive officer
of Potters Bank or PFC earned salary and bonus in excess of $100,000 during the
fiscal year ended December 31, 2000.

Summary Compensation Table
--------------------------

- -------------------------------------------------------------------------------------
All Other
Annual Compensation(1) Awards Compensation
---------------------- ---------- ------------
Restricted
Name and Principal Stock
Position Year Salary($) Bonus($) Awards($)
- -------------------------------------------------------------------------------------

Edward L. Baumgardner 2000 $125,500 $10,150 -- $ 3,765(3)
President and Chief 1999 $122,000 $ 9,400 -- $14,658(4)
Executive Officer 1998 $118,000 $ 8,950 $45,000(2) $11,179(4)
- -------------------------------------------------------------------------------------

- ----------

(1) Amounts reported do not include amounts attributable to perquisites
received. The cost of such benefits was less than 10% of Mr.
Baumgardner's salary and bonus.

(2) On August 1, 1998, Mr. Baumgardner was awarded under the RRP 3,465
common shares of PFC (as adjusted to give effect to a 10% stock
dividend effective in March 1999 and a 5% stock dividend effective in
July 2000). One-fifth of such shares are earned and distributed from
the RRP trust on each of the first five anniversaries of the date the
shares are awarded. The figure represents the dollar value of such
awarded shares based on the $12.987 (as adjusted) closing sales price
per share reported by The Nasdaq Stock Market for the shares of PFC on
August 1, 1998. The aggregate fair market value of the 3,465 shares at
December 31, 2000, was $28,586, based upon the $8.25 closing sales
price on such date as reported by The Nasdaq Stock Market. Dividends
are paid on all awarded shares at the same rate as they are paid to all
shareholders and are earned and distributed from the RRP trust as the
awarded shares are earned and distributed.

(Footnotes continued on next page)

10
(3) Consists of the matching portion only of Potters Bank's contribution to
Mr. Baumgardner's 401(k) Plan account. The additional discretionary
portion of Potters Bank's contribution to Mr. Baumgardner's 401(k) Plan
account and the allocation to Mr. Baumgardner's ESOP account are not
yet available.

(4) Consists of Potters Bank's contribution to (a) Mr. Baumgardner's 401(k)
Plan account in the amounts of $7,328 in 1999 and $7,088 in 1998 and
(b) Mr. Baumgardner's ESOP account in the aggregate values of $7,330
and $4,091 in 1999 and 1998 at the dates of allocation.

STOCK OPTION PLANS

Shareholders approved two stock option plans, the first at its 1994
Annual Meeting of Shareholders and the second at its 1998 Annual Meeting of
Shareholders. Under the plan approved in 1994, 122,199 shares (as adjusted to
give effect to a stock split in the form of a stock dividend effective in
December 1997, a 10% stock dividend effective in March 1999 and a 5% stock
dividend effective in July 2000) have been reserved for issuance upon the
exercise of options to be granted to directors, officers and other key
employees. Options to purchase 122,103 shares have been granted under the 1994
plan, and options to purchase 52,420 of such shares are currently unexercised.
Pursuant to the plan approved in 1998, 56,387 shares were reserved for issuance.
Options totaling 31,500 shares were granted during 1999, and 26,351 shares were
granted during 2000 and remained unexercised at December 31, 2000. In total,
3,987 shares remain available for grants.

Both plans are administered by the Stock Option Committee of the Board
of Directors of PFC. Under both plans, the Stock Option Committee may grant
options to officers and key employees at such times as it deems most beneficial
to PFC and Potters Bank based upon the officer's or key employee's
responsibility, tenure and future potential to PFC and Potters Bank. While the
plan adopted in 1998 also provides for discretionary awards to directors, the
Potters Plan provides for automatic grants to directors which were effective at
the time of the conversion of Potters Bank from the mutual form of ownership to
the stock form of ownership (the "Conversion") or will become effective upon a
new director becoming a member of the Board of Directors.

The following table sets forth information regarding the option to
purchase 4,200 PFC common shares granted to Mr. Baumgardner during fiscal year
2000.

Aggregated Option/SAR Grants in Last Fiscal Year
- -----------------------------------------------------------------------------------------------------------------------------------

Potential Realizable
Value at Assumed Annual
Rates of Stock Price
Appreciation for
Option Term
- -----------------------------------------------------------------------------------------------------------------------------------
% of Total Options/
Number of Securities Underlying SARs Granted to Exercise or Expiration
Name Options/SARs Granted (#) Employees in Fiscal Year Base Price ($/share) Date 5%($) 10%($)
- -----------------------------------------------------------------------------------------------------------------------------------

Edward L. Baumgardner 4,200 15.9% $8.57 6/22/10 $58,630 $93,359

11
The following table sets forth information regarding the number and
value of unexercised options held by Mr. Baumgardner at December 31, 2000. No
stock appreciation rights have been granted under the Stock Option Plan.

Aggregated Option/SAR Exercises in Last Fiscal Year and at 12/31/00 Option/SAR Values
- -------------------------------------------------------------------------------------------------------

Number of Value of
Securities Underlying In-the-Money
Options/SARs at Options/SARs at
12/31/00(#) 12/31/00($)(2)

Shares Acquired Value Exercisable/ Exercisable/
Name on Exercise(#) Realized ($)(1) Unexercisable Unexercisable
- -------------------------------------------------------------------------------------------------------

Edward L. Baumgardner -0- -0- 20,527/-0- $12,127/-0-

- ----------

(1) The figure represents the value of shares received upon the exercise of
options and is determined by multiplying the number of shares exercised by the
difference between the exercise price and the fair market value on the date of
exercise.

(2) An option is "in-the-money" if the fair market value of the underlying stock
exceeds the exercise price of the option. The figure represents the value of
12,127 of such options determined by multiplying the number of shares subject to
the option by the difference between the $7.25 exercise price and the fair
market value of the common shares subject to the option, which was $8.25 per
share on December 31, 2000, based upon the closing sales price reported by The
Nasdaq Stock Market. Options to purchase 4,200 shares at an exercise price of
$12.44 and options to purchase 4,200 shares at an exercise price of $8.57 were
not "in-the-money".

RECOGNITION AND RETENTION PLAN

Shareholders approved the RRP at the 1994 Annual Meeting of
Shareholders of Potters Bank. In connection with the Conversion, 36,659 common
shares (as adjusted to give effect to a stock split in the form of a stock
dividend effective in December 1997, a 10% stock dividend effective in March
1999 and a 5% stock dividend effective in July 2000) were purchased by the RRP
trust with funds contributed by Potters Bank, and 47,163 common shares (as
adjusted) were awarded under the RRP to directors and executive officers. Since
such awards were made, 26,272 common shares have been earned and distributed to
participants and 10,534 common shares have been forfeited by the termination of
employment of participants.

The RRP is administered by the RRP Committee of the Board of Directors,
which determines awards of common shares to be made under the RRP. One-fifth of
the common shares awarded under the RRP are earned by a recipient on each
anniversary of the date of the award. Awarded but unearned common shares are
held by the RRP trust. A recipient may direct the voting of all common shares
awarded to him or her, regardless of whether such common shares have been
earned, and will be entitled to receive any dividends or other distributions
paid on all awarded but unearned common shares.

CERTAIN TRANSACTIONS

Potters Bank has made loans to certain of PFC's directors and executive
officers, their affiliates and members of their families. All loans to directors
and executive officers are made on the same terms as offered to employees in a
company-wide benefit program. Loans to all directors and employees, other than
commercial and nonowner-occupied residential loans, are made with an interest
rate 1% below the interest rate for comparable transactions with other persons,
and no document preparation fees are collected. Commercial and nonowner-occupied
residential loans are made at market interest rates and on the same terms as
offered to the general public.

12
The following table sets forth certain information regarding loans to executive
officers and directors whose indebtedness to Potters Bank exceeded $60,000 at
any time during the two year period ended December 31, 2000:

Largest Balance
during the two years Balance at
Loan Rate of ended December 31, December 31,
Name Position Origination Date Collateral Interest 2000 2000
- ------------------------------------------------------------------------------------------------------------------------------------

William L. Miller Director, Chairman 9/15/97 Personal Residence 6.125% $364,964 $348,536
William L. Miller Director, Chairman 4/30/98 Commercial Real Estate 8.75% 330,200 291,720
William L. Miller Director, Chairman 9/16/97 Home Equity Line of Credit 8.49% 25 0
Suzanne B. Fitzgerald Director 5/29/98 Personal Residence 6.375% 91,261 68,655
Suzanne B. Fitzgerald Director 6/11/98 Home Equity Line of Credit 9.24% 10,835 2,551
Timothy M. O'Hara Director 3/31/98 Personal Residence 6.375% 66,861 60,499
Timothy M. O'Hara Director 3/31/98 Home Equity Line of Credit 9.24% 10,000 312
Peter D. Visnic Director 4/07/98 Personal Residence 6.375% 97,632 88,811
Albert E. Sampson Senior Vice President 3/31/99 Personal Residence 6.875% 87,871 86,914
Albert E. Sampson Senior Vice President 7/27/98 Rental Property 9.375% 97,088 95,198
Albert E. Sampson Senior Vice President 7/10/98 Home Equity Line of Credit 8.49% 25,895 0
Albert E. Sampson Senior Vice President 11/15/96 Home Equity Line of Credit 8.50% 5,099 5,169
Stephen A. Beadnell Vice President 2/28/96 Personal Residence 7.00% 57,024 0
Stephen A. Beadnell Vice President 9/23/98 Personal Residence 6.00% 141,773 138,119
Stephen A. Beadnell Vice President 9/23/98 Home Equity Line of Credit 9.24% 4,600 4,193

None of the outstanding loans to directors and executive officers involve more
than the normal risk of collectibility or present other unfavorable features,
and all are current in their payments.

AUDIT COMMITTEE REPORT

The Audit Committee of the Board of Directors of PFC is comprised of
three directors, all of whom are considered "independent" under Rule 4200(a)(14)
of the National Association of Securities Dealers' listing standards. The Audit
Committee is responsible for overseeing PFC's accounting functions and controls,
as well as recommending to the Board of Directors an accounting firm to audit
PFC's financial statements. The Audit Committee has adopted a charter to set
forth its responsibilities (the "Charter"). A copy of the Charter is attached to
this Proxy Statement as Exhibit A.

As required by the Charter, the Audit Committee received and reviewed
the report of Crowe Chizek regarding the results of their audit, as well as the
written disclosures and the letter from Crowe Chizek required by Independence
Standards Board Standard No. 1. The Audit Committee reviewed the audited
financial statements with the management of PFC. A representative of Crowe
Chizek also discussed with the Audit Committee the independence of Crowe Chizek
from PFC, as well as matters required to be discussed by Statement on Auditing
Standards 61. Discussions between the Audit Committee and the representative of
Crowe Chizek included the following:

o Crowe Chizek's responsibilities in accordance with generally accepted
auditing standards
o The initial selection of, and whether there were any changes in,
significant accounting policies or their application
o Management's judgments and accounting estimates
o Whether there were any significant audit adjustments, including
uncorrected financial statement misstatements
o Whether there were any disagreements with management
o Whether there was any consultation with other accountants
o Whether there were any major issues discussed with management prior to
Crowe Chizek's retention
o Whether Crowe Chizek encountered any difficulties in performing the
audit
o Crowe Chizek's judgments about the quality of PFC's accounting
principles
o Crowe Chizek's responsibilities for information prepared by management
that is included in documents containing audited financial statements

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Based on its review of the financial statements and its discussions
with management and the representative of Crowe Chizek, the Audit Committee did
not become aware of any material misstatements or omissions in the financial
statements. Accordingly, the Audit Committee recommended to the Board of
Directors that the audited financial statements be included in the Annual Report
on Form 10-KSB for the year ended December 31,2000, to be filed with the
Securities and Exchange Commission.

The Audit Committee members are Mr. Peter D. Visnic, Mr. Timothy M.
O'Hara and Ms. Suzanne B. Fitzgerald.

AUDIT FEES

During the fiscal year ended December 31, 2000, Crowe Chizek billed PFC
and Potters Bank a total of $40,700 in fees for professional services in
connection with the audit of PFC's annual financial statements and the review of
financial statements included in PFC's Forms 10-QSB.

FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES

During the fiscal year ended December 31, 2000, no fees were incurred
by PFC for professional accounting services to design, implement or manage
hardware or software that collects or generates information significant to PFC's
financial statements.

ALL OTHER FEES

During the fiscal year ended December 31, 2000, Crowe Chizek billed PFC
and Potters Bank a total of $49,400 in fees for services rendered by Crowe
Chizek for all accounting services other than the services discussed under the
headings Audit Fees and Financial Information Systems Design and Implementation
Fees above.

The Audit Committee has determined that the provision of services
discussed under the heading All Other Fees is compatible with maintaining the
independence of Crowe Chizek.

14
PROPOSAL TWO

SELECTION OF AUDITORS

The Board of Directors has selected Crowe Chizek to act as the auditors
of PFC for the current fiscal year and recommends that the shareholders ratify
the selection. The firm has audited PFC and Potters Bank since 1993. Management
expects that a representative of Crowe Chizek will be present at the Annual
Meeting, will have the opportunity to make a statement if he or she so desires
and will be available to respond to appropriate questions.

THE BOARD OF DIRECTORS OF PFC RECOMMENDS THAT THE SHAREHOLDERS OF PFC
RATIFY THE SELECTION OF THE AUDITORS FOR THE CURRENT FISCAL YEAR. Accordingly,
the shareholders of PFC will be asked to approve the following resolution at the
Annual Meeting:

RESOLVED, that the selection of Crowe Chizek as the auditors of PFC for
the current fiscal year be, and it hereby is, ratified.

PROPOSALS OF SHAREHOLDERS AND OTHER MATTERS

Any proposals of shareholders intended to be included in the proxy
statement for the 2002 Annual Meeting of Shareholders of PFC should be sent to
PFC by certified mail and must be received by PFC by November 23, 2001. In
addition, if a shareholder intends to present a proposal at the 2002 Annual
Meeting without including the proposal in the proxy materials related to that
meeting, and if the proposal is not received by February 7, 2002, then the
proxies designated by the Board of Directors of PFC for the 2002 Annual Meeting
of Shareholders of PFC may vote in their discretion on any such proposal any
shares for which they have been appointed proxies without mention of such matter
in the proxy statement or on the proxy card for such meeting.

Management knows of no other business that may be brought before the
Annual Meeting. It is the intention of the persons named in the enclosed Proxy
to vote such Proxy in accordance with their best judgment on any other matters
that may be brought before the Annual Meeting.

IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. WHETHER OR NOT YOU
EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON, YOU ARE URGED TO FILL IN, SIGN
AND RETURN THE PROXY IN THE ENCLOSED SELF-ADDRESSED ENVELOPE.

By Order of the Board of Directors

East Liverpool, Ohio
March 23, 2001 Anne S. Myers, Secretary

15
Exhibit A

POTTERS FINANCIAL CORPORATION

AUDIT COMMITTEE CHARTER

PURPOSE

The purpose of the Audit Committee is to assist the Board of Directors
of the Corporation in fulfilling its responsibility to shareholders, the public
and government bodies relating to corporate accounting, reporting practices of
the Corporation and the quality and integrity of the financial reports of the
Corporation.

COMPOSITION

The Committee shall be comprised of three or more directors, as
determined by the Board, each of whom shall be independent directors and free
from any relationship that, in the opinion of the Board, would interfere with
the exercise of his or her independent judgment as a member of the Committee.
The members of the Committee shall be elected by the Board at the April meeting
of the Board or until successors shall be duly elected and qualified. The
members of the Committee may designate a chair by majority vote of the full
Committee membership.

CONTINUOUS ACTIVITIES - GENERAL

1. Provide an open avenue of communication among the Independent Auditor,
the Internal Audit Manager, and the Board of Directors.

2. Meet four times per year or more frequently as circumstances require.
The Committee may ask members of management or others to attend
meetings and provide pertinent information as necessary.

3. Confirm and assure the independence of the Independent Auditor and the
objectivity of the Internal Audit Manager. Recommend to the Board the
selection of independent accountants, considering independence and
effectiveness and in light of the independent accountants' ultimate
responsibility of the Committee and the Board to select evaluate and,
where appropriate, replace the independent accountants (or to nominate
the independent accountants to be proposed for shareholder approval in
any proxy statement). The Committee should ensure that the independent
accountants submit to the Committee periodically a written statement of
all relationships between the independent accountants and the
Corporation, consistent with Independence Standards Board Standard No.
1 and engage in active dialogue with the independent accountants about
all significant relationships the accountants have with the Corporation
to determine the accountants' independence.

4. Review with the Independent Auditor and the Internal Audit Manager the
coordination of audit efforts to assure completeness of coverage,
reduction of redundant efforts and the effective use of audit
resources.

5. Inquire of management, the Independent Auditor and the Internal Audit
Manager about significant risks or exposures and assess the steps
management has taken to minimize such risk to the Company and related
entities.

6. Consider and review with the Independent Auditor and the Internal Audit
Manager:

o The adequacy of Company and Related Entities' internal
controls including computerized information system controls
and security.

16
o Related findings and recommendations of the Independent
Auditor and Internal Audit Manager together with management's
responses.

o The Committee's review should include the matters required to
be discussed by Statement on Auditing Standards No. 61 and an
explanation from the independent accountants of the factors
considered by the independent accountants in determining the
audit's scope. The accountants should confirm that no
limitations have been placed on the scope or nature of the
audit. The Committee should recommend to the Board whether the
audited financial statements should be contained in the
Corporation's Annual Report on Form 10-KSB to be filed with
the Securities and Exchange Commission.

o Review communications, if any, from the independent
accountants with respect to interim financial information
before the filing of the Quarterly Report on Form 10-QSB with
the Securities and Exchange Commission and discuss such
communications with management of the Corporation. The chair
of the Committee may represent the entire Committee for
purposes of receipts of communications and discussion with
management.

o Prepare a report to be included in the Proxy Statement for the
Corporation's annual meetings of shareholders, as required by
the regulations of the Securities and Exchange Commission.

7. Consider and review with management, the Internal Audit Manager and the
Independent Auditor:

o Significant findings during the year, including the status of
previous audit recommendations.

o Any difficulties encountered in the course of audit work
including any restrictions on the scope of activities or
access to required information.

o Any changes required in the planned scope of the Internal
Audit plan.

o The Internal Audit Department charters, budget and staffing.

8. Meet periodically with the Independent Auditor, the Internal Audit
Manager and management in separate executive sessions to discuss any
matters that the Committee or these groups believe should be discussed
privately with the Audit Committee.

9. Report periodically to the Board of Directors on significant results of
the foregoing activities.

10. Instruct the Independent Auditor that the Board of Directors, as the
shareholders' representative, is the auditor's client.

11. Review and update this Charter periodically as conditions dictate, but
at least annually.

CONTINUOUS ACTIVITIES - RE: REPORTING SPECIFIC POLICIES

1. Advise financial management and the Independent Auditor they are
expected to provide a timely analysis of significant current financial
reporting issues and practices.

2. Provide that financial management and the Independent Auditor discuss
with the audit committee their qualitative judgments about the
appropriateness, not just the acceptability, of accounting principles
and financial disclosure practices used or proposed to be adopted by
the Institution and, particularly, about the degree of aggressiveness
or conservatism of its accounting principles and underlying estimates.

17
3. Inquire as to the auditor's independent qualitative judgments about the
appropriateness, not just the acceptability, of the accounting
principles and the clarity of the financial disclosure practices used
or proposed to be adopted by the Institution.

4. Inquire as to the auditor's views about whether management's choices of
accounting principles are conservative, moderate, or aggressive from
the perspective of income, asset, and liability recognition, and
whether those principles are common practices or are minority
practices.

5. Determine, as regards to new transactions or events, the auditor's
reasoning for the appropriateness of the accounting principles and
disclosure practices adopted by management.

6. Assure that the auditor's reasoning is described in determining the
appropriateness of changes in accounting principles and disclosure
practices.

7. Inquire as to the auditor's views about how the Institution's choices
of accounting principles and disclosure practices may affect
shareholders and public views and attitudes about the Institution.

While the committee has the responsibilities and powers set forth in this
Charter, it is not the duty of the Committee to plan or conduct audits or to
determine the Corporation's financial statements are complete and accurate and
prepared in accordance with generally accepted accounting principles. That is
the responsibility of management and the Corporation's independent accountants.

15
18
[X] PLEASE MARK VOTES
AS IN THIS EXAMPLE

THIS PROXY IS SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS OF
POTTERS FINANCIAL CORPORATION

2001 ANNUAL MEETING OF SHAREHOLDERS
APRIL 26, 2001

The undersigned shareholder of Potters Financial Corporation ("PFC") hereby
constitutes and appoints Arthur T. Doak and Peter D. Visnic, or either one of
them, as the Proxy or Proxies of the undersigned, with full power of
substitution and resubstitution, to vote at the Annual Meeting of Shareholders
of PFC to be held at Kent State University, East Liverpool Campus, The Brown
Community Room, Room 202, 213 East Fourth Street, East Liverpool, Ohio, on April
26, 2001, at 10:00 A.M. (the "Annual Meeting"), all of the shares of PFC which
the undersigned is entitled to vote at the Annual Meeting, or at any adjournment
thereof, on each of the following proposals, all of which are described in the
accompanying Proxy Statement:

REVOCABLE PROXY
POTTERS FINANCIAL
CORPORATION

FOR WITH- FOR ALL
HOLD EXCEPT
1.The election of four
directors: [ ] [ ] [ ]

WILLIAM L. MILLER
EDWARD L. BAUMGARDNER
SUZANNE B. FITZGERALD
JAMES R. PLATTE

INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, MARK "FOR
ALL EXCEPT" ABOVE AND WRITE THAT NOMINEE'S NAME IN THE SPACE PROVIDED BELOW.

- --------------------------------------------------

FOR AGAINST ABSTAIN

2.The ratification of the [ ] [ ] [ ]
selection of Crowe,
Chizek and Company LLP
as the auditors of PFC for
the current year.

3.In their discretion, upon such other business as may
properly come before the Annual Meeting or any
adjournment thereof.

This Proxy, when properly executed, will be voted in the
manner directed herein by the undersigned shareholder.
Unless otherwise specified, the shares will be voted FOR
Proposals 1 and 2.

Please sign exactly as your name appears on your Stock
Certificate(s). Executors, Administrators, Trustees,
Guardians, Attorneys and Agents should give their full
titles.

--------------
Please be sure to sign and date Date
this Proxy in the box below.
- ------------------------------------------------------

Shareholder sign above Co-holder (if any) sign above
- ------------------------------------------------------

- --------------------------------------------------------------------------------
DETACH ABOVE CARD, SIGN, DATE AND MAIL IN POSTAGE PAID ENVELOPE PROVIDED

POTTERS FINANCIAL CORPORATION

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PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
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