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EXHIBIT 99
Contact: INVESTORS
Patrick A. Kelly
United Community Financial Corp.
(330) 742-0592
MEDIA MEDIA
Susan E. Stricklin James King
United Community Financial Corp. Edward Howard & Co.
(330) 742-0638 (216) 781-2400
FOR IMMEDIATE RELEASE
UNITED COMMUNITY COMPLETES ACQUISITION
OF INDUSTRIAL BANCORP, INC.
BRANCHES TO BECOME NORTHWEST DIVISION OF HOME SAVINGS AND LOAN
YOUNGSTOWN, Ohio (July 2, 2001) - United Community Financial Corp. (Nasdaq:
UCFC), holding company of The Home Savings and Loan Company and Butler Wick
Corp., announced today it completed its acquisition of Bellevue-based Industrial
Bancorp, Inc. on July 1, 2001.
"This acquisition is a significant step in implementing our strategic plan to
grow our company through product and geographic expansion," said Douglas M.
McKay, chairman and president of United Community. "It further strengthens
United Community's ability to maximize growth opportunities in new markets."
Industrial Savings and Loan, the sole subsidiary of Industrial Bancorp, Inc.,
has 12 branches located in Ashland, Bellevue, Clyde, Fremont, Findlay,
Lexington, Norwalk, Sandusky, Tiffin and Willard. These branches will now
operate as the northwest division under the Home Savings name. David Windau, the
former president and chief executive officer of Industrial, will lead the
northwest division and report to David G. Lodge, president and chief operating
officer of Home Savings.
Home Savings is a community bank with a long-standing tradition of meeting and
exceeding the expectations and financial needs of customers within each local
community served. "Customers of Industrial can still count on the same friendly
faces, branch locations and quality service they have come to know," said Lodge.
"One of the most attractive aspects of this acquisition was the ability to
retain 100 percent of the employee base."
Customers in the northwest division can expect to see an expanded array of
financial products and services from Home Savings, including new deposit,
lending and business
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programs. Later this year, when the computer systems of the two organizations
are integrated, 24-hour online and telephone banking will also be made available
in these areas. At the same time, branch signage will reflect the name change.
United Community Financial Corp. is an Ohio-based unitary thrift holding
company. Its subsidiaries include The Home Savings and Loan Company and Butler
Wick Corp. Home Savings has 29 full-service branches and four loan production
offices located throughout Northeastern Ohio, while Butler Wick has 11 offices
located throughout Northeastern Ohio and Western Pennsylvania. Additional
information on United Community may be found on its web site:
www.ucfconline.com.
This press release includes statements that may constitute forward-looking
statements made pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Statements related to the name change to Home
Savings and the integration of computer systems are forward-looking in nature.
These statements are subject to risks and uncertainties that could cause actual
results to differ materially from the forward-looking statements.
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UNITED COMMUNITY FINANCIAL CORP.
PRO-FORMA STATEMENT OF FINANCIAL CONDITION
MARCH 31, 2001
(dollars in thousands)
Historical
-----------------------------
United Industrial Pro-forma
Community Bancorp Adjustments Notes Consolidated
--------------------------------------------------------------------------
Assets:
Cash and deposits with banks $ 26,656 $ 1,245 $ (5,540) (4) $ 22,361
Federal funds sold and other 45,321 24,830 70,151
------------------------------------------ -----------
Total cash and cash equivalents 71,977 26,075 (5,540) 92,512
------------------------------------------ -----------
Investment securities:
Trading 5,968 5,968
Available for sale 79,415 12,019 91,434
Held to maturity 881 881
Mortgage-related securities:
Available for sale 97,741 97,741
Held to maturity 100,651 110 7 (2) 100,761
(7) (3)
Loans, net 927,399 379,236 6,367 (2) 1,310,909
(2,093) (3)
Margin accounts 29,350 29,350
Federal Home Loan Bank stock 14,039 3,820 17,859
Premises and equipment 11,964 5,216 180 (2) 17,352
(8) (3)
Accrued interest receivable 8,222 2,520 10,742
Real estate owned 349 349
Other assets 8,802 595 7,077 (2) 32,321
18,121 (1)
215 (2)
(37) (3)
(2,452) (3)
------------------------------------------ -----------
Total assets $ 1,356,758 $ 429,591 $ 21,830 $ 1,808,179
========================================== ===========
Liabilities:
Deposits $ 939,693 $ 315,703 $ 3,619 (2) $ 1,256,400
(2,615) (3)
Other borrowed funds 138,516 50,000 664 (2) 275,966
87,302 (1)
(516) (3)
Advance payments by borrowers for taxes and insurance 2,564 929 3,493
Accrued interest payable 3,612 1,481 5,093
Accrued expenses and other liabilities 14,822 1,860 348 (3) 15,091
(1,939) (4)
------------------------------------------ -----------
Total liabilities 1,099,207 369,973 86,863 1,556,043
------------------------------------------ -----------
Shareholders' Equity:
Preferred stock -- -- -- --
Common stock 136,989 38,091 (38,091) (1) 136,989
Retained earnings 155,706 43,151 (43,151) (1) 150,291
(3,601) (4)
(1,814) (3)
Accumulated other comprehensive income 1,009 1,995 (1,995) (1) 1,009
Unearned stock compensation (25,795) (2,243) 2,243 (1) (25,795)
Treasury stock (10,358) (21,376) 21,376 (1) (10,358)
------------------------------------------ -----------
Total shareholders' equity 257,551 59,618 (65,033) 252,136
------------------------------------------ -----------
Total liabilities and shareholders;' equity $ 1,356,758 $ 429,591 $ 21,830 $ 1,808,179
========================================== ===========
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UNITED COMMUNITY FINANCIAL CORP.
PRO-FORMA STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDING MARCH 31, 2001
(dollars in thousands, except per share data)
Historical
-----------------------------------
United Industrial Pro-forma
Community Bancorp Adjustments Notes Consolidated
------------------------------------------------------------------------------
Interest income
Loans $ 18,074 $ 8,081 $ (268) (3) $ 25,887
Mortgage-related securities:
Available for sale 1,464 1,464
Held to maturity 1,782 3 1,785
Investment securities:
Trading 31 31
Available for sale 1,332 174 1,506
Held to maturity 13 13
Margin accounts 668 668
FHLB stock dividend 246 67 313
Other interest-earning assets 428 190 618
----------------------------------------------- ----------------
Total interest income 24,038 8,515 (268) 32,285
Interest expense
Interest on deposits 10,284 3,953 (230) (3) 14,007
Interest on Federal Home Loan Bank advances 1,397 775 1,096 (4) 3,218
(50) (3)
----------------------------------------------- ----------------
Total interest expense 11,681 4,728 816 17,225
----------------------------------------------- ----------------
Net interest income 12,357 3,787 (1,084) 15,060
Provision for loan loss allowances 330 120 450
----------------------------------------------- ----------------
Net interest income after provision for
loan loss allowances 12,027 3,667 (1,084) 14,610
----------------------------------------------- ----------------
Noninterest income
Commissions 3,591 3,591
Service fees and other charges 1,919 204 2,123
Underwriting and investment banking fees 63 63
Net gains (losses):
Mortgage-related securities 92 92
Investment securities 245 245
Trading securities (411) (411)
Loans 25 67 92
Other (9) 21 12
Other income 273 7 (7) (3) 273
----------------------------------------------- ----------------
Total noninterest income 5,788 299 (7) 6,080
----------------------------------------------- ----------------
Noninterest expenses
Salaries and employee benefits 7,864 950 8,814
Occupancy 573 121 2 (3) 696
Equipment and data processing 1,619 203 1,822
Deposit insurance premiums 42 15 57
Franchise tax 510 20 530
Advertising 551 26 577
Other expenses 1,620 377 320 (3) 2,317
----------------------------------------------- ----------------
Total noninterest expense 12,779 1,712 322 14,813
----------------------------------------------- ----------------
Income before income taxes 5,036 2,254 (1,413) 5,877
Income taxes 1,834 815 (384) (4) 2,267
2 (3)
----------------------------------------------- ----------------
Net income $ 3,202 $ 1,439 $ (1,031) $ 3,610
=============================================== ================
EPS shares:
Basic 32,671 4,135 (4,135) 32,671
Diluted 32,815 4,245 (4,245) 32,815
Basic earnings per share $ 0.10 $ 0.35 $ 0.11
Diluted earnings per share $ 0.10 $ 0.34 $ 0.11
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UNITED COMMUNITY FINANCIAL CORP.
PRO-FORMA STATEMENT OF OPERATIONS
FOR THE TWELVE MONTHS ENDING DECEMBER 31, 2000
(dollars in thousands, except per share data)
Historical
------------------------------
United Industrial Pro-forma
Community Bancorp Adjustments Notes Consolidated
--------------------------------------------------------------------------------
Interest income
Loans $ 62,836 $ 30,111 $ (1,825) (3) $ 91,122
Mortgage-related securities:
Available for sale 6,737 6,737
Held to maturity 8,651 16 (7) (3) 8,660
Investment securities:
Trading 145 145
Available for sale 7,896 800 8,696
Held to maturity 62 62
Margin accounts 3,565 3,565
FHLB stock dividend 968 263 1,231
Other interest-earning assets 762 874 1,636
----------------------------------------------- -----------------
Total interest income 91,622 32,064 (1,832) 121,854
Interest expense
Interest on deposits 35,394 14,694 (2,385) (3) 47,703
Interest on Federal Home Loan Bank advances 8,710 2,833 4,444 (4) 15,521
(466) (3)
----------------------------------------------- -----------------
Total interest expense 44,104 17,527 1,593 63,224
----------------------------------------------- -----------------
Net interest income 47,518 14,537 (3,425) 58,630
Provision for loan loss allowances 300 113 413
----------------------------------------------- -----------------
Net interest income after provision for
loan loss allowances 47,218 14,424 (3,425) 58,217
----------------------------------------------- -----------------
Noninterest income
Commissions 17,176 17,176
Service fees and other charges 5,607 830 6,437
Underwriting and investment banking fees 646 646
Net gains (losses):
Mortgage-related securities 115 115
Investment securities 36 182 218
Trading securities 241 241
Loans 116 116
Other (2) 13 11
Other income 935 34 (30) (3) 939
----------------------------------------------- -----------------
Total noninterest income 24,754 1,175 (30) 25,899
----------------------------------------------- -----------------
Noninterest expenses
Salaries and employee benefits 36,193 3,477 39,670
Gain on porstretirement curtailment (2,928) (2,928)
Loss on pension termination 1,008 1,008
Occupancy 2,093 478 6 (3) 2,577
Equipment and data processing 5,807 880 6,687
Deposit insurance premiums 168 61 229
Franchise tax 3,710 399 4,109
Advertising 1,924 221 2,145
Other expenses 6,332 1,303 2,132 (3) 9,767
----------------------------------------------- -----------------
Total noninterest expense 54,307 6,819 2,138 63,264
----------------------------------------------- -----------------
Income before income taxes 17,665 8,780 (5,593) 20,852
Income taxes 6,051 3,081 (1,555) (4) 7,923
346 (3)
----------------------------------------------- -----------------
Net income $ 11,614 $ 5,699 $ (4,384) $ 12,929
=============================================== =================
EPS shares:
Basic 33,186 4,116 (4,116) 33,186
Diluted 33,316 4,152 (4,152) 33,316
Basic earnings per share $ 0.35 $ 1.38 $ 0.39
Diluted earnings per share $ 0.35 $ 1.37 $ 0.39
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UNITED COMMUNITY FINANCIAL CORP.
NOTES TO UNAUDITED PRO-FORMA CONSOLIDATED FINANCIAL STATEMENTS (dollars in
thousands, except per share data)
Basis of Presentation:
The following pro-forma adjustments are based on available information and
certain estimates and assumptions. Therefore, it is likely that the actual
adjustments will differ from the pro-forma adjustments. United Community
believes that such assumptions provide a reasonable basis for presenting all of
the significant effects of the following transactions and that the pro-forma
adjustments give appropriate effect to those assumptions and are properly
applied in the unaudited pro-forma consolidated financial statements.
Adjustments to Pro-forma Consolidated Financial Statements
(1) Represents the acquisition for a total purchase price of $$87,302. The
acquisition, which was paid in cash, is summarized as follows:
Total cash paid to INBI shareholders $ 87,302
Industrial Bancorp shareholders' equity 59,618
-----------------
Acquisition cost in excess of book value 27,684
Adjustments to reflect fair value (see (2) below) (9,563)
-----------------
Total goodwill $ 18,121
=================
(2) Represents adjustments to reflect fair values of assets and liabilities as
follows:
Mortgage-related securities held to maturity 7
Loans, net 6,367
Premises and equipment 180
Mortgage servicing rights 215
Core deposit intangible 7,077
Deposits (3,619)
FHLB advances (664)
-----------------
Total fair value adjustments 9,563
=================
(3) Represents the amortization of the purchase accounting adjustments over the
following periods:
Weighted
Average Amortization
Life Method
------------------------------
Mortgage-related securities held to maturity 6 months straight line
Loans, net 7 years level yield
Premises and equipment 15 years straight line
Mortgage servicing rights 7.5 years level yield
Core deposit intangible 5 years level yield
Deposits 3 years level yield
FHLB advances 1 year level yield
(4) Represents interest expense on FHLB advances used to fund the acquisition
and the related income tax effect.
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