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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report July 8, 1998
United Community Financial Corp.
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(Exact name of registrant as specified in its charter)
Ohio 0-24399 34-1856319
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(State or other jurisdiction (Commission (IRS Employer of
incorporation ) File Number) Identification Number)
275 Federal Plaza West
Youngstown, Ohio 44503-0500
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (330) 742-0500
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Not Applicable
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(Former name or former address, if changes since last report.)
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TABLE OF CONTENTS
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PAGE
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Items 1 - 4 - Not Applicable
Item 5 Other Events
Exhibit 1 Second Quarter Financial Information News Release. . . 1-3
Items 6 - 9 - Not Applicable
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UNITED COMMUNITY FINANCIAL CORP.
275 Federal Plaza West
Youngstown, Ohio 44503-1203
FOR IMMEDIATE RELEASE
Douglas M. McKay
President
(330) 742-0500, ext. 801
UNITED COMMUNITY FINANCIAL CORPORATION ANNOUNCES SECOND QUARTER EARNINGS AND
SUBSTANTIAL INCREASE IN CORE EARNINGS
Youngstown, Ohio - July 8, 1998 - United Community Financial Corp.
(NASDAQ/NMS:UCFC), Holding Company for The Home Savings and Loan Company of
Youngstown, Ohio, (the "Company"), announced that net income for the three
months ended June 30, 1998 was $3.5 million. Net income for the comparable
period in the prior year was $6.1 million. The change in the current period
when compared to the prior period was due to a significant recovery in June 1997
of two previously delinquent loans that had previously been charged off
resulting in a recovery of $3.1 million of interest and a loan loss recovery of
$2.8 million. A more direct comparison of operating results is to compare
pretax core earnings for the two periods. Core earnings are defined as pretax
earnings adjusted for securities sales transactions and unusual or nonrecurring
expense or income items. On this basis, core earnings for the three months
ended June 30, 1998 were $5.1 million compared to $3.4 million in the prior year
period.
Net income for the six months ended June 30, 1998 was $6.2 million. Net income
for the comparable period in the prior year was $8.8 million. The change in the
current period is primarily due to the significant recovery discussed above.
Core earnings as defined above for the six months ended June 30, 1998 were $9.2
million compared to $7.4 million in the prior year period.
Earnings per common share have not been presented in this information release as
United Community Financial Corp. is currently in the process of completing the
Conversion from a mutual to a stock association. Earnings per common share will
be presented from the effective date of the Conversion.
Douglas M. McKay, President of United Community Financial Corp. said, "Earnings,
particularly when viewed on the basis of pretax core earnings, reflect a
substantial increase in net interest income. This is primarily due to a
reduction in our overall cost of
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interest bearing liabilities as well as continued management of our costs which
corresponds to our business plan."
On December 9, 1997 the Board of Directors of the Company adopted a Plan of
Conversion to convert from an Ohio mutual savings and loan association to an
Ohio capital stock savings and loan association, and to form a Holding Company
to own the savings and loan association. The Holding Company was formed in
February 1998. The Conversion is expected to be completed on July 8, 1998. The
increase in deposits and assets at June 30, 1998, compared to June 30, 1997 is
primarily attributable to funds held in special subscription savings accounts in
connection with the conversion.
The Company continues to be well capitalized under the Prompt Corrective Action
provisions of Federal banking laws and regulations. The equity to total assets
of the Company as of June 30, 1998 was 8.71%.
The Company has 14 offices located throughout Mahoning, Columbiana and Trumbull
Counties in Northeastern Ohio. Additional information may be found at the
Company's web site: www.homesavingsandloan.com.
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UNITED COMMUNITY FINANCIAL CORP.
SELECTED FINANCIAL DATA
(IN THOUSANDS)
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June 30,
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1998 1997
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SELECTED FINANCIAL CONDITION DATA:
Total assets $1,692,707 $1,062,412
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Allowance for loan losses 6,172 5,313
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Total deposits 1,527,893 906,450
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Total equity 147,500 136,803
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Three months ended
June 30,
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1998 1997
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SUMMARY OF EARNINGS:
Net interest income $11,057 $12,917
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Provision for loan losses 150 (2,246)
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Total noninterest income 684 376
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Total noninterest expense 6,263 6,228
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Net income 3,462 6,124
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</TABLE>
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Three months ended
June 30,
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1998 1997
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SUMMARY OF CORE EARNINGS:
Net interest income $11,057 $9,809
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Provision for loan losses 150 600
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Total noninterest income, excluding
gains & losses 450 392
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Total noninterest expense 6,263 6,228
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Pre-tax Core Earnings 5,088 3,357
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</TABLE>
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Six months ended
June 30,
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1998 1997
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SUMMARY OF EARNINGS:
Net interest income $21,179 $22,707
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Provision for loan losses 400 (2,246)
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Total noninterest income 1,062 674
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Total noninterest expense 12,358 12,233
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Net income 6,163 8,847
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</TABLE>
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<CAPTION>
Six months ended
June 30,
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1998 1997
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SUMMARY OF CORE EARNINGS:
Net interest income $21,179 $19,599
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Provision for loan losses 400 600
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Total noninterest income, excluding
gains & losses 867 681
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Total noninterest expense 12,358 12,233
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Pre-tax Core Earnings 9,230 7,440
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</TABLE>
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