<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
Under the Securities Exchange Act of 1934
(Amendment No. 3)<F1>
Home City Financial Corporation
(Name of Issuer)
Common Stock, having no par value
(Title of Class of Securities)
43706C 10 0
(CUSIP Number)
Jerome H. Davis
c/o David M. Perlmutter, Esq.
200 Park Ave., Suite 4515, New York, NY 10166
(212) 986-4900
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 5, 1997
(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on
Schedule 13G to report the acquisition which is the subject of
this Schedule 13D, and is filing this schedule because of Rule
13d-1 (b)(3) or (4), check the following box / /.
Note: Six copies of this statement, including all
exhibits, should be filed with the Commission. See Rule 13d-1(a)
for other parties to whom copies are to be sent.
(Continued on following pages)
_________________________
<F1>
1 The remainder of this cover page shall be filled out for
a reporting person's initial filing of this form with respect to
the subject class of securities, and for any subsequent amendment
containing information which would alter disclosures provided in
a prior cover page.
The information required on the remainder of this cover page
shall not be deemed to be "filed" for the purpose of Section 18
of the Securities Exchange Act of 1934 or otherwise subject to
the liabilities of that section of the Act but shall be subject
to all other provisions of the Act (however, see the Notes).
Page 1 of 8 Pages
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CUSIP No. 43706C 10 0
_________________________________________________________________
1. Name of Reporting Person Jerome H. Davis
_________________________________________________________________
S.S. or I.R.S. Identification ###-##-####
No. of Above Person
_________________________________________________________________
2. Check the Appropriate Box (a)______
if a Member of a Group (b)___X__
(See Instructions)
_________________________________________________________________
3. SEC Use Only
_________________________________________________________________
4. Source of Funds (See Instructions)
PF
_________________________________________________________________
5. Check Box if Disclosure of Legal
Proceedings is Required / /
Pursuant to Items 2(d) or 2(e)
_________________________________________________________________
6. Citizenship or Place of
Organization United States
_________________________________________________________________
Number of 7. Sole Voting Power 38,997
Shares 8. Shared Voting
Beneficially Power 53,544*<F2>
Owned by 9. Sole Dispositive
Each Report- Power 38,997
ing Person 10. Shared Dispositive
with Power 53,544*<F2>
_________________________________________________________________
11. Aggregate Amount Beneficially
Owned by Each Reporting Person 92,541*<F2>
_________________________________________________________________
12. Check Box if the Aggregate Amount
in Row (11) Excludes Certain / /
Shares (See Instructions)
_________________________________________________________________
13. Percent of Class Represented
by amount in Row (11) 9.71%
_________________________________________________________________
14. Type of Reporting Person IN
(See Instructions)
_________________________________________________________________
<F2>
* See Items 5(a) and 5(b) of this Statement. For purposes of
this Statement Jerome H. Davis may be deemed, pursuant to Rules
13d-3(a)(1) and 13d-3(a)(2) under the Securities Exchange Act of
1934, as amended, to be the beneficial owner of 9,522 shares of
the Company's Common Stock, no par value, held in the name of his
wife, Susan B. Davis.
Page 2 of 8 Pages
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CUSIP No. 43706C 10 0
_________________________________________________________________
1. Name of Reporting Person Susan B. Davis
_________________________________________________________________
S.S. or I.R.S. Identification ###-##-####
No. of Above Person
_________________________________________________________________
2. Check the Appropriate Box (a)______
if a Member of a Group (b)___X__
(See Instructions)
_________________________________________________________________
3. SEC Use Only
_________________________________________________________________
4. Source of Funds (See Instructions)
PF
_________________________________________________________________
5. Check Box if Disclosure of Legal
Proceedings is Required / /
Pursuant to Items 2(d) or 2(e)
_________________________________________________________________
6. Citizenship or Place of
Organization United States
_________________________________________________________________
Number of 7. Sole Voting Power 9,522
Shares 8. Shared Voting
Beneficially Power 83,019*<F3>
Owned by 9. Sole Dispositive
Each Report- Power 9,522
ing Person 10. Shared Dispositive
with Power 83,019*<F3>
_________________________________________________________________
11. Aggregate Amount Beneficially
Owned by Each Reporting Person 92,541*<F3>
_________________________________________________________________
12. Check Box if the Aggregate Amount
in Row (11) Excludes Certain / /
Shares (See Instructions)
_________________________________________________________________
13. Percent of Class Represented
by amount in Row (11) 9.71%
_________________________________________________________________
14. Type of Reporting Person IN
(See Instructions)
_________________________________________________________________
<F3>
* See Items 5(a) and 5(b) of this Statement. For purposes of
this Statement Susan B. Davis may be deemed, pursuant to Rules
13d-3(a)(1) and 13d-3(a)(2) under the Securities Exchange Act of
1934, as amended, to be the beneficial owner of 38,997 shares of
the Company's Common Stock, no par value, held in the name of her
husband, Jerome H. Davis.
Page 3 of 8 Pages
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The Statement on Schedule 13D (the "Statement") of
Jerome H. Davis, with respect to the Common Stock, no par value
("Common Stock") of Home City Financial Corporation, an Ohio
corporation ("Home City") is hereby amended as set forth below.
Item 4 of the Statement is hereby supplemented by the
addition of the following:
"Following his review of Home City's financial results
for the March, 1997 quarter, Mr. Davis wrote to Home City's Board
of Directors to convey his concerns regarding its poor financial
performance. A copy of Mr. Davis' May 5, 1997 letter to Home
City's Board of Directors is attached hereto as Exhibit No. 2.
In his letter, Mr. Davis expresses the following
concerns regarding Home City's recent financial results:
1) EARNINGS. Home City's rate of earning
(pro-forma) for the March quarter declined from the similar rates
realized for the prior September and December quarters. Home
City's net earnings of $178,000 during this recent quarter do not
justify any increase in the price of the Common Stock ($.75 per
share annualized on 952,000 shares outstanding). This results in
a very rich current PE ratio of 17.9 based on a stock price of
$13.25. Such low earnings may even lead to a decline in the price
of the Common Stock.
2) EXPENSES. Home City's G&A to assets ratio is too
high at 2.18 when annualized for the March quarter, and its
efficiency ratio of 56% has risen to its worst level in the past
3 quarters. Expenses must be reduced in order to improve profits.
3) RETURN ON ASSETS. At 1.04%, Home City's return
on assets is at its lowest level in the past 3 quarters. This is
down from 1.26% at September 30, 1996, and 1.13% at December 31,
1996.
4) RETURN ON EQUITY. Return on equity is
only 5% when annualized based on Home City's recent March results.
5) DEPOSITS. Home City's deposits have shown no
significant growth in the past 6 months. Its additional deposits
of just $600,000 during this period represents a percentage
increase of only 1.2%
In view of Home City's recent mediocre performance, Mr.
Davis has reservations regarding the present value of the Common
Stocks. He believes it may decline unless Home City improves its
results for the June quarter to a minimum of $250,000 in net
earnings. In the interim, Home City can enhance the value of
Page 4 of 8 Pages
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the Common Stock by doing a 5% (or 10% if allowable) stock
repurchase. It is noted that Home City will have been a public
company for the required 6 months at the end of June.
In addition, Mr. Davis believes that Home City's
excessive capital-to-assets ratio of 20.6% warrants the declaration
of a large special dividend. Such a dividend should be a tax-
free return of capital, if possible. He hopes that Home City is
currently working on this matter along with its accountants, the
Charles Webb Co., and the IRS.
Mr. Davis concludes his letter by recommending that
Home City declare a $.10 dividend for the next quarter. After its
recently announced dividend, this is an appropriate next step to
further enhance of the value of the Common Stock. Mr. Davis plans
to engage in further communications and discussions with Home
City's management, Board of Directors and possibly other
shareholders regarding the matters discussed in his letter.
Other than as described above, Mr. and Mrs. Davis do
not have any plan or proposal which relates to or would result in
any of the actions enumerated in Item 4 of Schedule 13D, except
that Mr. and Mrs. Davis may dispose of some or all of the Common
Stock or may acquire additional shares of Common Stock, from time
to time, depending upon price and market conditions, evaluation
of alternative investments, and other factors."
Item 7. MATERIALS TO BE FILED AS EXHIBITS.
The information set forth in Item 7 of the Statement is
hereby supplemented by the addition of the following:
"2. Letter dated May 5, 1997 from Jerome H. Davis to
the Board of Directors of Home City Financial Corp."
Page 5 of 8 Pages
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Signature.
After reasonable inquiry and to the best knowledge and
belief of the undersigned, the undersigned certify that the
information set forth in this amendment is true, complete and
correct.
5/7/97 Jerome H. Davis
Date (Signature)
5/7/97 Susan B. Davis
Date (Signature)
Page 6 of 8 Pages
Exhibit No. 2
May 5, 1997
The Board of Directors
Home City Financial Corp.
63 West Main Street
Springfield, OH 45502
Gentlemen:
I have reviewed your March quarterly financial results.
They are mediocre at best. These results add no enhancement to our
stock.
I. EARNINGS.
In previous quarters (September and December) the rate of
earnings (pro-forma) ran at a higher rate than those realized for
the March quarter. At $178,000 net for the March quarter, a higher
stock price is unfortunately unjustified ($.75 per share annualized
on full 952,000 shares outstanding). This equates to a very rich
PE ratio of 17.9 currently (stock price at $13.25). In fact, a
decline in the stock value could easily occur on these meager
earnings.
II. EXPENSES.
G&A is too high, at a ratio-to-assets of 2.18 now
(annualized for the March quarter). Similarly, efficiency ratio
has risen to the worst level of the past 3 quarters, now at 56%.
Expenses must be cut to provide for added profits.
III. RETURN ON ASSETS.
Now at the lowest level of the past 3 quarters - 1.04%,
down from 1.26% at 9/30/96 and 1.13% at 12/31/96.
IV. RETURN ON EQUITY.
Poor, at only 5%, annualized, for the March quarter.
Page 7 of 8 Pages
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The Board of Directors
Home City Financial Corp.
May 5, 1997
Page 2
V. DEPOSITS.
Not growing - up only $600,000 over 6 months (9/96
thru 3/97), an increase of only 1.2%.
In view of all the foregoing, I am concerned about our
stocks present value, and fearful of a decline, unless your June
quarter results are much better - at least $250,000.
In order to enhance value in the interim, you need to do
a 5% (or 10% if allowable) stock repurchase at the earliest
opportunity. In late June you will have been public the required
6 months.
Also, your excessive capital-to-assets ratio of 20.6%
dictates a large special dividend, preferably a tax-free return of
capital, but taxable if that is all that is possible. I hope you
are working closely with your accountants, the Charles Webb Co.,
and the IRS on this matter currently.
Your recent dividend declaration was only a first, small
step in what needs to be done to cause any further enhancement in
the stock value. I would argue that a dividend of $.10 for the
next quarter would be appropriate, all things considered.
I would welcome your comments.
Very truly yours,
Jerome H. Davis
(signature)
P.S. At 3/31/97, what are total NPA's?
Page 8 of 8 Pages
