Exhibit 99

LOGO

275 West Federal Street

Youngstown, Ohio 44503-1203

FOR IMMEDIATE RELEASE

Media Contact:

Investor Contact:

Kathy Bushway

Senior Vice President, Marketing

Home Savings

(330) 742-0638

kbushway@homesavings.com

Gary M. Small

President and Chief Executive Officer

United Community Financial Corp.

(330) 742-0472

UCFC ANNOUNCES RECORD RESULTS FOR THE YEAR

NET INCOME $39.5 MILLION — $0.81 PER SHARE

OR $40.8 MILLION — $0.84 PER SHARE ADJUSTED FOR MERGER COSTS

Fourth quarter 2019 highlights compared with the fourth quarter of 2018:

•

Net quarterly income of $9.8 million (or $11.2 million, excluding merger related costs, up 17.0%)

•

Diluted EPS of $0.20 (or $0.23, excluding merger related costs, up 20.9%)

•

Noninterest income $6.8 million, up 22.6%

•

Noninterest expense $16.8 million (or $15.4 million, excluding merger costs, down 10.2%)

•

ROA of 1.36% (or 1.55%, excluding merger related costs, versus 1.36%)

•

ROE of 12.03% (or 13.68%, excluding merger related costs, versus 12.15%)

•

Efficiency ratio improved to 53.6% compared to 54.8%

Full year 2019 highlights compared with 2018:

•

Net income of $39.5 million (or $40.8 million, excluding merger related costs, up 9.8%)

•

Diluted EPS of $0.81 (or $0.84, excluding merger related costs, up 13.1%)

•

Noninterest income $26.6 million, up 13.7%

•

Noninterest expense $65.4 million (or $64.1 million, excluding merger costs, down 1.5%)

•

ROA of 1.38% (or 1.43%, excluding merger related costs, versus 1.35%)

•

ROE of 12.34% (or 12.77%, excluding merger related costs, versus 12.10%)

•

Efficiency ratio improved to 55.8% compared to 57.7%

•

Average total loan growth 5.4%

•

Average total customer deposit growth 7.5%

YOUNGSTOWN, Ohio (January 21, 2020) – United Community Financial Corp. (Company) (NASDAQ: UCFC), parent company of Home Savings Bank (Home Savings), announced today that net income for the quarter ended December 31, 2019, was $9.8 million, up 2.8% from the $9.6 million reported for the quarter ended December 31, 2018. Fourth quarter diluted earnings per share increased 6.3% to $0.20 from $0.19 per share reported at the same time last year. These results included $1.4 million of merger costs related to the previously announced merger with First Defiance Financial Corp. Excluding these acquisition costs, the Company’s adjusted net income (non-GAAP) was $11.2 million, up 17.0% and diluted earnings per share were $0.23 per share, up 20.9% for the quarter ending December 31, 2019 when compared to the same quarter last year.

Net income for the twelve months ended December 31, 2019 totaled $39.5 million, up 6.2% from the $37.2 million reported for the twelve months ended December 31, 2018. For the same time period, diluted earnings per share increased to $0.81, up 9.3% from the $0.74 per share previously reported in the prior year. Excluding the $1.4 million in merger costs (after-tax), adjusted net income (non-GAAP) for the twelve months ended December 31, 2019 was $40.8 million up 9.8%, or $0.84 per diluted share or 13.1% when compared to the prior year.

Gary M. Small, President and Chief Executive Officer of the Company, commented, “The year 2019 proved to be a challenging yet gratifying period for Home Savings. Our team took the steps necessary to overcome the difficulties presented by a tumultuous year for net interest margin management and a very active loan prepayment environment.”

Small continued, “The organization set record levels of commercial and residential new business production, delivered exceptional fee income growth across all business lines, and drove strong deposit growth. As a result we posted excellent financial results … our best earnings on record.”

Concluding, “I am very proud of the efforts of all of our associates. Thanks to their hard work, we remain right on track regarding our pending merger with First Defiance and we look forward to an exciting and successful 2020 with our new partners.”

Strong Loan and Deposit Growth

Total average loans grew $119.2 million (including loans held for sale), or 5.4%, during the last twelve months and $90.6 million, or 4.0% when compared to the same quarter last year. At December 31, 2019, total net loans (including loans held for sale) aggregated $2.4 billion.

The increase in total loans for the period was driven by an increase in commercial loans, which grew $51.4 million, or 5.5%, over the last twelve months. Mortgage loans (including loans held for sale) increased $14.7 million, or 1.4%, over the previous twelve months. Consumer loan growth amounted to $9.2 million, or 3.4%, for the same time period.

Average customer deposits (which exclude brokered certificates of deposit) increased $142.7 million, or 7.5%, from December 31, 2018. During that same time period total business deposits increased $69.1 million, or 26.6%. Average non-interest bearing accounts increased $43.9 million or 10.4% while average non-interest bearing business deposits increased $27.1 million or 13.4% during the same time period.

Net Interest Income and Margin

Net interest income totaled $21.8 million on a fully taxable equivalent (FTE) basis for the quarter ended December 31, 2019 compared to $23.6 million for the quarter ended December 31, 2018. The fourth quarter of 2018 included the impact of the favorable resolution of an impaired loan that added approximately $1.1 million to loan income during that quarter.

The net interest margin on an FTE basis was 3.22% for the fourth quarter of 2019 compared to 3.58% in the fourth quarter of 2018. Excluding the 16 basis point impact of the aforementioned resolution of an impaired loan, the net interest margin declined 20 basis points. Of this, 5 basis points were from reduced purchase accounting accretion, while the remainder of the decline reflects the near term impact of multiple rate reductions by the Federal Reserve in 2019.

For the full year 2019, the net interest margin was 3.28% compared to 3.43% for the full year 2018. Excluding the income impact of the loan resolution, calendar year 2018 net interest margin would have been 3.39%. Of the 11 basis point reduction 3 basis points were from reduced purchase accounting accretion, and the remaining 8 basis points of the decline can be attributed to the fall in interest rates in 2019.

Asset Quality Remains Strong

Asset quality remained strong during the fourth quarter despite movement in nonperforming loans. At December 31, 2019, nonperforming loans aggregated $12.9 million compared to $6.5 million at the end of the same quarter in the previous year. The Company’s level of nonperforming loans increased primarily as a result of a single credit. The allowance for loan losses at the end of the quarter, as a percent of nonperforming loans was 149.6%. The allowance for loan losses as a percent of loans totaled 0.86% at December 31, 2019 compared to 0.93% the same quarter last year.

The Company recognized a negative provision for loan losses of $422,000 for the fourth quarter of 2019, compared to a provision of $178,000 in the fourth quarter of 2018. The decline in provision is a result of decreased loan balances in the fourth quarter of 2019, quarterly realignment of factors and the resolution of one credit with a specific reserve. For the year, the provision totaled $290,000 compared to $699,000 the previous year. Net charge offs to average loans were 6.6 basis points for the year ended December 31, 2019.

Non-Interest Income

Non-interest income increased 22.6%, or $1.3 million to $6.9 million for the fourth quarter of 2019 compared to $5.6 million for the same quarter last year. The primary drivers for the increase are mortgage banking income (gain on sale) of $686,000 and an increase of $356,000 in the value of mortgage servicing rights along with a $260,000 improvement in security sales. These gains were offset by an increase in the amortization of mortgage servicing rights of $427,000.

The increase in mortgage banking income was primarily driven by increased saleable volumes when comparing the fourth quarter of 2019 to the fourth quarter of 2018. The drop in interest rates resulting in increased refinance activity is the primary driver for the increased volume.

For the full year 2019, non-interest income increased 13.7%, or $3.2 million to $26.6 million compared to $23.4 million for calendar year 2018. The primary reason for this is an increase in mortgage banking income (gain on sale) of $3.5 million along with increased mortgage servicing fees of $289,000. Also adding to the increase was $578,000 from improvement in security gains, along with an 11.6% increase in insurance income and 9.9% increase in investment management fees. This was offset by an increase in mortgage serving rights amortization of $608,000 and a negative mortgage servicing rights valuation adjustment of $1,457,000. The increase in mortgage banking income was primarily driven by an increase in saleable loan volumes of 24.1% and in increase in the gain on sale margin of 43 basis points.

Non-Interest Expense

Non-interest expense was $15.4 million (excluding merger costs) for the fourth quarter of 2019 compared to $17.2 million for the similar quarter last year, a decrease of $1.8 million, or 10.2%. The fourth quarter of 2018 includes a prepayment penalty of $937,000 for the early extinguishment of Federal Home Loan Bank debt. Excluding this expense non-interest expense was down 4.8%. Non-interest expense for the year was $64.1 million (excluding merger costs). When compared to the prior year of $65.1 million, expenses were down 1.5%. When excluding the Federal Home Loan Bank prepayment penalty expenses year over year remained flat. The Company’s efficiency ratio improved to 55.8% for the year versus 57.7% for the same time period a year ago.

Equity

During 2019, the Company repurchased 1,145,434 of its common shares in the open market at an average price of $9.36. Tangible book value per common share at December 31, 2019 was $6.41compared to $5.18 at December 31, 2018.

Dividend to be paid

Subject to the closing of the merger of United Community with and into First Defiance Financial Corp., which was announced on September 9, 2019, and is expected to close on January 31, 2020, it is anticipated that a dividend will be paid to all First Defiance shareholders, including UCFC’s shareholders whose shares will be converted to First Defiance common shares upon the closing of the merger. First Defiance declared a dividend of $0.22 per share payable on February 21, to shareholders of record as of February 14. This action would be the equivalent of UCFC paying a dividend of $0.08173 on UCFC shares.

Other

Home Savings is a wholly owned subsidiary of the Company, offering a full line of commercial, wealth management and consumer banking products and services with 33 retail banking offices (32 in Ohio and one in Pennsylvania). Home Savings also has residential mortgage loan centers servicing Ohio, West Virginia, western Pennsylvania, northern Kentucky, and eastern Indiana. Additional information on the Company, Home Savings and James & Sons Insurance may be found on the Company’s web site: ir.ucfconline.com.

###

When used in this press release, the words or phrases “believes,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project”, “will have”, “can expect” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties, including changes in economic conditions in the Company’s market area, changes in policies by regulatory agencies, fluctuations in interest rates, demand for loans in the Company’s market area, competition, and the ability to close the merger of the Company with and into First Defiance Financial Corp. that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. The Company cautions readers not to place undue reliance on any such

forward-looking statements, which speak only as of the date made. The Company advises readers that the factors listed above could affect the Company’s financial performance and could cause the Company’s actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements.

The Company does not undertake, and specifically disclaims any obligation, to release publicly the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

UNITED COMMUNITY FINANCIAL CORP.

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Unaudited)


	December 31,			December 31,
	2019			2018			F/(U)
	(Dollars in thousands)
Assets:
Cash and deposits with banks	$	30,218		$	34,380			-12.1	%
Federal funds sold		21,635			26,605			-18.7	%

Total cash and cash equivalents		51,853			60,985			-15.0	%
Securities:
Trading, at fair value		516			364			41.8	%
Available for sale, at fair value		306,786			241,643			27.0	%
Held to maturity (fair value of $0 and $75,075, respectively)		—			77,491			-100.0	%
Loans held for sale, at fair value		127,839			91,472			39.8	%
Gross loans		2,237,224			2,197,285			1.8	%
Allowance for loan losses		(19,281	)		(20,443	)		-5.7	%

Net loans		2,217,943			2,176,842			1.9	%
Federal Home Loan Bank stock, at cost		13,639			19,144			-28.8	%
Premises and equipment, net		22,337			21,930			1.9	%
Accrued interest receivable		8,660			9,080			-4.6	%
Real estate owned and other repossessed assets		816			1,088			-25.0	%
Goodwill		20,221			20,221			0.0	%
Core deposit intangible		1,275			1,603			-20.5	%
Customer list intangible		2,032			2,214			-8.2	%
Cash surrender value of life insurance		65,798			64,220			2.5	%
Other assets		28,598			23,060			24.0	%

Total assets	$	2,868,313		$	2,811,357			2.0	%

Liabilities and Shareholders’ Equity
Liabilities:
Deposits:
Interest bearing	$	1,665,042		$	1,528,057			9.0	%
Noninterest bearing		430,040			394,208			9.1	%

Customer deposits		2,095,082			1,922,265			9.0	%
Brokered deposits		192,027			290,955			-34.0	%

Total deposits		2,287,109			2,213,220			3.3	%
Borrowed funds:
Federal Home Loan Bank advances
Short-term advances		191,000			243,000			-21.4	%

Total Federal Home Loan Bank advances		191,000			243,000			-21.4	%
Repurchase agreements and other		—			224			-100.0	%

Total borrowed funds		191,000			243,224			-21.5	%
Advance payments by borrowers for taxes and insurance		31,650			27,192			16.4	%
Accrued interest payable		656			1,279			-48.7	%
Accrued expenses and other liabilities		25,789			17,108			50.7	%

Total liabilities		2,536,204			2,502,023			1.4	%

Shareholders’ Equity:
Preferred stock-no par value; 1,000,000 shares authorized and no shares outstanding		—			—			0.0	%
Common stock-no par value; 499,000,000 shares authorized; 54,138,910 shares issued and 48,104,055 and 49,128,875 shares, respectively, outstanding		177,392			177,492			-0.1	%
Retained earnings		216,868			192,062			12.9	%
Accumulated other comprehensive loss		(13,461	)		(21,436	)		-37.2	%
Treasury stock, at cost, 6,034,855 and 5,010,035 shares, respectively		(48,690	)		(38,784	)		25.5	%

Total shareholders’ equity		332,109			309,334			7.4	%

Total liabilities and shareholders’ equity	$	2,868,313		$	2,811,357			2.0	%

UNITED COMMUNITY FINANCIAL CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


	For the Three Months Ended																					For the Twelve Months Ended
	December 31,			September 30,									December 31,									December 31,			December 31,
	2019			2019			Variance			F/(U)			2018			Variance			F/(U)			2019			2018			Variance			F/(U)
	(Dollars in thousands, except per share data)
Interest income
Loans	$	25,501		$	26,037		$	(536	)		-2.1	%	$	26,587		$	(1,086	)		-4.1	%	$	103,768		$	96,653		$	7,115			7.4	%
Loans held for sale		1,219			1,067			152			14.2	%		1,184			35			3.0	%		4,284			4,318			(34	)		-0.8	%
Securities:
Available for sale, nontaxable		234			235			(1	)		-0.4	%		334			(100	)		-29.9	%		1,012			1,412			(400	)		-28.3	%
Available for sale, taxable		1,781			1,828			(47	)		-2.6	%		1,148			633			55.1	%		6,483			4,732			1,751			37.0	%
Held to maturity, nontaxable		—			—			—			0.0	%		69			(69	)		-100.0	%		99			250			(151	)		-60.4	%
Held to maturity, taxable		—			—			—			0.0	%		380			(380	)		-100.0	%		497			1,574			(1,077	)		-68.4	%
Federal Home Loan Bank stock dividends		140			173			(33	)		-19.1	%		290			(150	)		-51.7	%		847			1,133			(286	)		-25.2	%
Other interest earning assets		125			203			(78	)		-38.4	%		178			(53	)		-29.8	%		752			500			252			50.4	%

Total interest income		29,000			29,543			(543	)		-1.8	%		30,170			(1,170	)		-3.9	%		117,742			110,572			7,170			6.5	%
Interest expense
Deposits		6,095			6,856			(761	)		11.1	%		5,866			229			-3.9	%		26,722			17,796			8,926			-50.2	%
Federal Home Loan Bank advances		1,157			1,103			54			-4.9	%		810			347			-42.8	%		3,460			4,830			(1,370	)		28.4	%
Repurchase agreements and other		—			—			—			0.0	%		—			—			0.0	%		—			1			1			100.0	%

Total interest expense		7,252			7,959			707			-8.9	%		6,676			(576	)		8.6	%		30,182			22,627			(7,555	)		33.4	%

Net interest income		21,748			21,584			164			0.8	%		23,494			(1,746	)		-7.4	%		87,560			87,945			(385	)		-0.4	%
Taxable equivalent adjustment		51			46			5			10.9	%		111			(60	)		-54.1	%		244			382			(138	)		-36.1	%

Net interest income (FTE)⁽¹⁾		21,799			21,630			169			0.8	%		23,605			(1,806	)		-7.7	%		87,804			88,327			(523	)		-0.6	%
Provision for loan losses		(422	)		701			1,123			160.2	%		178			600			337.1	%		290			699			409			58.5	%

Net interest income after provision for loan losses (FTE)		22,221			20,929			1,292			6.2	%		23,427			(1,206	)		-5.1	%		87,514			87,628			(114	)		-0.1	%

Non-interest income
Insurance agency income		631			575			56			9.7	%		562			69			12.3	%		2,452			2,197			255			11.6	%
Brokerage income		383			480			(97	)		-20.2	%		305			78			25.6	%		1,642			1,216			426			35.0	%
Service fees and other charges:
Deposit related fees		1,515			1,490			25			1.7	%		1,521			(6	)		-0.4	%		5,762			5,706			56			1.0	%
Mortgage servicing fees		931			908			23			2.5	%		858			73			8.5	%		3,593			3,304			289			8.7	%
Mortgage servicing rights valuation		312			(336	)		648			-192.9	%		(44	)		356			-809.1	%		(1,518	)		(61	)		(1,457	)		-2388.5	%
Mortgage servicing rights amortization		(857	)		(702	)		(155	)		22.1	%		(430	)		(427	)		99.3	%		(2,557	)		(1,949	)		(608	)		-31.2	%
Other service fees		21			21			—			0.0	%		36			(15	)		-41.7	%		101			161			(60	)		-37.3	%
Net gains (losses):
Trading securities		68			29			39			134.5	%		669			(601	)		-89.8	%		200			669			(469	)		-70.1	%
Securities available for sale		—			128			(128	)		-100.0	%		(861	)		861			-100.0	%		420			(627	)		1,047			-167.0	%
Mortgage banking income		1,804			2,508			(704	)		-28.1	%		1,118			686			61.4	%		8,619			5,090			3,529			69.3	%
Real estate owned and other repossessed assets charges, net		4			(55	)		59			-107.3	%		(24	)		28			-116.7	%		(115	)		(260	)		145			55.8	%
Debit/credit card fees		1,039			1,057			(18	)		-1.7	%		1,033			6			0.6	%		4,251			4,158			93			2.2	%
Trust fee income		428			434			(6	)		-1.4	%		480			(52	)		-10.8	%		1,788			1,905			(117	)		-6.1	%
Bank owned life insurance		397			398			(1	)		-0.3	%		431			(34	)		-7.9	%		1,578			1,732			(154	)		-8.9	%
Other income		171			80			91			113.8	%		(69	)		240			-347.8	%		391			161			230			142.9	%

Total non-interest income		6,847			7,015			(168	)		-2.4	%		5,585			1,262			22.6	%		26,607			23,402			3,205			13.7	%

Non-interest expense
Salaries and employee benefits		9,278			8,831			447			-5.1	%		9,029			249			-2.8	%		37,790			37,071			719			-1.9	%
Occupancy		1,051			1,024			27			-2.6	%		1,023			28			-2.7	%		4,146			4,167			(21	)		0.5	%
Equipment and data processing		2,251			2,307			(56	)		2.4	%		2,122			129			-6.1	%		9,055			8,679			376			-4.3	%
Financial institutions tax		468			509			(41	)		8.1	%		464			4			-0.9	%		1,995			1,950			45			-2.3	%
Advertising		278			407			(129	)		31.7	%		414			(136	)		32.9	%		1,539			1,278			261			-20.4	%
Amortization of intangible assets		127			127			—			0.0	%		128			(1	)		0.8	%		510			501			9			-1.8	%
FDIC insurance premiums		211			(288	)		499			173.3	%		398			(187	)		47.0	%		551			1,270			(719	)		56.6	%
Other insurance premiums		74			74			—			0.0	%		70			4			-5.7	%		300			373			(73	)		19.6	%
Professional fees:
Legal fees		100			181			(81	)		44.8	%		292			(192	)		65.8	%		554			1,094			(540	)		49.4	%
Other professional fees		250			545			(295	)		54.1	%		721			(471	)		65.3	%		1,945			2,262			(317	)		14.0	%
Supervisory fees		48			48			—			0.0	%		34			14			-41.2	%		163			152			11			-7.2	%
Real estate owned and other repossessed asset expenses		27			39			(12	)		30.8	%		34			(7	)		20.6	%		123			129			(6	)		4.7	%
Acquisition related expenses		1,351			—			1,351			100.0	%		—			1,351			100.0	%		1,351			—			1,351			100.0	%
Other expenses		1,265			1,207			58			-4.8	%		2,449			(1,184	)		48.3	%		5,419			6,153			(734	)		11.9	%

Total non-interest expenses		16,779			15,011			(1,768	)		-11.8	%		17,178			399			-2.3	%		65,441			65,079			(362	)		0.6	%

Income before income taxes		12,289			12,933			(644	)		-5.0	%		11,834			455			3.8	%		48,680			45,951			2,729			5.9	%
Taxable equivalent adjustment		51			46			5			-10.9	%		111			(60	)		54.1	%		244			382			(138	)		36.1	%
Income tax expense		2,415			2,383			32			-1.3	%		2,172			243			-11.2	%		8,967			8,391			576			-6.9	%

Net income	$	9,823		$	10,504		$	(681	)		-6.5	%	$	9,551		$	272			2.8	%	$	39,469		$	37,178		$	2,291			6.2	%

Earnings per common share:
Basic	$	0.204		$	0.218		$	(0.014	)		-6.4	%	$	0.192		$	0.012			6.2	%	$	0.815		$	0.746		$	0.069			9.2	%
Diluted		0.203			0.218			(0.015	)		-6.9	%		0.191			0.012			6.3	%		0.811			0.742			0.069			9.3	%

Diluted earnings per share excluding merger cost		0.231			0.218			0.013			6.0	%		0.191			0.040			20.9	%		0.839			0.742			0.097			13.1	%

⁽¹⁾

Net interest income is also presented on a fully taxable equivalent (FTE) basis, the Company believes this non-GAAP measure is the preferred industry measurement for this item.

UNITED COMMUNITY FINANCIAL CORP.

CONSOLIDATED AVERAGE BALANCES

(Unaudited)


	For the three months ended
	December 31, 2019							September 30, 2019							December 31, 2018
	Average		Interest					Average		Interest					Average		Interest
	outstanding		earned/		Yield/			outstanding		earned/		Yield/			outstanding		earned/		Yield/
	balance		paid		rate			balance		paid		rate			balance		paid		rate
	(Dollars in thousands)
Interest earning assets:
Net loans ⁽¹⁾	$	2,233,356	$	25,508		4.55	%	$	2,224,310	$	26,045		4.66	%	$	2,161,414	$	26,616		4.93	%
Loans held for sale		119,043		1,219		4.10	%		99,581		1,067		4.29	%		100,348		1,184		4.68	%

Total loans, net		2,352,399		26,727		4.55	%		2,323,891		27,112		4.66	%		2,261,762		27,800		4.91	%
Securities:
Trading		—		—		0.00	%		—		—		0.00	%		4		—		0.00	%
Available for sale-taxable		271,592		1,781		2.62	%		279,618		1,828		2.61	%		196,910		1,148		2.33	%
Available for sale-nontaxable ⁽²⁾		34,968		278		3.18	%		35,054		273		3.12	%		48,370		399		3.30	%
Held to maturity-taxable		—		—		0.00	%		—		—		0.00	%		65,605		380		2.32	%
Held to maturity-nontaxable ⁽²⁾		—		—		0.00	%		—		—		0.00	%		12,215		86		2.82	%

Total securities		306,560		2,059		2.69	%		314,672		2,101		2.67	%		323,104		2,013		2.49	%
Federal Home Loan Bank stock		13,639		140		4.11	%		13,872		173		4.99	%		19,144		290		6.06	%
Other interest earning assets		26,414		125		1.88	%		36,706		203		2.19	%		34,779		178		2.03	%

Total interest earning assets		2,699,012		29,051		4.29	%		2,689,141		29,589		4.38	%		2,638,789		30,281		4.59	%
Non-interest earning assets		180,691							181,208							176,579

Total assets	$	2,879,703						$	2,870,349						$	2,815,368

Interest bearing liabilities:
Deposits:
Checking accounts	$	807,682		2,440		1.21	%	$	770,268		2,391		1.24	%	$	620,306		1,114		0.71	%
Savings accounts		285,478		26		0.04	%		286,794		27		0.04	%		303,247		28		0.04	%
Certificates of deposit
Customer certificates of deposit		580,701		2,965		2.04	%		611,736		3,148		2.06	%		619,208		2,652		1.70	%
Brokered certificates of deposit		144,337		664		1.84	%		226,951		1,290		2.27	%		393,778		2,072		2.09	%

Total certificates of deposit		725,038		3,629		2.00	%		838,687		4,438		2.12	%		1,012,986		4,724		1.85	%

Total interest bearing deposits		1,818,198		6,095		1.34	%		1,895,749		6,856		1.45	%		1,936,539		5,866		1.20	%
Federal Home Loan Bank advances
Long-term advances		—		—		0.00	%		—		—		0.00	%		46,879		357		3.02	%
Short-term advances		245,250		1,157		1.89	%		189,370		1,103		2.33	%		75,033		453		2.40	%

Total Federal Home Loan Bank advances		245,250		1,157		1.89	%		189,370		1,103		2.33	%		121,912		810		2.64	%
Repurchase agreements and other		—		—		0.00	%		125		—		0.00	%		245		—		0.00	%

Total borrowed funds		245,250		1,157		1.89	%		189,495		1,103		2.33	%		122,157		810		2.63	%

Total interest bearing liabilities	$	2,063,448		7,252		1.41	%	$	2,085,244		7,959		1.53	%	$	2,058,696		6,676		1.29	%

Non-interest bearing liabilities
Total noninterest bearing deposits		433,275							411,106							395,649
Other noninterest bearing liabilities		56,267							54,197							46,559

Total noninterest bearing liabilities		489,542							465,303							442,208

Total liabilities	$	2,552,990						$	2,550,547						$	2,500,904
Shareholders’ equity		326,713							319,802							314,464

Total liabilities and equity	$	2,879,703						$	2,870,349						$	2,815,368

Net interest income and interest rate spread			$	21,799		3.00	%			$	21,630		2.85	%			$	23,605		3.30	%

Net interest margin						3.22	%						3.21	%						3.58	%
Average interest earning assets to average interest bearing liabilities						130.80	%						128.96	%						128.18	%

Interest bearing deposits
Checking accounts	$	807,682	$	2,440		1.21	%	$	770,268	$	2,391		1.24	%	$	620,306	$	1,114		0.71	%
Savings accounts		285,478		26		0.04	%		286,794		27		0.04	%		303,247		28		0.04	%
Customer certificates of deposit		580,701		2,965		2.04	%		611,736		3,148		2.06	%		619,208		2,652		1.70	%

Total customer deposits		1,673,861		5,431		1.30	%		1,668,798		5,566		1.33	%		1,542,761		3,794		0.98	%
Brokered certificates of deposit		144,337		664		1.84	%		226,951		1,290		2.27	%		393,778		2,072		2.09	%

Total interest bearing deposits		1,818,198		6,095		1.34	%		1,895,749		6,856		1.45	%		1,936,539		5,866		1.20	%
Noninterest bearing deposits		433,275		—		0.00	%		411,106		—		0.00	%		395,649		—		0.00	%

Total average deposits and cost of deposits	$	2,251,473	$	6,095		1.08	%	$	2,306,855	$	6,856		1.19	%	$	2,332,188	$	5,866		1.01	%
Other interest bearing liabilities
Federal Home Loan Bank advances
Long term advances	$	—	$	—		0.00	%	$	—	$	—		0.00	%	$	46,879	$	357		3.02	%
Short term advances		245,250		1,157		1.89	%		189,370		1,103		2.33	%		75,033		453		2.40	%

Total Federal Home Loan Bank advances		245,250		1,157		1.89	%		189,370		1,103		2.33	%		121,912		810		2.64	%
Repurchase agreements and other		—		—		0.00	%		125		—		0.00	%		245		—		0.00	%

Total borrowed funds		245,250		1,157		1.89	%		189,495		1,103		2.33	%		122,157		810		2.63	%

Total average deposits and other interest bearing liabilities and total cost of funds	$	2,496,723	$	7,252		1.26	%	$	2,496,350	$	7,959		1.26	%	$	2,454,345	$	6,676		1.09	%

Customer deposits interest bearing and noninterest bearing	$	2,107,136	$	5,431		1.03	%	$	2,079,904	$	5,566		1.07	%	$	1,938,410	$	3,794		0.78	%
Brokered deposits		144,337		664		1.84	%		226,951		1,290		2.27	%		393,778		2,072		2.09	%
Total borrowings		245,250		1,157		1.89	%		189,495		1,103		2.33	%		122,157		810		2.63	%
Cost of funds		2,496,723		7,252		1.26	%		2,496,350		7,959		1.26	%		2,454,345		6,676		1.09	%

⁽¹⁾	Nonaccrual loans are included in the average balance at a yield of 0%.

⁽²⁾	Yields are on a fully taxable equivalent basis.

UNITED COMMUNITY FINANCIAL CORP.

SELECTED FINANCIAL HIGHLIGHTS

(Unaudited)


	At or for the quarters ended
	December 31, 2019			September 30, 2019			June 30, 2019			March 31, 2019			December 31, 2018
	(Dollars in thousands, except per share data)
Financial Data
Total assets	$	2,868,313		$	2,906,573		$	2,869,116		$	2,852,041		$	2,811,357
Total loans, net		2,217,943			2,248,507			2,229,326			2,215,549			2,176,842
Total securities		307,302			315,755			319,714			313,847			319,498
Total deposits		2,287,109			2,105,758			2,259,179			2,289,803			2,213,220
Average interest-bearing deposits		1,818,198			1,895,749			1,973,104			1,963,567			1,936,539
Average noninterest-bearing deposits		433,275			411,106			405,535			400,874			395,649
Total shareholders’ equity		332,109			326,856			317,554			314,709			309,334
Net interest income		21,748			21,584			22,043			22,186			23,494
Net interest income (FTE)⁽¹⁾		21,799			21,630			22,105			22,270			23,605
Provision for loan losses		(422	)		701			(51	)		61			178
Noninterest income		6,847			7,015			6,671			6,073			5,585
Noninterest expense		16,779			15,011			15,976			17,674			17,178
Income tax expense		2,415			2,383			2,303			1,868			2,172
Net income		9,823			10,504			10,486			8,656			9,551

Share Data
Basic earnings per common share	$	0.204		$	0.218		$	0.216		$	0.177		$	0.192
Diluted earnings per common share		0.203			0.218			0.215			0.176			0.191
Book value per common share		6.90			6.80			6.61			6.44			6.30
Tangible book value per common share		6.41			6.31			6.11			5.95			5.81
Market value per common share		11.66			10.78			9.57			9.35			8.85

Common shares outstanding at end of period		48,104			48,087			48,069			48,853			49,129
Weighted average shares outstanding—basic		47,996			47,961			48,463			48,854			49,445
Weighted average shares outstanding—diluted		48,221			48,164			48,644			49,113			49,695

Key Ratios
Return on average assets ⁽²⁾		1.36	%		1.46	%		1.48	%		1.22	%		1.36	%
Return on average assets excluding merger cost		1.55	%		1.46	%		1.48	%		1.22	%		1.36	%
Return on average equity ⁽³⁾		12.03	%		13.14	%		13.22	%		10.99	%		12.15	%
Return on average equity excluding merger cost		13.68	%		13.14	%		13.22	%		10.99	%		12.15	%
Return on tangible equity ⁽⁴⁾		12.96	%		14.19	%		14.30	%		11.90	%		13.16	%
Return on tangible equity excluding merger cost		14.75	%		14.19	%		14.30	%		11.90	%		13.16	%
Net interest margin		3.22	%		3.21	%		3.33	%		3.38	%		3.58	%
Efficiency ratio		53.55	%		52.15	%		55.37	%		62.29	%		54.79	%
Nonperforming loans to net loans, end of period		0.58	%		0.46	%		0.58	%		0.32	%		0.30	%
Nonperforming assets to total assets, end of period		0.48	%		0.39	%		0.48	%		0.34	%		0.27	%
Allowance for loan loss as a percent of loans, end of period		0.86	%		0.88	%		0.91	%		0.91	%		0.93	%
Delinquent loans to total net loans, end of period		0.74	%		0.63	%		0.58	%		0.41	%		0.50	%

⁽¹⁾	Net interest income is presented on a fully taxable equivalent (FTE) basis, the Company believes this non-GAAP measure is the preferred industry measurement for this item

⁽²⁾	Net income divided by average total assets

⁽³⁾	Net income divided by average total equity

⁽⁴⁾	Net income divided by average total equity, minus average intangible assets

UNITED COMMUNITY FINANCIAL CORP.

SELECTED FINANCIAL HIGHLIGHTS

(Unaudited)


	At or for the quarters ended
	December 31, 2019			September 30, 2019			June 30, 2019			March 31, 2019			December 31, 2018
	(Dollars in thousands)
Loan Portfolio Composition
Commercial loans
Multi-family	$	177,363		$	166,027		$	154,630		$	163,243		$	134,143
Owner/nonowner occupied commercial real estate		401,600			409,687			414,780			412,550			409,979
Land		18,131			19,653			16,955			17,090			16,830
Construction		122,102			127,388			138,043			135,048			141,686
Commercial and industrial		275,179			271,292			249,898			246,740			240,293

Total		994,375			994,047			974,306			974,671			942,931
Residential mortgage loans
Real estate		914,073			938,899			942,698			934,586			927,255
Construction		34,931			44,636			46,196			45,102			43,435

Total		949,004			983,535			988,894			979,688			970,690
Consumer loans
Consumer		286,329			283,641			279,531			274,998			277,041

Total		286,329			283,641			279,531			274,998			277,041

Total loans		2,229,708			2,261,223			2,242,731			2,229,357			2,190,662
Less:
Allowance for loan losses		19,281			19,987			20,482			20,446			20,443
Deferred loan costs, net		(7,517	)		(7,271	)		(7,077	)		(6,638	)		(6,623	)

Total		11,764			12,716			13,405			13,808			13,820

Total loans, net		2,217,944			2,248,507			2,229,326			2,215,549			2,176,842
Loans held for sale, net		127,839			113,593			97,477			77,676			91,472

Total loans	$	2,345,783		$	2,362,100		$	2,326,803		$	2,293,225		$	2,268,314


	At or for the quarters ended
	December 31, 2019			September 30, 2019			June 30, 2019			March 31, 2019			December 31, 2018
	(Dollars in thousands)
Deposit Portfolio Composition
Checking accounts
Interest bearing checking accounts	$	137,783		$	134,662		$	131,725		$	146,244		$	146,977
Non-interest bearing checking accounts		430,040			421,631			398,340			404,644			394,208

Total checking accounts		567,823			556,293			530,065			550,888			541,185
Savings accounts		284,745			286,251			290,354			297,186			298,087
Money market accounts		681,518			653,926			606,661			550,049			466,167

Total non-time deposits		1,534,086			1,496,470			1,427,080			1,398,123			1,305,439
Certificates of deposit		560,996			591,516			644,024			630,174			616,826

Total customer deposits		2,095,082			2,087,986			2,071,104			2,028,297			1,922,265
Brokered deposits		192,027			17,772			188,075			261,506			290,955

Total certificates of deposit		753,023			609,288			832,099			891,680			907,781

Total deposits	$	2,287,109		$	2,105,758		$	2,259,179		$	2,289,803		$	2,213,220

UNITED COMMUNITY FINANCIAL CORP.

SELECTED FINANCIAL HIGHLIGHTS

(Unaudited)


	At or for the quarters ended
	December 31, 2019			September 30, 2019			June 30, 2019			March 31, 2019			December 31, 2018
	(Dollars in thousands)
Allowance For Loan Losses
Beginning balance	$	19,987		$	20,482		$	20,446		$	20,443		$	21,332
Provision		(422	)		701			(51	)		61			178
Net (chargeoffs) recoveries		(284	)		(1,196	)		87			(58	)		(1,067	)

Ending balance	$	19,281		$	19,987		$	20,482		$	20,446		$	20,443


	At or for the quarters ended
	December 31, 2019			September 30, 2019			June 30, 2019			March 31, 2019			December 31, 2018
	(Dollars in thousands)
Net (Charge-offs) Recoveries
Commercial loans
Multi-family	$	13		$	4		$	4		$	113		$	(99	)
Owner/nonowner occupied commercial real estate		14			12			165			28			38
Land		—			—			—			—			—
Construction		1			—			—			1			—
Commercial and industrial		(155	)		(897	)		1			(84	)		(765	)

Total		(127	)		(881	)		170			58			(826	)
Residential mortgage loans
Real estate		(55	)		(186	)		(53	)		78			(131	)
Construction		—			—			—			—			—

Total		(55	)		(186	)		(53	)		78			(131	)
Consumer loans
Consumer		(102	)		(130	)		(30	)		(194	)		(110	)

Total		(102	)		(130	)		(30	)		(194	)		(110	)

Total net (charge-offs) Recoveries	$	(284	)	$	(1,197	)	$	87		$	(58	)	$	(1,067	)


	At or for the quarters ended
	December 31, 2019			September 30, 2019			June 30, 2019			March 31, 2019			December 31, 2018
	(Dollars in thousands)
Nonperforming Loans
Commercial loans
Multi-family	$	—		$	—		$	—		$	—		$	171
Owner/nonowner occupied commercial real estate		6,222			3,610			2,688			1,565			13
Land		—			—			—			—			—
Construction		—			—			—			—			—
Commercial and industrial		525			785			4,678			456			531

Total		6,747			4,395			7,366			2,021			715
Residential mortgage loans
Real estate		4,275			4,233			4,365			3,883			4,170
Construction		—			—			—			—			—

Total		4,275			4,233			4,365			3,883			4,170
Consumer loans
Consumer		1,868			1,689			1,141			1,203			1,654

Total		1,868			1,689			1,141			1,203			1,654

Total nonperforming loans	$	12,890		$	10,317		$	12,872		$	7,107		$	6,539

Total Nonperforming Loans and Nonperforming Assets
Past due 90 days and on nonaccrual status	$	7,279		$	7,107		$	5,392		$	4,351		$	5,750
Past due 90 days and still accruing		—			—			—			—			—

Past due 90 days		7,279			7,107			5,392			4,351			5,750
Past due less than 90 days and on nonaccrual		5,611			3,210			7,480			2,756			789

Total nonperforming loans		12,890			10,317			12,872			7,107			6,539
Other real estate owned		754			880			871			1,143			1,049
Other classified assets		—			—			—			1,479			—
Repossessed assets		62			82			84			37			39

Total nonperforming assets	$	13,706		$	11,279		$	13,827		$	9,766		$	7,627

UNITED COMMUNITY FINANCIAL CORP.

NON-GAAP DISCLOSURE RECONCILIATION

(Unaudited)


	As Reported Three months ended December 31, 2019			Merger related costs		Non-GAAP Proforma Three months ended December 31, 2019			As Reported Twelve months ended December 31, 2019			Merger related costs		Non-GAAP Proforma Twelve months ended December 31, 2019
	(In thousands, except per share data)
Net income:	$	9,823		$	1,351	$	11,174		$	39,469			1,351	$	40,820

Diluted EPS:
Net income	$	9,823		$	1,351	$	11,174			39,469					40,820
Net income allocated to participating securities		(23	)				(23	)		(8	)				(8	)

Net income available to common shareholders	$	9,800				$	11,151			39,461					40,812

Weighted average shares outstanding: diluted		48,220,742					48,220,742			48,501,575					48,501,575
Diluted EPS:	$	0.203				$	0.231		$	0.814				$	0.841

Net income	$	9,823		$	1,351	$	11,174		$	39,469		$	1,351	$	40,820
Average assets		2,879,703					2,879,703			2,854,554					2,854,554
Average equity		326,713					326,713			319,729					319,729
ROA:		1.36	%				1.55	%		1.38	%				1.43	%

ROE:		12.03	%				13.68	%		12.34	%				12.77	%

Efficiency Ratio:
Noninterest Expense	$	16,779		$	1,351	$	15,428		$	65,441		$	1,351	$	64,090
Intangible asset amortization		(127	)				(127	)		(510	)				(510	)
Net interest income		21,799					21,799			87,804					87,804
Noninterest income		6,847					6,847			26,606					26,606
Loss on securities		(68	)				(68	)		(620	)				(620	)
Loss on real estated owned		(4	)				(4	)		115					115
Efficiency Ratio:		58.28	%				53.55	%		57.00	%				55.82	%

Reconciliation of Average Shareholders’ Equity to Average Tangible Equity:


	At or for the quarters ended
	December 31, 2019			September 30, 2019			June 30, 2019			March 31, 2019			December 31, 2018
	(Dollars in thousands, except per share data)
Average shareholders equity	$	326,713		$	319,802		$	317,265		$	315,006		$	314,464
Average intangible assets		23,612			23,740			23,867			23,994			24,123

Average tangible equity	$	303,101		$	296,062		$	293,398		$	291,012		$	290,341

Net income	$	9,823		$	10,504		$	10,486		$	8,656		$	9,551

Merger cost		1,351			—			—			—			—

Net income without merger cost	$	11,174		$	10,504		$	10,486		$	8,656		$	9,551

Return on tangible equity		12.96	%		14.19	%		14.30	%		11.90	%		13.16	%

Return on tangible equity without merger cost		14.75	%		14.19	%		14.30	%		11.90	%		13.16	%

Reconciliation of Fully Taxable Equivalent Net Interest Income to Net Interest Income:


	For the quarters ended
	December 31, 2019		September 30, 2019		June 30, 2019		March 31, 2019		December 31, 2018
	(Dollars in thousands)
Interest income	$	29,000	$	29,543	$	29,799	$	29,401	$	30,170
Fully taxable equivalent adjustment		51		46		62		84		111

Fully taxable equivalent interest income		29,051		29,589		29,861		29,485		30,281
Interest expense		7,252		7,959		7,756		7,215		6,676

Fully taxable net interest income	$	21,799	$	21,630	$	22,105	$	22,270	$	23,605

Tangible Book Value Per Share:

Tangible book value, per share is defined at shareholders equity minus intangible assets divided by the number of shares outstanding.


	At the quarters ended
	December 31, 2019		September 30, 2019		June 30, 2019		March 31, 2019		December 31, 2018
	(Dollars in thousands, except per share data)
Total shareholders’ equity	$	332,109	$	326,856	$	317,554	$	314,709	$	309,334
Goodwill		20,221		20,221		20,221		20,221		20,221
Customer list intangible		2,032		2,078		2,123		2,169		2,214
Core deposit intangible		1,275		1,357		1,439		1,521		1,603
Total common shares outstanding		48,104,055		48,087,430		48,068,790		48,852,688		49,128,875
Tangible book value, as reported	$	6.41	$	6.31	$	6.11	$	5.95	$	5.81

Reconciliation of Net Interest Margin, Non-Interest Income and Non-Interest Expense:


	At the quarters ended						At the quarters ended
	December 31, 2019			December 31, 2018			September 30, 2019			September 30, 2018
Net interest income (FTE)	$	21,799		$	23,605		$	21,630		$	21,707
less: purchase accounting		(422	)		(178	)		(213	)		(383	)

Adjusted net interest income		21,377			23,427			21,417			21,324
Average earning assets		2,699,012			2,638,789			2,689,141			2,609,310
Net interest margin excluding purchase accounting		3.16	%		3.55	%		3.18	%		3.27	%

Non-interest income	$	6,847		$	5,585		$	7,015		$	6,146
less: mortgage servicing valuation adjustment		(312	)		44			336			6

Non-interest income, adjusted		6,535			5,629			7,351			6,152
Non-interest income % increase		16.1	%					19.5	%

Non-interest expense	$	16,779		$	17,178		$	15,011		$	15,772
Non-interest expense % decrease		-2.3	%					-4.8	%

UNITED COMMUNITY FINANCIAL CORP 8-K