<PAGE>   1
                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, DC  20549

                                   FORM 10-Q


[X]           QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                   OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended                  JUNE  30, 1997

[ ]           TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                   OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from       N/A                 to             N/A
                                  ---------------------------------------------

Commission File Number:                0-16540
                                       -------



                              UNITED BANCORP, INC.
            -------------------------------------------------------
            (Exact name of registrant as specified in its charter.)

           OHIO                                             34-1405357
---------------------------------                       -------------------
(State or other jurisdiction                              (IRS Employer
of incorporation or organization)                       Identification No.)



              FOURTH AT HICKORY STREET, MARTINS FERRY, OHIO  43935
              ----------------------------------------------------
              (Address of principal executive offices)  (Zip Code)

                                 (614) 633-0445
                                 --------------
              (Registrant's telephone number, including area code)

                                 NOT APPLICABLE
                                 --------------
(Former name, former address and former fiscal year, if changed since last
report)

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes X  No
                                              ---    ---

     Indicate the number of shares outstanding of the issuer's classes of
common stock as of the latest practicable date.

      COMMON STOCK, $1.00 PAR VALUE 2,035,035 SHARES AS OF AUGUST 4, 1997





<PAGE>   2
                              UNITED BANCORP, INC.
                               TABLE OF CONTENTS
                                   FORM 10-Q

<TABLE>
<S>                                                                                 <C>
PART I  FINANCIAL INFORMATION

 ITEM 1. Financial Statements (Unaudited)
   Condensed Consolidated Balance Sheets . . . June 30, 1997 and December 31, 1996......  3

   Condensed Consolidated Statements of Income . . . Three and Six Months Ended
   June 30, 1997 and 1996 ..............................................................  4

   Condensed Consolidated Statements of Cash Flows . . . Six Months Ended
   June 30, 1997 and 1996 ..............................................................  5

   Notes to Condensed Consolidated Financial Statements ............................ 6 - 17

 ITEM 2  Management's Discussion and Analysis of Financial Condition
   and Results of Operations ...................................................... 18 - 24

PART II  OTHER INFORMATION

 ITEM 1.
   Legal Proceedings ................................................................... 25

 ITEM 2.
   Changes in Securities ............................................................... 25

 ITEM 3.
   Default Upon Senior Securities ...................................................... 25

 ITEM 4.
   Submission of Matters to a Vote of Security Holders ................................. 25

 ITEM 5.
   Other Information ................................................................... 25

 ITEM 6.
   Exhibits and Reports on Form 8-K .................................................... 25

   Signatures .......................................................................... 26
</TABLE>









                                       2


<PAGE>   3
                              UNITED BANCORP, INC.
               CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
                            FORM 10-Q (IN THOUSANDS)


PART I  FINANCIAL INFORMATION

<TABLE>
<CAPTION>
                                                                                  JUNE 30,              DECEMBER 31,
                                                                                    1997                    1996
                                                                                ------------            ------------
<S>                                                                             <C>                     <C>
ASSETS                  
Cash and due from banks                                                         $      6,688            $      6,394 
Federal funds sold                                                                         -                     225 
                                                                                ------------            ------------
  Total cash and cash equivalents                                                      6,688                   6,619 
Securities available for sale                                                         28,070                  28,064 
Securities held to maturity                     
(Estimated fair value of $30,104 at 06/30/97 and $30,252 at 12/31/96)                 29,486                  29,794 
Loans receivable                        
  Commercial loans                                                                    14,579                  12,415 
  Commercial real estate loans                                                        41,720                  41,213 
  Real estate loans                                                                   32,917                  33,886 
  Installment loans                                                                   46,631                  45,147 
                                                                                ------------            ------------
    Total loans receivable                                                           135,847                 132,661 
Allowance for loan losses                                                             (2,187)                 (2,023)
                                                                                ------------            ------------
    Net loans receivable                                                             133,660                 130,638 
Premises and equipment, net                                                            5,274                   5,185 
Accrued interest receivable and other assets                                           2,460                   2,065 
                                                                                ------------            ------------
  Total Assets                                                                  $    205,638            $    202,365 
                                                                                ============            ============
                        
LIABILITIES                     
Demand deposits                 
  Noninterest bearing                                                           $     12,450            $     13,384 
  Interest bearing                                                                    25,798                  26,815 
Savings deposits                                                                      51,050                  49,882 
Time deposits - under $100,000                                                        67,587                  67,491 
Time deposits - $100,000 and over                                                     14,202                  13,940 
                                                                                ------------            ------------
    Total deposits                                                                   171,087                 171,512 
Securities sold under agreements to repurchase                                         8,133                   8,642 
Other borrowed funds                                                                   3,959                     704 
Accrued expenses and other liabilities                                                 1,472                   1,491 
                                                                                ------------            ------------
    Total Liabilities                                                                184,651                 182,349 
                        
SHAREHOLDERS' EQUITY                    
Common stock - $1 Par Value: 10,000,000 shares authorized;                      
  2,035,035 - 06/30/97 and 2,033,385 - 12/31/96 issued and outstanding                 2,035                   2,033 
Additional-paid-in-capital                                                            11,749                  11,726 
Retained earnings                                                                      7,039                   6,115 
Unrealized gain on securities available for sale, net of tax                             164                     142 
                                                                                ------------            ------------
  Total Shareholders' Equity                                                          20,987                  20,016 
                                                                                ------------            ------------
  Total Liabilities and Shareholders' Equity                                    $    205,638            $    202,365 
                                                                                ============            ============
</TABLE>




   SEE ACCOMPANYING NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.

                                       3
<PAGE>   4
                              UNITED BANCORP, INC.
            CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
                            FORM 10-Q (IN THOUSANDS)


<TABLE>
<CAPTION>
                                                           THREE MONTHS ENDED               SIX MONTHS ENDED            
                                                                 JUNE 30                         JUNE 30                
                                                           1997           1996             1997           1996
                                                        -------------------------       -------------------------
<S>                                                     <C>             <C>             <C>             <C>
Interest and dividend income                                                    
  Loans, including fees                                 $   3,101       $   2,808       $   6,105       $   5,593 
  Taxable securities                                          590             562           1,175           1,165 
  Non-taxable securities                                      278             266             555             512 
  Other interest and dividend income                           35              66              56              92 
                                                        ---------       ---------       ---------       ---------
      Total interest and dividend income                    4,004           3,702           7,891           7,362 
                                                        
Interest expense                                                        
  Deposits                                                      
    Demand                                                    172             162             330             315 
    Savings                                                   394             384             767             751 
    Time                                                    1,126           1,019           2,231           2,046 
  Other borrowed funds                                        116              81             226             167 
                                                        ---------       ---------       ---------       ---------
      Total interest expense                                1,808           1,646           3,554           3,279 
                                                        
NET INTEREST INCOME                                         2,196           2,056           4,337           4,083 
                                                        
Provision for loan losses                                    (111)           (122)           (222)           (233)
                                                        ---------       ---------       ---------       ---------
                                                        
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES         2,085           1,934           4,115           3,850 
                                                        
Noninterest income                                                      
  Service charges on deposit accounts                         148             158             286             301 
  Security gains - net                                          -              27               -              27 
  Other income                                                 63              58             163             157 
                                                        ---------       ---------       ---------       ---------
      Total noninterest income                                211             243             449             485 
                                                        
Noninterest expense                                                     
  Salaries and employee benefits                              718             668           1,416           1,351 
  Occupancy                                                   146             148             303             283 
  Other expenses                                              527             507           1,046             978 
                                                        ---------       ---------       ---------       ---------
      Total noninterest expense                             1,391           1,323           2,765           2,612 
                                                        
INCOME BEFORE INCOME TAXES                                    905             854           1,799           1,723 
  Income tax expense                                          212             196             428             418 
                                                        ---------       ---------       ---------       ---------
NET INCOME                                              $     693       $     658       $   1,371       $   1,305 
                                                        =========       =========       =========       =========

Earnings per common share                               $    0.34       $    0.32       $    0.67       $    0.64 
Weighted average shares outstanding                         2,034           2,033           2,034           2,033 
Dividends per common share                              $    0.11       $    0.11       $    0.22       $    0.21 

</TABLE>
                                                        


   SEE ACCOMPANYING NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.

                                       4
<PAGE>   5
                              UNITED BANCORP, INC.
          CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                            FORM 10-Q (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                            SIX MONTHS ENDED                
                                                                                JUNE 30,                
                                                                           1997           1996
                                                                        -------------------------
<S>                                                                     <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES                    
Net income                                                              $   1,371       $   1,305 
Adjustments to reconcile net income to net cash                 
    from operating activities                   
      Depreciation and amortization                                           229             214 
      Amortization of intangibles                                              33              42 
      Provision for loan losses                                               222             233 
      Deferred taxes                                                          (37)             26 
      Federal Home Loan Bank stock dividend                                   (22)            (11)
      Gain on sale/call of securities                                           -             (27)
      (Accretion)/amortization of securities, net                              (7)              5 
      Gain on sale of other real estate owned                                  (5)              - 
      Net changes in accrued interest receivable and other assets            (428)           (302)
      Net changes in accrued expenses and other liabilities                     6            (183)
                                                                        ---------       ---------
      Net cash from operating activities                                    1,362           1,302 
                        
CASH FLOWS FROM INVESTING ACTIVITIES                    
Securities available for sale                   
  Proceeds from sales                                                           -           3,015 
  Proceeds from maturities/calls                                            5,502           8,250 
  Purchases                                                                (5,424)         (8,120)
Securities held to maturity                     
  Proceeds from maturities/calls                                              681           2,806 
  Purchases                                                                  (393)         (4,406)
Net change in loans                                                        (3,269)         (3,479)
Net purchases of premises and equipment                                      (318)           (645)
Proceeds from sale of other real estate owned                                  30               - 
                                                                        ---------       ---------
      Net cash from investing activities                                   (3,191)         (2,579)
                        
CASH FLOWS FROM FINANCING ACTIVITIES                    
Net change in deposits                                                       (425)           (236)
Net change in short-term borrowings                                         2,308           1,190 
Proceeds from long-term debt                                                  465               - 
Principal payments on long-term debt                                          (28)              - 
Proceeds from exercise of stock options                                        23               - 
Tax benefit from exercise of stock options                                      2               - 
Cash dividends paid                                                          (447)           (429)
                                                                        ---------       ---------
      Net cash from financing activities                                    1,898             525 
                                                                        ---------       ---------
                        
Net change in cash and cash equivalents                                        69            (752)
                        
Cash and cash equivalents at beginning of year                              6,619           6,982 
                                                                        ---------       ---------
Cash and cash equivalents at end of period                              $   6,688       $   6,230 
                                                                        =========       =========
</TABLE>




   SEE ACCOMPANYING NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.

                                       5
<PAGE>   6

                              UNITED BANCORP, INC.
      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                   FORM 10-Q


1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

          These interim financial statements are prepared without audit and
     reflect all adjustments which, in the opinion of management, are necessary
     to present fairly the consolidated financial position of the Company at
     June 30, 1997 and its results of operations and statements of cash flows
     for the periods presented.  These adjustments are of a normal and
     recurring nature.  The accompanying condensed consolidated financial
     statements do not purport to contain all the necessary financial
     disclosures required by generally accepted accounting principles that
     might otherwise be necessary in the circumstances and should be read in
     conjunction with the 1996 United Bancorp, Inc. consolidated financial
     statements and related notes thereto included in its Annual Report To
     Shareholders for the year ended December 31, 1996.

     PRINCIPLES OF CONSOLIDATION:

          The consolidated financial statements include the accounts of United
     Bancorp, Inc. (Company) and its wholly owned subsidiaries, (Banks) The
     Citizens Savings Bank, Martins Ferry, Ohio (Citizens-Martins Ferry) and
     The Citizens-State Bank of Strasburg, Strasburg, Ohio
     (Citizens-Strasburg). All significant intercompany transactions and
     balances have been eliminated in consolidation.  The results of operations
     for the period ended June 30, 1997 are not necessarily indicative of the
     operating results for the full year of 1997.

     NATURE OF OPERATIONS:

          The Company and Banks' revenues, operating income and assets are
     primarily from the banking industry.  Citizens-Martins Ferry's loan
     customers are located in Belmont and Jefferson counties in eastern Ohio
     and Marshall and Ohio counties in the northern panhandle of West Virginia.
     Citizens-Strasburg's loan customers are located in Tuscarawas and Carroll
     Counties.  Both geographic locations include a wide range of individuals,
     businesses and other organizations.  A major portion of loans are secured
     by various forms of collateral including real estate, business assets,
     consumer property and other items, although borrower cash flow may also be
     a primary source of payment.  Citizens-Martins Ferry conducts its business
     through its main office in Martins Ferry, Ohio and three branches located
     in Bridgeport, Colerain and St. Clairsville, Ohio.  Citizens-Strasburg
     conducts its business through its main office in Strasburg, Ohio and its
     four branches located in Dover, New Philadelphia, Sherrodsville and
     Dellroy, Ohio.

     USE OF ESTIMATES:

          To prepare financial statements in conformity with generally accepted
     accounting principles, management makes estimates and assumptions based on
     available information.  These estimates and assumptions affect the amounts
     reported in the financial statements and the disclosures provided and
     future results could differ.  The collectibility of loans, fair values of
     financial instruments and status of contingencies are particularly subject
     to change.

     CASH FLOW REPORTING:

          Cash and cash equivalents are defined as cash and due from banks and
     federal funds sold.  Net cash flows are reported for customer loan and
     deposit transactions, securities sold under agreements to repurchase and
     short-term borrowings.  For the periods ended June 30, 1997 and June 30,
     1996, the Company paid $3,576,000 and $3,304,000 in interest on deposits
     and other borrowings and $504,000 and $485,000 for income taxes,
     respectively.

                                       6


<PAGE>   7

                              UNITED BANCORP, INC.
      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                   FORM 10-Q


1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     SECURITIES:

          Securities are classified as held to maturity and carried at
     amortized cost when management has the positive intent and ability to hold
     them to maturity.  Securities are classified as available for sale when
     they might be sold before maturity.  Securities available for sale are
     carried at fair value, with unrealized holding gains and losses reported
     separately in shareholders' equity, net of tax.  Securities are classified
     as trading when held for short term periods in anticipation of market
     gains and are carried at fair value.  Securities are written down to fair
     value when a decline in fair value is not temporary.

          Gains and losses on sales are determined using the amortized cost of
     the specific security sold.  Interest income includes amortization of
     purchase premiums and discounts.

     LOANS:

          Loans are reported at the principal balance outstanding, net of
     deferred loan fees and costs.  Interest income is reported on the interest
     method and includes amortization of net deferred loan fees and costs over
     the loan term.

          Interest income is not reported when full loan repayment is in doubt,
     typically when payments are past due over 90 days.  Payments received on
     such loans are reported as principal reductions.

     ALLOWANCE FOR LOAN LOSSES:

          The allowance for loan losses is a valuation allowance, increased by
     the provision for loan losses and decreased by charge-offs less
     recoveries.  Management estimates the allowance balance required based on
     past loan loss experience, known and inherent risks in the portfolio,
     information about specific borrower situations and estimated collateral
     values, economic conditions and other factors.  Allocations of the
     allowance may be made for specific loans, but the entire allowance is
     available for any loan that, in management's judgment, should be
     charged-off.

          Effective January 1, 1995, the Company adopted the provisions of
     Statement of Financial Accounting Standards ("SFAS") Nos. 114 and 118,
     which modify the accounting for impaired loans.  A loan is considered
     impaired when management believes that full collection of principal and
     interest is not probable.  The Company reduces the carrying value of
     impaired loans to the present value of expected future cash flows, or to
     the fair value of collateral if the loan is collateral dependent, by
     allocating a portion of the allowance for loan losses to such loans.  If
     these allocations should require an increase to the allowance, such
     increase is reported as bad debt expense.

                                       7



<PAGE>   8

                              UNITED BANCORP, INC.
      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                   FORM 10-Q


1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     ALLOWANCE FOR LOAN LOSSES: (CONTINUED)

          Management analyzes commercial and commercial real estate loans on an
     individual basis and classifies a loan as impaired when an analysis of the
     borrower's operating results and financial condition indicates that
     underlying cash flows are not adequate to meet its debt service
     requirements.  Often this is associated with a delay or shortfall in
     payments of 30 days or more, or when the internal grading system indicates
     a doubtful classification.  Loan impairment is evaluated in total for
     smaller-balance loans of similar nature.  Such loans include residential
     first mortgage loans secured by one-to-four family residences, residential
     construction loans and consumer automobile, boat and home equity loans.
     The carrying values of impaired loans are periodically adjusted to reflect
     cash payments, revised estimates of future cash flows and increases in the
     present value of expected cash flows due to the passage of time.  Cash
     payments representing interest income are reported as such.  Other cash
     payments are reported as reductions in carrying value, while increases or
     decreases due to changes in future payments and due to the passage of time
     are reported as part of the provision for loan losses.

     PREMISES AND EQUIPMENT:

          Asset cost is reported net of accumulated depreciation.  Depreciation
     expense is calculated on the straight-line method over asset useful lives.
     These assets are reviewed for impairment when events indicate the
     carrying amount may not be recoverable.

     OTHER REAL ESTATE:

          Real estate acquired in settlement of loans is initially reported at
     estimated fair value at acquisition.  After acquisition, a valuation
     allowance reduces the reported amount to the lower of the initial amount
     or fair value less costs to sell.  Expenses, gains and losses on
     disposition and changes in the valuation allowance are reported in other
     expenses.

     LOAN SERVICING:

          The Company became subject to the provisions of SFAS No. 122,
     "Accounting for Mortgage Servicing Rights," on January 1, 1996.  This
     Standard requires entities to recognize, as separate assets, rights to
     service mortgage loans for others, regardless of how these rights are
     acquired.  Mortgage servicing rights acquired through either the purchase
     or the origination of mortgage loans which are subsequently sold with
     servicing rights retained should be determined by allocating the total
     cost of the mortgage loans to mortgage servicing rights and to loans
     (without the mortgage servicing rights) based on their relative fair
     values.  Mortgage servicing rights recorded as a separate asset are
     amortized in proportion to, and over the period of, estimated net
     servicing income.  SFAS 122 did not have a material impact on the
     Company's financial statements at January 1, 1996.

                                       8



<PAGE>   9

                              UNITED BANCORP, INC.
      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                   FORM 10-Q


1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     IDENTIFIED INTANGIBLES:

          Identified intangibles include the value of depositor relationships
     purchased which are being amortized on an accelerated method over eight
     years.  Identified intangibles also include a non-compete covenant and
     capitalized organizational costs which are being amortized on a
     straight-line method over five years.  Identified intangibles are assessed
     for impairment based on estimated undiscounted cash flows and written down
     if necessary.  At June 30, 1997 and December 31, 1996, identified
     intangibles net of accumulated amortization totaled $141,183 and $173,638
     and are included in other assets in the accompanying consolidated balance
     sheets.

     EMPLOYEE BENEFITS:

          A defined benefit pension plan covers all employees who have
     completed 1,000 hours of service during an anniversary year, measured from
     their date of hire, who have attained age 21 and who were hired before age
     60.  The plan calls for benefits to be paid to eligible employees at
     retirement, based primarily upon years of service and compensation rates
     near retirement.  Contributions to the plan reflect benefits attributed to
     employees' services to date, as well as services expected to be earned in
     the future.  Plan assets consist of primarily common stock and
     certificates of deposit.

          Beginning March of 1995, the Company began offering a 401(k) plan
     which covers all employees who have attained the age of 21 and have
     completed one year of service.  Eligible employees may contribute up to
     15% of their compensation subject to a maximum statutory limitation.  The
     Company may make a discretionary matching contribution equal to a
     percentage of each participant's elective deferral not to exceed 6% of the
     participant's annual compensation.  Employee contributions are always
     vested.  Employer contributions become 100% vested after 5 years of
     service.

          Expense of the defined benefit plan is reported by spreading the
     expected contributions to the plan less long-term earnings on plan assets
     over the employee's service period.  Expense of the 401(k) plan is based
     on the annual contribution.

     STOCK COMPENSATION:

          Expense for employee compensation under stock option plans is based
     on Opinion 25, with expense reported only if options are granted below
     market price at grant date.

     INCOME TAXES:

          Income tax expense is the sum of the current year income tax due or
     refundable and the change in deferred tax assets and liabilities.
     Deferred tax assets and liabilities are the expected future tax
     consequences of temporary differences between the carrying amounts and tax
     bases of assets and liabilities, computed using enacted tax rates.  A
     valuation allowance, if needed, reduces deferred tax assets to the amount
     expected to be realized.

                                       9



<PAGE>   10

                              UNITED BANCORP, INC.
      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                   FORM 10-Q


1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     STOCK DIVIDENDS:

          Dividends issued in stock are reported by transferring the market
     value of the stock issued from retained earnings to common stock and
     additional paid-in-capital.  Stock splits are recorded by transferring the
     par value of shares issued from retained earnings to common stock.  On
     April 17, 1996, a 10% stock dividend was approved for all shareholders of
     record on May 20, 1996 and distributed on June 20, 1996.

     EARNINGS AND DIVIDENDS PER COMMON SHARE:

          Earnings per common share is based on the weighted-average number of
     shares outstanding for the period.  Stock options outstanding do not
     presently have a dilutive effect greater than or equal to 3% on earnings
     per common share.  All per share data has been retroactively adjusted for
     the 10% stock dividend in 1996.

     RECLASSIFICATIONS:

          Some items in prior financial statements have been reclassified to
     conform with the current presentation.

     IMPACT OF RECENT ACCOUNTING STANDARDS:

          SFAS No. 125, "Accounting for Transfers and Servicing of Financial
     Assets and Extinguishments of Liabilities," was issued by the Financial
     Accounting Standards Board ("FASB") in 1996.  It revises the accounting
     for transfers of financial assets, such as loans and securities, and for
     distinguishing between sales and secured borrowings.   It was originally
     effective for some transactions in 1997 and others in 1998.  SFAS No. 127,
     "Deferral of the Effective Date of Certain Provisions of FASB Statement
     No. 125" was issued in December 1996.  SFAS No. 127 defers for one year
     the effective date of provisions related to securities lending, repurchase
     agreements and other similar transactions.  The remaining portions of SFAS
     No. 125 will continue to be effective January 1, 1997.  SFAS No. 125 did
     not have a material impact on the Company's financial statements.

          In March 1997, the FASB issued SFAS No. 128, "Earnings Per Share"
     which is effective for financial statements for periods ending after
     December 15, 1997, including interim periods.  SFAS No. 128 simplifies the
     calculation of earnings per share by replacing primary EPS with basic EPS.
     It also requires dual presentation of basis EPS and diluted EPS for
     entities with complex capital structures.  Basic EPS includes no dilution
     and is computed by dividing income available to common shareholders by the
     weighted-average common shares outstanding for the period.  Diluted EPS
     reflects the potential dilution of securities that could share in earnings
     such as stock options, warrants or other common stock equivalents.  All
     prior period EPS data will be restated to conform with the new
     presentation.

                                       10



<PAGE>   11

                              UNITED BANCORP, INC.
      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                   FORM 10-Q


2.   SECURITIES:

          The amortized cost and estimated fair values of investment securities
     are as follows:

<TABLE>
<CAPTION>                                                       
                                                AMORTIZED        GROSS             GROSS         ESTIMATED
                                                   COST     UNREALIZED GAINS  UNREALIZED LOSSES  FAIR VALUE
                                                -----------------------------------------------------------
<S>                                             <C>             <C>             <C>             <C>
AVAILABLE FOR SALE - JUNE 30, 1997                                                      
US Treasury obligations                         $ 3,246,423     $    50,577                     $ 3,297,000 
US Agency obligations                            23,460,428         169,755     $  (16,169)      23,614,014 
State and Municipal obligations                     456,765          22,924                         479,689 
Other investments                                   657,149          21,665                         678,814 
                                                -----------     -----------     ----------      -----------
                                                $27,820,765     $   264,921     $  (16,169)     $28,069,517 
                                                ===========     ===========     ==========      ===========
                                                        
AVAILABLE FOR SALE - DECEMBER 31, 1996                                                  
US Treasury obligations                         $ 3,725,832     $    73,570                     $ 3,799,402 
US Agency obligations                            23,032,148         146,839     $  (35,153)      23,143,834 
State and Municipal obligations                     456,645          19,298                         475,943 
Other investments                                   635,175           9,675                         644,850 
                                                -----------     -----------     ----------      -----------
                                                $27,849,800     $   249,382     $  (35,153)     $28,064,029 
                                                ===========     ===========     ==========      ===========
                                                                                                
HELD TO MATURITY - JUNE 30, 1997                                                        
US Agency obligations                           $ 8,999,764     $     4,750     $  (43,189)     $ 8,961,325 
State and Municipal obligations                  20,486,635         698,598        (42,158)      21,143,075 
                                                -----------     -----------     ----------      -----------
                                                $29,486,399     $   703,348     $  (85,347)     $30,104,400 
                                                ===========     ===========     ==========      ===========
                                                        
HELD TO MATURITY - DECEMBER 31, 1996                                                    
US Agency obligations                           $ 9,535,396     $     1,000     $  (84,324)     $ 9,452,072 
State and Municipal obligations                  20,258,388         634,056        (92,335)      20,800,109 
                                                -----------     -----------     ----------      -----------
                                                $29,793,784     $   635,056     $ (176,659)     $30,252,181 
                                                ===========     ===========     ==========      ===========
</TABLE>
                                                        


          There were no sales of securities classified as available for sale
     for the six month period ended June 30, 1997.  Total proceeds from sales
     of securities classified as available for sale for the six month period
     ended June 30, 1996 were $3,015,469, with $26,520 realized as gross gains
     on those sales.


                                       11



<PAGE>   12

                              UNITED BANCORP, INC.
      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                   FORM 10-Q


2. SECURITIES: (CONTINUED)

        Contractual maturities of securities at June 30, 1997 were as
   follows:

<TABLE>
<CAPTION>
AVAILABLE FOR SALE                        AMORTIZED              ESTIMATED
                                            COST                 FAIR VALUE
                                        -----------             -----------
<S>                                     <C>                     <C>
US Treasury obligations                         
  6 - 12  Months                        $   488,139             $   497,032 
  1 - 2    Years                          2,758,284               2,799,968 
                                        -----------             -----------
  Total                                   3,246,423               3,297,000 
                                        -----------             -----------
US Agency obligations                           
  0 - 3    Months                           500,000                 500,312 
  3 - 6    Months                         1,950,000               1,964,358 
  6 - 12  Months                          1,001,406               1,009,062 
  1 - 2    Years                          1,482,623               1,497,556 
  2 - 5    Years                         11,332,383              11,386,840 
  5 - 10  Years                           7,194,016               7,255,886 
                                        -----------             -----------
  Total                                  23,460,428              23,614,014 
                                        -----------             -----------
State and municipal obligations                         
  5 - 10  Years                             336,765                 352,969 
 Over 10 Years                              120,000                 126,720 
                                        -----------             -----------
  Total                                     456,765                 479,689 
                                        -----------             -----------
Other investments                               
  Equity securities                         657,149                 678,814 
                                        -----------             -----------
Total securities available for sale     $27,820,765             $28,069,517 
                                        ===========             ===========
HELD TO MATURITY                                

US Agency obligations                           
  3 - 6    Months                       $   999,999             $   999,375 
  6 - 12  Months                          2,500,000               2,492,618 
  1 - 2    Years                          4,499,765               4,471,481 
  2 - 5    Years                          1,000,000                 997,851 
                                        -----------             -----------
  Total                                 $ 8,999,764             $ 8,961,325 
                                        -----------             -----------
State and municipal obligations                         
  0 - 3    Months                           145,034                 145,084 
  3 - 6    Months                           345,704                 345,254 
  1 - 2    Years                            792,159                 814,400 
  2 - 5    Years                          7,518,182               7,778,903 
  5 - 10  Years                          11,579,438              11,953,623 
  Over 10 Years                             106,118                 105,811 
                                        -----------             -----------
  Total                                  20,486,635              21,143,075 
                                        -----------             -----------
Total securities held to maturity       $29,486,399             $30,104,400 
                                        ===========             ===========
</TABLE>




                                       12
<PAGE>   13

                              UNITED BANCORP, INC.
      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                   FORM 10-Q


2.   SECURITIES (CONTINUED)

          Securities with an amortized cost of approximately $25,625,000 at
     June 30, 1997 and $25,125,000 at December 31, 1996 were pledged to secure
     public deposits, repurchase agreements and other liabilities as required
     or permitted by law.

3.   LOANS

          Loans to directors and officers, their immediate families, affiliated
     corporations, and other entities in which they own more than a 10% voting
     interest are summarized below:


<TABLE>
        <S>                                      <C>
        Aggregate balance - December 31, 1996    $      2,135,565 
          New loans                                     1,276,961 
          Repayments                                   (1,100,107)
                                                 ----------------
        Aggregate balance - June 30, 1997        $      2,312,419 
                                                 ================
</TABLE>


4.   ALLOWANCE FOR LOAN LOSSES

          The allowance in the allowance for loan losses is summarized as
     follows:


<TABLE>
<CAPTION>
                                                           1997            1996
                                                        ----------      ----------
        <S>                                             <C>             <C>
        Balance 01/01/97 and 01/01/96                   $2,022,987      $1,775,383 
          Provision charged to operating expense           222,000         455,400 
          Loans charged-off                                (86,367)       (251,241)
          Recoveries                                        28,024          43,445 
                                                        ----------      ----------
        Balance 06/30/97 and 12/31/96                   $2,186,644      $2,022,987                                                 
                                                        ==========      ==========
</TABLE>

          Loans considered impaired under the provisions of SFAS No. 114 were
     not material at June 30, 1997 and December 31, 1996 and during the six
     months ended June 30, 1997 and 1996.

5. PREMISES AND EQUIPMENT

     Premises and equipment at June 30, 1997 and December 31, 1996 are
     summarized as follows:

<TABLE>
<CAPTION>
                                                                   1997            1996
                                                                ----------      ----------
        <S>                                                     <C>             <C>
        Buildings and land                                      $5,297,327      $5,297,242  
        Buildings - leasehold                                      207,535               -          
        Furniture and equipment improvements                     2,607,544       2,649,536          
        Furniture and equipment - leasehold improvements            67,461               -          
        Computer software                                          648,352         637,629          
                                                                ----------      ----------          
          TOTAL                                                  8,828,219       8,584,407          
        Accumulated depreciation                                 3,554,173       3,399,625          
                                                                ----------      ----------          
        PREMISES AND EQUIPMENT, NET                             $5,274,046      $5,184,782          
                                                                ==========      ==========          
</TABLE>



                                       13
<PAGE>   14
                              UNITED BANCORP, INC.
      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                   FORM 10-Q


5.   PREMISES AND EQUIPMENT (CONTINUED)

          On April 1, 1997, Citizens-Martins Ferry entered into a five year
     noncancelable operating lease for an in-store banking facility.  The lease
     may be renewed for up to two additional five-year terms after March 31,
     2002.  Annual rent expense during the initial term of the lease is
     $22,500.  Annual rent during the second and third five year terms would be
     $26,000 and $30,000, respectively.  Rental expense through June 30, 1997
     was $5,625.  Future lease payments are as follows:

<TABLE>
                <S>                             <C>
                Year ended June 30,  1998       $ 22,500 
                                     1989         22,500 
                                     2000         22,500 
                                     2001         22,500 
                                     2002         16,875 
                                                --------
                                                $106,875 
                                                ========
</TABLE>

6.   SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE

          Securities sold under agreements to repurchase are financing
     arrangements whereby the Banks sell securities and agree to repurchase the
     identical securities at the maturities of the agreements at specified
     prices.  Physical control is maintained for all securities sold under
     repurchase agreements.  Information concerning securities sold under
     agreements to repurchase is summarized as follows:


<TABLE>
<CAPTION>
                                                        SIX MONTHS     TWELVE MONTHS
                                                           ENDED           ENDED
                                                          JUNE 30,      DECEMBER 31,
                                                           1997            1996
                                                        ----------      ----------
        <S>                                             <C>             <C>
        Average daily balance during the period         $7,802,070      $6,523,271 
        Average interest rate during the period               4.37%           4.30%
        Maximum month-end balance during the period     $8,658,035      $8,667,310 
</TABLE>
                        
          Securities underlying these agreements were as follows:

<TABLE>
<CAPTION>
                                                          JUNE 30,      DECEMBER 31,
                                                           1997           1996
                                                        ----------      ----------
        <S>                                             <C>             <C>
        Carrying value of securities                    $9,571,440      $9,574,054 
        Fair value of securities                         9,680,723       9,606,556 
</TABLE>



                                       14
<PAGE>   15
                              UNITED BANCORP, INC.
      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                   FORM 10-Q


7.   COMMITMENTS AND CONTINGENCIES

          There are various contingent liabilities that are not reflected in
     the financial statements, including claims and legal actions arising in
     the ordinary course of business.  In the opinion of management, after
     consultation with legal counsel, the ultimate disposition of these matters
     is not expected to have a material effect on financial condition or
     results of operations.

          Some financial instruments are used in the normal course of business
     to meet the financing needs of customers.  These financial instruments
     include commitments to extend credit, standby letters of credit and
     financial guarantees.  These involve, to varying degrees, credit and
     interest-rate risk in excess of the amount reported in the financial
     statements.

          Exposure to credit loss if the other party does not perform is
     represented by the contractual amount for commitments to extend credit,
     standby letters of credit and financial guarantees written.  The same
     credit policies are used for commitments and conditional obligations as
     are used for loans.  The amount of collateral obtained, if deemed
     necessary, upon extension of credit is based on management's credit
     evaluation.  Collateral varies, but may include accounts receivable,
     inventory, property, equipment, income-producing commercial properties,
     residential real estate and consumer assets.

          Commitments to extend credit are agreements to lend to a customer as
     long as there is no violation of any condition established in the
     commitment.  Commitments generally have fixed expiration dates or other
     termination clauses and may require payment of a fee.  Since many of the
     commitments are expected to expire without being used, the total
     commitments does not necessarily represent future cash requirements.
     Standby letters of credit and financial guarantees written are conditional
     commitments to guarantee a customer's performance to a third party.

          A summary of the notional or contractual amounts of financial
     instruments with off-balance sheet risk at June 30, 1997 and December 31,
     1996 follows:

<TABLE>
<CAPTION>
                                          JUNE 30,      DECEMBER 31,
                                           1997            1996
                                        -----------     -----------
        <S>                             <C>             <C>
        Commitments to extend credit    $15,989,380     $11,751,000 
        Standby letters of credit           156,000         156,000 
                                        -----------     -----------
                                        $16,145,380     $11,907,000 
                                        ===========     ===========
</TABLE>


          At June 30, 1997 and December 31, 1996 and included above,
     commitments to make fixed-rate loans at current market rates totaled
     $83,000 and $80,000, respectively with the interest rates on those
     fixed-rate commitments ranging from 7.84% to 10.50% and 7.84% to 9.99%,
     respectively.

          At June 30, 1997 and December 31, 1996, reserves of $676,000 were
     required as deposits with the Federal Reserve or as cash on hand.  These
     reserves do not earn interest.

                                       15

<PAGE>   16

                              UNITED BANCORP, INC.
      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                   FORM 10-Q


8.   CONCENTRATION OF CREDIT RISK

          The Banks grant commercial, commercial real estate, real estate and
     installment loans to customers in Belmont and Jefferson counties in
     eastern Ohio and Tuscarawas and Carroll Counties in northeastern Ohio.
     The Banks also grant commercial and commercial real estate loans in the
     Columbus, Ohio area.  Substantially all loans are secured by specific
     items of collateral including business assets, consumer assets, commercial
     real estate and residential real estate.  At June 30, 1997 and December
     31, 1996, total commercial and commercial real estate loans made up 41.4%
     and 40.4%, respectively of the loan portfolio, with 24.6% and 29.4% of
     these loans secured by commercial and residential real estate and business
     assets in the Columbus, Ohio area.  At June 30, 1997 and December 31,
     1996, installment loans account for 34.3% and 34.0% of the loan portfolio
     and are secured by consumer assets including automobiles which account for
     83.9% and 83.1%, respectively of the installment loan portfolio.  Real
     estate loans comprise 24.2% and 25.5% of the loan portfolio as of June 30,
     1997 and December 31, 1996, respectively, and primarily include first
     mortgage loans on residential properties and home equity lines of credit.

          Included in cash and due from banks and Federal funds sold as of June
     30, 1997 and December 31, 1996 is $3,411,651 and $3,639,127, respectively
     on deposit with a correspondent bank.

9.   STOCK OPTIONS

          The Company adopted a nonqualified stock option plan for directors
     and bank holding company officers in 1995.  The plan was subsequently
     ratified by shareholders on April 17, 1996.  The exercise price for
     options granted under this plan will be no less than 100% of the fair
     market value of the shares on the date of grant.

<TABLE>
<CAPTION>
                                                                AVERAGE
                                                                EXERCISE
                                                SHARES           PRICE
                                                ------          --------
        <S>                                     <C>             <C>
        Outstanding at December 31, 1996        71,350          $  13.60 
        Granted                                      -               -   
        Exercised                               (1,650)            13.59 
        Forfeited                               (1,650)            13.59 
                                                ------          --------
        Outstanding at June 30, 1997            68,050          $  13.60 
                                                ======          ========
        Remaining shares available for                  
          grant at June 30, 1997                31,937               
                        
        Options exercisable at June 30, 1997         -           
</TABLE>


                                       16

<PAGE>   17

                              UNITED BANCORP, INC.
      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                   FORM 10-Q


9.   STOCK OPTIONS (CONTINUED)

     The following table summarizes information about stock options outstanding
at June 30, 1997:

<TABLE>
<CAPTION>
                               NUMBER                               NUMBER
                EXERCISE     OUTSTANDING        DATE OF           EXERCISABLE
                 PRICE       AT 06/30/97       EXPIRATION         AT 06/30/97
                --------     -----------       ----------         -----------
                <S>             <C>             <C>                 <C>
                $ 13.59         66,550          11/21/05                - 
                  14.26          1,500          11/21/05                - 
</TABLE>


          The options are first exercisable after February 21, 2005, except in
     the event certain financial performance criteria are met, in which case
     such options may become exercisable in installment, 40% in 1998, 20% in
     1999 and the balance in 2000.  All options become immediately exercisable
     upon retirement, death or in the event of a change in control of the
     Company.

10.  DIVIDEND RESTRICTION

          Dividends paid by the subsidiary banks are the primary source of
     funds available to the Company for payment of dividends to shareholders
     and for other working capital needs.  Applicable state statutes and
     regulations impose restrictions on the amount of dividends that may be
     declared by the Company.  Those restrictions generally limit dividends to
     the current and prior two years earnings, (as defined), totaling
     $4,821,940 as of June 30, 1997.  In addition to these restrictions, as a
     practical matter, dividend payments cannot reduce regulatory capital
     levels below minimum regulatory guidelines.  These restrictions would not
     limit the Company's ability to pay normal dividends.


                                       17



<PAGE>   18

                              UNITED BANCORP, INC.
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                                   FORM 10-Q


        In the following pages, Management presents an analysis of United
Bancorp, Inc.'s financial condition at June 30, 1997 compared to December 31,
1996 and results of operations for the three and six months ended June 30, 1997
compared to the same periods in 1996.  This discussion is designed to provide
shareholders with a more comprehensive review of the operating results and
financial position than could be obtained from an examination of the financial
statements alone.  This analysis should be read in conjunction with the
financial statements and related footnotes and the selected financial data
included elsewhere in this report.

        United Bancorp, Inc. was created as a single bank holding company in
July of 1983 through the acquisition of 100% of the voting stock of The Citizens
Savings Bank of Martins Ferry, Ohio.  United Bancorp, Inc. became a multi-bank
holding company in December of 1986 through the purchase of 100% of the voting
stock of The Citizens-State Bank of Strasburg, Strasburg, Ohio.  Common stock
was available through over-the-counter trading until February 1994 when it began
trading on The Nasdaq SmallCaps Market tier of The Nasdaq Stock Market under the
trading symbol UBCP.

        The Citizens Savings Bank (Citizens-Martins Ferry), originally
established as The  German Savings Bank in 1902, remains the lead bank in the
multi-bank holding company and continues as an integral part of the development
of the commercial and residential base in Martins Ferry and other local
communities.  The Bank expanded its market through the construction of a full
service branch banking facility six miles west in nearby Colerain, Ohio in
1974.  Expansion opportunities continued in 1978 with the construction of
another full service branch bank in Bridgeport, Ohio, located two miles south
of Martins Ferry.  A limited service auto-teller facility was opened in Martins
Ferry in 1980, one block south of the former main office location.  An
Automated Teller Machine (ATM) began operation in nearby Aetnaville, Ohio in
1983, providing additional 24 hour limited banking services to area residents. 
The main banking facility outgrew the physical limitations of its previous
location and subsequently relocated in 1984 to a newly constructed 21,500
square foot addition to the auto-teller facility mentioned above.  On June 16,
1997 an in-store retail banking sales center was opened within a local area
food store in St. Clairsville, Ohio.  This newest banking facility is open
seven days a week providing full-service banking to an expanding new market. 
The site also includes a free standing ATM for additional customer service.

        The Citizens-State Bank of Strasburg (Citizens-Strasburg), was also
established in 1902 and is located in an area of northeastern Ohio whose economy
is supported by agriculture and light industry.  Additionally, it benefits as a
"bedroom community" for the Akron-Canton metropolitan area. Citizens-Strasburg
joined the bank holding company in 1986 through the acquisition of 100% of its
voting stock by UBCP.  Citizens-Strasburg constructed a new full service banking
facility in Dover, Ohio in 1990. This expansion was soon followed with the
acquisition of two branch banking facilities in New Philadelphia and
Sherrodsville in 1992. Additionally, a branch banking facility located in
Dellroy, Ohio was acquired in 1994.  This most recent acquisition brought the
number of offices to five for Citizens-Strasburg and nine overall for UBCP.

                                       18


<PAGE>   19

                              UNITED BANCORP, INC.
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                                  FORM 10-Q


FINANCIAL CONDITION

EARNING ASSETS - LOANS

        At June 30, 1997, gross loans were $135,847,000 compared to $132,661,000
at year-end 1996, representing a 2.4% increase in loan volume.  Loan growth was
hampered by a weakened local economy in the Citizens-Martins Ferry market area
resulting from the continuation of a prolonged work-stoppage at the
Wheeling-Pittsburgh Steel Corporation plants located throughout the greater Ohio
Valley.  Real estate loan origination volume is expected to increase due to the
Banks' involvement in the secondary market program, however, as these loans will
be sold, the balance of real estate loans held in the portfolio is expected to
decline.

        Installment loans, with continued emphasis placed on the indirect
automobile lending market located primarily within the Citizens-Martins Ferry
market area, increased a modest $1,484,000, or 3.3% at June 30, 1997 compared to
year-end 1996.  Installment lending represented 34.3% of the entire portfolio
mix at June 30, 1997, up slightly from 34.0% at year-end 1996.  The indirect
lending type of financing carries somewhat more risk than real estate lending,
however, it also provides for potentially higher yields.  The targeted lending
areas encompass four metropolitan areas, minimizing the risk to changes in
economic conditions in the communities housing the Company's nine banking
locations.  Despite the geographic market diversification, the Company's
installment lending activity has slowed due to the work stoppage cited above
within the Citizens-Martins Ferry market area.

        Commercial real estate loans at June 30, 1997 increased $507,000 or 1.2%
over year-end 1996 totals.  Commercial loans at June 30, 1997 increased
$2,164,000, or 17.4% over year-end 1996 totals.  Commercial real estate loans
declined in relation to the total portfolio mix to 30.7% at June 30, 1997 from
31.1% at year-end 1996.  Commercial loans increased to 10.7% of the portfolio at
June 30, 1997 compared to 9.4% at year-end 1996. Only slight to moderate
commercial loan growth is anticipated throughout the remainder of 1997.

        Out of area loans occur mostly in the Columbus and Akron-Canton, Ohio
areas.  Lending beyond the local area has been for projects and borrowers with
substantial net worth.  The majority of these loans are secured by real estate
holdings comprised of hotels, motels and churches located in various geographic
locations minimizing potential risks associated with lending activities specific
to a limited area.  Out of area loans at June 30, 1997 were 10.2% of total loans
and 24.6% of total commercial and commercial real estate loans compared to 11.9%
and 29.4% at year-end 1996.

        Real estate loans were 24.2% of total loans at June 30, 1997 compared to
25.5% at year-end 1996.  As indicated above, the Banks' involvement in the
secondary market program should yield increases in loan origination volume,
however, it is anticipated that borrower preferences will favor the secondary
market product offerings with a decline expected in real estate loans held
within the loan portfolio.

                                       19



<PAGE>   20

                              UNITED BANCORP, INC.
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                                  FORM 10-Q


EARNING ASSETS - LOANS (CONTINUED)

        The allowance for loan losses represents the amount which management and
the Board of Directors estimates is adequate to provide for inherent losses in
the loan portfolio.  The allowance balance and the annual provision charged to
expense are reviewed by management and the Board of Directors monthly using a
risk code model that considers borrowers past due experience, economic
conditions and various other circumstances that are subject to change over 
time.  Management believes the balance of the allowance for loan losses 
currently in place continues to be sufficient to deal with potential losses 
associated with the aforementioned work stoppage.  Charge-offs for the six 
months ended June 30, 1997 were 20.3% less than the total for the same six 
month period in 1996.

EARNING ASSETS - SECURITIES AND FEDERAL FUNDS SOLD

        The securities portfolio is comprised of U.S. Treasury notes and other
U.S. Government agency-backed securities, tax-exempt obligations of states and
political subdivisions and certain other investments.  The Company does not hold
any collateralized mortgage-backed securities, other than those issued by U.S.
government agencies or derivative securities. The quality rating of obligations
of state and political subdivisions within Ohio is no less than Aaa, Aa or A,
with all out-of-state bonds rated at AAA.  Board policy permits the purchase of
certain non-rated bonds of local schools, townships and municipalities, based on
their known levels of credit risk.

        Securities available for sale at June 30, 1997, net of the unrealized
gain market value adjustment of $249,000 (before tax effect), decreased $29,000.
from year-end 1996 totals, net of an unrealized gain market value adjustment of
approximately $214,000 (before tax effect) at year-end 1996. Securities held to
maturity decreased a net $307,000 at June 30, 1997 compared to year-end 1996
totals.  Management anticipates maintaining relatively stable levels of
securities, utilizing excess deposit growth to fund future loan development.

SOURCES OF FUNDS - DEPOSITS

        The Company's primary source of funds is core deposits from retail and
business customers.  These core deposits include interest-bearing and
noninterest-bearing deposits, excluding certificates of deposit over $100,000. 
Total core deposits decreased $687,000 during the six months ended June 30, 1997
due to pricing of those products being slightly below the market area. 
Management has chosen to concentrate on earnings performance during the first
six months of the year with renewed emphasis to be placed on deposit growth
during the second half of the year dependent upon the outcome of the work
stoppage within the Citizens-Martins Ferry market place cited earlier.    The
Company has a strong deposit base from public agencies, including local school
districts, city and township municipalities, public works facilities and others
which may tend to be more seasonal in nature resulting from the receipt and
disbursement of state and Federal grants.  These entities have maintained fairly
static balances with the Company due to various funding and disbursement
timeframes.

        Certificates of deposit over $100,000 are not considered part of core
deposits and as such are used to balance rate sensitivity as a tool of funds
management.  At June 30, 1997, certificates of deposit over $100,000 increased
$262,000 over year-end 1996 totals.

                                       20



<PAGE>   21

                              UNITED BANCORP, INC.
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                                  FORM 10-Q


SOURCES OF FUNDS - SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE AND
OTHER SHORT-TERM BORROWINGS

        Other interest-bearing liabilities include securities sold under
agreements to repurchase, sweep accounts, Federal funds purchased, Treasury, Tax
& Loan note payable and Federal Home Loan Bank advances. Total short-term
borrowings at June 30, 1997 increased $2,746,000 from management's utilization
of FHLB lines of credit, matched loans and overnight federal funds purchased for
funding loan growth.  Short-term borrowing sources were used rather than
longer-term deposits due to the uncertainty of future loan demand due to the
aforementioned work stoppage.

PERFORMANCE OVERVIEW

NET INCOME

        Net income for the three and six months ended June 30, 1997 was
$693,000, or 5.32% over the three months ended June 30, 1996 and $1,371,000, or
5.06% over the six months ended June 30, 1996.  This equates to an annualized
income performance of 1.35% Return on Average Assets (ROA) and a 13.40% Return
on Average Equity (ROE).

NET INTEREST INCOME

        Net interest income, by definition, is the difference between interest
income generated on interest-earning assets and the interest expense incurred on
interest-bearing liabilities.  Various factors contribute to changes in net
interest income, including volumes, interest rates and the composition or mix of
interest-earning assets in relation to interest-bearing liabilities.  Net
interest income for the three and six months ended June 30, 1997 increased
$140,000, or 6.8% and $254,000, or 6.2%, respectively over the same periods in
1996.  The increases mirror the growth in total assets since June 30, 1996.  The
Company's net interest spread has remained relatively stable over the past year.
Consequently, the increases in net interest income over the comparative prior
periods is largely due to growth.

        Total interest income for the three and six months ended June 30, 1997
increased $302,000, or 8.2% and $529,000, or 7.2%, respectively over the same
periods in 1996.  The increases in interest income slightly outpace the growth
in assets primarily because the growth occurred in the loan portfolio which
traditionally yields a higher return than the security portfolio or other
short-term investments.

        Total interest expense for the three and six months ended June 30, 1997
increased $161,000, or  9.8% and $275,000, or 8.4%, respectively over the same
periods in 1996.  Management has funded loan growth through borrowed funds of
short duration rather than increase the cost of funds across the board on
depository products.  As future events unfold, pricing strategies will be
implemented to enhance the Company's position to attract additional deposits.

                                       21



<PAGE>   22

                              UNITED BANCORP, INC.
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                                  FORM 10-Q


PROVISION FOR LOAN LOSSES

        The provision for loan losses is an operating expense recorded to
maintain the related balance sheet allowance for loan losses at an amount
considered adequate to cover losses that may occur in the normal course of
lending.  The total provision for loan losses was $111,000 and $222,000 for the
three and six months ended June 30, 1997 compared to $122,000 and $233,000 for
the three and six months ended June 30, 1996.  If events in the
Wheeling-Pittsburgh Steel work stoppage mentioned above unfold in ways
unforeseen, changes to the provision amount would be initiated as management
deems appropriate.

NONINTEREST INCOME

        Total noninterest income is made up of Bank related fees and service
charges, as well as other income producing services provided, including ATM
income, early redemption penalties for certificates of deposits, safe deposit
rental income and other miscellaneous items.  Noninterest income for the three 
and six months ended June 30, 1997 decreased $32,000, or 13.2% and $36,000, or
7.4% over the same periods in 1996.  The prior comparative periods include
$27,000 in security gains recognized on the sale of securities available for
sale during 1996.  Changes related to other noninterest income net of the
security gains were minimal for the three and six months ended June 30, 1997.

NONINTEREST EXPENSE

        Noninterest expense for the three and six months ended June 30, 1997
increased $68,000, or 5.1% and $153,000, or 5.9% over the three and six months
ended June 30, 1996.  Increases in salaries and employee benefits and other
related expenses attributable to the in-store banking facility in St.
Clairsville, Ohio contributed most to the increase in noninterest expenses for
the period.

CAPITAL RESOURCES

        Internal capital growth, through the retention of earnings, is the
primary means of maintaining capital adequacy for the Company. Shareholders'
equity at June 30, 1997 was $20,987,000 compared to $20,016,000 at December 31,
1996, a 4.9% increase.  Equity at June 30, 1997 includes a $164,000 unrecognized
increase in equity due to the after tax impact of the fair value of securities
categorized as available for sale as compared to a $142,000 increase in equity
at December 31, 1996. Total shareholders' equity in relation to total assets was
10.2% at June 30, 1997 and 9.9% at December 31, 1996.

        During 1996, the Company initiated a Dividend Reinvestment Plan (The
Plan) for shareholders under which the Company's common stock will be purchased
by the Plan for participants with automatically reinvested dividends.  The Plan
provides an economical and convenient method for the holders of shares of the
Company's common stock to purchase additional shares of common stock at market
prices and without payment of  brokerage commissions or service charges.  The
Plan does not represent a change in the Company's dividend policy or a guarantee
of future dividends. Shareholders who do not wish to participate in the Plan
will continue to receive cash dividends, as declared in the usual and customary
manner. The Company has approved the issuance of 150,000 authorized and unissued
shares of the Company's common stock for purchase under The Plan.  To date, all
shares purchased by the Plan except for 797 shares purchased on October 21, 1996
have been purchased on the open market.

                                       22



<PAGE>   23

                              UNITED BANCORP, INC.
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                                  FORM 10-Q


CAPITAL RESOURCES (CONTINUED)

        The Company and Banks are subject to regulatory capital requirements
administered by federal banking agencies.  Capital adequacy guidelines and
prompt corrective action regulations involve quantitative measures of assets,
liabilities and certain off-balance sheet items calculated under regulatory
accounting practices.  Capital amounts and classifications are also subject to
qualitative judgments by regulators about components, risk weightings and other
factors and the regulators can lower classifications in certain cases.  Failure
to meet various capital requirements can initiate regulatory action that could
have a direct material effect on the Banks' operations.

        The prompt corrective action regulations provide five classifications,
including well capitalized, adequately capitalized, undercapitalized,
significantly undercapitalized and critically undercapitalized, although these
terms are not used to represent overall financial condition.  If adequately
capitalized, regulatory approval is required to accept brokered deposits.  If
undercapitalized, capital distributions are limited, as is asset growth and
expansion and plans for capital restoration are required.  The minimum
requirements are:


<TABLE>
<CAPTION>
                                         TOTAL           TIER 1          TIER 1
                                       CAPITAL TO      CAPITAL TO      CAPITAL TO
                                     RISK-WEIGHTED   RISK-WEIGHTED      AVERAGE
                                        ASSETS          ASSETS          ASSETS
                                     -------------   -------------     ----------
        <S>                             <C>             <C>             <C>
        Well capitalized                10.00%          6.00%           5.00%
        Adequately capitalized           8.00%          4.00%           4.00%
        Undercapitalized                 6.00%          3.00%           3.00%
</TABLE>


          The following table illustrates the Company's risk-weighted capital
     ratios at June 30, 1997:

<TABLE>
<CAPTION>
                                                 JUNE 30, 1997
                                                ----------------
        <S>                                     <C>
        Tier 1 capital                          $     20,682,000 
        Total risk-based capital                $     22,423,000 
        Risk-weighted assets                    $    138,835,000 
        Average total assets                    $    204,946,000 

        Tier 1 capital to average assets                  10.09%
        Tier 1 risk-based capital ratio                   14.90%
        Total risk-based capital ratio                    16.15%
</TABLE>

LIQUIDITY

        Management's objective in managing liquidity is to maintain the ability
to continue to meet the cash flow needs of its customers, such as borrowings or
deposit withdrawals, as well as its own financial commitments.  The principal
sources of liquidity are net income, loan payments, maturing securities and
sales of securities available for sale, federal funds sold and cash and deposits
with banks.  Along with its liquid assets, the Banks have additional sources of
liquidity available to ensure that adequate funds are available as needed which
include, but are not limited to, the purchase of federal funds, the ability to
borrow funds under line of credit agreements with correspondent banks and a
borrowing agreement with the Federal Home Loan Bank of Cincinnati, Ohio and the
adjustment of interest rates to obtain depositors.  Management feels that is has
the capital adequacy, profitability and reputation to meet the current and
projected needs of its customers.

                                       23



<PAGE>   24

                              UNITED BANCORP, INC.
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                                  FORM 10-Q


LIQUIDITY (CONTINUED)

        For the six months ended June 30, 1997, the adjustment to reconcile net
income to net cash from operating activities consisted mainly of depreciation
and amortization of premises and equipment and intangibles, the provision for
loan losses, net amortization of securities and net changes in other assets and
liabilities.  For a more detailed illustration of sources and uses of cash,
refer to the condensed consolidated statements of cash flows.

INFLATION

        Substantially all of the Company's assets and liabilities relate to
banking activities and are monetary in nature.  The consolidated financial
statements and related financial data are presented in accordance with Generally
Accepted Accounting principles (GAAP).  GAAP currently requires the Company to
measure the financial position and results of operations in terms of historical
dollars, with the exception of securities available-for-sale which are measured
at fair value.  Changes in the value of money due to rising inflation can cause
purchasing power loss.

        Management's opinion is that movements in interest rates affects the
financial condition and results of operations to a greater degree than changes
in the rate of inflation.  It should be noted that interest rates and inflation
do effect each other, but do not always move in correlation with each other. 
The Company's ability to match the interest sensitivity of its financial assets
to the interest sensitivity of its liabilities in its asset/liability management
may tend to minimize the effect of changes in interest rates on the Company's
performance.

REGULATORY REVIEW

        The Company is subject to the regulatory requirements of The Federal
Reserve System as a multi-bank holding company.  The affiliate banks are subject
to regulations of the Federal Deposit Insurance Corporation (FDIC) and the State
of Ohio, Division of Financial Institutions.







                                       24



<PAGE>   25
                              UNITED BANCORP, INC.
                               OTHER INFORMATION
                                   FORM 10-Q


PART II - OTHER INFORMATION


ITEM 1.  LEGAL PROCEEDINGS
         Not applicable.

ITEM 2.  CHANGES IN SECURITIES
         Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES
         Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

                    The following matters were submitted to a vote of security
         holders at the Annual Meeting of Shareholders' on April 16, 1997:

         -    Compensation for Outside Directors to continue to be set at 
              $1,000 per year as retainer and $250 per meeting attended.

              Roll Call:  Ayes: 1,572,068   Nays: 34,766  Abstaining: 23,542

         -    Number of Directors to be set at a minimum of nine and a maximum 
              of thirteen.

              Roll Call:  Ayes: 1,628,752   Nays: 0       Abstaining: 368

         -    Election of Directors for the Class of 2000 to include the 
              following:

              James W. Everson   Ayes: 1,628,852    Nays: 0   Abstaining: 368
              Errol C. Sambuco   Ayes: 1,628,852    Nays: 0   Abstaining: 368
              Matthew C. Thomas  Ayes: 1,628,852    Nays: 0   Abstaining: 368


         -    Crowe, Chizek and Company LLP, Independent Certified Public 
              Accountants to continue to serve as the Company's external audit 
              firm for the fiscal year 1997.


              Roll Call:   Ayes: 1,629,082    Nays: 1,257    Abstaining: 38

ITEM 5.  OTHER INFORMATION
         Not applicable.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8 K

         (a)  Exhibits
         
         (b)  Reports on Form 8 K
         
                The Company filed no form 8 Ks with the Securities Exchange
                Commission during the quarter ending June 30, 1997.

                                       25


<PAGE>   26

                              UNITED BANCORP, INC.
                               OTHER INFORMATION
                                   FORM 10-Q


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.




















August 11, 1997                         By:
---------------                            --------------------------------
Date                                    James W. Everson
                                        Chairman, President & Chief Executive 
                                        Officer





August 11, 1997                         By:
---------------                            -------------------------------
Date                                    Ronald S. Blake
                                        Treasurer





                                       26
<PAGE>   27

                              INDEX TO EXHIBITS



EXHIBIT NO.                                     DESCRIPTION
-----------                                     -----------
    27                                          Financial Data Schedule