<PAGE>

                                  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, 2006

[ ]  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.)

<TABLE>
<S>                                                          <C>
              OHIO                                                34-1405357
(State or other jurisdiction of                                 (IRS Employer
 incorporation or organization)                              Identification No.)
</TABLE>

              201 SOUTH 4TH STREET, MARTINS FERRY, OHIO 43935-0010
               (Address of principal executive offices) (Zip Code)

                                 (740) 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 BY CHECK MARK WHETHER THE REGISTRANT IS A LARGE ACCELERATED FILER, AN
ACCELERATED FILER, OR A NON-ACCELERATED FILER. SEE DEFINITION OF "ACCELERATED
FILER AND LARGE ACCELERATED FILER" IN RULE 12B-2 OF THE EXCHANGE ACT. (CHECK
ONE.)

LARGE ACCELERATED FILER [ ] ACCELERATED FILER [ ] NON-ACCELERATED FILER [X]

INDICATE BY CHECK MARK WHETHER THE REGISTRANT IS A SHELL COMPANY (AS DEFINED IN
EXCHANGE ACT RULE 12B-2). YES     NO  X
                              ---    ---

     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 4,567,317 SHARES AS OF AUGUST 1, 2006

<PAGE>

                              UNITED BANCORP, INC.

                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                       In thousands, except per share data

PART I
FINANCIAL INFORMATION

<TABLE>
<CAPTION>
                                                                        JUNE 30,    DECEMBER 31,
                                                                          2006          2005
                                                                      -----------   ------------
                                                                      (Unaudited)
<S>                                                                   <C>           <C>
      ASSETS

Cash and due from financial institutions                               $  9,684       $ 10,009
Interest-bearing deposits in other financial institutions                 3,321          3,868
                                                                       --------       --------
      Total cash and cash equivalents                                    13,005         13,877
Securities available for sale - at market                               125,292        121,946
Securities held to maturity - estimated fair value of
   $19,586 at June 30, 2006 and $20,483 at December 31, 2005             19,659         20,262
Total loans                                                             236,279        232,011
Allowance for loan losses                                                (2,839)        (2,904)
                                                                       --------       --------
Loans - net                                                             233,440        229,107
Federal Home Loan Bank stock - at cost                                    4,429          4,306
Premises and equipment                                                    7,398          7,605
Accrued interest receivable                                               2,376          2,363
Other real estate and repossessions                                       1,183          1,244
Core deposit and other intangible assets                                     12             18
Bank owned life insurance                                                 8,324          8,186
Other assets                                                              4,200          3,019
                                                                       --------       --------
      Total assets                                                     $419,318       $411,933
                                                                       ========       ========

      LIABILITIES AND SHAREHOLDERS' EQUITY

Demand deposits
   Noninterest-bearing                                                 $ 27,015       $ 26,614
   Interest-bearing                                                      96,441         82,295
Savings deposits                                                         34,180         37,634
Time deposits - under $100,000                                          123,993        121,249
Time deposits - $100,000 and over                                        39,896         39,123
                                                                       --------       --------
         Total deposits                                                 321,525        306,915
Federal funds purchased                                                   2,358         12,545
Advances from the Federal Home Loan Bank                                 50,389         47,334
Securities sold under agreements to repurchase                            8,181          7,142
Trade date security purchases                                             1,000             --
Subordinated debentures                                                   4,000          4,000
Accrued expenses and other liabilities                                    1,445          1,517
                                                                       --------       --------
         Total liabilities                                              388,898        379,453
Commitments                                                                  --             --
Shareholders' equity
   Preferred stock - 2,000,000 shares without par value authorized;
      no shares issued                                                       --             --
   Common stock - $1 par value; 10,000,000 shares authorized;
      4,638,531 and 4,615,111 shares issued at June 30, 2006 and
      December 31, 2005, respectively                                     4,638          4,615
   Additional paid-in capital                                            27,205         26,919
   Retained earnings                                                      7,582          7,776
   Stock held by deferred compensation plan; 86,752 shares at June
      30, 2006 and 83,024 shares at December 31, 2005 - at cost            (947)          (892)
   Treasury stock -71,214 at June 30, 2006 and 27,500 shares at
      December 31, 2005 - at cost                                          (807)          (329)
   Less required contributions for shares acquired by Employee
      Stock Ownership Plan (ESOP)                                        (3,417)        (3,417)
   Accumulated comprehensive loss, unrealized losses on
      securities designated as available for sale, net of tax
         benefits                                                        (3,834)        (2,192)
                                                                       --------       --------
      Total shareholders' equity                                         30,420         32,480
                                                                       --------       --------
      Total liabilities and shareholders' equity                       $419,318       $411,933
                                                                       ========       ========
</TABLE>

The accompanying notes are an integral part of these statements.


                                        2

<PAGE>


                              UNITED BANCORP, INC.

                      CONSOLIDATED STATEMENTS OF EARNINGS
                      In thousands, except per share data

<TABLE>
<CAPTION>
                                                                 THREE MONTHS        SIX MONTHS
                                                                ENDED JUNE 30,     ENDED JUNE 30,
                                                               ---------------   -----------------
                                                                2006     2005      2006      2005
                                                               ------   ------   -------   -------
                                                                           (Unaudited)
<S>                                                            <C>      <C>      <C>       <C>
Interest and dividend income
   Loans, including fees                                       $4,452   $3,810   $ 8,624   $ 7,344
   Taxable securities                                           1,420    1,258     2,810     2,585
   Non-taxable securities                                         343      323       643       638
   Federal funds sold                                              38        4        88         5
   Dividends on Federal Home Loan Bank stock and other             66       51       139        96
                                                               ------   ------   -------   -------
         Total interest and dividend income                     6,319    5,446    12,304    10,668
Interest expense
   Deposits
      Demand                                                      629      231     1,114       377
      Savings                                                      30       38        61        76
      Time                                                      1,679    1,464     3,247     2,845
   Borrowings                                                     813      427     1,564       836
                                                               ------   ------   -------   -------
         Total interest expense                                 3,151    2,160     5,986     4,134
         Net interest income                                    3,168    3,286     6,318     6,534
Provision for loan losses                                         302      116       404       260
                                                               ------   ------   -------   -------
         Net interest income after provision for loan losses    2,866    3,170     5,914     6,274
Noninterest income (expense)
   Service charges on deposit accounts                            324      315       674       629
   Realized losses on sales of securities                        (320)      (9)     (350)       (6)
   Realized gains on sales of loans                                 5        6        10        12
   Other income                                                   271      277       558       520
                                                               ------   ------   -------   -------
         Total noninterest income                                 280      589       892     1,155
Noninterest expense
   Salaries and employee benefits                               1,432    1,313     2,895     2,678
   Occupancy and equipment                                        387      325       717       655
   Professional services                                          218      147       332       249
   Insurance                                                       89       82       171       157
   Franchise and other taxes                                      107      102       205       201
   Advertising                                                     89       82       194       164
   Stationery and office supplies                                  61       54       121       120
   Amortization of intangibles                                      5        5         9         9
   Other expenses                                                 553      530     1,086     1,027
                                                               ------   ------   -------   -------
         Total noninterest expense                              2,941    2,640     5,730     5,260
                                                               ------   ------   -------   -------
         Earnings before income taxes (benefit)                   205    1,119     1,076     2,169
Income tax expense (benefit)                                      (82)     238        87       467
                                                               ------   ------   -------   -------
         Net earnings                                          $  287   $  881   $   989   $ 1,702
                                                               ======   ======   =======   =======
         EARNINGS PER COMMON SHARE
            Basic                                              $ 0.07   $ 0.21   $  0.24   $  0.41
                                                               ======   ======   =======   =======
            Diluted                                            $ 0.07   $ 0.21   $  0.24   $  0.41
                                                               ======   ======   =======   =======
         DIVIDENDS PER COMMON SHARE                            $ 0.13   $ 0.12   $  0.26   $  0.24
                                                               ======   ======   =======   =======
</TABLE>

The accompanying notes are an integral part of these statements.


                                        3
<PAGE>

                              UNITED BANCORP, INC.

                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                                  In thousands

<TABLE>
<CAPTION>
                                                              THREE MONTHS        SIX MONTHS
                                                             ENDED JUNE 30,     ENDED JUNE 30,
                                                            ----------------   ----------------
                                                              2006     2005      2006     2005
                                                            -------   ------   -------   ------
                                                                        (Unaudited)
<S>                                                         <C>       <C>      <C>       <C>
Net earnings                                                $   287   $  881   $   989   $1,702
Other comprehensive income (loss), net of tax:
   Unrealized holding gains (losses) on securities during
      the period, net of (taxes) benefits of $596
      $(650), $846 and $(47) for each respective period      (1,156)   1,262    (1,643)      91
   Reclassification adjustment for realized gains
      included in earnings, net of taxes of $(109),
      $(3), $(119) and $(2) for each
      respective period                                         211        6       231        4
                                                            -------   ------   -------   ------
Comprehensive income (loss)                                 $  (658)  $2,149   $  (423)  $1,797
                                                            =======   ======   =======   ======
Accumulated comprehensive loss                              $(3,835)  $ (540)  $(3,835)  $ (540)
                                                            =======   ======   =======   ======
</TABLE>

The accompanying notes are an integral part of these statements.


                                        4

<PAGE>

                              UNITED BANCORP, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                        For the six months ended June 30,
                                  In thousands

<TABLE>
<CAPTION>
                                                                  2006       2005
                                                                --------   --------
                                                                    (Unaudited)
<S>                                                             <C>        <C>
Cash flows from operating activities:
   Net earnings                                                 $    989   $  1,702
Adjustments to reconcile net earnings to net
   cash provided by (used in) operating activities:
   Depreciation and amortization                                     339        348
   Provision for loan losses                                         404        260
   Deferred taxes                                                      3       (145)
   Increase in value of bank owned life insurance                   (138)      (135)
   Federal Home Loan Bank stock dividend                            (123)       (89)
   Realized losses on sales of securities                            350          6
   Amortization of premiums and discounts on securities, net         108        214
   Realized gain on sale of loans                                    (10)       (12)
   Realized loss on sale of real estate owned                         (1)        --
   Amortization of mortgage servicing rights                          45         40
   Net change in accrued interest receivable and other assets       (412)      (668)
   Net change in accrued expenses and other liabilities            1,101         52
                                                                --------   --------
         Net cash provided by operating activities                 2,655      1,573
Cash flows used in investing activities:
   Securities available for sale:
      Sales, maturities, prepayments and calls                    11,225     25,350
      Purchases                                                  (17,536)   (12,022)
   Securities held to maturity:
      Maturities, prepayments and calls                              620        215
      Purchases                                                       --     (4,943)
   Net change in loans receivable                                 (4,727)   (11,551)
   Purchases of premises and equipment                              (122)      (118)
   Sales of premises and equipment                                    --         24
   Purchase of bank owned life insurance                              --       (382)
   Proceeds from sale of real estate owned                           160        247
                                                                --------   --------
         Net cash used in investing activities                   (10,380)    (3,180)
Cash flows provided by financing activities:
   Net change in deposits                                         14,610     13,748
   Net change in short-term borrowings                            (5,943)    (9,239)
   Principal payments on long-term debt                             (408)      (442)
   Treasury stock purchases                                         (478)      (285)
   Proceeds from issuance of common stock                            224        178
   Exercise of stock options                                          32        182
   Tax benefits related to exercise of stock options                   7        114
   Cash dividends paid on common stock                            (1,183)    (1,009)
                                                                --------   --------
         Net cash provided by financing activities                 6,861      3,247
                                                                --------   --------
Net increase (decrease) in cash and cash equivalents                (864)     1,640
Cash and cash equivalents at beginning of period                  13,877      7,581
                                                                --------   --------
Cash and cash equivalents at end of period                      $ 13,013   $  9,221
                                                                ========   ========
Supplemental disclosure of cash flow information:
   Interest paid                                                $  5,901   $  4,156
                                                                ========   ========
   Federal income taxes paid                                    $    573   $    475
                                                                ========   ========
Supplemental disclosure of noncash investing activities:
   Noncash transfer from loans to other real estate
      and repossessions                                         $     98   $     65
                                                                ========   ========
   Unrealized gains (losses) on securities designated as
      available for sale, net of related tax effects            $ (1,642)  $     95
                                                                ========   ========
</TABLE>

The accompanying notes are an integral part of these statements.


                                        5
<PAGE>

                              UNITED BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            For the six and three months ended June 30, 2006 and 2005

NOTE A - 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 financial position of United Bancorp, Inc. ("Company") at June 30, 2006, and
its results of operations and cash flows for the six and three month periods
presented herein. All such adjustments are normal and recurring in nature. The
accompanying condensed consolidated financial statements have been prepared in
accordance with the instructions for Form 10-Q and, therefore, do not purport to
contain all the necessary financial disclosures required by accounting
principles generally accepted in the United States of America that might
otherwise be necessary in the circumstances and should be read in conjunction
with the consolidated financial statements, and related notes thereto, of the
Company for the year ended December 31, 2005 included in its Annual Report on
Form 10-K. Reference is made to the accounting policies of the Company described
in the Notes to the Consolidated Financial Statements contained in its Annual
Report on Form 10-K. The Company has consistently followed these policies in
preparing this Form 10-Q.

1. Principles of Condensed Consolidation

The consolidated financial statements include the accounts of United Bancorp,
Inc. ("UNITED" or "the Company") and its wholly-owned subsidiaries, The Citizens
Savings Bank of Martins Ferry, Ohio ("CITIZENS") and The Community Bank,
Lancaster, Ohio ("COMMUNITY"), (collectively hereinafter "the Banks"). All
intercompany transactions and balances have been eliminated in consolidation.

2. Nature of Operations

The Company's revenues, operating income, and assets are almost exclusively
derived from banking. Accordingly, all of the Company's banking operations are
considered by management to be aggregated in one reportable operating segment.
Customers are mainly located in Athens, Belmont, Carroll, Fairfield, Harrison,
Hocking, and Tuscarawas Counties and the surrounding localities in northeastern,
eastern and southeastern Ohio, and include a wide range of individuals, business
and other organizations. CITIZENS conducts its business through its main office
in Martins Ferry, Ohio and nine branches in Bridgeport, Colerain, Dellroy,
Dover, Jewett, New Philadelphia, St. Clairsville, Sherrodsville, and Strasburg
Ohio. COMMUNITY conducts its business through its main office in Lancaster, Ohio
and six offices in Amesville, Glouster, Lancaster, and Nelsonville, Ohio. The
Company's primary deposit products are checking, savings, and term certificate
accounts, and its primary lending products are residential mortgage, commercial,
and installment loans. Substantially all loans are secured by specific items of
collateral including business assets, consumer assets and real estate.
Commercial loans are expected to be repaid from cash flow from operations of
businesses. Real estate loans are secured by both residential and commercial
real estate. Net interest income is affected by the relative amount of
interest-earning assets and interest-bearing liabilities and the interest
received or paid on these balances. The level of interest rates paid or received
by the Company can be significantly influenced by a number of environmental
factors, such as governmental monetary policy, that are outside of management's
control.

3. Use of Estimates

To prepare financial statements in conformity with accounting principles
generally accepted in the United States of America, 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 allowance for loan losses and fair
values of financial instruments are particularly subject to change.


                                        6

<PAGE>

                              UNITED BANCORP, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

            For the six and three months ended June 30, 2006 and 2005


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

4. Earnings Per Share

Basic earnings per common share is computed based upon the weighted-average
number of common shares outstanding during the year, less shares in the ESOP
which are unallocated and not committed to be released. At June 30, 2006, the
ESOP held 322,319 unallocated shares which were not included in weighted-average
common shares outstanding. Diluted earnings per common share include the
dilutive effect of additional potential common shares issuable under the
Company's stock option plans. Earnings and dividends per share for the six and
three months ended June 30, 2006 have been restated for the stock split in the
form of a dividend declared and distributed in the fourth quarter of 2005.

The components used in the earnings per share computations were as follows:

<TABLE>
<CAPTION>
                                                                 DOLLARS IN THOUSANDS
                                                  -------------------------------------------------
                                                     THREE MONTHS ENDED         SIX MONTHS ENDED
                                                          JUNE 30,                  JUNE 30,
                                                  -----------------------   -----------------------
                                                     2006         2005         2006         2005
                                                  ----------   ----------   ----------   ----------
<S>                                               <C>          <C>          <C>          <C>
BASIC
   Net earnings                                   $      287   $      881   $      989   $    1,702
                                                  ==========   ==========   ==========   ==========
   Weighted average common shares outstanding      4,174,484    4,188,237    4,201,512    4,177,626
                                                  ==========   ==========   ==========   ==========
   Basic earnings per common share                $     0.07   $     0.21   $     0.24   $     0.41
                                                  ==========   ==========   ==========   ==========
DILUTED
   Net earnings                                   $      287   $      881   $      989   $    1,702
                                                  ==========   ==========   ==========   ==========
   Weighted average common shares outstanding
      for basic earnings per common share          4,174,484    4,188,237    4,201,512    4,177,626
   Add: Dilutive effects of assumed exercise of
      stock options                                      573          714        1,036        1,425
                                                  ----------   ----------   ----------   ----------
   Average shares and dilutive potential
      common shares                                4,175,057    4,188,951    4,202,548    4,179,051
                                                  ==========   ==========   ==========   ==========
Diluted earnings per common share                 $     0.07   $     0.21   $     0.24   $     0.41
                                                  ==========   ==========   ==========   ==========
Number of stock options not considered in
   computing diluted earnings per share due to
   antidilutive nature                                39,092       22,042       22,042       22,042
Weighted average exercise price
   of dilutive stock options                      $    10.70   $    13.41   $    10.94   $    13.41
                                                  ==========   ==========   ==========   ==========
</TABLE>


                                        7

<PAGE>

                              UNITED BANCORP, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

            For the six and three months ended June 30, 2006 and 2005

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

5. Stock Options

The Company maintains a nonqualified stock option plan for directors and
officers. The exercise price for options granted under this plan is no less than
100% of the fair market value of the shares on the date of grant adjusted for
stock splits in the form of a dividend.

Effective January 1, 2006, the Company accounts for its stock option plan in
accordance with Statement of Financial Accounting Standards, ("SFAS") No.
123(R), "Share-Based Payment." This standard requires the Company to measure the
cost of employee services received in exchange for an award of equity
instruments based on the grant-date fair value of the award. The Company elected
to use the modified prospective transition method as permitted by SFAS No.
123(R) and therefore has not restated financial results for prior periods. The
Company will recognize compensation cost for the portion of awards for which the
requisite service period has not been rendered (unvested awards) that are
outstanding as of January 1, 2006, as the remaining service is rendered. The
after-tax compensation costs under SFAS No. 123(R) totaling $4,000 and $2,000
($6,000 and $4,000 pretax) for the six and three months ended June 30, 2006 have
been based upon the grant date fair value.

Prior to the adoption of SFAS No. 123(R), the Company presented tax benefits
resulting from the exercise of stock options as operating cash flows in the
Consolidated Statement of Cash Flows. SFAS No. 123 (R) requires that cash flows
from the exercise of stock options resulting from tax benefits in excess of
recognized cumulative compensation cost ("excess tax benefits") be classified as
financing cash flows. Tax benefits related to the exercise of stock options
totaling $7,000 and $114,000 for the six months ended June 30, 2006 and 2005
have been classified as financing activities.

Prior to January 1, 2006, the Company accounted for its stock option plan in
accordance with SFAS No. 123, "Accounting for Stock-Based Compensation,"
contains a fair value-based method for valuing stock-based compensation that
entities may use, which measures compensation cost at the grant date based on
the fair value of the award. Compensation is then recognized over the service
period, which is usually the vesting period. Alternatively, SFAS No. 123 permits
companies to continue to account for stock options and similar equity
investments under Accounting Principles Board ("APB") Opinion No. 25,
"Accounting for Stock Issued to Employees." Entities that continued to account
for stock options using APB No. 25 were required to make pro forma disclosures
of net earnings and earnings per share as if the fair value-based method of
accounting defined is SFAS No. 123 had been applied.

Prior to January 1, 2006, the Company applied APB Opinion No. 25 and related
Interpretations in accounting for it stock option plan. Accordingly, no
compensation cost has been recognized in 2005 for the plan. Had compensation
cost for the Company's stock option plan been determined based on the fair value
at the grant dates for awards under the plan consistent with the accounting
method utilized in SFAS No. 123, the Company's net earnings and earnings per
share would have been reported at the pro-forma amounts indicated in the table
below.


                                        8

<PAGE>

                              UNITED BANCORP, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

            For the six and three months ended June 30, 2006 and 2005

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

5. Stock Options (continued)

<TABLE>
<CAPTION>
                                             THREE MONTHS ENDED   SIX MONTHS ENDED
                                                JUNE 30, 2005       JUNE 30, 2005
                                             ------------------   ----------------
                                                     (Dollars in thousands)
<S>                                          <C>                  <C>
NET EARNINGS                   As reported         $ 881               $1,702
      Stock-based compensation, net of tax            (8)                 (10)
                                                   -----               ------
                                 Pro-forma         $ 873               $1,692
                                                   =====               ======
EARNINGS PER SHARE
   BASIC                       As reported          0.21               $ 0.41
      Stock-based compensation, net of tax            --                   --
                                                   -----               ------
                                 Pro-forma         $0.21               $ 0.41
                                                   =====               ======
   DILUTED                     As reported         $0.21               $ 0.41
      Stock-based compensation, net of tax            --                   --
                                                   -----               ------
                                 Pro-forma         $0.21               $ 0.41
                                                   =====               ======
</TABLE>

All share and per share prices have been restated to reflect the stock split in
the form of a dividend distributed in 2005. The fair value of each option
granted in 2005 was estimated using the Black-Scholes options pricing model with
the following assumptions; risk-free interest rate of 4.54%, dividend yield of
4.21% and expected volatility of 30.53%. No stock options were granted in 2006.
Any option not exercised within the designated timeframe will be forfeited. All
options become immediately exercisable upon retirement, death, or 9 1/2 years
after issuance, or in the event of a change in control of the Company.

The expected term of the options is based on evaluations of historical and
expected future employee exercise behavior. The risk free interest rate is based
upon the U.S. Treasury rates at the date of grant with maturity dates
approximately equal to the expected life at the grant date. Volatility is based
upon historical volatility of the Company's stock.

There are no remaining options available for grant under the Company's plan as
of June 30, 2006.


                                        9

<PAGE>

                              UNITED BANCORP, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

            For the six and three months ended June 30, 2006 and 2005

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

5. Stock Options (continued)

A summary of the status of the Company's stock option plan for the six months
ended June 30, 2006 and 2005 is presented below:

<TABLE>
<CAPTION>
                                                 2006                   2005
                                         --------------------   -------------------
                                                    WEIGHTED-             WEIGHTED-
                                                     AVERAGE               AVERAGE
                                                     EXERCISE              EXERCISE
                                          SHARES      PRICE      SHARES     PRICE
                                         --------   ---------   -------   ---------
<S>                                      <C>        <C>         <C>       <C>
Outstanding at January 1,                 94,609      $11.51    112,250     $ 8.47
Granted                                       --       14.85     11,000      13.50
Exercised                                 (2,410)       7.56    (77,408)      7.21
Forfeited                                (29,027)      11.22     (4,405)      7.21
                                         -------      ------   --------     ------
Outstanding at June 30,                   63,172      $11.33     41,437     $12.32
                                         =======      ======   ========     ======
Options exercisable at period-end          2,737      $13.11      6,335     $10.71
                                         =======      ======   ========     ======
Weighted-average fair value of options
   granted during the period                          $   --                $ 3.11
                                                      ======                ======
</TABLE>

The following table summarizes information about stock options outstanding at
June 30, 2006:

<TABLE>
<CAPTION>
             OPTIONS                    OPTIONS      REMAINING
EXERCISE   OUTSTANDING     DATE OF    EXERCISABLE   CONTRACTUAL
  PRICE     AT 6/30/06   EXPIRATION    AT 6/30/06       LIFE
--------   -----------   ----------   -----------   -----------
<S>        <C>           <C>          <C>           <C>
 $10.70       24,081      05/15/15          --       8.8 years
  11.27       17,050      01/16/15          --       8.6 years
  12.82        8,494      12/01/06       2,379        .5 years
  13.50       11,000       8/23/14          --       8.0 years
  15.02        2,547      07/07/07         358       1.0 years
</TABLE>

6. Income Taxes

The Company accounts for federal income taxes pursuant to SFAS 109, "Accounting
for Income Taxes." In accordance with SFAS No. 109, a deferred tax liability or
deferred tax asset is computed by applying the current statutory tax rates to
net taxable or deductible temporary differences between the tax basis of an
asset or liability and its reported amount in the consolidated financial
statements that will result in net taxable or deductible amounts in future
periods. Deferred tax assets are recorded only to the extent that the amount of
net deductible temporary differences or carryforward attributes may be utilized
against current period earnings, carried back against prior years' earnings,
offset against taxable temporary differences reversing in future periods, or
utilized to the extent of management's estimate of future taxable income. A
valuation allowance is provided for deferred tax assets to the extent that the
value of net deductible temporary differences and carryforward attributes
exceeds management's estimates of taxes payable on future taxable income.
Deferred tax liabilities are provided on the total amount of net temporary
differences taxable in the future.


                                       10
<PAGE>

                              UNITED BANCORP, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

            For the six and three months ended June 30, 2006 and 2005

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

6. Income Taxes (continued)

Deferred income taxes result from different methods of accounting for deferred
loan origination fees and costs, Federal Home Loan Bank stock dividends,
mortgage servicing rights, the loan loss allowance, amortization of intangibles,
deferred compensation and pension expense. Additionally, a temporary difference
is recognized for depreciation computed using accelerated methods for federal
income tax purposes.

7. Recent Accounting Pronouncements

In February 2006, the FASB issued SFAS No. 155, "Accounting for Certain Hybrid
Instruments - an amendment of FASB Statements No. 133 and 140," to simplify and
make more consistent the accounting for certain financial instruments.
Specifically, SFAS No. 155 amends SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities," to permit fair value remeasurement for any
hybrid financial instrument with an embedded derivative that otherwise would
require bifurcation, provided that the whole instrument is accounted for on a
fair value basis. SFAS No. 155 amends SFAS No. 140, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishment of Liabilities," to allow a
qualifying special purpose entity to hold a derivative instrument that pertains
to a beneficial interest other than another derivative financial instrument.

SFAS No. 155 is effective for all financial instruments acquired or issued after
the beginning of an entity's first fiscal year that begins after September 15,
2006, or January 1, 2007 as to the Corporation, with earlier application
allowed. The Corporation is currently evaluating SFAS No. 155, but does not
expect it to have a material effect on the Corporation's financial position or
results of operations.

In March 2006, the FASB issued SFAS No. 156, "Accounting for Servicing of
Financial Assets - an amendment of SFAS No. 140," to simplify the accounting for
separately recognized servicing assets and servicing liabilities. Specifically,
SFAS No. 156 amends SFAS No. 140 to require an entity to take the following
steps:

     -    Separately recognize financial assets as servicing assets or servicing
          liabilities, each time it undertakes an obligation to service a
          financial asset by entering into certain kinds of servicing contracts;

     -    Initially measure all separately recognized servicing assets and
          liabilities at fair value, if practicable, and;

     -    Separately present servicing assets and liabilities subsequently
          measured at fair value in the statement of financial position and
          additional disclosures for all separately recognized servicing assets
          and servicing liabilities.


                                       11

<PAGE>

                              UNITED BANCORP, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

            For the six and three months ended June 30, 2006 and 2005

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

7. Recent Accounting Pronouncements (continued)

Additionally, SFAS No. 156 permits, but does not require, an entity to choose
either the amortization method or the fair value measurement method for
measuring each class of separately recognized servicing assets and servicing
liabilities. SFAS No. 156 also permits a servicer that uses derivative financial
instruments to offset risks on servicing to use fair value measurement when
reporting both the derivative financial instrument and related servicing asset
or liability.

SFAS No. 156 applies to all separately recognized servicing assets and
liabilities acquired or issued after the beginning of an entity's fiscal year
that begins after September 15, 2006, or January 1, 2007 as to the Corporation,
with earlier application permitted. The Corporation is currently evaluating SFAS
No. 156, but does not expect it to have a material effect on the Corporation's
financial position or results of operations.

NOTE B - ALLOWANCE FOR LOAN LOSSES

The activity in the allowance for loan losses was as follows:

<TABLE>
<CAPTION>
                                       THREE MONTHS       SIX MONTHS
                                      ENDED JUNE 30,    ENDED JUNE 30,
                                     ---------------   ---------------
                                      2006     2005     2006     2005
                                     ------   ------   ------   ------
                                               (In thousands)
<S>                                  <C>      <C>      <C>      <C>
Beginning balance                    $2,925   $2,994   $2,904   $2,995
Provision for loan losses               302      116      404      260
Loans charged-off                      (420)     (90)    (545)    (287)
Recoveries of previous charge-offs       32       91       76      143
                                     ------   ------   ------   ------
Ending balance                       $2,839   $3,111   $2,839   $3,111
                                     ======   ======   ======   ======
</TABLE>

Nonperforming loans were as follows:

<TABLE>
<CAPTION>
                                               JUNE 30,   DECEMBER 31,
                                                 2006         2005
                                               --------   ------------
                                                    (In thousands)
<S>                                            <C>        <C>
Loans past due over 90 days still on accrual    $  574       $  417
Nonaccrual loans                                $1,533       $1,144
</TABLE>

As of June 30, 2006 and 2005, individually impaired loans were not material to
the consolidated financial statements.


                                       12

<PAGE>

                              UNITED BANCORP, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

            For the six and three months ended June 30, 2006 and 2005

NOTE C - BENEFIT PLANS

Pension expense consists of the following:

<TABLE>
<CAPTION>
                                                  THREE MONTHS      SIX MONTHS
                                                 ENDED JUNE 30,   ENDED JUNE 30,
                                                 --------------   --------------
                                                  2006   2005      2006   2005
                                                  ----   ----      ----   ----
                                                          (In thousands)
<S>                                              <C>     <C>      <C>     <C>
Service cost                                      $ 56   $ 63      $112   $126
Interest cost                                       40     39        80     78
Expected return on assets                          (43)   (38)      (86)   (76)
Amortization of prior service cost, transition
   liability, net gain, and plan amendment           7     14        14     28
                                                  ----   ----      ----   ----
Pension expense                                   $ 60   $ 78      $120   $156
                                                  ====   ====      ====   ====
</TABLE>

NOTE D - OFF-BALANCE SHEET ACTIVITIES

Some financial instruments, such as loan commitments, credit lines, letters of
credit and overdraft protection, are issued to meet customer financing needs.
These are agreements to provide credit or to support the credit of others, as
long as conditions established in the contracts are met, and usually have
expiration dates. Commitments may expire without being used. Off-balance sheet
risk to credit loss exists up to the face amount of these instruments, although
material losses are not anticipated. The same credit policies are used to make
such commitments as are used for loans, including obtaining collateral at
exercise of the commitment.

A summary of the notional or contractual amounts of financial instruments with
off-balance sheet risk at the indicated dates is as follows:

<TABLE>
<CAPTION>
                                        JUNE 30,    DECEMBER 31,
                                          2006         2005
                                      -----------   ------------
                                      (Unaudited)
                                            (In thousands)
<S>                                   <C>           <C>
Commitments to extend credit            $33,682        $29,617
Credit card and ready reserve lines       1,934          2,028
Standby letters of credit                   807            855
</TABLE>


                                       13

<PAGE>

                              UNITED BANCORP, INC.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

The following discusses the financial condition of the Company as of June 30,
2006, as compared to December 31, 2005 and the results of operations for the six
and three months ended June 30, 2006 compared to the same periods in 2005. This
discussion should be read in conjunction with the interim condensed consolidated
financial statements and related footnotes included herein.

FORWARD-LOOKING STATEMENTS

When used in this document, the words or phrases "will likely result," "are
expected to," "will continue," "is anticipated," "estimated," "projected" 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 Banks' market areas, changes in policies by
regulatory agencies, fluctuations in interest rates, demand for loans in the
Banks' market areas and competition, that could cause actual results to differ
materially from historical earnings and those presently anticipated or
projected. 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 statements expressed with respect to future periods.

The Company is not aware of any trends, events or uncertainties that will have
or are reasonably likely to have a material effect on its liquidity or capital
resources except as discussed herein. The Company is not aware of any current
recommendation by regulatory authorities that would have such effect if
implemented.

The Company does not undertake, and specifically disclaims any obligation, to
publicly revise any forward-looking statements to reflect events or
circumstances after the date such statements were made or to reflect the
occurrence of anticipated or unanticipated events.

Management makes certain judgments that affect the amounts reported in the
financial statements and footnotes. These estimates, assumptions and judgements
are based on information available as of the date of the financial statements,
and as this information changes, the financial statements could reflect
different estimates, assumptions, and judgement.

The procedures for assessing the adequacy of the allowance for loan losses
reflect our evaluation of credit risk after careful consideration of all
information available to management. In developing this assessment, management
must rely on estimates and exercise judgement regarding matters where the
ultimate outcome is unknown such as economic factors, development affecting
companies in specific industries and issues with respect to single borrowers.
Depending on changes in circumstances, future assessments of credit risk may
yield materially different results, which may require an increase or a decrease
in the allowance for loan losses.

The allowance is regularly reviewed by management to determine whether the
amount is considered adequate to absorb probable losses. This evaluation
includes specific loss estimates on certain individually reviewed loans,
statistical loss estimates for loan pools that are based on historical loss
experience, and general loss estimates that are based on the size, quality and
concentration characteristics of the various loan portfolios, adverse situations
that may affect a borrower's ability to repay and current economic and industry
conditions. Also considered as part of that judgement is a review of each bank's
trend in delinquencies and loan losses, and economic factors.

The allowance for loan losses is maintained at a level believed adequate by
management to absorb probable loan losses inherent in the loan portfolio.
Management's evaluation of the adequacy of the allowance is an estimate based on
management's current judgement about the credit quality of the loan portfolio.
While the Company strives to reflect all known risk factors in its evaluation,
judgement errors may occur.


                                       14

<PAGE>

                              UNITED BANCORP, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

Analysis of Financial Condition

Earning Assets - Loans

At June 30, 2006, gross loans were $236.3 million, compared to $232.0 million at
year-end 2005, an increase of $4.3 million or 1.8%. The increase in total
outstanding loans was the result of an increase in the commercial real estate
and installment portfolios. Management attributes the relatively strong increase
in commercial loans to the gradual strengthening of the economic environment in
the lending markets served.

Installment loans represented 17.8% of total loans at June 30, 2006 compared to
18.9% at December 31, 2005. This indirect lending type of financing carries
somewhat more risk than real estate lending, however, it also provides for
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 17 branch locations. Management has employed the strategy of
focusing on adjustable rate products for the past two years to position the
Company for a continuing increase in interest rates.

Commercial and commercial real estate loans comprised 57.9% of total loans at
June 30, 2006 compared to 56.2% at December 31, 2005. Commercial and commercial
real estate loans have increased $6.5 million or 4.9% since December 31, 2005.
The Company has originated and purchased commercial loan participations from
out-of-area banks to benefit from favorable economic growth outside the
Company's primary market area. The majority of these loans are secured by real
estate holdings comprised of hotels, motels and churches located in the Columbus
and the Akron-Canton, Ohio metropolitan areas.

Real estate loans were 24.1% of total loans at June 30, 2006 and 24.9% at
year-end 2005. Real estate loans decreased by 1.3% or $765,000 since December
31, 2005. Real estate lending for the first quarter of 2006 has been extremely
slow with respect to the Company's adjustable rate mortgage products

The allowance for loan losses represents the amount which management and the
Board of Directors estimates is adequate to provide for probable losses inherent
in the loan portfolio. The allowance balance and the provision charged to
expense are reviewed by management and the Board of Directors monthly using a
risk evaluation model that considers borrowers' past due experience, economic
conditions and various other circumstances that are subject to change over time.
Management believes the current balance of the allowance for loan losses is
adequate to absorb probable incurred credit losses associated with the loan
portfolio. Net charge-offs for the six months ended June 30, 2006 were
approximately $469,000, or 16.5%, of the beginning balance in the allowance for
loan losses.


                                       15
<PAGE>

                              UNITED BANCORP, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

Analysis of Financial Condition (continued)

Earning Assets - Securities and Federal Funds Sold

The securities portfolio is comprised of 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
estimated levels of credit risk. Securities available for sale at June 30, 2006
increased approximately $3.3 million, or 2.7% from year-end 2005 totals. During
the six months ended June 30, 2006, the Company sold approximately $11.2 million
of the securities portfolio at a loss of $350,000. The sale proceeds were
deployed to higher yielding securities whereby the loss will be recovered over a
two year period. Securities held to maturity at June 30, 2006 decreased
approximately $603,000, or 3.0% compared to year-end 2005 totals.

Sources of Funds - Deposits

The Company's primary source of funds is core deposits from retail and business
customers. These core deposits include all categories of interest-bearing and
noninterest-bearing deposits, excluding certificates of deposit greater than
$100,000. For the period ended June 30, 2006, total core deposits increased
approximately $13.8 million, or 5.2%. The Company's interest-bearing demand
deposits increased $14.1 million or 17.2%, noninterest-bearing demand deposits
increased $401,000, or 1.5%, while certificates of deposits under $100,000
increased by $2.7 million, or 2.3%. As part of a strategic focus to grow
deposits, the Company introduced a new premium rate money market index account
with a guaranteed interest rate for 180 days. In addition to paying a premium
interest rate, a debit/ATM named the "Freedom Card" is issued with the account.
The benefit of the Freedom Card is to allow our customers to use any ATM in the
continental United States without a service fee.

The Company has a strong deposit base from public agencies, including local
school districts, city and township municipalities, public works facilities and
others that 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 greater than $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, 2006, certificates of deposit greater than $100,000
increased $773,000, or 2.0%, from year-end 2005 totals.

COMMUNITY has developed several large depository customers. As of June 30, 2006,
the nine largest depository customers accounted for approximately 27.8% of
COMMUNITY'S certificate of deposits and approximately 75.7% of total
certificates of deposits greater than $100,000. These customers also represent
16.4% of COMMUNITY'S demand deposits at June 30, 2006. Total concentration of
retail funding is approximately 39.6% of COMMUNITY'S total deposits at June 30,
2006. On a consolidated level, this represents approximately 7.1% of total
retail deposits at June 30, 2006, unchanged from December 31, 2005. This deposit
concentration does pose possible liquidity and earnings risk for COMMUNITY. The
earnings risks would be triggered if COMMUNITY would be placed in a position to
sell assets below book value to meet current liquidity needs. This risk is
mitigated with COMMUNITY'S capability to borrow via wholesale funding from
correspondent banks. Management has an active asset/liability committee that
monitors, among other items, monthly liquidity needs on a 90 day time horizon.


                                       16

<PAGE>

                              UNITED BANCORP, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

Analysis of Financial Condition (continued)

Sources of Funds - Securities Sold under Agreements to Repurchase and Other
Borrowings

Other interest-bearing liabilities include securities sold under agreements to
repurchase, sweep accounts, federal funds purchased, Treasury, Tax and Loan
notes payable and Federal Home Loan Bank ("FHLB") advances. In the first six
months of 2006, the Company continued to utilize the FHLB programs to manage
interest rate risk and liquidity positions. The majority of the Company's
repurchase agreements are with local school districts and city and county
governments. Total borrowings, including federal funds purchased, decreased
approximately $6.7 million, or 9.1% from year-end 2005 totals.

Results of Operations for the Six Months Ended June 30, 2006 and 2005

Net Income

Basic and diluted earnings per share for the six months ended June 30, 2006
totaled $0.24, compared with $0.41 for the six months ended June 30, 2005. In
dollars, net income decreased by $713,000, or 41.9%, for the six months ended
June 30, 2006, compared to the same period in 2005.

On March 2, 2006, James W. Everson was appointed President and Chief Executive
Officer of The Community Bank after the bank did not meet its 2006 business plan
by posting losses in January and February. Management developed three strategic
initiatives in June aimed at enhancing future profitability of The Community
Bank and UBCP. First, The Community Bank took a charge against earnings of
approximately $330,000 relative to the bond portfolio. With our current
reinvestment strategy, management anticipates this loss to be recouped in just
slightly over two years, while the average life of the bonds sold was
approximately four years. Second, a $90,000 charge against earnings was taken to
improve the profitability and customer service related to Community's ATM and
credit card platforms. Finally, an additional $210,000 was charged in loan loss
provision expense against earnings to replenish the loan loss reserve account at
The Community Bank for loans charged off during the quarter. These actions,
which are being taken to improve UBCP's future financial performance, will have
a minimal impact on the Company's capital and are currently projected to have no
effect on its dividend policy.

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 decreased 3.3% or $216,000 for the six months ended June 30,
2006, compared to the same period in 2005, due primarily to a rising interest
rate environment that adversely impacted the Company's costs of funds.

Total interest income for the six months ended June 30, 2006 was $12.3 million,
compared to $10.7 million for the same period in 2005. Total interest income
increased $1.6 million, or 15.3%. The increase can be attributed to favorable
repricing on adjustable rate loans, and to a lesser extent, growth of the loan
portfolio.

Total interest expense for the six months ended June 30, 2006 when compared to
the same six-month period ended June 30, 2005, increased 44.8%, or $1.9 million.
The Company has experienced a significant increase in interest expense during
2006, due primarily to the negative effects of a rising interest rate
environment


                                       17

<PAGE>

                              UNITED BANCORP, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

Results of Operations for the Six Months Ended June 30, 2006 and 2005
(continued)

Provision for Loan Losses

The provision for loan losses was $404,000 for the six months ended June 30,
2006, compared to $260,000 for the same period in 2005. At June 30, 2006 the
allowance for loan losses to total gross loans was 1.20% as compared to 1.25% at
December 31, 2005. The allowance for loan losses to nonperforming loans was
134.74% at June 30, 2006, compared to 186.03% at December 31, 2005. The increase
in provision for the six month period ended June 30, 2006 is due to increased
charge-offs at the Company's COMMUNITY affiliate.

Noninterest Income

Total noninterest income is made up of bank related fees and service charges, as
well as other income producing services provided, sale of secondary market
loans, ATM income, early redemption penalties for certificates of deposit, safe
deposit rental income, internet bank service fees, earnings on bank-owned life
insurance and other miscellaneous items.

Noninterest income for the six months ended June 30, 2006 was $892,000, compared
to $1.2 million for the same six-month period ended June 30, 2005, a decrease of
approximately 22.8% or $263,000. The decline is mainly attributable to a
$350,000 realized loss on sale of securities for the six months ended June 30,
2006, compared to a $6,000 realized loss for the same period in 2005.
Management's sale strategy in June 2006 was largely predicated on a payback
period of 2 years based on reinvesting those funds in 4 year bonds at increased
interest rates.

Noninterest Expense

Noninterest expense for the six months ended June 30, 2006 increased $470,000 or
8.9% over the six months ended June 30, 2005. Salaries and employee benefits
costs increased $217,000 or 8.1% mainly due to annual merit increases and higher
costs related to the Company's benefit and insurance plans. Occupancy expense
increased $62,000 or 9.5% due to $90,000 charges related to the enhancement of
the COMMUNITY affiliates ATM and credit card platforms.

Results of Operations for the Three Months Ended June 30, 2006 and 2005

Net Income

Basic and diluted earnings per share for the three months ended June 30, 2006
totaled $0.07, compared with $0.21 for the three months ended June 30, 2005. In
dollars, net earnings decreased by $594,000, or 67.4%, for the three months
ended June 30, 2006, compared to the same quarter in 2005.

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 decreased 3.6%, or $118,000, for the three months ended June 30,
2006, compared to the same period in 2005, due primarily to continuing increases
in interest rates adversely impacting the Company's costs of funds.


                                       18

<PAGE>

                              UNITED BANCORP, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

Results of Operations for the Three Months Ended June 30, 2006 and 2005
(continued)

Net Interest Income (continued)

Total interest income for the three months ended June 30, 2006 was $6.3 million
compared to $5.4 million for the same period in 2006, an increase of $873,000,
or 16.0%. The increase can be attributed to favorable upward interest rate
adjustments, as well as overall growth of the loan portfolio from June 30, 2005
to June 30, 2006.

Total interest expense for the three months ended June 30, 2006, as compared to
the same three-month period ended June 30, 2005, increased by 45.9%, or
$991,000. The Company has experienced an increase in interest expense due to
growth in interest-bearing liabilities, as well as the effect of a higher
interest rate environment for the 2006 period, as compared to 2005.

Provision for Loan Losses

The provision for loan losses was $302,000 for the three months ended June 30,
2006 compared to $116,000 for the same period in 2005. The increase in provision
for three month period ended June 30, 2006 is primarily attributable due to
increased charge-offs during 2006 at the COMMUNITY affiliate.

Noninterest Income

Total noninterest income is made up of bank related fees and service charges, as
well as other income producing services provided, sale of secondary market
loans, ATM income, early redemption penalties for certificates of deposit, safe
deposit rental income, internet bank service fees, earnings on bank-owned life
insurance and other miscellaneous items.

Noninterest income for the three months ended June 30, 2006 was $280,000
compared to $589,000 for the same three-month period ended June 30, 2005, a
decrease of approximately 52.5%, or $309,000. The Company's security portfolio
incurred a $320,000 realized loss for the three months ended June 30, 2006,
compared to a $9,000 realized loss for the same period in 2005, resulting in a
decrease in noninterest income of $311,000 from 2005 to 2006. As stated
previously, management's strategy took into consideration a payback period of
just over 2 years by reinvesting sale proceeds in higher market interest rates.

Noninterest Expense

Noninterest expense for the three months ended June 30, 2006 increased $301,000,
or 11.4%, over the three months ended June 30, 2005. Salaries and employee
benefits expense increased $119,000 or 9.1% mainly due to annual merit increases
and higher costs related to the Company's benefit and insurance plans. Occupancy
expense increased $62,000 or 19.1% due to the aforementioned $90,000 charge to
improve the profitability and customer service related to COMMUNITY'S ATM and
credit card platforms.


                                       19

<PAGE>

                              UNITED BANCORP, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

Results of Operations for the Three Months Ended June 30, 2006 (continued)

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, 2006, totaled $30.4 million compared to $32.5 million at December 31, 2005,
a 6.3% decrease. Total shareholders' equity in relation to total assets was
7.25% at June 30, 2006 and 7.88% at December 31, 2005. In May 2001, our
shareholders approved an amendment to the Company's Articles of Incorporation to
create a class of preferred shares with 2,000,000 authorized shares. This
enables the Company, at the option of the Board of Directors, to issue series of
preferred shares in a manner calculated to take advantage of financing
techniques which may provide a lower effective cost of capital to the Company.
The amendment also provides greater flexibility to the Board of Directors in
structuring the terms of equity securities that may be issued by the Company.
Although this preferred stock is a financial tool, it has not been exercised to
date.

The Company has 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 does not represent a change in
the Company's dividend policy or a guarantee of future dividends.

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. The most important of these various
regulations address capital adequacy.

The minimums related to such capital 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 well-capitalized classification at
June 30, 2006:

<TABLE>
<CAPTION>
                                        JUNE 30, 2006
                                   ----------------------
                                         (Unaudited)
                                   (Dollars in thousands)
<S>                                <C>
Tier 1 capital                            $ 38,206
Total risk-based capital                  $ 41,045
Risk-weighted assets                      $265,104
Average total assets                      $414,632
Tier 1 capital to average assets              9.21%
Tier 1 risk-based capital ratio              14.41%
Total risk-based capital ratio               15.48%
</TABLE>


                                       20
<PAGE>

                              UNITED BANCORP, INC.

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

Results of Operations for the Three Months Ended June 30, 2006 (continued)

Liquidity

Management's objective in managing liquidity is maintaining the ability to
continue meeting 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 earnings, 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 Company has additional sources of
liquidity available to ensure that adequate funds are available as needed. These
include, but are not limited to, the purchase of federal funds, the ability to
borrow funds under line of credit agreements with correspondent banks, a
borrowing agreement with the Federal Home Loan Bank of Cincinnati and the
adjustment of interest rates to obtain depositors. Management feels that it has
the capital adequacy and profitability to meet the current and projected
liquidity needs of its customers.

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 GAAP in the United
States of America (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, impaired loans and other
real estate loans that 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 affect 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 affect
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.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There has been no significant change from disclosures included in the Company's
Annual Report on Form 10-K for the year ended December 31, 2005

Item 4. Controls and Procedures

The Company, under the supervision, and with the participation, of its
management, including the Company's Chief Executive Officer and Chief Financial
Officer, evaluated the effectiveness of the design and operation of the
Company's disclosure controls and procedures pursuant to the requirements of
Exchange Act Rule 13a-15e. Based upon that evaluation, the Chief Executive
Officer and Chief Financial Officer concluded that the Company's disclosure
controls and procedures were effective as of June 30, 2006 in timely alerting
them to material information relating to the Company (including its consolidated
subsidiaries) required to be included in the Company's periodic SEC filings.

There was no change in the Company's internal control over financial reporting
that occurred during the Company's fiscal quarter ended June 30, 2006 that has
materially affected, or is reasonably likely to materially affect, the Company's
internal control over financial reporting.


                                       21

<PAGE>

                              UNITED BANCORP, INC.

                           PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

          None other than ordinary routine litigation incidental to the
          Company's business.

ITEM 1A. RISK FACTORS

          There have been no material changes from risk factors as previously
          disclosed in Part 1 Item 1A of the Company's for 10K for the year
          ended December 31, 2005, filed on March 30, 2006.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

                      ISSUER PURCHASES OF EQUITY SECURITIES

<TABLE>
<CAPTION>
                                                                 (C)                       (D)
                                                           TOTAL NUMBER OF         MAXIMUM NUMBER (OR
                     (A)                                  SHARES (OR UNITS)     APPROXIMATE DOLLAR VALUE)
               TOTAL NUMBER OF            (B)           PURCHASED AS PART OF    OF SHARES (OR UNITS) THAT
              SHARES (OR UNITS)    AVERAGE PRICE PAID    PUBLICLY ANNOUNCED    MAY YET BE PURCHASED UNDER
PERIOD            PURCHASED       PER SHARE (OR UNIT)     PLANS OR PROGRAMS       THE PLANS OR PROGRAMS
-----------   -----------------   -------------------   --------------------   --------------------------
<S>           <C>                 <C>                   <C>                    <C>
Month #l
4/1/2006 to
4/30/2006              953               $10.70                   953                   1,550,705

Month #2
5/1/2006 to
5/31/2006             3042               $11.30                  3042                   1,516,340

Month #3
6/1/2006 to
6/30/2006           29,719               $10.98                29,719                   1,190,025
</TABLE>

United Bancorp purchased these shares under a stock purchase program publicly
announced by a press release issued on November 16, 2005, under which its Board
of Directors authorized management to cause the Company to purchase up to $2
million of its common shares over a two-year period. Such authorization will
expire on November 15, 2007.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

          Not applicable.


                                       22

<PAGE>

                              UNITED BANCORP, INC.

                     PART II - OTHER INFORMATION (CONTINUED)

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

          The annual meeting of the shareholders of United Bancorp, Inc. was
          held on April 19, 2006 for the purpose of electing three Directors to
          hold office until the annual meeting of shareholders to be held in
          2008. Proxies for the meeting were solicited pursuant to Section 14(a)
          of the Securities Exchange Act of 1934 and there was no solicitation
          in opposition to management's nominees. All of management's nominees
          for Director as listed in the proxy statement were elected by the
          votes set forth below:

<TABLE>
<CAPTION>
       Nominee             For      Withheld
       -------          ---------   --------
<S>                     <C>         <C>
Michael J. Arciello     3,714,568    66,312
Terry A. McGhee         3,731,318    49,562
L. E. Richardson, Jr.   3,748,113    32,767
</TABLE>

          Other directors whose terms continue after the Annual Meeting of
          Shareholders are James W. Everson, John M. Hoopingarner, Richard L.
          Riesbeck and Matthew C. Thomas.

ITEM 5. OTHER INFORMATION

          None

ITEM 6. EXHIBITS

<TABLE>
<CAPTION>
Exhibit No.
-----------
<S>           <C>
     3.1      Amended Articles of Incorporation of United Bancorp, Inc.(1)

     3.2      Amended Code of Regulations of United Bancorp, Inc.(2)

     4.0      Instruments Defining the Rights of Security Holders (See Exhibits
              3.1 and 3.2)

    10.1      Form of Special Severance Agreement executed by and between the
              Company and each of James W. Everson, Chairman, President & CEO;
              Randall M. Greenwood, Senior Vice President, CFO and Treasurer;
              Scott A. Everson, Senior Vice President & Chief Operating Officer;
              James A. Lodes, Vice President & Chief Lending Officer; Michael A.
              Lloyd, Vice President-Information Systems; and Norman F. Assenza,
              Jr., Vice President-Operations and Secretary(3)

    10.2      United Bancorp, Inc. and United Bancorp, Inc. Affiliate Banks
              Directors and Officers Deferred Compensation Plan, as amended(3)

    31.1      Rule 13a-14(a) Certification - CEO

    31.2      Rule 13a-14(a) Certification - CFO

    32.1      Section 1350 Certification - CEO

    32.2      Section 1350 Certification - CFO
</TABLE>

(1)  Incorporated be reference to Appendix B to the registrant's Definitive
     Proxy Statement filed with the Securities and Exchange Commission on March
     14, 2001.

(2)  Incorporated be reference to Appendix C to the registrant's Definitive
     Proxy Statement filed with the Securities and Exchange Commission on March
     14, 2001.

(3)  Incorporated by reference to the Company's current report on Form 8-K filed
     on April 26, 2006


                                       23

<PAGE>

                              UNITED BANCORP, INC.

                                   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.

                                        /s/ United Bancorp, Inc.


Date: August 14, 2006                   By: /s/ James W. Everson
                                            ------------------------------------
                                            James W. Everson
                                            Chairman, President and Chief
                                            Executive Officer


Date: August 14, 2006                   By: /s/ Randall M. Greenwood
                                            ------------------------------------
                                            Randall M. Greenwood
                                            Senior Vice President, Chief
                                            Financial Officer and Treasurer


                                       24

<PAGE>

                                  EXHIBIT INDEX

<TABLE>
<CAPTION>
Exhibit No.                               Description
-----------                               -----------
<S>           <C>
     3.1      Amended Articles of Incorporation of United Bancorp, Inc.
              (incorporated by reference to Appendix B to the registrant's
              Definitive Proxy Statement filed with the Securities and Exchange
              Commission on March 14, 2001)

     3.2      Amended Code of Regulations of United Bancorp, Inc. (incorporated
              by reference to Appendix C to the registrant's Definitive Proxy
              Statement filed with the Securities and Exchange Commission on
              March 14, 2001)

     4.0      Instruments Defining the Rights of Security Holders (See Exhibits
              3.1 and 3.2)

    10.1      Form of Special Severance Agreement executed by and between the
              Company and each of James W. Everson, Chairman, President & CEO;
              Randall M. Greenwood, Senior Vice President, CFO and Treasurer;
              Scott A. Everson, Senior Vice President & Chief Operating Officer;
              James A. Lodes, Vice President & Chief Lending Officer; Michael A.
              Lloyd, Vice President-Information Systems; and Norman F. Assenza,
              Jr., Vice President-Operations and Secretary (incorporated by
              reference to the Company's current report on Form 8-K filed on
              April 26, 2006)

    10.2      United Bancorp, Inc. and United Bancorp, Inc. Affiliate Banks
              Directors and Officers Deferred Compensation Plan, as amended
              (incorporated by reference to the Company's current report on Form
              8-K filed on April 26, 2006)

    31.1      Rule 13a-14(a) Certification - Principal Executive Officer

    31.2      Rule 13a-14(a) Certification - Principal Financial Officer

    32.1      Certification pursuant to 18 U.S.C. Section 1350, as enacted
              pursuant to Section 906 of The Sarbanes-Oxley Act of 2002

    32.2      Certification pursuant to 18 U.S.C. Section 1350, as enacted
              pursuant to Section 906 of The Sarbanes-Oxley Act of 2002
</TABLE>