We're pleased to present this 2002 Annual Report of FFD Financial Corporation
parent company of First Federal Community Bank. In April of 2001, our directors
and senior management team held a strategic planning retreat. Priorities
established as a result of the long term planning session were:

  ->   Enhance the image of the bank;

  ->   Continue our transition to becoming a strong community bank;

  ->   Expand our facilities to accommodate our growth;

  ->   Open a new branch;

  ->   Improve our data processing technology;

  ->   Reduce our reliance on more costly time deposits;

  ->   Implement a share repurchase program to deploy our excess capital; and

  ->   Plan for director succession.

All of these priorities were addressed during the past fiscal year as we built
for the future, improved shareholder value, and maintained our level of
profitability within a very challenging and difficult economy. Returns to our
shareholders this fiscal year have exceeded 35% based upon the year-to-year
change in our stock price and our dividend payments. We are very proud of this
growth in the value of your shares especially considering the returns other
companies have experienced in the capital markets. We remain focused on
increasing shareholder value through effective utilization of capital, asset
growth, profit improvement, and where possible, strategic acquisitions.

As we discussed in last year's report, we're pleased to report that we've
successfully introduced our Internet Banking and Bill Payment products, First
Federal Direct and First Federal Direct Pay. As of June 30th, 2002 we have over
400 customers using these outstanding new products that we believe hold the key
to future growth, customer retention, and cost reductions.

As you may have seen through our advertising campaign and name change, our image
within the community has been enhanced with our "First Things First" theme. This
theme reflects the way we do business and our desire to place the needs of our
customers first and foremost in our banking practices.

<PAGE>

In December 2002, we acquired a building at 902 Boulevard in Dover to become our
third branch office location. The office underwent extensive renovations and
officially opened on July 3rd, 2002. The new full-service branch office will
alleviate our space needs by housing our loan department, and will improve our
overall efficiency and distribution system.

In March of 2002, we converted our data processing platform to the Kirchman
Bankway system. The new platform provides the Bank with the opportunity to
better serve our customers with an expanded product support capability and
built-in technology and efficiency improvements.

Our deposit growth primarily consisted of core, lower cost deposits with less
reliance on higher cost time deposits. Time deposits now account for only 52% of
total deposits compared to 56% the prior year. This shift will continue to offer
net interest margin improvement.

Each of these significant accomplishments occurred during a time of economic
uncertainty and recession. Our team has worked diligently to position the Bank
for future growth and profitability during a time of rapidly declining interest
rates, flat loan demand, and increased expenses due to our investment in
technology and facilities.

It goes without saying that we are extremely proud of the team that has been
assembled at the Bank. As we have geared up for our third office, we have been
able to find some excellent additions to the First Federal team. Since customer
service is so very important in differentiating us from our competition, we take
great pride in hiring people that enjoy customers, their job, and teamwork. As
you can see from the theme of this annual report, people are our most valuable
resource. The individuals highlighted within this report are only a
representative sample of the staff dedicated to serving our most valuable asset,
our customers.

Highlights of our financial performance for fiscal 2002 include an improvement
of 7% in earnings per share from $.86 to $.92, deposit growth of 5% to over $95
million, and an increase of 105% in non-interest income. During the 2002 fiscal
year we repurchased 81,441 of the Corporation's shares. This represented 6.6% of
the outstanding stock as of July 1, 2002. This repurchase program enhances
earnings per share and book value, and reduces excess capital and improves our
return on equity. Additionally, the annual dividend rate payable to stockholders
was increased by $.02 per share. We believe our common stock continues to be a
good value, and we will continue to evaluate repurchase opportunities. The
growth in our non-interest income area will continue to be a core focus for the
company. As a direct result of the growth in core deposit accounts and our
secondary mortgage market activities, non-interest income will become an
increasingly greater percentage of our income.

<PAGE>

As we look ahead to 2003, we're excited about the growth prospects our new
branch facility, systems improvement, internet banking, and an improving economy
will provide. We're positioned to utilize the investments we made in fiscal 2002
to provide our shareholders, customers, and community "First Things First", the
trademark of excellent community bank service.

In closing, we want to pay special tribute to our retiring director, Richard J.
Herzig. Dick has been a solid, steady presence on the Board for the past 31
years. His contributions to the Bank during his tenure have aided the company in
becoming what it is today - a strong full-service community bank serving the
personal and business needs of our area. Please join us in congratulating Dick
on a job well done!

We continue to appreciate your ownership and support.


/s/E.L. Loader             /s/Trent B. Troyer

E. L. Loader               Trent B. Troyer
Chairman                   President & Chief
                           Executive Officer



<PAGE>
                      BUSINESS OF FFD FINANCIAL CORPORATION

===============================================================================

FFD Financial Corporation ("FFD" or the "Corporation") is the holding company
for First Federal Community Bank ("First Federal" or the "Bank"), a federal
savings bank.

FFD was formed in 1996 in connection with the conversion of First Federal from a
mutual savings bank to a stock savings bank (the "Conversion"). Since its
formation, FFD's activities have been limited primarily to holding the common
shares of First Federal.

First Federal is principally engaged in the business of making fixed-rate and
adjustable-rate first mortgage loans, secured by one- to four-family residential
real estate located in Tuscarawas County, Ohio, which is First Federal's primary
market area. First Federal also originates loans for the construction of
residential real estate, loans secured by multifamily real estate (over four
units), loans for commercial business purposes and nonresidential real estate
loans. The origination of consumer loans, including unsecured loans, passbook
loans, loans secured by motor vehicles and home improvement loans, constitutes a
small portion of First Federal's lending activities. In addition to originating
loans, First Federal invests in U.S. Government and agency obligations,
interest-bearing deposits in other financial institutions and mortgage-backed
securities. Funds for lending and investing activities are obtained primarily
from deposits, which are insured up to applicable limits by the Federal Deposit
Insurance Corporation ("FDIC"), from Federal Home Loan Bank ("FHLB") advances,
and from loan sales and loan and mortgage-backed securities repayments. First
Federal conducts business from three locations, two in Dover, Ohio and one in
New Philadelphia, Ohio.

FFD is subject to regulation, supervision and examination by the Office of
Thrift Supervision of the United States Department of the Treasury (the "OTS").
First Federal is subject to regulation, supervision and examination by the OTS
and the FDIC. First Federal is also a member of the FHLB of Cincinnati.
















                                       1
<PAGE>


                              MARKET PRICE OF FFD'S
                  COMMON SHARES AND RELATED SHAREHOLDER MATTERS
===============================================================================

There were 1,237,678 common shares of FFD outstanding on August 30, 2002, held
of record by approximately 620 shareholders. Price information for FFD's common
shares is quoted on the Nasdaq SmallCap Market ("Nasdaq") under the symbol
"FFDF."

The following table sets forth the high and low trading prices for the common
shares of FFD, as quoted by Nasdaq, together with the dividends declared per
share, for each quarter of fiscal 2002 and 2001.
<TABLE>
<CAPTION>
                                            High Trade          Low Trade           Cash Dividends Declared
<S>                                               <C>                <C>                        <C>
Fiscal 2001
  Quarter Ended
    September 30, 2000                          $10.75               $8.88                      $.09
    December 31, 2000                             9.75                7.75                       .09
    March 31, 2001                                9.25                7.00                       .09
    June 30, 2001                                10.75                8.38                       .09


                                            High Trade          Low Trade           Cash Dividends Declared
Fiscal 2002
 Quarter Ended
    September 30, 2001                          $11.55               $9.60                     $.095
    December 31, 2001                            12.50                9.61                      .095
    March 31, 2002                               12.25               11.95                      .095
    June 30, 2002                                14.95               11.50                      .095
</TABLE>


The income of FFD consists primarily of dividends which may periodically be
declared and paid by the Board of Directors of First Federal on the common
shares of First Federal held by FFD. In addition to certain federal income tax
considerations, OTS regulations impose limitations on the payment of dividends
and other capital distributions by savings associations. Under OTS regulations
applicable to converted savings associations, First Federal is not permitted to
pay a cash dividend on its common shares if the regulatory capital of First
Federal would, as a result of the payment of such dividend, be reduced below the
amount required for the liquidation account established in connection with the
Conversion or applicable regulatory capital requirements prescribed by the OTS.















                                       2
<PAGE>


                              SELECTED CONSOLIDATED
                      FINANCIAL INFORMATION AND OTHER DATA

===============================================================================

The following table sets forth certain information concerning the consolidated
financial condition, earnings and other data regarding FFD at the dates and for
the periods indicated.
<TABLE>
<CAPTION>
Selected consolidated financial                                            At June 30,
condition data:                                  2002           2001          2000           1999          1998
                                                                         (In thousands)
<S>                                               <C>             <C>          <C>            <C>          <C>
Total amount of:
Assets                                         $130,303        $133,097     $125,147       $112,293      $90,966
Interest-bearing deposits                        11,726           8,024        1,485          2,167          607
Investment securities available for sale -
  at market                                       2,047           1,000        2,875          2,924        2,655
Investment securities held to maturity -
  at cost                                             -               -            -              -          977
Mortgage-backed securities available
  for sale - at market                            1,551           7,799        9,135         10,978        5,935
Mortgage-backed securities held to
  maturity - at cost                              1,606           3,721        4,189          4,779        5,960
Loans receivable - net (1)                      107,055         107,467      102,939         87,382       70,990
Deposits                                         95,542          91,018       77,987         72,025       61,956
Advances from the FHLB and other
  borrowings                                     17,553          24,732       30,412         23,616       12,519

Shareholders' equity, restricted                 16,541          16,604       16,265         16,204       15,825
</TABLE>


<TABLE>
<CAPTION>
                                                                    For the year ended June 30,
Summary of earnings:                              2002           2001          2000           1999         1998
                                                              (In thousands, except per share data)
<S>                                                <C>             <C>          <C>           <C>           <C>
Interest income                                  $8,005          $9,549       $8,323         $6,915       $6,460
Interest expense                                  3,893           5,498        4,754          3,941        3,454
                                                  -----           -----        -----          -----        -----
Net interest income                               4,112           4,051        3,569          2,974        3,006

Provision for losses on loans                       150             201          106             -            -
                                                  -----           -----        -----          -----        -----
Net interest income after provision
  for losses on loans                             3,962           3,850        3,463          2,974        3,006

Other income                                        536             262          179            428          525
General, administrative and other
  expense                                         2,812           2,451        2,262          2,317        2,044
                                                  -----           -----        -----          -----        -----
Earnings before income taxes                      1,686           1,661        1,380          1,085        1,487

Federal income taxes                                573             560          458            368          505
                                                  -----           -----        -----          -----        -----

Net earnings                                     $1,113          $1,101       $  922         $  717       $  982
                                                  =====           =====        =====          =====        =====
 Earnings per share
  Basic                                            $.94            $.86         $.69           $.53         $.73
                                                    ===             ===          ===            ===          ===

  Diluted                                          $.92            $.86         $.68           $.51         $.71
                                                    ===             ===          ===            ===          ===
</TABLE>

-----------------------------------

(1)      Includes loans held for sale.






                                       3
<PAGE>

<TABLE>
<CAPTION>

Selected financial ratios                                        At or for the year ended June 30,
  and other data:                                   2002         2001          2000         1999         1998
<S>                                                  <C>          <C>          <C>           <C>          <C>
Return on average assets                            0.84%        0.86%         0.77%        0.69%        1.06%
Return on average equity                            6.75         6.69          6.07         5.11         4.65
Interest rate spread                                2.85         2.75          2.51         2.37         2.22
Net interest margin                                 3.22         3.26          3.06         2.92         3.29
General, administrative and other
  expense to average assets                         2.13         1.91          1.90         2.25         2.20
Average equity to average
  assets                                           12.50        12.81         12.75        13.59        22.75
Nonperforming assets to
  total assets                                      0.48         0.08          0.18         0.01         0.09
Nonperforming loans to total loans                  0.58         0.10          0.22         0.02         0.11
Delinquent loans to total loans (1)                 2.57         0.96          0.61         0.39         0.51
Allowance for loan losses to
  total loans                                       0.66         0.52          0.36         0.30         0.37
Allowance for loan losses to
  nonperforming loans                             114.63       537.14        166.67     1,793.33       329.27
Average interest-earning assets
  to average interest-bearing liabilities         112.05       111.49        113.53       114.24       128.34
Dividend payout ratio (2)                          40.43        41.86         49.28        56.60        41.10
Number of full service offices (3)                  3            2             2            2            2
</TABLE>

----------------------------

(1)  Delinquent  loans are loans as to which a  scheduled  payment  has not been
     made within 30 days after the due date.

(2)  Dividend payout ratio for the year ended June 30, 1998,  excludes the $4.50
     per share special capital distribution.

(3)  The Bank's third full service office opened on July 3, 2002.





















                                       4
<PAGE>


                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

===============================================================================

                                     GENERAL

-------------------------------------------------------------------------------

FFD was incorporated for the purpose of owning all of First Federal's
outstanding stock. As a result, the discussion that follows focuses on First
Federal's financial condition and results of operations. The following
discussion and analysis of the financial condition and results of operations of
FFD and First Federal should be read in conjunction with and with reference to
the consolidated financial statements, and the notes thereto, included in this
Annual Report.


       CHANGES IN FINANCIAL CONDITION FROM JUNE 30, 2001 TO JUNE 30, 2002

-------------------------------------------------------------------------------

The Corporation's assets at June 30, 2002, totaled $130.3 million, a $2.8
million, or 2.1%, decrease from the total at June 30, 2001. This decrease
resulted primarily from an $8.4 million decrease in mortgage-backed securities,
partially offset by a $4.9 million increase in cash, interest-bearing deposits
and investment securities. A $7.2 million decrease in advances from the Federal
Home Loan Bank was partially offset by an increase in deposits of $4.5 million.

Cash and interest-bearing deposits totaled $13.2 million at June 30, 2002, an
increase of $3.9 million, or 41.5%, over June 30, 2001. Interest-bearing
deposits increased by $3.7 million. Investment securities totaled $2.0 million
at June 30, 2002, an increase of $1.0 million. Maturities of investment
securities totaling $1.0 million were offset by a $2.1 million purchase of a U.
S. Government agency security.

Mortgage-backed securities totaled $3.2 million at June 30, 2002, an $8.4
million, or 72.6%, decrease from the total at June 30, 2001. This decrease
resulted from principal repayments totaling $3.2 million and sales of
mortgage-backed securities of $5.0 million. The sale of mortgage-backed
securities resulted in a realized gain of $67,000.

Loans receivable, including loans held for sale, totaled $107.1 million at June
30, 2002, a decrease of $412,000, or .4%, from the June 30, 2001 total. Loan
disbursements during fiscal 2002 totaled $51.2 million, which were offset by
principal repayments of $32.2 million and loans sold in the secondary market
totaling $19.2 million. Loan origination volume during the year ended June 30,
2002, increased by $6.4 million, or 14.4%, compared to fiscal 2001. During
fiscal 2002, management continued to meet consumer preference for fixed-rate
loans in the low interest rate environment, by selling certain lower-yielding
fixed-rate loans in the secondary market. The volume of loans sold during fiscal
2002 increased by $10.0 million, or 107.5%, over that of fiscal 2001. As a
result, the portfolio of loans secured by one- to four-family residential real
estate declined by $3.1 million to $64.6 million at June 30, 2002. Loans secured
by nonresidential real estate totaled $24.9 million at June 30, 2002, compared
to $24.6 million at June 30, 2001. Commercial loans totaled $11.3 million at
June 30, 2002, compared to $7.4 million at June 30, 2001. Nonresidential real
estate and commercial lending is generally considered to involve a higher degree
of risk than residential real estate lending due to the relatively larger loan
amounts and the effects of general economic conditions on the successful
operation of the related business or income-producing properties. The Bank has
endeavored to reduce such risk by evaluating the credit history and past
performance of the borrower, the location of the real estate, the quality of the
borrowers' management, the debt service ratio, the quality and characteristics
of the income stream generated by the business or the property and appraisals
supporting the property's valuation, as applicable.



                                       5
<PAGE>

The allowance for loan losses totaled $713,000 and $564,000 at June 30, 2002 and
2001, respectively, which represented .66% and .52% of total loans and 114.6%
and 537.1% of nonperforming loans at those respective dates. Nonperforming loans
amounted to $622,000 and $105,000 at June 30, 2002 and 2001, respectively. The
increase in nonperforming loans resulted primarily from several loans to one
borrower totaling approximately $400,000. Management believes the Bank's
nonperforming loans at June 30, 2002 are adequately collateralized and no loss
is anticipated on such loans. Although management believes that the allowance
for loan losses at June 30, 2002, was adequate based upon the available facts
and circumstances, there can be no assurance that additions to such allowance
will not be necessary in future periods, which could adversely affect the
Corporation's net earnings.

Deposits totaled $95.5 million at June 30, 2002, a $4.5 million, or 5.0%,
increase over total deposits at June 30, 2001. This increase resulted primarily
from management's efforts to generate growth through advertising and pricing
strategies. Proceeds from deposit growth were used primarily to fund new loan
originations and to repay FHLB advances during the period.

FHLB advances totaled $17.6 million at June 30, 2002, a $7.2 million, or 29.0%,
decrease from June 30, 2001. The repayment of FHLB advances was funded primarily
by the increase in deposits and proceeds from sales and repayments of
mortgage-backed securities.

Shareholders' equity totaled $16.5 million at June 30, 2002, a decrease of
$63,000, or .4%, from June 30, 2001 levels, as net earnings of $1.1 million were
offset by dividends paid totaling $446,000 and purchases of treasury shares
totaling $936,000.


                         COMPARISON OF OPERATING RESULTS
                   FOR THE YEARS ENDED JUNE 30, 2002 AND 2001

-------------------------------------------------------------------------------

The consolidated net earnings of FFD depend primarily on its level of net
interest income, which is the difference between interest earned on FFD's
interest-earning assets and the interest paid on interest-bearing liabilities.
Net interest income is substantially affected by FFD's interest rate spread,
which is the difference between the average yield earned on interest-earning
assets and the average rate paid on interest-bearing liabilities, as well as by
the average balance of interest-earning assets compared to interest-bearing
liabilities.

General. FFD's net earnings totaled $1.1 million for the fiscal year ended June
30, 2002, an increase of $12,000, or 1.1%, over the net earnings recorded in
fiscal 2001. The increase in net earnings resulted primarily from a $61,000
increase in net interest income, a $51,000 decrease in the provision for losses
on loans and a $274,000 increase in other operating income, which were partially
offset by a $361,000 increase in general, administrative and other expense and a
$13,000 increase in the provision for federal income taxes.

Net Interest Income. Total interest income decreased by $1.5 million, or 16.2%,
to a total of $8.0 million for the year ended June 30, 2002, compared to $9.5
million for the year ended June 30, 2001. Interest income on loans decreased by
$915,000, or 11.0%, due primarily to a 116 basis point decrease in the average
yield, to 6.78% in fiscal 2002, which was partially offset by a $4.4 million, or
4.2%, increase in the average loan portfolio balance outstanding year to year.
Interest income on mortgage-backed securities decreased by $458,000, or 54.1%,
due primarily to a $4.9 million, or 39.7%, decrease in the average balance
outstanding, and a 165 basis point decrease in the average yield earned on such
securities, to 5.23% in fiscal 2002. Interest income on investment securities
decreased by $128,000, or 90.1%, due primarily to a $1.9 million, or 83.2%,
decrease in the average balance outstanding and a 250 basis point decrease in
the weighted-average yield year to year. Interest income on interest-bearing
deposits decreased by $43,000, or 17.9%, due primarily to a 320 basis point
decrease in the weighted-average yield, which was partially offset by a $5.8
million, or 123.0%, increase in the average balance outstanding year to year.



                                       6
<PAGE>

Interest expense on deposits decreased by $812,000, or 20.7%, for the year ended
June 30, 2002, compared to fiscal 2001, due primarily to a decrease in the
average cost of deposits of 127 basis points, to 3.34% for fiscal 2002, which
was partially offset by an $8.1 million, or 9.5%, increase in the average
deposit portfolio balance outstanding year to year.

Interest expense on borrowings decreased by $793,000, or 50.6%, due primarily to
a $5.5 million, or 21.3%, decrease in the average balance of advances
outstanding and a 224 basis point decrease in the average cost of such
borrowings, to 3.77% in fiscal 2002. Decreases in the average yields on
interest-earning assets and the average costs of interest-bearing liabilities
were due primarily to the overall reductions in interest rates in the economy
during 2001. This low interest rate environment continued through the first six
months of 2002.

As a result of the foregoing changes in interest income and interest expense,
net interest income increased by $61,000, or 1.5%, for the fiscal year ended
June 30, 2002, compared to fiscal 2001. The interest rate spread amounted to
2.85% for the fiscal year ended June 30, 2002, compared to 2.75% for fiscal
2001, while the net interest margin was 3.22% in fiscal 2002, compared to 3.26%
in fiscal 2001.

Provision for Losses on Loans. A provision for losses on loans is charged to
earnings to bring the total allowance for loan losses to a level considered
appropriate by management based on historical loss experience, the volume and
type of lending conducted by First Federal, the status of past due principal and
interest payments, general economic conditions, particularly as such conditions
relate to First Federal's market area, and other factors related to the
collectibility of First Federal's loan portfolio. The provision for losses on
loans totaled $150,000 for the year ended June 30, 2002, a decrease of $51,000,
or 25.4%, compared to fiscal 2001. First Federal's fiscal 2002 provision was
predicated primarily on the growth in the commercial and nonresidential loan
portfolios and the increase in nonperforming loans. There can be no assurance
that the loan loss allowance of First Federal will be adequate to cover losses
on nonperforming assets in the future.

Other Income. Other income totaled $536,000 for the year ended June 30, 2002, an
increase of $274,000, or 104.6%, over the 2001 total. The increase resulted
primarily from a $115,000, or 109.5%, increase in gain on sale of loans in
fiscal 2002, a $91,000, or 57.6%, increase in other operating income and a
$67,000 gain on sale of mortgage-backed securities. The increase in gain on sale
of loans was due primarily to a $10.0 million, or 107.5%, increase in sales
volume year to year. The increase in other operating income consisted primarily
of increases in fees generated from ATM transactions, late charges on loans and
negotiable order of withdrawal ("NOW") account fees.

General, Administrative and Other Expense. General, administrative and other
expense totaled $2.8 million for the year ended June 30, 2002, an increase of
$361,000, or 14.7%, compared to fiscal 2001. The increase resulted primarily
from a $135,000, or 12.1%, increase in employee compensation and benefits, a
$58,000, or 25.6%, increase in occupancy and equipment, an $83,000, or 35.0%,
increase in data processing and a $145,000, or 21.9%, increase in other
operating expenses, which were partially offset by a $60,000, or 28.6%, decrease
in franchise taxes.

The increase in employee compensation and benefits resulted primarily from
overtime compensation paid in connection with the installation of, and training
related to, a new data processing system, as well as normal merit increases and
an increase in costs related to the employee stock ownership plan and other
benefit plans, which were partially offset by an increase in the level of
deferred loan origination costs due to the increase in loan origination volume
year to year. The increase in occupancy and equipment was due primarily to
expenses incurred in connection with the data processing conversion. The
increase in data processing expense was also due primarily to costs associated
with the data conversion, as well as increased costs associated with the Bank's
growth year to year. The conversion to the new data processing platform is
expected to facilitate the Bank's expansion of its product offerings and
accommodate future growth. The increase in other operating expense included an
increase of $52,000 in advertising costs, an increase of $22,000 in internet
banking costs and $40,000 in costs associated with NOW account processing. The



                                       7
<PAGE>

remaining $31,000 increase in other operating expense was comprised primarily of
pro-rata increases related to the Corporation's overall growth year to year. The
decrease in franchise taxes was due primarily to refund claims filed on prior
year taxes.

Federal Income Taxes. The provision for federal income taxes totaled $573,000
for the year ended June 30, 2002, an increase of $13,000, or 2.3%, over fiscal
2001. The increase resulted primarily from a $25,000, or 1.5%, increase in
earnings before taxes. The effective tax rates were 34.0% and 33.7% for the
years ended June 30, 2002 and 2001, respectively.


                         COMPARISON OF OPERATING RESULTS
                   FOR THE YEARS ENDED JUNE 30, 2001 AND 2000

-------------------------------------------------------------------------------

General. FFD's net earnings totaled $1.1 million for the fiscal year ended June
30, 2001, an increase of $179,000, or 19.4%, over the net earnings of $922,000
recorded in fiscal 2000. The increase in net earnings resulted primarily from a
$482,000 increase in net interest income and an $83,000 increase in other
operating income, which were partially offset by a $189,000 increase in general,
administrative and other expense, a $95,000 increase in the provision for losses
on loans, and a $102,000 increase in the provision for federal income taxes.

Net Interest Income. Total interest income increased by $1.2 million, or 14.7%,
to a total of $9.5 million for the year ended June 30, 2001, compared to $8.3
million for the year ended June 30, 2000. Interest income on loans increased by
$1.3 million, or 17.9%, due primarily to an $8.7 million, or 9.0%, increase in
the average loan portfolio balance outstanding, and a 60 basis point increase in
the average yield, to 7.94% in fiscal 2001. The Bank experienced an increase in
its average yield generally due to the increase in higher yielding
nonresidential real estate and commercial loans as a percent of the Bank's total
portfolio. Interest income on mortgage-backed securities decreased by $90,000,
or 9.6%, due primarily to a $2.3 million, or 15.8%, decrease in the average
balance outstanding, which was partially offset by a 47 basis point increase in
the yield earned on such securities, to 6.88% in fiscal 2001. Interest income on
investment securities and interest-bearing deposits increased by $53,000, or
16.1%, due primarily to a $1.2 million, or 20.8%, increase in the average
balance outstanding year to year.

Interest expense on deposits increased by $758,000, or 23.9%, for the year ended
June 30, 2001, compared to fiscal 2000, due primarily to an $11.0 million, or
14.8%, increase in the average deposit portfolio balance outstanding and an
increase in the average cost of 34 basis points year to year.

Interest expense on borrowings decreased by $14,000, or .9%, due primarily to a
$2.3 million, or 8.2%, decrease in the average balance of advances outstanding,
which was partially offset by a 44 basis point increase in the average cost of
such borrowings, to 6.01% in fiscal 2001.

As a result of the foregoing changes in interest income and interest expense,
net interest income increased by $482,000, or 13.5%, for the fiscal year ended
June 30, 2001, compared to fiscal 2000. The interest rate spread amounted to
2.75% for the fiscal year ended June 30, 2001, compared to 2.51% for the 2000
fiscal year, while the net interest margin was 3.26% in fiscal 2001, compared to
3.06% in fiscal 2000.

Provision for Losses on Loans. The provision for losses on loans totaled
$201,000 for the year ended June 30, 2001, an increase of $95,000, or 89.6%,
over fiscal 2000. First Federal recorded the provision during fiscal 2001
primarily due to the growth in the commercial and nonresidential loan
portfolios.

Other Income. Other income totaled $262,000 for the year ended June 30, 2001, an
increase of $83,000, or 46.4%, over the 2000 total. The increase resulted from
an $80,000, or 320.0%, increase in gain on sale of loans in fiscal 2001 and a
$4,000, or 2.6%, increase in other operating income, which were slightly offset


                                       8
<PAGE>

by a $1,000 loss on the sale of real estate acquired through foreclosure. The
increase in gain on sale of loans was due primarily to a $6.9 million, or
293.9%, increase in sales volume year to year. Other operating income consists
primarily of fees generated from ATM transactions, late charges on loans, safety
deposit box rentals and negotiable order of withdrawal ("NOW") account fees.

General, Administrative and Other Expense. General, administrative and other
expense totaled $2.5 million for the year ended June 30, 2001, an increase of
$189,000, or 8.4%, compared to fiscal 2000. The increase resulted primarily from
a $38,000, or 3.5%, increase in employee compensation and benefits, a $52,000,
or 28.1%, increase in data processing and a $105,000, or 18.8%, increase in
other operating expenses.

The increase in employee compensation and benefits resulted primarily from
normal merit increases, which were partially offset by a decrease in costs
related to stock benefit plans due to fluctuations in the fair value of the
Corporation's stock. The increase in other operating expense included an
increase of $43,000 in fees paid for outsourcing of compliance and other
consulting services and approximately $19,000 in expense related to real estate
acquired through foreclosure. The remaining $43,000 increase in other operating
expense, as well as the increase in data processing expense, were comprised
primarily of pro-rata increases related to the Corporation's overall growth year
to year.

Federal Income Taxes. The provision for federal income taxes totaled $560,000
for the year ended June 30, 2001, an increase of $102,000, or 22.3%, over fiscal
2000. The increase resulted primarily from a $281,000, or 20.4%, increase in
earnings before taxes. The effective tax rates were 33.7% and 33.2% for the
years ended June 30, 2001 and 2000, respectively.





























                                       9
<PAGE>


                  AVERAGE BALANCE, YIELD, RATE AND VOLUME DATA

-------------------------------------------------------------------------------

The following table sets forth certain information relating to FFD's average
balance sheet and reflects the average yield on interest-earning assets and the
average cost of interest-bearing liabilities for the periods indicated. Such
yields and costs are derived by dividing income or expense by the average
monthly balance of interest-earning assets or interest-bearing liabilities,
respectively, for the periods presented. Average balances are derived from
month-end balances, which include nonaccruing loans in the loan portfolio, net
of the allowance for loan losses.
<TABLE>
<CAPTION>
                                                                    Year ended June 30,
                                               2002                         2001                        2000
                                   Average   Interest            Average  Interest            Average  Interest
                                outstanding  earned/  Yield/  outstanding earned/   Yield/ outstanding earned/  Yield/
                                   balance     paid     rate     balance    paid      rate    balance    paid     rate
                                                                   (Dollars in thousands)
<S>                                   <C>       <C>       <C>      <C>       <C>        <C>      <C>       <C>      <C>
Interest-earning assets:
  Loans receivable                 $109,208   $7,406     6.78%  $104,771   $8,321      7.94%  $ 96,101   $7,058    7.34%
  Mortgage-backed securities          7,413      388     5.23     12,295      846      6.88     14,599      936    6.41
  Investment securities                 392       14     3.57      2,338      142      6.07      3,000      191    6.37
  Interest-bearing deposits
    and other                        10,563      197     1.87      4,737      240      5.07      2,858      138    4.82
                                    -------    -----     ----    -------    -----      ----    -------    -----    ----
  Total interest-earning assets     127,576    8,005     6.27    124,141    9,549      7.69    116,558    8,323    7.14

  Non-interest-earning assets         4,400                        4,412                         2,516
                                    -------                      -------                       -------

    Total assets                   $131,976                     $128,553                      $119,074
                                    =======                      =======                       =======

Interest-bearing liabilities:
  Deposits                         $ 93,311    3,118     3.34   $ 85,249    3,930      4.61   $ 74,254    3,172    4.27
  Borrowings                         20,548      775     3.77     26,094    1,568      6.01     28,413    1,582    5.57
                                    -------    -----     ----    -------    -----      ----    -------    -----    ----
    Total interest-bearing
      liabilities                   113,859    3,893     3.42    111,343    5,498      4.94    102,667    4,754    4.63
                                               -----     ----               -----      ----               -----    ----

Non-interest-bearing liabilities      1,620                          741                         1,222
                                    -------                      -------                       -------

  Total liabilities                 115,479                      112,084                       103,889

Shareholders' equity                 16,497                       16,469                        15,185
                                    -------                      -------                       -------

    Total liabilities and
      shareholders' equity         $131,976                     $128,553                      $119,074
                                    =======                      =======                       =======

Net interest income                           $4,112                       $4,051                        $3,569
                                               =====                        =====                         =====

Interest rate spread                                     2.85%                         2.75%                       2.51%
                                                         ====                          ====                        ====

Net interest margin (net interest
  income as a percent of average
  interest-earning assets)                               3.22%                         3.26%                       3.06%
                                                         ====                          ====                        ====

Average interest-earning assets to
  average interest-bearing liabilities                 112.05%                       111.49%                     113.53%
                                                       ======                        ======                      ======
</TABLE>








                                       10
<PAGE>


The table below describes the extent to which changes in interest rates and
changes in volume of interest-earning assets and interest-bearing liabilities
have affected FFD's interest income and expense during the years indicated. For
each category of interest-earning assets and interest-bearing liabilities,
information is provided on changes attributable to (i) changes in volume
(changes in volume multiplied by prior year rate), (ii) changes in rate (changes
in rate multiplied by prior year volume) and (iii) total changes in rate and
volume. The combined effects of changes in both volume and rate, which cannot be
separately identified, have been allocated proportionately to the change due to
volume and the change due to rate.
<TABLE>
<CAPTION>
                                                                        Year ended June 30,
                                                          2002 vs. 2001                      2001 vs. 2000
                                                      Increase                           Increase
                                                     (decrease)                         (decrease)
                                                       due to                             due to
                                                 Volume       Rate      Total       Volume       Rate      Total
                                                                          (In thousands)
<S>                                                <C>         <C>        <C>         <C>         <C>        <C>
Interest income attributable to:
  Loans receivable                                $341     $(1,256)    $ (915)       $661        $602     $1,263
  Mortgage-backed securities                      (286)       (172)      (458)       (156)         66        (90)
  Investment securities                            (86)        (42)      (128)        (40)         (9)       (49)
  Interest-bearing deposits and other
                                                   172        (215)       (43)         95           7        102
                                                   ---      ------      -----         ---         ---      -----
Total interest income
                                                   141      (1,685)    (1,544)        560         666      1,226
                                                   ---      ------      -----         ---         ---      -----
Interest expense attributable to:
  Deposits                                         346      (1,158)      (812)        493         265        758
  Borrowings                                      (288)       (505)      (793)       (134)        120        (14)
                                                   ---      ------      -----         ---         ---      -----
Total interest expense                              58      (1,663)    (1,605)        359         385        744
                                                   ---      ------      -----         ---         ---      -----

Increase in net interest income                   $ 83     $   (22)    $   61        $201        $281     $  482
                                                   ===      ======      =====         ===         ===      =====
</TABLE>


























                                       11
<PAGE>


                         ASSET AND LIABILITY MANAGEMENT

-------------------------------------------------------------------------------

First Federal, like other financial institutions, is subject to interest rate
risk to the extent that its interest-earning assets reprice differently than its
interest-bearing liabilities. As part of its effort to monitor and manage
interest rate risk, First Federal uses the "net portfolio value" ("NPV")
methodology adopted by the OTS. Generally, NPV is the discounted present value
of the difference between incoming cash flows on interest-earning and other
assets and outgoing cash flows on interest-bearing and other liabilities. The
application of the methodology attempts to quantify interest rate risk as the
change in the NPV which would result from a theoretical change in market
interest rates. Both an increase in market interest rates and a decrease in
market interest rates are considered.

Presented below, as of June 30, 2002 and 2001, is an analysis of First Federal's
interest rate risk as measured by changes in NPV for instantaneous and sustained
parallel shifts of 200 and 300 basis points in market interest rates. The table
also contains the policy limits set by the Board of Directors of First Federal
as the maximum change in NPV that the Board of Directors deems advisable in the
event of various changes in interest rates. Such limits have been established
with consideration of the dollar impact of various rate changes and First
Federal's strong capital position.
<TABLE>
<CAPTION>
                                                                              June 30, 2002
Change in interest rate            Board limit                      $ change               % change
    (basis points)                  % change                         in NPV                 in NPV
                                                                         (Dollars in thousands)
<S>                                  <C>                             <C>                      <C>
          +300                       +30.0%                          $1,448                   9.39%
          +200                       +20.0                            1,134                   7.35
         -                             -                                 -                    -
          -200                       -20.0                           (1,464)                 (9.49)
          -300                       -30.0                             (689)                 (4.47)


                                                                              June 30, 2001
Change in interest rate            Board limit                      $ change               % change
    (basis points)                  % change                         in NPV                 in NPV
                                                                         (Dollars in thousands)

          +300                       +30.0%                          $1,028                   7.05%
          +200                       +20.0                              993                   6.81
         -                             -                                 -                    -
          -200                       -20.0                           (1,389)                 (9.53)
          -300                       -30.0                           (1,831)                (12.56)
</TABLE>

As with any method of measuring interest rate risk, certain shortcomings are
inherent in the NPV approach. For example, although certain assets and
liabilities may have similar maturities or periods of repricing, they may react
in different degrees to changes in market interest rates. Also, the interest
rates on certain types of assets and liabilities may fluctuate in advance of
changes in market interest rates, while interest rates on other types may lag
behind changes in market rates. Further, in the event of a change in interest
rates, expected rates of prepayment on loans and mortgage-backed securities and
early withdrawal levels from certificates of deposit would likely deviate
significantly from those assumed in making the risk calculations.








                                       12
<PAGE>


                         LIQUIDITY AND CAPITAL RESOURCES

-------------------------------------------------------------------------------

First Federal's principal sources of funds are deposits, proceeds from loan
sales, loan and mortgage-backed securities repayments, maturities of securities
and other funds provided by operations. First Federal also has the ability to
borrow from the FHLB of Cincinnati. While scheduled loan repayments and maturing
investments are relatively predictable, deposit flows, loan sales and loan and
mortgage-backed securities prepayments are more influenced by interest rates,
general economic conditions and competition. First Federal maintains investments
in liquid assets based upon management's assessment of (i) the need for funds,
(ii) expected deposit flows, (iii) the yields available on short-term liquid
assets and (iv) the objectives of the asset/liability management program. At
June 30, 2002, First Federal had commitments to originate loans, including
unused lines of credit, totaling $17.7 million. Management anticipates that such
loan commitments will be funded from normal cash flows from operations and
existing excess liquidity.

Cash and cash equivalents, which is a component of liquidity, is a result of the
funds used in or provided by First Federal's operating, investing and financing
activities. These activities are summarized below for the years ended June 30,
2002, 2001 and 2000:

<TABLE>
<CAPTION>
                                                                                Year ended June 30,
                                                                       2002             2001             2000
                                                                                  (In thousands)
<S>                                                                    <C>               <C>             <C>
Net earnings                                                        $ 1,113            $1,101          $   922
Adjustments to reconcile net earnings to
  net cash from operating activities                                     42               901              608
                                                                     ------             -----           ------
Net cash from operating activities                                    1,155             2,002            1,530
Net cash from investing activities                                    6,707            (1,093)         (13,894)
Net cash from financing activities                                   (3,986)            6,012           11,772
                                                                     ------             -----           ------
Net change in cash and cash equivalents                               3,876             6,921             (592)
Cash and cash equivalents at beginning of year                        9,340             2,419            3,011
                                                                     ------             -----           ------
Cash and cash equivalents at end of year                            $13,216            $9,340          $ 2,419
                                                                     ======             =====           ======
</TABLE>

First Federal is required by applicable law and regulation to meet certain
minimum capital standards, which include a tangible capital requirement, a core
capital requirement, or leverage ratio, and a risk-based capital requirement.

The tangible capital requirement requires a savings institution to maintain
"tangible capital" of not less than 1.5% of the institution's adjusted total
assets. Tangible capital is defined in OTS regulations as core capital minus any
intangible assets.

"Core capital" is comprised of common shareholders' equity (including retained
earnings), noncumulative preferred stock and related surplus, minority interests
in consolidated subsidiaries, certain nonwithdrawable accounts and pledged
deposits of mutual associations. OTS regulations generally require savings
institutions to maintain core capital of at least 4% of the institution's total
assets, except for those institutions with the highest examination rating and
acceptable levels of risk.

OTS regulations require that savings institutions maintain "risk-based capital"
in an amount not less than 8% of risk-weighted assets. Risk-based capital is
defined as core capital plus certain additional items of capital, which for
First Federal includes a general loan loss allowance of $713,000 at June 30,
2002.








                                       13
<PAGE>

First Federal exceeded all of its capital requirements at June 30, 2002. The
following table summarizes First Federal's regulatory capital requirements and
regulatory capital at June 30, 2002:
<TABLE>
<CAPTION>
                                                                                         Excess over current
                               Regulatory capital           Current requirement              requirement
                                Amount      Percent         Amount     Percent           Amount       Percent
                             (Dollars in thousands)
<S>                              <C>        <C>               <C>        <C>              <C>         <C>
Tangible capital               $15,129      11.6%           $1,946       1.5%           $13,183      10.1%
Core capital                    15,129      11.6             5,215       4.0              9,914        7.6
Risk-based capital              15,842      17.5             7,225       8.0              8,617        9.5

</TABLE>

                   EFFECT OF RECENT ACCOUNTING PRONOUNCEMENTS

-------------------------------------------------------------------------------

In June 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards ("SFAS") No. 142 "Goodwill and Intangible
Assets," which prescribes accounting for all purchased goodwill and intangible
assets. Pursuant to SFAS No. 142, acquired goodwill is not amortized, but is
tested for impairment at the reporting unit level annually and whenever an
impairment indicator arises.

SFAS No. 142 is effective for fiscal years beginning after December 15, 2001.
The Corporation had no goodwill or other intangible assets at June 30, 2002.
Management adopted SFAS No. 142 effective July 1, 2002, as required, without
material effect on the Corporation's financial condition or results of
operations.

In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets." SFAS No. 144 carries over the recognition and
measurement provisions in SFAS No. 121. Accordingly, an entity must recognize an
impairment loss if the carrying value of a long-lived asset or asset group (a)
is not recoverable and (b) exceeds its fair value. Similar to SFAS No. 121, SFAS
No. 144 requires an entity to test an asset or asset group for impairment
whenever events or changes in circumstances indicate that its carrying amount
may not be recoverable. SFAS No. 144 differs from SFAS No. 121 in that it
provides guidance on estimating future cash flows to test recoverability. An
entity may use either a probability-weighted approach or best-estimate approach
in developing estimates of cash flows to test recoverability. SFAS No. 144 is
effective for financial statements issued for fiscal years beginning after
December 15, 2001 and interim periods within those fiscal years. Management
adopted SFAS No. 144 effective July 1, 2002, as required, without material
effect on the Corporation's financial condition or results of operations.































                                       14
<PAGE>


                         REPORT OF INDEPENDENT CERTIFIED
                             PUBLIC ACCOUNTANTS AND
                        CONSOLIDATED FINANCIAL STATEMENTS

===============================================================================

Board of Directors
FFD Financial Corporation

We have audited the accompanying consolidated statements of financial condition
of FFD Financial Corporation as of June 30, 2002 and 2001, and the related
consolidated statements of earnings, comprehensive income, shareholders' equity
and cash flows for each of the three years in the period ended June 30, 2002.
These consolidated financial statements are the responsibility of the
Corporation's management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of FFD Financial
Corporation as of June 30, 2002 and 2001, and the results of its operations and
its cash flows for each of the three years in the period ended June 30, 2002, in
conformity with accounting principles generally accepted in the United States of
America.




/s/GRANT THORNTON LLP

Cincinnati, Ohio
August 16, 2002




















                                       15
<PAGE>
                            FFD FINANCIAL CORPORATION

<TABLE>
<CAPTION>
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

                             June 30, 2002 and 2001
                        (In thousands, except share data)


         ASSETS                                                                          2002               2001
<S>                                                                                      <C>                <C>
Cash and due from banks                                                              $  1,490           $  1,316
Interest-bearing deposits in other financial institutions                              11,726              8,024
                                                                                      -------            -------
         Cash and cash equivalents                                                     13,216              9,340

Investment securities designated as available
  for sale - at market                                                                  2,047              1,000
Mortgage-backed securities designated as available for
  sale - at market                                                                      1,551              7,799
Mortgage-backed securities held to maturity - at amortized cost,
  approximate market value of $1,648 and $3,804 as of June 30,
  2002 and 2001, respectively                                                           1,606              3,721
Loans receivable - net                                                                106,718            107,227
Loans held for sale - at lower of cost or market                                          337                240
Office premises and equipment - at depreciated cost                                     1,992              1,171
Stock in Federal Home Loan Bank - at cost                                               1,885              1,786
Accrued interest receivable                                                               454                451
Prepaid expenses and other assets                                                         288                205
Prepaid federal income taxes                                                              209                157
                                                                                      -------            -------

         Total assets                                                                $130,303           $133,097
                                                                                      =======            =======

         LIABILITIES AND SHAREHOLDERS' EQUITY

Deposits                                                                             $ 95,542           $ 91,018
Advances from the Federal Home Loan Bank                                               17,553             24,732
Accrued interest payable                                                                  100                147
Other liabilities                                                                         413                397
Deferred federal income taxes                                                             154                199
                                                                                      -------            -------
         Total liabilities                                                            113,762            116,493

Commitments                                                                                -                  -

Shareholders' equity
  Preferred stock - authorized 1,000,000 shares without par
    value; no shares issued                                                                -                  -
  Common stock - authorized 5,000,000 shares without par or
    stated value; 1,454,750 shares issued                                                  -                  -
  Additional paid-in capital                                                            7,861              7,861
  Retained earnings - substantially restricted                                         11,629             10,962
  Accumulated comprehensive income; unrealized gains on securities
    designated as available for sale, net of related tax effects                           19                 55
  Shares acquired by stock benefit plans                                                 (677)              (852)
  Less 217,072 and 141,209 treasury shares at June 30, 2002 and 2001,
    respectively - at cost                                                             (2,291)            (1,422)
                                                                                      -------            -------
         Total shareholders' equity                                                    16,541             16,604
                                                                                      -------            -------

         Total liabilities and shareholders' equity                                  $130,303           $133,097
                                                                                      =======            =======
</TABLE>


The accompanying notes are an integral part of these statements.

                                       16
<PAGE>
                            FFD FINANCIAL CORPORATION
<TABLE>
<CAPTION>
                       CONSOLIDATED STATEMENTS OF EARNINGS

                     Year ended June 30, 2002, 2001 and 2000
                      (In thousands, except per share data)

                                                                                2002           2001         2000
<S>                                                                             <C>             <C>          <C>
Interest income
  Loans                                                                       $7,406         $8,321       $7,058
  Mortgage-backed securities                                                     388            846          936
  Investment securities                                                           14            142          191
  Interest-bearing deposits and other                                            197            240          138
                                                                               -----          -----        -----
         Total interest income                                                 8,005          9,549        8,323

Interest expense
  Deposits                                                                     3,118          3,930        3,172
  Borrowings                                                                     775          1,568        1,582
                                                                               -----          -----        -----
         Total interest expense                                                3,893          5,498        4,754
                                                                               -----          -----        -----

         Net interest income                                                   4,112          4,051        3,569

Provision for losses on loans                                                    150            201          106
                                                                               -----          -----        -----

         Net interest income after provision for losses on loans               3,962          3,850        3,463

Other income
  Gain on sale of loans                                                          220            105           25
  Loss on sale of real estate acquired through foreclosure                        -              (1)          -
  Gain on sale of mortgage-backed securities designated
    as available for sale                                                         67             -            -
  Other operating                                                                249            158          154
                                                                               -----          -----        -----
         Total other income                                                      536            262          179

General, administrative and other expense
  Employee compensation and benefits                                           1,249          1,114        1,076
  Occupancy and equipment                                                        285            227          229
  Franchise taxes                                                                150            210          214
  Data processing                                                                320            237          185
  Other operating                                                                808            663          558
                                                                               -----          -----        -----
         Total general, administrative and other expense                       2,812          2,451        2,262
                                                                               -----          -----        -----

         Earnings before income taxes                                          1,686          1,661        1,380

Federal income taxes
  Current                                                                        598            549          463
  Deferred                                                                       (25)            11           (5)
                                                                               -----          -----        -----
         Total federal income taxes                                              573            560          458
                                                                               -----          -----        -----

         NET EARNINGS                                                         $1,113         $1,101       $  922
                                                                               =====          =====        =====

         EARNINGS PER SHARE
           Basic                                                                $.94           $.86         $.69
                                                                                 ===            ===          ===

           Diluted                                                              $.92           $.86         $.68
                                                                                 ===            ===          ===
</TABLE>

The accompanying notes are an integral part of these statements.

                                       17
<PAGE>


                            FFD FINANCIAL CORPORATION

<TABLE>
<CAPTION>
                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

                     Year ended June 30, 2002, 2001 and 2000
                                 (In thousands)


                                                                              2002           2001           2000
<S>                                                                            <C>            <C>           <C>
Net earnings                                                                $1,113         $1,101          $ 922

Other comprehensive income (loss), net of tax:
  Unrealized holding gains (losses) on securities during
    the period, net of taxes (benefits) of $4, $201
    and $(61) in 2002, 2001 and 2000, respectively                               8            390           (119)

Reclassification adjustment for realized gains included in
  earnings, net of taxes of $23 in 2002                                        (44)            -              -
                                                                             -----          -----           ----

Comprehensive income                                                        $1,077         $1,491          $ 803
                                                                             =====          =====           ====

Accumulated comprehensive income (loss)                                     $   19         $   55          $(335)
                                                                             =====          =====           ====
</TABLE>





































The accompanying notes are an integral part of these statements.

                                       18
<PAGE>


                            FFD FINANCIAL CORPORATION
<TABLE>
<CAPTION>
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

                For the years ended June 30, 2002, 2001 and 2000
                      (In thousands, except per share data)


                                                                        Unrealized
                                                                    gains (losses)         Shares
                                                                     on securities    acquired by
                                             Additional                 designated          stock       Treasury
                                     Common     paid-in   Retained    as available        benefit        shares-
                                      stock     capital   earnings        for sale          plans        at cost           Total
<S>                                    <C>         <C>       <C>             <C>             <C>            <C>             <C>
Balance at July 1, 1999                $ -       $7,798    $ 9,850           $(216)       $(1,207)      $    (21)        $16,204

Net earnings for the year ended
  June 30, 2000                          -           -         922              -              -              -              922
Purchase of treasury shares              -           -          -               -              -            (529)           (529)
Amortization of stock benefit plan
  expense                                -           65         -               -             179             -              244
Unrealized losses on securities
  designated as available for sale,
  net of related tax effects             -           -          -             (119)            -              -             (119)
Exercise of stock options                -          (13)        -               -              -              40              27
Dividends of $.34 per share              -           -        (484)             -              -              -             (484)
                                        ---       -----     ------             ---         ------         ------        --------

Balance at June 30, 2000                 -        7,850     10,288            (335)        (1,028)          (510)         16,265

Net earnings for the year ended
  June 30, 2001                          -           -       1,101              -              -              -            1,101
Purchase of treasury shares              -           -          -               -              -            (912)           (912)
Amortization of stock benefit plan
  expense                                -           11         -               -             176             -              187
Unrealized gains on securities
  designated as available for sale,
  net of related tax effects             -           -          -              390             -              -              390
Dividends of $.36 per share              -           -        (427)             -              -              -             (427)
                                        ---       -----     ------              --         ------         ------        --------

Balance at June 30, 2001                 -        7,861     10,962              55           (852)        (1,422)         16,604

Net earnings for the year ended
  June 30, 2002                          -           -       1,113              -              -              -            1,113
Purchase of treasury shares              -           -          -               -              -            (936)           (936)
Amortization of stock benefit plan
  expense                                -           16         -               -             175             -              191
Unrealized losses on securities
  designated as available for sale,
  net of related tax effects             -           -          -              (36)            -              -              (36)
Exercise of stock options                -          (16)        -               -              -              67              51
Dividends of $.38 per share              -           -        (446)             -              -              -             (446)
                                        ---       -----     ------             ---         ------         ------        --------

Balance at June 30, 2002               $ -       $7,861    $11,629          $   19       $   (677)       $(2,291)        $16,541
                                        ===       =====     ======           =====        =======         ======          ======
</TABLE>


The accompanying notes are an integral part of these statements.

                                       19
<PAGE>
                            FFD FINANCIAL CORPORATION

<TABLE>
<CAPTION>
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                     Year ended June 30, 2002, 2001 and 2000
                                 (In thousands)

                                                                              2002           2001           2000
<S>                                                                            <C>            <C>            <C>
Cash flows from operating activities:
  Net earnings for the year                                                $ 1,113        $ 1,101        $   922
  Adjustments to reconcile net earnings to net cash
  provided by (used in) operating activities:
    Amortization of premiums and discounts
      on investments and mortgage-backed securities - net                       47             23             40
    Amortization of deferred loan origination fees                             (16)            (6)           (25)
    Gain on sale of loans                                                      (18)           (31)            (8)
    Loans originated for sale in the secondary market                      (19,307)        (8,676)        (2,206)
    Proceeds from sale of mortgage loans in the secondary market            19,228          9,288          2,358
    Loss on sale of real estate acquired through foreclosure                    -               1             -
    Depreciation and amortization                                              127            118            138
    Gain on sale of mortgage-backed securities designated as available
     for sale                                                                  (67)            -              -
    Provision for losses on loans                                              150            201            106
    Amortization of stock benefit plan expense                                 191            187            244
    Federal Home Loan Bank stock dividends                                     (99)          (134)          (104)
    Increase (decrease) in cash due to changes in:
      Accrued interest receivable                                               (3)           (22)          (100)
      Prepaid expenses and other assets                                        (83)           (24)            28
      Other liabilities                                                         16            116             31
      Accrued interest payable                                                 (47)           (55)            56
      Federal income taxes
        Current                                                                (52)           (96)            55
        Deferred                                                               (25)            11             (5)
                                                                            ------         ------         ------
         Net cash provided by operating activities                           1,155          2,002          1,530

Cash flows provided by (used in) investing activities:
  Purchase of investment securities designated as available
    for sale                                                                (2,050)            -              -
  Proceeds from maturity of investment securities                            1,000          2,000             -
  Proceeds from sale of mortgage-backed securities designated
    as available for sale                                                    5,107             -              -
  Principal repayments on mortgage-backed securities                         3,223          2,248          2,262
  Purchase of Federal Home Loan Bank stock                                      -              -            (347)
  Loan principal repayments                                                 32,238         30,639         17,338
  Loan disbursements                                                       (31,863)       (36,068)       (33,120)
  Proceeds from sale of real estate acquired through foreclosure                -             124             -
  Purchase of office premises and equipment                                   (948)           (36)           (27)
                                                                            ------         ------         ------
         Net cash provided by (used in) investing activities                 6,707         (1,093)       (13,894)
                                                                            ------         ------         ------

         Net cash provided by (used in) operating and investing
           activities (subtotal carried forward)                             7,862            909        (12,364)
                                                                            ------         ------         ------
</TABLE>


                                       20
<PAGE>
                            FFD FINANCIAL CORPORATION

<TABLE>
<CAPTION>
                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

                     Year ended June 30, 2002, 2001 and 2000
                                 (In thousands)


                                                                              2002           2001           2000
<S>                                                                           <C>             <C>            <C>
         Net cash provided by (used in) operating and investing
           activities (subtotal brought forward)                           $ 7,862        $   909       $(12,364)

Cash flows provided by (used in) financing activities:
  Net increase in deposit accounts                                           4,524         13,031          5,962
  Proceeds from Federal Home Loan Bank advances                             11,000         24,000         39,491
  Repayments of Federal Home Loan Bank advances                            (18,179)       (29,680)       (32,695)
  Proceeds from exercise of stock options                                       51             -              27
  Purchase of treasury shares                                                 (936)          (912)          (529)
  Cash dividends paid on common stock                                         (446)          (427)          (484)
                                                                            ------         ------        -------
         Net cash provided by (used in) financing activities                (3,986)         6,012         11,772
                                                                            ------         ------        -------

Net increase (decrease) in cash and cash equivalents                         3,876          6,921           (592)

Cash and cash equivalents at beginning of year                               9,340          2,419          3,011
                                                                            ------         ------        -------

Cash and cash equivalents at end of year                                   $13,216        $ 9,340       $  2,419
                                                                            ======         ======        =======


Supplemental disclosure of cash flow information:
  Cash paid during the year for:
    Federal income taxes                                                   $   250        $   651       $    442
                                                                            ======         ======        =======

    Interest on deposits and borrowings                                    $ 3,940        $ 5,553       $  4,698
                                                                            ======         ======        =======


Supplemental disclosure of noncash investing activities:
  Unrealized gains (losses) on securities designated as
    available for sale, net of applicable tax effects                      $   (36)       $   390       $   (119)
                                                                            ======         ======        =======

  Recognition of mortgage servicing rights in accordance
    with SFAS No. 140                                                      $   202        $    74       $     17
                                                                            ======         ======        =======

  Transfers from loans to real estate acquired through foreclosure         $    -         $   125       $     -
                                                                            ======         ======        =======
</TABLE>





The accompanying notes are an integral part of these statements.

                                       21
<PAGE>

                            FFD FINANCIAL CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          June 30, 2002, 2001 and 2000


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    FFD Financial Corporation (the "Corporation") is a savings and loan holding
    company whose activities are primarily limited to holding the stock of its
    wholly-owned subsidiary, First Federal Community Bank (the "Bank"). The Bank
    conducts a general banking business in north central Ohio which consists of
    attracting deposits from the general public and applying those funds to the
    origination of loans for residential, consumer and nonresidential purposes.
    The Bank's profitability is significantly dependent on net interest income,
    which is the difference between interest income generated from
    interest-earning assets (i.e. loans and investments) and the interest
    expense paid on interest-bearing liabilities (i.e. customer deposits and
    borrowed funds). 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 Bank can be significantly influenced by a number of
    environmental factors, such as governmental monetary policy, that are
    outside of management's control.

    The consolidated financial information presented herein has been prepared in
    accordance with accounting principles generally accepted in the United
    States of America ("U. S. GAAP") and general accounting practices within the
    financial services industry. In preparing consolidated financial statements
    in accordance with U. S. GAAP, management is required to make estimates and
    assumptions that affect the reported amounts of assets and liabilities and
    the disclosure of contingent assets and liabilities at the date of the
    financial statements and revenues and expenses during the reporting period.
    Actual results could differ from such estimates.

    A summary of significant accounting policies which have been consistently
    applied in the preparation of the accompanying consolidated financial
    statements follows:

    1.  Principles of Consolidation

    The accompanying consolidated financial statements include the accounts of
    the Corporation, the Bank, and the Bank's wholly-owned subsidiary, Dover
    Service Corporation ("Dover"). At June 30, 2002 and 2001, Dover's principal
    assets consisted of an investment in the stock of the Bank's data processor
    and a deposit account in the Bank. All intercompany balances and
    transactions have been eliminated in the accompanying consolidated financial
    statements.

    2.  Investment Securities and Mortgage-backed Securities

    The Corporation accounts for investment and mortgage-backed securities in
    accordance with Statement of Financial Accounting Standards ("SFAS") No. 115
    "Accounting for Certain Investments in Debt and Equity Securities." SFAS No.
    115 requires that investments be categorized as held-to-maturity, trading,
    or available for sale. Securities classified as held-to-maturity are carried
    at cost only if the Corporation has the positive intent and ability to hold
    these securities to maturity. Trading securities and securities designated
    as available for sale are carried at fair value with resulting unrealized
    gains or losses recorded to operations or shareholders' equity,
    respectively.

    Realized gains and losses on sales of securities are recognized using the
    specific identification method.



                                       22
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    3.  Loans Receivable

    Loans are stated at the principal balance outstanding, reduced by deferred
    loan origination fees and the allowance for loan losses. Interest is accrued
    as earned unless the collectibility of the loan is in doubt. Interest on
    loans that are contractually past due is charged off, or an allowance is
    established based on management's periodic evaluation. The allowance is
    established by a charge to interest income equal to all interest previously
    accrued, and income is subsequently recognized only to the extent that cash
    payments are received until, in management's judgment, the borrower's
    ability to make periodic interest and principal payments has returned to
    normal, in which case the loan is returned to accrual status. If the
    ultimate collectibility of the loan is in doubt, in whole or in part, all
    payments received on nonaccrual loans are applied to reduce principal until
    such doubt is eliminated.

    Loans held for sale are carried at the lower of cost or market, determined
    in the aggregate. In computing cost, deferred loan origination fees are
    deducted from the principal balance of the related loan. At June 30, 2002
    and 2001, loans held for sale were carried at cost.

    The Bank retains the servicing on loans sold and agrees to remit to the
    investor loan principal and interest at agreed-upon rates. The Bank
    recognizes rights to service mortgage loans for others pursuant to SFAS No.
    140, "Accounting for Transfers and Servicing of Financial Assets and
    Extinguishments of Liabilities." In accordance with SFAS No. 140, an
    institution that acquires mortgage servicing rights through either the
    purchase or origination of mortgage loans and sells those loans with
    servicing rights retained must allocate some of the cost of the loans to the
    mortgage servicing rights.

    Capitalized mortgage servicing rights and capitalized excess servicing
    receivables are required to be assessed for impairment. Impairment is
    measured based on fair value. The mortgage servicing rights recorded by the
    Bank were segregated into pools for valuation purposes, using as pooling
    criteria the loan term and coupon rate. Once pooled, each grouping of loans
    was evaluated on a discounted earnings basis to determine the present value
    of future earnings that a purchaser could expect to realize from each
    portfolio. Earnings were projected from a variety of sources including loan
    servicing fees, interest earned on float, net interest earned on escrows,
    miscellaneous income, and costs to service the loans. The present value of
    future earnings is the "economic" value for the pool, i.e., the net
    realizable present value to an acquirer of the acquired servicing.

    The Bank recorded amortization related to mortgage servicing rights totaling
    approximately $39,000, $15,000 and $10,000 for the fiscal years ended June
    30, 2002, 2001 and 2000, respectively. At June 30, 2002, the fair value and
    carrying value of the Corporation's mortgage servicing rights were $298,000
    and $287,000, respectively. At June 30, 2001, the fair value of the
    Corporation's mortgage servicing rights approximated the carrying value of
    $124,000.



                                       23
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    4.  Loan Origination Fees

    The Bank accounts for loan origination fees in accordance with SFAS No. 91
    "Accounting for Nonrefundable Fees and Costs Associated with Originating or
    Acquiring Loans and Initial Direct Costs of Leases." Pursuant to the
    provisions of SFAS No. 91, origination fees received from loans, net of
    certain direct origination costs, are deferred and amortized to interest
    income using the level-yield method, giving effect to actual loan
    prepayments. Additionally, SFAS No. 91 generally limits the definition of
    loan origination costs to the direct costs attributable to originating a
    loan, i.e., principally actual personnel costs. Fees received for loan
    commitments that are expected to be drawn upon, based on the Bank's
    experience with similar commitments, are deferred and amortized over the
    life of the loan using the level-yield method. Fees for other loan
    commitments are deferred and amortized over the loan commitment period on a
    straight-line basis.

    5.  Allowance for Loan Losses

    It is the Bank's policy to provide valuation allowances for estimated losses
    on loans based on past loan loss experience, changes in the composition of
    the loan portfolio, trends in the level of delinquent and problem loans,
    adverse situations that may affect the borrower's ability to repay, the
    estimated value of any underlying collateral and current and anticipated
    economic conditions in the primary lending area. When the collection of a
    loan becomes doubtful, or otherwise troubled, the Bank records a charge-off
    equal to the difference between the fair value of the property securing the
    loan and the loan's carrying value. Major loans and major lending areas are
    reviewed periodically to determine potential problems at an early date. The
    allowance for loan losses is increased by charges to earnings and decreased
    by charge-offs (net of recoveries).

    The Bank accounts for impaired loans in accordance with SFAS No. 114,
    "Accounting by Creditors for Impairment of a Loan," which requires that
    impaired loans be measured based upon the present value of expected future
    cash flows discounted at the loan's effective interest rate or, as an
    alternative, at the loan's observable market price or fair value of the
    collateral if the loan is collateral dependent.

    A loan is defined under SFAS No. 114 as impaired when, based on current
    information and events, it is probable that a creditor will be unable to
    collect all amounts due according to the contractual terms of the loan
    agreement. In applying the provisions of SFAS No. 114, the Bank considers
    its investment in one- to four-family residential loans and consumer
    installment loans to be homogeneous and therefore excluded from separate
    identification for evaluation of impairment. With respect to the Bank's
    investment in nonresidential, commercial and multi-family residential real
    estate loans, and its evaluation of impairment thereof, such loans are
    generally collateral-dependent and, as a result, are carried as a practical
    expedient at the lower of cost or fair value.

    Collateral-dependent loans which are more than ninety days delinquent are
    considered to constitute more than a minimum delay in repayment and are
    evaluated for impairment under SFAS No. 114 at that time.

    At June 30, 2002 and 2001, the Bank had no loans that would be defined as
    impaired under SFAS No. 114.


                                       24
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    6.  Real Estate Acquired through Foreclosure

    Real estate acquired through foreclosure is carried at the lower of the
    loan's unpaid principal balance (cost) or fair value less estimated selling
    expenses at the date of acquisition. Real estate loss provisions are
    recorded if the properties' fair value subsequently declines below the value
    determined at the recording date. In determining the lower of cost or fair
    value at acquisition, costs relating to development and improvement of
    property are capitalized. Costs relating to holding real estate acquired
    through foreclosure, net of rental income, are charged against earnings as
    incurred.

    7.  Office Premises and Equipment

    Office premises and equipment are carried at cost and include expenditures
    which extend the useful lives of existing assets. Maintenance, repairs and
    minor renewals are expensed as incurred. For financial reporting,
    depreciation and amortization are provided on the straight-line method over
    the useful lives of the assets, estimated to be between twenty and thirty
    years for buildings, ten to thirty years for building improvements and five
    to ten years for furniture and equipment. An accelerated method is used for
    tax reporting purposes.

    8.  Federal Income Taxes

    The Corporation accounts for federal income taxes pursuant to SFAS No. 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.

    The Corporation's principal temporary differences between pretax financial
    income and taxable income result primarily from the different methods of
    accounting for deferred loan origination fees, Federal Home Loan Bank stock
    dividends, general loan loss allowances, percentage of earnings bad debt
    deductions and certain components of retirement expense. A temporary
    difference is also recognized for depreciation expense computed using
    accelerated methods for federal income tax purposes.







                                       25
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    9.  Benefit Plans

    The Corporation has an Employee Stock Ownership Plan ("ESOP"), which
    provides retirement benefits for substantially all employees who have
    completed one year of service and have attained the age of 21. The
    Corporation accounts for the ESOP in accordance with Statement of Position
    ("SOP") 93-6, "Employers' Accounting for Employee Stock Ownership Plans."
    SOP 93-6 requires the measure of compensation expense recorded by employers
    to equal the fair value of ESOP shares allocated to participants during a
    fiscal year. Expense recognized related to the ESOP totaled approximately
    $155,000, $119,000 and $145,000 for the fiscal years ended June 30, 2002,
    2001 and 2000, respectively.

    Additionally, during fiscal 1997, the Bank adopted a Recognition and
    Retention Plan ("RRP"). The Bank funded the RRP through the purchase of
    40,600 shares of the Corporation's common stock in the open market. The Bank
    has awarded 31,022 shares under the RRP which vest over a five year period.
    A provision of $32,000, $66,000 and $62,000 related to the RRP was charged
    to expense for the fiscal years ended June 30, 2002, 2001 and 2000,
    respectively.

    10.  Earnings Per Share

    Basic earnings per share is computed based upon weighted-average common
    shares outstanding less shares in the ESOP which are unallocated and not
    committed to be released. Weighted-average shares outstanding gives effect
    to a reduction for 65,861, 79,035 and 92,209 unallocated shares held by the
    ESOP for the fiscal years ended June 30, 2002, 2001 and 2000, respectively.
    Diluted earnings per share is computed taking into consideration common
    shares outstanding and dilutive potential common shares to be issued under
    the Corporation's stock option plan. The computations are as follows:
<TABLE>
<CAPTION>

                                                                     2002             2001              2000
<S>                                                                   <C>              <C>               <C>
    Weighted-average common shares
      outstanding (basic)                                         1,183,697         1,278,968        1,343,818
    Dilutive effect of  assumed exercise
      of stock options                                               22,862               227           12,909
                                                                  ---------         ---------        ---------
    Weighted-average common shares
      outstanding (diluted)                                       1,206,559         1,279,195        1,356,727
                                                                  =========         =========        =========
</TABLE>

    Options to purchase 105,563 shares of common stock with a weighted-average
    exercise price of $9.24 were outstanding at June 30, 2001, but were excluded
    from the computation of common share equivalents because the exercise prices
    were greater than the average market price of the common shares.

    11.  Cash and Cash Equivalents

    For purposes of reporting cash flows, cash and cash equivalents includes
    cash and due from banks and interest-bearing deposits in other financial
    institutions with original terms to maturity of less than ninety days.





                                       26
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    12.  Fair Value of Financial Instruments

    SFAS No. 107, "Disclosures about Fair Value of Financial Instruments,"
    requires disclosure of fair value of financial instruments, both assets and
    liabilities, whether or not recognized in the consolidated statement of
    financial condition, for which it is practicable to estimate that value. For
    financial instruments where quoted market prices are not available, fair
    values are based on estimates using present value and other valuation
    methods.

    The methods used are greatly affected by the assumptions applied, including
    the discount rate and estimates of future cash flows. Therefore, the fair
    values presented may not represent amounts that could be realized in an
    exchange for certain financial instruments.

    The following methods and assumptions were used by the Corporation in
    estimating its fair value disclosures for financial instruments at June 30,
    2002 and 2001:

                  Cash and cash equivalents: The carrying amounts presented in
                  the consolidated statements of financial condition for cash
                  and cash equivalents are deemed to approximate fair value.

                  Investment and mortgage-backed securities: For investment and
                  mortgage-backed securities, fair value is deemed to equal the
                  quoted market price.

                  Loans receivable: The loan portfolio has been segregated into
                  categories with similar characteristics, such as one- to
                  four-family residential, multi-family residential and
                  nonresidential real estate. These loan categories were further
                  delineated into fixed-rate and adjustable-rate loans. The fair
                  values for the resultant loan categories were computed via
                  discounted cash flow analysis, using current interest rates
                  offered for loans with similar terms to borrowers of similar
                  credit quality. For loans on deposit accounts and consumer and
                  other loans, fair values were deemed to equal the historic
                  carrying values. The historical carrying amount of accrued
                  interest on loans is deemed to approximate fair value.

                  Federal Home Loan Bank stock: The carrying amount presented in
                  the consolidated statements of financial condition is deemed
                  to approximate fair value.

                  Deposits: The fair value of NOW accounts, passbook and club
                  accounts, and money market deposits is deemed to approximate
                  the amount payable on demand. Fair values for fixed-rate
                  certificates of deposit have been estimated using a discounted
                  cash flow calculation using the interest rates currently
                  offered for deposits of similar remaining maturities.

                  Advances from the Federal Home Loan Bank: The fair value of
                  these advances is estimated using the rates currently offered
                  for similar advances of similar remaining maturities or, when
                  available, quoted market prices.



                                       27
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    12.  Fair Value of Financial Instruments (continued)

                  Commitments to extend credit: For fixed-rate and
                  adjustable-rate loan commitments, the fair value estimate
                  considers the difference between current levels of interest
                  rates and committed rates. The difference between the fair
                  value and notional amount of outstanding loan commitments at
                  June 30, 2002 and 2001 was not material.

    Based on the foregoing methods and assumptions, the carrying value and fair
    value of the Corporation's financial instruments at June 30, 2002 and 2001
    are as follows:

<TABLE>
<CAPTION>
                                                                   2002                               2001
                                                        Carrying         Fair              Carrying         Fair
                                                           value        value                 value        value
                                                                              (In thousands)
<S>                                                       <C>           <C>                   <C>          <C>
    Financial assets
      Cash and cash equivalents                         $ 13,216     $ 13,216              $  9,340     $  9,340
      Investment securities                                2,047        2,047                 1,000        1,000
      Mortgage-backed securities                           3,157        3,199                11,520       11,603
      Loans receivable                                   107,055      105,034               107,467      106,684
      Federal Home Loan Bank stock                         1,885        1,885                 1,786        1,786
                                                         -------      -------               -------      -------

                                                        $127,360     $125,381              $131,113     $130,413
                                                         =======      =======               =======      =======

    Financial liabilities
      Deposits                                          $ 95,542     $ 92,977              $ 91,018     $ 91,518
      Advances from the Federal Home Loan Bank            17,553       17,942                24,732       24,783
                                                         -------      -------               -------      -------

                                                        $113,095     $110,919              $115,750     $116,301
                                                         =======      =======               =======      =======
</TABLE>

    13.  Advertising

    Advertising costs are expensed when incurred. The Corporation's advertising
    expense for the fiscal years ended June 30, 2002, 2001 and 2000 totaled
    $101,000, $49,000 and $56,000, respectively.

    14.  Reclassifications

    Certain prior year amounts have been reclassified to conform to the 2002
    consolidated financial statement presentation.











                                       28
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE B - INVESTMENTS AND MORTGAGE-BACKED SECURITIES

    The amortized cost, gross unrealized gains, gross unrealized losses and
    estimated fair values of investment securities at June 30, 2002 and 2001,
    are as follows:
<TABLE>
<CAPTION>
                                                                              June 30, 2002
                                                                        Gross               Gross      Estimated
                                                     Amortized     unrealized          unrealized           fair
                                                          cost          gains              losses          value
                                                                              (In thousands)
<S>                                                      <C>             <C>                 <C>            <C>
    Available for sale:
      U.S. Government agency obligations                $2,038           $  9                $ -          $2,047
                                                         =====            ===                 ===          =====

                                                                              June 30, 2001
                                                                        Gross               Gross      Estimated
                                                     Amortized     unrealized          unrealized           fair
                                                          cost          gains              losses          value
                                                                              (In thousands)
    Available for sale:
      U.S. Government agency obligations                $1,000           $ -                 $ -          $1,000
                                                         =====            ===                 ===          =====
</TABLE>

    The U. S. Government agency obligation designated as available for sale
    at June 30, 2002, is scheduled to mature in the fiscal year ended June 30,
    2011.

    The U. S. Government agency obligation designated as available for sale at
    June 30, 2001, was scheduled to mature in the fiscal year ended June 30,
    2006.

    The amortized cost, gross unrealized gains, gross unrealized losses and
    estimated fair value of mortgage-backed securities at June 30, 2002 and
    2001, are shown below:

<TABLE>
<CAPTION>
                                                                                   2002
                                                                           Gross            Gross      Estimated
                                                     Amortized        unrealized       unrealized           fair
                                                          cost             gains           losses          value
                                                                              (In thousands)
<S>                                                     <C>                <C>                <C>           <C>
    Held to maturity:
      Federal Home Loan Mortgage
        Corporation participation certificates          $1,041              $ 16             $ (1)        $1,056
      Government National Mortgage
        Association participation certificates             565                27               -             592
                                                         -----               ---              ---          -----
         Total mortgage-backed securities
           held to maturity                              1,606                43               (1)         1,648

    Available for sale:
      Federal National Mortgage
        Association participation certificates             858                11               (3)           866
      Federal Home Loan Mortgage
        Corporation participation certificates             129                -                -             129
      Government National Mortgage
        Association participation certificates             544                12               -             556
                                                         -----               ---              ---          -----
         Total mortgage-backed securities
           available for sale                            1,531                23               (3)         1,551
                                                         -----               ---              ---          -----

         Total mortgage-backed securities               $3,137              $ 66             $ (4)        $3,199
                                                         =====               ===              ===          =====
</TABLE>



                                       29
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE B - INVESTMENTS AND MORTGAGE-BACKED SECURITIES (continued)

<TABLE>
<CAPTION>
                                                                                   2001
                                                                           Gross            Gross      Estimated
                                                     Amortized        unrealized       unrealized           fair
                                                          cost             gains           losses          value
                                                                              (In thousands)
<S>                                                      <C>               <C>              <C>             <C>
    Held to maturity:
      Federal Home Loan Mortgage
        Corporation participation certificates         $ 3,397              $ 61             $ -         $ 3,458
      Government National Mortgage
        Association participation certificates             324                22               -             346
                                                        ------               ---              ---         ------
         Total mortgage-backed securities
           held to maturity                              3,721                83               -           3,804

    Available for sale:
      Federal National Mortgage
        Association participation certificates           6,509                63               -           6,572
      Federal Home Loan Mortgage
        Corporation participation certificates             161                 4               -             165
      Government National Mortgage
        Association participation certificates           1,045                17               -           1,062
                                                        ------               ---              ---         ------
         Total mortgage-backed securities
           available for sale                            7,715                84               -           7,799
                                                        ------               ---              ---         ------

         Total mortgage-backed securities              $11,436              $167             $ -         $11,603
                                                        ======               ===              ===         ======
</TABLE>

    The amortized cost of mortgage-backed securities, including those designated
    as available for sale at June 30, 2002, by contractual term to maturity are
    shown below. Expected maturities will differ from contractual maturities
    because borrowers may generally prepay obligations without prepayment
    penalties.

<TABLE>
<CAPTION>
                                                                                                     Amortized
                                                                                                       cost
                                                                                                  (In thousands)
<S>                                                                                                      <C>
    Due within five years                                                                             $   258
    Due within five to ten years                                                                          287
    Due after ten years                                                                                 2,592
                                                                                                        -----

                                                                                                       $3,137
                                                                                                        =====
</TABLE>

    As of June 30, 2002, mortgage-backed securities totaling $2.7 million were
    pledged to secure public deposits.






                                       30
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE C - LOANS RECEIVABLE

    The composition of the loan portfolio at June 30, 2002 and 2001 is as
    follows:

<TABLE>
<CAPTION>
                                                                                      2002                2001
                                                                                            (In thousands)
<S>                                                                                   <C>                <C>
    Residential real estate
      One- to four-family                                                         $ 64,560            $ 67,643
      Multi-family                                                                   5,354               7,603
    Nonresidential real estate and land                                             24,917              24,645
    Commercial loans - secured                                                      10,818               6,939
    Commercial loans - unsecured                                                       448                 471
    Consumer and other loans                                                         1,604               1,623
    Deferred loan origination costs                                                    -                     1
                                                                                   -------             -------
                                                                                   107,701             108,925
    Less:
      Undisbursed portion of loans in process                                          269               1,134
      Deferred loan origination fees                                                     1                  -
      Allowance for loan losses                                                        713                 564
                                                                                   -------             -------

                                                                                  $106,718            $107,227
                                                                                   =======             =======
</TABLE>

    The Bank's lending efforts have historically focused on one- to four-family
    and multi-family residential real estate loans, which comprise approximately
    $69.6 million, or 65%, of the total loan portfolio at June 30, 2002, and
    approximately $74.1 million, or 69%, of the total loan portfolio at June 30,
    2001. Generally, such loans have been underwritten on the basis of no more
    than an 80% loan-to-value ratio, which has historically provided the Bank
    with adequate collateral coverage in the event of default. Nevertheless, the
    Bank, as with any lending institution, is subject to the risk that real
    estate values could deteriorate in its primary lending area of north central
    Ohio, thereby impairing collateral values. However, management is of the
    belief that real estate values in the Bank's primary lending area are
    presently stable.

    As discussed previously, the Bank has sold whole loans and participating
    interests in loans in the secondary market, generally retaining servicing on
    the loans sold. Loans sold and serviced for others totaled approximately
    $31.8 million and $17.2 million at June 30, 2002 and 2001, respectively.

    In the ordinary course of business, the Bank has made loans to some of its
    directors and officers and their related business interests. In the opinion
    of management, such loans are consistent with sound lending practices and
    are within applicable regulatory lending limitations. The balance of such
    loans totaled approximately $409,000 and $298,000 at June 30, 2002 and 2001,
    respectively.






                                       31
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE D - ALLOWANCE FOR LOAN LOSSES

    The activity in the allowance for loan losses is summarized as follows for
the years ended June 30, 2002, 2001 and 2000:
<TABLE>
<CAPTION>

                                                                            2002           2001           2000
                                                                                     (In thousands)
<S>                                                                          <C>            <C>            <C>
    Beginning balance                                                       $564           $375           $269
    Provision for losses on loans                                            150            201            106
    Loan charge-offs                                                          (1)           (12)            -
                                                                             ---            ---            ---

    Ending balance                                                          $713           $564           $375
                                                                             ===            ===            ===
</TABLE>

    As of June 30, 2002, the Bank's allowance for loan losses was comprised
    solely of a general loan loss allowance, which is includible as a component
    of regulatory risk-based capital.

    Nonperforming and nonaccrual loans at June 30, 2002, 2001 and 2000, totaled
    $622,000, $105,000 and $225,000, respectively. Interest income that would
    have been recognized had nonaccrual loans performed pursuant to contractual
    terms totaled approximately $13,000, $3,000 and $12,000 for the years ended
    June 30, 2002, 2001 and 2000, respectively.


NOTE E - OFFICE PREMISES AND EQUIPMENT

    Office premises and equipment at June 30, 2002 and 2001 is comprised of the
following:

<TABLE>
<CAPTION>
                                                                                           2002           2001
                                                                                              (In thousands)
<S>                                                                                       <C>             <C>
    Land                                                                                 $  488         $  323
    Buildings and improvements                                                            1,389            844
    Furniture and equipment                                                                 851            634
                                                                                          -----          -----
                                                                                          2,728          1,801
      Less accumulated depreciation and
        amortization                                                                        736            630
                                                                                          -----          -----

                                                                                         $1,992         $1,171
                                                                                          =====          =====
</TABLE>















                                       32
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE F - DEPOSITS

    Deposits consist of the following major classifications at June 30, 2002 and
    2001:
<TABLE>
<CAPTION>

    Deposit type and weighted-                                  2002                              2001
    average interest rate                               Amount           %                 Amount         %
                                                                      (Dollars in thousands)
<S>                                                      <C>            <C>                  <C>         <C>
    Demand deposit accounts                           $  4,908          5.1%              $ 3,487          3.8%
    NOW accounts
      2002 - 0.35%                                      11,343         11.9
      2001 - 0.25%                                                                          9,995         11.0
    Passbook
      2002 - 1.59%                                      29,623         31.0
      2001 - 3.34%                                                                         26,467         29.1
                                                        ------       ------                ------        -----
    Total demand, transaction and
      passbook deposits                                 45,874         48.0                39,949         43.9

    Certificates of deposit
      Original maturities of:
        One year or less
          2002 - 2.35%                                  10,261         10.7
          2001 - 5.14%                                                                     10,025         11.0
        12 months to 36 months
          2002 - 4.46%                                  34,353         36.0
          2001 - 6.31%                                                                     35,409         38.9
      Individual retirement accounts
        2002 - 4.60%                                     5,054          5.3
        2001 - 6.07%                                                                        5,635          6.2
                                                        ------       ------                ------        -----

    Total certificates of deposit                       49,668         52.0                51,069         56.1
                                                        ------       ------                ------        -----

    Total deposit accounts                             $95,542       100.0%               $91,018        100.0%
                                                        ======       =====                 ======        =====
</TABLE>

    The Bank had certificate of deposit accounts with balances in excess of
    $100,000 totaling $7.3 million and $6.6 million at June 30, 2002 and 2001,
    respectively.

    Interest expense on deposits for the years ended June 30, 2002, 2001 and
2000 is summarized as follows:

<TABLE>
                                                                              2002           2001           2000
                                                                                       (In thousands)
<S>                                                                            <C>           <C>             <C>
    Passbook                                                                $  586         $  960         $  885
    NOW accounts                                                                36             39             68
    Certificates of deposit                                                  2,496          2,931          2,219
                                                                             -----          -----          -----

                                                                            $3,118         $3,930         $3,172
                                                                             =====          =====          =====
</TABLE>




                                       33
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE F - DEPOSITS (continued)

    Maturities of outstanding certificates of deposit at June 30, 2002 and 2001
are summarized as follows:

<TABLE>
<CAPTION>
                                                                                      2002                2001
                                                                                           (In thousands)
<S>                                                                                  <C>                  <C>
    Less than one year                                                             $29,351             $37,145
    One year to two years                                                           11,386              10,764
    Two years to three years                                                         8,931               3,160
                                                                                    ------              ------

                                                                                   $49,668             $51,069
                                                                                    ======              ======
</TABLE>


NOTE G - ADVANCES FROM THE FEDERAL HOME LOAN BANK

    Advances from the Federal Home Loan Bank, collateralized at June 30, 2002 by
    a pledge of certain residential mortgage loans totaling $22.0 million and
    the Bank's investment in Federal Home Loan Bank stock, are summarized as
    follows:
<TABLE>
<CAPTION>

    Interest                    Maturing in year
    rate                        ending June 30,                                       2002                2001
                                                                                        (Dollars in thousands)
<S>                                  <C>                                             <C>                 <C>
    5.52%                            2002                                          $    -              $ 4,000
    1.77%                            2004                                            2,500                  -
    3.90% - 8.15%                    2005                                                8               2,512
    5.06% - 5.65%                    2009                                            5,727               5,814
    1.94% - 6.10%                    After 2009                                      9,318              12,406
                                                                                    ------              ------

                                                                                   $17,553             $24,732
                                                                                    ======              ======

    Weighted-average interest rate                                                    3.67%               4.78%
                                                                                      ====                ====
</TABLE>

NOTE H - FEDERAL INCOME TAXES

    Federal income taxes differ from the amounts computed at the statutory
    corporate tax rate for the years ended June 30, 2002, 2001 and 2000 as
    follows:
<TABLE>
<CAPTION>
                                                                            2002           2001           2000
                                                                                  (Dollars in thousands)
<S>                                                                          <C>           <C>            <C>
    Federal income taxes at statutory rate                                  $573           $565           $469
    Increase (decrease) in taxes resulting primarily from:
      Nontaxable interest income                                              (4)            (6)           (11)
      Other                                                                    4              1             -
                                                                             ---            ---            ---
    Federal income taxes per consolidated
      financial statements                                                  $573           $560           $458
                                                                             ===            ===            ===

    Effective tax rate                                                     34.0%           33.7%          33.2%
                                                                           ====            ====           ====
</TABLE>



                                       34
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE H - FEDERAL INCOME TAXES (continued)

    The composition of the Corporation's net deferred tax liability at June 30,
2002 and 2001 is as follows:

<TABLE>
<CAPTION>
    Taxes (payable) refundable on temporary                                              2002             2001
    differences at statutory rate:                                                           (In thousands)
<S>                                                                                      <C>              <C>
    Deferred tax assets:
      Retirement expense                                                                $  72            $  44
      General loan loss allowance                                                         243              192
      Other                                                                                 6                2
                                                                                         ----             ----
         Deferred tax assets                                                              321              238

    Deferred tax liabilities:
      Deferred loan origination costs                                                     (54)             (66)
      Federal Home Loan Bank stock dividends                                             (255)            (222)
      Difference between book and tax depreciation                                        (35)             (38)
      Unrealized gains on securities designated as available
        for sale                                                                          (10)             (29)
      Percentage of earnings bad debt deduction                                           (24)             (40)
      Mortgage servicing rights                                                           (97)             (42)
                                                                                         ----             ----
         Deferred tax liabilities                                                        (475)            (437)
                                                                                         ----             ----

         Net deferred tax liability                                                     $(154)           $(199)
                                                                                         ====             ====
</TABLE>

    Prior to fiscal 1997, the Bank was allowed a special bad debt deduction
    generally limited to 8% of otherwise taxable income and subject to certain
    limitations based on aggregate loans and deposit account balances at the end
    of the year. If the amounts that qualified as deductions for federal income
    taxes are later used for purposes other than bad debt losses, including
    distributions in liquidation, such distributions will be subject to federal
    income taxes at the then current corporate income tax rate. Retained
    earnings at June 30, 2002, include approximately $1.7 million for which
    federal income taxes have not been provided. The amount of unrecognized
    deferred tax liability relating to the cumulative bad debt deduction was
    approximately $550,000 at June 30, 2002.

    The Bank is required to recapture as taxable income approximately $281,000
    of its tax bad debt reserve, which represents the post-1987 additions to the
    reserve, and will be unable to utilize the percentage of earnings method to
    compute its bad debt deduction in the future. The Bank has provided deferred
    taxes for this amount and began to amortize the recapture of the bad debt
    reserve into taxable income over a six year period in fiscal 1998.










                                       35
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE I - LOAN COMMITMENTS

    The Bank is a party to financial instruments with off-balance-sheet risk in
    the normal course of business to meet the financing needs of its customers,
    including commitments to extend credit. Such commitments involve, to varying
    degrees, elements of credit and interest-rate risk in excess of the amount
    recognized in the consolidated statement of financial condition. The
    contract or notional amounts of the commitments reflect the extent of the
    Bank's involvement in such financial instruments.

    The Bank's exposure to credit loss in the event of nonperformance by the
    other party to the financial instrument for commitments to extend credit is
    represented by the contractual notional amount of those instruments. The
    Bank uses the same credit policies in making commitments and conditional
    obligations as those utilized for on-balance-sheet instruments.

    At June 30, 2002, the Bank had outstanding commitments of approximately $4.1
    million to originate loans. Additionally, the Bank was obligated under
    unused lines of credit under home equity loans totaling $9.6 million and
    unused lines of credit under commercial loans of $4.0 million. In the
    opinion of management, all loan commitments equaled or exceeded prevailing
    market interest rates as of June 30, 2002, and will be funded from normal
    cash flow from operations.


NOTE J - REGULATORY CAPITAL

    The Bank is subject to minimum regulatory capital standards promulgated by
    the Office of Thrift Supervision (the "OTS"). Failure to meet minimum
    capital requirements can initiate certain mandatory -- and possibly
    additional discretionary -- actions by regulators that, if undertaken, could
    have a direct material effect on the consolidated financial statements.
    Under capital adequacy guidelines and the regulatory framework for prompt
    corrective action, the Bank must meet specific capital guidelines that
    involve quantitative measures of the Bank's assets, liabilities, and certain
    off-balance-sheet items as calculated under regulatory accounting practices.
    The Bank's capital amounts and classification are also subject to
    qualitative judgments by the regulators about components, risk weightings,
    and other factors.

    The minimum capital standards of the OTS generally require the maintenance
    of regulatory capital sufficient to meet each of three tests, hereinafter
    described as the tangible capital requirement, the core capital requirement
    and the risk-based capital requirement. The tangible capital requirement
    provides for minimum tangible capital (defined as shareholders' equity less
    all intangible assets) equal to 1.5% of adjusted total assets. The core
    capital requirement provides for minimum core capital (tangible capital plus
    certain forms of supervisory goodwill and other qualifying intangible
    assets) generally equal to 4.0% of adjusted total assets, except for those
    associations with the highest examination rating and acceptable levels of
    risk. The risk-based capital requirement provides for the maintenance of
    core capital plus general loss allowances equal to 8.0% of risk-weighted
    assets. In computing risk-weighted assets, the Bank multiplies the value of
    each asset on its statement of financial condition by a defined
    risk-weighting factor, e.g., one- to four-family residential loans carry a
    risk-weighted factor of 50%.



                                       36
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE J - REGULATORY CAPITAL (continued)

    During the 2002 fiscal year, the Bank was notified by the OTS that it was
    categorized as "well-capitalized" under the regulatory framework for prompt
    corrective action. To be categorized as "well-capitalized" the Bank must
    maintain minimum capital ratios as set forth in the following tables.

    As of June 30, 2002 and 2001, management believes that the Bank met all
    capital adequacy requirements to which it was subject.
<TABLE>
<CAPTION>
                                                                As of June 30, 2002
                                                                                                 To be "well-
                                                                                              capitalized" under
                                                                     For capital               prompt corrective
                                             Actual                adequacy purposes          action provisions
                                         Amount    Ratio           Amount    Ratio             Amount     Ratio
                                                               (Dollars in thousands)
<S>                                       <C>       <C>            <C>        <C>               <C>         <C>
    Tangible capital                    $15,129    11.6%         =>$1,956    =>1.5%          =>$6,519     => 5.0%

    Core capital                        $15,129    11.6%         =>$5,215    =>4.0%          =>$7,822     => 6.0%

    Risk-based capital                  $15,842    17.5%         =>$7,225    =>8.0%          =>$9,031     =>10.0%
</TABLE>


<TABLE>
<CAPTION>
                                                                As of June 30, 2001
                                                                                                 To be "well-
                                                                                              capitalized" under
                                                                     For capital               prompt corrective
                                             Actual                adequacy purposes          action provisions
                                         Amount    Ratio           Amount    Ratio             Amount     Ratio
                                                               (Dollars in thousands)
<S>                                        <C>     <C>              <C>       <C>               <C>         <C>
    Tangible capital                    $14,733    11.2%         =>$1,980    =>1.5%          =>$6,599     => 5.0%

    Core capital                        $14,733    11.2%         =>$5,279    =>4.0%          =>$7,919     => 6.0%

    Risk-based capital                  $15,297    16.6%         =>$7,366    =>8.0%          =>$9,207     =>10.0%
</TABLE>

    The Bank's management believes that, under the current regulatory capital
    regulations, the Bank will continue to meet its minimum capital requirements
    in the foreseeable future. However, events beyond the control of the Bank,
    such as increased interest rates or a downturn in the economy in the Bank's
    market area, could adversely affect future earnings and, consequently, the
    ability to meet future minimum regulatory capital requirements.






                                       37
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE K- CONDENSED FINANCIAL STATEMENTS OF FFD FINANCIAL CORPORATION

    The following condensed financial statements summarize the financial
    position of FFD Financial Corporation as of June 30, 2002 and 2001, and the
    results of its operations and its cash flows for the years ended June 30,
    2002, 2001 and 2000.

                            FFD FINANCIAL CORPORATION
<TABLE>
<CAPTION>
                        STATEMENTS OF FINANCIAL CONDITION
                             June 30, 2002 and 2001
                                 (In thousands)

         ASSETS                                                                          2002               2001
<S>                                                                                    <C>                  <C>
    Cash and due from banks                                                           $   532            $   924
    Loan receivable from ESOP                                                             635                740
    Investment in First Federal Community Bank                                         15,176             14,800
    Accrued interest receivable                                                            12                 12
    Prepaid federal income taxes                                                          181                125
    Prepaid expenses and other assets                                                       5                  3
                                                                                       ------             ------

         Total assets                                                                 $16,541            $16,604
                                                                                       ======             ======

         SHAREHOLDERS' EQUITY

    Shareholders' equity
      Common stock and additional paid-in capital                                     $ 7,861            $ 7,861
      Retained earnings                                                                11,629             10,962
      Unrealized gains on securities designated as available
        for sale, net of related tax effects                                               19                 55
      Shares acquired by stock benefit plans                                             (677)              (852)
      Treasury shares - at cost                                                        (2,291)            (1,422)
                                                                                       ------             ------

         Total shareholders' equity                                                   $16,541            $16,604
                                                                                       ======             ======
</TABLE>












                                       38
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000

NOTE K - CONDENSED FINANCIAL STATEMENTS OF FFD FINANCIAL CORPORATION (continued)

                            FFD FINANCIAL CORPORATION
<TABLE>
<CAPTION>
                             STATEMENTS OF EARNINGS
                     Year ended June 30, 2002, 2001 and 2000
                                 (In thousands)

                                                                                2002             2001              2000
<S>                                                                            <C>               <C>               <C>
    Revenue
      Interest income                                                         $   30           $   34            $   60
      Equity in earnings of subsidiary                                         1,221            1,233             1,002
                                                                               -----            -----             -----
         Total revenue                                                         1,251            1,267             1,062

    General and administrative expenses                                          194              234               181
                                                                               -----            -----             -----

         Earnings before income tax credits                                    1,057            1,033               881

    Federal income tax credits                                                   (56)             (68)              (41)
                                                                               -----            -----             -----

         NET EARNINGS                                                         $1,113           $1,101            $  922
                                                                               =====            =====             =====
</TABLE>


                            FFD FINANCIAL CORPORATION
<TABLE>
<CAPTION>
                            STATEMENTS OF CASH FLOWS
                     Year ended June 30, 2002, 2001 and 2000
                                 (In thousands)


                                                                                2002             2001              2000
<S>                                                                             <C>              <C>               <C>
    Cash provided by (used in) operating activities:
      Net earnings for the year                                               $1,113           $1,101            $  922
      Adjustments to reconcile net earnings to net
      cash provided by (used in) operating activities:
        Distributions from subsidiary in excess of earnings                       -               967                -
        Undistributed earnings of subsidiary                                    (221)              -             (1,001)
        Increase (decrease) in cash due to changes in:
          Prepaid expenses and other assets                                       (2)              29               (13)
          Prepaid federal income taxes                                           (56)             (68)               15
                                                                               -----            -----             -----
          Net cash provided by (used in) operating activities                    834            2,029               (77)

    Cash flows provided by investing activities:
      Proceeds from repayment of loan to ESOP                                    105               98                93

    Cash flows provided by (used in) financing activities:
      Proceeds from other borrowed money                                          -               225                -
      Repayments of other borrowed money                                          -              (225)               -
      Proceeds from exercise of stock options                                     51               -                 27
      Purchase of treasury shares                                               (936)            (912)             (529)
      Cash dividends paid on common stock                                       (446)            (427)             (484)
                                                                               -----            -----             -----
          Net cash used in financing activities                               (1,331)          (1,339)             (986)
                                                                               -----            -----             -----

    Net increase (decrease) in cash and cash equivalents                        (392)             788              (970)

    Cash and cash equivalents at beginning of year                               924              136             1,106
                                                                               -----            -----             -----

    Cash and cash equivalents at end of year                                  $  532           $  924            $  136
                                                                               =====            =====             =====
</TABLE>




                                       39
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE K - CONDENSED FINANCIAL STATEMENTS OF FFD FINANCIAL CORPORATION (continued)

    Regulations of the OTS impose limitations on the payment of dividends and
    other capital distributions by savings associations. Generally, the Bank's
    payment of dividends is limited, without prior OTS approval, to net earnings
    for the current calendar year plus the two preceding calendar years, less
    capital distributions paid over the comparable time period. The Bank is
    required to submit a notice of dividends payable with the OTS prior to
    payment. Insured institutions are required to file an application with the
    OTS for capital distributions in excess of this limitation.


NOTE L - STOCK OPTION PLAN

    The FFD Financial Corporation 1996 Stock Option and Incentive Plan (the
    "Plan") provides for the issuance of 145,475 shares of authorized but
    unissued shares of common stock.

    The Corporation accounts for the Plan in accordance with SFAS No. 123,
    "Accounting for Stock-Based Compensation," which 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 entities to
    continue to account for stock options and similar equity instruments under
    Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock
    Issued to Employees." Entities that continue to account for stock options
    using APB Opinion No. 25 are required to make pro forma disclosures of net
    earnings and earnings per share, as if the fair value-based method of
    accounting defined in SFAS No. 123 had been applied.

    The Corporation applies APB Opinion No. 25 and related Interpretations in
    accounting for its Plan. Accordingly, no compensation cost has been
    recognized with respect to the Plan. Had compensation cost for the Plan been
    determined based on the fair value at the grant date in a manner consistent
    with the accounting method utilized in SFAS No. 123, then the Corporation's
    consolidated net earnings and earnings per share for the fiscal years ended
    June 30, 2002, 2001 and 2000, would have been reduced to the pro forma
    amounts indicated below:

<TABLE>
<CAPTION>
                                                                                  2002         2001         2000
<S>                                                <C>                             <C>          <C>          <C>
    Net earnings (In thousands)                  As reported                    $1,113       $1,101         $922
                                                                                 =====        =====          ===

                                                   Pro-forma                    $1,095       $1,045         $865
                                                                                 =====        =====          ===

    Earnings per share
      Basic                                      As reported                      $.94         $.86         $.69
                                                                                   ===          ===          ===

                                                   Pro-forma                      $.92         $.82         $.65
                                                                                   ===          ===          ===

      Diluted                                    As reported                      $.92         $.86         $.68
                                                                                   ===          ===          ===

                                                   Pro-forma                      $.90         $.81         $.63
                                                                                   ===          ===          ===
</TABLE>


                                       40
<PAGE>


                            FFD FINANCIAL CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2002, 2001 and 2000


NOTE L - STOCK OPTION PLAN (continued)

    The fair value of each option grant is estimated on the date of grant using
    the modified Black-Scholes options-pricing model with the following
    weighted-average assumptions used for grants in fiscal 2002, 2001 and 2000:
    dividend yield of 3.5%, 4.0% and 3.0%; expected volatility of 36.7%, 23.5%
    and 27.3%; a risk-free interest rate of 3.0%, 5.0% and 6.0%, respectively,
    and an expected life of ten years for all grants.

    A summary of the status of the Corporation's stock option plan as of June
    30, 2002, 2001 and 2000, and changes during the years then ended are
    presented below:

<TABLE>
<CAPTION>
                                               2002                      2001                        2000
                                                   Weighted-                 Weighted-                 Weighted-
                                                     average                   average                   average
                                                    exercise                  exercise                  exercise
                                         Shares        price       Shares        price       Shares        price
<S>                                       <C>           <C>         <C>            <C>        <C>           <C>
    Outstanding at beginning of year    108,563       $ 9.22      109,538        $ 9.36     117,883        $10.26
    Granted                               2,000        12.00        3,000          8.38      18,635         10.11
    Exercised                            (5,578)        9.14          -              -       (2,967)         9.14
    Forfeited                              (600)       14.59       (3,975)        12.43     (24,013)        14.38
                                        -------        -----      -------         -----     -------         -----

    Outstanding at end of year          104,385       $ 9.25      108,563        $ 9.22     109,538        $ 9.36
                                        =======        =====      =======         =====     =======         =====

    Options exercisable at year-end      90,604       $ 9.21       73,612        $ 9.14      52,017        $ 9.20
                                        =======        =====      =======         =====     =======         =====
    Weighted-average fair value of
      options granted during the year                 $ 3.59                     $ 1.82                    $ 3.21
                                                       =====                      =====                     =====
</TABLE>


    The following information applies to options outstanding at June 30, 2002:

    Number outstanding                                                  104,385
    Range of exercise prices                                     $9.14 - $12.00
    Weighted-average exercise price                                       $9.25
    Weighted-average remaining contractual life in years                    5.2




















                                       41

<PAGE>


                            FFD FINANCIAL CORPORATION
                                       AND
                          FIRST FEDERAL COMMUNITY BANK
<TABLE>
<CAPTION>
                        DIRECTORS AND EXECUTIVE OFFICERS

===============================================================================
<S>                                                                                   <C>
               Board of Directors of                                          Executive Officers of
           FFD Financial Corporation and                                    FFD Financial Corporation
           First Federal Community Bank
                                                                                 Trent B. Troyer
                Stephen G. Clinton                                    President and Chief Executive Officer
                     President
             Capital Market Securities                                          Scott C. Finnell
                        and                                                 Executive Vice President
                  Vice-President
               Young and Associates                                             Robert R. Gerber
                                                                  Vice President, Treasurer and Chief Financial
                  J. Richard Gray                                                    Officer
                     Chairman
               Hanhart Agency, Inc.                                            Shirley A. Wallick
                                                                               Corporate Secretary
                 Richard J. Herzig
                Chairman - Retired                                            Executive Officers of
         Toland-Herzig Funeral Homes, Inc.                                First Federal Community Bank

                  Enos L. Loader                                                 Trent B. Troyer
             Chairman of the Board and                                President and Chief Executive Officer
            Retired Senior Bank Officer
                                                                                Scott C. Finnell
                Roy O. Mitchell, Jr                                         Executive Vice President
            Managing Officer - Retired
           First Federal Community Bank                                         Robert R. Gerber
                                                                  Vice President, Treasurer and Chief Financial
                 Robert D. Sensel                                                    Officer
       President and Chief Executive Officer
              Dover Hydraulics, Inc.                                           Shirley A. Wallick
                                                                              Corporate Secretary

                                                                                Other Officers of
                                                                          First Federal Community Bank

                                                                                Michele L. Larkin
                                                                                 Vice President

                                                                                 Jody P. Stoldt
                                                                                 Vice President

                                                                                Mary M. Mitchell
                                                                                 Banking Officer

                                                                             Kimberly Law-Montgomery
                                                                               Assistant Secretary
</TABLE>

                                      42
<PAGE>

                              SHAREHOLDER SERVICES

==============================================================================

Registrar and Transfer Company serves as transfer agent and dividend
distributing agent for FFD's shares. Communications regarding change of address,
transfer of shares, lost certificates and dividends should be sent to:

                         Registrar and Transfer Company
                                10 Commerce Drive
                         Cranford, New Jersey 07016-3572
                                 (800) 368-5948


                                 ANNUAL MEETING

==============================================================================

The Annual Meeting of Shareholders of FFD Financial Corporation will be held on
October 15, 2002, at 1:00 p.m., Eastern Time, at the Monarch Center, 831
Boulevard, Dover, Ohio 44622. Shareholders are cordially invited to attend.


                          ANNUAL REPORT ON FORM 10-KSB

==============================================================================

A copy of FFD's Annual Report on Form 10-KSB, as filed with the Securities and
Exchange Commission, will be available at no charge to shareholders upon request
to:

                            FFD Financial Corporation
                            321 North Wooster Avenue
                                Dover, Ohio 44622
                              Attention: Secretary























                                       43