FFD FINANCIAL CORPORATION
             321 North Wooster Avenue P.O. BOX 38 DOVER, OHIO 44622



Dear Shareholders:

It is with a great  deal  of  pleasure  that  we  present  to you FFD  Financial
Corporation's  Annual Report to Shareholders  for the fiscal year ended June 30,
2000.

FFD Financial  Corporation  reported  consolidated net earnings of $922,000,  or
$.69 per  share,  for the  fiscal  year  ended June 30,  2000,  an  increase  of
$205,000,  or 28.6%,  over reported net earnings of $717,000 for the fiscal year
ended June 30, 1999. The increase in net earnings is primarily attributable to a
$595,000,  or 20.0%,  increase in net interest income and a $55,000  decrease in
general, administrative and other expense.

We believe  asset growth is a strategic  imperative  for our  Corporation.  This
strategic  objective  was attained in fiscal year 2000 by  increasing  net loans
receivable by $15.6 million,  or 17.8%.  Growth in commercial loans was a key to
increasing net loans receivable,  as commercial loans increased by $11.7 million
from $19.0  million at June 30, 1999, to $30.7 million at June 30, 2000, a 61.8%
increase.  Our  multi-faceted  strategic  plan also included  offering  business
banking and consumer deposit products to provide funds for loan growth. Deposits
increased by $6.0  million  from June 30, 1999 to June 30, 2000,  an increase of
8.3%. Our New Philadelphia  office provided $3.7 million of the deposit increase
and ended its second  fiscal year of  operations on June 30, 2000 with a deposit
base of over $14.3 million.

We continue to take steps to position FFD Financial  and First  Federal  Savings
Bank of Dover for  continued  growth and  profitability  through  our  financial
products and customer services,  which include electronic  delivery channels for
our customers with our ATMs and telephone  banking.  Our next step in electronic
delivery is the  addition of  Internet  banking and bill paying to simplify  the
lives of our customers by providing financial services in a convenient manner.

Your  directors,  managers,  and staff are confident that our current  strategic
direction has positioned FFD and First Federal Savings Bank of Dover to meet the
challenges  confronting  us as we enter our 103rd year.  We remain  committed to
maintaining  friendly,  personalized  financial  services in our markets,  while
continuing  the local  decision-making  and focus our  customers  have  grown to
expect.

As  always,  we wish to take this  opportunity  to thank all our  customers  and
shareholders for your past and continuing  support that has made it possible for
us to prosper.


Sincerely,

/s/Robert R. Gerber


Robert R. Gerber
President


<PAGE>
                      BUSINESS OF FFD FINANCIAL CORPORATION

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

FFD Financial  Corporation ("FFD" or the  "Corporation"),  a unitary savings and
loan holding  company  incorporated in the State of Ohio, owns all of the issued
and  outstanding  common stock of First  Federal  Savings Bank of Dover  ("First
Federal" or the "Savings  Bank"),  a federal  savings bank.  In April 1996,  FFD
acquired  all of the common stock  issued by First  Federal upon its  conversion
from  a  mutual  savings   association  to  a  stock  savings  association  (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 First  Federal's  primary  lending  area,  to be held in
portfolio  or  sold  in  the  secondary  mortgage  market.  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 and mortgage-backed
securities repayments.  First Federal conducts business from two locations,  one
in Dover,  Ohio, and one in New Philadelphia,  Ohio. The primary market area for
First Federal is Tuscarawas County.

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.


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

There were 1,412,383  common shares of FFD  outstanding on August 31, 2000, held
of record by approximately 660 shareholders.  Price information for FFD's common
shares is quoted on the  Nasdaq  SmallCap  Market  ("Nasdaq")  under the  symbol
"FFDF."




                                       1
<PAGE>


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 2000 and 1999.
<TABLE>
<CAPTION>

                                  High Trade        Low Trade     Cash Dividends Declared
Fiscal 1999
<S>                                  <C>              <C>                   <C>
   Quarter Ended:
     September 30, 1998             $19.625          $15.500               $.075
     December 31, 1998               16.000           13.500                .075
     March 31, 1999                  14.750           13.000                .075
     June 30, 1999                   18.000           13.375                .075

Fiscal 2000
   Quarter Ended:
     September 30, 1999             $15.750          $11.875               $.085
     December 31, 1999               12.563           10.500                .085
     March 31, 2000                  11.500            9.125                .085
     June 30, 2000                    9.875            8.625                .085
</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,
                                                  ----------------------------------------------------------------
                                                     2000          1999         1998         1997           1996
                                                  -------        -------      -------       -------        -------
                                                                        (In thousands)
  Total amount of:
<S>                                                 <C>           <C>           <C>            <C>           <C>
    Assets                                       $125,147       $112,293      $90,966       $88,000       $79,458
    Interest-bearing deposits                       1,485          2,167          607         3,547         1,793
    Investment securities available for
       sale - at market                             2,875          2,924        2,655         9,924         9,256
    Investment securities held to maturity
       - at cost                                        -              -          977         1,469         2,460
    Mortgage-backed securities available
       for sale - at market                         9,135         10,978        5,935         7,944         9,007
    Mortgage-backed securities held to
       maturity - at cost                           4,189          4,779        5,960         7,165         5,932
    Loans receivable - net (1)                    102,939         87,382       70,990        55,504        48,539
    Deposits                                       77,987         72,025       61,956        57,090        52,208
    Advances from the FHLB and other
       borrowings                                  30,412         23,616       12,519         8,382         5,184

    Shareholders' equity, restricted (2)           16,265         16,204       15,825        21,480        21,411

</TABLE>

<TABLE>
<CAPTION>
                                                                      For the year ended June 30,
                                                ----------------------------------------------------------------
                                                  2000          1999           1998          1997           1996
Summary of earnings:                            -------        -------       -------        -------        ------
                                                             (In thousands, except per share data)
<S>                                               <C>            <C>            <C>            <C>          <C>
  Interest income                               $8,323         $6,915          $6,460        $5,880        $4,555
  Interest expense                               4,754          3,941           3,454         3,101         2,471
                                                 -----          -----           -----         -----         -----
  Net interest income                            3,569          2,974           3,006         2,779         2,084
  Provision for losses on loans                    106              -               -           125            50
                                                 -----          -----           -----         -----         -----
  Net interest income after provision
     for losses on loans                         3,463          2,974           3,006         2,654         2,034
  Other income                                     179            428             525         1,337            88
  General, administrative and other
     expense                                     2,262          2,317           2,044         1,859         1,163
                                                 -----          -----           -----         -----         -----
  Earnings before income taxes                   1,380          1,085           1,487         2,132           959
  Federal income taxes                             458            368             505           705           327
                                                 -----          -----           -----         -----         -----
  Net earnings                                  $  922         $  717          $  982        $1,427        $  632
                                                 =====          =====           =====         =====         =====
  Earnings per share
    Basic                                         $.69           $.53            $.73         $1.07           N/A
                                                   ===            ===             ===          ====           ===
    Diluted                                       $.68           $.51            $.71         $1.06           N/A
                                                   ===            ===             ===          ====           ===
</TABLE>

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

(1)  Includes loans held for sale.

(2)  At June 30, 2000 and 1999, includes $335,000 and $216,000 of net unrealized
     losses,  respectively,  and at June  30,  1998,  1997  and  1996,  includes
     $140,000,  $20,000 and $586,000,  respectively,  of net unrealized gains on
     investment and mortgage-backed securities designated as available for sale,
     net of related tax effects,  pursuant to Statement of Financial  Accounting
     Standards ("SFAS") No. 115.


                                       3
<PAGE>


<TABLE>
<CAPTION>

Selected financial ratios                                    At or for the year ended June 30,
  and other data:                              ----------------------------------------------------------------
                                                2000          1999           1998           1997           1996
                                               ------        ------         ------         ------         ------
<S>                                             <C>           <C>             <C>           <C>             <C>
Return on average assets                        0.77%         0.69%          1.06%         1.65%           0.99%
Return on average equity                        6.07          5.11           4.65          6.65            5.72
Interest rate spread                            2.51          2.37           2.22          2.15            2.41
Net interest margin                             3.06          2.92           3.29          3.30            3.28
General, administrative and other expense
   to average assets                            1.90          2.25           2.20          2.15            1.82
Average equity to average
   assets                                      12.75         13.59          22.75         24.83           17.29
Nonperforming assets to
   total assets                                 0.18          0.01           0.09          0.07            0.15
Nonperforming loans to total loans              0.22          0.02           0.11          0.11            0.24
Delinquent loans to total loans (1)             0.61          0.39           0.51          0.69            0.51
Allowance for loan losses to
   total loans                                  0.36          0.30           0.37          0.47            0.29
Allowance for loan losses to
   nonperforming loans                        166.67      1,793.33         329.27        421.88          124.79
Average interest-earning
   assets to average interest-bearing
   liabilities                                113.53        114.24         128.34        131.46          122.47
Number of full service offices                  2             2              2             1               1
Dividend payout ratio (2)                      49.28         56.60          41.10         21.03             N/A
</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.







                                       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, 1999 TO JUNE 30, 2000

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

The  Corporation's  assets at June 30, 2000,  totaled  $125.1  million,  a $12.9
million,  or 11.4%,  increase over the total at June 30, 1999. This increase was
funded  primarily  through an increase in advances from the FHLB of $6.8 million
and growth in deposits of $6.0 million.

Investment  securities  totaled  $2.9  million at June 30,  2000,  a decrease of
$49,000  from June 30, 1999.  The  decrease was due  primarily to the decline in
market value on available for sale securities, which are carried at fair value.

Mortgage-backed  securities  totaled  $13.3  million  at June 30,  2000,  a $2.4
million,  or 15.4%,  decrease  from the total at June 30,  1999.  This  decrease
resulted  from  principal  repayments  totaling  $2.3  million and a decrease in
market value on available for sale securities of approximately $131,000.

Loans receivable,  including loans held for sale, totaled $102.9 million at June
30, 2000, an increase of $15.6 million,  or 17.8%, over the June 30, 1999 total.
Loan  disbursements  during  fiscal  2000  totaled  $35.3  million,  which  were
partially  offset by principal  repayments  of $17.3  million and proceeds  from
loans sold in the secondary  market  totaling $2.4 million.  Loan  disbursements
during the year ended  June 30,  2000,  decreased  by $13.8  million,  or 33.7%,
compared  to the  origination  volume  during the same period in fiscal 1999 due
primarily to a decrease in customer  demand  following  the increase in interest
rates year to year. The growth in loans consisted primarily of commercial loans,
which totaled $30.7 million at June 30, 2000,  compared to $19.0 million at June
30, 1999.

The allowance for loan losses totaled $375,000 and $269,000 at June 30, 2000 and
1999,  respectively,  which represented .36% and .30% of total loans and 166.67%
and 1,793.33% of nonperforming  loans at those respective  dates.  Nonperforming
loans amounted to $225,000 and $15,000 at June 30, 2000, and 1999, respectively.
Although  management  believes  that the  allowance  for loan losses at June 30,


                                       5
<PAGE>

2000, 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  $78.0  million at June 30,  2000,  a $6.0  million,  or 8.3%,
increase over total deposits at June 30, 1999. This increase resulted  primarily
from growth in deposits totaling approximately $3.7 million at the branch office
located in New Philadelphia, Ohio, coupled with management's efforts to generate
growth through advertising and pricing strategies.  Proceeds from deposit growth
were used primarily to fund new loan originations during the period.

FHLB advances totaled $30.4 million at June 30, 2000, a $6.8 million,  or 28.8%,
increase  over June 30,  1999.  Proceeds  from the increase in  borrowings  were
primarily used to fund new loan originations.

Shareholders'  equity  totaled  $16.3  million at June 30, 2000,  an increase of
$61,000,  or .4%,  over June 30,  1999 levels as net  earnings of $922,000  were
partially  offset by dividends  paid  totaling  $484,000,  purchases of treasury
shares  totaling  $529,000,  and a $119,000  increase in the unrealized  loss on
securities designated as available for sale.


                         COMPARISON OF OPERATING RESULTS
                   FOR THE YEARS ENDED JUNE 30, 2000 AND 1999

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

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 $922,000 for the fiscal year ended June 30,
2000,  an  increase of  $205,000,  or 28.6%,  over the net  earnings of $717,000
recorded in fiscal 1999. The increase in net earnings resulted  primarily from a
$595,000  increase  in net  interest  income and a $55,000  decrease in general,
administrative  and other  expense,  which were  partially  offset by a $249,000
decrease in other  operating  income,  a $106,000  increase in the provision for
losses on loans,  and a $90,000  increase in the  provision  for federal  income
taxes.

Net Interest Income.  Total interest income increased by $1.4 million, or 20.4%,
to a total of $8.3  million for the year ended June 30,  2000,  compared to $6.9
million for the year ended June 30, 1999.  Interest income on loans increased by
$1.5 million, or 26.8%, due primarily to a $16.6 million, or 20.9%,  increase in
the average loan portfolio  balance  outstanding,  coupled with a 34 basis point
increase in the  average  yield,  to 7.34% in fiscal  2000.  Interest  income on
mortgage-backed  securities  decreased by $32,000,  or 3.3%,  due primarily to a
$706,000, or 4.6%, decrease in the average balance outstanding,  offset somewhat
by a 9 basis point increase in the yield earned on such securities,  to 6.41% in
fiscal 2000.  Interest  income on  investment  securities  and  interest-bearing
deposits  decreased by $51,000,  or 13.4%,  due primarily to an approximate $1.0
million, or 14.9%, decrease in the related average investment balance.



                                       6
<PAGE>


Interest expense on deposits increased by $188,000,  or 6.3%, for the year ended
June 30, 2000,  compared to fiscal 1999,  due  primarily to a $4.9  million,  or
7.0%, increase in the average deposit portfolio balance outstanding.

Interest expense on borrowings increased by $625,000, or 65.3%, due primarily to
an  $8.8  million,  or  44.7%,  increase  in the  average  balance  of  advances
outstanding,  coupled with a 70 basis point increase in the average cost of such
borrowings, to 5.57% in fiscal 2000.

As a result of the foregoing  changes in interest  income and interest  expense,
net interest income  increased by $595,000,  or 20.0%, for the fiscal year ended
June  30,  2000,   compared  to  fiscal  1999.  The  interest  rate  spread  was
approximately  2.51% for the fiscal year ended June 30, 2000,  compared to 2.37%
for the 1999  fiscal  year,  while the net  interest  margin  was 3.06% in 2000,
compared to 2.92% in 1999.

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  $106,000 for the year ended June 30,  2000.  For the fiscal year
ended June 30, 1999, management concluded that the allowance for loan losses was
adequate  and did not  record a  provision  for losses on loans.  First  Federal
recorded the  provision  during  fiscal 2000  primarily due to the growth in the
commercial and  nonresidential  loan portfolios.  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 $179,000 for the year ended June 30, 2000, a
decrease of  $249,000,  or 58.2%,  from the 1999 total.  The  decrease  resulted
primarily  from the absence of a $210,000 gain on sales of  securities  recorded
during fiscal 1999, and an $83,000, or 76.9%,  decrease in gain on sale of loans
in fiscal 2000, which were partially offset by a $44,000, or 40.0%,  increase in
other  operating  income.  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  $2.3  million for the year ended June 30,  2000, a decrease of
$55,000,  or 2.4%,  compared to the same period in 1999.  The decrease  resulted
primarily  from a  $41,000,  or 3.7%,  decrease  in  employee  compensation  and
benefits  and a $52,000,  or 19.5%,  decrease  in  franchise  taxes,  which were
partially offset by a $55,000, or 11.5%, increase in other operating expenses.

The decrease in employee  compensation  and  benefits  was due  primarily to the
decrease  in expense  associated  with stock  benefit  plans.  The  decrease  in
franchise taxes resulted from a reduction in the tax rate. The increase in other
operating expense consisted primarily of a $40,000 increase in ATM related costs
and pro-rata increases in other expenses due to the Corporation's overall growth
year to year.


                                       7
<PAGE>

Federal Income Taxes. FFD recorded a provision for federal income taxes totaling
$458,000  for the year ended June 30,  2000,  an increase of $90,000,  or 24.5%,
over fiscal 1999. The increase  resulted  primarily  from a $295,000,  or 27.2%,
increase in earnings before taxes.  The effective tax rates were 33.2% and 33.9%
for the years ended June 30, 2000 and 1999, respectively.


                         COMPARISON OF OPERATING RESULTS
                   FOR THE YEARS ENDED JUNE 30, 1999 AND 1998

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

General.  FFD's net earnings totaled $717,000 for the fiscal year ended June 30,
1999,  a decrease  of  $265,000,  or 27.0%,  from the net  earnings  of $982,000
recorded in fiscal 1998. The decrease in net earnings resulted  primarily from a
$32,000  decrease in net interest income, a $97,000 decrease in other income and
a $273,000  increase in general,  administrative  and other expense,  which were
partially  offset by a $137,000  decrease in the  provision  for federal  income
taxes.

Net Interest Income. Total interest income increased by $455,000,  or 7.0%, to a
total of $6.9 million for the year ended June 30, 1999, compared to $6.5 million
for the year  ended  June 30,  1998.  Interest  income  on  loans  increased  by
$801,000,  or 16.8%, due primarily to a $16.2 million, or 25.6%, increase in the
average loan portfolio balance  outstanding,  which was partially offset by a 53
basis point  decrease in the average  yield,  to 7.00% in fiscal 1999.  Interest
income  on  mortgage-backed  securities  increased  by  $41,000,  or  4.4%,  due
primarily  to  a  $1.1  million,  or  7.8%,  increase  in  the  average  balance
outstanding,  partially  offset by a 21 basis point decrease in the yield earned
on such  securities,  to 6.32% in fiscal  1999.  Interest  income on  investment
securities and  interest-bearing  deposits decreased by $387,000,  or 50.5%, due
primarily to an  approximate  $7.0  million,  or 50.5%,  decrease in the related
average investment balance.

Interest expense on deposits increased by $187,000,  or 6.7%, for the year ended
June 30, 1999,  compared to fiscal 1998,  due  primarily to a $9.8  million,  or
16.5%, increase in the average deposit portfolio balance outstanding,  which was
partially  offset by a 40 basis point  decrease  in the cost of such  funds,  to
4.30% in fiscal 1999.

Interest expense on borrowings increased by $300,000, or 45.7%, due primarily to
an  $8.0  million,  or  68.1%,  increase  in the  average  balance  of  advances
outstanding,  which was  partially  offset by a 75 basis  point  decline  in the
average cost of such borrowings, to 4.87% in fiscal 1999.

As a result of the foregoing  changes in interest  income and interest  expense,
net interest  income  decreased by $32,000,  or 1.1%,  for the fiscal year ended
June  30,  1999,   compared  to  fiscal  1998.  The  interest  rate  spread  was
approximately  2.37% for the fiscal year ended June 30, 1999,  compared to 2.22%
for the 1998  fiscal  year,  while the net  interest  margin  was 2.92% in 1999,
compared to 3.29% in 1998.

Provision  for Losses on Loans.  As a result of an analysis of  historical  loss
experience,  the volume  and type of lending  conducted  by First  Federal,  the

                                       8
<PAGE>

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,
management  concluded  that the  allowance  for loan  losses was  adequate  and,
therefore,  did not record a  provision  for  losses on loans  during the fiscal
years ended June 30, 1999 and 1998.

Other Income.  Other income totaled $428,000 for the year ended June 30, 1999, a
decrease  of  $97,000,  or 18.5%,  from the 1998 total.  The  decrease  resulted
primarily  from a $231,000,  or 52.4%,  decrease in gain on sales of securities,
which was  partially  offset by a $108,000  gain on sale of loans in fiscal 1999
and a $26,000, or 31.0%, increase in other operating income.

General,  Administrative  and Other Expense.  General,  administrative and other
expense  totaled $2.3  million for the year ended June 30, 1999,  an increase of
$273,000,  or 13.4%,  compared to the same period in 1998. The increase resulted
primarily  from an  $83,000,  or 8.0%,  increase in  employee  compensation  and
benefits,  a $44,000,  or 22.8%,  increase in occupancy and equipment expense, a
$53,000, or 24.9%, increase in franchise taxes, a $73,000, or 70.0%, increase in
data processing and a $16,000, or 3.5%, increase in other operating expenses.

The increase in employee  compensation  and  benefits  was due  primarily to the
addition of a secondary  marketing officer and support staff during fiscal 1999,
and an increase in expense  associated  with stock benefit  plans,  normal merit
increases  and  increased  staffing  levels  related  to the  opening of the New
Philadelphia  office  location in November  1997.  The increase in occupancy and
equipment and other operating  expense resulted  primarily from costs associated
with  office  remodeling,  the  implementation  of  new  business  products  and
services,  and the  opening of the New  Philadelphia  office.  The  increase  in
franchise taxes was due to the increase in First Federal's capital year to year.
The increase in data processing  costs was due primarily to the increased number
of deposit and loan accounts associated with the First Federal's growth.

Federal Income Taxes. FFD recorded a provision for federal income taxes totaling
$368,000 for the year ended June 30,  1999,  a decrease of  $137,000,  or 27.1%,
from fiscal 1998. The decrease  resulted  primarily  from a $402,000,  or 27.0%,
decrease in earnings before taxes.  The effective tax rate was 33.9% for each of
the years ended June 30, 1999 and 1998.













                                       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,
                                 -------------------------------------------------------------------------------------
                                               2000                          1999                                 1998
                                   --------------------------    ---------------------------         --------------------------
                                    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                $ 96,101     $7,058     7.34%  $ 79,497   $5,567      7.00%      $63,315      $4,766      7.53%
  Mortgage-backed securities        14,599        936     6.41     15,305      968      6.32        14,202         927      6.53
  Investment securities              3,000        191     6.37      2,902      177      6.10         5,097         319      6.26
  Interest-bearing deposits
    and other                        2,858        138     4.82      3,978      203      5.10         8,816         448      5.08
                                   -------     ------     ----    -------    -----      ----        ------       -----      ----
  Total interest-earning assets    116,558      8,323     7.14    101,682    6,915      6.80        91,430       6,460      7.07

  Non-interest-earning assets        2,516                          1,517                            1,417
                                   -------                        -------                           ------

    Total assets                  $119,074                       $103,199                          $92,847
                                   =======                        =======                           ======

Interest-bearing liabilities:
  Deposits                        $ 74,254      3,172     4.27   $ 69,374    2,984      4.30       $59,554       2,797      4.70
  Borrowings                        28,413      1,582     5.57     19,637      957      4.87        11,685         657      5.62
                                   -------      -----     ----    -------    -----      ----        ------       -----      ----
    Total interest-bearing
      liabilities                  102,667      4,754     4.63     89,011    3,941      4.43        71,239       3,454      4.85
                                   -------      -----             -------    -----                  ------       -----

Non-interest-bearing liabilities     1,222                            166                              487
                                   -------                        -------                           ------

  Total liabilities                103,889                         89,177                           71,726

Shareholders' equity                15,185                         14,022                           21,121
                                   -------                        -------                           ------

    Total liabilities and
      shareholders' equity        $119,074                       $103,199                          $92,847
                                   =======                        =======                           ======

Net interest income                            $3,569                       $2,974                             $3,006
                                                =====                        =====                              =====

Interest rate spread                                      2.51%                         2.37%                               2.22%
                                                          ====                          ====                                ====

Net interest margin (net interest
  income as a percent of average
  interest-earning assets)                                3.06%                         2.92%                               3.29%
                                                          ====                          ====                                ====

Average interest-earning assets to
  average interest-bearing liabilities                  113.53%                       114.24%                             128.34%
                                                        ======                        ======                              ======

</TABLE>

The  table on the  following  page  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.



                                       10
<PAGE>


<TABLE>
<CAPTION>
                                                                     Year ended June 30,
                                                     2000 vs. 1999                        1999 vs. 1998
                                             -------------------------              -----------------------
                                                  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                          $1,210         $281     $1,491      $1,133      $(332)      $801
   Mortgage-backed securities                   (45)          13        (32)         70        (29)        41
   Investment securities                          6            8         14        (134)        (8)      (142)
   Interest-bearing deposits and other
                                                (54)         (11)       (65)       (247)         2       (245)
                                              -----          ---      -----       -----       ----        ---
Total interest income                         1,117          291      1,408         822       (367)       455
                                              -----          ---      -----       -----       ----        ---

Interest expense attributable to:
   Deposits                                     208          (20)       188         422       (235)       187
   Borrowings                                   473          152        625         388        (88)       300
                                              -----          ---      -----       -----       ----        ---

Total interest expense                          681          132        813         810       (323)       487
                                              -----          ---      -----       -----       ----        ---

Increase (decrease) in net interest income
                                             $  436         $159     $  595      $   12      $ (44)       $(32)
                                              =====          ===      =====       =====       ====         ===
</TABLE>


                         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 as part of its  capital  regulations.  Although
First  Federal is not  currently  subject  to the NPV  regulation  because  such
regulation does not apply to institutions  with less than $300 million in assets
and risk-based  capital in excess of 12%, the application of the NPV methodology
illustrates certain aspects of First Federal's interest rate risk.

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.







                                       11
<PAGE>


Presented below, as of June 30, 2000 and 1999, 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, 2000
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%                    $(472)                    (3.14)%
         +200                             +20.0                      (137)                    (0.91)
           -                                -                           -                       -
         -200                             -20.0                      (495)                    (3.30)
         -300                             -30.0                      (964)                    (6.42)
</TABLE>



<TABLE>
<CAPTION>

                                                                              June 30, 1999
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%                  $   566                      4.38%
         +200                             +20.0                       602                      4.63
           -                                -                           -                       -
         -200                             -20.0                    (1,721)                   (13.22)
         -300                             -30.0                    (2,648)                   (20.47)
</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,   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 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.

OTS  regulations  presently  require  First Federal to maintain an average daily
balance of  investments  in United States  Treasury  securities,  federal agency
obligations  and certain other  investments  having  maturities of five years or
less in an  amount  equal  to 4% of the sum of  First  Federal's  average  daily
balance of net withdrawable  deposit accounts and borrowings payable in one year
or less.  The liquidity  requirement,  which may be changed from time to time by
the OTS to reflect changing economic conditions, is intended to provide a source
of relatively  liquid funds upon which First Federal may rely, if necessary,  to
fund deposit  withdrawals or other  short-term  funding needs. At June 30, 2000,
First  Federal's  regulatory  liquidity  ratio was 28.9%.  At such  date,  First
Federal had commitments to originate  loans,  including  unused lines of credit,
totaling $8.7 million and no commitments to purchase or sell loans.

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,
2000, 1999 and 1998:
<TABLE>
<CAPTION>

                                                                            Year ended June 30,
                                                           -------------------------------------------------
                                                              2000                 1999                 1998
                                                           --------              --------            --------
                                                                              (In thousands)
<S>                                                          <C>                  <C>                    <C>
Net earnings                                               $   922               $   717               $  982
Adjustments to reconcile net earnings to
   net cash from operating activities                          608                  (965)                (675)
                                                            ------                ------                -----
Net cash from (used in) operating activities                 1,530                  (248)                 307
Net cash used in investing activities                      (13,894)              (19,213)              (4,706)
Net cash from financing activities                          11,772                20,839                1,952
                                                            ------                ------                -----
Net change in cash and cash equivalents                       (592)                1,378               (2,447)
Cash and cash equivalents at
   beginning of year                                         3,011                 1,633                4,080
                                                            ------                ------                -----
Cash and cash equivalents at
   end of year                                             $ 2,419               $ 3,011               $1,633
                                                            ======                ======                =====

</TABLE>





                                       13
<PAGE>

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  association  to maintain
"tangible  capital" of not less than 1.5% of the  association'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
associations to maintain core capital of at least 4% of the association's  total
assets,  except for those  associations with the highest  examination rating and
acceptable levels of risk.

OTS regulations require that savings associations  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 in the
case of First Federal includes a general loan loss allowance of $366,000 at June
30, 2000.

First Federal  exceeded all of its capital  requirements  at June 30, 2000.  The
following table summarizes First Federal's  regulatory capital  requirements and
regulatory capital at June 30, 2000:
<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          $15,519       12.3%        $1,897        1.5%       $13,622         10.8%
Core capital               15,519       12.3          5,058        4.0         10,461          8.3
Risk-based capital         15,885       19.4          6,550        8.0          9,335         11.4
</TABLE>


                   EFFECT OF Recent ACCOUNTING PRONOUNCEMENTS

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

In June 1998, the Financial  Accounting Standards Board (the "FASB") issued SFAS
No. 133,  "Accounting for Derivative  Instruments and Hedging Activities," which
requires entities to recognize all derivatives in their financial  statements as
either assets or liabilities measured at fair value. SFAS No. 133 also specifies
new methods of accounting  for hedging  transactions,  prescribes  the items and
transactions  that may be hedged,  and specifies  detailed criteria to be met to
qualify for hedge accounting.




                                       14
<PAGE>


The definition of a derivative  financial instrument is complex, but in general,
it is an instrument  with one or more  underlyings,  such as an interest rate or
foreign exchange rate, that is applied to a notional  amount,  such as an amount
of currency,  to determine the settlement  amount(s).  It generally  requires no
significant initial investment and can be settled net or by delivery of an asset
that is  readily  convertible  to cash.  SFAS No.  133  applies  to  derivatives
embedded in other contracts, unless the underlying of the embedded derivative is
clearly and closely related to the host contract.

SFAS No.  133,  as amended  by SFAS No.  137,  is  effective  for  fiscal  years
beginning  after June 15, 2000. On adoption,  entities are permitted to transfer
held-to-maturity  debt securities to the  available-for-sale or trading category
without  calling into  question  their intent to hold other debt  securities  to
maturity in the future.  FFD adopted  SFAS No. 133  effective  July 1, 2000,  as
required,  without  material effect on FFD's financial  condition and results of
operations.




























                                       15
<PAGE>


                         REPORT OF INDEPENDENT CERTIFIED
                             PUBLIC ACCOUNTANTS AND
                        CONSOLIDATED FINANCIAL STATEMENTS

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

                                    CONTENTS

                                                                      Page

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS                     17


FINANCIAL STATEMENTS

         CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION                18

         CONSOLIDATED STATEMENTS OF EARNINGS                           19

         CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME               20

         CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY               21

         CONSOLIDATED STATEMENTS OF CASH FLOWS                         22

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                    24



















                                       16
<PAGE>


               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

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

Board of Directors
FFD Financial Corporation

We have audited the accompanying  consolidated statements of financial condition
of FFD  Financial  Corporation  as of June 30,  2000 and 1999,  and the  related
consolidated statements of earnings,  comprehensive income, shareholders' equity
and cash flows for each of the years ended June 30, 2000,  1999 and 1998.  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  generally   accepted  auditing
standards.  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 financial  statements  referred to above present fairly, in
all material  respects,  the  consolidated  financial  position of FFD Financial
Corporation  as of June 30, 2000 and 1999, and the  consolidated  results of its
operations  and its cash flows for each of the years ended June 30,  2000,  1999
and 1998, in conformity with generally accepted accounting principles.



/s/GRANT THORNTON LLP


Cincinnati, Ohio
August 18, 2000










                                       17
<PAGE>


                            FFD Financial Corporation

<TABLE>
<CAPTION>
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

                                    June 30,
                        (In thousands, except share data)


         ASSETS                                                                                2000                1999
<S>                                                                                          <C>                   <C>
Cash and due from banks                                                                    $    934            $    844
Interest-bearing deposits in other financial institutions                                     1,485               2,167
                                                                                            -------             -------
         Cash and cash equivalents                                                            2,419               3,011

Investment securities designated as available
  for sale - at market                                                                        2,875               2,924
Mortgage-backed securities designated as available for
  sale - at market                                                                            9,135              10,978
Mortgage-backed securities held to maturity - at amortized cost,
  approximate market value of $4,188 and $4,907 as of June 30,
  2000 and 1999                                                                               4,189               4,779
Loans receivable - net                                                                      102,118              86,417
Loans held for sale - at lower of cost or market                                                821                 965
Office premises and equipment - at depreciated cost                                           1,253               1,364
Stock in Federal Home Loan Bank - at cost                                                     1,652               1,201
Accrued interest receivable                                                                     429                 329
Prepaid expenses and other assets                                                               181                 209
Prepaid federal income taxes                                                                     61                 116
Deferred federal income taxes                                                                    14                  -
                                                                                            -------             -------

         Total assets                                                                      $125,147            $112,293
                                                                                            =======             =======

         LIABILITIES AND SHAREHOLDERS' EQUITY

Deposits                                                                                   $ 77,987            $ 72,025
Advances from the Federal Home Loan Bank                                                     30,412              23,616
Accrued interest payable                                                                        202                 146
Other liabilities                                                                               281                 250
Deferred federal income taxes                                                                    -                   52
                                                                                            -------             -------
         Total liabilities                                                                  108,882              96,089

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                                                                  7,850               7,798
  Retained earnings - substantially restricted                                               10,288               9,850
  Accumulated comprehensive loss; unrealized losses on securities designated
    as available for sale, net of related tax effects                                          (335)               (216)
  Shares acquired by stock benefit plans                                                     (1,028)             (1,207)
  Less 42,367 and 1,334 treasury shares at June 30, 2000 and 1999 - at cost                    (510)                (21)
                                                                                            -------             -------
         Total shareholders' equity                                                          16,265              16,204
                                                                                            -------             -------

         Total liabilities and shareholders' equity                                        $125,147            $112,293
                                                                                            =======             =======
</TABLE>


The accompanying notes are an integral part of these statements.



                                       18
<PAGE>


                            FFD Financial Corporation
<TABLE>
<CAPTION>

                       CONSOLIDATED STATEMENTS OF EARNINGS

                               Year ended June 30,
                      (In thousands, except per share data)

                                                                                      2000            1999         1998
<S>                                                                                  <C>             <C>           <C>
Interest income
  Loans                                                                             $7,058          $5,567       $4,766
  Mortgage-backed securities                                                           936             968          927
  Investment securities                                                                191             177          319
  Interest-bearing deposits and other                                                  138             203          448
                                                                                     -----           -----        -----
         Total interest income                                                       8,323           6,915        6,460

Interest expense
  Deposits                                                                           3,172           2,984        2,797
  Borrowings                                                                         1,582             957          657
                                                                                     -----           -----        -----
         Total interest expense                                                      4,754           3,941        3,454
                                                                                     -----           -----        -----

         Net interest income                                                         3,569           2,974        3,006

Provision for losses on loans                                                          106              -            -
                                                                                     -----           -----        -----

         Net interest income after provision for losses on loans                     3,463           2,974        3,006

Other income
  Gain on sale of loans                                                                 25             108           -
  Gain on sale of investment securities designated
    as available for sale                                                               -              210          441
  Other operating                                                                      154             110           84
                                                                                     -----           -----        -----
         Total other income                                                            179             428          525

General, administrative and other expense
  Employee compensation and benefits                                                 1,076           1,117        1,034
  Occupancy and equipment                                                              229             237          193
  Franchise taxes                                                                      214             266          213
  Federal deposit insurance premiums                                                    26              38           34
  Data processing                                                                      185             182          109
  Other operating                                                                      532             477          461
                                                                                     -----           -----        -----
         Total general, administrative and other expense                             2,262           2,317        2,044
                                                                                     -----           -----        -----

         Earnings before income taxes                                                1,380           1,085        1,487

Federal income taxes
  Current                                                                              463             249          311
  Deferred                                                                              (5)            119          194
                                                                                     -----           -----        -----
         Total federal income taxes                                                    458             368          505
                                                                                     -----           -----        -----

         NET EARNINGS                                                               $  922          $  717       $  982
                                                                                     =====           =====        =====

         EARNINGS PER SHARE
           Basic                                                                      $.69            $.53         $.73
                                                                                       ===             ===          ===

           Diluted                                                                    $.68            $.51         $.71
                                                                                       ===             ===          ===

</TABLE>


The accompanying notes are an integral part of these statements.

                                       19

<PAGE>


                            FFD Financial Corporation
<TABLE>
<CAPTION>

                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

                               Year ended June 30,
                                 (In thousands)


                                                                                    2000            1999           1998
<S>                                                                                  <C>            <C>            <C>
Net earnings                                                                       $ 922           $ 717         $  982

Other comprehensive income, net of tax:
  Unrealized holding gains (losses) on securities
    during the period, net of tax of $(61), $(112)
    and $212 in 2000, 1999 and 1998, respectively                                   (119)           (217)           411

Reclassification adjustment for realized gains
  included in earnings, net of tax of $71 and
    $150 in 1999 and 1998, respectively                                               -             (139)          (291)
                                                                                    ----            ----          -----

Comprehensive income                                                               $ 803           $ 361         $1,102
                                                                                    ====            ====          =====

Accumulated comprehensive income (loss)                                            $(335)          $(216)        $  140
                                                                                    ====            ====          =====
</TABLE>



























The accompanying notes are an integral part of these statements.


                                       20

<PAGE>


                            FFD Financial Corporation
<TABLE>
<CAPTION>
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                For the years ended June 30, 2000, 1999 and 1998
                      (In thousands, except per share data)


                                                                                                  Unrealized
                                                                              Shares            gains (losses)
                                                                         acquired by             on securities
                                                             Additional        stock  Treasury    designated
                                                      Common    paid-in      benefit   shares-  as available  Retained
                                                       stock    capital        plans   at cost      for sale  earnings      Total
<S>                                                     <C>       <C>           <C>       <C>           <C>       <C>        <C>
Balance at July 1, 1997                                 $ -     $14,137      $(1,634)    $  -          $  20   $ 8,957    $21,480

Net earnings for the year ended June 30, 1998             -          -            -         -             -        982        982
Purchase of treasury shares                               -          -            -       (154)           -         -        (154)
Amortization of stock benefit plan expense                -          71          223        -             -         -         294
Unrealized gain on securities designated as available
  for sale, net of related tax effects                    -          -            -         -            120        -         120
Exercise of stock options                                 -           1           -          9            -         -          10
Capital distribution of $4.50 per share                   -      (6,504)          -         -             -         -      (6,504)
Dividends of $.30 per share                               -          -            -         -             -       (403)      (403)
                                                         ---     ------       ------      ----          ----    ------     ------

Balance at June 30, 1998                                  -       7,705       (1,411)     (145)          140     9,536     15,825

Net earnings for the year ended June 30, 1999             -          -            -         -             -        717        717
Amortization of stock benefit plan expense                -         141          204        -             -         -         345
Unrealized loss on securities designated as available
  for sale, net of related tax effects                    -          -            -         -           (356)       -        (356)
Exercise of stock options                                 -         (48)          -        124            -         -          76
Dividends of $.30 per share                               -          -            -         -             -       (403)      (403)
                                                         ---     ------       ------      ----          ----    ------     ------

Balance at June 30, 1999                                  -       7,798       (1,207)      (21)         (216)    9,850     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 loss 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      $(1,028)    $(510)        $(335)  $10,288    $16,265
                                                         ===     ======       ======      ====          ====    ======     ======
</TABLE>



The accompanying notes are an integral part of these statements.


                                       21

<PAGE>


                            FFD Financial Corporation
<TABLE>
<CAPTION>

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                               Year ended June 30,
                                 (In thousands)

                                                                                    2000            1999           1998
<S>                                                                                  <C>            <C>              <C>
Cash flows from operating activities:
  Net earnings for the year                                                      $   922         $   717        $   982
  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                             40              53             33
    Amortization of deferred loan origination fees                                   (25)            (57)           (73)
    Gain on sale of loans                                                             (8)            (46)            -
    Loans originated for sale in the secondary market                             (2,206)         (8,398)            -
    Proceeds from sale of mortgage loans in the secondary market                   2,358           7,479             -
    Depreciation and amortization                                                    138             131            109
    Gain on sale of investment and mortgage-backed
      securities designated as available for sale                                     -             (210)          (441)
    Provision for losses on loans                                                    106              -              -
    Amortization of stock benefit plan expense                                       244             345            294
    Federal Home Loan Bank stock dividends                                          (104)            (74)           (55)
    Increase (decrease) in cash due to changes in:
      Accrued interest receivable                                                   (100)            (50)           (12)
      Prepaid expenses and other assets                                               28              12            (81)
      Other liabilities                                                               31              (8)           (82)
      Accrued interest payable                                                        56              52             12
      Federal income taxes
        Current                                                                       55            (313)          (573)
        Deferred                                                                      (5)            119            194
                                                                                  ------          ------         ------
         Net cash provided by (used in) operating activities                       1,530            (248)           307

Cash flows provided by (used in) investing activities:
  Purchase of investment securities designated as available
    for sale                                                                          -           (3,000)        (6,947)
  Purchase of investment securities designated as
    held to maturity                                                                  -               -          (1,244)
  Proceeds from maturity of investment securities                                     -            3,477         10,157
  Proceeds from sale of investment securities designated
    as available for sale                                                             -              212          6,430
  Purchase of mortgage-backed securities designated
    as available for sale                                                             -           (9,633)            -
  Principal repayments on mortgage-backed securities                               2,262           5,407          3,174
  Purchase of Federal Home Loan Bank stock                                          (347)           (194)          (236)
  Loan principal repayments                                                       17,338          17,172         13,826
  Loan disbursements                                                             (33,120)        (32,542)       (29,239)
  Purchase of office premises and equipment                                          (27)           (115)          (627)
  Proceeds from sale of office premises and equipment                                 -                3             -
                                                                                  ------          ------         ------
         Net cash used in investing activities                                   (13,894)        (19,213)        (4,706)
                                                                                  ------          ------         ------

         Net cash used in operating and investing
           activities (subtotal carried forward)                                 (12,364)        (19,461)        (4,399)
                                                                                  ------          ------         ------
</TABLE>




                                       22
<PAGE>


                            FFD Financial Corporation
<TABLE>
<CAPTION>

                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

                               Year ended June 30,
                                 (In thousands)


                                                                                    2000            1999           1998
<S>                                                                                <C>              <C>            <C>
         Net cash used in operating and investing
           activities (subtotal brought forward)                                $(12,364)       $(19,461)       $(4,399)

Cash flows provided by (used in) financing activities:
  Net increase in deposit accounts                                                 5,962          10,069          4,866
  Proceeds from Federal Home Loan Bank advances                                   39,491          11,133         11,950
  Repayments of Federal Home Loan Bank advances                                  (32,695)            (36)        (7,813)
  Proceeds from exercise of stock options                                             27              76             10
  Purchase of treasury shares                                                       (529)             -            (154)
  Cash distributions paid on common stock                                           (484)           (403)        (6,907)
                                                                                 -------         -------         ------
         Net cash provided by financing activities                                11,772          20,839          1,952
                                                                                 -------         -------         ------

Net increase (decrease) in cash and cash equivalents                                (592)          1,378         (2,447)

Cash and cash equivalents at beginning of year                                     3,011           1,633          4,080
                                                                                 -------         -------         ------

Cash and cash equivalents at end of year                                        $  2,419        $  3,011        $ 1,633
                                                                                 =======         =======         ======


Supplemental disclosure of cash flow information:
  Cash paid during the year for:
    Federal income taxes                                                        $    442        $    182        $   819
                                                                                 =======         =======         ======

    Interest on deposits and borrowings                                         $  4,698        $  3,889        $ 3,442
                                                                                 =======         =======         ======


Supplemental disclosure of noncash investing activities:
  Unrealized gains (losses) on securities designated as
    available for sale, net of applicable tax effects                           $   (119)       $   (356)       $   120
                                                                                 =======         =======         ======

  Recognition of mortgage servicing rights in accordance
    with SFAS No. 125                                                           $     17        $     62        $    -
                                                                                 =======         =======         ======

</TABLE>










The accompanying notes are an integral part of these statements.


                                       23

<PAGE>


                            FFD Financial Corporation

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          June 30, 2000, 1999 and 1998


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 First
    Federal  Savings  Bank of Dover  (the  "Savings  Bank").  The  Savings  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 Savings 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 Savings 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  generally  accepted  accounting  principles  ("GAAP")  and
    general  accounting  practices within the financial  services  industry.  In
    preparing   consolidated  financial  statements  in  accordance  with  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 Savings Bank, and its wholly-owned  subsidiary,  Dover
    Service Corporation ("Dover").  At June 30, 2000 and 1999, Dover's principal
    assets  consisted of an investment  in the stock of the Savings  Bank's data
    processor  and a deposit  account  in the  Savings  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


                                       24
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    2.  Investment Securities and Mortgage-backed Securities (continued)

    are carried at fair value with resulting unrealized gains or losses recorded
    to operations or shareholders'  equity,  respectively.  At June 30, 2000 and
    1999, the Corporation's shareholders' equity reflected a net unrealized loss
    on  securities  designated  as  available  for sale  totaling  $335,000  and
    $216,000, respectively.

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

    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  balances of the related loan. At June 30, 2000,
    loans held for sale were carried at cost.

    The Savings Bank retains the  servicing on loans sold and agrees to remit to
    the investor loan principal and interest at agreed-upon  rates.  The Savings
    Bank recognizes rights to service mortgage loans for others pursuant to SFAS
    No. 125,  "Accounting  for Transfers  and Servicing of Financial  Assets and
    Extinguishments  of  Liabilities."  In  accordance  with  SFAS No.  125,  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.

    SFAS No.  125  requires  that  capitalized  mortgage  servicing  rights  and
    capitalized  excess  servicing   receivables  be  assessed  for  impairment.
    Impairment is measured based on fair value.  The mortgage  servicing  rights
    recorded by the Savings Bank,  calculated in accordance  with the provisions
    of SFAS No. 125, 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



                                       25
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    3.  Loans Receivable (continued)

    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 Savings Bank recorded  amortization related to mortgage servicing rights
    totaling  approximately $10,000 and $5,000 for the years ended June 30, 2000
    and 1999,  respectively.  At June 30,  2000 and 1999,  the fair value of the
    Corporation's  mortgage servicing rights  approximated the carrying value of
    $65,000 and $57,000, respectively.

    4.  Loan Origination Fees

    The Savings 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 Savings 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  Savings  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 Savings
    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).


                                       26
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    5.  Allowance for Loan Losses (continued)

    The Savings 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 Savings 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
    Savings 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,  2000 and 1999,  the  Savings  Bank had no loans  that  would be
    defined as impaired under SFAS No. 114.

    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.


                                       27
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    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.

    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
    $145,000,  $261,000  and  $228,000 for the fiscal years ended June 30, 2000,
    1999 and 1998, respectively.

    Additionally, during fiscal 1997, the Savings Bank adopted the First Federal
    Savings Bank of Dover  Recognition  and Retention Plan ("RRP").  The Savings
    Bank  funded  the  RRP  through  the  purchase  of  40,600   shares  of  the
    Corporation's  common stock in the open market. The Savings Bank has awarded
    29,300 shares under the RRP which vest over a five year period.  A provision
    of $62,000,  $110,000 and $109,000 related to the RRP was charged to expense
    for the fiscal years ended June 30, 2000, 1999 and 1998, respectively.


                                       28
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    10.  Earnings Per Share and Cash Distributions 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,  which gives
    effect to a reduction for 85,744, 92,356 and 106,515 unallocated shares held
    by the ESOP, totaled 1,343,818, 1,355,501 and 1,340,049 for the fiscal years
    ended June 30, 2000, 1999 and 1998, 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.  Weighted-average  common shares deemed
    outstanding  for purposes of computing  diluted  earnings per share  totaled
    1,356,727, 1,397,814 and 1,376,664 for the fiscal years ended June 30, 2000,
    1999 and 1998,  respectively.  Incremental  shares  related  to the  assumed
    exercise of stock options  included in the  computation of diluted  earnings
    per share totaled 12,909,  42,313 and 36,615 for the fiscal years ended June
    30, 2000, 1999 and 1998, respectively.

    Options to purchase  5,952  shares of common  stock with a  weighted-average
    exercise  price  of  $12.89  were  outstanding  at June 30,  2000,  but were
    excluded from the computation of common share equivalents for the year ended
    June 30,  2000,  because the  exercise  prices were greater than the average
    market price of the common shares.

    During fiscal 1998, the  Corporation  paid cash  distributions  of $4.80 per
    share. Of these distributions, management deemed $4.50 per share as a return
    of capital,  charging such amount to additional  paid-in capital in the 1998
    consolidated  financial  statements.  The remaining  $.30 of the fiscal 1998
    distribution was accounted for as a normal quarterly cash dividend.

    11.  Cash and Cash Equivalents

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

    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.


                                       29
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    12.  Fair Value of Financial Instruments (continued)

    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,
    2000 and 1999:

                  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.

                  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, 2000 and 1999 was not material.


                                       30
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    12.  Fair Value of Financial Instruments (continued)

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

                                                              2000                               1999
                                                    Carrying         Fair              Carrying         Fair
                                                       value        value                 value        value
                                                                         (In thousands)
<S>                                                   <C>           <C>                  <C>            <C>
    Financial assets
      Cash and cash equivalents                     $  2,419     $  2,419              $  3,011     $  3,011
      Investment securities                            2,875        2,875                 2,924        2,924
      Mortgage-backed securities                      13,324       13,323                15,757       15,885
      Loans receivable                               102,939      103,425                87,382       87,537
      Federal Home Loan Bank stock                     1,652        1,652                 1,201        1,201
                                                     -------      -------               -------      -------

                                                    $123,209     $123,694              $110,275     $110,558
                                                     =======      =======               =======      =======

    Financial liabilities
      Deposits                                      $ 77,987     $ 77,401              $ 72,025     $ 72,519
      Advances from the Federal Home Loan Bank        30,412       30,177                23,616       23,598
                                                     -------      -------               -------      -------

                                                    $108,399     $107,578              $ 95,641     $ 96,117
                                                     =======      =======               =======      =======
</TABLE>

    13.  Advertising

    Advertising costs are expensed when incurred. The Corporation's  advertising
    expense for the fiscal  years  ended June 30,  2000,  1999 and 1998  totaled
    $56,000, $65,000 and $69,000, respectively.

    14.  Reclassifications

    Certain  prior year  amounts have been  reclassified  to conform to the 2000
    consolidated financial statement presentation.










                                       31
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


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, 2000 and 1999,
    are as follows:

<TABLE>
<CAPTION>
                                                                        June 30, 2000
                                                                  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          $3,000            $-                 $125         $2,875
                                                   =====             ==                 ===          =====

</TABLE>

<TABLE>
<CAPTION>
                                                                        June 30, 1999
                                                                  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          $3,000           $ -                 $ 76         $2,924
                                                   =====            ===                 ===          =====
</TABLE>


     The amortized  cost and  estimated  fair value of U. S.  Government  agency
obligations  designated  as  available  for  sale at June 30,  2000,  by term to
maturity are shown below.
<TABLE>
<CAPTION>


                                                                        Estimated
                                                      Amortized              fair
                                                           cost             value
                                                                (In thousands)
<S>                                                       <C>               <C>

    Due after one year through five years                $2,000            $1,923
    Due after five years through twenty years             1,000               952
                                                          -----             -----

                                                         $3,000            $2,875
                                                          =====             =====
</TABLE>







                                       32

<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


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

    The amortized cost, gross  unrealized  gains,  gross  unrealized  losses and
    estimated  fair value of  mortgage-backed  securities  at June 30,  2000 and
    1999, are shown below:
<TABLE>
<CAPTION>

                                                                                          2000
                                                                                 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                $ 3,779             $ 19             $ (34)       $ 3,764
      Government National Mortgage
        Association participation certificates                    410               14               -              424
                                                               ------              ---              ----         ------
         Total mortgage-backed securities
           held to maturity                                     4,189               33               (34)         4,188

    Available for sale:
      Federal National Mortgage
        Association participation certificates                  7,435              -                (347)         7,088
      Federal Home Loan Mortgage
        Corporation participation certificates                    189              -                  (1)           188
      Government National Mortgage
        Association participation certificates                  1,894              -                 (35)         1,859
                                                               ------              ---              ----         ------
         Total mortgage-backed securities
           available for sale                                   9,518              -                (383)         9,135
                                                               ------              ---              ----         ------

         Total mortgage-backed securities                     $13,707             $ 33             $(417)       $13,323
                                                               ======              ===              ====         ======
</TABLE>


<TABLE>
<CAPTION>
                                                                                          1999
                                                                                 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                $ 4,300             $102             $  (1)       $ 4,401
      Government National Mortgage
        Association participation certificates                    479               27                -             506
                                                               ------              ---              ----         ------
         Total mortgage-backed securities
           held to maturity                                     4,779              129                (1)         4,907

    Available for sale:
      Federal National Mortgage
        Association participation certificates                  8,256               -               (246)         8,010
      Federal Home Loan Mortgage
        Corporation participation certificates                    265               -                 (1)           264
      Government National Mortgage
        Association participation certificates                  2,709               -                 (5)         2,704
                                                               ------              ---              ----         ------
         Total mortgage-backed securities
           available for sale                                  11,230               -               (252)        10,978
                                                               ------              ---              ----         ------

         Total mortgage-backed securities                     $16,009             $129             $(253)       $15,885
                                                               ======              ===              ====         ======
</TABLE>


                                       33

<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


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

    The amortized cost of mortgage-backed securities, including those designated
    as available for sale at June 30, 2000, 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                                            $     214
    Due within five to ten years                                         3,338
    Due after ten years                                                 10,155
                                                                        ------

                                                                       $13,707
                                                                        ======
</TABLE>


NOTE C - LOANS RECEIVABLE

    The composition of the loan portfolio at June 30 is as follows:
<TABLE>
<CAPTION>

                                                                 2000           1999
                                                                    (In thousands)
<S>                                                            <C>              <C>
    Residential real estate
      One- to four-family                                    $ 67,761        $65,103
      Multi-family                                                785            721
    Nonresidential real estate and land                         1,504          1,925
    Commercial loans                                           30,723         18,989
    Consumer and other loans                                    2,966          1,650
                                                              -------         ------
                                                              103,739         88,388
    Less:
      Undisbursed portion of loans in process                   1,200          1,560
      Deferred loan origination fees                               46            142
      Allowance for loan losses                                   375            269
                                                              -------         ------

                                                             $102,118        $86,417
                                                              =======         ======
</TABLE>

    The Savings  Bank's  lending  efforts have  historically  focused on one- to
    four-family and multi-family  residential real estate loans,  which comprise
    approximately $67.3 million, or 66%, of the total loan portfolio at June 30,
    2000, and approximately  $64.3 million,  or 74%, of the total loan portfolio
    at June 30, 1999. Generally,  such loans have been underwritten on the basis
    of no more than an 80% loan-to-value ratio, which has historically  provided
    the Savings Bank with adequate  collateral coverage in the event of default.
    Nevertheless,  the Savings 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 Savings  Bank's
    primary lending area are presently stable.




                                       34
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE C - LOANS RECEIVABLE (continued)

    As  discussed  previously,  the  Savings  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  $9.1  million and $7.4  million at June 30, 2000 and
    1999, respectively.

    In the ordinary course of business,  the Savings 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  $294,000 and $444,000 at June
    30, 2000 and 1999, respectively.


NOTE D - ALLOWANCE FOR LOAN LOSSES

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

                                                    2000           1999           1998
                                                           (In thousands)
<S>                                                  <C>            <C>            <C>
    Beginning balance                               $269           $270           $270
    Provision for losses on loans                    106             -              -
    Loan charge-offs                                  -              (1)            -
                                                     ---            ---            ---

    Ending balance                                  $375           $269           $270
                                                     ===            ===            ===
</TABLE>


    As of June 30,  2000,  the  Savings  Bank's  allowance  for loan  losses was
    comprised  of a general  loan loss  allowance  totaling  $366,000,  which is
    includible  as a component of regulatory  risk-based  capital and a specific
    allowance totaling $9,000.

    Nonperforming and nonaccrual loans at June 30, 2000, 1999 and 1998,  totaled
    $225,000, $15,000 and $82,000, respectively. Interest income that would have
    been recognized had nonaccrual loans performed pursuant to contractual terms
    totaled  approximately  $12,000,  $1,000 and $2,000 for the years ended June
    30, 2000, 1999 and 1998, respectively.









                                       35
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE E - OFFICE PREMISES AND EQUIPMENT

    Office premises and equipment at June 30 is comprised of the following:
<TABLE>
<CAPTION>

                                                         2000           1999
                                                            (In thousands)
<S>                                                     <C>             <C>
    Land                                              $   323        $   323
    Buildings and improvements                            836            836
    Furniture and equipment                               606            579
                                                       ------         ------
                                                        1,765          1,738
      Less accumulated depreciation and
        amortization                                      512            374
                                                       ------         ------

                                                       $1,253         $1,364
                                                        =====          =====

</TABLE>





















                                       36
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE F - DEPOSITS

    Deposits consist of the following major classifications at June 30:
<TABLE>
<CAPTION>

    Deposit type and weighted-
    average interest rate                                                2000                            1999
                                                               Amount          %                  Amount        %
                                                                          (Dollars in thousands)
<S>                                                              <C>          <C>                   <C>         <C>
    NOW accounts
      2000 - 0.40%                                           $  9,543        12.3%
      1999 - 0.90%                                                                              $  8,290      11.5%
    Passbook
      2000 - 4.08%                                             24,666        31.6
      1999 - 3.54%                                                                                22,557      31.3
                                                               ------       -----                 ------     -----
    Total demand, transaction and
      passbook deposits                                        34,209        43.9                 30,847      42.8

    Certificates of deposit Original maturities of:
        One year or less
          2000 - 5.87%                                         14,316        18.3
          1999 - 4.66%                                                                             8,511      11.8
        12 months to 36 months
          2000 - 6.30%                                         24,469        31.4
          1999 - 5.60%                                                                            28,040      39.0
      Individual retirement accounts
        2000 - 5.79%                                            4,993         6.4
        1999 - 5.35%                                                                               4,627       6.4
                                                               ------       -----                 ------     -----

    Total certificates of deposit                              43,778        56.1                 41,178      57.2
                                                               ------       -----                 ------     -----

    Total deposit accounts                                    $77,987       100.0%               $72,025     100.0%
                                                               ======       =====                 ======     =====
</TABLE>

    The Savings Bank had certificate of deposit accounts with balances in excess
    of $100,000  totaling  $3.9  million  and $2.7  million at June 30, 2000 and
    1999, respectively.

    Interest expense on deposits at June 30 is summarized as follows:
<TABLE>
<CAPTION>

                                             2000            1999           1998
                                                       (In thousands)
<S>                                          <C>             <C>           <C>
    Passbook                               $  885          $  737         $  702
    NOW accounts                               68              81             98
    Certificates of deposit                 2,219           2,166          1,997
                                            -----           -----          -----

                                           $3,172          $2,984         $2,797
                                            =====           =====          =====
</TABLE>





                                       37
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE F - DEPOSITS (continued)

    Maturities of outstanding  certificates of deposit at June 30 are summarized
as follows:
<TABLE>
<CAPTION>

                                               2000                1999
                                                    (In thousands)
<S>                                           <C>                 <C>
    Less than one year                      $28,650             $28,262
    One year to two years                    12,736              11,025
    Two years to three years                  2,392               1,891
                                             ------              ------

                                            $43,778             $41,178
                                             ======              ======
</TABLE>


NOTE G - ADVANCES FROM THE FEDERAL HOME LOAN BANK

    Advances from the Federal Home Loan Bank, collateralized at June 30, 2000 by
    a pledge of certain  residential  mortgage  loans totaling $45.6 million and
    the  Savings  Bank's  investment  in  Federal  Home  Loan  Bank  stock,  are
    summarized as follows:
<TABLE>
<CAPTION>

    Interest                 Maturing in year
    rate                     ending June 30,              2000                1999
                                                            (Dollars in thousands)
<S>                                <C>                   <C>                 <C>
    6.83% - 7.35%                    2001              $12,000             $    -
    4.93% - 6.58%                    2004                2,500               2,500
    8.15%                            2005                   14                  17
    4.96% - 5.10%                    2008                   -               10,000
    5.06% - 6.32%                    After 2008         15,898              11,099
                                                        ------              ------

                                                       $30,412             $23,616
                                                        ======              ======

    Weighted-average interest rate                        6.48%               5.05%
                                                          ====                ====
</TABLE>











                                       38
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


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 as follows:
<TABLE>
<CAPTION>

                                                                   2000           1999           1998
                                                                         (Dollars in thousands)
<S>                                                                 <C>           <C>             <C>
    Federal income taxes at statutory rate                         $469           $369           $506
    Decrease in taxes resulting from:
      Other, primarily nontaxable interest income in 2000           (11)            (1)            (1)
                                                                    ---            ---            ---
    Federal income taxes per consolidated
      financial statements                                         $458           $368           $505
                                                                    ===            ===            ===

    Effective tax rate                                             33.2%          33.9%          33.9%
                                                                   ====           ====           ====
</TABLE>

    The composition of the  Corporation's  net deferred tax asset (liability) at
    June 30 is as follows:
<TABLE>
<CAPTION>


    Taxes (payable) refundable on temporary                 2000         1999
    differences at statutory rate:                           (In thousands)
<S>                                                         <C>          <C>
    Deferred tax assets:
      Deferred loan origination fees                        $ 15         $ 48
      Retirement expense                                      46           52
      General loan loss allowance                            124           91
      Unrealized losses on securities designated as
        available for sale                                   173          112
      Other                                                    3            1
                                                             ---          ---
         Deferred tax assets                                 361          304

    Deferred tax liabilities:
      Financed loan origination fees                         (70)        (105)
      Federal Home Loan Bank stock dividends                (179)        (143)
      Difference between book and tax depreciation           (20)         (17)
      Percentage of earnings bad debt deduction              (56)         (72)
      Mortgage servicing rights                              (22)         (19)
                                                             ---          ---
         Deferred tax liabilities                           (347)        (356)
                                                             ---          ---

         Net deferred tax asset (liability)                 $ 14         $(52)
                                                             ===          ===
</TABLE>

    The Savings 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,
    2000, include approximately $1.8 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, 2000.




                                       39
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE H - FEDERAL INCOME TAXES (continued)

    The Savings 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 Savings
    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.


NOTE I - LOAN COMMITMENTS

    The Savings 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 Savings Bank's involvement in such financial instruments.

    The Savings 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
    Savings  Bank  uses the same  credit  policies  in  making  commitments  and
    conditional obligations as those utilized for on-balance-sheet instruments.

    At  June  30,  2000,  the  Savings  Bank  had  outstanding   commitments  of
    approximately  $636,000 to originate loans.  Additionally,  the Savings Bank
    was obligated  under unused lines of credit  totaling  $8.1 million.  In the
    opinion of management,  all loan commitments  equaled or exceeded  prevalent
    market  interest  rates as of June 30, 2000,  and will be funded from normal
    cash flow from operations.


NOTE J - REGULATORY CAPITAL

    The  Savings  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 Savings Bank must meet specific capital  guidelines
    that  involve   quantitative   measures  of  the  Savings   Bank's   assets,
    liabilities,   and  certain  off-balance-sheet  items  as  calculated  under
    regulatory  accounting  practices.  The Savings Bank's  capital  amounts and
    classification  are also subject to qualitative  judgments by the regulators
    about components, risk weightings, and other factors.




                                       40
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE J - REGULATORY CAPITAL (continued)

    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 Savings 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%.

    During  the  2000  fiscal  year,  the  Savings  Bank was  notified  from its
    regulator that it was categorized as "well-capitalized" under the regulatory
    framework   for   prompt   corrective   action.   To   be   categorized   as
    "well-capitalized"  the Savings Bank must maintain minimum capital ratios as
    set forth in the following tables.

    As of June 30, 2000 and 1999,  management believes that the Savings Bank met
    all capital adequacy requirements to which it was subject.
<TABLE>
<CAPTION>

                                                        As of June 30, 2000
                                                                                         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            $15,519    12.3%         =>$1,897    =>1.5%          =>$6,323     => 5.0%

    Core capital                $15,519    12.3%         =>$5,058    =>4.0%          =>$7,587     => 6.0%

    Risk-based capital          $15,885    19.4%         =>$6,550    =>8.0%          =>$8,188     =>10.0%
</TABLE>


<TABLE>
<CAPTION>
                                                      As of June 30, 1999
                                                                                       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          $14,274    12.8%         =>$1,671    =>1.5%          =>$5,572    => 5.0%

    Core capital              $14,274    12.8%         =>$4,457    =>4.0%          =>$6,686    => 6.0%

    Risk-based capital        $14,543    21.5%         =>$5,404    =>8.0%          =>$6,755    =>10.0%
</TABLE>




                                       41
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE J - REGULATORY CAPITAL (continued)

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


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, 2000 and 1999, and the
    results of its  operations  and its cash flows for the years  ended June 30,
    2000, 1999 and 1998.

                            FFD Financial Corporation
<TABLE>
<CAPTION>
                        STATEMENTS OF FINANCIAL CONDITION
                                    June 30,
                                 (In thousands)

         ASSETS                                                          2000                1999
<S>                                                                     <C>                  <C>
    Cash and due from banks                                           $   136             $ 1,106
    Loan receivable from ESOP                                             838                 931
    Investment in First Federal Savings Bank of Dover                  15,190              14,064
    Accrued interest receivable                                            12                  14
    Prepaid federal income tax                                             57                  72
    Prepaid expenses and other assets                                      32                  17
                                                                       ------              ------

         Total assets                                                 $16,265             $16,204
                                                                       ======              ======

         SHAREHOLDERS' EQUITY

    Shareholders' equity
      Common stock                                                    $    -              $    -
      Additional paid-in capital                                        7,850               7,798
      Retained earnings                                                10,288               9,850
      Unrealized losses on securities designated as available
        for sale, net of related tax effects                             (335)               (216)
      Shares acquired by stock benefit plans                           (1,028)             (1,207)
      Treasury shares - at cost                                          (510)                (21)
                                                                       ------              ------

         Total shareholders' equity                                   $16,265             $16,204
                                                                       ======              ======
</TABLE>






                                       42
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998

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

                            FFD Financial Corporation
<TABLE>
<CAPTION>
                             STATEMENTS OF EARNINGS
                               Year ended June 30,
                                 (In thousands)
                                                         2000             1999              1998
<S>                                                      <C>               <C>              <C>
    Revenue
      Interest income                                  $   60             $ 54            $  377
      Equity in earnings of subsidiary                  1,002              833               888
                                                        -----              ---             -----
         Total revenue                                  1,062              887             1,265

    General and administrative expenses                   181              229               235
                                                        -----              ---             -----

         Earnings before income taxes (credits)           881              658             1,030

    Federal income taxes (credits)                        (41)             (59)               48
                                                        -----              ---             -----

         NET EARNINGS                                  $  922             $717            $  982
                                                        =====              ===             =====
</TABLE>


                            FFD Financial Corporation
<TABLE>
<CAPTION>
                            STATEMENTS OF CASH FLOWS
                               Year ended June 30,
                                 (In thousands)

                                                                                2000             1999              1998
<S>                                                                             <C>             <C>                <C>
    Cash provided by (used in) operating activities:
      Net earnings for the year                                               $  922           $  717           $   982
      Adjustments to reconcile net earnings to net
      cash provided by (used in) operating activities:
        Distributions from subsidiary in excess of earnings                       -               567                -
        Undistributed earnings of subsidiary                                  (1,001)              -               (888)
        Increase (decrease) in cash due to changes in:
          Prepaid expenses and other assets                                      (13)               6               121
          Other liabilities                                                       -                (4)               -
          Prepaid federal income taxes                                            15              (72)              (43)
                                                                               -----            -----            ------
          Net cash provided by (used in) operating activities                    (77)           1,214               172

    Cash flows provided by (used in) investing activities:
      Proceeds from repayment of loan to ESOP                                     93              116                84
      Proceeds from maturities of investment securities                           -                -             11,389
      Purchase of investment securities                                           -                -             (4,951)
                                                                               -----            -----            ------
          Net cash provided by investing activities                               93              116             6,522

    Cash flows provided by (used in) financing activities:
      Proceeds from exercise of stock options                                     27               76                10
      Purchase of treasury shares                                               (529)              -               (154)
      Cash distributions on common stock                                        (484)            (403)           (6,907)
                                                                               -----            -----            ------
          Net cash used in financing activities                                 (986)            (327)           (7,051)
                                                                               -----            -----            ------

    Net increase (decrease) in cash and cash equivalents                        (970)           1,003              (357)

    Cash and cash equivalents at beginning of year                             1,106              103               460
                                                                               -----            -----            ------

    Cash and cash equivalents at end of year                                  $  136           $1,106           $   103
                                                                               =====            =====            ======
</TABLE>







                                       43
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


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

    As a condition to regulatory  approval of the Conversion and  reorganization
    to the holding  company form of ownership,  the Savings Bank agreed to limit
    the amount of dividends  payable to the Corporation.  Regulations of the OTS
    impose   limitations   on  the  payment  of  dividends   and  other  capital
    distributions by savings associations. Generally, the Savings Bank's payment
    of dividends is limited,  without prior OTS approval,  to net income for the
    current  calendar year plus the two preceding  calendar years,  less capital
    distributions  paid over the  comparable  time  period.  The Savings 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.  During fiscal
    2000,  the  Savings  Bank  received  OTS  approval to make up to $400,000 in
    capital distributions during fiscal 2001.


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,  2000,  1999 and 1998,  would  have been  reduced  to the pro forma
    amounts indicated below:













                                       44
<PAGE>


                            FFD Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                          June 30, 2000, 1999 and 1998


NOTE L - STOCK OPTION PLAN (continued)
<TABLE>
<CAPTION>

                                                                2000         1999         1998
<S>                                       <C>                   <C>           <C>          <C>

Net earnings (In thousands)         As reported                 $922         $717         $982
                                                                 ===          ===          ===

                                      Pro-forma                 $920         $717         $963
                                                                 ===          ===          ===

Earnings per share
  Basic                             As reported                 $.69         $.53         $.73
                                                                 ===          ===          ===

                                      Pro-forma                 $.68         $.53         $.72
                                                                 ===          ===          ===

  Diluted                           As reported                 $.68         $.51         $.71
                                                                 ===          ===          ===

                                      Pro-forma                 $.68         $.51         $.70
                                                                 ===          ===          ===
</TABLE>

    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 2000, 1999 and 1998:
    dividend yield of 6.55%,  expected volatility of 20.0%, a risk-free interest
    rate of 6.0% and an expected life of ten years.

    A summary of the status of the  Corporation's  stock  option plan as of June
    30,  2000,  1999 and 1998,  and  changes  during  the years  then  ended are
    presented below:
<TABLE>
<CAPTION>

                                                    2000                      1999                     1998
                                                       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        117,883       $10.26      130,329       $10.15       118,432       $ 9.40
    Granted                                  18,635        10.11        3,000        14.63        12,635        17.19
    Exercised                                (2,967)        9.14       (8,066)        9.38          (738)       11.17
    Forfeited                               (24,013)       14.38       (7,380)       11.07           -            -
                                            -------        -----      -------        -----       -------        -----
      ----------

    Outstanding at end of year              109,538       $ 9.36      117,883       $10.26       130,329       $10.15
                                            =======        =====      =======        =====       =======        =====

    Options exercisable at year-end          52,017       $ 9.20       41,096       $ 9.86        22,948       $ 9.35
                                            =======        =====      =======        =====       =======        =====
    Weighted-average fair value of
      options granted during the year                     $ 1.18                    $ 1.71                     $ 2.01
                                                           =====                     =====                      =====
</TABLE>


    The following information applies to options outstanding at June 30, 2000:

    Number outstanding                                                  109,538
    Range of exercise prices                                     $9.14 - $14.59
    Weighted-average exercise price                                       $9.20
    Weighted-average remaining contractual life in years              6.8 years




                                       45
<PAGE>


                            FFD FINANCIAL CORPORATION
                                       AND
                       FIRST FEDERAL SAVINGS BANK OF DOVER
                        DIRECTORS AND EXECUTIVE OFFICERS

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


         Board of Directors of
     FFD Financial Corporation and                Executive Officers of
  First Federal Savings Bank of Dover          FFD Financial Corporation

           Stephen G. Clinton                       Robert R. Gerber
             Vice President                              President
       Tucker Anthony Cleary Gull
                                                   Shirley A. Wallick
            Robert R. Gerber                    Secretary and Treasurer
               President
First Federal Savings Bank of Dover and           Executive Officers of
       FFD Financial Corporation            First Federal Savings Bank of Dover

            J. Richard Gray                         Robert R. Gerber
                Chairman                                President
          Hanhart Agency, Inc.
                                                   Shiley A. Wallick
           Richard J. Herzig                     Secretary and Treasurer
           Chairman - Retired
   Toland-Herzig Funeral Homes, Inc.

             Enos L. Loader
          Financial Consultant
      Retired Senior Bank Officer

          Roy O. Mitchell, Jr.
       Managing Officer - Retired
  First Federal Savings Bank of Dover

            Robert D. Sensel
 President and Chief Executive Officer
         Dover Hydraulics, Inc.










                                       46
<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 17, 2000, at 1:00 p.m., Eastern Time, at the McDonald/Marlite Conference
Center,  143 McDonald Drive SW, New Philadelphia,  Ohio 44663.  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















                                       47