Exhibit
      99.1




















**For
      Release: Wednesday, January 17, 2007**




**Contact:**
              **Douglas
                  Stewart, President-CEO****Debra
                  Geuy, Chief Financial
                  Officer**





**PEOPLES-SIDNEY
      FINANCIAL CORPORATION ANNOUNCES**


**EARNINGS
      AND DIVIDEND**





Sidney,
      Ohio OTCBB - “PSFC”





Douglas
      Stewart, President and CEO of Peoples-Sidney Financial Corporation announced
      today the Corporation’s results for the second quarter of the fiscal year ending
      June 30, 2007 and the year to date results for the period ending December 31,
      2006, as well as declaration of its regular quarterly dividend to be paid to
      its
      shareholders.





Net
      income for the quarter ended December 31, 2006 was $280,000 compared to $285,000
      for the same period last year. Net income for both periods equaled $0.21 basic
      and diluted earnings per share. The decrease of $5,000 in net income for the
      current quarter was primarily due to a decrease of $25,000 in net interest
      income coupled with an increase of $8,000 in noninterest expense. The decrease
      in net interest income resulted from a decrease in the interest rate spread
      between interest earning assets and interest bearing liabilities. These
      decreases were partially offset by a decrease of $22,000 in provision for loan
      losses from $1,000 for the three months ended December 31, 2005 to a negative
      provision of $21,000 for the current period. The decrease in the provision
      resulted from a decrease in the balance of problem loans during the current
      period as compared to a year ago. Income tax expense also decreased
      $6,000.





The
      Corporation’s year to date net income for the six months ended December 31, 2006
      was $569,000, or $0.42 basic and diluted earnings per share. This compares
      to
      $525,000, or $0.38 basic and diluted earnings per share for the same period
      a
      year ago. This year to date comparison represents an increase in net income
      of
      $44,000, or 8.5% for the current year. For the six-month comparison, the
      Corporation realized a decrease of $87,000 in provision for loan losses from
      $18,000 for the six months ended December 31, 2005 to a negative provision
      of
      $69,000 for the current six months. This offset a decrease of





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      2





$21,000
      in net interest income, a decrease of $4,000 in noninterest income and an
      increase of $16,000 in income tax expense. The negative provision for loan
      losses was primarily the result of the positive resolution of a commercial
      loan
      that had a specific loss allocation of $80,000 at June 30, 2006.





Peoples-Sidney
      Financial Corporation had assets of $137.9 million and shareholders’ equity of
      $15.3 million as of December 31, 2006.





At
      its
      regular meeting held January 11, 2007, the Board of Directors declared a
      quarterly dividend of $0.16 per share for record holders as of January 31,
      2007.
      The payable date will be February 15, 2007.





Peoples-Sidney
      Financial Corporation is officially listed on the Over the Counter Bulletin
      Board (OTCBB) with the stock ticker symbol, “PSFC”.





When
      used
      in this press release or other public or shareholder communications, in filings
      by the Corporation with the Securities and Exchange Commission and in oral
      statements made with the approval of an authorized executive office, the words
      or phrases “should result,” “will likely result,” “will enable,” “are expected
      to,” “is anticipated,” “estimate,” “project” or similar expressions are intended
      to identify “forward-looking statements” within the meaning of the Private
      Securities Litigation Reform Act of 1995. Such statements are subject to certain
      risks and uncertainties, including changes in economic conditions in the
      Corporation’s market area, changes in policies by regulatory agencies,
      fluctuations in interest rates, demand for loans in the Corporation’s market
      area and competition, that could cause actual results to differ materially
      from
      historical results and those presently anticipated or projected. The Corporation
      wishes to caution readers not to place undue reliance on such forward-looking
      statements, which speak only as of the date made. The Corporation wishes to
      advise readers that the factors listed could affect the Corporation’s financial
      performance and could cause the Corporation’s actual results for future periods
      to differ materially from any opinions or statements expressed with respect
      to
      future periods in any current statements.





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