U.S. Securities and Exchange Commission

Washington, D.C.   20549

FORM 10-K

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

(Mark One)

[ X ]    Annual Report Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of
1934



For the fiscal year ended December 31, 1999

or

[   ]    Transition Report Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of
1934

For the Transition period from ___________________________ to
__________________________

Commission file Number 000-29283

United Bancshares, Inc.

(Exact name of registrant as specified in its charter)

|Ohio                                                            |  |            |  |                                   |  |  | 34-1516518
|--------------------------------------------------------------- |  | ---------- |  | --------------------------------- |  |  | ----------
|(State or other jurisdiction of

incorporation or organization) |  |            |  | (IRS Employer Identification No.)
|100 S. High Street

Columbus Grove, Ohio                        |  |            |  | 45830-1241                       
|(Address of principal executive offices)                        |  | (Zip Code)

Issuer's telephone number, including area code  (419) 659-2141

Securities registered under Section 12(b) of the Exchange Act:

|                    |  |  |                  |  | Name of each exchange on
|------------------- |  |  | ---------------- |  | ------------------------
|Title of each class |  |  | which registered
|None                |  |  |                  |  | None                    

Securities registered pursuant to 12(g) of the Exchange Act:

Common stock,  No Par Value

(Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.

Yes   ( X )         No   (    )

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K
(section 229.405) of this chapter is not contained herein, and will not be contained, to the best of
the registrant's knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K.   [ X ]

The issuer's common shares are not traded on any securities exchange and are not quoted by a
national quotation service.  Management is aware of a sale of the issuer's shares for $13.00 per
share on March 1, 2000.  Based upon such price, the aggregate market value of the issuer's shares
held by nonaffiliates was $24,048,011.

As of March 1, 2000, 2,238,363 common shares were issued and outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Annual Report to Shareholders for the year ended December 31, 1999 are
incorporated by reference into Parts I, II and IV.  Portions of the Registrant's Registration
Statement on Form S-4, Registration No. 333-86453 are incorporated by reference in Part IV.

PART I

Item 1.   Business

Forward Looking Statements

Certain matters disclosed herein may be deemed to be forward-looking statements that involve
risks and uncertainties, including regulatory policy changes, interest rate fluctuations, loan
demand, loan delinquencies and losses, and other risks.  Actual strategies and results in future
time periods may differ materially from those currently expected.  Such forward-looking
statements represent management's judgment as of the current date.  The Corporation disclaims,
however, any intent or obligation to update such forward-looking statements.

General

United Bancshares, Inc., an Ohio corporation (the "Corporation"), is a bank holding company
under the Bank Holding Company Act of 1956, as amended, and is subject to regulation by the
Board of Governors of the Federal Reserve System (the "Federal Reserve Board").  The
executive offices of the Corporation are located at 100 S. High Street, Columbus Grove, Ohio
45830.

Through its subsidiaries, The Union Bank Company, Columbus Grove, Ohio,  and The Bank of
Leipsic Company, Leipsic, Ohio, the Corporation is engaged in the business of commercial
banking.

General Description of Holding Company Subsidiaries and Recent Acquisition

The Union Bank Company is an Ohio state-chartered bank.  The main office of The Union Bank
Company is located in Columbus Grove, Ohio.  The Union Bank Company presently operates
two branch offices in Putnam County, Ohio (one in the village of Kalida, and one in the village
of Ottawa) and two branch offices in Allen County, Ohio (both in the city of Lima).  At
December 31, 1999, The Union Bank Company had 62 full-time equivalent employees.

On January 31, 2000, the Corporation consummated the acquisition of The Bank of Leipsic
Company ("Bank of Leipsic") and now operates the Bank of Leipsic as a second wholly-owned
subsidiary.  The Bank of Leipsic Company is also an Ohio state-chartered bank with its main
office located in Leipsic, Ohio and one branch office, also located in Leipsic.  Both offices are
located in Putnam County, Ohio.  At December 31, 1999, the Bank of Leipsic had (16) full-time
employees.

The Union Bank Company and Bank of Leipsic each offer a full range of commercial banking
services, including checking and NOW accounts; passbook savings and money market accounts;
time certificates of deposit, automatic teller machines; commercial, consumer, agricultural,
residential mortgage loans and home equity loans; credit card services; safe deposit box rentals;
and other personalized banking services.

As part of the acquisition of Bank of Leipsic, the Corporation filed a Registration Statement on
Form S-4 with the Securities and Exchange Commission (the "SEC").  This registration
statement also served the purpose of registering the Corporation as a Securities Exchange Act of
1934 (the "1934 Act") reporting company.  Following the acquisition of Bank of Leipsic, which
was acquired with Corporation common stock, the Corporation now has over 500 shareholders
and, under the 1934 Act, is required to become a reporting company.  The Corporation filed a
Form 8-A with SEC on February 1, 2000 to register as a 1934 Act reporting company.

Competition

The Union Bank Company and Bank of Leipsic experience significant competition in attracting
loan and deposit customers.  Competition in lending activities comes principally from other
commercial banks, savings associations, governmental agencies and credit unions.  The primary
factors in competing for loans are interest rates charged, levels of service provided, and structure
of terms.

Competition for deposits comes from other commercial banks, savings

associations, money market funds, credit unions, insurance companies, and

securities brokerage firms.  The primary factors in competing for deposits are

interest rates paid, account liquidity and convenience of office location.

Supervision and Regulation

The following is a summary of certain statutes and regulations affecting  the Corporation and its
subsidiaries.  The summary is qualified in its entirety by reference to such statutes and
regulations.

The Corporation is a bank holding company under the Bank Holding   Company Act of 1956, as
amended, which restricts the activities of the Corporation  and the acquisition by the Corporation
of voting shares or assets of any bank,  savings association or other company.  The Corporation is
also subject to the   reporting requirements of, and examination and regulation by, the Federal
Reserve  Board.  Subsidiary banks of a bank holding company are subject to certain  restrictions
imposed by the Federal Reserve Act  on transactions with affiliates,   including any loans or
extensions of credit to the bank holding company or any of its  subsidiaries, investments in the
stock or other securities thereof and the taking of  such stock or securities as collateral for loans
or extensions of credit to any borrower;  the issuance of guarantees, acceptances or letters of
credit on behalf of the bank  holding company and its subsidiaries; purchases or sales of
securities or other  assets; and the payment of money or furnishing of services to the bank
holding  company and other subsidiaries.  Bank holding companies are prohibited from
acquiring direct or indirect control of more than 5% of any class of voting stock or  substantially
all of the assets of any bank holding company without the prior approval  of the Federal Reserve
Board.  A bank holding company and its subsidiaries are   prohibited from engaging in certain
tying arrangements in connection with extensions  of credit and/or the provision of other property
or services to a customer by the bank  holding company or its subsidiaries.

As Ohio state-chartered banks, The Union Bank Company and Bank of Leipsic are  supervised
and regulated by the Ohio Division of Financial Institutions and the Federal Deposit  Insurance
Corporation ("FDIC").  The deposits of The Union Bank Company and Bank of  Leipsic are
insured by the FDIC and the banks are subject to the applicable provisions of the   Federal
Deposit Insurance Act.  A subsidiary of a bank holding company can be   liable to reimburse the
FDIC, if the FDIC incurs or anticipates a loss because of a  default of another FDIC-insured
subsidiary of the bank holding company or in   connection with FDIC assistance provided to such
subsidiary in danger of default.  In addition, the holding company of any insured financial
institution that submits a  capital plan under the federal  banking agencies' regulations on prompt
corrective  action guarantees a portion of the institution's capital shortfall, as discussed below.

Various requirements and restrictions under the laws of the United States  and the State of Ohio
affect the operations of the banks including requirements  to maintain reserves against deposits,
restrictions on the nature and amount of  loans which may be made and the interest that may be
charged thereon,   restrictions relating to investments and other activities, limitations on credit
exposure  to correspondent banks, limitations on activities based on capital and surplus,
limitations on payment of dividends, and limitations on branching.

The Federal Reserve Board has adopted risk-based capital guidelines for  bank holding
companies.  The risk-based capital guidelines include both a definition and  a framework for
calculating risk weighted assets by assigning assets and off-balance  sheet items to broad risk
categories.  The minimum ratio of total capital to risk   weighted assets (including certain off-balance sheet items, such as standby letters  of credit) is 8%.  At least 4.0% is to be comprised of
common stockholders' equity  (including retained earnings but excluding treasury stock),
noncumulative perpetual  preferred stock, a limited amount of cumulative perpetual preferred
stock, and  minority interests in equity accounts of consolidated subsidiaries, less goodwill and
certain other intangible assets ("Tier 1 capital").  The remainder ("Tier 2 capital") may  consist,
among other things, of mandatory convertible debt securities, a limited   amount of subordinated
debt, other preferred stock and a limited amount of   allowance for loan and lease losses.  The
Federal Reserve Board also imposes a  minimum leverage ratio (Tier 1 capital to total assets) of
3% for bank holding   companies and state member banks that meet certain specified conditions,
including having the highest regulatory rating.  The minimum leverage ratio is 1%-2%  higher for
other bank holding companies and state member banks based on their  particular circumstances
and risk profiles and those experiencing or anticipating  significant growth.  State non-member
bank subsidiaries, such as The Union Bank  Company and Bank of Leipsic, are subject to similar
capital requirements adopted  by the FDIC.

The Corporation and its subsidiaries currently satisfy all capital   requirements.  Failure to meet
applicable capital guidelines could subject a banking  institution to a variety of enforcement
remedies available to federal and state  regulatory authorities, including the termination of
deposit insurance by the FDIC.

The federal banking regulators have established regulations governing  prompt corrective action
to resolve capital deficient banks.  Under these regulations,  institutions which become
undercapitalized become subject to mandatory regulatory  scrutiny and limitations, which
increase as capital decreases.  Such institutions are  also required to file capital plans with their
primary federal regulator, and their holding  companies must guarantee the capital shortfall up to
5% of the assets of the capital  deficient institution at the time it becomes undercapitalized.

The ability of a bank holding company to obtain funds for the payment of  dividends and for
other cash requirements is largely dependent on the amount of  dividends which may be declared
by its subsidiary banks and other subsidiaries.    However, the Federal Reserve Board expects the
Corporation to serve as a source  of strength to its subsidiary banks, which may require it to
retain capital for further  investment in the subsidiaries, rather than for dividends for shareholders
of the   Corporation.  The Union Bank Company and Bank of Leipsic may not pay dividends to
the  Corporation if, after paying such dividends, it would fail to meet the required minimum
levels   under the risk-based capital guidelines and the minimum leverage ratio requirements.
The Union Bank Company and Bank of Leipsic must have the approval of its regulatory
authorities if a dividend in any year would cause the total dividends for that year to exceed   the
sum of the current year's net income and the retained net income for the preceding two   years,
less required transfers to surplus.  Payment of dividends by a bank subsidiary  may be restricted
at any time at the discretion of the regulatory authorities, if they  deem such dividends to
constitute an unsafe and/or unsound banking practice.    These provisions could have the effect of
limiting the Corporation's ability to pay  dividends on its outstanding common shares.

Deposit Insuance Assessments and Recent Legislation

The FDIC is authorized to establish separate annual assessment rates  for deposit insurance for
members of the Bank Insurance Fund ("BIF") and the   Savings Association Insurance Fund
("SAIF").  The Union Bank Company and the Bank of  Leipsic are members of BIF.  The FDIC
may increase assessment rates for either fund if   necessary to restore the fund's ratio of reserves
to insured deposits to its target  level within a reasonable time and may decrease such rates if
such target level has  been met.  The FDIC has established a risk-based assessment system for
both BIF  and SAIF members.  Under this system, assessments vary based on the risk the
institution poses to its deposit insurance fund.  The risk level is determined based on  the
institution's capital level and the FDIC's level of supervisory concern about the  institution.

Monetary Policy and Economic Conditions

The commercial banking business is affected not only by general   economic conditions, but also
by the policies of various governmental regulatory  authorities, including the Federal Reserve
Board.  The Federal Reserve Board  regulates money and credit conditions and interest rates in
order to influence  general economic conditions primarily through open market operations in
U.S.  Government securities, changes in the discount rate on bank borrowings and  changes in
reserve requirements against  bank deposits.  These policies and   regulations significantly affect
the overall growth and distribution of bank loans,  investments and deposits, and the interest rates
charged on loans as well as the  interest rates paid on deposits and accounts.

The monetary policies of the Federal Reserve Board have had a   significant effect on the
operating results of commercial banks in the past and are  expected to continue to have
significant effects in the future.  In view of the changing  conditions in the economy and the
money market and the activities of monetary and  fiscal authorities, no definitive predictions can
be made as to future changes in   interest rates, credit availability or deposit level.

Statistical Financial Information Regarding the Corporation

The following schedules and table analyze certain elements of the   consolidated balance sheets
and statements of income of the Corporation and its  subsidiaries, as required under Exchange
Act Industry Guide 3 promulgated by the  Securities and Exchange Commission, and should be
read in conjunction with the  narrative analysis presented in ITEM 7,  MANAGEMENT'S
DISCUSSION AND   ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATION and the

Consolidated Financial Statements of the Corporation and its subsidiaries.

I.   DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS'

EQUITY, INTEREST RATES AND INTEREST DIFFERENTIAL

A.  The following are the average balance sheets for the years ended December 31:

|ASSETS                               |                                   |                              | 1999                            | 1998                          | 1997                          
|------------------------------------ | --------------------------------- | ---------------------------- | ------------------------------- | ----------------------------- | ------------------------------
|                                     |                                   |                              |                                 |                               |                               
|Interest-earning assets              |                                   |                              |                                 |                              
|                                     | Securities available for sale (1) |                              |                                
|                                     | Taxable                           |                              | $   13,096,184                  | $   14,521,693                | $   19,501,633                
|                                     | Non-taxable                       | 14,059,829                   | 14,859,936                      | 6,848,088                    
|                                     | Federal funds sold                | 889,833                      | 1,094,534                       | 683,148                      
|                                     | Loans, net of unearned            |                              |                                 |                              
|                                     | income (2)                        |                              | 120,724,595 

----------------- | 94,389,237 

---------------- | 81,894,987 

-----------------
|                                     | Total interest-earning            |                              |                                 |                              
|                                     |                                   | assets                       | 148,770,441                     | 124,865,400                   | 108,927,856                   
|                                     | Allowance for loan losses         | (1,185,894)                  | (1,159,310)                     | (1,015,384)                  
|                                     |                                   |                              |                                 |                               |                               
|Noninterest-earning assets           |                                   |                              |                                
|                                     | Cash and due from banks           | 3,118,291                    | 2,542,247                       | 2,071,336                    
|                                     | Premises and equipment, net       | 3,662,856                    | 3,263,291                       | 1,977,920                    
|                                     | Accrued interest receivable and   |                              |                                
|                                     | other assets                      | 3,426,506

---------------   | 3,734,864 

----------------    | 2,435,108 

---------------  
|                                     |                                   |                              | $ 157,792,200

==========       | $ 133,246,492

==========     | $ 114,396,836 

===========   
|LIABILITIES AND SHAREHOLDERS' EQUITY |                                   |                             
|Interest-bearing liabilities         |                                   |                              |                                
|                                     | Deposits                          |                              |                                 |                               |                               
|                                     | Savings and interest-bearing      |                              |                                
|                                     | demand deposits                   | $  32,843,385                | $  30,243,411                   | $  29,778,863                
|                                     | Time deposits                     | 97,509,690                   | 80,068,040                      | 65,449,452                   
|                                     | Federal funds purchased           | 548,942                      | 496,213                         | 305,581                      
|                                     | Advances from Federal Home        |                              |                                 |                              
|                                     | Home Loan Bank (FHLB)             | 6,024,192

---------------   | 3,499,271

--------------       | 3,883,232 

---------------  
|                                     | Total interest-bearing            |                              |                                 |                              
|                                     | liabilities                       | 136,926,209                  | 114,306,935                     | 99,417,128                   
|Noninterest-bearing liabilities      |                                   |                              |                                
|                                     | Demand deposits                   | 9,992,949                    | 9,061,216                       | 6,890,966                    
|                                     | Accrued interest payable and      |                              |                                 |                              
|                                     | other liabilities                 | 760,342

---------------     | 339,139 

---------------       | 536,168 

--------------     
|                                     |                                   |                              | 147,679,500                     | 123,707,290                   | 106,844,262                   
|Shareholders' equity (3)             |                                   | 10,112,700 

--------------- | 9,539,202 

----------------    | 7,552,574 

---------------  
|                                     |                                   |                              | $ 157,792,200 

==========      | $ 133,246,492 

===========   | $ 114,396,836 

===========   

(1)  Securities available for sale are carried at fair value.  The average balance  includes quarterly
average balances of the market value adjustments and daily  average balances for the amortized
cost of securities.

(2)  Loan balances include principal balances of nonaccrual loans.

(3)  Shareholders' equity is shown net of average net unrealized appreciation  (depreciation) on
securities available for sale, net of tax.

I.  DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDER' EQUITY;
INTEREST RATES AND INTEREST DIFFERENTIAL (CONTINUED)

B.  The following tables set forth, for the years indicated, the condensed  average balances of
interest-earning assets and interest-bearing  liabilities, the interest earned or paid on such
amounts, and the  average interest rates earned or paid thereon.

|                                    |                         |                                 | 1999                          
|----------------------------------- | ----------------------- | ------------------------------- | ------------------------------
|                                    |                         |                                 | Average                       
|                                    |                         |                                 | Balance                       
|INTEREST-EARNING ASSETS             |                         |                                 |                               
|                                    | Securities (1)          |                                 |                               
|                                    | Taxable                 |                                 | $   13,096,184                
|                                    | Non-taxable (2)         | 14,059,829                      | 1,074,130                     
|                                    | Federal funds sold      | 889,833                         | 42,066                        
|                                    | Loans, net of unearned  |                                 |                               
|                                    | income (4)              | 120,724,595

----------------   | 10,225,434 

-----------------
|                                    | Total earning assets    | 148,770,441

----------------   | 12,223,733 

-----------------
|                                    |                         |                                 |                               
|INTEREST-BEARING LIABILITIES        |                         |                                 |                               
|                                    | Deposits                |                                 |                               
|                                    | Savings and interest-   |                                 |                               
|                                    | bearing demand          |                                 |                               
|                                    | deposits                | 32,843,385                      | 836,689                       
|                                    | Time Deposits           | 97,509,690                      | 5,007,690                     
|                                    | Federal funds purchased | 548,942                         | 28,813                        
|                                    | Advances from FHLB      | 6,024,192

----------------     | 341,049 

---------------     
|                                    | Total interest-bearing  |                                 |                               
|                                    | liabilities             | $ 136,926,209

---------------- | 6,214,241 

----------------  
|                                    |                         |                                 |                               
|Net interest income                 |                         |                                 | $     6,009,492 

=========== 
|Net interest income as a percent of |                         |                                 |                               
|of average interest-earning assets  |                         |                                 | 4.04%

=======                

(1) Securities balances represent daily average balances for the amortized cost of securities.  The
average rate is calculated based on the amortized cost of securities.

(2)  Computed on tax equivalent basis for non-taxable secretes (34% statutory tax rate in 1999)

(3)  Loan balances include principal balances of nonaccrual loans.

(4)  Interest income on loans includes fees on loans of $262,014 in 1999.

I.  DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDER' EQUITY;
INTEREST RATES AND INTEREST DIFFERENTIAL (CONTINUED)

|                                    |                         |               | 1998                        
|----------------------------------- | ----------------------- | ------------- | ----------------------------
|                                    |                         |               | Average                     
|                                    |                         |               | Balance                     
|INTEREST-EARNING ASSETS             |                         |               |                             
|                                    | Securities (1)          |               |                             
|                                    | Taxable                 |               | $   14,521,693              
|                                    | Non-taxable (2)         | 14,859,936    | 1,155,564                   
|                                    | Federal funds sold      | 1,094,534     | 58,599                      
|                                    | Loans, net of unearned  |               |                             
|                                    | income (4)              | 94,389,237    | 8,567,145                   
|                                    | Total earning assets    | 124,865,400   | 10,798,140                  
|                                    |                         |               |                             
|INTEREST-BEARING LIABILITIES        |                         |               |                             
|                                    | Deposits                |               |                             
|                                    | Savings and interest-   |               |                             
|                                    | bearing demand          |               |                             
|                                    | deposits                | 30,243,411    | 842,063                     
|                                    | Time Deposits           | 80,068,040    | 4,474,785                   
|                                    | Federal funds purchased | 496,213       | 25,009                      
|                                    | Advances from FHLB      | 3,499,271     | 214,851                     
|                                    | Total interest-bearing  |               |                             
|                                    | liabilities             | $ 114,306,935 | 5,556,708                   
|                                    |                         |               |                             
|Net interest income (2)             |                         |               | $     5,241,432 

==========
|Net interest income as a percent of |                         |               |                             
|of average interest-earning assets  |                         |               | 4.20%                       
|                                    |                         |               |                             

(1)  Securities balances represent daily average balances for the amortized

cost of securities.  The average rate is calculated based on the amortized

cost of securities.

(2)  Computed on tax equivalent basis for non-taxable secretes (34%

statutory tax rate in 1998).

(3)  Loan balances include principal balances of nonaccrual loans.

(4)  Interest income on loans includes fees on loans of $286,028 in 1998.

I.  DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDER' EQUITY;
INTEREST RATES AND INTEREST DIFFERENTIAL (CONTINUED)

|                                    |                         |                                     | 1997                         
|----------------------------------- | ----------------------- | ----------------------------------- | -----------------------------
|                                    |                         |                                     | Average                      
|                                    |                         |                                     | Balance                      
|INTEREST-EARNING ASSETS             |                         |                                     |                              
|                                    | Securities (1)          |                                     |                              
|                                    | Taxable                 |                                     | $   19,501,633               
|                                    | Non-taxable (2)         | 6,848,088                           | 550,261                      
|                                    | Federal funds sold      | 683,148                             | 37,251                       
|                                    | Loans, net of unearned  |                                     |                              
|                                    | income (4)              | 81,894,987

---------------         | 7,457,127 

--------------   
|                                    | Total earning assets    | 108,927,856 

----------------      | 9,465,409 

---------------- 
|                                    |                         |                                     |                              
|INTEREST-BEARING LIABILITIES        |                         |                                     |                              
|                                    | Deposits                |                                     |                              
|                                    | Savings and interest-   |                                     |                              
|                                    | bearing demand          |                                     |                              
|                                    | deposits                | 29,778,863                          | 870,614                      
|                                    | Time Deposits           | 65,449,452                          | 3,753,390                    
|                                    | Federal funds purchased | 305,581                             | 15,634                       
|                                    | Advances from FHLB      | 3,883,232 

--------------          | 240,624

-------------       
|                                    | Total interest-bearing  |                                     |                              
|                                    | liabilities             | $   99,417,128 

------------------ | 4,880,262 

--------------   
|                                    |                         |                                     |                              
|Net interest income (2)             |                         |                                     | $     4,585,147 

===========
|Net interest income as a percent of |                         |                                     |                              
|of average interest-earning assets  |                         |                                     | 4.21%

========              

(1)  Securities balances represent daily average balances for the amortized cost of securities.
The average rate is calculated based on the amortized cost of securities.

(2)  Computed on tax equivalent basis for non-taxable secretes (34%statutory tax rate in 1997).

(3)  Loan balances include principal balances of nonaccrual loans.

(4)  Interest income on loans includes fees on loans of $240,861 in 1997.

I.  DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDER' EQUITY;
INTEREST RATES AND INTEREST DIFFERENTIAL (CONTINUED)

C.  The following tables set forth the effect of volume and rate changes on interest  income and
expenses for the periods indicated.  For purposes of these tables,  changes in interest due to
volume and rate were determined as follows:

Volume Variance - change in volume multiplied by the previous year's rate.       Rate Variance -
change in rate multiplied by the previous year's volume.

Rate/Volume Variance - change in volume multiplied by the change in rate.

This variance was allocated to volume variances and rate variances in proportion to the
relationship of the absolute dollar amount of the change in each.

Interest on non-taxable securities has been adjusted to a fully tax equivalent basis using a
statutory tax rate of 34% in all years presented.

|                    |                               |                              | Total                          |                           |                        
|------------------- | ----------------------------- | ---------------------------- | ------------------------------ | ------------------------- | -----------------------
|                    |                               |                              | Variance                       | Variance Attributable To 
|                    |                               |                              | 1999/1998                      | Volume                    | Rate                   
|INTEREST INCOME     |                               |                              |                                |                          
|                    | Securities -                  |                              |                                |                           |                        
|                    | Taxable                       |                              | $       (134,729)              | $         (97,078)        | $         (37,651)     
|                    | Non-taxable                   | (81,434)                     | (61,395)                       | (20,039)                 
|                    | Federal funds sold            | (16,533)                     | (10,170)                       | (6,363)                  
|                    | Loans, net of unearned income | 1,658,289

--------------    | 2,180,347 

--------------     | (522,058)

------------- 
|                    |                               |                              | 1,425,593 

---------------    | 2,011,704 

------------- | (586,111)

------------
|                    |                               |                              |                                |                           |                        
|INTEREST EXPENSE    |                               |                              |                                |                          
|                    | Deposits -                    |                              |                                |                           |                        
|                    | Savings and interest-         |                              |                                |                          
|                    | bearing demand                |                              |                                |                          
|                    | deposits                      | (5,374)                      | (494,628)                      | 489,254                  
|                    | Time deposits                 | 532,905                      | 848,869                        | (315,964)                
|                    | Federal funds purchased       | 3,804                        | 2,737                          | (1,067)                  
|                    | Advances from FHLB            | 126,198

-----------         | 141,481 

-----------          | (15,283)

-----------    
|                    |                               |                              | 657,533

-----------           | 498,459

----------       | 156,940

-----------   
|                    |                               |                              |                                |                           |                        
|NET
INTEREST INCOME | $        768,060

=========== | $     1,513,245

=========== | $       (743,051)

===========

I.  DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDER' EQUITY;
INTEREST RATES AND INTEREST DIFFERENTIAL (CONTINUED)

|                    |                                |                                | Total                            |                            |                         
|------------------- | ------------------------------ | ------------------------------ | -------------------------------- | -------------------------- | ------------------------
|                    |                                |                                | Variance                         | Variance Attributable To  
|                    |                                |                                | 1998/1997                        | Volume                     | Rate                    
|INTEREST INCOME     |                                |                                |                                  |                           
|                    | Securities -                   |                                |                                  |                            |                         
|                    | Taxable                        |                                | $       (403,938)                | $       (350,567)          | $         (53,371)      
|                    | Non-taxable                    | 605,303                        | 622,444                          | (17,140)                  
|                    | Federal funds sold             | 21,348                         | 22,012                           | (664)                     
|                    | Loans, net of unearned income  | 1,110,018

-------------       | 1,133,949 

--------------       | (23,931)

--------------  
|                    |                                |                                | 1,332,731 

-------------        | 1,427,838 

-------------- | (95,106)

--------------
|INTEREST EXPENSE    |                                |                                |                                  |                           
|                    | Deposits -                     |                                |                                  |                            |                         
|                    | Savings and interest-          |                                |                                  |                           
|                    | bearing demand                 |                                |                                  |                           
|                    | deposits                       | (28,551)                       | 13,866                           | (42,417)                  
|                    | Time deposits                  | 721,395                        | 814,245                          | (92,850)                  
|                    | Federal funds purchased        | 9,375                          | 9,604                            | (229)                     
|                    | Advances from FHLB             | (25,773)

-------------        | (23,593)

------------           | (2,180)

-------------    
|                    |                                |                                | 676,446 

-------------          | 814,122 

-----------      | (137,676)

-------------
|                    |                                |                                |                                  |                            |                         
|NET INTEREST INCOME | $        656,285 

=========== | $        613,716 

=========== | $           42,570 

===========

II.  INVESTMENT PORTFOLIO

A.  The book value of securities available for sale as of December 31 are summarized as
follows:

|                                    |                             |                            | 1999                        | 1998                       | 1997                       
|----------------------------------- | --------------------------- | -------------------------- | --------------------------- | -------------------------- | ---------------------------
|U. S. Treasury and U. S. Government |                             |                            |                            
|agency securities                   |                             | $     2,200,609            | $     3,156,526             | $     5,384,712           
|Obligations of states and political |                             |                            |                            
|subdivisions                        |                             | 14,683,784                 | 19,896,037                  | 10,526,579                
|Mortgage-backed securities          | 7,863,965                   | 10,156,829                 | 9,570,970                  
|Marketable equity securities        | 1,242,433

---------------- | 1,301,037 

-------------- | 1,734,830 

-------------- 
|                                    |                             |                            | $   25,990,791 

========== | $   34,510,429

========== | $   27,217,091 

==========

B.  The maturity distribution and weighted average yield of securities available for sale at
December 31, 1999 are as follows:

|                       |                           | Maturing                       
|---------------------- | ------------------------- | -------------------------------
|                       |                           |                                
|                       |                           | Within                         
|                       |                           | One Year                       
|U. S. Treasury and     |                           |                                
|U. S. Government       |                           |                                
|agency securities      | $                       - | $     1,493,210                
|Obligations of states  |                           |                                
|and political          |                           |                                
|subdivisions (1)       | -                         | 543,780                        
|Mortgage-backed        |                           |                                
|securities (2)         | 133,278                   | 2,925,901                      
|Marketable equity      |                           |                                
|securities             | -

--------------         | - 

--------------             
|                       |                           | $          133,278 

==========
|                       |                           |                                
|Weighted average yield | 7.48%

========           | 6.62%

========                

(1)   Yields are not presented on a tax-equivalent basis.

(2)  Maturity based upon estimated weighted-average life.

The weighted average interest rates are based on coupon rates for securities purchased  at par value
and on effective interest rates considering amortization or accretion if the  securities were purchased
at a premium or discount.

C.  Excluding those holdings of the investment portfolio in U.S. Treasury securities and other
agencies of the U. S. Government, there were no securities of any one issuer which exceeded 10%
of the shareholders' equity of the Corporation at December 31, 1999.

III.  LOAN PORTFOLIO

A.  Types of Loans - Total loans on the balance sheet are comprised of the following classifications
at December 31 for the years indicated:

|                                | 1999                        | 1998                        | 1997                         | 1996                        | 1995                       
|------------------------------- | --------------------------- | --------------------------- | ---------------------------- | --------------------------- | ---------------------------
|Commercial and agricultural -   |                             |                             |                             
|                                | $   63,864,857              | $     49,303,580            | $   38,759,000               | $   30,382,000              | $   24,836,000             
|Real estate mortgage -          |                             |                             |                              |                            
|                                | 50,132,861                  | 44,418,051                  | 32,609,000                   | 29,519,000                  | 19,851,000                 
|Consumer loans to individuals - |                             |                             |                             
|                                | 14,920,807

--------------  | 14,773,611 

-------------- | 15,098,593 

--------------  | 14,643,033 

-------------- | 7,907,935 

-------------  
|                                | $ 128,918,525 

=========== | $  108,495,242
===========  | $   86,466,593 

=========== | $   74,544,033 

========== | $   52,594,935 

==========

CONCENTRATIONS OF CREDIT RISK - The Corporation's subsidiary grants commercial, real
estate and installment loans to customers mainly in northwestern Ohio.  Commercial loans  include
loans collateralized by business assets and agricultural loans collateralized by crops  and farm
equipment.  As of December 31, 1999, commercial and agricultural loans make up   approximately
49% of the loan portfolio; the loans are expected to be repaid from cash flow  from operations of the
businesses.  As of December 31, 1999, residential first mortgage  loans make up approximately 39%
of the loan portfolio and are collateralized by first   mortgages on residential real estate.  As of
December 31, 1999, consumer loans to   individuals make up approximately 12% of the loan
portfolio and are primarily collateralized  by consumer assets.

B.  Maturities and Sensitivities of Loans to Changes in Interest Rates - The following  table shows
the amounts of commercial and agricultural loans outstanding as of  December 31, 1999 which,
based on remaining scheduled repayments of   principal, are due in the periods indicated.  Also, the
amounts have been  classified according to sensitivity to changes in interest rates for commercial and
agricultural loans due after one year.  (Variable-rate loans are those loans with  floating or adjustable
interest rates.)

| |                                      |            |                | Commercial    
| | ------------------------------------ | ---------- | -------------- | --------------
| |                                      |            |                | and           
| | Maturing                             |            | Agricultural  
| | Within one year                      |            | $   15,744,029
| | After one year but within five years | 44,408,380
| | After five years                     |            | 3,712,448     
| |                                      |            |                | $   63,864,857

Commercial and Agricultural

| |                        |                           | Interest Sensitivity        |                           
| | ---------------------- | ------------------------- | --------------------------- | --------------------------
| |                        |                           | Fixed                       | Variable                  
| |                        |                           | Rate                        | Rate                      
| | Due after one year but |                           |                             |                           
| | within five years      | $     6,205,951           | $   38,202,429              | $   44,408,380            
| | Due after five years   | 3,281,368

-------------- | 431,080 

-------------     | 3,712,448 

------------- 
| |                        |                           | $     9,487,319

========== | $   38,633,509

==========

C.  Risk Elements

1.  Nonaccrual, Past Due, Restructured and Impaired Loans -

The following table summarizes nonaccrual, past due, restructured and impaired loans at December
31:

|                                                                                  | 1999                          | 1998                             | 1997                           | 1996                          | 1995                         
|--------------------------------------------------------------------------------- | ----------------------------- | -------------------------------- | ------------------------------ | ----------------------------- | -----------------------------
|( a) Loans accounted for on a nonaccrual basis -                                  |                               |                                 
|                                                                                  | $        348,000              | $          539,000               | $           55,000             | $        201,000              | $           52,000           
|( b) Accruing loans which are contractually past due 90 days or more as to       
|interest or principal payments -                                                  |                               |                                  |                               
|                                                                                  | 898,000                       | 305,000                          | 739,000                        | 1,015,000                     | 89,000                       
|( c) Loans not included in (a) or (b) which are "Troubled Debt Restructurings" as
|defined by Statements of Financial Accounting Standards No. 15 -                  |                              
|                                                                                  | -                             | -                                | -                              | -                             | -                            
|( d) Other loans defined as "impaired" -                                          |                               |                                  |                               
|                                                                                  | -

--------------             | -

--------------                | - 

---------------            | - 

-------------             | - 

--------------           
|                                                                                  | $     1,246,000 

=========== | $          844,000 

=========== | $        794,000 

=========== | $     1,216,000 

=========== | $        141,000 

==========

Management believes the allowance for loan losses at December 31, 1999 is adequate to absorb any
losses on nonperforming loans, as the allowance balance is maintained by management at a level
considered adequate to cover losses that are currently anticipated based on past loss experience,
general economic conditions, information about specific borrower situations including their financial
position and collateral values, and other factors and estimates which are subject to change over time.

| |                                                                     |                                |                          |                    | 1999          
| | ------------------------------------------------------------------- | ------------------------------ | ------------------------ | ------------------ | --------------
| |                                                                     |                                |                          |                    | (in thousands)
| | Gross interest income that would have been recorded in 1999 on     
| | nonaccrual loans outstanding at December 31, 1999 if the loans     
| | had been current, in accordance with their original terms and had  
| | been outstanding throughout the period or since origination if held
| | for part of the period                                              |                                |                          | $           25,201
| |                                                                     |                                |                          |                    |               
| | Interest income actually recorded on nonaccrual loans and           |                               
| | included in net income for the period                               |                                | (12,352)

--------------
| |                                                                     |                                |                          |                    |               
| | Interest income not recognized during the period                    | $           12,849 

=========

1.  Discussion of the Nonaccrual Policy  The accrual of interest income is discontinued when the
 collection of a loan or interest, in whole or in part, is doubtful.  When interest accruals are
discontinued, interest income   accrued in the current period is reversed.  While loans which  are past
due 90 days or more as to interest or principal payments  are considered for nonaccrual status,
management may elect to  continue the accrual of interest when the estimated net  realizable value
of collateral, in management's judgment, is  sufficient to cover the principal balance and accrued
interest.  These policies apply to both commercial and consumer loans.

2.  Potential Problem Loans   As of December 31, 1999, in addition to the $1,246,000 of loans
reported under Item III, C.1., there are approximately $5,435,875  in other outstanding loans where
known information causes   management to have serious doubts as to the ability of such  borrowers
to comply with the present loan repayment terms and  which may result in disclosure of such loans
pursuant to   Item III, C.1., at some future date.  Consideration was given to   loans classified for
regulatory purposes as loss, doubtful,  substandard, or special mention that have not been disclosed
in  Section 1 above.  To the extent that such loans are not included  in the $5,435,875 potential
problem loans described above,  management believes that such loans will not materially impact
future operating results, liquidity, or capital resources.

3.  Foreign Outstandings

None

4.  Loan Concentrations  At December 31, 1999, loans outstanding relating to agricultural
operations or collateralized by agricultural real estate aggregated  approximately $21,871,499.  At
December 31, 1999, there were  no agricultural loans which were accounted for on a nonaccrual
basis; and there are no accruing agriculture loans which are  contractually past due ninety days or
more as to interest or   principal payments.

D.  Other Interest-Bearing Assets  Other than $150,779 in foreclosed real estate, there are no other
interest-bearing assets as of December 31, 1999 which would be  required to be disclosed under Item
III, C.1 or 2 if such assets  were loans.

IV.  SUMMARY OF LOAN LOSS EXPERIENCE

A.  The following schedule presents an analysis of the allowance for

loan losses, average loan data and related ratios for the years

ended December 31:

|                          |                                 |                             | 1999                         | 1998                          | 1997                   
|------------------------- | ------------------------------- | --------------------------- | ---------------------------- | ----------------------------- | -----------------------
|LOANS                     |                                 |                             |                              |                              
|                          | Loans outstanding at end        |                             |                              |                              
|                          | of period (1)                   | $ 128,918,525

==========   | $ 108,495,242 

===========  | $   86,578,577 

=========== 
|                          | Average loans outstanding       |                             |                              |                              
|                          | during period (1)               | $ 120,724,595

===========  | $   94,389,237 

=========== | $   81,894,987 

=========== 
|ALLOWANCE FOR LOAN LOSSES |                                 |                            
|                          | Balance at beginning of period  | $     1,198,103             | $     1,107,522              | $        995,539             
|                          | Loans charged off -             |                             |                              |                              
|                          | Commercial and agricultural     | (81,000)                    | (40,000)                     | (94,000)                     
|                          | Real estate mortgage            | (65,000)                    | -                            | -                            
|                          | Consumer loans to               |                             |                              |                              
|                          | individuals                     | (185,938)

-------------    | (134,419)

--------------    | (175,017)

-------------     
|                          |                                 |                             | (331,938)

------------      | (174,419)

------------       | (269,017)

------------
|                          | Recoveries of loans previously  |                             |                             
|                          | charged off -                   |                             |                              |                              
|                          | Commercial and agricultural     | 15,000                      | 31,000                       | 220,000                      
|                          | Real estate mortgage            | 2,000                       | -                            | -                            
|                          | Consumer loans to               |                             |                              |                              
|                          | individuals                     | 40,000

---------------     | 54,000 

-------------       | 31,000 

-------------       
|                          |                                 |                             | 57,000 

---------------     | 85,000 

-------------        | 251,000 

-------------
|                          | Net loans charged off           | (274,938)                   | (89,419)                     | (18,017)                     
|                          | Provision for loan losses       | 283,850

--------------     | 180,000 

------------       | 130,000 

------------       
|                          |                                 |                             |                              |                               |                        
|                          | Balance at end of period        | $     1,207,015

========== | $     1,198,103

==========  | $     1,107,522 

===========
|                          |                                 |                             |                              |                               |                        
|                          | Ratio of net charge-offs during |                             |                              |                              
|                          | the period to average loans     |                             |                              |                              
|                          | outstanding during the period   | 0.23%

======               | 0.09%

======                | 0.02%

======                

IV.  SUMMARY OF LOAN LOSS EXPERIENCE (CONTINUED)

|                          |                                 |                             | 1996                        | 1995                   
|------------------------- | ------------------------------- | --------------------------- | --------------------------- | -----------------------
|LOANS                     |                                 |                             |                            
|                          | Loans outstanding at end        |                             |                            
|                          | of period (1)                   | $   74,544,033

=========   | $   52,594,935 

========= 
|                          | Average loans outstanding       |                             |                            
|                          | during period (1)               | $   62,620,000

=========   | $   48,048,000

=========  
|ALLOWANCE FOR LOAN LOSSES |                                
|                          | Balance at beginning of period  | $        755,773            | $        791,971           
|                          | Loans charged off -             |                             |                            
|                          | Commercial and agricultural     | (648,000)                   | (29,000)                   
|                          | Real estate mortgage            | -                           | -                          
|                          | Consumer loans to               |                             |                            
|                          | individuals                     | (97,235)

-------------     | (53,198)

-------------    
|                          |                                 |                             | (745,235)

-------------    | (82,198)

-------------
|                          | Recoveries of loans previously  |                            
|                          | charged off -                   |                             |                            
|                          | Commercial and agricultural     | 41,000                      | 18,000                     
|                          | Real estate mortgage            | -                           | -                          
|                          | Consumer loans to               |                             |                            
|                          | individuals                     | 31,000

-------------       | 8,000

-------------       
|                          |                                 |                             | 72,000 

-------------      | 26,000

-------------  
|                          | Net loans charged off           | (673,235)                   | (56,198)                   
|                          | Provision for loan losses       | 913,000

-------------      | 20,000

-------------      
|                          |                                 |                             |                             |                        
|                          | Balance at end of period        | $        995,538

========= | $        755,773

=========
|                          |                                 |                             |                             |                        
|                          | Ratio of net charge-offs during |                             |                            
|                          | the period to average loans     |                             |                            
|                          | outstanding during the period   | 1.08%

======               | 0.12%

======              

(1) Net of unearned income

IV.  SUMMARY OF LOAN LOSS EXPERIENCE (CONTINUED)

The allowance for loan losses balance and the provision for loan  losses are judgmentally determined
by management based upon  periodic reviews of the loan portfolio.  In addition, management
considered the level of charge-offs on loans as well as the  fluctuations of charge-offs and recoveries
on loans including the  factors which caused these changes.  Estimating the risk of loans  and the
amount of loss is necessarily subjective.  Accordingly,  the allowance is maintained by management
at a level considered  adequate to cover losses that are currently anticipated based on  past loss
experience, general economic conditions, information  about specific borrower situations including
their financial  position and collateral value and other factors and estimates  which are subject to
change over time.  The increase in loans  charged-off in 1996 as compared to the other periods
presented  is due largely to the charge-off of a particular credit.

IV.  SUMMARY OF LOAN LOSS EXPERIENCE (CONTINUED)

B.  The following schedule is a breakdown of the allowance for loan losses allocated by type of loan
and related ratios.

|                  |                        | Allocation of the Allowance for Loan Losses
|----------------- | ---------------------- | -------------------------------------------
|                  |                        |                                            
|                  |                        |                                            
|                  |                        |                                            
|                  |                        | Allowance                                  
|                  |                        | Amount                                     
|                  |                        | December 31, 1999                          
|Commercial and    |                        |                                            
|agricultural      | $          434,558     | 49.5%                                      
|Residential first |                        |                                            
|mortgages         | 68,997                 | 38.9%                                      
|Consumer loans to |                        |                                            
|individuals       | 118,174                | 11.6%                                      
|Unallocated       | 585,286

------------- | N/A  

-------------                       
|                  |                        | $       1,207,015 

========               
|                  |                        |                                            
|                  |                        | December 31, 1997                          
|Commercial and    |                        |                                            
|agricultural      | $          398,738     | 44.8%                                      
|Residential first |                        |                                            
|mortgages         | 63,310                 | 37.7%                                      
|Consumer loans to |                        |                                            
|individuals       | 108,433                | 17.5%                                      
|Unallocated       | 537,041

------------- | N/A  

-------------                       
|                  |                        | $       1,107,522 

========               
|                  |                        |                                            
|                  |                        | December 31, 1995                          
|Commercial and    |                        |                                            
|agricultural      | $          272,099     | 47.2%                                      
|Residential first |                        |                                            
|mortgages         | 43,203                 | 37.7%                                      
|Consumer loans to |                        |                                            
|individuals       | 73,995                 | 15.0%                                      
|Unallocated       | 366,477

------------- | N/A  

-------------                       
|                  |                        | $          755,774

========               

While management's periodic analysis of the adequacy of the  allowance for loan losses may allocate
portions of the allowance  for specific problem loan situations, the entire allowance is   available for
any loan charge-offs that occur.

V.  DEPOSITS

The average amount of deposits and average rates paid are summarized as follows for the years
ended December 31:

|                      |                             | 1999                         | 1998                      
|--------------------- | --------------------------- | ---------------------------- | --------------------------
|                      |                             | Average                      | Average                   
|                      |                             | Amount                       | Rate                      
|Savings and interest- |                             |                              |                           
|bearing demand        |                             |                              |                           
|deposits              | $     32,843,385            | 2.55%                        | $   30,243,411            
|Time deposits         | 97,509,690                  | 5.14%                        | 80,068,040                
|Demand deposits       |                             |                              |                           
|(noninterest bearing) | 9,992,949

---------------  | -                            | 9,061,216 

--------------
|                      |                             | $  140,346,024 

=========== |                           
|                      |                             |                              |                           
|                      |                             | 1997                         |                           
|                      |                             | Average                      | Average                   
|                      |                             | Amount                       | Rate                      
|Savings and interest- |                             |                              |                           
|bearing demand        |                             |                              |                           
|deposits              | $     29,778,863            | 2.92%                        |                           
|Time deposits         | 65,449,452                  | 5.73%                        |                           
|Demand deposits       |                             |                              |                           
|(noninterest bearing) | 6,890,966

---------------- | -                            |                           
|                      |                             | $  102,119,281 

=========== |                           

Maturities of time certificates of deposit and other time deposits of $100,000 or more outstanding
at December 31, 1999 are summarized as follows:

| |                                           |           |                         | Amount                   
| | ----------------------------------------- | --------- | ----------------------- | -------------------------
| | Three months or less                      |           | $     4,827,000        
| | Over three months and through six months  | 2,335,000
| | Over six months and through twelve months | 2,273,000
| | Over twelve months                        |           | 980,000 

-------------
| |                                           |           |                         | $   10,415,000 

========

VI.  RETURN ON EQUITY AND ASSETS

The ratio of net income to average shareholders' equity and average total assets and certain other
ratios are as follows:

| |                                  |                              | 1999                                 | 1998                                | 1997                        
| | -------------------------------- | ---------------------------- | ------------------------------------ | ----------------------------------- | ----------------------------
| | Average total assets             | $ 157,792,200

==========    | $ 133,246,492
==========             | $ 114,396,836 

==========         
| | Average shareholders' equity (1) | $   10,112,700

==========   | $     9,539,202 

==========         | $     7,552,574 

==========       
| | Net income                       |                              | $     1,336,235 

==========         | $     1,319,567 

==========        | $     1,380,476 

==========
| | Cash dividends declared          | $        393,341

========== | $                     - 

========== | $                    - 

==========
| |                                  |                              |                                      |                                     |                             
| | Return on average total assets   | 0.85%

======                | 0.99%

======                        | 1.21%

======                      
| | Return on average                |                              |                                      |                                    
| | shareholders' equity             | 13.21%

======               | 13.83%

======                       | 18.28%

======                     
| | Dividend payout percentage (2)   | 29.44%

======               | 0.00%

======                        | 0.00%

======                      
| | Average shareholders' equity (1) |                              |                                     
| | to average total assets          | 6.41%

======                | 7.16%

======                        | 6.60%

======                      

(1) Net of average unrealized appreciation or depreciation on securities available for sale.

(2) Dividends declared divided by net income.

VII.  SHORT-TERM BORROWINGS

The Corporation had borrowings from the Federal Home Loan Bank  for which the average balance
outstanding during the reported periods  was greater than 30 percent or more of shareholders' equity
at the end   of the reported periods.  These borrowings are discussed in Note J of  United Bancshares'
Annual Report to Shareholders for 1999 ("Annual  Report"), which is included herein as Exhibit 1.

Effect of Environmental Regulation

Compliance with federal, state and local provision regulating the discharge of  materials into the
environment, or otherwise relating to the protection of the environment,   has not had a material
effect upon the capital expenditures, earnings or competitive position  of the Corporation and its
subsidiary.  The Corporation believes that the nature of the  operations of its subsidiary has little, if
any, environmental impact.  The Corporation, therefore, anticipates no material capital expenditures
for environmental control facilities for its current  fiscal year or for the foreseeable future.  The
Corporation's subsidiary may be required  to  make capital expenditures for environmental control
facilities related to properties which they  may acquire through foreclosure proceedings in the future;
however, the amount of such capital expenditures, if any, is not currently determinable.

Item 2.  Properties

The following is a listing and brief description of the properties owned by The

Union Bank Company and used in its business:

1.  Its main office is a two-story brick building located at 100 South High Street, Columbus Grove,
Ohio.  The building was constructed in approximately 1900 and contains approximately 7,870 square
 feet.

2.  A full service branch office is located at 110 East North Street, Kalida, Ohio.  The building was
constructed in 1994 and contains approximate 2,540 square feet.

3.  A full service branch office is located at 245 West Main Street, Ottawa, Ohio.  The building was
constructed in 1991 and contains approximately 2,400 square feet.

4.  A full service branch office is located at 3211 Elida Road, Lima, Ohio.  The building was
constructed in 1994 and contains approximately 4,000 square feet.

5.  A full service branch office is located at 1410 Bellefontaine Avenue, Lima, Ohio.  The building
was constructed in 1998 and contains approximately 4,200 square feet.

6.  A drive-thru facility is located at 200 East Sycamore Street, Columbus Grove, Ohio.  The
building was constructed in 1973 and contains approximately 480 square feet.

7.  A building located at 120 South High Street, Columbus Grove, Ohio was purchased in December
1999.  The building had been constructed in approximately 1930.  It is a two-story building and

contains approximately 3,900 square feet.  The intention is to renovate this facility and operate it as
an operations center.

The following is a listing and brief description of the properties owned by Bank of

Leipsic and used in its business:

1.  Its main office is located at 142 East Main Street, Leipsic, Ohio

2.  A drive-thru facility is located at 326 South Belmore Street, Leipsic, Ohio

Item 3.  Legal Proceedings

There are no pending legal proceedings to which the Corporation or its subsidiaries is a party to or
to which any of their property is subject except routine legal proceedings to which the Corporation
or its subsidiaries are a party incidental to its banking business.  None of such proceedings are
considered by the Corporation to be material.

Item 4.  Submission of Matters to a Vote of Security Holders

During December 1999, shareholders of both The Corporation and Bank of Leipsic voted to approve
a merger whereby Bank of Leipsic would become a wholly-owned subsidiary of the Corporation.
Upon receiving required regulatory approval, the merger was consummated January 31, 2000.
Former shareholders of Bank of Leipsic received 54.25 shares of the Corporation's stock in exchange
for each share previously owned.

Further information relating to this transaction is reflected in Note P of the Annual Report to
Shareholders for 1999 ("Annual Report"), which is included herein as Exhibit 13.

Executive Officers of the Registrant (subsequent to acquisition of Bank of Leipsic)

Subsequent to the acquisition of Bank of Leipsic, the following table lists the names and ages of the
executive officers of the Corporation and its subsidiaries as of March 1, 2000, the positions presently
held by each such executive officer and the business experience of each such executive officer

during the past five years.  Unless otherwise indicated, each person has held his principal
occupation(s) for more than five years.  All executive officers serve at the pleasure of the Board of
Directors of the Corporation.

|                  |     |                                                                                                                                                                                                                          | Position(s) Held with the Corporation and                                                                                           
|----------------- | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------
|Name              | Age | its Subsidiary and Principal Occupation(s)                                                                                                                                                                              
|James N. Reynolds | 62  | Chairman of the Board of Directors of the                                                                                                                                                                               
|                  |     |                                                                                                                                                                                                                          | Corporation; Chairman of the Board of Directors                                                                                     
|                  |     |                                                                                                                                                                                                                          | of Bank of Leipsic.                                                                                                                 
|                  |     |                                                                                                                                                                                                                          |                                                                                                                                     
|E. Eugene Lehman  | 58  | President and Chief Executive Officer of the
Corporation; Director of the Corporation; Chairman
of the Board of Directors of The Union Bank
Company; Chief Executive Officer of The Union
Bank Company since July, 1998.
|                  |     |                                                                                                                                                                                                                         
|                  |     |                                                                                                                                                                                                                         
|                  |     |                                                                                                                                                                                                                         
|                  |     |                                                                                                                                                                                                                         
|Carl L. McCrate   | 75  | Secretary-Treasurer of the Corporation; Director                                                                                                                                                                        
|                  |     |                                                                                                                                                                                                                          | of the Corporation; Retired Owner of Hardware                                                                                       
|                  |     |                                                                                                                                                                                                                          | Store.                                                                                                                              
|                  |     |                                                                                                                                                                                                                          |                                                                                                                                     
|Daniel W. Schutt  | 52  | Director of the Corporation; Director of The Union                                                                                                                                                                      
|                  |     |                                                                                                                                                                                                                          | Bank Company; President of The Union Bank
Company; President and Chief Executive Officer
of Antwerp Exchange Bank from 1984 to 1998.
|                  |     |                                                                                                                                                                                                                          |                                                                                                                                     
|Larry D. Place    | 53  | President and Chief Executive Officer of Bank                                                                                                                                                                           
|                  |     |                                                                                                                                                                                                                          | of Leipsic.                                                                                                                         

PART II

Item 5.  Market for Registrant's Common Equity and Related Shareholders' Matters

There is currently no established trading market for the Corporation's common stock.  Because the
Corporation is not public, the stock often trades without the Corporation having knowledge of the
trade.  The Corporation knows that there were trades in its stock during 1998 and 1999 of which it
was not aware.  The trades that it is aware of from the market makers in the Corporation's stock are

those outlined.  The prices given are interdealer without retail markups, markdowns or commissions.
All numbers on the following tables are adjusted to give effect to the four-for-one stock split of June
1, 1998.

| |                |                   |                    | Dividend              
| | -------------- | ----------------- | ------------------ | ----------------------
| | 1998           | High              | Low                | Per Share             
| | First Quarter  | $           10.25 | $             9.50 | $                    -
| | Second Quarter | 11.50             | 10.32              | -                     
| | Third Quarter  | 13.00             | 11.50              | -                     
| | Fourth Quarter | 14.75             | 14.00              | -                     
| | 1999           |                   |                    |                       
| | First Quarter  | $           16.50 | $           16.25  | $                    -
| | Second Quarter | 19.00             | 17.38              | 0.11                  
| | Third Quarter  | 19.00             | 17.25              | 0.11                  
| | Fourth Quarter | 17.25             | 16.25              | 0.11                  

Subsequent to the acquisition of Bank of Leipsic and related issuance of additional shares, there were
651 shareholders of record.

Item 6.  Selected Financial Data

The information required herein is incorporated by reference from page 4 of United Bancshares'
Annual Report to Shareholders for 1999 ("Annual Report"), which is included herein as Exhibit 13.

Item 7.  Management's Discussion and Analysis of Financial Condition and Results of Operations

The information required herein is incorporated by reference from page 5 of United Bancshares'
Annual Report to Shareholders for 1999 ("Annual Report"), which is included herein as Exhibit 13.

Item 7a.  Quantitative and Qualitative Disclosures About Market Risk

The information required herein is incorporated by reference from page 10 of United Bancshares'
Annual Report to Shareholders for 1999 ("Annual Report"), which is included herein as Exhibit 13.

Item 8.  Financial Statements and Supplementary Data

The information required herein is incorporated by reference from page 13 of United Bancshares'
Annual Report to Shareholders for 1999 ("Annual Report"), which is included herein as Exhibit 13.

Item 9.  Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Not Applicable.

PART III

Item 10.  Directors and Executive Officers of the Registrant

Following the acquisition of Bank of Leipsic, the directors and officers of the Corporation are as
follows.  Directors are elected to annual terms and officers serve at the pleasure of the Board of

Directors.

| | Directors - |  |                     |                           
| | ----------- |  | ------------------- | --------------------------
| |             |  | Joe S. Edwards, Jr. | Investor/Attorney         
| |             |  | Thomas J. Erhart    | Retired/Insurance Agency  
| |             |  | E. Eugene Lehman    | Banking                   
| |             |  | Carl L. McCrate     | Retired/Hardware Retailing
| |             |  | William R. Perry    | Farmer                    
| |             |  | James N. Reynolds   | Banking                   
| |             |  | H. Edward Rigel     | Farmer                    
| |             |  | Daniel W. Schutt    | Banking                   
| |             |  |                     |                           
| | Officers -  |  |                     |                           
| |             |  | James N. Reynolds   | Chairman                  
| |             |  | E. Eugene Lehman    | President                 
| |             |  | Carl L. McCrate     | Secretary-Treasurer       

Item 11.  Executive Compensation

The following table reflects the cash compensation paid by the Corporation and its subsidiary to the
following individuals.  No other officer's total compensation exceeded $100,000 for 1999.

Summary Compensation Table

|                |      |               |         |                    | Other              |              |     | 
|--------------- | ---- | ------------- | ------- | ------------------ | ------------------ | ------------ | --- | 
|Name and        |      |               |         | Annual             | Long Term          |              |    
|Principal       |      |               |         | Compen-            | Compen-            | All Other   
|Position        | Year | Salary        | Bonus   | sation             | sation             | Compensation
|Chief Executive |      |               |         |                    |                    |              |    
|Officer -       | 1999 | $ 108,460     | $15,000 | $                - | $                - | 32,484       | (2)
|E. Eugene       | 1998 | 84,896        | 10,500  | -                  | -                  | 25,415       | (2)
|Lehman          | 1997 | 92,690        | 20,402  | -                  | -                  | 26,083       | (2)
|                |      |               |         |                    |                    |              |     | 
|President and   |      |               |         |                    |                    |              |    
|Chief Executive |      |               |         |                    |                    |             
|Officer of The  |      |               |         |                    |                    |              |    
|Union Bank -    | 1999 | 97,653        | 5,500   | 8,467              | (1)              - | 18,686       | (3)
|Daniel W.       | 1998 | 43,269        | 23,000  | 2,944              | (1)              - | 9,612        | (3)
|Schutt          | 1997 | (5)         - | -       | -                  | -                  | -            |    

(1)  The amount reflected as "Other Annual Compensation" for Mr. Schutt represents the value of
personal use of a corporate automobile and, in 1999, the cost of an airline ticket

for his spouse.

(2)  Amounts included as "All Other Compensation for Mr. Lehman consist of a discretionary
contribution to the 401(k) plan; a matching contribution to the 401(k) plan; and an accrual to the
Corporation's supplemental employee retirement plan.

(3)  Amounts included as "All Other Compensation for Mr. Schutt consist of a discretionary

contribution to the 401(k) plan; a matching contribution to the 401(k) plan; and an

accrual to the Corporation's supplemental employee retirement plan.

(4)  Benefits classified as Other Annual Compensation that did not exceed the lesser of $50,000 or
10% of the named executive's annual salary and bonus are not reported.

(5)  Mr. Schutt's employment with the Corporation began July 1, 1998.

|Aggregated Option/SAR Exercises in 1999
|---------------------------------------
|and December 31, 1999 Option/SAR Value 
|                                       
|                                       
|                                       
|Name                                   
|E. Eugene                              
|Lehman                                 
|Daniel W.                              
|Schutt                                 

Item 12.  Security Ownership of Certain Beneficial Owners and Management

The following table sets forth those shareholders as of March 1, 2000 who owned more than five
percent of the common stock of United Bancshares, Inc.:

| | Name of             | Amount and Nature of     | Percent of |        
| | ------------------- | ------------------------ | ---------- | -------
| | Beneficial Owner    | Beneficial Ownership (1) | Class      |        
| | Joe S. Edwards, Jr. |                          | 185,101    |        
| | Lima, Ohio          |                          |            |        
| | CEDE & Co.          |                          |            | 166,906
| | New York, New York  |                          |            |        

The following table sets forth, as of March 1, 2000, certain information concerning the beneficial
ownership of common shares by each director of the Corporation and by each of the executive
officers named in the Summary Compensation Table and by all current executive officers and
directors of the Corporation as a group.

| | Name of                   | Amount and Nature of     | Percent of |    
| | ------------------------- | ------------------------ | ---------- | ---
| | Beneficial Owner          | Beneficial Ownership (1) | Class      |    
| | Joe S. Edwards, Jr.       |                          | 185,101    |    
| | Thomas J. Erhart          |                          | 40,957     | (3)
| | E. Eugene Lehman          |                          | 14,747     | (4)
| | Carl L. McCrate           |                          | 12,873     | (6)
| | William R. Perry          |                          | 28,264     |    
| | James N. Reynolds         |                          | 56,420     | (7)
| | H. Edward Rigel           |                          | 15,190     | (8)
| | Daniel W. Schutt          |                          | 150        |    
| | All current directors and |                          |            |    
| | executive officers as a   |                          |            |    
| | group (9 persons)         |                          | 388,516    | (9)

(1)  Unless otherwise noted, the beneficial owner has sole voting and investment power with respect
to all of the common shares reflected in the table.

(2)  The percent of class is based upon 2,291,681 shares outstanding as of March 1, 2000.   (3)
Includes 13,575 shares held by the Thomas J. Erhart Trust as to which Mr. Erhart has sole voting and
investment powers.  Does not include 6,751 shares owned by Mr. Erhart's wife as to which she
exercises sole voting and investment power.

(4)  Does not include 132 shares owned by Mr. Lehman's wife as to which she exercises sole voting
and investment power.

(5)  Reflects ownership of less than 1% if the outstanding common shares of the Corporation.

6)  Does not include 9,771 shares owned by Mr. McCrate's wife as to which she exercises sole voting
and investment power.

(7)  Includes 56,420 shares held by the James N. Reynolds Trust as to which Mr. Reynolds has sole
voting and investment powers.  Does not include 4,340 shares owned by a trust for Mr. Reynolds'
wife for which she exercises sole voting and investment power.

(8)  Includes 15,190 shares held by a trust for Mr. Rigel  as to which Mr. Rigel shares joint voting
and investment powers.  Does not include 15,135 shares owned by a trust for Mr. Rigel's wife for
which she exercises joint voting and investment power.

(9)  Includes common shares jointly held by directors and executive officers and other persons.  Also
includes an aggregate of 18,268 shares allocated to the respective accounts of executive officers of
the Corporation in the Employee Stock Ownership Plan ("KSOP").  Does not include common
shares held by wives of directors and executive officers.

Item 13.  Certain Relationships and Related Transactions

In the ordinary course of conducting its business, the Corporation, for itself or through its subsidiary,
may engage in transactions with the directors, employees, and managers of the Corporation or of The
Union Bank Company which may include, but not be limited to, loans.  As required by and in
compliance with Ohio banking law, all banking transactions with directors, employees or managers
of the Corporation are conducted on the same basis and terms as would be provided to any other
bank customer.  No amounts of these related transactions exceeded $60,000 in 1999.  In addition,
each of these transactions was made on terms similar to those that could have been negotiated with
an unaffiliated third party.

PART IV

Item 14.  Exhibits, Financial Statement Schedules, and Reports on Form 8-K

(a)  1.  Financial Statements -

The information required herein is incorporated by reference from the United Bancshares' Annual
Report to Shareholders for 1999 ("Annual Report"), which is included herein as Exhibit 13.

2.  Financial Statement Schedules - None

3.  Exhibits Required by Item 601 Regulation S-K -

| | Exhibit No. | Exhibit Description                                            |  | 
| | ----------- | -------------------------------------------------------------- |  | 
| | 3.1         | Articles of Incorporation (1)                                  |  | 
| | 3.2         | Regulations (1)                                                |  | 
| | 10          | Agreement and Plan of Reorganization dated April 20, 1999     
| |             | by and between United Bancshares, Inc. and The Bank of Leipsic
| |             | Company (1)                                                    |  | 
| | 13          | Annual Report, pages 4 to 36                                   |  | 
| | 21          | United Bancshares, Inc. Subsidiaries                           | 
| | 23.1        | Consent of Accountant                                          |  | 
| | 27          | Financial Data Schedule                                        |  | 

(1)  Incorporated by reference to Registrant's Registration Statement on Form S-4; Registration No.
333-86453.

(b)  Reports of Form 8-K -

None

|SIGNATURES                                                                               
|-----------------------------------------------------------------------------------------
|                                                                                         
|                                                                                         
|Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the
|undersigned, thereunto duly authorized.                                                  
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Date:                                                                                    
|                                                                                         
|                                                                                         
|has been signed below by the following persons on behalf of the Registrant and in the    
|capacities and on the dates indicated.                                                   
|                                                                                         
|Signatures                                                                               
|/s/ JOE S. EDWARDS, JR.                                                                  
|Joe S. Edwards, Jr.                                                                      
|                                                                                         
|/s/ THOMAS J. ERHART                                                                     
|Thomas J. Erhart                                                                         
|                                                                                         
|/s/ E. EUGENE LEHMAN                                                                     
|E. Eugene Lehman                                                                         
|                                                                                         
|/s/ CARL L. MCCRATE                                                                      
|Carl L. McCrate                                                                          
|                                                                                         
|/s/ WILLIAM R. PERRY                                                                     
|William R. Perry                                                                         
|                                                                                         
|/s/ JAMES N. REYNOLDS                                                                    
|James N. Reynolds                                                                        
|                                                                                         
|/s/ H. EDWARD RIGEL                                                                      
|H. Edward Rigel                                                                          
|                                                                                         
|/s/ DANIEL W. SCHUTT                                                                     
|Daniel W. Schutt                                                                         

EXHIBIT 13

UNITED BANCSHARES, INC.

1999 ANNUAL REPORT

TABLE OF CONTENTS



President's Letter

Five Year Performance Summary

Management's Discussion and Analysis

Earnings Summary

Results of Operations

1999 Compared with 1998

1998 Compared with 1997

Liquidity

Asset Liability Management

Effects of Inflation

Quantitative and Qualitative Disclosures about Market Risk

Forward-Looking Statements

Acquisition of The Bank of Leipsic

Independent Auditors' Report

Consolidated Balance Sheets

Consolidated Statements of -

Income

Stockholders' Equity

Cash Flows

Notes to Consolidated Financial Statements

United Bancshares, Inc. (Parent Only)

Balance Sheet

Statements of

Income

Stockholders' Equity

Cash Flows

Directors

Officers

United Bancshares, Inc.

100 South High Street

Columbus Grove, Ohio 45830

www.theubank.com

419/659-2141

Fellow Stockholders:

In 1999 United Bancshares enjoyed a 16.4% increase in Net Interest Income, a 23.3% increase in
Noninterest Income, a 9.4% increase in Total Assets, and an 18.8% increase in Loans.  The Y2K
prophecies did not materialize, in fact, the concern about technology glitches motivated most of
our industry to increase our investment in people and equipment, thereby positioning ourselves
for better utilization of technology in the future.

The acquisition of the Bank of Leipsic was not finalized until February 1, 2000, however,
throughout 1999 preparation for the acquisition demanded both banks attention.  The Union
Bank continued to grow, reducing Total Risk-Based Capital to Risk-Weighted Assets to 9.1%.
The regulatory "Adequately Capitalized" minimum is 8.0%.  With the acquisition completed
equity capital will be reallocated to support growth, pushing Union Bank's Total Risk Weighted
assets to equity above the 10% Well Capitalized minimum.  All other capital ratios of both Union
Bank and Bank of Leipsic are already in excess of the regulatory "Well Capitalized" minimums.
Additionally, as both banks shrunk their Investment Securities portfolios and increased their
Loans, Bank of Leipsic retained Investments with an average duration of 4.6 years while Union
Bank retained longer Investment maturities but with comparatively higher after-tax yields.
Combining the two similar sized portfolios will reduce the average duration of the portfolio.  The
acquisition, although dilutive in the short term, positions your company to take advantage of
anticipated opportunities to grow value in the future.  As McDonald Equity Research reported in
their February 10, 2000 Industry Review: "1999 marked one of the worst years ever for bank
stock investing."  We are confident that the investment in Bank of Leipsic will allow us to grow
earnings and stockholder value beyond our ability to do so without the acquisition.

Our strategic direction remains firm.  To deliver optimum value, we must meet the expectations
of our customers if we are to meet the expectations of our stockholders.  We must both evolve
continuously in our utilization of technology as well as expand the "brick and mortar" service
options available to our customers.  We cannot fail to grow our company if we remain committed
to growing the value of our stockholders' investment.  We will aggressively pursue stockholder
value through increased efficiencies, internal growth, and acquisitions.

Sincerely,

E. Eugene Lehman

President

|UNITED BANCSHARES, INC.                  
|-----------------------------------------
|COLUMBUS GROVE, OHIO                     
|                                         
|FIVE YEAR PERFORMANCE SUMMARY            
|                                         
|                                         
|Income and Expense (000's)               
|                                         
|                                         
|                                         
|                                         
|                                         
|                                         
|Per Common Share Data                    
|                                         
|                                         
|                                         
|Balance Sheet (Year end balances - 000's)
|                                         
|                                         
|                                         
|Operating Ratios                         
|                                         
|                                         
|                                         
|                                         
|                                         
|Credit Quality                           
|                                         
|                                         
|                                         
|                                         
|                                         
|Common Stock                             
|                                         
|                                         
|                                         
|                                         
|Form 10-K                                

| | The Corporation will provide without charge to each shareholder, upon written request to United
Bancshares, Inc., 100 S. High St., Columbus Grove, Ohio, 45830, Attention: Bonita J. Selhorst, a
copy of the Corporation's Annual Report on Form 10-K, including the Financial Statements and
Schedules thereto required to be filed with the Securities and Exchange Commission, for the
Corporation's most recent fiscal year.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
|
|

UNITED BANCSHARES, INC.

MANAGEMENT'S DISCUSSION AND ANALYSIS

Of Financial Condition and Results of Operations

EARNINGS SUMMARY

Consolidated net income for United Bancshares, Inc. (the "Company") for 1999 was $1.34
million, compared with $1.32 million in 1998 and $1.38 million in 1997.  Basic earnings per
share were $1.12 in 1999, decrease of 1.8% from $1.14 in 1998.  The 1998 basic earnings per
share results represented a 11.6% decrease from $1.29 in 1997.  Per share data has been adjusted
to reflect the stock dividends paid in all three years as well as the four-for-one stock split
declared in May 1998.

RESULTS OF OPERATIONS

1999 Compared With 1998

Net interest income for 1999 was $5.64 million, an increase of $.8 million (16.4%) over 1998.
The increase was primarily due to a 27.9% increase in the average balance of total loans.  The
average yield on loans declined to 8.47% compared to 9.08% for 1998.  The average rate on
interest-bearing liabilities declined to 4.54% from 4.86% in 1998.  The combination of these
factors resulted in the net interest margin on earning assets declining from 4.19% in 1998 to
4.04% in 1999.

At December 31, 1999, total loans amounted to $128.9 million, an increase of 18.8% over the
December 31, 1998 balance of $108.5 million.  This increase was due to the Company's loan
origination efforts and the increased presence in the Lima market.

The Company elects to sell in the secondary market a portion of the residential mortgage loans
that it originates.  These are primarily fixed rate loans and, typically, the servicing rights are
retained.  During 1999, gains of $58.3 thousand were recognized on such sales, a decrease of
66.0% over the 1998 amount of $171.5 thousand.

Securities available for sale totaled $26.0 million at December 31, 1999 which represented a
decrease of $8.5 million (24.7%) from total securities of  $34.5 million at December 31, 1998.
As of December 31, 1999, all securities of the Company were designated available for sale.
Available for sale securities represent those securities that the Company may decide to sell if
needed for liquidity, asset/liability management or other reasons.  Such securities are reported at
fair value with net unrealized appreciation/(depreciation) included as a separate component of
shareholders' equity, net of tax.  At December 31, 1999, this resulted in $1.494 million as a net
decrease in shareholders' equity.

Total deposits at December 31, 1999 were $141.3 million, an increase of $10.3 million (7.9%)
over total deposits of $131.0 million at December 31, 1998.  The increase is a result of cross-selling efforts with existing customers coupled with the increased expansion into the Lima
market.

Other borrowings at December 31, 1999 were $14.9 million compared to $10.6 million at
December 31, 1998.  These borrowings were comprised of $14.6 million of FHLB advances and
$0.3 million of other borrowings.  The Company utilizes these alternative sources of funding to
support its asset growth.

The allowance for loan losses at December 31, 1999 was $1.2 million (0.94% of total loans)
compared to $1.2 million (1.10% of total loans) at December 31, 1998.

The provision for loan losses charged to operations was based on the amount of net losses
incurred and management's estimation of future losses based on an evaluation of loan portfolio
risk and current economic factors.  The provision for loan losses was $284 thousand in 1999
compared to $180 thousand in 1998.

Total noninterest income decreased $198 thousand to $805 thousand in 1999 from $1.003
million in 1998.  Net gain on sales of securities decreased $348 thousand to $8 thousand in 1999
as compared to $357 thousand in 1998.  Net gains on sales of loans decreased $113 thousand to
$58 thousand in 1999 as compared to $171 thousand in 1998.  Service charges on deposit
accounts increased $85 thousand to $423 thousand in 1999 as compared to $338 thousand in
1998.

Total noninterest expense increased $418 thousand (10.3%) to $4.47 million in 1999 from $4.05
million in 1998.  Salaries and related costs increased $271 thousand (12.9%) to $2.4 million in
1999 from $2.1 million in 1998.  This increase resulted from annual merit increases, a full year
impacts of the 1998 additions to the executive area and technological support staff.  Net
occupancy costs, which includes buildings, equipment and furniture decreased $78 thousand
(14.1%) to $474 thousand in 1999 from $552 thousand in 1998.

Income tax expense for 1999 was $349 thousand, an increase of $48 thousand (15.8%) from
1998.  This increase resulted from an increase in income before income tax expense as well as a
lesser investment in tax-exempt securities.

RESULTS OF OPERATIONS

1998 Compared With 1997

Net interest income for 1998 was $4.85 million, an increase of $.45 million (10.2%) over 1997.
The increase was primarily due to a 15.3% increase in the average balance of total loans.  The
average yield on loans declined to 9.08% compared to 9.11% for 1997.  The average rate on
interest-bearing liabilities declined to 4.86% from 4.91% in 1997.  The combination of these
factors resulted in the net interest margin on earning assets declining only slightly, to 4.19% in
1998 from 4.21% in 1997.

At December 31, 1998, total loans amounted to $108.5 million, an increase of 25.3% over the
December 31, 1997 balance of $86.6 million.  This increase was due to the Company's loan
origination efforts and the increased presence in the Lima market.

The Company elects to sell in the secondary market a portion of the residential mortgage loans
that it originates.  These are primarily fixed rate loans and, typically, the servicing rights are
retained.  During 1998, gains of $171.5 thousand were recognized on such sales, an increase of
90.9% over the 1997 amount of $89.8 thousand.

Securities available for sale totaled $34.4 million at December 31, 1998 which represented an
increase of $7.3 million (26.8%) form total securities of $27.2 million at December 31, 1997.  As
of December 31, 1998, all securities of the Company were designated available for sale.
Available for sale securities represent those securities that the Company may decide to sell if
needed for liquidity, asset/liability management or other reasons.  Such securities are reported at
fair value with net unrealized appreciation/(depreciation) included as a separate component of
shareholders' equity, net of tax.  At December 31, 1998, this resulted in $304.0 thousand as a net
increase in shareholders' equity.

Total deposits at December 31, 1998 were $131.0 million, an increase of $23.1 million (21.5%)
over total deposits of $107.8 million at December 31, 1997.  The increase is a result of cross-selling efforts with existing customers coupled with the increased expansion into the Lima
market.

Other borrowings at December 31, 1998 were $10.6 million compared to $3.3 million at
December 31, 1997.  These borrowings were comprised of $8.4 million of FHLB advances and
$2.2 million of federal funds purchased.  The Company utilizes these alternative sources of
funding to support its asset growth.

The allowance for loan losses at December 31, 1998 was $1.2 million (1.10% of total loans)
compared to $1.1 million (1.28% of total loans) at December 31, 1997.

The provision for loan losses charged to operations was based on the amount of net losses
incurred and management's estimation of future losses based on an evaluation of loan portfolio
risk and current economic factors.  The provision for loan losses was $180 thousand in 1998
compared to $130 thousand in 1997.

Total noninterst income increased $500 thousand to $1.003 million in 1998 from $503 thousand
in 1997.  Net gain on sales of securities increased $335 thousand to $357 thousand in 1998 as
compared to $22 thousand in 1997.  Net gains on sales of loans increased $82 thousand to $171
thousand in 1998 as compared to $89 thousand in 1997.  Service charges on deposit accounts
increased $67 thousand to $338 thousand in 1998 as compared to $271 thousand in 1997.

Total noninterest expenses increased $1.0 million (33.3%) to $4.0 million in 1998 from

$3.0 million in 1997.  Salaries and related costs increased $510 thousand (32.1%) to $2.1 million
in 1998 from $1.6 million in 1997.  This increase resulted from annual merit increases, increased
staffing needs caused by the addition expansion into the Lima market as well as additions to the
executive area and technological support staff.  Net occupancy costs, which includes buildings,
equipment and furniture, increased $161 thousand (41.3%) to $552 thousand in 1998 from $391
thousand in 1997.  This increase

resulted from the additional expansion into the Lima market as well as upgrades to various
computer-related equipment.

Income tax expense for 1998 was $302 thousand, a decrease of $49 thousand (14.1%) from 1997.
This decrease resulted from a decrease in income before income tax expense as well as a greater
investment in tax-exempt securities.

LIQUIDITY

Liquidity relates primarily to the Company's ability to fund loan demand, meet deposit customers'
withdrawal requirements and provide for operating expenses.  Assets used to satisfy these needs
consist of cash and due from banks, federal funds sold, securities available for sale and certain
loans, which are sold from time to time.  A large portion of the liquidity is provided by the ability
to sell securities.  Accordingly, the Company has designated the entire securities portfolio of
$26.0 million at December 31, 1999 as available for sale.

Another source of liquidity is represented by the Company's residential mortgage portfolio.
These loans can and have been readily used to collateralize borrowings.

The cash flow statements for the years presented provide an indication of the Company's sources
and uses of cash as well as an indication of the ability of the Company to maintain an adequate
level of liquidity.  A discussion of the cash flow statements for 1999, 1998 and 1997 follows.

The Company generated cash from operating activities of $1.3 million in 1999, $1.2 million in
1998 and $1.4 million in 1997.

Net Cash flow from investing activities was $(14.0) million in 1999, $(30.8) million in 1998 and
$(15.3) million in 1997.  The primary reason for these cash flows was the net increase in loans,
which was $20.4 million in 1999, $21.8 million in 1998, and $12.0 million in 1997.

Net cash flow from financing activities was $14.4 million in 1999, $30.6 million in 1998, and
$13.0 million in 1997.  The primary source for these cash flows was the net increase in deposits
of $10.3 million in 1999, $23.1 million in 1998, and $13.0 million in 1997.

ASSET LIABILITY MANAGEMENT

Closely related to liquidity management is the management of interest-earning assets and
interest-bearing liabilities.  The Company manages its rate sensitivity position to avoid wide
swings in net interest margins and to minimize risk due to changes in interest rates.

The difference between a financial institution's interest rate sensitive assets (assets that will
mature or reprice within a specific time period) and interest rate sensitive liabilities (liabilities
that will mature or reprice within the same time period) is commonly referred to as its "interest
rate sensitivity gap" or "gap".  An institution having more interest rate sensitive assets than
interest rate sensitive liabilities within a given time interval is said to have a "positive gap",
which generally means that when interest rates increase, an institution's net interest income will
increase and when interest rates decrease, the institution's net interest income will decrease.  An
institution having more interest rate sensitive liabilities than interest rate sensitive assets within a
given time interval is said to have a "negative gap", which generally means that when interest
rates increase, the institution's net interest income will decrease and when interest rates decrease,
the institution's net interest income will increase.

The following table sets forth the cumulative repricing distributions as of December 31, 1999 of
the Company's interest-earning assets and interest-bearing liabilities, its interest rate sensitivity
gap, cumulative interest rate sensitivity gap for such assets and liabilities, and cumulative interest
rate sensitivity gap as a percentage of total interest-earning assets.  This table indicates the time
periods in which certain interest-earning assets and certain interest-bearing liabilities will mature
or may reprice in accordance with their contractual terms.  Core deposits and loans with non-contractual maturities are included in the gap repricing distributions based upon historical
patterns of balance attrition and pricing behavior.  The gap repricing distributions also include
principal cash flows from loans and mortgage backed securities in the time frames in which they
are expected to be received.  Mortgage prepayments are estimated by applying industry median
projections of prepayment speeds to portfolio segments based on coupon range.

Total interest-earning assets exceeded interest-bearing liabilities by $10.3 million at December
31, 1999.  This difference was funded through non-interest bearing liabilities and shareholders'
equity.  The table below is based on contractual maturities and repricing only and includes
assumptions regarding early loan and security repayments.  The table below shows that the total
liabilities maturing or repricing with one year exceed assets maturing or repricing within one year
by $82.6 million.  However, repricing of certain categories of assets and liabilities is subject to
competitive and other influences that are beyond the Company's control.  Therefore, certain
assets and liabilities indicated as maturing or repricing within a stated period may, in fact, mature
or reprice in other periods or at different volumes.

|                                         |                                                | Maturity or Next Rate Adjustment Date        |                                               
|---------------------------------------- | ---------------------------------------------- | -------------------------------------------- | ----------------------------------------------
|December 31, 1999                        | 0 - 3

Months                                  | 3 - 12

Months                               | 1 - 2

Years                                  
|Rate Sensitive Assets                   
|Loans

Securities

Totals                | $21,356

1,324

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

$22,680

======= | $18,417

249

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

$18,666

======= | $16,199

2,198

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

$18,397

=======
|Rate Sensitive Liabilities              
|Int-Bearing Deposits

Borrowings

Totals | $72,527

276

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

$72,803

=======   | $43,1558,000

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

$51,155

======= | $10,714

6,000

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

$16,714

=======
|Gap

Cumulative Gap                      | $(50,123)

(50,123)                            | $(32,489)

(82,612)                          | $1,683

(80,929)                              
|Cumulative Gap/                         
|Rate Sensitive Assets                    | -221.00%                                       | -199.81%                                     | -135.46%                                      

EFFECTS OF INFLATION

The assets and liabilities of the Company are primarily monetary in nature and are more directly
affected by the fluctuation in interest rates than inflation.  Movement in interest rates is a result
of the perceived changes in inflation as well as monetary and fiscal policies.  Interest rates and
inflation do not necessarily move with the same velocity or within the same period; therefore, a
direct relationship to the inflation rate cannot be shown.  The financial information presented in
the Company's financial statements has been prepared in accordance with generally accepted
accounting principles, which require that the Company measure financial position and operating
results primarily in terms of historical dollars.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The primary market risk to which the Company is exposed is interest rate risk.  The primary
business of the Company and the composition of its balance sheet consists of investments in
interest-earning assets, which are funded by interest-bearing liabilities.  These financial
instruments have varying levels of sensitivity to changes in the market rates of interest, resulting
in market risk.  None of the Company's financial instruments are held for trading purposes.

One method the Company uses to manage its interest rate risk is a rate sensitivity gap analysis,
(see the discussion on "Asset -Liability Management.")  The Company also monitors its interest
rate risk through a sensitivity analysis, whereby it measures potential changes in its future
earnings and the fair values of its financial instruments that may result from one or more
hypothetical changes in interests rates.  This analysis is performed by estimating the expected
cash flows of the Company's financial instruments using interest rates in effect at year-end 1998.
For the fair value estimates, the cash flows are then discounted to year-end to arrive at an
estimated present value of the Company's financial instruments.  Hypothetical changes in interest
rates are then applied to the financial instruments, and the cash flows and fair values are again
estimate using these hypothetical rates.  For the net interest income estimates, the hypothetical
rates are applied to the financial instruments based on the assumed cash flows.  The Company
applies these interest rate shocks to its financial instruments up and down 100 basis points.

The following table presents an analysis of the potential sensitivity of the Company's annual net
interest income and present value of the Company's financial instruments to sudden and
sustained 100 basis-point changes in market interest rates:

|                                    |       | Year-end | ALCO      
|----------------------------------- | ----- | -------- | ----------
|                                    |       | 1999     | Guidelines
|One Year Net Interest Income Change |       |         
|+100 Basis points                   | -3.1% | -5.0%   
|-100 Basis points                   | 2.4%  | -5.0%   
|Net Present Value of Equity Change  |       |         
|+100 Basis points                   | 0.0%  |         
|-100 Basis points                   | 0.0%  |         

The projected volatility of net interest income and the net present value of equity rates to a +/-
100 basis points change at December 31, 1999 fall within the Board of Directors' guidelines.

The above analysis is based on numerous assumptions, including relative levels of market
interest rates, loan prepayments and reactions of depositors to changes in interest rates, and
should not be relied upon as being indicative of actual results.  Further, the analysis does not
necessarily contemplate all actions the Company may undertake in response to changes in
interest rates.

FORWARD-LOOKING STATEMENTS

This report includes forward-looking statements by the Company relating to such matters as
anticipated operating results, prospects for new lines of business, technological developments,
economic trends (including interest rates), and similar matters.  The Private Securities Litigation
Reform Act of 1995 provides a safe harbor for forward-looking statements, and the purpose of
this paragraph is to secure the use of the safe harbor provisions.  While the Company believes
that the assumptions underlying the forward looking statements contained herein and in other
public documents are reasonable, any of the assumptions could prove to be inaccurate, and
accordingly, actual results and experience could differ materially from the anticipated results or
other expectations expressed by the Company in its forward-looking statements.  Factors that
could cause actual results or experience to differ from results discussed in the forward-looking
statements include, but are not limited to: economic conditions; volatility and direction of market
interest rates; governmental legislation and regulation; material unforeseen changes in the
financial condition or results of operations of the Company's customers; customer reaction to and
unforeseen complications with respect of the integration of acquisitions; product design
initiative; and other risks identified, from time-to-time in the Company's other public documents
on file with the Securities and Exchange Commission.

ACQUISITION OF THE BANK OF LEIPSIC

During December 1999, shareholders of both the Company and The Bank of Leipsic voted to
approve a merger whereby The Bank of Leipsic would become a wholly-owned subsidiary of the
Company.  Upon receiving requisite regulatory approval, the merger was consummated January
31, 2000.  Under terms of the merger agreement, former shareholders of The Bank of Leipsic
received 54.25 shares of the Company's stock in exchange for each share previously owned, a
total of 1,085,000 shares.  Additional information pertaining to this transaction is reflected in
Note P of the financial statements.

February 25, 2000

INDEPENDENT AUDITORS' REPORT

Stockholders

United Bancshares, Inc.

Columbus Grove, Ohio

We have audited the accompanying consolidated balance sheets of United Bancshares, Inc. as of
December 31, 1999 and 1998, and the related consolidated statements of income, stockholders'
equity and cash flows for the years ended December 31, 1999, 1998 and 1997.  These financial
statements are the responsibility of the company's management.  Our responsibility is to express
an opinion on these 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 consolidated financial statements referred to above present fairly, in all
material respects, the financial position of United Bancshares, Inc. as of December 31, 1999 and
1998, and the results of its operations and its cash flows for 1999, 1998, and 1997 in conformity
with generally accepted accounting principles.

/s/ E S Evans & Company

CONSOLIDATED BALANCE SHEETS

|                                              |   | December 31                  
|--------------------------------------------- | - | -----------------------------
|ASSETS                                        |   | 1999                         
|Cash and Due from Banks                       | $ | 4,066,439                    
|Federal Funds Sold                            |   | 1,075,000                    
|Investment Securities - Note B                |   | 25,990,791                   
|Loans, Net of Allowance for Loan Losses of    |   |                              
|$1,207,015 and $1,198,103, respectively -     |   |                              
|Note C                                        |   | 127,711,510                  
|Other Assets -                                |   |                              
|Premises and Equipment, net - Note D          |   | 3,698,357                    
|Interest Receivable                           |   | 1,168,317                    
|Deferred Income Tax - Note F                  |   | 961,995                      
|Other Real Estate Owned                       |   | 395,269                      
|Other Assets                                  |   | 1,895,785

-------------     
|Total Other Assets                            |   | 8,119,723

-------------     
|Total Assets                                  | $ | 166,963,463

=========       
|                                              |   |                              
|LIABILITIES AND STOCKHOLDERS' EQUITY          |   |                              
|Deposits - Note E                             |   |                              
|Noninterest-Bearing                           | $ | 10,547,736                   
|Interest-Bearing                              |   | 130,730,375 

---------------
|Total Deposits                                |   | 141,278,111 

---------------
|Federal Funds Purchased                       |   | -                            
|Federal Home Loan Bank Borrowing - Note J     |   | 14,646,740                   
|Other Borrowed Funds                          |   | 275,000                      
|Interest Payable                              |   | 244,563                      
|Other Liabilities                             |   | 669,948 

--------------     
|Total Liabilities                             |   | 157,114,362 

-------------- 
|Stockholders' Equity -                        |   |                              
|Common Stock, Stated Value $1;                |   | 1,198,677                    
|3,750,000 shares authorized; 1,198,677        |   |                              
|and 1,176,800 shares issued and outstanding,  |   |                              
|respectively                                  |   |                              
|Capital Surplus                               |   | 1,889,936                    
|Retained Earnings                             |   | 7,950,602                    
|Accumulated Other Comprehensive Income/(Loss) |   | (1,190,114)

--------------  
|Total Stockholders' Equity                    |   | 9,849,101 

--------------   
|Total Liabilities and Stockholders' Equity    | $ | 166,963,463 

=========      

The accompanying notes are integral part of these financial statements.

CONSOLIDATED STATEMENTS OF INCOME

For the Three years Ended December 31, 1999, 1998 and 1997

|                                                      |                          | Year ended December 31,    
|----------------------------------------------------- | ------------------------ | ---------------------------
|                                                      |                          | 1999                       
|Interest Income                                       |                          |                            
|Interest and Fees from Loans                          | $                        | 10,225,434                 
|Interest from Investments -                           |                          |                            
|Taxable                                               |                          | 882,103                    
|Tax-exempt                                            |                          | 708,926                    
|Other                                                 |                          | 42,066 

--------------    
|Total Interest Income                                 |                          | 11,858,529 

--------------
|Interest Expense -                                    |                          |                            
|Deposits -                                            |                          |                            
|Demand, Savings, and Money Market Accounts            | 836,689                  |                            
|Time Deposits                                         |                          | 5,007,690                  
|Borrowings                                            |                          | 369,862 

--------------   
|Total Interest Expense                                |                          | 6,214,241 

-------------- 
|                                                      |                          |                            
|Net Interest Income                                   |                          | 5,644,288                  
|Provision for Loan Losses                             |                          | 283,850 

--------------   
|Net Interest Income, After Provisions for Loan
Losses |                          | 5,360,438                  
|                                                      |                          |                            
|Noninterest Income -                                  |                          |                            
|Service Charges on Deposit Accounts                   |                          | 422,994                    
|Securities Gains/(Losses)                             |                          | 8,335                      
|Gains from Sales of Loans                             |                          | 58,277                     
|Other                                                 |                          | 315,629

--------------    
|Total Noninterest Income                              |                          | 805,235 

--------------   
|                                                      |                          |                            
|Noninterest Expense -                                 |                          |                            
|Salary and Related Costs                              |                          | 2,370,065                  
|Net Occupancy Costs                                   |                          | 473,892                    
|Data Processing Costs                                 |                          | 302,455                    
|Stationery and Supplies Costs                         |                          | 123,718                    
|Advertising Costs                                     |                          | 107,015                    
|Franchise Tax Costs                                   |                          | 131,460                    
|Other Costs                                           |                          | 959,016 

--------------   
|Total Noninterest Expense                             |                          | 4,467,621 

-------------- 
|                                                      |                          |                            
|Income Before Income Taxes                            |                          | 1,698,052                  
|Provision for Income Taxes                            |                          | 349,444                    
|                                                      |                          | --------------             
|Income After Income Taxes                             |                          | 1,348,608                  
|(Loss), After Applicable Income Taxes, of             |                          |                            
|Operating Loss of Unconsolidated Subsidiary           | (12,373)

-------------- |                            
|                                                      |                          |                            
|Net Income                                            | $                        | 1,336,235

========        
|Net Income Per Common Share -                         |                          |                            
|Basic                                                 | $                        | 1.12 

========            
|Diluted                                               | $                        | 1.01

========             

The accompanying notes are integral part of these financial statements.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

For the Three Years Ended December 31, 1999, 1998 and 1997

|                            |                      |         |                      |           | Capital in            |                        |                 | Accumulated  |                 |                   
|--------------------------- | -------------------- | ------- | -------------------- | --------- | --------------------- | ---------------------- | --------------- | ------------ | --------------- | ------------------
|                            |                      |         |                      |           | Excess of             |                        |                 | Other        |                 |                   
|                            |                      |         | Common               | Stated    | Retained              | Comprensive            | Treasury        | Stockholders
|                            |                      |         | Stock                | Value     | Earnings              | Income                 | Stock           | Equity      
|BALANCES JANUARY 1, 1997    | $                    | 258,446 | $                    | 1,555,657 | $                     | 4,984,710              | $               | (39,604)     | $               | -                 
|                            |                      |         |                      |           |                       |                        |                 |              |                 |                   
|COMPREHENSIVE INCOME        |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Net Income                  |                      |         | -                    |           | -                     |                        | 1,380,476       |              | -               |                   
|                            |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Net Change in Unrealized    |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Gains on Securities         |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Available for Sale,         |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Net of Taxes of             |                      |         |                      |           |                       |                        |                 |              |                 |                   
|$62,601 - Note B            |                      |         | -                    |           | -                     |                        | -               |              | 121,520         |                   
|TOTAL COMPREHENSIVE         |                      |         |                      |           |                       |                        |                 |              |                 |                   
|INCOME                      |                      |         |                      |           |                       |                        |                 |              |                 |                   
|                            |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Stock Dividends             |                      |         | 6,612                |           | 222,577               |                        | (229,189)       |              | -               |                   
|Purchase of Treasury Stock  | -                    |         | -                    |           | -                     |                        | -               |              | (212,284)       |                   
|Exercise of Stock Options - |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Note L                      |                      |         | 16,786 

----------- |           | 414,085 

----------- |                        | - 

----------- |              | - 

----------- |                   
|                            |                      |         |                      |           |                       |                        |                 |              |                 |                   
|BALANCES, DECEMBER 31, 1997 | 281,844              |         | 2,192,319            |           | 6,135,997             |                        | 81,916          |              | (212,284)       |                   
|                            |                      |         |                      |           |                       |                        |                 |              |                 |                   
|COMPREHENSIVE INCOME        |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Net Income                  |                      |         |                      |           |                       |                        | 1,319,567       |              |                 |                   
|                            |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Net Change in Unrealized    |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Gains on Securities         |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Available for Sale,         |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Net of Taxes of             |                      |         |                      |           |                       |                        |                 |              |                 |                   
|$114,392 - Note B           |                      |         | -                    |           | -                     |                        | -               |              | 222,056         |                   
|TOTAL COMPREHENSIVE         |                      |         |                      |           |                       |                        |                 |              |                 |                   
|INCOME                      |                      |         |                      |           |                       |                        |                 |              |                 |                   
|                            |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Stock Split                 |                      |         | 861,421              |           | (861,421)             |                        |                 |              |                 |                   
|Stock Dividends             |                      |         | 22,909               |           | 307,734               |                        | (330,645)       |              |                 |                   
|Sale of Treasury Stock      |                      |         |                      |           |                       |                        |                 |              |                 | 212,284           
|Redeem Fractional Shares    |                      |         | (7,707)              |           |                       |                        |                 |              |                 |                   
|Exercise of Stock Options - |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Note L                      |                      |         | 10,626 

----------- |           | 95,577 

-----------  |                        | - 

----------- |              | - 

----------- |                   
|                            |                      |         |                      |           |                       |                        |                 |              |                 |                   
|BALANCES, DECEMBER 31, 1998 | 1,176,800            |         | 1,726,502            |           | 7,124,919             |                        | 303,972         |              | -               | 10,332,193        
|                            |                      |         |                      |           |                       |                        |                 |              |                 |                   
|COMPREHENSIVE INCOME        |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Net Income                  |                      |         |                      |           |                       |                        | 1,336,235       |              |                 |                   
|                            |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Net Change in Unrealized    |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Gains on Securities         |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Available for Sale,         |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Net of Taxes of             |                      |         |                      |           |                       |                        |                 |              |                 |                   
|($769,681) - Note B         |                      | -       |                      | -         |                       | -                      |                 | (1,494,086)  | -               | (1,494,086)       
|TOTAL COMPREHENSIVE         |                      |         |                      |           |                       |                        |                 |              |                 |                   
|LOSS                        |                      |         |                      |           |                       |                        |                 |              |                 |                   
|                            |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Stock Dividends             |                      |         | 7,213                |           | 109,998               |                        | (117,211)       |              |                 |                   
|Redeem Fractional Shares    |                      |         | (3,354)              |           |                       |                        |                 |              |                 |                   
|Cash Dividends Paid         |                      |         |                      |           |                       |                        | (393,341)       |              |                 |                   
|Exercise of Stock Options - |                      |         |                      |           |                       |                        |                 |              |                 |                   
|Note L                      |                      |         | 14,664
-----------   |           | 56,790

-----------   |                        | -
-----------   |              | -

-----------  |                   
|BALANCES, DECEMBER 31, 1999 | $1,198,677

======== | $       | 1,889,936 

======== | $         | 7,950,602 

=======   | $(1,190,114)

======== | $               | - 

======== | $               | 9,849,101

=======

The accompanying notes are integral part of these financial statements.

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Three Years Ended December 31, 1999, 1998 and 1997

|                                               |                              | Year ended December 31,  
|---------------------------------------------- | ---------------------------- | -------------------------
|                                               |                              | 1999                     
|Cash Flows from Operating Activities:          |                              |                          
|Net Income                                     | $                            | 1,336,235                
|Adjustments -                                  |                              |                          
|Depreciation and Amortization                  |                              | 267,872                  
|Provision for Loan Losses                      |                              | 283,850                  
|Decrease/(Increase) in Other Assets            |                              | 16,103                   
|Decrease/(Increase) in Deferred Income Tax     | (753,011)                    |                          
|Increase/(Decrease) in Other Liabilities       |                              | 104,074 

-------------  
|Net Cash Provided by Operating Activities      | 1,255,123

-------------     |                          
|                                               |                              |                          
|Cash Flows from Investing Activities:          |                              |                          
|Purchase of Securities to be held to Maturity  | -                            |                          
|Proceeds from Maturities of Securities         |                              |                          
|to be Held to Maturity                         |                              | -                        
|Purchase of Available for Sale Securities      |                              | (9,565,629)              
|Proceeds from Sales and Maturities of          |                              |                          
|Available for Sale Securities                  |                              | 16,591,180               
|Net (Increase) in Loans                        |                              | (20,423,283)             
|Recovery of Loans Written Off as Uncollectible | 96,901                       |                          
|Loans Charged Off                              |                              | (371,839)                
|Fixed Assets Acquired                          |                              | (317,147)                
|(Increase)/Decrease in Other Real Estate Owned | 2,959

-------------         |                          
|Net Cash Used in Investing Activities          | (13,986,858)

-------------- |                          
|                                               |                              |                          
|Cash Flows from Financing Activities           |                              |                          
|Net (Payments)/Proceeds from Borrowing         |                              | 4,367,945                
|Net Increase in Deposit Accounts               |                              | 10,315,247               
|Sale/(Purchase) of Treasury Stock              |                              | -                        
|Cash Dividends Paid                            |                              | (393,341)                
|Redemption of Fractional Shares                |                              | (3,354)                  
|Exercise of Stock Options                      |                              | 71,454 

-------------   
|Net Cash Provided by Financing Activities      | 14,357,951

-------------    |                          
|                                               |                              |                          
|Net Change in Cash and Cash Equivalents        |                              | 1,626,216                
|                                               |                              |                          
|Cash and Cash Equivalents at January 1         |                              | 3,515,223 

-------------
|                                               |                              |                          
|Cash and Cash Equivalents at End of Period     | $                            | 5,141,439 

=========    
|                                               |                              |                          
|Cash Paid During the Year for:                 |                              |                          
|Interest                                       | $                            | 6,212,637                
|                                               |                              |                          
|Income Taxes                                   | $                            | 350,500                  

The accompanying notes are integral part of these financial statements.

UNITED BANCSHARES, INC.

COLUMBUS, OHIO

NOTES TO CONSOLIDATE FINANCIAL STATEMENTS

For the Years Ended December 31, 1999 and 1998

Note A - Summary of Significant Accounting Policies

Nature of Operations

The Company's subsidiary, The Union Bank Company, operates under a State Bank Charter and
provides full banking services.  As a State Bank, the Bank is subject to regulation of The State of
Ohio, The Federal Reserve and the Federal Deposit Insurance Corporation.  The area served by The
Union Bank Company is West Central Ohio.  Services are provided through offices in Columbus
Grove, Kalida, Ottawa, and Lima.

Consolidation

The consolidated financial statements include the accounts of United Bancshares, Inc.

("Company"), and its wholly-owned subsidiary, The Union Bank Company ("Bank"), after
elimination of intercompany transactions and balances.  The supplementary statements labeled
Parent Only reflect United Bancshares, Inc.'s investment in Union Bank under the equity method of
accounting.

Investment Securities

The Bank's investment securities are generally classified as Available for Sale.  Securities available
for sale are those securities not classified as trading securities nor as securities to be held to maturity.
Unrealized holding gains and losses, net of tax, on securities available for sale are reported as a net
amount in a separate component of shareholders' equity until realized.  Gains or losses on disposition
are based on the net proceeds and the adjusted carrying amount of the securities sold, using the
specific identification method.

Loans and Allowance for Loan Losses

Loans are reported at the amount of unpaid principal, reduced by unearned discount and an
allowance for possible loan losses.  Interest on loans is calculated by using the simple interest
method on daily balances of the principal amount outstanding.

The allowance for loan losses is established through a provision for loan losses charged to expense.
Loans are charged against the allowance for loan losses when management believes that the
collectibility of principal is unlikely.  The allowance is an amount that management believes will be
adequate to absorb possible losses on existing loans that may become uncollectible, based on
evaluation of the collectibility of loans and prior loan loss experience.  The evaluations take into
consideration such factors as changes in the nature and volume of the loan portfolio, overall portfolio
quality, review of specific problem loans and current economic conditions that may affect the
borrower's ability to pay.

Accrual of interest is discontinued on a loan when management believes, after considering economic
and business conditions and collection efforts, that the borrower's financial condition is such that
collection of interest is doubtful.

From time to time, The Bank elects to sell a portion of its residential mortgage loans.  At the time
of sale, gain or loss is determined by comparing the proceeds with the book value.  Such gain or loss
is reflected as a component of noninterest income.

The impairment of a loan is measured based upon the present value of anticipated future cash flows,
discounted at the loan's effective interest rate, or on the underlying future cash flows, discounted at
the loan's effective interest rate, or on the underlying value of collateral for collateral dependent
loans.  The impaired loan's value in excess of the expected cash flows or collateral value, is
specifically charged to the allowance for loan losses.

Mortgage Servicing Rights

SFAS No. 122, "Accounting for Mortgage Servicing Rights" requires an entity that sells mortgage
loans with servicing rights retained to allocate the total cost of the mortgage loan to the mortgage
servicing rights and the loans based on their relative fair values.  Under SFAS No. 122, if it is not
practicable to estimate the fair values of the mortgage servicing rights and the mortgage loans
without the servicing rights, the entire cost of originating the mortgage loan shall be allocated to the
mortgage loan and no cost shall be allocated to the servicing rights.  Due to the lack of a
comprehensive valuation methodology, Management has determined it is not practicable to estimate
the fair values of the mortgage servicing rights.



Other Real Estate

Other real estate, acquired through partial or total satisfaction of loans, is carried at the lower of cost
or fair market value.  At the date of acquisition, any losses are charged to the allowance for loan
losses.

Bank Premises and Equipment

Building and equipment are stated at cost, less accumulated depreciation, computed on the straight
line and declining balance methods over the estimated useful lives.  Expenditures, for betterment's
and renewals, which extend useful lives, are added to the basis of the assets.  Gains and losses on
retirements and disposals are included in net income.

Income Taxes

Deferred income taxes are reported for timing differences between items of income or expense
reported in the financial statements and those reported for income tax purposes. The differences
relate principally to the provision for loan losses and certain compensation plans, and unrealized
holding gains and losses on securities available for sale.

Estimates

The preparation of financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the date of financial statements
and the reported amounts of revenues and expenses during the reporting period.  Actual results could
differ from these estimates.

Cash and Cash Equivalents

For the statements of cash flows, cash and cash equivalents includes cash on hand, correspondent
bank accounts, and federal funds sold.

Treasury Stock

Treasury shares acquired are reported at cost.

Stock Based Compensation

The Company applies APB Opinion No. 25, "Accounting for Stock Issued to Employees" (APB No.
25) and related interpretations in accounting for its stock-based compensation plans.  In 1995, the
FASB issued Statements of Financial Accounting Standards ("SFAS") No. 123, "Accounting for
Stock-Based Compensation" which is effective for fiscal years beginning after December 15, 1995.
Under SFAS No. 123, companies may elect to recognize stock-based compensation expense based
on the fair value of the awards or continue to account for stock-based compensation under APB No.
25.  The Company has elected to continue to apply the provision of APB No. 25.

Stock Dividends and Splits

All per share and average share information have been restated in accordance with SFAS No. 128.
Dividends issued in stock are reported by transferring the market value of the stock issued from
retained earnings to common stock and additional paid-in capital.  Stock splits are recorded by
adjusting common stock and additional paid-in capital by the par value of the additional shares.  On
May 20, 1998, the Board of Directors declared a four-for-one stock split, paid on June 1, 1998,
increasing shares outstanding by 861,421 shares.

Investment in Unconsolidated Subsidiary

The Company, along with six other financial organizations, has an investment in Northwest
Financial Services, LLC.  Each of the organizations, including The Company, has a 1/7 ownership
position in Northwest.  Northwest provides item processing of deposit documents for the owner
organizations and began operations in 1999.  The Company accounts for its investment in Northwest
on the equity method.  This means that The Company's share of income or loss is reflected as a
separate amount on the Statement of Income.  The carrying amount of the investment is adjusted for
this amount also.

Note B - Investment Securities

Carrying amounts and approximate market values of investments securities are summarized as
follows:

|                                |               | December 31, 1999          
|------------------------------- | ------------- | ---------------------------
|                                |               | Amortized                  
|                                |               | Cost                       
|Securities Available for Sale - |               |                            
|U. S. Treasury & Agency         | $   2,213,302 |                            
|State and Municipal             | 16,160,489    |                            
|Mortgaged Backed                | 8,085,441     |                            
|Other                           |               | 1,334,762

--------------- 
|                                | Total         | $  27,793,994

==========  
|                                |               |                            
|                                |               | December 31, 1998          
|                                |               | Amortized                  
|                                |               | Cost                       
|Securities Available for Sale - |               |                            
|U. S. Treasury & Agency         | $   3,051,186 |                            
|State and Municipal             | 19,581,835    |                            
|Mortgaged Backed                | 10,049,986    |                            
|Other                           |               | 1,366,859

----------------
|                                | Total         | $  34,049,866

==========  

Government and agency securities have been pledged to secure public funds on deposit in the
amounts of $2,207,000 and $3,462,000 for 1999 and 1998, respectively.  Included in the Securities
Available for Sale - Other Securities category is Federal Home Loan Bank stock in the amount of
$732,500 for 1999 and $565,200 for 1998.  Although classified as available for sale, the ownership
of these stocks is restricted and they lack a ready market.  Accordingly, both amortized cost and fair
value are considered to be the original cost.

The scheduled maturities of securities to be held to maturity and securities available for sale at
December 31, 1999 were as follows:

|                           |   | Securities Available

for Sale
|-------------------------- | - | ------------------------------
|                           |  
|                           |   | Amortized                     
|                           |   | Cost                          
|Due in one year or less    | $ | -                             
|Due from 1 to 5 years      |   | 2,026,895                     
|Due from 6 to 10 years     |   | 1,020,064                     
|Due more than 10 years     |   | 15,326,833                    
|Mortgage Backed Securities |   | 8,085,441                     
|Other - No Stated Maturity |   | 1,334,761

-------------      
|                           | $ | 27,793,994 

=========        

Standards issued by the Financial Accounting Standards Board call for investments classified as held
to maturity to be recorded at cost while those classified as available for sale are to be reflected at
market value, with corresponding unrealized gains or losses, net of tax effect, reported as a separate
component of shareholders' equity until realized.  As permitted by the Financial Accounting
Standards Board, transfers were made from held to maturity to available for sale during 1998.  At
the transfer date, securities with a book value of $10,401,137 were transferred from held to maturity
to available for sale.  The market value of these securities was $10,711,000 with a resulting
unrealized gain, net of tax, of $204,510

For all securities classified as available for sale, a net unrealized (loss) of ($1,803,204) existed at
December 31, 1999.  At December 31, 1998, the net unrealized gain was $460,563.

Note C - Loans

Major classifications of loans are as follows:

|                          |   | December 31,              
|------------------------- | - | --------------------------
|                          |   | 1999                      
|Residential Real Estate   | $ | 50,132,861                
|Commercial                |   | 41,993,358                
|Agri/Business             |   | 21,871,499                
|Consumer                  |   | 14,206,168                
|Credit Cards              |   | 714,639

-------------    
|Total Loans               |   | 128,918,525               
|Allowance for Loan Losses |   | (1,207,015)

-------------
|Loans - Net               | $ | 127,711,510 

=========   

Non-performing loans are those on which the accrual of interest has been discontinued.  These loans
totaled $348,000 at December 31, 1999 and $539,000 at December 31, 1998.  Interest income on
those loans is recorded only when received.

Impaired loans were $39,599 and $485,569 at December 31, 1999 and 1998, respectively.  No
specific allocation of the allowance for loan losses has been made for these loans.

Activity within the allowance for the loan losses was:

|                            |           | December 31,         
|--------------------------- | --------- | ---------------------
|                            |           | 1999                 
|Balance, Beginning of Year  | $         | 1,198,103            
|Provision for Loan Losses   |           | 283,850              
|Charge-Offs and Recoveries- |           |                      
|Total Charge-Offs           |           | (371,839)            
|Recoveries                  |           | 96,901               
|Net Charge-Offs             | (274,938) | (89,419)             
|Balance, End of Year        | $         | 1,207,015

==========

Note D - Premises and Equipment

|                                |   | December 31,              
|------------------------------- | - | --------------------------
|                                |   | 1999                      
|Land                            | $ | 987,794                   
|Buildings                       |   | 3,170,828                 
|Furniture and Fixtures          |   | 1,791,557

-------------  
|Total                           |   | 5,950,179                 
|Less:  Accumulated Depreciation |   | (2,251,822)

-------------
|Book Value                      | $ | 3,698,357 

========      

Depreciation and amortization expense amounted to $267,872 and $216,482 for 1999 and 1998,
respectively.

Note E - Deposits

The following is an expected maturity distribution savings and time deposits at

December 31:

|                                |   | 1999                     |   | 1998                     
|------------------------------- | - | ------------------------ | - | -------------------------
|Due in one year or less         | $ | 120,116,722              | $ | 98,782,758               
|Due between one and three years |   | 9,625,004                |   | 21,387,049               
|Due over three years            |   | 988,649                  |   | 425,039                  
|Totals                          | $ | 130,730,375

=========== | $ | 120,594,846 

===========
|                                |   |                          |   |                          

As of December 31, 1999 and 1998, there were $10,415,459 and $8,046,176 of time deposits greater
than $100,000.  At December 31, 1999 and 1998, there were $126,771 and $134,465 of overdraft
deposit relationships classified as loans.

The total amount of public funds held on deposit as of December 31, 1999 and 1998, was $3,753,339
and $3,309,842.  In connection with these deposits, $4,046,000 and $3,462,000 of investments
securities were pledged as collateral.

Note F - Income Taxes

Accumulated deferred income taxes of $961,995, $208,984 and $267,824 for 1999, 1998 and 1997,
respectively, represent the tax effect of the cumulative excess of provision for loan losses over the
deduction for federal income tax purposes, the tax effect of the net change in unrealized appreciation
on securities available for sale, and the timing difference on certain compensation-related expenses.

The total income taxes reflected in the statement of income are:



|                  | December 31,
|----------------- | ------------
|                  |             
|Currently Payable | $           
|Deferred          |             
|Net               | $           

The principal reasons for the difference in the effective tax rate and the federal statutory rate are as
follows;

|                                  | December 31, | 
|--------------------------------- | ------------ | 
|                                  | 1999         | 
|Statutory Federal Income Tax Rate | 34%          | 
|Effect on Rate of -               |              | 
|Tax Exempt Securities Income      | (14)         | 
|Loan Losses                       | 0            | 
|Stock Options Exercised           | (2)          | 
|Credits                           | 0            | 
|Other, Net                        | 3            | 
|Tax Rate Based on Reported Income | 21%

=====   | 
|                                  |              | 

Note G - Commitments and Contingencies

In the normal course of business, there are various commitments and contingent liabilities (such as
guarantees, commitments to extend credit, letters of credit and lines of credit) which are properly not
recorded in the financial statements.  At December 31, 1999, the Bank had commitments to
customers for $134,000 of commercial letters of credit and $19,853,000 of loan commitments.  In
the opinion of management, these do not represent unusual risk.

The Bank is also subject to claims and lawsuits which arise primarily in the ordinary course of
business.  Based on information presently available and advice received from legal counsel
representing the Bank in connection with such claims and lawsuits, it is the opinion of management
that the disposition or ultimate determination of such claims and lawsuits will not have a material
adverse effect on the consolidated financial position of the Bank.

Note H - Loans to Related Parties

Loans to related parties include loans made to directors, executive officers and their associates, as
defined.

The aggregate dollar amount of these loans was $1,157,000 and $1,105,000 at December 31, 1999
and 1998, respectively.

Note I - Employee Benefit Plans

The Company has a profit sharing/401(k) plan.  Under the terms of the plan, each active participant
may make a voluntary contribution of up to 12% of pay.  The Bank provides a discretionary
matching contribution, which for 1999, 1998, and 1997 was 50% of an employee's contribution.
This matching contribution is limited to a maximum of a 6% employee contribution.  For 1999, 1998
and 1997, Bank matching contributions were $45,109, $38,394 and $28,980, respectively.

The Bank also makes discretionary contributions to the profit sharing plan.  For 1999, 1998 and
1997, 6%, 6% and 6% of eligible compensation was contributed, $99,515, $94,625 and $74,189,
respectively.

The Bank has a nonqualified deferred compensation plan covering certain key employees.  Such plan
is indirectly funded by purchasing Bank owned life insurance products.  Included in other assets on
the consolidated balance sheets were $1,426,495 and $1,333,904 which represent the balances in the
insurance deposit accounts at December 31, 1999 and 1998, respectively.

Note J - Federal Home Loan Bank Borrowing

Borrowing from the Federal Home Loan Bank consisted of the following amounts:

|                  |  |      |  | December 31,             | 
|----------------- |  | ---- |  | ------------------------ | 
|Maturity Date     |  | Rate |  | 1999                     | 
|April 1, 2009     |  | 6.10 |  | $      204,166           | 
|November 1, 2004  |  | 7.95 |  | 5,524                    | 
|November 1, 2014  |  | 8.60 |  | 12,300                   | 
|December 1, 2009  |  | 8.50 |  | 16,668                   | 
|December 1, 2014  |  | 8.75 |  | 21,970                   | 
|December 1, 2014  |  | 8.40 |  | 32,804                   | 
|December 1, 2014  |  | 8.70 |  | 42,467                   | 
|December 1, 2014  |  | 8.65 |  | 10,063                   | 
|December 1, 2014  |  | 8.65 |  | 41,565                   | 
|January 1, 2015   |  | 8.70 |  | 18,438                   | 
|January 1, 2015   |  | 8.80 |  | 19,986                   | 
|February 1, 2015  |  | 8.70 |  | 14,086                   | 
|March 1, 2015     |  | 8.65 |  | 12,574                   | 
|March 1, 2015     |  | 8.55 |  | 26,142                   | 
|March 1, 2015     |  | 8.40 |  | 15,068                   | 
|April 1, 2015     |  | 8.10 |  | 10,910                   | 
|April 1, 2015     |  | 7.95 |  | 46,133                   | 
|June 1, 2015      |  | 7.95 |  | 67,877                   | 
|November 1, 2015  |  | 6.80 |  | 27,999                   | 
|February 16, 1999 |  | 5.02 |  | -                        | 
|February 17, 1999 |  | 5.02 |  | -                        | 
|February 22, 1999 |  | 5.02 |  | -                        | 
|March 17, 1999    |  | 5.02 |  | -                        | 
|August 31, 2000   |  | 6.11 |  | 8,000,000                | 
|September 2, 2009 |  | 5.52 |  | 6,000,000                | 
|Totals            |  |      |  | $ 14,646,740

========== | 
|                  |  |      |  |                          | 

These advances are secured by certain residential mortgage loans with book values of $37,005,803
and $12,538,238 at December 31, 1999 and 1998, respectively.  At December 31, 1999, the Bank
had a line of credit from The Federal Home Loan Bank in the amount of $18,000,000.  The Bank has
the option of selecting from both variable and fixed rate borrowing products.  All borrowings are
secured by Federal Home Loan Bank stock and mortgages owned by the Bank totaling 150% of the
outstanding borrowings.  At December 31, 1999, the Bank had borrowed $14,000,000 on this line,
as reflected by the 2000 and 2009 maturities reflected above.

Note K - Concentrations of Credit

Substantially all of the Bank's loans, commitments, and commercial and standby letters of credit
have been granted to customers in the Bank's market area.  Investments in state and municipal
securities also involve governmental entities within the Bank's market area.  The concentrations of
credit by type of loan are set forth in Note C.  The distribution of commitments to extend credit
approximates the distribution of loans outstanding.  Commercial and standby letters of credit were
granted primarily to commercial borrowers.

Note L - Stock Dividends

In recent years, the Company's dividends are in the form of stock, with a cash redemption option
available to shareholders.  During 1999, 1998, and 1997, there were 7,213, 28,090 and 26,448 shares
issued as dividends, respectively.  For the last three quarters of 1999, cash dividends totaling
$393,341 were paid.  The merger agreement with The Bank of Leipsic reflects the intent to distribute
cash dividends approximating 30% of net income in the future, subject to approval by The Board of
Directors.

Note M - Stock Options

The Company maintains both qualified and nonqualified stock option plans, under which directors
and Bank officers are entitled to purchase common shares.  The plans generally provide that the
exercise price of any stock option may not be less than the fair market value of the common stock
on the date of the grant.  As permitted by SFAS No. 123, "Accounting for Stock-Based
Compensation", the Company has elected to follow Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" (APB 25).  Under APB 25, because the exercise price
of the Company's stock options equals the market price of the underlying stock on the date of grant,
no compensation expense is recognized for financial statement purposes.  Any subsequent tax benefit
from the exercise is recorded on the Company's books as an addition to capital surplus.

All options granted since plan inception have been adjusted for the effects of common stock
dividends as well as the 1998 stock split.  Because the effects of applying the fair value method of
accounting for stock options under SFAS No. 123 are not materially different from amounts reported
in the consolidated financial statements, fair value and proforma information has not been provided.

The following summarizes the Company's stock options as of December 31, 1999, 1998 and 1997,
and the changes for the years then ended:

|                                       |  |  | 1999               
|-------------------------------------- |  |  | -------------------
|                                       |  |  | Number of          
|                                       |  |  | Shares             
|Outstanding at the beginning of year   |  |  | 139,636            
|Granted                                |  |  | -                  
|Adjustments for stock splits/dividends |  |  | 840                
|Exercised                              |  |  | (14,663)           
|Forfeited                              |  |  | -                  
|Expired                                |  |  | -                  
|Outstanding at the end of the year     |  |  | 125,813

==========
|Exercisable at the end of the year     |  |  | 125,813

==========

|                                       |      | 1998
|-------------------------------------- | ---- | ----
|                                       |      |     
|                                       |      |     
|Outstanding at the beginning of year   |      |     
|Granted                                |      |     
|Adjustments for stock splits/dividends |      |     
|Exercised                              |      |     
|Forfeited                              |      |     
|Expired                                |      |     
|Outstanding at the end of the year     |      |     
|Exercisable at the end of the year     |      |     
|                                       |      |     
|                                       | 1997
|                                       |      |     
|                                       |      |     
|Outstanding at the beginning of year   |      |     
|Granted                                |      |     
|Adjustments for stock splits/dividends |      |     
|Exercised                              |      |     
|Forfeited                              |      |     
|Expired                                |      |     
|Outstanding at the end of the year     |      |     
|Exercisable at the end of the year     |      |     

Note N - Fair Value of Financial Instruments

SFAS No. 107 requires the Company to disclose the estimated fair value of certain financial
instruments such as securities, loans, deposits and others.  For many of the Company's financial
instruments, an available trading market does not exist.  Therefore, significant estimates and present
value calculations were used to determine fair values as described below.  Changes in estimates and
assumptions could have a significant impact on these fair values.

Cash and Cash Equivalents- For cash and due from banks and federal funds sold, the carrying value
is a reasonable estimate of fair value.

Investment Securities - Fair values of investment securities are based on quoted market prices, where
available.  If quoted market prices are not available, fair values are based on quoted market prices
of comparable instruments.

Loans - The fair value of loans are estimated by discounting the future cash flows using current rates
being offered for loans of similar terms to borrowers of similar credit quality.

Deposit Liabilities - The fair values of non-interest bearing deposits, saving, NOW and money
market deposit accounts are, by definition, equal to the amount payable on demand at the reporting
date.  The carrying value of variable rate, fixed-term time deposits and certificates of deposit
approximate their fair values.  For fixed-rate certificates of deposit, fair values are estimated using
a discounted cash flow analysis based on rates currently offered for deposits of similar remaining
maturities.

The following table summarizes the estimated fair values of the Company's financial instruments
at December 31, 1999 and 1998:

|                         | 1999          |  | 1998        
|------------------------ | ------------- |  | ------------
|                         | Carrying      |  | Fair        
|                         | Amount        |  | Value       
|Financial Assets -       |               |  |             
|Cash and Cash Equivalent | $   5,141,439 |  | $  5,141,439
|Investment Securities    | 25,990,791    |  | 25,990,791  
|Net Loans                | 127,711,510   |  | 127,753,000 
|                         |               |  |             
|Financial Liabilities -  |               |  |             
|Deposits                 | 141,278,111   |  | 141,060,000 
|Short Term Borrowing     | -             |  | -           
|Long Term Borrowing      | 14,646,740    |  | 14,646,740  

Note O - Regulatory Matters

The Bank is subject to various regulatory capital requirements administered by the federal banking
agencies.  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 Bank's financial statement.  Under capital adequacy guidelines and the
regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines
that involve quantitative measures of the Bank's assets, liabilities, and certain off-balance-sheet items
as calculated under regulatory accounting practices.  The Bank's capital amount and classification
are also subject to qualitative judgements by the regulators about components, risk weightings, and
other factors.

Qualitative measures established by regulation to ensure capital adequacy require the Bank to
maintain minimum amounts and ratios of total and Tier I capital (as defined in the regulations) to
risk - weighted assets (as defined), and of Tier I capital (as defined) to average assets (as defined).
Management believes, as of December 31, 1999, that the Bank meets all capital adequacy
requirements to which it is subject, after certain events transpired.

As of December 31, 1999, the most recent measurement of total risk-based capital resulted in the
Bank being adequately capitalized, but less than well capitalized.  Management's plan to resolve this
situation is part of an overall capital management program that will be instituted upon the merger
of The Bank of Leipsic into The Company.  The plan is for The Union Bank, as well as The Bank
of Leipsic, to be categorized as well capitalized as defined under the regulatory framework.  To be
so categorized, the individual banks must maintain certain minimum total risk-based, Tier 1 risk-based, and Tier 1 leverage ratios.

The Bank's actual and required amounts and ratios are as follows (dollars in thousands):

|                          |          |  |                  |  | To Be Categorized
|------------------------- | -------- |  | ---------------- |  | -----------------
|                          | Actual   |  | Well Capitalized
|                          | Capital  |  | Capital          |  | Capital          
|                          | Amount   |  | Ratio            |  | Amount           
|As of December 31, 1999   |          |  |                  |  |                  
|Total Risk-Based Capital  |          |  |                  |  |                  
|(to Risk-Weighted Assets) | $ 11,859 |  | 9.1%             |  | $ 13,032         
|Tier I Risk-Based Capital |          |  |                  |  |                  
|(to Risk-Weighted Assets) | 10,652   |  | 8.2%             |  | 7,813            
|Tier I Leverage           |          |  |                  |  |                  
|(to Average Total Assets) | 10,652   |  | 6.4%             |  | 8,274            
|                          |          |  |                  |  |                  
|As of December 31, 1998   |          |  |                  |  |                  
|Total Risk-Based Capital  |          |  |                  |  |                  
|(to Risk-Weighted Assets) | $ 10,676 |  | 9.6%             |  | $ 11,069         
|Tier I Risk-Based Capital |          |  |                  |  |                  
|(to Risk-Weighted Assets) | 9,478    |  | 8.6%             |  | 6,642            
|Tier I Leverage           |          |  |                  |  |                  
|(to Average Total Assets) | 9,478    |  | 6.7%             |  | 7,110            

Note P - Subsequent Event - Merger with The Bank of Leipsic

During December 1999, shareholders of both The Company and The Bank of Leipsic voted to
approve a merger whereby The Bank of Leipsic would become a wholly-owned subsidiary of The
Company.  All required regulatory approvals have been obtained and the merger became effective
February 1, 2000.  Former shareholders of The Bank of Leipsic received 54.25 shares of The
Company's stock in exchange for each share owned of The Bank of Leipsic.

Since the merger took place in 2000, none of the financial information from the Bank of Leipsic is
reflected in these financial statements.  The following table reflects certain positions and results if
the merger had taken place prior to 1999:

|                                            |                                   |  |        |                       |        | If Merger            |  | 
|------------------------------------------- | --------------------------------- |  | ------ | --------------------- | ------ | -------------------- |  | 
|                                            |                                   |  |        | As                    |        | Had Been             |  | 
|                                            |                                   |  |        | Presented             |        | Prior To 1999        |  | 
|Balance Sheet - December 31, 1999 - (000's) |                                   |  |        |                       |       
|                                            | Loans, Net of Allowance           |  |        | $          127,711    |        | $          165,556   |  | 
|                                            | Securities                        |  |        | 25,991                |        | 52,264               |  | 
|                                            | Total Assets                      |  |        | 166,963               |        | 237,020              |  | 
|                                            |                                   |  |        |                       |        |                      |  | 
|                                            | Deposits                          |  |        | 141,278               |        | 198,130              |  | 
|                                            |                                   |  |        |                       |        |                      |  | 
|                                            | Shareholders Equity               |  |        | 9,849                 |        | 18,063               |  | 
|                                            |                                   |  |        |                       |        |                      |  | 
|Income Statement - 1999  - (000's)          |                                   |  |        |                       |        |                     
|                                            | Net Interest Income               |  |        | $              5,644  |        | $             8,059  |  | 
|                                            | Provision for Loan Losses         |  | (284)  |                       | (309)  |                      | 
|                                            | Noninterest Income                |  |        | 805                   |        | 980                  |  | 
|                                            | Noninterest Expense               |  |        | (4,467)               |        | (6,025)              |  | 
|                                            |                                   |  |        |                       |        |                      |  | 
|                                            | Income Before Income Tax          |  | 1,698  |                       | 2,705  |                      | 
|                                            | Provision for Income Taxes        |  | (350)  |                       | (550)  |                      | 
|                                            |                                   |  |        |                       |        |                      |  | 
|                                            | Income After Income Taxes         |  | 1,348  |                       | 2,154  |                      | 
|                                            | Loss of Unconsolidated Subsidiary |  | (12)   |                       | (25)   |                      | 
|                                            |                                   |  |        |                       |        |                      |  | 
|                                            | Net Income                        |  |        | $              1,336  |        | $             2,129  |  | 
|                                            |                                   |  |        |                       |        |                      |  | 
|Per Share Information -                     |                                   |  |        |                       |        |                      | 
|                                            | Book Value                        |  |        | $                8.22 |        | $               7.91 |  | 
|                                            | Earnings Per Share -              |  |        |                       |        |                      |  | 
|                                            | Basic                             |  |        | $               1.12  |        | $               0.94 |  | 
|                                            | Diluted                           |  |        | $                1.01 |        | $               0.88 |  | 
|                                            |                                   |  |        |                       |        |                      |  | 
|Operating Ratios -                          |                                   |  |        |                       |        |                      | 
|                                            | Return on Average Assets          |  | 0.85%  |                       | 0.94%  |                      | 
|                                            | Return on Average Equity          |  | 13.21% |                       | 11.49% |                      | 
|                                            | Net Interest Margin -             |  |        |                       |        |                      |  | 
|                                            | (fully taxable equivalent)        |  | 4.04%  |                       | 4.09%  |                      | 
|                                            | Efficiency Ratio                  |  |        | 65.64%                |        | 62.14%               |  | 

Note Q - Retirement of Stock Coincident with Merger

As part of the merger process, two shareholders of The Company followed the prescribed process
and became "dissenting" shareholders.  They then requested that their shares be redeemed at the
fair value.  The result of this process is that a total of 53,318 of the shares outstanding at
December 31, 1999 will be redeemed.  The amount likely to be paid to the former shareholders,
$919,735, will be a reduction to Stockholders' Equity.  The impact on book value per share will
be to reduce the merger-adjusted amount reflected in Note P of $7.91 to $7.69.

Note R - Market for Registrant's Common Equity and Related Shareholders' Matters

There is currently no established trading market for the Corporation's common stock.  Because
the Corporation is not public, the stock often trades without the Corporation having knowledge
of the trade.  The Corporation knows that there were trades in its stock during 1998 and 1999 if
which it was not aware.  The trades that it is aware of from the market makers in the
Corporation's stock are those outlined.  The prices given are interdealer without retain markups,
markdowns or commissions.  All numbers on the following tables are adjusted to give effect to
the four-for-one stock split of June 1, 1998.

|               |                      |  |                     |  |                      |  | 
|-------------- | -------------------- |  | ------------------- |  | -------------------- |  | 
|               |                      |  |                     |  | Per Share            |  | 
|               | Per Share Bid Prices |  | Dividends           |  |                     
|1998           | High                 |  | Low                 |  | Declared             |  | 
|First Quarter  | $    10.25           |  | $              9.50 |  | $                  - |  | 
|Second Quarter | 11.50                |  | 10.32               |  | -                    |  | 
|Third Quarter  | 13.00                |  | 11.50               |  | -                    |  | 
|Fourth Quarter | 14.75                |  | 14.00               |  | -                    |  | 
|               |                      |  |                     |  |                      |  | 
|1999           |                      |  |                     |  |                      |  | 
|First Quarter  | $    16.50           |  | $            16.25  |  | $                  - |  | 
|Second Quarter | 19.00                |  | 17.38               |  | 0.11                 |  | 
|Third Quarter  | 19.00                |  | 17.25               |  | 0.11                 |  | 
|Fourth Quarter | 17.25                |  | 16.25               |  | 0.11                 |  | 

|UNITED BANCSHARES, INC.                         
|------------------------------------------------
|PARENT ONLY                                     
|COLUMBUS GROVE, OHIO                            
|BALANCE SHEETS                                  
|                                                
|                                                
|ASSETS                                          
|Cash                                            
|Investment in Banking Subsidiary                
|Investment in Unconsolidated Subsidiary         
|Other Investments                               
|Other Assets                                    
|Total Assets                                    
|LIABILITIES                                     
|Deferred Compensation                           
|                                                
|STOCKHOLDERS' EQUITY                            
|Stockholders' Equity -                          
|Common Stock                                    
|Capital Surplus                                 
|Retained Earnings                               
|Total Stockholders' Equity                      
|Total Liabilities & Stockholders' Equity        
|                                                
|STATEMENTS OF INCOME                            
|                                                
|                                                
|                                                
|Operating Income -                              
|None                                            
|Operating Expenses -                            
|Salaries and Related Costs                      
|Professional Fees                               
|Miscellaneous Operating Expenses                
|Total Operating Expenses                        
|                                                
|Income Before Undistributed Income of Subsidiary
|Equity in Bank Subsidiary                       
|Income Before Taxes                             
|Income Tax                                      
|Income After Income Taxes                       
|Operating Loss of Unconsolidated Subsidiary     
|Net Income                                      







STATEMENTS OF STOCKHOLDERS' EQUITY

|                                                              |                          |                             | Capital in                 |                           |                              |                            
|------------------------------------------------------------- | ------------------------ | --------------------------- | -------------------------- | ------------------------- | ---------------------------- | ---------------------------
|                                                              |                          |                             | Excess of                  |                           |                              | Total                      
|                                                              |                          | Common                      | Stated                     | Retained                  | Treasury                     | Stockholders'              
|                                                              |                          | Stock                       | Value                      | Earnings                  | Stock                        | Equity                     
|                                                              |                          | $      258,446              | $  1,555,657               | $  4,945,106              | $                -           | $   6,759,209              
|Net Income                                                    |                          | -                           | -                          | 1,501,996                 | -                            | 1,501,996                  
|Stock Dividends                                               |                          | 6,612                       | 222,577                    | (229,189)                 | -                            | -                          
|Purchase of Treasury Stock                                    | -                        | -                           | -                          | (212,284)                 | (212,284)                   
|Exercise of Stock Options                                     | 16,786

-------------    | 414,085 

-------------     | - 

-------------          | - 

-------------         | 430,871

-------------      
|Balances December 31, 1997                                    |                          | 281,844                     | 2,192,319                  | 6,217,913                 | (212,284)                    | 8,479,792                  
|                                                              |                          |                             |                            |                           |                              |                            
|Net Income                                                    |                          | -                           | -                          | 1,541,623                 | -                            | 1,541,623                  
|Stock Split                                                   |                          | 861,421                     | (861,421)                  | -                         | -                            | -                          
|Stock Dividends                                               |                          | 22,909                      | 307,734                    | (330,645)                 | -                            | (2)                        
|Sale of Treasury Stock                                        |                          | -                           | -                          | -                         | 212,284                      | 212,284                    
|Redeem Fractional Shares                                      | -                        | (7,707)                     | -                          | -                         | (7,707)                     
|Exercise of Stock Options                                     | 10,626

-------------    | 95,577 

-------------      | - 

-------------          | - 

-------------         | 106,203

-------------      
|Balances December 31, 1998                                    |                          | 1,176,800                   | 1,726,502                  | 7,428,891                 | -                            | 10,332,193                 
|                                                              |                          |                             |                            |                           |                              |                            
|Net Income                                                    |                          | -                           | -                          | (157,851)                 | -                            | (157,851)                  
|Stock Dividends                                               |                          | 7,213                       | 109,998                    | (117,211)                 | -                            | -                          
|Redeem Fractional Shares                                      | -                        | (3,354)                     | -                          | -                         | (3,354)                     
|Cash Dividends Paid                                           | -                        | -                           | (393,341)                  | -                         | (393,341)                   
|Exercise of Stock Options                                     | 14,664

-------------    | 56,790 

-------------      | - 

-------------          | - 

-------------         | 71,454 

-------------      
|Balances December 31, 1999                                    |                          | $     1,198,677

========== | $ 1,889,936

========      | $ 6,760,488 

=========   | $              - 

========= | $   9,849,101

=========   
|                                                              |                          |                             |                            |                           |                              |                            
|                                                              |                          | STATEMENTS OF CASH FLOWS   
|                                                              |                          |                             |                            |                          
|                                                              |                          |                             |                            | For the Years Ended      
|                                                              |                          |                             |                            | December 31              
|                                                              |                          |                             |                            | 1999                      | 1998                         | 1997                       
|                                                              |                          |                             |                            |                           |                              |                            
|Cash Flows from Operating Activities                          |                          |                             |                            |                           |                             
|Net Income                                                    |                          |                             |                            | $  (157,851)              | $  1,541,623                 | $   1,501,996              
|Adjustments -                                                 |                          |                             |                            |                           |                              |                            
|Loss (before tax effect) of Loss of Unconsolidated Subsidiary | 18,747                   | -                           | -                         
|(Increase) in Accounts Receivable                             |                          | (4,128)                     | (76,201)                   | (92,052)                 
|Increase in Liabilities                                       |                          |                             | 41,600 

-------------     | 100,800 

-------------   | - 

-------------           
|                                                              |                          |                             |                            |                           |                              |                            
|Net Cash Provided from Operating Activities                   | (101,632)

------------- | 1,566,222 

-------------   | 1,409,944 

------------- 
|                                                              |                          |                             |                            |                           |                              |                            
|Cash Flows from Investing Activities:                         |                          |                             |                           
|Net Increase in Investment in Banking Subsidiary              | 274,030                  | (1,586,779)                 | (1,508,632)               
|Increase in Investment in Unconsolidated Subsidiary           | (45,000)                 | (95,000)                    | -                         
|Purchases of Other Investments                                |                          | - 

-------------           | (100,000)

-------------   | - 

-------------        
|                                                              |                          |                             |                            |                           |                              |                            
|Net Cash Provided from Investing Activities                   | 229,030 

-------------  | (1,781,779)

-------------  | (1,508,632)

-------------
|                                                              |                          |                             |                            |                           |                              |                            
|Cash Flows from Financing Activities                          |                          |                             |                            |                           |                             
|Sale/(Purchase) of Treasury Stock                             |                          | -                           | 212,284                    | (212,284)                
|Redemption of Fractional Shares                               |                          | (3,354)                     | (7,707)                    | -                        
|Cash Dividends Paid                                           |                          |                             |                            | (393,341)                 | -                            | -                          
|Exercise of Stock Options                                     |                          |                             | 71,454 

-------------     | 106,203 

-------------   | 430,871 

-------------     
|Net Cash Provided from Financing Activities                   | (325,241)

------------- | 310,780 

-------------     | 218,587 

-------------   
|                                                              |                          |                             |                            |                           |                              |                            
|Net Change in Cash                                            |                          |                             |                            | (197,843)                 | 95,223                       | 119,899                    
|                                                              |                          |                             |                            |                           |                              |                            
|Cash at January 1                                             |                          |                             |                            | 219,528 

-------------   | 124,305 

-------------      | 4,406 

-------------      
|                                                              |                          |                             |                            |                           |                              |                            
|Cash at December 31                                           |                          |                             |                            | $      21,685 

========= | $    219,528 

=========     | $       124,305 

=========

UNITED BANCHARES, INC.

COLUMBUS GROVE, OHIO

DIRECTORS

DIRECTORS - UNITED BANCSHARES. INC.

|Joe S. Edwards, Jr.

Investor/Attorney      |                           | William R. Perry

Farmer  
|------------------------------------------- | ------------------------- | --------------------------
|                                           
|Thomas J. Erhart

Retired/Insurance Agency  |                           | James N. Reynolds

Banking
|                                           
|E. Eugene Lehman

Banking                   |                           | H. Edward Rigel

Farmer   
|                                           
|Carl L. McCrate

Retired/Hardware Retailing | Daniel W. Schutt

Banking

DIRECTORS - THE UNION BANK COMPANY

|Jane E. Gettman

Telephone Consultant                  |                                     | Daniel W. Schutt

President                             
|------------------------------------------------------ | ----------------------------------- | --------------------------------------------------------
|                                                       |                                     |                                                         
|Herbert H. Huffman

Educator                           |                                     | Dr. C. John Stechschulte

Retired/Physician/Pediatrician
|                                                      
|E. Eugene Lehman

Chairman and Chief Executive Officer | R. Steven Unverferth

Manufacturing
|                                                      
|Robert M. Schulte, Sr.

Businessman/Interim Personnel  | John O. Williams

Retired/Trucking 
|                                                      

DIRECTORS - THE BANK OF LEIPSIC

|Joe S. Edwards, Jr.

Investor/Attorney                | James N. Reynolds

Chairman        
|----------------------------------------------------- | -----------------------------------
|                                                     
|Kevin L. Lammon

Insurance and Real Estate Sales      | H. Edward Rigel

Farmer            
|                                                     
|William R. Perry

Farmer                              | George W. White

Retired Pharmacist
|                                                     
|Larry D. Place

President and Chief Executive Officer

UNITED BANCHARES, INC.

COLUMBUS GROVE, OHIO

OFFICERS

OFFICERS - UNITED BANCSHARES, INC.

|James N. Reynolds | Chairman           
|----------------- | -------------------
|E. Eugene Lehman  | President          
|Carl L. McCrate   | Secretary-Treasurer

OFFICERS - THE UNION BANK COMPANY

|E. Eugene Lehman     | Chairman and Chief

Executive Officer | Rose A. Recker        |                          | Assistant Vice President           
|-------------------- | ------------------------------------- | --------------------- | ------------------------ | -----------------------------------
|Daniel W. Schutt     | President                             |                       | Heather M. Oatman        |                                    
|David A. Anderson    | Vice President                        | Gary J. Selhorst      |                          | Assistant Vice President           
|Nancianne Carroll    | Vice President                        | Barry J.von der Embse | Assistant Vice President
|Norman V.
Schnipke   | Vice President                        | Edward B. Beecher     |                          | Manager of Information
Technologies
|Bonita R. Selhorst   | Vice President                        | Keith R. Belcher      |                          | Consumer Loan Officer              
|Anna Maria
Brenneman | Assistant Vice President              | Sharon M. Kohler      | Loan Review Officer     
|Mark G. Honigford    | Assistant Vice President              | Max E. Long           |                          | Microcomputer Specialist           
|Dennis E. Kimmet     | Assistant Vice President              | Kathleen A. Reinsel   | Marketing Officer       
|Todd A. Mason        | Assistant Vice President              | Brian W. Wentling     | Financial Consultant    
|Dennis J.
Meuleman   | Assistant Vice President              | Lynda S. Wright       | Branch Manager          

OFFICERS - THE BANK OF LEIPSIC

|James N. Reynolds   | Chairman                              | Beth L. Parys      | Assistant Vice President
|------------------- | ------------------------------------- | ------------------ | ------------------------
|Joe S. Edwards, Jr. | Vice Chairman                         | Michael
Siebeneck  | Assistant Vice President
|Larry D. Place      | President and Chief
Executive Officer | Patricia
Christman | Assistant Cashier       
|Mary L. Schroeder   | Cashier                               |                    |                         

|                                     |                             |  |  |  | EXHIBIT 21
|------------------------------------ | --------------------------- |  |  |  | ----------
|UNITED BANCSHARES, INC. SUBSIDIARIES |                             | 
|                                     |                             |  |  |  |           
|                                     | The Union Bank Company      |  |  | 
|                                     | Columbus Grove, Ohio        |  | 
|                                     |                             |  |  |  |           
|                                     | The Bank of Leipsic Company |  | 
|                                     | Leipsic, Ohio               |  |  | 

EXHIBIT 23.1

CONSENT OF INDEPENDENT AUDITORS

We consent to the inclusion in the 1999 form 10-K of our report dated February 25, 2000, with
respect to the consolidated balance sheets of United Bancshares, Inc. and Subsidiary as of
December 31, 1999 and 1998 and the related consolidated statements of income, changes in
shareholders' equity and cash flows for the three years then ended:

/S/  E. S. EVANS AND COMPANY

_________________________________

E. S. Evans and Company

Lima, Ohio

March 22, 2000