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

                                  UNITED STATES
                       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

                   For the Fiscal Year Ended December 31, 2004

                         Commission File Number 0-26876

                            OAK HILL FINANCIAL, INC.
             (Exact name of Registrant as specified in its charter)

                 Ohio                                 31-1010517
      (State or jurisdiction of          (I.R.S. Employer Identification Number)
    incorporation or organization)

             14621 S.R. 93
              Jackson, OH                                45640
(Address of principal executive offices)               (Zip Code)

       Registrant's telephone number, including area code: (740) 286-3283

                Securities pursuant to Section 12(b) of the Act:
                                      None

           Securities registered pursuant to Section 12(g) of the Act:
                         Common stock without par value

      Check whether the registrant (1) filed all reports required to be filed by
Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 during the past 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 |_|

      Check if  disclosure  of  delinquent  filers  in  response  to Item 405 of
Regulation  S-K is not  contained  in  this  form,  and no  disclosure  will  be
contained,  to  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. |_|

      Check whether the registrant is an  accelerated  filer (as defined in Rule
12b-2 of the Act). Yes |X| No |_|

      The aggregate market value of the voting and non-voting common equity held
by non-affiliates of the registrant  computed by reference to the price at which
the common  equity was last sold,  or the  average  bid and asked  price of such
common  equity,  as of June 30, 2004 was  $124,271,658.00.  For purposes of this
calculation,  executive  officers and directors of the registrant are considered
affiliates.

      There were 5,577,903 shares of the registrant's  common stock  outstanding
on March 18, 2005.

                       DOCUMENTS INCORPORATED BY REFERENCE

      Portions of the  Registrant's  Annual Report to Stockholders  for the year
ended December 31, 2004 are incorporated by reference into Part II and IV.

      Portions  of the  proxy  statement  dated  March 18,  2005 for the  Annual
Meeting of Stockholders to be held April 12, 2005 are  incorporated by reference
into Part III.

<PAGE>

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

                            OAK HILL FINANCIAL, INC.
                          2004 FORM 10-K ANNUAL REPORT

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                     Page
<S>                                                                                                   <C>
PART I
------
Item 1.    Business                                                                                    3
Item 2.    Properties                                                                                 18
Item 3.    Legal Proceedings                                                                          19
Item 4.    Submission of Matters to a Vote of Security Holders                                        19

PART II
-------
Item 5.    Market for Registrant's Common Equity and Related Stockholder Matters                      20
Item 6.    Selected Financial Data                                                                    22
Item 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations      31
Item 7A.   Quantitative and Qualitative Disclosures About Market Risk                                 31
Item 8.    Financial Statements and Supplementary Data                                                31
Item 9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure       31
Item 9A.   Controls and Procedures                                                                    31
Item 9B.   Other Information                                                                          33

PART III
--------
Item 10.   Directors and Executive Officers of the Registrant                                         34
Item 11.   Executive Compensation                                                                     34
Item 12.   Security Ownership of Certain Beneficial owners and Management and Related                 34
               Stockholder Matters                                                                    34
Item 13.   Certain Relationships and Related Transactions                                             34
Item 14.   Principal Accountant Fees and Services                                                     34

PART IV
-------
Item 15.   Exhibits, Financial Statement Schedules and Reports on Form 8-K                            34

SIGNATURES                                                                                            37
</TABLE>


                                        2
<PAGE>

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

                                     PART I

Item 1. Business.

Oak Hill Financial, Inc.
------------------------

      Oak Hill Financial,  Inc., an Ohio corporation  (the "Company")  formed in
1981, is a financial  holding company  registered under the Bank Holding Company
Act of 1956, as amended (the "Act"), and is subject to regulation by the Federal
Reserve  Board.  The Company  engages  indirectly  in the business of commercial
banking and other permissible activities closely related to banking and consumer
finance  lending  through five wholly owned  subsidiaries,  Oak Hill Banks ("Oak
Hill"),  Oak Hill  Financial  Insurance  Agency,  Inc.  dba MPA Group  Insurance
Specialists  ("MPA") and Oak Hill Capital Trust 1, 2, and 3 (the "Trusts").  The
Company also owns forty-nine percent of Oak Hill Title Agency ("Oak Hill Title")
which  provides  title  services  for  commercial  and  residential  real estate
transactions.  The Company  provides  management  and similar  services  for its
subsidiaries.  Since it does not conduct any operating  businesses  itself,  the
Company must depend  largely upon its  subsidiaries  for funds with which to pay
the expenses of its operation  and, to the extent  applicable,  any dividends on
its  outstanding  shares of stock.  For further  information,  see Note A of the
Notes to Consolidated  Financial  Statements  appearing in the Company's  Annual
Report to  Stockholders,  which is incorporated by reference in response to this
item.

      The Company  faces strong  competition  from both banking and  non-banking
institutions.  Its banking competitors include local and regional banks and bank
holding companies,  as well as some of the largest banking  organizations in the
United  States.  In  addition,  other types of financial  institutions,  such as
savings and loan associations and credit unions,  offer a wide range of loan and
deposit  services that are directly  competitive with those offered by Oak Hill.
The  consumer is also served by  brokerage  firms and mutual  funds that provide
checking services,  credit cards, and other services similar to those offered by
Oak Hill.  Major  stores  compete for loans by offering  credit cards and retail
installment  contracts.  It is anticipated  that  competition  from non-bank and
non-savings and loan organizations will continue to grow.

      The range of services  provided  by the  Company's  subsidiaries  to their
customers includes  commercial  lending,  real estate lending,  consumer credit,
credit card, other personal loan financing, deposits, group health insurance and
other employee benefits,  and title services for commercial and residential real
estate transactions.  Each of the subsidiaries operates under the direction of a
Board of Directors and officers.

      The  Company's  internet  site  www.oakf.com  contains a hyperlink  to the
Securities and Exchange Commission's ("SEC") website, where the Company's annual
report on Form 10-K,  quarterly  reports on Form 10-Q,  current  reports on Form
8-K, and all amendments, if any, to these reports filed pursuant to Sections 13a
or 15d of the Securities  Exchange Act of 1934 can be obtained free of charge on
EDGAR as soon as reasonably  practicable  after the Company has filed the report
with the SEC.

Lending Activities
------------------

      General.  The Company  generally  makes loans in southern and central Ohio
where its branches are located.  The Company's  principal lending activities are
the origination of (i) conventional  one-to-four  family  residential loans, and
(ii) commercial  loans,  most of which are secured by real estate located in the
Company's primary market area. These loan categories accounted for approximately
94% of the Company's net loan  portfolio at December 31, 2004.  The Company also
makes consumer loans,  including  installment loans, home equity lines of credit
and second mortgages, and offers credit cards.

      Loan Portfolio  Composition  and Activity.  The following table sets forth
the  composition  of the  Company's  loan  portfolio  in dollar  amounts  and in
percentages  for each of the last five  years,  along with a  reconciliation  to
loans receivable, net of the allowance for loan losses.


                                        3
<PAGE>

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

<TABLE>
<CAPTION>
====================================================================================================================================
                                                                   At December 31,
====================================================================================================================================
                                    2004                 2003                  2002                  2001                2000
====================================================================================================================================
                               Amount   Percent     Amount   Percent     Amount   Percent      Amount    Percent    Amount   Percent
====================================================================================================================================
<S>                          <C>          <C>     <C>          <C>     <C>          <C>      <C>          <C>     <C>         <C>
Type of loan:

   1-4 family residential    $ 270,092     29.6%  $ 235,180     29.0%  $ 245,794     35.0%   $ 373,323     57.8%  $ 240,593    40.1%
   Commercial and other        584,201     64.0     513,848     63.3     391,586     55.8      216,611     33.5     275,500    46.0
   Consumer                     68,072      7.5      71,100      8.8      72,012     10.3       62,829      9.7      88,585    14.8
   Credit cards                  2,020      0.2       1,729      0.2       1,694      0.2        1,663      0.3       1,605     0.3
====================================================================================================================================

Total loans                    924,385    101.3     821,857    101.3     711,086    101.3      654,426    101.3     606,283   101.2

Less:
   Allowance for
      loan losses              (11,847)    (1.3)    (10,836)    (1.3)     (9,142)    (1.3)      (8,345)    (1.3)     (7,197)   (1.2)
====================================================================================================================================
Total loan receivable,
  net                        $ 912,538    100.0%  $ 811,021    100.0%  $ 701,944    100.0%   $ 646,081    100.0%  $ 599,086   100.0%
====================================================================================================================================
</TABLE>

      The following is maturity information with respect to commercial loans at
December 31, 2004.

<TABLE>
<CAPTION>
====================================================================================================================================
                                  After one year                 After five years
Less than one year              through five years               through ten years                After ten years
====================================================================================================================================
             Weighted                        Weighted                        Weighted                         Weighted
             Average                         Average                         Average                          Average
Amount        Yield          Amount           Yield           Amount          Yield            Amount          Yield        Total
====================================================================================================================================
<S>            <C>           <C>               <C>           <C>               <C>            <C>               <C>       <C>
$151,917       5.71%         $121,647          6.08%         $ 78,619          6.00%          $232,018          6.58%     $584,201
====================================================================================================================================
</TABLE>

      As of December 31, 2004,  there were $191.3 million  fixed-rate and $241.0
million variable-rate commercial loans maturing in more than one year.

      Loans Secured by One- to Four-Family Real Estate. A significant portion of
the Company's  lending  activity is the  origination  of permanent  conventional
loans  secured by one-to  four-family  residences  located  within the Company's
primary market area. The Company  typically makes adjustable rate mortgage loans
and holds the loans in portfolio.  More than 49% of the  Company's  portfolio of
permanent  conventional mortgage loans secured by one-to four-family  residences
are  adjustable  rate.  The  Company  also  underwrites  fixed-rate  residential
mortgage loans,  and may sell those loans on a  servicing-retained  basis in the
secondary market to the Federal Home Loan Mortgage  Corporation  ("FHLMC") or to
the Federal National Mortgage Association  ("FNMA"),  or on a servicing-released
basis to another financial institution.

      The Company makes fixed-rate loans on one- to four-family residences up to
100% of the value of the real estate and improvements  (the  "loan-to-value"  or
"LTV") substantially all of which are sold in the secondary market.  Residential
real estate  loans are  offered by the Company for terms of up to 30 years.  The
Company requires  private  mortgage  insurance on secondary market loans for the
amount of such loans in excess of 80% of the value of the real  estate  securing
such loans.

      The aggregate amount of the Company's one-to four-family  residential real
estate loans  totaled  approximately  $270.1  million at December 31, 2004,  and
represented  29.6% of net loans at such  date.  At such date,  loans  secured by
residential real estate with outstanding balances of approximately $3.2 million,
or 1.2%, of its total one-to  four-family  residential real estate loan balance,
were more than 90 days delinquent or nonaccruing.

      Commercial  Loans.  The  Company  is also  active in  commercial  lending,
primarily to smaller  businesses in the  Company's  primary  market area.  These
loans are typically  secured by commercial real estate and priced in relation to
the prime  rate or the one year,  three year or five year U.S.  Treasury  Index.
Such loans generally have terms of up to 25 years and loan-to-value ratios of up
to 80%. The Company also makes commercial loans secured by collateral other than
real estate and unsecured commercial loans. Other


                                        4
<PAGE>

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

secured and unsecured  commercial  loans are also typically priced at spreads to
prime or the one year,  three  year or five year  U.S.  Treasury  Index and have
maturities of up to five years.

      Loan officers review the borrower's  financial  statements,  appraisals of
the collateral,  and other related  documents before  recommending  funding of a
commercial  loan.  The loan officer and the approving  officer or committee then
determines  that  there is  sufficient  income  to cover  this  and  other  loan
payments,  that  the  collateral  is of  adequate  liquidation  value,  that the
applicant  has  a  good  payment  history  and  is  capable  of  performing  the
requirements  of the loan.  Other reviews and analysis are done as  appropriate,
depending upon the complexity of the credit request.

      Although a risk of  nonpayment  exists with respect to all loans,  certain
specific  types of risks are  associated  with  different  types of  loans.  The
primary risks associated with commercial loans are the quality of the borrower's
management and the impact of national and regional economic factors. The Company
mitigates  these risks by  maintaining  a close  working  relationship  with its
borrowers, by obtaining  cross-collateralization  and personal guarantees of its
loans, and by diversification within its loan portfolio.

      Real estate is frequently a material  component of the  collateral for the
Company's  loans.  The expected  source of repayment of these loans is generally
the  operations  of the  borrower's  business,  but the real estate  provides an
additional   measure   of   security,   particularly   when  the   property   is
owner-occupied. For this reason, real estate is considered additional collateral
on many of the Company's commercial loans.

      Risks  associated with real estate loans include  fluctuating land values,
changes in tax policies,  and concentration of loans within the Company's market
area.  The  Company  mitigates  these  risks  by  generally  providing  loans to
experienced  commercial real estate owners and  developers.  The risk is further
mitigated by the number of commercial  real estate loans made to the user of the
property.

      The aggregate amount of the Company's commercial loans without real estate
as primary or  secondary  collateral  totaled  approximately  $173.8  million at
December 31, 2004, and  represented  29.7% of commercial  loans at that date. At
such  date,  commercial  loans  without  real  estate as  primary  or  secondary
collateral  that  were  more  than 90 days  delinquent  or  nonaccruing  totaled
approximately  $404,000,  or 0.3% of such  loans.  The  aggregate  amount of the
Company's  commercial loans with real estate as primary or secondary  collateral
was  approximately  $410.4  million  at  December  31,  2004,  and at such date,
approximately $2.0 million in outstanding  balances, or 0.5% of such loans, were
more than 90 days delinquent or nonaccruing.

      Consumer  Loans.  The  Company  offers  several  consumer  loan  products,
including installment loans, home equity lines of credit and credit cards.

      The  Company  has  developed  working   relationships   with  several  car
dealerships in its market area, and is able to do some financing of new and used
cars through these  relationships.  The Company generally finances cars that are
seven years old or newer.  These loans generally have fixed rates and maturities
of 36 to 72 months.

      To  a  lesser  degree,   the  Company  makes  small   unsecured  loans  to
creditworthy  individuals.  These loans are typically between $2,000 and $5,000,
at fixed rates, with maturities of less than five years. The Company also offers
a home equity loan  product and a credit  card  product to its  customers.  Both
products are  underwritten  to the same standards as any of the Company's  other
consumer loan products.

      Loan officers underwrite installment loan and other consumer loan requests
in such a manner to  assure  compliance  with the  various  regulations  and the
Company's  underwriting  standards.  The payment  history of  applicants is very
important on these smaller loans,  and is checked  through  in-house  records as
well as credit bureaus. Normally, collateral, such as an automobile, is taken as
security and the value is checked through the N.A.D.A. book or another valuation
service.  Income must be adequate to cover all monthly  payments  including  the
proposed loan.

      At December 31, 2004, the Company had  approximately  $70.1 million in its
consumer loan and credit card  portfolio,  which was 7.7% of the Company's total
net loans. Approximately $603,000 of these loans were over 90 days delinquent or
nonaccruing on that date, which represented 0.9% of the consumer loan portfolio.

      Loan  Solicitation and Processing.  Loan originations are developed from a
number  of  sources,  including  continuing  business  with  depositors,   other
borrowers and real estate  developers,  solicitations  by the Company's  lending
staff, and walk-in customers.

      Underwriting  guidelines for all branches and loan types are set by senior
management  at  an   administrative   office.   Consumer  loan   processing  and
underwriting are decentralized;  however, all other loans, including real estate
and commercial loans, are generally  processed and underwritten  centrally at an
administrative  office.  Loan  applications,  as well as credit bureau  reports,
appraisals,   financial   information,   verifications  of  income,   and  other
documentation concerning the credit-worthiness of the borrower, as applicable to
each loan type are reviewed.


                                        5
<PAGE>

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

      Branch  managers may have the  authority  to approve  loans up to $120,000
that meet the  underwriting  criteria set by management,  and area managers have
authority  for amounts up to $500,000.  Any loan greater than  $500,000  must be
approved by senior management.

      Income from Lending Activities.  The Company earns interest and fee income
from its lending  activities.  The Company earns fees for originating  loans and
for making commitments to originate loans and loan participations. Certain fees,
net of origination  costs, are deferred and amortized over the life of the loan.
The Company also receives fees related to existing loans,  such as late charges.
Income from loan  origination and commitment fees and discounts  varies with the
volume and type of loans and commitments  made and with competitive and economic
conditions.  Note  A-4 to  the  Consolidated  Financial  Statements  contains  a
discussion of the manner in which  origination fees are recognized for financial
reporting  purposes.   In  addition,   the  Company  conducts  mortgage  banking
activities,  whereby, the Company sells certain fixed-rate  residential loans in
the  secondary  market to the FHLMC and FNMA,  recognizing  gains  upon the sale
comprised of a cash component as well as mortgage servicing rights.

Nonperforming Loans
-------------------

      General. Late charges on residential mortgages are assessed by the Company
if a payment is not received  either by the 10th day  following  its due date or
15th day if the loan has been sold in the secondary market and is being serviced
by the  Company.  Late charges on  installment  loans and  commercial  loans are
assessed by the Company if a payment is not  received by the 10th day  following
its due date. Any borrower whose payment was not received by this time is mailed
a past  due  notice.  If the loan is still  delinquent  after a second  past due
notice  is  mailed  (generally  around  the 20th day of  delinquency),  a branch
employee  will attempt to contact the customer to resolve any problem that might
exist.

      When an advanced stage of delinquency  appears  (generally around the 60th
day of  delinquency)  and if  repayment  cannot be expected  within a reasonable
amount of time or a  repayment  agreement  has not been  reached,  Oak Hill will
contact an  attorney  and  request  that the  required  30-day  prior  notice of
foreclosure  or  repossession  proceedings  be  prepared  and  delivered  to the
borrower so that, if necessary, foreclosure proceedings may be initiated shortly
after the loan is 90 days delinquent.  Historically, this procedure has aided in
achieving a low level of nonperforming  loans and, as of December 31, 2004, only
$6.3  million or 0.7% of the  Company's  total loan  portfolio  was over 90 days
delinquent  or  nonaccruing.  As of December 31, 2004,  the  Company's  level of
nonperforming assets to total assets was 0.7%.

      If a credit card account becomes 10 days  delinquent,  a notice is sent to
the  account  holder  demanding  that the  payment be made to bring the  account
current. Another notice is sent to the cardholder if the account becomes 20 days
delinquent.  If payment is not received within 30 days,  authorization  requests
are denied, a message about the delinquency appears on the cardholder's  account
statement,  and a follow-up  telephone call is made. These telephone  collection
efforts  and account  statement  messages  continue  until the account is deemed
uncollectible.  Legal action is considered  during this time. As of December 31,
2004,  approximately  $14,000 in  outstanding  balances,  or 0.7% of credit card
loans were nonperforming.

      At December 31, 2004, the Company had $1.6 million in real estate or other
repossessed  collateral acquired as a result of foreclosure,  voluntary deed, or
other means.  Such real estate is  classified as "other real estate owned" until
it is sold and is recorded at the lower of cost (the unpaid principal balance at
the date of acquisition  plus foreclosure and other related costs) or fair value
less  estimated  selling  expenses.  Any  subsequent  write-down  is  charged to
expense.  Generally,  unless the property is a  one-to-four  family  residential
dwelling and  well-collateralized,  interest  accrual  ceases in 90 days, but no
later  than the date of  acquisition.  From that  date,  all costs  incurred  in
maintaining  the property are  expensed.  "Other real estate owned" is appraised
during the foreclosure process, prior to the time of acquisition, and losses are
recognized  for the amount by which the book value of the related  mortgage loan
exceeds the estimated net realizable value of the property.

      The  Company  had $3.8  million and $4.0  million of  impaired  loans,  as
defined  under SFAS No. 114, at December  31, 2004 and 2003,  respectively.  The
Company maintained an allowance for credit losses related to such impaired loans
of $1.3 million and $982,000 at December 31, 2004 and 2003, respectively.


                                        6
<PAGE>

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

      The  following  is a summary of the  Company's  loan loss  experience  and
selected ratios for the periods presented.

<TABLE>
<CAPTION>
=============================================================================================================================
                                                                             Year Ended December 31,
=============================================================================================================================
                                                       2004           2003            2002            2001             2000
=============================================================================================================================
                                                                              (Dollars in thousands)
<S>                                                 <C>             <C>             <C>             <C>             <C>
Allowance for loan losses                           $ 10,836        $  9,142        $  8,345        $  7,197        $  6,132
   (beginning of period)
Loans charged-off:
   1-4 family residential                                226             129             215             172             219
   Multi-family and commercial real estate             1,214             226           1,064              50              37
   Commercial and industrial                             334             442             148             239               2
   Consumer                                            1,771           1,355           1,136           1,365           1,155
=============================================================================================================================
     Total loans charged-off                           3,545           2,152           2,563           1,826           1,413

Recoveries of previously charged-off loans:
   1-4 family residential                                 35              27              14              20              20
   Multi-family and commercial real estate               604              62             118              28               3
   Commercial and industrial                              99              14             103               8               1
   Consumer                                              553             396             368             327             191
=============================================================================================================================
     Total recoveries                                  1,291             499             603             383             215
=============================================================================================================================
Net loans charged-off                                  2,254           1,653           1,960           1,443           1,198
Provision for losses on loans                          3,136           3,347           2,757           2,591           2,263
Allowance of acquired institution
     and other                                           129              --              --              --              --
=============================================================================================================================

Allowance for loan losses
   (end of period)                                  $ 11,847        $ 10,836        $  9,142        $  8,345        $  7,197
=============================================================================================================================

Loans outstanding:
   Average, net                                     $869,849        $754,519        $690,545        $623,486        $557,038
   End of period                                    $924,385        $821,857        $711,086        $654,426        $606,283
Ratio of allowance for loan losses to
   loans outstanding at end of period                   1.28%           1.32%           1.29%           1.28%           1.19%
Ratio of net charge-offs to average
   loans outstanding                                    0.26%           0.22%           0.28%           0.23%           0.22%
=============================================================================================================================
</TABLE>

      At December 31, 2004, 2003 and 2002, the Company had  nonperforming  loans
totaling $6.3 million,  $8.1 million, and $7.3 million,  respectively.  Interest
income that would have been recognized if such loans had performed in accordance
with contractual terms totaled approximately  $406,000,  $508,000, and $357,000,
for the years ended December 31, 2004, 2003 and 2002, respectively. There was no
interest income recognized on such loans during any of the periods.

      Allowance for Loan Losses.  The amount of the allowance for loan losses is
based on management's  analysis of risks inherent in the various segments of the
loan portfolio,  management's  assessment of known or potential  problem credits
which have come to management's  attention during the ongoing analysis of credit
quality,  historical  loss  experience,  current  economic  conditions and other
factors.   If  actual   circumstances  and  losses  differ   substantially  from
management's  assumptions and estimates,  such allowance for loan losses may not
be sufficient to absorb all future  losses,  and net earnings could be adversely
affected.  Loan loss estimates are reviewed  periodically,  and adjustments,  if
any,  are  reported in earnings  in the period in which they  become  known.  In
addition,  the Company  maintains a portion of the allowance to cover  potential
losses inherent in the portfolio that have not been specifically identified.

      Although management  believes that it uses the best information  available
to make such  determinations  and that the allowance for loan losses is adequate
at December 31, 2004, future adjustments to the allowance may be necessary,  and
net earnings could be affected,  if  circumstances  and/or  economic  conditions
differ   substantially   from  the  assumptions   used  in  making  the  initial
determinations.  A  downturn  in the  southern  and  central  Ohio  economy  and
employment levels could result in the Company  experiencing  increased levels of
nonperforming  assets and charge-offs,  increased provisions for loan losses and
reductions in income. Additionally,  various regulatory agencies, as an integral
part of their examination  process,  periodically review the Company's allowance
for loan losses.  Such agencies may require the  recognition of additions to the
allowance  based on their judgment of information  available to them at the time
of their examination.


                                        7
<PAGE>

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

      The following table summarizes nonperforming assets by category.

<TABLE>
<CAPTION>
===============================================================================================================================
                                                                      Year Ended December 31,
===============================================================================================================================
                                                    2004            2003             2002             2001              2000
===============================================================================================================================
<S>                                              <C>              <C>              <C>              <C>              <C>
(Dollars in thousands)

Real estate:
   Nonaccrual                                    $   3,144        $   2,235        $   1,105        $     386        $     436
   Past due 90 days or more(1)                         121               98              515               40              158
Commercial and industrial:
   Nonaccrual                                        1,858            4,153            4,345            2,813              205
   Past due 90 days or more(1)                         606               21              435              993            1,487
Consumer and other:
   Nonaccrual                                          538            1,213              579              492              422
   Past due 90 days or more(1)                          64              399              317              492              161
===============================================================================================================================
     Total nonperforming loans                       6,331            8,119            7,296            5,216            2,869

Other real estate owned                              1,614              585            1,587              232
===============================================================================================================================
     Total nonperforming assets                  $   7,945        $   8,704        $   7,296        $   6,803        $   3,101
===============================================================================================================================

Loans outstanding                                $ 924,385        $ 821,857        $ 711,086        $ 654,426        $ 606,283
Allowance for loan losses to
   total loans                                        1.28%            1.32%            1.29%            1.28%            1.19%
Nonperforming loans to total loans                    0.69             0.99             1.03             0.80             0.47
Nonperforming assets to total assets                  0.73             0.93             0.88             0.87             0.45
Allowance for loan losses to
   nonperforming loans                               187.1%           133.5%           125.3%           160.0%           250.9%
===============================================================================================================================
</TABLE>

(1)   Represents  accruing loans 90 days or more  delinquent that are considered
      by management to be well secured and in the process of collection.

      As of December 31, 2004, loans where borrowers were experiencing potential
credit  problems  that  raised  doubts as to the ability of those  borrowers  to
comply with the present loan  repayment  terms were included in the  nonaccrual,
past due 90 days or more or restructured categories.

      Allocation of Allowance for Losses on Loans.  The table below  presents an
analysis of the  allocation  of the  Company's  allowance for loan losses at the
dates indicated.

<TABLE>
<CAPTION>
====================================================================================================================================
                                                                    December 31,
====================================================================================================================================
                              2004                 2003                 2002                 2001                 2000
====================================================================================================================================
                                       Percent              Percent               Percent              Percent              Percent
                                      of loans             of loans              of loans             of loans             of loans
                                       in each              in each               in each              in each              in each
                                      category             category              category             category             category
                                      to total             to total              to total             to total             to total
                             Amount   loans(1)    Amount   loans(1)    Amount    loans(1)   Amount    loans(1)   Amount    loans(1)
====================================================================================================================================
                                                               (Dollars in thousands)
<S>                           <C>       <C>      <C>        <C>        <C>         <C>       <C>        <C>       <C>        <C>
Balance at end of period
   applicable to:
1-4 family residential        $   492    29.2%   $   526     28.6%     $  363       34.6%    $2,849      57.0%    $2,506      39.7%
Commercial and other           10,368    63.2      8,793     62.5       5,990       55.1      1,715      33.1      1,508      45.4
Consumer                          925     7.4      1,440      8.7         936       10.1      2,164       9.6      1,903      14.6
Credit cards                       62     0.2         77      0.2          51        0.2         60       0.3         53       0.3
Unallocated                        --      --         --       --       1,802         --      1,557        --      1,227        --
====================================================================================================================================
Total                         $11,847   100.0%   $10,836    100.0%     $9,142      100.0%    $8,345     100.0%    $7,197     100.0%
====================================================================================================================================
</TABLE>

(1) Percentages are base upon loans gross of the allowance for loan losses.


                                        8
<PAGE>

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

      Classified  Assets.  The FDIC  regulations  on  classification  of  assets
require  commercial  banks  to  classify  their  own  assets  and  to  establish
appropriate general and specific allowances for losses,  subject to FDIC review.
These  regulations are designed to encourage  management to evaluate assets on a
case-by-case  basis  and  to  discourage   automatic   classifications.   Assets
classified  as  substandard  or doubtful  must be  evaluated  by  management  to
determine a reasonable  general loss reserve to be included in total capital for
purposes of the Oak Hill's  risk-based  capital  requirement,  but excluded from
core  capital or  tangible  capital or in capital  under  accounting  principles
generally  accepted in the United States of America.  Assets  classified as loss
must be either  written off or reserved for by a specific  allowance that is not
counted  toward   capital  for  purposes  of  any  of  the  regulatory   capital
requirements.

      Investments.   Investment   securities  primarily  satisfy  the  Company's
liquidity needs and provide a return on residual funds after lending activities.
Pursuant to the  Company's  written  investment  policy,  investments  may be in
interest-bearing  deposits,  U.S.  Government  and  agency  obligations,   trust
preferred   securities,    state   and   local   government    obligations   and
government-guaranteed mortgage-backed securities. The Company does not invest in
securities that are rated less than investment grade by a nationally  recognized
statistical rating organization. A goal of the Company's investment policy is to
limit interest rate risk.

      All  securities-related  activity is reported to the Board of Directors of
the  Company.  General  changes in  investment  strategy  must be  reviewed  and
approved by the Company's Board of Directors.  The Company's  senior  management
can purchase and sell securities on behalf of the Company in accordance with the
Company's stated investment policy.

      The  following  table  sets  forth  the  carrying  value of the  Company's
investment  portfolio as indicated and includes both  investments  designated as
available for sale and those designated as held to maturity.

<TABLE>
<CAPTION>
            =================================================================================
                                                                     At December 31,
            =================================================================================
                                                             2004        2003          2002
            =================================================================================
                                                                 (Dollars in thousands)
<S>                                                        <C>          <C>          <C>
            Held-to-maturity:
               Trust preferred securities                  $ 3,640      $ 3,659      $ 2,575

            Available-for-sale:
               U.S. Government and agency obligations       61,408       58,490       64,798
               State and local government obligations       26,769       17,211       16,257
               Other securities                                206          185          159
            =================================================================================
                 Total investment securities
                      available-for-sale                    88,383       75,886       81,214
            =================================================================================
                 Total investment securities               $92,023      $79,545      $83,789
            =================================================================================
</TABLE>

      The following  table reflects the  maturities of the Company's  investment
securities at December 31, 2004.

<TABLE>
<CAPTION>
====================================================================================================================================
                                           Due in       Due after one year    Due after five years
                                    one year or less    through five years     through ten years      Due after ten years
====================================================================================================================================
                                    Amount      Rate     Amount      Rate      Amount      Rate        Amount       Rate      Total
====================================================================================================================================
<S>                                <C>          <C>     <C>          <C>      <C>          <C>        <C>           <C>      <C>
Held-to-maturity:
   Trust preferred securities      $    --        --    $    --        --     $    --        --       $ 3,640       8.45%    $ 3,640

Available-for-sale:
   U.S. Government and
     agency obligations                503      7.13%    11,292      3.81%      8,477      5.12%       41,136       5.73%     61,408
   Municipal obligations               314      5.13%     1,702      4.30%      5,437      4.72%       19,316       4.94%     26,769
   Other securities                     --        --         --        --          --        --           206         --         206
====================================================================================================================================
Total available-for-sale
     securities                        817      6.36%    12,994      3.87%     13,914      4.96%       60,658       5.46%     88,383
====================================================================================================================================
Total investment securities        $   847      6.36%   $12,994      3.87%    $13,914      4.96%      $64,298       5.63%    $92,023
====================================================================================================================================
</TABLE>


                                        9
<PAGE>

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

Source of Funds
---------------

      Deposit Accounts.  Deposits are a major source of the Company's funds. The
Company offers a number of alternatives for depositors  designed to attract both
commercial and regular consumer checking and savings including regular and money
market  savings  accounts,  NOW  accounts,  and  a  variety  of  fixed-maturity,
fixed-rate certificates with maturities ranging from 3 to 60 months. The Company
has also utilized  brokered  deposits as a supplement to its local deposits when
such funds are attractively priced in relation to the local market.

      The distribution of the Company's deposit accounts by type and rate is set
forth in the following table.

<TABLE>
<CAPTION>
==================================================================================================================
                                                                 At December 31,
==================================================================================================================
                                           2004                      2003                      2002
==================================================================================================================
                                    Amount      Percent       Amount      Percent       Amount       Percent
==================================================================================================================
                                                           (Dollars in thousands)
<S>                                <C>           <C>         <C>           <C>         <C>           <C>
Demand deposits                    $ 88,712       10.3%      $ 66,712        9.3%      $ 61,847        9.3%
Savings accounts                     58,978        6.8         48,224        6.7         44,353        6.7
NOW accounts                         65,395        7.6         62,033        8.6         59,359        9.0
Money market deposits                 9,249        1.1          7,644        1.1          7,558        1.1
Premium investment                   53,093        6.1         35,474        4.9         40,604        6.1
Select investment                    27,197        3.2         33,426        4.7         27,896        4.2
==================================================================================================================
   Total transaction accounts       302,624       35.1        253,513       35.3        241,617       36.4

Certificates of deposit:
   1.00 - 2.99%                     344,757       40.0        286,245       39.9         95,377       14.4
   3.00 - 4.99%                     203,406       23.6        162,541       22.6        296,053       44.6
   5.00 - 6.99%                      10,909        1.3         15,447        2.2         30,641        4.6
   7.00 - 8.00%                         400         --             75         --            125         --
==================================================================================================================
   Total certificates of
         deposit                    559,472       64.9        464,308       64.7        422,196       63.6
==================================================================================================================
Total deposits                     $862,096      100.0%      $717,821      100.0%      $663,813      100.0%
==================================================================================================================
</TABLE>

         The following  table  presents  various  interest rate  categories  and
certain  information  concerning  maturities  of the Company's  certificates  of
deposit at December 31, 2004.

<TABLE>
<CAPTION>
==================================================================================================================
                                                              One to                  Over
                                        Within                 three                  three
Certificate of deposit accounts        one year                years                  years               Total
==================================================================================================================
                                                                     (In thousands)
<S>                                    <C>                    <C>                    <C>                <C>
3.00% and less                         $195,856               $204,492               $    648           $400,996
3.01 to 4.00%                            19,428                 27,244                 41,254             87,926
4.01 to 5.00%                            21,390                 24,432                 15,902             61,724
5.01 to 6.00%                             1,055                  2,994                  2,653              6,702
6.01 to 7.00%                             1,156                    647                     --              1,803
7.01 to 8.00%                               314                      7                     --                321
==================================================================================================================
   Total                               $239,199               $259,816               $ 60,457           $559,472
==================================================================================================================
</TABLE>


                                       10
<PAGE>

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

      The following table sets forth the amount of the Company's certificates of
deposit that are $100,000 or greater,  by time remaining until  maturity,  as of
December 31, 2004.

            ============================================================
                    Maturity period                           Amount
            ============================================================
                                                         (In thousands)

            Three months or less                            $ 10,397
            Over three months through six months              30,891
            Over six through twelve months                    43,742
            Over twelve months                               143,059
            ============================================================
              Total                                         $228,089
            ============================================================

      Borrowings.  In addition to deposits and repayment of loan principal,  the
Company  obtains funds  necessary for its lending  activities  and other general
business  purposes  through  loans  (advances)  from the Federal  Home Loan Bank
("FHLB") of Cincinnati.  Advances from the FHLB may be on a secured or unsecured
basis  depending  upon a number of factors,  including the purpose for which the
funds are being  borrowed  and the total of  outstanding  advances.  The Company
typically utilizes FHLB advances to fund loans and to meet short-term  liquidity
needs. As of December 31, 2004, Oak Hill had outstanding FHLB advances  totaling
$105.6  million.  See  Note  F to  the  consolidated  financial  statements  for
additional   information   regarding  FHLB   advances.   The  Company  also  has
arrangements to borrow funds from commercial banks.

      In March 2000,  a Delaware  trust owned by the  Company,  Oak Hill Capital
Trust 1  ("Trust  1"),  issued  $5.0  million  of  mandatorily  redeemable  debt
securities.  The  debt  securities  issued  by the  Trust  are  included  in the
Company's regulatory capital, specifically as a component of Tier I capital. The
subordinated  debentures are the sole assets of the Trust,  and the Company owns
all of the  common  securities  of the  Trust.  Interest  payments  on the  debt
securities  are made  semi-annually  at an annual fixed interest rate of 10.875%
and are reported as a component of interest expense on borrowings.

      During 2004, a Delaware statutory business trust owned by the Company, Oak
Hill Capital Trust 2 ( "Trust 2"), issued $5.0 million of mandatorily redeemable
debt  securities.  The debt  securities  issued by Trust 2 are  included  in the
Company's regulatory capital, specifically as a component of Tier 1 capital. The
proceeds from the issuance of the subordinated  debentures and common securities
were used by Trust 2 to purchase  from the Company $5.0 million of  subordinated
debentures  maturing on October 18, 2034.  The  subordinated  debentures are the
sole  asset of Trust 2, and the  Company  owns all of the common  securities  of
Trust 2. Interest payments on the debt securities are to be made quarterly at an
annual  fixed  rate of  interest  of 6.24%  through  October  18,  2009 and at a
floating rate of interest,  reset  quarterly,  equal to 3-month LIBOR plus 2.40%
thereafter. Interest payments are reported as a component of interest expense on
borrowings.  The net proceeds  received by the Company were  contributed  to the
capital of Oak Hill during 2004.

      On October  1, 2004,  a Delaware  statutory  business  trust  owned by the
Company,  Oak  Hill  Capital  Trust  3  ("Trust  3"),  issued  $8.0  million  of
mandatorily  redeemable debt securities.  The debt securities  issued by Trust 3
are included in the Company's regulatory capital, specifically as a component of
Tier 1 capital.  The proceeds from the issuance of the  subordinated  debentures
and common  securities  were used by Trust 3 to purchase  from the Company  $8.0
million  of   subordinated   debentures   maturing  on  October  18,  2034.  The
subordinated  debentures are the sole asset of Trust 3, and the Company owns all
of the common  securities of Trust 3. Interest  payments on the debt  securities
are to be made quarterly at a floating rate of interest, reset quarterly,  equal
to 3-month  LIBOR plus 2.30%.  Interest  payments are reported as a component of
interest  expense on borrowings.  The net proceeds  received by the Company were
used for merger activity and general corporate activity.


                                       11
<PAGE>

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

      The following  table sets forth the maximum  amount of the Company's  FHLB
advances and other  borrowings  outstanding  at any month end during the periods
shown and the average  aggregate  balances of FHLB advances and other borrowings
for such periods:

<TABLE>
<CAPTION>
            ====================================================================================
                                                               Year Ended December 31,
            ====================================================================================
                                                          2004           2003           2002
            ====================================================================================
                                                                (Dollars in thousands)
<S>                                                     <C>            <C>            <C>
            Maximum amount outstanding:

              FHLB advances                             $119,520       $134,030       $ 99,346
              Junior subordinated debentures              18,000          5,000          5,000
              Other borrowings                             9,277          8,346          8,303
            ====================================================================================
                Total                                   $146,797       $147,376       $112,649
            ====================================================================================
            Average amount of FHLB advances
              and other borrowings outstanding          $124,514       $117,328       $101,818
            ====================================================================================
            Weighted-average interest rate of
              total borrowings                              4.28%          3.63%          4.85%
            ====================================================================================
</TABLE>

      The  following  table sets forth certain  information  as to the Company's
FHLB advances and other borrowings at the dates indicated.

<TABLE>
<CAPTION>
            ====================================================================================
                                                               Year Ended December 31,
            ====================================================================================
                                                          2004           2003           2002
            ====================================================================================
                                                                    (In thousands)
<S>                                                     <C>            <C>            <C>
            FHLB advances                               $105,601       $122,887       $ 86,055
            Junior subordinated debentures                18,000          5,000          5,000
            Other borrowings                               8,059          7,465          8,303
            ====================================================================================
                Total borrowings                        $131,660       $135,352       $ 99,358
            ====================================================================================
</TABLE>

      Asset and  Liability  Management.  The  Company  manages  its  exposure to
interest rate risk through its Asset/Liability  Management  Committees (ALCO) at
both  the  Company  and  Oak  Hill  levels.   Given  the  potential   types  and
characteristics  of interest  rate risk,  the Company  maintains an  appropriate
process and set of  measurement  tools to enable it to identify and quantify its
primary  sources of  interest  rate  risk.  The  Company  also  recognizes  that
effective  management of interest rate risk includes  understanding when and how
potential  changes in interest  rates will flow through the earnings  statement.
Accordingly,  the  Company  manages its  position  so that it monitors  both its
short-term and long-term  interest rate risk exposure.  Tools used by management
include  an  interest  rate  sensitivity  gap  analysis  and  an  interest  rate
simulation  model whereby changes in net interest income are measured based upon
selected hypothetical changes in market interest rates.

      Net interest income, the difference between the yield on  interest-earning
assets and the cost of interest-bearing  liabilities, is the principal component
of the Company's net  earnings.  The ability to maximize net interest  income is
largely  dependent upon the achievement of a positive  interest rate spread that
can be sustained during  fluctuations in prevailing interest rate levels. Due to
the maturity,  repricing and timing differences between  interest-earning assets
and  interest-bearing  liabilities,  the  Company's  earnings  would be affected
differently under various interest rate scenarios.  Interest rate sensitivity is
a measure  of the  difference  between  amounts of  interest-earning  assets and
interest-bearing  liabilities  which reprice  within a given period of time. The
difference,  or the interest rate repricing "gap", provides an indication of the
extent to which an interest  rate spread will be affected by changes in interest
rates. A gap is considered  positive when the amount of interest-rate  sensitive
assets  exceeds  the  amount  of  interest-rate  sensitive  liabilities  and  is
considered  negative  when the  amount of  interest-rate  sensitive  liabilities
exceeds the amount of interest-rate sensitive assets. Generally, during a period
of rising  interest-rates,  a  negative  gap  within  shorter  maturities  would
adversely  affect  net  interest  income,  while a positive  gap within  shorter
maturities  would  result in an increase  in net  interest  income.  Conversely,
during a period of  falling  interest  rates,  a  negative  gap  within  shorter
maturities would result in an increase in net interest income,  while a positive
gap within shorter maturities would have the opposite effect.


                                       12
<PAGE>

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

      The following table contains information  regarding the amounts of various
categories of assets and liabilities  contractually repricing within the periods
indicated without consideration of loan prepayment  assumptions or deposit decay
assumptions:

<TABLE>
<CAPTION>
====================================================================================================================================
December 31, 2004                                                    Year Ending December 31,
====================================================================================================================================
                                                 2005            2006            2007            2008   2009 and after        Total
====================================================================================================================================
<S>                                        <C>             <C>             <C>             <C>                           <C>
Interest-rate sensitive assets:
   Federal funds sold                      $      988      $       --      $       --      $       --             --     $      988
   Interest-bearing deposits                    1,374                             343                                         1,717
   Investment securities                       21,358          13,990          15,633          11,692         29,350         92,023
   Loans receivable                           420,620         127,625         139,581          95,184        129,528        912,538
   Other interest-earning assets                  187              --              --              --         16,708         16,895
====================================================================================================================================
     Total                                    444,527         141,615         155,557         106,876        175,586      1,024,161

Interest-rate sensitive liabilities:
   Deposits                                   576,654         105,643          30,290          46,896         13,901        773,384
   Borrowings                                  63,531           6,544           6,745           1,061         53,779        131,660
====================================================================================================================================
     Total                                    640,185         112,187          37,035          47,957         67,680        905,044
====================================================================================================================================
Excess (deficiency) of interest-rate
   sensitive assets over interest-rate
   sensitive liabilities                   $ (195,658)     $   29,428      $  118,522      $   58,919     $  107,906     $  119,117
====================================================================================================================================
Cumulative excess (deficiency) of
   interest-rate sensitive assets
   over interest-rate sensitive
   liabilities                             $ (195,658)     $ (166,230)     $  (47,708)     $   11,211     $  119,117     $  119,117
====================================================================================================================================
Cumulative interest-rate sensitivity
   gap to total assets                         (18.07)%        (15.35)%         (4.41)%          1.04%         10.98%         10.98%
====================================================================================================================================

<CAPTION>
====================================================================================================================================
December 31, 2003                                                         Year Ending December 31,
====================================================================================================================================
                                                 2004            2005            2006            2007   2008 and after        Total
====================================================================================================================================
<S>                                        <C>             <C>             <C>             <C>            <C>            <C>
Interest-rate sensitive assets:
   Federal funds sold                      $      123      $       --      $       --      $       --     $       --     $      123
   Interest-bearing deposits                    1,162              --              --              --             --          1,162
   Investment securities                       20,904          11,222          11,813           7,467         28,139         79,545
   Loans receivable                           355,313          77,896         117,575          97,255        162,982        811,021
   Other interest-earning assets                   --              --              --              --          5,998          5,998
====================================================================================================================================
Total                                         377,502          89,118         129,388         104,722        197,119        897,849

Interest-rate sensitive liabilities:
   Deposits                                   440,734         127,304          31,345          20,334         31,392        651,109
   Borrowings                                  53,832          13,190           7,059           6,743         54,528        135,352
====================================================================================================================================
     Total                                    494,566         140,494          38,404          27,077         85,920        786,461
====================================================================================================================================
Excess (deficiency) of interest-rate
   sensitive assets over interest-rate
   sensitive liabilities                   $ (117,064)     $  (51,376)     $   90,984      $   77,645     $  111,199     $  111,388
====================================================================================================================================
Cumulative excess (deficiency) of
   interest-rate sensitive assets
   over interest-rate sensitive
   liabilities                             $ (117,064)     $ (168,440)     $  (77,456)     $      189     $  111,388     $  111,388
====================================================================================================================================
Cumulative interest-rate sensitivity
   gap to total assets                         (12.48)%        (17.95)%         (8.26)%          0.02%         11.87%         11.87%
====================================================================================================================================
</TABLE>


                                       13
<PAGE>

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

      Due to the  shortcomings  associated  with  gap  analysis,  the  Company's
primary tool in managing interest rate risk is net interest income  simulations,
which measure the potential effect on earnings that  instantaneous  parallel and
proportional  changes in interest  rates could have on net interest  income over
defined periods of time. The Company applies  hypothetical  interest rate shocks
of up and down 100, 200 and 300 basis points (100 basis points equals 1%) to its
financial  instruments based upon assumed cash flows. Under the current interest
rate  environment,  a decline in interest  rates of 200 or more basis  points is
unlikely and therefore provides no meaningful information.

      The parallel  approach to interest  rate shocks  assumes that all interest
rates will simultaneously move up or down by like amounts. This approach is very
simplistic  and could be viewed as a "worst  case"  scenario.  The  proportional
approach to interest rate shocks  assumes that the interest  rates for financial
instruments  change in  proportion  to a single  driver  rate.  The  Company has
selected  the  national  Prime  rate as its  driver  rate.  In the  proportional
approach,  the driver rate shock is multiplied by the proportional  rate factors
for each financial instrument to obtain the new interest rates used to calculate
projected net interest income changes.

      The following table reflects,  as of December 31, 2004,  projected changes
in the  Company's  twelve-month  net  interest  income  as a  percentage  of net
interest income assuming parallel and proportional interest rate shocks.

<TABLE>
<CAPTION>
            ======================================================================================
                                                Rate Shock Analysis
            ======================================================================================
                                         ALCO Limit           Parallel              Proportional
                Twelve-Month            Twelve-Month          Interest                Interest
             Net Interest Income        Net Interest            Rate                    Rate
                   Changes             Income Changes           Shock                   shock
            ======================================================================================
<S>                                         <C>                <C>                     <C>
              +300 basis points             -30%               -7.378%                 17.963%
              +200 basis points             -20%               -4.362%                 12.751%
              +100 basis points             -15%               -1.992%                  6.646%
              -100 basis points             -15%                0.710%                 -6.463%
            ======================================================================================
</TABLE>

      As with any method of measuring interest rate risk,  certain  shortcomings
are  inherent  in  the  analysis.  For  example,  although  certain  assets  and
liabilities may have similar maturities or periods of repricing,  they may react
differently  to changes in market  interest  rates.  Also, the interest rates on
certain types of assets and  liabilities  may fluctuate in advance of changes in
market  interest  rates,  while  interest  rates on other  types of  assets  and
liabilities  may lag behind changes in market  interest rates. In the event of a
change in market  interest  rates,  expected  rates of  prepayment  on loans and
mortgage-backed  securities,  and early withdrawal  levels from  certificates of
deposit,  would likely  deviate from those  assumed in making the interest  rate
risk calculations.  Moreover,  the analysis does not contemplate all actions the
Company  may take in  response  to changes in  interest  rates and should not be
relied upon as being indicative of actual results.


                                       14
<PAGE>

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

Personnel
---------

      At  December  31,  2004,  the Company and its  subsidiaries  employed  402
persons on a full-time basis and 58 persons on a part-time basis.

Executive Offices
-----------------

      The  Company's  executive  office  is  located  at 14621  State  Route 93,
Jackson, Ohio 45640 and its telephone number is (740) 286-3283.

Subsidiaries
------------

      The Company owns all of the  outstanding  stock of Oak Hill Banks, an Ohio
state-chartered  bank,  which was founded in 1902.  The Company  owns all of the
outstanding  stock of Oak Hill Capital Trust 1, a Delaware  statutory trust that
was formed in 2000.  The Company owns all of the  outstanding  stock of Oak Hill
Capital  Trust 2 and Oak Hill Capital Trust 3,  Delaware  statutory  trusts that
were formed in 2004. The Company owns all of the  outstanding  stock of Oak Hill
Financial Insurance Agency, Inc., which conducts business as MPA Group Insurance
Specialists,  a group health insurance and employee  benefits agency acquired in
August 2001. In addition,  the Company has a 49% ownership  interest in Oak Hill
Title  Agency,  LLC,  a limited  liability  company  that was formed in 2001 and
commenced  operations in January 2002 to provide title  services for  commercial
and residential real estate transactions.

Regulation
----------

      Oak Hill, as an Ohio  state-chartered  bank, is subject to supervision and
regular examination by the Superintendent of Financial Institutions of the State
of Ohio. Oak Hill is insured by the Federal Deposit Insurance Corporation and is
subject to the  provisions of the Federal  Deposit  Insurance Act. To the extent
that the  information  below  consists  of  summaries  of  certain  statutes  or
regulations,  it is qualified  in its entirety by reference to the  statutory or
regulatory provisions described.

      The Company is subject to the  provisions of the Bank Holding  Company Act
of 1956,  as amended  (the  "Act"),  which  requires a bank  holding  company to
register under the Act and to be subject to supervision  and  examination by the
Board of  Governors of the Federal  Reserve  System.  A bank holding  company is
required  to file  with  the  Board  of  Governors  an  annual  report  and such
additional  information  as the Board of Governors  may require  pursuant to the
Act.  The  Act  requires  prior  approval  by  the  Board  of  Governors  of the
acquisition by a bank holding company,  or any subsidiary thereof, of 5% or more
of the  voting  stock or  substantially  all the  assets of any bank  within the
United States.

      A bank holding  company  located in the State of Ohio is not  permitted to
acquire a bank or other  financial  institution  located in another state unless
such  acquisition is specifically  authorized by the statutes of such state. The
Act  further  provides  that the Board of  Governors  shall not approve any such
acquisition  that would result in a monopoly or would be in  furtherance  of any
combination or conspiracy to monopolize or attempt to monopolize the business of
banking  in any part of the  United  States,  or the  effect  of which may be to
substantially  lessen  competition or to create a monopoly in any section of the
country,  or that in any other manner would be in restraint of trade, unless the
anti-competitive  effects of the proposed  transaction are clearly outweighed in
the public  interest by the probable  effect of the  transaction  in meeting the
convenience and needs of the community to be served.

      The Act also prohibits a bank holding  company,  with certain  exceptions,
from  acquiring 5% or more of the voting stock of any company that is not a bank
and from engaging in any business other than banking or performing  services for
its banking  subsidiary  without  the  approval  of the Board of  Governors.  In
addition, the acquisition of a thrift institution must be approved by the Office
of  Thrift  Supervision  pursuant  to  the  savings  and  loan  holding  company
provisions  of the Home  Owners'  Loan  Act of 1933.  On  March  13,  2000,  the
Financial Services Act of 1999, also known as the Gramm-Leach-Bliley Act, became
effective.   This  legislation  repealed  certain   cross-industry   affiliation
prohibitions and made certain other changes to the Act. It authorized a new form
of holding company,  a financial holding company,  which with certain exceptions
is authorized to undertake  activities which are "financial in nature" and which
include banking,  insurance and securities activities.  Generally,  the scope of
activities  permitted  to a financial  holding  company  are broader  than those
previously permitted to a bank holding company. A bank holding company may elect
to become a financial  holding  company.  The Company made this election and was
notified on July 11, 2001 by the Federal Reserve Bank that its election had been
approved.  Under the Act, as amended by the Gramm-Leach-Bliley  Act, the Company
is  permitted  to engage in  certain  activities,  including  mortgage  banking,
operating small loan companies,  factoring,  furnishing  certain data processing
operations,  holding or operating  properties  used by banking  subsidiaries  or
acquired for such future use, providing certain investment and financial advice,
leasing  (subject to certain  conditions) real or personal  property,  providing
management  consulting  advice to  certain  depository  institutions,  providing
securities   brokerage  services,   arranging   commercial  real  estate  equity
financing,  underwriting and dealing in government  obligations and money market
instruments,  providing  consumer financial  counseling,  operating a collection
agency,  owning and operating a savings  association,  operating a credit bureau
and conducting certain real estate investment activities and acting as insurance
agent for certain types of insurance.  Certain other activities,  including real
estate brokerage and syndication,


                                       15
<PAGE>

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

land development, and property management not related to credit transactions,
are not permissible.

      The Act and the regulations of the Board of Governors prohibit a financial
holding   company  and  its   subsidiaries   from  engaging  in  certain  tie-in
arrangements  in  connection  with any  extension  of  credit,  lease or sale of
property, or furnishing of services.

      The Act also imposes certain restrictions upon dealing by affiliated banks
with  the  holding  company  and  among  themselves  including  restrictions  on
interbank   borrowing  and  upon  dealings  in  respect  to  the  securities  or
obligations of the holding company or other affiliates.

      On October 26, 2001 President Bush signed the USA Patriot Act of 2001 (the
"Patriot Act"). Enacted in response to the September 11, 2001 terrorist attacks,
the Patriot Act is intended to strengthen the ability of various agencies of the
United States to work cohesively to combat terrorism on a variety of fronts. The
potential  impact of the Patriot Act on financial  institutions  of all kinds is
significant  and wide  ranging.  The Patriot Act  contains  sweeping  anti-money
laundering and financial  transparency  laws and requires  various  regulations,
including:

      o     Due  diligence   requirements   for  financial   institutions   that
            administer,   maintain,   or  manage   private   bank   accounts  or
            correspondent accounts for non-U.S. persons;

      o     Standards for verifying customer identification at account opening;

      o     Rules  to  promote   cooperation   among   financial   institutions,
            regulators, and law enforcement entities in identifying parties that
            may be involved in terrorism or money laundering;

      o     Reports  by  non-financial  trades  and  businesses  filed  with the
            Treasury  Department's  Financial  Crimes  Enforcement  Network  for
            transactions exceeding $10,000 and;

      o     Filing of suspicious activities reports for securities  transactions
            by brokers and dealers if they  believe a customer  may be violating
            U.S. laws and regulations.

      On July 30, 2002, President Bush signed into law the Sarbanes-Oxley Act of
2002 (the "Sarbanes-Oxley  Act"). The stated goals of the Sarbanes-Oxley Act are
to increase  corporate  responsibility,  to provide for enhanced  penalties  for
accounting  and  auditing  improprieties  at publicly  traded  companies  and to
protect  investors  by  improving  the  accuracy  and  reliability  of corporate
disclosures  made pursuant to the  securities  laws. The changes are intended to
allow  shareholders  to monitor the  performance of companies and directors more
easily  and  efficiently.  The  Sarbanes-Oxley  Act  generally  applies  to  all
companies,  both U.S. and  non-U.S.,  that file or are required to file periodic
reports with the SEC under the Exchange Act.

      The Sarbanes-Oxley Act addresses,  among other matters:  audit committees;
auditor  independence;   analysts'  conflicts  of  interest;   certification  of
financial  statements  by the chief  executive  officer and the chief  financial
officer;  the  forfeiture  of bonuses and profits made by  directors  and senior
officers in the twelve month period covered by restated financial statements;  a
prohibition on insider trading during pension plan black-out periods; disclosure
of off-balance sheet transactions;  a prohibition on personal loans to directors
and officers  (excluding  Federally insured financial  institutions);  expedited
filing requirements for stock transaction reports by officers and directors; the
formation of a public accounting oversight board; and various increased criminal
penalties for violations of securities laws.

      In 2002 and 2003, the SEC adopted a host of new  regulations  implementing
the provisions of the  Sarbanes-Oxley  Act. These new regulations may change the
manner in which the Company is required to report its  financial  condition  and
results of  operations in the future.  The Company  believes that it has been at
all times in material compliance with these regulations;  however,  there can be
no assurance that future regulations,  implementing the Sarbanes-Oxley Act, will
not have an adverse  effect on the Company's  reported  financial  condition and
results of operations as compared with prior reporting periods.

      Management  has  instituted a series of actions to strengthen  and improve
the Company's already strong corporate governance  practices.  Included in those
actions was the formation of a Disclosure Controls and Procedures  Committee for
financial  reporting (the "Disclosure  Committee"),  to evaluate and monitor the
continued  effectiveness of the design and operation of disclosure  controls for
financial reporting. The Disclosure Committee complements the Company's existing
committee  structure and process and is designed to capture critical  management
information  and disclosures  from the Company and each of its  affiliates.  The
Company  believes  that the addition of the  Disclosure  Committee  enhances its
already effective disclosure processes.

      The earnings of banks and consumer  finance  companies,  and therefore the
earnings of the Company (and its subsidiaries),  are affected by the policies of
regulatory authorities,  including the Board of Governors of the Federal Reserve
System.  An important  function of the Federal  Reserve Board is to regulate the
national supply of bank credit in an effort to prevent recession and to restrain


                                       16
<PAGE>

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

inflation.  Among the  procedures  used to implement  these  objectives are open
market operations in U.S. Government securities, changes in the discount rate on
member bank borrowings,  and changes in reserve requirements against member bank
deposits. These procedures are used in varying combinations to influence overall
growth and distribution of bank loans,  investments and deposits,  and their use
also may affect  interest rates charged on loans or paid for deposits.  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 do so in the future.  The effect,  if any, of such  policies  upon the future
business and earnings of the Company cannot accurately be predicted. The Company
makes no attempt to predict the effect on its  revenues  and earnings of changes
in general economic,  industrial, and international conditions or in legislation
and governmental  regulations.  The Company is not able to predict the impact of
such laws or governmental  regulations on its financial  condition or results of
operations at this time.

Business Risks
--------------

      Except  for the  historical  information  contained  herein,  the  matters
discussed in this Form 10-K include certain  forward-looking  statements  within
the  meaning  of  Section  27A of the  Securities  Act  and  Section  21E of the
Securities  Exchange Act of 1934,  as amended (the  "Exchange  Act"),  which are
intended to be covered by the safe harbors  created  thereby.  Those  statements
include, but may not be limited to, all statements regarding the intent,  belief
and  expectations  of  the  Company  and  its  management,  such  as  statements
concerning the Company's future profitability.  Investors are cautioned that all
forward-looking  statements involve risks and uncertainties  including,  without
limitation, factors detailed from time to time in the Company's filings with the
SEC.  Although  the  Company  believes  that  the  assumptions   underlying  the
forward-looking   statements  contained  herein  are  reasonable,   any  of  the
assumptions could be inaccurate.  Therefore,  there can be no assurance that the
forward-looking statements included in this Form 10-K will prove to be accurate,
and in light of the significant  uncertainties  inherent in the  forward-looking
statements  included  herein,  the inclusion of such  information  should not be
regarded  as a  presentation  by  the  Company  or any  other  person  that  the
objectives and plans of the Company will be achieved.

      Growth  Strategy.  The  Company  has  pursued  and  continues  to pursue a
strategy of growth.  The success of the  Company's  growth  strategy will depend
largely  upon its  ability to manage its credit risk and control its costs while
providing  competitive  products and services.  This growth strategy may present
special  risks,  such as the risk that the Company will not  efficiently  handle
growth  with its  present  operations,  the risk of  dilution  of book value and
earnings per share as a result of an acquisition, the risk that earnings will be
adversely  affected by the  start-up  costs  associated  with  establishing  new
products and services, the risk that the Company will not be able to attract and
retain qualified personnel needed for expanded operations, and the risk that its
internal monitoring and control systems may prove inadequate.

      Control by Management;  Anti-Takeover  Provisions.  Evan E. Davis, John D.
Kidd and D. Bruce Knox (the "Principal  Stockholders")  beneficially  own in the
aggregate  approximately  21.8% of the outstanding shares of Common Stock of the
Company  at  December  31,  2004.  In  addition  to Ohio  and  federal  laws and
regulations governing changes in control of insured depository institutions, the
Company's  Articles of  Incorporation  and Code of Regulations  contain  certain
provisions  that may delay or make more  difficult an  acquisition of control of
the Company.  For example, the Company's Articles of Incorporation do not exempt
the Company  from the  provisions  of Ohio's  "control  share  acquisition"  and
"merger moratorium" statutes.  Assuming that the Principal Stockholders continue
to retain the number of the  outstanding  voting shares of the Company that they
presently  own and the law of Ohio  requires,  as it  presently  does,  at least
two-thirds  majority vote of the outstanding shares to approve a merger or other
consolidation, unless the articles of incorporation of the constituent companies
provide for a lower approval percentage for the transaction, which the Company's
articles do not provide,  such ownership position could be expected to deter any
prospective  acquirer  from  seeking  to  acquire  ownership  or  control of the
Company, and the Principal  Stockholders would be able to defeat any acquisition
proposal that requires approval of the Company's stockholders,  if the Principal
Stockholders chose to do so. In addition,  the Principal Stockholders may make a
private sale of shares of common  stock of the Company that they own,  including
to a person seeking to acquire ownership or control of the Company.  The Company
has 3,000,000 shares of authorized but unissued preferred stock, par value $ .01
per share,  which may be issued in the future with such rights,  privileges  and
preferences  as are  determined  by the Board of Directors  of the  Company.  In
December  1997,  the Board of  Directors  of the Company  approved and adopted a
stockholder  rights plan that  contemplates  the  issuance of rights to purchase
preferred stock of the Company to the Company's common stockholders of record as
of February 17, 1998, as set forth in the Rights Agreement  entered into between
the Company and Fifth Third Bank on January 23, 1998. On December 26, 2000,  the
Company amended the Rights  Agreement to appoint  Registrar and Transfer Company
as successor  Rights Agent under the Rights  Agreement due to the resignation of
Fifth Third Bank as Rights Agent. The Board of Directors of the Company approved
the appointment of Registrar and Transfer Company pursuant to a resolution dated
November  14,  2000.  John D. Kidd and Evan E.  Davis also have  entered  into a
Buy-Sell Agreement dated April 11, 2001 (the "Agreement"),  whereby in the event
of either one's death, the survivor shall have the right to purchase some or all
of the shares of the Company held by the deceased's  estate.  In connection with
the  Agreement,  Mr. Kidd and Mr.  Davis each have  executed a Limited  Power of
Attorney  giving the other sole right,  power and  authority  to vote all of the
shares of the Company that he holds in the event of his incapacity.

      Limited  Trading  Market;   Shares  Eligible  for  Future  Sale;  Possible
Volatility  of Stock Price.  The Common  Stock is traded on the Nasdaq  National
Market under the symbol  "OAKF." During the 12 months ending March 11, 2005, the
average weekly trading volume in the Common Stock has been approximately  59,000
shares per week. There can be no assurance given as to the


                                       17
<PAGE>

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

liquidity of the market for the Common Stock or the price at which any sales may
occur,  which price will depend upon, among other things,  the number of holders
thereof,  the  interest of  securities  dealers in  maintaining  a market in the
Common Stock and other  factors  beyond the control of the  Company.  The market
price of the Common Stock could be adversely  affected by the sale of additional
shares  of  Common  Stock  owned  by the  Company's  current  shareholders.  The
Principal  Shareholders  are permitted to sell certain limited amounts of Common
Stock without  registration,  pursuant to Rule 144 under the Securities Act. The
market price for the Common Stock could be subject to  significant  fluctuations
in response to  variations in quarterly and yearly  operating  results,  general
trends in the banking industry and other factors. In addition,  the stock market
can  experience  price  and  volume   fluctuations  that  may  be  unrelated  or
disproportionate to the operating performance of affected companies. These broad
fluctuations may adversely affect the market price of the Common Stock.

      Dependence on Management.  The Company's success depends to a great extent
on its senior management,  including its Chairman,  John D. Kidd;  President and
Chief Executive Officer, R. E. Coffman,  Jr.; Executive Vice President and Chief
Administrative  Officer,  David G. Ratz; Vice President,  Scott J. Hinsch,  Jr.;
Executive Vice President,  Chief Financial Officer, Secretary and Treasurer, Ron
J. Copher; and Executive Vice President and Chief Information  Officer, D. Bruce
Knox. The loss of their individual services could have a material adverse impact
on the  Company's  financial  stability  and its  operations.  In addition,  the
Company's  future  performance  depends on its ability to attract and retain key
personnel and skilled  employees,  particularly at the senior  management level.
The Company's financial stability and its operations could be adversely affected
if, for any reason,  one or more key executive  officers  ceased to be active in
the Company's  management.  The Company does not own "key man" life insurance on
the lives of any of its senior management.

      Competition.   Banking   institutions  operate  in  a  highly  competitive
environment.  The Company competes with other commercial  banks,  credit unions,
savings institutions,  finance companies,  mortgage companies, mutual funds, and
other financial institutions, many of which have substantially greater financial
resources  than the Company.  Certain of these  competitors  offer  products and
services  that are not offered by the Company  and certain  competitors  are not
subject to the same extensive laws and regulations as the Company. Additionally,
consolidation of the financial  services  industry in Ohio and in the Midwest in
recent  years  has  increased  the level of  competition.  Recent  and  proposed
regulatory  changes may further  intensify  competition in the Company's  market
area.

      Holding  Company  Structure;  Government  Regulations  and  Policies.  The
Company is a financial holding company, which is substantially  dependent on the
profitability of its subsidiaries and the upstream payment of dividends from Oak
Hill to the  Company.  Under  state and  federal  banking  law,  the  payment of
dividends  by  the  Company  and  Oak  Hill  are  subject  to  capital  adequacy
requirements.  The  inability  of Oak  Hill to  generate  profits  and pay  such
dividends  to the  Company,  or  regulator  restrictions  on the payment of such
dividends  to the Company  even if earned,  would have an adverse  effect on the
financial  condition  and results of operations of the Company and the Company's
ability to pay dividends to the shareholders.

Item 2. Properties.

      As of December 31, 2004 the registrant and its  subsidiaries  operate from
30  full-service  banking  offices and __ loan  production  offices in Ohio.  In
addition,  the Company  operates two executive  offices in Jackson,  Ohio and an
operations  center in Mason,  Ohio.  The offices  are  located in the  following
counties:

<TABLE>
<CAPTION>
              ===================================================================================
                                                     Subsidiaries
              ===================================================================================
                                  Oak Hill         Oak Hill                       Oak Hill
              County           Financial, Inc.       Banks          MPA       Title Agency, LLC
              ===================================================================================
<S>                                  <C>               <C>           <C>              <C>
              Athens                --                 2            --                --
              Brown                 --                 2            --                --
              Butler                --                 3            --                --
              Franklin              --                 2            --                --
              Gallia                --                 1            --                --
              Hamilton              --                 3            --                --
              Hocking               --                 1            --                --
              Jackson(1)             1                 6             1                --
              Montgomery            --                 1            --                --
              Lawrence              --                 1            --                --
              Pickaway              --                 1            --                --
              Ross                  --                 4            --                --
              Scioto                --                 4            --                 1
              Vinton                --                 1            --                --
              Warren(2)             --                 3            --                --
              ===================================================================================
</TABLE>

            (1)   Includes executive offices of Oak Hill Financial, Inc. and Oak
                  Hill Banks

            (2)   Includes operations center of Oak Hill Banks.


                                       18
<PAGE>

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

      The following  table indicates  which  properties the Company leases,  the
term of the lease and end of lease  options.  All leases are comparable to other
leases in the respective market areas and do not contain provisions  detrimental
to the Company or its subsidiaries.

<TABLE>
<CAPTION>
===========================================================================================================================
                                                                                End of Lease Five Year Renewal Options
                                                                     ======================================================
                                                Beginning
                                           and Length of Term        One                    Two                    Three
===========================================================================================================================
<S>                                        <C>                                <C>                                    <C>
Chillicothe                                02/01/93 5 years                                                          X
Chillicothe K-Mart                         06/28/94 15 years                        No renewal options
West Portsmouth                            02/18/97 8 years                                                          X
Jackson Walmart                            10/28/98 5 years                                  X
Oak Hill Banks Administrative Offices      09/15/04 4 years                   Three - 3-year renewal options
Columbus loan production                   04/01/04 2 years                         No renewal options
Logan                                      10/1/00  5 years                                                          X
Delhi                                      03/01/97 10 years                                 X
Middletown                                 08/19/99 5 years                                  X
Oak Hill Title Agency, LLC                 10/01/01 5 years                         No renewal options
Fairfield loan production                  05/20/02 2 years                    Two - 1-year renewal options
Centerville                                12/19/03 10 years                                 X
Athens loan production                     12/11/01 40 months                  Two - 3-year renewal options
Mason                                      06/01/02 5 years                                  X
MPA                                        12/01/02 5 years                                  X
===========================================================================================================================
</TABLE>

Item 3. Legal Proceedings.

      Except for routine litigation  incident to their business,  the registrant
and its subsidiaries  are not a party to any material pending legal  proceedings
and none of their property is the subject of any such proceedings.

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

      No matters were submitted to the shareholders during the fourth quarter of
2004.


                                       19
<PAGE>

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

                                     PART II

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

SHAREHOLDER INFORMATION

      The common  stock of the Company is traded on the Nasdaq  National  Market
System under the symbol "OAKF."

      The high and low sales  prices for the Company  common  stock  during each
quarter of 2004 and 2003 are as follows:

Quarter
 Ended                 High            Low

12/31/04              $39.25         $34.54
09/30/04               35.49          31.40
06/30/04               33.00          30.86
03/31/04               34.00          30.10
12/31/03               33.80          28.40
09/30/03               30.00          24.90
06/30/03               25.90          23.52
03/31/03               24.77          21.23

      At March 18, 2005 the Company had  approximately  2,400  stockholders  and
5,577,903 shares of common stock outstanding.

      Dividends.   The  ability  of  the  Company  to  pay  cash   dividends  to
stockholders is limited by its ability to receive dividends from its subsidiary.
The State of Ohio places certain limitations on the payment of dividends by Ohio
state-chartered banks.

      The Company declared the following dividends per share in 2004 and 2003:

Quarter                    Dividend
 Ended                     Declared
 -----                     --------

12/31/04                    $0.17
09/30/04                     0.15
06/30/04                     0.15
03/31/04                     0.15
12/31/03                     0.15
09/30/03                     0.13
06/30/03                     0.13
03/31/03                     0.13

      Future  cash and stock  dividends  will be  subject to  determination  and
declaration by the Board of Directors of the Company, taking into consideration,
among  other  factors,   the  Company's   financial  condition  and  results  of
operations,  investment  opportunities,  capital  requirements,  and  regulatory
limitations.

      Stock Transfer Agent.  Inquiries  regarding stock transfer,  registration,
lost certificates,  or changes in name and address should be directed in writing
to the Company's stock transfer agent:

      The Registrar and Transfer Company 10 Commerce Drive Cranford, NJ
07016-3572 (800) 456-0596

      Annual Meeting of Shareholders. The Annual Meeting of Shareholders of Oak
Hill Financial, Inc. will be held on April 12, 2005 at 1:00 p.m. at the Ohio
State University Extension South District Office, 17 Standpipe Road, Jackson,
Ohio.


                                       20
<PAGE>

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

Item 6. Selected Financial Data

<TABLE>
<CAPTION>
                                                                        At or For the Year Ended December 31,
====================================================================================================================================
                                                         2004             2003             2002            2001            2000
====================================================================================================================================
                                                                           (In thousands, except share data)
<S>                                                  <C>               <C>              <C>            <C>              <C>
SUMMARY OF FINANCIAL CONDITION (1)(2)
Total assets                                         $ 1,083,040       $   938,281      $ 833,629      $   778,332      $ 694,905
Interest-bearing deposits and federal funds sold           2,705             1,285          5,699           11,929            442
Investment securities                                     92,023            79,545         83,789           78,981         61,427
Loans receivable - net (3)                               912,538           811,021        701,944          646,081        599,086
Deposits                                                 862,096           717,821        663,813          612,204        562,414
Federal Home Loan Bank (FHLB) advances
     and other borrowings                                131,660           135,352         99,358          104,860         77,595
Stockholders' equity                                      85,043            79,928         66,881           56,349         50,224

SUMMARY OF OPERATIONS (1)(2)
Interest income                                      $    59,251       $    55,170      $  57,222      $    59,704      $  54,579
Interest expense                                          20,838            20,468         24,724           30,777         29,505
====================================================================================================================================
     Net interest income                                  38,413            34,702         32,498           28,927         25,074
Provision for losses on loans                              3,136             3,347          2,757            2,591          2,263
====================================================================================================================================
     Net interest income after provision for
          losses on loans                                 35,277            31,355         29,741           26,336         22,811
Gain on sale of loans                                      1,882             4,489          2,358            1,385            174
Gain on sale of branch                                        --                --            122              900             --
Gain (loss) on sale of assets                                (47)              333            331               27           (328)
Insurance commissions                                      3,050             2,827          2,457            2,203          2,090
Loss on sale of consumer finance loan portfolio
     and related assets                                   (3,585)               --             --               --             --
Other income                                               5,370             3,889          2,845            2,676          2,498
General, administrative and other expense (4)             26,944            24,049         22,663           20,672         17,734
====================================================================================================================================
     Earnings before federal income tax                   15,003            18,844         15,191           12,855          9,511
Federal income taxes                                       4,341             6,266          4,851            4,133          3,174
====================================================================================================================================
Net earnings                                         $    10,662       $    12,578      $  10,340      $     8,722      $   6,337
====================================================================================================================================

PER SHARE INFORMATION (5)
Basic earnings per share                             $      1.92       $      2.29      $    1.94      $      1.66      $    1.17
Book value per share                                 $     15.30       $     14.34      $   12.46      $     10.70      $    9.51
====================================================================================================================================

<CAPTION>
====================================================================================================================================
                                                                           At or For the Year Ended December 31,
====================================================================================================================================
                                                            2004              2003          2002             2001           2000
====================================================================================================================================
<S>                                                       <C>               <C>            <C>              <C>            <C>
OTHER STATISTICAL AND OPERATING DATA
Return on average assets                                    1.07%             1.45%          1.26%            1.20%          0.99%
Return on average equity                                   12.89             17.08          16.76            16.45          12.98
Net interest margin (fully-taxable equivalent)              4.05              4.19           4.18             4.17           4.06
Interest rate spread during period                          3.74              3.81           3.75             3.56           3.40
General, administrative and other expense
     to average assets                                      2.70              2.77           2.77             2.85           2.76
Allowance for loan losses to nonperforming loans          186.83            133.46         125.29           160.00         250.90
Allowance for loan losses to total loans                    1.28              1.32           1.29             1.28           1.19
Nonperforming loans to total loans                          0.69              0.99           1.03             0.80           0.47
Nonperforming assets to total assets                        0.73              0.93           0.88             0.87           0.45
Net charge-offs to average loans                            0.26              0.22           0.28             0.23           0.22
Equity to assets at period end                              7.85              8.52           8.02             7.24           7.23
Dividend payout ratio                                      32.19             23.67          25.31            26.69          33.68
====================================================================================================================================
</TABLE>

See the accompanying footnotes on the next page.

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

(1)   Oak Hill  Financial,  Inc. (the  "Company")  completed an  acquisition  of
      Ripley National Bank on October 9, 2004 for $5.3 million in cash,  whereby
      Oak Hill Banks and Ripley National Bank merged.

(2)   Oak  Hill  Financial,   Inc.  (the  "Company")  completed  a  merger  with
      Innovative  Financial  Services,  Inc. ("IFS") on August 31, 2001. IFS was
      renamed Oak Hill Financial Insurance Agency, Inc. and conducts business as
      MPA. The transaction was initiated prior to July 1, 2001 and was accounted
      for as a pooling-of-interests. Accordingly, the financial statements as of
      and for the year ended December 31, 2000 have  previously been restated as
      if the merger had occurred on January 1, 2000.

(3)   Includes loans held for sale.

(4)   General,  administrative  and other expense for 2001 includes  $259,000 in
      pre-tax expenses  incurred  pursuant to the merger with MPA. Also includes
      $160,000 in pre-tax expenses  incurred in 2004 pursuant to the merger with
      Ripley  National  Bank and the  pending  merger  with  Lawrence  Financial
      Holdings, Inc.

(5)   Per share  information  gives  retroactive  effect to the issuance 172,414
      shares in the MPA transaction.


                                       21
<PAGE>

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

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

OVERVIEW

      Oak Hill Financial,  Inc. (the "Company") is a financial  holding company,
the  principal  assets of which have been its  ownership of Oak Hill Banks ("Oak
Hill"),  Towne Bank ("Towne"),  Action Finance Company  ("Action") and MPA Group
Insurance Specialists ("MPA").  Accordingly, the Company's results of operations
are primarily  dependent  upon its  financial  service  subsidiaries,  which are
collectively  viewed  as a single  operating  segment  for  financial  statement
purposes.

      During 2002,  the Board of  Directors  of the Company,  Oak Hill and Towne
approved a plan of reorganization  whereby the Banks merged on November 30, 2002
into a single  bank  charter  under the name Oak Hill  Banks.  Hereinafter,  the
consolidated  financial  statements  use the term  "Oak  Hill" to  describe  the
preexisting individual banks owned by the Company.

      Oak Hill conducts a general  commercial  banking business that consists of
attracting  deposits from the general  public and using those funds to originate
loans for commercial,  consumer, and residential purposes. Action was a consumer
finance  company that originated  installment  and home equity loans.  MPA is an
insurance  agency  specializing  in group health  insurance  and other  employee
benefits.

      Oak Hill's  profitability  depends  primarily on its net interest  income,
which is the difference between interest income generated from  interest-earning
assets  (i.e.,  loans and  investments)  less the interest  expense  incurred on
interest-bearing  liabilities (i.e.,  deposits and borrowed funds). Net interest
income is  affected  by the  relative  amounts  of  interest-earning  assets and
interest-bearing  liabilities,  and the interest  rates paid on these  balances.
Additionally,  and to a lesser extent, profitability is affected by such factors
as the level of  non-interest  income and expenses,  the provision for losses on
loans,  and the effective tax rate.  Other income consists  primarily of service
charges   and  other  fees  and  income   from  the  sale  of  loans.   General,
administrative   and  other  expenses  consist  of  compensation  and  benefits,
occupancy-related expenses, franchise taxes, and other operating expenses.

      On October 9, 2004, the Company  acquired  Ripley National Bank ("Ripley")
for $5.3  million in cash.  As part of the  transaction,  the  Company  acquired
full-service  offices in Ripley and Georgetown,  Ohio,  involving total loans of
$39.1 million, $51.6 million in deposits and $58.6 million in total assets.

      On December 31, 2004,  the Company  sold the  consumer  loan  portfolio of
Action. The portfolio, which was comprised of small consumer and second mortgage
loans,  totaled $8.7 million.  Concurrent  with the sale, the Company closed its
five retail lending offices in southern Ohio.

      Management's  discussion  and analysis of earnings  and related  financial
data are presented herein to assist investors in understanding  the consolidated
financial  condition  and results of operations of the Company as of and for the
years ended December 31, 2004, 2003 and 2002. This discussion  should be read in
conjunction with the  consolidated  financial  statements and related  footnotes
presented elsewhere in this report.

FORWARD LOOKING STATEMENTS

      In the following pages,  management  presents an analysis of the Company's
financial  condition as of December 31, 2004,  and the results of operations for
the year ended December 31, 2004, as compared to prior  periods.  In addition to
this historical information, the following discussion and other sections of this
Annual  Report  contain  forward-looking   statements  that  involve  risks  and
uncertainties.   Economic  circumstances,   the  Company's  operations  and  the
Company's actual results could differ  significantly from those discussed in the
forward-looking  statements.  Some of the factors that could cause or contribute
to such differences are discussed herein but also include changes in the economy
and interest rates in the nation and the Company's general market area. Without


                                       22
<PAGE>

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

limiting  the  foregoing,   some  of  the  forward-looking   statements  include
management's  establishment of an allowance for loan losses,  and its statements
regarding  the  adequacy of such  allowance  for loan losses,  and  management's
belief that the allowance for loan losses is adequate.

CRITICAL ACCOUNTING POLICIES

      The  preparation of consolidated  financial  statements in conformity with
accounting  principles  generally  accepted  in the  United  States  of  America
requires  management to use judgments in making  estimates and assumptions  that
affect the reported amounts of assets,  liabilities,  revenues and expenses. The
following critical  accounting policies are based upon judgments and assumptions
by management that include inherent risks and uncertainties.

      Allowance  for  Losses  on  Loans:  The  balance  in  this  account  is an
accounting  estimate of  probable  but  unconfirmed  asset  impairment  that has
occurred in the  Company's  loan  portfolio  as of the date of the  consolidated
financial statements before losses have been confirmed resulting in a subsequent
charge-off  or  write-down.  It is the  Company's  policy to  provide  valuation
allowances  for  estimated  losses on loans  based  upon  past loss  experience,
adjusted for changes in trends and conditions of the certain items, including:

      o     Local market areas and national economic developments;

      o     Levels of and trends in delinquencies and impaired loans;

      o     Levels of and trends in recoveries of prior charge-offs;

      o     Adverse situations that may affect specific borrowers' ability to
            repay;

      o     Effects of any changes in lending policies and procedures;

      o     Credit concentrations;

      o     Experience, ability, and depth of lending management and credit
            administration staff;

      o     Volume and terms of loans; and

      o     Current collateral values, where appropriate.

      When the collection of a loan becomes doubtful, or otherwise troubled, the
Company records a loan loss provision  equal to the difference  between the fair
value of the property  securing the loan and the loan's  carrying  value.  Major
loans and major lending areas are reviewed  periodically to determine  potential
problems at an early date. The allowance for loan losses is increased by charges
to earnings and decreased by charge-offs (net of recoveries).

      The Company  accounts for its  allowance for losses on loans in accordance
with Statement of Financial Accounting Standards ("SFAS") No. 5, "Accounting for
Contingencies,"  and SFAS No. 114,  "Accounting by Creditors for Impairment of a
Loan." Both  Statements  require the Company to evaluate the  collectibility  of
both contractual  interest and principal loan payments.  SFAS No. 5 requires the
accrual  of a loss when it is  probable  that a loan has been  impaired  and the
amount of the loss can be  reasonably  estimated.  SFAS No.  114  requires  that
impaired loans be measured based upon the present value of expected  future cash
flows discounted at the loan's effective interest rate or, as an alternative, at
the loans' observable market price or fair value of the collateral.

      A loan is defined  under SFAS No. 114 as impaired  when,  based on current
information and events, it is probable that a creditor will be unable to collect
all amounts due according to the  contractual  terms of the loan  agreement.  In
applying the provisions of SFAS No. 114, the Company considers its investment in
one-to-four family residential loans, consumer installment loans and credit card
loans to be homogeneous and therefore excluded from separate  identification for
evaluation  of  impairment.  These  homogeneous  loan groups are  evaluated  for
impairment  in  accordance  with  SFAS No.  5.  With  respect  to the  Company's
investment  in  commercial  and other loans,  and its  evaluation  of impairment
thereof,  management believes such loans are adequately  collateralized and as a
result impaired loans are carried as a practical  expedient at the lower of cost
or fair value. It is the Company's  policy to charge off unsecured  credits that
are more than ninety days  delinquent.  Similarly,  collateral  dependent  loans
which are more than ninety days  delinquent  are  considered to constitute  more
than a minimum delay in repayment and are  evaluated for  impairment  under SFAS
No. 114 at that time.

      Mortgage Servicing Rights: Mortgage servicing rights are accounted for
pursuant to the provisions of SFAS No. 140, "Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities," which
requires that the Company recognize as separate assets, rights to service
mortgage loans for others, regardless of how those servicing rights are
acquired. An


                                       23
<PAGE>

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

institution that acquires mortgage  servicing rights through either the purchase
or origination  of mortgage  loans and sells those loans with  servicing  rights
retained must  allocate some of the cost of the loans to the mortgage  servicing
rights.

         The mortgage  servicing  rights recorded by the Company,  calculated in
accordance  with the provisions of SFAS No. 140, were  segregated into pools for
valuation  purposes,  using as pooling  criteria  the loan term and coupon rate.
Once pooled, each grouping of loans was evaluated on a discounted earnings basis
to determine the present value of future  earnings that a purchaser could expect
to  realize  from each  portfolio.  Earnings  were  projected  from a variety of
sources  including loan servicing fees,  interest earned on float,  net interest
earned on escrows,  miscellaneous  income,  and costs to service the loans.  The
present value of future earnings is the "economic"  value of the pool, i.e., the
net realizable present value to an acquirer of the acquired servicing.

         SFAS No. 140 requires that  capitalized  mortgage  servicing rights and
capitalized excess servicing  receivables be amortized in proportion to and over
the period of  estimated  net  servicing  income and  assessed  for  impairment.
Impairment is measured based on fair value. The valuation of mortgage  servicing
rights is influenced by market factors,  including  servicing volumes and market
prices, as well as management's assumptions regarding mortgage prepayment speeds
and interest  rates.  Management  utilizes  periodic  third-party  valuations by
qualified  market  professionals  to evaluate the fair value of its  capitalized
mortgage servicing assets.

         Goodwill and Other Intangible Assets. The Company has recorded goodwill
and core deposit intangibles as a result of merger and acquisition activity.

         Goodwill  represents  the excess  purchase price paid over the net book
value of the assets  acquired in a merger or  acquisition.  Pursuant to SFAS No.
142, "Goodwill and Intangible Assets," goodwill is not amortized,  but is tested
for  impairment  at the  reporting  unit  annually  and  whenever an  impairment
indicator arises.  The evaluation  involves  assigning assets and liabilities to
reporting  units and  comparing  the fair  value of each  reporting  unit to its
carrying value including goodwill. If the fair value of a reporting unit exceeds
its  carrying  amount,  goodwill is not  considered  impaired.  However,  if the
carrying  amount of the  reporting  unit  exceeds  the fair  value,  goodwill is
considered  impaired.  The  impairment  loss equals the excess of carrying value
over fair value.

         Core  deposit  intangibles  represent  the value of  long-term  deposit
relationships  and are amortized over their estimated  useful lives. The Company
annually  evaluates these estimated useful lives. If the Company determines that
events or  circumstances  warrant a change in these estimated  useful lives, the
Company  will adjust the  amortization  of the core deposit  intangibles,  which
could affect future amortization expense.

FINANCIAL CONDITION

      The  Company's  total  assets  amounted to $1.1 billion as of December 31,
2004, an increase of $144.8 million,  or 15.4%, over the $938.3 million total at
December 31, 2003. The increase was funded primarily  through growth in deposits
of $144.3 million,  an increase of $13.0 million in subordinated  debentures and
an increase in stockholders' equity of $5.1 million, which were partially offset
by a $17.3  million  decrease in Federal Home Loan Bank  advances and a $400,000
decrease in notes payable.

      Cash and due from banks,  federal funds sold, and  investment  securities,
including mortgage-backed securities, increased by $24.0 million, or 23.9%, to a
total of $124.0  million at December  31,  2004,  compared to December 31, 2003.
Investment  securities increased by $12.5 million, as purchases of $45.7 million
and the  acquisition  of $5.4  million  of  securities  acquired  in the  Ripley
National Bank merger  exceeded  maturities  and  repayments of $23.4 million and
sales of $13.9 million. Federal funds sold increased by $865,000 during 2004.

      Loans receivable  totaled $912.5 million at December 31, 2004, an increase
of $101.5  million,  or 12.5%,  over total  loans at  December  31,  2003.  Loan
disbursements  totaled  $464.8  million  during 2004,  including  $39.1  million
acquired in the Ripley National Bank merger, which were partially offset by loan
sales of $58.3 million and principal  repayments of $338.6  million during 2004.
Loan  disbursements  and sales  volume  decreased  by $156.2  million and $118.2
million,  respectively, as compared to 2003 volume. Growth in the loan portfolio
during 2004 was comprised of a $70.4 million,  or 13.7%,  increase in commercial
and other loans and a $34.9 million, or 14.8%,  increase in real estate mortgage
loans,  which were  partially  offset by a $3.0  million,  or 4.3%,  decrease in
installment loans. The Company's allowance for loan losses totaled $11.8 million
at December 31, 2004,  an increase of $1.0 million,  or 9.3%,  over the total at
December 31, 2003. The allowance for loan losses  represented 1.28% and 1.32% of
the total loan  portfolio  at  December  31,  2004 and 2003,  respectively.  Net
charge-offs  totaled $2.3 million and $1.7 million for the years ended  December
31, 2004 and 2003, respectively.  The Company's allowance represented 186.8% and
133.5% of  nonperforming  loans,  which totaled $6.3 million and $8.1 million at
December 31, 2004 and 2003,  respectively.  At December 31, 2004,  nonperforming
loans were  comprised of $603,000 in  installment  loans,  $2.5 million of loans
secured primarily by commercial real estate and $3.2 million of loans secured by
one-to-four  family  residential  real  estate.  In  management's  opinion,  all
nonperforming  loans were adequately  collateralized or reserved for at December
31, 2004.

      Deposits  totaled  $862.1  million at December  31,  2004,  an increase of
$144.3  million,  or 20.1%,  over the $717.8 million total at December 31, 2003.
The  increase  resulted   primarily  from  brokered  deposits  and  management's
marketing efforts to attract demand


                                       24
<PAGE>

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

deposits.  Brokered  deposits  continued to be an integral part of the Company's
overall funding strategy due to competitive  rates and lower  operational  costs
compared with retail deposits.  Brokered  deposits totaled $140.7 million with a
weighted-average  cost of 2.71% at December 31,  2004,  as compared to the $93.6
million in brokered deposits with a 3.04%  weighted-average cost at December 31,
2003.   Proceeds  from  deposit   growth  were  used   primarily  to  fund  loan
originations.

      Advances  from the  Federal  Home  Loan Bank  totaled  $105.6  million  at
December 31, 2004, a decrease of $17.3 million,  or 14.1%, from the December 31,
2003 total.  During 2004,  management  reduced its reliance on advances from the
Federal Home Loan Bank in favor of procuring  more demand  deposit  accounts and
competitively-priced  certificates  of deposit.  Proceeds  from the Federal Home
Loan Bank advances were used primarily to fund loan originations during the year

      During 2004, a Delaware statutory business trust owned by the Company, Oak
Hill Capital Trust 2 ("Trust 2"), issued $5.0 million of mandatorily  redeemable
debt  securities.  The debt  securities  issued by Trust 2 are  included  in the
Company's regulatory capital, specifically as a component of Tier 1 capital. The
proceeds from the issuance of the subordinated  debentures and common securities
were used by Trust 2 to purchase  from the Company $5.0 million of  subordinated
debentures  maturing on October 18, 2034.  The  subordinated  debentures are the
sole  asset of Trust 2, and the  Company  owns all of the common  securities  of
Trust 2. Interest payments on the debt securities are to be made quarterly at an
annual  fixed  rate of  interest  of 6.24%  through  October  18,  2009 and at a
floating rate of interest,  reset  quarterly,  equal to 3-month LIBOR plus 2.40%
thereafter. Interest payments are reported as a component of interest expense on
borrowings.  The net proceeds  received by the Company were  contributed  to the
capital of Oak Hill during the current year.

      On October  1, 2004,  a Delaware  statutory  business  trust  owned by the
Company,  Oak  Hill  Capital  Trust  3  ("Trust  3"),  issued  $8.0  million  of
mandatorily  redeemable debt securities.  The debt securities  issued by Trust 3
are included in the Company's regulatory capital, specifically as a component of
Tier 1 capital.  The proceeds from the issuance of the  subordinated  debentures
and common  securities  were used by Trust 3 to purchase  from the Company  $8.0
million  of   subordinated   debentures   maturing  on  October  18,  2034.  The
subordinated  debentures are the sole asset of Trust 3, and the Company owns all
of the common  securities of Trust 3. Interest  payments on the debt  securities
are to be made quarterly at a floating rate of interest, reset quarterly,  equal
to 3-month  LIBOR plus 2.30%.  Interest  payments are reported as a component of
interest expense on borrowings. The net proceeds received by the Company will be
used for merger activity and general corporate purposes.

      The Company's  stockholders'  equity amounted to $85.0 million at December
31, 2004, an increase of $5.1 million, or 6.4%, over the balance at December 31,
2003.  The increase  resulted  primarily  from net earnings of $10.7 million and
proceeds from options exercised of $2.6 million,  which were partially offset by
the Company's  repurchase of 134,936 outstanding shares of its common stock at a
weighted-average  price of $32.38 per share totaling $4.4 million, a decrease in
the  unrealized  gain on  securities,  net of tax,  totaling  $310,000  and $3.4
million in dividends declared on common stock.

SUMMARY OF EARNINGS

      The table on page 30 shows for each  category of  interest-earning  assets
and interest-bearing  liabilities,  the average amount outstanding, the interest
earned or paid on such amount, and the average rate earned or paid for the years
ended  December 31, 2004,  2003 and 2002.  The table also shows the average rate
earned  on  all   interest-earning   assets,   the  average  rate  paid  on  all
interest-bearing  liabilities,  the interest  rate spread,  and the net interest
margin for the same periods.

      Changes in net  interest  income  are  attributable  to either  changes in
average  balances  (volume change) or changes in average rates (rate change) for
interest-earning  assets  and  interest-bearing  liabilities.  Volume  change is
calculated  as change  in  volume  times  the old  rate,  while  rate  change is
calculated  as  change  in rate  times  the old  volume.  The  table  on page 31
indicates  the dollar  amount of the change  attributable  to each  factor.  The
rate/volume  change, the change in rate times the change in volume, is allocated
between the volume change and the rate change at the ratio each component  bears
to the absolute value of their total.

COMPARISON  OF RESULTS OF OPERATIONS  FOR THE YEARS ENDED  DECEMBER 31, 2004 AND
2003

      General.  Net earnings for the year ended  December 31, 2004 totaled $10.7
million, a $1.9 million, or 15.2%, decrease from 2003 net earnings. The decrease
in earnings  resulted  primarily  from a $4.9 million  decrease in other income,
which was partially offset by a $211,000 decrease in the provision for losses on
loans,  a $3.7  million  increase in net  interest  income,  and a $1.9  million
decrease in the provision for federal income taxes.

      Net Interest Income. Total interest income for the year ended December 31,
2004,  amounted to $59.3 million, an increase of $4.1 million, or 7.4%, from the
total  recorded for 2003.  Interest  income on loans totaled $55.5  million,  an
increase of $3.5 million,  or 6.8%, from the 2003 period. This increase resulted
primarily  from a $115.3  million,  or 15.3%,  increase in the  weighted-average
("average")  portfolio balance,  to a total of $869.8 million in 2004, which was
partially  offset by a 50 basis  point  decrease  in the  average  fully-taxable
equivalent  yield,  to 6.41% in 2004  from  6.91% in 2003.  Interest  income  on
investment securities and other  interest-earning  assets increased by $550,000,
or 17.4%. The increase resulted  primarily from a 31 basis point increase in the
average fully-taxable


                                       25
<PAGE>

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

equivalent  yield,  to 4.44%  in 2004,  coupled  with a $7.3  million,  or 8.5%,
increase in the average portfolio balance, to a total of $93.8 million in 2004.

      Total  interest  expense  amounted  to $20.8  million  for the year  ended
December 31, 2004, a decrease of $370,000,  or 1.8%,  from the total recorded in
2003. Interest expense on deposits increased by $346,000, or 2.2%, to a total of
$15.9 million in 2004. The increase resulted primarily from a $103.6 million, or
16.9%,  increase in the average portfolio balance,  to a total of $714.9 million
in 2004,  which was partially offset by a 32 basis point decrease in the average
cost of deposits,  to 2.23% in 2004. Interest expense on borrowings increased by
$24,000, or 0.5%, during 2004. This increase was due to a $7.2 million, or 6.1%,
increase in average borrowings  outstanding,  which was partially offset by a 22
basis point  decrease in the average cost of  borrowings,  to 3.95% in 2004. The
decrease  in the  level of  yields on  interest-earning  assets  and the cost of
interest-bearing  liabilities  was  primarily  due to the  overall  decrease  in
interest rates in the economy throughout 2004 and 2003.

      As a result of the  foregoing  changes in  interest  income  and  interest
expense,  net interest income increased by $3.7 million,  or 10.7%, for the year
ended December 31, 2004, as compared to 2003. The interest rate spread decreased
by 7 basis points to 3.74% in 2004, compared to 3.81% in 2003. The fully-taxable
equivalent net interest margin  decreased by 14 basis point from,  4.19% in 2003
to 4.05% in 2004.

      Provision for Losses on Loans.  A provision for losses on loans is charged
to earnings to bring the total  allowance for loan losses to a level  considered
appropriate by management based on historical experience, the volume and type of
lending conducted by the Company,  the status of past due principal and interest
payments, general economic conditions, particularly as such conditions relate to
the Company's market area and other factors related to the collectibility of the
Company's loan portfolio.  As a result of such analysis,  management  recorded a
$3.1 million provision for losses on loans for the year ended December 31, 2004,
a decrease of $211,000,  or 6.3%,  compared to 2003. The provision for losses on
loans in 2004 was  predicated  upon a decrease of $1.8 million in  nonperforming
loans from $8.1 million in 2003 to $6.3 million at December 31, 2004, the $102.5
million of growth in the gross loan  portfolio  and net  charge-offs  in 2004 of
$2.3 million.

      Although management  believes that it uses the best information  available
in  providing  for  possible  loan losses and  believes  that the  allowance  is
adequate at December 31, 2004,  future  adjustments  to the  allowance  could be
necessary and net earnings could be affected if  circumstances  and/or  economic
conditions differ  substantially from the assumptions used in making the initial
determinations.

      Other  Income.  Other  income  totaled  $6.7  million  for the year  ended
December 31, 2004, a decrease of $4.9  million,  or 42.2%,  compared to the 2003
amount. This decrease resulted primarily from a $2.6 million, or 58.1%, decrease
in gain on sale of loans and a $3.6  million  loss on the sale of Action's  loan
portfolio and related assets,  which were partially offset by a $1.5 million, or
38.1%,  increase in service  fees,  charges,  and other  operating  income and a
$223,000,  or 7.9%, increase in insurance  commissions.  The decrease in gain on
sale of loans  resulted  from an  expected  decrease in the volume of loans sold
year-to-year,  which was partially offset by an increase of $312,000,  or 57.4%,
in gains on sales of the  guaranteed  portions of  commercial  loans  originated
under  the  Small  Business  Administration's  ("SBA")  7(a)  program  and other
commercial  loans  originated  under the SBA 504 loan  program.  The increase in
commissions was due primarily to increased  premiums  realized on sales of group
health insurance. The increase in service charges, fees and other income was due
primarily to an increase in overdraft fees totaling $452,000, or 17.7%, over the
total  recorded  in 2003,  as a result  of a new  overdraft  protection  program
implemented in late March 2003, coupled with a $698,000,  or 54.3%,  decrease in
amortization and impairment of mortgage servicing rights.

      General,  Administrative  and Other Expense.  General,  administrative and
other expense  totaled  $26.9  million for the year ended  December 31, 2004, an
increase of $2.9 million,  or 12.0%,  over the 2003 total. The increase resulted
primarily  from a  $318,000,  or 2.2%,  increase in  employee  compensation  and
benefits,  a $1.1 million, or 16.9%,  increase in other operating  expenses,  an
increase of  $490,000,  or 16.8%,  in  occupancy  and  equipment  and a $919,000
increase in franchise taxes. The increase in employee  compensation and benefits
resulted  primarily from increased  staffing  levels required in connection with
the establishment of new branch locations,  additional  management  staffing and
normal merit increases. The increase in other operating expenses resulted from a
$194,000  increase in ATM costs  associated  with switching  service  providers,
coupled  with an overall  increase  in ATM  locations,  a $175,000  increase  in
professional  fees,  $160,000 in merger-related  expenses in connection with the
previously mentioned Ripley merger, an $80,000 increase in credit and collection
expense,  a  $72,000  increase  in  amortization  of  intangibles  and a $71,000
increase in  consulting  fees,  which are based upon the  increase in  overdraft
fees. The remaining increase of $388,000, or 5.7%, was due to pro-rata increases
in  other  operating   expenses   attendant  to  the  Company's  overall  growth
year-to-year.  The increase in occupancy and equipment expense was due primarily
to a  $109,000,  or 14.7%,  increase  in rent  expense,  a  $146,000,  or 18.8%,
increase  in  maintenance  contracts  and a  $160,000,  or  16.3%,  increase  in
depreciation  expense  year-to-year.  The  increases  in rent  and  depreciation
expenses are primarily  attributable  to new office  locations.  The increase in
franchise  taxes was  attributable  to a tax savings for 2003 resulting from the
previously mentioned Oak Hill-Towne merger in 2002.

      Federal  Income Taxes.  The provision for federal income taxes amounted to
$4.3 million for the year ended  December 31, 2004, a decrease of $1.9  million,
or 30.7%,  compared to the $6.3 million recorded in 2003. The decrease  resulted
primarily  from a $3.8  million,  or 20.4%,  decrease in earnings  before taxes,
coupled with $500,000 in new markets tax credits pursuant to Oak Hill's


                                       26
<PAGE>

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

$10.0  million  qualified  equity   investments  in  Oak  Hill  Banks  Community
Development  Corp.  The  effective  tax rates were 28.9% and 33.3% for the years
ended December 31, 2004 and 2003, respectively.

COMPARISON OF RESULTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2003 AND
2002

      General.  Net earnings for the year ended  December 31, 2003 totaled $12.6
million, a $2.2 million, or 21.6%, increase over 2002 net earnings. The increase
in earnings  resulted  primarily  from a $2.2  million  increase in net interest
income and a $3.4 million increase in other income,  which were partially offset
by a $590,000  increase in the  provision  for losses on loans,  a $1.4  million
increase  in  general,  administrative  and other  expense,  and a $1.4  million
increase in the provision for federal income taxes.

      Net Interest Income. Total interest income for the year ended December 31,
2003,  amounted to $55.2 million, a decrease of $2.1 million,  or 3.6%, from the
total  recorded for 2002.  Interest  income on loans  totaled $52.0  million,  a
decrease of $651,000,  or 1.2%,  from the 2002 period.  This  decrease  resulted
primarily from a 74 basis point decrease in the average fully-taxable equivalent
yield,  to 6.91% in 2003 from  7.65% in 2002,  which was  partially  offset by a
$64.0 million, or 9.3%, increase in the weighted-average  ("average")  portfolio
balance,  to a total of $754.5  million in 2003.  Interest  income on investment
securities  and other  interest-earning  assets  decreased by $1.4  million,  or
30.7%.  The decrease  resulted  primarily from an 83 basis point decrease in the
average  fully-taxable  equivalent yield, to 4.13% in 2003, coupled with a $13.8
million,  or 16.0%,  decrease in the average  portfolio  balance,  to a total of
$86.5 million in 2003.

      Total  interest  expense  amounted  to $20.5  million  for the year  ended
December 31, 2003, a decrease of $4.3 million, or 17.2%, from the total recorded
in 2002.  Interest expense on deposits decreased by $4.1 million, or 20.7%, to a
total of $15.6 million in 2003. The decrease resulted  primarily from a 77 basis
point  decrease in the average  cost of  deposits,  to 2.55% in 2003,  which was
partially offset by an $18.5 million, or 3.1%, increase in the average portfolio
balance,  to a total of $611.3 million in 2003.  Interest  expense on borrowings
decreased by $179,000,  or 3.5%,  during  2003.  This  decrease was due to an 81
basis point decrease in the average cost of borrowings,  to 4.17% in 2003, which
was  partially  offset  by a  $15.5  million,  or  15.2%,  increase  in  average
borrowings outstanding.  The decrease in the level of yields on interest-earning
assets and the cost of  interest-bearing  liabilities  was  primarily due to the
overall decrease in interest rates in the economy throughout 2003 and 2002.

      As a result of the  foregoing  changes in  interest  income  and  interest
expense,  net interest income  increased by $2.2 million,  or 6.8%, for the year
ended December 31, 2003, as compared to 2002. The interest rate spread increased
by 6 basis points to 3.81% in 2003, compared to 3.75% in 2002. The fully-taxable
equivalent net interest margin increased by 1 basis point from, 4.18% in 2002 to
4.19% in 2003.

      Provision for Losses on Loans.  A provision for losses on loans is charged
to earnings to bring the total  allowance for loan losses to a level  considered
appropriate by management based on historical experience, the volume and type of
lending conducted by the Company,  the status of past due principal and interest
payments, general economic conditions, particularly as such conditions relate to
the Company's market area and other factors related to the collectibility of the
Company's loan portfolio.  As a result of such analysis,  management  recorded a
$3.3 million provision for losses on loans for the year ended December 31, 2003,
an increase of $590,000, or 21.4%, compared to 2002. The provision for losses on
loans in 2003 was predicated upon the $110.8 million of growth in the gross loan
portfolio,  net  charge-offs in 2003 of $1.7 million and an increase of $823,000
in nonperforming loans from $7.3 million in 2002 to $8.1 million at December 31,
2003.

      Although management  believes that it uses the best information  available
in  providing  for  possible  loan losses and  believes  that the  allowance  is
adequate at December 31, 2003,  future  adjustments  to the  allowance  could be
necessary and net earnings could be affected if  circumstances  and/or  economic
conditions differ  substantially from the assumptions used in making the initial
determinations.

      Other  Income.  Other  income  totaled  $11.5  million  for the year ended
December 31, 2003, an increase of $3.4 million,  or 42.2%, over the 2002 amount.
This increase resulted primarily from a $2.1 million, or 90.4%, increase in gain
on sale of loans, a $1.0 million,  or 36.7%,  increase in service fees, charges,
and other  operating  income,  and a $370,000,  or 15.1%,  increase in insurance
commissions,  which were partially offset by a $122,000 gain on sale of branches
recorded  in  2002.  The  increase  in gain on sale of  loans  resulted  from an
increase in the volume of loans sold  year-to-year.  The  increase in  insurance
commissions was due primarily to increased  premiums  realized on sales of group
health insurance. The increase in service fees, charges and other income was due
primarily to an increase in overdraft  fees totaling $1.3 million over the total
recorded in 2002, as a result of a new overdraft  protection program implemented
in late March 2003.

      Although the Company anticipated that non-interest income overall would be
less in 2004  compared  to  2003,  and the  gain on sale of  one-to-four  family
residential  loans  would  be  substantially  lower,   management  deployed  its
origination  efforts to increase sales of commercial  loans originated under the
Small  Business  Administration's  ("SBA") 504 loan  program and the  guaranteed
portion of commercial loans  originated  under the SBA 7(a) program,  as well as
focusing  its  efforts  to  increase  deposit  account  service  charges,  title
insurance, health insurance, and brokerage services.


                                       27
<PAGE>

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

      General,  Administrative  and Other Expense.  General,  administrative and
other expense  totaled  $24.0  million for the year ended  December 31, 2003, an
increase of $1.4 million,  or 6.1%, over the 2002 total.  The increase  resulted
primarily from a $1.1 million,  or 8.2%,  increase in employee  compensation and
benefits,  an $843,000,  or 14.2%,  increase in other operating  expenses and an
increase of $477,000, or 19.6%, in occupancy and equipment, which were partially
offset by a $640,000  decrease  in  franchise  taxes and a $367,000  decrease in
merger-related  expenses.  The  increase in employee  compensation  and benefits
resulted  primarily from increased  staffing  levels required in connection with
the establishment of new branch locations,  additional  management  staffing and
normal  merit  increases.  The  increase  in other  operating  expense  resulted
primarily from a $259,000 increase in credit and collection  expenses associated
with increased  lending volume and delinquency  levels,  a $188,000  increase in
consulting fees, which are based upon the increase in overdraft fees, an $82,000
increase in expenses related to minority ownership  interests in Oak Hill Title,
a $26,000  increase  in  insurance  commissions  paid and a $43,000  increase in
computer and PC software costs. The remaining increase of $245,000, or 4.1%, was
due to pro-rata increases in other operating expenses attendant to the Company's
overall growth year-to-year. The increase in occupancy and equipment expense was
due primarily to a $153,000,  or 26.1%, increase in rent expense, a $110,000, or
26.7%,  increase in maintenance  contracts and a $189,000, or 23.7%, increase in
depreciation  expense  year-to-year.  The  increases  in rent  and  depreciation
expenses are primarily  attributable  to new office  locations.  The decrease in
franchise  taxes was  attributable  to a tax savings for 2003 resulting from the
Oak Hill-Towne merger in 2002. The decrease in  merger-related  expenses was due
to the  absence  of  $367,000  in  costs  incurred  in  connection  with the Oak
Hill-Towne merger.

      Federal  Income Taxes.  The provision for federal income taxes amounted to
$6.3 million for the year ended  December 31, 2003, an increase of $1.4 million,
or  29.2%,  over the  $4.9  million  recorded  in 2002.  The  increase  resulted
primarily from a $3.7 million,  or 24.0%,  increase in earnings before taxes and
the increase in tax rates  attendant to the Company's  level of pre-tax  income.
The  effective  tax rates were 33.3% and 31.9% for the years ended  December 31,
2003 and 2002, respectively.

LIQUIDITY AND CAPITAL RESOURCES

      Like other financial institutions, the Company must ensure that sufficient
funds are available to meet deposit withdrawals, loan commitments, and expenses.
Control of the Company's  cash flow requires the  anticipation  of deposit flows
and  loan  payments.  The  Company's  primary  sources  of funds  are  deposits,
borrowings and principal and interest  payments on loans. The Company uses funds
from deposit  inflows,  proceeds  from  borrowings  and  principal  and interest
payments on loans  primarily  to  originate  loans,  and to purchase  short-term
investment securities and interest-bearing deposits.

      At December 31, 2004,  the Company had $239.2 million of  certificates  of
deposit maturing within one year. It has been the Company's historic  experience
that such  certificates of deposit will be renewed with Oak Hill at market rates
of interest.  It is  management's  belief that maturing  certificates of deposit
over the next year will  similarly  be renewed with the Oak Hill at market rates
of interest without a material adverse effect on the results of operations.

      In the event that  certificates  of deposit cannot be renewed at prevalent
market rates,  the Company can obtain up to $274.2  million in advances from the
Federal Home Loan Bank of Cincinnati (FHLB). Also, as an operational philosophy,
the Company seeks to obtain advances to help with asset/liability management and
liquidity.  At December 31, 2004,  the Company had $105.6 million of outstanding
FHLB advances.

      The Company engages in off-balance  sheet  credit-related  activities that
could  require  the Company to make cash  payments  in the event that  specified
future events occur. The contractual  amounts of these activities  represent the
maximum exposure to the Company.  However, certain off-balance sheet commitments
are expected to expire or be only partially used; therefore, the total amount of
commitments  does not  necessarily  represent  future cash  requirements.  These
off-balance  sheet  activities are necessary to meet the financing  needs of the
Company's  customers.  At December 31, 2004,  the Company had total  off-balance
sheet contractual  commitments  consisting of $21.7 million in loan commitments,
or loans committed but not closed,  $139.9 million in unused lines of credit and
letters of credit totaling $15.2 million.  Funding for these amounts is expected
to be provided by the sources described above.  Management  believes the Company
has adequate resources to meet its normal funding requirements.

      The table below  details the amount of loan  commitments,  unused lines of
credit and letters of credit  outstanding  at December 31, 2004,  by  expiration
period:

<TABLE>
<CAPTION>
==========================================================================================
                                                One year         Two to           After
(In thousands)                   or less       three years     three years        Total
------------------------------------------------------------------------------------------
<S>                              <C>             <C>             <C>             <C>
Loan commitments                 $ 21,732        $     --        $     --        $ 21,732
Unused lines of credit             70,447          21,435          48,032         139,914
Letters of credit                     925           4,310          10,000          15,235
------------------------------------------------------------------------------------------
                                 $ 93,104        $ 25,745        $ 58,032        $176,881
==========================================================================================
</TABLE>


                                       28
<PAGE>

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

      The table below details the amount of contractual  obligations outstanding
at December 31, 2004, by expiration period:

<TABLE>
<CAPTION>
===================================================================================================================
                                                         One year         Two to           After
(In thousands)                                            or less       three years     three years         Total
-------------------------------------------------------------------------------------------------------------------
<S>                                                       <C>             <C>             <C>             <C>
Advances from the Federal Home Loan Bank                  $ 43,426        $  7,902        $ 54,273        $105,601
Guaranteed preferred beneficial interests in
     the Corporation's junior subordinated debentures           --              --          18,000          18,000
Lease obligations                                              614             953           1,471           3,038
-------------------------------------------------------------------------------------------------------------------
                                                          $ 44,040        $  8,855        $ 73,744        $126,639
===================================================================================================================
</TABLE>

MANAGEMENT'S ASSESSMENT OF INTERNAL CONTROL OVER FINANCIAL REPORTING

      Management  is  responsible  for  establishing  and  maintaining  adequate
internal control over financial reporting that is designed to provide reasonable
assurance of the  reliability  of financial  reporting  and the  preparation  of
financial  statements  in accordance  with U.S.  generally  accepted  accounting
principles.  Management  assessed the effectiveness of its internal control over
financial  reporting  as of December  31,  2004,  in  relation  to criteria  for
effective  internal  control over financial  reporting as described in "Internal
Control  -  Integrated   Framework,"  issued  by  the  Committee  of  Sponsoring
Organizations  of  the  Treadway   Commission   (COSO  criteria).   Management's
assessment reflects  exceptions to the operating  effectiveness of the system of
internal  controls  in  the  lending  function,   principally  related  to  loan
approvals,  none of which  gave rise to  adjustments  to the  Company's  audited
financial statements.

      Grant Thornton LLP,  independent  registered  public  accounting firm, has
audited management's  assessment included in Management's Assessment of Internal
Control  Over  Financial  Reporting  as of  December  31,  2004,  based  on COSO
criteria.  See  Item  9A of  the  Company's  annual  report  on  Form  10-K  for
management's  assessment and Grant  Thornton's  attestation  reports on internal
controls over financial reporting.


                                       29
<PAGE>

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

AVERAGE BALANCE AND INTEREST RATES

<TABLE>
<CAPTION>
                                                                          Year Ended December 31,
                                    ------------------------------------------------------------------------------------------------
                                                2004                             2003                             2002
                                    ------------------------------------------------------------------------------------------------
                                              Interest                        Interest                         Interest
                                    Average    Income/    Average   Average    Income/   Average    Average     Income/      Average
(Dollars in thousands)              Balance    Expense     Rate     Balance    Expense     Rate     Balance     Expense       Rate
------------------------------------------------------------------------------------------------------------------------------------
<S>                                 <C>        <C>          <C>     <C>       <C>          <C>     <C>          <C>            <C>
Interest earnings assets:
  Loans receivable                  $869,849   $ 55,734     6.41%   $754,519  $ 52,138     6.91%   $690,544     $ 52,797       7.65%
  Investment securities               90,415      4,119     4.56      84,277     3,551     4.21      92,580        4,853       5.24
  Federal funds sold                     929         15     1.61         699         7     1.00       7,499          119       1.59
  Interest-earning deposits            2,472         28     1.13       1,508        18     1.19         230           10       4.35
------------------------------------------------------------------------------------------------------------------------------------
    Total interest-
      earnings assets                963,665     59,896     6.22     841,003    55,714     6.62     790,853       57,779       7.31
Non-interest earning assets           33,361                          27,003                         27,459
                                    --------                        --------                       --------
    Total assets                    $997,026                        $868,006                       $818,312
                                    ========                        ========                       ========

Interest-bearing liabilities:
Deposits:
  Savings accounts                  $ 52,292        195     0.37    $ 47,385       295     0.62    $ 43,588          485       1.11
  NOW accounts                        70,990        804     1.13      61,200       839     1.37      62,003        1,204       1.94
  Money market deposit accounts        7,930         31     0.39       7,993        56     0.70       7,951          108       1.36
  Premium & select investments        74,364        967     1.30      71,848       812     1.13      69,657        1,249       1.79
  Certificates of deposit            509,340     13,926     2.73     422,905    13,575     3.21     409,656       16,608       4.05
Borrowings                           124,514      4,915     3.95     117,328     4,891     4.17     101,818        5,070       4.98
------------------------------------------------------------------------------------------------------------------------------------
    Total interest-bearing
      liabilities                    839,430     20,838     2.48     728,659    20,468     2.81     694,673       24,724       3.56
                                               -----------------              -----------------                 -------------------

Non interest-bearing
  liabilities                         74,888                          35,706                         61,962
Stockholders' equity                  82,708                          73,641                         61,677
                                    --------                        --------                       --------
    Total liabilities and
      stockholders' equity          $997,026                        $868,006                       $818,312
                                    ========                        ========                       ========

Net interest income and
  interest rate spread                         $ 39,058     3.74%             $ 35,246     3.81%                $ 33,055       3.75%
                                               =================              =================                 ===================

Net interest margin (1)                                     4.05%                          4.19%                               4.18%
                                                          ======                         ======                              ======
Average interest-earning
  assets to average
  interest-bearing liabilities                            114.80%                        115.42%                             113.85%
                                                          ======                         ======                              ======

Adjustment of interest
  income to a tax-equivalent
  basis on tax-exempt:
    Loans and investment
      securities                               $    645                       $    544                          $    557
                                               ========                       ========                          ========
</TABLE>

(1)   The  net  interest  margin  is net  interest  income  divided  by  average
      interest-earning assets.


                                       30
<PAGE>

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

RATE/VOLUME TABLE

<TABLE>
<CAPTION>
                                                                      Year Ended December 31,
                                              ------------------------------------------------------------------------
                                                        2004 vs. 2003                          2003 vs. 2002
                                              ------------------------------------------------------------------------
                                                  Increase (decrease) due to             Increase (decrease) due to
(In thousands)                                 Volume        Rate        Total       Volume        Rate          Total
----------------------------------------------------------------------------------------------------------------------
<S>                                           <C>          <C>          <C>          <C>          <C>          <C>
Interest income attributable to:(1)
     Loans receivable                         $ 7,554      $(3,958)     $ 3,596      $ 4,693      $(5,352)     $  (659)
     Investment securities                        100          468          568         (506)        (796)      (1,302)
     Federal funds sold                             3            5            8          (79)         (33)        (112)
     Interest-earning deposits with banks          11           (1)          10            9           (1)           8
----------------------------------------------------------------------------------------------------------------------
          Total interest income               $ 7,668      $(3,486)     $ 4,182      $ 4,117      $(6,182)     $(2,065)
======================================================================================================================
Interest expense attributable to:
Deposits:
     Savings accounts                         $    10      $  (110)     $  (100)     $    29      $  (219)     $  (190)
     NOW accounts                                 101         (136)         (35)          (2)        (363)        (365)
     Money market deposit accounts                 (2)         (23)         (25)           2          (54)         (52)
     Premium & select investments                  42          113          155           35         (472)        (437)
     Certificates of deposit                    2,235       (1,884)         351          503       (3,536)      (3,033)
Borrowings                                        289         (265)          24          711         (890)        (179)
----------------------------------------------------------------------------------------------------------------------
          Total interest expense              $ 2,675      $(2,305)     $   370      $ 1,278      $(5,534)     $(4,256)
======================================================================================================================
Increase in net interest income                                         $ 3,812                                $ 2,191
======================================================================================================================
</TABLE>

(1) Presented on a tax-equivalent basis.

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

Item 7A. Quantitative and Qualitative Disclosure About Market Risk

      This information is presented in "Asset and Liability Management" on pages
12 through 14 of this report.

Item 8. Financial Statements and Supplementary Data

      Consolidated  Financial  Statements  of the  Company,  together  with  the
reports  thereon of Grant  Thornton  LLP (dated March 17, 2005) are set forth on
pages 44 through 75 hereof (see Item 15 of this Annual Report for Index).

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

      Not Applicable.

Item 9A. Controls and Procedures

Disclosure Controls and Procedures
----------------------------------

      Management  is  responsible  for  establishing  and  maintaining  adequate
internal  control  over  financial  reporting,  as such term is defined in Rules
13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934 (the "Exchange
Act"). The Company's  disclosure controls and procedures are designed to provide
reasonable  assurance that information required to be disclosed in the Company's
reports under the Exchange Act is recorded,  processed,  summarized and reported
within the time periods  specified in the Securities  and Exchange  Commission's
rules and forms,  and that such  information is accumulated and  communicated to
management,  including the Company's Chief Executive Officer and Chief Financial
Officer as appropriate, to allow timely decisions regarding required disclosure.

      Internal  control  over  financial  reporting  may not  prevent  or detect
misstatements  due to its inherent  limitations.  Projections  of any evaluation
effectiveness to future periods are subject to the risk that controls may become
inadequate  because of changes in  conditions,  or that the degree of compliance
with the policies or procedures may deteriorate.


                                       31
<PAGE>

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

Management's Report on Internal Control Over Financial Reporting
----------------------------------------------------------------

      Management  conducted  an  evaluation  of the  effectiveness  of  internal
control over financial  reporting as of December 31, 2004 based on the framework
in Internal Control - Integrated Framework issued by the Committee of Sponsoring
Organizations  of  the  Treadway   Commission.   The  scope  of  the  evaluation
encompassed  all  branches  of its  primary  subsidiary  Oak Hill Banks with the
exception of the two  branches  acquired in the Ripley  National  Bank merger in
October  2004.  The two branches  acquired  accounted  for  approximately  $38.8
million, or 4.2%, of loans receivable and approximately  $99,000, or 0.9% of net
earnings of the Company at and for the twelve  months  ended  December 31, 2004.
The following material weaknesses were identified during the evaluation:

      o  Incomplete   documentation   on  loan   approvals;   and

      o  Incomplete documentation on wire transfer approvals.

      Based on the evaluation,  management concluded that the Company's internal
control over  financial  reporting  was not  effective at December 31, 2004.  To
address the material weaknesses identified, management will monitor adherence to
existing controls and implement additional controls, as necessary,  with respect
to loan  and  wire  transfer  approvals.  Management's  assessment  of  internal
controls over  financial  reporting  has been audited by Grant  Thornton LLP, an
independent  registered  accounting  firm,  as stated in their  report  included
herein.

Report of Independent Registered Public Accounting Firm
-------------------------------------------------------

Board of Directors and Shareholders of Oak Hill Financial, Inc.

We have audited management's assessment, included in the accompanying Management
Report on Internal  Control over Financial  Reporting,  that Oak Hill Financial,
Inc. (the "Company") did not maintain  effective internal control over financial
reporting  as of  December  31,  2004,  because  of the  effect of the  material
weaknesses identified in management's assessment,  based on criteria established
by  the  Committee  of  Sponsoring  Organizations  of  the  Treadway  Commission
("COSO").  Oak Hill Financial,  Inc.'s management is responsible for maintaining
effective  internal  control over financial  reporting and for its assessment of
the   effectiveness   of  internal   control  over  financial   reporting.   Our
responsibility  is to  express  an opinion  on  management's  assessment  and an
opinion on the  effectiveness  of the Company's  internal control over financial
reporting based on our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain  reasonable  assurance  about whether  effective
internal  control  over  financial  reporting  was  maintained  in all  material
respects. Our audit included obtaining an understanding of internal control over
financial reporting,  evaluating management's assessment, testing and evaluating
the design and operating  effectiveness of internal control, and performing such
other  procedures as we considered  necessary in the  circumstances.  We believe
that our audit provides a reasonable basis for our opinion.

A company's  internal control over financial  reporting is a process designed to
provide reasonable  assurance  regarding the reliability of financial  reporting
and the preparation of consolidated  financial  statements for external purposes
in  accordance  with  generally  accepted  accounting  principles.  A  company's
internal control over financial reporting includes those policies and procedures
that (1) pertain to the  maintenance  of records  that,  in  reasonable  detail,
accurately and fairly reflect the transactions and dispositions of assets of the
company;  (2) provide  reasonable  assurance that  transactions  are recorded as
necessary  to  permit  preparation  of  consolidated   financial  statements  in
accordance with generally accepted accounting principles,  and that receipts and
expenditures   of  the   company  are  being  made  only  in   accordance   with
authorizations  of  management  and  directors of the  company;  and (3) provide
reasonable  assurance  regarding  prevention or timely detection of unauthorized
acquisition,  use,  or  disposition  of the  company's  assets that could have a
material effect on the financial statements.

Because of its inherent  limitations,  internal control over financial reporting
may not prevent or detect misstatements.  Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate  because of changes in  conditions,  or that the degree of compliance
with the policies and procedures mat deteriorate.

A  material  weakness  is  a  control  deficiency,  or  combination  of  control
deficiencies,  that  results  in more than a remote  likelihood  that a material
misstatement of the annual or interim consolidated financial statements will not
be prevented or detected. The following material weaknesses have been identified
and included in management's assessment.  There were instances where the Company
had incomplete documentation on loan and wire transfer approvals. These material
weaknesses  were  considered in determining  the nature,  timing,  and extent of
audit tests applied in our audit of the 2004 consolidated  financial statements,
and this  report  does not affect  our report  dated  March 17,  2005,  on those
financial statements.


                                       32
<PAGE>

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

In our opinion,  management's  assessment that Oak Hill Financial,  Inc. did not
maintain effective internal control over financial  reporting as of December 31,
2004, is fairly stated, in all material respects,  based on the control criteria
established in Internal  Control - Integrated  Framework issued by the Committee
of Sponsoring  Organizations  of the Treadway  Commission.  Also in our opinion,
because  of the  effect  of  the  material  weaknesses  described  above  on the
achievement of the objectives of the control criteria, Oak Hill Financial,  Inc.
has not maintained  effective  internal  control over financial  reporting as of
December 31, 2004,  based on Internal  Control - Integrated  Framework issued by
the Committee of Sponsoring Organizations of the Treadway Commission.

We have also  audited,  in accordance  with the standards of the Public  Company
Accounting  Oversight  Board  (United  States),   Oak  Hill  Financial,   Inc.'s
consolidated statements of financial condition as of December 31, 2004 and 2003,
and the related  statements  of  earnings,  stockholders'  equity  comprehensive
income and cash flows for each of the three years in the period  ended  December
31, 2004, and our report dated March 17, 2005,  expressed an unqualified opinion
on those financial statements.

GRANT THORNTON LLP


/s/ Grant Thornton LLP

Cincinnati, Ohio
March 17, 2005

Changes in Internal Control
---------------------------

      There have not been any changes in the  Company's  internal  control  over
financial  reporting  during  the  quarter  ended  December  31,  2004 that have
materially  affected,  or  are  reasonably  likely  to  materially  affect,  the
Company's   control  over  financial   reporting.   As  described   above  under
Management's  Report on Internal Control Over Financial  Reporting,  the Company
has  identified  material  weaknesses  in its internal  control  over  financial
reporting.  The Company has made changes to its internal controls over financial
reporting  during the first  quarter  of 2005 as part of its steps to  remediate
such weaknesses.

Item 9B. Other Information

      Effective December 21, 2004, the board of directors of Oak Hill Financial,
Inc. (the "Company")  granted each of the non-employee  directors of the Company
(Barry M. Dorsey,  Candace  DeClark Peace,  Donald R. Seigneur,  William Siders,
Neil S.  Strawser,  H.  Grant  Stephenson,  and  Donald P.  Wood)  options  (the
"Director  Options") to purchase 2,000 shares of the Company's common stock at a
strike price of $37.205 per share,  exercisable  June 15, 2005, and expiring ten
years after the date of grant.

      Effective December 21, 2004, the governance and compensation  committee of
the board of directors  granted R. E.  Coffman,  Jr.,  Ron J.  Copher,  Scott J.
Hinsch,  Jr.,  John D. Kidd,  Bruce D. Knox,  and David G.  Ratz,  options  (the
"Executive Options") to purchase 3,000 shares,  except in the case of Mr. Hincsh
who was granted options to purchase 4,000 shares and Mr. Coffman who was granted
options to purchase  10,000  shares,  of the Company's  common stock at a strike
price of $37.205 per share,  exercisable  June 15, 2005,  and expiring ten years
after the date of grant.

      The  Director  Options  and  Executive  Options  were  granted  under  the
Company's  2004 Stock  Incentive  Plan.  The form of Option  Award  Agreement is
attached as Exhibit 10.1 to this Annual Report on Form 10-K and is  incorporated
herein by reference.

      Effective December 21, 2004, the governance and compensation  committee of
the board of directors  granted 700 shares of restricted  stock (the "Restricted
Stock") to each of Messrs.  Coffman and Copher, such Restricted Stock subject to
vesting on December 21, 2007.  The form of Restricted  Stock Award  Agreement is
attached as Exhibit 10.2 to this Annual Report on Form 10-K and is  incorporated
herein by reference.


                                       33
<PAGE>

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

                                    PART III

Item 10. Directors, Executive Officers, Promoters and Control Persons;
Compliance With Section 16(a) of the Exchange Act.

      The  information  is  contained  under   "Ownership  of  Common  Stock  by
Management"  and "Election of Directors" in the Company's  Proxy Statement dated
March 18, 2005, is incorporated herein by reference in response to this item.

      The  information  contained  under  "Report of the Audit  Committee of the
Board of Directors",  specifically  concerning Audit Committee financial expert,
in the Company's Proxy Statement dated March 18, 2005, is incorporated herein by
reference in response to this item.

      The  information  contained  under  "Compliance  With Section 16(a) of the
Securities  Exchange Act" in the Company's Proxy Statement dated March 18, 2005,
is incorporated herein by reference in response to this item.

      The Company has  adopted a Code of Ethics  that  applies to the  Company's
directors,  officers and employees  including the Company's  principal executive
officer, principal financial officer,  principal accounting officer,  controller
and other persons performing  similar functions.  The Code of Ethics may only be
amended or modified by the Board of  Directors  of the  Company.  Waivers of the
Code of Ethics may only be granted by the Board of  Directors of the Company and
along with reasons for the waiver will be promptly  disclosed as required by the
Securities  Exchange Act of 1934 and the rules thereof and the applicable  rules
of The Nasdaq Stock Market,  Inc. In addition,  amendments and  modifications to
the Code of Ethics will be promptly disclosed to the Company's  shareholders.  A
copy of the Code of Ethics will be provided at no charge upon written request to
Oak Hill  Financial,  Inc.,  Attention:  David  G.  Ratz,  Chief  Administrative
Officer, 14621 S.R. 93, Jackson, Ohio 45640.

Item 11. Executive Compensation.

      The information appearing under "Executive  Compensation" in the Company's
Proxy  Statement  dated March 18, 2005, is  incorporated  herein by reference in
response to this item.

Item 12. Security Ownership of Certain Beneficial Owners and Management and
Related Stockholders Matters.

      The information  appearing  under  "Ownership of Common Stock by Principal
Shareholders",   "Ownership   of  Common  Stock  By   Management"   and  "Equity
Compensation  Plan Information" in the Company's Proxy Statement dated March 18,
2005, is incorporated herein by reference in response to this item.

Item 13. Certain Relationships and Related Transactions.

      The information  appearing under "Certain  Transactions"  in the Company's
Proxy  Statement  dated March 18, 2005, is  incorporated  herein by reference in
response to this item.

Item 14. Principal Accountant Fees and Services

      The information appearing under "Principal  Independent  Registered Public
Accounting  Firm Fees" in the Company's Proxy Statement dated March 18, 2005, is
incorporated herein by reference in response to this item.

                                     PART IV

Item 15. Exhibits and Reports on Form 8-K.

(a) Documents filed as a part of the Report:

      (1)   Report of Grant Thornton LLP, Independent Registered Public
            Accounting Firm

            Consolidated Statements of Financial Condition as of December 31,
            2004 and 2003

            Consolidated Statements of Earnings for years ended December 31,
            2004, 2003 and 2002

            Consolidated Statements of Comprehensive Income for years ended
            December 31, 2004, 2003 and 2002

            Consolidated Statements of Stockholders' Equity for years ended
            December 31, 2004, 2003 and 2002

            Consolidated Statements of Cash Flows for years ended December 31,
            2004, 2003 and 2002

            Notes to Consolidated Financial Statements for years ended December
            31, 2004, 2003 and 2002


                                       34
<PAGE>

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

      (2) Financial Statement Schedules:

                  The information is contained in the Company's Annual Report to
            Stockholders  for the year ended  December 31, 2004 is  incorporated
            herein by reference in response to this item.

      (3)   The  following  are filed as exhibits to this Annual  Report on Form
            10-K:

      Exhibit
      Number

      * 2(a).....................Agreement and Plan of Merger, dated October 12,
                                 2004,  between  Oak Hill  Financial,  Inc.  and
                                 Lawrence Financial Holdings, Inc. (reference is
                                 made  to  Exhibit  2  included  in  Part  I  as
                                 Appendix  A of the  Prospectus/Proxy  Statement
                                 filed by the  Company  on Form  S-4/A  with the
                                 Securities and Exchange  Commission  ("SEC") on
                                 January 6, 2005).

      *2(b)......................Agreement  and Plan of  Merger,  dated July 20,
                                 2004,   between   Oak  Hill  Banks  and  Ripley
                                 National  Bank  (reference  is made to  Exhibit
                                 2(a) of the Current Report filed by the Company
                                 on Form 8-K with the SEC on July 21, 2004).

      *2(c)......................Supplemental  Agreement,  dated July 20,  2004,
                                 between  Oak  Hill  Financial,  Inc.,  Oak Hill
                                 Banks,  and Ripley  National Bank (reference is
                                 made  to  Exhibit  2(b) of the  Current  Report
                                 filed by the  Company  on Form 8-K with the SEC
                                 on July 21, 2004).

      * 2(d).....................Agreement  and Plan of Merger,  dated March 31,
                                 1999,  between  Oak Hill  Financial,  Inc.  and
                                 Towne Financial Corporation  (reference is made
                                 to   Exhibit   2.1  of   the   Prospectus/Proxy
                                 Statement  filed by the  Company  on Form S-4/A
                                 with the SEC on August 3, 1999).

      * 2(e).....................Supplemental  Agreement,  dated as of March 31,
                                 1999,  between  Oak Hill  Financial,  Inc.  and
                                 Towne Financial Corporation  (reference is made
                                 to   Exhibit   2.2  of   the   Prospectus/Proxy
                                 Statement  filed by the  Company  on Form S-4/A
                                 with the SEC on August 3, 1999).

      * 3(a).....................Fourth   Amended  and   Restated   Articles  of
                                 Incorporation  (reference  is made to Form S-4,
                                 Exhibit 3.1, Registration No. 333-81645,  filed
                                 with the SEC on June 25, 1999 and  incorporated
                                 herein by reference).

      * 3(b).....................Restated Code of Regulations (reference is made
                                 to Form SB-2,  Exhibit 3(ii), File No. 33-96216
                                 and incorporated herein by reference).

      *4(a)......................Reference  is made to Articles  FOURTH,  FIFTH,
                                 SEVENTH,  EIGHTH,  TENTH  AND  ELEVENTH  of the
                                 Registrant's Restated Articles of Incorporation
                                 (contained   in   the   Registrant's   Restated
                                 Articles of Incorporation filed as Exhibit 3(a)
                                 hereto) and  Articles  II, III, IV, VI and VIII
                                 of the  Registrant's  Amended and Restated Code
                                 of Regulations  (contained in the  Registrant's
                                 Amended and Restated Code of Regulations  filed
                                 as Exhibit 3(b) hereto).

      *4(b)......................Rights Plan,  dated  January 23, 1998,  between
                                 Oak Hill Financial, Inc., and Fifth Third Bank,
                                 (reference  is made to Exhibit  4.1 to the Form
                                 8-A, filed with the SEC on January 23, 1998 and
                                 incorporated herein by reference).

      *4(c)......................Amended  Rights Plan,  dated December 26, 2000,
                                 between Oak Hill Financial, Inc., and Registrar
                                 and  Transfer  Company,  (reference  is made to
                                 Exhibit 2 to the Form 8-A12B/A,  filed with the
                                 SEC  on  February  21,  2001  and  incorporated
                                 herein by reference).

      *10........................Oak Hill  Financial,  Inc. 2004 Stock Incentive
                                 Plan  (reference  is made to  Appendix 3 to the
                                 Registrant's Definitive Proxy Statement for the
                                 2004  Annual  Meeting of  Shareholders  held on
                                 April 13, 2004, filed with the SEC on March 11,
                                 2004, and incorporated herein by reference).

       10.1......................Form  of  Option  Award   Agreement  under  the
                                 Company's 2004 Stock Incentive Plan.

       10.2......................Form of Restricted  Stock Award Agreement under
                                 the Company's 2004 Stock Incentive Plan.

       13........................2004 Annual Report (Selected portions)

      *14........................Oak Hill Financial, Inc. & Subsidiaries Code of
                                 Ethics


                                       35
<PAGE>

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

      *21........................Subsidiaries  of the  Registrant  (reference is
                                 made  to  Form  SB-2,   Exhibit  21,  File  No.
                                 333-96216    and    incorporated    herein   by
                                 reference).

       23........................Consent  of   Independent   Registered   Public
                                 Accounting Firm, Grant Thornton LLP.

       24........................Powers of Attorney.

       31.1 .....................Certification by Chief Executive Officer, R. E.
                                 Coffman, Jr., dated March 24, 2005, pursuant to
                                 Section 302 of the Sarbanes-Oxley Act of 2002.

       31.2 .....................Certification by Chief Financial  Officer,  Ron
                                 J. Copher,  dated March 24,  2005,  pursuant to
                                 Section 302 of the Sarbanes-Oxley Act of 2002.

       32.1......................Certification by Chief Executive Officer, R. E.
                                 Coffman, Jr., dated March 24, 2005, pursuant to
                                 18 U.S.C.  Section 1350, as adopted pursuant to
                                 Section 906 of the Sarbanes-Oxley Act of 2002

       32.2......................Certification by Chief Financial  Officer,  Ron
                                 J. Copher, dated March 24, 2005, pursuant to 18
                                 U.S.C.  Section  1350,  as adopted  pursuant to
                                 Section 906 of the Sarbanes-Oxley Act of 2002

*Incorporated by reference as indicated.

(b) Form 8-K's Filed:

      1.    Form 8-K,  dated October 9, 2004,  filed with the SEC on October 14,
            2004 announcing the Company and Lawrence  Financial  Holdings,  Inc.
            had signed a Plan of Merger on October  12,  2004.  Also  announcing
            that the Company had completed its previously  announced merger with
            Ripley National Bank on October 9, 2004.

      2.    Form 8-K, dated October 14, 2004,  filed with the SEC on October 18,
            2004  announcing  the Company's  results of operations and financial
            condition for the three and nine months ended September 30, 2004.

      3.    Form 8-K,  dated  January 6, 2005,  filed with the SEC on January 6,
            2005 announcing the Company's sale of the consumer loan portfolio at
            it subsidiary Action Finance Company on December 31, 2004.

      4.    Form 8-K, dated January 13, 2005,  filed with the SEC on January 18,
            2005  announcing  the Company's  results of operations and financial
            condition for the three and twelve months ended December 31, 2004.


                                       36
<PAGE>

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

                                   SIGNATURES

      Pursuant  to the  requirements  of Section  13 or 15(d) of the  Securities
Exchange Act of 1934, the registrant has duly caused this registration statement
to be signed on its behalf by the undersigned, thereunto duly authorized.

                       OAK HILL FINANCIAL, INC.                        Date

                       By: /s/ R. E. Coffman, Jr.                 March 24, 2005
                           -----------------------------------
                           R. E. Coffman, Jr., President and
                           Chief Executive Officer

      Pursuant to the  requirements of the Securities  Exchange Act of 1934, the
report  has  been  signed  below  by the  following  persons  on  behalf  of the
registrant and in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
          Signature                                    Title                                            Date
<S>                                <C>                                                             <C>
*Evan E. Davis                     Director                                                        March 24, 2005
---------------------------

*John D. Kidd                      Chairman & Director                                             March 24, 2005
---------------------------

/s/ R. E. Coffman, Jr.             President, Chief Executive Officer and Director                 March 24, 2005
---------------------------        (Principal Executive Officer)


*David G. Ratz                     Executive Vice President and Chief Administrative Officer       March 24, 2005
---------------------------

*Ron J. Copher                     Chief Financial Officer, Secretary and Treasurer                March 24, 2005
---------------------------        (Principal Financial and Accounting Officer)


*D. Bruce Knox                     Chief Information Officer and Director                          March 24, 2005
---------------------------

*Scott J. Hinsch, Jr.              Vice President                                                  March 24, 2005
---------------------------

*Candice R. DeClark-Peace          Director                                                        March 24, 2005
-------------------------

*Barry M. Dorsey, Ed.D.            Director                                                        March 24, 2005
---------------------------

*Donald R. Seigneur                Director                                                        March 24, 2005
---------------------------

*William S. Siders                 Director                                                        March 24, 2005
---------------------------

*H. Grant Stephenson               Director                                                        March 24, 2005

*Neil S. Strawser                  Director                                                        March 24, 2005
---------------------------

*Donald P. Wood                    Director                                                        March 24, 2005
---------------------------

By: /s/ R. E. Coffman, Jr.                                                                         March 24, 2005
    -----------------------
    R  E. Coffman, Jr.,
    Attorney-in-fact for each
    Of the persons indicated
</TABLE>


                                       37