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

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

   (Mark One)

[X]  QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES  EXCHANGE ACT
     OF 1934

     For the quarterly period ended September 30, 2000

[_]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

     For the transition period from __________ to ____________.

     Commission File Number       0-22223
                                  -------

                      PEOPLES-SIDNEY FINANCIAL CORPORATION
        (Exact name of small business issuer as specified in its charter)

           Delaware                                  31-1499862
           --------                                  ----------
(State or other jurisdiction of                    (IRS Employer
 incorporation or organization)                  Identification No.)

                     101 E. Court Street, Sidney, Ohio 45365
                    ----------------------------------------
                    (Address of principal executive offices)

                                 (937) 492-6129
                           ---------------------------
                           (Issuer's telephone number)

As of November 2, 2000, the latest  practicable  date,  1,570,815  shares of the
issuer's common shares, $.01 par value, were issued and outstanding.

Transitional Small Business Disclosure Format (Check One):

Yes   [X]       No   [_]


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


<PAGE>


                      PEOPLES-SIDNEY FINANCIAL CORPORATION
--------------------------------------------------------------------------------


                                     INDEX
<TABLE>
<CAPTION>
                                                                                Page


PART I - FINANCIAL INFORMATION
<S>                                                                              <C>
  Item 1.   Financial Statements (Unaudited)

            Consolidated Balance Sheets.......................................   3

            Consolidated Statements of Income ................................   4

            Consolidated Statements of Comprehensive Income...................   5

            Condensed Consolidated Statements of Changes in Shareholders'
              Equity..... ....................................................   6

            Consolidated Statements of Cash Flows ............................   7

            Notes to Consolidated Financial Statements .......................   8

  Item 2.   Management's Discussion and Analysis..............................  15


Part II - Other Information

  Item 1.   Legal Proceedings.................................................  20

  Item 2.   Changes in Securities and Use of Proceeds.........................  20

  Item 3.   Defaults Upon Senior Securities...................................  20

  Item 4.   Submission of Matters to a Vote of Security Holders...............  20

  Item 5.   Other Information.................................................  20

  Item 6.   Exhibits and Reports on Form 8-K..................................  20


SIGNATURES ...................................................................  21
</TABLE>

                                       2
<PAGE>


                      PEOPLES-SIDNEY FINANCIAL CORPORATION

                           CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)

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


Item 1.  Financial Statements

<TABLE>
<CAPTION>
                                                                            September 30,                 June 30,
                                                                                2000                        2000
                                                                                ----                        ----
ASSETS

<S>                                                                    <C>                        <C>
Cash and due from financial institutions                               $           1,013,978      $             820,629
Interest-bearing deposits in other financial institutions                            863,075                    885,364
Overnight deposits                                                                 1,400,000                    500,000
                                                                       ---------------------      ---------------------
      Total cash and cash equivalents                                              3,277,053                  2,205,993
Securities available for sale                                                      8,451,368                  8,446,681
Federal Home Loan Bank stock                                                       1,220,300                  1,023,000
Loans, net                                                                       117,225,203                114,649,700
Accrued interest receivable                                                          959,221                    893,569
Premises and equipment, net                                                        1,874,785                  1,890,886
Other assets                                                                         135,147                    177,387
                                                                       ---------------------      ---------------------

      Total assets                                                     $         133,143,077      $         129,287,216
                                                                       =====================      =====================


LIABILITIES
Deposits                                                               $          91,788,696      $          93,056,941
Borrowed funds                                                                    24,000,000                 19,000,000
Accrued interest payable and other liabilities                                       255,336                    270,477
                                                                       ---------------------      ---------------------
      Total liabilities                                                          116,044,032                112,327,418

SHAREHOLDERS' EQUITY
Preferred stock, $.01 par value, 500,000 shares
  authorized, none issued and outstanding
Common stock, $.01 par value, 3,500,000 shares
  authorized, 1,785,375 shares issued                                                 17,854                     17,854
Additional paid-in capital                                                        10,739,848                 10,754,463
Retained earnings                                                                 10,915,946                 10,856,394
Treasury stock, 214,560 and 207,060 shares, at cost                               (2,694,420)                (2,636,295)
Unearned employee stock ownership plan shares                                     (1,306,476)                (1,347,800)
Unearned management recognition plan shares                                         (508,385)                  (556,043)
Accumulated other comprehensive income (loss)                                        (65,322)                  (128,775)
                                                                       ---------------------      ---------------------
      Total shareholders' equity                                                  17,099,045                 16,959,798
                                                                       ---------------------      ---------------------

      Total liabilities and shareholders' equity                       $         133,143,077      $         129,287,216
                                                                       =====================      =====================
</TABLE>

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

          See accompanying notes to consolidated financial statements.

                                       3
<PAGE>

                      PEOPLES-SIDNEY FINANCIAL CORPORATION

                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)

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

<TABLE>
<CAPTION>
                                                                                        Three Months Ended
                                                                                           September 30,
                                                                                           -------------
                                                                                   2000                     1999
                                                                                   ----                     ----
Interest income
<S>                                                                       <C>                       <C>
      Loans, including fees                                               $          2,295,051      $         2,007,976
      Securities                                                                       149,426                  130,145
      Demand, time and overnight deposits                                               13,451                   40,860
      Dividends on Federal Home Loan Bank stock                                         20,400                   16,587
                                                                          --------------------      -------------------
            Total interest income                                                    2,478,328                2,195,568

Interest expense
      Deposits                                                                       1,189,597                1,011,861
      Borrowed funds                                                                   346,955                  250,789
                                                                          --------------------      -------------------
            Total interest expense                                                   1,536,552                1,262,650
                                                                          --------------------      -------------------

Net interest income                                                                    941,776                  932,918

Provision for loan losses                                                               18,747                   17,301
                                                                          --------------------      -------------------

Net interest income after provision for loan losses                                    923,029                  915,617

Noninterest income
      Service fees and other charges                                                    27,915                   22,733

Noninterest expense
      Compensation and benefits                                                        376,773                  364,425
      Director fees                                                                     30,000                   30,000
      Occupancy and equipment                                                           80,914                   77,707
      Computer processing expense                                                       56,527                   47,479
      FDIC deposit insurance premiums                                                    4,792                   12,203
      State franchise taxes                                                             44,725                   75,323
      Professional fees                                                                 25,602                   29,477
      Other                                                                             69,818                   77,669
                                                                          --------------------      -------------------
            Total noninterest expense                                                  689,151                  714,283
                                                                          --------------------      -------------------

Income before income taxes                                                             261,793                  224,067

Income tax expense                                                                      99,800                   92,816
                                                                          --------------------      -------------------

Net income                                                                $            161,993      $           131,251
                                                                          ====================      ===================

Earnings per common share - basic                                         $               0.11      $              0.09
                                                                          ====================      ===================

Earnings per common share - diluted                                       $               0.11      $              0.09
                                                                          ====================      ===================
</TABLE>

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

          See accompanying notes to consolidated financial statements.

                                      4

<PAGE>

                      PEOPLES-SIDNEY FINANCIAL CORPORATION

                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                                   (Unaudited)

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

<TABLE>
<CAPTION>
                                                                           Three Months Ended
                                                                              September 30,
                                                                              -------------
                                                                      2000                     1999
                                                                      ----                     ----
<S>                                                          <C>                       <C>
Net income                                                   $            161,993      $           131,251

Other comprehensive income (loss)
      Unrealized holding gains and (losses) on
        available-for-sale securities                                      96,141                  (42,531)
      Tax effect                                                          (32,688)                  14,460
                                                             --------------------      -------------------
            Other comprehensive income (loss)                              63,453                  (28,071)
                                                             --------------------      -------------------

Comprehensive income                                         $            225,446      $           103,180
                                                             ====================      ===================
</TABLE>


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

          See accompanying notes to consolidated financial statements.

                                      5

<PAGE>

                      PEOPLES-SIDNEY FINANCIAL CORPORATION

                 CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN
                              SHAREHOLDERS' EQUITY
                                   (Unaudited)

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

<TABLE>
<CAPTION>
                                                                                                  Three Months
                                                                                               Ended September 30,
                                                                                               -------------------
                                                                                       2000                       1999
                                                                                       ----                       ----
<S>                                                                           <C>                        <C>
Balance, beginning of period                                                  $          16,959,798      $          17,362,217

Net income for period                                                                       161,993                    131,251

Cash dividends, $.07 per share in 2000 and 1999                                            (102,442)                  (107,455)

Purchase of 7,500 shares of treasury stock in 2000, at cost                                 (58,125)                        --

Commitment to release 2,856 management recognition plan
  shares in 2000 and 1999                                                                    47,658                     47,658

Commitment to release 3,522 and 3,671 employee stock ownership
  plan shares in 2000 and 1999, at fair value                                                26,710                     39,251

Change in fair value on securities available for sale, net of tax                            63,453                    (28,071)
                                                                              ---------------------      ---------------------

Balance, end of period                                                        $          17,099,045      $          17,444,851
                                                                              =====================      =====================
</TABLE>

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

          See accompanying notes to consolidated financial statements.

                                       6
<PAGE>

                      PEOPLES-SIDNEY FINANCIAL CORPORATION

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                                                      Three Months Ended
                                                                                         September 30,
                                                                                         -------------
                                                                                2000                     1999
                                                                                ----                     ----
Cash flows from operating activities
<S>                                                                     <C>                       <C>
      Net income                                                        $           161,993       $          131,251
      Adjustments to reconcile net income to net cash from
        operating activities
            Depreciation                                                             39,130                   38,204
            Provision for loan losses                                                18,747                   17,301
            FHLB stock dividends                                                    (20,300)                 (16,500)
            Compensation expense for ESOP shares                                     26,710                   39,251
            Compensation expense for MRP shares                                      47,658                   47,658
            Change in
                  Accrued interest receivable and other assets                      (24,789)                   8,447
                  Accrued expense and other liabilities                             (47,829)                 (74,351)
                  Deferred loan fees                                                  3,252                    8,414
                                                                       --------------------      -------------------
                        Net cash from operating activities                          204,572                  199,675

Cash flows from investing activities
      Purchases of securities available for sale                                         --               (1,000,000)
      Principal repayments on mortgage-backed securities                             92,831                   35,321
      Purchases of time deposits in other financial institutions                         --               (1,000,000)
      Net increase in loans                                                      (2,597,502)              (3,007,985)
      Premises and equipment expenditures                                           (23,029)                 (16,630)
      Purchases of FHLB stock                                                      (177,000)                      --
                                                                       --------------------      -------------------
            Net cash from investing activities                                   (2,704,700)              (4,989,294)

Cash flows from financing activities
      Net change in deposits                                                     (1,268,245)               3,896,491
      Net change in short-term borrowings                                                --               (2,800,000)
      Proceeds from long-term borrowings                                          5,000,000                5,000,000
      Cash dividends paid                                                          (102,442)                (107,455)
      Purchase of treasury stock                                                    (58,125)                      --
                                                                       --------------------      -------------------
            Net cash from financing activities                                    3,571,188                5,989,036
                                                                       --------------------      -------------------

Net change in cash and cash equivalents                                           1,071,060                1,199,417

Cash and cash equivalents at beginning of period                                  2,205,993                1,932,978
                                                                       --------------------      -------------------

Cash and cash equivalents at end of period                             $          3,277,053      $         3,132,395
                                                                       ====================      ===================

Supplemental disclosures of cash flow information
      Cash paid during the period for
            Interest                                                   $          1,524,156      $         1,260,290
            Income taxes                                                             25,000                   65,000
</TABLE>

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

          See accompanying notes to consolidated financial statements.

                                       7
<PAGE>


                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

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

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The  accompanying   consolidated   financial   statements  include  accounts  of
Peoples-Sidney   Financial   Corporation   ("Peoples")   and  its   wholly-owned
subsidiary,  Peoples Federal  Savings and Loan  Association  ("Association"),  a
federal  stock  savings  and  loan  association,  together  referred  to as  the
Corporation.  All significant  intercompany  transactions and balances have been
eliminated.

These interim  consolidated  financial statements are prepared without audit and
reflect all adjustments  which,  in the opinion of management,  are necessary to
present fairly the financial  position of the  Corporation at September 30, 2000
and its results of operations and cash flows for the periods presented. All such
adjustments are normal and recurring in nature.  The  accompanying  consolidated
financial  statements have been prepared in accordance with the  instructions of
Form  10-QSB  and,  therefore,  do not  purport  to  contain  all the  necessary
financial  disclosures required by generally accepted accounting principles that
might  otherwise  be  necessary  in the  circumstances,  and  should  be read in
conjunction with the consolidated  financial statements and notes thereto of the
Corporation for the fiscal year ended June 30, 2000, included in its 2000 Annual
Report.  Reference  is  made  to the  accounting  policies  of  the  Corporation
described in the notes to  consolidated  financial  statements  contained in its
2000 Annual Report. The Corporation has consistently  followed these policies in
preparing this Form 10-QSB.

The Corporation  provides  financial services through its main office in Sidney,
Ohio, and branch offices in Anna and Jackson  Center,  Ohio. Its primary deposit
products are checking,  savings and term certificate  accounts,  and its primary
lending  products are residential  mortgage,  commercial and installment  loans.
Substantially  all loans are secured by specific  items of collateral  including
business assets, consumer assets and real estate.  Commercial loans are expected
to be repaid from cash flow from operations of businesses. Real estate loans are
secured by both  residential  and  commercial  real  estate.  Substantially  all
revenues  and  services  are derived  from  financial  institution  products and
services in Shelby  County and  contiguous  counties.  Management  considers the
Corporation to operate in one segment, banking.

To prepare financial statements in conformity with generally accepted accounting
principles,  management  makes  estimates  and  assumptions  based on  available
information.  These estimates and assumptions affect the amounts reported in the
financial statements and disclosures provided,  and future results could differ.
The allowance for loan losses,  fair values of financial  instruments and status
of contingencies are particularly subject to change.

Income tax expense is based on the  effective tax rate expected to be applicable
for the entire year.  Income tax expense is the total of the current year income
tax due or  refundable  and the change in deferred  tax assets and  liabilities.
Deferred tax assets and  liabilities are the expected future tax amounts for the
temporary  differences  between the carrying amounts and tax basis of assets and
liabilities, computed using enacted tax rates. A valuation allowance, if needed,
reduces deferred tax assets to the amount expected to be realized.

Basic  earnings per share ("EPS") is based on net income divided by the weighted
average  number of  shares  outstanding  during  the  period.  ESOP  shares  are
considered   outstanding  for  this  calculation  unless  unearned.   Management
recognition  plan  ("MRP")  shares are  considered  outstanding  as they  become
vested.  Diluted EPS shows the dilutive  effect of MRP shares and the additional
common shares issuable under stock options.

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

                                  (Continued)

                                       8
<PAGE>

                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

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


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

A reconciliation  of the numerators and denominators  used in the computation of
the basic  earnings  per common  share and diluted  earnings per common share is
presented below:

<TABLE>
<CAPTION>
                                                                                    Three Months Ended
                                                                                       September 30,
                                                                                 2000                 1999
                                                                                 ----                 ----
Basic Earnings Per Common Share
      Numerator
<S>                                                                        <C>                  <C>
         Net income                                                        $       161,993      $       131,251
                                                                           ===============      ===============
      Denominator
         Weighted average common shares outstanding                              1,577,826            1,664,622
         Less:  Average unallocated ESOP shares                                   (113,103)            (127,716)
         Less:  Average unearned MRP shares                                        (31,894)             (43,319)
                                                                           ---------------      ---------------
         Weighted average common shares outstanding for
           basic earnings per common share                                       1,432,829            1,493,587
                                                                           ===============      ===============

      Basic earnings per common share                                      $         0.11       $         0.09
                                                                           ==============       ==============

Diluted Earnings Per Common Share
      Numerator
         Net income                                                        $       161,829      $       131,251
                                                                           ===============      ===============
      Denominator
         Weighted average common shares outstanding for
           basic earnings per common share                                       1,432,829            1,493,587
         Add:  Dilutive effects of average unearned MRP shares                          --                   --
         Add:  Dilutive effects of assumed exercises of stock options                   --                   --
                                                                           ---------------      ---------------
         Weighted average common shares and dilutive
           potential common shares outstanding                                   1,432,829            1,493,587
                                                                           ===============      ===============

      Diluted earnings per common share                                    $         0.11       $         0.09
                                                                           ==============       ==============
</TABLE>

Unearned MRP shares and stock options  granted did not have a dilutive effect on
EPS for the three months ended  September 30, 2000 and 1999 as the fair value of
the MRP  shares  on the  date of grant  and the  exercise  price of  outstanding
options  was  greater  than the  average  market  price  for the  period.  As of
September 30, 2000 and 1999, there were 140,824 and 141,824 options  outstanding
that were not dilutive.

Statement of Financial  Accounting  Standards  (SFAS) No. 133,  "Accounting  for
Derivative  Instruments  and Hedging  Activities"  requires  companies to record
derivatives  on the  balance  sheet as assets or  liabilities,  measured at fair
value. Gains or losses resulting from changes in the values of those derivatives
would be accounted  for  depending on the use of the  derivative  and whether it
qualifies for hedge  accounting.  The key criterion for hedge accounting is that
the  hedging  relationship  must be highly  effective  in  achieving  offsetting
changes  in fair  value or cash  flows.  SFAS 133 does not  allow  hedging  of a
security that is classified as held to maturity.  Accordingly,  upon adoption of
SFAS 133,  companies  may  reclassify  any  security  from held to  maturity  to
available  for sale if they wish to be able to hedge the security in the future.
SFAS 133, as deferred by SFAS 137 and  amended by SFAS 138,  was  effective  for
fiscal years  beginning  after June 15,  2000.  The adoption of SFAS 133 did not
have a significant impact on the Corporation's financial statements.


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

                                  (Continued)

                                       9
<PAGE>

                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

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

NOTE 2 - SECURITIES AVAILABLE FOR SALE

Securities available for sale were as follows:

<TABLE>
<CAPTION>
                                                                  Gross                Gross                 Estimated
                                           Amortized           Unrealized           Unrealized                 Fair
                                             Cost                 Gains               Losses                   Value
                                             ----                 -----               ------                   -----
September 30, 2000
<S>                                  <C>                      <C>                 <C>                  <C>
     U.S. Government agencies        $         3,996,942      $           --      $       (68,042)     $         3,928,900
     Mortgage-backed securities                4,553,399                  --              (30,931)               4,522,468
                                     -------------------      --------------      ---------------      -------------------

         Total                       $         8,550,341      $           --      $       (98,973)     $         8,451,368
                                     ===================      ==============      ===============      ===================

June 30, 2000
     U.S. Government agencies        $         3,996,736      $           --      $      (100,336)     $         3,896,400
     Mortgage-backed securities                4,645,059                  --              (94,778)               4,550,281
                                     -------------------      --------------      ---------------      -------------------

         Total                       $         8,641,795      $           --      $      (195,114)     $         8,446,681
                                     ===================      ==============      ===============      ===================
</TABLE>

Contractual  maturities of  securities  available for sale at September 30, 2000
were as  follows.  Actual  maturities  may differ  from  contractual  maturities
because  borrowers  may have the  right to call or  prepay  obligations  with or
without call or prepayment  penalties.  Securities not due at a single maturity,
primarily mortgage-backed securities, are shown separately.

<TABLE>
<CAPTION>
                                                                            Estimated
                                                   Amortized                  Fair
                                                     Cost                     Value
                                                     ----                     -----

<S>                                         <C>                       <C>
  Due after one year through five years     $          2,998,984      $         2,941,560
  Due after five years through ten years                 997,958                  987,340
  Mortgage-backed securities                           4,553,399                4,522,468
                                            --------------------      -------------------

                                            $          8,550,341      $         8,451,368
                                            ====================      ===================
</TABLE>

No securities were sold during the three-month  periods ended September 30, 2000
and 1999. No securities were pledged as collateral at September 30, 2000 or June
30, 2000.

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

                                  (Continued)

                                       10

<PAGE>


                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

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

NOTE 3 - LOANS

Loans were as follows:

<TABLE>
<CAPTION>
                                                 September 30,               June 30,
                                                     2000                      2000
                                                     ----                      ----
   Mortgage loans:
         <S>                                 <C>                      <C>
         1-4 family residential              $          94,270,706    $          92,116,695
         Multi-family residential                        1,285,605                1,300,151
         Commercial real estate                         10,401,256               10,047,775
         Real estate construction and
           development                                   6,904,886                8,088,290
         Land                                            1,047,102                  991,864
                                             ---------------------    ---------------------
               Total mortgage loans                    113,909,555              112,544,775
   Consumer loans                                        4,112,278                3,571,071
   Commercial loans                                      2,714,836                2,406,064
                                             ---------------------    ---------------------
               Total loans                             120,736,669              118,521,910
   Less:
         Allowance for loan losses                        (605,600)                (591,350)
         Loans in process                               (2,657,302)              (3,035,548)
         Deferred loan fees                               (248,564)                (245,312)
                                             ---------------------    ---------------------

                                             $         117,225,203    $         114,649,700
                                             =====================    =====================
</TABLE>

Activity in the allowance for loan losses is summarized as follows:

                                             Three Months Ended
                                                September 30,
                                                -------------
                                           2000                1999
                                           ----                ----

   Balance at beginning of period   $        591,350     $        528,898
   Provision for losses                       18,747               17,301
   Charge-offs                                (4,563)                  --
   Recoveries                                     66                   --
                                    ----------------     ----------------

   Balance at end of period         $        605,600     $        546,199
                                    ================     ================

Nonperforming loans were as follows:

                                                  September 30,       June 30,
                                                      2000              2000
                                                      ----              ----

   Loans past due over 90 days still on accrual   $    401,000    $    289,000
   Nonaccrual loans                                    902,000         756,000

Non-performing   loans  include  smaller  balance  homogeneous  loans,  such  as
residential  mortgage and consumer  loans that are  collectively  evaluated  for
impairment.

As of  September  30,  2000 and June 30,  2000 and for the  three  months  ended
September  30,  2000 and  1999,  no loans  were  required  to be  evaluated  for
impairment on an individual loan basis within the scope of SFAS No. 114.

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

                                  (Continued)

                                       11
<PAGE>


NOE 4 - BORROWED FUNDS

At September 30, 2000 and June 30, 2000, the  Association  had a cash management
line of credit enabling it to borrow up to $8,000,000 from the Federal Home Loan
Bank of  Cincinnati  ("FHLB").  All cash  management  advances  have an original
maturity of 90 days.  The line of credit must be renewed on an annual basis.  No
borrowings  were  outstanding  on this line of credit at September  30, 2000 and
June 30, 2000.

Based on the FHLB stock owned by the  Association  at September  30,  2000,  the
Association  has the  ability  to obtain  borrowings  up to a  maximum  total of
$24,406,000,   including  the  cash  management  line-of-credit.   However,  the
Association  can  obtain  advances  up to the lower of 50% of the  Association's
total assets or 80% of the  Association's  pledgable  residential  mortgage loan
portfolio by  purchasing  more FHLB stock.  Advances  from the Federal Home Loan
Bank at September 30, 2000 and June 30, 2000 were as follows:

<TABLE>
<CAPTION>
                                                                      September 30,                June 30,
                                                                          2000                       2000
                                                                          ----                       ----
    <S>                                                        <C>                        <C>
     7.15% FHLB fixed-rate advance, due May 2, 2001             $           2,500,000      $           2,500,000
     7.41% FHLB fixed-rate advance, due May 15, 2001                        2,000,000                  2,000,000
     7.40% FHLB fixed-rate advance, due May 2, 2002                         2,500,000                  2,500,000
     6.13% FHLB fixed-rate advance, due June 25, 2008                       7,000,000                  7,000,000
     6.00% FHLB fixed-rate advance, due June 11, 2009                       5,000,000                  5,000,000
     6.27% FHLB fixed-rate advance, due September 8, 2010                   5,000,000                         --
                                                                ---------------------      ---------------------
                                                                $          24,000,000      $          19,000,000
                                                                =====================      =====================
</TABLE>

Advances under the borrowing  agreements are  collateralized by a blanket pledge
of the Association's residential mortgage loan portfolio and its FHLB stock.

NOTE 5 - OFF-BALANCE-SHEET ACTIVITIES

Some financial instruments,  such as loan commitments,  credit lines, letters of
credit and overdraft  protection,  are issued to meet customer  financing needs.
These are  agreements to provide  credit or to support the credit of others,  as
long as  conditions  established  in the  contract  are met,  and  usually  have
expiration dates.  Commitments may expire without being used.  Off-balance-sheet
risk to credit loss exists up to the face amount of these instruments,  although
material losses are not  anticipated.  The same credit policies are used to make
such  commitments  as are used for  loans,  including  obtaining  collateral  at
exercise of the commitment.

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

                                  (Continued)

                                       12

<PAGE>

                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

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

NOTE 5 - OFF-BALANCE-SHEET ACTIVITIES (Continued)

The contractual amount of financial instruments with  off-balance-sheet risk was
as follows:

<TABLE>
<CAPTION>
                                      September 30,                              June 30,
                                          2000                                     2000
                                          ----                                     ----
                                   Fixed            Variable              Fixed            Variable
                                   Rate               Rate                Rate               Rate
                                   ----               ----                ----               ----
<S>                            <C>               <C>                 <C>                <C>
  Nonresidential               $    249,000      $         --        $         --       $         --
  Residential real estate            40,000           378,000              15,000            879,000
  Interest rates                 8.50-10.00%             9.00%               9.00%         8.25-9.50%
</TABLE>

Commitments  to make loans are  generally  made for a period of 30 days or less.
Maturities for fixed-rate loan commitments range from 10 years to 20 years.

The  Corporation  also had unused  commercial  and home  equity  lines of credit
approximating $2,290,000 and $2,200,000 at September 30, 2000 and June 30, 2000.

At September 30, 2000 and June 30, 2000,  the  Association  was required to have
$306,000 and $419,000 on deposit with its correspondent  banks as a compensating
clearing requirement.

The Association entered into employment  agreements with certain officers of the
Corporation.  The  agreements  provide  for a term of one to three  years  and a
salary  and  performance  review by the Board of  Directors  not less often than
annually,  as well as  inclusion  of the  employee in any  formally  established
employee benefit,  bonus,  pension and profit-sharing plans for which management
personnel are eligible.  The  agreements  provide for extensions for a period of
one year on each annual  anniversary date, subject to review and approval of the
extension by disinterested members of the Board of Directors of the Association.
The employment agreements also provide for vacation and sick leave.

NOTE 6 - EMPLOYEE STOCK OWNERSHIP PLAN

The Corporation offers an employee stock ownership plan ("ESOP") for the benefit
of substantially all employees of the Corporation. The ESOP received a favorable
determination  letter from the Internal  Revenue Service on the qualified status
of the ESOP under  applicable  provisions of the Internal Revenue Code. The ESOP
borrowed  funds from Peoples in order to acquire  common shares of Peoples.  The
loan is secured  by the  shares  purchased  with the loan  proceeds  and will be
repaid by the ESOP with funds from the Association's discretionary contributions
to the ESOP and earnings on ESOP assets.  All  dividends on  unallocated  shares
received by the ESOP are used to pay debt service.  When loan payments are made,
ESOP shares are allocated to participants based on relative compensation.

During  fiscal  1998,  the  Corporation  declared  and  paid a $4.00  per  share
distribution of which $3.99 was a tax-free return of capital  distribution.  The
ESOP  received  approximately  $539,000 on 134,262  unallocated  shares from the
return of capital  distribution.  The ESOP used the proceeds to purchase  26,000
additional  shares.  The additional shares are held in suspense and allocated to
participants  in a manner  similar to the shares  originally  in the ESOP.  ESOP
compensation  expense  was  $26,710  and  $39,251  for the  three  months  ended
September 30, 2000 and 1999.

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

                                  (Continued)

                                       13
<PAGE>

                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

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

NOTE 6 - EMPLOYEE STOCK OWNERSHIP PLAN (Continued)

ESOP shares as of September 30, 2000 and June 30, 2000 were as follows:

<TABLE>
<CAPTION>
                                                                 September 30,                June 30,
                                                                     2000                       2000
                                                                     ----                       ----
<S>                                                                    <C>                       <C>
         Allocated shares                                              53,966                    53,966
         Shares committed to be released for allocation                 3,522                        --
         Unreleased shares                                            111,342                   114,864
                                                          -------------------      --------------------

               Total ESOP shares                                      168,830                   168,830
                                                          ===================      ====================

         Fair value of unreleased shares                  $           862,900      $            976,344
                                                          ===================      ====================
</TABLE>

NOTE 7 - STOCK OPTION AND INCENTIVE PLAN

The Stock  Option and  Incentive  Plan was approved by the  shareholders  of the
Corporation  on May 22,  1998.  The Board of  Directors  has granted  options to
purchase  shares of common  stock at an exercise  price  ranging  from $16.01 to
$18.75 to certain  employees,  officers and  directors of the  Corporation.  The
exercise price for options  granted prior to June 10, 1998,  were reduced by the
$3.99 return of capital  distribution.  One-fifth of the options  awarded become
first exercisable on each of the first five  anniversaries of the date of grant.
The option period expires 10 years from the date of grant.  140,824 options were
outstanding  at  September  30,  2000 and June 30,  2000.  56,330  options  were
exercisable at September 30, 2000 and June 30, 2000. In addition, 37,714 options
to purchase  common stock are reserved for future  grants at September  30, 2000
and June 30, 2000.

NOTE 8 - MANAGEMENT RECOGNITION PLAN

A Management  Recognition Plan ("MRP") was adopted by the Board of Directors and
approved  by the  shareholders  of the  Corporation  on May 22, 1998 to purchase
71,415  common  shares,  which  is  equal  to 4% of the  common  shares  sold in
connection  with the  conversion.  The MRP will be used as a means of  providing
directors  and  certain  key  employees  of the  Corporation  with an  ownership
interest in the  Corporation in a manner  designed to compensate  such directors
and key employees for services to the Corporation.

In  conjunction  with the  adoption  of the MRP on May 22,  1998,  the  Board of
Directors awarded 57,128 shares to certain directors,  officers and employees of
the Corporation. No shares had been previously awarded. One-fifth of such shares
will be earned and nonforfeitable on each of the first five anniversaries of the
date of the award.  At September 30, 2000 and June 30, 2000,  22,854 shares have
vested.  In the event of the death or disability of a participant or a change in
control of the Corporation,  however,  the  participant's  shares will be deemed
earned and  nonforfeitable  upon such date.  At September  30, 2000 and June 30,
2000,  there were 14,287 shares  reserved for future awards and held as treasury
stock.  Compensation expense related to MRP shares is based upon the cost of the
shares, which approximates fair value at the date of grant. For the three months
ended September 30, 2000 and 1999, compensation expense totaled $47,658.

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

                                  (Continued)

                                       14

<PAGE>


                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

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

Item 2.  Management's Discussion and Analysis

Introduction

In the  following  pages,  management  presents an analysis of the  consolidated
financial condition of Peoples-Sidney  Financial Corporation (the "Corporation")
as of September 30, 2000,  compared to June 30, 2000,  and results of operations
for the three months ended September 30, 2000,  compared with the same period in
1999.  This  discussion  is designed to provide a more  comprehensive  review of
operating  results  and  financial  position  than  could  be  obtained  from an
examination of the financial  statements  alone. This analysis should be read in
conjunction with the interim financial statements and related footnotes included
herein.

When used in this  discussion  or future  filings  by the  Corporation  with the
Securities   and   Exchange   Commission,   or  other   public  or   shareholder
communications,  or in oral  statements  made with the approval of an authorized
executive officer, the words or phrases "will likely result," "are expected to,"
"will continue," "is anticipated,"  "estimate,"  "project," "believe" or similar
expressions  are intended to identify  "forward-looking  statements"  within the
meaning of the Private Securities Litigation Reform Act of 1995. The Corporation
wishes  to  caution   readers   not  to  place   undue   reliance  on  any  such
forward-looking statements,  which speak only as of the date made, and to advise
readers  that  various  factors,   including   regional  and  national  economic
conditions,  changes in levels of market interest rates, credit risks of lending
activities   and   competitive   and  regulatory   factors,   could  affect  the
Corporation's  financial  performance and could cause the  Corporation's  actual
results  for future  periods to differ  materially  from  those  anticipated  or
projected.

The Corporation is not aware of any trends,  events or  uncertainties  that will
have or are  reasonably  likely  to have a  material  effect  on its  liquidity,
capital resources or operations  except as discussed herein.  The Corporation is
not aware of any current  recommendations  by regulatory  authorities that would
have such effect if implemented.

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

Financial Condition

Total  assets at  September  30,  2000 were  $133.1  million  compared to $129.3
million at June 30, 2000, an increase of $3.8 million,  or 3.0%. The increase in
total assets was due to increases in loans and cash and cash equivalents  funded
by proceeds from increased borrowings.

Loans  increased  $2.6  million  from $114.6  million at June 30, 2000 to $117.2
million at September 30, 2000. The increase was primarily in one- to four-family
residential  loans which increased $2.2 million.  Real estate  construction  and
development  loans  decreased  $1.2  million due to  conversion  into  permanent
one-to-four  family  loans.  Changes in other types of  mortgage  loans were not
significant.  The overall  increase in total  mortgage  loans is reflective of a
strong local economy coupled with attractive loan rates and products compared to
local competition. Expansion into new market areas through the Association's two
new branch banking facilities also contributed to the growth.

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

                                  (Continued)

                                       15

<PAGE>


                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

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

The Corporation's  consumer loan portfolio  increased  $541,000 between June 30,
2000 and  September  30, 2000.  The  increase  was spread  evenly among loans on
deposit accounts, single payment personal notes and automobile loans. Commercial
loans increased $309,000 as the Corporation has gradually increased the emphasis
on this type of lending.  Even with the increases,  non-mortgage  loans remain a
small portion of the entire loan portfolio and represented only 5.7% and 5.0% of
gross loans at September 30, 2000 and June 30, 2000.

Cash and cash  equivalents  increased  $1.1  million,  primarily  as a temporary
earning source until loan growth utilizes all the funds provided from additional
long-term borrowings.

Total  deposits  decreased  $1.3 million from $93.1  million at June 30, 2000 to
$91.8  million at  September  30,  2000.  The  decrease,  which was  expected by
management,  was  primarily  due to a large  jumbo  certificate  of deposit  for
$901,000,  which matured and was withdrawn.  NOW accounts increased $322,000 and
savings  accounts  declined  $877,000 since June 30, 2000. Money market accounts
and noninterest-bearing demand deposits had little change since June 30, 2000.

Borrowed  funds were $24.0  million at  September  30,  2000  compared  to $19.0
million at June 30, 2000. Borrowings at September 30, 2000 consisted entirely of
long-term  fixed-rate  advances.  The additional  borrowings  were taken to fund
ongoing  loan demand and replace the jumbo  certificate  of deposit  withdrawal.
Based on the FHLB stock owned by the  Association  at September  30,  2000,  the
Association  had the  ability  to obtain  borrowings  up to a  maximum  total of
$24,406,000. However, the Association can obtain advances up to the lower of 50%
of  the  Association's  total  assets  or 80%  of  the  Association's  pledgable
residential  mortgage loan portfolio by purchasing  more FHLB stock.  Based upon
the 50% of total assets limitation,  management  estimates the maximum borrowing
capacity from the FHLB to be approximately $66,500,000 at September 30, 2000.

Results of Operations

The  operating  results of the  Corporation  are  affected  by general  economic
conditions,  monetary and fiscal  policies of federal  agencies  and  regulatory
policies of agencies that regulate  financial  institutions.  The  Corporation's
cost of funds is  influenced  by interest  rates on  competing  investments  and
general  market rates of interest.  Lending  activities are influenced by demand
for real  estate  loans and other  types of loans,  which in turn is affected by
interest  rates at which such loans are made,  general  economic  conditions and
availability of funds for lending activities.

The Corporation's net income primarily depends on its net interest income, which
is the difference  between  interest income earned on  interest-earning  assets,
such as loans and securities and interest expense  incurred on  interest-bearing
liabilities,  such as deposits and borrowings.  The level of net interest income
is dependent on the interest  rate  environment  and volume and  composition  of
interest-earning  assets and  interest-bearing  liabilities.  Net income is also
affected by provisions for loan losses,  service  charges,  gains on the sale of
assets and other income, noninterest expense and income taxes.

Net Income.  The Corporation  earned net income of $162,000 for the three months
ended  September  30,  2000  compared  to $131,000  for the three  months  ended
September 30, 1999.  The increase in net income was primarily due to an increase
in net interest income and a decrease in noninterest expense.

Net Interest  Income.  Net interest income totaled $942,000 for the three months
ended  September  30,  2000  compared  to $933,000  for the three  months  ended
September  30, 1999.  The increase was the result of higher  income on loans and
securities  partially  offset by an increase in interest expense on deposits and
borrowings.


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

                                  (Continued)


                                       16
<PAGE>


                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

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

Interest and fees on loans increased $287,000,  or 14.3% from $2,008,000 for the
three months ended  September 30, 1999 to $2,295,000  for the three months ended
September 30, 2000. The increase in interest  income was due to a higher average
balance of loans coupled with an increase in the yield earned on loans.

Interest  earned on  securities  increased  $19,000 for the three  months  ended
September  30,  2000 as  compared  to the same  period  in the prior  year.  The
increase was the result of having a higher yield than a year ago.

Interest  paid on  deposits  increased  $178,000  for  the  three  months  ended
September  30, 2000 compared to the three months ended  September 30, 1999.  The
increase resulted from an increase in the average rate paid on deposits combined
with an increase in the average balance of deposits.

Interest  paid on borrowed  funds  totaled  $347,000  for the three months ended
September 30, 2000 compared to $251,000 for the three ended  September 30, 1999.
The  increase  in  interest  expense on borrowed  funds  resulted  from a higher
average balance of borrowed funds combined with an increase in the rate paid for
borrowings.

Provision  for Loan Losses.  The  Corporation  maintains  an allowance  for loan
losses in an amount  that,  in  management's  judgment,  is  adequate  to absorb
probable  losses  in the loan  portfolio.  While  management  utilizes  its best
judgment and information  available,  the ultimate  adequacy of the allowance is
dependent  upon  a  variety  of  factors,   including  the  performance  of  the
Corporation's  loan  portfolio,  the economy,  changes in real estate values and
interest  rates  and  the  view  of  the  regulatory   authorities  toward  loan
classifications.  The  provision  for loan losses is determined by management as
the amount to be added to the  allowance  for loan losses after net  charge-offs
have been deducted to bring the allowance to a level that is considered adequate
to absorb probable losses in the loan portfolio.  The amount of the provision is
based on management's  monthly review of the loan portfolio and consideration of
such  factors  as  historical  loss  experience,   general  prevailing  economic
conditions,  changes  in the size and  composition  of the  loan  portfolio  and
specific borrower considerations, including the ability of the borrower to repay
the loan and the estimated value of the underlying collateral.

The  provision  for loan losses for the three  months ended  September  30, 2000
totaled  $18,747  compared to $17,301 for the three months ended  September  30,
1999.  The allowance for loan losses  totaled  $606,000,  or .50% of gross loans
receivable  and  46.4%  of total  nonperforming  loans at  September  30,  2000,
compared with  $591,000,  or 0.50% of gross loans  receivable and 56.6% of total
nonperforming loans at June 30, 2000. Charge-offs experienced by the Corporation
have primarily related to consumer and other non-real estate loans. As indicated
previously,  such loans make up a small portion of the Corporation's  total loan
portfolio. The Corporation's low historical charge-off history is the product of
a variety of factors, including the Corporation's underwriting guidelines, which
generally require a loan-to-value or projected  completed value ratio of 90% for
purchase or construction of one- to four-family  residential  properties and 75%
for commercial real estate and land loans,  established  income  information and
defined ratios of debt to income.

Noninterest   income.   Noninterest  income  includes  service  fees  and  other
miscellaneous  income and totaled  $28,000 for the three months ended  September
30, 2000 and $23,000 for the three months ended September 30, 1999. The increase
was primarily due to an increase in service charges on deposit accounts.

Noninterest  expense.  Noninterest expense totaled $689,000 for the three months
ended  September  30,  2000  compared  to $714,000  for the three  months  ended
September 30, 1999, a decrease of $25,000,  or 3.5%. The decrease was the result
of a decrease in franchise taxes paid by the  Association.  The Association pays

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

                                  (Continued)

                                      17

<PAGE>

                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

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

franchise  taxes on a  calendar-year  basis based on its net worth at June 30 of
the preceding  year.  The lower capital  levels at the  Association  at June 30,
1999, after the large dividend paid to Peoples prior to June 30, 1999,  resulted
in lower franchise taxes beginning January 1, 2000.

Income  Tax  Expense.   The  volatility  of  income  tax  expense  is  primarily
attributable  to the  change in income  before  income  taxes and the impact the
Corporation's stock price has on the stock-based  employee benefit plans. Income
tax expense  totaled  $100,000  for the three months  ended  September  30, 2000
compared to $93,000 for the three months ended September 30, 1999,  representing
an increase of $7,000.  The effective tax rate was 38.1% and 41.4% for the three
months ended September 30, 2000 and 1999.

Liquidity and Capital Resources

The Corporation's liquidity, primarily represented by cash and cash equivalents,
is a result of operating,  investing and financing activities.  These activities
are summarized below for the three months ended September 30, 2000 and 1999.

<TABLE>
<CAPTION>
                                                                        Three Months
                                                                     Ended September 30,
                                                                 2000                   1999
                                                                   (Dollars in thousands)
<S>                                                       <C>                    <C>
Net income                                                $             162      $            131
Adjustments to reconcile net income to net cash from
  operating activities                                                   43                    68
                                                          -----------------      ----------------
Net cash from operating activities                                      205                   199
Net cash from investing activities                                   (2,705)               (4,989)
Net cash from financing activities                                    3,571                 5,989
                                                          -----------------      ----------------
Net change in cash and cash equivalents                               1,071                 1,199
Cash and cash equivalents at beginning of period                      2,206                 1,933
                                                          -----------------      ----------------
Cash and cash equivalents at end of period                $           3,277      $          3,132
                                                          =================      ================
</TABLE>

The  Corporation's  principal  sources of funds are deposits,  loan  repayments,
maturities of securities and other funds provided by operations. The Association
also has the ability to borrow from the FHLB.  While  scheduled loan  repayments
and maturing  investments  are relatively  predictable,  deposit flows and early
loan  prepayments  are more  influenced  by  interest  rates,  general  economic
conditions and  competition.  The  Association  maintains  investments in liquid
assets based on management's  assessment of the (1) need for funds, (2) expected
deposit  flows,  (3)  yields  available  on  short-term  liquid  assets  and (4)
objectives of the asset/liability management program.

OTS regulations  presently  require the Association to maintain an average daily
balance of investments in United States Treasury, federal agency obligations and
other  investments  in an  amount  equal  to 4% of the sum of the  Association's
average  daily  balance of net  withdrawable  deposit  accounts  and  borrowings
payable in one year or less.  The  liquidity  requirement,  which may be changed
from  time to  time  by the OTS to  reflect  changing  economic  conditions,  is
intended to provide a source of relatively liquid funds on which the Association
may rely, if necessary,  to fund deposit withdrawals or other short-term funding
needs. At September 30, 2000, the Association's  regulatory liquidity was 11.6%.
At such date, the Corporation had commitments to originate fixed-rate commercial
and residential real estate loans totaling $289,000 and variable-rate commercial
and residential real estate mortgage loans totaling  $378,000.  Loan commitments
are generally for 30 days. The  Corporation  considers its liquidity and capital
reserves  sufficient to meet its outstanding short and long-term needs. See Note
5 of the Notes to Consolidated Financial Statements.

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

                                  (Continued)

                                       18

<PAGE>

                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

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

The  Association  is  subject  to  various   regulatory   capital   requirements
administered  by  the  federal  regulatory  agencies.   Under  capital  adequacy
guidelines  and the  regulatory  framework  for prompt  corrective  action,  the
Association  must meet specific  capital  guidelines  that involve  quantitative
measures of the Association's assets,  liabilities and certain off-balance-sheet
items as calculated under regulatory  accounting  practices.  The  Association's
capital amounts and classifications are also subject to qualitative judgments by
the regulators  about the  Association's  components,  risk weightings and other
factors.  Failure to meet minimum  capital  requirements  can  initiate  certain
mandatory  actions that, if undertaken,  could have a direct  material effect on
the Corporation's financial statements. At September 30, 2000 and June 30, 2000,
management  believes  the  Association  complies  with  all  regulatory  capital
requirements. Based on the Association's computed regulatory capital ratios, the
Association is considered well capitalized  under the Federal Deposit  Insurance
Act at  September  30,  2000 and June 30,  2000.  No  conditions  or events have
occurred  subsequent  to the last  notification  by regulators  that  management
believes would have changed the Association's category.

At September 30, 2000 and June 30, 2000, the Association's actual capital levels
and minimum required levels were:

<TABLE>
<CAPTION>
                                                                        Minimum                          Minimum
                                                                     Required To Be                   Required To Be
                                                                  Adequately Capitalized             Well Capitalized
                                                                  Under Prompt Corrective        Under Prompt Corrective
                                            Actual                  Action Regulations             Action Regulations
                                    Amount         Ratio           Amount          Ratio          Amount         Ratio
                                    ------         -----           ------          -----          ------         -----
(Dollars in Thousands)
September 30, 2000
<S>                                <C>             <C>            <C>              <C>         <C>               <C>
Total capital (to risk-
  weighted assets)                $  15,036        17.2%          $  7,006        8.0%         $   8,757         10.0%
Tier 1 (core) capital (to
  risk-weighted assets)              14,431        16.5              3,503        4.0              5,254          6.0
Tier 1 (core) capital (to
  adjusted total assets)             14,431        10.8              5,332        4.0              6,665          5.0
Tangible capital (to
  adjusted total assets)             14,431        10.8              1,999        1.5              N/A

June 30, 2000
Total capital (to risk-
  weighted assets)               $   14,773        17.2%         $   6,858        8.0%        $    8,572         10.0%
Tier 1 (core) capital (to
  risk-weighted assets)              14,183        16.5              3,429        4.0              5,143          6.0
Tier 1 (core) capital (to
  adjusted total assets)             14,183        10.9              5,183        4.0              6,479          5.0
Tangible capital (to
  adjusted total assets)             14,183        10.9              1,944        1.5              N/A
</TABLE>


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


                                       19

<PAGE>


                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                           PART II - OTHER INFORMATION

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

Item 1.  Legal Proceedings
         None.

Item 2.  Changes in Securities and Use of Proceeds
         None.

Item 3.  Defaults Upon Senior Securities
         Not applicable.

Item 4.  Submission of Matters to a Vote of Security Holders
         There  were no  matters  brought  to a vote of  security  holders
         during the quarter ended September 30, 2000.

Item 5.  Other Information
         None.

Item 6.  Exhibits and Reports on Form 8-K
         (a)  Exhibit No. 27: Financial Data Schedule

         (b)  Form 8-K was filed on July 20,  2000 under Item 5, Other  Events,
              the  Corporation  reported  the  issuance  of a press  release to
              announce  the  quarterly  and  year-end  earnings  and  declare a
              dividend.  Form 8-K filed on August 4, 2000  under  Item 5, Other
              Events,  the  Corporation  announced  the date of the 2000 Annual
              Meeting of Shareholders. Form 8-K was filed on September 18, 2000
              under  Item  5,  Other  Events,  the  Corporation  announced  its
              intention to purchase up to 5% of its  outstanding  shares in the
              open market over the next twelve months.

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


                                       20

<PAGE>

                      PEOPLES-SIDNEY FINANCIAL CORPORATION
                                   SIGNATURES

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


Pursuant to the  requirement of the  Securities  Exchange Act of 1934, the small
business  issuer has duly  caused  this report to be signed on its behalf by the
undersigned thereunto duly authorized.




Date:  November 10, 2000                    /s/ Douglas Stewart
     ---------------------                  -----------------------------------
                                            Douglas Stewart
                                            President





Date:  November 10, 2000                    /s/ Debra Geuy
     ---------------------                  -----------------------------------
                                            Debra Geuy
                                            Chief Financial Officer


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


                                       21

<PAGE>

                                INDEX TO EXHIBITS


EXHIBIT
NUMBER               DESCRIPTION                             PAGE NUMBER
------               -----------                             -----------


 27            Financial Data Schedule                            23













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

                                       22