SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

                                   (Mark One)

[X]        QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
           EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2003

                                       OR

[   ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
           EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO

                        Commission file number: 333-35799

                             UNION COMMUNITY BANCORP
               (Exact name of registrant specified in its charter)

Indiana                                                    35-2025237
(State or other jurisdiction of                        (I.R.S. Employer
incorporation or organization)                       Identification  Number)


                              221 East Main Street
                          Crawfordsville, Indiana 47933
                    (Address of principal executive offices,
                               including Zip Code)

                                 (765) 362-2400
              (Registrant's telephone number, including area code)


Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such report), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]

Indicate  by check mark  whether  the  Registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

The  number of shares of the  Registrant's  common  stock,  without  par  value,
outstanding as of June 30, 2003 was 2,100,000.




<PAGE>



                             Union Community Bancorp
                                    Form 10-Q

                                      Index

                                                                        Page No.

FORWARD LOOKING STATEMENT                                                    3

PART I.   FINANCIAL INFORMATION                                              4

Item 1.   Financial Statements                                               4

              Consolidated Condensed Balance Sheets                          4

              Consolidated Condensed Statements of Income                    5

              Consolidated Condensed Statement of Shareholders' Equity       6

              Consolidated Condensed Statements of Cash Flows                7

              Notes to Unaudited Consolidated Condensed Financial Statements 8

Item 2.   Management's Discussion and Analysis of Financial Condition
          and Results of Operations.                                         10

Item 3.   Quantitative and Qualitative Disclosures about Market Risk         14

Item 4.   Controls and Procedures                                            14

PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings                                                  15
Item 2.   Changes in Securities and Use of Proceeds                          15
Item 3.   Defaults Upon Senior Securities                                    15
Item 4.   Submission of Matters to a Vote of Security Holders                15
Item 5.   Other Information                                                  15
Item 6.   Exhibits and Reports on Form 8-K                                   15

SIGNATURES                                                                   16

CERTIFICATIONS                                                               17




<PAGE>




                            FORWARD LOOKING STATEMENT

This  Quarterly  Report on Form 10-Q ("Form  10-Q")  contains  statements  which
constitute  forward  looking  statements  within  the  meaning  of  the  Private
Securities Litigation Reform Act of 1995. These statements appear in a number of
places in this Form 10-Q and include  statements  regarding the intent,  belief,
outlook, estimate or expectations of the Company (as defined in the notes to the
consolidated  condensed  financial  statements),  its  directors or its officers
primarily with respect to future events and the future financial  performance of
the  Company.  Readers  of this Form 10-Q are  cautioned  that any such  forward
looking  statements  are not  guarantees  of future  events or  performance  and
involve risks and  uncertainties,  and that actual results may differ materially
from those in the forward looking statements as a result of various factors. The
accompanying  information  contained  in this  Form  10-Q  identifies  important
factors that could cause such  differences.  These  factors  include  changes in
interest   rates;   loss  of  deposits  and  loan  demand  to  other   financial
institutions;  substantial changes in financial markets;  changes in real estate
values and the real estate market; or regulatory changes.



<PAGE>

PART I  FINANCIAL INFORMATION
Item 1.  Financial Statements

<TABLE>
<CAPTION>
                     UNION COMMUNITY BANCORP AND SUBSIDIARY
                      Consolidated Condensed Balance Sheets

                                                                                         June 30,               December 31,
                                                                                           2003                     2002
                                                                                  ------------------------ -------------------------
                                                                                        (Unaudited)
  Assets
<S>                                                                               <C>                      <C>
       Cash                                                                       $          670,028       $         992,705
       Interest-bearing demand deposits                                                   37,295,429              35,593,482
                                                                                  ------------------------ -------------------------
           Cash and cash equivalents                                                      37,965,457              36,586,187
       Interest-bearing deposits                                                             145,107                 145,107
       Investment securities
              Available for sale                                                           5,006,250                    ----
              Held to maturity                                                               759,372               1,636,513
                                                                                  ------------------------ -------------------------
                       Total investment securities                                         5,765,622               1,636,513
       Loans, net of allowance for loan losses of $1,097,787 and $1,030,000              209,646,063             216,703,469
       Premises and equipment                                                              4,628,011               3,238,899
       Federal Home Loan Bank stock                                                        3,468,900               3,423,600
       Investment in limited partnership                                                     846,609                 836,609
       Foreclosed assets and real estate held for development, net                         1,464,163               1,607,146
       Goodwill                                                                            2,392,808               2,296,927
       Core deposit intangible                                                               441,532                 484,820
       Interest receivable                                                                 1,208,379               1,276,538
       Other assets                                                                        6,032,666               1,080,502
                                                                                  ------------------------ -------------------------
           Total assets                                                               $  274,005,317          $  269,316,317
                                                                                  ======================== =========================

  Liabilities
       Deposits
           Noninterest-bearing                                                     $       3,691,567        $      3,849,659
           Interest-bearing                                                              193,532,436             186,341,769
                                                                                  ------------------------ -------------------------
                Total deposits                                                           197,224,003             190,191,428
       Federal Home Loan Bank advances                                                    39,514,178              39,751,631
       Note payable                                                                          131,892                 302,892
       Interest payable                                                                      491,998                 650,182
       Dividends payable                                                                     315,000                 341,700
       Other liabilities                                                                   1,379,581                 889,967
                                                                                  ------------------------ -------------------------
           Total liabilities                                                             239,056,652             232,127,800
                                                                                  ======================== =========================
  Commitments and Contingent Liabilities

  Shareholders' Equity
       Preferred stock, no par value
           Authorized and unissued - 2,000,000 shares
       Common stock, no-par value
           Authorized - 5,000,000 shares
           Issued and outstanding - 2,100,000 and 2,278,000 shares                        22,361,852              24,159,185
       Retained earnings                                                                  14,439,199              15,032,214
       Accumulated other comprehensive income                                                  4,270                   ----
       Unearned employee stock ownership plan (ESOP) shares                               (1,276,200)            (1,323,401)
       Unearned recognition and retention plan (RRP) shares                                 (580,456)              (679,481)
                                                                                  ------------------------ -------------------------
           Total shareholders' equity                                                     34,948,665              37,188,517
                                                                                  ------------------------ -------------------------

           Total liabilities and shareholders' equity                                $   274,005,317          $  269,316,317
                                                                                  ======================== =========================
</TABLE>

  See notes to consolidated condensed financial statements.


<PAGE>

                     UNION COMMUNITY BANCORP AND SUBSIDIARY
                   Consolidated Condensed Statements of Income
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                     Three Months Ended                    Six Months Ended
                                                                           June 30                              June 30
                                                            ------------------ ------------------- ----------------- ---------------
                                                                   2003               2002               2003              2002
                                                            ------------------ ------------------- ----------------- ---------------
  Interest and Dividend Income
<S>                                                            <C>                <C>                 <C>               <C>
       Loans                                                   $  3,723,641       $  4,421,951        $  7,745,632      $ 8,873,844
       Investment securities                                         47,748             77,665              79,571          154,045
       Dividends on Federal Home Loan Bank stock                     47,477             53,347              91,476          103,998
       Deposits with financial institutions                         133,330            105,807             261,987          146,840
                                                            ------------------ ------------------- ----------------- ---------------
           Total interest and dividend income                     3,952,196          4,658,770            8,178,666       9,278,727
                                                            ------------------ ------------------- ----------------- ---------------

  Interest Expense
       Deposits                                                   1,327,926          1,615,994           2,796,754        3,311,332
       Federal Home Loan Bank advances                              456,898            488,808             909,128          900,870
                                                            ------------------ ------------------- ----------------- ---------------
           Total interest expense                                 1,784,824          2,104,802           3,705,882        4,212,202
                                                            ------------------ ------------------- ----------------- ---------------

  Net Interest Income                                             2,167,372          2,553,968           4,472,784        5,066,525
       Provision for loan losses                                     30,000             20,000              60,000           60,000
                                                            ------------------ ------------------- ----------------- ---------------
  Net Interest Income After Provision for Loan Losses             2,137,372          2,533,968           4,412,784        5,006,525
                                                            ------------------ ------------------- ----------------- ---------------

  Other Income (Losses)
       Service charges on deposit accounts                           35,345             39,822              71,083           72,076
       Equity in income (losses) of limited partnerships                ---             (7,500)             10,000          (12,500)
       Net realized gains on sales of available for sale
  securities                                                            ---              2,574                 ---            8,534
       Other income                                                  49,151             15,100              72,295           59,061
                                                            ------------------ ------------------- ----------------- ---------------
           Total other income                                        84,496             49,996             153,378          127,171
                                                            ------------------ ------------------- ----------------- ---------------

  Other Expenses
       Salaries and employee benefits                               759,072            714,776           1,479,355        1,425,610
       Net occupancy expenses                                        70,655             42,728             146,657          100,183
       Equipment expenses                                            78,305             80,035             158,192          151,522
       Legal and professional fees                                   88,551             68,462             174,076          108,981
       Data processing fees                                         102,988             69,205             204,237          549,246
       Other expenses                                               294,496            238,973             574,297          478,966
                                                            ------------------ ------------------- ----------------- ---------------
           Total other expenses                                   1,394,067          1,214,179           2,736,814        2,814,508
                                                            ------------------ ------------------- ----------------- ---------------

  Income Before Income Tax                                          827,801          1,369,785           1,829,348        2,319,188
       Income tax expense                                           276,817            476,702             633,500          779,182
                                                            ------------------ ------------------- ----------------- ---------------

  Net Income                                                  $     550,984      $     893,083        $  1,195,848      $ 1,540,006
                                                            ================== =================== ================= ===============

  Basic Earnings per Share                                           $  .28             $  .39              $  .59            $  .69
  Diluted Earnings per Share                                            .28                .39                 .58               .69
  Dividends per Share                                                   .15                .12                 .30               .23
</TABLE>

  See notes to consolidated condensed financial statements.



<PAGE>
                     UNION COMMUNITY BANCORP AND SUBSIDIARY
            Consolidated Condensed Statement of Shareholders' Equity
                     For the Six Months Ended June 30, 2003
                                   (Unaudited)

<TABLE>
<CAPTION>


                                                                                  Accumulated
                                     Common Stock                                   Other         Unearned
                                -----------------------
                                  Shares                Comprehensive  Retained   Comprehensive    ESOP      Unearned
                                Outstanding   Amount       Income      Earnings      Income       Shares   Compensation     Total
                                ----------- ----------- -------------- ---------- ------------- ---------- ------------- -----------

<S>               <C>            <C>         <C>                     <C>                      <C>           <C>         <C>
Balances, January 1, 2003        2,278,000   $24,159,185             $15,032,214              $(1,323,401)  $(679,481)  $37,188,517
Comprehensive income
  Net income for the period                               $1,195,848   1,195,848                                          1,195,848
    Other comprehensive
       income, net of tax
       Unrealized gains on                                     4,270               $ 4,270                                    4,270
        securities
                                                          ----------
  Comprehensive income                                    $1,200,118
                                                          ==========
  Cash dividends ($.15 per                                              (616,997)                                          (616,997)
        share)
  Purchase of common stock         178,000    (1,828,434)             (1,171,866)                                        (3,000,300)
  Amortization of unearned
        compensation expense                                                                                   99,025        99,025
  ESOP shares earned                              31,101                                           47,201                    78,302
                                ----------- -------------            ----------- ------------ ------------ ------------- -----------
Balances, June 30, 2003          2,100,000   $22,361,852             $14,439,199   $ 4,270    $(1,276,200)  $(580,456)   34,948,665
                                =========== =============            =========== ============ ============ ============= ===========


</TABLE>

See notes to consolidated condensed financial statements.








<PAGE>

                     UNION COMMUNITY BANCORP AND SUBSIDIARY
                 Consolidated Condensed Statements of Cash Flows
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                                   Six Months Ended
                                                                                                       June 30,
                                                                                              ---------------- ---------------
                                                                                                   2003             2002
                                                                                              ---------------- ---------------
  Operating Activities
<S>                                                                                            <C>              <C>
       Net income                                                                              $  1,195,848     $  1,540,006
       Adjustments to reconcile net income to net cash provided by operating activities
         Provision for loan losses                                                                   67,787           60,000
         Depreciation and amortization                                                              162,152          158,550
         Investment securities accretion, net                                                          (432)          (1,649)
         Gain on sale of investment securities available for sale                                       ---           (8,534)
         Loss on sale of real estate owned                                                           14,045           22,399
         Equity in losses of limited partnerships                                                   (10,000)          12,500
         Amortization of purchase accounting adjustments                                           (169,689)        (453,847)
         Amortization of unearned compensation expense                                               99,025          145,633
         ESOP shares earned                                                                          78,302           70,986
         Net change in:
           Interest receivable                                                                       68,159          154,426
           Interest payable                                                                        (158,184)        (194,788)
         Other adjustments                                                                       (4,951,785)         934,322
                                                                                              ---------------- ---------------
                Net cash provided by (used in) operating activities                              (3,604,772)       2,440,004
                                                                                              ---------------- ---------------

  Investing Activities
       Net change in interest-bearing deposits                                                          ---           94,976
       Investment securities
           Purchase of investment securities available for sale                                  (8,000,000)
           Proceeds from sales of investment securities available for sale                              ---           75,613
           Proceeds from maturities of securities held to maturity and paydowns
                of mortgage-backed securities                                                     3,877,573          353,976
       Net changes in loans                                                                       6,800,243        4,328,598
       Net cash received in acquisition                                                                 ---       15,866,825
       Additions to real estate owned                                                              (124,138)         (42,923)
       Proceeds from real estate sales                                                              389,657          356,769
       Purchases of property and equipment                                                       (1,537,055)        (155,070)
       Other investing activities                                                                   (95,881)            ----

                                                                                              ---------------- ---------------
                Net cash provided by investing activities                                         1,310,399       20,878,764
                                                                                              ---------------- ---------------

  Financing Activities
       Net change in
         Interest-bearing demand and savings deposits                                            13,278,109       12,030,961
         Certificates of deposit                                                                 (6,084,534)     (24,264,383)
       Proceeds from borrowings                                                                        ----       20,000,000
       Repayment of borrowings                                                                     (317,890)     (20,311,993)
       Cash dividends                                                                              (616,997)        (545,383)
       Repurchase of common stock                                                                (3,000,300)      (4,875,570)
       Net change in advances by borrowers for taxes and insurance                                  415,255            9,377
                                                                                              ---------------- ---------------
                Net cash provided by (used in) financing activities                               3,673,643      (17,956,991)
                                                                                              ---------------- ---------------

  Net Change in Cash and Cash Equivalents                                                         1,379,270        5,361,777

  Cash and Cash Equivalents, Beginning of Period                                                 36,586,187       13,564,902
                                                                                              ---------------- ---------------

  Cash and Cash Equivalents, End of Period                                                    $  37,965,457    $  18,926,679
                                                                                              ================ ===============

  Additional Cash Flows Information
       Interest paid                                                                          $   3,864,066    $   4,406,990
       Income tax paid                                                                              696,913          455,991
       Loans transferred to foreclosed real estate                                                  150,790          184,399
</TABLE>

  See notes to consolidated condensed financial statements.
<PAGE>

                     UNION COMMUNITY BANCORP AND SUBSIDIARY
         Notes to Unaudited Consolidated Condensed Financial Statements

Note 1: Basis of Presentation

The consolidated  financial  statements  include the accounts of Union Community
Bancorp, an Indiana corporation (the "Company") and its wholly owned subsidiary,
Union Federal Savings and Loan  Association,  a federally  chartered savings and
loan association ("Union Federal"). A summary of significant accounting policies
is set forth in Note 1 of Notes to Financial Statements included in the December
31, 2002 Annual Report to Shareholders.  All significant  intercompany  accounts
and transactions have been eliminated in consolidation.

The interim  consolidated  financial statements have been prepared in accordance
with instructions to Form 10-Q, and therefore do not include all information and
footnotes  necessary for a fair presentation of financial  position,  results of
operations  and cash flows in  conformity  with  generally  accepted  accounting
principles.

The interim  consolidated  financial  statements  at June 30, 2003,  and for the
three and six months  ended  June 30,  2003 and 2002,  have not been  audited by
independent  accountants,  but  reflect,  in  the  opinion  of  management,  all
adjustments  (which  include  only normal  recurring  adjustments)  necessary to
present fairly the financial position,  results of operations and cash flows for
such periods.  The results of operations for the six-month period ended June 30,
2003,  are not  necessarily  indicative of the results which may be expected for
the entire year. The consolidated  condensed  balance sheet of the Company as of
December 31, 2002 has been derived from the audited  consolidated  balance sheet
of the Company as of that date.

Note 2: Earnings Per Share

Earnings per share have been  computed  based upon the  weighted-average  common
shares  outstanding.  Unearned  Employee  Stock  Ownership Plan shares have been
excluded from the computation of average common shares outstanding.

<TABLE>
<CAPTION>
                                              Three Months Ended                           Three Months Ended
                                                 June 30, 2003                                June 30, 2002
                                                 -------------                                -------------
                                                   Weighted                                      Weighted
                                                    Average        Per Share                     Average      Per Share
                                      Income        Shares           Amount         Income        Shares        Amount
                                      ------        ------           ------         ------        ------        ------
Basic earnings per share
   Income available to common
<S>                                     <C>         <C>               <C>            <C>        <C>                <C>
    shareholders                        $550,984    1,973,814         $ .28          $893,083   2,278,959          $ .39
                                                                  ===========                                =============

Effect of dilutive RRP awards
and stock options                                       23,577                                      3,900
                                   -------------- ---------------                 ------------ -------------

Diluted earnings per share
   Income available to  common
    shareholders and assumed
    conversions                        $ 550,984    1,997,391         $ .28         $ 893,083   2,282,859          $ .39
                                   ============== =============== ===========     ============ ============= =============
</TABLE>

<TABLE>
<CAPTION>


                                               Six Months Ended                               Six Months Ended
                                                 June 30, 2003                                 June 30, 2002
                                                 -------------                                 -------------
                                                   Weighted                                       Weighted
                                                    Average        Per Share                      Average      Per Share
                                      Income        Shares           Amount          Income        Shares        Amount
                                      ------        ------           ------          ------        ------        ------
Basic earnings per share
   Income available to common
<S>                                  <C>            <C>               <C>          <C>           <C>                <C>
    shareholders                     $ 1,195,848    2,032,240         $ .59        $ 1,540,006   2,222,956          $ .69
                                                                  ===========                                 =============

Effect of dilutive RRP awards
and stock options                                       19,381                                       1,950
                                   -------------- ---------------                 ------------- -------------

Diluted earnings per share
   Income available to  common
    shareholders and assumed
    conversions                      $ 1,195,848    2,051,621         $ .58        $ 1,540,006   2,224,906          $ .69
                                   ============== =============== ===========     ============= ============= =============
</TABLE>
<PAGE>

Note 4: Stock Options

The Company has a stock-based  employee  compensation  plan,  which is described
more fully in the Notes to  Financial  Statements  included in the  December 31,
2002 Annual Report to shareholders. The Company accounts for this plan under the
recognition  and  measurement  principles of APB Opinion No. 25,  Accounting for
Stock Issued to Employees, and related interpretations.  No stock-based employee
compensation  cost is reflected in net income,  as all options granted under the
plan had an exercise  price equal to the market value of the  underlying  common
stock on the grant  date.  The  following  table  illustrates  the effect on net
income  and  earnings  per  share if the  Company  had  applied  the fair  value
provisions  of  Statement of Financial  Accounting  Standards  ("SFAS") No. 123,
Accounting for Stock-Based Compensation, to stock-based employee compensation.

<TABLE>
<CAPTION>
                                                                        Three Months Ended June      Three Months Ended
                                                                                30, 2003               June 30, 2002
                                                                        -----------------------------------------------------

<S>                                                                           <C>                          <C>
            Net income, as reported                                           $   550,984                  $ 893,083
            Less:  Total stock-based employee compensation cost
               determined under the fair value based method, net of
               income taxes                                                         9,133                     12,016
                                                                        -----------------------------------------------------
            Pro forma net income                                              $   541,851                  $ 881,067
                                                                        =====================================================

            Earnings per share:

                Basic - as reported                                           $       .28                  $     .39

                Basic - pro forma                                             $       .27                  $     .39

                Diluted - as reported                                         $       .28                  $     .39

                Diluted - pro forma                                           $       .27                  $     .39
</TABLE>
<TABLE>
<CAPTION>

                                                                            Six Months Ended          Six Months Ended
                                                                             June 30, 2003             June 30, 2002
                                                                        -----------------------------------------------------
<S>                                                                           <C>                          <C>
            Net income, as reported                                           $ 1,195,848                  $1,540,006
            Less:  Total stock-based employee compensation cost
               determined under the fair value based method, net of
               income taxes                                                        18,267                      24,032
                                                                        -----------------------------------------------------
            Pro forma net income                                              $ 1,177,581                  $1,515,974
                                                                        =====================================================
            Earnings per share:

                Basic - as reported                                           $       .59                  $      .69

                Basic - pro forma                                             $       .58                  $      .68

                Diluted - as reported                                         $       .58                  $      .69

                Diluted - pro forma                                           $       .57                  $      .68
</TABLE>


Note 5: Effect of Recent Accounting Pronouncements

The  Financial  Accounting  Standards  Board  ("FASB")  adopted  SFAS  No.  148,
Accounting  for  Stock-Based  Compensation  - Transition  and  Disclosure.  This
Statement   amends  FASB   Statement  No.  123,   Accounting   for   Stock-Based
Compensation.  SFAS No. 148 provides  alternative  methods of  transition  for a
voluntary  change to the fair value based method of accounting  for  stock-based
employee  compensation.   In  addition,  SFAS  No.  148  amends  the  disclosure
requirements  of SFAS No.  123 to  require  more  prominent  and  more  frequent
disclosures   in  financial   statements   about  the  effects  of   stock-based
compensation.

Under the  provisions  of SFAS No. 123,  companies  that  adopted the fair value
based  method were  required to apply that  method  prospectively  for new stock
option  awards.   This   contributed  to  a  "ramp-up"   effect  on  stock-based
compensation  expense in the first few years  following  adoption,  which caused
concern  for  companies  and  investors  because of the lack of  consistency  in
reported results. To address that concern,  SFAS No. 148 provides two additional
methods of transition  that reflect an entity's full  complement of  stock-based
compensation expense immediately upon adoption,  thereby eliminating the ramp-up
effect.
<PAGE>
SFAS No. 148 also improves the clarity and prominence of  disclosures  about the
proforma  effects  of using  the fair  value  based  method  of  accounting  for
stock-based compensation for all companies - regardless of the accounting method
used - by requiring  that the data be presented more  prominently  and in a more
user-friendly format in the footnotes to the financial statements.  In addition,
SFAS No. 148 improves the timeliness of those disclosures by requiring that this
information be included in interim as well as annual  financial  statements.  In
the past,  companies were required to make proforma  disclosures  only in annual
financial statements.

The  transition  guidance and annual  disclosure  provisions of SFAS No. 148 are
effective  for fiscal  years  ending  after  December  15,  2002,  with  earlier
application   permitted  in  certain   circumstances.   The  interim  disclosure
provisions are effective for financial reports containing  financial  statements
for interim periods beginning after December 15, 2002.

The FASB has  stated it  intends  to issue a new  statement  on  accounting  for
stock-based  compensation  and will require  companies to expense  stock options
using a fair value based method at date of grant. The date of implementation for
this proposed statement is not known.

In November 2002, the FASB issued Interpretation No. 45, Guarantor's  Accounting
and Disclosure  Requirements for Guarantees,  Including  Indirect  Guarantees of
Indebtedness  of Others ("FIN 45"). FIN 45 will change  current  practice in the
accounting   for  and   disclosure  of   guarantees.   Guarantees   meeting  the
characteristics  described in FIN 45 are  required to be  initially  recorded at
fair value,  which is different from the general current practice of recording a
liability only when a loss is probable and reasonably estimable,  as those terms
are defined in FASB Statement No. 5, Accounting for  Contingencies.  FIN 45 also
requires a guarantor to make new  disclosures  for virtually all guarantees even
if the likelihood of the guarantor's having to make payments under the guarantee
is remote.

In general,  FIN 45 applies to  contracts  or  indemnification  agreements  that
contingently  require the  guarantor to make  payments to the  guaranteed  party
based on changes in an underlying asset, liability, or an equity security of the
guaranteed party such as financial standby letters of credit.

Disclosure  requirements  of FIN 45 are effective  for  financial  statements of
interim  or  annual   periods  ending  after  December  31,  2002.  The  initial
recognition and measurement  provisions are applicable on a prospective basis to
guarantees  issued or modified  after  December  31, 2002,  irrespective  of the
guarantor's fiscal year-end.  The guarantor's previous accounting for guarantees
issued prior to the date of FIN 45 initial applications should not be revised or
restated to reflect the provisions of FIN 45.

The Company  adopted FIN 45 on January 1, 2003.  The adoption of FIN 45 does not
currently  have a  material  impact  on  the  Company's  consolidated  financial
statements.

Note 6: Reclassifications

Certain  reclassifications  have  been made to the 2002  consolidated  condensed
financial statements to conform to the June 30, 2003 presentation.

Item 2: Management's  Discussion and Analysis of Financial Condition and Results
of Operations

General

The Company was  organized in September  1997. On December 29, 1997, it acquired
the common stock of Union  Federal upon the  conversion  of Union Federal from a
federal mutual savings and loan  association to a federal stock savings and loan
association.    The   Company   acquired   Montgomery   Financial    Corporation
("Montgomery")  in a  transaction  that  closed  on  January  2,  2002.  In  the
transaction,  Montgomery  was merged with and into the Company,  and  Montgomery
Savings,  a federally  chartered thrift, was merged with and into Union Federal.
Following  the merger,  MSA Service  Corp ("MSA")  became a subsidiary  of Union
Federal.

Union Federal was organized as a state-chartered savings and loan association in
1913.  Union  Federal  conducts  its  business  from its main office  located in
Crawfordsville,  Indiana.  In addition,  Union Federal has two branch offices in
Crawfordsville  and branch  offices in Covington,  Williamsport  and  Lafayette,
Indiana.  Four of the above  mentioned  branch  offices were added in connection
with the acquisition of Montgomery.

Union Federal offers a variety of lending,  deposit and other financial services
to its retail and  commercial  customers.  Union  Federal's  principal  business
consists  of  attracting  deposits  from  the  general  public  and  originating
fixed-rate and  adjustable-rate  loans secured primarily by first mortgage liens
on one- to four-family residential real estate. Union Federal's deposit accounts
are insured up to applicable limits by the Savings Association Insurance Fund of
the Federal  Deposit  Insurance  Corporation.  Union Federal  offers a number of
financial  services,  which include:  (i)  residential  real estate loans;  (ii)
multi-family loans; (iii) commercial real estate loans; (iv) construction loans;
(v) home improvement loans and consumer loans, including single-pay loans, loans
secured by deposits,  installment  loans and commercial loans; (vi) money market
demand accounts;  (vii) passbook savings  accounts;  and (viii)  certificates of
deposit.
<PAGE>

Union Federal currently owns two subsidiaries,  UFS Service Corp. ("UFS"), whose
sole asset is its investment in Pedcor Investments 1993-XVI, L.P. ("Pedcor") and
MSA, which is a real estate  management and  development  company.  Pedcor is an
Indiana  limited  partnership  that was  established  to organize,  build,  own,
operate and lease a 48-unit apartment complex in  Crawfordsville,  Indiana known
as Shady Knoll II  Apartments  (the  "Project").  Union Federal owns the limited
partner interest in Pedcor.  The general partner is Pedcor  Investments LLC. The
Project,  operated as a multi-family,  low- and moderate-income housing project,
which is completed and is performing as planned. Because UFS engages exclusively
in activities that are  permissible for a national bank, OTS regulations  permit
Union Federal to include its investment in UFS in its  calculation of regulatory
capital. At present, MSA owns a tract of land in Crawfordsville,  Indiana, which
is being  developed  for the  construction  of seven  condominium  units.  Union
Federal's  investment  in MSA is excluded  from its  calculation  of  regulatory
capital.

Union  Federal's  results of operations  depend  primarily upon the level of net
interest income,  which is the difference  between the interest income earned on
interest-earning assets, such as loans and investments,  and costs incurred with
respect to  interest-bearing  liabilities,  primarily  deposits and  borrowings.
Results of operations also depend upon the level of Union Federal's non-interest
income,  including  fee  income  and  service  charges,  and  the  level  of its
non-interest expenses, including general and administrative expenses.

Critical Accounting Policies

Note 1 to the  consolidated  financial  statements  contains  a  summary  of the
Company's  significant  accounting  policies presented on pages 25 through 27 of
the Annual Report to  Shareholders  for the year ended December 31, 2002,  which
was filed on Form 10-K with the  Commission on March 28, 2003.  Certain of these
policies are important to the portrayal of the  Company's  financial  condition,
since  they  require  management  to  make  difficult,   complex  or  subjective
judgments,  some of which may relate to matters that are  inherently  uncertain.
Management  believes that its critical  accounting  policies include determining
the allowance for loan losses,  the valuation of the foreclosed  assets and real
estate held for development, and the valuation of intangible assets.

Allowance for loan losses

The allowance for loan losses is a significant estimate that can and does change
based on management's  assumptions about specific  borrowers and current general
economic and business  conditions,  among other factors.  Management reviews the
adequacy of the  allowance  for loan losses at least on a quarterly  basis.  The
evaluation includes a review of payment performance,  adequacy of collateral and
financial condition of all major borrowers.  A review of all nonperforming loans
and  other  identified  problem  loans  is  performed  and  the  probability  of
collecting all amounts due thereunder is determined. In addition, changes in the
composition of the loan  portfolio,  the total  outstanding  loans and past loss
experience  are reviewed to determine  the  adequacy of the  allowance  for loan
losses. Current economic and market conditions and potential negative changes to
economic  conditions  are also  reviewed in  determining  possible  loan losses.
Although it is the intent of  management  to fully  evaluate  and  estimate  the
potential effects of economic and market  conditions,  changes in the conditions
are susceptible to significant  changes beyond those  projected.  A worsening or
protracted economic decline beyond  management's  projections would increase the
likelihood of additional losses due to the additional credit and market risk and
could create the need for additional loss reserves.

Foreclosed assets and real estate held for development

Foreclosed  assets and real estate held for development are carried at the lower
of cost or fair value less  estimated  selling costs.  Management  estimates the
fair value of the properties based on current appraisal information.  Reviews of
estimated  fair  value  are  performed  on at least an  annual  basis.  Economic
environment,  market  conditions  and the real  estate  market  are  continually
monitored and  decreases in the carried  value are written down through  current
operations when any of these factors  indicate a decrease to the market value of
the assets.  Future worsening or protracted economic conditions and a decline in
the real estate  market would  increase the  likelihood of a decline in property
values and could create the need for future write downs of the properties held.

Intangible assets

Management  periodically  assesses  the  impairment  of  its  goodwill  and  the
recoverability of its core deposit intangible.  Impairment is the condition that
exists when the carrying  amount of goodwill  exceeds its implied fair value. If
actual external conditions and future operating results differ from management's
judgments,  impairment and/or increased amortization charges may be necessary to
reduce the carrying value of these assets to the appropriate  value. A review of
the fair  value  of the  Company's  goodwill  and core  deposit  intangible  was
performed  in the fourth  quarter of 2002 and it was  management's  opinion that
there was no impairment of these intangible assets as of the date of the review.
<PAGE>

Financial Condition

Total  assets  increased  $4.7  million to $274.0  million at June 30, 2003 from
$269.3 million at December 31, 2002. Net loans  decreased $7.1 million to $209.6
million at June 30, 2003. Cash and cash equivalents  increased $1.4 million from
December 31, 2002 to June 30, 2003. Investment securities increased $4.1 million
from $1.6 million at December  31, 2002 to $5.7  million at June 30, 2003.  This
increase  was due to an  increase  in  available  for sale  investments  of $5.0
million and a decrease in held to maturity  investments  $877,000 in payments on
mortgage-backed  securities.  Premises and equipment  increased  $1.4 million to
$4.6  million  at  June  30,  2003  primarily  due to the  cost  of the  current
remodeling  of Union  Federal's  home  office.  Real  estate  owned and held for
investment  decreased  $143,000 to $1.5 million at June 30, 2003.  In connection
with the  Montgomery  acquisition,  the  balance of  goodwill  and core  deposit
intangibles  are  $2.4  million  and  $442,000  respectively.  Goodwill  will be
reviewed  annually for  impairment  and core deposit  intangibles  are currently
being  amortized.  Other assets increased from $1.1 million at December 31, 2002
to $6.0  million at June 30,  2003.  This  increase is  primarily  due to a $5.0
million purchase of bank owned life insurance.

Total  liabilities  increased  $6.9 million from $232.1  million at December 31,
2002 to $239.0 million at June 30, 2003.  Deposits  increased by $7.0 million to
$197.2 million  during the six months ended June 30, 2003  primarily  accounting
for the change in total liabilities.

Shareholders'  equity  decreased $2.2 million to $34.9 million at June 30, 2003.
The decrease was primarily  due to repurchase of 178,000  shares of common stock
at a total cost of $3.0 million, or an average cost of $16.86 per share, and the
payment of cash  dividends  in the amount of  $617,000  partially  offset by net
income of $1.2 million,  Employee Stock  Ownership Plan shares earned of $78,000
and unearned compensation amortization of $99,000.

Comparison  of  Operating  Results for the Three  Months Ended June 30, 2003 and
2002

Net income decreased  $342,000 from $893,000 for the three months ended June 30,
2002 to $551,000 for the three months ended June 30, 2003. The return on average
assets for the three months  ended June 30, 2003 was .79%  compared to 1.32% for
the comparable period in 2002. The return on average equity for the three months
ended June 30,  2003 was 6.02%  compared to 9.25% for the  comparable  period in
2002.

For the three months ended June 30,  2003,  interest  income was $4.0 million as
compared to $4.7  million for the three  months  ended June 30,  2002.  Interest
income  decreased  primarily due to a decrease in the yield on  interest-earning
assets from 7.22% during the 2002 period to 5.96% during the 2003 period,  which
was  partially  offset by an  increase  in average  interest-earning  asset from
$256.2  million at June 30,  2002 to $265.2  million at June 30,  2003.  For the
three months ended June 30, 2003,  interest expense was $1.8 million as compared
to $2.1  million for the three  months  ended June 30,  2002.  Interest  expense
decreased   primarily  due  to  a  decrease  in  the  cost  of  interest-bearing
liabilities  from 3.72%  during the 2002 period to 3.02% during the 2003 period,
which was offset by an increase  in average  interest-bearing  liabilities  from
$226.8 million at June 30, 2002 to $236.5 million at June 30, 2003. Amortization
of purchase  accounting  adjustments  also impacted  interest expense during the
2002 and 2003  periods.  The  amortization  of purchase  accounting  adjustments
reduced  interest expense by $126,000 in the 2003 period compared to a reduction
of $276,000 for the 2002 period.

The  provision  for loan  losses for the three  months  ended June 30,  2003 was
$30,000 as compared to $20,000 for the  comparable  period in 2002.  A review is
performed  quarterly  to determine  the  adequacy of the current  balance in the
allowance for loan losses.

Total other  income  increased  $35,000  from $50,000 for the three months ended
June 30, 2002 to $85,000 for the 2003  comparable  period.  Total other expenses
increased  $180,000 from  $1,214,000 for the three months ended June 30, 2002 to
$1,394,000 for the  comparable  period in 2003.  Salaries and employee  benefits
increased $44,000 during the comparable  three-month periods primarily due to an
increase in expense in funding the defined benefit pension plan in the amount of
$19,000,  an  increase of $16,000 in  employee  insurance  expense and an $8,000
increase in employee  compensation.  Net  occupancy  expense  increased  $28,000
during the comparable periods primarily due to general increases in expenses and
the loss of office rental income due to the  Montgomery  acquisition.  Legal and
professional fees increased  $20,000 to $89,000 for the three-months  ended June
30,  2003.  This  increase was due to an increase in legal fees of $6,000 and an
increase in consulting  fees of $31,000  primarily due to the use of consultants
for daily  monitoring of information  technology  service and needs,  this being
partially offset by a decrease in audit and accounting  expense in the amount of
$17,000.  Data processing expense increased $34,000 for the comparative  periods
due to an increase in services  provided by the service  bureau.  Other expenses
increased  $55,000  from  $239,000  for the three  months ended June 30, 2002 to
$294,000  for the 2003  comparable  period.  The two  major  increases  in other
expenses  was an increase in  advertising  expense of $35,000 and an increase in
directors compensation of $11,000.
<PAGE>
Comparison of Operating Results for the Six Months Ended June 30, 2003 and 2002

Net income decreased  $344,000 from $1,540,000 for the six months ended June 30,
2002 to $1,196,000 for the six months ended June 30, 2003. The return on average
assets for the six months ended June 30, 2003 was .86% compared to 1.13% for the
comparable period in 2002. The return on average equity for the six months ended
June 30, 2003 was 6.46% compared to 7.84% for the comparable six-month period in
2002.

For the six months  ended June 30,  2003,  interest  income was $8.2  million as
compared to $9.3 million for the six months ended June 30, 2002. Interest income
decreased  primarily due to a decrease in the yield on  interest-earning  assets
from 7.10%  during the 2002 period to 6.16%  during the 2003  period,  which was
partially  offset by an increase in average  interest-earning  asset from $261.4
million at June 30, 2002 to $265.6  million at June 30, 2003. For the six months
ended June 30,  2003,  interest  expense  was $3.7  million as  compared to $4.2
million  for the six months  ended June 30,  2002.  Interest  expense  decreased
primarily  due to a decrease in the cost of  interest-bearing  liabilities  from
3.73% during the 2002 period to 3.16%  during the 2003 period,  which was offset
by an increase in average  interest-bearing  liabilities  from $225.6 million at
June 30,  2002 to $234.8  million at June 30,  2003.  Amortization  of  purchase
accounting  adjustments also impacted  interest expense during the 2002 and 2003
periods.  The amortization of purchase  accounting  adjustments reduced interest
expense by $252,000 in the 2003 period  compared to a reduction  of $552,000 for
the 2002 period.

The provision for loan losses for both six-month  periods was $60,000.  A review
is performed  quarterly to determine the adequacy of the current  balance in the
allowance for loan losses.

Total other income increased $26,000 from $127,000 for the six months ended June
30, 2002 to  $153,000  for the 2003  comparable  period.  Total  other  expenses
decreased  $78,000  from  $2,815,000  for the six months  ended June 30, 2002 to
$2,737,000 for the  comparable  period in 2003.  Salaries and employee  benefits
increased  $54,000 during the comparable  six-month  periods primarily due to an
increase in expense in funding the defined benefit pension plan in the amount of
$49,000,  an  increase of $25,000 in  employee  insurance  expense and a $21,000
increase in  employee  compensation  partially  offset by a decrease in unearned
compensation  expense of $47,000. Net occupancy expense increased $47,000 during
the comparable  periods  primarily due to general  increases in expenses and the
loss of  office  rental  income  due to the  Montgomery  acquisition.  Legal and
professional  fees increased  $65,000 to $174,000 for the six-months  ended June
30,  2003.  This  increase was due to an increase in legal fees of $6,000 and an
increase in consulting  fees of $66,000  primarily due to the use of consultants
for daily  monitoring  of  information  technology  service and needs this being
partially offset by a decrease in audit and accounting  expense in the amount of
$7,000.  Data processing expense decreased $345,000 for the comparative  periods
due to a  one-time  terminations  fee for data  processing  services  charged to
expense  during the 2002  comparative  period  offset by the cost of  additional
services being offered.  Other expenses  increased $96,000 from $479,000 for the
six months ended June 30, 2002 to $575,000 for the 2003 comparable  period.  The
three major  increases in other expenses was an increase in advertising  expense
of $45,000, an increase in directors  compensation of $21,000 and an increase in
real estate owned expense of $15,000.

Asset Quality

Union  Federal  currently  classifies  loans as  special  mention,  substandard,
doubtful  and loss to  assist  management  in  addressing  collection  risks and
pursuant to regulatory  requirements  which are not necessarily  consistent with
generally  accepted  accounting  principles.  Special  mention  loans  represent
credits  that  have  potential   weaknesses  that  deserve   management's  close
attention.  If left  uncorrected,  these  potential  weaknesses  may  result  in
deterioration  of the repayment  prospects or Union Federal's credit position at
some future date.  Substandard  loans  represent  credits  characterized  by the
distinct  possibility  that some loss will be sustained if deficiencies  are not
corrected.  Doubtful loans possess the characteristics of substandard loans, but
collection  or  liquidation  in full is  doubtful  based  upon  existing  facts,
conditions and values. A loan classified as a loss is considered  uncollectible.
At June 30, 2003 Union Federal had $6.6 million in classified assets as compared
to $7.0 million at December 31,  2002.  Union  Federal had $2.9 million and $2.7
million in loans  classified as special mention as of June 30, 2003 and December
31, 2002  respectively.  In  addition,  Union  Federal had $3.4 million and $4.2
million of loans  classified  as  substandard  at June 30, 2003 and December 31,
2002,  respectively.  At June 30, 2003 and December  31, 2002 Union  Federal had
$214,000 and  $103,000,  respectively,  in loans  classified  as doubtful and no
loans were  classified  as loss at either  period  end.  At June 30,  2003,  and
December  31,  2002,  respectively,   $3.6  million  and  $3.1  million  of  the
substandard and doubtful loans were  non-accrual  loans.  The allowance for loan
losses  was  $1,098,000  or .52%  of  loans  at June  30,  2003 as  compared  to
$1,030,000 or .47% of loans at December 31, 2002.

Liquidity and Capital Resources

The standard measure of liquidity for savings  associations is the ratio of cash
and eligible  investments to a certain  percentage of net  withdrawable  savings
accounts  and  borrowings  due within one year.  The minimum  required  ratio is
currently set by the Office of Thrift  Supervision  regulation at 4%. As of June
30, 2003, Union Federal had liquid assets of $38.2 million and a liquidity ratio
of 15.7%.
<PAGE>

Off-balance Sheet Arrangements

As of the date of this Report, Union Federal does not have any off-balance sheet
arrangements  that have or are  reasonably  likely  to have a current  or future
effect  on  the  Union  Federal's  financial  condition,   change  in  financial
condition,  revenues or  expenses,  results of  operations,  liquidity,  capital
expenditures  or capital  resources  that are  material to  investors.  The term
"off-balance sheet arrangement" generally means any transaction,  agreement,  or
other  contractual  arrangement  to which an entity  unconsolidated  with  Union
Federal is a party  under which Union  Federal  has (i) any  obligation  arising
under a guarantee contract,  derivative instrument or variable interest; or (ii)
a retained  or  contingent  interest  in assets  transferred  to such  entity or
similar arrangement that serves as credit,  liquidity or market risk support for
such assets.

Other

The  Securities  and  Exchange  Commission  maintains  a Web site that  contains
reports,   proxy  information   statements,   and  other  information  regarding
registrants that file electronically with the Commission, including the Company.
The address is http://www.sec.gov.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Presented  below,  as of March 31, 2003 and 2002,  is the most recent  available
analyses  performed by the OTS of Union Federal's interest rate risk as measured
by changes in net  portfolio  value  ("NPV")  for  instantaneous  and  sustained
parallel shifts in the yield curve, in 100 basis point increments.

        Union Federal:

<TABLE>
<CAPTION>
                                     At March 31, 2003                         At March 31, 2002
                                     -----------------                         -----------------
          Changes In Rates       $ Change in NPV      % Change in NPV      $ Change in NPV      % Change in NPV
          ----------------       ---------------      ---------------      ---------------      ---------------
<S>          <C>                   <C>                      <C>              <C>                      <C>
            +300 bp                $ (9,982)                (22)%            $ (16,375)               (37)%
            +200 bp                  (5,577)                (13)               (10,659)               (24)
            +100 bp                  (1,841)                 (4)                (5,035)               (11)
               0 bp                       0                   0                      0                  0
            -100 bp                    (612)                 (1)                 3,078                  7
</TABLE>

Management believes that at June 30, 2003 and March 31, 2003, there have been no
material  changes in market  interest  rates or in the  Company's  interest rate
sensitive  instruments  which would  cause a material  change in the market risk
exposures  which affect the  quantitative  and qualitative  risk  disclosures as
presented  on pages 17-19 of the  Company's  Annual  Report on Form 10-K for the
period ended December 31, 2002.

Item 4.  Controls and Procedures

(a)  Evaluation  of disclosure  controls and  procedures.  The  Company's  chief
executive   officer  and  chief   financial   officer,   after   evaluating  the
effectiveness of the Company's disclosure controls and procedures (as defined in
Sections  13a-15(e)  and  15d-15(e)  of the  regulations  promulgated  under the
Securities  Exchange Act of 1934, as amended),  as of the end of the most recent
fiscal quarter covered by this quarterly  report (the "Evaluation  Date"),  have
concluded that as of the Evaluation Date, the Company's  disclosure controls and
procedures  were adequate and are designed to ensure that  material  information
relating to the Company  would be made known to such  officers by others  within
the Company on a timely basis.

(b)  Changes in  internal  controls.  There were no  significant  changes in the
Company's  internal  control over financial  reporting  identified in connection
with the Company's  evaluation  of controls  that occurred  during the Company's
last fiscal quarter that has  materially  affected,  or is reasonably  likely to
materially affect, the Company's internal control over financial reporting.





<PAGE>



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.

              None.

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

              On April 16, 2003, Union Community Bancorp held its Annual Meeting
              of Shareholders. Four directors were elected to terms expiring in
              2006 by the following votes:

              C. Rex Henthorn           For: 1,823,930    Withheld: 240,901
              Samuel H. Hildebrand      For: 1,877,689    Withheld: 187,142
              Joseph M. Malott          For: 1,877,862    Withheld: 186,969
              Harry A. Siamas           For: 1,966,176    Withheld:   98,655

              The terms of office of the following directors of Union Community
              Bancorp continued after the Annual Shareholder Meeting:

              Name                               Term Expires In
              ----                               ---------------
              Philip L. Boots                         2004
              Mark E. Foster                          2004
              John M. Horner                          2004
              Marvin L. Burkett                       2005
              Phillip E. Grush                        2005
              Joseph E. Timmons                       2005

Item 5.       Other Information.

              None.

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

          (a) Exhibits

               31(1)Certification  required by 17 C.F.R.  Section  240.13a-14(a)

               31(1) Certification  required by 17 C.F.R. Section  240.13a-14(a)

               32 Certification  pursuant to 18 U.S.C.  Section 1350, as adopted
               pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

          (b) Reports on Form 8-K

               1.   Earnings  release for the quarter ended March 31, 2003 filed
                    on April 22, 2003.

               2.   Press  release   announcing  the  completion  of  the  stock
                    repurchase program that began on March 25, 2003 filed on May
                    30, 2003.

<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the  Registrant  has duly  caused  this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                       LINCOLN BANCORP

Date: August 13, 2003                By: /s/ Alan L. Grimble
                                        ---------------------------------------
                                        T. Tim Unger
                                        President and Chief Executive Officer


Date: August 13, 2003                By: /s/ John M. Baer
                                        -------------------------------
                                        John M. Baer
                                        Treasurer