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 MARCH 31, 2005

                                       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: 000-23543

                             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 March 31, 2005 was 1,939,000.




<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                                          9

Item 3.  Quantitative and Qualitative Disclosures about Market Risk        12

Item 4.  Controls and Procedures                                           12

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings                                                 13
Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds       13
Item 3.  Defaults Upon Senior Securities                                   13
Item 4.  Submission of Matters to a Vote of Security Holders               13
Item 5.  Other Information                                                 13
Item 6.  Exhibits                                                          13

SIGNATURES                                                                 14

CERTIFICATIONS                                                             15




                                       2
<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.



                                       3
<PAGE>

PART I  FINANCIAL INFORMATION
Item 1.  Financial Statements
<TABLE>
<CAPTION>

                     UNION COMMUNITY BANCORP AND SUBSIDIARY
                      Consolidated Condensed Balance Sheets

                                                                                         March 31,              December 31,
                                                                                           2005                     2004
                                                                                  ------------------------ -------------------------
                                                                                        (Unaudited)
  Assets
<S>                                                                                  <C>                     <C>
       Cash                                                                          $       804,101         $       706,107
       Interest-bearing demand deposits                                                   11,572,104              12,781,907
                                                                                  ------------------------ -------------------------
           Cash and cash equivalents                                                      12,376,205              13,488,014
       Interest-bearing deposits                                                             115,647                 115,647
       Investment securities
           Available for sale                                                              2,995,180               3,037,390
           Held to maturity                                                                  130,807                 151,749
                                                                                  ------------------------ -------------------------
                Total investment securities                                                3,125,987               3,189,139
       Loans, net of allowance for loan losses of $959,952 and $910,000                  222,913,574             217,055,756
       Premises and equipment                                                              4,110,776               4,180,346
       Federal Home Loan Bank stock                                                        3,760,200               3,720,600
       Investment in limited partnership                                                   2,022,991               2,184,092
       Foreclosed assets and real estate held for development, net                         1,733,303               1,622,516
       Goodwill                                                                            2,392,808               2,392,808
         Interest receivable                                                               1,116,780               1,085,532
       Cash value of life insurance                                                        6,970,746               6,899,927
       Other assets                                                                          674,551                 965,034
                                                                                  ------------------------ -------------------------

           Total assets                                                              $   261,313,568         $   256,899,411
                                                                                  ======================== =========================

  Liabilities
       Deposits
           Noninterest-bearing                                                       $     3,508,359         $     4,515,065
           Interest-bearing                                                              184,126,020             183,945,975
                                                                                  ------------------------ -------------------------
                Total deposits                                                           187,634,379             188,461,040
       Borrowings                                                                         37,881,242              32,907,898
       Interest payable                                                                      476,498                 651,355
       Other liabilities                                                                   1,665,425               1,442,176
                                                                                  ------------------------ -------------------------
           Total liabilities                                                             227,657,544             223,462,469
                                                                                  ------------------------ -------------------------

  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 - 1,939,000 and 1,928,000 shares                        20,836,947              20,654,353
       Retained earnings                                                                  14,416,483              14,401,571
       Accumulated other comprehensive loss                                                  (33,106)                 (7,615)
       Unearned employee stock ownership plan (ESOP) shares                               (1,115,451)             (1,137,566)
       Unearned recognition and retention plan (RRP) shares                                 (448,849)               (473,801)
                                                                                  ------------------------ -------------------------
           Total shareholders' equity                                                     33,656,024              33,436,942
                                                                                  ------------------------ -------------------------

           Total liabilities and shareholders' equity                                $   261,313,568         $   256,899,411
                                                                                  ======================== =========================

  See notes to consolidated condensed financial statements.
</TABLE>


                                        4
<PAGE>
<TABLE>
<CAPTION>
                     UNION COMMUNITY BANCORP AND SUBSIDIARY
                   Consolidated Condensed Statements of Income
                                   (Unaudited)

                                                                                                    Three Months Ended
                                                                                                         March 31
                                                                                          ------------------- -------------------
                                                                                                 2005                 2004
                                                                                          ------------------- -------------------
  Interest and Dividend Income
<S>                                                                                          <C>                 <C>
       Loans                                                                                 $  3,364,481        $  3,448,091
       Investment securities                                                                       25,717              35,827
       Dividends on Federal Home Loan Bank stock                                                   39,647              44,684
       Deposits with financial institutions                                                        59,122              25,748
                                                                                          ------------------- -------------------
           Total interest and dividend income                                                   3,488,967           3,554,350
                                                                                          ------------------- -------------------

  Interest Expense
       Deposits                                                                                 1,190,842           1,177,891
       Federal Home Loan Bank advances                                                            431,254             420,266
                                                                                          ------------------- -------------------
           Total interest expense                                                               1,622,096           1,598,157
                                                                                          ------------------- -------------------

  Net Interest Income                                                                           1,866,871           1,956,193
       Provision for loan losses                                                                   60,000             110,047
                                                                                          ------------------- -------------------
  Net Interest Income After Provision for Loan Losses                                           1,806,871           1,846,146
                                                                                          ------------------- -------------------

  Other Income
       Service charges on deposit accounts                                                         66,690              37,592
       Equity in losses of limited partnerships                                                  (114,000)                 --
       Other income                                                                               148,693             121,309
                                                                                          ------------------- -------------------
           Total other income                                                                     101,383             158,901
                                                                                          ------------------- -------------------

  Other Expenses
       Salaries and employee benefits                                                             839,806             746,153
       Net occupancy expenses                                                                      91,600              80,686
       Equipment expenses                                                                          79,486              90,231
       Legal and professional fees                                                                 71,719              95,627
       Data processing fees                                                                       105,353             101,190
       Other expenses                                                                             292,592             274,650
                                                                                          ------------------- -------------------
           Total other expenses                                                                 1,480,556           1,388,537
                                                                                          ------------------- -------------------

  Income Before Income Tax                                                                        427,698             616,510
       Income tax expense                                                                         139,000             172,900
                                                                                          ------------------- -------------------

  Net Income                                                                                 $    288,698        $    443,610
                                                                                          =================== ===================



  Basic Earnings per Share                                                                   $        .16        $        .23
  Diluted Earnings per Share                                                                          .16                 .23
  Dividends per Share                                                                                 .15                 .15
</TABLE>


  See notes to consolidated condensed financial statements.




                                       5
<PAGE>
<TABLE>
<CAPTION>

                     UNION COMMUNITY BANCORP AND SUBSIDIARY
            Consolidated Condensed Statement of Shareholders' Equity
                    For the Three Months Ended March 31, 2005
                                   (Unaudited)




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

<S>               <C>            <C>        <C>                       <C>           <C>       <C>           <C>         <C>
Balances, January 1, 2005        1,928,000  $20,654,353               $14,401,571   $ (7,615) $(1,137,566)  $(473,801)  $33,436,942
Comprehensive income
  Net income for the period                                $288,698       288,698                                           288,698
    Other comprehensive
      income, net of tax
        Unrealized losses on
          securities                                        (25,491)                 (25,491)                               (25,491)
                                                          ----------
Comprehensive income                                       $263,207
                                                          ==========
Cash dividends ($.15 per
  share)                                                                 (273,786)                                         (273,786)
Stock options exercised             11,000      161,800                                                                     161,800
Amortization of unearned
  compensation expense                            3,668                                                        24,952        28,620
ESOP shares earned                               17,126                                            22,115                    39,241
                                ----------- -----------               -----------  --------- ------------ -----------  -------------
Balances, March 31, 2005         1,939,000  $20,836,947               $14,416,483   $(33,106) $(1,115,451)  $(448,849)  $33,656,024
                                =========== ===========               ===========  ========= ============ ===========  =============

</TABLE>


See notes to consolidated condensed financial statements.


                                       6
<PAGE>
<TABLE>
<CAPTION>



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

                                                                                                  Three Months Ended
                                                                                                       March 31,
                                                                                              ---------------- ---------------
                                                                                                   2005             2004
                                                                                              ---------------- ---------------
  Operating Activities
<S>                                                                                           <C>              <C>
       Net income                                                                             $     288,698    $     443,610
       Adjustments to reconcile net income to net cash provided by operating activities
         Provision for loan losses                                                                   60,000          110,047
         Depreciation and amortization                                                               84,090           93,158
         Investment securities accretion, net                                                           (91)            (116)
         Loss (gain) on sale of real estate owned                                                    (4,120)          43,333
         Gain on sale of premises and equipment                                                        ----          (22,746)
         Amortization of purchase accounting adjustments                                              6,118            9,334
         Amortization of unearned compensation expense                                               28,620           26,146
         ESOP shares earned                                                                          39,241           39,648
         Net change in:
           Interest receivable                                                                      (31,248)         (18,819)
           Interest payable                                                                        (174,857)        (149,730)
         Other adjustments                                                                          188,583          193,138
                                                                                              ---------------- ---------------
                Net cash provided by operating activities                                           485,034          767,003
                                                                                              ---------------- ---------------

  Investing Activities
       Net change in interest-bearing deposits                                                         ----       (2,000,000)
       Investment securities
           Proceeds from maturities and sales of investment securities available for sale              ----        1,000,000
           Proceeds from maturities of securities held to maturity and paydowns of mortgage-
             backed securities                                                                       21,033          178,384
       Net changes in loans                                                                      (6,129,485)      (2,684,852)
       Additions to real estate owned                                                                 6,666           (2,645)
       Proceeds from real estate sales                                                               80,000          188,160
       Purchases of property and equipment                                                           (9,048)         (46,426)
       Proceeds from sale of premises and equipment                                                    ----          264,130
       Other investment activities                                                                   47,101             ----
                                                                                              ---------------- ---------------
                Net cash used in investing activities                                            (5,983,733)      (3,103,249)
                                                                                              ---------------- ---------------

  Financing Activities
       Net change in
         Interest-bearing demand and savings deposits                                              (901,215)      (2,514,075)
         Certificates of deposit                                                                     74,554        5,764,184
       Proceeds from borrowings                                                                   5,000,000             ----
       Repayment of borrowings                                                                         ----         (252,892)
       Cash dividends                                                                              (272,136)        (296,565)
       Stock options exercised                                                                      161,800             ----
       Net change in advances by borrowers for taxes and insurance                                  323,887          106,009
                                                                                              ---------------- ---------------
                Net cash provided by financing activities                                         4,386,890        2,806,661
                                                                                              ---------------- ---------------

  Net Change in Cash and Cash Equivalents                                                        (1,111,809)         470,415

  Cash and Cash Equivalents, Beginning of Period                                                 13,488,014       11,888,342
                                                                                              ---------------- ---------------

  Cash and Cash Equivalents, End of Period                                                    $  12,376,205    $  12,358,757
                                                                                              ================ ===============

  Additional Cash Flows Information
       Interest paid                                                                          $   1,796,953    $   1,747,887
       Income tax paid                                                                              175,000           12,583
       Loans transferred to foreclosed real estate                                                  198,805          211,866
</TABLE>

  See notes to consolidated condensed financial statements.

                                       7
<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 Consolidated Financial Statements included in
the 2004 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 March 31, 2005,  and for the
three months ended March 31, 2005 and 2004, 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  three-month  period ended March 31, 2005, 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, 2004
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>
                                                                                        Weighted-
              For the Three Months Ended March 31, 2005                                  Average         Per Share
                                                                       Income            Shares           Amount
       Basic earnings per share
<S>                                                                    <C>               <C>                <C>
            Income available to common stockholders                    $288,698          1,785,497          $0.16

       Effect of dilutive stock options                                                     29,107
                                                                 ------------------- ---------------- ----------------

       Diluted earnings per share
            Income available to common stockholders
             and assumed conversions                                   $288,698          1,814,604          $0.16
                                                                 =================== ================ ================



                                                                                        Weighted-
              For the Three Months Ended March 31, 2004                                  Average         Per Share
                                                                       Income            Shares           Amount
       Basic earnings per share
            Income available to common stockholders                    $443,610          1,937,973          $0.23

       Effect of dilutive stock options                                                     31,129
                                                                 ------------------- ---------------- ----------------

       Diluted earnings per share
            Income available to common stockholders
             and assumed conversions                                   $443,610          1,969,102          $0.23
                                                                 =================== ================ ================
</TABLE>



Options  to  purchase  97,175  shares of common  stock at $18.15  per share were
outstanding  at March 31,  2005,  but were not  included in the  computation  of
diluted earnings per share because the option price was greater than the average
market price of the common shares.

                                       8
<PAGE>

Note 3: 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,
2004 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     Three Months Ended March
                                                                             March 31, 2005               31, 2004
                                                                        -----------------------------------------------------
<S>                                                                             <C>                     <C>
            Net income, as reported                                             $288,698                $443,610
            Less:  Total stock-based employee compensation cost
               determined under the fair value based method, net of
               income taxes                                                       21,888                   5,133
                                                                        -----------------------------------------------------

            Pro forma net income                                                $266,810                $438,477
                                                                        =====================================================

            Earnings per share:
                Basic - as reported                                             $    .16                $    .23
                Basic - pro forma
                                                                                $    .15                $    .23
                Diluted - as reported
                                                                                $    .16                $    .23
                Diluted - pro forma
                                                                                $    .15                $    .22
</TABLE>

In December,  2004, the Financial  Accounting  Standards  Board (FASB) issued an
amendment  to SFAS 123 (SFAS 123R) which  eliminates  the ability to account for
share-based compensation  transactions using Accounting Principles Board Opinion
No. 25 and generally  requires that such  transactions  be accounted for using a
fair value-based  method.  SFAS 123R will be effective for the Company beginning
January 1, 2006.  SFAS123R  applies to all  awards  granted  after the  required
effective  date and to awards  modified,  repurchased,  or cancelled  after that
date. The cumulative  effect of initially  applying this  Statement,  if any, is
recognized as of the required effective date.

As of the required effective date, the Company will apply SFAS 123R using either
the modified  version of  prospective  application  or the  modified  version of
retrospective  application.  Under prospective  transition method,  compensation
cost is  recognized on or after the required  effective  date for the portion of
outstanding  awards for which the requisite  service has not yet been  rendered,
based on the grant-date fair value of those awards calculated under SFAS 123 for
either  recognition  or pro forma  disclosures.  For periods before the required
effective date, a company may elect to apply a modified version of retrospective
application under which financial statements for prior periods are adjusted on a
basis  consistent with the pro forma  disclosures  required for those periods by
SFAS 123.

The  Company  is  currently   evaluating  the  effect  of  the  recognition  and
measurement  provisions of SFAS 123R but believes the adoption of SFAS 123R will
not result in a  material  impact on the  Company's  results  of  operations  or
financial condition.


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.  became a subsidiary of Union Federal
until it was dissolved in 2004.

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 additional 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.

                                       9
<PAGE>

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.

Union Federal  previously had two wholly-owned  subsidiaries.  MSA Service Corp.
("MSA") engaged in real estate  development for the construction of a seven-unit
condominium  project  located  in  Crawfordsville,   Indiana.   Union  Federal's
investment in MSA was excluded from the calculation of regulatory  capital under
OTS  regulations.   During  the  second  quarter  of  2004,  MSA's   condominium
development  was completed and the remaining  assets of MSA were  transferred to
Union Federal.  Effective as of June 23, 2004, MSA was dissolved.  Union Federal
also owns UFS Service  Corp.  ("UFS"),  whose sole asset was its  investment  in
Pedcor 1993,  which 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"). UFS
did not engage in any activity or hold any assets other than its  investment  in
Pedcor.  During the second  quarter of 2004,  the assets and  liabilities of UFS
were  transferred  to Union  Federal  and Union  Federal  is in the  process  of
voluntarily dissolving UFS.

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 of the Notes to Consolidated Financial Statements,  presented on pages 26
through 29 of the 2004  Annual  Report to  Shareholders  filed on March 29, 2005
with the Company's  Form 10-K for the year ended  December 31, 2004,  contains a
summary  of the  Company's  significant  accounting  policies.  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.

                                       10
<PAGE>

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 2004 and it was  management's  opinion that
there was no impairment to these intangible assets as of the date of the review.


Financial Condition

Total assets  increased  $4.4  million to $261.3  million at March 31, 2005 from
$256.9 million at December 31, 2004. Net loans  increased $5.9 million to $222.9
million at March 31, 2005. Cash and cash equivalents decreased $1.1 million from
December 31, 2004 to March 31, 2005.  Investment  securities  available for sale
decreased  $42,000  during  the  three  month  period.  Premises  and  equipment
decreased  $70,000 to $4.1 million at March 31,  2005.  In  connection  with the
Montgomery acquisition, the balance of goodwill and core deposit intangibles are
$2.4  million and  $299,000  respectively.  Goodwill is  reviewed  annually  for
impairment and core deposit intangibles are being amortized.  Deposits decreased
by $827,000 to $187.6  million and borrowed  funds  increased by $5.0 million to
$37.9 million during the first quarter of 2004.  These borrowings were primarily
used to fund loan growth.

Shareholders'  equity increased $219,000 to $33.7 million at March 31, 2005. The
increase  was  primarily  due to net income for the three months ended March 31,
2005 of  $289,000,  Employee  Stock  Ownership  Plan  shares  earned of $39,000,
unearned  compensation  amortization  of $28,000,  stock  options  exercised  of
$162,000  offset by unrealized  loss on available for sale securities of $25,000
and cash dividends of $274,000.


Comparison  of  Operating  Results for the Three Months Ended March 31, 2005 and
2004

Net income decreased $155,000 from $444,000 for the three months ended March 31,
2004 to  $289,000  for the three  months  ended  March 31,  2005.  The return on
average  assets for the three months  ended March 31, 2005 was .45%  compared to
..68% for the  comparable  period in 2004.  The return on average  equity for the
three months ended March 31, 2005 was 4.26% compared to 3.44% for the comparable
period in 2004.

For the three months ended March 31, 2005,  interest  income was $3.5 million as
compared to $3.6  million for the three  months ended March 31, 2004, a decrease
of $65,000.  Interest income decreased  primarily due to a decrease in the yield
on interest-earning assets from 5.82% during the 2004 period to 5.81% during the
2005  period  and a decrease  in average  interest-earning  assets  from  $244.3
million at March 31, 2004 to $240.4  million at March 31, 2005.  The decrease in
average  interest-earning  assets  was due to a  decrease  in  other  investment
securities  of $2.5 million and a decrease in loans  receivable of $1.5 million.
For the three months ended March 31, 2005,  interest  expense was  $1,622,000 as
compared to  $1,598,000  for the three  months  ended March 31,  2004.  Interest
expense increased  primarily due to an increase in the cost of  interest-bearing
liabilities  from 2.90%  during the 2004 period to 2.96%  during the 2005 period
partially  offset by a decrease  in average  interest-bearing  liabilities  from
$220.5  million  at March 31,  2004 to $219.1  million  at March 31,  2005.  The
amortization of purchase  accounting  adjustments  reduced  interest  expense by
$27,000 in both the 2004 and 2005 reporting periods.

The  provision  for loan  losses for the three  months  ended March 31, 2005 was
$60,000 as compared to $110,000 for the  comparable  period in 2004.  During the
three month  period  ending March 31, 2004 a charge to the loan loss reserve was
made in the amount of $135,000 to write down a  participation  loan secured by a
nursing home. Upon review of the loan portfolio  including  classified  loans it
was  determined  the balance in the  allowance  for loan losses was  adequate at
March 31, 2005.

Total other income decreased by $58,000 from $159,000 for the three months ended
March 31, 2004 to $101,000 for the 2005 month period due to the  recognition  of
losses  related to investments  in limited  partnerships  offset by increases in
service charges on deposit  accounts and other fee income.  Due to the operating
results  of  the  limited   partnerships,   equity  in  losses  of  the  limited
partnerships  increased to $114,000 for the three months ended March 31, 2005 as
compared  to no losses  recorded  in the first  quarter of 2004.  In addition to
recording  the equity in the losses of these limited  partnerships,  the Company
receives  low income  housing  income tax credits.  Based on expected  occupancy
percentages,  the Company expects to receive full tax credits by 2006. Increases
in services  charges on deposit  accounts of $29,000 and other income of $27,000
were  primarily  due to  increases in services  offered and other  miscellaneous
fees.

Other  expenses  increased  $92,000 from  $1,389,000  for the three months ended
March  31,  2004 to  $1,481,000  for the  comparable  period  in 2005.  Expenses
increased  primarily  due to an increase in salaries  and  employee  benefits of
$94,000.  This increase was due to an increase in employee salaries based on the
annual reviews and normal increases in the cost of benefits,  primarily  medical
insurance, provided to employees.


                                       11
<PAGE>

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 March 31, 2005 Union Federal had $3.5 million in classified loans as compared
to $3.8 million at December 31,  2004.  Union  Federal had $1.5 million and $1.8
million in loans classified as special mention as of March 31, 2005 and December
31, 2004  respectively.  In  addition,  Union  Federal had $1.6 million and $1.7
million of loans  classified as  substandard  at March 31, 2005 and December 31,
2004, respectively. At both March 31, 2005 and at December 31, 2004, $325,000 in
loans was classified as doubtful and no loans were classified as loss for either
period end. At March 31, 2005 and December 31, 2004 all of the  substandard  and
doubtful  loans  totaling   $1,973,000  and   $2,050,000,   respectively,   were
non-accrual  loans.  The allowance for loan losses was $960,000 or .43% of loans
at March 31, 2005 as compared to $910,000 or .42% of loans at December 31, 2004.


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 March
31, 2005, Union Federal had liquid assets of $12.4 million and a liquidity ratio
of 5.6%.


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 December 31, 2004 and 2003, 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.
<TABLE>
<CAPTION>

Union Federal:
                       At December 31, 2004             At December 31, 2003
                 ------------------------------- -------------------------------
Changes In Rates $ Change in NPV % Change in NPV $ Change in NPV % Change in NPV
---------------- --------------- --------------- --------------- ---------------
<S>                <C>               <C>           <C>               <C>
  +300 bp          $ (9,887)         (26)%         $ (13,627)        (34)%
  +200 bp            (5,970)         (16)             (8,638)        (22)
  +100 bp            (2,411)          (6)             (3,835)        (10)
     0 bp                 0            0                   0           0
  -100 bp               115            0               1,037           3

</TABLE>

Management  believes that at March 31, 2005, 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 18-20 of
the Company's 2004 Annual Report to Shareholders filed with the Company's Annual
Report on Form 10-K for the period ended December 31, 2004.


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.

                                       12
<PAGE>

(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 have materially  affected,  or are reasonably likely to
materially affect, the Company's internal control over financial reporting.


PART II. OTHER INFORMATION

Item 1. Legal Proceedings

     Although the Company and its subsidiaries are involved,  from time to time,
     in various legal  proceedings  arising in the ordinary  course of business,
     there are no  material  legal  proceedings  to which they are a party or to
     which their property is subject.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

     None.

Item 3. Defaults Upon Senior Securities

     None.

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

     No matter was submitted to a vote of the Company's  shareholders during the
     first quarter of 2004.

Item 5. Other Information

     None.

Item 6. Exhibits

     Exhibits

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

          31(2)     Certification required by 17 C.F.R. ss. 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


                                       13
<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.

                                         UNION COMMUNITY BANCORP

Date:         May 16, 2005               /s/ Alan L. Grimble
                                         ---------------------------------------
                                         Alan L. Grimble
                                         Chief Executive Officer


Date:         May 16, 2005               /s/ J. Lee Walden
                                         ---------------------------------------
                                         J. Lee Walden
                                         Chief Financial Officer



                                       14