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, 2002

                                       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 [ ]

The  number of shares of the  Registrant's  common  stock,  without  par  value,
outstanding as of March 31, 2002 was 2,443,897.

<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        11

PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings                                                 12
Item 2.   Changes in Securities and Use of Proceeds                         12
Item 3.   Defaults Upon Senior Securities                                   12
Item 4.   Submission of Matters to a Vote of Security Holders               12
Item 5.   Other Information                                                 12
Item 6.   Exhibits and Reports on Form 8-K                                  12

SIGNATURES                                                                  14

<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

                                                                           March 31,      December 31,
                                                                             2002             2001
                                                                       --------------------------------
                                                                                 (Unaudited)
<S>                                                                     <C>              <C>
Assets
     Cash                                                               $   1,017,050    $     375,349
     Interest-bearing demand deposits                                      19,387,553       13,189,553
                                                                       --------------------------------
         Cash and cash equivalents                                         20,404,603       13,564,902
     Interest-bearing deposits                                                139,628
     Investment securities
         Available for sale                                                    23,120
         Held to maturity                                                   2,626,225        2,848,411
                                                                       --------------------------------
              Total investment securities                                   2,649,345        2,848,411
     Loans, net of allowance for loan losses of $938,554 and $519,554     237,881,050      121,749,210
     Premises and equipment                                                 2,860,264          398,857
     Federal Home Loan Bank stock                                           3,423,600        1,530,300
     Investment in limited partnership                                        851,609          856,609
     Foreclosed assets and real estate held for development, net            1,868,285            8,500
     Goodwill                                                               2,260,044
     Interest receivable                                                    1,553,449          903,040
     Other assets                                                           1,725,389          531,599
                                                                       --------------------------------

         Total assets                                                   $ 275,617,266    $ 142,391,428
                                                                       ================================

Liabilities
     Deposits
         Noninterest-bearing                                            $   3,807,417    $   1,397,380
         Interest-bearing                                                 187,791,497       80,304,133
                                                                       --------------------------------
              Total deposits                                              191,598,914       81,701,513
     Federal Home Loan Bank advances                                       42,830,062       25,405,633
     Note payable                                                             302,892          477,142
     Interest payable                                                         495,022          186,119
     Dividends payable                                                        253,200          292,183
     Other liabilities                                                      1,898,926          588,685
                                                                       --------------------------------
         Total liabilities                                                237,379,016      108,651,275
                                                                       --------------------------------

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 - 2,443,897 and 2,100,000 shares           25,673,779       20,547,581
     Retained earnings                                                     14,817,931       15,556,661
     Accumulated other comprehensive income                                       975
     Unearned employee stock ownership plan (ESOP) shares                  (1,396,433)      (1,420,777)
     Unearned recognition and retention plan (RRP) shares                    (858,002)        (943,312)
                                                                       --------------------------------
         Total shareholders' equity                                        38,238,250       33,740,153
                                                                       --------------------------------

         Total liabilities and shareholders' equity                     $ 275,617,266    $ 142,391,428
                                                                       ================================
</TABLE>

  See notes to consolidated condensed financial statements.

<PAGE>

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

                                                                        Three Months Ended
                                                                             March 31
                                                                   ----------------------------
                                                                        2002           2001
                                                                   ----------------------------
<S>                                                                 <C>            <C>
Interest and Dividend Income
     Loans                                                          $ 4,425,209    $ 2,171,769
     Investment securities                                               48,890        119,196
     Dividends on Federal Home Loan Bank stock                           50,651         22,990
     Deposits with financial institutions                                68,524         77,877
                                                                   ----------------------------
         Total interest and dividend income                           4,593,274      2,391,832
                                                                   ----------------------------

Interest Expense
     Deposits                                                         1,695,338      1,031,349
     Federal Home Loan Bank advances                                    412,062        219,022
                                                                   ----------------------------
         Total interest expense                                       2,107,400      1,250,371
                                                                   ----------------------------

Net Interest Income                                                   2,485,874      1,141,461
     Provision for loan losses                                           40,000         15,000
                                                                   ----------------------------
Net Interest Income After Provision for Loan Losses                   2,445,874      1,126,461
                                                                   ----------------------------

Other Income (Losses)
     Equity in losses of limited partnerships                            (5,000)       (25,000)
     Net realized gains on sales of available for sale securities         5,960
     Other income                                                       102,898         44,148
                                                                   ----------------------------
         Total other income                                             103,858         19,148
                                                                   ----------------------------

Other Expenses
     Salaries and employee benefits                                     710,834        310,530
     Net occupancy expenses                                              57,465         11,538
     Equipment expenses                                                  71,487          6,472
     Legal and professional fees                                         40,518         31,375
     Data processing fees                                               480,041         18,289
     Other expenses                                                     239,984        118,531
                                                                   ----------------------------
         Total other expenses                                         1,600,329        496,735
                                                                   ----------------------------

Income Before Income Tax                                                949,403        648,874
     Income tax expense                                                 302,480        213,028
                                                                   ----------------------------

Net Income                                                          $   646,923    $   435,846
                                                                   ============================

Basic Earnings per Share                                            $       .30    $       .21

Diluted Earnings per Share                                                  .30            .21

Weighted-Average Shares Outstanding                                   2,166,623      2,077,406

Dividends per Share                                                         .11            .15
</TABLE>

  See notes to consolidated condensed financial statements.

<PAGE>
<TABLE>
<CAPTION>
                                               UNION COMMUNITY BANCORP AND SUBSIDIARY
                                      Consolidated Condensed Statement of Shareholders' Equity
                                             For the Three Months Ended March 31, 2002
                                                            (Unaudited)


                                     Common Stock                                Accumulated
                                 ---------------------                              Other     Unearned
                                   Shares               Comprehensive  Retained Comprehensive   ESOP      Unearned
                                 Outstanding    Amount     Income      Earnings     Income     Shares   Compensation      Total
                                 -------------------------------------------------------------------------------------------------
<S>                                <C>        <C>                    <C>                   <C>           <C>           <C>
Balances, January 1, 2002          2,100,000  $20,547,581            $15,556,661           $(1,420,777)  $ (943,312)   $33,740,153

Comprehensive income
  Net income for the period                              $  646,923      646,923                                           646,923
    Other comprehensive
      income, net of tax
      Unrealized gains on
        securities, net of
        reclassification
        adjustment                                              975                 $  975                                     975
                                                        ------------
  Comprehensive income                                   $  647,898
                                                        ============
  Cash dividends ($.11 per share)                                       (253,200)                                         (253,200)
  Shares issued in acquisition, net
   of cost                           678,897    8,954,487                                                                8,954,487
  Shares cancelled in acquisition    (20,000)    (257,111)                                                                (257,111)
  Purchase of common  stock         (315,000)  (3,581,547)            (1,132,453)                                       (4,714,000)
  Amortization of unearned
  compensation expense                                                                                       85,310         85,310
  ESOP shares earned                               10,369                                       24,344                      34,713
                                  ------------------------          ---------------------------------------------------------------
Balances, March 31, 2002           2,443,897  $25,673,779            $14,817,931    $  975  (1,396,433)   $(858,002)   $38,238,250
                                  ========================          ===============================================================

</TABLE>

See notes to consolidated condensed financial statements.

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

                                                                                                 Three Months Ended
                                                                                                      March 31,
                                                                                            ------------------------------
                                                                                                2002             2001
                                                                                            ------------------------------
<S>                                                                                          <C>             <C>
Operating Activities
     Net income                                                                              $    646,923    $    435,846
     Adjustments to reconcile net income to net cash provided by operating activities
       Provision for loan losses                                                                   40,000          15,000
       Depreciation and amortization                                                               76,871           7,468
       Investment securities accretion, net                                                          (825)           (840)
       Gain on sale of investment securities available for sale                                    (5,960)
       Loss on sale of real estate owned                                                           10,938
       Equity in losses of limited partnerships                                                     5,000          25,000
       Amortization of purchase accounting adjustments                                           (226,668)
       Amortization of unearned compensation expense                                               85,310          56,867
       ESOP shares earned                                                                          34,713          32,906
       Net change in:
         Interest receivable                                                                       24,255          74,071
         Interest payable                                                                        (207,500)        (54,084)
       Other adjustments                                                                        1,537,446         (72,550)
                                                                                            ------------------------------
              Net cash provided by operating activities                                         2,020,503         519,684
                                                                                            ------------------------------

Investing Activities
     Net change in interest-bearing deposits                                                      100,000
     Investment securities
         Proceeds from sales of investment securities available for sale                           51,534
         Proceeds from maturities of securities held to maturity and paydowns of mortgage-
         backed securities                                                                        223,011       1,875,095
     Net changes in loans                                                                         774,316          13,163
     Net cash received in acquisition                                                          15,866,825
     Additions to real estate owned                                                               (34,584)
     Proceeds from real estate sales                                                               92,812
     Purchases of property and equipment                                                           (4,702)        (40,428)
     Purchases of Federal Home Loan Bank of Indianapolis stock                                                   (137,000)
                                                                                            ------------------------------
              Net cash provided by investing activities                                        17,069,212       1,710,830
                                                                                            ------------------------------

Financing Activities
     Net change in
       Interest-bearing demand and savings deposits                                             8,863,199       1,593,375
       Certificates of deposit                                                                (16,125,199)      1,233,396
     Proceeds from borrowings                                                                  20,000,000       4,000,000
     Repayment of borrowings                                                                  (20,311,993)     (6,306,660)
     Cash dividends                                                                              (292,183)       (326,783)
     Repurchase of common stock                                                                (4,714,000)       (976,775)
     Net change in advances by borrowers for taxes and insurance                                  330,162         154,291
                                                                                            ------------------------------
              Net cash used by financing activities                                           (12,250,014)       (629,156)
                                                                                            ------------------------------

Net Change in Cash and Cash Equivalents                                                         6,839,701       1,601,358

Cash and Cash Equivalents, Beginning of Period                                                 13,564,902       4,754,686
                                                                                            ------------------------------

Cash and Cash Equivalents, End of Period                                                     $ 20,404,603    $  6,356,044
                                                                                            ==============================

Additional Cash Flows Information
     Interest paid                                                                           $  2,314,900    $  1,304,455
     Income tax paid                                                                               62,000         287,000

</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, 2001 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, 2002,  and for the
three months ended March 31, 2002 and 2001, 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, 2002, 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, 2001
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.  Options to
purchase  186,000  shares of common stock were excluded from the  computation of
diluted earnings per share because the options'  exercise price was greater than
or equal to the average prices of common shares.

Note 3: Other Comprehensive Income
<TABLE>
<CAPTION>
                                                                      Before-Tax           Tax          Net-of-Tax
       For the Three Months Ended March 31, 2002                        Amount           Expense          Amount
                                                                        ------           -------          ------
<S>                                                                     <C>            <C>                <C>
         Unrealized gains on securities:
            Unrealized holding gains arising during the year            $ 7,575        $ (3,001)          $ 4,574
            Less: reclassification adjustments for gains realized
              in net income                                               5,960          (2,361)            3,599
                                                                       -------------------------------------------
         Other comprehensive income                                     $ 1,615        $   (640)          $   975
                                                                       ===========================================
</TABLE>


Note 4: Business Combination

On January 2, 2002,  the Company  acquired  Montgomery  Financial  Corporation a
federally  chartered  thrift  ("Montgomery"),  which is the  holding  company of
Montgomery Savings, a Federal Association ("Montgomery Savings"). Montgomery was
merged with and into the Company and immediately  thereafter  Montgomery Savings
was merged into Union  Federal.  MSA  Service  Corporation  ("MSA"),  an Indiana
corporation and wholly-owned  subsidiary of Montgomery Savings, will continue as
a subsidiary of Union Federal.

On January 2, 2002,  the company  issued 678,897 shares of its common stock at a
cost of approximately  $8,954,000,  net of registration  costs of $113,000,  and
paid cash of approximately  $9,059,000 to Montgomery's  shareholders.  As of the
merger date, Montgomery owned 20,000 shares of the Company's common stock with a
net book value of approximately  $257,000.  The shares were cancelled as part of
this  transaction.  The Company paid an  additional  $452,000 in merger  related
expenses.

The acquisition  was accounted for under the purchase method of accounting,  and
accordingly,  the net assets were recorded at their estimated fair values at the
date of  acquisition.  Fair value  adjustments  on the  assets  and  liabilities
purchased are being  amortized  over the  estimated  useful lives of the related
assets and liabilities. The excess of the purchase price over the estimated fair
value of the  underlying  net assets of $2,260,000 was allocated to goodwill and
is not deductible for tax purposes.  Additionally,  core deposit  intangibles of
$590,000 were recognized and are being amortized over seven years using the 125%
declining  balance  method.  Montgomery's  results of  operations  and financial
position  were  included  in the  Company's  consolidated  financial  statements
beginning  January 3, 2002.  The following  table  summarizes the estimated fair
values  of  the  assets  acquired  and  liabilities   assumed  at  the  date  of
acquisition.

<PAGE>

                                                      (In thousands)
               Cash and cash equivalents                 $ 25,490
               Loans, net of allowance for loan losses    117,029
               Premises and equipment                       2,530
               Goodwill                                     2,260
               Core deposit intangible                        590
               Other assets                                 6,564
                                                        ----------
                        Total assets acquired             154,463
                                                        ----------

               Deposits                                   117,390
               Federal Home Loan Bank advances             17,607
               Other liabilities                            1,145
                                                        ----------
                        Total liabilities acquired        136,142
                                                        ----------

                        Net assets acquired              $ 18,321
                                                        ==========

The  following  pro forma  information,  including  the  effect of the  purchase
accounting  adjustments,  depicts the results of operations as though the merger
had take place at the beginning of each period.

                                                      Three Months Ended
                                                           March 31,
                                                     2002            2001
                                                     ----            ----
                                                        (In thousands)
               Net Interest Income                $   2,486        $2,320
               Net Income (Loss)                       (313)          678
               Net Income (Loss) Per Share
                        Basic                          (.14)          .25
                        Diluted                        (.14)          .25

The pro forma  results of  operations  do not  purport to be  indicative  of the
results which would  actually have been obtained had the merger  occurred on the
date indicated or which may be obtain in the future.

The Financial Accounting Standards Board recently adopted Statement of Financial
Accounting  Standards ("SFAS") 142, Goodwill and Other Intangible  Assets.  This
Statement  establishes  new financial  accounting  and  reporting  standards for
acquired  goodwill and other  intangible  assets.  The  Statement  addresses how
intangible assets that are acquired individually or with a group of other assets
(but not those  acquired in a business  combination)  should be accounted for in
financial statements upon their acquisition.  It also addresses how goodwill and
other intangible  assets  (including  those acquired in a business  combination)
should be  accounted  for  after  they have  been  initially  recognized  in the
financial  statements.  SFAS 142 was effective for fiscal years  beginning after
December 15,  2001.  In adopting  SFAS 142, the goodwill  recorded on January 2,
2002 from the  acquisition of Montgomery  will not be amortized but will subject
to testing for impairment.

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 in a transaction  that closed on
January 2, 2002.  In the  transaction,  Montgomery  was merged with and into the
Company,  and  Montgomery  Savings  was  merged  with  and into  Union  Federal.
Following the merger, MSA became a subsidiary of Union Federal.

<PAGE>

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 three additional branch
offices in  Crawfordsville  and branch  offices in Covington,  Williamsport  and
Lafayette,  Indiana.  Five of the above  mentioned  branch offices were added in
connection  with  the  acquisition  of  Montgomery.  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,   including:   (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 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,
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, 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.

Financial Condition

Total  assets  increased  $133.2  million to $275.6  million  at March 31,  2002
primarily due to the  acquisition  of  Montgomery.  Net loans  increased  $116.1
million to $237.9  million at March 31, 2002.  During the first quarter of 2002,
net loans of $117.0 million were added as a result of the acquisition while loan
payoffs exceeded new loan  production,  net of other  adjustments,  by $897,000.
Cash and cash equivalents increased $6.8 million from December 31, 2001 to March
31, 2002.  The increase was primarily  due net cash received in the  acquisition
offset by cash used for stock repurchases. Premises and equipment increased from
$399,000 at December  31, 2001 to $2.9 million at March 31, 2002 also due to the
acquisition.   The   acquisition  of  Montgomery   increased   Union   Federal's
full-service  offices  from two to  seven.  Due to the  transaction,  foreclosed
assets and real estate held for  development  increased  from $9,000 at December
31, 2001 to $1.9 million at March 31, 2002. In connection with the  acquisition,
these  properties  were  marked to market and are  currently  for sale.  Also in
connection  with the  acquisition,  goodwill of $2.3  million  and core  deposit
intangibles  of $590,000 were recorded.  Goodwill will be reviewed  annually for
impairment and core deposit intangibles will be amortized over seven years.

Deposits  increased by $106.9 million to $188.6 million during the first quarter
of 2002.  $117.4 million were added as a result of the  Montgomery  acquisition.
Excluding  the  deposit   acquired,   deposits   decreased   $7.5  million  with
certificates  of  deposits  decreasing  approximately  $16.0  million  and other
deposits increasing approximately $9.0 million.

Borrowed  funds  increased by $17.3  million from December 31, 2001 to March 31,
2002. $17.6 million were added as a result of the Montgomery acquisition.

Stockholders'  equity increased $4.5 million to $38.2 million at March 31, 2002.
The increase  was  primarily  due to shares  issued in the  acquisition,  net of
costs,  of $9.0  million,  net income for three  months  ended March 31, 2002 of
$647,000,  Employee  Stock  Ownership Plan shares earned of $35,000 and unearned
compensation  amortization  of  $85,000.  These  increases  were offset by stock
repurchases  of $4.7 million,  cancellation  of shares of Company stock owned by
Montgomery of $257,000 and cash dividends of $253,000.

Comparison  of  Operating  Results for the Three Months Ended March 31, 2002 and
2001

Net income  increased  $211,000,  or 48.4%,  from  $436,000 for the three months
ended March 31, 2001 to $647,000 for the three months ended March 31, 2002.  The
increase  in  net  income  was  primarily  attributable  to the  acquisition  of
Montgomery  on January 2, 2002 with an increase of $1.3  million in net interest
income offset by an increase of $1.1 million in total other expenses. The return
on average assets for the three months ended March 31, 2002 was .94% compared to
1.37% for the  comparable  period in 2001.  The return on average equity for the
three months ended March 31, 2002 was 6.47% compared to 4.83% for the comparable
period in 2001.

For the three months ended March 31, 2002,  interest  income was $4.6 million as
compared to $2.4 million for the three  months  ended March 31,  2001.  Interest
income increased primarily due to an increase in average  interest-earning asset
from $124.7 million at March 31, 2001 to $263.3 million at March 31, 2002 offset
by a decrease in the yield on interest-earning assets from 7.67% during the 2001
period to 6.98%  during the 2002  period.  For the three  months ended March 31,
2002,  interest  expense was $2.1  million as  compared to $1.3  million for the
three months ended March 31, 2001.  Interest expense increased  primarily due to
an increase in average interest-bearing  liabilities from $89.0 million at March
31, 2001 to $228.7 million at March 31, 2002 offset by a decrease in the cost of
interest-bearing  liabilities  from 5.62% during the 2001 period to 3.69% during
the  2002  period.  The  decrease  in the  cost of  funds  was  due to the  rate
environment   during  the  first  quarter  of  2002  as  compared  to  2001  and
amortization  of  purchase  accounting   adjustments   totaling  $276,000  which
decreased interest expense during the first quarter of 2002.


<PAGE>

The  provision  for loan  losses for the three  months  ended March 31, 2002 was
$40,000 as compared to $15,000 for the  comparable  period in 2001.  A review is
performed  quarterly  to determine  the  adequacy of the current  balance in the
allowance for loan losses.

Total other  expenses  increased  from $497,000 for the three months ended March
31, 2001 to $1,601,000 for the comparable period in 2002.  Expenses increased in
part due to the growth of the Company  through the acquisition of Montgomery and
due to a one-time $411,000  termination fee for data processing services charged
to expense during the first quarter of 2002.

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.
Union Federal had no loans  classified  as special  mention as of March 31, 2002
and December 31, 2001 respectively.  In addition, Union Federal had $4.3 million
and $1.6  million  of loans  classified  as  substandard  at March 31,  2002 and
December 31,  2001,  respectively.  At March 31, 2002 and December 31, 2001,  no
loans were classified as doubtful or loss. The increase in classified  loans was
primarily  due to the  addition of $1.3  million in  substandard  loans from the
Montgomery  acquisition  and $1.2 million of additional  substandard  loans to a
single borrower secured by 11 properties with favorable loan to value ratios. At
March 31, 2002, and December 31, 2001,  respectively,  $3.1 million and $682,000
of the substandard  loans were non-accrual  loans. The allowance for loan losses
was  $939,000 or .39% of loans at March 31, 2002 as compared to $520,000 or .43%
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 March
31, 2002, Union Federal had liquid assets of $20.3 million and a liquidity ratio
of 8.9%.

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, 2001 and 2000, is the most recent available
analyses  performed  by the  OTS of  Union  Federal's  and  Montgomery  Savings'
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, 2001                      At December 31, 2000
                            --------------------                      --------------------
 Changes In Rates    $ Change in NPV       % Change in NPV      $ Change in NPV    % Change in NPV
 ----------------    ---------------       ---------------      ---------------    ---------------
     <S>                <C>                       <C>             <C>                     <C>
     +300 bp            $ (7,734)                 (31)%           $ (7,835)               (22)%
     +200 bp              (5,185)                 (20)              (5,198)               (14)
     +100 bp              (2,507)                 (10)              (,2511)                (7)
        0 bp                   0                    0                    0                  0
     -100 bp               1,424                    6                1,897                  5
     -200 bp                  --                   --                3,226                  9
     -300 bp                  --                   --                4,780                 13



<PAGE>

 Montgomery Savings:
                            At December 31, 2001                      At December 31, 2000
                            --------------------                      --------------------
 Changes In Rates    $ Change in NPV       % Change in NPV      $ Change in NPV    % Change in NPV
 ----------------    ---------------       ---------------      ---------------    ---------------
     +300 bp            $ (7,273)                 (32)%           $ (5,549)               (29)%
     +200 bp              (4,663)                 (20)              (3,463)               (18)
     +100 bp              (2,123)                  (9)              (1,524)                (8)
        0 bp                   0                    0                    0                  0
     -100 bp               1,134                    5                1,571                  8
     -200 bp                  --                   --                2,678                 14
     -300 bp                  --                   --                3,630                 19
</TABLE>

As  discussed  in Note 4,  Montgomery  Savings  was  merged  with and into Union
Federal on January 2, 2002.  Presented  below,  as of December  31,  2001,  is a
combination  of the above  analyses  performed by the OTS for Union  Federal and
Montgomery Savings.

<TABLE>
<CAPTION>
                                          December 31, 2001
                                          -----------------
                                Net Portfolio Value                       NPV as % of PV of Assets
    Changes
    In Rates        $ Amount         $ Change          % Change            NPV Ratio          Change
    --------        --------         --------          --------            ---------          ------
   <S>                 <C>          <C>                  <C>                <C>              <C>
   +300 bp             33,154       $ (15,006)           (31)%              11.54%           (411) bp
   +200 bp             38,306          (9,854)           (20)               13.03            (263) bp
   +100 bp             43,529          (4,631)           (10)               14.46            (120) bp
      0 bp             48,160              --             --                15.65
   -100 bp             50,715           2,555              5                16.23              58  bp
</TABLE>

Management  believes that at March 31, 2002, 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 in Item 7A of the
Company's Annual Report on Form 10-K for the period ended December 31, 2001.


<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.

          None.

Item 5.   Other Information.

          None.

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

          (a)  The  Company  filed a report  on Form  8-K on  January  15,  2002
               reporting the  consummation  of the merger of Montgomery with and
               into the  Company  on  January 2,  2002,  and which  included  as
               Exhibit  99.2  thereto  Unaudited  Pro Forma  Condensed  Combined
               Financial Information of the Company as of September 30, 2001 for
               the nine-month  period ended  September 30, 2001 and for the year
               ended December 31, 2000.


<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 14, 2002                        By: /s/ Joseph E. Timmons
        ------------                        ----------------------------------
                                            Joseph E. Timmons
                                            President


Date:   May 14, 2002                        By: /s/ J. Lee Walden
        ------------                        ----------------------------------
                                            J. Lee Walden
                                            Chief Financial Officer