MARKET PRICE OF WESTERN OHIO FINANCIAL CORPORATION'S
COMMON SHARES AND RELATED SHAREHOLDER MATTERS


     There were 2,029,204 common shares of WOFC outstanding,  excluding unearned
employee  benefit  plan  shares,  on  December  31,  1998,  held  of  record  by
approximately  722 registered  shareholders and 1,700 beneficial  holders behind
brokers,  banks,  and  depositories.  Price  information  with respect to WOFC's
common  shares is quoted  on the  National  Association  of  Securities  Dealers
Automated  Quotation System ("NASDAQ")  National Market System.  The Wall Street
Journal publishes daily trading information for our stock under the abbreviation
"WstrnOHFnl" in the National Market Listing.

<TABLE>
<CAPTION>

                            Fiscal Year 1998           Fiscal Year 1997
                        Low     High    Dividend    Low     High    Dividend      
                       -----  --------- --------   -----  --------- ---------
<S>                    <C>     <C>      <C>       <C>      <C>      <C>

First quarter          $25.00  $27.75   $ .25     $21.00   $22.75    $ .25
Second quarter          24.75   27.00     .25      21.00    22.25      .25
Third quarter           19.75   25.25     .25      21.25    27.13      .25
Fourth quarter          19.75   23.38     .25      24.25    30.63      .25

</TABLE>

The Company has repurchased  shares and intends to continue to repurchase shares
in order to enhance  shareholder  value.  During 1998,  the Company  repurchased
277,500  shares  and  16,500  in 1997.  The  Company  is no  longer  subject  to
quantitative  regulatory limitations imposed by the Office of Thrift Supervision
("OTS") on stock repurchases and intends to continue repurchases of stock.


<PAGE>

<TABLE>
<CAPTION>

                  SELECTED CONSOLIDATED FINANCIAL INFORMATION


                                                            December 31,
                                       ----------------------------------------------------
                                          1998      1997       1996       1995      1994
                                       ---------  ---------  ---------  --------  ---------  
                                                        (In Thousands)
<S>                                    <C>         <C>        <C>       <C>       <C>    
                                                                                                                 
Selected Financial Condition Data:


Total assets                           $ 327,728  $ 371,988  $ 392,765  $ 231,387 $ 185,670       
Loans and loans held for sale, net       234,812    277,731    287,611    150,476   104,269       
Cash and cash equivalents                 13,854     31,239     15,611     17,605    19,951       
Mortgage-backed securities                50,044     22,433     36,843     45,719    40,533       
Securities                                15,402     22,455     35,729     12,039    16,889       
Deposits                                 192,966    246,909    233,203    139,129   117,529       
Borrowed funds                            85,252     68,339    102,602     31,528     3,689       
Total stockholders' equity                47,594     54,600     54,048     59,668    63,358       
                                                                                                                    
Selected Operations Data: 

Total interest income                  $  25,856  $  29,039   $ 24,160   $ 14,809  $ 12,445
Total interest expense                    15,992     17,934     13,783      7,034     5,178
                                       ---------  ---------   --------   --------  --------           
Net interest income                        9,864     11,105     10,377      7,775     7,267
Provision for loan losses                   (363)     2,285        399          6       ---
                                       ---------  ---------   --------   --------  --------
Net interest income after pro-             
 vision for loan losses                   10,227      8,820      9,978      7,769     7,267

Non-interest income: 
 Loan fees and service charges             1,005        650        156         60        53 
 Gain on sales of loans,             
  mortgage-backed securities  
  and securities                             652        311        340      1,207         2
 Gain on sale of branches                  2,054        ---        ---        ---       --- 
 Other non-interest income                   (22)        31         54        713        17  
                                       ---------   --------   --------    -------  --------
                                                                                                                         
Total non-interest income                  3,689        992       550       1,980        72
Total non-interest expense                 9,757      9,471     8,759       5,349     3,346 
Income before income taxes and 
   cumulative effect of accounting      
   changes                                 4,159        341     1,769       4,400     3,993
Income tax expense                         2,864        158       707       1,507     1,366 
                                       ---------   --------   -------     -------  --------                              
                                                              
Net income                             $   1,295   $    183   $ 1,062    $  2,893  $  2,627 
                                       =========   ========    ======    ========  ======== 
                                                                                            
  
</TABLE>

<PAGE>


<TABLE>
<CAPTION>

SELECTED CONSOLIDATED FINANCIAL INFORMATION

                                                               December 31,
                                           -----------------------------------------------
                                           1998         1997      1996     1995      1994 
                                           ----         ----      ----     ----      ----
<S>                                        <C>         <C>        <C>     <C>        <C>

Selected Financial Ratios and Other Data:

Performance Ratios:
 Return on assets (ratio of net income to                                                
  average total assets)                    0.36%        0.05%     0.33%    1.42%    1.53% 
 Interest rate spread information:           
 Average during year                       2.40         2.42      2.42     2.65     3.62
   End of year                             2.55         2.31      2.23     2.05     3.27 
   Net interest margin                     2.91         2.95      3.26     4.01     4.40
 Ratio of operating expense to                
  average total assets                     2.69         2.39      2.72     2.63     1.95
 Return on retained earnings (ratio of       
  net income to average equity)            2.42         0.34      2.00     4.72     7.92
                                                                                                  
Quality Ratios:                                                                                   
 Non-performing assets to total assets at       
  end of year                              1.39         0.54      0.52     0.01     0.04
 Allowance for loan losses to              
  non-performing loans                    70.47       196.59     83.95   255.45 1,032.00
 Allowance for loan losses to total        
  loans, net                               1.39         1.41      0.60     0.51     0.74 
 Allowance for loan losses to                                                                     
  classified assets                       68.89       130.08     73.74    87.66   110.73 
                                              
Capital Ratios:                               
 Total equity to total assets at end                                                              
  of year                                 14.52        14.67     13.76    25.79    34.13
 Average equity  to average assets        14.80        13.44     16.50    30.07    19.31 
 Ratio of average interest-earning assets                                                                              
  to average interest-bearing liabilities  1.11x        1.11x     1.19x    1.37x    1.25x 
                                            
Per Share Data:                                 
 Earnings per share-Basic                   0.60        0.08      0.47    1.18     0.42 
 Earnings per share-Diluted                 0.58        0.08      0.46    1.15     0.42
 Dividend payout ratio                      1.67       12.50      2.13    0.85     0.30
 Book value per share                      23.45       22.91     23.48   25.27    25.32
                                           
Number of full service offices                 6       10        10       5        5
</TABLE>



<PAGE>



MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
GENERAL

As a  unitary  savings  and  loan  association  holding  company,  Western  Ohio
Financial  Corporation  ("the  Company"  or  "WOFC"),   holds  Cornerstone  Bank
("Cornerstone"),   whose  principal  business  has  traditionally  consisted  of
attracting  deposits  from the  general  public,  and  making  loans  secured by
residential  real  estate.  Cornerstone's  profitability  and  consequently  the
Company's  profitability  is primarily  dependent upon its net interest  income,
which is the  difference  between  interest  income  on its loan and  investment
portfolio and interest paid on deposits and other borrowed  funds.  Net interest
income is directly affected by the relative amounts of  interest-earning  assets
and  interest-bearing  liabilities and the interest rates earned or paid on such
amounts. Cornerstone's profitability is also affected by the provisions for loan
losses and the level of  non-interest  income and expense.  Non-interest  income
consists primarily of service charges and other fees, gains (losses) on sales of
securities and other assets and income from real estate operations. Non-interest
expense  includes  salaries  and  employee  benefits,  real  estate  operations,
occupancy of premises, federal deposit insurance premiums, franchise taxes, data
processing expenses and other operating  expenses.  In October 1997, the Company
incorporated another subsidiary,  West Central Mortgage Services,  Incorporated,
("West Central").  The primary business of West Central is to engage in mortgage
banking activities.

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

The Company offers a range of customer services and products,  including deposit
accounts  and loans  with a special  emphasis  on  one-to-four  family  mortgage
lending  and,  to a lesser  extent,  multi-family  and  commercial  real  estate
lending.   Smaller  portions  of  the  Company's  loans  receivable  consist  of
construction, commercial and consumer loans. Management has expanded and intends
to continue to expand its consumer lending  portfolio by soliciting its existing
customer base and has initiated efforts to solicit commercial loans.

Management  and the Board of  Directors  of the  Company  have sought to enhance
shareholder value by repurchasing outstanding shares.


FORWARD-LOOKING STATEMENTS


When used in this  document,  the words or phrases  "will likely  result,"  "are
expected to," "will continue," "is  anticipated,"  "estimated,"  "projected," or
similar expressions are intended to identify "forward looking statements" within
the  meaning of the  Private  Securities  Litigation  Reform  Act of 1995.  Such
statements are subject to certain risks and  uncertainties  including changes in
economic conditions in the Bank's market area, changes in policies by regulatory
agencies,  fluctuations in interest rates, demand for loans in the Bank's market
area and competition,  that could cause actual results to differ materially from
historical earnings and those presently anticipated or projected. Factors listed
above could affect the Company's  financial  performance  and could cause actual
results for future periods to differ  materially  from any statements  expressed
with respect to future periods.

The Company does not undertake,  and specifically  disclaims any obligation,  to
publicly   revise  any   forward-looking   statements   to  reflect   events  or
circumstances  after the date of such statements or to reflect the occurrence of
anticipated or unanticipated events.


<PAGE>


ANALYSIS OF FINANCIAL CONDITION

Total assets of the Company  decreased $44.3 million in the year ending December
31, 1998,  from $372.0 million in 1997 to $327.7 million in 1998.  This decrease
of 11.9% was reflective of reductions in cash and cash  equivalents,  securities
and loans  receivable.  Cash and cash  equivalents  decreased $17.4 million from
$31.2  million at December  31,  1997,  to $13.8  million at December  31, 1998.
Securities  decreased  $7.1 million from $22.5  million at December 31, 1997, to
$15.4  million at December 31,  1998.  The primary  reason for the  reduction in
cash,  cash  equivalents  and  securities  was to fund  the  sale of the  branch
deposits  related to  management's  decision to exit the  Cincinnati  market and
dispose of all four branch locations in the Cincinnati area.

Net loans and loans held for sale  decreased from $277.7 million at December 31,
1997, to $234.8  million at December 31, 1998, a decrease of $42.9  million,  or
15.5%. The decrease was primarily the result of customers  refinancing loans due
to lower rates,  and the Company  selling new  fixed-rate  mortgage loans to the
secondary  market.  Partly  offsetting  the  decrease in net loans,  the Company
increased its investment in  mortgage-backed  securities  $27.6 million to $50.0
million at December 31, 1998, from $22.4 million at December 31, 1997.

Liabilities  decreased  from $317.4  million at  December  31,  1997,  to $280.1
million at December 31, 1998, a decrease of $37.3 million, or 11.7%. The primary
reason for the  reduction  in total  liabilities  was the sale of  approximately
$84.4 million of deposits  associated  with the four branches in the  Cincinnati
area.  Despite the sale of  deposits,  deposits  increased  during 1998 by $30.4
million as a result of continued aggressive advertising and competitive pricing.
For the year,  deposits decreased $53.9 million,  or 21.8%, to $193.0 million at
December 31, 1998,  from $246.9  million at December  31, 1997.  Offsetting  the
deposit decrease, the Company increased advances from the Federal Home Loan Bank
of Cincinnati  ("FHLB") $16.9 million,  or 24.7%, from $68.3 million at December
31, 1997, to $85.2 million at December 31, 1998.  Rates on advances drawn during
the year ranged from 4.52% to 5.52%. The nature of these advances was to replace
a portion of the deposits sold in the Cincinnati area. At December 31, 1998, all
advances were fixed-rate.  The above mentioned advances are secured by a blanket
pledge  of  mortgages  to the FHLB and are not tied to  specific  securities  or
mortgages.

Total equity decreased $7.0 million, or 12.8%, primarily due to the $6.6 million
net repurchase of shares during 1998. Earnings of $1.3 million less dividends of
$2.1 million decreased retained earnings by $0.8 million in 1998. The Company is
no longer subject to regulatory  limitations on stock repurchases and intends to
continue modest repurchases of stock.


<PAGE>


COMPARISON OF RESULTS OF OPERATIONS

COMPARISON OF YEARS ENDED DECEMBER 31, 1998 AND DECEMBER 31, 1997

The  Company's  results of operations  depend  primarily on the level of its net
interest income and non-interest income and the level of its operating expenses.
Net  interest  income  depends  upon the volume of  interest-earning  assets and
interest-bearing  liabilities  and the interest  rate earned or paid on them. In
addition, the Company receives fees from loan originations,  late payments, loan
servicing  and payments for service  related to  transaction  and other  deposit
accounts, and from dividends on its FHLB stock.

GENERAL.  Net income for the year ended December 31, 1998, was $1.3 million,  an
increase of $1.1  million  compared to the year ended  December  31,  1997.  The
increase  was  primarily  the result of a  decrease  in the  provision  for loan
losses,  an  increase  in  non-interest  income  due to a net  gain  on  sale of
branches,  and  increases  in service  fees  offset in part by a decrease in net
interest  income and an increase in provision for income taxes  primarily due to
the gain on sale.  The  provision  for the year ended  December 31, 1998,  was a
reversal  of  $363,000,  a decrease of $2.6  million  compared to the year ended
December 31, 1997,  which  reflected a provision of $2.3  million.  Net interest
income  decreased  $1.2 million from $11.1  million to $9.9  million,  or 11.2%,
primarily  as  a  result  of  a   combination   of  lower   volumes  of  average
interest-earning  assets partially  offset by lower volumes of  interest-bearing
liabilities. Non-interest income increased $2.7 million as a result of increased
deposit account service fees and net gain before taxes on sale of the Cincinnati
area deposits.  For the year ended December 31, 1998,  non-interest  income also
included  a  $307,000  gain from the sale of  securities.  Non-interest  expense
increased  $286,000,  from $9.5 million at December 31, 1997, to $9.8 million at
December 31, 1998,  primarily due to additional  expenses of $301,000 related to
exiting the Cincinnati  area.  Income taxes increased $2.7 million from $158,000
at December  31, 1997,  to $2.9  million at December  31,  1998,  as a result of
higher income and the tax effect of intangible asset disposition associated with
the Cincinnati area branch closing.

INTEREST  INCOME.  Total interest income decreased $3.2 million or 11.0% for the
year ended  December  31,  1998,  compared to the prior year.  This  decrease is
chiefly due to the lower volume of interest earning assets. This lower volume is
due  mostly  to  customer  refinancing  of  loans  during  the year due to lower
mortgage rates. Interest income from loans decreased $3.4 million as a result of
the  decreased  volume.  Interest  from  securities  and other  sources  rose by
$221,000 primarily due to additional volumes generated to fund the deposit sale.

INTEREST EXPENSE. Total interest expense decreased $1.9 million or 10.8% for the
year ended  December 31, 1998,  compared to the prior year. The decrease was due
primarily  to a  lower  average  volume  of  borrowings.  Interest  on  deposits
increased $217,000 or 1.8% for the year ended December 31, 1998, compared to the
prior year.  Interest on  borrowings  decreased  $2.2  million or 37.8% over the
prior year due primarily to lower volumes.

PROVISION  FOR LOAN  LOSSES.  The  provision  for  loan  losses  is a result  of
management's  periodic analysis of the adequacy of the allowance for loan losses
and any  specific  losses  applied  to that  allowance.  During  the year  ended
December 31, 1998, the provision for loan loss was $(363,000).  This is a change
of $2.6 million from a $2.3 million  provision  during the prior year.  In 1997,
management  identified  losses and increased  its provision for several  problem
loans  during  the fourth  quarter of 1997.  These  loans  were  primarily  of a
commercial nature.  Based on satisfactory  resolution of one of the problem loan
situations,  actual  problem  loan  activity,  net  charge-offs  of $359,000 and
continued  review,  management  estimated a $363,000  reduction in the loan loss
provision was reasonable.  Management  believes that the total allowance of $3.2
million  on total  assets of $328  million  and total  loans of $231  million at
December 31, 1998, is adequate  given the area economic  conditions and its loan
portfolio  composition.  At  December  31,  1998,  the  Company  was aware of no
regulatory directives or suggestions that the Company make additional provisions
for losses on loans.

The  Company  will  continue  to review its  allowance  for loan losses and make
further  allowances as economic and asset quality conditions  dictate.  Although
the Company maintains its allowance for loan losses at a level that it considers
to be adequate to provide for probable  losses,  there can be no assurance  that
future losses will not exceed  estimated  amounts or that additional  provisions
for loan  losses  will not be  required  in future  periods.  In  addition,  the
Company's  determination  as to the amount of the  allowance  for loan losses is
subject  to  review by the OTS and the  Federal  Deposit  Insurance  Corporation
("FDIC"),   which  can  order  the   establishment  of  additional  or  specific
allowances.

NON-INTEREST INCOME. Non-interest income increased from $992,000 in 1997 to $3.7
million in 1998.  This increase is due primarily to additional  deposit  account
service fees and net gain before taxes on sale of the Cincinnati  area branches.
Deposit  account  service fees  increased  $355,000 as  management  continues to
actively increase fee income resulting from deposit activity.

During 1998,  management determined the branch investment in the Cincinnati area
was not in line with the Company's  long-term  goals.  As a result,  the Company
sold the Cincinnati area deposits and closed or sold four branches. The net gain
on the sale of deposits and branches was $2.1 million before taxes.

NON-INTEREST  EXPENSE.  Total non-interest  expense increased 3.0% in 1998, from
$9.5 million in 1997 to $9.8  million.  The increase is primarily  the result of
additional personnel costs of approximately  $169,000 associated with closing of
the Cincinnati area branches.

INCOME TAX  EXPENSE.  Income tax  expense  was $2.9  million  for the year ended
December  31,  1998,  an increase of $2.7 million from the same period the prior
year. Income taxes increased  primarily as a result of increased earnings before
income taxes, and the tax effect of the intangible asset disposition  associated
with the  Cincinnati  area  branch  sale.  The  write-off  of the  $1.4  million
intangible asset  originally  associated with the Cincinnati area acquisition is
not deductible for tax purposes, and is a permanent tax difference for computing
the Company's  tax expense.  As a result,  the Company's  effective tax rate for
1998  was  68.9%  compared  to 46.3% in 1997.  In 1999,  it is  anticipated  the
Company's  effective tax rate will approach the U.S.  federal income tax rate of
34%.

COMPARISON OF YEARS ENDED DECEMBER 31, 1997 AND DECEMBER 31, 1996

GENERAL.  Net income for the year ended  December  31,  1997,  was  $183,000,  a
decrease of $879,000  compared to the year ended December 31, 1996. The decrease
was primarily  the result of an increase in the  provision for loan losses.  The
provision for the year ended December 31, 1997, was $2.3 million, an increase of
$1.9 million  compared to the year ended December 31, 1996,  which was $399,000.
Net interest  income  increased by $728,000 from $10.4 million to $11.1 million,
or 7.0%,  primarily  as a result of a  combination  of higher  rates on  average
interest-earning  assets  and  lower  rates  on  interest-bearing   liabilities.
Non-interest  income  increased  substantially  as the result of increased  fees
earned on savings and checking  accounts.  For the year ended December 31, 1996,
non-interest  income also included a $234,000 gain from the sale of  securities.
Non-interest expense increased $712,000, from $8.8 million at December 31, 1996,
to $9.5 million at December 31, 1997,  primarily due to an approximate  $610,000
in charges relating to the combination of the two previously separate Cincinnati
subsidiaries  into  Cornerstone.  The  increase  in  non-interest  expense  also
reflects a full year of costs of operating the Cincinnati offices.  Income taxes
decreased  by  $549,000  from  $707,000  at December  31,  1996,  to $158,000 at
December 31, 1997, primarily as a result of lower income.

INTEREST  INCOME.  Total interest income increased $4.9 million or 20.2% for the
year ended  December  31,  1997,  compared to the prior year.  This  increase is
chiefly due to the higher volume of interest earning assets.  This higher volume
is due mostly to a higher  volume of loans  receivable  which  reflects the full
year  addition  of the  Cincinnati  subsidiaries,  Mayflower  and  Seven  Hills.
Interest from investment securities and other sources rose by $511,000 primarily
due to the full year earnings on the increased average investment resulting from
the  acquisitions.  Interest income from the available for sale  mortgage-backed
securities  declined  $1.0  million due largely to the sale of $10.7  million of
mortgage backed securities during 1997.

INTEREST EXPENSE. Total interest expense increased $4.2 million or 30.1% for the
year ended  December 31, 1997,  compared to the prior year. The increase was due
primarily  to a higher  volume of both  deposits  and  borrowings.  Interest  on
deposits  increased  $3.0 million or 31.9% for the year ended December 31, 1997,
compared to the prior year.  Interest on  borrowings  increased  $1.2 million or
26.4% over the prior year.

PROVISION  FOR LOAN  LOSSES.  The  provision  for  loan  losses  is a result  of
management's  periodic analysis of the adequacy of the allowance for loan losses
and any  specific  losses  applied to that  allowance.  There was a $2.3 million
additional  provision for loan losses  during the year ended  December 31, 1997.
This is an increase of $1.9 million from a $399,000  provision  during the prior
year.  Management  identified  losses and  increased  its  provision for several
problem loans during the fourth quarter of 1997. These loans were primarily of a
commercial nature.  Management believes that the total allowance of $3.9 million
is  adequate  given  the  area  economic   conditions  and  its  loan  portfolio
composition.  At December  31,  1997,  the  Company  was aware of no  regulatory
directives or suggestions that the Company make additional provisions for losses
on loans.

NON-INTEREST  INCOME.  Non-interest  income  increased  from $550,000 in 1996 to
$992,000 in 1997.  This  increase is due primarily to an increase of $494,000 in
fees and other  charges.  Management  has  actively  sought to increase  the fee
income resulting from deposit activity.

NON-INTEREST EXPENSE.  Total non-interest expense increased from $8.8 million in
1996 to $9.5 million in 1997, an increase of 8.1%. The increase is the result of
a combination of increased  spending due to the name change to Cornerstone  Bank
and combination of the subsidiary  institutions  and increased  spending for the
full year operation of the acquired institutions.

INCOME TAX EXPENSE.  Income tax expense was $158,000 for the year ended December
31, 1997, a decrease of $549,000, or 77.7%, from the same period the prior year.
Income taxes decreased primarily as a result of decreased earnings before income
taxes.


<PAGE>


AVERAGE  BALANCES,  INTEREST RATES AND YIELDS.  The following table presents for
the periods  indicated the total dollar  amount of interest  income from average
interest-earning  assets  and the  resultant  yields,  as  well as the  interest
expense on average interest-bearing  liabilities,  expressed both in dollars and
rates. No tax equivalent adjustments were made. All average balances are monthly
average  balances.  Non-accruing  loans have been included in the table as loans
carrying a zero yield.  The average  balance of  mortgage-backed  securities and
securities  available for sale includes  unrealized gains and losses while yield
is based on amortized cost.

<TABLE>
<CAPTION>

                                                               Year Ended December 31,
                               --------------------------------------------------------------------------------------------------
                                             1998                              1997                            1996
                               --------------------------------  -------------------------------   ------------------------------ 
                                 Average     Interest              Average     Interest               Average    Interest 
                               Outstanding   Earned/    Yield/   Outstanding   Earned/    Yield/    Outstanding  Earned    Yield/
                                 Balance     Paid       Rate      Balance      Paid       Rate       Balance     Paid      Rate
                               -----------  -------     ------   -----------   --------   ------    -----------  --------  -----
                                                                   (Dollars in Thousands)
<S>                             <C>          <C>        <C>      <C>            <C>       <C>       <C>          <C>       <C>

Interest-earning assets:
 Loans receivable               $252,232      $20,411     8.09%     $298,111      $23,815   7.99%     $235,936     $18,437   7.81%
 Mortgage-backed securities       27,626        1,608     5.85        28,994        1,843   6.39        43,243       2,854   6.64
 Securities                       14,781          980     6.65        33,083        2,143   6.40        27,190       2,069   7.45
 Interest-bearing deposits        37,399        2,379     6.36         9,585          797   8.32         8,293         506   6.10
 FHLB stock                        6,649          478     7.19         6,102          441   7.23         3,914         294   7.51
                                 -------     --------              ---------     --------              -------    --------      
  Total interest-earning assets $338,687      $25,856     7.63      $375,875      $29,039   7.73      $318,576     $24,160   7.58
                                ========      =======               ========      =======             ========     =======

 Non-earning assets               23,508                              20,124                             3,242
                                --------                            --------                           -------
   Total assets                 $362,195                            $395,999                          $321,818    
                               =========                            =========                         ======== 

Interest-bearing liabilities:  
 Time deposits                  $164,302      $ 9,641     5.87      $175,163      $10,447   5.96      $144,140     $ 8,188   5.68
 Demand and NOW deposits          12,990          180     1.39        11,998          129   1.08        13,640         146   1.07
 Savings deposits                 65,709        2,614     3.98        53,305        1,642   3.08        29,344         926   3.16
 Borrowings                       62,802        3,557     5.66        97,414        5,716   5.87        79,665       4,523   5.68
                               ---------     --------               --------      -------             --------      -----
  Total interest-bearing
    liabilities                 $305,803      $15,992     5.23      $337,880      $17,934   5.31      $266,789     $13,783   5.17
                               =========      -------               ========      -------             ========     -------   

 Non-earning liabilities           2,775                               4,908                             1,929
                                ---------                           ---------                         --------
  Total liabilities             $308,578                            $342,788                          $268,718

 Equity                           53,617                            $ 53,211                          $ 53,100

   Total liabilities/equity     $362,195                            $395,999                          $321,818
                                =========                           =========                         ========

Net interest income                           $ 9,864                             $11,105                          $10,377 
                                             =========                            ========                         =======

Net interest rate spread                                  2.40%                             2.42%                            2.42%
                                                          ====                              =====                            =====
Net earning assets              $ 32,884                            $ 37,995                          $ 51,787
                                =========                           =========                         ========   

Net yield on average interest-
  earning assets                                          2.91%                              2.95%                           3.26%
                                                          =====                              =====                           =====

Average interest-earning
  average interest-bearing 
  liabilities                                    1.11x                               1.11x                            1.19x
                                                 =====                               =====                            =====


</TABLE>


<PAGE>



RATE/VOLUME  ANALYSIS.  The  following  schedule  presents the dollar  amount of
changes  in  interest  income  and  interest  expense  for major  components  of
interest-earning  assets  and  interest-bearing  liabilities.  It  distinguishes
between  the  increase  or  decrease  related to changes in average  outstanding
balances and that due to the volatility of interest rates.  For each category of
interest-earning  assets  and  interest-bearing   liabilities,   information  is
provided  on changes  attributable  to (i) changes in volume  (i.e.,  changes in
volume  multiplied by new rate) and (ii) changes in rate (i.e.,  changes in rate
multiplied by old volume).  For purposes of this table,  changes attributable to
both  rate  and  volume  which  cannot  be   segregated   have  been   allocated
proportionately to the change due to volume and the change due to rate.

<TABLE>
<CAPTION>

                                        Year Ended December 31,                        Year Ended December 31,
                                     --------------------------------         -----------------------------------------  
                                                1997 vs. 1998                                  1996 vs. 1997
                                     --------------------------------         -----------------------------------------
                                          Increase                                  Increase
                                         (Decrease)                                (Decrease)       
                                           Due To             Total                  Due to               Total
                                    -----------------        Increase            -----------------       Increase
                                     Volume     Rate        (Decrease)           Volume       Rate      (Decrease)
                                     ------     -----       ----------           -------     ------     ----------    
                                                               (Dollars in Thousands)

<S>                                 <C>          <C>        <C>                 <C>          <C>        <C>

Interest-earning assets:            
 Loans receivable                    $(3,709)       $ 305      $(3,404)           $4,957       $ 421     $ 5,378
 Mortgage-backed securities              (84)        (151)        (235)             (909)       (102)     (1,011)
 Securities                           (1,237)          74       (1,163)              379        (305)         74
 Other                                 1,875         (256)       1,619               287         151         438
                                     -------         -----     -------          --------      ------     -------

  Total interest-earning assets      $(3,155)       $ (28)     $(3,183)           $4,714       $ 165      $4,879
                                     =======        =====      =======           =======      ======     =======  

Interest-bearing liabilities:
 Time deposits                       $  (643)       $ (163)     $ (806)           $2,412       $(153)     $2,259
 Demand and NOW deposits                  12            39          51                (9)         (8)        (17)
 Savings deposits                        431           541         972               772         (56)        716
 Borrowings                           (1,952)         (207)     (2,159)            1,329        (136)      1,193
                                     -------        -------     -------          -------      ------     ------- 

  Total interest-bearing liabilities $(2,152)       $  210     $(1,942)           $4,504       $(353)     $4,151
                                     =======         =====     =======           =======      ======     ======= 
 
Net interest income                                            $(1,241)                                   $  728
                                                               =======                                    ======

</TABLE>

<PAGE>


ASSET/LIABILITY MANAGEMENT AND MARKET RISK

The  Company's  primary  market risk  exposure  is interest  rate risk and, to a
lesser extent, liquidity risk. Interest rate risk is the risk that the Company's
financial  condition  will be  adversely  affected  due to movements in interest
rates. The income of financial institutions is primarily derived from the excess
of  interest  earned  on  interest-earning  assets  over  the  interest  paid on
interest-bearing  liabilities.  Accordingly, the Company places great importance
on monitoring and controlling  interest-rate  risk. The measurement and analysis
of the exposure of the Company's primary operating subsidiary, Cornerstone Bank,
to changes in the interest rate  environment are referred to as  asset/liability
management.  One method used to analyze the Company's  sensitivity to changes in
interest rates is the "net portfolio value" ("NPV")  methodology used by the OTS
as part of its capital regulations.

NPV is generally  considered to be the present value of the  difference  between
expected incoming cash flows on  interest-earning  and other assets and expected
outgoing cash flows on interest-bearing  and other liabilities.  The application
attempts  to  quantify  interest  rate risk as the change in the NPV which would
result from a theoretical  200 basis point (1 basis point equals .01%) change in
market interest rates.  Both a 200 basis point increase in market interest rates
and a 200 basis point decrease in market interest rates are considered.

Presented on page 19 is an analysis of  Cornerstone's  interest  rate risk as of
December  31, 1998,  and  December  31, 1997,  as measured by changes in NPV for
instantaneous  and  sustained  parallel  shifts  of 100  basis  points in market
interest  rates.  The tables also contain the policy  limits set by the Board of
Directors as the maximum change in NPV the Board of Directors deems advisable in
the  event  of  various  changes  in  interest  rates.  Such  limits  have  been
established  with  consideration  to the impact on the NPV  capital  position of
various rate changes and the institution's strong capital position.

As illustrated in the tables,  the institution's NPV is more sensitive to rising
rates than declining  rates.  From an overall  perspective,  such  difference in
sensitivity occurs principally  because, as rates rise,  borrowers do not prepay
fixed-rate loans as quickly as they do when interest rates are declining.  Thus,
in a  rising  interest  rate  environment,  because  Cornerstone  has  primarily
fixed-rate loans in its loan portfolio, the amount of interest Cornerstone would
receive  on its loans  would  increase  relatively  slowly  as loans are  slowly
prepaid  and new  loans  at  higher  rates  are  made.  Moreover,  the  interest
Cornerstone   would  pay  on  its  deposits  would  increase   rapidly   because
Cornerstone's deposits generally have shorter periods to repricing.  Assumptions
used in calculating the amounts in these tables correspond with OTS assumptions.

<TABLE>
<CAPTION>

                              December 31, 1998         December 31, 1997
                             ------------------         ------------------   
  Change in     
Interest Rate   Board limit    $ change   % change    $ change    % change
(Basis Points)  % change        in NPV     in NPV      in NPV      in NPV
--------------  -----------    --------   ---------   --------   ---------               
<S>             <C>            <C>         <C>        <C>        <C>
 
                       (Dollars in thousands)

    +300          (60)         (13,580)      (29)      (15,912)     (31)
    +200          (40)          (8,505)      (18)       (9,984)     (19)
    +100          (20)          (3,731)       (8)       (4,537)      (9)
     ---          ---              ---       ---           ---      ---
    -100          (20)           1,551         3         3,113        6
    -200          (40)           2,519         5         4,633        9
     300          (60)           3,951         9         6,248       12


</TABLE>

As of December 31, 1998,  the  percentage  change in NPV resulting  from certain
changes in  interest  rates were within the policy  limits of the  institution's
Board of  Directors.  It should be noted that the above  table only  pertains to
Cornerstone  Bank  and  does  not  apply to the  holding  company.  The  holding
company's  assets are all of a short term or short term to repricing  nature and
therefore are not subject to significant interest rate risk.

<PAGE>

As with any method of measuring  interest rate risk,  certain  shortcomings  are
inherent  in  the  NPV  approach.  For  example,  although  certain  assets  and
liabilities may have similar maturities or periods of repricing,  they may react
in different  degrees to changes in market  interest  rates.  Also, the interest
rates on certain  types of assets and  liabilities  may  fluctuate in advance of
changes in market  interest  rates,  while interest rates on other types may lag
behind  changes in market rates.  Further,  in the event of a change in interest
rates, expected rates of prepayment on loans and mortgage-backed  securities and
early  withdrawal  levels from  certificates  of deposit  would  likely  deviate
significantly from those assumed in making risk calculations.

In the event that interest rates rise from the recent  historically  low levels,
Cornerstone's  net interest income could be expected to be negatively  affected.
Moreover,  rising interest rates could negatively affect Cornerstone's  earnings
and thereby the Company's earnings due to diminished loan demand. As part of its
interest   rate  risk   strategy,   Cornerstone   has   attempted   to   utilize
adjustable-rate and short-term-duration loans and investments.

Cornerstone  fully  intends to limit the  addition of  fixed-rate  long-duration
loans and securities to its portfolio. In addition to this restructuring, it has
also begun to offer  consumer  products that reprice on a monthly  basis.  It is
expected that as the size of these portfolio  segments grows,  the interest rate
risk will be lessened, though not eliminated.


LIQUIDITY AND CAPITAL RESOURCES


Western Ohio Financial  Corporation's  liquidity,  primarily represented by cash
equivalents,  is a result of its operating,  investing and financing activities.
These  activities  are  summarized  below for the years ended December 31, 1998,
1997 and 1996.

<TABLE>
<CAPTION>


                                                 Year Ended December 31,
                                             ------------------------------ 
                                                1998       1997      1996
                                             ---------  --------- --------- 
                                                 (Dollars in Thousands)
<S>                                          <C>        <C>       <C>   

Net income                                   $  1,295   $    183  $  1,062
Adjustments to reconcile net income to
  net cash from operating activities           (2,173)       668      (324)
                                             --------   --------  --------
Net cash from operating activities               (878)       851       738
Net cash from investment activities            23,025     35,999   (82,460)
Net cash from financing activities            (39,532)   (21,222)   79,728
                                             --------   --------  --------
Net change in cash and cash equivalents       (17,385)    15,628    (1,994)
Cash and cash equivalents at
  beginning of period                          31,239     15,611    17,605
                                             --------   --------  --------
Cash and cash equivalents at
  end of period                              $ 13,854   $ 31,239  $ 15,611
                                             ========   ========  ========

</TABLE>


At December 31, 1998, the Company had $1.1 million in outstanding commitments to
sell loans or securities.

The OTS requires  minimum levels of liquid  assets.  OTS  regulations  presently
require  Cornerstone  to  maintain  an average  daily  balance of liquid  assets
(United States Treasury and federal agency  obligations,  of any maturity) equal
to at least  4% of the sum of its  average  daily  balance  of net  withdrawable
deposit accounts and borrowings  payable in one year or less. Such  requirements
may be  changed  from  time  to time by the  OTS to  reflect  changing  economic
conditions.

Such  investments  are intended to provide a source of  relatively  liquid funds
upon which Cornerstone may rely, if necessary,  to fund deposit  withdrawals and
other short-term funding needs.  Cornerstone's  average regulatory  liquidity at
December 31, 1998, was 36.3%.

<PAGE>

The Company's  primary  sources of funds  consist of deposits and  repayments of
loans and interest earned on securities. The Company maintains a higher ratio of
loans to deposits in comparison with other similarly sized savings institutions.
Historically,  this has not had a material effect on the Company's  liquidity as
it has utilized other potential  sources of funds including  borrowings from the
FHLB  of  Cincinnati  to  maintain  liquidity  and to meet  operating  expenses.
Management  believes  that loan  repayments  and other  sources of funds will be
adequate to meet the Company's foreseeable liquidity needs.

The Company's  primary financing source during 1998 was borrowings from the FHLB
of $76.2 million.  Also a major financing source was the net increase in savings
deposits  of $30.4  million.  The Company  paid $2.1  million in  dividends  and
acquired  treasury  stock for $6.6 million in 1998.  Liquidity  management  is a
daily and  long-term  responsibility  of  management.  The  Company  adjusts its
investments in liquid assets based upon  assessment of (i) expected loan demand,
(ii) expected deposit flows, (iii) yields available on interest-bearing deposits
and  (iv) the  objectives  of its  asset/liability  management  program.  Excess
liquidity is invested generally in interest-bearing overnight deposits and other
short-term government and agency obligations. If the Company requires additional
funds  beyond its  internal  ability to generate,  it has  additional  borrowing
capacity with the FHLB of Cincinnati.

The Company  anticipates  that it will have  sufficient  funds available to meet
current loan  commitments.  At December 31,  1998,  the Company had  outstanding
commitments to extend credit that amounted to $14.4 million.

Under The Financial  Institutions  Reform,  Recovery and Enforcement Act of 1989
("FIRREA"),  the capital  requirements  applicable to all savings  institutions,
including Cornerstone,  were substantially increased. However, Cornerstone is in
compliance with all applicable capital requirements and expects to remain so.

OTS regulations  require that institutions  maintain  "tangible  capital" of not
less than 1.5% of the institution's  adjusted total assets.  Tangible capital is
defined as "core capital" less any intangible assets.  Core capital is comprised
of  common  shareholders'  equity  (including  retained  earnings).  OTS  prompt
corrective  action  regulations  require core capital to be  maintained at 3% of
total institution assets. The following table indicates the requirement for core
capital is 4% because  that is the level that the OTS prompt  corrective  action
regulations require to be considered adequately capitalized.

OTS regulations require the institution to maintain  "risk-based  capital" in an
amount not less than 8% of risk-weighted  assets.  Risk-based capital is defined
as core capital plus certain additional items.  Cornerstone's adjustment to core
capital  included  the  portion  of the loan and lease loss  allowance  over the
amount required for loans classified as loss. This adjustment is $1.8 million as
of December 31, 1998.

The following table summarizes Cornerstone's regulatory capital requirements and
actual capital at December 31, 1998.

<TABLE>
<CAPTION>

                                                                          Excess of Actual
                                                                        Capital Over Current
                     Actual Capital         Current Requirement              Requirement
                 --------------------      --- -------------------     -----------------------
                  AMOUNT      PERCENT       AMOUNT         PERCENT       AMOUNT       PERCENT
                 --------     -------      ---------      --------      --------     ---------
                                        (Dollars in thousands)

<S>               <C>        <C>           <C>            <C>           <C>           <C>

Tangible capital   $41,078    12.56%         $ 4,906        1.50%          $36,172       11.06%
Core capital        41,078    12.56           13,082        4.00            27,996        8.56
Risk-Based capital  42,847    24.16           14,188        8.00            28,659       16.16

</TABLE>



<PAGE>



IMPACT OF NEW ACCOUNTING STANDARDS

Statement of Financial  Accounting  Standards ("SFAS") No. 133,  "Accounting for
Derivative  Instruments and Hedging  Activities,"  requires  companies to record
derivatives  on the  balance  sheet as assets or  liabilities,  measured at fair
value. Gains or losses resulting from changes in the values of those derivatives
would be accounted  for  depending on the use of the  derivative  and whether it
qualifies for hedge  accounting.  The key criterion for hedge accounting is that
the  hedging  relationship  must be highly  effective  in  achieving  offsetting
changes  in fair  value or cash  flows.  SFAS 133 does not  allow  hedging  of a
security which is classified as held to maturity,  accordingly, upon adoption of
SFAS 133,  companies  may  reclassify  any  security  from held to  maturity  to
available  for sale if they wish to be able to hedge the security in the future.
SFAS 133 is effective for fiscal years beginning after June 15, 1999, with early
adoption  encouraged  for any fiscal  quarter  beginning July 1, 1998, or later,
with no retroactive application. Management does not expect the adoption of SFAS
133 to have a significant impact on the Company's financial statements.

SFAS No. 134,  "Accounting  for  Mortgage-backed  Securities  Retained after the
Securitization   of  Mortgage  Loans  Held  for  Sale  by  a  Mortgage   Banking
Enterprise,"  changes the way companies involved in mortgage banking account for
certain securities and other interests they retain after  securitizing  mortgage
loans  that were held for sale.  SFAS 134 allows  any  retained  mortgage-backed
securities  after  a  securitization  of  mortgage  loans  held  for  sale to be
classified  based on holding intent in accordance with SFAS 115, except in cases
where the  retained  mortgage-backed  security is committed to be sold before or
during  the  securitization  process  in  which  case it must be  classified  as
trading. Previously, all retained mortgage-backed securities were required to be
classified as trading. SFAS 134 will be effective on January 1, 1999, and is not
expected to have a significant impact on the Company's financial statements.



IMPACT OF INFLATION AND CHANGING PRICES


The  consolidated  financial  statements and related data presented  herein have
been  prepared  according  to generally  accepted  accounting  principles  which
require the measurement of financial  position and operating results in terms of
historical dollars without  considering changes in the relative purchasing power
of  money  over  time  due  to  inflation.   An  exception  to  historical  cost
presentation  is the valuation of  securities  available for sale under FASB No.
115. The primary  assets and  liabilities of the Company are monetary in nature.
As a result,  interest  rates have a more  significant  impact on the  Company's
performance  than the effects of general levels of inflation.  Interest rates do
not  necessarily  move in the same direction or magnitude as the prices of goods
and services.



<PAGE>




YEAR 2000 ISSUE

The Company's lending and deposit  activities are almost entirely dependent upon
computer systems which process and record transactions, although the Company can
effectively  operate with manual  systems for brief periods when its  electronic
systems malfunction or cannot be accessed.  The Company utilizes the services of
a nationally  recognized data processing service bureau that specializes in data
processing  for  financial  institutions.  In  addition  to its basic  operating
activities,  the  Company's  facilities  and  infrastructure,  such as  security
systems and communications  equipment,  are dependent,  to varying degrees, upon
computer systems.

The Company is aware of the potential Year 2000 related problems that may affect
the  computers  which  control  or  operate  the  Company's  operating  systems,
facilities  and  infrastructure.  In  1997,  the  Company  began  a  process  of
identifying  any Year  2000  related  problems  that may be  experienced  by its
computer-operated or  computer-dependent  systems. The Company has contacted the
companies   that  supply  or  service   the   Company's   computer-operated   or
computer-dependent  systems  to obtain  confirmation  that each  system  that is
material  to the  operations  of the  Company  is  either  currently  Year  2000
compliant or is expected to be Year 2000 compliant. With respect to systems that
cannot presently be confirmed as Year 2000 compliant,  the Company will continue
to work with the appropriate  supplier or servicer to ensure insofar as possible
that all such  systems  will be  rendered  compliant  in a timely  manner,  with
minimal expense or disruption of the Company's operations. All of the identified
computer  systems  affected  by  the  Year  2000  issue  are  currently  in  the
renovation,  validation or implementation  phase of the process of becoming Year
2000 compliant.

As a contingency plan, the Company has determined that if such service providers
were to have their systems  fail,  the Company would  implement  manual  systems
until such systems could be re-established. The Company does not anticipate that
such  short-term  manual  systems  would have a material  adverse  effect on the
Company's operations. The expense of any change in suppliers or servicers is not
expected to be material to the  Company.  The Company has  examined its computer
hardware and software and determined it will cost approximately $128,000 to make
such systems Year 2000 compliant.  Of that amount, the Company has already spent
$47,000. At this time,  however,  any additional expense that may be incurred by
the Company in connection with Year 2000 issues cannot be determined.

In addition to the  possible  expense  related to its own  systems,  the Company
could  incur  losses if loan  payments  are  delayed  due to Year 2000  problems
affecting  any of the Company's  significant  borrowers or impairing the payroll
systems of large  employers in the Company's  primary  market area.  Because the
Company's  loan  portfolio  is highly  diversified  with  regard  to  individual
borrowers and types of businesses  and the Company's  primary market area is not
significantly dependent on one employer or industry, the Company does not expect
any  significant  or prolonged  Year 2000 related  difficulties  will affect net
earnings or cash flow.  Although  the company does not  anticipate  any material
adverse  effects  on its  operations  as a result  of the Year 2000  issue,  the
Company  cannot  guarantee  that Year 2000 issues will not affect its operations
negatively.


<PAGE>

                        REPORT OF INDEPENDENT AUDITORS



Board of Directors and Shareholders
Western Ohio Financial Corporation

We have  audited the  accompanying  consolidated  balance  sheet of Western Ohio
Financial  Corporation  as of December  31, 1998,  and the related  consolidated
statements of income,  comprehensive income, shareholders' equity and cash flows
for the year then ended.  These financial  statements are the  responsibility of
the  Corporation's  management.  Our  responsibility is to express an opinion on
these financial  statements based on our audits.  The 1997 and 1996 consolidated
financial statements of Western Ohio Financial Corporation were audited by other
auditors whose report dated January 23, 1998,  expressed an unqualified  opinion
on those statements.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable  assurance about whether the  consolidated  financial  statements are
free of material  misstatement.  An audit includes  examining,  on a test basis,
evidence  supporting the amounts and disclosures in the  consolidated  financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
consolidated  financial  statement  presentation.  We  believe  that our  audits
provide a reasonable basis for our opinion.

In our opinion,  the 1998 consolidated  financial  statements  referred to above
present fairly, in all material respects, the financial position of Western Ohio
Financial Corporation as of December 31, 1998, and the results of its operations
and its cash  flows  for the year  then  ended,  in  conformity  with  generally
accepted accounting principles.



                                       /s/ Crowe, Chizek and Company LLP

February 12, 1999
Columbus, Ohio




<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION


<TABLE>
<CAPTION>
                      WESTERN OHIO FINANCIAL CORPORATION
                         CONSOLIDATED BALANCE SHEETS
                          December 31, 1998 and 1997
                   (Dollars in thousands, except share data)



<S>                                                           <C>         <C> 
                                                              1998        1997
                                                             -----      -----
ASSETS
   Cash and cash equivalents                               $  3,987   $  4,006
   Overnight deposits in other financial institutions         4,550     22,350
   Interest-bearing deposits in other financial institutions  5,317      4,883
                                                            -------   --------
      Total cash and cash equivalents                        13,854     31,239
   Securities available for sale                             15,402     22,455
   Mortgage-backed securities available for sale             50,044     22,433
   Federal Home Loan Bank stock                               6,948      6,470
   Loans, net                                               230,914    277,731
   Loans held for sale                                        3,898          -
   Premises and equipment, net                                3,241      3,924
   Accrued interest receivable                                1,897      2,360
   Goodwill                                                       -      3,581
   Other assets                                               1,530      1,795
                                                           --------   --------

         Total assets                                      $327,728   $371,988
                                                           ========   ========

LIABILITIES
   Deposits                                                $192,966   $246,909
   Borrowed funds                                            85,252     68,339
   Advance payments from borrowers for taxes and insurance      881        893
   Other liabilities                                          1,035      1,247
                                                           --------   --------
      Total liabilities                                     280,134    317,388
                                                           --------   --------
SHAREHOLDERS' EQUITY
   Common stock; $.01 par value; 7,250,000 shares authorized;
     2,645,000 shares issued;                                    26         26
   Additional paid-in capital                                40,452     40,458
   Retained earnings                                         20,351     21,198
   Unearned employee stock ownership plan shares             (1,309)    (1,547)
   Unearned management recognition plan shares               (1,092)      (396)
   Treasury stock; 476,317 and 261,565 shares, at cost      (10,714)    (5,448)
   Accumulated other comprehensive income                      (120)       309
                                                           --------   --------
      Total shareholders' equity                             47,594     54,600
                                                           --------   --------

         Total liabilities and shareholders' equity        $327,728   $371,988
                                                           ========   ========
</TABLE>

                See accomanying notes to financial statements.


  <PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION


                      WESTERN OHIO FINANCIAL CORPORATION
                      CONSOLIDATED STATEMENTS OF INCOME
                Years  ended  December  31,  1998,  1997,  and 1996
                (Dollars in thousands, except per share data)

<TABLE>
<CAPTION>


                                                  1998       1997      1996
                                                --------   --------  --------
<S>                                              <C>        <C>        <C>   

Interest and dividend income
   Loans, including fees                         $20,411    $23,815   $18,437
   Mortgage-backed securities                      1,608      1,843     2,854
   Other securities                                  980      2,143     2,069
   Interest-bearing deposits and overnight funds   2,379        797       506
   Other interest and dividend income                478        441       294
                                                 -------    -------   -------
      Total interest income                       25,856     29,039    24,160
                                                 -------    -------   -------

Interest expense
   Deposits                                       12,435     12,218     9,260
   Borrowed funds                                  3,557      5,716     4,523
                                                 -------    -------   -------
      Total interest expense                      15,992     17,934    13,783
                                                 -------    -------   -------
Net interest income                                9,864     11,105    10,377

Provision for loan losses                           (363)     2,285       399
                                                 -------    -------   -------

Net interest income after provision
   for loan losses                                10,227      8,820     9,978
                                                 -------     ------   -------

Noninterest income
   Service fees and other charges                  1,005        650       156
   Net gain (loss) on sale of securities             307         (5)      234
   Net gain on sale of portfolio loans                 -        228        83
   Net gain on sale of loans held for sale           345          -         -
   Net gain (loss) on sale or disposal of premises
     and equipment                                   (82)        88        23
   Net gain on sale of branches                    2,054          -         -
   Other income                                       60         31        54
                                                  ------    -------   -------
      Total noninterest income                     3,689        992       550
                                                  ------    -------   -------

Noninterest expense
   Salaries and employee benefits                  4,494      4,410     3,731
   Occupancy and equipment                           965        950       773
   Deposit insurance premiums                        148        128     1,465
   State franchise taxes                             748        732       898
   Professional fees                                 703        405       360
   Advertising                                       436        354       265
   Amortization of goodwill                          295        425       246
   Data processing services                          455        643       283
   Other expenses                                  1,513      1,424       738
                                                  ------     ------   -------
      Total noninterest expense                    9,757      9,471     8,759
                                                  ------     ------   -------
Income before income taxes                         4,159        341     1,769

Provision for income taxes                         2,864        158       707
                                                   -----     ------   -------

Net income                                        $1,295     $  183   $ 1,062
                                                  ======     ======   =======

Earnings per share - Basic                        $  .60     $  .08   $   .47
                                                  ======     ======   =======
Earnings per share - Diluted                      $  .58     $  .08   $   .46
                                                  ======     ======   =======
</TABLE>

               See notes to accompanying financial statements.

    


<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION


                      WESTERN OHIO FINANCIAL CORPORATION
               CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                Years ended December 31, 1998, 1997, and 1996
                            (Dollars in thousands)


<TABLE>
<CAPTION>

                                                    1998     1997    1996
                                                   ------   ------  ------
<S>                                               <C>       <C>     <C>    

Net income                                         $1,295   $ 183   $1,062

Other comprehensive income, net of tax
   Unrealized gain (loss) on available
     for sale securities arising during the period   (226)    548     (719)
   Reclassification adjustment for amounts realize
     on securities sales included in net income      (203)      3     (154)
                                                    -----   -----   ------
     Total other comprehensive income                (429)    551     (873)
                                                   ------   -----   ------
Comprehensive income                               $  866   $ 734   $  189
                                                   ======   =====   ======

</TABLE>
 

               See notes to accompanying financial statements.

   

<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION


                      WESTERN OHIO FINANCIAL CORPORATION
               CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                Years  Ended  December  31,  1998,  1997,  and 1996
                (Dollars in thousands, except per share data)


<TABLE>
<CAPTION>

                                                                    Unearned            Accumulated
                                                                   Additional            Employee                Other
                                                            Common  Paid-In   Retained    Benefit   Treasury Comprehensive
                                                            Stock  Capital    Earnings  Plan Shares  Stock     INCOME      TOTAL
                                                            -----  ---------- --------  ----------- -------- ------------- -------
<S>                                                         <C>    <C>        <C>       <C>          <C>        <C>         <C>

Balance, January 1, 1996                                    $ 26   $41,048    $24,447   $(3,034)    $ (3,450)   $ 631      $59,668
  Net income                                                 ---       ---      1,062       ---          ---      ---        1,062
  Cash dividends  - $1.00 per share                          ---       ---     (2,275)      ---          ---      ---       (2,275)
  Purchase of treasury shares                                ---       ---        ---       ---       (4,187)     ---       (4,187)
  Commitment to release employee stock ownership plan shares ---        86        ---       238          ---      ---          324
  Shares earned under management recognition plan, including
    related tax benefit realized on vesting of plan shares   ---        31        ---       247          ---      ---          278
  Stock options exercised, including tax benefit             ---        (7)       ---       ---           58      ---           51
  Change in fair value of securities available for sale      ---       ---        ---       ---          ---     (873)        (873)
                                                            ----   -------    -------   -------     --------    -----      -------
                                                           
Balance, December 31, 1996                                    26    41,158     23,234    (2,549)      (7,579)    (242)      54,048

  Net income                                                 ---       ---        183       ---          ---      ---          183
  Cash dividends  - $1.00 per share                          ---       ---     (2,219)      ---          ---      ---       (2,219)
  Purchase of treasury shares                                ---       ---        ---       ---         (370)     ---         (370)
  Commitment to release employee stock ownership plan shares ---       141        ---       238          ---      ---          379
  Shares awarded under management recognition plan           ---        19        ---       (76)          57      ---          ---
  Shares earned under management recognition plan, including
    tax benefit realized on vesting of plan shares           ---      (279)       ---       444          ---      ---          165
  Stock options exercised, including tax benefit             ---      (581)       ---       ---        2,444      ---        1,863
  Change in fair value of securities available for sale      ---       ---        ---       ---          ---      551          551
                                                            ----   -------    -------   -------     --------    -----      -------

Balance, December 31, 1997                                    26    40,458     21,198    (1,943)      (5,448)     309       54,600

  Net income                                                 ---       ---      1,295       ---          ---      ---        1,295
  Cash dividends  - $1.00 per share                          ---       ---     (2,142)      ---          ---      ---       (2,142)
  Purchase of treasury shares                                ---       ---        ---       ---       (6,611)     ---       (6,611)
  Commitment to release employee stock ownership plan shares ---       120        ---       238          ---      ---          358
  Reclassification of management recognition plan shares     ---       ---        ---      (868)         868      ---          ---
  Shares earned under management recognition plan, including
    tax benefit realized on vesting of plan shares           ---       ---        ---       172          ---      ---          172
  Stock options exercised, including tax benefit             ---      (126)       ---       ---          477      ---          351 
  Change in fair value of securities available for sale      ---       ---        ---       ---          ---     (429)        (429)
                                                            ----   -------    -------   -------     --------    -----      -------

Balance, December 31, 1998                                  $ 26   $40,452    $20,351   $(2,401)    $(10,714)   $(120)     $47,594
                                                            ====   =======    =======   =======     ========    =====      ======= 

</TABLE>

 
               See notes to accompanying financial statements.



<PAGE>
<TABLE>
<CAPTION>


                      WESTERN OHIO FINANCIAL CORPORATION


                      WESTERN OHIO FINANCIAL CORPORATION
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                Years Ended December 31, 1998, 1997, and 1996
                            (Dollars in thousands)



                                                    1998        1997     1996
                                                    ----        ----     ----
<S>                                               <C>       <C>        <C>   

Cash flows from operating activities
   Net income                                    $  1,295    $   183  $  1,062
   Adjustments to reconcile net income to
     net cash from operating activities
      Compensation expense on ESOP shares             358        379       324
      Compensation expense on MRP shares,
        net of tax benefit                            172        165       278
      Depreciation and amortization                   711        678       491
      Federal Home Loan Bank stock dividends         (478)      (441)     (294)
      Deferred loan origination fees                  (16)      (119)     (345)
      Amortization of premiums, accretion of
        discounts, net                                 78       (239)      (58)
      Deferred income taxes                           (71)      (177)       21
      Provision for loan losses                      (363)     2,285       399
      Net gain on sale of branches                 (2,054)       ---       ---
      Net (gain) loss on sale of securities          (307)         5      (234)
      Net gain on sale of portfolio loans             ---       (228)      (83)
      Net (gain) loss on sale or disposal of
        premises and equipment                         82        (88)      (23)
      Net loss on sale of real estate owned            32        ---       ---
      Changes in:
         Loans held for sale                       (1,131)       ---       ---
         Other asset and other liabilities            (83)      (780)      429
         Accrued interest receivable                  463       (190)     (999)
         Taxes payable                                434       (581)     (230)
                                                 --------    -------  --------
            Net cash from operating activities       (878)       852       738
                                                 --------    -------  --------

Cash flows from investing activities
  Securities available for sale:
      Purchases                                   (10,000)    (2,001)  (23,000)
      Proceeds from maturities                      1,700     15,900     2,321
      Proceeds from sales                          15,193        ---        51
  Mortgage-backed securities available for sale:
      Purchases                                   (40,179)       ---       ---
      Proceeds from principal payments              5,188      3,908     7,567
      Proceeds from sales                           7,119     10,684    21,770
   Purchases of Federal Home Loan Bank stock          ---       (167)   (3,141)
   Purchases of loans                                 ---     (3,710)  (45,236)
   Proceeds from sale of portfolio loans              ---     15,751    17,783
   Net (increase) decrease in loans                44,406     (4,047)  (45,465)
   Premises and equipment expenditures               (397)      (483)     (699)
   Proceeds from sale of premises and equipment        27        164        13
   Purchase of real estate                           (249)       ---       ---
   Proceeds from sale of real estate owned            217        ---       ---
   Acquisition of subsidiaries, net
     of cash received                                 ---        ---   (14,424)
                                                 --------    -------  --------
            Net cash from investing activities     23,025     35,999   (82,460)
                                                 --------    -------  --------
</TABLE>

                See accomanying notes to financial statements.


                                 (Continued)



<PAGE>

<TABLE>
<CAPTION>

                      WESTERN OHIO FINANCIAL CORPORATION


                      WESTERN OHIO FINANCIAL CORPORATION
              CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
                 Years Ended December 31, 1998, 1997, and 1996
                             (Dollars in thousands)



                                                    1998        1997     1996
                                                  -------     ------    -----
<S>                                               <C>         <C>       <C>   

Cash flows from financing activities
   Cash paid for sale of branches                 (78,453)       ---       ---
   Net increase in deposits                        30,422     13,706    17,284
   Net change in advance payments by borrowers
     for taxes and insurance                          (12)        60       463
   Proceeds from Federal Home Loan Bank advances   76,190     93,640    87,963
   Repayments of Federal Home Loan Bank advances  (59,277)  (127,903)  (19,571)
   Cash dividends paid                             (2,142)    (2,219)   (2,275)
   Proceeds from stock options exercised              351      1,863        51
   Purchase of treasury stock                      (6,611)      (370)   (4,187)
                                                 --------  ---------  --------
            Net cash from financing activities    (39,532)   (21,223)   79,728
                                                 --------  ---------  --------

Net change in cash and cash equivalents           (17,385)    15,628    (1,994)

Cash and cash equivalents at beginning of year     31,239     15,611    17,605
                                                 --------  ---------  --------

Cash and cash equivalents at end of year         $ 13,854  $  31,239  $ 15,611
                                                 ========  =========  ========

Supplemental disclosures of cash flow information
   Cash paid during the year for
      Interest                                   $ 16,171  $  17,926  $ 13,396
      Income taxes                                  2,425      1,010       861
   Noncash activities
      Transfer of portfolio loans to loans held
        for sale                                    2,767        ---       ---

</TABLE>



               See notes to accompanying financial statements.

  
<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)





WESTERN OHIO FINANCIAL  CORPORATION NOTES TO CONSOLIDATED  FINANCIAL  STATEMENTS
December 31, 1998, 1997, and 1996 (Dollars in thousands, except per share data)

     NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPALS  OF   CONSOLIDATION:   The  accompanying   consolidated   financial
statements include the accounts of Western Ohio Financial  Corporation and its
wholly  owned  subsidiary,  Cornerstone  Bank,  together  referred  to as "the
Corporation."  The financial  statements of Cornerstone  Bank  ("Cornerstone")
include the accounts of its wholly-owned  subsidiaries,  West Central Mortgage
Services,  Inc. ("WCMS") and West Central Financial  Services,  Inc. ("WCFS").
Intercompany transactions and balances are eliminated in consolidation.

NATURE OF OPERATIONS:  The Corporation's  revenues,  operating income and assets
are primarily from the banking industry. The Corporation operates six offices in
west  central  Ohio.  Loan  customers  include  a  wide  range  of  individuals,
businesses  and other  organizations.  Major  portions  of loans are  secured by
various forms of collateral  including real estate,  business  assets,  consumer
property and other items. The  Corporation's  primary funding source is deposits
from customers in its market area. The  Corporation  also purchases  investments
and engages in mortgage banking operations.

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

CASH FLOW REPORTING: Cash and cash equivalents include cash on hand, amounts due
from depository  institutions,  federal funds sold and interest bearing deposits
in other  financial  institutions  with original  maturities of 90 days or less.
Cash flows are reported net for customer loan and deposit transactions.

SECURITIES:  Securities  are  classified  as held to  maturity  and  carried  at
amortized cost when  management has the positive intent and ability to hold them
to maturity.  Securities are classified as available for sale when they might be
sold before maturity.  Securities  available for sale are carried at fair value,
with  unrealized   holding  gains  and  losses  reported   separately  in  other
comprehensive  income.  Securities  are  classified  as  trading  when  held for
short-term  periods  in  anticipation  of market  gains and are  carried at fair
value.  Other  securities  such as  Federal  Home Loan Bank  ("FHLB")  stock are
carried at cost.  Securities  are  written  down to fair value when a decline in
fair value is not considered temporary.

Gains and  losses  on sales  are  determined  using  the  amortized  cost of the
specific  security  sold.  Interest  income  includes  amortization  of purchase
premiums and discounts.

LOANS AND LOANS  HELD FOR SALE:  Loans are  reported  at the  principal  balance
outstanding,  net of unearned  interest,  deferred  loan fees and costs,  and an
allowance for loan losses. Loans held for sale are reported at the lower of cost
or market, on an aggregate basis.

Interest income is reported on the interest method and includes  amortization of
net  deferred  loan fees and costs  over the loan term.  Interest  income is not
reported  when  full loan  repayment  is in  doubt,  typically  when the loan is
impaired or payments are past due over 90 days.  Payments received on such loans
are reported as principal reductions.




                                 (Continued)



<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       DECEMBER 31, 1998, 1997 AND 1996
                (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)


     NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

ALLOWANCE  FOR LOAN  LOSSES:  The  allowance  for  loan  losses  is a  valuation
allowance for probable credit losses, increased by the provision for loan losses
and  decreased  by  charge-offs  net of  recoveries.  Management  estimates  the
allowance  balance required using past loan loss experience,  known and inherent
risks in the nature  and volume of the  portfolio,  information  about  specific
borrower situations and estimated collateral values,  economic  conditions,  and
other factors.  Allocations of the allowance may be made for specific loans, but
the entire  allowance is available for any loan that, in management's  judgment,
should be charged off.

A loan is  impaired  when full  payment  under the loan  terms is not  expected.
Impairment  is evaluated in total for  smaller-balance  loans of similar  nature
such as  residential  mortgage,  consumer,  and  credit  card  loans,  and on an
individual loan basis for other loans.  If a loan is impaired,  a portion of the
allowance is allocated so that the loan is reported,  net, at the present  value
of  estimated  future cash flows using the loan's  existing  rate or at the fair
value of collateral if repayment is expected solely from the collateral.

FORECLOSED  ASSETS:  Assets acquired  through or instead of loan foreclosure are
initially  recorded at fair value when acquired,  establishing a new cost basis.
If fair value declines, a valuation allowance is recorded through expense. Costs
after acquisition are expensed.

PREMISES AND EQUIPMENT:  Asset cost is reported net of accumulated depreciation.
Depreciation  expense is calculated using  straight-line and accelerated methods
based on the estimated useful lives of the assets. These assets are reviewed for
impairment  when events  indicate  the carrying  amount may not be  recoverable.
Maintenance and repairs are charged to expense as incurred and  improvements are
capitalized.

SERVICING RIGHTS: Servicing rights are recognized as assets for purchased rights
and for the  allocated  value  of  retained  servicing  rights  on  loans  sold.
Servicing  rights  are  expensed  in  proportion  to,  and over the  period  of,
estimated net  servicing  revenues.  Impairment  is evaluated  based on the fair
value of the rights,  using  groupings  of the  underlying  loans as to interest
rates and then,  secondarily,  as to geographic and prepayment  characteristics.
Any  impairment  of a  grouping  is  reported  as a  valuation  allowance.  Loan
servicing rights totaled $28 and $40 at year-end 1998 and 1997.

INTANGIBLES:  Purchased intangibles,  primarily goodwill and core deposit value,
are  recorded  at  cost  and  amortized  over  the  estimated   life.   Goodwill
amortization is straight-line over twenty years and core deposit amortization is
accelerated over ten years.

LONG-TERM ASSETS:  These assets are reviewed for impairment when events indicate
their  carrying  amount may not be  recoverable  from future  undiscounted  cash
flows. If impaired, the assets are recorded at discounted amounts.

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

STOCK COMPENSATION:  Employee  compensation  expense under stock option plans is
reported if options  are granted  below  market  price at grant date.  Pro forma
disclosures  of net income and earnings per share are shown using the fair value
method of SFAS No. 123 to measure expense for options granted after 1994,  using
an option pricing model to estimate fair value.

<PAGE>

EMPLOYEE STOCK  OWNERSHIP  PLAN: The cost of shares issued to the employee stock
ownership plan ("ESOP"),  but not yet allocated to  participants,  is shown as a
reduction of shareholders'  equity.  Compensation expense is based on the market
price of shares as they are  committed to be released to  participant  accounts.
Dividends  on  allocated  ESOP shares  reduce  retained  earnings;  dividends on
unearned ESOP shares reduce debt and accrued interest.

MANAGEMENT  RECOGNITION  PLAN: The cost of unawarded and unearned shares held by
the management recognition plan ("MRP") is shown as a reduction of shareholders'
equity.  The cost of shares awarded to  participants  is amortized to expense as
the shares are earned over the vesting  periods of the awards on a straight-line
method.

FAIR VALUE OF FINANCIAL  INSTRUMENTS:  Fair values of financial  instruments are
estimated using relevant market information and other assumptions, as more fully
disclosed in a separate note. Fair value  estimates  involve  uncertainties  and
matters  of  significant   judgment  regarding  interest  rates,   credit  risk,
prepayments,  and other factors,  especially in the absence of broad markets for
particular  items.   Changes  in  assumptions  or  in  market  conditions  could
significantly affect the estimates.

DIVIDEND  RESTRICTION:  Banking  regulations  require the maintenance of certain
capital  levels  which  may limit the  amount  of  dividends  which may be paid.
Regulatory  capital  requirements  and  dividend  restrictions  are  more  fully
disclosed in a separate note.

COMPREHENSIVE  INCOME:  Under a new  accounting  standard  adopted on January 1,
1998,  comprehensive  income is reported for all periods.  Comprehensive  income
includes  both net income and other  comprehensive  income,  which  includes the
change in unrealized gains and losses on securities available for sale.

EARNINGS PER SHARE:  Earnings per share is computed in accordance  with SFAS No.
128, which requires dual  presentation  of basic and diluted  earnings per share
("EPS") for entities with complex capital structures.  Basic EPS is based on net
income divided by the weighted average number of shares  outstanding  during the
period.  Diluted EPS includes the dilutive  effect of stock options  granted and
unearned MRP shares using the treasury stock method.  Unreleased ESOP shares are
not  considered  to be  outstanding  shares for the purpose of  determining  the
weighted-average  number  of  shares  used  in the  earnings  per  common  share
calculation.

Earnings   per  common   share  is  computed  by  dividing  net  income  by  the
weighted-average number of shares outstanding for the year. The weighted-average
number of common  shares  outstanding  for basic and diluted  earnings per share
computations were as follows:

<TABLE>
<CAPTION>

                                                     1998        1997      1996
                                                  ----------  --------- ----------
   <S>                                            <C>         <C>       <C>
 

   Weighted-average shares outstanding - Basic    $2,173,140 $2,232,290 $2,254,598
   Effect of stock options                            32,509     46,993     41,991
   Effect of unearned MRP shares                      13,263        ---        ---
                                                  ---------- ---------- ----------
   Weighted-average shares outstanding - Diluted  $2,218,912 $2,279,283 $2,296,589
                                                  ========== ========== ==========

</TABLE>

INDUSTRY SEGMENT:  Internal financial information is primarily
reported and aggregated solely in the line of business of banking.

RECLASSIFICATIONS:   Some   items   in   prior   financial   statements   have
been reclassified to conform with the current presentation.




                                 (CONTINUED)

 

<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       DECEMBER 31, 1998, 1997 AND 1996
                (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)






NOTE 2 - ACQUISITION OF SUBSIDIARIES AND SALE OF BRANCH OFFICES

In 1996, the Corporation acquired Mayflower Federal Savings Bank and Seven Hills
Savings  Association.  Both  institutions  were located in Cincinnati,  Ohio and
operated in  southwestern  Ohio and northern  Kentucky.  The  acquisitions  were
treated as purchases for accounting  purposes.  In 1997, these institutions were
merged into Cornerstone as retail branch offices.  In 1998, the Corporation sold
its Cincinnati,  Ohio area branch offices which  consisted  solely of the former
Mayflower  Federal  Savings  Bank and Seven  Hills  Savings  Association  branch
offices. Details of these transactions are as follows:

The acquisition costs were as follows:
<TABLE>
<CAPTION>

                                                          MAYFLOWER  SEVEN HILLS
                                                          ---------  -----------
      <S>                                                 <C>        <C>    

      Purchase price and related expenses                 $10,149     $10,652
                                                          =======     =======

      Amount assigned to specific assets and liabilities  $ 6,755     $ 9,794

      Amount assigned to goodwill:
         Core deposits                                        945         858
         Other                                              2,449         ---
                                                          -------     -------
                                                          $10,149     $10,652
                                                          =======     =======

</TABLE>

The  goodwill  assigned to core  deposits  was  amortized  over ten years by the
sum-of-the-years  method;  other goodwill was amortized over twenty years by the
straight-line method.

Goodwill   amortization   expense   totaled  $295,  $425  and  $246  in  1998,
1997 and 1996.

Results of operations of the  subsidiaries  acquired during 1996 are included in
the statement of income of the Corporation  since the dates of acquisition.  Pro
forma  (unaudited)  results of operations of the  Corporation for 1996 as if the
acquisition  had taken  place at  January 1,  1996,  are shown in the  following
schedule:

<TABLE>
<CAPTION>
                                                                      Pro Forma
                                                        As Repported (Unaudited)
                                                        -----------  ----------- 
      <S>                                                <C>         <C>    

   Interest income                                       $24,160     $27,830
   Interest expense                                       13,783      16,370
                                                         -------     -------
     Net interest income                                  10,377      11,460
   Provision for loan losses                                (399)       (565)
                                                         -------     -------  
     Net interest income after provision for loan losses $ 9,978     $10,895
                                                         =======     =======
   Net income                                            $ 1,062     $   380
                                                         =======     =======

</TABLE>

<PAGE>

Details of the assets and  liabilities  sold with the branch offices in 1998 are
as follows:

<TABLE>
<CAPTION>
    <S>                                                  <C>    

   Assets
   Cash and cash equivalents                             $78,453
   Loans                                                      23
   Premises and equipment                                    586
                                                         -------
                                                         $79,602
                                                         =======
   Liabilities
   Deposits                                              $84,365
                                                         =======

</TABLE>

The net gain  realized in  connection  with the sale in 1998 was  determined  as
follows:

<TABLE>
<CAPTION>
     <S>                                                 <C>    

    Cash and cash equivalents                            $78,453
    Premium on deposits sold                               5,426
    Write-off of intangible assets                        (3,255)
    Loss on premises and equipment                          (117)
                                                         -------
     Net gain on sale of branch offices                  $ 2,054
                                                         =======
</TABLE>




                                 (CONTINUED)

 
<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)





NOTE 3 - SECURITIES

Year-end securities available for sale were as follows:

<TABLE>
<CAPTION>
 
                                                   Gross      Gross    Estimated
                                      Amortized  Unrealized Unrealized   Fair
                                        Cost       Gains      Losses     Value
                                      ---------  ---------- ---------- --------- 
<S>                                   <C>        <C>         <C>       <C> 

1998
Securities
   U.S. Treasury                       $   499   $  3       $ ---      $   502
   U.S. government agencies and
     corporations                       15,000     16        (116)      14,900
                                       -------   ----       -----      -------
      Total securities                 $15,499   $ 19       $(116)     $15,402
                                       =======   ====       =====      =======

Mortgage-backed securities
   Mortgage pass-through certificates  $50,128   $106       $(190)     $50,044
                                       =======   ====       =====      =======


1997
Securities
   U.S. government agencies and
     corporations                      $22,196   $129       $  (4)     $22,321
   Equity                                    3    131         ---          134
                                       -------   ----       -----      -------

      Total securities                 $22,199   $260       $  (4)     $22,455
                                       =======   ====       =====      =======

Mortgage-backed securities
   Mortgage pass-through certificates  $22,220   $375       $(162)     $22,433
                                       =======   ====       ======     =======

</TABLE>


At  year-end  1998 and 1997,  there were no holdings  of  securities  of any one
issuer,  other than the U.S.  government and its agencies,  in an amount greater
than 10% of shareholders' equity.

Contractual  maturities of debt  securities  available for sale at year-end 1998
were  as  follows.   Securities  not  due  at  a  single   maturity,   primarily
mortgage-backed securities, are shown separately.

<TABLE>
<CAPTION>

                                                                   Estimated
                                                      Amortized      Fair
                                                        Cost         Value
                                                      ---------    ---------

      <S>                                             <C>          <C>  

      Due in one year or less                         $    499     $   502
      Due after five year through ten years              5,000       5,016
      Due after ten years                               10,000       9,884
      Mortgage-backed securities                        50,128      50,044
                                                      --------     -------

                                                      $ 65,627     $65,446
                                                      =======      =======
</TABLE>




                                 (Continued)

 

<PAGE>

<TABLE>
<CAPTION>

                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)


Sales of available for sale securities were as follows:

                                             1998       1997       1996
                                           --------    -------    -------
   <S>                                    <C>         <C>       <C>    
   Securities
     Proceeds                              $ 15,193    $   ---   $     51
     Gross gains                                190        ---         26
     Gross losses                               ---        ---        ---

   Mortgage-backed securities
     Proceeds                                 7,119     10,684     21,770
     Gross gains                                122        ---        208
     Gross losses                                 5          5        ---


   NOTE 4 - LOANS

   Year-end loans were as follows:

                                                         1998       1997
                                                       --------   --------  
   First mortgage loans secured by:
     One-to-four family residences                     $177,109  $224,289
     Other properties                                    33,097    32,830
     Construction properties                              3,908     7,275
   Consumer and other loans:
     Consumer                                             5,194     7,851
     Commercial                                           6,914     3,886
     Loans on savings deposits                              257       485
     Home improvement loans                                  15        18
     Home equity                                         10,054     6,906
     Other                                                   13        16
                                                       --------  --------
        Total loans                                     236,561   283,556
   Less:
     Net deferred loan fees, premiums and discounts        (83)      (119)
     Loans in process                                   (2,364)    (1,784)
     Allowance for loan losses                          (3,200)    (3,922)
                                                       -------   --------  

        Net loans                                     $230,914   $277,731


</TABLE>

   Activity in the  allowance  for loan losses is  summarized as follows for the
   years ended December 31:

<TABLE>
<CAPTION>

                                           1998      1997    1996
                                          ------   -------  -------
   <S>                                    <C>       <C>     <C>   

   Beginning balance                      $3,922   $1,716   $  774
   Provision for loan losses                (363)   2,285      399
   Acquisitions                              ---      ---      577
   Loans charged-off                        (396)     (79)     (34)
   Recoveries of previous charge-offs         37      ---      ---
                                          ------   ------   ------

   Balance at end of year                 $3,200   $3,922   $1,716
                                          ======   ======   ======

</TABLE>


                                 (Continued)



<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)




Impaired  loans totaled  $2,792 at year-end 1998. A portion of the allowance for
loan losses was allocated to each of the impaired loans. The total amount of the
allowance  for loan losses  allocated  to impaired  loans was $1,287 at year-end
1998. The average recorded  investment in impaired loans was $2,799 during 1998.
Interest  income  recognized on impaired loans in 1998 totaled $47, all of which
was recognized on a cash basis.

At year-end 1997,  the  Corporation  had four loans  totaling  $3,433 which were
considered  impaired.  A specific allowance of $1,256 of the outstanding balance
was applied to those loans.

Certain  directors and executive  officers and their related interests were loan
customers of the Corporation. A summary of activity on related party loans is as
follows:

<TABLE>
<CAPTION>

                                          1998       1997
                                         -------    ------- 
   <S>                                   <C>       <C>  

   Beginning balance                     $  711    $1,445
      New loans                           1,104        41
      Repayments                           (535)     (357)
      Other changes                         (25)     (418)
                                         ------    ------

   Ending balance                        $1,255    $  711
                                         ======    ======

</TABLE>

Other  changes  represent  loans  reportable  at the end of one period  that are
excludable  from  the  other  period  due to  changes  in  borrowers  and  other
circumstances.


NOTE 5 - PREMISES AND EQUIPMENT

Year-end premises and equipment were as follows:

<TABLE>
<CAPTION>

                                          1998       1997
                                         -------    ------- 
  <S>                                   <C>        <C>    

   Land                                  $  862     $ 1,099
   Buildings and improvements             3,416       3,845
   Furniture, fixtures and equipment      2,009       2,040
                                         ------     -------
                                          6,287       6,984
   Accumulated depreciation              (3,046)     (3,060)
                                         ------     -------
                                         $3,241     $ 3,924
                                         ======     =======
</TABLE>




                                 (Continued)

 

<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)




Certain  facilities  and  equipment  are  leased  under  various  non-cancelable
operating leases,  which expire at various dates through 2001. Rental expense on
lease  commitments  amounted to $165 and $135 in 1998 and 1997.  Future  minimum
lease payments on lease obligations are as follows:



                  1999                                $    153
                  2000                                     135
                  2001                                      17
                                                      --------
                                                      $    305
                                                      ======== 

NOTE 6 - ACCRUED INTEREST RECEIVABLE

Accrued interest receivable consisted of the following at year-end:

<TABLE>
<CAPTION>


                                                        1998      1997
                                                       -------   -------             

   <S>                                               <C>         <C>  

   Securities                                         $   226    $  486
   Mortgage-backed securities                             311       182
   Loans and loans held for sale                        1,360     1,692
                                                      --------   ------
                                                      $ 1,897    $2,360
                                                      =======    ======

</TABLE>

NOTE 7 - DEPOSITS

Year-end deposits were as follows:

<TABLE>
<CAPTION>

                                                         1998      1997
                                                      -------     -------
  <S>                                                  <C>       <C>   
 
   NOW accounts, including noninterest-bearing
     deposits of $1,857 and $1,317                    $ 12,708   $ 12,186
   Money market accounts                                49,084     37,182
   Passbook savings accounts                            13,629     22,115
   Certificates of deposit:
      In denominations under $100,000                  103,204    152,492
      In denominations of $100,000 or more              14,341     22,934
                                                      --------   --------
                                                      $192,966   $246,909
                                                      ========   ========

</TABLE>

At year-end  1998,  scheduled  maturities  of  certificates  of deposit  were as
follows:
<TABLE>
<CAPTION>
<S>               <C>                                  <C>    
                  1999                                $ 57,002
                  2000                                  42,874
                  2001                                  13,305
                  2002                                   1,477
                  2003                                   1,799
                  Thereafter                             1,088
                                                       -------
                                                      $117,545
                                                      ========
</TABLE>


                                 (Continued)


<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)





NOTE 8- BORROWED FUNDS

Borrowed  funds at year-end 1998 and 1997 consisted of advances from the Federal
Home Loan Bank of Cincinnati ("FHLB") and were as follows:
<TABLE>
<CAPTION>


                                           Current
                                      Weighted-Average
                                        Interest Rate    1998      1997
                                      ----------------   -----     -----
<S>                                   <C>                <C>       <C>    

   Fixed rate advances with
    monthly interest payments,
    principal due in:

        1998                                5.93%      $   ---    $43,540
        1999                                5.62        30,500     20,000
        2000                                6.45         1,000      1,000
        2001                                8.35           340        340
        2008                                4.94        50,000        ---
                                                       -------    -------  
                                            5.23       $81,840    $64,880
                                                       -------    -------

   Fixed rate  advances  with
    monthly  principal  and
    interest  payments, final
    principal due in:

        2003                                5.89%          415        421
        2004                                7.01         2,692      2,730
        2005                                7.17           305        308
                                                       -------    -------
                                            6.89         3,412      3,459
                                                       -------    -------
                                            5.30       $85,252    $68,339
                                                       =======    =======
</TABLE>


   The maximum  month-end  balance of FHLB advances  outstanding was $88,256 and
   $113,112 in 1998 and 1997. Average balances of borrowings  outstanding during
   1998  and 1997  were  $62,803  and  $86,929.  Advances  under  the  borrowing
   agreements  are  collateralized  by a  blanket  pledge  of the  Corporation's
   residential mortgage loan portfolio and FHLB stock.

   At year-end 1998, required annual principal payments were as follows:

<TABLE>
<CAPTION>

<S>               <C>                                <C>    
                  1999                                $ 30,551
                  2000                                   1,055
                  2001                                     399
                  2002                                      63
                  2003                                     439
                  Thereafter                            52,745
                                                      --------
                                                      $ 85,252
                                                      ========
</TABLE>




                                 (Continued)



<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)



NOTE 9 - EMPLOYEE BENEFIT PLANS

EMPLOYEE STOCK OWNERSHIP PLAN: The Corporation offers an ESOP for the benefit of
all salaried employees who meet age and service requirements.  The ESOP borrowed
funds  from  the  Corporation  with  which  to  acquire  common  shares  of  the
Corporation.  The loan is secured by the shares purchased with the loan proceeds
and will be repaid by the ESOP with funds from the  Corporation's  discretionary
contributions  to the ESOP and  earnings  on ESOP  assets.  The shares are being
allocated to eligible  employees'  accounts over a ten year period which started
in 1994. Expense for shares committed to be allocated during 1998, 1997 and 1996
was $358, $379 and $324.

The ESOP shares at year-end 1998 and 1997 were as follows:
<TABLE>
<CAPTION>

                                                       1998         1997
                                                      ------      -------
<S>                                                   <C>         <C>        


      Allocated shares                                52,073      37,195
      Shares committed to be released for allocation  14,878      14,878
      Unreleased shares                               81,830      96,708
                                                    --------     -------
         Total ESOP shares                           148,781     148,781
                                                    ========     =======
 
      Fair value of unreleased shares               $  1,780     $ 2,599
                                                    ========     =======
</TABLE>


MANAGEMENT RECOGNITION PLAN: The Corporation maintains an MRP for the benefit of
directors  and  certain key  employees  of the  Corporation.  The MRP is used to
provide  such  individuals  ownership  interest in the  Corporation  in a manner
designed to  compensate  such  directors  and key  employees for services to the
Corporation.  As of December  31,  1998,  65,505  shares of the initial  105,800
shares  have  been  awarded.  One-fifth  of  such  shares  will  be  earned  and
non-forfeitable  on each of the  first  five  anniversaries  of the dates of the
awards.  Grantees have all the benefits of shareholders,  including the right to
receive dividends, except for certain restrictions on the transferability of the
shares.  Compensation  expense,  which is based upon the cost of the shares, was
$172, $444 and $247 for 1998, 1997 and 1996.

DEFERRED  COMPENSATION  PLANS: In 1996, the Corporation  adopted a non-qualified
deferred  compensation  plan for two  officers.  Under the plan,  those  covered
agreed to defer a portion of their current  compensation  in exchange for future
payments.  The  liability for the future  payments is secured by  single-premium
life insurance policies on each of the individuals covered.

In 1998, the Corporation  established a non-qualified deferred compensation plan
for the  benefit of certain  officers  and  directors.  Eligible  employees  may
allocate up to 100% of compensation (base salary, bonus, MRP, annual retainer or
meeting fees) to their deferred compensation accounts.

401(K) PROFIT SHARING PLAN: The Corporation  offers a 401(k) profit sharing plan
covering substantially all employees. The annual expense of the plan is based on
a partial matching of voluntary employee contributions of up to 6% of individual
compensation.  The matching percentage was 50% for 1998, 1997 and 1996. Employee
contributions   are  vested  at  all  times  and  the   Corporation's   matching
contributions  become fully vested after an individual  has completed 5 years of
service.  The cash  contribution  expense  included  in  salaries  and  employee
benefits was $45, $35 and $16 for 1998, 1997 and 1996.




                                 (Continued)



<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)



STOCK OPTION AND  INCENTIVE  PLANS:  In January 1995,  shareholders  approved an
Incentive  Stock Option Plan.  Under the provisions of the Plan,  264,500 shares
have been allocated for  non-qualified and incentive stock options to be granted
to directors and selected  employees.  Grantees are awarded  10-year  options to
acquire  shares  at the  market  price on the date the  option is  granted.  The
options  fully vest and become  exercisable  in five equal  annual  installments
commencing one year after the date of the grant.

In April 1997,  shareholders approved conversion of Seven Hills stock options to
Western Ohio  Financial  Corporation  options.  Accordingly,  43,057  options to
purchase  stock in Western Ohio  Financial  Corporation at a price of $11.47 per
share were issued.

In April  1998,  shareholders  approved  an Omnibus  Incentive  Plan.  Under the
provisions of the plan, 235,224 shares have been allocated for non-qualified and
incentive  stock  options to be granted to  directors  and  selected  employees.
Grantees are awarded  10-year  options to acquire  shares at the market price on
the date the option is granted.  The options are fully vested and exercisable on
the date of the grant.

The following is a summary of activity in the stock option and incentive plan:
<TABLE>
<CAPTION>

                                                  Stock Options
                                        ----------------------------------------
                                                                  Weighted-
                                          Options                  Average
                                         Available    Options     Exercise
                                         for Grant  Outstanding     Price
                                         --------- ------------   ---------
<S>                                      <C>        <C>           <C>    

    January 1, 1996                       28,229     236,271       $17.74

      Forfeited                            6,000      (6,000)       17.50
      Exercised                              ---      (3,000)       17.50
                                        --------   ---------

    December 31, 1996                     34,229     227,271        17.75

      Plan amended (Acquisition)          43,057         ---          ---
      Granted                            (77,057)     77,057        16.76
      Forfeited                            6,000      (6,000)       17.50
      Exercised                              ---    (107,958)       16.25
                                        --------   ---------

    December 31, 1997                      6,229     190,370        18.17

      Plan adopted                       235,224         ---          ---
      Granted                            (32,936)     32,936        23.00
      Forfeited                            1,690      (1,690)       15.23
      Exercised                              ---     (19,882)       18.39
                                        --------   ---------

    December 31, 1998                    210,207     201,734        19.22
                                        ========   =========

</TABLE>


                                 (Continued)



<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)







The following table summarizes  information  about stock options  outstanding at
year-end 1998:
<TABLE>
<CAPTION>

                     Weighted Average
                       Remaining          Number
   Exercise Price   Contractual Life   Outstanding Exercisable
   --------------   ----------------   ----------- -----------
<S>                 <C>                <C>          <C>    

   $   11.47            8.30 years       12,751       12,751
       17.50            6.09             84,375       39,638
       18.50            6.30             27,672       18,602
       19.75            6.39              5,000        3,000
       20.50            6.55              5,000        3,000
       21.75            8.38              1,000          200
       22.00            8.49             25,000        5,000
       23.00            9.87             32,936       32,936
       26.63            8.81              8,000        1,600
                                        -------      -------
                                        201,734      116,727
                                        =======      =======

</TABLE>

No stock appreciation rights or restricted stock awards have been granted.

The fair value of options granted in 1998 was estimated using the  Black-Scholes
option pricing model using the following assumptions: risk-free interest rate of
4.81%,  expected life of 5 years,  expected  volatility of stock price of 18.48%
and expected dividend rate of 4.44%. Based on these  assumptions,  the estimated
fair value of options granted in 1998 was $3.16 per option.

The fair value of options  granted prior to 1998 were also  estimated  using the
Black-Scholes  option pricing model using the following  assumptions:  risk-free
interest rate of 6.12% to 7.24%,  expected life of 10 years; expected volatility
of stock price of .05% to .17% and an expected annual dividend rate of $1.00 per
share.

SFAS No. 123,  "Accounting  for Stock Based  Compensation,"  requires  pro forma
disclosures  for  companies  not adopting its fair value  accounting  method for
stock-based  employee  compensation.   Accordingly,   the  following  pro  forma
information  presents net income and earnings per share for 1998,  1997 and 1996
had the Standard's fair value method been used to measure  compensation cost for
stock  option  plans.  No  compensation  expense  related to stock  options  was
actually recognized.

<TABLE>
<CAPTION>

                                        1998           1997         1996
                                        ----           ----         ----
  
   <S>                               <C>           <C>          <C>    
   Net income:
         As reported                  $ 1,295      $    183      $ 1,062
         Pro forma                      1,132             5          974

      Earnings per share:
         As reported
            Basic                     $   .60      $    .08      $   .47
            Diluted                       .58           .08          .46
         Pro forma
            Basic                         .52           ---          .43
            Diluted                       .51           ---          .42

</TABLE>


                                 (Continued)

 

<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)





      NOTE 10 - COMMITMENTS, OFF-BALANCE SHEET RISK AND CONTINGENCIES

LITIGATION:  Various  contingent  liabilities are not reflected in the financial
statements, including claims and legal actions arising in the ordinary course of
business.  In the opinion of management,  after consultation with legal counsel,
the  ultimate  disposition  of these  matters is not expected to have a material
effect on financial condition or results of operations.

COMMITMENTS TO EXTEND CREDIT: Some financial  instruments are used in the normal
course  of  business  to meet  financing  needs of  customers.  These  financial
instruments include commitments to extend credit,  standby letters of credit and
financial guarantees.  These involve, to varying degrees,  credit risk in excess
of the amount reported in the financial statements.

Exposure to credit loss if the other  party does not perform is  represented  by
the  contractual  amount for  commitments to extend credit,  standby  letters of
credit and financial  guarantees written.  The same credit policies are used for
commitments  and  conditional  obligations as are used for loans.  The amount of
collateral  obtained,  if deemed  necessary,  on extension of credit is based on
management's   credit  evaluation  and  generally  consists  of  residential  or
commercial  real  estate.  Lines of  credit  are  primarily  home  equity  lines
collateralized by second mortgages on one-to-four family residential real estate
and commercial lines of credit collateralized by business assets.

Commitments  to extend  credit are  agreements  to lend to a customer as long as
there  is  no  violation  of  any  condition   established  in  the  commitment.
Commitments  generally have fixed expiration dates or other termination  clauses
and may require  payment of a fee. Since many of the commitments are expected to
expire without being used, the total  commitments do not  necessarily  represent
future cash requirements.

At year-end 1998 and 1997, the  Corporation  had  commitments to originate loans
and amounts available on approved lines of credit as follows:

<TABLE>
<CAPTION>

                                              Fixed     Variable
                                               Rate       Rate      Total

                                            --------  ---------  --------
      <S>                                   <C>       <C>        <C>
      1998
      First mortgage loans                  $ 1,573   $    515   $ 2,088
      Consumer and other loans                  ---      1,506     1,506
      Commercial loans                          ---        868       868
      Home equity lines of credit               ---      7,304     7,304
      Commercial lines of credit                         2,640     2,640
      Stand-by letters of credit                 35        ---        35
                                            -------   --------   -------

                                            $ 1,608   $ 12,833   $14,441
                                            =======   ========   =======

      1997
      First mortgage loans                  $    32   $  1,230   $ 1,262
      Consumer and other loans                  ---      1,057     1,057
      Home equity lines of credit               ---      3,413     3,413
      Commercial lines of credit                ---      2,596     2,596
                                           --------   --------   -------

                                            $    32   $  8,296   $ 8,328
                                            =======   ========   =======

</TABLE>

The interest rates on fixed-rate loan commitments ranged from 5.50% to 7.38 % at
year-end 1998.



                                 (Continued)

 

<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)



EMPLOYMENT  AGREEMENTS:  The Corporation has employment  agreements with certain
officers of the Corporation and Cornerstone.  The agreements  provide for a term
of employment for up to three years and a salary and performance review not less
often than  annually,  as well as  inclusion  of the  employee  in any  formally
established  employee  benefit plan for which such  personnel are eligible.  The
employment  agreements also contain  provisions with respect to payment should a
change in control occur.

LIQUIDATION  ACCOUNT:  In conjunction with its conversion to a stock institution
in 1994, the Corporation established a liquidation account of $21,664, which was
equal to its total net worth as of the date of the latest statement of financial
condition appearing in the final conversion prospectus.  The liquidation account
is maintained  for the benefit of eligible  depositors  who continue to maintain
their  accounts  with the  Corporation  after the  conversion.  The  liquidation
account is reduced annually to the extent that eligible  depositors have reduced
their  qualifying  deposits.  Subsequent  increases  do not  restore an eligible
account holder's interest in the liquidation account. In the event of a complete
liquidation,  each eligible depositor will be entitled to receive a distribution
from the liquidation account in an amount  proportionate to the current adjusted
qualifying balances for accounts then held.


NOTE 11 - DISCLOSURES ABOUT FAIR VALUES OF FINANCIAL INSTRUMENTS

The  carrying  values and  estimated  fair values of  financial  instruments  at
year-end were as follows:
<TABLE>
<CAPTION>
 
                                          1998                  1997
                                   --------------------   ------------------
                                   Carrying     Fair      Carrying    Fair
                                    Amount      Value      Amount     Value
                                   ---------   --------   ---------  --------
<S>                               <C>        <C>         <C>        <C>   

Financial assets:
   Cash and cash equivalents       $  13,854   $ 13,854   $ 31,239   $ 31,239
   Securities available for sale      15,402     15,402     22,455     22,455
   Mortgage-backed securities
     available for sale               50,044     50,044     22,433    22,433
   FHLB stock                          6,948      6,948      6,470     6,470
   Loans, net                        230,914    233,942    277,731   283,349
   Loans held for sale                 3,898      3,898        ---       ---
   Accrued interest receivable         1,897      1,897      2,360     2,360

Financial liabilities:
   Deposits                         (192,966)  (194,072)  (246,909)  (247,504)
   Borrowed funds                    (85,252)   (82,754)   (68,339)   (68,337)
   Advance payments by borrowers
     for taxes and insurance            (881)      (881)      (893)      (893)
   Accrued interest payable             (486)      (486)      (665)      (665)

</TABLE>


                                 (Continued)




<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)



The estimated fair value approximates carrying amount for all items except those
described  below.  Estimated  fair  value  for  securities  and  mortgage-backed
securities is based on quoted market values for the individual securities or for
equivalent securities.  Estimated fair values of fixed-rate loans and loans that
reprice  less  frequently  than each  year,  are based on the rates  charged  at
year-end  for new  loans  with  similar  maturities,  applied  until the loan is
assumed to reprice or be paid. Estimated fair values for certificates of deposit
and  long-term  debt are based on the rates paid at year-end for new deposits or
borrowings  applied until  maturity.  Estimated fair values for other  financial
instruments and off-balance-sheet loan commitments are considered nominal.

While  these  estimates  of fair  value are based on  management's  judgment  of
appropriate  factors,  there is no assurance  that, were the Corporation to have
disposed  of such items at year-end  1998 and 1997,  the  estimated  fair values
would  necessarily  have been  achieved at that date,  since  market  values may
differ depending on various circumstances. The estimated fair values at year-end
1998 and 1997 should not necessarily be considered to apply at subsequent dates.

In addition,  other assets,  such as property and equipment,  and liabilities of
the Corporation  that are not defined as financial  instruments are not included
in  the  above  disclosures.   Also,  non-financial  instruments  typically  not
recognized  in  financial  statements  nevertheless  may have  value but are not
included  in the above  disclosures.  These  include,  among  other  items,  the
estimated  earning  power of core  deposit  accounts,  the  trained  work force,
customer goodwill and similar items.


NOTE 12 - SAVINGS ASSOCIATION INSURANCE FUND RECAPITALIZATION

Included in deposit insurance  premium expense in the accompanying  consolidated
statement  of income  for the year  ended  December  31,  1996,  is $1,064 for a
special  assessment  resulting from  legislation  passed and enacted into law on
September 30, 1996, to recapitalize  the Savings  Association  Insurance Fund of
the Federal Deposit Insurance Corporation.  Thrifts such as the Corporation paid
a one-time assessment in November,  1996, of $0.657 for each $100 in deposits as
of March 31, 1995. Because of the recapitalization, the Corporation began paying
lower deposit insurance premiums in January, 1997.

NOTE 13 - INCOME TAXES

Income tax expense consisted of the following:

<TABLE>
<CAPTION>

                                             1998       1997      1996
                                            ------    ------    -------
      <S>                                  <C>         <C>      <C>   

      Current                               $ 2,935   $   630   $   686
      Deferred                                  (71)     (472)       21
                                            -------   -------   -------

                                            $ 2,864   $   158   $   707
                                            =======   =======   =======


</TABLE>


                                 (Continued)

 
<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)






The sources of year-end gross deferred income tax assets and liabilities were as
follows:

<TABLE>
<CAPTION>

                                                        1998         1997
                                                       ------       ------
<S>                                                    <C>          <C>   

Deferred tax assets
   Deferred compensation and management
     recognition plan                                 $     61     $   144
   Allowance for loans losses                            1,034       1,094
   Unrealized loss on securities available for sale         62         ---
   Other                                                    59         ---
                                                      --------     -------
                                                         1,216       1,238
Deferred tax liabilities
   FHLB stock dividends                                    752         699
   Depreciation                                            ---          57
   Adjustment for former use of cash basis accounting
     method for income tax reporting                       ---          99
   Unrealized gain on securities available for sale        ---         159
   Other                                                   ---          52
                                                      --------     -------
                                                           752       1,066

                                                      $    464     $   172
                                                      ========     =======

</TABLE>

Total income tax expense differed from the amounts computed by applying the U.S.
federal  income tax rate of 34% to income before income taxes as a result of the
following:

<TABLE>
<CAPTION>

                                              1998      1997     1996
                                            -------   -------   ------
   <S>                                      <C>       <C>       <C>  

   Income tax computed at the
     statutory tax rate                     $ 1,414    $  116   $  601
   Tax effect of:
      Dividend exclusion                        ---       (17)      (1)
      Intangible assets                       1,372       145       81
      Other                                      78       (86)      26
                                            -------    ------   ------

                                            $ 2,864    $  158   $  707
                                            =======    ======   ======

   Effective tax rate                          68.9%     46.3%   40.0%
                                               ====      ====    ====

</TABLE>

<PAGE>
Prior to the enactment of legislation discussed below, thrifts which met certain
tests  relating to the  composition  of assets had been  permitted  to establish
reserves for bad debts and to make annual additions thereto which could,  within
specified  formula limits,  be taken as a deduction in computing  taxable income
for federal  income tax purposes.  The amount of the bad debt reserve  deduction
for "non-qualifying  loans" was computed under the experience method. The amount
of the bad debt reserve  deduction for "qualifying real property loans" could be
computed under either the experience  method or the percentage of taxable income
method, based on an annual election.

In August 1996,  legislation was enacted that repealed the percentage of taxable
income  method of  accounting  used by many thrifts to calculate  their bad debt
reserve for federal income tax purposes.  As a result, small thrifts such as the
Corporation  must  recapture that portion of the reserve that exceeds the amount
that could have been taken under the experience  method for tax years  beginning
after December 31, 1987. The  legislation  also requires  thrifts to account for
bad debts for federal income tax purposes on the same basis as commercial  banks
for tax years beginning after December 31, 1995. The recapture will occur over a
six-year  period.  The  commencement  of the  recapture by the  Corporation  was
delayed  until  1998  as  the  Corporation  met  certain   residential   lending
requirements.  In 1998, the Corporation  recaptured $52 in bad debt reserves. At
December 31, 1998, the Corporation had $260 in bad debt reserves remaining to be
recaptured  for  federal  income  tax  purposes  over the next five  years.  The
deferred tax liability related to the recapture has been previously established.

Retained  earnings at December 31, 1998 and 1997,  includes  $8,709 for which no
provision for federal  income taxes has been made.  This amount  represents  the
qualifying  and  non-qualifying  tax bad debt  reserve as of December  31, 1987,
which is the  Corporation's  base year for purposes of calculating  the bad debt
deduction  for tax purposes.  The related  amount of  unrecognized  deferred tax
liability  was $2,961 at December 31, 1998 and 1997. If this portion of retained
earnings is used in the future for any  purpose  other than to absorb bad debts,
it will be added to future taxable income.


NOTE 14 - REGULATORY CAPITAL REQUIREMENTS

Cornerstone is subject to various regulatory capital  requirements  administered
by the federal regulatory agencies. Failure to meet minimum capital requirements
can initiate certain mandatory actions that, if undertaken,  could have a direct
material effect on Cornerstone's  financial  statements.  Under capital adequacy
guidelines  and  the  regulatory   framework  for  prompt   corrective   action,
Cornerstone  must meet specific  capital  guidelines  that involve  quantitative
measures of  Cornerstone's  assets,  liabilities  and certain  off-balance-sheet
items as calculated under regulatory accounting practices. Cornerstone's capital
amounts and  classifications  are also subject to  qualitative  judgments by the
regulators about Cornerstone's components, risk weightings and other factors. At
year-end 1998 and 1997,  management  believes  Cornerstone is in compliance with
all regulatory capital requirements.  Cornerstone is considered well capitalized
under the Federal Deposit Insurance Act at year-end 1998 and 1997. Management is
not aware of any matters  subsequent  to  December  31,  1998,  that would cause
Cornerstone's capital category to change.

The following is a reconciliation of capital under generally accepted accounting
principles,  as  shown  on the  accompanying  consolidated  balance  sheets,  to
Cornerstone's regulatory capital at year-end 1998 and 1997:
<TABLE>
<CAPTION>
                                                          1998      1997
                                                        -------   --------
<S>                                                     <C>       <C> 


   Total shareholders' equity per financial statements  $47,594    $54,600
   Nonallowable items:
      Parent company equity                              (6,605)    (8,797)
      Intangible assets                                     (31)    (3,597)
      Unrealized (gain) loss on securities available
        for sale                                            120       (309)
                                                         ------     ------
   Tier I (core) and tangible capital                    41,078     41,897
   Additional capital items:
      General valuation allowances (limited)              1,769      2,433
                                                        -------    -------

   Total risk-based capital                             $42,847    $44,330
                                                        =======    =======

</TABLE>


                                 (Continued)

  


<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)




At  year-end  1998 and 1997,  Cornerstone's  actual  capital  level and  minimum
required levels under prompt corrective action regulations were as follows:

<TABLE>
<CAPTION>


                                                   Minimum          Minimum
                                                  Required         Required
                                             To Be Adequately     To Be Well
                                 Actual         Capitalized      Capitalized
                              -------------   -----------------  --------------
                              Amount  Ratio   Amount   Ratio    Amount  Ratio
                              ------  -----  --------  ------   ------- ------
<S>                           <C>     <C>     <C>       <C>      <C>      <C>

1998
Total capital
  (to risk-weighted assets)   $42,847  24.2%   $14,188   8.0%    $17,736  10.0%
Tier 1 (core) capital (to
  risk-weighted assets)        41,078  23.2      7,094   4.0      10,641   6.0
Tier 1 (core) capital
  (to adjusted total assets)   41,078  12.6     13,082   4.0      16,353   5.0
Tangible capital (to
   adjusted total assets)      41,078  12.6      4,906   1.5       N/A

1997
Total capital (to
  risk-weighted assets)       $44,330  21.6%   $16,409   8.0%    $20,511  10.0%
Tier 1 (core) capital (to
  risk-weighted assets)        41,897  20.4      8,204   4.0      12,307   6.0
Tier 1 (core) capital (to
   adjusted total assets)      41,897  11.4     11,014   3.0      18,360   5.0
Tangible capital (to adjusted
    total assets)              41,897  11.4      5,507   1.5        N/A

</TABLE>

In addition to certain federal income tax  considerations,  the Office of Thrift
Supervision  ("OTS")  regulations impose limitations on the payment of dividends
and other capital distributions by savings  associations.  Under OTS regulations
applicable to converted  savings  banks,  Cornerstone  is not permitted to pay a
cash dividend on its common shares if its regulatory  capital would, as a result
of  payment of such  dividends,  be reduced  below the amount  required  for the
Liquidation  Account,  or  below  applicable   regulatory  capital  requirements
prescribed by the OTS.

Under recently adopted OTS regulations, savings banks paying dividends in excess
of the current year and preceding two years net retained  income must first file
an application  with the OTS.  Therefore,  Cornerstone  Bank will be required to
submit an application to the OTS prior to paying dividends to the Corporation.

Cornerstone  currently meets all of its capital requirements and, unless the OTS
determines  that  Cornerstone  is an  institution  requiring  more  than  normal
supervision,  Cornerstone  may pay  dividends in  accordance  with the foregoing
provisions of OTS regulations.



                                 (Continued)

 

<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)







NOTE 15 - PARENT COMPANY ONLY CONDENSED FINANCIAL STATEMENTS

Condensed  financial  information  of Western Ohio  Financial  Corporation is as
follows:

                           CONDENSED BALANCE SHEETS
                          DECEMBER 31, 1998 AND 1997
<TABLE>
<CAPTION>

                                                        1998       1997
                                                      --------   --------
<S>                                                   <C>        <C>    

Assets
   Cash and cash equivalents                          $  5,626   $ 2,762
   Investment in bank subsidiary                        40,989    45,804
   Investment in non-bank subsidiary                       ---        37
   Intercompany receivables                                904     5,864
   Other assets                                            300       257
                                                      --------   -------
      Total assets                                    $ 47,819   $54,724
                                                      ========   =======

Liabilities and shareholders' equity
   Other liabilities                                  $    225   $   124
   Shareholders' equity                                 47,594    54,600
                                                      --------   -------
      Total liabilities and shareholders' equity      $ 47,819   $54,724
                                                      ========   =======
</TABLE>



                                 (Continued)

 
<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)





NOTE 15 - PARENT COMPANY ONLY CONDENSED FINANCIAL STATEMENTS (Continued)

                        CONDENSED STATEMENTS OF INCOME
                 YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996

<TABLE>
<CAPTION>

                                                 1998       1997       1996
                                               ---------  --------    --------
<S>                                            <C>        <C>         <C>    

INTEREST AND DIVIDEND INCOME
   Dividends from subsidiaries                  $  6,000   $ 5,002   $ 15,500
   Loan to ESOP                                      128       123        143
   Other                                              53        75        357
                                                --------   -------   --------
      Total interest and dividend income           6,181     5,200     16,000

Other income                                         ---        22         78
Operating expenses                                  (608)     (728)      (805)
                                                --------   -------   --------

Income before income taxes and distributions
  in excess of earnings of subsidiary              5,573     4,494     15,273

Income tax benefit                                   145       157         76
                                                 -------   -------   --------

Income before distributions in excess of
  earnings of subsidiary                           5,718     4,651     15,349

Distributions in excess of earnings of subsidiary (4,423)   (4,468)   (14,287)
                                                  -------  -------   --------

Net income                                      $  1,295   $   183   $  1,062
                                                ========   =======   ========
</TABLE>


                 CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
                 YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996

<TABLE>
<CAPTION>

                                                  1998       1997       1996
                                                --------   --------  ---------
<S>                                             <C>        <C>       <C>


Net Income                                      $  1,295   $   183   $  1,062

Other comprehensive income, net of tax
   Unrealized gain (loss) on available
     for sale securities arising during
     the period                                     (429)      551       (837)
   Reclassification adjustment for amount
     realized on securities sales included
     in net income                                   ---       ---        (36)
                                                --------   -------   --------
      Total other comprehensive income              (429)      551       (873)
                                                --------   -------   --------

Comprehensive income                            $    866   $   734   $    189
                                                ========   =======   ========
</TABLE>




                                 (Continued)

      

<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)





NOTE 15 - PARENT COMPANY ONLY CONDENSED FINANCIAL STATEMENTS (Continued)

                      CONDENSED STATEMENTS OF CASH FLOWS
                 YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996

<TABLE>
<CAPTION>

                                                  1998       1997       1996
                                               ---------   --------   ---------
<S>                      <C>                   <C>          <C>       <C>  


Cash flows from operating activities:
Net income                                      $  1,295   $   183   $   1,062
   Adjustments to reconcile net income to cash
     provided by operations:
      Gain on sale of securities available
        for sale                                     ---       ---        (54)
      Distributions in excess of earnings
         of subsidiary                             4,423     4,468     14,287
      Compensation expense on ESOP and MRP shares    530       544        566
      Changes in:
        Other assets                                 (43)     (172)        63
        Other liabilities                            101      (968)       927
                                                --------   -------   --------
         Net cash from operating activities        6,306     4,055     16,851

Cash flows from investing activities
   Investment in subsidiaries                        ---       (37)   (19,488)
   Proceeds from sale of investments                 ---       ---      2,915
   Intercompany advance                              ---    (5,489)      (152)
   Proceeds from repayments of
      intercompany advances                        4,960       ---        ---
                                                --------   -------   --------
         Net cash from investing activities        4,960    (5,526)   (16,725)

Cash flows from financing activities
   Cash dividends paid                            (2,142)   (2,219)    (2,275)
   Proceeds from stock options exercised             351     1,863        ---
   Purchase of treasury stock                     (6,611)     (370)    (4,129)
                                                --------   -------   --------
         Net cash from financing activities       (8,402)     (726)    (6,404)
                                                --------   -------   --------

Net change in cash and cash equivalents            2,864    (2,197)    (6,278)

Cash and cash equivalents at beginning of year     2,762     4,959     11,237
                                                --------   -------   --------

Cash and cash equivalents at end of year         $ 5,626   $ 2,762   $  4,959
                                                 ========  =======   ========

</TABLE>




                                 (Continued)




<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       December 31, 1998, 1997 and 1996
                (Dollars in thousands, except per share data)



NOTE 16 - SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

The following tables summarize selected quarterly results of operations for 1998
and 1997.

<TABLE>
<CAPTION>

                                                        Three months ended
                                                        -------------------
December 31, 1998                  March 31,   June 30,  September 30, December 31,
                                   ---------   --------  ------------- ------------
<S>                                <C>         <C>         <C>         <C>    

                                       (In thousands except per share data)

Interest and dividend income       $ 6,740     $ 6,551     $ 6,314     $ 6,251
Interest expense                     4,155       3,993       4,029       3,815
                                   -------     -------     -------     -------
Net interest income                  2,585       2,558       2,285       2,436
Provision for loan losses              ---        (261)        ---        (102)
                                   -------     -------     -------     -------
Net interest income after
  provision for loan losses          2,585       2,819       2,285       2,538
Non-interest income                    393         477         382       2,437
Non-interest expense                (2,262)     (2,544)     (2,331)     (2,620)
                                    ------     -------      ------     -------
Income before income tax               716         752         336       2,355
Income tax expense                     281         282         150       2,151
                                   -------     -------     -------     -------
Net income                         $   435     $   470     $   186     $   204
                                   =======     =======     =======     =======

Earnings per share
  Basic                            $   .19    $    .21     $   .09     $   .11
                                   =======    ========     =======     =======
  Diluted                          $   .19    $    .21     $   .08     $   .10
                                   =======    ========     =======     =======

Dividends declared per share       $   .25    $    .25     $   .25     $   .25
                                   =======    ==== ===     =======     =======
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
                                                Three months ended
                                   -----------------------------------------------
December 31, 1997                  March 31,  June 30,  September 30, December 31,
                                   ---------  --------  ------------- ------------
                                       (In thousands except per share data)
<S>                                <C>        <C>       <C>            <C>    


Interest and dividend income       $ 7,114     $ 7,414    $  7,450     $  7,061
Interest expense                     4,431       4,548       4,591        4,364
                                   -------     -------    --------     --------
Net interest income                  2,683       2,866       2,859        2,697
Provision for loan losses               67          43         246        1,929
                                   -------     -------    --------     --------
Net interest income after
  provision for loan losses          2,616       2,823       2,613          768
Non-interest income                    267         132         207          386
Non-interest expense                (2,323)     (2,226)     (2,688)      (2,234)
                                   -------     -------    --------      -------
Income before income tax               560         729         132       (1,080)
Income tax expense (benefit)           228         277          72         (419)
                                   -------     -------    --------      -------
Net income                         $   332     $   452    $     60      $  (661)
                                   =======     =======    ========      =======

Earnings per share
  Basic                            $   .15     $   .21    $   .03      $   (.31)
                                   =======     =======    =======      ========
  Diluted                          $   .15     $   .20    $   .03      $   (.30)
                                   =======     =======    =======      ========

Dividends declared per share       $   .25    $   .25     $   .25      $    .25
                                   =======    =======     =======      ========


</TABLE>


<PAGE>


                      WESTERN OHIO FINANCIAL CORPORATION
                              Springfield, Ohio


Board of Directors of Western Ohio Financial Corporation and Cornerstone Bank
<TABLE>
<CAPTION>

         <S>                          <C>
        David L. Dillahunt              Senior Vice President, Advest, Inc.
        John W. Raisbeck                President and Chief Executive Officer, Cornerstone Bank
        Howard V. Dodds                 President, Howard's Foods, Inc.
        John E. Field                   Vice Chairman of the Board, Wallace & Turner, Inc.
        Jeffrey L. Levine               President, Larry Stein Realty and Levine Realty Company
        William N. Scarff               President, Scarff's Nursery, Inc. and Scarff's Land Company
        Aristides G. Gianakopoulos      President, The Champion Company

Officers of Western Ohio Financial Company
     
        John W. Raisbeck              President and Chief Executive Officer
        John T. Heckman               Executive Vice President
        Gary L. Hicks                 Executive Vice President
        Robert P. Brezing             Senior Vice President
        Craig F. Fortin               Senior Vice President, Treasurer and Chief Financial Officer
        Suzanne E. Moeller            Corporate Secretary

Officers of Cornerstone Bank

        John W. Raisbeck              President and Chief Executive Officer
        John T. Heckman               Executive Vice President, Operations and Administration
        Gary L. Hicks                 Executive Vice President, Mortgage Lending
        Robert P. Brezing             Senior Vice President, Business Banking
        Craig F. Fortin               Senior Vice President, Treasurer and Chief Financial Officer
        Suzanne E. Moeller            Corporate Secretary
</TABLE>

Annual Report on Form 10-K

A copy of the Company's Annual Report on Form 10-K filed with the Securities and
Exchange  Commission will be available  without charge upon request to: Investor
Relations,  Western Ohio Financial  Corporation,  28 East Main Street,  P.O. Box
509, Springfield, Ohio 45501-0509, (937)325-9990.

Annual Meeting

The Annual Meeting of Shareholders of Western Ohio Financial Corporation will be
held at 9:00 AM on Thursday,  April 29, 1999 at the Springfield Inn, 100 South 
Fountain Avenue, Springfield, Ohio 45502.

Transfer Agent

American  Securities  Transfer and Trust,  Inc. serves as the transfer agent for
Western Ohio Financial Corporation's shares.  Communications regarding change of
address,  transfer of shares, and lost certificates  should be sent to: American
Securities  Transfer & Trust,  Inc., Suite 101, 938 Quail Street,  Lakewood,  CO
80215-5513.

<PAGE>


Legal Counsel

Local Counsel

Martin Browne Hull & Harper
1 South Limestone Street
Springfield, OH 45502

Special Counsel

Silver, Freedman & Taff, L.L.P.
1100 New York Avenue N.W.
Washington D.C. 20005

Market Makers

The Chicago Corporation
208 La Salle Street
Chicago, IL 60604
(315)855-7600

S.J. Wolfe & Co.
32 North Main Street
Suite 647
Dayton, OH 45402
(937)223-1626

Everen Securities, Inc.
77 West Wacker Dr.
Chicago, IL 60601
(312)574-6000

Sandler O'Neill & Partners, L.P.
2 World Trade Center
104th Floor
New York, NY 10048
(212)466-7744

Advest, Inc.
One Commercial Plaza
280 Trumbull Street
Hartford, CT 06103
(203)525-1421

Friedman Billings Ramsey & Co.
Potomac Tower
18th Floor
1001 19th Street North
Arlington, VA 22209
(703)312-9600

Keefe, Bruyette & Woods, Inc.
2 World Trade Center
85th Floor
New York, NY 10048
(212)323-8300


To learn more about Cornerstone Bank's services, call 1-800-600-1884

We invite you to call on Cornerstone Bank for your personal and business banking
needs.  For more information  about our various banking and financial services,
call or visit any Cornerstone Bank branch, or call 1-800-600-1884.