<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

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

                                    FORM 10-Q

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


For Quarter Ended March 31, 1998                  Commission File Number 0-24120


                       WESTERN OHIO FINANCIAL CORPORATION
             (Exact name of registrant as specified in its charter)


                DELAWARE                                        31-1403116
     ------------------------------                       ----------------------
       (State of jurisdiction of                             (I.R.S. Employer
     incorporation or organization)                       Identification Number)


 28 EAST MAIN STREET, SPRINGFIELD, OHIO                         45501-0719
----------------------------------------                        ----------
(Address of principal executive offices)                        (Zip Code)


                                 (513) 325-4683
                                 --------------
              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.


                                 YES [X] NO [ ]


As of May 5, 1998 there were 2,347,236 shares of the Registrant's common stock
issued and outstanding.
<PAGE>   2
<TABLE>
                                               INDEX


                                 WESTERN OHIO FINANCIAL CORPORATION
                                 ----------------------------------
<CAPTION>
PART I.           FINANCIAL INFORMATION                                                      Pages
-------           ---------------------                                                      -----
<S>                                                                                          <C>
Item 1.  Financial Statements:

                  Condensed Balance Sheets . . . . . . . . . . . . . . . . . . . .            3

                  Condensed Statements of Income . . . . . . . . . . . . . . . . .            4

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

                  Condensed Statements of Cash Flows . . . . . . . . . . . . . . .            6

                  Notes to Condensed Financial Statements  . . . . . . . . . . . .            7-9


Item 2.  Management's Discussion and Analysis of

                  Financial Condition and Results of Operations  . . . . . . . . .           10-14

Item 3.  Quantitative and Qualitative Disclosures About Market Risk: . . . . . . .           14


PART II.          OTHER INFORMATION
--------          -----------------

Item 4.    Submission of Matters to a Vote of Security Holders . . . . . . . . . .           15

Item 6.    Exhibits  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .           15

Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .           16
</TABLE>

                                                -2-
<PAGE>   3
<TABLE>
                                 WESTERN OHIO FINANCIAL CORPORATION
                           CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                                            (Unaudited)
<CAPTION>
                                                                       March 31,      December 31,
(Dollars in thousands)                                                   1998             1997
--------------------------------------------------------------------------------------------------
<S>                                                                    <C>              <C>     
                               ASSETS

Cash and cash equivalents                                              $ 40,604         $ 31,239
Securities available for sale, at fair value                             21,223           22,455
Mortgage-backed securities available for sale, at fair value             21,140           22,433
Loans receivable, net                                                   264,405          277,731
Real estate owned                                                            56               56
Federal Home Loan Bank stock, at cost                                     6,586            6,470
Premises and equipment, net                                               3,897            3,924
Other assets                                                              4,057            4,099
Goodwill                                                                  3,458            3,581
--------------------------------------------------------------------------------------------------

Total Assets                                                           $365,426         $371,988
==================================================================================================


                 LIABILITIES AND STOCKHOLDERS' EQUITY

Savings deposits                                                       $256,188         $246,909
Advances from the Federal Home Loan Bank of Cincinnati                   53,828           68,339
Other liabilities                                                         1,820            2,140
--------------------------------------------------------------------------------------------------

                 Total Liabilities                                      311,836          317,388
--------------------------------------------------------------------------------------------------

Stockholders' equity:
Common stock                                                                 26               26
Additional paid-in capital                                               40,469           40,458
Unrealized gain on securities available for sale,
  net of income taxes                                                       168              309
Deferred management recognition plan expense                               (355)            (396)
Unallocated shares held by employee stock ownership plan                 (1,488)          (1,547)
Treasury stock; 292,764 and 261,565 shares at cost respectively          (6,284)          (5,448)
Retained earnings (substantially restricted)                             21,054           21,198
--------------------------------------------------------------------------------------------------

                 Total Stockholders' Equity                              53,590           54,600
--------------------------------------------------------------------------------------------------

Total Liabilities and Stockholders' Equity                             $365,426         $371,988
==================================================================================================
</TABLE>
See Notes to Consolidated Financial Statements.

                                      -3-
<PAGE>   4
                       WESTERN OHIO FINANCIAL CORPORATION
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)


                                                         For the Quarter Ended
                                                                March 31,
(Dollars in thousands except per share amounts)           1998            1997
-------------------------------------------------------------------------------
Interest Income:
  Interest and fees on loans                            $ 5,437         $ 5,696
  Interest and dividends on investment securities           787             691
  Interest on mortgage-backed securities                    367             602
  Other interest income                                     149             125
-------------------------------------------------------------------------------

    Total interest income                                 6,740           7,114
-------------------------------------------------------------------------------

Interest expense:
  Interest on deposits                                    3,183           2,936
  Interest on borrowings                                    972           1,495
-------------------------------------------------------------------------------

    Total Interest expense                                4,155           4,431
-------------------------------------------------------------------------------

Net interest income                                       2,585           2,683
Provision for losses on loans and securities                 --              67

Net Interest income after provision for losses            2,585           2,616

Gain on sale of investments                                 173              41

Other income                                                220             226

Other expense                                            (2,262)         (2,323)
-------------------------------------------------------------------------------

    Income before income tax expense                        716             560

Income tax expense                                          281             228
-------------------------------------------------------------------------------

  Net Income                                            $   435         $   332
===============================================================================
Fully diluted earnings per common
  and common equivalent share                           $  0.19         $  0.14
===============================================================================
See Notes to Consolidated Financial Statements 

                                      -4-
<PAGE>   5
                       WESTERN OHIO FINANCIAL CORPORATION
                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                                   (Unaudited)


                                                         For the quarter ended
                                                                March 31,
(Dollars in thousands)                                     1998          1997
------------------------------------------------------------------------------

Net income                                                $ 435         $ 332
Other comprehensive income, net of tax:
Unrealized gains / (losses) arising during period            32          (433)
Less:  reclassification adjustment for accumulated
  gains/losses included in net income                      (173)          (41)
------------------------------------------------------------------------------

Other comprehensive income                                 (141)         (474)
------------------------------------------------------------------------------

Comprehensive income                                      $ 294         $(142)
==============================================================================

                                      -5-
<PAGE>   6
<TABLE>
                                 WESTERN OHIO FINANCIAL CORPORATION
                               CONSOLIDATED STATEMENTS OF CASH FLOWS
                                            (Unaudited)
<CAPTION>
                                                                           For the Quarter Ended
                                                                                 March 31,
(Dollars in thousands except per share amounts)                            1998             1997
--------------------------------------------------------------------------------------------------
<S>                                                                      <C>              <C>      
Cash flows from operating activities                                     $    868         $   (312)
--------------------------------------------------------------------------------------------------

  Federal Home Loan Bank Stock:  Purchases                                     --              (25)
  Loans:
    Originations                                                           (8,002)         (19,403)
    Collections                                                            21,289            9,325
    Sales                                                                      --            1,110
  Mortgage-backed securities:
    Collections                                                             1,293              934
  Investment securities:
    Purchases                                                                  --           (1,001)
    Maturities                                                              1,000            1,300
    Sales                                                                     151               --
  Property and equipment:
    Additions                                                                 (56)            (163)
    Sale proceeds                                                              --              158
--------------------------------------------------------------------------------------------------

        Net cash provided by investing activities                          15,675           (7,765)
--------------------------------------------------------------------------------------------------

Cash flows from financing activities:
  Net increase (decrease) in savings deposits                               9,286            5,249
  Net decrease in advances from borrowers for taxes and insurance            (486)            (194)
  Dividends paid                                                             (603)            (580)
  Advances from Federal Home Loan Bank:
    Net borrowings                                                             --           10,600
    Repayments                                                            (14,512)          (6,921)
  Stock options, net                                                          (27)             163
  Treasury stock repurchase                                                  (836)              --
--------------------------------------------------------------------------------------------------

        Net cash provided (used) by financing activities                   (7,178)           8,317
--------------------------------------------------------------------------------------------------

Net Increase (decrease) in cash and cash equivalents                        9,365              240

Cash and cash equivalents:
  Beginning                                                                31,239           15,611
--------------------------------------------------------------------------------------------------

  Ending                                                                 $ 40,604         $ 15,851
==================================================================================================
</TABLE>
See Notes to Consolidated Financial Statements 

                                      -6-
<PAGE>   7
                       WESTERN OHIO FINANCIAL CORPORATION

              Notes to Condensed Consolidated Financial Statements

1.       Principles of consolidation:
         ----------------------------

         The financial statements for 1998 are presented for Western Ohio
         Financial Corporation ("the Company") and its wholly-owned subsidiary,
         Cornerstone Bank ("Cornerstone"), a combination of the former
         Springfield Federal Savings Bank ("Springfield"), Mayflower Federal
         Savings Bank ("Mayflower"), and Seven Hills Savings Association ("Seven
         Hills"). The statements of financial condition for the three months
         ended March 31, 1998, are for the Company and Cornerstone. The
         statements of income for the three months ended March 31, 1998 and
         1997, are for the Company and Cornerstone ("formerly Springfield,
         Mayflower and Seven Hills").

2.       Basis of presentation:
         ----------------------

         The accompanying unaudited condensed financial statements have been
         prepared in accordance with generally accepted accounting principles
         for interim financial reporting and with the instructions to Form 10-Q
         and Article 10 of Regulation S-X. Accordingly, they do not include all
         of the information and footnotes required by generally accepted
         accounting principles for complete financial statements. In the opinion
         of management, all adjustments (consisting of normal recurring
         accruals) considered necessary for a fair presentation have been
         included. These unaudited condensed financial statements should be read
         in conjunction with the financial statements and notes thereto included
         in the Company's annual report on Form 10-K for the year ended December
         31, 1997. The financial data and results of operations for periods
         presented may not necessarily reflect the results to be anticipated for
         the entire year.

3.       Earnings per common and common equivalent share:
         ------------------------------------------------

         Basic earnings per share are computed by dividing income available to
         common shareholders by the weighted-average number of common shares
         outstanding for the period. Diluted earnings per share are computed by
         dividing income available to common shareholders by the potential
         dilution of securities that could share in earnings such as stock
         options, warrants or other similar items. The basic weighted average
         number of common shares outstanding during the three month period ended
         March 31, 1998 and March 31, 1997 were 2,273,965 and 2,199,435
         respectively. The diluted weighted average number of common shares
         giving effect to options outstanding during the three month period
         ended March 31, 1998 and March 31, 1997 were 2,334,542 and 2,241,093
         respectively.

4.       Recent accounting pronouncements
         --------------------------------

         Statement of Financial Accounting Standards ("SFAS") No. 125,
         Accounting for Transfers and Servicing of Financial Assets and
         Extinquishments of Liabilities, was adopted by the Company in 1997.
         SFAS No. 125 revises the accounting for transfers of financial assets
         such as loans and securities, and for distinguishing between sales and
         secured borrowings. The adoption of the portions of SFAS No. 125
         relating to securities lending, repurchase agreements and other similar
         transactions are not required to be adopted until 1998. SFAS No. 125
         did not have a material impact on the Bank's financial statements, nor
         are the portions to be adopted in 1998 expected to materially impact
         the financial statements.

         SFAS No. 128, Earnings Per Share, became effective for the Company in
         1997. SFAS No. 128 requires dual presentation of basic and diluted
         earnings per share ("EPS") for entities with complex capital
         structures. Basic EPS includes no dilution and is computed by dividing
         income available to common shareholders by weighted average common
         shares outstanding for the period. Diluted EPS reflects the potential
         dilution of securities that could share in earnings such as stock
         options, warrants or other similar items.

                                      -7-
<PAGE>   8
        SFAS No. 129, Disclosures of Information about Capital Structure,
        consolidated existing accounting guidance relation to disclosure about a
        Company's capital structure. Public companies generally have always been
        required to make disclosures now required by SFAS No. 129 and,
        therefore, SFAS No. 129 did not impact the Company's disclosures.

        SFAS No. 130, Reporting Comprehensive Income, establishes standards for
        reporting and display of comprehensive income and its components
        (revenues, expenses, gains and losses) in a full set of general-purpose
        financial statements. SFAS No. 130 is effective for the Company in 1998.
        Reclassification of financial statements for earlier periods provided
        for comparative purposes is required.

        SFAS No. 131, Disclosures about Segments of an Enterprise and Related
        Information, changes the way public business enterprises report
        information about operating segments in annual financial statements and
        requires those enterprises to report selected information about
        reportable segments in interim financial reports issued to shareholders.
        It also establishes standards for related disclosures about products and
        services, geographic areas and major customers. SFAS No. 131 becomes
        effective for the Company in 1998.

                                      -8-
<PAGE>   9
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

         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.

         Forward-Looking Statements, When used in this filing and in future
filings by the Company with the Securities and Exchange Commission, in the
Company's press releases or other public or shareholder communications, or in
oral statements made with the approval of an authorized executive officer, the
words or phrases "would be," "will allow," "intends to," "will likely result,"
"are expected to," "will continue," "is anticipated," "estimate," "project" 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 risks and uncertainties, including but not limited to
changes in economic conditions in the Company's market area, changes in policies
by regulatory agencies, fluctuations in interest rates, demand for loans in the
Company's market area and competition, all or some of which could cause actual
results to differ materially from historical earnings and those presently
anticipated or projected. The Company wishes to caution readers not to place
undue reliance on any such forward-looking statements, which speak only as of
the date made, and advises readers that various factors, including regional and
national economic conditions, substantial changes in levels of market interest
rates, credit and other risks of lending and investment activities and
competitive and regulatory factors, could affect the Company's financial
performance and could cause the Company's actual results for future periods to
differ materially from those anticipated or projected.

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

         Impact of the Year 2000, The Company has conducted a comprehensive
review of its computer systems to identify applications that could be affected
by the "Year 2000" issue, and has developed an implementation plan to address
the issue. The Company's data processing is performed primarily by a third-party
service bureau with part of its processing being performed in-house; however
software and hardware utilized are under maintenance agreements with third-party
vendors, consequently the Company is very dependent on those vendors to conduct
its business. The Company has already contacted each vendor to request time
tables for year 2000 compliance and expected costs, if any, to be passed along
to the Company. To date, the Company has been informed that its primary service
providers anticipate that all reprogramming efforts will be completed by
December 31, 1998, allowing the Company adequate time for testing. Certain other
vendors have not yet responded, however. The Company will pursue other options
if it appears that these vendors will be unable to comply. Management does not
expect these costs to have a significant impact on its financial position or
results of operations. However, there can be no assurance that the vendors
systems will be 2000 compliant. Consequently the Company could incur incremental
costs to convert to another vendor. The Company has identified certain of its
hardware and software equipment that will not be Year 2000 compliant and intends
to purchase new equipment and software prior to December 31, 1998. These capital
expenditures are expected to total approximately $185,000.

FINANCIAL CONDITION
-------------------

         Western Ohio Financial Corporation ("the Company") is the holding
company of Cornerstone Bank formerly Springfield Federal Savings Bank, Mayflower
Federal Savings Bank, and Seven Hills Savings Association. Consolidated assets
of the Company totaled $365.4 million at March 31, 1998, a decrease of $6.6
million from the December 31, 1997, total of $372.0 million. The decrease in
assets is primarily the

                                      -9-
<PAGE>   10
result of a decrease of $13.3 million in loans receivable offset by an increase
of $9.4 million in cash and cash equivalents. Liabilities decreased $5.6 million
primarily due to a decrease in Federal Home Loan Bank advances of $14.5 million
offset by an increase in savings deposits of $9.3 million.

         Loans receivable decreased $13.3 million during the three months ended
March 31, 1998, decreasing from $277.7 million as of December 31, 1997 to $264.4
million on March 31, 1998. This decrease is in response to management's decision
to place greater emphasis on selling one-to-four family loans in the secondary
market. Management made the decision to emphasize selling loan production due to
its anticipation of a flat interest rate yield curve in 1998. Management
believes that interest margins are too small to justify placing the product in
portfolio at this time. Management believes that it can achieve greater returns
through secondary market sales on a servicing released basis.

         In December 1997, the Company established an additional provision for
loan losses of $2.3 million. Management identified potential 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 allowance of $3.9 million is adequate given the area economic
conditions and its loan portfolio composition. The Company reviewed its
allowance for loan losses as of March 31, 1998, and believes that no further
allowances are necessary. In addition, the Company is aware of no regulatory
directives or suggestions that the Company make additional provisions for losses
on loans.

         Cash and cash equivalents increased by $9.4 million to $40.6 million on
March 31, 1998, from $31.2 million on December 31, 1997. Cash and cash
equivalents consist of cash, checking deposits and federal funds deposited at
other financial institutions.

         Investment securities available for sale decreased $1.2 million or 5.4%
from $22.4 million at December 31, 1997, to $21.2 million on March 31, 1998. The
decrease is the result of principal repayments in addition to the sale of a
$134,000 investment.

         The Company's mortgage-backed securities available for sale decreased
by $1.3 million or 5.8% from $22.4 million on December 31, 1997, to $21.1 on
March 31, 1998. This was due to principal repayments on existing mortgage-backed
securities available for sale. A portion of these securities is often referred
to as derivatives. The derivative securities are all adjustable rate in nature
and were not "high risk" securities under the criteria set forth by the Federal
Financial Institutions Examination Council ("FFIEC").

         The investment in the stock of the Federal Home Loan Bank of Cincinnati
increased by $116,000 from $6.5 million at December 31, 1997, to $6.6 million at
March 31, 1998. The increase is due primarily to the stock dividends paid by the
Federal Home Loan Bank. This investment is dictated by Cornerstone's membership
in the Federal Home Loan Bank and is a factor of the institution's borrowings
and total assets. Currently, dividends on such stock are paid primarily in the
form of additional shares of stock.

         Other assets decreased by $42,000 over the three months ended March 31,
1998, primarily due to the decrease in prepaid expenses.

         Deposits increased by $9.3 million during the three months ended March
31, 1998. This increase is generally due to Cornerstone's aggressive attempt to
increase deposits, especially in its checking account base.

         Advances from the Federal Home Loan Bank of Cincinnati decreased by
$14.5 million or 21.2% as the result of repayment of borrowings. The repayment
of the borrowings was a result of the decrease in net loans receivable in the
first quarter of 1998. The advances are fixed rate advances utilized by
Cornerstone.

         Other liabilities decreased $320,000 from $2.1 million on December 31,
1997, to $1.8 million on March 31, 1998. This decrease is due to a decrease in
escrow holdings as the first half 1997 property taxes were paid in the first
quarter of 1998. The decrease in escrow holdings was partially offset by an
increase in the federal income tax liability the payment for which was not due
until April 15, 1998.

                                      -10-
<PAGE>   11
         Total stockholders' equity decreased $1.0 million from $54.6 million at
December 31, 1997, to $53.6 million at March 31, 1998. This decline is primarily
due to an increase in treasury stock repurchases.

         As of March 31, 1998, the Company had commitments to make $.4 million
of residential loans and no nonresidential mortgage loans. It is expected that
these loans will be funded within 30 days. The Company also had $1.1 million in
commitments to fund loans on residential properties under construction. These
commitments are anticipated to be filled within three to six months. Unused
commercial lines of credit were $0.8 million and unused home equity lines of
credit were $5.4 million. Commitments to originate nonmortgage loans totaled
$0.1 million.

                                      -11-
<PAGE>   12
CAPITAL RESOURCES AND LIQUIDITY OF CORNERSTONE BANK
---------------------------------------------------

         The Office of Thrift Supervision (OTS) has three minimum regulatory
capital standards. During the three months ended March 31, 1998, the Bank
continued to comply with all three requirements. The following is a summary of
the Bank's approximate regulatory capital position, in dollars (millions) and as
a percentage of regulatory assets, at March 31, 1998.

                          Actual            Required           Excess
                      -------------      -------------     --------------
Tangible Capital      $42.5    11.8%     $ 5.4    1.5%     $37.1    10.3%
Core Capital          $42.5    11.8%     $14.6    4.0%     $27.9     7.8%
Risk-Based Capital    $44.9    22.2%     $16.1    8.0%     $28.8    14.2%

         Federal regulations require the Bank to maintain an average daily
balance of liquid assets 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 for the preceding calendar quarter. This regulation changed in December
1997 by modifying the requirement to be 4% instead of 5% for overall liquidity
and eliminating the short term requirement of 1%. In addition, the regulation
now allows for mortgage-backed and other securities to be included as part of
liquid assets without any term limitation. Liquidity is measured by cash and
certain investments that are not committed, pledged, or required to liquidate
specific liabilities. The following is a summary of Cornerstone's regulatory
liquidity ratio.


                   March 31,      December 31,     September 30,    June 30,
                     1998             1997             1997           1997
                     ----             ----             ----           ----
Liquid Assets        26.4%            23.0%            5.7%           5.1%


         The above tables pertain only to Cornerstone. The resources of the
Company are not considered in meeting the above requirements.

                                      -12-
<PAGE>   13
RESULTS OF OPERATIONS
---------------------


General
-------

         For the three months ended March 31, 1998, net income increased by
$103,000 compared to the three months ended March 31, 1997. The largest factor
in the increase was a sale of Federal Home Loan Mortgage Corporation stock which
had been held available for sale.

Interest Income
---------------

         For the three months ended March 31, 1998, interest income decreased by
$374,000 compared to the three months ended March 31, 1997, from $7.1 million to
$6.7 million. Interest and fees on loans decreased by $259,000 for the three
months ended March 31, 1998, compared to the three months ended March 31, 1997.
This is due primarily to the decline in total outstanding loans receivable.
Interest and dividends on investment securities increased $96,000 during the
three months ended March 31, 1998, over the three months ended March 31, 1997
due to an increase in federal funds held. Interest on mortgage backed securities
decreased $235,000 mostly as a result of repayments. Other interest income
increased modestly by $24,000 as more dividend income was earned on Federal Home
Loan Bank stock.

Interest Expense
----------------

         Interest expense decreased by $276,000, from $4.4 million for the three
months ended March 31, 1997, as compared to $4.1 million for the three months
ended March 31, 1998. The decrease was primarily due to the decrease in the
level of borrowing from the Federal Home Loan Bank. Funds from the repayment of
loans were used to repay the amount owed to the Federal Home Loan Bank.
Management has aggressively marketed its deposit programs using the funds to
repay Federal Home Loan Bank Advances. The interest on borrowings decreased
$523,000 from $1.5 million for the three months ended March 31, 1997, to $1.0
million for the three months ended March 31, 1998. These borrowings were fixed
rate in nature.

Net Interest Income
-------------------

         Net interest income decreased $98,000 to $2.6 million for the three
months ended March 31, 1998, as compared to $2.7 million for the three months
ended March 31, 1997. This is primarily due to the decline in total outstanding
loans receivable. In addition, the repayment of Federal Home Loan Bank advances
and the increase in deposits contribute to the change in the interest
composition affecting net interest income.

Allowance for Loan and Lease Losses
-----------------------------------

         There was no additional amount added to the provision for loan and
lease losses during the first three months of 1998. As discussed in the
financial condition section, management believes that the fourth quarter 1997
addition to the allowance provides an adequate allowance based upon the
portfolio composition and levels of classified assets.

Gain on Sale of Investments
---------------------------

         There was a $148,000 gain on sale of Federal Home Loan Mortgage
Corporation stock and a $25,000 gain on the sale of loans during the three month
period ended March 31, 1998. There was a $41,000 gain on the sale of loans in
the period ending March 31, 1997.

Other Income
------------

         Other income increased from $226,000 for the three months ended March
31, 1997, to $245,000 for the three months ended March 31, 1998. This increase
is related to increased efforts to generate service

                                      -13-
<PAGE>   14
fees by Cornerstone with its checking account program. Management is actively
taking steps to increase this area of income generation.

Other Expense
-------------

         Total other expense decreased by $61,000, from $2.3 million for the
three month period ended March 31, 1997, compared to $2.2 million for the three
month period ended March 31, 1998. This is due in part to a reduction in the
franchise tax payable at the parent level as well as a reduction in operating
expenses due to the conversion of Mayflower and Seven Hills into Cornerstone in
August 1997.

Income Tax Expense
------------------

         Income tax expense increased $53,000 in the period ended March 31,
1998, as a result of changes in earnings before taxes.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
----------------------------------------------------------

         There have been no material changes in the quantitative and qualitative
disclosures about market risks as of March 31, 1998 from that presented in the
Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1997.

                                      -14-
<PAGE>   15
                                     PART II
                                     -------

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

         a)       On April 28, 1998, the Company held its Annual Meeting of
                  Stockholders.

         b)       At the meeting, David L. Dillahunt, Howard V. Dodds, and John
                  W. Raisbeck were elected as directors for terms to expire in
                  2001.

         c)       Stockholders voted on the following matters:

                  (i)      The election of the following three directors of the
                           Company;

<TABLE>
<CAPTION>
                                                                                      Broker
                   Votes:                    For       Vote Withheld    Abstain    Non-Votes
                   ------                    ---       -------------    -------    ---------
<S>                                       <C>              <C>             <C>         <C>
                   David L. Dillahunt     2,134,919        57,801          --          --

                   Howard V. Dodds        2,130,401        62,319          --          --

                   John W. Raisbeck       2,133,140        59,580          --          --
</TABLE>


                  (ii)     The approval of the 1998 Omnibus Incentive Plan;

<TABLE>
<CAPTION>
                                                                                      Broker
                   Votes:                    For       Vote Withheld    Abstain    Non-Votes
                   ------                    ---       -------------    -------    ---------
<S>                                       <C>             <C>            <C>        <C>    
                                          1,305,505       292,381        52,257     536,327
</TABLE>
                and

                  (iii)    The approval of the 1998 Omnibus Incentive Plan;

<TABLE>
<CAPTION>
                   Votes:                    For          Against       Abstain    Non-Votes
                   ------                    ---          -------       -------    ---------
<S>                                       <C>              <C>           <C>             
                                          2,138,753        32,768        14,949        --
</TABLE>

Item 6.  Exhibits
-----------------

         b)       8-K dated February 5, 1998.
                  8-K dated February 19, 1998.
                  8-K dated February 20, 1998.

                                      -15-
<PAGE>   16
                                   SIGNATURES


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

                                    WESTERN OHIO FINANCIAL CORPORATION
                                    Registrant

Date:
      ---------------------         --------------------------------------------
                                    John W. Raisbeck, President
                                    and Chief Executive Officer
                                    (Duly Authorized Officer)


Date:
      ---------------------         --------------------------------------------
                                    Thomas A. Estep, Vice President,
                                    Treasurer and Chief Financial Officer
                                    (Principal Financial and Accounting Officer)

                                      -16-