UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                                   FORM 10-K/A
               [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                            for the fiscal year ended
                                December 31, 2004
                                       OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934
           For the transition period from ____________ to ___________

                         Commission file number 0-16023

                            UNIVERSITY BANCORP, INC.
             (Exact name of registrant as specified in its charter)
         Delaware                                        38-2929531
------------------------------------            ---------------------------
(State or other jurisdiction of                (I.R.S. Employer incorporation)
         Identification No.

959 Maiden Lane, Ann Arbor, Michigan                    48105
------------------------------------                 ---------
(Address of principal executive offices)             (Zip Code)

Registrant's telephone number, including area code (734) 741-5858
                                                   --------------

Securities registered pursuant to section 12(b) of the Act: NONE Securities
registered pursuant to section 12(g) of the Act:
         Common Stock, par value $.010 per share

     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
              ---       ---

     Indicate by check mark if disclosure of delinquent  filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of  registrant's  knowledge,  in  definitive  proxy  or  other  information
statements  incorporated  by  reference  in Part  III of this  Form  10-K or any
amendment to this Form 10-K. [X]

     Indicate by check mark whether the registrant is an  accelerated  filer (as
defined in Exchange Act Rule 12b-2). Yes ___ No _X___

     The number of shares outstanding of the Registrant's Common Stock as of
March 7 2005: 4,143,878 shares. The aggregate market value of the voting stock
held by non-affiliates of the Registrant based on $1.46 per share, the closing
price for the Registrant's Common Stock on June 30, 2004, as reported by NASDAQ,
was approximately $1,681,311.

* For purposes of this calculation shares of the Registrant held by directors
and officers of the Registrant and by other affiliates have been excluded.




<PAGE>


                            University Bancorp, Inc.
                                  FORM 10-K/A
                      For the year ended December 31, 2004

EXPLANATORY NOTE

This Amendment on Form 10-K/A (this Amendment) amends the Annual Report on Form
10-K for the year ended December 31, 2004, as originally filed by University
Bancorp, Inc. on April 15, 2005 (the Original Filing), for the purpose of:

1.      Clearly stating that the disclosure controls and procedures discussed in
        Item 9A Controls and Procedures are effective;
2.      Defining the disclosure controls and procedures as set forth by Rule
        13a-15e; 3. Revising the other auditors reports in Exhibit 23.1 to cover
        the three year
        period ended December 31, 2004; and
4.      Revising the other auditors report to conform to the Public Company
        Accounting Oversight Board standards.

In addition, in connection with the filing of this Amendment and pursuant to the
rules of the Securities and Exchange Commission, we are including with this
Amendment certain currently dated certifications. Additionally, the financial
statements, as originally filed, are included in this filing.

Except as described above, no other changes have been made to the Original
Filing. This Amendment continues to speak as of the date of the Original Filing,
and we have not updated the disclosures contained in this Amendment to reflect
any events that occurred at a date subsequent to the filing of the Original
Filing. The filing of this Form 10-K/A is not a representation that any
statements contained in items of the Original Filing other than that information
being amended are true or complete as of any date subsequent to the date of the
Original Filing. The filing of this Form 10-K/A shall not be deemed an admission
that the original filing or the amendments made thereto, when made, included any
untrue statement of a material fact or omitted to state a material fact
necessary to make a statement not misleading.

<PAGE>



Item 8. - Financial Statements and Supplementary Data

















                            UNIVERSITY BANCORP, INC.

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

                        CONSOLIDATED FINANCIAL STATEMENTS

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

                          DECEMBER 31, 2004, 2003 2002


<PAGE>





             Report of Independent Registered Public Accounting Firm


Board of Directors and Stockholder
University Bancorp, Inc.

We have audited the accompanying consolidated balance sheet of University
Bancorp, Inc. and subsidiaries as of December 31, 2004 and 2003, and the related
consolidated statements of operations, comprehensive income (loss),
stockholders' equity, and cash flows for each of the three years ended December
31, 2004. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits. We did not audit the financial statements of
Midwest Loan Services, Inc., an eighty percent owned subsidiary, which
statements reflect total assets of 5.2 percent and 5.4 percent as of December
31, 2004 and 2003, respectively, and total revenues of 44.7 percent, 48.7
percent and 39.9 percent, respectively, for each of the three years ended
December 31, 2004. Those statements were audited by other auditors, whose report
thereon has been furnished to us, and our opinion, insofar as it relates to the
amounts included for Midwest Loan Services, Inc., is based solely on the report
of the other auditors.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the
financial statements are free of material misstatement. The Company is not
required to have, nor were we engaged to perform an audit of its internal
control over financial reporting. Our audits included procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.

In our opinion, based on our audits and the report of the other auditors the
consolidated financial statements referred to above present fairly, in all
material respects, the financial position of University Bancorp, Inc. and
subsidiaries as of December 31, 2004 and 2003, and the results of their
operations and their cash flows for the each of the three years ended December
31, 2004 in conformity with accounting principles generally accepted in the
United States of America.


/S/ GRANT THORNTON LLP


Southfield, Michigan
March 29, 2005

<PAGE>
<TABLE>
<CAPTION>


                                                           UNIVERSITY BANCORP, INC.
                                                         Consolidated Balance Sheets
                                                          December 31, 2004 and 2003

                                                                               December 31,          December 31,
ASSETS                                                                            2004                   2003
                                                                               -------------          -------------
<S>                                                                            <C>                  <C>
Cash and due from banks                                                        $  1,731,569         $  2,171,189
Securities available for sale, at market                                          1,106,607            1,649,169
Federal Home Loan Bank Stock                                                        921,700              881,100
Loans held for sale, at the lower of cost or market                                 846,400              206,008
Loans                                                                            42,999,800           34,928,586
Allowance for loan losses                                                         (353,124)            (454,118)
                                                                               --------------       -------------
     Loans, net                                                                  42,646,676           34,474,468

Premises and equipment, net                                                         946,704              829,807
Investment in Michigan BIDCO Inc.                                                         0              629,258
Investment in Michigan Capital Fund LPI                                                   0              256,244
Mortgage servicing rights, net                                                    1,097,786            1,031,575
Real estate owned, net                                                              534,043              429,500
Accounts receivable                                                                  30,949              122,067
Accrued interest receivable                                                         148,344              129,808
Prepaid expenses                                                                    250,249              183,143
Goodwill                                                                            103,914              103,914
Other assets                                                                        420,757              451,290
                                                                               -------------        -------------
      TOTAL ASSETS                                                             $ 50,785,698         $ 43,548,540
                                                                               ============         =============

                                                                     -Continued-
</TABLE>


<PAGE>


<TABLE>
<CAPTION>


                                                           UNIVERSITY BANCORP, INC.
                                                   Consolidated Balance Sheets (continued)
                                                          December 31, 2004 and 2003

                                                                               December 31,          December 31,
LIABILITIES AND STOCKHOLDERS' EQUITY                                               2004                  2003
                                                                               -------------        -------------
Liabilities:
Deposits:
<S>                                                                            <C>                  <C>
  Demand - non interest bearing                                                $  3,047,397         $  3,146,688
  Demand - interest bearing                                                      28,600,355           25,827,337
  Savings                                                                           499,865              377,545
  Time                                                                           12,440,182            9,455,982
                                                                               ------------         -------------
     Total Deposits                                                              44,587,799           38,807,552
Short term borrowings                                                             2,416,000                    0
Long term borrowings                                                                 34,000              166,000
Accounts payable                                                                    115,230              289,150
Accrued interest payable                                                             50,296               51,613
Other liabilities                                                                   140,629              354,273
                                                                               ------------         -------------
     Total Liabilities                                                           47,343,954           39,668,588
Minority Interest                                                                   440,118              445,324
Stockholders' equity:
  Preferred stock, $0.001 par value;
    $1,000  liquidation value;
    Authorized - 500,000 shares;                                    -
  Common stock, $0.01 par value;
    Authorized - 5,000,000 shares;
    Issued - 4,240,641 shares in 2004 and
         4,141,732 shares in 2003                                                    42,406               41,417
  Additional paid-in-capital                                                      5,841,331            5,677,940
  Accumulated deficit                                                           (2,490,224)          (1,905,404)
  Treasury stock - 115,184 shares in 2004
    and 2003                                                                      (340,530)            (340,530)
  Accumulated other comprehensive loss,
    unrealized losses on securities
    available for sale, net                                                        (51,357)              (38,795)
                                                                               -------------        -------------
     Total Stockholders' Equity                                                   3,001,626            3,434,628
                                                                               -------------        -------------
     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                $ 50,785,698         $ 43,548,540
                                                                               ==============       =============
The accompanying notes are an integral part of the consolidated financial
statements.
</TABLE>


<PAGE>

<TABLE>
<CAPTION>



                                         UNIVERSITY BANCORP, INC.
                                  Consolidated Statements of Operations
                           For the Years Ended December 31, 2004, 2003 and 2002

                                                           2004             2003               2002
                                                     ----------------- ---------------- -------------------
Interest income:

<S>                                                      <C>               <C>                <C>
  Interest and fees on loans                              $ 2,635,557      $ 2,554,510        $ 2,805,704
  Interest on securities:
   U.S. Government and agencies                                48,064           81,269            270,127
   Other securities                                            56,924           84,302             96,666
   Other interest income                                        3,726           12,018             21,955
                                                    ------------------ ---------------- ------------------
     Total interest income                                  2,744,271        2,732,099          3,194,452
                                                    ------------------ ---------------- ------------------
Interest expense:
  Interest on deposits:
   Demand deposits                                            428,611          400,994            330,178
   Savings deposits                                             4,758            4,634              4,825
   Time certificates of deposit                               328,683          420,932            671,929
  Short term borrowings                                        16,999            2,933             11,556
  Long term borrowings                                          4,907           12,144             20,675
                                                    ------------------ ---------------- ------------------
     Total interest expense                                   783,958          841,637          1,039,163
                                                    ------------------ ---------------- ------------------
     Net interest income                                    1,960,313        1,890,462          2,155,289
(Credit) provision for loan losses                           (87,500)          189,400            100,000
                                                    ------------------ ---------------- ------------------
     Net interest income after
      (credit)  provision for loan
      losses                                                2,047,813        1,701,062          2,055,289
                                                    ------------------ ---------------- ------------------
Other income:
   Loan servicing and subservicing
      fees                                                  1,409,283        1,128,293            713,427
  Initial loan set-up and other fees                        1,550,620        3,382,955          3,090,838
  Gain on sale of mortgage loans                              340,149          756,170            236,098
  Insurance & investment fee income                           219,631          168,577            113,870
  Deposit service charges and fees                            112,163          110,608             92,955
  Net security (losses)gains                                    (446)         (54,011)             69,733
  Gain on the sale and leaseback of
   premises                                                   184,873          217,053                  -
  Other                                                         6,275          222,847            124,098
                                                    ------------------ ---------------- ------------------
     Total other income                                     3,822,548        5,932,492          4,441,019
                                                    ------------------ ---------------- ------------------
                   -Continued-
</TABLE>



<PAGE>


<TABLE>
<CAPTION>



                                       UNIVERSITY BANCORP, INC.
                           Consolidated Statements of Operations (continued)
                         For the Years Ended December 31, 2004, 2003 and 2002

                                                          2004              2003              2002
                                                    ------------------ ---------------- ------------------
Other expenses:
<S>                                                       <C>              <C>                <C>
  Salaries and benefits                                   $ 2,866,849      $ 3,358,060        $ 2,929,540
  Occupancy, net                                              415,156          422,767            349,186
  Data processing and equipment                               569,297          487,701            433,239
  Legal and audit expense                                     217,414          202,865            173,139
  Consulting fees                                             137,569          173,132            181,545
  Mortgage banking expense                                    246,346          710,907            579,040
  Servicing rights amortization                               448,553          871,175            529,048
  Advertising                                                 145,592          142,996             92,944
  Memberships and training                                    132,467          118,581            103,095
  Travel and entertainment                                    103,875          121,631             91,330
  Supplies and postage                                        207,141          244,615            199,338
  Insurance                                                   134,163           89,532             87,662
  Other operating expenses                                    750,759          675,150            541,604
                                                    ------------------ ---------------- ------------------
     Total other expenses                                   6,375,181        7,619,112          6,290,710
                                                    ------------------ ---------------- ------------------
(Loss)income before income taxes                            (504,820)           14,442            205,598
Income tax expense(benefit)                                    80,000         (80,000)                  0
                                                    ------------------------------------------------------
     Net (loss)income                                     $ (584,820)      $    94,442        $   205,598
Basic and diluted (loss)income per common share           $    (0.14)      $      0.02        $      0.05
                                                    ================== ================ ==================
Weighted average shares outstanding -Basic                  4,085,244        3,940,433          3,859,433
Weighted average shares outstanding -Diluted                4,085,244        4,074,415          4,058,342

The accompanying notes are an integral part of the consolidated financial
statements.
</TABLE>

<PAGE>




<TABLE>
<CAPTION>


                                                UNIVERSITY BANCORP, INC.
                                  Consolidated Statements of Comprehensive (Loss)Income
                                  For the Years Ended December 31, 2004, 2003 and 2002

                                                               2004                   2003                    2002
                                                        --------------------    ------------------      ------------------
<S>                                                              <C>                      <C>                    <C>
Net (loss) income                                                $(584,820)              $ 94,442                $205,598
Other comprehensive (loss)income:
   Unrealized (losses) gains on
    securities available for sale                                  (13,008)              (11,042)                 155,081
   Less:  reclassification
    adjustment for accumulated
   (Losses) gains included in net
    (Loss) income                                                     (446)              (54,011)                  69,733
                                                        --------------------    ------------------      ------------------
                                                                   (12,562)                42,969                  85,348
                                                        --------------------    ------------------      ------------------
Comprehensive (loss)income                                       $(597,382)              $137,411                $290,946
                                                        ====================    ==================      ==================


 The accompanying notes are an integral part of the consolidated financial
statements.
</TABLE>



<PAGE>

<TABLE>
<CAPTION>


                                               UNIVERSITY BANCORP, INC.
                                    Consolidated Statements of Stockholders'
                                Equity For the years ended December 31, 2004,
                                2003, and 2002


                                      Common Stock $.01                 Treasury Stock                   Accumulated
                                        Par Value           Additional                       Retained       Other        Total
                                      Number of   Par        Paid In    Number of             Earnings   Comprehensive Stockholders'
                                       Shares     Value      Capital    Shares     Cost        (Deficit)      Loss       Equity
                                      ---------------------------------------------------------------------------------------------

<S>             <C>                    <C>        <C>      <C>         <C>         <C>        <C>            <C>         <C>
Balance January 1, 2002                3,867,732  $38,677  $5,411,018  (115,184)   $(340,530) $(2,205,444)   $(167,112)  $2,736,609
Issuance of common stock at
 weighted average price of
 $1.00 per share, net of
 expenses of $18,587                     147,000    1,470     126,943                                                       128,413
Decrease in unrealized loss on
 securities available for
 sale, net of tax                                                                                               85,348       85,348
Net lncome                                                                                        205,598                   205,598
                                       ---------------------------------------------------------------------------------------------
December 31, 2002                       4,014,732  40,147   5,537,961    (115,184)  (340,530)  (1,999,846)     (81,764)   3,155,968
                                       ---------------------------------------------------------------------------------------------
Issuance of common stock at
 weighted average price of
 $1.11 per share, net of
 expenses of $0.00                        127,000   1,270     139,980                                                       141,250
Decrease in unrealized loss on
 securities available for
 sale, net of tax                                                                                              42,969        42,969
Net Income                                                                                          94,442                   94,442
                                       ---------------------------------------------------------------------------------------------
December 31, 2003                       4,141,732   41,417  5,677,940    (115,184)  (340,530)   (1,905,404)    (38,795)   3,434,629
                                       ---------------------------------------------------------------------------------------------
Issuance of common stock at
 weighted average price of
 $1.58 per share, net of
expenses of $0.00                        103,909     989     163,391                                                         164,380

Decrease in unrealized loss
 on securities available for
 sale, net of tax                                                                                             (12,562)      (12,562)
Net Loss                                                                                         (584,820)                 (542,820)
                                       ---------------------------------------------------------------------------------------------
December 31, 2004                      4,245,641  $42,406  $5,841,331    (115,184) $(340,530) $(2,490,224)   $(51,357)    $3,043,627
                                       =============================================================================================
The accompanying notes are an integral part of the consolidated financial statement
</TABLE>


<PAGE>

<TABLE>
<CAPTION>


                                                       UNIVERSITY BANCORP, INC.
                                                 Consolidated Statements of Cash
                                         Flows For the years ended December 30,
                                         2004, 2003 and 2002

                                                                               2004                2003                2002
                                                                         ------------------  ------------------ -------------------
     Cash flow provided by (used in) operating activities:
<S>                                                                          <C>               <C>               <C>
     Net (loss)income                                                        $   (584,820)     $        94,442   $         205,598
     Adjustments to reconcile net (loss) income to net cash (used in)
     provided by operating activities:
         Depreciation                                                              318,584             305,740             195,070
         Amortization                                                              704,797             971,175             629,048
         Provision for loan loss                                                  (87,500)             189,400             100,000
         Gain on sale of mortgages                                               (340,149)           (756,170)           (236,098)
         Gain on the sale and leaseback of premises                              (184,873)           (217,053)                   -
         Loss(gain) on other real estate owned                                      64,695           (134,668)                   -
         Accretion on securities                                                  (11,562)            (15,836)           (259,463)
         Deferred income tax expense (benefit)                                      80,000            (80,000)
         Originations of mortgage loans                                       (52,016,364)       (129,039,261)         (70,457,559)
         Proceeds from mortgage loan sales                                      51,716,121         131,140,418          71,280,448
         Net loss (gain) on sale of securities                                         446              54,011            (69,733)
         Net change in:
           Other assets                                                          (538,295)         (1,025,362)           (268,115)
           Other liabilities                                                     (270,275)             265,470            (64,580)
                                                                        -------------------  ------------------ -------------------
     Net cash (used in) provided by operating activities                       (1,149,195)           1,752,306           1,054,616
                                                                        -------------------  ------------------ -------------------

     Cash flow provided by (used in) investing activities:
           Purchase of investment securities                                       (8,853)            (98,533)         (2,139,503)
           Proceeds from sales of investment
             securities                                                             49,981              59,879           1,034,160
           Proceeds from maturities/pay downs of
             investment securities                                                 529,247           1,497,117             651,486
           Proceeds from sale of other real estate
             owned                                                                 585,784             572,250
           Loans granted, net of repayments                                    (8,239,730)          (1,880,053)            859,898
           Proceeds from sale of premises                                                0           1,033,464
           Premises and equipment expenditures                                   (435,481)           (231,056)           (128,954)
                                                                        -------------------  ------------------ -------------------
     Net cash (used in) provided by investing activities                       (7,519,052)             953,068             277,087
                                                                        -------------------  ------------------ -------------------
</TABLE>


<PAGE>

<TABLE>
<CAPTION>



                                                     UNIVERSITY BANCORP, INC.
                                            Consolidated Statements of Cash
                                       Flows For the years ended December 30,
                                       2004, 2003 and 2002

                                                                               2004                2003              2002
                                                                         ------------------  ------------------ ---------------


     Cash flow provided by (used in) financing activities:
<S>                                                                              <C>               <C>               <C>
           Change in deposits                                                    5,780,247         (3,112,904)       1,722,875
           Change in short term borrowings                                       2,416,000                 0          (91,566)

           Principal payments on long term borrowings                            (132,000)         (132,000)       (1,359,506)
           Issuance of common stock                                                164,380           141,250           128,413
                                                                         ------------------ ----------------- -----------------
            Net cash provided by (used in) financing
             activities                                                          8,228,627       (3,103,654)           400,216
                                                                         ------------------ ----------------- -----------------

               Net change in cash and cash
                 equivalents                                                     (439,620)         (398,280)         1,731,919
     Cash and cash equivalents:
          Beginning of year                                                      2,171,189         2,569,469           837,550
                                                                         ------------------ ----------------- -----------------
          End of year                                                        $   1,731,569    $    2,171,189     $   2,569,469
                                                                         ================== ================= =================

     Supplemental disclosure of cash flow information:
           Cash paid for interest                                           $      785,275    $      887,092     $   1,119,502

     Supplemental disclosure of non-cash transactions:
           Mortgage loans converted to other real estate owned              $      755,022    $            0     $    $703,198
           Michigan BIDCO Preferred stock exchanged for a 7.5%
     promissory note                                                        $      600,000    $            0     $           0


</TABLE>



The accompanying notes are an integral part of the consolidated financial
statements.


<PAGE>


1. Summary of significant accounting policies

        Principles of Consolidation and Nature of Operations The consolidated
        financial statements of University Bancorp, Inc. (the Company) include
        the operations of its wholly-owned subsidiary, University Bank (the
        Bank), the Bank's wholly-owned subsidiary, University Insurance &
        Investment Services, Inc. (Agency) and an 80% owned subsidiary, Midwest
        Loan Services, Inc. ("Midwest"). The accounts are maintained on an
        accrual basis in accordance with generally accepted accounting
        principles and predominant practices within the banking and mortgage
        banking industries. All significant intercompany balances and
        transactions have been eliminated in preparing the consolidated
        financial statements.

        The Company is a bank holding company. University Bank, which is located
        in Michigan, is a full service community bank, which offers all
        customary banking services, including the acceptance of checking,
        savings and time deposits. The Bank also makes commercial, real estate,
        personal, home improvement, automotive and other installment, credit
        card and consumer loans, and provides fee based services such as annuity
        and mutual fund sales, stock brokerage and money management, life
        insurance, property casualty insurance and foreign currency exchange.
        The Bank's customer base is primarily located in the Ann Arbor, Michigan
        area. The Bank established its main office in Ann Arbor in February
        1996, by relocating from the eastern upper peninsula of Michigan.

        University Bank's loan portfolio is concentrated in Ann Arbor and
        Washtenaw County, Michigan. While the loan portfolio is diversified, the
        customers' ability to honor their debts is partially dependent on the
        local economy. The Ann Arbor area is primarily dependent on the
        education, healthcare, services and manufacturing (automotive and other)
        industries. Most real estate loans are secured by residential or
        commercial real estate and business assets secure most business loans.
        Generally, installment loans are secured by various items of personal
        property.

        The Agency is engaged in the sale of insurance products including life,
        health, property and casualty, and investment products including
        annuities, mutual funds, stock brokerage and money management. The
        Agency is located in the Bank's Ann Arbor main office. The Agency also
        has a limited partnership investment in low-income housing tax credits
        through Michigan Capital Fund for Housing Limited Partnership I with
        financing assistance from the General Partner, Michigan Capital Fund for
        Housing.

        Midwest is engaged in the business of servicing and subservicing
        residential mortgage loans. Midwest began operations in 1992 and was
        acquired by University Bank in December, 1995. Midwest is based in
        Houghton, Michigan, and also originates mortgage loans for itself and
        other financial institutions, including the Bank (See Note 3).

<PAGE>


1. Summary of significant accounting policies (continued)


        Use of Estimates in Preparing Financial Statements:
        --------------------------------------------------
        The preparation of financial statements in conformity with generally
        accepted accounting principles requires management to make estimates and
        assumptions based upon available information. These estimates and
        assumptions affect the reported amounts and disclosures. Actual results
        could differ from those estimates.

        The significant estimates incorporated into these consolidated financial
        statements which are more susceptible to change in the near term include
        the value of mortgage servicing rights, the allowance for loan losses,
        the identification and valuation of impaired loans, the valuation of
        other real estate owned, the fair value of financial instruments, and
        the valuation of deferred tax assets.

        Cash flow reporting
        For purposes of the Consolidated Statements of Cash Flows, cash and cash
        equivalents is defined to include the cash on hand, non-interest bearing
        deposits in other institutions, federal funds sold and other investments
        with a maturity of three months or less when purchased. Net cash flows
        are reported for customer loan and deposit transactions and interest
        bearing deposits with other banks.

        Securities
        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 in other
        comprehensive income or loss. Realized gains are based on specific
        identification of amortized cost. Securities are written down to fair
        value when a decline in fair value is not temporary. Interest income
        includes amortization of purchase premium or discount. Other securities
        such as Federal Home Loan Bank stock are carried at cost.

        Loans
        Loans are reported at the principal balance outstanding, net of unearned
        interest, deferred loan fees and costs, and an allowance for loan
        losses. 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 payments are past due over 90 days. Payments received on
        such loans are reported as principal reductions, unless all interest and
        principal payments in arrears are paid in full.


<PAGE>


1. Summary of significant accounting policies (continued)

       Mortgage banking activities
       Mortgage banking activities includes retail and servicing operations.
       Mortgage loans held for sale are valued at the lower of cost or market as
       determined by bid prices for loans in the secondary market. The loans are
       sold without recourse, except in the event that documentation errors are
       made during the origination process. Loan servicing and subservicing fees
       are contractually based and are recognized monthly as earned over the
       life of the loans.

        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 recoveries
        and decreased by charge-offs. Management estimates the balance required
        based on past loan loss experience, known and inherent risks in 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.

        Loan impairment is reported 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. Loans are evaluated for
        impairment when payments are delayed, typically 90 days or more, or when
        it is probable that all principal and interest amounts will not be
        collected according to the original terms of the loan.

        Premises and equipment
        Bank premises and equipment are stated at cost less accumulated
        depreciation. Depreciation is computed primarily on the straight-line
        method for bank premises and the accelerated method for equipment and
        land improvements over their estimated useful lives. The Company uses
        the following useful lives as of December 31, 2004:

                  Buildings and building improvements            39 years
                  Land and leasehold improvements                15 years
                  Furniture, fixtures, and equipment            3-7 years
                  Software                                      2-5 years

        Other real estate owned
        Real estate properties acquired in collection of a loan are recorded at
        fair value upon foreclosure. Any reduction to fair value from the
        carrying value of the related loan is accounted for as a loan loss.


<PAGE>


1. Summary of significant accounting policies (continued)

        After acquisition, a valuation allowance reduces the reported amount to
        the lower of the initial amount or fair value less costs to sell.
        Expenses, gains and losses on disposition, and changes in the valuation
        allowance are reported in other expenses.

        Servicing rights
        Servicing rights represent both purchased rights and the allocated value
        of servicing rights retained on loans originated and 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 grouping of the underlying loans as to type, term
        and interest rates. Any impairment of a grouping is reported as a
        valuation allowance.

        Income taxes
        Income tax expense/benefit is the sum of the current year estimated tax
        obligation or refund per the income tax return and the change in the
        estimated future tax effects of temporary differences and
        carry-forwards. Deferred tax assets or liabilities are computed by
        applying enacted income tax rates to the expected reversals of temporary
        differences between financial reporting and income tax reporting, and by
        considering carry-forwards for operating losses and tax credits. A
        valuation allowance adjusts deferred tax assets to the net amount that
        is more likely than not to be realized.

        Retirement plan
        The Bank has a 401(K) Plan that allows an employee to contribute up to
        15% of salary pre-tax, to the allowable limit prescribed by the Internal
        Revenue Service. Management has discretion to make matching
        contributions to the Plan. However, the Bank made no matching
        contributions for the years ended December 31, 2004, 2003 and 2002.

        Employees Stock Ownership Plan (ESOP)
        The Company has a noncontributory ESOP covering all full-time employees
        who have met certain service requirements. The employees' share in the
        Company's contribution is based on their current compensation as a
        percentage of the total employee compensation. As shares are contributed
        to the plan they are allocated to employees and compensation expense is
        recorded at the shares' fair value. The Company made no contribution in
        2004, 2003 and 2002.

        Stock options
       At December 31, 2004, the Company has a stock-based employee compensation
       plan, which is described more fully in Note 8. The Company accounts for
       those plans under the recognition and measurement principles of APB
       Opinion No. 25, Accounting for Stock Issued to Employees, and related
       Interpretations. No stock-based employee compensation cost is reflected
       in net income, as all options granted under those plans had an exercise
       price greater than or equal to the market value of the underlying common
       stock on the date of grant. The following table illustrates the effect on
       net (loss) income and earnings per share if the company

<PAGE>
<TABLE>
<CAPTION>


1. Summary of significant accounting policies (continued)
       had applied the fair value recognition provisions of FASB Statement No.
       123, Accounting for Stock-Based Compensation, to stock-based employee
       compensation.

                                                         Years Ended December 31,
                                                     2004            2003       2002
                                                     ----           ----        ----

<S>                                                <C>            <C>          <C>
       Net (loss) income, as reported              $(584,820)     $94,442     $205,578

       Deduct: Total stock-based employee
       compensation expense determined
       under fair value based method for
       all awards, net of tax                          5,600        5,000        6,000
                                                  -----------   ----------   ----------
       Pro forma net (loss) income                 $(590,420)     $89,442     $199,578
                                                  ===========   ==========   ==========
       Basic and Diluted (Loss) earnings per share:
         As reported                                $(0.14)         $0.02         $0.05
         Pro forma                                  $(0.14)         $0.02         $0.05
</TABLE>

        Dividend restriction
       Banking regulations require the maintenance of certain capital levels and
       may limit the amount of dividends that may be paid by the bank to the
       holding company or by the holding company to shareholders. In addition,
       the Bank cannot pay a dividend until it has net retained earnings or
       unless it receives a waiver from the State of Michigan banking
       regulators. The accumulated deficit of the Bank was $1,978,688 and
       $1,483,994 at December 31, 2004 and 2003, respectively.

        (Loss) earnings per share
       Basic earnings per share are computed by dividing net (loss) income
       available to common shareholders by the weighted average common shares
       outstanding. Diluted earnings per share reflect the potential dilution
       that would occur if dilutive securities were exercised or converted into
       common stock. The following table presents a reconciliation of the
       weighted average common shares outstanding for the earnings per share
       calculation for the years ended December 31:

                                               2004         2003       2002
                                              -----       -----        -----
       Weighted average shares outstanding  4,085,244   3,940,433   3,859,433

       Net dilutive effect of stock options    -          133,982     198,909
                                            ----------------------------------
       Diluted average shares outstanding   4,085,244   4,074,415   4,058,342
                                            =================================

        For December 31, 2004, the Company incurred a net loss. Accordingly,
        anti-dilutive impact of the effect of stock options is not shown.

<PAGE>


1. Summary of significant accounting policies (continued)

        Comprehensive (Loss) Income
        Comprehensive (loss) income includes both the net loss and the change in
        unrealized gains and losses on securities available for sale.

        Segment Reporting
        The Company's segments are determined by the products and services
        offered, primarily distinguished between banking and mortgage banking
        operations. Loans, investments, and deposits provide the revenues in the
        banking operation, and servicing fees, underwriting fees and loan sales
        provide the revenues in mortgage banking. All operations are domestic.

        Reclassification
        Certain items in the 2003 and 2002 consolidated financial statements and
        notes have been reclassified to conform to the 2004 presentation.

2. Michigan BIDCO, Inc.
        BIDCO was incorporated for the purpose of providing financing to small
        businesses located in Michigan for the purpose of creating business and
        industrial development in the State of Michigan. BIDCO is licensed under
        the Michigan BIDCO Act, and is regulated by the Michigan Office of
        Financial and Insurance Services, Bank and Trust Division. The President
        of the Company serves as Chairman and President of BIDCO.

       At December 31, 2003 University Bancorp owned 6.10% of the BIDCO and the
       Bank held a $600,000, 7.5% note collateralized by all assets of the
       company. The note was paid off in December 2004. Additionally, the shares
       of the BIDCO were sold. At December 31, 2004, the company no longer had a
       financial interest in the BIDCO

3. Secondary Market Operations
        Midwest provides servicing and subservicing of real estate mortgage
        loans for University Bank and several other financial institutions. The
        unpaid principal balance of these loans was approximately $2.31 billion,
        $1.94 billion and $1.06 billion as of December 31, 2004, 2003 and 2002
        respectively. Custodial escrow balances maintained in connection with
        these respective loans was $30.2 million, $26.8 million, and $23.4
        million, at December 31, 2003, 2002 and 2001 respectively. Most of these
        funds are off balance sheet and maintained at various financial
        institutions. The following summarizes the operations of Midwest for the
        years ended December 31:

<PAGE>

<TABLE>
<CAPTION>

3. Secondary Market Operations (continued)

                                                                            2004                 2003                  2002
                                                            --------------------- -------------------- ---------------------
<S>                                                                   <C>                  <C>                     <C>
      Loan servicing and subservicing fees                            $1,127,416           $1,128,293              $713,427
      Loan set-up and other fees                                       1,550,620            2,865,708             2,677,966
      Interest income                                                     35,533               42,940                45,922
      Gain on sale of loans                                             340,149               756,170               236,098
                                                            --------------------- -------------------- ---------------------
           Total income                                                3,053,717            4,793,111             3,673,413

      Salaries and benefits                                            1,518,595            1,646,483             1,348,884
      Amortization of servicing rights                                   448,553              865,977               522,081
      Interest expense                                                    11,320                3,798                 2,520
      Other operating expenses                                         1,104,106            1,851,073             1,365,091
                                                            --------------------- -------------------- ---------------------
           Total expenses                                              3,080,308            4,367,331             3,238,576
                                                            --------------------- -------------------- ---------------------
      (Loss)income of  Midwest                                        $  (26,591)          $  425,780            $  434,837
                                                            ===================== ==================== =====================
</TABLE>

        University Bank and Midwest sell conforming residential mortgage loans
        to the secondary market. These loans are owned by other institutions and
        are not included in the Company's consolidated balance sheets. Such
        mortgage loans have been sold predominately without recourse or with
        limited recourse. The unpaid principal balance of these loans was $120.6
        million, $112.3 million and $87.0 million at December 31, 2004, 2003 and
        2002 respectively.

        The following summarizes the activity pertaining to mortgage servicing
        rights, along with the aggregate activity in related valuation
        allowances. Table A is calculated net of the valuation allowance
        described in Table B.
<TABLE>
<CAPTION>

      Table A                                                           2004                2003                2002
                                                         ------------------- ------------------- -------------------
      Mortgage servicing rights:
<S>                    <C>                                        <C>                 <C>                  <C>
      Balance, January 1                                          $1,031,575          $1,014,939           $ 606,537
      Additions - originated                                         514,764             887,811             937,450
      Amortization expense                                         (380,553)           (472,175)           (480,048)
                                                         ------------------- ------------------- -------------------
      Adjustment for asset impairment change                        (68,000)           (399,000)            (49,000)
                                                         ------------------- ------------------- -------------------
      Balance, December 31                                       $1,097,786          $1,031,575           $1,014,939
                                                         =================== =================== ===================


      Table B
      Valuation allowances:
      Balance, January 1                                           $ 448,000            $ 49,000               $   0
      Additions                                                       68,000             399,000              49,000
                                                         ------------------- ------------------- -------------------
      Balance, December 31                                         $ 516,000           $ 448,000            $ 49,000
                                                         =================== =================== ===================
</TABLE>

        Market interest rate conditions can quickly affect the value of mortgage
        servicing rights in a positive or negative fashion, as long-term
        interest rates rise and fall. The amortization of these rights is based
        upon the level of principal pay downs received and expected prepayments
        of the mortgage loans. The servicing rights are recorded at the lower of
        cost or market.

<PAGE>

4. Securities available for sale (continued)
       The following is a summary of the amortized cost, gross unrealized gains,
       gross unrealized losses and fair value of securities available for sale
       at December 31, 2004, 2003 and 2002:
<TABLE>
<CAPTION>

   December 31, 2004
                                         Amortized        Unrealized            Fair
                                            Cost       Gains      Losses       Value
     U.S. agency mortgage-backed
<S>                                     <C>          <C>          <C>        <C>
             securities                 $1,157,964   $   -        $(51,356)  $1,106,607
                                         =========    ========   =========   =========

   December 31, 2003
                                         Amortized        Unrealized            Fair
                                            Cost      Gains       Losses       Value
     U.S. agency mortgage-backed
             Secuities                  $1,675,648   $   -        $(38,795)  $1,636,853
     Stocks                                 12,316       -          -            12,316
                                        ---------    --------    -------     ---------
                                       $1,687,964    $   -        $(38,795)  $1,649,169
                                       ==========    ========    =========   =========

   December 31, 2002
                                          Amortized      Unrealized             Fair
                                            Cost         Gains    Losses       Value
     U.S. agency mortgage-backed
             Securities                $3,184,835    $   -        $(81,997)  $3,102,838
                                       ==========    =======     =========   =========
</TABLE>


        At December 31, 2004 and 2003, the fair value of securities pledged to
        secure certain borrowings were $1,106,607 and $1,649,169, respectively.
        Unrealized losses at December 31, 2004 and 2003 have existed for longer
        than twelve months. This decline is considered temporary as the values
        of the mortgage-backed securities fluctuate based on changes in current
        interest rates and prepayment assumptions related to the underlying
        mortgages. Furthermore, the Company expects to hold these securities
        sufficiently long enough to recover these unrealized losses.

      Sales of available for sale securities:   2004       2003       2002
                                                ----       ----       ----
               Proceeds                      $49,981     $59,879   $1,034,160
               Realized gains                  3,605           -       69,733
               Realized losses                 4,051      54,011         -

        The scheduled maturity date of the securities available for sale at
December 31, 2004 is:

                                                   Amortized         Fair
                                                     Cost           Value
                     2005-2008                   $        0       $        0
                     2009-2013                            0                0
                     After 2013                   1,157,964        1,106,607
                                                 ----------       ----------
                                                 $1,157,964       $1,106,607
                                                 ==========       ==========


<PAGE>

<TABLE>
<CAPTION>



5.      Loans
        Major classifications of loans are as follows as of December 31:

                                                                   2004                  2003                  2002
                                                                   ----                  ----                  ----
<S>                                                        <C>                   <C>                   <C>
      Commercial                                           $ 15,079,343          $ 15,943,127          $ 16,550,325
      Real estate - mortgage                                 24,657,078            15,687,265            11,633,060
      Real estate -construction                               1,238,530             1,270,789             2,113,747
      Installment                                             1,820,515             1,905,793             2,799,490
      Credit cards                                              204,334               121,612                95,412
                                                          -------------         -------------         -------------
         Gross Loans                                         42,999,800            34,928,586            33,192,034
      Allowance for loan losses                               (353,124)             (454,118)             (408,219)
                                                          -------------         -------------         -------------
         Net Loans                                         $ 42,646,676          $ 34,474,468          $ 32,783,815
                                                          =============         =============         =============
</TABLE>
<TABLE>
<CAPTION>


     Changes in the allowance for loan losses were as follows:
                                                                            2004             2003              2002
                                                                            ----             ----              ----
<S>                                                                    <C>              <C>               <C>
      Balance, beginning of year                                       $ 454,118        $ 408,219         $ 579,113
      Provision charged to operations                                   (87,500)          189,400           100,000
      Recoveries                                                          55,512           97,008            16,570
      Charge-offs                                                       (69,006)        (240,509)         (287,464)
                                                                       ---------        ---------         ---------
      Balance, end of year                                             $ 353,124        $ 454,118         $ 408,219
                                                                       =========        =========         =========



        At December 31, 2004, there are loans totaling $371,109 that were past
        due over 90 days but still accruing interest. These loans were brought
        current shortly after December 31, 2004. There are no past due loans
        over 90 days and still accruing interest at December 31, 2003 and 2002.
        Non-accrual loans at December 31 are summarized as follows:

                                                                            2004             2003              2002
                                                                            ----             ----              ----
      Non accrual loans:
      Real estate - mortgage and construction loans                    $ 591,791        $   907,599       $ 102,713
      Installment loans                                                   16,739              5,128          67,546
      Commercial loans (non real estate)                                  39,490            204,400         509,301
                                                                       ---------        -----------       ---------
                                                                       $ 648,020        $ 1,117,127       $ 679,560
                                                                       =========        ===========       =========


        Information regarding impaired loans for the years ended December 31, is
as follows:

      Impaired loans:                                                       2004             2003              2002
      --------------                                                        ----             ----              ----
      Loans with no allowance allocated                                $  83,319        $         0       $       0
      Loans with allowance allocated                                   $ 564,701        $ 1,117,127       $ 679,560
      Amount of allowance for loan losses allocated                    $  83,548        $   291,754       $ 177,069

      Impaired loans:
      Average balance during the year                                  $ 719,667        $   946,261       $ 531,823
      Interest Income recognized thereon                               $       0        $     6,248       $   8,412
      Cash-basis interest income recognized                            $       0        $     6,248       $   8,412
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

6. Premises and equipment
        Classifications at December 31 are summarized as follows:
                                                                            2004             2003              2002
                                                                            ----             ----              ----
<S>                                                                  <C>                <C>              <C>
      Land                                                           $    32,811        $    32,811      $  132,931
      Buildings and improvements                                         234,984            234,984       1,157,624
      Furniture, fixtures,equipment and
      software                                                         2,756,982          2,327,279       2,108,391
                                                                    ------------       ------------     -----------
                                                                       3,024,777          2,595,074       3,398,946
        Less:  accumulated depreciation                              (2,078,073)        (1,765,267)     (1,678,044)
                                                                    ------------       ------------    ------------
            Net premises and equipment                               $   946,704        $   829,807     $ 1,720,902
                                                                    ============       ============    ============
</TABLE>

                In June 2003, the Bank sold its main office and sole branch
       location to Lowertown Development, LLC ("Lowertown") for $1,173,833, and
       a gain of $342,851. As part of this transaction, the Bank received an
       option to purchase 10,000 square feet of office space in a new facility
       to be constructed by Lowertown which was valued at $200,000.
       Simultaneously, the Bank entered into a 24 month lease agreement with
       Lowertown to leaseback the building sold. The lease included 5 six-month
       options to extend the lease until the earlier of the completion of the
       new building or December 2007. Lowertown is developing the neighboring
       area with a major office, retail and apartment development. Under the
       terms of the agreement, the Bank has an option to purchase 10,000 square
       feet of office space in this new development for fair market value up to
       a maximum of $2,000,000. It is currently anticipated that the new
       facility will be occupied in February 2007. Both the gain on the sale of
       the building and the purchase option are being amortized into income over
       the life of the expected lease term. Lowertown is obligated to pay the
       Bank $200,000 if the office space is not completed prior to the end of
       the extended lease period in December 2007.

        Depreciation expense amounted to $318,584, $305,741 and $290,516 for the
        years ended December 31, 2004, 2003 and 2002, respectively.

        The Bank began leasing its Maiden Lane building in June 2003. The rent
        for 2004 totaled $106,740. The Bank leases an ATM drive-thru location in
        Ann Arbor for $28,656 per year and one off-site ATM location for $9,000
        per year. Midwest leases its office space for approximately $50,424 per
        year in Houghton, Michigan. Total rental expense for all operating
        leases was $192,663, $144,778 and $55,861 in 2004, 2003 and 2002.

7.   Time deposits
        Time deposit liabilities issued in denominations of $100,000 or more
        were $1,854,614 and $2,632,451 at December 31, 2004 and 2003
        respectively.

        At December 31, 2004, stated maturities of time deposits were:

                          2005                         $8,199,043
                          2006                          3,068,588
                          2007                            521,596
                          2008                             95,870
                          2009                            113,744
                    Thereafter                            441,341
                                                     -------------
                                                      $12,440,182
                                                     =============
<PAGE>

        7. Time deposits (continued)
        The Bank had issued through brokers $3,651,000 and $1,101,000 of time
        deposits as of December 31, 2004 and 2003, respectively. These time
        deposits have maturities ranging from one to five months and are
        included in the table above. These deposits are issued in denominations
        of less than $100,000.

        The Bank had deposits of $1,400,430 and $1,550,233 from directors,
        officers and their affiliates as of December 31, 2004 and 2003,
        respectively.

8.       Stock options
        In 1995, the Company adopted a stock option and stock award plan (the
        1995 Stock Plan), which provides for the grant of incentive stock
        options, as defined in Section 422(b) of the Internal Revenue Code of
        1986, as amended, as well as the grant of non-qualified stock options
        and other stock awards. The plan provides for the grant to officers,
        directors and key employees of the Company, and independent contractors
        providing services to the Company, of options to purchase and other
        awards of common stock. The exercise price of options granted under the
        plan shall be determined by the Board of Directors, or a compensation
        committee thereof. Options shall expire on the date specified by the
        Board of Directors or such committee, but not more than 10 years from
        the
       date of grant (or five years from the date of grant for incentive stock
       options if the grantee owned 10% of the Company's voting stock at the
       date of grant). Unless amended, the 1995 Stock Plan will terminate on
       November 15, 2005. The following table summarizes the activity relating
       to options to purchase the Company's common stock:


                                                    Number of   Weighted Average
                                                     Options    Exercise price

      Outstanding at December 31, 2001               251,909       $1.60
      Forfeited - 2002                               (47,000)       1.61
      Granted - 2002 ($0.08 Fair Value)               75,000        1.00
                                                   ----------
      Outstanding at December 31, 2002               279,909        1.44
      Granted - 2003 ($0.10 Fair Value)               54,000        1.85
      Exercised - 2003                               (36,000)       1.33
      Forfeited - 2003                               (26,500)       1.26
                                                   ----------
      Outstanding at December 31, 2003               271,409        1.60
                                                   ----------
      Granted - 2004 ($0.46 Fair Value)               64,500        2.29
      Exercised - 2004                              (103,909)       1.65
      Forfeited - 2004                               (36,000)       2.00
                                                   ----------
      Outstanding at December 31,  2004              196,000        1.69
                                                  ===========

        At December 31, 2004:
        Number of options immediately exercisable                     117,200
        Weighted average exercise price of immediately
         exercisable options                                            $1.39
        Range of exercise price of options outstanding          $1.00 - $2.47
        Weighted-average remaining life of options outstanding     4.62 years
<PAGE>

8. Stock options (continued)

        The following summarizes assumptions used to value stock options.


                                          2004            2003             2002
                                          ----            ----             ----

           Risk-free interest rate       4.50%          4.00%            4.13%
           Expected option life        5.0 years      5.0 years        5.0 years
           Expected stock price
              Volatility                 23.4%          22.5%            21.2%
           Expected dividends              $0              $0               $0


9. Employee stock ownership plan (ESOP)
        The employees' allocation of ESOP assets is based on their current
        compensation, after 1 year of service and upon reaching the age of 21.
        The annual contribution to the ESOP is at the discretion of the Board of
        Directors. Assets of the plan are comprised entirely of 77,018 shares of
        the Company's stock at December 31, 2004 and 2003, all of which were
        fully allocated at December 31, 2004. Upon retirement from the plan,
        participants can receive distributions of their allocated shares of the
        Company's stock. The assets of the ESOP are held in trust and were
        valued at approximately $139,000, and $199,000 at December 31, 2004 and
        2003, respectively.

10.      Minority Interest
        The Bank owns an 80% interest in the common stock of Midwest, with the
        remaining 20% owned by the President of Midwest. At December 31, 2004
        and 2003, total common stockholders' equity of Midwest was $2,200,229
        and $2,226,820 resulting in a $440,118 and $445,324 minority interest
        reflected on the Company's consolidated balance sheet, respectively. The
        results of Midwest's operations for 2004, 2003 and 2002 are included in
        the Company's consolidated statement of operations.

11.      Commitments and contingencies
        The Bank is party to financial instruments with off-balance sheet risk
        in the normal course of business to meet the financing needs of its
        customers. These financial instruments include commitments to buy, sell
        and fund loans, letters of credit and unused lines of credit. The Bank's
        exposure to credit loss in the event of non-performance is equal to or
        less than the contractual amount of these instruments. The Bank follows
        the same credit policy to make such commitments as that followed by
        loans recorded in the consolidated financial statements. The following
        is a summary of commitments as of December 31:

                                     2004          2003            2002
                                     ----          ----            ----
      Unused lines of credit      $ 4,907,000   $ 3,762,000     $2,094,000
      Commitments to fund loans     3,366,000     2,562,000      3,748,000
      Foreign exchange futures                      75,000
                                  -----------   -----------     ----------
           Total                  $ 8,273,000   $ 6,399,000     $5,842,000
                                  ===========   ===========     ==========
<PAGE>

12.      Related party transactions
        The Company's President also serves as President and Chairman of
        Michigan BIDCO. As such, the President is actively involved in the
        BIDCO's operations, including investment activity and estimation of the
        fair value of its equity investments. In December, 2004, the BIDCO paid
        in full its $600,000 note to the Bank. Additionally, the Bancorp sold
        its 6.10% in the BIDCO. At December 31, 2004, neither the Bank nor the
        Bancorp had a financial interest in or with BIDCO.

        The Bank had loans outstanding of $44,232 and $280,690 to related
        officers and directors at December 31, 2004 and 2003, respectively.
        During 2004, two loans totaling $620,000 were originated. There were no
        related party loans that were originated during 2003 that were
        outstanding at year end. During 2003, a construction line of credit
        issued in 2002 was terminated. Available lines of credit to related
        parties at the December 31, 2004 and 2003, totaled $118,768 and $156,373
        respectively. Related party loans were made in the normal course of
        business and were performing pursuant to terms at December 31, 2004.

13.      Income taxes
        At December 31, 2004 income tax expense of $80,000 was recorded due to
        uncertainties as to the future benefits of the net operating losses.

        At December 31, 2003, the Company recorded an $80,000 tax benefit as a
        deferred tax asset which represented a portion of the existing net
        operating loss carry-forward that was expected to be utilized to offset
        future taxable income.

        The net deferred tax asset at December 31, 2004 and 2003 is comprised of
        the following:

                                                   2004                2003

      Allowance for loan losses              $    123,732        $   276,579
      Net operating loss carry-forward            707,369            487,663
      Tax credit carry-forward                  1,111,810            989,123
      Deferred gain on sale leaseback              71,715             85,568
      Donation carry-forward                        9,058             46,819
      Other                                       138,189             57,708
                                            -------------        ------------
            Deferred tax assets                 2,161,873          1,943,460
                                            -------------        ------------

      Servicing rights                          (373,247)          (339,009)
      Depreciation                               (32,839)           (32,661)
                                            -------------        ------------
           Deferred tax liabilities             (406,086)          (371,670)
                                            -------------        ------------
           Net deferred tax asset               1,755,787          1,571,790
           Valuation allowance for
            deferred tax assets               (1,755,787)        (1,491,790)
                                            -------------        ------------
           Net deferred tax asset            $          0         $   80,000
                                            =============        ============

       The Company has net operating loss carry-forwards of approximately
       $2,080,000 which expire beginning in 2012 and general business credit
       carry-forwards of approximately $1,112,000 which expire beginning in
       2011. Financial statement tax expense amounts differ from the amounts
       computed by applying the statutory federal tax rate of 34% to pretax
       income because of operating losses and valuation allowances recorded to
       reduce deferred tax assets as noted above.


<PAGE>




14.      Short Term Borrowings
        The Bank had a line of credit available from the Federal Home Loan Bank
        (the FHLB) in the amount of $4.0 million and $3.0 million at December
        31, 2004 and 2003, respectively. At December 31, 2004, borrowings were
        secured by the pledge of specific mortgage loans held for investment
        with unpaid principal balances of $5.4 million and available-for-sale
        securities with a balance of $1.1 million.

        The Bank had a line of credit available from the Federal Reserve Bank of
        Chicago (the FRB) in the amount of $5.7 million. There were no amounts
        outstanding on this line from the FRB at December 31, 2004 and 2003.
        Borrowings are secured by the pledge of specific commercial loans held
        for investment with unpaid principal balances of $7.8 million. The
        following information provides a summary of short-term borrowings for
        the years indicated:
                                                  2004               2003
                                                  ----               ----
      Amount outstanding at the end of
      the year and interest rate             $2,416,000  1.65%  $      0

      Maximum amount of borrowing outstanding
       at any month end during the year      $2,601,000         $991,000

         Average amount outstanding during the
          year and weighted average rate     $972,076    1.75%  $227,063  1.29%

15.      Long Term Borrowings
        The Company had a note payable to North Country Bank & Trust (NCB&T)
        secured by the stock of the Bank with a balance of $34,000 and $166,000
        at December 31, 2004 and 2003, respectively. The note has a maturity
        date of February 15, 2005. Interest is payable quarterly at the prime
        rate of NCB&T plus 1.00 percent.

        Dividends by the Bank to the holding company in excess of the prior
        year's annual net income are not permitted without prior permission from
        NCB&T under the terms of the Company's credit facility.

16.      Regulatory matters
       University Bank is subject to various regulatory capital requirements
       administered by the federal banking agencies. Failure to meet minimum
       capital requirements can initiate certain mandatory and possibly
       additional discretionary, actions by regulators that, if undertaken,
       could have a direct material effect on the Company's financial
       statements. Under capital adequacy guidelines and the regulatory
       framework for prompt corrective action, the Bank must meet specific
       capital guidelines that involve quantitative measures of the Bank's
       assets, liabilities, and certain off-balance-sheet items as calculated
       under regulatory accounting practices. The Bank's capital amounts and
       classification are also subject to qualitative judgments by regulators
       about components, risk weightings, and other factors.

       The Bank is also subject to prompt corrective action capital requirement
       regulations set forth by the FDIC. The FDIC requires the Bank to maintain
       a minimum of total capital and Tier 1 capital (as defined) to
       risk-weighted assets (as defined), and of Tier I capital (as defined) to
<PAGE>

16. Regulatory matters (continued)

       average total assets (as defined). As of December 31, 2004, the Bank did
       not meet all capital adequacy requirements to which it is subject as the
       Bank presently has a written understanding with its regulators that the
       Bank will maintain the ratio of Tier 1 Capital to average assets at 7% or
       more. Management has submitted a plan of corrective action to the FDIC.
       This plan includes the possible issuance of preferred stock.

       As of December 31, 2004, the most recent guidelines from the FDIC
       categorized the Bank as "adequately capitalized" under the regulatory
       framework for prompt corrective action. At December 31, 2003 the Bank was
       classified as "well capitalized." To be categorized as "well
       capitalized," or "adequately capitalized" the Bank must maintain minimum
       total risk-based, Tier 1 risk-based, and Tier 1 leverage ratios as set
       forth in the table.

<TABLE>
<CAPTION>

                                                                               To Be Adequately           To Be Well
                                                                                 Capitalized              Capitalized
                                                                                 Under Prompt             Under Prompt
                                                                              Corrective Action           Corrective Action
                                                                                  Provisions              Provisions

                                         Amount        Ratio        Amount           Ratio      Amount              Ratio
As of December 31, 2004:

Total capital (to risk
<S>                                     <C>             <C>         <C>               <C>        <C>                <C>
 weighted assets)                       $3,515,000      9.5 %       $2,965,000        8.0 %      $3,706,000         10.0 %
Tier I capital (to risk
 weighted assets)                        3,158,000      8.5 %        1,482,000        4.0 %       2,224,000          6.0 %
Tier I capital (to
 average assets)                         3,158,000      6.5 %        1,959,000        4.0 %       2,449,000          5.0 %


As of December 31, 2003:

Total capital (to risk
 weighted assets)                       $4,129,000     12.3 %       $2,689,000        8.0 %      $3,362,000         10.0 %
Tier I capital (to risk
 weighted assets)                        3,708,000     11.0 %        1,345,000        4.0 %       2,017,000          6.0 %
Tier I capital (to
  average assets)                        3,708,000      8.6 %        1,728,000        4.0 %       2,160,000          5.0 %
</TABLE>


17.     Management's Plan Regarding Continuing Operations At December 31, 2004,
        University Bancorp had an accumulated deficit of $2,490,224 and
        recurring losses from operations for 3 of the past 5 years. University
        Bancorp's operations are intended to continue in the future. Management
        has reviewed operating results, prepared projections of possible future
        results, performed other analyses of its operations to reduce operating
        costs and entered new product lines of business.

<PAGE>

17. Management's Plan Regarding Continuing Operations (continued)

        Management of the Company has implemented a plan to improve core
        earnings by adding low-cost deposits, adjusting fees, growing the loan
        portfolio of the Bank, reducing loan delinquencies, liquidating other
        real estate owned, improving the synergy between its subsidiary
        operations, and eliminating inefficient or redundant costs at the Bank
        level. Both the Bank and Midwest are projected to have net income in
        2005, however, the Company's continued operation is dependent upon its
        ability to maintain profitable operations and retain adequate capital
        levels.

18.      Fair Value of Financial Instruments
        The following methods and assumptions were used to estimate fair values
        for financial instruments. The carrying amount is considered to estimate
        fair value for cash and short-term instruments, demand deposits,
        short-term borrowings, accrued interest, and variable rate loans or
        deposits that reprice frequently and fully. Securities fair values are
        based on quoted market prices or, if no quotes are available, on the
        rate and term of the security and on information about the issuer. For
        fixed rate loans or deposits and for variable rate loan or deposits with
        infrequent repricing or repricing limits, the fair value is estimated by
        the discounted cash flow analysis using current market rates for the
        estimated life and credit risk. Fair values for impaired loans are
        estimated using discounted cash flow analyses of underlying collateral
        values, where applicable. Fair value of loans held for sale is based on
        market estimates. Fair value of mortgage servicing rights is estimated
        using discounted cash flows based on current market interest rates net
        of estimated costs of servicing loans. Fair value of mortgage
        subservicing rights is based on a multiple of servicing contract
        revenue. The fair value of debt is based on currently available rates
        for similar financing. The fair value of off-balance sheet items is
        based on the fees or cost that would normally be charged to enter into
        or terminate such agreements. Fair value of unrecognized financial
        instruments includes commitments to extend credit and the fair value of
        letters of credit is considered immaterial.


<PAGE>


18. Fair Value of Financial Instruments (continued)

        The carrying amounts and fair values of the Company's financial
instruments were as follows:

                                                  December 31, 2004
                                                Carrying        Fair
        Financial Assets                        Amount         Value
        ----------------                        ------         -----
        Cash and short term investments     $ 1,732,000   $ 1,732,000
        Securities available for sale         1,106,000     1,106,000
        Federal Home Loan Bank stock            922,000       922,000
        Loans held for sale                     846,000       846,000
        Loans, net                           42,647,000    43,436,000
        Mortgage servicing rights             1,097,000     1,097,000
        Accrued interest receivable             148,000       148,000

        Financial Liabilities
        Deposits                             44,588,000    44,640,000
        Short term borrowings                 2,416,000     2,416,000
        Long term borrowings                     34,000        34,000
        Accrued interest payable                 50,000        50,000



                                                  December 31, 2003
                                                Carrying       Fair
        Financial Assets                        Amount         Value
        ----------------                        ------         -----
        Cash and short term investments     $ 2,171,000   $ 2,171,000
        Securities available for sale         1,649,000     1,649,000
        Federal Home Loan Bank stock            881,100       881,100
        Loans held for sale                     206,000       206,000
        Loans, net                           34,474,000    35,630,000
        Mortgage servicing rights             1,032,000     1,032,000
        Accrued interest receivable             130,000       130,000

        Financial Liabilities
        Deposits                             38,808,000    39,048,000
        Long term borrowings                    166,000       166,000
        Accrued interest payable                 52,000        52,000


19.      Segment Reporting

        The Company's operations include two primary segments: retail banking
        and mortgage banking. Through its banking subsidiary's branch in Ann
        Arbor, the Company provides traditional community banking services such
        as accepting deposits, making loans, and providing cash management
        services to individuals and local businesses. Mortgage banking
        activities includes servicing of residential mortgage loans for others
        (See Note 2).

<PAGE>


19.      Segment Reporting (continued)


        The Company's two reportable segments are strategic business units that
        are separately managed as they offer different products and services and
        have different marketing strategies. In addition, the mortgage banking
        segment services a different customer base from that of the retail
        banking segment.

        The segment financial information provided below has been derived from
        the internal profitability reporting system used by management to
        monitor and manage the financial performance of the Company. The
        accounting policies of the three segments are the same as those
        described in the summary of significant accounting policies. The Company
        evaluates segment performance based on profit or loss before income
        taxes, not including nonrecurring gains and losses. Certain indirect
        expenses have been allocated based on actual volume measurements and
        other criteria, as appropriate. The Company accounts for transactions
        between segments at current market prices. Segment profit is measured
        before allocation of corporate overhead and income tax expense.


        Information about reportable segments for the year ended December 31,
2004 follows:

<TABLE>
<CAPTION>
                                                              Retail         Mortgage
                                                             Banking          Banking              Totals
<S>                                                        <C>              <C>                 <C>
     Interest income                                       $2,708,738       $   35,533          $2,744,271
     Gain on the sale of mortgage
       loans                                                        0          340,149             340,149
     Other non-interest income                                804,363        2,678,036           3,482,399
     Interest expense                                         772,031           11,927             783,958
     Provision for loan losses                               (87,500)                0            (87,500)
     Salaries and benefits                                  1,348,254        1,518,595           2,866,849
     Occupancy                                                284,147          131,009             415,156
     Other operating expense                                1,660,699        1,432,476           3,093,175
     (Loss) income before tax
        expense                                             (464,531)         (40,289)           (504,820)
     Income tax (benefit) expense                              93,698         (13,698)              80,000
     Segment (loss) profit                                  (558,229)         (26,591)           (584,820)
     Segment assets                                        48,545,358        2,240,340          50,785,698
     Capital expenditures                                     252,530          182,951             435,481
     Depreciation                                             150,776          167,808             318,584
     Amortization                                             258,510          446,287             704,797


<PAGE>

19.      Segment Reporting (continued)


        Information about reportable segments for the year ended December 31,
2003 follows:

                                                              Retail         Mortgage
                                                             Banking          Banking              Totals
      Interest income                                     $2,689,157          $42,942          $2,732,099
      Gain on the sale of mortgage
         loans                                                     0          756,170             756,170
      Other non-interest income                            1,182,413        3,993,999           5,176,322
      Interest expense                                       836,734            4,903             841,637
      Provision for loan losses                              189,400                0             189,400
      Salaries and benefits                                1,711,577        1,646,483           3,358,060
      Occupancy                                              245,931          176,836             422,767
      Other operating expense                              1,524,729        2,313,466           3,838,285
      (Loss) income before tax
         expense                                           (636,801)          651,423              14,442
      Income tax (benefit) expense                         (305,643)          225,643            (80,000)
      Segment (loss) profit                                (331,158)          425,780              94,442
      Segment assets                                      40,667,106        2,356,200          43,023,306
      Capital expenditures                                   108,309          122,747             231,056
      Depreciation                                           153,744          151,996             305,740
      Amortization                                           105,198          865,977             971,175

        Information about reportable segments for the year ended December 31,
2002 follows:


                                                              Retail         Mortgage
                                                             Banking          Banking              Totals
      Interest income                                     $3,148,530          $45,922          $3,194,452
      Gain on the sale of mortgage
         loans                                                     0          236,098             236,098
      Other non-interest income                              813,528        3,391,393           4,204,921
      Interest expense                                     1,036,643            2,520           1,039,163
      Provision for loan losses                              110,000         (11,000)             100,000
      Salaries and benefits                                1,580,656        1,348,884           2,929,540
      Occupancy                                              185,859          163,327             349,186
      Other operating expense                              1,246,494        1,755,051           3,001,545
      (Loss) income before tax
        expense                                            (229,239)          434,837             205,598
      Income tax (benefit) expense                         (153,665)          153,665                   0
      Segment (loss) profit                                 (75,574)          281,172             205,598
      Segment assets                                      44,078,661        2,170,652          46,249,313
      Capital expenditures                                    22,255          106,699             128,954
      Depreciation                                            75,831          119,239             195,070
      Amortization                                           106,967         $522,081             629,048

</TABLE>



<PAGE>


<TABLE>

<CAPTION>


20.      Quarterly Financial Data -Unaudited
       The following tables represent summarized data for each of the quarters
       in 2004 and 2003 (in thousands, except loss per share data).
                                                                                         2004
                                                             ------------------------------------------------------------------
                                                             Quarter           Quarter            Quarter             Quarter
                                                              Ended             Ended              Ended               Ended
                                                              March 31          June 30          September 30        December 31
<S>                                                             <C>               <C>                 <C>                 <C>
Interest income                                                 $635              $643                $720                $746
Interest expense                                                 187               184                 198                 215
                                                             -----------------------------------------------------------------
Net interest income                                              448               459                 522                 531
Provision for losses                                              23                23                (28)               (106)
                                                             -----------------------------------------------------------------
Net interest income after
Provision for losses                                             425               436                 550                 637
Loan set-up and other fees                                       383               508                 311                 370
Loan servicing and subservicing fees                             334               348                 357                 349
Gain on sale of loans                                             89                69                  65                 117
Other non-interest income                                        158               147                 120                  99
Non-interest expense                                           1,574             1,594               1,539               1,669
                                                            ------------------------------------------------------------------
Income tax expense                                                 -                 -                  80                   -
                                                            ------------------------------------------------------------------
Net (loss) available to common shareholders                   ($185)             ($86)              ($216)               ($97)
                                                            ==================================================================
Basic and diluted loss per share                             ($0.05)           ($0.02)             ($0.05)             ($0.02)
                                                           ===================================================================
Weighted average shares outstanding                        4,058,108         4,090,548           4,090,548           4,101,011
                                                           ===================================================================
</TABLE>



<PAGE>



<TABLE>
<CAPTION>

20. Quarterly Financial Data -Unaudited (continued)

                                                                                         2003
                                                              -----------------------------------------------------------------
                                                                Quarter           Quarter           Quarter            Quarter
                                                                Ended             Ended              Ended             Ended
                                                                March 31          June 30         September 30       December 31
                                                             -----------------------------------------------------------------
<S>                                                             <C>               <C>                <C>                 <C>
Interest income                                                 $ 695             $ 681              $ 671               $ 685
Interest expense                                                  227               218                195                 202
                                                               -----------------------------------------------------------------
Net interest income                                               468               463                476                 483
Provision (credit)for losses                                      106                39                 22                  22
                                                               -----------------------------------------------------------------
Net interest income after
   Provision for losses                                           362               424                454                 461
Loan set-up and other fees                                        822             1,068                965                 528
Loan servicing and subservicing fees                              201               232                280                 415
Gain on sale of loans                                             184               305                180                  87
Other non-interest income                                         115                90                277                 183
Non-interest expense                                            1,611             2,105              2,124               1,779
                                                             -----------------------------------------------------------------
Income before tax benefit                                          73                14                 32               (105)
                                                             -----------------------------------------------------------------
Income tax benefit                                                  -                 -               (80)                   -
                                                             -----------------------------------------------------------------
Net earnings(loss) available to common                           $ 73              $ 14              $ 112             $ (105)
shareholders
                                                            ==================================================================
Basic and diluted earnings (loss) per share                    $ 0.02            $ 0.00              $0.03             $(0.03)
                                                           ===================================================================
Weighted average shares outstanding                         3,899,548         3,899,548          3,951,944           4,009,309
                                                           ===================================================================

</TABLE>


<PAGE>





21.       Parent Company Only Condensed Financial Information
                             Condensed Balance Sheet

                                             December 31,          December 31,
                                                 2004                  2003
                                         --------------------- -----------------
   ASSETS
   Cash and cash equivalents                $    5,626            $      669
   Securities available for sale                  -                   12,316
   Investment in University Bank             3,050,721             3,557,977
   Investment in Michigan BIDCO                 -                     29,258
   Other assets                                  3,137                 3,768
                                           -----------           -----------
      Total Assets                         $ 3,059,484           $ 3,603,988
                                           ===========           ===========
   LIABILITIES AND STOCKHOLDERS' EQUITY
   Notes payable                              $ 34,000             $ 166,000
   Accounts payable                             23,601                 2,000
   Accrued interest payable                        257                 1,361
                                           -----------           -----------
      Total Liabilities                         57,858               169,361
   Stockholders' Equity                      3,001,626             3,434,627
                                           -----------           -----------
      Total Liabilities and
       Stockholders' Equity                $ 3,059,484            $3,603,988
                                           ===========           ===========


<PAGE>




21   Parent Company Only Condensed Financial Information (continued)
                         Condensed Statements of Income

                                                2004        2003       2002
                                            -----------  ---------   --------
     INCOME:
        Interest and dividends on
           investments                      $      266   $   339     $   328
        Net security losses                       (446)  (26,574)         -
                                            -----------  ---------   -------
                    Total (loss)income           (180)   (26,235)        328

     EXPENSES:
        Interest                                 4,907     12,144     20,675
        Public listing                          45,696     43,088     38,202
        Professional fees                       36,976     24,000     33,513
        Other miscellaneous                      2,726      5,250      3,014
                                            ----------   --------    -------
                    Total Expense               90,305     84,482     95,404
     Loss before federal income taxes
          and equity in undistributed
          net loss of subsidiaries            (90,125)  (110,717)    (95,076)
     Federal income taxes                           -          -           -
                                            ----------   --------    -------
     Loss before equity in undistributed
          net loss of subsidiaries            (90,125)  (110,717)    (95,076)
     Equity in undistributed net
         (loss)income of subsidiaries        (494,695)    205,159    300,674
                                            ----------   --------   --------
     Net(loss)income                        $(584,820)   $ 94,442   $205,598
                                            ==========   ========   ========
<PAGE>

<TABLE>
<CAPTION>


21.                              Parent Company Only Condensed Financial
                                 Information (continued) Condensed Statements of
                                 Cash Flows
                                                                                                  For Year Ended
                                                                                      2004            2003               2002
                                                                                   ----------     ------------       ----------
      Cash flow provided by (used in) investing activities:
<S>                                                                                <C>            <C>                <C>
      Net Income (Loss)                                                            $ (584,820)    $     94,442       $ 205,598
      Adjustments to reconcile net loss to net cash provided by
      (used in) operating activities:
       Amortization of goodwill                                                             -                -                -
       Loss on sale of investments                                                        446           27,783                -
       Decrease (increase) in receivable from affiliate                                     -                -          286,196
       Decrease (increase) in other assets                                                631            (407)            (256)
       Decrease (increase) in other liabilities                                        20,498         (97,414)         (71,050)
       Decrease (increase) investment in subsidiaries                                 494,695        (205,159)        (300,673)
       Decrease in investment in Michigan BIDCO                                             -                -                -
                                                                                   ----------     ------------       ----------
         Net cash (used in) provided by operating activities                         (68,551)        (180,755)          119,815
                                                                                   ----------     ------------       ----------
      Cash flow from investing activities:
       Purchase of available for sale securities                                      (8,853)         (98,563)
       Proceeds from sale of available for sale securities                             49,981           58,464                -
                                                                                   ----------     ------------       ----------
         Net cash provided by (used in) investing activities                           41,128         (40,099)
                                                                                   ----------     ------------       ----------
      Cash flow from financing activities:
       Principal payment on notes payable                                           (132,000)        (132,000)        (132,000)
       Issuance of common stock                                                       164,380          141,250          128,413
                                                                                   ----------     ------------       ----------
         Net cash provided by (used in) financing activities                           32,380            9,250          (3,587)
                                                                                   ----------     ------------       ----------
                 Net change in cash and cash equivalents                                4,957        (211,604)          116,228
           Cash and cash equivalents:
             Beginning of year                                                            669          212,273           96,045
                                                                                   ----------     ------------       ----------
             End of year                                                           $    5,626     $        669       $  212,273
                                                                                   ==========     ============       ==========
          Supplemental disclosure of cash flow information: Cash paid during the
           year for:
             Interest                                                              $    6,011     $     12,755           60,686


</TABLE>



<PAGE>






Item 9.         Changes in and Disagreements with Accountants on Accounting and
                Financial Disclosures.

         None

ITEM 9A.        Controls and Procedures.

               (a) Evaluation of Disclosure Controls and Procedures.
               -----------------------------------------------------
               Disclosure controls are procedures that are designed with an
               objective of ensuring that information required to be disclosed
               in our companys periodic reports filed with the Securities and
               Exchange Commission, such as this report on Form 10-K, is
               recorded, processed, summarized, and reported within the time
               periods specified by the Securities and Exchange Commission.
               Disclosure controls also are designed with an objective of
               ensuring that such information is accumulated and communicated to
               our companys management, including our chief executive officer
               and chief financial officer, in order to allow timely
               consideration regarding required disclosures


               As of the end of the period covered by this report, an evaluation
               was carried out under the supervision and with the  participation
               of  the  Company's  management,  including  our  Chief  Executive
               Officer and Chief Financial Officer,  of the effectiveness of the
               design and operation of our  disclosure  controls and  procedures
               (as defined in Rules 13a-14(c) under the Securities  Exchange Act
               of 1934). Based upon that evaluation, the Chief Executive Officer
               and Chief Financial  Officer  concluded that, except as described
               below, the operation of these disclosure  controls and procedures
               were  effective.  During the course of the audit of our financial
               statements for the year ended December 31, 2004, our  independent
               registered public accounting firm, Grant Thornton LLP,  indicated
               that  the  following  material  deficiencies,  in the  aggregate,
               constitute a material  weakness in our internal controls pursuant
               to  standards   established  by  the  Public  Company  Accounting
               Oversight Board:

                  (1)      The Company lacks sufficiently formalized accounting
                           policies and procedures, including written procedures
                           for the preparation of the Quarterly Report on Form
                           10-Q in accordance with applicable SEC guidelines.

                  (2)      The Company's manual procedures for performing
                           consolidations increase the possibility that errors
                           could occur and our dual controls may not be
                           sufficient to guarantee avoidance of all errors in
                           consolidation.

                  (3)      The Company may have insufficient staff in the
                           accounting and financial reporting departments to
                           meet the needs of Sarbanes-Oxley Section 404
                           standards by June 2006

                  (4)      The Company replaced its core banking software
                           application during the summer of 2004. The core
                           banking system is now out-sourced to a service bureau
                           whereas previously the bank maintained the core
                           banking system in house. During the transition and
                           for a period afterwards it was necessary to give
                           certain members of senior management additional
                           access rights for training and the transition
                           requirements in the new system. In March 2005, access
                           rights for the banking software were revised and
                           access rights were reassigned to levels appropriate
                           for a routine operating environment. The controls in
                           the new core banking application in place today are
                           significantly better than the overall control levels
                           in the system that was replaced.

                  Management has begun implementing plans to address each of
                  items 1-3, further improving on the systems and procedures
                  already in place. Management believes that its plans with
                  respect to each of these items will be completed and
                  implemented in the second quarter of 2005.


                  With respect to policies and procedures for the Quarterly
                  Report on Form 10-Q, management notes that it uses a checklist
                  prepared by the American Institute of Certified Public
                  Accountants to assist in the preparation of SEC reports and
                  that it maintains a reference library of SEC and accounting
                  handbooks. Management is implementing plans to further
                  formalize its procedures and
<PAGE>

                  expects to complete and implement this in the second quarter
                  of 2005.

                  Management believes that the Company's general ledger and core
                  processing systems for each entity in the consolidation are
                  effective and are consistent with systems used by others in
                  our industry. We have evaluated our procedures and made
                  changes to increase the automation and dual controls for
                  preparing consolidated results.

                  Management believes that the current staff in the accounting
                  and financial reporting is sufficient and properly trained to
                  implement appropriate internal controls and to generate
                  accurate financial statements. We continue to provide training
                  and to document our systems and procedures to make sure that
                  the Company is able to comply with the internal control report
                  requirements by the applicable deadline.

         (b)      Changes in Internal Controls. Except as described above, there
                  were no significant changes in the Company's internal controls
                  over financial reporting during the fourth quarter of the
                  fiscal year ended December 31, 2004, that have materially
                  affected, or are reasonably likely to materially affect, the
                  Company's internal control over financial reporting


<PAGE>

<TABLE>
<CAPTION>


                                Index of Exhibits

<S>                                                                            <C>
                                                                                Sequentially
         Exhibit Number and Description                                         Numbered Page

(3) Certificate of Incorporation and By-laws:

3.1      Composite Certificate of Incorporation of the Company, as amended
         (incorporated by reference to Exhibit 3.1 to the June 30, 1996 10-Q").

3.1.1    Certificate of Amendment, dated June 10, 1998, of the Company's
         Certificate of Incorporation (incorporated by reference to Exhibit
         3.1.1 to the June 30, 1998 10-Q").

3.2      Composite By-laws of the Company (incorporated by reference to Exhibit
         3.2 to the 1989 10-K).

(10) Material Contracts.

10.1     Loan Agreement and Promissory Note dated December 31, 1997 issued to
         North Country Bank & Trust (incorporated by reference to Exhibit 10.1
         to the 1997 10-K"))

10.2     University Bancorp, Inc. Employee Stock Ownership Plan (the "ESOP"), as
         amended November 27, 1990 (incorporated by reference to Exhibit 10.2 to
         the 1990 10-K).

10.2.1   Amendment to the ESOP, effective as of December 31, 1991 (incorporated
         by reference to Exhibit 10.2.A to the 1991 10-K).

10.3     University Bank 401(k) Profit Sharing Plan, adopted August 1, 1996,
         effective as of January 1, 1996 (incorporated by reference to Exhibit
         10.3 to the 1996 10-K).

10.4     1995 Stock Plan of the Company (incorporated by reference to Exhibit A
         to the definitive Proxy Statement of the Company for the 1996 Annual
         Meeting of Stockholders (the "1996 Proxy).

10.4.1   Form of Stock Option Agreement related to the 1995 Stock Plan
         (incorporated by reference to Exhibit 10.7.1 to the 1995 10-K).

10.5     Letter, dated December 1, 1989, from Federal Reserve Bank of
         Minneapolis (incorporated by reference to Exhibit 10.9 to the 1989
         10-K).

10.6     Federal Income Tax Allocation Agreement Between
         Newberry State Bank and Newberry Holding Inc. dated
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

         March 21, 1992 (incorporated by reference to Exhibit 10.11 to the 1991
         10-K).

10.6.1   Federal Income Tax Allocation Agreement Between
         Newberry Holding Inc. and University Bancorp, Inc.
         dated May 21, 1991 (incorporated by reference to
         Exhibit 10.11.1 to the 1991 10-K).

<C>                                                                                       <C>
21       Subsidiaries of Registrant.                                                      79

23.1     Reports of Independent Auditors, Richard C. Woodbury, P.C., dated
         February 25, 2005 regarding Midwest Loan Services, Inc.                          80

23.2     Consent of Grant Thornton, LLP, Independent Registered Public  Accounting
              Firm                                                                        81

23.3     Consent of Richard C. Woodbury, P.C., Independent
              Registered Public Accounting Firm                                           82


31.3        Certification pursuant to Section 302 of the Sarbanes-Oxley
               Act of 2002                                                                83

31.4     Certification pursuant to Section 302 of the Sarbanes-Oxley
               Act of 2002                                                                84

32.2     Certificate of the Chief Executive Officer and of University
          Bancorp, Inc. pursuant to 18 U.S.C. Section 1350, as adopted
          pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                      85

32.2     Certificate of the Chief Financial Officer of University
          Bancorp, Inc. pursuant to 18 U.S.C. Section 1350, as adopted
          pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                      86

</TABLE>

<PAGE>



EXHIBIT 23.1
                            Richard C. Woodbury, P.C.
                           Certified Public Accountant
                             20017 E. Sharon Avenue
                             Houghton, MI 49931-1904
                             ----------------------
                              Phone: (906) 482-1305
                               Fax: (906) 482-9555
                      Email: rwoodbury@charterinternet.com
                             Website: www.rcwpc.com
                          INDEPENDENT AUDITOR'S REPORT

         Board of Directors
         Midwest Loan Services, Inc.
         Houghton, MI  49931

         We have audited the accompanying balance sheets of Midwest Loan
         Services, Inc., as of December 31, 2004 and 2003, and the related
         statements of income, retained earnings, and cash flows for the three
         years in the period ended December 31, 2004. These financial statements
         are the responsibility of the Company's management. Our responsibility
         is to express an opinion on these financial statements based on our
         audits.

         We conducted our audits in accordance with the standards of the Public
         Company Accounting Oversight Board (United States). Those standards
         require that we plan and perform the audit to obtain reasonable
         assurance about whether the financial statements are free of material
         misstatement. The Company is not required to have, nor were we engaged
         to perform an audit of its internal control over financial reporting.
         Our audit included consideration of internal control over financial
         reporting as a basis for designing audit procedures that are
         appropriate in the circumstances, but not for the purpose of expressing
         an opinion on the effectiveness of the companies internal control over
         financial reporting. Accordingly, we express no such opinion. An audit
         also includes examining, on a test basis, evidence supporting the
         amounts and disclosures in the financial statements, assessing the
         accounting principles used and significant estimates made by management
         as well as evaluating the overall financial statement presentation. We
         believe that our audit provides a reasonable basis for our opinion.

         In our opinion, the financial statements referred to above present
         fairly, in all material respects, the financial position of Midwest
         Loan Services Inc. as of December 31, 2004 and 2003, and the results of
         its operations and its cash flows for each of the three years in the
         period ended December 31, 2004, in conformity with U.S. generally
         accepted accounting principles.






         Richard C. Woodbury, CPA
         February 25, 2005
<PAGE>

EXHIBIT 23.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


We have issued our report dated March 29, 2005 accompanying the consolidated
financial statements incorporated by reference in the annual report of
University Bancorp, Inc. on Form 10-K for the year ended December 31, 2004. We
hereby consent to the incorporation by reference of said report in the
Registration Statement of University Bancorp, Inc. on Form S-8 (File No. 333-
109930 ) effective October 23, 2003.


/S/ GRANT THORNTON LLP


Southfield, Michigan
April 13, 2005




<PAGE>



EXHIBIT 23.3

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUTING FIRM

We have issued our report dated February 25, 2005 accompanying the consolidated
financial statements incorporated by reference in the annual report of
University Bancorp, Inc. on Form 10-K for the year ended December 31, 2004. We
hereby consent to the incorporation by reference of said report in the
Registration Statement of University Bancorp, Inc. on form S-8 (File No.
333-10993) effective October 23, 2003.

/S/ Richard C. Woodbury, P.C., CPA


Houghton, Michigan
April 13,  2005



<PAGE>



Exhibit 31.1
                           FORM 10-K 302 CERTIFICATION
                                        I
I, Stephen Ranzini certify that:

1)                I have reviewed this annual report on Form 10-K of University
                  Bancorp, Inc.;

2)                Based on my knowledge, this annual report does not contain any
                  untrue statement of a material fact or omit to state a
                  material fact necessary to make the statements made, in light
                  of the circumstances under which such statements were made,
                  not misleading with respect to the period covered by this
                  annual report;

3)                Based on my knowledge, the financial statements, and other
                  financial information included in this annual report, fairly
                  present in all material respects the financial condition,
                  results of operations and cash flows of the registrant as of,
                  and for, the periods presented in this annual report;

4)                The registrant's other certifying officers and I are
                  responsible for establishing and maintaining disclosure
                  controls and procedures (as defined in Exchange Act Rules
                  13a-15(e) and 15d-15(e)) for the registrant and have:

a)                designed such disclosure controls and procedures, or caused
                  such disclosure controls and procedures to be designed under
                  our supervision, to ensure that material information relating
                  to the registrant, including its consolidated subsidiaries, is
                  made known to us by others within those entities, particularly
                  during the period in which this annual report is being
                  prepared;

b)                evaluated the effectiveness of the registrant's disclosure
                  controls and procedures and presented in this report our
                  conclusions about the effectiveness of the disclosure controls
                  and procedures, as of the end of the period covered by this
                  report based on such evaluation; and

c)                disclosed in this report any change in the registrant's
                  internal control over financial reporting that occurred during
                  the registrant's most recent fiscal quarter (the registrant's
                  fourth fiscal quarter in the case of the annual report) that
                  has materially affected, or is reasonably likely to materially
                  affect, the registrant's internal control over financial
                  reporting; and

5.                The registrant's other certifying officers and I have
                  disclosed, based on our most recent evaluation of internal
                  control over financial reporting, to the registrant's auditors
                  and the audit committee of registrant's board of directors (or
                  persons performing the equivalent functions):
a.                all significant deficiencies and material weaknesses in the
                  design or operation of internal control over financial
                  reporting which are reasonably likely to adversely affect the
                  registrant's ability to record, process, summarize and report
                  financial information; and

b.                any fraud, whether or not material, that involves management
                  or other employees who have a significant role in the
                  registrant's internal control over financial reporting. s; and

     Date:  September 27, 2005             /s/Stephen Lange Ranzini
           -------------------            ----------------------------------
                                          Stephen Lange Ranzini
                                          President and Chief Executive Officer
<PAGE>

     Exhibit 31.2
                           FORM 10-K 302 CERTIFICATION

I, Nicholas K. Fortson certify that:

1)                I have reviewed this annual report on Form 10-K of University
                  Bancorp, Inc.;

2)                Based on my knowledge, this annual report does not contain any
                  untrue statement of a material fact or omit to state a
                  material fact necessary to make the statements made, in light
                  of the circumstances under which such statements were made,
                  not misleading with respect to the period covered by this
                  annual report;

3)                Based on my knowledge, the financial statements, and other
                  financial information included in this annual report, fairly
                  present in all material respects the financial condition,
                  results of operations and cash flows of the registrant as of,
                  and for, the periods presented in this annual report;

4)                The registrant's other certifying officers and I are
                  responsible for establishing and maintaining disclosure
                  controls and procedures (as defined in Exchange Act Rules
                  13a-15(e) and 15d-15(e)) for the registrant and have:

d)                designed such disclosure controls and procedures, or caused
                  such disclosure controls and procedures to be designed under
                  our supervision, to ensure that material information relating
                  to the registrant, including its consolidated subsidiaries, is
                  made known to us by others within those entities, particularly
                  during the period in which this annual report is being
                  prepared;

e)                evaluated the effectiveness of the registrant's disclosure
                  controls and procedures and presented in this report our
                  conclusions about the effectiveness of the disclosure controls
                  and procedures, as of the end of the period covered by this
                  report based on such evaluation; and

f)                disclosed in this report any change in the registrant's
                  internal control over financial reporting that occurred during
                  the registrant's most recent fiscal quarter (the registrant's
                  fourth fiscal quarter in the case of the annual report) that
                  has materially affected, or is reasonably likely to materially
                  affect, the registrant's internal control over financial
                  reporting; and

6.                The registrant's other certifying officers and I have
                  disclosed, based on our most recent evaluation of internal
                  control over financial reporting, to the registrant's auditors
                  and the audit committee of registrant's board of directors (or
                  persons performing the equivalent functions):
a.                all significant deficiencies and material weaknesses in the
                  design or operation of internal control over financial
                  reporting which are reasonably likely to adversely affect the
                  registrant's ability to record, process, summarize and report
                  financial information; and

b.                any fraud, whether or not material, that involves management
                  or other employees who have a significant role in the
                  registrant's internal control over financial reporting. s; and


     Date:  September 27, 2005            /s/Nicholas K. Fortson
           -------------------            ----------------------
                                          Nicholas K. Fortson
                                          Chief Financial Officer
<PAGE>

     Exhibit 32.1










                             CERTIFICATION PURSUANT
                           TO 18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the annual report of University Bancorp, Inc. (the
"Registrant") on Form 10-K for the period ended December 31, 2004 as filed with
the Securities and Exchange Commission on September 27, 2005, hereof (the
"Report"), the undersigned officers certify, pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that: (1)
The Report fully complies with the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934, and

(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Registrant.




                                     University Bancorp, Inc


Date: September 27, 2005              By:   /s/ Stephen Lange Ranzini
      ------------------                   --------------------------
                                           Stephen Lange Ranzini
                                           President and Chief Executive Officer



<PAGE>



     Exhibit 32.2


                             CERTIFICATION PURSUANT
                           TO 18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


In connection with the annual report of University Bancorp, Inc. (the
"Registrant") on Form 10-K for the period ended December 31, 2004 as filed with
the Securities and Exchange Commission on September 27, 2005, hereof (the
"Report"), the undersigned officers certify, pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that: (1)
The Report fully complies with the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934, and



(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Registrant.





                                 University Bancorp, Inc



Date:    September 27, 2005         By: /s/ Nicholas K. Fortson
         ------------------             -----------------------
                                        Nicholas K. Fortson
                                        Chief Financial Officer