##### 



Exhibit 13
 
 
 A n n u a l R e p o r tJ u n e 3 0 , 2 0 0 6




---



##### 



2006 
 B o a r d   o f   D i r e c t o r s
 John R. Male
 C. Keith Swaney
 Gerald A. Fallon
 Robert K. Healey
 Ronald D. Holman, II
 Stanley T. Jaros
 Raymond J. Negrelli
 Stuart D. Neidus
 O f f i c e r s
 John R. Male
 C. Keith Swaney
 Jeffrey N. Male
 William J. Harr, Jr.
 Anne M. Johnson
 Carol S. Porter
 Edward B. Debevec
 Mark E. Fosnaught
 Robert L. Katitus
 Adeline Novak
 Robert J. Papa
 J. Thomas Peyton
 John E. Schimmelmann
 Kennaird H. Stewart




---



##### 



Table of ContentsLetter to Shareholders
    
    
    2Full Service Locations
    
    
    4Selected Consolidated Financial and Other Data
    
    
    6Managements Discussion and Analysis of
Financial Condition and Results of Operations
    
    
    8Managements Annual Report on Internal Control
over Financial Reporting
    
    
    21Report of Independent Registered Public Accounting
Firm on Internal Control over Financial Reporting
    
    
    22Report of Independent Registered Public Accounting
Firm on Consolidated Financial Statements
    
    
    24




---



##### 



2006 
 To   O u r   S h a r e h o l d e r s
     2




---



##### 



2006     Sincerely,-s- John R. Male
    
    -s- C. Keith SwaneyJohn R. Male
    
    C. Keith SwaneyChairman of the Board
and Chief Executive Officer
    
    President, Chief Operating Officer
and Treasurer
 (PVF CAPITAL CORP. LOGO)
    
    3




---



##### 



F U L L S E R V I C E L O C A T I O N S Bainbridge Office
8500 Washington St.
Chagrin Falls, OH 44023
Tel: 440-543-8889
Avon Office
36311 Detroit Rd.
Avon, OH 44011
Tel: 440-934-3580
Aurora Office
215 W. Garfield Rd.
Aurora, OH 44202
Tel: 330-562-0620
Beachwood Office
La Place
2111 Richmond Rd.
Beachwood, OH 44122
Tel: 216-831-6373
Bedford Office
413 Northfield Rd.
Bedford, OH 44146
Tel: 440-439-2200
Chardon Office
408 Water St.
Chardon, OH 44024
Tel: 440-285-2343
Lakewood-Cleveland Office
11010 Clifton Blvd.
Cleveland, OH 44102
Tel: 216-631-8900
Macedonia Office
497 East Aurora Rd.
Macedonia, OH 44056
Tel: 330-468-0055
Corporate Center Office
30000 Aurora Rd.
Solon, OH 44139
Tel: 440-914-3900
CLEVELAND
Lakewood
Mentor
90
90
480
480 77
71
80
80
306
Chardon
Beachwood
Shaker Hts.
Mayfield Hts.
Bainbridge
Bedford
North Royalton
Strongsville
Macedonia
Corporate Ctr. Solon
Medina
44
91
82
322
422
Streetsboro
Aurora
4
Avon
480 43
271 4




---



##### 



Mentor Office
Heisley Corners
6990 Heisley Rd.
Mentor, OH 44060
Tel: 440-944-0276
North Royalton Office
13901 Ridge Rd.
North Royalton, OH 44133
Tel: 440-582-7417
Shaker Heights Office
Shaker Towne Centre
16909 Chagrin Blvd.
Shaker Hts., OH 44120
Tel: 216-283-4003
Solon Office
Solar Shopping Center
34400 Aurora Rd.
Solon, OH 44139
Tel: 440-542-6070
Streetsboro Office
9305 Market Square Dr.
Streetsboro, OH 44241
Tel: 330-626-9444
Strongsville Office
17780 Pearl Rd.
Strongsville, OH 44136
Tel: 440-878-6010
Mayfield Heights Office
1244 SOM Center Rd.
Mayfield Hts., OH 44124
Tel: 440-449-8597
Medina Office
Reserve Square
3613 Medina Rd.
Medina, OH 44256
Tel: 330-721-7484
Park View Federals conveniently located full service
branch offices, with ample parking facilities
immediately adjacent to each office, are equipped
with state-of-the-art technology to process any
transaction quickly and efficiently. Our loan officers
and account representatives are available to answer
any questions about our financial products and
services. We pride ourselves on providing our
customers with the best in financial assistance 5




---



##### 



Selected Consolidated Financial and Other Data
 Financial Condition Data:
 At June 30,(dollars in thousands)
    
    2006
    
    2005
    
    2004
    
    2003
    
    2002Total assets
    
    $
    906,081
    
    
    $
    823,899
    
    
    $
    755,687
    
    
    $
    743,404
    
    
    $
    679,620Loans receivable, net
    
    
    736,065
    
    
    
    660,494
    
    
    
    610,681
    
    
    
    576,985
    
    
    
    560,577Loans receivable held for sale, net
    
    
    10,698
    
    
    
    9,060
    
    
    
    11,871
    
    
    
    33,604
    
    
    
    11,680Mortgage-backed securities held to maturity
    
    
    27,578
    
    
    
    31,720
    
    
    
    36,779
    
    
    
    2,931
    
    
    
    7,211Cash and cash equivalents
    
    
    19,738
    
    
    
    11,090
    
    
    
    17,470
    
    
    
    96,751
    
    
    
    14,314Securities
    
    
    58,000
    
    
    
    57,500
    
    
    
    27,500
    
    
    
    33
    
    
    
    55,121Deposits
    
    
    656,864
    
    
    
    591,226
    
    
    
    526,493
    
    
    
    526,429
    
    
    
    479,672Borrowings
    
    
    156,773
    
    
    
    146,413
    
    
    
    147,526
    
    
    
    125,938
    
    
    
    129,028Stockholders equity
    
    
    68,973
    
    
    
    66,453
    
    
    
    63,361
    
    
    
    58,603
    
    
    
    52,299
 Operating Data:
 Year Ended June 30,(dollars in thousands except for earnings per share)
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002Interest income
    
    $
    55,179
    
    
    $
    43,595
    
    
    $
    39,109
    
    
    $
    43,482
    
    
    $
    48,814Interest expense
    
    
    28,408
    
    
    
    19,801
    
    
    
    16,739
    
    
    
    20,646
    
    
    
    27,060Net interest income
before provision for loan losses
    
    
    26,771
    
    
    
    23,794
    
    
    
    22,370
    
    
    
    22,836
    
    
    
    21,754Provision for loan losses
    
    
    826
    
    
    
    111
    
    
    
    597
    
    
    
    0
    
    
    
    558Net interest income
after provision for loan losses
    
    
    25,945
    
    
    
    23,683
    
    
    
    21,773
    
    
    
    22,836
    
    
    
    21,196Non-interest income
    
    
    2,500
    
    
    
    3,374
    
    
    
    6,130
    
    
    
    5,893
    
    
    
    3,751Non-interest expense
    
    
    21,549
    
    
    
    18,942
    
    
    
    17,571
    
    
    
    16,509
    
    
    
    14,139Income before federal income taxes
    
    
    6,896
    
    
    
    8,115
    
    
    
    10,332
    
    
    
    12,220
    
    
    
    10,808Federal income taxes
    
    
    2,053
    
    
    
    2,531
    
    
    
    3,422
    
    
    
    4,124
    
    
    
    3,635Net income
    
    $
    4,843
    
    
    $
    5,584
    
    
    $
    6,910
    
    
    $
    8,096
    
    
    $
    7,173Basic earnings per share (1)
    
    $
    0.63
    
    
    $
    0.72
    
    
    $
    0.89
    
    
    $
    1.05
    
    
    $
    0.93Diluted earnings per share (1)
    
    $
    0.62
    
    
    $
    0.71
    
    
    $
    0.87
    
    
    $
    1.03
    
    
    $
    0.91
 
 (1)
    
    Adjusted for stock dividends. 6
    

(PVF  CAPITAL  CORP.  LOGO)




---



##### 



Other Data:
 At or For the Year Ended June 30,2006
    
    2005
    
    2004
    
    2003
    
    2002Return on average assets
    
    
    0.56
    %
    
    
    0.70
    %
    
    
    0.96
    %
    
    
    1.15
    %
    
    
    1.03
    %Return on average equity
    
    
    7.15
    %
    
    
    8.62
    %
    
    
    11.26
    %
    
    
    14.60
    %
    
    
    14.19
    %Interest rate spread
    
    
    3.09
    %
    
    
    3.07
    %
    
    
    3.12
    %
    
    
    3.13
    %
    
    
    2.95
    %Net interest margin
    
    
    3.28
    %
    
    
    3.19
    %
    
    
    3.31
    %
    
    
    3.37
    %
    
    
    3.26
    %Average
interest-earning
assets to average

interest-bearing
liabilities
    
    
    105.38
    %
    
    
    104.81
    %
    
    
    107.62
    %
    
    
    108.10
    %
    
    
    107.64
    %Non-accruing loans and repossessed assets to total assets
    
    
    1.80
    %
    
    
    1.59
    %
    
    
    1.42
    %
    
    
    1.06
    %
    
    
    1.23
    %Stockholders equity to total assets
    
    
    7.61
    %
    
    
    8.07
    %
    
    
    8.38
    %
    
    
    7.88
    %
    
    
    7.70
    %Ratio of average equity to average assets
    
    
    7.78
    %
    
    
    8.16
    %
    
    
    8.49
    %
    
    
    7.86
    %
    
    
    7.24
    %Dividend payout ratio (cash dividends declared divided by net
income)
    
    
    47.13
    %
    
    
    37.37
    %
    
    
    33.71
    %
    
    
    21.21
    %
    
    
    21.76
    %
 Bank Regulatory Capital Ratios:
 Ratio of tangible capital to adjusted total assets
    
    
    8.33
    %
    
    
    8.77
    %
    
    
    7.97
    %
    
    
    7.73
    %
    
    
    7.88
    %Ratio of Tier-1 core capital to adjusted total assets
    
    
    8.33
    %
    
    
    8.77
    %
    
    
    7.97
    %
    
    
    7.73
    %
    
    
    7.88
    %Ratio of Tier-1 risk-based capital to risk-weighted assets
    
    
    9.72
    %
    
    
    10.41
    %
    
    
    9.54
    %
    
    
    9.92
    %
    
    
    10.84
    %Ratio of Total risk-based capital to risk-weighted assets
    
    
    10.28
    %
    
    
    10.97
    %
    
    
    10.19
    %
    
    
    10.55
    %
    
    
    11.63
    %
 (PVF  CAPITAL  CORP.  LOGO)
    
    7




---



##### 



Managements Discussion and Analysis of Financial Condition and Results of Operations
 General
 single-family
 Forward-Looking Statements
   Overview of Financial Condition at June 30, 2006, 2005 and 2004
  
 8




---



##### 



(dollars in thousands)
    
    2006
    
    2005
    
    2004One-to-four family residential
    
    $
    174,575
    
    
    $
    148,956
    
    
    $
    128,210Home equity line of credit
    
    
    94,450
    
    
    
    97,692
    
    
    
    83,505Multi-family residential
    
    
    45,716
    
    
    
    33,504
    
    
    
    38,777Commercial
    
    
    170,392
    
    
    
    171,331
    
    
    
    175,323Commercial equity line of credit
    
    
    34,064
    
    
    
    31,875
    
    
    
    38,113Land
    
    
    77,242
    
    
    
    68,165
    
    
    
    54,047Construction  residential
    
    
    84,146
    
    
    
    75,460
    
    
    
    70,833Construction  multi-family
    
    
    7,956
    
    
    
    0
    
    
    
    0Construction  commercial
    
    
    33,756
    
    
    
    24,355
    
    
    
    15,679Total real estate mortgages
    
    
    722,297
    
    
    
    651,339
    
    
    
    604,487Non real estate mortgages
    
    
    21,824
    
    
    
    17,300
    
    
    
    13,951Total loans receivable
    
    
    744,121
    
    
    
    668,639
    
    
    
    618,438Net deferred loan origination fees
    
    
    (3,382
    )
    
    
    (3,833
    )
    
    
    (3,380
    )Allowance for loan losses
    
    
    (4,675
    )
    
    
    (4,312
    )
    
    
    (4,377
    )Total loans receivable, net
    
    $
    736,065
    
    
    $
    660,494
    
    
    $
    610,681Loans receivable held for sale, net
    
    $
    10,698
    
    
    $
    9,060
    
    
    $
    11,871Mortgage-backed securities held to maturity
    
    $
    27,578
    
    
    $
    31,720
    
    
    $
    36,779
     (dollars in thousands)
    
    2006
    
    
    2005
    
    
    2004Now accounts
    
    $
    39,565
    
    
    $
    38,319
    
    
    $
    38,578Passbook savings
    
    
    35,194
    
    
    
    43,415
    
    
    
    46,726Money market accounts
    
    
    60,900
    
    
    
    22,952
    
    
    
    20,477Non-interest bearing
    
    
    17,069
    
    
    
    16,958
    
    
    
    16,429Certificates of deposit
    
    
    504,316
    
    
    
    469,582
    
    
    
    404,283Total deposits
    
    $
    656,864
    
    
    $
    591,226
    
    
    $
    526,493
  (PVF  CAPITAL  CORP.  LOGO)
    
    9




---



##### 



Capital
   Park View
    
    
    
    
    
    Requirement forFederal
    
    Percent of
    
    Well-Capitalized(dollars in thousands)
    
    Capital
    
    Assets (1)
    
    InstitutionTangible capital
    
    $
    75,827
    
    
    
    8.33
    %
    
    
    N/ATier-1 core capital
    
    $
    75,827
    
    
    
    8.33
    %
    
    
    5.00
    %Tier-1 risk-based capital
    
    $
    75,827
    
    
    
    9.72
    %
    
    
    6.00
    %Total risk-based capital
    
    $
    80,241
    
    
    
    10.28
    %
    
    
    10.00
    %
 
 (1)
    
    Tangible and core capital levels are shown as a percentage of total adjusted assets;
risk-based capital levels are shown as a percentage of risk-weighted assets. Common Stock and Dividends
   (1)
 Fiscal 2006
    
    Fiscal 2005High Bid
    
    Low Bid
    
    High Bid
    
    Low BidFourth Quarter
    
    $
    10.22
    
    
    $
    9.00
    
    
    $
    14.33
    
    
    $
    10.11Third Quarter
    
    
    11.30
    
    
    
    9.73
    
    
    
    12.73
    
    
    
    10.91Second Quarter
    
    
    11.56
    
    
    
    10.38
    
    
    
    13.22
    
    
    
    11.43First Quarter
    
    
    13.33
    
    
    
    10.54
    
    
    
    14.47
    
    
    
    12.50
 
 (1)
    
    Quotations reflect inter-dealer prices without retail mark-up, mark-down
or commission, and may not represent actual transactions. Bid prices
have been adjusted to reflect the previously described stock dividends. Liquidity and Capital Resources
   10
    

(PVF CAPITAL CORP. LOGO)




---



##### 



Profile
of Interest Earning Assets
 
 Profile of Interest Earning Assets
1.8% Fixed-rate other mortgage loans
3.1% Fixed-rate mortgage-backed securities
37.2% Adjustable-rate single-family mortgage loans
10.2% Other interest-earning assets
41.7% Adjustable-rate other mortgage loans
3.9% Fixed-rate single-family mortgage loans
2.1% Non real estate loans   Market Risk Management
     Profile of Interest Bearing Liabilities
 
 Profile of Interest Bearing Liabilities
1.9% CDs over 36 months
55.5% CDs 12 months or less
1.0% CDs 25 to 36 months
4.9% CDs 13 to 24 months
12.6% Transaction accounts
10.0% FHLB advances and other
borrowings greater than 3 months
9.7% FHLB advances and other
borrowings 3 months or less
4.4% Passbook accounts (PVF  CAPITAL  CORP.  LOGO)
    
    11




---



##### 



(dollars in thousands)
    
    June 30, 2006
    
    June 30, 2005Change in
    
    Market Value of
    
    Dollar
    
    NPV
    
    Market Value of
    
    Dollar
    
    NPVInterest Rates
    
    Portfolio Equity
    
    Change
    
    Ratio
    
    Portfolio Equity
    
    Change
    
    Ratio+2%
    
    $
    85,142
    
    
    $
    (10,181
    )
    
    
    9.37
    %
    
    $
    87,343
    
    
    $
    (5,011
    )
    
    
    10.44
    %+1%
    
    
    90,340
    
    
    
    ( 4,983
    )
    
    
    9.85
    
    
    
    91,084
    
    
    
    (1,270
    )
    
    
    10.790
    
    
    95,323
    
    
    
    
    
    
    
    10.29
    
    
    
    92,354
    
    
    
    
    
    
    
    10.85-1%
    
    
    98,892
    
    
    
    3,569
    
    
    
    10.59
    
    
    
    88,401
    
    
    
    (3,953
    )
    
    
    10.34-2%
    
    
    98,438
    
    
    
    3,115
    
    
    
    10.50
    
    
    
    80,987
    
    
    
    (11,367
    )
    
    
    9.45
     12
    

(PVF  CAPITAL  CORP.  LOGO)




---



##### 



Within
    
    1-3
    
    3-5
    
    >5(dollars in thousands)
    
    1 Year
    
    Years
    
    Years
    
    Years
    
    TotalTotal interest-rate-sensitive assets
    
    $
    428,101
    
    
    $
    176,262
    
    
    $
    188,175
    
    
    $
    69,266
    
    
    $
    861,804Total interest-rate-sensitive liabilities
    
    
    528,499
    
    
    
    148,328
    
    
    
    92,454
    
    
    
    27,287
    
    
    
    796,568Periodic GAP
    
    
    (100,398
    )
    
    
    27,934
    
    
    
    95,721
    
    
    
    41,979
    
    
    
    65,236Cumulative GAP
    
    
    (100,398
    )
    
    
    (72,464
    )
    
    
    23,257
    
    
    
    65,236Ratio of cumulative GAP to total assets
    
    
    (11.1
    %)
    
    
    (8.0
    %)
    
    
    2.6
    %
    
    
    7.2
    %
 Commitments, Contingencies and Off-Balance Sheet Risk
   June 30,(dollars in thousands)
    
    2006
    
    2005Commitments to originate:Mortgage loans intended for sale
    
    $
    31,524
    
    
    $
    43,912Mortgage loans held for investment
    
    
    48,287
    
    
    
    29,798Unfunded home equity and
commercial real estate lines of credit
    
    
    92,901
    
    
    
    79,452Undisbursed portion of loan proceeds
    
    
    66,749
    
    
    
    69,715Commitments to sell loans held for sale
    
    
    13,250
    
    
    
    17,881Standby letters of credit
    
    
    3,547
    
    
    
    8,903
 
 13




---



##### 



Note
    
    Within
    
    1-3
    
    3-5
    
    >5(dollars in thousands)
    
    Reference
    
    1 Year
    
    Years
    
    Years
    
    Years
    
    TotalDeposits without a stated maturity
    
    
    
    
    
    $
    152,728
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    152,728Certificates of deposit
    
    
    7
    
    
    
    441,726
    
    
    
    46,933
    
    
    
    15,477
    
    
    
    
    
    
    
    504,136Long-term advances from
the FHLB of Cincinnati
    
    
    8
    
    
    
    
    
    
    
    20,000
    
    
    
    
    
    
    
    
    
    
    
    20,000Repurchase agreement
    
    
    9
    
    
    
    
    
    
    
    
    
    
    
    50,000
    
    
    
    
    
    
    
    50,000Subordinated debt
    
    
    9
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,000
    
    
    
    10,000Operating leases
    
    
    11
    
    
    
    884
    
    
    
    1,612
    
    
    
    1,003
    
    
    
    527
    
    
    
    4,026
 Results of Operations
 General
  
 Net Interest Income
   
 14




---



##### 



Table 1
    
    Average Balances, Interest, and Average Yields and RatesFor the Year Ended June 30,2006
    
    
    2005
    
    
    2004Average
    
    
    
    
    
    
    Yield/
    
    
    Average
    
    
    
    
    
    
    Yield/
    
    
    Average
    
    
    
    
    
    
    Yield/(dollars in thousands)
    
    Balance
    
    
    Interest
    
    
    Cost
    
    
    Balance
    
    
    Interest
    
    
    Cost
    
    
    Balance
    
    
    Interest
    
    
    CostInterest-earning assets:Loans
    
    $
    709,789
    
    
    $
    50,514
    
    
    
    7.12
    %
    
    $
    649,305
    
    
    $
    39,825
    
    
    
    6.13
    %
    
    $
    610,081
    
    
    $
    36,605
    
    
    
    6.00
    %Mortgage-backed securities
    
    
    29,013
    
    
    
    1,386
    
    
    
    4.78
    
    
    
    34,199
    
    
    
    1,655
    
    
    
    4.84
    
    
    
    39,180
    
    
    
    1,860
    
    
    
    4.75Securities and other interest-earning assets
    
    
    77,989
    
    
    
    3,279
    
    
    
    4.20
    
    
    
    61,747
    
    
    
    2,115
    
    
    
    3.43
    
    
    
    27,538
    
    
    
    645
    
    
    
    2.34Total interest-earning assets
    
    
    816,791
    
    
    
    55,179
    
    
    
    6.75
    
    
    
    745,251
    
    
    
    43,595
    
    
    
    5.85
    
    
    
    676,799
    
    
    
    39,110
    
    
    
    5.78Non-interest-earning assets
    
    
    53,338
    
    
    
    
    
    
    
    
    
    
    
    48,343
    
    
    
    
    
    
    
    
    
    
    
    46,232Total assets
    
    $
    870,129
    
    
    
    
    
    
    
    
    
    
    $
    793,594
    
    
    
    
    
    
    
    
    
    
    $
    723,031Interest-bearing liabilities:Deposits
    
    $
    609,685
    
    
    $
    20,777
    
    
    
    3.41
    %
    
    $
    537,874
    
    
    $
    13,133
    
    
    
    2.44
    %
    
    $
    497,803
    
    
    $
    11,351
    
    
    
    2.28
    %Borrowings
    
    
    165,441
    
    
    
    7,631
    
    
    
    4.61
    
    
    
    173,205
    
    
    
    6,668
    
    
    
    3.85
    
    
    
    131,069
    
    
    
    5,389
    
    
    
    4.11Total interest-bearing liabilities
    
    
    775,126
    
    
    
    28,408
    
    
    
    3.66
    
    
    
    711,079
    
    
    
    19,801
    
    
    
    2.78
    
    
    
    628,872
    
    
    
    16,740
    
    
    
    2.66Non-interest-bearing liabilities
    
    
    27,296
    
    
    
    
    
    
    
    
    
    
    
    17,723
    
    
    
    
    
    
    
    
    
    
    
    32,780Total liabilities
    
    
    802,422
    
    
    
    
    
    
    
    
    
    
    
    728,802
    
    
    
    
    
    
    
    
    
    
    
    661,652Stockholders equity
    
    
    67,707
    
    
    
    
    
    
    
    
    
    
    
    64,792
    
    
    
    
    
    
    
    
    
    
    
    61,379Total liabilities and stockholders equity
    
    $
    870,129
    
    
    
    
    
    
    
    
    
    
    $
    793,594
    
    
    
    
    
    
    
    
    
    
    $
    723,031Net interest income
    
    
    
    
    
    $
    26,771
    
    
    
    
    
    
    
    
    
    
    $
    23,794
    
    
    
    
    
    
    
    
    
    
    $
    22,370Interest rate spread
    
    
    
    
    
    
    
    
    
    
    3.09
    %
    
    
    
    
    
    
    
    
    
    
    3.07
    %
    
    
    
    
    
    
    
    
    
    
    3.12
    %Net yield on interest-earning assets
    
    
    
    
    
    
    
    
    
    
    3.28
    %
    
    
    
    
    
    
    
    
    
    
    3.19
    %
    
    
    
    
    
    
    
    
    
    
    3.31
    %Ratio of average interest-earning assets
to average interest-bearing liabilities
    
    
    105.38
    %
    
    
    
    
    
    
    
    
    
    
    104.81
    %
    
    
    
    
    
    
    
    
    
    
    107.62
    %
 
 15




---



##### 



Table
2
    
    Year Ended June 30,2006
    
    
    vs.
    
    
    2005
    
    
    2005
    
    
    vs.
    
    
    2004Increase (Decrease)
    
    
    Increase (Decrease)Due to
    
    
    Due to(dollars in thousands)
    
    Volume
    
    
    Rate
    
    
    Total
    
    
    Volume
    
    
    Rate
    
    
    TotalInterest income:Loans
    
    $
    3,930
    
    
    $
    6,759
    
    
    $
    10,689
    
    
    $
    2,392
    
    
    $
    829
    
    
    $
    3,220Mortgage-backed securities
    
    
    (248
    )
    
    
    (21
    )
    
    
    (269
    )
    
    
    (241
    )
    
    
    35
    
    
    
    (205
    )Securities and other interest-earning assets
    
    
    624
    
    
    
    540
    
    
    
    1,164
    
    
    
    1,071
    
    
    
    399
    
    
    
    1,470Total interest-earning assets
    
    
    4,306
    
    
    
    7,278
    
    
    
    11,584
    
    
    
    3,222
    
    
    
    1,263
    
    
    
    4,485Interest expense:Deposits
    
    
    1,927
    
    
    
    5,717
    
    
    
    7,644
    
    
    
    949
    
    
    
    833
    
    
    
    1,782Borrowings
    
    
    (309
    )
    
    
    1,272
    
    
    
    963
    
    
    
    1,695
    
    
    
    (416
    )
    
    
    1,279Total interest-bearing liabilities
    
    
    1,618
    
    
    
    6,989
    
    
    
    8,607
    
    
    
    2,644
    
    
    
    417
    
    
    
    3,061Net interest income
    
    $
    2,688
    
    
    $
    289
    
    
    $
    2,977
    
    
    $
    578
    
    
    $
    846
    
    
    $
    1,424
    Provision for Loan Losses
   
 16




---



##### 



2006
    
    
    2005More than
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    More than90 days and
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    90 days andPerforming
    
    
    accruing
    
    
    Non-accruing
    
    
    Total
    
    
    Performing
    
    
    accruing
    
    
    Non-accruing
    
    
    TotalOne-to-four family residential
    
    $
    124,401
    
    
    $
    
    
    
    $
    4,732,215
    
    
    $
    4,856,616
    
    
    $
    1,086,330
    
    
    $
    
    
    
    $
    3,157,053
    
    
    $
    4,243,383Home equity line of credit
    
    
    124,363
    
    
    
    
    
    
    
    2,593,797
    
    
    
    2,718,160
    
    
    
    378,214
    
    
    
    162,975
    
    
    
    1,768,462
    
    
    
    2,309,651Multi-family residential
    
    
    
    
    
    
    
    
    
    
    21,300
    
    
    
    21,300
    
    
    
    319,393
    
    
    
    
    
    
    
    
    
    
    
    319,393Commercial real estate
    
    
    
    
    
    
    
    
    
    
    2,480,794
    
    
    
    2,480,794
    
    
    
    1,210,406
    
    
    
    
    
    
    
    3,353,962
    
    
    
    4,564,368Land
    
    
    
    
    
    
    
    
    
    
    1,188,659
    
    
    
    1,188,659
    
    
    
    141,651
    
    
    
    
    
    
    
    276,427
    
    
    
    418,078Residential construction
    
    
    175,000
    
    
    
    
    
    
    
    3,687,350
    
    
    
    3,862,350
    
    
    
    
    
    
    
    270,000
    
    
    
    256,000
    
    
    
    526,000Total classified real estate loans
    
    
    423,764
    
    
    
    
    
    
    
    14,704,115
    
    
    
    15,127,879
    
    
    
    3,135,994
    
    
    
    432,975
    
    
    
    8,811,904
    
    
    
    12,380,873Non real estate loans
    
    
    59,810
    
    
    
    
    
    
    
    
    
    
    
    59,810
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total classified loans
    
    $
    483,574
    
    
    $
    
    
    
    $
    14,704,115
    
    
    $
    15,187,689
    
    
    $
    3,135,994
    
    
    $
    432,975
    
    
    $
    8,811,904
    
    
    $
    12,380,873
  
 17




---



##### 



Non-interest Income
  Non-interest Expense
  Federal Income Taxes
  Impact of Inflation and Changing Prices
  
 18




---



##### 



Critical Accounting Policies and Estimates
 
   
 19




---



##### 



O
f f i c e    L o c a t i o n s
 a
n d    H o u r s
 Aurora Office
 Avon Office
 Bainbridge Office
 Beachwood Office
 Bedford Office
 Chardon Office
 Lakewood-Cleveland Office
 Macedonia Office
 Mayfield Heights Office
 Medina Office
 Mentor Office
 North Royalton Office
 Solon Office
 Streetsboro Office
 Strongsville Office
 LOBBY
Mon., Tues., Wed., Thurs.:   Friday:  Saturday:
 AUTO TELLER
Mon., Tues., Wed., Thurs.:   Friday:  Saturday:
 Shaker Heights Office
 LOBBY
Mon., Tues., Wed., Thurs.:   Friday :  Saturday:
 Corporate Center Office
 LOBBY & AUTO TELLER
Monday  Friday:   Closed Saturday
 20




---



##### 



-s- John R. Male
    
    -s- C. Keith SwaneyJohn R. Male
    
    C. Keith SwaneyChairman of the Board
    
    President, Chief Operating Officerand Chief Executive Officer
    
    and Treasurer
 21




---



##### 



Internal ControlIntegrated Framework
   22




---



##### 



23




---



##### 



Internal Control  Integrated
Framework
 
 
 24




---



##### 



2006
    
    
    2005ASSETSCash and amounts due from depository institutions
    
    $
    6,614,171
    
    
    $
    4,034,353Interest bearing deposits
    
    
    1,804,098
    
    
    
    2,180,723Federal funds sold
    
    
    11,320,000
    
    
    
    4,875,000Cash and cash equivalents
    
    
    19,738,269
    
    
    
    11,090,076Securities held to maturity (fair values of $57,256,642 and
$57,345,425, respectively)
    
    
    58,000,000
    
    
    
    57,500,000Mortgage-backed securities held to maturity (fair values
of $25,761,813 and $31,487,772, respectively)
    
    
    27,577,923
    
    
    
    31,720,033Loans receivable held for sale, net
    
    
    10,698,064
    
    
    
    9,059,647Loans receivable, net of allowance of
$4,674,681 and $4,312,274
    
    
    736,064,995
    
    
    
    660,494,144Office properties and equipment, net
    
    
    12,032,692
    
    
    
    13,413,231Real estate owned
    
    
    817,279
    
    
    
    1,319,251Federal Home Loan Bank stock
    
    
    11,955,000
    
    
    
    11,316,400Prepaid expenses and other assets
    
    
    29,197,159
    
    
    
    27,985,916Total assets
    
    $
    906,081,381
    
    
    $
    823,898,698LIABILITIES AND STOCKHOLDERS EQUITYDeposits
    
    $
    656,864,201
    
    
    $
    591,226,478Short-term advances from the FHLB
    
    
    75,000,000
    
    
    
    15,000,000Line of credit
    
    
    1,772,871
    
    
    
    Long-term advances from the FHLB
    
    
    20,000,000
    
    
    
    120,012,018Repurchase agreement
    
    
    50,000,000
    
    
    
    Notes payable
    
    
    
    
    
    
    1,400,780Subordinated debentures
    
    
    10,000,000
    
    
    
    10,000,000Advances from borrowers for taxes and insurance
    
    
    8,102,098
    
    
    
    3,184,981Accrued expenses and other liabilities
    
    
    15,369,071
    
    
    
    16,621,262Total liabilities
    
    
    837,108,241
    
    
    
    757,445,519Commitments and contingenciesStockholders equitySerial preferred stock, $.01 par value, 1,000,000 shares
authorized; none issued
    
    
    
    
    
    
    Common
stock, $.01 par value, 15,000,000 shares
authorized; 8,188,867 and 8,175,779 shares issued,
respectively
    
    
    81,889
    
    
    
    81,758Additional paid-in capital
    
    
    68,507,097
    
    
    
    68,288,834Retained earnings
    
    
    4,221,301
    
    
    
    1,663,992Treasury stock, at cost, 472,725 and
451,088 shares, respectively
    
    
    (3,837,147
    )
    
    
    (3,581,405
    )Total stockholders equity
    
    
    68,973,140
    
    
    
    66,453,179Total liabilities and stockholders equity
    
    $
    906,081,381
    
    
    $
    823,898,698
  25




---



##### 



2006
    
    
    2005
    
    
    2004Interest and dividends incomeLoans
    
    $
    50,513,550
    
    
    $
    39,825,656
    
    
    $
    36,604,621Mortgage-backed securities
    
    
    1,385,572
    
    
    
    1,654,537
    
    
    
    1,860,224Federal Home Loan Bank stock dividends
    
    
    638,807
    
    
    
    491,125
    
    
    
    429,402Securities
    
    
    2,273,566
    
    
    
    1,493,167
    
    
    
    111,443Fed funds sold and interest-bearing deposits
    
    
    367,080
    
    
    
    130,354
    
    
    
    103,951Total interest income
    
    
    55,178,575
    
    
    
    43,594,839
    
    
    
    39,109,641Interest expenseDeposits
    
    
    20,776,397
    
    
    
    13,133,468
    
    
    
    11,351,365Short-term borrowings
    
    
    2,816,260
    
    
    
    934,738
    
    
    
    124,651Long-term borrowings
    
    
    4,121,641
    
    
    
    5,229,070
    
    
    
    5,260,897Subordinated debt
    
    
    693,292
    
    
    
    503,190
    
    
    
    2,301Total interest expense
    
    
    28,407,590
    
    
    
    19,800,466
    
    
    
    16,739,214Net interest income
    
    
    26,770,985
    
    
    
    23,794,373
    
    
    
    22,370,427Provision for loan losses
    
    
    826,300
    
    
    
    111,000
    
    
    
    597,300Net interest income after provision
for loan losses
    
    
    25,944,685
    
    
    
    23,683,373
    
    
    
    21,773,127Noninterest incomeService charges and other fees
    
    
    1,081,021
    
    
    
    838,470
    
    
    
    660,646Mortgage banking activities, net
    
    
    834,471
    
    
    
    1,311,235
    
    
    
    4,632,561Gain (loss) on disposal of real estate owned
    
    
    (35,330
    )
    
    
    165,575
    
    
    
    488,839Increase in cash surrender value of
bank-owned life insurance
    
    
    597,447
    
    
    
    554,405
    
    
    
    187,533Other, net
    
    
    22,606
    
    
    
    504,558
    
    
    
    160,177Total noninterest income
    
    
    2,500,215
    
    
    
    3,374,243
    
    
    
    6,129,756Noninterest expenseCompensation and benefits
    
    
    12,060,345
    
    
    
    10,835,446
    
    
    
    9,590,924Office, occupancy, and equipment
    
    
    3,815,592
    
    
    
    3,670,437
    
    
    
    3,394,285Insurance
    
    
    295,724
    
    
    
    235,692
    
    
    
    232,926Professional and legal
    
    
    492,061
    
    
    
    339,050
    
    
    
    397,179Advertising
    
    
    572,477
    
    
    
    382,689
    
    
    
    373,702Outside services
    
    
    1,430,915
    
    
    
    776,801
    
    
    
    876,799Franchise tax
    
    
    881,691
    
    
    
    773,308
    
    
    
    728,400Other
    
    
    2,000,595
    
    
    
    1,929,080
    
    
    
    1,977,065Total noninterest expense
    
    
    21,549,400
    
    
    
    18,942,503
    
    
    
    17,571,280Income before federal income taxes
    
    
    6,895,500
    
    
    
    8,115,113
    
    
    
    10,331,603Federal income taxesCurrent
    
    
    2,323,692
    
    
    
    2,413,291
    
    
    
    2,287,524Deferred
    
    
    (271,193
    )
    
    
    117,701
    
    
    
    1,134,0252,052,499
    
    
    
    2,530,992
    
    
    
    3,421,549Net income
    
    $
    4,843,001
    
    
    $
    5,584,121
    
    
    $
    6,910,054Basic earnings per share
    
    $
    0.63
    
    
    $
    0.72
    
    
    $
    0.89Diluted earnings per share
    
    $
    0.62
    
    
    $
    0.71
    
    
    $
    0.87
  26




---



##### 



AdditionalCommon
    
    
    paid-in
    
    
    Retained
    
    
    Treasurystock
    
    
    capital
    
    
    earnings
    
    
    stock
    
    
    TotalBalance at June 30, 2003
    
    
    67,173
    
    
    
    47,176,696
    
    
    
    14,486,460
    
    
    
    (3,127,193
    )
    
    
    58,603,136Net income
    
    
    
    
    
    
    
    
    
    
    6,910,054
    
    
    
    
    
    
    
    6,910,054Stock options exercised, 34,580 shares
    
    
    346
    
    
    
    256,447
    
    
    
    
    
    
    
    
    
    
    
    256,793Stock purchased and retired,
6,373 shares
    
    
    (64
    )
    
    
    (94,147
    )
    
    
    
    
    
    
    
    
    
    
    (94,211
    )Cash paid in lieu of fractional shares
    
    
    
    
    
    
    
    
    
    
    (2,814
    )
    
    
    
    
    
    
    (2,814
    )Stock dividend issued, 674,555 shares
    
    
    6,745
    
    
    
    11,039,093
    
    
    
    (11,045,838
    )
    
    
    
    
    
    
    Cash dividend, $0.300 per share
    
    
    
    
    
    
    
    
    
    
    (2,312,015
    )
    
    
    
    
    
    
    (2,312,015
    )Balance at June 30, 2004
    
    
    74,200
    
    
    
    58,378,089
    
    
    
    8,035,847
    
    
    
    (3,127,193
    )
    
    
    63,360,943Net income
    
    
    
    
    
    
    
    
    
    
    5,584,121
    
    
    
    
    
    
    
    5,584,121Stock options exercised, 21,712 shares
    
    
    217
    
    
    
    166,029
    
    
    
    
    
    
    
    
    
    
    
    166,246Stock purchased and retired,
9,024 shares
    
    
    (90
    )
    
    
    (122,934
    )
    
    
    
    
    
    
    
    
    
    
    (123,024
    )Cash paid in lieu of fractional shares
    
    
    
    
    
    
    
    
    
    
    (3,488
    )
    
    
    
    
    
    
    (3,488
    )Stock dividend issued, 743,046 shares
    
    
    7,431
    
    
    
    9,867,650
    
    
    
    (9,875,081
    )
    
    
    
    
    
    
    Cash dividend, $0.269 per share
    
    
    
    
    
    
    
    
    
    
    (2,077,407
    )
    
    
    
    
    
    
    (2,077,407
    )Purchase of 32,210 shares of
treasury stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (454,212
    )
    
    
    (454,212
    )Balance at June 30, 2005
    
    $
    81,758
    
    
    $
    68,288,834
    
    
    $
    1,663,992
    
    
    $
    (3,581,405
    )
    
    $
    66,453,179Net income
    
    
    
    
    
    
    
    
    
    
    4,843,001
    
    
    
    
    
    
    
    4,843,001Stock options exercised, 26,038 shares
    
    
    260
    
    
    
    144,477
    
    
    
    
    
    
    
    
    
    
    
    144,737Stock purchased and retired,
12,950 shares
    
    
    (129
    )
    
    
    (140,975
    )
    
    
    
    
    
    
    
    
    
    
    (141,104
    )Cash paid in lieu of fractional shares
    
    
    
    
    
    
    
    
    
    
    (3,022
    )
    
    
    
    
    
    
    (3,022
    )Cash dividend, $0.296 per share
    
    
    
    
    
    
    
    
    
    
    (2,282,670
    )
    
    
    
    
    
    
    (2,282,670
    )Purchase of 21,637 shares of
treasury stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (255,742
    )
    
    
    (255,742
    )Paid in capital related to stock
based compensation
    
    
    
    
    
    
    214,761
    
    
    
    
    
    
    
    
    
    
    
    214,761Balance at June 30, 2006
    
    $
    81,889
    
    
    $
    68,507,097
    
    
    $
    4,221,301
    
    
    $
    (3,837,147
    )
    
    $
    68,973,140
  27




---



##### 



2006
    
    
    2005
    
    
    2004Operating activities:Net income
    
    $
    4,843,001
    
    
    $
    5,584,121
    
    
    $
    6,910,054Adjustments required to reconcile net
income to net cash from operating activitiesAmortization of premium on
mortgage-backed securities
    
    
    46,883
    
    
    
    26,471
    
    
    
    72,548Depreciation
    
    
    1,816,028
    
    
    
    1,863,375
    
    
    
    1,658,958Provision for loan losses
    
    
    826,300
    
    
    
    111,000
    
    
    
    597,300Accretion of deferred loan
origination fees, net
    
    
    (2,072,972
    )
    
    
    (1,007,937
    )
    
    
    (1,108,263
    )(Gain)/loss on disposal of real estate owned
    
    
    35,330
    
    
    
    (165,575
    )
    
    
    (488,839
    )Market adjustments for loans held for sale
    
    
    156,000
    
    
    
    
    
    
    
    Change in fair value of mortgage
banking derivatives
    
    
    239,000
    
    
    
    15,000
    
    
    
    Stock compensation
    
    
    214,761
    
    
    
    
    
    
    
    FHLB stock dividends
    
    
    (638,600
    )
    
    
    (490,800
    )
    
    
    (429,201
    )Deferred income tax provision
    
    
    (271,193
    )
    
    
    117,701
    
    
    
    1,134,025Proceeds from loans held for sale
    
    
    104,648,344
    
    
    
    118,420,611
    
    
    
    301,018,063Originations of loans held for sale
    
    
    (107,212,344
    )
    
    
    (115,813,850
    )
    
    
    (277,787,331
    )Gain on the sale of loans, net
    
    
    (633,782
    )
    
    
    (1,095,039
    )
    
    
    (5,260,163
    )Net change in other assets
and other liabilities
    
    
    (946,126
    )
    
    
    433,489
    
    
    
    (7,841,279
    )Net cash from operating activities
    
    
    1,050,630
    
    
    
    7,998,567
    
    
    
    18,475,872Investing activities:Loans originated
    
    
    (243,702,577
    )
    
    
    (216,290,237
    )
    
    
    (137,580,380
    )Principal repayments on loans
    
    
    168,059,591
    
    
    
    164,871,379
    
    
    
    104,195,639Principal repayments on mortgage-backed securities held to maturity
    
    
    5,201,834
    
    
    
    6,085,195
    
    
    
    5,932,009Purchase of mortgage-backed securities
held to maturity
    
    
    (1,106,607
    )
    
    
    (1,052,410
    )
    
    
    (39,853,303
    )Purchase of securities held to maturity
    
    
    (500,000
    )
    
    
    (35,000,000
    )
    
    
    (27,500,000
    )Maturities and calls of securities held
to maturity
    
    
    
    
    
    
    5,000,000
    
    
    
    33,252Additions to office properties and
Equipment
    
    
    (435,489
    )
    
    
    (1,388,214
    )
    
    
    (3,991,431
    )Acquisition of bank-owned life insurance
    
    
    
    
    
    
    
    
    
    
    (15,000,000
    )Proceeds from disposals of real estate owned
    
    
    1,785,449
    
    
    
    1,418,796
    
    
    
    1,166,703Acquisition of real estate owned
    
    
    
    
    
    
    
    
    
    
    (70,000
    )Investments in nonconsolidated affiliates
    
    
    (131,750
    )
    
    
    
    
    
    
    525,000Net cash from investing activities
    
    
    (70,829,549
    )
    
    
    (76,355,491
    )
    
    
    (112,142,511
    )
  28




---



##### 



2006
    
    
    2005
    
    
    2004Financing Activities:Payments on long-term FHLB advances
    
    
    (100,012,018
    )
    
    
    (27,813
    )
    
    
    (83,389
    )Net increase in short-term FHLB advances
    
    
    60,000,000
    
    
    
    
    
    
    
    15,000,000Proceeds from repurchase agreement
    
    
    50,000,000
    
    
    
    
    
    
    
    Net proceeds from line of credit
    
    
    1,772,871
    
    
    
    
    
    
    
    Repayment of note payable
    
    
    (1,400,780
    )
    
    
    (1,085,470
    )
    
    
    (3,328,900
    )Net change in NOW and passbook savings
    
    
    31,083,809
    
    
    
    (565,469
    )
    
    
    (2,052,829
    )Proceeds from issuance of certificates
of deposit
    
    
    130,717,293
    
    
    
    163,111,432
    
    
    
    107,020,928Payments on maturing certificates of deposit
    
    
    (96,163,379
    )
    
    
    (97,812,199
    )
    
    
    (104,904,312
    )Proceeds from issuance of subordinated
Debentures
    
    
    
    
    
    
    
    
    
    
    10,000,000Net increase (decrease) in advances
from borrowers
    
    
    4,917,117
    
    
    
    808,109
    
    
    
    (5,587,781
    )Payment of cash dividend
    
    
    (2,235,692
    )
    
    
    (2,034,595
    )
    
    
    (1,841,130
    )Purchase of treasury stock
    
    
    (255,742
    )
    
    
    (454,212
    )
    
    
    Proceeds from exercise of stock options
    
    
    144,737
    
    
    
    160,468
    
    
    
    256,793Stock repurchased and retired
    
    
    (141,104
    )
    
    
    (123,024
    )
    
    
    (94,211
    )Net cash from financing activities
    
    
    78,427,112
    
    
    
    61,977,227
    
    
    
    14,385,169Net increase (decrease) in cash
and cash equivalents
    
    
    8,648,193
    
    
    
    (6,379,697
    )
    
    
    (79,281,470
    )Cash and cash equivalents at beginning
of year
    
    
    11,090,076
    
    
    
    17,469,773
    
    
    
    96,751,243Cash and cash equivalents at end of year
    
    $
    19,738,269
    
    
    $
    11,090,076
    
    
    $
    17,469,773Supplemental disclosures of cash flow
information:Cash payments of interest
    
    $
    28,546,235
    
    
    $
    19,766,150
    
    
    $
    16,740,542Cash payments of income taxes
    
    
    2,316,000
    
    
    
    2,069,000
    
    
    
    2,760,000Supplemental schedule of noncash
investing and financing activities:Transfers to real estate owned
    
    $
    1,318,807
    
    
    $
    2,502,472
    
    
    $
    200,000Income tax benefit from exercise of stock options
    
    $
    
    
    
    $
    5,778
    
    
    $
    
  29




---



##### 



NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS
  Principles of Consolidation
   Use of Estimates
 Securities
  30




---



##### 



NOTE 1  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS
   Loans Receivable
  Allowance for Loan Losses
   31




---



##### 



NOTE 1  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS
   Mortgage Banking Activities
     32




---



##### 



NOTE 1  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS
   Office Properties and Equipment
 Bank-Owned Life Insurance
 Income Taxes
 Real Estate Owned
  33




---



##### 



NOTE 1  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS
 Federal Home Loan Bank (FHLB) Stock
 Long-Term Assets
 Statements of Cash Flows
 Stock Compensation
 Comprehensive Income
 Earnings Per Share
  Loss Contingencies
  34




---



##### 



NOTE 1  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS
 Loan Commitments and Related Financial Instruments
 Restrictions on Cash
 Stockholders Equity
 Dividend Restriction
 Fair Value of Financial Instruments
 Operating Segments
 Reclassifications
  35




---



##### 



NOTE 1  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS
 New Accounting Standards
    36




---



##### 



NOTE 2 SECURITIES
  2006Gross
    
    
    Gross
    
    
    EstimatedCarrying
    
    
    Unrecognized
    
    
    Unrecognized
    
    
    FairAmount
    
    
    Gain
    
    
    Loss
    
    
    ValueU.S. government-sponsored enterprise
securities
    
    $
    58,000,000
    
    
    $
    
    
    
    $
    (743,358
    )
    
    $
    57,256,642Due after one year through five years
    
    $
    58,000,000
    
    
    $
    
    
    
    $
    (743,358
    )
    
    $
    57,256,642
 2005Gross
    
    
    Gross
    
    
    EstimatedCarrying
    
    
    Unrecognized
    
    
    Unrecognized
    
    
    FairAmount
    
    
    Gain
    
    
    Loss
    
    
    ValueU.S. government-sponsored enterprise
securities
    
    $
    57,500,000
    
    
    $
    43,750
    
    
    $
    (198,325
    )
    
    $
    57,345,425Due after one year through five years
    
    $
    57,500,000
    
    
    $
    43,750
    
    
    $
    (198,325
    )
    
    $
    57,345,425
    37




---



##### 



NOTE 2 SECURITIES
  2006
    
    Less than 12 Months
    
    
    More than 12 Months
    
    
    TotalGross
    
    
    
    
    
    
    Gross
    
    
    
    
    
    
    GrossFair
    
    
    Unrecognized
    
    
    Fair
    
    
    Unrecognized
    
    
    Fair
    
    
    UnrecognizedDescription of Securities
    
    Value
    
    
    Loss
    
    
    Value
    
    
    Loss
    
    
    Value
    
    
    LossU.S. government-sponsored enterprise
securities
    
    $
    5,398,720
    
    
    $
    (101,280
    )
    
    $
    51,857,922
    
    
    $
    (642,078
    )
    
    $
    57,256,642
    
    
    $
    (743,358
    )
  2005
    
    Less than 12 Months
    
    
    More than 12 Months
    
    
    TotalGross
    
    
    
    
    
    
    Gross
    
    
    
    
    
    
    GrossFair
    
    
    Unrecognized
    
    
    Fair
    
    
    Unrecognized
    
    
    Fair
    
    
    UnrecognizedDescription of Securities
    
    Value
    
    
    Loss
    
    
    Value
    
    
    Loss
    
    
    Value
    
    
    LossU.S. government-sponsored enterprise
securities
    
    $
    34,843,100
    
    
    
    (156,900
    )
    
    $
    17,458,575
    
    
    $
    (41,425
    )
    
    $
    52,301,675
    
    
    $
    (198,325
    )
   38




---



##### 



NOTE 3 MORTGAGE-BACKED SECURITIES
  2006Gross
    
    
    GrossCarrying
    
    
    Unrecognized
    
    
    Unrecognized
    
    
    EstimatedAmount
    
    
    Gain
    
    
    Loss
    
    
    Fair ValueFNMA mortgage-backed securities
    
    $
    27,023,693
    
    
    $
    
    
    
    $
    (1,823,784
    )
    
    
    25,199,909FHLMC mortgage-backed securities
    
    
    554,230
    
    
    
    7,674
    
    
    
    
    
    
    
    561,904$
    27,577,923
    
    
    $
    7,674
    
    
    $
    (1,823,784
    )
    
    $
    25,761,813
 2005Gross
    
    
    GrossCarrying
    
    
    Unrecognized
    
    
    Unrecognized
    
    
    EstimatedAmount
    
    
    Gain
    
    
    Loss
    
    
    Fair ValueFNMA mortgage-backed securities
    
    $
    30,964,609
    
    
    $
    16,375
    
    
    $
    (266,192
    )
    
    $
    30,714,792FHLMC mortgage-backed securities
    
    
    755,424
    
    
    
    17,556
    
    
    
    
    
    
    
    772,980$
    31,720,033
    
    
    $
    33,931
    
    
    $
    (266,192
    )
    
    $
    31,487,772
   39




---



##### 



NOTE 3 MORTGAGE-BACKED SECURITIES
  2006
    
    Less than 12 Months
    
    
    More than 12 Months
    
    
    TotalDescription of
    
    
    
    
    
    Gross
    
    
    
    
    
    
    Gross
    
    
    
    
    
    
    GrossMortgage-backed
    
    Fair
    
    
    Unrecognized
    
    
    Fair
    
    
    Unrecognized
    
    
    Fair
    
    
    UnrecognizedSecurities
    
    Value
    
    
    Loss
    
    
    Value
    
    
    Loss
    
    
    Value
    
    
    LossFNMA mortgage-backed securities
    
    $
    1,985,731
    
    
    
    (84,232
    )
    
    $
    23,214,178
    
    
    $
    (1,739,552
    )
    
    $
    25,199,909
    
    
    $
    (1,823,784
    )
 2005
    
    Less than 12 Months
    
    
    More than 12 Months
    
    
    TotalDescription of
    
    
    
    
    
    Gross
    
    
    
    
    
    
    Gross
    
    
    
    
    
    
    GrossMortgage-backed
    
    Fair
    
    
    Unrecognized
    
    
    Fair
    
    
    Unrecognized
    
    
    Fair
    
    
    UnrecognizedSecurities
    
    Value
    
    
    Loss
    
    
    Value
    
    
    Loss
    
    
    Value
    
    
    LossFNMA mortgage-backed securities
    
    $
    
    
    
    $
    
    
    
    $
    23,234,790
    
    
    $
    (266,192
    )
    
    $
    23,234,790
    
    
    $
    (266,192
    )
   40




---



##### 



NOTE 4 LOANS RECEIVABLE
  2006
    
    
    2005Real estate mortgages:One-to-four family residential
    
    $
    174,574,861
    
    
    $
    148,955,669Home equity line of credit
    
    
    94,449,845
    
    
    
    97,691,917Multi-family residential
    
    
    45,715,780
    
    
    
    33,504,667Commercial
    
    
    170,392,400
    
    
    
    171,331,117Commercial equity line of credit
    
    
    34,063,990
    
    
    
    31,875,316Land
    
    
    77,242,222
    
    
    
    68,164,662Construction  residential
    
    
    84,146,125
    
    
    
    75,459,676Construction  commercial
    
    
    41,712,042
    
    
    
    24,355,272Total real estate mortgages
    
    
    722,297,265
    
    
    
    651,338,296Non real estate loans
    
    
    21,824,041
    
    
    
    17,300,500Total loans receivable
    
    
    744,121,306
    
    
    
    668,638,796Net deferred loan origination fees
    
    
    (3,381,630
    )
    
    
    (3,832,378
    )Allowance for loan losses
    
    
    (4,674,681
    )
    
    
    (4,312,274
    )Loans receivable, net
    
    $
    736,064,995
    
    
    $
    660,494,144
  2006
    
    
    2005
    
    
    2004Beginning balance
    
    $
    4,312,274
    
    
    $
    4,376,704
    
    
    $
    3,882,839Provision for loan losses
    
    
    826,300
    
    
    
    111,000
    
    
    
    597,300Charge-offs
    
    
    (463,893
    )
    
    
    (175,430
    )
    
    
    (132,435
    )Recoveries
    
    
    
    
    
    
    
    
    
    
    29,000Ending balance
    
    $
    4,674,681
    
    
    $
    4,312,274
    
    
    $
    4,376,704
  41




---



##### 



NOTE 4 LOANS RECEIVABLE
  2006
    
    
    2005Loans on non-accrual status:Real estate mortgages:One-to-four family residential
    
    $
    7,586,930
    
    
    $
    7,459,761Commercial
    
    
    2,972,146
    
    
    
    3,518,484Multi-family residential
    
    
    21,300
    
    
    
    21,300Construction and land
    
    
    4,876,009
    
    
    
    750,650Total loans on non-accrual status
    
    
    15,456,385
    
    
    
    11,750,195Loans past due 90 days, still on accrual status:Real estate mortgages:One-to-four family residential
    
    
    
    
    
    
    162,975Construction and land
    
    
    
    
    
    
    445,000Total non-accrual and past due loans
    
    $
    15,456,385
    
    
    $
    12,358,170
    42




---



##### 



NOTE 5 MORTGAGE BANKING ACTIVITIES
  2006
    
    
    2005
    
    
    2004Mortgage loan servicing fees
    
    $
    1,954,692
    
    
    $
    1,872,974
    
    
    $
    1,761,286Amortization and changes in valuation allowance
for mortgage servicing rights
    
    
    (1,359,003
    )
    
    
    (1,641,778
    )
    
    
    (2,388,888
    )Market adjustment for loans held for sale
    
    
    (156,000
    )
    
    
    
    
    
    
    Change in fair value of mortgage banking derivatives
    
    
    (239,000
    )
    
    
    (15,000
    )
    
    
    Gross realized:Gains on sales of loans
    
    
    1,830,073
    
    
    
    2,222,305
    
    
    
    6,930,590Losses on sales of loans
    
    
    (1,196,291
    )
    
    
    (1,127,266
    )
    
    
    (1,670,427
    )$
    834,471
    
    
    $
    1,311,235
    
    
    $
    4,632,561
   2006
    
    
    2005
    
    
    2004Beginning balance
    
    $
    5,001,474
    
    
    $
    5,358,845
    
    
    $
    4,655,182Originated
    
    
    1,164,365
    
    
    
    1,284,407
    
    
    
    3,762,551Amortized
    
    
    (1,359,003
    )
    
    
    (1,641,778
    )
    
    
    (3,058,888
    )Ending balance
    
    $
    4,806,836
    
    
    $
    5,001,474
    
    
    $
    5,358,845Valuation AllowanceBeginning balance
    
    $
    
    
    
    $
    
    
    
    $
    670,000Additions expensed
    
    
    
    
    
    
    
    
    
    
    Reductions credited to expense
    
    
    
    
    
    
    
    
    
    
    (670,000
    )Ending balance
    
    $
    
    
    
    $
    
    
    
    $
    
   43




---



##### 



NOTE 6  OFFICE PROPERTIES AND EQUIPMENT
  2006
    
    
    2005Land and land improvements
    
    $
    1,034,892
    
    
    $
    1,034,892Building and building improvements
    
    
    5,553,076
    
    
    
    5,563,598Leasehold improvements
    
    
    5,943,807
    
    
    
    5,862,620Furniture and equipment
    
    
    12,124,539
    
    
    
    11,758,15924,656,314
    
    
    
    24,219,269Less accumulated depreciation and amortization
    
    
    (12,623,622
    )
    
    
    (10,806,038
    )$
    12,032,692
    
    
    $
    13,413,231
 NOTE 7 DEPOSITS
  2006
    
    
    2005Amount
    
    
    %
    
    
    Amount
    
    
    %12 months or less
    
    $
    441,726,006
    
    
    
    87.6
    %
    
    $
    371,245,515
    
    
    
    79.1
    %13 to 24 months
    
    
    38,845,591
    
    
    
    7.7
    
    
    
    56,248,773
    
    
    
    12.025 to 36 months
    
    
    8,087,568
    
    
    
    1.6
    
    
    
    24,524,716
    
    
    
    5.237 to 48 months
    
    
    15,476,643
    
    
    
    3.1
    
    
    
    17,562,890
    
    
    
    3.7$
    504,135,808
    
    
    
    100.0
    %
    
    $
    469,581,894
    
    
    
    100.0
    %Weighted average rate on certificates of deposit
    
    
    
    
    
    
    4.57
    %
    
    
    
    
    
    
    3.33
    %
    44




---



##### 



NOTE 8  ADVANCES FROM THE FEDERAL HOME LOAN BANK OF CINCINNATI
 Short-Term
Advances
  Long-Term
Advances
 Maturity
    
    Interest rate
    
    
    2006
    
    
    2005February 2006
    
    
    6.05
    %
    
    $
    
    
    
    $
    12,018February 2008
    
    
    5.37
    
    
    
    10,000,000
    
    
    
    10,000,000March 2008
    
    
    5.64
    
    
    
    10,000,000
    
    
    
    10,000,000March 2011
    
    
    3.94
    
    
    
    
    
    
    
    50,000,000May 2011
    
    
    4.16
    
    
    
    
    
    
    
    50,000,000$
    20,000,000
    
    
    $
    120,012,018Weighted average interest rate
    
    
    
    
    
    
    5.51
    %
    
    
    4.29
    %
   45




---



##### 



NOTE 9  SUBORDINATED DEBENTURES, NOTES PAYABLE AND OTHER BORROWINGS
 Line of
Credit
 Subordinated
Debt
  Repurchase
Agreement
  46




---



##### 



NOTE 10  FEDERAL INCOME TAXES
  2006
    
    
    2005
    
    
    2004Amount
    
    
    %
    
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %Computed expected tax
    
    $
    2,413,425
    
    
    
    35.0
    
    
    $
    2,840,290
    
    
    
    35.0
    %
    
    $
    3,616,061
    
    
    
    35.0
    %Increase (decrease) in tax
resulting from:Benefit of graduated rates
    
    
    (68,955
    )
    
    
    (1.0
    )
    
    
    (81,151
    )
    
    
    (1.0
    )
    
    
    (103,316
    )
    
    
    (1.0
    )Affordable housing tax credit
    
    
    (111,645
    )
    
    
    (1.6
    )
    
    
    (111,645
    )
    
    
    (1.4
    )
    
    
    (111,646
    )
    
    
    (1.1
    )Bank-owned life insurance
    
    
    (203,132
    )
    
    
    (2.9
    )
    
    
    (188,498
    )
    
    
    (2.3
    )
    
    
    (63,761
    )
    
    
    (0.6
    )Stock compensation
    
    
    51,757
    
    
    
    0.8
    
    
    
    0
    
    
    
    0.0
    
    
    
    0
    
    
    
    0.0Other, net
    
    
    (28,951
    )
    
    
    (0.5
    )
    
    
    71,996
    
    
    
    0.9
    
    
    
    84,211
    
    
    
    0.8$
    2,052,499
    
    
    
    29.8
    %
    
    $
    2,530,992
    
    
    
    31.2
    %
    
    $
    3,421,549
    
    
    
    33.1
    %
  2006
    
    
    2005Deferred tax assets:Loan loss reserves
    
    $
    1,500,803
    
    
    $
    1,331,863Deferred compensation
    
    
    836,743
    
    
    
    716,310Unrealized gains on loans held for sale
    
    
    
    
    
    
    26,208Mortgage banking reserves
    
    
    139,400
    
    
    
    5,100Other
    
    
    135,847
    
    
    
    61,310Total gross deferred tax assets
    
    
    2,612,793
    
    
    
    2,140,791Deferred tax liabilities:Deferred loan fees, net
    
    
    (337,289
    )
    
    
    (364,432
    )FHLB stock dividend
    
    
    (1,750,269
    )
    
    
    (1,533,145
    )Originated mortgage servicing asset
    
    
    (1,634,324
    )
    
    
    (1,700,501
    )Fixed assets
    
    
    (1,184,677
    )
    
    
    (1,245,855
    )Prepaid franchise tax
    
    
    (163,549
    )
    
    
    (133,400
    )Unrealized losses on loans held for sale
    
    
    (75,971
    )
    
    
    Other
    
    
    (142,608
    )
    
    
    (110,545
    )Total gross deferred tax liabilities
    
    
    (5,288,687
    )
    
    
    (5,087,878
    )Net deferred tax liability
    
    $
    (2,675,894
    )
    
    $
    (2,947,087
    )
   47




---



##### 



NOTE 10  FEDERAL INCOME TAXES
  NOTE 11  LEASES
  Leases With
    
    
    Leases WithUnrelated
    
    
    Related
    
    
    TotalYear ending June 30,
    
    Parties
    
    
    Parties
    
    
    Leases2007
    
    $
    715,464
    
    
    $
    168,145
    
    
    $
    883,6092008
    
    
    695,496
    
    
    
    147,592
    
    
    
    843,0882009
    
    
    621,458
    
    
    
    147,592
    
    
    
    769,0502010
    
    
    500,993
    
    
    
    147,592
    
    
    
    648,5852011
    
    
    206,380
    
    
    
    147,592
    
    
    
    353,972Thereafter
    
    
    202,884
    
    
    
    324,656
    
    
    
    527,540Total minimum lease payments
    
    $
    2,942,675
    
    
    $
    1,083,169
    
    
    $
    4,025,844
   48




---



##### 



NOTE 12  LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES
      2006
    
    2005Commitments to fund variable-rate mortgage loans
    
    $
    48,287,000
    
    
    $
    10,130,000Commitments to fund equity lines of credit
    
    
    92,901,000
    
    
    
    79,452,000Undisbursed portion of loan proceeds
    
    
    66,749,000
    
    
    
    69,715,000
   49




---



##### 



NOTE 12  LOAN COMMITMENTS AND OTHER RELATED ACTIVITIES
  NOTE 13  REGULATORY CAPITAL
      50




---



##### 



NOTE
13  REGULATORY CAPITAL
  Tier-1
    
    
    Tier-1
    
    
    TotalTangible
    
    
    Core
    
    
    Risk-Based
    
    
    Risk-BasedCapital
    
    
    Capital
    
    
    Capital
    
    
    CapitalJune 30, 2006GAAP capital
    
    $
    75,827
    
    
    $
    75,827
    
    
    $
    75,827
    
    
    $
    75,827General loan valuation allowances
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,414Regulatory capital
    
    $
    75,827
    
    
    $
    75,827
    
    
    $
    75,827
    
    
    $
    80,241Total assets
    
    $
    910,776
    
    
    $
    910,776
    
    
    $
    910,776
    
    
    $
    910,776Adjusted total assets
    
    
    910,776
    
    
    
    910,776
    
    
    
    
    
    
    
    Risk-weighted assets
    
    
    
    
    
    
    
    
    
    
    780,203
    
    
    
    780,203Actual capital ratio
    
    
    8.33
    %
    
    
    8.33
    %
    
    
    9.72
    %
    
    
    10.28
    %Regulatory requirement for capital adequacy purposes
    
    
    1.50
    %
    
    
    4.00
    %
    
    
    4.00
    %
    
    
    8.00
    %Regulatory
capital category well-capitalized 
equal to or greater than
    
    
    N/A
    
    
    
    5.00
    %
    
    
    6.00
    %
    
    
    10.00
    %
 Tier-1
    
    
    Tier-1
    
    
    TotalTangible
    
    
    Core
    
    
    Risk-Based
    
    
    Risk-BasedCapital
    
    
    Capital
    
    
    Capital
    
    
    CapitalJune 30, 2005GAAP capital
    
    $
    72,751
    
    
    $
    72,751
    
    
    $
    72,751
    
    
    $
    72,751Nonallowable component
    
    
    (7
    )
    
    
    (7
    )
    
    
    (7
    )
    
    
    (7
    )General loan valuation allowances
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,917Regulatory capital
    
    $
    72,744
    
    
    $
    72,744
    
    
    $
    72,744
    
    
    $
    76,661Total assets
    
    $
    829,818
    
    
    $
    829,818
    
    
    $
    829,818
    
    
    $
    829,818Adjusted total assets
    
    
    829,811
    
    
    
    829,811
    
    
    
    
    
    
    
    Risk-weighted assets
    
    
    
    
    
    
    
    
    
    
    698,777
    
    
    
    698,777Actual capital ratio
    
    
    8.77
    %
    
    
    8.77
    %
    
    
    10.41
    %
    
    
    10.97
    %Regulatory requirement for capital adequacy
purposes
    
    
    1.50
    %
    
    
    4.00
    %
    
    
    4.00
    %
    
    
    8.00
    %Regulatory capital category 
well-capitalized 
equal to or greater than
    
    
    N/A
    
    
    
    5.00
    %
    
    
    6.00
    %
    
    
    10.00
    %
  51




---



##### 



NOTE
14 RELATED PARTY TRANSACTIONS
  Beginning balance
    
    $
    7,018,000New Loans
    
    
    2,500,000Repayments
    
    
    (895,000
    )Ending balance
    
    $
    8,623,000
 NOTE
15 STOCK OPTIONS
     Outstanding
    
    ExercisableWeighted Average
    
    
    
    
    
    WeightedRange of
    
    
    
    
    
    Remaining
    
    
    
    
    
    AverageExercise
    
    
    
    
    
    Contractual
    
    
    
    
    
    ExercisePrice
    
    Number
    
    Life
    
    Number
    
    Price$4.65 - $6.10
    
    
    101,089
    
    
    
    3.38
    
    
    
    101,089
    
    
    $
    5.65$6.72 - $7.77
    
    
    190,531
    
    
    
    3.55
    
    
    
    190,531
    
    
    $
    7.26$8.32 - $13.64
    
    
    266,854
    
    
    
    7.52
    
    
    
    132,709
    
    
    $
    10.65Total
    
    
    558,474
    
    
    
    5.41
    
    
    
    424,329
    
    
    $
    7.94
   52




---



##### 



NOTE
15 STOCK OPTIONS
  2006
    
    
    2005
    
    
    2004Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    AverageExercise
    
    
    
    
    
    
    Exercise
    
    
    
    
    
    
    ExerciseShares
    
    
    Price
    
    
    Shares
    
    
    Price
    
    
    Shares
    
    
    PriceOutstanding beginning of
year
    
    
    470,312
    
    
    $
    8.01
    
    
    
    451,530
    
    
    $
    7.50
    
    
    
    444,579
    
    
    $
    6.83Forfeited
    
    
    (12,250
    )
    
    
    11.10
    
    
    
    (293
    )
    
    
    7.59
    
    
    
    
    
    
    
    Exercised
    
    
    (26,038
    )
    
    
    5.55
    
    
    
    (24,045
    )
    
    
    6.58
    
    
    
    (40,965
    )
    
    
    6.07Granted
    
    
    126,450
    
    
    
    11.16
    
    
    
    43,120
    
    
    
    12.62
    
    
    
    47,916
    
    
    
    12.53Outstanding end of year
    
    
    558,474
    
    
    $
    8.77
    
    
    
    470,312
    
    
    $
    8.01
    
    
    
    451,530
    
    
    $
    7.50Exercisable end of year
    
    
    424,329
    
    
    $
    7.94
    
    
    
    388,446
    
    
    $
    7.41
    
    
    
    352,108
    
    
    $
    7.06
  Accounting for Stock-Based Compensation.
 2005
    
    
    2004Net income as reported
    
    $
    5,584,121
    
    
    $
    6,910,054Stock-based compensation expense
determined under fair value based method
    
    
    147,160
    
    
    
    115,581Income tax effect
    
    
    (8,160
    )
    
    
    (15,446
    )139,000
    
    
    
    100,135Pro forma net income
    
    $
    5,445,121
    
    
    $
    6,809,919Basic earnings per share as reported
    
    $
    0.72
    
    
    $
    0.89Pro forma basic earnings per share
    
    $
    0.70
    
    
    $
    0.88Diluted earnings per share as reported
    
    $
    0.71
    
    
    $
    0.87Pro forma diluted earnings per share
    
    $
    0.69
    
    
    $
    0.86
  53




---



##### 



NOTE
15 STOCK OPTIONS
    2006
    
    2005
    
    2004Risk-free interest rate
    
    
    4.57
    %
    
    
    3.75
    %
    
    
    3.76
    %Dividend yield
    
    
    2.67
    %
    
    
    2.21
    %
    
    
    1.99
    %Expected volatility
    
    
    31.56
    
    
    
    29.29
    
    
    
    29.78Expected life in years
    
    
    9.72
    
    
    
    7.00
    
    
    
    7.00
  2006
    
    2005
    
    2004$3.69
    
    $3.57
    
    $3.35
  54




---



##### 



NOTE
16  EARNINGS PER SHARE
  2006
    
    
    Per-ShareNet Income
    
    
    Shares
    
    
    AmountBasic EPS:Income available to common shareholders
    
    $
    4,843,001
    
    
    
    7,716,770
    
    
    $
    0.63Dilutive effect of assumed exercises of stock options
    
    
    
    
    
    
    129,199
    
    
    
    (0.01
    )Diluted EPS:Income available to common shareholders
    
    $
    4,843,001
    
    
    
    7,845,969
    
    
    $
    0.62
 2005
    
    
    Per-ShareNet Income
    
    
    Shares
    
    
    AmountBasic EPS:Income available to common shareholders
    
    $
    5,584,121
    
    
    
    7,734,136
    
    
    $
    0.72Dilutive effect of assumed exercises of stock options
    
    
    
    
    
    
    172,610
    
    
    
    (0.01
    )Diluted EPS:Income available to common shareholders
    
    $
    5,584,121
    
    
    
    7,906,746
    
    
    $
    0.71
 2004
    
    
    Per-ShareNet Income
    
    
    Shares
    
    
    AmountBasic EPS:Income available to common shareholders
    
    $
    6,910,054
    
    
    
    7,723,543
    
    
    $
    0.89Dilutive effect of assumed exercises of stock options
    
    
    
    
    
    
    187,006
    
    
    
    (0.02
    )Diluted EPS:Income available to common shareholders
    
    $
    6,910,054
    
    
    
    7,910,549
    
    
    $
    0.87
   55




---



##### 



NOTE
17  FAIR VALUE OF FINANCIAL INSTRUMENTS
  June 30, 2006
    
    June 30, 2005Carrying
    
    Estimated
    
    Carrying
    
    EstimatedAmount
    
    Fair Value
    
    Amount
    
    Fair Value(in thousands)Assets:Cash and amounts due from
depository institutions
    
    $
    6,614
    
    
    $
    6,614
    
    
    $
    4,034
    
    
    $
    4,034Interest-bearing deposits
    
    
    1,804
    
    
    
    1,804
    
    
    
    2,181
    
    
    
    2,181Federal funds sold
    
    
    11,320
    
    
    
    11,320
    
    
    
    4,875
    
    
    
    4,875Securities held to maturity
    
    
    58,000
    
    
    
    57,257
    
    
    
    57,500
    
    
    
    57,345Mortgage-backed securities held to
maturity
    
    
    27,578
    
    
    
    25,762
    
    
    
    31,720
    
    
    
    31,488Loans receivable
    
    
    731,997
    
    
    
    725,155
    
    
    
    660,494
    
    
    
    671,554Loans receivable held for sale, net
    
    
    10,698
    
    
    
    10,698
    
    
    
    9,060
    
    
    
    9,165Federal Home Loan Bank stock
    
    
    11,955
    
    
    
    11,955
    
    
    
    11,316
    
    
    
    11,316Accrued interest receivable
    
    
    4,068
    
    
    
    4,068
    
    
    
    3,682
    
    
    
    3,682Mandatory forward sales contracts
    
    
    67
    
    
    
    67
    
    
    
    (34
    )
    
    
    (34
    )Liabilities:Demand deposits and passbook
savings
    
    
    (152,728
    )
    
    
    (152,728
    )
    
    
    (121,644
    )
    
    
    (121,644
    )Time deposits
    
    
    (504,136
    )
    
    
    (500,537
    )
    
    
    (469,582
    )
    
    
    (468,816
    )Line of credit
    
    
    (1,773
    )
    
    
    (1,773
    )
    
    
    
    
    
    
    Advances from the Federal Home
Loan Bank of Cincinnati
    
    
    (95,000
    )
    
    
    (95,021
    )
    
    
    (135,012
    )
    
    
    (137,719
    )Repurchase agreement
    
    
    (50,000
    )
    
    
    (50,000
    )
    
    
    
    
    
    
    Subordinated debentures
    
    
    (10,000
    )
    
    
    (10,000
    )
    
    
    (10,000
    )
    
    
    (10,000
    )Notes payable
    
    
    
    
    
    
    
    
    
    
    (1,401
    )
    
    
    (1,401
    )Accrued interest payable
    
    
    (350
    )
    
    
    (350
    )
    
    
    (489
    )
    
    
    (489
    )Commitments to make loans
Intended to be sold
    
    
    (321
    )
    
    
    (321
    )
    
    
    19
    
    
    
    19
  Cash and amounts due from depository institutions, interest- bearing deposits, and federal funds
sold
  56




---



##### 



NOTE 17 FAIR VALUE OF FINANCIAL INSTRUMENTS
 Securities and mortgage-backed securities
 Loans receivable and loans receivable held for sale
  Federal Home Loan Bank stock.
 Mandatory forward sales contracts.
 Demand deposits and time deposits.
 Line of credit.
 Advances from the Federal Home Loan Bank of Cincinnati
 Notes payable and subordinated debentures
 Accrued interest receivable and accrued interest payable
  57




---



##### 



NOTE 17 FAIR VALUE OF FINANCIAL INSTRUMENTS
 Commitments to make loans intended for sale
 Off-balance-sheet instruments.
  58




---



##### 



NOTE 18
 PARENT COMPANY
  CONDENSED STATEMENTS OF FINANCIAL CONDITION
 2006
    
    
    2005Cash and amounts due from depository institutions
    
    $
    55,404
    
    
    $
    221,263Prepaid expenses and other assets
    
    
    1,823,057
    
    
    
    1,564,558Investment in Bank subsidiary
    
    
    75,827,227
    
    
    
    72,750,959Investment in non-Bank subsidiaries
    
    
    2,887,345
    
    
    
    2,713,536Total assets
    
    $
    80,593,033
    
    
    $
    77,250,316Accrued expenses and other liabilities
    
    $
    1,619,893
    
    
    $
    797,137Subordinated debentures
    
    
    10,000,000
    
    
    
    10,000,000Stockholders equity
    
    
    68,973,140
    
    
    
    66,453,179Total liabilities and stockholders equity
    
    $
    80,593,033
    
    
    $
    77,250,316
 CONDENSED STATEMENTS OF OPERATIONS
 2006
    
    
    2005
    
    
    2004Income:Mortgage banking activities
    
    $
    9,055
    
    
    $
    11,811
    
    
    $
    16,210Dividends from Bank subsidiary
    
    
    2,400,000
    
    
    
    1,000,000
    
    
    
    3,500,000Interest Income
    
    
    
    
    
    
    432
    
    
    
    2,409,055
    
    
    
    1,012,243
    
    
    
    3,516,210Expenses:Interest expense
    
    
    693,292
    
    
    
    503,190
    
    
    
    46,847General and administrative
    
    
    213,035
    
    
    
    195,570
    
    
    
    278,931906,327
    
    
    
    698,760
    
    
    
    325,778Income before federal income taxes and
equity in undistributed net income of subsidiaries
    
    
    1,502,728
    
    
    
    313,483
    
    
    
    3,190,432Federal income tax benefit
    
    
    304,956
    
    
    
    233,018
    
    
    
    105,204Income before equity in undistributed
net income of subsidiaries
    
    
    1,807,684
    
    
    
    546,501
    
    
    
    3,295,636Equity in undistributed net income of subsidiaries
    
    
    3,035,317
    
    
    
    5,037,620
    
    
    
    3,614,418Net income
    
    $
    4,843,001
    
    
    $
    5,584,121
    
    
    $
    6,910,054
  59




---



##### 



NOTE 18  PARENT COMPANY
 CONDENSED STATEMENTS OF CASH FLOWS
 2006
    
    
    2005
    
    
    2004Operating activities:Net income
    
    $
    4,843,001
    
    
    $
    5,584,121
    
    
    $
    6,910,054Equity in undistributed net income of subsidiaries
    
    
    (3,035,317
    )
    
    
    (5,037,620
    )
    
    
    (3,614,418
    )Other, net
    
    
    (285,743
    )
    
    
    (194,216
    )
    
    
    (149,706
    )Net cash from (used in) operating activities
    
    
    1,521,941
    
    
    
    352,3285
    
    
    
    3,145,930Investing activities:Advance to subsidiary
    
    
    800,000
    
    
    
    (805,500
    )
    
    
    1,140,000Investment in subsidiary
    
    
    
    
    
    
    (7,001,000
    )
    
    
    Net decrease in cash from investing activities
    
    
    800,000
    
    
    
    (7,806,500
    )
    
    
    1,140,000Financing activities:Repayment on note payable
    
    
    
    
    
    
    
    
    
    
    (2,500,000
    )Proceeds from subordinated debentures
    
    
    
    
    
    
    
    
    
    
    10,000,000Proceeds from exercise of stock options
    
    
    144,737
    
    
    
    160,468
    
    
    
    256,793Stock purchased and retired
    
    
    (141,104
    )
    
    
    (123,024
    )
    
    
    (94,211
    )Dividends paid
    
    
    (2,235,692
    )
    
    
    (2,034,595
    )
    
    
    (1,841,130
    )Purchase of treasury stock
    
    
    (255,742
    )
    
    
    (454,212
    )
    
    
    Net cash from (used in) financing activities
    
    
    (2,487,800
    )
    
    
    (2,451,363
    )
    
    
    5,821,452Net increase (decrease) in cash and
cash-equivalents
    
    
    (165,859
    )
    
    
    (9,905,578
    )
    
    
    10,107,382Cash and cash equivalents at beginning of year
    
    
    221,263
    
    
    
    10,126,841
    
    
    
    19,459Cash and cash equivalents at end of year
    
    $
    55,404
    
    
    $
    221,263
    
    
    $
    10,126,841Supplemental schedule of non-cash
financing activities:Income tax benefit from exercise of options
    
    $
    
    
    
    $
    5,778
    
    
    $
    
  60




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##### 



NOTE
19 EMPLOYEE BENEFIT PLANS
 401(k)
Savings Plan
  Supplemental
Executive Retirement Plan
  61




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##### 



NOTE
20  SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
 (1)
 Quarters for the year ended June 30, 2006First
    
    
    Second
    
    
    Third
    
    
    FourthInterest income
    
    $
    12,583
    
    
    $
    13,283
    
    
    $
    14,328
    
    
    $
    14,986Interest expense
    
    
    6,048
    
    
    
    6,676
    
    
    
    7,392
    
    
    
    8,292Net interest income
    
    
    6,535
    
    
    
    6,607
    
    
    
    6,936
    
    
    
    6,694Provision for loan losses
    
    
    37
    
    
    
    257
    
    
    
    352
    
    
    
    180Non-interest income
    
    
    779
    
    
    
    561
    
    
    
    535
    
    
    
    625Non-interest expense
    
    
    5,374
    
    
    
    5,443
    
    
    
    5,297
    
    
    
    5,436Income before Federal income taxes
    
    
    1,903
    
    
    
    1,468
    
    
    
    1,822
    
    
    
    1,703Federal income taxes
    
    
    551
    
    
    
    441
    
    
    
    555
    
    
    
    506Net income
    
    $
    1,352
    
    
    $
    1,027
    
    
    $
    1,267
    
    
    $
    1,197Basic earnings per share
    
    $
    0.18
    
    
    $
    0.13
    
    
    $
    0.16
    
    
    $
    0.16Diluted earnings per share
    
    $
    0.17
    
    
    $
    0.13
    
    
    $
    0.16
    
    
    $
    0.16
 Quarters for the year ended June 30, 2005First
    
    
    Second
    
    
    Third
    
    
    FourthInterest income
    
    $
    10,034
    
    
    $
    10,519
    
    
    $
    10,941
    
    
    $
    12,101Interest expense
    
    
    4,424
    
    
    
    4,737
    
    
    
    5,103
    
    
    
    5,537Net interest income
    
    
    5,610
    
    
    
    5,782
    
    
    
    5,838
    
    
    
    6,564Provision for loan losses
    
    
    136
    
    
    
    
    
    
    
    75
    
    
    
    (100
    )Non-interest income
    
    
    685
    
    
    
    859
    
    
    
    939
    
    
    
    891Non-interest expense
    
    
    4,324
    
    
    
    4,577
    
    
    
    4,787
    
    
    
    5,254Income before Federal income taxes
    
    
    1,835
    
    
    
    2,064
    
    
    
    1,915
    
    
    
    2,301Federal income taxes
    
    
    568
    
    
    
    642
    
    
    
    602
    
    
    
    719Net Income
    
    $
    1,267
    
    
    $
    1,422
    
    
    $
    1,313
    
    
    $
    1,582Basic earnings per share
    
    $
    0.16
    
    
    $
    0.18
    
    
    $
    0.17
    
    
    $
    0.20Diluted earnings per share
    
    $
    0.16
    
    
    $
    0.18
    
    
    $
    0.17
    
    
    $
    0.20
 
 (1)
    
    The total of the four quarterly amounts may not equal the full year amount due to
rounding. 62




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##### 



B o a r d    o f    D i r e c t o r s
 John R. Male
 C. Keith Swaney
 Gerald A. Fallon
 Robert K. Healey
 Ronald D. Holman, II
 Stanley T. Jaros
 Raymond J. Negrelli
 Stuart D. Neidus
 E x e c u t i v e    O f f i c e r s
 John R. Male
 C. Keith Swaney
 Jeffrey N. Male
 G e n e r a l    I n f o r m a t i o n
 Independent
Certified Accountants
 General Counsel
 Transfer Agent and Registrar
 Special Counsel
 Stock Listing
 Annual Meeting
 Annual Report on Form 10-K




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