First Place Financial Corp. Reports Quarterly Net Income of $2.9 Million

Highlights

WARREN, Ohio, July 22 /PRNewswire-FirstCall/ -- First Place Financial
Corp. (Nasdaq: FPFC) reported net income of $2.9 million for the quarter ended
June 30, 2008, a decrease of $2.7 million compared with net income of $5.6
million for the quarter ended June 30, 2007. The decrease was primarily due
to an increase of $1.5 million in the provision for loan losses and a $1.4
million charge for impairment of securities. Earnings per share for the
current quarter were $0.18 compared with $0.33 for the same quarter in the
prior year. Return on average equity for the current quarter was 3.75%
compared with 6.84% for the prior year quarter. Return on average tangible
equity for the current quarter was 5.67% compared with 10.15% for the quarter
ended June 30, 2007.
Net income of $2.9 million for the quarter ended June 30, 2008 represented
a decrease of $1.9 million from net income of $4.8 million for the quarter
ended March 31, 2008. The decrease in net income was due to a charge for
impairment of securities, merger expenses and a decrease in mortgage banking
gains. Diluted earnings per share were $0.18 for the current quarter compared
to diluted earnings per share of $0.30 for the preceding quarter ended March
31, 2008. Return on average equity for the current quarter was 3.75% compared
with 6.11% for the preceding quarter ended March 31, 2008.
For the year ended June 30, 2008, First Place Financial Corp. or the
Company reported net income of $10.8 million compared with $25.6 million for
the year ended June 30, 2007, or a decrease of $14.8 million or 57.9%.
Diluted earnings per share were $0.67 for fiscal 2008 compared with $1.49 for
fiscal 2007, or a decline of 55.0%. Return on average assets and return on
average equity for the year ended June 30, 2008 were 0.33% and 3.41%,
respectively, down from 0.83% and 7.92%, respectively, for the year ended June
30, 2007.
Core earnings are a supplementary financial measure computed using methods
other than generally accepted accounting principles (GAAP) that exclude
certain unusual or nonrecurring items of revenue or expense. The $1.2 million
pre-tax charge for merger expenses for the year ended June 30, 2008, and the
$0.7 million pre-tax charge for merger expenses for the year ended June 30,
2007 have been excluded from core earnings. For additional information on
core earnings, see the Explanation of Certain Non-GAAP Measures beginning on
page five of this release and the Reconciliation of GAAP Net Income to Core
Earnings on page nine.
Core earnings for the year ended June 30, 2008 were $11.6 million compared
with $26.1 million for the year ended June 30, 2007, or a decrease of 55.6%.
Core diluted earnings per share were $0.72 for fiscal year 2008 compared with
$1.52 for fiscal year 2007. Core return on average equity for the current
year was 3.66% compared with 8.07% for the prior year. Core return on average
tangible equity for the current year was 5.52% compared with 11.93% for the
prior year.
On June 30, 2008 First Place completed its acquisition of OC Financial,
Inc. (OC Financial). The acquisition adds retail offices in Dublin, Ohio in
the Columbus, Ohio metropolitan area and in Cleveland Heights, Ohio in the
Cleveland metropolitan area. The financial results in this release include
the $68 million of assets acquired but do not include any revenue or expense
of OC Financial.
Commenting on these results, Steven R. Lewis, President and CEO, stated,
"Without the noncash securities impairment and merger charges, our results for
the current quarter were very similar to last quarter's results without the
one-time gain from the adoption of SAB 109. More importantly, we were able to
decrease nonperforming loans and slow the increase in nonperforming assets.
With all of the negative publicity given to asset quality problems in the
Midwest, we are encouraged by this progress. I am particularly pleased with
the performance of our core business units which achieved success in
commercial lending, mortgage banking and core deposit growth. Net interest
margin expansion clearly illustrates that success. As you might expect,
prudent management of capital in these uncertain times is a priority. As a
result, we have reduced our dividend by 50%. And finally, we welcome OC
Financial and its two locations to First Place. We look forward to the growth
opportunities their addition represents."
Revenue
Net interest income for the fourth quarter of fiscal 2008 was $22.9
million, an increase of $1.0 million or 4.6% over the fourth quarter of fiscal
2007. This increase was the result of a 3.2% increase in average earning
assets in the current quarter compared with the same quarter in the prior year
and an increase in the net interest margin of six basis points to 3.13% for
the current quarter from 3.07% for the same quarter in the prior year. Net
interest income also improved compared to the preceding quarter. Net interest
income of $22.9 million and net interest margin of 3.13% for the quarter ended
June 30, 2008 were both increases over net interest income of $21.8 million
and net interest margin of 2.98% for the quarter ended March 31, 2008. A
combination of falling short-term interest rates from September 2007 through
April 2008 and a high concentration of maturing certificates of deposit
enabled First Place to reduce deposit costs more rapidly than asset yields
declined in the current quarter.
Noninterest income for the fourth quarter of fiscal 2008 was $7.5 million,
a decrease of $1.6 million or 17.1% compared with the same quarter in the
prior year. The majority of this decrease was due to a pre-tax charge of $1.4
million for impairment of securities in the current quarter. The increase in
mortgage banking gains of $0.7 million was primarily due to an increase of $22
million in the volume of loans sold to $298 million for the current quarter
compared to $276 million for the same quarter in the prior year and an
increase of 18 basis points in the profit margin on the loans sold. Other
income - non-bank for the current quarter was $1.3 million, a decrease of $0.6
million or 31.3% compared with the same quarter in the prior year. The
decrease in other income - non-bank was primarily due to decreases in
investment and real estate commissions related to the economic slowdown in the
Company's market area.
First Place currently owns $10.5 million of Fannie Mae preferred stock.
The market value of these securities at June 30, 2008 was $9.3 million or $1.2
million less than First Place's book value. At June 30, 2008, management
determined that the impairment in these securities was substantially due to
interest rate changes and was temporary. Since that time, there has been
significant public speculation, both positive and negative, about Fannie Mae's
solvency and the adequacy of their current level of capital. As a result, the
market value for this preferred stock has fluctuated widely. As of the date
of this release, First Place continues to seek additional information about
the financial condition of Fannie Mae as of June 30, 2008. If we determine
that this preferred stock is other than temporarily impaired at June 30, 2008,
we will record up to an additional $1.2 million in other than temporary
impairment write-downs as of June 30, 2008. This could reduce net income for
the quarter and year ended June 30, 2008 by as much as $0.8 million.
Regardless of the outcome of this issue, there would be no change to total
shareholders' equity in the statement of financial condition as these
securities are included in securities available for sale at market value. The
impairment in these securities has already been recorded as an unrealized mark
to market loss included in the accumulated other comprehensive loss category
of shareholders' equity. The Company anticipates finalizing research on this
issue and determining whether additional other than temporary impairment
exists prior to filing our annual report on Form 10-K for the year ended June
30, 2008.
Noninterest Expense
Noninterest expense for the fourth quarter of fiscal year 2008 was $21.2
million, an increase of $1.8 million or 9.1% compared with the same quarter in
the prior year. Salaries and employee benefit costs increased $1.5 million or
17.8% and occupancy and equipment costs increased $0.5 million or 17.5%.
Salaries and employee benefits increased primarily due to a decrease in the
capitalized direct loan costs related to a decrease in the level of commercial
loan originations. Occupancy and equipment costs increased due to an increase
in depreciation related to additions in computer hardware, software and
property and equipment related to the acquisition of Flint, Michigan branches
late in April 2007 and the acquisition of Hicksville Building, Loan and
Savings Bank (HBLS Bank) in October 2007. Real estate owned expense increased
$0.7 million, which was related to an increase in the volume of properties
added to real estate owned in recent months and write-downs taken to reflect
the decline in the value of residential property during the current quarter.
Noninterest expense as a percent of average assets was 2.60% for the quarter
ended June 30, 2008, up from 2.49% for the same quarter in the prior year.
Core noninterest expense excludes merger, integration and restructuring
costs. Core noninterest expense for the quarter ended June 30, 2008 was $20.8
million, an increase of $2.1 million or 11.1% over core noninterest expense of
$18.7 million in the same quarter in the prior year.
Noninterest expense for the fourth quarter of fiscal 2008 of $21.2 million
increased $1.2 million or 6.2% from $20.0 million for the preceding quarter of
fiscal 2008. The increase was primarily due to increases in real estate owned
expense and merger expenses. Noninterest expense as a percent of average
assets increased to 2.60% in the current quarter compared with 2.45% for the
preceding quarter.
Asset Quality
Nonperforming assets, which are comprised of nonperforming loans and real
estate owned, were $74.4 million at June 30, 2008, or 2.22% of total assets,
up $33.7 million from $40.7 million or 1.26% of total assets at June 30, 2007.
Nonperforming loans were $50.7 million at June 30, 2008, or 1.91% of total
loans, up $16.7 million from $34.0 million or 1.35% of total loans at June 30,
2007. Real estate owned was $23.7 million at June 30, 2008, up $17.0 million
from $6.7 million at June 30, 2007. Between March 31, 2008 and June 30, 2008,
nonperforming assets increased $3.7 million due to an increase of $10.5
million in real estate owned, partially offset by a decrease of $6.8 million
in nonperforming loans. First Place works with borrowers to avoid foreclosure
if at all possible. Furthermore, if it becomes inevitable that a borrower
will not be able to retain ownership of their property, First Place often
seeks a deed in lieu of foreclosure in order to gain control of the property
earlier in the recovery process. First Place has been very successful in
obtaining deeds in lieu of foreclosure in the current quarter. As a result,
the balance of real estate owned grew 79.3% during the current quarter while
nonperforming loans have declined 11.8%. Over the long term, this should
result in a significant reduction in the holding period for nonperforming
assets and reduce economic losses. Single family residential properties
represented $15.3 million of the $23.7 million balance of real estate owned at
June 30, 2008.
Net charge-offs were $5.4 million in the current quarter which was an
increase of $4.2 million over net charge-offs of $1.2 million in the prior
year quarter and an increase of $3.2 million from net charge-offs of $2.2
million in the preceding quarter. Each quarter management performs a review
of estimated probable incurred credit losses in the loan portfolio at each
balance sheet date. Based on this analysis, a provision for loan losses of
$4.6 million was recorded for the quarter ended June 30, 2008. That provision
was a $1.4 million increase over the provision of $3.2 million recorded in the
quarter ended June 30, 2007 and a $0.1 million decrease from the provision of
$4.7 million recorded in the preceding quarter. The allowance for loan losses
increased $2.3 million to $28.2 million at June 30, 2008, from $25.9 million
at June 30, 2007. The ratio of the allowance for loan losses to total loans
was 1.07% at June 30, 2008, compared with 1.10% at March 31, 2008 and 1.03% at
June 30, 2007. Another factor considered in determining the level of the
allowance is the type of collateral. Of the total nonperforming loans at June
30, 2008, 98% were secured by real estate. Real estate loans are generally
well secured and if these loans do default, the actual losses are often only a
portion of the total loan amount.
Steven Lewis commented, "We have had great success during the fourth
quarter in obtaining deeds in lieu of foreclosure which will allow us to
preserve our collateral and get it on the market more rapidly. This has
resulted in a high level of charge-offs in the current quarter but will
benefit us in future quarters. Our level of delinquencies and nonperforming
loans continues to remain high as the values of residential real estate have
continued to remain at depressed levels. However, we have experienced a
decrease in delinquent single family loans during the quarter ended June 30,
2008 which is encouraging. On the economic front, we believe that the
announcement of the addition of a third shift at the Lordstown, Ohio General
Motors plant will benefit the economy in the Mahoning Valley. We continue to
recognize the full cost of our current delinquent and nonperforming loans
through our provision for loans losses. This quarter we increased our
allowance for loan losses as a percentage of nonperforming loans to 55.6% up
from 50.0% last quarter, an increase of 11.2%. We remain committed to
reducing nonperforming assets in the coming months."
Balance Sheet Activity
Assets were $3.341 billion at June 30, 2008, compared with $3.226 billion
at June 30, 2007, an increase of $115 million or 3.6%. Virtually all of this
growth was accounted for by two acquisitions, HBLS Bank on October 31, 2007
with $48 million in assets and OC Financial on June 30, 2008 with $68 million
in total assets. Total portfolio loans were $2.649 billion at June 30, 2008,
an increase of $141 million from June 30, 2007. Commercial loans increased
$187 million during fiscal 2008, or 17.9%, to $1.234 billion. Commercial
loans now account for 46.6% of the loan portfolio up from 41.7% at June 30,
2007. Mortgage and construction loans decreased $65 million during the
current fiscal year and consumer loans increased $19 million during the same
period. Loans held for sale declined $24 million to $72 million at June 30,
2008 compared with $96 million at June 30, 2007.
Deposits totaled $2.369 billion at June 30, 2008, an increase of $128
million since June 30, 2007. This increase included $40 million in deposits
acquired as part of HBLS Bank in October 2007 and $43 million in deposits
acquired as part of OC Financial in June 2008. Total borrowings increased $28
million to $621 million at June 30, 2008, compared with June 30, 2007.
Shareholders' equity remains strong; it was $318 million at June 30, 2008,
down $8 million from June 30, 2007. The decline was primarily due to $14
million of purchases of treasury stock during the first six months of fiscal
2008 partially offset by $9 million in treasury stock issued in connection
with the acquisition of OC Financial. During the six months ended December
31, 2007, First Place purchased 880,086 outstanding shares at an average price
of $16.04 per share. There were no treasury stock purchases during the third
and fourth quarters of the fiscal year and the board authorizations to
purchase treasury stock have expired. Shareholders' equity as a percent of
assets was 9.52% at June 30, 2008, down from 9.54% at March 31, 2008 and down
from 10.11% at June 30, 2007. Tangible equity to tangible assets decreased to
6.52% at June 30, 2008 down from 6.53% at March 31, 2008 and down from 6.99%
at June 30, 2007. First Place Bank remains well capitalized under regulatory
capital standards.
Steven Lewis noted, "We continue to grow with high quality commercial
loans bringing greater diversity, higher yields and more business customers
with multiple relationships to the Bank. In the current quarter we were able
to fund this growth with increases in savings accounts at favorable rates
resulting in an increase in our net interest margin. While total assets
increased during the quarter, that increase was supported by common stock
issued as part of the OC Financial acquisition. We are committed to
maintaining our strong capital position in these uncertain financial times."
Pending Acquisition
On May 8, 2008, First Place announced that it had signed a definitive
agreement to acquire Camco Financial Corporation, the holding company for
Advantage Bank headquartered in Cambridge, Ohio. At March 31, 2008, Camco
Financial Corporation had approximately $1.03 billion in assets and currently
operates 23 offices in Ohio, Kentucky and West Virginia. The transaction is
expected to be marginally accretive to regulatory capital and contribute
positively to First Place's earnings per share, excluding one-time merger-
related costs, in its subsequent fiscal year ending June 30, 2009. The
transaction is expected to close during the fourth calendar quarter of 2008
pending regulatory approval, the approvals of First Place and Camco
shareholders, and satisfaction of other customary closing conditions.
Board Actions
At its regular meeting held on July 22, 2008, the Board of Directors
declared a per share cash dividend of $0.085 payable on August 14, 2008, to
shareholders of record as of the close of business on July 31, 2008. This
dividend is a 50% reduction from the dividends of $0.17 declared in recent
quarters. The Board's decision to reduce the quarterly cash dividend will
increase capital available to support future growth or to be retained in First
Place. Steven Lewis commented, "Retaining more capital in the Bank is the
prudent thing to do given the current economic environment. The current
quarter is the third quarter with earnings below historical levels, and this
reduction in the dividend rate will return the dividend payout ratio to the
40-50% range where we have operated historically."
About First Place Financial Corp.
First Place Financial Corp. is a $3.3 billion financial services holding
company based in Warren, Ohio. First Place Financial Corp. operates 45 retail
locations, 2 business financial service centers and 20 loan production offices
through the First Place Bank and the Franklin Bank divisions of First Place
Bank. Additional affiliates of First Place Financial Corp. include First
Place Insurance Agency, Ltd.; Coldwell Banker First Place Real Estate, Ltd.;
TitleWorks Agency, LLC and APB Financial Group, Ltd., an employee benefit
consulting firm and specialist in wealth management services for businesses
and consumers. Information about First Place Financial Corp. may be found on
the Company's web site: www.firstplacebank.com .
Explanation of Certain Non-GAAP Measures
This press release contains certain financial information determined by
methods other than in accordance with Generally Accepted Accounting Principles
(GAAP). Specifically, we have provided financial measures that are based on
core earnings rather than net income. Ratios and other financial measures
with the word "core" in their title were computed using core earnings rather
than net income. Core earnings excludes merger, integration and restructuring
expense; extraordinary income or expense; income or expense from discontinued
operations; and income, expense, gains and losses that are not reflective of
ongoing operations or that we do not expect to reoccur. Similarly, core
noninterest expense or core noninterest income exclude the pretax impact of
those same items that impact noninterest income or noninterest expense. We
believe that this information is useful to both investors and to management
and can aid them in understanding the Company's current performance,
performance trends and financial condition. While core earnings can be useful
in evaluating current performance and projecting current trends into the
future, we do not believe that core earnings are a substitute for GAAP net
income. We encourage investors and others to use core earnings as a
supplemental tool for analysis and not as a substitute for GAAP net income.
Our non-GAAP measures may not be comparable to the non-GAAP measures of other
companies. In addition, future results of operations may include nonrecurring
items that would not be included in core earnings. A reconciliation from GAAP
net income to the non-GAAP measure of core earnings is shown in the
consolidated financial highlights on page nine.
Forward-Looking Statements
When used in this press release, or future press releases or other public
or shareholder communications, in filings by the Company with the Securities
and Exchange Commission or in oral statements made with the approval of an
authorized executive officer, words or phrases such as "will likely result,"
"expect," "will continue," "anticipate," "estimate," "project," "believe,"
"should," "may," "will," "plan," variations of such terms or similar
expressions are intended to identify "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors, which may cause the Company's actual results to be materially
different from those indicated. Such statements are subject to certain risks
and uncertainties including changes in economic conditions in the market areas
the Company conducts business, which could materially impact credit quality
trends, changes in laws, regulations or policies of regulatory agencies,
fluctuations in interest rates, demand for loans in the market areas the
Company conducts business, and competition, that could cause actual results to
differ materially from historical earnings and those presently anticipated or
projected. The Company wishes to caution readers not to place undue reliance
on any such forward-looking statements, which speak only as of the date made.
The Company undertakes no obligation to publicly release the result of any
revisions that may be made to any forward-looking statements to reflect events
or circumstances after the date of such statements or to reflect the
occurrence of anticipated or unanticipated events.

FIRST PLACE FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)

Three months ended Year ended
June 30, Percent June 30, Percent
2008 2007 Change 2008 2007 Change
(Dollars in
thousands, except
share data)
Interest income $44,860 $47,739 (6.0)% $189,672 $186,464 1.7%
Interest expense 21,999 25,885 (15.0) 102,046 99,459 2.6

Net interest
income 22,861 21,854 4.6 87,626 87,005 0.7

Provision for
loan losses 4,631 3,176 45.8 16,467 7,391 122.8
Net interest
income after
provision for
loan losses 18,230 18,678 (2.4) 71,159 79,614 (10.6)

Noninterest income
Service charges
on deposit
accounts 2,140 1,987 7.7 8,346 6,436 29.7
Net gains on
sale of
securities 137 346 (60.4) 874 430 103.3
Impairment of
securities (1,436) - N/M (7,336) - N/M
Mortgage
banking gains 2,398 1,737 38.1 9,257 7,240 27.9
Gain on sale of
loan servicing
rights - 107 N/M 1,961 107 N/M
Loan servicing
income 317 279 13.6 50 1,232 (95.9)
Other income -
bank 1,778 1,686 5.5 6,747 7,066 (4.5)
Insurance
commission
income 900 1,055 (14.7) 3,630 3,633 (0.1)
Other income -
non-bank 1,297 1,888 (31.3) 4,843 6,144 (21.2)
Total
noninterest
income 7,531 9,085 (17.1) 28,372 32,288 (12.1)

Noninterest expense
Salaries and
employee
benefits 10,156 8,625 17.8 40,875 35,951 13.7
Occupancy and
equipment 3,513 2,989 17.5 13,140 11,577 13.5
Professional
fees 627 852 (26.4) 2,781 3,010 (7.6)
Loan expenses 641 489 31.1 2,117 2,121 (0.2)
Marketing 558 786 (29.0) 2,684 2,535 5.9
Merger, integration
& restructuring 451 749 (39.8) 1,241 749 65.7
State and local
taxes 175 451 (61.2) 897 1,239 (27.6)
Amortization of
intangible
assets 1,019 1,118 (8.9) 4,346 4,321 0.6
Real estate
owned expense 894 186 380.6 3,584 726 393.7
Other expense 3,175 3,197 (0.7) 12,400 11,967 3.6
Total
noninterest
expense 21,209 19,442 9.1 84,065 74,196 13.3

Income before
income tax
expense 4,552 8,321 (45.3) 15,466 37,706 (59.0)
Income tax
expense 1,636 2,696 (39.3) 4,674 12,082 (61.3)
Net income $2,916 $5,625 (48.2) $10,792 $ 25,624 (57.9)

SHARE DATA:
Basic earnings
per share $0.18 $0.33 (45.5)% $0.67 $1.51 (55.6)%
Diluted earnings
per share $0.18 $0.33 (45.5) $0.67 $1.49 (55.0)
Cash dividends
per share $0.170 $0.155 9.7 $0.665 $0.605 9.9

Average shares
outstanding -
basic 15,986,481 16,934,216 (5.6) 16,132,198 16,954,804 (4.9)
Average shares
outstanding -
diluted 15,992,275 17,105,823 (6.5) 16,195,704 17,171,684 (5.7)

N/M - Not meaningful

FIRST PLACE FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

June 30, Mar. 31, Dec. 31, Sept. 30, June 30,
2008 2008 2007 2007 2007
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
(Dollars in
thousands)

ASSETS
Cash and due
from banks $59,483 $52,351 $47,268 $54,866 $77,226
Interest-bearing
deposits in
other banks 4,151 5,049 13,583 19,496 9,989
Fed funds sold 5,608 - - - -
Securities
available for
sale 284,559 275,519 267,709 268,610 285,242
Loans held for
sale 72,341 85,372 72,547 60,646 96,163
Loans
Mortgage and
construction 1,015,010 1,018,083 1,081,719 1,095,060 1,079,788
Commercial 1,234,130 1,212,947 1,173,115 1,070,159 1,046,893
Consumer 399,637 384,629 393,383 383,229 381,011
Total
loans 2,648,777 2,615,659 2,648,217 2,548,448 2,507,692
Less allowance
for loan
losses 28,216 28,874 26,360 26,165 25,851
Loans, net 2,620,561 2,586,785 2,621,857 2,522,283 2,481,841
Federal Home
Loan Bank stock 35,761 34,523 34,100 33,209 33,209
Premises and
equipment, net 40,089 50,902 51,568 46,415 45,639
Premises and
equipment held
for sale, net 13,555 - - - -
Goodwill 93,626 91,978 91,835 91,692 91,692
Core deposit and
other
intangibles 13,573 13,998 15,108 15,587 16,678
Other assets 98,176 92,507 88,699 89,791 88,534
Total
assets $3,341,483 $3,288,984 $3,304,274 $3,202,595 $3,226,213

LIABILITIES
Deposits
Noninterest-
bearing
checking $248,851 $227,994 $228,019 $226,710 $242,068
Interest-
bearing
checking 159,874 155,941 157,742 145,925 154,941
Savings 475,835 453,609 432,644 403,630 390,462
Money market 359,801 362,711 391,027 394,748 404,248
Certificates
of deposit 1,124,731 1,128,340 1,090,411 1,060,222 1,048,977
Total
deposits 2,369,092 2,328,595 2,299,843 2,231,235 2,240,696
Short-term
borrowings 195,800 150,214 222,471 224,736 195,249
Long-term debt 425,674 464,371 436,518 384,450 397,914
Other liabilities 32,781 32,106 33,353 39,466 66,167
Total
liabilities 3,023,347 2,975,286 2,992,185 2,879,887 2,900,026

SHAREHOLDERS'
EQUITY 318,136 313,698 312,089 322,708 326,187
Total
liabilities
and shareholders'
equity $3,341,483 $3,288,984 $3,304,274 $3,202,595 $3,226,213

FIRST PLACE FINANCIAL CORP.
CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited) As of or for the three months ended As of or for the
6/30/08 3/31/08 12/31/07 9/30/07 6/30/07 year ended
4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr June 30,
FY 2008 FY 2008 FY 2008 FY 2008 FY 2007 2008 2007
(Dollars in
thousands
except per
share data)

EARNINGS (GAAP)
Tax equivalent
net interest
income $23,241 22,246 21,930 21,746 22,211 89,163 88,451
Net interest
income $22,861 21,835 21,558 21,372 21,854 87,626 87,005
Provision for
loan losses $4,631 4,680 5,195 1,961 3,176 16,467 7,391
Noninterest
income $7,531 9,936 714 10,191 9,085 28,372 32,288
Noninterest
expense $21,209 19,972 22,455 20,429 19,442 84,065 74,196
Net income
(loss) $2,916 4,769 (3,147) 6,254 5,625 10,792 25,624
Basic
earnings
(loss) per
share $0.18 0.30 (0.20) 0.38 0.33 0.67 1.51
Diluted
earnings
(loss) per
share $0.18 0.30 (0.20) 0.38 0.33 0.67 1.49

PERFORMANCE RATIOS
(annualized) (GAAP)
Return on
average
assets 0.36% 0.59% (0.39)% 0.78% 0.72% 0.33% 0.83%
Return on
average equity 3.75% 6.11% (3.93)% 7.72% 6.84% 3.41% 7.92%
Return on
average
tangible
assets 0.37% 0.61% (0.40)% 0.81% 0.75% 0.34% 0.86%
Return on
average
tangible
equity 5.67% 9.25% (5.91)% 11.60% 10.15% 5.13% 11.71%
Net interest
margin, fully
tax equivalent 3.13% 2.98% 2.92% 2.94% 3.07% 2.96% 3.11%
Efficiency
ratio 68.93% 62.06% 99.17% 63.97% 62.12% 71.52% 61.45%
Noninterest
expense as a
percent of
average
assets 2.60% 2.45% 2.76% 2.55% 2.49% 2.59% 2.41%

RECONCILIATION
OF NET INCOME
TO CORE EARNINGS
GAAP net income
(loss) $2,916 4,769 (3,147) 6,254 5,625 10,792 25,624
Merger,
integration
and
restructuring,
net of tax $293 - 514 - 487 807 487
Core earnings
(loss) $3,209 4,769 (2,633) 6,254 6,112 11,599 26,111

CORE EARNINGS
Core earnings $3,209 4,769 (2,633) 6,254 6,112 11,599 26,111
Basic core
earnings
(loss) per
share $0.20 0.30 (0.16) 0.38 0.36 0.72 1.54
Core diluted
earnings
(loss) per
share $0.20 0.30 (0.16) 0.38 0.36 0.72 1.52

CORE PERFORMANCE
RATIOS (annualized)
Core return on
average assets 0.39% 0.59% (0.32)% 0.78% 0.78% 0.36% 0.85%
Core return on
average equity 4.13% 6.11% (3.28)% 7.72% 7.44% 3.66% 8.07%
Core return on
average tangible
assets 0.41% 0.61% (0.33)% 0.81% 0.81% 0.37% 0.88%
Core return on
average tangible
equity 6.23% 9.25% (4.94)% 11.60% 11.03% 5.52% 11.93%
Core net interest
margin, fully
tax equivalent 3.13% 2.98% 2.92% 2.94% 3.07% 2.96% 3.11%
Core efficiency
ratio 67.46% 62.06% 95.68% 63.97% 59.73% 70.47% 60.83%
Core noninterest
expense as a
percent of
average assets 2.55% 2.45% 2.66% 2.55% 2.39% 2.55% 2.38%

FIRST PLACE FINANCIAL CORP.
CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited) As of or for the three months ended
6/30/08 3/31/08 12/31/07 9/30/07 6/30/07
4th Qtr 3rd Qtr 2nd Qtr 1st Qtr 4th Qtr
FY 2008 FY 2008 FY 2008 FY 2008 FY 2007
(Dollars in
thousands except
per share data)

CAPITAL
Equity to total
assets at end of
period 9.52% 9.54% 9.45% 10.08% 10.11%
Tangible equity to
tangible assets 6.52% 6.53% 6.42% 6.96% 6.99%
Book value per
share $18.74 19.11 19.01 19.24 18.92
Tangible book value
per share $12.43 12.65 12.50 12.85 12.64
Period-end market
value per share $9.40 13.00 13.99 17.70 21.12
Dividends declared
per common share $0.170 0.170 0.170 0.155 0.155
Common stock
dividend payout
ratio 94.44% 56.67% N/M 40.79% 46.97%
Period-end common
shares outstanding
(000) 16,973 16,418 16,416 16,770 17,236
Average basic shares
outstanding (000) 15,986 15,969 16,096 16,475 16,934
Average diluted
shares outstanding
(000) 15,992 15,999 16,096 16,590 17,106

ASSET QUALITY
Net charge-offs $5,434 2,165 5,254 1,647 1,169
Annualized net
charge-offs to
average loans 0.84% 0.33% 0.80% 0.26% 0.19%
Nonperforming loans
(NPLs) $50,722 57,480 46,322 36,832 33,962
NPLs as a percent
of total loans 1.91% 2.20% 1.75% 1.45% 1.35%
Nonperforming assets
(NPAs) $74,417 70,692 55,914 46,848 40,678
NPAs as a percent
of total assets 2.22% 2.15% 1.69% 1.46% 1.26%
Allowance for loan
losses $28,216 28,874 26,360 26,165 25,851
Allowance for loan
losses as a percent
of loans 1.07% 1.10% 1.00% 1.03% 1.03%
Allowance for loan
losses as a percent
of NPLs 55.63% 50.23% 56.91% 71.04% 76.12%

MORTGAGE BANKING
Mortgage
originations $333,000 335,700 282,400 330,700 356,300
Net gains on sale
of loans $2,398 3,938 1,065 1,856 1,737
Mortgage servicing
portfolio $1,425,915 1,357,944 1,228,283 1,062,742 2,095,607
Mortgage servicing
rights $14,272 13,402 11,721 10,876 20,785
Mortgage servicing
rights valuation
(loss) recovery $(100) (145) (305) - 70
Mortgage servicing
rights / Mortgage
servicing portfolio 1.00% 0.99% 0.95% 1.02% 0.99%

END OF PERIOD
BALANCES
Assets $3,341,483 3,288,984 3,304,274 3,202,595 3,226,213
Deposits $2,369,092 2,328,595 2,299,843 2,231,235 2,240,696
Shareholders'
equity $318,136 313,698 312,089 322,708 326,187
Tangible
shareholders'
equity $210,937 207,722 205,146 215,429 217,817

AVERAGE BALANCES
Loans $2,584,075 2,625,799 2,613,435 2,551,278 2,503,590
Loans held for
sale $84,488 74,675 60,112 82,538 93,719
Earning assets $2,990,218 3,007,062 2,989,442 2,939,959 2,898,204
Assets $3,277,767 3,276,830 3,236,941 3,185,983 3,134,562
Deposits $2,330,860 2,323,244 2,279,620 2,225,830 2,193,083
Shareholders'
equity $312,467 313,888 318,909 322,372 329,652
Tangible
shareholders'
equity $207,009 207,400 211,933 214,555 220,330

As of or for the
year ended
June 30,
(Dollars in thousands except per share data) 2008 2007

CAPITAL
Equity to total assets at end of period 9.52% 10.11%
Tangible equity to tangible assets 6.52% 6.99%
Book value per share $18.74 18.92
Tangible book value per share $12.43 12.64
Period-end market value per share $9.40 21.12
Dividends declared per common share $0.665 0.605
Common stock dividend payout ratio 99.25% 40.60%
Period-end common shares outstanding (000) 16,973 17,236
Average basic shares outstanding (000) 16,132 16,955
Average diluted shares outstanding (000) 16,196 17,172

ASSET QUALITY
Net charge-offs $14,500 3,859
Annualized net charge-offs to average loans 0.56% 0.16%
Nonperforming loans (NPLs) $50,722 33,962
NPLs as a percent of total loans 1.91% 1.35%
Nonperforming assets (NPAs) $74,417 40,678
NPAs as a percent of total assets 2.22% 1.26%
Allowance for loan losses $28,216 25,851
Allowance for loan losses as a percent of
loans 1.07% 1.03%
Allowance for loan losses as a percent of NPLs 55.63% 76.12%

MORTGAGE BANKING
Mortgage originations $1,281,800 1,120,200
Net gains on sale of loans $9,257 7,240
Mortgage servicing portfolio $1,425,915 2,095,607
Mortgage servicing rights $14,272 20,785
Mortgage servicing rights valuation (loss)
recovery $(550) 111
Mortgage servicing rights / Mortgage
servicing portfolio 1.00% 0.99%

END OF PERIOD BALANCES
Assets $3,341,483 3,226,213
Deposits $2,369,092 2,240,696
Shareholders' equity $318,136 326,187
Tangible shareholders' equity $210,937 217,817

AVERAGE BALANCES
Loans $2,593,585 2,435,203
Loans held for sale $75,431 103,731
Earning assets $2,983,420 2,844,184
Assets $3,244,183 3,080,945
Deposits $2,289,632 2,117,703
Shareholders' equity $316,932 323,575
Tangible shareholders' equity $210,243 218,826

For Further Information:
Steven R. Lewis, President & CEO
David W. Gifford, CFO
(330) 373-1221

SOURCE First Place Financial Corp.

Steven R. Lewis, President & CEO, or David W. Gifford, CFO, of First Place
Financial Corp., +1-330-373-1221