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Section 1: 8-K (FORM 8-K)

Form 8-K





Washington, D.C. 20549







Pursuant to Section 13 OR 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 23, 2018




(Exact name of registrant as specified in its charter)




Ohio   0-16540   34-1405357

(State or other jurisdiction

of incorporation)



File Number)


(IRS Employer

Identification No.)


201 South 4th Street, Martins Ferry, Ohio   43935-0010
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code: (740) 633-0445


(Former name or former address, if changed since last report.)



Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:


Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)


Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)


Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))


Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐




Item 2.02. Results of Operations and Financial Condition.

On July 23, 2018, United Bancorp, Inc. issued a press release announcing its results of operations and financial condition for and as of the three and six month periods ended June 30, 2018, unaudited. The press release is furnished as Exhibit No. 99 hereto.


Item 9.01. Financial Statements and Exhibits.


(d) Exhibits

The following exhibits are furnished herewith:




Exhibit Description

99    Press release, dated July 23, 2018, announcing Registrant’s unaudited results of operations and financial condition for and as of the three and six month periods ended June 30, 2018.


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


Dated: July 23, 2018     UNITED BANCORP, INC.
      /s/ Randall M. Greenwood
      Randall M. Greenwood

Senior Vice President and

Chief Financial Officer

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Section 2: EX-99 (EXHIBIT 99)

Exhibit 99

Exhibit 99










United Bancorp, Inc. 201 South 4th at Hickory Street, Martins Ferry, OH 43935


Contacts:    Scott A. Everson    Randall M. Greenwood
   President and CEO    Senior Vice President, CFO and Treasurer
   (740) 633-0445, ext. 6154    (740) 633-0445, ext. 6181

FOR IMMEDIATE RELEASE: 11:00 a.m. July 23, 2018

United Bancorp, Inc. Reports an Increase in Net Income of 34% for the Six Months Ended June 30, 2018; Diluted Earnings per Share of $0.44 versus $0.35 Reported in 2017, and a Forward Dividend Yield of 3.85%

MARTINS FERRY, OHIO ◆◆◆ United Bancorp, Inc. (NASDAQ: UBCP), headquartered in Martins Ferry, Ohio, reported diluted earnings per share of $0.44 and net income of $2,360,000 for the six months ended June 30, 2018, as compared to $0.35 and $1,766,000, respectively, for 2017. The Company’s diluted earnings per share for the three months ended June 30, 2018 was $0.22 as compared to $0.18 to the same period in 2017. These year-over-year improvements in UBCP’s earnings are directly related to the lower base corporate tax rate resulting from the passage of the Tax Cuts and Jobs Act (“tax act”) in the fourth quarter of 2017 and the benefit of operational improvements on which the company is starting to see a positive return. Each of these realities should significantly benefit the company in future periods.

Randall M. Greenwood, Senior Vice President, CFO and Treasurer remarked, “We are excited to report on the solid performance that our Company had for the six-month period ended June 30, 2018. Although the tax act has had a positive impact on our net income, this release will mainly focus on the strong growth of net income before taxes from operations. Overall, operational enhancements led to forty-four percent (44%) of the improvement in net income for the six months ended June 30, 2018. Our Company had a solid increase in net income before taxes of $259,000, or 10.2%, for the six months ended June 30, 2018, over the six months ended June 30, 2017. The primary drivers of this year-over-year increase in net income before taxes were the increases in interest income and fees on loans, which were up by $782,000, or 9.6%, and interest income on securities, which was up by $477,000, or 131.6%. Relating to loan growth, our Company had an increase in its gross loans of $21.9 million, or 6.1%, from June 30, 2017 to June 30, 2018. While growing the loan portfolio, our Company was able to maintain its overall stability in credit quality. Year-over-year, we continued to have very solid credit quality-related metrics supported by nonaccrual loans decreasing from a level of $1.6 million to $1.2 million, a decline of $400,000 or 24.9%. Further—net loans charged off, excluding overdrafts, was $121,000 for the six months ended June 30, 2018, which is a relatively modest increase of $67,000 from the six months ended June 30, 2017. Annualized net charge offs to average loans was 0.09% for the six months ended June 30, 2018, as compared to 0.06% for the six months ended June 30, 2017.” Greenwood continued, “Due to the rising rate environment in which we are currently operating, we are seeing opportunities in the area of securities investments; whereby, we are finally seeing yields that are at acceptable levels, which is encouraging us to leverage-up to some degree. Since June 30, 2017, our Company saw an increase in securities and other restricted stock of $47.3 million, or 109.9%, from the prior year. With our quarter-ending securities and other restricted stock position of $90.4 million being above the quarterly average of $67.2 million, we strongly anticipate more contribution to interest income from this area in future periods. With the enhanced level of total interest income that we realized in the first six months of 2018, net

interest income for the six months ended June 30, 2018 for our Company increased by $904,000, or 11.9%, even as we focused on growing retail core deposits to fund our growth. Total deposits increased by $41.7 million, or 11.2%, to a level of $415.6 million as of June 30, 2018. Even with this significant increase in total deposits, we were able to control our overall interest expense levels by attracting lower-cost retail funding to replace higher-cost wholesale funding advances that matured over the past 12 months. Overall, our Company saw low-cost retail funding (consisting of non-interest and interest bearing demand and savings deposits) comprise $37.4 million of its growth in retail deposits year-over-year. In addition, time deposits, which consist of certificate of deposit or term funding, increased by $4.3 million, or 6.7%, for the same period. This growth in retail core deposit funding (along with increased levels of wholesale borrowing) and the increasing interest rate environment in which we are currently operating led to a slight elevation in our interest expense levels and our interest expense to average assets, which increased from 0.40% for the six months ended June 30, 2017 to 0.51% for the six months ended June 30, 2018. Overall, with the growth in our interest income outpacing the increases that we experienced in our interest expense, we had an increase in our net interest margin, which went from 3.83% in 2017 to 3.90% as of the end of this most recent quarter.”

Relating to our Company’s net noninterest margin, Greenwood stated, “Our total noninterest income increased $67,000, or 4.0%, year over year. A majority of this increase was realized in the area of service charges on deposit accounts, which is the area in which our Company performs at a high level relative to peer. On the noninterest expense-side of the net noninterest margin (and, as budgeted), we experienced an increase in our noninterest expense of $634,000 or 9.5%. Most of the increase in noninterest expense continues to be related to infrastructure enhancement and personnel-related expenses as we prepare for the future growth that we envision.” Greenwood concluded, “Considering that most of the aforementioned expenses are “fixed,” we firmly believe that we have positive operating leverage, which should allow us to drive higher levels of revenue without significantly adding to our overall noninterest expense levels in the short-term; therefore, enhancing our Company’s earnings and returns. Of material note in the most recent quarter, our Company incurred approximately $123,000 in merger related and other one time expenses with a majority of these expenses relating to the June 14, 2018 announcement of a Definitive Agreement to acquire Powhatan Point Community Bancshares, Inc. These one time expenses decreased the diluted earnings per share for the Company by $0.02 in the most recent quarter. It is anticipated that during the third and fourth quarters of 2018, our Company will incur additional merger-related expenses in connection with this transaction.”

Scott A. Everson, President and CEO stated, “We are extremely pleased to see the strong growth in our earnings for the six months ended June 30, 2018. Our Company continues to benefit from the enactment of the tax act, which has reduced the overall tax rate for companies, such as ours, from 35% to 21%. Overall, the tax act contributed fifty-six percent (56%) of our increase in net income for the six months ended June 30, 2018. We are also gratified to see that our investment in both the infrastructure and personnel of our Company is producing a positive return for us. On an operating basis, we saw an improvement in our earnings before income taxes, which contributed forty-four percent (44%) of the increase that we had in our bottom line earnings! With our focus on continuing to enhance our lending platforms, we anticipate seeing stronger loan growth in the coming year. In addition, with the implementation of an investment strategy during the course of the first quarter of this year, we anticipate having more investment securities-based leverage on our balance sheet in the coming quarters. Each of these aforementioned items have led to year-over-year growth in earning assets (consisting of both loans and investment securities) of $69.3 million or 17.3%. This realized growth in earning assets during the first half of this year, and the anticipation of additional growth in this area in the second half of 2018, should lead to the continuation of our Company growing its level of earning assets and generating higher levels of interest income. Increasing leverage at an acceptable spread should allow our Company to pay slightly higher rates to attract retail-based core funding to fund our growth, while maintaining our net interest margin and improving our overall level of net interest income. Year-over-year, we saw the net interest margin of our Company improve by seven (7) basis points to a level of 3.90% as of June 30, 2018. Our enhanced net interest margin led to our net interest income improving on a year-over-year basis by $904,000 or 11.9%.”

Everson continued, “We have stated for many quarters that our goal is to grow our Company if we can do it in a profitable fashion. We are glad that we are in a position, at present, to accomplish this. At this most recent quarter end, our Company had total assets of $514.8 million, which is an increase of $66.1 million, or 14.7%, over the previous year. This is the highest level of total assets in our Company’s history and, for the first time,

we surpassed the $500.0 million total asset threshold during the second quarter. Our viewpoint is that profitable growth will lead to positive opportunities to further grow our Company! In this area, we have very high expectations for our Company over the course of the next three years. Our ultimate goal is to become a “hybrid or omnichannel” bank; whereby, we can serve our present and future customers on “their” terms. By having both exceptional “in-branch” and “virtual” service options for our customers, we believe that our Company will have relevance within our industry for many years to come. In addition, we will be able to deliver on our current vision for growth, which is to have total assets greater than $1.0 billion. As previously announced our Company and Powhatan Point Community Bancshares, Inc. (“Powhatan”), the holding company for First National Bank of Powhatan Point (“First National”), announced on June 14, 2018 that we have signed a definitive merger agreement; whereby, we will acquire Powhatan in a stock and cash transaction. Upon completion, First National will be merged into our subsidiary bank, Unified Bank. At that time, the main office of First National will become a full-service branch of Unified Bank. Powhatan operates one full-service office in Belmont County, Ohio and has approximately $62.8 million in assets, $6.7 million in loans, $57.6 million of deposits and $5.1 million in consolidated equity as of June 30, 2018. This transaction will develop a presence for our Company in Southern Belmont County, which has seen nice growth in recent years relating to the oil and gas development in this area. In addition, this area has the potential for much more growth in the near to intermediate term with the expected announcement of the building of a much anticipated ethane cracker plant. This acquisition is expected to close in the fourth quarter of 2018 and is subject to Powhatan shareholder approval, regulatory approval, and other conditions set forth in the merger agreement.”

Everson concluded, “As always, one of our primary focuses is to reward our valued shareholders by paying a solid cash dividend. With our improving earnings in 2018, we increased our cash dividend payout during the first quarter of this year. On a year-over-year basis as of June 30, 2018, our Company paid cash dividends of $0.26, versus $0.22 in 2017, an increase of 18.2%. At our present cash dividend payout level of $0.13, our Company’s stock has a forward dividend yield of 3.85%, which is significantly higher than the average cash dividend yield seen within our industry. Our other primary focus continues to be growing our shareholders’ investment in our Company through profitable operations and strategic growth. As of the most recent quarter end, our market value was $13.50, which is up from the same period in the previous year by $1.30 or 10.7%. We will continue to keenly focus on these two key areas to provide value for our loyal shareholders. Overall, we are pleased with the improving performance of our Company during the first six months of 2018 and the direction that we are going. With the positive growth that we have experienced so far in 2018, and with the anticipated growth that will occur during the remainder of the current year, we are extremely optimistic about our future potential and look forward to realizing this upside potential in future periods!”

United Bancorp, Inc. is headquartered in Martins Ferry, Ohio and has total assets of $514.8 million and total shareholder’s equity of $45.0 million as of June 30, 2018. Through its single bank charter, Unified Bank, the Company has eighteen banking offices that serve the Ohio Counties of Athens, Belmont, Carroll, Fairfield, Harrison, Jefferson and Tuscarawas. The Company also operates a Loan Production Office in Wheeling, WV. United Bancorp, Inc. is a part of the Russell Microcap Index and trades on the NASDAQ Capital Market tier of the NASDAQ Stock Market under the symbol UBCP, Cusip #909911109.

Certain statements contained herein are not based on historical facts and are “forward-looking statements” within the meaning of Section 21A of the Securities Exchange Act of 1934. Forward-looking statements, which are based on various assumptions (some of which are beyond the Company’s control), may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as “may,” “will,” “believe,” “expect,” “estimate,” “anticipate,” “continue,” or similar terms or variations on those terms, or the negative of these terms. Actual results could differ materially from those set forth in forward-looking statements, due to a variety of factors, including, but not limited to, those related to the economic environment, particularly in the market areas in which the company operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, acquisitions and the integration of acquired businesses, credit risk management, asset/liability management, changes in the financial and securities markets, including changes with respect to the market value of our financial assets, and the availability of and costs associated with sources of liquidity. The Company undertakes no obligation to update or carry forward-looking statements, whether as a result of new information, future events or otherwise.

     United Bancorp, Inc. "UBCP"  
     For the Three Months Ended June 30,     %     $  
     2018     2017     Change     Change  



Interest income on loans

   $ 4,341,084     $ 3,842,737       12.97   $ 498,347  

Loan fees

     221,120       252,077       -12.28   $ (30,957

Interest income on securities

     545,138       194,881       179.73   $ 350,257  







Total interest income

     5,107,342       4,289,695       19.06   $ 817,647  

Total interest expense

     706,062       437,412       61.42   $ 268,650  







Net interest income

     4,401,280       3,852,283       14.25   $ 548,997  

Provision for loan losses

     72,000       24,999       188.01   $ 47,001  

Net interest income after provision for loan losses

     4,329,280       3,827,284       13.12   $ 501,996  

Service charges on deposit accounts

     650,577       631,892       2.96   $ 18,685  

Net realized gains on sale of loans

     22,546       29,595       -23.82   $ (7,049

Other noninterest income

     214,854       207,194       3.70   $ 7,660  

Total noninterest income

     887,977       868,681       2.22   $ 19,296  

Total noninterest expense

     3,754,331       3,364,485       11.59   $ 389,846  







Earnings before income taxes

     1,462,926       1,331,480       9.87   $ 131,446  







Income tax expense

     250,051       415,217       -39.78   $ (165,166







Net income

   $ 1,212,875     $ 916,263       32.37   $ 296,612  

Per share


Earnings per common share—Basic

   $ 0.24     $ 0.18       33.33  

Earnings per common share—Diluted

     0.22       0.18       22.22  

Cash dividends paid

     0.13       0.11       18.18  

Annualized yield based on quarter end close

     3.85     3.60     0.25  

Shares Outstanding



     4,990,904       4,847,884       —      


     5,216,934       4,966,986       —      
     For the Six Months Ended June 30,     %        
     2018     2017     Change        



Interest income on loans

   $ 8,456,924     $ 7,769,572       8.85   $ 687,352  

Loan fees

     436,357       341,912       27.62   $ 94,445  

Interest income on securities

     838,924       362,179       131.63   $ 476,745  

Total interest income

     9,732,205       8,473,663       14.85   $ 1,258,542  

Total interest expense

     1,229,667       875,573       40.44   $ 354,094  

Net interest income

     8,502,538       7,598,090       11.90   $ 904,448  

Provision for loan losses

     129,000       49,998       158.01   $ 79,002  

Net interest income after provision for loan losses

     8,373,538       7,548,092       10.94   $ 825,446  

Service charges on deposit accounts

     1,281,166       1,229,021       4.24   $ 52,145  

Net realized gains on sale of loans

     36,766       44,287       -16.98   $ (7,521

Other noninterest income

     450,200       427,667       5.27   $ 22,533  

Total noninterest income

     1,768,132       1,700,975       3.95   $ 67,157  

Total noninterest expense

     7,332,893       6,699,035       9.46   $ 633,858  

Earnings before income taxes

     2,808,777       2,550,032       10.15   $ 258,745  

Income tax expense

     448,350       783,982       -42.81   $ (335,632

Net income

   $ 2,360,427     $ 1,766,050       33.66   $ 594,377  

Per share


Earnings per common share—Basic

   $ 0.46     $ 0.35       31.43  

Earnings per common share—Diluted

     0.44       0.35       25.71  

Cash dividends paid

     0.26       0.22       18.18  

Shares Outstanding



     4,986,290       4,839,725       —      


     5,211,288       4,985,827       —      

Common stock, shares issued

     5,360,304       5,430,304       —      

Shares held as Treasury

     5,744       5,744       —      

At quarter end


Total assets

   $ 514,801,418     $ 448,672,091       14.74   $ 66,129,327  

Total assets (average)

     478,263,000       442,017,000       8.20   $ 36,246,000  

Other real estate and repossessions ("OREO")

     615,000       293,430       109.59   $ 321,570  

Gross loans

     379,512,976       357,569,542       6.14   $ 21,943,434  

Allowance for loan losses

     2,080,145       2,292,265       -9.25   $ (212,120

Net loans

     377,432,831       355,277,277       6.24   $ 22,155,554  

Non-accrual loans

     1,204,256       1,603,814       -24.91   $ (399,558

Loans past due 30+ days (excludes non accrual loans)

     1,730,632       985,950       75.53   $ 744,682  

Net loans charged-off

     120,839       53,674       125.14   $ 67,165  

Net overdrafts charged-off

     50,254       45,397       10.70   $ 4,857  

Net charge-offs

     171,093       99,071       72.70   $ 72,022  

Average loans

     370,341,000       354,624,000       4.43   $ 15,717,000  

Cash and due from Federal Reserve Bank

     16,308,016       20,784,147       -21.54   $ (4,476,131

Average cash and due from Federal Reserve Bank

     13,402,000       16,948,000       -20.92   $ (3,546,000

Securities and other restricted stock

     90,376,328       43,056,776       109.90   $ 47,319,552  

Average securities and other restricted stock

     67,222,000       43,165,000       55.73   $ 24,057,000  

Total deposits

     415,634,366       373,915,205       11.16   $ 41,719,161  

Non interest bearing demand

     68,903,739       71,078,504       -3.06   $ (2,174,765

Interest bearing demand

     194,049,223       156,893,040       23.68   $ 37,156,183  


     83,838,243       81,421,172       2.97   $ 2,417,071  

Time < $100,000

     63,035,793       59,677,638       5.63   $ 3,358,155  

Time > $100,000

     5,807,368       4,844,851       19.87   $ 962,517  

Average total deposits

     402,436,000       356,961,000       12.74   $ 45,475,000  

Advances from the Federal Home Loan Bank

     33,768,093       10,287,302       228.25   $ 23,480,791  

Overnight advances

     33,600,000       —         N/A     $ 33,600,000  

Term advances

     168,093       10,287,302       -98.37   $ (10,119,209

Securities sold under agreements to repurchase

     12,345,503       10,287,302       20.01   $ 2,058,201  

Stockholders' equity

     44,985,506       43,653,232       3.05   $ 1,332,274  

Stockholders' equity (average)

     44,986,000       43,632,000       3.10   $ 1,354,000  

Stock data


Market value—last close (end of period)

   $ 13.50     $ 12.20       10.66  

Dividend payout ratio

     56.52     62.86     -6.33  

Price earnings ratio

     16.88     17.43     3.47  

Book value (end of period)

     9.04       8.81       2.61  

Market price to book value

     149.34     138.48     7.84  

Key performance ratios


Return on average assets (ROA)

     0.99     0.80     0.19  

Return on average equity (ROE)

     10.49     8.10     2.39  

Net interest margin (federal tax equivalent))

     3.90     3.83     0.07  

Interest expense to average assets

     0.51     0.40     0.11  

Total allowance for loan losses


to nonaccrual loans

     172.73     142.93     29.80  

Total allowance for loan losses


to total loans

     0.55     0.64     -0.09  

Nonaccrual loans to total loans

     0.32     0.45     -0.13  

Nonaccrual loans and OREO to total assets

     0.35     0.42     -0.07  

Net charge-offs (recoveries) to average loans

     0.09     0.06     0.03  

Equity to assets at period end

     8.74     9.73     -0.99  

Full time equivalent (FTE) employees

     121       117       3.42  
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