As filed with the Securities and Exchange Commission on November 4, 1996

Registration No. 333-12501

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
PRE-EFFECTIVE AMENDMENT NO. 1 TO FORM S-1
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933

HOME CITY FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)

            OHIO                            6036                   34-1839475
(State or other jurisdiction of  (Primary Standard Industrial   (I.R.S. employer
incorporation or organization)   Classification Code Number)    identification
                                                                number)
                               63 WEST MAIN STREET

SPRINGFIELD, OHIO 45502
(513) 324-5736
(Address, including Zip Code, and telephone number, including
area code, of registrant's principal executive offices)

DOUGLAS L. ULERY
HOME CITY FINANCIAL CORPORATION
63 WEST MAIN STREET
SPRINGFIELD, OHIO 45502
(513) 324-5736
(Name, address, including Zip Code, and telephone number,
including area code, of agent for service)

With copies to:
John C. Vorys, Esq.
Rick J. Landrum, Esq.
Vorys, Sater, Seymour and Pease
Atrium Two, 221 East Fourth Street
Cincinnati, Ohio 45202
(513) 723-4059

Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 of the Securities Act of 1933, check the following box: /X/

CALCULATION OF REGISTRATION FEE

- --------------------------------------------------------------------------------------------------------------
Title of each class                           Proposed maximum         Proposed maximum
of securities to be        Amount to           offering price             aggregate             Amount of
registered               be registered           per share             offering price(1)     registration fee
- --------------------------------------------------------------------------------------------------------------
Common shares,
without par value       952,200 shares            $10.00                  $9,522,000             $3,283
==============================================================================================================

(1) Estimated solely for the purpose of calculating the registration fee.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.


CROSS REFERENCE SHEET

Showing the location in the Prospectus of the Items of Form S-1

Form S-1 Item and Caption                                        Prospectus Heading
1. Forepart of the Registration Statement and Outside Front
     Cover Page of Prospectus ...............................    Cover Page

2. Inside Front and Outside Back Cover Pages of
     Prospectus .............................................    Cover Page, Back Cover Page

3. Summary Information, Risk Factors and Ratio of Earnings to
     Fixed Charges ..........................................    PROSPECTUS SUMMARY; RISK FACTORS

4. Use of Proceeds ..........................................    USE OF PROCEEDS

5. Determination of Offering Price ..........................    Cover Page; THE CONVERSION - Pricing and Number of
                                                                 Common Shares to be Sold

6. Dilution .................................................    Not Applicable

7. Selling Security Holders .................................    Not Applicable

8. Plans of Distribution ....................................    Cover Page; THE CONVERSION - General;




                                                                 - Subscription Offering;
                                                                 - Community Offering; and
                                                                 - Plan of Distribution

9. Description of Securities to be Registered ...............    DESCRIPTION OF AUTHORIZED SHARES

10.Interest of Named Experts and Counsel ....................    Not Applicable

11.Information with Respect to the Registrant

   (a)  Description of Business .............................    HOME CITY FINANCIAL CORPORATION; HOME CITY FEDERAL
                                                                 SAVINGS BANK OF SPRINGFIELD; THE BUSINESS OF HOME CITY

   (b)  Description of Property .............................    THE BUSINESS OF HOME CITY - Properties


   (c)  Legal Proceedings ...................................    THE BUSINESS OF HOME CITY - Legal Proceedings


   (d)  Market Price and Dividends ..........................    Cover Page; MARKET FOR THE COMMON SHARES; DIVIDEND
                                                                 POLICY




   (e)  Financial Statements ................................    Index to Financial Statements

   (f)  Selected Financial Data .............................    SELECTED CONSOLIDATED FINANCIAL INFORMATION AND OTHER
                                                                 DATA

   (g)  Supplementary Financial Information .................    Not Applicable


   (h)  Management's Discussion and Analysis of Financial
          Condition and Results of Operations ...............    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                                                                 CONDITION AND RESULTS OF OPERATIONS OF HOME CITY
   (i)  Changes in and Disagreements with Accountants on
          Accounting and Financial Disclosure ...............    Not Applicable

   (j)  Directors and Executive Officers ....................    MANAGEMENT OF HCFC;
                                                                 MANAGEMENT OF HOME CITY

   (k)  Executive Compensation ..............................    MANAGEMENT OF HOME CITY - Compensation; Stock Option
                                                                 Plan; Employee Stock Ownership Plan; Recognition and
                                                                 Retention Plan; Retirement Benefit Plans; and
                                                                 Employment Agreements

   (l)  Security Ownership of Certain Beneficial Owners and
          Management ........................................    THE CONVERSION - Shares to be Purchased by Management
                                                                 Pursuant to Subscription Rights
   (m)  Certain Relationships and Related
         Transactions .......................................    MANAGEMENT OF HOME CITY -
                                                                 Certain Transactions with Home City
12.Disclosure of Commission Position on Indemnification for
     Securities Act Liability ...............................    Not Applicable


PROSPECTUS HOME CITY FINANCIAL CORPORATION

(HOLDING COMPANY FOR HOME CITY FEDERAL SAVINGS BANK OF SPRINGFIELD)

UP TO 828,000 COMMON SHARES
$10 PURCHASE PRICE PER SHARE

Home City Financial Corporation, an Ohio corporation ("HCFC"), is hereby offering for sale up to 828,000 common shares, without par value (the "Common Shares"), in connection with its acquisition of all of the capital stock to be issued by Home City Federal Savings Bank of Springfield, a federal savings bank ("Home City"), upon the conversion of Home City from a mutual savings bank to a permanent capital stock savings bank chartered under the laws of the United States (the "Conversion"). The consummation of the Conversion and the sale of the Common Shares are subject to the approval of Home City's Plan of Conversion (the "Plan") and the adoption of the Federal Stock Charter and Federal Stock Bylaws of Home City at a Special Meeting of the members of Home City to be held at ____ p.m., Eastern Time, on ___________, 1996, at the office of Home City at 63 West Main Street, Springfield, Ohio (the "Special Meeting").

THE COMMON SHARES OFFERED HEREBY HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION (THE "SEC"), THE OFFICE OF THRIFT SUPERVISION OF THE DEPARTMENT OF THE TREASURY (THE "OTS"), THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE "FDIC"), OR THE SECURITIES COMMISSION OF ANY STATE, NOR HAS THE SEC, THE OTS, THE FDIC OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

Based on an independent appraisal of the pro forma market value of Home City, as converted, as of September 6, 1996, the aggregate purchase price of the Common Shares offered in connection with the Conversion ranges from a minimum of $6,120,000 to a maximum of $8,280,000 (the "Valuation Range"), resulting in a range of 612,000 to 828,000 Common Shares at $10.00 per share. The actual number of Common Shares sold in connection with the Conversion will be determined in the sole discretion of HCFC's Board of Directors and will be based upon the final valuation of Home City, as converted. The final valuation will be determined by the independent appraiser upon the completion of this offering. If the final valuation is within the Valuation Range, or does not exceed the maximum of the Valuation Range by more than 15%, the number of Common Shares to be issued in connection with the Conversion will not be less than 612,000, nor more than 952,200. If, due to changing market or regulatory conditions, the final valuation is not between the minimum of the Valuation Range and 15% above the maximum of the Valuation Range, subscribers will be given notice of such final valuation and the right to affirm, increase, decrease or rescind their subscriptions. Any such subscriber who does not affirmatively elect to continue his subscription or elects to rescind his subscription before the date specified in the notice will have all of his funds promptly refunded with interest. Any person who elects to decrease his subscription will have the appropriate portion of his funds promptly refunded with interest. See "THE CONVERSION - Pricing and Number of Common Shares to be Sold." Any upward or downward adjustment in the number of Common Shares sold will have a corresponding effect on the estimated net proceeds of the Conversion and the pro forma capitalization and book value per share of HCFC. See "USE OF PROCEEDS," "CAPITALIZATION" and "PRO FORMA DATA."

THE COMMON SHARES BEING OFFERED HEREBY ARE NOT SAVINGS ACCOUNTS OR SAVINGS DEPOSITS AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE "FDIC") OR ANY OTHER GOVERNMENT AGENCY.

FOR A DISCUSSION OF CERTAIN RISKS AND OTHER FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON SHARES, SEE "RISK FACTORS" BEGINNING AT PAGE 9 OF THIS PROSPECTUS.

FOR INFORMATION ON HOW TO SUBSCRIBE, CALL THE CONVERSION INFORMATION

CENTER AT (513) 324-3830.

===================================================================================================================================
                                                                          Estimated Underwriting
                                                 Subscription                   Commissions                    Estimated Net
                                                    Price                  And Other Expenses(1)                  Proceeds

- -----------------------------------------------------------------------------------------------------------------------------------
Per share Minimum                                   $10.00                         $0.58                           $9.42
Per share Mid-Point                                 $10.00                         $0.52                           $9.48
Per share Maximum                                   $10.00                         $0.47                           $9.53
Per share Maximum, as adjusted (2)                  $10.00                         $0.42                           $9.58
Total Minimum                                     $6,120,000                     $357,000                        $5,763,000
Total Mid-point                                   $7,200,000                     $372,000                        $6,828,000
Total Maximum                                     $8,280,000                     $387,000                        $7,893,000
Total Maximum, as adjusted (2)                    $9,522,000                     $404,000                        $9,118,000
===================================================================================================================================

(1) Consists of estimated printing, postage, legal, accounting, filing fee, appraisal and miscellaneous costs to Home City and HCFC in connection with the Conversion, including estimated fees, sales commissions and reimbursable expenses to be paid to Charles Webb & Company, a division of Keefe, Bruyette & Woods, Inc. ("Webb"), a company which has been engaged by Home City to consult, advise and assist in the sale of the Common Shares on a best efforts basis. Actual Conversion expenses may be more or less than estimated amounts. See "THE CONVERSION - Plan of Distribution."

(2) Gives effect to the increase in the number of Common Shares sold in connection with the Conversion of up to 15% above the maximum of the Valuation Range. Such shares may be offered without the resolicitation of persons who subscribe for Common Shares. See "THE CONVERSION - Pricing and Number of Common Shares to be Sold."

The date of this Prospectus is _______, 1996.

CHARLES WEBB & COMPANY
A Division of
Keefe, Bruyette & Woods, Inc.


In accordance with the Plan, nontransferable subscription rights to purchase Common Shares are offered hereby in a subscription offering to (a) each account holder who, as of June 30, 1995 (the "Eligibility Record Date"), had deposit accounts with deposit balances, in the aggregate, of $50 or more (a "Qualifying Deposit") with Home City; (b) the Home City Financial Corporation Employee Stock Ownership Plan (the "ESOP"); (c) each account holder who, as of September 30, 1996 (the "Supplemental Eligibility Record Date"), had a Qualifying Deposit with Home City; and (d) each depositor of Home City having a savings deposit of record on October 31, 1996 (the "Voting Record Date") and borrowers of Home City of record on the Voting Record Date whose loan was outstanding on May 1, 1996 (the "Subscription Offering"). All subscription rights to purchase Common Shares in the Subscription Offering are nontransferable and will expire at 4:00 p.m., Eastern Time, on _______________ (the "Subscription Expiration Date"), unless extended. PERSONS FOUND TO BE TRANSFERRING SUBSCRIPTION RIGHTS WILL BE SUBJECT TO FORFEITURE OF SUCH RIGHTS AND POSSIBLE FURTHER PENALTIES IMPOSED BY THE OTS. See "THE CONVERSION -
Subscription Offering."

To the extent that all of the Common Shares are not subscribed for in the Subscription Offering, the remaining shares are hereby concurrently being offered to the general public in a direct community offering in which preference will be given to natural persons residing in Clark County, Ohio (the "Community Offering"). See "THE CONVERSION - Community Offering." If the Community Offering extends beyond ________, 1997, 45 days after the Subscription Expiration Date, persons who have subscribed for Common Shares in the Subscription Offering or in the Community Offering will receive a notice that, until a date specified in the notice, they have the right to affirm, increase, decrease or rescind their subscriptions for Common Shares. Any person who does not affirmatively elect to continue his subscription or elects to rescind his subscription during any such extension will have all of his funds promptly refunded with interest. Any person who elects to decrease his subscription will have the appropriate portion of his funds promptly refunded with interest. See "THE CONVERSION - Effect of Extension of Community Offering." The Community Offering may end at any time after orders for at least 952,200 Common Shares have been received, but in no event later than 45 days after the Subscription Expiration Date or __________, 1997, unless extended by HCFC and Home City with the approval of the OTS, if necessary. In accordance with the Plan, the Subscription Offering and the Community Offering may not be extended beyond ___________, 1997. See "THE CONVERSION - Subscription Offering; and - Plan of Distribution."

Home City has engaged Webb to consult, advise and assist in the sale of the Common Shares on a best efforts basis in the Subscription Offering and the Community Offering (together, the "Offering"). See "THE CONVERSION - Plan of Distribution."

The Plan and federal regulations limit the number of Common Shares which may be purchased by various categories of persons, including the limitation that no person may purchase fewer than 25 shares, nor more than 1%, in the Subscription Offering or the Community Offering, of the total number of Common Shares sold in connection with the Conversion (9,522 Common Shares at the maximum of the Valuation Range, as adjusted). In addition, no person, together with such person's Associates (hereinafter defined) and persons Acting in Concert (hereinafter defined) with such person, may purchase more than 2% of the total number of Common Shares sold in connection with the Conversion (19,044 Common Shares at the maximum of the Valuation Range, as adjusted). Such limitations do not apply to the ESOP. SUBJECT TO APPLICABLE OTS REGULATIONS, THE LIMITATIONS SET FORTH IN THE PLAN MAY BE CHANGED AT ANY TIME IN THE SOLE DISCRETION OF THE BOARD OF DIRECTORS OF HOME CITY AND HCFC. See "THE CONVERSION
- - Limitations on Purchases of Common Shares."

Common Shares may be subscribed for in the Subscription Offering or ordered in the Community Offering only by returning the accompanying Stock Order Form and Certification Form (the "Stock Order Form"), along with full payment of the subscription or order price per share for all shares for which subscription is made or order is submitted, no later than 4:00 p.m., Eastern Time, _________, 1996. See "THE CONVERSION - Use of Stock Order Forms." Payment may be made in cash or by check or money order and will be held in a segregated account at Home City, insured by the FDIC up to the applicable limit and earning interest at Home City's passbook rate, currently 2.5% annual percentage yield, from the date of receipt until the completion of the Conversion. Payment may also be made by authorized withdrawal from an existing Home City savings account, the amount in which will continue to earn interest until completion of the Conversion at the rate normally in effect from time to time for such account. Neither payments made in cash or by check or money order, nor payments made by authorized withdrawal from an account at Home City will be available during the Subscription Offering and the Community Offering. See "THE CONVERSION - Payment for Common Shares." Payment by wire will not be accepted. AN EXECUTED STOCK ORDER FORM, ONCE RECEIVED BY HCFC, MAY NOT BE MODIFIED, AMENDED OR RESCINDED WITHOUT THE CONSENT OF HCFC UNLESS THE COMMUNITY OFFERING IS NOT COMPLETED WITHIN 45 DAYS AFTER THE SUBSCRIPTION EXPIRATION DATE.

There is presently no market for the Common Shares and no assurance can be given that an active and liquid trading market will develop. The aggregate offering price for the Common Shares is based upon an independent appraisal of Home City performed by Keller & Company, Inc. ("Keller"). The appraisal is not a recommendation as to the advisability of purchasing Common Shares. See "THE CONVERSION - Pricing and Number of Common Shares to be Sold." No assurance can be given that persons purchasing Common Shares will thereafter be able to sell such shares at a price at or above the offering price. See "RISK FACTORS - Limited Market for the Common Shares."

In connection with the completion of the Conversion, HCFC will register the Common Shares with the SEC under the Securities Exchange Act of 1934 (the "Exchange Act"). The Exchange Act requires that HCFC file an Annual Report on Form 10-KSB with the SEC containing audited consolidated financial statements and other information concerning the consolidated financial condition and operations of HCFC and its subsidiaries. HCFC will also be subject to the proxy solicitation rules of the SEC, including the requirement that HCFC provide its shareholders with an Annual Report containing audited consolidated financial statements and management's discussion and analysis of financial condition and results of operations. OTS regulations require that the Common Shares remain registered for at least three years after the completion of the Conversion. In the unlikely event that HCFC has fewer than 300 shareholders of record at the expiration of such three-year period, HCFC may deregister the Common Shares.

THE CONVERSION OF HOME CITY FROM A MUTUAL SAVINGS BANK TO A PERMANENT

CAPITAL STOCK SAVINGS BANK IS CONTINGENT UPON (I) THE APPROVAL OF THE PLAN AND THE ADOPTION OF THE FEDERAL STOCK CHARTER AND FEDERAL STOCK BYLAWS BY HOME CITY'S VOTING MEMBERS, (II) THE SALE OF THE REQUISITE NUMBER OF COMMON SHARES, AND (III) THE SATISFACTION OR WAIVER OF CERTAIN OTHER CONDITIONS. SEE "THE CONVERSION."

-ii-

HOME CITY FEDERAL SAVINGS BANK OF SPRINGFIELD

SPRINGFIELD, OHIO

[MAP OF CLARK COUNTY, OHIO]


PROSPECTUS SUMMARY

The following information is not complete and is qualified in its entirety by the detailed information and the financial statements and accompanying notes appearing elsewhere in this Prospectus:

HOME CITY FINANCIAL CORPORATION

HCFC was incorporated under Ohio law in August 1996 at the direction of Home City for the purpose of purchasing all of the capital stock of Home City to be issued in connection with the Conversion. HCFC has not conducted and will not conduct any business before the completion of the Conversion other than business related to the Conversion. Upon the consummation of the Conversion, HCFC will be a unitary savings and loan holding company, the principal assets of which initially will be the capital stock of Home City, a loan made to the ESOP for the purchase of Common Shares and the investments made with 50% of the net proceeds retained from the sale of HCFC shares in connection with the Conversion. See "USE OF PROCEEDS."

The main office of HCFC is located at 63 West Main Street, Springfield, Ohio 45502-1309, and its telephone number is (513) 324-5736.

HOME CITY FEDERAL SAVINGS BANK OF SPRINGFIELD

Home City is a federal mutual savings bank which has served the Springfield, Ohio, area since 1925. Originally formed under the name "Home City Savings and Loan Association," Home City changed its name on May 1, 1996, to "Home City Savings Bank."

As a federal savings bank, Home City is subject to supervision and regulation by the OTS and the FDIC and is a member of the Federal Home Loan Bank (the "FHLB") of Cincinnati. The deposits of Home City are insured up to applicable limits by the FDIC in the Savings Association Insurance Fund (the "SAIF"). See "REGULATION." At June 30, 1996, $31.9 million, or approximately 66% of Home City's loan portfolio, consisted of loans secured by first mortgages on one- to four-family homes, virtually all of which were located within Clark County, Ohio, and adjacent counties. See "THE BUSINESS OF HOME CITY - Lending Activities -- One- to Four-Family Real Estate Loans."

Home City's capital exceeds by a substantial margin all regulatory requirements. At June 30, 1996, Home City's tangible and core capital both equaled $5.4 million, or 9.8% of assets, an amount which exceeded the minimum tangible and core capital requirements by approximately $4.4 million and $3.6 million, respectively. On a pro forma basis, assuming the sale of 720,000 Common Shares (the mid-point of the Valuation Range) and the retention by HCFC of 50% of the net proceeds from such sale, Home City's tangible and core capital ratios will both equal 13.45%. See "REGULATORY CAPITAL COMPLIANCE," "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF HOME
CITY Liquidity and Capital Resources," and "REGULATION - OTS Regulations -- Regulatory Capital Requirements."

Home City conducts business from its office in Springfield, Ohio. Home City's primary market area consists of Clark County, Ohio, and adjacent counties. The office of Home City is located at 63 West Main Street, Springfield, Ohio, and its telephone number is (513) 324-5736.

THE CONVERSION

On September 3, 1996, the Board of Directors of Home City unanimously approved the Plan of Conversion. The OTS approved the Plan, subject to the approval of the Plan by Home City's voting members at the Special Meeting, to be held at ____ p.m., Eastern Time, on ___________, 1996, at the offices of Home City at 63 West Main Street, Springfield, Ohio.

THE SUBSCRIPTION AND COMMUNITY OFFERINGS

The Plan provides for the formation of HCFC for the purpose of acquiring all of the capital stock to be issued by Home City in the Conversion. Pursuant to the Plan, subscription rights to purchase Common Shares are hereby offered at a price of $10 per share to (a) depositors of Home City with Qualifying Deposits as of June 30, 1995 ("Eligible Account Holders"), (b) the ESOP, (c) depositors of Home City with Qualifying Deposits as of September 30, 1996 ("Supplemental Eligible Account Holders"), and (d) account holders of Home City having savings deposits of record on October 31, 1996 (the "Voting Record Date"), and borrowers of record on the Voting Record Date whose loans were outstanding on May 1, 1996 (such depositors and


borrowers as of October 31, 1996, collectively, the "Voting Members"). See "THE CONVERSION Subscription Offering." Common Shares not subscribed for in the Subscription Offering are hereby being concurrently offered to those members of the general public receiving this Prospectus in the Community Offering, in which preference will be given to natural persons residing in Clark County, Ohio. See "THE CONVERSION - Community Offering."

The Plan authorizes the Boards of Directors of HCFC and Home City to establish limits on the number of Common Shares that may be purchased by various categories of persons. The Plan also permits the Board of Directors of HCFC and Home City, subject to any required regulatory approval and the requirements of applicable laws and regulations, to increase or decrease such purchase limitations in their sole discretion. Pursuant to such authority, the Boards of Directors have established the limitation that, generally, an Eligible Account Holder or a Supplemental Eligible Account Holder may purchase in the Subscription Offering a number of Common Shares equal to the greater of (i) 1% of the Common Shares sold in connection with the Conversion (9,522 Common Shares at the maximum of the Valuation Range, as adjusted) or (ii) 15 times the product (rounded down to the next whole number) obtained by multiplying the total number of Common Shares to be sold in connection with the Conversion by a fraction, the numerator of which is the amount of such Eligible Account Holder's or Supplemental Eligible Account Holder's Qualifying Deposit and the denominator of which is the total amount of Qualifying Deposits of all Eligible Account Holders or Supplemental Eligible Account Holders, as the case may be. A Voting Member may purchase in the Subscription Offering 1% of the Common Shares sold in connection with the Conversion (9,522 Common Shares at the maximum of the Valuation Range, as adjusted).

The Board of Directors has also established the limitation that any person may purchase in the Community Offering a number of Common Shares equal to 1% of the total number of Common Shares sold in connection with the Conversion (9,522 Common Shares at the maximum of the Valuation Range, as adjusted).

Subscriptions and orders for Common Shares in the Conversion are also subject to the limitation that no person, together with any Associates or persons Acting in Concert, may purchase more than 2% of the Common Shares sold in connection with the Conversion (19,044 Common Shares at the maximum of the Valuation Range, as adjusted). Such limitation does not apply to the ESOP, which intends to purchase 8% of the Common Shares sold in connection with the Conversion. The ESOP may purchase Common Shares if shares remain available after satisfying the subscriptions of Eligible Account Holders up to $8,280,000, the maximum of the Valuation Range. If Common Shares in excess of the maximum of the Valuation Range are sold, the ESOP will have the first right to purchase such excess Common Shares. If the ESOP is unable to purchase all or part of the Common Shares for which it subscribes, the ESOP may purchase Common Shares in the open market or may purchase authorized but unissued Common Shares from HCFC. If the ESOP purchases authorized but unissued Common Shares from HCFC, such purchases could have a dilutive effect on the interest of HCFC's shareholders. Subject to applicable regulations, the purchase limitations may be increased or decreased after the commencement of the Offering in the sole discretion of the Boards of Directors. See "THE CONVERSION - Limitations on Purchases of Common
Shares" and "RESTRICTIONS ON ACQUISITION OF HCFC AND HOME CITY." The sale of Common Shares pursuant to subscriptions or orders received in the Offering will be subject to the approval of the Plan by the voting members of Home City at the Special Meeting, to the sale of the requisite number of Common Shares and to certain other conditions. See "THE CONVERSION - Subscription Offering; - Community Offering; and - Pricing and Number of Common Shares to be Sold."

Home City has retained Webb to consult, advise and assist in the sale of the Common Shares in the Subscription Offering and in the Community Offering. Webb has been paid a management fee of $25,000 and will receive a commission equal to 1.5% of the aggregate amount received by HCFC in the Offering, excluding any amounts paid for Common Shares by Home City's directors, executive officers and employees (and members of their immediate families) and by the ESOP. Home City will reimburse Webb for legal and out-of-pocket expenses. See "THE CONVERSION - Plan of Distribution."

The Subscription Offering will terminate at 4:00 p.m., Eastern Time, on _________, 1996. The Community Offering may be terminated at any time after orders for at least 952,200 shares have been received, but in no event later than __________, 1996, unless extended. If the Community Offering extends beyond 45 days after the Subscription Expiration Date, persons who have subscribed for Common Shares in the Subscription Offering or in the Community Offering will receive a notice that, until a date specified in the notice, they have the right to affirm, increase, decrease or rescind their subscriptions or orders for Common Shares. Any person who does not affirmatively elect to continue his subscription or order or elects to rescind his subscription or order during such time will have all of his funds promptly refunded with interest. Any person who elects to decrease his subscription or order will have the appropriate portion of his funds promptly refunded with interest. The sale of Common Shares pursuant to subscriptions or orders received in the Offering will be subject to the approval of the Plan by the voting members of Home City at the Special Meeting, to the determination by the Board of Directors of HCFC of the total number of Common

-2-

Shares to be sold and to the satisfaction or waiver of certain other conditions. See "THE CONVERSION - Subscription Offering; - Community Offering; and - Pricing and Number of Common Shares to be Sold."

Assuming 720,000 Common Shares are sold in connection with the Conversion, all directors and executive officers of HCFC and Home City and their Associates intend to purchase an aggregate amount of 75,000 Common Shares in connection with the Conversion, which would constitute 10.4% of the Common Shares sold. The aggregate number of Common Shares proposed to be purchased by the directors, the executive officers and the ESOP is 132,600, which would constitute 18.4% of the Common Shares sold. Such percentages may increase or decrease if more or less than 720,000 Common Shares are sold in the Conversion. See "THE CONVERSION -- Shares to be Purchased by Management Pursuant to Subscription Rights."

NON-TRANSFERABILITY OF SUBSCRIPTION RIGHTS

Federal regulations prohibit any person from transferring or entering into any agreement or understanding before the completion of the Conversion to transfer the ownership of the subscription rights issued in the Conversion or the shares to be issued upon the exercise of such subscription rights. Persons attempting to violate such provision may lose their rights to purchase Common Shares in the Conversion and may be subject to penalties imposed by the OTS. Each person exercising subscription rights will be required to certify that a purchase of Common Shares is solely for the subscriber's own account and that there is no agreement or understanding regarding the sale or transfer of such Common Shares.

PRICING OF THE COMMON SHARES

Keller, an independent firm experienced in valuing thrift institutions, has prepared a valuation of the estimated pro forma market value of Home City, as converted. Keller's valuation of the estimated pro forma market value of Home City, as converted, is $7,200,000 as of September 6, 1996 (the "Pro Forma Value"). The Board of Directors reviewed the valuation, including the methodology and the appropriateness of the assumptions used by Keller, and determined that the valuation was not unreasonable. HCFC will issue the Common Shares at a fixed price of $10 per share and, by dividing the price per share into the Pro Forma Value, will determine the number of shares to be issued. Applicable regulations require, however, that Home City establish a range of 15% above and below the Pro Forma Value to allow for fluctuations in the aggregate value of the Common Shares due to changes in the market for thrift shares and other factors from the time of the commencement of the Subscription Offering until the completion of the offering of the Common Shares. Based on the Pro Forma Value of Home City as of September 6, 1996, the Valuation Range is $6,120,000 to $8,280,000, resulting in the offer of between 612,000 and 828,000 Common Shares at a purchase price of $10 per share. The valuation should not be considered a recommendation as to the advisability of purchasing the Common Shares. Keller has assumed and relied upon the accuracy and completeness of the financial information provided by Home City and did not independently value Home City's assets and liabilities.

The actual number of Common Shares sold in connection with the Conversion will be determined in the discretion of HCFC's Board of Directors upon the completion of the Subscription Offering and the Community Offering, if any, and will be based upon the final valuation of Home City, as converted. The final valuation will be determined by Keller at the time of the closing of the Offering. If the final valuation is within the Valuation Range, or does not exceed the maximum of the Valuation Range by more than 15%, the number of Common Shares to be issued in connection with the Conversion will not be less than 612,000 or more than 952,200. If, due to changing market conditions, the final valuation is not between the minimum of the Valuation Range and 15% above the maximum of the Valuation Range, subscribers will be given the opportunity to affirm, increase, decrease or rescind their subscriptions. See "THE CONVERSION - Pricing and Number of Common Shares to be Sold." If the final valuation is between the minimum and 15% above the maximum of the Valuation Range, subscribers will not be permitted to increase, decrease or rescind their subscriptions.

USE OF PROCEEDS

HCFC will retain 50% of the net proceeds from the sale of the Common Shares, or approximately $3,414,000 at the mid-point of the Valuation Range, including the value of a promissory note from the ESOP, which HCFC intends to accept in exchange for the issuance of Common Shares to the ESOP. Such proceeds will be used to fund the Home City Financial Corporation Recognition and Retention Plan (the "RRP") and will be invested in short-term and intermediate-term government securities.

The remainder of the net proceeds received from the sale of the Common Shares, $3,414,000 at the mid-point of the Valuation Range, will be invested by HCFC in the capital stock to be issued by Home City to HCFC as a result of the Conversion. Such investment will increase the regulatory capital of Home City and will permit Home City to expand its lending

-3-

and investment activities. Home City anticipates that such net proceeds initially will be invested in short-term interest-bearing deposits. Eventually, however, Home City will attempt to use such net proceeds to originate mortgage, consumer and other loans in Home City's market area. Home City may also use the proceeds from the Conversion to expand operations through the establishment of a branch office, which would include space for administrative operations. Home City estimates that the cost of establishing a new branch will be approximately $1.25 million, including land acquisition and construction costs. Neither HCFC nor Home City has, however, entered into any agreements concerning the establishment of a branch office. Although HCFC and Home City could use the proceeds from the Conversion to acquire other financial institutions or for HCFC to purchase its own outstanding shares, HCFC and Home City have no current intentions to do so. See "USE OF PROCEEDS."

OFFICER AND DIRECTOR BENEFITS

In connection with the Conversion, HCFC will establish the ESOP. Common Shares will be purchased by the ESOP in the Conversion with a loan from HCFC. The ESOP intends to repay the loan with discretionary contributions made by Home City to the ESOP. As the loan is repaid, the Common Shares held by the ESOP will be allocated to the accounts of employees of Home City and HCFC, including executive officers. See "MANAGEMENT OF HOME CITY - Employee Stock Ownership Plan."

At a meeting of the shareholders of HCFC to be held at least six months after the consummation of the Conversion, the Boards of Directors of HCFC and Home City intend to present to the shareholders for approval both the RRP and the Home City Financial Corporation 1997 Stock Option and Incentive Plan (the "Stock Option Plan"). If the RRP is approved at such meeting, HCFC will form a trust (the "RRP Trust") to which HCFC will contribute sufficient amounts for the purchase by the RRP Trust of an unspecified number of HCFC common shares equal to up to 4% of the number of Common Shares sold in the Conversion. Such HCFC common shares may be purchased after shareholder approval of the RRP in the open market or from the authorized, but unissued, common shares of HCFC, and will be awarded by a committee of the HCFC Board of Directors to the officers and directors of HCFC and Home City for services rendered to Home City. See "MANAGEMENT OF HOME CITY - Stock Option Plan; and - Recognition and Retention Plan and Trust."

If the Stock Option Plan is approved at a meeting of shareholders following the Conversion, directors, officers and employees of HCFC and Home City will be granted options to purchase, in the aggregate, a number of Common Shares equal to up to 10% of the Common Shares sold in the Conversion. The exercise price for options granted will equal the HCFC market price on the date of grant. The grant of such options, in combination with purchases of Common Shares by such officers and directors and certain anti-takeover provisions in the Articles of Incorporation and Code of Regulations of HCFC and the Amended Charter of Home City, may facilitate the perpetuation of current management and discourage proxy contests and takeover attempts. See "RESTRICTIONS ON ACQUISITIONS OF HOME CITY AND HCFC AND RELATED ANTI-TAKEOVER PROVISIONS."

Assuming the purchase by directors and executive officers of 10.4% of the Common Shares sold at the mid-point of the Valuation Range, the purchase by the RRP of a number of Common Shares equal to 4% of the Common Shares sold in the Conversion, the exercise by directors and executive officers of all options authorized pursuant to the Stock Option Plan and the control by directors and executive officers of the 8% of the Common Shares purchased by the ESOP in the Conversion, directors and executive officers could own or control up to 29.5% of the outstanding common shares of HCFC. See "RISK FACTORS-Controlling Influence of Management and Anti-Takeover Provisions Which May Discourage Sales of Common Shares for Premium Prices."

MARKET FOR THE COMMON SHARES

There is presently no market for the Common Shares. The aggregate offering price for the Common Shares is based upon an independent appraisal of Home City. The appraisal is not a recommendation as to the advisability of purchasing Common Shares. See "THE CONVERSION - Pricing and Number of Common Shares to be Sold." No assurance can be given that persons purchasing Common Shares will thereafter be able to sell such shares at a price at or above the $10 offering price.

HCFC has received approval to have the Common Shares quoted on The Nasdaq Small Cap Market under the symbol "__________" upon the closing of the Conversion, subject to certain conditions which HCFC and Home City believe will be satisfied, although no assurance can be provided that the conditions will be met. In connection with such approval, Webb has informed Home City that Keefe, Bruyette & Woods, Inc., intends to make a market in the Common Shares. No assurance can be given, however, that an active or liquid market for the Common Shares will develop after the completion of the Conversion or, if such a market does develop, that such market will continue. Investors should consider, therefore, the potentially illiquid and long-term nature of an investment in the Common Shares. See "RISK FACTORS - Market for the Common Shares."

-4-

DIVIDEND POLICY

The declaration and payment of dividends by HCFC will be subject to the discretion of the Board of Directors of HCFC and will be based on the earnings and financial condition of HCFC and general economic conditions. Other than the earnings on the investment of proceeds retained by HCFC, the only source of income of HCFC will be dividends periodically declared and paid by the Board of Directors of Home City on the common shares of Home City owned by HCFC. The payment of dividends by Home City to HCFC will be subject to various regulatory restrictions. On a pro forma basis, as of June 30, 1996, assuming (i) receipt by Home City of $3.4 million of net conversion proceeds, (ii) the investment of such net proceeds in assets having a risk weighting of 20% and (iii) the establishment of a Liquidation Account (hereinafter defined) in the amount of $5.4 million (the regulatory capital of Home City at June 30, 1996), Home City would have $4.19 million available for the payment of dividends to HCFC.

In an effort to manage the capital of HCFC, the Board of Directors of HCFC may determine that the payment of a regular or a special cash dividend or both may be prudent. No assurance can be given, however, that any dividend will be declared, what the amount will be or whether such dividends, if declared, will continue in the future. See "DIVIDEND POLICY."

INVESTMENT RISKS

Special attention should be given to the matters discussed under "RISK FACTORS," beginning on page 9, prior to investing in the Common Shares.

-5-

SELECTED CONSOLIDATED FINANCIAL INFORMATION AND OTHER DATA

The following tables set forth certain information concerning the consolidated financial condition, earnings and other data regarding Home City at the dates and for the periods indicated. The financial information should be read in conjunction with the consolidated financial statements and notes thereto included elsewhere herein. In addition, the financial information should be read in conjunction with the "Recent Developments" section, beginning on page 31, for the impact of the special SAIF assessment on Home City's capital and earnings for the three months ended September 30, 1996. However, in the opinion of management of Home City, all adjustments necessary for a fair presentation of such financial data have been included. All such adjustments are of a normal recurring nature.

SELECTED FINANCIAL CONDITION
AND OTHER DATA:

                                                                              At June 30,
                                                  -------------------------------------------------------------------
                                                    1996           1995           1994          1993           1992
                                                  -------        -------        -------        -------        -------
                                                                         (Dollars in thousands)

Total amount of:
  Assets                                          $55,728        $48,578        $39,680        $40,769        $42,325
  Cash and cash equivalents (1)                     1,843          2,377            987          3,358          5,889
  Investment securities available for sale          2,188            259            314          1,398             20
  Investment securities held to maturity               --          1,901          2,098          2,473          4,484
  Mortgage-backed securities
     available for sale                             2,975             --             --             --             --
  Mortgage-backed securities

     held to maturity                                  --          3,667          4,257          5,314          2,064
  Loans receivable - net                           45,225         38,960         31,103         28,648         28,875
  FHLB stock - at cost                                394            288            248            216            205
  Deposits                                         47,174         40,936         34,816         36,688         39,398
  FHLB advances                                     2,903          2,618            424            460             --
  Retained earnings, substantially
    restricted-net (2)                              5,271          4,757          4,202          3,497          2,832

  Number of offices, all full service                   1              1              1              1              1

                                                                 At June 30,
                                     ---------------------------------------------------------------
SUMMARY OF EARNINGS:                   1996           1995           1994          1993        1992
                                     -------        -------        -------        -------    -------
                                                               (In thousands)



Interest income                       $4,507        $3,835        $3,542        $3,565        $3,439
Interest expense                       2,542         1,942         1,446         1,710         2,370
                                      ------        ------        ------        ------        ------
Net interest income                    1,965         1,893         2,096         1,855         1,069
Provision for loan losses                 50           109           113            83            52
                                      ------        ------        ------        ------        ------
Net interest income after
     provision for loan losses         1,915         1,784         1,983         1,772         1,017
Noninterest income                        58             9            12            44             1
Noninterest expense                    1,216           998           923           727           845
                                      ------        ------        ------        ------        ------
Income  before income tax                757           795         1,072         1,089           173
Income tax expense (2)                   243           240           367           424            73
                                      ------        ------        ------        ------        ------
Net income (2)                        $  514        $  555        $  705        $  665        $  100
                                      ======        ======        ======        ======        ======


(Footnotes on next page)

-6-

                                                              At or for the year ended June 30,
                                              -----------------------------------------------------------
SELECTED FINANCIAL RATIOS:                     1996         1995          1994         1993         1992
                                              ------       ------        ------        -----       ------

Return on assets (3)                            0.98%        1.24%         1.69%        1.66%        0.26%
Return on equity (4)                           10.46        12.20         17.23        21.08         3.52
Interest rate spread (5)                        3.42         3.95          4.88         4.58         3.12
Net interest margin (6)                         3.86         4.36          5.28         4.81         2.92
Noninterest expense to average assets (7)       2.31         2.22          2.28         1.82         2.21
Average equity to average assets                9.55        10.21         10.09         7.88         7.42
Equity to assets at period end                  9.69        10.06         10.87         8.58         6.69
Nonperforming loans to total loans              0.54         0.53          0.11         1.35         0.17
Nonperforming assets to total assets (8)        0.44         0.43          0.09         0.96         0.12
Allowance for loan losses to total loans        0.80         0.82          0.74         0.69         0.38
Allowance for loan losses to
  nonperforming loans                         146.56       154.11        673.53        50.77       222.00
Net charge-offs to average loans                0.02         0.05          0.27        (0.01)           -


(1) Includes cash and amounts due from depository institutions and interest-bearing deposits in other financial institutions.

(2) Effective January 1, 1993, Home City adopted Statement of Financial Accounting Standards ("SFAS") No. 109, "Accounting for Income Taxes". The effect of adopting SFAS No. 109 on income tax expense in 1994 and 1993 was not material.

(3) Net income divided by average total assets.

(4) Net income divided by average total equity.

(5) Average yield on interest-earning assets less average cost of interest-bearing liabilities.

(6) Net interest income as a percentage of average interest-earning assets.

(7) Noninterest expense divided by average total assets.

(8) Nonperforming assets consist of nonaccruing loans, accruing loans 90 days or more past due and real estate acquired (or deemed acquired) in foreclosure proceedings or in lieu thereof. See "THE BUSINESS OF HOME CITY - Delinquent Loans, Nonperforming Assets and Classified Assets."

-7-

REGULATORY CAPITAL COMPLIANCE

The following table sets forth the historical and pro forma regulatory capital of Home City at June 30, 1996, based on the receipt of proceeds for the number of Common Shares indicated, less estimated expenses of $357,000, $372,000, $387,000 and $404,000 at the minimum, mid-point, maximum and maximum, as adjusted, of the Valuation Range, respectively, assuming all of such shares are sold in the Subscription Offering.

                                                                   Pro forma capital at June 30, 1996, assuming the sale of
                                                      -----------------------------------------------------------------------------
                                                          612,000            720,000             828,000              952,200
                                                       Common Shares      Common Shares       Common Shares        Common Shares
                                    Historical at      (offering price    (offering price     (offering price      (offering price
                                    June 30, 1996         of $10 per         of $10 per          of $10 per           of $10 per
                                        (1)                share)             share)              share)               share)
                                   ----------------   ----------------    ----------------    ----------------    -----------------
                                   Amount   Percent   Amount   Percent    Amount   Percent    Amount   Percent    Amount    Percent
                                   ------   -------   ------   -------    ------   -------    ------   -------    ------    -------
                                                                   (Dollars in thousands)

Capital under
generally
accepted accounting
 principles, before                $5,398     9.68%    $7,545    13.07%    $7,545    13.67%    $8,351    14.27%    $8,847    14.99%
 adjustments (2)(3)

Current tangible
 capital (2)(3):
  Capital level                    $5,271     9.48%    $7,418    12.85%    $7,821    13.45%    $8,224    14.05%    $8,720    14.77%
  Requirement                         834     1.50        866     1.50        872     1.50        878     1.50        886     1.50
                                   ------    -----     ------    -----     ------    -----     ------    -----     ------    -----
  Excess                           $4,437    7. 98%    $6,552    11.35%    $6,949    11.95%    $7,346    12.55%    $7,834    13.27%
                                   ======    =====     ======    =====     ======    =====     ======    =====     ======    =====

Current core
 capital (2)(3):
  Capital level                    $5,271     9.48%    $7,418    12.85%    $7,821    13.45%    $8,224    14.88%    $8,720    15.83%
  Requirement                       1,668     3.00      1,732     3.00      1,744     3.00      1,756     3.00      1,771     3.00
                                   ------    -----     ------    -----     ------    -----     ------    -----     ------    -----
  Excess                           $3,603     6.48%    $5,686     9.85%    $6,077    10.45%    $6,468    11.88%    $6,949    11.77%
                                   ======    =====     ======    =====     ======    =====     ======    =====     ======    =====

Current risk-based
 capital (4):
  Capital level                    $5,633    18.77%    $7,780    25.57%    $8,183    26.82%    $8,586    28.07%    $9,082    29.59%
  Requirement                       2,400     8.00      2,434     8.00      2,441     8.00      2,447     8.00      2,455     8.00
                                   ------    -----     ------    -----     ------    -----     ------    -----     ------    -----
  Excess                           $3,233    10.77%    $5,346    17.57%    $5,742    18.82%    $6,139    20.07%    $6,627    21.59%
                                   ======    =====     ======    =====     ======    =====     ======    =====     ======    =====


(1) See Note N of the Notes to Financial Statements.

(2) Pro forma amounts assume Home City will receive 50% of the conversion proceeds before reduction for the ESOP loan. Also reflects a deduction from capital for unearned ESOP shares equal to 8% of the shares offered and unearned RRP shares equal to 4% of the shares offered.

(3) Historical tangible and core capital percentages are based on adjusted total assets of $56.0 million. Pro forma tangible and core capital percentages are based on adjusted total assets of $52.7 million, $58.1 million, $58.5 million, and $59.0 million, which assumes the receipt by Home City of net proceeds from the sale of Common Shares of $2.9 million, $3.4 million, $3.9 million and $4.6 million, at the minimum, mid-point, maximum and maximum, as adjusted, of the Valuation Range, respectively. The OTS has proposed a new regulation which would increase the core capital requirement to between 4% and 5% of adjusted total assets, with the specific requirement to be determined on a case-by-case basis. See "REGULATION - OTS Regulations -- Regulatory Capital Requirements."

(4) Historical risk-based capital percentages are based on risk-weighted assets of $30.0 million. Pro forma risk-based capital percentages are based on the receipt by Home City of net proceeds of $2.9 million, $3.4 million, $3.9 million and $4.6 million, and assumes the net proceeds will be invested in short-term interest-bearing deposits having a risk weighting of 20%.

-8-

RISK FACTORS

Investment in the Common Shares involves certain risks. Before investing, prospective purchasers should consider carefully the following matters, in addition to the other information discussed elsewhere in this Prospectus:

INTEREST RATE RISK

Home City's operating results are dependent to a significant degree on its net interest income, which is the difference between interest income from loans and investments and interest expense on deposits. Like most thrift institutions, the interest income and interest expense of Home City change as the interest rates on mortgages, securities and other assets and on deposits and other liabilities change. Interest rates may change because of general economic conditions, the policies of various regulatory authorities and other factors beyond Home City's control. The interest rates on specific assets and liabilities of Home City will change or "reprice" in accordance with the contractual terms of the asset or liability instrument and in accordance with customer reaction to general economic trends.

Home City, like other financial institutions, is subject to interest rate risk to the extent that its interest-earning assets reprice differently than its interest-bearing liabilities. As part of its effort to monitor and manage interest rate risk, Home City uses the "net portfolio value" ("NPV") methodology recently adopted by the OTS as part of its capital regulations. Although Home City is not currently subject to the NPV regulation because such regulation does not apply to institutions with less than $300 million in assets and risk-based capital in excess of 12%, the application of the NPV methodology may illustrate Home City's interest rate risk.

Generally, NPV is the difference between incoming cash flows on interest-earning and other assets and outgoing cash flows on interest-bearing and other liabilities, discounted to their economic value. The application of the methodology attempts to quantify interest rate risk as the change in the NPV which would result from a theoretical 200 basis point (1 basis point equals .01%) change in market interest rates. Both a 200 basis point increase in market interest rates and a 200 basis point decrease in market interest rates are considered. If the NPV would decrease more than 2% of the economic value of the institution's assets with either an increase or a decrease in market rates, the institution must, in determining its risk-based capital, deduct from its capital 50% of the amount of the decrease in excess of such 2%.

At June 30, 1996, 2% of the economic value of Home City's assets was approximately $1.2 million. Because the interest rate risk of a 200 basis point increase in market interest rates (which was greater than the interest rate risk of a 200 basis point decrease) was $1.6 million at June 30, 1996, Home City would have been required to deduct approximately $200,000 (half of the approximate $400,000 difference) from its capital in determining whether Home City met its risk-based capital requirement. Regardless of such reduction, however, Home City's risk-based capital at June 30, 1996, would still have exceeded the regulatory requirement by approximately $ 3.0 million.

Home City's NPV is more sensitive to rising rates than declining rates. Such difference in sensitivity occurs principally because, as rates rise, borrowers do not prepay fixed-rate loans as quickly as they do when interest rates are declining. Because Home City has not originated loans in accordance with traditional secondary market guidelines, the sale of fixed-rate loans may be difficult. As a result, in a rising interest rate environment, the amount of interest Home City would receive on its loans would increase relatively slowly as loans are slowly prepaid and new loans at higher rates are made. Moreover, the interest Home City would pay on its deposits would increase rapidly because Home City's deposits generally have shorter periods to repricing. In addition, increases in interest rates can also result in the flow of funds away from savings institutions into direct investments or other investment vehicles, such as mutual funds, which may pay higher rates of return than savings institutions.

As with any method of measuring interest rate risk, certain shortcomings are inherent in the NPV approach. For example, although certain assets and liabilities may have similar maturities or periods of repricing, they may react in different degrees to changes in market interest rates. Also, the interest rates on certain types of assets and liabilities may fluctuate in advance of changes in market interest rates, while interest rates on other types may lag behind changes in market rates. Further, in the event of a change in interest rates, expected rates of prepayment on loans and mortgage-backed securities and early withdrawal levels from certificates of deposit would likely deviate significantly from those assumed in making the risk calculations. For further discussion of the NPV methodology, the risks to Home City and the steps Home City is taking to reduce such risks, see "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF HOME CITY - Asset
and Liability Management."

-9-

If interest rates continue to rise from the recent levels, Home City's net interest income will be negatively affected. Moreover, rising interest rates may negatively affect Home City's earnings due to diminished loan demand. A negative effect on interest income and earnings will adversely affect the value of an investment in the Common Shares.

RISK ASSOCIATED WITH LOANS SECURED BY NONRESIDENTIAL REAL ESTATE

Over the last three years, up to 17% of Home City's loan portfolio has been comprised of loans secured by nonresidential real estate. The security for nonresidential real estate loans currently in Home City's portfolio includes retail stores, office buildings and business premises. At June 30, 1996, Home City had a total of $7.3 million invested in nonresidential real estate loans, which comprised 14.9% of Home City's total loans at such date. Of such amount, $197,000 was delinquent and classified as substandard. See "THE BUSINESS OF HOME CITY - Lending Activities -- Delinquent Loans, Nonperforming Assets and Classified Assets."

Nonresidential real estate lending is generally considered to involve a higher degree of risk than residential lending due to the relatively larger loan amounts and the effects of general economic conditions on the successful operation of income-producing properties. If the cash flow on the property is reduced, for example, as leases are not obtained or renewed, the borrower's ability to repay may be impaired. Home City has endeavored to reduce such risk by evaluating the credit history and past performance of the borrower, the location of the real estate, the quality of the management constructing and operating the property, the debt service ratio, the quality and characteristics of the income stream generated by the property and appraisals supporting the property's valuation. Although management considers its allowance for loan losses to be sufficient to cover anticipated losses on classified assets, the amount of any actual loss could adversely affect Home City's net income and regulatory capital.

LIMITED MARKET FOR THE COMMON SHARES

There is presently no market for the Common Shares. The aggregate offering price for the Common Shares is based upon an independent appraisal of Home City. The appraisal is not a recommendation as to the advisability of purchasing Common Shares. See "THE CONVERSION - Pricing and Number of Common Shares to be Sold." No assurance can be given that persons purchasing Common Shares will thereafter be able to sell such shares at a price at or above the offering price.

HCFC has received approval to have the Common Shares quoted on The Nasdaq Small Cap Market under the symbol "_______" upon the closing of the Conversion, subject to certain conditions which HCFC and Home City believe will be satisfied, although no assurance can be provided that the conditions will be met. In connection with such approval, Webb has informed Home City that Keefe, Bruyette & Woods, Inc., intends to make a market in the Common Shares. No assurance can be given, however, that an active or liquid market for the Common Shares will develop after the completion of the Conversion or, if such a market does develop, that it will continue. Investors should consider, therefore, the potentially illiquid and long-term nature of an investment in the Common Shares.

COMPETITION IN MARKET AREA

Home City faces strong direct competition in its market area for deposits and loans from commercial banks, other savings associations, credit unions and mortgage banking companies. Mortgage banking companies and other non-FDIC insured providers of financial services are not subject to the same degree of regulatory oversight as savings associations and thus have greater operational flexibility, without the costs and burdens associated with compliance with OTS and FDIC regulations.

POSSIBLE INADEQUACY OF THE ALLOWANCE FOR LOAN LOSSES

Home City maintains an allowance for loan losses based upon a number of relevant factors, including, but not limited to, trends in the level of nonperforming assets and classified loans, current and anticipated economic conditions in the lending area, past loss experience, possible losses arising from specific problem assets and changes in the composition of the loan portfolio. While the Board of Directors believes that it uses the best information available to determine the amount of the allowance for loan losses, unforeseen market conditions could result in material adjustments, and net income could be significantly adversely affected, if circumstances differ substantially from the assumptions used in making the determination of the allowance for loan losses.

-10-

LEGISLATION AND REGULATION WHICH MAY ADVERSELY AFFECT HOME CITY'S EARNINGS

Home City is subject to extensive regulation by the OTS and the FDIC and is periodically examined by such regulatory agencies to test compliance with various regulatory requirements. As a savings and loan holding company, HCFC will also be subject to regulation and examination by the OTS. Such supervision and regulation of Home City and HCFC are intended primarily for the protection of depositors and not for the maximization of shareholder value and may affect the ability of HCFC to engage in various business activities. The assessments, filing fees and other costs associated with reports, examinations and other regulatory matters are significant and may have an adverse effect on HCFC's net earnings. See "REGULATION."

The FDIC is authorized to establish separate annual assessment rates for deposit insurance for members of the Bank Insurance Fund (the "BIF") and the SAIF. The FDIC may increase assessment rates for either fund if necessary to restore the fund's ratio of reserves to insured deposits to the target level within a reasonable time and may decrease such rates if such target level has been met. The FDIC has established a risk-based assessment system for both SAIF and BIF members. Under such system, assessments may vary depending on the risk the institution poses to its deposit insurance fund. Such risk level is determined by reference to the institution's capital level and the FDIC's level of supervisory concern about the institution.

Legislation to recapitalize the SAIF and to eliminate the significant premium disparity between the SAIF and the BIF became effective September 30, 1996. The recapitalization plan provides for the payment by November 29, 1996, of a special assessment equal to $.657 per $100 of SAIF deposits held at March 31, 1995. The special assessment will increase SAIF reserves to the level required by law. Certain BIF institutions holding SAIF insured deposits will pay a lower special assessment. In addition, the cost of prior thrift failures will be shared by both the SAIF and the BIF, which will increase BIF assessments. After the payment of the special assessment, SAIF assessments for healthy savings associations will be set at a significantly lower level but can never be reduced below the level set for healthy BIF institutions

On the basis of its $40.4 million in deposits at March 31, 1995, Home City will pay, by November 29, 1996, an additional pre-tax assessment of $265,000. Such payment was recorded as an expense and accounted for by Home City as of September 30, 1996. Earnings and capital were, therefore, negatively affected for the quarter ended September 30, 1996, by an after-tax amount of approximately $175,000.

The recapitalization plan also provides for the merger of the SAIF and BIF effective January 1, 1999, assuming all savings associations have become banks. As a result, it is expected that the thrift charter or the separate federal regulation of thrifts will be eliminated. As a result, Home City would be regulated under federal law as a bank and, therefore, would become subject to the more restrictive activity limitations imposed on national banks. See "REGULATION - FDIC Regulations -- Assessments."

CONTROLLING INFLUENCE OF MANAGEMENT AND ANTI-TAKEOVER PROVISIONS WHICH MAY DISCOURAGE SALES OF COMMON SHARES FOR PREMIUM PRICES

The Articles of Incorporation and Code of Regulations of HCFC and the Charter of Home City contain certain provisions that could deter or prohibit non-negotiated changes in the control of HCFC and Home City. Such provisions include a restriction on the acquisition of more than 10% of the outstanding shares of HCFC by any person during the five-year period following the effective date of the Conversion, the ability to issue additional common shares and a supermajority voting requirement for certain transactions. See "DESCRIPTION OF AUTHORIZED SHARES" and "RESTRICTIONS ON ACQUISITION OF HOME CITY AND HCFC AND RELATED ANTI-TAKEOVER PROVISIONS."

The Articles of Incorporation of HCFC provide that for five years after the effective date of the Conversion, no person, except the ESOP, may acquire the beneficial ownership of more than 10% of any class of outstanding equity securities of HCFC. If such a prohibited acquisition occurs, the securities owned by such person in excess of the 10% limit may not be voted on any matter submitted to the shareholders of HCFC. Such provision may not be waived by management. The ability of management or any other person to solicit revocable proxies from shareholders and vote on behalf of such shareholders will not be restricted by such 10% limit.

The Articles of Incorporation of HCFC also provide that if the Board of Directors recommends that shareholders approve certain matters, including mergers, acquisitions of a majority of the shares of HCFC or the transfer of substantially all of the assets of HCFC, the affirmative vote of the holders of only a majority of the voting shares of HCFC is required to approve such matter. If, however, the Board of Directors recommends against the approval of any such matter, the affirmative vote of the holders of at least 75% of the voting shares of HCFC is required to approve such matters. The existence of such 75% provision

-11-

in the Articles of Incorporation of HCFC may make more difficult actions which certain shareholders deem to be in their best interests.

Officers and directors of HCFC are expected to purchase approximately 10.4% of the shares issued in connection with the Conversion at the mid-point of the Valuation Range. In addition, the ESOP intends to purchase approximately 8% of the shares issued in connection with the Conversion. The ESOP trustee must vote shares allocated under the ESOP as directed by the participants to whom the shares are allocated and vote unallocated shares in his sole discretion in the best interest of the participants. The RRP may acquire Common Shares in the open market or acquire authorized but unissued common shares from HCFC following approval of the RRP by the shareholders of HCFC at a meeting of the shareholders in an amount equal to up to 4% of the Common Shares issued in connection with the Conversion. The RRP trustees, who are expected to be two directors of HCFC, will vote shares awarded but not distributed under the RRP in their discretion.

In view of the various provisions of the Articles of Incorporation and the stock benefit plans of HCFC and Home City, as well as an employment agreement which Home City proposes to enter into with its President, the aggregate ownership by the ESOP, the RRP and the directors and officers of HCFC and Home City may have the effect of facilitating the perpetuation of current management and discouraging proxy contests and takeover attempts. Thus, officers and directors, who are anticipated to be allocated or awarded shares under such plans, will have a significant influence over the vote on such a transaction and may be able to defeat such a proposal. The Boards of Directors of HCFC and Home City believe that such provisions will be in the best interests of shareholders by encouraging prospective acquirers to negotiate a proposed acquisition with the directors. Such provisions could, however, adversely affect the market value of the Common Shares or deprive shareholders of the opportunity to sell their shares for premium prices.

Federal and Ohio law also restrict the acquisition of control of HCFC and Home City. Any or all of these provisions may facilitate the perpetuation of current management and discourage proxy contests or takeover attempts not first negotiated with the Board of Directors. See "RESTRICTIONS ON ACQUISITION OF HOME CITY AND HCFC AND RELATED ANTI-TAKEOVER PROVISIONS."

Regulations of the OTS also restrict the ability of any person to acquire the beneficial ownership of more than 10% of any class of voting equity security of Home City or HCFC without the prior written approval of or lack of objection by the OTS. Such restrictions could restrict the use of revocable proxies. See "RESTRICTIONS ON ACQUISITION OF HOME CITY AND HCFC AND RELATED ANTI-TAKEOVER PROVISIONS."

POSSIBLE ADVERSE EFFECTS IF PREFERRED SHARES ARE ISSUED

The HCFC Articles of Incorporation authorize the issuance of one million preferred shares. The Board of Directors is authorized to issue, without shareholder approval, preferred shares and to fix the designations, preferences or other special rights of such shares and the qualifications, limitations and restrictions thereof. If preferred shares are issued, each holder of preferred shares will be entitled to one vote for each preferred share held of record on all matters submitted to a vote of shareholders. The issuance of preferred shares and any conversion rights which may be specified by the Board of Directors for the preferred shares could adversely affect the voting power of holders of the Common Shares. In addition, if the purchase price of the preferred shares is less than the book value of the Common Shares, the book value of the Common Shares could be adversely affected. No preferred shares will be issued in connection with the Conversion, and the Board of Directors has no present intention to issue any of the preferred shares. See "DESCRIPTION OF AUTHORIZED SHARES" and "RESTRICTIONS ON ACQUISITION OF HOME CITY AND HCFC AND RELATED ANTI-TAKEOVER PROVISIONS - Articles of Incorporation of HCFC -- Ability of the Board of Directors to Issue Additional Shares."

RISK OF DELAYED OFFERING

HCFC and Home City expect to complete the Conversion by December 31, 1996. It is possible, however, that adverse market, economic or other factors could delay the completion of the Conversion. If the Community Offering is extended beyond ______________, 1997, each subscriber will be given a notice of such delay and the right to affirm, increase, decrease or rescind his subscription. In such event, any person who does not affirmatively elect to continue his subscription or elects to rescind his subscription will have all of his funds promptly refunded with interest. Any person who elects to decrease his subscription will have the appropriate portion of his funds promptly refunded with interest. If the Community Offering is extended, the cost of the Conversion could increase and the valuation of Home City could change. Extensions of the Community Offering will not extend past ____________, 1997.

-12-

DILUTIVE EFFECT OF INCREASE IN VALUATION RANGE

The number of Common Shares to be sold in the Conversion may be as much as 15% greater than the maximum of the Valuation Range due to changes in market and financial conditions following the commencement of the Offering. An increase in the number of Common Shares sold will decrease net earnings per share and shareholders' equity per share on a pro forma basis.
See "CAPITALIZATION" and "PRO FORMA DATA."

DILUTIVE EFFECT OF PURCHASES BY THE ESOP AND THE RRP AND OF ESTABLISHMENT OF THE STOCK OPTION PLAN

If the ESOP is unable to purchase Common Shares in the Conversion due to an oversubscription by Eligible Account Holders, the ESOP may purchase authorized but unissued shares from HCFC or purchase in the open market a number of shares equal to up to 8% of the Common Shares issued in connection with the Conversion. If the ESOP shares are purchased from authorized but unissued shares, shareholders would experience a dilution of their ownership interests of up to 7.4%. In addition, the RRP may purchase authorized but unissued shares from HCFC or purchase in the open market a number of shares equal to 4% of the Common Shares issued in connection with the Conversion. The purchase of authorized but unissued shares by the RRP would have a dilutive effect on the ownership interests of HCFC's shareholders of up to 3.85%. See "CAPITALIZATION" and "PRO FORMA DATA." The exercise of stock options, assuming implementation of the Stock Option Plan, will also have a dilutive effect on the ownership interests of then-existing shareholders.

NEGATIVE EFFECT ON EARNINGS AND RETURN ON EQUITY OF CONVERSION PROCEEDS AND ESOP AND RRP EXPENSE

Because the investment of the proceeds of the Conversion in loans will not occur immediately upon receipt and because HCFC's total shareholders' equity will increase significantly, the return on equity of HCFC may decrease substantially for some time after the completion of the Conversion. Moreover, net earnings and return on equity may be negatively affected by the purchase of shares by the ESOP and the implementation of the RRP. HCFC will be required to record as compensation expense the fair value of shares as they are committed to be released to participants pursuant to the ESOP. In addition, if the RRP is implemented, the fair value of the shares held by the RRP will be recorded as compensation expense as the shares are earned. See "'PRO FORMA DATA."

HOME CITY FINANCIAL CORPORATION

HCFC was incorporated under Ohio law in August 1996 at the direction of Home City for the purpose of serving as the holding company for Home City. HCFC has not conducted and will not conduct any business other than business related to the Conversion prior to the completion of the Conversion. HCFC has received approval of the OTS to acquire the capital stock to be issued by Home City in the Conversion. Upon the consummation of the Conversion, HCFC will be a unitary savings and loan holding company, the principal assets of which will initially be the capital stock of Home City, a loan to the ESOP for the purchase of Common Shares and the investments made with the proceeds retained by HCFC from the sale of Common Shares. See "USE OF PROCEEDS." As a savings and loan holding company, HCFC will be required to register with, and will be subject to examination and supervision by, the OTS. See "REGULATION - OTS Regulations -- Holding Company Regulation." The types of business activities in which a unitary savings and loan holding company may engage are virtually unrestricted. See, however, "RISK FACTORS - Legislation and Regulation Which May Adversely Affect Home City's Earnings."

The office of HCFC is located at 63 West Main Street, Springfield, Ohio 45502-1309, and its telephone number is (513) 324-5736.

HOME CITY FEDERAL SAVINGS BANK OF SPRINGFIELD

Home City is a federal mutual savings bank which has served the Springfield, Ohio, area since 1925. Originally formed under the name "Home City Savings and Loan Association," Home City changed its name to "Home City Federal Savings Bank" on May 1, 1996. As a federal savings bank chartered under the laws of the United States, Home City is subject to supervision and regulation by the OTS and the FDIC and is a member of the FHLB of Cincinnati. The deposits of Home City are insured up to applicable limits by the FDIC in the SAIF. See "REGULATION."

Home City is principally engaged in the business of making conventional first mortgage loans secured by one- to four-family residential real estate and nonresidential real estate located within Clark County, Ohio, and adjacent counties and investing in U.S. Government agency obligations, interest-bearing deposits in other financial institutions, mortgage-backed securities and municipal securities. Home City also makes loans secured by multifamily real estate (over four units) and construction, consumer and commercial loans. Loan funds are obtained primarily from savings deposits, loan repayments and borrowings from the FHLB of Cincinnati. See "THE BUSINESS OF HOME CITY - Lending Activities; and - Investment Activities."

Interest on loans and mortgage-backed securities is Home City's primary source of income. The principal expense of Home City is interest paid on deposit accounts. Operating results are dependent to a significant degree on the net interest income of Home City, which is the difference between interest earned on loans and mortgage-backed securities and interest paid on deposits. Like most thrift institutions, Home City's interest income and interest expense are significantly affected by general

-13-

economic conditions and by the policies of various regulatory authorities. See "RISK FACTORS" and "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF HOME CITY."

Home City conducts business from its office at 63 West Main Street, Springfield, Ohio 45502-1309. The telephone number of Home City is (513) 324-5736. See "THE BUSINESS OF HOME CITY."

USE OF PROCEEDS

The following table presents the estimated gross and net proceeds from the sale of the Common Shares in connection with the Conversion based on the Valuation Range:

                                                                                  Maximum,
                                Minimum         Mid-point        Maximum         as adjusted
                                -------         ---------        -------         -----------
Gross proceeds                $6,120,000       $7,200,000       $8,280,000       $9,522,000
Less estimated expenses          357,000          372,000          387,000          404,000
                                                                                 ----------
Total net proceeds            $5,763,000       $6,828,000       $7,893,000       $9,118,000
                              ==========       ==========       ==========       ==========

The net proceeds from the sale of the Common Shares may be outside the Valuation Range, depending upon financial and market and regulatory conditions at the time of the completion of the Offering. See "THE CONVERSION - Pricing and Number of Common Shares to be Sold." The expenses are estimated assuming that (a) all of the indicated number of Common Shares are sold in the Subscription Offering; (b) the directors, officers and their Associates purchase 75,000 Common Shares and
(c) the ESOP purchases 8% of the Common Shares sold. Actual expenses may be more or less than estimated. See "THE CONVERSION - Plan of Distribution."

HCFC will retain 50% of the net proceeds from the sale of the Common Shares, or approximately $3,414,000 at the mid-point of the Valuation Range, including the value of a promissory note from the ESOP which HCFC intends to accept in exchange for the issuance of Common Shares to the ESOP. Such proceeds will be used to fund the RRP and will be invested in short-term and intermediate-term government securities. The remainder of the net proceeds received from the sale of the Common Shares, $3,414,000 at the mid-point of the Valuation Range, will be invested by HCFC in the capital stock to be issued by Home City to HCFC as a result of the Conversion. Such investment will increase the regulatory capital of Home City and will permit Home City to expand its lending and investment activities and to enhance customer services.

Home City anticipates that such net proceeds initially will be invested in short-term interest-bearing deposits in other financial institutions. Eventually, however, Home City will attempt to use the net proceeds to originate mortgage, consumer and other loans in Home City's market areas and may also use the proceeds from the Conversion to expand operations through the establishment of a branch office, which would include space for administrative operations. Home City estimates that the cost of establishing a new branch would be approximately $1.25 million, including land acquisition and construction costs. Although HCFC and Home City could use the increase in capital which will result from the Conversion to acquire other financial institutions or for HCFC to repurchase its own outstanding shares, HCFC and Home City have no current plans or agreements, written or oral, and are not negotiating, to acquire any other institution and have no current plans for HCFC to repurchase any of its shares.
See "THE BUSINESS OF HOME CITY."

MARKET FOR COMMON SHARES

There is presently no market for the Common Shares. The aggregate offering price for the Common Shares is based upon an independent appraisal of Home City. The appraisal is not a recommendation as to the advisability of purchasing Common Shares. See "THE CONVERSION - Pricing and Number of Common Shares to be Sold." No assurance can be given that persons purchasing Common Shares will thereafter be able to sell such shares at a price at or above the offering price.

HCFC has received approval to have the Common Shares quoted on The Nasdaq Small Cap Market under the symbol "____" upon the closing of the Conversion, subject to certain conditions which HCFC and Home City believe will be satisfied, although no assurance can be provided that the conditions will be met. In connection with such approval, Webb has informed

-14-

Home City that Keefe, Bruyette & Woods, Inc., intends to make a market in the Common Shares. No assurance can be given, however, that an active or liquid market for the Common Shares will develop after the completion of the Conversion or, if such a market does develop, that such market will continue. Investors should consider, therefore, the potentially illiquid and long-term nature of an investment in the Common Shares. See "RISK FACTORS - Limited Market for the Common Shares."

DIVIDEND POLICY

The declaration and payment of dividends by HCFC will be subject to the discretion of the Board of Directors of HCFC and will be based on the earnings and financial condition of HCFC and general economic conditions. In an effort to manage the capital of HCFC, the Board of Directors may determine that the payment of a regular or special cash dividend or both may be prudent. No assurance can be given that any dividend will be declared or that any dividend, if declared, will continue in the future.

Other than earnings on the investment of the proceeds retained by HCFC, the only source of income of HCFC will be dividends periodically declared and paid by the Board of Directors of Home City on the common stock of Home City held by HCFC. The declaration and payment of dividends by Home City to HCFC will be subject to the discretion of the Board of Directors of Home City, to the earnings and financial condition of Home City, to general economic conditions and to federal restrictions on the payment of dividends by thrift institutions. Under regulations of the OTS applicable to converted associations, Home City will not be permitted to pay a cash dividend on its capital stock after the Conversion if its regulatory capital would, as a result of the payment of such dividend, be reduced below the amount required for the Liquidation Account or the applicable regulatory capital requirement prescribed by the OTS. See "THE CONVERSION - Principal Effects of the Conversion -- Liquidation Account" and
"MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF HOME CITY - Liquidity and Capital Resources." Home City may not pay a dividend unless such dividend also complies with a regulation of the OTS limiting capital distributions by savings associations.

Capital distributions, for purposes of such regulation, include, without limitation, payments of cash dividends, repurchases and certain other acquisitions by an association of its shares and payments to stockholders of another association in an acquisition of such other association. The capital distribution regulation adopts a 3-tier classification of associations based upon their capital immediately before and, on a pro forma basis, after giving effect to the capital distribution. A tier 1 association is an association which has capital immediately before and after giving effect to a proposed capital distribution that is equal to or greater than the amount of its fully phased-in capital requirement. A tier 2 association is an association which has capital immediately before and after giving effect to a capital distribution which is equal to or in excess of its minimum capital requirement, but is less than the amount of its fully phased-in capital requirement. A tier 3 association is an association which fails to meet its minimum capital requirement immediately before or after giving effect to a capital distribution.

A tier 1 association may make capital distributions equal to up to the higher of (1) 100% of its net earnings to date during the calendar year in which the distribution is made, plus the amount that would reduce by one-half its "surplus capital ratio" at the beginning of the calendar year or (2) 75% of its net income over the most recent four-quarter period. The "surplus capital ratio" is the percentage by which an association's capital-to-assets ratio exceeds Home City's ratio of fully phased-in capital requirement to assets. A tier 2 association may make capital distributions up to 75% of its net earnings over the most recent four-quarter period, if Home City meets the current risk-based capital standard. A tier 3 association may make capital distributions only with the prior written approval of the Regional Director of the OTS or in accordance with an approved capital plan.

If an association meeting the tier 1 criteria has been notified by the OTS that Home City requires more than normal supervision, such association will be treated as a tier 2 or tier 3 association, unless the OTS determines that such treatment is not necessary to ensure Home City's safe and sound operation. Moreover, the OTS may prohibit any capital distribution otherwise permitted by the regulation if the OTS determines that such distribution would constitute an unsafe or unsound practice. See "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF HOME CITY - Liquidity and
Capital Resources."

At June 30, 1996, Home City met the fully phased-in capital requirement. Other than the earnings on the investment of proceeds retained by HCFC, the only source of income of HCFC will be dividends periodically declared and paid by the Board of Directors of Home City on the common stock of Home City held by HCFC. The payment of dividends by Home City will be subject to various regulatory restrictions. On a pro forma basis, as of June 30, 1996, assuming (i) receipt by Home City of $3.4 million of net conversion proceeds, (ii) the investment of such net proceeds in assets having a risk weighting of 20% and
(iii) the

-15-

establishment of a Liquidation Account in the amount of $5.4 million (the regulatory capital of Home City at June 30, 1996), Home City would have $4.19 million available for the payment of dividends to HCFC. See "REGULATORY CAPITAL COMPLIANCE."

CAPITALIZATION

Set forth below is the capitalization of Home City as of June 30, 1996, and the consolidated pro forma capitalization of HCFC, as adjusted to give effect to the sale of Common Shares based on the Valuation Range and estimated expenses. A change in the number of Common Shares sold in the Conversion would materially affect such pro forma capitalization. See "USE OF PROCEEDS" and "THE CONVERSION - Pricing and Number of Common Shares to be Sold."

                                                                Pro forma capitalization of HCFC at June 30, 1996,
                                                                             assuming the sale of:
                                                      ------------------------------------------------------------------
                                                         612,000          720,000           828,000          952,200
                                       Home City's        Common           Common           Common            Common
                                        historical        Shares           Shares           Shares            Shares
                                      capitalization    (offering        (offering         (offering        (offering
                                            at           price of         price of         price of          price of
                                      June 30, 1996   $10 per share)   $10 per share)   $10 per share)    $10 per share)
                                      -------------   --------------   --------------   --------------    --------------
                                                                     (In thousands)
Deposits (1)                               $47,174       $ 47,174        $ 47,174        $ 47,174        $ 47,174
Borrowings                                   2,903          2,903           2,903           2,903           2,903
Preferred shares, no par value:
authorized - 1,000,000 shares;                --             --              --              --              --
assumed outstanding - none
Common Shares, no par value:
authorized - 5,000,000 shares;                --             --              --              --              --
assumed outstanding - as shown(2)
Additional paid-in capital                    --            5,763           6,828           7,893           9,118
Unrealized gain on securities                  127            127             127             127             127
Less Common Shares acquired by the
ESOP (3)                                      --             (490)           (576)           (662)           (762)
Less Common Shares acquired by the
RRP (4)                                       --             (245)           (288)           (331)           (381)
Retained earnings (5)                      $ 5,271       $  5,271        $  5,271        $  5,271        $  5,271
Total capital and  retained earnings       $ 5,398       $ 10,426        $ 11,362        $ 12,298        $ 13,373


(1) Withdrawals from deposit accounts for the purchase of Common Shares have not been reflected in these adjustments. Any deposit withdrawals will reduce pro forma deposits by the amount of such withdrawals.

(2) The number of Common Shares to be issued will be determined on the basis of the final valuation of Home City. See "THE CONVERSION - Pricing and Number of Common Shares to be Sold." Common Shares assumed to be outstanding does not reflect the issuance of any Common Shares reserved for issuance under the Stock Option Plan. See "MANAGEMENT OF HOME CITY - Stock Option Plan."

(3) Assumes that 8% of the Common Shares sold in connection with the Conversion will be acquired by the ESOP trust, a separate entity, and that the funds used to acquire such shares will be borrowed by the ESOP trust from HCFC, with repayment thereof secured solely by the Common Shares purchased by the ESOP trust. Home City has agreed, however, to use its best efforts to fund the ESOP based on future earnings, which best efforts funding will reduce the total capital and retained earnings, as reflected in the table. See "MANAGEMENT OF HOME CITY -Employee Stock Ownership Plan."

(4) Assumes the establishment of the RRP and its acquisition of Common Shares equal to 4% of the shares sold in the Conversion. The pro forma table assumes the Common Shares for the RRP will be purchased in the open market at a price of $10 per share. The Board of Directors may elect, however, to issue the RRP shares from authorized but unissued shares. In the event the RRP shares are obtained from authorized but unissued shares or in the event the RRP is not ratified by the shareholders of HCFC, pro forma shareholders' equity would increase by $245,000, $288,000, $331,000 and $381,000 at the minimum, mid-point, maximum and 15% above the maximum of the Valuation Range, respectively. The issuance of shares to the RRP would have the effect of diluting the percentage interest of existing shareholders by 3.85%.

(5) Retained earnings are substantially restricted. See "THE CONVERSION - Principal Effects of the Conversion -- Liquidation Account" for information concerning the Liquidation Account to be established in connection with the Conversion and "TAXATION - Federal Taxation" for information concerning restricted retained earnings for federal tax purposes.

-16-

PRO FORMA DATA

Set forth below are the pro forma consolidated net earnings of HCFC for the year ended June 30, 1996, and the pro forma shareholders' equity of HCFC at such date, along with the related pro forma per share amounts, giving effect to the sale of the Common Shares in connection with the Conversion. The computations are based on the assumed issuance of 612,000 Common Shares (minimum of the Valuation Range), 720,000 Common Shares (mid-point of the Valuation Range), 828,000 Common Shares (maximum of the Valuation Range) and 952,200 Common Shares (15% above the maximum of the Valuation Range). See "THE CONVERSION - Pricing and Number of Common Shares to be Sold." The pro forma data is based on the following assumptions: (i) the sale of the Common Shares occurred at the beginning of the periods and yielded the net proceeds indicated;
(ii) such net proceeds were invested by HCFC and Home City at the beginning of the specified periods at 5.78%; (iii) no withdrawals from existing deposit accounts were made to purchase the Common Shares; (iv) HCFC will accept a promissory note from the ESOP in exchange for the issuance of Common Shares; and
(v) the cash proceeds retained by HCFC will be used to fund the RRP and, pending such investment, will be invested in short-term and intermediate-term government securities. The assumed return is based upon the market rate for FHLB 90-day deposits because management intends to invest the initial cash proceeds in short-term interest-bearing deposits with the FHLB. In calculating pro forma net earnings, a statutory federal income tax rate of 34% has been assumed for the period, resulting in an after-tax yield of 3.81%. In the opinion of management, the assumed after-tax yield does not differ materially from the estimated after-tax yield which will be obtained on the initial investment of the cash proceeds in short-term, interest-bearing deposits and is viewed as being more relevant in the current low interest rate environment than the use of an arithmetic average of the fiscal year 1996 weighted average yield on interest-earning assets and weighted average rates paid on deposits during such period. Management also believes that utilization of savings withdrawals to fund stock purchases would not have a material impact on the pro forma data presented.

NO ASSURANCE CAN BE PROVIDED THAT THE YIELDS OR RESULTS SET FORTH IN THE PRO FORMA DATA WILL BE ACHIEVED ON INVESTMENT OF THE CONVERSION PROCEEDS. MOREOVER, THE PRO FORMA NET EARNINGS AMOUNTS DERIVED FROM THE ASSUMPTIONS SET FORTH HEREIN SHOULD NOT BE CONSIDERED INDICATIVE OF THE ACTUAL RESULTS OF OPERATIONS OF HCFC THAT WOULD HAVE BEEN ATTAINED FOR ANY PERIOD IF THE CONVERSION HAD BEEN ACTUALLY CONSUMMATED AT THE BEGINNING OF SUCH PERIOD. FURTHER, THE RATIO OF SHARE OFFERING PRICE TO THE PRO FORMA BOOK VALUE IS NOT REPRESENTATIVE OF ANY POTENTIAL PRICE APPRECIATION ON THE COMMON SHARES. NO EFFECT HAS BEEN GIVEN IN THE PRO FORMA SHAREHOLDERS' EQUITY FOR ANY ASSUMED EARNINGS ON THE NET PROCEEDS OF THE CONVERSION.

-17-

                                                                At or for the year ended June 30, 1996
                                                    -------------------------------------------------------------------------------
                                                        612,000              720,000              828,000             952,200
                                                     Common Shares        Common Shares        Common Shares       Common Shares
                                                   (offering price of   (offering price of  (offering price of  (offering price of
                                                     $10 per share)       $10 per share)       $10 per share)    $10 per share) (1)
                                                     --------------       --------------       --------------    ------------------
                                                                   (Dollars in thousands, except per share amounts)
Gross proceeds                                         $  6,120             $  7,200             $  8,280             $  9,522
Less offering expenses and commissions                     (357)                (372)                (387)                (404)
                                                       --------             --------             --------             --------
  Estimated conversion proceeds                           5,763                6,828                7,893                9,118
  Less common shares acquired by ESOP                      (490)                (576)                (662)                (762)
  Less common shares acquired by RRP                       (245)                (288)                (331)                (381)
                                                       --------             --------             --------             --------
  Net cash proceeds                                    $  5,029             $  5,964             $  6,899             $  7,975
                                                       ========             ========             ========             ========

Consolidated net income:
  Historical net income                                $    514             $    514             $    514             $    514
  Pro forma income on net proceeds(2)                       192                  227                  263                  304
  Pro forma ESOP adjustment(3)                              (46)                 (54)                 (62)                 (72)
  Pro forma RRP adjustment(4)                               (32)                 (38)                 (44)                 (50)
                                                       --------             --------             --------             --------
    Pro forma net income                               $    628             $    649             $    671             $    696
                                                       ========             ========             ========             ========

Per share net income:(5)
  Historical net income(6)                             $    .84             $    .71             $    .62             $    .54
  Pro forma income on net proceeds(2)                       .32                  .32                  .32                  .32
  Pro forma ESOP adjustment(3)                             (.08)                (.08)                (.08)                (.08)
  Pro  forma RRP adjustment(4)                             (.05)                (.05)                (.05)                (.05)
                                                       --------             --------             --------             --------

    Pro forma net income per share                     $   1.03             $   0.90             $   0.81             $   0.73
                                                       ========             ========             ========             ========

Offering price to pro forma net income per share
  ("P/E Ratio")                                           9.71X               11.11X               12.35X               13.70X

Shareholders' equity:(7)
  Historical                                           $  5,398             $  5,398             $  5,398             $  5,398
  Estimated conversion proceeds                           5,763                6,828                7,893                9,118
  Less Common Shares acquired by:
    ESOP(3)                                                (490)                (576)                (662)                (762)
    RRP(4)                                                 (245)                (288)                (331)                (381)
                                                       --------             --------             --------             --------
  Pro forma shareholders' equity                       $ 10,426             $ 11,362             $ 12,298             $ 13,373
                                                       ========             ========             ========             ========

Shareholders' equity per share:
  Historical(6)                                        $   8.82             $   7.49             $   6.51             $   5.66
  Estimated conversion proceeds                            9.42                 9.48                 9.53                 9.58
  Less Common Shares acquired by:
    ESOP(8)                                               (0.80)               (0.80)               (0.80)               (0.80)
    RRP(4)                                                (0.40)               (0.40)               (0.40)               (0.40)
                                                       --------             --------             --------             --------
  Pro forma shareholders' equity per share             $  17.04             $  15.77             $  14.84             $  14.04
                                                       ========             ========             ========             ========

Offering price as a percentage of pro forma
  shareholders' equity per share                          58.70%               63.37%               67.33%               71.20%
                                                       ========             ========             ========             ========


(1) Reflects an increase in the number of shares which could occur due to an increase in the Valuation Range of up to 15% to reflect changes in market and financial conditions following the commencement of the Subscription and Community Offerings.

(2) Pro forma net income is calculated using pro forma income earned on net cash proceeds, as discussed above.

(3) It is assumed that 8% of the Common Shares sold in connection with the Conversion will be acquired by the ESOP trust from HCFC, with repayment thereof secured solely by the Common Shares purchased by the ESOP trust. Home City intends to make contributions to the ESOP in amounts equal to the principal and interest requirement of the debt. Home City's payment of the ESOP debt is based upon equal installments of principal over a seven-year period, plus interest. Interest income earned by HCFC on the ESOP debt offsets the interest paid by Home City on the ESOP loan. Accordingly, only the principal payments on the ESOP debt are recorded as an expense (tax-effected) to HCFC on a consolidated basis. The amount borrowed is reflected as a reduction of shareholders' equity. No reinvestment is assumed on proceeds contributed to fund the ESOP. The ESOP expense has been computed in accordance with the American Institute of Certified Public Accountants' Statement of Position 93-6 ("SOP 93-6"), which requires recognition of expense based upon shares committed to be released as security for the loan. See "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF HOME CITY - Impact of New Accounting Standards." The valuation of shares committed to be released is based upon the average market value of the shares during the year, which for purposes of this calculation was assumed to be equal to the $10 per share offering price. See "MANAGEMENT OF HOME CITY -- Employee Stock Ownership Plan."

(Footnotes continued on next page)

-18-

(4) Assumes the establishment of the RRP, which will require approval by the shareholders of HCFC at a meeting to be held not sooner than six months following the completion of the Conversion, its acquisition of Common Shares equal to 4% of the shares sold in the Conversion and that one-fifth of such Common Shares will be earned by participants in each of the first five years following approval of the RRP. The pro forma table assumes the Common Shares for the RRP will be purchased in the open market at a price of $10 per share. The effect reported on pro forma consolidated net income includes the expense related to the vested RRP shares as well as the reduction in income due to a decline in cash proceeds available for investment. The Board of Directors may elect, however, to issue to the RRP authorized but unissued shares. In the event RRP shares are obtained from authorized but unissued shares, pro forma net income per share would decrease $.05 at each level of the Valuation Range. See "MANAGEMENT OF HOME CITY - Recognition and Retention Plan and Trust." The issuance of shares to the RRP would have the effect of diluting the percentage interest of existing shareholders by 3.85%. In the event the RRP is not approved by the shareholders of HCFC, pro forma net income per share would increase $.05 at each level of the Valuation Range. In the event RRP shares are obtained from authorized but unissued shares or in the event the RRP is not ratified by shareholders, pro forma book value per share would increase by $.40 per share at each level of Valuation Range. No effect has been given to the shares reserved for issuance under the Stock Option Plan.

(5) Per share amounts are based upon the weighted average number of shares outstanding of 612,000, 720,000, 828,000 and 952.200 at the minimum, mid-point, maximum and 15% above the maximum of the Valuation Range, respectively. Per share amounts also reflect the effect of SOP 93-6.

(6) Historical per share amounts have been computed as if the Common Shares expected to be issued in the Conversion had been outstanding during the period or on the dates shown, but without any adjustments of historical net income or historical retained earnings to reflect the investment of the estimated net proceeds of the sale of shares in the Conversion or the additional ESOP or RRP expense. At June 30, 1996, per share amounts are based upon shares outstanding of 612,000, 720,000, 828,000 and 952,200 at the minimum, mid-point, maximum and 15% above the maximum of the Valuation Range, respectively.

(7) The effect of the Liquidation Account is not included in these computations. For additional information concerning the Liquidation Account, see "THE CONVERSION -- Principal Effects of the Conversion -- Liquidation Account." The amounts shown do not reflect the federal income tax consequences of the potential restoration of the bad debt reserves to income for tax purposes, which would be required in the event of liquidation. See "TAXATION -- Federal Taxation."

(8) Not intended to represent or suggest possible future appreciation or depreciation of Common Shares.

SUMMARY CONSOLIDATED STATEMENTS OF INCOME

The following Summary Consolidated Statements of Income set forth information concerning Home City for the periods indicated:

                                                            Year ended June 30
                                                      --------------------------------
                                                       1996         1995          1994
                                                      ------       ------        -----
Interest income:
  Interest on loans                                   $4,094       $3,344       $3,074
  Interest on mortgage-backed securities                 209          274          314

  Interest on investments and deposits                   204          217          154
                                                      ------       ------       ------
                                                       4,507        3,835        3,542
Interest expense:

  Interest on deposits                                 2,370        1,835        1,408
  Interest on borrowing                                  172          107           38
                                                      ------       ------       ------
                                                       2,542        1,942        1,446

Net interest income                                    1,965        1,893        2,096

Provision for loan losses                                 50          109          113
                                                      ------       ------       ------

Interest income after provision for loan losses        1,915        1,784        1,983

Noninterest income                                        58            9           12

Noninterest expense                                    1,216          998          923
                                                      ------       ------       ------

Income before income tax                                 757          795        1,072

Income tax expense                                       243          240          367
                                                      ------       ------       ------

Net income                                            $  514       $  555       $  705
                                                      ======       ======       ======

-19-

MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
OF HOME CITY

Home City is primarily engaged in the business of attracting savings deposits from the general public and investing such funds in permanent mortgage loans secured by one- to four-family residential and nonresidential real estate located primarily within Clark County, Ohio, and adjacent counties and in U. S. Government obligations, interest-bearing deposits in other financial institutions, mortgage-backed securities, municipal securities and other investments permitted by applicable law. Home City also originates loans for the construction of one- to four-family residential real estate, loans secured by multifamily (over four units) real estate and consumer and commercial loans.

ANALYSIS OF FINANCIAL CONDITION

GENERAL. Home City's assets totaled $55.7 million at June 30, 1996, an increase of $7.1 million, or 14.7%, from $48.6 million at June 30, 1995. The principal factor in such growth was an increase in loans receivable, offset by decreases in mortgage-backed securities and cash and cash equivalents.

CASH AND CASH EQUIVALENTS, INVESTMENT SECURITIES, MORTGAGE-BACKED SECURITIES AND FHLB STOCK. Cash and cash equivalents, investment securities, mortgage-backed securities and FHLB stock decreased to $8.5 million at June 30, 1996, from $8.9 million at June 30, 1995. The decrease in cash and cash equivalents and mortgage-backed securities at June 30, 1996, is directly related to the increase in mortgage lending during the past several years. Home City did not sell any mortgage-backed securities during the fiscal year ended June 30, 1996, 1995 or 1994. See "THE BUSINESS OF HOME CITY - Lending Activities." Mortgage-backed securities include Federal Home Loan Mortgage Corporation ("FHLMC") and Government National Mortgage Association ("GNMA") securities. Investment securities are composed of U. S. Government and federal agency securities, municipal securities, FHLB common stock, an $18,000 investment in a joint venture and a $20,000 investment in a service corporation.

At June 30, 1996, all of Home City's investment securities were classified as available-for-sale. During the three months ended December 31, 1995, management reclassified certain investment securities, with total amortized costs of $1.4 million at December 31, 1995, from held-to-maturity to available-for-sale. Such securities had an unrealized gain of approximately $6,000. The increase in the carrying value of the investment securities portfolio reflects, in addition to such reclassification, maturities and purchases of securities, as well as a $49,000 increase in the market value of FHLMC stock held in the portfolio during the year.

LOANS RECEIVABLE. Net loans receivable equaled $45.2 million at June 30, 1996, an increase of $6.2 million, or 16.2%, from $39.0 million at June 30, 1995. Home City originated approximately $15.8 million in loans during the fiscal year ended June 30, 1996. Principal payments during the same period were approximately $8.8 million.

Such growth was primarily attributable to an increase in one- to four-family real estate loans, which increase resulted from high loan demand in Home City's market area. Of the $6.2 million in loan growth, $1.4 million occurred in consumer lending. During the quarter ended December 31, 1995, Home City expanded its loan product line to include consumer loans for other than real estate related purchases. Management plans, however, to continue emphasizing single-family residential lending, which has traditionally been Home City's strength.

DEPOSITS. Loan growth during the fiscal year ended June 30, 1996, was primarily funded by an increase of $6.2 million, or 15.2%, in savings deposits, from $40.9 million at June 30, 1995, to $47.2 million at June 30, 1996. As the interest rate environment changed during 1995 and 1996, impacting the rates paid on Home City's deposits, customers moved their deposits from passbook accounts into certificate accounts. As a result, total passbook accounts decreased $939,000, or 8.9%, from $10.5 million at June 30, 1995, to $9.6 million at June 30, 1996. Customers also began to take advantage of new deposit product offerings, namely NOW accounts and interest-bearing checking accounts. Deposit balances in the 1-3 year and 3-5 year certificate categories increased $500,000 and $1.8 million, respectively, at June 30, 1996, compared to June 30, 1995, and at June 30, 1995, compared to June 30, 1994. Short-term certificate accounts also increased $5.3 million at June 30, 1996, compared to June 30, 1995. The change in the deposit mix did not significantly affect Home City's interest rate risk at June 30, 1996. See "Asset and Liability Management."

-20-

Total equity increased $513,000, from $4.9 million at June 30, 1995, to $5.4 million at June 30, 1996. Such increase resulted from net income of $514,000 and a $1,000 decrease in unrealized gains (net of deferred taxes) in fiscal 1996.

COMPARISON OF RESULTS OF OPERATIONS

GENERAL. Home City's net income is primarily dependent upon net interest income, which is a function of the difference, or spread, between the average yield earned on loans and other investments and the average rate paid on deposits and advances, as well as the related amounts of such assets and liabilities. The interest rate spread is affected by economic and competitive factors that influence interest rates, loan demand and deposit flows. Home City, like other financial institutions, is subject to interest rate risk to the degree that its interest-bearing liabilities mature or reprice at different times, or on a different basis, than its interest-earning assets. See "RISK FACTORS - Interest Rate Risk" and "Asset and Liability Management." Home City had net income of $514,000 for the fiscal year ended June 30, 1996, compared to $555,000 in fiscal 1995 and $705,000 in fiscal 1994. The decrease in net income from June 30, 1995 to June 30, 1996, was primarily attributable to an increase in other expenses of $218,000, offset by an increase of $72,000 in net interest income and a decrease in provision for loan losses from $109,000 to $50,000.

The decrease in net income during the fiscal year ended June 30, 1995, was primarily attributable to a $203,000 decrease in net interest income and an increase of $75,000 in other expenses, which were partially offset by a reduction of $127,000 in federal income taxes.

NET INTEREST INCOME. Home City's net interest income increased $72,000 for the fiscal year ended June 30, 1996, compared to the fiscal year ended June 30, 1995, and decreased $203,000 for the fiscal year ended June 30, 1995, compared to the same period in 1994. The increase in fiscal 1996 was primarily attributable to the increase in loan volume exceeding the increase in deposit volume, even though the interest rate spread decreased from 3.95% to 3.42%. The decrease in the interest rate spread was due primarily to the increasing interest cost on certificates of deposit and FHLB advances. The increases in deposits and FHLB advances, combined with the increases in deposit interest rates, resulted in an increase in the average rate paid on deposits from 4.81% at June 30, 1995, to 5.37% at June 30, 1996, and on FHLB advances from 6.57% to 6.66% at such dates. The average yield on interest-earning assets increased slightly, from 8.83% during the fiscal year ended June 30, 1995, to 8.86% in fiscal 1996, due primarily to the increased demand to fund loans, both new and existing, at lower rates and a change in the mix of interest-earning assets.

The decrease in net interest income for the fiscal year ended June 30, 1995, compared to fiscal 1994, was primarily caused by a decrease in the yields on interest-earning assets from 8.92% to 8.83%. The decrease in such yields was due to lower market interest rates, coupled with increasing demand to fund loans. The decrease in asset yields was accompanied by an increase in the cost of deposits from 3.98% to 4.81% and a decrease in the cost of borrowed funds from 8.74% to 6.57%. The decrease in net interest income was partially offset by a decrease in the provision for loan losses of $4,000.

Gross interest income increased $672,000, or 17.5%, for the fiscal year ended June 30, 1996, compared to the fiscal year ended June 30, 1995, due primarily to the average loan balance increasing by $8.6 million, or 24.4%. The average yield on loans was 9.37% and 9.52% in fiscal 1996 and 1995, respectively. Home City's loan portfolio is composed primarily of loans secured by real estate, with either fixed or adjustable interest rates. At June 30, 1996, approximately 48% of the loans outstanding had adjustable interest rates, providing for repricing at one, three or ten years (a fixed rate for ten years followed by one-year adjustment periods) intervals. Home City's interest income on interest-bearing deposits, investment securities, and mortgage-backed securities decreased by $78,000, or 15.9%, for the fiscal year ended June 30, 1996, compared to the same period in 1995. Such decrease resulted from reallocation of investable funds to loan originations, due primarily to increased loan demand.

Gross interest income increased $293,000, or 8.3%, for the fiscal year ended June 30, 1995, compared to the same period in 1994, due primarily to a $4.8 million, or 15.9%, increase in the average outstanding loan balances. Of such increase in interest income, $468,000 was attributable to an increase in loan volume and $288,000 was the result of an increase in interest-bearing deposits, primarily for liquidity purposes. Such increases were offset by a $218,000 decrease in interest income caused by a decrease in the loan portfolio yield to 9.52% from 10.14%, and further offset by decreases of $211,000 and $590,000 in investments and mortgage-backed securities, respectively.

Total interest expense increased $600,000, or 30.9%, for the fiscal year ended June 30, 1996, compared to the fiscal year ended June 30, 1995, and increased $496,000, or 34.3%, for fiscal 1995, compared to fiscal 1994. The increase in fiscal

-21-

1996 was primarily attributable to a $6.9 million increase in average interest-bearing liabilities and an increase in the weighted average interest rate to 5.44% in fiscal 1996 from 4.88% in fiscal 1995. The increase in the weighted average rate can be attributed to an increase in certificate account rates to 6.19% from 5.65% in fiscal 1996, compared to fiscal 1995, as a result of competitive rates offered throughout the year and special rates offered to obtain funds for loans. The $496,000 increase in fiscal 1995, compared to fiscal 1994, was attributable to rising interest rates and rising interest-bearing liability volume. Average deposits increased $2.8 million and advances increased $1.2 million in fiscal 1995, compared to fiscal 1994. The weighted average interest rate on all interest-bearing liabilities also increased in fiscal 1995, to 4.88% from 4.04% in fiscal 1994.

PROVISION FOR LOAN LOSSES. Home City maintains an allowance for loan losses account which, in management's judgment, is adequate to absorb reasonably foreseeable losses inherent in the loan portfolio. See "THE BUSINESS OF HOME CITY - Lending Activities--Allowance for Loan Loses." While management utilizes its best judgment and information available, the ultimate adequacy of the allowance is dependent upon a variety of factors, including the performance of Home City's loan portfolio, the economy, changes in real estate values and interest rates and regulatory requirements regarding asset classifications. The provision for loan losses is determined by management as the amount to be added to the allowance for loan losses, after net charge-offs have been deducted, to bring the allowance to a level which is considered adequate to absorb losses inherent in the loan portfolio in accordance with generally accepted accounting principles ("GAAP"). The amount of the provision is based on management's regular review of the loan portfolio and consideration of such factors as historical loss experience, general prevailing economic conditions, changes in the size and composition of the loan portfolio and considerations relating to specific loans, including the ability of the borrower to repay the loan and the estimated value of the underlying collateral. In addition, various regulatory agencies, as an integral part of their examination process, periodically review Home City's allowance for loan losses. Such agencies may require Home City to provide additions to the allowance based on judgments different from those of management. Although management uses the best information available, future adjustments to the allowance may be necessary due to economic, operating, regulatory, and other conditions that may be beyond Home City's control. There can be no assurance that the amount of past or future provisions for loan losses or the balance of the allowance for loan losses account will be adequate to absorb actual loan losses in the future.

Home City had net charge-offs of $7,000, $19,000 and $82,000 during the fiscal years ended June 30, 1996, 1995 and 1994, respectively. Home City's charge-off history is a product of a variety of factors, including Home City's underwriting guidelines and the composition of it's loan portfolio. Loans secured by real estate make up 96% of Home City's loan portfolio, and loans secured by first mortgages on one- to four-family residential real estate make up 66% of total loans at June 30, 1996. Such loans typically present less risk to a lender than loans which are not secured by real estate. Substantially all of Home City's loans are secured by properties in its primary market area. The provision for loan losses was $50,000, $109,000 and $113,000 for the fiscal years ended June 30, 1996, 1995, and 1994, respectively. The ratio of nonperforming loans to total loans increased to 0.54% in fiscal 1996 from 0.53% in fiscal 1995, following an increase from 0.11% in fiscal 1994. At June 30, 1996, 1995, and 1994, respectively, Home City had a ratio of allowance for loan losses to total loans of 0.80%, 0.82% and 0.74% and a ratio of allowance for loan losses to nonperforming loans of 146.56%, 154.11% and 673.53%. Due to low ratios of nonperforming loans to total loans, low historical charge-offs and low delinquency history, provisions of $109,000 and $113,000 were made in 1995 and 1994. Primarily as a result of the recent addition of consumer installment loan products to Home City's product line and the greater risk to a lender inherent in consumer lending, compared to loans secured by real estate, management determined that a $50,000 provision for loan losses was prudent for the year ended June 30, 1996.

At June 30, 1996, Home City had no real estate owned and acquired through foreclosure.

OTHER INCOME. Other income increased by $49,000, or 544.4%, in fiscal 1996, compared to fiscal 1995 and decreased $3,000, or 25.0%, in fiscal 1995, compared to fiscal 1994. An increase in the cash surrender value of life insurance policies which Home City maintains on four directors to fund a deferred compensation plan for directors' fees accounted for $46,000 of the total increase in fiscal 1996. Service charge income also increased by $7,000 and other miscellaneous income decreased by $4,000 during fiscal 1996. The $3,000 decrease in fiscal 1995 was attributable to a $4,000 decline in miscellaneous income, offset by a $1,000 increase in service charge income.

OTHER EXPENSES. Salaries and employee benefits expenses increased $134,000, or 33.7%, for the year ended June 30, 1996, compared to the year ended June 30, 1995, as a result of the adoption in September 1995 of a deferred compensation plan for directors' fees, staff expansion and normal pay raises of 2% to 3%. Federal deposit insurance premiums increased $13,000, to $96,000, in fiscal 1996, primarily as a result of an increase in Home City's deposit base. State franchise taxes increased by 14.3%, or $9,000, in fiscal 1996, compared to fiscal 1995, as a result of earnings and the

-22-

related equity growth. Fees paid to professionals for legal, tax accounting and general management consulting increased $27,000, or 32.5%, during fiscal 1996. A number of such professional fees were associated with Home City's product and service expansion. Compensation and benefits expenses increased by $87,000, or 28.0%, for the fiscal year ended June 30, 1995, compared to the same period in 1994, as a result of staff expansion, increases in profit sharing bonus payments and normal wage increases. State franchise taxes increased $10,000 in fiscal 1995, compared to fiscal 1994, as a result of earnings and equity growth and occupancy and equipment expenses decreased $16,000, or 13.3%. Management expects that Home City will experience some increase in non-interest expense relating to compliance with securities laws, ESOP and RRP expenses, and other monetary consequences of the Conversion. With the exception of expenses associated with the ESOP and RRP, such expenses cannot be quantified at this time, although management does not expect that such expenses will have a material effect on non-interest expenses. See "PRO FORMA DATA."

INCOME TAX EXPENSE. Effective January 1, 1993, Home City adopted SFAS 109, "Accounting for Income Taxes." The cumulative effect of the change in accounting for income taxes was immaterial to fiscal 1994 and 1993 income tax expense. Federal income tax expense increased $3,000, or 1.3%, in fiscal 1996 compared to fiscal 1995. Federal income tax expense decreased by $127,000, or 34.6%, in fiscal 1995 compared to fiscal 1994, due to a decrease in income before federal income taxes of $277,000, or 25.8%. The effective tax rate of Home City was 32.1% in 1996, 30.2% in 1995 and 34.2% in 1994.

YIELDS EARNED AND RATES PAID. The net interest rate spread decreased from 3.95% for the fiscal year ended June 30, 1995, to 3.42% for the fiscal year ended June 30, 1996. The yield on average interest-earning assets remained almost constant, increasing only 3 basis points, from 8.83% for fiscal 1995 to 8.86% for fiscal 1996, primarily as a result of loans receivable yielding less in fiscal 1996 than in fiscal 1995, even though loan volume increased. The decrease in the interest rate spread was caused by an increase in the cost of funds, primarily due to an increase in certificate account rates from 5.65% in fiscal 1995 to 6.19% in fiscal 1996. The interest rate spread decreased from 4.88% in fiscal 1994 to 3.95% in fiscal 1995. The yield on average interest-earning assets decreased from 8.92% in fiscal 1994 to 8.83% in fiscal 1995, primarily as a result of a decrease in the yield on loans receivable. The average rate paid on deposits increased from 3.98% to 4.81% during the same period, as a result of an increase in certificate account rates. The average rate paid on advances decreased from 8.74% to 6.57% during the same period. The net interest margin for the three-year period ended June 30, 1996, decreased from 5.28% at June 30, 1994, to 3.86%.

-23-

The following table presents certain information relating to Home City's average balance sheet information and reflects the average yield on interest-earning assets and the average cost of customer deposits for the periods indicated. Such yields and costs are derived by dividing annual income or expense by the average monthly balance of interest-earning assets or customer deposits, respectively, for the years presented. Average balances are derived from daily balances, which include nonaccruing loans in the loan portfolio, net of the allowance for loan losses.

                                                                             Year ended June 30,
                                     ----------------------------------------------------------------------------------------------
                                                    1996                            1995                            1994
                                     ------------------------------  ------------------------------  ------------------------------
                                       Average    Interest             Average    Interest             Average    Interest
                                     outstanding   earned/  Yield/   outstanding   earned/  Yield/   outstanding   earned/  Yield/
                                       balance      paid     rate      balance      paid     rate      balance      paid     rate
                                       -------      ----     ----      -------      ----     ----      -------      ----     ----
                                                                            (Dollars in thousands)
Interest-earning assets:
   Interest-bearing deposits          $  1,373    $     61    4.44%   $  1,344    $     72    5.36%   $  1,233    $     51    4.14%
   Investment securities                 2,396         143    5.97       2,996         145    4.84       3,395         103    3.03
   Mortgage-backed securities            3,367         209    6.21       3,947         274    6.94       4,753         314    6.61
   Loans receivable (1)                 43,711       4,094    9.37      35,139       3,344    9.52      30,317       3,074   10.14
                                      --------    --------            --------    --------            --------    --------

     Total interest-earning assets      50,847       4,507    8.86      43,426       3,835    8.83      39,698       3,542    8.92

Non-interest-earning assets:
   Cash and amounts due from
     depository institutions               742                           6,721                             131
   Less:  Allowance for loan losses       (320)                           (283)                           (213)
   Premises and equipment, net             829                             468                             440
   Other nonearning assets                 829                             575                             506
                                      --------                        --------                        --------

     Total assets                     $ 52,577                        $ 44,213                        $ 40,562
                                      ========                        ========                        ========

Interest-bearing liabilities:
   NOW accounts                       $    146    $      2    1.37%   $     --    $     --      --    $     --    $     --      --
   Money market accounts                    48           1    2.08          --          --      --          --          --      --
   Passbook savings accounts             9,748         251    2.57      12,678         395    3.12      18,756         609    3.25
   Certificates of deposit              34,189       2,116    6.19      25,504       1,440    5.65      16,629         799    4.80
                                      --------    --------            --------    --------            --------    --------

     Total deposits                     44,131       2,370    5.37      38,182       1,835    4.81      35,385       1,408    3.98

   FHLB advances                         2,582         172    6.66       1,628         107    6.57         435          38    8.74
                                      --------    --------            --------    --------            --------    --------

     Total interest-bearing
     liabilities                        46,713       2,542    5.44      39,810       1,942    4.88      35,820       1,446    4.04

Non-interest-bearing liabilities           842                             467                             650
                                      --------                        --------                        --------

     Total liabilities                  47,555                          40,277                          36,470

Unrealized gains on securities             109                              32                              --

Retained earnings                        4,913                           4,549                           4,092
                                      --------                        --------                        --------

Total liabilities and retained        $ 52,577                        $ 44,858                        $ 40,562
                                      ========                        ========                        ========
   earnings

Net interest income; net interest
   rate spread                                    $  1,965    3.42%               $  1,893    3.95%               $  2,096    4.88%
                                                  ========  ======                ========  ======                ========  ======

Net interest margin (net interest
   income as a percent of average
   interest-earning assets)                                   3.86%                           4.36%                           5.28%
                                                            ======                          ======                          ======

Average interest-earning assets to
   interest-bearing liabilities                             108.85%                         109.08%                         110.83%
                                                            ======                          ======                          ======


(1) Calculated net of deferred loan fees, loan discounts, loans in process and allowance for loan losses.

-24-

The following table sets forth, for the periods indicated, the weighted average yields earned on Home City's interest-earning assets, the weighted average interest rates paid on interest-bearing liabilities, the interest rate spread and the net interest margin on interest-earning assets. Such yields and costs are derived by dividing income or expense by the average balances of assets or liabilities, respectively, for the periods presented.

                                                                                      Year ended June 30,
                                                                                 -----------------------------
                                                              At June 30, 1996   1996        1995         1994
                                                              ----------------   ----        ----         ----
Weighted average yield on loan portfolio                           9.26%         9.37%       9.52%       10.14%
Weighted average yield on mortgage-backed securities               6.69          6.21        6.94         6.61
Weighted average yield on investment securities                    6.51          5.97        4.84         3.03
Weighted average yield on interest-bearing deposits                3.08          4.44        5.36         4.14
Weighted average yield on all interest-earning assets              8.76          8.86        8.83         8.92
Weighted average interest rate paid on all
   interest-bearing liabilities                                    5.48          5.44        4.88         4.04
Interest rate spread (spread between weighted
   average interest rate on all interest-bearing assets and
   all interest-bearing liabilities)                               3.28          3.42        3.95         4.88
Net interest margin (net interest income as a percentage
   of average interest-earning assets)                             3.80          3.86        4.36         5.28

The table below describes the extent to which changes in interest rates and changes in volume of interest-earning assets and interest-bearing liabilities have affected Home City's interest income and expense during the years indicated. For each category of interest-earning assets and interest-bearing liabilities, information is provided on changes attributable to
(i) changes in volume (change in volume multiplied by prior year rate), (ii) changes in rate (change in rate multiplied by prior year volume) and (iii) total changes in rate and volume. The combined effects of changes in both volume and rate, which cannot be separately identified, have been allocated proportionately to the change due to volume and the change due to rate:

                                                                 Year ended June 30,
                                        ----------------------------------------------------------------------
                                                  1996 vs. 1995                          1995 vs. 1994
                                        -------------------------------        -------------------------------
                                              Increase                               Increase
                                             (decrease)                             (decrease)
                                               due to                                 due to
                                        ------------------                     -----------------
                                        Volume        Rate        Total        Volume        Rate        Total
                                        ------        ----        -----        ------        ----        -----
                                                                     (In thousands)
Interest income attributable to:
   Interest-bearing deposits            $   2        $ (13)       $ (11)       $   5        $  16        $  21
   Investment securities                  (29)          27           (2)         (12)          54           42
   Mortgage-backed securities             (40)         (25)         (65)         (53)          13          (40)
   Loans receivable                       816          (66)         750          488         (218)         270
                                        -----        -----        -----        -----        -----        -----

     Total interest income                749          (77)         672          428         (135)         293
                                        -----        -----        -----        -----        -----        -----

Interest expense attributable to:
   NOW accounts                             2           --            2           --           --           --
   Money market accounts                    1           --            1           --           --           --
   Passbook savings accounts              (91)         (53)        (144)        (197)         (17)        (214)
   Certificates of deposit                491          185          676          426          215          641
   Borrowed funds                          63            2           65          104          (35)          69
                                        -----        -----        -----        -----        -----        -----

     Total interest expense               466          134          600          333          163          496
                                        -----        -----        -----        -----        -----        -----

   Increase (decrease) in net
     interest income                    $ 283        $(211)       $  72        $  95        $(298)       $(203)
                                        =====        =====        =====        =====        =====        =====

-25-

ASSET AND LIABILITY MANAGEMENT

Home City, like other financial institutions, is subject to interest rate risk to the extent that its interest-earning assets reprice differently than its interest-bearing liabilities. As part of its effort to monitor and manage interest rate risk, Home City uses the NPV methodology recently adopted by the OTS as part of its capital regulations. Although Home City is not currently subject to the NPV regulation because such regulation does not apply to institutions with less than $300 million in assets and risk-based capital in excess of 12%, the application of the NPV methodology may illustrate Home City's interest rate risk.

Generally, NPV is the discounted economic value of the difference between incoming cash flows on interest-earning and other assets and outgoing cash flows on interest-bearing and other liabilities. The application of the methodology attempts to quantify interest rate risk as the change in the NPV which would result from a theoretical 200 basis point (1 basis point equals .01%) change in market interest rates. Both a 200 basis point increase in market interest rates and a 200 basis point decrease in market interest rates are considered. If the NPV would decrease more than 2% of the economic value of the institution's assets with either an increase or a decrease in market rates, the institution must deduct 50% of the amount of the decrease in excess of such 2% in the calculation of the institution's risk-based capital. See "Liquidity and Capital Resources."

At June 30, 1996, 2% of the economic value of Home City's assets was approximately $1.2 million. Because the interest rate risk of a 200 basis point increase in market interest rates (which was greater than the interest rate risk of a 200 basis point decrease) was $1.6 million at June 30, 1996, Home City would have been required to deduct approximately $200,000 (half of the approximate $400,000 difference) from its capital in determining whether Home City met its risk-based capital requirement. Regardless of such reduction, however, Home City's risk-based capital at June 30, 1996, would still have exceeded the regulatory requirement by approximately $ 3.0 million.

Presented below, as of June 30, 1996, is an analysis of Home City's interest rate risk as measured by changes in NPV for instantaneous and sustained parallel shifts of 100 basis points in market interest rates. The table also contains the policy limits set by the Board of Directors of Home City as the maximum change in NPV that the Board of Directors deems advisable in the event of various changes in interest rates. Such limits have been established with consideration of the dollar impact of various rate changes and Home City's strong capital position.

As illustrated in the table, Home City's NPV is more sensitive to rising rates than declining rates. Such difference in sensitivity occurs principally because, as rates rise, borrowers do not prepay fixed-rate loans as quickly as they do when interest rates are declining. Because Home City has not originated loans in accordance with traditional secondary market guidelines, the sale of fixed-rate loans may be difficult. As a result, in a rising interest rate environment, the amount of interest Home City would receive on its loans would increase relatively slowly as loans are slowly prepaid and new loans at higher rates are made. Moreover, the interest Home City would pay on its deposits would increase rapidly because Home City's deposits generally have shorter periods to repricing. In addition, increases in interest rates can also result in the flow of funds away from savings institutions into direct investments or other investment vehicles, such as mutual funds, which may pay higher rates of return than savings institutions. Assumptions used in calculating the amounts in this table are OTS assumptions.

                                                        June 30, 1996
                                                  ---------------------------
Change in interest rate      Board limit          $ change           % change
     (basis points)           % change             in NPV             in NPV
     --------------           --------             ------             ------
                             (Dollars in thousands)
          +400                   (50)%            $(3,482)             (52)%
          +300                   (35)              (2,562)             (38)
          +200                   (25)              (1,643)             (25)
          +100                   (10)                (772)             (12)
             0                     0                    0                0
          -100                    10                  573                9
          -200                    25                  918               14
          -300                    35                1,394               21
          -400                    50                1,986               30

-26-

The NPV table indicates that at each 100 basis point increment, the change in Home City's NPV that would have been caused by an increase in interest rates would have exceeded the policy limits set by the Board of Directors. The Board of Directors will consider the June 30, 1996, analysis and will factor such information into its decisions in adjusting the pricing of loans and deposits in the future.

As with any method of measuring interest rate risk, however, certain shortcomings are inherent in the NPV approach. For example, although certain assets and liabilities may have similar maturities or periods of repricing, they may react in different degrees to changes in market interest rates. Also, the interest rates on certain types of assets and liabilities may fluctuate in advance of changes in market interest rates, while interest rates on other types may lag behind changes in market rates. Further, in the event of a change in interest rates, expected rates of prepayment on loans and mortgage-backed securities and early withdrawal levels from certificates of deposit would likely deviate significantly from those assumed in making the risk calculations.

If interest rates continue to rise from the recent levels, Home City's net interest income will be negatively affected. Moreover, rising interest rates may negatively affect Home City's earnings due to diminished loan demand.

LIQUIDITY AND CAPITAL RESOURCES

Home City's liquidity, primarily represented by cash equivalents, is a result of its operating, investing and financing activities. These activities are summarized below for the periods presented.

                                                                     Year Ended June 30,
                                                             ----------------------------------
                                                             1996           1995           1994
                                                             ----           ----           ----
                                                                       (In thousands)
Net income                                                 $   514        $   555        $   705
Adjustments to reconcile net income to net cash from
   operating activities                                         29             43             50
                                                           -------        -------        -------
Net cash provided by  operating activities                     543            598            755
Net cash provided by (used in) investing activities         (7,585)        (7,522)           (97)
Net cash provided by (used in) financing activities          6,508          8,314         (1,908)
                                                           -------        -------        -------
Net change in cash and cash equivalents                       (534)         1,390         (1,250)
Cash and cash equivalents at beginning of period             2,377            987          2,237
                                                           -------        -------        -------
Cash and cash equivalents at end of period                 $ 1,843        $ 2,377        $   987
                                                           =======        =======        =======

Home City's principal sources of funds are deposits, loan and mortgage-backed securities repayments, maturities of securities and other funds provided by operations. Home City also has the ability to borrow from the FHLB of Cincinnati. While scheduled loan repayments and maturing investments are relatively predictable, deposit flows and early loan and mortgage-backed security prepayments are more influenced by interest rates, general economic conditions and competition. Home City maintains investments in liquid assets based upon management's assessment of (i) the need for funds, (ii) expected deposit flows, (iii) the yields available on short-term liquid assets and (iv) the objectives of the asset/liability management program. In the ordinary course of business, part of such liquid investments portfolio is composed of deposits at correspondent banks. Although the amount on deposit at such banks often exceeds the $100,000 limit covered by FDIC insurance, Home City monitors the capital of such institutions to ensure that such deposits do not expose Home City to undue risk of loss.

OTS regulations presently require Home City to maintain an average daily balance of investments in United States Treasury, federal agency obligations and other investments having maturities of five years or less in an amount equal to 5% of the sum of Home City's average daily balance of net withdrawable deposit accounts and borrowings payable in one year or less. The liquidity requirement, which may be changed from time to time by the OTS to reflect changing economic conditions, is intended to provide a source of relatively liquid funds upon which Home City may rely if necessary to fund deposit withdrawals or other short-term funding needs. At June 30, 1996, Home City's regulatory liquidity ratio was 8.45%. At such date, Home City had commitments to originate loans totaling $1.3 million and no commitments to purchase or sell loans. Home City considers its liquidity and capital reserves sufficient to meet its outstanding short and long-term needs. See Note O of the Notes to the Consolidated Financial Statements.

Home City is required by applicable law and regulations to meet certain minimum capital standards. Such capital standards include a tangible capital requirement, a core capital requirement or leverage ratio and a risk-based capital

-27-

requirement. See "REGULATION - OTS Regulations -- Regulatory Capital Requirements." Home City exceeded all of its capital requirements at June 30, 1996, June 30, 1995, and June 30, 1994.

Savings associations are required to maintain "tangible capital" of not less than 1.5% of such association's adjusted total assets. Tangible capital is defined in OTS regulations as core capital and intangible assets.

"Core capital" is comprised of common stockholders' equity (including retained earnings), noncumulative preferred stock and related surplus, minority interests in consolidated subsidiaries, certain nonwithdrawable accounts and pledged deposits of mutual associations. OTS regulations require savings associations to maintain core capital of at least 3% of Home City's total assets. The OTS has proposed to increase such requirement to 4% to 5%, except for those associations with the highest examination rating and acceptable levels of risk. See "REGULATION - OTS Regulations -- Regulatory Capital Requirements."

OTS regulations require that savings associations maintain "risk-based capital" in an amount not less that 8% of risk-weighted assets. Risk-based capital is defined as core capital plus certain additional items of capital, which in the case of Home City includes a general loan loss allowance of $362,000, at June 30, 1996.

The following table summarizes Home City's regulatory capital requirements and actual capital (see Note N of the Notes to Financial Statements for a reconciliation of capital under GAAP and regulatory capital amounts) at June 30, 1996.

                                                                                Excess of actual
                                                                              capital over current
                                  Actual capital      Current requirement         requirement
                                  --------------      -------------------         -----------        Applicable
                               Amount      Percent    Amount       Percent    Amount      Percent    asset total
                               ------      -------    ------       -------    ------      -------    -----------
                                                             (Dollars in thousands)
Tangible Capital              $  5,271      9.48%    $    834       1.5%     $  4,437       7.98%      $55,585
Core Capital                     5,271      9.48        1,688       3.0         3,603       6.48        55,585
Risk-based Capital               5,633     18.77        2,400       8.0         3,233      10.77        29,999

For information concerning regulatory capital on a pro forma basis after the Conversion, see "REGULATORY CAPITAL COMPLIANCE."

At June 30, 1996, Home City had no material commitments for capital expenditures.

SAIF ASSESSMENT

Home City, a SAIF-insured institution, is subject to regulation by the OTS and the FDIC. The FDIC is authorized to establish different annual assessment rates for deposit insurance for members of the BIF and the SAIF. Legislation to recapitalize the SAIF and eliminate the significant premium disparity between the SAIF and the BIF became effective September 30, 1996. The recapitalization plan provides for the payment by November 29, 1996, of a special assessment of $.657 per $100 of SAIF deposits held at March 31, 1995. Based on its $40.4 million in deposits at March 31, 1995, Home City will pay an additional assessment of $265,000. The payment of the assessment was recorded as an expense as of September 30, 1996, reducing capital and earnings for the three months ended September 30, 1996, by an after-tax amount of approximately $175,000.

The recapitalization plan also provides for the merger of the SAIF and BIF effective January 1, 1999, assuming all savings associations have become banks. As a result, it is expected that the thrift charter or the separate regulation of thrifts will be eliminated. As a result, Home City would be regulated under federal law as a bank, and, as a result, would become subject to the more restrictive activity limitations imposed on national banks. See "RISK FACTORS - Legislation and Regulation Which May Adversely Affect Home City's Earnings," and "REGULATION - FDIC Regulations -- Assessments."

IMPACT OF NEW ACCOUNTING STANDARDS

In May 1993, the FASB issued SFAS No. 115, "Accounting for Certain Investments in Debt and Equity Securities," which revised the accounting treatment, classification and carrying value of investment securities. This new accounting standard results in adjusting certain investment securities to market value. Under SFAS No. 115, investment securities are

-28-

classified for balance sheet purposes based on whether such securities are either held in trading accounts, available for sale or strictly to be held to maturity. Under the new standard, trading account securities are marked to market and the corresponding unrealized gains and losses are reflected in income. Investment securities "available for sale" are adjusted to market value with the corresponding unrealized gain or loss shown as an adjustment to shareholders' equity net of deferred income taxes. Investment securities earmarked to be held to maturity are carried at amortized cost. Home City adopted SFAS No. 115 for the fiscal year beginning July 1, 1994. The effect of adoption was to initially increase retained earnings by approximately $91,000 on July 1, 1994, representing the unrealized market value appreciation of Home City's securities net of applicable deferred federal income taxes. As of June 30, 1996, the amount of unrealized gains on securities designated as available for sale had increased to approximately $127,000, which is reflected in Home City's equity accounts.

In November 1995, the FASB issued a "Special Report" on implementation of SFAS No. 115 (the "Special Report"). The Special Report allowed an entity to reclassify securities, including held-to-maturity debt securities, without calling into question the intent of the entity to hold debt securities to maturity in the future. Any transfers from the held-to-maturity category to an available-for-sale classification would result in unrealized gains or losses being recognized as a separate component of equity, net of related tax effects. Pursuant to the provisions of the Special Report, management transferred approximately $1.4 million of securities to an available-for-sale classification.

In May 1993, the FASB issued SFAS No. 114, "Accounting by Creditors for Impairment of a Loan," which further clarifies the accounting treatment, classification and valuation of impaired loans. SFAS No. 114, as amended by SFAS No. 118 in December 1994 as to certain income recognition and financial statement disclosure provisions, will result in applying discounted cash flow analysis and other valuation techniques to impaired or other nonperforming loans as those terms are defined in the Statement. Based upon the composition of Home City's loan portfolio, SFAS No. 114 did not have a material effect on Home City's financial position at the implementation date of October 1, 1995.

In November 1993, the American Institute of Certified Public Accountants issued SOP 93-6, "Employers' Accounting for Employee Stock Ownership Plans." SOP 93-6 addresses the accounting for shares of stock issued to employees by an employee stock ownership plan ("Employee Plan"). SOP 93-6 requires that the employer record compensation expense in an amount equal to the fair value of shares committed to be released to employees from the Employee Plan to employees. SOP 93-6 is effective for fiscal years beginning after December 31, 1993, and relates to shares purchased by an Employee Plan after December 31, 1992. Assuming the Common Shares appreciate in value over time, the adoption of SOP 93-6 will likely increase compensation expense relative to the ESOP, as compared with prior guidance which required the recognition of compensation expense based on the cost of shares acquired by the ESOP. However, the amount of the increase has not been determined as the expense will be based on the fair value of the shares committed to be released to employees, which is not yet determinable.

In December 1994, the Accounting Standards Division of the AICPA approved SOP 94-6, "Disclosure of Certain Significant Risks and Uncertainties." SOP 94-6 requires disclosures in the financial statements beyond those now being required or generally made in the financial statements about the risk and uncertainties existing as of the date of those financial statements in the following areas: nature of operation, use of estimates in the preparation of financial statements, certain significant estimates, and current vulnerability due to certain concentrations. The standard is effective for financial statements issued for fiscal years ending after December 15, 1995. The implementation of SOP 94-6 has not had a significant impact on the financial statements of Home City.

In March 1995, the FASB issued SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of." SFAS No. 121 establishes accounting standards for the impairment of long-lived assets, certain identifiable intangibles and goodwill related to those assets to be held and used and for long-lived assets and certain identifiable intangibles to be disposed of. The standard requires an impairment loss to be recognized when the carrying amount of the asset exceeds the fair value of the asset. The fair value of an asset is the amount at which the asset could be bought or sold in a current transaction between willing parties, that is, other than in a forced liquidation sale. An entity that recognizes an impairment loss shall disclose additional information in the financial statements related to the impaired asset. All long-lived assets and certain identifiable intangibles to be disposed of and for which management has committed to a plan to dispose of the assets, whether by sale or abandonment, shall be reported at the lower of the carrying amount or fair value less cost to sell. Subsequent revisions in estimates of fair value less cost to sell shall be reported as adjustments to the carrying amount of assets to be disposed of, provided that the carrying amount of the asset does not exceed the carrying amount of the asset before an adjustment was made to reflect the decision to dispose of the asset. The statement requires additional disclosure in the footnotes regarding assets to be disposed of. SFAS No. 121 is effective for fiscal years beginning after December 15, 1995. SFAS No. 121 has not had and is not expected to have a material effect on Home City's financial condition or results of operations.

-29-

In May 1995, the FASB issued SFAS No. 122, "Accounting for Mortgage Servicing Rights and Excess Servicing Receivables and for Securitization of Mortgage Loans." SFAS No. 122, which is effective for years beginning after December 15, 1995, will require Home City, to the extent it services mortgage loans for others in return for servicing fees, to recognize these servicing rights as assets, regardless of how such assets were acquired. Additionally, Home City would be required to assess the fair value of these assets at each reporting date to determine any potential impairment. The adoption of SFAS No. 122 has not had and is not expected to have a material effect on financial condition or results of operations.

In October 1995, the FASB issued SFAS No. 123, "Accounting for Stock-Based Compensation," establishing financial accounting and reporting standards for stock-based employee compensation plans. SFAS No. 123 encourages all entities to adopt a new method of accounting to measure compensation cost of all employee stock compensation plans based on the estimated fair value of the award at the date it is granted. Companies are, however, allowed to continue to measure compensation cost for those plans using the intrinsic value based method of accounting, which generally does not result in compensation expense recognition for most plans. Companies that elect to remain with the existing accounting are required to disclose in a footnote to the financial statements pro forma net income and, if presented, earnings per share, as if SFAS No. 123 had been adopted. The accounting requirements of SFAS No. 123 are effective for transactions entered into during fiscal years that begin after December 15, 1995; however, companies are required to disclose information for awards granted in their first fiscal year beginning after December 15, 1994. As Home City is currently a mutual savings and loan association, management of Home City cannot complete an analysis of the potential effects of SFAS No. 123 on its financial condition or results of operations.

In June 1996, the FASB issued SFAS No. 125, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities," which established accounting and reporting standards for transfers and servicing of financial assets and extinguishments of liabilities. The standards are based on a consistent application of a financial components approach that focuses on control. Under that approach, after a transfer of financial assets, an entity recognizes the financial and servicing assets it controls and the liabilities it has incurred, derecognizes financial assets when control has been surrendered, and derecognizes liabilities when extinguished. SFAS No. 125 provides consistent standards for distinguishing transfers of financial assets that are sales from transfers that are secured borrowings. SFAS No. 125 supersedes SFAS No. 122. SFAS No. 125 is effective for transactions occurring after December 31, 1996. Management does not expect an impact from adoption of SFAS No. 125.

IMPACT OF INFLATION AND CHANGING PRICES

The Financial Statements and Notes included herein have been prepared in accordance with GAAP. GAAP requires Home City to measure financial position and operating results in terms of historical dollars, and changes in the relative value of money due to inflation or recession are generally not considered.

In management's opinion, changes in interest rates affect the financial condition of a financial institution to a far greater degree than changes in the inflation rate. While interest rates are greatly influenced by changes in the inflation rate, they do not change at the same rate or in the same magnitude as the inflation rate. Rather, interest rate volatility is based on changes in the expected rate of inflation, as well as on changes in monetary and fiscal policies.

-30-

RECENT DEVELOPMENTS

The following tables set forth selected financial condition data for Home City at September 30, 1996, and June 30, 1996, and selected earnings data for Home City for the three months ended September 30, 1996, and 1995. The results of operations presented below are not necessarily indicative of the results that may be expected for any other period. This information should be read in conjunction with the financial statements and notes thereto included herein.

                                                       September 30,   June 30,
SELECTED FINANCIAL CONDITION AND OTHER DATA:               1996          1996
                                                          ------        -----
                                                         (Dollars in thousands)
Total amount of:
  Assets                                                 $58,380       $55,728
  Cash and cash equivalents (1)                            2,328         2,904
  Investment securities available for sale                 2,189         2,188
  Investment securities held to maturity                    --            --
  Mortgage-backed securities
    available for sale                                     2,873         2,975
  Mortgage-backed securities
    held to maturity                                       --            --
  Loans receivable - net                                  47,761        45,225
  FHLB stock - at cost                                       401           394
  Deposits                                                49,260        47,174
  FHLB advances                                            2,673         2,903
  Retained earnings, substantially
    restricted-net (2)                                     5,262         5,271
  Number of offices, all full service                          1             1

                                                           Three months ended
                                                               September 30,
                                                         -----------------------
SUMMARY OF EARNINGS:                                       1996          1995
                                                         -------        ------
                                                           (Dollars in thousands)
Interest and dividend income                             $ 1,170        $1,041
Interest expense                                             692           602
Net interest income                                          478           439
Provision for loan losses                                   --            --
Net interest income after
     provision for loan losses                               478           439
Noninterest income                                           120            68
Noninterest expense                                          610           323
Income  before income tax                                    (12)          184
Income tax expense (2)                                        (3)           59
Net income (2)                                                (9)          125

(Footnotes on next page)

-31-

                                                       At or for the three months ended
                                                                September 30,
                                                      -----------------------------------
SELECTED FINANCIAL RATIOS:                               1996                     1995
                                                        ------                   -----
Return on assets (3)                                   (0.02)%                    0.25%
Return on equity (4)                                   (0.17)%                    2.56%
Interest rate spread (5)                                3.30%                     3.07%
Net interest margin (6)                                 3.53%                     3.63%
Noninterest expense to average assets (7)               4.32%                     2.62%
Average equity to average assets                        9.60%                     9.93%
Equity to assets at period end                          9.01%                     9.64%
Nonperforming loans to total loans                      0.55%                     0.36%
Nonperforming assets to total assets (8)                0.43%                     0.30%
Allowance for loan losses to total loans                0.80%                     0.76%
Allowance for loan losses to nonperforming
  loans                                               145.74%                   208.84%
Net charge-offs to average loans                        0.01%                     0.02%


(1) Includes cash and amounts due from depository institutions and interest-bearing deposits in other financial institutions.

(2) Effective January 1, 1993, Home City adopted Statement of Financial Accounting Standards ("SFAS") No. 109, "Accounting for Income Taxes". The effect of adopting SFAS No. 109 on income tax expense in 1994 and 1993 was not material.

(3) Net income divided by average total assets.

(4) Net income divided by average total equity.

(5) Average yield on interest-earning assets less average cost of interest-bearing liabilities.

(6) Net interest income as a percentage of average interest-earning assets.

(7) Noninterest expense divided by average total assets.

(8) Nonperforming assets consist of nonaccruing loans, accruing loans 90 days or more past due and real estate acquired (or deemed acquired) in foreclosure proceedings or in lieu thereof. See "THE BUSINESS OF HOME CITY - Delinquent Loans, Nonperforming Assets and Classified Assets."

The following table summarizes the Association's regulatory capital requirements and actual capital at September 30, 1996:

                                                                           Excess of actual capital
                            Actual capital          Current requirement    over current requirement     Applicable
                         --------------------      --------------------    ------------------------      -----------
                         Amount       Percent      Amount       Percent     Amount          Percent     asset total
                         ------       -------      ------       -------     ------          -------     -----------
                                                              (Dollars in thousands)
Tangible capital         $5,208        8.95%       $  872        1.50%      $4,336           7.45%        $58,164
Core capital              5,208        8.95         1,745        3.00        3,463           5.95         $58,164
Risk-based capital        5,572       17.38         2,564        8.00        3,008           9.38         $32,052

-32-

ANALYSIS OF FINANCIAL CONDITION

GENERAL. Home City's assets totaled $58.4 million at September 30, 1996, an increase of $2.6 million, or 4.8%, from $55.7 million at June 30, 1996. Such growth was primarily attributable to an increase in loans receivable which was funded by an increase in deposits.

LOANS RECEIVABLE. Net loans receivable equaled $47.8 million at September 30, 1996, compared to $45.2 million at June 30, 1996, a 5.6% increase attributable to increased mortgage loan demand and the addition of consumer loans to the product line. Management is continuing to emphasize single-family residential lending.

DEPOSITS. Total deposits increased by $2.1 million, to $49.3 million, at September 30, 1996, from $47.2 million at June 30, 1996.

COMPARISON OF RESULTS OF OPERATIONS

GENERAL. Home City recorded a net loss of $9,000 for the three months ended September 30, 1996, compared to income of $125,000 for the same period in 1995. Such loss resulted primarily from the accrual of a $265,000 expense due to the SAIF assessment recognized as of September 30, 1996. If not for such assessment, Home City would have had approximately $165,000 of net income for the three months ended September 30, 1996.

NET INTEREST INCOME. Home City's net interest income for the three months ended September 30, 1996, increased by $39,000, to $478,000, compared to the same period in 1995, due to an increase of $129,000 in interest income, partially offset by an increase in interest expenses of $90,000.

NONINTEREST INCOME AND EXPENSE. Noninterest income was $120,000 for the three months ended September 30, 1996, compared to $68,000 for the same period in 1995. Such increase resulted from fees related to the initiation of new services and increased volume of transactions. The $287,000 increase in noninterest expense for the three months ended September 30, 1996, compared to the same period in 1995, is primarily attributable to the SAIF assessment. It is management's goal to continue to manage controllable costs as much as possible.

YIELDS EARNED AND RATES PAID. Home City's net interest rate spread was 3.30% for the three months ended September 30, 1996, compared to 3.07% for the three months ended September 30, 1995. The average yield on interest earning assets was 8.85% for the three months ended September, 1996, compared to 8.52% for the same period in 1995, while the average cost of interest bearing liabilities was 5.55% for the three months ended September 30, 1996, compared to 5.45% for the same period in 1995.

OTHER SIGNIFICANT RATIOS. The ratio of average equity to average assets decreased 33 basis points at September 30, 1996, compared to September 30, 1995, as a direct result of Home City's asset growth and continued profitability. At September 30, 1996, Home City's ratio of average assets to average equity was 9.60% compared to 9.93% at September 30, 1995.

THE BUSINESS OF HOME CITY

GENERAL

Home City is principally engaged in the business of making permanent first and second mortgage loans secured by one- to four-family residential and nonresidential real estate located in Home City's primary lending area and investing in U.S. Government and agency obligations, interest-bearing deposits in other financial institutions, mortgage-backed securities, and municipal securities. Home City also originates loans for the construction of residential real estate and loans secured by multifamily real estate (over four units), commercial, consumer and nonresidential real estate. The origination of consumer loans, including unsecured loans and loans secured by deposits, constitutes a growing portion of Home City's lending activities. Loan funds are obtained primarily from deposits, which are insured up to applicable limits by the FDIC, and loan and mortgage-backed securities repayments.

-33-

MARKET AREA

Home City conducts business from its main office, located in Springfield, Ohio. Springfield is located 25 miles east of Dayton, 40 miles west of Columbus and 80 miles north of Cincinnati. Home City's primary market area consists of Clark County, Ohio, and adjacent counties. Clark County, Ohio, is characterized by lower than average levels of income and housing values and a slightly higher unemployment level. Its strongest employment categories are wholesale/retail trade, services and manufacturing, with smaller numbers of residents employed in the finance, insurance and real estate industry category.

During the period from 1990 to 1995, Clark County experienced an increase of 0.2% in population, compared to an increase of 2.8% in Ohio and 5.7% in the United States. From 1990 to 1995, Clark County witnessed an increase of 0.3% in the number of households. Such increase was lower than Ohio's increase of 2.7% and the 5.6% increase in households in the United States for the same period.

Median household income figures for Clark County were at lower levels than both Ohio and the United States for 1990 and 1995. In 1990, the median household income for Clark County was $27,868. The median household income levels for Ohio and the United States were $29,276 and $28,255, respectively. From 1990 to 1995, Clark County's median household income increased by 16.0%, to $32,325. During such period, Ohio's median household income level grew 12.9%, to $33,038, and the United States experienced an increase in its median household income level by 19.0%, to $33,610.

The major source of employment by industry group, based on number of employees, for Clark County is the wholesale/retail industry, which accounted for 30.4% of jobs in 1993. In 1993, the services industry was the second major employer in Clark County, at 30.1%, and manufacturing was the third major employer in Clark County, at 27.3%. Construction, finance, insurance and real estate, transportation/utilities, and agriculture/mining combined to account for 12.0% of employment in Clark County in 1993.

An economic indicator that pertains more directly to the banking and thrift industries, because of its direct relationship to lending activity, is the issuance of new housing permits. In 1992, the issuance of new housing permits remained relatively unchanged in Clark County while Ohio and the United States witnessed positive growth rates of 16.3% and 20.1%, respectively. In 1993, Clark County once again remained relatively unchanged, while Ohio and the United States witnessed increases in the number of new housing permits authorized.

Another key economic indicator is the unemployment rate. Clark County experienced a decrease in the unemployment rate from 4.9% to 4.6% in 1995. Ohio experienced a decrease from 5.5% to 4.9% and the unemployment rate in the United States decreased from 6.1% to 5.2% in 1995. In June 1996, unemployment increased to 5.7%, 5.0% and 5.5% in Clark County, Ohio and the United States, respectively.

LENDING ACTIVITIES

GENERAL. Home City's primary lending activity is the origination of conventional mortgage loans and home equity loans secured by one to four-family homes located in Home City's primary lending area and loans secured by nonresidential real estate. Loans for the construction of one- to four-family homes and mortgage loans on multifamily properties containing five units or more are also offered by Home City. Home City does not originate loans insured by the Federal Housing Administration or loans guaranteed by the Veterans Administration. In addition to mortgage lending, Home City makes commercial loans secured by assets of the borrower other than real estate, unsecured loans and consumer loans secured by deposits. Home City does not originate its loans in accordance with traditional secondary market guidelines.

-34-

LOAN PORTFOLIO COMPOSITION. The following table presents certain information with respect to the composition of Home City's loan portfolio at the dates indicated:

                                                                           At June 30,
                                            ---------------------------------------------------------------------------
                                                   1996                       1995                        1994
                                            -------------------      ----------------------    ------------------------
                                                        Percent                    Percent                     Percent
                                                       of total                    of total                    of total
                                            Amount       loans       Amount         loans       Amount          loans
                                            ------     --------      ------        --------     ------         --------
                                                                     (Dollars in thousands)

Residential real estate loans:
   One- to four-family (first mortgage)    $31,580       64.89%      $24,724        58.85%      $19,784         57.63%
   Multifamily                               3,233        6.64         3,288         7.82         2,581          7.52
   Home equity (second mortgage)               313        0.64           232         0.55           121          0.35
Nonresidential real estate loans             7,255       14.91         7,309        17.39         5,197         15.14
Land loans                                   2,223        4.57         1,684         4.01         1,020          2.97
Construction loans                           2,350        4.83         4,582        10.90         5,444         15.86
                                           -------      ------       -------       ------       -------        ------

     Total real estate loans                46,954       96.48         4,819        99.52        34,147         99.47

Commercial loans                                73        0.15            --           --            --            --
Consumer loans:
   Loans on deposits                           160        0.33           201         0.48           183          0.53
   Other consumer loans                      1,481        3.04            --           --            --            --
                                           -------      ------       -------      -------       -------        ------

     Total consumer loans                    1,641        3.37           201         0.48           183          0.53
                                           -------      ------       -------      -------       -------        ------

Total loans                                 48,668      100.00%       42,020       100.00%       34,330        100.00%
                                                        ======                     ======                      ======
   Less:
   Unearned and deferred (income)
     expense, net                             (447)                     (420)                      (324)
   Loans in process                         (2,634)                   (2,321)                    (2,674)
   Allowance for loan losses                  (362)                     (319)                      (229)
                                           -------                   -------                    -------

     Net loans                             $45,225                   $38,960                    $31,103
                                           =======                   =======                    =======

LOAN MATURITY SCHEDULE. The following table sets forth certain information as of June 30, 1996, regarding the dollar amount of loans maturing in Home City's portfolio based on their contractual terms to maturity. Demand loans and loans having no stated schedule of repayments and no stated maturity are reported as due in one year or less.

                              Due during the
                           year ending June 30,        Due 4-5      Due 6-10      Due 11-20    Due more than
                         -----------------------     years after   years after   years after   20 years after
                         1997      1998     1999       6/30/96       6/30/96       6/30/96        6/30/96       Total
                         ----      ----     ----       -------       -------       -------        -------       -----
Mortgage loans:
   Residential          $1,004    $8,092   $8,223        $205         $  721       $ 9,309        $3,549       $31,103
   Nonresidential          283       585      364         129          3,082         6,465         1,814        12,722
Consumer loans             213       101      151         652            344           200            28         1,689
Commercial loans            50        --       10          13             --            --            --            73
                        ------    ------   ------        ----         ------       -------        ------       -------
     Total loans        $1,550    $8,778   $8,748        $999         $4,147       $15,974        $5,391       $45,587
                        ======    ======   ======        ====         ======       =======        ======       =======

Of the loans due more than one year after June 30, 1996, loans with aggregate balances of $22.7 million have fixed rates of interest, and loans with aggregate balances of $21.3 million have adjustable interest rates.

ONE- TO FOUR-FAMILY RESIDENTIAL REAL ESTATE LOANS. The primary lending activity of Home City has been the origination of permanent conventional loans secured by one- to four-family residences, primarily single-family residences, located within Home City's designated lending area. Home City also originates loans for the construction of one- to four-

-35-

family residences and home equity loans. Each of such loans is secured by a mortgage on the underlying real estate and improvements thereon, if any.

OTS regulations limit the amount that Home City may lend in relationship to the appraised value of the real estate and improvements at the time of loan origination. In accordance with such regulations, Home City makes fixed-rate first mortgage loans on one- to four-family, owner occupied residences up to 95% of the value of the real estate and improvements (the "Loan-to-Value Ratio" or "LTV"). Low-to-moderate income loans are granted up to 95% on one- to four-family, owner occupied residences. Home City makes adjustable-rate first mortgage loans for investment purposes on one- to four-family, non-owner occupied residences in amounts up to 75% LTV. Home City generally requires private mortgage insurance ("PMI") for the amount of a loan in excess of 80% of the value of the real estate securing such loan. PMI is required for the amount of any loan in excess of 85% of the value of the real estate and improvements for low-to-moderate income loans. Fixed-rate residential real estate loans are offered by Home City for terms of up to 15 years.

Home City has been originating adjustable-rate mortgage loans ("ARMs") for several years. ARMs are offered by Home City for terms of up to 30 years and with various alternative features. The interest rate adjustment periods on the ARMs are either one year, three years or a fixed rate for 10 years followed by one-year adjustment periods. The interest rate adjustments on ARMs presently originated by Home City are tied to changes in the weekly average yield on the one and three-year U.S. Treasury constant maturities index, respectively. Rate adjustments are computed by adding a stated margin, typically 2.75%, but up to 3.5%, to the index. The maximum allowable adjustment at each adjustment date had been 1% with a maximum adjustment of 3% over the term of the loan, although Home City now offers an ARM with a 2% maximum adjustment at each adjustment date and a maximum adjustment of 6% over the term of the loan. The initial rate is dependent, in part, on how often the rate can be adjusted. Home City originates ARMs which have initial interest rates lower than the sum of the index plus the margin. Such loans are subject to increased risk of delinquency or default due to increasing monthly payments as the interest rates on such loans increase to the fully-indexed level, although such increase is generally lower than industry standards and is considered in Home City's underwriting of any such loans with a one-year adjustment period. See "USE OF PROCEEDS."

The aggregate amount of Home City's one- to four-family residential real estate loans equaled approximately $31.8 million at June 30, 1996, and represented 68% of loans at such date. The largest individual loan balance on a one- to four-family loan at such date was $299,000. At such date, loans secured by one- to four-family residential real estate with outstanding balances of $247,000, or .54% of its one- to four-family residential real estate loan balance, were more than 90 days delinquent or nonaccruing. See "Delinquent Loans, Nonperforming Assets and Classified Assets."

MULTIFAMILY RESIDENTIAL REAL ESTATE LOANS. In addition to loans on one- to four-family properties, Home City makes loans secured by multifamily properties containing over four units. Such loans are made with adjustable interest rates, maximum LTVs of 75% and maximum terms of 15 years.

Multifamily lending is generally considered to involve a higher degree of risk because the loan amounts are larger and the borrower typically depends upon income generated by the property to cover operating expenses and debt service. The profitability of a project can be affected by economic conditions, government policies and other factors beyond the control of the borrower. Home City attempts to reduce the risk associated with multifamily lending by evaluating the creditworthiness of the borrower and the projected income from the project and by obtaining personal guarantees on loans made to corporations and partnerships. Home City currently requires that borrowers agree to submit financial statements, rent rolls and tax returns annually to enable Home City to monitor the loans.

At June 30, 1996, loans secured by multifamily properties totaled approximately $3.2 million, all of which were secured by property located within Home City's primary market area, and all of which were performing in accordance with their terms. The largest loan secured by a multifamily property had a balance at June 30, 1996, of approximately $332,000.

HOME EQUITY LOANS. Home City offers home equity loans secured by second mortgages on one- to four-family residential real estate located in Clark County, Ohio, and adjacent counties. Such loans are made for various purposes, including home improvement, debt consolidation and consumer purchases. The interest rates on loans secured by such second mortgages are fixed, with a maximum combined LTV for the first and second mortgage of 100%.

At June 30, 1996, home equity loans totaled approximately $313,000, 0.64% of Home City's total loan portfolio. All of such loans were secured by property located within Home City's primary market area and all were performing in accordance with their terms. The balance of the largest single home equity loan was $39,200 at June 30, 1996.

-36-

NONRESIDENTIAL REAL ESTATE LOANS. Home City also makes loans secured by nonresidential real estate consisting of retail stores, office buildings and businesses. Such loans generally are originated with adjustable interest rates, terms of up to 15 years, a minimum loan amount of $10,000 and a maximum loan amount of $800,000. Such loans have a maximum LTV of 75%.

Nonresidential real estate lending is generally considered to involve a higher degree of risk than residential lending due to the relatively larger loan amounts and the effects of general economic conditions on the successful operation of income-producing properties. If the cash flow on the property is reduced, for example, as leases are not obtained or renewed, the borrower's ability to repay may be impaired. Home City has endeavored to reduce such risk by evaluating the credit history and past performance of the borrower, the location of the real estate, the quality of the management constructing and operating the property, the debt service ratio, the quality and characteristics of the income stream generated by the property and appraisals supporting the property's valuation. Home City also requires personal guarantees on such loans.

At June 30, 1996, Home City had a total of $7.3 million invested in nonresidential real estate loans, all of which were secured by property located within Home City's primary market area. Such loans comprised approximately 15% of Home City's total loans at such date. At such date, Home City had $197,000 in delinquent nonresidential real estate loans, or 0.43% of total loans. See "Delinquent Loans, Nonperforming Assets and Classified Assets."

Federal regulations limit the amount of nonresidential mortgage loans which a savings bank may make to 400% of its tangible capital. At June 30, 1996, Home City's nonresidential mortgage loans totaled 138% of Home City's tangible capital.

LAND LOANS. Home City makes two varieties of land loans. Loans are made for the acquisition of land to be developed for construction. Such loans are usually made for relatively short periods of time, generally not more than three years, with fixed interest rates. Loans are also made to borrowers who purchase and hold land for various reasons, such as the future construction of a residence. Such loans are generally originated with adjustable interest rates and terms of up to 15 years. Land loans are secured by the land being purchased with the loan proceeds and have maximum LTVs of 75%.

At June 30, 1996, land loans totaled approximately $2.2 million, 4.57% of Home City's total loan portfolio. All of such loans were secured by property located within Home City's primary market area and all were performing in accordance with their terms. The largest land loan at June 30, 1996, had a balance of approximately $421,100.

CONSTRUCTION LOANS. Home City makes loans for the construction of residential and nonresidential real estate. Such loans are structured as permanent loans with fixed rates of interest and for terms of up to 15 years. Most of the construction loans originated by Home City have been made to owner-occupants for the construction of single-family homes by a general contractor.

Construction loans generally involve greater underwriting and default risks than do loans secured by mortgages on existing properties due to the concentration of principal in a limited number of loans and borrowers and the effects of general economic conditions on real estate developments, developers, managers and builders. In addition, such loans are more difficult to evaluate and monitor. Loan funds are advanced upon the security of the project under construction, which is more difficult to value before the completion of construction. Moreover, because of the uncertainties inherent in estimating construction costs, it is relatively difficult to evaluate accurately the LTV and the total loan funds required to complete a project. In the event a default on a construction loan occurs and foreclosure follows, Home City must take control of the project and attempt either to arrange for completion of construction or dispose of the unfinished project. Additional risk exists with respect to loans made to developers who do not have a buyer for the property, as the developer may lack funds to pay the loan if the property is not sold upon completion. Home City attempts to reduce such risks on loans to developers by requiring personal guarantees and reviewing current personal financial statements and tax returns and other projects undertaken by the developers.

At June 30, 1996, a total of $2.3 million, or approximately 4.8% of Home City's total loans, consisted of construction loans. All of Home City's construction loans are secured by property located within Home City's primary market area, and the economy of such lending area had been relatively stable. At June 30, 1996, all of such loans were performing in accordance with their terms.

COMMERCIAL LOANS. Home City occasionally makes loans for commercial purposes. Such loans may be secured by assets of the borrower other than real estate, such as equipment or receivables. At June 30, 1996, Home City had three commercial loans in the aggregate amount of $73,000, each of which was performing in accordance with its terms.

-37-

CONSUMER LOANS. Home City makes various types of consumer loans, including unsecured loans and loans secured by deposits. Such loans are made only at fixed rates of interest for terms of up to 10 years. Home City has been attempting to increase its consumer loan portfolio as part of its interest rate risk management efforts and because a higher rate of interest is received on consumer loans. See "RISK FACTORS" and "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF HOME CITY."

Consumer loans may entail greater credit risk than do residential mortgage loans. The risk of default on consumer loans increases during periods of recession, high unemployment and other adverse economic conditions. Although Home City has not had significant delinquencies on consumer loans, no assurance can be provided that delinquencies will not increase.

At June 30, 1996, Home City had approximately $1.6 million, or 3.4% of its total loans, invested in consumer loans, and none of such loans were more than 90 days delinquent or nonaccruing. See "Delinquent Loans, Nonperforming Assets and Classified Assets."

LOAN SOLICITATION AND PROCESSING. Loan originations are developed from a number of sources, including continuing business with depositors, borrowers and real estate developers, periodic newspaper solicitations by Home City's lending staff and walk-in customers.

Loan applications for permanent mortgage loans are taken by loan personnel. Home City obtains a credit report, verification of employment and other documentation concerning the credit-worthiness of the borrower. Home City limits the ratio of mortgage loan payments to the borrower's income to 25% and the ratio of the borrower's total debt payments to income to 35-42%. An appraisal of the fair market value of the real estate on which Home City will be granted a mortgage to secure the loan is prepared by an independent fee appraiser approved by the Board of Directors.

Unless Home City is aware of factors which may lead to an environmental concern, Home City generally does not require any form of specific environmental study at the time a loan secured by one- to four-family residential real estate is made. If, however, Home City is aware of any such factor at the time of loan origination, Home City requires the completion and satisfactory review of a Phase I Environmental Assessment before such loan is made. For loans secured by multifamily and nonresidential real estate, a Phase I Environmental Assessment is generally required before the loan is made.

Upon the completion of the appraisal and the receipt of information on the borrower, the application for a loan is submitted to various management officials for approval or rejection if the loan amount does not exceed $300,000. If the loan amount exceeds $300,000, or if the application does not conform in all respects with Home City's underwriting guidelines, the application is submitted to the Executive Loan Committee or the Board of Directors for review and for final disposition. If a mortgage loan application is approved, an attorney's opinion of title is obtained on the title to the real estate which will secure the mortgage loan. Borrowers are required to carry satisfactory fire and casualty insurance and flood insurance, if applicable, and to name Home City as an insured mortgagee.

The procedure for approval of construction loans is the same as for permanent mortgage loans, except that an appraiser evaluates the building plans, construction specification and estimates of construction costs. Home City also evaluates the feasibility of the proposed construction project and the experience and record of the builder. Consumer loans are underwritten on the basis of the borrower's credit history and an analysis of the borrower's income and expenses, ability to repay the loan and the value of the collateral, if any. Commercial loans are underwritten on the basis of the source of the cash flow required to service the debt and the value of the security for the loan.

Home City's loans carry no pre-payment penalties, but do provide the entire balance of the loan is due upon sale of the property securing the loan. Home City generally enforces such due-on-sale provisions.

LOAN ORIGINATIONS, PURCHASES AND SALES. Home City originates an almost equal number of fixed and adjustable rate loans. See "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF HOME CITY - Asset and Liability Management." Home City occasionally participates in loans by other institutions. For a discussion of Home City's strategy for loan originations, see "THE BUSINESS OF HOME CITY - General."

-38-

The following table presents Home City's mortgage loan origination, repayment and sales activity for the periods indicated:

                                                           Year ended June 30,
                                                  -------------------------------------
                                                   1996           1995           1994
                                                  -------        -------        -------
                                                             (In thousands)
Loans originated:
   One- to four-family residential (1)            $14,091        $ 9,269        $11,599
   Multifamily residential                            280          1,468            516
   Nonresidential                                   2,210          3,303          2,478
   Commercial                                         133             --             --
   Consumer                                         1,797             37             96
                                                  -------        -------        -------

     Total loans originated                        18,511         14,077         14,689
                                                  -------        -------        -------

Reductions:
   Principal repayments                            (9,287)        (5,623)        11,804)
   Loans sold                                      (2,760)          (338)          (131)
Increase (decrease) in other items, net (2)          (199)          (148)          (186)
                                                  -------        -------        -------

     Net increase                                 $ 6,265        $ 7,968        $ 2,568
                                                  =======        =======        =======


(1) Includes construction loans.

(2) Consists of unearned and deferred fees, costs and the allowance for loan losses.

OTS regulations generally limit the aggregate amount that a savings association may lend to any one borrower to an amount equal to 15% of Home City's total capital under the regulatory capital requirements plus any additional loan reserve not included in total capital. A savings association may lend to one borrower an additional amount not to exceed 10% of total capital plus additional reserves if the additional amount is fully secured by certain forms of "readily marketable collateral." Real estate is not considered "readily marketable collateral." In addition, the regulations require that loans to certain related or affiliated borrowers be aggregated for purposes of such limits. An exception to these limits permits loans to one borrower of up to $500,000 "for any purpose."

Based on such limits, Home City was able to lend approximately $842,000 to one borrower at June 30, 1996. The largest amount Home City had outstanding to one borrower at June 30, 1996, was $653,000. Such loans were secured by several one- to four-family residential loans and a property under construction. All of such loans were current at June 30, 1996.

DELINQUENT LOANS, NONPERFORMING ASSETS AND CLASSIFIED ASSETS. When a borrower fails to make a required payment on a loan, Home City attempts to cause the delinquency to be cured by contacting the borrower. In most cases, delinquencies are cured promptly.

When a loan is fifteen days or more delinquent, the borrower is sent a delinquency notice. When a loan is thirty days delinquent, Home City generally telephones the borrower. Depending upon the circumstances, Home City may also inspect the property and inform the borrower of the availability of credit counseling from Home City and counseling agencies. Before a loan becomes 90 days delinquent, Home City will make further contact with the borrower and, depending upon the circumstances, may arrange appropriate alternative payment arrangements. After a loan becomes 90 days delinquent, Home City may refer the matter to an attorney for foreclosure. A decision as to whether and when to initiate foreclosure proceedings is based on such factors as the amount of the outstanding loan in relation to the original indebtedness, the extent of the delinquency and the borrower's ability and willingness to cooperate in curing delinquencies. If a foreclosure occurs, the real estate is sold at public sale and may be purchased by Home City.

Real estate acquired, or deemed acquired, by Home City as a result of foreclosure proceedings is classified as real estate owned ("REO") until it is sold. When property is so acquired, or deemed to have been acquired, it is initially recorded by Home City at the lower of cost or fair value of the real estate, less estimated costs to sell. Any reduction in fair value is

-39-

reflected in a valuation allowance account established by a charge to income. Costs incurred to carry other real estate are charged to expense.

Home City places a loan on nonaccrual status when the principal and interest is delinquent 90 days or more and deducts from income the interest previously accrued.

The following table reflects the amount of loans in a delinquent status as of the dates indicated:

                                                                       June 30,
                              ---------------------------------------------------------------------------------------------
                                        1996                             1995                            1994
                              ----------------------------    -----------------------------    ----------------------------
                                                  Percent                          Percent                         Percent
                                                  of total                         of total                        of total
                              Number     Amount    loans      Number     Amount      loans     Number    Amount      loans
                              ------     ------   --------    ------     ------    --------    ------    ------    --------
                                                                   (Dollars in thousands)
Loans delinquent for (1):
   30 - 59 days                17         $565      1.24%       11        $296       1.01%       26      $804       2.57%
   60 - 89 days                 4          170      0.37         4          83       0.28         5       152       0.49
   90 days and over            14          247      0.54        14         207       0.71         4        34       0.11
                               --         ----      ----        --        ----       ----        --     -----       ----

   Total delinquent loans      35         $982      2.15%       29        $586       2.00%       35      $990       3.17%
                               ==         ====      ====        ==        ====       ====        ==      ====       ====


(1) The number of days a loan is delinquent is measured from the day the payment was due under the terms of the loan agreement.

The following table sets forth information with respect to the accrual and nonaccrual status of Home City's loans which are 90 days or more past due and other nonperforming assets at the dates indicated:

                                                          At June 30,
                                                -------------------------------
                                                 1996        1995        1994
                                                -------     -------     -------
                                                     (Dollars in thousands)
Loans accounted for on a nonaccrual basis:
   Real estate:
     Residential                                $   247     $   207     $    34
     Nonresidential                                  --          --          --
   Commercial                                        --          --          --
   Consumer                                          --          --          --
                                                -------     -------     -------

     Total nonperforming loans                      247         207          34

Real estate owned                                    --          --          --
                                                -------     -------     -------

     Total nonperforming assets                 $   247     $   207     $    34
                                                =======     =======     =======

     Total loan loss allowance                  $   362     $   319     $   229

     Total nonperforming assets as a
       percentage of total assets                  0.44%       0.43%       0.09%

Loan loss allowance as a percent of
   nonperforming loans                           146.56%     154.11%     673.53%

-40-

During the year ended June 30, 1996, $8,000 in interest income was recognized and an additional $16,000 would have been recorded as interest income on nonaccruing loans had such loans been accruing pursuant to contractual terms. During the periods shown, Home City had no restructured loans within the meaning of SFAS No. 115. There are no loans which are not currently classified as nonaccrual, more than 90 days past due or restructured but which may be so classified in the near future because management has concerns as to ability of the borrowers to comply with repayment terms. For additional information, see Note D of the Notes to Financial Statements.

OTS regulations require that each thrift institution classify its own assets on a regular basis. Problem assets are classified as "substandard," "doubtful" or "loss." "Substandard" assets have one or more defined weaknesses and are characterized by the distinct possibility that the insured institution will sustain some loss if the deficiencies are not corrected. "Doubtful" assets have the same weaknesses as "substandard" assets, with the additional characteristics that (i) the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions and values questionable and
(ii) there is a high possibility of loss. An asset classified "loss" is considered uncollectible and of such little value that its continuance as an asset of the institution is not warranted. The regulations also contain a "special mention" category, consisting of assets which do not currently expose an institution to a sufficient degree of risk to warrant classification but which possess credit deficiencies or potential weaknesses deserving management's close attention.

Generally, Home City classifies as "substandard" all loans that are delinquent more than 90 days, unless management believes the delinquency status is short-term due to unusual circumstances. Loans delinquent fewer than 90 days may also be classified if the loans have the characteristics described above rendering classification appropriate.

The aggregate amount of Home City's classified assets at the dates indicated were as follows:

                                              At June 30,
                                   --------------------------------
                                   1996          1995          1994
                                   ----          ----          ----
                                            (In thousands)
Classified assets:
   Substandard                     $518          $349          $515
   Doubtful                          19            --            --
   Loss                             102           106           106
                                   ----          ----          ----
     Total classified assets       $639          $455          $621
                                   ====          ====          ====

Federal examiners are authorized to classify an association's assets. If an association does not agree with an examiner's classification of an asset, it may appeal this determination to the Regional Director of the OTS. Home City had no disagreements with the examiners regarding the classification of assets at the time of the last examination.

OTS regulations require that Home City establish prudent general allowances for loan losses for any loan classified as substandard or doubtful. If an asset, or portion thereof, is classified as loss, Home City must either establish specific allowances for losses in the amount of 100% of the portion of the asset classified loss, or charge-off such amount.

ALLOWANCE FOR LOAN LOSSES. Home City maintains an allowance for loan losses based upon a number of relevant factors, including but not limited to, trends in the level of nonperforming assets and classified loans, current and anticipated economic conditions in the primary lending area, past loss experience, possible losses arising from specific problem assets and changes in the composition of the loan portfolio.

The single largest component of Home City's loan portfolio consists of one- to four-family residential real estate loans. Substantially all of these loans are secured by residential real estate and require down payments of 20% of the lower of the sales price or appraisal value of the real estate. In addition, such loans are secured by property in Home City's primary lending area. Home City's practice of making loans only in the market area and requiring a 20% down payment have contributed to a low historical charge-off history.

In addition to one- to four-family residential real estate loans, Home City makes additional real estate loans including home equity, multifamily residential real estate, nonresidential real estate and construction loans. These real estate loans are secured by property in Home City's lending area and also require the borrower to provide a down payment. Home City has not experienced any charge-offs from these other real estate loan categories.

-41-

The allowance for loan losses is reviewed quarterly by the Board of Directors. While the Board of Directors believes that it uses the best information available to determine the allowance for loan losses, unforeseen market conditions could result in material adjustments, and net earnings could be significantly adversely affected, if circumstances differ substantially from the assumptions used in marketing the final determination.

The following table sets forth an analysis of Home City's allowance for loan losses for the periods indicated.

                                                           For the year ended June 30,
                                                        ---------------------------------
                                                        1996          1995          1994
                                                        -----         -----         -----
                                                              (Dollars in thousands)
Balance at beginning of period                          $ 319         $ 229         $ 198

Charge-offs                                                (7)          (19)         (107)
Recoveries                                                 --            --            25
Provision for loan losses (charged to operations)          50           109           113
                                                        -----         -----         -----
Balance at end of period                                $ 362         $ 319         $ 229
                                                        =====         =====         =====
Ratio of net charge-offs (recoveries) to average
   net loans outstanding during the period               0.02 %        0.05 %        0.27 %
Ratio of allowance for loan losses to total loans        0.79 %        0.81 %        0.73 %

For the year ended June 30, 1996, $250,000 of the allowance for loan losses was allocated to loans secured by nonresidential real estate and $162,000 was allocated to loans secured by one- to four-family real estate. The allowance was unallocated for the years ended June 30, 1995 and 1994.

MORTGAGE-BACKED SECURITIES

Home City maintains a portfolio of mortgage-backed securities in the form of FHLMC and GNMA participation certificates, as well as two mortgage-backed securities not issued by government agencies. Mortgage-backed securities generally entitle Home City to receive a portion of the cash flows from an identified pool of mortgages. FHLMC and GNMA securities are each guaranteed by their respective agencies as to principal and interest.

The FHLMC is a corporation chartered by the U.S. Government and guarantees the timely payment of interest and the ultimate return of principal on participation certificates. Although FHLMC securities are not backed by the full faith and credit of the U.S. Government, these securities are generally considered among the highest quality investments with minimal credit risk. GNMA is a government agency. GNMA securities are backed by Federal Housing Authority insured and Veterans Administration guaranteed loans. The timely payment of principal and interest on GNMA securities is guaranteed by GNMA and backed by the full faith and credit of the U.S. Government.

The following table sets forth the value of Home City's mortgage-backed securities at the dates indicated.

                                                     At June 30,
                                           -------------------------------
                                            1996               1995
                                           ------     --------------------
                                            Fair       Amortized      Fair
                                           Value         Cost        Value
                                           ------     ---------      -----
                                                    (In thousands)
GNMA certificates                          $2,946       $3,635       $3,567
FHLMC certificates                             29           32           36
                                           ------       ------       ------

    Total mortgage-backed securities       $2,975       $3,667       $3,603
                                           ======       ======       ======

-42-

The following table sets forth information regarding scheduled maturities, amortized costs, market value and weighted average yields of Home City's mortgage-backed securities at June 30, 1996. Expected maturities will differ from contractual maturities due to scheduled repayments and because borrowers may have the right to call or prepay obligations with or without prepayment penalties. The following table does not take into consideration the effects of scheduled repayments or the effects of possible prepayments.

                                                                  At June 30, 1996
                    --------------------------------------------------------------------------------------------------------------
                        One year            After one to       After five to         After ten           Total mortgage-backed
                         or less             five years          ten years             years                   portfolio
                    -----------------     -----------------  ------------------  -------------------  ----------------------------
                    Carrying  Average     Carrying  Average  Carrying   Average  Carrying    Average  Carrying  Market     Average
                      value    yield       value     yield     value     yield    value       yield     value    value      yield
                    --------  -------     --------  -------  --------   -------  --------    -------  --------  ------     -------
                                                                (Dollars in thousands)

GNMA certificates      $--       --%         $--       --%     $904       7.51%  $2,042       7.67%    $2,946   $2,946       7.62%
FHLMC certificates      --       --           --       --        --         --       29      10.35         29       29      10.35
                       ---       --          ---       --      ----       ----   ------      -----     ------   ------      -----
      Total            $--       --%         $--       --%     $904       7.51%  $2,071       7.70%    $2,975   $2,975       7.64%
                       ===       ==          ===       ==      ====       ====   ======      =====     ======   ======      =====

For additional information, see Note C of the Notes to Financial Statements.

-43-

INVESTMENT ACTIVITIES

OTS regulations require that Home City maintain a minimum amount of liquid assets, which may be invested in U. S. Treasury obligations, securities of various federal agencies, certificates of deposit at insured banks, bankers' acceptances and federal funds. Home City is also permitted to make investments in certain commercial paper, corporate debt securities rated in one of the four highest rating categories by one or more nationally recognized statistical rating organizations, and mutual funds, as well as other investments permitted by federal regulations. See "REGULATION" and "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF HOME CITY."

The following table sets forth information concerning Home City's investments at the dates indicated:

                                                                        At June 30,
                            ---------------------------------------------------------------------------------------------------
                                          1996                              1995                            1994
                            --------------------------------  -------------------------------- --------------------------------
                            Carrying  % of    Market   % of   Carrying  % of    Market   % of  Carrying   % of    Market     % of
                             value    Total    value   Total    value   Total    value   Total   value    Total    value     Total
                            -------- ------   ------   -----  --------  -----   ------   ----- --------   -----   -------    -----
                                                                 (Dollars in thousands)
Interest-bearing demand
   deposits in other        $  588    12.70%  $  588   12.72% $  307     6.65% $  307    6.64%  $   77     2.42%  $   77     2.42%
   financial institutions
Federal funds sold             400     8.64      400    8.65   1,500    32.50   1,500   32.45      450    14.12      450    14.15
Time deposits in other
   financial institutions    1,061    22.91    1,053   22.78     360     7.80     360    7.79       --       --       --       --
Investment securities:
   U.S. government and
     federal agency            997    21.53      997   21.57   1,496    32.42   1,496   32.36    2,098    65.83    2,092    65.77
     securities
   Municipal securities (1)    883    19.07      883   19.10     405     8.78     413    8.93       --       --       --       --
   Equity securities           270     5.83      270    5.84     221     4.79     221    4.78      273     8.57      273     8.58
Investment in joint             18     0.39       18    0.39      18     0.39      18    0.39       18     0.56       18     0.57
   venture (2)
Service corporation (3)         20     0.43       20    0.43      20     0.43      20    0.43       23     0.72       23     0.72
FHLB stock                     394     8.51      394    8.52     288     6.24     288    6.23      248     7.78      248     7.80
                            ------   ------   ------  ------  ------   ------  ------  ------   ------   ------   ------   ------
Total investments           $4,631   100.00%  $4,623  100.00% $4,615   100.00% $4,623  100.00%  $3,187   100.00%  $3,181   100.00%
                            ======   ======   ======  ======  ======   ======  ======  ======   ======   ======   ======   ======


(1) Bonds issued by local school districts.

(2) Home City has a 50% ownership interest in a joint venture that is primarily involved in the development of low income housing.

(3) Home City owns 100% of Homciti Service Corp., whose assets consist of common shares of Intrieve, a data service provider, and a 0.875% interest in a joint venture which owns The Springfield Inn, a hotel in Springfield, Ohio.

-44-

The following tables set forth the contractual maturities, carrying values, market values and average yields for Home City's investments at June 30, 1996.

                                                                 At June 30, 1996
                                       --------------------------------------------------------------------
                                        One year or less      After one to five years    After five years
                                       -------------------    -----------------------   -------------------
                                       Carrying    Average     Carrying      Average    Carrying    Average
                                         value      yield        value        yield      value       yield
                                       --------    -------     --------      -------    --------    -------
                                                              (Dollars in thousands)
Interest-bearing demand deposits
   in other financial institutions     $  588       5.10%       $   --         --%       $ --         --%
Federal funds sold                        400       5.07            --         --          --         --
Time deposits in other financial
   institutions                         1,038       5.23            --         --          23        1.25
Investment securities:
   U.S. government and federal
     agency securities                     --         --           997       6.10%         --         --
   Municipal securities                   134       5.04           568       5.36         181        5.36
   Equity securities                       --         --            --         --         270        1.44
Investment in joint venture                --         --            --         --          18         --
Service corporation                        --         --            --         --          20         --
FHLB stock                                 --         --            --         --         394       6.43
                                       ------       ----        ------       ----        ----       ----
Total investments                      $2,160       5.15%       $1,565       5.83%       $906       4.90%
                                       ======       ====        ======       ====        ====       ====

                                                        At June 30, 1996
                                      --------------------------------------------------
                                       Average                                  Weighted
                                        life        Carrying       Market        average
                                      in years        value        value         yield
                                      --------      --------       ------       --------
                                                    (Dollars in thousands)
Certificates of deposit in FHLB           .33        $1,061       $1,053          4.57%
   and other financial institutions
Investment securities:
   U.S. government and federal
      agency securities                  2.11           997          997            --

   FHLB and FHLMC stock                    --           650          650            --

   Municipal securities                  3.52           883          883          5.31
                                                     ------       ------

     Total                                           $3,591       $3,583
                                                     ======       ======

DEPOSITS AND BORROWINGS

GENERAL. Deposits have traditionally been the primary source of Home City's funds for use in lending and other investment activities. In addition to deposits, Home City derives funds from FHLB advances, interest payments and principal repayments on loans and mortgage-backed securities, income on earning assets, service charges and gains on the sale of assets. See "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF HOME CITY." Loan payments are a relatively stable source of funds, while deposit inflows and outflows fluctuate more in response to general interest rates and money market conditions. See "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF HOME CITY - Analysis of Financial
Condition."

DEPOSITS. Deposits are attracted principally from within Home City's primary market area through the offering of a broad selection of deposit instruments, including NOW accounts, money market accounts, passbook savings accounts and term certificate accounts. Home City also offers individual retirement accounts ("IRA"), both in passbook and certificate

-45-

form. Interest rates paid, maturity terms, service fees and withdrawal penalties for the various types of accounts are established periodically by the management of Home City based on Home City's liquidity requirements, growth goals and interest rates paid by competitors. Home City does not use brokers to attract deposits.

At June 30, 1996, Home City's certificates of deposit totaled $37.0 million, or 78% of total deposits. Of such amount, approximately $5.7 million in certificates of deposit mature within one year. Based on past experience and Home City's prevailing pricing strategies, management believes that a substantial percentage of such certificates will renew with Home City at maturity. If there is a significant deviation from historical experience, Home City can utilize borrowings from the FHLB as an alternative to this source of funds.

The following table sets forth the dollar amount of deposits in the various types of savings programs offered by Home City at the dates indicated:

                                                                    At June 30,
                                   -----------------------------------------------------------------------------------
                                            1996                        1995                            1994
                                   -----------------------      ---------------------         ------------------------
                                                  Percent                    Percent                          Percent
                                                  of total                   of total                         of total
                                   Amount         deposits      Amount       deposits          Amount         deposits
                                   ------         --------      ------       --------          ------         --------
                                                                 (Dollars in thousands)
Transaction accounts:
 Demand                            $   302           0.64%      $    --           --%         $    --             --%
 NOW accounts(1)                       395           0.84            --           --               --             --
 Passbook savings accounts(2)        9,561          20.27        10,500        25.65           15,128          43.45
                                   -------         ------       -------       ------          -------         ------

  Total transaction accounts        10,258          21.75        10,500        25.65           15,128          43.45

Certificates of deposit:
   2.01 - 4.00%                         --             --           600         1.47            5,873          16.87
   4.01 - 6.00%                     15,810          33.51        13,287        32.46           10,849          31.16
   6.01 - 8.00%                     21,106          44.74        16,549        40.42            2,966           8.52

  Total certificates of deposit     36,916          78.25        30,436        74.35           19,688          56.55
                                   -------         ------       -------       ------          -------         ------

  Total deposits(3)                $47,174         100.00%      $40,936       100.00%         $34,816         100.00%
                                   =======         ======       =======       ======          =======         ======


(1) Home City's weighted average interest rate paid on NOW accounts fluctuates with the general movement of interest rates. At June 30, 1996, the weighted average rate on NOW accounts was 1.41%.

(2) Home City's weighted average rate on passbook savings accounts fluctuates with the general movement of interest rates. The weighted average interest rate on passbook accounts was 2.52%, 2.97% and 3.41% at June 30, 1996, 1995 and 1994, respectively.

(3) IRAs are included in the various certificates of deposit balances. IRAs totaled $5.5 million, $4.4 million and $2.7 million as of June 30, 1996, 1995 and 1994.

-46-

The following table shows rate and maturity information for Home City's certificates of deposit as of June 30, 1996:

                                                       Amount Due
                            --------------------------------------------------------------
                                             Over         Over
                              Up to       1 year to    2 years to       Over
    Rate                    one year       2 years      3 years       3 years        Total
    ----                    --------      ---------    ----------     -------        -----
                                                    (In thousands)
2.01 -  4.00%               $    --        $    --       $   --          $ --       $    --
4.01 -  6.00                 10,409          2,913        2,304           184        15,810
6.01 -  8.00                  5,000         13,660        1,950           496        21,106
                            -------        -------       ------          ----       -------

Total certificates
     of deposit             $15,409        $16,573       $4,254          $680       $36,916
                            =======        =======       ======          ====       =======

The following table presents the amount of Home City's certificates of deposit of $100,000 or more by the time remaining until maturity as of June 30, 1996:

Maturity                               Amount
--------                               ------
                                   (In thousands)
Three months or less                   $1,244
Over 3 months to 6 months                 782
Over 6 months to 12 months                661
Over 12 months                          4,529
                                      -------
    Total                              $7,216
                                       ======

The following table sets forth Home City's deposit account balance activity for the periods indicated:

                                                       Year ended June 30,
                                             -------------------------------------
                                              1996           1995           1994
                                             -------       --------       --------
                                                    (Dollars in thousands)

Beginning balance                            $40,936       $ 34,816       $ 36,688
Deposits                                      42,110         24,327         15,447
Withdrawals                                  (38,242)       (20,052)       (18,727)
                                             -------       --------       --------
Net increases (decreases) before
   interest credited                           3,868          4,275         (3,280)
Interest credited                              2,370          1,845          1,408
                                             -------       --------       --------
Ending balance                               $47,174       $ 40,936       $ 34,816
                                             =======       ========       ========

  Net increase (decrease)                    $ 6,238       $  6,120       $ (1,872)

  Percent increase (decrease)                  15.24 %        17.58 %        (5.10)%

BORROWINGS. The FHLB System functions as a central reserve bank providing credit for its member institutions and certain other financial institutions. See "REGULATION - Federal Home Loan Banks." As a member in good standing of the FHLB of Cincinnati, Home City is authorized to apply for advances from the FHLB of Cincinnati, provided certain standards of creditworthiness have been met. Under current regulations, an association must meet certain qualifications to be eligible for FHLB advances. The extent to which an association is eligible for such advances will depend upon whether it meets the Qualified Thrift Lender Test (the "QTL Test"). See "REGULATION - OTS Regulations -- Qualified Thrift Lender Test." If an association meets the QTL Test, it will be eligible for 100% of the advances it would otherwise be eligible to receive. If an

-47-

association does not meet the QTL Test, it will be eligible for such advances only to the extent it holds specified QTL Test assets. At June 30, 1996, Home City was in compliance with the QTL Test.

Home City obtained advances from the FHLB of Cincinnati as set forth in the following table:

                                                                    June 30,
                                                        --------------------------------
                                                         1996         1995         1994
                                                        ------       ------        -----
                                                              (Dollars in thousands)
Average balance outstanding                             $2,582       $1,628        $ 435

Maximum amount outstanding at any month
    during the period                                    3,564        2,715          457

Balance outstanding at end of period                     2,903        2,618          424

Weighted average interest rate during the period         6.66%         6.57%        8.74%

Weighted average interest rate at end of period          6.49%         6.69%        5.91%

COMPETITION

Home City competes for deposits with other savings associations, commercial banks and credit unions and with the issuers of commercial paper and other securities, such as shares in money market mutual funds. The primary factors in competing for deposits are interest rates and convenience of office location. In making loans, Home City competes with other savings associations, commercial banks, consumer finance companies, credit unions, leasing companies, mortgage companies and other lenders. Home City competes for loan originations primarily through the interest rates and loan fees offered and through the efficiency and quality of services provided. Competition is affected by, among other things, the general availability of lendable funds, general and local economic conditions, current interest rate levels and other factors which are not readily predictable. Three savings associations, seven banks and seven credit unions have offices in Clark County. At June 30, 1995, Home City had approximately 3.22% of all financial institution deposits in Clark County.

The size of financial institutions competing with Home City is likely to increase as a result of changes in statutes and regulations eliminating various restrictions on interstate and inter-industry branching and acquisitions. Such increased competition may have an adverse effect upon Home City.

SUBSIDIARIES

Home City owns all of the outstanding shares of Homciti Service Corporation, an Ohio corporation ("Homciti"). Homciti owns common stock in Intrieve, a data processing company which serves Home City, and an .875% ownership interest in a joint venture which owns the Springfield Inn, a local hotel. At June 30, 1996, the aggregate value of the Intrieve stock and the joint venture investment equaled approximately $38,000.

-48-

PROPERTIES

The following table sets forth certain information at June 30, 1996, regarding the ownership by Home City of the land and improvements at 63 West Main Street, Springfield, Ohio, the office of Home City:

  Year            Square            Net
acquired          footage        book value(1)
--------          -------        ----------
  1975             5,839         $367,000


(1) At June 30, 1996, Home City's office premises and equipment had a total net book value of $488,000. For additional information regarding Home City's office premises and equipment, see Notes A and F of Notes to Financial Statements.

PERSONNEL

As of June 30, 1996, Home City had 11 full-time employees and three part-time employees. Home City believes that relations with its employees are good. Home City offers health and life insurance benefits. None of the employees of Home City are represented by a collective bargaining unit.

LEGAL PROCEEDINGS

Home City is not presently involved in any legal proceedings of a material nature. From time to time, Home City is a party to legal proceedings incidental to its business to enforce its security interest in collateral pledged to secure loans made by Home City.

MANAGEMENT OF HCFC

The Board of Directors of HCFC consists of five members. Each of the directors of Home City is also a director of HCFC. See "MANAGEMENT OF HOME CITY" for information on each of such directors. The term of each of the directors expires in 1997.

The following persons serve as the officers of HCFC:

Name                                           Office
----                                           ------
Douglas L. Ulery                               President
P. Clark Engelmeier                            Chairman of the Board
Jo Ann Holdeman                                Secretary
Gary E. Brown                                  Treasurer

MANAGEMENT OF HOME CITY

DIRECTORS AND EXECUTIVE OFFICERS

The Charter of Home City provides for a Board of Directors consisting of not less than five nor more than 15 directors, such number to be fixed or changed in the Bylaws or by the members. The Board of Directors currently consists of five directors, divided into three classes. One class of directors is elected each year. Each director serves for a three-year term. The Board of Directors met 12 times during the fiscal year ended June 30, 1996, for regular and special meetings. No director attended fewer than 75% of the aggregate of such meetings and all meetings of the committees of which such director was a member.

-49-

The following table presents certain information with respect to the present directors and executive officers of Home City:

Name                           Age(1)           Position with Home City         Director since      Term expires
- ----                           ---              -----------------------         --------------      ------------
John D. Conroy                  46          Director                                1988                1998
P. Clark Engelmeier             65          Director, Chairman of the Board         1977                1997
James Foreman                   56          Director                                1995                1997
Terry A. Hoppes                 47          Director                                1994                1999
Douglas L. Ulery                49          Director, President, CEO                1993                1999
Gary E. Brown                   56          Vice President and Treasurer             N/A                N/A
JoAnn Holdeman                  40          Vice President and Secretary             N/A                N/A


(1) At November 1, 1996.

Since 1971, Mr. Conroy has been the owner and President of Conroy Funeral Home, Inc., in Springfield, Ohio. Mr. Conroy is a licensed funeral director and embalmer. From January 1995 to March 1996, Mr. Conroy was the Secretary of Home City.

Mr. Engelmeier has been a self-employed life insurance agent and securities broker during the past 40 years and is a Chartered Life Underwriter. Mr. Engelmeier retired from the U.S. Army in 1991 as a lieutenant colonel.

Mr. Foreman has been the President, Chief Executive Officer and owner of Jim Foreman Pontiac-Nissan and the President and owner of SKDP Insurance Agency for the past 26 years. Mr. Foreman is a member of the Board of Directors of the Springfield Chamber of Commerce. Mr. Foreman served as Vice President of Home City from 1995 to March 1996.

Mr. Hoppes is a professional engineer and surveyor and has been the owner and the President of Hoppes Engineering and Surveying Company since 1977 and the President of Hoppes Builders and Development Company since 1981. From January 1995 to March 1996, Mr. Hoppes was the Treasurer of Home City.

Mr. Ulery has been the President and the Chief Executive Officer of Home City since 1992 and a director of Home City since 1994. From 1985 until joining Home City, Mr. Ulery was the Vice President of Regional Banking Offices Operation with Society Corporation.

Mr. Brown has been employed at Home City since October 1995, as Assistant Vice President from October 1995 to March 1996 and as Vice President and Treasurer since March 1996. During the five years prior to joining Home City, Mr. Brown was employed as an Assistant Vice President at Huntington Bank.

Ms. Holdeman has been employed at Home City since 1986. Ms. Holdeman served as Assistant Vice President and Assistant Secretary from 1992 to March 1996 and has served as Vice President and Secretary since March 1996.

COMMITTEES OF DIRECTORS

Neither Home City nor HCFC maintains an audit, nominating or compensation committee.

COMPENSATION

Each director of Home City receives a retainer fee of $1,000 per month for service as a director of Home City. In addition, the Chairman of the Board of Directors receives an additional fee of $150 per month. Edgar Witten, a Director Emeritus, receives a fee of $200 per month.

Four of Home City's directors participate in a deferred compensation plan whereby payment of part or all of such their directors' fees is deferred. Home City records the deferred fees as expenses and in a liability account. Interest is periodically credited on each account. Each director is fully vested in his account, and the balance is payable upon termination of directorship prior to death or retirement. Home City has provided for the contingent liability created by the deferred

-50-

compensation plan by purchasing a single-premium universal life insurance policy on each director. Upon retirement or death, a director or his estate will receive the benefits payable pursuant to the policy on his life.

The following table presents certain information regarding the cash compensation received by the President and Chief Executive Officer of Home City. No other executive officer of Home City received compensation exceeding $100,000 during the fiscal year ended June 30, 1996.

SUMMARY COMPENSATION TABLE

-------------------------------------------------------------------------------------------------
                                                    Annual Compensation
                                              ---------------------------------
Name and Principal              Fiscal Year                                       All Other
Position                       ended June 30   Salary ($)(1)     Bonus ($)     Compensation(2)

-------------------------------------------------------------------------------------------------
Douglas L. Ulery                   1996           $100,000        $30,000            $3,338
  President and Chief
  Executive Officer
-------------------------------------------------------------------------------------------------


(1) Includes directors' fees of $12,000. Does not include amounts attributable to other miscellaneous benefits received by executive officers. The cost to Home City of providing such benefits to Mr. Ulery was less than 10% of his cash compensation.

(2) Consists of Home City's contribution to Mr. Ulery's 401(k) defined contribution plan account.

EMPLOYEE STOCK OWNERSHIP PLAN

HCFC has established the ESOP for the benefit of employees of HCFC and Home City age 21 or older who have completed at least one year of full-time service with HCFC or Home City. The establishment of the ESOP and the purchase by the ESOP of the Common Shares of HCFC are subject to the receipt of a favorable determination letter on the qualified status of the ESOP under applicable provisions of the Internal Revenue Code of 1986, as amended (the "Code"), from the Commissioner of Internal Revenue ("Commissioner"). HCFC will submit to the Commissioner an application for a favorable determination letter on the qualified status of the ESOP. Although no assurances can be given, HCFC expects that the ESOP will receive a favorable determination letter from the Commissioner.

HCFC intends to accept a promissory note from the ESOP in payment for 8% of the Common Shares sold in connection with the Conversion. The loan will be secured by the shares purchased with the loan proceeds and will be repaid by the ESOP over a period of seven years with funds from Home City's discretionary contributions to the ESOP and earnings on ESOP assets. Shares purchased with such loan proceeds will be held in a suspense account for allocation among participants as the loan is repaid. As payments are made and the shares are released from the suspense account, such shares will be validly issued, fully paid and non-assessable.

Contributions to the ESOP and shares released from the suspense account will be allocated pro rata to participants on the basis of compensation. Except for participants who retire, become disabled or die during the plan year, all other participants must have completed at least 1,000 hours of service and be employed on the last day of the plan year in order to receive an allocation. Benefits become vested at a rate of 20% per year commencing after three years of service and are fully vested after seven years of service. Vesting will be accelerated upon retirement at or after age 65, death, disability or termination of the ESOP. Forfeitures will be reallocated among remaining participating employees. Benefits may be paid either in HCFC Common Shares or in cash. Benefits may be payable upon retirement, death, disability or separation from service. Benefits payable under the ESOP cannot be estimated.

A committee appointed by the Board of Directors of HCFC will administer the ESOP. The Common Shares and other ESOP funds will be held and invested by a trustee (the "ESOP Trustee"). The ESOP Committee may instruct the ESOP Trustee regarding investments of funds contributed to the ESOP. The ESOP Trustee must vote all allocated shares held in the ESOP in accordance with the instructions of the participating employees. Shares for which employees do not give instructions and unallocated shares will be voted by the ESOP Trustee in its sole discretion.

-51-

From time to time, the ESOP may purchase additional Common Shares of HCFC through purchases in the market or directly from HCFC. No such purchases are currently contemplated. If the ESOP purchases newly issued shares from HCFC, such purchases would have a dilutive effect on the interests of HCFC's shareholders.

STOCK OPTION PLAN

The Board of Directors of HCFC expects to adopt the Stock Option Plan, subject to the approval by the shareholders of HCFC. A number of Common Shares equal to 10% of the Common Shares to be issued in connection with the Conversion is expected to be reserved for issuance by HCFC upon the exercise of options to be granted to certain directors, officers and employees of Home City and HCFC from time to time under the Stock Option Plan. The purposes of the Stock Option Plan include retaining and providing incentives to the directors, officers and employees of HCFC and Home City by facilitating their purchase of a stock interest in HCFC.

Options granted to the officers and employees under the Stock Option Plan may be "incentive stock options" within the meaning of Section 422 of the Code (an "ISO"). Options granted under the Stock Option Plan to directors who are not full-time employees of HCFC or Home City will not qualify under the Code and thus will not be incentive stock options ("non-qualified stock options"). Although any eligible director, officer or employee of Home City and HCFC may receive non-qualified stock options, Home City anticipates that the non-employee directors of Home City and HCFC will receive non-qualified stock options, and other eligible participants will receive incentive stock options.

The option exercise price of each option granted under the Stock Option Plan will be determined at the time of grant by a committee of at least three directors appointed to administer the Stock Option Plan (the "Committee"), subject to the requirement that the exercise price for an option must not be less than 100% of the fair market value of the shares on the date of the grant. No stock option will be exercisable after the expiration of ten years from the date that it is granted, except that in the case of an ISO granted to an employee who owns more than 10% of HCFC's outstanding Common Shares at the time an ISO is granted under the Stock Option Plan, the exercise price of such an ISO may not be less than 110% of the fair market value of the shares on the date of the grant, and the ISO shall not be exercisable after the expiration of five years from the date it is granted.

An option recipient cannot transfer or assign an option other than by will or in accordance with the laws of descent and distribution. "Termination for cause," as defined in the Stock Option Plan, will result in the annulment of any outstanding options.

HCFC will receive no monetary consideration for the granting of options under the Stock Option Plan. Upon the exercise of options, HCFC will receive payment of cash, HCFC Common Shares or a combination of cash and Common Shares from option recipients in exchange for shares issued.

The Committee may grant options under the Stock Option Plan at such times as the committee members deem most beneficial to Home City and HCFC on the basis of the individual participant's position, duties and responsibilities, the value of his or her services to Home City and HCFC and any other factors deemed relevant. A grant of options under the Stock Option Plan is expected to occur on the date of approval of the Stock Option Plan by the shareholders of HCFC. The members of the Committee have not yet been appointed and no specific grants have been proposed. The directors of HCFC intend, however, to make such grants in accordance with OTS regulations which provide that no individual may receive options to purchase more than 25% of the shares which may be the subject of options pursuant to the Stock Option Plan, and directors who are not employees of HCFC or Home City may not receive options to purchase more than 5% of such shares individually or 30% in the aggregate.

Pursuant to OTS regulations, the Stock Option Plan may not be approved by the shareholders of HCFC until at least six months after the Conversion is completed. It is expected that options will be granted immediately after the shareholders approve the Stock Option Plan.

RECOGNITION AND RETENTION PLAN AND TRUST

The Board of Directors of Home City intends to adopt the RRP, subject to approval of the shareholders of HCFC, as a means of providing directors and certain key employees of Home City with an ownership interest in HCFC in a manner designed to compensate such directors and key employees for services to Home City. Home City expects to contribute sufficient funds to enable the RRP to purchase Common Shares in the open market or to purchase authorized but unissued shares from HCFC in an

-52-

amount equal to up to 4% of the Common Shares sold in connection with the Conversion. Assuming the sale of 720,000 shares in connection with the Conversion, 28,800 shares would be purchased by the RRP. The purchase of authorized but unissued shares would have a dilutive effect on the interests of HCFC's shareholders. See "CAPITALIZATION" and "PRO FORMA DATA." While no specific awards have yet been proposed, the directors of Home City intend to make such awards in accordance with OTS regulations, which provide that no individual may receive more than 25% of the shares awarded pursuant to the RRP, and directors who are not employees of HCFC or Home City may not receive more than 5% of such shares individually or 30% in the aggregate.

Until shares awarded are earned by the participant, such shares will be forfeited in the event that the employment of the employee is terminated for cause. One-fifth of such shares will be earned and nonforfeitable on each of the first five anniversaries of the date of the awards. In the event of the death or disability of a participant, however, the participant's shares will be deemed to be earned and nonforfeitable upon such date. A committee to be appointed by the Board of Directors of Home City will administer the RRP and determine the number of shares to be awarded to eligible participants. Two directors of Home City are expected to serve as the trustees of the RRP Trust. Each participant will be entitled to the benefit of any dividends or other distributions paid on shares awarded but not yet earned, but such unearned shares will be voted by the trustees in their discretion. Compensation expense in the amount of the fair market value of the Common Shares at the date of the award to the employee will be recognized as the shares are earned. In the event of a termination of a participant's employment following a change in control of Home City or HCFC, all shares awarded to such participant in the RRP become earned and nonforfeitable.

The RRP must be approved by the shareholders of HCFC. Pursuant to OTS regulations, the shareholders may not approve the RRP until six months after the completion of the Conversion. It is expected that the RRP will purchase shares of HCFC and that awards will be made immediately after shareholder approval of the RRP.

EMPLOYMENT AGREEMENT

Home City intends to enter into an employment agreement with Douglas L. Ulery (the "Employment Agreement"). Home City currently has no employment agreements with any of its officers. The Employment Agreement, which will become effective upon completion of the Conversion, provides for a term of three years and a salary and performance review by the Board of Directors not less often than annually, as well as inclusion of the employee in any formally established employee benefit, bonus, pension and profit-sharing plans for which senior management personnel are eligible. The Employment Agreement also provides for vacation and sick leave.

The Employment Agreement is terminable by Home City at any time. In the event of termination by Home City for "just cause," as defined in the Employment Agreement, Mr. Ulery will have no right to receive any compensation or other benefits for any period after such termination. In the event of termination by Home City other than for just cause, at the end of the term of the Employment Agreement or in connection with a "change of control," as defined in the Employment Agreement, Mr. Ulery will be entitled to a continuation of salary payments for a period of time equal to the term of the Employment Agreement and a continuation of benefits substantially equal to those being provided at the date of termination of employment until the earliest to occur of the end of the term of the Employment Agreement or the date the employee becomes employed full-time by another employer.

The Employment Agreement also contains provisions with respect to the occurrence within one year of a "change of control" of (1) the termination of employment of Mr. Ulery for any reason other than just cause, retirement or termination at the end of the term of the agreement, (2) a change in the capacity or circumstances in which he is employed or (3) a material reduction in his responsibilities, authority, compensation or other benefits provided under the Employment Agreement without his written consent. In the event of any such occurrence, Mr. Ulery will be entitled to payment of an amount equal to (a) the amount of compensation to which he would be entitled for the remainder of the term of the Employment Agreement, plus (b) the difference between (i) three times his average annual compensation for the three taxable years immediately preceding the termination of employment, less (ii) the amount paid to Mr. Ulery as compensation for the remainder of the employment term. In addition, Mr. Ulery would be entitled to continued coverage under all benefit plans until the earliest of the end of the term of the Employment Agreement or the date on which he is included in another employer's benefit plans as a full-time employee. The maximum he may receive, however, is limited to an amount which will not result in the imposition of a penalty tax pursuant to Section 280G(b)(3) of the Code or exceed limitations imposed by the OTS. "Control," as defined in the Employment Agreement, generally refers to the acquisition by any person or entity of the ownership or power to vote 10% or more of the voting stock of Home City or HCFC, the control of the election of a majority of Home City's or HCFC's directors or the exercise of a controlling influence over the management or policies of Home City or HCFC.

-53-

The aggregate payment that would have been made to Mr. Ulery assuming his termination at June 30, 1996, following a change of control, would have been approximately $264,000.

CERTAIN TRANSACTIONS WITH HOME CITY

In accordance with OTS regulations, Home City makes loans to executive officers and directors of Home City in the ordinary course of business and on the same terms and conditions, including interest rates and collateral, as those of comparable loans to other persons. All outstanding loans to executive officers and directors were made pursuant to such policy, do not involve more than the normal risk of collectibility or present other unfavorable features and are current in their payments. Loans to all directors and executive officers of Home City and their immediate family members totaled $822,000 at June 30, 1996, which would equal less than eight percent of HCFC's shareholder's equity assuming completion of the Conversion at the mid-point of the Valuation Range.

PROXY HOLDERS

When a deposit account is established at Home City, a general proxy is typically obtained from the depositor, authorizing the Board of Directors to cast all votes which the depositor is entitled to cast on all matters to be submitted to a vote of Home City's members. In the past, the proxyholders appointed by the Board of Directors have been able to elect all members of the Board of Directors and otherwise control the affairs of Home City. After the Conversion, only HCFC, as the sole shareholder of Home City, will be entitled to vote on matters requiring approval by the shareholders of Home City.

REGULATION

GENERAL

As a savings association organized under the laws of the United States, Home City is subject to regulatory oversight by the OTS. Because Home City's deposits are insured by the FDIC, Home City is also subject to examination and regulation by the FDIC. Home City must file periodic reports with the OTS concerning its activities and financial condition. Examinations are conducted periodically by the OTS to determine whether Home City is in compliance with various regulatory requirements and is operating in a safe and sound manner. Home City is a member of the FHLB of Cincinnati.

HCFC also will be subject to regulation, examination and oversight by the OTS as the holding company of Home City and will be required to submit periodic reports to the OTS.

Legislation to recapitalize the SAIF became effective September 30, 1996. See "FDIC Regulations -- Assessments." In connection with such legislation, Home City may be regulated under federal law in the same fashion as banks. As a result, Home City may become subject to additional regulation, examination and oversight by the FDIC. In addition, HCFC might become a bank holding company, subject to examination, regulation and oversight by the Board of Governors of the Federal Reserve ("FRB"), including greater activity and capital requirements than imposed on it by the OTS.

OTS REGULATIONS

GENERAL. The OTS is an office in the Department of the Treasury and is responsible for the regulation and supervision of all savings associations the deposits of which are insured by the FDIC in the SAIF and all federally chartered savings institutions. The OTS issues regulations governing the operation of savings associations, regularly examines such institutions and imposes assessments on savings associations based on their asset size to cover the costs of this supervision and examination. It also promulgates regulations that prescribe the permissible investments and activities of federally chartered savings associations, including the type of lending that such associations may engage in and the investments in real estate, subsidiaries and securities they may make. The OTS also may initiate enforcement actions against savings associations and certain persons affiliated with them for violations of laws or regulations or for engaging in unsafe or unsound practices. If the grounds provided by law exist, the OTS may appoint a conservator or receiver for a savings association.

Federally chartered savings associations are subject to regulatory oversight by the OTS under various consumer protection and fair lending laws. These laws govern, among other things, truth-in-lending disclosure, equal credit opportunity, fair credit reporting and community reinvestment. Failure to abide by federal laws and regulations governing community reinvestment could limit the ability of an association to open a new branch or engage in a merger transaction. Community

-54-

reinvestment regulations evaluate how well and to what extent an institution lends and invests in its designated service area, with particular emphasis on low-to-moderate income areas and borrowers. Home City has received a "Satisfactory" examination rating under those regulations.

REGULATORY CAPITAL REQUIREMENTS. Home City is required by OTS regulations to meet certain minimum capital requirements. These requirements call for tangible capital of 1.5% of adjusted total assets, core capital (which for Home City is equal to tangible capital) of 3% of adjusted total assets, and risk-based capital (which for Home City consists of core capital and general valuation allowances) equal to 8% of risk-weighted assets. Assets and certain off balance sheet items are weighted at percentage levels ranging from 0% to 100% depending on their relative risk.

The OTS has proposed to amend the core capital requirement so that those associations that do not have the highest examination rating and exceed an acceptable level of risk will be required to maintain core capital of from 4% to 5%, depending on Home City's examination rating and overall risk. Home City does not anticipate that it will be adversely affected if the core capital requirement regulation is amended as proposed. Home City's core capital ratio at June 30, 1996, was 9.48% and will increase to 13.45% on a pro forma basis at June 30, 1996, assuming the receipt of approximately $3.4 million in net proceeds from the sale of the Common Shares at the mid-point of the Valuation Range and the investment of 50% of the net proceeds by HCFC in Home City. For information concerning Home City's capital, see "REGULATORY CAPITAL COMPLIANCE."

The OTS has adopted an interest rate risk component to the risk-based capital requirement, though the implementation of that component has been delayed. Pursuant to that requirement, a savings association would have to measure the effect of an immediate 200 basis point change in interest rates on the value of its portfolio as determined under the methodology of the OTS. If the measured interest rate risk is above the level deemed normal under the regulation, Home City will be required to deduct one-half of such excess exposure from its total capital when determining its risk-based capital. In general, an association with less than $300 million in assets and a risk-based capital ratio in excess of 12% will not be subject to the interest rate risk component, and Home City currently qualifies for such exemption. Pending implementation of the interest rate risk component, the OTS has the authority to impose a higher individualized capital requirement on any savings association it deems to have excess interest rate risk. The OTS also may adjust the risk-based capital requirement on an individualized basis to take into account risks due to concentrations of credit and non-traditional activities.

The OTS has adopted regulations governing prompt corrective action to resolve the problems of capital deficient and otherwise troubled savings associations. At each successively lower capital category, an institution is subject to more restrictive and numerous mandatory or discretionary regulatory actions or limits, and the OTS has less flexibility in determining how to resolve the problems of the institution. In addition, the OTS can downgrade an association's designation notwithstanding its capital level, based on less than satisfactory examination ratings in areas other than capital or, after notice and an opportunity for hearing, if the institution is deemed to be in an unsafe or unsound condition or to be engaging in an unsafe or unsound practice. Each undercapitalized association must submit a capital restoration plan to the OTS within 45 days after it becomes undercapitalized. Such institution will be subject to increased monitoring and asset growth restrictions and will be required to obtain prior approval for acquisitions, branching and engaging in new lines of business. A critically undercapitalized institution must be placed in conservatorship or receivership within 90 days after reaching such capitalization level, except under limited circumstances. Home City's capital at June 30, 1996, meets the standards for a well-capitalized association.

Federal law prohibits an insured institution from making a capital distribution to anyone or paying management fees to any person having control of the institution if, after such distribution or payment, the institution would be undercapitalized. In addition, each company controlling an undercapitalized institution must guarantee that the institution will comply with the terms of an OTS-approved capital plan until the institution has been adequately capitalized on an average during each of four consecutive calendar quarters and must provide adequate assurances of performance. The aggregate liability pursuant to such guarantee is limited to the lesser of (a) an amount equal to 5% of the institution's total assets at the time the institution became undercapitalized or (b) the amount which is necessary to bring the institution into compliance with all capital standards applicable to such institution at the time the institution fails to comply with its capital restoration plan.

LIMITATIONS ON CAPITAL DISTRIBUTIONS. The OTS imposes various restrictions or requirements on the ability of associations to make capital distributions according to ratings of associations based on their capital level and supervisory condition. Capital distributions, for purposes of such regulation, include, without limitation, payments of cash dividends, repurchases and certain other acquisitions by an association of its shares and payments to stockholders of another association in an acquisition of such other association.

-55-

The first rating category is Tier 1, consisting of associations that, before and after the proposed capital distribution, meet their fully phased-in capital requirement. Associations in this category may make capital distributions during any calendar year equal to the greater of 100% of its net income, current year-to-date, plus 50% of the amount by which the lesser of Home City's tangible, core or risk-based capital exceeds its fully phased-in capital requirement for such capital component, as measured at the beginning of the calendar year, or the amount authorized for a Tier 2 association. The second category, Tier 2, consists of associations that, before and after the proposed capital distribution, meet their current minimum, but not fully phased-in capital requirement. Associations in this category may make capital distributions up to 75% of their net income over the most recent four quarters. Tier 3 associations do not meet their current minimum capital requirement and must obtain OTS approval of any capital distribution. A Tier 1 association deemed to be in need of more than normal supervision by the OTS may be treated as a Tier 2 or a Tier 3 association.

Home City meets the requirements for a Tier 1 association and has not been notified of any need for more than normal supervision. As a subsidiary of HCFC, Home City will also be required to give the OTS 30 days' notice prior to declaring any dividend on its common shares. The OTS may object to the dividend during that 30-day period based on safety and soundness concerns. Moreover, the OTS may prohibit any capital distribution otherwise permitted by regulation if the OTS determines that such distribution would constitute an unsafe or unsound practice.

In December 1994, the OTS issued a proposal to amend the capital distribution limits. Under that proposal, an association not owned by a holding company and having a CAMEL examination rating of 1 or 2 could make a capital distribution without notice to the OTS, if it remains adequately capitalized, as described above, after the distribution is made. Any other association seeking to make a capital distribution that would not cause Home City to fall below the capital levels to qualify as adequately capitalized or better would have to provide notice to the OTS. Except under limited circumstances and with OTS approval, no capital distribution would be permitted if it would cause Home City to become undercapitalized or worse.

LIQUIDITY. OTS regulations require that each savings association maintain an average daily balance of liquid assets (cash, certain time deposits, bankers' acceptances and specified United States government, state or federal agency obligations) equal to a monthly average of not less than 5% of its net withdrawable savings deposits plus borrowings payable in one year or less. Federal regulations also require each member institution to maintain an average daily balance of short-term liquid assets of 1% of the total of its net withdrawable savings accounts and borrowings payable in one year or less. Monetary penalties may be imposed upon member institutions failing to meet these liquidity requirements. The eligible liquidity of Home City, as computed under current regulations, at June 30, 1996, was approximately $4.0 million, or 8.5%, and exceeded the then applicable 5% liquidity requirement by approximately $1.6 million, or 3.5%.

QUALIFIED THRIFT LENDER TEST. Savings associations are required to maintain a specified level of investments in assets that are designated as qualifying thrift investments. Such investments are generally related to domestic residential real estate and manufactured housing and include stock issued by any FHLB, the FHLMC or the FNMA. The QTL test requires that 65% of an institution's "portfolio assets" (total assets less goodwill and other intangibles, property used to conduct business and 20% of liquid assets) consist of qualified thrift investments on a monthly average basis in 9 out of every 12 months. The OTS may grant exceptions to the QTL test under certain circumstances. If a savings association fails to meet the QTL Test, Home City and its holding company will be subject to certain operating restrictions. A savings association that fails to meet the QTL Test will not be eligible for FHLB advances to the fullest possible extent. See "Federal Home Loan Banks." At June 30, 1996, Home City had QTL investments equal to approximately 78.3% of its total portfolio assets.

LENDING LIMIT. OTS regulations generally limit the aggregate amount that a savings association can lend to one borrower to an amount equal to 15% of Home City's total capital under the regulatory capital requirements plus any additional loan reserve not included in total capital. A savings association may loan to one borrower an additional amount not to exceed 10% of total capital plus additional reserves if the additional loan amount is fully secured by certain forms of "readily marketable collateral." Real estate is not considered "readily marketable collateral." Certain types of loans are not subject to these limits. In applying these limits, loans to certain borrowers may be aggregated. Based on such limits, Home City is able to lend up to $834,000 to one borrower. Notwithstanding the specified limits, an association may lend to one borrower up to $500,000 "for any purpose." See "THE BUSINESS OF HOME CITY - Lending Activities -- Loan Originations, Purchases and Sales."

TRANSACTIONS WITH INSIDERS AND AFFILIATES. Loans to executive officers, directors and principal shareholders and their related interests must conform to the lending limits on loans to one borrower and the total of such loans cannot exceed Home City's total regulatory capital plus additional loan reserves (or 200% of such capital amount for qualifying institutions with less than $100 million in assets). Most loans to directors, executive officers and principal shareholders must be approved in advance by a majority of the "disinterested" members of the board of directors of Home City with any "interested" director not

-56-

participating. All loans to directors, executive officers and principal shareholders must be made on terms substantially the same as offered in comparable transactions to the general public. Loans to executive officers are subject to additional limitations. Home City was in compliance with such restrictions at June 30, 1996. See "MANAGEMENT OF HOME CITY - Certain Transactions with Home City."

Savings associations must comply with Sections 23A and 23B of the Federal Reserve Act (the "FRA") pertaining to transactions with affiliates. An affiliate of a savings association is any company or entity that controls, is controlled by or is under common control with the savings association. After the Conversion, HCFC will be an affiliate of Home City. Generally, Sections 23A and 23B of the FRA (i) limit the extent to which the savings institution or its subsidiaries may engage in "covered transactions" with any one affiliate to an amount equal to 10% of such institution's capital stock and surplus, (ii) limit the aggregate of all such transactions with all affiliates to an amount equal to 20% of such capital stock and surplus, and (iii) require that all such transactions be on terms substantially the same, or at least as favorable to the institution, as those provided in transactions with a non-affiliate. The term "covered transaction" includes the making of loans, purchase of assets, issuance of a guarantee and other similar types of transactions. In addition to the limits in Sections 23A and 23B, a savings association may not make any loan or other extension of credit to an affiliate unless the affiliate is engaged only in activities permissible for a bank holding company and may not purchase or invest in securities of any affiliate except shares of a subsidiary. Home City was in compliance with these requirements and restrictions at June 30, 1996.

HOLDING COMPANY REGULATION. Upon consummation of the Conversion, HCFC will be a savings and loan holding company within the meaning of the Home Owners' Loan Act (the "HOLA"). As such, HCFC will register with the OTS and will be subject to OTS regulations, examination, supervision and reporting requirements, in addition to the reporting requirements of the Securities and Exchange Commission (the "SEC"). Congress is considering legislation which may require that HCFC become a bank holding company regulated by the FRB. Bank holding companies with more than $150 million in assets are subject to capital requirements similar to those imposed on Home City and have more extensive interstate acquisition authority than savings and loan holding companies. They are also subject to more restrictive activity and investment limits than savings and loan holding companies. No assurances can be given that such legislation will be enacted, and HCFC cannot be certain of the legislation's impact on its future operations until it is enacted.

The HOLA generally prohibits a savings and loan holding company from controlling any other savings association or savings and loan holding company without prior approval of the OTS, or from acquiring or retaining more than 5% of the voting shares of a savings association or holding company thereof which is not a subsidiary. Under certain circumstances, a savings and loan holding company is permitted to acquire, with the approval of the OTS, up to 15% of the previously unissued voting shares of an undercapitalized savings association for cash without such savings association being deemed to be controlled by the holding company. Except with the prior approval of the OTS, no director or officer of a savings and loan holding company or person owning or controlling by proxy or otherwise more than 25% of such company's stock may also acquire control of any savings institution, other than a subsidiary institution, or any other savings and loan holding company.

The Board of Directors presently intends to operate HCFC as a unitary savings and loan holding company. There are generally no restrictions on the activities of a unitary savings and loan holding company, and such companies are the only financial institution holding companies which may engage in commercial, securities and insurance activities without limitation. Congress is considering, however, either limiting unitary savings and loan holding companies to the same activities as other financial institution holding companies or permitting certain bank holding companies to engage in commercial activities and expanded securities and insurance activities. HCFC cannot predict if and in what form these proposals might become law. The broad latitude to engage in activities under current law can be restricted, however, if the OTS determines that there is reasonable cause to believe that the continuation by a savings and loan holding company of an activity constitutes a serious risk to the financial safety, soundness or stability of its subsidiary savings association. The OTS may impose such restrictions as deemed necessary to address such risk, including limiting (i) payment of dividends by the savings association, (ii) transactions between the savings association and its affiliates, and (iii) any activities of the savings association that might create a serious risk that the liabilities of the holding company and its affiliates may be imposed on the savings association. Notwithstanding the foregoing rules as to permissible business activities of a unitary savings and loan holding company, if the savings association subsidiary of a holding company fails to meet the QTL Test, then such unitary holding company would become subject to the activities restrictions applicable to multiple holding companies. At June 30, 1996, Home City met the QTL Test. See "Qualified Thrift Lender Test."

If HCFC were to acquire control of another savings institution other than through a merger or other business combination with Home City, HCFC would thereupon become a multiple savings and loan holding company. Except where such acquisition is pursuant to the authority to approve emergency thrift acquisitions and where each subsidiary savings

-57-

association meets the QTL Test, the activities of HCFC and any of its subsidiaries (other than Home City or other subsidiary savings associations) would thereafter be subject to further restrictions. The HOLA provides that, among other things, no multiple savings and loan holding company or subsidiary thereof which is not a savings institution shall commence, or shall continue after becoming a multiple savings and loan holding company or subsidiary thereof, any business activity other than (i) furnishing or performing management services for a subsidiary savings institution, (ii) conducting an insurance agency or escrow business, (iii) holding, managing or liquidating assets owned by or acquired from a subsidiary savings institution, (iv) holding or managing properties used or occupied by a subsidiary savings institution, (v) acting as trustee under deeds of trust, (vi) those activities previously directly authorized by federal regulation as of March 5, 1987, to be engaged in by multiple holding companies, or (vii) those activities authorized by the FRB as permissible for bank holding companies, unless the OTS by regulation prohibits or limits such activities for savings and loan holding companies. Those activities described in (vii) above must also be approved by the OTS prior to being engaged in by a multiple holding company.

The OTS may also approve acquisitions resulting in the formation of a multiple savings and loan holding company that controls savings associations in more than one state, if the multiple savings and loan holding company involved controls a savings association which operated a home or branch office in the state of Home City to be acquired as of March 5, 1987, or if the laws of the state in which the institution to be acquired is located specifically permit institutions to be acquired by state-chartered institutions or savings and loan holding companies located in the state where the acquiring entity is located (or by a holding company that controls such state-chartered savings institutions). As under prior law, the OTS may approve an acquisition resulting in a multiple savings and loan holding company controlling savings associations in more than one state in the case of certain emergency thrift acquisitions.

FDIC REGULATIONS

DEPOSIT INSURANCE. The FDIC is an independent federal agency that insures the deposits, up to prescribed statutory limits, of federally insured banks and thrifts and safeguards the safety and soundness of the bank and thrift industries. The FDIC administers two separate insurance funds, the BIF for commercial banks and state savings banks and the SAIF for savings associations and banks that have acquired deposits from savings associations. The FDIC is required to maintain designated levels of reserves in each fund. The reserves of the SAIF are below the level required by law because a significant portion of the assessments paid into the fund are used to pay the cost of prior thrift failures. The reserves of the BIF met the level required by law in May 1995.

Depository institutions are generally prohibited from converting from one insurance fund to the other until the SAIF meets its designated reserve level, except with the prior approval of the FDIC in certain limited cases, provided applicable exit and entrance fees are paid. The insurance fund conversion provisions do not prohibit a SAIF member from converting to a bank charter or merging with a bank during the moratorium, as long as the resulting bank continues to pay the applicable insurance assessments to the SAIF during that period and certain other conditions are met.

Home City is a member of the SAIF and its deposit accounts are insured by the FDIC up to the prescribed limits. The FDIC has examination authority over all insured depository institutions, including Home City, and has authority to initiate enforcement actions against federally insured savings associations if the FDIC does not believe the OTS has taken appropriate action to safeguard safety and soundness and the deposit insurance fund.

ASSESSMENTS. The FDIC is authorized to establish separate annual assessment rates for deposit insurance for members of the BIF and members of the SAIF. The FDIC may increase assessment rates for either fund if necessary to restore the fund's ratio of reserves to insured deposits to the target level within a reasonable time and may decrease such rates if such target level has been met. The reserves of the SAIF are below the level required by law because a significant portion of the assessments paid into the SAIF are used to pay the costs of prior thrift failures. The BIF has, however, met its required reserve level.

Assessments paid by healthy savings associations exceeded those paid by healthy commercial banks by approximately $.19 per $100 in deposits in late 1995 and no BIF assessments have been required of healthy commercial banks in 1996, except a $2,000 minimum fee. Such premium disparity could have a negative competitive impact on HCFC and other institutions with SAIF deposits.

Legislation to recapitalize the SAIF and to eliminate the significant premium disparity between the BIF and the SAIF became effective September 30, 1996. The recapitalization plan provides for a special assessment to be paid by November 29, 1996, equal to $.657 per $100 of SAIF deposits held at March 31, 1995. The special assessment will increase

-58-

SAIF reserves to the level required by law. Certain BIF institutions holding SAIF insured deposits will pay a lower special assessment. In addition, the cost of prior thrift failures will be shared by both the SAIF and the BIF, which will increase BIF assessments. After the payment of the special assessment, SAIF assessments for healthy savings associations will be set at a significantly lower level but can never be reduced below the level set for healthy BIF institutions

On the basis of its $40.4 million in deposits at March 31, 1995, Home City will pay, by November 29, 1996, an additional pre-tax assessment of $265,000. Such payment was recorded as an expense and accounted for by Home City as of September 30, 1996. Earnings and capital were, therefore, negatively affected for the quarter ended September 30, 1996.

The recapitalization plan also provides for the merger of the SAIF and BIF effective January 1, 1999, assuming all savings associations have become banks. As a result, it is expected that the thrift charter or the separate federal regulation of thrifts will be eliminated. As a result, Home City would be regulated under federal law as a bank, and would become subject to the more restrictive activity limitations imposed on national banks.

In addition, HCFC would become a bank holding company, which would be subject to more restrictive activity limits and capital requirements similar to those imposed on Home City. HCFC cannot predict the impact of the conversion of Home City to, or regulation of Home City as, a bank until the legislation requiring such charge is enacted.

FRB REGULATIONS

RESERVE REQUIREMENTS. FRB regulations require savings associations to maintain reserves against their transaction accounts (primarily NOW accounts) of 3% of deposits in net transaction accounts for that portion of accounts in excess of $4.3 million up to $52 million, and to maintain reserves of 10% of deposits in net transaction accounts against that portion of total transaction accounts in excess of $52 million. These percentages are subject to adjustment by the FRB. At June 30, 1996, Home City was in compliance with its reserve requirements.

FEDERAL HOME LOAN BANKS

The FHLBs, under the regulatory oversight of the Federal Housing Financing Board, provide credit to their members in the form of advances. Home City is a member of the FHLB of Cincinnati and must maintain an investment in the capital stock of the FHLB of Cincinnati in an amount equal to the greater of 1.0% of the aggregate outstanding principal amount of Home City's residential mortgage loans, home purchase contracts and similar obligations at the beginning of each year, or 5% of its advances from the FHLB. Home City is in compliance with this requirement with an investment in FHLB of Cincinnati stock of $394,000 at June 30, 1996.

FHLB advances to members such as Home City who meet the QTL test are generally limited to the lower of (i) 25% of the member's assets and (ii) 20 times the member's investment in FHLB stock. At June 30, 1996, Home City's maximum limit on advances was approximately $7.9 million. The granting of advances is subject also to the FHLB's collateral and credit underwriting guidelines. At June 30, 1996, the FHLB of Cincinnati offered advances with fixed and variable interest rates ranging from 5.6% to 8.3%, which included the following types of borrowings: short-term advances with terms ranging from one day to one year, including cash management accounts and lines of credit; fixed-rate, long-term advances with terms ranging from seven months to 20 years; and various customized advances with terms ranging from one month to 30 years and with call, balloon or mortgage-matching features.

Upon the origination or renewal of a loan or advance, the FHLB of Cincinnati is required by law to obtain and maintain a security interest in collateral in one or more of the following categories: fully disbursed, whole first mortgage loans on improved residential property or securities representing a whole interest in such loans; securities issued, insured or guaranteed by the United States government or an agency thereof; deposits in any FHLB; or other real estate related collateral (up to 30% of the member association's capital) acceptable to the applicable FHLB, if such collateral has a readily ascertainable value and the FHLB can perfect its security interest in the collateral.

Each FHLB is required to establish standards of community investment or service that its members must maintain for continued access to long-term advances from the FHLBs. The standards take into account a member's performance under the Community Reinvestment Act and its record of lending to first-time home buyers. All long-term advances by each FHLB must be made only to provide funds for residential housing finance. The FHLBs have established an "Affordable Housing Program" to subsidize the interest rate of advances to member associations engaged in lending for long-term, low- and moderate-income,

-59-

owner-occupied and affordable rental housing at subsidized rates. The FHLB of Cincinnati reviews and accepts proposals for subsidies under that program twice a year. Home City has participated in such program.

TAXATION

FEDERAL TAXATION

HCFC is subject to the federal tax laws and regulations which apply to corporations generally. Home City is also subject to the federal tax laws and regulations which apply to corporations generally. However, certain thrift institutions such as Home City were, prior to the enactment of the Small Business Jobs Protection Act, which was signed into law on August 21, 1996, allowed deductions for bad debts under methods more favorable to those granted to other taxpayers. Qualified thrift institutions could compute deductions for bad debts using either the specific charge off method of Section 166 of the Code or the reserve method of Section 593 of the Code.

Under Section 593, a thrift institution annually could elect to deduct bad debts under either (i) the "percentage of taxable income" method applicable only to thrift institutions, or (ii) the "experience" method that also was available to small banks. Under the "percentage of taxable income" method, a thrift institution generally was allowed a deduction for an addition to its bad debt reserve equal to 8% of its taxable income (determined without regard to this deduction and with additional adjustments). Under the experience method, a thrift institution was generally allowed a deduction for an addition to its bad debt reserve equal to the greater of (i) an amount based on its actual average experience for losses in the current and five preceding taxable years, or (ii) an amount necessary to restore the reserve to its balance as of the close of the base year. A thrift institution could elect annually to compute its allowable addition to bad debt reserves for qualifying loans either under the experience method or the percentage of taxable income method. For tax years 1993, 1992 and 1991, Home City used the percentage of taxable income method because such method provided a higher bad debt deduction than the experience method.

Section 1616(a) of the Small Business Job Protection Act repealed the Section 593 reserve method of accounting for bad debts by thrift institutions, effective for taxable years beginning after 1995. Thrift institutions that would be treated as small banks are allowed to utilize the experience method applicable to such institutions, while thrift institutions that are treated as large banks are required to use only the specific charge off method. The percentage of taxable income method of accounting for bad debts is no longer available for any financial institution.

A thrift institution required to change its method of computing reserves for bad debt will treat such change as a change in the method of accounting, initiated by the taxpayer, and having been made with the consent of the Secretary of the Treasury. Any adjustments under Section 481(a) of the Code required to be recaptured with respect to such change generally will be determined solely with respect to the "applicable excess reserves" of the taxpayer. The amount of the applicable excess reserves will be taken into account ratably over a six-taxable year period, beginning with the first taxable year beginning after 1995, subject to the residential loan requirement described below. In the case of a thrift institution that becomes a large bank, the amount of the institution's applicable excess reserves generally is the excess of (i) the balances of its reserve for losses on qualifying real property loans (generally loans secured by improved real estate) and its reserve for losses on nonqualifying loans (all other types of loans) as of the close of its last taxable year beginning before January 1, 1996, over (ii) the balances of such reserves as of the close of its last taxable year beginning before January 1, 1988 (i.e., the "pre-1988 reserves"). In the case of a thrift institution that becomes a small bank, like Home City, the amount of the institution's applicable excess reserves generally is the excess of (i) the balances of its reserve for losses on qualifying real property loans and its reserve for losses on nonqualifying loans as of the close of its last taxable year beginning before January 1, 1996, over (ii) the greater of the balance of (a) its pre-1988 reserves or (b) what the thrift's reserves would have been at the close of its last year beginning before January 1, 1996, had the thrift always used the experience method.

For taxable years that begin after December 31, 1995, and before January 1, 1998, if a thrift meets the residential loan requirement for a tax year, the recapture of the applicable excess reserves otherwise required to be taken into account as a Code Section 481(a) adjustment for the year will be suspended. A thrift meets the residential loan requirement if, for the tax year, the principal amount of residential loans made by the thrift during the year is not less then its base amount. The "base amount" generally is the average of the principal amounts of the residential loans made by the thrift during the six most recent tax years beginning before January 1, 1996.

-60-

A residential loan is a loan as described in Section 7701(a)(19)(C)(v) (generally a loan secured by residential real and church property and certain mobile homes), but only to the extent that the loan is made to the owner of the property to acquire, construct, or improve the property.

In addition to the regular income tax, HCFC and Home City are subject to a minimum tax. An alternative minimum tax is imposed at a minimum tax rate of 20% on "alternative minimum taxable income" (which is the sum of a corporation's regular taxable income, with certain adjustments, and tax preference items), less any available exemption. Such tax preference items include interest on certain tax-exempt bonds issued after August 7, 1986. In addition, 75% of the amount by which a corporation's "adjusted current earnings" exceeds its alternative minimum taxable income computed without regard to this preference item and prior to reduction by net operating losses, is included in alternative minimum taxable income. Net operating losses can offset no more than 90% of alternative minimum taxable income. The alternative minimum tax is imposed to the extent it exceeds the corporation's regular income tax. Payments of alternative minimum tax may be used as credits against regular tax liabilities in future years. In addition, for taxable years after 1986 and before 1996, HCFC and Home City are also subject to an environmental tax equal to 0.12% of the excess of alternative minimum taxable income for the taxable year (determined without regard to net operating losses and the deduction for the environmental tax) over $2.0 million.

The balance of the pre-1988 reserves is subject to the provisions of Section 593(e) as modified by the Small Business Job Protection Act which requires recapture in the case of certain excessive distributions to shareholders. The pre-1988 reserves may not be utilized for payment of cash dividends or other distributions to a shareholder (including distributions in dissolution or liquidation) or for any other purpose (except to absorb bad debt losses). Distribution of a cash dividend by a thrift institution to a shareholder is treated as made: first, out of the institution's post-1951 accumulated earnings and profits; second, out of the pre-1988 reserves; and third, out of such other accounts as may be proper. To the extent a distribution by Home City to HCFC is deemed paid out of its pre-1988 reserves under these rules, the pre-1988 reserves would be reduced and Home City's gross income for tax purposes would be increased by the amount which, when reduced by the income tax, if any, attributable to the inclusion of such amount in its gross income, equals the amount deemed paid out of the pre-1988 reserves. As of June 30, 1996, Home City's pre-1988 reserves for tax purposes totaled approximately $1.1 million. Home City believes it had approximately $4.2 million of accumulated earnings and profits for tax purposes as of June 30, 1996, which would be available for dividend distributions, provided regulatory restrictions applicable to the payment of dividends are met. No representation can be made as to whether Home City will have current or accumulated earnings and profits in subsequent years.

The tax returns of Home City have been audited or closed without audit through fiscal year 1992. In the opinion of management, any examination of open returns would not result in a deficiency which could have a material adverse effect on the financial condition of Home City.

OHIO TAXATION

HCFC is subject to the Ohio corporation franchise tax, which, as applied to HCFC, is a tax measured by both net earnings and net worth. The rate of tax is the greater of (i) 5.1% on the first $50,000 of computed Ohio taxable income and 8.9% of computed Ohio taxable income in excess of $50,000 or (ii) 0.582% times taxable net worth.

In computing its tax under the net worth method, HCFC may exclude 100% of its investment in the capital stock of Home City after the Conversion, as reflected on the balance sheet of HCFC, in computing its taxable net worth as long as it owns at least 25% of the issued and outstanding capital stock of Home City. The calculation of the exclusion from net worth is based on the ratio of the excludable investment (net of any appreciation or goodwill included in such investment) to total assets multiplied by the net value of the stock. As a holding company, HCFC may be entitled to various other deductions in computing taxable net worth that are not generally available to operating companies.

A special litter tax is also applicable to all corporations, including HCFC, subject to the Ohio corporation franchise tax other than "financial institutions." If the franchise tax is paid on the net income basis, the litter tax is equal to .11% of the first $50,000 of computed Ohio taxable income and .22% of computed Ohio taxable income in excess of $50,000. If the franchise tax is paid on the net worth basis, the litter tax is equal to .014% times taxable net worth.

Home City is a "financial institution" for State of Ohio tax purposes. As such, it is subject to the Ohio corporate franchise tax on "financial institutions," which is imposed annually at a rate of 1.5% of Home City's book net worth determined

-61-

in accordance with GAAP. As a "financial institution," Home City is not subject to any tax based upon net income or net profits imposed by the State of Ohio.

THE CONVERSION

THE OTS HAS APPROVED THE PLAN, SUBJECT TO THE APPROVAL OF THE PLAN BY THE MEMBERS OF HOME CITY ENTITLED TO VOTE ON THE PLAN AND SUBJECT TO THE SATISFACTION OF CERTAIN OTHER CONDITIONS IMPOSED BY THE OTS. OTS APPROVAL DOES NOT CONSTITUTE A RECOMMENDATION OR ENDORSEMENT OF THE PLAN.

GENERAL

On September 3, 1996, the Board of Directors of Home City unanimously adopted a Plan of Conversion and recommended that the voting members of Home City approve the Plan at the Special Meeting to be held on ___________, 1996. During and upon completion of the Conversion, Home City will continue to provide the services presently offered to depositors and borrowers, will maintain its existing offices and will retain its existing management and employees.

Based on the current Valuation Range, between 612,000 and 952,200 Common Shares are expected to be offered in the Subscription Offering and the Community Offering in which preference will be given to natural persons residing in Clark County, Ohio, at a price of $10 per share. Federal regulations require, with certain exceptions, that shares offered in connection with the Conversion must be sold up to at least the minimum point of the Valuation Range in order for the Conversion to become effective. The actual number of shares sold in connection with the Conversion will be determined upon completion of the Conversion in the sole discretion of the Board of Directors based upon the final determination of the pro forma market value of Home City at the completion of the Subscription Offering and the Community Offering. See "Pricing and Number of Common Shares to be Sold."

The Common Shares will be offered in the Subscription Offering to (1) each account holder of Home City who, as of June 30, 1995, had a Qualifying Deposit ("Eligible Account Holders"), (2) the ESOP, (3) each account holder of Home City who, as of September 30, 1996, had a Qualifying Deposit ("Supplemental Eligible Account Holders"), and (4) each account holder of Home City having a savings deposit of record with Home City on October 31, 1996 (the "Voting Record Date"), and each borrower of record on the Voting Record Date whose loan was outstanding on May 1, 1996 (such depositors and borrowers as of October 31, 1996, collectively, the "Voting Members"). Any Common Shares not subscribed for in the Subscription Offering may be sold to the general public in the Community Offering in a manner which will seek to achieve the widest distribution of the Common Shares, but which will give preference to natural persons residing in Clark County, Ohio. Under OTS regulations, the Community Offering must be completed within 45 days after completion of the Subscription Offering, unless such period is extended by Home City with the approval of the OTS. If the Community Offering is determined not to be feasible, an occurrence that is not currently anticipated, the Board of Directors of Home City will consult with the OTS to determine an appropriate alternative method of selling unsubscribed Common Shares. No alternative sales methods are currently planned.

OTS regulations require the completion of the Conversion within 24 months after the date of the approval of the Plan by the Voting Members of Home City. The commencement and completion of the Conversion will be subject to market conditions and other factors beyond Home City's control. Due to changing economic and market conditions, no assurance can be given as to the length of time that will be required to complete the sale of the Common Shares. If delays are experienced, significant changes may occur in the estimated pro forma market value of Home City, together with corresponding changes in the aggregate offering price and the net proceeds realized by HCFC from the sale of the Common Shares. In such circumstances, Home City may also incur substantial additional printing, legal and accounting expenses in completing the Conversion. In the event the Conversion is not successfully completed, Home City will be required to charge all Conversion expenses against current earnings.

The following is a summary of the material aspects of the Conversion. The summary is qualified in its entirety by reference to the provisions of the Plan, a copy of which may be inspected at each office of Home City and at the office of the OTS. The Plan is also filed as an exhibit to the Registration Statement of which this Prospectus is a part, and copies of the Registration Statement may be obtained from the SEC. See "ADDITIONAL INFORMATION."

-62-

PRINCIPAL EFFECTS OF THE CONVERSION

VOTING RIGHTS. Savings account holders who are members of Home City in its mutual form will have no voting rights in Home City as converted and will not participate, therefore, in the election of directors or otherwise control Home City's affairs. After the Conversion, voting rights in Home City will be vested exclusively in HCFC as the sole shareholder of Home City. Voting rights in HCFC will be held exclusively by its shareholders. Each holder of HCFC's Common Shares will be entitled to one vote for each Common Share owned on any matter to be considered by HCFC's shareholders. See "DESCRIPTION OF AUTHORIZED SHARES."

SAVINGS ACCOUNTS AND LOANS. Savings accounts in Home City, as converted, will be equivalent in amount, interest rate and other terms to the present savings accounts in Home City, and the existing FDIC insurance on such deposits will not be affected by the Conversion. The Conversion will not affect the terms of loan accounts or the rights and obligations of borrowers under their individual contractual arrangements with Home City.

TAX CONSEQUENCES. The consummation of the Conversion is expressly conditioned on receipt by Home City of a private letter ruling from the Internal Revenue Service (the "IRS") or an opinion of counsel to the effect that the Conversion will constitute a tax-free reorganization as defined in Section 368(a) of the Code. Home City intends to proceed with the Conversion based upon an opinion rendered by its special counsel, Vorys, Sater, Seymour and Pease, which opinion is an exhibit to the Registration Statement on Form S-1 (File No. 333-12501) filed with the SEC by HCFC, addressing the following federal tax consequences, which are all of the material federal tax consequences of the Conversion:

(1) The Conversion constitutes a reorganization within the meaning of
Section 368(a)(1)(F) of the Code, and no gain or loss will be recognized by Home City in its mutual form or in its stock form as a result of the Conversion. Home City in its mutual form and Home City in its stock form will each be a "party to a reorganization" within the meaning of Section 368(B) of the Code;

(2) No gain or loss will be recognized by Home City upon the receipt of money from HCFC in exchange for the capital stock of Home City, as converted;

(3) The assets of Home City will have the same basis in its hands immediately after the Conversion as it had in its hands immediately prior to the Conversion, and the holding period of the assets of Home City after the Conversion will include the period during which the assets were held by Home City before the Conversion;

(4) No gain or loss will be recognized to the deposit account holders of Home City upon the issuance to them, in exchange for their respective withdrawable deposit accounts in Home City immediately prior to the Conversion, of withdrawable deposit accounts in Home City immediately after the Conversion, in the same dollar amount as their withdrawable deposit accounts in Home City immediately prior to the Conversion, plus, in the case of Eligible Account Holders and Supplemental Eligible Account Holders, the interests in the Liquidation Account of Home City, as described below;

(5) The basis of the withdrawable deposit accounts in Home City held by its deposit account holders immediately after the Conversion will be the same as the basis of their deposit accounts in Home City immediately prior to the Conversion. The basis of the interests in the Liquidation Account received by the Eligible Account Holders and Supplemental Eligible Account Holders will be zero. The basis of the nontransferable subscription rights received by Eligible Account Holders, Supplemental Eligible Account Holders and Other Eligible Members (hereinafter defined) will be zero (assuming that at distribution such rights have no ascertainable fair market value);

(6) No gain or loss will be recognized to Eligible Account Holders, Supplemental Eligible Account Holders or Other Eligible Members upon the distribution to them of nontransferable subscription rights to purchase Common Shares (assuming that at distribution such rights have no ascertainable fair market value), and no taxable income will be realized by such Eligible Account Holders, Supplemental Eligible Account Holders or Other Eligible Members as a result of their exercise of such nontransferable subscription rights;

(7) The basis of the Common Shares purchased by members of Home City pursuant to the exercise of subscription rights will be the purchase price thereof (assuming that such rights have no ascertainable fair market value and that the purchase price is not less than the fair market value of the shares on the date of such exercise), and the holding period of such shares will commence on the date of such exercise. The basis of the Common Shares purchased

-63-

other than by the exercise of subscription rights will be the purchase price thereof (assuming in the case of the other subscribers that the opportunity to buy in the Subscription Offering has no ascertainable fair market value), and the holding period of such shares will commence on the day after the date of the purchase;

(8) For purposes of Section 381 of the Code, Home City will be treated as if there had been no reorganization. The taxable year of Home City will not end on the effective date of the Conversion and, immediately after the Conversion, Home City in its stock form will succeed to and take into account the tax attributes of Home City in its mutual form immediately prior to the Conversion, including Home City's earnings and profits or deficit in earnings and profits;

(9) The bad debt reserves of Home City in its mutual form immediately prior to the Conversion will not be required to be restored to the gross income of Home City in its stock form as a result of the Conversion, and immediately after the Conversion such bad debt reserves will have the same character in the hands of Home City in its stock form as they would have had if there had been no Conversion. Home City in its stock form will succeed to and take into account the dollar amounts of those accounts of Home City in its mutual form which represent bad debt reserves in respect of which Home City in its mutual form has taken a bad debt deduction for taxable years ending on or before the Conversion; and

(10) Regardless of book entries made for the creation of the Liquidation Account, the Conversion will not diminish the accumulated earnings and profits of Home City available for the subsequent distribution of dividends within the meaning of Section 316 of the Code. The creation of the Liquidation Account on the records of Home City will have no effect on its taxable income, deductions for additions to reserves for bad debts under Section 593 of the Code or distributions to stockholders under Section 593(e) of the Code.

Home City has received an opinion from Keller to the effect that the subscription rights have no ascertainable fair market value because the rights are received by specified persons at no cost, may not be transferred and are of short duration. The IRS could challenge the assumption that the subscription rights have no ascertainable fair market value.

For Ohio tax purposes, the tax consequences of the Conversion will be as follows:

(1) Home City is a "financial institution" for State of Ohio tax purposes, and the Conversion will not change such status;

(2) Home City is subject to the Ohio corporate franchise tax on "financial institutions," which is imposed annually at a rate of 1.5% of Home City's equity capital determined in accordance with GAAP, and the Conversion will not change such status;

(3) As a "financial institution," Home City is not subject to any tax based upon net income or net profit imposed by the State of Ohio, and the Conversion will not change such status;

(4) The Conversion will not be a taxable transaction to Home City in its mutual or stock form for purposes of the Ohio corporate franchise tax; however, as a consequence of the Conversion, the annual Ohio corporate franchise tax liability of Home City will increase if the taxable net worth of Home City (i.e., book net worth computed in accordance with GAAP at the close of Home City's taxable year for federal income tax purposes) increases thereby; and

(5) The Conversion will not be a taxable transaction to any deposit account holder or borrower member of Home City in its mutual or stock form for purposes of the Ohio corporate franchise tax and the Ohio personal income tax.

Each Eligible Account Holder, Supplemental Eligible Account Holder and Other Eligible Member is urged to consult his or her own tax advisor with respect to the effect of such tax consequences on his or her own particular facts and circumstances.

LIQUIDATION ACCOUNT. In the unlikely event of a complete liquidation of Home City in its present mutual form, each depositor in Home City would receive a pro rata share of any assets of Home City remaining after payment of the claims of all creditors, including the claims of all depositors to the withdrawable value of their savings accounts. A depositor's pro rata share of such remaining assets would be the same proportion of such assets as the value of such depositor's savings deposits bears to the total aggregate value of all savings deposits in Home City at the time of liquidation.

-64-

In the event of a complete liquidation of Home City in its stock form after the Conversion, each savings depositor as of June 30, 1995, and September 30, 1996, would have a claim of the same general priority as the claims of all other general creditors of Home City. Except as described below, each depositor's claim would be solely in the amount of the balance in such depositor's savings account plus accrued interest. The depositor would have no interest in the assets of Home City above that amount. Such assets would be distributed to HCFC as the sole shareholder of Home City.

For the purpose of granting a limited priority claim to the assets of Home City in the event of a complete liquidation thereof to Eligible Account Holders and Supplemental Eligible Account Holders who continue to maintain savings accounts at Home City after the Conversion, Home City will, at the time of Conversion, establish the Liquidation Account in an amount equal to the regulatory capital of Home City as of the latest practicable date prior to the Conversion at which such regulatory capital can be determined. For this purpose, Home City shall use the regulatory capital figure no later than that set forth in its latest statement of financial condition contained in the Prospectus. The Liquidation Account will not operate to restrict the use or application of any of the regulatory capital of Home City.

Each Eligible Account Holder and Supplemental Eligible Account Holder will have a separate inchoate interest (the "Subaccount") in a portion of the Liquidation Account for Qualifying Deposits held on the Eligibility Record Date or the Supplemental Eligibility Record Date, as the case may be.

The balance of each initial Subaccount shall be an amount determined by multiplying the amount in the Liquidation Account by a fraction, the numerator of which is the closing balance in the account holder's account as of the close of business on the Eligibility Record Date or the Supplemental Eligibility Record Date, as the case may be, and the denominator of which is the total amount of Qualifying Deposits of all Eligible Account Holders and Supplemental Eligible Account Holders on the corresponding record date. The balance of each Subaccount may be decreased but will never be increased. If, at the close of business on any annual closing date of Home City subsequent to the respective record dates the balance in the savings account to which a Subaccount relates is less than the lesser of (i) the deposit balance in such savings account at the close of business on any other annual closing date subsequent to the Eligibility Record Date or Supplemental Eligibility Record Date or (ii) the amount of the Qualifying Deposit as of the Eligibility Record Date or the Supplemental Eligibility Record Date, the balance of the Subaccount for such savings account shall be adjusted proportionately to the reduction in such savings account balance. In the event of any such downward adjustment, such Subaccount balance shall not be subsequently increased notwithstanding any increase in the deposit balance of the related savings account. If any savings account is closed, its related Subaccount shall be reduced to zero upon such closing.

In the event of a complete liquidation of the converted Home City (and only in such event), each Eligible Account Holder and Supplemental Eligible Account Holder shall receive from the Liquidation Account a distribution equal to the current balance in each of such account holder's Subaccounts before any liquidation distribution may be made to HCFC as the sole shareholder of Home City. Any assets remaining after satisfaction of such liquidation rights and the claims of Home City's creditors would be distributed to HCFC as the sole shareholder of Home City. No merger, consolidation, purchase of bulk assets or similar combination or transaction with another institution, the deposits of which are insured by the FDIC, will be deemed to be a complete liquidation for this purpose and, in any such transaction, the Liquidation Account shall be assumed by the surviving institution.

COMMON SHARES. SHARES ISSUED UNDER THE PLAN CANNOT AND WILL NOT BE INSURED BY THE FDIC. For a description of the characteristics of the Common

Shares, see "DESCRIPTION OF AUTHORIZED SHARES."

INTERPRETATION AND AMENDMENT OF THE PLAN

The Boards of Directors of Home City and HCFC will interpret the Plan. To the extent permitted by law, all interpretations of the Plan by the Boards of Directors of Home City and HCFC will be final. The Plan may be amended by the Boards of Directors of Home City and HCFC at any time before completion of the Conversion with the concurrence of the OTS. If Home City and HCFC determine upon advice of counsel and after consultation with the OTS that any such amendment is material, subscribers will be notified of the amendment and will be provided the opportunity to affirm, increase, decrease or cancel their subscriptions. Any person who does not affirmatively elect to continue his subscription or elects to rescind his subscription before the date specified in the notice will have all of his funds promptly refunded with interest. Any person who elects to decrease his subscription will have the appropriate portion of his funds promptly refunded with interest.

-65-

CONDITIONS AND TERMINATION

The completion of the Conversion requires the approval of the Plan and the adoption of the Federal Stock Charter and Federal Stock Bylaws by the Voting Members of Home City at the Special Meeting and the sale of the requisite amount of Common Shares within 24 months following the date of such approval. If these conditions are not satisfied, the Plan will automatically terminate and Home City will continue its business in the mutual form of organization. The Plan may be voluntarily terminated by the Board of Directors at any time before the Special Meeting and at any time thereafter with the approval of the OTS.

SUBSCRIPTION OFFERING

THE SUBSCRIPTION OFFERING WILL EXPIRE AT 4:00 P.M., EASTERN TIME, ON THE SUBSCRIPTION EXPIRATION DATE. SUBSCRIPTION RIGHTS NOT EXERCISED BEFORE THE SUBSCRIPTION EXPIRATION DATE WILL BE VOID, WHETHER OR NOT HCFC HAS BEEN ABLE TO LOCATE EACH PERSON ENTITLED TO SUCH SUBSCRIPTION RIGHTS.

Nontransferable subscription rights to purchase Common Shares are being issued at no cost to all eligible persons and entities in accordance with the preference categories established by the Plan, as described below. Each subscription right may be exercised only by the person to whom it is issued and only for his or her own account. Each person subscribing for shares must represent to HCFC that he or she is purchasing such shares for his or her own account and that he or she has no agreement or understanding with any other person for the sale or transfer of such shares.

The number of Common Shares which a person who has subscription rights may purchase will be determined, in part, by the total number of Common Shares to be issued and the availability of such shares for purchase under the preference categories set forth in the Plan and certain other limitations. See "Limitations on Purchases of Common Shares." The sale of any Common Shares pursuant to subscriptions received is contingent upon approval of the Plan by the Voting Members of Home City at the Special Meeting.

The preference categories for the allocation of Common Shares, which have been established by the Plan in accordance with applicable regulations, are as follows:

Category 1. Eligible Account Holders will receive, without payment, nontransferable subscription rights to purchase up to the greater of (i) the amount permitted to be purchased in the Community Offering, (ii) .10% of the total number of Common Shares sold in connection with the Conversion, or (iii) 15 times the product (rounded down to the next whole number) obtained by multiplying the total number of Common Shares sold in connection with the Conversion by a fraction of which the numerator is the amount of the Eligible Account Holder's Qualifying Deposit and the denominator of which is the total amount of Qualifying Deposits of all Eligible Account Holders, in each case on the Eligibility Record Date, subject to the overall purchase limitations set forth in Section 10 of the Plan. See "Limitations on Purchases of Common Shares."

If the exercise of subscription rights in this Category 1 results in an over-subscription, Common Shares will be allocated among subscribing Eligible Account Holders in a manner which will, to the extent possible, make the total allocation of each subscriber equal 100 shares or the amount subscribed for, whichever is less. Any Common Shares remaining after such allocation has been made will be allocated among the subscribing Eligible Account Holders whose subscriptions remain unfilled in the proportion which the amount of their respective Qualifying Deposits on the Eligibility Record Date bears to the total Qualifying Deposits of all subscribing Eligible Account Holders on such date. No fractional shares will be issued. The subscription rights of the Eligible Account Holders are subordinate to the limited priority right of the ESOP set forth in the following paragraph.

Category 2. The ESOP will receive, without payment, nontransferable subscription rights to purchase up to 10% of the Common Shares sold in connection with the Conversion. The subscription rights of the ESOP will be subordinate to the subscription rights in Category 1, except that if the final pro forma market value of Home City exceeds the maximum of the Valuation Range, the ESOP shall have first priority with respect to the amount sold in excess of the maximum of the Valuation Range. If the ESOP is unable to purchase all or part of the Common Shares for which it subscribes due to an oversubscription in Category 1, the ESOP may purchase Common Shares on the open market or may purchase authorized but unissued shares of HCFC. If the ESOP purchases authorized but unissued shares from HCFC, such purchases would have a dilutive effect on the interests of HCFC's shareholders.

-66-

Category 3. Supplemental Eligible Account Holders, will receive, without payment, non-transferable subscription rights to purchase up to the greater of (i) the amount permitted to be purchased in the Community Offering, (ii) .10% of the total number of Common Shares sold in connection with the Conversion, or (iii) 15 times the product (rounded down to the next whole number) obtained by multiplying the total number of Common Shares sold in connection with the Conversion by a fraction of which the numerator is the amount of the Supplemental Eligible Account Holder's Qualifying Deposit and the denominator of which is the total amount of Qualifying Deposits of all Supplemental Eligible Account Holders, in each case on the Supplemental Eligibility Record Date, subject to the overall purchase limitations set forth in
Section 10 of the Plan. See "Limitations on Purchases of Common Shares."

If the exercise of subscription rights in this Category 3 results in an over-subscription, Common Shares will be allocated among subscribing Supplemental Eligible Account Holders in a manner which will, to the extent possible, make the total allocation of each subscriber equal 100 shares or the amount subscribed for, whichever is lesser. Any Common Shares remaining after such allocation has been made will be allocated among the subscribing Supplemental Account Holders whose subscriptions remain unfilled in the proportion which the amount of their respective Qualifying Deposits on the Supplemental Eligibility Record Date bears to the total Qualifying Deposits of all subscribing Supplemental Eligible Account Holders on such date. No fractional shares will be issued.

Subscription rights received in this Category 3 will be subordinate to the subscription rights in Categories 1 and 2.

Category 4. All Voting Members who are not Eligible Account Holders or Supplemental Eligible Account Holders ("Other Eligible Members") will receive nontransferable subscription rights to purchase Common Shares in an amount up to the greater of the amount permitted to be purchased in the Community Offering or .10% of the total number of Common Shares sold in connection with the Conversion, subject to the overall purchase limitations set forth in Section 10 of the Plan. See "Limitations on Purchases of Common Shares." In the event of an oversubscription in this Category 4, the available shares will be allocated among subscribing Other Eligible Members on an equitable basis in the same proportion that their respective subscriptions bear to the total amount of all subscriptions in this Category 4.

Subscription rights received in this Category 4 will be subordinate to the subscription rights in Categories 1 through 3.

The Board of Directors may reject any one or more subscriptions if, based upon the Board of Directors' interpretation of applicable regulations, such subscriber is not entitled to the shares for which he or she has subscribed or if the sales of the shares subscribed for would be in violation of any applicable statutes, regulations or rules.

HCFC will make reasonable efforts to comply with the securities laws of all states in the United States in which persons having subscription rights reside. However, no such person will be offered or receive any Common Shares under the Plan who resides in a foreign country or in a state of the United States with respect to which all of the following apply: (i) a small number of persons otherwise eligible to subscribe for shares under the Plan resides in such country or state; (ii) under the securities laws of such country or state, the granting of subscription rights or the offer or sale of Common Shares to such persons would require HCFC or its officers or directors, to register as a broker or dealer or to register or otherwise qualify its securities for sale in such country or state; and (iii) such registration or qualification would be impracticable for reasons of cost or otherwise.

The term "resident" as used herein with respect to the Subscription Offering means any person who, on the date of submission of a stock order form, maintained a bona fide residence within a jurisdiction in which the Common Shares are being offered for sale. If a person is a business entity, the person's residence shall be the location of the principal place of business. If the person is a personal benefit plan, the residence of the beneficiary shall be the residence of the plan. In the case of all other benefit plans, the residence of the trustee shall be the residence of the plan. In all cases, the determination of a subscriber's residency shall be in the sole discretion of Home City and HCFC.

COMMUNITY OFFERING

Concurrently with the Subscription Offering, HCFC is hereby offering Common Shares in the Community Offering, subject to the limitations set forth below, to the extent such shares remain available after the satisfaction of all orders received in the Subscription Offering. If subscriptions are received in the Subscription Offering for at least 952,200 Common Shares, Common Shares may not be available for purchase in the Community Offering. All sales of Common Shares in the Community Offering will be at the same price per share as in the Subscription Offering. THE COMMUNITY OFFERING MAY BE TERMINATED AT

-67-

ANY TIME AFTER ORDERS FOR AT LEAST 952,200 COMMON SHARES HAVE BEEN RECEIVED, BUT IN NO EVENT LATER THAN ___________, 1996 (THE "COMMUNITY EXPIRATION DATE"), WITHOUT THE CONSENT OF THE OTS.

In the event shares are available in the Community Offering, members of the general public may purchase up to 1% of the Common Shares sold, which is 9,522 Common Shares at the maximum of the Valuation Range, as adjusted. See "Limitations on Purchases of Common Shares." If an insufficient number of shares is available to fill all of the orders received in the Community Offering, the available shares will be allocated in a manner to be determined by the Board of Directors of HCFC, subject to the following:

(i) Preference will be given to natural persons who are residents of Clark County, Ohio, the county in which the offices of Home City are located;

(ii) Orders received in the Community Offering will first be filled up to a maximum of 2% of the total number of Common Shares offered, with any remaining shares allocated on an equal number of shares per order basis until all orders have been filled;

(iii) No person, together with any Associate and persons Acting in Concert, may purchase more than 2% of the Common Shares; and

(iv) The right of any person to purchase Common Shares in the Community Offering is subject to the right of HCFC and Home City to accept or reject such purchases in whole or in part.

The term "resident" as used herein with respect to the Community Offering means any natural person who, on the date of submission of a stock order form, maintained a bona fide residence within, as appropriate, Clark County or a jurisdiction in which the Common Shares are being offered for sale.

LIMITATIONS ON PURCHASES OF COMMON SHARES

The Plan provides for certain additional limitations to be placed upon the purchase of Common Shares. To the extent such shares are available, the minimum number of shares that may be purchased by any party is 25. No fractional shares will be issued.

No person, together with Associates and persons Acting in Concert, may purchase more than 2% of the Common Shares. Subject to any required regulatory approval and the requirements of applicable laws and regulations, but without further approval of the members of Home City, purchase limitations may be increased or decreased at the sole discretion of the Boards of Directors of HCFC and Home City at any time. If such amount is increased, persons who subscribed for the maximum amount will be given the opportunity to increase their subscriptions up to the then applicable limit, subject to the rights and preferences of any person who has priority subscription rights. The Boards of Directors of HCFC and Home City may, in their sole discretion, increase the maximum purchase limitation referred to above up to 10%, provided that orders for shares exceeding 5% of the shares to be issued in the Conversion shall not exceed, in the aggregate, 10% of the shares to be issued in the Conversion. In the event that the purchase limitation is decreased after commencement of the Subscription Offering, the order of any person who subscribed for the maximum number of Common Shares shall be decreased by the minimum amount necessary so that such person shall be in compliance with the then maximum number of shares permitted to be subscribed for by such person.

"Acting in Concert" is defined as "knowing participation in a joint activity or independent conscious parallel action towards a common goal" or "a combination or pooling of voting or other interests in the securities of an issuer for a common purpose." Persons shall be presumed to be Acting in Concert with each other if: (i) both are purchasing Common Shares in the Conversion and are (a) executive officers, directors, trustees, or any one who performs, or whose nominee or representative performs, a similar policy making function at a company (other than Home City or HCFC) or principal business units or subsidiaries of a company, or (b) any person who directly or indirectly owns or controls 10% or more of the stock of a company (other than Home City or HCFC); or (ii) one person provides credit to the other for the purchase of Common Shares or is instrumental in obtaining that credit. In addition, if a person is presumed to be Acting in Concert with another person, then the person is presumed to Act in Concert with anyone else who is, or is presumed to be, Acting in Concert with that other person.

For purposes of the Plan, (i) the directors of Home City are not deemed to be Acting in Concert solely by reason of their membership on the Board of Directors of Home City; (ii) an associate of a person (an "Associate") is (a) any corporation or

-68-

organization (other than Home City) of which such person is an officer, partner or, directly or indirectly, the beneficial owner of 10% or more of any class of equity securities; (b) any trust or other estate in which such person has a substantial beneficial interest or as to which such person serves as trustee or in a similar fiduciary capacity; and (c) any relative or spouse of such person, or relative of such spouse, who either has the same home as such person or who is a director or officer of Home City. Executive officers and directors of Home City and their Associates may not purchase, in the aggregate, more than 34.9% of the total number of Common Shares sold in the Conversion. Shares acquired by the ESOP will not, pursuant to regulations governing the Conversion, be aggregated with the shares purchased by the directors, officers and employees of Home City.

Purchases of Common Shares are also subject to the change in control regulations of the OTS. Such regulations restrict direct and indirect purchases of 10% or more of the stock of any savings association by any person or group of persons Acting in Concert. See "RESTRICTIONS ON ACQUISITION OF HOME CITY AND HCFC AND RELATED ANTI-TAKEOVER PROVISIONS - Federal Law and Regulation."

After the Conversion, Common Shares, except for shares purchased by officers and directors of HCFC, will be freely transferable, subject to OTS regulations. See "Restrictions on Transferability of Common Shares by Directors and Officers."

PLAN OF DISTRIBUTION

The offering of the Common Shares is made only pursuant to this Prospectus, which is available to all eligible subscribers by mail. See "ADDITIONAL INFORMATION." Additional copies are available at the offices of Home City. Sales of Common Shares will be made primarily by registered representatives affiliated with Webb. HCFC will rely on Rule 3a4-1 under the Exchange Act, and sales of Common Shares will be conducted within the requirements of Rule 3a4-1, which will permit officers, directors and employees of HCFC and Home City to participate in the sale of Common Shares, in clerical capacities, providing administrative support in effecting sales transactions or answering questions relating to the proper execution of the Stock Order Form, except that officers, directors and employees will not participate in the sale of Common Shares to residents of any state in which such persons have not met such state's requirements for participation. Management of Home City may answer questions regarding the business of Home City. Other questions of prospective purchasers, including questions as to the nature of the investment, will be directed to registered representatives. Management and the employees of Home City have been instructed not to solicit offers to purchase Common Shares or to provide advice regarding the purchase of Common Shares. No officer, director or employee of HCFC or Home City will be compensated in connection with his participation by the payment of commissions or other remuneration based either directly or indirectly on the transactions in the Common Shares.

To assist HCFC in marketing the Common Shares, HCFC has retained Webb, which are broker-dealers registered with the SEC and members of the National Association of Securities Dealers, Inc. (the "NASD"). Webb will consult with and advise HCFC and assist with the sale of the Common Shares on a best efforts basis in connection with the Conversion. The services to be rendered by Webb include assisting HCFC in conducting the Subscription Offering and the Community Offering and educating Home City personnel about the Conversion process. Webb is not obligated to purchase any of the Common Shares.

For its services, Webb has been paid a management fee in the amount of $25,000. Webb will also receive a commission equal to 1.5% of the aggregate purchase price paid for Common Shares sold in the Conversion, excluding purchases by Home City's directors, executive officers, and Associates of such directors and executive officers, and the ESOP. If Webb and HCFC deem necessary, Webb may enter into agreements with other NASD members ("Selected Dealers") for assistance in the sale of the Common Shares, in which event Webb and such Selected Dealers will receive a commission not to exceed 5.5% of the purchase price of Common Shares sold, if any, by the Selected Dealer. In addition, HCFC will reimburse Webb for certain expenses, including reasonable legal fees. Webb is not obligated to purchase any Common Shares.

HCFC and Home City have agreed to indemnify Webb and its directors, officers, employees, agents and any controlling person against any and all loss, liability, claim, damage or expense arising out of any untrue statement, or alleged untrue statement, of a material fact contained in the Summary Proxy Statement or the Prospectus, any application to regulatory authorities, any "blue sky" application, or any other related document prepared or executed by or on behalf of HCFC or Home City with its consent in connection with, or in contemplation of, the Conversion, or any omission therefrom of a material fact required to be stated therein, unless such untrue statement or omission, or alleged untrue statement or omission, was made in reliance upon certain information furnished to Home City by Webb expressly for use in the Summary Proxy Statement or the Prospectus.

-69-

The Common Shares will be offered principally by the distribution of this Prospectus and through activities conducted at the Conversion Information Center, which will be located at the office of Home City. The Conversion Information Center will be staffed by one or more of Webb's employees, who will be responsible for mailing materials relating to the Offering, responding to questions regarding the Conversion and the Offering and processing stock orders.

A conspicuous legend that the Common Shares are not a federally-insured or guaranteed deposit or account appears on all offering documents used in connection with the Conversion and will appear on the certificates representing the Common Shares. Any person purchasing Common Shares will be required to execute the Stock Order Form certifying such person's knowledge that the Common Shares are not federally-insured or guaranteed and that the purchaser has received a Prospectus and understands the investment risk involved.

EFFECT OF EXTENSION OF COMMUNITY OFFERING

If the Community Offering extends beyond 45 days after the Subscription Expiration Date, persons who have subscribed for Common Shares in the Subscription Offering or in the Community Offering will receive a written notice that until a date specified in the notice, they have the right to increase, decrease or rescind their subscriptions for Common Shares. Any person who does not affirmatively elect to continue his subscription or elects to rescind his subscription during any such extension will have all of his funds promptly refunded with interest. Any person who elects to decrease his subscription during any such extension shall have the appropriate portion of his funds promptly refunded with interest.

USE OF STOCK ORDER FORMS

Subscriptions for Common Shares in the Subscription Offering and the Community Offering may be made only by completing and submitting a Stock Order Form. Any person who desires to subscribe for Common Shares in the Subscription Offering must do so by delivering to HCFC at 63 West Main Street, Springfield, Ohio 45502-1309, by mail or in person, prior to 4:00 p.m., Eastern Time, on _________, 1996, a properly executed and completed original Stock Order Form, together with full payment of the subscription price of $10 for each share for which subscription is made. Photocopies or telecopies of Stock Order Forms will not be accepted. See "ADDITIONAL INFORMATION." THE FAILURE TO DELIVER A PROPERLY EXECUTED ORIGINAL ORDER FORM AND FULL PAYMENT IN A MANNER BY WHICH THEY ARE ACTUALLY RECEIVED BY HCFC NO LATER THAN 4:00 P.M. ON THE SUBSCRIPTION EXPIRATION DATE WILL PRECLUDE THE PURCHASE OF COMMON SHARES IN THE OFFERING.

AN EXECUTED STOCK ORDER FORM, ONCE RECEIVED BY HCFC, MAY NOT BE MODIFIED, AMENDED OR RESCINDED WITHOUT THE CONSENT OF HCFC, UNLESS (I) THE COMMUNITY OFFERING IS NOT COMPLETED WITHIN 45 DAYS AFTER THE SUBSCRIPTION EXPIRATION DATE, OR (II) THE FINAL VALUATION OF HOME CITY, AS CONVERTED, IS LESS THAN $6,120,000 OR MORE THAN $9,522,000. IF EITHER OF THOSE EVENTS OCCUR, PERSONS WHO HAVE SUBSCRIBED FOR COMMON SHARES IN THE SUBSCRIPTION OFFERING OR IN THE COMMUNITY OFFERING WILL RECEIVE WRITTEN NOTICE THAT UNTIL A DATE SPECIFIED IN THE NOTICE, THEY HAVE A RIGHT TO AFFIRM, INCREASE, DECREASE OR RESCIND THEIR SUBSCRIPTIONS. ANY PERSON WHO DOES NOT AFFIRMATIVELY ELECT TO CONTINUE HIS SUBSCRIPTION OR ELECTS TO RESCIND HIS SUBSCRIPTION DURING ANY SUCH EXTENSION WILL HAVE ALL OF HIS FUNDS PROMPTLY REFUNDED WITH INTEREST. ANY PERSON WHO ELECTS TO DECREASE HIS SUBSCRIPTION DURING ANY SUCH EXTENSION WILL HAVE THE APPROPRIATE PORTION OF HIS FUNDS PROMPTLY REFUNDED WITH INTEREST.

PAYMENT FOR COMMON SHARES

Payment of the subscription price for all Common Shares for which subscription is made must accompany all completed Stock Order Form in order for subscriptions to be valid. Payment for Common Shares may be made (i) in cash, if delivered in person, (ii) by check, bank draft or money order payable to the order of Home City, or (iii) by authorization of withdrawal from savings accounts in Home City (other than non-self-directed IRAs). Wire transfers will not be accepted. Home City cannot lend money or otherwise extend credit to any person to purchase Common Shares, other than the ESOP.

Payments made in cash or by check, bank draft or money order will be placed in a segregated savings account insured by the FDIC up to applicable limits. Interest will be paid by Home City on such accounts at Home City's passbook rate, currently ____% annual percentage yield, from the date payment is received until the Conversion is completed or terminated. Payments made by check will not be deemed to have been received until such check has cleared for payment.

Instructions for authorizing withdrawals from savings accounts are provided in the Stock Order Form. Once a withdrawal has been authorized, none of the designated withdrawal amount may be used by a subscriber for any purpose other

-70-

than to purchase Common Shares, unless the Conversion is terminated. All sums authorized for withdrawal will continue to earn interest at the contract rate for such account or certificate until the completion or termination of the Conversion. Interest penalties for early withdrawal applicable to certificate accounts will be waived in the case of withdrawals authorized for the purchase of Common Shares. If a partial withdrawal from a certificate account results in a balance less than the applicable minimum balance requirement, the certificate will be cancelled and the remaining balance will earn interest at Home City's passbook rate subsequent to the withdrawal.

Persons who are beneficial owners of IRAs maintained at Home City do not personally have subscription rights related to such account. The account itself, however, may have subscription rights. In order to utilize funds in an IRA maintained at Home City, the funds must be transferred to a self-directed IRA that permits the IRA funds to be invested in stock. The beneficial owner of the IRA must direct the trustee of the IRA to use funds from such account to purchase Common Shares in connection with the Conversion. Persons who are interested in utilizing IRAs at Home City to subscribe for Common Shares should contact the Home City Conversion Center at (513) 324-3830 for instructions and assistance.

Subscriptions will not be filled by HCFC until subscriptions have been received in the Subscription Offering and the Community Offering for up to 612,000 Common Shares, the minimum point of the Valuation Range. If the Conversion is terminated, all funds delivered to HCFC for the purchase of Common Shares will be returned with interest, and all charges to savings accounts will be rescinded. Subscribers and other purchasers will be notified by mail, promptly on completion of the sale of the Common Shares, of the number of shares for which their subscriptions have been accepted. Certificates representing Common Shares will be delivered promptly thereafter.

If the ESOP subscribes for Common Shares in the Subscription Offering, the ESOP will not be required to pay for the shares subscribed for at the time it subscribes but may pay for such Common Shares upon consummation of the Conversion.

SHARES TO BE PURCHASED BY MANAGEMENT PURSUANT TO SUBSCRIPTION RIGHTS

The following table sets forth certain information regarding the subscription rights intended to be exercised by the directors and executive officers of Home City and their Associates. For purposes of this table, it has been assumed that 720,000 Common Shares will be sold in connection with the Conversion at $10 per share and that a sufficient number of Common Shares will be available to satisfy the intended purchases by directors and executive officers. The number of Common Shares purchased may decrease or increase if fewer or greater than 720,000 Common Shares are sold in connection with the Conversion. See "Pricing and Number of Common Shares to be Sold."

                                                                  Percent          Aggregate
                                                 Total            of total          purchase
Name                                            shares            offering            price
- ----                                            ------            --------         ---------

John D. Conroy                                   14,400             2.0%            $144,000
P. Clark Engelmeier                              14,400             2.0              144,000
James Foreman                                    14,400             2.0              144,000
Terry A. Hoppes                                  14,400             2.0              144,000
Douglas L. Ulery                                 14,400             2.0              144,000
Gary E. Brown                                     2,000             0.3               20,000
JoAnn Holdeman                                    1,000             0.1               10,000
                                                -------           -----           ----------

   Total                                         75,000            10.4%            $750,000
                                                 ======            ====             ========

All purchases by executive officers and directors of Home City are made for investment purposes only and with no intent to resell.

PRICING AND NUMBER OF COMMON SHARES TO BE SOLD

The aggregate offering price of the Common Shares will be based on the pro forma market value of the shares as determined by an independent appraisal of Home City. Keller, a firm which evaluates and appraises financial institutions, was retained by Home City to prepare an appraisal of the estimated pro forma market value of Home City as converted. Keller will receive a fee of $15,000 for its appraisal, which amount includes out-of-pocket expenses.

-71-

The appraisal was prepared by Keller in reliance upon the information contained herein. Keller also considered the following factors, among others:
the present and projected operating results and financial condition of Home City and the economic and demographic conditions in Home City's existing market area; the quality and depth of Home City's management and personnel; certain historical financial and other information relating to Home City and a comparative evaluation of the operating and financial statistics of Home City with those of other thrift institutions; the aggregate size of the offering; the impact of the Conversion on Home City's regulatory capital and earnings potential; the trading market for stock of comparable thrift institutions; the effect of Home City becoming a subsidiary of HCFC; and general conditions in the markets for such stocks.

Keller's valuation of the estimated pro forma market value of Home City, as converted, is $7,200,000 as of September 6, 1996 (the "Pro Forma Value"). HCFC will issue the Common Shares at a fixed price of $10 per share and, by dividing the price per share into the Pro Forma Value, will determine the number of shares to be issued. Applicable regulations also require, however, that the appraiser establish the Valuation Range of 15% on either side of the Pro Forma Value to allow for fluctuations in the aggregate value of the Common Shares due to changes in the market for thrift shares and other factors from the time of commencement of the Subscription Offering until the completion of the Conversion.

As of September 6, 1996, the Valuation Range was from $6,120,000 to $8,280,000, which, based upon a per share offering price of $10, will result in the sale of between 612,000 and 828,000 Common Shares. In the event that Keller determines at the close of the Conversion that the aggregate pro forma value of Home City is higher or lower than the Pro Forma Value, but is nevertheless within the Valuation Range, or is not more than 15% above the maximum point of the Valuation Range, HCFC will make an appropriate adjustment by raising or lowering the total number of Common Shares sold in the Conversion consistent with the final Valuation Range. The total number of Common Shares sold in the Conversion will be determined in the discretion of the Board of Directors consistent with the Valuation Range. If, due to changing market conditions, the final valuation is not between the minimum of the Valuation Range and 15% above the maximum of the Valuation Range, subscribers will be given a notice of such final valuation and the right to affirm, increase, decrease or rescind their subscriptions. Any person who does not affirmatively elect to continue his subscription or elects to rescind his subscription before the date specified in the notice will have all of his funds promptly refunded with interest. Any person who elects to decrease his subscription will have the appropriate portion of his funds promptly refunded with interest.

THE APPRAISAL BY KELLER IS NOT INTENDED, AND MUST NOT BE CONSTRUED, AS A RECOMMENDATION OF ANY KIND AS TO THE ADVISABILITY OF PURCHASING COMMON SHARES OR VOTING TO APPROVE THE CONVERSION. IN PREPARING THE VALUATION, KELLER HAS RELIED UPON AND ASSUMED THE ACCURACY AND COMPLETENESS OF FINANCIAL AND STATISTICAL INFORMATION PROVIDED BY HOME CITY AND ITS INDEPENDENT AUDITORS. KELLER DID NOT INDEPENDENTLY VERIFY THE FINANCIAL STATEMENTS AND OTHER INFORMATION PROVIDED BY HOME CITY AND ITS INDEPENDENT AUDITORS, NOR DID KELLER VALUE INDEPENDENTLY THE ASSETS OR LIABILITIES OF HOME CITY OR HCFC. THE VALUATION CONSIDERS HOME CITY ONLY AS A GOING CONCERN AND SHOULD NOT BE CONSIDERED AS AN INDICATION OF THE LIQUIDATION VALUE OF HOME CITY. MOREOVER, BECAUSE SUCH VALUATION IS NECESSARILY BASED UPON ESTIMATES AND PROJECTIONS OF A NUMBER OF MATTERS, ALL OF WHICH ARE SUBJECT TO CHANGE FROM TIME TO TIME, NO ASSURANCE CAN BE GIVEN THAT PERSONS PURCHASING COMMON SHARES WILL THEREAFTER BE ABLE TO SELL SUCH SHARES AT PRICES WITHIN THE ESTIMATED PRICE RANGE.

A copy of the complete appraisal is on file and open for inspection at the offices of the OTS, 1700 G Street, N.W., Washington, D.C. 20552, at the Central Regional Office of the OTS, 200 West Madison, Suite 1300, Chicago, Illinois 60606, and at each of the offices of Home City.

RESTRICTION ON REPURCHASE OF COMMON SHARES

Federal regulations prohibit HCFC from repurchasing, without approval by the OTS, any of its capital stock for three years following the date of completion of the Conversion, except as part of an open-market stock repurchase program during the second and third years following the Conversion involving no more than 5% of HCFC's outstanding capital stock during a twelve-month period. In addition, after such a repurchase, Home City's regulatory capital must equal or exceed all regulatory capital requirements. Before commencement of such a program, HCFC must provide notice to the OTS, and the OTS may disapprove the program if the OTS determines that it would adversely affect the financial condition of Home City or if it determines that there is no valid business purpose for such repurchase. Such repurchase restrictions would not prohibit the ESOP or the RRP from purchasing Common Shares during the first year following Conversion.

-72-

RESTRICTIONS ON TRANSFERABILITY OF COMMON SHARES BY DIRECTORS AND OFFICERS

Common Shares purchased by directors or executive officers of HCFC or their Associates will be subject to the restriction that such shares may not be sold for a period of one year following completion of the Conversion, except in the event of the death of the shareholder. The certificates evidencing Common Shares issued by HCFC to directors, executive officers and their Associates will bear a legend giving appropriate notice of the restriction imposed upon the transfer of such Common Shares. In addition, HCFC will give appropriate instructions to the transfer agent (if any) for HCFC's Common Shares in respect of the applicable restriction for transfer of any restricted shares. Any shares issued as a stock dividend, stock split or otherwise in respect of restricted shares will be subject to the same restrictions.

Subject to certain exceptions, for a period of three years following the Conversion, no director or officer of HCFC or Home City, or any of their Associates, may purchase any common shares of HCFC without the prior written approval of the OTS, except through a broker-dealer registered with the SEC. This restriction will not apply, however, to negotiated transactions involving more than 1% of a class of outstanding common shares of HCFC or shares acquired by any stock benefit plan of Home City or HCFC.

The Common Shares, like the stock of most public companies, are subject to the registration requirements of the Securities Act. Accordingly, the Common Shares may be offered and sold only in compliance with such registration requirements or pursuant to an applicable exemption from registration. Common Shares received in the Conversion by persons who are not "affiliates" of HCFC may be resold without registration. Common Shares received by affiliates of HCFC will be subject to resale restrictions. An "affiliate" of HCFC, for purposes of Rule 144, is a person who directly, or indirectly through one or more intermediaries, controls, or is controlled by or is under common control with, HCFC. Rule 144 generally requires that there be publicly available certain information concerning HCFC and that sales subject to Rule 144 be made in routine brokerage transactions or through a market maker. If the conditions of Rule 144 are satisfied, each affiliate (or group of persons acting in concert with one or more affiliates) is entitled to sell in the public market, without registration, in any three-month period, a number of shares which does not exceed the greater of (i) 1% of the number of outstanding shares of HCFC or (ii) if the shares are admitted to trading on a national securities exchange or reported through the automated quotation system of a registered securities association, the average weekly reported volume of trading during the four weeks preceding the sale.

RIGHTS OF REVIEW

Any person aggrieved by a final action of the OTS which approves, with or without conditions, or disapproves the Plan may obtain review of such action by filing in the Court of Appeals of the United States for the circuit in which the principal office or residence of such person is located or in the United States Court of Appeals for the District of Columbia, a written petition praying that the final action of the OTS be modified, terminated or set aside. Such petition must be filed within 30 days after the date of mailing of proxy materials to the Voting Members of Home City or within 30 days after the date of publication in the Federal Register of notice of approval of the Plan by the OTS, whichever is later.

RESTRICTIONS ON ACQUISITION OF HOME CITY AND HCFC
AND RELATED ANTI-TAKEOVER PROVISIONS

GENERAL

Federal law and regulation, Ohio law, the Articles of Incorporation and Code of Regulations of HCFC, the Amended Charter of Home City and certain employee benefit plans to be adopted by Home City and HCFC contain certain provisions which may deter or prohibit a change of control of Home City or HCFC. Such provisions are intended to encourage any acquiror to negotiate the terms of an acquisition with the Board of Directors of HCFC, thereby reducing the vulnerability of HCFC to takeover attempts and certain other transactions which have not been negotiated with and approved by the Board of Directors.

Anti-takeover devices and provisions may have the effect, however, of discouraging sudden or hostile takeover attempts, even under circumstances in which shareholders may deem such takeovers to be in their best interests or in which shareholders may receive a substantial premium for their shares over then current market prices. As a result, shareholders who might desire to participate in such a transaction may not have an opportunity to participate because of such devices and provisions. Moreover, such devices and provisions may also benefit management by discouraging changes of control in which incumbent management would be removed from office.

-73-

The following is a summary of certain provisions of such laws, regulations and documents.

FEDERAL LAW AND REGULATION

FEDERAL DEPOSIT INSURANCE ACT. The FDIA provides that no person, acting directly or indirectly or in concert with one or more persons, may acquire control of any insured savings association or holding company unless both (i) 60 days' prior written notice has been given to the OTS and (ii) the OTS has not issued a notice disapproving the proposed acquisition. Control, for purposes of the FDIA, means the power, directly or indirectly, to direct the management or policies of an insured institution or to vote 25% or more of any class of securities of such institution. This provision of the FDIA is implemented by the OTS in accordance with the Regulations for Acquisition of Control of an Insured Institution, 12 C.F.R. Part 574 (the "Control Regulations"). Control, for purposes of the Control Regulations, exists in situations in which either (a) the acquiring party has direct or indirect voting control of at least 25% of the institution's voting shares or controls in any manner the election of a majority of the directors of such institution or (b) the Director of the OTS determines that such person exercises a controlling influence over the management or policies of such institution. In addition, control is presumed to exist, subject to rebuttal, if the acquiring party (which includes a group "acting in concert") has voting control of at least 10% of the institution's voting stock and any of eight control factors specified in the Control Regulations exists. There are also rebuttable presumptions in the Control Regulations concerning whether a group "acting in concert" exists, including presumed action in concert among members of an "immediate family." The Control Regulations apply to acquisitions of Common Shares in connection with the Conversion and to acquisitions after the Conversion.

CHANGE IN CONTROL OF CONVERTED ASSOCIATIONS. A regulation of the OTS provides that, for a period of three years after the date of the completion of the Conversion, no person shall, directly or indirectly, offer to acquire or acquire beneficial ownership of more than 10% of any class of equity security of Home City or HCFC without the prior written approval of the OTS. In addition to the actual ownership of more than 10% of a class of equity securities, a person is deemed to have acquired beneficial ownership of more than 10% of the equity securities of HCFC or Home City if the person holds any combination of stock and revocable and/or irrevocable proxies of HCFC under circumstances that give rise to a conclusive control determination or rebuttable control determination under the OTS's change of control regulations. Such circumstances include (i) holding any combination of voting shares and revocable and/or irrevocable proxies representing more than 25% of any class of voting stock of HCFC enabling the acquirer (a) to elect one-third or more of the directors, (b) to cause HCFC's or Home City's shareholders to approve the acquisition or corporate reorganization of HCFC or Home City, or (c) to exert a controlling influence over a material aspect of the business operations of HCFC or Home City, and (ii) acquiring any combination of voting shares and irrevocable proxies representing more than 25% of any class of voting shares.

Such three-year restriction does not apply (i) to any offer with a view toward public resale made exclusively to Home City or HCFC or to any underwriter or selling group acting on behalf of Home City or HCFC, (ii) unless made applicable by the OTS by prior written advice, to any offer or announcement of an offer which, if consummated, would result in the acquisition by any person, together with all other acquisitions by any such person of the same class of securities during the preceding 12-month period, of not more than 1% of the class of securities, or (iii) to any offer to acquire or the acquisition of beneficial ownership of more than 10% of any class of equity security of Home City or HCFC by a corporation whose ownership is or will be substantially the same as the ownership of Home City or HCFC if made more than one year following the date of the Conversion. The foregoing restriction does not apply to the acquisition of Home City or HCFC's capital stock by one or more tax-qualified employee stock benefit plans of HCFC or Home City, provided that the plan or plans do not have beneficial ownership in the aggregate of more than 25% of any class of equity security of Home City or HCFC. See "Articles of Incorporation of Home City" for a discussion of a five-year restriction on direct or indirect beneficial ownership of 10% of the outstanding common stock of Home City.

HOLDING COMPANY RESTRICTIONS. Federal law generally prohibits a savings and loan holding company, without prior approval of the Director of the OTS, from (i) acquiring control of any other savings association or savings and loan holding company, (ii) acquiring substantially all of the assets of a savings association or holding company thereof, or (iii) acquiring or retaining more than 5% of the voting shares of a savings association or holding company thereof which is not a subsidiary. Acquisitions under the Holding Company Act are governed by the Control Regulations. See "Federal Deposit Insurance Act."

Under certain circumstances, a savings and loan holding company is permitted to acquire, with the approval of the Director of the OTS, up to 15% of the previously unissued voting shares of an undercapitalized savings association for cash without such savings association being deemed to be controlled by the holding company. Except with the prior approval of the Director of the OTS, no director or officer of a savings and loan holding company or person owning or controlling by proxy or

-74-

otherwise more than 25% of such company's voting shares may acquire control of any savings institution, other than a subsidiary institution or any other savings and loan holding company.

OHIO LAW

MERGER MORATORIUM STATUTE. Ohio has adopted a merger moratorium statute regulating certain takeover bids affecting certain public corporations with significant ties to Ohio. The statute prohibits, with some exceptions, any merger, combination or consolidation and any of certain other sales, leases, distributions, dividends, exchanges, mortgages or transfers between such an Ohio corporation and any person who has the right to exercise, alone or with others, 10% or more of the voting power of such corporation (an "Interested Shareholder"), for three years following the date on which such person first becomes an Interested Shareholder. Such a business combination is permitted only if, prior to the time such person first becomes an Interested Shareholder, the Board of Directors of the issuing corporation has approved the purchase of shares that resulted in such person first becoming an Interested Shareholder.

After the initial three-year moratorium, such a business combination may not occur unless (1) an exception specifically enumerated in the statute is applicable to the combination, (2) the combination is approved, at a meeting held for such purpose, by the affirmative vote of the holders of the issuing public corporation entitling them to exercise at least two-thirds of the voting power of the issuing public corporation in the election of directors or of such different proportion as the articles may provide, provided the combination is also approved by the affirmative vote of the holders of at least a majority of the disinterested shares, or (3) the business combination meets certain statutory criteria designed to ensure that the issuing public corporation's remaining shareholders receive fair consideration for their shares.

An Ohio corporation may, under certain circumstances, "opt out" of the statute by specifically providing in its articles of incorporation that the statute does not apply to any business combination of such corporation. However, the statute still prohibits for twelve months any business combination that would have been prohibited but for the adoption of such an opt-out amendment. The statute also provides that it will continue to apply to any business combination between a person who became an Interested Shareholder prior to the adoption of such an amendment as if the amendment had not been adopted. The Articles of Incorporation of HCFC do not opt out of the protection afforded by Chapter 1704. Therefore, the merger moratorium statute applies to HCFC.

CONTROL SHARE ACQUISITION STATUTE. Section 1701.831 of the Ohio Revised Code (the "Control Share Acquisition Statute") requires that certain acquisitions of voting securities that would result in the acquiring shareholder owning 20%, 33 1/3%, or 50% of the outstanding voting securities of HCFC must be approved in advance by the holders of at least a majority of the outstanding voting shares represented at a meeting at which a quorum is present and a majority of the portion of the outstanding voting shares represented at such a meeting, excluding the voting shares owned by the acquiring shareholder. The Control Share Acquisition Statute was intended, in part, to protect shareholders of Ohio corporations from coercive tender offers.

TAKEOVER BID STATUTE. Ohio law also contains a statute regulating takeover bids for any Ohio corporation. Such statute provides that no offeror may make a takeover bid unless (i) at least 20 days prior thereto the offeror announces publicly the terms of the proposed takeover bid and files with the Ohio Division of Securities (the "Securities Division") and provides the target company with certain information in respect of the offeror, his ownership of the company's shares and his plans for the company, and (ii) within ten days following such filing either (a) no hearing is required by the Securities Division, (b) a hearing is requested by the target company within such time but the Securities Division finds no cause for hearing exists, or (c) a hearing is ordered and upon such hearing the Securities Division adjudicates that the offeror proposes to make full, fair and effective disclosure to offerees of all information material to a decision to accept or reject the offer.

The takeover bid statute also states that no offeror shall make a takeover bid if he owns 5% or more of the issued and outstanding equity securities of any class of the target company, any of which were purchased within one year before the proposed takeover bid, and the offeror, before making any such purchase, failed to announce his intention to gain control of the target company or otherwise failed to make full and fair disclosure of such intention to the persons from whom he acquired such securities. The United States District Court for the Southern District of Ohio has determined that the Ohio takeover bid statute is preempted by federal regulation.

ARTICLES OF INCORPORATION OF HCFC

RESTRICTION ON ACQUISITION OF MORE THAN 10% OF THE COMMON SHARES. The Articles of Incorporation of HCFC provide that for five years after the effective date of the Conversion, no person, except the ESOP, may offer to acquire or acquire

-75-

the beneficial ownership of more than 10% of any class of outstanding equity securities of HCFC. If such a prohibited acquisition occurs, the securities owned by such person in excess of the 10% limit may not be voted on any matter submitted to the shareholders of HCFC. The term "person" is defined as an individual, a group acting in concert, a corporation, a partnership, an association, a joint stock company, a trust, an unincorporated organization or similar company, a syndicate or any other group formed for the purpose of acquiring, holding or disposing of the equity securities of HCFC, but does not include an employee stock ownership plan for the benefit of the employees of Home City or HCFC. The term "offer" includes every offer to buy or otherwise acquire, solicitation of an offer to sell, tender offer for, or request or invitation for tenders of HCFC's Common Shares. The ability of management or any other person to solicit revocable proxies from shareholders will not be restricted by such 10% limit.

ABILITY OF THE BOARD OF DIRECTORS TO ISSUE ADDITIONAL SHARES. The Articles of Incorporation of HCFC permit the Board of Directors of HCFC to issue additional common shares and preferred shares. See "DESCRIPTION OF AUTHORIZED SHARES - General." The ability of the Board of Directors to issue such additional shares may create impediments to gaining, or otherwise discourage persons from attempting to gain, control of HCFC.

MATTERS REQUIRING ENLARGED SHAREHOLDER VOTE. Generally, matters requiring a vote of the shareholders of HCFC may be approved by the holders of a majority of the voting shares of HCFC. Article Sixth of the Articles of Incorporation of HCFC provides, however, that, in the event the Board of Directors recommends against the approval of any of the following matters, the holders of at least 75% of the voting shares of HCFC are required to adopt any such matters.

(1) A proposed amendment to the Articles of Incorporation of HCFC;

(2) A proposed amendment to the Code of Regulations of HCFC;

(3) A proposal to change the number of directors by action of the shareholders;

(4) An agreement of merger or consolidation providing for the proposed merger or consolidation of HCFC with or into one or more other corporations;

(5) A proposed combination or majority share acquisition involving the issuance of shares of HCFC and requiring shareholder approval;

(6) A proposal to sell, exchange, transfer or otherwise dispose of all, or substantially all, of the assets, with or without the goodwill of HCFC; or

(7) A proposed dissolution of HCFC.

Officers and directors of HCFC are expected to purchase approximately 10.4% of the Common Shares at the mid-point of the Valuation Range. In addition, the ESOP intends to purchase approximately 8% of the Common Shares, and it is anticipated that upon shareholder approval of the RRP, the RRP will purchase 4% of the outstanding Common Shares. The ESOP trustee must vote shares allocated under the ESOP as directed by the participants to whom the shares are allocated and vote unallocated shares in his sole discretion on mergers, sales of substantially all of HCFC's assets and similar transactions. The RRP trustees, who are expected to be two directors of HCFC, will vote shares held by the RRP Trust in their discretion. Thus, officers and directors will have a significant influence over the vote on such a transaction and may be able to defeat such a proposal.

ELIMINATION OF CUMULATIVE VOTING. Section 1701.55 of the Ohio Revised Code provides in substance and effect that shareholders of a for profit corporation which is not a savings and loan association and which is incorporated under Ohio law must initially be granted the right to cumulate votes in the election of directors. The right to cumulate votes in the election of directors will exist at a meeting of shareholders if notice in writing is given by any shareholder to the President, a Vice President or the Secretary of an Ohio corporation, not less than 48 hours before a meeting at which directors are to be elected, that the shareholder desires that the voting for the election of directors shall be cumulative and if an announcement of the giving of such notice is made upon the convening of such meeting by the Chairman or Secretary or by or on behalf of the shareholder giving such notice. If cumulative voting is invoked, each shareholder would have a number of votes equal to the number of directors to be elected, multiplied by the number of shares owned by him, and would be entitled to distribute his votes among the candidates as he sees fit.

-76-

Section 1701.69 of the Ohio Revised Code provides that an Ohio corporation may eliminate cumulative voting in the election of directors after the expiration of 90 days after the date of initial incorporation by filing with the Ohio Secretary of State an amendment to the articles of incorporation eliminating cumulative voting. The Articles of Incorporation of HCFC have been amended to eliminate cumulative voting. The elimination of cumulative voting may make it more difficult for shareholders to elect as directors persons whose election is not supported by the Board of Directors.

FEDERAL STOCK CHARTER OF HOME CITY

For a five-year period following the date of the completion of the Conversion, no person may, directly or indirectly, acquire or offer to acquire the beneficial ownership of more than 10% of Home City's outstanding common shares. The acquisition of more than 10% of the Common Shares of HCFC would constitute an indirect acquisition of the common shares of Home City and would, therefore, be prohibited by the Federal Stock Charter of Home City. The beneficial ownership limitation prohibition does not apply, however, to purchases of Home City's common shares by one or more tax-qualified employee stock benefit plans of Home City. Any holder of shares of HCFC or Home City beneficially owned in violation of such prohibition will not be entitled to vote on matters submitted to a vote of shareholders, and such shares shall not be voted by any person or be counted as voting shares in connection with any matter submitted to shareholders for a vote. The term "person" includes an individual, a group acting in concert, a corporation, a partnership, an association, a joint stock company, a trust, an unincorporated organization or similar company, a syndicate or any other group formed for the purpose of acquiring, holding or disposing of the equity securities of HCFC or Home City. The term "offer" includes every offer to buy or otherwise acquire, solicitation of an offer to sell, tender offer for, or request or invitation for tenders of HCFC's Common Shares or Home City's common shares.

EMPLOYEE BENEFIT PLANS

Adoption of the ESOP may also have an anti-takeover effect. The ESOP may become the owner of a sufficient percentage of the total outstanding Common Shares that the decision whether to tender the shares held by the ESOP to a potential acquirer may prevent a takeover. See "DESCRIPTION OF AUTHORIZED SHARES" and "MANAGEMENT OF HOME CITY - Employee Stock Ownership Plan."

DESCRIPTION OF AUTHORIZED SHARES

GENERAL

The Articles of Incorporation of HCFC authorize the issuance of five million common shares and one million preferred shares. The common shares and the preferred shares authorized by HCFC's Articles of Incorporation have no par value. Upon receipt by HCFC of the purchase price therefor and subsequent issuance thereof, each Common Share will be fully paid and nonassessable. The Common Shares of HCFC will represent nonwithdrawable capital and will not and cannot be insured by the FDIC. Each Common Share will have the same relative rights and will be identical in all respects to every other Common Share.

None of the preferred shares of HCFC will be issued in connection with the Conversion. The Board of Directors of HCFC is authorized, without shareholder approval, to issue preferred shares and to fix and state the designations, preferences or other special rights of such shares and the qualifications, limitations and restrictions thereof. The preferred shares may rank prior to the common shares as to dividend rights, liquidation preferences or both. Each holder of preferred shares will be entitled to one vote for each preferred share held of record on all matters submitted to a vote of shareholders. The issuance of preferred shares and any conversion rights which may be specified by the Board of Directors for the preferred shares could adversely affect the voting power of holders of the common shares. The Board of Directors has no present intention to issue any of the preferred shares.

The following is a summary description of the rights of the common shares of HCFC, including the material express terms of such shares as set forth in HCFC's Articles of Incorporation.

LIQUIDATION RIGHTS

In the event of the complete liquidation or dissolution of HCFC, the holders of the Common Shares will be entitled to receive all assets of HCFC available for distribution, in cash or in kind, after payment or provision for payment of (i) all debts and liabilities of HCFC, (ii) any accrued dividend claims, and (iii) any interests in the Liquidation Account.

-77-

VOTING RIGHTS

The holders of the Common Shares will possess exclusive voting rights in HCFC, unless preferred shares are issued. Each holder of Common Shares will be entitled to one vote for each share held of record on all matters submitted to a vote of holders of common shares.

Section 1701.55 of the Ohio Revised Code provides in substance and effect that shareholders of a for profit corporation which is not a savings and loan association and which is incorporated under Ohio law must initially be granted the right to cumulate votes in the election of directors. Section 1701.69 of the Ohio Revised Code provides that an Ohio corporation may eliminate cumulative voting in the election of directors after the expiration of 90 days after the date of initial incorporation by filing with the Ohio Secretary of State an amendment to the articles of incorporation eliminating cumulative voting. The Articles of Incorporation of HCFC have been amended to eliminate cumulative voting. See "RESTRICTIONS ON ACQUISITION OF HOME CITY AND HCFC AND
RELATED ANTI-TAKEOVER PROVISIONS - Articles of Incorporation of HCFC -- Elimination of Cumulative Voting."

DIVIDENDS

The holders of the Common Shares will be entitled to the payment of dividends when, as and if declared by the Board of Directors and paid out of funds, if any, available under applicable laws and regulations for the payment of dividends. The payment of dividends is subject to federal and state statutory and regulatory restrictions. See "DIVIDEND POLICY" and "TAXATION - Federal Taxation" for a description of restrictions on the payment of cash dividends.

PREEMPTIVE RIGHTS

After the consummation of the Conversion, no shareholder of HCFC will have, as a matter of right, the preemptive right to purchase or subscribe for shares of any class, now or hereafter authorized, or to purchase or subscribe for securities or other obligations convertible into or exchangeable for such shares or which by warrants or otherwise entitle the holders thereof to subscribe for or purchase any such share.

RESTRICTIONS ON ALIENABILITY

See "THE CONVERSION - Restrictions on Repurchase of Common Shares" for a description of the limitations on the repurchase of stock by HCFC; "THE CONVERSION Restrictions on Transferability of Common Shares by Directors and Officers" for a description of certain restrictions on the transferability of Common Shares purchased by officers and directors; and "RESTRICTIONS ON ACQUISITION OF HOME CITY AND HCFC AND RELATED ANTI-TAKEOVER PROVISIONS" for information regarding regulatory restrictions on acquiring Common Shares.

REGISTRATION REQUIREMENTS

HCFC will register its common shares with the SEC pursuant to Section 12(g) of the Exchange Act prior to or promptly upon completion of the Conversion and will not deregister such shares for a period of three years following the completion of the Conversion. Upon such registration, the proxy and tender offer rules, insider trading restrictions, annual and periodic reporting and other requirements of the Exchange Act will apply.

LEGAL MATTERS

Certain legal matters pertaining to the Common Shares and the federal and Ohio tax consequences of the Conversion will be passed upon for Home City by Vorys, Sater, Seymour and Pease, 221 E. Fourth Street, Cincinnati, Ohio 45202. The validity of the Common Shares to be issued in connection with the Conversion will be passed upon for Webb by its counsel, Silver, Freedman, & Taff, L.L.P., 1100 New York Avenue, N.W., Washington, D.C. 20005.

-78-

EXPERTS

The consolidated financial statements of Home City as of June 30, 1996 and 1995, and for the years ended June 30, 1996, 1995 and 1994, included in this Prospectus have been audited by Robb, Dixon, Francis, Davis, Oneson & Company, certified public accountants, as stated in their report appearing herein and have been so included in reliance upon such report given upon the authority of that firm as experts in accounting and auditing.

Keller has consented to the publication herein of the summary of its letter to Home City setting forth its opinion as to the estimated pro forma market value of Home City as converted and to the use of its name and statements with respect to it appearing herein.

ADDITIONAL INFORMATION

HCFC has filed with the SEC a Registration Statement on Form S-1 (File No. 333-12501) under the Securities Act with respect to the Common Shares offered hereby. This Prospectus does not contain all of the information set forth in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the SEC. Such information may be inspected at the public reference facilities maintained by the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549, and copies may be obtained from the SEC at prescribed rates.

Home City has filed an Application for Approval of Conversion (the "Application") with the OTS. This document omits certain information contained in the Application. The Application, the exhibits and the financial statements that are part thereof may be inspected at the offices of the OTS, 1700 G Street, N.W., Washington, D.C. 20552, and the Central Regional Office, 200 W. Madison Street, Suite 1300, Chicago, Illinois 60606.

The SEC maintains a World Wide Web site, (http://www.sec.gov), that contains reports, proxy and information statements and other information regarding registrants that file with the SEC, including HCFC.

-79-

CONTENTS

                                                                          Page

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS                        F-2

CONSOLIDATED FINANCIAL STATEMENTS

    CONSOLIDATED BALANCE SHEETS                                           F-3
    (As of June 30, 1996 and 1995)

    CONSOLIDATED STATEMENTS OF INCOME                                     F-4
    (For the years ended June 30, 1996, 1995 and 1994)

    CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
    (For the years ended June 30, 1996, 1995 and 1994)                    F-5

    CONSOLIDATED STATEMENTS OF CASH FLOWS                                 F-6
    (For the years ended June 30, 1996, 1995 and 1994)


    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                            F-7


SCHEDULES: All schedules are omitted, as the information is either not
applicable or is included in the consolidated financial statements.

FINANCIAL STATEMENTS OF HOME CITY FINANCIAL CORPORATION: Financial statements of Home City Financial Corporation are not presented, as that corporation was not active during any of the periods presented.

F-1

INDEPENDENT AUDITOR'S REPORT

The Board of Directors
Home City Federal Savings Bank of Springfield Springfield, Ohio

We have audited the accompanying consolidated balance sheets of Home City Federal Savings Bank of Springfield as of June 30, 1996 and 1995, and the related statements of income, changes in equity and cash flows for the years ended June 30, 1996, 1995 and 1994. These financial statements are the responsibility of the Bank's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statements presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Home City Federal Savings Bank of Springfield as of June 30, 1996 and 1995, and the results of its operations and its cash flows for the years ended June 30, 1996, 1995 and 1994, in conformity with generally accepted accounting principles.

ROBB, DIXON
FRANCIS, DAVIS, ONESON
& COMPANY

Granville, Ohio
July 17, 1996, except as to Note S and Note T, which are as of September 30, 1996.

F-2

HOME CITY FEDERAL SAVINGS BANK OF SPRINGFIELD
SPRINGFIELD, OHIO
CONSOLIDATED BALANCE SHEETS

=============================================================================================================
                                                                                      (Dollars in thousands)

                                                                                              June 30,
                                                                                      -----------------------
                                                                                      1996               1995
                                                                                      ----               ----
ASSETS
Cash and cash equivalents
    Cash and amounts due from depository institutions                                  $   855        $   570
    Interest-bearing deposits in other banks                                               588            307
    Federal Funds sold                                                                     400          1,500
                                                                                       -------        -------

          Total cash and cash equivalents                                                1,843          2,377

Time deposits with original maturities of 90 days or more                                1,061            360
Investment securities

    Securities held-to-maturity (fair value of $0 in 1996 and $1,909 in 1995)                0          1,901
    Securities available-for-sale, at fair value                                         2,188            259
Mortgage-backed securities
    Securities held-to-maturity (fair value of $0 in 1996 and $3,603 in 1995)                0          3,667
    Securities available-for-sale, at fair value                                         2,975              0
Loans, net                                                                              45,225         38,960
Accrued interest receivable                                                                273            169
Premises and equipment, net                                                                488            468
Investment required by law - stock in Federal Home Loan Bank                               394            288
Deferred income taxes                                                                        0             21
Cash surrender value of life insurance                                                   1,044              0
Other assets                                                                               237            108
                                                                                       -------        -------

      TOTAL ASSETS                                                                     $55,728         48,578
                                                                                       =======        =======

LIABILITIES AND EQUITY
Deposits                                                                               $47,174        $40,936
Advances from Federal Home Loan Bank                                                     2,903          2,618
Accrued interest payable                                                                    49             42
Advance payments by borrowers for taxes and insurance                                       20             34
Deferred income taxes                                                                       68              0
Other liabilities                                                                          116             63
                                                                                       -------        -------

      TOTAL LIABILITIES                                                                 50,330         43,693

COMMITMENTS AND CONTINGENCIES                                                                0              0

EQUITY
Retained earnings, substantially restricted                                              5,271          4,757
Unrealized gain on securities available-for-sale, net of applicable deferred
   income taxes                                                                            127            128
                                                                                       -------        -------

      TOTAL EQUITY                                                                       5,398          4,885
                                                                                       -------        -------

      TOTAL LIABILITIES AND EQUITY                                                     $55,728        $48,578
                                                                                       =======        =======
- -------------------------------------------------------------------------------------------------------------
See accompanying notes.

F-3

HOME CITY FEDERAL SAVINGS BANK OF SPRINGFIELD
SPRINGFIELD, OHIO
CONSOLIDATED STATEMENTS OF INCOME

===================================================================================================
                                                                             (Dollars in thousands)

                                                                        Years ended June 30,
                                                                 ----------------------------------
                                                                  1996          1995          1994
                                                                 ------        ------        ------
INTEREST INCOME
Interest and fees on loans                                       $4,094        $3,344        $3,074
Interest on investment securities                                   143           145           103
Interest on mortgage-backed securities                              209           274           314
Interest on deposits in banks and federal funds sold                 61            72            51
                                                                 ------        ------        ------
     TOTAL INTEREST INCOME                                        4,507         3,835         3,542
                                                                 ------        ------        ------

INTEREST EXPENSE
Interest on interest-bearing checking accounts                        3             0             1
Interest on savings accounts                                        251           395           608
Interest on certificates of deposits                              2,116         1,440           799
Interest on advances from Federal Home Loan Bank                    172           107            38
                                                                 ------        ------        ------

     TOTAL INTEREST EXPENSE                                       2,542         1,942         1,446
                                                                 ------        ------        ------

     NET INTEREST INCOME                                          1,965         1,893         2,096
Provision for loan losses                                            50           109           113
                                                                 ------        ------        ------

     NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES          1,915         1,784         1,983

OTHER INCOME
Service charges                                                       9             2             1
Life insurance                                                       46             0             0
Other                                                                 3             7            11
                                                                 ------        ------        ------

     TOTAL OTHER INCOME                                              58             9            12
                                                                 ------        ------        ------

OTHER EXPENSES
Salaries and employee benefits                                      532           398           311
Supplies, telephone and postage                                      44            29            28
Occupancy and equipment                                             102           104           120
Deposit insurance                                                    96            83            83
Data processing                                                      54            47            63
Legal, accounting and exam                                          110            83            70
Franchise tax                                                        72            63            53
Other                                                               206           191           195
                                                                 ------        ------        ------
     TOTAL OTHER EXPENSES                                         1,216           998           923
                                                                 ------        ------        ------

     NET INCOME BEFORE FEDERAL INCOME TAX EXPENSE                   757           795         1,072

Federal income tax expense                                          243           240           367
                                                                 ------        ------        ------
     NET INCOME                                                  $  514        $  555        $  705
                                                                 ======        ======        ======
- ---------------------------------------------------------------------------------------------------
See accompanying notes.

F-4

HOME CITY FEDERAL SAVINGS BANK OF SPRINGFIELD
SPRINGFIELD, OHIO
STATEMENTS OF CHANGES IN EQUITY

=================================================================================================================
                                            (Dollars in thousands)

                                                                                 Unrealized gain
                                                                             (loss) on securities
                                                                               available-for-sale
                                                              Retained          net of applicable          Total
                                                              earnings        deferred income taxes        equity
                                                              --------        ---------------------        ------

Balances at June 30, 1993                                      $ 3,497              $     0               $ 3,497

Net income                                                         705                    0                   705

Change in accounting principle to adopt SFAS 115, net
    of applicable deferred income taxes of $47                       0

                                                                                         91                    91
Change in unrealized gain (loss) on securities
    available-for-sale, net of applicable deferred
    income taxes of $11                                              0                   22                    22
                                                               -------              -------               -------

Balances at June 30, 1994                                        4,202                  113                 4,315

Net income                                                         555                    0                   555

Change in unrealized gain on securities
    available-for-sale, net of applicable deferred                   0                   15                    15
    income taxes of $8
                                                               -------              -------               -------

Balances at June 30, 1995                                        4,757                  128                 4,885

Net income                                                         514                    0                   514

Change in unrealized gain on securities
    available-for-sale, net of applicable deferred                   0                   (1)                   (1)
    income taxes
                                                               -------              -------               -------

Balance of June 30, 1996                                       $ 5,271              $   127               $ 5,398
                                                               =======              =======               =======
- -----------------------------------------------------------------------------------------------------------------
See accompanying notes.

F-5

HOME CITY FEDERAL SAVINGS BANK OF SPRINGFIELD
SPRINGFIELD, OHIO
CONSOLIDATED STATEMENTS OF CASH FLOWS

=======================================================================================================================
                                           (Dollars in thousands)

                                                                                     (Dollars in thousands)
                                                                                       Years ending June 30,
                                                                       ------------------------------------------------
                                                                         1996               1995                1994
                                                                       -------             -------             -------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income                                                             $   514             $   555             $   705
Adjustments to reconcile net income to net cash provided by
   operating activities:
    Premium amortization, net of discount accretion                         42                 (17)                (34)
    Provision for loan losses                                               50                 109                 113
    Gain on sale of real estate owned                                        0                   0                   1
    Depreciation                                                            39                  33                  32
    Deferred income taxes                                                   89                   7                 (12)
    Life insurance income, net of expenses                                 (19)                  0                   0
    Changes in operating assets and liabilities:
      Increase in accrued income receivable                               (103)                (52)                (47)
      Increase in other assets                                            (129)                (66)                 (4)
      Increase in accrued interest payable                                   7                  25                   8
      Increase in other liabilities                                         53                   4                  (7)
                                                                       -------             -------             -------
    NET CASH PROVIDED BY OPERATING ACTIVITIES                              543                 598                 755
                                                                       -------             -------             -------

CASH FLOWS FROM INVESTING ACTIVITIES:
Net increase in time deposits                                             (700)               (361)                  0
Purchases of held-to-maturity securities                                     0              (3,880)             (3,293)
Proceeds from maturities of held-to-maturity securities                    500               4,121               3,750
Purchases of available-for-sale securities                                (496)                 (3)                (10)
Proceeds from sales of available-for-sale securities                         0                  78               1,129
Proceeds from maturities of available-for-sale securities                   20                   0                   0
Payments on held-to-maturity mortgage backed securities                    278                 564               1,009
Payments on available-for-sale mortgage backed securities                  319                   0                   0
Proceeds for sales of loans                                              2,760                 338                 131
Net increase in loans                                                   (9,075)             (8,306)             (2,699)
Purchases of premises and equipment                                        (60)                (35)                (88)
Proceeds from sale of real estate held for investment                        0                   3                 (19)
Proceeds from sale of real estate owned                                      0                   0                  25
Purchase of Federal Home Loan Bank stock                                  (106)                (41)                (32)
Purchase of life insurance contracts                                    (1,025)                  0                   0
                                                                       -------             -------             -------
   NET CASH USED IN INVESTING ACTIVITIES                                (7,585)             (7,522)                (97)
                                                                       -------             -------             -------

CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in deposits                                      6,238               6,120              (1,872)
Proceeds from advances from Federal Home Loan Bank                         500               2,310               2,200
Payments on advances from Federal Home Loan Bank                          (216)               (116)             (2,236)
Net decrease in advance payments by borrowers for tax and
insurance                                                                  (14)                  0                   0
                                                                       -------             -------             -------
    NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
                                                                         6,508               8,314              (1,908)
                                                                       -------             -------             -------
    NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
                                                                          (534)              1,390              (1,250)
    CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR
                                                                         2,377                 987               2,237
                                                                       -------             -------             -------
    CASH AND CASH EQUIVALENTS AT END OF YEAR                           $ 1,843             $ 2,377             $   987
                                                                       =======             =======             =======

- ----------------------------------------------------------------------------------------------------------------------
See accompanying notes

F-6

HOME CITY FEDERAL SAVINGS BANK OF SPRINGFIELD
SPRINGFIELD, OHIO

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF CONSOLIDATION
The consolidated financial statements include the accounts of Home City Federal Savings Bank of Springfield (the Bank) and its subsidiary, Homciti Service Corp. All material intercompany balances and transactions have been eliminated in consolidation.

NATURE OF OPERATIONS
The Bank provides a variety of financial services to individuals and corporate customers, through its one office in Springfield, Ohio, which is primarily a small industrial area. The Bank's primary deposit products are savings accounts and certificates of deposit. Its primary lending products are single-family residential loans. Homciti Service Corp. invests in stock of the Bank's data service provider and a local joint venture. Both of such interests are minority interests.

USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted accounting principals requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for losses on loans. In connection with the determination of the allowances for losses on loans, management obtains independent appraisals for significant properties.

A majority of the Bank's loan portfolio consists of single-family residential loans in the Springfield, Ohio area. The regional economy depends heavily on some 200 diversified industries. Accordingly, the ultimate collectibility of a substantial portion of the Bank's loan portfolio are susceptible to changes in local market conditions.

While management uses available information to recognize losses on loans, future additions to the allowances may be necessary based on changes in local economic conditions. In addition, regulatory agencies, as an integral part of their examination process, periodically review the Bank's allowances for losses on loans. Such agencies may require the Bank to recognize additions to the allowances based on their judgments about information available to them at the time of their examination. Because of these factors, it is reasonably possible that the allowances for losses on loans may change materially in the near term.

INVESTMENT SECURITIES

SECURITIES HELD TO MATURITY: Government, federal agency and municipal debt securities that management has the positive intent and ability to hold to maturity are reported at cost, adjusted for amortization of premiums and accretion of discounts that are recognized in interest income using methods approximating the interest method over the period to maturity.

SECURITIES AVAILABLE FOR SALE: Available-for-sale securities consist of investment securities not classified as held-to-maturity. Unrealized holding gains and losses, net of tax, on available-for-sale securities are reported as a net amount in a separate component of equity until realized. Gains and losses on the sale of available-for-sale securities are determined using the specific-identification method. The amortization of premiums and the accretion of discounts are recognized in interest income using methods approximating the interest method over the period to maturity.

F-7

MORTGAGE-BACKED SECURITIES

Mortgage-backed securities represent participating interests in pools of long-term first mortgage loans originated and serviced by issuers of the securities. Mortgage-backed securities are carried as available-for-sale and are carried at fair value. Unrealized gains and losses on securities available-for-sale are recognized as direct increases or decreases in equity. Cost of securities sold is recognized using the specific identification method.

LOANS

Loans are stated at unpaid principal balances, less the allowance for loan losses, net deferred loan fees and loans-in-process.

Loan origination fees, as well as certain direct origination costs, are deferred and amortized as a yield adjustment over the contractual lives of the related loans using the interest method. Amortization of deferred loan fees is discontinued when a loan is placed on nonaccrual status.

Loans are placed on nonaccrual when principal or interest is delinquent for 90 days or more. Any unpaid interest previously accrued on those loans is reversed from income. Interest income on nonaccrual loans is recognized only to the extent of interest payments received.

The allowance for loan losses is maintained at a level which, in management's judgment, is adequate to absorb credit losses inherent in the loan portfolio. The amount of the allowance is based on management's evaluation of the collectibility of the loan portfolio, including the nature of the portfolio, credit concentrations, trends in historical loss experience, specific impaired loans, and economic conditions. Allowances for impaired loans are generally determined based on collateral values or the present value of estimated cash flows. The allowance is increased by a provision for loan losses, which is charged to expense, and reduced by charge-offs, net of recoveries.

PREMISES AND EQUIPMENT

Premises and equipment are stated at cost less accumulated depreciation. Depreciation of property and equipment is computed principally on the straight-line method over the following estimated useful lives:

                                     Years
                                     -----
Buildings and improvements           10-50
Furniture and equipment               5-25

INCOME TAXES

The Bank files a consolidated federal income tax return on a calendar year basis. Income taxes are provided for the tax effects of the transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related primarily to differences between the basis of available-for-sale securities, allowance for loan losses, accumulated depreciation, partnership income, deferred loan fees, accrued pension expenses, and non-accrual loans for financial and income tax reporting. The deferred tax assets and liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled.

PENSION PLAN

The Bank has a pension plan covering substantially all employees. It is the policy of the Bank to fund the maximum amount that can be deducted for federal income tax purposes but in amounts not less than the minimum amounts required by law.

STATEMENTS OF CASH FLOWS

The Bank considers all cash and amounts due from depository institutions, interest-bearing deposits in other banks, and federal funds sold to be cash equivalents for purposes of the statements of cash flows. Only investments with original maturities under 90 days are considered cash equivalents.

F-8

FAIR VALUES OF FINANCIAL INSTRUMENTS

Statement of Financial Accounting Standards No. 107, Disclosures about Fair Value of Financial Instruments, requires disclosure of fair value information about financial instruments, whether or not recognized in the statement of financial condition. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instruments. Statement No. 107 excluded certain financial instruments and all non-financial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Bank.

The following methods and assumptions were used by the Bank in estimating its fair value disclosures for financial instruments:

Cash and cash equivalents: The carrying amounts reported in the statement of financial condition for cash and cash equivalents approximate those assets' fair values.

Time deposits: Fair values for time deposits are estimated using a discounted cash flow analysis that applies interest rates currently being offered on certificates to a schedule of aggregated contractual maturities on such time deposits.

Investment securities (including mortgage-backed securities): Fair values for investment securities are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments.

Loans: For variable-rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying amounts. The fair values for other loans (for example, fixed rate commercial real estate and rental property mortgage loans and commercial and industrial loans) are estimated using discounted cash flow analysis, based on interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. Loan fair value estimates include judgments regarding future expected loss experience and risk characteristics. The carrying amount of accrued interest receivable approximates its fair value.

Deposits: The fair values disclosed for demand deposits (for example, interest-bearing checking accounts and passbook accounts) are, by definition, equal to the amount payable on demand at the reporting date (that is, their carrying amounts). The fair values for certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated contractual maturities on such time deposits. The carrying amount of accrued interest payable approximates fair value.

Advances from Federal Home Loan Bank: The fair value for FHLB advances are estimated using a discounted cash flow calculation that applies interest rates currently being offered on FHLB advances of aggregated contractual maturities of such advances.

RECLASSIFICATIONS

Certain amounts in 1995 have been reclassified to conform with the 1996 presentation.

F-9

NOTE B - INVESTMENT SECURITIES

Securities held-to-maturity consist of the following at June 30, 1995:

                                                  (Dollars in thousands)
                                                     Gross       Gross
                                       Amortized   Unrealized  Unrealized      Fair
                                          Cost       Gains       Losses        Value
                                          ----       -----       ------        -----
U.S. government & federal agencies       $1,496       $0         $    0       $1,496

State & local governments                   405        8              0          413
                                         ------       --         ------       ------

                                         $1,901       $8         $    0       $1,909
                                         ======       ==         ======       ======


         Securities available-for-sale consist of the following:

                                         June 30. 1996                                     June 30.1995
                        -----------------------------------------------    ---------------------------------------------
                                      Gross        Gross                                 Gross       Gross
                        Amortized   Unrealized   Unrealized        Fair    Amortized   Unrealized   Unrealized     Fair
                          Cost        Gains        Losses         Value       Cost       Gains       Losses        Value
                         ------      ------       --------        -----      ------     -------     --------       -----
U.S.
government &
federal agencies        $1,001       $   0        $    (4)       $  997       $  0       $  0         $  0         $  0

State & local
governments                879           6             (2)          883          0          0            0            0

Equity securities
                            65         243              0           308         65        194            0          259
                        ------       -----        -------        ------       ----       ----         ----         ----

                        $1,945       $ 249        $    (6)       $2,188       $ 65       $194         $  0         $259
                        ======       =====        =======        ======       ====       ====         ====         ====


         The following is a summary of maturities of securities
available-for-sale as of June 30, 1996:

                                                  (Dollars in thousands)
                                              Securities available-for-sale

                                                 Amortized       Fair
                                                    Cost         Value
AMOUNTS MATURING IN:
One year or less                                   $  134       $  134
After one year through five years                   1,569        1,565
After five years through ten years                    177          181
After ten years                                        65          308
                                                   ------       ------
                                                   $1,945       $2,188
                                                   ======       ======

During the year ended June 30, 1996, the Bank sold no securities. During the year ended June 30, 1995, the Bank sold securities available-for-sale for total proceeds of approximately $78,000, resulting in no gross realized gains and no gross realized losses. During the year ended June 30, 1994, the Bank sold securities for total proceeds of approximately $1,129,000, resulting in no gross realized gains and no gross realized losses.

On December 31, 1995, debt securities with an amortized cost of $1,405,000 were transferred from held-to- maturity to available-for-sale to potentially reduce the Bank's state franchise tax expense. The securities had an

F-10

unrealized gain of approximately $6,000. There were no securities transferred between classifications during the year ended June 30, 1995 and 1994.

No investment securities were pledged to secure deposits as required or permitted by law.

NOTE C - MORTGAGE-BACKED SECURITIES

Mortgage-backed securities consist of the following:

                                                            (Dollars in thousands)
                                 Available-for-sale                                         Held-to-maturity
                                    June 30, 1996                                             June 30, 1995
            ------------------------------------------------------       -------------------------------------------------------
                             Gross           Gross                                        Gross          Gross
             Amortized     Unrealized     Unrealized         Fair         Amortized     Unrealized     Unrealized        Fair
               Cost          Gains          Losses          Value           Cost          Gains          Losses          Value
              ------        -------        --------         -----          ------        -------        --------         -----
GNMA          $3,020         $  2          $   (76)         $2,946         $3,635         $  9          $   (77)         $3,567

FHLMC             26            3                0              29             32            4                0              36
              ------         ----          -------          ------         ------         ----          -------          ------
              $3,046         $  5          $   (76)         $2,975         $3,667         $ 13          $   (77)         $3,603
              ======         ====          =======          ======         ======         ====          =======          ======

The amortized cost and fair value of mortgage-backed securities at June 30, 1996 by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations without call or prepayment penalties.

                                          (Dollars in thousands)
                                          Amortized        Fair
                                            Cost           Value
                                          ---------      ---------
Mortgage-backed securities:
After five years through ten years         $  915         $  903
After ten years                             2,131          2,072
                                           ------         ------
                                           $3,046         $2,975
                                           ======         ======

During the years ended June 30, 1996, 1995 and 1994, the Bank sold no mortgage-backed securities.

On December 31, 1995, mortgage-backed securities with an amortized cost of $3,358,000 were transferred from held-to-maturity to available-for-sale to potentially reduce the Bank's state franchise tax expense. The mortgage-backed securities had an unrealized gain of approximately $38,000. There were no securities transferred between classifications during the year ended June 30, 1995.

Investment securities with a carrying amount of approximately $906,000 and $500,000 were pledged to secure deposits as required or permitted by law as of June 30, 1996 and 1995, respectively.

F-11

NOTE D-LOANS

Loans at June 30, 1996 and 1995 are summarized as follows:

                                                            (Dollars in thousands)
                                                           1996               1995
                                                          ------            -------
Loans secured by first mortgages on real estate:
  1-4 family dwelling units                              $ 31,893          $ 24,956
  5 or more dwelling units                                  3,233             3,288
  Non-residential properties                                7,255             7,309
  Land                                                      2,223             1,684
  Construction                                              2,350             4,582
  Consumer                                                  1,641               201
  Commercial                                                   73                 0
                                                         --------          --------

                                                           48,668            42,020
                                                         --------          --------

Allowance for loan losses                                    (362)             (319)
Net deferred loan origination fees                           (447)             (420)
Loans in process                                           (2,634)           (2,321)
                                                         --------          --------

Total                                                    $ 45,225          $ 38,960
                                                         ========          ========


         An analysis of the allowance for loan losses is as follows:

                                          (Dollars in thousands)

                                    1996           1995           1994
                                    ----           ----           ----
Balance, beginning of year         $ 319          $ 229          $ 198
Provision for losses                  50            109            113
Loans charged off                     (7)           (19)          (107)
                                   -----          -----          -----
Recoveries                             0              0             25
                                   -----          -----          -----
Balance, end of year               $ 362          $ 319          $ 229
                                   =====          =====          =====

At June 30, 1996 and 1995, the Bank had loans amounting to approximately $72,000 and $17,000, respectively, that were specifically classified as impaired. The average balance of these loans amounted to approximately $104,000 and $16,000 for the years ended June 30, 1996 and 1995, respectively. The allowance for loan losses related to impaired loans amounted to approximately $2,000 at June 30, 1996. No portion of the allowance for loan loss related to impaired loans at June 30, 1995.

In addition, at June 30, 1996 and 1995, the Bank had other nonaccrual loans of approximately $175,000 and $190,000, respectively, for which impairment had not been recognized. Interest income that would have been recorded under the original terms of such loans and the interest income actually recognized for such loans are set forth in the following table:

                                         (Dollars in thousands)
                                           1996         1995
                                          -------      ------
Interest income that would have
    been recorded                           $16         $12
Interest income actually recognized           8           2
                                            ---         ---
Interest income foregone                    $ 4         $10
                                            ===         ===

F-12

The Bank has no commitments to loan additional funds to the borrowers of impaired or nonaccrual loans.

At June 30, 1996 and 1995, the Bank serviced loans for others with a principal balance of $3,358,000 and $2,797,000, respectively.

In the ordinary course of business, the Bank has and expects to continue to have transactions, including borrowings, with its officers, directors, and their affiliates. In the opinion of management, such transactions were on substantially the same terms, including interest rates and collateral, as those prevailing at the time of comparable transactions with other persons and did not involve more than a normal risk of collectibility or present any other unfavorable features to the Bank. All loans to such borrowers are summarized as follows:

                            (Dollars in thousands)

Balance, at June 30, 1995         $ 1,085

New loans                               0
Payments                              (23)
                                  -------
Balance, at June 30, 1996         $ 1,062
                                  =======



NOTE E - ACCRUED INTEREST RECEIVABLE

Accrued interest receivable at June 30, 1996 and 1995 consists of the following:


                                (Dollars in thousands)

                                   1996         1995
                                  ------       -----
Loans                              $246         $143
Mortgage-backed securities           19           23
Investments and other                 8            3
                                   ----         ----

Totals                             $273         $169
                                   ====         ====



NOTE F - PREMISES AND EQUIPMENT

         A summary of premises and equipment at June 30, 1996 and 1995 follows:

                                          (Dollars in thousands)

Land                                       $ 113          $ 113
Buildings and improvements                   424            392
Furniture, fixtures, and equipment           275            249
                                           -----          -----
                                             812            754
Accumulated depreciation                    (324)          (286)
                                           -----          -----

Totals                                     $ 488          $ 468
                                           =====          =====

F-13

NOTE G - SUPPLEMENTAL DISCLOSURES

The following are supplemental disclosures for the Statement of Cash Flows for the years ended June 30, 1996, 1995 and 1994

                                                                             (Dollars in thousands)

                                                                      1996            1995            1994
                                                                      ----            ----            ----
Cash paid during the year for interest                              $ 2,535          $1,927         $1,438
Cash paid during the year for income taxes                              283             272            379
Total change in unrealized gain on securities available-for-sale         (1)             23            124

NOTE H - CASH SURRENDER VALUE OF LIFE INSURANCE

         In September 1995, the Bank purchased life insurance policies on each
of its directors other than Douglas C. Ulery. The Bank is the beneficiary of
such policies. At June 30, 1996 there were no notes payable to the insurance
company.

NOTE I - DEPOSITS

         Deposit account balances at June 30, 1996 and 1995, are summarized as
follows:

                                                              (Dollars in thousands)
                                                         1996                           1995
                                              -------------------------       --------------------------

                                               Amount          Percent          Amount         Percent
Non-interest bearing checking accounts         $   302            0.6%         $     0            0.0%
Now and money market accounts                      395            0.8%               0            0.0%
Passbook savings accounts                        9,561           20.3%          10,500           25.6%
Certificates of deposit                         36,916           78.3%          30,436           74.4%
                                               -------         ------          -------         ------

Totals                                         $47,174         100.00%         $40,936         100.00%
                                               =======         ======          =======         ======



         The aggregate amount of short-term jumbo CD's, each with a minimum
denomination of $100,000, was approximately $7,216,000 and $4,061,000 at June
30, 1996 and 1995, respectively. Deposits in excess of $100,000 are not insured
by the FDIC.

         At June 30, 1996, the scheduled maturities of CD's are as follows:

                                (Dollars in thousands)
July 1,1996 to June 30,1997           $15,409
July 1, 1997 to June 30, 1998          16,573
July 1, 1998 to June 30, 1999           4,254
July 1,1999 to June 30,2000               403
After June 30, 2000                       277
                                      -------

Totals                                $36,916
                                      =======

The Bank held deposits of approximately $806,000 for related parties at June 30, 1996.

F-14

NOTE J - ADVANCES FROM FEDERAL HOME LOAN BANK

Advances from the Federal Home Loan Bank consist of the following at June 30, 1996 and 1995, respectively:

                                                                                     (Dollars in thousands)
                                                                            Current interest          Balance
                                                                                               ----------------------
                                                                                 Rate           1996            1995
                                                                                ------         ------           -----
Fixed rate advance, with monthly interest payments:
 Advance due September 25, 1996                                                  5.80%         $  500         $
 Fixed rate advances, with monthly principal and interest payments:
 Advance due February 1,2003                                                     6.05%            110            122
 Advance due March 1,2003                                                        5.85%            236            263
 Advance due December 31,2004                                                    8.35%            510            570
 Advance due January 1,2005                                                      8.35%            303            326
 Advance due January 1,2005                                                      8.30%            601            671
 Advance due February 1,2010                                                     3.30%            643            666
                                                                                               ------         ------
Totals                                                                                         $2,903         $2,618
                                                                                               ======         ======


         Federal Home Loan Bank ("FHLB") advances are collateralized by all
shares of FHLB stock owned by the Bank (totaling $394,000) and by 100% of the
Bank's qualified mortgage loan portfolio (totaling approximately $21,759,000).
Based on the carrying amount of FHLB stock owned by the Bank, total FHLB
advances are limited to approximately $7,882,000.

         The aggregate minimum future principal payments on borrowings are as
follows:

July 1, 1996 to June 30, 1997         $  719
July 1,1997 to June 30,1998              221
July 1,1998 to June 30,1999              224
July 1, l999 to June 30, 2000            227
After June 30, 2000                    1,512
                                      ------

Totals                                $2,903
                                      ------


NOTE K - FEDERAL INCOME TAXES

         The consolidated provision for income taxes for the years ended June
30, 1996, 1995 and 1994 consists of the following:

                                         (Dollars in thousands)

                                     1996         1995          1994
                                    ------       ------        ------
Current federal tax expense          $154         $233         $ 379
Deferred federal tax expense           89            7           (12)
                                     ----         ----         -----

                                     $243         $240         $ 367
                                     ====         ====         =====

F-15

The provision for federal income taxes differs from that computed by applying federal statutory rates to income (loss) before federal income tax expense, as indicated in the following analysis:

                                                    (Dollars in thousands)
                                              1996            1995            1994
                                             ------          ------          -----
Statutory tax provision at a 34% rate         $ 257           $ 268           $364
Effect of tax-exempt income                     (31)            (11)             0
Other                                            17             (17)             3
                                              -----           -----           ----
                                              $ 243           $ 240           $367
                                              =====           =====           ====
Effective tax rate                             32.1%           30.2%          34.2%


         Deferred tax assets and liabilities in other liabilities at June 30,
1996, and in other assets at June 30, 1995, consist of the following:

                                                 (Dollars in thousands)

                                                  1996          1995
                                                 ------        ------
Deferred tax assets:
    Deferred loan fees                            $  5          $ 76
    Nonaccrual loan interest                         6             2
    Allowance for loan loss                          6             7
    Other                                            3             9
                                                  ----          ----
                                                    20            94
                                                  ----          ----

Deferred tax liabilities
    Accumulated depreciation                       (19)           (8)
    Net unrealized appreciation on
       available-for-sale securities               (69)          (65)
                                                  ----          ----
                                                   (88)          (73)
                                                  ----          ----
Net deferred tax assets (liabilities)         $(68)         $ 21
                                                  ====          ====

Included in retained earnings at June 30, 1996 and 1995 is approximately $1,084,000 in bad debt reserves for which no deferred federal income tax liability has been recorded. These amounts represent allocations of income to bad debt deductions for tax purposes only. Reduction of these reserves for purposes other than tax bad-debt losses or adjustments arising from carryback of net operating losses would create income for tax purposes, which would be subject to the then-current corporate income tax rate. The unrecorded deferred liability on these amounts was approximately $369,000.

NOTE L - PENSION PLAN

In connection with the Financial Institutions' Retirement Fund, the Bank participates with other companies in the financial institution industry in a defined benefit plan. The plan covers all of the Bank's employees who are over 21 years old with at least one year of service. Pension expense amounted to $25,000, $8,000 and $6,000 for the years ended June 30, 1996, 1995 and 1994, respectively. Because the Bank participates in a group plan, separate disclosures for the Bank pursuant to SFAS No. 87 are not available.

In 1994, the Bank also initiated a 401K Profit Sharing Plan. The plan covers all of the Bank's employees who are over 21 years old with at least one year of service. Participants may make salary savings contributions up to 15% of their compensation, 50% of which will be matched by the Bank, up to 6% of each employee's salary. Contributions charged to operations for the years ended June 30, 1996, 1995 and 1994 were $8,000, $5,000 and $0, respectively.

F-16

NOTE M - INCENTIVE COMPENSATION PLAN

The Bank has an incentive compensation plan that covers all employees who are normally scheduled to work 1,040 hours or more per year. The Bank's contributions pursuant to the plan are based on a formula contained in the plan which incorporates factors relating to the Bank's performance and are contingent upon the Bank's attainment of certain levels of earnings, as defined in the plan. During the years ended June 30, 1996, 1995 and 1994, contributions to the plan charged to operations were $56,000, $38,000 and $0, respectively.

NOTE N - REGULATORY MATTERS

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

Qualitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the table below) of total and Tier I capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier I capital (as defined) to average assets (as defined). Management believes, as of June 30, 1996, that the Bank meets all adequacy requirements to which it is subject.

As of June 30, 1996, the most recent notification from the Bank's regulators categorized the Bank as adequately capitalized under the regulatory framework for prompt corrective action. To be categorized as adequately capitalized the Bank must maintain minimum total risk-based, Tier I risk-based, and Tier I leverage ratios as set forth in the table. There are no conditions or events since that notification that management believes have changed the institution's category.

The following reconciliation compares the Bank's capital under GAAP to its regulatory capital:

                                                  (Dollars in thousands)
                                                    Total         Tier I
                                                   Capital       Capital
                                                   -------       -------
Equity per GAAP                                     $5,398        $5,398

Less unrealized gain on securities available-
   for-sale, net of applicable income taxes           (127)         (127)

Plus allowance for loan loss                           362             0
                                                    ------        ------

Regulatory capital                                  $5,633        $5,271
                                                    ======        ======

F-17

The Bank's actual capital amounts and ratios are also presented in the table.

                                                      (Dollars in thousands)
                                                                             To be well capitalized
                                                                                   under prompt
                                                            For capital            corrective
                                          Actual        adequacy purposes:      action provisions
                                     ---------------    ------------------   ----------------------
                                     Amount    Ratio    Amount       Ratio    Amount          Ratio
                                     ------    -----    ------       -----    ------          -----
As of June 30, 1996:
   Total Capital
     (to Risk Weighted Assets)       $5,633    18.8%    $2,400        8.0%    $2,999          10.0%
   Tier I Capital
     (to Risk Weighted Assets)        5,271    17.6%       900        3.0%     1,800           6.0%
   Tier I Capital
     (to Average Assets)              5,271     9.5%       834        1.5%     2,779           5.0%

As of June 30, 1995:
   Total Capital
     (to Risk Weighted Assets)        5,076    19.2%     2,117        8.0%     2,646          10.0%
   Tier I Capital
     (to Risk Weighted Assets)        4,757    18.0%       794        3.0%     1,587           6.0%
   Tier I Capital
     (to Average Assets)              4,757     9.8%       729        1.5%     2,430           5.0%

NOTE O - COMMITMENTS AND CONTINGENCIES

In the normal course of business, the Bank has various outstanding commitments and contingent liabilities that are not reflected in the accompanying consolidated financial statements. The principal commitments of the Bank are as follows:

The Bank had outstanding commitments to originate loans as follows:

                                                              (Dollars in thousands)
                                               June 30,1996                             June 30,1995
                                ---------------------------------------    --------------------------------------
                                Fixed-rate    Variable-rate      Total     Fixed-rate    Variable-rate      Total
                                ----------    -------------      -----     ----------    -------------      -----
First mortgage                    $  837           $169          $1,006        $50           $510            $560
Consumer and other loans             292              0             292          0              0               0
                                  ------           ----          ------        ---           ----            ----

                                  $1,129           $169          $1,298        $50           $510            $560
                                  ======           ====          ======        ===           ====            ====

Interest rates on commitments at June 30, 1996, ranged from 7.75% to 10.00%. Interest rates on commitments at June 30, 1995, ranged from 7.125% to 11.00%. Loan commitments generally expire after 30 days.

In addition, the Bank is periodically a defendant in various legal proceedings arising in connection with its business. It is the best judgment of management that neither the financial position nor results of operations of the Bank will be materially affected by the final outcome of these legal proceeding.

F-18

NOTE P- FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK

The Bank is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit. These instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amounts recognized in the statements of financial condition.

The Bank's exposure to credit loss in the event of nonperformance by the other party to the financial instruments for commitments to extend credit is represented by the contractual notional amount of those instruments (see NOTE
O). The Bank uses the same credit policies in making commitments as it does for on-balance-sheet-instruments.

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Bank evaluates each customer's creditworthiness on a case-by-case basis. The amount and type of collateral obtained, if deemed necessary by the Bank upon extension of credit, varies and is based on management's credit evaluation of the counterparty.

At June 30, 1996, the Bank had deposits with the following banks in excess of FDIC insurance of $100,000:

                                       (Dollars in thousands)
Huntington National Bank                     $  705
Federal Home Loan Bank                        1,288
Springfield Federal Savings Bank                700

NOTE Q - FAIR VALUES OF FINANCIAL INSTRUMENTS

The estimated fair values of the Bank's financial instruments are as follows:

                                                           (Dollars in thousands)
                                            June 30, 1996                           June 30, 1995
                                      --------------------------            -----------------------------
                                      Carrying                              Carrying
                                       amount         Fair value             amount            Fair value
                                      --------        ----------            --------           ----------
Financial assets:
    Cash and cash equivalents         $ 1,843          $ 1,843              $ 2,377               $2,377
    Time deposits                       1,061            1,053                  360                  352
    Investment securities               2,188            2,188                2,160                2,168
    Mortgage-backed securities          2,975            2,975                3,667                3,603
    Loans, net of allowance            45,225           45,364               38,960            Not available

Financial liabilities:
    Deposits                           47,174           47,311               40,936            Not available
    Advances from FHLB                  2,903            2,954                2,618            Not available

The carrying amounts in the preceding table are included in the balance sheet under the applicable captions. The Bank adopted SFAS No. 107 on June 30, 1996. Fair values for loans, deposits and borrowed funds before June 30, 1996, are not available because the maintenance of such information was not required for fiscal years which ended before December 15, 1995.

F-19

NOTE R - SELECTED QUARTERLY FINANCIAL INFORMATION

The following table shows quarterly income and expense amounts

                                              (Dollars in thousands)
                                  6/30/96      3/31/96     12/31/95     9/30/95
                                  -------      -------     --------     -------
Interest income                    $1,102       $1,094       $1,057      $1,027
Interest expense                      662          653          633         600
Net interest income                   440          441          424         427
Provision for loan loss                50            0            0           0
Security gains, net                     0            0            0           0
Net income                            121          149          119         125
                                  6/30/95      3/31/95     12/31/94     9/30/94
                                  -------      -------     --------     -------
Interest income                    $1,007         $943         $911        $852
Interest expense                      577          516          453         396
Net interest income                   430          427          458         456
Provision for loan loss                22           15           63           9
Security gains, net                     0            0            0           0
Net income                            142          151          113         116

NOTE S - SUBSEQUENT EVENT - ONE-TIME SAIF ASSESSMENT

The Bank, a SAIF-insured institution, is subject to regulation by the OTS and the FDIC. The FDIC is authorized to establish different annual assessment rates for deposit insurance for members of the BIF and the SAIF. Legislation to recapitalize the SAIF and eliminate the significant premium disparity between the SAIF and the BIF became effective September 30, 1996. The recapitalization plan provides for the payment of a special assessment of $.657 per $100 of SAIF deposits held at March 31, 1995. Based on its $40.4 million in deposits at March 31, 1995, the Bank will pay an additional assessment of $265,000 by November 29, 1996.

The recapitalization plan also provides for the merger of the SAIF and BIF effective January 1, 1999, assuming all savings associations have become banks. As a result, it is expected that the thrift charter or the separate regulation of thrifts will be eliminated. As a result, the Bank would be regulated under federal law as a bank, and, as a result, would become subject to the more restrictive activity limitations imposed on national banks.

NOTE T - SUBSEQUENT EVENT - PLAN FOR STOCK CONVERSION

On September 3, 1996, the board of directors of the Bank adopted a Plan of Conversion, whereby the Bank will be converted from a mutual federal savings bank to a permanent stock federal savings bank with the concurrent formation of a holding company. Pursuant to the Plan of Conversion, shares of capital stock of the holding company will be offered to eligible account holders and such other persons as defined by the plan. The number of shares sold will be determined by reference to an independent appraisal of the Bank and will reflect its estimated pro forma market value, as converted. The plan provides that nontransferable subscription rights to purchase stock will be offered first to the Bank's eligible savings account holders; then to the Bank's tax-qualified employee plans; then to supplemental eligible account holders; and then, to the extent shares of the stock remain available, to other members of the Bank. Concurrently, or promptly after the subscription offering, and on a lowest priority basis, an opportunity to subscribe may also be offered to the general public in a direct community offering.

Subsequent to the conversion, savings account holders and borrowers will have no voting rights in the Bank. Voting rights will be vested exclusively in the stockholders of the holding company. Savings deposits will continue to be insured to the permissible extent in the Savings Association Insurance Fund; see Note S.

F-20

All costs associated with the conversion will be deferred and deducted from the proceeds of the sale of stock. If the conversion is not completed, such costs will be charged to expense. As of June 30, 1996, the Bank has incurred no such costs.

At the time of the conversion, the Bank will establish a "Liquidation Account" in an amount equal to the Bank's net worth as of the latest date of the financial statements. The Liquidation Account will be maintained for the benefit of depositors who continue to maintain their deposits in the Bank after the conversion. In the event of a complete liquidation (and only in such event), each eligible depositor will be entitled to receive a liquidation distribution from the liquidation account in the proportionate amount of the then-current adjusted balance for deposits then held, before any liquidation distribution may be made with respect to the stockholders. The Bank may not declare or pay a cash dividend on its common shares or repurchase any of its common shares if after the payment of such dividend or the repurchase of such shares the Bank's shareholders' equity would be reduced below the amount required for the liquidation account or the Bank's regulatory capital would fail to satisfy applicable regulatory requirements.

F-21


No person has been authorized to give any information or to make any representations other than as contained in this Prospectus, and, if given or made, such information or representations must not be relied upon as having been authorized by HCFC. This Prospectus does not constitute an offer to sell, or the solicitation of an offer to buy, any security, other than the Common Shares offered hereby, to any person in any jurisdiction in which such offer or solicitation is not authorized or in which the person making such offer or solicitation is not qualified to do so or to any person to whom delivery of this Prospectus would be unlawful. Neither the delivery of this Prospectus nor any sale hereunder shall, under any circumstances, create any implication that the information contained herein is correct as to any time subsequent to the date hereof.

TABLE OF CONTENTS

                                                                           Page
                                                                           ----
PROSPECTUS SUMMARY............................................................1
SELECTED CONSOLIDATED FINANCIAL
   INFORMATION AND OTHER DATA.................................................6
REGULATORY CAPITAL COMPLIANCE.................................................8
RISK FACTORS..................................................................9
HOME CITY FINANCIAL CORPORATION..............................................13
HOME CITY FEDERAL SAVINGS BANK
   OF SPRINGFIELD............................................................13
USE OF PROCEEDS..............................................................14
MARKET FOR COMMON SHARES.....................................................14
DIVIDEND POLICY..............................................................15
CAPITALIZATION...............................................................16
PRO FORMA DATA...............................................................17
SUMMARY CONSOLIDATED STATEMENTS OF INCOME....................................19
MANAGEMENT'S DISCUSSION AND
  ANALYSIS OF FINANCIAL CONDITION
  AND RESULTS OF OPERATIONS OF
  HOME CITY..................................................................20
RECENT DEVELOPMENTS..........................................................31
THE BUSINESS OF HOME CITY....................................................33
MANAGEMENT OF HCFC...........................................................49
MANAGEMENT OF HOME CITY......................................................49
REGULATION...................................................................54
TAXATION.....................................................................60
THE CONVERSION...............................................................62
RESTRICTIONS ON ACQUISITION OF
   HOME CITY AND HCFC AND RELATED
  ANTI-TAKEOVER PROVISIONS...................................................73
DESCRIPTION OF AUTHORIZED SHARES.............................................77
REGISTRATION REQUIREMENTS....................................................78
LEGAL MATTERS................................................................78
EXPERTS......................................................................79
ADDITIONAL INFORMATION.......................................................79
FINANCIAL STATEMENTS........................................................F-1



Up to 882,000 Common Shares

HOME CITY FINANCIAL CORPORATION

(Holding Company for Home City Federal Savings Bank of Springfield)


PROSPECTUS


CHARLES WEBB & COMPANY

A Division of

Keefe, Bruyette & Woods, Inc.

November ___, 1996


-80-

PART II: INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

*   Legal Fees and Expenses                          $98,000
*   Printing, Postage and Mailing                     40,000

    Appraisal Fees and Expenses                       15,000
*   Accounting Fees and Expenses                      50,000
*   Blue Sky Filing Fees and Expenses                  7,000
    Federal Filing Fees                               11,683
    Conversion Agent Fees                              7,000

*  Other Expenses                                      9,317
** Underwriting Fees and Expenses                    134,000
                                                    --------
                    Total estimated expenses        $372,000
                                                    ========


* Estimated.

** Home City and HCFC have retained Webb, to assist in the marketing of the Common Shares. Webb will consult with and advise Home City and HCFC and assist with the sale of the Common Shares in connection with the Conversion on a best efforts basis. The services to be rendered by Webb include assisting HCFC in conducting the Offering and educating Home City personnel about the Conversion process.

Webb will receive a management fee in the amount of $25,000. Webb will also receive a commission equal to 1.5% of the aggregate purchase price paid for Common Shares sold in the Conversion, excluding purchases by directors, officers and associates of such directors and officers, or the Home City Financial Corporation Employee Stock Ownership Plan. In addition, HCFC will reimburse Webb for certain expenses, including reasonable legal fees. If HCFC and Webb deem necessary, Webb may enter into Selected Dealers Agreements with other National Association of Securities Dealers, Inc. member firms for assistance in the sale of the Common Shares. Selected Dealers will receive fees equal to 5.5% of the aggregate purchase price of the Common Shares sold, if any, pursuant to Selected Dealer Agreements.

ITEM 14. INDEMNIFICATION OF OFFICERS AND DIRECTORS OF HOME CITY.

(A) FEDERAL REGULATIONS

As a federal savings bank, Home City is subject to federal regulations which provide that any person against whom any action, suit or other judicial or administrative proceeding, or threatened proceeding, whether civil, criminal, or otherwise, including any appeal or other proceeding for review (an "Action"), is brought by reason of the fact that such person is or was a director, officer or employee of Home City shall be indemnified by Home City for the following:

(i) Reasonable costs and expenses, including reasonable attorney's fees actually paid or incurred by such person in connection with proceedings related to the defense or settlement of an Action:

(ii) Any amount for which such person becomes liable by reason of any judgment in an Action; and

(iii) Reasonable costs and expenses, including reasonable attorney's fees, actually paid or incurred in any Action to enforce his rights under this section if the person attains a final judgment in favor of such person in such Action.

Such indemnification shall be made to such officer, director or employee only if the following requirements are met:

II-1


(i) Home City shall make the indemnification in connection with any Action which results in a final judgment on the merits in favor of such director, officer or employee; and

(ii) Home City shall make the indemnification in case of (A) settlement of any Action, (B) final judgment against such director, officer or employee, or (C) final judgment in favor of such director, officer or employee other than on the merits, only if a majority of the directors of Home City determines that such director, officer or employee was acting in good faith within what he or she reasonably believed under the circumstances was the scope of his or her employment or authority and for a purpose which he or she reasonably believed under the circumstances was in the best interest of Home City or its stockholders.

Home City may authorize payment of reasonable costs and expenses, including reasonable attorney's fees arising from the defense or settlement of any Action, to any director, officer or employee if a majority of the directors of Home City conclude that such person may become entitled to indemnification. The directors of Home City may impose conditions on such payment, and, before making an advance payment, Home City shall obtain an agreement from such person that Home City will be repaid if the person on whose behalf payment is made is later determined not to be entitled to such indemnification.

Home City currently maintains a directors' and officers' liability policy providing for insurance of directors and officers for liability incurred in connection with performance of their duties as directors and officers. Such policy does not, however, provide insurance for losses resulting from willful or criminal misconduct.

(B) HCFC'S CODE OF REGULATIONS

Article Five of HCFC's Code of Regulations provides for the indemnification of officers and directors as follows:

Section 5.01. Mandatory Indemnification. The corporation shall indemnify any officer or director of the corporation who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (including, without limitation, any action threatened or instituted by or in the right of the corporation), by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, trustee, officer, employee or agent of another corporation (domestic or foreign, nonprofit or for profit), partnership, joint venture, trust or other enterprise, against expenses (including, without limitation, attorneys' fees, filing fees, court reporters' fees and transcript costs), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and with respect to any criminal action or proceeding, he had no reasonable cause to believe his conduct was unlawful. A person claiming indemnification under this Section 5.01 shall be presumed, in respect of any act or omission giving rise to such claim for indemnification, to have acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and with respect to any criminal matter, to have had no reasonable cause to believe his conduct was unlawful, and the termination of any action, suit or proceeding by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, rebut such presumption.

II-2


Section 5.02. Court-Approved Indemnification. Anything contained in the Regulations or elsewhere to the contrary notwithstanding:

(A) the corporation shall not indemnify any officer or director of the corporation who was a party to any completed action or suit instituted by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, trustee, officer, employee or agent of another corporation (domestic or foreign, nonprofit or for profit), partnership, joint venture, trust or other enterprise, in respect of any claim, issue or matter asserted in such action or suit as to which he shall have been adjudged to be liable for acting with reckless disregard for the best interests of the corporation or misconduct (other than negligence) in the performance of his duty to the corporation unless and only to the extent that the Court of Common Pleas of Clark County, Ohio, or the court in which such action or suit was brought shall determine upon application that, despite such adjudication of liability, and in view of all the circumstances of the case, he is fairly and reasonably entitled to such indemnity as such Court of Common Pleas or such other court shall deem proper; and

(B) the corporation shall promptly make any such unpaid indemnification as is determined by a court to be proper as contemplated by this Section 5.02.

Section 5.03. Indemnification for Expenses. Anything contained in the Regulations or elsewhere to the contrary notwithstanding, to the extent that an officer or director of the corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Section 5.01, or in defense of any claim, issue or matter therein, he shall be promptly indemnified by the corporation against expenses (including, without limitation, attorneys' fees, filing fees, court reporters' fees and transcript costs) actually and reasonably incurred by him in connection therewith.

Section 5.04 Determination Required. Any indemnification required under
Section 5.01 and not precluded under Section 5.02 shall be made by the corporation only upon a determination that such indemnification of the officer or director is proper in the circumstances because he has met the applicable standard of conduct set forth in Section 5.01. Such determination may be made only (A) by a majority vote of a quorum consisting of directors of the corporation who were not and are not parties to, or threatened with, any such action, suit or proceeding, or (B) if such a quorum is not obtainable or if a majority of a quorum of disinterested directors so directs, in a written opinion by independent legal counsel other than an attorney, or a firm having associated with it an attorney, who has been retained by or who has performed services for the corporation, or any person to be indemnified, within the past five years, or
(C) by the shareholders, or (D) by the Court of Common Pleas of Clark County, Ohio, or (if the corporation is a party thereto) the court in which such action, suit or proceeding was brought, if any; any such determination may be made by a court under division (D) of this Section 5.04 at any time including, without limitation, any time before, during or after the time when any such determination may be requested of, be under consideration by or have been denied or disregarded by the disinterested directors under division (A) or by independent legal counsel under division (B) or by the shareholders under division (C) of this Section 5.04; and no failure for any reason to make any such determination, and no decision for any reason to deny any such determination, by the disinterested directors under division (A) or by independent legal counsel under division (B) or by shareholders under division
(C) of this Section 5.04 shall be evidence in rebuttal of the presumption recited in Section 5.01. Any determination made by the disinterested directors under division (A) or by independent legal counsel under division (B) of this
Section 5.04 to make indemnification in respect of any claim, issue or matter asserted in an action or suit threatened or brought by or in the right of the corporation shall be promptly communicated to the person who threatened or brought such action or suit, and within ten (10) days after receipt of such notification such person shall have the right to petition the Court of Common Pleas of Clark County, Ohio, or the court in which such action or suit was brought, if any, to review the reasonableness of such determination.

Section 5.05. Advances for Expenses. Expenses (including, without limitation, attorneys' fees, filing fees, court reporters' fees and transcript costs) incurred in defending any action, suit or proceeding referred to in
Section 5.01 shall be paid by the corporation in advance of the final disposition of such action, suit or proceeding to or on behalf of the officer or director promptly as such expenses are incurred by him, but only if such officer or director shall first agree, in writing, to repay all amounts so paid in respect of any claim, issue or other matter asserted in such action, suit or proceeding in defense of which he shall not have been successful on the merits or otherwise:

II-3


(A) if it shall ultimately be determined as provided in Section 5.04 that he is not entitled to be indemnified by the corporation as provided under
Section 5.01; or

(B) if, in respect of any claim, issue or other matter asserted by or in the right of the corporation in such action or suit, he shall have been adjudged to be liable for acting with reckless disregard for the best interests of the corporation or misconduct (other than negligence) in the performance of his duty to the corporation, unless and only to the extent that the Court of Common Pleas of Clark County, Ohio, or the court in which such action or suit was brought shall determine upon application that, despite such adjudication of liability, and in view of all the circumstances, he is fairly and reasonably entitled to all or part of such indemnification.

Section 5.06. Article Five Not Exclusive. The indemnification provided by this Article Five shall not be deemed exclusive of any other rights to which any person seeking indemnification may be entitled under the Articles or the Regulations or any agreement, vote of shareholders or disinterested directors, or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be an officer or director of the corporation and shall inure to the benefit of the heirs, executors, and administrators of such a person.

Section 5.07. Insurance. The corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, trustee, officer, employee, or agent of another corporation (domestic or foreign, nonprofit or for profit), partnership, joint venture, trust or other enterprise, against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the corporation would have the obligation or the power to indemnify him against such liability under the provisions of this Article Five.

Section 5.08. Certain Definitions. For purposes of this Article Five, and as examples and not by way of limitation:

(A) A person claiming indemnification under this Article 5 shall be deemed to have been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Section 5.01, or in defense of any claim, issue or other matter therein, if such action, suit or proceeding shall be terminated as to such person, with or without prejudice, without the entry of a judgment or order against him, without a conviction of him, without the imposition of a fine upon him and without his payment or agreement to pay any amount in settlement thereof (whether or not any such termination is based upon a judicial or other determination of the lack of merit of the claims made against him or otherwise results in a vindication of him); and

(B) References to an "other enterprise" shall include employee benefit plans; references to a "fine" shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to "serving at the request of the corporation" shall include any service as a director, officer, employee or agent of the corporation which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner he reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner "not opposed to the best interests of the corporation" within the meaning of that term as used in this Article Five.

Section 5.09. Venue. Any action, suit or proceeding to determine a claim for indemnification under this Article Five may be maintained by the person claiming such indemnification, or by the corporation, in the Court of Common Pleas of Clark County, Ohio. The corporation and (by claiming such indemnification) each such person consent to the exercise of jurisdiction over its or his person by the Court of Common Pleas of Clark County, Ohio, in any such action, suit or proceeding.

The Board of Directors is authorized, at their discretion, to obtain policies of insurance insuring the Association against loss caused by the acts of its directors, officers or employees and insuring its directors, officers or employees for those expenses which an association may indemnify such director, officer or employee under the authority of Revised Code Section 1151.151.

II-4


(C) INDEMNIFICATION AGREEMENTS

(I) AGREEMENT WITH KELLER & COMPANY, INC.

Home City has agreed to indemnify Keller in connection with certain matters related to the appraisal. Home City will indemnify Keller, its employees and affiliates, for certain costs and expenses, including reasonable legal fees, in connection with claims or litigation relating to the appraisal and arising out of any misstatement or untrue statement of a material fact in information supplied to Keller by Home City or by an intentional omission by Home City to state a material fact in the information so provided, except where Keller has been negligent or at fault.

(II) AGREEMENT WITH WEBB

Home City has agreed to indemnify and hold harmless Webb. In general, the agency agreement with Webb (the "Agency Agreement") provides that Home City will indemnify and hold harmless their directors, officers, employees, agents and any controlling person against any and all loss, liability, claim, damage or expense (including the fees and disbursements of counsel reasonably incurred) arising out of any untrue statement, or alleged untrue statement, of a material fact contained in the Summary Proxy Statement or the Prospectus, any application to regulatory authorities, any "blue sky" application, or any other related document prepared or executed by or on behalf of Home City with its consent in connection with, or in contemplation of, the transactions contemplated by the Agency Agreement, or any omission therefrom of a material fact required to be stated therein, unless such untrue statement or omission, or alleged untrue statement or omission, was made in reliance upon, and in conformity with, written information regarding Webb furnished to Home City by Webb expressly for use in the Summary Proxy Statement or the Prospectus.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.

No securities of HCFC have been sold by HCFC without registration pursuant to the Act, except as follows:

On August 14, 1996, in connection with the incorporation of HCFC, 100 common shares, without par value, of HCFC (the "Securities") were sold for an aggregate purchase price of $100 pursuant to Section 4(2) of the Act in a transaction not involving any public offering. The Securities were sold to Douglas L. Ulery, the President of HCFC, who had access to all material information about HCFC. The Securities were offered without the use of any form of general solicitation or advertising. No underwriter was involved in the transaction, and no commission, discount or other remuneration was paid or given in connection with the sale of the Securities. Under the terms of the Subscription Agreement between HCFC and Mr. Ulery, the Securities will be repurchased by HCFC on the effective date of the Conversion.

II-5


ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(A) EXHIBITS

The exhibits filed as a part of this Registration Statement are as follows:

*1.1              Engagement letter with Charles Webb & Company
 1.2               Agency Agreement with Charles Webb & Company
                  (proposed)
*2                Plan of Conversion
*3.1              Articles of Incorporation of Home City Financial
                  Corporation
*3.2              Code of Regulations of Home City Financial
                  Corporation
*5                Opinion of Vorys, Sater, Seymour and Pease regarding
                  legality of securities being offered
*8                Opinion of Vorys, Sater, Seymour and Pease regarding
                  tax matters
*10.1             Home City Financial Corporation 1996 Stock Option
                  Plan (proposed)
*10.2             Home City Financial Corporation Recognition and
                  Retention Plan (proposed)
 10.3              Home City Financial Corporation Employee Stock
                  Ownership Plan (proposed)
*10.4             Employment Agreement with Douglas L. Ulery (proposed)
*10.5             Tax Sharing Agreement (proposed)
*10.6             Management Services Agreement (proposed)
 23.1             Consent of Robb, Dixon, Francis, Davis, Oneson &
                  Company
*23.2             Consent of Keller & Company, Inc.
*23.3             Consent of Vorys, Sater, Seymour and Pease
*27               Financial Data Schedule
 99.1             Summary Proxy Statement
 99.2             Order Form and Form of Certification
*99.3             Form of Proxy
*99.4             Solicitation and Marketing Material
*99.5             Appraisal Agreement with Keller & Company, Inc.
 99.6             Appraisal Report prepared by Keller & Company, Inc.


* Previously filed

(B) FINANCIAL STATEMENT SCHEDULES

No financial statement schedules are filed because the required information is not applicable or is included in the consolidated financial statements or related notes.

II-6


ITEM 17. UNDERTAKINGS.

(a) The undersigned, HCFC, hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:

(i) To include any prospectus required by Section 10(a)(3) of the Act;

(ii) To reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement;

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement.

(2) That, for the purpose of determining any liability under the Act, each such post-effective amendment shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(b) Insofar as indemnification for liabilities arising under the Act may be permitted to directors, officers and controlling persons of HCFC, pursuant to the foregoing provisions or otherwise, HCFC has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act, and is therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by HCFC of expenses incurred or paid by a director, officer or controlling person of HCFC in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, HCFC will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

II-7


SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Registration Statement on Form S-1 to be signed on its behalf by the undersigned, duly authorized to do so, in the City of Springfield, State of Ohio, on November 1, 1996.

By: Douglas L. Ulery

Douglas L. Ulery President, Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement on Form S-1 has been signed below by the following persons in the capacities and as of the dates indicated.

Signature                                  Title                                              Date
- ---------                                  -----                                              ----

Douglas L. Ulery                 President, Principal Executive Officer,                November 1, 1996
- ------------------------         Principal Financial Officer, Principal
Douglas L. Ulery                 Accounting Officer and Director


- ------------------------         Director                                               November 1, 1996
John D. Conroy


P. Clark Engelmeier
- ------------------------         Director                                               November 1, 1996
P. Clark Engelmeier


James Foreman
- ------------------------         Director                                               November 1, 1996
James Foreman


Terry A. Hoppes
- ------------------------         Director                                               November 1, 1996
Terry A. Hoppes


EXHIBIT 1.2

HOME CITY FINANCIAL CORPORATION

828,000 Shares

COMMON STOCK

(No Par Value)

Subscription Price $10.00 Per Share

AGENCY AGREEMENT

_______ __, 1996

Charles Webb & Company, a division of
Keefe, Bruyette & Woods, Inc.
211 Bradenton Drive
Dublin, Ohio 43017-5034

Ladies and Gentlemen:

Home City Financial Corporation, an Ohio corporation (the "Company") and Home City Federal Savings Bank of Springfield, Springfield, Ohio, a federally chartered mutual savings bank (references to the "Bank" include the Bank in the mutual or stock form, as indicated by the context), with its deposit accounts insured by the Savings Association Insurance Fund ("SAIF") administered by the Federal Deposit Insurance Corporation ("FDIC")), hereby confirm their agreement with Charles Webb & Company, a division of Keefe, Bruyette & Woods, Inc. ("Webb") or (the "Agent"), as follows:

SECTION 1. THE OFFERING. The Bank, in accordance with its plan of conversion adopted by its Board of Directors (the "Plan"), intends to convert from a federally chartered mutual savings bank to a federally chartered stock savings bank, and will issue all of its issued and outstanding capital stock to the Company. In addition, pursuant to the Plan, the Company will offer and sell up to 828,000 shares of its common stock, no par value per share (the "Shares" or "Common Stock"), in a subscription offering (the "Subscription Offering") to
(1) depositors of the Bank with Qualifying Deposits (as defined in the Bank's Plan of Conversion) as of June 30, 1995 ("Eligible Account Holders"), (2) the Bank's tax-qualified employee plans ("TQEPs"), (3) depositors of the Bank with Qualifying Deposits as of September 30, 1996 ("Supplemental Eligible Account Holders"), (4) the Bank's Other Eligible Members (as defined in the Bank's Plan of Conversion) and (5) employees, officers and directors of the Bank. Subject to the prior subscription rights of the above-listed parties, the Company is offering for sale in a community offering (the "Community Offering" and when referred to together with the Subscription Offering, the "Subscription and Community Offering") conducted concurrently with the Subscription Offering, the Shares not so subscribed for or ordered in the Subscription Offering to members of the general public to whom a copy of the Prospectus (as hereinafter defined) is


delivered ("Other Subscribers") (all such offerees being referred to in the aggregate as "Eligible Offerees"). It is anticipated that shares not subscribed for in the Subscription and Community Offering will be offered to certain members of the general public on a best efforts basis through a selected dealers arrangement (the "Syndicated Community Offering") (the Subscription Offering, Community Offering and Syndicated Community Offering are collectively referred to as the "Offering"). It is acknowledged that the purchase of Shares in the Offering is subject to the maximum and minimum purchase limitations as described in the Plan and that the Company and the Bank may reject, in whole or in part, any orders received in the Community Offering or Syndicated Community Offering. Collectively, these transactions are referred to herein as the "Conversion."

The Company has filed with the Securities and Exchange Commission (the "Commission") a registration statement on Form S-1 (File No. ________) (the "Registration Statement") containing a prospectus relating to the Offering for the registration of the Shares under the Securities Act of 1933 (the "1933 Act"), and has filed such amendments thereof and such amended prospectuses as may have been required to the date hereof. The term "Registration Statement" shall include any documents incorporated by reference therein and all financial schedules and exhibits thereto, as amended, including post-effective amendments. The prospectus, as amended, on file with the Commission at the time the Registration Statement initially became effective is hereinafter called the "Prospectus," except that if any Prospectus is filed by the Company pursuant to Rule 424(b) or (c) of the rules and regulations of the Commission under the 1933 Act (the "1933 Act Regulations") differing from the prospectus on file at the time the Registration Statement initially becomes effective, the term "Prospectus" shall refer to the prospectus filed pursuant to Rule 424(b) or (c) from and after the time said prospectus is filed with the Commission.

In accordance with Title 12, Part 563b of the Code of Federal Regulations (the "Conversion Regulations"), the Bank has filed with the Office of Thrift Supervision (the "OTS") an Application for Approval of Conversion on Form AC (the "Conversion Application"), including the Prospectus and the Conversion Valuation Appraisal Report prepared by Keller & Company (the "Appraisal") and has filed such amendments thereto as may have been required by the OTS. The Conversion Application has been approved by the OTS and the related Prospectus has been authorized for use by the OTS. In addition, the Company has filed with the OTS its application on Form H-(e)1-S (the "Holding Company Application") to become a registered savings and loan holding company under the Home Owners' Loan Act, as amended ("HOLA"); and it has been approved.

SECTION 2. RETENTION OF AGENT; COMPENSATION; SALE AND DELIVERY OF THE SHARES. Subject to the terms and conditions herein set forth, the Company and the Bank hereby appoint Webb as their exclusive financial advisor and marketing agent (i) to utilize its best efforts to solicit subscriptions for Shares of the Company's Common Stock and to advise and assist the Company and the Bank with

2

respect to the Company's sale of the Shares in the Offering and (ii) to participate in the Offering in the areas of market making, research coverage and in syndicate formation (if necessary).

On the basis of the representations, warranties, and agreements herein contained, but subject to the terms and conditions herein set forth, the Agent accepts such appointment and agrees to consult with and advise the Company and the Bank as to the matters set forth in the letter agreement ("Letter Agreement"), dated August 2, 1996 between the Bank and Webb (a copy of which is attached hereto as Exhibit A). It is acknowledged by the Company and the Bank that the Agent shall not be required to purchase any Shares or be obligated to take any action which is inconsistent with all applicable laws, regulations, decisions or orders.

The obligations of the Agent pursuant to this Agreement (other than those set forth in Sections 2(d) and (e) hereof) shall terminate upon the completion or termination or abandonment of the Plan by the Company or upon termination of the Offering, but in no event later than 45 days after the completion of the Subscription Offering (the "End Date"). All fees or expenses due to the Agent but unpaid will be payable to the Agent in next day funds at the earlier of the Closing Date (as hereinafter defined) or the End Date. In the event the Offering is extended beyond the End Date, the Company, the Bank and the Agent may agree to renew this Agreement under mutually acceptable terms.

In the event the Company is unable to sell a minimum of 612,000 Shares within the period herein provided, this Agreement shall terminate and the Company shall refund to any persons who have subscribed for any of the Shares, the full amount which it may have received from them plus accrued interest as set forth in the Prospectus; and none of the parties to this Agreement shall have any obligation to the other parties hereunder, except as set forth in this
Section 2 and in Sections 6, 8 and 9 hereof.

In the event the Offering is terminated for any reason not attributable to the action or inaction of the Agent, the Agent shall be paid the fees due to the date of such termination pursuant to subparagraphs (a) and (d) below.

If all conditions precedent to the consummation of the Conversion, including, without limitation, the sale of all Shares required by the Plan to be sold, are satisfied, the Company agrees to issue, or have issued, the Shares sold in the Offering and to release for delivery certificates for such Shares on the Closing Date (as hereinafter defined) against payment to the Company by any means authorized by the Plan; provided, however, that no funds shall be released to the Company until the conditions specified in Section 7 hereof shall have been complied with to the reasonable satisfaction of the Agent and their counsel. The release of Shares against payment therefor shall be made at 10:00
a.m., Eastern Time, on a date and at a place acceptable to the Company, the Bank and the Agent (it being understood that such date shall not be more than 10 business days after the expiration of the Offering) or such

3

other time or place as shall be agreed upon by the Company, the Bank and the Agent. Certificates for shares shall be delivered directly to the purchasers in accordance with their directions. The date upon which the Company shall release or deliver the Shares sold in the Offering, in accordance with the terms herein, is called the "Closing Date."

The Agent shall receive the following compensation for its services hereunder:

(a) A management fee of $25,000 payable on August 2, 1996. Such fees shall be deemed to have been earned when due. Should the Conversion be terminated for any reason not attributable to the action or inaction of the Agent, the Agent shall have earned and be entitled to be paid fees accruing through the stage at which point the termination occurred, including any accrued legal fees expended by the Agent.

(b) A Success Fee of 1.50% of the aggregate Purchase Price of Common Stock sold in the Subscription Offering and Community Offering excluding shares purchased by the Bank's officers, directors, or employees (or members of their immediate families) plus any ESOP, tax-qualified or stock based compensation plans (except IRA's) or similar plan created by the Bank for some or all of its directors or employees.

(c) If any shares of the Company's stock remain available after the subscription offering, at the request of the Bank, Webb will seek to form a syndicate of registered broker-dealers to assist in the sale of such common stock on a best efforts basis, subject to the terms and conditions set forth in the selected dealers agreement. Webb will endeavor to distribute the common stock among dealers in a fashion which best meets the distribution objectives of the Bank and the Plan of Conversion. Webb will be paid a fee not to exceed 5.5% of the aggregate Purchase Price of the shares of common stock sold by them. Webb will pass onto selected broker-dealers, who assist in the syndicated community, an amount competitive with gross underwriting discounts charged at such time for comparable amounts of stock sold a comparable price per share in a similar market environment. Fees with respect to purchases affected with the assistance of a broker/dealer other than Webb shall be transmitted by Webb to such broker/dealer. The decision to utilize selected broker-dealers will be made by the Bank upon consultation with Webb. In the event, with respect to any stock purchases, fees paid pursuant to this subparagraph 2(c), such fees shall be in lieu of, and not in addition to, payment pursuant to subparagraph 2(a) and 2(b).

4

(d) The Bank and the Company hereby agree to reimburse the Agent, from time to time upon the Agent's request, for its reasonable out-of-pocket expenses, including without limitation, accounting, legal counsel, and communication, excluding travel expenses. The Bank will bear the expenses of the Offering customarily borne by issuers including, without limitation, OTS, SEC, "Blue Sky," and NASD filings and registration fees; the fees of the Bank's accountants, conversion agent, attorneys, appraiser, transfer agent and registrar, printing, mailing and marketing expenses associated with the conversion; and the fees set forth under this Section 2.

Full payment of Agent's actual and accountable expenses, advisory fees and compensation shall be made in next day funds on the earlier of the Closing Date or a determination by the Bank to terminate or abandon the Plan.

SECTION 3. PROSPECTUS; OFFERING. The Shares are to be initially offered in the Offering at the Purchase Price as defined and set forth on the cover page of the Prospectus.

SECTION 4. REPRESENTATIONS AND WARRANTIES. The Company and the Bank jointly and severally represent and warrant to and agree with each of the Agent as follows:

(a) The Registration Statement which was prepared by the Company and the Bank and filed with the Commission was declared effective by the Commission on __________, 1996. At the time the Registration Statement, including the Prospectus contained therein (including any amendment or supplement), became effective, the Registration Statement contained all statements that were required to be stated therein in accordance with the 1933 Act and the 1933 Act Regulations, complied in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations and the Registration Statement, including the Prospectus contained therein (including any amendment or supplement thereto), and any information regarding the Company or the Bank contained in Sales Information (as such term is defined in Section 8 hereof) authorized by the Company or the Bank for use in connection with the Offering, did not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, and at the time any Rule 424(b) or (c) Prospectus was filed with the Commission and at the Closing Date referred to in Section 2, the Registration Statement, including the Prospectus contained therein (including any amendment or supplement thereto), any information regarding the

5

Company or the Bank contained in Sales Information (as such term is defined in Section 8 hereof) authorized by the Company or the Bank for use in connection with the Offering will contain all statements that are required to be stated herein in accordance with the 1933 Act and the 1933 Act Regulations and will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; provided, however, that the representations and warranties in this Section 4(a) shall not apply to statements or omissions made in reliance upon and in conformity with written information furnished to the Company or the Bank by the Agent or its counsel expressly regarding the Agent for use in the Prospectus under the caption "The Conversion-Marketing Arrangements" or statements in or omissions from any Sales Information or information filed pursuant to state securities or blue sky laws or regulations regarding the Agent.

(b) The Conversion Application was approved by the OTS on __________, 1996 and the related Prospectus has been authorized for use by the OTS. At the time of the approval of the Conversion Application, including the Prospectus (including any amendment or supplement thereto), by the OTS and at all times subsequent thereto until the Closing Date, the Conversion Application, including the Prospectus (including any amendment or supplement thereto), will comply in all material respects with the Conversion Regulations except to the extent waived in writing by the OTS. The Conversion Application, including the Prospectus (including any amendment or supplement thereto), does not include any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; provided, however, that the representations and warranties in this Section 4(b) shall not apply to statements or omissions made in reliance upon and in conformity with written information furnished to the Company or the Bank by the Agent or its counsel expressly regarding the Agent for use in the Prospectus contained in the Conversion Application under the caption "The Conversion-" or statements in or omissions from any sales information or information filed pursuant to state securities or blue sky laws or regulations regarding the Agent. The Holding Company Application for approval pursuant to the HOLA and the regulations promulgated thereunder (the

6

"Control Act Regulations"), has been prepared by the Bank and the Company in material conformity with the requirements of the Control Act Regulations and has been filed with and approved by the OTS. A conformed copy of the Holding Company Application has been delivered to the Agent.

(c) The Company has filed with the OTS the Holding Company Application, and such Application was deemed complete by the OTS. As of the Closing Date, approval of the Company's acquisition of the Bank had been obtained from the OTS.

(d) No order has been issued by the OTS or the FDIC (hereinafter any reference to the FDIC shall include the SAIF) preventing or suspending the use of the Prospectus, and no action by or before any such government entity to revoke any approval, authorization or order of effectiveness related to the Conversion is, to the best knowledge of the Company or the Bank, pending or threatened.

(e) At the Closing Date referred to in Section 2, the Plan will have been adopted by the Boards of Directors of both the Company and the Bank and approved by the members of the Bank, and the offer and sale of the Shares will have been conducted in all material respects in accordance with the Plan, the Conversion Regulations, and all other applicable laws, regulations, decisions and orders, including all terms, conditions, requirements and provisions precedent to the Conversion imposed upon the Company or the Bank by the OTS, the Commission, or any other regulatory authority and in the manner described in the Prospectus. No person has sought to obtain review of the final action of the OTS in approving the Plan or in approving the Conversion or the Holding Company Application pursuant to the HOLA, or any other statute or regulation.

(f) The Bank has been organized and is a validly existing federally chartered savings bank in mutual form of organization and upon the Conversion will become a duly organized and validly existing federally chartered savings bank in capital stock form of organization, in both instances duly authorized to conduct its business and own its property as described in the Registration Statement and the Prospectus; the Bank has obtained all material licenses, permits and other governmental authorizations currently required for the conduct of its business; all such licenses, permits and governmental authorizations are in full force and effect, and the Bank is in all material respects complying with all laws, rules, regulations and

7

orders applicable to the operation of its business; the Bank is existing under the laws of the federal government and is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction in which its ownership of property or leasing of property or the conduct of its business requires such qualification, unless the failure to be so qualified in one or more of such jurisdictions would not have a material adverse effect on the condition, financial or otherwise, or the business, operations or income of the Bank. The Bank does not own equity securities or any equity interest in any other business enterprise except as described in the Prospectus or as would not be material to the operations of the Bank. Upon completion of the sale by the Company of the Shares contemplated by the Prospectus, (i) the Bank will be converted pursuant to the Plan to a federally chartered stock savings bank, (ii) all of the authorized and outstanding capital stock of the Bank will be owned by the Company, and (iii) the Company will have no direct subsidiaries other than the Bank. The Conversion will have been effected in all material respects in accordance with all applicable statutes, regulations, decisions and orders; and, except with respect to the filing of certain post-sale, post-Conversion reports, and documents in compliance with the 1933 Act Regulations, the OTS' resolutions or letters of approval, all terms, conditions, requirements and provisions with respect to the Conversion imposed by the Commission, the OTS, and the FDIC, if any, will have been complied with by the Company and the Bank in all material respects or appropriate waivers will have been obtained and all material notice and waiting periods will have been satisfied, waived or elapsed.

(g) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Ohio with corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement and the Prospectus, and at the Closing Date the Company will be qualified to do business as a foreign corporation in each jurisdiction in which the conduct of its business requires such qualification, except where the failure to so qualify would not have a material adverse effect on the condition, financial or otherwise, or the business, operations or income of the Company. The Company has obtained all material licenses, permits and other governmental authorizations currently required for the conduct

8

of its business; all such licenses, permits and governmental authorizations are in full force and effect, and the Company is in all material respects complying with all laws, rules, regulations and orders applicable to the operation of its business.

(h) The Bank has one wholly owned subsidiary, Homciti Service Corp, which is duly incorporated and validly existing as a corporation in good standing under the laws of the State of Ohio, and is duly licensed and possessed of full corporate power and authority to own its properties and conduct its business as described in the Prospectus.

(i) The Bank is a member of the Federal Home Loan Bank of Chicago ("FHLB-Chicago"). The deposit accounts of the Bank are insured by the FDIC up to the applicable limits; and no proceedings for the termination or revocation of such insurance are pending or, to the best knowledge of the Company or the Bank, threatened. Upon consummation of the Conversion, the liquidation account for the benefit of Eligible Account Holders will be duly established in accordance with the requirements of the Conversion Regulations.

(j) The Company, the Bank and its subsidiaries have good and marketable title to all real property and other assets material to the business of the Company and the Bank taken as a whole and to those properties and assets described in the Registration Statement and Prospectus as owned by them, free and clear of all liens, charges, encumbrances or restrictions, except such as are described in the Registration Statement and Prospectus, or are not material to the business of the Company and the Bank taken as a whole; and all of the leases and subleases material to the business of the Company and the Bank taken as a whole under which the Company or the Bank hold properties, including those described in the Registration Statement and Prospectus, are in full force and effect.

(k) The Company and the Bank have received an opinion of their special counsel, Vorys, Sater, Seymour and Pease with respect to the federal and Ohio state income tax consequences of the Conversion, the acquisition of the capital stock of the Bank by the Company and the sale of the Shares as described in the Registration Statement and the Prospectus, all material aspects of the opinions of Vorys, Sater, Seymour and Pease are accurately summarized in the Prospectus; and the facts and representations upon which such opinions are based are truthful, accurate and complete.

9

(l) The Company and the Bank have all such power, authority, authorizations, approvals and orders as may be required to enter into this Agreement, to carry out the provisions and conditions hereof and to issue and sell the Shares to be sold by the Company as provided herein and as described in the Prospectus. The consummation of the Conversion, the execution, delivery and performance of this Agreement and the consummation of the transactions herein contemplated have been duly and validly authorized by all necessary corporate action on the part of the Company and the Bank and this Agreement has been validly executed and delivered by the Company and the Bank and is the valid, legal and binding agreement of the Company and the Bank enforceable in accordance with its terms (except as the enforceability thereof may be limited by bankruptcy, insolvency, moratorium, reorganization or similar laws relating to or affecting the enforcement of creditors' rights generally or the rights of creditors of savings and loan holding companies, the accounts of whose subsidiaries are insured by the FDIC or by general equity principles regardless of whether such enforceability is considered in a proceeding in equity or at law, and except to the extent if any, that the provisions of Sections 8 and 9 hereof may be unenforceable as against public policy).

(m) The Company and the Bank are not in violation of any directive received from the OTS, the FDIC, or any other agency to make any material change in the method of conducting their businesses so as to comply in all material respects with all applicable statutes and regulations (including, without limitation, regulations, decisions, directives and orders of the OTS, and the FDIC) and, except as may be set forth in the Registration Statement and the Prospectus, there is no suit or proceeding or charge or action before or by any court, regulatory authority or governmental agency or body, pending or, to the knowledge of the Company or the Bank, threatened, which might materially and adversely affect the Conversion, the performance of this Agreement or the consummation of the transactions contemplated in the Plan and as described in the Registration Statement and the Prospectus or which might result in any material adverse change in the condition (financial or otherwise), earnings, capital or properties of the Company or the Bank, or which would materially affect their properties and assets.

10

(n) The financial statements, schedules and notes related thereto which are included in the Prospectus fairly present the consolidated financial condition, results of operations, retained earnings and cash flows of the Bank at the respective dates indicated and for the respective periods covered thereby and comply as to form in all material respects with the applicable accounting requirements of Title 12 of the Code of Federal Regulations and generally accepted accounting principles (including those requiring the recording of certain assets at their current market value). Such financial statements, schedules and notes related thereto have been prepared in accordance with generally accepted accounting principles consistently applied through the periods involved, present fairly in all material respects the information required to be stated therein and are consistent with the most recent financial statements and other reports filed by the Bank with the OTS. The other financial, statistical and pro forma information and related notes included in the Prospectus present fairly the information shown therein on a basis consistent with the audited and unaudited financial statements of the Bank included in the Prospectus, and as to the pro forma adjustments, the adjustments made therein have been properly applied on the basis described therein.

(o) Since the respective dates as of which information is given in the Registration Statement including the Prospectus: (i) there has not been any material adverse change, financial or otherwise, in the condition of the Company or the Bank and its subsidiaries considered as one enterprise, or in the earnings, capital or properties of the Company or the Bank, whether or not arising in the ordinary course of business; (ii) there has not been any material increase in the long-term debt of the Bank or in the principal amount of the Bank's assets which are classified by the Bank as substandard, doubtful or loss or in loans past due 90 days or more or real estate acquired by foreclosure, by deed-in-lieu of foreclosure or deemed in-substance foreclosure or any material decrease in retained earnings or total assets of the Bank nor has the Company or the Bank issued any securities (other than in connection with the incorporation of the Company) or incurred any liability or obligation for borrowing other than in the ordinary course of business; (iii) there have not been any material transactions entered into by the Company or the Bank; (iv) there has not been any material adverse change in the aggregate dollar amount of the Bank's

11

deposits or its consolidated net worth or spread; (v) there has been no material adverse change in the Company's or the Bank's relationship with its insurance carriers, including, without limitation, cancellation or other termination of the Company's or the Bank's fidelity bond or any other type of insurance coverage; (vi) except as disclosed in the Prospectus there has been no material change in management of the Company or the Bank, neither of which has any material undisclosed liability of any kind, contingent or otherwise; (vii) the Company or the Bank has not sustained any material loss or interference with its respective business or properties from fire, flood, windstorm, earthquake, accident or other calamity, whether or not covered by insurance; (viii) the Company or the Bank is not in default in the payment of principal or interest on any outstanding debt obligations;
(ix) the capitalization, liabilities, assets, properties and business of the Company, the Mutual Holding Company and the Bank conform in all material respects to the descriptions thereof contained in the Prospectus; and (x) neither the Company, the Bank nor its wholly owned subsidiary has any material contingent liabilities, except as set forth in the Prospectus. All documents made available to or delivered or to be made available to or delivered by the Bank or the Company or their representatives in connection with the issuance and sale of the Shares, including records of account holders, depositors, borrowers and other members of the Bank, or in connection with the Agent's exercise of due diligence, except for those documents which were prepared by parties other than the Bank, the Company or their representatives, to the best knowledge of the Bank and the Company, were on the dates on which they were delivered, or will be on the dates on which they are to be delivered, true, complete and correct in all material respects.

(p) As of the date hereof and as of the Closing Date, neither the Company, the Bank nor its subsidiary is in violation of its articles of incorporation or bylaws or charter or bylaws, respectively (and the Bank will not be in violation of its charter or bylaws in capital stock form upon consummation of the Conversion), or in default in the performance or observance of any material obligation, agreement, covenant, or condition contained in any material contract, lease, loan agreement, indenture or other instrument to which it is a party or by which it or any of its property may be bound; the consummation of the Conversion, the execution, delivery and performance of this Agreement and the consummation of the transactions herein

12

contemplated have been duly and validly authorized by all necessary corporate action on the part of the Company and the Bank and this Agreement has been validly executed and delivered by the Company and the Bank and is a valid, legal and binding Agreement of the Company and the Bank enforceable in accordance with its terms, except as the enforceability thereof may be limited by (i) bankruptcy, insolvency, reorganization, moratorium, conservatorship, receivership or other similar laws now or hereafter in effect relating to or affecting the enforcement of creditors' rights generally or the rights of creditors of federal savings institutions, (ii) general equitable principles, (iii) laws relating to the safety and soundness of insured depository institutions, and
(iv) applicable law or public policy with respect to the indemnification and/or contribution provisions contained herein, and except that no representation or warranty need be made as to the effect or availability of equitable remedies or injunctive relief (regardless of whether such enforceability is considered in a proceeding in equity or at law). The consummation of the transactions herein contemplated will not:
(i) conflict with or constitute a breach of, or default under, or result in the creation of any material lien, charge or encumbrance (with the exception of the liquidation account established in the Conversion) upon any of the assets of the Company or the Bank pursuant to the articles of incorporation and bylaws of the Company or the charter and bylaws of the Bank (in either mutual or capital stock form), or any material contract, lease or other instrument to which the Company or the Bank has a beneficial interest, or any applicable law, rule, regulation or order; (ii) violate any authorization, approval, judgement, decree, order, statute, rule or regulation applicable to the Company or the Bank, except for such violations which would not have a material adverse effect on the financial condition and results of operations of the Company and the Bank on a consolidated basis; or (iii) with the exception of the liquidation account established in the Conversion, result in the creation of any material lien, charge or encumbrance upon any property of the Company or the Bank.

(q) No default exists, and no event has occurred which with notice or lapse of time, or both, would constitute a default, on the part of the Company, the Bank or its subsidiary in the due performance and observance of any term, covenant or condition of any indenture, mortgage, deed of trust, note, bank loan or credit agreement or any other

13

instrument or agreement to which the Company or the Bank or its subsidiary is a party or by which any of them or any of their property is bound or affected, except such defaults which would not have a material adverse affect on the financial condition or results of operations of the Company, the Bank and its subsidiary on a consolidated basis; such agreements are in full force and effect; and no other party to any such agreements has instituted or, to the best knowledge of the Company, the Bank or its subsidiary, threatened any action or proceeding wherein the Company, the Bank or its subsidiary would or might be alleged to be in default thereunder.

(r) Upon consummation of the Conversion, the authorized, issued and outstanding equity capital of the Company will be within the range set forth in the Prospectus under the caption "Capitalization," and no shares of Common Stock have been or will be issued and outstanding prior to the Closing Date referred to in Section 2 herein (other than in connection with the incorporation of the Company); the Shares will have been duly and validly authorized for issuance and, when issued and delivered by the Company pursuant to the Plan against payment of the consideration calculated as set forth in the Plan and in the Prospectus, will be duly and validly issued, fully paid and non-assessable; no preemptive rights exist with respect to the Shares; and the terms and provisions of the Shares will conform in all material respects to the description thereof contained in the Registration Statement and the Prospectus. To the best knowledge of the Company and the Bank, upon the issuance of the Shares, good title to the Shares will be transferred from the Company to the purchasers thereof against payment therefor, subject to such claims as may be asserted against the purchasers thereof by third-party claimants.

(s) No approval of any regulatory or supervisory or other public authority is required in connection with the execution and delivery of this Agreement or the issuance of the Shares, except for the approval of the Commission, the OTS, and any necessary qualification, notification, registration or exemption under the securities or blue sky laws of the various states in which the Shares are to be offered, and except as may be required under the rules and regulations of the NASD and/or the National Association of Securities Dealers Automated Quotation ("Nasdaq") Stock Market.

14

(t) Robb, Dixon, Francis, Davis, Oneson & Company, which has certified the consolidated audited financial statements and schedules of the Bank included in the Prospectus, has advised the Company and the Bank in writing that they are, with respect to the Company and the Bank, independent public accountants within the meaning of the Code of Professional Ethics of the American Institute of Certified Public Accountants and Title 12 of the Code of Federal Regulations and Section 571.2(c)(3).

(u) Keller & Company, which has prepared the Bank's Conversion Valuation Appraisal Report as of ____________, 1996 (as amended or supplemented, if so amended or supplemented) (the "Appraisal"), has advised the Company in writing that it is independent of the Company and the Bank within the meaning of the Conversion Regulations.

(v) The Company, the Bank and its subsidiary have timely filed all required federal, state and local tax returns; the Company, the Bank and its subsidiary have paid all taxes that have become due and payable in respect of such returns, except where permitted to be extended, have made adequate reserves for similar future tax liabilities and no deficiency has been asserted with respect thereto by any taxing authority.

(w) The Bank is in compliance in all material respects with the applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, and the regulations and rules thereunder.

(x) To the knowledge of the Company and the Bank, neither the Company, the Bank nor employees of the Company or the Bank have made any payment of funds of the Company or the Bank as a loan for the purchase of the Shares or made any other payment of funds prohibited by law, and no funds have been set aside to be used for any payment prohibited by law.

(y) Prior to the Conversion, neither the Company nor the Bank has:
(i) issued any securities within the last 18 months (except for notes to evidence other bank loans and reverse repurchase agreements or other liabilities in the ordinary course of business or as described in the Prospectus, and except for any shares issued in connection with the incorporation of the Company); (ii) had any material dealings within the 12 months prior to the date hereof with any member of the NASD, or any person related to or associated with such member,

15

other than discussions and meetings relating to the proposed Offering and routine purchases and sales of United States government and agency securities; (iii) entered into a financial or management consulting agreement except as contemplated hereunder; and (iv) engaged any intermediary between the Agent and the Company and the Bank in connection with the offering of the Shares, and no person is being compensated in any manner for such service. Appropriate arrangements have been made for placing the funds received from subscriptions for Shares in a special interest-bearing account with the Bank until all Shares are sold and paid for, with provision for refund to the purchasers in the event that the Conversion is not completed for whatever reason or for delivery to the Company if all Shares are sold.

(z) The Company and the Bank have not relied upon the Agent or its legal counsel or other advisors for any legal, tax or accounting advice in connection with the Conversion.

(aa) The Company is not required to be registered under the Investment Company Act of 1940, as amended.

(bb) Any certificates signed by an officer of the Company or the Bank pursuant to the conditions of this Agreement and delivered to the Agent or their counsel that refers to this Agreement shall be deemed to be a representation and warranty by the Company or the Bank to the Agent as to the matters covered thereby with the same effect as if such representation and warranty were set forth herein.

SECTION 5. REPRESENTATIONS AND WARRANTIES.

Webb represents and warrants to the Company and the Bank that:

(i) Webb is a corporation and is validly existing in good standing under the laws of the State of Ohio with full power and authority to provide the services to be furnished to the Bank and the Company hereunder.

(ii) The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly and validly authorized by all necessary action on the part of Webb, and this Agreement has been duly and validly executed and delivered by Webb and is a legal, valid and binding agreement of Webb, enforceable in accordance with its terms.

(iii) Each of Webb and its employees, agent and representatives who shall perform any of the services hereunder shall be duly authorized and empowered, and

16

shall have all licenses, approvals and permits necessary to perform such services.

(iv) The execution and delivery of this Agreement by Webb, the consummation of the transactions contemplated hereby and compliance with the terms and provisions hereof will not conflict with, or result in a breach of, any of the terms, provisions or conditions of, or constitute a default (or an event which with notice or lapse of time or both would constitute a default) under, the articles of incorporation of Webb or any agreement, indenture or other instrument to which Webb is a party or by which it or its property is bound.

(v) No approval of any regulatory or supervisory or other public authority is required in connection with Webb's execution and delivery of this Agreement, except as may have been received.

(vi) There is no suit or proceeding or charge or action before or by any court, regulatory authority or government agency or body or, to the knowledge of Webb, pending or threatened, which might materially adversely affect Webb's performance of this Agreement.

SECTION 5.1 COVENANTS OF THE COMPANY AND THE BANK. The Company and the Bank hereby jointly and severally covenant with each of the Agent as follows:

(a) The Company has filed the Registration Statement with the Commission. The Company will not, at any time after the date the Registration Statement is declared effective, file any amendment or supplement to the Registration Statement without providing the Agent and its counsel an opportunity to review such amendment or supplement or file any amendment or supplement to which amendment or supplement the Agent or its counsel shall reasonably object.

(b) The Bank has filed the Conversion Application with the OTS. The Bank will not, at any time after the Conversion Application is approved by, the OTS, file any amendment or supplement to such Conversion Application without providing the Agent and its counsel an opportunity to review such amendment or supplement or file any amendment or supplement to which amendment or supplement the Agent or its counsel shall reasonably object.

(c) The Company has filed the Holding Company Application with the OTS. The Company will not, at any time before the Holding Company Application is approved by the OTS, file any amendment or

17

supplement to such Holding Company Application without providing the Agent and its counsel an opportunity to review the nonconfidential portions of such amendment or supplement or file any amendment or supplement to which amendment or supplement the Agent or its counsel shall reasonably object.

(d) The Company and the Bank will use their best efforts to cause any post-effective amendment to the Registration Statement to be declared effective by the Commission and any post-effective amendment to the Conversion Application to be approved by the OTS and will immediately upon receipt of any information concerning the events listed below notify the Agent: (i) when the Registration Statement, as amended, has become effective;
(ii) when the Conversion Application, as amended, has been approved by the OTS; (iii) any comments from the Commission, the OTS or any other governmental entity with respect to the Conversion or the transactions contemplated by this Agreement;
(iv) of the request by the Commission, the OTS or any other governmental entity for any amendment or supplement to the Registration Statement, the Conversion Application or for additional information; (v) of the issuance by the Commission, the OTS or any other governmental entity of any order or other action suspending the Offering or the use of the Registration Statement or the Prospectus or any other filing of the Company or the Bank under the Conversion Regulations, or other applicable law, or the threat of any such action; (vi) the issuance by the Commission, the OTS or any authority of any stop order suspending the effectiveness of the Registration Statement or of the initiation or threat of initiation or threat of any proceedings for that purpose; or (vii) of the occurrence of any event mentioned in paragraph (h) below. The Company and the Bank will make every reasonable effort (i) to prevent the issuance by the Commission, the OTS or any state authority of any such order and, if any such order shall at any time be issued, (ii) to obtain the lifting thereof at the earliest possible time.

(e) The Company and the Bank will deliver to the Agent and to its counsel two conformed copies of the Registration Statement, the Conversion Application and the Holding Company Application, as originally filed and of each amendment or supplement thereto, including all exhibits. Further, the Company and the Bank will deliver such additional copies of the foregoing documents to counsel to the Agent as may be required for any NASD and "blue sky" filings.

18

(f) The Company and the Bank will furnish to the Agent, from time to time during the period when the Prospectus (or any later prospectus related to this offering) is required to be delivered under the 1933 Act or the Securities Exchange Act of 1934 (the "1934 Act"), such number of copies of such Prospectus (as amended or supplemented) as the Agent may reasonably request for the purposes contemplated by the 1933 Act, the 1933 Act Regulations, the 1934 Act or the rules and regulations promulgated under the 1934 Act (the "1934 Act Regulations"). The Company authorizes the Agent to use the Prospectus (as amended or supplemented, if amended or supplemented) in any lawful manner contemplated by the Plan in connection with the sale of the Shares by the Agent.

(g) The Company and the Bank will comply with any and all material terms, conditions, requirements and provisions with respect to the Conversion and the transactions contemplated thereby imposed by the Commission, the OTS or the Conversion Regulations, and by the 1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934 Act Regulations to be complied with prior to or subsequent to the Closing Date and when the Prospectus is required to be delivered, and during such time period the Company and the Bank will comply, at their own expense, with all material requirements imposed upon them by the Commission, the OTS or the Conversion Regulations, and by the 1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934 Act Regulations, including, without limitation, Rule 10b-5 under the 1934 Act, in each case as from time to time in force, so far as necessary to permit the continuance of sales or dealing in shares of Common Stock during such period in accordance with the provisions hereof and the Prospectus.

(h) If, at any time during the period when the Prospectus relating to the Shares is required to be delivered, any event relating to or affecting the Company, the Bank or its subsidiary shall occur, as a result of which it is necessary or appropriate, in the opinion of counsel for the Company and the Bank or in the reasonable opinion of the Agent's counsel, to amend or supplement the Registration Statement or Prospectus in order to make the Registration Statement or Prospectus not misleading in light of the circumstances existing at the time the Prospectus is delivered to a purchaser, the Company and the Bank will immediately so inform the Agent and prepare and file, at their own expense, with the Commission and the OTS and furnish to the

19

Agent a reasonable number of copies of an amendment or amendments of, or a supplement or supplements to, the Registration Statement or Prospectus (in form and substance reasonably satisfactory to the Agent and its counsel after a reasonable time for review) which will amend or supplement the Registration Statement or Prospectus so that as amended or supplemented it will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances existing at the time the Prospectus is delivered to a purchaser, not misleading. For the purpose of this Agreement, the Company and the Bank each will timely furnish to the Agent such information with respect to itself as the Agent may from time to time reasonably request.

(i) The Company and the Bank will take all necessary actions, in cooperating with the Agent, and furnish to whomever the Agent may direct, such information as may be required to qualify or register the Shares for offering and sale by the Company or to exempt such Shares from registration, or to exempt the Company as a broker-dealer and its officers, directors and employees as broker-dealers or agent under the applicable securities or blue sky laws of such jurisdictions in which the Shares are required under the Conversion Regulations to be sold or as the Agent and the Company and the Bank may reasonably agree upon; provided, however, that the Company shall not be obligated to file any general consent to service of process, to qualify to do business in any jurisdiction in which it is not so qualified, or to register its directors or officers as brokers, dealers, salesmen or agent in any jurisdiction. In each jurisdiction where any of the Shares shall have been qualified or registered as above provided, the Company will make and file such statements and reports in each fiscal period as are or may be required by the laws of such jurisdiction.

(j) The liquidation account for the benefit of Eligible Account Holders and Supplemental Eligible Account Holders will be duly established and maintained in accordance with the requirements of the OTS, and such Eligible Account Holders and Supplemental Eligible Account Holders who continue to maintain their savings accounts in the Bank will have an inchoate interest in their pro rata portion of the liquidation account which shall have a priority superior to that of the holders of shares of Common Stock in the event of a complete liquidation of the Bank.

20

(k) The Company and the Bank will not sell or issue, contract to sell or otherwise dispose of, for a period of 90 days after the Closing Date, without the Agent's prior written consent, any shares of Common Stock other than the Shares or other than in connection with any plan or arrangement described in the Prospectus, including existing stock benefit plans.

(l) The Company shall register its Common Stock under Section 12(g) of the 1934 Act concurrent with the Offering pursuant to the Plan and shall request that such registration be effective upon completion of the Conversion. The Company shall maintain the effectiveness of such registration for not less than three years or such shorter period as may be required by the OTS.

(m) During the period during which the Company's Common Stock is registered under the 1934 Act or for three (3) years from the date hereof, whichever period is greater, the Company will furnish to its stockholders as soon as practicable after the end of each fiscal year an annual report of the Company (including a consolidated balance sheet and statements of consolidated income, stockholders' equity and cash flows of the Company and its subsidiaries as at the end of and for such year, certified by independent public accountants in accordance with Regulation S-X under the 1933 Act and the 1934 Act).

(n) During the period of three years from the date hereof, the Company will furnish to the Agent: (i) as soon as practicable after such information is publicly available, a copy of each report of the Company furnished to or filed with the Commission under the 1934 Act or any national securities exchange or system on which any class of securities of the Company is listed or quoted (including, but not limited to, reports on Forms 10-K, 10-Q and 8-K and all proxy statements and annual reports to stockholders), (ii) a copy of each other non-confidential report of the Company mailed to its stockholders or filed with the Commission, the OTS or any other supervisory or regulatory authority or any national securities exchange or system on which any class of securities of the Company is listed or quoted, each press release and material news items and additional documents and information with respect to the Company or the Bank as the Agent may reasonably request; and (iii) from time to time, such other nonconfidential information concerning the Company or the Bank as the Agent may reasonably request.

21

(o) The Company and the Bank will use the net proceeds from the sale of the Shares in the manner set forth in the Prospectus under the caption "Use of Proceeds."

(p) Other than as permitted by the Conversion Regulations, the HOLA, the 1933 Act, the 1933 Act Regulations, and the laws of any state in which the Shares are registered or qualified for sale or exempt from registration, neither the Company nor the Bank will distribute any prospectus, offering circular or other offering material in connection with the offer and sale of the Shares.

(q) The Company will use its best efforts to (i) encourage and assist a market maker to establish and maintain a market for the Shares and (ii) list and maintain quotation of the Shares on a national or regional securities exchange or on the Nasdaq Stock Market effective on or prior to the Closing Date.

(r) The Bank will maintain appropriate arrangements for depositing all funds received from persons mailing subscriptions for or orders to purchase Shares in the Offering on an interest-bearing basis at the rate described in the Prospectus until the Closing Date and satisfaction of all conditions precedent to the release of the Bank's obligation to refund payments received from persons subscribing for or ordering Shares in the Offering in accordance with the Plan and as described in the Prospectus or until refunds of such funds have been made to the persons entitled thereto or withdrawal authorizations canceled in accordance with the Plan and as described in the Prospectus. The Bank will maintain such records of all funds received to permit the funds of each subscriber to be separately insured by the FDIC (to the maximum extent allowable) and to enable the Bank to make the appropriate refunds of such funds in the event that such refunds are required to be made in accordance with the Plan and as described in the Prospectus.

(s) The Company will promptly take all necessary action to register as a savings and loan holding company under the HOLA.

(t) The Company and the Bank will take such actions and furnish such information as are reasonably requested by the Agent in order for the Agent to ensure compliance with the NASD's "Interpretation Relating to Free Riding and Withholding."

22

(u) Neither the Company nor the Bank will amend the Plan of Conversion without notifying the Agent prior thereto.

(v) The Company shall assist the Agent, if necessary, in connection with the allocation of the Shares in the event of an oversubscription and shall provide the Agent with any information necessary to assist the Company in allocating the Shares in such event and such information shall be accurate and reliable.

(w) Prior to the Closing Date, the Company and the Bank will inform the Agent of any event or circumstances of which it is aware as a result of which the Registration Statement and/or Prospectus, as then amended or supplemented, would contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading.

(x) Subsequent to the date the Registration Statement is declared effective by the Commission and prior to the Closing Date, except as otherwise may be indicated or contemplated therein or set forth in an amendment or supplement thereto, neither the Company nor the Bank will have: (i) issued any securities or incurred any liability or obligation, direct or contingent, for borrowed money, except borrowings from the same or similar sources indicated in the Prospectus in the ordinary course of its business, or (ii) entered into any transaction which is material in light of the business and properties of the Company and the Bank, taken as a whole.

SECTION 6. PAYMENT OF EXPENSES. Whether or not the Conversion is completed or the sale of the Shares by the Company is consummated, the Company and the Bank jointly and severally agree to pay or reimburse the Agent for: (a) all filing fees in connection with all filings related to the Offering with the NASD; (b) any stock issue or transfer taxes which may be payable with respect to the sale of the Shares; (c) all reasonable expenses of the Conversion, including but not limited to the Company's and the Bank's, and the Agency's attorneys' fees and expenses, blue sky fees, transfer agent, registrar and other agent charges, fees relating to auditing and accounting or other advisors and costs of printing all documents necessary in connection with the Conversion; provided, however, there will be no out-of-pocket expenses charged by the Agent for expenses such as travel, lodging and meals. However, such out-of-pocket expenses do not include expenses incurred with respect to the matters set forth in (a),
(b) or (c) above. In the event the Company is unable to sell a minimum of 612,000 Shares or the Conversion is terminated or otherwise

23

abandoned, the Company and the Bank shall promptly reimburse the Agent in accordance with Section 2 hereof.

SECTION 7. CONDITIONS TO THE AGENT'S OBLIGATIONS. The obligations of the Agent hereunder, as to the Shares to be delivered at the Closing Date, are subject, to the extent not waived in writing by the Agent, to the condition that all representations and warranties of the Company and the Bank herein are, at and as of the commencement of the Offering and at and as of the Closing Date, true and correct in all material respects, the condition that the Company and the Bank shall have performed all of their obligations hereunder to be performed on or before such dates, and to the following further conditions:

(a) At the Closing Date, the Company and the Bank shall have conducted the Conversion in all material respects in accordance with the Plan, the Conversion Regulations, and all other applicable laws, regulations, decisions and orders, including all terms, conditions, requirements and provisions precedent to the Conversion imposed upon them by the OTS.

(b) The Registration Statement shall have been declared effective by the Commission and the Conversion Application approved by the OTS not later than 5:30 p.m. on the date of this Agreement, or with the Agent's consent at a later time and date; and at the Closing Date, no stop order suspending the effectiveness of the Registration Statement shall have been issued under the 1933 Act or proceedings therefore initiated or threatened by the Commission or any state authority, and no order or other action suspending the authorization of the Prospectus or the consummation of the Conversion shall have been issued or proceedings therefore initiated or, to the Company's or the Bank's knowledge, threatened by the Commission, the OTS, the FDIC, or any state authority.

(c) At the Closing Date, the Agent shall have received:

(1) The favorable opinion, dated as of the Closing Date and addressed to the Agent and for its benefit, of Vorys, Sater, Seymour and Pease, special counsel for the Company and the Bank, in form and substance to the effect that:

(i) The Company has been duly incorporated and is validly existing as a corporation under the laws of the State of Ohio.

(ii) The Company has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement and the Prospectus; and the

24

Company is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction listed below in which it owns or leases properties or in which the conduct of its business requires such qualification or in which the conduct of its business upon consummation of the Conversion will require such qualifications, except where the failure so to qualify would not have a material adverse effect on the business assets or financial condition of the Company.

(iii) The Bank has been and is a duly organized and is a validly existing federally chartered savings bank in mutual form and upon the Conversion will become a duly organized and validly existing federally chartered savings bank in capital stock form of organization, in both instances duly authorized to conduct its business and own its property as described in the Registration Statement and the Prospectus. The Bank is in good standing and is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction in which its ownership of property or leasing of property or the conduct of its business requires such qualification, unless the failure to be so qualified in one or more of such jurisdictions would not have a material adverse effect on the condition, financial or otherwise, or the business, operations or income of the Bank. All of the outstanding capital stock of the Bank upon completion of the Conversion will be duly authorized and, upon payment therefor, will be validly issued, fully paid and non-assessable and will be owned by the Company, free and clear of any liens, encumbrances, claims or other restrictions.

(iv) The Bank has one subsidiary, Homciti Service Corp, which is duly incorporated and validly existing as a corporation in good standing under the laws of the State of Ohio, and which has full corporate power and authority to own its own properties and conduct its business as described in the Prospectus; and the subsidiary is duly qualified to do business as a foreign corporation under the laws of Ohio, and is in good standing as such in each jurisdiction in which such qualification is required, except where the failure to so qualify would not have a material adverse effect on the business, assets or financial condition of the Bank on a consolidated basis. The subsidiary holds all licenses, certificates and permits from governmental authorities necessary for the conduct of its business as described in the Prospectus except where the failure to hold such

25

licenses, certificates or permits would not have a material adverse effect on the business, assets or financial condition of the Bank on a consolidated basis; and such subsidiary is not in material violation of its articles of incorporation or bylaws. All of the outstanding stock of the subsidiary has been duly authorized and is validly issued, fully paid and nonassessable, and all such stock is owned directly by the Bank, free and clear of any liens, encumbrances, claims or other restrictions.

(v) The Bank is a member of the FHLB-Chicago. The deposit accounts of the Bank are insured by the FDIC up to the maximum amount allowed under law and no proceedings for the termination or revocation of such insurance are pending or, to such counsel's Actual Knowledge, threatened; the description of the liquidation account as set forth in the Prospectus under the captions "The Conversion-Liquidation Account," to the extent that such information constitutes matters of law and legal conclusions, has been reviewed by such counsel and is accurately described in all material respects.

(vi) Upon consummation of the Conversion, the authorized, issued and outstanding capital stock of the Company will be within the range set forth in the Prospectus under the caption "Capitalization," and, except for shares issued upon incorporation of the Company, no shares of Common Stock have been issued prior to the Closing Date; at the time of the Conversion, the Shares subscribed for pursuant to the Offering will have been duly and validly authorized for issuance, and when issued and delivered by the Company pursuant to the Plan against payment of the consideration calculated as set forth in the Plan and Prospectus, will be duly and validly issued and fully paid and non-assessable; the issuance of the Shares is not subject to preemptive rights and the terms and provisions of the Shares conform in all material respects to the description thereof contained in the Prospectus. To such counsel's Actual Knowledge, upon the issuance of the Shares, good title to the Shares will be transferred from the Company to the purchasers thereof against payment therefor, subject to such claims as may be asserted against the purchasers thereof by third-party claimants.

(vii) The Bank and the Company have full corporate power and authority to enter into the Agreement and to consummate the transactions

26

contemplated thereby and by the Plan of Conversion. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly and validly authorized by all necessary action on the part of the Company and the Bank; and this Agreement is a valid and binding obligation of the Company and the Bank, enforceable in accordance with its terms, except as the enforceability thereof may be limited by (i) bankruptcy, insolvency, reorganization, moratorium, conservatorship, receivership or other similar laws now or hereafter in effect relating to or affecting the enforcement of creditors' rights generally or the rights of creditors of federal savings institutions,
(ii) general equitable principles, (iii) laws relating to the safety and soundness of insured depository institutions, and (iv) applicable law or public policy with respect to the indemnification and/or contribution provisions contained herein, including without limitations the provision of Sections 23A and 23B of the Federal Reserve Act and except that no opinion need to be expressed as to the effect or availability of equitable remedies or injunctive relief (regardless of whether such enforceability is considered in a proceeding in equity or at law).

(viii) The Conversion Application has been approved by the OTS and the Prospectus has been authorized for use by the OTS. The OTS has approved the Holding Company Application and issued its order of approval under the savings and loan holding company provisions of the HOLA, the purchase by the Company of all of the issued and outstanding capital stock of the Bank has been authorized by the OTS and no action has been taken, and to such counsel's Actual Knowledge, none is pending or threatened, to revoke any such authorization or approval.

(ix) The Plan has been duly adopted by the required vote of the directors of the Company and the Bank, and based upon the certificate of the inspector of election, by the members of the Bank.

(x) Subject to the satisfaction of the conditions to the OTS' approval of the Conversion, no further approval, registration, authorization, consent or other order of any federal regulatory agency, is required in connection with the execution and delivery of this Agreement, the issuance of the Shares and the consummation of the Conversion, except as may be required under the securities or blue sky laws of various jurisdictions (as to which no opinion need be

27

rendered) and except as may be required under the rules and regulations of the NASD and/or the Nasdaq Stock Market (as to which no opinion need by rendered). To such counsel's Actual Knowledge, the Conversion has been consummated in all material respects in accordance with all applicable provisions of the HOLA and the Conversion Regulations.

(xi) The Registration Statement is effective under the 1933 Act and no stop order suspending the effectiveness has been issued under the 1933 Act or proceedings therefor initiated or, to such counsel's Actual Knowledge, threatened by the Commission.

(xii) At the time the Conversion Application, including the Prospectus contained therein, was approved by the OTS, the Conversion Application, including the Prospectus contained therein, complied as to form in all material respects with the requirements of the Conversion Regulations, federal law and all applicable rules and regulations promulgated thereunder (other than the financial statements, the notes thereto, and other tabular, financial, statistical and appraisal data included therein, as to which no opinion need be rendered).

(xiii) At the time that the Registration Statement became effective, (i) the Registration Statement (as amended or supplemented, if so amended or supplemented) (other than the financial statements, the notes thereto, and other tabular, financial, statistical and appraisal data included therein, as to which no opinion need be rendered), complied as to form in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations, and (ii) the Prospectus (other than the financial statements, the notes thereto, and other tabular, financial, statistical and appraisal data included therein, as to which no opinion need be rendered) complied as to form in all material respects with the requirements of the 1933 Act, the 1933 Act Regulations, the Conversion Regulations and federal law.

(xiv) The terms and provisions of the Shares of the Company conform, in all material respects, to the description thereof contained in the Registration Statement and Prospectus, and the form of certificate used to evidence the Shares is in due and proper form.

28

(xv) There are no legal or governmental proceedings pending, or to such counsel's Actual Knowledge, threatened which are required to be disclosed in the Registration Statement and Prospectus, other than those disclosed therein, and to such counsel's Actual Knowledge, all pending legal and governmental proceedings to which the Company or the Bank is a party or of which any of their property is the subject, which are not described in the Registration Statement and the Prospectus, including ordinary routine litigation incidental to the Company's or the Bank's business, are, considered in the aggregate, not material.

(xvi) To such counsel's Actual Knowledge, there are no material contracts, indentures, mortgages, loan agreements, notes, leases or other instruments required to be described or referred to in the Conversion Application, the Registration Statement or the Prospectus or required to be filed as exhibits thereto other than those described or referred to therein or filed as exhibits thereto in the Conversion Application, the Registration Statement or the Prospectus. The description in the Conversion Application, the Registration Statement and the Prospectus of such documents and exhibits is accurate in all material respects and fairly presents the information required to be shown.

(xvii) To such counsel's Actual Knowledge, the Company and the Bank have conducted the Conversion, in all material respects, in accordance with all applicable requirements of the Plan and applicable federal law. The Plan complies in all material respects with all applicable federal laws, rules, regulations, decisions and orders including, but not limited to, the Conversion Regulations; no order has been issued by the OTS, the Commission, the FDIC, or any state authority to suspend the Offering or the use of the Prospectus, and no action for such purposes has been instituted or, to such counsel's Actual Knowledge, threatened by the OTS, the Commission, the FDIC, or any state authority and, to such counsel's Actual Knowledge, no person has sought to obtain regulatory or judicial review of the final action of the OTS, approving the Plan, the Conversion Application, the Holding Company Application or the Prospectus.

(xviii) To such counsel's Actual Knowledge, the Company and the Bank have obtained all material licenses, permits and other governmental authorizations currently required for the conduct of their businesses and all such licenses, permits

29

and other governmental authorizations are in full force and effect, and the Company and the Bank are in all material respects complying therewith.

(xix) To such counsel's Actual Knowledge, neither the Company nor the Bank is in violation of its articles of incorporation and bylaws or its Charter and bylaws, as appropriate or, to such counsel's Actual Knowledge, in default or violation of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, loan agreement, note, lease or other instrument to which it is a party or by which it or its property may be bound, except for such defaults or violations which would not have a material adverse impact on the financial condition or results of operations of the Company, the Bank and its subsidiary on a consolidated basis; to such counsel's Actual Knowledge, the execution and delivery of this Agreement, the occurrence of the obligations herein set forth and the consummation of the transactions contemplated herein will not conflict with or constitute a breach of, or default under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or the Bank pursuant to any material contract, indenture, mortgage, loan agreement, note, lease or other instrument to which the Company or the Bank is a party or by which any of them may be bound, or to which any of the property or assets of the Company or the Bank are subject (other than the establishment of the liquidation account); and, such action will not result in any violation of the provisions of the articles of incorporation or bylaws of the Company or the Charter or bylaws of the Bank or, to such counsel's actual knowledge, result in any violation of any applicable federal law, act, regulation need be rendered (except that no opinion with respect to the securities and blue sky laws of various jurisdictions or the rules or regulations of the NASD and/or the Nasdaq Stock Market) or order or court order, writ, injunction or decree.

(xxi) The Company's Articles of Incorporation and bylaws comply in all materials respects with the laws of the State of Ohio. The Bank's Charter and bylaws comply in all material respects with the federal law and the Rules and Regulations of the Office of Thrift Supervision.

(xxi) To such counsel's Actual Knowledge, neither the Company nor the Bank is in violation of any directive from the OTS or the FDIC to make any

30

material change in the method of conducting its respective business.

(xxii) The information in the Prospectus under the captions "Regulation," "The Conversion," "Restrictions on Acquisition of the Company and the Bank" and "Description of Capital Stock of the Company," to the extent that such information constitutes matters of law, summaries of legal matters, documents or proceedings, or legal conclusions, has been reviewed by such counsel and is correct in all material respects. The description of the Conversion process under the caption "The Conversion" in the Prospectus has been reviewed by such counsel and fairly describes such process in all material respects. The discussion of statutes or regulations described or referred to in the Prospectus are accurate summaries and fairly present the information required to be shown. The information under the caption "The Conversion-Tax Aspects" has been reviewed by such counsel and fairly describes the opinions rendered by them to the Company and the Bank with respect to such matters.

In addition, such counsel shall state that during the preparation of the Conversion Application, the Registration Statement and the Prospectus, they participated in conferences with certain officers of, the independent public and internal accountants for, and other representatives of the Company and the Bank, at which conferences the contents of the Conversion Application, the Registration Statement and the Prospectus and related matters were discussed and, while such counsel have not confirmed the accuracy or completeness of or otherwise verified the information contained in the Conversion Application, the Registration Statement or the Prospectus, and do not assume any responsibility for such information, based upon such conferences and a review of documents deemed relevant for the purpose of rendering their opinion (relying as to materiality as to factual matters on certificates of officers and other factual representations by the Company and the Bank, nothing has come to their attention that would lead them to believe that the Conversion Application, the Registration Statement, the Prospectus, or any amendment or supplement thereto (other than the financial statements, the notes thereto, and other tabular, financial, statistical and appraisal data included therein as to which no view need be rendered) contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein

31

or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

In giving such opinion, such counsel may rely as to all matters of fact on certificates of officers or directors of the Company and the Bank and certificates of public officials. Such counsel's opinion shall be limited to matters governed by federal laws and by the laws of the State of Ohio. The opinion of Vorys, Sater, Seymour and Pease shall be governed by the Legal Opinion Accord ("Accord") of the American Bar Association Section of Business Law
(1991). The term "Actual Knowledge" as used herein shall have the meaning set forth in the Accord. For purposes of such opinion, no proceedings shall be deemed to be pending, no order or stop order shall be deemed to be issued, and no action shall be deemed to be instituted unless, in each case, a director or executive officer of the Company or the Bank shall have received a copy of such proceedings, order, stop order or action. In addition, such opinion may be limited to present statutes, regulations and judicial interpretations and to facts as they presently exist; in rendering such opinion, such counsel need assume no obligation to revise or supplement it should the present laws be changed by legislative or regulatory action, judicial decision or otherwise; and such counsel need express no view, opinion or belief with respect to whether any proposed or pending legislation, if enacted, or any proposed or pending regulations or policy statements issued by any regulatory agency, whether or not promulgated pursuant to any such legislation, would affect the validity of the Conversion or any aspect thereof. Such counsel may assume that any agreement is the valid and binding obligation of any parties to such agreement other than the Company or the Bank.

(d) The favorable opinion, dated as of the Closing Date, of Silver, Freedman & Taff, L.L.P., the Agent's counsel, with respect to such matters as the Agent may reasonably require. Such opinion may rely upon the opinions of counsel to the Company and the Bank, and as to matters of fact, upon certificates of officers and directors of the Company and the Bank delivered pursuant hereto or as such counsel shall reasonably request.

(e) At the Closing Date, the Agent shall receive a certificate of the Chief Executive Officer and the principal accounting officer of the Company and the Bank in form and substance reasonably satisfactory

32

to the Agent's Counsel, dated as of such Closing Date, to the effect that: (i) they have carefully examined the Prospectus and, in their opinion, at the time the Prospectus became authorized for final use, the Prospectus did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; (ii) since the date the Prospectus became authorized for final use, no event has occurred which should have been set forth in an amendment or supplement to the Prospectus which has not been so set forth, including specifically, but without limitation, any material adverse change in the condition, financial or otherwise, or in the earnings, capital, properties or business of the Company, the Bank or its subsidiary, and the conditions set forth in this Section 7 have been satisfied; (iii) since the respective dates as of which information is given in the Registration Statement and the Prospectus, there has been no material adverse change in the condition, financial or otherwise, or in the earnings, capital or properties of the Company, the Bank or its subsidiary, independently, or of the Company, the Bank or its subsidiary considered as one enterprise, whether or not arising in the ordinary course of business; (iv) the representations and warranties in
Section 4 are true and correct with the same force and effect as though expressly made at and as of the Closing Date; (v) the Company, and the Bank have complied in all material respects with all agreements and satisfied all conditions on their part to be performed or satisfied at or prior to the Closing Date and will comply in all material respects with all obligations to be satisfied by them after the Conversion; (vi) no stop order suspending the effectiveness of the Registration Statement has been initiated or, to the best knowledge of the Company or the Bank, threatened by the Commission or any state authority; (vii) no order suspending the Offering, the Conversion, the acquisition of all of the shares of the Bank by the Company or the effectiveness of the Prospectus has been issued and no proceedings for that purpose are pending or, to the best knowledge of the Company or the Bank, threatened by the OTS, the Commission, the FDIC, or any state authority; and
(viii) to the best knowledge of the Company or the Bank, no person has sought to obtain review of the final action of the OTS approving the Plan.

(f) Prior to and at the Closing Date: (i) in the reasonable opinion of the Agent, there shall have

33

been no material adverse change in the condition, financial or otherwise, or in the earnings or business of the Company, the Bank or its subsidiary independently, or of the Company, the Bank and its subsidiary considered as one enterprise, from that as of the latest dates as of which such condition is set forth in the Prospectus other than transactions referred to or contemplated therein; (iii) the Company or the Bank shall not have received from the OTS or the FDIC any direction (oral or written) to make any material change in the method of conducting their business with which it has not complied (which direction, if any, shall have been disclosed to the Agent) or which materially and adversely would affect the business, operations or financial condition or income of the Company and the Bank (together with its Subsidiary) taken as a whole; (iv) the Company, the Bank and its subsidiary shall not have been in default (nor shall an event have occurred which, with notice or lapse of time or both, would constitute a default) under any provision of any agreement or instrument relating to any outstanding indebtedness;
(v) no action, suit or proceeding, at law or in equity or before or by any federal or state commission, board or other administrative agency, shall be pending or, to the knowledge of the Company, the Bank or its subsidiary, threatened against the Company, the Bank or its subsidiary or affecting any of their properties wherein an unfavorable decision, ruling or finding would materially and adversely affect the business, operations, financial condition or income of the Company, the Bank and its subsidiary taken as a whole; and (vi) the Shares have been qualified or registered for offering and sale or exempted therefrom under the securities or blue sky laws of the jurisdictions as the Agent shall have reasonably requested and as agreed to by the Company and the Bank.

(g) Concurrently with the execution of this Agreement, the Agent shall receive a letter from Robb, Dixon, Francis, Davis, Oneson & Company dated as of the date of the Prospectus and addressed to the Agent:
(i) confirming that Robb, Dixon, Francis, Davis, Oneson & Company is a firm of independent public accounts within the meaning of Rule 101 of the Code of Professional Ethics of the American Institute of Certified Public Accountants and applicable regulations of the OTS and stating in effect that in its opinion the consolidated financial statements, schedules and related notes of the Bank as of June 30, 1996 and 1995 and for each of the three years in the period ended June 30, 1996, as are included in the Prospectus and covered by their

34

opinion included therein, comply as to form in all material respects with the applicable accounting requirements and related published rules and regulations of the OTS and the 1933 Act; (ii) stating in effect that, on the basis of certain agreed upon procedures (but not an audit in accordance with generally accepted auditing standards) consisting of a reading of the latest available unaudited interim consolidated financial statements of the Bank prepared by the Bank, a reading of the minutes of the meetings of the Board of Directors and members of the Bank and consultations with officers of the Bank responsible for financial and accounting matters, nothing came to their attention which caused them to believe that: (A) the unaudited financial statements included in the Prospectus are not in conformity with the 1933 Act, applicable accounting requirements of the OTS and generally accepted accounting principles applied on a basis substantially consistent with that of the audited financial statements included in the Prospectus; or (B) during the period from the date of the latest unaudited consolidated financial statements included in the Prospectus to a specified date not more than three business days prior to the date of the Prospectus, except as has been described in the Prospectus, there was any increase in borrowings, other than normal deposit fluctuations, by the Bank; or (C) there was any decrease in the consolidated net assets of the Bank at the date of such letter as compared with amounts shown in the latest unaudited consolidated statement of condition included in the Prospectus; and (iii) stating that, in addition to the audit referred to in their opinion included in the Prospectus and the performance of the procedures referred to in clause (ii) of this subsection (f), they have compared with the general accounting records of the Bank, which are subject to the internal controls of the Bank, the accounting system and other data prepared by the Bank, directly from such accounting records, to the extent specified in such letter, such amounts and/or percentages set forth in the Prospectus as the Agent may reasonably request; and they have reported on the results of such comparisons.

(h) At the Closing Date, the Agent shall receive a letter dated the Closing Date, addressed to the Agent, confirming the statements made by Robb, Dixon, Francis, Davis, Oneson & Company in the letter delivered by it pursuant to subsection (f) of this
Section 7, the "specified date" referred to in clause
(ii) of subsection (f) thereof to be a

35

date specified in such letter, which shall not be more than three business days prior to the Closing Date.

(i) At the Closing Date, the Agent shall receive a letter from Keller & Company, dated the date thereof and addressed to counsel for the Agent (i) confirming that said firm is independent of the Company and the Bank and is experienced and expert in the area of corporate appraisals within the meaning of Title 12 of the Code of Federal Regulations, Section 563b.7(f)(1)(i), (ii) stating in effect that the Appraisal prepared by such firm complies in all material respects with the applicable requirements of Title 12 of the Code of Federal Regulations, and (iii) further stating that their opinion of the aggregate pro forma market value of the Company and the Bank expressed in their Appraisal dated as of _________ __, 1996, and most recently updated, remains in effect.

(j) The Company and the Bank shall not have sustained since the date of the latest financial statements included in the Prospectus any material loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Registration Statement and Prospectus and since the respective dates as of which information is given in the Registration Statement and Prospectus, there shall not have been any change in the long-term debt of the Company or the Bank other than debt incurred in relation to the purchase of Shares by the Bank's Eligible Plans, or any change, or any development involving a prospective change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Company or the Bank, otherwise than as set forth or contemplated in the Registration Statement and Prospectus, the effect of which, in any such case described above, is in Webb's reasonable judgment sufficiently material and adverse as to make it impracticable or inadvisable to proceed with the Subscription Offering or the delivery of the Shares on the terms and in the manner contemplated in the Prospectus.

(k) At or prior to the Closing Date, the Agent shall receive: (i) a copy of the letter from the OTS approving the Conversion Application and authorizing the use of the Prospectus; (ii) a copy of the order from the Commission declaring the Registration Statement effective; (iii) a

36

certificate from the OTS evidencing the existence of the Bank; (iv) certificate of good standing from the State of Ohio evidencing the good standing of the Company and the Bank's subsidiary; (v) a certificate from the FDIC evidencing the Bank's insurance of accounts; (vi) a certificate of the FHLB-Chicago evidencing the Bank's membership thereof; (vii) a copy of the letter from the OTS approving the Company's Holding Company Application; and (viii) a copy of the Bank's federal stock charter.

(l) Subsequent to the date hereof, there shall not have occurred any of the following: (i) a suspension or limitation in trading in securities generally on the New York Stock Exchange or in the over-the-counter market, or quotations halted generally on the Nasdaq Stock Market, or minimum or maximum prices for trading have been fixed, or maximum ranges for prices for securities have been required by either of such exchanges or the NASD or by order of the Commission or any other governmental authority; (ii) a general moratorium on the operations of commercial banks, Ohio savings banks or federal savings banks or a general moratorium on the withdrawal of deposits from commercial banks, Ohio savings banks or federal savings banks declared by federal or state authorities; (iii) the engagement by the United States in hostilities which have resulted in the declaration, on or after the date hereof, of a national emergency or war; or (iv) a material decline in the price of equity or debt securities if the effect of such a declaration or decline, in the Agent's reasonable judgement, makes it impracticable or inadvisable to proceed with the Offering or the delivery of the shares on the terms and in the manner contemplated in the Registration Statement and the Prospectus.

(m) At or prior to the Closing Date, counsel to Webb shall have been furnished with such documents and opinions as they may reasonably require for the purpose of enabling them to pass upon the sale of the Shares as herein contemplated and related proceedings or in order to evidence the occurrence or completeness of any of the representations or warranties, or the fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company or the Bank in connection with the Conversion and the sale of the Shares as herein contemplated shall be satisfactory in form and substance to Webb and its counsel.

37

SECTION 8. INDEMNIFICATION.

(a) The Company and the Bank jointly and severally agree to indemnify and hold harmless the Agent, its respective officers and directors, employees and agents, and each person, if any, who controls the Agent within the meaning of
Section 15 of the 1933 Act or Section 20(a) of the 1934 Act, against any and all loss, liability, claim, damage or expense whatsoever (including but not limited to settlement expenses), joint or several, that the Agent or any of them may suffer or to which the Agent and any such persons may become subject under all applicable federal or state laws or otherwise, and to promptly reimburse the Agent and any such persons upon written demand for any expense (including reasonable fees and disbursements of counsel) incurred by the Agent or any of them in connection with investigating, preparing or defending any actions, proceedings or claims (whether commenced or threatened) to the extent such losses, claims, damages, liabilities or actions: (i) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment or supplement thereto), preliminary or final Prospectus (or any amendment or supplement thereto), the Conversion Application (or any amendment or supplement thereto), the Holding Company Application or any instrument or document executed by the Company or the Bank or based upon written information supplied by the Company or the Bank filed in any state or jurisdiction to register or qualify any or all of the Shares or to claim an exemption therefrom, or provided to any state or jurisdiction to exempt the Company as a broker-dealer or its officers, directors and employees as broker-dealers or agent, under the securities laws thereof (collectively, the "Blue Sky Application"), or any document, advertisement, oral statement or communication ("Sales Information") prepared, made or executed by or on behalf of the Company or the Bank with their consent or based upon written or oral information furnished by or on behalf of the Company or the Bank, whether or not filed in any jurisdiction, in order to qualify or register the Shares or to claim an exemption therefrom under the securities laws thereof; (ii) arise out of or based upon the omission or alleged omission to state in any

38

of the foregoing documents or information, a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; or (iii) arise from any theory of liability whatsoever relating to or arising from or based upon the Registration Statement (or any amendment or supplement thereto), preliminary or final Prospectus (or any amendment or supplement thereto), the Conversion Application (or any amendment or supplement thereto), any Blue Sky Application or Sales Information or other documentation distributed in connection with the Conversion; provided, however, that no indemnification is required under this paragraph (a) to the extent such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue material statement or alleged untrue material statement in, or material omission or alleged material omission from, the Registration Statement (or any amendment or supplement thereto), preliminary or final Prospectus (or any amendment or supplement thereto), the Conversion Application, any Blue Sky Application or Sales Information made in reliance upon and in conformity with information furnished in writing to the Company or the Bank by the Agent or its counsel regarding the Agent and, provided further, that such indemnification shall be to the extent permitted by the Commissioner, the OTS, the FDIC and the Board of Governors of the Federal Reserve.

(b) The Agent agrees to indemnify and hold harmless the Company and the Bank, their directors and officers and each person, if any, who controls the Company or the Bank within the meaning of Section 15 of the 1933 Act or Section 20(a) of the 1934 Act against any and all loss, liability, claim, damage or expense whatsoever (including but not limited to settlement expenses), joint or several, which they, or any of them, may suffer or to which they, or any of them may become subject under all applicable federal and state laws or otherwise, and to promptly reimburse the Company, the Bank, and any such persons upon written demand for any expenses (including reasonable fees and disbursements of counsel) incurred by them, or any of them, in connection with investigating, preparing or defending any actions, proceedings or claims (whether commenced or threatened) to the

39

extent such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment or supplement thereto), the Conversion Application (or any amendment or supplement thereto), the preliminary or final Prospectus (or any amendment or supplement thereto), any Blue Sky Application or Sales Information or are based upon the omission or alleged omission to state in any of the foregoing documents a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however, that the Agent's obligations under this Section 8(b) shall exist only if and only to the extent (i) that such untrue statement or alleged untrue statement was made in, or such material fact or alleged material fact was omitted from, the Registration Statement (or any amendment or supplement thereto), the preliminary or final Prospectus (or any amendment or supplement thereto), the Conversion Application (or any amendment or supplement thereto), any Blue Sky Application or Sales Information in reliance upon and in conformity with information furnished in writing to the Company or the Bank by the Agent or its counsel regarding the Agent. It is expressly agreed, however, that the Agent shall not be liable for any loss, liability, claim, damage or expense, or be required to contribute any amount which in the aggregate exceeds the fees paid to the Agent pursuant to Section 2 of this Agreement (not including expenses).

(c) Each indemnified party shall give prompt written notice to each indemnifying party of any action, proceeding, claim (whether commenced or threatened), or suit instituted against it in respect of which indemnity may be sought hereunder, but failure to so notify an indemnifying party shall not relieve it from any liability which it may have on account of this Section 8 or otherwise. An indemnifying party may participate at its own expense in the defense of such action. In addition, if it so elects within a reasonable time after receipt of such notice, an indemnifying party, jointly with any other indemnifying parties receiving such notice, may assume defense of such action with counsel

40

chosen by it and approved by the indemnified parties that are defendants in such action, unless such indemnified parties reasonably object to such assumption on the ground that there may be legal defenses available to them that are different from or in addition to those available to such indemnifying party. If an indemnifying party assumes the defense of such action, the indemnifying parties shall not be liable for any fees and expenses of counsel for the indemnified parties incurred thereafter in connection with such action, proceeding or claim, other than reasonable costs of investigation. In no event shall the indemnifying parties be liable for the fees and expenses of more than one separate firm of attorneys
(and any special counsel that said firm may retain)
for each indemnified party in connection with any one action, proceeding or claim or separate but similar or related actions, proceedings or claims in the same jurisdiction arising out of the same general allegations or circumstances.

(d) The agreements contained in this Section 8 and in Section 9 hereof and the representations and warranties of the Company and the Bank set forth in this Agreement shall remain operative and in full force and effect regardless of:
(i) any investigation made by or on behalf of agent or their officers, directors or controlling persons, agent or employees or by or on behalf of the Company or the Bank or any officers, directors or controlling persons, agent or employees of the Company or the Bank;
(ii) delivery of and payment hereunder for the Shares; or (iii) any termination of this Agreement.

SECTION 9. CONTRIBUTION. In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in
Section 8 is due in accordance with its terms but is for any reason held by a court to be unavailable from the Company, the Bank or the Agent, the Company, the Bank and the Agent shall contribute to the aggregate losses, claims, damages and liabilities (including any investigation, legal and other expenses incurred in connection with, and any amount paid in settlement of, any action, suit or proceeding of any claims asserted, but after deducting any contribution received by the Company, the Bank or the Agent from persons other than the other party thereto, who may also be liable for contribution) in such proportion so that the Agent is responsible for that portion represented by the percentage that the fees paid to the Agent pursuant to Section 2 of this Agreement (not including expenses) bears to the gross proceeds received by the Company from the sale

41

of the Shares in the Offering, and the Company and the Bank shall be responsible for the balance. If, however, the allocation provided above is not permitted by applicable law or if the indemnified party failed to give the notice required under Section 8 above, then each indemnifying party shall contribute to such amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative fault of the Company and the Bank on the one hand and the Agent on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions, proceedings or claims in respect thereto), but also the relative benefits received by the Company and the Bank on the one hand and the Agent on the other from the Offering (before deducting expenses). The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company and/or the Bank on the one hand or the Agent on the other and the parties' relative intent, good faith, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company, the Bank and the Agent agree that it would not be just and equitable if contribution pursuant to this Section 9 were determined by pro-rata allocation or by any other method of allocation which does not take into account the equitable considerations referred to above in this Section 9. The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions, proceedings or claims in respect thereof) referred to above in this Section 9 shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action, proceeding or claim. It is expressly agreed that the Agent shall not be liable for any loss, liability, claim, damage or expense or be required to contribute any amount which in the aggregate exceeds the amount paid (excluding reimbursable expenses) to the Agent under this Agreement. It is understood that the above stated limitation on the Agent's liability is essential to the Agent and that the Agent would not have entered into this Agreement if such limitation had not been agreed to by the parties to this Agreement. No person found guilty of any fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not found guilty of such fraudulent misrepresentation. The obligations of the Company and the Bank under this Section 9 and under Section 8 shall be in addition to any liability which the Company and the Bank may otherwise have. For purposes of this Section 9, each of the Agent's, the Company's or the Bank's officers and directors and each person, if any, who controls the Agent or the Company or the Bank within the meaning of the 1933 Act and the 1934 Act shall have the same rights to contribution as the Agent, the Company or the Bank. Any party entitled to contribution, promptly after receipt of notice of commencement of any action, suit, claim or proceeding against such party in respect of which a claim for contribution may be made against another party under this Section 9, will notify such party from whom contribution may be sought, but the omission to so notify

42

such party shall not relieve the party from whom contribution may be sought from any other obligation it may have hereunder or otherwise than under this Section 9.

SECTION 10. SURVIVAL OF AGREEMENTS, REPRESENTATIONS AND INDEMNITIES. The respective indemnities of the Company, the Bank and the Agent and the representations and warranties and other statements of the Company, the Bank and the Agent set forth in or made pursuant to this Agreement shall remain in full force and effect, regardless of any termination or cancellation of this Agreement or any investigation made by or on behalf of the Agent, the Company, the Bank or any controlling person referred to in Section 8 hereof, and shall survive the issuance of the Shares, and any successor or assign of the Agent, the Company, the Bank, and any such controlling person shall be entitled to the benefit of the respective agreements, indemnities, warranties and representations.

SECTION 11. TERMINATION. Webb may terminate this Agreement by giving the notice indicated below in this Section 11 at any time after this Agreement becomes effective as follows:

(a) In the event the Company fails to sell the required minimum number of the Shares by September 30, 1997, and in accordance with the provisions of the Plan or as required by the Conversion Regulations, and applicable law, this Agreement shall terminate upon refund by the Company to each person who has subscribed for or ordered any of the Shares the full amount which it may have received from such person, together with interest as provided in the Prospectus, and no party to this Agreement shall have any obligation to the other hereunder, except for payment by the Company and/or the Bank as set forth in Sections 2(a), 6, 8 and 9 hereof.

(b) If any of the conditions specified in Section 7 shall not have been fulfilled when and as required by this Agreement unless waived in writing, or by the Closing Date, this Agreement and all of the Agent's obligations hereunder may be cancelled by the Agent by notifying the Company and the Bank of such cancellation in writing or by telegram at any time at or prior to the Closing Date, and any such cancellation shall be without liability of any party to any other party except as otherwise provided in Sections 2(a), 6, 8 and 9 hereof.

(c) If Webb elects to terminate this Agreement as provided in this Section , the Company and the Bank shall be notified promptly by telephone or telegram, confirmed by letter.

43

The Company and the Bank may terminate this Agreement in the event Webb is in material breach of the representations and warranties or covenants contained in Section 5 and such breach has not been cured after the Company and the Bank have provided Webb with notice of such breach.

This Agreement may also be terminated by mutual written consent of the parties hereto.

SECTION 12. NOTICES. All communications hereunder, except as herein otherwise specifically provided, shall be mailed in writing and if sent to Webb shall be mailed, delivered or telegraphed and confirmed to Charles Webb & Company, 211 Bradenton, Dublin, Ohio 43017-5034, Attention: Patricia A. McJoynt (with a copy to Silver, Freedman & Taff, L.L.P., Attention: Jeffrey M. Werthan, P.C. and, if sent to the Company and the Bank, shall be mailed, delivered or telegraphed and confirmed to the Company and the Bank at 63 West Main Street, Springfield, Ohio 45502, Attention: Douglas L. Ulery, President (with a copy to Vorys, Sater, Seymour and Pease, Attention: Rick J. Landrum).

SECTION 13. PARTIES. The Company and the Bank shall be entitled to act and rely on any request, notice, consent, waiver or agreement purportedly given on behalf of the Agent when the same shall have been given by the undersigned. The Agent shall be entitled to act and rely on any request, notice, consent, waiver or agreement purportedly given on behalf of the Company or the Bank, when the same shall have been given by the undersigned or any other officer of the Company or the Bank. This Agreement shall inure solely to the benefit of, and shall be binding upon, the Agent, the Company, the Bank, and their respective successors and assigns, and no other person shall have or be construed to have any legal or equitable right, remedy or claim under or in respect of or by virtue of this Agreement or any provision herein contained. It is understood and agreed that this Agreement is the exclusive agreement among the parties hereto, and supersedes any prior agreement among the parties and may not be varied except in writing signed by all the parties.

SECTION 14. CLOSING. The closing for the sale of the Shares shall take place on the Closing Date at such location as mutually agreed upon by the Agent and the Company and the Bank. At the closing, the Company and the Bank shall deliver to the Agent in next day funds the commissions, fees and expenses due and owing to the Agent as set forth in Sections 2 and 6 hereof and the opinions and certificates required hereby and other documents deemed reasonably necessary by the Agent shall be executed and delivered to effect the sale of the Shares as contemplated hereby and pursuant to the terms of the Prospectus.

SECTION 15. PARTIAL INVALIDITY. In the event that any term, provision or covenant herein or the application thereof to any circumstance or situation shall be invalid or unenforceable, in whole or in part, the remainder hereof and the application of said term, provision or covenant to any other circumstances or situation

44

shall not be affected thereby, and each term, provision or covenant herein shall be valid and enforceable to the full extent permitted by law.

SECTION 16. CONSTRUCTION. This Agreement shall be construed in accordance with the laws of the State of Ohio.

SECTION 17. COUNTERPARTS. This Agreement may be executed in separate counterparts, each of which so executed and delivered shall be an original, but all of which together shall constitute but one and the same instrument.

If the foregoing correctly sets forth the arrangement among the Company, the Bank and Webb, please indicate acceptance thereof in the space provided below for that purpose, whereupon this letter and the Agent's acceptance shall constitute a binding agreement.

SECTION 18. ENTIRE AGREEMENT. This Agreement, including schedules and exhibits hereto, which are integral parts hereof and incorporated as though set forth in full, constitutes the entire agreement between the parties pertaining to the subject matter hereof superseding any and all prior or contemporaneous oral or prior written agreements, proposals, letters of intent and understandings, and cannot be modified, changed, waived or terminated except by a writing which expressly states that it is an amendment, modification or waiver, refers to this Agreement and is signed by the party to be charged. No course of conduct or dealing shall be construed to modify, amend or otherwise affect any of the provisions hereof.

                                                Very truly yours,

HOME CITY FINANCIAL CORPORATION                 HOME CITY FEDERAL SAVINGS BANK

By:                                            By:
   ----------------------------                   ------------------------------
         Douglas L. Ulery                         Douglas L. Ulery
         President                                President

Accepted as of the date first above written

CHARLES WEBB & COMPANY, A DIVISION OF
  KEEFE, BRUYETTE & WOODS, INC.

By:
   ----------------------------------------
   Patricia A. McJoynt
   Executive Vice President

45

EXHIBIT 10.3

HOME CITY FINANCIAL CORPORATION

EMPLOYEE STOCK OWNERSHIP PLAN

Effective January 1, 1996


HOME CITY FINANCIAL CORPORATION

EMPLOYEE STOCK OWNERSHIP PLAN

TABLE OF CONTENTS

SECTION                                                                                                    PAGE
-------                                                                                                    ----

    1            PARTICIPATION ......................................................................        1
                 -------------

                 1.01          Eligibility Requirements..............................................        1
                 1.02          Service for Eligibility...............................................        1

    2            CONTRIBUTIONS ......................................................................        1
                 -------------

                 2.01          Regular Employer Contribution.........................................        1
                 2.02          Employer Contribution to Reduce
                                 Loan Obligation.....................................................        2
                 2.03          Rollover Contributions/Participant
                                 Contributions.......................................................        2
                 2.04          Limitations on Annual Additions.......................................        2
                 2.05          Dual Plan Limitation..................................................        3
                 2.06          Corrective Adjustments................................................        4
                 2.07          Contributions Conditioned on
                               Plan Qualification....................................................        4

    3            ALLOCATION OF EMPLOYER CONTRIBUTIONS................................................        5
                 ------------------------------------

                 3.01          Allocation of Regular Contributions
                                 and Forfeitures.....................................................        5
                 3.02          Allocation of Employer Shares Purchased
                                 with Proceeds of Plan Loan..........................................        5
                 3.03          Special Restriction on Allocation.....................................        5

    4            PARTICIPANTS' ACCOUNTS..............................................................        6
                 ----------------------

                 4.01          Establishment of Employer Contributions
                                 Accounts............................................................        6
                 4.02          Establishment of Suspense Account.....................................        6

    5            PLAN INVESTMENTS....................................................................        6
                 ----------------

                 5.01          Primary Investments...................................................        6
                 5.02          Diversification Requirements..........................................        7


SECTION                                                                                                    PAGE
-------                                                                                                    ----


    6            VALUATION OF PARTICIPANTS' ACCOUNTS.................................................        7
                 -----------------------------------

                 6.01          Valuations............................................................        7
                 6.02          Method of Adjustment..................................................        8

    7            RETIREMENT BENEFITS.................................................................        9
                 -------------------

                 7.01          Time of Retirement....................................................        9
                 7.02          Amount of Retirement Benefits.........................................        9

    8            DEATH BENEFITS......................................................................        9
                 --------------

                 8.01          Amount of Death Benefit...............................................        9
                 8.02          Designation of Beneficiary............................................        9
                 8.03          Distribution of Death Benefit.........................................       10

    9            DISABILITY BENEFITS.................................................................       11
                 -------------------

                 9.01          Amount of Disability Benefit..........................................       11
                 9.02          Determination of Total and Permanent
                                 Disability..........................................................       11

    10           TERMINATION OF EMPLOYMENT...........................................................       11
                 -------------------------

                 10.01         Amount of Benefits Upon Termination of
                                 Employment..........................................................       11

    11           VESTING       ......................................................................       12
                 -------

                 11.01         Determination of Vested Benefits......................................       12
                 11.02         Service for Vesting...................................................
                 11.03         Full Vesting at Normal Retirement Age,
                                 Death or Disability.................................................       12
                 11.04         Termination After Eligibility for
                                 Retirement..........................................................       12

    12           PAYMENT OF BENEFITS.................................................................       13
                 -------------------

                 12.01         Method of Payment.....................................................       13
                 12.02         Timing of Payments....................................................       13
                 12.03         Installment Payments..................................................       13
                 12.04         Distributions After Death.............................................       14


SECTION                                                                                                    PAGE
-------                                                                                                    ----

                 12.05         Cash-Outs.............................................................       15
                 12.06         Put Option............................................................       15
                 12.07         Right of First Refusal................................................       16
                 12.08         Eligible Rollover Distributions.......................................       17

    13           BREAK IN SERVICE RULES..............................................................       18
                 ----------------------

                 13.01         Effect of Break in Service on
                                 Eligibility.........................................................       18
                 13.02         Effect of Break in Service on Vesting.................................       19
                 13.03         Authorized Leaves of Absence..........................................       19

    14           TRUST AGREEMENT.....................................................................       20
                 ---------------

                 14.01  Description of Trust Agreement...............................................       20

    15           PLAN ADMINISTRATION.................................................................       20
                 -------------------

                 15.01         Plan Administrator....................................................       20
                 15.02         Duties of Plan Administrator..........................................       20

    16           AMENDMENTS    ......................................................................       21
                 ----------

                 16.01  Employer's Right to Amend Plan...............................................       21

    17           DISTRIBUTIONS ON PLAN TERMINATION...................................................       22
                 ---------------------------------

                 17.01         Full Vesting on Plan Termination......................................       22
                 17.02         Payment on Plan Termination...........................................       22
                 17.03         Discontinuance of Contributions;
                                 Partial Termination of Plan.........................................       22

    18           CREDITORS OF PARTICIPANTS...........................................................       22
                 -------------------------

                 18.01         Non-Assignability.....................................................       22
                 18.02         Qualified Domestic Relations Orders...................................       23

    19           CLAIMS PROCEDURES...................................................................       23
                 -----------------

                 19.01         Filing a Claim for Benefits...........................................       23
                 19.02         Denial of Claim.......................................................       23
                 19.03         Remedies Available to Participants....................................       24


SECTION                                                                                                    PAGE
-------                                                                                                    ----


    20           VOTING RIGHTS ......................................................................       24
                 -------------

                 20.01         Participant Voting Rights with
                                 Respect to Allocated Shares.........................................       24
                 20.02         Participant Voting Rights with
                               Respect to Unallocated Shares.........................................       25

    21           TOP HEAVY RULES.....................................................................       25
                 ---------------

                 21.01         Definitions...........................................................       25
                 21.02         Top Heavy Status......................................................       26
                 21.03         Minimum Contributions.................................................       27

    22           EXEMPT LOANS  ......................................................................       28
                 ------------

                 22.01         Authority to Borrow...................................................       28
                 22.02         Requirements for Plan Loans...........................................       28

    23           MISCELLANEOUS ......................................................................       30
                 -------------

                 23.01         Employment Rights.....................................................       30
                 23.02         Gender................................................................       30
                 23.03         Notice Requirement....................................................       30
                 23.04         Merger or Consolidation...............................................       30
                 23.05         Social Security Benefits..............................................       30
                 23.06         Forfeitures...........................................................       31
                 23.07         Named Fiduciaries.....................................................       31
                 23.08         Limitations on Payment................................................       31
                 23.09         Interpretation of Document............................................       31
                 23.10         Nonterminable Protections and Rights..................................       32
                 23.11         Use of Income With Respect to
                                 Employer Shares.....................................................       32

    24           CERTAIN DEFINITIONS.................................................................       32
                 -------------------

                 24.01         Account...............................................................       32
                 24.02         Adjustment Factor.....................................................       32
                 24.03         Affiliate.............................................................       32
                 24.04         Annual Additions......................................................       33
                 24.05         Beneficiary...........................................................       33
                 24.06         Code..................................................................       33
                 24.07         Compensation..........................................................       34
                 24.08         Current Participant...................................................       34


SECTION                                                                                                    PAGE
-------                                                                                                    ----


                 24.09         Intentionally Omitted.................................................       34
                 24.10         Effective Date........................................................       34
                 24.11         Employee..............................................................       34
                 24.12         Employer..............................................................       35
                 24.13         Employer Contributions Account........................................       35
                 24.14         Employer Shares or Shares.............................................       35
                 24.15         Employment Commencement Date..........................................       35
                 24.16         Entry Date............................................................       35
                 24.17         ERISA.................................................................       35
                 24.18         Family Member.........................................................       35
                 24.19         Forfeiture............................................................       36
                 24.20         Full Time.............................................................       36
                 24.21         Highly-Compensated Employee...........................................       36
                 24.22         Hour of Service.......................................................       37
                 24.23         Late Retirement Date..................................................       38
                 24.24         Leased Employee.......................................................       39
                 24.25         Limitation Year.......................................................       39
                 24.26         Normal Retirement Age.................................................       39
                 24.27         Normal Retirement Date................................................       39
                 24.28         One-Year Break in Service.............................................       40
                 24.29         Participant...........................................................       40
                 24.30         Plan..................................................................       40
                 24.31         Plan Administrator....................................................       40
                 24.32         Plan Year.............................................................       40
                 24.33         Projected Annual Benefit..............................................       40
                 24.34         Spouse or Surviving Spouse............................................       41
                 24.35         Trust Agreement.......................................................       41
                 24.36         Trust Fund............................................................       41
                 24.37         Trustee...............................................................       41
                 24.38         Valuation Date........................................................       41
                 24.39         Year of Service.......................................................       41

    25           MULTIEMPLOYER PROVISIONS............................................................       42
                 ------------------------

                 25.01         Adoption by Affiliates of Home City
                                 Financial Corporation...............................................       42
                 25.02         Administration........................................................       42
                 25.03         Common Fund...........................................................       42
                 25.04         Withdrawal-Termination................................................       42


HOME CITY FINANCIAL CORPORATION

EMPLOYEE STOCK OWNERSHIP PLAN

Home City Financial Corporation hereby adopts the following employee stock ownership plan (hereinafter referred to as the "Plan"), effective as of the Effective Date. The Plan shall be for the exclusive benefit of eligible Employees and, where applicable, the designated Beneficiaries of such Employees. It is intended that this Plan, together with the Trust Agreement, shall comply with the applicable provisions of the Code and ERISA.

SECTION l

PARTICIPATION

1.01. Eligibility Requirements

Each Employee who was (i) a Full-Time Employee during the 12 month period immediately preceding the Effective Date, and (ii) employed by the Employer and at least 21 years of age on the Effective Date, shall become a Participant in the Plan on the Effective Date. Each other Employee of the Employer shall be eligible to participate in the Plan on the Entry Date coinciding with or first following the date on which he has attained 21 years of age and has completed 12 months of service as a Full-Time Employee.

1.02. Service for Eligibility

The 12-month period during which the Employee must meet the Full-Time requirement shall initially be the 12 consecutive months beginning with his Employment Commencement Date, and, thereafter shall be each Plan Year beginning with the Plan Year that includes the first anniversary of the Employee's Employment Commencement Date.


SECTION 2

CONTRIBUTIONS

2.01. Regular Employer Contribution

Subject to its right to terminate or amend this Plan, the Employer may contribute and pay to the Trustee of the Trust Fund created for the purpose of carrying out this Plan a contribution in cash or Employer Shares as the Board of Directors of the Employer may in its discretion determine.

The amount of such contribution by the Employer to be paid to the Plan in any year shall be such amount as the Board of Directors of the Employer may in its discretion determine; provided, however, that in any year the amount contributed shall not exceed the maximum amount deductible from the Employer's income for such year under Section 404(a)(3) of the Code, or any succeeding statute of similar import.

2.02. Employer Contribution to Reduce Loan Obligation

In addition to the contributions authorized by Section 2.01, the Employer may in its discretion contribute amounts sufficient to enable the Trustee to pay, on or before the due date thereof, each installment of principal and interest on any Plan loan used to acquire Employer Shares; provided, that the amounts contributed by the Employer pursuant to this Section 2.02, in any year, shall not exceed the maximum amount deductible from the Employer's income for such year under Section 404(a)(9) of the Code, or any succeeding statute of similar import.

2.03. Rollover Contributions/Participant Contributions

Neither rollover contributions nor participant contributions to the Plan are permitted.

2.04. Limitations on Annual Additions

Annual Additions to each Participant's Account shall not exceed the lesser of (a) $30,000 [or if greater, 1/4th of the defined benefit dollar limitation in effect under Code Section 415(b)(l) for the Limitation Year]; or (b) 25% of the Participant's compensation for the Limitation Year; provided,

2

however, that for any Plan Year in which the conditions of Code Section 415(c)(6) are satisfied by the Plan, the limitations contained in this Section 2.04 shall be adjusted to the maximum amount permitted under such section of the Code. For purposes of this Section 2.04, the portion of such Employer contribution which is deemed to be allocated to a Participant's Account shall be an amount which bears the same ratio to the total contribution made by or on behalf of the Employer for such Plan Year which is used to repay principal on one or more Plan loans, or to purchase Employer Shares, as the number of Employer Shares allocated to such Participant's Account in respect of such Plan Year bears to the total number of Employer Shares allocated to the Accounts of all Participants in respect of such Plan Year.

For purposes of this Section 2.04, "compensation" shall mean compensation as defined in Treasury Regulation Section 1.415-2(d) and shall include wages, salaries, fees for professional services, percentage of profits, earned income in the case of a self-employed Participant, disability payments under Code
Section 105(d), paid or reimbursed moving expenses to the extent not deductible by the Participant, medical reimbursement items and the value of a non-qualified stock option to the extent includable in an Employee's gross income upon making the election under Code Section 83(b). Specifically excluded are salary deferral contributions; contributions to or distributions from most deferred compensation plans; amounts realized from the sale of a non-qualified stock option plan or from the sale, exchange or other disposition of stock acquired under a qualified stock option plan and most amounts which receive special tax benefits.

2.05. Dual Plan Limitation

If the Participant is, or was, covered under a defined benefit plan and a defined contribution plan maintained by the Employer, the sum of the Participant's defined benefit plan fraction and defined contribution plan fraction may not exceed 1.0 in any Limitation Year.

The defined benefit plan fraction is a fraction, the numerator of which is the sum of the Participant's Projected Annual Benefits under all defined benefit plans (whether or not terminated) maintained by the Employer and the denominator of which is the lesser of (a) 1.25 times the dollar limitation of

3

Section 415(b)(1)(A) of the Code in effect for the Limitation Year; or (b) 1.4 times the Participant's average compensation for the three consecutive years that produced the highest average.

The defined contribution plan fraction is a fraction, the numerator of which is the sum of the Annual Additions to the Participant's Accounts under all defined contribution plans maintained by the Employer (whether or not terminated) for the current and all prior Limitation Years, and the denominator of which is the sum of the lesser of the following amounts determined for such year and for each prior Year of Service with the Employer: (a) 1.25 times the dollar limitation in effect under Section 415(c)(1)(A) of the Code for such year; or (b) 1.4 times the amount which may be taken into account under Section 415(c)(1)(B) of the Code.

For any years in which the Plan is "top heavy," "1.0" shall be substituted for "1.25" in the preceding two paragraphs.

If, in any Limitation Year, the sum of the defined benefit plan fraction and the defined contribution plan fraction exceeds 1.0, the rate of benefit accruals under this Plan will be reduced so that the sum of the fractions equals 1.0.

2.06. Corrective Adjustments

If, due to a reasonable error in estimating a Participant's annual compensation or due to the allocation of Forfeitures an excess Annual Addition exists, such excess will be used to reduce Employer contributions for such Participant in the next, and succeeding, Limitation Years. If the Participant was not covered by the Plan at the end of the Limitation Year, such excess will be applied to reduce Employer contributions for all remaining Participants in the next, and succeeding, Limitation Years.

2.07. Contributions Conditioned on Plan Qualification

All Employer contributions under this Plan will be made with the understanding that the Plan will qualify under the provisions of Section 401(a) of the Code. In the event the Internal Revenue Service initially determines that this Plan fails to meet the requirements for a qualified plan and the Employer is unable to amend the Plan so as to receive a favorable

4

determination, then all Employer contributions under the Plan, less any expenses and adjusted by any gains or losses, will be refunded to the Employer.

SECTION 3

ALLOCATION OF EMPLOYER CONTRIBUTIONS

3.01. Allocation of Regular Contributions and Forfeitures

Each Plan Year, the Employer's regular contribution made pursuant to
Section 2.01, and any Forfeitures available for such year, shall be allocated to the Accounts of Current Participants. In that regard, the amount allocated to the Account of a particular Current Participant shall be in the same proportion to the total amounts available for allocation as the Compensation of such Current Participant for the Plan Year bears to the Compensation of all Current Participants for such Plan Year.

3.02. Allocation of Employer Shares Purchased with Proceeds of Plan Loan

Any Employer Shares purchased with the proceeds of Plan loans shall be held in a suspense account and allocated to Participants' Employer Contributions Accounts as such loans are reduced and such Shares are released pursuant to the terms of the loans. Each year the number of Employer Shares released under all Plan loans shall be allocated to each Participant's Employer Contributions Account in the same manner as the Employer's regular contribution is allocated under Section 3.01.

3.03. Special Restriction on Allocation

Notwithstanding any provision contained herein, no portion of the assets of the Plan attributable to Employer Shares acquired by the Plan in a sale to which either Sections 1042 or 2057 of the Code applies may be allocated, either directly or indirectly, (i) to the Employer Contributions Account of a Participant who owns, after application of Section 318(a) of the Code, more than 25% of either (a) any class of outstanding stock of the Employer; or (b) the total value of any outstanding stock of the Employer; or (ii) during the nonallocation period [as defined in Code Section 409(n)] to the Employer Contributions

5

Account of a Participant -- or any person related to such Participant within the meaning of Code Section 267(b) -- who makes an election under Code Section 1042(a) with respect to Employer Shares.

SECTION 4

PARTICIPANTS' ACCOUNTS

4.01. Establishment of Employer Contributions Accounts

The Plan Administrator shall establish and maintain an Employer Contributions Account for each Participant to record:

(a) his share of the Employer contributions and Forfeitures allocated under
Section 3; and

(b) his share of the net income, or net losses, resulting from the investment thereof.

4.02. Establishment of Suspense Account

The Plan Administrator shall establish and maintain a suspense account to record the number of Employer Shares encumbered under all outstanding Plan loans. As described in Section 3.02, Employer Shares shall be transferred from the suspense account and allocated to the Participants' Employer Contributions Accounts as such Shares are released from encumbrance under the terms of such Plan loans.

SECTION 5

PLAN INVESTMENTS

5.01. Primary Investments

As an employee stock ownership plan, this Plan shall invest primarily in Employer Shares. Any Plan assets not invested in Employer Shares shall be invested in other investment vehicles by the Trustee, in its discretion, pursuant to the provisions of the Trust Agreement.

6

5.02. Diversification Requirements

(a) Any Participant who has completed at least ten years of participation in the Plan and who has attained age 55 (the "diversification requirements"), may elect within the first 90 days of each of the six Plan Years immediately following the Plan Year in which he first satisfies the diversification requirements, to direct the Plan as to the investment of up to 25% of the total balance of his Account attributable to Employer Shares (to the extent such 25% portion exceeds the amount to which a prior election under this paragraph applies). In the case of the Plan Year in which the Participant can make his last such election, the preceding sentence shall be applied by substituting "50%" for "25%." The Participant's direction (i) shall be provided to the Plan Administrator in writing.

(b) The Plan shall, in each instance, distribute [notwithstanding Section 409(d) of the Code] the portion of the Participant's Account that is covered by the election within the first 180 days of the Plan Year in which the election is made. This paragraph (b) shall apply notwithstanding any other provision of the Plan other than such provisions as require the consent of the Participant to a distribution with a present value in excess of $3,500. If the Participant does not consent, such amount shall be retained in the Plan.

(c) In lieu of making the distribution described in paragraph (b) above, the Plan may satisfy the requirements of paragraph (a) by offering at least three investment options (other than Employer Shares) to each Participant making the election described in paragraph (a); and if the Participant so elects by investing, within the 180 day period specified in paragraph (b), the amount in question in the option(s) selected by the Participant.

SECTION 6

VALUATION OF PARTICIPANTS' ACCOUNTS

6.01. Valuations

As of each Valuation Date, or more frequently at the election of the Plan Administrator, the Plan Administrator shall obtain an evaluation of the assets of the Trust Fund from the

7

Trustee on the basis of the market value of the assets of the Trust Fund. On the basis of such valuation, the Participants' Accounts shall be adjusted as of such Valuation Date to reflect the effect of income received or accrued, realized and unrealized profits and losses, expenses, Forfeitures, payments to Participants and all other transactions in the period since the last preceding Valuation Date.

For purposes of valuation of Employer Shares under this Section and with respect to all other activities carried on by the Plan which require the valuation of Employer Shares, at all times during which the Employer Shares are not readily tradable on an established securities market, such valuations shall be made by an independent appraiser, within the meaning of Section 401(a)(28)(C) of the Code.

6.02. Method of Adjustment

The amount to the credit of each Participant's Account as of each Valuation Date shall be adjusted as of each succeeding Valuation Date by the following credits and charges in the order specified:

(a) In the case of each Participant to, for or on behalf of whom disbursements from the Plan have been made, there shall be debited the total amount of any disbursements made to him or for his account from his Account during the period since the last Valuation Date.

(b) In the case of each Participant (including former Employees for whom Accounts are being maintained), there shall be credited or debited to his Account that portion of the net increase (including an amount equal to the non-distributed dividends on allocated Employer Shares) or net decrease of the value of the assets of the Trust Fund since the last Valuation Date which the balance of his Account (after completion of the adjustment called for in Section 6.02(a) above) bears to the total balance of all Accounts after completion of the adjustments called for in Section 6.02(a) above.

(c) In the case of each Current Participant, there shall be credited to his Account the Employer's contributions, Forfeiture and Employer Shares released under Plan loans that are allocable to him under Section 3 of this Plan. In allocating

8

Forfeitures, Employer Shares shall be allocated only after other assets in the terminated Participants' Accounts have been allocated.

SECTION 7

RETIREMENT BENEFITS

7.01. Time of Retirement

A Participant may retire from the employ of the Employer on his Normal Retirement Date or his Late Retirement Date.

7.02. Amount of Retirement Benefits

The amount which a Participant shall be entitled to receive upon reaching his Normal Retirement Date or his Late Retirement Date shall be an amount equal to the value of the Employer Shares credited to his Account and the net value of the other assets of such Account as of the first Valuation Date following his Normal Retirement Date or his Late Retirement Date.

SECTION 8

DEATH BENEFITS

8.01. Amount of Death Benefit

The death benefit under this Plan shall be an amount equal to the value of the Employer Shares and the net value of the other assets credited to the deceased Participant's Account as of the first Valuation Date following the date of his death.

8.02. Designation of Beneficiary

Subject to the provisions of Section 8.03, each Participant shall designate, by a written instrument filed with the Plan Administrator, one or more Beneficiaries who, upon the death of the Participant, shall be entitled to receive the death benefit described in Section 8.01. If more than one Beneficiary is named, the Participant may specify the sequence and/or proportion in which payments must be made to each Beneficiary. In the absence of such specification, payments shall be made in

9

equal shares to all named Beneficiaries then living at the time of the Participant's death. To the extent otherwise consistent with this Plan, a Participant may change his Beneficiary from time to time by written notice delivered to the Plan Administrator in the manner prescribed by the Plan Administrator. The Plan Administrator may, in its discretion, limit the number of Beneficiaries that may be designated by a Participant. If no Beneficiary has been designated or if no designated Beneficiary is living at the time of the Participant's death, payment of such death benefit, if any, to the extent permitted by law, shall be made to the surviving person or persons in the first of the following classes of successive preference of beneficiaries: (a) Surviving Spouse; (b) issue, then living, per stirpes; (c) executors or administrators. Any minor's share shall be paid to such adult or adults as have, in the opinion of the Plan Administrator, assumed custody and support of such minor. Proof of death satisfactory to the Plan Administrator must be furnished prior to the payment of any death benefit under the Plan. Once benefits begin to be paid to a Beneficiary pursuant to this Section, such Beneficiary shall name an individual or individuals to receive the remainder of such benefit, if any, upon the death of the Beneficiary. In the absence of such a designation by the Beneficiary, such remaining benefit, if any, shall be paid to the estate of the Beneficiary.

8.03. Distribution of Death Benefit

If a Participant dies without a Surviving Spouse either before retirement or after retirement, but before a complete distribution of his Accounts, the death benefit described in Section 8.01 shall be distributed to the person or persons specified in Section 8.02, in accordance with the provisions of Section 12 hereof.

If a Participant dies with a Surviving Spouse either before retirement or after retirement, but before a complete distribution of his Accounts, then, notwithstanding the provisions of Section 8.02 hereof, the death benefit described in Section 8.01 shall be paid to his Surviving Spouse in accordance with the provisions of Section 12 hereof, UNLESS such Surviving Spouse, in accordance with the provisions of this paragraph, has consented to an alternate Beneficiary, in which case, such death benefit shall be distributed to such alternate Beneficiary in accordance with the provisions of Section 12. For purposes

10

of the preceding sentence, the consent of the Spouse must (a) be in writing; (b) designate a specific Beneficiary, including any class of beneficiaries or contingent beneficiaries, which may not be changed without spousal consent (or the Spouse expressly permits designations by the Participant without further spousal consent); (c) acknowledge the effect of such consent; and (d) be witnessed by a Plan representative or notary public.

SECTION 9

DISABILITY BENEFITS

9.01. Amount of Disability Benefit

If a Participant becomes "totally and permanently disabled" as defined in
Section 9.02 below, such Participant shall be entitled to receive as a disability benefit an amount equal to the value of the Employer Shares credited to his Account and the net value of other assets of such Account as of the first Valuation Date following the date that the Plan Administrator determines him to be "totally and permanently disabled".

9.02. Determination of Total and Permanent Disability

A Participant shall be considered to be "totally and permanently disabled" if it is established by a licensed physician selected by the Plan Administrator that (i) the Participant has suffered a disability which is expected to result in his death or last for not less than 12 months; and (ii) the Participant is not able to perform his job or any job for which he is reasonably suited as a result of his education, training and experience. The determination by the Plan Administrator with respect to whether a Participant is totally and permanently disabled shall be made in a nondiscriminatory manner.

SECTION 10

TERMINATION OF EMPLOYMENT

10.01. Amount of Benefits Upon Termination of Employment

If a Participant leaves the employ of the Employer for any reason other than retirement, death or disability in accordance with Sections 7, 8 or 9 hereof, he shall be entitled

11

to receive an amount equal to the nonforfeitable percentage of the value of the Employer Shares and the net value of the other assets credited to his Account as of the first Valuation Date following the date of his termination of employment. Such nonforfeitable percentage shall be determined in accordance with Section 11.01 hereof.

SECTION 11

VESTING

11.01. Fully Vested Benefits

Employer contributions allocated to a Participant's Employer Contributions Account shall become vested in accordance with the table shown below:

                                      NONFORFEITABLE
YEARS OF SERVICE                        PERCENTAGE
----------------                        ----------
  Less than 1                               0
       1                                   20%
       2                                   40%
       3                                   60%
       4                                   80%
   5 or more                               100%

11.02. Service for Vesting

Years of Service for vesting purposes shall include all Years of Service with the Employer.

11.03. Full Vesting at Normal Retirement Age, Death or Disability

Notwithstanding any provision in this Plan to the contrary, the value of a Participant's Account shall be fully vested and nonforfeitable upon the Participant's (i) attaining his Normal Retirement Age, (ii) becoming totally and permanently disabled, or (iii) death.

11.04. Termination After Eligibility for Retirement

12

The termination of a Participant's employment after he has attained his Normal Retirement Age shall be considered a retirement for purposes of this Plan.

SECTION 12

PAYMENT OF BENEFITS

12.01. Method of Payment

At the time a Participant becomes entitled to receive any amount because of his retirement, death, disability or termination of employment, the Trustee, acting in accordance with the written instructions of the Plan Administrator, shall make payment from the Trust Fund to such individual (or his Beneficiary) in a lump sum. All such payments shall be made by the Trustee, at the option of the Participant (or his Beneficiary) in Employer Shares, in cash or both.

12.02. Timing of Payments

Unless the Participant or Beneficiary elects otherwise, the payment of retirement, death, disability and termination benefits shall begin no later than 60 days after the close of the Plan Year in which the Participant retires, dies, becomes disabled or otherwise terminates service with the Employer.

Notwithstanding any provisions hereof to the contrary, benefit payments under this Plan shall in all instances commence by the April 1 following the end of the calendar year in which the Participant attains age 70 1/2.

12.03. Installment Payments

Notwithstanding any provisions in this Plan to the contrary, if a Participant's entire interest is to be distributed in other than an immediate lump sum, minimum annual payments under the Plan must be paid over one of the following periods (or a combination thereof):

(a) a period certain not extending beyond the life expectancy of the Participant; or

13

(b) a period certain not extending beyond the joint and last survivor expectancy of the Participant and a designated Beneficiary.

If a Participant's entire interest is to be distributed in other than a lump sum, then the amount to be distributed each year must be at least an amount equal to the quotient obtained by dividing the Participant's entire interest by the life expectancy of the Participant or joint and last survivor expectancy of the Participant and designated Beneficiary. If the Participant's Spouse is not the designated Beneficiary, the method of distribution selected must assure that at least 50% of the present value of the amount available for distribution is paid within the life expectancy of the Participant.

12.04. Distributions After Death

If the distribution of the Participant's Account has begun and he dies before his entire Account has been distributed to him, the remaining portion of such Account will be distributed at least as rapidly as under the method of distribution being used prior to the Participant's death.

Subject to the succeeding paragraph, if the Participant dies before his distribution has begun, his entire Account shall be distributed within five years of his death unless (a) a portion of his Account is payable to or on behalf of a designated Beneficiary; (b) such portion will be distributed over the life of such designated Beneficiary; and (c) such distribution begins not later than one year after the date of the Participant's death (or such date as prescribed by the Secretary of Treasury).

Notwithstanding the preceding paragraph if the designated Beneficiary is the Participant's Surviving Spouse, the date by which distribution must commence under (c) in the preceding paragraph shall be the date the Participant would have attained age 70 1/2. If the Surviving Spouse dies before distribution to said Spouse begins, this section shall apply as if the Surviving Spouse were the Participant. Life expectancy of a Surviving Spouse may be recalculated annually; however, in the case of any other designated Beneficiary, such life expectancy will be calculated at the time that payment first commences without further calculations. In addition, any amount paid to a child of the Participant will be treated as if it had been paid

14

to the Surviving Spouse if the amount becomes payable to the Surviving Spouse when the child reaches the age of majority.

The provisions of this Section 12.04 are subject to the provisions of
Section 12.01 hereof.

12.05. Cash-Outs

If for any reason a Participant terminates service and the value of his nonforfeitable Accounts does not exceed (or at the time of any prior distribution has not exceeded) $3,500, the Participant shall receive a distribution of the value of the entire nonforfeitable portion of such Accounts as soon as administratively feasible after the first Valuation Date following his date of termination; and the remainder of such Accounts will be treated as a Forfeiture. For purposes of this section, if the value of a Participant's nonforfeitable Accounts is zero, the Participant shall be deemed to have received a distribution of such nonforfeitable Account.

If a Participant receives a distribution pursuant to this Section which is less than the value of his Employer Contributions Account and resumes employment covered under this Plan, the Participant's Accounts will be restored to the amount on the date of distribution if he repays to the Plan the full amount of his distribution before the earlier of (a) five years after the first date on which the Participant is subsequently reemployed by the Employer; or (b) the date on which he incurs five consecutive One Year Breaks in Service following the date of distribution.

12.06. Put Option

Except as otherwise provided in this Section 12.06, any Employer Shares which are not publicly traded at the time they are distributed to Participants or former Participants shall be subject to a put option which will permit the Participant to put those Employer Shares to the Employer. Put options shall be exercisable at least during the 16-month period which begins on the date the Employer Shares subject to the option are distributed by this Plan. Such an option may be exercised by the holder of the Shares notifying the Employer in writing that the put option is being exercised. The price at which the put option must be exercisable is the fair market value of the Shares

15

determined in accordance with the provisions of Treasury Regulation section 54.4975-11(d)(5).

If, pursuant to this Section, the Employer is required to repurchase Employer Shares which are distributed to a Participant within one taxable year in a distribution that represents the balance to the credit of the Participant's Account, the amount to be paid for such Employer Shares shall be paid in substantially equal periodic payments (not less frequently than annually) over a period beginning not later than 30 days after the exercise of the put option described in this Section and not exceeding five years. Adequate security shall be provided and reasonable interest shall be paid on the unpaid amounts referred to in the preceding sentence.

If, pursuant to this Section, the Employer is required to repurchase Employer Shares which are distributed to a Participant as part of an installment distribution, the amount to be paid for such Employer Shares shall be paid not later than 30 days after the exercise of the put option described in this Section.

Notwithstanding any provision of this Plan to the contrary, to the extent that the Employer is prohibited by law from redeeming or purchasing it own securities, consistent with the provisions of Section 409(h)(3) of the Code, Employer Shares under this Plan shall not be subject to the put option described in this Section 12.06 and, as such, a Participant will not be permitted to put such Employer Shares to the Employer.

12.07. Right of First Refusal

(a) During any period when Employer Shares are not publicly traded, all distributions of Employer Shares to any Participant or his Beneficiary by the Plan shall be subject to a "right of first refusal" upon the terms and conditions hereinafter set forth. The "right of first refusal" shall provide that prior to any transfer (as determined by the Plan Administrator) of the Employer Shares, the Participant or Beneficiary must first offer to sell such shares to the Plan; and if the Plan refuses to exercise its right to purchase the Employer Shares, then the Employer shall have a "right of first refusal" to purchase such Shares. Neither the Plan nor the Employer shall be required to exercise the "right of first

16

refusal." This Section 12.07 shall not be operative unless and until the Board of Directors of the Employer so directs.

(b) The terms and conditions of the "right of first refusal" shall be determined as follows:

(i) If the Participant or Beneficiary receives a bona fide offer for the purchase of all or any part of his Employer Shares from a third party, the Participant or Beneficiary shall forthwith deliver (by registered mail, return receipt requested) a copy of any such offer to the Plan Administrator. The Trustee (as directed by the Plan Administrator) or the Employer, as the case may be, shall then have 14 days after receipt by the Plan Administrator of the written offer to exercise the right to purchase all or any portion of the Employer Shares.

(ii) The selling price and other terms under the "right of first refusal" must not be less favorable to the Participant or Beneficiary than the purchase price and other terms offered by a buyer other than the Employer or the Plan, making a good faith offer to purchase the security.

12.08. Eligible Rollover Distributions

(a) Notwithstanding any provision of this Plan to the contrary that would otherwise limit a distributee's election under the Plan, a distributee may elect at the time and in the manner prescribed by the Plan Administrator, to have any portion of an eligible rollover distribution made on or after January l, 1993 paid directly to an eligible retirement plan specified by the distributee in a direct rollover.

(b) The following definitions will apply for purposes of this Section 12.08:

(i) Eligible rollover distribution: An eligible rollover distribution is any distribution of all or any portion of the balance to the credit of the distributee, except that an eligible rollover distribution does not include: (A) any distribution that is one of a series of substantially equal periodic

17

payments (not less frequently than annually) made for the life (or life expectancy) of the distributee or the joint lives (or joint life expectancies) of the distributee and the distributee's designated Beneficiary; (B) any distribution that is for a specified period of ten years or more; (C) any distribution to the extent such distribution is required under Code Section 401(a)(9); and (D) the portion of any distribution that is not includable in gross income (determined without regard to the exclusion for net unrealized appreciation with respect to employer securities).

(ii) Eligible retirement plan: An eligible retirement plan is an individual retirement account described in Code
Section 408(a), an individual retirement annuity described in Code Section 408(b), an annuity plan described in Code Section 403(a) or a qualified trust described in Code Section 401(a) that accepts the distributee's eligible rollover distribution. However, in the case of an eligible rollover distribution to the Surviving Spouse, an eligible retirement plan is an individual retirement account or individual retirement annuity.

(iii) Distributee: A distributee includes an Employee or former Employee. In addition, the Spouse or Surviving Spouse of an Employee or former Employee is a distributee with regard to the interest of the Spouse or Surviving Spouse.

(iv) Direct rollover: A direct rollover is a payment by the Plan to the eligible retirement plan specified by the distributee.

SECTION l3

BREAK IN SERVICE RULES

13.01. Effect of Break in Service on Eligibility

If a Participant terminates his employment with the Employer and subsequently resumes employment after incurring a

18

One Year Break in Service, the rehired Participant shall again participate in the Plan as of the date of his reemployment.

13.02. Effect of Break in Service on Vesting

In the case of a Participant who has five or more consecutive One-Year Breaks in Service, Years of Service performed by such Participant after such One-Year Breaks in Service will be disregarded for the purpose of determining the vested percentage of any Employer Contributions that accrued to his Account before the commencement of such One-Year Breaks in Service. Accordingly, upon the occurrence of five consecutive One-Year Breaks in Service, the non-vested portion of the Participant's Account, if any, shall be treated as a Forfeiture.

Moreover, if a Participant incurs five or more consecutive One-Year Breaks in Service, such Participant's pre-break service will be disregarded in determining the vested percentage of any post-break Employer Contributions that accrue to his Account if (a) he has no vested interest in his Account at the time of his separation from service, and (b) upon returning to service, the number of his consecutive One-Year Breaks in Service is greater than the number of his pre-break Years of Service.

Separate accounts will be maintained for the Participant's pre-break and post-break Employer contributions. Both accounts will share in the earnings and losses of the Trust Fund.

In the case of a Participant who does not have five consecutive One-Year Breaks in Service, both pre-break and post- break Years of Service will count in determining the vested percentage of pre-break and post-break Employer contributions that accrue to his Account.

13.03. Authorized Leaves of Absence

Authorized leaves of absence, as determined by the Plan Administrator, including military service recognized by law as leave of absence, will be included in determining Years of Service for both eligibility and vesting purposes. All Employees in similar circumstances will be treated alike.

19

SECTION 14

TRUST AGREEMENT

14.01. Description of Trust Agreement

The Employer proposes to enter into a Trust Agreement with the Trustee to provide for the administration of the Trust Fund. The Trust Agreement shall be deemed to form a part of this Plan, and any and all rights or benefits which may accrue to any person under this Plan shall be subject to all the terms and provisions of the Trust Agreement. The Plan is designed to invest primarily in Employer Shares. If and to the extent that Employer Shares are not available at a price acceptable to the Trustee, the Trustee is authorized to make other investments as provided in the Trust Agreement.

SECTION 15

PLAN ADMINISTRATION

15.01. Plan Administrator

The Plan shall be administered by a Plan Administrator. Such Plan Administrator shall be a committee of one or more entities or individuals who shall be appointed by and serve at the pleasure of the Employer. In the event that no such appointment is made, Home City Financial Corporation shall serve as Plan Administrator.

15.02. Duties of Plan Administrator

The Plan Administrator shall supervise the maintenance of such accounts and records as shall be necessary or desirable to show the contributions of the Employer, allocation to Participants' Accounts, payments from Participants' Accounts, valuations of the Trust Fund and all other transactions pertinent to the Plan.

The Plan Administrator is authorized to perform all functions necessary to administer the Plan, including, without limitation, to determine the eligibility and qualification of Employees for benefits under the Plan; to determine the allocation and vesting of contributions, earnings and profits of

20

the Plan; to interpret and construe the terms of Plan; to adopt rules, regulations and procedures consistent therewith and to decide all disputes with respect to the rights and obligations of Participants in the Plan. If the Trust Agreement permits, the Plan Administrator may direct the Trustee with respect to investment of the assets of the Trust Fund or may employ investment counsel to do so. The Plan Administrator will have absolute discretion in carrying out its duties and responsibilities under this paragraph.

The Plan Administrator may employ one or more persons to render advice with regard to any responsibility it has under the Plan and may designate others to carry out any of' its responsibilities.

SECTION 16

AMENDMENTS

16.01. Employer's Right to Amend Plan

The Employer shall have the right at any time, by an instrument in writing, to modify, alter or amend this Plan in whole or in part; provided, that no such change shall in any way affect the vested rights of the Employees under this Plan; and provided further, that the provisions of this Plan with respect to the amount, price and timing of awards to officers shall not be amended more than once every six months, other than to comply with applicable provisions of the Code, ERISA or regulations thereunder. If an amendment changes the nonforfeitable rights provided in Section 11, each Participant having not less than three Years of Service may elect, during the period beginning when the amendment is adopted and ending no earlier than the latest of (a) 60 days after the amendment's adoption; (b) 60 days after the amendment's effective date; or
(c) 60 days after the Participant is issued a written notice of the amendment, to have his nonforfeitable rights computed without regard to such amendment. No amendment to the Plan shall decrease a Participant's Account balance or eliminate an optional form of distribution. Any amendment to the Plan shall be executed by any individual authorized by the Board of Directors of the Employer.

21

SECTION 17

DISTRIBUTIONS ON PLAN TERMINATION

17.01. Full Vesting on Plan Termination

When and if this Plan is terminated, or upon dissolution or liquidation of the Employer, after the payment of all expenses and after all adjustments of Participants' Accounts to reflect such expenses, fund profits or losses, income and allocations-to date of termination, each Participant shall be entitled to receive that number of Employer Shares as is then credited to his Accounts and the net value of other assets of such Accounts.

17.02. Payment on Plan Termination

The Plan Administrator shall make payment of each Participant's Account in cash or Employer Shares. Such payment shall be made to each Participant in a single lump sum payment.

17.03. Discontinuance of Contributions; Partial Termination of Plan

Any complete discontinuance of contributions by the Employer or partial termination of the Plan will be treated as a termination with all affected Participants acquiring nonforfeitable interests in amounts contributed to such date of termination.

SECTION 18

CREDITORS OF PARTICIPANTS

18.01. Non-Assignability

Except to the extent permitted by ERISA, assignment, pledge or encumbrance of any character of the benefits under the Plan is not permitted or recognized under any circumstances; and such benefits shall not be subject to claims of creditors, execution, attachment, garnishment or any other legal process.

22

18.02. Qualified Domestic Relations Orders

Section 18.01 shall also apply to the creation, assignment or recognition of a right to any benefit payable with respect to a Participant pursuant to a domestic relations order, unless such order is determined to be a qualified domestic relations order [as defined in Section 414(p) of the Code], or any domestic relations order entered before January l, 1985.

SECTION 19

CLAIMS PROCEDURES

19.01. Filing a Claim for Benefits

A Participant or Beneficiary, or the Employer acting on behalf of such Participant or Beneficiary, shall notify the Plan Administrator of a claim for benefits under the Plan. Such request shall be in writing to the Plan Administrator and shall set forth the basis of such claim and shall authorize the Plan Administrator to conduct such examinations as may be necessary to determine the validity of the claim and to take such steps as may be necessary to facilitate the payment of benefits to which the Participant or Beneficiary may be entitled under the terms of the Plan.

A decision by the Plan Administrator shall be made promptly and not later than 90 days after the Plan Administrator's receipt of the claim for benefits under the Plan, unless special circumstances require an extension of the time for processing, in which case a decision shall be rendered as soon as possible, but not later than 180 days after the initial receipt of the claim for benefits.

19.02. Denial of Claim

Whenever a claim for benefits by any Participant or Beneficiary has been denied by the Plan Administrator, a written notice prepared in a manner calculated to be understood by the Participant or Beneficiary shall be provided setting forth (a) the specific reasons for the denial; (b) the specific reference to the pertinent Plan provisions on which the denial is based; (c) a description of any additional material or information necessary for the claimant to perfect the claim and an

23

explanation of why such material or information is necessary; and (d) an explanation of the Plan's claim review procedure.

19.03. Remedies Available to Participants

Upon denial of his claim by the Plan Administrator, a Participant or Beneficiary

(a) may request a review by a named fiduciary, other than the Plan Administrator, upon written application to the Plan;

(b) may review pertinent Plan documents; and

(c) may submit issues and comments in writing to a named fiduciary.

A Participant or Beneficiary shall have 60 days after receipt by the claimant of written notification of a denial of a claim to request a review of a denied claim.

A decision by a named fiduciary shall be made promptly and not later than 60 days after the named fiduciary's receipt of a request for review, unless special circumstances require an extension of the time for processing; in which case, a decision shall be rendered as soon as possible, but not later than 120 days after receipt of a request for review. The decision on review by a named fiduciary shall be in writing and shall include specific reasons for the decision, written in a manner calculated to be understood by the claimant, and specific references to the pertinent Plan provisions on which the decision is based.

SECTION 20

VOTING RIGHTS

20.01. Participant Voting Rights with Respect to Allocated Shares

All Employer Shares held in the Trust Fund and allocated to Participants' Accounts shall be voted by the Trustee pursuant to written instructions received from the Participants. With respect to Allocated Shares for which the Trustee does not

24

receive written instructions from Participants, such Shares shall be voted by the Trustee in its sole discretion.

20.02. Participant Voting Rights with Respect to Unallocated Shares

All Employer Shares held in the Trust Fund and not allocated to Participants' Accounts shall be voted by the Trustee in its sole discretion.

SECTION 21

TOP HEAVY RULES

21.01. Definitions

If the Plan is or becomes top heavy in any Plan Year, the provisions of this Section 21 will supersede any conflicting provisions in the Plan. The following definitions and rules are necessary to comply with related federal tax requirements:

(a) Key Employee: Any Employee or former Employee (and the Beneficiaries of such Employee) who at any time during the determination period was (i) an officer of the Employer if such individual's annual compensation exceeds 50% of the dollar limitation under Code Section 415(b)(1)(A); (ii) an owner (or considered an owner under Code Section 318) of one of the ten largest interests in the Employer if such individual's annual compensation exceeds the dollar limitation under Code Section 415(c)(l)(A); (iii) a 5% owner of the Employer; or
(iv) a 1% owner of the Employer who has annual compensation of more than $150,000. For purposes of this section, annual compensation means compensation as defined in Code Section 415(c)(3), but including amounts contributed by the Employer pursuant to a salary reduction agreement which are excludable from the Employee's gross income under Code Section 125, 402(a)(8), 402(h) or 403(b). The determination period is the Plan Year containing the Determination Date and the four preceding Plan Years. The determination of who is a Key Employee will be made in accordance with Code Section 416(i)(1) and the regulations thereunder.

(b) Non-Key Employee: Any Employee or former Employee of the Employer who is not a Key Employee. The Beneficiary of a Non-Key Employee will be treated as a Non-Key Employee, and the

25

Beneficiary of a former Non-Key Employee will be treated as a former Non-Key Employee.

(c) Determination Date: For any Plan Year subsequent to the first Plan Year, the last day of the preceding Plan Year. For the first Plan Year, the last day of such Plan Year.

(d) Permissive Aggregation Group: The Required Aggregation Group of plans plus any other plan or plans of the Employer which, when considered as a group with the Required Aggregation Group, would continue to satisfy the requirements of Code Sections 401(a)(4) and 410.

(e) Required Aggregation Group: (i) Each qualified plan of the Employer in which at least one Key Employee participates or participated at any time during the determination period (regardless of whether the Plan has terminated); and
(ii) any other qualified plan of the Employer which enables a plan described in
(i) to meet the requirements of Code Sections 401(a)(4) or 410.

(f) Top-Heavy Plan: The Plan, if it meets the requirements of Section 21.02.

21.02. Top Heavy Status

This Plan, and any other plans aggregated with it, will become top heavy pursuant to this Section 21.02, as of the Determination Date, if the present value of accrued benefits for Key Employees is more than 60% (90% in the case of "super top heavy") of the sum of the present value of accrued benefits of all Employees, excluding former Key Employees. In the case of more than one plan which is to be aggregated, the present value of the accrued benefits (including distributions for Key Employees and all Employees) is first determined separately for each plan as of each plan's determination date. The plans then will be aggregated by adding the results of each plan as of the determination dates for such plans that fall within the same calendar year. The combined results will indicate whether the plans are top heavy.

The account balances and accrued benefits of a Participant who has not been credited with an Hour of Service for

26

the Employer maintaining the Plan during the five-year period ending on the Determination Date will be disregarded.

The present value of accrued benefits as of the Determination Date for any individual is the sum of (a) the Account balance as of the most recent Valuation Date occurring within a 12-month period ending on the Determination Date; (b) an adjustment for contributions due as of the Determination Date; and (c) the aggregate distributions made with respect to such individual under the Plan during the five-year period ending on the Determination Date. For an employee stock-ownership plan, the adjustment in (b) is generally the amount of contributions actually made after the Valuation Date but on or before the Determination Date.

In determining whether the Plan is top heavy, it must be aggregated with each plan included in the Required Aggregation Group. In addition, the Employer may aggregate plans included in the Permissive Aggregation Group.

21.03. Minimum Contributions

For each Plan Year in which the Plan is top heavy, each Participant who is a Non-Key Employee (including those Participants who did not complete 1,000 Hours of Service in the Plan Year) must receive an annual allocation of contributions and Forfeitures (disregarding Social Security benefits) equal to at least 3% of his Compensation; provided that if the largest percentage of Compensation allocated to a Key Employee for a Plan Year is less than 3%, that largest percentage will be substituted for 3%. For any year in which the Employer maintains a defined benefit plan in addition to this Plan, the requirements of this paragraph will be satisfied by providing each Non-Key Employee with the minimum annual benefit provided under the top heavy provisions of the defined benefit plan. For any year in which the Employer maintains another defined contribution plan in addition to this Plan, the minimum benefit described in this paragraph shall be provided by such other defined contribution plan.

SECTION 22

EXEMPT LOANS

27

22.01. Authority to Borrow

The Trustee may borrow funds on behalf of the Plan to purchase Employer Shares, provided that any Plan loan is an exempt loan within the meaning of Treasury Regulation Section 54.4975-7(b)(l)(iii).

22.02. Requirements for Plan Loans

Any loan made to the Plan pursuant to this Section 22 must meet the following requirements:

(a) The proceeds of the loan must be used within a reasonable time after their receipt by the Plan either (i) to acquire Employer Shares; (ii) to repay such loan; or (iii) to repay a prior exempt loan.

(b) The interest rate of the loan must not be in excess of a reasonable rate of interest. All relevant factors will be considered in determining a reasonable rate of interest, including the amount and duration of the loan, the security and guarantee (if any) involved, the credit standing of the Plan and the guarantor (if any) and the interest rate prevailing for comparable loans.

(c) The loan must be for a specific term. Such loan may not be payable at the demand of any person, except in the case of default.

(d) The loan must be without recourse against the Plan. Furthermore, the only assets of the Plan that may be given as collateral for the loan are Employer Shares of two classes--those acquired with the proceeds of the loan and those that were used as collateral on a prior exempt loan repaid with the proceeds of the current loan. No person entitled to payment under the exempt loan shall have any rights to assets of the Plan other than (i) collateral given for the loan; (ii) contributions (other than contributions of Employer Shares) that are made under the Plan to meet its obligations under the loan; and (iii) earnings attributable to such collateral and the investment of such contributions.

(e) The loan must provide for the release from encumbrance of Plan assets used as collateral for the loan. For

28

each Plan Year during the duration of the loan, the number of securities released must equal the number of encumbered securities held immediately before release for the current Plan Year multiplied by a fraction. The numerator of the fraction is the amount of principal and interest paid for the year. The denominator of the fraction is the sum of the numerator plus the principal and interest to be paid for all future years. The number of future years under the loan must be definitely ascertainable and must be determined without taking into account any possible extensions or renewal periods. If the interest rate under the loan is variable, the interest to be paid in future years must be computed by using the interest rate applicable as of the end of the Plan Year. If collateral includes more than one class of securities, the number of securities of each class to be released for a Plan Year must be determined by applying the same fraction to each class.

(f) All other requirements of Treasury Regulation Section 54.4975-7(b).

SECTION 23

MISCELLANEOUS

23.01. Employment Rights

The right of the Employer to terminate the employment of any of its Employees shall not in any way be affected by the Employee's participation in this Plan.

23.02. Gender

Wherever used in this Plan the masculine pronoun refers to both men and women.

23.03. Notice Requirement

Notice of the existence and provisions of the Plan and of any amendment thereto shall be communicated by the Employer to those entitled to notice thereof.

29

23.04. Merger or Consolidation

In case of any merger or consolidation with, or transfer of assets or liabilities to, any other plan, each Participant in the Plan would (if this Plan then terminated) receive a benefit immediately after the merger, consolidation or transfer which is equal to, or greater than, the benefit he would have been entitled to receive immediately before the merger, consolidation or transfer (if the Plan then terminated).

23.05. Social Security Benefits

Post-separation Social Security benefit increases shall not affect benefits under this Plan.

23.06. Forfeitures

Forfeitures resulting from termination of employment shall be allocated to other Participants as of the first day of the month coincident with or following the earlier of the date on which the Participant (a) receives an actual distribution of his nonforfeitable Account; or (b) incurs five consecutive One-Year Breaks in Service. In the event that a Participant who received a distribution of his nonforfeitable Account returns to the employment of the Employer before he incurs five consecutive One Year Breaks in Service and takes such action as is necessary to reinstate the portion of his account that was previously forfeited, the forfeited portion of his Account shall be restored first from Forfeitures available for allocation in that year and then from additional Employer contributions, if necessary.

23.07. Named Fiduciaries

The named fiduciary of this Plan shall be Home City Financial Corporation.

23.08. Limitations on Payment

No payment shall be made to any incompetent person (through minority or otherwise) until the Plan Administrator shall have been furnished evidence satisfactory to it of the person to whom such payment shall be made and his right to receive the same. Until furnished such evidence, all amounts so payable shall be held in trust for the person or persons entitled

30

to receive them, separate and apart from the Plan's general Trust Fund.

23.09. Interpretation of Document

The construction and interpretation of the Plan provisions are vested with the Plan Administrator, in its absolute discretion, including, without limitation, the determination of benefits, eligibility and interpretation of Plan provisions. All such decisions, determinations and interpretations shall be final, conclusive and binding upon all parties having an interest in the Plan.

23.10. Nonterminable Protections and Rights

Notwithstanding anything contained herein to the contrary, no security acquired with the proceeds of an exempt loan may be subject to a put, call or other option, or buy-sell or similar arrangement while held by and or distributed from this Plan. The rights and protections specified in the preceding sentence, together with the put option rights provided for in Section 12.06 hereof, shall be non-terminable regardless of whether this Plan ceases to be an employee stock ownership plan or an exempt loan is paid in full.

23.11. Use of Income With Respect to Employer Shares

The Plan reserves the right to use income with respect to Employer Shares acquired with the proceeds of an exempt loan to repay such loan.

SECTION 24

CERTAIN DEFINITIONS

Whenever used in this Plan, the following words and phrases shall have the meanings specified below. Additional words and phrases may be defined in the text of the Plan.

24.01. Account

"Account" means a Participant's Employer Contributions Account.

31

24.02. Adjustment Factor

"Adjustment Factor" means the cost-of-living adjustment prescribed by the Secretary of the Treasury under Code Section 415(d) for years beginning after December 31, 1987, as applied to such items and in such manner as the Secretary shall provide.

24.03. Affiliate

"Affiliate" means any other employer which, together with Home City Financial Corporation, is a member of a controlled group of corporations or of a commonly controlled trade or business [as defined in Code Sections 414(b) and
(c) and as modified by Code Section 415(h)] or of an affiliated service group
[as defined in Code Section 414(m)] or other organization described in Code
Section 414(o).

24.04. Annual Additions

"Annual Additions" means the sum of the following amounts credited to a Participant for the Limitation Year under all defined contribution plans maintained by the Employer:

(a) Employer contributions;

(b) Forfeitures;

(c) amounts allocated after March 31, 1984 to an individual medical account, as defined in Section 415(l) (l) of the Code, which is part of a defined benefit plan maintained by the Employer; and

(d) amounts derived from contributions paid or accrued after December 31, 1985 in taxable years ending after such date which are attributable to post-retirement medical benefits allocated to the separate account of a key employee [as defined in Section 416(i) of the Code] under a welfare benefit fund [as defined in Section 419(e) of the Code] maintained by the Employer. The amounts described under this paragraph (d) shall not be subject to the 25% of compensation limit provided in Section 2.04.

24.05. Beneficiary

32

"Beneficiary" means the individual, individuals or trust designated by the Participant under the terms of Section 8.02 hereof to receive the death benefit payable under the Plan.

24.06. Code

"Code" means the Internal Revenue Code of 1986, as may be amended from time to time, and corresponding provisions of future federal internal revenue codes.

24.07. Compensation

"Compensation" means compensation, as defined in Section 2.04 hereof, including, to the extent applicable, Earned Income; provided, however, that Compensation shall not include (i) any amounts paid or accrued to Participant during any Plan Year under any Recognition and Retention Plan adopted by the Employer after the Effective Date, or (ii) any amounts paid by the Employer during any Plan Year in excess of $150,000, adjusted under Code Section
401(a)(17). In determining the compensation of a Participant for purposes of the $150,000 limit, the family aggregation rules of Code Section 414(g)(6) will apply, except in applying such rules, the term "family" will include only the Spouse of the participant and any lineal descendants of the participant who have not attained age 19 before the close of the year. If, as a result of the application of such rules, compensation would exceed the adjusted $150,000 limitation, then the limitation will be prorated among the affected persons in proportion to each such person's compensation as determined under this paragraph prior to the application of this limitation. For purposes of a Participant's first Plan Year of eligibility, only Compensation paid to such Participant after the Entry Date on which he begins to participate in the Plan shall be considered for purposes of determining allocations under Section 3 hereof.

24.08. Current Participant

"Current Participant" means, for any Plan Year, (i) a Participant who was both a Full-Time Employee during such Plan Year and employed by the Employer on the last day of such Plan Year, and (ii) a Participant who died, retired or became totally and permanently disabled during such Plan Year.

24.09. Intentionally Omitted

33

24.10. Effective Date

"Effective Date" means January 1, 1996.

24.11. Employee

"Employee" means any person who is an employee in the regular employment of the Employer. For this purpose, the term "Employee" shall not include any Leased Employee.

24.12. Employer

"Employer" means Home City Financial Corporation and any Affiliate that adopts this Plan pursuant to the provisions of Section 25 hereof.

24.13. Employer Contributions Account

"Employer Contributions Account" means the account established for each Participant under this Plan pursuant to Section 4.01.

24.14. Employer Shares or Shares

"Employer Shares" or "Shares" means securities which constitute "employer securities" under Section 409(l) of the Code and "qualifying employer securities" under Section 4975(e)(8) of the Code and Section 407(d)(5) of ERISA.

24.15. Employment Commencement Date

"Employment Commencement Date" means the date on which an Employee first performs an Hour of Service for the Employer.

24.16. Entry Date

"Entry Date" means January 1 and July l of each year.

24.17. ERISA
- ------------

     "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.

34

24.18. Family Member

"Family Member" means, with respect to any individual, such individual's Spouse and lineal ascendants or descendants and the spouses of such lineal ascendants or descendants.

24.19. Forfeiture

"Forfeiture" means the amount of the value of any Participant's Account that such Participant is not entitled to receive under Section 11 on the termination of his employment.

24.20. Full Time

"Full Time" means employment with the Employer for not less than 1,000 hours during the 12 consecutive calendar months for which a determination is made.

24.21. Highly-Compensated Employee

"Highly-Compensated Employee" means a highly-compensated active employee and a highly-compensated former employee. A highly-compensated active employee includes any Employee who performs service for the Employer during the determination year and who, during the look-back year (a) received compensation from the Employer in excess of $75,000 multiplied by the Adjustment Factor; (b) received compensation from the Employer in excess of $50,000 multiplied by the Adjustment Factor and was a member of the top-paid group for such year; or (c) was an officer of the Employer and received compensation during such year that is greater than 50% of the dollar limitation in effect under Code Section
415(b)(l)(A).

The term Highly-Compensated Employee also includes: (a) Employees who are both described in the preceding paragraph if the term "determination year" is substituted for the term "look-back year" and the Employee is one of the 100 Employees who received the most compensation from the Employer during the determination year; and (b) Employees who are 5% owners at any time during the look-back year or determination year. If no officer has satisfied the compensation requirement of (c) in the preceding paragraph during either a determination year or look-back year, the highest paid officer for such year shall be treated as a Highly-Compensated Employee. For this purpose, the

35

determination year shall be the Plan Year. The look-back year shall be the 12-month period immediately preceding the determination year.

A highly-compensated former Employee includes any Employee who separated from service (or was deemed to have separated) prior to the determination year, performs no service for the Employer during the determination year and was a highly compensated active employee for either the separation year or any determination year ending on or after the Employee's 55th birthday. If an Employee is, during a determination year or look-back year, a Family Member of either a 5% owner who is an active or former Employee or a Highly-Compensated Employee who is one of the 10 most highly-compensated employees ranked on the basis of compensation paid by the Employer during such year, then the Family Member and the 5% owner or top-10 highly-compensated employee shall be aggregated. In such case, the Family Member and 5% owner or top-10 highly-compensated employee shall be treated as a single Employee receiving compensation and Plan contributions or benefits equal to the sum of such compensation and contributions or benefits of the Family Member and 5% owner or top-10 highly-compensated employee.

The determination of who is a Highly-Compensated Employee, including the determinations of the number and identity of Employees in the top-paid group, the top 100 Employees, the number of Employees treated as officers and the compensation that is considered, will be made in accordance with Code Section 414(q) and the regulations thereunder.

24.22. Hour of Service

"Hour of Service" means

(a) each hour for which an Employee is paid, or entitled to payment, for the performance of duties for the Employer or an Affiliate. These hours shall be credited to the Employee for the computation period or periods in which the duties are performed; and

(b) each hour for which an Employee is paid, or entitled to payment, by the Employer or an Affiliate on account of a period of time during which no duties are performed (irrespective of whether the employment relationship has

36

terminated) due to vacation, holiday, illness, incapacity (including disability), layoff, absence for maternity or paternity reasons, jury duty, military duty or leave of absence. No more than 501 hours of service shall be credited under this paragraph for any single continuous period (whether or not such period occurs in a single computation period). Hours under this paragraph shall be calculated and credited pursuant to Section 2530.200b-2 of the Department of Labor Regulations, which are incorporated herein by this reference; and

(c) each hour for which back pay, irrespective of mitigation of damages, is either awarded or agreed to by the Employer or an Affiliate. The same hours of service shall not be credited both under paragraph (a) or paragraph (b), as the case may be, and under this paragraph (c). These hours shall be credited to the computation period or periods to which the award or agreement pertains rather than the computation period in which the award, agreement or payment is made; and

(d) in the case of a Participant who is absent from work for maternity or paternity reasons, such Participant shall have credited, solely for purposes of determining whether a One-Year Break in Service has occurred for eligibility and vesting, in the year in which the absence begins if necessary to prevent a One Year Break in Service for such year; or in the following year, the number of hours that would normally have been credited but for such absence; or in any case in which such hours cannot be determined, 8 hours of service per day of such absence. The total number of hours treated as hours of service under this paragraph shall not exceed 501 hours. For purposes of this paragraph, an absence from work for maternity or paternity reasons means an absence (i) by reason of pregnancy of the Participant; (ii) by reason of the birth of a child of the Participant; (iii) by reason of the placement of a child with the Participant in connection with the adoption of such child by such Participant; or (iv) for purposes of caring for such child for a period beginning immediately following such birth or placement.

24.23. Late Retirement Date

"Late Retirement Date" means the first day of the month following the date on which a Participant elects to retire after his Normal Retirement Date.

37

24.24. Leased Employee

"Leased Employee" means any person (other than an employee of the recipient) who, pursuant to an agreement between the recipient and any other person (leasing organization), has performed services for the recipient [or for the recipient and related persons determined in accordance with Code Sections 414(n) and 414(o)] on a substantially full-time basis for a period of at least one year, and such services are of a type historically performed by employees in the business field of the recipient employer. Contributions or benefits provided a Leased Employee by the leasing organization which are attributable to services performed for the recipient employer shall be treated as provided by the recipient employer.

A Leased Employee shall not be considered an employee of the recipient if
(a) such employee is covered by a money purchase pension plan providing (i) a nonintegrated employer contribution rate of at least 10% of compensation, as defined in Code Section 415(c)(3), but including amounts contributed by the employer pursuant to a salary reduction agreement which are excludable from the employee's gross income under Code Section 125, Section 402(a)(8), Section 402(h) or Section 403(b); (ii) immediate participation; and (iii) full and immediate vesting; and (b) Leased Employees do not constitute more than 20% of the recipient's non-highly-compensated work force.

24.25. Limitation Year

"Limitation Year" means the Plan Year.

24.26. Normal Retirement Age

"Normal Retirement Age" means age 65.

24.27. Normal Retirement Date

"Normal Retirement Date" means the first day of the month coincident with or following the date on which the Participant attains Normal Retirement Age; provided, however, that this Plan shall not be interpreted to require that a Participant retire prior to attaining any specific age.

38

24.28. One-Year Break in Service

"One-Year Break in Service" means, for eligibility and vesting purposes, a Plan Year during which a Participant has not completed more than 500 Hours of Service.

24.29. Participant

"Participant" means either (a) an Employee who is participating in the Plan in accordance with Section 1.01 for whom Accounts are being maintained; or (b) a former Employee for whom Accounts are being maintained.

24.30. Plan

"Plan" means the Home City Financial Corporation Employee Stock Ownership Plan as in effect from time to time.

24.31. Plan Administrator

"Plan Administrator" means the individual(s) or entity(ies) appointed by the Employer to administer this Plan pursuant to Section 15, or if no such appointment is made, Home City Financial Corporation.

24.32. Plan Year

"Plan Year" means the fiscal year of the Plan which begins each January l and ends each December 31.

24.33. Projected Annual Benefit

"Projected Annual Benefit" means the annual benefit to which the Participant would be entitled under all Employer sponsored defined benefit plans, assuming that the Participant continues employment until his Normal Retirement Date, that the Participant's Compensation continues until his Normal Retirement Date at the rate in effect during the current calendar year and that all other factors relevant for determining benefits under the plans remain constant at the level in effect during the current calendar year.

39

24.34. Spouse or Surviving Spouse

"Spouse" or "Surviving Spouse" means an individual who is legally married to the Participant, provided that an individual who was formerly married to the Participant will be treated as the Spouse or Surviving Spouse to the extent provided under a qualified domestic relations order as described in Section 414(p) of the Code.

24.35. Trust Agreement

"Trust Agreement" means the agreement, and any amendments made thereto, by and between the Employer and the Trustee for the management, investment and disbursement of funds held in the Trust Fund.

24.36. Trust Fund

"Trust Fund" means the fund established pursuant to the terms of the Trust Agreement.

24.37. Trustee

"Trustee" means the bank, trust company and/or individual or individuals designated by the Employer to hold and invest the Trust Fund and to pay benefits and expenses as authorized by the Plan Administrator in accordance with the terms and provisions of the agreement by and between the Employer and such bank, trust company and/or individual or individuals.

24.38. Valuation Date

"Valuation Date" means the last day of each Plan Year and any other date fixed by the Plan Administrator for the valuation of assets and adjustments of individual Accounts.

24.39. Year of Service

"Year of Service" means a Plan Year during which a Participant is, and each calendar year prior to the Effective Date during which such Participant was, a Full-Time Employee of the Employer.

40

SECTION 25

MULTIEMPLOYER PROVISIONS

25.01. Adoption by Affiliates of Home City Financial Corporation

Effective as of the Effective Date, any Affiliate may adopt the Plan with the approval of the Board of Directors of Home City Financial Corporation. However, notwithstanding such adoption by any Affiliate, or any other provision of this Plan, Home City Financial Corporation shall have the sole and exclusive right to amend the Plan or Trust Agreement and it shall not be necessary for any adopting Affiliate to execute the original or any amended Plan or Trust Agreement.

25.02. Administration

Home City Financial Corporation shall have the exclusive right to appoint the Plan Administrator under Section 15 hereof, and Home City Financial Corporation and the Plan Administrator shall have exclusive administrative authority over the Plan, although responsibility for those internal matters peculiar to a particular Affiliate may be delegated to that Affiliate.

25.03. Common Fund.

The Trustee of the Plan need not earmark or keep separate the assets attributable to each Affiliate, but may commingle them with assets attributable to other Affiliates. The Trust shall be available to pay benefits to Participants and their Beneficiaries without distinction as to the Affiliate to which particular assets or amounts are attributable.

25.04. Withdrawal - Termination.

Any Affiliate, by action of its Board of Directors or other governing authority, and notice to the Plan Administrator and the Trustee, may withdraw from the Plan, or may terminate the Plan with respect to its employees, without affecting any other Affiliates. A withdrawing Affiliate may arrange for the continuation of this Plan in separate form for its own employees, with such amendments as it may deem proper, and may arrange for

41

continuation of the Plan by merger with an existing plan and trust, and transfer of Trust Fund assets. Notwithstanding anything contained herein to the contrary, by action of its Board of Directors, Home City Financial Corporation, in its absolute discretion, may terminate the entire Plan or an Affiliate's participation at any time, without the consent of any Affiliate, Participant or Beneficiary.

IN WITNESS WHEREOF, the undersigned has caused this Plan to be executed by its duly authorized officer effective as of the Effective Date.

HOME CITY FINANCIAL CORPORATION

By:____________________________

Name (Print):__________________

Title:_________________________

Date:_____________________

42

Exhibit 23.1

CONSENT

We have issued our report dated June 17, 1996, accompanying the financial statements of Home City Federal Savings Bank of Springfield in Forms S-1 and AC and the Prospectus to be filed with the Securities and Exchange Commission and the Office of Thrift Supervision on or about September 20, 1996. We consent to the use of the aforementioned report in the Registration Statement and Prospectus, and all amendments, thereto, and to the use of our name as it appears under the caption "Experts".

ROBB, DIXON, FRANCIS, DAVIS,
ONESON & COMPANY

Granville, Ohio
November 1, 1996


EXHIBIT 99.1

HOME CITY FEDERAL SAVINGS BANK OF SPRINGFIELD
63 WEST MAIN STREET
SPRINGFIELD, OHIO 45502
(513) 324-5736

NOTICE OF SPECIAL MEETING OF MEMBERS

Notice is hereby given that a Special Meeting of Members of Home City Federal Savings Bank of Springfield ("Home City") will be held at the office of Home City, 63 West Main Street, Springfield, Ohio, on December 19, 1996, at _____ __.m., local time (the "Special Meeting"), for the following purposes, all of which are more completely set forth in the accompanying Summary Proxy Statement:

1. To consider and act upon a resolution to approve the Plan of Conversion (the "Plan"), a copy of which is attached to the Summary Proxy Statement as Exhibit A, pursuant to which Home City would convert from a mutual savings bank chartered under the laws of the United States to a permanent capital stock savings bank chartered under the laws of the United States (the "Conversion") and become a wholly-owned subsidiary of Home City Financial Corporation, an Ohio corporation organized for the purpose of acquiring all of the capital stock to be issued by Home City in the Conversion;

2. To consider and act upon a resolution to adopt the Federal Stock Charter of Home City, a copy of which is attached to the Plan as Exhibit I;

3. To consider and act upon a resolution to adopt the Federal Stock Bylaws of Home City, a copy of which is attached to the Plan as Exhibit II; and

4. To transact such other business as may properly come before the Special Meeting and any adjournments thereof.

Only those members of Home City who have a savings deposit at Home City at the close of business on October 31, 1996, and borrowers of record on May 1, 1996, whose loans remain outstanding on October 31, 1996, are members of Home City entitled to notice of and to vote at the Special Meeting and any adjournments thereof. WHETHER OR NOT YOU EXPECT TO ATTEND THE SPECIAL MEETING, WE URGE YOU TO CONSIDER THE ACCOMPANYING SUMMARY PROXY STATEMENT CAREFULLY, TO COMPLETE THE ENCLOSED PROXY CARD(S) AND TO RETURN THE COMPLETED PROXY CARD(S) TO HOME CITY IN THE ENCLOSED POSTAGE-PAID RETURN ENVELOPE AS SOON AS POSSIBLE TO ASSURE THAT YOUR VOTE(S) WILL BE COUNTED.

By Order of the Board of Directors

Douglas L. Ulery,
President

Springfield, Ohio
November 12, 1996


HOME CITY FEDERAL SAVINGS BANK OF SPRINGFIELD
63 WEST MAIN STREET
SPRINGFIELD, OHIO 45502
(513) 324-5736

SUMMARY PROXY STATEMENT

INTRODUCTION

The enclosed proxy (the "Proxy") is being solicited by the Board of Directors of Home City Federal Savings Bank of Springfield (the "Bank") for use at a Special Meeting of Members of Home City to be held at the office of Home City, 63 West Main Street, Springfield, Ohio, on December 19, 1996, at ________ __.m., local time, and at any adjournments thereof (the "Special Meeting"). The Special Meeting is being held for the following purposes:

1. To consider and act upon a resolution to approve the Plan of Conversion (the "Plan"), a copy of which is attached to the Summary Proxy Statement as Exhibit A, pursuant to which Home City would convert from a mutual savings bank chartered under the laws of the United States to a permanent capital stock savings bank chartered under the laws of the United States (the "Conversion") and become a wholly-owned subsidiary of Home City Financial Corporation, an Ohio corporation organized for the purpose of acquiring all of the capital stock to be issued by Home City in the Conversion (the "Holding Company");

2. To consider and act upon a resolution to adopt the Federal Stock Charter of Home City, a copy of which is attached to the Plan as Exhibit I;

3. To consider and act upon a resolution to adopt the Federal Stock Bylaws of Home City, a copy of which is attached to the Plan as Exhibit II; and

4. To transact such other business as may properly come before the Special Meeting and any adjournments thereof.

The Board of Directors of Home City has unanimously adopted the Plan. The Plan has also been approved by the Office of Thrift Supervision (the "OTS"), subject to the approval of the Plan by the members of Home City at the Special Meeting and the satisfaction of certain other conditions.

The approval of the Plan will have the effect of (i) terminating the voting rights of the present members of Home City and (ii) modifying, and eventually eliminating, their right to receive any surplus in the event of a complete liquidation of Home City. Except for certain rights in the special liquidation account established by the Plan (the "Liquidation Account"), such voting and liquidation rights after the Conversion will vest exclusively in the holders of the common shares of HCFC. See "THE CONVERSION - Principal Effects of the Conversion."

During and upon the completion of the Conversion, Home City will continue to provide services to depositors and borrowers pursuant to its current policies, at its existing office. In addition, Home City will continue to be a member of the Federal Home Loan Bank (the "FHLB") of Cincinnati and savings accounts at Home City will continue to be insured up to applicable limits by the Federal Deposit Insurance Corporation (the "FDIC").

This Summary Proxy Statement is dated November 12, 1996, and is first being mailed to members of Home City, together with the Prospectus of HCFC dated November 12, 1996 (the "Prospectus"), in respect of the common shares of HCFC to be issued in connection with the Conversion (the "Common Shares"), on or about November 20, 1996.

1

VOTING RIGHTS AND VOTE REQUIRED FOR APPROVAL

All depositors, including beneficiaries of Individual Retirement Accounts ("IRAs") at Home City, having a savings account of record with Home City on October 31, 1996 (the "Voting Record Date"), and all borrowers of record on the Voting Record Date whose loans were outstanding on May 1, 1996, are members of Home City eligible to vote at the Special Meeting and at any adjournments thereof ("Voting Members"). Voting Members who are depositors will be entitled to cast one vote for each $100, or fraction thereof, of the withdrawable value of their savings accounts on the Voting Record Date. Voting Members who are borrowers will be entitled to cast one vote each. No Voting Member may cast more than 1,000 votes.

A savings account or a loan account in which one or more persons has an interest shall be deemed to be held by only one Voting Member for the purpose of voting at the Special Meeting. Any questions as to the eligibility of a member to vote, the number of votes allocated to each Voting Member or any other matter relating to voting will be resolved at the time of the Special Meeting by reference to the records of Home City.

Home City records disclose that, as of the Voting Record Date, there were _______________ votes entitled to be cast at the Special Meeting, a majority of which are required to approve the Plan. A majority of the votes cast at the Special Meeting are also necessary to adopt the Federal Stock Charter and Federal Stock Bylaws of Home City.

PROXIES

Voting Members may vote in person or by proxy at the Special Meeting. For Voting Members wishing to vote in person, ballots will be distributed at the Special Meeting. For Voting Members wishing to vote by proxy at the Special Meeting, the enclosed Proxy may be completed and given in accordance with this Summary Proxy Statement. Any other proxy held by Home City will not be used by Home City for the Special Meeting.

A Proxy will be voted in the manner indicated thereon or, in the absence of specific instructions, will be voted FOR the approval of the Plan, FOR the adoption of the Amended Articles and FOR the adoption of the Amended Constitution. Without affecting any vote previously taken, a Voting Member may revoke a Proxy at any time before such proxy is exercised by executing and delivering a later dated proxy or by giving Home City notice of revocation in writing or in open meeting at the Special Meeting. Attendance at the Special Meeting will not, of itself, revoke a Proxy.

Proxies may be solicited by the directors, officers and employees of Home City in person or by telephone, telegraph or mail, for use only at the Special Meeting and any adjournments thereof and will not be used for any other meeting. The cost of soliciting Proxies will be borne by Home City.

MANAGEMENT'S RECOMMENDATIONS AND REASONS FOR CONVERSION

THE BOARD OF DIRECTORS RECOMMENDS THAT MEMBERS VOTE FOR THE APPROVAL OF THE PLAN AND FOR THE ADOPTION OF THE FEDERAL STOCK CHARTER AND FEDERAL STOCK BYLAWS.

In unanimously adopting the Plan, the Board of Directors determined that Home City will derive substantial benefits from the Conversion and that the Conversion is in the best interests of Home City, its members and the public. The principal factors considered by Home City's Board of Directors in reaching the decision to pursue a mutual-to-stock conversion are the numerous competitive disadvantages which Home City faces if it continues in mutual form. These disadvantages relate to a variety of factors, including growth opportunities, employee retention and regulatory uncertainty. If Home City is to continue to grow and prosper, the mutual form of organization is the least desirable from a competitive standpoint. Although Home City does not have any specific acquisitions planned at this time, the Conversion will position Home City to take advantage of any acquisition opportunities which may present themselves. Because a conversion to stock form is a time-consuming and complex process, Home City cannot wait until an acquisition is imminent to begin the conversion process.

2

As an increasing number of Home City's competitors convert to stock form and can use stock based compensation programs, Home City, as a mutual, is at a disadvantage when it comes to attracting and retaining qualified management. Home City believes that the ESOP for all employees and the Home City Financial Corporation 1997 Stock Option and Incentive Plan (the "Stock Option Plan") and the Home City Financial Corporation Recognition and Retention Plan (the "RRP") for directors and management are important tools, even though Home City will be required to wait until after the Conversion to implement the Stock Option Plan and the RRP.

Another benefit of the Conversion will be an increase in capital. Notwithstanding Home City's current capital position, the importance of higher levels of capital cannot be ignored. As has been amply demonstrated in the past, changing accounting principles, interest rate shifts and changing regulations can threaten even well-capitalized institutions. As a mutual institution, Home City can only increase capital through retained earnings or the issuance of subordinated debentures, which do not count as Tier I capital for regulatory capital purposes. Capital that may seem unnecessary now may support future growth and help Home City withstand future threats to its capital.

In view of the competitive disadvantages and the ongoing debate about the future of mutual institutions in the wake of regulatory consolidation and other forces, Home City is choosing to reject the uncertainty inherent in the mutual structure in favor of the more widely used, recognized and understood stock form of ownership.

The Conversion will also give members of Home City, at their option, the opportunity to become shareholders of HCFC. No member of Home City will be obligated to subscribe or not to subscribe to common shares of HCFC (the "Common Shares") by voting on the Plan, nor will any member's deposit account be converted into Common Shares by such vote. After completion of the Conversion, Home City will continue to provide the services presently offered to depositors and borrowers, will maintain its existing offices and will retain its existing management and employees.

Upon the consummation of the Conversion the Federal Stock Charter of Home City, a copy of which is attached to the Plan as Exhibit I, and the Federal Stock Bylaws, a copy of which is attached to the Plan as Exhibit II, will be the Charter and Bylaws of Home City as a stock savings bank.

THE BUSINESS OF HCFC

HCFC was incorporated under Ohio law in August 1996 at the direction of Home City for the purpose of serving as the holding company for Home City. HCFC has not conducted and will not conduct any business other than business related to the Conversion prior to the completion of the Conversion. HCFC has received approval of the OTS to acquire the capital stock to be issued by Home City in the Conversion. Upon the consummation of the Conversion, HCFC will be a unitary savings and loan holding company, the principal assets of which will initially be the capital stock of Home City, a loan to the ESOP for the purchase of Common Shares and the investments made with the proceeds retained by HCFC from the sale of Common Shares. See "USE OF PROCEEDS." As a savings and loan holding company, HCFC will be required to register with, and will be subject to examination and supervision by, the OTS. See "REGULATION - OTS Regulations -- Holding Company Regulation" in the Prospectus. The types of business activities in which a unitary savings and loan holding company may engage are virtually unrestricted. See "RISK FACTORS - Legislation and Regulation Which May Adversely Affect Home City's Earnings" in the Prospectus.

The office of HCFC is located at 63 West Main Street, Springfield, Ohio 45502, and its telephone number is (513) 324-5736.

THE BUSINESS OF HOME CITY

Home City is a federal mutual savings bank which has served the Springfield, Ohio, area since 1925. Originally formed under the name "Home City Savings and Loan Association," Home City changed its name to "Home City Federal Savings Bank" on May 1, 1996. As a federal savings bank chartered under the laws of the United States, Home City is subject to supervision and regulation by the OTS and the FDIC and is a member of the FHLB of Cincinnati. The deposits of Home City are insured up to applicable limits by the FDIC in the SAIF. See "REGULATION" in the Prospectus.

3

Home City is principally engaged in the business of making permanent first and second mortgage loans secured by one- to four-family residential and nonresidential real estate located in Home City's primary lending area and investing in U.S. Government and agency obligations, interest-bearing deposits in other financial institutions, mortgage-backed securities, and municipal securities. Home City also originates loans for the construction of residential real estate and loans secured by multifamily real estate (over four units), commercial, consumer and nonresidential real estate. The origination of consumer loans, including unsecured loans and loans secured by deposits, constitutes a growing portion of Home City's lending activities. Loan funds are obtained primarily from deposits, which are insured up to applicable limits by the FDIC, and loan and mortgage-backed securities repayments. See "THE BUSINESS OF HOME CITY - Lending Activities; and - Investment Activities" in the Prospectus.

Interest on loans and mortgage-backed securities is Home City's primary source of income. The principal expense of Home City is interest paid on deposit accounts. Operating results are dependent to a significant degree on the net interest income of Home City, which is the difference between interest earned on loans and mortgage-backed securities and interest paid on deposits. Like most thrift institutions, Home City's interest income and interest expense are significantly affected by general economic conditions and by the policies of various regulatory authorities. See "RISK FACTORS" and "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF HOME CITY" in
the Prospectus.

Home City conducts business from its office at 63 West Main Street, Springfield, Ohio 45502. The telephone number of Home City is (513) 324-5736. See "THE BUSINESS OF HOME CITY" in the Prospectus.

THE CONVERSION

THE OTS HAS APPROVED THE PLAN, SUBJECT TO THE APPROVAL OF THE PLAN BY THE MEMBERS OF HOME CITY ENTITLED TO VOTE ON THE PLAN AND SUBJECT TO THE SATISFACTION OF CERTAIN OTHER CONDITIONS IMPOSED BY THE OTS. OTS APPROVAL DOES NOT CONSTITUTE A RECOMMENDATION OR ENDORSEMENT OF THE PLAN.

GENERAL

On September 3, 1996, the Board of Directors of Home City unanimously adopted a Plan of Conversion and recommended that the voting members of Home City approve the Plan at the Special Meeting to be held on ___________, 1996. During and upon completion of the Conversion, Home City will continue to provide the services presently offered to depositors and borrowers, will maintain its existing offices and will retain its existing management and employees.

Based on the current Valuation Range, between 612,000 and 952,200 Common Shares are expected to be offered in the Subscription Offering and the Community Offering in which preference will be given to natural persons residing in Clark County, Ohio, at a price of $10 per share. Federal regulations require, with certain exceptions, that shares offered in connection with the Conversion must be sold up to at least the minimum point of the Valuation Range in order for the Conversion to become effective. The actual number of shares sold in connection with the Conversion will be determined upon completion of the Conversion in the sole discretion of the Board of Directors based upon the final determination of the pro forma market value of Home City at the completion of the Subscription Offering and the Community Offering. See "Pricing and Number of Common Shares to be Sold."

The Common Shares will be offered in the Subscription Offering to (1) each account holder of Home City who, as of June 30, 1995, had a Qualifying Deposit ("Eligible Account Holders"), (2) the ESOP, (3) each account holder of Home City who, as of September 30, 1996, had a Qualifying Deposit ("Supplemental Eligible Account Holders"), and (4) each account holder of Home City having a savings deposit of record with Home City on October 31, 1996 (the "Voting Record Date"), and each borrower of record on the Voting Record Date whose loan was outstanding on May 1, 1996 (such depositors and borrowers as of October 31, 1996, collectively, the "Voting Members"). Any Common Shares not subscribed for in the Subscription Offering may be sold to the general public in the Community Offering in a manner which will seek to achieve the widest distribution of the Common Shares, but which will give preference to natural persons residing in Clark County, Ohio. Under OTS regulations, the Community Offering must be completed within 45 days after completion

4

of the Subscription Offering, unless such period is extended by Home City with the approval of the OTS. If the Community Offering is determined not to be feasible, an occurrence that is not currently anticipated, the Board of Directors of Home City will consult with the OTS to determine an appropriate alternative method of selling unsubscribed Common Shares. No alternative sales methods are currently planned.

OTS regulations require the completion of the Conversion within 24 months after the date of the approval of the Plan by the Voting Members of Home City. The commencement and completion of the Conversion will be subject to market conditions and other factors beyond Home City's control. Due to changing economic and market conditions, no assurance can be given as to the length of time that will be required to complete the sale of the Common Shares. If delays are experienced, significant changes may occur in the estimated pro forma market value of Home City, together with corresponding changes in the aggregate offering price and the net proceeds realized by HCFC from the sale of the Common Shares. In such circumstances, Home City may also incur substantial additional printing, legal and accounting expenses in completing the Conversion. In the event the Conversion is not successfully completed, Home City will be required to charge all Conversion expenses against current earnings.

The following is a summary of the material aspects of the Conversion. The summary is qualified in its entirety by reference to the provisions of the Plan, a copy of which may be inspected at each office of Home City and at the office of the OTS. The Plan is also filed as an exhibit to the Registration Statement of which this Prospectus is a part, and copies of the Registration Statement may be obtained from the Securities and Exchange Commission (the "SEC"). See "ADDITIONAL INFORMATION AND ORDER FORMS."

PRINCIPAL EFFECTS OF THE CONVERSION

VOTING RIGHTS. Savings account holders who are members of Home City in its mutual form will have no voting rights in Home City as converted and will not participate, therefore, in the election of directors or otherwise control Home City's affairs. After the Conversion, voting rights in Home City will be vested exclusively in HCFC as the sole shareholder of Home City. Voting rights in HCFC will be held exclusively by its shareholders. Each holder of HCFC's Common Shares will be entitled to one vote for each Common Share owned on any matter to be considered by HCFC's shareholders. See "DESCRIPTION OF AUTHORIZED SHARES."

SAVINGS ACCOUNTS AND LOANS. Savings accounts in Home City, as converted, will be equivalent in amount, interest rate and other terms to the present savings accounts in Home City, and the existing FDIC insurance on such deposits will not be affected by the Conversion. The Conversion will not affect the terms of loan accounts or the rights and obligations of borrowers under their individual contractual arrangements with Home City.

TAX CONSEQUENCES. The consummation of the Conversion is expressly conditioned on receipt by Home City of a private letter ruling from the Internal Revenue Service (the "IRS") or an opinion of counsel to the effect that the Conversion will constitute a tax-free reorganization as defined in Section 368(a) of the Code. Home City intends to proceed with the Conversion based upon an opinion rendered by its special counsel, Vorys, Sater, Seymour and Pease, which opinion is an exhibit to the Registration Statement on Form S-1 (File No. 333-12501) filed with the SEC by HCFC, addressing the following federal tax consequences, which are all of the material federal tax consequences of the Conversion:

(1) The Conversion constitutes a reorganization within the meaning of Section 368(a)(1)(F) of the Code, and no gain or loss will be recognized by Home City in its mutual form or in its stock form as a result of the Conversion. Home City in its mutual form and Home City in its stock form will each be a "party to a reorganization" within the meaning of Section 368(B) of the Code;

(2) No gain or loss will be recognized by Home City upon the receipt of money from HCFC in exchange for the capital stock of Home City, as converted;

(3) The assets of Home City will have the same basis in its hands immediately after the Conversion as it had in its hands immediately prior to the Conversion, and the holding period of the assets of Home City after the Conversion will include the period during which the assets were held by Home City before the Conversion;

5

(4) No gain or loss will be recognized to the deposit account holders of Home City upon the issuance to them, in exchange for their respective withdrawable deposit accounts in Home City immediately prior to the Conversion, of withdrawable deposit accounts in Home City immediately after the Conversion, in the same dollar amount as their withdrawable deposit accounts in Home City immediately prior to the Conversion, plus, in the case of Eligible Account Holders and Supplemental Eligible Account Holders, the interests in the Liquidation Account of Home City, as described below;

(5) The basis of the withdrawable deposit accounts in Home City held by its deposit account holders immediately after the Conversion will be the same as the basis of their deposit accounts in Home City immediately prior to the Conversion. The basis of the interests in the Liquidation Account received by the Eligible Account Holders and Supplemental Eligible Account Holders will be zero. The basis of the nontransferable subscription rights received by Eligible Account Holders, Supplemental Eligible Account Holders and Other Eligible Members (hereinafter defined) will be zero (assuming that at distribution such rights have no ascertainable fair market value);

(6) No gain or loss will be recognized to Eligible Account Holders, Supplemental Eligible Account Holders or Other Eligible Members upon the distribution to them of nontransferable subscription rights to purchase Common Shares (assuming that at distribution such rights have no ascertainable fair market value), and no taxable income will be realized by such Eligible Account Holders, Supplemental Eligible Account Holders or Other Eligible Members as a result of their exercise of such nontransferable subscription rights;

(7) The basis of the Common Shares purchased by members of Home City pursuant to the exercise of subscription rights will be the purchase price thereof (assuming that such rights have no ascertainable fair market value and that the purchase price is not less than the fair market value of the shares on the date of such exercise), and the holding period of such shares will commence on the date of such exercise. The basis of the Common Shares purchased other than by the exercise of subscription rights will be the purchase price thereof (assuming in the case of the other subscribers that the opportunity to buy in the Subscription Offering has no ascertainable fair market value), and the holding period of such shares will commence on the day after the date of the purchase;

(8) For purposes of Section 381 of the Code, Home City will be treated as if there had been no reorganization. The taxable year of Home City will not end on the effective date of the Conversion and, immediately after the Conversion, Home City in its stock form will succeed to and take into account the tax attributes of Home City in its mutual form immediately prior to the Conversion, including Home City's earnings and profits or deficit in earnings and profits;

(9) The bad debt reserves of Home City in its mutual form immediately prior to the Conversion will not be required to be restored to the gross income of Home City in its stock form as a result of the Conversion, and immediately after the Conversion such bad debt reserves will have the same character in the hands of Home City in its stock form as they would have had if there had been no Conversion. Home City in its stock form will succeed to and take into account the dollar amounts of those accounts of Home City in its mutual form which represent bad debt reserves in respect of which Home City in its mutual form has taken a bad debt deduction for taxable years ending on or before the Conversion; and

(10) Regardless of book entries made for the creation of the Liquidation Account, the Conversion will not diminish the accumulated earnings and profits of Home City available for the subsequent distribution of dividends within the meaning of Section 316 of the Code. The creation of the Liquidation Account on the records of Home City will have no effect on its taxable income, deductions for additions to reserves for bad debts under Section 593 of the Code or distributions to stockholders under Section 593(e) of the Code.

Home City has received an opinion from Keller & Company, Inc. ("Keller") to the effect that the subscription rights have no ascertainable fair market value because the rights are received by specified persons at no cost, may not be transferred and are of short duration. The IRS could challenge the assumption that the subscription rights have no ascertainable fair market value.

For Ohio tax purposes, the tax consequences of the Conversion will be as follows:

6

(1) Home City is a "financial institution" for State of Ohio tax purposes, and the Conversion will not change such status;

(2) Home City is subject to the Ohio corporate franchise tax on "financial institutions," which is imposed annually at a rate of 1.5% of Home City's equity capital determined in accordance with GAAP, and the Conversion will not change such status;

(3) As a "financial institution," Home City is not subject to any tax based upon net income or net profit imposed by the State of Ohio, and the Conversion will not change such status;

(4) The Conversion will not be a taxable transaction to Home City in its mutual or stock form for purposes of the Ohio corporate franchise tax; however, as a consequence of the Conversion, the annual Ohio corporate franchise tax liability of Home City will increase if the taxable net worth of Home City (i.e., book net worth computed in accordance with GAAP at the close of Home City's taxable year for federal income tax purposes) increases thereby; and

(5) The Conversion will not be a taxable transaction to any deposit account holder or borrower member of Home City in its mutual or stock form for purposes of the Ohio corporate franchise tax and the Ohio personal income tax.

Each Eligible Account Holder, Supplemental Eligible Account Holder and Other Eligible Member is urged to consult his or her own tax advisor with respect to the effect of such tax consequences on his or her own particular facts and circumstances.

LIQUIDATION ACCOUNT. In the unlikely event of a complete liquidation of Home City in its present mutual form, each depositor in Home City would receive a pro rata share of any assets of Home City remaining after payment of the claims of all creditors, including the claims of all depositors to the withdrawable value of their savings accounts. A depositor's pro rata share of such remaining assets would be the same proportion of such assets as the value of such depositor's savings deposits bears to the total aggregate value of all savings deposits in Home City at the time of liquidation.

In the event of a complete liquidation of Home City in its stock form after the Conversion, each savings depositor as of June 30, 1995, and September 30, 1996, would have a claim of the same general priority as the claims of all other general creditors of Home City. Except as described below, each depositor's claim would be solely in the amount of the balance in such depositor's savings account plus accrued interest. The depositor would have no interest in the assets of Home City above that amount. Such assets would be distributed to HCFC as the sole shareholder of Home City.

For the purpose of granting a limited priority claim to the assets of Home City in the event of a complete liquidation thereof to Eligible Account Holders and Supplemental Eligible Account Holders who continue to maintain savings accounts at Home City after the Conversion, Home City will, at the time of Conversion, establish the Liquidation Account in an amount equal to the regulatory capital of Home City as of the latest practicable date prior to the Conversion at which such regulatory capital can be determined. For this purpose, Home City shall use the regulatory capital figure no later than that set forth in its latest statement of financial condition contained in the Prospectus. The Liquidation Account will not operate to restrict the use or application of any of the regulatory capital of Home City.

Each Eligible Account Holder and Supplemental Eligible Account Holder will have a separate inchoate interest (the "Subaccount") in a portion of the Liquidation Account for Qualifying Deposits held on the Eligibility Record Date or the Supplemental Eligibility Record Date, as the case may be.

The balance of each initial Subaccount shall be an amount determined by multiplying the amount in the Liquidation Account by a fraction, the numerator of which is the closing balance in the account holder's account as of the close of business on the Eligibility Record Date or the Supplemental Eligibility Record Date, as the case may be, and the denominator of which is the total amount of Qualifying Deposits of all Eligible Account Holders and Supplemental Eligible Account Holders on the corresponding record date. The balance of each Subaccount may be decreased but will never be

7

increased. If, at the close of business on any annual closing date of Home City subsequent to the respective record dates the balance in the savings account to which a Subaccount relates is less than the lesser of (i) the deposit balance in such savings account at the close of business on any other annual closing date subsequent to the Eligibility Record Date or Supplemental Eligibility Record Date or (ii) the amount of the Qualifying Deposit as of the Eligibility Record Date or the Supplemental Eligibility Record Date, the balance of the Subaccount for such savings account shall be adjusted proportionately to the reduction in such savings account balance. In the event of any such downward adjustment, such Subaccount balance shall not be subsequently increased notwithstanding any increase in the deposit balance of the related savings account. If any savings account is closed, its related Subaccount shall be reduced to zero upon such closing.

In the event of a complete liquidation of the converted Home City (and only in such event), each Eligible Account Holder and Supplemental Eligible Account Holder shall receive from the Liquidation Account a distribution equal to the current balance in each of such account holder's Subaccounts before any liquidation distribution may be made to HCFC as the sole shareholder of Home City. Any assets remaining after satisfaction of such liquidation rights and the claims of Home City's creditors would be distributed to HCFC as the sole shareholder of Home City. No merger, consolidation, purchase of bulk assets or similar combination or transaction with another institution, the deposits of which are insured by the FDIC, will be deemed to be a complete liquidation for this purpose and, in any such transaction, the Liquidation Account shall be assumed by the surviving institution.

COMMON SHARES. SHARES ISSUED UNDER THE PLAN CANNOT AND WILL NOT BE INSURED BY THE FDIC. For a description of the characteristics of the Common Shares, see "DESCRIPTION OF AUTHORIZED SHARES."

INTERPRETATION AND AMENDMENT OF THE PLAN

The Boards of Directors of Home City and HCFC will interpret the Plan. To the extent permitted by law, all interpretations of the Plan by the Boards of Directors of Home City and HCFC will be final. The Plan may be amended by the Boards of Directors of Home City and HCFC at any time before completion of the Conversion with the concurrence of the OTS. If Home City and HCFC determine upon advice of counsel and after consultation with the OTS that any such amendment is material, subscribers will be notified of the amendment and will be provided the opportunity to affirm, increase, decrease or cancel their subscriptions. Any person who does not affirmatively elect to continue his subscription or elects to rescind his subscription before the date specified in the notice will have all of his funds promptly refunded with interest. Any person who elects to decrease his subscription will have the appropriate portion of his funds promptly refunded with interest.

CONDITIONS AND TERMINATION

The completion of the Conversion requires the approval of the Plan and the adoption of the Federal Stock Charter and Federal Stock Bylaws by the Voting Members of Home City at the Special Meeting and the sale of the requisite amount of Common Shares within 24 months following the date of such approval. If these conditions are not satisfied, the Plan will automatically terminate and Home City will continue its business in the mutual form of organization. The Plan may be voluntarily terminated by the Board of Directors at any time before the Special Meeting and at any time thereafter with the approval of the OTS.

SUBSCRIPTION OFFERING

THE SUBSCRIPTION OFFERING WILL EXPIRE AT 4:00 P.M., EASTERN TIME, ON THE SUBSCRIPTION EXPIRATION DATE. SUBSCRIPTION RIGHTS NOT EXERCISED BEFORE THE SUBSCRIPTION EXPIRATION DATE WILL BE VOID, WHETHER OR NOT HCFC HAS BEEN ABLE TO LOCATE EACH PERSON ENTITLED TO SUCH SUBSCRIPTION RIGHTS.

Nontransferable subscription rights to purchase Common Shares are being issued at no cost to all eligible persons and entities in accordance with the preference categories established by the Plan, as described below. Each subscription right may be exercised only by the person to whom it is issued and only for his or her own account. Each person subscribing for shares must represent to HCFC that he or she is purchasing such shares for his or her own account and that he or she has no agreement or understanding with any other person for the sale or transfer of such shares.

8

The number of Common Shares which a person who has subscription rights may purchase will be determined, in part, by the total number of Common Shares to be issued and the availability of such shares for purchase under the preference categories set forth in the Plan and certain other limitations. See "Limitations on Purchases of Common Shares." The sale of any Common Shares pursuant to subscriptions received is contingent upon approval of the Plan by the Voting Members of Home City at the Special Meeting.

The preference categories for the allocation of Common Shares, which have been established by the Plan in accordance with applicable regulations, are as follows:

Category 1. Eligible Account Holders will receive, without payment, nontransferable subscription rights to purchase up to the greater of (i) the amount permitted to be purchased in the Community Offering, (ii) .10% of the total number of Common Shares sold in connection with the Conversion, or (iii) 15 times the product (rounded down to the next whole number) obtained by multiplying the total number of Common Shares sold in connection with the Conversion by a fraction of which the numerator is the amount of the Eligible Account Holder's Qualifying Deposit and the denominator of which is the total amount of Qualifying Deposits of all Eligible Account Holders, in each case on the Eligibility Record Date, subject to the overall purchase limitations set forth in Section 10 of the Plan. See "Limitations on Purchases of Common Shares."

If the exercise of subscription rights in this Category 1 results in an over-subscription, Common Shares will be allocated among subscribing Eligible Account Holders in a manner which will, to the extent possible, make the total allocation of each subscriber equal 100 shares or the amount subscribed for, whichever is less. Any Common Shares remaining after such allocation has been made will be allocated among the subscribing Eligible Account Holders whose subscriptions remain unfilled in the proportion which the amount of their respective Qualifying Deposits on the Eligibility Record Date bears to the total Qualifying Deposits of all subscribing Eligible Account Holders on such date. No fractional shares will be issued. The subscription rights of the Eligible Account Holders are subordinate to the limited priority right of the ESOP set forth in the following paragraph.

Category 2. The ESOP will receive, without payment, nontransferable subscription rights to purchase up to 10% of the Common Shares sold in connection with the Conversion. The subscription rights of the ESOP will be subordinate to the subscription rights in Category 1, except that if the final pro forma market value of Home City exceeds the maximum of the Valuation Range, the ESOP shall have first priority with respect to the amount sold in excess of the maximum of the Valuation Range. If the ESOP is unable to purchase all or part of the Common Shares for which it subscribes due to an oversubscription in Category 1, the ESOP may purchase Common Shares on the open market or may purchase authorized but unissued shares of HCFC. If the ESOP purchases authorized but unissued shares from HCFC, such purchases would have a dilutive effect on the interests of HCFC's shareholders.

Category 3. Supplemental Eligible Account Holders, will receive, without payment, non-transferable subscription rights to purchase up to the greater of (i) the amount permitted to be purchased in the Community Offering, (ii) .10% of the total number of Common Shares sold in connection with the Conversion, or (iii) 15 times the product (rounded down to the next whole number) obtained by multiplying the total number of Common Shares sold in connection with the Conversion by a fraction of which the numerator is the amount of the Supplemental Eligible Account Holder's Qualifying Deposit and the denominator of which is the total amount of Qualifying Deposits of all Supplemental Eligible Account Holders, in each case on the Supplemental Eligibility Record Date, subject to the overall purchase limitations set forth in
Section 10 of the Plan. See "Limitations on Purchases of Common Shares."

If the exercise of subscription rights in this Category 3 results in an over-subscription, Common Shares will be allocated among subscribing Supplemental Eligible Account Holders in a manner which will, to the extent possible, make the total allocation of each subscriber equal 100 shares or the amount subscribed for, whichever is lesser. Any Common Shares remaining after such allocation has been made will be allocated among the subscribing Supplemental Account Holders whose subscriptions remain unfilled in the proportion which the amount of their respective Qualifying Deposits on the Supplemental Eligibility Record Date bears to the total

9

Qualifying Deposits of all subscribing Supplemental Eligible Account Holders on such date. No fractional shares will be issued.

Subscription rights received in this Category 3 will be subordinate to the subscription rights in Categories 1 and 2.

Category 4. All Voting Members who are not Eligible Account Holders or Supplemental Eligible Account Holders ("Other Eligible Members") will receive nontransferable subscription rights to purchase Common Shares in an amount up to the greater of the amount permitted to be purchased in the Community Offering or .10% of the total number of Common Shares sold in connection with the Conversion, subject to the overall purchase limitations set forth in Section 10 of the Plan. See "Limitations on Purchases of Common Shares." In the event of an oversubscription in this Category 4, the available shares will be allocated among subscribing Other Eligible Members on an equitable basis in the same proportion that their respective subscriptions bear to the total amount of all subscriptions in this Category 4.

Subscription rights received in this Category 4 will be subordinate to the subscription rights in Categories 1 through 3.

The Board of Directors may reject any one or more subscriptions if, based upon the Board of Directors' interpretation of applicable regulations, such subscriber is not entitled to the shares for which he or she has subscribed or if the sales of the shares subscribed for would be in violation of any applicable statutes, regulations or rules.

HCFC will make reasonable efforts to comply with the securities laws of all states in the United States in which persons having subscription rights reside. However, no such person will be offered or receive any Common Shares under the Plan who resides in a foreign country or in a state of the United States with respect to which all of the following apply: (i) a small number of persons otherwise eligible to subscribe for shares under the Plan resides in such country or state; (ii) under the securities laws of such country or state, the granting of subscription rights or the offer or sale of Common Shares to such persons would require HCFC or its officers or directors, to register as a broker or dealer or to register or otherwise qualify its securities for sale in such country or state; and (iii) such registration or qualification would be impracticable for reasons of cost or otherwise.

The term "resident" as used herein with respect to the Subscription Offering means any person who, on the date of submission of a stock order form, maintained a bona fide residence within a jurisdiction in which the Common Shares are being offered for sale. If a person is a business entity, the person's residence shall be the location of the principal place of business. If the person is a personal benefit plan, the residence of the beneficiary shall be the residence of the plan. In the case of all other benefit plans, the residence of the trustee shall be the residence of the plan. In all cases, the determination of a subscriber's residency shall be in the sole discretion of Home City and HCFC.

COMMUNITY OFFERING

Concurrently with the Subscription Offering, HCFC is hereby offering Common Shares in the Community Offering, subject to the limitations set forth below, to the extent such shares remain available after the satisfaction of all orders received in the Subscription Offering. If subscriptions are received in the Subscription Offering for at least 952,200 Common Shares, Common Shares may not be available for purchase in the Community Offering. All sales of Common Shares in the Community Offering will be at the same price per share as in the Subscription Offering. THE COMMUNITY OFFERING MAY BE TERMINATED AT ANY TIME AFTER ORDERS FOR AT LEAST 952,200 COMMON SHARES HAVE BEEN RECEIVED, BUT IN NO EVENT LATER THAN ___________, 1996 (THE "COMMUNITY EXPIRATION DATE"), WITHOUT THE CONSENT OF THE OTS.

In the event shares are available in the Community Offering, members of the general public may purchase up to 1% of the Common Shares sold, which is 9,522 Common Shares at the maximum of the Valuation Range, as adjusted. See "Limitations on Purchases of Common Shares." If an insufficient number of shares is available to fill all of the orders received in the Community Offering, the available shares will be allocated in a manner to be determined by the Board of Directors of HCFC, subject to the following:

10

(i) Preference will be given to natural persons who are residents of Clark County, Ohio, the county in which the offices of Home City are located;

(ii) Orders received in the Community Offering will first be filled up to a maximum of 2% of the total number of Common Shares offered, with any remaining shares allocated on an equal number of shares per order basis until all orders have been filled;

(iii) No person, together with any Associate and persons Acting in Concert, may purchase more than 2% of the Common Shares; and

(iv) The right of any person to purchase Common Shares in the Community Offering is subject to the right of HCFC and Home City to accept or reject such purchases in whole or in part.

The term "resident" as used herein with respect to the Community Offering means any natural person who, on the date of submission of a stock order form, maintained a bona fide residence within, as appropriate, Clark County or a jurisdiction in which the Common Shares are being offered for sale.

LIMITATIONS ON PURCHASES OF COMMON SHARES

The Plan provides for certain additional limitations to be placed upon the purchase of Common Shares. To the extent such shares are available, the minimum number of shares that may be purchased by any party is 25. No fractional shares will be issued.

No person, together with Associates and persons Acting in Concert, may purchase more than 2% of the Common Shares. Subject to any required regulatory approval and the requirements of applicable laws and regulations, but without further approval of the members of Home City, purchase limitations may be increased or decreased at the sole discretion of the Boards of Directors of HCFC and Home City at any time. If such amount is increased, persons who subscribed for the maximum amount will be given the opportunity to increase their subscriptions up to the then applicable limit, subject to the rights and preferences of any person who has priority subscription rights. The Boards of Directors of HCFC and Home City may, in their sole discretion, increase the maximum purchase limitation referred to above up to 10%, provided that orders for shares exceeding 5% of the shares to be issued in the Conversion shall not exceed, in the aggregate, 10% of the shares to be issued in the Conversion. In the event that the purchase limitation is decreased after commencement of the Subscription Offering, the order of any person who subscribed for the maximum number of Common Shares shall be decreased by the minimum amount necessary so that such person shall be in compliance with the then maximum number of shares permitted to be subscribed for by such person.

"Acting in Concert" is defined as "knowing participation in a joint activity or independent conscious parallel action towards a common goal" or "a combination or pooling of voting or other interests in the securities of an issuer for a common purpose." Persons shall be presumed to be Acting in Concert with each other if: (i) both are purchasing Common Shares in the Conversion and are (a) executive officers, directors, trustees, or any one who performs, or whose nominee or representative performs, a similar policy making function at a company (other than Home City or HCFC) or principal business units or subsidiaries of a company, or (b) any person who directly or indirectly owns or controls 10% or more of the stock of a company (other than Home City or HCFC); or (ii) one person provides credit to the other for the purchase of Common Shares or is instrumental in obtaining that credit. In addition, if a person is presumed to be Acting in Concert with another person, then the person is presumed to Act in Concert with anyone else who is, or is presumed to be, Acting in Concert with that other person.

For purposes of the Plan, (i) the directors of Home City are not deemed to be Acting in Concert solely by reason of their membership on the Board of Directors of Home City; (ii) an associate of a person (an "Associate") is (a) any corporation or organization (other than Home City) of which such person is an officer, partner or, directly or indirectly, the beneficial owner of 10% or more of any class of equity securities; (b) any trust or other estate in which such person has a substantial beneficial interest or as to which such person serves as trustee or in a similar fiduciary capacity; and (c) any relative or spouse of such person, or relative of such spouse, who either has the same home as such person or who is a director or officer of Home City. Executive officers and directors of Home City and their Associates may not purchase, in

11

the aggregate, more than 34.9% of the total number of Common Shares sold in the Conversion. Shares acquired by the ESOP will not, pursuant to regulations governing the Conversion, be aggregated with the shares purchased by the directors, officers and employees of Home City.

Purchases of Common Shares are also subject to the change in control regulations of the OTS. Such regulations restrict direct and indirect purchases of 10% or more of the stock of any savings association by any person or group of persons Acting in Concert. See "RESTRICTIONS ON ACQUISITION OF HOME CITY AND HCFC AND RELATED ANTI-TAKEOVER PROVISIONS Federal Law and Regulation" in the Prospectus.

After the Conversion, Common Shares, except for shares purchased by officers and directors of HCFC, will be freely transferable, subject to OTS regulations. See "Restrictions on Transferability of Common Shares by Directors and Officers."

PLAN OF DISTRIBUTION

The offering of the Common Shares is made only pursuant to this Prospectus, which is available to all eligible subscribers by mail. See "ADDITIONAL INFORMATION AND ORDER FORMS." Additional copies are available at the offices of Home City. Sales of Common Shares will be made primarily by registered representatives affiliated with Webb. HCFC will rely on Rule 3a4-1 under the Exchange Act, and sales of Common Shares will be conducted within the requirements of Rule 3a4-1, which will permit officers, directors and employees of HCFC and Home City to participate in the sale of Common Shares, in clerical capacities, providing administrative support in effecting sales transactions or answering questions relating to the proper execution of the Stock Order Form, except that officers, directors and employees will not participate in the sale of Common Shares to residents of any state in which such persons have not met such state's requirements for participation. Management of Home City may answer questions regarding the business of Home City. Other questions of prospective purchasers, including questions as to the nature of the investment, will be directed to registered representatives. Management and the employees of Home City have been instructed not to solicit offers to purchase Common Shares or to provide advice regarding the purchase of Common Shares. No officer, director or employee of HCFC or Home City will be compensated in connection with his participation by the payment of commissions or other remuneration based either directly or indirectly on the transactions in the Common Shares.

To assist HCFC in marketing the Common Shares, HCFC has retained Webb, which are broker-dealers registered with the SEC and members of the National Association of Securities Dealers, Inc. (the "NASD"). Webb will consult with and advise HCFC and assist with the sale of the Common Shares on a best efforts basis in connection with the Conversion. The services to be rendered by Webb include assisting HCFC in conducting the Subscription Offering and the Community Offering and educating Home City personnel about the Conversion process. Webb is not obligated to purchase any of the Common Shares.

For its services, Webb has been paid a management fee in the amount of $25,000. Webb will also receive a commission equal to 1.5% of the aggregate purchase price paid for Common Shares sold in the Conversion, excluding purchases by Home City's directors, executive officers, and Associates of such directors and executive officers, and the ESOP. If Webb and HCFC deem necessary, Webb may enter into agreements with other NASD members ("Selected Dealers") for assistance in the sale of the Common Shares, in which event Webb and such Selected Dealers will receive a commission not to exceed 5.5% of the purchase price of Common Shares sold, if any, by the Selected Dealer. In addition, HCFC will reimburse Webb for certain expenses, including reasonable legal fees. Webb is not obligated to purchase any Common Shares.

HCFC and Home City have agreed to indemnify Webb and its directors, officers, employees, agents and any controlling person against any and all loss, liability, claim, damage or expense arising out of any untrue statement, or alleged untrue statement, of a material fact contained in the Summary Proxy Statement or the Prospectus, any application to regulatory authorities, any "blue sky" application, or any other related document prepared or executed by or on behalf of HCFC or Home City with its consent in connection with, or in contemplation of, the Conversion, or any omission therefrom of a material fact required to be stated therein, unless such untrue statement or omission, or alleged untrue statement or omission, was made in reliance upon certain information furnished to Home City by Webb expressly for use in the Summary Proxy Statement or the Prospectus.

12

The Common Shares will be offered principally by the distribution of this Prospectus and through activities conducted at the Conversion Information Center, which will be located at the office of Home City. The Conversion Information Center will be staffed by one or more of Webb's employees, who will be responsible for mailing materials relating to the Offering, responding to questions regarding the Conversion and the Offering and processing stock orders.

A conspicuous legend that the Common Shares are not a federally-insured or guaranteed deposit or account appears on all offering documents used in connection with the Conversion and will appear on the certificates representing the Common Shares. Any person purchasing Common Shares will be required to execute the Stock Order Form certifying such person's knowledge that the Common Shares are not federally-insured or guaranteed and that the purchaser has received a Prospectus and understands the investment risk involved.

EFFECT OF EXTENSION OF COMMUNITY OFFERING

If the Community Offering extends beyond 45 days after the Subscription Expiration Date, persons who have subscribed for Common Shares in the Subscription Offering or in the Community Offering will receive a written notice that until a date specified in the notice, they have the right to increase, decrease or rescind their subscriptions for Common Shares. Any person who does not affirmatively elect to continue his subscription or elects to rescind his subscription during any such extension will have all of his funds promptly refunded with interest. Any person who elects to decrease his subscription during any such extension shall have the appropriate portion of his funds promptly refunded with interest.

USE OF STOCK ORDER FORMS

Subscriptions for Common Shares in the Subscription Offering and the Community Offering may be made only by completing and submitting a Stock Order Form. Any person who desires to subscribe for Common Shares in the Subscription Offering must do so by delivering to HCFC at 63 West Main Street, Springfield, Ohio 45502-1309, by mail or in person, prior to 4:00 p.m., Eastern Time, on December 13, 1996, a properly executed and completed original Stock Order Form, together with full payment of the subscription price of $10 for each share for which subscription is made. Photocopies or telecopies of Stock Order Forms will not be accepted. See "ADDITIONAL INFORMATION AND ORDER FORMS." THE FAILURE TO DELIVER A PROPERLY EXECUTED ORIGINAL ORDER FORM AND FULL PAYMENT IN A MANNER BY WHICH THEY ARE ACTUALLY RECEIVED BY HCFC NO LATER THAN 4:00 P.M. ON THE SUBSCRIPTION EXPIRATION DATE WILL PRECLUDE THE PURCHASE OF COMMON SHARES IN THE OFFERING.

AN EXECUTED STOCK ORDER FORM, ONCE RECEIVED BY HCFC, MAY NOT BE MODIFIED, AMENDED OR RESCINDED WITHOUT THE CONSENT OF HCFC, UNLESS (I) THE COMMUNITY OFFERING IS NOT COMPLETED WITHIN 45 DAYS AFTER THE SUBSCRIPTION EXPIRATION DATE, OR (II) THE FINAL VALUATION OF HOME CITY, AS CONVERTED, IS LESS THAN $6,120,000 OR MORE THAN $9,522,000. IF EITHER OF THOSE EVENTS OCCUR, PERSONS WHO HAVE SUBSCRIBED FOR COMMON SHARES IN THE SUBSCRIPTION OFFERING OR IN THE COMMUNITY OFFERING WILL RECEIVE WRITTEN NOTICE THAT UNTIL A DATE SPECIFIED IN THE NOTICE, THEY HAVE A RIGHT TO AFFIRM, INCREASE, DECREASE OR RESCIND THEIR SUBSCRIPTIONS. ANY PERSON WHO DOES NOT AFFIRMATIVELY ELECT TO CONTINUE HIS SUBSCRIPTION OR ELECTS TO RESCIND HIS SUBSCRIPTION DURING ANY SUCH EXTENSION WILL HAVE ALL OF HIS FUNDS PROMPTLY REFUNDED WITH INTEREST. ANY PERSON WHO ELECTS TO DECREASE HIS SUBSCRIPTION DURING ANY SUCH EXTENSION WILL HAVE THE APPROPRIATE PORTION OF HIS FUNDS PROMPTLY REFUNDED WITH INTEREST.

PAYMENT FOR COMMON SHARES

Payment of the subscription price for all Common Shares for which subscription is made must accompany all completed Stock Order Form in order for subscriptions to be valid. Payment for Common Shares may be made (i) in cash, if delivered in person, (ii) by check, bank draft or money order payable to the order of Home City, or (iii) by authorization of withdrawal from savings accounts in Home City (other than non-self-directed IRAs). Wire transfers will not be accepted. Home City cannot lend money or otherwise extend credit to any person to purchase Common Shares, other than the ESOP.

Payments made in cash or by check, bank draft or money order will be placed in a segregated savings account insured by the FDIC up to applicable limits. Interest will be paid by Home City on such accounts at Home City's passbook

13

rate, currently ____% annual percentage yield, from the date payment is received until the Conversion is completed or terminated. Payments made by check will not be deemed to have been received until such check has cleared for payment.

Instructions for authorizing withdrawals from savings accounts are provided in the Stock Order Form. Once a withdrawal has been authorized, none of the designated withdrawal amount may be used by a subscriber for any purpose other than to purchase Common Shares, unless the Conversion is terminated. All sums authorized for withdrawal will continue to earn interest at the contract rate for such account or certificate until the completion or termination of the Conversion. Interest penalties for early withdrawal applicable to certificate accounts will be waived in the case of withdrawals authorized for the purchase of Common Shares. If a partial withdrawal from a certificate account results in a balance less than the applicable minimum balance requirement, the certificate will be cancelled and the remaining balance will earn interest at Home City's passbook rate subsequent to the withdrawal.

Persons who are beneficial owners of IRAs maintained at Home City do not personally have subscription rights related to such account. The account itself, however, may have subscription rights. In order to utilize funds in an IRA maintained at Home City, the funds must be transferred to a self-directed IRA that permits the IRA funds to be invested in stock. The beneficial owner of the IRA must direct the trustee of the IRA to use funds from such account to purchase Common Shares in connection with the Conversion. Persons who are interested in utilizing IRAs at Home City to subscribe for Common Shares should contact the Home City Conversion Center at (513) 324-3830 for instructions and assistance.

Subscriptions will not be filled by HCFC until subscriptions have been received in the Subscription Offering and the Community Offering for up to 612,000 Common Shares, the minimum point of the Valuation Range. If the Conversion is terminated, all funds delivered to HCFC for the purchase of Common Shares will be returned with interest, and all charges to savings accounts will be rescinded. Subscribers and other purchasers will be notified by mail, promptly on completion of the sale of the Common Shares, of the number of shares for which their subscriptions have been accepted. Certificates representing Common Shares will be delivered promptly thereafter.

If the ESOP subscribes for Common Shares in the Subscription Offering, the ESOP will not be required to pay for the shares subscribed for at the time it subscribes but may pay for such Common Shares upon consummation of the Conversion.

SHARES TO BE PURCHASED BY MANAGEMENT PURSUANT TO SUBSCRIPTION RIGHTS

The following table sets forth certain information regarding the subscription rights intended to be exercised by the directors and executive officers of Home City and their Associates. For purposes of this table, it has been assumed that 720,000 Common Shares will be sold in connection with the Conversion at $10 per share and that a sufficient number of Common Shares will be available to satisfy the intended purchases by directors and executive officers. The number of Common Shares purchased may decrease or increase if fewer than 720,000 Common Shares are sold in connection with the Conversion. See "Pricing and Number of Common Shares to be Sold."

                                                                  Percent           Aggregate
                                                 Total            of total           purchase
Name                                            shares            offering             price
- ----                                            ------            --------             -----

John D. Conroy                                   14,400             2.0%             $144,000
P. Clark Engelmeier                              14,400             2.0               144,000
James Foreman                                    14,400             2.0               144,000
Terry A. Hoppes                                  14,400             2.0               144,000
Douglas L. Ulery                                 14,400             2.0               144,000
Gary E. Brown                                     2,000             0.3                20,000
JoAnn Holdeman                                    1,000             0.1                10,000
                                                -------           -----            ----------

   Total                                         75,000            10.4%             $750,000
                                                 ======            ====              ========

14

All purchases by executive officers and directors of Home City are made for investment purposes only and with no intent to resell.

PRICING AND NUMBER OF COMMON SHARES TO BE SOLD

The aggregate offering price of the Common Shares will be based on the pro forma market value of the shares as determined by an independent appraisal of Home City. Keller, a firm which evaluates and appraises financial institutions, was retained by Home City to prepare an appraisal of the estimated pro forma market value of Home City as converted. Keller will receive a fee of $15,000 for its appraisal, which amount includes out-of-pocket expenses.

The appraisal was prepared by Keller in reliance upon the information contained herein. Keller also considered the following factors, among others:
the present and projected operating results and financial condition of Home City and the economic and demographic conditions in Home City's existing market area; the quality and depth of Home City's management and personnel; certain historical financial and other information relating to Home City and a comparative evaluation of the operating and financial statistics of Home City with those of other thrift institutions; the aggregate size of the offering; the impact of the Conversion on Home City's regulatory capital and earnings potential; the trading market for stock of comparable thrift institutions; the effect of Home City becoming a subsidiary of HCFC; and general conditions in the markets for such stocks.

Keller's valuation of the estimated pro forma market value of Home City, as converted, is $7,200,000 as of September 6, 1996 (the "Pro Forma Value"). HCFC will issue the Common Shares at a fixed price of $10 per share and, by dividing the price per share into the Pro Forma Value, will determine the number of shares to be issued. Applicable regulations also require, however, that the appraiser establish the Valuation Range of 15% on either side of the Pro Forma Value to allow for fluctuations in the aggregate value of the Common Shares due to changes in the market for thrift shares and other factors from the time of commencement of the Subscription Offering until the completion of the Conversion.

As of September 6, 1996, the Valuation Range was from $6,120,000 to $8,280,000, which, based upon a per share offering price of $10, will result in the sale of between 612,000 and 828,000 Common Shares. In the event that Keller determines at the close of the Conversion that the aggregate pro forma value of Home City is higher or lower than the Pro Forma Value, but is nevertheless within the Valuation Range, or is not more than 15% above the maximum point of the Valuation Range, HCFC will make an appropriate adjustment by raising or lowering the total number of Common Shares sold in the Conversion consistent with the final Valuation Range. The total number of Common Shares sold in the Conversion will be determined in the discretion of the Board of Directors consistent with the Valuation Range. If, due to changing market conditions, the final valuation is not between the minimum of the Valuation Range and 15% above the maximum of the Valuation Range, subscribers will be given a notice of such final valuation and the right to affirm, increase, decrease or rescind their subscriptions. Any person who does not affirmatively elect to continue his subscription or elects to rescind his subscription before the date specified in the notice will have all of his funds promptly refunded with interest. Any person who elects to decrease his subscription will have the appropriate portion of his funds promptly refunded with interest.

THE APPRAISAL BY KELLER IS NOT INTENDED, AND MUST NOT BE CONSTRUED, AS A RECOMMENDATION OF ANY KIND AS TO THE ADVISABILITY OF PURCHASING COMMON SHARES OR VOTING TO APPROVE THE CONVERSION. IN PREPARING THE VALUATION, KELLER HAS RELIED UPON AND ASSUMED THE ACCURACY AND COMPLETENESS OF FINANCIAL AND STATISTICAL INFORMATION PROVIDED BY HOME CITY AND ITS INDEPENDENT AUDITORS. KELLER DID NOT INDEPENDENTLY VERIFY THE FINANCIAL STATEMENTS AND OTHER INFORMATION PROVIDED BY HOME CITY AND ITS INDEPENDENT AUDITORS, NOR DID KELLER VALUE INDEPENDENTLY THE ASSETS OR LIABILITIES OF HOME CITY OR HCFC. THE VALUATION CONSIDERS HOME CITY ONLY AS A GOING CONCERN AND SHOULD NOT BE CONSIDERED AS AN INDICATION OF THE LIQUIDATION VALUE OF HOME CITY. MOREOVER, BECAUSE SUCH VALUATION IS NECESSARILY BASED UPON ESTIMATES AND PROJECTIONS OF A NUMBER OF MATTERS, ALL OF WHICH ARE SUBJECT TO CHANGE FROM TIME TO TIME, NO ASSURANCE CAN BE GIVEN THAT PERSONS PURCHASING COMMON SHARES WILL THEREAFTER BE ABLE TO SELL SUCH SHARES AT PRICES WITHIN THE ESTIMATED PRICE RANGE.

A copy of the complete appraisal is on file and open for inspection at the offices of the OTS, 1700 G Street, N.W., Washington, D.C. 20552, at the Central Regional Office of the OTS, 200 West Madison, Suite 1300, Chicago, Illinois 60606, and at each of the offices of Home City.

15

RESTRICTION ON REPURCHASE OF COMMON SHARES

Federal regulations prohibit HCFC from repurchasing any of its capital stock for three years following the date of completion of the Conversion, except as part of an open-market stock repurchase program during the second and third years following the Conversion involving no more than 5% of HCFC's outstanding capital stock during a twelve-month period. In addition, after such a repurchase, Home City's regulatory capital must equal or exceed all regulatory capital requirements. Before commencement of such a program, HCFC must provide notice to the OTS, and the OTS may disapprove the program if the OTS determines that it would adversely affect the financial condition of Home City or if it determines that there is no valid business purpose for such repurchase. Such repurchase restrictions would not prohibit the ESOP or the RRP from purchasing Common Shares during the first year following Conversion.

RESTRICTIONS ON TRANSFERABILITY OF COMMON SHARES BY DIRECTORS AND OFFICERS

Common Shares purchased by directors or executive officers of HCFC or their Associates will be subject to the restriction that such shares may not be sold for a period of one year following completion of the Conversion, except in the event of the death of the shareholder. The certificates evidencing Common Shares issued by HCFC to directors, executive officers and their Associates will bear a legend giving appropriate notice of the restriction imposed upon the transfer of such Common Shares. In addition, HCFC will give appropriate instructions to the transfer agent (if any) for HCFC's Common Shares in respect of the applicable restriction for transfer of any restricted shares. Any shares issued as a stock dividend, stock split or otherwise in respect of restricted shares will be subject to the same restrictions.

Subject to certain exceptions, for a period of three years following the Conversion, no director or officer of HCFC or Home City, or any of their Associates, may purchase any common shares of HCFC without the prior written approval of the OTS, except through a broker-dealer registered with the SEC. This restriction will not apply, however, to negotiated transactions involving more than 1% of a class of outstanding common shares of HCFC or shares acquired by any stock benefit plan of Home City or HCFC.

The Common Shares, like the stock of most public companies, are subject to the registration requirements of the Securities Act. Accordingly, the Common Shares may be offered and sold only in compliance with such registration requirements or pursuant to an applicable exemption from registration. Common Shares received in the Conversion by persons who are not "affiliates" of HCFC may be resold without registration. Common Shares received by affiliates of HCFC will be subject to resale restrictions. An "affiliate" of HCFC, for purposes of Rule 144, is a person who directly, or indirectly through one or more intermediaries, controls, or is controlled by or is under common control with, HCFC. Rule 144 generally requires that there be publicly available certain information concerning HCFC and that sales subject to Rule 144 be made in routine brokerage transactions or through a market maker. If the conditions of Rule 144 are satisfied, each affiliate (or group of persons acting in concert with one or more affiliates) is entitled to sell in the public market, without registration, in any three-month period, a number of shares which does not exceed the greater of (i) 1% of the number of outstanding shares of HCFC or (ii) if the shares are admitted to trading on a national securities exchange or reported through the automated quotation system of a registered securities association, the average weekly reported volume of trading during the four weeks preceding the sale.

RIGHTS OF REVIEW

Any person aggrieved by a final action of the OTS which approves, with or without conditions, or disapproves the Plan may obtain review of such action by filing in the Court of Appeals of the United States for the circuit in which the principal office or residence of such person is located or in the United States Court of Appeals for the District of Columbia, a written petition praying that the final action of the OTS be modified, terminated or set aside. Such petition must be filed within 30 days after the date of mailing of proxy materials to the Voting Members of Home City or within 30 days after the date of publication in the Federal Register of notice of approval of the Plan by the OTS, whichever is later.

16

USE OF PROCEEDS

The following table presents the estimated gross and net proceeds from the sale of the Common Shares in connection with the Conversion based on the Valuation Range:

                                                                                                             Maximum,
                                       Minimum                Mid-point               Maximum              as adjusted
                                       -------                ---------               -------              -----------

Gross proceeds                       $6,120,000              $7,200,000             $8,280,000              $9,522,000
Less estimated expenses                 357,000                 372,000                387,000                 404,000
                                     ----------              ----------             ----------              ----------
Total net proceeds                   $5,763,000              $6,828,000             $7,893,000              $9,118,000
                                     ==========              ==========             ==========              ==========

The net proceeds from the sale of the Common Shares may be outside the Valuation Range, depending upon financial and market and regulatory conditions at the time of the completion of the Offering. See "THE CONVERSION - Pricing and Number of Common Shares to be Sold." The expenses are estimated assuming that (a) all of the indicated number of Common Shares are sold in the Subscription Offering; (b) the directors, officers and their Associates purchase 75,000 Common Shares and
(c) the ESOP purchases 8% of the Common Shares sold. Actual expenses may be more or less than estimated. See "THE CONVERSION - Plan of Distribution."

HCFC will retain 50% of the net proceeds from the sale of the Common Shares, or approximately $3,414,000 at the mid-point of the Valuation Range, including the value of a promissory note from the ESOP which HCFC intends to accept in exchange for the issuance of Common Shares to the ESOP. Such proceeds will be used to fund the RRP and will be invested in short-term and intermediate-term government securities. The remainder of the net proceeds received from the sale of the Common Shares, $3,414,000 at the mid-point of the Valuation Range, will be invested by HCFC in the capital stock to be issued by Home City to HCFC as a result of the Conversion. Such investment will increase the regulatory capital of Home City and will permit Home City to expand its lending and investment activities and to enhance customer services.

Home City anticipates that such net proceeds initially will be invested in short-term interest-bearing deposits in other financial institutions. Eventually, however, Home City will attempt to use the net proceeds to originate mortgage, consumer and other loans in Home City's market areas and may also use the proceeds from the Conversion to expand operations through the establishment of a branch office, which would include space for administrative operations. Home City estimates that the cost of establishing a new branch would be approximately $1.25 million, including land acquisition and construction costs. Although HCFC and Home City could use the increase in capital which will result from the Conversion to acquire other financial institutions or for HCFC to repurchase its own outstanding shares, HCFC and Home City have no current plans or agreements, written or oral, and are not negotiating, to acquire any other institution and have no current plans for HCFC to repurchase any of its shares. See "THE BUSINESS OF HOME CITY" in the Prospectus.

MARKET FOR COMMON SHARES

There is presently no market for the Common Shares. The aggregate offering price for the Common Shares is based upon an independent appraisal of Home City. The appraisal is not a recommendation as to the advisability of purchasing Common Shares. See "THE CONVERSION - Pricing and Number of Common Shares to be Sold." No assurance can be given that persons purchasing Common Shares will thereafter be able to sell such shares at a price at or above the offering price.

HCFC has received approval to have the Common Shares quoted on The Nasdaq Small Cap Market under the symbol "____" upon the closing of the Conversion, subject to certain conditions which HCFC and Home City believe will be satisfied, although no assurance can be provided that the conditions will be met. In connection with such approval, Webb has informed Home City that Keefe, Bruyette & Woods, Inc., intends to make a market in the Common Shares. No assurance can be given, however, that an active or liquid market for the Common Shares will develop after the completion of the Conversion or, if such a market does develop, that such market will continue. Investors should consider, therefore,

17

the potentially illiquid and long-term nature of an investment in the Common Shares. See "RISK FACTORS - Limited Market for the Common Shares" in the Prospectus.

DIVIDEND POLICY

The declaration and payment of dividends by HCFC will be subject to the discretion of the Board of Directors of HCFC and will be based on the earnings and financial condition of HCFC and general economic conditions. In an effort to manage the capital of HCFC, the Board of Directors may determine that the payment of a regular or special cash dividend or both may be prudent. No assurance can be given that any dividend will be declared or that any dividend, if declared, will continue in the future.

Other than earnings on the investment of the proceeds retained by HCFC, the only source of income of HCFC will be dividends periodically declared and paid by the Board of Directors of Home City on the common stock of Home City held by HCFC. The declaration and payment of dividends by Home City to HCFC will be subject to the discretion of the Board of Directors of Home City, to the earnings and financial condition of Home City, to general economic conditions and to federal restrictions on the payment of dividends by thrift institutions. Under regulations of the OTS applicable to converted associations, Home City will not be permitted to pay a cash dividend on its capital stock after the Conversion if its regulatory capital would, as a result of the payment of such dividend, be reduced below the amount required for the Liquidation Account or the applicable regulatory capital requirement prescribed by the OTS. See "THE CONVERSION Principal Effects of the Conversion -- Liquidation Account" and
"MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS OF HOME CITY - Liquidity and Capital Resources" in the Prospectus. Home City may not pay a dividend unless such dividend also complies with a regulation of the OTS limiting capital distributions by savings associations.

Capital distributions, for purposes of such regulation, include, without limitation, payments of cash dividends, repurchases and certain other acquisitions by an association of its shares and payments to stockholders of another association in an acquisition of such other association. The capital distribution regulation adopts a 3-tier classification of associations based upon their capital immediately before and, on a pro forma basis, after giving effect to the capital distribution. A tier 1 association is an association which has capital immediately before and after giving effect to a proposed capital distribution that is equal to or greater than the amount of its fully phased-in capital requirement. A tier 2 association is an association which has capital immediately before and after giving effect to a capital distribution which is equal to or in excess of its minimum capital requirement, but is less than the amount of its fully phased-in capital requirement. A tier 3 association is an association which fails to meet its minimum capital requirement immediately before or after giving effect to a capital distribution.

A tier 1 association may make capital distributions equal to up to the higher of (1) 100% of its net earnings to date during the calendar year in which the distribution is made, plus the amount that would reduce by one-half its "surplus capital ratio" at the beginning of the calendar year or (2) 75% of its net income over the most recent four-quarter period. The "surplus capital ratio" is the percentage by which an association's capital-to-assets ratio exceeds Home City's ratio of fully phased-in capital requirement to assets. A tier 2 association may make capital distributions up to 75% of its net earnings over the most recent four-quarter period, if Home City meets the current risk-based capital standard. A tier 3 association may make capital distributions only with the prior written approval of the Regional Director of the OTS or in accordance with an approved capital plan.

If an association meeting the tier 1 criteria has been notified by the OTS that Home City requires more than normal supervision, such association will be treated as a tier 2 or tier 3 association, unless the OTS determines that such treatment is not necessary to ensure Home City's safe and sound operation. Moreover, the OTS may prohibit any capital distribution otherwise permitted by the regulation if the OTS determines that such distribution would constitute an unsafe or unsound practice. See "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF HOME CITY - Liquidity and
Capital Resources" in the Prospectus.

At June 30, 1996, Home City met the fully phased-in capital requirement. Other than the earnings on the investment of proceeds retained by HCFC, the only source of income of HCFC will be dividends periodically declared and

18

paid by the Board of Directors of Home City on the common stock of Home City held by HCFC. The payment of dividends by Home City will be subject to various regulatory restrictions. On a pro forma basis, as of June 30, 1996, assuming (i) receipt by Home City of $3.4 million of net conversion proceeds, (ii) the investment of such net proceeds in assets having a risk weighting of 20% and
(iii) the establishment of a Liquidation Account in the amount of $5.4 million (the regulatory capital of Home City at June 30, 1996), Home City would have $4.19 million available for the payment of dividends to HCFC. See "REGULATORY CAPITAL COMPLIANCE" in the Prospectus.

DESCRIPTION OF AUTHORIZED SHARES

GENERAL

The Articles of Incorporation of HCFC authorize the issuance of five million common shares and one million preferred shares. The common shares and the preferred shares authorized by HCFC's Articles of Incorporation have no par value. Upon receipt by HCFC of the purchase price therefor and subsequent issuance thereof, each Common Share will be fully paid and nonassessable. The Common Shares of HCFC will represent nonwithdrawable capital and will not and cannot be insured by the FDIC. Each Common Share will have the same relative rights and will be identical in all respects to every other Common Share.

None of the preferred shares of HCFC will be issued in connection with the Conversion. The Board of Directors of HCFC is authorized, without shareholder approval, to issue preferred shares and to fix and state the designations, preferences or other special rights of such shares and the qualifications, limitations and restrictions thereof. The preferred shares may rank prior to the common shares as to dividend rights, liquidation preferences or both. Each holder of preferred shares will be entitled to one vote for each preferred share held of record on all matters submitted to a vote of shareholders. The issuance of preferred shares and any conversion rights which may be specified by the Board of Directors for the preferred shares could adversely affect the voting power of holders of the common shares. The Board of Directors has no present intention to issue any of the preferred shares.

The following is a summary description of the rights of the common shares of HCFC, including the material express terms of such shares as set forth in HCFC's Articles of Incorporation.

LIQUIDATION RIGHTS

In the event of the complete liquidation or dissolution of HCFC, the holders of the Common Shares will be entitled to receive all assets of HCFC available for distribution, in cash or in kind, after payment or provision for payment of (i) all debts and liabilities of HCFC, (ii) any accrued dividend claims, and (iii) any interests in the Liquidation Account.

VOTING RIGHTS

The holders of the Common Shares will possess exclusive voting rights in HCFC, unless preferred shares are issued. Each holder of Common Shares will be entitled to one vote for each share held of record on all matters submitted to a vote of holders of common shares.

Section 1701.55 of the Ohio Revised Code provides in substance and effect that shareholders of a for profit corporation which is not a savings and loan association and which is incorporated under Ohio law must initially be granted the right to cumulate votes in the election of directors. Section 1701.69 of the Ohio Revised Code provides that an Ohio corporation may eliminate cumulative voting in the election of directors after the expiration of 90 days after the date of initial incorporation by filing with the Ohio Secretary of State an amendment to the articles of incorporation eliminating cumulative voting. The Articles of Incorporation of HCFC have been amended to eliminate cumulative voting. See "RESTRICTIONS ON ACQUISITION OF HOME CITY AND HCFC AND
RELATED ANTI-TAKEOVER PROVISIONS Articles of Incorporation of HCFC -- Elimination of Cumulative Voting" in the Prospectus.

DIVIDENDS

19

The holders of the Common Shares will be entitled to the payment of dividends when, as and if declared by the Board of Directors and paid out of funds, if any, available under applicable laws and regulations for the payment of dividends. The payment of dividends is subject to federal and state statutory and regulatory restrictions. See "DIVIDEND POLICY" and "TAXATION - Federal Taxation" in the Prospectus for a description of restrictions on the payment of cash dividends.

PREEMPTIVE RIGHTS

After the consummation of the Conversion, no shareholder of HCFC will have, as a matter of right, the preemptive right to purchase or subscribe for shares of any class, now or hereafter authorized, or to purchase or subscribe for securities or other obligations convertible into or exchangeable for such shares or which by warrants or otherwise entitle the holders thereof to subscribe for or purchase any such share.

RESTRICTIONS ON ALIENABILITY

See "THE CONVERSION - Restrictions on Repurchase of Common Shares" for a description of the limitations on the repurchase of stock by HCFC; "THE CONVERSION - Restrictions on Transferability of Common Shares by Directors and Officers" for a description of certain restrictions on the transferability of Common Shares purchased by officers and directors; and "RESTRICTIONS ON ACQUISITION OF HOME CITY AND HCFC AND RELATED ANTI-TAKEOVER PROVISIONS" in the Prospectus for information regarding regulatory restrictions on acquiring Common Shares.

COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS

Each director of Home City receives a retainer fee of $1,000 per month for service as a director of Home City. In addition, the Chairman of the Board of Directors receives an additional fee of $150 per month. Edgar Witten, a Director Emeritus, receives a fee of $200 per month.

Four of Home City's directors participate in a deferred compensation plan whereby payment of part or all of such their directors' fees is deferred. Home City records the deferred fees as expenses and in a liability account. Interest is periodically credited on each account. Each director is fully vested in his account, and the balance is payable upon termination of directorship prior to death or retirement. Home City has provided for the contingent liability created by the deferred compensation plan by purchasing a single-premium universal life insurance policy on each director. Upon retirement or death, a director or his estate will receive the benefits payable pursuant to the policy on his life.

The following table presents certain information regarding the cash compensation received by the President and Chief Executive Officer of Home City. No other executive officer of Home City received compensation exceeding $100,000 during the fiscal year ended June 30, 1996.

SUMMARY COMPENSATION TABLE

-------------------------------------------------------------------------------------------------
                                                    Annual Compensation
                                              ---------------------------------
Name and Principal              Fiscal Year                                        All Other
Position                       ended June 30    Salary ($)(1)     Bonus ($)      Compensation(2)

-------------------------------------------------------------------------------------------------
Douglas L. Ulery                   1996           $100,000        $30,000            $3,338
  President and Chief
  Executive Officer
-------------------------------------------------------------------------------------------------


(1) Includes directors' fees of $12,000. Does not include amounts attributable to other miscellaneous benefits received by executive officers. The cost to Home City of providing such benefits to Mr. Ulery was less than 10% of his cash compensation.

20

(2) Consists of Home City's contribution to Mr. Ulery's 401(k) defined contribution plan account.

EXPERTS

The consolidated financial statements of Home City as of June 30, 1996 and 1995, and for the years ended June 30, 1996, 1995 and 1994, included in this Prospectus have been audited by Robb, Dixon, Francis, Davis, Oneson & Company, certified public accountants, as stated in their report appearing herein and have been so included in reliance upon such report given upon the authority of that firm as experts in accounting and auditing.

Keller has consented to the publication herein of the summary of its letter to Home City setting forth its opinion as to the estimated pro forma market value of Home City as converted and to the use of its name and statements with respect to it appearing herein.

LEGAL PROCEEDINGS

Home City is not presently involved in any material legal proceedings. From time to time, Home City is a party to legal proceedings incidental to its business to enforce its security interest in collateral pledged to secure loans made by Home City.

ADDITIONAL INFORMATION AND ORDER FORMS

The Prospectus contains the following: audited financial statements of Home City, including statements of income and retained earnings, for the three fiscal years ended June 30, 1996, 1995 and 1994; management's discussion and analysis of financial condition and results of operations of Home City; selected financial information of Home City for the five fiscal years ended June 30, 1996, 1995, 1994, 1993 and 1992; information concerning the capitalization of Home City; a description of Home City's lending, savings and investment activities; and additional information about the business and financial condition of Home City. A copy of the Prospectus accompanies this Summary Proxy Statement. To obtain an additional copy of the Prospectus, contact Home City's Conversion Information Center at (513) 324-5736.

The Subscription Offering will commence on November 20, 1996, and end at 4:00 p.m., Eastern Time, on December 13, 1996. Stock Order Forms for purchases of Common Shares in the Subscription Offering must be received by Home City on or before 4:00 p.m. Eastern Time, December 13, 1996.

21

EXHIBIT 99.2

STOCK ORDER FORM & HOME CITY FINANCIAL
CERTIFICATE FORM CORPORATION

Note: Please read the Stock Order Form Guide and Instructions on the back of this form before completion.

DEADLINE
The Subscription and Community Offering ends at 5:00 p.m., Springfield, Ohio time XXXX xx, 1996. Your Stock Order Form and Certification Form, properly executed and with the correct payment, must be received at the address on the bottom of this form by this deadline, or it will be considered void.

NUMBER OF SHARES

     (1) Number of Shares           Price Per Share        (2) Total Amount Due
 ---------------------------                              ----------------------
|                           |   x        $10.00     =    |                     |
 ---------------------------                              ----------------------

THE MINIMUM NUMBER OF SHARES THAT A PERSON MAY SUBSCRIBE FOR IS 25 and the maximum purchase is 1% of the total number of shares sold in the Offering (up to xx,xxx shares, based on anticipated sales of xxx,xxx shares). No person, together with his Associates and other persons acting in concert with him, may purchase in the Community Offering more than 1% of the total shares sold in the Offering and no person, together with his associates and other persons acting in concert with him, may purchase in the Subscription Offering more than 2% of the total Common Shares sold in the offering (up to xx,xxx shares, based on anticipated sales of xxx,xxx shares).

METHOD OF PAYMENT | PURCHASER INFORMATION
(3) / / Enclosed is a check, bank draft | (5) / / Check here if you are a

        or money order payable to Home  |         director, officer or employee
        City Financial Corporation for  |         of Home City Federal Savings
        $_____________ (or cash if      |         Bank of Springfield or a
        presented in person).           |         member of such person's
                                        |         immediate family.
(4) / / I authorize Home City Federal   |     / / Check here if you are a
        Savings Bank of Springfield to  |         depositor or a borrower and
        make withdrawals from my Home   |         enter below information for
        City Federal Savings Bank of    |         all accounts you had at the
        Springfield account(s) shown    |         Eligibility Record Date
        below, and understand that the  |         (June 30, 1995), Supplemental
        amounts will not otherwise be   |         Eligibility Record Date
        available for withdrawal        |         (September 30, 1996) or the
        (there is no penalty for an     |         Voting Record Date (XXXX,
        early CD withdrawal):           |         1996). If additional space is
                                        |         needed, please utilize the
ACCOUNT NUMBER(S)      |    AMOUNTS     |         back of this form. Please
                       |                |         confirm account(s) by
- ---------------------- | -------------  |         initialing here. _____________
                       |                |
- ---------------------- | -------------  |  ACCOUNT TITLE      | ACCOUNT NUMBER
                       |                |  (Names on Accounts)|
- ---------------------- | -------------  |                     |
                       |                |                     |
- ---------------------- | -------------  |  ------------------ | ----------------
                       |                |                     |
      TOTAL WITHDRAWAL | -------------  |  ------------------ | ----------------
- --------------------------------------------------------------------------------
(6) STOCK REGISTRATION
      / / Individual     / / Uniform Transfer to Minors  / / Partnership
      / / Joint Tenants  / / Uniform Gift to Minors      / / Individual
                                                              Retirement Account
      / / Tenants in     / / Corporation                 / / Fiduciary/Trust
           Common                                             (Under Agreement
                                                              Dated____________)
- --------------------------------------------------------------------------------
Name                                    | Social Security or Tax I.D.
                                        |
- --------------------------------------------------------------------------------
Name                                    | Daytime Telephone
                                        |
- --------------------------------------------------------------------------------
Street Address                          | Evening Telephone
                                        |
- -------------------------------------------------------------------------------
City                State        Zip    | County of Residence
                                        |
- -------------------------------------------------------------------------------

NASD AFFILIATION (This section only applies to those individuals who meet the delineated criteria)

/ / Check here if you are a member of the National Association of Securities Dealers, Inc. ("NASD"), a person associated with an NASD member, a member of the immediate family of any such person to whose support such person contributes, directly or indirectly, or the holder of an account in which an NASD member or person associated with an NASD member has a beneficial interest. To comply with conditions under which an exemption from the NASD's Interpretation With Respect to Free-Riding and Withholding is available, you agree, if you have checked the NASD affiliation box: (1) not to sell, transfer or hypothecate the stock for a period of 90 days following the issuance, and (2) to report this subscription in writing to the applicable NASD member within one day of the payment therefor.
ACKNOWLEDGMENT By signing below, I acknowledge receipt of the Prospectus dated XXXX xx, 1996, and understand I may not change or revoke my order once it is received by Home City Financial Corporation. I also certify that this stock order is for my account and there is no agreement or understanding regarding any further sale or transfer of these shares. Federal regulations prohibit any persons from transferring, or entering into any agreement directly or indirectly to transfer, the legal or beneficial ownership of conversion subscription rights or the underlying securities to the account of another person. Home City Financial Corporation will pursue any and all legal and equitable remedies in the event it becomes aware of the transfer of subscription rights and will not honor orders known by it to involve such transfer. Under penalties of perjury, I further certify that: (1) the social security number or taxpayer identification number given above is correct; and (2) I am not subject to backup withholding. You must cross out his item, (2) above, if you have been notified by the Internal Revenue Service that you are subject to backup withholding because of underreporting interest or dividends on your tax return. BY SIGNING BELOW, I ALSO ACKNOWLEDGE THAT I HAVE NOT WAIVED ANY RIGHTS UNDER THE SECURITIES ACT OF 1933, AND THE SECURITIES EXCHANGE ACT OF 1934.

SIGNATURE Sign and date this form. When purchasing as a custodian, corporate officer, etc., include your full title. An additional signature is required only if payment is by withdrawal from an account that requires more than one signature to withdraw funds. YOUR ORDER WILL BE FILLED IN ACCORDANCE WITH THE PROVISIONS OF THE PROSPECTUS. THIS ORDER IS NOT VALID IF THE STOCK ORDER FORM AND CERTIFICATION FORM ARE NOT BOTH SIGNED. If you need help completing this Form, you may call the Conversion Information Center at (513) 324-3830.

THE COMMON SHARES OFFERED HEREBY ARE NOT SAVINGS ACCOUNTS AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE SAVINGS ASSOCIATION INSURANCE FUND OR ANY OTHER GOVERNMENTAL AGENCY.

  | Signature                Title (if applicable)            Date       |
  |                                                                      |
   ----------------------------------------------------------------------
  | Signature                Title (if applicable)            Date       |
  |                                                                      |
   ----------------------------------------------------------------------
- ------------------------------------------------------------------------------
 ----------------------------------------------  CONVERSION INFORMATION CENTER
|                  OFFICE USE                  |      63 West Main Street
|                                              |       Springfield, Ohio
| Date Rec'd__/__/__ Order#________ Batch#____ |        (513) 324-3830
| Check#____________ Category______            |
| Amount $__________ Initials______            |
 ----------------------------------------------


HOME CITY FINANCIAL CORPORATION

STOCK OWNERSHIP GUIDE

Instructions: See your legal advisor if you are unsure about the correct registration of your shares.

INDIVIDUAL - The shares are to be registered in an individual's name only. You may not list beneficiaries for this ownership.

JOINT TENANTS - Joint tenants with right of survivorship identifies two or more owners. When shares are held by joint tenants with rights of survivorship, ownership automatically passes to the surviving joint tenant(s) upon the death of any joint tenant. You may not list beneficiaries for this ownership.

TENANTS IN COMMON - Tenants in common may also identify two or more owners. When shares are to be held by tenants in common, upon the death of one co-tenant, ownership of the shares will be held by the surviving co-tenant(s) and by the heirs of the deceased co-tenant. All parties must agree to the transfer or sale of shares held by tenants in common. You may not list beneficiaries for this ownership.

INDIVIDUAL RETIREMENT ACCOUNT - Individual Retirement Account ("IRA") holders may make purchases from their deposits through a pre-arranged "trustee-to-trustee" transfer. Shares may only be held in a self-directed IRA. Home City Federal Savings Bank of Springfield does not offer a self-directed IRA. Please contact the Conversion Information Center if you have any questions about your IRA account or to obtain a list of local brokers who will open a self-directed IRA, or check with your broker. There will be no early withdrawal or IRS penalties incurred by these transactions.

UNIFORM GIFT TO MINORS - For residents of many states, shares may be held in the name of a custodian for the benefit of a minor under the Uniform Transfer to Minors Act. For residents in other states, shares may be held in a similar type of ownership under the Uniform Gift to Minors Act of the Individual states. For either ownership, the minor is the actual owner of the shares with the adult custodian being responsible for the investment until the child reaches legal age.

On the first line, print the first name, middle initial and last name of the custodian, with the abbreviation "CUST" and "Unif Tran Min Act" or "Unif Gift Min Act" after the name. Standard U.S. Postal Service state abbreviation should be used to describe the appropriate state. For example, shares held by John Doe as custodian for Susan Doe under the Ohio Uniform Transfer to Minors Act will be abbreviated John Doe, CUST Susan Doe Unif Tran Min Act, OH. Use the minor's Social Security Number. Print the first name, middle initial and last name of the minor on the second "NAME" line. Only one custodian and one minor may be designated.

CORPORATION/PARTNERSHIP - Corporations/Partnerships may purchase shares. Please provide the Corporation/Partnership's legal name and Tax I.D. To have depositor rights the Corporation/Partnership must have an account in the legal name. Please contact the Conversion Information Center to verify depositor rights and purchase limitations.

FIDUCIARY/TRUST - Generally, fiduciary relationships (such as Trusts, Estates, Guardianships, etc.) are established under a form of trust agreement or are pursuant to a court order. Without a legal document establishing a fiduciary relationship, your shares may not be registered in a fiduciary capacity.

Instructions: On the first "NAME" line, print the first name, middle initial and last name of the fiduciary if the fiduciary is an individual. If the fiduciary is a corporation, list the corporate title on the first "NAME" line. Following the name, print the fiduciary "title" such as trustee, executor, personal representative, etc.

On the second "NAME" line, print either the name of the maker, donor or testator OR the name of the beneficiary. Following the name, indicate the type of legal document establishing the fiduciary relationship (agreement, court order, etc.). In the blank after "Under Agreement Dated", fill in the date of the document governing the relationship. The date of the document need not be provided for a trust created by a will.

An example of fiduciary ownership of shares in the case of a trust is: John D. Smith, Trustee for Thomas A. Smith Under Agreement Dated 06/09/87.

DEFINITION OF ASSOCIATE

The term "associate" of a person defined to mean (a) any corporation or other organization (other than Home City) of which such person is an officer, partner, or directly or indirectly, the beneficial owner of 10% or more of any class of equity securities; (b) any trust or other estate in which such person has a substantial beneficial interest or as to which such person serves as trustee or in a similar fiduciary capacity, and (c) any relative or spouse of such person, or any relative of such spouse, who either has the same home as such person or who is a director or officer of Home City.


CERTIFICATION FORM
(This Form Must Accompany A Signed Stock Order Form)

I ACKNOWLEDGE THAT THE COMMON SHARES, NO PAR VALUE PER SHARE ("COMMON SHARES"), OF HOME CITY FINANCIAL CORPORATION ("HOME CITY") ARE NOT FEDERALLY INSURED AND ARE NOT GUARANTEED BY HOME CITY OR THE FEDERAL GOVERNMENT.

If anyone asserts that the Common Shares are federally insured or guaranteed, or are as safe as an insured deposit, I should call the Office of Thrift Supervision Central Regional Director, Ronald N. Karr, at (312) 917-5000.

I further certify that, before purchasing the Common Shares of Home City, I received a copy of the Prospectus dated, XXXXX xx, 1996 which discloses the nature of the Common Shares being offered thereby and describes the following risks involved in an investment in the Common Shares under the heading "Risk Factors" beginning on page X of the Prospectus:

1. Interest Rate Risk

2. Limited Market for the Common Shares

3. Possible Inadequacy of the Allowance for Loan Losses

4. Legislation and Regulation Which May Adversely Affect Home City's Earnings

5. Controlling Influence of Management and Anti-Takeover Provisions Which May Discourage Sales of Common Shares for Premium Prices

6. Possible Adverse Effects if Preferred Shares Are Issued

7. Risk of Delayed Offering

8. Dilutive Effect of Increase in Valuation Range

9. Dilutive Effect of Purchases by the ESOP and the RRP

 __________________________________         __________________________________
| Signature                        |       | Signature                        |
|                                  |       |                                  |

|__________________________________| |__________________________________|

(Note: If shares are to be held jointly, both parties must sign)

Date: ____________________________


HOME CITY FINANCIAL
CORPORATION

ITEM INSTRUCTION

ITEMS 1 AND 2 -
Fill in the number of shares that you wish to purchase and the total payment due. The amount due is determined by multiplying the number of shares by the subscription price of $10.00 per share. The minimum purchase is 25 shares. The maximum purchase by any person is 1% of the total number of shares sold in the Offering (up to xx,xxx shares, based on anticipated sales of xxx,xxx). No person, together with associates of and persons acting in concert with such person, may purchase in the Subscription Offering more than 2% of the total number of shares in the Offering (up to xx,xxx shares, based on anticipated sales of xxx,xxx) and no person, together with Associates of and persons acting in concert with such person, may purchase in the Community Offering more than 1% of the total number of shares sold in the Offering (up to xx,xxx shares, based on anticipated sales of xxx,xxx).

The Home City Federal Savings Bank of Springfield has reserved the right to reject the subscription of any order received in the Community Offering, in whole or in part.

ITEM 3 - Payment for shares may be made in cash (only if delivered by you in
person) or by check, bank draft or money order made payable to Home City Financial Corporation. DO NOT MAIL CASH. If you choose to make a cash payment, take your Stock Order Form, signed Certification Form and payment in person to Home City Federal Savings Bank of Springfield. Your funds will earn interest at Home City Federal Savings Bank of Springfield's passbook rate, currently 2.50% per annum.

ITEM 4 - To pay by withdrawal from a savings account or certificate at Home City
Federal Savings Bank of Springfield, insert the account number(s) and the Amount(s) you wish to withdraw from each account. If more than one signature is required to withdraw, each must sign in the Signature box on the front of this form. To withdraw from an account with checking privileges, please write a check. No early withdrawal penalty will be charged on funds used to purchase shares. A hold will be placed on the account(s) for the amount(s) you show. Payments will remain in certificate account(s) until the offering closes. However, if a partial withdrawal reduces the balance of a certificate account to less than the applicable minimum, the remaining balance will thereafter earn interest in the passbook rate.

ITEM 5 - Please check this box if you were a depositor on the Eligibility Record
Date (June 30, 1995), and/or a depositor on the Supplemental Eligibility Record Date (September 30, 1996) or a depositor or borrower on the Voting Record Date
(XXXX XX, 1996) and list all names on the account(s) and all account number(s)
of those accounts you had at these dates to ensure proper identification of your purchase rights.

ITEMS 6 and 7 - The stock transfer industry has developed a uniform system of shareholder registrations that we will use in the issuance of Home City Financial Corporation common shares. Print the name(s) in which you want the shares registered and the mailing address of the registration. Include the first name, middle initial and last name of the shareholder. Avoid the use of two initials. Please omit words that do not affect ownership rights, such as "Mrs.", "Mr.", "Dr.", "special account", etc.

Subscription rights are not transferable. If you are a qualified member, to protect your priority over other purchasers as described in the Prospectus, you must take ownership in at least one of the account holder's name.

Enter the Social Security or Tax I.D. number of one registered owner. This registered owner must be listed on the first "NAME" line. Be sure to include your telephone number because we will need to contact you if we cannot execute your order as given. Review the Stock Ownership Guide on this page and refer to the instructions for Uniform Gift to Minors/Uniform Transfer to Minors and Fiduciaries.

Account Title (Names on Account(s) Account Number

| | | | ------------------------------------ | | | _____________________________________|____________________________ | | | | | ------------------------------------ | | | _____________________________________|____________________________ | | | | | ------------------------------------ | | | _____________________________________|____________________________ | | | | | ------------------------------------ | | | _____________________________________|____________________________ |

Exhibit 99.6

CONVERSION VALUATION APPRAISAL REPORT

Prepared For:

HOME CITY FEDERAL SAVINGS BANK

and

HOME CITY FINANCIAL CORPORATION

Springfield, Ohio

As Of:
September 6, 1996

Prepared By:

KELLER & COMPANY, INC.
555 Metro Place North
Suite 524
Dublin, Ohio 43017
(614) 766-1426

KELLER & COMPANY


CONVERSION VALUATION APPRAISAL REPORT

Prepared for:

HOME CITY FINANCIAL CORPORATION

and

HOME CITY FEDERAL SAVINGS BANK

Springfield, Ohio

As Of:
September 6, 1996

Prepared By:

Michael R. Keller
President


[KELLER & COMPANY, INC. LETTERHEAD]

September 23, 1996

Board of Directors
Home City Federal Savings Bank
63 West Main Street
Springfield, OH 45502

Gentlemen:

We hereby submit an independent appraisal of the pro forma market value of the to-be-issued stock of Home City Financial Corporation (the "Corporation"), which is the newly formed holding company of Home City Federal Savings Bank, Springfield, Ohio ("Home City Federal" or the "Bank"). The Corporation will hold all of the shares of the common stock of the bank. Such stock is to be issued is connection with the Bank's conversion from a federally chartered mutual savings bank to a federally chartered stock savings bank in accordance with the Bank's Plan of Conversion. The appraisal was prepared and provided to the bank in accordance with the conversion requirements and regulations of the Office of Thrift Supervision if the United States Department of the Treasury.

Keller & Company, Inc. is an independent financial institution consulting firm that serves both banks and thrift institutions. the firm is a full-service consulting organization, as described in more detail in Exhibit A, specializing in market studies, business and strategic plans, stock valuations, conversions appraisals, and fairness opinions for thrift institutions and banks. the firm ha affirmed its independence in this transaction with the preparation of its Affidavit of Independence, a copy of which is included as Exhibit C.

Our appraisal is based on the assumption that the data provided to us by Home City Federal and the material provided by the independent auditor, Robb, Dixon, Francis, Oneson, & Company, Granville, Ohio, are both accurate and complete. We did not proceed to verify the financial statements provided to us , nor did we conduct independent valuations of the Bank's assets and liabilities. We have also used information from other public sources, but we cannot assure the accuracy of such material.


Board of Directors
Home City Federal Savings Bank
September 23, 1996

Page 2

In the completion of this appraisal, we held discussions with the management of Home City Federal, with the law firm of Vorys, Seymour & Pease, Cincinnati, Ohio, the Bank's conversion counsel, and with Robb, Dixon, Francis, Oneson & Company. Further, we viewed the Bank's local economy and primary market area.

This valuation must not be considered as a recommendation as to the purchase of stock in the Corporation, and we can provide no guarantee or assurance that any person who purchases shares of the Corporation's stock in this conversion will be able to later sell such shares at a price equivalent to the price designated in this appraisal.

Our valuation will be updated as required and will give consideration to any new developments in the Bank's operation that have an impact on operations or financial condition. Further, we will give consideration to any changes in general market conditions and to specific changes in the market for publicly-traded thrift institutions. Based on the material impact of any such changes on the pro forma market value of the Bank as determined by this firm, we will proceed to make necessary adjustments to the Bank's appraised value in such appraisal update.

It is our opinion that as of September 6, 1996, the pro forma market value or appraised value of the Corporation is $7,200,000. Further, a range for this valuation is from a minimum of $6,120,000 to a maximum of $8,280,000, with a super-maximum of $9,522,000.

Very truly yours,

KELLER & COMPANY, INC.

/s/ Michael R. Keller
Michael R. Keller
President


TABLE OF CONTENTS

                                                                         PAGE

INTRODUCTION                                                                1

  I.     Description of Home City Federal Savings Bank
         General                                                            4
         Performance Overview                                               9
         Income and Expense                                                11
         Yields and Costs                                                  16
         Interest Rate Sensitivity                                         17
         Lending Activities                                                19
         Non-Performing Assets                                             23
         Investments                                                       25
         Deposit Activities                                                26
         Borrowings                                                        26
         Subsidiaries                                                      27
         Office Properties                                                 27
         Management                                                        27

II.      Description of Primary Market Area                                28

III.     Comparable Group Selection
         Introduction                                                      34
         General Parameters
           Merger/Acquisition                                              35
           Mutual Holding Companies                                        36
           Trading Exchange                                                36
           IPO Date                                                        37
           Geographic Location                                             37
           Asset Size                                                      38
         Balance Sheet Parameters
           Introduction                                                    39
           Cash and Investments to Assets                                  39
           Mortgage-Backed Securities to Assets                            40
           One- to Four-Family Loans to Assets                             40
           Total Net Loans to Assets                                       41
           Total Net Loans and Mortgage-Backed Securities to Assets        41
           Borrowed Funds to Assets                                        41
           Equity to Assets                                                42
         Performance Parameters
           Introduction                                                    43


                            TABLE OF CONTENTS (CONT.)

                                                                     PAGE

III.     Comparable Group Selection (cont.)
         Performance Parameters (cont.)
           Return on Average Assets                                     43
           Return on Average Equity                                     44
           Net Interest Margin                                          44
           Operating Expenses to Assets                                 45
           Noninterest Income to Assets                                 45
         Asset Quality Parameters
           Introduction                                                 46
           Nonperforming Assets to Asset Ratio                          46
           Repossessed Assets to Assets                                 46
           Loans Loss Reserves to Assets                                47
         The Comparable Group                                           47
         Summary of Comparable Group Institutions                       49

IV.      Analysis of Financial Performance                              51

V.       Market Value Adjustments
         Earnings Performance                                           54
         Market Area                                                    54
         Financial Condition                                            58
         Dividend Payments                                              60
         Subscription Interest                                          60
         Liquidity of Stock                                             61
         Management                                                     61
         Marketing of the Issue                                         62

VI.      Valuation Methods                                              64
         Price to Book Value Ratio Method                               65
         Price to Earnings Method                                       66
         Price to Net Assets Method                                     67
         Valuation Conclusion                                           69


LIST OF EXHIBITS

NUMERICAL                                                               PAGE
EXHIBITS

   1              Balance Sheet - June 30, 1996                            70
   2              Balance Sheet - June 30, 1992 through 1995               71
   3              Income Statement - Year Ended June 30, 1996              72
   4              Income Statement - June 30, 1992 through 1995            73
   5              Selected Consolidated Financial Data                     74
   6              Income and Expense Trends                                75
   7              Normalized Earnings Trend                                76
   8              Performance Indicators                                   77
   9              Volume/Rate Analysis                                     78
  10              Yield and Cost Trends                                    79
  11              Interest Rate Sensitivity of Net Portfolio Value         80
  12              Loan Portfolio Composition                               81
  13              Loan Maturity Schedule                                   82
  14              Loan Portfolio Originations                              83
  15              Delinquent Loans                                         84
  16              Nonperforming Assets                                     85
  17              Classified Assets                                        86
  18              Allowance for Loan Losses                                87
  19              Investment Portfolio Composition                         88
  20              Mix of Deposits                                          89
  21              Deposit Activity                                         90
  22              Borrowed Funds                                           91
  23              List of Key Officers and Directors                       92
  24              Key Demographic Data and Trends                          93
  25              Key Housing Data                                         94
  26              Major Sources of Employment                              95
  27              New Housing Permits and Growth Rates                     96
  28              Unemployment Rates                                       97
  29              Market Share of Deposits                                 98
  30              National Interest Rates by Quarter                       99
  31              Thrift Stock Prices and Pricing Ratios                  100
  32              Key Financial Data and Ratios                           111
  33              Recently Converted Thrift Institutions                  123
  34              Acquisitions and Pending Acquisitions                   125
  35              Thrift Stock Prices and Pricing Ratios -
                    Mutual Holding Companies                              126


LIST OF EXHIBITS (CONT.)

NUMERICAL                                                                 PAGE
EXHIBITS



  36             Key Financial Data and Ratios -
                   Mutual Holding Companies                                 127
  37             Balance Sheets Parameters -
                   Comparable Group Selection                               128
  38             Operating Performance and Asset Quality Parameters -
                   Comparable Group Selection                               131
  39             Balance Sheet Ratios -
                   Final Comparable Group                                   134
  40             Operation Performance and Asset Quality Ratios
                          Final Comparable Group                            135
  41             Balance Sheet Totals - Final Comparable Group              136
  42             Market Area Comparison - Final Comparable Group            137
  43             Balance Sheet - Asset Composition
                          Most Recent Quarter                               138
  44             Balance Sheet - Liability and Equity
                          Most Recent Quarter                               139
  45             Income and Expense Comparison
                          Trailing Four Quarters                            140
  46             Income and Expense Comparison as a Percent of
                          Average Assets - Trailing Four Quarters           141
  47             Yields, Costs & Earnings Ratios
                          Trailing Four Quarters                            142
  48             Dividends, Reserves and Supplemental Data                  143
  49             Market Pricings and Financial Ratios - Stock Prices
                          Comparable Group                                  144
  50             Valuation Analysis and Conclusions                         145
  51             Pro Forma Minimum Valuation                                146
  52             Pro Forma Mid-Point Valuation                              147
  53             Pro Forma Maximum Valuation                                148
  54             Pro Forma Superrange Valuation                             149
  55             Summary of Valuation Premium or Discount                   150


ALPHABETICAL EXHIBITS
      PAGE

   A                Background and Qualifications                       151
   B                RB 20 Certification                                 155
   C                Affidavit of Independence                           156


INTRODUCTION

Keller & Company, Inc., an independent appraisal firm for financial institutions, has prepared this Conversion Appraisal Report ("Report") which provides the pro forma market value of the to-be-issued common stock of Home City Financial Corporation (the "Corporation"), an Ohio corporation, formed as a holding company to own all of the to-be-issued shares of common stock of Home City Federal Savings Bank, ("Home City Federal" or the "Bank"). The stock is to be issued in connection with the Bank's Application for Approval of Conversion from a federally chartered mutual savings Bank to a federally chartered stock savings bank. The Application is being filed with the Office of Thrift Supervision ("OTS") of the Department of the Treasury and the Securities and Exchange Commission ("SEC"). In accordance with the Bank's conversion, there will be a simultaneous issuance of all the Bank's stock to the Corporation, which will be formed by the Bank. Such Application for Conversion has been reviewed by us, including the Prospectus and related documents, and discussed with the Bank's management and the Bank's conversion counsel, Vorys, Sater, Seymour & Pease, Cincinnati, Ohio.

This conversion appraisal was prepared based on the guidelines provided by OTS entitled "Guidelines for Appraisal Reports for the Valuation of Savings Institutions Converting from the Mutual to Stock Form of Organization", in accordance with the OTS application requirements of Regulation ss.563b and the OTS's Revised Guidelines for Appraisal Reports, and represents a full appraisal report. The Report provides detailed exhibits based on the Revised Guidelines and a discussion on each of the fourteen factors that need to be considered. Our valuation will be updated in accordance with the Revised Guidelines and will consider any changes in market conditions for thrift institutions.

The pro forma market value is defined as the price at which the stock of the Corporation after conversion would change hands between a typical willing buyer and a

1

INTRODUCTION (CONT.)

typical willing seller when the former is not under any compulsion to buy and the latter is not under any compulsion to sell, and with both parties having reasonable knowledge of relevant facts in an arms-length transaction. The appraisal assumes the Bank is a going concern and that the shares issued by the Corporation in the conversion are sold in non-control blocks.

In preparing this conversion appraisal, we have reviewed the audited financial statements for the five fiscal years ended June 30, 1992 through 1996, and discussed them with Home City Federal's management and with Home City Federal's independent auditors, Robb, Dixon, Francis Davis, Oneson & Company, Granville, Ohio. We have also discussed and reviewed with management other financial matters. We have reviewed the Corporation's preliminary Form S-1 and the Bank's preliminary Form AC and discussed them with management and with the Bank's conversion counsel.

We have visited Home City Federal's home office and have traveled the surrounding area. We have studied the economic and demographic characteristics of the Bank's primary market area relative to Ohio and the United States. We have also examined the competitive financial institution environment within which Home City Federal operates, giving consideration to the area's key characteristics, both positive and negative.

We have given consideration to the market conditions for securities in general and for publicly-traded thrift stocks in particular. We have examined the performance of selected publicly-traded thrift institutions and compared the performance of Home City Federal to those selected institutions.

2

INTRODUCTION (CONT.)

Our valuation is not intended to represent and must not be interpreted to be a recommendation of any kind as to the desirability of purchasing the to-be-outstanding shares of common stock of the Corporation. Giving consideration to the fact that this appraisal is based on numerous factors that can change over time, we can provide no assurance that any person who purchases the stock of the Corporation in this mutual-to-stock conversion will subsequently be able to sell such shares at prices similar to the pro forma market value of the Corporation as determined in this conversion appraisal.

3

I. DESCRIPTION OF HOME CITY FEDERAL SAVINGS BANK

GENERAL

Home City Federal Savings Bank, Springfield, Ohio, was organized in 1925 as an Ohio savings and loan Association with the name of Home City Savings and Loan Association. The Bank later converted to a mutual federal savings and loan Association and then converted to a federal savings bank in May, 1996, changing its name to Home City Federal Savings Bank.

Home City Federal conducts its business from its home office in Springfield, Ohio, and has no branch offices. The Bank's primary market area consists of Clark County with Springfield being the county seat and largest community in the county. Home City Federal's deposits are insured up to applicable limits by the Federal Deposit Insurance Corporation ("FDIC") in the Savings Association Insurance Fund ("SAIF"). The Bank is also subject to certain reserve requirements of the Board of Governors of the Federal Reserve Bank (the "FRB"). Home City Federal is a member of the Federal Home Loan Bank (the "FHLB") of Cincinnati and is regulated by the OTS, and by the FDIC. As of June 30, 1996, Home City Federal had assets of $55,728,000, deposits of $47,174,000 and equity of $5,398,000.

In the past five years, legislation has had an impact on the operations in the financial institution industry. In 1989, the Financial Institution Reform, Recovery, and Enforcement Act ("FIRREA") became effective and put into place more stringent supervisory standards and higher capital requirements for the thrift industry. FIRREA established new capital requirements and strengthened OTS' enforcement powers. These capital requirements continue today under the FDIC and the FRB and include a tier one capital requirement of 4.0 percent of total assets, and a risk-based capital requirement of 8.0 percent of risk-weighted assets. OTS now has the power to assess civil money penalties and issue cease and desist orders for violations of regulations deemed unsafe and unsound practices.

4

GENERAL (CONT.)

FIRREA also resulted in an increase in deposit insurance premiums which thrifts must pay to the FDIC. A plan for a one-time premium of 0.65 percent to 0.75 percent of deposits or possibly less to capitalize the SAIF does exist, and such an increase would have an adverse effect on Home City Federal's equity and net income. Further, there has been a recent significant decrease in premiums on Bank Insurance Fund ("BIF") deposits, which has an adverse competitive impact on Home City Federal and could affect its ability to compete effectively with BIF-insured banks for deposits. Such impact could result in a downward impact on prices of publicly traded thrift institutions.

FIRREA's objective was strengthened when the Federal Deposit Insurance Corporation Improvement Act ("FDICIA") was passed, resulting in additional provisions relating to thrift institutions. FDICIA provided for the recapitalization of the insurance fund. FDICIA requires federally-insured financial institutions to be examined at least annually and submit independently audited financial reports based on the size of the institution. Home City Federal meets the standards for a well capitalized institution.

Home City Federal is a community-oriented institution which has been principally engaged in the business of serving the financial needs of the public in Springfield City and throughout its market area. Home City Federal has been actively and consistently involved in the origination of residential mortgage loans for the purchase of one- to four-family dwellings, comprising 76.1 percent of its loan originations during the year ended June 30, 1996, and 66.2 percent of its loan originations during the fiscal year ended June 30, 1995. At June 30, 1996, 64.9 percent of its gross loans consisted of residential real estate loans on one- to four-family dwellings, not including residential construction loans of 4.8 percent compared to a lower 57.6 percent at June 30, 1994, with the primary source of its funds being retail deposits from residents in its local communities. The Bank is also an originator of multifamily loans, nonresidential real estate loans, construction loans and also offers consumer loans on a less active basis. Consumer loans include automobile

5

GENERAL (CONT.)

loans, secured and unsecured personal loans and loans on savings accounts. Nonresidential real estate and land loans represented a strong 19.5 percent share of the Bank's total loans at June 30, 1996 and multifamily loans represented 6.6 percent.

The Bank had $5.4 million, or 9.7 percent of its assets in cash and investments including FHLB stock. The Bank had an additional $3.0 million, or 5.4 percent of its assets, in mortgage-backed securities, with the combined total of investment securities, mortgage-backed securities and cash and cash equivalents being $8.4 million or 15.1 percent of assets. Deposits and retained earnings have been the primary sources of funds for the Bank's lending and investment activities with FHLB advances having also served as an additional source of funds.

The management of Home City Federal is aware of the emphasis being placed on matching the maturities of assets and liabilities and monitoring the Bank's interest rate sensitivity position and market value of portfolio equity. The Bank understands the nature of interest rate risk and the potential earnings impact during times of rapidly changing rates, either rising or falling. Home City Federal also recognizes the need and importance of attaining a competitive net interest margin due to its more moderate levels of fee and other income.

The Bank's gross amount of stock to be sold in the conversion will be $7,200,000 or 720,000 shares at $10 per share based on the midpoint of the appraised value, with net conversion proceeds of $6,828,000 reflecting conversion expenses of $372,000. The actual cash proceeds to the Bank of $3.4 million will represent fifty percent of the net conversion proceeds, including the ESOP of $576,000, and will be invested in mortgage loans, construction loans, and consumer loans over time, and initially invested in short term investments. A portion of the Bank's conversion proceeds, approximately $1.5 million will be invested in the Bank's planned new home office to begin construction in

6

GENERAL (CONT.)

1997. The Bank may also use the proceeds to expand services, expand operations or other financial service organizations, diversification into other businesses, or for any other purposes authorized by law. The Holding Company will use its proceeds to fund the ESOP and to invest in short- and intermediate-term government securities.

Home City Federal has seen strong overall deposit growth over the past five fiscal years with deposits increasing a moderate 19.7 percent from June 30, 1992, to June 30, 1996, or an average of 4.9 percent per year. The Bank anticipates consistent growth in the future. The Bank has focused on increasing its residential and nonresidential real estate loan portfolio during the past five years, decreasing its level of cash and investments, increasing its mortgage-backed securities, reducing nonperforming assets, monitoring its earnings and increasing its capital to assets ratio. Equity to assets increased from 6.69 percent of assets at June 30, 1992, to 9.75 percent at June 30, 1996.

Home City Federal's primary lending strategy has been to originate and retain both adjustable-rate and fixed-rate residential mortgage loans with emphasis on fixed-rate mortgage loans with a higher level of nonresidential real estate loans.

Home City Federal's share of one- to four-family mortgage loans has risen moderately, increasing from 57.6 percent of gross loans at June 30, 1994, to 64.9 percent as of June 30, 1996. Construction loans decreased from 15.9 percent of gross loans at June 30, 1994, to 4.8 percent at June 30, 1996. Nonresidential real estate and land loans increased from 18.1 percent of gross loans at June 30, 1994, to 19.5 percent at June 30, 1996. Multifamily loans decreased from 7.5 percent in 1994 to 6.6 percent in 1996. The significant decrease in construction loans was offset by the Bank's increase in consumer loans and residential loans. The Bank's share of consumer loans witnessed an increase from 0.5 percent at June 30, 1994, to 3.4 percent at June 30, 1996.

7

GENERAL (CONT.)

Management's internal strategy has also included continued emphasis on maintaining an adequate and appropriate allowance for loan losses relative to loans and nonperforming assets in recognition of the more stringent requirements within the industry to establish and maintain a higher level of general valuation allowances and also in recognition of the Bank's planned increase in lending. At June 30, 1994, Home City Federal had $229,000 in its loan loss allowance or 0.67 percent of gross loans, which increased to $362,000 and represented a higher 0.79 percent of gross loans at June 30, 1996.

Interest income from loans and investments has been the basis of earnings with the net interest margin being the key determinant of net earnings. With a dependence on net interest margin for earnings, current management will focus on maintaining the Bank's net interest margin without undertaking excessive credit risk and will not pursue any significant change in its interest rate risk position.

8

PERFORMANCE OVERVIEW

Home City Federal's financial position over the past five fiscal years of June 30, 1992, through June 30, 1996, is highlighted through the use of selected financial data in Exhibit 5. Home City Federal has focused on strengthening its equity position, controlling its overhead ratio, increasing its savings and loan levels, and maintaining its net interest margin. Home City Federal has experienced a relatively strong rise in assets from 1992 to 1996 and a smaller but still moderate rate of increase in deposits with a greater than average increase in equity over the past five fiscal years. Due to the strong growth, the resultant impact has been a moderate increase in the Bank's equity to assets ratio from 1992 to 1996.

Home City Federal witnessed a total increase in assets of $13.4 million or 31.6 percent for the period of June 30, 1992, to June 30, 1996, representing an average annual increase in assets of 7.91 percent. For the year ended June 30, 1996, assets increased $7.1 million or 14.7 percent. Of those fiscal periods, the Bank experienced its largest dollar rise in assets of $8.9 million in fiscal year 1995, which represented a 22.5 percent increase in assets due primarily to a rise in deposits and increase in FHLB advances. This increase was succeeded by a $7.1 million or 14.7 percent increase in assets in fiscal year 1996.

The Bank's net loan portfolio, including mortgage loans and non-mortgage loans, increased from $28.9 million at June 30, 1992, to $45.2 million at June 30, 1996, and represented a total increase of $16.3 million, or 56.4 percent. The average annual increase during that period was 14.1 percent. That increase was the result of high levels of loan originations of one- to four-family loans. For the year ended June 30, 1996, loans increased $6.2 million or 15.9 percent.

Home City Federal has pursued obtaining funds through deposit growth in accordance with the demand for loans, and has also made use of FHLB advances during the past four years. The Bank's competitive rates for savings in its local market in conjunction with its focus on services have been the sources of retail deposits. Deposits

9

PERFORMANCE OVERVIEW (CONT.)

actually decreased from 1992 to 1993, followed by a smaller decrease in fiscal year 1994 and then strong increases in 1995 and in 1996, with an average annual rate of increase of 4.9 percent from June 30, 1992, to June 30, 1996. The Bank's strongest fiscal year deposit growth was in fiscal year 1993, when deposits increased $8.3 million or 13.8 percent.

Home City Federal has been able to increase its equity each fiscal year from 1992 through 1996. At June 30, 1992, the Bank had equity (GAAP basis) of $2.8 million representing a 6.69 percent equity to assets ratio, increasing to $5.3 million at June 30, 1996, and representing a 9.69 percent equity to assets ratio. The rise in the equity to assets ratio is the result of the Bank's stronger earnings performance in 1992 through 1996 combined with a strong rise in assets. Equity increased 86.1 percent from June 30, 1992, to June 30, 1996, representing an average annual increase of 21.53 percent.

10

INCOME AND EXPENSE

Exhibit 6 presents selected operating data for Home City Federal, reflecting the Bank's income and expense trends. This table provides selected audited income and expense figures in dollars for the fiscal years of 1992 through 1996.

Home City Federal has witnessed an increase in its dollar level of interest income from June 30, 1992, through June 30, 1996, ranging from a high of $4.5 million in 1996 to a low of $3.4 million in 1992, and representing a five year increase of 33.6 percent, or an average increase of 8.4 percent per year. This overall trend was a combination of a moderate increase from 1992 to 1995 followed by a strong increase from 1995 to 1996. In fiscal year 1996, interest income increased $672,000, or 17.5 percent to $4.5 million. The overall increase in interest income was due primarily to the Bank's increase in loan volume.

The Bank's interest expense experienced a declining trend from fiscal year 1992 to 1994, followed by strong increases in 1995 and 1996. Interest expense decreased $924,000, or 39.0 percent, from 1992 to 1994, compared to an increase in interest income of $103,000, or 3.0 percent, for the same time period. Interest expense then increased $496,000 or 34.3 percent from 1994 to 1995, compared to an increase in interest income of $293,000 or 8.3 percent. Such increase in interest income, was more than offset by the increase in interest expense and resulted in a decrease in annual net interest income to $1,893,000 for the fiscal year ended June 30, 1995, and a decrease in net interest margin. Net interest income increased from $1,069,000 in 1992 to its highest level of $2,096,000 in 1994. For the year ended June 30, 1996, interest expense increased $600,000 or 30.9 percent compared to an increase in interest income of a smaller $672,000 or 17.5 percent and resulting in an increase in net interest income.

The Bank has made provisions for loan losses in each of the past five fiscal years of 1992 through 1996. The amounts of those provisions were determined in recognition

11

INCOME AND EXPENSE (CONT.)

of the Bank's level of nonperforming assets, charge-offs and repossessed assets. The loan loss provisions were $52,000 in 1992, $83,000 in 1993, $113,000 in 1994, $109,000 in 1995 and $50,000 in 1996. The impact of these loan loss provisions has been to provide Home City Federal with a general valuation allowance of $362,000 at June 30, 1996, or 0.79 percent of gross loans and 146.6 percent of nonperforming loans.

Total other income or noninterest income indicated volatile levels in fiscal years 1992 to 1996, with higher than average levels in 1992 and 1993. The highest level of noninterest income was in fiscal year 1996 at $58,000 or 0.10 percent of assets and the lowest level at $1,000 was in 1992, representing zero percent of assets. The average noninterest income level for the past five fiscal years was $24,800 or 0.06 percent of average assets using actual noninterest income. In 1996, noninterest income was 0.10 percent of assets. Noninterest income consists primarily of service charges and other fees.

The Bank's general and administrative expenses or noninterest expenses increased from $845,000 for the fiscal year of 1992 to $1,216,000 for the fiscal year ended June 30, 1996. The dollar increase in noninterest expenses was $371,000 from 1992 to 1996, representing an average annual increase of $92,750 or 9.5 percent. The average annual increase in other expenses was due to the Bank's normal rise in overhead expenses. On a percent of average assets basis, operating expenses increased from 2.21 percent of average assets for the fiscal year ended June 30, 1992, to 2.31 percent for the fiscal year ended June 30, 1996, which was similar to current industry averages of approximately 2.35 percent.

The net earnings position of Home City Federal has indicated profitable performance in each of the past five fiscal years ended June 30, 1992 through 1996. The annual net income figures for the past five fiscal years of 1992, 1993, 1994, 1995 and 1996 have been $100,000, $665,000, $705,000, $555,000, and $514,000, representing

12

INCOME AND EXPENSE (CONT.)

returns on average assets of 0.26 percent, 1.66 percent, 1.69 percent, 1.24 percent, and 0.98 percent, respectively. The average return on assets for the past five fiscal years was 1.17 percent.

Exhibit 7 provides the Bank's normalized earnings or core earnings for fiscal years 1994 to 1996. The Bank's normalized earnings eliminate any nonrecurring income and expense items. There was a downward income adjustment of $46,000 in 1996 to reflect a one-time life insurance payment. This was the only adjustment for any of the periods.

The key performance indicators comprised of selected operating ratios, asset quality ratios and capital ratios are shown in Exhibit 8 to reflect the results of performance. The Bank's return on assets increased from .26 percent in fiscal year 1992 to its highest level of 1.69 percent in fiscal year 1994, decreasing to 1.24 percent in fiscal year 1995, and then down to 0.98 percent in 1996.

The Bank's average net interest rate spread strengthened from 3.12 percent in fiscal year 1992 to 4.58 percent in fiscal year 1993, then increased in 1994 to 4.88 percent followed by decreases in 1995 and 1996 to 3.42 percent. The Bank's net interest margin indicated a similar trend, increasing from 2.92 percent in fiscal year 1992 to 5.28 percent in fiscal year 1994 then decreasing to 4.36 percent in fiscal 1995, and then decreasing to 3.86 percent for the year ended June 30, 1996. Home City Federal's net interest rate spread increased 146 basis points in 1993 to 4.58 percent from 3.12 percent in 1992 and then increased 30 basis points in 1994 to 4.88 percent as the result of a decrease in yield. Net interest rate spread then decreased 93 basis points to 3.95 percent for fiscal year 1995 and decreased another 53 basis points to 3.42 percent for the fiscal year ended June 30, 1996. The Bank's net interest margin followed a similar trend, increasing 189 basis

13

INCOME AND EXPENSE (CONT.)

points to 4.81 percent in 1993 and then increasing 47 basis points to 5.28 percent in 1994. Net interest margin decreased 92 basis points to 4.36 percent in 1995 and continued to decrease to 3.86 percent in 1996.

The Bank's return on average equity increased from 1992 to 1993, but decreased in 1993 through 1995. The return on average equity increased from 3.52 percent in 1992 to 21.08 percent in fiscal year 1993, and then went down to 17.23 percent in fiscal year 1994. The return on equity then decreased to 12.20 percent in fiscal year 1995, and decreased further to 10.46 percent for the fiscal year ended June 30, 1996.

The Bank's ratio of non-interest expenses to average assets increased modestly from 2.21 percent in fiscal year 1992 to 2.31 percent in fiscal year 1996. Another key noninterest expense ratio reflecting efficiency of operation is the ratio of noninterest expenses to net interest income referred to as the "efficiency ratio". The industry norm is 60.0 percent. The Bank has been recently characterized with a normal efficiency reflected, which changed from 80.1 percent in 1992 reflective of lower earnings, to 60.1 percent in 1996.

Earnings performance can be affected by an institution's asset quality position. The ratio of nonperforming assets to total assets is a key indicator of asset quality. Home City Federal has witnessed a volatility in its nonperforming asset ratio from 1992 to 1996. Nonperforming assets consist of loans delinquent 90 days or more, nonaccruing loans and repossessed assets. The ratio of nonperforming assets to total assets was .12 percent at June 30, 1992, and increased to 0.96 percent at June 30, 1993. The ratio then decreased to 0.09 percent in 1994, up to 0.43 percent in 1995 and to 0.44 percent in 1996. The Bank's allowance for loan losses was 222.0 percent of nonperforming assets at June 30,

14

INCOME AND EXPENSE (CONT.)

1992, and was a lower 146.56 percent at June 30, 1996. As a percentage of loans, Home City Federal's allowance for loan losses increased 0.69 percent in 1993, 0.73 percent in 1994, 0.81 percent in 1995 and 0.79 percent in 1996.

Exhibit 9 provides the changes in net interest income due to rate and volume changes for the past two fiscal years of 1995 and 1996. In fiscal year 1995, net interest income decreased $203,000, due to an increase in interest expense of $496,000 partially offset by a $293,000 increase in interest income. The increase in interest income was due to an increase due to a change in volume of $428,000 reduced by a decrease due to change in rate of $135,000. The increase in interest expense was due to an increase due to rate of $163,000 accented by an increase due to a change in volume of $333,000.

In fiscal year 1996, net interest income increased $72,000, due to a $600,000 increase in interest expense more than offset by a $672,000 increase in interest income. The increase in interest income was due to a $749,000 increase due to volume reduced by a $77,000 decrease due to rate. The increase in interest expense was due to a $283,000 increase due to volume reduced by a $211,000 decrease due to rate.

15

YIELDS AND COSTS

The overview of yield and cost trends for the years ended June 30, 1994 to 1996, can be seen in Exhibit 10, which offers a summary of key yields on interest-earning assets and costs of interest-bearing liabilities.

Home City Federal's weighted average yield on its loan portfolio decreased 77 basis points from fiscal year 1994 to 1996, from 10.14 percent to 9.37 percent. The yield on mortgage-backed securities decreased 40 basis points from fiscal year 1994 to 1996 from 6.61 percent to 6.21 percent. The yield on investment securities increased 294 basis points from 3.03 percent in 1994 to 5.97 percent in 1996. Other interest-bearing deposits indicated an increase in their yield of 30 basis points from 4.14 percent in 1994 to 4.44 percent in 1996. The combined weighted average yield on all interest-earning assets decreased 6 basis points to 8.86 percent from 1994 to 1996.

Home City Federal's weighted average cost of interest-bearing liabilities increased 84 basis points to 4.88 percent from fiscal year 1994 to 1995, which was greater than the Bank's 9 basis point decrease in yield, resulting in the decline in the Bank's interest rate spread of 93 basis points from 4.88 percent to 3.95 percent from 1994 to 1995. The Bank's average cost of interest-bearing liabilities then increased from 1995 to 1996 by 56 basis points to 5.44 percent compared to a 3 basis point decrease in yield on interest-earning assets. The result was a continued decrease in the Bank's interest rate spread of 53 basis points to 3.42 percent for fiscal year 1996. The Bank's net interest margin decreased from 5.28 percent in fiscal year 1994 to 4.36 percent in fiscal year 1995, decreasing further to 3.86 percent for the year ended June 30, 1996.

16

INTEREST RATE SENSITIVITY

Home City Federal has monitored its interest rate sensitivity position due to its focus on the origination of fixed rate mortgage loans and its modest level of liquid assets at June 30, 1996. Home City Federal is aware of the thrift industry's historically higher interest rate risk exposure in the 1980's, which caused a negative impact on earnings and market value of portfolio equity as a result of significant fluctuations in interest rates, specifically rising rates. Such exposure was due to the disparate rate of maturity and/or repricing of assets relative liabilities commonly referred to as an institution's "gap". The larger an institution's gap, the greater the risk (interest rate risk) of earnings loss due to a decrease in net interest margin and a decrease in market value of equity or portfolio loss. In response to the potential impact of interest rate volatility and negative earnings impact, many institutions have taken steps in the 1990's to minimize their gap position. This frequently results in a decline in the institution's net interest margin and overall earnings performance.

The Bank measures its interest rate risk through the use of its net portfolio value ("NPV") of the expected cash flows from interest-earning assets and interest-bearing liabilities and any off-balance sheet contracts. The NPV for the Bank is calculated on a quarterly basis by the OTS as well as the change in the NPV for the Bank under rising and falling interest rates. Such changes in NPV under changing rates is reflective of the Bank's interest rate risk exposure.

There are other factors which have a measurable influence on interest rate sensitivity. Such key factors to consider when analyzing interest rate sensitivity include the loan payoff schedule, accelerated principal payments, deposit maturities, interest rate caps on adjustable-rate mortgage loans, and deposit withdrawals.

17

INTEREST RATE SENSITIVITY (CONT.)

Exhibit 11 provides the Bank's NPV as of June 30, 1996, and the change in the Bank's NPV under rising and declining interest rates. Such calculations are provided by OTS, and the focus of this exposure table is a 200 basis points change in interest rates either up or down.

The Bank's change in its NPV at June 30, 1996, based on a rise in interest rates of 200 basis points was a 25.0 percent decrease, representing a dollar decrease in equity value of $1,643,000. In contrast, based on a decline in interest rates of 200 basis points, the Bank's NPV was estimated to increase 14.0 percent or $918,000 at June 30, 1996. The Bank's exposure at June 30, 1996, increases to a 52.0 percent decrease under a 400 basis point rise in rates, and the NPV is estimated to increase 30.0 percent based on a 400 basis point decrease in rates.

The Bank is aware of its higher interest rate risk exposure under rapidly rising rates and strongly positive exposure under falling rates. Due to Home City Federal's recognition of the need to control its interest rate exposure, the Bank has been more active in short term consumer loans and more rate sensitive nonresidential real estate loans.

18

LENDING ACTIVITIES

Home City Federal has focused its lending activity on the origination of conventional mortgage loans secured by one- to four-family dwellings. Exhibit 12 provides a summary of Home City Federal's loan portfolio, by loan type, at June 30, 1994 through 1996.

Residential loans secured by one- to four-family dwellings excluding residential construction loans was the primary loan type representing a moderate 64.9 percent of the Bank's gross loans as of June 30, 1996. This share has seen a modest increase from 57.6 percent at June 30, 1994. The second largest real estate loan type as of June 30, 1996, was nonresidential real estate loans which comprised 14.9 percent of gross loans compared to a similar 15.1 percent as of June 30, 1994. The nonresidential real estate loan category was the third largest real estate loan type in 1994. The third key real estate loan type was multifamily loans, which represented 6.6 percent of gross loans as of June 30, 1996, compared to a slightly larger 7.5 percent at June 30, 1994. Multifamily loans were the fourth largest loan category in 1994. Construction loans were the fourth largest real estate loan type at June 30, 1996, with 4.8 percent of gross loans compared to a much higher 15.9 percent in 1994 and making it the second largest loan category in 1994. Most of the Bank's construction loans are single-family residential loans. These four real estate loan categories represented 91.9 percent of gross loans at June 30, 1996, compared to a larger 96.5 percent of gross loans at June 30, 1994. Land loans represented 4.6 percent of loans in 1996 and commercial loans represented a minimal 0.2 percent of gross loans at June 30, 1996, and did not exist at fiscal year end 1994.

The consumer loan category was the other loan type at June 30, 1996, and represented 3.4 percent of gross loans compared to only 0.5 percent at June 30, 1994. Consumer loans were the sixth largest overall loan type at June 30, 1996, and the sixth largest loan type in 1994. The Bank originates savings account loans, automobile loans, and other secured and unsecured personal loans. The overall mix of loans has witnessed

19

LENDING ACTIVITIES (CONT.)

moderate change from fiscal year-end 1994 to June 30, 1996, with the Bank having increased its share of consumer nonresidential real estate loans, and one- to four-family loans to offset its decrease in multifamily loans and construction loans.

The emphasis of Home City Federal's lending activity is the origination of conventional mortgage loans secured by one- to four-family residences. Such residences are located in Home City Federal's market area of Clark County. The Bank also originates interim construction loans on single-family residences primarily to individual owners and to developers and residential land loans. At June 30, 1996, 64.9 percent of Home City Federal's gross loans consisted of loans secured by one- to four-family residential properties, excluding construction loans. Construction loans represent another 4.8 percent of gross loans.

The Bank originates adjustable-rate mortgage loans, ("ARMs") with adjustment/maturity periods of one and three years. The interest rates on ARMs are indexed to the weekly average yield on the one- and three-year U.S. Treasury constant maturities index. The one-year and three-year ARMs have a maximum rate adjustment of 2.0 percent at each adjustment period and a 6.0 percent maximum adjustment over the life of the loan with payments based on up to a 30 year loan term.

The majority of ARMs have terms of up to 30 years, and fixed rate loans have normal terms of up to 15 years. The Bank normally retains all of its fixed rate loans. Historically, the majority of Home City Federal's mortgage loans are fixed-rate mortgage loans, which represented 50.3 percent of mortgage loans due after June 30, 1996. All of Home City Federal's consumer loans were fixed rate.

20

LENDING ACTIVITIES (CONT.)

The original loan to value ratio for conventional mortgage loans to purchase or refinance one-to four-family dwellings generally does not exceed 80 percent at Home City Federal, even though the Bank will grant loans with up to an 85 percent loan to value ratio, but private mortgage insurance is required for loans in excess of 85 percent. For loans in excess of 80 percent but less than 85 percent, private mortgage insurance can be waived by the Bank if the borrower has an approved co-signer.

Home City Federal has also been an originator of nonresidential real estate loans, and has been less active in multifamily loans in the past. The Bank will continue to make multifamily and nonresidential real estate loans. The Bank had a total of $9.5 million in nonresidential real estate loans at June 30, 1996, or 19.5 percent of gross loans, compared to $6.2 million or 18.1 percent of gross loans at June 30, 1994. Multifamily loans have increased from $2.6 or at June 30, 1994, to $3.2 million at June 30, 1996, but their share of loans has actually decreased from 7.5 percent to 6.6 percent over the same time period. The major portion of nonresidential real estate loans are secured by office buildings, churches, nursing homes, large farms, retail stores and other commercial properties.

Home City Federal has not been active in consumer lending in the past but has been relatively active in 1996. Consumer loans originated consist primarily of automobile loans, savings account loans, and personal loans, which represented a combined total of 3.4 percent of gross loans at June 30, 1996, up from 0.5 percent in 1994. At June 30, 1996, consumer loans totaled $1.7 million.

Exhibit 13 provides a breakdown and summary of Home City Federal's fixed- and adjustable-rate loans, indicating a predominance of fixed-rate loans. At June 30, 1996, 51.6 percent of the Bank's total loans due after June 30, 1997, were fixed-rate and 48.4 percent were adjustable-rate. While most loans are fixed-rate, it is evident that a relatively strong 57.4 percent of one- to four-family residential mortgage loans and 51.9 percent of total loans have maturities of less than 10 years.

21

LENDING ACTIVITIES (CONT.)

As indicated in Exhibit 14, Home City Federal experienced a modest decrease in its one-to four-family loan originations but a moderate increase in total loan originations from fiscal years 1994 to 1996. Total loan originations in fiscal year 1996 were $18.5 million compared to $14.6 million in fiscal year 1994, with fiscal year 1995 indicating a lower $14.0 million, reflective of a reduction in one-to four-family loans. The increase in one-to four-family residential loan originations from 1994 to 1996 constituted a $2.5 million increase with total loan originations increasing $3.8 million due to the increase in one- to four-family and consumer loans. Loan originations for the purchase of one- to four-family residences, including construction loans, represented 79.0 percent of total loan originations in fiscal year 1994, compared to a lower 65.8 percent in fiscal year 1995 and a higher 76.1 percent in fiscal year 1996. Overall, loan originations exceeded principal payments and repayments in fiscal 1994 by $2.6 million, exceeded reductions in fiscal year 1995 by $8.0 million, and exceeded reductions in fiscal 1996 by $6.3 million.

22

NONPERFORMING ASSETS

Home City Federal understands asset quality risk and the direct relationship of such risk to delinquent loans and nonperforming assets including real estate owned. The quality of assets has been a key concern to financial institutions throughout many regions of the country. A number of financial institutions have been confronted with rapid increases in their levels of nonperforming assets and have been forced to recognize significant losses, setting aside major valuation allowances. A sharp increase in nonperforming assets has often been related to specific regions of the country and has frequently been associated with higher risk loans, including purchased nonresidential real estate loans. Home City Federal has witnessed some volatility in its nonperforming assets and has made a concerted effort to control its nonperforming assets during the past five years.

Exhibit 15 provides a summary of Home City Federal's delinquent loans at June 30, 1994 through 1996, indicating a modest level of delinquent loans. Loans delinquent 90 days or more totaled $34,000 at June 30, 1994, and increased to $247,000 or 0.54 percent of gross loans at June 30, 1996, with delinquent loans of 30 days or more totaling only $982,000 or 2.15 percent of gross loans at June 30, 1996.

Home City Federal reviews each loan when it becomes delinquent 60 days or more, to assess its collectibility and to initiate direct contact with the borrower. The Bank sends the borrower a late payment notice within 15 days after the payment is due. The Bank then initiates both written and oral communication with the borrower if the loan remains delinquent. When the loan becomes delinquent at least 90 days, the Bank will consider foreclosure proceedings. The Bank does not normally accrue interest on loans past due 90 days or more. Most loans delinquent 90 days or more are placed on a non-accrual status, and at that point in time, the Bank may contact an attorney to pursue foreclosure procedures. Home City Federal had no real estate owned as of June 30, 1996, or at June 30, 1995.

23

NONPERFORMING ASSETS (CONT.)

Exhibit 16 provides a summary of Home City Federal's nonperforming assets at June 30, 1992 through 1996. Nonperforming assets consist of non-accrual loans, which includes loans delinquent 90 days or more, real estate acquired by foreclosure or by deed in lieu, and repossessed assets. The Bank has historically carried a lower than average level of nonperforming assets when compared to its peer group and the thrift industry in general. Home City Federal's level of nonperforming assets ranged from a high of $247,000 or 0.44 percent of total assets at June 30, 1996, to a low of $34,000 or 0.09 percent of assets at June 30, 1994.

Home City Federal's level of nonperforming assets is lower than its level of classified assets. The Bank's level of classified assets was $639,000 or 1.15 percent of assets at June 30, 1996 (reference Exhibit 17). The Bank's classified assets consisted of $518,000 in substandard assets, with $19,000 in assets classified as doubtful and $102,000 classified as loss.

Exhibit 18 shows Home City Federal's allowance for loan losses for fiscal years 1994 through 1996, indicating the activity and the resultant balances. Home City Federal has witnessed a moderate increase in its balance of allowance for loan losses from $229,000 in 1994 to $362,000 at June 30, 1996, with provisions of $113,000 in 1994, and $109,000 in fiscal 1995 and $50,000 in 1996. The Bank had charge-offs of $107,000 in 1994, $19,000 in 1995, and $7,000 in 1996 and recoveries of $25,000 in 1994. The Bank's ratio of allowance for loan losses to gross loans increased from 0.67 percent at June 30, 1994, to 0.80 percent at June 30, 1996, due to an increase in allowances with a significant increase in loans. Allowance for loan losses to nonperforming assets were 146.56 percent at June 30, 1996.

24

INVESTMENTS

The investment and securities portfolio of Home City Federal has been comprised of municipal securities, U.S. government and federal agency securities, interest-bearing deposits in other financial institutions, mortgage-backed securities, FHLMC stock and FHLB stock. Exhibit 19 provides a summary of Home City Federal's investment portfolio at June 30, 1994 through 1996. Investments were $4.6 million at June 30, 1996, compared to $4.6 million at June 30, 1995, and $3.2 million at June 30, 1994. The primary component of investments at June 30, 1996, was time deposits in other financial institutions, representing 22.9 percent, followed by U.S. government and federal agency securities representing 21.5 percent, for a combined total of 44.4 percent. The third key component was municipal securities representing 19.1 percent of investment securities. The securities portfolio had a weighted average yield of 5.42 percent, and the mortgage-backed securities had a weighted average yield of 6.21 percent for fiscal year 1996. The Bank also had cash and cash equivalents of $1.8 million or 3.3 percent of assets at June 30, 1996.

The Bank had mortgage-backed securities with a book value of $3.0 million at June 30, 1996, which decreased from $4.3 million at June 30, 1994, but increased from $2.1 million at June 30, 1992. Mortgage-backed securities are included in total investments and shown in Exhibit 19. Mortgage-backed securities represented a strong 46.9 percent of total investments including mortgage-backed securities at June 30, 1996, and a stronger 63.5 percent at June 30, 1994.

25

DEPOSIT ACTIVITIES

The change in the mix of deposits from June 30, 1994, to June 30, 1996, is provided in Exhibit 20. There has been a relatively strong change in both total deposits and in the deposit mix during this period. Certificates of deposit witnessed a strong increase in their share of deposits, rising from a modest 56.6 percent of deposits at June 30, 1994, to a strong 78.3 percent of deposits at June 30, 1996. The major component of certificates had rates between 6.0 percent and 8.0 percent and represented 57.2 percent of certificates at June 30, 1996. At June 30, 1994, the major component of certificates was the 4.01 percent to 6.00 percent category with 55.1 percent of certificates. Passbook accounts decreased in dollar amount from $16.0 million to $9.6 million, and their share decreased from 43.5 percent to 20.3 percent from June 30, 1994, to June 30, 1996, with modest decreases in rates during that period. NOW and demand accounts were introduced in 1996 and as a result, indicated an increase in their share of deposits from zero 1994 to 1.5 percent at June 30, 1996.

Exhibit 21 shows the Bank's deposit activity for the three years ended June 30, 1994 to 1996. Excluding interest credited, Home City Federal experienced net increases in deposits in fiscal years 1995 and 1996 and a net decrease in 1994. In fiscal year 1994, there was a net decrease in deposits of $1.9 million or 5.1 percent, followed by a $6.1 million increase or 17.6 percent in 1995. In fiscal year 1996, an increase in deposits of $6.2 million resulted in a 15.2 percent increase in deposits.

BORROWINGS

Home City Federal has relied on retail deposits as its primary source of funds but has made use of FHLB advances during the past four fiscal years ended June 30, 1996. Exhibit 22 shows the Bank's FHLB advances activity during the past three fiscal years. The Bank's balance of FHLB advances has increased from $424,000 at June 30, 1994, to $2,903,000 at June 30, 1996.

26

SUBSIDIARIES

Home City Federal has one wholly-owned subsidiary, Homeciti Service Corporation ("Homeciti"), an Ohio corporation, whose primary purpose is to own stock in Intrieve Corporation, the Bank's data processing company. Homeciti also has an .875 percent ownership interest in a joint venture which owns a local hotel, Springfield Inn. At June 30, 1996, the Bank's investment in the subsidiary was $54,000.

OFFICE PROPERTIES

Home City Federal has one office, its home office located in downtown Springfield. Home City Federal owns its home office which provides off-street parking and one drive-in window facility but no ATM access. The Bank's investment in its office premises, excluding furniture, fixtures and equipment, totaled $537,000 or 0.96 percent of assets at June 30, 1996. The Bank does have long term plans to build a new home office due to the need for additional space. The estimated cost of a new home office is $1.5 million with completion expected in 1999. By June 30, 1997, the Bank does foresee spending approximately $250,000 for a site for the proposed new home office.

MANAGEMENT

The president, chief executive officer, and managing officer of Home City Federal is Douglas L. Ulery. Mr. Ulery joined the Bank in 1992, as president. Mr. Ulery became a director in 1994. Mr. Ulery was previously employed with Society National Bank as vice president of Regional Banking Offices Operation and worked in their Dayton office (reference Exhibit 22).

27

II. DESCRIPTION OF PRIMARY MARKET AREA

Home City Federal Savings Bank's primary market area encompasses the city of Springfield and those outer communities surrounding its office, including all of Clark County, Ohio ("the market area"). The Bank's home office is located in downtown Springfield, Ohio.

The market area is characterized by lower than average levels of income and housing values and a slightly higher unemployment level. The market area's strongest employment categories are wholesale/retail trade, services and manufacturing with a lower level of residents employed in the finance, insurance and real estate industry category.

Exhibit 24 provides a summary of key demographic data and trends for the market area, Ohio and the United States for the periods of 1990, 1995, and 2000. The market area showed a lower increase in population than Ohio, while the United States showed the highest increases. Overall, the period of 1990 to 1995 was characterized by a small increase of 0.2 percent in the market area population, which increased from 147,548 to 147,906 residents, compared to an increase in population of 2.8 percent in Ohio and a rise in the national population level by 5.7 percent. During the period of 1995 through 2000, population is projected to continue to rise in the market area by a small 0.2 percent, increasing to 148,255 residents, while population is expected to increase in Ohio by 2.7 percent, and in the United States by 5.4 percent.

In conformance with its relatively unchanging trend in population, the market area witnessed a small increase in households (families) of 0.3 percent and 0.2 percent, from 1990 to 1995 and from 1995 to 2000, respectively. These increases are much lower than Ohio's increase in households of 2.7 percent for the same time periods. The United States continued to have the largest increases, growing by 5.6 percent from 1990 to 1995, and 5.3 percent from 1995 to 2000. From 1990 to 1995, the market area increased its households from 55,198 to 55,351. By the year 2000, the market area is projected to have 55,482 households.

28

DESCRIPTION OF PRIMARY MARKET AREA (CONT.)

The market area had lower per capita income levels than Ohio or the United States in 1990 and 1995. In 1990, the market area had an average per capita income of $11,587. Ohio had a per capita income of $12,788, while the United States also had a higher per capita income of $12,313. From 1990 to 1995, the United States had the largest percent increase in per capita income, followed by the market area and then by Ohio. The market area increased its per capita income level by 27.1 percent to $14,727 in 1995, Ohio increased its per capita income by 22.8 percent to $15,708, while the United States had an increase in its per capita income of 33.2 percent to $16,405.

Median household income figures for the market area were at lower levels than Ohio or the United States for 1990 and 1995, and are projected to remain lower through the year 2000. In 1990, the average median household income for the market area was $27,868. The median household income levels for Ohio and the United States were $29,276 and $28,255, respectively. From 1990 to 1995, the market area's median household income increased by 16.0 percent to $32,325. Ohio's median household income level grew by a smaller 12.9 percent to $33,038 and the United States had an increase in its median household income level by a larger 19.0 percent to $33,610. By the year 2000, the market area, Ohio and the United States are projected to witness declines in their median household income levels to $31,771, $32,477 and $32,972, respectively.

Exhibit 25 provides a summary of key housing data for the market area, Ohio, and the United States. Home City Federal's market area has a 69.1 percent rate of owner-occupancy, slightly higher than the 67.5 percent owner-occupancy rate for Ohio and moderately higher than the 64.2 percent for the United States. As a result, the market area supports a lower rate of renter-occupied housing at 30.9 percent compared to 32.5 percent for Ohio and a higher 35.8 percent for the United States.

29

DESCRIPTION OF PRIMARY MARKET AREA (CONT.)

The market area's median housing value of $54,900 is lower than both Ohio and the United States in median housing value. Ohio's median housing value of $63,457 is 13.5 percent higher than the market area's median housing value. The United States' $79,098 median housing value is 30.6 percent greater than that of the market area. The average median rent of the market area is surpassed by the median rent of Ohio and the United States. Clark County had a median rent of $256, which was lower than Ohio's median rent of $296 and the United States' median rent value of $374.

The major business source of employment by industry group, based on number of employees for the market area was the wholesale/retail industry responsible for 30.4 percent of jobs in 1993 which was higher than Ohio at 27.7 percent and also higher than the United States at 27.5 percent (reference Exhibit 26). The major employer in Ohio and the United States was the services industry responsible for a 31.6 percent and a 34.0 percent share of total employment in 1993, respectively. The services industry was the second major employer in the market area at 30.1 percent. The manufacturing group was the third major employer in the market area at 27.3 percent, a lower 24.5 percent in Ohio and 19.2 percent in the United States. The construction group, finance, insurance and real estate group, transportation/utilities group, and the agriculture/mining group combined to 12.0 percent of employment in the market area, 16.2 percent of employment in Ohio, and 19.3 percent in the United States.

30

DESCRIPTION OF PRIMARY MARKET AREA (CONT.)

The leading employers in the market area are:

Employer                            Product/Service          Number of Employees
- --------                            ---------------          -------------------
Navistar International             Trucks and related items        5,400
Wright-Patterson Air Force Base    Government                      2,281
Emro Marketing - Speedway          Service station                   580
Olan Mills of Ohio                 Photography                       450
O'Cedar/Vining Household
      Products Co.                 Stock goods                       395
Moyno Industrial Products          Pumps and parts                   390
Cooper Cameron Corporation         Large engines and compressors     385

An economic indicator that pertains more directly to the banking and thrift industries is the issuance of new housing permits and permits for commercial buildings because of its direct relationship to lending activity (reference Exhibit 27). In 1991, 423 new housing permits were authorized in the market area, 29,542 in Ohio, and 796,647 in the United States. In 1992, the issuance of new housing permits authorized remained relatively unchanged in the market area as permits decreased by 0.2 percent to 422 new permits. Ohio and the United States witnessed positive growth rates of 16.3 percent and 20.1 percent, respectively, with 34,361 and 956,494 new housing permits authorized. In 1993, the market area once again remained relatively unchanged, while Ohio and the United States witnessed increases in the number of new housing permits authorized. The market area authorized 426 new permits, an increase of 0.9 percent, Ohio authorized 37,477 new permits, a growth of 9.1 percent, while the United States exhibited a growth of 8.6 percent with 1,038,907 new permits.

31

DESCRIPTION OF PRIMARY MARKET AREA (CONT.)

Commercial building permits in Ohio followed a similar pattern for the years 1991 through 1993, with a large increase in 1992 followed by a smaller increase in 1993. Ohio increased its permit activity by 1.9 percent from 1991 to 1992 issuing commercial building permits with a value of $2.34 billion in 1992 compared to $2.3 billion in 1991. In 1993, Ohio experienced a slight decrease of 1.3 percent in commercial building permit valuations to $2.31 billion. In 1992, the United States witnessed a slight decline in commercial building permit valuations of 0.1 percent, from $56.9 billion in 1991 to $56.8 billion in 1992. The United States rebounded in 1993 with growth of 8.1 percent, rising to $61.43 billion in the value of new commercial building permits issued.

The unemployment rate is another key economic indicator. Exhibit 28 shows the average unemployment rates in the market area, Ohio, and the United States in 1994, 1995 and June, 1996. The market area has historically been characterized by a similar yet lower unemployment rates than Ohio and the United States. The market area had a decrease in its unemployment rate from 4.9 percent to 4.6 percent in 1995. Ohio had a decrease in its unemployment rate from 5.5 percent to 4.9 percent and the United States' unemployment rate decreased from 6.1 percent to 5.2 percent in that same time period. In June 1996, unemployment increased in the market area, Ohio and the United States. The market area had the highest unemployment at 5.7 percent, compared to the United States at 5.5 percent, and Ohio at 5.0 percent.

Exhibit 29 provides deposit data for banks, thrifts and credit unions in Clark County. Home City Federal's deposit base in Clark County was $40.9 million or 20.5 percent of the $200.0 million total thrift deposits but a much smaller 3.2 percent share of total deposits which totaled $1.3 billion. The market area is clearly dominated by the banking industry. Total deposits were $974.7 million with 76.6 percent in bank deposits, compared to a lower $200.1 million or 15.7 percent of deposits for thrifts, and a strong $98.4 million or 7.7 percent of total deposits held by credit unions. It is evident from the

32

DESCRIPTION OF PRIMARY MARKET AREA (CONT.)

size of both thrift deposits and bank deposits that Clark County has a moderate deposit base with the Bank having a moderate level of market penetration of all thrift deposits, but a small level of market penetration for total deposits.

Exhibit 30 provides interest rate data for each quarter for the years 1992 through 1995 and for the first quarter of 1996. The interest rates tracked are the Prime Rate, as well as 90-Day, One-Year and Thirty-Year Treasury Bills. Interest rates experienced a declining trend in the first two quarters of 1992, but then began to rise in the second half of the year. In 1993 rates experienced slight volatility until the last two quarters, which indicated the beginning of a rising trend. This rising trend continued throughout all of 1994 and into the first quarter of 1995 with prime at 9.00 percent. However, throughout 1995, interest rates saw dramatic decreases, as the prime rate fell to its 1994 year end level of 8.50 percent. Such decrease in the prime rate continued through the first quarter of 1996 as it fell to 8.25 percent and then remained at 8.25 percent through the second quarter in 1996. Rates on T-bills, however, witnessed an increase with 30-Year Treasury Bills experiencing the largest increase.

SUMMARY

To summarize, Home City Federal's market area represents an area with a stagnant population and no significant change in the number of households during the mid 1990s. Clark County has evidenced lower per capita income and median household income compared to both Ohio and the United States. The market area also has a lower median housing value and average median rent level than Ohio and the United States. Further, the market area has a moderately competitive financial institution market dominated by banks with a total deposit base of approximately $1.3 billion for all of Clark County.

33

III. COMPARABLE GROUP SELECTION

INTRODUCTION

Integral to the valuation of Home City Financial Corporation is the selection of an appropriate group of publicly-traded thrift institutions, hereinafter referred to as the "comparable group". This section identifies the comparable group and describes each parameter used in the selection of each institution in the group, resulting in a comparable group based on such specific and detailed parameters, current financials and recent trading prices. The various characteristics of the selected comparable group provide the primary basis for making the necessary adjustments to the Corporation's pro forma value relative to the comparable group. There is also a recognition and consideration of financial comparisons with all publicly-traded, SAIF- insured thrifts in the United States and all publicly-traded, SAIF-insured thrifts in the Midwest and Ohio.

Exhibits 31 and 32 present Thrift Stock Prices and Pricing Ratios and Key Financial Data and Ratios, respectively, both individually and in aggregate, for the universe of 338 publicly-traded, SAIF-insured thrifts in the United States ("all thrifts"), excluding mutual holding companies, used in the selection of the comparable group and other financial comparisons. Exhibits 31 and 32 also subclassify all thrifts by region, including the 154 publicly-traded Midwest thrifts ("Midwest thrifts") and the 31 publicly-traded thrifts in Ohio ("Ohio thrifts"), and by trading exchange. Exhibit 33 presents prices, pricing ratios and price trends for all SAIF-insured thrifts completing their conversions between January 1, 1996, and September 6, 1996.

The selection of the comparable group was based on the establishment of both general and specific parameters using financial, operating and asset quality characteristics of Home City Federal as determinants for defining those parameters. The determination of parameters was also based on the uniqueness of each parameter as a normal indicator

34

INTRODUCTION (Cont.)

of a thrift institution's operating philosophy and perspective. The parameters established and defined are considered to be both reasonable and reflective of Home City Federal's basic operation. In as much as the comparable group must consist of at least ten institutions, the parameters relating to asset size and geographic location have been expanded as necessary in order to fulfill this requirement.

GENERAL PARAMETERS

MERGER/ACQUISITION

The comparable group will not include any institution that is in the process of a merger or acquisition due to the price impact of such a pending transaction. The thrift institutions that were potential comparable group candidates but were not considered due to their involvement in a merger/acquisition or a potential merger/acquisition include the following:

        Institution                         State
        -----------                         -----
Financial Security Corp.                    Illinois
Workingmens Capital Holdings                Indiana
Marshalltown Financial Corp.                Iowa
Circle Financial Corp.                      Ohio
Seven Hills Financial Corp.                 Ohio
Third Financial Corp.                       Ohio
Bridgeville Savings Bank                    Pennsylvania

No thrift institution in Home City Federal's city, county or market area is currently involved in merger/acquisition activity or have been recently so involved, as indicated in Exhibit 34.

35

MUTUAL HOLDING COMPANIES

The comparable group will not include any mutual holding companies. Mutual holding companies typically demonstrate higher price to book valuation ratios that are the result of their minority ownership structure that are inconsistent with those of conventional, publicly-traded institutions. Exhibit 35 presents pricing ratios and Exhibit 36 presents key financial data and ratios for all publicly-traded, SAIF-insured mutual holding companies in the United States. The following thrift institutions were potential comparable group candidates, but were not considered due to their mutual holding company form:

           Institution                               State
           -----------                               -----

Webster City Federal Savings Bank, MHC               Iowa
Wayne Savings & Loan Co., MHC                        Ohio
Greater Delaware Valley Savings Bank, MHC            Pennsylvania

TRADING EXCHANGE

It is necessary that each institution in the comparable group be listed on one of the two major stock exchanges, the New York Stock Exchange or the American Stock Exchange, or traded over-the-counter ("OTC") and listed on the National Association of Securities Dealers Automated Quotation System ("NASDAQ"). Such a listing indicates that an institution's stock has demonstrated trading activity and is responsive to normal market conditions, which are requirements for listing. Of the 356 publicly-traded, SAIF-insured institutions, including 18 mutual holding companies, 14 are traded on the New York Stock Exchange, 17 are traded on the American Stock Exchange and 325 are listed on NASDAQ.

36

IPO DATE

Another general parameter for the selection of the comparable