exv99

EXHIBIT 99

275 West Federal Street
Youngstown, Ohio 44503-1203

FOR IMMEDIATE RELEASE


Media Contact:		Investor Contact:
Colleen Scott		James R. Reske
Vice President of Marketing		Chief Financial Officer
Home Savings		United Community Financial Corp.
(330) 742-0638		(330) 742-0592
cscott@homesavings.com		jreske@ucfconline.com

United Community Financial Corp. Announces Second Quarter Results

YOUNGSTOWN, Ohio (August 12, 2011) — United Community Financial Corp. (Company) (Nasdaq: UCFC), holding company of The Home Savings and Loan Company of Youngstown, Ohio (Home Savings), today reported a consolidated net loss of $1.8 million, or $(0.06) per diluted share, for the three months ended June 30, 2011. This compares to a net loss of $4.9 million, or $(0.16) per diluted share, for the three months ended June 30, 2010. The Company also reported cumulative net income of $1.2 million, or $0.04 per diluted share, for the six months ended June 30, 2011, as compared to a cumulative net loss of $10.0 million, or $(0.33) per diluted share, for the six months ended June 30, 2010.

Selected second quarter results:

•

Delinquent loans declined $16.5 million to $141.8 million from the prior quarter

•

Nonperforming loans declined $6.8 million to $139.1 million from the prior quarter

•

Nonperforming assets declined $6.0 million to $182.8 million from the prior quarter

•

Home Savings’ Tier 1 leverage ratio decreased 4 basis points from the prior quarter to 8.40%, still exceeding its required regulatory threshold of 8.00%. Total Risk Based Capital increased 45 basis points from the prior quarter to 13.47%

•

Tangible book value per share at June 30, 2011 was $5.90, up from $5.72 at March 31, 2011

Net Interest Income and Margin

Net interest income for the three months ended June 30, 2011 was $17.1 million compared to $18.0 million for the three months ended June 30, 2010. Total interest income decreased $3.3 million in the second quarter of 2011 compared to the second quarter of 2010, primarily as a result of a decrease of $204.1 million in the average balance of outstanding loans. The Company also experienced a decrease in the yield on net loans of 17 basis points. Total interest expense, however, decreased $2.4 million for the quarter ended June 30, 2011, as compared to the same quarter last year. The change was due primarily to reductions of $2.3 million in interest paid on deposits. The overall decrease in interest expense was attributable to a shift in deposit balances from certificates of deposit to relatively less expensive non-time deposits.

Net interest margin was 3.39% for the second quarter of 2011 compared with 3.30% for the second quarter of 2010.

Net interest income for the six months ended June 30, 2011, was $34.7 million compared to $35.7 million for the six months ended June 30, 2010. Total interest income decreased $6.4 million in the first six months of 2011 compared to the first six months of 2010, primarily as a result of a decrease of $209.6 million in the average balance of outstanding loans during the six month period ended June 30, 2011. The Company also experienced a decrease in the yield on net loans of 13 basis points. Total interest expense decreased $5.4 million for the six months ended June 30, 2011, as compared to the same period last year. The change was due primarily to reductions of $5.3 million in interest paid on deposits.

Net interest margin was 3.45% for the first six months of 2011 compared with 3.29% for the first six months of 2010.

Asset Quality

Nonperforming loans at June 30, 2011 decreased to $139.1 million, compared to $145.9 million at March 31, 2011, a decrease of $6.8 million during the period. Additional declines were seen in both delinquent loans and nonaccrual loans during the same time period. Delinquent loans declined to $141.8 million at June 30, 2011 from $158.3 at March 31, 2011. During the same time period nonperforming assets decreased $6.0 million to $182.8 million.

Patrick W. Bevack, President and Chief Executive Officer of UCFC and Home Savings, commented that, “We are encouraged by the positive trend of decreasing past-due loans. Nonperforming loans and nonperforming assets were also down quarter over quarter. Continuing these trends and the resolution of problem assets remains our top priority.”

Noninterest Income

Noninterest income increased in the second quarter of 2011 to $5.3 million, as compared to $4.7 million in the second quarter of 2010. Affecting this comparison was the recognition of increased service fees during 2011. Service fees in the second quarter of 2010 were $424,000, but were negatively affected by a valuation allowance of $1.3 million for mortgage servicing rights; in the second quarter of 2011, the valuation allowance for such mortgage servicing rights were partially recovered, resulting in an $84,000 contribution to service fees. The second quarter of 2011 also reflected securities gains of $229,000, compared with $3.6 million that were recognized in the second quarter of 2010. Finally, the second quarter of 2011 included a gain of $2.7 million from a bulk mortgage loan sale.

Noninterest income decreased in the first half of 2011 to $9.3 million, as compared to the first half of 2010 of $11.3 million. Driving the decrease in noninterest income was the recognition of lower gains on the sale of securities and the gain recognized on the sale of Home Savings’ Findlay, Ohio branch in the prior year.

Noninterest Expense

Noninterest expense was $15.9 million in the second quarter of 2011, compared to $17.3 million in the second quarter of 2010. The decrease in noninterest expense was triggered by lower salaries and employee benefits paid to employees. This decrease was caused primarily as a result of the Employee Stock Ownership Plan’s repayment in 2010 of the loan made by the Company to the ESOP.

Noninterest expense was $32.4 million in the first six months of 2011, compared to $34.3 million in the first six months of 2010. The decrease in noninterest expense for the period was affected by lower salaries and employee benefits paid to employees.

Capital and Book Value

Home Savings’ Tier 1 leverage ratio was 8.40% as of June 30, 2011, compared to 8.44% at March 31, 2011. The Company’s total risk-based capital ratio was 13.47% at June 30, 2011, as compared to 13.02% at March 31, 2011. Tangible book value per share at June 30, 2011 was $5.90, up from $5.72 at March 31, 2011.

Home Savings is a wholly-owned subsidiary of the Company and operates 38 full-service banking offices and seven loan production offices located throughout Ohio and western Pennsylvania. Additional information on the Company and Home Savings may be found on the Company’s web site: www.ucfconline.com.

###

When used in this press release, the words or phrases “believes,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties, including changes in economic conditions in the Company’s market area, changes in policies by regulatory agencies, fluctuations in interest rates, demand for loans in the Company’s market area, and competition that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. The Company cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company advises readers that the factors listed above could affect the Company’s financial performance and could cause the Company’s actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements.

The Company does not undertake, and specifically disclaims any obligation, to release publicly the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

UNITED COMMUNITY FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Unaudited)


	June 30,			December 31,
	2011			2010
	(Dollars in thousands)
Assets:
Cash and deposits with banks	$	25,085		$	18,627
Federal funds sold and other		30,413			18,480

Total cash and cash equivalents		55,498			37,107
Securities:
Available for sale, at fair value		392,749			362,042
Loans held for sale		4,824			10,870
Loans, net of allowance for loan losses of $46,223 and $50,883, respectively		1,509,399			1,649,486
Federal Home Loan Bank stock, at cost		26,464			26,464
Premises and equipment, net		21,489			22,076
Accrued interest receivable		7,201			7,720
Real estate owned and other repossessed assets		43,685			40,336
Core deposit intangible		412			485
Cash surrender value of life insurance		27,822			27,303
Other assets		12,876			13,409

Total assets	$	2,102,419		$	2,197,298


Liabilities and Shareholders’ Equity
Liabilities:
Deposits:
Interest bearing	$	1,559,045		$	1,551,210
Non-interest bearing		138,752			138,571

Total deposits		1,697,797			1,689,781
Borrowed funds:
Federal Home Loan Bank advances		96,365			202,818
Repurchase agreements and other		98,962			97,797

Total borrowed funds		195,327			300,615
Advance payments by borrowers for taxes and insurance		15,963			20,668
Accrued interest payable		838			809
Accrued expenses and other liabilities		9,352			9,370

Total liabilities		1,919,277			2,021,243


Shareholders’ Equity:
Preferred stock-no par value; 1,000,000 shares authorized and unissued		—			—
Common stock-no par value; 499,000,000 shares authorized; 37,804,457 shares issued and 30,968,960 and 30,937,704 shares, respectively, outstanding		142,513			142,318
Retained earnings		111,910			111,049
Accumulated other comprehensive income (loss)		923			(4,778	)
Treasury stock, at cost, 6,835,497 and 6,866,753 shares, respectively		(72,204	)		(72,534	)

Total shareholders’ equity		183,142			176,055

Total liabilities and shareholders’ equity	$	2,102,419		$	2,197,298

UNITED COMMUNITY FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)


	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
	(Dollars in thousands, except per share data)
Interest income
Loans	$	21,421		$	24,918		$	43,931		$	50,761
Loans held for sale		41			69			107			139
Securities:
Available for sale		3,094			2,896			5,941			5,481
Federal Home Loan Bank stock dividends		294			294			594			594
Other interest earning assets		13			8			22			15

Total interest income		24,863			28,185			50,595			56,990
Interest expense
Deposits		6,081			8,408			12,412			17,726
Federal Home Loan Bank advances		796			875			1,621			1,723
Repurchase agreements and other		928			931			1,850			1,854

Total interest expense		7,805			10,214			15,883			21,303

Net interest income		17,058			17,971			34,712			35,687
Provision for loan losses		8,244			10,310			10,436			22,760

Net interest income after provision for loan losses		8,814			7,661			24,276			12,927

Non-interest income
Non-deposit investment income		308			484			662			912
Service fees and other charges		1,588			424			3,041			2,175
Net gains (losses):
Securities available for sale		229			3,671			1,542			6,514
Other -than-temporary loss on equity securities
Total impairment loss		(28	)		—			(38	)		—
Loss recognized in other comprehensive income		—			—			—			—

Net impairment loss recognized in earnings		(28	)		—			(38	)		—
Mortgage banking income		3,128			651			3,750			1,037
Real estate owned and other repossessed assets		(1,362	)		(1,755	)		(2,354	)		(3,239	)
Gain on retail branch sale		—			—			—			1,387
Other income		1,437			1,270			2,685			2,519

Total non-interest income		5,300			4,745			9,288			11,305

Non-interest expense
Salaries and employee benefits		7,686			9,105			15,370			17,279
Occupancy		856			839			1,761			1,843
Equipment and data processing		1,624			1,720			3,318			3,387
Franchise tax		402			503			871			1,014
Advertising		141			147			262			369
Amortization of core deposit intangible		36			45			73			93
Deposit insurance premiums		1,057			1,459			2,462			2,920
Professional fees		293			940			1,255			1,973
Real estate owned and other repossessed asset expenses		891			1,024			1,764			1,631
Other expenses		2,924			1,509			5,262			3,750

Total non-interest expenses		15,910			17,291			32,398			34,259

Income (loss) before income taxes		(1,796	)		(4,885	)		1,166			(10,027	)
Income tax expense (benefit)		—			—			—			—

Net income (loss)	$	(1,796	)	$	(4,885	)	$	1,166		$	(10,027	)


Earnings (loss) per share
Basic	$	(0.06	)	$	(0.16	)		0.04			(0.33	)
Diluted		(0.06	)		(0.16	)		0.04			(0.33	)

UNITED COMMUNITY FINANCIAL CORP.
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited)


	At or for the quarters ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2011			2011			2010			2010			2010
	(In thousands, except per share data)
Financial Data
Total assets	$	2,102,419		$	2,115,080		$	2,197,298		$	2,317,948		$	2,314,109
Total loans, net		1,509,399			1,620,094			1,649,486			1,726,381			1,786,038
Total securities		392,749			289,388			362,042			390,636			307,154
Total deposits		1,697,797			1,712,523			1,689,781			1,685,033			1,696,531
Total shareholders’ equity		183,142			177,371			176,055			201,333			212,691
Net interest income		17,058			17,654			16,888			18,786			17,971
Provision for loan losses		8,244			2,192			22,551			17,116			10,310
Noninterest income, excluding other-than-temporary impairment losses		5,328			3,998			6,487			4,159			4,745
Net impairment losses recognized in earnings		28			10			14			44			—
Noninterest expense		15,910			16,488			18,372			15,700			17,291
Income tax expense (benefit)		—			—			(231	)		—			—
Net income (loss)		(1,796	)		2,962			(17,331	)		(9,915	)		(4,885	)

Share Data
Basic earnings (loss) per share	$	(0.06	)	$	0.10		$	(0.56	)	$	(0.32	)	$	(0.16	)
Diluted earnings (loss) per share		(0.06	)		0.10			(0.56	)		(0.32	)		(0.16	)
Book value per share		5.91			5.73			5.69			6.51			6.88
Tangible book value per share		5.90			5.72			5.67			6.49			6.87
Market value per share		1.27			1.33			1.34			1.33			1.68

Shares outstanding at end of period		30,969			30,951			30,938			30,925			30,898
Weighted average shares outstanding—basic		30,932			30,917			30,906			30,899			30,039
Weighted average shares outstanding—diluted		30,932			30,919			30,906			30,899			30,039

Key Ratios
Return on average assets		-0.34	%		0.55	%		-3.06	%		-1.70	%		-0.85	%
Return on average equity		-3.95	%		6.56	%		-33.91	%		-18.41	%		-8.91	%
Net interest margin		3.39	%		3.49	%		3.17	%		3.42	%		3.30	%
Efficiency ratio		67.49	%		77.12	%		78.08	%		66.80	%		82.92	%

Capital Ratios
Tier 1 leverage ratio		8.40	%		8.44	%		7.84	%		8.23	%		8.71	%
Tier 1 risk-based capital ratio		12.20	%		11.74	%		11.26	%		11.85	%		11.90	%
Total risk-based capital ratio		13.47	%		13.02	%		12.54	%		13.12	%		13.16	%
Equity to assets		8.71	%		8.39	%		8.01	%		8.69	%		9.19	%
Tangible common equity to tangible assets		8.69	%		8.37	%		7.99	%		8.67	%		9.17	%

UNITED COMMUNITY FINANCIAL CORP.
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited)


	At or for the quarters ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2011			2011			2010			2010			2010
	(Dollars in thousands)
Loan Portfolio Composition
Real Estate Loans
One-to four-family residential	$	693,435		$	762,065		$	757,426		$	778,005		$	779,565
Multi-family residential*		129,767			131,246			135,771			136,681			138,875
Nonresidential*		307,702			328,772			331,390			355,914			383,882
Land*		25,515			25,624			25,138			25,413			26,217
Construction Loans
One-to four-family residential and land development		87,827			88,075			108,583			117,297			133,534
Multi-family and nonresidential*		5,524			11,201			15,077			14,537			14,870

Total real estate loans		1,249,770			1,346,983			1,373,385			1,427,847			1,476,943
Consumer Loans		266,075			272,478			279,453			289,296			295,007
Commercial Loans		38,354			45,772			46,304			48,902			53,566

Total Loans		1,554,199			1,665,233			1,699,142			1,766,045			1,825,516
Less:
Allowance for loan losses		46,223			46,415			50,883			40,884			40,728
Deferred loan costs, net		(1,423	)		(1,276	)		(1,227	)		(1,220	)		(1,250	)

Total		44,800			45,139			49,656			39,664			39,478

Loans, net	$	1,509,399		$	1,620,094		$	1,649,486		$	1,726,381		$	1,786,038


*		Such categories are considered commercial real estate


	At or for the quarters ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2011			2011			2010			2010			2010
	(Dollars in thousands)
Deposit Portfolio Composition
Checking accounts
Interest bearing checking accounts	$	112,412		$	110,711		$	110,092		$	103,204		$	104,905
Non-interest bearing checking accounts		138,752			144,362			138,571			128,702			126,437

Total checking accounts		251,164			255,073			248,663			231,906			231,342
Savings accounts		245,838			234,295			218,946			214,197			212,778
Money market accounts		322,955			318,395			311,692			310,884			310,506

Total non-time deposits		819,957			807,763			779,301			756,987			754,626
Retail certificates of deposit		877,840			904,760			910,480			928,046			939,568
Brokered certificates of deposit		—			—			—			—			2,337

Total certificates of deposit		877,840			904,760			910,480			928,046			941,905

Total deposits	$	1,697,797		$	1,712,523		$	1,689,781		$	1,685,033		$	1,696,531

Certificates of deposit as a percent of total deposits		51.70	%		52.83	%		53.88	%		55.08	%		55.52	%

UNITED COMMUNITY FINANCIAL CORP.
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited)


	At or for the quarters ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2011			2011			2010			2010			2010
	(Dollars in thousands)
Allowance For Loan Losses
Beginning balance	$	46,415		$	50,883		$	40,884		$	40,728		$	47,768
Provision		8,244			2,192			22,551			17,116			10,310
Net chargeoffs		(8,436	)		(6,660	)		(12,552	)		(16,960	)		(17,350	)

Ending balance	$	46,223		$	46,415		$	50,883		$	40,884		$	40,728


Net Charge-offs
Real Estate Loans
One-to four-family	$	501		$	924		$	1,483		$	1,834		$	2,318
Multi-family		1,451			163			1,819			160			1,067
Nonresidential		1,873			1,038			6,923			7,041			25
Land		233			504			284			11			—
Construction Loans
One-to four-family residential and land development		1,159			2,295			669			6,595			11,924
Multi-family and nonresidential		101			—			(1	)		—			310

Total real estate loans		5,318			4,924			11,177			15,641			15,644
Consumer Loans		642			856			639			905			1,330
Commercial Loans		2,476			880			736			414			376

Total	$	8,436		$	6,660		$	12,552		$	16,960		$	17,350


	At or for the quarters ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2011			2011			2010			2010			2010
	(Dollars in thousands)
Nonperforming Loans
Real Estate Loans
One-to four family residential	$	28,776		$	29,062		$	27,417		$	27,505		$	30,279
Multi-family residential		6,414			8,239			10,983			12,443			8,816
Nonresidential		36,382			37,353			39,838			44,561			48,653
Land		8,316			6,722			5,188			5,943			5,943
Construction Loans
One-to four-family residential and land development		43,389			46,139			44,021			40,000			49,146
Multi-family and nonresidential		382			382			2,414			2,414			2,414

Total real estate loans		123,659			127,897			129,861			132,866			145,251
Consumer Loans		5,781			4,224			3,725			3,543			3,482
Commercial Loans		9,650			13,735			5,945			6,304			6,407

Total Loans	$	139,090		$	145,856		$	139,531		$	142,713		$	155,140


Total Nonperforming Loans and Nonperforming Assets
Past due 90 days and on nonaccrual status	$	122,856		$	112,705		$	117,499		$	126,062		$	129,534
Past due 90 days and still accruing		1,121			2,868			6,330			4,253			2,628

Past due 90 days		123,977			115,573			123,829			130,315			132,162
Past due less than 90 days and on nonaccrual		15,112			30,283			15,702			12,398			22,978

Total Nonperforming Loans		139,089			145,856			139,531			142,713			155,140
Other Real Estate Owned		43,009			42,386			39,914			39,963			41,470
Repossessed Assets		676			487			422			334			576

Total Nonperforming Assets	$	182,774		$	188,729		$	179,867		$	183,010		$	197,186


Total Troubled Debt Restructured Loans
Accruing	$	30,546		$	30,129		$	33,331		$	13,254		$	18,214
Non-accruing		28,066			24,420			11,240			14,934			10,855

Total	$	58,612		$	54,549		$	44,571		$	28,188		$	29,069