10-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM 10-K

FOR ANNUAL AND TRANSITIONAL REPORTS
PURSUANT TO SECTIONS 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

(Mark One) [X]	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended June 30, 2003
[   ]	TRANSITIONAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____________________ to _____________________

Commission File Number 0-24948

PVF Capital Corp.
(Exact Name of Registrant as Specified in Its Charter)

Ohio	34-1659805
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
30000 Aurora Road, Solon, Ohio	44139
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (440) 248-7171

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock (par value $.01 per share)
Title of Class

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  X  No      

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Yes  X  No      

Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes       No  X 

The registrant’s voting stock is listed on the NASDAQ Small Cap Market under the symbol “PVFC.” The aggregate market value of voting stock held by nonaffiliates of the registrant at September 5, 2003 was approximately $58,609,407 based on the closing sale price of the registrant’s Common Stock as listed on the Nasdaq Small-Cap MarketSM as of December 31, 2002 ($11.37 per share), as adjusted for a 10% stock dividend paid on the Common Stock on August 29, 2003. Solely for purposes of this calculation, directors, executive officers and greater than 5% stockholders are treated as affiliates.

As of September 5, 2003, the Registrant had 6,374,489 shares of common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

     1.     Portions of Annual Report to Stockholders for the Fiscal Year Ended June 30, 2003. (Parts II and IV)

     2.     Portions of Proxy Statement for the 2003 Annual Meeting of Stockholders. (Part III)

TABLE OF CONTENTS

PART I
	Item 1. Business
REGULATION OF THE BANK
REGULATION OF THE COMPANY
TAXATION
EXECUTIVE OFFICERS OF THE REGISTRANT
	Item 2. Properties
	Item 3. Legal Proceedings
	Item 4. Submission of Matters to a Vote of Security Holders
PART II
	Item 5. Market for the Registrant’s Common Equity and Related Stockholder Matters
	Item 6. Selected Financial Data
	Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
	Item 7A. Quantitative and Qualitative Disclosures About Market Risk
	Item 8. Financial Statements and Supplementary Data
	Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
	Item 9A. Controls and Procedures
PART III
	Item 10. Directors and Executive Officers of the Registrant
	Item 11. Executive Compensation
	Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
	Item 13. Certain Relationships and Related Transactions
PART IV
	Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
SIGNATURES
EX-3.3 BYLAWS
EX-10.5 2000 INCENTIVE PLAN
EX-13 PVF ANNUAL REPORT
EX-21 SUBSIDARIES OF THE REGISTRANT
EX-23.1 CONSENT OF INDEPENDENT AUDITORS
EX-23.2 CONSENT OF INDEPENDENT AUDITORS
EX-31.1 CERTIFICATION
EX-31.2 CERTIFICATION
EX-32 CERTIFICATION PURSUANT TO 18 USC SECT. 1350

PART I

Item 1. Business

General

     PVF Capital Corp. (“PVF” or the “Company”) is the holding company for Park View Federal Savings Bank (“Park View Federal” or the “Bank”). PVF owns and operates Park View Federal Savings Bank, PVF Service Corporation (“PVFSC”), a real estate subsidiary, and Mid Pines Land Company (“MPLC”), a real estate subsidiary. In addition, PVF owns PVF Holdings, Inc., a financial services subsidiary, currently inactive, and two other subsidiaries chartered for future operation, but which are also currently inactive. Park View Federal is a federal stock savings bank operating through fifteen offices located in Cleveland and surrounding communities. Park View Federal has operated continuously for 82 years, having been founded as an Ohio chartered savings and loan association in 1920. PVF Capital Corp’s main office is located at 30000 Aurora Road, Solon, Ohio 44139, and its telephone number is (440) 248-7171.

     The Bank’s principal business consists of attracting deposits from the general public and investing these funds primarily in loans secured by first mortgages on real estate located in the Bank’s market area, which consists of Portage, Lake, Geauga, Cuyahoga, Summit, Stark, Medina and Lorain Counties in Ohio. Park View Federal emphasizes the origination of loans for the purchase or construction of residential real estate, commercial real estate and multi-family residential property and land loans. To a lesser extent, the Bank originates loans secured by second mortgages, including home equity lines of credit and loans secured by savings deposits.

     The Bank derives its income principally from interest earned on loans and, to a lesser extent, loan servicing and other fees, gains on the sale of loans and mortgage-backed securities and interest earned on investments. The Bank’s principal expenses are interest expense on deposits and borrowings and noninterest expense such as compensation and employee benefits, office occupancy expenses and other miscellaneous expenses. Funds for these activities are provided principally by deposits, Federal Home Loan Bank advances, repayments of outstanding loans, sales of loans and mortgage-backed securities and operating revenues. The business of PVF consists primarily of the business of the Bank.

     Park View Federal is subject to examination and comprehensive regulation by the Office of Thrift Supervision (the “OTS”), and the Bank’s savings deposits are insured up to applicable limits by the Savings Association Insurance Fund (the “SAIF”), which is administered by the Federal Deposit Insurance Corporation (the “FDIC”). The Bank is a member of and owns capital stock in the Federal Home Loan Bank (the “FHLB”) of Cincinnati, which is one of 12 regional banks in the FHLB System. The Bank is further subject to regulations of the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”) governing reserves to be maintained and certain other matters. See “— Regulation of the Bank.”

Market Area

     The Bank conducts its business through fifteen offices located in Cuyahoga, Summit, Medina, Lorain, Lake and Geauga Counties in Ohio, and its market area consists of Portage, Lake, Geauga, Cuyahoga, Summit, Stark, Medina and Lorain Counties in Ohio. At June 30, 2003, over 90% of the Bank’s net loan portfolio and over 90% of the Bank’s deposits were in the Bank’s market area. Park View Federal has targeted business development efforts in suburban sectors of its market area, such as Lake, Geauga, Medina and Summit Counties, where demographic growth has been stronger.

     The economy in the Cleveland area historically has been based on the manufacture of durable goods. Though manufacturing continues to remain an important sector of the economy, diversification has occurred in recent years with the growth of service, financial and wholesale and retail trade industries.

2

Lending Activities

Loan Portfolio Composition and Mortgage-Backed Securities

     The Company’s loans receivable held for investment and loans receivable held for sale totaled $613.3 million at June 30, 2003, representing 82.5% of total assets at such date. It is the Company’s policy to concentrate its lending in its market area. In addition, the Company also held $3.0 million, or 0.4% of total assets, in mortgage-backed securities at June 30, 2003.

     Set forth below is certain data relating to the composition of the Company’s loan portfolio by type of loan on the dates indicated. As of June 30, 2003, the Company had no concentrations of loans exceeding 10% of total loans other than as disclosed below.

		At June 30,
		2003						2002						2001
		Amount			Percent			Amount			Percent			Amount			Percent
		(Dollars in thousands)
Real estate loans receivable held for investment:
	One-to-four family residential		143,882			24.82	%	$	158,834			28.18	%	$	207,346			36.15	%
	Home equity line of credit		67,822			11.70			53,349			9.47			37,597			6.55
	Multifamily residential		40,997			7.07			43,452			7.71			43,772			7.63
	Commercial		147,561			25.46			133,146			23.63			125,769			21.92
	Commercial equity line of credit		34,081			5.88			22,872			4.06			15,232			2.66
	Land		62,933			10.86			60,125			10.67			58,833			10.26
	Construction - residential		111,389			19.22			110,596			19.62			106,275			18.53
	Construction - multi-family		304			0.05			1,085			0.19			306			0.05
	Construction - commercial		22,936			3.96			33,451			5.94			28,962			5.05
Non real estate			11,761			2.03			8,459			1.50			5,773			1.00
			643,666			111.04			625,369			110.97			629,866			109.80
	Accrued interest receivable		2,686			0.46			2,974			0.53			3,415			0.60
	Deferred loan fees		(3,033	)		(0.52	)		(2,790	)		(0.50	)		(2,318	)		(0.40	)
	Unearned discount		(2	)		0.00			(3	)		0.00			(4	)		0.00
	Undisbursed portion of loan proceeds		(59,763	)		(10.31	)		(58,098	)		(10.30	)		(53,795	)		(9.39	)
	Market valuation reserve		0			0.00			0			0.00			0			0.00
	Allowance for loan losses		(3,883	)		(0.67	)		(3,902	)		(0.69	)		(3,520	)		(0.61	)
	Total other items		(63,995	)		(11.04	)		(61,819	)		(10.97	)		(56,222	)		(9.80	)
Total loans receivable held for investment		$	579,671			100.00	%	$	563,551			100.00	%	$	573,643			100.00	%
Real estate loans receivable held for sale:
Single-family residential held for sale		$	33,604					$	11,680					$	6,152
Mortgage-backed securities held to maturity			2,931						7,211						17,912
Accrued interest receivable			34						86						212
Total mortgage-backed securities		$	2,965					$	7,297					$	18,124

[Additional columns below]

[Continued from above table, first column(s) repeated]

		At June 30,
		2000						1999
		Amount			Percent			Amount			Percent
		(Dollars in thousands)
Real estate loans receivable held for investment:
	One-to-four family residential	$	197,445			38.45	%	$	139,536			35.28	%
	Home equity line of credit		30,978			6.03			22,956			5.80
	Multifamily residential		42,503			8.27			34,075			8.61
	Commercial		115,226			22.43			105,427			26.65
	Commercial equity line of credit		12,079			2.35			4,713			1.19
	Land		41,583			8.10			42,003			10.62
	Construction - residential		106,706			20.77			82,475			20.85
	Construction - multi-family		0			0.00			1,763			0.45
	Construction - commercial		21,604			4.21			16,694			4.25
Non real estate			4,391			0.85			3,086			0.78
			572,516			111.46			452,828			114.48
	Accrued interest receivable		3,020			0.59			2,191			0.55
	Deferred loan fees		(2,130	)		(0.41	)		(1,951	)		(0.49	)
	Unearned discount		(16	)		0.00			(23	)		(0.01	)
	Undisbursed portion of loan proceeds		(56,288	)		(10.98	)		(54,864	)		(13.87	)
	Market valuation reserve		(45	)		(0.01	)		0			0.00
	Allowance for loan losses		(3,387	)		(0.65	)		(2,630	)		(0.66	)
	Total other items		(58,846	)		(11.46	)		(57,277	)		(14.48	)
Total loans receivable held for investment		$	513,670			100.00	%	$	395,551			100.00	%
Real estate loans receivable held for sale:
Single-family residential held for sale		$	10,738					$	1,772
Mortgage-backed securities held to maturity			1,208						1,722
Accrued interest receivable			7						11
Total mortgage-backed securities		$	1,215					$	1,733

3

     The following table presents at June 30, 2003 the amounts of loan principal repayments scheduled to be received by the Company during the periods shown based upon the time remaining before contractual maturity. Loans with adjustable rates are reported as due in the year in which they reprice. Demand loans, loans having no schedule of repayments and no stated maturity and overdrafts are reported as due in one year or less. The table below does not include any estimate of prepayments which significantly shorten the average life of all mortgage loans and may cause the Bank’s actual repayment experience to differ from that shown below.

		Due
		During		Due One		Due
		the Year		Through Five		Five Years
		Ending		Years After		or More After
		June 30,		June 30,		June 30,
		2004		2003		2003
				(In thousands)
Real estate mortgage loans		$	284,442	$	197,812	$	44,767
Real estate construction loans			74,866		0		0
Non real estate loans			9,749		793		845
	Total	$	369,057	$	198,605	$	45,612

     The following table apportions the dollar amount of the loans outstanding at June 30, 2003 that are due or repricing after June 30, 2004 between those with predetermined interest rates and those with adjustable interest rates.

				Floating or
		Predetermined Rates		Adjustable Rates		Total
				(In thousands)
Real estate mortgage loans (1)		$	28,272	$	214,307	$	242,579
Non real estate loans			1,638		0		1,638
	Total	$	29,910	$	214,307	$	244,217

      (1) Includes real estate mortgage loans and construction loans

     Scheduled contractual principal repayments of loans and mortgage-backed securities do not reflect the actual life of such assets. The average life of loans and mortgage-backed securities may be substantially less than their contractual terms because of prepayments. In addition, due-on-sale clauses on loans generally give the Bank the right to declare a conventional loan immediately due and payable in the event, among other things, that the borrower sells the real property subject to the mortgage and the loan is not repaid. The average life of mortgage loans tends to increase, however, when current mortgage loan rates are substantially higher than rates on existing mortgage loans and, conversely, decreases when rates on existing mortgages are substantially higher than current mortgage loan rates.

Origination, Purchase and Sale of Loans

     The Bank generally has authority to originate and purchase loans secured by real estate located throughout the United States. Consistent with its emphasis on being a community-oriented financial institution, the Bank concentrates its lending activities in its market area.

     The Bank originates all fixed-rate, single-family mortgage loans in conformity with the Federal Home Loan Mortgage Corporation (the “FHLMC”) and Federal National Mortgage Association (the “FNMA”) guidelines so as to permit their being swapped with the FHLMC or the FNMA in exchange for mortgage-backed securities secured by such loans or their sale in the secondary market. All such loans are sold or swapped, as the case may be, with servicing retained, and are sold in furtherance of the Bank’s goal of better matching the maturities and interest rate sensitivity of its assets and liabilities. The Bank generally retains responsibility for collecting and remitting loan payments, inspecting the properties, making certain insurance and tax payments on behalf of borrowers and otherwise servicing the loans it sells or converts into mortgage-backed securities, and receives a fee for performing these services. Sales of loans also provide funds for additional lending and other purposes.

4

     The following table shows total loan origination and sale activity during the periods indicated.

			Year Ended June 30,
			2003		2002		2001
			(In thousands)
Loans originated:
Real estate:
	Residential and commercial (1)		$	491,336	$	284,991	$	156,913
	Construction (1)			123,414		125,461		130,227
	Land			30,339		24,821		38,448
Non real estate				1,106		1,826		2,193
		Total loans originated	$	646,195	$	437,099	$	327,781
Loans refinanced			$	27,335	$	36,691	$	22,952
Loans sold			$	453,736	$	295,706	$	106,048

      (1) Includes single-family and multi-family residential and commercial loans.

Loan Underwriting Policies

     The Bank’s lending activities are subject to the Bank’s written, nondiscriminatory underwriting standards and to loan origination procedures prescribed by the Bank’s Board of Directors and its management. Detailed loan applications are obtained to determine the borrower’s ability to repay, and the more significant items on these applications are verified through the use of credit reports, financial statements and confirmations. Property valuations are generally performed by an internal staff appraiser or by independent outside appraisers approved by the Bank’s Board of Directors. The Bank’s Loan Underwriter has authority to approve all fixed-rate single-family residential mortgage loans which meet FHLMC and FNMA underwriting guidelines and those adjustable-rate single-family residential mortgage loans which meet the Bank’s underwriting standards and are in amounts of less than $400,000. The Board of Directors has established a Loan Committee comprised of the Chairman of the Board and other officers and management of the Bank. This committee reviews all loans approved by the underwriter and has the authority to approve single-family residential loans up to $750,000, construction, multi-family and commercial real estate loans up to $1.0 million, and line of credit and commercial non-real estate loans up to $500,000. All loans in excess of the above amounts must be approved by the Board of Directors. All loans secured by savings deposits can be approved by lending officers based in the Bank’s branch offices.

     It is the Bank’s policy to have a mortgage creating a valid lien on real estate and to generally obtain a title insurance policy which insures that the property is free of prior encumbrances. When a title insurance policy is not obtained, a lien verification is received. Borrowers must also obtain hazard insurance policies prior to closing and, when the property is in a flood plain as designated by the Department of Housing and Urban Development, paid flood insurance policies. Most borrowers are also required to advance funds on a monthly basis together with each payment of principal and interest to a mortgage escrow account from which the Bank makes disbursements for items such as real estate taxes and homeowners insurance.

     The Bank is permitted to lend up to 100% of the appraised value of the real property securing a mortgage loan. However, if the amount of a residential loan originated or refinanced exceeds 90% of the appraised value, the Bank is required by federal regulations to obtain private mortgage insurance on that portion of the principal amount of the loan that exceeds 80% of the appraised value of the property. The Bank will make a single-family residential mortgage loan with up to a 100% loan-to-value ratio if the required private mortgage insurance is obtained. The Bank generally limits the loan-to-value ratio on multi-family loans to 80% and commercial real estate mortgages to 80%.

     Interest rates charged by the Bank on loans are affected principally by competitive factors, the demand for such loans and the supply of funds available for lending purposes and, in the case of fixed-rate single-family residential loans, rates established by the FHLMC and the FNMA. These factors are, in turn, affected by general economic conditions, monetary policies of the federal government, including the Federal Reserve Board, legislative tax policies and government budgetary matters.

5

     Residential Real Estate Lending. The Bank historically has been and continues to be an originator of single-family residential real estate loans in its market area. The Bank currently originates fixed-rate residential mortgage loans in accordance with underwriting guidelines promulgated by the FHLMC and the FNMA and adjustable-rate mortgage loans for terms of up to 30 years. In addition, in accordance with FHLMC and FNMA guidelines, the Bank offers 30-year loans with interest rates that reset after five or seven years to a rate which is 0.5% above the FHLMC 60 day delivery rate, at which point the rate is fixed over the remaining 25 or 23 years of the loan, respectively. At June 30, 2003, $143.9 million, or 24.8%, of the Bank’s net loan portfolio held for investment consisted of single-family conventional mortgage loans, of which approximately $126.5 million, or 87.9%, carried adjustable interest rates. Included in this amount are $26.8 million in second mortgage loans. In addition, the Bank had $33.6 million in loans available for sale. These loans carry fixed rates and are loans originated by the Bank to be swapped with the FHLMC and the FNMA in exchange for mortgage-backed securities or sold for cash in the secondary market.

     The Bank offers adjustable-rate residential mortgage loans with interest rates which adjust based upon changes in an index based on the weekly average yield on United States Treasury securities adjusted to a constant maturity of one year, as made available by the Federal Reserve Board (the “Treasury Rate”), plus a margin of 2.50% to 3.50%. The amount of any increase or decrease in the interest rate is usually limited to 2% per year, with a limit of 6% over the life of the loan. The date of the first rate adjustment may range from one to five years from the original date of the loan.

     Commercial and Multi-Family Residential Real Estate Lending. The commercial real estate loans originated by the Bank are primarily secured by office buildings, shopping centers, warehouses and other income producing commercial property. The Bank’s multi-family residential loans are primarily secured by apartment buildings. These loans are generally for a term of from 10 to 25 years with interest rates that adjust either annually or every three to five years based upon changes in the Treasury Rate Index or Federal Home Loan Bank advance rate, plus a negotiated margin of between 2.5% and 3.5%. In addition, the Bank makes revolving line of credit loans secured by mortgages on commercial and multi-family property. Said loans are adjustable rate loans based on the prime interest rate and are made for terms of up to two years. These loans are underwritten using the same guidelines as for first mortgage, commercial and multi-family loans. Commercial real estate loans, including commercial equity lines of credit, and multi-family residential real estate loans amounted to $222.6 million, or 38.4%, of the Bank’s net loan portfolio held for term investment at June 30, 2003.

     Commercial real estate lending entails significant additional risks as compared with residential property lending. Commercial real estate loans typically involve large loan balances to single borrowers or groups of related borrowers. The payment experience on such loans typically is dependent on the successful operation of the real estate project. These risks can be significantly impacted by supply and demand conditions in the market for office and retail space, and, as such, may be subject to a greater extent to adverse conditions in the economy. To minimize these risks, Park View Federal generally limits itself to its market area and to borrowers with which it has substantial experience or who are otherwise well known to the Bank. The Bank obtains financial statements and, in most cases, the personal guarantees from all principals obtaining commercial real estate loans.

     Construction Loans. The Bank also offers residential and commercial construction loans, with a substantial portion of such loans originated to date being for the construction of owner-occupied single-family dwellings in the Bank’s market area. Residential construction loans are offered to selected local developers to build single-family dwellings and to individuals building their primary or secondary residence. Generally, loans for the construction of owner-occupied, single-family residential properties are originated in connection with the permanent loan on the property and have a construction term of six to 18 months. Interest rates on residential construction loans made to the eventual occupant are set at competitive rates, and are usually fixed for the construction term. Interest rates on residential construction loans to builders are set at a variable rate based on the prime rate, and adjust quarterly. Interest rates on commercial construction loans float with a specified index, with construction terms generally not exceeding 18 months. Advances are generally paid directly to subcontractor’s and suppliers and are made on a percentage of completion basis. At June 30, 2003, $134.6 million, or 23.2%, of the Bank’s net loan portfolio held for investment consisted of construction loans.

6

     Prior to making a commitment to fund a loan, the Bank requires an appraisal of the property by an appraiser approved by the Board of Directors. The Bank also reviews and inspects each project at the commencement of construction and prior to disbursement of funds during the term of the construction loan.

     Construction financing is generally considered to involve a higher degree of risk of loss than long-term financing on improved, occupied real estate. Risk of loss on a construction loan is dependent largely upon the accuracy of the initial estimate of the property’s value at completion of construction or development and the estimated cost (including interest) of construction. During the construction phase, a number of factors could result in delays and cost overruns. If the estimate of construction costs proves to be inaccurate, the Bank may be required to advance funds beyond the amount originally committed to permit completion of the development. If the estimate of value proves to be inaccurate, the Bank may be confronted, at or prior to the maturity of the loan, with a project having a value which is insufficient to assure full repayment.

     Land Loans. The Bank originates loans to builders and developers for the acquisition and/or development of vacant land. The proceeds of the loan are used to acquire the land and/or to make site improvements necessary to develop the land into saleable lots. The Bank will not originate land loans to borrowers wishing to speculate in the value of land, and limits such loans to borrowers who expect to begin development of the property within two years of the date of the loan. The term of the loans are generally limited to two years. Repayments are made on the loans as the developed lots are sold.

     Land development and acquisition loans involve significant additional risks when compared with loans on existing residential properties. These loans typically involve large loan balances to single borrowers, and the payment experience is dependent on the successful development of the land and the sale of the lots. These risks can be significantly impacted by supply and demand conditions. To minimize these risks, Park View Federal generally limits the loans to builders and developers with whom it has substantial experience or who are otherwise well known to the Bank, and it obtains the financial statements and personal guarantees of such builders and developers. The Bank also requires feasibility studies and market analyses to be performed with respect to the project. The amount of the loan is limited to 80% of the appraised value. If land is being acquired, the amount of the loan to be used for such purposes is usually limited to 75% of the cost of the land. All of these loans originated are within the Bank’s market area. The Bank had $62.9 million, or 10.9% of its net loan portfolio held for investment, in land loans at June 30, 2003.

     Equity Line of Credit Loans. The Bank originates loans secured by mortgages on residential real estate. Such loans are for terms of 5 years with one 5-year review and renewal option followed by a balloon payment. The rate adjusts monthly to a rate ranging from the prime lending rate to prime plus 2.0%. At June 30, 2003, the Bank had $67.8 million, or 11.7% of its net loan portfolio held for investment in home equity lines of credit.

     Commercial Non Real Estate Business Loans. The Bank will make commercial business loans secured by non-real estate assets such as accounts receivables, inventory, furniture and fixtures, equipment and certain intangible assets. Such loans are made on a limited basis (up to 5% of assets) to credit worthy customers of the Bank. The loans are made for up to 75% of the collateral value not to exceed $3.0 million for terms up to 10 years. The Bank requires the personal guarantee of all borrowers for such loans. At June 30, 2003, the Bank had $11.8 million, or 2.0% of its net loan portfolio held for investment in commercial non real estate business loans.

Mortgage Banking Activity

     In addition to interest earned on loans, Park View Federal receives fees for servicing loans which it had sold or swapped for mortgage-backed securities. During the year ended June 30, 2003, the Bank reported a net loan servicing loss of $1.8 million as the result of high prepayment speeds on loans serviced, and at June 30, 2003 was servicing $659.0 million of loans for others. The Bank has been able to keep delinquencies on loans serviced for others to a relatively low level of below 1% of the aggregate outstanding balance of loans serviced as a result of its policy to limit servicing to loans it originated and subsequently sold to the FHLMC and the FNMA. Because of the success the Bank has experienced in this area and because it has data processing equipment that will allow it to expand its portfolio of serviced loans without incurring significant incremental expenses, the Bank intends in the future to augment its portfolio of loans serviced by continuing to originate and either swap such fixed-rate, single-family residential mortgage loans with the FHLMC and the FNMA in exchange for mortgage-backed securities or sell such loans for cash, while retaining servicing.

7

     In addition to loan servicing fees, the Bank receives fees in connection with loan commitments and originations, loan modifications, late payments and changes of property ownership and for miscellaneous services related to its loans. Loan origination fees are calculated as a percentage of the amount loaned. The Bank typically receives fees of up to three points (one point being equivalent to 1% of the principal amount of the loan) in connection with the origination of fixed-rate and adjustable-rate residential mortgage loans. All loan origination fees are deferred and accreted into income over the contractual life of the loan according to the interest method of recognizing income. If a loan is prepaid, refinanced or sold, all remaining deferred fees with respect to such loan are taken into income at such time.

     Income from these activities varies from period to period with the volume and type of loans originated, sold and purchased, which in turn is dependent on prevailing mortgage interest rates and their effect on the demand for loans in the Bank’s market area.

     At June 30, 2003 and June 30, 2002, the Bank had $33,604,000 and $11,680,000 of fixed-rate single-family mortgage loans available for sale.

Non-Performing Loans and Other Problem Assets

     It is management’s policy to continually monitor its loan portfolio to anticipate and address potential and actual delinquencies. When a borrower fails to make a payment on a loan, the Bank takes immediate steps to have the delinquency cured and the loan restored to current status. Loans which are delinquent 15 days incur a late fee of 5% of the scheduled principal and interest payment. As a matter of policy, the Bank will contact the borrower after the loan has been delinquent 20 days. The Bank orders a property inspection after a loan payment becomes 45 days past due. If a delinquency exceeds 90 days in the case of a residential mortgage loan, 60 days in the case of a construction loan or 60 days for a loan on commercial real estate, the Bank will institute additional measures to enforce its remedies resulting from the loan’s default, including, commencing foreclosure action. Loans which are delinquent 90 days or more generally are placed on nonaccrual status, and formal legal proceedings are commenced to collect amounts owed.

8

     The following table sets forth information with respect to the Bank’s nonperforming loans and other problem assets at the dates indicated.

			At June 30,
			2003			2002			2001			2000			1999
						(Dollars in thousands)
Non-accruing loans (1):
Real estate			$	7,437		$	7,805		$	5,385		$	4,842		$	3,639
		Total	$	7,437		$	7,805		$	5,385		$	4,842		$	3,639
Accruing loans which are contractually past due 90 days or more:
	Real estate		$	275		$	0		$	20		$	935		$	248
		Total	$	275		$	0		$	20		$	935		$	248
	Total nonaccrual and 90 days past due loans		$	7,712		$	7,805		$	5,405		$	5,777		$	3,887
Ratio of non-performing loans to total loans and mortgage-backed securities				1.26	%		1.36	%		0.90	%		1.10	%		.97	%
Other non-performing assets (2)			$	449		$	564		$	547		$	488		$	168
Total non-performing assets			$	8,161		$	8,369		$	5,952		$	6,265		$	4,055
Total non-performing assets to total assets				1.10	%		1.23	%		0.81	%		1.02	%		0.90	%

(1)

Non-accrual status denotes loans on which, in the opinion of management, the collection of additional interest is unlikely, or loans that meet the non-accrual criteria established by regulatory authorities. Non-accrual loans include all loans classified as doubtful or loss, loans in foreclosure, and all loans greater than 90-days past due with a loan-to-value ratio greater than 65%. Payments received on a non-accrual loan are either applied to the outstanding principal balance or recorded as interest income, depending on an assessment of the collectibility of the principal balance of the loan.

(2)

Other non-performing assets represent property acquired by the Bank through foreclosure or repossession.

     It is the Bank’s policy to not record into income partial interest payments. During the year ended June 30, 2003, gross interest income of $761,800 would have been recorded on loans accounted for on a non-accrual basis if such loans had been current throughout the period. No interest was included in income on non-accruing loans.

     At June 30, 2003, non-accruing loans consisted of 38 loans totaling $7.4 million, and included 22 conventional mortgage loans aggregating $3.0 million, 2 land loans in the amount of $0.9 million, 3 construction loans in the amount of $0.5 million, 9 commercial loans in the amount of $2.9 million and 2 multi-family loans in the amount of $0.1 million. Management has reviewed its non-accruing loans and believes that the allowance for loan losses is adequate to absorb probable losses on these loans.

     Real estate acquired by the Bank as a result of foreclosure is classified as real estate owned until such time as it is sold. At June 30, 2003, the Bank had one commercial real estate owned property totaling $449,000.

     Asset Classification and Allowance for Loan Losses. Federal regulations require savings institutions to review their assets on a regular basis and to classify them as “substandard,” “doubtful” or “loss,” if warranted. Assets classified as substandard or doubtful require the institution to establish general allowances for loan losses. If an asset or portion thereof is classified loss, the insured institution must either establish specific allowances for loan losses in the amount of 100% of the portion of the asset classified loss, or charge off such amount. An asset which does not currently warrant classification but which possesses weaknesses or deficiencies deserving close attention is required to be designated as “special mention.” The Bank has established an Asset Classification Committee, which is comprised of senior employees of the Bank and two outside Board members. The Asset Classification Committee meets quarterly to review the Bank’s loan portfolio and determine which loans should be placed on a “watch-list” of potential problem loans which are considered to have more than normal credit risk. Currently, general loss allowances (up to 1.25% of risk-based assets) established to cover losses related to assets classified substandard or doubtful may be included in determining an institution’s regulatory capital, while specific valuation allowances for loan losses do not qualify as

9

regulatory capital. See “Regulation of the Bank — Regulatory Capital Requirements.” OTS examiners may disagree with the insured institution’s classifications and amounts reserved. If an institution does not agree with an examiner’s classification of an asset, it may appeal this determination to the OTS. At June 30, 2003, total non-accrual and 90 days past due loans and other non-performing assets were $8.2 million, of which amount approximately $7.4 million were classified as substandard. For additional information, see “— Non-Performing Loans and Other Problem Assets” and Note 4 of Notes to Consolidated Financial Statements.

     In originating loans, the Bank recognizes that credit losses will be experienced and that the risk of loss will vary with, among other things, the type of loan being made, the creditworthiness of the borrower over the term of the loan, general economic conditions and, in the case of a secured loan, the quality of the security for the loan. It is management’s policy to maintain an adequate allowance for loan losses based on, among other things, the Bank’s and the industry’s historical loan loss experience, evaluation of economic conditions and regular reviews of delinquencies and loan portfolio quality. The Bank increases its allowance for loan losses by charging provisions for loan losses against the Bank’s income.

     General allowances are made pursuant to management’s assessment of risk in the Bank’s loan portfolio as a whole. Specific allowances are provided for individual loans when ultimate collection is considered questionable by management after reviewing the current status of loans which are contractually past due and considering the net realizable value of the security for the loan. Management continues to actively monitor the Bank’s asset quality and to charge off loans against the allowance for loan losses when appropriate or to provide specific loss reserves when necessary. Although management believes it uses the best information available to make determinations with respect to the allowance for loan losses, future adjustments may be necessary if economic conditions differ substantially from the economic conditions in the assumptions used in making the initial determinations.

     The following table summarizes the activity in the allowance for loan losses for the periods indicated.

			Year Ended June 30,
			2003			2002			2001			2000			1999
						(Dollars in thousands)
Balance at beginning of year			$	3,902		$	3,520		$	3,388		$	2,630		$	2,687
Charge-offs:
	Mortgage loans			19			204			106			93			42
	Non real estate (1)			0			2			7			0			20
		Total charge-offs		19			206			113			93			62
Recoveries:
	Mortgage loans			0			30			20			1			5
	Non real estate (1)			0			0			0			0			0
		Total recoveries		0			30			20			1			5
Net charge-offs				19			176			93			92			57
Provision charged to income				0			558			225			850			0
Balance at end of year			$	3,883		$	3,902		$	3,520		$	3,388		$	2,630
Ratio of net charge-offs during the year to average loans outstanding during the year				0.0	%		0.0	%		0.0	%		0.0	%		0.0	%

(1) Consists primarily of line of credit loans.

10

     The following table sets forth the breakdown of the allowance for loan losses by loan category at the dates indicated. The allocation of the allowance to each category is not necessarily indicative of future losses and does not restrict the use of the allowance to absorb losses in any category.

			At June 30,
			2003					2002					2001
					% of					% of					% of
					Loans in					Loans in					Loans in
					Category to					Category to					Category to
					Total					Total					Total
					Net Loans					Net Loans					Net Loans
			Amount		Outstanding			Amount		Outstanding			Amount		Outstanding
			(Dollars in thousands)
Mortgage Loans:
	One-to-four family residential (1)		$	1,335		46.60	%	$	1,005		49.95	%	$	841		54.03	%
	Multi-family residential			269		7.10			261		7.66			233		7.58
	Commercial			1,949		33.41			2,187		30.46			1,934		27.24
	Land			294		10.86			366		10.45			307		10.15
	Unallocated			19		0.00			0		0.00			130		0.00
		Total mortgage loans		3,866		97.97			3,819		98.52			3,445		99.00
Non real estate				17		2.03			83		1.48			75		1.00
	Total allowance for loan losses		$	3,883		100.00	%	$	3,902		100.00	%	$	3,520		100.00	%

[Additional columns below]

[Continued from above table, first column(s) repeated]

			At June 30,
			2000					1999
					% of					% of
					Loans in					Loans in
					Category to					Category to
					Total					Total
					Net Loans					Net Loans
			Amount		Outstanding			Amount		Outstanding
			(Dollars in thousands)
Mortgage Loans:
	One-to-four family residential (1)		$	885		56.62	%	$	727		50.33	%
	Multi-family residential			234		8.11			201		8.58
	Commercial			1,596		26.51			1,438		29.74
	Land			261		7.93			218		10.57
	Unallocated			349		0.00			0		0.00
		Total mortgage loans		3,325		99.17			2,584		99.22
Non real estate				63		0.83			46		0.78
	Total allowance for loan losses		$	3,388		100.00	%	$	2,630		100.00	%

(1) Consists of one-to-four family residential and home equity line of credit.

11

Investment Activities

     Park View Federal’s investment policy currently allows for investment in various types of liquid assets, including United States Government and Agency securities, time deposits at the FHLB of Cincinnati, certificates of deposit or bankers’ acceptances at other federally insured depository institutions and mortgage-backed securities. The general objective of Park View Federal’s investment policy is to maximize returns without compromising liquidity or creating undue credit or interest rate risk. In accordance with the investment policy, at June 30, 2003 Park View Federal had investments in agency notes, federal funds sold, FHLB of Cincinnati stock and interest-bearing deposits in other financial institutions.

     The Bank reports its investments, other than marketable equity securities and securities available for sale, at cost as adjusted for discounts and unamortized premiums. The Bank has the intent and ability and generally holds all securities until maturity. Any FHLMC mortgage-backed securities created from loans originated by the Bank for sale will be designated available for sale. For additional information see Notes 2 of Notes to Consolidated Financial Statements.

     At present, management is not aware of any conditions or circumstances which could impair its ability to hold its remaining securities to maturity.

     The following table sets forth the carrying value of the Bank’s securities portfolio, short-term investments and FHLB of Cincinnati stock at the dates indicated. At June 30, 2003, the fair market values of the Bank’s securities portfolio was $0.03 million. All securities are held to maturity, but are callable prior to maturity.

		At June 30,
		2003		2002		2001
		(In thousands)
Investment securities:
Municipal securities		$	33	$	121	$	212
U.S. Government and agency securities			0		55,000		50,000
	Total securities		33		55,121		50,212
Interest-bearing deposits			3,946		1,737		1,200
Federal funds sold			83,050		8,050		56,050
FHLB of Cincinnati stock			10,396		9,948		9,442
	Total investments	$	97,425	$	74,856	$	116,904

12

     The following table sets forth the scheduled maturities, carrying values, market values and average yields for the Bank’s securities at June 30, 2003.

		At June 30, 2003
		One Year					One to Five					Five to 10
		or Less					Years					Years
		Carrying		Average			Carrying		Average			Carrying		Average
		Value		Yield			Value		Yield			Value		Yield
		(Dollars in thousands)
Municipal securities		$	33		6.25	%	$	0		0.00	%	$	0		0.00	%
U.S. Government and agency securities			0		0.00			0		0.00			0		0.00
Deposits (1)			86,996		1.00			0		0.00			0		0.00
FHLB of Cincinnati stock			0		0.00			0		0.00			0		0.00
	Total	$	87,029		1.00		$	0		0.00		$	0		0.00

[Additional columns below]

[Continued from above table, first column(s) repeated]

		At June 30, 2003
		More than
		10 Years					Total Securities
		Carrying		Average			Carrying		Market		Average
		Value		Yield			Value		Value		Yield
		(Dollars in thousands)
Municipal securities		$	0		0.00	%	$	33	$	33		6.25	%
U.S. Government and agency securities			0		0.00			0		0		0.00
Deposits (1)			0		0.00			86,996		86,996		1.00
FHLB of Cincinnati stock			10,396		4.00			10,396		10,396		4.00
	Total	$	10,396		4.00		$	97,425	$	97,425		1.32

(1) Includes interest-bearing deposits at other financial institutions and federal funds sold.

13

Deposit Activity and Other Sources of Funds

     General. Deposits are the primary source of the Bank’s funds for lending, investment activities and general operational purposes. In addition to deposits, Park View Federal derives funds from loan principal and interest repayments, maturities of securities and interest payments thereon. Although loan repayments are a relatively stable source of funds, deposit inflows and outflows are significantly influenced by general interest rates and money market conditions. Borrowings may be used on a short-term basis to compensate for reductions in the availability of funds, or on a longer term basis for general operational purposes.

     Deposits. The Bank attracts deposits principally from within its primary market area by offering a variety of deposit instruments, including checking accounts, money market accounts, regular savings accounts and certificates of deposit which range in maturity from seven days to four years. Deposit terms vary according to the minimum balance required, the length of time the funds must remain on deposit and the interest rate. Maturities, terms, service fees and withdrawal penalties for its deposit accounts are established by the Bank on a periodic basis. Park View Federal generally reviews its deposit mix and pricing on a weekly basis. In determining the characteristics of its deposit accounts, Park View Federal considers the rates offered by competing institutions, funds acquisition and liquidity requirements, growth goals and federal regulations. The Bank does not accept brokered deposits due to the volatility and rate sensitivity of such deposits.

     Park View Federal competes for deposits with other institutions in its market area by offering deposit instruments that are competitively priced and providing customer service through convenient and attractive offices, knowledgeable and efficient staff and hours of service that meet customers’ needs. To provide additional convenience, Park View Federal participates in MAC (money access card) Automated Teller Machine networks at locations throughout Ohio and other participating states, through which customers can gain access to their accounts at any time.

     The Bank’s deposits increased by $46.7 million for the fiscal year ended June 30, 2003 as compared to the fiscal year ended June 30, 2002, Deposit balances totaled $526.4 million, $479.7 million and $480.5 million at the fiscal years ended June 30, 2003, 2002, and 2001, respectively.

     Deposits in the Bank as of June 30, 2003 were represented by the various programs described below.

Weighted
Average						Percentage
Interest		Minimum		Balance in		of Total
Rate	Category	Balance		Thousands		Deposits
0.34%	NOW accounts	$	50	$	38,875		7.38	%
1.00	Passbook statement accounts		5		43,192		8.20
0.67	Money market accounts		1,000		27,514		5.23
0.00	Non-interest-earning demand accounts		50		14,682		2.79
					124,263		23.60
	Certificates of Deposit
2.98	3 months or less		500		120,841		22.95
2.22	3 - 6 months		500		36,031		6.84
2.85	6 - 12 months		500		92,444		17.56
3.76	1 - 3 years		500		129,493		24.60
4.65	More than three years		500		23,357		4.45
3.23	Total certificates of deposit				402,166		76.40
2.61	Total deposits			$	526,429		100.00	%

14

     The following table sets forth the change in dollar amount of deposits in the various types of accounts offered by the Bank between the dates indicated.

		At June 30, 2003							At June 30, 2002								At June 30, 2001
							Increase							Increase
							(Decrease)							(Decrease)
				% of			From Prior				% of			From Prior					% of
		Balance		Deposits			Year		Balance		Deposits			Year			Balance		Deposits
									(Dollars in thousands)
NOW checking (1)		$	53,557		10.17	%	$	4,576	$	48,981		10.21	%	$	8,880		$	40,101		8.35	%
Super NOW checking and money market			27,514		5.23			5,589		21,925		4.57			8,927			12,998		2.70
Passbook and regular savings			43,192		8.20			6,026		37,166		7.75			5,921			31,245		6.50
Jumbo certificates			100,149		19.02			3,138		97,011		20.23			(13,550	)		110,561		23.01
Other certificates			255,908		48.61			24,381		231,527		48.27			(11,321			242,848		50.54
Keogh accounts			531		0.10			126		405		0.08			113			292		0.06
IRA accounts			45,578		8.67			2,921		42,657		8.89			170			42,487		8.84
	Total	$	526,429		100.00	%	$	46,757	$	479,672		100.00	%	$	(860	)	$	480,532		100.00	%

(1) Includes non-interest-bearing demand accounts.

     The following table sets forth the average balances and average interest rates based on month-end balances for interest-bearing demand deposits and time deposits during the periods indicated.

	For the Year Ended June 30,
	2003									2002
	Interest-									Interest-
	Bearing									Bearing
	Demand			Savings			Time			Demand			Savings			Time
	Deposits			Deposits			Deposits			Deposits			Deposits			Deposits
	(Dollars in thousands)
Average balance	$	66,640		$	38,799		$	380,784		$	49,981		$	35,048		$	376,795
Average rate paid		1.35	%		1.21	%		3 .62	%		2.16	%		1.88	%		5.11	%

[Additional columns below]

[Continued from above table, first column(s) repeated]

	For the Year Ended June 30,
	2001
	Interest-
	Bearing
	Demand			Savings			Time
	Deposits			Deposits			Deposits
	(Dollars in thousands)
Average balance	$	40,034		$	30,893		$	399,039
Average rate paid		3.23	%		2.50	%		6.27	%

15

     The rates currently paid on certificates maturing within one year or less are lower than the rates currently being paid on similar certificates of deposit maturing thereafter. The Bank will seek to retain these deposits to the extent consistent with its long-term objective of maintaining positive interest rate spreads. Depending upon interest rates existing at the time such certificates mature, the Bank’s cost of funds may be significantly affected by the rollover of these funds. A decrease in such cost of funds, if any, may have a material impact on the Bank’s operations. To the extent such deposits do not rollover, the Bank may, if necessary, use other sources of funds, including borrowings from the FHLB of Cincinnati, to replace such deposits. See “— Borrowings.”

     The following table indicates the amount of the Bank’s certificates of deposit of $100,000 or more by time remaining until maturity as of June 30, 2003.

		Certificates
Maturity Period		of Deposit
		(In thousands)
Three months or less		$	36,534
Three through six months			8,662
Six through 12 months			24,711
Over 12 months			39,986
	Total	$	109,893

     Borrowings. Savings deposits historically have been the primary source of funds for the Bank’s lending, investments and general operating activities. The Bank is authorized, however, to use advances from the FHLB of Cincinnati to supplement its supply of lendable funds and to meet deposit withdrawal requirements. The FHLB of Cincinnati functions as a central reserve bank providing credit for savings institutions and certain other member financial institutions. As a member of the FHLB System, Park View Federal is required to own stock in the FHLB of Cincinnati and is authorized to apply for advances. Advances are pursuant to several different programs, each of which has its own interest rate and range of maturities. Park View Federal has a Blanket Agreement for advances with the FHLB under which the Bank may borrow up to 50% of assets subject to normal collateral and underwriting requirements. The Bank currently has two commitments with the Federal Home Loan Bank of Cincinnati for flexible lines of credit, referred to as a cash management advance and a REPO advance, in the amounts of $30 million and $100 million respectively. The REPO advance and the CMA were not drawn down at June 30, 2003. Advances from the FHLB of Cincinnati are secured by the Bank’s stock in the FHLB of Cincinnati and other eligible assets. For additional information please refer to Note 8 of Notes to Consolidated Financial Statements.

     The following table sets forth certain information regarding the Bank’s advances from the FHLB of Cincinnati for the periods indicated:

	At June 30,
	2003			2002			2001
	(In thousands)
Amounts outstanding at end of period	$	120,123		$	120,740		$	185,867
Weighted average rate		4.30	%		4.30	%		4.68	%
Maximum amount outstanding at any month end	$	130,725		$	172,839		$	185,872
Approximate average outstanding balance		122,034			142,820			117,624
Weighted average rate		4.27	%		4.08	%		5.68	%

     At June 30, 2003 PVFCC had one note payable for $5.0 million, and drawn down $2.5 million, collateralized by the stock of PVFSB. At June 30, 2003 PVFSC had one note payable with an outstanding balance of $3.3 million, collateralized by real estate. See Note 9 of Notes to Consolidated Financial Statement.

16

Subsidiary Activities

     The Bank is required to give the FDIC and the Director of OTS 30 days prior notice before establishing or acquiring a new subsidiary or commencing a new activity through an existing subsidiary. Both the FDIC and the Director of OTS have the authority to prohibit the initiation or to order the termination of subsidiary activities determined to pose a risk to the safety or soundness of the institution.

     As a federally chartered savings bank, Park View Federal is permitted to invest an amount equal to 2% of its assets in subsidiaries, with an additional investment of 1% of assets where such investment serves primarily community, inner-city and community development purposes. Under such limitations, as of June 30, 2003, ParkView Federal was authorized to invest up to approximately $22.3 million in the stock of or loans to subsidiaries, including the additional 1% investment for community inner-city and community development purposes. Institutions meeting their applicable minimum regulatory capital requirements may invest up to 50% of their regulatory capital in conforming first mortgage loans to subsidiaries in which they own 10% or more of the capital stock. Park View Federal currently exceeds its regulatory capital requirements.

     PVF has three active subsidiaries, Park View Federal, PVFSC and MPLC. PVFSC is engaged in the activities of land acquisition and real estate investment. PVF has three nonactive subsidiaries, PVF Community Development Corp., PVF Mortgage Corp., and PVF Holdings, which have been chartered for future activity.

     PVF Service Corporation. At June 30, 2003, PVFSC had a $0.35 million investment in a joint venture for the construction of a new branch office in Avon, Ohio, with the joint venture borrowing $0.7 million, guaranteed by PVFSC, for the cost of construction. PVFSC also has an interest in Park View Plaza, a joint venture, which is a strip center in Lakewood, OH that includes our Clifton branch office. In addition, PVFSC had a $5.3 million investment in office properties used by the Bank, that includes the Corporate Center in Solon, Ohio, and branch offices in Bainbridge, Ohio and Chardon, Ohio. In March 2002, PVFSC obtained a loan for $3.4 million secured by its Corporate Center in Solon, Ohio. PVFSC also made a $0.85 million real estate loan for the development of land in Newbury, Ohio.

     Mid Pines Land Company. In September of 2000, MPLC purchased a commercial office building in Solon, Ohio and approximately 5 acres of adjoining land from ARAC, Inc. for $4.4 million dollars. The purchase was made for the purpose of facilitating the acquisition in April 2001 by PVFSC of the Company’s new Corporate Center. In November of 2000, the commercial office building was sold to Rockside Corporate Woods Limited, LLC for $3.6 million. At June 30, 2003, MPLC had an investment of $0.6 million in land adjacent to the Company’s new Corporate Center in Solon, Ohio

Competition

     The Bank faces strong competition both in originating real estate and other loans and in attracting deposits. The Bank competes for real estate and other loans principally on the basis of interest rates and the loan fees it charges, the type of loans it originates and the quality of services it provides to borrowers. Its competition in originating real estate loans comes primarily from other savings institutions, commercial banks and mortgage bankers making loans secured by real estate located in the Bank’s market area.

     The Bank attracts all its deposits through its branch offices primarily from the communities in which those branch offices are located. Consequently, competition for deposits is principally from other savings institutions, commercial banks, credit unions and brokers in these communities. Park View Federal competes for deposits and loans by offering a variety of deposit accounts at competitive rates, a wide array of loan products, convenient business hours and branch locations, a commitment to outstanding customer service and a well-trained staff. In addition, the Bank believes it has developed strong relationships with local businesses, realtors, builders, and the public in general, giving it an excellent image in the community.

Employees

     As of June 30, 2003, PVF and its subsidiaries had 169 full-time employees and 27 part-time employees, none of whom was represented by a collective bargaining agreement. The Company believes it enjoys a good relationship with its personnel.

17

REGULATION OF THE BANK

     General. As a savings institution, Park View Federal is subject to extensive regulation by the OTS, and its deposits are insured by the SAIF, which is administered by the FDIC. The lending activities and other investments of the Bank must comply with various federal regulatory requirements. The OTS periodically examines the Bank for compliance with various regulatory requirements. The FDIC also has the authority to conduct special examinations of SAIF-insured savings institutions. The Bank must file reports with OTS describing its activities and financial condition. The Bank is also subject to certain reserve requirements promulgated by the Federal Reserve Board. This supervision and regulation is intended primarily for the protection of depositors. Certain of these regulatory requirements are referred to below or elsewhere herein.

     Financial Modernization Legislation. On November 12, 1999, legislation was enacted which could have a far-reaching impact on the financial services industry. The Gramm-Leach-Bliley (“G-L-B”) Act authorizes affiliations between banking, securities and insurance firms and authorizes bank holding companies and national banks to engage in a variety of new financial activities. Among the new activities that will be permitted to bank holding companies are securities and insurance brokerage, securities underwriting, insurance underwriting and merchant banking. The Federal Reserve Board, in consultation with the Secretary of the Treasury, may approve additional financial activities. The G-L-B Act, however, prohibits future acquisitions of existing unitary savings and loan holding companies, like the Company, by firms which are engaged in commercial activities and limits the permissible activities of unitary holding companies formed after May 4, 1999.

     The G-L-B Act imposes new requirements on financial institutions with respect to customer privacy. The G-L-B Act generally prohibits disclosure of customer information to non-affiliated third parties unless the customer has been given the opportunity to object and has not objected to such disclosure. Financial institutions are further required to disclose their privacy policies to customers annually. Financial institutions, however, will be required to comply with state law if it is more protective of customer privacy than the G-L-B Act. The G-L-B Act directs the federal banking agencies, the National Credit Union Administration, the Secretary of the Treasury, the Securities and Exchange Commission and the Federal Trade Commission, after consultation with the National Association of Insurance Commissioners, to promulgate implementing regulations within six months of enactment. The privacy provisions became effective in July 2001.

     The G-L-B Act contains significant revisions to the FHLB System. The G-L-B Act imposes new capital requirements on the FHLBs and authorizes them to issue two classes of stock with differing dividend rates and redemption requirements. The G-L-B Act deletes the current requirement that the FHLBs annually contribute $300 million to pay interest on certain government obligations in favor of a 20% of net earnings formula. The G-L-B Act expands the permissible uses of FHLB advances by community financial institutions (under $500 million in assets) to include funding loans to small businesses, small farms and small agri-businesses. The G-L-B Act makes membership in the FHLB voluntary for federal savings associations.

     The G-L-B Act contains a variety of other provisions including a prohibition against ATM surcharges unless the customer has first been provided notice of the imposition and amount of the fee. The G-L-B Act reduces the frequency of Community Reinvestment Act examinations for smaller institutions and imposes certain reporting requirements on depository institutions that make payments to non-governmental entities in connection with the Community Reinvestment Act. The G-L-B Act eliminates the SAIF special reserve and authorizes a federal savings association that converts to a national or state bank charter to continue to use the term “federal” in its name and to retain any interstate branches.

     The Company is unable to predict the impact of the G-L-B Act on its operations at this time. Although the G-L-B Act reduces the range of companies with which may acquire control of the Company, it may facilitate affiliations with companies in the financial services industry.

     Regulatory Capital Requirements. Under OTS regulations, savings institutions must maintain “tangible” capital equal to 1.5% of adjusted total assets, “core” (also referred to as “Tier 1”) capital equal to 4.0% (or 3.0% if the institution is rated CAMELS 1 under the OTS examination rating system) of adjusted total assets and “total capital,” a combination of core and “supplementary” capital, equal to 8.0% of “risk-weighted” assets. In addition, the OTS has

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adopted regulations which impose certain restrictions on savings associations that have a total risk-based capital ratio that is less than 8.0%, a ratio of Tier 1 capital to risk-weighted assets of less than 4.0% or a ratio of Tier 1 capital to adjusted total assets of less than 4.0% (or 3.0% if the institution is rated CAMELS 1). For purposes of these regulations, Tier 1 capital has the same definitions as core capital. See “— Prompt Corrective Regulatory Action.” The Bank is in compliance with all applicable regulatory capital requirements.

     In determining compliance with the risk-based capital requirement, a savings institution calculates its total capital, which may include both core capital and supplementary capital, provided the amount of supplementary capital used does not exceed the savings institution’s core capital. Supplementary capital is defined to include certain preferred stock issues, nonwithdrawable accounts and pledged deposits that do not qualify as core capital, certain approved subordinated debt, certain other capital instruments and a portion of the savings institution’s allowances for loan and lease losses allowances, and up to 45% of unrealized net gains on equity securities. Total core and supplementary capital are reduced by the amount of capital instruments held by other depository institutions pursuant to reciprocal arrangements and equity investments other than those deducted from core and tangible capital. At June 30, 2003, Park View Federal had no equity investments for which OTS regulations require a deduction from total capital.

     The risk-based capital requirement is measured against risk-weighted assets, which equal the sum of each asset and the credit-equivalent amount of each off-balance sheet item after being multiplied by an assigned risk weight. Under the OTS risk-weighting system, single-family first mortgages not more than 90 days past due with loan-to-value ratios under 80%, and multi-family mortgages (maximum 36 dwelling units) with loan-to-value ratios under 80% and average annual occupancy rates over 80%, are assigned a risk weight of 50%. Consumer, home equity and land loans, residential and nonresidential construction loans and commercial real estate loans are assigned a risk weight of 100%. Mortgage-backed securities issued, or fully guaranteed as to principal and interest, by the FNMA or FHLMC are assigned a 20% risk weight. Cash and United States Government securities backed by the full faith and credit of the United States Government are given a 0% risk weight. Under the risk-based capital requirement, a savings institution is required to maintain total capital, consisting of core capital plus certain other components, including general valuation allowances, equal to 8.0% of risk-weighted assets. At June 30, 2003 the Bank’s risk-weighted assets were $535.6 million, and its total regulatory capital was $61.2 million, or 11.43% of risk-weighted assets.

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     The table below presents the Bank’s capital position at June 30, 2003, relative to its various minimum regulatory capital requirements.

		At June 30, 2003
				Percent of
		Amount		Assets (1)
		(Dollars in Thousands)
Tangible Capital		$	57,548		7.73	%
Tangible Capital Requirement			11,160		1.50
	Excess	$	46,388		6.23	%
Tier 1/Core Capital		$	57,548		7.73	%
Tier 1/Core Capital Requirement			29,760		4.00
	Excess	$	27,788		3.73	%
Tier 1 Risk-Based Capital		$	57,548		10.74	%
Tier 1 Risk-Based Capital Requirement			21,425		4.00
	Excess	$	36,123		6.74	%
Risk-Based Capital		$	61,196		11.43	%
Risk-Based Capital Requirement			42,849		8.00
	Excess	$	18,347		3.43	%

(1) Based upon adjusted total assets for purposes of the tangible, core and Tier 1 capital requirements, and risk-weighted assets for purposes of the Tier 1 risk-based and risk-based capital requirements.

     In addition to requiring generally applicable capital standards for savings institutions, the Director of OTS may establish the minimum level of capital for a savings institution at such amount or at such ratio of capital-to-assets as the Director determines to be necessary or appropriate for such institution in light of the particular circumstances of the institution. The Director of OTS may treat the failure of any savings institution to maintain capital at or above such level as an unsafe or unsound practice and may issue a directive requiring any savings institution which fails to maintain capital at or above the minimum level required by the Director to submit and adhere to a plan for increasing capital. Such an order may be enforced in the same manner as an order issued by the FDIC.

     Prompt Corrective Regulatory Action. Under the Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”), the federal banking regulators are required to take prompt corrective action if an insured depository institution fails to satisfy certain minimum capital requirements. All institutions, regardless of their capital levels, are restricted from making any capital distribution or paying any management fees if the institution would thereafter fail to satisfy the minimum levels for any of its capital requirements. An institution that fails to meet the minimum level for any relevant capital measure (an “undercapitalized institution”) may be: (i) subject to increased monitoring by the appropriate federal banking regulator; (ii) required to submit an acceptable capital restoration plan within 45 days; (iii) subject to asset growth limits; and (iv) required to obtain prior regulatory approval for acquisitions, branching and new lines of businesses. The capital restoration plan must include a guarantee by the institution’s holding company that the institution will comply with the plan until it has been adequately capitalized on average for four consecutive quarters, under which the holding company would be liable up to the lesser of 5% of the institution’s total assets or the amount necessary to bring the institution into capital compliance as of the date it failed to comply with its capital restoration plan. A “significantly undercapitalized” institution, as well as any undercapitalized institution that did not submit an acceptable capital restoration plan, may be subject to regulatory demands for recapitalization, broader application of restrictions on transactions with affiliates, limitations on interest rates paid on deposits, asset growth and other activities, possible replacement of directors and officers, and restrictions on capital distributions by any bank holding company controlling the institution. Any company controlling the institution could also be required to divest the institution or the institution

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could be required to divest subsidiaries. The senior executive officers of a significantly undercapitalized institution may not receive bonuses or increases in compensation without prior approval and the institution is prohibited from making payments of principal or interest on its subordinated debt. In their discretion, the federal banking regulators may also impose the foregoing sanctions on an undercapitalized institution if the regulators determine that such actions are necessary to carry out the purposes of the prompt corrective action provisions. If an institution’s ratio of tangible capital to total assets falls below a “critical capital level,” the institution will be subject to conservatorship or receivership within specified time periods.

     Under regulations jointly adopted by the federal banking regulators, a savings institution’s capital adequacy for purposes of the FDICIA prompt corrective action rules is determined on the basis of the institution’s total risk-based capital ratio (the ratio of its total capital to risk-weighted assets), Tier 1 risk-based capital ratio (the ratio of its core capital to risk-weighted assets) and leverage ratio (the ratio of its Tier 1 or core capital to adjusted total assets). The following table shows the capital ratio requirements for each prompt corrective action category:

		Adequately		Significantly
	Well Capitalized	Capitalized	Undercapitalized	Undercapitalized
Total risk-based capital ratio	10.0% or more	8.0% or more	Less than 8.0%	Less than 6.0%
Tier 1 risk-based capital ratio	6.0% or more	4.0% or more	Less than 4.0%	Less than 3.0%
Leverage ratio	5.0% or more	4.0% or more *	Less than 4.0% *	Less than 3.0%

* 3.0% if the institution has a composite 1 CAMELS rating.

A “critically undercapitalized” savings institution is defined as a savings institution that has a ratio of “tangible equity” to total assets of less than 2.0%. Tangible equity is defined as core capital plus cumulative perpetual preferred stock (and related surplus) less all intangibles other than qualifying supervisory goodwill and certain purchased mortgage servicing rights. The OTS may reclassify a well capitalized savings association as adequately capitalized and may require an adequately capitalized or undercapitalized institution to comply with the supervisory actions applicable to institutions in the next lower capital category (but may not reclassify a significantly undercapitalized institution as critically undercapitalized) if the OTS determines, after notice and an opportunity for a hearing, that the savings institution is in an unsafe or unsound condition or that the institution has received and not corrected a less-than-satisfactory rating for any CAMELS rating category. For information regarding the position of the Bank with respect to the FDICIA prompt corrective action rules, see Note 13 of Notes to Consolidated Financial Statements.

     Safety and Soundness Standards. Interagency Guidelines Establishing Standards for Safety and Soundness require savings institutions to maintain internal controls and information systems and internal audit systems that are appropriate for the size, nature and scope of the institution’s business. The guidelines also establish certain basic standards for loan documentation, credit underwriting, interest rate risk exposure, and asset growth. The guidelines further provide that savings institutions should maintain safeguards to prevent the payment of compensation, fees and benefits that are excessive or that could lead to material financial loss, and should take into account factors such as comparable compensation practices at comparable institutions. If the OTS determines that a savings institution is not in compliance with the safety and soundness guidelines, it may require the institution to submit an acceptable plan to achieve compliance with the guidelines. A savings institution must submit an acceptable compliance plan to the OTS within 30 days of receipt of a request for such a plan. Failure to submit or implement a compliance plan may subject the institution to regulatory sanctions. Additionally, a savings institution should maintain systems, commensurate with its size and the nature and scope of its operations, to identify problem assets and prevent deterioration in those assets as well as to evaluate and monitor earnings and ensure that earnings are sufficient to maintain adequate capital and reserves. Management believes that the Bank meets substantially all the standards adopted in the interagency guidelines.

     Federal Home Loan Bank System. Park View Federal is a member of the FHLB System, which consists of 12 regional FHLBs subject to supervision and regulation by the Federal Housing Finance Board (“FHFB”). The FHLBs provide a central credit facility primarily for member institutions. As a member of the FHLB System, the Bank is

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required to acquire and hold shares of capital stock in the FHLB of Cincinnati in an amount at least equal to 1% of the aggregate unpaid principal of its home mortgage loans, home purchase contracts and similar obligations at the beginning of each year, or 1/20 of its advances (borrowings) from the FHLB of Cincinnati, whichever is greater. The Bank was in compliance with this requirement with an investment in FHLB of Cincinnati stock at June 30, 2003 of $10.4 million.

     The FHLB of Cincinnati serves as a reserve or central bank for its member institutions within its assigned region. It is funded primarily from proceeds derived from the sale of consolidated obligations of the FHLB System. It makes advances to members in accordance with policies and procedures established by the FHFB and the Board of Directors of the FHLB of Cincinnati. Long-term advances may be made only for the purpose of providing funds for residential housing finance, small business loans, small farm loans and small agri-business loans. At June 30, 2003, the Bank had $120.1 million in advances outstanding from the FHLB of Cincinnati. See “— Deposit Activity and Other Sources of Funds — Borrowings.”

     Qualified Thrift Lender Test. A savings association that does not meet the Qualified Thrift Lender test (“QTL Test”) must either convert to a bank charter or comply with the following restrictions on its operations: (i) the institution may not engage in any new activity or make any new investment, directly or indirectly, unless such activity or investment is permissible for a national bank; (ii) the branching powers of the institution shall be restricted to those of a national bank; and (iii) payment of dividends by the institution shall be subject to the rules regarding payment of dividends by a national bank. Upon the expiration of three years from the date the institution ceases to be a Qualified Thrift Lender, it must cease any activity, and not retain any investment not permissible for a national bank and savings association.

     To meet the QTL test, the institution must qualify as a domestic building and loan association under the Internal Revenue Code or the institution’s “Qualified Thrift Investments” must total at least 65% of “portfolio assets.” Under OTS regulations, portfolio assets are defined as total assets less intangibles, property used by a savings institution in its business and liquidity investments in an amount not exceeding 20% of assets. Qualified Thrift Investments consist of (i) loans, equity positions or securities related to domestic, residential real estate or manufactured housing, and educational, small business and credit card loans, (ii) 50% of the dollar amount of residential mortgage loans subject to sale under certain conditions, and (iii) stock in an FHLB or the FHLMC or FNMA. In addition, subject to a 20% of portfolio assets limit, savings institutions are able to treat as Qualified Thrift Investments 200% of their investments in loans to finance “starter homes” and loans for construction, development or improvement of housing and community service facilities or for financing small businesses in “credit-needy” areas. In order to maintain QTL status, the savings institution must maintain a weekly average percentage of Qualified Thrift Investments to portfolio assets equal to 65% on a monthly average basis in nine out of 12 months. A savings institution that fails to maintain QTL status will be permitted to requalify once, and if it fails the QTL test a second time, it will become immediately subject to all penalties as if all time limits on such penalties had expired. Failure to qualify as a QTL results in a number of sanctions, including the imposition of certain operating restrictions imposed on national banks. At June 30, 2003, the Bank qualified as a QTL.

     Uniform Lending Standards. Under OTS regulations, savings institutions must adopt and maintain written policies that establish appropriate limits and standards for extensions of credit that are secured by liens or interests in real estate or are made for the purpose of financing permanent improvements to real estate. These policies must establish loan portfolio diversification standards, prudent underwriting standards, including loan-to-value limits, that are clear and measurable, loan administration procedures and documentation, approval and reporting requirements. The real estate lending policies must reflect consideration of the Interagency Guidelines for Real Estate Lending Policies (the “Interagency Guidelines”) that have been adopted by the federal bank regulators.

     The Interagency Guidelines, among other things, call upon depository institutions to establish internal loan-to-value limits for real estate loans that are not in excess of the following supervisory limits; (i) for loans secured by raw land, the supervisory loan-to-value limit is 65% of the value of the collateral; (ii) for land development loans (i.e., loans for the purpose of improving unimproved property prior to the erection of structures), the supervisory limit is 75%; (iii) for loans for the construction of commercial, multifamily or other nonresidential property, the supervisory limit is 80%; (iv) for loans for the construction of one-to-four family properties, the supervisory limit is 85%; and (v) for loans secured by other improved property (e.g., farmland, completed commercial property and other income-producing property including non-owner-occupied, one-to-four family property), the limit is 85%. Although no supervisory loan-

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to-value limit has been established for owner-occupied, one-to-four family and home equity loans, the Interagency Guidelines state that for any such loan with a loan-to-value ratio that equals or exceeds 90% at origination, an institution should require appropriate credit enhancement in the form of either mortgage insurance or readily marketable collateral.

     The Interagency Guidelines state that it may be appropriate in individual cases to originate or purchase loans with loan-to-value ratios in excess of the supervisory loan-to-value limits, based on the support provided by other credit factors. The aggregate amount of loans in excess of the supervisory loan-to-value limits, however, should not exceed 100% of total capital and the total of such loans secured by commercial, agricultural, multi-family and other non-one-to-four family residential properties should not exceed 30% of total capital. The supervisory loan-to-value limits do not apply to certain categories of loans including loans insured or guaranteed by the U.S. government and its agencies or by financially capable state, local or municipal governments or agencies, loans backed by the full faith and credit of a state government, loans that are to be sold promptly after origination without recourse to a financially responsible party, loans that are renewed, refinanced or restructured without the advancement of new funds, loans that are renewed, refinanced or restructured in connection with a workout, loans to facilitate sales of real estate acquired by the institution in the ordinary course of collecting a debt previously contracted and loans where the real estate is not the primary collateral.

     The Bank believes that its current lending policies conform to the Interagency Guidelines.

     Deposit Insurance. The Bank is required to pay assessments, based on a percentage of its insured deposits, to the FDIC for insurance of its deposits by the FDIC through the SAIF of the FDIC. The FDIC is required to set semi-annual assessments for SAIF-insured institutions at a level necessary to maintain the designated reserve ratio of the SAIF at 1.25% of estimated insured deposits, or at a higher percentage of estimated insured deposits that the FDIC determines to be justified for that year by circumstances indicating a significant risk of substantial future losses to the SAIF.

     Under the FDIC’s risk-based deposit insurance assessment system, the assessment rate for an insured depository institution depends on the assessment risk classification assigned to the institution by the FDIC, which is determined by the institution’s capital level and supervisory evaluations. Based on the data reported to regulators for the date closest to the last day of the seventh month preceding the semi-annual assessment period, institutions are assigned to one of three capital groups — well capitalized, adequately capitalized or undercapitalized — using the same percentage criteria as under the prompt corrective action regulations. See “— Prompt Corrective Regulatory Action.” Within each capital group, institutions are assigned to one of three subgroups on the basis of supervisory evaluations by the institution’s primary supervisory authority, and such other information as the FDIC determines to be relevant to the institution’s financial condition and the risk posed to the deposit insurance fund. Subgroup A consists of financially sound institutions with only a few minor weaknesses. Subgroup B consists of institutions that demonstrate weaknesses which, if not corrected, could result in significant deterioration of the institution and increased risk of loss to the deposit insurance fund. Subgroup C consists of institutions that pose a substantial probability of loss to the deposit insurance fund unless effective corrective action is taken.

     The FDIC’s current regular semi-annual SAIF assessment rates set a base assessment rate schedule ranging from 0 to 27 basis points. Until December 31, 1999, SAIF-insured institutions were required to pay assessments to the FDIC at the rate of 6.44 basis points to help fund interest payments on certain bonds issued by the Financing Corporation (“FICO”), an agency of the federal government established to finance takeovers of insolvent thrifts. During this period, Bank Insurance Fund (“BIF”) members were assessed for these obligations at the rate of 1.3 basis points. Since January 1, 2000, both BIF and SAIF members have been assessed at the same rate for FICO payments. At June 30, 2003, the Bank had a risk classification of 1A.

     Dividend Limitations. Under OTS regulations, the Bank may not pay dividends on its capital stock if its regulatory capital would thereby be reduced below the amount then required for the liquidation account established for the benefit of certain depositors of the Bank at the time of the Bank’s conversion from the mutual to stock form. In addition, savings institution subsidiaries of savings and loan holding companies are required to give the OTS 30 days’ prior notice of any proposed declaration of dividends to the holding company.

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     OTS regulations require that savings institutions submit notice to the OTS prior to making a capital distribution (which includes dividends, stock repurchases and amounts paid to stockholders of another institution in a cash merger) if (a) they would not be well capitalized after the distribution, (b) the distribution would result in the retirement of any of the institution’s common or preferred stock or debt counted as its regulatory capital, or (c) the institution is a subsidiary of a holding company. A savings institution must make application to the OTS to pay a capital distribution if (x) the institution would not be adequately capitalized following the distribution, (y) the institution’s total distributions for the calendar year exceeds the institution’s net income for the calendar year to date plus its net income (less distributions) for the preceding two years, or (z) the distribution would otherwise violate applicable law or regulation or an agreement with or conditions imposed by the OTS. If neither the savings institution nor the proposed capital distribution meet any of the foregoing criteria, then no notice or application is required to be filed with the OTS before making a capital distribution. The OTS may disapprove or deny a capital distribution if in the view of the OTS, the capital distribution would constitute an unsafe or unsound practice.

     The Bank is prohibited from making any capital distributions if after making the distribution, it would be undercapitalized as defined in the OTS’ prompt corrective action regulations. After consultation with the FDIC, the OTS may permit a savings institution to repurchase, redeem, retire or otherwise acquire shares or ownership interests if the repurchase, redemption, retirement or other acquisition: (i) is made in connection with the issuance of additional shares or other obligations of the institution in at least an equivalent amount; and (ii) will reduce the institution’s financial obligations or otherwise improve the institution’s financial condition.

     In addition to the foregoing, earnings of the Bank appropriated to bad debt reserves and deducted for federal income tax purposes are not available for payment of cash dividends without payment of taxes at the then current tax rate by the Bank on the amount of earnings removed from the reserves for such distributions. See “Taxation.” The Bank intends to make full use of this favorable tax treatment afforded to the Bank and does not contemplate use of any earnings of the Bank in a manner which would limit the Bank’s bad debt deduction or create Federal tax liabilities.

     Federal Reserve System. Pursuant to regulations of the Federal Reserve Board, a savings institution must maintain average daily reserves equal to 3% on transaction accounts of between $0 and $42.1 million, plus 10% on the remainder. These percentages are subject to adjustment by the Federal Reserve Board. Because required reserves must be maintained in the form of vault cash or in a noninterest-bearing account at a Federal Reserve Bank, the effect of the reserve requirement is to reduce the amount of the institution’s interest-earning assets. At June 30, 2003, Park View Federal met its reserve requirements.

     Interstate and Interindustry Acquisitions. OTS regulations permit federal savings institutions to branch in any state or states of the United States and its territories. Except in supervisory cases or when interstate branching is otherwise permitted by state law or other statutory provision, an institution may not establish an out-of-state branch unless (i) the institution qualifies as a “domestic building and loan association” under §7701(a)(19) of the Internal Revenue Code and the total assets attributable to all branches of the association in the state would qualify such branches taken as a whole for treatment as a domestic building and loan association or as a QTL, and (ii) such branch would not result in (a) formation of a prohibited multi-state multiple savings and loan holding company, or (b) a violation of certain statutory restrictions on branching by savings institution subsidiaries of banking holding companies. Federal savings institutions generally may not establish new branches unless the institution meets or exceeds minimum regulatory capital requirements. The OTS will also consider the institution’s record of compliance with the Community Reinvestment Act in connection with any branch application.

     The Federal Reserve Board may permit the acquisition of a savings institution by a bank holding company. In approving an application by a bank holding company to acquire a savings institution, the Federal Reserve Board is prohibited from imposing restrictions on tandem operations of the subsidiary savings institution and its holding company affiliates except as required under Sections 23A and 23B of the Federal Reserve Act, as amended.

     A bank holding company that controls a savings institution may merge or consolidate the assets and liabilities of the savings institution with, or transfer assets and liabilities to, any subsidiary bank which is a BIF member with the approval of the appropriate federal banking agency and the Federal Reserve Board. The resulting bank will be required to continue to pay assessments to the SAIF at the rates prescribed for SAIF members on the deposits attributable to the merged savings institution plus an annual growth increment. In addition, the transaction must comply with the restrictions on interstate acquisitions of commercial banks under the Bank Holding Company Act.

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     Loans-to-One-Borrower Limitations. Under federal law, loans and extensions of credit, that are not fully secured by collateral with a market value at least equal to the amount of the loan or extension of credit, outstanding at one time to a person shall not exceed 15% of the unimpaired capital and surplus of the savings institution. Loans and extensions of credit fully secured by certain readily marketable collateral may represent an additional 10% of unimpaired capital and surplus. OTS regulations permit certain exceptions to the above general limitations. Specifically, savings associations may make loans to one borrower, by order of the Director of OTS, in an amount not to exceed the lesser of $30,000,000 or 30% of unimpaired capital and surplus to develop residential housing, provided: (i) the purchase price of each single-family dwelling in the development does not exceed $500,000; (ii) the savings institution is in compliance with regulatory capital requirements; (iii) the loans comply with applicable loan-to-value requirements; and (iv) the aggregate amount of loans made under this authority does not exceed 150% of unimpaired capital and surplus. A savings institution is authorized to make loans to one borrower to finance the sale of real property acquired in satisfaction of debts in an amount up to 50% of unimpaired capital and surplus.

     Transactions with Affiliates. Transactions between savings institutions and any affiliate are governed by Sections 23A and 23B of the Federal Reserve Act. An affiliate of a savings institution is any company or entity which controls, is controlled by or is under common control with the savings institution. In a holding company context, the parent holding company of a savings institution (such as the Company) and any companies which are controlled by such parent holding company are affiliates of the savings institution. Generally, Sections 23A and 23B (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, and contain an aggregate limit on all such transactions with all affiliates to an amount equal to 20% of such capital stock and surplus, and (ii) require that all such transactions be on terms substantially the same, or at least as favorable, to the institution or subsidiary as those provided to a nonaffiliated. The term “covered transaction” includes the making of loans, purchase of assets, issuance of a guarantee and similar other types of transactions. In addition to the restrictions imposed by Sections 23A and 23B, no savings institution may (i) loan or otherwise extend credit to an affiliate, except for any affiliate which engages only in activities which are permissible for bank holding companies, or (ii) purchase or invest in any stocks, bonds, debentures, notes or similar obligations of any affiliate, except for affiliates which are subsidiaries of the savings institution. Section 106 of the Bank Holding Company Act of 1956, as amended (“BHCA”) which also applies to the Bank, prohibits the Bank from extending credit to or offering any other services, or fixing or varying the consideration for such extension of credit or service, on condition that the customer obtain some additional services from the institution or certain of its affiliates or not obtain services of a competitor of the institution, subject to certain exceptions.

     Savings institutions are also subject to the restrictions contained in Section 22(h) and Section 22(g) of the Federal Reserve Act on loans to executive officers, directors and principal stockholders. Under Section 22(h), loans to a director, executive officer or to a greater than 10% stockholder of a savings institution, and certain affiliated entities of the foregoing, may not exceed, together with all other outstanding loans to such person and affiliated entities the institution’s loan to one borrower limit (generally equal to 15% of the institution’s unimpaired capital and surplus and an additional 10% of such capital and surplus for loans fully secured by certain readily marketable collateral). Section 22(h) also prohibits loans, above amounts prescribed by the appropriate federal banking agency, to directors, executive officers and greater than 10% stockholders of a savings institution, and their respective affiliates, unless such loan is approved in advance by a majority of the board of directors of the institution with any “interested” director not participating in the voting. The Federal Reserve Board has prescribed the loan amount (which includes all other outstanding loans to such person), as to which such prior board of director approval is required, as being the greater of $25,000 or 5% of capital and surplus (up to $500,000). Further, the Federal Reserve Board pursuant to Section 22(h) requires that loans to directors, executive officers and principal stockholders be made on terms substantially the same as offered in comparable transactions to other persons. Section 22(h) also generally prohibits a depository institution from paying the overdrafts of any of its executive officers or directors.

     Section 22(g) of the Federal Reserve Act requires that loans to executive officers of depository institutions not be made on terms more favorable than those afforded to other borrowers, requires approval for such extensions of credit by the board of directors of the institution, and imposes reporting requirements for and additional restrictions on the type, amount and terms of credits to such officers. In addition, Section 106 of the BHCA extensions of credit to executive officers, directors, and greater than 10% stockholders of a depository institution by any other institution which has a correspondent banking relationship with the institution, unless such extension of

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credit is on substantially the same terms as those prevailing at the time for comparable transactions with other persons and does not involve more than the normal risk of repayment or present other unfavorable features.

REGULATION OF THE COMPANY

General

     The company is a savings and loan holding company as defined by the Home Owners’ Loan Act. As such, the Company is registered with the OTS and is subject to OTS regulation, examination, supervision and reporting requirements. As a subsidiary of a savings and loan holding company, the Bank is subject to certain restrictions in its dealings with the Company and affiliates thereof.

     Activities Restrictions. The Board of Directors of the Company presently intends to operate the Company as a unitary savings and loan holding company. Since the Company became a unitary savings and loan holding company before May 4, 1999, there are generally no restrictions on the activities of the Company. However, if the Director of 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 institution, the Director of the OTS may impose such restrictions as deemed necessary to address such risk including limiting: (i) payment of dividends by the savings institution; (ii) transactions between the savings institution and its affiliates; and (iii) any activities of the savings institution that might create a serious risk that the liabilities of the holding company and its affiliates may be imposed on the savings institution. Notwithstanding the above rules as to permissible business activities of unitary savings and loan holding companies, if the savings institution subsidiary of such a holding company fails to meet the QTL Test, then such unitary holding company shall also presently become subject to the activities restrictions applicable to multiple holding companies and, unless the savings institution requalifies as a QTL within one year thereafter, register as, and become subject to the restrictions applicable to a bank holding company. See “— Regulation of the Bank — Qualified Thrift Lender Test.”

     If the Company were to acquire control of another savings institution, other than through merger or other business combination with the Bank, the Company 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 institution meets the QTL Test, the activities of the Company and any of its subsidiaries (other than the Bank or other subsidiary savings institutions) would thereafter be subject to further restrictions. Among other things, no multiple savings and loan holding company or subsidiary thereof which is not a savings institution shall commence or continue for a limited period of time after becoming a multiple savings and loan holding company or subsidiary thereof, any business activity, upon prior notice to, and no objection by, the OTS, 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 authorized by regulation as of March 5, 1987 to be engaged in by multiple holding companies; or (vii) unless the Director of the OTS by regulation prohibits or limits such activities for savings and loan holding companies, those activities authorized by the Federal Reserve Board as permissible for bank holding companies. Those activities described in (vii) above must also be approved by the Director of the OTS prior to being engaged in by a multiple holding company.

     Restrictions on Acquisitions. Savings and loan holding companies are prohibited from acquiring, without prior approval of the Director of OTS, (i) control of any other savings institution or savings and loan holding company or substantially all the assets thereof, or (ii) more than 5% of the voting shares of a savings institution or holding company thereof which is not a subsidiary. Under certain circumstances, a registered savings and loan holding company is permitted to acquire, with the approval of the Director of the OTS, up to 15% of the voting shares of an undercapitalized savings institution pursuant to a “qualified stock issuance” without that savings institution being deemed controlled by the holding company. In order for the shares acquired to constitute a “qualified stock issuance,” the shares must consist of previously unissued stock or treasury shares, the shares must be acquired for cash, the savings and loan holding company’s other subsidiaries must have tangible capital of at least 6 1/2% of total assets, there must not be more than one common director or officer between the savings and loan holding company and the issuing savings institution, and transactions between the savings institution and the savings and loan holding company and any of its affiliates must conform to Sections 23A and 23B of the Federal Reserve Act. Except with the prior approval of

26

the Director 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 savings institution, or of any other savings and loan holding company.

     The Director of the OTS may only approve acquisitions resulting in the formation of a multiple savings and loan holding company which controls savings institutions in more than one state if: (i) the multiple savings and loan holding company involved controls a savings institution which operated a home or branch office in the state of the institution to be acquired as of March 5, 1987; (ii) the acquiror is authorized to acquire control of the savings institution pursuant to the emergency acquisition provisions of the Federal Deposit Insurance Act; or (iii) the statutes 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).

     Sarbanes-Oxley Act of 2002. On July 30, 2002, the Sarbanes-Oxley Act of 2002 (“SOX”) was signed into law which mandated a variety of reforms intended to address corporate and accounting fraud. SOX contained provisions which amend the Securities Exchange Act of 1934, as amended (the “Act”) and provisions which directed the SEC to promulgate rules. The resultant law and regulations under the Act as of the time of this annual report is set forth in the following paragraphs. SOX provides for the establishment of a new Public Company Accounting Oversight Board (“PCAOB”), which enforces auditing, quality control and independence standards for firms that audit Securities and Exchange Commission (“SEC”)-reporting companies and is funded by fees from all SEC-reporting companies. SOX imposes higher standards for auditor independence and restricts the provision of consulting services by auditing firms to companies they audit. Any non-audit services being provided to an audit client must be preapproved by the Company’s audit committee members. In addition, certain audit partners must be rotated periodically. SOX requires chief executive officers and chief financial officers, or their equivalent, to certify to the accuracy of periodic reports filed with the SEC, subject to civil and criminal penalties if they knowingly or willfully violate this certification requirement. In addition, under SOX, legal counsel is required to report evidence of a material violation of the securities laws or a breach of fiduciary duty by a company to its chief executive officer or its chief legal officer, and, if such officer does not appropriately respond, to report such evidence to the audit committee or other similar committee of the board of directors or the board itself.

     Longer prison terms apply to corporate executives who violate federal securities laws, the period during which certain types of suits can be brought against a company or its officers was extended, and bonuses issued to top executives prior to restatement of a company’s financial statements are now subject to disgorgement if such restatement was due to corporate misconduct. Executives are also prohibited from trading during retirement plan “blackout” periods, and loans to company executives are restricted. Directors and executive officers must also report most changes in their ownership of a company’s securities within two business days of the change, and all ownership reports must be electronically filed.

     SOX also increased the oversight and authority of audit committees of publicly traded companies. Audit committee members must be independent and are barred from accepting consulting, advisory or other compensatory fees from the issuer. Audit committees of publicly traded companies must have authority to retain their own counsel and other advisors funded by the company. Audit committees must establish procedures for the receipt, retention and treatment of complaints regarding accounting and auditing matters and procedures for confidential, anonymous submission of employee concerns regarding questionable accounting or auditing matters. It is the responsibility of the audit committee to hire, oversee and work on disagreements with the Company’s independent auditor.

     Beginning six months after the SEC determines that the PCAOB is able to carry out its functions, it will be unlawful for any person that is not a registered public accounting firm (“RPAF”) to audit an SEC-reporting company. Under the Act, a RPAF is prohibited from performing statutorily mandated audit services for a company if such company’s chief executive officer, chief financial officer, comptroller, chief accounting officer or any person serving in equivalent positions has been employed by such firm and participated in the audit of such company during the one-year period preceding the audit initiation date. SOX also prohibits any officer or director of a company or any other person acting under their direction from taking any action to fraudulently influence, coerce, manipulate or mislead any independent public or certified accountant engaged in the audit of the Company’s financial statements for the purpose of rendering the financial statement’s materially misleading. SOX requires the RPAF that issues the audit report to attest to and report on management’s assessment of the Company’s internal

27

controls. In addition, SOX requires that each financial report required to be prepared in accordance with (or reconciled to) generally accepted accounting principles and filed with the SEC reflect all material correcting adjustments that are identified by a RPAF in accordance with generally accepted accounting principles and the rules and regulations of the SEC.

     Although the Company anticipates it will incur additional expense in complying with the provisions of the Act and the related rules, management does not expect that such compliance will have a material impact on the Company’s financial condition or results of operations.

TAXATION

General

     The Company and its subsidiaries currently file a consolidated federal income tax return based on a fiscal year ending June 30. Consolidated returns have the effect of eliminating intercompany distributions, including dividends, from the computation of consolidated taxable income for the taxable year in which the distributions occur.

Federal Income Taxation

     Savings institutions are subject to the provisions of the Internal Revenue Code of 1986, as amended (the “Code”) in the same general manner as other corporations. Prior to legislation in 1996, institutions such as the Bank which met certain definitional tests and other conditions prescribed by the Code benefited from certain favorable provisions regarding their deductions from taxable income for annual additions to their bad debt reserve. Legislation that is effective for tax years beginning after December 31, 1995 repealed the reserve method available to thrifts and required institutions to recapture into taxable income over a six taxable year period the portion of the tax loan loss reserve that exceeds the pre-1988 tax loan loss reserve. The Bank had no such excess reserve. The Bank will no longer be allowed to use the percentage of taxable income method for tax loan loss provisions, but was allowed to use the experience method of accounting for bad debts as long as it was not considered a large thrift. Beginning with June 30, 1997 taxable year, the Bank was treated the same as a small commercial bank. Institutions with less than $500 million in assets were still permitted to make deductible bad debt additions to reserves, using the experience method. Beginning with the June 30, 2000 taxable year, the Bank will be taxed as a large thrift and will only be able to take a tax deduction when a loan is actually charged off.

     Earnings appropriated to the Bank’s bad debt reserve and claimed as a tax deduction are not available for the payment of cash dividends or for distribution to stockholders (including distributions made on dissolution or liquidation), unless the Bank includes the amount in taxable income, along with the amount deemed necessary to pay the resulting federal income tax.

     In addition to the regular income tax, corporations generally 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. 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.

     The Bank’s federal income tax returns through June 30, 1999 were audited by the IRS. The years June 30, 2000 through June 30, 2002 are open to audit.

     For further information regarding federal income taxes, see Note 10 of Notes to Consolidated Financial Statements.

State Income Taxation

     The Bank is subject to an Ohio franchise tax based on its equity capital plus certain reserve amounts. Total equity capital for this purpose is reduced by certain exempted assets. The resulting net taxable value of capital is taxed

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at a rate of 1.3%. The Company generally elects to be taxed as a qualifying holding company and pay Ohio tax based on its net income only. The other subsidiaries of the Company are taxed on the greater of a tax based on net income or net worth.

EXECUTIVE OFFICERS OF THE REGISTRANT

     The following sets forth information with respect to the executive officers of the Company.

	Age as of
Name	September 8, 2003		Title
John R. Male		55	Chairman of the Board and Chief Executive Officer of the Company and the Bank
C. Keith Swaney		60	President and Chief Operating Officer of the Company and the Bank, Treasurer of the Company and Chief Financial Officer of the Bank
Jeffrey N. Male		54	Vice President and Secretary of the Company and Executive Vice President and Chief Lending Officer of the Bank

     John R. Male. Mr. Male has been with the Bank since 1971, where he has held various positions including branch manager, mortgage loan officer, manager of construction lending, savings department administrator and chief lending officer. Mr. Male was named President and Chief Executive Officer of the Bank in 1986 and was named President of the Company upon its organization in 1994. Mr. Male was named Chairman of the Board of Directors and Chief Executive Officer of the Company and the Bank in October 2000. Mr. Male serves in various public service and charitable organizations. He currently serves on the Board of Trustees for Heather Hill, a long-term care hospital in Chardon, Ohio. He has an undergraduate degree from Tufts University and an MBA from Case Western Reserve University.

     C. Keith Swaney. Mr. Swaney joined the Bank in 1962 and was named Executive Vice President and Chief Financial Officer in 1986. He was named Vice President and Treasurer of the Company upon its organization in 1994. Mr. Swaney was named President and Chief Operating Officer of the Company and the Bank in October 2000. He continues to serve as Treasurer of the Company and as Chief Financial Officer of the Bank. He is responsible for all internal operations of the Company and the Bank. Over the years, he has participated in various charitable organizations and currently serves on the Board of Trustees for Hiram House Camp. Mr. Swaney attended Youngstown State University and California University in Pennsylvania.

     Jeffrey N. Male. Mr. Male has been with the Bank since 1973. He has served in various capacities including supervisor of the construction loan department, personnel director and manager of the collection, foreclosure and REO departments. Mr. Male was named Executive Vice President of the Bank in 2000. In 1986 Mr. Male was named Senior Vice President in charge of residential lending operations. He was named Vice President and Secretary of the Company upon its organization in 1994 and continues to serve in that position. Mr. Male has served in various capacities with public service and charitable organizations, including the Chagrin Valley Jaycees, the Chagrin Falls Chamber of Commerce and the Neighborhood Housing Services Corporate Loan Committee. Mr. Male is a graduate of Denison University.

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Item 2. Properties

     The following table sets forth the location and certain additional information regarding the Company’s offices at June 30, 2003.

	Year				Net Book		Owned or		Approximate
	Opened/		Total		Value at		Leased/		Square
Location	Acquired		Deposits		June 30, 2003		Expiration		Footage
			(Dollars in thousands)
Main Office:
30000 Aurora Road		2000	$	16,917	$	5,506	Owned			51,635
Solon, Ohio
Branch Offices:
2111 Richmond Road		1967		65,748		46	Lease			2,750
Beachwood, Ohio								3/1/09
415 Northfield Road		2002		43,407		336	Lease			3,084
Bedford, Ohio								11/1/12
11010 Clifton Blvd		1974		33,381		201	Lease			1,550
Cleveland, Ohio								8/1/05
13901 Ridge Road		1999		55,558		27	Lease			3,278
North Royalton, Ohio								8/31/04
6990 Heisley Road		1994		30,783		36	Lease			2,400
Mentor, Ohio								10/25/03
1456 SOM Center Road		1995		33,203		70	Lease			2,200
Mayfield Heights, Ohio								9/30/04
497 East Aurora Road		1994		38,226		2	Lease			2,400
Macedonia, Ohio								9/30/04
8500 Washington Street		1995		36,697		664	Owned			2,700
Chagrin Falls, Ohio
408 Water Street		1997		24,266		506	Owned			2,800
Chardon, Ohio
3613 Medina Road		2000		21,895		27	Lease			2,440
Medina, Ohio								8/31/04
34400 Aurora Road		2000		24,137		70	Lease			3,000
Solon, Ohio								4/30/10
16909 Chagrin Blvd		2000		39,201		124	Lease			2,904
Shaker Hts., Ohio								6/30/10
36311 Detroit Road		2002		26,666		271	Lease			3,375
Avon, Ohio								8/31/12
17780 Pearl Road		2002		36,344		173	Lease			3,500
Strongsville, Ohio								8/31/12

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     At June 30, 2003 the net book value of the Company’s premises, furniture, fixtures and equipment was $11.6 million. See Note 6 of Notes to Consolidated Financial Statements for further information.

     The Company also owns real estate in Solon, Ohio. See “Item 1. Business— Subsidiary Activities” for further information.

Item 3. Legal Proceedings

     From time to time, the Company and/or the Bank is a party to various legal proceedings incident to its business. There are no material legal proceedings to which the Bank or PVF is a party or to which any of their property is subject.

Item 4. Submission of Matters to a Vote of Security Holders

     No matters were submitted to a vote of security holders during the fourth quarter of the fiscal year ended June 30, 2003.

PART II

Item 5. Market for the Registrant’s Common Equity and Related Stockholder Matters

     The information contained under the section captioned “Market Information” in the Company’s Annual Report to Stockholders for the Fiscal Year Ended June 30, 2003 (the “Annual Report”) is incorporated herein by reference. For information regarding restrictions on the payment of dividends see “Item 1. Business — Regulation of the Bank — Dividend Limitations.”

Item 6. Selected Financial Data

     The information contained in the table captioned “Selected Consolidated Financial and Other Data” in the Annual Report is incorporated herein by reference.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

     The information contained in the section captioned “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Annual Report is incorporated herein by reference.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

     The information contained in the section captioned “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Asset/Liability Management” in the Annual Report incorporated herein by reference.

Item 8. Financial Statements and Supplementary Data

     The consolidated financial statements contained in the Annual Report which are listed under Item 14 herein are incorporated herein by reference.

     The report of KPMG LLP with respect to the consolidated statements of operations, shareholder’s equity, and cash flows of the Company for the year ended June 30, 2001 follows.

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Independent Auditors’ Report

The Board of Directors
PVF Capital Corp.:

We have audited the accompanying consolidated statements of operations, stockholders’ equity, and cash flows of PVF Capital Corp. and subsidiaries (Company) for the year ended June 30, 2001. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. 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 statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the results of operations and cash flows of PVF Capital Corp. and subsidiaries for the year ended June 30, 2001, in conformity with accounting principles generally accepted in the United States of America.

/s/ KMPG LLP

Cleveland, Ohio
July 27, 2001

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Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Not applicable.

Item 9A. Controls and Procedures

     As of the end of the period covered by this report, management of the Company carried out an evaluation, under the supervision and with the participation of the Company’s principal executive officer and principal financial officer, of the effectiveness of the Company’s disclosure controls and procedures. Based on this evaluation, the Company’s principal executive officer and principal financial officer concluded that the Company’s disclosure controls and procedures are effective in ensuring that information required to be disclosed by the Company in reports that it files or submits under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. It should be noted that the design of the Company’s disclosure controls and procedures is based in part upon certain reasonable assumptions about the likelihood of future events, and there can be no reasonable assurance that any design of disclosure controls and procedures will succeed in achieving its stated goals under all potential future conditions, regardless of how remote, but the Company’s principal executive and financial officers have concluded that the Company’s disclosure controls and procedures are, in fact, effective at a reasonable assurance level.

     There have been no changes in the Company’s internal control over financial reporting (to the extent that elements of internal control over financial reporting are subsumed within disclosure controls and procedures) identified in connection with the evaluation described in the above paragraph that occurred during the Company’s last fiscal quarter, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART III

Item 10. Directors and Executive Officers of the Registrant

     The information contained under the section captioned “Proposal I — Election of Directors” in the Company’s definitive proxy statement for the Company’s 2003 Annual Meeting of Stockholders (the “Proxy Statement”) is incorporated herein by reference.

Item 11. Executive Compensation

     The information contained under the section captioned “Proposal I — Election of Directors — Executive Compensation” and “— Directors’ Compensation” in the Proxy Statement is incorporated herein by reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

(a) and (b)	The information required by this item is incorporated herein by reference to the sections captioned “Proposal I — Election of Directors” and “Voting Securities and Principal Holders Thereof” of the Proxy Statement.
(c)	Management knows of no arrangements, including any pledge by any person of securities of the Bank, the operation of which may at a subsequent date result in a change in control of the registrant.
(d)	This information required by this item is incorporated herein by reference to the section captioned “Proposal II – Approval of the Amended and Restated PVF Capital Corp. 2000 Incentive Stock Option Plan – Equity Compensation Plans” of the Proxy Statement.

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Item 13. Certain Relationships and Related Transactions

     The information required by this item is incorporated herein by reference to the section captioned “Proposal I — Election of Directors” of the Proxy Statement.

PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a)	1.	Independent Auditors’ Report (incorporated by reference to the Annual Report)
		Consolidated Financial Statements (incorporated by reference to the Annual Report)
		(a)	Consolidated Statements of Financial Condition, at June 30, 2003 and 2002
		(b)	Consolidated Statements of Operations for the Years Ended June 30, 2003, 2002 and 2001
		(c)	Consolidated Statements of Stockholders’ Equity for the Years Ended June 30, 2003, 2002 and 2001
		(d)	Consolidated Statements of Cash Flows for the Years Ended June 30, 2003, 2002 and 2001
		(e)	Notes to Consolidated Financial Statements.
	2.	All schedules have been omitted as the required information is either inapplicable or included in the Notes to Consolidated Financial Statements.
	3.	Exhibits and Index to Exhibits
		The following exhibits are either attached to or incorporated by reference in this Annual Report on Form 10-K.

No.	Description
3.1	Certificate of Incorporation, as amended	***
3.2	Code of Regulations	*
3.3	Bylaws
4	Specimen Stock Certificate	*
10.1	Park View Federal Savings Bank Conversion Stock Option Plan †	*
10.2	PVF Capital Corp. 1996 Incentive Stock Option Plan †	*
10.3	Form of Severance Agreement between PVF Capital Corporation and each of John R. Male, C. Keith Swaney and Jeffrey N. Male †	***
10.4	Park View Federal Savings Bank Supplemental Executive Retirement Plan †	**
10.5	PVF Capital Corp. 2000 Incentive Stock Option Plan and Deferred Compensation Plan†
13	PVF Capital Corp. Annual Report to Stockholders for the year ended June 30, 2003
21	Subsidiaries of the Registrant
23.1	Consent of KPMG LLP
23.2	Consent of Crowe Chizek and Company, LLP
31	Rule 13a-14(a) Certifications
32	Section 1350 Certification

* Incorporated by reference to the Registrant’s Annual Report on Form 10-K for the year ended June 30, 1996 (Commission File No. 0-24948).

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**	Incorporated by reference to the Registrant’s Annual Report on Form 10-K for the year ended June 30, 1998 (Commission File No. 0-24948).
***	Incorporated by reference to the Registrant’s Annual Report on Form 10-K for the year ended June 30, 2002 (Commission File No. 0-24948).
†	Management contract or compensory plan or arrangement.
(b)	The Company filed a Current Report on Form 8-K on April 17, 2003 reporting under Items 7 and 12 and furnishing its press release dated April 16, 2003 in which it announced its unaudited financial results for the quarter and nine-month periods ended March 31, 2003.
(c)	All required exhibits are filed as attached.
(d)	No financial statement schedules are required.

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SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	PVF CAPITAL CORP.
September 23, 2003	By:	/s/ John R. Male      John R. Male      Chairman of the Board of Directors      and Chief Executive Officer

     Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

/s/ John R. Male John R. Male Chairman of the Board of Directors and Chief Executive Officer (Principal Executive Officer)	September 23, 2003
/s/ C. Keith Swaney C. Keith Swaney President, Chief Operating Officer and Treasurer (Principal Financial and Accounting Officer)	September 23, 2003
/s/ Robert K. Healey Robert K. Healey Director	September 23, 2003
/s/ Stanley T. Jaros Stanley T. Jaros Director	September 23, 2003
/s/ Stuart D. Neidus Stuart D. Neidus Director	September 23, 2003
/s/ Gerald A. Fallon Gerald A. Fallon Director	September 23, 2003
/s/ Raymond J. Negrelli Raymond J. Negrelli Director	September 23, 2003
/s/ Ronald D. Holman, II Ronald D. Holman, II Director	September 23, 2003

36 EX-3.3 3 l02888aexv3w3.txt EX-3.3 BYLAWS Exhibit 3.3 BYLAWS OF THE BOARD OF DIRECTORS OF PVF CAPITAL CORP. ARTICLE I BOARD OF DIRECTORS SECTION 1. General Powers. The business and affairs of PVF Capital Corp. (herein the "Corporation") shall be under the direction of its board of directors. The board of directors shall annually elect a chairman of the board from among its members. The chairman of the board shall preside at all meetings of the board of directors. SECTION 2. Number and Term. The board of directors shall consist of eight members, and shall be divided into three classes as nearly equal in number as possible. The members of each class shall be elected for a term of three years and until their successors are elected and qualified. One class shall be elected by ballot annually. SECTION 3. Regular Meetings. A regular meeting of the board of directors shall be held without other notice than this Section immediately after, and at the same place as, the annual meeting of stockholders. The board of directors may provide, by resolution, the time and place for the holding of additional regular meetings without other notice than such resolution. SECTION 4. Special Meetings. Special meetings of the board of directors may be called by or at the request of the chairman of the board or the president, or by one-third of the directors. The persons authorized to call special meetings of the board of directors may fix any place as the place for holding any special meeting of the board of directors called by such persons. Members of the board of directors may participate in special meetings by means of conference telephone or similar communications equipment by which all persons participating in the meeting can hear each other. Such participation shall constitute presence in person. SECTION 5. Notice. Written notice of any special meeting shall be given to each director at least two days previous thereto delivered personally or by telegram or at least five days previous thereto delivered by mail at the address at which the director is most likely to be reached. Such notice shall be deemed to be delivered when deposited in the United States mail so addressed, with postage thereon prepaid if mailed or when delivered to the telegraph company if sent by telegram. Any director may waive notice of any meeting by a writing filed with the secretary. The attendance of a director at a meeting shall constitute a waiver of notice of such meeting, unless, prior to or at the commencement of such meeting, such director objects to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any meeting of the board of directors need be specified in the notice or waiver of notice of such meeting. SECTION 6. Quorum. A majority of the number of directors fixed by Section 2 of this Article I shall constitute a quorum for the transaction of business at any meeting of the board of directors, but if less than such majority is present at a meeting, a majority of the directors present may adjourn the meeting from time to time. Notice of any adjourned meeting shall be given in the same manner as prescribed by Section 5 of this Article I. SECTION 7. Manner of Acting. The act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the board of directors, unless a greater number is prescribed by these Bylaws, the Articles of Incorporation, or the laws of Ohio. SECTION 8. Action Without a Meeting. Any action required or permitted to be taken by the board of directors at a meeting may be taken without a meeting if a consent in writing, setting forth the action so taken, shall be signed by all of the directors. SECTION 9. Resignation. Any director may resign at any time by sending a written notice of such resignation to the home office of the Corporation addressed to the chairman of the board or the president. Unless otherwise specified therein such resignation shall take effect upon receipt thereof by the chairman of the board or the president. SECTION 10. Vacancies. Vacancies occuring in the board of directors shall be filled in accordance with the provisions of the Corporation's Articles of Incorporation. A director elected to fill a vacancy shall be elected to serve until the annual meeting of stockholders at which the term of the class to which the director has been chosen expires. SECTION 11. Presumption of Assent. Unless Ohio law provides otherwise, a director of the Corporation who is present at a meeting of the board of directors at which action on any Corporation matter is taken shall be presumed to have assented to the action taken unless (i) he objects at the beginning of the meeting (or promptly upon his arrival) to holding the meeting or transacting business at the meeting; (ii) his dissent or abstention from the action taken is entered in the minutes of the meeting; or (iii) he delivers written notice of his dissent or abstention to the presiding officer of the meeting before its adjournment or to the Corporation immediately after adjournment of the meeting. The right of dissent or abstention is not available to a director who votes in favor of the action taken. SECTION 12. Compensation. The board of directors may, by resolution, from time to time establish the compensation to be paid to directors for their service as such. Members of either standing or special committees may be allowed such compensation for actual attendance at committee meetings as the board of directors may determine. ARTICLE II COMMITTEES OF THE BOARD OF DIRECTORS The board of directors may, by resolution passed by a majority of the whole board, designate one or more committees, as they may determine to be necessary or appropriate for the conduct of the business of the Corporation, and may prescribe the duties, constitution and procedures thereof. Each committee shall consist of not less than three directors of the Corporation. The board may designate not less than three directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. The board of directors shall have power, by the affirmative vote of a majority of the number of directors fixed by Article I, Section 2, at any time to change the members of, to fill vacancies in, and to discharge any committee of the board. Any member of any such committee may resign at any time by giving notice to the Corporation; provided, however, that notice to the board, the chairman of the board, the chief executive officer, the chairman of such committee, or the secretary shall be deemed to constitute notice to the Corporation. Such resignation shall take effect upon receipt of such notice or at any later time specified therein; and, unless otherwise specified therein, acceptance of such resignation shall not be necessary to make it effective. Any member of any such committee may be removed at any time, either with or without cause, by the affirmative vote of a majority of the authorized number of directors at any meeting of the board called for that purpose. ARTICLE III AMENDMENT These Bylaws may be amended in whole or in part at any time by the Board of Directors by the affirmative vote of a majority of the authorized number of directors. EX-10.5 4 l02888aexv10w5.txt EX-10.5 2000 INCENTIVE PLAN Exhibit 10.5 PVF CAPITAL CORP. 2000 INCENTIVE STOCK OPTION AND DEFERRED COMPENSATION PLAN ARTICLE 1 PURPOSE 1.1 GENERAL. The purpose of the PVF Capital Corp. 2000 Incentive Stock Option and Deferred Compensation Plan (the "Plan") is to promote the success and enhance the value of PVF Capital Corp. (the "Company") by linking the personal interests of the members of the Board and the Company's employees, officers and executives to those of Company shareholders and by providing such individuals with an incentive for outstanding performance in order to generate superior returns to shareholders of the Company. The Plan is further intended to provide flexibility to the Company in its ability to motivate, attract, and retain the services of members of the Board, employees, officers, and executives of the Company upon whose judgment, interest, and special effort the successful conduct of the Company's operation is largely dependent. For purposes of this Plan, "Company" shall be deemed to include subsidiaries of PVF Capital Corp., unless the context requires otherwise. ARTICLE 2 EFFECTIVE DATE AND TERM 2.1 EFFECTIVE DATE. The Plan was originally effective as of September 26, 2000 (the "Effective Date"). The Plan, as hereby amended and restated, will be effective as of the date it is approved by the shareholders of the Company. No Awards which could not have been granted under the prior version of the Plan shall be made prior to shareholder approval of this amended and restated version of the Plan. 2.2 TERM. Unless sooner terminated by the Board, the Plan shall terminate on the tenth (10th) anniversary of the Effective Date, and no Awards may be granted under the Plan thereafter. The termination of the Plan shall not affect any Award that is outstanding on the termination date, without the consent of the Participant. ARTICLE 3 DEFINITIONS AND CONSTRUCTION 3.1 DEFINITIONS. When a word or phrase appears in this Plan with the initial letter capitalized, and the word or phrase does not commence a sentence, the word or phrase shall generally be given the meaning ascribed to it in this Section or in Sections 1.1 or 2.1 unless a clearly different meaning is required by the context. The following words and phrases shall have the following meanings: (a) "Award" means any Option, Stock Appreciation Right, Restricted Stock Award, Unrestricted Stock Award, or Performance-Based Award granted to a Participant under the Plan. (b) "Award Agreement" means a writing, in such form as the Committee in its discretion shall prescribe, evidencing an Award. (c) "Bank" means Park View Federal Savings Bank. (d) "Board" means the Board of Directors of the Company. (e) "Cause" means, in the good faith determination of the Board, the Participant's personal dishonesty, incompetence, willful misconduct, breach of fiduciary duty involving personal profit, intentional failure to perform stated duties, or willful violation of any law, rule or regulation (other than traffic violations or similar offenses) or final cease-and-desist order. No act, or failure to act, on the Participant's part shall be considered "willful" unless he has acted, or failed to act, with an absence of good faith and without a reasonable belief that his action or failure to act was in the best interest of the Company. (f) "Change in Control" means: (1) the acquisition by a person or persons acting in concert of the power to vote twenty-five percent (25%) or more of a class of the Company's voting securities; (2) the acquisition by a person of the power to direct the Bank's or Company's management or policies, if the Board of Directors or the OTS has made a determination that such acquisition constitutes or will constitute an acquisition of control of the Bank or the Company for the purposes of the Savings & Loan Holding Company Act or the Change in Bank Control Act and the regulations thereunder; (3) during any period of two (2) consecutive years, individuals who at the beginning of such period constitute the members of the Board cease, for any reason, to constitute at least a majority thereof, unless the election of each director who was not a director at the beginning of such period has been approved in advance by directors representing at least two-thirds (2/3) of the directors then in office who were directors in office at the beginning of the period; provided, however, that for purposes of this clause (3), each director who is first elected to the Board (or first nominated by the Board for election by the shareholders) with the approval of at least two-thirds (2/3) of the directors who were directors at the beginning of the period shall be deemed to be a director at the beginning of the two-year period; (4) the Company shall have merged into or consolidated with another corporation, or merged another corporation into the Company, on a basis whereby less than fifty percent (50%) of the total voting power of the surviving corporation is represented by shares held by persons who were shareholders of the Company immediately before the merger or consolidation; or (5) the Company shall have sold to another person (i) substantially all of the Company's assets or (ii) the Bank. The term "person" refers to an individual, corporation, partnership, trust, association, joint venture, pool, syndicate, sole proprietorship, unincorporated organization or other entity. (g) "Code" means the Internal Revenue Code of 1986, as amended, and regulations promulgated thereunder. (h) "Committee" means the committee of the Board described in Article 4. (i) "Covered Employee" means an Employee who is a "covered employee" within the meaning of Section 162(m) of the Code. (j) "Deferred Compensation Account" means the bookkeeping account established for each Participant pursuant to Section 12.2 of this Plan. (k) "Disability" shall have the meaning set forth in Section 22(e)(3) of the Code. (l) "Distribution Event" means an event as a result of which a Participant is entitled to receive the balance of his or her Deferred Compensation Account pursuant to Section 12.3 of this Plan, namely (i) with respect to a Participant who is an employee of the Company and the portion of his or her Deferred Compensation Account attributable to an Award or other compensation earned as an employee, the date the Participant terminates his or her employment with the Company, and (ii) with respect a Participant who is a member of the Board and the portion of his or her Deferred Compensation Account attributable to an Award or other compensation earned as a member of the Board, the earlier of (A) the date the Participant terminates his or her service as a member of the Board, or (B) the Participant's attainment of the age specified (not younger than age 55) in an election form filed by the Participant with the Committee at such time as he or she first becomes eligible to defer compensation pursuant to Article 12 of this Plan. 2 (m) "Exchange Act" means the Securities Exchange Act of 1934, as amended, and the regulations promulgated thereunder. (n) "Fair Market Value" means, as of any given date, the fair market value of Stock on a particular date determined in accordance with the requirements of Section 422 of the Code. (o) "Incentive Stock Option" means an Option that is intended to meet the requirements of Section 422 of the Code or any successor provision thereto. (p) "Non-Employee Director" means a member of the Board who qualifies as a "Non-Employee Director" as defined in Rule 16b-3(b)(3) under the Exchange Act, or any successor definition adopted by the Board. (q) "Non-Qualified Stock Option" means an Option that is not intended to be an Incentive Stock Option. (r) "Option" means a right granted to a Participant under Article 7 of the Plan to purchase Stock at a specified price during specified time periods. An Option may be either an Incentive Stock Option or a Non-Qualified Stock Option. (s) "Participant" means a person who, as a member of the Board, an employee, officer, or executive of the Company, has been granted an Award under the Plan, or who has been designated as eligible to make an election to defer compensation under this Plan. (t) "Performance-Based Awards" means Stock Awards granted to selected Covered Employees pursuant to Article 9, but which are subject to the terms and conditions set forth in Article 10. All Performance-Based Awards are intended to qualify as "performance-based compensation" under Section 162(m) of the Code. (u) "Performance Criteria" means the criteria that the Committee selects for purposes of establishing the Performance Goal or Performance Goals for a Participant for a Performance Period. The Performance Criteria that will be used to establish Performance Goals may include, but shall not be limited to, one or more of the following: pre- or after-tax net earnings, sales growth, operating earnings, operating cash flow, working capital, return on net assets, return on stockholders' equity, return on assets, return on capital, Stock price growth, stockholder returns, gross or net profit margin, earnings per share, price per share of Stock, and market share, any of which may be measured either in absolute terms or as compared to any incremental increase or as compared to results of a peer group. The Committee shall, within the time prescribed by Section 162(m) of the Code, define in an objective fashion the manner of calculating the Performance Criteria it selects to use for such Performance Period for such Participant. (v) "Performance Goals" means, for a Performance Period, the goals established in writing by the Committee for the Performance Period based upon the Performance Criteria. Depending on the Performance Criteria used to establish such Performance Goals, the Performance Goals may be expressed in terms of overall Company performance or the performance of a division, business unit, or an individual. The Committee, in its discretion, may, within the time prescribed by Section 162(m) of the Code, adjust or modify the calculation of Performance Goals for such Performance Period in order to prevent the dilution or enlargement of the rights of Participants (i) in the event of, or in anticipation of, any unusual or extraordinary corporate item, transaction, event, or development, or (ii) in recognition of, or in anticipation of, any other unusual or nonrecurring events affecting the Company, or the financial statements of the Company, or in response to, or in anticipation of, changes in applicable laws, regulations, accounting principles, or business conditions. (w) "Performance Period" means the one or more periods of time, which may be of varying and overlapping durations, as the Committee may select, over which the attainment of one or more Performance Goals will be measured for the purpose of determining a Participant's right to, and the payment of, a Performance-Based Award. 3 (x) "Plan" means the PVF Capital Corp. 2000 Incentive Stock Option and Deferred Compensation Plan (formerly known as the "PVF Capital Corp. 2000 Incentive Stock Option Plan"), as set forth herein. (y) "Restricted Stock Award" means Stock granted to a Participant under Article 9 that is subject to certain restrictions and to risk of forfeiture. (z) "Stock" means the common stock of the Company and such other securities of the Company that may be substituted for Stock pursuant to Article 13. (aa) "Stock Appreciation Right" or "SAR" means a right granted to a Participant under Article 8 to receive a payment equal to the difference between the Fair Market Value of a share of Stock as of the date of exercise of the SAR over the grant price of the SAR, all as determined pursuant to Article 8. (bb) "Stock Award" means a Restricted Stock Award or an Unrestricted Stock Award. (cc) "Unrestricted Stock Award" means Stock granted to a Participant under Article 9 that is not subject to restrictions or a risk of forfeiture. ARTICLE 4 ADMINISTRATION 4.1 COMMITTEE. The Plan shall be administered by a Committee appointed by, and which serves at the discretion of, the Board. The Committee shall consist of at least two individuals, each of whom qualifies as a Non-Employee Director. To the extent necessary or desirable each member of the Committee shall also qualify as an "outside director" under Code Section 162(m) and the regulations issued thereunder. The members of the Committee shall meet such additional criteria as may be necessary or desirable to comply with regulatory or stock exchange rules or exemptions. The Company will pay all reasonable expenses of the Committee. 4.2 AUTHORITY OF COMMITTEE. Subject to any specific designation in the Plan, the Committee has the exclusive power, authority and discretion to: (a) Designate Participants to receive Awards; (b) Determine the type or types of Awards to be granted to each Participant; (c) Determine the number of Awards to be granted and the number of shares of Stock to which an Award will relate; (d) Determine the terms and conditions of any Award granted under the Plan including but not limited to, the exercise price, grant price, or purchase price, any restrictions or limitations on the Award, any schedule for lapse of forfeiture restrictions or restrictions on the exercisability of an Award, and accelerations or waivers thereof, based in each case on such considerations as the Committee in its sole discretion determines; (e) Amend, modify, or terminate any outstanding Award, with the Participant's consent unless the Committee has the authority to amend, modify, or terminate an Award without the Participant's consent under any other provision of the Plan. (f) Determine whether, to what extent, and under what circumstances an Award may be settled in, or the exercise price of an Award may be paid in, cash, Stock, other Awards, or other property, or an Award may be canceled, forfeited, or surrendered; (g) Prescribe the form of each Award Agreement, which need not be identical for each Participant; 4 (h) Decide all other matters that must be determined in connection with an Award; (i) Establish, adopt, revise, amend or rescind any guidelines, rules and regulations as it may deem necessary or advisable to administer the Plan; and (j) Interpret the terms of, and rule on any matter arising under, the Plan or any Award Agreement; (k) Make all other decisions and determinations that may be required under the Plan or as the Committee deems necessary or advisable to administer the Plan, including but not limited to, the determination of whether and to what extent any Performance Goals have been achieved; and (l) Retain counsel, accountants and other consultants to aid in exercising its powers and carrying out its duties under the Plan. 4.3 DECISIONS BINDING. The Committee's interpretation of the Plan, any Awards granted under the Plan, any Award Agreement and all decisions and determinations by the Committee with respect to the Plan shall be final, binding, and conclusive on all parties and any other persons claiming an interest in any Award or under the Plan. ARTICLE 5 SHARES SUBJECT TO THE PLAN 5.1 NUMBER OF SHARES. Subject to adjustment provided in Section 13.1, the aggregate number of shares of Stock reserved and available for grant under the Plan shall be two hundred and fifty thousand (250,000). 5.2 LAPSED AWARDS. To the extent that an Award terminates, is cancelled, expires, lapses or is forfeited for any reason, including, but not limited to, the failure to achieve any Performance Goals, any shares of Stock subject to the Award will again be available for the grant of an Award under the Plan. 5.3 STOCK DISTRIBUTED. Any Stock distributed pursuant to an Award may consist, in whole or in part, of authorized and unissued Stock, treasury Stock or Stock purchased on the open market. 5.4 LIMITATION ON NUMBER OF SHARES SUBJECT TO AWARDS. Notwithstanding any provision in the Plan to the contrary, and subject to the adjustment in Section 13.1, the maximum number of shares of Stock with respect to Options and Stock Appreciation Rights that may be granted to any one Participant during the Company's fiscal year shall be twenty-five thousand (25,000). ARTICLE 6 ELIGIBILITY AND PARTICIPATION 6.1 ELIGIBILITY. Persons eligible to participate in this Plan include all members of the Board and any key executive of the Company (which term shall be deemed to include among others, the president, any vice president, secretary, treasurer or any manager in charge of a principal business unit, division or function (such as sales, administration or finance), any other officer who performs a policy making function, or any other person who performs similar policy making functions for the Company or any of its subsidiaries) and who on the date of any Award is in the employ of the Company or one of its then subsidiary corporations, as defined in Section 424 of the Code. 6.2 ACTUAL PARTICIPATION. Subject to the provisions of the Plan, the Committee may, from time to time, select from among all eligible individuals, those to whom Awards shall be granted and shall determine the nature and amount of each Award. No individual shall have any right to be granted an Award under this Plan. 5 ARTICLE 7 STOCK OPTIONS 7.1 GENERAL. The Committee is authorized to grant Options to Participants on the following terms and conditions: (a) EXERCISE PRICE. The exercise price per share of Stock under an Option shall be the Fair Market Value as of the date of grant. (b) TIME AND CONDITIONS OF EXERCISE. Except as provided herein, the Committee shall determine the time or times at which an Option may be exercised in whole or in part. The Committee shall also determine the performance or other conditions, if any, that must be satisfied before all or part of an Option may be exercised; provided, however, in no event shall an Option granted to a Participant who is not a member of the Board be exercisable before the Participant has completed one year of continued employment or service with the Company. An Option will lapse immediately if a Participant's employment or services are terminated for Cause. (1) The Option of any Participant whose employment is terminated for any reason, other than for death, Disability or Cause shall be exercisable to the extent provided therein, through the earlier of the date which is three months after termination of employment or the date that such Option expires in accordance with its terms, and shall expire thereafter. (2) In the event of the death of a Participant while an employee of the Company or within three months after the termination of employment of the Participant for other than Cause, or in the event of the termination of employment by a Participant for Disability, the Option may be exercised as follows: (A) In the event of the death of a Participant during employment or the death of the Participant within three months after the termination of employment for other than Cause, each Option granted to such Participant shall be exercisable to the extent provided therein but not later than one year after his or her death (but not beyond the stated duration of the Option). Any such exercise shall be made only by or to the executor or administrator of the estate of the deceased Participant or person or persons to whom the deceased Participant's rights under the Option shall pass by will or the laws of descent and distribution and to the extent, if any, that the deceased Participant was entitled at the date of his or her death. (B) In the case of a Participant whose employment is terminated on account of Disability, the Option shall be exercisable or payable to the extent provided therein on the earlier of one year after termination of employment or the date that such Option expires in accordance with its terms. During such period, the Option may be exercised by the Participant with respect to the same number of shares, in the same manner and to the same extent as if the Participant had continued employment during such period. (3) Each Option granted under the Plan shall, by its terms, not be transferable otherwise than by will or the laws of descent and distribution. Notwithstanding the foregoing, or any other provision of this Plan, a Participant who holds Options may transfer such Options (but not Incentive Stock Options) to his or her spouse, lineal ascendants, lineal descendants, or to a duly established trust for the benefit of one or more of these individuals. Options so transferred may thereafter be transferred only to the Participant who originally received the grant or to an individual or trust to whom the Participant could have initially transferred the Options pursuant to this Section 7.1(b)(3). Options which are transferred pursuant to this Section 7.1(b)(3) shall be exercisable by the transferee according to the same terms and conditions as applied to the Participant. (4) For the purposes of this Section, Options granted to directors may be exercised at any time prior to the expiration date of the Option. In the event of the death of the director, Options may be exercised at any time prior to the expiration date of the option. Any such exercise or payment shall be made only by or to the executor or administrator of the estate of the deceased Director or person or persons to whom the deceased Director's rights under the Option shall pass by will or the laws of descent and distribution and to the extent, if any, that the deceased Director was entitled at the date of his or her death. 6 (c) PAYMENT. An Option shall be exercised by giving a written notice to the President of the Company stating the number of shares of Stock with respect to which the Option is being exercised and containing such other information as the President may request and by tendering payment therefore with a cashier's check, certified check, or with existing holdings of Common Stock held for more than six months. (d) EVIDENCE OF GRANT. All Options shall be evidenced by an Award Agreement. The Award Agreement shall include such additional provisions as may be specified by the Committee. 7.2 INCENTIVE STOCK OPTIONS. Incentive Stock Options shall be granted only to employees and the terms of any Incentive Stock Options granted under the Plan must comply with the following additional rules: (a) EXERCISE PRICE. The exercise price per share of Stock shall be set by the Committee, provided that the exercise price for any Incentive Stock Option may not be less than the Fair Market Value as of the date of the grant. (b) EXERCISE. In no event, may any Incentive Stock Option be exercisable for more than ten years from the date of its grant. (c) LAPSE OF OPTION. An Incentive Stock Option shall lapse under the following circumstances. (1) The Incentive Stock Option shall lapse ten years from the date it is granted, unless an earlier time is set in the Award Agreement. (2) The Incentive Stock Option shall lapse upon termination of employment for Cause or for any other reason, other than the Participant's death or Disability, unless otherwise provided in the Award Agreement. (3) If the Participant terminates employment on account of Disability or death before the Option lapses pursuant to paragraph (1) or (2) above, the Incentive Stock Option shall lapse, unless it was previously exercised, on the earlier of (i) the date on which the Option would have lapsed had the Participant not become Disabled or lived and had his employment status (i.e., whether the Participant was employed by the Company on the date of his Disability or death or had previously terminated employment) remained unchanged; or (ii) 12 months after the date of the Participant's termination of employment on account of Disability or death. (d) INDIVIDUAL DOLLAR LIMITATION. The aggregate Fair Market Value (determined as of the time an Award is made) of all shares of Stock with respect to which Incentive Stock Options are first exercisable by a Participant in any calendar year may not exceed $100,000.00 or such other limitation as imposed by Section 422(d) of the Code, or any successor provision. To the extent that Incentive Stock Options are first exercisable by a Participant in excess of such limitation, the excess shall be considered Non-Qualified Stock Options. (e) TEN PERCENT OWNERS. An Incentive Stock Option shall be granted to any individual who, at the date of grant, owns stock possessing more than ten percent of the total combined voting power of all classes of Stock of the Company only if such Option is granted at a price that is not less than 110% of Fair Market Value on the date of grant and the Option is exercisable for no more than five years from the date of grant. (f) RIGHT TO EXERCISE. During a Participant's lifetime, an Incentive Stock Option may be exercised only by the Participant. 7 ARTICLE 8 STOCK APPRECIATION RIGHTS 8.1 GRANT OF SARS. The Committee is authorized to grant SARs to Participants on the following terms and conditions: (a) RIGHT TO PAYMENT. Upon the exercise of a Stock Appreciation Right, the Participant to whom it is granted has the right to receive the excess, if any, of: (1) The Fair Market Value of a share of Stock on the date of exercise; over (2) The grant price of the Stock Appreciation Right as determined by the Committee, which shall not be less than the Fair Market Value of a share of Stock on the date of grant in the case of any SAR related to any Incentive Stock Option. (b) OTHER TERMS. All such Awards shall be evidenced by an Award Agreement. The terms, methods of exercise, methods of settlement, form of consideration payable in settlement, and any other terms and conditions of any Stock Appreciation Right shall be determined by the Committee at the time of the grant of the Award and shall be reflected in the Award Agreement. ARTICLE 9 STOCK AWARDS 9.1 GRANT OF STOCK. The Committee is authorized to grant Unrestricted Stock Awards and Restricted Stock Awards to Participants in such amounts and subject to such terms and conditions as determined by the Committee. All such Awards shall be evidenced by an Award Agreement. 9.2 ISSUANCE AND RESTRICTIONS. An Unrestricted Stock Award may provide for a transfer of shares of Stock to a Participant at the time the Award is granted, or it may provide for a deferred transfer of shares of Stock subject to conditions prescribed by the Committee. Restricted Stock Awards shall be subject to such restrictions on transferability and risks of forfeiture as the Committee may impose. These restrictions and risks may lapse separately or in combination at such times, under such circumstances, in such installments, or otherwise, as the Committee determines at the time of the grant of the Award or thereafter. 9.3 FORFEITURE. Except as otherwise determined by the Committee at the time of the grant of the Award or thereafter, upon termination of employment during the applicable restriction period, Stock subject to a Restricted Stock Award that is at that time subject to restrictions shall be forfeited, provided, however, that the Committee may provide in any Restricted Stock Award that restrictions or forfeiture conditions relating to the Stock will be waived in whole or in part in the event of terminations resulting from specified causes, and the Committee may in other cases waive in whole or in part restrictions or forfeiture conditions relating to the Stock. 9.4 CERTIFICATES FOR RESTRICTED STOCK. Restricted Stock Awards granted under the Plan may be evidenced in such manner as the Committee shall determine. If certificates representing shares of Stock subject to Restricted Stock Awards are registered in the name of the Participant, certificates must bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such shares, and the Company may, at its discretion, retain physical possession of the certificate until such time as all applicable restrictions lapse. ARTICLE 10 PERFORMANCE-BASED AWARDS 10.1 PURPOSE. The purpose of this Article 10 is to provide the Committee the ability to qualify the Awards under Article 9 as "performance-based compensation" under Section 162(m) of the Code. If the Committee, in its discretion, decides to grant a Performance-Based Award to a Covered Employee, the provisions of this Article 10 shall control over any contrary provision contained in Article 10. 8 10.2 APPLICABILITY. This Article 10 shall apply only to those Covered Employees selected by the Committee to receive Performance-Based Awards. The Committee may, in its discretion, grant Stock Awards to Covered Employees that do not satisfy the requirements of this Article 10. The designation of a Covered Employee as a Participant for a Performance Period shall not in any manner entitle the Participant to receive an Award for the period. Moreover, designation of a Covered Employee as a Participant for a particular Performance Period shall not require designation of such Covered Employee as a Participant in any subsequent Performance Period and designation of one Covered Employee as a Participant shall not require designation of any other Covered Employees as a Participant in such period or in any other period. 10.3 DISCRETION OF COMMITTEE WITH RESPECT TO PERFORMANCE AWARDS. With regard to a particular Performance Period, the Committee shall have full discretion to select the length of such Performance Period, the type of Performance-Based Awards to be issued, the kind and/or level of the Performance Goal, and whether the Performance Goal is to apply to the Company or any division or business unit thereof. 10.4 PAYMENT OF PERFORMANCE-BASED AWARDS. Unless otherwise provided in the relevant Award Agreement, a Participant must be employed by the Company on the last day of the Performance Period to be eligible for a Performance-Based Award for such Performance Period. In determining the actual size of an individual Performance-Based Award, the Committee may reduce or eliminate the amount of the Performance-Based Award earned for the Performance Period, if in its sole and absolute discretion, such reduction or elimination is appropriate. 10.5 SHAREHOLDER APPROVAL. The Board shall disclose to the shareholders of the Company the material terms of any Performance - Based Award, and shall seek approval of the shareholders of the Performance - Based Award before any Stock is transferred to a Participant, or before any restrictions with respect to same lapse, pursuant to such Award. The Committee shall certify that the Performance Goals with respect to any Performance - Based Award have been achieved before any Stock is transferred to a Participant, or before any restrictions with respect to same lapse. Such disclosure, approval and certification shall be effected in accordance with the requirements of Section 162(m)(4)(C) of the Code. ARTICLE 11 PROVISIONS APPLICABLE TO AWARDS 11.1 STAND-ALONE AND TANDEM AWARDS. Awards granted under the Plan may, in the discretion of the Committee, be granted either alone, in addition to, or in tandem with, any other Award granted under the Plan. Awards granted in addition to or in tandem with other Awards may be granted either at the same time as or at a different time from the grant of such other Awards. 11.2 EXCHANGE PROVISIONS. The Committee may at any time offer to exchange or buy out any previously granted Award for a payment in cash, Stock, or another Award, based on the terms and conditions the Committee determines and communicates to the Participant at the time the offer is made. 11.3 TERM OF AWARD. The term of each Award shall be for the period as determined by the Committee, provided that in no event shall the term of any Incentive Stock Option or a Stock Appreciation Right granted in tandem with the Incentive Stock Option exceed a period of ten years from the date of its grant. 11.4 LIMITS ON TRANSFER. No right or interest of a Participant in any Award may be pledged, encumbered, or hypothecated to or in favor of any party other than the Company, or shall be subject to any lien, obligation, or liability of such Participant to any other party other than the Company. No Award shall be assignable or transferable by a Participant other than by will or the laws of descent and distribution, except that the Committee, in its discretion, may permit a Participant to make a gratuitous transfer of an Award that is not an Incentive Stock Option to his or her spouse, lineal descendants, lineal ascendants, or a duly established trust for the benefit of one or more of these individuals. 11.5 BENEFICIARIES. Notwithstanding Section 11.4, a Participant may, in the manner determined by the Committee, designate a beneficiary to exercise the rights of the Participant and to receive any distribution 9 with respect to any Award upon the Participant's death. A beneficiary, legal guardian, legal representative, or other person claiming any rights under the Plan is subject to all terms and conditions of the Plan and any Award applicable to the Participant, except to the extent the Plan and Award otherwise provide, and to any additional restrictions deemed necessary or appropriate by the Committee. If no beneficiary has been designated or survives the Participant, payment shall be made to the Participant's estate. Subject to the foregoing, a beneficiary designation may be changed or revoked by a Participant at any time provided the change or revocation is filed with the Committee. 11.6 STOCK CERTIFICATES. Notwithstanding anything herein to the contrary, the Company shall not be required to issue or deliver any certificates evidencing shares of Stock pursuant to the exercise of any Awards, unless and until the Board has determined, with advice of counsel, that the issuance and delivery of such certificates is in compliance with all applicable laws, regulations of governmental authorities and, if applicable, the requirements of any exchange on which the shares of Stock are listed or traded. All Stock certificates delivered under the Plan are subject to any stop-transfer orders and other restrictions as the Committee deems necessary or advisable to comply with Federal, state, or foreign jurisdiction, securities or other laws, rules and regulations and the rules of any national securities exchange or automated quotation system on which the Stock is listed, quoted, or traded. The Committee may place legends on any Stock certificate to reference restrictions applicable to the Stock. In addition to the terms and conditions provided herein, the Board may require that a Participant make such reasonable covenants, agreements, and representations as the Board, in its discretion, deems advisable in order to comply with any such laws, regulations, or requirements. 11.7 LOAN AGREEMENTS. Each Award shall be subject to the condition that the Company shall not be obligated to issue or transfer any Stock or cash to the holder of the Award, upon the exercise or vesting thereof, if at any time the Committee or the Board shall determine that the issuance or transfer of such Stock or cash would be in violation of any covenant in any of the Company's loan agreements or other contracts. ARTICLE 12 DEFERRAL OF COMPENSATION 12.1 RIGHT TO DEFER COMPENSATION. (a) TYPES OF DEFERRALS. Any Participant designated by the Board or by the Committee may elect to defer (i) all or any portion of the Participant's salary, (ii) any percentage of a fiscal year bonus determined by the Board or other duly constituted authority or delegate to be paid to such Participant, or (iii) all or any portion of the Participant's director's fees. Such election shall remain in force for all future years until modified or revoked. In addition, the Committee, in its discretion, may permit a Participant to elect to defer his or her receipt of the payment of cash or the delivery of shares of Stock that would otherwise be due to such Participant pursuant to an Award. Any election under this Section 12.1 shall be made by written notice delivered to the Board or Committee, specifying the amount (or percentage) of salary and/or bonus and/or directors' fees and/or the award to be deferred. (b) TIMING OF ELECTIONS. A Participant may, at any time within 30 days of first becoming eligible to participate in this Plan, make an election to defer salary or director's fees earned after such election. Any increase or decrease in future deferrals of salary or director's fees earned during a calendar year must be made by December 1 of the preceding calendar year. A Participant may make an initial election to defer a bonus for a fiscal year, or may elect to increase or decrease the amount of a fiscal year bonus to be deferred, if such election is made by June 1 of the preceding fiscal year; provided, however, that a Participant may make an election to defer up to fifty percent (50%) of a bonus for the fiscal year ending June 30, 2004 if such election is made by December 1, 2003. A Participant may make an election to defer the receipt of cash or shares of Stock otherwise payable or transferable to the Participant pursuant to an Award in accordance with the terms of such Award. 10 12.2 DEFERRED COMPENSATION ACCOUNTS. (a) ESTABLISHMENT OF ACCOUNTS. A Deferred Compensation Account in the name of each Participant who has elected to defer compensation under the Plan shall be established and maintained as a special ledger account on the books of the Company. On the last day of each calendar month in which salary or director's fees deferred under this Plan would have become payable to a Participant (in the absence of an election to defer payment thereof), the amount of such deferred salary or director's fees shall be credited to the Participant's Deferred Compensation Account. On the last day of the month in which the bonuses deferred under this Plan would have become payable to a Participant in the absence of an election to defer payment thereof, the amount of such deferred bonus shall be credited to the Participant's Deferred Compensation Account. On the last day of the month in which an Award would have otherwise become payable or transferable to a Participant in the absence of an election to defer receipt thereof, the amount of such deferred Award shall be credited to the Participant's Deferred Compensation Account. (b) DEEMED INVESTMENT OF ACCOUNT BALANCE. (i) Except as otherwise provided by the terms of an Award, the Participant shall, at the time of making a deferred compensation election under this Plan, make an election directing the Company to credit to the Deferred Compensation Account in that calendar year based upon the options made available by the Board or designated Committee which options may include either cash, Stock, or a combination of cash and Stock equal in value to the amount of the current year's salary or bonus deferred under the Plan. In addition to cash or Stock, the Board or the Committee may offer to the Participant such deemed investment options as it shall decide are appropriate. Such investment options may include deemed investments in individual stocks or bonds, mutual funds, and such other investment options as the Board or Committee may choose. The Board or Committee shall not be required to offer the same deemed investment options to each Participant but may restrict certain investment options to designated Participants. In the absence of a contrary election by a Participant, the amount credited to a Deferred Compensation Account shall be credited as cash. (ii) If the Participant directs that any amount credited to the Deferred Compensation account be credited in the form of Stock, the Board shall credit to the Deferred Compensation Account sufficient shares of Stock equal in value to the Deferred Compensation Account balance, or such lesser amount as the Participant shall direct. The value of such Stock shall be determined in accordance with a valuation methodology approved by the Board or by the Committee. Except as provided in Section 12.6, such Stock credited to the Deferred Compensation Account shall merely constitute a bookkeeping entry of the Company, and (except as provided herein) the Participant shall have no voting, dividend, or other legal or economic rights with respect to such Stock. At the end of each fiscal quarter, an amount equivalent to all dividends which would otherwise have been payable with respect to such Stock shall be credited to the Deferred Compensation Account as additional Stock. The amount of the Participant's Deferred Compensation Account that is credited as cash shall accrue interest at a rate no less than the prime rate charged the Company by its principal bank and shall not exceed the highest rate paid on Individual Retirement Accounts ("IRAs") by the Bank plus two percent (2%). Such interest with respect to a Deferred Compensation Account shall be credited to such account quarterly, based on the weighted average daily prime rate or the IRA rate for the three (3) month period ending on the last day of the quarter. (ii) The Participant shall elect the portion of their deferral to be allocated to Stock or cash or such other option as made available by the Board at the time of making such election to defer compensation. Such allocation may not be amended with respect to such deferral. Any allocation to Stock shall be paid in the form of Stock. No Participant will be granted the right to take payment of the Stock in cash rather than in shares. (iii) If, at any time, the deferral of a Participant is allocated to Stock, and such Participant shall be deemed to have violated the short-swing profit rules of Section 16(b) of the Exchange Act through such allocation, the allocation to Stock shall be void and such allocation shall default to cash. 11 12.3 PAYMENT OF DEFERRED COMPENSATION. (a) IN GENERAL. Amounts credited to a Participant's Deferred Compensation Account shall be payable upon the Participant's Distribution Event. The Participant shall determine the method of distributing the amounts in the Deferred Compensation Account at the time the first election to participate in the Plan is made, which shall be either a single distribution or a series of up to ten (10) consecutive, substantially equal annual installments paid to such Participant or his or her beneficiary, as the case may be, on or before January 15 of each year, commencing in the year following the Distribution Event. If no such election is made, the method of distribution shall be determined solely by the Board. If the Participant has elected to receive installment distributions, and less than the full value of the Participant's Deferred Compensation Account balance has been distributed as of the date of his or her death, the balance shall be paid to the Participant's beneficiary in accordance with the same method in effect at the Participant's death, except that the beneficiary may elect, with the consent of the Committee, to receive the balance of the Deferred Compensation Account in a single lump sum. For purposes of this Article 12, a Participant's "beneficiary" shall mean the person or persons designated by the Participant pursuant to Section 11.5 of this Plan, or, in the absence of such designation or if no such person survives the Participant, the Participant's estate. If any portion of the Participant's Deferred Compensation Account is credited with Stock, then distributions from that portion of the Deferred Compensation Account shall be made directly in the form of Stock. Undistributed amounts shall continue to earn interest or accrue dividends, as the case may be. (b) MODIFICATION OF PAYMENT TERMS. A Participant may change a Distribution Election at any time at least sixty (60) days prior to a Distribution Event. If a Participant electing to participate in the Plan ceases to be an employee of the Company or a member of the Board, prior to full payment of the entire amount in the Deferred Compensation Account, shall, after reasonable warning from the Board, persist in an affiliation with any business that is a principal competitor with a significant portion of the business conducted by the Company, the entire balance of such Deferred Compensation Account may, if directed by the Board in its sole discretion, be paid immediately to such Participant in a lump sum. In the event a Participant dies prior to receiving payment of the entire amount in the Deferred Compensation Account, the unpaid balance shall be paid to such beneficiary as may have been designated by the Participant in writing to the Company as the person, firm or trust to receive any post-death distribution under this Plan, or, in the absence of such written designation, to the legal representative or any person, firm or organization designated in the Participant's last will to receive such distributions. (c) CHANGE IN CONTROL. In the event of a Change in Control, a Participant shall be permitted to elect to receive a distribution of all or a portion of his or her Deferred Compensation Account, provided that any such election hereunder must be made within the period commencing thirty days prior to such Change in Control and ending on the date of such Change in Control. Any distribution pursuant to this Section 12.3(c) shall be made (i) in the form of cash and/or Stock as his or her Deferred Compensation Account is allocated and (ii) within seven (7) days subsequent to the Change in Control. (d) HARDSHIP DISTRIBUTION IN THE CASE OF FINANCIAL EMERGENCY. Prior to the time a Deferred Compensation Account of a Participant would otherwise become payable, the Committee, in its sole discretion, may elect to distribute all or a portion of the Deferred Compensation Account in the event such Participant requests a distribution by reason of severe financial hardship. For purposes of this Plan, severe financial hardship shall be deemed to exist in the event the Committee determines that a Participant needs a distribution to meet immediate and heavy financial needs resulting from a sudden or unexpected illness or accident of the Participant, or a member of his or her family, loss of the Participant's property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. A distribution based on financial hardship shall not exceed the amount required to meet the immediate financial need created by the hardship. In the event the Participant is a member of the Committee making such determination, the Participant shall not participate in the decision by the Committee. 12.4 TRUST PROVISIONS. (a) ESTABLISHMENT OF TRUST. The Company may in its sole discretion establish one or more trusts to provide a source of payment for its obligations under the Plan and such trust shall be permitted to hold cash, Stock, or other assets to the extent of the Company's obligations hereunder. The Company may, but is 12 not required to, utilize a single trust with respect to its obligations to Participants who are members of the Board and Participants who are not members of the Board. (b) CLAIMS OF THE COMPANY'S CREDITORS. All assets held by any trust created hereunder and all distributions to be made by any trustee pursuant to this Plan and any trust agreement shall be subject to the claims of general creditors of the Company, including judgment creditors and bankruptcy creditors. The rights of a Participant or his or her beneficiaries in or to any assets of the trust shall be no greater than the rights of an unsecured creditor of the Company. (c) NOTIFICATION OF INSOLVENCY. In the event the Company becomes insolvent, the Chief Executive Officer and Chairman of the Board of the Company shall immediately notify the trustees of all trusts created hereunder of that fact. The trustees shall make no distributions to any Participant or any beneficiary from any assets held in trust pursuant to the Plan after such notification is received or at any time after the trustee has actual knowledge that the Company is insolvent. Under any such circumstance, the trustee shall dispose of property held in trust pursuant to the Plan only as a court of competent jurisdiction may direct. For purposes of this Plan, the Company shall be deemed "insolvent" by the trustee if the Company is subject to a pending voluntary or involuntary proceeding as a debtor under the United States Bankruptcy Code, as the same may be amended from time to time, whether or not the Company has provided the trustee with the notification required by this Section 12.4(c), or if the trustee has been notified pursuant to this Section 12.4(c) that the Company is insolvent. 12.5 NON-ASSIGNMENT. No right or interest of any Participant or any person claiming through or under such Participant in the Particiapant's Deferred Compensation Account shall be assignable or transferable in any manner or be subject to alienation, anticipation, sale, pledge, encumbrance or other legal process (including execution, levy, garnishment, attachment, bankruptcy, or otherwise) or in any manner be subject to the debts or liabilities of such Participant. If any Participant or any such person shall attempt to or shall transfer, assign, alienate, anticipate, sell, pledge or otherwise encumber his or her benefits hereunder or any part thereof, or if by reason of his or her bankruptcy or other event happening at any time such benefits would devolve upon anyone else or would not be enjoyed by him or her, then the Committee, in its discretion, may terminate his or her interest in any such benefit to the extent the Committee considers necessary or advisable to prevent or limit the effects of such occurrence. Termination shall be effected by filing a written declaration of termination with the Committee's records and making reasonable efforts to deliver a copy to such Participant or any such other person or his or her legal representative. As long as any Participant is alive, any amounts affected by the termination shall be retained by the Company or the trustee of any trust established pursuant to Section 12.4 of this Plan and, in the Committee's sole and absolute discretion, may be paid to or expended for the benefit of such Participant, his or her spouse, his or her children, or any other person or persons in fact dependent upon him or her in such a manner as the Committee shall deem proper. ARTICLE 13 CHANGES IN CAPITAL STRUCTURE 13.1 GENERAL. (a) SHARES AVAILABLE FOR GRANT. In the event of any change in the number of shares of Stock outstanding by reason of any stock dividend or split, recapitalization, merger, consolidation, combination or exchange of shares or similar corporate change, the maximum aggregate number of shares of Stock with respect to which the Committee may grant Awards shall be appropriately adjusted by the Committee. In the event of any change in the number of shares of Stock outstanding by reason of any other event or transaction, the Committee may, but need not, make such adjustments in the number and class of shares of Stock with respect to which Awards may be granted as the Committee may deem appropriate. (b) OUTSTANDING AWARDS - INCREASE OR DECREASE IN ISSUED SHARES WITHOUT CONSIDERATION. Subject to any required action by the shareholders of the Company, in the event of any increase or decrease in the number of issued shares of Stock resulting from a subdivision or consolidation of shares of Stock or the payment of a stock dividend (but only on the shares of Stock), or any other increase or decrease in the number of such shares effected without receipt or payment of consideration by the Company, the 13 Committee shall proportionally adjust the number of shares of Stock subject to each outstanding Award and the exercise price per share of Stock of each such Award. (c) OUTSTANDING AWARDS - CERTAIN MERGERS. Subject to any required action by the shareholders of the Company, in the event that the Company shall be the surviving corporation in any merger or consolidation (except a merger or consolidation as a result of which the holders of shares of Stock receive securities of another corporation), each Award outstanding on the date of such merger or consolidation shall pertain to and apply to the securities which a holder of the number of shares of Stock subject to such Award would have received in such merger or consolidation. (d) OUTSTANDING AWARDS - CERTAIN OTHER TRANSACTIONS. In the event of (i) a dissolution or liquidation of the Company, (ii) a sale of all or substantially all of the Company's assets, (iii) a merger or consolidation involving the Company in which the Company is not the surviving corporation or (iv) a merger or consolidation involving the Company in which the Company is the surviving corporation but the holders of shares of Stock receive securities of another corporation and/or other property, including cash, the Committee shall, in its absolute discretion, have the power to: (1) cancel, effective immediately prior to the occurrence of such event, each Award outstanding immediately prior to such event (whether or not then exercisable), and, in full consideration of such cancellation, pay to the Participant to whom such Award was granted an amount in cash, for each share of Stock subject to such Award, respectively, equal to the excess of (A) the value, as determined by the Committee in its absolute discretion, of the property (including cash) received by the holder of a share of Stock as a result of such event over (B) the exercise of such Award; or (2) provide for the exchange of each Award outstanding immediately prior to such event (whether or not then exercisable) for an option, a stock appreciation right, restricted stock award, performance share award or performance-based award with respect to, as appropriate, some or all of the property for which such Award is exchanged and, incident thereto, make an equitable adjustment as determined by the Committee in its absolute discretion in the exercise price or value of the option, stock appreciate right, restricted stock award, performance share award or performance-based award or the number of shares or amount of property subject to the option, stock appreciation right, restricted stock award, performance share award or performance-based award or, if appropriate, provide for a cash payment to the Participant to whom such Award was granted in partial consideration for the exchange of the Award, or any combination thereof. (e) OUTSTANDING AWARDS - OTHER CHANGES. In the event of any other change in the capitalization of the Company or corporate change other than those specifically referred to in this Article, the Committee may, in its absolute discretion, make such adjustments in the number and class of shares subject to Awards outstanding on the date on which such change occurs and in the per share exercise price of each Award as the Committee may consider appropriate to prevent dilution or enlargement of rights. (f) NO OTHER RIGHTS. Except as expressly provided in the Plan, no Participant shall have any rights by reason of any subdivision or consolidation of shares of stock of any class, the payment of any dividend, any increase or decrease in the number of shares of stock of any class or any dissolution, liquidation, merger, or consolidation of the Company or any other corporation. Except as expressly provided in the Plan, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number of shares of Stock subject to an Award or the exercise price of any Award. ARTICLE 14 AMENDMENT, MODIFICATION, AND TERMINATION 14.1 AMENDMENT, MODIFICATION, AND TERMINATION. At any time and from time to time, the Board may terminate, amend or modify the Plan; provided, however, that the Board shall not, without the affirmative vote of the holder of a majority of the voting stock of the Company, make any amendment which would (i) abolish the Committee without designating such other committee, change the qualifications of its members, or withdraw the administration of the Plan from its supervision, (ii) increase the maximum number of shares of Stock 14 for which Awards may be granted under the Plan, (iii) amend the formula for determination of the exercise price Options, (iv) extend the term of the Plan, and (v) amend the requirements as to the employees eligible to receive Awards; and further provided that no other amendment shall be made without shareholder approval to the extent necessary or desirable to comply with any applicable law, regulations or stock exchange rule. 14.2 AWARDS PREVIOUSLY GRANTED. Except as otherwise provided in the Plan, including without limitation, the provisions of Article 13, no termination, amendment, or modification of the Plan shall adversely affect in any material way any Award previously granted under the Plan, without the written consent of the Participant. ARTICLE 15 GENERAL PROVISIONS 15.1 NO RIGHTS TO AWARDS. No Participant, employee, or other person shall have any claim to be granted any Award under the Plan, and neither the Company nor the Committee is obligated to treat Participants, employees, and other persons uniformly. 15.2 NO STOCKHOLDERS RIGHTS. No Award gives the Participant any of the rights of a stockholder of the Company unless and until shares of Stock are in fact issued to such person in connection with such Award. 15.3 WITHHOLDING. The Company shall have the authority and the right to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy Federal, state, and local taxes (including the Participant's FICA obligation) required by law to be withheld with respect to any taxable event arising as a result of this Plan. A Participant may elect to have the Company withhold from those Stock that would otherwise be received upon the exercise of any Option, a number of shares having a Fair Market Value equal to the minimum statutory amount necessary to satisfy the Company's applicable federal, state, local and foreign income and employment tax withholding obligations. 15.4 NO RIGHT TO EMPLOYMENT OR SERVICES. Nothing in the Plan or any Award Agreement shall interfere with or limit in any way the right of the Company to terminate any Participant's employment or services at any time, nor confer upon any Participant any right to continue in the employ of the Company. 15.5. INDEMNIFICATION. To the extent allowable under applicable law, each member of the Committee or of the Board shall be indemnified and held harmless by the Company from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by such member in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action or failure to act under the Plan and against and from any and all amounts paid by him or her in satisfaction of judgment in such action, suit, or proceeding against him or her provided he or she gives the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company's Articles of Incorporation or Bylaws, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless. 15.6 FRACTIONAL SHARES. No fractional shares of stock shall be issued and the Committee shall determine, in its discretion, whether cash shall be given in lieu of fractional shares or whether such fractional shares shall be eliminated by rounding up or down as appropriate. 15.7 GOVERNMENT AND OTHER REGULATIONS. The obligation of the Company to make payment of awards in Stock or otherwise shall be subject to all applicable laws, rules, and regulations, and to such approvals by government agencies as may be required. The Company shall be under no obligation to register under the Securities Act of 1933, as amended, any of the shares of Stock paid under the Plan. If the shares paid under the Plan may in certain circumstances be exempt from registration under the Securities Act of 1933, as amended, the 15 Company may restrict the transfer of such shares in such manner as it deems advisable to ensure the availability of any such exemption. 15.8 GOVERNING LAW. The Plan and the terms of all Awards shall be construed in accordance with and governed by the laws of the State of Ohio. 16 EX-13 5 l02888aexv13.txt EX-13 PVF ANNUAL REPORT Exhibit 13 [PHOTO] [PVF CAPITAL CORP. LOGO] ------------------------ Annual Report - June 30, 2003 TABLE OF CONTENTS ------------------------------------------------------------------- Letter to Shareholders 1 Park View Federal - A Family Tradition 3 Selected Consolidated Financial and Other Data 6 Management's Discussion and Analysis of Financial Condition and Results of Operations 8 Independent Auditors' Report 21 [PVF CAPITAL CORP. LOGO] ---------------------------------------------------------------------- TO OUR SHAREHOLDERS We are pleased to report that PVF Capital Corp. achieved record operating results for the year ended June 30, 2003. Earnings were $8.1 million, or $1.27 basic earnings per share and $1.25 diluted earnings per share. Return on average assets was 1.15 percent and return on average common equity was 14.60 percent for the year. The Company's consolidated assets increased by $63.8 million, or 9.4 percent, to $743.4 million, while total stockholders' equity increased by $6.3 million, or 12.0 percent, to $58.6 million at June 30, 2003. In addition, the loan portfolio grew by $38.0 million, or 6.6 percent, and deposits increased by $46.7 million, or 9.7 percent, for the year ended June 30, 2003. During a challenging period of sharply declining and historically low market interest rates, the Company was able to improve its interest rate spread from 2.95 percent for the year ended June 30, 2002 to 3.13 percent for the year ended June 30, 2003. Due to the efforts of our branch personnel and a strong staff of branch managers, we were able to close a record total of $646.2 million in mortgage loans for the year. In addition, the Company sold $453.7 million in fixed-rate mortgage loans and recorded record net profits of $4.9 million on mortgage banking activities for the year. As a result of these sales, the Company was able to increase its mortgage servicing portfolio by $122.4 million to $650.7 million. In July and August 2002, Park View Federal successfully opened two new full-service branch offices in Strongsville and Avon, Ohio. Additionally, in the coming year, Park View Federal is planning to further expand its branch network with the opening of a new full-service branch office in Streetsboro, Ohio. The reconfiguration and growth of our branch network has opened new markets to us in residential, construction, multi-family and commercial real estate lending, and has also increased our ability to attract consumer deposits. We plan to continue our efforts to identify new locations for the further expansion of our branch network. Our stock repurchase program originally announced in June of 1999, to purchase up to 5 percent of the Company's common stock, was expanded in August 2002 to acquire up to an additional 5 percent of the Company's common stock. This plan was renewed for another 12 months in July 2003. Pursuant to this plan and our cash dividend policy, the Company repurchased 343,519 shares, or 5.1 percent, of its common stock through June 30, 2003 and paid a $0.296 per share cash dividend for the year. Continuation of the stock repurchase program and cash dividend policy will be dependent on the Company's financial condition, earnings, capital needs, regulatory requirements and market conditions. In July 2003, the Company declared a 10 percent stock dividend that was paid in August 2003. We welcome a new member to our Board of Directors. Ronald D. Holman, II is a partner in the law firm Cavitch, Familo, Durkin & Frutkin in Cleveland, Ohio. Visit our web site at www.parkviewfederal.com. The site provides information about our products and services, and provides access to current loan and deposit account rates, terms and other information. Our goal is to provide a full line of home banking services to our customers. We would like to thank our shareholders, customers and staff for their continued confidence, contributions and support in helping us achieve yet another successful year. We invite all shareholders to attend our Annual Meeting of Stockholders of PVF Capital Corp. on Monday, October 20, 2003, at PVF Capital Corp.'s Corporate Center, 30000 Aurora Road, Solon, Ohio. We look forward to another successful year of service and dedication to the community, its members, our shareholders and our customers. Sincerely, /s/ John R. Male John R. Male Chairman of the Board and Chief Executive Officer /s/ C. Keith Swaney C. Keith Swaney President 2 PARK VIEW FEDERAL - A FAMILY TRADITION - -------------------------------------------------------------------------------- This past October 9, 2002 was a tremendously sad day for Park View Federal. It marked the end of one employee's 57 years of dedicated service to the bank. It was the day Chairman Emeritus James W. Male passed away. Jim Male was the original driving force behind our bank. Born and raised in Cleveland, Ohio, he was a 1943 graduate of Ohio University. In June of 1945, he left to serve overseas in World War II. He returned home to Cleveland in October of that same year, having earned the Bronze Star. A month later, he began working for Park View Savings and Loan Association, the company founded in 1920 by his father, Nathan C. ("N.C.") Male. N.C. Male had been one of a group of local merchants and businessmen who joined together to form a community building and loan association at the corner of East 93rd Street and Kinsman Avenue in Cleveland. Because the location was near the entrance to Woodland Hills Park, they chose the name Park View Savings and Loan Association. The following year, a sale of stock was completed, and the new institution opened its doors in 1921. The Board of Directors selected N.C. Male as managing officer. [PHOTO] Under N.C.'s leadership, the company survived the Great Depression of the early 1930s, remained solvent, and acquired a federal charter and deposit insurance by 1936. Following the Depression, Park View Savings experienced a period of growth and expansion through World War II and the postwar era. When Jim Male joined Park View in November 1945, as a teller and management trainee, the bank had one office, four employees and approximately $1.5 million in total assets. After serving as a teller, Mr. Male held a variety of other positions; in his words, "whatever became available." During that time he also attended classes at night and earned his law degree from Cleveland Marshall Law School in June of 1951. In 1950, the company became a federal mutual savings and loan and changed its name to Park View Federal Savings and Loan Association of Cleveland, Ohio. By 1954, Jim Male had risen to the office of Executive Vice President and acquired the responsibility of operating the bank. Among his initial accomplishments was the opening of two new branch offices. In 1960, Jim Male was elected managing officer. [PHOTO] Over the next 20 years, Park View Federal continued to grow and prosper. During those years, Jim Male's innovative and forward thinking led to the addition of nine branch offices, including a new main office, and the development of new products and services. Throughout this period, Park View set a precedent for adopting new technologies, beginning with the introduction of the bank's first in-house computer system in 1963. This was also the time when Mr. Male fostered the tradition of personal and community-oriented service that the bank is known for today. 3 PARK VIEW FEDERAL - A FAMILY TRADITION - -------------------------------------------------------------------------------- The 1980s were a pivotal time for savings institutions. Like other area thrifts, Park View had taken advantage of new and expanded regulations and had ventured into new businesses and real estate developments. But deregulation soon led to the S&L crisis of the late 1980s and forced the closing of many of the area's thrift institutions. Park View remained open by taking tighter control, scaling back its business operations, and trimming its branch offices from a high of 16 to 7 locations. Throughout the 1990s, Park View returned to "its roots," honing its niche as a real estate and construction lender. In 1994, the bank began to systematically restructure and expand its branch office network, which was predominantly located on the east side of Cleveland. Branches were closed, others were moved, and new ones were opened all to better serve Park View's customers and to attract new ones. In 1999, consolidations within the local banking community presented Park View with opportunities to begin its expansion to the west side of Cleveland. Whether evolving and growing during prosperous times, or weathering through the tough times to emerge ever stronger, with Jim Male's vision, tenacity, devotion and tireless energy, Park View Federal became the successful company it is today. His goals for Park View were, "to be the best real estate bank anywhere and to do a good job for the customers, employees, and shareholders." Jim Male was always happy to come to work, eager to see what challenges the day had to offer. He had a remarkable way with people and thrived on helping them - whether friends, families, or employees. He understood that people are a company's greatest asset. One of his most notable achievements was taking the company public on the NASDAQ stock exchange on December 30, 1992, having raised the $8.5 million needed to complete the IPO by December 21. Two years later, on October 31, 1994, after shareholder approval, Park View Federal Savings Bank reorganized its corporate structure into PVF Capital Corp., a unitary savings and loan holding company. By the year 2000, accelerated growth spurred the need to consolidate internal operations from two separate locations to one. For many years, it was Jim Male's dream to house all of our administrative, corporate and executive offices "under one roof." In September 2000, the bank acquired a four-story, 55,000 square-foot office building in Solon, Ohio. Following a year of improvements, renovations and updates to the building, Mr. Male achieved his dream with the opening of our new Corporate Center, which now serves as headquarters for management and staff of Park View Federal. The Corporate Center is also home to a full-service, state-of-the-art branch. It was his last great accomplishment and one of which he was most proud. So proud, that he commissioned a watercolor of the building as it would appear in winter, and that image was developed into the company's holiday greeting card. [PHOTO] Park View Federal Corporate Center 4 - -------------------------------------------------------------------------------- For the past 83 years, the managing officer of Park View Federal has always been a member of the Male family. The current Chief Executive Officer is John R. Male, grandson of the first managing officer, N.C. Male. John "Jack" Male had replaced his father, Jim, as President and Chief Operating Officer in July 1986. And with Jim Male's retirement announced in October 2000, Jack was named Chairman and Chief Executive Officer of Park View Federal Savings Bank and PVF Capital Corp. [PHOTO] Jack Male remains committed to carry out his grandfather's, father's, and now his vision for the future of the bank. "At the close of this June 30, 2003, Park View Federal had reached assets of $743.4 million, 15 branches and 198 employees. The restructuring and expansion of our branch network has positively positioned the bank to compete effectively within the rapidly changing financial services industry and has provided a strong foundation for further growth. Our basic strategy remains to function as a niche lender, providing customers a wide range of lending products, collateralized by real estate, that may not be available to them at larger banks. We remain optimistic about the future role of community banks and will continue our efforts to identify new locations for the further growth of our branch network. As we continue to grow, we remain committed to serving the financial needs of our customers and pledge our continued efforts to provide the best personal service to our customers, shareholders, and the communities we serve. My father considered himself a very lucky man who had a great life with no regrets about anything. He would not want to be remembered with sadness. He touched the lives of everyone at Park View and he will be remembered as the happy, inspiring man who envisioned Park View Federal as it is today. This annual report is dedicated to his memory." Building on the Foundation of Service ------------------------------------- [PHOTO] The New Streetsboro Branch Office In the coming year, Park View Federal Savings Bank will open a full-service branch office in the rapidly growing city of Streetsboro, Ohio in Portage County. This new 3,000 square-foot facility on Market Square Drive, just north of State Route 14, will feature ample, convenient parking, drive-in banking facilities, an ATM and a complete array of financial services for the community. The office will be Park View's first office in the expanding Portage County market and will bring the total of the bank's full-service branch office locations to sixteen. Park View Federal prides itself on providing its customers superior service, flexible lending programs, and a full range of deposit accounts and services. Each of our branch managers is actively involved in the communities served. 5 SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA FINANCIAL CONDITION DATA:

At June 30, -------------------------------------------------------- 2003 2002 2001 2000 1999 -------------------------------------------------------- (dollars in thousands) Total assets ......................................... $743,404 $679,620 $736,525 $612,986 $449,201 Loans receivable held for investment, net ............ 579,671 563,550 573,643 513,670 395,551 Loans receivable held for sale, net .................. 33,604 11,680 6,152 10,738 1,772 Mortgage-backed securities held for investment, net .. 2,965 7,297 18,124 1,215 2,951 Cash equivalents and securities ...................... 96,784 69,435 115,607 70,931 35,423 Deposits ............................................. 526,429 479,672 480,532 440,982 331,242 FHLB advances and notes payable ...................... 125,938 129,028 190,567 114,974 66,041 Stockholders' equity ................................. 58,603 52,299 48,006 42,900 38,856 Number of: Real estate loans outstanding ........................ 4,778 4,484 4,431 4,160 3,527 Savings accounts ..................................... 32,081 30,223 30,567 28,915 24,346 Offices .............................................. 15 13 12 11 10

OPERATING DATA:

Year Ended June 30, -------------------------------------------------------- 2003 2002 2001 2000 1999 -------------------------------------------------------- (dollars in thousands except for earnings per share) Interest income ...................................... $ 43,482 $ 48,814 $ 53,962 $ 42,026 $ 35,347 Interest expense ..................................... 20,646 27,060 34,118 23,972 19,863 -------- -------- -------- -------- -------- Net interest income before provision for loan losses ................... 22,836 21,754 19,844 18,054 15,484 Provision for loan losses ............................ 0 558 225 850 0 -------- -------- -------- -------- -------- Net interest income after provision for loan losses .................... 22,836 21,196 19,619 17,204 15,484 Non-interest income .................................. 5,893 3,751 2,600 2,681 5,435 Non-interest expense ................................. 16,509 14,139 12,218 10,410 9,649 -------- -------- -------- -------- -------- Income before federal income taxes ................... 12,220 10,808 10,001 9,475 11,270 Federal income taxes ................................. 4,124 3,635 3,365 3,365 3,163 -------- -------- -------- -------- -------- Net income ........................................... $ 8,096 $ 7,173 $ 6,636 $ 6,312 $ 7,719 ======== ======== ======== ======== ======== Basic earnings per share(1) .......................... $ 1.27 $ 1.12 $ 1.05 $ 0.99 $ 1.20 ======== ======== ======== ======== ======== Diluted earnings per share(1) ........................ $ 1.25 $ 1.09 $ 1.02 $ 0.96 $ 1.15 ======== ======== ======== ======== ========

(1)Adjusted for stock dividends. [PVF CAPITAL CORP. LOGO] 2003 Annual Report 6 OTHER DATA:

At or For the Year Ended June 30, -------------------------------------------------------- 2003 2002 2001 2000 1999 -------------------------------------------------------- Return on average assets ................ 1.15% 1.03% 1.00% 1.21% 1.77% Return on average equity ................ 14.60% 14.19% 14.62% 15.45% 22.21% Interest rate spread .................... 3.13% 2.95% 2.75% 3.21% 3.26% Net interest margin ..................... 3.37% 3.26% 3.09% 3.59% 3.68% Average interest-earning assets to average interest-bearing liabilities .. 108.10% 107.64% 106.45% 107.98% 108.92% Non-accruing loans (> 90 days) and repossessed assets to total assets .... 1.06% 1.23% 0.91% 0.87% 0.85% Stockholders' equity to total assets .... 7.88% 7.70% 6.52% 7.00% 8.65% Ratio of average equity to average assets ........................ 7.86% 7.24% 6.79% 7.80% 7.95% Dividend payout ratio ................... 20.44% 21.42% 20.78% 21.77% 0.00%

BANK REGULATORY CAPITAL RATIOS: Ratio of tangible capital to adjusted total assets ................. 7.73% 7.88% 6.46% 6.68% 7.99% Ratio of core capital to adjusted total assets ................. 7.73% 7.88% 6.46% 6.68% 7.99% Ratio of Tier-1 risk-based capital to risk-weighted assets .................. 10.74% 10.84% 9.56% 9.24% 10.43% Ratio of risk-based capital to risk-weighted assets .................. 11.43% 11.63% 10.26% 10.00% 11.17% [PVF CAPITAL CORP. LOGO] 2003 Annual Report 7 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS GENERAL PVF Capital Corp. ("PVF" or the "Company") is the holding company for Park View Federal Savings Bank ("Park View Federal" or the "Bank"), its principal and wholly-owned subsidiary, and a federally chartered savings bank headquartered in Solon, Ohio. Park View Federal has 15 offices located in Cleveland and surrounding communities, including recently opened branches in Strongsville and Avon, Ohio. An office in Streetsboro, Ohio will open later this year. The Bank's principal business consists of attracting deposits from the general public through its branch offices and investing these funds in loans secured by first mortgages on real estate located in its market area, which consists of Cuyahoga, Lake, Geauga, Portage, Summit, Stark, Medina, and Lorain Counties in Ohio. The Bank has concentrated its activities on serving the borrowing needs of local homeowners and builders in its market area by originating both fixed-rate and adjustable-rate single-family mortgage loans, as well as construction loans, commercial real estate loans, and multi-family residential real estate loans. In addition, to a lesser extent, the Bank originates loans secured by second mortgages, including equity line of credit loans secured by real estate, and non real estate loans. Lending activities are influenced by the demand for and supply of housing, competition among lenders, the level of interest rates, and the availability of funds. Deposit flows and cost of funds are influenced by prevailing market rates of interest, primarily on competing investments, account maturities, and the level of personal income and savings in the market area. FORWARD-LOOKING STATEMENTS When used in this Annual Report, the words or phrases "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 wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company wishes to advise 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 publicly release the result of any revisions which 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. OVERVIEW OF FINANCIAL CONDITION AT JUNE 30, 2003, 2002, AND 2001 PVF had total assets of $743.4 million, $679.6 million, and $736.5 million at June 30, 2003, 2002, and 2001, respectively. The primary source of the Bank's total assets has been its loan portfolio. Net loans receivable and mortgage-backed securities totaled $616.2 million, $582.5 million, and $597.9 million at June 30, 2003, 2002, and 2001, respectively. The increase of $33.7 million in net loans and mortgage-backed securities at June 30, 2003 resulted from an increase in loans receivable of $38.0 million offset by the repayment of mortgage-backed securities of $4.3 million. The increase in loans receivable resulted from increases of $7.0 million in one-to-four family residential loans, $14.4 million in commercial real estate loans, $14.5 million in home equity line of credit loans, $11.2 million in commercial equity line of credit loans, $2.8 million in land loans, and $3.3 million in non real estate loans. These increases were offset by decreases of $12.7 million in construction loans and $2.5 million in multi-family loans. Securities totaled $0.03 million, $55.1 million, and $50.2 million, and cash and cash equivalents totaled $96.8 million, $14.3 million, and $65.4 million at June 30, 2003, 2002, and 2001, respectively. The securities portfolio has been and will continue to be used primarily to meet the liquidity requirements of the Bank in its deposit taking and lending activities. 8 The Bank has adopted a policy that permits investment only in U.S. government and agency securities or Triple-A-rated securities. The Bank invests primarily in securities having a final maturity of five years or less, federal funds sold, and deposits at the Federal Home Loan Bank ("FHLB") of Cincinnati. The entire portfolio matures within five years or less, and the Bank has no plans to change the short-term nature of its securities portfolio. The Bank's deposits totaled $526.4 million, $479.7 million, and $480.5 million at June 30, 2003, 2002, and 2001, respectively. Advances from the FHLB amounted to $120.1 million, $120.7 million, and $185.9 million at June 30, 2003, 2002, and 2001, respectively. Management's decision to repay FHLB advances and to compete with market savings rates resulted in a decrease in FHLB advances of $0.6 million and an increase in savings deposits of $46.7 million for the year ended June 30, 2003. Funds from the decrease of $55.1 million in securities, increases of $46.7 million in deposits, an increase of $13.3 million in accrued expenses and other liabilities, and the increase in stockholders' equity of $6.3 million were used to fund the increase of $33.7 million in net loans and mortgage-backed securities, the increase of $82.4 million in cash and cash-equivalents, the repayments of $2.5 million in notes payable, and $0.6 million in FHLB advances. CAPITAL PVF's stockholders' equity totaled $58.6 million, $52.3 million, and $48.0 million at the years ended June 30, 2003, 2002, and 2001, respectively. The increases were the result of the retention of net earnings less cash dividends paid and purchased treasury stock. The Bank's primary regulator, The Office of Thrift Supervision ("OTS") has implemented a statutory framework for capital requirements which establishes five categories of capital strength ranging from "well capitalized" to "critically undercapitalized." An institution's category depends upon its capital level in relation to relevant capital measures, including two risk-based capital measures, a tangible capital measure, and a core/leverage capital measure. At June 30, 2003, the Bank was in compliance with all of the current applicable regulatory capital measurements to meet the definition of a well-capitalized institution, as demonstrated in the following table:

Park View Requirement for Federal Percent of Well-Capitalized (dollars in thousands) Capital Assets(1) Institution --------------------------------------------- GAAP capital $57,656 7.75% N/A Tangible capital $57,548 7.73% N/A Core capital $57,548 7.73% 5.00% Tier-1 risk-based capital $57,548 10.74% 6.00% Risk-based capital $61,196 11.43% 10.00%

(1)Tangible and core capital levels are shown as a percentage of total adjusted assets; risk-based capital levels are shown as a percentage of risk-weighted assets. COMMON STOCK AND DIVIDENDS The Company's common stock trades under the symbol "PVFC" on the Nasdaq Small-Cap Market. A 10 percent stock dividend was issued in September 1999, September 2000, August 2001, August 2002, and August 2003. As adjusted to reflect all stock dividends and purchases of treasury stock, the Company had 6,374,489 shares of common stock outstanding and approximately 247 holders of record of the common stock at September 9, 2003. OTS regulations applicable to all Federal Savings Banks such as Park View Federal limit the dividends that may be paid by the Bank to PVF. Any dividends paid may not reduce the Bank's capital below minimum regulatory requirements. In June 1999, the Company announced a stock repurchase program to acquire up to 5 percent of the Company's common stock and a quarterly cash dividend policy. In August 2002, the Company announced that it had implemented a new stock repurchase program to acquire up to an additional 5 percent of the Company's common stock. The stock repurchase program is dependent on market conditions with no guarantee as to the exact number of shares to be repurchased. At June 30, 2003, as adjusted to reflect all stock dividends, the Company had acquired a total of 343,519 shares, or 5.1 percent of the Company's common stock. The cash dividend policy remains dependent upon the Company's financial condition, earnings, capital needs, regulatory requirements, and economic conditions. A quarterly cash dividend of $0.072 per share, $0.074 per share, and $0.074 per share was paid on the Company's outstanding common stock in fiscal 2001, 2002, and 2003, respectively. [PVC CAPITAL CORP. LOGO] 2003 Annual Report 9 The following table sets forth certain information as to the range of the high and low bid prices for the Company's common stock for the calendar quarters indicated.(1)

Fiscal 2003 Fiscal 2002 ---------------------------------------------------- High Bid Low Bid High Bid Low Bid ------------------------- ------------------------- Fourth Quarter $ 13.41 $ 11.82 $ 10.95 $ 8.93 Third Quarter 13.01 10.91 9.23 8.26 Second Quarter 11.79 9.18 9.30 7.68 First Quarter 9.93 6.27 11.57 7.68

(1)Quotations reflect inter-dealer prices without retail mark-up, mark-down, or commission, and may not represent actual transactions. Bid prices have been adjusted to reflect the previously described stock dividends. LIQUIDITY AND CAPITAL RESOURCES The Company's liquidity measures its ability to fund loans and meet withdrawals of deposits and other cash outflows in a cost-effective manner. The Company's primary sources of funds for operations are deposits from its primary market area, principal and interest payments on loans and mortgage-backed securities, sales of loans and mortgage-backed securities, proceeds from maturing securities, and advances from the FHLB of Cincinnati. While loan and mortgage-backed securities payments and maturing securities are relatively stable sources of funds, deposit flows and loan prepayments are greatly influenced by prevailing interest rates, economic conditions, and competition. FHLB advances may be used on a short-term basis to compensate for deposit outflows or on a long-term basis to support expanded lending and investment activities. The Bank uses its capital resources principally to meet its ongoing commitment to fund maturing certificates of deposit and deposit withdrawals, repay borrowings, fund existing and continuing loan commitments, maintain its liquidity, and meet operating expenses. At June 30, 2003, the Bank had commitments to originate loans totaling $79.5 million and had $59.8 million of undisbursed loans in process. Scheduled maturities of certificates of deposit during the 12 months following June 30, 2003 totaled $249.3 million. Management believes that a significant portion of the amounts maturing during fiscal 2004 will be reinvested with the Bank because they are retail deposits, however, no assurances can be made that this will occur. Park View Federal maintains liquid assets sufficient to meet operational needs. The Bank's most liquid assets are cash and cash equivalents, which are short-term, highly-liquid investments with original maturities equal to or less than three months that are readily convertible to known amounts of cash. The levels of such assets are dependent upon the Bank's operating, financing, and investment activities at any given time. Management believes that the liquidity levels maintained are more than adequate to meet potential deposit outflows, repay maturing FHLB advances, fund new loan demand, and cover normal operations. MARKET RISK MANAGEMENT Market risk is the risk of loss arising from adverse changes in the fair value of financial instruments due to changes in interest rates, exchange rates, and equity prices. The Bank's market risk is composed of interest rate risk. Asset/Liability Management: The Bank's asset and liability committee ("ALCO"), which includes senior management representatives, monitors and considers methods of managing the rate sensitivity and repricing characteristics of the balance sheet components consistent with maintaining acceptable levels of changes in net portfolio value ("NPV") and net interest income. Park View Federal's asset and liability management program is designed to minimize the impact of sudden and sustained changes in interest rates on NPV and net interest income. PROFILE OF INTEREST SENSITIVE ASSETS [PIE CHART] 12.4% Overnight Fed funds 2.0% Fixed-rate other mortgage loans 1.6% Non real estate loans 38.0% Adjustable-rate single-family mortgage loans 38.3% Adjustable-rate other 7.3% Fixed-rate single-family mortgage loans mortgage loans 0.4% Adjustable-rate mortgage-backed securities [PVC CAPITAL CORP. LOGO] 2003 Annual Report 10 PROFILE OF INTEREST SENSITIVE LIABILITIES 18.8% FHLB Advances over 13 months 38.9% CDs 12 months or less 1.3% Other borrowings 60 months or less 2.1% CDs 25 to 36 months 10.4% Transaction accounts 18.1% CDs 13 to 24 months 6.7% Passbook accounts 3.7% CDs over 36 months The Bank's exposure to interest rate risk is reviewed on a quarterly basis by the Board of Directors and the ALCO. Exposure to interest rate risk is measured with the use of interest rate sensitivity analysis to determine the Bank's change in NPV in the event of hypothetical changes in interest rates, while interest rate sensitivity gap analysis is used to determine the repricing characteristics of the Bank's assets and liabilities. If estimated changes to NPV and net interest income are not within the limits established by the Board, the Board may direct management to adjust its asset and liability mix to bring interest rate risk within Board-approved limits. In order to reduce the exposure to interest rate fluctuations, the Bank has developed strategies to manage its liquidity, shorten its effective maturity, and increase the interest rate sensitivity of its asset base. Management has sought to decrease the average maturity of its assets by emphasizing the origination of adjustable-rate residential mortgage loans and adjustable-rate mortgage loans for the acquisition, development, and construction of residential and commercial real estate, all of which are retained by the Bank for its portfolio. In addition, all long-term, fixed-rate mortgages are underwritten according to guidelines of the Federal Home Loan Mortgage Corporation ("FHLMC") and the Federal National Mortgage Association ("FNMA") and are either swapped with the FHLMC and the FNMA in exchange for mortgage-backed securities secured by such loans, which are then sold in the market or sold directly for cash in the secondary market. Interest rate sensitivity analysis is used to measure the Bank's interest rate risk by computing estimated changes in NPV of its cash flows from assets, liabilities, and off-balance sheet items in the event of a range of assumed changes in market interest rates. NPV represents the market value of portfolio equity and is equal to the market value of assets minus the market value of liabilities, with adjustments made for off-balance sheet items. This analysis assesses the risk of loss in market risk sensitive instruments in the event of an immediate and sustained 1 and 2 percent increase or decrease in market interest rates. The Bank's Board of Directors has adopted an interest rate risk policy which establishes maximum decreases in the NPV ratio (ratio of market value of portfolio equity to the market value of portfolio assets) of 0.5 and 1.0 percent in the event of an immediate and sustained 1 and 2 percent increase or decrease in market interest rates. The following table presents the Bank's projected change in NPV for the various rate shock levels at June 30, 2003 and 2002. All market risk sensitive instruments presented in this table are held to maturity or available for sale. The Bank has no trading securities.

(dollars in thousands) June 30, 2003 June 30, 2002 ----------------------------------- -------------------------------------- Change in Market Value of Dollar NPV Market Value of Dollar NPV Interest Rates Portfolio Equity Change Ratio Portfolio Equity Change Ratio -------------- ---------------- ------ ----- ---------------- ------ ----- +2% $ 71,763 $ 6,455 9.37% $ 74,641 $ 678 10.67% +1% 68,847 3,539 8.95 75,347 1,384 10.71 0 65,308 8.46 73,963 10.46 -1% 59,358 (5,950) 7.66 70,065 (3,897) 9.88 -2% N/A N/A N/A N/A N/A N/A

[PVC CAPITAL CORP. LOGO] 2003 Annual Report 11 The table illustrates that for June 30, 2002 and June 30, 2003, in the event of an immediate and sustained increase in prevailing market interest rates, the Bank's NPV ratio would be expected to increase, while in the event of an immediate and sustained decrease in prevailing market rates, the Bank's NPV ratio would be expected to decrease. The Bank carefully monitors the maturity and repricing of its interest-earning assets and interest-bearing liabilities to minimize the effect of changing interest rates on its NPV. At June 30, 2003, the Bank's estimated changes in NPV ratio were within the targets established by the Board of Directors in the event of an immediate and sustained increase in prevailing market interest rates, but exceeded Board-approved target levels in a decreasing interest rate environment. The Bank's interest rate risk ("IRR") position currently exceeds Board-approved target levels in a decreasing interest rate environment because of the maturity and repricing characteristics of assets and liabilities. The balance sheet is primarily comprised of interest-earning assets having a maturity and repricing period of from one month to five years. These assets were funded utilizing interest-bearing liabilities having a final maturity of two years or less and advances convertible at the option of the FHLB of Cincinnati. Management will carefully monitor its IRR position and will make the necessary adjustments to its asset and liability mix to bring the Bank's NPV ratio to within target levels established by the Board of Directors. NPV is calculated by the OTS using information provided by the Bank. The calculation is based on the net present value of discounted cash flows utilizing market prepayment assumptions and market rates of interest provided by Bloomberg quotations and surveys performed during the quarters ended June 30, 2003 and 2002, with adjustments made to reflect the shift in the Treasury yield curve between the survey date and the quarter-end date. Computation of prospective effects of hypothetical interest rate changes are based on numerous assumptions, including relative levels of market interest rates, loan prepayments, and deposit decay, and should not be relied upon as indicative of actual results. Further, the computations do not contemplate any actions the Bank may undertake in response to changes in interest rates. Certain shortcomings are inherent in the method of analysis presented in the computation of NPV. Actual values may differ from those projections set forth in the table, should market conditions vary from assumptions used in the preparation of the table. Certain assets such as adjustable-rate loans, which represent the Bank's primary loan product, have features which restrict changes in interest rates on a short-term basis and over the life of the asset. In addition, the proportion of adjustable-rate loans in the Bank's portfolio could decrease in future periods if market interest rates remain at or decrease below current levels due to refinance activity. Further, in the event of a change in interest rates, prepayment and early withdrawal levels would likely deviate significantly from those assumed in the table. Finally, the ability of many borrowers to repay their adjustable-rate debt may decrease in the event of an interest rate increase. The Bank uses interest rate sensitivity gap analysis to monitor the relationship between the maturity and repricing of its interest-earning assets and interest-bearing liabilities, while maintaining an acceptable interest rate spread. Interest rate sensitivity gap is defined as the difference between the amount of interest-earning assets maturing or repricing within a specific time period and the amount of interest-bearing liabilities maturing or repricing within that time period. A gap is considered positive when the amount of interest-rate-sensitive assets exceeds the amount of interest-rate-sensitive liabilities, and is considered negative when the amount of interest-rate-sensitive liabilities exceeds the amount of interest-rate- sensitive assets. Generally, during a period of rising interest rates, a negative gap would adversely affect net interest income, while a positive gap would result in an increase in net interest income. Conversely, during a period of falling interest rates, a negative gap would result in an increase in net interest income, while a positive gap would negatively affect net interest income. Management's goal is to maintain a reasonable balance between exposure to interest rate fluctuations and earnings. The following table summarizes the Bank's interest rate sensitivity gap analysis at June 30, 2003. The table indicates that the Bank's one year and under ratio of cumulative gap to total assets is a positive 29.7 percent, one-to-three year ratio of cumulative gap to total assets is a positive 17.1 percent, and three-to-five year ratio of cumulative gap to total assets is a positive 23.4 percent. The positive gap position of the Bank is consistent with the change in the Bank's NPV ratio to an immediate and sustained 1 and 2 percent increase and a 1 percent decrease in market interest rates. [PVC CAPITAL CORP. LOGO] 2003 Annual Report 12

Within 1-3 3-5 Greater Than 5 (dollars in thousands) 1 Year Years Years Years Total - ------------------------------------------------------------------------------------------------------------------ Total interest-rate-sensitive assets ...... $ 456,053 $ 110,204 $ 91,399 $ 45,613 $ 703,269 Total interest-rate-sensitive liabilities.. 254,216 195,742 48,898 141,919 640,775 Periodic GAP .............................. 201,837 (85,538) 42,501 (96,306) 62,494 Cumulative GAP ............................ 201,837 116,299 158,800 62,494 Ratio of cumulative GAP to total assets ... 29.7% 17.1% 23.4% 9.2%

COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET RISK The Company is a party to financial instruments with off-balance sheet risk including commitments to originate new loans, commitments to extend credit under existing lines of credit and commitments to sell loans. These instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the consolidated balance sheet. Off-balance sheet financial instruments whose contract amounts represent credit and interest rate risk are summarized as follows:

June 30, ------------------------ (dollars in thousands) 2003 2002 ------- -------- Commitments to originate: Mortgage loans held for sale $66,782 $30,247 Mortgage loans held for investment 12,669 14,173 Unfunded home equity and commercial real estate lines of credit 68,445 53,882 Commitments to sell loans held for sale 89,630 25,733 Standby letters of credit 1,417 519

Commitments to originate new loans or to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Loan commitments generally expire within 30 to 60 days. Most home equity line of credit commitments are for a term of five years, and commercial real estate lines of credit are generally renewable every two years. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. 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 Company evaluates each customer's creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management's credit evaluation of the borrower. Commitments to sell loans held for sale are agreements to sell loans to a third party at an agreed-upon price. At June 30, 2003, the agreed-upon price of these commitments exceeded the book value of loans to be sold. The fair value of commitments to originate mortgage loans held for sale and commitments to sell loans held for sale at June 30, 2003 was not considered material. The following table presents as of June 30, 2003, PVF Capital Corp.'s significant fixed and determinable contractual obligations by payment date. The payment amounts represent those amounts contractually due to the recipient and do not include any unamortized premiums or discounts or other similar carrying value adjustments. Further discussion of the nature of each obligation is included in the referenced note to the consolidated financial statements. [PVC CAPITAL CORP. LOGO] 2003 Annual Report 13

Contractual Obligations: Note Within 1-3 3-5 Greater Than 5 (dollars in thousands) Reference 1 Year Years Years Years Total - --------------------------------------------------------------------------------------------------------------------- Deposits without a stated maturity ..... 7 $124,263 -- -- -- $124,263 Certificates of deposit ................ 7 249,316 129,493 23,357 -- 402,166 Advances from the FHLB of Cincinnati ... 8 42 81 20,000 100,000 120,123 Notes payable .......................... 9 79 2,678 3,058 -- 5,815 Operating leases ....................... 11 581 839 714 702 2,836

RESULTS OF OPERATIONS GENERAL PVF Capital Corp.'s net income for the year ended June 30, 2003 was $8.1 million, or $1.27 basic earnings per share and $1.25 diluted earnings per share as compared to $7.2 million, or $1.12 basic earnings per share and $1.09 diluted earnings per share for fiscal 2002, and $6.6 million, or $1.05 basic earnings per share and $1.02 diluted earnings per share for fiscal 2001. All per share amounts have been adjusted for stock dividends. Net income for the current year increased by $0.9 million from the prior fiscal year and was $1.5 million greater than net income for fiscal 2001. NET INTEREST INCOME Net interest income amounted to $22.8 million for the year ended June 30, 2003, as compared to $21.8 million and $19.8 million for the years ended June 30, 2002 and 2001, respectively. Changes in the level of net interest income reflect changes in interest rates and changes in volume of interest-earning assets and interest-bearing liabilities. Tables 1 and 2 provide information as to changes in the Bank's net interest income. Table 1 sets forth certain information relating to the Bank's average interest-earning assets (loans and securities) and interest-bearing liabilities (deposits and borrowings) and reflects the average yield on assets and average cost of liabilities for the periods and at the dates indicated. Such yields and costs are derived by dividing interest income or interest expense by the average daily balance of assets or liabilities, respectively, for the periods presented. During the periods indicated, non-accrual loans are included in the net loan category. Table 1 also presents information for the periods indicated with respect to the difference between the weighted-average yield earned on interest-earning assets and weighted-average rate paid on interest-bearing liabilities, or "interest rate spread," which savings institutions have traditionally used as an indicator of profitability. Another indicator of an institution's net interest income is its "net interest margin" or "net yield on interest-earning assets," which is its net interest income divided by the average balance of net interest-earning assets. Net interest income is affected by the interest rate spread and by the relative amounts of interest-earning assets and interest-bearing liabilities. Table 2 illustrates the extent to which changes in interest rates and shifts in the volume of interest-related assets and liabilities have affected the Bank's interest income and expense during the years indicated. The table shows the changes by major component, distinguishing between changes relating to volume (changes in average volume multiplied by average old rate) and changes relating to rate (changes in average rate multiplied by average old volume). Changes not solely attributable to volume or rate have been allocated in proportion to the changes due to volume and rate. [PVC CAPITAL CORP. LOGO] 2003 Annual Report 14

Table 1 AVERAGE BALANCES, INTEREST, AND AVERAGE YIELDS AND RATES FOR THE YEAR ENDED JUNE 30, 2003 2002 2001 --------------------------------------------------------------------------------- Average Yield/ Average Yield/ Average Yield/ (dollars in thousands) Balance Interest Cost Balance Interest Cost Balance Interest Cost - ---------------------------------------------------------------------------------------------------------------------------------- Interest-earning assets: Loans $601,122 $ 40,690 6.77% $581,812 $ 44,323 7.62% $551,424 $ 48,101 8.72% Mortgage-backed securities 4,705 285 6.06 11,662 719 6.17 16,059 1,189 7.40 Securities and other interest-earning assets 70,861 2,507 3.54 73,588 3,772 5.13 74,046 4,672 6.31 -------- -------- -------- -------- -------- -------- Total interest-earning assets 676,688 43,482 6.43 667,062 48,814 7.32 641,529 53,962 8.41 -------- -------- -------- Non-interest-earning assets 27,709 30,112 26,786 -------- -------- -------- Total assets $704,397 $697,174 $668,315 ======== ======== ======== Interest-bearing liabilities: Deposits $496,910 $ 15,170 3.05 $471,320 $ 20,995 4.45 $480,692 $ 27,080 5.63 FHLB advances 122,034 5,205 4.27 142,820 5,824 4.08 117,624 6,682 5.68 Notes payable 7,060 271 3.84 5,600 241 4.30 4,331 356 8.22 -------- -------- -------- -------- -------- -------- Total interest-bearing liabilities 626,004 20,646 3.30 619,740 27,060 4.37 602,647 34,118 5.66 -------- ---- -------- ---- -------- ---- Non-interest-bearing liabilities 23,031 26,947 20,267 -------- -------- -------- Total liabilities 649,035 646,687 622,914 Stockholders' equity 55,362 50,487 45,401 -------- -------- -------- Total liabilities and stockholders' equity $704,397 $697,174 $668,315 ======== ======== ======== Net interest income $ 22,836 $ 21,754 $ 19,844 ======== ======== ======== Interest rate spread 3.13% 2.95% 2.75% ==== ==== ==== Net yield on interest-earning assets 3.37% 3.26% 3.09% ==== ==== ==== Ratio of average interest-earning assets to average interest-bearing liabilities 108.10% 107.64% 106.45% ======== ======== ========

As is evidenced by these tables, interest rate changes had a positive effect on the Bank's net interest income for the years ended June 30, 2003 and June 30, 2002. Due to the repricing characteristics of the Bank's loan portfolio and short-term nature of its deposit portfolio, along with declining interest rates during much of the year ended June 30, 2003 and June 30, 2002, the Bank experienced an increase of 18 basis points in its interest rate spread to 3.13 percent for fiscal 2003 from 2.95 percent for fiscal 2002, and during fiscal 2002 its interest rate spread increased 20 basis points from 2.75 percent for fiscal 2001. These changes in interest rate spread contributed to an increase in net interest income for the year ended June 30, 2003 of $0.5 million, and an increase in net interest income for the year ended June 30, 2002 of $0.5 million due to interest rate changes. Net interest income was favorably affected by volume changes during the years ended June 30, 2003 and 2002. Accordingly, net interest income grew by $0.6 million and $1.4 million due to volume changes for the years ended June 30, 2003 and 2002, respectively. The rate/volume analysis illustrates the effect that volatile interest rate environments can have on a financial institution. A flattening yield curve will typically have a negative effect on net interest income, while a steepening yield curve will typically have a positive effect on net interest income. [PVC CAPITAL CORP. LOGO] 2003 Annual Report 15

Table 2 YEAR ENDED JUNE 30, ------------------------------------------------------------------------- 2003 vs. 2002 2002 vs. 2001 --------------------------------- ---------------------------------- Increase (Decrease) Increase (Decrease) Due to Due to --------------------------------- ---------------------------------- (dollars in thousands) Volume Rate Total Volume Rate Total --------------------------------- ---------------------------------- Interest income: Loans ........................................ $ 1,471 $(5,103) $(3,632) $ 2,315 $(6,093) $(3,778) Mortgage-backed securities ................... (429) (5) (434) (271) (199) (470) Securities and other interest-earning assets . (97) (1,169) (1,266) (23) (877) (900) ------- ------- ------- ------- ------- ------- Total interest-earning assets .............. 945 (6,277) (5,332) 2,021 (7,169) (5,148) ------- ------- ------- ------- ------- ------- Interest expense: Deposits ..................................... 1,140 (6,965) (5,825) (417) (5,667) (6,084) FHLB advances ................................ (848) (228) (620) 1,028 (1,886) (858) Notes payable ................................ 63 (32) 31 54 (170) (116) ------- ------- ------- ------- ------- ------- Total interest-bearing liabilities ......... 355 (6,769) (6,414) 665 (7,723) (7,058) ------- ------- ------- ------- ------- ------- Net interest income ............................ $ 590 $ 492 $ 1,082 $ 1,356 $ 554 $ 1,910 ======= ======= ======= ======= ======= =======

PROVISION FOR LOAN LOSSES The Bank carefully monitors its loan portfolio and establishes levels of general and specific reserves for loan losses. Provisions for loan losses are charged to earnings to bring the total allowances for loan losses to a level considered adequate by management to provide for probable loan losses inherent in the loan portfolio as of each balance sheet date, based on prior loss experience, volume and type of lending conducted by the Bank, industry standards, and past due loans in the Bank's loan portfolio. The Bank's policies require the review of assets on a regular basis, and the Bank appropriately classifies loans as well as other assets if warranted. The Bank establishes specific provisions for loan losses when a loan is deemed to be uncollectible in an amount equal to the net book value of the loan or to any portion of the loan deemed uncollectible. A loan that is classified as either substandard or doubtful is assigned an allowance based upon the specific circumstances on a loan-by-loan basis after consideration of the underlying collateral and other pertinent economic and market conditions. In addition, the Bank maintains general allowances based upon the establishment of a risk category for each type of loan in the Bank's portfolio. The Bank uses a systematic approach in determining the adequacy of its loan loss allowance and the necessary provision for loan losses, whereby the loan portfolio is reviewed generally and delinquent loan accounts are analyzed individually, on a monthly basis. Consideration is given primarily to the types of loans in the portfolio and the overall risk inherent in the portfolio as well as, with respect to individual loans, account status, payment history, ability to repay and probability of repayment, and loan-to-value percentages. After reviewing current economic conditions, changes in delinquency status, and actual loan losses incurred by the Bank, management establishes an appropriate reserve percentage applicable to each category of loans, and a provision for loan losses is recorded when necessary to bring the allowance to a level consistent with this analysis. During the year ended June 30, 2002, management conducted a review of the established reserve percentages used in calculating the required loan loss allowance. This review was conducted using the most currently available national and regional aggregate thrift industry data on charge-offs along with an analysis of historical losses experienced by the Bank according to type of loan. As a result of this analysis, management made moderate adjustments to the required reserve percentages on various loan categories to more accurately reflect probable losses. Management believes it uses the best information available to make a determination with respect to the allowance for loan losses, recognizing that future adjustments may be necessary depending upon a change in economic conditions. [PVC CAPITAL CORP. LOGO] 2003 Annual Report 16 During 2003, the Bank experienced growth in the loan portfolio of $38.0 million, or 6.6 percent, while substantially maintaining the composition of the loan portfolio. In addition, the level of impaired loans decreased from $13.0 million to $12.8 million, while the specific allowance related to impaired loans increased from $30,000 to $235,000. The decrease in the level of impaired loans to total loans caused the percentage of allowance for loan losses to impaired loans to increase from 30 to 31 percent. Net charge-offs decreased from $176,000 in 2002 to $19,000 in 2003. Therefore, taking into consideration the growth of the portfolio, the level of impaired loans, as well as net charge-offs and the overall performance of the loan portfolio, the Bank provided no additional provision and maintained the allowance at a level deemed appropriate of $3.9 million. During 2002, the Bank experienced a decline in the loan portfolio of $4.6 million, or 0.8 percent, while substantially maintaining the composition of the loan portfolio. In addition, the level of impaired loans increased from $5.4 million to $13.0 million, while the specific allowance related to impaired loans increased from $25,000 to $30,000. The increase in the level of impaired loans to total loans caused the percentage of allowance for loan losses to impaired loans to decrease from 65 to 30 percent. Net charge-offs increased from $93,000 in 2001 to $176,000 in 2002. Therefore, taking into consideration the higher level of impaired loans, as well as the higher level of net charge-offs and the overall performance of the loan portfolio, the Bank provided $558,000 of additional provision to increase the allowance to a level deemed appropriate of $3.9 million. NON-INTEREST INCOME Non-interest income amounted to $5.9 million, $3.8 million, and $2.6 million for the years ended June 30, 2003, 2002, and 2001, respectively. The fluctuations in non-interest income are due primarily to fluctuations in income derived from mortgage banking activities, fee income on deposit accounts, gain on sale of real estate, and rental income. Income attributable to mortgage banking activities consists of loan servicing income, gains and losses on the sale of loans and mortgage-backed securities, and market valuation provisions and recoveries. Income from mortgage banking activities amounted to $4.9 million, $3.0 million, and $1.1 million for the years ended June 30, 2003, 2002, and 2001, respectively. The increases in income from mortgage banking activities of $1.9 million from the year ended June 30, 2001 to 2002, and from the year ended June 30, 2002 to 2003, is primarily due to an increase in net profit realized on the sale of loans. The results of operations from mortgage banking activity are attributable in large part to historically low market interest rates and are not necessarily indicative of expected future results. Other non-interest income amounted to $971,000, $766,000, and $1,164,000 for the years ended June 30, 2003, 2002, and 2001, respectively. The decrease in other non-interest income of $398,000 from the year ended June 30, 2001 to June 30, 2002 is attributable to a decline in rental income in 2002. The increase in other non-interest income of $205,000 from the year ended June 30, 2002 to June 30, 2003 is primarily due to an increase in loan prepayment fee and late charge fee income. Changes in other non-interest income are typically the result of service and other miscellaneous fee income, rental income, insurance proceeds, income realized on the sale of assets and investments, and the disposal of real estate owned properties. NON-INTEREST EXPENSE Non-interest expense amounted to $16.5 million, $14.1 million, and $12.2 million for the years ended June 30, 2003, 2002, and 2001, respectively. The principal component of non-interest expense is compensation and related benefits which amounted to $8.7 million, $7.6 million, and $6.5 million for the years ended June 30, 2003, 2002, and 2001, respectively. The increase in compensation for the years ended June 30, 2002 and 2001 is due primarily to growth in the staff, employee 401K benefits, a compensation incentive plan for management, and inflationary salary and wage adjustments to employees. Office occupancy totaled $3.2 million, $2.8 million, and $2.6 million for the years ended June 30, 2003, 2002, and 2001, respectively. The increased occupancy expense is attributable to the cost of our Corporate Center in Solon, Ohio, maintenance and repairs to office buildings, and the cost of opening and operating additional branch offices. Other non-interest expense totaled $4.6 million, $3.7 million, and $3.1 million for the years ended June 30, 2003, 2002, and 2001, respectively. Changes [PVC CAPITAL CORP. LOGO] 2003 Annual Report 17 in other non-interest expense are primarily the result of advertising, professional and legal services, insurance expenses, outside services, and franchise tax expense. FEDERAL INCOME TAXES The Company's federal income tax expense was $4.1 million, $3.6 million, and $3.4 million for the years ended June 30, 2003, 2002, and 2001, respectively. Due to the availability of tax credits for the years ended June 30, 2002, 2001, and 2000, and other miscellaneous deductions, the Company's effective federal income tax rate was below the expected tax rate of 35 percent with an effective rate of 34 percent for the years ended June 30, 2003, 2002, and 2001, respectively. IMPACT OF INFLATION AND CHANGING PRICES The consolidated financial statements and related data presented herein have been prepared in accordance with generally accepted accounting principles, which requires the measurement of financial position and operating results in terms of historical dollars, without considering changes in the relative purchasing power of money over time due to inflation. Unlike most industrial companies, substantially all of the assets and liabilities of the Bank are monetary in nature. As a result, interest rates have a more significant impact on the Bank's performance than the effects of general levels of inflation. Interest rates do not necessarily move in the same direction or in the same magnitude as the prices of goods and services, since such prices are affected by inflation to a larger extent than interest rates. For further information regarding the effect of interest rate fluctuations on the Bank, see "Market Risk Management." CRITICAL ACCOUNTING POLICIES AND ESTIMATES The accounting and reporting policies of PVF Capital Corp. are in accordance with accounting principles generally accepted within the United States of America and conform to general practices within the banking industry. Application of these principles requires management to make estimates, assumptions and judgments that affect the amounts reported in the financial statements and accompanying notes. These estimates, assumptions and judgments are based on information available as of the date of the financial statements. Accordingly, as this information changes, the financial statements could reflect different estimates, assumptions and judgments. The most significant accounting policies followed by PVF Capital Corp. are presented in Note 1 to the consolidated financial statements. Accounting and reporting policies for the allowance for loan losses and mortgage servicing rights are deemed critical since they involve the use of estimates and require significant management judgments. PVF Capital Corp. provides further detail on the methodology and reporting of the allowance for loan losses in Note 4 and mortgage servicing rights in Note 5. EFFECT OF NEW FINANCIAL ACCOUNTING STANDARDS The Financial Accounting Standards Board (FASB) recently issued two new accounting standards, Statement 149, "Amendment of Statement 133 on Derivative Instruments and Hedging Activities," and Statement 150, "Accounting for Certain Financial Instruments with Characteristics of Both Liabilities and Equities," both of which generally become effective in the quarter beginning July 1, 2003. Management determined that adoption of the new standards will not materially affect the Company's operating results or financial condition. [PVC CAPITAL CORP. LOGO] 18 [PARK VIEW FEDERAL LOGO] - -------------------------------------------------------------------------------- Office Locations and Hours Office Locations and Hours -------------------------- AVON OFFICE NORTH ROYALTON OFFICE BEACHWOOD OFFICE SHAKER HEIGHTS OFFICE 36311 Detroit Road 13901 Ridge Road La Place Shaker Towne Centre Avon, Ohio 44011 North Royalton, Ohio 44133 2111 Richmond Road 16909 Chagrin Blvd. 440-934-3580 440-582-7417 Beachwood, Ohio 44122 Shaker Hts., Ohio 44120 216-831-6373 216-283-4003 BAINBRIDGE OFFICE SOLON OFFICE 8500 Washington Street Solar Shopping Center LAKEWOOD-CLEVELAND OFFICE LOBBY Chagrin Falls, Ohio 44023 34400 Aurora Road 11010 Clifton Blvd. MON., TUES., WED., THURS.: 440-543-8889 Solon, Ohio 44139 Cleveland, Ohio 44102 9:00 am - 4:30 pm 440-542-6070 216-631-8900 FRIDAY: 9:00 am - 6:00 pm BEDFORD OFFICE SATURDAY: 9:00 am - 1:00 pm 413 Northfield Road STRONGSVILLE OFFICE LOBBY Bedford, Ohio 44146 17780 Pearl Road MON., TUES., THURS.: 440-439-2200 Strongsville, Ohio 44136 9:00 am - 4:30 pm 440-878-6010 FRIDAY: 9:00 am - 5:30 pm CORPORATE CENTER OFFICE CHARDON OFFICE SATURDAY: 9:00 am - 1:00 pm 30000 Aurora Road 408 Water Street LOBBY CLOSED WEDNESDAY Solon, Ohio 44139 Chardon, Ohio 44024 MON., TUES., WED., THURS.: 440-914-3900 440-285-2343 9:00 am - 4:30 pm AUTO TELLER FRIDAY: 9:00 am - 5:30 pm MON., TUES., THURS.: SATURDAY: 9:00 am - 1:00 pm 9:00 am - 5:00 pm LOBBY & AUTO TELLER MACEDONIA OFFICE FRIDAY: 9:00 am - 6:00 pm MONDAY - FRIDAY: 497 East Aurora Road SATURDAY: 9:00 am - 1:00 pm 9:00 am - 5:00 pm Macedonia, Ohio 44056 AUTO TELLER CLOSED WEDNESDAY CLOSED SATURDAY 330-468-0055 MON., TUES., WED., THURS.: 9:00 am - 5:00 pm MAYFIELD HEIGHTS OFFICE FRIDAY: 9:00 am - 6:00 pm 1456 SOM Center Road SATURDAY: 9:00 am - 1:00 pm Mayfield Hts., Ohio 44124 440-449-8597 MEDINA OFFICE Reserve Square 3613 Medina Road Medina, Ohio 44256 330-721-7484 MENTOR OFFICE Heisley Corners 6990 Heisley Road Mentor, Ohio 44060 440-944-0276 19 [PARK VIEW FEDERAL LOGO] - --------------------------------------------------------------------------------

Board of Directors Officers Board of Directors Officers - --------------------------------- ---------------------------------- JOHN R. MALE JOHN R. MALE Chairman of the Board and Chairman of the Board and Chief Executive Officer Chief Executive Officer C. KEITH SWANEY C. KEITH SWANEY President, Chief Operating Officer President, Chief Operating Officer and Chief Financial Officer and Chief Financial Officer GERALD A. FALLON JEFFREY N. MALE Retired Executive Vice President ROBERT K. HEALEY ANNE M. JOHNSON Retired Senior Vice President Operations RONALD D. HOLMAN, II Partner CAROL S. PORTER Cavitch, Familo, Durkin & Frutkin Corporate Secretary and Marketing Director STANLEY T. JAROS Partner EDWARD B. DEBEVEC Moriarty & Jaros, P.L.L. Treasurer RAYMOND J. NEGRELLI MARK E. FOSNAUGHT President Vice President Raymond J. Negrelli, Inc. Branch Coordinator STUART D. NEIDUS WILLIAM J. HARR, JR. Chairman and Vice President Chief Executive Officer Anthony & Sylvan Pools Corporation ADELINE NOVAK Vice President Human Resources ROBERT J. PAPA Vice President Construction Lending JOHN E. SCHIMMELMANN Vice President Deposit Operations KENNAIRD H. STEWART Vice President Commercial Real Estate Lending

20 INDEPENDENT AUDITORS' REPORT The Board of Directors PVF Capital Corp. Solon, Ohio We have audited the accompanying consolidated statements of financial condition of PVF Capital Corp. (Company) as of June 30, 2003 and 2002, and the related consolidated statements of operations, stockholders' equity, and cash flows for the years ended June 30, 2003 and 2002. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. The 2001 financial statements were audited by other auditors, whose report dated July 27, 2001 expressed on unqualified opinion on those statements. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. 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 statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of PVF Capital Corp. as of June 30, 2003 and 2002, and the results of its operations and its cash flows for the years ended June 30, 2003 and 2002 in conformity with accounting principles generally accepted in the United States of America. Crowe, Chizek and Company, LLP Cleveland, Ohio August 1, 2003 21 PVF CAPITAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION Years ended June 30, 2003 and 2002

ASSETS 2003 2002 ---- ---- Cash and amounts due from depository institutions $ 9,755,224 $ 4,526,976 Interest bearing deposits 3,946,019 1,736,712 Federal funds sold 83,050,000 8,050,000 ------------- ------------- Cash and cash equivalents 96,751,243 14,313,688 Securities held to maturity (fair value 2003- $33,252, 2002-$55,751,561) 33,252 55,121,211 Mortgage-backed securities held to maturity (fair value 2003- $3,032,385, 2002-$7,500,739) 2,964,798 7,297,206 Loans receivable held for sale, net 33,603,895 11,679,735 Loans receivable, net of allowance of $3,882,839 and $3,901,839 579,670,681 563,550,556 Office properties and equipment, net 11,555,919 9,817,348 Real estate owned 448,865 564,316 Federal Home Loan Bank stock 10,396,399 9,947,624 Prepaid expenses and other assets 7,978,751 7,328,431 ------------- ------------- Total assets $ 743,403,803 $ 679,620,115 ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities: Deposits $ 526,428,927 $ 479,672,218 Advances from the Federal Home Loan Bank of Cincinnati 120,123,220 120,739,695 Notes payable 5,815,150 8,288,020 Advances from borrowers for taxes and insurance 7,964,653 7,320,613 Accrued expenses and other liabilities 24,468,717 11,300,991 ------------- ------------- Total liabilities 684,800,667 627,321,537 ------------- ------------- Commitments and contingencies Stockholders' equity: Serial preferred stock, $.01 par value, 1,000,000 shares authorized; none issued -- -- Common stock, $.01 par value, 15,000,000 shares authorized; 6,717,283 and 6,064,809 shares issued, respectively 67,173 60,648 Additional paid-in capital 47,176,696 37,412,482 Retained earnings 14,486,460 17,627,665 Treasury stock, at cost, 343,519 and 286,276 shares, respectively (3,127,193) (2,802,217) ------------- ------------- Total stockholders' equity 58,603,136 52,298,578 ------------- ------------- Total liabilities and stockholders' equity $ 743,403,803 $ 679,620,115 ============= =============

- -------------------------------------------------------------------------------- See accompanying notes to consolidated financial statements. 22 PVF CAPITAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS Years ended June 30, 2003, 2002 and 2001

2003 2002 2001 ----------- ----------- ----------- Interest income: Loans $40,690,675 $44,322,897 $48,100,662 Mortgage-backed securities 285,167 719,321 1,189,468 Cash and securities 2,506,855 3,772,463 4,671,814 ----------- ----------- ----------- Total interest income 43,482,697 48,814,681 53,961,944 ----------- ----------- ----------- Interest expense: Deposits 15,169,502 20,995,003 27,079,731 Borrowings 5,476,773 6,065,389 7,038,219 ----------- ----------- ----------- Total interest expense 20,646,275 27,060,392 34,117,950 ----------- ----------- ----------- Net interest income 22,836,422 21,754,289 19,843,994 Provision for loan losses -- 558,000 225,000 ----------- ----------- ----------- Net interest income after provision for loan losses 22,836,422 21,196,289 19,618,994 ----------- ----------- ----------- Noninterest income: Service and other fees 743,877 625,631 562,613 Mortgage banking activities, net 4,922,069 2,985,424 1,134,505 Gain on sale of real estate -- -- 300,790 Rental income -- -- 270,528 Other, net 227,057 139,913 331,150 ----------- ----------- ----------- Total noninterest income 5,893,003 3,750,968 2,599,586 ----------- ----------- ----------- Noninterest expense: Compensation and benefits 8,694,397 7,643,251 6,493,661 Office, occupancy, and equipment 3,151,956 2,758,158 2,586,580 Insurance 262,366 226,511 208,279 Professional and legal 518,648 425,185 344,849 Advertising 499,438 368,775 256,244 Outside services 857,050 520,181 355,626 Franchise tax 647,890 581,990 496,338 Other 1,877,460 1,614,584 1,475,833 ----------- ----------- ----------- Total noninterest expense 16,509,205 14,138,635 12,217,410 ----------- ----------- ----------- Income before federal income taxes 12,220,220 10,808,622 10,001,170 Federal income taxes: Current 3,966,092 3,431,586 3,128,578 Deferred 157,672 203,727 236,714 ----------- ----------- ----------- 4,123,764 3,635,313 3,365,292 ----------- ----------- ----------- Net income $ 8,096,456 $ 7,173,309 $ 6,635,878 =========== =========== =========== Basic earnings per share $ 1.27 $ 1.12 $ 1.05 =========== =========== =========== Diluted earnings per share $ 1.25 $ 1.09 $ 1.02 =========== =========== ===========

- -------------------------------------------------------------------------------- See accompanying notes to consolidated financial statements. 23 PVF CAPITAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY Years ended June 30, 2003, 2002 and 2001

Additional Common Paid-In Retained Treasury Stock Capital Earnings Stock Total ----- ------- -------- ----- ----- Balance at June 30, 2000 $ 48,333 24,784,942 19,039,966 (973,178) 42,900,063 Net income -- -- 6,635,878 -- 6,635,878 Stock options exercised, 20,384 shares 204 38,201 -- -- 38,405 Cash paid in lieu of fractional shares -- -- (1,840) -- (1,840) Stock dividend issued, 485,730 shares 4,857 6,523,354 (6,528,211) -- -- Cash dividend, $0.292 per share -- -- (1,376,934) -- (1,376,934) Purchase of 21,488 shares of Treasury stock -- -- (189,437) (189,437) ----------- ---------- ---------- ---------- ---------- Balance at June 30, 2001 53,394 31,346,497 17,768,859 (1,162,615) 48,006,135 Net income -- -- 7,173,309 7,173,309 Stock options exercised, 173,492 shares 1,735 293,425 -- -- 295,160 Cash paid in lieu of fractional shares -- -- (2,869) (2,869) Stock dividend issued, 551,870 shares 5,519 5,772,560 (5,778,079) -- -- Cash dividend, $0.296 per share -- -- (1,533,555) (1,533,555) Purchase of 136,395 shares of Treasury stock -- -- -- (1,639,602) (1,639,602) ----------- ---------- ---------- ---------- ---------- Balance at June 30, 2002 60,648 37,412,482 17,627,665 (2,802,217) 52,298,578 Net income 8,096,456 -- 8,096,456 Stock options exercised, 41,909 shares 419 187,502 -- -- 187,921 Cash paid in lieu of fractional shares -- (2,159) -- (2,159) Stock dividend issued, 610,565 shares 6,106 9,576,712 (9,582,818) -- -- Cash dividend, $0.296 per share -- (1,652,684) -- (1,652,684) Purchase of 28,615 shares of Treasury stock -- -- -- (324,976) (324,976) ----------- ---------- ---------- ---------- ---------- Balance at June 30, 2003 $ 67,173 47,176,696 14,486,460 (3,127,193) 58,603,136 =========== ========== ========== ========== ==========

- -------------------------------------------------------------------------------- See accompanying notes to consolidated financial statements. 24 PVF CAPITAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Years ended June 30, 2003, 2002 and 2001 - --------------------------------------------------------------------------------

2003 2002 2001 ----------- ----------- ----------- Operating activities: Net income $ 8,096,456 7,173,309 6,635,878 Adjustments required to reconcile net income to net cash provided by (used in) operating activities: Accretion of discount on securities - - (618,845) Depreciation 1,407,503 1,060,530 710,375 Provision for loan losses - 558,000 225,000 Accretion of unearned discount and deferred loan origination fees, net (1,244,214) (1,130,822) (1,132,931) FHLB stock dividends (448,775) (505,319) (525,378) Deferred income tax provision (157,672) (203,727) (236,714) Proceeds from loans held for sale 460,462,639 295,706,407 106,047,642 Originations of loans held for sale (475,659,784) (301,234,328) (101,461,735) Gain on the sale of loans, net (6,727,015) (2,981,311) (633,362) Net change in other assets and other liabilities 12,726,270 (1,213,531) 4,356,135 ----------- ----------- ----------- Net cash from operating activities (1,544,592) (2,770,792) 13,366,065 ----------- ----------- ----------- Investing activities: Loans originated (177,261,741) (135,864,877) (226,319,550) Principal repayments on loans 162,351,576 149,065,323 147,331,835 Principal repayments on mortgage-backed securities held to maturity 4,366,663 10,918,228 3,926,715 Purchase of mortgage-backed securities held to maturity - - (977,611) Purchase of securities held to maturity (30,000,000) (55,000,000) (99,918,836) Maturities and calls of securities held to maturity 85,087,959 50,090,394 115,584,929 Federal Home Loan Bank (FHLB) stock purchased, net - - (3,075,700) Additions to office properties and equipment (3,146,074) (3,094,421) (6,636,488) Disposals of real estate owned 114,259 353,100 740,442 (Additions) disposal of real estate held for investment, net (50,000) (350,000) 2,794,020 ----------- ----------- ----------- Net cash from investing activities 41,462,642 16,117,747 (66,550,244) ----------- ----------- -----------

- -------------------------------------------------------------------------------- See accompanying notes to consolidated financial statements. 25 PVF CAPITAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED) Years ended June 30, 2003, 2002 and 2001 - --------------------------------------------------------------------------------

2003 2002 2001 ---- ---- ---- Financing activities: Payments on FHLB advances (10,616,476) (183,127,160) (89,106,985) Proceeds from FHLB advances 10,000,000 118,000,000 160,000,000 Proceeds from notes payable - 6,650,000 4,700,000 Repayment of notes payable (2,472,870) (3,061,980) (1,000,000) Net increase in NOW and passbook savings 16,190,703 23,728,050 2,913,422 Proceeds from issuance of certificates of deposit 135,463,914 88,664,759 124,038,791 Payments on maturing certificates of deposit (104,897,908) (113,252,740) (87,401,922) Net increase in advances from borrowers 644,040 851,552 293,943 Payment of cash dividend (1,654,844) (1,536,424) (1,378,774) Purchase of Treasury stock (324,975) (1,639,602) (189,437) Other 187,921 295,160 38,404 ------------- ---------- ---------- Net cash from financing activities 42,519,505 (64,428,385) 112,907,442 ------------- ---------- ---------- Net increase (decrease) in cash and cash equivalents 82,437,555 (51,081,430) 59,723,263 Cash and cash equivalents at beginning of year 14,313,688 65,395,118 5,671,855 ------------- ---------- ---------- Cash and cash equivalents at end of year $ 96,751,243 14,313,688 65,395,118 ============= ========== ========== Supplemental disclosures of cash flow information: Cash payments of interest $ 20,733,040 28,600,682 32,577,423 Cash payments of income taxes 4,020,000 2,825,000 3,399,482 Supplemental schedule of noncash investing and financing activities: Transfers to real estate owned $ - 355,132 742,981 Loans securitized into mortgage-backed securities - - 16,400,000

- -------------------------------------------------------------------------------- See accompanying notes to consolidated financial statements. 26 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS The accounting and reporting policies of PVF Capital Corp. and its subsidiaries (Company) conform to accounting principles generally accepted in the United States of America and general industry practice. The Company's principal subsidiary, Park View Federal Savings Bank (Bank), is principally engaged in the business of offering savings deposits through the issuance of savings accounts, money market accounts, and certificates of deposit and lending funds primarily for the purchase, construction, and improvement of real estate in Cuyahoga, Summit, Geauga, Lake, Medina and Lorain Counties, Ohio. The deposit accounts of the Bank are insured under the Savings Association Insurance Fund (SAIF) of the Federal Deposit Insurance Corporation (FDIC) and are backed by the full faith and credit of the United States government. The following is a description of the significant policies, which the Company follows in preparing and presenting its consolidated financial statements. Principles of Consolidation. The consolidated financial statements include the accounts of PVF Capital Corp., and its wholly owned subsidiaries, Park View Federal Savings Bank, PVF Service Corporation (PVFSC), PVF Holding, Inc., and Mid-Pines Land Co. PVFSC owns some bank premises and leases them to the bank. PVF Holding Inc. and Mid Pines Land Co. did not have any significant assets or activity as of or for the years ended June 30, 2003 or 2002. All significant intercompany transactions and balances are eliminated in consolidation. Use of Estimates. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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. The allowance for loan losses and fair value of financial instruments are particularly subject to change. Allowance for Loan Losses. A loan is considered impaired when, based on current information and events, it is probable that the Bank will be unable to collect the scheduled payments of principal and interest according to the contractual terms of the loan agreement. Since the Bank's loans are primarily collateral dependent, measurement of impairment is based on the fair value of the collateral. The allowance for loan losses is maintained at a level to absorb probable incurred losses inherent in the portfolio as of the balance sheet date. The adequacy of the allowance for loan losses is periodically evaluated by the Bank based upon the overall portfolio composition and general market conditions. While management uses the best information available to make these evaluations, future adjustments to the allowance may be necessary if economic conditions change substantially from the assumptions used in making the evaluations. Allocations of the allowance - -------------------------------------------------------------------------------- (Continued) 27 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS (Continued) may be made for specific loans, but the entire allowance is available for any loan that, in management's judgment, should be charged-off. Loan losses are charged against the allowance when management believes the uncollectibility of a loan balance is confirmed. Future adjustments to the allowance may also be required by regulatory examiners based on their judgments about information available to them at the time of their examination. Uncollectable interest on loans that are contractually 90 days or more past due is charged off, or an allowance is established. The allowance is established by a charge to interest income equal to all interest previously accrued, and income is subsequently recognized only to the extent cash payments are received until the loan is determined to be performing in accordance with the applicable loan terms in which case the loan is returned to accrual status. Mortgage Banking Activities. Mortgage loans held for sale are carried at the lower of cost or fair value, determined on an aggregate basis. The Company retains servicing on loans that are sold. The Company recognizes an asset for mortgage servicing rights based on an allocation of total loan cost using relative fair values, or a liability for mortgage servicing rights based on fair value, if the benefits of servicing are not expected to adequately compensate the Company. The cost of mortgage servicing rights is amortized in proportion to, and over the period of, estimated net servicing revenues. Impairment of mortgage servicing rights is assessed based on the fair value of those rights. Fair values are estimated using discounted cash flows based on current market interest rates and prepayment assumptions. For purposes of measuring impairment, the rights are stratified based on predominant risk characteristics of the underlying loans such as interest rates and scheduled maturity. The amount of impairment recognized is the amount by which the capitalized mortgage servicing rights exceed their fair value. The Company monitors prepayments, and in the event that actual prepayments exceed original estimates, amortization is adjusted accordingly. Investment and Mortgage-Backed Securities. The Company classifies all securities as held to maturity. Securities held to maturity are limited to debt securities that the Company has the positive intent and the ability to hold to maturity; these securities are reported at amortized cost. Investment and mortgage-backed securities that could be sold in the future because of changes in interest rates or other factors are not to be classified as held to maturity. Other securities such as Federal Home Loan Bank stock are carried at cost. Gains or losses on the sales or call of all securities are recognized at the date of sale or call (trade date). Premiums and discounts are amortized or accreted over the life of the related security as an adjustment to yield. Dividends and interest income are recognized when earned. - -------------------------------------------------------------------------------- (Continued) 28 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS (Continued) A decline in fair value of any held to maturity security below cost that is deemed other than temporary is charged to earnings resulting in establishment of a new cost basis for the security. Loans Receivable: Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at the principal balance outstanding, net of unearned interest, deferred loan fees and costs, and an allowance for loan losses. Office Properties and Equipment. Depreciation and amortization are computed using the straight-line method at rates expected to amortize the cost of the assets over their estimated useful lives or, with respect to leasehold improvements, the term of the lease, if shorter. Estimated lives range from one to forty years. Land is carried at cost. Federal Income Taxes. The Company files a consolidated tax return with its wholly owned subsidiaries and provides deferred federal income taxes in recognition of temporary differences between financial statement and income tax reporting. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled, and the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Loan Origination and Commitment Fees. The Company defers loan origination and commitment fees and certain direct loan origination costs and amortizes the net amount over the lives of the related loans as a yield adjustment if the loans are held for investment, or recognizes the net fees as mortgage banking income when the loans are sold. Real Estate Owned. Real estate owned is carried at the lower of cost or fair value less estimated selling costs. If Fair values decline, a valuation allowance is recorded through expense. Costs after acquisition are expensed. Long-Term Assets. Office properties and equipment and other long-term assets are reviewed for impairment when events indicate their carrying amount may not be recoverable from future undiscounted cash flows. If impaired, the assets are recorded at fair value. - -------------------------------------------------------------------------------- (Continued) 29 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS (Continued) Statements of Cash Flows. For purposes of the consolidated statements of cash flows, the Company considers cash and amounts due from depository institutions, interest bearing deposits, and federal funds sold with original maturities of less than three months to be cash equivalents. Net cash flows are reported for NOW and passbook savings accounts, and advances from borrowers. Stock Compensation. Employee compensation expense under stock option plans is reported if options are granted below market price at grant date. No stock-based compensation cost is reflected in net income, as all options granted had an exercise price equal to or greater than the market price of the underlying stock at the date of grant. The following table illustrates the effect on net income and earnings per share if expense was measured using the fair value recognition provisions of FASB Statement No. 123, Accounting for Stock-Based Compensation.

2003 2002 2001 ---- ---- ---- Net income as reported $ 8,096,456 7,173,309 6,635,878 Deduct: Stock-based compensation expense $ 124,135 104,521 129,146 determined under fair value based method $ 7,972,321 7,068,788 6,506,732 Pro forma net income Basic earnings per share as reported $ 1.27 1.12 1.05 Pro forma basic earnings per share $ 1.25 1.11 1.03 Diluted earnings per share as reported $ 1.25 1.09 1.02 Pro forma diluted earnings per share $ 1.23 1.08 1.00

The pro forma effects are computed using option pricing models, using the following weighted-average assumptions as of grant date.

2003 2002 2001 ---- ---- ---- Risk-free interest rate 3.50% 4.73% 5.71% Expected option life 7 years 7 years 7 years Expected stock price volatility 35.00% 37.00% 30.00% Dividend yield 2.50% 2.73% 2.00%

- -------------------------------------------------------------------------------- (Continued) 30 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS (Continued) Earnings Per Share. Earnings per share are calculated by dividing net income for the period by the weighted average number of shares of common stock outstanding during the period. The assumed exercise of stock options is included in the calculation of diluted earnings per share. The per share data for 2003, 2002 and 2001 are adjusted to reflect the 10% stock dividends declared July 2003, July 2002 and July 2001. Loss Contingencies. Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Management does not believe there now are such matters that will have a material effect on the financial statements. Off Balance Sheet Financial Instruments: Financial instruments include off-balance sheet credit instruments, such as commitments to make loans issued to meet customer financing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. Such financial instruments are recorded when they are funded. Restrictions on Cash: Cash on deposit with another institution of $1,096,000 was required to meet regulatory reserve requirements at June 30, 2003. These balances do not earn interest. No cash on deposit with other institution was required to meet regulatory reserve requirements at June 30, 2002. Fair Value of Financial Instruments. Fair values of financial instruments are estimated using relevant market information and other assumptions, as more fully disclosed in a separate note. Fair value estimates involve uncertainties and matters of significant judgment regarding interest rates, credit risk, prepayments, and other factors, especially in the absence of broad markets for particular items. Changes in assumptions or in market conditions could significantly affect the estimates. Operating Segments. While the Company's chief decision-makers monitor the revenue streams of the various Company products and services, the identifiable segments are not material and operations are managed and financial performance is evaluated on a Company-wide basis. Accordingly, all of the Company's financial service operations are considered by management to be aggregated in one reportable operating segment. Reclassifications. Certain reclassifications have been made to the prior year amounts to conform to the current year presentation. - -------------------------------------------------------------------------------- (Continued) 31 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 NOTE 2 - SECURITIES Securities held to maturity at June 30, 2003 and 2002, are summarized as follows: 2003 ---- Gross Gross Amortized Unrealized Unrealized Estimated Cost Gain Loss Fair Value ---- ---- ---- ---------- Municipal bond $ 33,252 - - $ 33,252 ----------- ----------- ----------- ----------- Total $ 33,252 - - $ 33,252 =========== =========== =========== =========== Due after one year through five years $ 33,252 - - $ 33,252 =========== =========== =========== ===========

2002 ---- Gross Gross Amortized Unrealized Unrealized Estimated Cost Gain Loss Fair Value ---- ---- ---- ---------- United States Government and agency securities $55,000,000 $ 639,100 $ (8,750) $55,630,350 Municipal bond 121,211 - - 121,211 ----------- ----------- ----------- ----------- Total $55,121,211 $ 639,100 $ (8,750) $55,751,561 =========== =========== =========== =========== Due after one year through five years $55,121,211 $ 639,100 $ (8,750) $55,751,561 =========== =========== =========== ===========

There were no sales of securities for the years ended June 30, 2003, 2002 or 2001. $85,000,000 of United States Agency securities were called in the year ended June 30, 2003. - -------------------------------------------------------------------------------- (Continued) 32 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 NOTE 3 - MORTGAGE-BACKED SECURITIES Mortgage-backed securities held to maturity at June 30, 2003 and 2002, are summarized as follows:

2003 ---- Gross Gross Amortized Unrealized Unrealized Estimated Cost Gain Loss Fair Value ---- ---- ---- ---------- FNMA mortgage-backed securities $ 89,721 $ 2,909 - $ 92,630 FHLMC mortgage-backed securities 2,840,822 98,934 - 2,939,756 Accrued interest receivable 34,255 - - 34,255 ----------- ----------- ----------- ----------- $ 2,964,798 $ 101,843 - $ 3,066,641 =========== =========== =========== ===========

2002 ---- Gross Gross Amortized Unrealized Unrealized Estimated Cost Gain Loss Fair Value ---- ---- ---- ---------- FNMA mortgage-backed securities $ 188,732 $ 3,564 - $ 192,296 FHLMC mortgage-backed securities 7,022,569 199,969 - 7,222,538 Accrued interest receivable 85,905 - - 85,905 ----------- ----------- ----------- ----------- $ 7,297,206 $ 203,533 - $ 7,500,739 =========== =========== =========== ===========

There were no sales of mortgage-backed securities for the years ended June 30, 2003, 2002 or 2001. - -------------------------------------------------------------------------------- (Continued) 33 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 4 - LOANS RECEIVABLE Loans receivable at June 30, 2003 and 2002, consist of the following:

2003 2002 ---- ---- Real estate mortgages: One-to-four family residential $ 143,881,760 $ 158,833,656 Home equity line of credit 67,822,058 53,349,287 Multifamily residential 40,997,490 43,451,715 Commercial 147,560,511 133,145,924 Commercial equity line of credit 34,080,887 22,872,121 Land 62,933,365 60,124,877 Construction - residential 111,388,555 110,596,307 Construction - multi-family 304,300 1,084,805 Construction - commercial 22,935,858 33,451,289 ------------- ------------- Total real estate mortgages 631,904,784 616,909,981 Non real estate loans 11,760,915 8,459,413 ------------- ------------- 643,665,699 625,369,394 Accrued interest receivable 2,685,565 2,973,654 Deferred loan origination fees (3,032,489) (2,789,665) Unearned discount (2,276) (3,085) Undisbursed portion of loan proceeds (59,762,979) (58,097,903) Allowance for loan losses (3,882,839) (3,901,839) ------------- ------------- $ 579,670,681 $ 563,550,556 ============= =============

A summary of the changes in the allowance for loan losses for the years ended June 30, 2003, 2002, and 2001, is as follows:

2003 2002 2001 ---- ---- ---- Beginning balance $ 3,901,839 $ 3,520,198 $ 3,387,474 Provision charged to operations - 558,000 225,000 Charge-offs (19,000) (206,078) (112,435) Recoveries - 29,719 20,159 ----------- ----------- ----------- Ending balance $ 3,882,839 $ 3,901,839 $ 3,520,198 =========== =========== ===========

- -------------------------------------------------------------------------------- (Continued) 34 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 4 - LOANS RECEIVABLE (Continued) The following is a summary of the principal balances of nonperforming loans at June 30:

2003 2002 ---- ---- Loans on nonaccrual status: Real estate mortgages: One-to-four family residential $3,072,917 $2,677,504 Commercial 2,879,445 1,215,160 Multi-family residential 137,085 115,362 Construction and land 1,347,905 3,796,980 ---------- ---------- Total loans on nonaccrual status 7,437,352 7,805,006 ---------- ---------- Past due loans on accrual status - Real estate mortgages - Construction and land 275,461 - ---------- ---------- Total nonaccrual and past due loans $7,712,813 $7,805,006 ========== ==========

During the years ended June 30, 2003, 2002 and 2001, gross interest income of $761,798, $548,000, and $769,931, respectively, would have been recorded on loans accounted for on a nonaccrual basis if the loans had been current throughout the period. Nonperforming loans and impaired loans are defined differently. Some loans may be included in both categories, whereas other loans may only be included in one category. At June 30, 2003 and 2002, the recorded investment in loans, which have been identified as being impaired, totaled $12,765,000 and $13,016,000 respectively. Included in the impaired amount at June 30, 2003 and 2002, is $1,095,934 and $115,362, respectively, related to loans with a corresponding valuation allowance of $234,719 and $29,719 respectively. The Company recognized no interest on impaired loans in 2003, 2002, and 2001 (during the portion of the respective years that they were impaired). Average impaired loans for the years ended June 30, 2003 and 2002 amounted to $13,296,000 and $6,983,200, respectively. - -------------------------------------------------------------------------------- (Continued) 35 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 5 - MORTGAGE BANKING ACTIVITIES Mortgage banking activities, net, including gains and losses on sales of loans, for each of the years in the three-year period ended June 30, 2003, consist of the following:

2003 2002 2001 ---- ---- ---- Mortgage loan servicing fees $ 1,446,168 $ 1,116,929 $ 810,567 Amortization and impairment of mortgage servicing rights (3,251,114) (1,112,817) (354,424) Gross realized: Gains on sales of loans 8,214,611 3,079,814 1,766,805 Losses on sales of loans (1,487,596) (98,502) (1,133,443) Market valuation provision for losses on loans receivable held for sale - - - Market valuation recoveries - - 45,000 ----------- ----------- ----------- $ 4,922,069 $ 2,985,424 $ 1,134,505 =========== =========== ===========

At June 30, 2003 and 2002, the Company was servicing whole and participation mortgage loans for others aggregating approximately $658,967,272 and $528,319,233, respectively. The Company had $20,143,571 and $6,069,959 at June 30, 2003 and 2002, respectively, of funds collected on mortgage loans serviced for others which is included in accrued expenses and other liabilities. Originated mortgage servicing rights capitalized and amortized during the years ended June 30, 2003, 2002 and 2001 were as follows:

2003 2002 2001 ---- ---- ---- Beginning balance $ 3,255,147 $ 1,284,678 $ 833,558 Originated 3,981,149 3,083,286 805,544 Amortized (2,581,114) (1,112,817) (354,424) ----------- ---------- ---------- Ending balance $ 4,655,182 $ 3,255,147 $ 1,284,678 =========== ========== ========== Valuation allowance Beginning of year $ - $ - $ - Additions expensed 670,000 $ - - End of year $ 670,000 $ - $ - =========== ========== ==========

- -------------------------------------------------------------------------------- (Continued) 36 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 6 - OFFICE PROPERTIES AND EQUIPMENT Office properties and equipment at cost, less accumulated depreciation and amortization at June 30, 2003 and 2002 are summarized as follows:

2003 2002 ---- ---- Land and land improvements $ 847,500 $ 847,500 Building and building improvements 4,702,678 4,715,304 Leasehold improvements 4,966,034 3,793,711 Furniture and equipment 8,436,598 6,532,717 ------------ ------------ 18,952,810 15,889,232 Less accumulated depreciation and amortization (7,396,891) (6,071,884) ------------ ------------ $ 11,555,919 $ 9,817,348 ============ ============

NOTE 7 - DEPOSITS Deposit balances at June 30, 2003 and 2002 are summarized by interest rate as follows:

2003 2002 ---- ---- Amount % Amount % ------ - ------ - NOW and money market accounts Noninterest bearing $ 14,682,098 2.8% $ 12,092,628 2.5% 0.245-4.00% 66,389,265 12.6 58,813,116 12.3 ------------ ---- ------------ ---- 81,071,363 15.4 70,905,744 14.8 Passbook savings 1.00 - 2.50% 43,191,519 8.2 37,166,435 7.7 Certificates of deposit 0.50 - 1.99% 71,825,960 13.6 - - 2.00 - 2.99 100,173,672 19.0 91,168,895 19.0 3.00 - 3.99 147,737,107 28.1 117,780,641 24.6 4.00 - 4.99 53,456,947 10.2 49,071,134 10.2 5.00 - 5.99 20,956,710 4.0 26,261,752 5.5 6.00 - 6.99 6,283,529 1.2 43,549,703 9.1 7.00 - 7.99 1,651,935 0.3 43,693,887 9.1 8.00 - 8.99 80,185 0.0 74,027 0.0 ------------ ---- ------------ ---- 402,166,045 84.6 371,600,039 85.2 ------------ ---- ------------ ---- $526,428,927 100% $479,672,218 100% ============ ==== ============ ==== Weighted average rate on deposits 2.61% 3.76% ==== ====

- -------------------------------------------------------------------------------- (Continued) 37 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 7 - DEPOSITS (Continued)

2003 2002 ---- ---- Amount % Amount % ------ - ------ - Remaining term to maturity of certificates of deposit: 12 months or less $249,316,121 62.0% $254,171,324 68.4% 13 to 24 months 115,880,269 28.8 77,333,220 20.8 25 to 36 months 13,613,069 3.4 24,414,990 6.6 37 to 48 months 23,356,586 5.8 15,680,505 4.2 ------------ --- ------------ --- $402,166,045 100% $371,600,039 100% ============ === ============ === Weighted average rate on certificates of deposit 3.23% 4.57% ==== ====

Time deposits in amounts of $100,000 or more totaled approximately $109,893,000 and $105,828,000 at June 30, 2003 and 2002, respectively. Interest expense on deposits is summarized as follows:

2003 2002 2001 ---- ---- ---- NOW accounts $ 899,621 $ 1,079,276 $ 1,292,321 Passbook accounts 470,504 660,260 771,793 Certificates of deposit 13,799,377 19,255,467 25,015,617 ----------- ----------- ----------- $15,169,502 $20,995,003 $27,079,731 =========== =========== ===========

NOTE 8 - ADVANCES FROM THE FEDERAL HOME LOAN BANK OF CINCINNATI Advances from the Federal Home Loan Bank of Cincinnati (FHLB), with maturities and interest rates thereon at June 30, 2003 and 2002, were as follows:

Maturity Interest Rate 2003 2002 - -------- ------------- ---- ---- February 2003 6.00 $ - $ 500,000 February 2006 6.05 123,220 239,695 February 2008 5.37 10,000,000 10,000,000 March 2008 5.64 10,000,000 10,000,000 March 2011 3.94 50,000,000 50,000,000 May 2011 4.16 50,000,000 50,000,000 ------------ ------------ $120,123,220 $120,739,695 ============ ============ Weighted average interest rate 4.29% 4.30% ==== ====

- -------------------------------------------------------------------------------- (Continued) 38 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 8 - ADVANCES FROM THE FEDERAL HOME LOAN BANK OF CINCINNATI (Continued) Each of the advances, except the advance maturing in February 2006, is a convertible fixed-rate advance. Each of these is convertible at the option of the FHLB to LIBOR. Alternatively, if the conversion option is exercised, the Bank could repay these advances without prepayment penalty. In order to secure these advances, the Bank has pledged mortgage loans with unpaid principal balances aggregating approximately $113,341,000 and $150,925,000 at June 30, 2003 and 2002, respectively, plus Federal Home Loan Bank stock. In addition, at June 30, 2003, $21,000,000 in overnight cash and stock in the FHLB was pledged for such advances. NOTE 9 - NOTES PAYABLE On July 26, 2000, the Company secured a $5 million line of credit from another federally insured institution at a variable interest rate that adjusts to LIBOR plus 200 basis points. Each draw is separately negotiated with respect to rate and term. The outstanding balance at June 30, 2003 and June 30, 2002 was $2,500,000 and $4,900,000, respectively. The line was extended in July 2003 for an additional year and can be extended indefinitely. The line is secured by all of the Company's stock in the Bank. On March 8, 2002, one of the Company's subsidiaries obtained a $3.4 million term loan from another federally insured institution to refinance the Company's Solon headquarters building. The note carries a variable interest rate that adjusts to LIBOR plus 230 basis points. The loan matures on March 15, 2007. The loan is guaranteed by the Company. Principal repayments on the note are scheduled as follows: 2004 $78,900 2005 85,470 2006 92,520 2007 3,058,260 ---------- $3,315,150 ========== - -------------------------------------------------------------------------------- (Continued) 39 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 10 - FEDERAL INCOME TAXES The provision for federal income taxes differs from the amounts computed by applying the U.S. federal income tax statutory rate to income before federal income taxes. These differences are reconciled as follows:

2003 2002 2001 ---- ---- ---- Amount % Amount % Amount % ------ - ------ - ------ - Computed expected tax $4,277,077 35.0% $3,783,018 35.0% $3,500,410 35.0% Decrease in tax resulting from: Benefit of graduated rates (100,000) (1.0) (100,000) (1.0) (100,000) (1.0) Tax credits (111,646) (0.9) (111,646) (1.0) (111,646) (1.1) Other, net 58,333 0.6 63,941 0.6 76,528 0.8 ---------- ---- ---------- ---- ---------- ---- $4,123,764 33.7% $3,635,313 33.6% $3,365,292 33.7% ========== ==== ========== ==== ========== ====

The net tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities at June 30, 2003 and 2002 are:

2003 2002 ---- ---- Deferred tax assets: Loan loss and other reserves $ 1,294,629 $ 1,345,883 Deferred Compensation 426,964 428,385 Unrealized gains on loans held for sale 364,130 91,637 Other 36,909 25,737 ----------- ----------- Total gross deferred tax assets 2,122,632 1,891,642 Deferred tax liabilities: Deferred loan fees, net 358,953 309,847 FHLB stock dividend 1,187,603 1,034,365 Originated mortgage servicing asset 1,354,962 1,106,750 Fixed assets 728,809 798,412 Other 187,666 193,413 ----------- ----------- Total gross deferred tax liabilities 3,817,993 3,442,787 ----------- ----------- Net deferred tax liability $(1,695,361) $(1,551,145) =========== ===========

A valuation allowance is established to reduce the deferred tax asset if it is more likely than not that the related tax benefits will not be realized. In management's opinion, it is more likely than not that the tax benefits will be realized; consequently, no valuation allowance has been established as of June 30, 2003 or 2002. - -------------------------------------------------------------------------------- (Continued) 40 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 10 - FEDERAL INCOME TAXES (continued) Retained earnings at June 30, 2003 include approximately $4,516,000 for which no provision for federal income tax has been made. This amount represents allocations of income during years prior to 1988 to bad debt deductions for tax purposes only. These qualifying and nonqualifying base year reserves and supplemental reserves will be recaptured into income in the event of certain distributions and redemptions. Such recapture would create income for tax purposes only, which would be subject to the then current corporate income tax rate. Recapture would not occur upon the reorganization, merger, or acquisition of the Bank, nor if the Bank is merged or liquidated tax-free into a bank or undergoes a charter change. If the Bank fails to qualify as a bank or merges into a nonbank entity, these reserves will be recaptured into income. The favorable reserve method previously afforded to thrifts was repealed for tax years beginning after December 31, 1995. Large thrifts were required to switch to the specific charge-off method of section 166. In general, a thrift is required to recapture the amount of its qualifying and nonqualifying reserves in excess of its qualifying and nonqualifying base year reserves. The Bank has no such excess reserves to recapture. NOTE 11 - LEASES The Company leases certain premises from unaffiliated parties. Future minimum payments under noncancelable operating leases with initial or remaining terms of one year or more consisted of the following at June 30, 2003: Year Ending June 30, 2004 $ 581,014 2005 464,491 2006 374,602 2007 374,602 2008 338,874 Thereafter 702,739 ---------- Total minimum lease payments $2,836,322 ========== During the years ended June 30, 2003, 2002, and 2001, rental expense was $647,596, $555,030, and $809,169, respectively. - -------------------------------------------------------------------------------- (Continued) 41 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 12 - COMMITMENTS AND CONTINGENCIES In the normal course of business, the Bank enters into commitments with off-balance sheet risk to meet the financing needs of its customers. Commitments to extend credit involve elements of credit risk and interest rate risk in excess of the amount recognized in the consolidated statements of financial condition. The Bank's exposure to credit loss in the event of nonperformance by the other party to the commitment is represented by the contractual amount of the commitment. The Bank uses the same credit policies in making commitments as it does for on-balance sheet instruments. Interest rate risk on commitments to extend credit results from the possibility that interest rates may have moved unfavorably from the position of the Bank since the time the commitment was made. 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 of 60 to 120 days or other termination clauses and may require payment of a fee. Since some of the commitments may 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 of collateral obtained by the Bank upon extension of credit is based on management's credit evaluation of the applicant. Collateral held is generally residential and commercial real estate. The Bank's lending is concentrated in Northeastern Ohio, and as a result, the economic conditions and market for real estate in Northeastern Ohio could have a significant impact on the Bank. At June 30, 2003 and 2002, the Bank had the following commitments:

2003 2002 ---- ---- Commitments to sell mortgage loans in the secondary market $89,630,300 $25,733,000 Commitments to fund variable mortgage loans 12,669,150 14,173,479 Commitments to fund fixed mortgage loans 66,782,101 30,247,388

The fixed rate loan commitments have interest rates ranging from 3.75% to 7.125%. There are pending against the Company various lawsuits and claims which arise in the normal course of business. In the opinion of management, any liabilities that may result from pending lawsuits and claims will not materially affect the financial position of the Company. (Continued) - -------------------------------------------------------------------------------- 42 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 13 - REGULATORY CAPITAL The Company 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 Company's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company must meet specific capital guidelines that involve quantitative measures of the Company's assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. The Company's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Office of Thrift Supervision (OTS) regulations requires savings institutions to maintain certain minimum levels of regulatory capital. An institution that fails to comply with its regulatory capital requirements must obtain OTS approval of a capital plan and can be subject to a capital directive and certain restrictions on its operations. At June 30, 2003, the minimum regulatory capital regulations require institutions to have equity capital to total tangible assets of 1.5%; a minimum leverage ratio of core (Tier 1) capital to total adjusted tangible assets of 4.0%; and a minimum ratio of total capital to risk weighted assets of 8.0%. At June 30, 2003, the Bank exceeded all of the aforementioned regulatory capital requirements. Regulations limit capital distributions by savings institutions. Generally, capital distributions are limited to undistributed net income for the current and prior two years. At June 30, 2003, these limitations are not expected to prevent the company from paying its normal cash dividends. The most recent notification from the Office of Thrift Supervision categorized the Company as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized the Company must maintain minimum total risk-based, Tier 1 risk-based, and Tier 1 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. - -------------------------------------------------------------------------------- (Continued) 43 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 13 - REGULATORY CAPITAL (Continued) At June 30, 2003 and 2002, the Bank was in compliance with regulatory capital requirements as set forth below (dollars in thousands):

Core/ Tier-1 Total Equity Leverage Risk-Based Risk-Based Capital Capital Capital Capital ------- ------- ------- ------- June 30, 2003: GAAP capital $ 57,656 57,656 57,656 57,656 Nonallowable component - (108) (108) (108) General loan valuation allowances - - - 3,648 ------- ------- ------- ------- Regulatory capital 57,656 57,548 57,548 61,196 Total assets 744,105 744,105 744,105 744,105 Adjusted total assets - 743,997 - - Risk-weighted assets - - 535,618 535,618 Actual capital ratio 7.75% 7.73% 10.74% 11.43% Regulatory requirement for capital adequacy purposes 1.50% 4.00% 8.00% Regulatory capital category - well-capitalized - equal to or greater than 5.00% 6.00% 10.00%

Core/ Tier-1 Total Equity Leverage Risk-Based Risk-Based Capital Capital Capital Capital ------- ------- ------- ------- June 30, 2002: GAAP capital $ 53,553 53,553 53,553 53,553 Nonallowable component - (159) (159) (159) General loan valuation allowances - - - 3,872 ------- ------- ------- ------- Regulatory capital 53,553 53,394 53,394 57,266 Total assets 677,517 677,517 677,517 677,517 Adjusted total assets - 677,358 - - Risk-weighted assets - - 492,378 492,378 Actual capital ratio 7.90% 7.88% 10.84% 11.63% Regulatory requirement for capital adequacy purposes 1.50% 4.00% 8.00% Regulatory capital category - well-capitalized - equal to or greater than 5.00% 6.00% 10.00%

- -------------------------------------------------------------------------------- (Continued) 44 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 14 - RELATED PARTY TRANSACTIONS Loans to principal officers, directors, and their affiliates in 2003 were as follows. Beginning balance $ 4,467,000 New Loans 3,110,000 Repayments (1,803,000) ----------- Ending balance $ 5,774,000 =========== NOTE 15 - STOCK OPTIONS The Bank offered stock options to the directors and officers of the bank under a 1992 plan, a 1996 plan, and a 2000 plan. All of the options authorized under the 1992 have been granted and exercised. The options granted under the 1996 plan are exercisable over a ten-year period, with a vesting period ranging from zero to five years as stated in the individual option agreements. The options granted under the 2000 plan are exercisable over a ten-year period and can be exercised at any time. Options were granted at fair market value and, accordingly, no charges were reflected in compensation and benefits expense due to the granting of stock options. The excess of the option price over the par value of the shares purchased through the exercise of stock options is credited to additional paid in capital. A summary of the activity in the plan is as follows:

2003 2002 2001 ---- ---- ---- Average Average Average Option Option Option Shares Price Shares Price Shares Price ------- ------ ------- ------ ------- ------ Outstanding beginning of year 385,799 $ 8.27 553,029 $ 4.90 490,936 $ 4.21 Exercised (66,095) 5.51 (239,588) 1.95 (27,683) 1.38 Expired (5,018) 9.72 - - - - Granted 53,240 10.31 72,358 8.96 89,776 7.87 ------- ------ ------- ------ ------- ------ Outstanding end of year 367,926 $ 8.38 385,799 $ 8.27 553,029 $ 4.90 ======= ====== ======= ====== ======= ====== Exercisable end of year 264,622 $ 7.99 227,775 $ 7.67 444,109 $ 4.12 ======= ====== ======= ====== ======= ====== Weighted average fair value of options granted during the year $ 3.55 $ 3.68 $ 3.43

- -------------------------------------------------------------------------------- (Continued) 45 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 15 - STOCK OPTIONS (Continued) Options outstanding at June 30, 2003 were as follows:

Outstanding Exercisable ----------- ----------- Weighted Average Weighted Range of Remaining Average Exercise Contractual Exercise Price Number Life Number Price - --------------- ---------------- ------------------ $5.63 - $7.37 110,943 5.03 110,650 $ 6.66 $7.38 - $9.19 176,771 6.11 107,160 8.35 $9.39 - $11.26 80,212 7.65 46,812 10.31 ---------------- ------------------ Total 367,926 6.12 264,622 $ 7.99 ================ ==================

NOTE 16 - EARNINGS PER SHARE The following is a reconciliation of basic earnings per share to diluted earnings per share for the years ended June 30:

2003 ---- Per-Share Net Income Shares Amount ---------- ------ ------ Basic EPS: Income available to common shareholders $8,096,456 6,368,231 $ 1.27 Dilute effects of assumed exercises of stock options - 100,648 .02 ---------- --------- -------- Diluted EPS: Income available to common shareholders $8,096,456 6,468,879 $ 1.25 ========== ========= ========

2002 ---- Per-Share Net Income Shares Amount ---------- ------ ------ Basic EPS: Income available to common shareholders $7,173,309 6,376,256 $ 1.12 Dilute effects of assumed exercises of stock options - 166,480 0.03 ---------- --------- -------- Diluted EPS: Income available to common shareholders $7,173,309 6,542,736 $ 1.09 ========== ========= ========

- -------------------------------------------------------------------------------- (Continued) 46 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 16 - EARNINGS PER SHARE (Continued)

2001 ---- Per-Share Net Income Shares Amount ---------- ------ ------ Basic EPS Income available to common shareholders $6,635,878 6,309,752 $ 1.05 Dilute effects of assumed exercises of stock options - 214,213 0.03 ---------- --------- -------- Diluted EPS Income available to common shareholders $6,635,878 6,523,965 $ 1.02 ========== ========= ========

No options were anti-dilutive for the years ended June 30, 2003, 2002, or 2001 as the market price in all cases was greater than the exercise price. NOTE 17 - FAIR VALUE OF FINANCIAL INSTRUMENTS The estimated fair value amounts have been determined by the Bank using available market information and appropriate valuation methodologies. However, considerable judgment is necessarily required to interpret market data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Bank could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts.

June 30, 2003 June 30, 2002 ------------- ------------- Carrying Estimated Carrying Estimated Amount Fair Value Amount Fair Value ------ ---------- -------- ---------- (in thousands) Assets: Cash and amounts due from depository institutions $ 9,755 9,755 4,527 4,527 Interest-bearing deposits 3,946 3,946 1,737 1,737 Federal funds sold 83,050 83,050 8,050 8,050 Securities held to maturity 33 33 55,121 55,752 Mortgage-backed securities held to maturity 2,965 3,032 7,297 7,501 Loans receivable held for: Investment, net 579,671 596,515 563,551 597,488 Sale, net 33,604 34,380 11,680 11,940 Federal Home Loan Bank stock 10,396 10,396 9,948 9,948

- -------------------------------------------------------------------------------- (Continued) 47 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 17 - FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)

June 30, 2003 June 30, 2002 ------------- ------------- Carrying Estimated Carrying Estimated Amount Fair Value Amount Fair Value --------- ---------- --------- ---------- (in thousands) Liabilities: Demand deposits and passbook savings $(124,263) (124,263) (108,072) (108,072) Time deposits (402,166) (410,934) (371,600) (376,534) Advances from the Federal Home Loan Bank of Cincinnati (120,123) (131,958) (120,740) (125,206) Notes payable (5,815) (5,815) (8,288) (8,288)

Cash and amounts due from depository institutions, interest bearing deposits, and federal funds sold. The carrying amount is a reasonable estimate of fair value because of the short maturity of these instruments. Securities and mortgage-backed securities. Estimated fair value for securities and mortgage-backed securities is based on quoted market prices. Loans receivable held for investment and held for sale. For loans receivable held for sale, fair value is estimated using the quoted market prices for securities backed by similar loans, adjusted for differences in loan characteristics. For performing loans receivable held for investment, fair value is estimated by discounting contractual cash flows adjusted for prepayment estimates using discount rates based on secondary market sources adjusted to reflect differences in servicing and credit costs. For other loans, cash flows and maturities are estimated based on contractual interest rates and historical experience and are discounted using secondary market rates adjusted for differences in servicing and credit costs. Fair value for significant nonperforming loans is based on recent external appraisals. If appraisals are not available, estimated cash flows are discounted using a rate commensurate with the risk associated with the estimated cash flows. Assumptions regarding credit risk, cash flows, and discount rates are judgmentally determined using available market information and specific borrower information. Federal Home Loan Bank stock. This item is valued at cost, which represents redemption value and approximates fair value. - -------------------------------------------------------------------------------- (Continued) 48 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 17 - FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued) Demand deposits and time deposits. The fair value of demand deposits, savings accounts, and certain money market deposits is the amount payable on demand at the reporting date. The fair value of fixed-maturity certificates of deposit is estimated using discounted cash flows and rates currently offered for deposits of similar remaining maturities. Advances from the Federal Home Loan Bank of Cincinnati. The fair value of the Bank's FHLB debt is estimated based on the current rates offered to the Bank for debt of the same remaining maturities. Notes payable. The carrying value of the Company's variable rate note payable is a reasonable estimate of fair value based on the current incremental borrowing rate for similar types of borrowing arrangements. Off-balance sheet instruments. The fair value of commitments is estimated using the fees currently charged to enter similar agreements, taking into account the remaining terms of the agreements and the counterparties' credit standing. For fixed-rate loan commitments, fair value also considers the difference between current levels of interest rates and the committed rates. The fair value of undisbursed lines of credit is based on fees currently charged for similar agreements or on estimated cost to terminate them or otherwise settle the obligations with the counterparties at the reporting date. The carrying amount and fair value of off-balance sheet instruments is not significant as of June 30, 2003 and 2002. NOTE 18 - PARENT COMPANY The following are condensed statements of financial condition as of June 30, 2003 and 2002 and related condensed statements of operations and cash flows for the years ended June 30, 2003, 2002 and 2001 for PVF Capital Corp. CONDENSED STATEMENTS OF FINANCIAL CONDITION - -------------------------------------------

2003 2002 ---- ---- Cash and amounts due from depository institutions $ 19,459 $ 106,598 Prepaid expenses and other assets 1,422,778 1,701,403 Investment in subsidiaries 59,802,552 55,409,326 ----------- ----------- Total assets $61,244,789 $57,217,327 =========== =========== Accrued expenses and other liabilities $ 141,653 $ 18,749 Note payable 2,500,000 4,900,000 Stockholders' equity 58,603,136 52,298,578 ----------- ----------- Total liabilities and stockholders' equity $61,244,789 $57,217,327 =========== ===========

- -------------------------------------------------------------------------------- (Continued) 49 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 18 - PARENT COMPANY (Continued) CONDENSED STATEMENTS OF OPERATIONS - ---------------------------------- C 2003 2002 2001 ---- ---- ---- Income: Mortgage banking activities $ 88,602 $ 142,140 $ 213,171 Dividends from subsidiaries 3,950,000 1,545,000 350,000 Other, net - - - ---------- ---------- ---------- 4,038,602 1,687,140 563,171 ---------- ---------- ---------- Expenses: Interest expense 137,483 276,418 304,688 General and administrative 284,890 214,296 184,532 ---------- ---------- ---------- 422,373 490,714 489,220 ---------- ---------- ---------- (Loss) income before federal income taxes and equity in undistributed net income of subsidiaries 3,616,229 1,196,426 73,951 Federal income tax benefit 112,615 116,951 93,856 ---------- ---------- ---------- (Loss) income before equity in undistributed net income of subsidiaries 3,728,844 1,313,377 167,807 Equity in undistributed net income of subsidiaries 4,367,612 5,859,932 6,468,071 ---------- ---------- ---------- Net income $8,096,456 $7,173,309 $6,635,878 ========== ========== ========== CONDENSED STATEMENTS OF CASH FLOWS - ----------------------------------

2003 2002 2001 ---- ---- ---- Operating activities: Net income $8,096,456 $7,173,309 $6,635,878 Equity in undistributed net income of subsidiaries (4,367,612) (5,859,932) (6,468,071) Repayment of advance from subsidiary 440,000 1,615,873 10,175,000 Other, net (38,471) (33,581) (6,890,112) ---------- ---------- ---------- Net cash provided by (used in) operating activities 4,130,373 2,895,669 3,452,695 ---------- ---------- ---------- Investing activities: Investment in Parkview Federal Savings Bank - - (500,000) ---------- ---------- ---------- Net cash used in investing activities - - (500,000) ---------- ---------- ----------

- -------------------------------------------------------------------------------- (Continued) 50 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 18 - PARENT COMPANY (Continued) Financing activities: Repayment on note payable (2,400,000) (3,050,000) (1,400,000) Proceeds from note payable - 3,250,000 - Proceeds from exercise of stock options 162,307 142,377 38,405 Cash paid in lieu of fractional shares - - - Dividends paid (1,654,844) (1,536,424) (1,378,774) Purchase of Treasury stock (324,975) (1,639,602) (189,437) ----------- ----------- ----------- Net cash provided by (used in) financing activities (4,217,512) (2,833,649) (2,929,806) ----------- ----------- ----------- Net increase (decrease) in cash and cash equivalents (87,139) 62,020 22,889 Cash and cash equivalents at beginning of year 106,598 44,578 21,689 ----------- ----------- ----------- Cash and cash equivalents at end of year $ 19,459 $ 106,598 $ 44,578 =========== =========== =========== NOTE 19 -EMPLOYEE BENEFIT PLANS 401(k) Savings Plan: Employees who have reached age 18 and have completed one year of eligibility service are eligible to participate in the Company's 401(k) Savings Plan. The plan allows eligible employees to contribute up to 15% of their compensation with the Company matching up to 50% of the first 4% contributed by the employee, as determined by the Company for the contribution period. The plan also permits the Company to make a profit sharing contribution at its discretion up to 4% of the employee's compensation. Participants vest in the Company's contributions ratably over six years. The total of the Company's matching and profit sharing contribution cost related to the plan for the years ended June 30, 2003, 2002, and 2001 was $104,094, $89,966, and $83,255, respectively. Supplemental Executive Retirement Plan: During fiscal year 2000, the Company established a Supplemental Executive Retirement Plan (SERP) to provide additional retirement benefits to participating executive officers. The SERP was adopted in order to provide benefits to such executives whose benefits are reduced under the Company's tax-qualified benefit plans pursuant to limitations under the Internal Revenue Code. The SERP is subject to certain vesting provisions, and provides that the executives shall receive a supplemental retirement benefit if the executive's employment is terminated after reaching the normal retirement. For the year ended June 30, 2003, 2002, and 2001, the Company recognized expense under the SERP of $401,400, $223,800, and $201,000, respectively. - -------------------------------------------------------------------------------- (Continued) 51 PVF CAPITAL CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended June 30, 2003, 2002 and 2001 - -------------------------------------------------------------------------------- NOTE 20 - SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) The following is a summary of the unaudited consolidated quarterly results of operations for 2003 and 2002 (in thousands of dollars, except per share data):(1)

Quarters For the Year Ended June 30, 2003 ---------------------------------------------- First Second Third Fourth ----- ------ ----- ------ Interest income $11,404 11,299 10,415 10,364 Interest expense 5,825 5,317 4,740 4,764 ------- ------ ------ ----- Net interest income 5,579 5,982 5,675 5,600 Provision for losses on loans 0 0 0 0 Noninterest income 750 1,838 1,597 1,708 Noninterest expense 3,801 4,412 4,114 4,181 ------- ------ ------ ----- Income before taxes 2,528 3,408 3,158 3,127 Federal income taxes 840 1,151 1,064 1,069 ------- ------ ------ ----- Net income $ 1,688 2,257 2,094 2,058 ======= ====== ====== ===== Basic earnings per share(2) $ 0.26 0.35 0.33 0.33 ======= ====== ====== ===== Diluted earnings per share(2) $ 0.25 0.35 0.32 0.32 ======= ====== ====== =====

Quarters For the Year Ended June 30, 2002 ---------------------------------------------- First Second Third Fourth ------- ------ ----- ------ Interest income $12,889 12,715 11,611 11,599 Interest expense 7,884 7,005 6,231 5,940 ------- ----- ----- ----- Net interest income 5,005 5,710 5,380 5,659 Provision for losses on loans 125 228 50 155 Noninterest income 781 1,070 870 1,030 Noninterest expense 3,159 3,732 3,548 3,700 ------- ----- ----- ----- Income before taxes 2,502 2,820 2,652 2,834 Federal income taxes 832 977 889 938 ------- ----- ----- ----- Net income $ 1,671 1,843 1,763 1,896 ======= ===== ===== ===== Basic earnings per share(2) $ 0.26 0.29 0.27 0.30 ======= ===== ===== ===== Diluted earnings per share(2) $ 0.25 0.28 0.26 0.29 ======= ===== ===== =====

(1) The total of the four quarterly amounts may not equal the full year amount due to rounding. (2) After giving effect to a 10% stock dividend, declared on July 25, 2002 and issued on August 30, 2002 and a 10% stock dividend, declared on June 24, 2003 and issued on August 29, 2003. - -------------------------------------------------------------------------------- 52 [PVF CAPITAL CORP. LOGO] - --------------------------------------------------------------------------------

Board of Directors General Information Board of Directors General Information - ---------------------- ------------------------ JOHN R. MALE INDEPENDENT Chairman of the Board and CERTIFIED ACCOUNTANTS Chief Executive Officer Crowe, Chizek and Company LLP Landerbrook Corporate Center One C. KEITH SWANEY 5900 Landerbrook Drive President, Chief Operating Officer Suite 205 and Treasurer Cleveland, Ohio 44124 GERALD A. FALLON GENERAL COUNSEL Retired Moriarty & Jaros, P.L.L. 30195 Chagrin Boulevard ROBERT K. HEALEY Suite 110 North Retired Pepper Pike, Ohio 44124 RONALD D. HOLMAN, II TRANSFER AGENT AND REGISTRAR Partner National City Bank, Dept. 5352 Cavitch, Familo, Durkin & Frutkin Corporate Trust Operations P.O. Box 92301 STANLEY T. JAROS Cleveland, Ohio 44193-0900 Partner Moriarty & Jaros, P.L.L. SPECIAL COUNSEL Stradley Ronon Stevens & Young, LLP RAYMOND J. NEGRELLI 1220 19th Street, N.W., Suite 600 President Washington, D.C. 20036 Raymond J. Negrelli, Inc. STOCK LISTING STUART D. NEIDUS NASDAQ Small-Cap Market Chairman and Symbol: PVFC Chief Executive Officer Anthony & Sylvan Pools Corporation ANNUAL MEETING The 2003 Annual Meeting of Stockholders will be held on October 20, 2003 at 10:00 a.m. at the Company's Corporate Center, Executive Officers 30000 Aurora Road, Solon, Ohio. Executive Officers - -------------------------- ANNUAL REPORT ON FORM 10-K A copy of the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2003 as filed with the Securities JOHN R. MALE and Exchange Commission will be furnished Chairman of the Board and without charge to stockholders upon written Chief Executive Officer request to the Corporate Secretary, PVF Capital Corp., 30000 Aurora C. KEITH SWANEY Road, Solon, Ohio 44139. President, Chief Operating Officer and Treasurer JEFFREY N. MALE Vice President and Secretary

[PVF CAPITAL CORP. LOGO] CORPORATE CENTER 30000 Aurora Road Solon, OH 44139 440-248-7171 www.parkviewfederal.com EX-21 6 l02888aexv21.txt EX-21 SUBSIDARIES OF THE REGISTRANT Exhibit 21 SUBSIDIARIES OF THE REGISTRANT Parent PVF Capital Corp. STATE OR OTHER JURISDICTION OF PERCENTAGE SUBSIDIARIES (1) INCORPORATION OWNERSHIP - ---------------- ------------- --------- Park View Federal Savings Bank U.S. 100% PVF Service Corporation Ohio 100% PVF Mortgage Corp. Ohio 100% PVF Community Development Corp. Ohio 100% Mid Pines Land Co. Ohio 100% PVF Holdings Inc. Ohio 100% - ------------ (1) The assets, liabilities and operations of the subsidiaries are included in the consolidated financial statements contained in the Annual Report to Stockholders attached hereto as Exhibit 13. EX-23.1 7 l02888aexv23w1.txt EX-23.1 CONSENT OF INDEPENDENT AUDITORS Exhibit 23.1 CONSENT OF INDEPENDENT ACCOUNTANTS The Board of Directors PVF Capital Corp.: We consent to the incorporation by reference in the Registration Statements No. 33-97450, No. 33-86116, No. 333-48446, and 333-14601 on Form S-8 of PVF Capital Corp. of our report dated July 27, 2001, relating to the consolidated statements of operations, stockholders' equity, and cash flows of PVF Capital Corp. and subsidiaries for the year ended June 30, 2001, which report appears in the June 30, 2003 Annual Report on Form 10-K of PVF Capital Corp. /s/ KPMG LLP Cleveland, Ohio September 25, 2003 EX-23.2 8 l02888aexv23w2.txt EX-23.2 CONSENT OF INDEPENDENT AUDITORS Exhibit 23.2 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to incorporation by reference in the registration statements (No. 33-97450, No. 33-86116, 333-14601 and No. 333-48446) on Form S-8 of PVF Capital Corp. of our report dated August 1, 2003, relating to the consolidated statement of financial condition of PVF Capital Corp. and subsidiaries as of June 30, 2003 and 2002, and the related consolidated statements of operations, stockholders' equity, and cash flows for the years ended June 30, 2003 and 2002, which report appears in the June 30, 2003 Annual Report on Form 10-K of PVF Capital Corp. /s/ Crowe, Chizek and Company, LLC Crowe, Chizek and Company, LLC Cleveland, Ohio September 29, 2003 EX-31.1 9 l02888aexv31w1.txt EX-31.1 CERTIFICATION Exhibit 31.1 CERTIFICATION I, John R. Male, Chairman of the Board and Chief Executive Officer of PVF Capital Corp., certify that: 1. I have reviewed this annual report on Form 10-K of PVF Capital Corp.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (c) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions); (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: September 23, 2003 /s/ John R. Male --------------------------------------- John R. Male Chairman of the Board and Chief Executive Officer (Principal Executive Officer) EX-31.2 10 l02888aexv31w2.txt EX-31.2 CERTIFICATION Exhibit 31.2 CERTIFICATION I, C. Keith Swaney, President and Chief Operating Officer of PVF Capital Corp., certify that: 1. I have reviewed this annual report on Form 10-K of PVF Capital Corp.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (c) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions); (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: September 23, 2003 /s/ C. Keith Swaney ---------------------------------------- C. Keith Swaney President and Chief Operating Officer (Principal Financial Officer) EX-32 11 l02888aexv32.txt EX-32 CERTIFICATION PURSUANT TO 18 USC SECT. 1350 Exhibit 32 CERTIFICATION PURSUANT TO 18. U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 The undersigned executive officers of the Registrant hereby certify that this Annual Report on Form 10-K for the year ended June 30, 2003 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant. By: /s/ John R. Male ------------------------------------- Name: John R. Male Title: Chairman of the Board and Chief Executive Officer By: /s/ C. Keith Swaney ------------------------------------- Name: C. Keith Swaney Title: President and Chief Financial Officer Date: September 23, 2003 -----END PRIVACY-ENHANCED MESSAGE-----

EX-3.3

                                                                     Exhibit 3.3


                                     BYLAWS

                                     OF THE

                              BOARD OF DIRECTORS OF

                                PVF CAPITAL CORP.


                                    ARTICLE I

                               BOARD OF DIRECTORS

         SECTION 1. General Powers. The business and affairs of PVF Capital
Corp. (herein the "Corporation") shall be under the direction of its board of
directors. The board of directors shall annually elect a chairman of the board
from among its members. The chairman of the board shall preside at all meetings
of the board of directors.

         SECTION 2. Number and Term. The board of directors shall consist of
eight members, and shall be divided into three classes as nearly equal in number
as possible. The members of each class shall be elected for a term of three
years and until their successors are elected and qualified. One class shall be
elected by ballot annually.

         SECTION 3. Regular Meetings. A regular meeting of the board of
directors shall be held without other notice than this Section immediately
after, and at the same place as, the annual meeting of stockholders. The board
of directors may provide, by resolution, the time and place for the holding of
additional regular meetings without other notice than such resolution.

         SECTION 4. Special Meetings. Special meetings of the board of directors
may be called by or at the request of the chairman of the board or the
president, or by one-third of the directors. The persons authorized to call
special meetings of the board of directors may fix any place as the place for
holding any special meeting of the board of directors called by such persons.

         Members of the board of directors may participate in special meetings
by means of conference telephone or similar communications equipment by which
all persons participating in the meeting can hear each other. Such participation
shall constitute presence in person.

         SECTION 5. Notice. Written notice of any special meeting shall be given
to each director at least two days previous thereto delivered personally or by
telegram or at least five days previous thereto delivered by mail at the address
at which the director is most likely to be reached. Such notice shall be deemed
to be delivered when deposited in the United States mail so addressed, with
postage thereon prepaid if mailed or when delivered to the telegraph company if
sent by telegram. Any director may waive notice of any meeting by a writing
filed with the secretary. The attendance of a director at a meeting shall
constitute a waiver of notice of such meeting, unless, prior to or at the
commencement of such meeting, such director objects to the transaction of any
business because the meeting is not lawfully called or convened. Neither the
business to be transacted at, nor the purpose of, any meeting of the board of
directors need be specified in the notice or waiver of notice of such meeting.

         SECTION 6. Quorum. A majority of the number of directors fixed by
Section 2 of this Article I shall constitute a quorum for the transaction of
business at any meeting of the board of directors, but if less than such
majority is present at a meeting, a majority of the directors present may
adjourn the meeting from time to time. Notice of any adjourned meeting shall be
given in the same manner as prescribed by Section 5 of this Article I.

         SECTION 7. Manner of Acting. The act of the majority of the directors
present at a meeting at which a quorum is present shall be the act of the board
of directors, unless a greater number is prescribed by these Bylaws, the
Articles of Incorporation, or the laws of Ohio.






         SECTION 8. Action Without a Meeting. Any action required or permitted
to be taken by the board of directors at a meeting may be taken without a
meeting if a consent in writing, setting forth the action so taken, shall be
signed by all of the directors.

         SECTION 9. Resignation. Any director may resign at any time by sending
a written notice of such resignation to the home office of the Corporation
addressed to the chairman of the board or the president. Unless otherwise
specified therein such resignation shall take effect upon receipt thereof by the
chairman of the board or the president.

         SECTION 10. Vacancies. Vacancies occuring in the board of directors
shall be filled in accordance with the provisions of the Corporation's Articles
of Incorporation. A director elected to fill a vacancy shall be elected to serve
until the annual meeting of stockholders at which the term of the class to which
the director has been chosen expires.

         SECTION 11. Presumption of Assent. Unless Ohio law provides otherwise,
a director of the Corporation who is present at a meeting of the board of
directors at which action on any Corporation matter is taken shall be presumed
to have assented to the action taken unless (i) he objects at the beginning of
the meeting (or promptly upon his arrival) to holding the meeting or transacting
business at the meeting; (ii) his dissent or abstention from the action taken is
entered in the minutes of the meeting; or (iii) he delivers written notice of
his dissent or abstention to the presiding officer of the meeting before its
adjournment or to the Corporation immediately after adjournment of the meeting.
The right of dissent or abstention is not available to a director who votes in
favor of the action taken.

         SECTION 12. Compensation. The board of directors may, by resolution,
from time to time establish the compensation to be paid to directors for their
service as such. Members of either standing or special committees may be allowed
such compensation for actual attendance at committee meetings as the board of
directors may determine.

                                   ARTICLE II

                      COMMITTEES OF THE BOARD OF DIRECTORS

         The board of directors may, by resolution passed by a majority of the
whole board, designate one or more committees, as they may determine to be
necessary or appropriate for the conduct of the business of the Corporation, and
may prescribe the duties, constitution and procedures thereof. Each committee
shall consist of not less than three directors of the Corporation. The board may
designate not less than three directors as alternate members of any committee,
who may replace any absent or disqualified member at any meeting of the
committee.

         The board of directors shall have power, by the affirmative vote of a
majority of the number of directors fixed by Article I, Section 2, at any time
to change the members of, to fill vacancies in, and to discharge any committee
of the board. Any member of any such committee may resign at any time by giving
notice to the Corporation; provided, however, that notice to the board, the
chairman of the board, the chief executive officer, the chairman of such
committee, or the secretary shall be deemed to constitute notice to the
Corporation. Such resignation shall take effect upon receipt of such notice or
at any later time specified therein; and, unless otherwise specified therein,
acceptance of such resignation shall not be necessary to make it effective. Any
member of any such committee may be removed at any time, either with or without
cause, by the affirmative vote of a majority of the authorized number of
directors at any meeting of the board called for that purpose.


                                   ARTICLE III

                                    AMENDMENT

         These Bylaws may be amended in whole or in part at any time by the
Board of Directors by the affirmative vote of a majority of the authorized
number of directors.

EX-10.5

                                                                    Exhibit 10.5

                                PVF CAPITAL CORP.
                           2000 INCENTIVE STOCK OPTION
                                       AND
                           DEFERRED COMPENSATION PLAN

                                    ARTICLE 1
                                     PURPOSE

     1.1 GENERAL. The purpose of the PVF Capital Corp. 2000 Incentive Stock
Option and Deferred Compensation Plan (the "Plan") is to promote the success and
enhance the value of PVF Capital Corp. (the "Company") by linking the personal
interests of the members of the Board and the Company's employees, officers and
executives to those of Company shareholders and by providing such individuals
with an incentive for outstanding performance in order to generate superior
returns to shareholders of the Company. The Plan is further intended to provide
flexibility to the Company in its ability to motivate, attract, and retain the
services of members of the Board, employees, officers, and executives of the
Company upon whose judgment, interest, and special effort the successful conduct
of the Company's operation is largely dependent. For purposes of this Plan,
"Company" shall be deemed to include subsidiaries of PVF Capital Corp., unless
the context requires otherwise.

                                    ARTICLE 2
                             EFFECTIVE DATE AND TERM

     2.1 EFFECTIVE DATE. The Plan was originally effective as of September 26,
2000 (the "Effective Date"). The Plan, as hereby amended and restated, will be
effective as of the date it is approved by the shareholders of the Company. No
Awards which could not have been granted under the prior version of the Plan
shall be made prior to shareholder approval of this amended and restated version
of the Plan.

     2.2 TERM. Unless sooner terminated by the Board, the Plan shall terminate
on the tenth (10th) anniversary of the Effective Date, and no Awards may be
granted under the Plan thereafter. The termination of the Plan shall not affect
any Award that is outstanding on the termination date, without the consent of
the Participant.

                                   ARTICLE 3
                          DEFINITIONS AND CONSTRUCTION

     3.1 DEFINITIONS. When a word or phrase appears in this Plan with the
initial letter capitalized, and the word or phrase does not commence a sentence,
the word or phrase shall generally be given the meaning ascribed to it in this
Section or in Sections 1.1 or 2.1 unless a clearly different meaning is required
by the context. The following words and phrases shall have the following
meanings:

          (a) "Award" means any Option, Stock Appreciation Right, Restricted
Stock Award, Unrestricted Stock Award, or Performance-Based Award granted to a
Participant under the Plan.

          (b) "Award Agreement" means a writing, in such form as the Committee
in its discretion shall prescribe, evidencing an Award.

          (c) "Bank" means Park View Federal Savings Bank.

          (d) "Board" means the Board of Directors of the Company.

          (e) "Cause" means, in the good faith determination of the Board, the
Participant's personal dishonesty, incompetence, willful misconduct, breach of
fiduciary duty involving personal profit, intentional failure to perform stated
duties, or willful violation of any law, rule or regulation (other than traffic
violations or similar offenses) or final cease-and-desist order. No act, or
failure to act, on the Participant's part shall be considered "willful" unless
he has acted, or failed to act, with an absence of good faith and without a
reasonable belief that his action or failure to act was in the best interest of
the Company.





          (f) "Change in Control" means:

               (1) the acquisition by a person or persons acting in concert of
the power to vote twenty-five percent (25%) or more of a class of the Company's
voting securities;

               (2) the acquisition by a person of the power to direct the Bank's
or Company's management or policies, if the Board of Directors or the OTS has
made a determination that such acquisition constitutes or will constitute an
acquisition of control of the Bank or the Company for the purposes of the
Savings & Loan Holding Company Act or the Change in Bank Control Act and the
regulations thereunder;

               (3) during any period of two (2) consecutive years, individuals
who at the beginning of such period constitute the members of the Board cease,
for any reason, to constitute at least a majority thereof, unless the election
of each director who was not a director at the beginning of such period has been
approved in advance by directors representing at least two-thirds (2/3) of the
directors then in office who were directors in office at the beginning of the
period; provided, however, that for purposes of this clause (3), each director
who is first elected to the Board (or first nominated by the Board for election
by the shareholders) with the approval of at least two-thirds (2/3) of the
directors who were directors at the beginning of the period shall be deemed to
be a director at the beginning of the two-year period;

               (4) the Company shall have merged into or consolidated with
another corporation, or merged another corporation into the Company, on a basis
whereby less than fifty percent (50%) of the total voting power of the surviving
corporation is represented by shares held by persons who were shareholders of
the Company immediately before the merger or consolidation; or

               (5) the Company shall have sold to another person (i)
substantially all of the Company's assets or (ii) the Bank.

The term "person" refers to an individual, corporation, partnership, trust,
association, joint venture, pool, syndicate, sole proprietorship, unincorporated
organization or other entity.

          (g) "Code" means the Internal Revenue Code of 1986, as amended, and
regulations promulgated thereunder.

          (h) "Committee" means the committee of the Board described in Article
4.

          (i) "Covered Employee" means an Employee who is a "covered employee"
within the meaning of Section 162(m) of the Code.

          (j) "Deferred Compensation Account" means the bookkeeping account
established for each Participant pursuant to Section 12.2 of this Plan.

          (k) "Disability" shall have the meaning set forth in Section 22(e)(3)
of the Code.

          (l) "Distribution Event" means an event as a result of which a
Participant is entitled to receive the balance of his or her Deferred
Compensation Account pursuant to Section 12.3 of this Plan, namely (i) with
respect to a Participant who is an employee of the Company and the portion of
his or her Deferred Compensation Account attributable to an Award or other
compensation earned as an employee, the date the Participant terminates his or
her employment with the Company, and (ii) with respect a Participant who is a
member of the Board and the portion of his or her Deferred Compensation Account
attributable to an Award or other compensation earned as a member of the Board,
the earlier of (A) the date the Participant terminates his or her service as a
member of the Board, or (B) the Participant's attainment of the age specified
(not younger than age 55) in an election form filed by the Participant with the
Committee at such time as he or she first becomes eligible to defer compensation
pursuant to Article 12 of this Plan.





                                       2



          (m) "Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the regulations promulgated thereunder.

          (n) "Fair Market Value" means, as of any given date, the fair market
value of Stock on a particular date determined in accordance with the
requirements of Section 422 of the Code.

          (o) "Incentive Stock Option" means an Option that is intended to meet
the requirements of Section 422 of the Code or any successor provision thereto.

          (p) "Non-Employee Director" means a member of the Board who qualifies
as a "Non-Employee Director" as defined in Rule 16b-3(b)(3) under the Exchange
Act, or any successor definition adopted by the Board.

          (q) "Non-Qualified Stock Option" means an Option that is not intended
to be an Incentive Stock Option.

          (r) "Option" means a right granted to a Participant under Article 7 of
the Plan to purchase Stock at a specified price during specified time periods.
An Option may be either an Incentive Stock Option or a Non-Qualified Stock
Option.

          (s) "Participant" means a person who, as a member of the Board, an
employee, officer, or executive of the Company, has been granted an Award under
the Plan, or who has been designated as eligible to make an election to defer
compensation under this Plan.

          (t) "Performance-Based Awards" means Stock Awards granted to selected
Covered Employees pursuant to Article 9, but which are subject to the terms and
conditions set forth in Article 10. All Performance-Based Awards are intended to
qualify as "performance-based compensation" under Section 162(m) of the Code.

          (u) "Performance Criteria" means the criteria that the Committee
selects for purposes of establishing the Performance Goal or Performance Goals
for a Participant for a Performance Period. The Performance Criteria that will
be used to establish Performance Goals may include, but shall not be limited to,
one or more of the following: pre- or after-tax net earnings, sales growth,
operating earnings, operating cash flow, working capital, return on net assets,
return on stockholders' equity, return on assets, return on capital, Stock price
growth, stockholder returns, gross or net profit margin, earnings per share,
price per share of Stock, and market share, any of which may be measured either
in absolute terms or as compared to any incremental increase or as compared to
results of a peer group. The Committee shall, within the time prescribed by
Section 162(m) of the Code, define in an objective fashion the manner of
calculating the Performance Criteria it selects to use for such Performance
Period for such Participant.

          (v) "Performance Goals" means, for a Performance Period, the goals
established in writing by the Committee for the Performance Period based upon
the Performance Criteria. Depending on the Performance Criteria used to
establish such Performance Goals, the Performance Goals may be expressed in
terms of overall Company performance or the performance of a division, business
unit, or an individual. The Committee, in its discretion, may, within the time
prescribed by Section 162(m) of the Code, adjust or modify the calculation of
Performance Goals for such Performance Period in order to prevent the dilution
or enlargement of the rights of Participants (i) in the event of, or in
anticipation of, any unusual or extraordinary corporate item, transaction,
event, or development, or (ii) in recognition of, or in anticipation of, any
other unusual or nonrecurring events affecting the Company, or the financial
statements of the Company, or in response to, or in anticipation of, changes in
applicable laws, regulations, accounting principles, or business conditions.

          (w) "Performance Period" means the one or more periods of time, which
may be of varying and overlapping durations, as the Committee may select, over
which the attainment of one or more Performance Goals will be measured for the
purpose of determining a Participant's right to, and the payment of, a
Performance-Based Award.





                                       3



          (x) "Plan" means the PVF Capital Corp. 2000 Incentive Stock Option and
Deferred Compensation Plan (formerly known as the "PVF Capital Corp. 2000
Incentive Stock Option Plan"), as set forth herein.

          (y) "Restricted Stock Award" means Stock granted to a Participant
under Article 9 that is subject to certain restrictions and to risk of
forfeiture.

          (z) "Stock" means the common stock of the Company and such other
securities of the Company that may be substituted for Stock pursuant to Article
13.

          (aa) "Stock Appreciation Right" or "SAR" means a right granted to a
Participant under Article 8 to receive a payment equal to the difference between
the Fair Market Value of a share of Stock as of the date of exercise of the SAR
over the grant price of the SAR, all as determined pursuant to Article 8.

          (bb) "Stock Award" means a Restricted Stock Award or an Unrestricted
Stock Award.

          (cc) "Unrestricted Stock Award" means Stock granted to a Participant
under Article 9 that is not subject to restrictions or a risk of forfeiture.

                                    ARTICLE 4
                                 ADMINISTRATION

     4.1 COMMITTEE. The Plan shall be administered by a Committee appointed by,
and which serves at the discretion of, the Board. The Committee shall consist of
at least two individuals, each of whom qualifies as a Non-Employee Director. To
the extent necessary or desirable each member of the Committee shall also
qualify as an "outside director" under Code Section 162(m) and the regulations
issued thereunder. The members of the Committee shall meet such additional
criteria as may be necessary or desirable to comply with regulatory or stock
exchange rules or exemptions. The Company will pay all reasonable expenses of
the Committee.

     4.2 AUTHORITY OF COMMITTEE. Subject to any specific designation in the
Plan, the Committee has the exclusive power, authority and discretion to:

          (a) Designate Participants to receive Awards;

          (b) Determine the type or types of Awards to be granted to each
Participant;

          (c) Determine the number of Awards to be granted and the number of
shares of Stock to which an Award will relate;

          (d) Determine the terms and conditions of any Award granted under the
Plan including but not limited to, the exercise price, grant price, or purchase
price, any restrictions or limitations on the Award, any schedule for lapse of
forfeiture restrictions or restrictions on the exercisability of an Award, and
accelerations or waivers thereof, based in each case on such considerations as
the Committee in its sole discretion determines;

          (e) Amend, modify, or terminate any outstanding Award, with the
Participant's consent unless the Committee has the authority to amend, modify,
or terminate an Award without the Participant's consent under any other
provision of the Plan.

          (f) Determine whether, to what extent, and under what circumstances an
Award may be settled in, or the exercise price of an Award may be paid in, cash,
Stock, other Awards, or other property, or an Award may be canceled, forfeited,
or surrendered;

          (g) Prescribe the form of each Award Agreement, which need not be
identical for each Participant;




                                       4



          (h) Decide all other matters that must be determined in connection
with an Award;

          (i) Establish, adopt, revise, amend or rescind any guidelines, rules
and regulations as it may deem necessary or advisable to administer the Plan;
and

          (j) Interpret the terms of, and rule on any matter arising under, the
Plan or any Award Agreement;

          (k) Make all other decisions and determinations that may be required
under the Plan or as the Committee deems necessary or advisable to administer
the Plan, including but not limited to, the determination of whether and to what
extent any Performance Goals have been achieved; and

          (l) Retain counsel, accountants and other consultants to aid in
exercising its powers and carrying out its duties under the Plan.

     4.3 DECISIONS BINDING. The Committee's interpretation of the Plan, any
Awards granted under the Plan, any Award Agreement and all decisions and
determinations by the Committee with respect to the Plan shall be final,
binding, and conclusive on all parties and any other persons claiming an
interest in any Award or under the Plan.

                                    ARTICLE 5
                           SHARES SUBJECT TO THE PLAN

     5.1 NUMBER OF SHARES. Subject to adjustment provided in Section 13.1, the
aggregate number of shares of Stock reserved and available for grant under the
Plan shall be two hundred and fifty thousand (250,000).

     5.2 LAPSED AWARDS. To the extent that an Award terminates, is cancelled,
expires, lapses or is forfeited for any reason, including, but not limited to,
the failure to achieve any Performance Goals, any shares of Stock subject to the
Award will again be available for the grant of an Award under the Plan.

     5.3 STOCK DISTRIBUTED. Any Stock distributed pursuant to an Award may
consist, in whole or in part, of authorized and unissued Stock, treasury Stock
or Stock purchased on the open market.

     5.4 LIMITATION ON NUMBER OF SHARES SUBJECT TO AWARDS. Notwithstanding any
provision in the Plan to the contrary, and subject to the adjustment in Section
13.1, the maximum number of shares of Stock with respect to Options and Stock
Appreciation Rights that may be granted to any one Participant during the
Company's fiscal year shall be twenty-five thousand (25,000).

                                    ARTICLE 6
                          ELIGIBILITY AND PARTICIPATION

     6.1 ELIGIBILITY. Persons eligible to participate in this Plan include all
members of the Board and any key executive of the Company (which term shall be
deemed to include among others, the president, any vice president, secretary,
treasurer or any manager in charge of a principal business unit, division or
function (such as sales, administration or finance), any other officer who
performs a policy making function, or any other person who performs similar
policy making functions for the Company or any of its subsidiaries) and who on
the date of any Award is in the employ of the Company or one of its then
subsidiary corporations, as defined in Section 424 of the Code.

     6.2 ACTUAL PARTICIPATION. Subject to the provisions of the Plan, the
Committee may, from time to time, select from among all eligible individuals,
those to whom Awards shall be granted and shall determine the nature and amount
of each Award. No individual shall have any right to be granted an Award under
this Plan.



                                       5



                                    ARTICLE 7
                                  STOCK OPTIONS

     7.1 GENERAL. The Committee is authorized to grant Options to Participants
on the following terms and conditions:

          (a) EXERCISE PRICE. The exercise price per share of Stock under an
Option shall be the Fair Market Value as of the date of grant.

          (b) TIME AND CONDITIONS OF EXERCISE. Except as provided herein, the
Committee shall determine the time or times at which an Option may be exercised
in whole or in part. The Committee shall also determine the performance or other
conditions, if any, that must be satisfied before all or part of an Option may
be exercised; provided, however, in no event shall an Option granted to a
Participant who is not a member of the Board be exercisable before the
Participant has completed one year of continued employment or service with the
Company. An Option will lapse immediately if a Participant's employment or
services are terminated for Cause.

               (1) The Option of any Participant whose employment is terminated
for any reason, other than for death, Disability or Cause shall be exercisable
to the extent provided therein, through the earlier of the date which is three
months after termination of employment or the date that such Option expires in
accordance with its terms, and shall expire thereafter.

               (2) In the event of the death of a Participant while an employee
of the Company or within three months after the termination of employment of the
Participant for other than Cause, or in the event of the termination of
employment by a Participant for Disability, the Option may be exercised as
follows:

                    (A) In the event of the death of a Participant during
employment or the death of the Participant within three months after the
termination of employment for other than Cause, each Option granted to such
Participant shall be exercisable to the extent provided therein but not later
than one year after his or her death (but not beyond the stated duration of the
Option). Any such exercise shall be made only by or to the executor or
administrator of the estate of the deceased Participant or person or persons to
whom the deceased Participant's rights under the Option shall pass by will or
the laws of descent and distribution and to the extent, if any, that the
deceased Participant was entitled at the date of his or her death.

                    (B) In the case of a Participant whose employment is
terminated on account of Disability, the Option shall be exercisable or payable
to the extent provided therein on the earlier of one year after termination of
employment or the date that such Option expires in accordance with its terms.
During such period, the Option may be exercised by the Participant with respect
to the same number of shares, in the same manner and to the same extent as if
the Participant had continued employment during such period.

               (3) Each Option granted under the Plan shall, by its terms, not
be transferable otherwise than by will or the laws of descent and distribution.
Notwithstanding the foregoing, or any other provision of this Plan, a
Participant who holds Options may transfer such Options (but not Incentive Stock
Options) to his or her spouse, lineal ascendants, lineal descendants, or to a
duly established trust for the benefit of one or more of these individuals.
Options so transferred may thereafter be transferred only to the Participant who
originally received the grant or to an individual or trust to whom the
Participant could have initially transferred the Options pursuant to this
Section 7.1(b)(3). Options which are transferred pursuant to this Section
7.1(b)(3) shall be exercisable by the transferee according to the same terms and
conditions as applied to the Participant.

               (4) For the purposes of this Section, Options granted to
directors may be exercised at any time prior to the expiration date of the
Option. In the event of the death of the director, Options may be exercised at
any time prior to the expiration date of the option. Any such exercise or
payment shall be made only by or to the executor or administrator of the estate
of the deceased Director or person or persons to whom the deceased Director's
rights under the Option shall pass by will or the laws of descent and
distribution and to the extent, if any, that the deceased Director was entitled
at the date of his or her death.




                                       6



          (c) PAYMENT. An Option shall be exercised by giving a written notice
to the President of the Company stating the number of shares of Stock with
respect to which the Option is being exercised and containing such other
information as the President may request and by tendering payment therefore with
a cashier's check, certified check, or with existing holdings of Common Stock
held for more than six months.

          (d) EVIDENCE OF GRANT. All Options shall be evidenced by an Award
Agreement. The Award Agreement shall include such additional provisions as may
be specified by the Committee.

     7.2 INCENTIVE STOCK OPTIONS. Incentive Stock Options shall be granted only
to employees and the terms of any Incentive Stock Options granted under the Plan
must comply with the following additional rules:

          (a) EXERCISE PRICE. The exercise price per share of Stock shall be set
by the Committee, provided that the exercise price for any Incentive Stock
Option may not be less than the Fair Market Value as of the date of the grant.

          (b) EXERCISE. In no event, may any Incentive Stock Option be
exercisable for more than ten years from the date of its grant.

          (c) LAPSE OF OPTION. An Incentive Stock Option shall lapse under the
following circumstances.

                    (1) The Incentive Stock Option shall lapse ten years from
the date it is granted, unless an earlier time is set in the Award Agreement.

                    (2) The Incentive Stock Option shall lapse upon termination
of employment for Cause or for any other reason, other than the Participant's
death or Disability, unless otherwise provided in the Award Agreement.

                    (3) If the Participant terminates employment on account of
Disability or death before the Option lapses pursuant to paragraph (1) or (2)
above, the Incentive Stock Option shall lapse, unless it was previously
exercised, on the earlier of (i) the date on which the Option would have lapsed
had the Participant not become Disabled or lived and had his employment status
(i.e., whether the Participant was employed by the Company on the date of his
Disability or death or had previously terminated employment) remained unchanged;
or (ii) 12 months after the date of the Participant's termination of employment
on account of Disability or death.

          (d) INDIVIDUAL DOLLAR LIMITATION. The aggregate Fair Market Value
(determined as of the time an Award is made) of all shares of Stock with respect
to which Incentive Stock Options are first exercisable by a Participant in any
calendar year may not exceed $100,000.00 or such other limitation as imposed by
Section 422(d) of the Code, or any successor provision. To the extent that
Incentive Stock Options are first exercisable by a Participant in excess of such
limitation, the excess shall be considered Non-Qualified Stock Options.

          (e) TEN PERCENT OWNERS. An Incentive Stock Option shall be granted to
any individual who, at the date of grant, owns stock possessing more than ten
percent of the total combined voting power of all classes of Stock of the
Company only if such Option is granted at a price that is not less than 110% of
Fair Market Value on the date of grant and the Option is exercisable for no more
than five years from the date of grant.

          (f) RIGHT TO EXERCISE. During a Participant's lifetime, an Incentive
Stock Option may be exercised only by the Participant.





                                       7



                                    ARTICLE 8
                            STOCK APPRECIATION RIGHTS

     8.1 GRANT OF SARS. The Committee is authorized to grant SARs to
Participants on the following terms and conditions:

          (a) RIGHT TO PAYMENT. Upon the exercise of a Stock Appreciation Right,
the Participant to whom it is granted has the right to receive the excess, if
any, of:

               (1) The Fair Market Value of a share of Stock on the date of
exercise; over

               (2) The grant price of the Stock Appreciation Right as determined
by the Committee, which shall not be less than the Fair Market Value of a share
of Stock on the date of grant in the case of any SAR related to any Incentive
Stock Option.

          (b) OTHER TERMS. All such Awards shall be evidenced by an Award
Agreement. The terms, methods of exercise, methods of settlement, form of
consideration payable in settlement, and any other terms and conditions of any
Stock Appreciation Right shall be determined by the Committee at the time of the
grant of the Award and shall be reflected in the Award Agreement.

                                    ARTICLE 9
                                  STOCK AWARDS

     9.1 GRANT OF STOCK. The Committee is authorized to grant Unrestricted Stock
Awards and Restricted Stock Awards to Participants in such amounts and subject
to such terms and conditions as determined by the Committee. All such Awards
shall be evidenced by an Award Agreement.

     9.2 ISSUANCE AND RESTRICTIONS. An Unrestricted Stock Award may provide for
a transfer of shares of Stock to a Participant at the time the Award is granted,
or it may provide for a deferred transfer of shares of Stock subject to
conditions prescribed by the Committee. Restricted Stock Awards shall be subject
to such restrictions on transferability and risks of forfeiture as the Committee
may impose. These restrictions and risks may lapse separately or in combination
at such times, under such circumstances, in such installments, or otherwise, as
the Committee determines at the time of the grant of the Award or thereafter.

     9.3 FORFEITURE. Except as otherwise determined by the Committee at the time
of the grant of the Award or thereafter, upon termination of employment during
the applicable restriction period, Stock subject to a Restricted Stock Award
that is at that time subject to restrictions shall be forfeited, provided,
however, that the Committee may provide in any Restricted Stock Award that
restrictions or forfeiture conditions relating to the Stock will be waived in
whole or in part in the event of terminations resulting from specified causes,
and the Committee may in other cases waive in whole or in part restrictions or
forfeiture conditions relating to the Stock.

     9.4 CERTIFICATES FOR RESTRICTED STOCK. Restricted Stock Awards granted
under the Plan may be evidenced in such manner as the Committee shall determine.
If certificates representing shares of Stock subject to Restricted Stock Awards
are registered in the name of the Participant, certificates must bear an
appropriate legend referring to the terms, conditions, and restrictions
applicable to such shares, and the Company may, at its discretion, retain
physical possession of the certificate until such time as all applicable
restrictions lapse.

                                   ARTICLE 10
                            PERFORMANCE-BASED AWARDS

     10.1 PURPOSE. The purpose of this Article 10 is to provide the Committee
the ability to qualify the Awards under Article 9 as "performance-based
compensation" under Section 162(m) of the Code. If the Committee, in its
discretion, decides to grant a Performance-Based Award to a Covered Employee,
the provisions of this Article 10 shall control over any contrary provision
contained in Article 10.






                                       8




     10.2 APPLICABILITY. This Article 10 shall apply only to those Covered
Employees selected by the Committee to receive Performance-Based Awards. The
Committee may, in its discretion, grant Stock Awards to Covered Employees that
do not satisfy the requirements of this Article 10. The designation of a Covered
Employee as a Participant for a Performance Period shall not in any manner
entitle the Participant to receive an Award for the period. Moreover,
designation of a Covered Employee as a Participant for a particular Performance
Period shall not require designation of such Covered Employee as a Participant
in any subsequent Performance Period and designation of one Covered Employee as
a Participant shall not require designation of any other Covered Employees as a
Participant in such period or in any other period.

     10.3 DISCRETION OF COMMITTEE WITH RESPECT TO PERFORMANCE AWARDS. With
regard to a particular Performance Period, the Committee shall have full
discretion to select the length of such Performance Period, the type of
Performance-Based Awards to be issued, the kind and/or level of the Performance
Goal, and whether the Performance Goal is to apply to the Company or any
division or business unit thereof.

     10.4 PAYMENT OF PERFORMANCE-BASED AWARDS. Unless otherwise provided in the
relevant Award Agreement, a Participant must be employed by the Company on the
last day of the Performance Period to be eligible for a Performance-Based Award
for such Performance Period. In determining the actual size of an individual
Performance-Based Award, the Committee may reduce or eliminate the amount of the
Performance-Based Award earned for the Performance Period, if in its sole and
absolute discretion, such reduction or elimination is appropriate.

     10.5 SHAREHOLDER APPROVAL. The Board shall disclose to the shareholders of
the Company the material terms of any Performance - Based Award, and shall seek
approval of the shareholders of the Performance - Based Award before any Stock
is transferred to a Participant, or before any restrictions with respect to same
lapse, pursuant to such Award. The Committee shall certify that the Performance
Goals with respect to any Performance - Based Award have been achieved before
any Stock is transferred to a Participant, or before any restrictions with
respect to same lapse. Such disclosure, approval and certification shall be
effected in accordance with the requirements of Section 162(m)(4)(C) of the
Code.

                                   ARTICLE 11
                         PROVISIONS APPLICABLE TO AWARDS

     11.1 STAND-ALONE AND TANDEM AWARDS. Awards granted under the Plan may, in
the discretion of the Committee, be granted either alone, in addition to, or in
tandem with, any other Award granted under the Plan. Awards granted in addition
to or in tandem with other Awards may be granted either at the same time as or
at a different time from the grant of such other Awards.

     11.2 EXCHANGE PROVISIONS. The Committee may at any time offer to exchange
or buy out any previously granted Award for a payment in cash, Stock, or another
Award, based on the terms and conditions the Committee determines and
communicates to the Participant at the time the offer is made.

     11.3 TERM OF AWARD. The term of each Award shall be for the period as
determined by the Committee, provided that in no event shall the term of any
Incentive Stock Option or a Stock Appreciation Right granted in tandem with the
Incentive Stock Option exceed a period of ten years from the date of its grant.

     11.4 LIMITS ON TRANSFER. No right or interest of a Participant in any Award
may be pledged, encumbered, or hypothecated to or in favor of any party other
than the Company, or shall be subject to any lien, obligation, or liability of
such Participant to any other party other than the Company. No Award shall be
assignable or transferable by a Participant other than by will or the laws of
descent and distribution, except that the Committee, in its discretion, may
permit a Participant to make a gratuitous transfer of an Award that is not an
Incentive Stock Option to his or her spouse, lineal descendants, lineal
ascendants, or a duly established trust for the benefit of one or more of these
individuals.

     11.5 BENEFICIARIES. Notwithstanding Section 11.4, a Participant may, in the
manner determined by the Committee, designate a beneficiary to exercise the
rights of the Participant and to receive any distribution




                                       9



with respect to any Award upon the Participant's death. A beneficiary, legal
guardian, legal representative, or other person claiming any rights under the
Plan is subject to all terms and conditions of the Plan and any Award applicable
to the Participant, except to the extent the Plan and Award otherwise provide,
and to any additional restrictions deemed necessary or appropriate by the
Committee. If no beneficiary has been designated or survives the Participant,
payment shall be made to the Participant's estate. Subject to the foregoing, a
beneficiary designation may be changed or revoked by a Participant at any time
provided the change or revocation is filed with the Committee.

     11.6 STOCK CERTIFICATES. Notwithstanding anything herein to the contrary,
the Company shall not be required to issue or deliver any certificates
evidencing shares of Stock pursuant to the exercise of any Awards, unless and
until the Board has determined, with advice of counsel, that the issuance and
delivery of such certificates is in compliance with all applicable laws,
regulations of governmental authorities and, if applicable, the requirements of
any exchange on which the shares of Stock are listed or traded. All Stock
certificates delivered under the Plan are subject to any stop-transfer orders
and other restrictions as the Committee deems necessary or advisable to comply
with Federal, state, or foreign jurisdiction, securities or other laws, rules
and regulations and the rules of any national securities exchange or automated
quotation system on which the Stock is listed, quoted, or traded. The Committee
may place legends on any Stock certificate to reference restrictions applicable
to the Stock. In addition to the terms and conditions provided herein, the Board
may require that a Participant make such reasonable covenants, agreements, and
representations as the Board, in its discretion, deems advisable in order to
comply with any such laws, regulations, or requirements.

     11.7 LOAN AGREEMENTS. Each Award shall be subject to the condition that the
Company shall not be obligated to issue or transfer any Stock or cash to the
holder of the Award, upon the exercise or vesting thereof, if at any time the
Committee or the Board shall determine that the issuance or transfer of such
Stock or cash would be in violation of any covenant in any of the Company's loan
agreements or other contracts.

                                   ARTICLE 12
                            DEFERRAL OF COMPENSATION

     12.1 RIGHT TO DEFER COMPENSATION.

          (a) TYPES OF DEFERRALS. Any Participant designated by the Board or by
the Committee may elect to defer (i) all or any portion of the Participant's
salary, (ii) any percentage of a fiscal year bonus determined by the Board or
other duly constituted authority or delegate to be paid to such Participant, or
(iii) all or any portion of the Participant's director's fees. Such election
shall remain in force for all future years until modified or revoked. In
addition, the Committee, in its discretion, may permit a Participant to elect to
defer his or her receipt of the payment of cash or the delivery of shares of
Stock that would otherwise be due to such Participant pursuant to an Award. Any
election under this Section 12.1 shall be made by written notice delivered to
the Board or Committee, specifying the amount (or percentage) of salary and/or
bonus and/or directors' fees and/or the award to be deferred.

          (b) TIMING OF ELECTIONS. A Participant may, at any time within 30 days
of first becoming eligible to participate in this Plan, make an election to
defer salary or director's fees earned after such election. Any increase or
decrease in future deferrals of salary or director's fees earned during a
calendar year must be made by December 1 of the preceding calendar year. A
Participant may make an initial election to defer a bonus for a fiscal year, or
may elect to increase or decrease the amount of a fiscal year bonus to be
deferred, if such election is made by June 1 of the preceding fiscal year;
provided, however, that a Participant may make an election to defer up to fifty
percent (50%) of a bonus for the fiscal year ending June 30, 2004 if such
election is made by December 1, 2003. A Participant may make an election to
defer the receipt of cash or shares of Stock otherwise payable or transferable
to the Participant pursuant to an Award in accordance with the terms of such
Award.





                                       10





     12.2 DEFERRED COMPENSATION ACCOUNTS.

          (a) ESTABLISHMENT OF ACCOUNTS. A Deferred Compensation Account in the
name of each Participant who has elected to defer compensation under the Plan
shall be established and maintained as a special ledger account on the books of
the Company. On the last day of each calendar month in which salary or
director's fees deferred under this Plan would have become payable to a
Participant (in the absence of an election to defer payment thereof), the amount
of such deferred salary or director's fees shall be credited to the
Participant's Deferred Compensation Account. On the last day of the month in
which the bonuses deferred under this Plan would have become payable to a
Participant in the absence of an election to defer payment thereof, the amount
of such deferred bonus shall be credited to the Participant's Deferred
Compensation Account. On the last day of the month in which an Award would have
otherwise become payable or transferable to a Participant in the absence of an
election to defer receipt thereof, the amount of such deferred Award shall be
credited to the Participant's Deferred Compensation Account.

          (b) DEEMED INVESTMENT OF ACCOUNT BALANCE.

               (i) Except as otherwise provided by the terms of an Award, the
Participant shall, at the time of making a deferred compensation election under
this Plan, make an election directing the Company to credit to the Deferred
Compensation Account in that calendar year based upon the options made available
by the Board or designated Committee which options may include either cash,
Stock, or a combination of cash and Stock equal in value to the amount of the
current year's salary or bonus deferred under the Plan. In addition to cash or
Stock, the Board or the Committee may offer to the Participant such deemed
investment options as it shall decide are appropriate. Such investment options
may include deemed investments in individual stocks or bonds, mutual funds, and
such other investment options as the Board or Committee may choose. The Board or
Committee shall not be required to offer the same deemed investment options to
each Participant but may restrict certain investment options to designated
Participants. In the absence of a contrary election by a Participant, the amount
credited to a Deferred Compensation Account shall be credited as cash.

               (ii) If the Participant directs that any amount credited to the
Deferred Compensation account be credited in the form of Stock, the Board shall
credit to the Deferred Compensation Account sufficient shares of Stock equal in
value to the Deferred Compensation Account balance, or such lesser amount as the
Participant shall direct. The value of such Stock shall be determined in
accordance with a valuation methodology approved by the Board or by the
Committee. Except as provided in Section 12.6, such Stock credited to the
Deferred Compensation Account shall merely constitute a bookkeeping entry of the
Company, and (except as provided herein) the Participant shall have no voting,
dividend, or other legal or economic rights with respect to such Stock. At the
end of each fiscal quarter, an amount equivalent to all dividends which would
otherwise have been payable with respect to such Stock shall be credited to the
Deferred Compensation Account as additional Stock. The amount of the
Participant's Deferred Compensation Account that is credited as cash shall
accrue interest at a rate no less than the prime rate charged the Company by its
principal bank and shall not exceed the highest rate paid on Individual
Retirement Accounts ("IRAs") by the Bank plus two percent (2%). Such interest
with respect to a Deferred Compensation Account shall be credited to such
account quarterly, based on the weighted average daily prime rate or the IRA
rate for the three (3) month period ending on the last day of the quarter.

               (ii) The Participant shall elect the portion of their deferral to
be allocated to Stock or cash or such other option as made available by the
Board at the time of making such election to defer compensation. Such allocation
may not be amended with respect to such deferral. Any allocation to Stock shall
be paid in the form of Stock. No Participant will be granted the right to take
payment of the Stock in cash rather than in shares.

               (iii) If, at any time, the deferral of a Participant is allocated
to Stock, and such Participant shall be deemed to have violated the short-swing
profit rules of Section 16(b) of the Exchange Act through such allocation, the
allocation to Stock shall be void and such allocation shall default to cash.






                                       11




     12.3 PAYMENT OF DEFERRED COMPENSATION.

          (a) IN GENERAL. Amounts credited to a Participant's Deferred
Compensation Account shall be payable upon the Participant's Distribution Event.
The Participant shall determine the method of distributing the amounts in the
Deferred Compensation Account at the time the first election to participate in
the Plan is made, which shall be either a single distribution or a series of up
to ten (10) consecutive, substantially equal annual installments paid to such
Participant or his or her beneficiary, as the case may be, on or before January
15 of each year, commencing in the year following the Distribution Event. If no
such election is made, the method of distribution shall be determined solely by
the Board. If the Participant has elected to receive installment distributions,
and less than the full value of the Participant's Deferred Compensation Account
balance has been distributed as of the date of his or her death, the balance
shall be paid to the Participant's beneficiary in accordance with the same
method in effect at the Participant's death, except that the beneficiary may
elect, with the consent of the Committee, to receive the balance of the Deferred
Compensation Account in a single lump sum. For purposes of this Article 12, a
Participant's "beneficiary" shall mean the person or persons designated by the
Participant pursuant to Section 11.5 of this Plan, or, in the absence of such
designation or if no such person survives the Participant, the Participant's
estate. If any portion of the Participant's Deferred Compensation Account is
credited with Stock, then distributions from that portion of the Deferred
Compensation Account shall be made directly in the form of Stock. Undistributed
amounts shall continue to earn interest or accrue dividends, as the case may be.

          (b) MODIFICATION OF PAYMENT TERMS. A Participant may change a
Distribution Election at any time at least sixty (60) days prior to a
Distribution Event. If a Participant electing to participate in the Plan ceases
to be an employee of the Company or a member of the Board, prior to full payment
of the entire amount in the Deferred Compensation Account, shall, after
reasonable warning from the Board, persist in an affiliation with any business
that is a principal competitor with a significant portion of the business
conducted by the Company, the entire balance of such Deferred Compensation
Account may, if directed by the Board in its sole discretion, be paid
immediately to such Participant in a lump sum. In the event a Participant dies
prior to receiving payment of the entire amount in the Deferred Compensation
Account, the unpaid balance shall be paid to such beneficiary as may have been
designated by the Participant in writing to the Company as the person, firm or
trust to receive any post-death distribution under this Plan, or, in the absence
of such written designation, to the legal representative or any person, firm or
organization designated in the Participant's last will to receive such
distributions.

          (c) CHANGE IN CONTROL. In the event of a Change in Control, a
Participant shall be permitted to elect to receive a distribution of all or a
portion of his or her Deferred Compensation Account, provided that any such
election hereunder must be made within the period commencing thirty days prior
to such Change in Control and ending on the date of such Change in Control. Any
distribution pursuant to this Section 12.3(c) shall be made (i) in the form of
cash and/or Stock as his or her Deferred Compensation Account is allocated and
(ii) within seven (7) days subsequent to the Change in Control.

          (d) HARDSHIP DISTRIBUTION IN THE CASE OF FINANCIAL EMERGENCY. Prior to
the time a Deferred Compensation Account of a Participant would otherwise become
payable, the Committee, in its sole discretion, may elect to distribute all or a
portion of the Deferred Compensation Account in the event such Participant
requests a distribution by reason of severe financial hardship. For purposes of
this Plan, severe financial hardship shall be deemed to exist in the event the
Committee determines that a Participant needs a distribution to meet immediate
and heavy financial needs resulting from a sudden or unexpected illness or
accident of the Participant, or a member of his or her family, loss of the
Participant's property due to casualty, or other similar extraordinary and
unforeseeable circumstances arising as a result of events beyond the control of
the Participant. A distribution based on financial hardship shall not exceed the
amount required to meet the immediate financial need created by the hardship. In
the event the Participant is a member of the Committee making such
determination, the Participant shall not participate in the decision by the
Committee.

     12.4 TRUST PROVISIONS.

          (a) ESTABLISHMENT OF TRUST. The Company may in its sole discretion
establish one or more trusts to provide a source of payment for its obligations
under the Plan and such trust shall be permitted to hold cash, Stock, or other
assets to the extent of the Company's obligations hereunder. The Company may,
but is




                                       12



not required to, utilize a single trust with respect to its obligations to
Participants who are members of the Board and Participants who are not members
of the Board.

          (b) CLAIMS OF THE COMPANY'S CREDITORS. All assets held by any trust
created hereunder and all distributions to be made by any trustee pursuant to
this Plan and any trust agreement shall be subject to the claims of general
creditors of the Company, including judgment creditors and bankruptcy creditors.
The rights of a Participant or his or her beneficiaries in or to any assets of
the trust shall be no greater than the rights of an unsecured creditor of the
Company.

          (c) NOTIFICATION OF INSOLVENCY. In the event the Company becomes
insolvent, the Chief Executive Officer and Chairman of the Board of the Company
shall immediately notify the trustees of all trusts created hereunder of that
fact. The trustees shall make no distributions to any Participant or any
beneficiary from any assets held in trust pursuant to the Plan after such
notification is received or at any time after the trustee has actual knowledge
that the Company is insolvent. Under any such circumstance, the trustee shall
dispose of property held in trust pursuant to the Plan only as a court of
competent jurisdiction may direct. For purposes of this Plan, the Company shall
be deemed "insolvent" by the trustee if the Company is subject to a pending
voluntary or involuntary proceeding as a debtor under the United States
Bankruptcy Code, as the same may be amended from time to time, whether or not
the Company has provided the trustee with the notification required by this
Section 12.4(c), or if the trustee has been notified pursuant to this Section
12.4(c) that the Company is insolvent.

          12.5 NON-ASSIGNMENT. No right or interest of any Participant or any
person claiming through or under such Participant in the Particiapant's Deferred
Compensation Account shall be assignable or transferable in any manner or be
subject to alienation, anticipation, sale, pledge, encumbrance or other legal
process (including execution, levy, garnishment, attachment, bankruptcy, or
otherwise) or in any manner be subject to the debts or liabilities of such
Participant. If any Participant or any such person shall attempt to or shall
transfer, assign, alienate, anticipate, sell, pledge or otherwise encumber his
or her benefits hereunder or any part thereof, or if by reason of his or her
bankruptcy or other event happening at any time such benefits would devolve upon
anyone else or would not be enjoyed by him or her, then the Committee, in its
discretion, may terminate his or her interest in any such benefit to the extent
the Committee considers necessary or advisable to prevent or limit the effects
of such occurrence. Termination shall be effected by filing a written
declaration of termination with the Committee's records and making reasonable
efforts to deliver a copy to such Participant or any such other person or his or
her legal representative. As long as any Participant is alive, any amounts
affected by the termination shall be retained by the Company or the trustee of
any trust established pursuant to Section 12.4 of this Plan and, in the
Committee's sole and absolute discretion, may be paid to or expended for the
benefit of such Participant, his or her spouse, his or her children, or any
other person or persons in fact dependent upon him or her in such a manner as
the Committee shall deem proper.

                                   ARTICLE 13
                          CHANGES IN CAPITAL STRUCTURE

     13.1 GENERAL.

          (a) SHARES AVAILABLE FOR GRANT. In the event of any change in the
number of shares of Stock outstanding by reason of any stock dividend or split,
recapitalization, merger, consolidation, combination or exchange of shares or
similar corporate change, the maximum aggregate number of shares of Stock with
respect to which the Committee may grant Awards shall be appropriately adjusted
by the Committee. In the event of any change in the number of shares of Stock
outstanding by reason of any other event or transaction, the Committee may, but
need not, make such adjustments in the number and class of shares of Stock with
respect to which Awards may be granted as the Committee may deem appropriate.

          (b) OUTSTANDING AWARDS - INCREASE OR DECREASE IN ISSUED SHARES WITHOUT
CONSIDERATION. Subject to any required action by the shareholders of the
Company, in the event of any increase or decrease in the number of issued shares
of Stock resulting from a subdivision or consolidation of shares of Stock or the
payment of a stock dividend (but only on the shares of Stock), or any other
increase or decrease in the number of such shares effected without receipt or
payment of consideration by the Company, the



                                       13



Committee shall proportionally adjust the number of shares of Stock subject to
each outstanding Award and the exercise price per share of Stock of each such
Award.

          (c) OUTSTANDING AWARDS - CERTAIN MERGERS. Subject to any required
action by the shareholders of the Company, in the event that the Company shall
be the surviving corporation in any merger or consolidation (except a merger or
consolidation as a result of which the holders of shares of Stock receive
securities of another corporation), each Award outstanding on the date of such
merger or consolidation shall pertain to and apply to the securities which a
holder of the number of shares of Stock subject to such Award would have
received in such merger or consolidation.

          (d) OUTSTANDING AWARDS - CERTAIN OTHER TRANSACTIONS. In the event of
(i) a dissolution or liquidation of the Company, (ii) a sale of all or
substantially all of the Company's assets, (iii) a merger or consolidation
involving the Company in which the Company is not the surviving corporation or
(iv) a merger or consolidation involving the Company in which the Company is the
surviving corporation but the holders of shares of Stock receive securities of
another corporation and/or other property, including cash, the Committee shall,
in its absolute discretion, have the power to:

               (1) cancel, effective immediately prior to the occurrence of such
event, each Award outstanding immediately prior to such event (whether or not
then exercisable), and, in full consideration of such cancellation, pay to the
Participant to whom such Award was granted an amount in cash, for each share of
Stock subject to such Award, respectively, equal to the excess of (A) the value,
as determined by the Committee in its absolute discretion, of the property
(including cash) received by the holder of a share of Stock as a result of such
event over (B) the exercise of such Award; or

               (2) provide for the exchange of each Award outstanding
immediately prior to such event (whether or not then exercisable) for an option,
a stock appreciation right, restricted stock award, performance share award or
performance-based award with respect to, as appropriate, some or all of the
property for which such Award is exchanged and, incident thereto, make an
equitable adjustment as determined by the Committee in its absolute discretion
in the exercise price or value of the option, stock appreciate right, restricted
stock award, performance share award or performance-based award or the number of
shares or amount of property subject to the option, stock appreciation right,
restricted stock award, performance share award or performance-based award or,
if appropriate, provide for a cash payment to the Participant to whom such Award
was granted in partial consideration for the exchange of the Award, or any
combination thereof.

          (e) OUTSTANDING AWARDS - OTHER CHANGES. In the event of any other
change in the capitalization of the Company or corporate change other than those
specifically referred to in this Article, the Committee may, in its absolute
discretion, make such adjustments in the number and class of shares subject to
Awards outstanding on the date on which such change occurs and in the per share
exercise price of each Award as the Committee may consider appropriate to
prevent dilution or enlargement of rights.

          (f) NO OTHER RIGHTS. Except as expressly provided in the Plan, no
Participant shall have any rights by reason of any subdivision or consolidation
of shares of stock of any class, the payment of any dividend, any increase or
decrease in the number of shares of stock of any class or any dissolution,
liquidation, merger, or consolidation of the Company or any other corporation.
Except as expressly provided in the Plan, no issuance by the Company of shares
of stock of any class, or securities convertible into shares of stock of any
class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number of shares of Stock subject to an Award or the exercise
price of any Award.

                                   ARTICLE 14
                    AMENDMENT, MODIFICATION, AND TERMINATION

     14.1 AMENDMENT, MODIFICATION, AND TERMINATION. At any time and from time to
time, the Board may terminate, amend or modify the Plan; provided, however, that
the Board shall not, without the affirmative vote of the holder of a majority of
the voting stock of the Company, make any amendment which would (i) abolish the
Committee without designating such other committee, change the qualifications of
its members, or withdraw the administration of the Plan from its supervision,
(ii) increase the maximum number of shares of Stock



                                       14



for which Awards may be granted under the Plan, (iii) amend the formula for
determination of the exercise price Options, (iv) extend the term of the Plan,
and (v) amend the requirements as to the employees eligible to receive Awards;
and further provided that no other amendment shall be made without shareholder
approval to the extent necessary or desirable to comply with any applicable law,
regulations or stock exchange rule.

     14.2 AWARDS PREVIOUSLY GRANTED. Except as otherwise provided in the Plan,
including without limitation, the provisions of Article 13, no termination,
amendment, or modification of the Plan shall adversely affect in any material
way any Award previously granted under the Plan, without the written consent of
the Participant.

                                   ARTICLE 15
                               GENERAL PROVISIONS

     15.1 NO RIGHTS TO AWARDS. No Participant, employee, or other person shall
have any claim to be granted any Award under the Plan, and neither the Company
nor the Committee is obligated to treat Participants, employees, and other
persons uniformly.

     15.2 NO STOCKHOLDERS RIGHTS. No Award gives the Participant any of the
rights of a stockholder of the Company unless and until shares of Stock are in
fact issued to such person in connection with such Award.

     15.3 WITHHOLDING. The Company shall have the authority and the right to
deduct or withhold, or require a Participant to remit to the Company, an amount
sufficient to satisfy Federal, state, and local taxes (including the
Participant's FICA obligation) required by law to be withheld with respect to
any taxable event arising as a result of this Plan. A Participant may elect to
have the Company withhold from those Stock that would otherwise be received upon
the exercise of any Option, a number of shares having a Fair Market Value equal
to the minimum statutory amount necessary to satisfy the Company's applicable
federal, state, local and foreign income and employment tax withholding
obligations.

     15.4 NO RIGHT TO EMPLOYMENT OR SERVICES. Nothing in the Plan or any Award
Agreement shall interfere with or limit in any way the right of the Company to
terminate any Participant's employment or services at any time, nor confer upon
any Participant any right to continue in the employ of the Company.

     15.5. INDEMNIFICATION. To the extent allowable under applicable law, each
member of the Committee or of the Board shall be indemnified and held harmless
by the Company from any loss, cost, liability, or expense that may be imposed
upon or reasonably incurred by such member in connection with or resulting from
any claim, action, suit, or proceeding to which he or she may be a party or in
which he or she may be involved by reason of any action or failure to act under
the Plan and against and from any and all amounts paid by him or her in
satisfaction of judgment in such action, suit, or proceeding against him or her
provided he or she gives the Company an opportunity, at its own expense, to
handle and defend the same before he or she undertakes to handle and defend it
on his or her own behalf. The foregoing right of indemnification shall not be
exclusive of any other rights of indemnification to which such persons may be
entitled under the Company's Articles of Incorporation or Bylaws, as a matter of
law, or otherwise, or any power that the Company may have to indemnify them or
hold them harmless.

     15.6 FRACTIONAL SHARES. No fractional shares of stock shall be issued and
the Committee shall determine, in its discretion, whether cash shall be given in
lieu of fractional shares or whether such fractional shares shall be eliminated
by rounding up or down as appropriate.

     15.7 GOVERNMENT AND OTHER REGULATIONS. The obligation of the Company to
make payment of awards in Stock or otherwise shall be subject to all applicable
laws, rules, and regulations, and to such approvals by government agencies as
may be required. The Company shall be under no obligation to register under the
Securities Act of 1933, as amended, any of the shares of Stock paid under the
Plan. If the shares paid under the Plan may in certain circumstances be exempt
from registration under the Securities Act of 1933, as amended, the



                                       15



Company may restrict the transfer of such shares in such manner as it deems
advisable to ensure the availability of any such exemption.

     15.8 GOVERNING LAW. The Plan and the terms of all Awards shall be construed
in accordance with and governed by the laws of the State of Ohio.




















                                       16

EX-13

                                                                      Exhibit 13









                                     [PHOTO]
























                            [PVF CAPITAL CORP. LOGO]
                            ------------------------

                         Annual Report - June 30, 2003





























TABLE OF  CONTENTS


             -------------------------------------------------------------------
             Letter to Shareholders                                          1

             Park View Federal - A Family Tradition                          3

             Selected Consolidated Financial and Other Data                  6

             Management's Discussion and Analysis of Financial Condition
             and Results of Operations                                       8

             Independent Auditors' Report                                   21




          [PVF CAPITAL CORP. LOGO]
          ----------------------------------------------------------------------


TO OUR SHAREHOLDERS

          We are pleased to report that PVF Capital Corp. achieved record
          operating results for the year ended June 30, 2003. Earnings were $8.1
          million, or $1.27 basic earnings per share and $1.25 diluted earnings
          per share. Return on average assets was 1.15 percent and return on
          average common equity was 14.60 percent for the year.

          The Company's consolidated assets increased by $63.8 million, or 9.4
          percent, to $743.4 million, while total stockholders' equity increased
          by $6.3 million, or 12.0 percent, to $58.6 million at June 30, 2003.
          In addition, the loan portfolio grew by $38.0 million, or 6.6 percent,
          and deposits increased by $46.7 million, or 9.7 percent, for the year
          ended June 30, 2003. During a challenging period of sharply declining
          and historically low market interest rates, the Company was able to
          improve its interest rate spread from 2.95 percent for the year ended
          June 30, 2002 to 3.13 percent for the year ended June 30, 2003.

          Due to the efforts of our branch personnel and a strong staff of
          branch managers, we were able to close a record total of $646.2
          million in mortgage loans for the year. In addition, the Company sold
          $453.7 million in fixed-rate mortgage loans and recorded record net
          profits of $4.9 million on mortgage banking activities for the year.
          As a result of these sales, the Company was able to increase its
          mortgage servicing portfolio by $122.4 million to $650.7 million.

          In July and August 2002, Park View Federal successfully opened two new
          full-service branch offices in Strongsville and Avon, Ohio.
          Additionally, in the coming year, Park View Federal is planning to
          further expand its branch network with the opening of a new
          full-service branch office in Streetsboro, Ohio.

          The reconfiguration and growth of our branch network has opened new
          markets to us in residential, construction, multi-family and
          commercial real estate lending, and has also increased our ability to
          attract consumer deposits. We plan to continue our efforts to identify
          new locations for the further expansion of our branch network.




          Our stock repurchase program originally announced in June of 1999, to
          purchase up to 5 percent of the Company's common stock, was expanded
          in August 2002 to acquire up to an additional 5 percent of the
          Company's common stock. This plan was renewed for another 12 months in
          July 2003. Pursuant to this plan and our cash dividend policy, the
          Company repurchased 343,519 shares, or 5.1 percent, of its common
          stock through June 30, 2003 and paid a $0.296 per share cash dividend
          for the year. Continuation of the stock repurchase program and cash
          dividend policy will be dependent on the Company's financial
          condition, earnings, capital needs, regulatory requirements and market
          conditions. In July 2003, the Company declared a 10 percent stock
          dividend that was paid in August 2003.

          We welcome a new member to our Board of Directors. Ronald D. Holman,
          II is a partner in the law firm Cavitch, Familo, Durkin & Frutkin in
          Cleveland, Ohio.

          Visit our web site at www.parkviewfederal.com. The site provides
          information about our products and services, and provides access to
          current loan and deposit account rates, terms and other information.
          Our goal is to provide a full line of home banking services to our
          customers.

          We would like to thank our shareholders, customers and staff for their
          continued confidence, contributions and support in helping us achieve
          yet another successful year.

          We invite all shareholders to attend our Annual Meeting of
          Stockholders of PVF Capital Corp. on Monday, October 20, 2003, at PVF
          Capital Corp.'s Corporate Center, 30000 Aurora Road, Solon, Ohio. We
          look forward to another successful year of service and dedication to
          the community, its members, our shareholders and our customers.

                                             Sincerely,


                                             /s/ John R. Male
                                             John R. Male
                                             Chairman of the Board
                                             and Chief Executive Officer


                                             /s/ C. Keith Swaney
                                             C. Keith Swaney
                                             President





                                       2

PARK VIEW FEDERAL - A FAMILY TRADITION
- --------------------------------------------------------------------------------

This past October 9, 2002 was a tremendously sad day for Park View Federal. It
marked the end of one employee's 57 years of dedicated service to the bank. It
was the day Chairman Emeritus James W. Male passed away.

Jim Male was the original driving force behind our bank. Born and raised in
Cleveland, Ohio, he was a 1943 graduate of Ohio University. In June of 1945, he
left to serve overseas in World War II. He returned home to Cleveland in October
of that same year, having earned the Bronze Star. A month later, he began
working for Park View Savings and Loan Association, the company founded in 1920
by his father, Nathan C. ("N.C.") Male.

N.C. Male had been one of a group of local merchants and businessmen who joined
together to form a community building and loan association at the corner of East
93rd Street and Kinsman Avenue in Cleveland. Because the location was near the
entrance to Woodland Hills Park, they chose the name Park View Savings and Loan
Association. The following year, a sale of stock was completed, and the new
institution opened its doors in 1921. The Board of Directors selected N.C. Male
as managing officer.

[PHOTO]

Under N.C.'s leadership, the company survived the Great Depression of the early
1930s, remained solvent, and acquired a federal charter and deposit insurance by
1936. Following the Depression, Park View Savings experienced a period of growth
and expansion through World War II and the postwar era.

When Jim Male joined Park View in November 1945, as a teller and management
trainee, the bank had one office, four employees and approximately
$1.5 million in total assets. After serving as a teller, Mr. Male held a variety
of other positions; in his words, "whatever became available." During that time
he also attended classes at night and earned his law degree from Cleveland
Marshall Law School in June of 1951.

In 1950, the company became a federal mutual savings and loan and changed its
name to Park View Federal Savings and Loan Association of Cleveland, Ohio. By
1954, Jim Male had risen to the office of Executive Vice President and acquired
the responsibility of operating the bank. Among his initial accomplishments was
the opening of two new branch offices. In 1960, Jim Male was elected managing
officer.

[PHOTO]

Over the next 20 years, Park View Federal continued to grow and prosper. During
those years, Jim Male's innovative and forward thinking led to the addition of
nine branch offices, including a new main office, and the development of new
products and services. Throughout this period, Park View set a precedent for
adopting new technologies, beginning with the introduction of the bank's first
in-house computer system in 1963. This was also the time when Mr. Male fostered
the tradition of personal and community-oriented service that the bank is known
for today.





                                       3

PARK VIEW FEDERAL - A FAMILY TRADITION
- --------------------------------------------------------------------------------

The 1980s were a pivotal time for savings institutions. Like other area thrifts,
Park View had taken advantage of new and expanded regulations and had ventured
into new businesses and real estate developments. But deregulation soon led to
the S&L crisis of the late 1980s and forced the closing of many of the area's
thrift institutions. Park View remained open by taking tighter control, scaling
back its business operations, and trimming its branch offices from a high of 16
to 7 locations.

Throughout the 1990s, Park View returned to "its roots," honing its niche as a
real estate and construction lender. In 1994, the bank began to systematically
restructure and expand its branch office network, which was predominantly
located on the east side of Cleveland. Branches were closed, others were moved,
and new ones were opened all to better serve Park View's customers and to
attract new ones. In 1999, consolidations within the local banking community
presented Park View with opportunities to begin its expansion to the west side
of Cleveland.

Whether evolving and growing during prosperous times, or weathering through the
tough times to emerge ever stronger, with Jim Male's vision, tenacity, devotion
and tireless energy, Park View Federal became the successful company it is
today. His goals for Park View were, "to be the best real estate bank anywhere
and to do a good job for the customers, employees, and shareholders."

Jim Male was always happy to come to work, eager to see what challenges the day
had to offer. He had a remarkable way with people and thrived on helping them -
whether friends, families, or employees. He understood that people are a
company's greatest asset.

One of his most notable achievements was taking the company public on the NASDAQ
stock exchange on December 30, 1992, having raised the $8.5 million needed to
complete the IPO by December 21.

Two years later, on October 31, 1994, after shareholder approval, Park View
Federal Savings Bank reorganized its corporate structure into PVF Capital Corp.,
a unitary savings and loan holding company.

By the year 2000, accelerated growth spurred the need to consolidate internal
operations from two separate locations to one. For many years, it was Jim Male's
dream to house all of our administrative, corporate and executive offices "under
one roof." In September 2000, the bank acquired a four-story, 55,000 square-foot
office building in Solon, Ohio. Following a year of improvements, renovations
and updates to the building, Mr. Male achieved his dream with the opening of our
new Corporate Center, which now serves as headquarters for management and staff
of Park View Federal. The Corporate Center is also home to a full-service,
state-of-the-art branch. It was his last great accomplishment and one of which
he was most proud. So proud, that he commissioned a watercolor of the building
as it would appear in winter, and that image was developed into the company's
holiday greeting card.



                                     [PHOTO]



                                                           Park View Federal
                                                           Corporate Center



                                       4

- --------------------------------------------------------------------------------

For the past 83 years, the managing officer of Park View Federal has always been
a member of the Male family. The current Chief Executive Officer is John R.
Male, grandson of the first managing officer, N.C. Male. John "Jack" Male had
replaced his father, Jim, as President and Chief Operating Officer in July 1986.
And with Jim Male's retirement announced in October 2000, Jack was named
Chairman and Chief Executive Officer of Park View Federal Savings Bank and PVF
Capital Corp.

[PHOTO]

Jack Male remains committed to carry out his grandfather's, father's, and now
his vision for the future of the bank.

"At the close of this June 30, 2003, Park View Federal had reached assets of
$743.4 million, 15 branches and 198 employees. The restructuring and expansion
of our branch network has positively positioned the bank to compete effectively
within the rapidly changing financial services industry and has provided a
strong foundation for further growth. Our basic strategy remains to function as
a niche lender, providing customers a wide range of lending products,
collateralized by real estate, that may not be available to them at larger
banks. We remain optimistic about the future role of community banks and will
continue our efforts to identify new locations for the further growth of our
branch network. As we continue to grow, we remain committed to serving the
financial needs of our customers and pledge our continued efforts to provide the
best personal service to our customers, shareholders, and the communities we
serve.

My father considered himself a very lucky man who had a great life with no
regrets about anything. He would not want to be remembered with sadness. He
touched the lives of everyone at Park View and he will be remembered as the
happy, inspiring man who envisioned Park View Federal as it is today. This
annual report is dedicated to his memory."

                      Building on the Foundation of Service
                      -------------------------------------

                    [PHOTO] The New Streetsboro Branch Office


In the coming year, Park View Federal Savings Bank will open a full-service
branch office in the rapidly growing city of Streetsboro, Ohio in Portage
County.

This new 3,000 square-foot facility on Market Square Drive, just north of State
Route 14, will feature ample, convenient parking, drive-in banking facilities,
an ATM and a complete array of financial services for the community. The office
will be Park View's first office in the expanding Portage County market and will
bring the total of the bank's full-service branch office locations to sixteen.

Park View Federal prides itself on providing its customers superior service,
flexible lending programs, and a full range of deposit accounts and services.
Each of our branch managers is actively involved in the communities served.



                                       5


SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA


FINANCIAL CONDITION DATA:


                                                                                At June 30,
                                                          --------------------------------------------------------
                                                            2003        2002        2001        2000        1999
                                                          --------------------------------------------------------
(dollars in thousands)
                                                                                           
Total assets .........................................    $743,404    $679,620    $736,525    $612,986    $449,201
Loans receivable held for investment, net ............     579,671     563,550     573,643     513,670     395,551
Loans receivable held for sale, net ..................      33,604      11,680       6,152      10,738       1,772
Mortgage-backed securities held for investment, net ..       2,965       7,297      18,124       1,215       2,951
Cash equivalents and securities ......................      96,784      69,435     115,607      70,931      35,423
Deposits .............................................     526,429     479,672     480,532     440,982     331,242
FHLB advances and notes payable ......................     125,938     129,028     190,567     114,974      66,041
Stockholders' equity .................................      58,603      52,299      48,006      42,900      38,856

Number of:
Real estate loans outstanding ........................       4,778       4,484       4,431       4,160       3,527
Savings accounts .....................................      32,081      30,223      30,567      28,915      24,346
Offices ..............................................          15          13          12          11          10



OPERATING DATA:



                                                                             Year Ended June 30,
                                                          --------------------------------------------------------
                                                            2003        2002        2001        2000        1999
                                                          --------------------------------------------------------
(dollars in thousands except for earnings per share)

                                                                                           
Interest income ......................................    $ 43,482    $ 48,814    $ 53,962    $ 42,026    $ 35,347
Interest expense .....................................      20,646      27,060      34,118      23,972      19,863
                                                          --------    --------    --------    --------    --------
Net interest income
  before provision for loan losses ...................      22,836      21,754      19,844      18,054      15,484
Provision for loan losses ............................           0         558         225         850           0
                                                          --------    --------    --------    --------    --------
Net interest income
  after provision for loan losses ....................      22,836      21,196      19,619      17,204      15,484
Non-interest income ..................................       5,893       3,751       2,600       2,681       5,435
Non-interest expense .................................      16,509      14,139      12,218      10,410       9,649
                                                          --------    --------    --------    --------    --------
Income before federal income taxes ...................      12,220      10,808      10,001       9,475      11,270
Federal income taxes .................................       4,124       3,635       3,365       3,365       3,163
                                                          --------    --------    --------    --------    --------
Net income ...........................................    $  8,096    $  7,173    $  6,636    $  6,312    $  7,719
                                                          ========    ========    ========    ========    ========

Basic earnings per share(1) ..........................    $   1.27    $   1.12    $   1.05    $   0.99    $   1.20
                                                          ========    ========    ========    ========    ========

Diluted earnings per share(1) ........................    $   1.25    $   1.09    $   1.02    $   0.96    $   1.15
                                                          ========    ========    ========    ========    ========






(1)Adjusted for stock dividends.

                            [PVF CAPITAL CORP. LOGO]
                               2003 Annual Report

                                       6



OTHER DATA:



                                                         At or For the Year Ended June 30,
                                             --------------------------------------------------------
                                                2003        2002        2001        2000        1999
                                             --------------------------------------------------------

                                                                               
Return on average assets ................       1.15%       1.03%       1.00%       1.21%       1.77%

Return on average equity ................      14.60%      14.19%      14.62%      15.45%      22.21%

Interest rate spread ....................       3.13%       2.95%       2.75%       3.21%       3.26%

Net interest margin .....................       3.37%       3.26%       3.09%       3.59%       3.68%

Average interest-earning assets to
  average interest-bearing liabilities ..     108.10%     107.64%     106.45%     107.98%     108.92%

Non-accruing loans (> 90 days) and
  repossessed assets to total assets ....       1.06%       1.23%       0.91%       0.87%       0.85%

Stockholders' equity to total assets ....       7.88%       7.70%       6.52%       7.00%       8.65%

Ratio of average equity to
  average assets ........................       7.86%       7.24%       6.79%       7.80%       7.95%

Dividend payout ratio ...................      20.44%      21.42%      20.78%      21.77%       0.00%




BANK REGULATORY CAPITAL RATIOS:

                                                                                
Ratio of tangible capital to
  adjusted total assets .................       7.73%       7.88%       6.46%       6.68%       7.99%

Ratio of core capital to
  adjusted total assets .................       7.73%       7.88%       6.46%       6.68%       7.99%

Ratio of Tier-1 risk-based capital to
  risk-weighted assets ..................      10.74%      10.84%       9.56%       9.24%      10.43%

Ratio of risk-based capital to
  risk-weighted assets ..................      11.43%      11.63%      10.26%      10.00%      11.17%






                            [PVF CAPITAL CORP. LOGO]
                               2003 Annual Report


                                       7


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

GENERAL

PVF Capital Corp. ("PVF" or the "Company") is the holding company for Park View
Federal Savings Bank ("Park View Federal" or the "Bank"), its principal and
wholly-owned subsidiary, and a federally chartered savings bank headquartered in
Solon, Ohio. Park View Federal has 15 offices located in Cleveland and
surrounding communities, including recently opened branches in Strongsville and
Avon, Ohio. An office in Streetsboro, Ohio will open later this year. The Bank's
principal business consists of attracting deposits from the general public
through its branch offices and investing these funds in loans secured by first
mortgages on real estate located in its market area, which consists of Cuyahoga,
Lake, Geauga, Portage, Summit, Stark, Medina, and Lorain Counties in Ohio. The
Bank has concentrated its activities on serving the borrowing needs of local
homeowners and builders in its market area by originating both fixed-rate and
adjustable-rate single-family mortgage loans, as well as construction loans,
commercial real estate loans, and multi-family residential real estate loans. In
addition, to a lesser extent, the Bank originates loans secured by second
mortgages, including equity line of credit loans secured by real estate, and non
real estate loans. Lending activities are influenced by the demand for and
supply of housing, competition among lenders, the level of interest rates, and
the availability of funds. Deposit flows and cost of funds are influenced by
prevailing market rates of interest, primarily on competing investments, account
maturities, and the level of personal income and savings in the market area.

FORWARD-LOOKING STATEMENTS

When used in this Annual Report, the words or phrases "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 wishes to caution readers not to place undue reliance on
any such forward-looking statements, which speak only as of the date made. The
Company wishes to advise 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
publicly release the result of any revisions which 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.

OVERVIEW OF FINANCIAL CONDITION AT JUNE 30, 2003, 2002, AND 2001

PVF had total assets of $743.4 million, $679.6 million, and $736.5 million at
June 30, 2003, 2002, and 2001, respectively. The primary source of the Bank's
total assets has been its loan portfolio. Net loans receivable and
mortgage-backed securities totaled $616.2 million, $582.5 million, and $597.9
million at June 30, 2003, 2002, and 2001, respectively. The increase of $33.7
million in net loans and mortgage-backed securities at June 30, 2003 resulted
from an increase in loans receivable of $38.0 million offset by the repayment of
mortgage-backed securities of $4.3 million. The increase in loans receivable
resulted from increases of $7.0 million in one-to-four family residential loans,
$14.4 million in commercial real estate loans, $14.5 million in home equity line
of credit loans, $11.2 million in commercial equity line of credit loans, $2.8
million in land loans, and $3.3 million in non real estate loans. These
increases were offset by decreases of $12.7 million in construction loans and
$2.5 million in multi-family loans. Securities totaled $0.03 million, $55.1
million, and $50.2 million, and cash and cash equivalents totaled $96.8 million,
$14.3 million, and $65.4 million at June 30, 2003, 2002, and 2001, respectively.

The securities portfolio has been and will continue to be used primarily to meet
the liquidity requirements of the Bank in its deposit taking and lending
activities.


                                       8


The Bank has adopted a policy that permits investment only in U.S. government
and agency securities or Triple-A-rated securities. The Bank invests primarily
in securities having a final maturity of five years or less, federal funds sold,
and deposits at the Federal Home Loan Bank ("FHLB") of Cincinnati. The entire
portfolio matures within five years or less, and the Bank has no plans to change
the short-term nature of its securities portfolio.

The Bank's deposits totaled $526.4 million, $479.7 million, and $480.5 million
at June 30, 2003, 2002, and 2001, respectively. Advances from the FHLB amounted
to $120.1 million, $120.7 million, and $185.9 million at June 30, 2003, 2002,
and 2001, respectively. Management's decision to repay FHLB advances and to
compete with market savings rates resulted in a decrease in FHLB advances of
$0.6 million and an increase in savings deposits of $46.7 million for the year
ended June 30, 2003.

Funds from the decrease of $55.1 million in securities, increases of $46.7
million in deposits, an increase of $13.3 million in accrued expenses and other
liabilities, and the increase in stockholders' equity of $6.3 million were used
to fund the increase of $33.7 million in net loans and mortgage-backed
securities, the increase of $82.4 million in cash and cash-equivalents, the
repayments of $2.5 million in notes payable, and $0.6 million in FHLB advances.

CAPITAL
PVF's stockholders' equity totaled $58.6 million, $52.3 million, and $48.0
million at the years ended June 30, 2003, 2002, and 2001, respectively. The
increases were the result of the retention of net earnings less cash dividends
paid and purchased treasury stock.

The Bank's primary regulator, The Office of Thrift Supervision ("OTS") has
implemented a statutory framework for capital requirements which establishes
five categories of capital strength ranging from "well capitalized" to
"critically undercapitalized." An institution's category depends upon its
capital level in relation to relevant capital measures, including two risk-based
capital measures, a tangible capital measure, and a core/leverage capital
measure. At June 30, 2003, the Bank was in compliance with all of the current
applicable regulatory capital measurements to meet the definition of a
well-capitalized institution, as demonstrated in the following table:



                                    Park View                  Requirement for
                                     Federal       Percent of  Well-Capitalized
(dollars in thousands)               Capital        Assets(1)    Institution
                                   ---------------------------------------------
                                                           
GAAP capital                         $57,656           7.75%          N/A
Tangible capital                     $57,548           7.73%          N/A
Core capital                         $57,548           7.73%         5.00%
Tier-1 risk-based capital            $57,548          10.74%         6.00%
Risk-based capital                   $61,196          11.43%        10.00%


(1)Tangible and core capital levels are shown as a percentage of total adjusted
assets; risk-based capital levels are shown as a percentage of risk-weighted
assets.

COMMON STOCK AND DIVIDENDS
The Company's common stock trades under the symbol "PVFC" on the Nasdaq
Small-Cap Market. A 10 percent stock dividend was issued in September 1999,
September 2000, August 2001, August 2002, and August 2003. As adjusted to
reflect all stock dividends and purchases of treasury stock, the Company had
6,374,489 shares of common stock outstanding and approximately 247 holders of
record of the common stock at September 9, 2003. OTS regulations applicable to
all Federal Savings Banks such as Park View Federal limit the dividends that may
be paid by the Bank to PVF. Any dividends paid may not reduce the Bank's capital
below minimum regulatory requirements.

In June 1999, the Company announced a stock repurchase program to acquire up to
5 percent of the Company's common stock and a quarterly cash dividend policy. In
August 2002, the Company announced that it had implemented a new stock
repurchase program to acquire up to an additional 5 percent of the Company's
common stock. The stock repurchase program is dependent on market conditions
with no guarantee as to the exact number of shares to be repurchased. At June
30, 2003, as adjusted to reflect all stock dividends, the Company had acquired a
total of 343,519 shares, or 5.1 percent of the Company's common stock. The cash
dividend policy remains dependent upon the Company's financial condition,
earnings, capital needs, regulatory requirements, and economic conditions. A
quarterly cash dividend of $0.072 per share, $0.074 per share, and $0.074 per
share was paid on the Company's outstanding common stock in fiscal 2001, 2002,
and 2003, respectively.


                            [PVC CAPITAL CORP. LOGO]
                               2003 Annual Report

                                       9




The following table sets forth certain information as to the range of the high
and low bid prices for the Company's common stock for the calendar quarters
indicated.(1)



                                   Fiscal 2003                Fiscal 2002
                            ----------------------------------------------------
                             High Bid       Low Bid      High Bid      Low Bid
                            -------------------------  -------------------------
                                                          
Fourth Quarter              $   13.41     $   11.82     $   10.95     $   8.93
Third Quarter                   13.01         10.91          9.23         8.26
Second Quarter                  11.79          9.18          9.30         7.68
First Quarter                    9.93          6.27         11.57         7.68


(1)Quotations reflect inter-dealer prices without retail mark-up, mark-down, or
commission, and may not represent actual transactions. Bid prices have been
adjusted to reflect the previously described stock dividends.

LIQUIDITY AND CAPITAL RESOURCES
The Company's liquidity measures its ability to fund loans and meet withdrawals
of deposits and other cash outflows in a cost-effective manner. The Company's
primary sources of funds for operations are deposits from its primary market
area, principal and interest payments on loans and mortgage-backed securities,
sales of loans and mortgage-backed securities, proceeds from maturing
securities, and advances from the FHLB of Cincinnati. While loan and
mortgage-backed securities payments and maturing securities are relatively
stable sources of funds, deposit flows and loan prepayments are greatly
influenced by prevailing interest rates, economic conditions, and competition.
FHLB advances may be used on a short-term basis to compensate for deposit
outflows or on a long-term basis to support expanded lending and investment
activities.

The Bank uses its capital resources principally to meet its ongoing commitment
to fund maturing certificates of deposit and deposit withdrawals, repay
borrowings, fund existing and continuing loan commitments, maintain its
liquidity, and meet operating expenses. At June 30, 2003, the Bank had
commitments to originate loans totaling $79.5 million and had $59.8 million of
undisbursed loans in process. Scheduled maturities of certificates of deposit
during the 12 months following June 30, 2003 totaled $249.3 million. Management
believes that a significant portion of the amounts maturing during fiscal 2004
will be reinvested with the Bank because they are retail deposits, however, no
assurances can be made that this will occur.

Park View Federal maintains liquid assets sufficient to meet operational needs.
The Bank's most liquid assets are cash and cash equivalents, which are
short-term, highly-liquid investments with original maturities equal to or less
than three months that are readily convertible to known amounts of cash. The
levels of such assets are dependent upon the Bank's operating, financing, and
investment activities at any given time. Management believes that the liquidity
levels maintained are more than adequate to meet potential deposit outflows,
repay maturing FHLB advances, fund new loan demand, and cover normal operations.

MARKET RISK MANAGEMENT
Market risk is the risk of loss arising from adverse changes in the fair value
of financial instruments due to changes in interest rates, exchange rates, and
equity prices. The Bank's market risk is composed of interest rate risk.

Asset/Liability Management: The Bank's asset and liability committee ("ALCO"),
which includes senior management representatives, monitors and considers methods
of managing the rate sensitivity and repricing characteristics of the balance
sheet components consistent with maintaining acceptable levels of changes in net
portfolio value ("NPV") and net interest income. Park View Federal's asset and
liability management program is designed to minimize the impact of sudden and
sustained changes in interest rates on NPV and net interest income.


                      PROFILE OF INTEREST SENSITIVE ASSETS

                                  [PIE CHART]

                            
12.4% Overnight Fed funds      2.0% Fixed-rate other mortgage loans
 1.6% Non real estate loans   38.0% Adjustable-rate single-family mortgage loans
38.3% Adjustable-rate other    7.3% Fixed-rate single-family mortgage loans
      mortgage loans           0.4% Adjustable-rate mortgage-backed securities



                            [PVC CAPITAL CORP. LOGO]
                               2003 Annual Report

                                       10


                    PROFILE OF INTEREST SENSITIVE LIABILITIES

                                           
18.8% FHLB Advances over 13 months            38.9% CDs 12 months or less
 1.3% Other borrowings 60 months or less       2.1% CDs 25 to 36 months
10.4% Transaction accounts                    18.1% CDs 13 to 24 months
 6.7% Passbook accounts
 3.7% CDs over 36 months





The Bank's exposure to interest rate risk is reviewed on a quarterly basis by
the Board of Directors and the ALCO. Exposure to interest rate risk is measured
with the use of interest rate sensitivity analysis to determine the Bank's
change in NPV in the event of hypothetical changes in interest rates, while
interest rate sensitivity gap analysis is used to determine the repricing
characteristics of the Bank's assets and liabilities. If estimated changes to
NPV and net interest income are not within the limits established by the Board,
the Board may direct management to adjust its asset and liability mix to bring
interest rate risk within Board-approved limits.

In order to reduce the exposure to interest rate fluctuations, the Bank has
developed strategies to manage its liquidity, shorten its effective maturity,
and increase the interest rate sensitivity of its asset base. Management has
sought to decrease the average maturity of its assets by emphasizing the
origination of adjustable-rate residential mortgage loans and adjustable-rate
mortgage loans for the acquisition, development, and construction of residential
and commercial real estate, all of which are retained by the Bank for its
portfolio. In addition, all long-term, fixed-rate mortgages are underwritten
according to guidelines of the Federal Home Loan Mortgage Corporation ("FHLMC")
and the Federal National Mortgage Association ("FNMA") and are either swapped
with the FHLMC and the FNMA in exchange for mortgage-backed securities secured
by such loans, which are then sold in the market or sold directly for cash in
the secondary market.

Interest rate sensitivity analysis is used to measure the Bank's interest rate
risk by computing estimated changes in NPV of its cash flows from assets,
liabilities, and off-balance sheet items in the event of a range of assumed
changes in market interest rates. NPV represents the market value of portfolio
equity and is equal to the market value of assets minus the market value of
liabilities, with adjustments made for off-balance sheet items. This analysis
assesses the risk of loss in market risk sensitive instruments in the event of
an immediate and sustained 1 and 2 percent increase or decrease in market
interest rates. The Bank's Board of Directors has adopted an interest rate risk
policy which establishes maximum decreases in the NPV ratio (ratio of market
value of portfolio equity to the market value of portfolio assets) of 0.5 and
1.0 percent in the event of an immediate and sustained 1 and 2 percent increase
or decrease in market interest rates. The following table presents the Bank's
projected change in NPV for the various rate shock levels at June 30, 2003 and
2002. All market risk sensitive instruments presented in this table are held to
maturity or available for sale. The Bank has no trading securities.



(dollars in thousands)                      June 30, 2003                      June 30, 2002
                          -----------------------------------    --------------------------------------
   Change in               Market Value of    Dollar     NPV     Market Value of      Dollar       NPV
 Interest Rates           Portfolio Equity    Change    Ratio    Portfolio Equity     Change      Ratio
 --------------           ----------------    ------    -----    ----------------     ------      -----

                                                                               
      +2%                    $ 71,763       $ 6,455     9.37%       $ 74,641          $ 678      10.67%
      +1%                      68,847         3,539     8.95          75,347          1,384      10.71
       0                       65,308                   8.46          73,963                     10.46
      -1%                      59,358        (5,950)    7.66          70,065         (3,897)      9.88
      -2%                       N/A            N/A       N/A            N/A             N/A       N/A



                            [PVC CAPITAL CORP. LOGO]
                               2003 Annual Report

                                       11

The table illustrates that for June 30, 2002 and June 30, 2003, in the event of
an immediate and sustained increase in prevailing market interest rates, the
Bank's NPV ratio would be expected to increase, while in the event of an
immediate and sustained decrease in prevailing market rates, the Bank's NPV
ratio would be expected to decrease. The Bank carefully monitors the maturity
and repricing of its interest-earning assets and interest-bearing liabilities to
minimize the effect of changing interest rates on its NPV. At June 30, 2003, the
Bank's estimated changes in NPV ratio were within the targets established by the
Board of Directors in the event of an immediate and sustained increase in
prevailing market interest rates, but exceeded Board-approved target levels in
a decreasing interest rate environment. The Bank's interest rate risk ("IRR")
position currently exceeds Board-approved target levels in a decreasing interest
rate environment because of the maturity and repricing characteristics of assets
and liabilities. The balance sheet is primarily comprised of interest-earning
assets having a maturity and repricing period of from one month to five years.
These assets were funded utilizing interest-bearing liabilities having a final
maturity of two years or less and advances convertible at the option of the FHLB
of Cincinnati. Management will carefully monitor its IRR position and will make
the necessary adjustments to its asset and liability mix to bring the Bank's NPV
ratio to within target levels established by the Board of Directors.

NPV is calculated by the OTS using information provided by the Bank. The
calculation is based on the net present value of discounted cash flows utilizing
market prepayment assumptions and market rates of interest provided by Bloomberg
quotations and surveys performed during the quarters ended June 30, 2003 and
2002, with adjustments made to reflect the shift in the Treasury yield curve
between the survey date and the quarter-end date.

Computation of prospective effects of hypothetical interest rate changes are
based on numerous assumptions, including relative levels of market interest
rates, loan prepayments, and deposit decay, and should not be relied upon as
indicative of actual results. Further, the computations do not contemplate any
actions the Bank may undertake in response to changes in interest rates.

Certain shortcomings are inherent in the method of analysis presented in the
computation of NPV. Actual values may differ from those projections set forth in
the table, should market conditions vary from assumptions used in the
preparation of the table. Certain assets such as adjustable-rate loans, which
represent the Bank's primary loan product, have features which restrict changes
in interest rates on a short-term basis and over the life of the asset. In
addition, the proportion of adjustable-rate loans in the Bank's portfolio could
decrease in future periods if market interest rates remain at or decrease below
current levels due to refinance activity. Further, in the event of a change in
interest rates, prepayment and early withdrawal levels would likely deviate
significantly from those assumed in the table. Finally, the ability of many
borrowers to repay their adjustable-rate debt may decrease in the event of an
interest rate increase.

The Bank uses interest rate sensitivity gap analysis to monitor the relationship
between the maturity and repricing of its interest-earning assets and
interest-bearing liabilities, while maintaining an acceptable interest rate
spread. Interest rate sensitivity gap is defined as the difference between the
amount of interest-earning assets maturing or repricing within a specific time
period and the amount of interest-bearing liabilities maturing or repricing
within that time period. A gap is considered positive when the amount of
interest-rate-sensitive assets exceeds the amount of interest-rate-sensitive
liabilities, and is considered negative when the amount of
interest-rate-sensitive liabilities exceeds the amount of interest-rate-
sensitive assets. Generally, during a period of rising interest rates, a
negative gap would adversely affect net interest income, while a positive gap
would result in an increase in net interest income. Conversely, during a period
of falling interest rates, a negative gap would result in an increase in net
interest income, while a positive gap would negatively affect net interest
income. Management's goal is to maintain a reasonable balance between exposure
to interest rate fluctuations and earnings.

The following table summarizes the Bank's interest rate sensitivity gap analysis
at June 30, 2003. The table indicates that the Bank's one year and under ratio
of cumulative gap to total assets is a positive 29.7 percent, one-to-three year
ratio of cumulative gap to total assets is a positive 17.1 percent, and
three-to-five year ratio of cumulative gap to total assets is a positive 23.4
percent. The positive gap position of the Bank is consistent with the change in
the Bank's NPV ratio to an immediate and sustained 1 and 2 percent increase and
a 1 percent decrease in market interest rates.

                            [PVC CAPITAL CORP. LOGO]
                               2003 Annual Report

                                       12




                                               Within         1-3            3-5     Greater Than 5
(dollars in thousands)                         1 Year        Years          Years          Years        Total
- ------------------------------------------------------------------------------------------------------------------
                                                                                          
Total interest-rate-sensitive assets ......    $ 456,053     $ 110,204      $  91,399     $  45,613      $ 703,269
Total interest-rate-sensitive liabilities..      254,216       195,742         48,898       141,919        640,775
Periodic GAP ..............................      201,837       (85,538)        42,501       (96,306)        62,494
Cumulative GAP ............................      201,837       116,299        158,800        62,494
Ratio of cumulative GAP to total assets ...         29.7%         17.1%          23.4%          9.2%



COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET RISK

The Company is a party to financial instruments with off-balance sheet risk
including commitments to originate new loans, commitments to extend credit under
existing lines of credit and commitments to sell loans. These instruments
involve, to varying degrees, elements of credit and interest rate risk in excess
of the amount recognized in the consolidated balance sheet.

Off-balance sheet financial instruments whose contract amounts represent credit
and interest rate risk are summarized as follows:



                                                   June 30,
                                           ------------------------
(dollars in thousands)                       2003            2002
                                           -------         --------
                                                     
Commitments to originate:
  Mortgage loans held for sale             $66,782         $30,247
  Mortgage loans held for investment        12,669          14,173
  Unfunded home equity and
    commercial real estate lines of credit  68,445          53,882
Commitments to sell loans held for sale     89,630          25,733
Standby letters of credit                    1,417             519


Commitments to originate new loans or to extend credit are agreements
to lend to a customer as long as there is no violation of any condition
established in the contract. Loan commitments generally expire within 30 to 60
days. Most home equity line of credit commitments are for a term of five years,
and commercial real estate lines of credit are generally renewable every two
years. Commitments generally have fixed expiration dates or other termination
clauses and may require payment of a fee. 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 Company evaluates each
customer's creditworthiness on a case-by-case basis. The amount of collateral
obtained, if deemed necessary by the Company upon extension of credit, is based
on management's credit evaluation of the borrower.

Commitments to sell loans held for sale are agreements to sell loans to a third
party at an agreed-upon price. At June 30, 2003, the agreed-upon price of these
commitments exceeded the book value of loans to be sold. The fair value of
commitments to originate mortgage loans held for sale and commitments to sell
loans held for sale at June 30, 2003 was not considered material.

The following table presents as of June 30, 2003, PVF Capital Corp.'s
significant fixed and determinable contractual obligations by payment date. The
payment amounts represent those amounts contractually due to the recipient and
do not include any unamortized premiums or discounts or other similar carrying
value adjustments. Further discussion of the nature of each obligation is
included in the referenced note to the consolidated financial statements.

                            [PVC CAPITAL CORP. LOGO]
                               2003 Annual Report

                                       13




Contractual Obligations:
                                              Note     Within         1-3          3-5     Greater Than 5
(dollars in thousands)                     Reference   1 Year        Years        Years        Years        Total
- ---------------------------------------------------------------------------------------------------------------------
                                                                                        
Deposits without a stated maturity .....        7     $124,263           --           --           --     $124,263
Certificates of deposit ................        7      249,316      129,493       23,357           --      402,166
Advances from the FHLB of Cincinnati ...        8           42           81       20,000      100,000      120,123
Notes payable ..........................        9           79        2,678        3,058           --        5,815
Operating leases .......................       11          581          839          714          702        2,836



RESULTS OF OPERATIONS


GENERAL
PVF Capital Corp.'s net income for the year ended June 30, 2003 was $8.1
million, or $1.27 basic earnings per share and $1.25 diluted earnings per share
as compared to $7.2 million, or $1.12 basic earnings per share and $1.09 diluted
earnings per share for fiscal 2002, and $6.6 million, or $1.05 basic earnings
per share and $1.02 diluted earnings per share for fiscal 2001. All per share
amounts have been adjusted for stock dividends.

Net income for the current year increased by $0.9 million from the prior fiscal
year and was $1.5 million greater than net income for fiscal 2001.

NET INTEREST INCOME
Net interest income amounted to $22.8 million for the year ended June 30, 2003,
as compared to $21.8 million and $19.8 million for the years ended June 30, 2002
and 2001, respectively. Changes in the level of net interest income reflect
changes in interest rates and changes in volume of interest-earning assets and
interest-bearing liabilities. Tables 1 and 2 provide information as to changes
in the Bank's net interest income.

Table 1 sets forth certain information relating to the Bank's average
interest-earning assets (loans and securities) and interest-bearing liabilities
(deposits and borrowings) and reflects the average yield on assets and average
cost of liabilities for the periods and at the dates indicated. Such yields and
costs are derived by dividing interest income or interest expense by the average
daily balance of assets or liabilities, respectively, for the periods presented.
During the periods indicated, non-accrual loans are included in the net loan
category.

Table 1 also presents information for the periods indicated with respect to the
difference between the weighted-average yield earned on interest-earning assets
and weighted-average rate paid on interest-bearing liabilities, or "interest
rate spread," which savings institutions have traditionally used as an indicator
of profitability. Another indicator of an institution's net interest income is
its "net interest margin" or "net yield on interest-earning assets," which is
its net interest income divided by the average balance of net interest-earning
assets. Net interest income is affected by the interest rate spread and by the
relative amounts of interest-earning assets and interest-bearing liabilities.

Table 2 illustrates the extent to which changes in interest rates and shifts in
the volume of interest-related assets and liabilities have affected the Bank's
interest income and expense during the years indicated. The table shows the
changes by major component, distinguishing between changes relating to volume
(changes in average volume multiplied by average old rate) and changes relating
to rate (changes in average rate multiplied by average old volume). Changes not
solely attributable to volume or rate have been allocated in proportion to the
changes due to volume and rate.

                            [PVC CAPITAL CORP. LOGO]
                               2003 Annual Report

                                       14




Table 1                                                      AVERAGE BALANCES, INTEREST, AND AVERAGE YIELDS AND RATES
                                                                          FOR THE YEAR ENDED JUNE 30,
                                                             2003                     2002                        2001
                                                 ---------------------------------------------------------------------------------
                                                  Average           Yield/  Average            Yield/   Average            Yield/
(dollars in thousands)                            Balance  Interest  Cost   Balance  Interest   Cost    Balance  Interest   Cost
- ----------------------------------------------------------------------------------------------------------------------------------

                                                                                                 
Interest-earning assets:
  Loans                                          $601,122  $ 40,690  6.77% $581,812  $ 44,323   7.62%  $551,424  $ 48,101   8.72%
  Mortgage-backed securities                        4,705       285  6.06    11,662       719   6.17     16,059     1,189   7.40
  Securities and other interest-earning assets     70,861     2,507  3.54    73,588     3,772   5.13     74,046     4,672   6.31
                                                 --------  --------        --------  --------          --------  --------
    Total interest-earning assets                 676,688    43,482  6.43   667,062    48,814   7.32    641,529    53,962   8.41
                                                           --------                  --------                    --------
  Non-interest-earning assets                      27,709                    30,112                      26,786
                                                 --------                  --------                    --------
    Total assets                                 $704,397                  $697,174                    $668,315
                                                 ========                  ========                    ========

Interest-bearing liabilities:
  Deposits                                       $496,910  $ 15,170  3.05  $471,320  $ 20,995   4.45   $480,692  $ 27,080   5.63
  FHLB advances                                   122,034     5,205  4.27   142,820     5,824   4.08    117,624     6,682   5.68
  Notes payable                                     7,060       271  3.84     5,600       241   4.30      4,331       356   8.22
                                                 --------  --------        --------  --------          --------  --------
    Total interest-bearing liabilities            626,004    20,646  3.30   619,740    27,060   4.37    602,647    34,118   5.66
                                                           --------  ----            --------   ----             --------   ----
  Non-interest-bearing liabilities                 23,031                    26,947                      20,267
                                                 --------                  --------                    --------
    Total liabilities                             649,035                   646,687                     622,914

Stockholders' equity                               55,362                    50,487                      45,401
                                                 --------                  --------                    --------
    Total liabilities and stockholders' equity   $704,397                  $697,174                    $668,315
                                                 ========                  ========                    ========
Net interest income                                        $ 22,836                  $ 21,754                    $ 19,844
                                                           ========                  ========                    ========
Interest rate spread                                                 3.13%                      2.95%                       2.75%
                                                                     ====                       ====                        ====
Net yield on interest-earning assets                                 3.37%                      3.26%                       3.09%
                                                                     ====                       ====                        ====
Ratio of average interest-earning assets
  to average interest-bearing liabilities          108.10%                   107.64%                     106.45%
                                                 ========                  ========                    ========


As is evidenced by these tables, interest rate changes had a positive effect on
the Bank's net interest income for the years ended June 30, 2003 and June 30,
2002. Due to the repricing characteristics of the Bank's loan portfolio and
short-term nature of its deposit portfolio, along with declining interest rates
during much of the year ended June 30, 2003 and June 30, 2002, the Bank
experienced an increase of 18 basis points in its interest rate spread to 3.13
percent for fiscal 2003 from 2.95 percent for fiscal 2002, and during fiscal
2002 its interest rate spread increased 20 basis points from 2.75 percent for
fiscal 2001. These changes in interest rate spread contributed to an increase in
net interest income for the year ended June 30, 2003 of $0.5 million, and an
increase in net interest income for the year ended June 30, 2002 of $0.5 million
due to interest rate changes.

Net interest income was favorably affected by volume changes during the years
ended June 30, 2003 and 2002. Accordingly, net interest income grew by $0.6
million and $1.4 million due to volume changes for the years ended June 30, 2003
and 2002, respectively.

The rate/volume analysis illustrates the effect that volatile interest rate
environments can have on a financial institution. A flattening yield curve will
typically have a negative effect on net interest income, while a steepening
yield curve will typically have a positive effect on net interest income.

                            [PVC CAPITAL CORP. LOGO]
                               2003 Annual Report

                                       15




Table 2                                                                      YEAR ENDED JUNE 30,
                                                   -------------------------------------------------------------------------
                                                    2003           vs.        2002         2002          vs.         2001
                                                   ---------------------------------      ----------------------------------
                                                          Increase (Decrease)                     Increase (Decrease)
                                                                 Due to                                 Due to
                                                   ---------------------------------      ----------------------------------
(dollars in thousands)                             Volume         Rate        Total       Volume         Rate        Total
                                                   ---------------------------------      ----------------------------------
                                                                                                  
Interest income:
  Loans ........................................   $ 1,471      $(5,103)     $(3,632)     $ 2,315      $(6,093)     $(3,778)
  Mortgage-backed securities ...................      (429)          (5)        (434)        (271)        (199)        (470)
  Securities and other interest-earning assets .       (97)      (1,169)      (1,266)         (23)        (877)        (900)
                                                   -------      -------      -------      -------      -------      -------
    Total interest-earning assets ..............       945       (6,277)      (5,332)       2,021       (7,169)      (5,148)
                                                   -------      -------      -------      -------      -------      -------
Interest expense:
  Deposits .....................................     1,140       (6,965)      (5,825)        (417)      (5,667)      (6,084)
  FHLB advances ................................      (848)        (228)        (620)       1,028       (1,886)        (858)
  Notes payable ................................        63          (32)          31           54         (170)        (116)
                                                   -------      -------      -------      -------      -------      -------
    Total interest-bearing liabilities .........       355       (6,769)      (6,414)         665       (7,723)      (7,058)
                                                   -------      -------      -------      -------      -------      -------
Net interest income ............................   $   590      $   492      $ 1,082      $ 1,356      $   554      $ 1,910
                                                   =======      =======      =======      =======      =======      =======




PROVISION FOR LOAN LOSSES
The Bank carefully monitors its loan portfolio and establishes levels of general
and specific reserves for loan losses. Provisions for loan losses are charged to
earnings to bring the total allowances for loan losses to a level considered
adequate by management to provide for probable loan losses inherent in the loan
portfolio as of each balance sheet date, based on prior loss experience, volume
and type of lending conducted by the Bank, industry standards, and past due
loans in the Bank's loan portfolio. The Bank's policies require the review of
assets on a regular basis, and the Bank appropriately classifies loans as well
as other assets if warranted. The Bank establishes specific provisions for loan
losses when a loan is deemed to be uncollectible in an amount equal to the net
book value of the loan or to any portion of the loan deemed uncollectible. A
loan that is classified as either substandard or doubtful is assigned an
allowance based upon the specific circumstances on a loan-by-loan basis after
consideration of the underlying collateral and other pertinent economic and
market conditions. In addition, the Bank maintains general allowances based upon
the establishment of a risk category for each type of loan in the Bank's
portfolio.

The Bank uses a systematic approach in determining the adequacy of its loan loss
allowance and the necessary provision for loan losses, whereby the loan
portfolio is reviewed generally and delinquent loan accounts are analyzed
individually, on a monthly basis. Consideration is given primarily to the types
of loans in the portfolio and the overall risk inherent in the portfolio as well
as, with respect to individual loans, account status, payment history, ability
to repay and probability of repayment, and loan-to-value percentages. After
reviewing current economic conditions, changes in delinquency status, and actual
loan losses incurred by the Bank, management establishes an appropriate reserve
percentage applicable to each category of loans, and a provision for loan losses
is recorded when necessary to bring the allowance to a level consistent with
this analysis. During the year ended June 30, 2002, management conducted a
review of the established reserve percentages used in calculating the required
loan loss allowance. This review was conducted using the most currently
available national and regional aggregate thrift industry data on charge-offs
along with an analysis of historical losses experienced by the Bank according to
type of loan. As a result of this analysis, management made moderate adjustments
to the required reserve percentages on various loan categories to more
accurately reflect probable losses. Management believes it uses the best
information available to make a determination with respect to the allowance for
loan losses, recognizing that future adjustments may be necessary depending upon
a change in economic conditions.

                            [PVC CAPITAL CORP. LOGO]
                               2003 Annual Report

                                       16


During 2003, the Bank experienced growth in the loan portfolio of $38.0 million,
or 6.6 percent, while substantially maintaining the composition of the loan
portfolio. In addition, the level of impaired loans decreased from $13.0 million
to $12.8 million, while the specific allowance related to impaired loans
increased from $30,000 to $235,000. The decrease in the level of impaired loans
to total loans caused the percentage of allowance for loan losses to impaired
loans to increase from 30 to 31 percent. Net charge-offs decreased from $176,000
in 2002 to $19,000 in 2003. Therefore, taking into consideration the growth of
the portfolio, the level of impaired loans, as well as net charge-offs and the
overall performance of the loan portfolio, the Bank provided no additional
provision and maintained the allowance at a level deemed appropriate of $3.9
million.

During 2002, the Bank experienced a decline in the loan portfolio of $4.6
million, or 0.8 percent, while substantially maintaining the composition of the
loan portfolio. In addition, the level of impaired loans increased from $5.4
million to $13.0 million, while the specific allowance related to impaired loans
increased from $25,000 to $30,000. The increase in the level of impaired loans
to total loans caused the percentage of allowance for loan losses to impaired
loans to decrease from 65 to 30 percent. Net charge-offs increased from $93,000
in 2001 to $176,000 in 2002. Therefore, taking into consideration the higher
level of impaired loans, as well as the higher level of net charge-offs and the
overall performance of the loan portfolio, the Bank provided $558,000 of
additional provision to increase the allowance to a level deemed appropriate of
$3.9 million.

NON-INTEREST INCOME
Non-interest income amounted to $5.9 million, $3.8 million, and $2.6 million for
the years ended June 30, 2003, 2002, and 2001, respectively. The fluctuations in
non-interest income are due primarily to fluctuations in income derived from
mortgage banking activities, fee income on deposit accounts, gain on sale of
real estate, and rental income. Income attributable to mortgage banking
activities consists of loan servicing income, gains and losses on the sale of
loans and mortgage-backed securities, and market valuation provisions and
recoveries. Income from mortgage banking activities amounted to $4.9 million,
$3.0 million, and $1.1 million for the years ended June 30, 2003, 2002, and
2001, respectively. The increases in income from mortgage banking activities of
$1.9 million from the year ended June 30, 2001 to 2002, and from the year ended
June 30, 2002 to 2003, is primarily due to an increase in net profit realized on
the sale of loans. The results of operations from mortgage banking activity are
attributable in large part to historically low market interest rates and are not
necessarily indicative of expected future results. Other non-interest income
amounted to $971,000, $766,000, and $1,164,000 for the years ended June 30,
2003, 2002, and 2001, respectively. The decrease in other non-interest income of
$398,000 from the year ended June 30, 2001 to June 30, 2002 is attributable to a
decline in rental income in 2002. The increase in other non-interest income of
$205,000 from the year ended June 30, 2002 to June 30, 2003 is primarily due to
an increase in loan prepayment fee and late charge fee income. Changes in other
non-interest income are typically the result of service and other miscellaneous
fee income, rental income, insurance proceeds, income realized on the sale of
assets and investments, and the disposal of real estate owned properties.

NON-INTEREST EXPENSE
Non-interest expense amounted to $16.5 million, $14.1 million, and $12.2 million
for the years ended June 30, 2003, 2002, and 2001, respectively. The principal
component of non-interest expense is compensation and related benefits which
amounted to $8.7 million, $7.6 million, and $6.5 million for the years ended
June 30, 2003, 2002, and 2001, respectively. The increase in compensation for
the years ended June 30, 2002 and 2001 is due primarily to growth in the staff,
employee 401K benefits, a compensation incentive plan for management, and
inflationary salary and wage adjustments to employees. Office occupancy totaled
$3.2 million, $2.8 million, and $2.6 million for the years ended June 30, 2003,
2002, and 2001, respectively. The increased occupancy expense is attributable to
the cost of our Corporate Center in Solon, Ohio, maintenance and repairs to
office buildings, and the cost of opening and operating additional branch
offices. Other non-interest expense totaled $4.6 million, $3.7 million, and $3.1
million for the years ended June 30, 2003, 2002, and 2001, respectively. Changes

                            [PVC CAPITAL CORP. LOGO]
                               2003 Annual Report

                                       17

in other non-interest expense are primarily the result of advertising,
professional and legal services, insurance expenses, outside services, and
franchise tax expense.

FEDERAL INCOME TAXES
The Company's federal income tax expense was $4.1 million, $3.6 million, and
$3.4 million for the years ended June 30, 2003, 2002, and 2001, respectively.
Due to the availability of tax credits for the years ended June 30, 2002, 2001,
and 2000, and other miscellaneous deductions, the Company's effective federal
income tax rate was below the expected tax rate of 35 percent with an effective
rate of 34 percent for the years ended June 30, 2003, 2002, and 2001,
respectively.

IMPACT OF INFLATION AND CHANGING PRICES
The consolidated financial statements and related data presented herein have
been prepared in accordance with generally accepted accounting principles, which
requires the measurement of financial position and operating results in terms of
historical dollars, without considering changes in the relative purchasing power
of money over time due to inflation. Unlike most industrial companies,
substantially all of the assets and liabilities of the Bank are monetary in
nature. As a result, interest rates have a more significant impact on the Bank's
performance than the effects of general levels of inflation. Interest rates do
not necessarily move in the same direction or in the same magnitude as the
prices of goods and services, since such prices are affected by inflation to a
larger extent than interest rates. For further information regarding the effect
of interest rate fluctuations on the Bank, see "Market Risk Management."

CRITICAL ACCOUNTING POLICIES AND ESTIMATES
The accounting and reporting policies of PVF Capital Corp. are in accordance
with accounting principles generally accepted within the United States of
America and conform to general practices within the banking industry.
Application of these principles requires management to make estimates,
assumptions and judgments that affect the amounts reported in the financial
statements and accompanying notes. These estimates, assumptions and judgments
are based on information available as of the date of the financial statements.
Accordingly, as this information changes, the financial statements could reflect
different estimates, assumptions and judgments.

The most significant accounting policies followed by PVF Capital Corp. are
presented in Note 1 to the consolidated financial statements. Accounting and
reporting policies for the allowance for loan losses and mortgage servicing
rights are deemed critical since they involve the use of estimates and require
significant management judgments. PVF Capital Corp. provides further detail on
the methodology and reporting of the allowance for loan losses in Note 4 and
mortgage servicing rights in Note 5.

EFFECT OF NEW FINANCIAL ACCOUNTING STANDARDS
The Financial Accounting Standards Board (FASB) recently issued two new
accounting standards, Statement 149, "Amendment of Statement 133 on Derivative
Instruments and Hedging Activities," and Statement 150, "Accounting for Certain
Financial Instruments with Characteristics of Both Liabilities and Equities,"
both of which generally become effective in the quarter beginning July 1, 2003.
Management determined that adoption of the new standards will not materially
affect the Company's operating results or financial condition.


                            [PVC CAPITAL CORP. LOGO]


                                       18

[PARK VIEW FEDERAL LOGO]

- --------------------------------------------------------------------------------


Office Locations and Hours
                           Office Locations and Hours
                           --------------------------


                                                                                          
AVON OFFICE                      NORTH ROYALTON OFFICE           BEACHWOOD OFFICE                  SHAKER HEIGHTS OFFICE
36311 Detroit Road               13901 Ridge Road                La Place                          Shaker Towne Centre
Avon, Ohio 44011                 North Royalton, Ohio 44133      2111 Richmond Road                16909 Chagrin Blvd.
440-934-3580                     440-582-7417                    Beachwood, Ohio 44122             Shaker Hts., Ohio 44120
                                                                 216-831-6373                      216-283-4003
BAINBRIDGE OFFICE                SOLON OFFICE
8500 Washington Street           Solar Shopping Center           LAKEWOOD-CLEVELAND OFFICE         LOBBY
Chagrin Falls, Ohio 44023        34400 Aurora Road               11010 Clifton Blvd.               MON., TUES., WED., THURS.:
440-543-8889                     Solon, Ohio 44139               Cleveland, Ohio 44102             9:00 am - 4:30 pm
                                 440-542-6070                    216-631-8900                      FRIDAY:   9:00 am - 6:00 pm
BEDFORD OFFICE                                                                                     SATURDAY: 9:00 am - 1:00 pm
413 Northfield Road              STRONGSVILLE OFFICE             LOBBY
Bedford, Ohio 44146              17780 Pearl Road                MON., TUES., THURS.:
440-439-2200                     Strongsville, Ohio 44136        9:00 am - 4:30 pm
                                 440-878-6010                    FRIDAY: 9:00 am - 5:30 pm         CORPORATE CENTER OFFICE
CHARDON OFFICE                                                   SATURDAY: 9:00 am - 1:00 pm       30000 Aurora Road
408 Water Street                 LOBBY                           CLOSED WEDNESDAY                  Solon, Ohio 44139
Chardon, Ohio 44024              MON., TUES., WED., THURS.:                                        440-914-3900
440-285-2343                     9:00 am - 4:30 pm               AUTO TELLER
                                 FRIDAY: 9:00 am - 5:30 pm       MON., TUES., THURS.:
                                 SATURDAY: 9:00 am - 1:00 pm     9:00 am - 5:00 pm                 LOBBY & AUTO TELLER
MACEDONIA OFFICE                                                 FRIDAY: 9:00 am - 6:00 pm         MONDAY - FRIDAY:
497 East Aurora Road                                             SATURDAY: 9:00 am - 1:00 pm       9:00 am - 5:00 pm
Macedonia, Ohio 44056            AUTO TELLER                     CLOSED WEDNESDAY                  CLOSED SATURDAY
330-468-0055                     MON., TUES., WED., THURS.:
                                 9:00 am - 5:00 pm
MAYFIELD HEIGHTS OFFICE          FRIDAY: 9:00 am - 6:00 pm
1456 SOM Center Road             SATURDAY: 9:00 am - 1:00 pm
Mayfield Hts., Ohio 44124
440-449-8597

MEDINA OFFICE
Reserve Square
3613 Medina Road
Medina, Ohio 44256
330-721-7484

MENTOR OFFICE
Heisley Corners
6990 Heisley Road
Mentor, Ohio 44060
440-944-0276










                                       19


[PARK VIEW FEDERAL LOGO]
- --------------------------------------------------------------------------------



Board of Directors                            Officers
          Board of Directors                               Officers
- ---------------------------------             ----------------------------------
                                           
JOHN R. MALE                                  JOHN R. MALE
Chairman of the Board and                     Chairman of the Board and
Chief Executive Officer                       Chief Executive Officer

C. KEITH SWANEY                               C. KEITH SWANEY
President, Chief Operating Officer            President, Chief Operating Officer
and Chief Financial Officer                   and Chief Financial Officer

GERALD A. FALLON                              JEFFREY N. MALE
Retired                                       Executive Vice President

ROBERT K. HEALEY                              ANNE M. JOHNSON
Retired                                       Senior Vice President
                                              Operations
RONALD D. HOLMAN, II
Partner                                       CAROL S. PORTER
Cavitch, Familo, Durkin & Frutkin             Corporate Secretary and
                                              Marketing Director
STANLEY T. JAROS
Partner                                       EDWARD B. DEBEVEC
Moriarty & Jaros, P.L.L.                      Treasurer

RAYMOND J. NEGRELLI                           MARK E. FOSNAUGHT
President                                     Vice President
Raymond J. Negrelli, Inc.                     Branch Coordinator

STUART D. NEIDUS                              WILLIAM J. HARR, JR.
Chairman and                                  Vice President
Chief Executive Officer
Anthony & Sylvan Pools Corporation            ADELINE NOVAK
                                              Vice President
                                              Human Resources

                                              ROBERT J. PAPA
                                              Vice President
                                              Construction Lending

                                              JOHN E. SCHIMMELMANN
                                              Vice President
                                              Deposit Operations

                                              KENNAIRD H. STEWART
                                              Vice President
                                              Commercial Real Estate Lending




                                       20




                          INDEPENDENT AUDITORS' REPORT





The Board of Directors
PVF Capital Corp.
Solon, Ohio


We have audited the accompanying consolidated statements of financial condition
of PVF Capital Corp. (Company) as of June 30, 2003 and 2002, and the related
consolidated statements of operations, stockholders' equity, and cash flows for
the years ended June 30, 2003 and 2002. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits. The 2001 financial
statements were audited by other auditors, whose report dated July 27, 2001
expressed on unqualified opinion on those statements.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. 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 statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of PVF Capital Corp. as
of June 30, 2003 and 2002, and the results of its operations and its cash flows
for the years ended June 30, 2003 and 2002 in conformity with accounting
principles generally accepted in the United States of America.



                                                 Crowe, Chizek and Company, LLP





Cleveland, Ohio
August 1, 2003



                                       21


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                       Years ended June 30, 2003 and 2002



ASSETS                                                                         2003                2002
                                                                               ----                ----

                                                                                       
Cash and amounts due from depository institutions                        $   9,755,224       $   4,526,976
Interest bearing deposits                                                    3,946,019           1,736,712
Federal funds sold                                                          83,050,000           8,050,000
                                                                         -------------       -------------
  Cash and cash equivalents                                                 96,751,243          14,313,688
Securities held to maturity (fair value 2003-
  $33,252, 2002-$55,751,561)                                                    33,252          55,121,211
Mortgage-backed securities held to maturity (fair value 2003-
  $3,032,385, 2002-$7,500,739)                                               2,964,798           7,297,206
Loans receivable held for sale, net                                         33,603,895          11,679,735
Loans receivable, net of allowance of
  $3,882,839 and $3,901,839                                                579,670,681         563,550,556
Office properties and equipment, net                                        11,555,919           9,817,348
Real estate owned                                                              448,865             564,316
Federal Home Loan Bank stock                                                10,396,399           9,947,624
Prepaid expenses and other assets                                            7,978,751           7,328,431
                                                                         -------------       -------------
    Total assets                                                         $ 743,403,803       $ 679,620,115
                                                                         =============       =============

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:
  Deposits                                                               $ 526,428,927       $ 479,672,218
  Advances from the Federal Home Loan Bank of Cincinnati                   120,123,220         120,739,695
  Notes payable                                                              5,815,150           8,288,020
  Advances from borrowers for taxes and insurance                            7,964,653           7,320,613
  Accrued expenses and other liabilities                                    24,468,717          11,300,991
                                                                         -------------       -------------
    Total liabilities                                                      684,800,667         627,321,537
                                                                         -------------       -------------
Commitments and contingencies
Stockholders' equity:
  Serial preferred stock, $.01 par
   value, 1,000,000 shares authorized; none issued                                  --                  --
  Common stock, $.01 par value,
   15,000,000 shares authorized;
   6,717,283 and 6,064,809 shares issued, respectively                          67,173              60,648
  Additional paid-in capital                                                47,176,696          37,412,482
  Retained earnings                                                         14,486,460          17,627,665
  Treasury stock, at cost, 343,519 and 286,276 shares, respectively         (3,127,193)         (2,802,217)
                                                                         -------------       -------------
    Total stockholders' equity                                              58,603,136          52,298,578
                                                                         -------------       -------------
    Total liabilities and stockholders' equity                           $ 743,403,803       $ 679,620,115
                                                                         =============       =============



- --------------------------------------------------------------------------------
          See accompanying notes to consolidated financial statements.


                                       22



                       PVF CAPITAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                    Years ended June 30, 2003, 2002 and 2001



                                                2003             2002             2001
                                            -----------      -----------      -----------

                                                                     
Interest income:
  Loans                                     $40,690,675      $44,322,897      $48,100,662
  Mortgage-backed securities                    285,167          719,321        1,189,468
  Cash and securities                         2,506,855        3,772,463        4,671,814
                                            -----------      -----------      -----------
    Total interest income                    43,482,697       48,814,681       53,961,944
                                            -----------      -----------      -----------
Interest expense:
  Deposits                                   15,169,502       20,995,003       27,079,731
  Borrowings                                  5,476,773        6,065,389        7,038,219
                                            -----------      -----------      -----------
    Total interest expense                   20,646,275       27,060,392       34,117,950
                                            -----------      -----------      -----------
    Net interest income                      22,836,422       21,754,289       19,843,994
  Provision for loan losses                          --          558,000          225,000
                                            -----------      -----------      -----------
    Net interest income after
    provision for loan losses                22,836,422       21,196,289       19,618,994
                                            -----------      -----------      -----------
Noninterest income:
  Service and other fees                        743,877          625,631          562,613
  Mortgage banking activities, net            4,922,069        2,985,424        1,134,505
  Gain on sale of real estate                        --               --          300,790
  Rental income                                      --               --          270,528
  Other, net                                    227,057          139,913          331,150
                                            -----------      -----------      -----------
    Total noninterest income                  5,893,003        3,750,968        2,599,586
                                            -----------      -----------      -----------
Noninterest expense:
  Compensation and benefits                   8,694,397        7,643,251        6,493,661
  Office, occupancy, and equipment            3,151,956        2,758,158        2,586,580
  Insurance                                     262,366          226,511          208,279
  Professional and legal                        518,648          425,185          344,849
  Advertising                                   499,438          368,775          256,244
  Outside services                              857,050          520,181          355,626
  Franchise tax                                 647,890          581,990          496,338
  Other                                       1,877,460        1,614,584        1,475,833
                                            -----------      -----------      -----------
    Total noninterest expense                16,509,205       14,138,635       12,217,410
                                            -----------      -----------      -----------
    Income before federal income taxes       12,220,220       10,808,622       10,001,170

Federal income taxes:
  Current                                     3,966,092        3,431,586        3,128,578
  Deferred                                      157,672          203,727          236,714
                                            -----------      -----------      -----------
                                              4,123,764        3,635,313        3,365,292
                                            -----------      -----------      -----------
    Net income                              $ 8,096,456      $ 7,173,309      $ 6,635,878
                                            ===========      ===========      ===========
Basic earnings per share                    $      1.27      $      1.12      $      1.05
                                            ===========      ===========      ===========
Diluted earnings per share                  $      1.25      $      1.09      $      1.02
                                            ===========      ===========      ===========


- --------------------------------------------------------------------------------

          See accompanying notes to consolidated financial statements.


                                       23


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                    Years ended June 30, 2003, 2002 and 2001



                                                                Additional
                                                 Common           Paid-In          Retained         Treasury
                                                 Stock            Capital          Earnings           Stock           Total
                                                 -----            -------          --------           -----           -----

                                                                                                     
Balance at June 30, 2000                      $    48,333       24,784,942       19,039,966          (973,178)      42,900,063
  Net income                                           --               --        6,635,878                --        6,635,878
  Stock options exercised, 20,384
  shares                                              204           38,201               --                --           38,405
  Cash paid in lieu of fractional shares               --               --           (1,840)               --           (1,840)
  Stock dividend issued, 485,730 shares             4,857        6,523,354       (6,528,211)               --               --
  Cash dividend, $0.292 per share                      --               --       (1,376,934)               --       (1,376,934)
  Purchase of 21,488 shares of
  Treasury stock                                       --               --                           (189,437)        (189,437)
                                              -----------       ----------       ----------        ----------       ----------
Balance at June 30, 2001                           53,394       31,346,497       17,768,859        (1,162,615)      48,006,135
  Net income                                           --               --        7,173,309                          7,173,309
  Stock options exercised, 173,492
  shares                                            1,735          293,425               --                --          295,160
  Cash paid in lieu of fractional shares               --               --           (2,869)                            (2,869)
  Stock dividend issued, 551,870
  shares                                            5,519        5,772,560       (5,778,079)               --               --
  Cash dividend, $0.296 per share                      --               --       (1,533,555)                        (1,533,555)
  Purchase of 136,395 shares of
  Treasury stock                                       --               --               --        (1,639,602)      (1,639,602)
                                              -----------       ----------       ----------        ----------       ----------
Balance at June 30, 2002                           60,648       37,412,482       17,627,665        (2,802,217)      52,298,578
  Net income                                                                      8,096,456                --        8,096,456
  Stock options exercised, 41,909 shares              419          187,502               --                --          187,921
  Cash paid in lieu of fractional shares               --                            (2,159)               --           (2,159)
  Stock dividend issued, 610,565 shares             6,106        9,576,712       (9,582,818)               --               --
  Cash dividend, $0.296 per share                                       --       (1,652,684)               --       (1,652,684)
  Purchase of 28,615 shares of
  Treasury stock                                       --               --               --          (324,976)        (324,976)
                                              -----------       ----------       ----------        ----------       ----------
Balance at June 30, 2003                      $    67,173       47,176,696       14,486,460        (3,127,193)      58,603,136
                                              ===========       ==========       ==========        ==========       ==========



- --------------------------------------------------------------------------------
          See accompanying notes to consolidated financial statements.


                                       24



                       PVF CAPITAL CORP. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                    Years ended June 30, 2003, 2002 and 2001
- --------------------------------------------------------------------------------



                                                                     2003                2002                2001
                                                                 -----------         -----------         -----------
                                                                                                  
Operating activities:
  Net income                                                   $   8,096,456           7,173,309           6,635,878
  Adjustments required to reconcile net
    income to net cash provided by (used in)
    operating activities:
      Accretion of discount on securities                                  -                   -            (618,845)
      Depreciation                                                 1,407,503           1,060,530             710,375
      Provision for loan losses                                            -             558,000             225,000
      Accretion of unearned discount and
        deferred loan origination fees, net                       (1,244,214)         (1,130,822)         (1,132,931)
      FHLB stock dividends                                          (448,775)           (505,319)           (525,378)
      Deferred income tax provision                                 (157,672)           (203,727)           (236,714)
      Proceeds from loans held for sale                          460,462,639         295,706,407         106,047,642
      Originations of loans held for sale                       (475,659,784)       (301,234,328)       (101,461,735)
      Gain on the sale of loans, net                              (6,727,015)         (2,981,311)           (633,362)
      Net change in other assets and other liabilities            12,726,270          (1,213,531)          4,356,135
                                                                 -----------         -----------         -----------
        Net cash from operating activities                        (1,544,592)         (2,770,792)         13,366,065
                                                                 -----------         -----------         -----------
Investing activities:
  Loans originated                                              (177,261,741)       (135,864,877)       (226,319,550)
  Principal repayments on loans                                  162,351,576         149,065,323         147,331,835
  Principal repayments on mortgage-backed
    securities held to maturity                                    4,366,663          10,918,228           3,926,715
  Purchase of mortgage-backed securities held to maturity                  -                   -            (977,611)
  Purchase of securities held to maturity                        (30,000,000)        (55,000,000)        (99,918,836)
  Maturities and calls of securities held to maturity             85,087,959          50,090,394         115,584,929
  Federal Home Loan Bank (FHLB) stock purchased, net                       -                   -          (3,075,700)
  Additions to office properties and equipment                    (3,146,074)         (3,094,421)         (6,636,488)
  Disposals of real estate owned                                     114,259             353,100             740,442
  (Additions) disposal of real estate held for
     investment, net                                                 (50,000)           (350,000)          2,794,020
                                                                 -----------         -----------         -----------
      Net cash from investing activities                          41,462,642          16,117,747         (66,550,244)
                                                                 -----------         -----------         -----------





- --------------------------------------------------------------------------------
          See accompanying notes to consolidated financial statements.



                                       25

                       PVF CAPITAL CORP. AND SUBSIDIARIES
               CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
                    Years ended June 30, 2003, 2002 and 2001
- --------------------------------------------------------------------------------



                                                              2003                 2002                2001
                                                              ----                 ----                ----

                                                                                          
Financing activities:
  Payments on FHLB advances                                (10,616,476)       (183,127,160)        (89,106,985)
  Proceeds from FHLB advances                               10,000,000         118,000,000         160,000,000
  Proceeds from notes payable                                        -           6,650,000           4,700,000
  Repayment of notes payable                                (2,472,870)         (3,061,980)         (1,000,000)
  Net increase in NOW and passbook savings                  16,190,703          23,728,050           2,913,422
  Proceeds from issuance of certificates of deposit        135,463,914          88,664,759         124,038,791
  Payments on maturing certificates of deposit            (104,897,908)       (113,252,740)        (87,401,922)
  Net increase in advances from borrowers                      644,040             851,552             293,943
  Payment of cash dividend                                  (1,654,844)         (1,536,424)         (1,378,774)
  Purchase of Treasury stock                                  (324,975)         (1,639,602)           (189,437)
  Other                                                        187,921             295,160              38,404
                                                         -------------          ----------          ----------
    Net cash from financing activities                      42,519,505         (64,428,385)        112,907,442
                                                         -------------          ----------          ----------
    Net increase (decrease) in cash and
      cash equivalents                                      82,437,555         (51,081,430)         59,723,263
Cash and cash equivalents at beginning of year              14,313,688          65,395,118           5,671,855
                                                         -------------          ----------          ----------
Cash and cash equivalents at end of year                 $  96,751,243          14,313,688          65,395,118
                                                         =============          ==========          ==========
Supplemental disclosures of cash flow information:
  Cash payments of interest                              $  20,733,040          28,600,682          32,577,423
  Cash payments of income taxes                              4,020,000           2,825,000           3,399,482
Supplemental schedule of noncash investing and
 financing activities:
  Transfers to real estate owned                         $           -             355,132             742,981
  Loans securitized into mortgage-backed securities                  -                   -          16,400,000






- --------------------------------------------------------------------------------
          See accompanying notes to consolidated financial statements.


                                       26



                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001


- --------------------------------------------------------------------------------
NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS

The accounting and reporting policies of PVF Capital Corp. and its subsidiaries
(Company) conform to accounting principles generally accepted in the United
States of America and general industry practice. The Company's principal
subsidiary, Park View Federal Savings Bank (Bank), is principally engaged in the
business of offering savings deposits through the issuance of savings accounts,
money market accounts, and certificates of deposit and lending funds primarily
for the purchase, construction, and improvement of real estate in Cuyahoga,
Summit, Geauga, Lake, Medina and Lorain Counties, Ohio. The deposit accounts of
the Bank are insured under the Savings Association Insurance Fund (SAIF) of the
Federal Deposit Insurance Corporation (FDIC) and are backed by the full faith
and credit of the United States government. The following is a description of
the significant policies, which the Company follows in preparing and presenting
its consolidated financial statements.

Principles of Consolidation. The consolidated financial statements include the
accounts of PVF Capital Corp., and its wholly owned subsidiaries, Park View
Federal Savings Bank, PVF Service Corporation (PVFSC), PVF Holding, Inc., and
Mid-Pines Land Co. PVFSC owns some bank premises and leases them to the bank.
PVF Holding Inc. and Mid Pines Land Co. did not have any significant assets or
activity as of or for the years ended June 30, 2003 or 2002. All significant
intercompany transactions and balances are eliminated in consolidation.

Use of Estimates. The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
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. The allowance for loan losses and fair value of financial
instruments are particularly subject to change.

Allowance for Loan Losses. A loan is considered impaired when, based on current
information and events, it is probable that the Bank will be unable to collect
the scheduled payments of principal and interest according to the contractual
terms of the loan agreement. Since the Bank's loans are primarily collateral
dependent, measurement of impairment is based on the fair value of the
collateral.

The allowance for loan losses is maintained at a level to absorb probable
incurred losses inherent in the portfolio as of the balance sheet date. The
adequacy of the allowance for loan losses is periodically evaluated by the Bank
based upon the overall portfolio composition and general market conditions.
While management uses the best information available to make these evaluations,
future adjustments to the allowance may be necessary if economic conditions
change substantially from the assumptions used in making the evaluations.
Allocations of the allowance



- --------------------------------------------------------------------------------
                                   (Continued)


                                       27


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS
 (Continued)

may be made for specific loans, but the entire allowance is available for any
loan that, in management's judgment, should be charged-off. Loan losses are
charged against the allowance when management believes the uncollectibility of a
loan balance is confirmed. Future adjustments to the allowance may also be
required by regulatory examiners based on their judgments about information
available to them at the time of their examination. Uncollectable interest on
loans that are contractually 90 days or more past due is charged off, or an
allowance is established. The allowance is established by a charge to interest
income equal to all interest previously accrued, and income is subsequently
recognized only to the extent cash payments are received until the loan is
determined to be performing in accordance with the applicable loan terms in
which case the loan is returned to accrual status.

Mortgage Banking Activities. Mortgage loans held for sale are carried at the
lower of cost or fair value, determined on an aggregate basis.

The Company retains servicing on loans that are sold. The Company recognizes an
asset for mortgage servicing rights based on an allocation of total loan cost
using relative fair values, or a liability for mortgage servicing rights based
on fair value, if the benefits of servicing are not expected to adequately
compensate the Company. The cost of mortgage servicing rights is amortized in
proportion to, and over the period of, estimated net servicing revenues.
Impairment of mortgage servicing rights is assessed based on the fair value of
those rights. Fair values are estimated using discounted cash flows based on
current market interest rates and prepayment assumptions. For purposes of
measuring impairment, the rights are stratified based on predominant risk
characteristics of the underlying loans such as interest rates and scheduled
maturity. The amount of impairment recognized is the amount by which the
capitalized mortgage servicing rights exceed their fair value. The Company
monitors prepayments, and in the event that actual prepayments exceed original
estimates, amortization is adjusted accordingly.

Investment and Mortgage-Backed Securities. The Company classifies all securities
as held to maturity. Securities held to maturity are limited to debt securities
that the Company has the positive intent and the ability to hold to maturity;
these securities are reported at amortized cost. Investment and mortgage-backed
securities that could be sold in the future because of changes in interest rates
or other factors are not to be classified as held to maturity. Other securities
such as Federal Home Loan Bank stock are carried at cost.

Gains or losses on the sales or call of all securities are recognized at the
date of sale or call (trade date). Premiums and discounts are amortized or
accreted over the life of the related security as an adjustment to yield.
Dividends and interest income are recognized when earned.




- --------------------------------------------------------------------------------
                                  (Continued)


                                       28



                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS
 (Continued)

A decline in fair value of any held to maturity security below cost that is
deemed other than temporary is charged to earnings resulting in establishment of
a new cost basis for the security.

Loans Receivable: Loans that management has the intent and ability to hold for
the foreseeable future or until maturity or payoff are reported at the principal
balance outstanding, net of unearned interest, deferred loan fees and costs, and
an allowance for loan losses.

Office Properties and Equipment. Depreciation and amortization are computed
using the straight-line method at rates expected to amortize the cost of the
assets over their estimated useful lives or, with respect to leasehold
improvements, the term of the lease, if shorter. Estimated lives range from one
to forty years. Land is carried at cost.

Federal Income Taxes. The Company files a consolidated tax return with its
wholly owned subsidiaries and provides deferred federal income taxes in
recognition of temporary differences between financial statement and income tax
reporting. Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases.

Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled, and the effect on deferred
tax assets and liabilities of a change in tax rates is recognized in income in
the period that includes the enactment date.

Loan Origination and Commitment Fees. The Company defers loan origination and
commitment fees and certain direct loan origination costs and amortizes the net
amount over the lives of the related loans as a yield adjustment if the loans
are held for investment, or recognizes the net fees as mortgage banking income
when the loans are sold.

Real Estate Owned. Real estate owned is carried at the lower of cost or fair
value less estimated selling costs. If Fair values decline, a valuation
allowance is recorded through expense. Costs after acquisition are expensed.

Long-Term Assets. Office properties and equipment and other long-term assets are
reviewed for impairment when events indicate their carrying amount may not be
recoverable from future undiscounted cash flows. If impaired, the assets are
recorded at fair value.



- --------------------------------------------------------------------------------
                                   (Continued)


                                       29



                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS
 (Continued)

Statements of Cash Flows. For purposes of the consolidated statements of cash
flows, the Company considers cash and amounts due from depository institutions,
interest bearing deposits, and federal funds sold with original maturities of
less than three months to be cash equivalents. Net cash flows are reported for
NOW and passbook savings accounts, and advances from borrowers.

Stock Compensation. Employee compensation expense under stock option plans is
reported if options are granted below market price at grant date. No stock-based
compensation cost is reflected in net income, as all options granted had an
exercise price equal to or greater than the market price of the underlying stock
at the date of grant. The following table illustrates the effect on net income
and earnings per share if expense was measured using the fair value recognition
provisions of FASB Statement No. 123, Accounting for Stock-Based Compensation.



                                                    2003                2002              2001
                                                    ----                ----              ----

                                                                              
Net income as reported                        $   8,096,456          7,173,309         6,635,878
Deduct: Stock-based compensation expense      $     124,135            104,521           129,146
 determined under fair value based method     $   7,972,321          7,068,788         6,506,732
Pro forma net income

Basic earnings per share as reported          $        1.27               1.12              1.05
Pro forma basic earnings per share            $        1.25               1.11              1.03

Diluted earnings per share as reported        $        1.25               1.09              1.02
Pro forma diluted earnings per share          $        1.23               1.08              1.00



The pro forma effects are computed using option pricing models, using the
following weighted-average assumptions as of grant date.



                                      2003        2002        2001
                                      ----        ----        ----

                                                    
Risk-free interest rate               3.50%       4.73%       5.71%
Expected option life                 7 years     7 years     7 years
Expected stock price volatility      35.00%      37.00%      30.00%
Dividend yield                        2.50%       2.73%       2.00%




- --------------------------------------------------------------------------------
                                  (Continued)



                                       30


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS
 (Continued)

Earnings Per Share. Earnings per share are calculated by dividing net income for
the period by the weighted average number of shares of common stock outstanding
during the period. The assumed exercise of stock options is included in the
calculation of diluted earnings per share.

The per share data for 2003, 2002 and 2001 are adjusted to reflect the 10% stock
dividends declared July 2003, July 2002 and July 2001.

Loss Contingencies. Loss contingencies, including claims and legal actions
arising in the ordinary course of business, are recorded as liabilities when the
likelihood of loss is probable and an amount or range of loss can be reasonably
estimated. Management does not believe there now are such matters that will have
a material effect on the financial statements.

Off Balance Sheet Financial Instruments: Financial instruments include
off-balance sheet credit instruments, such as commitments to make loans issued
to meet customer financing needs. The face amount for these items represents the
exposure to loss, before considering customer collateral or ability to repay.
Such financial instruments are recorded when they are funded.

Restrictions on Cash: Cash on deposit with another institution of $1,096,000 was
required to meet regulatory reserve requirements at June 30, 2003. These
balances do not earn interest. No cash on deposit with other institution was
required to meet regulatory reserve requirements at June 30, 2002.

Fair Value of Financial Instruments. Fair values of financial instruments are
estimated using relevant market information and other assumptions, as more fully
disclosed in a separate note. Fair value estimates involve uncertainties and
matters of significant judgment regarding interest rates, credit risk,
prepayments, and other factors, especially in the absence of broad markets for
particular items. Changes in assumptions or in market conditions could
significantly affect the estimates.

Operating Segments. While the Company's chief decision-makers monitor the
revenue streams of the various Company products and services, the identifiable
segments are not material and operations are managed and financial performance
is evaluated on a Company-wide basis. Accordingly, all of the Company's
financial service operations are considered by management to be aggregated in
one reportable operating segment.

Reclassifications. Certain reclassifications have been made to the prior year
amounts to conform to the current year presentation.






- --------------------------------------------------------------------------------
                                   (Continued)


                                       31


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

NOTE  2 - SECURITIES

Securities held to maturity at June 30, 2003 and 2002, are summarized as
follows:


                                                               2003
                                                               ----
                                                      Gross             Gross
                                   Amortized       Unrealized        Unrealized        Estimated
                                      Cost            Gain              Loss           Fair Value
                                      ----            ----              ----           ----------

                                                                          
Municipal bond                    $    33,252                -                -       $    33,252
                                  -----------      -----------      -----------       -----------
    Total                         $    33,252                -                -       $    33,252
                                  ===========      ===========      ===========       ===========
Due after one year through
  five years                      $    33,252                -                -       $    33,252
                                  ===========      ===========      ===========       ===========



                                                               2002
                                                               ----
                                                       Gross            Gross
                                   Amortized        Unrealized      Unrealized        Estimated
                                      Cost             Gain             Loss          Fair Value
                                      ----             ----             ----          ----------

                                                                          
United States Government and
  agency securities               $55,000,000      $   639,100      $    (8,750)      $55,630,350
Municipal bond                        121,211                -                -           121,211
                                  -----------      -----------      -----------       -----------
    Total                         $55,121,211      $   639,100      $    (8,750)      $55,751,561
                                  ===========      ===========      ===========       ===========
Due after one year through
  five years                      $55,121,211      $   639,100      $    (8,750)      $55,751,561
                                  ===========      ===========      ===========       ===========




There were no sales of securities for the years ended June 30, 2003, 2002 or
2001. $85,000,000 of United States Agency securities were called in the year
ended June 30, 2003.


- --------------------------------------------------------------------------------
                                 (Continued)

                                       32


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

NOTE 3 - MORTGAGE-BACKED SECURITIES

Mortgage-backed securities held to maturity at June 30, 2003 and 2002, are
summarized as follows:



                                                               2003
                                                               ----
                                                       Gross            Gross
                                   Amortized        Unrealized       Unrealized       Estimated
                                      Cost             Gain             Loss          Fair Value
                                      ----             ----             ----          ----------

                                                                          
FNMA mortgage-backed securities   $    89,721      $     2,909                -       $    92,630
FHLMC mortgage-backed securities    2,840,822           98,934                -         2,939,756
Accrued interest receivable            34,255                -                -            34,255
                                  -----------      -----------      -----------       -----------
                                  $ 2,964,798      $   101,843                -       $ 3,066,641
                                  ===========      ===========      ===========       ===========





                                                              2002
                                                              ----
                                                       Gross           Gross
                                   Amortized       Unrealized        Unrealized       Estimated
                                      Cost             Gain            Loss           Fair Value
                                      ----             ----            ----           ----------
                                                                          
FNMA mortgage-backed securities   $   188,732      $     3,564                -       $   192,296
FHLMC mortgage-backed securities    7,022,569          199,969                -         7,222,538
Accrued interest receivable            85,905                -                -            85,905
                                  -----------      -----------      -----------       -----------
                                  $ 7,297,206      $   203,533                -       $ 7,500,739
                                  ===========      ===========      ===========       ===========


There were no sales of mortgage-backed securities for the years ended June 30,
2003, 2002 or 2001.


- --------------------------------------------------------------------------------
                                  (Continued)



                                       33

                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 4 - LOANS RECEIVABLE

Loans receivable at June 30, 2003 and 2002, consist of the following:



                                               2003                2002
                                               ----                ----

                                                        
Real estate mortgages:
  One-to-four family residential          $ 143,881,760       $ 158,833,656
  Home equity line of credit                 67,822,058          53,349,287
  Multifamily residential                    40,997,490          43,451,715
  Commercial                                147,560,511         133,145,924
  Commercial equity line of credit           34,080,887          22,872,121
  Land                                       62,933,365          60,124,877
  Construction - residential                111,388,555         110,596,307
  Construction - multi-family                   304,300           1,084,805
  Construction - commercial                  22,935,858          33,451,289
                                          -------------       -------------
  Total real estate mortgages               631,904,784         616,909,981
Non real estate loans                        11,760,915           8,459,413
                                          -------------       -------------
                                            643,665,699         625,369,394
Accrued interest receivable                   2,685,565           2,973,654
Deferred loan origination fees               (3,032,489)         (2,789,665)
Unearned discount                                (2,276)             (3,085)
Undisbursed portion of loan proceeds        (59,762,979)        (58,097,903)
Allowance for loan losses                    (3,882,839)         (3,901,839)
                                          -------------       -------------
                                          $ 579,670,681       $ 563,550,556
                                          =============       =============


A summary of the changes in the allowance for loan losses for the years ended
June 30, 2003, 2002, and 2001, is as follows:



                                         2003              2002              2001
                                         ----              ----              ----

                                                                
Beginning balance                    $ 3,901,839       $ 3,520,198       $ 3,387,474
Provision charged to operations                -           558,000           225,000
Charge-offs                              (19,000)         (206,078)         (112,435)
Recoveries                                     -            29,719            20,159
                                     -----------       -----------       -----------
Ending balance                       $ 3,882,839       $ 3,901,839       $ 3,520,198
                                     ===========       ===========       ===========






- --------------------------------------------------------------------------------
                                   (Continued)

                                       34


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 4 - LOANS RECEIVABLE (Continued)

The following is a summary of the principal balances of nonperforming loans at
June 30:



                                                       2003              2002
                                                       ----              ----

                                                                
Loans on nonaccrual status:
  Real estate mortgages:
    One-to-four family residential                  $3,072,917        $2,677,504
    Commercial                                       2,879,445         1,215,160
    Multi-family residential                           137,085           115,362
    Construction and land                            1,347,905         3,796,980
                                                    ----------        ----------
      Total loans on nonaccrual status               7,437,352         7,805,006
                                                    ----------        ----------
Past due loans on accrual status -
  Real estate mortgages -
    Construction and land                              275,461                 -
                                                    ----------        ----------
Total nonaccrual and past due loans                 $7,712,813        $7,805,006
                                                    ==========        ==========


During the years ended June 30, 2003, 2002 and 2001, gross interest income of
$761,798, $548,000, and $769,931, respectively, would have been recorded on
loans accounted for on a nonaccrual basis if the loans had been current
throughout the period. Nonperforming loans and impaired loans are defined
differently. Some loans may be included in both categories, whereas other loans
may only be included in one category.

At June 30, 2003 and 2002, the recorded investment in loans, which have been
identified as being impaired, totaled $12,765,000 and $13,016,000 respectively.
Included in the impaired amount at June 30, 2003 and 2002, is $1,095,934 and
$115,362, respectively, related to loans with a corresponding valuation
allowance of $234,719 and $29,719 respectively. The Company recognized no
interest on impaired loans in 2003, 2002, and 2001 (during the portion of the
respective years that they were impaired).

Average impaired loans for the years ended June 30, 2003 and 2002 amounted to
$13,296,000 and $6,983,200, respectively.










- --------------------------------------------------------------------------------
                                   (Continued)


                                       35


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 5 - MORTGAGE BANKING ACTIVITIES

Mortgage banking activities, net, including gains and losses on sales of loans,
for each of the years in the three-year period ended June 30, 2003, consist of
the following:



                                                        2003             2002               2001
                                                        ----             ----               ----

                                                                               
Mortgage loan servicing fees                        $ 1,446,168       $ 1,116,929       $   810,567
Amortization and impairment of mortgage
  servicing rights                                   (3,251,114)       (1,112,817)         (354,424)

Gross realized:
  Gains on sales of loans                             8,214,611         3,079,814         1,766,805
  Losses on sales of loans                           (1,487,596)          (98,502)       (1,133,443)
Market valuation provision for losses on loans
  receivable held for sale                                    -                 -                 -
Market valuation recoveries                                   -                 -            45,000
                                                    -----------       -----------       -----------
                                                    $ 4,922,069       $ 2,985,424       $ 1,134,505
                                                    ===========       ===========       ===========


At June 30, 2003 and 2002, the Company was servicing whole and participation
mortgage loans for others aggregating approximately $658,967,272 and
$528,319,233, respectively. The Company had $20,143,571 and $6,069,959 at June
30, 2003 and 2002, respectively, of funds collected on mortgage loans serviced
for others which is included in accrued expenses and other liabilities.

Originated mortgage servicing rights capitalized and amortized during the years
ended June 30, 2003, 2002 and 2001 were as follows:




                                    2003              2002              2001
                                    ----              ----              ----
                                                           
Beginning balance               $ 3,255,147       $ 1,284,678       $   833,558
Originated                        3,981,149         3,083,286           805,544
Amortized                        (2,581,114)       (1,112,817)         (354,424)
                                -----------       ----------        ----------
Ending balance                  $ 4,655,182       $ 3,255,147       $ 1,284,678
                                ===========       ==========        ==========


Valuation allowance
        Beginning of year       $         -       $         -       $         -
        Additions expensed          670,000       $         -                 -
        End of year             $   670,000       $         -       $         -
                                ===========       ==========        ==========




- --------------------------------------------------------------------------------
                                  (Continued)



                                       36



                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 6 - OFFICE PROPERTIES AND EQUIPMENT

Office properties and equipment at cost, less accumulated depreciation and
amortization at June 30, 2003 and 2002 are summarized as follows:



                                                         2003               2002
                                                         ----               ----

                                                                 
Land and land improvements                          $    847,500       $    847,500
Building and building improvements                     4,702,678          4,715,304
Leasehold improvements                                 4,966,034          3,793,711
Furniture and equipment                                8,436,598          6,532,717
                                                    ------------       ------------
                                                      18,952,810         15,889,232
Less accumulated depreciation and amortization        (7,396,891)        (6,071,884)
                                                    ------------       ------------
                                                    $ 11,555,919       $  9,817,348
                                                    ============       ============


NOTE 7 - DEPOSITS

Deposit balances at June 30, 2003 and 2002 are summarized by interest rate as
follows:



                                                                       2003                         2002
                                                                       ----                         ----
                                                                     Amount           %            Amount           %
                                                                     ------           -            ------           -

                                                                                                
NOW and money market accounts
                                      Noninterest bearing      $ 14,682,098        2.8%      $ 12,092,628        2.5%
                                      0.245-4.00%                66,389,265       12.6         58,813,116       12.3
                                                               ------------       ----       ------------        ----
                                                                 81,071,363       15.4         70,905,744       14.8
Passbook savings                      1.00 - 2.50%               43,191,519        8.2         37,166,435        7.7

Certificates of deposit               0.50 - 1.99%               71,825,960       13.6                  -          -
                                      2.00 - 2.99               100,173,672       19.0         91,168,895        19.0
                                      3.00 - 3.99               147,737,107       28.1        117,780,641        24.6
                                      4.00 - 4.99                53,456,947       10.2         49,071,134        10.2
                                      5.00 - 5.99                20,956,710        4.0         26,261,752         5.5
                                      6.00 - 6.99                 6,283,529        1.2         43,549,703         9.1
                                      7.00 - 7.99                 1,651,935        0.3         43,693,887         9.1
                                      8.00 - 8.99                    80,185        0.0             74,027         0.0
                                                               ------------       ----       ------------        ----
                                                                402,166,045       84.6        371,600,039        85.2
                                                               ------------       ----       ------------        ----
                                                               $526,428,927        100%      $479,672,218         100%
                                                               ============       ====       ============        ====
Weighted average rate on deposits                                                 2.61%                          3.76%
                                                                                  ====                           ====




- --------------------------------------------------------------------------------
                                  (Continued)


                                       37


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 7 - DEPOSITS (Continued)




                                           2003                           2002
                                           ----                           ----
                                         Amount            %            Amount            %
                                         ------            -            ------            -

                                                                          
Remaining term to maturity
  of certificates of deposit:

   12 months or less               $249,316,121        62.0%      $254,171,324        68.4%
   13 to 24 months                  115,880,269        28.8         77,333,220        20.8
   25 to 36 months                   13,613,069         3.4         24,414,990         6.6
   37 to 48 months                   23,356,586         5.8         15,680,505         4.2
                                   ------------         ---       ------------         ---
                                   $402,166,045         100%      $371,600,039         100%
                                   ============         ===       ============         ===
Weighted average rate on
  certificates of deposit                              3.23%                          4.57%
                                                       ====                           ====


Time deposits in amounts of $100,000 or more totaled approximately $109,893,000
and $105,828,000 at June 30, 2003 and 2002, respectively.

Interest expense on deposits is summarized as follows:



                                  2003             2002             2001
                                  ----             ----             ----

                                                      
NOW accounts                 $   899,621      $ 1,079,276      $ 1,292,321
Passbook accounts                470,504          660,260          771,793
Certificates of deposit       13,799,377       19,255,467       25,015,617
                             -----------      -----------      -----------
                             $15,169,502      $20,995,003      $27,079,731
                             ===========      ===========      ===========


NOTE 8 - ADVANCES FROM THE FEDERAL HOME LOAN BANK OF CINCINNATI

Advances from the Federal Home Loan Bank of Cincinnati (FHLB), with maturities
and interest rates thereon at June 30, 2003 and 2002, were as follows:



Maturity                                  Interest Rate        2003               2002
- --------                                  -------------        ----               ----

                                                                    
February 2003                                  6.00      $           -       $    500,000
February 2006                                  6.05            123,220            239,695
February 2008                                  5.37         10,000,000         10,000,000
March 2008                                     5.64         10,000,000         10,000,000
March 2011                                     3.94         50,000,000         50,000,000
May 2011                                       4.16         50,000,000         50,000,000
                                                          ------------       ------------
                                                          $120,123,220       $120,739,695
                                                          ============       ============
Weighted average interest rate                                    4.29%              4.30%
                                                                  ====               ====



- --------------------------------------------------------------------------------
                                  (Continued)


                                       38


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 8 - ADVANCES FROM THE FEDERAL HOME LOAN BANK OF CINCINNATI (Continued)

Each of the advances, except the advance maturing in February 2006, is a
convertible fixed-rate advance. Each of these is convertible at the option of
the FHLB to LIBOR. Alternatively, if the conversion option is exercised, the
Bank could repay these advances without prepayment penalty.

In order to secure these advances, the Bank has pledged mortgage loans with
unpaid principal balances aggregating approximately $113,341,000 and
$150,925,000 at June 30, 2003 and 2002, respectively, plus Federal Home Loan
Bank stock. In addition, at June 30, 2003, $21,000,000 in overnight cash and
stock in the FHLB was pledged for such advances.

NOTE 9 - NOTES PAYABLE

On July 26, 2000, the Company secured a $5 million line of credit from another
federally insured institution at a variable interest rate that adjusts to LIBOR
plus 200 basis points. Each draw is separately negotiated with respect to rate
and term. The outstanding balance at June 30, 2003 and June 30, 2002 was
$2,500,000 and $4,900,000, respectively. The line was extended in July 2003 for
an additional year and can be extended indefinitely. The line is secured by all
of the Company's stock in the Bank.

On March 8, 2002, one of the Company's subsidiaries obtained a $3.4 million term
loan from another federally insured institution to refinance the Company's Solon
headquarters building. The note carries a variable interest rate that adjusts to
LIBOR plus 230 basis points. The loan matures on March 15, 2007. The loan is
guaranteed by the Company.

Principal repayments on the note are scheduled as follows:

             
                           2004               $78,900
                           2005                85,470
                           2006                92,520
                           2007             3,058,260
                                           ----------

                                           $3,315,150
                                           ==========

                           







- --------------------------------------------------------------------------------
                                  (Continued)


                                       39


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 10 - FEDERAL INCOME TAXES

The provision for federal income taxes differs from the amounts computed by
applying the U.S. federal income tax statutory rate to income before federal
income taxes. These differences are reconciled as follows:



                                                  2003                          2002                            2001
                                                  ----                          ----                            ----
                                        Amount            %            Amount            %            Amount            %
                                        ------            -            ------            -            ------            -

                                                                                                    
Computed expected tax                 $4,277,077        35.0%        $3,783,018        35.0%        $3,500,410        35.0%
Decrease in tax resulting from:
  Benefit of graduated rates            (100,000)       (1.0)          (100,000)       (1.0)          (100,000)       (1.0)
  Tax credits                           (111,646)       (0.9)          (111,646)       (1.0)          (111,646)       (1.1)
  Other, net                              58,333         0.6             63,941         0.6             76,528         0.8
                                      ----------        ----         ----------        ----         ----------        ----

                                      $4,123,764        33.7%        $3,635,313        33.6%        $3,365,292        33.7%
                                      ==========        ====         ==========        ====         ==========        ====



The net tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and liabilities at June 30, 2003 and 2002
are:



                                                   2003              2002
                                                   ----              ----
                                                           
Deferred tax assets:
  Loan loss and other reserves                 $ 1,294,629       $ 1,345,883
  Deferred Compensation                            426,964           428,385
  Unrealized gains on loans held for sale          364,130            91,637
  Other                                             36,909            25,737
                                               -----------       -----------
    Total gross deferred tax assets              2,122,632         1,891,642
Deferred tax liabilities:
  Deferred loan fees, net                          358,953           309,847
  FHLB stock dividend                            1,187,603         1,034,365
  Originated mortgage servicing asset            1,354,962         1,106,750
  Fixed assets                                     728,809           798,412
  Other                                            187,666           193,413
                                               -----------       -----------
    Total gross deferred tax liabilities         3,817,993         3,442,787
                                               -----------       -----------
    Net deferred tax liability                 $(1,695,361)      $(1,551,145)
                                               ===========       ===========



A valuation allowance is established to reduce the deferred tax asset if it is
more likely than not that the related tax benefits will not be realized. In
management's opinion, it is more likely than not that the tax benefits will be
realized; consequently, no valuation allowance has been established as of June
30, 2003 or 2002.


- --------------------------------------------------------------------------------
                                   (Continued)


                                       40



                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 10 - FEDERAL INCOME TAXES (continued)

Retained earnings at June 30, 2003 include approximately $4,516,000 for which no
provision for federal income tax has been made. This amount represents
allocations of income during years prior to 1988 to bad debt deductions for tax
purposes only. These qualifying and nonqualifying base year reserves and
supplemental reserves will be recaptured into income in the event of certain
distributions and redemptions. Such recapture would create income for tax
purposes only, which would be subject to the then current corporate income tax
rate. Recapture would not occur upon the reorganization, merger, or acquisition
of the Bank, nor if the Bank is merged or liquidated tax-free into a bank or
undergoes a charter change. If the Bank fails to qualify as a bank or merges
into a nonbank entity, these reserves will be recaptured into income.

The favorable reserve method previously afforded to thrifts was repealed for tax
years beginning after December 31, 1995. Large thrifts were required to switch
to the specific charge-off method of section 166. In general, a thrift is
required to recapture the amount of its qualifying and nonqualifying reserves in
excess of its qualifying and nonqualifying base year reserves. The Bank has no
such excess reserves to recapture.

NOTE 11 - LEASES

The Company leases certain premises from unaffiliated parties. Future minimum
payments under noncancelable operating leases with initial or remaining terms of
one year or more consisted of the following at June 30, 2003:
Year Ending June 30,

                                         
     2004                                   $  581,014
     2005                                      464,491
     2006                                      374,602
     2007                                      374,602
     2008                                      338,874
     Thereafter                                702,739
                                            ----------
     Total minimum lease payments           $2,836,322
                                            ==========




During the years ended June 30, 2003, 2002, and 2001, rental expense was
$647,596, $555,030, and $809,169, respectively.






- --------------------------------------------------------------------------------
                                  (Continued)



                                       41



                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 12 - COMMITMENTS AND CONTINGENCIES

In the normal course of business, the Bank enters into commitments with
off-balance sheet risk to meet the financing needs of its customers. Commitments
to extend credit involve elements of credit risk and interest rate risk in
excess of the amount recognized in the consolidated statements of financial
condition. The Bank's exposure to credit loss in the event of nonperformance by
the other party to the commitment is represented by the contractual amount of
the commitment. The Bank uses the same credit policies in making commitments as
it does for on-balance sheet instruments. Interest rate risk on commitments to
extend credit results from the possibility that interest rates may have moved
unfavorably from the position of the Bank since the time the commitment was
made.

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 of 60 to 120 days or other termination
clauses and may require payment of a fee. Since some of the commitments may
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 of collateral obtained by the Bank upon extension of credit is based on
management's credit evaluation of the applicant. Collateral held is generally
residential and commercial real estate.

The Bank's lending is concentrated in Northeastern Ohio, and as a result, the
economic conditions and market for real estate in Northeastern Ohio could have a
significant impact on the Bank.

At June 30, 2003 and 2002, the Bank had the following commitments:



                                                                   2003             2002
                                                                   ----             ----

                                                                           
Commitments to sell mortgage loans in the secondary market      $89,630,300      $25,733,000
Commitments to fund variable mortgage loans                      12,669,150       14,173,479
Commitments to fund fixed mortgage loans                         66,782,101       30,247,388


The fixed rate loan commitments have interest rates ranging from 3.75% to
7.125%.

There are pending against the Company various lawsuits and claims which arise in
the normal course of business. In the opinion of management, any liabilities
that may result from pending lawsuits and claims will not materially affect the
financial position of the Company.


                                 (Continued)
- --------------------------------------------------------------------------------


                                       42


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 13 - REGULATORY CAPITAL

The Company 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
Company's financial statements. Under capital adequacy guidelines and the
regulatory framework for prompt corrective action, the Company must meet
specific capital guidelines that involve quantitative measures of the Company's
assets, liabilities, and certain off-balance-sheet items as calculated under
regulatory accounting practices. The Company's capital amounts and
classification are also subject to qualitative judgments by the regulators about
components, risk weightings, and other factors.

Office of Thrift Supervision (OTS) regulations requires savings institutions to
maintain certain minimum levels of regulatory capital. An institution that fails
to comply with its regulatory capital requirements must obtain OTS approval of a
capital plan and can be subject to a capital directive and certain restrictions
on its operations. At June 30, 2003, the minimum regulatory capital regulations
require institutions to have equity capital to total tangible assets of 1.5%; a
minimum leverage ratio of core (Tier 1) capital to total adjusted tangible
assets of 4.0%; and a minimum ratio of total capital to risk weighted assets of
8.0%. At June 30, 2003, the Bank exceeded all of the aforementioned regulatory
capital requirements.

Regulations limit capital distributions by savings institutions. Generally,
capital distributions are limited to undistributed net income for the current
and prior two years. At June 30, 2003, these limitations are not expected to
prevent the company from paying its normal cash dividends.

The most recent notification from the Office of Thrift Supervision categorized
the Company as well capitalized under the regulatory framework for prompt
corrective action. To be categorized as well capitalized the Company must
maintain minimum total risk-based, Tier 1 risk-based, and Tier 1 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.












- --------------------------------------------------------------------------------
                                   (Continued)

                                       43


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 13 - REGULATORY CAPITAL (Continued)

At June 30, 2003 and 2002, the Bank was in compliance with regulatory capital
requirements as set forth below (dollars in thousands):



                                                              Core/          Tier-1          Total
                                              Equity        Leverage       Risk-Based      Risk-Based
                                              Capital        Capital         Capital         Capital
                                              -------        -------         -------         -------
                                                                               
June 30, 2003:
  GAAP capital                            $    57,656         57,656          57,656          57,656
  Nonallowable component                            -           (108)           (108)           (108)
  General loan valuation allowances                 -              -               -           3,648
                                              -------        -------         -------         -------
    Regulatory capital                         57,656         57,548          57,548          61,196
  Total assets                                744,105        744,105         744,105         744,105
  Adjusted total assets                             -        743,997               -               -
  Risk-weighted assets                              -              -         535,618         535,618
  Actual capital ratio                           7.75%          7.73%          10.74%          11.43%
  Regulatory requirement for capital
    adequacy purposes                            1.50%          4.00%                           8.00%
  Regulatory capital category -
    well-capitalized -
      equal to or greater than                                  5.00%           6.00%          10.00%



                                               Core/         Tier-1           Total
                                              Equity        Leverage       Risk-Based      Risk-Based
                                              Capital        Capital         Capital         Capital
                                              -------        -------         -------         -------
                                                                               
June 30, 2002:
  GAAP capital                            $    53,553         53,553          53,553          53,553
  Nonallowable component                            -           (159)           (159)           (159)
  General loan valuation allowances                 -              -               -           3,872
                                              -------        -------         -------         -------
    Regulatory capital                         53,553         53,394          53,394          57,266
  Total assets                                677,517        677,517         677,517         677,517
  Adjusted total assets                             -        677,358               -               -
  Risk-weighted assets                              -              -         492,378         492,378
  Actual capital ratio                           7.90%          7.88%          10.84%          11.63%
  Regulatory requirement for capital
    adequacy purposes                            1.50%          4.00%                           8.00%
  Regulatory capital category -
    well-capitalized -
      equal to or greater than                                  5.00%           6.00%          10.00%



- --------------------------------------------------------------------------------
                                   (Continued)


                                       44

                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 14 - RELATED PARTY TRANSACTIONS

Loans to principal officers, directors, and their affiliates in 2003 were as
follows.

                                 
                Beginning balance                   $ 4,467,000
                New Loans                             3,110,000
                Repayments                           (1,803,000)
                                                    -----------
                Ending balance                      $ 5,774,000
                                                    ===========

                

NOTE 15 - STOCK OPTIONS

The Bank offered stock options to the directors and officers of the bank under a
1992 plan, a 1996 plan, and a 2000 plan.

All of the options authorized under the 1992 have been granted and exercised.
The options granted under the 1996 plan are exercisable over a ten-year period,
with a vesting period ranging from zero to five years as stated in the
individual option agreements. The options granted under the 2000 plan are
exercisable over a ten-year period and can be exercised at any time.

Options were granted at fair market value and, accordingly, no charges were
reflected in compensation and benefits expense due to the granting of stock
options. The excess of the option price over the par value of the shares
purchased through the exercise of stock options is credited to additional paid
in capital.

A summary of the activity in the plan is as follows:



                                                  2003                       2002                        2001
                                                  ----                       ----                        ----
                                                 Average                    Average                     Average

                                                         Option                     Option                    Option
                                           Shares        Price         Shares       Price        Shares        Price
                                           -------       ------       -------       ------      -------       ------

                                                                                            
Outstanding beginning of year              385,799       $ 8.27       553,029       $ 4.90      490,936       $ 4.21
Exercised                                  (66,095)        5.51      (239,588)        1.95      (27,683)        1.38
Expired                                     (5,018)        9.72             -            -            -            -
Granted                                     53,240        10.31        72,358         8.96       89,776         7.87
                                           -------       ------       -------       ------      -------       ------
Outstanding end of year                    367,926       $ 8.38       385,799       $ 8.27      553,029       $ 4.90
                                           =======       ======       =======       ======      =======       ======
Exercisable end of year                    264,622       $ 7.99       227,775       $ 7.67      444,109       $ 4.12
                                           =======       ======       =======       ======      =======       ======

Weighted average fair value
  of options granted during the year                     $ 3.55                   $   3.68                    $ 3.43



- --------------------------------------------------------------------------------
                                  (Continued)

                                       45




                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 15 - STOCK OPTIONS (Continued)

Options outstanding at June 30, 2003 were as follows:




                       Outstanding            Exercisable
                       -----------            -----------
                           Weighted Average            Weighted
Range of                      Remaining                Average
Exercise                     Contractual               Exercise
Price                Number     Life        Number      Price
- ---------------     ----------------       ------------------
                                          
$5.63 - $7.37       110,943     5.03       110,650    $  6.66
$7.38 - $9.19       176,771     6.11       107,160       8.35
$9.39 - $11.26       80,212     7.65        46,812      10.31
                    ----------------       ------------------
Total               367,926     6.12       264,622    $  7.99
                    ================       ==================





NOTE 16 - EARNINGS PER SHARE

The following is a reconciliation of basic earnings per share to diluted
earnings per share for the years ended June 30:



                                                                             2003
                                                                             ----
                                                                                         Per-Share
                                                          Net Income        Shares         Amount
                                                          ----------        ------         ------

                                                                                 
Basic EPS:
Income available to common shareholders                   $8,096,456       6,368,231      $   1.27
Dilute effects of assumed exercises of stock options               -         100,648           .02
                                                          ----------       ---------      --------
Diluted EPS:
Income available to common shareholders                   $8,096,456       6,468,879      $   1.25
                                                          ==========       =========      ========



                                                                             2002
                                                                             ----
                                                                                         Per-Share
                                                          Net Income        Shares         Amount
                                                          ----------        ------         ------

                                                                                 
Basic EPS:
Income available to common shareholders                   $7,173,309       6,376,256      $   1.12
Dilute effects of assumed exercises of stock options               -         166,480          0.03
                                                          ----------       ---------      --------
Diluted EPS:
Income available to common shareholders                   $7,173,309       6,542,736      $   1.09
                                                          ==========       =========      ========





- --------------------------------------------------------------------------------
                                 (Continued)



                                       46


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 16 - EARNINGS PER SHARE (Continued)



                                                                             2001
                                                                             ----
                                                                                          Per-Share
                                                          Net Income        Shares          Amount
                                                          ----------        ------          ------

                                                                                 
Basic EPS
Income available to common shareholders                   $6,635,878       6,309,752      $   1.05
Dilute effects of assumed exercises of stock options               -         214,213          0.03
                                                          ----------       ---------      --------
Diluted EPS
Income available to common shareholders                   $6,635,878       6,523,965      $   1.02
                                                          ==========       =========      ========



No options were anti-dilutive for the years ended June 30, 2003, 2002, or 2001
as the market price in all cases was greater than the exercise price.

NOTE 17 - FAIR VALUE OF FINANCIAL INSTRUMENTS

The estimated fair value amounts have been determined by the Bank using
available market information and appropriate valuation methodologies. However,
considerable judgment is necessarily required to interpret market data to
develop the estimates of fair value. Accordingly, the estimates presented herein
are not necessarily indicative of the amounts the Bank could realize in a
current market exchange. The use of different market assumptions and/or
estimation methodologies may have a material effect on the estimated fair value
amounts.



                                                        June 30, 2003              June 30, 2002
                                                        -------------              -------------
                                                   Carrying      Estimated      Carrying     Estimated
                                                    Amount       Fair Value      Amount      Fair Value
                                                    ------       ----------     --------     ----------
                                                                       (in thousands)
                                                                                 
Assets:
  Cash and amounts due from depository
    institutions                                   $  9,755         9,755         4,527         4,527
  Interest-bearing deposits                           3,946         3,946         1,737         1,737
  Federal funds sold                                 83,050        83,050         8,050         8,050
  Securities held to maturity                            33            33        55,121        55,752
  Mortgage-backed securities held to maturity         2,965         3,032         7,297         7,501
Loans receivable held for:
  Investment, net                                   579,671       596,515       563,551       597,488
  Sale, net                                          33,604        34,380        11,680        11,940
Federal Home Loan Bank stock                         10,396        10,396         9,948         9,948



- --------------------------------------------------------------------------------
                                  (Continued)

                                       47


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 17 - FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)



                                                  June 30, 2003                    June 30, 2002
                                                  -------------                    -------------
                                             Carrying       Estimated        Carrying       Estimated
                                              Amount        Fair Value        Amount        Fair Value
                                            ---------       ----------       ---------      ----------
                                                                             (in thousands)

                                                                                
Liabilities:
  Demand deposits and passbook savings      $(124,263)       (124,263)       (108,072)       (108,072)
  Time deposits                              (402,166)       (410,934)       (371,600)       (376,534)
  Advances from the Federal Home Loan
   Bank of Cincinnati                        (120,123)       (131,958)       (120,740)       (125,206)
  Notes payable                                (5,815)         (5,815)         (8,288)         (8,288)



Cash and amounts due from depository institutions, interest bearing deposits,
and federal funds sold. The carrying amount is a reasonable estimate of fair
value because of the short maturity of these instruments.

Securities and mortgage-backed securities. Estimated fair value for securities
and mortgage-backed securities is based on quoted market prices.

Loans receivable held for investment and held for sale. For loans receivable
held for sale, fair value is estimated using the quoted market prices for
securities backed by similar loans, adjusted for differences in loan
characteristics. For performing loans receivable held for investment, fair value
is estimated by discounting contractual cash flows adjusted for prepayment
estimates using discount rates based on secondary market sources adjusted to
reflect differences in servicing and credit costs. For other loans, cash flows
and maturities are estimated based on contractual interest rates and historical
experience and are discounted using secondary market rates adjusted for
differences in servicing and credit costs.

Fair value for significant nonperforming loans is based on recent external
appraisals. If appraisals are not available, estimated cash flows are discounted
using a rate commensurate with the risk associated with the estimated cash
flows. Assumptions regarding credit risk, cash flows, and discount rates are
judgmentally determined using available market information and specific borrower
information.

Federal Home Loan Bank stock. This item is valued at cost, which represents
redemption value and approximates fair value.




- --------------------------------------------------------------------------------
                                   (Continued)


                                       48


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 17 - FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)

Demand deposits and time deposits. The fair value of demand deposits, savings
accounts, and certain money market deposits is the amount payable on demand at
the reporting date. The fair value of fixed-maturity certificates of deposit is
estimated using discounted cash flows and rates currently offered for deposits
of similar remaining maturities.

Advances from the Federal Home Loan Bank of Cincinnati. The fair value of the
Bank's FHLB debt is estimated based on the current rates offered to the Bank for
debt of the same remaining maturities.

Notes payable. The carrying value of the Company's variable rate note payable is
a reasonable estimate of fair value based on the current incremental borrowing
rate for similar types of borrowing arrangements.

Off-balance sheet instruments. The fair value of commitments is estimated using
the fees currently charged to enter similar agreements, taking into account the
remaining terms of the agreements and the counterparties' credit standing. For
fixed-rate loan commitments, fair value also considers the difference between
current levels of interest rates and the committed rates. The fair value of
undisbursed lines of credit is based on fees currently charged for similar
agreements or on estimated cost to terminate them or otherwise settle the
obligations with the counterparties at the reporting date. The carrying amount
and fair value of off-balance sheet instruments is not significant as of June
30, 2003 and 2002.

NOTE 18 - PARENT COMPANY

The following are condensed statements of financial condition as of June 30,
2003 and 2002 and related condensed statements of operations and cash flows for
the years ended June 30, 2003, 2002 and 2001 for PVF Capital Corp.

CONDENSED STATEMENTS OF FINANCIAL CONDITION
- -------------------------------------------



                                                           2003             2002
                                                           ----             ----

                                                                  
Cash and amounts due from depository institutions      $    19,459      $   106,598
Prepaid expenses and other assets                        1,422,778        1,701,403
Investment in subsidiaries                              59,802,552       55,409,326
                                                       -----------      -----------
    Total assets                                       $61,244,789      $57,217,327
                                                       ===========      ===========
Accrued expenses and other liabilities                 $   141,653      $    18,749
Note payable                                             2,500,000        4,900,000
Stockholders' equity                                    58,603,136       52,298,578
                                                       -----------      -----------
    Total liabilities and stockholders' equity         $61,244,789      $57,217,327
                                                       ===========      ===========


- --------------------------------------------------------------------------------
                                   (Continued)


                                       49


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 18 - PARENT COMPANY (Continued)

CONDENSED STATEMENTS OF OPERATIONS
- ----------------------------------


C
                                                           2003            2002            2001
                                                           ----            ----            ----

                                                                               
 Income:
  Mortgage banking activities                           $   88,602      $  142,140      $  213,171
  Dividends from subsidiaries                            3,950,000       1,545,000         350,000
  Other, net                                                     -               -               -
                                                        ----------      ----------      ----------
                                                         4,038,602       1,687,140         563,171
                                                        ----------      ----------      ----------
Expenses:
  Interest expense                                         137,483         276,418         304,688
  General and administrative                               284,890         214,296         184,532
                                                        ----------      ----------      ----------
                                                           422,373         490,714         489,220
                                                        ----------      ----------      ----------
  (Loss) income before federal income taxes and
    equity in undistributed net income of
    subsidiaries                                         3,616,229       1,196,426          73,951
Federal income tax benefit                                 112,615         116,951          93,856
                                                        ----------      ----------      ----------
  (Loss) income before equity in undistributed
    net income of subsidiaries                           3,728,844       1,313,377         167,807
Equity in undistributed net income of subsidiaries       4,367,612       5,859,932       6,468,071
                                                        ----------      ----------      ----------
    Net income                                          $8,096,456      $7,173,309      $6,635,878
                                                        ==========      ==========      ==========



CONDENSED STATEMENTS OF CASH FLOWS
- ----------------------------------




                                                           2003            2002             2001
                                                           ----            ----             ----

                                                                               
Operating activities:
  Net income                                            $8,096,456      $7,173,309      $6,635,878
  Equity in undistributed net income of subsidiaries    (4,367,612)     (5,859,932)     (6,468,071)
  Repayment of advance from subsidiary                     440,000       1,615,873      10,175,000
  Other, net                                               (38,471)        (33,581)     (6,890,112)
                                                        ----------      ----------      ----------
    Net cash provided by (used in) operating
     activities                                          4,130,373       2,895,669       3,452,695
                                                        ----------      ----------      ----------
Investing activities:
  Investment in Parkview Federal Savings Bank                    -               -        (500,000)
                                                        ----------      ----------      ----------
  Net cash used in investing activities                          -               -        (500,000)
                                                        ----------      ----------      ----------



- --------------------------------------------------------------------------------
                                   (Continued)



                                       50


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 18 - PARENT COMPANY (Continued)

                                                                                       
Financing activities:
  Repayment on note payable                                 (2,400,000)       (3,050,000)       (1,400,000)
  Proceeds from note payable                                         -         3,250,000                 -
  Proceeds from exercise of stock options                      162,307           142,377            38,405
  Cash paid in lieu of fractional shares                             -                 -                 -
  Dividends paid                                            (1,654,844)       (1,536,424)       (1,378,774)
  Purchase of Treasury stock                                  (324,975)       (1,639,602)         (189,437)
                                                           -----------       -----------       -----------
  Net cash provided by (used in) financing activities       (4,217,512)       (2,833,649)       (2,929,806)
                                                           -----------       -----------       -----------
    Net increase (decrease) in cash and
      cash equivalents                                         (87,139)           62,020            22,889
Cash and cash equivalents at beginning of year                 106,598            44,578            21,689
                                                           -----------       -----------       -----------
Cash and cash equivalents at end of year                   $    19,459       $   106,598       $    44,578
                                                           ===========       ===========       ===========




NOTE 19 -EMPLOYEE BENEFIT PLANS

401(k) Savings Plan: Employees who have reached age 18 and have completed one
year of eligibility service are eligible to participate in the Company's 401(k)
Savings Plan. The plan allows eligible employees to contribute up to 15% of
their compensation with the Company matching up to 50% of the first 4%
contributed by the employee, as determined by the Company for the contribution
period. The plan also permits the Company to make a profit sharing contribution
at its discretion up to 4% of the employee's compensation. Participants vest in
the Company's contributions ratably over six years.

The total of the Company's matching and profit sharing contribution cost related
to the plan for the years ended June 30, 2003, 2002, and 2001 was $104,094,
$89,966, and $83,255, respectively.

Supplemental Executive Retirement Plan: During fiscal year 2000, the Company
established a Supplemental Executive Retirement Plan (SERP) to provide
additional retirement benefits to participating executive officers. The SERP was
adopted in order to provide benefits to such executives whose benefits are
reduced under the Company's tax-qualified benefit plans pursuant to limitations
under the Internal Revenue Code. The SERP is subject to certain vesting
provisions, and provides that the executives shall receive a supplemental
retirement benefit if the executive's employment is terminated after reaching
the normal retirement. For the year ended June 30, 2003, 2002, and 2001, the
Company recognized expense under the SERP of $401,400, $223,800, and $201,000,
respectively.


- --------------------------------------------------------------------------------
                                  (Continued)



                                       51


                       PVF CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    Years ended June 30, 2003, 2002 and 2001

- --------------------------------------------------------------------------------
NOTE 20 - SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

The following is a summary of the unaudited consolidated quarterly results of
operations for 2003 and 2002 (in thousands of dollars, except per share
data):(1)



                                      Quarters For the Year Ended June 30, 2003
                                    ----------------------------------------------
                                     First       Second        Third        Fourth
                                     -----       ------        -----        ------

                                                                
Interest income                     $11,404      11,299       10,415        10,364
Interest expense                      5,825       5,317        4,740         4,764
                                    -------      ------       ------         -----
  Net interest income                 5,579       5,982        5,675         5,600
Provision for losses on loans             0           0            0             0
Noninterest income                      750       1,838        1,597         1,708
Noninterest expense                   3,801       4,412        4,114         4,181
                                    -------      ------       ------         -----
  Income before taxes                 2,528       3,408        3,158         3,127
Federal income taxes                    840       1,151        1,064         1,069
                                    -------      ------       ------         -----
  Net income                        $ 1,688       2,257        2,094         2,058
                                    =======      ======       ======         =====
Basic earnings per share(2)         $  0.26        0.35         0.33          0.33
                                    =======      ======       ======         =====
Diluted earnings per share(2)       $  0.25        0.35         0.32          0.32
                                    =======      ======       ======         =====



                                      Quarters For the Year Ended June 30, 2002
                                    ----------------------------------------------
                                     First      Second         Third        Fourth
                                    -------     ------         -----        ------

                                                                
Interest income                     $12,889      12,715       11,611        11,599
Interest expense                      7,884       7,005        6,231         5,940
                                    -------       -----        -----         -----
  Net interest income                 5,005       5,710        5,380         5,659
Provision for losses on loans           125         228           50           155
Noninterest income                      781       1,070          870         1,030
Noninterest expense                   3,159       3,732        3,548         3,700
                                    -------       -----        -----         -----
  Income before taxes                 2,502       2,820        2,652         2,834
Federal income taxes                    832         977          889           938
                                    -------       -----        -----         -----
  Net income                        $ 1,671       1,843        1,763         1,896
                                    =======       =====        =====         =====
Basic earnings per share(2)         $  0.26        0.29         0.27          0.30
                                    =======       =====        =====         =====
Diluted earnings per share(2)       $  0.25        0.28         0.26          0.29
                                    =======       =====        =====         =====


(1)  The total of the four quarterly amounts may not equal the full year amount
     due to rounding.

(2)  After giving effect to a 10% stock dividend, declared on July 25, 2002 and
     issued on August 30, 2002 and a 10% stock dividend, declared on June 24,
     2003 and issued on August 29, 2003.

- --------------------------------------------------------------------------------


                                       52


[PVF CAPITAL CORP. LOGO]
- --------------------------------------------------------------------------------



Board of Directors                                  General Information
    Board of Directors                                  General Information
- ----------------------                                  ------------------------

                                                     
JOHN R. MALE                                            INDEPENDENT
Chairman of the Board and                               CERTIFIED ACCOUNTANTS
Chief Executive Officer                                 Crowe, Chizek and Company LLP
                                                        Landerbrook Corporate Center One
C. KEITH SWANEY                                         5900 Landerbrook Drive
President, Chief Operating Officer                      Suite 205
and Treasurer                                           Cleveland, Ohio 44124

GERALD A. FALLON                                        GENERAL COUNSEL
Retired                                                 Moriarty & Jaros, P.L.L.
                                                        30195 Chagrin Boulevard
ROBERT K. HEALEY                                        Suite 110 North
Retired                                                 Pepper Pike, Ohio 44124

RONALD D. HOLMAN, II                                    TRANSFER AGENT AND REGISTRAR
Partner                                                 National City Bank, Dept. 5352
Cavitch, Familo, Durkin & Frutkin                       Corporate Trust Operations
                                                        P.O. Box 92301
STANLEY T. JAROS                                        Cleveland, Ohio 44193-0900
Partner
Moriarty & Jaros, P.L.L.                                SPECIAL COUNSEL
                                                        Stradley Ronon Stevens & Young, LLP
RAYMOND J. NEGRELLI                                     1220 19th Street, N.W., Suite 600
President                                               Washington, D.C. 20036
Raymond J. Negrelli, Inc.
                                                        STOCK LISTING
STUART D. NEIDUS                                        NASDAQ Small-Cap Market
Chairman and                                            Symbol: PVFC
Chief Executive Officer
Anthony & Sylvan Pools Corporation                      ANNUAL MEETING
                                                        The 2003 Annual Meeting of Stockholders
                                                        will be held on October 20, 2003 at 10:00 a.m.
                                                        at the Company's Corporate Center,
Executive Officers                                      30000 Aurora Road, Solon, Ohio.
        Executive Officers
- --------------------------                              ANNUAL REPORT ON FORM 10-K
                                                        A copy of the Company's Annual Report on
                                                        Form 10-K for the fiscal year ended
                                                        June 30, 2003 as filed with the Securities
JOHN R. MALE                                            and Exchange Commission will be furnished
Chairman of the Board and                               without charge to stockholders upon written
Chief Executive Officer                                 request to the Corporate Secretary,
                                                        PVF Capital Corp., 30000 Aurora
C. KEITH SWANEY                                         Road, Solon, Ohio 44139.
President, Chief Operating Officer
and Treasurer

JEFFREY N. MALE
Vice President and Secretary
































                            [PVF CAPITAL CORP. LOGO]
                               CORPORATE CENTER
                               30000 Aurora Road
                                Solon, OH 44139
                                  440-248-7171
                             www.parkviewfederal.com

EX-21

                                                                      Exhibit 21


                         SUBSIDIARIES OF THE REGISTRANT


Parent

PVF Capital Corp.



                                         STATE OR OTHER
                                         JURISDICTION OF          PERCENTAGE
SUBSIDIARIES (1)                         INCORPORATION            OWNERSHIP
- ----------------                         -------------            ---------

Park View Federal Savings Bank                U.S.                   100%

PVF Service Corporation                       Ohio                   100%

PVF Mortgage Corp.                            Ohio                   100%

PVF Community Development Corp.               Ohio                   100%

Mid Pines Land Co.                            Ohio                   100%

PVF Holdings Inc.                             Ohio                   100%


- ------------
(1)  The assets, liabilities and operations of the subsidiaries are included in
     the consolidated financial statements contained in the Annual Report to
     Stockholders attached hereto as Exhibit 13.

EX-23.1

                                                                    Exhibit 23.1










                       CONSENT OF INDEPENDENT ACCOUNTANTS



The Board of Directors
PVF Capital Corp.:


We consent to the incorporation by reference in the Registration Statements No.
33-97450, No. 33-86116, No. 333-48446, and 333-14601 on Form S-8 of PVF Capital
Corp. of our report dated July 27, 2001, relating to the consolidated statements
of operations, stockholders' equity, and cash flows of PVF Capital Corp. and
subsidiaries for the year ended June 30, 2001, which report appears in the June
30, 2003 Annual Report on Form 10-K of PVF Capital Corp.



                                  /s/ KPMG LLP


Cleveland, Ohio
September 25, 2003

EX-23.2

                                                                    Exhibit 23.2



                       CONSENT OF INDEPENDENT ACCOUNTANTS



We consent to incorporation by reference in the registration statements (No.
33-97450, No. 33-86116, 333-14601 and No. 333-48446) on Form S-8 of PVF Capital
Corp. of our report dated August 1, 2003, relating to the consolidated statement
of financial condition of PVF Capital Corp. and subsidiaries as of June 30, 2003
and 2002, and the related consolidated statements of operations, stockholders'
equity, and cash flows for the years ended June 30, 2003 and 2002, which report
appears in the June 30, 2003 Annual Report on Form 10-K of PVF Capital Corp.



                                            /s/ Crowe, Chizek and Company, LLC

                                            Crowe, Chizek and Company, LLC


Cleveland, Ohio
September 29, 2003

EX-31.1

                                                                    Exhibit 31.1


                                  CERTIFICATION

I, John R. Male, Chairman of the Board and Chief Executive Officer of PVF
Capital Corp., certify that:

     1.   I have reviewed this annual report on Form 10-K of PVF Capital Corp.;

     2.   Based on my knowledge, this report does not contain any untrue
          statement of a material fact or omit to state a material fact
          necessary to make the statements made, in light of the circumstances
          under which such statements were made, not misleading with respect to
          the period covered by this report;

     3.   Based on my knowledge, the financial statements, and other financial
          information included in this report, fairly present in all material
          respects the financial condition, results of operations and cash flows
          of the registrant as of, and for, the periods presented in this
          report;

     4.   The registrant's other certifying officer(s) and I are responsible for
          establishing and maintaining disclosure controls and procedures (as
          defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
          registrant and have:

               (a) Designed such disclosure controls and procedures, or caused
          such disclosure controls and procedures to be designed under our
          supervision, to ensure that material information relating to the
          registrant, including its consolidated subsidiaries, is made known to
          us by others within those entities, particularly during the period in
          which this report is being prepared;

               (b) Evaluated the effectiveness of the registrant's disclosure
          controls and procedures and presented in this report our conclusions
          about the effectiveness of the disclosure controls and procedures, as
          of the end of the period covered by this report based on such
          evaluation; and

               (c) Disclosed in this report any change in the registrant's
          internal control over financial reporting that occurred during the
          registrant's fourth fiscal quarter that has materially affected, or is
          reasonably likely to materially affect, the registrant's internal
          control over financial reporting; and

     5.   The registrant's other certifying officer(s) and I have disclosed,
          based on our most recent evaluation of internal control over financial
          reporting, to the registrant's auditors and the audit committee of the
          registrant's board of directors (or persons performing the equivalent
          functions);

               (a) All significant deficiencies and material weaknesses in the
          design or operation of internal control over financial reporting which
          are reasonably likely to adversely affect the registrant's ability to
          record, process, summarize and report financial information; and

               (b) Any fraud, whether or not material, that involves management
          or other employees who have a significant role in the registrant's
          internal control over financial reporting.


Date: September 23, 2003

                                         /s/ John R. Male
                                         ---------------------------------------
                                         John R. Male
                                         Chairman of the Board and
                                         Chief Executive Officer
                                         (Principal Executive Officer)

EX-31.2

                                                                    Exhibit 31.2


                                  CERTIFICATION

I, C. Keith Swaney, President and Chief Operating Officer of PVF Capital Corp.,
certify that:

     1.   I have reviewed this annual report on Form 10-K of PVF Capital Corp.;

     2.   Based on my knowledge, this report does not contain any untrue
          statement of a material fact or omit to state a material fact
          necessary to make the statements made, in light of the circumstances
          under which such statements were made, not misleading with respect to
          the period covered by this report;

     3.   Based on my knowledge, the financial statements, and other financial
          information included in this report, fairly present in all material
          respects the financial condition, results of operations and cash flows
          of the registrant as of, and for, the periods presented in this
          report;

     4.   The registrant's other certifying officer(s) and I are responsible for
          establishing and maintaining disclosure controls and procedures (as
          defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
          registrant and have:

               (a) Designed such disclosure controls and procedures, or caused
          such disclosure controls and procedures to be designed under our
          supervision, to ensure that material information relating to the
          registrant, including its consolidated subsidiaries, is made known to
          us by others within those entities, particularly during the period in
          which this report is being prepared;

               (b) Evaluated the effectiveness of the registrant's disclosure
          controls and procedures and presented in this report our conclusions
          about the effectiveness of the disclosure controls and procedures, as
          of the end of the period covered by this report based on such
          evaluation; and

               (c) Disclosed in this report any change in the registrant's
          internal control over financial reporting that occurred during the
          registrant's fourth fiscal quarter that has materially affected, or is
          reasonably likely to materially affect, the registrant's internal
          control over financial reporting; and

     5.   The registrant's other certifying officer(s) and I have disclosed,
          based on our most recent evaluation of internal control over financial
          reporting, to the registrant's auditors and the audit committee of the
          registrant's board of directors (or persons performing the equivalent
          functions);

               (a) All significant deficiencies and material weaknesses in the
          design or operation of internal control over financial reporting which
          are reasonably likely to adversely affect the registrant's ability to
          record, process, summarize and report financial information; and

               (b) Any fraud, whether or not material, that involves management
          or other employees who have a significant role in the registrant's
          internal control over financial reporting.


Date: September 23, 2003

                                        /s/ C. Keith Swaney
                                        ----------------------------------------
                                        C. Keith Swaney
                                        President and Chief Operating Officer
                                        (Principal Financial Officer)

EX-32

                                                                      Exhibit 32




                CERTIFICATION PURSUANT TO 18. U.S.C. SECTION 1350
                    AS ADOPTED PURSUANT TO SECTION 906 OF THE
                           SARBANES-OXLEY ACT OF 2002


     The undersigned executive officers of the Registrant hereby certify that
this Annual Report on Form 10-K for the year ended June 30, 2003 (the "Report")
fully complies with the requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, and the information contained in the Report fairly
presents, in all material respects, the financial condition and results of
operations of the Registrant.



                                       By:      /s/ John R. Male
                                           -------------------------------------
                                           Name: John R. Male
                                           Title: Chairman of the Board and
                                           Chief Executive Officer



                                       By:      /s/ C. Keith Swaney
                                           -------------------------------------
                                           Name: C. Keith Swaney
                                           Title: President and Chief Financial
                                           Officer


Date: September 23, 2003