10-Q

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION
	Item 1 Financial Statements
	Item 2 Management’s Discussion and Analysis of Financial Condition and Results of Operations
	Item 3 Quantitative and Qualitative Disclosures about Market Risk
PART II OTHER INFORMATION
	Item 6 Exhibits and Reports on Form 8-K
SIGNATURE

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20552

FORM 10-Q

[X]	Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended September 30, 1999.
[   ]	Transition 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)

United States	34-1659805
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
25350 Rockside Road, Bedford Heights, Ohio	44146
(Address of principal executive offices)	(Zip Code)

(440) 439-2200

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report.)

     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 the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock, $0.01 Par Value	4,389,742
(Class)	(Outstanding at October 29, 1999)

PVF CAPITAL CORP.

INDEX

			Page
Part I	Financial Information
	Item 1	Financial Statements
		Consolidated Statements of Financial Condition, September  30, 1999 and June 30, 1999 (unaudited)		1
		Consolidated Statements of Operations for the three months ended September 30, 1999 and 1998 (unaudited)		2
		Consolidated Statements of Cash Flows for the three months ended September 30, 1999 and 1998 (unaudited)		3
		Notes to Consolidated Financial Statements (unaudited)		4
	Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations		5
	Item 3	Quantitative and Qualitative Disclosures about Market Risk		8
Part II	Other Information			8

PART I   FINANCIAL INFORMATION

Item 1  Financial Statements

PVF CAPITAL CORP.

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Unaudited)

			September 30,			June 30,
			1999			1999
ASSETS
Cash and cash equivalents:
	Cash and amounts due from depository institutions		$	3,752,135		$	4,140,460
	Interest bearing deposits			350,739			573,872
	Federal funds sold			3,550,000			5,375,000
		Total cash and cash equivalents		7,652,874			10,089,332
Securities held to maturity, at cost				25,316,743			25,334,041
Loans receivable, net				412,763,002			395,550,737
Loans receivable held for sale, net				4,984,229			1,772,176
Mortgage-backed securities held to maturity, net				1,537,731			1,732,726
Office properties and equipment, net				1,940,392			2,003,211
Real estate owned, net				44,734			168,500
Real estate held for investment				3,796,852			3,796,852
Investment required by law
	Stock in the Federal Home Loan Bank of Cincinnati			4,116,594			3,759,452
Prepaid expenses and other assets				3,850,134			4,994,438
		Total Assets	$	466,003,285		$	449,201,465
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities
	Deposits		$	334,003,796		$	331,241,736
	Advances from the Federal Home Loan Bank of Cincinnati			81,024,389			66,040,736
	Advances from borrowers for taxes and insurance			3,335,782			5,463,660
	Accrued expenses and other liabilities			7,552,899			7,599,525
		Total Liabilities		425,916,866			410,345,657
Stockholders’ Equity
	Serial preferred stock, none issued			—			—
	Common stock, $0.01 par value, 15,000,000 shares authorized; 4,389,742 issued and outstanding			43,897			43,897
	Paid in capital			20,247,827			20,247,827
	Retained earnings-substantially restricted			19,865,945			18,635,334
	Treasury Stock, at cost 5,000 shares			(71,250	)		(71,250	)
		Total Stockholders’ Equity		40,086,419			38,855,808
		Total Liabilities and Stockholders’ Equity	$	466,003,285		$	449,201,465

See accompanying notes to consolidated financial statements

1

PVF CAPITAL CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

			Three Months Ended
			September 30,
			1999		1998
Interest income
	Loans		$	8,568,436	$	8,267,357
	Mortgage-backed securities			26,359		44,492
	Cash and investment securities			517,459		626,088
		Total interest income		9,112,254		8,937,937
Interest expense
	Deposits			3,868,624		4,438,975
	Borrowings			1,031,043		726,254
		Total interest expense		4,899,667		5,165,229
		Net interest income		4,212,587		3,772,708
Provision for loan losses				350,000		0
		Net interest income after provision for loan losses		3,862,587		3,772,708
Noninterest income, net
	Service and other fees			138,957		103,162
	Mortgage banking activities, net			104,337		238,701
	Insurance proceeds			692,143		0
	Other, net			80,252		21,658
		Total noninterest income, net		1,015,689		363,521
Noninterest expense
	Compensation and benefits			1,381,120		1,193,461
	Office, occupancy, and equipment			469,675		428,839
	Other			700,077		618,529
		Total noninterest expense		2,550,872		2,240,829
		Income before federal income tax provision		2,327,404		1,895,400
Federal income tax provision				775,417		632,000
		Net income	$	1,551,987	$	1,263,400
Basic earnings per share			$	0.35	$	0.29
Diluted earnings per share			$	0.34	$	0.28

See accompanying notes to consolidated financial statements

2

PVF CAPITAL CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

				Three Months Ended
				September 30,
				1999			1998
Operating Activities
	Net Income			$	1,551,987		$	1,263,400
	Adjustments to reconcile net income to net cash used in operating activities
		Accretion of discount on marketable securities			17,298			0
		Depreciation and amortization			148,974			149,830
		Provision for losses on loans			350,000			0
		Accretion of unearned discount and deferred loan origination fees, net			(308,016	)		(272,225	)
		(Gain) loss on loans available for sale, net			755			(129,881	)
		Gain on disposal of real estate owned, net			(505	)		(1,514	)
		Change in accrued interest on investments, loans, and borrowings, net			(64,591	)		(8,868	)
		Change in other assets and other liabilities, net			(1,153,460	)		(3,766,880	)
		Change in loans receivable held for sale, net			(3,212,810	)		94,119
			Net cash used in operating activities		(2,670,368	)		(2,672,019	)
Investing Activities
		Loan and mortgage-backed securities repayments and originations, net			(16,773,072	)		(9,370,457	)
		Disposals of real estate owned			123,766			209,080
		Securities purchases			0			(433,000	)
		Securities maturities			0			9,800,000
		FHLB stock dividend, net			(357,142	)		(64,061	)
		Additions to office properties and equipment, net			(86,155	)		(37,262	)
			Net cash provided by (used in) investing activities		(17,092,603	)		104,300
Financing activities
		Net increase (decrease) in demand deposits, NOW, and passbook savings			2,092,874			(655,295	)
		Net increase (decrease) in time deposits			571,361			(8,800,763	)
		Net increase in FHLB advances			14,983,653			4,978,982
		Repayment of notes payable			0			(1,060,000	)
		Cash dividend paid			(321,375	)		(939	)
			Net cash provided by (used in) financing activities		17,326,513			(5,538,015	)
Net decrease in cash and cash equivalents					(2,436,458	)		(8,105,734	)
Cash and cash equivalents at beginning of period					10,089,332			23,216,962
Cash and cash equivalents at end of period				$	7,652,874		$	15,111,228
Supplemental disclosures of cash flow information:
		Cash payments of interest expense		$	4,801,843		$	5,160,487
		Cash payments of income taxes		$	0		$	0

See accompanying notes to consolidated financial statements

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PVF CAPITAL CORP.

Notes to Consolidated Financial Statements

September 30, 1999 and 1998

(Unaudited)

      1.  The accompanying consolidated interim financial statements were prepared in accordance with regulations of the Securities and Exchange Commission for Form 10-Q. All information in the consolidated interim financial statements is unaudited except for the June 30, 1999 consolidated statement of financial condition which was derived from the Corporation’s audited financial statements. Certain information required for a complete presentation in accordance with generally accepted accounting principles has been condensed or omitted. However, in the opinion of management, these interim financial statements contain all adjustments, consisting only of normal recurring accruals, necessary to fairly present the interim financial information. The results of operations for the three months ended September 30, 1999 are not necessarily indicative of the results to be expected for the entire year ending June 30, 2000. PVF Capital Corp.’s common stock is traded on the NASDAQ SMALL-CAP ISSUES under the symbol PVFC.

      2.  Recently Issued Accounting Standards

      SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities” was issued in June 1998 and amended by SFAS No. 137 which deferred the effective date to fiscal years beginning after June 15, 2000. This statement establishes comprehensive accounting and reporting requirements for derivative instruments and hedging activities. This statement requires entities to recognize all derivatives as either assets or liabilities, with the instruments measured at fair value. The accounting for gains and losses resulting from changes in fair value of the derivative instrument depends on the use of the derivative and the type of risk being hedged. At the present time, the Bank is analyzing the effect of the adoption of SFAS No. 133 on the Bank’s consolidated financial statements.

      SFAS No. 134, “Accounting for Mortgage-Backed Securities Retained after Securitization of Mortgage Loans Held for Sale by a Mortgage Banking Enterprise” was issued in October 1998 and is effective for the first fiscal quarter beginning after December 15, 1998. This statement amends SFAS No. 65 to require that after the securitization of mortgage loans held for sale, an entity engaged in mortgage banking activities must classify the resulting mortgage-backed securities or other retained interests based on its ability and intent to sell or hold those investments. After the securitization of a mortgage loan held for sale, any retained mortgage-backed securities shall be classified in accordance with the provisions of SFAS No. 115. However, a mortgage banking enterprise must classify as trading any retained mortgage-backed securities that it commits to sell before or after the securitization process. The Bank has not historically securitized mortgage loans and retained the mortgage-backed security. Therefore, the adoption did not have any impact on the Company’s consolidated financial statements.

      3.  The following table discloses Earnings Per Share for the three months ended September 30, 1999 and September 30, 1998.

		Three months ended September 30,
		1999						1998
		Income		Shares		Per-Share		Income		Shares		Per-Share
		(Numerator)		(Denominator)		Amount		(Numerator)		(Denominator)		Amount
Basic EPS
	Income available to common stockholders	$	1,551,987		4,389,742	$	0.35	$	1,263,400		4,389,742	$	0.29
Effect of Stock Options					170,149		0.01				174,285		0.01
Diluted EPS
	Income available to common stockholders	$	1,551,987		4,559,891	$	0.34	$	1,263,400		4,564,027	$	0.28

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Item 2  Management’s Discussion and Analysis of Financial Condition and Results of Operations

      The following analysis discusses changes in financial condition and results of operations at and for the three-month period ended September 30, 1999 for PVF Capital Corp. (“PVF” or the “Company”), Park View Federal Savings Bank (the “Bank”), its principal and wholly-owned subsidiary, PVF Service Corporation, a wholly-owned real estate subsidiary, and PVF Holdings, Inc., a wholly-owned and currently inactive subsidiary.

  Forward-Looking Statements

      When used in this Form 10-Q, 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, competition that could cause actual results to differ materially from historical earnings and those presently anticipated or projected and Year 2000 issues. 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 results 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.

Financial Condition

      Consolidated assets of PVF were $466.0 million as of September 30, 1999, an increase of approximately $16.8 million or 3.7% as compared to June 30, 1999. The Bank remained in regulatory capital compliance for tangible, core, and risk-based capital on a fully phased-in basis with capital levels of 7.60%, 7.60% and 10.62% respectively at September 30, 1999.

      During the three months ended September 30, 1999, the Company’s cash and cash equivalents, which consist of cash, interest-bearing deposits and federal funds sold, decreased $2.4 million or 24.1% as compared to June 30, 1999. The change in the Company’s cash and cash equivalents consisted of a decrease in cash and interest-bearing deposits of $0.6 million and a decrease in federal funds sold of $1.8 million. The net $20.2 million, or 5.1%, increase in loans receivable and mortgage-backed securities during the three months ended September 30, 1999, resulted from an increase in loans receivable of $20.4 million and a decrease in mortgage-backed securities of $0.2 million. The increase of $20.4 million in loans receivable included increases of $10.0 million in single family loans, $10.3 million in construction loans, $0.9 million in home equity loans, $1.0 million in multi-family loans, and $1.7 million in installment loans, and a decrease of $2.5 million in commercial real estate loans and $1.0 million in land loans. The decrease in mortgage-backed securities was the result of payments received of $0.2 million. The growth of the loan portfolio was as anticipated and resulted in no material change to the composition of the portfolio.

      Prepaid expenses and other assets decreased by $1.1 million as a result of adjustments made to N.O.W. Clearing accounts. The decrease of $123,800 in real estate owned (“REO”) is attributable to the disposal of developed building lots. Investment in stock with the Federal Home Loan Bank of Cincinnati increased by $357,100, or 9.5%, due to the purchase of $287,800 in additional stock and stock dividends paid.

      During the three months ended September 30, 1999, management’s decision to take advantage of attractive borrowing rates from the Federal Home Loan Bank of Cincinnati, and match market savings rates to retain deposits, resulted in an increase of $15.0 million, or 22.7%, in advances and an increase of $2.8 million, or 0.8%, in deposits. The decrease in advances from borrowers for taxes and insurance of $2.1 million, or 39.0%, is due to timing differences between the collection and payment of escrow funds.

5

      The increase in Federal Home Loan Bank advances of $15.0 million, and deposits of $2.8 million, along with a reduction in cash and cash equivalents of $2.4 million and prepaid expenses and other assets of $1.1 million, and an increase in retained earnings of $1.2 million were used to fund the net increase in loans receivable and mortgage-backed securities of $20.2 million and the reduction in advances from borrowers for taxes and insurance of $2.1 million.

Results of Operations

  Three months ended September 30, 1999 compared to the three months ended September 30, 1998

      PVF’s net income is dependent primarily on its net interest income, which is the difference between interest earned on its loans and investments and interest paid on interest-bearing liabilities. Net interest income also includes amortization of loan origination fees, net of origination costs.

      PVF’s net income is also affected by the generation of non-interest income, which primarily consists of loan servicing income, service fees on deposit accounts, and gains on the sale of loans and mortgage-backed securities available for sale. Net interest income is determined by (i) the difference between yields earned on interest-earning assets and rates paid on interest-bearing liabilities (“interest-rate spread”) and (ii) the relative amounts of interest-earning assets and interest-bearing liabilities. The Company’s interest-rate spread is affected by regulatory, economic and competitive factors that influence interest rates, loan demand and deposit flows. In addition, net income is affected by the level of operating expenses and loan loss provisions.

      The Company’s net income for the three months ended September 30, 1999 was $1,552,000. This represents a $288,600, or 22.8%, increase when compared with the prior year comparable period.

      Net interest income for the three months ended September 30, 1999 increased by $439,900, or 11.7%, as compared to the prior year comparable period, due to an increase of $174,300, or 2.0%, in interest income that resulted from an increase of $28.5 million in the average balance of the loan and mortgage-backed securities portfolios and a decrease in the average balance of the investment portfolio of $6.3 million. The increased average balance of interest-earning assets was partially offset by a 27 basis point decrease in the return on interest-earning assets from the prior year comparable period. The average balance on deposits decreased by $6.5 million while the average balance on advances increased by $26.1 million from the prior year comparable period. The increased average balance of interest-bearing liabilities was partially offset by a 51 basis point decrease in the average cost of funds for the current period and resulted in an overall decrease in interest expense of $265,600, or 5.1%. The Company’s net interest income increased due to an increase of 24 basis points in the Company’s interest-rate spread during the current period as compared to the prior year comparable period and balance sheet growth in both interest-earning assets and interest-bearing liabilities.

      For the three months ended September 30, 1999 a $350,000 provision for loan losses was recorded, while no provision for loan losses was recorded in the prior year comparable period. The Company uses a systematic approach to determine the adequacy of its loan loss allowance and the necessary provision for loan losses. The loan portfolio is reviewed and delinquent loan accounts are analyzed individually on a monthly basis, with respect to payment history, ability to repay, probability of repayment, and loan-to-value percentage. Consideration is given to the types of loans in the portfolio and the overall risk inherent in the portfolio. After reviewing current economic conditions, changes to the size and composition of the loan portfolio, changes in delinquency status, levels of non-accruing loans, non-performing assets, impaired loans, and actual loan losses incurred by the Company, 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. Management believes it uses the best information available to make a determination as to the adequacy of the allowance for loan losses.

      During the three months ended September 30, 1999, the Company experienced an increase in the level of impaired loans and classified assets of $1.3 million and $1.2 million, respectively. Due to the increase in impaired loans and classified assets as well as growth in the loan portfolio of $20.4 million, management determined it was necessary and prudent to record a provision for loan losses of $350,000 in the current period. For the three months ended September 30, 1998, the Company experienced an increase in the levels of impaired loans and

6

classified assets of $130,000 and $3.1 million, respectively. Despite the increase in impaired loans and classified assets and growth in the loan portfolio of $10.2 million it was not determined to be necessary to record a provision for loan losses due to lower anticipated and actual net charge-offs in the period. At September 30, 1999, the allowance for loan losses was $2.9 million, which represented 60.0% of nonperforming loans and 0.7% of net loans.

      For the three months ended September 30, 1999, noninterest income increased by $652,200, or 179.4%, from the prior year comparable period. This was primarily the result of an increase of $750,700 in other noninterest income, net from the prior year comparable period, which resulted primarily from the receipt of an insurance payment of $692,000 for costs previously incurred relating to the settlement of a lawsuit and the associated legal expenses by PVF Holdings, Inc., a wholly owned subsidiary of PVF Capital Corp. In addition, rental income increased by $78,900 in the current period. Service and other fees increased by $35,800, or 34.7% from the prior year comparable period, primarily due to increases in NOW account fee income. A decrease of $134,300, or 56.3%, in income from mortgage-banking activities resulted primarily from a decrease in profit on loan sales in the current period. During these periods, PVF pursued a strategy of originating long-term, fixed-rate loans pursuant to Federal Home Loan Mortgage Corporation (“FHLMC”) and Federal National Mortgage Association (“FNMA”) guidelines and selling such loans to the FHLMC or the FNMA, while retaining the servicing.

      Noninterest expense for the three months ended September 30, 1999 increased by $310,000, or 13.8%, from the prior year comparable period. This was primarily the result of a $187,700, or 15.7%, increase in compensation and benefits attributable to increased staffing, employee 401(k) benefits, incentive bonuses paid, and salary and wage adjustments. In addition, office, occupancy and equipment increased by $40,800, or 9.5%, due to increases in office rent and additional expenses incurred due to the relocation of one of our current branch offices and the opening of a new branch office. Other noninterest expense increased by $81,500, or 13.2%, primarily due to an increase in legal expenses of $65,000, and an increase in advertising of $30,000 in the current period. The increase in legal expenses is the result of costs incurred in defending lawsuits filed against the Bank and two other entities, PVF Financial Planning Inc. and Emissary Financial Group, Inc., which are majority-owned subsidiaries of the Company’s wholly owned subsidiary, PVF Holdings, Inc. Information pertaining to these lawsuits is set forth in Item 3 of Form 10-K for the year ended June 30, 1999. There have been no significant changes to these lawsuits for the three month period ended September 30, 1999.

      The federal income tax provision for both the three month periods ended September 30, 1999 and September 30, 1998 was at an effective rate of 33.3%.

Year 2000

      Park View Federal realizes the challenges of the Year 2000 (Y2K) issue and, in compliance with federal regulators, has assembled a project team to assess and remediate any deficient system in use within the Bank. A formal plan, approved by the Board of Directors, called for the inventory of all internal systems and third-party relationships to determine the impact on Bank operations. Following this assessment, correction, testing, validation and installation of affected systems was completed without any complications. These systems are currently in production within the organization and have been operating successfully.

      As part of the effort to assure continued inter-operability with third-party relationships, the Bank was an active participant in the Mortgage Bankers Association Y2K readiness testing program. This program established specific guidelines and standards for testing information exchange between financial organizations. The Bank successfully completed all required testing and did additional testing to assure readiness in this area.

      Rapid and accurate data processing is essential to Company operations. If testing reveals that any system critical to continued business operation should fail, all internal and external resources available will be directed toward correcting these systems. System delays, mistakes, or failures could have an adverse impact on the Company. In addition, non-compliance by third parties (including loan customers) and disruptions to the economy in general resulting from Year 2000 issues could also have a negative impact.

7

      As part of its Y2K readiness efforts, the Bank has initiated a customer awareness program to educate and inform its customers of Y2K issues and progress made in resolving these issues. The Bank has developed a Y2K business resumption contingency plan for all mission critical systems that augments its existing disaster recovery plan.

      The cost for the Bank to become Year 2000 ready is not anticipated to be material to the Bank’s net income for any year. The Board of Directors and the Bank staff are making every effort to ensure that the Bank will continue to deliver financial services to its customers.

Liquidity and Capital Resources

      The Bank is required by federal regulations to maintain specific levels of “liquid” assets consisting of cash and other eligible investments. The current level of liquidity required by the Office of Thrift Supervision is 4% of the sum of net withdrawable savings and borrowings due within one year. The Bank’s liquidity at September 30, 1999 was 9.0%. Management believes the Bank has sufficient liquidity to meet its operational needs.

Item 3  Quantitative and Qualitative Disclosures about Market Risk

      There have been no significant changes to the Company’s interest rate risk position or any changes to how the Company manages its Asset/ Liability position since June 30, 1999.

PART II   OTHER INFORMATION

Item 6  Exhibits and Reports on Form 8-K

      (a)  The following exhibits to this Quarterly Report on Form 10-Q are filed herewith:

Exhibit No.	Description
10.3	Form of Amended Severance Agreements by and among PVF Capital Corp., Park View Federal Savings Bank and each of John R. Male, C. Keith Swaney and Jeffrey N. Male

      (b)  PVF did not file any reports on Form 8-K during the quarter ended September 30, 1999.

8

SIGNATURE

       Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant had duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

PVF Capital Corp.
_______________________________________
(Registrant)

Date: November 10, 1999	/s/ C. KEITH SWANEY
	C. Keith Swaney Vice President and Treasurer

9 EX-10.3 2 EXHIBIT 10.3 1 EXHIBIT NO. 10.3 - FORM OF SEVERANCE AGREEMENT --------------------------- SEVERANCE AGREEMENT This AGREEMENT is made and entered into this 26th day of October, 1999, by and among PVF Capital Corporation (the "Corporation"), a corporation organized under the laws of the State of Ohio, Park View Federal Savings Bank (the "Bank"), an OTS-chartered, FDIC-insured savings association with its main office located in Cleveland, Ohio and (the "Executive"). Any reference to the "Board of Directors" herein shall mean the Board of Directors of the Corporation or the Bank or a committee serving at the pleasure of the Board of Directors of the Bank. Any reference to "FDIC" herein shall mean the Federal Deposit Insurance Corporation. Any reference to "OTS" shall mean the Office of Thrift Supervision. WHEREAS, the Executive serves as an employee of the Bank; WHEREAS, the Corporation, the Bank and the Executive are parties to a Severance Agreement dated July 1, 1998; and WHEREAS, the parties hereto desire that this Agreement supersede and replace in its entirety the July 1, 1998 Severance Agreement; NOW THEREFORE, in consideration of the performance of the responsibilities of the Executive and upon the other terms and conditions hereinafter provided, the parties hereto agree as follows: 1. NO EMPLOYMENT CONTRACT The parties hereto acknowledge and agree that this Agreement is not a management or employment agreement and that nothing in this Agreement shall give the Executive any rights or impose any obligations to continued employment by the Bank or Corporation or any subsidiary or successor of the Bank or Corporation, nor shall it give the Bank or Corporation any rights or impose any obligations for the continued performance of duties by the Executive for the Bank or Corporation or any subsidiary or successor of the Bank or Corporation. 2 2. TERM OF AGREEMENT The initial term of this Agreement shall be for a period of three (3) years commencing November 1st, 1999 (hereafter referred to as the "Anniversary Date"). Commencing on the first Anniversary Date of this Agreement, and continuing at each Anniversary Date thereafter, the Agreement shall automatically renew for one (1) additional year beyond the then effective expiration date only upon a determination and resolution of the Board of Directors that the performance of the Executive has met the requirements and standards of the Board and that such term shall be extended. If the Board of Directors determines not to extend the term, it shall promptly so notify the Executive, with such election by the Board not to extend the term not to otherwise affect the then effective term of this Agreement. Reference herein to the term of this Agreement shall refer both to such initial term and such extended terms. Unless sooner terminated as set forth herein, this contract shall terminate when the Executive reaches age sixty-five (65). 3. TERMINATION FOR CAUSE If the Corporation or Bank terminates the Executive's employment for cause (as defined below), all of the Bank's and Corporation's obligations hereunder shall immediately terminate as of the termination date. As used herein, "for cause" shall mean (i) gross misconduct by the Executive that is materially inconsistent with the terms hereof, or (ii) material failure by the Executive to perform his duties, either of which continues after written notice thereof and a fifteen (15) day chance to cure or (iii) the Executive's conviction for committing a felony. 4. VOLUNTARY TERMINATION OF AGREEMENT This Agreement may be terminated by the Executive at any time upon ninety (90) days' written notice to either the Bank or the Corporation or upon such shorter period as may be agreed upon between the Executive and the Board of Directors. 2 3 5. GOVERNMENTAL TERMINATION OF AGREEMENT (a) If the Executive is removed from office and/or permanently prohibited from participating in the conduct of the Bank's or the Corporation's affairs by an order issued under Section 8(e) of the Federal Deposit Insurance Act, 12 U.S.C. sec. 1818(e), all obligations of the Bank and the Corporation under this Agreement shall terminate, as of the effective date of the order. (b) If the Bank is in default (as defined in Section 3(x)(1) of the Federal Deposit Insurance Act), all obligations under this Agreement shall terminate. (c) All obligations under this Agreement shall be terminated, except to the extent determined that continuation of the contract is necessary for the continued operation of the Bank, by the Director of the OTS or his or her designee at the time the FDIC enters into an agreement to provide assistance to or on behalf of the Bank under the authority contained in Section 13(c) of the Federal Deposit Insurance Act, or by the Director of the OTS or his or her designee at the time the Director of the OTS or his or her designee approves a supervisory merger to resolve problems related to the operation of the Bank or when the Bank is determined by the Director of the OTS to be in an unsafe or unsound condition. Any rights of the parties that have already vested, however, shall not be affected by such action. (d) If the Executive is suspended and/or temporarily prohibited from participating in the conduct of the Bank's affairs by a notice served under Section 8 (e)(3) or (g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. sec. 1818(e)(3) or (g)(1), the Corporation's and the Bank's obligations under subparagraphs 6(a), (b) and (c) of this Agreement shall be suspended as the date of service, unless stayed by appropriate proceedings. (e) If the charges in the notice referenced in subparagraph 5(d) are dismissed, the Board of Directors may in its discretion: 3 4 (i) pay the Executive all or part of the severance benefits while the Corporation's and the Bank's contract obligations were suspended, and (ii) reinstate (in whole or in part) any of the Corporation's and the Bank's obligations which were suspended as required in subparagraph (d) above. 6. SEVERANCE PAYMENTS OR TERMINATION BENEFITS For purpose of this Agreement, the severance payments and termination benefits specified in this Paragraph 6 shall be payable to the Executive subsequent to the occurrence of one of the following events: (i) Involuntary termination of the Executive's employment with the Bank or Corporation with or within one (1) year after a Change in Control, other than for Cause or pursuant to Paragraphs 4 or 5 of this Agreement. For purposes of this section, Change in Control shall have the same meaning as such term is defined in Paragraph 8, and Cause shall have the same meaning as such term is defined in Paragraph 3. (ii) Voluntary or involuntary termination for Good Reason, as defined in Paragraph 7, and other than for Cause or pursuant to Paragraphs 4 or 5 of this Agreement. (a) Upon the Executive's termination as a result of one of the events specified in this Paragraph 6, the Bank or Corporation shall pay to Executive, or in the event of his subsequent death, his beneficiary or beneficiaries, or his estate as the case may be, as severance pay or liquidated damages, or both, a sum equal to two times the Executive's annual compensation. For purposes of this Paragraph, compensation shall be defined as the Executive's then current base salary, plus annual incentive compensation for the calendar year immediately preceding the year in which the above-mentioned event occurs. Such payment shall be paid to the Executive in a lump sum within thirty (30) days of the Executive's date of termination. The amount payable to the Executive hereunder shall not be reduced to account for the time value of money or discounted to present value. (b) Upon the Executive's termination as a result of one of the events specified in this Paragraph 6, the Bank or Corporation shall cause the Executive to become fully vested in any qualified and/or 4 5 nonqualified plans, programs or arrangements in which the Executive participated, notwithstanding any provisions contained in the respective Agreement of the plan, program or arrangement. The Bank shall also contribute to the Executive's 401(k) Plan Account the Bank's matching and/or profit sharing which would have been paid had the Executive remained in the employ of the Bank throughout the remainder of the 401(k) Plan year. (c) Upon the Executive's termination as a result of one of the events specified in this Paragraph 6, the Corporation or Bank will cause to be continued life, health and disability insurance coverage substantially identical to the coverage maintained by the Bank or the Corporation for the Executive prior to his severance. Such coverage shall cease upon the earlier of Executive's employment by another employer or twelve (12) months from such termination. Upon the expiration of the twelve (12) month period, Executive shall have the option of continuing health insurance coverage at his/her own expense for a period not less than the number of months by which the Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation period exceeds twelve (12) months. (d) The Executive shall not be required to mitigate the amount of any payment required hereunder by seeking other employment or otherwise nor shall the amount paid hereunder be reduced or offset by any compensation earned or received by the Executive as a result of employment with another employer or self-employment. The amount paid hereunder shall not be reduced by any other plan, program, policy or arrangement of the Bank or Corporation. Benefits provided under Paragraph 6(c) shall be reduced to the extent comparable benefits are actually received by the Executive from or through another employer. 7. GOOD REASON For purposes of this Agreement, "Good Reason" means the occurrence of any of the events or conditions described in subparagraphs (a) through (f) hereof without the Executive's express written 5 6 consent; provided the Executive's right to terminate his employment pursuant to this Paragraph 7 shall not be affected by his incapacity due to physical or mental illness. (a) A change in the Executive's status, title, position or responsibilities (including reporting responsibilities) which, in the Executive's reasonable judgment, does not represent a promotion from his status, title, position or responsibilities as in effect immediately prior thereto; the assignment to the Executive of any duties or responsibilities which, in the Executive's reasonable judgment, are inconsistent with such status, title, position or responsibilities; or any removal of the Executive from or failure to reappoint him to any of such positions, except in connection with the termination of his employment for (i) Cause, (ii) pursuant to Paragraphs 4 or 5, (iii) by the Executive other than for Good Reason; (b) A material reduction by the Bank or the Corporation in the Executive's base salary; (c) The relocation of Executive's principal place of employment to a location that is more than thirty-five (35) miles from the location where Executive was principally employed immediately prior to such relocation or the Bank's or the Corporation's requiring the Executive to be based at any place other than the location where the Executive was based immediately prior to such change, except for reasonably required travel (as determined by the Board of Directors) on the Bank's or the Corporation's business; (d) The failure by the Bank or the Corporation to continue to provide the Executive with benefits substantially similar to those provided to him under any of the employee benefit plans in which the Executive becomes a participant, or the taking of any action by the Bank or the Corporation which would directly or indirectly materially reduce any of such benefits or deprive the Executive of any material fringe benefit enjoyed by him; (e) Death prior to retirement. If the Executive dies while actively employed by the Bank or Corporation prior to retirement; or (f) Disability prior to retirement. If the Executive becomes totally disabled while actively employed by the Bank or Corporation prior to retirement. For purposes of this agreement, the term "totally disabled" means that because of injury or sickness, the Executive is unable to perform his duties. 8. CHANCE IN CONTROL (a) If there is a Change in Control of the Bank or Corporation during the term of this Agreement, the Executive shall be entitled to severance payments and/or termination benefits as described in Paragraph 6 if the Executive's employment with the Bank or the Corporation is involuntarily terminated in connection 6 7 with or within one (1) year after the Change in Control, other than for Cause or pursuant to Paragraphs 4 or 5. This payment shall also be made in the case of the Executive's voluntary termination of employment for Good Reason (as defined in Paragraph 7) in connection with or within one (1) year after a Change in Control of the Bank or Corporation. Such voluntary termination of employment for Good Reason in connection with or within one (1) year after a Change in Control of the Bank or Corporation shall not constitute a termination for Cause or a voluntary termination subject to Paragraph 4 of this Agreement. (b) For purposes of this Agreement, "Change in Control of the Bank or Corporation" means: (i) 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 Corporation's voting securities; (ii) the acquisition by a person of the power to direct the Bank's or Corporation'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 Corporation for the purposes of the Savings & Loan Holding Company Act or the Change in Bank Control Act and the regulations thereunder; (iii) during any period of two (2) consecutive years during the term of this Agreement, individuals who at the beginning of such period constitute the Board of Directors of the Bank or the Corporation 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; (iv) the Corporation shall have merged into or consolidated with another corporation, or merged another corporation into the Corporation, on a basis whereby less than fifty percent (50%) of the total voting power of the surviving corporation is represented by shares held by former shareholders of the Corporation prior to such merger or consolidation; or (v) the Corporation shall have sold to another person (i) substantially all of the Corporation'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. 7 8 9. WITHHOLDING OF TAXES The Bank or Corporation may withhold from any benefits payable under this Agreement all Federal, state, city or other taxes as may be required pursuant to any law, governmental regulation or ruling. 10. PAYMENT OF LEGAL AND/OR ACCOUNTING FEES Reasonable legal and/or accounting fees and expenses paid or incurred by the Executive pursuant to any dispute or question of interpretation relating to the Agreement shall be paid or reimbursed by the Corporation in accordance with the following: (a) If the Executive, the Bank or the Corporation initiates a proceeding and the Executive prevails, all reasonable legal and/or accounting fees and expenses shall be paid by the Corporation. (b) If the Executive initiates a proceeding and does not prevail on his claim, then the Corporation shall reimburse the Executive for all legal and/or accounting fees and expenses but not to exceed the sum of $25,000. 11. SUCCESSOR ORGANIZATION The obligations of the Corporation and the Bank as set forth herein shall continue to be the obligation of any successor organization, any organization which purchases substantially all of the liabilities of the Corporation or the Bank, as well as any organization which assumes substantially all of the liabilities of the Corporation or the Bank whether by merger, consolidation, or other form of business combination. This Agreement is personal to the Executive and the Executive may not delegate his duties hereunder. 12. NOTICES All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand or mailed, certified or registered mail, return 8 9 receipt requested, with postage prepaid to the following addresses or to such other address as either party may designate by like notice. (a) If to the Corporation, to: PVF Capital Corp. 2618 North Moreland Boulevard Cleveland, Ohio 44120 Attn: Vice President and Secretary (b) If to the Bank, to: Park View Federal Savings Bank 2618 North Moreland Boulevard Cleveland, Ohio 44120 Attn: Corporate Secretary (c) If to the Executive, to: and to such other or additional person or persons as either party shall have designated to the other party in writing by like notice. 13. AMENDMENTS No amendments or additions to this Agreement shall be binding unless in writing and signed by both parties, except as herein otherwise provided. 14. PARAGRAPH HEADINGS The paragraph headings used in this Agreement are included solely for convenience and shall not affect, or be used in connection with, the interpretation of this Agreement. 9 10 15. SEVERABILITY The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions here. 16. GOVERNING LAW This Agreement shall, except to the extend that federal law (including any law, rule, or regulations of the OTS or the FDIC) shall be deemed to apply, be governed by and construed and enforced in accordance with the laws of Ohio. 17. ARBITRATION Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration in accordance with the rules of the American Arbitration Association then in effect. Judgment may be entered on the arbitrator's award in any court having jurisdiction. 18. SAFETY AND SOUNDNESS LIMITATIONS Notwithstanding any other provision of this Agreement, no severance benefits under Paragraph 8 shall be paid or payable in respect of any year in which the Bank (i) fails to meet any applicable capital requirements imposed by Part 567 of the OTS regulations (or successor regulations) after giving effect to the payment of severance benefits hereunder, (ii) receives or maintains a safety and soundness CAMEL rating of 4 or 5 from the OTS, or (iii) is subject to a proceeding to terminate deposit insurance. Severance benefits can be paid under clause (i) above to the extent that such payment would not cause the Bank to fail to meet any applicable capital requirements imposed by part 567 of the OTS regulations. In addition, no severance benefits under Paragraph 8 shall be paid or payable if the Executive has committed any fraudulent act or omission or other fiduciary breach that had or is likely to have a material adverse affect on the bank or the Corporation. 10 11 19. ENTIRE AGREEMENT This Agreement supersedes the July 1, 1998 Severance Agreement by and among the Corporation, the Bank and the Executive. IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first herein above written. WITNESSES: PVF CAPITAL CORP. _______________________ By: _____________________________ James W. Male _______________________ Its: Chairman of the Board WITNESSES: PARK VIEW FEDERAL SAVING BANK _______________________ By: _____________________________ Stuart D. Neidus _______________________ Its: Chairman of the Compensation Committee WITNESSES: EXECUTIVE _______________________ __________________________ _______________________ County of Cuyahoga ) ) ss: State of Ohio ) Before me this _______ day of _____________, 1999, personally appeared the above named James W. Male, Stuart D. Neidus and , who acknowledged that they did sign the foregoing instrument and that the same was their free act and deed. ___________________________ (Notary Seal) Notary Public My Commission Expires: 11 EX-27 3 EXHIBIT 27

<ARTICLE> 9

<LEGEND> This schedule contains summary financial information extracted from the Statement of Condition and the Statement of Operation for the period ended September 30, 1999 and is qualified in its entirety by reference to such financial statements.

<MULTIPLIER> 1,000 <PERIOD-TYPE> 3-MOS <FISCAL-YEAR-END> JUN-30-2000 <PERIOD-START> JUL-01-1999 <PERIOD-END> SEP-30-1999 <CASH> 3,752 <INT-BEARING-DEPOSITS> 351 <FED-FUNDS-SOLD> 3,550 <TRADING-ASSETS> 0 <INVESTMENTS-HELD-FOR-SALE> 0 <INVESTMENTS-CARRYING> 25,317 <INVESTMENTS-MARKET> 24,676 <LOANS> 417,747 <ALLOWANCE> 2,942 <TOTAL-ASSETS> 466,003 <DEPOSITS> 334,004 <SHORT-TERM> 40,000 <LIABILITIES-OTHER> 10,888 <LONG-TERM> 41,024 <PREFERRED-MANDATORY> 0 <PREFERRED> 0 <COMMON> 44 <OTHER-SE> 40,043 <TOTAL-LIABILITIES-AND-EQUITY> 466,003 <INTEREST-LOAN> 8,595 <INTEREST-INVEST> 517 <INTEREST-OTHER> 0 <INTEREST-TOTAL> 9,112 <INTEREST-DEPOSIT> 3,869 <INTEREST-EXPENSE> 4,900 <INTEREST-INCOME-NET> 4,212 <LOAN-LOSSES> 350 <SECURITIES-GAINS> 0 <EXPENSE-OTHER> 1,016 <INCOME-PRETAX> 2,327 <INCOME-PRE-EXTRAORDINARY> 0 <EXTRAORDINARY> 0 <CHANGES> 0 <NET-INCOME> 1,552 <EPS-BASIC> 0.35 <EPS-DILUTED> 0.34 <YIELD-ACTUAL> 3.470 <LOANS-NON> 4,945 <LOANS-PAST> 0 <LOANS-TROUBLED> 0 <LOANS-PROBLEM> 0 <ALLOWANCE-OPEN> 2,630 <CHARGE-OFFS> 38 <RECOVERIES> 0 <ALLOWANCE-CLOSE> 2,942 <ALLOWANCE-DOMESTIC> 2,942 <ALLOWANCE-FOREIGN> 0 <ALLOWANCE-UNALLOCATED> 2,941

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M-#$@,"!2#0H^/@T*96YD;V)J#0HT.2`P(&]B:@T*/#P-"B]# -----END PRIVACY-ENHANCED MESSAGE-----

EX-10.3

   1
EXHIBIT NO. 10.3 - FORM OF SEVERANCE AGREEMENT
                   ---------------------------

                               SEVERANCE AGREEMENT

         This AGREEMENT is made and entered into this 26th day of October, 1999,
by and among PVF Capital Corporation (the "Corporation"), a corporation
organized under the laws of the State of Ohio, Park View Federal Savings Bank
(the "Bank"), an OTS-chartered, FDIC-insured savings association with its main
office located in Cleveland, Ohio and                         (the "Executive").
Any reference to the "Board of Directors" herein shall mean the Board of
Directors of the Corporation or the Bank or a committee serving at the pleasure
of the Board of Directors of the Bank. Any reference to "FDIC" herein shall mean
the Federal Deposit Insurance Corporation. Any reference to "OTS" shall mean the
Office of Thrift Supervision.

         WHEREAS, the Executive serves as an employee of the Bank;

         WHEREAS, the Corporation, the Bank and the Executive are parties to a
Severance Agreement dated July 1, 1998; and

         WHEREAS, the parties hereto desire that this Agreement supersede and
replace in its entirety the July 1, 1998 Severance Agreement;

         NOW THEREFORE, in consideration of the performance of the
responsibilities of the Executive and upon the other terms and conditions
hereinafter provided, the parties hereto agree as follows:

1.       NO EMPLOYMENT CONTRACT

         The parties hereto acknowledge and agree that this Agreement is not a
management or employment agreement and that nothing in this Agreement shall give
the Executive any rights or impose any obligations to continued employment by
the Bank or Corporation or any subsidiary or successor of the Bank or
Corporation, nor shall it give the Bank or Corporation any rights or impose any
obligations for the continued performance of duties by the Executive for the
Bank or Corporation or any subsidiary or successor of the Bank or Corporation.
   2

2.       TERM OF AGREEMENT

         The initial term of this Agreement shall be for a period of three (3)
years commencing November 1st, 1999 (hereafter referred to as the "Anniversary
Date"). Commencing on the first Anniversary Date of this Agreement, and
continuing at each Anniversary Date thereafter, the Agreement shall
automatically renew for one (1) additional year beyond the then effective
expiration date only upon a determination and resolution of the Board of
Directors that the performance of the Executive has met the requirements and
standards of the Board and that such term shall be extended. If the Board of
Directors determines not to extend the term, it shall promptly so notify the
Executive, with such election by the Board not to extend the term not to
otherwise affect the then effective term of this Agreement. Reference herein to
the term of this Agreement shall refer both to such initial term and such
extended terms. Unless sooner terminated as set forth herein, this contract
shall terminate when the Executive reaches age sixty-five (65).

3.       TERMINATION FOR CAUSE

         If the Corporation or Bank terminates the Executive's employment for
cause (as defined below), all of the Bank's and Corporation's obligations
hereunder shall immediately terminate as of the termination date. As used
herein, "for cause" shall mean (i) gross misconduct by the Executive that is
materially inconsistent with the terms hereof, or (ii) material failure by the
Executive to perform his duties, either of which continues after written notice
thereof and a fifteen (15) day chance to cure or (iii) the Executive's
conviction for committing a felony.

4.       VOLUNTARY TERMINATION OF AGREEMENT

         This Agreement may be terminated by the Executive at any time upon
ninety (90) days' written notice to either the Bank or the Corporation or upon
such shorter period as may be agreed upon between the Executive and the Board of
Directors.

                                       2
   3

5.       GOVERNMENTAL TERMINATION OF AGREEMENT

         (a) If the Executive is removed from office and/or permanently
prohibited from participating in the conduct of the Bank's or the Corporation's
affairs by an order issued under Section 8(e) of the Federal Deposit Insurance
Act, 12 U.S.C. sec. 1818(e), all obligations of the Bank and the Corporation
under this Agreement shall terminate, as of the effective date of the order.

         (b) If the Bank is in default (as defined in Section 3(x)(1) of the
Federal Deposit Insurance Act), all obligations under this Agreement shall
terminate.

         (c) All obligations under this Agreement shall be terminated, except to
the extent determined that continuation of the contract is necessary for the
continued operation of the Bank, by the Director of the OTS or his or her
designee at the time the FDIC enters into an agreement to provide assistance to
or on behalf of the Bank under the authority contained in Section 13(c) of the
Federal Deposit Insurance Act, or by the Director of the OTS or his or her
designee at the time the Director of the OTS or his or her designee approves a
supervisory merger to resolve problems related to the operation of the Bank or
when the Bank is determined by the Director of the OTS to be in an unsafe or
unsound condition. Any rights of the parties that have already vested, however,
shall not be affected by such action.

         (d) If the Executive is suspended and/or temporarily prohibited from
participating in the conduct of the Bank's affairs by a notice served under
Section 8 (e)(3) or (g)(1) of the Federal Deposit Insurance Act, 12 U.S.C.
sec. 1818(e)(3) or (g)(1), the Corporation's and the Bank's obligations under
subparagraphs 6(a), (b) and (c) of this Agreement shall be suspended as the date
of service, unless stayed by appropriate proceedings.

         (e) If the charges in the notice referenced in subparagraph 5(d) are
dismissed, the Board of Directors may in its discretion:



                                       3
   4

         (i)      pay the Executive all or part of the severance benefits while
                  the Corporation's and the Bank's contract obligations were
                  suspended, and

         (ii)     reinstate (in whole or in part) any of the Corporation's and
                  the Bank's obligations which were suspended as required in
                  subparagraph (d) above.

6.       SEVERANCE PAYMENTS OR TERMINATION BENEFITS

         For purpose of this Agreement, the severance payments and termination
benefits specified in this Paragraph 6 shall be payable to the Executive
subsequent to the occurrence of one of the following events:

         (i)      Involuntary termination of the Executive's employment with the
                  Bank or Corporation with or within one (1) year after a Change
                  in Control, other than for Cause or pursuant to Paragraphs 4
                  or 5 of this Agreement. For purposes of this section, Change
                  in Control shall have the same meaning as such term is defined
                  in Paragraph 8, and Cause shall have the same meaning as such
                  term is defined in Paragraph 3.

         (ii)     Voluntary or involuntary termination for Good Reason, as
                  defined in Paragraph 7, and other than for Cause or pursuant
                  to Paragraphs 4 or 5 of this Agreement.

         (a) Upon the Executive's termination as a result of one of the events
specified in this Paragraph 6, the Bank or Corporation shall pay to Executive,
or in the event of his subsequent death, his beneficiary or beneficiaries, or
his estate as the case may be, as severance pay or liquidated damages, or both,
a sum equal to two times the Executive's annual compensation. For purposes of
this Paragraph, compensation shall be defined as the Executive's then current
base salary, plus annual incentive compensation for the calendar year
immediately preceding the year in which the above-mentioned event occurs. Such
payment shall be paid to the Executive in a lump sum within thirty (30) days of
the Executive's date of termination. The amount payable to the Executive
hereunder shall not be reduced to account for the time value of money or
discounted to present value.

         (b) Upon the Executive's termination as a result of one of the events
specified in this Paragraph 6, the Bank or Corporation shall cause the Executive
to become fully vested in any qualified and/or



                                       4
   5

nonqualified plans, programs or arrangements in which the Executive
participated, notwithstanding any provisions contained in the respective
Agreement of the plan, program or arrangement. The Bank shall also contribute to
the Executive's 401(k) Plan Account the Bank's matching and/or profit sharing
which would have been paid had the Executive remained in the employ of the Bank
throughout the remainder of the 401(k) Plan year.

         (c) Upon the Executive's termination as a result of one of the events
specified in this Paragraph 6, the Corporation or Bank will cause to be
continued life, health and disability insurance coverage substantially identical
to the coverage maintained by the Bank or the Corporation for the Executive
prior to his severance. Such coverage shall cease upon the earlier of
Executive's employment by another employer or twelve (12) months from such
termination. Upon the expiration of the twelve (12) month period, Executive
shall have the option of continuing health insurance coverage at his/her own
expense for a period not less than the number of months by which the
Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation period
exceeds twelve (12) months.

         (d) The Executive shall not be required to mitigate the amount of any
payment required hereunder by seeking other employment or otherwise nor shall
the amount paid hereunder be reduced or offset by any compensation earned or
received by the Executive as a result of employment with another employer or
self-employment. The amount paid hereunder shall not be reduced by any other
plan, program, policy or arrangement of the Bank or Corporation. Benefits
provided under Paragraph 6(c) shall be reduced to the extent comparable benefits
are actually received by the Executive from or through another employer.

7.       GOOD REASON

         For purposes of this Agreement, "Good Reason" means the occurrence of
any of the events or conditions described in subparagraphs (a) through (f)
hereof without the Executive's express written


                                       5
   6

consent; provided the Executive's right to terminate his employment pursuant to
this Paragraph 7 shall not be affected by his incapacity due to physical or
mental illness.

         (a)      A change in the Executive's status, title, position or
                  responsibilities (including reporting responsibilities) which,
                  in the Executive's reasonable judgment, does not represent a
                  promotion from his status, title, position or responsibilities
                  as in effect immediately prior thereto; the assignment to the
                  Executive of any duties or responsibilities which, in the
                  Executive's reasonable judgment, are inconsistent with such
                  status, title, position or responsibilities; or any removal of
                  the Executive from or failure to reappoint him to any of such
                  positions, except in connection with the termination of his
                  employment for (i) Cause, (ii) pursuant to Paragraphs 4 or 5,
                  (iii) by the Executive other than for Good Reason;

         (b)      A material reduction by the Bank or the Corporation in the
                  Executive's base salary;

         (c)      The relocation of Executive's principal place of employment to
                  a location that is more than thirty-five (35) miles from the
                  location where Executive was principally employed immediately
                  prior to such relocation or the Bank's or the Corporation's
                  requiring the Executive to be based at any place other than
                  the location where the Executive was based immediately prior
                  to such change, except for reasonably required travel (as
                  determined by the Board of Directors) on the Bank's or the
                  Corporation's business;

         (d)      The failure by the Bank or the Corporation to continue to
                  provide the Executive with benefits substantially similar to
                  those provided to him under any of the employee benefit plans
                  in which the Executive becomes a participant, or the taking of
                  any action by the Bank or the Corporation which would directly
                  or indirectly materially reduce any of such benefits or
                  deprive the Executive of any material fringe benefit enjoyed
                  by him;

         (e)      Death prior to retirement. If the Executive dies while
                  actively employed by the Bank or Corporation prior to
                  retirement; or

         (f)      Disability prior to retirement. If the Executive becomes
                  totally disabled while actively employed by the Bank or
                  Corporation prior to retirement. For purposes of this
                  agreement, the term "totally disabled" means that because of
                  injury or sickness, the Executive is unable to perform his
                  duties.


8.       CHANCE IN CONTROL

         (a) If there is a Change in Control of the Bank or Corporation during
the term of this Agreement, the Executive shall be entitled to severance
payments and/or termination benefits as described in Paragraph 6 if the
Executive's employment with the Bank or the Corporation is involuntarily
terminated in connection


                                       6
   7

with or within one (1) year after the Change in Control, other than for Cause or
pursuant to Paragraphs 4 or 5. This payment shall also be made in the case of
the Executive's voluntary termination of employment for Good Reason (as defined
in Paragraph 7) in connection with or within one (1) year after a Change in
Control of the Bank or Corporation. Such voluntary termination of employment for
Good Reason in connection with or within one (1) year after a Change in Control
of the Bank or Corporation shall not constitute a termination for Cause or a
voluntary termination subject to Paragraph 4 of this Agreement.

         (b) For purposes of this Agreement, "Change in Control of the Bank or
Corporation" means:

         (i)      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 Corporation's voting securities;

         (ii)     the acquisition by a person of the power to direct the Bank's
                  or Corporation'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 Corporation for the purposes of the
                  Savings & Loan Holding Company Act or the Change in Bank
                  Control Act and the regulations thereunder;

         (iii)    during any period of two (2) consecutive years during the term
                  of this Agreement, individuals who at the beginning of such
                  period constitute the Board of Directors of the Bank or the
                  Corporation 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;

         (iv)     the Corporation shall have merged into or consolidated with
                  another corporation, or merged another corporation into the
                  Corporation, on a basis whereby less than fifty percent (50%)
                  of the total voting power of the surviving corporation is
                  represented by shares held by former shareholders of the
                  Corporation prior to such merger or consolidation; or

         (v)      the Corporation shall have sold to another person (i)
                  substantially all of the Corporation'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.

                                       7
   8

9.       WITHHOLDING OF TAXES

         The Bank or Corporation may withhold from any benefits payable under
this Agreement all Federal, state, city or other taxes as may be required
pursuant to any law, governmental regulation or ruling.

10.      PAYMENT OF LEGAL AND/OR ACCOUNTING FEES

         Reasonable legal and/or accounting fees and expenses paid or incurred
by the Executive pursuant to any dispute or question of interpretation relating
to the Agreement shall be paid or reimbursed by the Corporation in accordance
with the following:

         (a)      If the Executive, the Bank or the Corporation initiates a
                  proceeding and the Executive prevails, all reasonable legal
                  and/or accounting fees and expenses shall be paid by the
                  Corporation.

         (b)      If the Executive initiates a proceeding and does not prevail
                  on his claim, then the Corporation shall reimburse the
                  Executive for all legal and/or accounting fees and expenses
                  but not to exceed the sum of $25,000.

11.      SUCCESSOR ORGANIZATION

         The obligations of the Corporation and the Bank as set forth herein
shall continue to be the obligation of any successor organization, any
organization which purchases substantially all of the liabilities of the
Corporation or the Bank, as well as any organization which assumes substantially
all of the liabilities of the Corporation or the Bank whether by merger,
consolidation, or other form of business combination. This Agreement is personal
to the Executive and the Executive may not delegate his duties hereunder.

12.      NOTICES

         All notices, requests, demands and other communications hereunder shall
be in writing and shall be deemed to have been duly given if delivered by hand
or mailed, certified or registered mail, return


                                       8
   9

receipt requested, with postage prepaid to the following addresses or to such
other address as either party may designate by like notice.

         (a) If to the Corporation, to:


                                  PVF Capital Corp.
                                  2618 North Moreland Boulevard
                                  Cleveland, Ohio 44120
                                  Attn: Vice President and Secretary

         (b) If to the Bank, to:

                                  Park View Federal Savings Bank
                                  2618 North Moreland Boulevard
                                  Cleveland, Ohio   44120
                                  Attn: Corporate Secretary

         (c) If to the Executive, to:


and to such other or additional person or persons as either party shall have
designated to the other party in writing by like notice.

13.      AMENDMENTS

         No amendments or additions to this Agreement shall be binding unless in
writing and signed by both parties, except as herein otherwise provided.

14.      PARAGRAPH HEADINGS

         The paragraph headings used in this Agreement are included solely for
convenience and shall not affect, or be used in connection with, the
interpretation of this Agreement.



                                       9
   10


15.      SEVERABILITY

         The provisions of this Agreement shall be deemed severable and the
invalidity or unenforceability of any provision shall not affect the validity or
enforceability of the other provisions here.

16.      GOVERNING LAW

         This Agreement shall, except to the extend that federal law (including
any law, rule, or regulations of the OTS or the FDIC) shall be deemed to apply,
be governed by and construed and enforced in accordance with the laws of Ohio.

17.      ARBITRATION

         Any dispute or controversy arising under or in connection with this
Agreement shall be settled exclusively by arbitration in accordance with the
rules of the American Arbitration Association then in effect. Judgment may be
entered on the arbitrator's award in any court having jurisdiction.

18.      SAFETY AND SOUNDNESS LIMITATIONS

         Notwithstanding any other provision of this Agreement, no severance
benefits under Paragraph 8 shall be paid or payable in respect of any year in
which the Bank (i) fails to meet any applicable capital requirements imposed by
Part 567 of the OTS regulations (or successor regulations) after giving effect
to the payment of severance benefits hereunder, (ii) receives or maintains a
safety and soundness CAMEL rating of 4 or 5 from the OTS, or (iii) is subject to
a proceeding to terminate deposit insurance. Severance benefits can be paid
under clause (i) above to the extent that such payment would not cause the Bank
to fail to meet any applicable capital requirements imposed by part 567 of the
OTS regulations. In addition, no severance benefits under Paragraph 8 shall be
paid or payable if the Executive has committed any fraudulent act or omission or
other fiduciary breach that had or is likely to have a material adverse affect
on the bank or the Corporation.




                                       10
   11

19.      ENTIRE AGREEMENT

         This Agreement supersedes the July 1, 1998 Severance Agreement by and
among the Corporation, the Bank and the Executive.

         IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year first herein above written.

WITNESSES:                                PVF CAPITAL CORP.

_______________________                   By:      _____________________________
                                                   James W. Male
_______________________                   Its:     Chairman of the Board


WITNESSES:                       PARK VIEW FEDERAL SAVING BANK

_______________________                   By:      _____________________________
                                                   Stuart D. Neidus
_______________________                   Its:     Chairman of the Compensation
                                                   Committee


WITNESSES:                                EXECUTIVE

_______________________                   __________________________

_______________________
County of Cuyahoga         )
                                    ) ss:
State of Ohio              )

         Before me this _______ day of _____________, 1999, personally appeared
the above named James W. Male, Stuart D. Neidus and                       , who
acknowledged that they did sign the foregoing instrument and that the same was
their free act and deed.

                                                     ___________________________
(Notary Seal)                                        Notary Public

                                                     My Commission Expires:


                                       11

EX-27

 

<ARTICLE> 9
<LEGEND>
This schedule contains summary financial information extracted from the
Statement of Condition and the Statement of Operation for the period ended
September 30, 1999 and is qualified in its entirety by reference to such
financial statements.

<MULTIPLIER> 1,000

                             
<PERIOD-TYPE>                   3-MOS
<FISCAL-YEAR-END>                          JUN-30-2000
<PERIOD-START>                             JUL-01-1999
<PERIOD-END>                               SEP-30-1999
<CASH>                                           3,752
<INT-BEARING-DEPOSITS>                             351
<FED-FUNDS-SOLD>                                 3,550
<TRADING-ASSETS>                                     0
<INVESTMENTS-HELD-FOR-SALE>                          0
<INVESTMENTS-CARRYING>                          25,317
<INVESTMENTS-MARKET>                            24,676
<LOANS>                                        417,747
<ALLOWANCE>                                      2,942
<TOTAL-ASSETS>                                 466,003
<DEPOSITS>                                     334,004
<SHORT-TERM>                                    40,000
<LIABILITIES-OTHER>                             10,888
<LONG-TERM>                                     41,024
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                            44
<OTHER-SE>                                      40,043
<TOTAL-LIABILITIES-AND-EQUITY>                 466,003
<INTEREST-LOAN>                                  8,595
<INTEREST-INVEST>                                  517
<INTEREST-OTHER>                                     0
<INTEREST-TOTAL>                                 9,112
<INTEREST-DEPOSIT>                               3,869
<INTEREST-EXPENSE>                               4,900
<INTEREST-INCOME-NET>                            4,212
<LOAN-LOSSES>                                      350
<SECURITIES-GAINS>                                   0
<EXPENSE-OTHER>                                  1,016
<INCOME-PRETAX>                                  2,327
<INCOME-PRE-EXTRAORDINARY>                           0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                     1,552
<EPS-BASIC>                                       0.35
<EPS-DILUTED>                                     0.34
<YIELD-ACTUAL>                                   3.470
<LOANS-NON>                                      4,945
<LOANS-PAST>                                         0
<LOANS-TROUBLED>                                     0
<LOANS-PROBLEM>                                      0
<ALLOWANCE-OPEN>                                 2,630
<CHARGE-OFFS>                                       38
<RECOVERIES>                                         0
<ALLOWANCE-CLOSE>                                2,942
<ALLOWANCE-DOMESTIC>                             2,942
<ALLOWANCE-FOREIGN>                                  0
<ALLOWANCE-UNALLOCATED>                          2,941


 

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