10-Q 1 ffy-10q1.txt BODY OF 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 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, 2000 OR [ ] 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 0-21638 FFY Financial Corp. (Exact name of registrant as specified in its charter) Delaware 34-1735753 (State of Incorporation) (IRS Employer Identification No.) 724 Boardman-Poland Road, Youngstown, Ohio (Address of principal executive office) 44512 (Zip Code) (330) 726-3396 (Registrant's telephone number, including area code) 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. CLASS SHARES OUTSTANDING AT OCTOBER 27, 2000 ----- -------------------------------------- common stock, $.01 par value 6,621,913 INDEX Page ---- PART I. FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Statements of Financial Condition 3 Consolidated Statements of Income 4 Consolidated Statements of Changes in Stockholders' Equity 5 Consolidated Statements of Cash Flows 6 Notes to Consolidated Financial Statements 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 Item 3. Quantitative and Qualitative Disclosures About Market Risk 13 PART II. OTHER INFORMATION Item 1. Legal Proceedings 14 Item 2. Changes in Securities and Use of Proceeds 14 Item 3. Defaults Upon Senior Securities 14 Item 4. Submission of Matters to a Vote of Security Holders 14 Item 5. Other Information 14 Item 6. Exhibits and Reports on Form 8-K 14 SIGNATURES 15 PART I: FINANCIAL INFORMATION ITEM 1: FINANCIAL STATEMENTS FFY FINANCIAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (unaudited)

See accompanying notes to consolidated financial statements PART I: FINANCIAL INFORMATION ITEM 1: FINANCIAL STATEMENTS FFY FINANCIAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (unaudited)

See accompanying notes to consolidated financial statements PART I: FINANCIAL INFORMATION ITEM 1: FINANCIAL STATEMENTS FFY FINANCIAL CORP. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Principles of Consolidation: The interim consolidated financial statements of the Company include the accounts of FFY Financial Corp. (FFY) and its wholly-owned subsidiaries FFY Bank (Bank) and FFY Holdings, Inc. The consolidated financial statements also include the accounts of FFY Insurance Agency, Ltd., the insurance affiliate of FFY Holdings, Inc. The accounts of FFY Holdings, Inc.'s real estate affiliate, ColdwellBanker FFY Real Estate, are not consolidated since the Company owns a non-controlling one-third interest. All significant intercompany balances and transactions have been eliminated in consolidation. (b) Basis of Presentation: The consolidated financial statements have been prepared in conformity with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in FFY Financial Corp.'s 2000 Annual Report to Shareholders incorporated by reference into FFY Financial Corp.'s 2000 Annual Report on Form 10-K. The interim consolidated financial statements include all adjustments (consisting of only normal recurring items) which, in the opinion of management, are necessary for a fair presentation of the financial position and results of operations for the periods presented. The results of operations for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year. (c) Earnings Per Share: The computation of basic and diluted earnings per share is shown in the following table.

PART I: FINANCIAL INFORMATION ITEM 1: FINANCIAL STATEMENTS FFY FINANCIAL CORP. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CON'T) (unaudited) (1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CON'T) (d) Reclassifications: Certain amounts in the prior period consolidated financial statements have been reclassified to conform with the current period's presentation. (2) EFFECT OF RECENT FINANCIAL ACCOUNTING STANDARDS In June 1998, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 133, Accounting for Derivative Instruments and Hedging Activities, that was subsequently amended by SFAS No. 137, which delayed the original effective date of SFAS No. 133. This Statement standardizes the accounting for derivative contracts, by requiring that an entity recognize those items as assets or liabilities in the statement of financial condition and measure them at fair value. SFAS No. 137 was effective for the Company on July 1, 2000. Management determined that the Company did not engage in any hedging activities or derivative instruments and therefore, the adoption of SFAS No. 137 had no impact on financial condition or results of operations. (3) PENDING MERGER On May 23, 2000, FFY and First Place Financial Corp. (First Place), the holding company for First Federal Savings and Loan Association of Warren, entered into a definitive agreement (the Merger Agreement) to combine in a merger of equals (the Merger). The Merger Agreement calls for a tax-free exchange of each outstanding share of FFY common stock for 1.075 shares of First Place common stock, with cash paid in lieu of fractional shares. In addition, pursuant to the Merger Agreement, FFY Bank will merge with First Federal Savings and Loan Association of Warren to become First Place Bank. The Merger will be accounted for as a purchase by First Place and is expected to close in the fourth quarter of calendar year 2000. The Merger Agreement has been approved by the boards of directors of both companies. However, it is subject to certain other conditions, including the approval of the shareholders of both companies and the approval of regulatory authorities. Included in the Company's results of operations for the three months ended September 30, 2000 were $118,000 in pre-tax expenses for professional fees related to the pending Merger with First Place. PART I: FINANCIAL INFORMATION FFY FINANCIAL CORP. SEPTEMBER 30, 2000 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations The following analysis discusses changes in the Company's financial condition and results of operations at and for the three months ended September 30, 2000. Forward-Looking Statements When used in this Form 10-Q, or, in future filings by FFY Financial Corp. with the Securities and Exchange Commission, in FFY Financial Corp.'s press releases or other public or shareholder communications, or in oral statements made with the approval of an authorized executive officer, 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, but not limited to, 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 and other factors 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. Financial Condition General. Total assets at September 30, 2000 were $684.0 million compared to $674.5 million at June 30, 2000, an increase of $9.5 million, or 1.4%. The increase in assets was primarily attributable to growth in the loan portfolio. Total liabilities at September 30, 2000 were $617.3 million compared to $609.3 million at June 30, 2000, an increase of $8.0 million, or 1.3%. The increase in liabilities was primarily attributable to increases in borrowed funds and other liabilities partially offset by a decline in deposit accounts. The discussion below provides greater detail regarding significant changes in balance sheet items. Securities. The Company's securities portfolio totaled $158.4 million at September 30, 2000, which is comparable to $158.1 million at June 30, 2000. A decline in the unrealized loss on securities available for sale totaling $2.8 million for the three-month period, reflecting a decrease in interest rates, was mostly offset by principal receipts on the Company's mortgage- backed securities portfolio totaling $2.4 million. Loans. Net loans receivable, including loans available for sale, increased $8.2 million, or 1.7%, during the three months ended September 30, 2000, and totaled $492.9 million at September 30, 2000 compared to $484.7 million at June 30, 2000. First mortgage loans at September 30, 2000 totaled $448.5 million, up from $442.9 million at June 30, 2000, and represented 88.3% of the gross loan portfolio at September 30, 2000. The increase in first mortgage loans was primarily in loans secured by one- to four -family residences and commercial real estate. One- to four -family residential loans totaled $356.6 million, 70.2%, of total gross loans at September 30, 2000, compared to $351.4 million, or 70.2%, of total gross loans at June 30, 2000. The dollar volume increase in one- to four -family loans was the result of retaining newly- originated loans in the Bank's portfolio as opposed to selling them in the secondary market due to current market interest rates. Commercial real estate loans totaled $47.0 million, or 9.3%, of total gross loans at September 30, 2000, compared to $44.6 million, or 8.9%, of total gross loans at June 30, 2000. Consumer loans at September 30, 2000 totaled $59.5 million, up from $57.4 million at June 30, 2000, and represented 11.7% of the gross loan portfolio at September 30, 2000. The increase in consumer loans was primarily in home equity loans, which totaled $46.9 million, or 9.2%, of total gross loans at September 30, 2000, compared to $44.4 million, or 8.9%, of total gross loans at June 30, 2000. Loan originations during the three months ended September 30, 2000 totaled $42.9 million, comparable to $42.7 million for the same prior year period. Mortgage loans for the purchase, construction or refinance of one- to four - family homes continued to represent the largest segment of the Bank's loan originations. During the three months ended September 30, 2000, one- to four -family loan originations, including the construction of one- to four - family homes, were $25.3 million, representing 59.1% of total loan originations. FFY Bank's secondary market mortgage lending operation originates and sells qualifying loans to Fannie Mae. FFY Bank sold 57 loans during the three months ended September 30, 2000, resulting in a pre-tax gain of $111,000. This compares to sales of 48 loans for a pre-tax gain of $60,000 for the three months ended September 30, 1999 - see "Results of Operations - Non- Interest Income", below. Management expects that the secondary market mortgage lending program will continue as long as market conditions allow it to be profitable. Deposits. Deposits decreased $6.6 million, or 1.5%, during the three months ended September 30, 2000 and totaled $439.4 million at September 30, 2000 compared to $446.0 million at June 30, 2000. Declines in certificate, passbook and NOW accounts of $4.8 million, $3.7 million and $1.1 million, respectively, were partially offset by increases of $2.4 million and $588,000 in money market and other checking accounts, respectively. The net deposit outflow during the three months ended September 30, 2000 was primarily funded with increased borrowings. Although market interest rates slightly declined during the first quarter of fiscal year 2001, the weighted average cost of deposits was 4.73% at September 30, 2000, a 17 basis point increase from 4.56% at June 30, 2000. The level of deposit flows and rates offered during any given period are heavily influenced by factors such as the general level of interest rates and competition, such as competitors' deposit specials, money market mutual funds and other investments. Repurchase Agreements and Borrowed Funds. Short-term repurchase agreements increased $969,000, or 14.0%, during the three months ended September 30, 2000 and totaled $7.9 million at September 30, 2000 compared to $6.9 million at June 30, 2000. Long-term repurchase agreements remained constant at $51.3 million at both September 30, 2000 and June 30, 2000. The weighted average cost of total repurchase agreements was 6.86% at September 30, 2000 compared to 6.80% at June 30, 2000. Short-term borrowings increased $10.5 million during the three months ended September 30, 2000 and totaled $28.0 million at September 30, 2000 compared to $17.5 million at June 30, 2000. The increase in short-term borrowings was primarily used to fund net deposit outflows and the increase in loans receivable. Long-term borrowed funds remained constant at $79.3 million at both September 30, 2000 and June 30, 2000. The weighted average cost of total borrowings declined from 6.68% at June 30, 2000 to 6.57% at September 30, 2000 due to declining interest rates during the first quarter of fiscal year 2001. Other Liabilities. Other liabilities increased $4.5 million during the three months ended September 30, 2000 and totaled $10.4 million at September 30, 2000 compared to $5.9 million at June 30, 2000. This increase was primarily attributable to increases in (i) accrued interest payable on deposit accounts since interest on most certificates are paid semi-annually at June 30 and December 31; (ii) accrued and deferred federal income taxes; and (iii) amounts due to the Bank's official check company, which fluctuates daily based on activity. Stockholders' Equity. Total stockholders' equity increased $1.5 million, or 2.4%, during the three months ended September 30, 2000 and totaled $66.7 million at September 30, 2000 compared to $65.2 million at June 30, 2000. This increase resulted principally from net income for the three months ended September 30, 2000 totaling $1.5 million and an increase in market value of available-for-sale securities, net of tax, totaling $1.8 million. These increases were partially offset by $1.2 million and $783,000 in stock repurchases and dividends paid to stockholders, respectively, during the same three-month period. Results of Operations Comparison of the Three Months Ended September 30, 2000 and 1999 General. The Company recorded net income for the three months ended September 30, 2000 of $1.5 million, a decrease of $363,000, or 19.7%, from net income of $1.8 million for the three months ended September 30, 1999. Diluted earnings per share for the three months ended September 30, 2000 were $0.23, a 14.8% decline from diluted earnings per share of $0.27 for the three months ended September 30, 1999. The current period was negatively impacted by merger-related expenses and a valuation allowance, which are explained in greater detail below. Interest Income. Total interest income for the three months ended September 30, 2000 was $12.9 million, an increase of $521,000, or 4.2% compared to $12.4 million for the three months ended September 30, 1999. Interest income from loans totaled $10.3 million for the three months ended September 30, 2000, an increase of $783,000, or 8.2%, compared to $9.5 million for the three months ended September 30, 1999. The increase in interest from loans was the result of a $32.5 million increase in the average balance of loans outstanding and a 9 basis point increase in yield earned. A $256,000, or 9.3%, decline in interest income from securities partially offset the increase in interest income from loans. The decline in interest income from securities was the result of a $25.4 million decline in the average balance of securities partially offset by a 38 basis point increase in yield earned on the securities portfolio. Interest Expense. Total interest expense for the three months ended September 30, 2000 was $7.9 million, an increase of $1.1 million, or 15.7% compared to $6.8 million for the three months ended September 30, 1999. This increase in interest expense was primarily the result of higher market interest rates for the September 2000 quarter as compared to the September 1999 quarter. Additionally, the average balance of repurchase agreements and borrowed funds increased as a result of funds needed to provide for the increase in loans receivable in addition to the decline in deposits from September 30, 1999 to September 30, 2000. Interest expense from deposit accounts totaled $5.2 million, an increase of $303,000, or 6.2%, compared to $4.9 million for the three months ended September 30, 1999. The increased interest expense from deposit accounts was primarily due to a 41 basis point increase in rate paid on deposits, which was partially offset by a $13.7 million decline in average deposit balances. Interest expense from long-term repurchase agreements totaled $890,000 for the three months ended September 30, 2000, an increase of $143,000 compared to $747,000 for the three months ended September 30, 1999. The increased interest expense from long-term repurchase agreements was due to a 112 basis point increase in rate. Interest expense from long-term borrowed funds totaled $1.3 million for the three months ended September 30, 2000, an increase of $521,000 compared to $788,000 for the three months ended September 30, 1999. The increased interest expense from long-term borrowed funds was due to both a $19.3 million increase in average balance and a 135 basis point increase in rate. Net Interest Income. Net interest income for the three months ended September 30, 2000 totaled $5.0 million, a decline of $548,000, or 9.8%, compared to $5.6 million for the three months ended September 30, 1999. The Company's net interest margin declined 35 basis points, from 3.54% for the quarter ended September 30, 1999 to 3.19% for the quarter ended September 30, 2000, primarily reflecting increased cost of funds. Provision for Loan Losses. The provision for loan losses totaled $202,000 for the three months ended September 30, 2000 compared to $101,000 for the three months ended September 30, 1999. The provision for loan losses reflects management's evaluation of the underlying credit risk of FFY Bank's loan portfolio to adequately provide for probable loan losses inherent in the loan portfolio as of the balance sheet date. The ratio of allowance for loan losses to non-performing assets was 70.1% at September 30, 2000, down from 78.4% at June 30, 2000, primarily due to increases in non-accrual loans and real estate owned. The Company's management analyzes the adequacy of the allowance for loan losses regularly through reviews of the performance of the loan portfolio, economic conditions, changes in interest rates and the effect of such changes on real estate values and changes in the composition of the loan portfolio. Future additions to the allowance for loan losses will be dependent on these factors. Management believes that the allowance for loan losses is adequate at September 30, 2000. Non-Interest Income. Non-interest income totaled $742,000 for the three months ended September 30, 2000, an increase of $275,000, or 59.0%, compared to $467,000 for the three months ended September 30, 1999. Service fee income increased $69,000 comparing the three-month periods, mainly from NOW, passbook and commercial checking accounts. Gains from sales of loans increased $51,000 comparing the three month periods, reflecting an increase in both the number of loans sold and the average balance of loans sold. Additionally, FFY Bank offered slightly-higher interest rates than its market area on its loan products during the three months ended September 30, 2000 as compared to the three months ended September 30, 1999. Gross profits from the Company's insurance affiliate, FFY Insurance, increased $215,000 comparing the quarter ended September 30, 2000 to the quarter ended September 30, 1999. This increase reflects the following three items, (i) FFY Insurance's acquisition of Moreman-Yerian Insurance Agency in May 2000; (ii) FFY Insurance's purchase of the minority interest in May 2000; and (iii) additional revenues from insurance policy renewals in addition to new customers. Partially offsetting the aforementioned increases was a $95,000 impairment charge on the Company's investment in Hedgerows Development, Ltd., the condominium development company in which the Company has a 50% ownership interest. The valuation allowance was the result of a decline in market value on the condominiums not yet sold. Non-Interest Expense. Non-interest expense totaled $3.4 million for the three months ended September 30, 2000, an increase of $123,000, or 3.7%, compared to $3.3 million for the three months ended September 30, 1999. The quarter ended September 30, 2000 included $118,000 in merger expenses relating to the pending merger of equals with First Place Financial Corp. The September 2000 quarter also included an additional $160,000 in expenses from FFY Insurance, primarily relating to the acquisition of Moreman-Yerian Insurance Agency. Increased expenses from FFY Insurance mainly included salaries and, to a lesser extent, occupancy and other expenses. Partially offsetting the aforementioned increases was $196,000 in name change expenses recorded during the September 30, 1999 quarter. On July 12, 1999, the Company announced a name change for its subsidiaries/affiliates to better reflect a single identity for the banking, insurance and real estate lines of business the Company operates. Income Taxes. Federal income taxes totaled $646,000 for the three months ended September 30, 2000, a decline of $135,000 compared to $781,000 for the three months ended September 30, 1999. The decline in federal income taxes resulted primarily from a decline in net income before taxes. Effect of New Accounting Standards Refer to Note 2 of the Notes to Consolidated Financial Statements contained in this report. Liquidity and Cash Flows In general terms, liquidity is a measurement of the Company's ability to meet its cash needs. The Company's objective in liquidity management is to maintain the ability to meet loan commitments, purchase securities or to repay deposits and other liabilities in accordance with their terms without an adverse impact on current or future earnings. The Company's principal sources of funds are deposits, amortization and prepayments of loans, maturities, sales and principal receipts of securities, borrowings, repurchase agreements and operations. Federal regulations require FFY Bank to maintain minimum levels of liquid assets in each calendar quarter of not less than 4% of either (i) its liquidity base at the end of the preceding quarter, or (ii) the average daily balance of its liquidity base during the preceding quarter. FFY Bank's liquidity exceeded the applicable liquidity requirement at September 30, 2000 and 1999. Simply meeting the liquidity requirement does not automatically mean FFY Bank has sufficient liquidity for a safe and sound operation. Regulations also include a separate requirement that each thrift must maintain sufficient liquidity to ensure its safe and sound operation. Thus, adequate liquidity may vary depending on FFY Bank's overall asset/liability structure, market conditions, the activities of competitors, and the requirements of its own deposit and loan customers. Management believes FFY Bank's liquidity is sufficient. Liquidity management is both a daily and long-term responsibility of management. FFY Bank adjusts its investments in liquid assets based upon management's assessment of (i) expected loan demand, (ii) expected deposit flows, (iii) yields available on interest-earning deposits and securities and (iv) the objective of its asset/liability management program. Along with its liquid assets, FFY Bank has additional sources of liquidity available including, but not limited to, the ability to obtain deposits by offering above-market interest rates and access to advances from the Federal Home Loan Bank. The primary investing activities of the Company are originating loans and purchasing securities. For the three months ended September 30, 2000, an increase in FFY Bank's loan portfolio used $8.3 million, whereas a decline in the securities portfolio provided $2.5 million. For the three months ended September 30, 1999, an increase in FFY Bank's loan portfolio used $6.7 million, whereas a decline in the securities portfolio provided $17.1 million. Generally, during periods of declining interest rates, FFY Bank would be expected to experience increased loan prepayments, which would likely be reinvested at lower interest rates. During periods of increasing interest rates, loan prepayments would be expected to decline, reducing funds available for investment at higher interest rates. The primary financing activities of the Company are deposits, repurchase agreements and borrowings. For the three months ended September 30, 2000, a decline in deposit accounts used $6.7 million, whereas increases in repurchase agreements and borrowed funds provided $969,000 and $10.5 million, respectively. For the three months ended September 30, 1999, a decline in deposits used $11.5 million, whereas an increase in borrowed funds provided $2.1 million. Capital Resources Office of Thrift Supervision (OTS) regulations require 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 September 30, 2000, the minimum capital regulations require savings institutions to have tangible capital to total tangible assets of 1.5%; a minimum leverage ratio of core (Tier 1) capital to total adjusted tangible assets of 3.0%; and a minimum ratio of total capital (core capital and supplementary capital) to risk weighted assets of 8.0%, of which 4.0% must be core capital. Under the prompt corrective action regulations, the OTS is required to take certain supervisory actions (and may take additional discretionary actions) with respect to an undercapitalized institution. Such actions could have a direct material effect on an institution's financial statements. The regulations establish a framework for the classification of savings institutions into five categories: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized and critically undercapitalized. Generally, an institution is considered well capitalized if it has a core (Tier 1) capital ratio of at least 5.0% (based on average total assets); a core (Tier 1) risk-based capital ratio of at least 6.0%; and a total risk-based capital ratio of at least 10.0%. The foregoing capital ratios are based in part on specific quantitative measures of assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by the OTS about capital components, risk weightings and other factors. At September 30, 2000, FFY Bank met all capital adequacy requirements to which it was subject. Further, the most recent OTS notification categorized FFY Bank as a well-capitalized institution under the prompt corrective action regulations. There have been no conditions or events since that notification that management believes have changed FFY Bank's capital classification. Item 3. Quantitative and Qualitative Disclosures About Market Risk There were no material changes in information about market risk from that provided in the 2000 Annual Report to Shareholders, which was incorporated by reference into FFY Financial Corp.'s 2000 Annual Report on Form 10-K. PART II: OTHER INFORMATION FFY FINANCIAL CORP. SEPTEMBER 30, 2000 Item 1. Legal Proceedings The Company is involved as plaintiff or defendant in various legal actions arising in the normal course of business. While the ultimate outcome of these proceedings cannot be predicted with certainty, it is the opinion of management, after consultation with counsel representing the Company in the proceedings, that the resolution of these proceedings should not have a material effect on the Company's results of operations. Item 2. Changes in Securities None to be reported. Item 3. Defaults on Senior Securities None to be reported. Item 4. Submission of Matters to a Vote of Security Holders None to be reported. Item 5. Other Information None to be reported. Item 6. Exhibits and Reports on Form 8-K A. Exhibits: Exhibit 27 - Financial Data Schedule. B. Reports on Form 8-K: * On July 18, 2000, the Registrant announced the approval of the regular quarterly dividend of 12.5 cents per share. The Registrant also announced its Annual Meeting of Stockholders to be held on November 15, 2000. Also included in the July 18, 2000 Form 8-K filing, the Registrant announced on May 24, 2000 that it entered into a definitive merger agreement with First Place Financial Corp. to combine in a merger of equals. * On August 4, 2000, the Registrant announced earnings of $7.4 million, or $1.12 per diluted share for its fiscal year ended June 30, 2000 and earnings of $1.6 million, or $.24 for its fourth quarter ended June 30, 2000. Pursuant the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. FFY Financial Corp. Date: November 13, 2000 By: /s/ Jeffrey L. Francis ------------------------------- Jeffrey L. Francis President and Chief Executive Officer (Principal Executive Officer) Date: November 13, 2000 By: /s/ Therese Ann Liutkus ------------------------------- Therese Ann Liutkus Treasurer and Chief Financial Officer (Principal Financial and Accounting Officer)

FFY FINANCIAL CORP 10-Q