EX-99.1 2 v100670_ex99-1.htm

Unassociated Document

Exhibit 99.1

Investor Contact: Valda Colbart, 419-784-2759, rfcinv@rurban.net

RURBAN FINANCIAL CORP. REPORTS FISCAL YEAR 2007 EARNINGS INCREASED 18% FROM PREVIOUS YEAR’S RESULTS

DEFIANCE, Ohio, January 23, 2008 — Rurban Financial Corp. (NASDAQ: RBNF), a leading provider of full-service community banking, investment management, trust services and bank data processing, reported 2007 earnings of $3.26 million, or $0.65 per diluted share, an increase of approximately 18% above the $2.76 million, or $0.55 per diluted share reported in 2006.

Fourth quarter 2007 earnings were $906,000, or $0.18 per diluted share, compared with fourth quarter 2006 earnings of $710,000, or $0.14 per diluted share, an increase of approximately 28%; compared with the third quarter of 2007, net income and earnings per share rose 4.9% and 5.9%, respectively.

Highlights of the year and fourth quarter 2007 include:

· During the first quarter of 2007, Rurban merged Reliance Financial Services, N.A., its trust and investment subsidiary, and The Exchange Bank, its recently acquired community bank, into The State Bank and Trust Company. This action has allowed efficiencies leading to continuing core profit improvement at The State Bank and Trust Company.

· State Bank continues to expand its reach to higher-growth markets. In January 2007, the Fort Wayne, Indiana loan production office was converted to a full-service branch. State Bank continued its entrance to growth markets by opening a loan production office in Columbus, Ohio in December, 2007.

· Loans increased 5.2%, or $19.2 million, over the course of the year, funded largely by cash and the liquidation of investment securities. As a result of this restructure, assets grew only 1% year-over-year to $561.2 million.

· RDSI and DCM, Rurban’s data and item processing subsidiaries, reported another record year. The total number of banks being process increased by 5 to 117. Revenue increased to $20.6 million, a $4.3 million, or 27% increase, over the previous year’s results. Net income was a record $2.5 million for the year.

· On April 12, 2007, Rurban initiated a stock repurchase program, authorizing the repurchase of up to 250,000 shares, or approximately 5%, of the Company’s outstanding shares. As of the end of the fourth quarter, Rurban repurchased 48,500 shares at an average cost of $12.58.

· Rurban increased its dividend to shareholders from $0.21 per share during 2006 to $0.26 per share in 2007.

“We are very encouraged with our growth in core earnings for both segments of our business, especially considering how difficult the banking environment has been for the past twelve months,” commented Mr. Joyce. “There are numerous factors that contributed to this growth; however, in the banking side of our business, the most significant determinants were loan growth, maintenance of our interest rate margin following a dip in mid-year, and expense control. We are also continuing our market expansion with the addition of the Columbus, Ohio market. We are very encouraged with the turnaround results from our banking business, and we are cautiously optimistic that this turnaround will continue, but banking is not immune to the economy.”

Joyce continued, “RDSI maintained its growth pattern reaching higher levels of revenue, net income, and number of client banks processed. The addition of DCM in September of 2006 also aided RDSI in attaining another record year. RDSI is now providing data and item processing in ten states to 117 client banks. We believe that 2008 provides RDSI and DCM the opportunity to continue on its established growth pattern.”

YTD RESULTS

Earnings:		Year Ended December 31
(Dollars in thousands except per share data)		2007			2006
Net interest income		$	14,787		$	15,034
Non-interest income			26,861			23,755
Total revenue			41,648			38,789
Provision for loan losses			521			178
Non-interest expense			36,637			34,904
Net income			3,257			2,760
Diluted EPS		$	0.65		$	0.55

Net interest income was $14.8 million for 2007 compared to $15.0 million for 2006, a decrease of 1.6%, which primarily resulted from margin compression. Average earning assets also decreased to $488.3 million in 2007 compared to $490.6 million in 2006 as a result of repositioning the balance sheet to improve the net interest margin. Over the past 12 months, the company was successful in converting lower yielding investments into a funding source for loan growth and converted higher cost deposits to core deposits and increased wholesale funding due to favorable rates.

Non-interest income was $26.9 million for 2007 compared to $23.8 million for 2006, representing a $3.1 million, or 13.1% increase year-over-year. Non-interest income in 2006 was increased a net $1.1 million from the one-time impact of a $495,000 charge taken to restructure the bond portfolio, an $889,000 recovery of losses previously recorded on WorldCom bonds, and a gain associated with the sale of the credit card portfolio of $740,000. Excluding these 2006 one-time items, non-interest income increased $4.2 million, or 18.7%, year-over-year. This increase was driven by a $4.4 million, or 29%, increase in data service fees, which were primarily attributable to the DCM acquisition.

Non-interest expense increased $1.7 million, or 4.9%, primarily from the additional expenses incurred within the Data Processing Group relating to the incorporation of full-year expenses from the DCM acquisition, which occurred in September of 2006. Data Processing Group expenses were $16.9 million in 2007 compared to $13.1 million in 2006. This $3.7 million increase in RDSI was partially offset by a $1.9 million improvement within our Banking Group. This non-interest expense reduction was primarily the result of reductions in professional fees associated with loan workouts and the reduction of 42 full-time positions within the company, of which 23 were part of the Banking Group. This significantly reduced compensation and employee benefits expense. This reduction was also aided by approximately $500,000 of one-time expenses taken in the fourth quarter of 2006 as detailed below.

FOURTH QUARTER RESULTS

Earnings:		Fourth Quarter Ended December 31
(Dollars in thousands except per share data)		2007			2006
Net interest income		$	3,783		$	3,584
Non-interest income			6,832			7,576
Revenue			10,615			11,160
Provision (credit) for loan losses			143			(159	)
Non-interest expense			9,164			10,359
Net income (loss)			906			710
Diluted EPS		$	0.18		$	0.14

Net interest income increased to $3.8 million for the quarter compared to $3.6 million for the fourth quarter of 2006. This 5.5% increase is due to an 18 basis point improvement in the banking segment’s net interest margin. This improvement in net interest margin was attributable to the balance sheet restructuring completed at year-end 2006 combined with aggressive pricing management for both loans and deposits.

Non-interest income totaled $6.8 million for 2007 and $7.6 million for 2006. Excluding the fourth quarter 2006 one-time net gain of $1.1 million discussed above, non-interest income was $6.4 million for 2006, up $390,000, or 6.1%. The data service fees contributed $216,000 of the $390,000 fee increase. In addition, trust fees and deposit fees increased 5.1% and 13%, respectively.

Non-interest expense for the year-over-year fourth quarter decreased $1.2 million, or 11.5%. As previously mentioned, the company eliminated 42 full-time positions across all business segments, which decreased fourth quarter 2007 compensation, benefits and other employee related expenses by $543,000, or 11.6%, compared to fourth quarter 2006. The remaining reductions over 2006 resulted from lower professional fees of $284,000 from litigation costs. The fourth quarter of 2006 also contained one-time expenses of approximately $500,000, which included $215,000 for FHLB prepayment penalties and $283,000 for merger related charges.

CONSOLIDATED BALANCE SHEET

Total assets at December 31, 2007 totaled $561.2 million showing a nominal increase over $556.0 million at December 31, 2006. At December 31, 2007, gross loans totaled $389.3 million, deposits totaled $406.0 million and shareholders equity was $59.3 million. At December 31, 2006 loans, deposits and equity were $370.1 million, $414.6 million, and $57.0 million, respectively.

BANK OPERATING RESULTS

Mr. Joyce commented, “We repositioned our balance sheet and reduced expenses dramatically within our Banking Group during 2007. The result was an improvement of 26 basis points to 61 basis points Return on Assets for the fourth quarter of 2007, compared to the fourth quarter of 2006. This improvement in “run rate” of ROA was accomplished despite the substantial one-time favorable income items in the fourth quarter of 2006, as stated in our analysis above. We made several changes in structure and function in 2007 thereby improving our core earnings, including additional efficiencies on the bank side that were executed in the fourth quarter of 2007. We will be working to continue growing our loan balances in 2008 while maintaining a tight control on expenses. We recognize that further improvement is necessary. We believe we have the right banking model in place, and we are beginning to execute that model very effectively.”

Net income for the Banking Group was $2.9 million for 2007 compared with $1.9 million reported for the prior fiscal year. On a linked quarter basis, net income increased by $162,000, or 24%.

Total loans were $390.5 million at December 31, 2007, up $18.3 million, or 4.9%. Commercial real estate was the only category that had significant growth during 2007, up $31.8 million, or 34.7%, to $123.5 million. This growth was partially offset by a decline of $4.9 million in C&I and $8.1 million in residential mortgages. Commercial loans now account for 64.5% of total loans compared with 60.0% at the prior year-end. As part of a continuing initiative to improve profitability, $9.8 million of lower-yielding securities were liquidated during the year to fund loan growth.

Total deposits at December 31, 2007 were $406.0 million, down $8.5 million, or 2.1%, from the December 31, 2006 year-end. The decrease during the year resulted from Time Deposits decreasing $14.2 million and Demand Deposits decreasing $5.0 million. These decreases were offset by a $10.7 million increase in NOW accounts, savings accounts, and money market accounts. The High Performance Checking account promotion the company started in April of 2007 generated $4.5 million in new retail checking account balances at a funding cost of 1.20%. The decrease in Demand Deposits was due to customers shifting balances into higher-yielding products. The decrease in Time Deposits was due to planned runoff of higher-costing municipal deposits, which was part of the balance sheet restructure.

ASSET QUALITY

Provision for Loan Losses of $521,000 was taken in 2007 compared to $178,000 taken for 2006. The 2006 provision was reduced by the release of $140,000 provision associated with the credit card portfolio sold at the end of 2006. The fourth quarter loan loss provision of $142,000 represents a normal accrual for the company given our loan growth and net charge-offs of $89,000, or .09%, of average loans.

		Quarter Ended									YTD
Asset Quality (Dollars in Thousands)		December, 2007			September, 2007			December, 2006			2007			2006
Net charge-offs		$	89		$	28		$	645		$	248		$	1,200
Net charge-offs (Ann.) / Avg. loans			0.09	%		0.03	%		.70	%		.07	%		.33	%
Allowance for loan loss		$	3,990		$	3,937		$	3,717
Allowance for loan loss / Loans			1.03	%		1.01	%		1.00	%
Non-performing assets		$	6,162		$	6,432		$	3,910
NPA / Total assets			1.10	%		1.14	%		.70	%

Non-performing assets (loans + OREO + OAO) were $6.2 million, or 1.10 %, of total assets at December 31, 2007, a decrease of $270,000 from the linked quarter, and an increase of $2.3 million from a year-ago. This increase, which originated in the second quarter of 2007, is due to three commercial loan relationships that are being worked out with minimal, if any, expected loss.

RDSI AND DCM RESULTS

Revenue for the Data and Item Processing Group was $20.6 million, up $4.3 million, or 27.0%, over the $16.6 million reported for year-end 2006. DCM, acquired in September, 2006, accounted for $2.9 million of the $4.3 million in fee growth. RDSI continues growing its client banks, servicing 117 community banks at year-end 2007 compared to 112 at year-end 2006. RDSI has contracts signed for six additional new banks that will be converted by June, 2008.

Net Income for the 2007 fiscal year was $2.5 million compared to $1.9 million for 2006, up $586,000, or 31%. “We are very pleased with the growth we obtained in 2007 and we continue to see a solid pipeline of signed and potential customers for both our data processing and item processing services in 2008,” said Mr. Joyce.

Mr. Joyce concluded, “We have seen in this past year a clear transition to improving core earnings in both the banking and data and item processing business segments. The improved run rates in both of these segments indicate continuing growth in 2008. We will be working hard to achieve the maximum growth and profitability for Rurban Financial Corp. and its shareholders.”

ABOUT RURBAN FINANCIAL CORP.

Rurban Financial Corp. is a publicly-held financial services holding company based in Defiance, Ohio with assets of $561.2 million as of December 31, 2007. Rurban's wholly-owned subsidiaries are The State Bank and Trust Company, including Reliance Financial Services; Rurbanc Data Services, Inc. (RDSI); and DCM. The State Bank and Trust Company offers financial services through its 18 branches in Allen, Defiance, Franklin, Fulton, Lucas, Paulding and Wood Counties, Ohio and Allen County, Indiana. Reliance Financial Services, a division of the Bank, offers a diversified array of trust and financial services to customers throughout the Midwest. RDSI and DCM provide data and item processing services to community banks in Arkansas, Florida, Illinois, Indiana, Michigan, Missouri, Nebraska, Nevada, Ohio and Wisconsin. Rurban's common stock is quoted on the NASDAQ Global Market under the symbol RBNF. The Company currently has 10,000,000 shares of stock authorized and 4,978,933 shares outstanding. The Company's website is http://www.rurbanfinancial.net.

FORWARD-LOOKING STATEMENTS

Certain statements within this document, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties and actual results may differ materially from those predicted by the forward-looking statements. These risks and uncertainties include, but are not limited to, risks and uncertainties inherent in the national and regional banking, insurance and mortgage industries, competitive factors specific to markets in which Rurban and its subsidiaries operate, future interest rate levels, legislative and regulatory actions, capital market conditions, general economic conditions, geopolitical events, the loss of key personnel and other factors.

Forward-looking statements speak only as of the date on which they are made, and Rurban undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made. All subsequent written and oral forward-looking statements attributable to Rurban or any person acting on our behalf are qualified by these cautionary statements.

RURBAN FINANCIAL CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

December 31, 2007 and December 31, 2006

		December			December
		2007			2006
		(Unaudited)
ASSETS
Cash and due from banks		$	15,183,627		$	13,381,791
Federal funds sold			2,000,000			9,100,000
Cash and cash equivalents			17,183,627			22,481,791
Interest-earning deposits in other financial institutions			-			150,000
Available-for-sale securities			92,661,386			102,462,075
Loans held for sale			1,649,758			390,100
Loans, net of unearned income			389,268,744			370,101,809
Allowance for loan losses			(3,990,455	)		(3,717,377	)
Premises and equipment, net			15,143,201			15,449,774
Purchased software			4,268,116			4,618,691
Federal Reserve and Federal Home Loan Bank Stock			4,021,200			3,993,450
Foreclosed assets held for sale, net			124,131			82,397
Accrued interest receivable			3,008,968			3,129,774
Goodwill			13,940,618			13,674,058
Core deposits and other intangibles			5,135,228			5,858,982
Cash value of life insurance			12,160,581			10,771,843
Other assets			6,638,895			6,559,886
Total assets		$	561,213,998		$	556,007,253
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Deposits
Demand		$	41,541,297		$	46,565,554
Savings, interest checking and money market			141,009,043			130,267,333
Time			223,480,842			237,722,558
Total deposits			406,031,182			414,555,445
Notes payable			922,457			2,589,207
Advances from Federal Home Loan Bank			24,000,000			21,000,000
Repurchase Agreements			43,006,438			32,270,900
Trust preferred securities			20,620,000			20,620,000
Accrued interest payable			2,532,914			2,224,413
Other liabilities			4,775,773			5,792,135
Total liabilities			501,888,764			499,052,100
Shareholders' Equity
Common stock			12,568,583			12,568,583
Additional paid-in capital			14,923,571			14,859,165
Retained earnings			32,361,106			30,407,298
Accumulated other comprehensive income (loss)			82,235			(879,893	)
Treasury stock			(610,260	)		-
Total shareholders' equity			59,325,234			56,955,153
Total liabilities and shareholders' equity		$	561,213,998		$	556,007,253

RURBAN FINANCIAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

For The Twelve Months Ended December 31, 2007 and 2006

		Twelve Months			Twelve Months			Increase/(Decrease)
		2007			2006			$
Interest income
Loans
Taxable		$	27,782,068		$	24,958,988		$	2,823,080
Tax-exempt			73,451			63,356			10,095
Securities
Taxable			4,283,508			5,211,672			(928,164	)
Tax-exempt			645,451			559,518			85,933
Other			225,151			176,884			48,267
Total interest income			33,009,629			30,970,418			2,039,211
Interest expense
Deposits			13,595,896			11,022,161			2,573,735
Other borrowings			165,859			172,130			(6,271	)
Repurchase Agreements			1,615,016			848,277			766,739
Federal Home Loan Bank advances			1,037,026			2,106,385			(1,069,359	)
Trust preferred securities			1,808,520			1,787,023			21,497
Total interest expense			18,222,317			15,935,976			2,286,341
Net interest income			14,787,312			15,034,442			(247,130	)
Provision for loan losses			521,306			177,838			343,468
Net interest income after provision
for loan losses			14,266,006			14,856,604			(590,598	)
Non-interest income
Data service fees			19,382,115			15,011,143			4,370,972
Trust fees			3,385,320			3,192,025			193,295
Customer service fees			2,243,745			2,161,153			82,592
Net gain on sales of loans			574,000			1,310,536			(736,536	)
Net realized gain (loss) on sales of
available-for-sale securities			1,998			(494,885	)		496,883
Investment securities recoveries			-			889,454			(889,454	)
Loan servicing fees			227,017			358,321			(131,304	)
Gain on sale of assets			29,477			94,198			(64,721	)
Other income			1,017,727			1,233,376			(215,649	)
Total non-interest income			26,861,399			23,755,321			3,106,078
Non-interest expense
Salaries and employee benefits			17,007,314			16,584,146			423,168
Net occupancy expense			2,134,950			1,840,864			294,086
Equipment expense			6,586,623			5,850,281			736,342
Data processing fees			469,808			562,265			(92,457	)
Professional fees			2,226,577			2,395,863			(169,286	)
Marketing expense			820,528			669,764			150,764
Printing and office supplies			661,760			619,100			42,660
Telephone and communication			1,781,277			1,705,261			76,016
Postage and delivery expense			1,545,340			735,210			810,130
State, local and other taxes			584,031			674,280			(90,249	)
Employee expense			1,083,056			978,832			104,224
FHLB prepayment penalties			-			214,886			(214,886	)
Other expenses			1,735,346			2,072,815			(337,469	)
Total non-interest expense			36,636,610			34,903,567			1,733,043
Income before income tax expense			4,490,795			3,708,358			782,437
Income tax expense			1,234,160			948,116			286,044
Net income		$	3,256,635		$	2,760,242		$	496,393
Earnings per common share:
Basic		$	0.65		$	0.55		$	0.10
Diluted		$	0.65		$	0.55		$	0.10

RURBAN FINANCIAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

For The Three Months Ended December 31, 2007 and 2006

		Fourth Quarter			Fourth Quarter			Increase/(Decrease)
		2007			2006			$
Interest income
Loans
Taxable		$	7,056,261		$	6,720,398		$	335,863
Tax-exempt			22,240			17,638			4,602
Securities
Taxable			1,106,834			1,258,234			(151,400	)
Tax-exempt			161,830			149,172			12,658
Other			61,257			77,726			(16,469	)
Total interest income			8,408,422			8,223,168			185,254
Interest expense
Deposits			3,383,225			3,326,774			56,451
Other borrowings			25,215			51,910			(26,695	)
Retail Repurchase Agreements			484,118			382,717			101,401
Federal Home Loan Bank advances			276,492			421,970			(145,478	)
Trust preferred securities			456,427			455,408			1,019
Total interest expense			4,625,477			4,638,779			(13,302	)
Net interest income			3,782,945			3,584,389			198,556
Provision for loan losses			142,663			(159,483	)		302,146
Net interest income after provision
for loan losses			3,640,282			3,743,872			(103,590	)
Non-interest income
Data service fees			4,914,328			4,698,386			215,942
Trust fees			873,069			830,898			42,171
Customer service fees			593,665			525,881			67,784
Net gain on sales of loans			137,611			856,344			(718,733	)
Net realized gain (loss) on sales of
available-for-sale securities			1,631			(494,885	)		496,516
Investment securities recoveries			-			889,454			(889,454	)
Loan servicing fees			80,590			95,447			(14,857	)
Gain (loss) on sale of assets			(32,362	)		8,852			(41,214	)
Other income			263,583			165,637			97,946
Total non-interest income			6,832,115			7,576,014			(743,899	)
Non-interest expense
Salaries and employee benefits			4,134,242			4,677,237			(542,995	)
Net occupancy expense			587,150			506,142			81,008
Equipment expense			1,678,311			1,681,747			(3,436	)
Data processing fees			97,092			159,604			(62,512	)
Professional fees			586,327			870,464			(284,137	)
Marketing expense			218,549			132,787			85,762
Printing and office supplies			151,943			165,990			(14,047	)
Telephone and communication			451,918			427,554			24,364
Postage and delivery expense			376,777			337,993			38,784
State, local and other taxes			115,441			161,523			(46,082	)
Employee expense			281,682			233,491			48,191
FHLB prepayment penalties			-			214,886			(214,886	)
Other expenses			485,154			789,587			(304,433	)
Total non-interest expense			9,164,586			10,359,005			(1,194,419	)
Income before income tax expense			1,307,811			960,881			346,930
Income tax expense			402,275			250,448			151,827
Net income		$	905,536		$	710,433		$	195,103
Earnings per common share:
Basic		$	0.18		$	0.14		$	0.04
Diluted		$	0.18		$	0.14		$	0.04

RURBAN FINANCIAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

For The Three Months Ended December 31, 2007 and September 30, 2007

		Fourth Quarter			Third Quarter			Increase/(Decrease)
		2007			2007			$
Interest income
Loans
Taxable		$	7,056,261		$	7,072,488		$	(16,227	)
Tax-exempt			22,240			16,668			5,572
Securities
Taxable			1,106,834			1,041,177			65,657
Tax-exempt			161,830			169,719			(7,889	)
Other			61,257			50,288			10,969
Total interest income			8,408,422			8,350,340			58,082
Interest expense
Deposits			3,383,225			3,497,275			(114,050	)
Other borrowings			25,215			32,026			(6,811	)
Retail Repurchase Agreements			484,118			435,216			48,902
Federal Home Loan Bank advances			276,492			268,289			8,203
Trust preferred securities			456,427			456,582			(155	)
Total interest expense			4,625,477			4,689,389			(63,912	)
Net interest income			3,782,945			3,660,951			121,994
Provision for loan losses			142,663			140,409			2,254
Net interest income after provision
for loan losses			3,640,282			3,520,543			119,739
Non-interest income
Data service fees			4,914,328			5,004,394			(90,066	)
Trust fees			873,069			819,989			53,080
Customer service fees			593,665			588,447			5,218
Net gain on sales of loans			137,611			128,947			8,664
Net realized gains on sales of
available-for-sale securities			1,631			-			1,631
Loan servicing fees			80,590			27,284			53,306
Gain (loss) on sale of assets			(32,362	)		11,862			(44,224	)
Other income			263,583			201,920			61,663
Total non-interest income			6,832,115			6,782,842			49,273
Non-interest expense
Salaries and employee benefits			4,134,242			4,290,961			(156,719	)
Net occupancy expense			587,150			514,742			72,408
Equipment expense			1,678,311			1,625,762			52,549
Data processing fees			97,092			102,292			(5,200	)
Professional fees			586,327			461,844			124,483
Marketing expense			218,549			259,196			(40,647	)
Printing and office supplies			151,943			130,363			21,580
Telephone and communication			451,918			446,465			5,453
Postage and delivery expense			376,777			392,211			(15,434	)
State, local and other taxes			115,441			103,674			11,767
Employee expense			281,682			266,227			15,455
Other expenses			485154			512,663			(27,509	)
Total non-interest expense			9,164,586			9,106,400			58,186
Income before income tax expense			1,307,811			1,196,985			110,826
Income tax expense			402,275			333,384			68,891
Net income		$	905,536		$	863,601		$	41,935
Earnings per common share:
Basic		$	0.18		$	0.17		$	0.01
Diluted		$	0.18		$	0.17		$	0.01

RURBAN FINANCIAL CORP.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)
		4th Qtr			YTD			4th Qtr			YTD
(dollars in thousands except per share data)		2007			2007			2006			2006
EARNINGS
Net interest income		$	3,783		$	14,787		$	3,584		$	15,034
Provision for loan loss		$	143		$	521		$	(159	)	$	178
Non-interest income		$	6,832		$	26,861		$	7,576		$	23,755
Revenue (net interest income plus non-interest income)		$	10,615		$	41,648		$	11,160		$	38,789
Non-interest expense		$	9,164		$	36,636		$	10,359		$	34,904
Net income		$	906		$	3,257		$	710		$	2,760
PER SHARE DATA
Basic earnings per share		$	0.18		$	0.65		$	0.14		$	0.55
Diluted earnings per share		$	0.18		$	0.65		$	0.14		$	0.55
Book value per share		$	11.92		$	11.92		$	11.33		$	11.33
Tangible book value per share		$	8.00		$	8.00		$	7.58		$	7.58
Cash dividend per share		$	0.07		$	0.26		$	0.06		$	0.21
PERFORMANCE RATIOS
Return on average assets			0.64	%		0.59	%		0.50	%		0.50	%
Return on average equity			6.15	%		5.62	%		5.08	%		5.06	%
Net interest margin (tax equivalent)			3.12	%		3.10	%		2.92	%		3.13	%
Net interest margin (Bank Only)			3.43	%		3.46	%		3.25	%		3.62	%
Non-interest expense / Average assets			6.48	%		6.58	%		7.27	%		6.30	%
Efficiency Ratio - bank (non-GAAP)			76.93	%		80.07	%		94.85	%		88.20	%
MARKET DATA PER SHARE
Market value per share -- Period end		$	12.49		$	12.49		$	10.77		$	10.77
Market as a % of book			105	%		105	%		95	%		95	%
Cash dividend yield			2.24	%		2.08	%		2.23	%		1.95	%
Period-end common shares outstanding (000)			4,979			4,979			5,027			5,027
Common stock market capitalization ($000)		$	62,188		$	62,188		$	54,145		$	54,145
CAPITAL & LIQUIDITY
Equity to assets			10.6	%		10.6	%		10.2	%		10.2	%
Period-end tangible equity to assets			7.1	%		7.1	%		6.9	%		6.9	%
Tier 1 risk-based capital ratio			14.8	%		14.8	%		14.7	%		14.7	%
Total risk-based capital ratio			16.0	%		16.0	%		15.8	%		15.8	%
ASSET QUALITY
Net charge-offs / (Recoveries)		$	89		$	248		$	645		$	1,160
Net loan charge-offs (Ann.) / Average loans			0.09	%		0.07	%		0.70	%		0.33	%
Non-performing loans		$	5,990		$	5,990		$	3,828		$	3,828
OREO / OAOs		$	172		$	172		$	82		$	82
Non-performing assets		$	6,162		$	6,162		$	3,910		$	3,910
Non-performing assets / Total assets			1.10	%		1.10	%		0.70	%		0.70	%
Allowance for loan losses / Total loans			1.03	%		1.03	%		1.00	%		1.00	%
Allowance for loan losses / Non-performing Assets			64.8	%		64.8	%		95.1	%		95.1	%
END OF PERIOD BALANCES
Total loans, net of unearned income		$	389,269		$	389,269		$	370,102		$	370,102
Allowance for loan loss		$	3,990		$	3,990		$	3,717		$	3,717
Total assets		$	561,214		$	561,214		$	556,007		$	556,007
Deposits		$	406,031		$	406,031		$	414,555		$	414,555
Stockholders' equity		$	59,325		$	59,325		$	56,955		$	56,955
Full-time equivalent employees			275			275			317			317
AVERAGE BALANCES
Loans		$	389,529		$	381,453		$	370,687		$	354,400
Total earning assets		$	496,782		$	488,289		$	502,530		$	490,550
Total assets		$	565,779		$	556,572		$	569,807		$	554,095
Deposits		$	413,473		$	412,767		$	415,576		$	413,338
Stockholders' equity		$	58,928		$	57,945		$	55,963		$	54,501

Rurban Financial Corp.

Segment Reporting

Fourth Quarter Ended December 31, 2007

		State Bank and Trust			RFCBC (Loan Workout Company)			Total Banking			Data Processing			Parent Company and Other			Elimination Entries			Rurban Financial Corp.
Income Statement Measures
Interest Income		$	8,437		$	-		$	8,437		$	-		$	1		$	(30	)	$	8,408
Interest Expense			4,150			-			4,150			48			457			(30	)	$	4,625
Net Interest Income			4,287			-			4,287			(48	)		(456	)		-		$	3,783
Provision For Loan Loss			151			(8	)		143			-			-			-		$	143
Non-interest Income			1,945			-			1,945			5,232			342			(687	)	$	6,832
Non-interest Expense			4,750			158			4,908			4,202			741			(687	)	$	9,164
Net Income Before Taxes			1,331			(150	)		1,181			982			(855	)		-		$	1,308
Income Taxes			397			(52	)		345			334			(277	)		-		$	402
Net Income QTD		$	934		$	(98	)	$	836		$	648		$	(578	)	$	-		$	906
Performance Measures
Average  Assets -QTD		$	545,299		$	1,311		$	546,609		$	20,014		$	80,827		$	(81,671	)	$	565,779
ROAA			0.69	%		-			0.61	%		12.95	%		-			-			0.64	%
Average Equity - QTD		$	56,882		$	1,234		$	58,115		$	15,222		$	58,928		$	(73,337	)	$	58,928
ROAE			6.57	%		-			5.75	%		17.03	%		-			-			6.15	%
Efficiency Ratio - %			74.39	%		-			76.93	%		79.77	%		-			-			84.63	%
Average Loans - QTD		$	390,599		$	555		$	391,154		$	-		$	-		$	(1,624	)	$	389,529
Average Deposits - QTD		$	420,192		$	-		$	420,192		$	-		$	-		$	(6,718	)	$	413,473

Rurban Financial Corp.

Segment Reporting

Twelve Months Ended December 31, 2007

		State Bank and Trust			RFCBC (Loan Workout Company)			Total Banking			Data Processing			Parent Company and Other			Elimination Entries			Rurban Financial Corp.
Income Statement Measures
Interest Income		$	33,158		$	1		$	33,159		$	1		$	5		$	(155	)	$	33,010
Interest Expense			16,299			-			16,299			269			1,809			(155	)		18,223
Net Interest Income			16,859			1			16,860			(268	)		(1,804	)		-			14,787
Provision For Loan Loss			550			(29	)		521			-			-			-			521
Non-interest Income			7,476			-			7,476			20,888			1,393			(2,896	)		26,861
Non-interest Expense			19,249			579			19,828			16,873			2,832			(2,896	)		36,636
Net Income Before Taxes			4,536			(549	)		3,987			3,747			(3,243	)		-			4,491
Income Taxes			1,263			(187	)		1,076			1,274			(1,116	)		-			1,234
Net Income YTD		$	3,273		$	(362	)	$	2,911		$	2,473		$	(2,127	)	$	-		$	3,257
Performance Measures
Average  Assets - YTD		$	536,059		$	1,526		$	537,585		$	20,211		$	79,691		$	(80,916	)	$	556,572
ROAA			0.61	%		-			0.54	%		12.24	%		-			-			0.59	%
Average Equity - YTD		$	55,543		$	1,337		$	56,879		$	14,426		$	57,945		$	(71,305	)	$	57,945
ROAE			5.89	%		-			6.82	%		17.14	%		-			-			5.62	%
Efficiency Ratio - %			77.20	%		-			80.07	%		80.56	%		-			-			86.23	%
Average Loans - YTD		$	382,836		$	581		$	383,417		$	-		$	-		$	(1,965	)	$	381,453
Average Deposits - YTD		$	420,410		$	-		$	420,410		$	-		$	-		$	(7,642	)	$	412,767

Rurban Financial Corp.
Proforma Performance Measurement
Quarterly Comparison - Fourth Quarter 2007
		State Bank and Trust			RFCBC (Loan Workout Company)			Banking Related Entities			RDSI			Parent Company and Other			Intersegment Elimination Entries			Rurban Financial Corp.
Average Assets
4Q07		$	545,299		$	1,311		$	546,609		$	20,014		$	80,827		$	(81,671	)	$	565,779
3Q07		$	535,129		$	1,341		$	536,470		$	19,739		$	79,380		$	(80,137	)	$	555,451
2Q07		$	529,071		$	1,547		$	530,618		$	20,320		$	78,908		$	(80,420	)	$	549,426
1Q07		$	534,629		$	1,914		$	536,543		$	20,217		$	79,251		$	(81,380	)	$	554,631
4Q06		$	549,777		$	2,178		$	551,955		$	19,695		$	78,234		$	(80,077	)	$	569,807
4th Quarter Comparison		$	(4,478	)	$	(867	)	$	(5,346	)	$	319		$	2,593		$	-		$	(4,028	)
Revenue
4Q07		$	6,232		$	-		$	6,232		$	5,184		$	(114	)	$	(687	)	$	10,615
3Q07		$	5,939		$	-		$	5,939		$	5,332		$	(100	)	$	(727	)	$	10,444
2Q07		$	6,130		$	-		$	6,130		$	4,949		$	(82	)	$	(739	)	$	10,258
1Q07		$	6,024		$	1		$	6,025		$	5,155		$	(116	)	$	(732	)	$	10,332
4Q06		$	6,345		$	124		$	6,469		$	4,944		$	247		$	(500	)	$	11,160
4th Quarter Comparison		$	(113	)	$	(124	)	$	(237	)	$	240		$	(361	)	$	-		$	(545	)
Non-interest Expenses
4Q07		$	4,750		$	158		$	4,908		$	4,202		$	741		$	(687	)	$	9,164
3Q07		$	4,805		$	69		$	4,874		$	4,334		$	626		$	(727	)	$	9,106
2Q07		$	4,712		$	137		$	4,849		$	4,228		$	728		$	(739	)	$	9,065
1Q07		$	4,973		$	215		$	5,188		$	4,109		$	736		$	(732	)	$	9,301
4Q06		$	5,747		$	278		$	6,025		$	4,026		$	822		$	(514	)	$	10,359
4th Quarter Comparison		$	(997	)	$	(120	)	$	(1,117	)	$	176		$	(81	)	$	-		$	(1,195	)
Net Income
4Q07		$	934		$	(98	)	$	836		$	648		$	(578	)	$	-		$	906
3Q07		$	714		$	(39	)	$	674		$	659		$	(470	)	$	-		$	864
2Q07		$	917		$	(87	)	$	830		$	476		$	(521	)	$	-		$	785
1Q07		$	707		$	(136	)	$	571		$	690		$	(559	)	$	-		$	702
4Q06		$	569		$	(89	)	$	480		$	606		$	(376	)	$	-		$	710
4th Quarter Comparison		$	365		$	(9	)	$	356		$	42		$	(202	)	$	-		$	196
Efficiency Ratio
4Q07			74.39	%		-			76.93	%		79.77	%		-			-			84.63	%
3Q07			79.00	%		-			80.17	%		80.04	%		-			-			85.47	%
2Q07			74.99	%		-			77.23	%		84.09	%		-			-			86.61	%
1Q07			82.20	%		-			85.47	%		78.52	%		-			-			88.33	%
4Q06			88.78	%		-			91.37	%		80.40	%		-			-			91.34	%
4th Quarter Comparison			(14.39	%)		-			(14.44	%)		(0.63	%)		-			-			(6.71	%)
NPA/Total Assets
4Q07			1.04	%		-			-			-			-			-			1.10	%
3Q07			1.07	%		-			-			-			-			-			1.14	%
2Q07			1.03	%		-			-			-			-			-			1.09	%
1Q07			0.66	%		-			-			-			-			-			0.75	%
4Q06			0.61	%		-			-			-			-			-			0.70	%
4th Quarter Comparison			0.43	%		-			-			-			-			-			0.40	%
ROAA
4Q07			0.69	%		-			0.61	%		12.95	%		-			-			0.64	%
3Q07			0.53	%		-			0.50	%		13.35	%		-			-			0.62	%
2Q07			0.69	%		-			0.63	%		9.37	%		-			-			0.57	%
1Q07			0.53	%		-			0.43	%		13.65	%		-			-			0.51	%
4Q06			0.41	%		-			0.35	%		12.31	%		-			-			0.50	%
4th Quarter Comparison			0.28	%		-			0.26	%		0.64	%		-			-			0.14	%
ROAE
4Q07			6.57	%		-			5.75	%		17.03	%		-			-			6.15	%
3Q07			5.14	%		-			4.75	%		17.89	%		-			-			5.97	%
2Q07			6.68	%		-			5.90	%		13.43	%		-			-			5.45	%
1Q07			5.16	%		-			4.05	%		20.63	%		-			-			4.91	%
4Q06			4.20	%		-			3.43	%		19.06	%		-			-			5.08	%
4th Quarter Comparison			2.37	%		-			2.32	%		(2.03	%)		-			-			1.07	%
Average Equity
4Q07		$	56,882		$	1,234		$	58,115		$	15,222		$	58,928		$	(73,337	)	$	58,928
3Q07		$	55,534		$	1,271		$	56,805		$	14,732		$	57,830		$	(71,536	)	$	57,830
2Q07		$	54,905		$	1,344		$	56,249		$	14,182		$	57,617		$	(70,431	)	$	57,617
1Q07		$	54,828		$	1,502		$	56,330		$	13,378		$	57,192		$	(69,708	)	$	57,192
4Q06		$	54,249		$	1,714		$	55,963		$	12,721		$	55,963		$	(68,684	)	$	55,963
4th Quarter Comparison		$	2,633		$	(480	)	$	2,152		$	2,501		$	2,965		$	-		$	2,965