DCB Financial Announces 2002 Net Income of $4.0 Million

Loan Loss Reserve Increases to 1.10% of Loans from .99%

Feb 14, 2003, 00:00 ET from DCB Financial Corp

    DELAWARE, Ohio, Feb. 14 /PRNewswire-FirstCall/ -- DCB Financial Corp.
 (OTC: DCBF) today announced 2002 net income of $4.0 million, or $0.96 earnings
 per share, compared to $4.5 million, or $1.08 per share for the prior year.
 Income for the fourth quarter was $623 thousand, or $0.15 per share, compared
 to $688 thousand or $0.17 per share for the same period in 2001.
     Earnings for the quarter were negatively impacted by the decision to
 record a $1.25 million provision for loan losses, compared to the provision of
 $300 thousand in the fourth quarter of 2001. Jeffrey Benton, President and
 Chief Executive Officer commented, "We did experience some credit problems in
 our commercial lending portfolio during 2002.  The increased provision for
 loan losses is in response to those issues and also an ongoing evaluation of
 our existing loan portfolio and continued concern about the general weakness
 in the economy."
     The Company's allowance for loan losses has increased to $4.09 million or
 1.10% of total loans at December 31, 2002, from $3.59 million, or 0.99% of
 total loans at December 31, 2001.  This is a 10% increase from the prior year-
 end.  "We feel that we have properly increased the allowance for loan losses
 over the past few months to a level that is appropriate, noting the condition
 of our loan portfolio," Mr. Benton noted.  Continuing, Mr. Benton said
 "Management and the Board of Directors pledge to continue to diligently
 monitor the assets of the bank in order to best serve the interests of our
 shareholders and customers." Key credit quality indicators improved in the
 fourth quarter. The ratio of non-performing loans to total loans was 0.96% at
 December 31, 2002 compared to 1.23% at September 30, 2002. Delinquencies at
 December 31, 2002 were $7.58 million or 2.04% of the total loan portfolio,
 which is a decline of $1.92 million or 20.2% since September 2002. Net charge-
 off loans declined from $1.4 million in the third quarter 2002, to $581
 thousand in the fourth quarter, a decline of 58.5%.
     Mr. Benton also stated, "Many of our products and services experienced
 positive growth in volumes and profitability during the year.  Our loan
 portfolios continue to grow, and we remain very excited about our new branch
 office in the Sunbury area.  The community in Eastern Delaware County has been
 very supportive of our organization, and our new facilities will allow us to
 continue to service that area, and our entire geographic area with premier
 products and services."
     In addition, revenues associated with non-interest products and services
 increased by approximately 15%, led by revenue on loans sold in the secondary
 market which increased by $398 thousand to $1 million.  This increase was
 fueled by high mortgage refinancing activity caused by historically low
 mortgage rates linked to the softening economy.  Further, corporate services
 revenues increased by approximately $118 thousand or 31%, as corporate
 customers relied on the organization's cash management services to effectively
 manage their business activities.
     The DCB Board of Directors has declared a dividend of $0.09 per share
 payable on February 17, 2003 to shareholders of record on January 30, 2003.
 This compares to a dividend of $0.08 per share for the period ended
 December 31, 2001.
     DCB Financial Corp. is the parent company of The Delaware County Bank &
 Trust Company, which provides retail and commercial banking services and
 lending products to customers in Delaware, Ohio and its surrounding
 communities. The bank operates 16 retail branch locations.
     Forward-Looking Statements: This news release may be deemed to include
 forward-looking statements such as statements relating to financial goals,
 business outlook and credit quality. Actual results could differ materially
 from those indicated by these statements due to a variety of factors,
 including those related to the economic environment in the market areas in
 which the company operates, credit risk management, asset/liability management
 and the availability of and costs associated with sources of liquidity.

SOURCE DCB Financial Corp