DCB Financial Corp Announces Second Quarter Earnings

    LEWIS CENTER, Ohio, July 22 /PRNewswire-FirstCall/ -- DCB Financial Corp,
 (OTC Bulletin Board:   DCBF) announced earnings of $0.65 per share for the three
 months ended June 30, 2004. The increase in earnings from the first quarter
 2004's $0.33 per share is mainly attributed to the previously announced sale
 of DCBF's investment in ProCentury during April 2004.
     "DCB was able to take advantage of the large gain from the sale of
 ProCentury by restructuring long-term Federal Home Loan Bank debt,
 amortization on some large pre-paid items, and reducing some other non-earning
 balance sheet items," said Jeff Benton, President and CEO. "We also were able
 to increase our allowance for loan and lease losses to keep pace with the
 outstanding loan growth we've experienced during 2004." Benton added, "We've
 really concentrated on growing future earnings in order to reach our goal of
 becoming a high performance bank. Reducing high-cost debt and removing
 non-earning assets from the balance sheet will help us achieve that goal."
     The Bank reached a new high in total loans of $438.4 million at the end of
 the second quarter compared to $388.0 million at the end of the second quarter
 2003, representing 13% annual growth.  Total loans are up $33 million or an
 annualized 16.5% from year-end 2003, while the allowance for loan and lease
 losses ended the quarter at 104 basis points. Despite the strong loan growth,
 credit quality showed improvement. Non-accrual loans declined to $1.9 million
 at June 30, 2004 from $2.9 million at the end of the second quarter 2003.
 Additionally, annualized net charge-offs for the quarter were 26 basis points
 compared to 30 basis points for the same period 2003. Delinquent loans over
 30 days remained stable period to period, increasing slightly to 2.0% from
     Net interest income was $4.6 million for the three months ended
 June 30, 2004, compared to $4.8 million for the same period in 2003. The
 approximate $200 thousand decrease was mainly attributed to reduced margins
 due to the sluggish interest rate environment, and to the accelerated
 amortization of dealer reserve expense. The Company's net interest margin
 declined to 3.70% on average earning assets of $570.6 million. This compares
 to 4.06% for the three months ended June 30, 2003.
     Total non-interest expense declined to $4.3 million from $4.5 million or
 4.4%, for the current period ended June 30, 2004, compared to the same period
 in 2003. The reduction was primarily the result of a decrease in salaries and
 benefits expenses, and a drop in professional and legal fees.
     The Board of Directors has declared a dividend of $0.11 per share payable
 August 16, 2004 to shareholders of record as of July 30, 2004.

SOURCE DCB Financial Corp

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