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U & I Financial Corp. Reports Second Quarter 2018 Results

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Year to Date Net Income Increases 42% from the Prior Year

U & I Financial Corp. (OTC:UNIF), the holding company for UniBank,
today reported year to date net income of $2.2 million or $0.39 per
share for the quarter ending June 30, 2018, as compared to $1.5 million
or $0.30 per share for the year earlier period. The year to date net
income increased $639 thousand or 42% from the prior year.

As compared to June 30, 2017, total assets increased by $55.0 million
(24%) to $288.5 million in 2018 fueled by both loans growth of $45.9
million (29%) to $202.1 million and deposits growth of $42.6 million
(22%) to $236.9 million.

"We are very pleased with the year to date results. The Bank has
rebounded from the challenges from the prior year caused by the failed
merger, and have continued to build momentum after finishing strong last
year. We credit this turnaround to our very talented staff, a
knowledgeable and supportive board, and our faithful shareholders. We
look forward to continue rewarding our shareholders with excellent
results," said Peter Park, President and CEO of UniBank.

2018 Second Quarter Highlights

Total assets grew 24% to $288.5 million as compared to $233.5 million a
year ago.

Total loans, net of provision, grew 29% to $202.1 million as compared to
$156.2 million a year ago.

Total deposits grew 22% to $236.9 million as compared to $194.3 million
a year ago.

Net income year to date grew 42% to $2.2 million as compared to $1.5
million one year ago.

Net income for the quarter grew 16% to $1.3 million as compared to $1.1
million one year ago.

Net interest income grew 31% to $2.8 million for the quarter as compared
to $2.1 million one year ago.

Net interest margin was 4.29% for the quarter as compared to 3.86% one
year ago.

Gain on sale of SBA loans was $908 thousand year to date as compared to
$311 thousand a year ago.

Return on average equity for the quarter was 12.99% as compared to
11.91% a year ago.

Nonperforming assets to total assets was 0.47% as compared to 0.68% a
year ago.

The efficiency ratio (noninterest expense divided by revenue) was 50.39%
for the quarter as compared to 61.51% a year ago.

About U & I Financial Corp.

UniBank, the wholly-owned subsidiary of U & I Financial Corp. (OTC Pink: UNIF), is one of the highest performing banks in Washington state in
terms of return on assets. Based in Lynnwood, Washington, the bank was
founded in 2006 to serve the small to medium-sized businesses,
professionals, and residents with a particular emphasis on Korean and
other ethnic minority communities. Customers can access their accounts
in any of the 4 branches – Lynnwood, Bellevue, Federal Way and Tacoma –
online, or through the Bank's ATM network.

For more information visit www.unibankusa.com
or call (425) 275-9700.

Forward-Looking Statement Safe Harbor: This news release contains
comments or information that constitutes forward-looking statements
(within the meaning of the Private Securities Litigation Reform Act of
1995) that are based on current expectations that involve a number of
risks and uncertainties. Forward-looking statements describe UniBank's
projections, estimates, plans and expectations of future results and can
be identified by words such as "believe," "intend," "estimate,"
"likely," "anticipate," "expect," "looking forward," and other similar
expressions. They are not guarantees of future performance. Actual
results may differ materially from the results expressed in these
forward-looking statements, which because of their forward-looking
nature, are difficult to predict. Investors should not place undue
reliance on any forward-looking statement, and should consider factors
that might cause differences including but not limited to the degree of
competition by traditional and nontraditional competitors, declines in
real estate markets, an increase in unemployment or sustained high
levels of unemployment; changes in interest rates; adverse changes in
local, national and international economies; changes in the Federal
Reserve's actions that affect monetary and fiscal policies; changes in
legislative or regulatory actions or reform, including without
limitation, the Dodd-Frank Wall Street Reform and Consumer Protection
Act; demand for products and services; changes to the quality of the
loan portfolio and our ability to succeed in our problem-asset
resolution efforts; the impact of technological advances; changes in tax
laws; and other risk factors. UniBank undertakes no obligation to
publicly update or clarify any forward-looking statement to reflect the
impact of events or circumstances that may arise after the date of this
release.

     
STATEMENT OF INCOME (Unaudited)
Jun-18     Mar-18     Jun-17     Jun-18     Jun-17
(Dollars in thousands except EPS) QTD     QTD     QTD YTD     YTD
Interest Income 3,354 2,976 2,459 6,330 5,101
Interest Expense (589 )     (471 )     (349 ) (1,060 )     (725 )
Net Interest Income 2,765 2,505 2,110 5,270 4,376
Provision for Loan and Lease Losses (200 ) (84 ) (260 ) (284 ) (260 )
Gain on Sale of SBA/USDA Loans 764 144 250 908 311
Other Non-interest Income 154       248       592   402       776  
Non-interest Income 918 392 842 1,310 1,087
Salaries & Benefits (1,175 ) (1,092 ) (979 ) (2,267 ) (1,903 )
Occupancy Expense (158 ) (164 ) (153 ) (322 ) (308 )
Other Expense (522 )     (564 )     (238 ) (1,086 )     (1,130 )
Non-interest Expense (1,855 ) (1,820 ) (1,370 ) (3,675 ) (3,341 )
Net Income before Income Taxes 1,627 994 1,322 2,621 1,862
Income Taxes (317 )     (152 )     (189 ) (469 )     (349 )
Net Income/(Loss) 1,310       842       1,133   2,152       1,513  
 
Average Shares Outstanding 5,495 5,455 5,049 5,475 5,012
Earnings per Share 0.24 0.15 0.22 0.39 0.30
 
                     
Statement of Condition (Unaudited)
Jun-18 Mar-18 Variance Jun-17 Variance
(Dollars in thousands) Qtr End     Qtr End     Prior Qtr Qtr End     Prior Year
 
Cash and Due from Banks 26,690 35,167 (8,477 ) 43,156 (16,466 )
Investments 41,053 41,375 (322 ) 16,356 24,697
Gross Loans 204,378 191,076 13,302 157,989 46,389
Reserve for Loan Losses (2,280 )     (2,100 )     (180 ) (1,799 )     (481 )
Net Loans 202,098 188,976 13,122 156,190 45,908
Fixed Assets 5,908 5,977 (69 ) 6,097 (189 )
Foreclosed Assets 100 100 - 100 -
Other Assets 12,676       11,567       1,109   11,590       1,086  
Total Assets 288,525       282,107       6,418   233,489       55,036  
 
Checking 39,982 42,076 (2,094 ) 37,851 2,131
NOW 4,831 4,683 148 5,523 (692 )
Money Market 102,172 109,780 (7,608 ) 81,729 20,443
Savings 8,512 9,362 (850 ) 10,980 (2,468 )
Certificates of Deposit 81,375       72,636       8,739   58,227       23,148  
Total Deposits 236,872 238,537 (1,665 ) 194,310 42,562
Borrowed Funds 10,000 3,000 7,000 - 10,000
Other Liabilities 662       585       77   430       232  
Total Liabilities 247,534       242,122       5,412   194,740       52,794  
Shareholders' Equity 40,991       39,985       1,006   38,749       2,242  
Total Liabilities & Equity 288,525       282,107       6,418   233,489       55,036  
 
             
Financial Ratios
Jun-18 Mar-18 Jun-17
(Dollars in thousands except BVS) QTD     QTD     QTD
Performance Ratios
Return on Average Assets 1.87% 1.28% 1.90%
Return on Average Equity 12.99% 8.64% 11.91%
Net Interest Margin 4.29% 4.07% 3.86%
Efficiency Ratio 50.39% 62.79% 61.51%
 
Capital
Tier 1 Leverage Ratio Not Avail 15.22% 16.18%
Common Equity Tier 1 Ratio Not Avail 18.22% 21.19%
Tier 1 Risk-Based Capital Ratio Not Avail 18.22% 21.19%
Total Risk-Based Capital Ratio Not Avail 19.16% 22.17%
Book Value per Share 7.5 7.3 7.5
 
Asset Quality
Net Loan Charge-Offs (Recoveries) 20 (16) 1,497
Allowance for Loan Losses to Loans 1.1% 1.1% 1.4%
Nonperforming Assets to Assets 0.47% 0.52% 0.68%

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