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FFW Corporation Announces 35% Increase in Net Income for the Year Ended June 30, 2011


August 12, 2011 - Wabash, IN

FFW Corporation (the "Corporation") (OTCBB: FFWC) (8/11/2011 Close: $18.00), parent corporation of Crossroads Bank, announced earnings for the quarter and fiscal year ended June 30, 2011.

For the twelve months ended June 30, 2011, the Corporation reported net income of $2,674,000, which is an increase of 35% over prior year net income of $1,980,000. Earnings per common share was $1.96 for the year ended June 30, 2011, which is 45% higher than the prior twelve month period earnings per common share of $1.35. The net interest margin for the twelve months ended June 30, 2011 was $9,868,000 compared to $9,909,000 for the twelve months ended June 30, 2010. The provision for loan losses was $1,445,000 for the twelve months ended June 30, 2011 and $1,830,000 for the twelve months ended June 30, 2010. Total noninterest income was $3,201,000 for the twelve months ended June 30, 2011 and $2,744,000 for the twelve months ended June 30, 2010. Noninterest expense was $7,990,000 for the twelve months ended June 30, 2011 and $8,371,000 for the twelve months ended June 30, 2010.

Roger K. Cromer, President and Chief Executive Officer, commented, "We are pleased with our performance for the year. We had solid loan demand during the last six months of the year. We will continue to focus our efforts on improving asset quality, controlling expenses and seeking new sources of revenue. We continue to have a solid deposit base, a very liquid balance sheet and adequate capital, so when the economy strengthens, we will be well positioned to participate in the growth."

For the three months ended June 30, 2011, the Corporation reported net income of $737,000 or $0.55 per common share. This is compared to net income of $411,000 or $0.25 per common share for the three months ended June 30, 2010. The net interest margin for the three months ended June 30, 2011 was $2,592,000 compared to $2,435,000 for the three months ended June 30, 2010. The provision for loan losses increased from $210,000 for the period ended June 30, 2010 to $300,000 for the period ended June 30, 2011. Total noninterest income was $693,000 for the three months ended June 30, 2011 and $474,000 for the three months ended June 30, 2010. Noninterest expense was $1,992,000 for the three months ended June 30, 2011 and $2,214,000 for the three months ended June 30, 2010.

The three and twelve months ended June 30, 2011 represented a return on average common equity of 11.22% and 10.03%, respectively, compared to 5.51% and 7.14% for the three and twelve month periods ended June 30, 2010. The three and twelve months ended June 30, 2011 represented a return on average assets of 0.90% and 0.80%, respectively, compared to 0.48% and 0.59% for the three and twelve month periods ended June 30, 2010.

The allowance for loan losses as a percentage of gross loans receivable was 1.39% at June 30, 2011 and 1.57% at June 30, 2010. Nonperforming assets were $13,141,000 at June 30, 2011 and $8,695,000 at June 30, 2010.

As of June 30, 2011, FFWC's equity-to-assets ratio was 9.23% compared to 8.64% at June 30, 2010. Total assets at June 30, 2011 were $323,018,000 compared to $333,564,000 at June 30, 2010. Shareholders' equity was $29,830,000 at June 30, 2011 compared to $28,804,000 at June 30, 2010. Crossroads Bank exceeds all applicable regulatory requirements to be considered "well capitalized."

Crossroads Bank is a wholly owned subsidiary of FFW Corporation providing an extensive array of banking services and a wide range of investments and securities products through its main office in Wabash and four Indiana banking centers located in Columbia City, North Manchester, South Whitley, and Syracuse. The Bank provides leasing services at its banking centers and its Carmel, IN leasing and commercial loan office. Insurance products are offered through an affiliated company, Insurance 1 Services, Inc. The corporation's stock is traded on the OTC Bulletin Board under the symbol "FFWC.OB." Our website address is www.crossroadsbanking.com.




FFW Corporation
Selected Financial Information

Consolidated Balance Sheet

June 30 June 30
------------- -------------
2011 2010
------------- -------------
Unaudited
Assets
Cash and due from financial institutions $ 3,711,671 $ 3,229,138
Interest-earning deposits in other financial
institutions 2,840,994 7,386,372
------------- -------------
Cash and cash equivalents 6,552,665 10,615,510
------------- -------------

Securities available for sale 71,219,096 76,716,794
Loans receivable, net of allowance for loan
losses of $3,147,896 at June 30, 2011 and
$3,582,476 at June 30, 2010 222,348,968 224,135,086
Loans held for sale 241,400 40,000
Federal Home Loan Bank stock, at cost 2,717,300 3,627,100
Accrued interest receivable 1,635,370 1,645,286
Premises and equipment, net 3,695,172 3,889,487
Mortgage servicing rights 444,950 375,052
Cash surrender value of life insurance 6,655,864 6,374,995
Goodwill 1,213,898 1,213,898
Deferred tax asset 1,653,133 1,893,647
Other assets 4,640,682 3,036,680
------------- -------------
Total assets $ 323,018,498 $ 333,563,535
------------- -------------

Liabilities and shareholders' equity
Deposits
Noninterest-bearing deposits $ 17,954,304 $ 16,278,993
Interest-bearing deposits 257,509,026 262,550,500
------------- -------------
Total deposits 275,463,330 278,829,493
------------- -------------

Borrowings 16,062,945 24,699,557
Accrued expenses and other liabilities 1,662,503 1,230,602
------------- -------------
Total liabilities 293,188,778 304,759,652
------------- -------------

Shareholders' equity
Preferred stock, $.01 par; $1,000 liquidation
value per share; 500,000 shares authorized;
Series A, 5% Fixed Rate Cumulative Perpetual
Preferred Stock - 7,289 shares outstanding
June 30, 2011 and 2010, $7,334,000
liquidation preference 7,085,539 7,004,155
Series B, 9% Fixed Rate Cumulative Perpetual
Preferred Stock - 364 shares outstanding
June 30, 2011 and 2010, $368,000
liquidation preference 385,461 394,045
Common stock, $.01 par; 2,000,000 shares
authorized;
issued: 1,836,328
outstanding: 1,121,884 shares - June 30,
2011 and 1,117,260 shares - June 30, 2010 18,363 18,363
Additional paid-in capital 9,435,162 9,440,356
Retained earnings 24,095,722 22,880,556
Accumulated other comprehensive income (223,833) 104,080
Treasury stock, at cost: 714,444 shares - June
30, 2011 and 719,068 shares - June 30, 2010 (10,966,694) (11,037,672)
------------- -------------
Total shareholders' equity 29,829,720 28,803,883
------------- -------------

------------- -------------
Total liabilities and shareholders' equity $ 323,018,498 $ 333,563,535
------------- -------------




FFW Corporation
Selected Financial Information

Consolidated Statement of Income

Three Months Ended Twelve Months Ended
June 30 June 30
------------------------ ------------------------
2011 2010 2011 2010
----------- ----------- ----------- -----------
Unaudited Unaudited Unaudited
Interest and dividend
income:
Loans, including fees $ 3,056,603 $ 3,250,464 $12,217,074 $13,725,393
Taxable securities 610,803 638,978 2,459,676 2,568,076
Tax exempt securities 143,485 164,819 601,087 682,099
Other 3,685 5,684 30,688 24,976
----------- ----------- ----------- -----------
Total interest and
dividend income 3,814,576 4,059,945 15,308,525 17,000,544
----------- ----------- ----------- -----------

Interest expense:
Deposits 1,088,143 1,344,447 4,657,152 5,548,022
Borrowings 134,197 280,145 783,724 1,543,180
----------- ----------- ----------- -----------
Total interest
expense 1,222,340 1,624,592 5,440,876 7,091,202
----------- ----------- ----------- -----------

Net interest income 2,592,236 2,435,353 9,867,649 9,909,342

Provision for loan
losses 300,000 210,000 1,445,000 1,830,000

Net interest income
after provision for
loan losses 2,292,236 2,225,353 8,422,649 8,079,342

Noninterest income:
Net gains on sales of
securities 142,850 (39,543) 400,589 429,360
Net gains on sales of
loans 26,464 79,208 480,642 284,566
Net gains (losses) on
fixed assets - 6,500 5,001 6,500
Other than temporary
impairment on
securities - (100,000) - (250,000)
Commission income 155,821 163,539 637,247 584,273
Service charges and
fees 276,003 229,973 1,318,363 1,135,202
Earnings on life
insurance 70,243 71,082 280,870 280,674
Other 21,326 62,926 78,761 273,839
----------- ----------- ----------- -----------
Total noninterest
income 692,707 473,685 3,201,473 2,744,414
----------- ----------- ----------- -----------

Noninterest expense:
Salaries and benefits 980,910 949,830 3,961,729 3,992,732
Occupancy and
equipment 238,359 263,675 981,005 966,723
Professional 106,696 102,720 398,358 393,970
Marketing 35,511 36,578 151,468 135,711
Deposit insurance
premium 134,201 118,244 513,024 469,235
Regulatory assessment 25,899 25,545 102,680 99,687
Correspondent bank
charges 26,136 19,661 86,942 77,645
Data processing 102,368 385,215 426,295 828,431
Printing, postage and
supplies 63,032 56,138 231,767 245,245
Expense on life
insurance 14,902 16,694 41,018 66,775
Contribution expense 17,546 12,882 72,563 51,981
Other 246,869 226,604 1,023,592 1,042,603
----------- ----------- ----------- -----------
Total noninterest
expense 1,992,429 2,213,786 7,990,441 8,370,738
----------- ----------- ----------- -----------

Income before income
taxes 992,514 485,252 3,633,681 2,453,018

Income tax expense 255,730 73,902 959,845 473,115

----------- ----------- ----------- -----------
Net income $ 736,784 $ 411,350 $ 2,673,836 $ 1,979,903
----------- ----------- ----------- -----------
Preferred stock
dividends and discount
accretion, net 117,504 117,503 470,016 470,010
----------- ----------- ----------- -----------
Net income attributable
to common shareholders $ 619,280 $ 293,847 $ 2,203,820 $ 1,509,893
----------- ----------- ----------- -----------




FFW Corporation
Selected Financial Information

Three Months Ended Twelve Months Ended
June 30 June 30
------------------------ ------------------------
2011 2010 2011 2010
----------- ----------- ----------- -----------
Unaudited Unaudited Unaudited
Per common share data:
Earnings $ 0.55 $ 0.25 $ 1.96 $ 1.35
Diluted earnings $ 0.55 $ 0.25 $ 1.96 $ 1.35
Dividends paid $ 0.22 $ 0.22 $ 0.88 $ 0.88
Average shares issued
and outstanding 1,121,884 1,117,260 1,122,694 1,114,397
Shares outstanding end
of period 1,121,884 1,117,260 1,121,884 1,117,260

Supplemental data:
Net interest margin ** 3.22% 3.04% 3.15% 3.10%
Return on average assets
*** 0.90% 0.48% 0.80% 0.59%
Return on average common
equity *** 11.22% 5.51% 10.03% 7.14%

June 30 June 30
----------- -----------
2011 2010
----------- -----------
Nonperforming assets * $13,140,830 $ 8,694,798
Repossessed assets $ 2,502,944 $ 1,230,635

* Includes non-accruing loans, accruing loans delinquent more than 90 days
and repossessed assets
** Yields reflected have not been computed on a tax equivalent basis
*** Annualized


FOR MORE INFORMATION
Contact:
Emily Boardman
Treasurer
260-563-3185

MarketWire

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