Rurban Financial Corp. Reports 6.1 Percent Increase in Third Quarter 2007 Earnings


DEFIANCE, Ohio, Oct. 17, 2007 (PRIME NEWSWIRE) -- Rurban Financial Corp. (Nasdaq:RBNF), a leading provider of full-service community banking, investment management, trust services and bank data processing, reported third quarter 2007 net income of $864,000, an increase of 6.1 percent over the $814,000 reported for the third quarter of 2006. Third quarter 2007 earnings were $0.17 per diluted share, an increase of 6.3 percent from the $0.16 reported for the prior-year period. Compared with the second quarter of 2007, net income and diluted earnings per share increased by 10.0 and 6.5 percent, respectively.

For the nine months ended September 30, 2007, Rurban reported net income of $2,351,000, up $301,000, or 14.7 percent, from the $2,050,000 reported for the nine months ended September 30, 2006. Diluted earnings per share were $0.47 for the current year, up 14.6 percent compared with the $0.41 reported for the prior year.

Highlights of the quarter include:


 * RDSI, Rurban's data processing subsidiary, reported another 
   exceptional quarter.  Revenue from RDSI rose 30.5 percent above the 
   prior-year third quarter, accounting for 51.1 percent of Rurban's 
   total revenue. Net income for RDSI was $659,000, up 38.0 percent 
   from the year-ago quarter. Year-over-year growth reflects RDSI's 
   continued organic expansion, greater penetration of its markets, 
   entry into new markets, and the results of DCM, an item processing 
   company acquired on September 2, 2006.

 * Following the consolidation of the operational activities of The 
   Exchange Bank into The State Bank and Trust Company in the first 
   quarter of 2007, The State Bank and Trust Company has been growing 
   its loan portfolio as it capitalizes on the new markets, as well as 
   its recent entry into Fort Wayne, Indiana.  The Bank continues to 
   implement an aggressive calling strategy resulting in year-to-date 
   consolidated loan growth of $18.2 million, up 4.9 percent from 
   December 31, 2006, driven primarily by increases in commercial 
   loans.

 * Credit quality remains solid; non-performing assets increased 
   slightly to $6.4 million or 1.14 percent, of total assets for the 
   current quarter, from $6.1 million, or 1.07 percent, a year-ago. 
   Non-performing assets increased by $435,000 from the second quarter 
   2007.  The increase on a quarter-to-quarter basis reflects modest 
   deterioration, which is diversified across several business lines: 
   residential real estate, agriculture and consumer loans. Net loan 
   charge-offs were nominal at $28,000 for the quarter and $159,000 
   for the nine months ended September 30, 2007. 

 * On April 12, 2007, Rurban initiated a stock repurchase program, 
   authorizing the repurchase of up to 250,000 shares, or 
   approximately five percent, of the Company's outstanding shares. As 
   of September 30, 2007, Rurban has repurchased 28,000 shares at an 
   average cost of $12.52; 16,000 of these shares were repurchased 
   during the third quarter of 2007 at an average cost of $12.58.

Kenneth A. Joyce, Rurban's President and Chief Executive Officer, commented, "This was a relatively quiet quarter for Rurban showing continuing progress on most fronts. We are improving our earnings performance through continued attention to, and mitigation of, the many risks in this challenging environment. Our consolidation initiatives are reducing operating expenses consistent with our projections. Also, RDSI in particular has been making an ever-stronger contribution to earnings growth. The recent 50 basis point reduction in the Federal Funds Discount Rate and the subsequent change in the prime rate should improve net interest income over the course of the next six to twelve months as our Bank is liability-sensitive. We had a number of one-time adjustments in the comparison to past quarters, but overall the net interest margin at our Bank held firm. Most importantly, we do not see any material deterioration of credit quality as non-performing assets have held relatively steady, as have delinquencies. We realize that we have much work to do, but we are keeping our goals in sight, paying attention to basic blocking and tackling, and we believe we are on the right track for Rurban and for the investors in our stock."


 CONSOLIDATED OPERATIONS

 ------------------------------------------------------------------
 Earnings: (Three months ended)    Sept. 2007 June 2007 Sept. 2006
 ------------------------------------------------------------------
                       (Dollars in thousands except per share data)
 ------------------------------------------------------------------
 Total Revenue                         $10,444   $10,258   $ 9,659
 Net interest income                     3,661     3,750     3,756
 Provision for loan losses                 140       146        35
 Non-interest income                     6,783     6,508     5,903
 Non-interest expense                    9,106     9,065     8,515
 Net income                            $   864   $   785   $   814
 ------------------------------------------------------------------
 Diluted EPS                           $  0.17   $  0.16   $  0.16
 ------------------------------------------------------------------

Total revenue, consisting of net interest income plus non-interest income, was $10.4 million for the third quarter of 2007, an increase of $785,000, or 8.1 percent, compared with $9.7 million for the prior-year third quarter. Compared with the second quarter of this year, total revenue increased $186,000, or 1.8 percent. Net interest income was $3.7 million in the current quarter, a decrease of $95,000, or 2.5 percent, from the 2006 third quarter, as a result of portfolio restructuring that lowered the level of Earning Assets. Net interest income decreased $89,000, or 2.4 percent, from the $3.8 million reported for the second quarter of this year, due to one-time items in the second quarter.


 ---------------------------------------------------------------------
  Margin (QTR)     Sept. 2007         June 2007         Sept. 2006
 ---------------------------------------------------------------------
 (Bank Only)     Balance   Rate    Balance    Rate    Balance    Rate
 ---------------------------------------------------------------------
                                (Dollars in thousands)
 ---------------------------------------------------------------------
 Loans          $386,337   7.32%   $380,598   7.41%   $370,063   7.22%
 Investments    $ 97,952   5.00%   $ 99,411   4.87%   $132,129   4.47%
 Earning Assets $488,240   6.84%   $482,447   6.88%   $504,391   6.49%
 Deposits       $418,764   3.32%   $418,391   3.24%   $419,052   2.87%
 Total Funds    $475,973   3.51%   $469,363   3.41%   $494,313   3.16%
 Net Interest
  Margin                   3.41%              3.56%              3.40%
 ---------------------------------------------------------------------

Net interest margin for the Bank for the quarter ended September 30, 2007 was 3.41%, a one basis point increase from the 2006 third quarter margin of 3.40% and a 15 basis point drop from the 2007 second quarter margin of 3.56%. The margin for second quarter of 2007 was aided by a $70,000 recovery of interest income on non-accrual loans and other loan fees that are included in the yield. The yields on loans increased 10 basis points from third quarter 2007 compared to the third quarter 2006. The yield on investments increased by 53 basis points due to the balance sheet restructuring that was completed at year-end. The yield on Earning Assets increased 35 basis points year-over-year for the third quarter. Total cost of deposits increased 45 basis points for the third quarter 2007, compared to the third quarter 2006. Total funding cost increased by 35 basis points year-over-year.

"Margin pressure remains a challenge for the banking industry," said Joyce. "We are very encouraged that we have been able to maintain our margin in the Bank during the past twelve months. Our yield on Earning Assets increased by 35 basis points and was offset by an increase in cost of funds of an equivalent 35 basis points. We feel that our cost of deposits have hit a plateau and we expect them to decrease going forward. We will experience some decrease in our yield on loans going forward due to the Fed's rate cut. However, we have been successful in reducing our offering rates on deposits, which we believe will more than offset the decrease in loan rates. We have been very focused on increasing our core deposits, for example, our interest bearing checking accounts have increased by $4.9 million during the past twelve months. We remain confident that we are improving our Bank's fundamentals each quarter."

Non-interest income, derived primarily from RDSI, continues to be an increasingly significant contributor to Rurban's revenue stream, accounting for 51.1 percent of total revenue for the third quarter of 2007, compared with 42.3 percent for the year-ago quarter. Non-interest income grew $880,000, or 14.9 percent, increasing to $6.8 million when compared to the previous-year quarter; compared with the linked quarter, non-interest income grew $275,000, or 4.2 percent. On both a year-over-year and a linked quarter basis, growth in non-interest income was driven by data service fees, which increased $1.2 million and $375,100, respectively. The year-over-year increase is mainly due to the acquisition of DCM, which occurred on September 2, 2006. DCM accounted for $758,000 of the $1.2 million increase in data service fees. Trust fees, the second largest component of non-interest income, increased $66,500, or 8.8%, from the prior-year quarter. Excluding second quarter 2007 $45,000 fees for tax preparation, trust fees remained flat compared with the linked quarter. The growth in data processing fees and trust fees were offset by lower gains on the sale of mortgage loans and a reduction to other income. The other income decrease was due to one-time recoveries of $174,000 in the 2006 third quarter relating to The Exchange Bank.

The provision for loan losses was $140,000 compared with $35,000 for the third quarter of 2006, and $146,000 for the second quarter of 2007, reflecting both loan portfolio growth and a slightly higher level of non-performing assets.

Third quarter 2007 non-interest expense was $9.1 million, up $592,000, or 6.9 percent, from the prior-year third quarter. The year-over-year increase is due to the acquisition of DCM. Excluding the DCM acquisition, non-interest expense decreased by $203,000 reflecting the expense reductions identified and taken in the beginning of 2007. Compared with the second quarter, operating expenses were virtually unchanged, up $41,000, or 0.5 percent. Salaries and benefits increased marginally as a result of the growth being experienced at RDSI and DCM. Marketing expenses increased slightly due to the increased marketing expenses associated with the High Performance Checking account promotion at the Bank. Other expenses increased slightly due to the write-down of Other Assets Owned. Many of the expense categories experienced decreases due to the efficiencies gained following the merger of The Exchange Bank into The State Bank and Trust Company. At quarter-end, Rurban had 280 FTE employees, 37 fewer than at year-end 2006. The majority of this reduction is accounted for within the Bank.

Rurban continues to be very well capitalized. Shareholders' equity at September 30, 2007 was $58.5 million, equivalent to 10.3 percent of total assets; on a tangible basis, the ratio was 7.9 percent. The total risk-based capital ratio was 15.7 percent, well in excess of the "well-capitalized" regulatory threshold of 10 percent.

THE STATE BANK AND TRUST COMPANY

The State Bank and Trust Company reported net income of $714,000 for the quarter, compared with $872,000 for the prior-year quarter, a decrease of 18.4 percent. Compared with the second quarter of 2007, income decreased $203,000, or 22.2 percent. Revenue for the Bank (net interest income plus non-interest income) was $5.9 million for the current quarter, a decline of $454,000, or 7.1 percent, from the year earlier level of $6.4 million. During the 2006 third quarter, $265,000 of additional revenue was recorded on payments of impaired loans and the sale of previously charged-off loans at Exchange Bank. The Company also experienced a decrease in gain on sale of loans of $209,000 due to a decrease in residential real estate lending. Revenue decreased $191,000, or 3.1 percent, from the linked quarter's results. This, once again, was primarily due to the decrease in gains from saleable real estate loans and the aforementioned $70,000 recovery of interest on non-accrual loans during the second quarter 2007. Non-interest expense decreased $166,000 to $4.8 million for the current quarter compared with $5.0 million for the third quarter of 2006. The decrease continued to be driven by the operating efficiencies completed at the end of the first quarter. Non-interest expense increased $92,000 in the third quarter of 2007 compared to the second quarter of 2007. This increase was due to an increase in health care costs and additional advertising expenses associated with the High Performance Checking account promotion.

Loan growth over the past twelve months was $23.9 million, or 6.6 percent, reaching $388.3 million at September 30, 2007. Compared with the linked quarter, loans grew $6.6 million, or an annualized 6.9 percent. Year-over-year loan growth was primarily attributable to increases in commercial real estate (CRE) loans and commercial and industrial (C&I) loans. Partially offsetting these increases were declines in consumer loans and residential mortgages.

Deposits at September 30, 2007 were $413.2 million, up $1.0 million, or 0.2 percent, from the third quarter of 2006, and up $5.6 million from the linked quarter. The increase from the previous quarter resulted from an $8.5 million increase in retail time deposits, and a $2.5 million increase in NOW accounts, and other transaction accounts. The increase was partially offset by a $5.2 million decrease in savings and money market accounts. Rurban's deposit mix continued to shift toward core deposits, which accounted for 87.0 percent of total deposits at period-end, compared with 86.8 percent for the linked quarter, and 83.8 percent for the prior-year quarter.


 ASSET QUALITY

 ---------------------------------------------------------------------
 Asset Quality                     Sept. 2007   June 2007   Sept. 2006
 ---------------------------------------------------------------------
                                          (Dollars in thousands)
 ---------------------------------------------------------------------
 Net charge-offs / (Recoveries)           $28         $90        $(54)
 ---------------------------------------------------------------------
 Net charge-offs (Ann.) / Avg. loans    0.03%       0.09%      (0.06%)
 ---------------------------------------------------------------------
 Allowance for loan loss               $3,937      $3,824       $4,522
 ---------------------------------------------------------------------
 Allowance for loan loss / Loans        1.01%       1.00%        1.24%
 ---------------------------------------------------------------------
 Non-performing assets                 $6,432      $5,997       $6,126
 ---------------------------------------------------------------------
 NPA / Total assets                     1.14%       1.09%        1.07%
 ---------------------------------------------------------------------

Non-performing assets (loans + OREO + OAO) were $6.4 million, or 1.14 percent, of total assets at September 30, 2007, an increase of $306,000 from twelve months ago, and an increase of $435,000 from the second quarter. Rurban's non-performing assets continue to be impacted by three legacy credits totaling $2.1 million. Net charge-offs for the second quarter were $28,000, compared with a recovery of $54,000 in the third quarter of 2006, and net charge-offs of $90,000 for the linked quarter. The loan loss reserve is 1.01 percent of period-end loans.

RFCBC, Inc. (Loan Workout Company)

RFCBC's sole remaining loan relationship is currently in litigation; with resolution, Rurban expects to close out the loan workout company by 2007 year-end or first quarter 2008. RFCBC recorded a nominal loss of $39,000 for the quarter compared to $82,000 for the previous-year quarter. The majority of the expenses are being incurred from litigation costs associated with the remaining loan and past legal issues; there are no employees at RFCBC, as the remaining workout activity is being outsourced.

RURBANC DATA SERVICES, INC (RDSI)

Revenue for the quarter was $5.3 million, up $1.2 million, or 30.5 percent, above the $4.1 million reported for the third quarter of 2006; compared with the linked quarter, revenue increased $383,000, or 7.7 percent. RDSI continues to build its client base signing three new data processing clients during the third quarter of 2007. There are four conversions scheduled over the next several months, which will continue to build RDSI revenue and net income. Currently, RDSI services 113 community banks.

Earnings for the third quarter were $659,000, compared to $478,000 for the year-ago quarter, up $181,000, or 38.0 percent; on a linked quarter basis, third quarter net income increased by $183,000, or 38.5 percent

ABOUT RURBAN FINANCIAL CORP.

Rurban Financial Corp. is a publicly-held financial services holding company based in Defiance, Ohio with assets of $565.7 million as of September 30, 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, 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, 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 4,999,433 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
 September 30, 2007 and December 31, 2006

                                            September       December
                                              2007            2006
                                              ----            ----
                                          (Unaudited)
 ASSETS
 Cash and due from banks                 $  12,859,263  $  13,381,791
 Federal funds sold                                 --      9,100,000
                                         -------------  -------------
  Cash and cash equivalents                 12,859,263     22,481,791

 Interest-earning deposits in other
  financial institutions                            --        150,000
 Available-for-sale securities             102,759,847    102,462,075
 Loans held for sale                                --        390,100
 Loans, net of unearned income             388,264,099    370,101,809
 Allowance for loan losses                  (3,936,545)    (3,717,377)
 Premises and equipment, net                15,290,795     15,449,774
 Purchased software                          4,500,417      4,618,691
 Federal Reserve and Federal Home Loan
  Bank Stock                                 4,021,200      3,993,450
 Foreclosed assets held for sale, net           64,805         82,397
 Accrued interest receivable                 3,374,265      3,129,774
 Goodwill                                   13,940,618     13,674,058
 Core deposits and other intangibles         5,322,647      5,858,982
 Cash value of life insurance               12,048,425     10,771,843
 Other assets                                7,164,456      6,559,886
                                         -------------  -------------
   Total assets                          $ 565,674,291  $ 556,007,253
                                         =============  =============


 LIABILITIES AND SHAREHOLDERS' EQUITY
 Liabilities
  Deposits

   Demand                                $  41,486,691  $  46,565,554
   Savings, interest checking and money
    market                                 138,095,329    130,267,333
   Time                                    233,570,398    237,722,558
                                         -------------  -------------
    Total deposits                         413,152,418    414,555,445
  Notes payable                              1,025,992      2,589,207
  Advances from Federal Home Loan Bank      19,000,000     21,000,000
  Fed Funds Purchased                        4,400,000             --
  Repurchase Agreements                     42,566,025     32,270,900
  Trust preferred securities                20,620,000     20,620,000
  Accrued interest payable                   2,409,523      2,224,413
  Other liabilities                          3,995,977      5,792,135
                                         -------------  -------------

    Total liabilities                      507,169,936    499,052,100

 Shareholders' Equity
  Common stock                              12,568,583     12,568,583
  Additional paid-in capital                14,902,827     14,859,165
  Retained earnings                         31,805,145     30,407,298
  Accumulated other comprehensive loss        (421,721)      (879,893)
  Treasury stock                              (350,480)            --
                                         ----------------------------

    Total shareholders' equity              58,504,355     56,955,153
                                         -------------  -------------

    Total liabilities and shareholders'
     equity                              $ 565,674,291  $ 556,007,253
                                         =============  =============

 RURBAN FINANCIAL CORP. AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
 For The Third Quarter Ended September 30, 2007 and 2006
                                                            Increase/
                                 Third         Third        ---------
                                Quarter       Quarter       (Decrease)
                                  2007          2006        ---------
                                  ----          ----           $
                                                               -
 Interest income
  Loans
   Taxable                     $ 7,072,488  $ 6,641,379  $   431,109
   Tax-exempt                       16,668       18,326       (1,658)
  Securities
   Taxable                       1,041,177    1,306,979     (265,802)
   Tax-exempt                      169,719      141,943       27,776
  Other                             50,288       48,846        1,442
                               -----------  -----------  -----------
    Total interest income        8,350,340    8,157,473      192,867


 Interest expense
  Deposits                       3,497,275    3,017,993      479,282
  Other borrowings                  32,026       67,773      (35,747)
  Retail Repurchase Agreements     435,216      182,007      253,209
  Federal Home Loan Bank
   advances                        268,289      667,749     (399,460)
  Trust preferred securities       456,582      466,417       (9,835)
                               -----------  -----------  -----------
    Total interest expense       4,689,389    4,401,939      287,450
                               -----------  -----------  -----------

 Net interest income             3,660,951    3,755,534      (94,583)

  Provision for loan losses        140,409       35,000      105,409
                               -----------  -----------  -----------

 Net interest income after
  provision for loan losses      3,520,543    3,720,534     (199,991)

 Non-interest income
  Data service fees              5,004,394    3,785,037    1,219,357
  Trust fees                       819,989      753,449       66,540
  Customer service fees            588,447      542,518       45,929
  Net gain on sales of loans        73,581      283,123     (209,542)
  Net realized gains on sales
   of available-for-sale
   securities                           --           --           --
  Loan servicing fees               82,651       96,754      (14,103)
  Gain on sale of assets            11,862       25,914      (14,052)
  Other income                     201,920      415,961     (214,041)
                               -----------  -----------  -----------
    Total non-interest income    6,782,842    5,902,756      880,086

 Non-interest expense
  Salaries and employee
   benefits                      4,290,961    4,253,924       37,037
  Net occupancy expense            514,742      468,855       45,887
  Equipment expense              1,625,762    1,445,073      180,689
  Data processing fees             102,292      146,703      (44,411)
  Professional fees                461,844      481,132      (19,288)
  Marketing expense                259,196      168,031       91,165
  Printing and office supplies     130,363      126,765        3,598
  Telephone and communication      446,465      467,692      (21,227)
  Postage and delivery expense     392,211      142,957      249,254
  State, local and other taxes     103,674      188,464      (84,790)
  Employee expense                 266,227      235,429       30,798
  Other expenses                   512,663      389,631      123,032
                               -----------  -----------  -----------
    Total non-interest expense   9,106,400    8,514,656      591,744
                               -----------  -----------  -----------
 Income before income tax
  expense                        1,196,985    1,108,634       88,351
  Income tax expense               333,384      294,893       38,491
                               -----------  -----------  -----------

 Net income                    $   863,601  $   813,741  $    49,860
                               ===========  ===========  ===========

 Earnings per common share:
  Basic                        $      0.17  $      0.16  $      0.01
                               ===========  ===========  ===========
  Diluted                      $      0.17  $      0.16  $      0.01
                               ===========  ===========  ===========
 Average diluted shares
  outstanding                    5,008,334    5,027,704
                               ===========  ===========

 RURBAN FINANCIAL CORP. AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
 For The Three Months Ended September 30, 2007 and June 30, 2007

                                                           Increase/
                                  Third       Second       ---------
                                 Quarter      Quarter      (Decrease)
                                   2007         2007       ---------
                                   ----         ----          $
                                                              -
 Interest income
  Loans
   Taxable                     $ 7,072,488  $ 6,976,506  $    95,982
   Tax-exempt                       16,668       17,250         (582)
  Securities
   Taxable                       1,041,177    1,044,300       (3,123)
   Tax-exempt                      169,719      160,845        8,874
  Other                             50,288       35,138       15,150
                               -----------  -----------  -----------

   Total interest income         8,350,340    8,234,039      116,301

 Interest expense
  Deposits                       3,497,275    3,381,667      115,608
  Other borrowings                  32,026       57,546      (25,520)
  Retail Repurchase Agreements     435,216      351,833       83,383
  Federal Home Loan Bank
   advances                        268,289      242,658       25,631
  Trust preferred securities       456,582      450,197        6,385
                               -----------  -----------  -----------
   Total interest expense        4,689,389    4,483,901      205,488
                               -----------  -----------  -----------

 Net interest income             3,660,951    3,750,138      (89,187)

  Provision for loan losses        140,409      145,594       (5,185)
                               -----------  -----------  -----------

 Net interest income after
  provision for loan losses      3,520,543    3,604,544      (84,001)

 Non-interest income
  Data service fees              5,004,394    4,629,258      375,136
  Trust fees                       819,989      865,880      (45,891)
  Customer service fees            588,447      533,209       55,238
  Net gain on sales of loans        73,581      174,168     (100,587)
  Net realized gains on sales
   of available-for-sale
   securities                           --          367         (367)
  Loan servicing fees               82,651       89,432       (6,781)
  Gain on sale of assets            11,862       14,010       (2,148)
  Other income                     201,920      201,376          544
                               -----------  -----------  -----------

   Total non-interest income     6,782,842    6,507,700      275,142

 Non-interest expense
  Salaries and employee
   benefits                      4,290,961    4,185,324      105,637
  Net occupancy expense            514,742      505,925        8,817
  Equipment expense              1,625,762    1,676,676      (50,914)
  Data processing fees             102,292      114,243      (11,951)
  Professional fees                461,844      501,015      (39,171)
  Marketing expense                259,196      187,098       72,098
  Printing and office supplies     130,363      181,362      (50,999)
  Telephone and communication      446,465      437,690        8,775
  Postage and delivery expense     392,211      384,091        8,120
  State, local and other taxes     103,674      165,175      (61,501)
  Employee expense                 266,227      280,078      (13,851)
  Other expenses                   512,663      446,693       65,970
                               -----------  -----------  -----------

   Total non-interest expense    9,106,400    9,065,370       41,030
                               -----------  -----------  -----------


 Income before income tax
  expense                        1,196,985    1,046,874      150,111
  Income tax expense               333,384      261,829       71,555
                               -----------  -----------  -----------

 Net income                    $   863,601  $   785,045  $    78,556
                               ===========  ===========  ===========
 Earnings per common share:
  Basic                        $      0.17  $      0.16  $      0.01
                               ===========  ===========  ===========
  Diluted                      $      0.17  $      0.16  $      0.01
                               ===========  ===========  ===========

 Average diluted shares
  outstanding                   5,008,334   5,031,458


 RURBAN FINANCIAL CORP. AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
 For The Nine Months Ended September 30, 2007 and 2006
                                                          Increase/
                                                          ---------
                             Nine Months   Nine Months    (Decrease)
                                2007          2006        ----------
                                ----          ----            $
                                                              -
 Interest income
  Loans
   Taxable                  $ 20,725,807  $ 18,238,590  $  2,487,217
   Tax-exempt                     51,211        45,718         5,493
  Securities
   Taxable                     3,176,674     3,953,438      (776,764)
   Tax-exempt                    483,621       410,346        73,275
  Other                          163,894        99,158        64,736
                            ------------  ------------  ------------
    Total interest income     24,601,207    22,747,250     1,853,957

 Interest expense
  Deposits                    10,212,672     7,695,387     2,517,285
  Other borrowings               140,644       120,220        20,424
  Repurchase Agreements        1,130,898       465,560       665,338
  Federal Home Loan Bank
   advances                      760,534     1,684,415      (923,881)
  Trust preferred
   securities                  1,352,093     1,331,615        20,478
                            ------------  ------------  ------------
    Total interest expense    13,596,842    11,297,197     2,299,645
                            ------------  ------------  ------------

 Net interest income          11,004,365    11,450,053      (445,688)

  Provision for loan losses      378,643       337,321        41,322
                            ------------  ------------  ------------

 Net interest income after
  provision for loan losses   10,625,723    11,112,732      (487,009)

 Non-interest income
  Data service fees           14,467,788    10,312,757     4,155,031
  Trust fees                   2,512,251     2,361,127      151,124
  Customer service fees        1,650,080     1,635,272        14,808
  Net gain on sales of
   loans                         302,028       415,833      (113,805)
  Net realized gains on
   sales of available-for-
   sale securities                   367            --           367
  Loan servicing fees            280,789       301,233       (20,444)
  Gain on sale of assets          61,839        85,346       (23,507)
  Other income                   754,144     1,067,739      (313,595)
                            ------------  ------------  ------------
   Total non-interest
    income                    20,029,284    16,179,307     3,849,977

 Non-interest expense
  Salaries and employee
   benefits                   12,873,072    11,906,909       966,163
  Net occupancy expense        1,547,800     1,334,722       213,078
  Equipment expense            4,908,311     4,168,534       739,777
  Data processing fees           372,716       402,661       (29,945)
  Professional fees            1,640,250     1,525,399       114,851
  Marketing expense              601,979       536,977        65,002
  Printing and office
   supplies                      509,817       453,110        56,707
  Telephone and
   communication               1,329,359     1,277,707        51,652
  Postage and delivery
   expense                     1,168,563       397,217       771,346
  State, local and other
   taxes                         468,590       512,757       (44,167)
  Employee expense               801,374       745,341        56,033
  Other expenses               1,250,192     1,283,228       (33,036)
                            ------------  ------------  ------------
   Total non-interest
    expense                   27,472,023    24,544,562     2,927,461
                            ------------  ------------  ------------

 Income before income tax
  expense                      3,182,984     2,747,477       435,507
  Income tax expense             831,885       697,668       134,217
                            ------------  ------------  ------------

 Net income                 $  2,351,099  $  2,049,809  $    301,290
                            ============  ============  ============
 Earnings per common share:
  Basic                     $       0.47  $       0.41  $       0.06
                            ============  ============  ============
  Diluted                   $       0.47  $       0.41  $       0.06
                            ============  ============  ============

 Average diluted shares
  outstanding                  5,021,939     5,029,338
                            ============  ============

    RURBAN FINANCIAL CORP.
 CONSOLIDATED FINANCIAL HIGHLIGHTS
         (Unaudited)
 ------------------------  ---------  ---------  ---------  ---------
 (dollars in thousands      3rd Qtr       YTD     3rd Qtr       YTD
  except per share data)      2007       2007       2006       2006
 ------------------------  ---------  ---------  ---------  ---------

 EARNINGS
  Net interest income      $   3,661  $  11,004  $   3,756  $  11,450
  Provision for loan loss  $     140  $     379  $      35  $     337
  Non-interest income      $   6,783  $  20,029  $   5,903  $  16,179
  Revenue (net interest
   income plus non-
   interest income)        $  10,444  $  31,034  $   9,659  $  27,629
  Non-interest expense     $   9,106  $  27,472  $   8,515  $  24,545
  Net income (loss)        $     864  $   2,351  $     814  $   2,050

 PER SHARE DATA
  Basic earnings per
   share                   $    0.17  $    0.47  $    0.16  $    0.41
  Diluted earnings per
   share                   $    0.17  $    0.47  $    0.16  $    0.41
  Book value per share     $   11.70  $   11.70  $   11.16  $   11.16
  Tangible book value per
   share                   $    7.87  $    7.87  $    7.19  $    7.19
  Cash dividend per share  $    0.07  $    0.19  $    0.05  $    0.15

 PERFORMANCE RATIOS
  Return on average
   assets                       0.62%      0.57%      0.59%      0.50%
  Return on average
   equity                       5.97%      5.44%      5.95%      5.21%
  Net interest margin
   (tax equivalent)             2.96%      3.10%      3.10%      3.12%
  Net interest margin
   (Bank Only)                  3.41%      3.47%      3.40%      3.82%
  Non-interest expense /
   Average assets               6.56%      6.63%      6.15%      5.95%
  Efficiency Ratio - bank
   (non-GAAP)                  80.14%     80.52%     84.01%     85.85%

 MARKET DATA PER SHARE
  Market value per share
   -- Period end           $   12.65  $   12.65  $   11.92  $   11.92
  Market as a % of book         1.08       1.08       1.07       1.07
  Cash dividend yield           2.21%      2.00%      1.68%      1.82%
  Period-end common
   shares outstanding
   (000)                       4,999      4,999      5,027      5,027
  Common stock market
   capitalization ($000)   $  63,237  $  63,237  $  59,927  $  59,927

 CAPITAL & LIQUIDITY
  Equity to assets              10.3%      10.3%       9.8%       9.8%
  Period-end tangible
   equity to assets              7.0%       7.0%       6.3%       6.3%
  Tier 1 risk-based
   capital ratio                14.6%      14.6%      14.6%      14.6%
  Total risk-based
   capital ratio                15.7%      15.7%      16.0%      16.0%

 ASSET QUALITY
  Net charge-offs /
   (Recoveries)            $      28  $     159  $     (54) $     510
  Net loan charge-offs
   (Ann.) / Average loans       0.03%      0.06%     (0.06%)     0.29%
  Non-performing loans     $   6,361  $   6,361  $   5,636  $   5,636
  OREO / OAOs              $      71  $      71  $     490  $     490
  Non-performing assets    $   6,432  $   6,432  $   6,126  $   6,126
  Non-performing assets /
   Total assets                 1.14%      1.14%      1.07%      1.07%
  Allowance for loan
   losses / Total loans         1.01%      1.01%      1.24%      1.24%
  Allowance for loan
   losses / Non-performing
   Assets                       61.2%      61.2%      73.8%      73.8%

 END OF PERIOD BALANCES
  Total loans, net of
   unearned income         $ 388,264  $ 388,264  $ 364,343  $ 364,343
  Allowance for loan loss  $   3,937  $   3,937  $   4,522  $   4,522
  Total assets             $ 565,674  $ 565,674  $ 569,987  $ 569,987
  Deposits                 $ 413,152  $ 413,152  $ 412,178  $ 412,178
  Stockholders' equity     $  58,504  $  58,504  $  56,111  $  56,111
  Full-time equivalent
   employees                     280        280        271        271

 AVERAGE BALANCES
  Loans                    $ 385,126  $ 378,733  $ 368,324  $ 349,047
  Total earning assets     $ 488,798  $ 485,624  $ 506,594  $ 501,689
  Total assets             $ 555,452  $ 552,657  $ 553,465  $ 549,954
  Deposits                 $ 411,948  $ 412,587  $ 408,247  $ 400,085
  Stockholders' equity     $  57,830  $  57,607  $  54,702  $  52,434


                              Rurban Financial Corp.
                                Segment Reporting
                       Third Quarter Ended September 30, 2007
                         --------------------------------
                                       RFCBC
                                       (Loan
 Income Statement        State Bank   Workout      Total
  Measures               and Trust    Company)    Banking
 ----------------        --------------------------------
 Interest Income         $  8,383    $     --    $  8,383

 Interest Expense           4,213          --       4,213

 Net Interest Income        4,170          --       4,170

 Provision For Loan Loss      150         (10)        140

 Non-interest Income        1,769          --       1,769

 Non-interest Expense       4,804          69       4,873

 Net Income Before Taxes      985         (59)        926

 Income Taxes                 271         (20)        251

 Net Income QTD          $    714    $    (39)   $    675

 Performance Measures
 --------------------
 Average  Assets -QTD    $535,129    $  1,341    $536,470

 ROAA                        0.53%         --        0.50%

 Average Equity - QTD    $ 55,534    $  1,270    $ 56,804

 ROAE                        5.15%         --        4.76%

 Efficiency Ratio - %       78.97%         --       80.14%

 Average Loans - QTD     $386,337    $    574    $386,911

 Average Deposits - QTD  $418,764    $     --    $418,764

                         ---------------------------------------------
                                      Parent
                                      Company                 Rurban
 Income Statement           Data        and    Elimination   Financial
  Measures               Processing    Other     Entries       Corp.
 ----------------        ---------------------------------------------
 Interest Income         $     --    $      1    $    (34)   $  8,350

 Interest Expense              53         457         (34)   $  4,689

 Net Interest Income          (53)       (456)         --    $  3,661

 Provision For Loan Loss       --          --          --    $    140

 Non-interest Income        5,385         356        (727)   $  6,783

 Non-interest Expense       4,334         627        (727)   $  9,107

 Net Income Before Taxes      998        (727)         --    $  1,197

 Income Taxes                 339        (257)         --    $    333

 Net Income QTD          $    659    $   (470)   $     --    $    864

 Performance Measures
 --------------------
 Average  Assets -QTD    $ 19,739    $ 79,380    $(80,137)   $555,452

 ROAA                       13.35%         --          --        0.62%

 Average Equity - QTD    $ 14,732    $ 57,830    $(71,536)   $ 57,830

 ROAE                       17.89%         --          --        5.97%

 Efficiency Ratio - %       80.04%         --          --       85.47%

 Average Loans - QTD     $     --    $     --    $ (1,785)   $385,126

 Average Deposits - QTD  $     --    $     --    $ (6,816)   $411,948

                               Rurban Financial Corp.
                                 Segment Reporting
                        Nine Months Ended September 30, 2007
                         --------------------------------
                                       RFCBC
                                       (Loan
 Income Statement        State Bank   Workout      Total
  Measures               and Trust    Company)    Banking
 ----------------        --------------------------------
 Interest Income         $ 24,721    $      1    $ 24,722

 Interest Expense          12,148          --      12,148

 Net Interest Income       12,573           1      12,574

 Provision For Loan Loss      400         (21)        379

 Non-interest Income        5,532          --       5,532

 Non-interest Expense      14,500         421      14,921

 Net Income Before Taxes    3,205        (399)      2,806

 Income Taxes                 866        (135)        731

 Net Income YTD          $  2,339    $   (264)   $  2,075

 Performance Measures

 Average  Assets - YTD   $532,945    $  1,599    $534,544

 ROAA                        0.59%         --        0.52%

 Average Equity - YTD    $ 55,091    $  1,372    $ 56,463

 ROAE                        5.66%         --        4.90%

 Efficiency Ratio - %       78.20%         --       80.52%

 Average Loans - YTD     $380,221    $    590    $380,811

 Average Deposits - YTD  $420,483    $     --    $420,483

                         ---------------------------------------------
                                      Parent
                                      Company                 Rurban
 Income Statement           Data        and    Elimination   Financial
  Measures               Processing    Other     Entries       Corp.
 ----------------        ---------------------------------------------
 Interest Income         $      1    $      3    $   (125)   $ 24,601

 Interest Expense             221       1,352        (125)     13,596

 Net Interest Income         (220)     (1,349)         --      11,005

 Provision For Loan Loss       --          --          --         379

 Non-interest Income       15,656       1,051      (2,209)     20,030

 Non-interest Expense      12,671       2,090      (2,209)     27,473

 Net Income Before Taxes    2,765      (2,388)         --       3,183

 Income Taxes                 940        (839)         --         832

 Net Income YTD          $  1,825    $ (1,549)   $     --    $  2,351

 Performance Measures

 Average  Assets - YTD   $ 20,237    $ 79,294    $(81,418)   $552,657

 ROAA                       12.02%         --          --        0.57%

 Average Equity - YTD    $ 14,172    $ 57,607    $(70,635)   $ 57,607

 ROAE                       17.17%         --          --        5.44%

 Efficiency Ratio - %       80.83%         --          --       86.79%

 Average Loans - YTD     $     --    $     --    $ (2,078)   $378,733

 Average Deposits - YTD  $     --    $     --    $ (7,896)   $412,587

                             Rurban Financial Corp.
                       Proforma Performance Measurement
                   Quarterly Comparison - Third Quarter 2007
                      ---------------------------------
                                     RFCBC      Banking
                      State Bank (Loan Workout  Related
 Average Assets       and Trust    Company)    Entities
 --------------       ---------------------------------
  3Q07                $ 535,129   $   1,341   $ 536,470
  2Q07                $ 529,071   $   1,547   $ 530,618
  1Q07                $ 534,629   $   1,914   $ 536,543
  4Q06                $ 549,777   $   2,178   $ 551,955
  3Q06                $ 549,931   $   2,451   $ 552,382
   3rd Quarter
    Comparison        $ (14,802)  $  (1,110)  $ (15,912)

 Revenue
 -------
  3Q07                $   5,939   $      --   $   5,939
  2Q07                $   6,130   $      --   $   6,130
  1Q07                $   6,024   $       1   $   6,025
  4Q06                $   6,345   $     124   $   6,469
  3Q06                $   6,393   $       3   $   6,396
   3rd Quarter
    Comparison        $    (454)  $      (3)  $    (457)

 Non-interest
  Expenses
 ------------
  3Q07                $   4,804   $      69   $   4,873
  2Q07                $   4,712   $     137   $   4,849
  1Q07                $   4,973   $     215   $   5,188
  4Q06                $   5,747   $     278   $   6,025
  3Q06                $   4,970   $     161   $   5,131
   3rd Quarter
    Comparison        $    (166)  $     (92)  $    (258)

 Net Income
 ----------
  3Q07                $     714   $     (39)  $     675
  2Q07                $     917   $     (87)  $     830
  1Q07                $     707   $    (136)  $     571
  4Q06                $     569   $     (89)  $     480
  3Q06                $     872   $     (82)  $     790
   3rd Quarter
    Comparison        $    (158)  $      43   $    (115)

 Efficiency Ratio
 ----------------
  3Q07                    78.97%         --       80.14%
  2Q07                    74.99%         --       77.23%
  1Q07                    82.20%         --       85.47%
  4Q06                    88.78%         --       91.37%
  3Q06                    75.96%         --       78.44%
   3rd Quarter
    Comparison             3.01%         --        1.70%

 NPA/Total Assets
 ----------------
  3Q07                     1.07%         --          --
  2Q07                     1.03%         --          --
  1Q07                     0.66%         --          --
  4Q06                     0.61%         --          --
  3Q06                     0.90%         --          --
   3rd Quarter
    Comparison             0.18%         --          --

 ROAA
 ----
  3Q07                     0.53%         --        0.50%
  2Q07                     0.69%         --        0.63%
  1Q07                     0.53%         --        0.43%
  4Q06                     0.41%         --        0.35%
  3Q06                     0.63%         --        0.57%
   3rd Quarter
    Comparison            (0.10%)        --        0.03%

 ROAE
 ----
  3Q07                     5.15%         --        4.76%
  2Q07                     6.68%         --        5.90%
  1Q07                     5.16%         --        4.05%
  4Q06                     4.20%         --        3.43%
  3Q06                     6.72%         --        5.83%
   3rd Quarter
    Comparison            (1.57%)        --       (0.26%)

 Average Equity
 --------------
  3Q07                $  55,534   $   1,270   $  56,804
  2Q07                $  54,905   $   1,344   $  56,249
  1Q07                $  54,828   $   1,502   $  56,330
  4Q06                $  54,249   $   1,714   $  55,963
  3Q06                $  51,917   $   2,261   $  54,178
   3rd Quarter
    Comparison        $   3,617   $    (991)  $   2,626

                      -----------------------------------------------
                                   Parent    Intersegment    Rurban
                                   Company    Elimination   Financial
 Average Assets           RDSI    and Other     Entries       Corp.
 --------------       -----------------------------------------------
  3Q07                $  19,739   $  79,380   $ (80,137)   $ 555,452
  2Q07                $  20,320   $  78,908   $ (80,420)   $ 549,426
  1Q07                $  20,217   $  79,251   $ (81,380)   $ 554,631
  4Q06                $  19,695   $  78,234   $ (80,077)   $ 569,807
  3Q06                $  14,442   $  75,666   $ (89,023)   $ 553,465
   3rd Quarter
    Comparison        $   5,297   $   3,714   $      --    $   1,987

 Revenue
 --------
  3Q07                $   5,332   $    (100)  $    (727)   $  10,444
  2Q07                $   4,949   $     (82)  $    (739)   $  10,258
  1Q07                $   5,155   $    (116)  $    (732)   $  10,332
  4Q06                $   4,944   $     247   $    (500)   $  11,160
  3Q06                $   4,085   $    (219)  $    (603)   $   9,659
   3rd Quarter
    Comparison        $   1,247   $     119   $      --    $     785

 Non-interest
  Expenses
 ------------
  3Q07                $   4,334   $     627   $    (727)   $   9,107
  2Q07                $   4,228   $     728   $    (739)   $   9,065
  1Q07                $   4,109   $     736   $    (732)   $   9,301
  4Q06                $   4,026   $     822   $    (514)   $  10,359
  3Q06                $   3,375   $     612   $    (603)   $   8,515
   3rd Quarter
    Comparison        $     959   $      15   $      --    $     592

 Net Income
 ----------
  3Q07                $     659   $    (470)  $      --    $     864
  2Q07                $     476   $    (521)  $      --    $     785
  1Q07                $     690   $    (559)  $      --    $     702
  4Q06                $     606   $    (376)  $      --    $     710
  3Q06                $     478   $    (454)  $      --    $     814
   3rd Quarter
    Comparison        $     181   $     (16)  $      --    $      50

 Efficiency Ratio
 ----------------
  3Q07                    80.04%         --          --        85.47%
  2Q07                    84.09%         --          --        86.61%
  1Q07                    78.52%         --          --        88.33%
  4Q06                    80.40%         --          --        91.34%
  3Q06                    82.20%         --          --        86.80%
   3rd Quarter
    Comparison            (2.17%)        --          --        (1.33%)

 NPA/Total Assets
 ----------------
  3Q07                       --          --          --         1.14%
  2Q07                       --          --          --         1.09%
  1Q07                       --          --          --         0.75%
  4Q06                       --          --          --         0.70%
  3Q06                       --          --          --         1.07%
   3rd Quarter
    Comparison               --          --          --        (0.86%)

 ROAA
 ----
  3Q07                    13.35%         --          --         0.62%
  2Q07                     9.37%         --          --         0.57%
  1Q07                    13.65%         --          --         0.51%
  4Q06                    12.31%         --          --         0.50%
  3Q06                    13.24%         --          --         0.59%
   3rd Quarter
    Comparison             0.03%         --          --         0.03%

 ROAE
 ----
  3Q07                    17.89%         --          --         5.97%
  2Q07                    13.43%         --          --         5.45%
  1Q07                    20.63%         --          --         4.91%
  4Q06                    19.06%         --          --         5.08%
  3Q06                    21.26%         --          --         5.95%
   3rd Quarter
    Comparison            (0.26%)        --          --        (0.26%)

 Average Equity
 --------------
  3Q07                $  14,732   $  57,830   $ (71,536)   $  57,830
  2Q07                $  14,182   $  57,617   $ (70,431)   $  57,617
  1Q07                $  13,378   $  57,192   $ (69,708)   $  57,192
  4Q06                $  12,721   $  55,963   $ (68,684)   $  55,963
  3Q06                $   8,995   $  54,702   $ (63,173)   $  54,702
   3rd Quarter
    Comparison        $   5,737   $   3,128   $      --    $   3,128


            

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