UBMT United Financial

United Financial Corp. Announces June 30, 2005 Earnings and Declares Quarterly Dividend HIGHLIGHTS: Total assets of $373 million; 2005 Q2 Net interest income up 7.9% over 2004 Q2; 2005 Q2 EPS of $.41 vs. 2004 Q2 EPS of $.39 GREAT FALLS, Mont., July 28 /PRNewswire-FirstCall/ -- United Financial Corp. ("United") (NASDAQ:UBMT) today reported net income for the quarter ended June 30, 2005 of $1,005,361, or basic earnings per share of $.41 and $.40 per share on a fully diluted basis. This compares to June 30, 2004 earnings of $945,769, or basic earnings per share of $.39 and $.38 on a fully diluted basis. Net income for the six-month period ended June 30, 2005 was $1,873,206, or basic and diluted earnings per share of $.77 and $.75, respectively, compared to $1,919,959, or basic earnings per share of $.79 and $.76 on a fully diluted basis in the same period a year ago. United's assets at June 30, 2005 were $373 million, an increase of 10.4% from a year ago. Net loans were $289 million at June 30, 2005 compared to $252 million at June 30, 2004, an increase of 14.6%. Net interest income rose to $3.5 million in the quarter ended June 30, 2005 compared to $3.2 million for the same quarter a year ago, an increase of 7.9%. United's shareholders' equity was $31.2 million at June 30, 2005, and book value per share was $12.75. Outstanding shares at June 30, 2005 were 2,444,980, compared to 2,433,965 at June 30, 2004. CEO, Kevin Clark, said, "This represents a solid quarter for United. Our net interest income was up $.3 million over the same three month period last year and our return on equity was over 13%. Asset quality remains pristine and net loans are up 15% over a year ago. Our Billings branch, which opened in the second quarter of 2004, is now contributing to the overall profitability of United. " United's net interest margin was 4.15% for the first six months of 2005 compared to 4.16% for the first six months of 2004. United had no non-accrual loans at June 30, 2005. Non-performing loans totaled $.1 million at June 30, 2005 and $.4 million at June 30, 2004. United's past due ninety days and non- accrual loans totaled .02% of loans at June 30, 2005, compared to .54% for that of its peer bank holding companies at March 31, 2005 the most recent peer information available. United declared a regular quarterly dividend of $.28 per share to shareholders of record on August 18, 2005, payable September 1, 2005. This represents a yield of 4.7% annualized on a stock price of $24.00 per share. Forward-Looking Statements When used in this press release, the words or phrases 'will likely result in', 'are expected to', 'will continue', 'is anticipated', 'estimate', 'could', or 'project' or similar expressions are intended to identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from historical earnings and those presently anticipated or projected including general economic conditions, business conditions in the banking industry, the regulatory environment, new legislation, vendor quality and efficiency, employee retention factors, rapidly changing technology and evolving banking industry standards, competitive standards, competitive factors including increased competition among financial institutions and fluctuating interest rate environments. Readers are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Readers should also carefully review the risk factors described in documents the company files from time to time with the Securities and Exchange Commission. United Financial Corp. is a bank holding company based in Great Falls, Montana, and is the parent of Heritage Bank, a full service community bank with fifteen locations in Montana. United Financial Corp. Financial Highlights (Unaudited) (Dollars in thousands, except per share data) Three Months Ended Six Months Ended June 30, June 30, 2005 2004 2005 2004 Income statement amounts Net interest income $3,494 $3,239 $6,775 $6,279 Provision for losses on loans 50 18 50 70 Noninterest income Investment securities gains - - - 213 Gain on the sale of loans 757 621 1,294 1,282 Other 339 462 632 656 Noninterest expense 2,920 2,865 5,637 5,281 Earnings before income taxes 1,620 1,516 3,014 3,079 Income taxes 615 570 1,141 1,159 Net earnings 1,005 946 1,873 1,920 Per common share data Net earnings - basic $0.41 $0.39 0.77 0.79 - diluted 0.40 0.38 0.75 0.76 Cash dividends 0.28 1.27 0.56 1.54 Book value 12.75 12.16 Balances at end of period Loans receivable and held for sale, gross 301,809 264,171 Allowance for losses on loans 3,598 3,733 Nonperforming assets Nonperforming loans 72 370 Foreclosed properties - 592 Available-for-sale investment securities 36,359 42,637 Total assets 372,767 334,063 Goodwill 1,422 1,422 Total deposits 273,204 240,806 Total stockholders' equity 31,231 29,601 Other supplemental information Net earnings Return on average assets 1.06% 1.20% Return on average common equity 12.28% 12.12% Allowance for loan losses to loans 1.19% 1.41% Common shares outstanding (end of period, in thousands) 2,450 2,434 Net interest margin 4.15% 4.16% Shareholders' equity to total assets 8.38% 8.86% Dividend payout ratio 72.73% 194.94% DATASOURCE: United Financial Corp. CONTACT: Kevin P. Clark, CEO of United Financial Corp., +1-406-727-6106

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