FFW Corporation Announces Operating Results for the Quarter and Year to Date Ended December 31, 2008

WABASH, IN--(Marketwire - January 28, 2009) - FFW Corporation (OTCBB: FFWC) (1/27/2009 Close: $14.00), parent corporation (the "Corporation") of Crossroads Bank, announced operating results for the three and six months ended December 31, 2008.

For the three months ended December 31, 2008, the Corporation reported net income of $749,000. After deducting preferred stock dividends, the net income available to common shareholders for the same period was $736,000 or $0.69 per diluted share. This is compared to net income of $651,000 or $0.55 per diluted share for the quarter ended December 31, 2007. The earnings increase for the second quarter of fiscal year 2009 reflected an increase of approximately 13.1% over the same period in fiscal year 2008. The increase is due to higher net interest income, partially offset by an increase to the provision for loan losses.

For the six months ended December 31, 2008, the Corporation reported net loss of ($2,406,000). After deducting preferred stock dividends, the net loss for common shareholders for the same period was ($2,419,000) or ($2.19) per diluted share. This is compared to net income of $1,285,000 or $1.08 per diluted share for the six months ended December 31, 2007. The six months ended December 31, 2008 includes a non-cash impairment charge of $6,692,000 related to certain Federal National Mortgage Association ("Fannie Mae") preferred stocks. These securities were sold prior to December 31, 2008. Losses on these securities are considered ordinary with respect to federal income taxes; therefore, an ordinary tax benefit of $2,748,000 was recognized. Excluding the non-cash impairment charge and related tax benefit, net income available to common shareholders for the six months ended December 31, 2008 would have been approximately $1,525,000, which represents an increase of approximately 18.7% from the six months ended December 31, 2007.

Roger K. Cromer, President and Chief Executive Officer, stated, "We are pleased with our quarterly performance in a challenging economic environment. We were able to grow our loan portfolio by $5.5 million during the first six months of our fiscal year. Our participation in the Capital Purchase Program will further increase our capacity to support economic activity and growth in each of the communities we serve through responsible lending."

The three and six month periods ended December 31, 2008 represent a return on average common equity of 14.09% and (22.49%), respectively. Return on average total assets for the three and six month periods ended December 31, 2008 was 0.94% and (1.50%).

The allowance for loan losses as a percentage of gross loans receivable was 1.42% at December 31, 2008 and 1.20% at June 30, 2008. Nonperforming assets decreased to $2.4 million at December 31, 2008 from $3.3 million at June 30, 2008.

As of December 31, 2008, FFWC's equity-to-assets ratio was 8.46% compared to 7.46% at June 30, 2008. Total assets at December 31, 2008 were $327.4 million compared to $315.9 million at June 30, 2008. Shareholders' equity was $27.7 million at December 31, 2008 compared to $23.6 million at June 30, 2008. Shareholders' equity at December 31, 2008 was increased by $7.3 million upon completion of the sale of preferred stock under the U.S. Department of the Treasury's Capital Purchase Program. The transaction was completed on December 19, 2008 and resulted in FFW Corporation issuing 7,289 shares of Fixed Rate Cumulative Perpetual Preferred Stock, Series A, with a liquidation preference of $1,000 per share paying dividends at an annual rate of 5% and 364 shares of Fixed Rate Cumulative Perpetual Preferred Stock, Series B, with a liquidation preference of $1,000 per share paying dividends at an annual rate of 9%. At December 31, 2008, 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 Sheets

                                                 12/31/2008     6/30/2008
                                                ------------  ------------
                                                  Unaudited
Assets

Cash and due from financial institutions        $  6,374,271  $  6,095,999
Interest-earning deposits in other financial
 institutions - short term                         8,039,441     2,347,131
                                                ------------  ------------
Cash and cash equivalents                         14,413,712     8,443,130

Securities available for sale                     57,098,872    60,367,678
Loans receivable, net of allowance for loan
 losses of $3,355,057 at December 31, 2008 and
 $2,768,622 at June 30, 2008                     232,732,254   227,839,891
Loans held for sale                                  752,100        77,000
Federal Home Loan Bank stock, at cost              3,627,100     3,627,100
Accrued interest receivable                        1,894,090     1,560,163
Premises and equipment, net                        4,102,618     4,040,369
Mortgage servicing rights                            223,273       488,452
Cash surrender value of life insurance             5,946,427     5,815,227
Goodwill                                           1,213,898     1,213,898
Other assets                                       5,404,335     2,412,579
                                                ------------  ------------
Total Assets                                    $327,408,679  $315,885,487
                                                ============  ============

Liabilities and Shareholders' Equity

Liabilities:
Noninterest-bearing deposits                    $ 12,593,381  $ 13,737,624
Interest-bearing deposits                        245,140,803   230,446,720
                                                ------------  ------------
Total Deposits                                   257,734,184   244,184,344

Federal Home Loan Bank advances                   38,848,030    45,283,087
Accrued expenses and other liabilities             3,124,896     2,856,193
                                                ------------  ------------
Total Liabilities                                299,707,110   292,323,624

Shareholders' Equity:
Preferred stock, $.01 par; 500,000 shares
 authorized;
   Series A, 5% Fixed Rate Cumulative Perpetual
    Preferred Stock - 7,289 shares outstanding
    December 31, 2008                              6,882,079            --
   Series B, 9% Fixed Rate Cumulative Perpetual
    Preferred Stock - 364 shares outstanding
    December 31, 2008                                406,921            --
Common stock, $.01 par; 2,000,000 shares
 authorized;                                          18,363        18,363
   issued: 1,836,328, outstanding: 1,112,260 -
    December 31, 2008

   issued: 1,836,328, outstanding: 1,100,260 -
    June 30, 2008
Additional paid-in capital                         9,415,709     9,530,608
Retained earnings                                 23,056,443    25,965,339
Accumulated other comprehensive income (loss)       (957,959)     (653,825)
Treasury stock at cost, shares: 724,068 -
 December 31, 2008 and 736,068 - June 30, 2008   (11,119,987)  (11,298,622)
                                                ------------  ------------
Total Shareholders' Equity                        27,701,569    23,561,863
                                                ------------  ------------

Total Liabilities and Shareholders' Equity      $327,408,679  $315,885,487
                                                ============  ============





Consolidated Statements of Income

                             Three Months Ended        Six Months Ended
                           12/31/2008  12/31/2007  12/31/2008   12/31/2007
                           ----------- ----------- -----------  -----------
                            Unaudited   Unaudited    Unaudited   Unaudited
Interest and dividend
 income:
   Loans, including fees   $ 3,833,061 $ 3,970,507 $ 7,958,892  $ 7,891,925
   Taxable securities          565,538     664,188   1,273,642    1,278,251
   Nontaxable securities       187,476     163,581     364,191      305,389
   Other                         6,327      23,006      28,873       53,398
                           ----------- ----------- -----------  -----------
      Total interest and
       dividend income       4,592,402   4,821,282   9,625,598    9,528,963

Interest expense:
   Deposits                  1,660,641   1,954,652   3,497,268    3,894,956
   Borrowings                  481,435     714,313     988,148    1,422,009
                           ----------- ----------- -----------  -----------
      Total interest
       expense               2,142,076   2,668,965   4,485,416    5,316,965

Net interest income          2,450,326   2,152,317   5,140,182    4,211,998

Provision for loan losses      285,000     120,000     714,000      240,000

Net interest income after
 provision for loan losses   2,165,326   2,032,317   4,426,182    3,971,998

Noninterest income:
   Net gains on sales of
    securities                 187,336      48,830     187,336       48,830
   Net gains on sales of
    loans                       38,217      24,821      58,026       47,441
   Other than temporary
    impairment on securities         -           -  (6,692,000)           -
   Commission income           142,322     135,058     288,645      261,652
   Service charges and fees     97,103     250,905     403,231      556,584
   Earnings on life
    insurance                   75,282      66,617     145,055      132,965
   Other                        54,926      44,027      53,819       87,674
                           ----------- ----------- -----------  -----------
      Total noninterest
       income (loss)           595,186     570,258  (5,555,888)   1,135,146

Noninterest expense:
   Salaries and benefits       915,578     866,737   1,832,020    1,732,730
   Occupancy and equipment     209,804     202,856     413,782      405,768
   Professional                 67,037      70,186     121,034      122,430
   Marketing                    31,875      90,538      82,304      125,895
   Deposit insurance
    premium                     44,274       6,066      83,353       12,190
   Regulatory assessment        23,080      21,608      46,161       43,216
   Correspondent bank
    charges                     18,426      20,881      39,938       45,097
   Data processing             127,423     135,452     257,743      295,317
   Printing, postage and
    supplies                    61,927      50,518     119,570       94,522
   Expense on life insurance    21,507         900      46,381       26,629
   Contribution expense         16,540       6,828      29,081       12,001
   Other                       232,524     248,445     466,234      450,355
                           ----------- ----------- -----------  -----------
      Total noninterest
       expense               1,769,995   1,721,015   3,537,601    3,366,150

Income (loss) before
 income taxes                  990,517     881,560  (4,667,307)   1,740,994

Income tax expense
 (benefit)                     241,514     230,457  (2,261,050)     455,499

Net income (loss)          $   749,003 $   651,103 $(2,406,257) $ 1,285,495
                           =========== =========== ===========  ===========





                              Three Months Ended       Six Months Ended
                            12/31/2008  12/31/2007  12/31/2008  12/31/2007
                            ----------  ----------  ----------  ----------
                             Unaudited   Unaudited   Unaudited   Unaudited
Earnings per common share:
Primary                     $     0.69  $     0.56  $    (2.19) $     1.09
Fully diluted               $     0.69  $     0.55  $    (2.19) $     1.08
Dividend paid per share     $     0.22  $     0.21  $     0.44  $     0.42
Average shares outstanding   1,112,260   1,180,496   1,110,619   1,187,686
Shares outstanding end of
 period                      1,112,260   1,170,768   1,112,260   1,170,768

Supplemental data:
Net interest margin **            3.23%       3.05%       3.38%       3.02%
Return on average assets ***      0.94%       0.87%      -1.50%       0.87%
Return on average common
 equity ***                      14.09%      10.14%     -22.49%      10.07%

                            12/31/2008   6/30/2008
                            ----------  ----------
Nonperforming assets *      $2,396,978  $3,262,262
Repossessed assets          $  955,759  $  846,785

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

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