1st Defiance Reports Sale-Linked Settlement

First Defiance Financial Corp., Defiance, Ohio, has entered into a settlement for contingent liabilities incurred as a result of the sale of its Leader Mortgage Co. subsidiary to U.S. Bank NA, Minneapolis.The sale took place in January 2002. The settlement will result in a pretax charge of $1.9 million for First Defiance that will be recorded in the third quarter of 2004, the company said. After tax, the charge amounts to $1.25 million, or $0.20 per share. Leader and U.S. Bank were seeking repayment for "'charges, advancements, and other Payments' that Leader made and for which it was not reimbursed," said a First Defiance 10-Q filing in August. William J. Small, chairman, president, and chief executive officer of First Defiance, stressed that the settlement "in no way relates to any of our existing operations and will not have any impact on our operating results going forward. We previously recognized an after-tax gain from the sale of Leader of $7.7 million, or $1.16 per share, so even with the recognition of this item, we are still satisfied with that transaction."