FDEF First Defiance Financial Corporation

DEFIANCE, Ohio, March 12 /PRNewswire-FirstCall/ -- First Defiance Financial Corp. (NASDAQ:FDEF) and Pavilion Bancorp, Inc. today announced Pavilion shareholder approval of the merger of Pavilion, and its subsidiary, the Bank of Lenawee, into First Defiance. The transaction is anticipated to close on Friday March 14, 2008. Shareholders approved the transaction, announced last October, at a special meeting held March 11 in Adrian, Michigan. Each Pavilion Bancorp shareholder will receive 1.4209 shares of First Defiance common stock and $37.50 in cash. Based on the closing price of First Defiance shares on March 11, 2008, the transaction is valued at $48.0 million or $65.04 per share. Upon completion of the acquisition, on a pro forma basis using December 31, 2007 data, First Defiance Financial Corp. will have $1.7 billion in total assets and $1.4 billion in total deposits. The Bank of Lenawee has eight banking offices and $273.6 million in assets. Combined, the offices had $205.2 million in deposits and $237.0 million in net loans as of December 31, 2007. All eight offices will be rebranded as First Federal Bank upon completion of the acquisition. About First Defiance Financial Corp. First Defiance Financial Corp., headquartered in Defiance, Ohio, is the holding company for First Federal Bank of the Midwest and First Insurance & Investments. First Federal operates 28 full service branches, and 36 ATM locations in northwest Ohio and northeast Indiana. First Insurance & Investments is the largest property and casualty insurance company in the Defiance, Ohio area and specializes in life and group health insurance and financial planning. For more information, visit the company's Web site at http://www.fdef.com/. About Pavilion Bancorp, Inc. Pavilion Bancorp, Inc. is the parent corporation of the Bank of Lenawee, based in Adrian, Michigan. Chartered in 1869, the Bank of Lenawee is an independent, community bank that provides a broad range of financial services through a network of eight branch offices and nine ATMs located in Lenawee and Hillsdale counties in Michigan. The bank also offers mortgage products provided by Pavilion Mortgage Company, a subsidiary of the Bank of Lenawee. For more information, visit the company's website at http://www.pavilionbancorp.com/. Safe Harbor Statement This release may contain forward-looking statements about First Defiance Financial Corp., Pavilion Bancorp, Inc., and/or the combined company within the meaning of Sections 27A of the Securities Act of 1933, as amended, and Rule 175 promulgated thereunder, and 21E of the Securities Exchange Act of 1934, as amended, and Rule 3b-6 promulgated thereunder, that involve inherent risks and uncertainties. This press release may contain certain forward- looking statements with respect to the financial condition, results of operations, plans, objectives, future performance and business of First Defiance Financial Corp., Pavilion Bancorp, Inc., and/or the combined company including statements preceded by, followed by or that include the words or phrases such as "believes," "expects," "anticipates," "plans," "trend," "objective," "continue," "remain" or similar expressions or future or conditional verbs such as "will," "would," "should," "could," "might," "can," "may" or similar expressions. There are a number of important factors that could cause future results to differ materially from historical performance and these forward-looking statements. Factors that might cause such a difference include, but are not limited to: (1) competitive pressures among depository institutions increase significantly; (2) changes in the interest rate environment reduce interest margins; (3) prepayment speeds, loan origination and sale volumes, charge-offs and loan loss provisions; (4) general economic conditions, either national or in the counties in which First Defiance Financial Corp., Pavilion Bancorp, Inc., and/or the combined company do business, are less favorable than expected; (5) political developments, wars or other hostilities may disrupt or increase volatility in securities markets or other economic conditions; (6) changes and trends in the securities markets; (7) legislative or regulatory changes or actions, or significant litigation, adversely affect First Defiance Financial Corp., Pavilion Bancorp, Inc., and/or the combined company or the businesses in which First Defiance Financial Corp., Pavilion Bancorp, Inc., and/or the combined company are engaged; (8) difficulties in combining the operations of Pavilion Bancorp, Inc., and/or other acquired entities and (9) the impact of reputational risk created by the developments discussed above on such matters as business generation and retention, funding and liquidity. We undertake no obligation to release revisions to these forward-looking statements or reflect events or circumstances after the date of this release. Further information on other factors which could affect the financial results of First Defiance Financial Corp. after the merger are included in First Defiance Financial Corp. and Pavilion Bancorp, Inc.'s filings with the Securities and Exchange Commission. These documents are available free of charge at the Commission's website at http://www.sec.gov/. DATASOURCE: First Defiance Financial Corp. CONTACT: William J. Small, Chairman, CEO & President of First Defiance Financial Corp., +1-419-782-5015, Web site: http://www.fdef.com/ http://www.pavilionbancorp.com/

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