First Defiance Financial has reported that its net income for the second quarter ended June 30, 2008 totaled $2.74 million, or $0.34 per diluted share, a decrease as compared to $3.61 million or $0.50 per diluted share for the same quarter of 2007.

Net interest income increased to $16.2 million for the quarter, a 34% increase from $12.1 million of net interest income earned in 2007 second quarter. Net interest margin improved to 3.92% for the 2008 second quarter, a 34 basis point improvement over 2007’s same quarter margin of 3.58%.

For the six-month period ended June 30, 2008, First Defiance earned $6.15 million or $0.80 per share, a decline compared with $7.22 million or $1 per share for the six-month period ended June 30, 2007.

Net interest income totaled $29.8 million for the six-month period, a $5.7 million or 23.8% increase over the first half of 2007. Net interest margin for the first six months of 2008 was 3.85%, up 24 basis points from the 3.61% margin reported during the comparable period of 2007.

Total assets at June 30, 2008 were $1.93 billion, up as compared to $1.61 billion at December 31, 2007. Net loans receivable were $1.56 billion at June 30, 2008 compared to $1.28 billion at December 31, 2007. Likewise total deposits for the same dates increased to $1.43 billion from $1.22 billion.

William Small, chairman, president and CEO of First Defiance, said: Like most banks, we navigated into strong headwinds this quarter, especially on the credit side. Despite the bottom-line quarterly results, I believe there are a lot of positive developments this quarter.