**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**WASHINGTON,      D.C. 20549**

**FORM      10-QSB**

| x | QUARTERLY                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF                1934 |
|---|-----------------------------------------------------------------------------------------------------------------|

| o | TRANSITION                REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE                ACT |
|---|-----------------------------------------------------------------------------------------------|

| United                States                                                  | 81-0531318                                          |
|-------------------------------------------------------------------------------|-----------------------------------------------------|
| (State                or other jurisdiction of incorporation or organization) | (I.R.S.                Employer Identification No.) |

**APPLICABLE      ONLY TO CORPORATE ISSUERS**

| Common                stock, par value $0.01 per share | 1,085,357                shares outstanding |
|--------------------------------------------------------|---------------------------------------------|

----

|                          |   |                                                                                                                                                                                                                                    |   | PAGE                      |
|-------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------|
| PART                  I.      |   | FINANCIAL                  INFORMATION                                                                                                                                                                                                  |   |                      |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
| Item                  1.      |   | Financial                  Statements                                                                                                                                                                                                   |   |                      |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
|                          |   | Consolidated                  Statements of Financial Condition as of December 31, 2006 (unaudited)                  and                  June 30, 2006                                                                                 |   | 1                  and 2  |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
|                          |   | Consolidated                  Statements of Income for the three months ended December 31, 2006                  and 2005                  (unaudited) and the six months ended December 31, 2006 and 2005                  (unaudited) |   | 3                  and 4  |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
|                          |   | Consolidated                  Statements of Changes in Stockholders' Equity for the six months                  ended                  December 31, 2006                                                                                |   | 5                         |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
|                          |   | Consolidated                  Statements of Cash Flows for the six months ended December 31,                  2006 and                  2005 (unaudited)                                                                                |   | 6                  and 7  |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
|                          |   | Notes                  to Consolidated Financial Statements                                                                                                                                                                             |   | 8                  to 11  |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
| Item                  2.      |   | Management's                  Discussion and Analysis of Financial Condition and Results of                  Operations                                                                                                                 |   | 12                  to 17 |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
| Item                  3.      |   | Controls                  and Procedures                                                                                                                                                                                                |   | 18                        |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
| PART                  II.     |   | OTHER                  INFORMATION                                                                                                                                                                                                      |   |                      |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
| Item                  1.      |   | Legal                  Proceedings                                                                                                                                                                                                      |   | 19                        |
| Item                  2.      |   | Unregistered                  Sales of Equity Securities and Use of Proceeds                                                                                                                                                            |   | 19                        |
| Item                  3.      |   | Defaults                  Upon Senior Securities                                                                                                                                                                                        |   | 19                        |
| Item                  4.      |   | Submission                  of Matters to a Vote of Security-Holders                                                                                                                                                                    |   | 19                        |
| Item                  5.      |   | Other                  Information                                                                                                                                                                                                      |   | 20                        |
| Item                  6.      |   | Exhibits                                                                                                                                                                                                                                |   | 20                        |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
| Signatures                    |   |                                                                                                                                                                                                                                    |   | 21                        |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
| Exhibit                  31.1 |   |                                                                                                                                                                                                                                    |   |                           |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
| Exhibit                  31.2 |   |                                                                                                                                                                                                                                    |   |                           |
|                          |   |                                                                                                                                                                                                                                    |   |                      |
| Exhibit                  32.1 |   |                                                                                                                                                                                                                                    |   |                           |

----

|                                                                                                                                                                               |   | December                31,2006 |    | June                30,2006 |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-----------------------------|--------|
|                                                                                                                                                                               |   | (Unaudited)                     |    | (Audited)                   |   |
| ASSETS                                                                                                                                                                             |   |                            |    |                        |   |
| Cash                and due from banks                                                                                                                                             |   | $                               | 4,421   |                        | $      | 2,844 |   |
| Interest-bearing                deposits with banks                                                                                                                                |   |                            | 509     |                        |   | 27 |   |
| Total                cash and cash equivalents                                                                                                                                     |   |                            | 4,930   |                        |   | 2,871 |   |
|                                                                                                                                                                               |   |                            |         |                        |   |  |   |
| Investment                securities available-for-sale, at                market value                                                                                            |   |                            | 66,446  |                        |   | 64,198 |   |
| Investment                securities held-to-maturity, at                amortized cost                                                                                            |   |                            | 977     |                        |   | 1,018 |   |
| Investment                in Eagle Bancorp Statutory Trust I                                                                                                                       |   |                            | 155     |                        |   | 155 |   |
| Federal                Home Loan Bank stock, at cost                                                                                                                               |   |                            | 1,315   |                        |   | 1,315 |   |
| Mortgage                loans held-for-sale                                                                                                                                        |   |                            | 2,063   |                        |   | 918 |   |
| Loans                receivable, net of deferred loan fees and                allowance for loan losses of $520 at December                31, 2006 and $535 at June 30, 2006 |   |                            | 147,331 |                        |   | 140,858 |   |
| Accrued                interest and dividends receivable                                                                                                                           |   |                            | 1,280   |                        |   | 1,211 |   |
| Mortgage                servicing rights, net                                                                                                                                      |   |                            | 1,682   |                        |   | 1,722 |   |
| Property                and equipment, net                                                                                                                                         |   |                            | 5,938   |                        |   | 5,962 |   |
| Cash                surrender value of life insurance                                                                                                                              |   |                            | 5,664   |                        |   | 5,230 |   |
| Real                estate acquired in settlement of loans, net                of allowance for losses                                                                             |   |                            | — |                        |   | — |   |
| Other                assets                                                                                                                                                        |   |                            | 304     |                        |   | 720 |   |
|                                                                                                                                                                               |   |                            |    |                        |   |   |   |
| Total                assets                                                                                                                                                        |   | $                               | 238,085 |                        | $      | 226,178 |   |

----

|                                                                                                                                                                                                                                                                       |   | December                31,2006 |    | June                30,2006 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|-----------------------------|--------|
|                                                                                                                                                                                                                                                                       |   | (Unaudited)                     |    | (Audited)                   |   |
| LIABILITIES                AND STOCKHOLDERS' EQUITY                                                                                                                                                                                                                        |   |                            |    |                        |   |
| Liabilities:                                                                                                                                                                                                                                                               |   |                            |    |                        |   |
| Deposit                accounts:                                                                                                                                                                                                                                           |   |                            |    |                        |   |
| Noninterest                bearing                                                                                                                                                                                                                                         |   | $                               | 12,575  |                        | $      | 12,575 |   |
| Interest                bearing                                                                                                                                                                                                                                            |   |                            | 162,760 |                        |   | 161,767 |   |
| Advances                from Federal Home Loan Bank and Other Borrowings                                                                                                                                                                                                   |   |                            | 31,863  |                        |   | 22,371 |   |
| Long-term                subordinated debentures                                                                                                                                                                                                                           |   |                            | 5,155   |                        |   | 5,155 |   |
| Accrued                expenses and other liabilities                                                                                                                                                                                                                      |   |                            | 1,863   |                        |   | 1,765 |   |
| Total                liabilities                                                                                                                                                                                                                                           |   |                            | 214,216 |                        |   | 203,633 |   |
| Stockholders'                Equity:                                                                                                                                                                                                                                       |   |                            |         |                        |   |  |   |
| Preferred                stock (no par value, 1,000,000 shares authorized,                none issued or outstanding)                                                                                                                                                      |   |                            | — |                        |   | — |   |
| Common                stock (par value $0.01 per share;                9,000,000                shares authorized; 1,223,572 shares issued;                1,086,557 and 1,091,722 shares outstanding at December                31, 2006 and June 30, 2006, respectively) |   |                            | 12      |                        |   | 12 |   |
| Additional                paid-in capital                                                                                                                                                                                                                                  |   |                            | 4,330   |                        |   | 4,274 |   |
| Unallocated                common stock held by employee stock                ownership plan ("ESOP")                                                                                                                                                                      |   |                            | (110    | )                           |   | (129 | ) |
| Treasury                stock, at cost                                                                                                                                                                                                                                     |   |                            | (4,687  | )                           |   | (4,521 | ) |
| Retained                earnings                                                                                                                                                                                                                                           |   |                            | 24,746  |                        |   | 24,056 |   |
| Accumulated                other comprehensive income (loss)                                                                                                                                                                                                               |   |                            | (422    | )                           |   | (1,147 | ) |
| Total                stockholders' equity                                                                                                                                                                                                                                  |   |                            | 23,869  |                        |   | 22,545 |   |
|                                                                                                                                                                                                                                                                       |   |                            |         |                        |   |  |   |
| Total                liabilities and stockholders' equity                                                                                                                                                                                                                  |   | $                               | 238,085 |                        | $      | 226,178 |   |

----

|                                                             |   | Three                Months EndedDecember                31,  |    | Six                Months EndedDecember                31,  |   |
|------------------------------------------------------------------|--------|--------------------------------------------------------------------|---------|------------------------------------------------------------------|--------|
|                                                             |   | 2006                                                          |    | 2005                                                        |   | 2006  |   | 2005  |   |
|                                                             |   | (Unaudited)                                                   |    | (Unaudited)                                                      |   |
| Interest                and Dividend Income:                     |   |                                                               |    |                                                             |   |   |   |   |   |
| Interest                and fees on loans                        |   | $                                                                  | 2,378   |                                                             | $      | 1,897 |   | $ | 4,689 |   | $ | 3,687 |   |
| Interest                on deposits with banks                   |   |                                                               | 16      |                                                             |   | 36 |   |   | 28 |   |   | 47 |   |
| FHLB                stock dividends                              |   |                                                               | 1       |                                                             |   | — |   |   | 1 |   |   | — |   |
| Securities                available-for-sale                     |   |                                                               | 696     |                                                             |   | 640 |   |   | 1,356 |   |   | 1,263 |   |
| Securities                held-to-maturity                       |   |                                                               | 11      |                                                             |   | 13 |   |   | 22 |   |   | 27 |   |
| Total                interest and dividend income                |   |                                                               | 3,102   |                                                             |   | 2,586 |   |   | 6,096 |   |   | 5,024 |   |
|                                                             |   |                                                               |         |                                                             |   |  |   |   |  |   |   |  |   |
| Interest                Expense:                                 |   |                                                               |         |                                                             |   |  |   |   |  |   |   |  |   |
| Deposits                                                         |   |                                                               | 1,042   |                                                             |   | 717 |   |   | 1,976 |   |   | 1,383 |   |
| Advances                and other borrowings                     |   |                                                               | 355     |                                                             |   | 104 |   |   | 686 |   |   | 204 |   |
| Subordinated                debentures                           |   |                                                               | 75      |                                                             |   | 75 |   |   | 150 |   |   | 77 |   |
| Total                interest expense                            |   |                                                               | 1,472   |                                                             |   | 896 |   |   | 2,812 |   |   | 1,664 |   |
|                                                             |   |                                                               |         |                                                             |   |  |   |   |  |   |   |  |   |
| Net                interest income                               |   |                                                               | 1,630   |                                                             |   | 1,690 |   |   | 3,284 |   |   | 3,360 |   |
| Loan                loss provision                               |   |                                                               | — |                                                             |   | — |   |   | — |   |   | — |   |
| Net                interest income after loan loss provision     |   |                                                               | 1,630   |                                                             |   | 1,690 |   |   | 3,284 |   |   | 3,360 |   |
|                                                             |   |                                                               |         |                                                             |   |  |   |   |  |   |   |  |   |
| Noninterest                income:                               |   |                                                               |         |                                                             |   |  |   |   |  |   |   |  |   |
| Net                gain on sale of loans                         |   |                                                               | 190     |                                                             |   | 128 |   |   | 309 |   |   | 301 |   |
| Demand                deposit service charges                    |   |                                                               | 128     |                                                             |   | 136 |   |   | 263 |   |   | 279 |   |
| Mortgage                loan servicing fees                      |   |                                                               | 133     |                                                             |   | 130 |   |   | 271 |   |   | 321 |   |
| Net                gain on sale of available-for-sale securities |   |                                                               | 1       |                                                             |   | — |   |   | 1 |   |   | 1 |   |
| Other                                                            |   |                                                               | 140     |                                                             |   | 123 |   |   | 285 |   |   | 258 |   |
| Total                noninterest income                          |   |                                                               | 592     |                                                             |   | 517 |   |   | 1,129 |   |   | 1,160 |   |

----

|                                                             |   | Three                Months EndedDecember                31,  |      | Six                Months EndedDecember                31, |   |
|------------------------------------------------------------------|--------|--------------------------------------------------------------------|-----------|------------------------------------------------------------|--------|
|                                                             |   | 2006                                                          |      | 2005                                                  |   | 2006  |   | 2005 |   |
|                                                             |   | (Unaudited)                                                   |      | (Unaudited)                                           |   |
| Noninterest                expense:                              |   |                                                               |      |                                                       |   |   |   |   |   |
| Salaries                and employee benefits                    |   |                                                               | 914       |                                                       |   | 906 |   |   | 1,752 |   |   | 1,738 |   |
| Occupancy                expenses                                |   |                                                               | 133       |                                                       |   | 133 |   |   | 275 |   |   | 258 |   |
| Furniture                and equipment depreciation              |   |                                                               | 68        |                                                       |   | 78 |   |   | 147 |   |   | 157 |   |
| In-house                computer expense                         |   |                                                               | 70        |                                                       |   | 68 |   |   | 141 |   |   | 135 |   |
| Advertising                expense                               |   |                                                               | 60        |                                                       |   | 46 |   |   | 153 |   |   | 116 |   |
| Amortization                of mtg servicing fees                |   |                                                               | 73        |                                                       |   | 92 |   |   | 149 |   |   | 198 |   |
| Federal                insurance premiums                        |   |                                                               | 5         |                                                       |   | 6 |   |   | 11 |   |   | 12 |   |
| Postage                                                          |   |                                                               | 21        |                                                       |   | 19 |   |   | 39 |   |   | 42 |   |
| Legal,                accounting, and examination fees           |   |                                                               | 66        |                                                       |   | 61 |   |   | 124 |   |   | 95 |   |
| Consulting                fees                                   |   |                                                               | 20        |                                                       |   | 12 |   |   | 36 |   |   | 30 |   |
| ATM                processing                                    |   |                                                               | 10        |                                                       |   | 12 |   |   | 22 |   |   | 24 |   |
| Other                                                            |   |                                                               | 221       |                                                       |   | 204 |   |   | 428 |   |   | 424 |   |
| Total                noninterest expense                         |   |                                                               | 1,661     |                                                       |   | 1,637 |   |   | 3,277 |   |   | 3,229 |   |
|                                                             |   |                                                               |           |                                                       |   |  |   |   |  |   |   |  |   |
| Income                before provision for income taxes          |   |                                                               | 561       |                                                       |   | 570 |   |   | 1,136 |   |   | 1,291 |   |
|                                                             |   |                                                               |           |                                                       |   |  |   |   |  |   |   |  |   |
| Provision                for income taxes                        |   |                                                               | 100       |                                                       |   | 125 |   |   | 253 |   |   | 347 |   |
|                                                             |   |                                                               |           |                                                       |   |  |   |   |  |   |   |  |   |
| Net                income                                        |   | $                                                                  | 461       |                                                       | $      | 445 |   | $ | 883 |   | $ | 944 |   |
|                                                             |   |                                                               |           |                                                       |   |  |   |   |  |   |   |  |   |
| Basic                earnings per share                          |   | $                                                                  | 0.43      |                                                       | $      | 0.41 |   | $ | 0.82 |   | $ | 0.87 |   |
|                                                             |   |                                                               |           |                                                       |   |  |   |   |  |   |   |  |   |
| Diluted                earnings per share                        |   | $                                                                  | 0.38      |                                                       | $      | 0.37 |   | $ | 0.73 |   | $ | 0.78 |   |
|                                                             |   |                                                               |           |                                                       |   |  |   |   |  |   |   |  |   |
| Weighted                average shares outstanding (basic eps)   |   |                                                               | 1,072,540 |                                                       |   | 1,077,640 |   |   | 1,073,100 |   |   | 1,079,122 |   |
|                                                             |   |                                                               |           |                                                       |   |  |   |   |  |   |   |  |   |
| Weighted                average shares outstanding (diluted eps) |   |                                                               | 1,209,012 |                                                       |   | 1,204,412 |   |   | 1,208,435 |   |   | 1,203,835 |   |

----

|                                                                                                                       |   | PREFERREDSTOCK |    | COMMONSTOCK |   | ADDITIONALPAID-INCAPITAL |   | UNALLOCATEDESOPSHARES |    | TREASURYSTOCK |   | RETAINEDEARNINGS |   | ACCUMULATEDOTHERCOMPREHENSIVEINCOME |    | TOTAL  |   |
|----------------------------------------------------------------------------------------------------------------------------|--------|----------------|---------|-------------|--------|--------------------------|--------|-----------------------|---------|---------------|--------|------------------|--------|-------------------------------------|---------|--------|--------|
| Balance,                June 30, 2006                                                                                      |   | $              | — |        | $      | 12                       |   | $                     | 4,274   |          | $      | (129             | )      | $                                   | (4,521  | )      | $      | 24,056 |   | $ | (1,147 | ) | $ | 22,545 |   |
|                                                                                                                       |   |           |         |        |   |                          |   |                  |         |          |   |                  |   |                                |         |   |   |  |   |   |  |   |   |  |   |
| Net                income                                                                                                  |   |           | — |        |   | —                  |   |                  | — |          |   | —          |   |                                | — |   |   | 883 |   |   | — |   |   | 883 |   |
| Other                comprehensive income                                                                                  |   |           | — |        |   | —                  |   |                  | — |          |   | —          |   |                                | — |   |   | — |   |   | 725 |   |   | 725 |   |
|                                                                                                                       |   |           |         |        |   |                          |   |                  |         |          |   |                  |   |                                |         |   |   |  |   |   |  |   |   |  |   |
| Total                comprehensive income                                                                                  |   |           |         |        |   |                          |   |                  |         |          |   |                  |   |                                |         |   |   |  |   |   |  |   |   | 1,608 |   |
|                                                                                                                       |   |           |         |        |   |                          |   |                  |         |          |   |                  |   |                                |         |   |   |  |   |   |  |   |   |  |   |
| Dividends                paid ($.44 per share)                                                                             |   |           | — |        |   | —                  |   |                  | — |          |   | —          |   |                                | — |   |   | (193 | ) |   | — |   |   | (193 | ) |
|                                                                                                                       |   |           |         |        |   |                          |   |                  |         |          |   |                  |   |                                |         |   |   |  |   |   |  |   |   |  |   |
| Treasury                stock purchased (3,100 shares @$31.90;                1,065 shares @ $32.00; 1,000 shares @ $32.60 |   |           | — |        |   | —                  |   |                  | — |          |   | —          |   |                                | (166    | )      |   | — |   |   | — |   |   | (166 | ) |
|                                                                                                                       |   |           |         |        |   |                          |   |                  |         |          |   |                  |   |                                |         |   |   |  |   |   |  |   |   |  |   |
| ESOP                shares allocated orcommitted                to be released for allocation (2,300 shares)               |   |           | — |        |   | —                  |   |                  | 56      |          |   | 19               |   |                                | — |   |   | — |   |   | — |   |   | 75 |   |
|                                                                                                                       |   |           |         |        |   |                          |   |                  |         |          |   |                  |   |                                |         |   |   |  |   |   |  |   |   |  |   |
| Balance,                December                31, 2006                                                                   |   | $              | — |        | $      | 12                       |   | $                     | 4,330   |          | $      | (110             | )      | $                                   | (4,687  | )      | $      | 24,746 |   | $ | (422 | ) | $ | 23,869 |   |

----

|                                                                                                                              |   | Six                Months EndedDecember                31, |    |
|-----------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------|---------|
|                                                                                                                              |   | 2006                                                       |    | 2005 |   |
|                                                                                                                              |   |  (Unaudited)                                          |    |
| CASH                FLOWS FROM OPERATING ACTIVITIES:                                                                              |   |                                                       |    |   |   |
| Net                income                                                                                                         |   | $                                                          | 883     |   | $ | 944 |   |
| Adjustments                to reconcile net income to net cash from                operating activities:                          |   |                                                       |    |   |   |  |   |
| Provision                for mortgage servicing rights valuation losses                                                           |   |                                                       | — |   |   | (46 | ) |
| Depreciation                                                                                                                      |   |                                                       | 249     |   |   | 256 |   |
| Net                amortization of marketable securities premium and                discounts                                     |   |                                                       | 318     |   |   | 546 |   |
| Amortization                of capitalized mortgage servicing rights                                                              |   |                                                       | 149     |   |   | 198 |   |
| Gain                on sale of loans                                                                                              |   |                                                       | (309    | ) |   | (301 | ) |
| Net                realized (gain) loss on sale of available-for-sale                securities                                   |   |                                                       | (1      | ) |   | (1 | ) |
| FHLB                & other dividends reinvested                                                                              |   |                                                       | — |   |   | — |   |
| Increase                in cash surrender value of life insurance                                                                 |   |                                                       | (91     | ) |   | (92 | ) |
| Loss                on sale of real estate owned                                                                                  |   |                                                       | — |   |   | 6 |   |
| Change                in assets and liabilities:                                                                                  |   |                                                       |    |   |   |  |   |
| (Increase)                decrease in assets:                                                                                     |   |                                                       |    |   |   |  |   |
| Accrued                interest and dividends receivable                                                                          |   |                                                       | (68     | ) |   | (41 | ) |
| Loans                held-for-sale                                                                                                |   |                                                       | (825    | ) |   | 1,622 |   |
| Other                assets                                                                                                       |   |                                                       | 432     |   |   | 31 |   |
| Increase                (decrease) in liabilities:                                                                                |   |                                                       |    |   |   |  |   |
| Accrued                expenses and other liabilities                                                                             |   |                                                       | (254    | ) |   | 199 |   |
| Net                cash provided by operating activities                                                                          |   |                                                       | 483     |   |   | 3,321 |   |
|                                                                                                                              |   |                                                       |         |   |   |  |   |
| CASH                FLOWS FROM INVESTING ACTIVITIES:                                                                              |   |                                                       |         |   |   |  |   |
| Purchase                of securities:                                                                                            |   |                                                       |         |   |   |  |   |
| Investment                securities held-to-maturity                                                                             |   |                                                       | — |   |   | — |   |
| Investment                securities available-for-sale                                                                           |   |                                                       | (13,720 | ) |   | (4,269 | ) |
| Proceeds                from maturities, calls and principal payments:                                                            |   |                                                       |    |   |   |  |   |
| Investment                securities held-to-maturity                                                                             |   |                                                       | 56      |   |   | 90 |   |
| Investment                securities available-for-sale                                                                           |   |                                                       | 8,977   |   |   | 9,836 |   |
| FHLB                stock redeemed                                                                                                |   |                                                       | — |   |   | — |   |
| Proceeds                from sales of investment securities available-for-sale                                                    |   |                                                       | 3,316   |   |   | 505 |   |
| Net                increase in loans receivable, excludes transfers to                real estate acquired in settlement of loans |   |                                                       | (6,610  | ) |   | (15,426 | ) |
| Purchase                of stock in non-consolidated subsidiaries                                                                 |   |                                                       | — |   |   | (155 | ) |

----

|                                                                                                    |   |  Six                Months EndedDecember                31, |    |
|---------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------|---------|
|                                                                                                    |   | 2006                                                             |    | 2005 |   |
|                                                                                                    |   |  (Unaudited)                                                |    |
| CASH                FLOWS FROM INVESTING ACTIVITIES (CONTINUED):                                        |   |                                                             |    |   |   |
| Purchase                of property and equipment                                                       |   |                                                             | (225    | ) |   | (138 | ) |
| Purchase                of bank owned life insurance                                                    |   |                                                             | (342    | ) |   | — |   |
| Proceeds                from the sale of real estate acquired in the settlement of                loans |   |                                                             | — |   |   | 69 |   |
| Net                cash used in investing activities                                                    |   |                                                             | (8,548  | ) |   | (9,488 | ) |
|                                                                                                    |   |                                                             |    |   |   |  |   |
| CASH                FLOWS FROM FINANCING ACTIVITIES:                                                    |   |                                                             |    |   |   |  |   |
| Net                increase (decrease) in checking and savings accounts                                 |   |                                                             | 993     |   |   | (394 | ) |
| Net                (decrease) increase in federal funds                                                 |   |                                                             | (2,175  | ) |   | 1,400 |   |
| Payments                on FHLB advances                                                                |   |                                                             | (9,334  | ) |   | (584 | ) |
| FHLB                advances                                                                            |   |                                                             | 21,000  |   |   | 1,000 |   |
| Issue                of subordinated debentures                                                         |   |                                                             | — |   |   | 5,155 |   |
| Sale                (purchase) of treasury stock                                                        |   |                                                             | (166    | ) |   | (285 | ) |
| Dividends                paid                                                                           |   |                                                             | (194    | ) |   | (180 | ) |
| Net                cash provided by financing activities                                                |   |                                                             | 10,124  |   |   | 6,112 |   |
|                                                                                                    |   |                                                             |    |   |   |  |   |
| Net                increase (decrease) in cash and cash equivalents                                     |   |                                                             | 2,059   |   |   | (55 | ) |
|                                                                                                    |   |                                                             |    |   |   |  |   |
| CASH                AND CASH EQUIVALENTS, beginning of period                                           |   |                                                             | 2,871   |   |   | 4,966 |   |
|                                                                                                    |   |                                                             |    |   |   |  |   |
| CASH                AND CASH EQUIVALENTS, end of period                                                 |   | $                                                                | 4,930   |   | $ | 4,911 |   |
|                                                                                                    |   |                                                             |         |   |   |  |   |
| SUPPLEMENTAL                CASH FLOW INFORMATION:                                                      |   |                                                             |         |   |   |  |   |
| Cash                paid during the period for interest                                                 |   | $                                                                | 2,926   |   | $ | 1,724 |   |
|                                                                                                    |   |                                                             |    |   |   |  |   |
| Cash                paid during the period for income taxes                                             |   | $                                                                | 322     |   | $ | 387 |   |
|                                                                                                    |   |                                                             |    |   |   |  |   |
| NON-CASH                INVESTING ACTIVITIES:                                                           |   |                                                             |    |   |   |  |   |
| (Increase)                decrease in market value of securities available-for-sale                     |   | $                                                                | (957    | ) | $ | 642 |   |
|                                                                                                    |   |                                                             |    |   |   |  |   |
| Mortgage                servicing rights capitalized                                                    |   | $                                                                | 108     |   | $ | 109 |   |

----

**NOTE      1: BASIS OF PRESENTATION**

**NOTE      2: INVESTMENT SECURITIES**

|                                 |   |   December              31, 2006 (Unaudited)     |   | June                30, 2006 (Audited)     |   |
|--------------------------------------|--------|--------------------------------------------------------------------------------|--------|----------------------------------------------------------------|--------|
|                                 |   | AMORTIZEDCOST                                                                  |   | GROSSUNREALIZEDGAINS/(LOSSES)                                  |   | FAIRVALUE |   | AMORTIZEDCOST |   | GROSSUNREALIZEDGAINS/(LOSSES) |   | FAIRVALUE |   |
| **Available-for-sale:**              |   |                                                                           |   |                                                           |   |   |   |   |   |   |   |   |   |
| U.S.                government and   |   |                                                                           |        |                                                           |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| agency                obligations    |   | $                                                                              | 4,145  |                                                           | $      | (54 | ) | $ | 4,091 |   | $ | 7,448 |   | $ | (152 | ) | $ | 7,296 |   |
| Municipal                obligations |   |                                                                           | 18,237 |                                                           |   | 89 |   |   | 18,326 |   |   | 17,471 |   |   | (328 | ) |   | 17,143 |   |
| Corporate                obligations |   |                                                                           | 14,986 |                                                           |   | (200 | ) |   | 14,786 |   |   | 16,059 |   |   | (442 | ) |   | 15,617 |   |
| Mortgage-backed                      |   |                                                                           |        |                                                           |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| securities                           |   |                                                                           | 8,066  |                                                           |   | (106 | ) |   | 7,960 |   |   | 6,949 |   |   | (202 | ) |   | 6,747 |   |
| Collateralized                       |   |                                                                           |        |                                                           |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| mortgage                obligations  |   |                                                                           | 19,917 |                                                           |   | (239 | ) |   | 19,678 |   |   | 16,330 |   |   | (513 | ) |   | 15,817 |   |
| Corporate                preferred   |   |                                                                           |        |                                                           |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| stock                                |   |                                                                           | 1,800  |                                                           |   | (195 | ) |   | 1,605 |   |   | 1,800 |   |   | (222 | ) |   | 1,578 |   |
| Total                                |   | $                                                                              | 67,151 |                                                           | $      | (705 | ) | $ | 66,446 |   | $ | 66,057 |   | $ | (1,859 | ) | $ | 64,198 |   |
| **Held-to-maturity:**                |   |                                                                           |        |                                                           |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Municipal                obligations |   | $                                                                              | 827    |                                                           | $      | 15 |   | $ | 842 |   | $ | 828 |   | $ | 12 |   | $ | 840 |   |
| Mortgage-backed                      |   |                                                                           |        |                                                           |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| securities                           |   |                                                                           | 150    |                                                           |   | 1 |   |   | 151 |   |   | 190 |   |   | - |   |   | 190 |   |
| Total                                |   | $                                                                              | 977    |                                                           | $      | 16 |   | $ | 993 |   | $ | 1,018 |   | $ | 12 |   | $ | 1,030 |   |

----

**NOTE      3: **
**LOANS      RECEIVABLE**

|                                                       |   | December                31,2006 |    | June                30,2006 |   |
|------------------------------------------------------------|--------|---------------------------------|---------|-----------------------------|--------|
|                                                       |   | (Unaudited)                     |    | (Audited)                   |   |
| *(Dollars                in Thousands)*                    |   |                            |    |                        |   |
| First                mortgage loans:                       |   |                            |    |                        |   |
| Residential                mortgage (1-4 family)           |   | $                               | 78,665  |                        | $      | 75,913 |   |
| Commercial                real estate                      |   |                            | 20,395  |                        |   | 18,648 |   |
| Real                estate construction                    |   |                            | 6,671   |                        |   | 6,901 |   |
|                                                       |   |                            |    |                        |   |   |   |
| Other                loans:                                |   |                            |    |                        |   |   |   |
| Home                equity                                 |   |                            | 23,836  |                        |   | 20,191 |   |
| Consumer                                                   |   |                            | 10,339  |                        |   | 11,820 |   |
| Commercial                                                 |   |                            | 7,877   |                        |   | 7,861 |   |
|                                                       |   |                            |    |                        |   |   |   |
| Total                                                      |   |                            | 147,783 |                        |   | 141,334 |   |
|                                                       |   |                            |    |                        |   |   |   |
| Less:                  Allowance for loan losses |   |                            | (520    | )                           |   | (535 | ) |
|     Deferred                loan fees  |   |                            | 68      |                        |   | 59 |   |
|                                                       |   |                            |    |                        |   |   |   |
| Total                                                      |   | $                               | 147,331 |                        | $      | 140,858 |   |

|                                                                           |   | Six Months                EndedDecember                31,2006  |    | Year EndedJune                30,2006  |   |
|--------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------|---------|--------------------------------------------------|--------|
|                                                                           |   | (Unaudited)                                                          |    | (Audited)                                        |   |
| *(Dollars                in Thousands)*                                        |   |                                                                      |    |                                             |   |
| Balance,                beginning of period                                    |   | $                                                                         | 535     |                                             | $      | 573 |   |
| Reclassification                to repossessed property                reserve |   |                                                                      | — |                                             |   | (15 | ) |
| Provision                charged to operations                                 |   |                                                                      | — |                                             |   | — |   |
| Charge-offs                                                                    |   |                                                                      | (22     | )                                                |   | (48 | ) |
| Recoveries                                                                     |   |                                                                      | 7       |                                             |   | 25 |   |
| Balance,                end of period                                          |   | $                                                                         | 520     |                                             | $      | 535 |   |

----

**NOTE      4:**
**DEPOSITS**

|                                        |   | December                31,2006 |    | June                30, 2006 |   |
|---------------------------------------------|--------|---------------------------------|---------|-----------------------------------|--------|
|                                        |   | (Unaudited)                |    | (Audited)                         |   |
| *(Dollars                in Thousands)*     |   |                            |    |                              |   |
| Noninterest                checking         |   | $                               | 12,575  |                              | $      | 12,575 |   |
| Interest-bearing                checking    |   |                            | 31,149  |                              |   | 29,571 |   |
| Passbook                                    |   |                            | 22,400  |                              |   | 24,438 |   |
| Money                market                 |   |                            | 26,205  |                              |   | 29,129 |   |
| Time                certificates of deposit |   |                            | 83,006  |                              |   | 78,629 |   |
| Total                                       |   | $                               | 175,335 |                              | $      | 174,342 |   |

**NOTE      5: EARNINGS PER SHARE**

**NOTE      6: DIVIDENDS AND STOCK REPURCHASE PROGRAM**

----

**NOTE      7: **
**MORTGAGE      SERVICING RIGHTS**

|                                         |   | Six                monthsendedDecember                31,2006 |    | Twelve                monthsendedJune                30,2006 |   |
|----------------------------------------------|--------|---------------------------------------------------------------|---------|--------------------------------------------------------------|--------|
|                                         |   | (Unaudited)                                                   |    | (Audited)                                                    |   |
| *(Dollars                in Thousands)*      |   |                                                          |    |                                                         |   |
| Mortgage                Servicing Rights     |   |                                                          |    |                                                         |   |
| Beginning                balance             |   | $                                                             | 1,722   |                                                         | $      | 1,903 |   |
| Servicing                rights capitalized  |   |                                                          | 109     |                                                         |   | 174 |   |
| Servicing                rights amortized    |   |                                                          | (149    | )                                                            |   | (355 | ) |
| Ending                balance                |   |                                                          | 1,682   |                                                         |   | 1,722 |   |
|                                         |   |                                                          |    |                                                         |   |  |   |
| Valuation                Allowance           |   |                                                          |    |                                                         |   |  |   |
| Beginning                balance             |   |                                                          | — |                                                         |   | 46 |   |
| Provision                                    |   |                                                          | — |                                                         |   | (46 | ) |
| Adjustments                                  |   |                                                          | — |                                                         |   | — |   |
| Ending                balance                |   |                                                          | — |                                                         |   | — |   |
|                                         |   |                                                          |    |                                                         |   |  |   |
| Net                Mortgage Servicing Rights |   | $                                                             | 1,682   |                                                         | $      | 1,722 |   |

----

**ITEM      2: MANAGEMENT’S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF      OPERATIONS**

**Note      Regarding Forward-Looking Statements**

**Overview**

----

**Financial      Condition**

**Results      of Operations for the Three Months Ended December 31, 2006 and      2005**

*Net      Income.*

*Net      Interest Income.*

*Interest      and Dividend Income.*

----

**Results      of Operations for the Three Months Ended December 31, 2006 and 2005 -**
***continued***

*Interest      Expense.*

*Provision      for Loan Losses.*

*Noninterest      Income. *

*Noninterest      Expense.*

*Income      Tax Expense.*

**Results      of Operations for the Six Months Ended December 31, 2006 and      2005**

*Net      Income.*

*Net      Interest Income.*

----

**Results      of Operations for the Six Months Ended December 31, 2006 and 2005 -**
***continued***

*Interest      and Dividend Income.*

*Interest      Expense.*

*Provision      for Loan Losses.*

*Noninterest      Income.*

*Noninterest      Expense.*

*Income      Tax Expense.*

----

**Liquidity,      Interest Rate Sensitivity and Capital Resources**

|                               |   | (Unaudited)At                December 31, 2006 |   |
|------------------------------------|--------|------------------------------------------------|--------|
|                               |   | DollarAmount                                   |   | For                CapitalAdequacyPurposes%                of Assets |   |
| Tangible                capital:   |   |                                           |   |   |   |
| Capital                level       |   | $                                              | 25,227 |   |   | 10.73 | % |
| Requirement                        |   |                                           | 3,528  |   |   | 1.50 |   |
| Excess                             |   | $                                              | 21,699 |   |   | 9.23 | % |
| Core                capital:       |   |                                           |   |   |   |   |   |
| Capital                level       |   | $                                              | 25,227 |   |   | 10.73 | % |
| Requirement                        |   |                                           | 7,055  |   |   | 3.00 |   |
| Excess                             |   | $                                              | 18,172 |   |   | 7.73 | % |
| Risk-based                capital: |   |                                           |   |   |   |   |   |
| Capital                level       |   | $                                              | 25,711 |   |   | 15.34 | % |
| Requirement                        |   |                                           | 13,413 |   |   | 8.00 |   |
| Excess                             |   | $                                              | 12,298 |   |   | 7.34 | % |

----

**Impact      of Inflation and Changing Prices**

**Application      of Critical Accounting Policies**

----

**ITEM      3: CONTROLS AND PROCEDURES**

----

**Part      II - OTHER INFORMATION**

|       c.)  | Issuer                Purchases of Equity Securities. |
|-----------------------------------------------|-------------------------------------------------------|

| Period                                                        |   | TotalNumber                ofSharesPurchased* |   | AveragePrice                PaidPer                Share |   | Total                Numberof                SharesPurchasedas                Part ofPubliclyAnnounced                Plansor                Programs |   | MaximumNumber                ofShares                thatMay                Yet BePurchasedUnder                the Plansor                Programs |   |
|---------------------------------------------------------------|--------|-----------------------------------------------|--------|----------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| October                200610-1-06                to10-31-06  |   |                                          | None   |                                                     |   | N/A                                                                                                                                                   |   |                                                                                                                                                | N/A    |   |   | N/A |   |
|                                                          |   |                                          |   |                                                     |   |                                                                                                                                                  |   |                                                                                                                                                |   |   |   |   |   |
| November                200611-1-06                to11-30-06 |   |                                          | 1,000  |                                                     | $      | 32.60                                                                                                                                                 |   |                                                                                                                                                | 1,000  |   |   | 6,735 |   |
|                                                          |   |                                          |   |                                                     |   |                                                                                                                                                  |   |                                                                                                                                                |   |   |   |   |   |
| December                200612-1-06                to12-31-6  |   |                                          | None   |                                                     |   | N/A                                                                                                                                                   |   |                                                                                                                                                | N/A    |   |   | N/A |   |
|                                                          |   |                                          |   |                                                     |   |                                                                                                                                                  |   |                                                                                                                                                |   |   |   |   |   |
| Total                                                         |   |                                          | 1,000  |                                                     | $      | 32.60                                                                                                                                                 |   |                                                                                                                                                | 1,000  |   |   | N/A |   |

| a.)   | Election                of directors for three-year terms expiring in                2009: |
|-----------------|--------------------------------------------------------------------------------------------|

|                                  |   |  For: |      |  Against: |   |
|---------------------------------------|--------|------------|-----------|----------------|--------|
|  James                A. Maierle |   |       | 1,028,303 |           |   | 3,202 |   |
| Thomas                J. McCarvel     |   |       | 1,027,303 |           |   | 4,202 |   |

| b.)   | Ratification                  of appointment of Davis, Kinard & Co., P.C. as                  auditors |
|-----------------|------------------------------------------------------------------------------------------------------------|

|   |  For: |   | Against: |   | Abstain: |
|--------|------------|--------|----------|--------|----------|
|   | 1,029,028  |   | 60       |   | 2,417    |

----

**Part      II - OTHER INFORMATION (continued)**

----

|                                       |                                |                                    |
|--------------------------------------------|-------------------------------------|-----------------------------------------|
|                                       | **EAGLE                BANCORP**    |
|                                  |                           |                               |
| Date: February                8, 2007 | By:                       | /s/ Larry                A. Dreyer |
|                                       | Larry                A. Dreyer      |
|                                       | Title:                President/CEO |

|                                         |                                                 |                                       |
|----------------------------------------------|------------------------------------------------------|--------------------------------------------|
| Date: February                  8, 2007 | By:                                        | /s/ Peter                  J. Johnson |
|                                         | Peter                  J. Johnson                    |
|                                         | Title:                  Executive Vice President/CFO |

----