SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10-QSB

[ X ]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
       EXCHANGE ACT OF 1934

                For the quarterly period ended September 30, 1998
                                       OR

[   ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
       EXCHANGE ACT OF 1934

               For the transition period from ________ to ________

                         Commission File Number 0-21170

                                 FFW CORPORATION
        (Exact name of small business issuer as specified in its charter)

           Delaware                                    35-1875502
(State or other jurisdiction of                     (I.R.S. Employer
incorporation or organization)                  Identification or Number)

                    1205 North Cass Street, Wabash, IN 46992
                    (Address of principal executive offices)

                                 (219) 563-3185
                           (Issuer's telephone number)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed  by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.
                                 Yes [ X ]    No [   ]

           Transitional Small Business Disclosure Format (check one):

                                 Yes [   ]    No [ X ]

State the number of Shares outstanding of each of the issuer's classes of common
equity, as of the latest date:

As of November 13, 1998, there were 1,442,032 shares of the Registrant's  common
stock issued and outstanding.
<PAGE>
                                 FFW CORPORATION

                                      INDEX


PART I.     FINANCIAL INFORMATION (unaudited)                                   

Item 1.       Consolidated Condensed Financial Statements

                  Consolidated Condensed Balance Sheets September 30, 1998      
                  and June 30, 1998

                  Consolidated  Condensed  Statements  of Income for the three
                  months ended September 30, 1998 and 1997.                     

                  Consolidated Statements of Cash Flows for the three           
                  months ended September 30, 1998 and 1997.

                  Notes to Consolidated Condensed Financial Statements          


Item 2.       Management's Discussion and Analysis of Financial                 
              Condition and Results of Operations



PART II.    OTHER INFORMATION

            Signature Page

<PAGE>
<TABLE>
<CAPTION>
                                         PART I: FINANCIAL INFORMATION
                                                FFW CORPORATION
                                          CONSOLIDATED BALANCE SHEETS

                                                                                                    (Unaudited)
                                                                                                    September 30,        June 30,
                                                                                                        1998               1998
                                                                                                   -------------      -------------
<S>                                                                                                <C>                <C>          
ASSETS:
         Cash and due from financial institutions ............................................     $   4,414,192      $   4,023,917
         Interest-earning deposits in financial institutions - short term ....................            74,438            386,435
                                                                                                   -------------      -------------
                  Cash and cash equivalents ..................................................     $   4,488,630      $   4,410,352
         Interest-earning deposits in financial institutions
                  (cost approximates market value) ...........................................              --                 --
         Securities available for sale .......................................................        52,014,120         50,293,229
         Loans held for sale, net of unrealized gains and losses .............................              --                 --
         Loans receivable, net of allowance for loan losses of $1,064,677 in September
                  and $982,532 in June .......................................................       146,086,410        139,393,692
         Stock in Federal Home Loan Bank, at cost ............................................         3,432,200          2,757,200
         Accrued interest receivable .........................................................         1,437,360          1,428,927
         Premises and Equipment-net ..........................................................         2,215,760          2,205,458
         Investment in limited partnership ...................................................           704,991            704,990
         Other assets ........................................................................         2,450,460          2,117,415
                                                                                                   -------------      -------------
                           Total Assets ......................................................     $ 212,829,931      $ 203,311,263
                                                                                                   =============      =============


<PAGE>
<CAPTION>
                                         PART I: FINANCIAL INFORMATION
                                                FFW CORPORATION
                                          CONSOLIDATED BALANCE SHEETS
                                                   (Continued)

                                                                                                    (Unaudited)
                                                                                                    September 30,        June 30,
                                                                                                        1998               1998
                                                                                                   -------------      -------------
<S>                                                                                                <C>                <C>          
LIABILITIES AND SHAREHOLDERS' EQUITY:

Liabilities:
         Non-interest-bearing demand deposits ................................................     $   7,084,888      $   6,935,426
         Savings, Now and MMDA deposits ......................................................        52,029,212         51,485,630
         Other time deposits .................................................................        66,983,485         66,835,247
                                                                                                   -------------      -------------
                  Total Deposits .............................................................     $ 126,097,585      $ 125,256,303
         Federal Home Loan Bank advances .....................................................        63,500,000         56,500,000
         Obligation relative to limited partnership ..........................................           187,500            300,000
         Accrued Interest Payable ............................................................           790,531            204,036
         Accrued expenses and other liabilities ..............................................         2,512,754          1,922,197
                                                                                                   -------------      -------------
                  Total Liabilities ..........................................................     $ 193,088,370      $ 184,182,536

Shareholders' Equity:
         Preferred stock, $.01 par value, 500,000 shares authorized, none issued .............              --                 --
         Common stock, $.01 par value, 2,000,000 shares authorized, 1,775,096 shares
              issued and 1,448,032 outstanding at September, 30 1998; 1,775,096 shares
              issued and1,458,032 shares outstanding at June 30, 1998 ........................            17,751             17,751
         Additional paid-in capital ..........................................................         8,847,133          8,793,133
         Retained earnings - substantially restricted ........................................        12,795,894         12,468,144
         Net unrealized depreciation on securities available for sale, net of tax liability
                  of $743,797 on September 30, 1998 and of $489,649 on
                  June 30, 1998 ..............................................................         1,070,269            685,432

         Unearned Employee stock Ownership Plan shares .......................................          (151,747)          (151,748)
         Treasury Stock at cost, 327,064 on September 30, 1998 and 317,064 at
                  June 30, 1998 ..............................................................        (2,837,739)        (2,683,985)
                                                                                                   -------------      -------------

                         Total Shareholders' equity ..........................................        19,741,561         19,128,727

                           Total Liabilities and Shareholders' Equity ........................     $ 212,829,931      $ 203,311,263
                                                                                                   =============      =============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                          PART I: FINANCIAL INFORMATION
                                 FFW CORPORATION
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)


                                                                    Three Months Ended
                                                                       September 30
                                                                   1998           1997
                                                                ----------     ----------
<S>                                                             <C>            <C>       
Interest Income:

         Loans Receivable
                  Mortgage loans ..........................     $1,586,136     $1,581,434
                  Consumer and other loans ................      1,469,869        996,536
         Securities
                  Taxable .................................        719,162        761,959
                  Nontaxable ..............................        124,597        103,409
         Other Interest-earning assets ....................         67,313         62,199
                                                                ----------     ----------
                  Total Interest Income ...................     $3,967,077     $3,505,537

Interest Expense :

         Deposits .........................................      1,490,653      1,386,462
         Other ............................................        915,323        675,266
                                                                ----------     ----------
                  Total Interest Expense ..................     $2,405,976     $2,061,728

Net Interest Income .......................................      1,561,101      1,443,810

         Provision for Loan Losses ........................        120,000        200,000
                                                                ----------     ----------

Net interest income after provision for loan losses .......      1,441,101      1,243,810

Non-interest income :

         Net gain on sale of interest-earning assets ......         30,165         16,240
         Net unrealized gain or loss on loans held for sale           --             --
         Other ............................................        279,974        217,550
                                                                ----------     ----------
                  Total Non-Interest Income ...............     $  310,139     $  233,790
<PAGE>
<CAPTION>
                          PART I: FINANCIAL INFORMATION
                                 FFW CORPORATION
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)
                                   (Continued)


                                                                    Three Months Ended
                                                                       September 30
                                                                   1998           1997
                                                                ----------     ----------
<S>                                                             <C>            <C>       
Non-Interest Expense :

         Compensation and Benefits ........................        512,532        442,537
         Occupancy and equipment ..........................         93,950         80,614
         SAIF deposit insurance premiums ..................         31,092         27,164
         Other ............................................        364,421        386,971
                                                                ----------     ----------
                  Total Non-Interest Expense ..............     $1,001,995     $  910,112
                                                                ----------     ----------

Income before income taxes ................................        749,245        567,487

         Income Tax Expense ...............................        268,562         97,510
                                                                ----------     ----------

Net Income ................................................     $  480,683     $  469,978
                                                                ==========     ==========


Other Comprehensive Income, Net of Tax:
               Unrealized Gain (Loss) on Securities .......        384,837         78,766

Comprehensive Income ......................................     $  865,520     $  548,744
                                                                ==========     ==========

Earnings per common and common equivalent shares :

         Basic ............................................     $      .34     $      .34
         Diluted ..........................................     $      .33     $      .33
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                          PART I: FINANCIAL INFORMATION
                                 FFW CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                                                                  Three Months Ended
                                                                                      September 30
                                                                                1998              1997
                                                                            ------------      ------------
<S>                                                                         <C>               <C>         
Cash flows from operating activities :
         Net Income ...................................................     $    480,683      $    469,978
         Adjustments to reconcile net income to net cash from operating
              activities :
             Depreciation and amortization, net of accretion ..........          (10,704)          (16,167)
             Provision for loan losses ................................          120,000           200,000
             Net (gains) losses on sale of :
                  Securities available for sale .......................           11,882              --
                      Loans held for sale .............................          (42,047)          (21,909)
                  Foreclosed estate owned and repossessed assets ......           (6,060)           (1,398)
             Origination of loans held for sale .......................       (3,612,131)       (1,940,280)
             Proceeds from sale of loans held for sale ................        3,664,510         1,962,189
             ESOP expenses ............................................           78,426            13,000
             Amortization of MRP contribution .........................             --                --
             Net change in accrued interest receivable ................           (8,433)         (190,319)
             Amortization of goodwill and core deposit intangibles ....           39,087            41,118
             Net change in other assets ...............................         (329,456)         (213,369)
             Net change in accrued interest payable, accrued
                  expenses and other liabilities ......................          726,872           811,572
                                                                            ------------      ------------
                           Total adjustments ..........................     $    631,946      $    644,435
                                                                            ------------      ------------
                  Net cash from operating activities ..................     $  1,112,629      $  1,114,413

Cash flows from investing activities :
             Net change in interest-bearing deposits in other
                  Financial institutions ..............................             --                --
             Proceeds from :
                  sales/calls of securities available for sale ........          801,136         5,000,000
                  sales/calls of securities held-to-maturity ..........             --                --
                  Maturities of securities available for sale .........        4,000,000            45,000
                  Maturities of securities held-to-maturity ...........             --                --
             Purchase of :
                        Securities available for sale .................       (6,000,000)      (15,056,122)
                  Federal Home Loan Bank Stock ........................         (675,000)             --
             Principal collected on mortgage-backed securities ........          169,657           154,081
             Net change in loans receivable ...........................       (6,812,718)       (5,805,198)
             Net purchases premises and equipment .....................          (57,705)           (8,396)
             Investment in limited partnership ........................         (112,500)         (187,500)
             Proceeds from sales of other real estate and
                  Repossessed assets ..................................          118,384           118,950
                                                                            ------------      ------------ 
                  Net cash from investing activities ..................     $ (8,568,746)     $(15,739,185)
<PAGE>
<CAPTION>
                          PART I: FINANCIAL INFORMATION
                                 FFW CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                   (Continued)
                                                                                  Three Months Ended
                                                                                      September 30
                                                                                1998              1997
                                                                            ------------      ------------
<S>                                                                         <C>               <C>         
Cash flows from financing activities :

            Net increase in deposits ..................................          841,282        (1,178,415)
            Proceeds from short-term borrowings .......................       12,000,000        10,500,000
            Payment on short-term borrowings ..........................       (5,000,000)       (8,500,000)
            Purchase of Treasury Stock ................................         (153,753)             --
            Proceeds from exercising of stock options .................             --              36,130
            Cash dividends paid .......................................         (153,134)         (128,672)
                                                                            ------------      ------------
                   Net cash from financing activities .................     $  7,534,395      $    729,043

Net increase (decrease) in cash and cash equivalents ..................     $     78,278      $(13,895,729)
Cash and cash equivalents at beginning of period ......................     $  4,410,352      $ 17,120,614

Cash and cash equivalents at end of period ............................     $  4,488,630      $  3,224,885
                                                                            ============      ============


</TABLE>
<PAGE>
                                 FFW CORPORATION
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (UNAUDITED)


(1)  Basis of Presentation

         The accompanying  unaudited Consolidated Condensed Financial Statements
have been prepared in accordance with generally accepted  accounting  principles
for interim  financial  information  and with the  instructions to Form 10-Q and
Regulation  S-X.  Accordingly,  they  do not  include  all the  information  and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements.

         In the opinion of  management,  the  Consolidated  Condensed  Financial
Statements  contain  all  adjustments   (consisting  only  of  normal  recurring
adjustments)  necessary  to  represent  fairly the  financial  condition  of FFW
Corporation  as of September 30, 1998 and June 30, 1998,  and the results of its
operations,  for the three months ended  September 30, 1998 and 1997.  Financial
Statement  reclassifications  have been made for the prior  period to conform to
classifications used as of and for the period ended September 30, 1998.

         Operating results for the three months ended September 30, 1998 are not
necessarily  indicative  of the results that may be expected for the fiscal year
ended June 30, 1999.

(2)  Earnings Per Share of Common Stock

         Basic and diluted earning per share are computed under a new accounting
standard  effective in the quarter  ended  December 31, 1997.  All prior amounts
have been restated to be  comparable.  Basic  earnings per share is based on net
income (less  preferred  dividends)  divided by the weighted  average  number of
shares  outstanding  during the  period.  Diluted  earnings  per share shows the
dilutive  effect of additional  common shares  issuable under stock options (and
convertible  securities).   Diluted  net  income  per  common  share  was  $0.33
respectively, for the three-month period ended September 30, 1998, from $0.33 in
1997.  Earnings  per share have been  adjusted  to reflect a 100%  common  stock
dividend declared December 15, 1998 and paid December 31, 1998.
<PAGE>
(3)  Regulatory Capital Requirements

         Pursuant to the Financial Institution Reform, Recovery, and Enforcement
Act of l989 ("FIRREA"),  savings  institutions  must meet three separate minimum
capital-to-asset  requirements.  The following table summarizes, as of September
30,  1998,  the capital  requirements  for the Bank under  FIRREA and its actual
capital ratios.  As of September 30, 1998, the Bank  substantially  exceeded all
current regulatory capital standards.
<TABLE>
<CAPTION>
                                         Regulatory                            Actual
                                         ----------                            ------
                                    Capital Requirement                  Capital (Bank Only)
                                    -------------------                  -------------------
                                   Amount        Percent               Amount         Percent
                                   ------        -------               ------         -------
                                                     (Dollars in Thousands)
<S>                               <C>              <C>                <C>              <C>   
Risk-Based ................       $10,037          8.00%              $15,381          12.26%
Core Capital ..............         6,235          3.00%               14,341           6.90%
Tangible Capital ..........         3,118          1.50%               14,341           6.90%
</TABLE>


(4)  Common Stock Cash Dividends

         On August 25, 1998, the Board of Directors of FFW Corporation, declared
a quarterly  cash dividend of $.105 per share.  The dividend was paid  September
30, 1998 to  shareholders  of record on September  15, 1998.  The payment of the
cash dividend reduced shareholders' equity by $153,134.
<PAGE>
                                     PART II

                                 FFW CORPORATION

                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations


General

         The accompanying  Consolidated Financial Statement includes the account
of FFW  Corporation  (the  "Company") and its wholly owned  subsidiaries,  First
Federal  Savings Bank of  Wabash(the  "Bank") and FirstFed  Financial of Wabash,
Inc. All significant  inter-company  transactions and balances are eliminated in
consolidation.  The Company's  results of operations are primarily  dependent on
the Bank's net interest margin,  which is the difference between interest income
on interest-earning assets and interest expense on interest-bearing liabilities.
The  Bank's  net  income  is also  affected  by the  level  of its  non-interest
expenses,  such as employee compensation and benefits,  occupancy expenses,  and
other expenses.

Forward - Looking Statements

         When used in this Form 10 - Q and in future filings by the Company with
Securities  and Exchange  Commission,  in the  Company's  press release or other
public  or  shareholder  communications,  and in oral  statements  made with the
approval of an authorized  executive  officer,  the words or phrase "will likely
result",  "are expected to",  "will  continue",  "is  anticipated",  "estimate",
"project" or similar  expressions  are  intended to identify  "forward - looking
statements" within the meaning of the Private  Securities  Litigation Reform Act
of 1997.  Such statements are subject to certain risks and  uncertainties,  that
could cause actual results to differ  materially  from  historical  earnings and
those presently anticipated or projected.  The Company wishes to caution readers
not to place undue  reliance  on any such  forward - looking  statements,  which
speak only as of the date made.  The Company  wishes to advise  readers that the
factors listed below could affect the Company's financial  performance and could
cause the Company's actual results for future periods to differ  materially from
any  opinions or  statements  expressed  with  respect to future  periods in any
current statements.

         The  Company  does  not  undertake  -  and  specifically  declines  any
obligation - to publicly  release the result of any revisions  which may be made
to any forward - looking statements to reflect events or circumstances after the
date  of  such  statements  or to  reflect  the  occurrence  of  anticipated  or
unanticipated events.

Financial Condition

         The Company's total assets increased $9.5 million, or 4.7%, from $203.3
million at June 30, 1998 to $212.8 million at September 30, 1998.  This increase
was due  primarily to funds  generated  by an increase in advances  from FHLB of
$7.0  million.  Net loans  receivables  increased  $6.7  million and  securities
available-for-sale  increased $1.7 million.  Loan demand and liquidity needs may
result in  additional  borrowings  if deposits and loan growth remain at current
levels.
<PAGE>
         Total securities  available-for-sale  increased $1.7 million from $50.3
million at June 30, 1998 to $52.0 million at September  30, 1998.  This increase
was primarily the result of purchases of callable bonds. The  available-for-sale
portfolio  consists  primarily of  municipal  securities,  government  agencies,
mortgage-backed  securities  and  to a  lesser  extent  mutual  funds  and  FNMA
preferred stock.

         Net loans  receivable  increased  $6.7  million,  or 4.8%  from  $139.4
million at June 30, 1998 to $146.1  million at September 30, 1998.  The increase
in the loan portfolio for the quarter resulted,  primarily,  from an increase in
non-mortgage  loans  of  $6.0  million  due  to an  increase  in  origination's.
Management,  consistent with its  asset/liability  objectives,  will continue to
sell  all of its  newly  originated  fixed-rate  mortgage  loans  with  terms to
maturity greater than 15 years.

         Total deposits  increased  $841,000 or 0.8% from $125.3 million at June
30,  1998 to $126.1  million  at  September  30,  1998.  For the  quarter  ended
September 30, 1998,  Savings,  Now and MMDA accounts increased $544,000 or 1.1%.
Management  believes  that  deposit  growth  may  become  more  costly  with the
increased use of specials with higher interest rates and the competitive  nature
of the markets we serve.

         Total borrowed funds  increased $7.0 million from $56.5 million at June
30, 1998 to $63.5 million at September 30, 1998.  The increase  consisted of new
short term advances from the Federal Home Loan Bank of Indianapolis.

         Total  shareholders'  equity  increased  $613,000 from $19.1 million at
June 30, 1998 to $19.7 million at September 30, 1998. The increase resulted from
net income of $481,000, and an increase in the market value of investments,  net
of tax of $385,000  which was  partially  reduced by $153,134 for the payment of
dividends, and $ 93,000 for the unearned employee stock ownership plans.

Results of Operations - Comparison of the Quarters Ended  September 30, 1998 and
September 30, 1997

         General.  Net income  increased  by $11,000 for the three  months ended
September 30, 1998 respectively, as compared to the three months ended September
30,  1997.  The  increase  for the three  months  ended  September  30, 1998 was
primarily  the result of  increases  in net interest  income,  and  non-interest
income  offset by an increase in  non-interest  expense.  All of these items are
discussed in greater detail below.

         Net Interest Income. Net interest income increased $117,000 or 8.1% for
the three months ended September 30, 1998 over the same period in 1997. This was
primarily  the result of an increase in average  interest-earning  assets  which
exceeded  the   increase  in  average   interest-bearing   liabilities,   and  a
corresponding increase in the spread earned.

         Interest  Income.  Interest income  increased  $461,000 to $4.0 million
from  $3.5  million  for  the  quarter   ended   September  30,  1998  and  1997
respectively.  The  increases  in  interest  income for the three  months  ended
September  30,  1998 were due to  continued  growth in  interest-earning  assets
including  mortgage  loans,  commercial  and consumer loans and  investment,  as
compared  to  the  same  periods  ended  September  30,  1997.  These  increased
interest-earning  assets are the result of competitive pricing,  marketing,  and
the re-pricing of adjustable-rate loans and mortgage-backed securities.
<PAGE>
         Interest Expense.  Interest expense increased  $344,000 to $2.4 million
from  $2.1  million  for  the  quarter   ended   September  30,  1998  and  1997
respectively.  For the three months ended  September  30, 1998,  the increase in
interest  expense  was  due  to an  increase  in  borrowed  funds  and  deposits
outstanding  as  compared to the same  periods in 1997.  Interest  rates,  while
remaining  steady have  increased  the use of higher  rate  specials by everyone
trying to attract deposits.

         Provision  for Loan Losses.  The  provision  for loan losses  decreased
$80,000 to $120,000 from  $200,000 for the quarter ended  September 30, 1998 and
1997 respectively.  The loan loss provisions are based on management's quarterly
analysis of the allowance for loan losses.  The  provisions  for the three month
period reflect an increase in  non-mortgage  lending and the inherent  riskiness
and the number of these loans as compared to 1-4 family mortgage loans. With the
expansion  into  commercial  lending the company  will  continue to increase its
allowance for loan losses and make future additions to the allowance through the
provision  for loan losses as loan growth,  economic and  regulatory  conditions
dictate. Although the Company maintains its allowance for loan losses at a level
which is deemed  consistent  with the level of risk in the  portfolio,  economic
conditions,  etc.  there can be no assurance  that future losses will not exceed
estimated  amounts or that  additional  provisions  for loan  losses will not be
required in future periods.

         Non-interest  Income.  Non-interest  income  increased  by  $76,000  to
$310,000  from  $234,000  for the  quarter  ended  September  30,  1998 and 1997
respectively.  The increase was the primarily the result of increased fee income
on deposit  accounts  of $61,000  and  increase in gain on sales of loans to the
Federal Home Loan  Mortgage  Corporation  of $26,000  offset by a 12,000 loss on
available for sale securities.  Management believes that with the lower interest
rates we will see a increase  in the gain on sales of loans to  Freddie  Mac for
the remainder of the year as compared to last year.

         Non-Interest  Expense.  Non-interest  expense increased $92,000 to $1.0
million  from  $910,000  for the  quarter  ended  September  30,  1998  and 1997
respectively.  For the three months ended September 30, 1998,  compensation  and
benefits  increased  by 15.82% and  occupancy  and  equipment  increased  16.54%
compared to the same period in 1997. The increase in  compensation  and benefits
is due to added  expense  from the ESOP.  Depreciation  on building  expenses is
primarily the reason for the increase in occupancy and equipment.

         Income Tax Expense.  Income tax expense increased  $171,000 to $269,000
from $98,000 for the quarter ended  September 30, 1998 compared to quarter ended
1997. The increase was due to increased taxable income as of September 30, 1998.

         Non-Performing  Assets and Allowance for Loan Losses. The allowance for
loan  losses  is  calculated  based  upon an  evaluation  of  pertinent  factors
underlying the types and qualities of the Company's loans.  Management considers
such factors as the repayment  status of a loan,  the  estimated net  realizable
value of the underlying  collateral,  the borrower's  ability to repay the loan,
current and anticipated  economic  conditions  which might affect the borrower's
ability to repay the loan and the Company's past statistical  history concerning
charge-offs.  The Company's  allowance for loan losses as of September 30, 1998,
was $1.1 million or 0.7% of total loans.  The June 30, 1998  allowance  for loan
losses  was  $983,000,  or  0.7% of  total  loans.  Total  loans  classified  as
substandard, doubtful or loss as of September 30, 1998 were $1.1 million or 0.5%
of total  assets.  Management  has  considered  non-performing  assets and total
classified assets in establishing the allowance for loan losses.
<PAGE>
         The ratio of non-performing  assets to total assets is one indicator of
the exposure to credit  risk.  Non-performing  assets of the Company  consist of
non-accruing  loans,  accruing loans  delinquent 90 days or more, and foreclosed
assets which have been acquired as a result of  foreclosure or  deed-in-lieu  of
foreclosure.
<TABLE>
<CAPTION>
                                                          9/30/98       6/30/98
                                                          -------       -------
                                                          (Dollars in Thousands)
<S>                                                       <C>            <C>   
Non-Accruing Loans ...............................        $  918         $  713
Accruing Loans Delinquent 90 days or more ........          --             --
Troubled Debt Restructurings .....................          --             --
Foreclosed Assets ................................           177            160
                                                          -------       -------
Total Non-Performing Assets ......................        $1,095         $  873
                                                          ======         ======
Total Non-Performing Assets as a
  Percentage of Total Assets .....................           .51%           .43%
</TABLE>

         Total non-performing  assets increased $222,000 to $1,095,000,  or .51%
of total assets at September 30, 1998,  from $873,000 or .43% of total assets at
June 30, 1998.  The increase in  non-performing  assets was primarily due to the
addition of several auto loans for $126,000. Foreclosed assets increased $17,000
due to the repossession of several vehicles.

         Liquidity and Capital Resources. The Company's primary sources of funds
are  deposits,  principal  and  interest  payments on loans and  mortgage-backed
securities,  FHLB Indianapolis advances and funds provided by operations.  While
scheduled  loan  and   mortgage-backed   security  repayments  and  maturity  of
short-term  investments are a relatively  predictable  source of funds,  deposit
flows are greatly  influenced by general  interest rates,  economic  conditions,
competition  and,  most  recently,  the  restructuring  occurring  in the thrift
industry.  Current Office of Thrift Supervision  regulations require the Bank to
maintain  cash and eligible  investments  in an amount equal to at least 5.0% of
customer  accounts  and  short-term  borrowings  to assure  its  ability to meet
demands for withdrawals and repayment of short-term borrowings.

         The Company uses its capital resources  principally to meet its ongoing
commitments  to fund  maturing  certificates  of deposits and loan  commitments,
maintain is liquidity and meet  operating  expenses.  At September 30, 1998, the
Company has  commitments to originate  loans totaling $1.8 million.  The Company
considers  its  liquidity  and  capital  resources  to be  adequate  to meet its
foreseeable  short- and long-term  needs. The Company expects to be able to fund
or  refinance,  on a  timely  basis,  its  material  commitments  and  long-term
liabilities.

         Regulatory  standards  impose the  following  capital  requirements:  a
risk-based  capital standard  expressed as a percent of risk-adjusted  assets, a
leverage ratio of core capital to total adjusted assets,  and a tangible capital
ratio expressed as a percent of total adjusted assets. As of September 30, 1998,
the Bank exceeded all fully phased-in regulatory capital standards.
<PAGE>
         At September 30, 1998, the Bank's  tangible  capital was $14.3 million,
or 6.9% of adjusted total assets,  which is in excess of the 1.5% requirement by
$11.2 million. In addition,  at September 30, 1998, the Bank had core capital of
$14.3  million,  or 6.9% of  adjusted  total  assets,  which  exceeds  the  3.0%
requirement by $8.1 million. The Bank had risk-based capital of $15.4 million at
September  30,  1998 or 12.3% of  risk-adjusted  assets  which  exceeds the 8.0%
risk-based capital requirements by $6.8 million.

         As required by federal law,  the OTS has  proposed a rule  revising its
minimum core capital  requirement  to be no less  stringent than that imposed on
national banks. The OTS has proposed that only those savings  associations rated
a composite  one (the highest  rating) under the MACRO rating system for savings
associations  will be  permitted  to operate at or near the  regulatory  minimum
leverage  ratio of 3.0%.  All other  savings  associations  will be  required to
maintain  a minimum  leverage  ratio of 3.0% at least an  additional  100 to 200
basis points.  The OTS will assess each individual savings  association  through
the  supervisory  process on a  case-by-case  basis to determine the  applicable
requirement.  No  assurance  can be  given  as to the  final  form  of any  such
regulation,  the date of its effectiveness or the requirement  applicable to the
Bank.  As a result of the prompt  corrective  action  provisions  of federal law
discussed  below,  however,  a savings  association must maintain a core capital
ratio  of at least  4.0% to be  considered  adequately  capitalized  unless  its
supervisory condition is such to allow it to maintain a 3.0% ratio.

         Under the requirements of federal law all the federal banking agencies,
including the OTS, must revise their risk-based  capital  requirements to ensure
that such requirements  account for interest rate risk,  concentration of credit
risk and the risks of  non-traditional  activities,  and that they  reflect  the
actual performance of and expected loss on multi-family loans.

         The  OTS  had  adopted  a  final  rule  that  requires   every  savings
association  with more than normal  interest  rate risk to deduct from its total
capital, for purposes of determining compliance with such requirement, an amount
equal to 50% of its interest-rate  risk exposure  multiplied by the market value
of its assets. This exposure is a measure of the potential decline in the market
value of portfolio equity of a savings association,  greater than 2%, based upon
a hypothetical 200 basis point increase or decrease in interest rates (whichever
results in a greater  decline)  affecting  on-and  off-balance  sheet assets and
liabilities.  The effective  date of the new  requirement  is July 1, 1994.  Any
savings  association  with less than $300 million in assets and a total  capital
ratio in excess of 12% is exempt from this requirement unless the OTS determines
otherwise.  It is anticipated  that since the Bank has less than $300 million in
assets,  and a risk-based capital ratio in excess of 12%, it will be exempt from
this rule.

YEAR 2000

         The Year 2000 issue is the result of potential  problems  with computer
systems or any equipment  with computer chips that store the year portion of the
date as just two digits  (e.g.,  98 for  1998).  Systems  using  this  two-digit
approach may not be able to determine  whether "00"  represents the Year 2000 or
1900. The problem, if not corrected,  may make those systems fail altogether or,
even worse, allow them to generate incorrect  calculations  causing a disruption
of normal operations.
<PAGE>
         In 1997, a comprehensive project plan to address the Year 2000 issue as
it relates to the company's  operation was  developed,  approved by the Board of
Directors  and  implemented.  The  scope  of  the  plan  includes  five  phases,
Awareness, Assessment,  Renovation,  Validation (testing), and Implementation as
defined by federal banking regulatory  agencies. A project team was assigned and
consists of key members of  management.  This team was to assess our systems and
equipment  and our  vendors to  ascertain  their  readiness  and to develop  the
overall  plan to bring our  systems  into  compliance.  Additionally,  it was to
assess the readiness of our  customers and determine  what risk, if any, our key
customers pose to the bank with regards to their Year 200 readiness.  The duties
of the Vice  President of  Operations  were  realigned to serve as the Year 2000
Project Manager.

         An  assessment  of the impact of the year 2000  issue on the  Company's
computer  systems has been  completed.  The scope of the project  also  includes
other  operational  and  environmental  systems  since they may be  impacted  if
embedded  computer chips control the  functionality  of those systems.  From the
assessment,  the Company has identified and prioritized  those systems deemed to
be  mission  critical  or  those  that  have  a  significant  impact  on  normal
operations.

         The Company  relies on  third-party  vendors and service  providers for
much of its data processing  capabilities and to maintain its computer  systems.
Formal  communications  with these providers and other external  counter parties
were  initiated in 1997 to assess the Year 2000  readiness of their products and
services.  Their progress in meeting their targeted schedules is being monitored
continually for any indication that they may not be able to address the problems
in time.  Thus far,  responses  indicate that all of the  significant  providers
currently have compliant  versions available or are well into the renovation and
testing  phases with  completion  scheduled for sometime in 1998.  However,  the
Company can give no guarantee  that the systems of these  service  providers and
vendors on which the Company's systems rely will be timely renovated.

         Additionally,  the  Company  has  implemented  a  plan  to  manage  the
potential  credit  risk  posed by the impact of the Year 2000 issue on its major
borrowing  customers.   Formal  communications  have  been  initiated,  and  the
assessment  was  substantially  completed  on September  30,  1998.  Loan losses
attributed  to the Year 2000 issue are not  anticipated  to be  material  to the
Company.
<PAGE>
         The project team feels that the Company's Year 2000  readiness  project
is on schedule.  The following table provides a summary of the current status of
the five phases involved and a projected timetable for completion.

================================================================================
PROJECT PHASE            % COMPLETED            PROJECTED COMPLETION
--------------------------------------------------------------------------------
Awareness                     100%
--------------------------------------------------------------------------------
Assessment                    100%
--------------------------------------------------------------------------------
Renovation                     85%              December 31, 1998
--------------------------------------------------------------------------------
Validation                     35%              April, 1999
--------------------------------------------------------------------------------
Implementation                 25%              June, 1999
================================================================================

         The  estimated  total cost of the Year 2000  project is estimated to be
between $100,000 and $150,000.  The total amount expended on the project through
September 30, 1998,  was $45,400 of which  approximately  $30,400 was related to
the cost of  replacement  software.  The  remaining  $15,000 was related to four
training  workshops  with our data  processor  and Arthur  Anderson,  a national
consulting/CPA firm, and the creation of a test bank using 5% of our data base.

         Funds have been provided from our normal operating budget and costs are
expensed as they are incurred.

         The total cost to the Company of these Year 2000  readiness  activities
has not been, and is not anticipated to be,  material to its financial  position
or results or operations in any given year.

         No specific other projects have been deferred due to this project. Much
of the work done within this project is an  acceleration of work that would have
been done in the normal course of business.

         The costs and timetable in which the Company plans to complete the Year
2000 readiness  activities are based on management's best estimates,  which were
derived using  numerous  assumptions  of future  events  including the continued
availability  of  certain  resources,  third-party  readiness  plans  and  other
factors. The Company can make no guarantee that these estimates will be achieved
and actual results could differ from such plans.

         Based upon  current  information  related to the  progress of its major
vendors and service  providers,  management  has  determined  that the Year 2000
issue will not pose significant  operational  problems for its computer systems.
This  determination  is  based  on the  ability  of those  vendors  and  service
providers to renovate,  in a timely  manner,  the products and services on which
the Company's systems rely. However,  the Company can give no guarantee that the
systems of these suppliers will be renovated in a timely manner.

         Realizing that some disruption may occur despite its best efforts,  the
Company is in the  process of  developing  contingency  plans for each  critical
system in the event  that one or more of those  systems  fail.  While this is an
ongoing process,  the Company expects to have the plan substantially  documented
by June 30, 1999.
<PAGE>
                           Part II - Other Information

         As of  September  30,  1998,  management  is not  aware of any  current
recommendations by regulatory authorities which, if they were to be implemented,
would have or are  reasonably  likely to have a material  adverse  effect on the
Company's liquidity, capital resources or operations.

Item 1  -  Legal Proceedings
           -----------------
         Not Applicable.

Item 2  -  Changes in Securities
           ---------------------
         Not Applicable.

Item 3  -  Defaults upon Senior Securities
           -------------------------------
         Not Applicable.

Item 4  -  Submission of Matters to a vote of Security Holders
           ---------------------------------------------------

         The Annual Meeting of  Shareholders  (the "Meeting") of FFW Corporation
was held on October 27,  1998.  The  matters  approved  by  shareholders  at the
Meeting and the number of votes cast for,  against or  withheld  (as well as the
number of abstentions and broker non-votes) as to each matter are set below:
<TABLE>
<CAPTION>
                  PROPOSAL                                                  NUMBER OF VOTES
                  --------                                             -------------------------
                                                                       FOR              WITHHELD
                                                                       ---              --------
<S>                                                                <C>                    <C>   
Election of the following Directors for a three-year term
         Nicholas M. George ...................................    1,136,777              21,726
         Joseph W McSpadden ...................................    1,136,667              21,836

<CAPTION>
                                                                       FOR              AGAINST           ABSTAIN
                                                                       ---              -------           -------
<S>                                                                <C>                    <C>               <C>  
Ratification of Crowe Chizek as auditors for the fiscal
year ending June 30, 1999 .....................................    1,153,423              1,400             3,680

<CAPTION>
                                                                       FOR              AGAINST           ABSTAIN
                                                                       ---              -------           -------
<S>                                                                <C>                    <C>               <C>  
Approval of the 1998 Omnibus Incentive Plan ...................      683,861            179,272           295,410

</TABLE>


Item 5  -  Other Information

         Not Applicable

Item 6  -  Exhibits and Reports on Form 8-K

         Not Applicable
<PAGE>
                                   SIGNATURES



Pursuant  to the  requirement  of the  Securities  Exchange  Act  of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                                                    FFW CORPORATION
                                                    Registrant




Date:   November 13, 1998                      /S/  Nicholas M. George
        -----------------                           ------------------
                                                    Nicholas M. George
                                                    President and Chief 
                                                    Executive Officer




Date:   November 13, 1998                     /S/  Roger K. Cromer  
        -----------------                          -----------------
                                                   Roger K. Cromer
                                                   Treasurer and Chief Financial
                                                   Accounting Officer