SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

                                   (Mark One)

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2005 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: 000-25219

                                 LINCOLN BANCORP
               (Exact name of registrant specified in its charter)

              Indiana                                         35-2055553
(State or other jurisdiction of                            (I.R.S. Employer
 incorporation or organization)                          Identification Number)

                              1121 East Main Street
                         Plainfield, Indiana 46168-0510
          (Address of principal executive offices, including Zip Code)

                                 (317) 839-6539
              (Registrant's telephone number, including area code)


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  report),  and  (2)  has  been  subject  to such  filing
requirements for the past 90 days. Yes [X]   No [ ]

Indicate  by check mark  whether  the  Registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act). Yes [ ]    No [X]

The  number of shares of the  Registrant's  common  stock,  without  par  value,
outstanding as of March 31, 2005 was 5,399,653.


<PAGE>



                         LINCOLN BANCORP AND SUBSIDIARY
                                    FORM 10-Q

                                      INDEX

                                                                        Page No.
                                                                        --------

FORWARD LOOKING STATEMENT                                                   3

PART I.  FINANCIAL INFORMATION                                              4

Item 1.  Financial Statements                                               4

           Consolidated Condensed Balance Sheets                            4

           Consolidated Condensed Statements of Income                      5

           Consolidated Condensed Statements of Comprehensive Income        6

           Consolidated Condensed Statement of Shareholders' Equity         7

           Consolidated Condensed Statements of Cash Flows                  8

           Notes to Unaudited Consolidated Condensed Financial Statements   9

Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations                                         11

Item 3.  Quantitative and Qualitative Disclosures about Market Risk        15

Item 4.  Controls and Procedures                                           15

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings                                                 16
Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds       16
Item 3.  Defaults Upon Senior Securities                                   16
Item 4.  Submission of Matters to a Vote of Security Holders               16
Item 5.  Other Information                                                 17
Item 6.  Exhibits                                                          17

SIGNATURES                                                                 18

EXHIBIT INDEX                                                              19



                                       2
<PAGE>


                            FORWARD LOOKING STATEMENT

This  Quarterly  Report on Form 10-Q ("Form  10-Q")  contains  statements  which
constitute  forward  looking  statements  within  the  meaning  of  the  Private
Securities Litigation Reform Act of 1995. These statements appear in a number of
places in this Form 10-Q and include  statements  regarding the intent,  belief,
outlook, estimate or expectations of the Company (as defined in the notes to the
consolidated  condensed  financial  statements),  its  directors or its officers
primarily with respect to future events and the future financial  performance of
the  Company.  Readers  of this Form 10-Q are  cautioned  that any such  forward
looking  statements  are not  guarantees  of future  events or  performance  and
involve risks and  uncertainties,  and that actual results may differ materially
from those in the forward looking statements as a result of various factors. The
accompanying  information  contained  in this  Form  10-Q  identifies  important
factors that could cause such  differences.  These  factors  include  changes in
interest   rates;   loss  of  deposits  and  loan  demand  to  other   financial
institutions;  substantial changes in financial markets;  changes in real estate
values and the real estate market; or regulatory changes.




                                       3
<PAGE>
<TABLE>
<CAPTION>


PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements

                         LINCOLN BANCORP AND SUBSIDIARY
                      Consolidated Condensed Balance Sheets


                                                                                      March 31,           December 31,
                                                                                        2005                 2004
                                                                                --------------------- --------------------
                                                                                     (Unaudited)
<S>                                                                             <C>                   <C>
  Assets
       Cash and due from banks                                                  $     5,095,296       $     9,218,265
       Short-term interest-bearing demand deposits in other banks                    12,865,729            14,581,854
       Federal funds sold                                                               975,000             3,990,000
                                                                                --------------------- --------------------
           Cash and cash equivalents                                                 18,936,025            27,790,119
       Interest-bearing deposits                                                      1,999,452             2,188,111
       Investment securities
           Available for sale                                                       134,971,436           118,916,779
           Held to maturity (market value $1,695,000 and $1,745,000)                  1,665,000             1,695,000
                                                                                --------------------- --------------------
                Total investment securities                                         136,636,436           120,611,779
       Loans held for sale                                                            1,888,969             8,820,890
       Loans, net of allowance for loan losses of $5,745,000 and $5,701,000         578,629,139           567,182,726
       Premises and equipment                                                        14,780,475            14,416,140
       Investments in limited partnerships                                              979,777             1,024,777
       Federal Home Loan Bank stock                                                  10,538,100            10,427,000
       Interest receivable                                                            3,272,063             3,194,313
       Goodwill                                                                      23,906,877            23,906,877
       Core deposit intangible                                                        3,824,631             4,017,274
       Cash surrender value life insurance                                           17,972,704            17,751,275
       Other assets                                                                   6,054,413             7,635,652
                                                                                --------------------- --------------------

           Total assets                                                         $   819,419,061         $ 808,966,933
                                                                                ===================== ====================

  Liabilities
       Deposits
           Noninterest-bearing                                                  $    38,244,538         $  36,956,251
           Interest-bearing                                                         488,299,757           479,372,500
                                                                                --------------------- --------------------
                Total deposits                                                      526,544,295           516,328,751
       Securities sold under repurchase agreement                                     6,930,133             6,500,277
       Borrowings                                                                   170,829,812           177,829,382
       Interest payable                                                               1,367,687             1,145,877
       Other liabilities                                                             11,763,440             5,407,828
                                                                                --------------------- --------------------
           Total liabilities                                                        717,435,367           707,212,115
                                                                                --------------------- --------------------

  Commitments and Contingencies

  Shareholders' Equity
       Common stock, without par value
           Authorized - 20,000,000 shares
           Issued and outstanding - 5,399,653 and 5,366,563 shares                   63,895,579            63,533,976
       Retained earnings                                                             42,435,552            42,092,418
       Accumulated other comprehensive gain (loss)                                     (379,538)              182,864
       Unearned recognition and retention plan (RRP) shares                            (626,454)             (632,420)
       Unearned employee stock ownership plan (ESOP) shares                          (3,341,445)           (3,422,020)
                                                                                --------------------- --------------------
           Total shareholders' equity                                               101,983,694           101,754,818
                                                                                --------------------- --------------------

           Total liabilities and shareholders' equity                           $   819,419,061         $ 808,966,933
                                                                                ===================== ====================

  See notes to consolidated condensed financial statements.





                                       4
</TABLE>
<PAGE>
<TABLE>
<CAPTION>




                         LINCOLN BANCORP AND SUBSIDIARY
                   Consolidated Condensed Statements of Income
                                   (Unaudited)

                                                                       Three Months Ended
                                                                             March 31,
                                                               ------------------ -------------------
                                                                     2005                2004
                                                               ------------------ -------------------
<S>                                                                <C>               <C>
Interest Income
     Loans, including fees                                         $ 8,741,075       $  6,669,171
     Investment securities                                           1,186,100            692,707
     Deposits with financial institutions and Federal funds
         sold                                                           72,246             17,046
     Dividend income                                                   109,832            116,960
                                                               ------------------ -------------------
         Total interest and dividend income                         10,109,253          7,495,884
                                                               ------------------ -------------------

Interest Expense
     Deposits                                                        2,516,108          1,433,185
     Federal Home Loan Bank advances                                 1,960,833          2,034,194
     Other borrowings                                                   65,114                 --
                                                               ------------------ -------------------
         Total interest expense                                      4,542,055          3,467,379
                                                               ------------------ -------------------

Net Interest Income                                                  5,567,198          4,028,505
     Provision  for loan losses                                         13,509            200,172
                                                               ------------------ -------------------
Net Interest Income After Provision for Loan Losses                  5,553,689          3,828,333
                                                               ------------------ -------------------

Other Income
     Service charges on deposit accounts                               456,593            213,956
     Net realized and unrealized gains on loans                        214,519             70,366
     Point of sale income                                              119,182             86,689
     Loan servicing fees                                               106,436             82,901
     Increase in cash value of life insurance                          225,973            137,336
     Equity in losses of limited partnerships                          (45,000)           (33,000)
     Other income                                                      148,122            113,238
                                                               ------------------ -------------------
         Total other income                                          1,225,825            671,486
                                                               ------------------ -------------------

Other Expenses
     Salaries and employee benefits                                  2,635,095          1,853,601
     Net occupancy expenses                                            437,731            237,103
     Equipment expenses                                                408,902            185,787
     Advertising and business development                              170,508            102,997
     Data processing fees                                              622,327            360,719
     Professional fees                                                 123,533            114,952
     Director and committee fees                                       102,520             79,679
     Amortization of core deposit intangibles                          192,643             23,487
     Office supplies                                                   141,876             75,462
     Other expenses                                                    670,132            407,285
                                                               ------------------ -------------------
         Total other expenses                                        5,505,267          3,441,072
                                                               ------------------ -------------------

Income Before Income Tax                                             1,274,247          1,058,747
     Income tax expense                                                295,547            246,999
                                                               ------------------ -------------------

Net Income                                                        $    978,700       $    811,748
                                                               ================== ===================

Basic earnings per share                                          $        .20       $        .21
Diluted earnings per share                                                 .19                .20
Dividends per share                                                        .14                .13


See notes to consolidated condensed financial statements.

</TABLE>

                                       5
<PAGE>
<TABLE>
<CAPTION>



 LINCOLN BANCORP AND SUBSIDIARY

                    Consolidated Condensed Statements of Comprehensive Income
                                           (Unaudited)



                                                                         Three Months Ended
                                                                             March 31,
                                                                 ----------------- -----------------
                                                                       2005              2004
                                                                 ----------------- -----------------
<S>                                                                  <C>             <C>
  Net Income                                                         $ 978,700         $ 811,748
  Other comprehensive income, net of tax
        Unrealized losses on securities available for sale

            Unrealized holding gains (losses) arising during
            the period, net of tax expense (benefit) of
            ($317,410) and $226,147                                   (562,402)          438,815
                                                                 ----------------- -----------------
  Comprehensive income                                               $ 416,298        $1,250,563
                                                                 ================= =================



See notes to consolidated condensed financial statements.


</TABLE>





                                       6
<PAGE>
<TABLE>
<CAPTION>




                                                LINCOLN BANCORP AND SUBSIDIARY
                                   Consolidated Condensed Statement of Shareholders' Equity
                                           For the Three Months Ended March 31, 2005
                                                          (Unaudited)


                                         Common Stock                     Accumulated
                                 -------------------------                  Other                          Unearned
                                    Shares                   Retained    Comprehensive      Unearned         ESOP
                                 Outstanding    Amount       Earnings     Gain (Loss)     Compensation      Shares         Total
                                 ------------ ------------ ------------- --------------- --------------- ------------- -------------

<S>               <C>              <C>        <C>           <C>              <C>            <C>           <C>          <C>
Balances, January 1, 2005          5,366,563  $63,533,976   $42,092,418      $182,864       $(632,420)    $(3,422,020) $101,754,818

  Net income for the period                                     978,700                                                     978,700
  Unrealized gains (losses) on
    securities                                                               (562,402)                                     (562,402)
  Stock options exercised             33,090      361,603                                                                   361,603
  ESOP shares earned                                             70,703                                        80,575       151,278
  Amortization of unearned
    compensation expense                                          1,774                         5,966                         7,740
  Cash dividends ($.14
    per share)                                                 (708,043)                                                   (708,043)
                                 ------------ ------------ ------------- --------------- --------------- ------------- -------------

Balances, March 31, 2005           5,399,653  $63,895,579   $42,435,552    $ (379,538)     $ (626,454)    $(3,341,445) $101,983,694
                                 ============ ============ ============= =============== =============== ============= =============




See notes to consolidated condensed financial statements.



</TABLE>



                                       7
<PAGE>
<TABLE>
<CAPTION>


                                         LINCOLN BANCORP AND SUBSIDIARY
                                 Consolidated Condensed Statements of Cash Flows
                                                   (Unaudited)


                                                                                                 Three Months Ended
                                                                                                      March 31,
                                                                                         -------------------- -------------------
                                                                                               2005                2004
                                                                                         -------------------- -------------------
  Operating Activities
<S>                                                                                        <C>                 <C>
       Net income                                                                          $   978,700         $    811,748
       Adjustments to reconcile net income to net cash provided by
            (used in) operating activities
         Provision for loan losses                                                              13,509              200,172
         Investment securities (amortization)/accretion, net                                   (51,926)             (57,703)
         Loans originated for sale in the secondary market                                  (2,031,350)          (5,785,900)
         Proceeds from sale of loans in the secondary market                                 3,287,593            4,611,948
         Gain on sale of loans                                                                (214,519)             (70,366)
         Amortization of net loan origination fees                                             (74,020)             (71,035)
         Depreciation and amortization                                                         372,983              179,047
         Amortization of unearned compensation expense                                           7,740              152,990
         ESOP shares earned                                                                    151,278              170,566
         Net change in:
           Interest receivable                                                                 (77,750)             163,536
           Interest payable                                                                    221,810              (23,311)
         Other adjustments                                                                     978,672             (268,850)
                                                                                         -------------------- -------------------
                Net cash provided by operating activities                                    3,562,720               12,842
                                                                                         -------------------- -------------------

  Investing Activities
       Purchases of securities available for sale                                          (48,701,776)         (17,468,470)
       Proceeds from maturities of securities available for sale                            36,838,483           23,678,176
       Proceeds from maturities of securities held to maturity                                  30,000               25,000
       Net change in loans                                                                  (5,481,530)          (2,950,367)
       Purchases of property and equipment                                                    (746,466)            (611,142)
       Proceeds from sale of foreclosed real estate                                           1,297,993             116,000
       Other investing activities                                                               170,298                  --
                                                                                         -------------------- -------------------
                Net cash provided by (used in) investing activities                        (16,592,998)           2,789,197
                                                                                         -------------------- -------------------

  Financing Activities
       Net change in
          Noninterest-bearing, interest-bearing demand, money market and savings
             deposits                                                                      (11,588,539)           5,136,503
          Certificates of deposit                                                           21,941,651           (5,303,390)
          Short-term borrowings                                                                429,856                   --
       Proceeds from FHLB advances                                                           8,000,000            8,000,000
       Repayment of FHLB advances                                                          (15,000,000)         (21,000,000)
       Dividends paid                                                                         (703,411)            (524,714)
       Exercise of stock options                                                               361,603               81,250
       Net change in advances by borrowers for taxes and insurance                             735,024              676,101
                                                                                         -------------------- -------------------
                Net cash provided by financing activities                                    4,176,184          (12,934,250)
                                                                                         -------------------- -------------------

  Net Change in Cash and Cash Equivalents                                                   (8,854,094)         (10,132,211)

  Cash and Cash Equivalents, Beginning of Period                                            27,790,119           16,793,923
                                                                                         -------------------- -------------------

  Cash and Cash Equivalents, End of Period                                               $  18,936,025          $ 6,661,712
                                                                                         ==================== ===================

  Additional Cash Flows and Supplementary Information
       Interest paid                                                                     $   4,320,245          $ 3,490,690
       Income tax paid                                                                              --                   --
       Loan balances transferred to foreclosed real estate                                      54,865              166,652
       Security purchased not yet settled                                                    5,019,250                   --
       Transfer of loans held for sale to loans                                              5,872,116                   --


  See notes to consolidated condensed financial statements.



                                       8
</TABLE>
<PAGE>

                         LINCOLN BANCORP AND SUBSIDIARY
         Notes to Unaudited Consolidated Condensed Financial Statements

Note 1:  Basis of Presentation

The consolidated  financial  statements  include the accounts of Lincoln Bancorp
(the  "Company"),  its  wholly  owned  subsidiary,  Lincoln  Bank,  a  federally
chartered  savings bank  ("Lincoln" or the "Bank"),  and Lincoln's  wholly owned
subsidiaries,  LF Service  Corporation  ("LF  Service")  and  Citizens  Loan and
Service  Corporation  ("CLSC"),  both  Indiana  corporations,  and LF  Portfolio
Services,  Inc.  ("LF  Portfolio"),   a  Delaware  corporation.   A  summary  of
significant  accounting  policies  is set forth in Note 1 of Notes to  Financial
Statements included in the December 31, 2004 Annual Report to Shareholders.  All
significant  intercompany  accounts and  transactions  have been  eliminated  in
consolidation.

The interim  consolidated  financial statements have been prepared in accordance
with  instructions  to Form 10-Q, and therefore,  do not include all information
and footnotes necessary for a fair presentation of financial  position,  results
of operations and cash flows in conformity  with generally  accepted  accounting
principles.

The interim  consolidated  financial  statements at March 31, 2005,  and for the
three months ended March 31, 2005 and 2004, have not been audited by independent
accountants,  but reflect, in the opinion of management,  all adjustments (which
include  only normal  recurring  adjustments)  necessary  to present  fairly the
financial position,  results of operations and cash flows for such periods.  The
results of operations for the  three-month  period ended March 31, 2005, are not
necessarily indicative of the results which may be expected for the entire year.
The consolidated condensed balance sheet of the Company as of December 31, 2004,
has been derived from the audited  consolidated  balance sheet of the Company as
of that date.


Note 2:  Earnings Per Share

Earnings per share have been  computed  based upon the  weighted-average  common
shares  outstanding.  Unearned  Employee  Stock  Ownership Plan shares have been
excluded from the computation of average common shares outstanding.


<TABLE>
<CAPTION>


                                              Three Months Ended                         Three Months Ended
                                                March 31, 2005                             March 31, 2004
                                      ---------------------------------         -----------------------------------
                                                  Weighted         Per                     Weighted       Per
                                                   Average        Share                     Average      Share
                                      Income       Shares        Amount         Income      Shares       Amount
                                      ------      --------       ------         ------     --------      ------
<S>                                      <C>         <C>          <C>          <C>         <C>           <C>
     Basic earnings per share
       Income available to
       common shareholders               $978,700    5,001,750    $ .20        $811,748    3,950,280     $ .21
                                                                  =====                                  ======

     Effect of dilutive RRP
     awards and stock options                          137,119                               159,954
                                    --------------------------                 ---------------------
     Diluted earnings per share
       Income available to
       common shareholders and
       assumed conversions
                                         $978,700    5,138,869    $ .19        $811,748    4,110,234     $ .20
                                    ==========================================================================


</TABLE>

                                       9
<PAGE>


Note 3:  Stock Options

The Company has a stock-based  employee  compensation  plan,  which is described
more fully in Notes to  Financial  Statements  included in the December 31, 2004
Annual  Report to  Shareholders.  The Company  accounts  for this plan under the
recognition  and  measurement  principles of APB Opinion No. 25,  Accounting for
Stock Issued to Employees, and related interpretations.  No stock-based employee
compensation  cost is reflected in net income,  as all options granted under the
plan had an exercise  price equal to the market value of the  underlying  common
stock on the grant  date.  The  following  table  illustrates  the effect on net
income  and  earnings  per  share if the  Company  had  applied  the fair  value
provisions  of  Statement of Financial  Accounting  Standards  ("SFAS") No. 123,
Accounting for Stock-Based Compensation, to stock-based employee compensation.


                                              Three Months     Three Months
                                                 Ended             Ended
                                                March 31,        March 31,
                                                  2005             2004
                                           ----------------------------------

     Net income, as reported                    $978,700         $ 811,748
     Less:  Total stock-based employee
         compensation cost determined
         under the fair value based
         method, net of income taxes              25,144             9,104
                                           ----------------------------------

     Pro forma net income                       $953,566         $ 802,644
                                           ==================================

     Earnings per share:
         Basic - as reported                    $    .20         $     .21
         Basic - pro forma                           .19         $     .20
         Diluted - as reported                       .19         $     .20
         Diluted - pro forma                         .19         $     .20


In December,  2004, the Financial  Accounting  Standards  Board (FASB) issued an
amendment  to SFAS 123 (SFAS 123R) which  eliminates  the ability to account for
share-based compensation  transactions using Accounting Principles Board Opinion
No. 25 and generally  requires that such  transactions  be accounted for using a
fair value-based  method.  SFAS 123R will be effective for the Company beginning
January 1, 2006.  SFAS 123R  applies to all awards  granted  after the  required
effective  date and to awards  modified,  repurchased,  or cancelled  after that
date. The cumulative  effect of initially  applying this  Statement,  if any, is
recognized as of the required effective date.

As of the required effective date, the Company will apply SFAS 123R using either
the modified  version of  prospective  application  or the  modified  version of
retrospective application. Under the prospective transition method, compensation
cost is  recognized on or after the required  effective  date for the portion of
outstanding  awards for which the requisite  service has not yet been  rendered,
based on the grant-date fair value of those awards calculated under SFAS 123 for
either  recognition  or pro forma  disclosures.  For periods before the required
effective date, a company may elect to apply a modified version of retrospective
application under which financial statements for prior periods are adjusted on a
basis  consistent with the pro forma  disclosures  required for those periods by
SFAS 123.

The  Company  is  currently   evaluating  the  effect  of  the  recognition  and
measurement  provisions of SFAS 123R but believes the adoption of SFAS 123R will
not result in a material  impact on the Company's  results of  operations,  cash
flows or financial position.


                                       10
<PAGE>


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

General

The Company was  organized in September  1998. On December 30, 1998, it acquired
the common stock of Lincoln upon the conversion of Lincoln from a federal mutual
savings bank to a federal stock savings bank.

Lincoln Bank was originally organized in 1884 as Ladoga Federal Savings and Loan
Association,  located in Ladoga,  Indiana.  In 1979 Ladoga  Federal  merged with
Plainfield  First Federal  Savings and Loan  Association,  a federal savings and
loan association located in Plainfield,  Indiana which was originally  organized
in 1896.  Following  the merger,  the Bank  changed its name to Lincoln  Federal
Savings and Loan  Association  and, in 1984,  adopted the name,  Lincoln Federal
Savings Bank.  On September 1, 2003,  the Bank adopted the name Lincoln Bank. On
August 2, 2004,  the Company  acquired First Shares  Bancorp,  Inc., the holding
company of First Bank, an Indiana  commercial Bank. First Shares was merged with
and into the  Company  and  immediately  thereafter,  First Bank was merged into
Lincoln  Bank.  Lincoln  currently  conducts its business  from 17  full-service
offices located in Hendricks,  Johnson, Morgan, Clinton,  Montgomery,  and Brown
Counties, Indiana, with its main office located in Plainfield.

Lincoln offers a variety of lending, deposit and other financial services to its
retail and  commercial  customers.  The Bank's  principal  business  consists of
attracting  deposits  from the general  public and  originating  fixed-rate  and
adjustable-rate  loans  secured  primarily  by first  mortgage  liens on one- to
four-family  residential real estate and commercial property.  Lincoln's deposit
accounts  are  insured  up to  applicable  limits  by  the  Savings  Association
Insurance Fund of the Federal Deposit  Insurance  Corporation.  Lincoln offers a
number of financial services, which includes: (i) one-to four-family residential
real  estate  loans;  (ii)  commercial  real  estate  loans;  (iii) real  estate
construction  loans; (iv) land loans; (v) multi-family  residential  loans; (vi)
consumer  loans,  including  home  equity  loans  and  automobile  loans;  (vii)
commercial  loans;  (viii) money market demand accounts;  (ix) savings accounts;
(x) checking accounts;  (xi) NOW accounts;  (xii)  certificates of deposit;  and
(xiii) financial planning.

Lincoln  currently  owns three  subsidiaries.  First,  LF Service,  whose assets
consist of an investment in Family Financial Holdings, Inc. ("Family Financial")
and in Bloomington Housing Associates,  L.P. ("BHA"). Family Financial primarily
engages  in  retail  sales  of  insurance  products  in  connection  with  loans
originated by its shareholder financial institutions.  BHA is an Indiana limited
partnership  that  was  organized  to  construct,  own and  operate  a  130-unit
apartment  complex in Bloomington,  Indiana (the "BHA Project").  Development of
the BHA Project was  completed in 1993 and the project is performing as planned.
Second,  CLSC, which primarily engages in the purchase and development of tracts
of undeveloped land. Because CLSC engages in activities that are not permissible
for a national  bank,  OTS  regulations  prohibit  Lincoln  from  including  its
investment in CLSC in its  calculation  of regulatory  capital.  CLSC  purchases
undeveloped land,  constructs  improvements and  infrastructure on the land, and
then sells lots for residential home construction. Third, LF Portfolio, which is
located  in  Nevada,  holds  and  manages a  significant  portion  of  Lincoln's
investment portfolio.

Lincoln's  results of operations depend primarily upon the level of net interest
income,   which  is  the  difference  between  the  interest  income  earned  on
interest-earning assets, such as loans and investments,  and costs incurred with
respect to  interest-bearing  liabilities,  primarily  deposits and  borrowings.
Results of  operations  also  depend  upon the level of  Lincoln's  non-interest
income,  including  fee  income  and  service  charges  and  the  level  of  its
non-interest expenses, including general and administrative expenses.


Critical Accounting Policies

Note 1 to the  consolidated  financial  statements  contains  a  summary  of the
Company's  significant  accounting  policies presented on pages 28 through 31 of
the Annual Report to  Shareholders  for the year ended December 31, 2004,  which
was filed on Form 10-K with the Securities and Exchange  Commission on March 31,
2005.  Certain of these policies are important to the portrayal of the Company's
financial condition, since they require management to make difficult, complex or
subjective  judgments,  some of which may relate to matters that are  inherently
uncertain.  Management  believes that its critical  accounting  policies include
determining the allowance for loan losses,  the valuation of mortgage  servicing
rights, and the valuation of intangible assets.



                                       11
<PAGE>

Allowance for loan losses

The  allowance  for loan  losses  represents  management's  estimate of probable
losses inherent in the Company's loan portfolios. In determining the appropriate
amount of the allowance for loan losses,  management makes numerous assumptions,
estimates and assessments.

The  Company's  strategy  for  credit  risk  management  includes  conservative,
centralized credit policies,  and uniform underwriting criteria for all loans as
well as an overall  credit  limit for each  customer  significantly  below legal
lending limits.  The strategy also emphasizes  diversification  on a geographic,
industry  and customer  level,  regular  credit  quality  reviews and  quarterly
management   reviews  of  large   credit   exposures   and  loans   experiencing
deterioration  of credit  quality.  A standard  credit scoring system is used to
assess credit risks during the loan approval process of all consumer loans while
commercial  loans are  individually  reviewed  by a credit  analyst  with formal
presentations to the Bank's Loan Committee.

The Company's allowance consists of three components:  probable losses estimated
from  individual  reviews of specific loans and probable  losses  estimated from
historical loss rates.  Also,  probable losses  resulting from economic or other
deterioration  above and beyond what is reflected in the first two components of
the allowance are considered.

Larger  commercial loans that exhibit probable or observed credit weaknesses are
subject to  individual  review.  Where  appropriate,  reserves are  allocated to
individual  loans based on  management's  estimate of the borrower's  ability to
repay the loan given the availability of collateral,  other sources of cash flow
and legal options available to the Company. Included in the review of individual
loans are those that are  impaired as provided  in SFAS No. 114,  Accounting  by
Creditors  for  Impairment  of a Loan.  Any  allowances  for impaired  loans are
measured based on the present value of expected future cash flows  discounted at
the loan's effective  interest rate or fair value of the underlying  collateral.
The Company  evaluates the  collectibility  of both  principal and interest when
assessing the need for a loss accrual. Estimated loss rates are applied to other
commercial loans not subject to specific reserve  allocations.

Homogenous  loans, such as consumer  installment and residential  mortgage loans
are not individually  risk graded.  Rather,  standard credit scoring systems are
used to assess credit risks. Reserves are established for each category of loans
based on the expected net  charge-offs for one year. Loss rates are based on the
average net  charge-off  estimated by loan  category.  Allowances  on individual
loans and historical loss rates are reviewed quarterly and adjusted as necessary
based on changing borrower and/or collateral conditions.

The  Company's  primary  market  area  for  lending  is  central  Indiana.  When
evaluating  the adequacy of allowance,  consideration  is given to this regional
geographic  concentration  and the closely  associated  effect changing economic
conditions have on the Company's customers.

The Company has not substantively  changed any aspect to its overall approach in
the determination of the allowance for loan losses.  There have been no material
changes in  assumptions  or  estimation  techniques as compared to prior periods
that impacted the determination of the current period allowance.


Mortgage servicing rights

The Company  recognizes  the rights to service sold  mortgage  loans as separate
assets in the  consolidated  balance sheet. The total cost of loans when sold is
allocated between loans and mortgage servicing rights based on the relative fair
values of each. Mortgage servicing rights are subsequently  carried at the lower
of the  initial  carrying  value,  adjusted  for  amortization,  or fair  value.
Mortgage  servicing  rights are evaluated for impairment based on the fair value
of those  rights.  Factors  included  in the  calculation  of fair  value of the
mortgage  servicing  rights  include  estimating the present value of future net
cash flows,  market loan  prepayment  speeds for similar loans,  discount rates,
servicing costs, and other economic factors. Servicing rights are amortized over
the estimated period of net servicing revenue.  It is likely that these economic
factors will change over the life of the mortgage servicing rights, resulting in
different  valuations of the mortgage servicing rights. The differing valuations
will  affect  the  carrying  value  of  the  mortgage  servicing  rights  on the
consolidated  balance sheet as well as the amounts  recorded in the consolidated
income statement.




                                       12
<PAGE>

Intangible assets

Management  periodically  assesses  the  impairment  of  its  goodwill  and  the
recoverability of its core deposit intangible.  Impairment is the condition that
exists when the carrying  amount of goodwill  exceeds its implied fair value. If
actual external conditions and future operating results differ from management's
judgments,  impairment and/or increased amortization charges may be necessary to
reduce the carrying value of these assets to the appropriate value.


Financial Condition

Assets  totaled  $819.4 million at March 31, 2005, an increase from December 31,
2004 of $10.4  million.  The  increase in assets  occurred  in net loans,  which
increased $11.4 million,  and investment  securities  available for sale,  which
increased  $16.0 million.  This increase was partially  offset by a $8.9 million
decline in cash and cash  equivalents  and a $6.9 million  decline in loans held
for sale. Loan growth was  experienced in commercial and consumer  lending since
December 31, 2004. The decline in cash and cash  equivalents was reinvested into
securities available for sale.

Total  deposits  were  $526.5  million at March 31,  2005,  an increase of $10.2
million  from the $516.3  million at  December  31,  2004.  Growth  occurred  in
certificates  of deposit,  which  increased  $21.8  million,  while money market
deposits  declined by $13.4 million as a result of high  competitive  pricing in
the  market  for  money  market   deposits  and  the  migration  of  funds  into
certificates of deposit.  Borrowings declined by $7.0 million from year end 2004
to $170.8 million at March 31, 2005.

Shareholders'  equity  increased  $229,000  from  December 31, 2004 to March 31,
2005. Shareholders' equity increased due to net income of $979,000 stock options
exercised of $362,000,  Employee Stock Ownership Plan shares earned of $151,000,
unearned compensation  amortization of $7,000 and a decrease in unrealized gains
on  investment  securities  available  for sale of $562,000.  Cash  dividends of
$708,000 were declared during the first quarter.


Comparison  of  Operating  Results for the Three Months Ended March 31, 2005 and
2004

Net income for the first quarter ended March 31, 2005 was $979,000,  or $.20 for
basic and $.19 for diluted  earnings per share.  This compared to net income for
the  comparable  period in 2004 of $812,000,  or $.21 for basic and $.20 diluted
earnings per share. Return on assets was .48% and return on equity was 3.80% for
the first quarter of 2005 compared to .55% and 4.04%, respectively, for the same
period last year.

Net interest  income for the first  quarter of 2005 was  $5,567,000  compared to
$4,029,000  for the same period in 2004.  Net interest  margin was 3.00% for the
three-month period ended March 31, 2005 compared to 2.88% for the same period in
2004. The average yield on earning assets  increased 9 basis points in the first
quarter  2005  compared  to the same  period in 2004 while the  average  cost of
interest-bearing  liabilities declined 11 basis points for the same period. This
increased  the  interest  rate  spread  from 2.51% at March 31, 2004 to 2.71% at
March 31, 2005, or 20 basis points.  The  acquisition  of First Shares  Bancorp,
effective  August 2, 2004,  provided a boost to earning  assets and net interest
margin.  The merger provided a greater mix of commercial and consumer loans with
higher yields.

The Bank's  provision  for loan losses for the first quarter of 2005 was $14,000
compared to $200,000 for the same period in 2004.  Nonperforming  loans to total
loans at March 31, 2005  increased  slightly  to .95% from .87% at December  31,
2004.  Nonperforming assets to total assets were .74% at March 31, 2005 compared
to .85% at December  31,  2004.  The  allowance  for loan losses as a percent of
loans was .98% at both March 31, 2005 and  December  31,  2004.  Analysis of the
allowance  for loan losses at March 31, 2005  indicated  no further  adjustments
were necessary at this time. During the quarter,  the Bank recognized $31,000 in
net recoveries on previously charged-off loans.

Other income for the three months ended March 31, 2005 was  $1,226,000  compared
to  $671,000  for the same  quarter of 2004.  The  increase of $555,000 in other
income was primarily from the increase in service  charges on deposit  accounts,
which increased  $243,000;  net realized and unrealized  gains on sale of loans,
which  increased  $145,000;  and an  $89,000  increase  in  cash  value  of life
insurance.  The  majority of the service  charge  increase was the result of the
implementation




                                       13
<PAGE>

of the Bank's courtesy overdraft program Lincoln Advantage in the second quarter
of 2004. In addition,  the merger of First Shares added service  charge  revenue
during the first quarter of 2005. During the first quarter of 2004 the Bank also
sold  residential  mortgages while retaining the servicing  rights.  During 2005
most loan  volume is sold with  servicing  released  to the buyer.  In  general,
premiums  received on loans sold with servicing  released  exceed those received
where servicing is retained by the Bank. Cash value of life insurance  increased
from the  addition  of  policies  held by First  Bank as a result of the  merger
August 2, 2004, plus an increase in dividend rate.

Other  expenses  were  $5,505,000  for the three  months  ended  March 31,  2005
compared to $3,441,000 for the same three months of 2004. The primary reason for
the increase in expenses was the  acquisition of First Shares Bancorp during the
third quarter of 2004.  Full-time  equivalent employees increased from 132.0 for
the quarter ended March 31, 2004 to 220.8 for quarter ended March 31, 2005.  Our
branch  locations  increased  from nine to  seventeen  from the end of the first
quarter in 2004 to the end of the same quarter in 2005.


Asset Quality

The Company currently classifies loans as special mention, substandard, doubtful
and loss to assist  management  in addressing  collection  risks and pursuant to
regulatory  requirements.  Special  mention  loans  represent  credits that have
potential  weaknesses  that  deserve  management's  close  attention.   If  left
uncorrected,  these  potential  weaknesses  may result in  deterioration  of the
repayment   prospects  or  Lincoln's   credit  position  at  some  future  date.
Substandard  loans represent credits  characterized by the distinct  possibility
that some loss will be sustained if deficiencies on the loans are not corrected.
Doubtful loans possess the  characteristics of substandard loans, but collection
or  liquidation in full is doubtful  based upon existing  facts,  conditions and
values.  A loan  classified as a loss is considered  uncollectible.  Lincoln had
$14.2  million and $19.4 million of loans  classified  as special  mention as of
March 31, 2005 and  December 31, 2004,  respectively.  In addition,  Lincoln had
$6.6 million and $5.7 million of loans  classified as  substandard  at March 31,
2005 and December 31, 2004,  respectively.  Loans classified as doubtful totaled
$233,000 at both March 31, 2005 and  December  31,  2004.  At March 31, 2005 and
December 31, 2004,  no loans were  classified  as loss.  At March 31, 2005,  and
December 31, 2004,  respectively,  non-accrual  loans were $5.3 million and $4.8
million. At March 31, 2005 and December 31, 2004,  respectively,  accruing loans
delinquent 90 days or more totaled $212,000 and $314,000.  At March 31, 2005 and
December  31,  2004,  the  allowance  for loan losses was $5.7  million and $5.7
million,  respectively or approximately .98% and .98% of loans,  including loans
held for sale, respectively.


Liquidity and Capital Resources

The Financial  Regulatory Relief and Economic  Efficiency Act of 2000, which was
signed into law on December 27, 2000, repealed the former statutory  requirement
that all savings associations maintain an average daily balance of liquid assets
in a minimum  amount of not less than 4% or more than 10% of their  withdrawable
accounts plus  short-term  borrowings.  The OTS adopted a rule that  implemented
this revised statutory requirement, although savings associations remain subject
to the OTS  regulation  that requires them to maintain  sufficient  liquidity to
ensure their safe and sound operation.

Pursuant  to OTS  capital  regulations  in  effect at March  31,  2005,  savings
associations were required to maintain a 1.5% tangible capital requirement, a 4%
leverage ratio (or core capital) requirement,  and a total risk-based capital to
risk-weighted  assets ratio of 8%. At March 31, 2005,  Lincoln's  capital levels
exceeded all applicable  regulatory  capital  requirements  in effect as of that
date.


Other

The  Securities  and  Exchange  Commission  maintains  a Web site that  contains
reports,   proxy  information   statements,   and  other  information  regarding
registrants that file electronically with the Commission, including the Company.
The address is http://www.sec.gov.




                                       14
<PAGE>

Subsequent Events

At March 31, 2005, loans to a certain borrower totaling $2.2 million were
classified as substandard and appropriate reserves were assigned based on the
information available. In April 2005, the Bank was notified of certain
additional problems experienced by this borrower. Subsequent to that date, the
borrower filed for bankruptcy protection under Chapter 7 of the U.S. Bankruptcy
Code. The initial bankruptcy hearings have taken place but the borrower has
received two extensions of time to file certain schedules necessary for a
creditor meeting to take place.

As of May 16, 2005, a creditors' meeting is tentatively scheduled for June 10,
2005. Pending the results of this meeting, the Bank is unable to determine its
ultimate collateral position and related losses. The Bank will continue to
monitor this situation closely and provide for any additional losses as
information becomes available.


Item 3. Quantitative and Qualitative Disclosures About Market Risk

Presented  below, as of December 31, 2004 and 2003, is an analysis  performed by
the OTS of Lincoln's  interest rate risk as measured by changes in Lincoln's net
portfolio value ("NPV") for instantaneous  and sustained  parallel shifts in the
yield  curve,  in 100 basis point  increments,  up 300 basis points and down 100
basis points.

                                December 31, 2004
                                -----------------

                        Net Portfolio Value          NPV as % of PV of Assets
    Changes
    In Rates   $ Amount    $ Change       %Change      NPV Ratio      Change
    --------   --------    ---------      -------      ---------      ------
                             (Dollars in thousands)

    +300 bp     $69,053     (16,332)        (19)%         9.00%      (168) bp
    +200 bp      76,161      (9,224)        (11)          9.79        (90) bp
    +100 bp      81,958      (3,426)         (4)         10.39        (30) bp
       0 bp      85,385                                  10.69
    -100 bp      84,237      (1,148)         (1)         10.45        (24) bp



                                December 31, 2003
                                -----------------

                        Net Portfolio Value          NPV as % of PV of Assets
    Changes
    In Rates   $ Amount    $ Change       %Change      NPV Ratio      Change
    --------   --------    ---------      -------      ---------      ------
                             (Dollars in thousands)

    +300 bp     $56,836    $(15,957)        (22)%         9.77%      (208) bp
    +200 bp      64,353      (8,441)        (12)         10.84       (102) bp
    +100 bp      69,694      (3,099)         (4)         11.53        (32) bp
       0 bp      72,794                                  11.85
    -100 bp      71,494      (1,300)         (2)         11.52        (34) bp

Management  believes that at March 31, 2005, there have been no material changes
in Lincoln's  interest rate sensitive  instruments  which would cause a material
change  in  the  market  risk  exposures  which  affect  the   quantitative  and
qualitative  risk  disclosures  as presented in Item 7A of the Company's  Annual
Report on Form 10-K for the period ended December 31, 2004.


Item 4.  Controls and Procedures

(a)  Evaluation  of disclosure  controls and  procedures.  The  Company's  chief
executive   officer  and  chief   financial   officer,   after   evaluating  the
effectiveness of the Company's disclosure controls and procedures (as defined in
Sections  13a-15(e)  and  15d-15(e)  of the  regulations  promulgated  under the
Securities  Exchange Act of 1934, as amended),  as of the end of the most recent
fiscal quarter covered by this quarterly  report (the "Evaluation  Date"),  have
concluded that as of the Evaluation Date, the Company's  disclosure controls and
procedures  were adequate and are designed to ensure that  material  information
relating to the Company  would be made known to such  officers by others  within
the Company on a timely basis.

(b)  Changes in  internal  controls.  There were no  significant  changes in the
Company's  internal  control over financial  reporting  identified in connection
with the Company's  evaluation  of controls  that occurred  during the Company's
last fiscal quarter that has  materially  affected,  or is reasonably  likely to
materially affect, the Company's internal control over financial reporting.




                                       15
<PAGE>

PART II.   OTHER INFORMATION

Item 1. Legal Proceedings

     In  connection  with the Bank's  2004,  2003 and 2000  examinations  by the
     Office of Thrift Supervision (the "OTS"), the OTS found certain failures of
     the Bank to comply with various laws and  regulations,  including  the Bank
     Secrecy Act, the Flood  Disaster  Protection Act (the "FDPA") and the Truth
     in  Lending  Act  ("TILA").  Effective  May 2,  2005,  the Bank  executed a
     Stipulation and Consent to the Issuance of an Order to Cease and Desist for
     Affirmative Relief ("C&D Stipulation") and a Stipulation and Consent to the
     Issuance  of  an  Order  of   Assessment   of  Civil  Money  Penalty  ("CMP
     Stipulation"),  and the OTS issued a Consent  Order to Cease and Desist for
     Affirmative  Relief (the "C&D Order") and an Order of  Assessment  of Civil
     Money Penalty (the "CMP Order").

     Pursuant to the C&D Stipulation and C&D Order,  the Bank has agreed to take
     a  number  of  actions  within  specified  timeframes,  including  promptly
     reviewing and correcting any deficiencies and noncompliance  under the FDPA
     and TILA and revising its BSA, FDPA and TILA policies and  procedures.  The
     Bank has  agreed to engage an  outside  third  party to review and test the
     Bank's BSA compliance  program,  including a review of  transactions  since
     August 1, 2003,  and the Bank also has agreed to include in its revised BSA
     policy a requirement for annual  independent  testing of its BSA compliance
     program.  The revisions to the Bank's FDPA and TILA policies are to include
     requirements  for additional  training of lending staff on the requirements
     of the FDPA  and TILA  laws and  regulations  and also are to  require  the
     Bank's  internal  auditor  or  independent  compliance  officer  to conduct
     quarterly reviews to assess the Bank's FDPA and TILA compliance.

     The  Bank's  Board of  Directors  also has  agreed  to  review  the  Bank's
     compliance  deficiencies  and to prepare and adopt a staffing plan designed
     to strengthen and improve the Bank's  management and operations.  The Board
     is required to appoint a Regulatory  Compliance Committee (the "Committee")
     to monitor and coordinate  the Bank's  compliance  with the C&D Order.  The
     Committee  must  submit to the Board  for each  quarter a written  progress
     report on the actions taken to comply with the C&D Order. The directors are
     required  to certify  in  writing  that they have  reviewed  the  quarterly
     Committee reports,  and the reports and director  certifications,  together
     with any Board comments, are to be submitted to the OTS Regional Director.

     Pursuant to the CMP Stipulation and the CMP Order, the OTS assessed and the
     Bank has paid a civil money  penalty in the amount of $8,400 for the Bank's
     alleged  failure to comply with the FDPA.  The Bank's Board and  management
     are   continuing  to  take  the  actions   necessary  to  comply  with  the
     Stipulations and Orders.


Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

     The Company announced a stock repurchase  program on April 23, 2003, and up
     to 127,963  additional  shares may still be repurchased under that program.
     No shares were  repurchased  during the quarter  ended March 31, 2005.  The
     repurchase program does not have an expiration date.

Item 3. Defaults Upon Senior Securities

     None.

Item 4. Submission of Matters to a Vote of Security Holders

     None



                                       16
<PAGE>



Item 5. Other Information

     As  previously  reported  in a Current  Report  on Form  8-K,  T. Tim Unger
     resigned and retired  from his  positions as the  Chairman,  President  and
     Chief Executive  Officer of the Company and the Bank effective May 1, 2005,
     and will retire from the  position of Chairman of the Board of Directors of
     the Company  effective June 1, 2005. A Severance  Agreement,  dated May 12,
     2005,  among  the  Company,  the  Bank  and  Mr.  Unger,  provides  for the
     termination of Mr. Unger's Employment Agreement with the Bank effective May
     31,  2005.  Pursuant to the  Severance  Agreement,  Mr.  Unger will be paid
     compensation  at his current rate until December 31, 2005, and also will be
     paid the  amounts  of  matching  contributions  that would have made on his
     behalf under the Company's 401(k) Plan and the amount of contributions that
     would have been allocated to his account under the Company's Employee Stock
     Ownership  Plan had he remained  employed  through  December 31, 2005.  The
     Severance  Agreement also contains a general  release and waiver of certain
     claims and confidentiality and  non-competition  provisions.  A copy of the
     Severance Agreement is attached as Exhibit 10(1) to this Report.


Item 6. Exhibits

     The  exhibits  listed  in the  Exhibit  Index  are  incorporated  herein by
     reference.







                                       17
<PAGE>



                                   SIGNATURES

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


                                      LINCOLN BANCORP


Date:   May 16, 2005                  By: /s/ Jerry R. Engle
                                          --------------------------------------
                                          Jerry R. Engle
                                          President and Chief Executive Officer


Date:   May 16, 2005                  By: /s/ John M. Baer
                                          --------------------------------------
                                          John M. Baer
                                          Secretary and Treasurer



                                       18
<PAGE>



                                  EXHIBIT INDEX







   Exhibit No.                     Description                         Location
   -----------                     -----------                         --------

     10(1)           Severance Agreement, dated May 12, 2005,          Attached
                     among Lincoln Bancorp, Lincoln Bank and
                     T. Tim Unger

     31(1)           Certification required by 17 C.F.R. Section       Attached
                     240.13a-14(a)

     31(2)           Certification required by 17 C.F.R. Section       Attached
                     240.13a-14(a)

     32              Certification pursuant to 18 U.S.C.               Attached
                     Section 1350, as adopted pursuant to
                     Section 906 of the Sarbanes-Oxley Act of
                     2002






                                       19