U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   FORM 10-QSB

                                   (MARK ONE)

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

                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1998


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

       FOR THE TRANSITION PERIOD FROM _______________ TO ________________

                         COMMISSION FILE NUMBER 0-22435

                                 FIRSTBANK CORP.

        (EXACT NAME OF SMALL BUSINESS ISSUER AS SPECIFIED IN ITS CHARTER)


                  DELAWARE                              84-1389562
      (STATE OR OTHER JURISDICTION OF                (I.R.S. EMPLOYER
       INCORPORATION OR ORGANIZATION)               IDENTIFICATION NO.)

                       920 MAIN STREET, LEWISTON, ID 83501

                     ADDRESS OF PRINCIPAL EXECUTIVE OFFICES

                                 (208) 746-9610

                (ISSUER'S TELEPHONE NUMBER, INCLUDING AREA CODE)

              (FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR,
                          IF CHANGED SINCE LAST REPORT)

Check whether the issuer:  (1) filed all reports required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 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.

      (X) Yes         ( ) No


                      APPLICABLE ONLY TO CORPORATE ISSUERS

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

Common Stock 1,983,750 shares outstanding on September 30, 1998

Transitional Small Business Disclosure Format (check one):

      ( ) Yes         (X) No
<PAGE>
                                 FIRSTBANK CORP.
                                TABLE OF CONTENTS


PART I.  FINANCIAL INFORMATION

<TABLE>
<CAPTION>
                                                                                      Page
                                                                                      ----
<S>    <C>                                                                             <C>
Item   1. Financial Statements

          Consolidated Statements of Financial Condition                                    
            As of September 30, 1998 and March 31, 1998                                 1
          Consolidated Statements of Income                                               
            For the three months and six months ended September 30, 1998 and   1997     2
          Consolidated Statements of Cash Flows                                           
            For the six months ended September 30, 1998 and 1997                        3
          Consolidated Statements of Comprehensive Income                               
            For the three months and six months ended September 30, 1998 and 1997       4
          Notes to Consolidated Financial Statements                                  5 - 6

Item   2. Management's Discussion and Analysis of Financial
          Condition and Results of Operations                                         6 - 9

PART II.  OTHER INFORMATION

Item   1. Legal Proceedings                                                             10
Item   2. Changes in Securities                                                         10
Item   3. Defaults Upon Senior Securities                                               10
Item   4. Submission of Matters to a Vote of Security Holders                           10
Item   5. Other Information                                                             10
Item   6. Exhibits and Reports on Form 8-K                                              10
</TABLE>
<PAGE>

PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements

                                       FirstBank Corp. and Subsidiaries
                                Consolidated Statements of Financial Condition

<TABLE>
<CAPTION>
                                                                              At September 30,   At  March 31,
                                                                                    1998             1998
                                                                                ------------     ------------
                                                                                 (Unaudited)
<S>                                                                             <C>              <C>
ASSETS
Cash and cash equivalents:
  Non-interest bearing deposits                                                 $  7,255,498    $  5,443,129
  Interest bearing deposits                                                        7,324,890       1,139,185
  Federal funds sold                                                               1,944,952       1,834,506
                                                                                ------------    ------------
Total cash and cash equivalents                                                   16,525,340       8,416,820

Investment securities:
  Held-to-maturity                                                                 1,699,375       2,449,375
  Available-for-sale                                                               5,015,963       2,654,233
Mortgage-backed securities:
  Held-to-maturity                                                                 2,951,910       3,420,153
  Available-for-sale                                                               7,959,199       7,969,533
Certificates of deposit                                                              991,000         991,000
Loans receivable, net                                                            155,010,418     145,696,660
Accrued interest receivable                                                        2,137,486       1,374,239
Real estate owned                                                                    505,580         883,441
Stock in FHLB, at cost                                                             2,408,275       2,110,075
Premises and equipment, net                                                        4,702,872       4,705,829
Income taxes receivable                                                                    0         468,807
Cash surrender value of life insurance policies                                    1,548,232       1,400,055
Mortgage servicing assets                                                            661,292         406,666
Other assets                                                                         253,490         616,284
                                                                                ------------    ------------
TOTAL ASSETS                                                                    $202,370,432    $183,563,170
                                                                                ============    ============

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
  Deposits                                                                      $123,164,552    $114,495,090
  Advances from borrowers for taxes and insurance                                  1,332,536       1,329,080
  Advances from FHLB                                                              47,227,106      35,655,579
  Income taxes payable                                                               267,903               0
  Deferred federal and state income taxes                                            263,509         245,017
- Accrued expenses and other liabilities                                           1,274,974       1,830,406
                                                                                ------------    ------------
Total Liabilities                                                                173,530,580     153,555,172
                                                                                ------------    ------------
Stockholders' Equity (Note 4):
  Preferred stock, $.01 par value, 500,000 shares authorized; 0 shares issued
      and outstanding                                                                      0               0
  Common stock, $.01 par value, 5,000,000 shares authorized; 1,983,750
      shares issued; 1,963,913 and 1,983,750 shares outstanding,                      19,838          19,838
  Additional paid-in-capital                                                      18,696,639      18,989,977
  Retained earnings, substantially restricted                                     13,152,853      12,493,990
  Unearned ESOP shares (Note 3):                                                  (1,420,860)     (1,493,430)
  Deferred compensation                                                           (1,233,615)              0
  Treasury stock, at cost; 19,337 and 0 shares                                      (404,947)              0
  Accumulated comprehensive gain (loss):
      Unrealized gains (losses) on securities available-for-sale, net of tax          29,944          (2,377)
                                                                                ------------    ------------
Total Stockholders' Equity                                                        28,839,852      30,007,998
                                                                                ------------    ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                      $202,370,432    $183,563,170
                                                                                ============    ============

See accompanying notes to consolidated financial statements

                                                                                                           1
</TABLE>
<PAGE>

                        FirstBank Corp. and Subsidiaries
                        Consolidated Statements of Income


<TABLE>
<CAPTION>
                                                  Three-months ended September 30,   Six-months ended September 30,
                                                         1998         1997                 1998         1997
                                                      ----------   ----------           ----------   ----------
                                                                             (Unaudited)
<S>                                                   <C>          <C>                  <C>          <C>
Interest income:
  Loans receivable                                    $3,467,800   $2,921,401           $6,656,442   $5,587,142
  Mortgage-backed securities                             161,860      122,633              329,938      219,787
  Investment securities                                   71,115      111,674              138,910      183,500
  Other interest earning assets                          217,301      312,071              378,109      375,643
                                                      ----------   ----------           ----------   ----------
Total interest income                                  3,918,076    3,467,779            7,503,399    6,366,072

Interest expense:
  Deposits                                             1,236,110    1,133,521            2,455,542    2,303,632
  Advances from FHLB                                     637,004      524,007            1,162,416      855,537
                                                      ----------   ----------           ----------   ----------
Total interest expense                                 1,873,114    1,657,528            3,617,958    3,159,169

Net interest income                                    2,044,962    1,810,251            3,885,441    3,206,903
Provision for loan losses                                 65,032       50,000              200,768       68,000
                                                      ----------   ----------           ----------   ----------
Net interest income after provision for loan losses    1,979,930    1,760,251            3,684,673    3,138,903

Non-interest income:
  Gain on sale of loans                                  394,492      222,637              838,446      402,868
  Service fees and charges                               253,163      274,543              584,553      531,821
  Commissions and other                                   20,552       41,090               60,189       67,464
                                                      ----------   ----------           ----------   ----------
Total non-interest income                                668,207      538,270            1,483,188    1,002,153

Non-interest expense:
  Compensation and related benefits                    1,032,935      906,615            1,982,819    1,732,871
  Occupancy                                              217,929      200,481              432,950      378,710
  Other                                                  610,154      417,401            1,266,744      894,513
                                                      ----------   ----------           ----------   ----------
Total non-interest expense                             1,861,018    1,524,497            3,682,513    3,006,094
                                                      ----------   ----------           ----------   ----------

Income before income tax expense                         787,119      774,024            1,485,349    1,134,962
Income tax expense                                       291,928      292,705              539,579      428,184
                                                      ----------   ----------           ----------   ----------
NET INCOME                                            $  495,191   $  481,319           $  945.770   $  706,778
                                                      ==========   ==========           ==========   ==========

Earnings per share (Note 2):
  Net income per share -basic                         $     0.28   $     0.26           $     0.52   $     0.39
  Net income per share -diluted                       $     0.27   $     0.26           $     0.52   $     0.39
  Weighted average shares outstanding -basic           1,776,211    1,826,981            1,807,564    1,826,021
  Weighted average shares outstanding -diluted         1,802,217    1,826,981            1,820,495    1,826,021

See accompanying notes to consolidated financial statements

                                                                                                              2
</TABLE>
<PAGE>

                        FirstBank Corp. and Subsidiaries,
                      Consolidated Statements of Cash Flows


<TABLE>
<CAPTION>
                                                                                      Six-months ended September 30,
                                                                                          1998             1997
                                                                                      ------------    -------------
                                                                                               (Unaudited)
<S>                                                                                   <C>             <C>
Cash flows from operating activities:
  Net income                                                                          $    945,770    $     706,778
  Adjustments to reconcile net income to net cash provided by operating activities:
    Depreciation                                                                           234,587          322,082
    Provision for loan losses                                                              200,768           68,000
    Gain on sale of loans                                                                 (838,446)        (402,868)
    FHLB stock dividends                                                                   (83,189)         (58,500)
    ESOP compensation expense                                                              144,539           66,641
    Other (gains) losses, net                                                               49,935           10,498
    Provision for real estate owned                                                         20,410                0
    Deferred compensation expense                                                           63,006           31,680
    Deferred income taxes                                                                   (2,416)          (7,980)
 Changes in assets and liabilities:
    Accrued interest receivable and other assets                                          (999,711)        (550,599)
    Accrued expenses and other liabilities                                                (597,528)        (338,321)
    Income taxes receivable (payable)                                                      736,710           23,168
                                                                                      ------------    -------------
Net cash used in operating activities                                                     (125,565)        (129,421)

Cash flows from investing activities:
  Purchase of mortgage-backed securities; available-for-sale                            (2,128,941)      (8,327,422)
  Proceeds from maturities of mortgage-backed securities; held-to-maturity               2,548,505          620,055
  Decrease in loans receivable from loans sold                                          24,984,132       14,884,411
  Other net change in loans receivable                                                 (34,016,113)     (34,776,129)
  Purchase of FHLB stock                                                                  (215,012)      (1,014,700)
  Purchases of premises and equipment                                                     (287,956)        (371,988)
  Proceeds from sale of fixed assets                                                       336,357                0
  Net increase in cash surrender value of life insurance policies                         (148,177)         (14,545)
  Proceeds from sale of real estate owned                                                  728,531          149,113
  Purchase of investment securities; available for sale                                 (2,250,000)      (3,503,000)
  Proceeds from maturities of investment securities; held-to-maturity                      750,000        2,250,000
                                                                                      ------------    -------------
Net cash used in investing activities                                                   (9,698,674)     (30,104,205)

Cash flows from financing activities:
  Proceeds from issuance of common stock                                                         0       17,354,663
  Cash paid for dividends                                                                 (286,907)               0
  Net increase in deposits                                                               8,669,462          904,615
  Bank overdrafts                                                                                0           49,539
  Advances from borrowers for taxes and insurance                                            3,456           74,429
  Advances from FHLB                                                                    48,230,000      149,372,915
  Payments on advances from FHLB                                                       (36,658,473)    (128,155,419)
  Purchase of treasury stock                                                            (2,024,779)               0
                                                                                      ------------    -------------
Net cash provided by financing activities                                               17,932,759       39,600,742
                                                                                      ------------    -------------
Net increase in cash and cash equivalents                                                8,108,520    $   9,367,116

Cash and cash equivalents, beginning of period                                           8,416,820        5,302,736
                                                                                      ------------    -------------
Cash and cash equivalents, end of period                                              $ 16,525,340    $  14,669,852
                                                                                      ============    =============

Supplemental  disclosures  of cash flow  information:  Cash paid  during  the
  period for:
     Interest                                                                         $  2,465,129    $   3,159,867
     Income taxes                                                                     $     18,934    $     218,418
  Noncash investing and financing activities:
     Unrealized (gains) losses on securities; available-for-sale, net of tax          $    (32,321)   $    (117,501)
     Loans receivable charged to the allowance for loan losses                        $     23,459    $      17,775
     Transfer from loans converted to real estate acquired through foreclosure        $    355,901    $     194,749
     Issuance of common stock out of treasury under Management Recognition and
        Development Plan                                                              $  1,254,525                0

See accompanying notes to consolidated financial statements

                                                                                                                  3
</TABLE>
<PAGE>

                        FirstBank Corp. and Subsidiaries
                 Consolidated Statements of Comprehensive Income


<TABLE>
<CAPTION>
                                                        Three-months ended Sept. 30,    Six-months ended Sept. 30,
                                                              1998       1997                1998       1997
                                                            --------   --------            --------   --------
                                                                                (Unaudited)
<S>                                                         <C>        <C>                 <C>        <C>
Net income                                                  $495,191   $481,319            $945,770   $706,778
Other comprehensive income (loss), net of tax:
       Change in unrealized gains (losses) on securities;
             available-for-sale, net of tax                   53,873     76,701              32,321    117,501
                                                            --------   --------            --------   --------

       Net other comprehensive income (loss)                  53,873     76,701              32,321    117,501
                                                            --------   --------            --------   --------
Comprehensive income                                        $549,064   $558,020            $975,714   $756,108
                                                            ========   ========            ========   ========


See accompanying notes to consolidated financial statements


                                                                                                             4
</TABLE>
<PAGE>

                        FIRSTBANK CORP. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(1)  BASIS OF PRESENTATION

The accompanying  unaudited consolidated financial statements have been prepared
in accordance with Generally Accepted  Accounting  Principles (GAAP) for interim
financial information and with the instructions to Form 10-QSB and Article 10 of
Regulation  S-X.  Accordingly,  they do not include all of the  information  and
footnotes required by GAAP for complete financial  statements.  These statements
should be read in conjunction  with the  consolidated  financial  statements and
related notes included in the Company's Form 10-KSB for the year ended March 31,
1998.  In the  opinion of  management,  all  adjustments  (consisting  of normal
recurring adjustments) necessary for a fair presentation have been included. The
results  of  operations  and  other  data for the  three  and six  months  ended
September  30,  1998  are not  necessarily  indicative  of  results  that may be
expected for the entire fiscal year ending March 31, 1999.

The  unaudited  consolidated  financial  statements  of  FirstBank  Corp.  ("the
Company")  include  the  accounts  of  its  wholly-owned  subsidiary,  FirstBank
Northwest  (the  "Savings  Bank")  and  it's  wholly-owned  subsidiary,  TriStar
Financial  Corporation for the  three-months  and six-months ended September 30,
1998.  The  financial  statements  for the periods prior to July 1, 1997 include
only the  accounts  of the  Savings  Bank and its  subsidiary.  All  significant
intercompany accounts and transactions have been eliminated in consolidation.

In September 1998, the Financial  Accounting Standards Board Issued Statement of
Financial  Accounting  Standards  (SFAS) No.  133,  "Accounting  for  Derivative
Instruments  and  Hedging  Activities."  SFAS  No.  133  requires  companies  to
recognize  all  derivatives  contracts as either  assets or  liabilities  in the
balance sheet and to measure them at fair value. If certain  conditions are met,
a derivative may be specifically  designated as a hedge,  the objective of which
is to match the timing of gain or loss  recognition  on the  hedging  derivative
with the  recognition  of (i) the changes in the fair value of the hedged assets
or  liability  that are  attributable  to the hedged  risk or (ii) the  earnings
effect of the hedged forecasted transaction.  For a derivative not designated as
a hedging instrument,  the gain or loss is recognized in income in the period of
change.  SFAS No. 133 is  effective  for all  fiscal  quarters  of fiscal  years
beginning  after September 15, 1999.  Historically,  the Company has not entered
into  derivative  contracts  either to hedge existing  risks or for  speculative
purposes.  Accordingly, the Company does not expect adoption of the new standard
on April 1, 2000 to affect its financial statements.

(2)  EARNINGS PER SHARE

Basic earnings per share is computed by dividing the Company's net income by the
weighted average number of common shares outstanding during the period.  Diluted
earnings  per  share  reflects  the  potential  dilution  that  could  occur  if
securities or other  contracts to issue common stock were exercised or converted
into common stock.  ESOP shares,  which are unallocated and not yet committed to
be  released,   are  excluded  from  the  weighted  average  shares  outstanding
calculation

(3)  EMPLOYEE STOCK OWNERSHIP PLAN ("ESOP")

During 1997 the Company established a tax-qualified  internally  leveraged ESOP.
The ESOP covers  substantially all employees who have attained the age of 21 and
completed  one year of service.  In  connection  with the  conversion to a stock
company,  the ESOP purchased  158,700 shares of the Company's  common stock at a
price of $10.00 per share using funds loaned by the Company. All ESOP shares are
held in a suspense  account and are allocated  among the  participants  on a pro
rata basis as the loan is repaid.  Currently  this  receivable  from the ESOP is
scheduled to be repaid with level principal and interest  payments over 25 years
with no penalty for prepayment.  Shares  released from the suspense  account are
allocated among the participants based upon their pro rata annual compensation.

The sale of the shares to the ESOP was recorded by the Company as unearned  ESOP
shares, a contra equity account.  As ESOP shares are committed to be released to
compensate  employees,  the contra equity account is reduced and a corresponding
charge to  compensation  expense  equal to the fair  market  value of the shares
committed  to be  released  is  recorded.  Upon  committing  these  share  to be
released,   they  become   outstanding   for   purposes  of   earnings-per-share
computations.  Dividends on allocated ESOP shares are recorded as a reduction of
retained  earnings;  dividends  on  unallocated  ESOP  shares are  recorded as a
reduction in ESOP debt.  Compensation  expense  related to the ESOP was $145,000
for the  six-months  ended  September 30, 1998.  As of September  30, 1998,  the
Company has  allocated or committed to release to the ESOP 15,528  earned shares
and has 143,172 unearned,  restricted shares remaining to be release. The market
value of unearned,  restricted  shares held by the ESOP trust was  approximately
$2.5 million at September 30, 1998.

                                                                               5
<PAGE>

(4) DIVIDEND

On July 23,  1998 the Board of  Directors  declared a cash  dividend of $.08 per
common share to  shareholders  of record as of August 20, 1998. The dividend was
paid on September 3, 1998.

On October 19, 1998 the Board of Directors  declared a cash dividend of $.09 per
common share to  shareholders  of record as of November  11, 1998.  The dividend
will be paid November 25, 1998.

Item 2               MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-looking statements,  within the meaning of Section 21E of the Securities
and Exchange Act of 1934, are made throughout this  Management's  Discussion and
Analysis of Financial Condition and Results of Operations. For this purpose, any
statements  contained  herein that are not statements of historical  fact may be
deemed to be  forward-looking  statements.  Without limiting the foregoing,  the
words "believes",  "anticipates",  "plans",  "expects",  "estimates" and similar
expressions  are intended to identify  forward-looking  statements.  There are a
number of  important  factors  that could  cause the  results of the  Company to
differ  materially from those indicated herein.  These factors include,  but are
not limited to, those set forth in Item 7 entitled  Management's  Discussion and
Analysis of Financial  Condition and Results of Operations in the Company's Form
10-KSB for the year ended March 31, 1998.

GENERAL

On July 1, 1997,  FirstBank  Northwest  converted  from mutual to stock form and
became a wholly owned  subsidiary of a newly formed  Delaware  holding  company,
FirstBank Corp. The Company sold 1,983,750  shares of common stock at $10.00 per
share in conjunction with a subscription offering to the Savings Bank's Employee
Stock Ownership Plan (ESOP) and eligible account holders.  The net proceeds were
approximately $18,921,825.  The company used approximately $9,470,000 of the net
proceeds to purchase  all the capital  stock of the Savings  Bank.  In addition,
$1,587,000  was loaned to the ESOP for the  purchase  of  158,700  shares in the
offering.

The Company's principal business is the business of the Savings Bank. Therefore,
the  discussion  in  the  Management's  Discussion  and  Analysis  of  Financial
Conditions  and  Results  of  Operation  relates  to the  Savings  Bank  and its
operations.  In August 1997,  the Bank opened up a retail  branch in  Clarkston,
Washington.  The Bank now has offices in Idaho and  Washington.  In January 1998
the Bank changed its charter to a Washington state charter.

During the 2nd  quarter,  the  shareholders  approved the  Company's  Management
Recognition  and  Development  Plan and 1998  Stock  Option  Plan.  The Board of
Directors  awarded  79,350  shares of  restricted  stock and  options to acquire
171,350 shares.

In August 1998 the Company  completed the  repurchase  of 5%, or 99,187,  of its
common shares.  In September  1998,  79,350 of these shares were reissued out of
treasury under the Management  Recognition and Development Plan. The Company has
also  announced  plans to  repurchase an additional 4% of its shares on the open
market.

During the quarter  ended  September  31,  1998,  the  Company  launched a pilot
program  for its  Online  Homebanking.  Effective  on  October  1, 1998 this new
service was offered to customers.  With this system,  customers can access their
accounts by screen phones, personal computers, touch-tone telephones and through
internet access.

On September 21st, the Company received FDIC approval to begin construction of a
new branch office in Liberty Lake,  Washington.  Liberty Lake is a  fast-growing
bedroom community midway between Spokane,  Washington and Coeur d' Alene, Idaho.
This will be the seventh retail branch for the Company, the second in Washington
State. It is expected the branch will open during the summer of 1999.

FINANCIAL CONDITION AT SEPTEMBER 30, 1998 AND MARCH 31, 1998

Assets  increased  from $183.6  million at March 31,  1998 to $202.4  million at
September 30, 1998.  Cash and cash  equivalents  increased  from $8.4 million at
March 31, 1998 to $16.5 million at September 30, 1998 as a result of an increase
in deposits. Loans receivable increased from $145.7 million at March 31, 1998 to
$155.0  million  at  September  30,  1998 as a  result  of a large  increase  in
commercial lending.  Accrued interest receivable increased $1.4 million at March
31, 1998 to $2.1 million at  September  30, 1998 due to a higher  average  asset
base in securities  and loans.  Deposits  increased from $114.5 million at March
31, 1998 to $123.2  million at  September  30,  1998.  Activity  within  deposit
balances  increased  primarily  due to the Savings  Bank  benefiting  from funds
deposited by the customers of other local  institutions,  following  larger bank
mergers,  and from deposits of new commercial loan customers.

                                                                               6
<PAGE>

Federal Home Loan Bank of Seattle (FHLB)  advances  increased from $35.7 million
at March 31, 1998 to $47.2 million at September  30, 1998.  The increase in FHLB
borrowing was used to fund loan growth.  Accrued expenses and other  liabilities
decreased  from $1.8 million at March 31, 1998 to $1.3 million at September  30,
1998. The primary  reason for the decrease was timing of investor  mortgage loan
payoffs.  It is the policy of the  Savings  Bank to cease  accruing  interest on
loans 90 days or more past due.  Nonaccrual  loans  decreased  from  $454,000 at
March 31, 1998 to $19,000 at September 30, 1998.

RESULTS OF OPERATIONS FOR THREE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997

Net income increased from $481,000 for the three months ended September 30, 1997
to $495,000 for the three months ended September 30, 1998.

Net  interest  income  increased  from $1.8  million for the three  months ended
September  30, 1997 to $2.0  million for the three months  ended  September  30,
1998.  Total  interest  income  increased from $3.5 million for the three months
ended  September  30, 1997 to $3.9 million for three months ended  September 30,
1998.  The  increase  in  interest  income  stemmed  from an increase in average
interest  earning assets offset  slightly by a decrease in the weighted  average
yield  on the loan  portfolio,  which  was  8.97%  for the  three  months  ended
September 30, 1997  compared to the weighted  average yield for the three months
ended September 30, 1998 of 8.92%.  The average balance of loans  receivable was
$104.4  million in the 2nd  quarter of 1997  compared  to the 2nd  quarter  1998
average  balance of $155.5 million.  Interest income from investment  securities
decreased from $112,000 for the three months ended September 30, 1997 to $71,000
for the three months ended  September 30, 1998. The decrease is primarily due to
a decrease in average yield.  Interest  income from  mortgage-backed  securities
increased  from  $123,000  for the three  months  ended  September  30,  1997 to
$162,000  for the three  months ended  September  30, 1998.  The increase is due
primarily to a higher  average  balance.  Interest  expense  increased from $1.7
million for the three  months ended  September  30, 1997 to $1.9 million for the
same time period in 1998.  The increase in interest  expense is due primarily to
higher  average  deposit  balances,  an increase in average FHLB  advances and a
decrease in weighted  average rates.  The weighted  average rate on deposits for
the three  months  ended  September  30, 1998 was 4.15%,  whereas  the  weighted
average  rate on  deposits as of  September  30,  1997 was 4.26%.  The  weighted
average rate on FHLB advances for the three months ended  September 30, 1998 was
5.79%,  whereas the weighted  average rate on FHLB  advances as of September 30,
1997 was 7.07%.

Provision for loan losses is based upon  management's  consideration of economic
conditions  which may  affect  the  ability  of  borrowers  to repay the  loans.
Management also reviews  individual loans for which full  collectibility may not
be reasonably assured and considers,  among other matters, the risks inherent in
the Savings  Bank's  portfolio  and the estimated  fair value of the  underlying
collateral.  This evaluation is ongoing and results in variations in the Savings
Bank's provision for loan losses.  As a result of this  evaluation,  the Savings
Bank's  provision  for loan losses  increased  from $50,000 for the three months
ended  September  30, 1997 to $65,000 for the three months ended  September  30,
1998.

Non-interest income increased from $538,000 for the three months ended September
30, 1997 to $668,000 for the three months ended  September 30, 1998. The primary
reason for the increase is the gain on sale of loans, which increased $172,000.

Non-interest  expense  increased  from $1.5  million for the three  months ended
September  30, 1997 to $1.9  million for the three months  ended  September  30,
1998.  The increase in  compensation  and other related  expenses of $126,000 is
because of the expanded commercial and agriculture  departments.  Other expenses
that were up are advertising, data processing and costs associated with becoming
a public company.

Income  taxes  decreased  from an expense of $293,000 for the three months ended
September 30, 1997 to expense of $292,000 for the same time period in 1998.

RESULTS OF OPERATIONS FOR SIX MONTHS ENDED SEPTEMBER 30, 1998 AND 1997

Net income  increased from $707,000 for the six months ended  September 30, 1997
to $946,000 for the six months ended September 30, 1998.

Net  interest  income  increased  from $2.3  million  for the six  months  ended
September 30, 1997 to $2.5 million for the six months ended  September 30, 1998.
Total  interest  income  increased  from $6.4  million for the six months  ended
September 30, 1997 to $7.5 million for six months ended  September 30, 1998. The
increase in interest income stemmed from an increase in average interest earning
assets offset  slightly by a decrease in the weighted  average yield on the loan
portfolio,  which was 8.94% for the six months ended September 30, 1997 compared
to the weighted  average  yield for the six months ended  September  30, 1998 of
8.73%.  The  increase  in interest  earning  assets was due in large part to the
completion of the Savings Bank's mutual to stock conversion in the middle of the
1997

                                                                               7
<PAGE>
period.  The average  balance for loans  receivable was $125.0 million in during
the  six-months  ended  September  30,  1997  compared to the  six-months  ended
September  30, 1998  average  balance of $152.4  million.  Interest  income from
investment securities decreased from $184,000 for the six months ended September
30, 1997 to $139,000 for the six months ended  September 30, 1998.  The decrease
is primarily due to a decrease in average yield from 5.86% at September 30, 1997
to 5.08% at September 30, 1998 . Interest income from mortgage-backed securities
increased from $220,000 for the six months ended  September 30, 1997 to $330,000
for the six months ended  September 30, 1998. The increase is due primarily to a
higher average balance. Interest expense increased from $3.2 million for the six
months  ended  September  30,  1997 to $3.6  million for the same time period in
1998.  The  increase  in interest  expense is due  primarily  to higher  average
deposit  balances,  an  increase  in average  FHLB  advances  and a decrease  in
weighted average rates. The weighted average rate on deposits for the six months
ended  September  30,  1998 was 4.17%,  whereas  the  weighted  average  rate on
deposits for the  six-months  ended  September 30, 1997 was 4.28%.  The weighted
average rate on FHLB  advances for the six months ended  September  30, 1998 was
5.74%,  whereas the weighted  average rate on FHLB  advances for the  six-months
ended September 30, 1997 was 6.60%.

Provision for loan losses is based upon  management's  consideration of economic
conditions  which may  affect  the  ability  of  borrowers  to repay the  loans.
Management also reviews  individual loans for which full  collectibility may not
be reasonably assured and considers,  among other matters, the risks inherent in
the Savings  Bank's  portfolio  and the estimated  fair value of the  underlying
collateral.  This evaluation is ongoing and results in variations in the Savings
Bank's provision for loan losses.  As a result of this  evaluation,  the Savings
Bank's provision for loan losses increased from $68,000 for the six months ended
September 30, 1997 to $201,000 for the six months ended September 30, 1998.

Non-interest  income  increased  from  $1.0  million  for the six  months  ended
September 30, 1997 to $1.5 million for the six months ended  September 30, 1998.
The  primary  reason  for the  increase  is the gain on sale of loans  increased
$436,000.

Non-interest  expense  increased  from $3.0  million  for the six  months  ended
September 30, 1997 to $3.7 million for the six months ended  September 30, 1998.
The increase in compensation  and other related  expenses of $250,000 is because
of the expanded commercial and agriculture departments. Other expenses that were
up are advertising,  data processing and costs associated with becoming a public
company.

Income  taxes  increased  from an expense of $428,000  for the six months  ended
September 30, 1997 to expense of $540,000 for the same time period in 1998.

LIQUIDITY AND CAPITAL RESOURCES

         The Company's primary recurring sources of funds are customer deposits,
proceeds from principal and interest  payments on loans,  proceeds from sales of
loans,  maturing  securities and FHLB advances.  While  maturities and scheduled
amortization  of loans are a  predictable  source of  funds,  deposit  flows and
mortgage prepayments are greatly influenced by general interest rates,  economic
conditions and competition.

         The Company must maintain an adequate  level of liquidity to ensure the
availability of sufficient funds to support loan growth and deposit withdrawals,
to  satisfy   financial   commitments   and  to  take  advantage  of  investment
opportunities.  The Company generally  maintains  sufficient cash and short-term
investments to meet short-term  liquidity needs. At September 30, 1998, cash and
cash equivalents  totaled $16.5 million,  or 8.17% of total assets. In addition,
the Company  maintains a credit facility with the  FHLB-Seattle,  which provides
for immediately available advances.  Advances under this credit facility totaled
$47.2 million at September 30, 1998.

         The primary  investing  activity of the Company is the  origination  of
loans.  During the  quarters  ended  September  30,  1997 and 1998,  the Company
originated loans in the amounts of $64.7 million and $84.0 million respectively.
At September 30, 1998, the Company had loan commitments  totaling $29.3 million,
undisbursed  lines of credit  totaling $7.2 million,  and  undisbursed  loans in
process  totaling  $12.5  million.  The  Company  anticipates  that it will have
sufficient  funds  available to meet its current loan  origination  commitments.
Certificates  of deposit that are scheduled to mature in less than one year from
September 30, 1998 totaled  $48.5  million.  Historically,  the Company has been
able to retain a significant amount of its deposits as they mature. In addition,
management  of the Company  believes  that it can adjust the  offering  rates of
savings certificates to retain deposits in changing interest rate environments.

         The Bank is required to maintain  specific  amounts of capital pursuant
to the FDIC and the State of Washington requirements.  As of September 30, 1998,
the Bank was in compliance with all regulatory  capital  requirements which were
effective as of such date with Tier 1 Capital to average assets,  Tier 1 Capital
to  risk-weighted  assets and Total capital to  risk-weighted  assets of 10.91%,
14.96% and 14.98%, respectively.

                                                                               8
<PAGE>
YEAR 2000 ISSUES

         The  Year  2000  issue  exists   because  many  computer   systems  and
applications  use two-digit date fields to designate a year. As the century date
change  occurs,  date-sensitive  systems may recognize the year 2000 as 1900, or
not at all.  This  inability to  recognize  or properly  treat the year 2000 may
cause systems to process financial and operational information  incorrectly.  In
order to alleviate the potential for systems  failure or erroneous  information,
the Company has created a Year 2000 compliance plan that focuses on identifying,
testing and  implementing  solutions  for Year 2000  processing.  A  preliminary
estimate  of the  total  cost to  complete  the  Year  2000  compliance  plan is
approximately  $100,000,  $60,000 of which has been spent on the project year to
date. Maintenance or modification costs will be expensed as incurred,  while the
costs of new software  will be  capitalized  and amortized  over the  software's
useful life.  The costs for  accomplishing  the Company's  plans to complete the
year 2000  modifications  and testing  processes are based on management's  best
estimates,  which were derived utilizing  numerous  assumption of future events,
including  the  continued   availability  of  various   resources,   third-party
modification  plans and other factors.  However,  there can be no guarantee that
these  estimates  will be achieved,  and actual  results could differ from those
plans.  In the event that the Company's  service bureau is unable to fulfill its
contractual  obligations  to the Company,  it could have a  significant  adverse
impact on the financial condition and results of operations of the Company.

At June  30,  1998,  the  Company  had  completed  the  awareness  training  and
assessment phases of its Year 2000 compliance plan and was well into the testing
phase. The awareness phase included gaining  understanding  and support with the
help of an independent  consulting  firm  experienced  in Year 2000  management,
committing  resources  to the plan,  established  a project team  consisting  of
senior managers and department  heads,  and developing a strategy to address all
internal and external systems.  The project team reports monthly to the Board of
Directors as to the status of timeline for competing the project.

The  assessment  phase  involved  attempting  to identify all critical  business
processes  and  determining  the  impact  of Year 2000 on all  computer  systems
throughout  the  organization.  Vendors  were  contacted  and  asked  to  submit
certification  letters  stating  that  they are in  compliance  with  Year  2000
conversion issues.

As of  September  30, 1998 the Company  had  successfully  tested with the major
service  provider.  All hardware  and  computer  systems and all of the embedded
systems contained in the building,  equipment and other infrastructure have been
assessed.  The Company has  successfully  tested the loan platforms  systems for
loan documentation.  It is estimated that testing programming changes (including
converting,  replacing or  eliminating  all software and databases as necessary)
will be largely completed by March 31, 1999.

Contingency  plans are being  developed  in the  event  modifications  cannot be
completed in time, or in the event  unforeseen  problems develop in spite of the
Company's efforts to ensure compliance with Year 2000 standards.

Financial  institutions  also must  consider  the  possibility  of some level of
reduction in deposits  during the month of December  1999.  The Company has made
arrangements  with the  Federal  Reserve for funds from the  discount  window if
needed.

In  conjunction  with its  review  of Year  2000  issues,  the  Company  also is
assessing the impact of the Year 2000 problem on significant borrowers and their
ability to repay  loans.  As of September  30,  1998,  a credit risk  mitigation
assessment  on  loans  was   completed,   resulting  in  the  evaluation  of  an
insignificant number of loans with a high or medium risk factor.

                                                                               9
<PAGE>

                        FIRSTBANK CORP. AND SUBSIDIARIES

PART II  -  OTHER INFORMATION

Item 1 - Legal Proceeding

     There are no material legal proceedings to which the Company or the Savings
     Bank is a party or of which any of their property is subject.  From time to
     time, the Savings Bank is a party to various legal proceedings  incident to
     its business.

Item 2 - Changes in Securities

     None.

Item 3 - Defaults upon Senior Securities

     Not applicable.

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

     The Annual Meeting of Stockholders  of the Company  ("Meeting") was held on
July 22, 1998.  The results of the vote on the matters  presented at the Meeting
is as follows:

         1. The  following  individuals  were elected as  directors,  each for a
            three-year term:

                                       Voted For         Vote Withheld
            Larry K. Moxley            1,788,972            28,151
            William J. Larson          1,776,130            40,993

            The terms of  Directors  Steve R. Cox,  James N.  Marker,  Robert S.
            Coleman,  Sr., W. Dean Jurgens, and Clyde E. Conklin continued after
            the meeting.

         2. The  FirstBank   Corp.  1998  Stock  Option  Plan  was  approved  by
            stockholders by the following vote:

                 For 1,133,306; Against 229,200; Abstain 11,655

         3. The FirstBank Corp. Management  Recognition and Development Plan was
            approved by stockholders by the following vote:

                 For 1,109,566; Against 256,975; Abstain 7,620

Item 5 - Other Information

     None.

Item 6 - Exhibits and Reports on Form 8-K

     (a) Exhibits:  none
     (b) Reports on Form 8-K; No reports on Form 8-K have been filed  during the
         quarter for which this report is filed.


                                                                              10
<PAGE>

                                   SIGNATURES

Pursuant  to the  requirements  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.


                                  FIRSTBANK CORP.


DATED:  October 31, 1998          BY: /s/ CLYDE E. CONKLIN
                                     ------------------------------------------
                                          Clyde E. Conklin
                                          President and Chief Executive Officer

                                  BY: /s/ LARRY K. MOXLEY
                                     ------------------------------------------
                                          Larry K. Moxley
                                          Secretary and Chief Financial Officer


                                                                              11