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 June 30, 1997.

[] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
 SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION
 PERIOD FROM                         TO
                      .

Commission file number     0-22471


              Luxemburg Bancshares, Inc.
 (Exact name of small business issuer as specified in
                     its charter)
                           
                           
       Wisconsin                               39-1457904
    (State or other                         (I.R.S. Employer
    jurisdiction of                        Identification No.)
    incorporation or
      organization
                                                    
    630 Main Street,                              54217
  Luxemburg, Wisconsin
 (Address of principal                         (Zip Code)
   executive offices)
                                                    
                         (920) 845-2345
                   (Issuer's Telephone Number)
                                
                                
                               N/A
                                
 (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.    Yes            No     [X]


State the number of shares outstanding of each of the
issuer's classes of common equity, as of the latest
practicable date.   As of July 31, 1997, 243,051 shares
of Common Stock were outstanding.


Transitional Small Business Disclosure Format
(Check one):
Yes            No   [X]


<PAGE>

              LUXEMBURG BANCSHARES, INC.
                           
                         INDEX



                                                   Page No.
PART I - FINANCIAL INFORMATION                    
                                                  
Consolidated Balance Sheets - June 30, 1997 and   
December 31, 1996
                                                  
Consolidated Statements of Income- Six and Three  
Months Ended
June 30, 1997 and 1996
                                                  
Consolidated Statements of Cash Flow -Six Months  
Ended
June 30, 1997 and 1996
                                                  
Notes to Consolidated Financial Statements        
                                                  
Management's Discussion and Analysis of Financial 
Condition
and Results of Operations
                                                  
PART II - OTHER INFORMATION                       
                                                  
Item 6 - Exhibits and Reports on Form 8-K         
                                                  
SIGNATURES                                        

<PAGE>

            PART I - FINANCIAL INFORMATION
              LUXEMBURG BANCSHARES, INC.
                   AND SUBSIDIARIES
              CONSOLIDATED BALANCE SHEETS
                      (UNAUDITED)
         June 30, 1997 and December 31,  1996

                        ASSETS

                                                      
                                        1997        1996
Cash and due from banks         
                                      $3,071,658  $2,858,813
Interest-bearing deposits                180,027     407,688
Federal funds sold                                          
                                             -0-     466,000
                                                            
     Cash and cash equivalents         3,251,685   3,732,501
                                                            
Investment securities available for   14,404,353  14,064,569
sale-Stated at fair value
                                                            
Total loans                           58,979,577  55,170,942
     Allowance for credit losses                            
                                       (701,947)   (653,535)
                                                            
Net loans                             58,277,630  54,517,407
Premises and equipment                 1,772,299   1,380,788
Other investments at cost                253,050     251,650
Other assets                                                
                                       2,146,541   1,953,724
                                                            
TOTAL ASSETS                         $80,105,558 $75,900,639
                                                            

         LIABILITIES AND STOCKHOLDERS' EQUITY

                                                      
                                        1997        1996
LIABILITIES:                                     
                                                 
Non-interest-bearing deposits         $8,572,109  $7,004,277
Interest-bearing deposits                                   
                                      60,548,329  59,153,184
                                                            
Total deposits                        69,120,438  66,157,461
                                                            
Short-term borrowings                  1,067,275     880,076
Borrowed funds                           728,212     185,558
Other liabilities                                           
                                       1,167,800     997,528
                                                            
     Total liabilities                                      
                                      72,083,725  68,220,623
                                                            
STOCKHOLDERS' EQUITY:                                       
                                                            
Common stock- $.1667 par value:                             
     Authorized - 300,000 shares,         45,083      45,083
Issued - 270,500 shares
Capital surplus                        3,422,141   3,416,080
Retained earnings                      4,899,874   4,579,875
Unrealized gain (loss) on investment                        
securities available                       4,825     (6,913)
   for sale - Net of tax
Less - 27,449 shares and 27,764                             
shares, respectively,                  (350,090)   (354,109)
  of treasury common stock, at cost
                                                            
     Total stockholders' equity                             
                                       8,021,833   7,680,016
                                                            
TOTAL LIABILITIES AND STOCKHOLDERS'         
EQUITY                               $80,105,558 $75,900,639

   See accompanying notes to consolidated financial
                      statements.

<PAGE>

              LUXEMBURG BANCSHARES, INC.
                   AND SUBSIDIARIES
                           
           CONSOLIDATED STATEMENTS OF INCOME
                      (UNAUDITED)
                           
                              Six Months Ended June    Three Months Ended
                                       30,                  June 30,
                                                                       
                                  1997       1996        1997        1996
INTEREST INCOME:                                                             
                                                                             
Interest and fees on loans           
                               $2,540,032  $2,261,969  $1,302,161  $1,153,708
Interest on investment                                                       
securities:
     Taxable                      354,178     380,301     182,773     184,960
     Tax-exempt                    59,822      16,668      30,292      11,230
Other interest and dividend                                                  
income                             24,563      99,433      10,217      31,127
                                                                             
     Total interest income                                                   
                                2,978,595   2,758,371   1,525,443   1,381,025
                                                                             
INTEREST EXPENSE:                                                            
                                                                             
Deposits                        1,384,797   1,365,726     706,327     669,402
Short-term borrowings              26,961       6,521      18,383       2,526
Borrowed funds                                                               
                                   13,521       8,012       8,395       3,920
                                                                             
     Total interest expense                                                  
                                1,425,279   1,380,259     733,105     675,848
                                                                             
Net interest income             1,553,316   1,378,112     792,338     705,177
Provision for credit losses                                                  
                                   60,000      36,500      30,000      18,000
                                                                  
Net interest income after                                                    
provision for credit losses     1,493,316   1,341,612     762,338     687,177
                                                                             
OTHER INCOME:                                                                
                                                                             
Service charges on deposit         92,370      87,286      46,971      46,738
accounts
Mortgage underwriting fees -       40,572      28,670      29,014       8,323
Secondary market
Loan servicing fee income          21,273      21,622       7,348      11,569
Other operating income                                                       
                                  262,187     232,450     131,836     131,870
                                                                             
     Total other income                                                      
                                  416,402     370,028     215,169     198,500
                                                                             
OPERATING EXPENSES:                                                          
                                                                             
Salaries and related benefits     717,335     645,860     372,698     333,310
Net occupancy expense              84,611      83,368      41,071      41,378
Equipment rentals,                 96,481      88,179      53,196      43,427
depreciation, and maintenance
Data processing                   129,217      89,426      84,096      46,512
Other operating expenses                                                     
                                  292,079     268,552     164,476     141,380
                                                                             
     Total operating expenses                                                
                                1,319,723   1,175,385     715,537     606,007
                                                                             
Income before provision for       589,995     536,255     261,970     279,670
income taxes
Provision for income taxes                                                   
                                  172,775     186,413      73,260      99,459
                                                                             
Net income                       $417,220    $349,842    $188,710    $180,211
                                                                             
Earnings per common share           $1.72       $1.44       $0.78       $0.74

   See accompanying notes to consolidated financial
                      statements.

<PAGE>

              LUXEMBURG BANCSHARES, INC.
                   AND SUBSIDIARIES
                           
         CONSOLIDATED STATEMENTS OF CASH FLOW
                      (UNAUDITED)
        Six Months Ended June 30, 1997 and 1996

                                                      
                                        1997        1996
CASH FLOWS FROM OPERATING                                   
ACTIVITIES:
                                                            
Net income                              $417,220    $349,842
Adjustments to reconcile net income                         
to net cash
  provided by operating activities:                         
    Depreciation                          83,801      81,677
    Accretion of discounts on           (21,812)    (37,162)
securities
    Amortization of premiums on           17,686      32,792
securities
    Provision for credit losses           60,000      36,500
    Employee stock bonus                  10,080      10.730
    Provision for deferred taxes        (31,222)            
    Change in other operating assets   (117,256)    (75,041)
    Change in other operating                               
liabilities                              170,272    (20,429)
                                                            
      Total adjustments                                     
                                         171,549      29,067
                                                            
Net cash provided by operating                              
activities                               588,769     378,909
                                                            
CASH FLOWS FROM INVESTING                                   
ACTIVITIES:
    Proceeds from maturities of        3,800,164   4,310,817
securities available for sale
    Purchase of securities available (4,117,287)  (4,030,870)
for sale                                    
    Net increase in loans            (3,854,060)  (2,060,346)
                                           
    Purchase of additional life         (17,300)    (17,300)
insurance
    Capital expenditures               (401,381)   (222,524)
    Purchase of other investments                           
                                         (1,400)    (46,400)
                                                            
Net cash used in investing            (4,591,264) (2,066,623)            
activities                                   
                                                           
                                                            
CASH FLOWS FROM FINANCING                                   
ACTIVITIES:
    Net increase (decrease) in         2,962,977  (2,502,466)
deposits                                                 
    Net increase (decrease) in short-    187,199    (13,922)
term borrowings
    Loan from FHLMC                      500,000            
    Principal payments on borrowed      (31,277)    (33,327)
funds
    Dividends paid                                          
                                        (97,220)    (87,384)
                                                            
Net cash provided by (used in)         3,521,679 (2,637,099)
financing activities                
                                                            
Net decrease in cash and cash          (480,816)  (4,324,813)
equivalents                                                
Cash and cash equivalents at                                
beginning                              3,732,501   9,054,643
                                                            
Cash and cash equivalents at end      $3,251,685  $4,729,830
                                                            
Supplemental information:                                   
                                                            
Cash paid during the period for:                            
    Interest                          $1,259,676  $1,273,276
    Income taxes                        $187,968    $188,871

The Bank purchased the assets of Total Financial
concepts, Inc. in 1996 for $135,800. In conjunction
with the acquisition, the Bank incurred debt of
$128,800.
The Company entered into capital leases of $73,931 in
1997 for the purchase of computer equipment.

   See accompanying notes to consolidated financial
                      statements.

<PAGE>

      LUXEMBURG BANCSHARES, INC. AND SUBSIDIARIES
      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      (UNAUDITED)
                           
The consolidated financial statements for interim
periods are unaudited; however, in the opinion of the
management of Luxemburg Bancshares, Inc. ("Company"),
all adjustments (consisting of only normal recurring
adjustments) necessary for a fair presentation have
been included. Refer to the Notes to Consolidated
Financial Statements which appear in the Company's Form
10-SB for the Company's accounting policies which are
pertinent to these financial statements.

NOTE 1: BASIS OF PRESENTATION
The consolidated financial statements of Company, a
bank holding company, include the accounts of Company
and Subsidiaries - Bank of Luxemburg, Luxemburg
Investment Corporation, and Area Development
Corporation. All significant intercompany balances and
transactions have been eliminated in consolidation.
Goodwill acquired in a business acquisition is being
amortized on a straight-line basis over five years.

The accompanying financial statements have been
prepared in accordance with the instructions for Form
10-Q and, therefore, do not include all information and
footnotes necessary to be in conformity with generally
accepted accounting principles.

The Consolidated Statements of Cash Flows has been
presented utilizing the indirect method. For purposes
of reporting cash flows, the Company considers cash on
hand, interest-bearing and non-interest bearing
deposits in banks and federal funds sold as cash and
cash equivalents.

Earnings per common share are based upon the weighted
average number of common shares outstanding.  The
weighted average number of shares outstanding was
243,051 in 1997 and 242,736 in 1996.

NOTE 2: FINANCIAL INSTRUMENTS WITH OFF-BALANCE  SHEET
RISK
The Bank of Luxemburg's ("Bank's") financial statements
do not reflect various commitments and contingent
liabilities which arise in the normal course of
business and which involve elements of credit risk,
interest rate risk, and liquidity risk.  These
commitments and contingent liabilities are commitments
to extend credit and standby letters of credit.  A
summary of the Bank's commitments and contingent
liabilities at each balance sheet date is as follows:

Notional Amount
                                  June 30,    December 31,
                                    1997          1996
                                             
Commitments to extend credit      $5,055,000      $4,676,000
Credit card arrangements             616,000         865,000
Standby letters of credit            110,000          84,000

Commitments to extend credit and credit card
arrangements are agreements to lend to a customer as
long as there is no violation of any condition
established in the contract.  Commitments 

<PAGE>

generally
have fixed expiration dates or other termination
clauses and may require payment of a fee. A portion of
the commitments are expected to be drawn upon, thus
representing future cash requirements. The Bank
evaluates each customer's creditworthiness on a case-by-
case basis.  The amount of collateral obtained upon
extension of credit is based on management's credit
evaluation of the counterparty.  Collateral held varies
but may include accounts receivable; inventory;
property, plant, and equipment; real estate; and stocks
and bonds. Management does not anticipate any material
losses as a result of these commitments.

Standby letters of credit are conditional commitments
issued by the Bank to guarantee the performance of a
customer to a third party.  The credit risk involved in
issuing letters of credit is essentially the same as
that involved in extending loan facilities to
customers.  The Bank holds collateral supporting those
commitments for which collateral is deemed necessary.
Because these instruments have fixed maturity dates and
because many of them expire without being drawn upon,
they do not generally present any significant liquidity
risk to the Bank. Management does not anticipate any
material losses as a result of these letters of credit.

NOTE 3: ACCOUNTING CHANGES
The Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No.
122, "Accounting for Mortgage Servicing Rights," in May
1995.  As required under the statement, the Company
adopted the provisions of the new standard effective
September 1, 1996.  SFAS No. 122 requires accounting
recognition of the rights to service mortgage loans for
others.  In accordance with SFAS No. 122, prior-period
consolidated financial statements have not been
restated to reflect the change in accounting principle.

The FASB issued SFAS No. 125, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishments
of Liabilities," in June 1996.  SFAS No. 125 provides
accounting and reporting standards for transfers and
servicing of financial assets and extinguishments of
liabilities.  The statement provides guidelines for
classification of a transfer as a sale.  The statement
also requires liabilities incurred or obtained by
transferors as part of a transfer of financial assets
be initially recorded at fair value.  Subsequent to
acquisition, the servicing assets and liabilities are
to be amortized over the estimated net servicing
period.  This statement is required to be adopted for
transfers and servicing of financial assets and
extinguishments of liabilities occurring after December
31, 1996.

In December 1996, the FASB issued SFAS No. 127,
"Deferral of the Effective Date of Certain Provisions
of FASB Statement No. 125."  This statement defers
implementation of certain provisions of SFAS No. 125
for one year.

In February 1997 the FASB issued SFAS No. 128,
"Earnings per Share," which is effective for financial
statements issued for periods ending after December 15,
1997. This statement simplifies the standards for
computing earnings per share ("EPS") previously found
in APB No. 15. It replaces the presentation of primary
EPS with a presentation of basic EPS. It also requires
dual presentation of basic and diluted EPS on the face
of the income statement for all entities with complex
capital structures and requires a reconciliation of the
numerator and denominator of the basic EPS computation
to the numerator and denominator of the diluted EPS
computation. 

<PAGE>

Earlier application of this statement is
not permitted. The Company does not have a complex
capital structure and has determined that the impact of
adoption will not have a material effect on the
consolidated financial statements of the Company.

The FASB issued SFAS No. 130, "Reporting Comprehensive
Income", in June 1997. This statement amends FASB No.
52, "Foreign Currency Translation", FASB No. 80,
"Accounting for Futures Contracts", FASB No. 87,
"Employers' Accounting for Pensions" and FASB No. 115,
"Accounting for Certain Investments in Debt and Equity
Securities". This statement is effective for fiscal
years beginning after December 15, 1997. Restatement of
financial statements for earlier periods provided for
comparative purposes is required. Earlier application
is permitted. Under SFAS No. 130 the Company will be
required to report unrealized gains (losses) on
investment securities available for sale as a component
of comprehensive income. Reported Comprehensive Income
would have been as follows for each reported period:

                                Reported Net  Comprehensive
       Reporting Period            Income         Income
                                              
Six Months Ended June 30, 1997       $417,220       $428,959
Six Months Ended June 30, 1996       $349,842       $268,722
                                                            
Three Months Ended June 30,          $188,710       $239,765
1997
Three Months Ended June 30,          $180,211       $144,862
1996
                                                            

In June 1997 the FASB issued SFAS No. 131, "Disclosures
about Segments of an Enterprise and related
Information," which is effective for financial
statements issued for periods beginning after December
15, 1997. This statement establishes standards for
reporting operating segments in financial statements
and interim financial reports issued to shareholders.
FASB No. 131 supersedes FASB No. 14, "Financial
Reporting for Segments of a Business Enterprise" and
amends FASB No. 94, "Consolidation of All Majority-
Owned Subsidiaries". This statement requires
restatement of comparative information for earlier
years presented. Also, this statement need not be
applied to interim financial statements in the initial
year of application, but comparative information for
interim periods in the initial year of application must
be reported in financial statements for interim periods
in succeeding years.  The Company has determined that the
adoption of SFAS No. 131 will not have a material impact
on the consolidated financial statements of the Company.

<PAGE>

   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS
      LUXEMBURG BANCSHARES, INC. AND SUBSIDIARIES
                           

SELECTED QUARTERLY FINANCIAL DATA

                         Three Months Ended        Six Months Ended
                               June 30,                 June 30,
                             1997         1996        1997       1996

Net Earnings                $188,710    $180,211    $417,220    $349,842
Average Consolidated                                        
Balance Sheet Items:
   Loans                  56,029,822  49,421,368  55,287,700  48,763,504
   Taxable Investment     11,754,898  13,632,427  11,716,639  13,575,154
    Securities                 
   Municipal Loans &       4,038,993   2,005,482   3,961,071   1,715,960
    Investments              
   Other Earning Assets      730,402   2,410,293     899,704   3,770,366
      Total Earning       72,554,115  67,469,570  71,865,114  67,824,984
       Assets                   
   Total Assets           78,073,540  72,330,688  77,159,052  72,672,157
   Deposits               68,988,195  64,050,900  68,197,843  64,401,627
   Shareholders' Equity    8,036,694   7,237,424  7,938,566    7,205,697
                                                            
Key Ratios:                                                 
   Average Equity to          10.29%      10.01%      10.29%      9.92%
    Average Total Assets
   Return on Average            .97%       1.00%       1.22%      0.96%
    Total Assets
   Return on Average           9.39%       9.96%      10.51%      9.71%
    Equity
   Net Interest Margin         4.38%       4.20%       4.38%      4.11%
                                                            
NET INTEREST INCOME
Net interest income, the principal source of earnings,
is the amount by which interest generated by earning
assets exceeds the interest costs of liabilities
obtained to fund them. As shown below, net interest
income has increased $87,161 or 12.36% to $792,338 for
the three months ended June 30, 1997 from $705,177 for
the three months ended June 30, 1996. The increase in
net interest income is primarily due to a mix shift in
earning assets to loans, which provide the highest
yield of all earning assets.


               Three Months Ended June 30,    Six Months Ended June 30,
                      1997       1996               1997       1996
Interest Income   $1,525,443 $1,381,025         $2,978,595  $2,758,371
Interest Expense     733,105    675,848          1,425,279   1,380,259
Net Interest Income $792,338   $705,177         $1,553,316  $1,378,112
                                                           
Net Interest Margin    4.38%      4.20%              4.38%       4.11%

<PAGE>

RATE/VOLUME ANALYSIS
The impact of changes in volume and interest rates on
net interest income for the three and six months ended
June 30, 1997 and 1996 is illustrated in the following
tables:

Three Months Ended June 30, 1997 Compared to Three
Months Ended June 30, 1996.

Increase (Decrease) in Net Interest Income
                         Net Change   Due To       Due To
                                       Rate        Volume
Interest Income          $  144,418  $  14,768     $ 129,650
Interest Expense             57,257     (8,877)       66,134
Net Interest Income      $   87,161  $ 23,645      $  63,516
                                    

Six Months Ended June 30, 1997 Compared to Six Months
Ended June 30, 1996.

Increase (Decrease) in Net Interest Income
                         Net Change   Due To       Due To
                                       Rate        Volume
Interest Income          $  220,224   $ 3,608     $ 216,616
Interest Expense             45,020   (46,996)       92,016
Net Interest Income      $  175,204  $ 50,604     $ 124,600
                                                            

Even though the average yield on the banks loan
portfolio decreased in the second quarter of 1997
compared to the second quarter of 1996 additional loan
volume raised the average yield on all earning assets
to 8.43% for the three months ended June 30, 1997 from
8.23% for the three months ended June 30, 1996. Except
for certificates of deposits, other borrowings and
interest bearing demand deposits rates paid on the
bank's deposits were generally lower for the three
months ended June 30, 1997 compared to the three months
ended June 30, 1996. Interest expense was $733,105 for
the three months ended June 30, 1997 compared to
$675.848 for the three months ended June 30, 1996 and
reflects the growth in interest bearing deposits to
$61,749,757 for the three months ended June 30, 1997
from $57,306,871 for the three months ended June 30,
1996.

OPERATING RESULTS
Net income for the three months ended June 30, 1997
increased $8,499 or 4.7% to $188,710 from $180,211 for
the three months ended June 30, 1996. The increase in
net interest income is $87,161 for the three months
ended June 30, 1997 compared to the three months ended
June 30, 1996 and is discussed in "Net Interest Income"
and "Rate/Volume Analysis" elsewhere in this report.
Higher operating expenses for salaries and related
benefits and data processing expense for the three
months ended June 30, 1997 compared to the three months
ended June 30, 1996 offset the company's increase in
net interest margin. The increase in salaries and
related benefits is due to the opening of the company's
IGA branch in the second quarter of 1996 and higher
employee costs due to the implementation of an in-house
computer system in May, 1997 and the initial regulatory
filing in the second quarter of 1997. For the quarter
ended June 30, 1997 income tax benefit of $11,799 was
recorded by Luxemburg Bancshares, Inc. Previously the
company's accountant recorded income tax benefit only
at December 31.

Net income for the six months ended June 30, 1997 increased
$67,378 or 19.3% to 417,220 from $349,842 for the six months 
ended June 30, 1996.  The increase in net interest income is
$175,204 for the six months ended June 30, 1997 compared to 
the six months ended June 30, 1996 and is primarily due to 
higher loan volume and a shift of earning assets to loans from 
investment secirities.  Higher operating expenses for salaries 
and related benefits and data processing expense for the six 
months ended June 30, 1997 compared to the six months ended June 
30, 1996 partially offset the Company's increase in net interest
margin.  The increase in salaries and related benefits is due to 
the opening of the Company's IGA branch in the second quarter
of 1996 and higher employee costs due to the implementation of
an in-house computer system in May, 1997 and the initial 
regulatory filing in the second quarter of 1997.  For the 
quarter ended June 30, 1997 income tax benefit of $11,799 was 
recorded by Luxemburg Bancshares, Inc.  Previously, the Company's 
accountant recorded income tax benefit only at December 31.

<PAGE>

ALLOWANCE FOR LOAN LOSSES
 The amount charged to the provision for loan losses by
the Bank is based on management's evaluation as to the
amounts required to maintain an allowance adequate to
provide for potential losses inherent in the loan
portfolio. The level of this allowance is dependent
upon the total amount of past due and non-performing
loans, general economic conditions and management's
assessment of potential losses based upon internal
credit evaluations of the loan portfolio and particular
loans.  Loans are entirely to borrowers in Northeast
Wisconsin.

The Bank generally places loans on non-accrual status
when the loan is past due as to the payment of interest
and/or principal in excess of 90 days. The bank also
places loans on a non-accrual status when it deems the
collection of such interest unlikely. Loans are
returned to full accrual status when the loan is
brought current according to all terms of the loan
agreement, all past due principal and interest is paid
and the bank deems its collateral position adequate to
warrant a return to accrual status.

At June 30, 1997 and 1996 the Company did not have any
loans past due 90 days or more that were still accruing
interest nor any loans that meet the definition of
"Troubled Debt Restructuring" contained in SFAS No. 15.
In addition, there were no loans considered to be impaired
in accordance with the requirements of SFAS No. 114.
The Bank had $329,000 of nonaccrual loans at June 30,
1997 and $305,000 of nonaccrual loans at June 30, 1996.

During the three months ended June 30, 1997, $30,000
was charged to the provision for loan losses compared
to $18,000 for the three months ended June 30, 1996. At
June 30, 1997 the allowance was $702,000 or 1.19% of
total loans. This compares to an allowance of $608,000
or 1.18% of total loans as of June 30, 1996.  For the
three months ended June 30, 1997 the Bank had net
charge-offs of $13,000 compared to net charge-offs of
$1,000 for the three months ended June 30, 1996.

The following table summarizes loan charge-offs and
recoveries by type of loan for the three months ended
June 30, 1997 and 1996:

    Loan Type           June 30, 1997          June 30, 1996

                   Charge-Off   Recovery    Charge-Off  Recovery
                                                  
Real Estate           $          $            $1,000    $1,000
Commercial and                                             
 Industrial                      3,000                   4,000
Agricultural                                               
Consumer              19,000     3,000         7,000     2,000
                                                           
TOTALS               $19,000    $6,000        $8,000    $7,000


The following table summarizes loan charge-offs and recoveries 
by type of loan for the six months ended June 30, 1997 and 1996:


Loan Type                 June 30, 1997               June 30, 1996
                    Charge-Off    Recoveries    Charge-Off       Recoveries
Real Estate        $              $               $ 1,000         $ 1,000
Commercial and
 Industrial                          3,000                          4,000
Agricultural                        12,000                          4,000
Consumer             31,000          5,000          14,000          3,000

    TOTALS          $31,000        $20,000         $15,000        $12,000

<PAGE>

The Bank has allocated its allowance for credit losses
at the end of each period presented as follows:

  Balance at End of       June 30, 1997      June 30, 1996
Period Applicable to:

                                     % of              % of
                                     loans             loans
                                      to                to
                                     total             total
                          Amount     Loans   Amount    Loans
Commercial and            $   32,000   46%  $  22,000    46%
Real Estate-                            5%                4%
construction
Real Estate-mortgage                   37%               38%
Consumer                      15,000   12%               12%
                                               26,000
                                                            
Total Domestic                47,000  100%     48,000   100%
                                                            
Unallocated                  655,000                        
                                              560,000
                                                            
TOTALS                     $ 702,000  100%  $ 608,000   100%
                                                       


LIQUIDITY AND INTEREST RATE SENSITIVITY
The Company must maintain an adequate liquidity
position in order to respond to the short-term demand
for funds caused by withdrawals from deposit accounts,
extensions of credit and for the payment of operating
expenses.  Maintaining this position of adequate
liquidity is accomplished through the management of a
combination of liquid assets; those which can be
converted into cash and access to additional sources of
funds.  Primary liquid assets of the Company are cash
and due from banks, federal funds sold, investments
held as "available for sale" and maturing loans.
Federal funds sold and loans from the Federal Home Loan
Bank system represent the Company's primary source of
immediate liquidity and were maintained at a level to
meet immediate needs.  Federal Funds Sold averaged
approximately $150,000 and $1,940,000 for the three
months ended June 30, 1997 and 1996, respectively.
Maturities in the Company's loan and investment
portfolios are monitored regularly to avoid matching
short-term deposits with long-term loans and
investments. Other assets and liabilities are also
monitored to provide the proper balance between
liquidity, safety, and profitability.  This monitoring
process must be continuous due to the constant flow of
cash which is inherent in a financial institution.

The Company actively manages its interest rate
sensitive assets and liabilities to reduce the impact
of interest rate fluctuations. In addition, the Bank
monitors the interest rates paid on Certificates of
Deposit as advertised by its competitors and strives to
pay competitive interest rates to retain and attract
Certificates of Deposit. Should competitive pressures
dictate, the bank may have to increase rates paid to
retain the Certificates of the Deposit that mature in
the next year and any increase in interest rates paid
on Certificates of Deposit may reduce future 

<PAGE>

Company
Earnings. The Bank also monitors the assets and
liabilities that reprice each month to determine the
impact on future earnings from anticipated repricings.
At June 30, 1997, the Company's rate sensitive assets
exceed rate sensitive liabilities due within one year
by $3,222,000.

As part of managing liquidity, the Company monitors its
loan to deposit ratio on a daily basis.  At June 30,
1997 the ratio was 85.3% which is within the Company's
acceptable range.

The Company experienced a decrease in cash and cash
equivalents, its primary source of liquidity, of
$480,816 for the three months ended June 30, 1997. The
primary source of cash flow for the three months ended
June 30, 1997 was an increase in deposits of $2,962,977
and an increase in net borrowings of $655,922. Cash
flow from investing activities used $3,854,060 to fund
loan growth for the three months ended June 30, 1997.
The Company's management believes its liquidity sources
are adequate to meet its operating needs and does not
know of any trends, events or uncertainties that may
result in a significant adverse effect on the Company's
liquidity position.

The following table illustrates the projected
maturities and the repricing mechanisms of the major
asset/liability categories of the Company as of June
30, 1997, based on certain assumptions. No prepayment
rate assumptions have been made for the loan portfolio.
Maturities and repricing dates for investments have
been projected by applying the assumptions set forth
below to contractual maturities and repricing dates.

                       1 Year    1 - 5    5 - 10   After 10
                      or Less    Years    Years      Years
                                                   
Interest Earning                                   
Assets:
   Fed Funds Sold                                           
   Investment 
    Securities        $2,312,000  3,083,000  5,389,000  3,620,000
           
   Loans                                                    
      Variable Rate   $8,686,000
      Real Estate-    $3,004,000
       Construction       
      Real Estate-     9,570,000  6,134,000   679,000
       -Other                     
      Commercial and $10,528,000 $4,648,000  $825,000           
       Industrial              
      Agricultural   $4,441,000  $  653,000  $299,000           
      Consumer       $2,153,000  $6,666,000  $694,000
   Other             $  433,000                         

   Total Interest    $41,127,000 $21,184,000 $7,886,000  $3,620,000
    Earning Assets      
                                                            
Interest Bearing                                            
Liabilities:
   Interest Bearing                                      $5,837,000
    Demand                                       
   Savings Deposits  $2,350,000                          $10,610,000
   Money Market      $1,170,000                          $ 2,730,000
    Accounts           
   Certificates of  $24,791,000  $4,437,000
    Deposit           
   Jumbo CD's       $2,627,000                              
   IRA's            $5,758,000   $  238,000
   Other            $1,209,000   $  586,000
                                                            
                                                            
Total Interest      $37,905,000  $5,261,000               $19,177,000
 Bearing Liabilities        
                                                            
                                                            
Interest Sensitivity $3,222,000  $15,923,000  $7,886,000 ($15,557,000)
 Gap per Period       
                                                            
Cumulative Interest  $3,222,000  $19,145,000  $27,031,000 $11,474,000
Sensitivity Gap      
                                                            
Interest Sensitivity      4.3%         21.6%        10.7%     (21.1%)
Gap as a Percentage
of Earning Assets
                                                            
Cumulative                4.3%         25.9%        36.6%      15.5%
Sensitivity Gap as a
Percentage of Earning
Assets
                                                            
<PAGE>

              PART II - OTHER INFORMATION
                           
Item 6.   Exhibits and reports on Form 8-K

     (a)  Exhibits

       27.  Financial Data Schedule

     (b)  Reports on Form 8-K

     During the quarter ended June 30, 1997, the
registrant did not file any reports on Form 8-K.


                      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 hereunto
duly authorized.


                             LUXEMBURG BANCSHARES, INC.
                            (Registrant)
                           
                           

/s/  John A. Slatky               /s/  Thomas L. Lepinski
---------------------             --------------------------
John A. Slatky,                   Thomas L. Lepinski, C. P. A.
President and Chief               Treasurer
Executive Officer                 (Principal Accounting Officer)

Date    August 7, 1997             Date    August 7, 1997