UNITED STATES
                       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, 1999

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

                         Commission File Number: 0-19609
                                                 -------

                             FirstFed Bancorp, Inc.
                    ----------------------------------------
        (Exact name of Small Business Issuer as specified in its charter)

           Delaware                                63-1048648
           --------                                ----------
(State or other jurisdiction of                 (I.R.S. Employer
 incorporation or organization)                Identification No.)

1630 Fourth Avenue North
Bessemer, Alabama                                    35020
-----------------                                    -----
(Address of principal executive offices)          (Zip Code)

Issuer's telephone number, including area code: (205) 428-8472
                                                --------------

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Securities  Exchange  Act of 1934  during the  preceding  12
months (or for such shorter period that the registrant was required to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days.

         YES    [X]          NO ____

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

            Class                   Outstanding at July 16, 1999
            -----                   ----------------------------
Common Stock, $.01 par value            2,485,422 shares

Transitional Small Business Disclosure Format
(Check one):

         YES ___                 NO    [X]
<PAGE>

                             FIRSTFED BANCORP, INC.

                                                                            Page
                                                                            ----
PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS:

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
  AS OF JUNE 30, 1999 AND DECEMBER 31, 1998................................... 2

CONDENSED CONSOLIDATED STATEMENTS OF INCOME FOR THE THREE AND SIX
  MONTHS ENDED JUNE 30, 1999 AND 1998......................................... 3

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY FOR THE
  SIX MONTHS ENDED JUNE 30, 1999 AND 1998..................................... 4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE
  SIX MONTHS ENDED JUNE 30, 1999 AND 1998..................................... 5

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.......................... 6

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN
              OF OPERATION.................................................... 8

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS................................................... 13

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS........................... 13

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES..................................... 13

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS................. 13

ITEM 5.  OTHER INFORMATION................................................... 14

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.................................... 14

SIGNATURES................................................................... 15

THE CONDENSED  CONSOLIDATED FINANCIAL STATEMENTS FURNISHED HAVE NOT BEEN AUDITED
BY INDEPENDENT  CERTIFIED  PUBLIC  ACCOUNTANTS,  BUT REFLECT,  IN THE OPINION OF
MANAGEMENT,  ALL  ADJUSTMENTS  NECESSARY  FOR A FAIR  PRESENTATION  OF FINANCIAL
CONDITION AND THE RESULTS OF OPERATIONS FOR THE PERIODS PRESENTED.

                                       i.
<PAGE>
                         PART I - FINANCIAL INFORMATION
ITEM. 1.  FINANCIAL STATEMENTS
                             FIRSTFED BANCORP, INC.
            CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                          (Dollar amounts in thousands)
<TABLE>
<CAPTION>
                                                                                    June 30,       December 31,
ASSETS                                                                                1999            1998
------                                                                                ----            ----

Cash and Cash Equivalents:
<S>                                                                                <C>            <C>
         Cash on hand and in banks                                                 $     7,181    $     6,385
         Interest-bearing deposits in other banks                                        5,774          6,025
         Federal funds sold                                                             22,500         31,225
                                                                                   -----------    -----------
                                                                                        35,455         43,635
                                                                                   -----------    -----------
Securities available for sale, at fair value                                            11,865          6,609
Loans held for sale                                                                        769          2,219
                                                                                   -----------    -----------
Securities held to maturity, at amortized cost, fair
     value of $15,556 and $17,180, respectively                                         15,545         16,976
Loans receivable, net                                                                  111,277        109,209
Land, buildings and equipment, net                                                       3,164          3,065
Goodwill                                                                                 1,254          1,308
Real estate owned                                                                          224            724
Accrued interest receivable                                                              1,450          1,345
Income taxes receivable                                                                    252            602
Other assets                                                                               646            458
                                                                                   -----------    -----------
                                                                                   $   181,901    $   186,150
                                                                                   ===========    ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
         Deposits                                                                  $   162,903    $   167,257
         Accrued interest payable                                                          139            141
         Dividends payable                                                                 174            178
         Other liabilities                                                                 240            371
                                                                                   -----------    -----------
                                                                                       163,456        167,947
                                                                                   -----------    -----------
Stockholders' Equity:
         Preferred stock, $.01 par value, 1,000,000 shares
           authorized, none outstanding                                                      -              -
         Common stock, $.01 par value, 10,000,000 shares
           authorized,  3,062,139 shares issued and 2,330,134
           shares outstanding at June 30, 1999 and 3,031,646
           shares  issued and 2,301,713 shares outstanding at
           December 31, 1998                                                                31             30
         Paid-in capital                                                                 7,638          7,502
         Retained earnings                                                              15,745         15,622
         Deferred compensation obligation                                                1,243          1,199
         Deferred compensation treasury stock (152,103 shares at
           June 30, 1999 and 150,031 shares at December 31, 1998)                       (1,396)        (1,373)
         Treasury stock, at cost, 579,902 shares at June
           30, 1999, and December 31, 1998                                              (3,752)        (3,752)
         Unearned compensation                                                            (989)        (1,064)
         Unrealized (loss) gain on securities available
           for sale, net                                                                   (75)            39
                                                                                   -----------    -----------
                                                                                        18,445         18,203
                                                                                   -----------    -----------
                                                                                   $   181,901    $   186,150
                                                                                   ===========    ===========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
                                                         2
<PAGE>
                             FIRSTFED BANCORP, INC.
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
             (Dollar amounts in thousands, except per share amounts)
<TABLE>
<CAPTION>

                                             Three Months Ended        Six Months Ended
                                                   June 30,                June 30,
                                             -------------------       ----------------
                                               1999         1998         1999       1998
                                               ----         ----         ----       ----
INTEREST INCOME:
<S>                                       <C>          <C>          <C>          <C>
         Interest and fees on loans       $    2,496   $    2,705   $    4,976   $    5,402
         Interest and dividends on
           securities                            362          399          661          846
         Other interest income                   357          279          782          515
                                          ----------   ----------   ----------   ----------
           Total interest income               3,215        3,383        6,419        6,763
                                          ----------   ----------   ----------   ----------
INTEREST EXPENSE:
         Interest on deposits                  1,646        1,807        3,425        3,626
                                          ----------   ----------   ----------   ----------
           Total interest expense              1,646        1,807        3,425        3,626
                                          ----------   ----------   ----------   ----------
  Net interest income                          1,569        1,576        2,994        3,137
         Provision for loan losses                28           29           57           58
                                          ----------   ----------   ----------   ----------
  Net interest income after
    provision for loan losses                  1,541        1,547        2,937        3,079
                                          ----------   ----------   ----------   ----------
NONINTEREST INCOME:
         Fees and other noninterest
           income                                230          204          469          396
                                          ----------   ----------   ----------   ----------
NONINTEREST EXPENSE:
         Salaries and employee benefits          712          701        1,362        1,359
         Office building and equipment
           expenses                              157          141          304          282
         Deposit insurance expense                19           22           38           44
         Amortization of goodwill                 27           27           54           54
         Other operating expenses                329          294          633          593
                                          ----------   ----------   ----------   ----------
           Total noninterest expenses          1,244        1,185        2,391        2,332
                                          ----------   ----------   ----------   ----------
  Income before income taxes                     527          566        1,015        1,143
         Provision for income taxes              194          190          371          381
                                          ----------   ----------   ----------   ----------
  NET INCOME                              $      333   $      376   $      644   $      762
                                          ==========   ==========   ==========   ==========
AVERAGE NUMBER OF SHARES
         OUTSTANDING - BASIC               2,400,787    2,321,010    2,393,622    2,228,051
                                          ==========   ==========   ==========   ==========
BASIC EARNINGS PER SHARE                  $      .14   $      .16   $      .27   $      .34
                                          ==========   ==========   ==========   ==========
AVERAGE NUMBER OF SHARES
         OUTSTANDING - DILUTED             2,476,106    2,447,685    2,470,880    2,350,262
                                          ==========   ==========   ==========   ==========
DILUTED EARNINGS PER SHARE                $      .13   $      .15   $      .26   $      .32
                                          ==========   ==========   ==========   ==========
DIVIDENDS DECLARED PER SHARE              $      .07   $    .1325   $      .21   $    .1925
                                          ==========   ==========   ==========   ==========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
                                                         3
<PAGE>
                             FIRSTFED BANCORP, INC.
            CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                 For the Six Months Ended June 30, 1999 and 1998
            (Dollar amounts in thousands, except per share amounts)
<TABLE>
<CAPTION>
                                                                                                             Unrealized
                                                                               Deferred                     Gain (Loss)
                                                                    Deferred    Compen-                    on Securities
                                                                     Compen-    sation            Unearned   Available     Compre-
                                     Common   Paid-In   Retained     sation    Treasury Treasury   Compen-    for Sale,    hensive
                                      Stock   Capital   Earnings    Obligation   Stock    Stock    sation       Net         Income
                                      -----   -------   --------    ----------   -----    -----    ------       ---        --------
<S>                                <C>        <C>       <C>        <C>           <C>       <C>       <C>        <C>         <C>
BALANCE, December 31, 1997         $    14    $ 6,676   $14,968    $        -    $      -  $(4,320)  $   (26)   $     12

     Net income                          -          -       762             -           -        -         -           -    $   762
     Change in unrealized gain
         (loss) on securities
         available for sale, net
         of tax of $3                    -          -         -             -           -        -         -           5          5
                                                                                                                            -------
     Comprehensive income                -          -         -             -           -        -         -           -    $   767
                                                                                                                            =======
     Amortization of unearned
         compensation                    -          -         -             -           -        -        59           -
     Awards under stock plans            1        206         -             -           -        -      (207)          -
     Dividends declared ($.1925
         per share)                      -          -      (471)            -           -        -         -           -
     Exercise of stock options           -         45         -             -           -        -         -           -
     Stock issued under Dividend
         Reinvestment Plan               1         71         -             -           -        -         -           -
     Issuance of treasury stock
         to Employee Stock
         Ownership Plan                  -        382         -             -           -      568      (950)          -
     ESOP change in value                -          2         -             -           -        -         -           -
     Two-for-one stock split            14        (14)        -             -           -        -         -           -
                                   -------     ------   --------       -------    -------  -------   -------      ------
BALANCE, June 30, 1998             $    30     $7,368   $ 15,259       $     -    $     -  $(3,752)  $(1,124)     $   17
                                   =======     ======   ========       =======    =======  =======   =======      ======

BALANCE, December 31, 1998         $    30     $7,502   $ 15,622       $1,199     $(1,373) $(3,752)  $(1,064)     $   39

     Net income                          -          -        644            -           -        -         -           -    $   644
     Change in unrealized gain
         (loss) on securities
         available for sale, net
         of tax of $84                   -          -          -            -           -        -         -        (114)      (114)
                                                                                                                            -------
     Comprehensive income                -          -          -            -           -        -         -           -    $   530
                                                                                                                            =======
     Amortization of unearned
         compensation                    -          -          -            -           -        -        75           -
     Dividends declared ($.21
         per share)                      -          -       (521)           -           -        -         -           -
     Exercise of stock options           -         60          -            -           -        -         -           -
     Stock issued under Dividend
         Reinvestment Plan               1         89          -            -           -        -         -           -
     Amortization of Deferred
         Compensation Plan
         Obligation                      -          -          -           21           -        -         -           -
     Addition to Deferred
         Compensation Plan               -          -          -           23         (23)       -         -           -
     ESOP change in value                -        (13)         -            -           -        -         -           -
                                   -------     ------   --------       -------    -------  -------   -------      ------
BALANCE, June 30, 1999             $    31     $7,638   $ 15,745       $ 1,243    $(1,396) $(3,752)  $  (989)     $  (75)
                                   =======     ======   ========       =======    =======  =======   =======      ======
</TABLE>
See accompanying notes to condensed consolidated financial statements.

                                                         4
<PAGE>
                             FIRSTFED BANCORP, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                          (Dollar amounts in thousands)
<TABLE>
<CAPTION>

                                                                                  Six Months Ended
                                                                                        June 30,
CASH FLOWS FROM OPERATING ACTIVITIES:                                                1999      1998
                                                                                     ----      ----
<S>                                                                               <C>         <C>
  Net income                                                                      $    644    $    762
  Adjustments to reconcile net income
    to net cash provided by (used in) operating activities:
     Depreciation                                                                      130         129
     Amortization of unearned compensation and deferred compensation
       obligation                                                                      109          59
     Amortization of purchase premiums, net                                             99          69
     Accretion of deferred income (expense), net                                      (139)          3
     Provision (credit) for deferred income taxes                                        -        (258)
     Provision for loan losses                                                          57          58
     Loan fees (cost) deferred, net                                                    196          13
     (Gain) loss on sale of real estate, net                                           (26)         12
     Origination of loans held for sale                                             (8,003)    (12,613)
     Proceeds from loans held for sale                                               9,453      12,017
     Amortization of goodwill                                                           54          54
     Change in assets and liabilities:
         (Increase) decrease in accrued interest receivable                           (105)        123
         (Increase) decrease in other assets                                          (188)       (185)
         (Increase) decrease in current income taxes receivable                        436           -
         Increase (decrease) in accrued interest payable                                (2)        (14)
         Increase (decrease) in current income taxes payable                             -         (23)
         Increase (decrease) in other liabilities                                     (131)        (77)
                                                                                  --------    --------
           Net cash provided by operating activities                                 2,584         129
                                                                                  --------    --------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Proceeds from maturities of securities available for sale                          1,800       4,738
  Purchase of securities available for sale                                         (7,252)     (1,249)
  Proceeds from maturities and payments received on securities held to maturity      6,330       4,836
  Purchase of securities held to maturity                                           (5,000)       (552)
  Proceeds from sale of real estate and repossessed assets                             668         162
  Net loan repayments (originations)                                                (2,351)      2,918
  Capital expenditures                                                                (229)        (28)
                                                                                  --------    --------
         Net cash provided by (used in) investing activities                        (6,034)     10,825
                                                                                  --------    --------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Increase (decrease) in deposits, net                                              (4,354)        979
  Proceeds from exercise of stock options                                               60          47
  Dividends paid                                                                      (525)       (445)
  Proceeds from dividend reinvestment                                                   89          69
                                                                                  --------    --------
         Net cash provided by (used in) financing activities                        (4,730)        650
                                                                                  --------    --------
NET INCREASE (DECREASE) IN CASH & CASH EQUIVALENTS                                  (8,180)     11,604
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                    43,635      20,080
                                                                                  --------    --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                                        $ 35,455    $ 31,684
                                                                                  ========    ========
SUPPLEMENTAL CASH FLOW INFORMATION:
  Cash paid during the period for-
     Income taxes                                                                 $     20    $    672
     Interest                                                                        3,427       3,640
  Noncash transactions-
     Transfer of loans receivable to real estate
       owned                                                                           169         386
     Declaration of cash dividends                                                     173         170
     Recording of deferred compensation                                                 23           -
     Noncash compensation under stock plans                                              -         207
</TABLE>
See accompanying notes to condensed consolidated financial statements.

                                        5
<PAGE>
                             FIRSTFED BANCORP, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION:

FirstFed  Bancorp,  Inc.  (the  "Company")  is  the  holding  company  and  sole
shareholder  of First  Federal  Savings Bank ("First  Federal")  and First State
Corporation  ("FSC"),  which in turn is the sole shareholder of First State Bank
of Bibb County  ("First  State").  First Federal and First State are referred to
herein collectively as the "Banks".

The accompanying condensed consolidated financial statements as of June 30, 1999
(unaudited),  and December 31, 1998, and for the three and six months ended June
30,  1999 and 1998  (unaudited),  include  the  accounts  of the Company and the
Banks.  All  significant  intercompany   transactions  and  accounts  have  been
eliminated in consolidation.

In the  opinion of  management,  all  adjustments  (none of which are other than
normal recurring  accruals)  necessary for a fair presentation of the results of
such interim periods have been included. The results of operations for the three
and six months  ended  June 30,  1999,  are not  necessarily  indicative  of the
results of operations which may be expected for the entire fiscal year.

These unaudited  condensed  financial  statements  should be read in conjunction
with the Consolidated Financial Statements and the notes thereto included in the
Company's Annual Report on Form 10-KSB for the year ended December 31, 1998. The
accounting  policies  followed  by the  Company  are set forth in the Summary of
Significant Accounting Policies in the Company's December 31, 1998, Consolidated
Financial Statements.

2. EARNINGS AND DIVIDENDS PER SHARE:

Earnings  per share for the three and six months  ended June 30,  1999 and 1998,
respectively, were as follows:
<TABLE>
<CAPTION>

                              Three Months                            Three Months
                           Ended June 30, 1999                     Ended June 30, 1998
                      -----------------------------------      ---------------------------------
                                 Dilutive                                Dilutive
                                Effect of                               Effect of
                                 Options                                 Options
                       Basic      Issued         Diluted        Basic     Issued      Diluted
                       -----      ------         -------        -----     ------      -------
<S>                   <C>         <C>           <C>            <C>         <C>         <C>
Net income            $ 333,000      ---        $ 333,000      $ 376,000       ---     $ 376,000
Shares available to
 common shareholders  2,400,787   75,319        2,476,106      2,321,010   126,675     2,447,685
                      ---------   ------        ---------      ---------   -------     ---------
Earnings per share    $    0.14      ---        $    0.13      $    0.16       ---     $    0.15
                      =========   ======        =========      =========   =======     =========

</TABLE>
                                        6
<PAGE>
<TABLE>
<CAPTION>
                               Six Months                              Six Months
                           Ended June 30, 1999                     Ended June 30, 1998
                      -----------------------------------      ---------------------------------
                                 Dilutive                                Dilutive
                                Effect of                               Effect of
                                 Options                                 Options
                       Basic      Issued         Diluted        Basic     Issued        Diluted
                       -----      ------         -------        -----     ------        -------
<S>                   <C>         <C>           <C>            <C>         <C>          <C>
Net income            $ 644,000        ---      $ 644,000      $ 762,000       ---      $ 762,000
Shares available to
 common shareholders  2,393,622     77,258      2,470,880      2,228,051   122,211      2,350,262
                      ---------     ------      ---------      ---------   -------      ---------
Earnings per share    $    0.27        ---      $    0.26      $    0.34       ---      $    0.32
                      =========     ======      =========      =========   =======      =========
</TABLE>
Dividends declared for the quarter ended June 30, 1999,  consisted of a $.07 per
share quarterly  dividend and for the six months ended June 30, 1999,  consisted
of $.14 per share quarterly dividends and a $.07 per share special dividend.

3. SEGMENT DISCLOSURE:

The holding company is considered a separate reportable segment from the banking
operations  since it does not  offer  products  or  services  or  interact  with
customers,  but  does  meet  the  quantitative  threshold  as  outlined  in  the
accounting  standards.  The Company's  segment  disclosure is as follows for the
three and six months ended June 30, 1999 and 1998.
<TABLE>
<CAPTION>

                                           Three Months Ended June 30, 1999
                                ------------------------------------------------------
                                   Banking     Holding                        Total
                                 Operations    Company     Eliminations      Company
                                 ----------    -------     ------------      -------
                                                   (In thousands)
<S>                            <C>            <C>           <C>             <C>
Net interest income            $    1,546     $     23      $        -      $    1,569
Provision for loan losses              28            -               -              28
Noninterest income                    230            -               -             230
Noninterest expense                 1,116          128               -           1,244
                               ----------     --------      ----------      ----------
  Income before income
      taxes                           632         (105)              -             527
Income tax expense                    229          (35)              -             194
                               ----------     --------      ----------      ----------
     Net income                $      403     $    (70)     $        -      $      333
                               ==========     ========      ==========      ==========
     Total assets              $  181,794     $ 18,446      $  (18,339)     $  181,901
                               ==========     ========      ==========      ==========
</TABLE>
<TABLE>
<CAPTION>
                                         Three Months Ended June 30, 1998
                                -------------------------------------------------------
                                   Banking     Holding                        Total
                                 Operations    Company     Eliminations      Company
                                 ----------    -------     ------------      -------
                                                   (In thousands)
<S>                            <C>            <C>           <C>             <C>
Net interest income            $    1,540     $      36     $        -      $    1,576
Provision for loan losses              29             -              -              29
Noninterest income                    204             -              -             204
Noninterest expense                 1,071           114              -           1,185
                               ----------     ---------     ----------      ----------
  Income before income
    taxes                             644           (78)             -             566
Income tax expense                    216           (26)             -             190
                               ----------     ---------     ----------      ----------
     Net income                $      428     $     (52)    $        -      $      376
                               ==========     =========     ==========      ==========
     Total assets              $  179,662     $  17,798     $  (17,567)     $  179,893
                               ==========     =========     ==========      ==========
</TABLE>
                                        7
<PAGE>
<TABLE>
<CAPTION>
                                         Six Months Ended June 30, 1998
                                -------------------------------------------------------
                                   Banking     Holding                        Total
                                 Operations    Company     Eliminations      Company
                                 ----------    -------     ------------      -------
                                                   (In thousands)
<S>                            <C>            <C>           <C>             <C>
Net interest income            $    2,946     $    48       $        -      $    2,994
Provision for loan losses              57           -                -              57
Noninterest income                    469           -                -             469
Noninterest expense                 2,175         216                -           2,391
                               ----------     -------       ----------      ----------
  Income before income
     taxes                          1,183        (168)               -           1,015
Income tax expense                    429         (58)               -             371
                               ----------     -------       ----------      ----------
     Net income                $      754     $  (110)      $        -      $      644
                               ==========     =======       ==========      ==========
     Total assets              $  181,794     $18,446       $  (18,339)     $  181,901
                               ==========     =======       ==========      ==========
</TABLE>
<TABLE>
<CAPTION>
                                           Six Months Ended June 30, 1998
                                -------------------------------------------------------
                                   Banking     Holding                        Total
                                 Operations    Company     Eliminations      Company
                                 ----------    -------     ------------      -------
                                                   (In thousands)
<S>                            <C>            <C>           <C>             <C>
Net interest income            $    3,066     $    71       $        -      $    3,137
Provision for loan losses              58           -                -              58
Noninterest income                    396           -                -             396
Noninterest expense                 2,135         197                -           2,332
                               ----------     -------       ----------      ----------
  Income before income
     taxes                          1,269        (126)               -           1,143
Income tax expense                    428         (47)               -             381
                               ----------     -------       ----------      ----------
     Net income                $      841     $   (79)      $        -      $      762
                               ==========     =======       ==========      ==========
     Total assets              $  179,662     $17,798       $  (17,567)     $  179,893
                               ==========     =======       ==========      ==========
</TABLE>
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Management's discussion and analysis includes certain forward-looking statements
addressing,  among other  things,  the Company's  prospects for earnings,  asset
growth and net interest margin.  Forward-looking  statements are accompanied by,
and  identified  with,  such  terms  as  "anticipates,"  "believes,"  "expects,"
"intends,"  and similar  phrases.  Management's  expectations  for the Company's
future necessarily  involve a number of assumptions and estimates.  Factors that
could cause actual results to differ from the expectations expressed herein are:
substantial  changes in  interest  rates,  changes in the general  economy,  and
changes in the Company's  strategies for credit-risk  management,  interest-rate
risk  management and investment  activities.  Accordingly,  any  forward-looking
statements  included herein do not purport to be predictions of future events or
circumstances and may not be realized.

Comparison of Financial Condition as of June 30, 1999, and December 31, 1998

All dollar amounts, except per share amounts, included hereafter in Management's
Discussion and Analysis are in thousands.

Cash and cash  equivalents  decreased  $8,180,  or 18.7%, to $35,455 at June 30,
1999, from $43,635 at December 31, 1998.  This decrease is primarily  related to
the decrease in deposits for the same period,

                                        8
<PAGE>
net of an increase in loans and securities.  The Banks had 14-month and 19-month
special certificate of deposit programs and these certificates matured primarily
during the first half of 1999. Some rate sensitive funds were not retained.

Securities  available for sale and held to maturity  increased $3,825, or 16.2%,
to $27,410 at June 30, 1999,  primarily due to purchases  totaling  $12,252 less
securities totaling $8,130 either maturing,  being called prior to maturity,  or
payments being received.

Loans receivable,  net, at June 30, 1999, were $111,277,  an increase of $2,068,
or 1.9%,  from $109,209 at December 31, 1998. The increase in loans  receivable,
net, was primarily due to an increase in the  origination of mortgage loans that
were retained in the Banks' portfolios.

The  Company's  consolidated  allowance  for loan losses  decreased  slightly to
$1,071 at June 30, 1999,  from $1,081 at December 31, 1998. This decrease of $10
was due to net charge-offs  over recoveries of $67 offset by a provision of $57.
Nonperforming  loans,  which  includes  nonaccruing  loans  and  accruing  loans
delinquent ninety days or more, at June 30, 1999,  decreased to $1,291, or 1.16%
of loans  receivable,  from $1,735, or 1.48% of loans receivable at December 31,
1998.  At  June  30,  1999,  there  were  no  material  loans  not  included  in
nonperforming  loans which  represented  material credits about which management
was aware of any information  which caused  management to have serious doubts as
to the ability of such borrowers to comply with the loan repayment terms.

Real estate owned was $224 at June 30,  1999,  a decrease of $500 from  December
31, 1998,  as a result of the sale of several  properties  during the six months
ended June 30, 1999.

Deposits  decreased $4,354, or 2.6%, to $162,903 at June 30, 1999, from $167,257
at December  31, 1998.  The decrease in deposits is primarily  the result of the
maturity of certificates of deposit  generated in special programs as previously
discussed.

The Company had stockholders' equity of $18,445 as of June 30, 1999, an increase
of $242, or 1.3%,  from $18,203 as of December 31, 1998. The primary  components
of the change were net income for the six months  ended June 30,  1999,  of $644
less dividends of $.21 per share totaling $521.

Liquidity and Capital Resources

Traditionally,  the  Banks'  principal  sources  of funds  have  been  deposits,
principal and interest  payments on loans and  mortgage-backed  securities,  and
proceeds from  interest on and  maturities of  investments.  In addition,  First
Federal has borrowing  ability from the Federal Home Loan Bank of Atlanta if the
need for additional funds arises. At June 30, 1999, the Banks had commitments to
originate and fund loans of $8.6 million.  The Banks  anticipate  that they will
have sufficient funds available to meet their current commitments.

First  Federal is required by regulation  to maintain  minimum  levels of liquid
assets.  The liquidity ratio of First Federal at June 30, 1999, was 23.8%, which
exceeded the applicable regulatory  requirement.  Under applicable  regulations,
First Federal, First State and the Company are each required to maintain minimum
capital  ratios.  Set forth  below are actual  capital  ratios  and the  minimum
regulatory capital requirements as of June 30, 1999.

                                       9
<PAGE>
<TABLE>
<CAPTION>

                                        First Federal          First State            The Company
                                        -------------          -----------            -----------
RISK-BASED CAPITAL RATIOS
Tier 1 Capital:
<S>                                  <C>           <C>      <C>         <C>        <C>         <C>
Stockholders' Equity less goodwill   $ 12,234      9.20%    $  3,535     7.51%     $ 17,266     9.49%
Minimum Required                        5,320      4.00%       1,884     4.00%        7,276     4.00%
                                     --------   -------     --------   ------      --------   ------
Excess                               $  6,914      5.20%    $  1,651     3.51%     $  9,990     5.49%
                                     ========   =======     ========   ======      ========   ======
Total Capital:
Tier 1 Capital plus allowances
  for loan losses                    $ 13,027     16.65%    $  3,814    14.50%     $ 18,337    16.89%
Minimum Required                        6,259      8.00%       2,104     8.00%        8,683     8.00%
                                     --------   -------     --------   ------      --------   ------
Excess                               $  6,768      8.65%    $  1,710     6.50%     $  9,654     8.89%
                                     ========   =======     ========   ======      ========   ======
Total Risk-weighted Assets           $ 78,238               $ 26,300               $105,438
                                     ========               ========               ========

LEVERAGE RATIO
Tier 1 Capital                       $ 12,234      9.20%    $  3,535     7.51%     $ 17,266     9.49%
Minimum Leverage Requirement            5,320      4.00%       1,884     4.00%        7,276     4.00%
                                     --------   -------     --------   ------      --------   ------
Excess                               $  6,914      5.20%    $  1,651     3.51%     $  9,990     5.49%
                                     ========   =======     ========   ======      ========   ======

TANGIBLE CAPITAL RATIO
Tangible Capital                     $12,234       9.20%            N/A                    N/A
Tangible Capital Requirement           1,995       1.50%
                                     -------      -----
Excess                               $10,239       7.70%
                                     =======      =====
</TABLE>
As of June  30,  1999,  management  was  not  aware  of any  trends,  events  or
uncertainties  that will have or are reasonably likely to have a material effect
on the Company's or the Banks' liquidity, capital resources or operations.

Results  of  Operations - Comparison of the Three Months Ended June 30, 1999 and
1998

Net income for the three  months  ended June 30,  1999,  was $333, a decrease of
$43, or 11.4%, from net income of $376 for the three months ended June 30, 1998.
The decrease was primarily  attributable  to an increase in noninterest  expense
related to upgrades in technology including preparation for Year 2000.

Interest Income

Total interest  income  decreased  $168, or 5.0%, to $3,215 for the three months
ended June 30,  1999.  This  decrease  was  primarily  due to a decrease  in the
average  yield  on   interest-earning   assets  to  7.7%,   from  8.2%  for  the
corresponding  quarter of the previous year,  offset by a slight increase in the
average balance of interest-earning assets.

Interest Expense

Interest  expense for the quarter ended June 30, 1999, was $1,646, a decrease of
$161, or 8.9%, to $1,646 from the quarter ended June 30, 1998.  The decrease was
primarily  the result of a decrease in the average rate paid on deposits for the
three  months  ended  June 30,  1999,  to 4.0% from  4.6% for the  corresponding
quarter of the previous year, net of a slight increase in the average balance of
deposits.

Net Interest Income

Net interest  income for the quarter ended June 30, 1999, was $1,569 compared to
$1,576 for the quarter

                                       10
<PAGE>
ended June 30, 1998. The average net interest spread increased  slightly to 3.7%
for the three months  ended June 30, 1999,  from 3.6% for the same period in the
prior year. The net interest margin was 3.8% for the three months ended June 30,
1999 and June 30, 1998.

Provision for Loan Losses

Management  increased  the  Company's  total  allowance  for  loan  losses  by a
provision of $28 during the quarter ended June 30, 1999.  The Banks'  allowances
for loan  losses  were  based on  management's  evaluation  of  possible  losses
inherent in the loan portfolio and consider,  among other factors,  prior years'
loss experience,  economic  conditions,  distribution of portfolio loans by risk
class and the estimated value of the underlying collateral.

Noninterest Income

Noninterest  income  during the quarter ended June 30, 1999,  increased  $26, to
$230, from the June 30, 1998, level of $204. The increase in noninterest  income
is primarily the result of an increase in secondary market fees for loans sold.

Noninterest Expenses

Noninterest  expenses  during the quarter ended June 30, 1999,  increased $59 to
$1,244 from the June 30, 1998, level of $1,185. Increases in noninterest expense
are related to upgrades in technology including preparation for Year 2000.

Income Taxes

The  provision  for income taxes  increased $4, or 2.1%, to $194 for the quarter
ended June 30, 1999, as compared to the corresponding quarter in 1998.

Results  of  Operations - Comparison  of  the Six Months Ended June 30, 1999 and
1998

Net income for the six months ended June 30, 1999, was $644, a decrease of $118,
from net income of $762 for the six months ended June 30, 1998. The decrease was
primarily  attributable to a decrease in the Banks' interest rate spread because
of a higher liquidity position on average during the current year.

Interest Income

Total  interest  income  decreased  $344,  or 5.1%, to $6,419 for the six months
ended June 30, 1999. This decrease was primarily the result of a decrease in the
average yield on the interest-earning assets to 7.6% during the six months ended
June 30, 1999, from 8.2% during the six months ended June 30, 1998. The decrease
was partially  offset by an increase in the average balance of  interest-earning
assets  during the six months ended June 30, 1999, as compared to the six months
ended June 30, 1998.

Interest Expense

Interest  expense for the six months ended June 30,  1999,  decreased  $201,  or
5.5%,  to $3,425,  from $3,626  during the six months ended June 30, 1998.  This
decrease was primarily attributable to a reduction

                                       11
<PAGE>
in the average rate paid on deposits to 4.2% for the six month period ended June
30, 1999, compared to 4.6% for the same period a year ago.

Net Interest Income

Net interest  income for the six months ended June 30, 1999,  decreased $142, or
4.6%,  to  $2,937,  from  $3,079 for the six months  ended June 30,  1998.  This
decrease was due  primarily to a decrease in the average net interest  spread to
3.4% for the six months ended June 30, 1999,  from 3.6% for the six months ended
June 30, 1998. The net interest margin decreased to 3.5% in the six months ended
June 30, 1999, from 3.8% in the six months ended June 30, 1998.

Provision for Loan Losses

The Company's consolidated  allowances for loan losses are based on management's
evaluation  of  possible  losses  inherent in the loan  portfolios.  Among other
factors,  management  considers  historical loss  experience,  current  economic
conditions,  distribution of the loan portfolios by risk class and the estimated
value  of the  underlying  collateral.  The  allowances  for  loan  losses  were
increased  by  provisions  totaling  $57 for the six months ended June 30, 1999.
These  provisions  were recorded to maintain the  allowances  for loan losses at
adequate levels based on management's best estimates.

Noninterest Income

Noninterest  income for the six  months  ended June 30,  1999,  totaled  $469 as
compared  to $396 for the six  months  ended  June 30,  1998.  The  increase  in
noninterest  income is primarily  the result of an increase in secondary  market
fees for loans sold.

Noninterest Expenses

Noninterest expenses during the six months ended June 30, 1999, increased $59 to
$2,391 from the fiscal 1998 level of $2,332. The increase in noninterest expense
is partially  related to upgrades in technology  including  preparation for Year
2000.

Income Taxes

The provision for income taxes  decreased  $10, to $371 for the six months ended
June 30, 1999, as compared to the  corresponding  period of the prior year.  The
decreased tax expense was due to the decrease in pretax income.

Year 2000

The Company has addressed, and will continue to address, the issue of Year 2000,
which  relates to software  originally  being  written  using a two digit format
rather than a four digit format to represent  the year.  The date change  format
requires modification to some software and computer systems so that dates beyond
December 31, 1999, will be properly recognized. The Banks have formed committees
to assess,  test,  prepare and overview the applicable  software,  equipment and
related  technologies  related to Year 2000 readiness.  This assessment  covered
both information technology systems and non-information technology systems.

                                       12
<PAGE>
The Banks rely primarily  upon a third party  processor and other vendors rather
than  internally-generated  software.  Based on the  analysis  of  software  and
equipment, in addition to ongoing discussions with vendors, the Company believes
that upgrades,  modifications  or conversion of software  planned by the Company
and the third party vendors will properly address the Year 2000 issue. The third
party  processor,  which processes all customer related data, has represented to
the Banks that the testing of the software had been  substantially  completed at
June 30, 1999.  The Banks have  adopted Year 2000 Test Plans and have  conducted
testing and evaluated results.  Management presently believes that the Year 2000
issue will not pose a substantial internal operating risk to the Company.

Additionally,  the Company has implemented a process for assessing  readiness of
various suppliers of other services.  There can be no guarantee,  however,  that
the systems of these  outside  parties  will be Year 2000  compliant on a timely
basis.  In turn,  this  could  result in  disruption  to the  operations  of the
Company.

The Banks have  adopted a Year 2000  Contingency  Plan which  would  replace its
computerized operations with a manual system, if necessary.

The Banks are educating and assisting  customers in identifying  their Year 2000
issues.  It has been  determined that this is a relatively low risk area in that
the Banks' commercial  customers have a minimal reliance on computers to conduct
business.

Total Year 2000 costs include such items as payroll  costs,  upgrading  existing
software applications, replacing certain hardware and customer awareness program
materials. The Banks do not have a system that specifically tracks all costs and
time spent on the Year 2000 issue.  The Company is in the process of  estimating
total  expense  related to Year 2000.  Externally  generated  expenses  incurred
during the quarter ended June 30, 1999, are not considered significant.

                           PART II. OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

From time to time, the Banks are parties to routine legal proceedings  occurring
in the  ordinary  course of  business.  At June 30,  1999,  there  were no legal
proceedings  to which the  Company or the Banks were a party or  parties,  or to
which any of their  property was subject,  which were  expected by management to
result in a material loss.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

On April 27, 1999, the Company held the 1999 Annual Meeting of Stockholders. The
election of James B. Koikos,  E. H. Moore,  Jr. and James E. Mulkin as directors
was submitted to a vote of the stockholders.  The following is the result of the
vote:

                                       13
<PAGE>
                                       For            Withheld
                                       ---            --------
           James B. Koikos           2,146,092         97,800
           E. H. Moore, Jr.          2,146,092         97,800
           James E. Mulkin           2,146,092         97,800

         There were no broker non-votes in the above matter.

ITEM 5.  OTHER INFORMATION

None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits.

         Exhibit 27 - Financial Data Schedule (SEC use only).

(b)      Reports on Form 8-K.
         None.

                                       14
<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.

                                    FIRSTFED BANCORP, INC.

Date: August 9, 1999                \s\ B. K. Goodwin, III
      ------------------------      ----------------------------------
                                    B. K. Goodwin, III,
                                    Chairman of the Board,
                                    Chief Executive Officer
                                    and President

Date: August 9, 1999                \s\ Lynn J. Joyce
      ------------------------      -------------------------------------
                                    Lynn J. Joyce
                                    Chief Financial Officer, Vice
                                    President, Secretary and
                                    Treasurer

                                       15