Exhibit
99.1




For
Immediate Release


July
23, 2008





AJS
BANCORP, INC. ANNOUNCES SECOND QUARTER EARNINGS





AJS
Bancorp, Inc. (OTCBB; AJSB.OB), the holding company for A.J. Smith Federal
Savings Bank, Midlothian, Illinois today reported consolidated net income of
$192,000 for the quarter ended June 30, 2008 as compared to $159,000 for the
same quarter in 2007.  Basic and diluted earnings per share were $0.09
for the quarter ended June 30, 2008 as compared with basic earnings per share of
$0.08 and diluted earnings per share of $0.07 for the quarter ended June 30,
2007.  The increase in net income resulted from an increase in net
interest income after provision for loan losses and an increase in non-interest
income, offset by an increase in non-interest expense.  Net income for
the six months ended June 30, 2008 was $280,000 compared to net income of
$410,000 for the six months ended June 30, 2007.  Basic and diluted
earnings were $0.14 per share for the six months ended June 30, 2008 compared to
basic and diluted earnings of $0.19 per share for the six months ended June 30,
2007.





Total
assets at June 30, 2008 were $247.1 million, a decrease of $1.2 million or 0.5%
from $248.3 million at December 31, 2007.  The decrease in total
assets reflects decreases in cash and cash equivalents and securities, partially
offset by an increase in certificates of deposit at other financial institutions
and other assets.  Loans receivable remained fairly stable for the
comparable periods.  There was a decrease of $1.3 million or 6.8% in
cash and cash equivalents to $17.1 million at June 30, 2008 from $18.4 million
at December 31, 2007.





Securities
decreased $4.5 million or 5.5% to $77.0 million at June 30, 2008 compared to
$81.5 million at December 31, 2007.  The decrease in securities was
primarily due to the sale of $11.4 million in a mortgage mutual fund in April
2008 and maturities, calls, and principal repayments of fixed-rate government
sponsored notes, bonds and mortgage-backed securities, offset by purchases of
$26.7 million of mortgage-backed securities and fixed-rate
government sponsored notes and bonds.  The Company elected the
fair value option for its marketable equity investments as of January 1, 2008,
the effective date for Statement No. 159, The Fair Value Option for Financial
Assets and Financial Liabilities standard.  Subsequent to the
election, the Company sold 100% of its mutual fund investment and recorded a
total realized loss of $192,000, of which $120,000 was recorded in the first
quarter of 2008 as a fair value adjustment and $72,000 was recorded in the
second quarter of 2008.  The only asset currently remaining that will
be valued using FASB Statement 159 is the Company’s common stock
investment.  The Company purchased $22.7 million in Federal National
Mortgage Association and Federal Home Loan Mortgage Corporation mortgage-backed
securities (“MBS”) and $4.0 million in callable government backed notes and
bonds.  The MBS securities purchased were well seasoned securities or
securities with maturities of fifteen years or less.


Other
assets increased $333,000 or 5.7% to $6.1 million at June 30, 2008 from $5.8
million at December 31, 2007.  The increase in other assets was
primarily due to an increase in other real estate owned and the cash surrender
value of the Company’s bank-owned life insurance (“BOLI”).  Other real
estate owned increased to $179,000 at June 30, 2008.  The Company had
no other real estate owned at December 31, 2007. The cash surrender value of
BOLI increased $74,000 to $3.1 million at June 30, 2008.  Total
liabilities decreased $1.8 million or 0.8% to $218.6 million from $220.4 million
due to a $10.8 million or 5.7% decrease in deposit balances at June 30, 2008
compared to December 31, 2007.  Federal Home Loan Bank (“FHLB”)
advances increased $9.2 million or 39.5% to $32.6 million at June 30, 2008
compared to $23.4 million at December 31, 2007.  The Company borrowed
$13.8 million from the FHLB during the six months ended June 30,
2008.  The borrowings have maturities from two to five
years.





The
Company had non-performing assets of $620,000 at June 30, 2008 and $934,000 at
December 31, 2007.  The decrease in non-performing assets primarily
reflects a decrease in the number of non-performing loans the Company holds at
June 30, 2008 compared to December 31, 2007.  The Company had five
non-performing loans and one other real estate owned property as of June 30,
2008 and ten non-performing loans as of December 31, 2007.   The
Company had no other real estate owned properties as of December 31,
2007.  The allowance for loan losses was $1.4 million at June 30, 2008
and $1.5 million at December 31, 2007.  Our ratio of allowance for
loan losses to gross loans receivable was 1.04% at June 30, 2008 and 1.15% at
December 31, 2007.  The allowance for loan losses to non-performing
loans was 225.65% as of June 30, 2008 compared to 164.78% as of December 31,
2007.





Total
stockholders’ equity increased $566,000 to $28.5 million at June 30, 2008 from
$27.9 million at December 31, 2007.  The increase was primarily due to
a $440,000 decrease in the ESOP put option liability explained below, and net
income of $280,000 for the six months ended June 30, 2008, partially offset by
dividends paid and common stock repurchased during the six months ended
June 30, 2008.  The Internal Revenue Service ("IRS") has determined
that any security traded on the bulletin board or pink sheets does not have a
sufficiently active market to support the trading necessary should an employee
wish to sell their Company stock they received as a part of the
ESOP.  Therefore, the Company has a contingent liability offset by an
entry to additional paid in capital in an amount equal to the market value of
the vested portion of the ESOP at December 31, 2007 as a result of the
obligation the Company has to repurchase the stock should the employee decide to
sell it and there were no buyers available on the open market.  The
ESOP put option liability decreased $440,000 during the six months ended June
30, 2008 to $1.4 million from $1.8 million at December 31, 2007 reflecting the
decrease in the market value of the vested portion of the common stock held in
the ESOP.  The increases were offset by dividends paid of $176,000 and
common stock repurchases totaling $126,000 or 6,327 shares that took place
during the six months ended June 30, 2008.








INCOME
INFORMATION –THREE MONTH PERIODS ENDED JUNE 30, 2008 AND 2007:





Net
interest income decreased by $8,000 or 0.5% to $1.6 million for the quarter
ended June 30, 2008 when compared to the same quarter in 2007.  The
decrease in net interest income primarily reflects an increase in the cost of
FHLB advances due to an increase in the average outstanding FHLB borrowings for
the comparable periods, as well as the Company’s average balances of
interest-earnings assets decreasing more rapidly than the Company’s average
balances in interest-bearing liabilities.  Average FHLB borrowings
were $33.6 million at an average cost of 4.12% for the three months ended June
30, 2008 compared average borrowings of $25.7 million at an average cost of
4.47% for the three months ended June 30, 2007.  The Company’s average
interest-earning assets shrunk to $236.4 million earning an average yield of
5.17% for the three months ended June 30, 2008 compared to average
interest-earnings assets of $255.9 million at an average yield of 5.51% for the
same period in 2007.  The Company’s average interest-bearing
liabilities shrunk to $214.0 million at a cost of 2.80% for the three months
ended June 30, 2008 compared to average interest-bearing liabilities of $225.1
million at a cost of 3.48% for the same period in 2007.  The lower
yield on interest-earning assets and lower cost of interest-bearing liabilities
is primarily due to lower short-term interest rates, which fell 225 basis points
since December 31, 2007.  Our net interest rate spread increased 34
basis points to 2.37% from 2.03% while our net interest margin increased 19
basis points to 2.64% from 2.45%.  The ratio of average
interest-earning assets to average interest-bearing liabilities decreased to
110.44% for the three months ended June 30, 2008 from 113.66% for the same
period in 2007.





There was
a $40,000 negative provision for loan losses for the three months ended June 30,
2008 and a $1,000 negative provision for loan losses for the three months ended
June 30, 2007.  There was $40,000 in loan loss recoveries during the
three months ended June 30, 2008 and $1,000 in loan loss recoveries during the
three months ended June 30, 2007.   Loan loss provisions are made
to maintain the allowance to reflect management’s estimate of losses inherent in
our loan portfolio.  Management concluded that no additional
provisions were necessary during the three months ended June 30, 2008 or
2007.  Should any unforeseen risks present themselves, management may
need to make provisions for loan losses.





Non-interest
income increased $27,000 or 16.1% to $195,000 for the quarter ended June 30,
2008 compared to $168,000 for the same quarter in 2007.  Insurance
commissions increased $9,000 to $14,000 for the quarter ended June 30, 2008
compared to $5,000 for the quarter ended June 30, 2007.  Insurance
commissions increased primarily due to an increase in the sale of fixed and
variable rate annuities during the quarter ended June 30, 2008 when compared to
the same period in 2007.  Other non-interest income increased $29,000
or 65.9% to $73,000 for the quarter ended June 30, 2008 compared to $44,000 for
the comparable period in 2007.  The increase was primarily due an
increase in the cash surrender value of the Company’s bank owned life insurance
(“BOLI”), offset by a decrease in rental income earned.  The cash
surrender value of the Company’s BOLI increased
$40,000 during the quarter ended June 30, 2008 while the rental income decreased
$13,000 during the quarter ended June 30, 2008, when compared to the same period
in 2007. The Company purchased $3.0 million of BOLI in August of
2007.  Rental income decreased due to increased vacancies in the
rental units located at our 80th Avenue
facility.





Non-interest
expense increased by $15,000 to $1.5 million for the comparative three months
ended June 30, 2008 and June 30, 2007.   The increase was
primarily due to an increase in advertising and promotion costs, offset by a
decrease in salaries and employee benefits.  Advertising and promotion
costs increased $24,000 or 39.3% to $85,000 for the quarter ended June 30, 2008
compared to $61,000 for the same period in 2007.  Advertising and
promotion costs increased for the comparable periods due to a budgeted reduction
in advertising costs that were incurred during the quarter ended June 30,
2007.  Salaries and employee benefits decreased $19,000 or 2.4% to
$775,000 for the quarter ended June 30, 2008 compared to $794,000 for the same
period in 2007.  Salaries and employee benefits decreased primarily
due to a reduction in the cost of the Company’s recognition and retention plan
(“RRP”).  The RRP plan was fully vested on May 21, 2008 and therefore,
the cost associated with the RRP is lower during the three months ended June 30,
2008 than the comparable period last year.  The average monthly cost
through May 21, 2008 to fund the RRP plan was $16,000.  On a going
forward basis the Company will not incur any compensation expense associated
with the fully vested RRP awards.





Our
federal and state taxes increased $10,000 to $99,000 for the quarter ended June
30, 2008 from $89,000 during the same period of 2007.  This is
primarily due to higher pre-tax income during the three months ended June 30,
2008 compared to the same period in 2007.  Federal and state income
tax expense as a percentage of income was 34.0% for the three months ended June
30, 2008 compared to 35.9% for the same period in 2007.  The decrease
in the percentage of federal and state taxes for the three months ended June 30,
2008 compared to the same period in the prior year is primarily the result of
the purchase of BOLI in August 2007.  The earnings recorded on BOLI
are federal and state tax exempt.





INCOME
INFORMATION – SIX MONTH PERIODS ENDED JUNE 30, 2008 AND 2007:





Net
interest income decreased by $145,000 or 4.5% to $3.1 million for the six months
ended June 30, 2008 from $3.2 million for the same period in
2007.  The decrease in net interest income reflects the Company’s
average balances of interest-earnings assets decreasing more rapidly than the
Company’s average balances in interest-bearing liabilities, as well as the
increased cost of FHLB borrowings due to the increase in the average balances of
FHLB advances.  Average FHLB advances were $31.3 million at a rate of
4.16% for the six months ended June 30, 2008 compared to average FHLB advance
balances of $26.9 million at a rate of 4.37% for the same period in
2007.  Average interest earning assets were $236.4 million and $256.8
million during the comparative 2008 and 2007 six-month periods while the average
yield was 5.28% and 5.53%, respectively.





Average
interest earning liabilities were $214.7 million and $225.9 million during the
comparative 2008 and 2007 six-month periods while the average cost was 2.97% and
3.45%, respectively.  Our net interest rate spread increased 23 basis
points to 2.31% from 2.08% while our net interest margin increased 9 basis
points to 2.59% from 2.50%.  The ratio of average interest-earning
assets to average interest-bearing liabilities decreased to 110.14% for the six
months ended June 30, 2008 from 113.69% for the same period in
2007.  The decrease in the yields and costs of the Company’s
interest-earning assets and interest-bearing liabilities is primarily due to
falling short-term interest during the six months ended June 30,
2008.





There was
a negative provision for loan losses of $40,000 for the six months ended June
30, 2008 compared to a $71,000 negative loan loss provision for the six months
ended June 30, 2007.  There was $40,000 in loan losses recoveries
during the six months ended June 30, 2008 and $21,000 in loan loss recoveries
and $50,000 in negative provisions during the six months ended June 30,
2007.  Any loan loss provisions made are to maintain the allowance to
reflect management’s estimate of losses inherent in our loan
portfolio.  Management concluded that no additional provisions were
necessary during the six months ended June 30, 2008 or
2007.  Management’s evaluation of the losses inherent in our loan
portfolio reflected a decrease risk of loss in the loan portfolio, resulting in
management’s decision to reduce the allowance for loan losses  for the
six months ended June 30, 2007.  Should any unforeseen risks present
themselves however, management may need to make a provision for loan losses in
the future.





Non-interest
income increased $17,000 or 4.7% to $377,000 for the six months ended June 30,
2008 from $360,000 for the comparable period in 2007.  The increase
was primarily the result of increases in insurance commission income and other
non-interest income, offset by a decrease in service charges on accounts for the
six months ended June 30, 2008 when compared to the six months ended June 30,
2007.  Other non-interest income increased $41,000 or 45.6% to
$131,000 for the six months ended June 30, 2008 compared to $90,000 for the six
months ended June 30, 2007.  The increase in other non-interest income
was primarily due an increase in the cash surrender value of the Company’s
bank-owned life insurance (“BOLI”), offset by a decrease in rental income
earned.  The Company purchased $3.0 million of BOLI in August of
2007.  Rental income decreased due to increased vacancies in the
rental units located at our 80th Avenue
facility.  Service charges on accounts decreased $29,000 or 11.9% to
$215,000 for the six months ended June 30, 2008 compared to $244,000 for the
same period in 2007.  The decrease in service charges on account was
primarily due to a $13,000 decrease in prepayment penalties collected and a
$17,000 decrease in service fees collected on checking accounts during the
comparable periods ended June 30, 2008 and 2007.  Service fees
collected decreased due to a decrease in the number of demand deposit accounts
the Company had at June 30, 2008 compared to June 30, 2007.  There
were 4,336 demand deposit accounts as of June 30, 2008 and 4,511 demand deposit
accounts as of June 30, 2007.


Non-interest
expense increased $86,000 to $3.1 million for the six-month period ended June
30, 2008 from $3.0 million for the comparable period in 2007.  The
increase was primarily due to an increase in data processing costs and other
non-interest expense items offset by a decrease in salaries and employee benefit
costs for the six months ended June 30, 2008 compared to the same period in
2007.  Data processing costs increased $21,000 or 12.5% to $189,000
for the six months ended June 30, 2008 compared to $168,000 for the same period
in 2007.  The increase in the comparable periods was primarily due to
credits received during the quarter ended March 31, 2007 given in conjunction
with negotiations on additional data services purchased.  Other
non-interest expense items increased $118,000 or 18.8% to $746,000 for the six
months ended June 30, 2008 compared to $628,000 for the six months ended June
30, 2007.  As discussed in detail in the securities paragraph in the
balance sheet data above, the increase in other non-interest expense items is
primarily due a $192,000 loss realized in conjunction with the sale of trading
securities in April 2008. The loss on the sale of trading securities was
offset by decreases in postage costs and professional fees. Salaries and
employee benefits decreased primarily due to a reduction in the cost of the
Company’s RRP as well as a reduction in the number of full time equivalent
employees for the comparable periods.  The RRP plan was fully vested
on May 21, 2008 and therefore, the cost associated with the RRP was lower during
the six months ended June 30, 2008 than the comparable period last
year.  The average monthly cost through May 21, 2008 to fund the RRP
plan was $16,000.





Our
federal and state taxes decreased $115,000 to $124,000 for the six months ended
June 30, 2008 from $239,000 in the same period of 2007.  This is
primarily the result of lower pre-tax income that occurred during the six months
ended June 30, 2008 as well as the purchase of BOLI in August
2007.  The earnings recorded on BOLI are federal and state tax
exempt.  Federal and state income tax expense as a percentage of
income was 30.7% for the six months ended June 30, 2008 compared to 36.8% for
the same period in 2007.





Other
financial information is included in the tables that follow.





This
press release contains certain “forward-looking statements” which may be
identified by the use of such words as “believe”, “expect”, “intend”,
“anticipate”,  “should”, “planned”, “estimated” and
“potential”.  Examples of forward-looking statements include, but are
not limited to, estimates with respect to our financial condition, results of
operations and business that are subject to various factors which could cause
actual results to differ materially from these estimates and most other
statements that are not historical in nature.  These factors include,
but are not limited to, general and local economic condition, changes in
interest rates, deposit flows, demand for mortgage and other loans, real estate
values, and competition; changes in accounting principles, policies or
guidelines; changes in legislation or regulation; and other economic,
competitive, governmental, regulatory, and technological factors affecting our
operations, pricing, products and services.





Contact:
            Lyn
      G. RupichPresident708-687-7400


AJS
      BANCORP, INC.CONSOLIDATED
      CONDENSED BALANCE SHEETSDollars
      in thousands (except per share data)(Unaudited)30-Jun-08
                
                
                31-Dec-07ASSETSCash
      and due from financial Institutions
                
                $
                17,074
                
                
                $
                18,296Federal
      funds sold
                
                
                58
                
                
                
                77TOTAL
      CASH AND CASH EQUIVALENTS
                
                
                17,132
                
                
                
                18,373Certificates
      of Deposit
                
                
                6,997
                
                
                
                2,997Securities
                
                
                76,998
                
                
                
                81,447Loans
      receivable net of allowance for loan lossof
      $1,399 at June 30, 2008, and $1,539 atDecember
      31, 2007.
                
                
                133,057
                
                
                
                132,966Federal
      Home Loan Bank Stock
                
                
                2,450
                
                
                
                2,450Premises
      and equipment
                
                
                4,307
                
                
                
                4,282Accrued
      interest receivable & other assets
                
                
                6,167
                
                
                
                5,834TOTAL
      ASSETS
                
                $
                247,108
                
                
                $
                248,349LIABILITIES
      AND SHAREHOLDERS' EQUITYDeposits
                
                
                179,722
                
                
                
                190,534Federal
      Home Loan Bank advances
                
                
                32,575
                
                
                
                23,350Advance
      payments by borrowers for taxesand
      insurance
                
                
                1,720
                
                
                
                1,551Accrued
      expenses and other liabilities
                
                
                4,597
                
                
                
                4,986TOTAL
      LIABILITIES
                
                
                218,614
                
                
                
                220,421TOTAL
      EQUITY
                
                
                28,494
                
                
                
                27,928TOTAL
      LIABILITIES AND SHAREHOLDERS'EQUITY
                
                $
                247,108
                
                
                $
                248,349
  30-Jun-08
                
                
                30-Jun-07INTEREST
      INCOME & DIVIDEND INCOMELoans,
      including fees
                
                $
                4,139
                
                
                $
                4,216Securities
                
                
                1,772
                
                
                
                1,739Interest
      earning deposits & other
                
                
                284
                
                
                
                1,020Federal
      funds sold
                
                
                52
                
                
                
                129TOTAL
      INTEREST INCOME
                
                
                6,247
                
                
                
                7,104INTEREST
      EXPENSE ON DEPOSITSDeposits
                
                
                2,538
                
                
                
                3,313Federal
      Home Loan Bank & Other
                
                
                650
                
                
                
                587Total
      Interest Expense
                
                
                3,188
                
                
                
                3,900NET
      INTEREST INCOME
                
                
                3,059
                
                
                
                3,204Provision
      for loan losses
                
                
                (40
                )
                
                
                (71
                )NET
      INTEREST INCOME AFTER PROVISIONFOR
      LOAN LOSSES
                
                
                3,099
                
                
                
                3,275NON-INTEREST
      INCOMEInsurance
      commissions
                
                
                31
                
                
                
                26Service
      charges on accounts
                
                
                215
                
                
                
                244Other
                
                
                131
                
                
                
                90TOTAL
      NON-INTEREST INCOME
                
                
                377
                
                
                
                360NON-INTEREST
      EXPENSESalaries
      and employee benefits
                
                
                1,575
                
                
                
                1,650Occupancy
                
                
                431
                
                
                
                405Advertising
      & promotion
                
                
                131
                
                
                
                135Data
      processing
                
                
                189
                
                
                
                168Other
                
                
                746
                
                
                
                628TOTAL
      NON-INTEREST EXPENSE
                
                
                3,072
                
                
                
                2,986INCOME
      BEFORE INCOME TAXES
                
                
                404
                
                
                
                649Income
      tax expense
                
                
                124
                
                
                
                239NET
      INCOME
                
                $
                280
                
                
                $
                410Earnings
      per share, basic
                
                $
                0.14
                
                
                $
                0.19Earnings
      per share, diluted
                
                $
                0.14
                
                
                $
                0.19
 AJS
      BANCORP, INC.CONSOLIDATED
      CONDENSED BALANCE SHEETSDollars
      in thousandsFor
      the Three months ended 6/30/08(unaudited)For
      the Three
                    
                    
                    For
      the ThreeMonths
      ended
                    
                    
                    Months
      ended6/30/2008
                    
                    
                    6/30/2007INTEREST
      INCOME & DIVIDEND INCOMELoans,
      including fees
                    
                    $
                    2,041
                    
                    
                    $
                    2,069Securities
                    
                    
                    863
                    
                    
                    
                    958Interest
      earning deposits & other
                    
                    
                    153
                    
                    
                    
                    455Federal
      Funds Sold
                    
                    
                    1
                    
                    
                    
                    44TOTAL
      INTEREST INCOME
                    
                    
                    3,058
                    
                    
                    
                    3,526INTEREST
      EXPENSE ON DEPOSITSDeposits
                    
                    
                    1,154
                    
                    
                    
                    1,673Federal
      Home Loan Bank & Other
                    
                    
                    346
                    
                    
                    
                    287Total
      Interest Expense
                    
                    
                    1,500
                    
                    
                    
                    1,960NET
      INTEREST INCOME
                    
                    
                    1,558
                    
                    
                    
                    1,566Provision
      for loan losses
                    
                    
                    (40
                    )
                    
                    
                    (1
                    )NET
      INTEREST INCOME AFTERPROVISION
      FOR LOAN LOSSES
                    
                    
                    1,598
                    
                    
                    
                    1,567NON-INTEREST
      INCOMEInsurance
      commissions
                    
                    
                    14
                    
                    
                    
                    5Service
      charges on deposit accounts
                    
                    
                    108
                    
                    
                    
                    119Other
                    
                    
                    73
                    
                    
                    
                    44TOTAL
      NON-INTEREST INCOME
                    
                    
                    195
                    
                    
                    
                    168NON-INTEREST
      EXPENSESalaries
      and employee benefits
                    
                    
                    775
                    
                    
                    
                    794Occupancy
                    
                    
                    212
                    
                    
                    
                    204Advertising
      & promotion
                    
                    
                    85
                    
                    
                    
                    61Data
      processing
                    
                    
                    90
                    
                    
                    
                    85Other
                    
                    
                    340
                    
                    
                    
                    343TOTAL
      NON-INTEREST EXPENSE
                    
                    
                    1,502
                    
                    
                    
                    1,487INCOME
      BEFORE INCOME TAXES
                    
                    
                    291
                    
                    
                    
                    248Income
      Tax Expense
                    
                    
                    99
                    
                    
                    
                    89NET
      INCOME
                    
                    $
                    192
                    
                    
                    $
                    159





AJS
      Bancorp, Inc.Financial
      Highlights(unaudited)
            
            June
      30, 2008
            
            
            December
      31, 2007Selected Financial
      Highlights:Total
      assets
            
            $
            247,108
            
            
            $
            248,349Loans
      receivable, net
            
            
            133,057
            
            
            
            132,966Securities
            
            
            76,998
            
            
            
            81,447Deposits
            
            
            179,722
            
            
            
            190,534Federal
      Home Loan Bank advances
            
            
            32,575
            
            
            
            23,350Stockholders'
      equity
            
            
            28,494
            
            
            
            27,928Book
      value per share (1)
            
            
            14.03
            
            
            
            13.71Number
      of shares outstanding (2)
            
            
            2,030,545
            
            
            
            2,036,872




Three
      months ended
            
            
            Three
      months endedJune
      30, 2008
            
            
            June
      30, 2007(In
      thousands except per share information)Selected Operations
      Data:Total
      interest income
            
            $
            3,058
            
            
            $
            3,526Total
      interest expense
            
            
            1,500
            
            
            
            1,960Net
      interest income
            
            
            1,558
            
            
            
            1,566Provision
      for loan losses
            
            
            (40
            )
            
            
            (1
            )Net
      interest income after provisionfor loan losses
            
            
            1,598
            
            
            
            1,567Noninterest
      income
            
            
            195
            
            
            
            168Noninterest
      expense
            
            
            1,502
            
            
            
            1,487Income
      before taxes
            
            
            291
            
            
            
            248Income
      tax provision
            
            
            99
            
            
            
            89Net
      income
            
            
            192
            
            
            
            159Basic
      earnings per share
            
            $
            0.09
            
            
            $
            0.08Diluted
      earnings per share
            
            $
            0.09
            
            
            $
            0.07




Three
      months ended
            
            
            Three
      months endedJune
      30, 2008
            
            
            June
      30, 2007Selected Operating
      Ratios:Return
      on average assets
            
            
            0.31
            %
            
            
            0.24
            %Return
      on average equity
            
            
            2.67
            %
            
            
            2.19
            %Interest
      rate spread during the period
            
            
            2.37
            %
            
            
            2.03
            %Net
      interest margin
            
            
            2.64
            %
            
            
            2.45
            %Average
      interest-earning assets to average interest-bearing
      liabilities
            
            
            110.44
            %
            
            
            113.66
            %Efficiency
      ratio (3)
            
            
            85.68
            %
            
            
            85.76
            %




Six
      months ended
            
            
            Six
      months endedJune
      30, 2008
            
            
            June
      30, 2007(In
      thousands except per share information)Selected Operations
      Data:Total
      interest income
            
            $
            6,247
            
            
            $
            7,104Total
      interest expense
            
            
            3,188
            
            
            
            3,900Net
      interest income
            
            
            3,059
            
            
            
            3,204Provision
      for loan losses
            
            
            (40
            )
            
            
            (71
            )Net
      interest income after provisionfor loan losses
            
            
            3,099
            
            
            
            3,275Noninterest
      income
            
            
            377
            
            
            
            360Noninterest
      expense
            
            
            3,072
            
            
            
            2,986Income
      before taxes
            
            
            404
            
            
            
            649Income
      tax provision
            
            
            124
            
            
            
            239Net
      income
            
            
            280
            
            
            
            410Earnings
      per share, basic
            
            $
            0.14
            
            
            $
            0.19Earnings
      per share, diluted
            
            $
            0.14
            
            
            $
            0.19




Six
      months ended
            
            
            Six
      months endedJune
      30, 2007
            
            
            June
      30, 2007Selected Operating
      Ratios:Return
      on average assets
            
            
            0.22
            %
            
            
            0.31
            %Return
      on average equity
            
            
            1.96
            %
            
            
            2.83
            %Interest
      rate spread during the period
            
            
            2.31
            %
            
            
            2.08
            %Net
      interest margin
            
            
            2.59
            %
            
            
            2.50
            %Average
      interest-earning assets to average interest-bearing
      liabilities
            
            
            110.14
            %
            
            
            113.69
            %Efficiency
      ratio (3)
            
            
            89.41
            %
            
            
            83.78
            %




As
      of
            
            
            As
      ofJune 30,
      2008
            
            
            December 31,
      2007Asset Quality
      Ratios:Non-performing
      assets to total assets
            
            
            0.25
            %
            
            
            0.38
            %Allowance
      for loan losses to non-performing loans
            
            
            225.65
            %
            
            
            164.78
            %Allowance
      for loan losses to loans receivable, gross
            
            
            1.04
            %
            
            
            1.15
            %


(1)Shareholders' equity divided by number of shares
      outstanding.(2)Total shares issued, less unearned ESOP shares, and treasury
      shares.(3)
      Non-interest expense divided by the sum of net interest income and
      non-interest income.