For
Immediate Release


February
23, 2009








AJS
BANCORP, INC. ANNOUNCES FOURTH QUARTER RESULTS.





AJS
Bancorp, Inc. (OTCBB; AJSB.OB), the holding company for A.J. Smith Federal
Savings Bank, Midlothian, Illinois today reported a consolidated net loss of
$2.5 million for the quarter ended December 31, 2008 as compared to a
consolidated net loss of $96,000 for the same quarter in 2007.  Basic
and diluted loss per share were $1.24 for the quarter ended December 31, 2008
compared to a basic and diluted loss of $0.05 per share for the quarter ended
December 31, 2007.  The larger net loss during the quarter primarily
reflects an increase in the provision for loan losses and a decrease in
non-interest income partially offset by a decrease in non-interest
expense.  Net loss for the year ended December 31, 2008 was $2.1
million compared to net income of $559,000 for the year ended December 31,
2007.  Basic and diluted loss was $1.02 per share for the year ended
December 31, 2008 compared to basic earnings per share of $0.27 and diluted
earnings per share of $0.26 for the year ended December 31, 2007. As discussed
in more detail below, the net loss in 2008 compared with net income in 2007
primarily reflects an increase in the provision for loan losses, a decrease in
net interest income, and a decrease in non-interest income, offset by a decrease
in non-interest expense.  All information except at, and for, the year
ended December 31, 2007 is unaudited.





As
previously announced, the Company’s Board of Directors has declared a quarterly
dividend of $0.11 cents per share. The dividend is payable on February 27, 2009,
to stockholders of record on February 13, 2009.  AJS Bancorp, MHC (the
“MHC”) intends to waive 100% of the quarterly dividend due on its 1,227,554
shares and has received regulatory non-objection to do so.  At
December 31, 2008, the Company held cash totaling $7.4 million.  At
December 31, 2008 the Bank’s tier 1 capital ratio as well as its tangible
capital ratio was 10.2%, and its risk-based capital ratio was
22.5%.





Total
consolidated assets as of December 31, 2008 were $244.0 million, a decrease of
$4.4 million or 1.8% from $248.3 million at December 31, 2007.  The
decrease was primarily due to a decrease in cash and cash equivalents and loans
receivable, partially offset by an increase in certificates of deposits at other
financial institutions and securities.  Loans receivable decreased
$6.6 million or 4.9% to $126.4 million at December 31, 2008 from $133.0 million
at December 31, 2007.  The decrease in loans was primarily due to
payoffs and more stringent underwriting and credit standards in the commercial
and home equity loan categories, reflecting management’s decision to be more
conservative in its loan originations during the severe economic
downturn.  Certificates of deposit increased $3.8 million or 126.8% to
$6.8 million at December 31, 2008 from $3.0 million at December 31,
2007.  The Company invested $4.0 million during the first quarter of
2008 in certificates of deposit at other financial institutions.  The
certificates were invested in maximum increments of $100,000 with yields ranging
from 3.25% to 3.40% and maturities ranging from nine months to three
years.  Securities increased $8.4 million or 10.4% to $89.9 million at
December 31, 2008 from $81.4 million at December 31, 2007.  The
increase in securities primarily reflects purchases of $13.0 million of
fixed-rate government-backed notes and bonds, of which $10.0
million





had call
features, and $36.2 million in mortgage-backed securities. The average term to
maturity of the fixed-rate note and bond securities was 90 months; the average
term to maturity of the mortgage-backed securities was 114 months.





Total
liabilities decreased $3.5 million or 1.6% to $216.9 million from $220.4 million
primarily due to a decrease in deposits partially offset by an increase in
Federal Home Loan Bank Advances (“FHLB”).  Deposits decreased $10.2
million to $180.3 million at December 31, 2008 from $190.5 million at December
31, 2007 while FHLB advances increased $6.8 million to $30.2 million at December
31, 2008 from $23.4 million at December 31, 2007.  The decrease in
deposits occurred in the certificates of deposit category, while the balances of
passbook and money market accounts both increased.  The Bank borrowed
$13.8 million in fixed rate advances from the FHLB during 2008.  The
advances had maturities of two to five years with a weighted average cost of
3.3%.





The
Company had non-performing assets of $4.5 million as of December 31, 2008 and
$934,000 as of December 31, 2007.  The increase in non-performing
assets resulted mainly from an increase in non-performing commercial real estate
loans.  The allowance for loan losses totaled $2.7 million at December
31, 2008 and $1.5 million at December 31, 2007.  This represents a
ratio of the allowance for loan losses to gross loans receivable of 2.12% at
December 31, 2008 and 1.15% at December 31, 2007.





The
Company has six single-family loans on non-accrual status, one of which is also
impaired, as of December 31, 2008.  The Company has two commercial
lending relationships with principal balances in excess of $500,000 that are
impaired and on non-accrual as of December 31, 2008.  Additionally,
the Company has five commercial lending relationships that are impaired, but are
not more than 90 days delinquent at December 31, 2008, two of which have
principal balances in excess of $500,000.  The following paragraphs
detail further information on the large commercial loans.  The Company
has no large single family or other loans that are impaired or more than 90 days
delinquent as of December 31, 2008.





The
Company has a $4.0 million participation interest in a $26.2 million loan
secured by vacant land that the borrower intended to develop into a
residential/commercial site.  The borrower defaulted on the loan and
the property is now in foreclosure proceedings.  The lead lender
conducted an appraisal of the property in the fourth quarter of 2008 that
reflects a range of fair values based upon city zoning and the retention of the
property’s tax incentive (“TIF”) status.  Based on the appraisal and
consideration of all known facts, the Company has charged off $2.3 million of
the outstanding loan balance at December 31, 2008.





The
Company has three mortgage loans to one borrower totaling $2.7 million secured
by two retail office space commercial buildings.  The borrower
defaulted on these mortgage loans, therefore the properties are currently in
foreclosure proceedings. During the fourth quarter, management obtained updated
appraisals on these properties.  Based on deterioration in fair
values, as detailed in the appraisal, the Company charged off $957,000 of the
outstanding loan balance as of December 31, 2008.





The
Company has a $3.0 million or 3.3% participation in a $91.5 million loan secured
by an indoor water park.  Though the borrower continued to pay
interest through December





2008,
they previously indicated that they were in financial difficulty and wanted to
restructure the interest-only loan.  Several troubled debt
restructuring options have been presented; however, the most recent plans have
not been accepted.  Due to negative cash flows and identified concerns
with the borrower, the Company has recorded a $600,000 impairment reserve on
this property as of December 31, 2008.





The
Company has a $2.9 million mortgage loan on a 46 unit apartment building in
Chicago that is deemed to be impaired, but in which the borrower is current in
its payments as of December 31, 2008.  The borrower had experienced
financial difficulty and requested the loan be restructured in the fourth
quarter of 2008.  The Company restructured the interest rate on the
loan and obtained an appraisal on the property in December of
2008.  Accordingly, the Company has recorded a $600,000 impairment
reserve on this property as of December 31, 2008.





While
these properties are in the midst of foreclosure or possible restructuring there
is no guarantee that the fair value of the properties will not decline
further.  Therefore, although the Company recorded its best estimate
of probable losses expected at December 31, 2008, there may be additional losses
on these properties in the future.





Total
stockholders’ equity decreased $831,000 to $27.1 million at December 31, 2008
from $27.9 million at December 31, 2007.  The decrease in
stockholders’ equity primarily resulted from the net loss of $2.1 million during
the twelve months ended December 31, 2008 and the repurchase of shares of the
Company’s stock during the twelve months ended December 31, 2008, offset by an
increase in other comprehensive income due to the increased fair value of the
available for sale securities portfolio.  The Company repurchased
11,239 shares of its common stock at a cost of $197,000 during the twelve months
ended December 31, 2008.  In addition, during the year the Company
declared and paid four quarterly dividends of $0.11 cents per share, and one
special dividend of $0.50 per share.  With the non-objection of the
Office of Thrift Supervision (“OTS”) AJS Bancorp, MHC (the “MHC”) waived 100% of
the dividends due on its 1,227,544 shares.  The fair value, net of
taxes, of the available for sale securities portfolio increased $1.5 million at
December 31, 2008 compared to a tax effective increase in fair value of $695,000
at December 31, 2007.





INCOME
INFORMATION – THREE MONTH PERIODS ENDED DECEMBER 31, 2008 AND 2007:





Net
interest income increased by $11,000 or 0.8% to $1.5 million for the quarter
ended December 31, 2008 when compared to the same quarter in
2007.  The increase in net interest income was primarily due to the
cost of the average outstanding interest-bearing liabilities decreasing at a
faster pace than the yields decreased on the average outstanding
interest-earning assets.  The average interest-earning assets to
average interest-bearing liabilities increased to 109.60% for the three months
ended December 31, 2008 compared to 109.38% for the three months ended December
31, 2007.  Average interest earning assets were $231.1 million and
$236.8 million during the comparative 2008 and 2007 quarters while the average
yield was 4.86% and 5.60%, respectively.  Average interest-bearing
liabilities were $210.8 million and $216.5 million during the comparative 2008
and 2007 quarters while the average cost was 2.55% for the three months ended
December 31, 2008 compared to 3.43% for the same period in 2007.  Our
net interest rate





spread
increased 15 basis points to 2.32% from 2.17% while our net interest margin
increased 8 basis points to 2.54% from 2.46%.





The
Company recorded $4.3 million in provisions for loan losses during the three
months ended December 31, 2008, compared to $250,000 in provisions for loan
losses recorded for the three months ended December 31, 2007.  The
loan loss provision made for the three months ended December 31, 2008 were
based, in part, on the continuation of negative economic trends, as well as,
charge-offs and impairment reserves recorded on commercial loan
properties.  The Company recorded $3.0 million in charge-offs on
commercial loans during the three months ended December 31,
2008.  These loans and the properties securing these loans are
discussed in-depth in the preceding paragraphs.  The Company had a
2.12% allowance for loan loss to gross loans receivable at December 31, 2008
compared to 1.15% allowance for loan loss to gross loans receivable at December
31, 2007.  At December 31, 2008 the FAS 5 portion of the allowance was
1.08%, whereas at December 31, 2007 the FAS 5 portion of the allowance was
1.15%.  Based on economic and real estate downturns and with
consideration to the increase in Company charge offs, the Company has increased
its FAS 5 general reserve allocations.  The comparative year over year
decrease in the FAS 5 general reserve is the result of $10.3 million of loans
that were included in the FAS 5 general reserve at December 31, 2007 that are
now specifically evaluated for impairment under FAS 114.  Had these
loans remained in the FAS 5 general reserve at December 31, 2008, the FAS 5
general reserve to gross loans would have been 0.15% higher, or
1.23%.  Any loan loss provisions made are to maintain the allowance at
levels that reflect management’s estimate of known and inherent losses in our
loan portfolio.





Non-interest
income decreased $75,000 to $171,000 for the quarter ended December 31, 2008
from $246,000 for the comparable quarter in 2007.  Insurance
commission income decreased $36,000 or 92.3% for the three months ended December
31, 2008 when compared to the same period in 2007.  Insurance
commissions decreased primarily due to a decrease in the sale of fixed and
variable rate annuities for the comparable quarters as investors avoided most
non-insured financial market instruments.  Service charges on accounts
decreased $49,000 or 35.5% to $89,000 for the quarter ended December 31, 2008
compared to $138,000 for the comparative quarter in 2007.  The
decrease in service charges primarily reflects a decrease in prepayment
penalties and late fees paid during the quarter ended December 31, 2008 compared
to the same quarter in 2007.  Other non-interest income increased
$10,000 or 14.5% to $79,000 for the quarter ended December 31, 2008 compared to
$69,000 for the comparative quarter in 2007.  The increase was
primarily due an increase in rental income for the comparative
quarters.





Non-interest
expense decreased $195,000 or 11.9% to $1.4 million for the quarter ended
December 31, 2008 from $1.6 million for the comparable period in
2007.  The decrease primarily reflects decreases in salaries and
employee benefits and other non-interest expense, offset by an increase in
occupancy expense.  Salaries and employee benefits decreased $76,000
or 9.4% to $733,000 for the quarter ended December 31, 2008 compared to $809,000
for the same period last year.  Salaries and employee benefits
decreased primarily due to a reduction in the cost of the recognition and
retention and stock option plans.  The awards under these plans were
fully vested as of May 21, 2008, and accordingly, the benefit expense decreased
$65,000 for the comparable periods.  Other non-interest expense
decreased $188,000 or 37.1% to $319,000 for the quarter





ended
December 31, 2008 compared to $507,000 for the same period in
2007.  The decrease in other non-interest expense items is primarily
due a $233,000 other than temporary impairment charge associated with a mutual
fund that was incurred in the fourth quarter of 2007.  The Company
sold this mutual fund in April of 2008 to avoid expected further declines in
fair value, which did occur.  Occupancy expense increased $51,000 or
32.5% to $208,000 for the quarter ended December 31, 2008 compared to $157,000
for the same quarter in 2007.  The increase reflects the Company’s
successful appeal of the real estate tax assessment and the resulting refund of
real estate taxes received during the quarter ended December 31,
2007.





Our
federal and state tax benefit increased $1.5 million to $1.6 million for the
quarter ended December 31, 2008 from a tax benefit of $90,000 during the same
period of 2007.  This is primarily due to lower pre-tax loss during
the period.





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. Rupich


President


708-687-7400

















AJS
      BANCORP, INC.CONSOLIDATED
      CONDENSED BALANCE SHEETSDollars
      in thousands (except per share data)(Unaudited)31-Dec-08
                          
                          
                          31-Dec-07ASSETSCash
      and due from financial Institutions
                          
                          $
                          7,335
                          
                          
                          $
                          18,296Federal
      funds sold
                          
                          
                          58
                          
                          
                          
                          77TOTAL
      CASH AND CASH EQUIVALENTS
                          
                          
                          7,393
                          
                          
                          
                          18,373Certificates
      of Deposit
                          
                          
                          6,797
                          
                          
                          
                          2,997Securities
                          
                          
                          89,876
                          
                          
                          
                          81,447Loans
      receivable net of allowance for loan lossof
      $2,734 at December 31, 2008, and $1,539 atDecember
      31, 2007.
                          
                          
                          126,395
                          
                          
                          
                          132,966Federal
      Home Loan Bank Stock
                          
                          
                          2,450
                          
                          
                          
                          2,450Premises
      and equipment
                          
                          
                          4,262
                          
                          
                          
                          4,282Accrued
      interest receivable & other assets
                          
                          
                          6,797
                          
                          
                          
                          5,834TOTAL
      ASSETS
                          
                          $
                          243,970
                          
                          
                          $
                          248,349LIABILITIES
      AND SHAREHOLDERS' EQUITYDeposits
                          
                          
                          180,291
                          
                          
                          
                          190,534Federal
      Home Loan Bank advances
                          
                          
                          30,175
                          
                          
                          
                          23,350Advance
      payments by borrowers for taxesand
      insurance
                          
                          
                          1,502
                          
                          
                          
                          1,551Accrued
      expenses and other liabilities
                          
                          
                          4,905
                          
                          
                          
                          4,986TOTAL
      LIABILITIES
                          
                          
                          216,873
                          
                          
                          
                          220,421TOTAL
      EQUITY
                          
                          
                          27,097
                          
                          
                          
                          27,928TOTAL
      LIABILITIES AND SHAREHOLDERS'EQUITY
                          
                          $
                          243,970
                          
                          
                          $
                          248,349
  31-Dec-08
                          
                          
                          31-Dec-07INTEREST
      INCOME & DIVIDEND INCOMELoans,
      including fees
                          
                          $
                          7,737
                          
                          
                          $
                          8,492Securities
                          
                          
                          3,762
                          
                          
                          
                          3,791Interest
      earning deposits & other
                          
                          
                          447
                          
                          
                          
                          1,458Federal
      funds sold
                          
                          
                          53
                          
                          
                          
                          149TOTAL
      INTEREST INCOME
                          
                          
                          11,999
                          
                          
                          
                          13,890INTEREST
      EXPENSE ON DEPOSITSDeposits
                          
                          
                          4,635
                          
                          
                          
                          6,561Federal
      Home Loan Bank & Other
                          
                          
                          1,299
                          
                          
                          
                          1,139Total
      Interest Expense
                          
                          
                          5,934
                          
                          
                          
                          7,700NET
      INTEREST INCOME
                          
                          
                          6,065
                          
                          
                          
                          6,190Provision
      for loan losses
                          
                          
                          4,328
                          
                          
                          
                          179NET
      INTEREST INCOME AFTERPROVISION
      FOR LOAN LOSSES
                          
                          
                          1,737
                          
                          
                          
                          6,011NON-INTEREST
      INCOMEInsurance
      commissions
                          
                          
                          54
                          
                          
                          
                          143Service
      charges on accounts
                          
                          
                          410
                          
                          
                          
                          497Other
                          
                          
                          301
                          
                          
                          
                          218TOTAL
      NON-INTEREST INCOME
                          
                          
                          765
                          
                          
                          
                          858NON-INTEREST
      EXPENSESalaries
      and employee benefits
                          
                          
                          3,110
                          
                          
                          
                          3,255Occupancy
                          
                          
                          849
                          
                          
                          
                          779Advertising
      & promotion
                          
                          
                          282
                          
                          
                          
                          271Data
      processing
                          
                          
                          375
                          
                          
                          
                          342Other
                          
                          
                          1,364
                          
                          
                          
                          1,388TOTAL
      NON-INTEREST EXPENSE
                          
                          
                          5,980
                          
                          
                          
                          6,035INCOME
      (LOSS) BEFORE INCOME TAXES
                          
                          
                          (3,478
                          )
                          
                          
                          834Income
      tax expense
                          
                          
                          (1,407
                          )
                          
                          
                          275NET
      INCOME (LOSS)
                          
                          $
                          (2,071
                          )
                          
                          $
                          559Earnings
      (loss) per share, basic
                          
                          $
                          (1.02
                          )
                          
                          $
                          0.27Earnings
      (loss) per share, diluted
                          
                          $
                          (1.02
                          )
                          
                          $
                          0.26







AJS
      BANCORP, INC.CONSOLIDATED
      CONDENSED BALANCE SHEETSDollars
      in thousandsFor
      the Three months ended 12/31/08For
      the Three
                          
                          
                          For
      the ThreeMonths
      ended
                          
                          
                          Months
      ended12/31/2008
                          
                          
                          12/31/2007INTEREST
      INCOME & DIVIDEND INCOMELoans,
      including fees
                          
                          $
                          1,713
                          
                          
                          $
                          2,148Securities
                          
                          
                          1,028
                          
                          
                          
                          995Interest
      earning deposits & other
                          
                          
                          68
                          
                          
                          
                          171Federal
      Funds Sold
                          
                          
                          0
                          
                          
                          
                          0TOTAL
      INTEREST INCOME
                          
                          
                          2,809
                          
                          
                          
                          3,314INTEREST
      EXPENSE ON DEPOSITSDeposits
                          
                          
                          1,023
                          
                          
                          
                          1,587Federal
      Home Loan Bank & Other
                          
                          
                          319
                          
                          
                          
                          271Total
      Interest Expense
                          
                          
                          1,342
                          
                          
                          
                          1,858NET
      INTEREST INCOME
                          
                          
                          1,467
                          
                          
                          
                          1,456Provision
      for loan losses
                          
                          
                          4,315
                          
                          
                          
                          250NET
      INTEREST INCOME (LOSS) AFTERPROVISION
      FOR LOAN LOSSES
                          
                          
                          (2,848
                          )
                          
                          
                          1,206NON-INTEREST
      INCOMEInsurance
      commissions
                          
                          
                          3
                          
                          
                          
                          39Service
      charges on deposit accounts
                          
                          
                          89
                          
                          
                          
                          138Other
                          
                          
                          79
                          
                          
                          
                          69TOTAL
      NON-INTEREST INCOME
                          
                          
                          171
                          
                          
                          
                          246NON-INTEREST
      EXPENSESalaries
      and employee benefits
                          
                          
                          733
                          
                          
                          
                          809Occupancy
                          
                          
                          208
                          
                          
                          
                          157Advertising
      & promotion
                          
                          
                          86
                          
                          
                          
                          78Data
      processing
                          
                          
                          97
                          
                          
                          
                          87Other
                          
                          
                          319
                          
                          
                          
                          507TOTAL
      NON-INTEREST EXPENSE
                          
                          
                          1,443
                          
                          
                          
                          1,638LOSS
      BEFORE INCOME TAXES
                          
                          
                          (4,120
                          )
                          
                          
                          (186
                          )Income
      Tax Expense
                          
                          
                          (1,596
                          )
                          
                          
                          (90
                          )NET
      LOSS
                          
                          $
                          (2,524
                          )
                          
                          $
                          (96
                          )









AJS
      Bancorp, Inc.Financial
      Highlights(unaudited)
                                                                                      
                                                                                      December
      31, 2008
                                                                                      
                                                                                      
                                                                                      December
      31, 2007(In
      thousands)Selected Financial
      Highlights:Total
      assets
                                                                                      
                                                                                      $
                                                                                      243,970
                                                                                      
                                                                                      
                                                                                      $
                                                                                      248,349Loans
      receivable, net
                                                                                      
                                                                                      
                                                                                      126,395
                                                                                      
                                                                                      
                                                                                      
                                                                                      132,966Securities
                                                                                      
                                                                                      
                                                                                      89,876
                                                                                      
                                                                                      
                                                                                      
                                                                                      81,447Deposits
                                                                                      
                                                                                      
                                                                                      180,291
                                                                                      
                                                                                      
                                                                                      
                                                                                      190,534Federal
      Home Loan Bank advances
                                                                                      
                                                                                      
                                                                                      30,175
                                                                                      
                                                                                      
                                                                                      
                                                                                      23,350Stockholders'
      equity
                                                                                      
                                                                                      
                                                                                      27,097
                                                                                      
                                                                                      
                                                                                      
                                                                                      27,928Book
      value per share (1)
                                                                                      
                                                                                      
                                                                                      13.38
                                                                                      
                                                                                      
                                                                                      
                                                                                      13.71Number
      of shares outstanding (2)
                                                                                      
                                                                                      
                                                                                      2,025,633
                                                                                      
                                                                                      
                                                                                      
                                                                                      2,134,304Three
      months ended
                                                                                      
                                                                                      
                                                                                      Three
      months endedDecember
      31, 2008
                                                                                      
                                                                                      
                                                                                      December
      31, 2007(In
      thousands except per share information)Selected Operations
      Data:Total
      interest income
                                                                                      
                                                                                      $
                                                                                      2,809
                                                                                      
                                                                                      
                                                                                      $
                                                                                      3,314Total
      interest expense
                                                                                      
                                                                                      
                                                                                      1,342
                                                                                      
                                                                                      
                                                                                      
                                                                                      1,858Net
      interest income
                                                                                      
                                                                                      
                                                                                      1,467
                                                                                      
                                                                                      
                                                                                      
                                                                                      1,456Provision
      for loan losses
                                                                                      
                                                                                      
                                                                                      4,315
                                                                                      
                                                                                      
                                                                                      
                                                                                      250Net
      interest income (loss) after provisionfor
      loan losses
                                                                                      
                                                                                      
                                                                                      (2,848
                                                                                      )
                                                                                      
                                                                                      
                                                                                      1,206Noninterest
      income
                                                                                      
                                                                                      
                                                                                      171
                                                                                      
                                                                                      
                                                                                      
                                                                                      246Noninterest
      expense
                                                                                      
                                                                                      
                                                                                      1,443
                                                                                      
                                                                                      
                                                                                      
                                                                                      1,638Income
      (loss) before taxes
                                                                                      
                                                                                      
                                                                                      (4,120
                                                                                      )
                                                                                      
                                                                                      
                                                                                      (186
                                                                                      )Income
      tax provision
                                                                                      
                                                                                      
                                                                                      (1,596
                                                                                      )
                                                                                      
                                                                                      
                                                                                      (90
                                                                                      )Net
      income (loss)
                                                                                      
                                                                                      
                                                                                      (2,524
                                                                                      )
                                                                                      
                                                                                      
                                                                                      (96
                                                                                      )Basic
      loss per share
                                                                                      
                                                                                      
                                                                                      (1.24
                                                                                      )
                                                                                      
                                                                                      $
                                                                                      (0.05
                                                                                      )Diluted
      loss per share
                                                                                      
                                                                                      
                                                                                      (1.24
                                                                                      )
                                                                                      
                                                                                      $
                                                                                      (0.05
                                                                                      )Three
      months ended
                                                                                      
                                                                                      
                                                                                      Three
      months endedDecember
      31, 2008
                                                                                      
                                                                                      
                                                                                      December
      31, 2007Selected Operating
      Ratios:Return
      on average assets
                                                                                      
                                                                                      
                                                                                      -4.10
                                                                                      %
                                                                                      
                                                                                      
                                                                                      -0.15
                                                                                      %Return
      on average equity
                                                                                      
                                                                                      
                                                                                      -35.90
                                                                                      %
                                                                                      
                                                                                      
                                                                                      -1.33
                                                                                      %Interest
      rate spread during the period
                                                                                      
                                                                                      
                                                                                      2.32
                                                                                      %
                                                                                      
                                                                                      
                                                                                      2.17
                                                                                      %Net
      interest margin
                                                                                      
                                                                                      
                                                                                      2.54
                                                                                      %
                                                                                      
                                                                                      
                                                                                      2.46
                                                                                      %Average
      interest-earning assets to average interest-bearing
      liabilities
                                                                                      
                                                                                      
                                                                                      109.60
                                                                                      %
                                                                                      
                                                                                      
                                                                                      109.38
                                                                                      %Efficiency
      ratio (3)
                                                                                      
                                                                                      
                                                                                      88.10
                                                                                      %
                                                                                      
                                                                                      
                                                                                      96.24
                                                                                      %Twelve
      months ended
                                                                                      
                                                                                      
                                                                                      Twelve
      months endedDecember
      31, 2008
                                                                                      
                                                                                      
                                                                                      December
      31, 2007(In
      thousands except per share information)Selected Operations
      Data:Total
      interest income
                                                                                      
                                                                                      $
                                                                                      11,999
                                                                                      
                                                                                      
                                                                                      $
                                                                                      13,890Total
      interest expense
                                                                                      
                                                                                      
                                                                                      5,934
                                                                                      
                                                                                      
                                                                                      
                                                                                      7,700Net
      interest income
                                                                                      
                                                                                      
                                                                                      6,065
                                                                                      
                                                                                      
                                                                                      
                                                                                      6,190Provision
      for loan losses
                                                                                      
                                                                                      
                                                                                      4,328
                                                                                      
                                                                                      
                                                                                      
                                                                                      179Net
      interest income after provisionfor
      loan losses
                                                                                      
                                                                                      
                                                                                      1,737
                                                                                      
                                                                                      
                                                                                      
                                                                                      6,011Noninterest
      income
                                                                                      
                                                                                      
                                                                                      765
                                                                                      
                                                                                      
                                                                                      
                                                                                      858Noninterest
      expense
                                                                                      
                                                                                      
                                                                                      5,980
                                                                                      
                                                                                      
                                                                                      
                                                                                      6,035Income
      (loss) before taxes
                                                                                      
                                                                                      
                                                                                      (3,478
                                                                                      )
                                                                                      
                                                                                      
                                                                                      834Income
      tax provision
                                                                                      
                                                                                      
                                                                                      (1,407
                                                                                      )
                                                                                      
                                                                                      
                                                                                      275Net
      income (loss)
                                                                                      
                                                                                      
                                                                                      (2,071
                                                                                      )
                                                                                      
                                                                                      
                                                                                      559Earnings
      (loss) per share, basic
                                                                                      
                                                                                      $
                                                                                      (1.02
                                                                                      )
                                                                                      
                                                                                      $
                                                                                      0.27Earnings
      (loss) per share, diluted
                                                                                      
                                                                                      $
                                                                                      (1.02
                                                                                      )
                                                                                      
                                                                                      $
                                                                                      0.26Twelve
      months ended
                                                                                      
                                                                                      
                                                                                      Twelve
      months endedDecember
      31, 2008
                                                                                      
                                                                                      
                                                                                      December
      31, 2007Selected Operating
      Ratios:Return
      on average assets
                                                                                      
                                                                                      
                                                                                      -0.83
                                                                                      %
                                                                                      
                                                                                      
                                                                                      0.22
                                                                                      %Return
      on average equity
                                                                                      
                                                                                      
                                                                                      -7.31
                                                                                      %
                                                                                      
                                                                                      
                                                                                      1.94
                                                                                      %Interest
      rate spread during the period
                                                                                      
                                                                                      
                                                                                      2.34
                                                                                      %
                                                                                      
                                                                                      
                                                                                      2.11
                                                                                      %Net
      interest margin
                                                                                      
                                                                                      
                                                                                      2.59
                                                                                      %
                                                                                      
                                                                                      
                                                                                      2.48
                                                                                      %Average
      interest-earning assets to average interest-bearing
      liabilities
                                                                                      
                                                                                      
                                                                                      109.88
                                                                                      %
                                                                                      
                                                                                      
                                                                                      112.24
                                                                                      %Efficiency
      ratio (3)
                                                                                      
                                                                                      
                                                                                      87.55
                                                                                      %
                                                                                      
                                                                                      
                                                                                      85.63
                                                                                      %As
      of
                                                                                      
                                                                                      
                                                                                      As
      ofDecember 31,
      2008
                                                                                      
                                                                                      
                                                                                      December 31,
      2007Asset Quality
      Ratios:Non-performing
      assets to total assets
                                                                                      
                                                                                      
                                                                                      1.86
                                                                                      %
                                                                                      
                                                                                      
                                                                                      0.38
                                                                                      %Allowance
      for loan losses to non-performing loans
                                                                                      
                                                                                      
                                                                                      60.25
                                                                                      %
                                                                                      
                                                                                      
                                                                                      164.78
                                                                                      %Allowance
      for loan losses to loans receivable, gross
                                                                                      
                                                                                      
                                                                                      2.12
                                                                                      %
                                                                                      
                                                                                      
                                                                                      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.