================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                 FORM 10-KSB/A-1
                                (Amendment No. 1)

(Mark One):
[X]  ANNUAL REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES  EXCHANGE ACT OF
     1934

For the fiscal year ended June 30, 2004.
                                       OR

[_]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE ACT
     OF 1934

For the transition period from                 to                .
                               ---------------    ---------------

                         Commission File Number: 0-25854
                                                 -------

                               GFSB BANCORP, INC.
                 ----------------------------------------------
                 (Name of Small Business Issuer in its Charter)

         Delaware                                        04-2095007
----------------------------                ------------------------------------
(State or Other Jurisdiction                (I.R.S. Employer Identification No.)
of Incorporation or Organization)

221 West Aztec Avenue, Gallup, New Mexico                     87301
------------------------------------------                ------------
(Address of Principal Executive Offices)                   (Zip Code)

                    Issuer's Telephone Number: (505) 722-4361
                                               --------------

       Securities Registered Under Section 12(b) of the Exchange Act: None
                                                                      ----

         Securities Registered Under Section 12(g) of the Exchange Act:

                     Common Stock, par value $0.10 per share
                     ---------------------------------------
                                (Title of Class)

         Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing requirements for the past 90 days. YES X  NO   .
                                                                      ---   ---

         Check if there is no  disclosure  of  delinquent  filers in response to
Item 405 of Regulation S-B is not contained in this form, and no disclosure will
be contained,  to the best of  registrant's  knowledge,  in definitive  proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [X]

         State issuer's revenues for its most recent fiscal year:  $12,981,533
                                                                   -----------

         The aggregate  market value of the voting and non-voting  common equity
held by  non-affiliates  of the registrant,  based on the average of the bid and
asked price for the  registrant's  Common Stock on the Nasdaq SmallCap Market at
September 15, 2004, was  $11,348,682.  Solely for purposes of this  calculation,
the  term  "affiliate"  refers  to  directors  and  executive  officers  and the
beneficial owners of more than 10% of the issuer's Common Stock.

         As of September 15, 2004,  there were issued and outstanding  1,146,645
shares of the issuer's Common Stock.

         Transitional Small Business Disclosure format (check one): Yes    No X
                                                                       ---   ---
================================================================================

<PAGE>

EXPLANATION FOR AMENDMENT:

         The Annual Report on Form 10-KSB of GFSB Bancorp,  Inc. (the "Company")
for the fiscal year ended June 30, 2004 (the "2004 Form 10-KSB")  filed with the
Securities and Exchange  Commission (the  "Commission") on September 27, 2004 is
being amended hereby to include the items listed below:


        Item      Description
        ----      -----------

        Item 9    Directors, Executive Officers, Promoters and Control Persons;
                  Compliance with Section 16(a) of the Exchange Act

        Item 10   Executive Compensation

        Item 11   Security Ownership of Certain Beneficial Owners and Management
                  and Related Stockholder Matters

        Item 12   Certain Relationships and Related Transactions

        Item 14   Principal Accountant Fees and Services

         As originally  filed,  the Company's 2004 Form 10-KSB  incorporated the
information  required by Items 9, 10, 11, 12 and 14 of Form 10-KSB by  reference
to the  Company's  Definitive  Proxy  Statement  for its 2004 Annual  Meeting of
Stockholders (the "Proxy  Statement") as permitted by Instruction  E.(3).  Since
the Proxy  Statement is not expected to be filed with the Commission  within 120
days of the close of the  Company's  fiscal year ended June 30, 2004 as required
by  Instruction  E.(3),  Items 9, 10,  11, 12, 13 and 14 in Part III of the 2004
Form 10-KSB are hereby  amended by deleting the texts thereof in their  entirety
and substituting therefor the following:

                                       1
<PAGE>

                                    PART III

Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
--------------------------------------------------------------------------------
with Section 16(a) of the Exchange Act
--------------------------------------

         The  following  table  sets  forth  information  with  respect  to  the
directors and executive officers of the Company,  including for each their name,
age, the year they first  became a director of the Company or the Bank,  and the
expiration  date  of  their  current  term as a  director.  The  Certificate  of
Incorporation  requires that directors be divided into three classes,  as nearly
equal in number as possible,  with each class to serve for a  three-year  period
and  approximately  one-third of the directors  elected each year.  The Board of
Directors  currently  consists  of six  members,  each of whom also  serves as a
director of Gallup Federal Savings Bank (the "Bank"). The Board of Directors has
determined that Messrs.  Parker and Hamilton are independent  within the meaning
of the listing requirements of The Nasdaq Stock Market.

<TABLE>
<CAPTION>
                                                                          Year First
                                      Positions                           Elected or     Current
                                        with                               Appointed     Term to
Name                                   Company                   Age(1)   Director(2)    Expire
----                                   -------                   ------   -----------    ------
<S>                    <C>                                      <C>       <C>          <C>
Michael P. Mataya              Director and Treasurer              54        1994         2006

Charles L. Parker, Jr.                Director                     42        1994         2006

George S. Perce                Director and Secretary              65        1990         2006

Richard C. Kauzlaric     President, Chief Executive Officer        66        1983         2004
                                    and Director

Vernon I. Hamilton                    Director                     74        1990         2005

James Nechero, Jr.                    Director                     70        1976         2005

Richard P. Gallegos           Senior Vice President and            53         --           --
                                President of the Bank

Jerry R. Spurlin             Chief Financial Officer and           62         --           --
                                 Assistant Secretary

Leonard C. Scalzi         Senior Vice President of the Bank        56         --           --

William W. Head, Jr.          Chief Lending Officer and            64         --           --
                                 Assistant Secretary
</TABLE>

------------------
(1)  At June 30, 2004.
(2)  Refers to the year the individual first became a director of the Company or
     the Bank.  All such  directors  became  directors  of the Company  when the
     Company was incorporated in March 1995.

Biographical Information

         Set forth below is certain  information  with respect to the  directors
and executive officers of the Company. All directors and executive officers have
held their present positions for five years unless otherwise stated.

                                        2

<PAGE>

Directors:

         Michael P. Mataya is President  and Chief  Executive  Officer of Indian
Capital Distributing Co., a wholesale gasoline marketer.  Mr. Mataya is Director
of the New Mexico Petroleum  Marketers  Association,  Director of the New Mexico
Baptist Children's Home and is a former member of the Board of Directors for Los
Angeles Crippled Children's Hospital.

         Charles L.  Parker,  Jr.,  C.F.A.,  currently  serves as  President  of
Sanders Trading Corp.,  Twin Lakes Trading Corp. and Chambers  Trading Corp. Mr.
Parker also serves as Vice  President of Allifer,  Inc. These  corporations  are
privately held and engaged in retail and real estate investment activities.  Mr.
Parker is Director of KERA Public Television.

         George S. Perce is a Professional  Engineer,  a Professional  Surveyer,
the retired  owner of Perce  Engineering  and owner of Perce Farms of Deming,  a
producing pecan grove.

         Richard C. Kauzlaric was appointed  President of the Company on October
28, 2002. Mr.  Kauzlaric is also  President of Bubany  Insurance  Agency,  Inc.,
President of Western New Mexico  Gallup  Foundation,  past Regent of Western New
Mexico University,  past President of New Mexico Amigos, and a sustaining member
of the Amigos.  Mr.  Kauzlaric has been  instrumental  in the  redevelopment  of
downtown Gallup.  Mr. Kauzlaric served as Chairman of the Board of the Bank from
1989 to 2000 and was appointed again in October 2002.

         Vernon I. Hamilton is President of V.I. Hamilton Construction Co., Inc.
Mr. Hamilton is a member of the United Methodist  Church,  the Elks, the Masons,
and the Community Concert Association.

         James Nechero, Jr. was President of the Company until October 28, 2002.
Mr.  Nechero is the  President of Eagle Energy,  Inc., a real estate  investment
company and is a member of the New Mexico Amigos.

Executive Officers:

         Richard P.  Gallegos  joined the Bank as its  President on November 16,
1998 and was appointed Vice President of the Company in 2000 and became a member
of the Board of  Directors  of the Bank in 2002.  Prior to his joining the Bank,
Mr.  Gallegos was a President and Vice  President of a financial  institution in
Gallup, New Mexico and Albuquerque, New Mexico, respectively.  Mr. Gallegos is a
committee member of the  McKinley/Cibola/San  Juan Counties Enterprise Loan Fund
and a member of the Gallup Rotary Club.  Previously,  Mr. Gallegos served on the
board of Consumer Credit Counseling of New Mexico.

         Jerry R.  Spurlin  has been with the Bank since  September  of 1990 and
served as President from February 1991 to November  1998. Mr. Spurlin  currently
serves as Chief Financial Officer and Assistant  Secretary of the Company and is
Treasurer and a member of the Board of Directors of the Bank. Previously, he was
an Executive  Vice  President,  Senior Vice  President  and Vice  President at a
financial  institution  in  Alamogordo,  New  Mexico.  He has  served  twice  as
President of the Gallup-McKinley County Chamber of Commerce, and is the Chairman
of the Staff Parish Relations Committee for the First United Methodist Church of
Gallup.  Mr. Spurlin is  Secretary/Treasurer  of New Mexico  Western  University
Gallup  Foundation,  a former director of the Gallup Downtown  Development Group
and a member of the Gallup  Rotary Club. He is President of Habitat For Humanity
of Gallup.

                                        3

<PAGE>

         Leonard  C.  Scalzi   joined  the Bank on May 1,  2000 as  Senior  Vice
President - Commercial Lending. Previously, Mr. Scalzi served as a senior lender
for two New  Mexico  financial  institutions.  He is a member of the New  Mexico
Amigos,  a  director  for  Childhaven,  a  director  of  the  San  Juan  College
Foundation,  a director of  Independent  Community  Bankers  Association  of New
Mexico and a former president and director of the San Juan Country Club.

         William  W.  Head,  Jr.  is  the  Chief  Lending  Officer  of the Bank.
Previously  Mr.  Head was a lawyer  in  private  practice  with an  emphasis  in
banking,  commercial,  real estate and  probate  law.  Currently,  Mr. Head is a
director of the Housing Authority of the City of Gallup. He has been a member of
the Board of Directors  and  President  of the  Inter-Tribal  Indian  Ceremonial
Association.

Audit Committee

         The Audit  Committee  is comprised  of  Directors  Parker,  Nechero and
Hamilton.  The Board of Directors has  determined  that the members of the Audit
Committee  other than Mr.  Nechero  are  independent  within the  meaning of the
listing  requirements  for The Nasdaq Stock  Market.  The Board of Directors has
determined that Mr. Parker is an "audit committee  financial expert" and that he
is independent.

Code of Ethics

         The Company has adopted a Code of Ethics that applies to its  principal
executive officer,  principal financial officer, principal accounting officer or
controller or persons performing similar functions. A copy of the Company's Code
of Ethics will be provided to any person without charge upon written  request to
Jerry R. Spurlin,  Chief Financial Officer,  GFSB Bancorp,  Inc., 221 West Aztec
Avenue, Gallup, New Mexico 87301.

Section 16(a) Beneficial Ownership Reporting Compliance

         Section 16(a) of the  Securities  Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's directors and executive officers to file
reports of ownership and changes in ownership of their equity  securities of the
Company with the Securities  and Exchange  Commission and to furnish the Company
with copies of such reports. To the best of the Company's knowledge,  all of the
filings by the Company's  directors and executive officers were made on a timely
basis during the 2004 fiscal year.

                                        4

<PAGE>

Item 10.  Executive Compensation
--------  ----------------------

         Summary  Compensation Table. The following table sets forth information
concerning the  compensation for services in all capacities for the fiscal years
provided  below of those  persons  who  were,  at June 30,  2004,  (a) our chief
executive  officer  and (b) our other most  highly  compensated  officers  whose
salary and bonus earned during fiscal year 2004 exceeded $100,000 (collectively,
the "named executive  officers").  No other executive  officer of the Company or
the Bank earned cash  compensation  (salary and bonus) in excess of $100,000 for
the year ended June 30, 2004.

<TABLE>
<CAPTION>
                                                                                    Long Term Compensation
                                          Annual Compensation                              Awards
                                 -----------------------------------------------  --------------------------
                                                                                                 Securities
                                                                                    Restricted   Underlying
Name and                                                         Other Annual         Stock       Options/      All Other
Principal Position         Year   Salary($)      Bonus($)     Compensation($)(1)    Awards($)      SARs(#)   Compensation($)
-------------------        ----   ---------      --------     ------------------    ---------     --------   ---------------

<S>                      <C>    <C>            <C>                <C>            <C>            <C>           <C>
Richard Kauzlaric          2004   $     --       $    --            $27,750        $    --        $    --       $    --
President and Chief        2003         --                           19,500             --             --            --
Executive Officer of                                  --
the Company

Richard P. Gallegos        2004   $127,420       $    --            $    --        $    --        $    --       $12,518(5)
Senior Vice President      2003    122,420        32,500                 --             --             --        14,009
and President of the       2002    117,420        32,500                 --             --(2)          --        13,397
Bank

Jerry R. Spurlin           2004   $ 91,600       $15,000            $    --        $    --        $    --       $17,047(6)
Chief Financial            2003     89,000        20,000                 --             --             --        18,038
Officer                    2002     86,400        20,000                 --         61,413(3)          --        17,993

Leonard C. Scalzi          2004   $ 81,500       $18,000            $    --        $    --        $    --        $7,640(7)
Senior Vice President      2003     77,500        32,500                 --             --             --         8,948
                           2002     73,500        30,000                 --             --(4)          --         6,102
</TABLE>

-------------
(1)  Represents directors fees.
(2)  In fiscal 1999, Mr. Gallegos was awarded 7,500 shares of Common Stock under
     the  Management  Stock Bonus Plan ("MSBP") with a value of $10.90 per share
     based on the value of the stock as of the date of such  award.  This  stock
     award  becomes  non-forfeitable  at the  rate  of  1,500  shares  per  year
     commencing on November 16, 1999. Dividend rights associated with such stock
     are  accrued  and held in  arrears  to be paid at the time that such  stock
     becomes non-forfeitable. At June 30, 2004, no shares remain unvested.
(3)  In fiscal 2002,  Mr. Spurlin was awarded 4,250 shares of Common Stock under
     the  Management  Stock Bonus Plan ("MSBP") with a value of $14.45 per share
     based on the value of the stock as of the date of such  award.  This  stock
     award becomes non-forfeitable at the rate of 850 shares per year commencing
     on May 15, 2002. Dividend rights associated with such stock are accrued and
     held  in  arrears  to  be  paid  at  the  time  that  such  stock   becomes
     non-forfeitable.  At June 30,  2004,  1,700  shares with a market  value of
     $38,250 at such date (based on the closing  price of Common Stock of $22.50
     at such date) remain unvested.
(4)  In fiscal 2000,  Mr.  Scalzi was awarded 3,750 shares of Common Stock under
     the  Management  Stock Bonus Plan ("MSBP") with a value of $11.11 per share
     based on the value of the stock as of the date of such  award.  This  stock
     award becomes non-forfeitable at the rate of 750 shares per year commencing
     on May 1, 2001.  Dividend rights associated with such stock are accrued and
     held  in  arrears  to  be  paid  at  the  time  that  such  stock   becomes
     non-forfeitable.  At June 30,  2004,  750  shares  with a  market  value of
     $16,875 at such date (based on the closing  price of Common Stock of $22.50
     at such date) remain unvested.
(5)  Includes  $5,733 for the Company  matching  share in an employee 401-K plan
     and an  allocation of 1273 shares of Common Stock (at a cost basis of $5.33
     per share)  under the ESOP.  As of June 30,  2004,  the market value of the
     ESOP shares was $28,643.
(6)  Includes  $4,122 for the Company  matching  share in an employee 401-K plan
     and an  allocation of 2425 shares of Common Stock (at a cost basis of $5.33
     per share)  under the ESOP.  As of June 30,  2004,  the market value of the
     ESOP shares was $54,563.
(7)  Includes  $3,706 for the Company  matching  share in an employee 401-K plan
     and an  allocation  of 738 shares of Common Stock (at a cost basis of $5.33
     per share)  under the ESOP.  As of June 30,  2004,  the market value of the
     ESOP shares was $16,605.

                                        5

<PAGE>

         Stock Awards.  The following table sets forth  information with respect
to previously  awarded stock options to purchase the Common Stock granted to the
named  executive  officers and held by them as of June 30, 2004. The Company has
not granted to those named executive officers any stock appreciation rights.

        Aggregated Option Exercises in Last Fiscal Year and FY-End Option Values

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------
                                            Number of Securities
                      Shares               Underlying Unexercised           Value of Unexercised
                     Acquired                     Options                   in-the-Money Options
                        on       Value         at FY-End (#)                    at FY-End ($)
                     Exercise   Realized   ------------------------------------------------------------
          Name          (#)        ($)      Exercisable  Unexercisable  Exercisable       Unexercisable
-------------------------------------------------------------------------------------------------------
<S>                    <C>      <C>         <C>          <C>            <C>
Richard Kauzlaric        --        --         10,180            --       $144,513(1) (2)       --(1)(2)
Richard P. Gallegos      --        --         12,500            --       $145,000(3)           --(3)
Jerry R. Spurlin         --        --             --            --             --              --
Leonard C. Scalzi        --        --          7,000         1,750       $ 80,500(4)       20,125(4)
</TABLE>

-------------------------
(1)  Based  upon an  exercise  price of $7.40 per  share  for 7,623  exercisable
     shares and a closing price of $22.50 at June 30, 2004.
(2)  Based  upon an  exercise  price of $11.00  per share for 2,557  exercisable
     shares and a closing price of $22.50 at June 30, 2004.
(3)  Based upon an  exercise  price of $10.90  per share and a closing  price of
     $22.50 at June 30, 2004.
(4)  Based upon an  exercise  price of $11.00  per share and a closing  price of
     $22.50 at June 30, 2004.

         Change in Control Agreements.  The Bank entered into separate change in
control severance agreements with Messrs Gallegos, Spurlin and Scalzi for a term
of three years.  If the Bank terminates any of these three  executives  absent a
change in control of the Bank,  such  individuals  will not be  entitled  to any
severance payments.  In the event of the termination of employment in connection
with any change in control of the Bank or the  Company,  such  individuals  will
each be paid a lump sum  amount  equal to 200% times the base  annual  salary in
effect as of the end of the calendar  year prior to the date of  termination  of
employment.  In the event of a change of  control as of June 30,  2004,  Messrs.
Gallegos,  Spurlin  and  Scalzi  would  have  received  approximately  $254,840,
$183,200, and $163,000, respectively.

         Director  Compensation.  Each member of the Board of  Directors  of the
Company  receives an annual  retainer of $3,000 plus $100 per regular or special
board  meeting  attended.  Each member of the Board of Directors of the Bank who
attends a minimum of ten regular meetings receives an annual fee of $14,400. The
Chairman  of the  Board  of the  Bank  receives  an  additional  fee of  $6,000.
Committee  members receive fees of $100 per meeting attended with the exceptions
of the Audit Committee, for which members receive $300 per meeting attended, and
the  Management  Loan  Committee,  for which  members  receive  $250 per meeting
attended.  No board or  committee  fees are paid to board  members  who are also
employees.  During the fiscal year ended June 30, 2004, the Company paid a total
of $152,650 in director fees.

Item 11.  Security  Ownership of Certain  Beneficial  Owners and  Management and
--------------------------------------------------------------------------------
          Related Stockholder Matters
          ---------------------------

(a)      Security Ownership of Certain Beneficial Owners

         Persons  and  groups  owning in excess  of 5% of the  Common  Stock are
required  to file  certain  reports  regarding  such  ownership  pursuant to the
Exchange Act. The following  table sets forth,  as of June 30, 2004,  persons or
groups who own more than 5% of the  Common  Stock.  Other  than as noted  below,
management knows of no person or group that owns more than 5% of the outstanding
shares of Common Stock at June 30, 2004.

                                        6

<PAGE>

<TABLE>
<CAPTION>
                                                                    Percent of Shares of
                                             Amount and Nature of      Common Stock
Name and Address of Beneficial Owner         Beneficial Ownership      Outstanding(%)
------------------------------------         --------------------      --------------
<S>                                              <C>                     <C>
Gallup Federal Savings Bank Employee Stock
Ownership Plan (the "ESOP")
221 West Aztec Avenue, Gallup, New Mexico            96,896(1)               8.5

Lance S. Gad
1250 Fence Row Drive
Fairfield, Connecticut  06430                        82,126(2)               7.2

Charles L. Parker, Jr.
221 West Aztec Avenue
Gallup, New Mexico                                   87,313                  7.6

Richard C. Kauzlaric
221 West Aztec Avenue
Gallup, New Mexico                                  129,476                 11.3

George S. Perce
221 West Aztec Avenue
Gallup, New Mexico                                   87,333                  7.6
</TABLE>

----------------------------------
(1)  The  ESOP  purchased  such  shares  for  the  exclusive   benefit  of  ESOP
     participants with funds borrowed from the Company. These shares are held in
     a suspense  account and are allocated among ESOP  participants  annually on
     the basis of compensation as the ESOP debt is repaid. The ESOP Trustee must
     vote  all  shares  allocated  to  participant  accounts  under  the ESOP as
     directed by participants. Unallocated shares and shares for which no timely
     voting  directors is received will be voted by the ESOP Trustee as directed
     by the ESOP  Committee.  As of the record  date,  77,414  shares  have been
     allocated under the ESOP to participant accounts.
(2)  Based on a Schedule 13G filed on February 10, 1998.

                                       7
<PAGE>

(b)      Security Ownership of Management

         The  following  table  sets  forth  the  beneficial  ownership  of  the
Company's  common  stock as June 30, 2004 by each  director  and each  executive
officer named in the Summary Compensation Table as well as for all directors and
executive officers as a group.


                                                 Shares of
                                                Common Stock
                                                Beneficially       Percent
Name                                              Owned (1)        Owned(%)
----                                             ----------        --------
Michael P. Mataya                                 29,800            2.6
Charles L. Parker, Jr.                            87,313 (2)        7.6
George S. Perce                                   87,333 (2)        7.6
Richard C. Kauzlaric                             129,476           11.3
Vernon I. Hamilton                                55,907            4.8
James Nechero, Jr.                                56,820            4.9
Richard P. Gallegos                               26,497            2.0
Jerry R. Spurlin                                  38,669            3.2
Leonard C. Scalzi                                 12,528            1.1
Directors and executive officers as a            588,542           47.5
group (10 persons)

---------------
(1)  Includes the following number of shares that may be acquired within 60 days
     of June 30, 2004 by the  exercise of options:  Hamilton - 9,096;  Nechero -
     9,457; Mataya - 8,927;  Parker - 9,265; Perce - 9,289;  Kauzlaric - 10,180;
     Gallegos - 12,500; and Scalzi - 7,000.
(2)  Excludes  19,481  shares of Common Stock held under the ESOP for which such
     individual  serves  as either  an ESOP  Trustee  or as a member of the ESOP
     Committee.  Beneficial  ownership is  disclaimed  with respect to such ESOP
     shares held in a fiduciary capacity.


(c)      Changes in Control.  On August 25, 2004, the Company  announced that it
         had signed a definitive merger agreement with First Federal Banc of the
         Southwest,  Inc. ("FFBSW"), the holding company for First Federal Bank,
         Roswell, New Mexico,  pursuant to which the Company will merge with and
         into FFBSW.

         Under the terms of the agreement,  upon  consummation  of the merger of
the Company into FFBSW,  each  outstanding  share of the Company's  common stock
will be  converted  into the  right to  receive  either  $20.00 in cash or FFBSW
common stock, at the election of the holder,  subject to an overall  requirement
that 51% of the Company's total outstanding common stock be exchanged for stock.
The transaction is subject to various conditions, including stockholder approval
of both the Company and FFBSW, and approval by the applicable banking regulatory
agencies.

         Pursuant  to the terms of the  merger  agreement,  FFBSW has  agreed to
register  FFBSW's common stock under the Securities  Exchange Act of 1934 and it
will file reports with the Securities and Exchange Commission. In addition, upon
the  completion  of the  merger,  its  shares are  expected  to be listed on the
NASDAQ.

                                        8

<PAGE>

         Management of the Company knows of no other arrangements, including any
pledge by any person of securities of the Company, the operation of which may at
a subsequent date result in a change in control of the Company.

(d)      Securities Authorized for Issuance Under Equity Compensation Plans

         Set forth  below is  information  as of June 30,  2004 with  respect to
compensation  plans under which equity  securities of the Company are authorized
for issuance.

<TABLE>
<CAPTION>
                                 EQUITY COMPENSATION PLAN INFORMATION

                                          (a)                      (b)                        (c)
                                                                Weighted-             Number of securities
                                  Number of securities       average exercise        remaining available for
                                   to be issued upon            price of              future issuance under
                                      exercise of              outstanding          equity compensation plans
                                  outstanding options,      options, warrants         (excluding securities
                                  warrants and rights          and rights           reflected in column (a))
                                  --------------------         ----------           ------------------------
<S>                                   <C>                   <C>                               <C>
Equity compensation plans
approved by shareholder:
    1995 Stock Option Plan.......        88,349                $  8.48                           58,680
    Management Stock
         Bonus Plan..............         5,135                     --                           20,077
    2000 Stock Option Plan.......            --                    N/A                           58,500
Equity compensation plans
not approved by shareholders:
    Directors Stock
        Compensation Plan (1)....        11,946                  11.00                               --
                                        -------                -------                          -------
     TOTAL.......................       105,430                $  8.35                          137,257
                                        =======                =======                          =======
</TABLE>

---------------
(1)  Plan approved by the Company's board of directors on March 22, 2000.

                                        9

<PAGE>

Item 12.  Certain Relationships and Related Transactions
--------  ----------------------------------------------

         The  Bank,  like  many  financial  institutions,  grants  loans  to its
officers and  directors.  All loans by the Bank to its  directors  and executive
officers are subject to OTS regulations restricting loans and other transactions
with affiliated  persons of the Company.  Savings  institutions are permitted to
make  loans  to  executive  officers,   directors  and  principal   shareholders
("insiders")  on  preferential  terms,  provided the extension of credit is made
pursuant  to a  benefit  or  compensation  program  of the Bank  that is  widely
available  to  employees  of the  Bank  or its  affiliates  and  does  not  give
preference to any insider over other employees of the Bank or affiliate. As part
of the Bank's  compensation  program,  the Bank sets the interest rate for loans
approved  for  full-time   employees,   officers  and  directors  for  personal,
non-business   purposes  at  a  rate  which  is  1%  lower  than  the  rate  for
non-employees for the same type of loan, as long as the resulting  interest rate
is not lower than the Bank's cost of funds.  Such rates are only effective while
such  persons  are  employees,   officers,   or  directors  of  the  Bank.  Upon
termination, resignation or retirement, the rate reverts to the market rate that
existed at the time the loan is granted.  All other loans to insiders  have been
made in the ordinary course of business, and on substantially the same terms and
conditions,  including interest rates and collateral, as those prevailing at the
time for comparable  transactions  with the Bank's other  customers,  and do not
involve  more  than  the  normal  risk  of  collectibility,  nor  present  other
unfavorable features.

         Set  forth  below is  certain  information  relating  to loans  made on
preferential  terms to executive  officers and  directors of the Company and the
Bank whose total aggregate loan balances on preferential  terms exceeded $60,000
at any time during the year ended June 30, 2004.

<TABLE>
<CAPTION>
                                                                 Original       Prevailing                Unpaid
   Name of Officer or                              Date            Loan            Rate    Employee       Balance
        Director            Type of Loan        Originated      Amount ($)        (%)(1)   Rate (%)     06/30/04 ($)
----------------------   ---------------------  ----------      ----------        ------   ---------    ------------

<S>                   <C>                      <C>              <C>              <C>       <C>            <C>
James Nechero, Jr.       Home Mortgage           03/12/98         112,000          6.63      5.63                 0

Michael P. Mataya                                                                                           196,535
  Revocable Trust        Home Mortgage           03/04/03         260,000          5.13      4.13
Michael P. Mataya        Automobile              02/20/03           9,054         10.50      9.50                 0

Jerry R. Spurlin         Home Mortgage           03/31/03         129,000          5.63      4.63           126,616
Jerry R. Spurlin         Home Equity Line
                           of Credit              4/23/97          17,000          6.00      5.00            15,967

William W. Head, Jr.     Home Mortgage           10/05/01         132,000          6.00      5.00           107,772
William W. Head, Jr.     Home Equity Line
                           of Credit              5/22/00          20,000          6.00      5.00             6,029
William W. Head, Jr.     Automobile               6/24/03          22,050          5.50      4.50                 0

Charles L. Parker, Jr.   Home Mortgage           04/16/03         400,000          5.13      4.13           340,559


Richard P. Gallegos      Home Mortgage           04/16/03         124,000          5.13      4.13           107,838
</TABLE>

---------------
(1)  Prevailing rate at time of origination for fixed-rate loans or at last rate
     adjustment for variable-rate loans.

                                       10

<PAGE>

Item 13.  Exhibits
--------  ---------

         The following  exhibits are included in this Report or are incorporated
herein by reference.

<TABLE>
<CAPTION>
      <S>         <C>
            2.1      Agreement and Plan of Merger, dated as of August 25, 2004, between GFSB Bancorp,
                     Inc. and First Federal Banc of the  Southwest,  Inc.*
            3.1      Certificate of Incorporation  of GFSB Bancorp,  Inc.**
            3.2      Bylaws of GFSB Bancorp, Inc.**
            10.1+    1995 Stock Option Plan***
            10.2+    Management Stock Bonus Plan***
            10.3+    Form of Directors Deferred Compensation Agreement between the Bank and
                     Directors****
            10.4+    Form of Directors Stock Compensation Plan between the Company and Directors of
                     the Company****
            10.5+    2000 Stock Option Plan*****
            10.6+    Change-in-Control Severance Agreement with Richard P. Gallegos******
            10.7+    Change-in-Control Severance Agreement with Jerry R. Spurlin******
            10.8+    Change-in-Control Severance Agreement with William W. Head, Jr.******
            10.9+    Change-in-Control Severance Agreement with Leonard C. Salzi******
            21       Subsidiaries of the Company (See "Item 1 - Description of Business")
            23       Consent of Neff + Ricci LLP******
            31.1     Rule 13a-14(a)/15d-14(a) Certification
            31.2     Rule 13a-14(a)/15d-14(a) Certification
            32       Section 1350 Certification
</TABLE>

--------------
+        Management contract or compensatory plan or arrangement.
*        Incorporated herein by reference to the identically numbered exhibit to
         the current report on Form 8-K filed with the SEC on August 26, 2004.
**       Incorporated herein by reference to the Registration  Statement on Form
         S-1 of the  Company  (File  No.  33-90400)  initially  filed  with  the
         Commission on March 17, 1995.
***      Incorporated by reference to the identically  numbered  exhibits of the
         Annual  Report on Form  10-KSB for the fiscal  year ended June 30, 1997
         (File No. 0-25854) filed with the SEC.
****     Incorporated by reference to the identically  numbered  exhibits of the
         Quarterly  Report on Form 10- QSB for the quarter  ended March 31, 2001
         filed with the SEC.
*****    Incorporated by reference to Exhibit 4.1 to the Registration  Statement
         on Form S-8 (File No.  333-  51498)  filed with the SEC on  December 8,
         2000.
******   Incorporated  by  reference  to Annual  Report on Form  10-KSB  for the
         fiscal year ended June 30, 2004 as filed September 27, 2004.

Item 14.   Principal Accountant Fees and Services
--------   --------------------------------------

         The  aggregate  fees billed by Neff + Ricci for  professional  services
rendered for the audit of the Company's consolidated annual financial statements
and for the  reviews  of the  financial  statements  included  in the  Company's
quarterly  reports on Forms  10-QSB for the fiscal years ended June 30, 2003 and
June 30, 2004 were $42,102 and $46,511, respectively.

                                       11

<PAGE>

Audit Related Fees.

         There were no fees  billed by Neff + Ricci for  assurance  and  related
services  related  to the  performance  of the  audit  of the  Company's  annual
financial  statements  and to the  review  of the  financial  statements  in the
Company's Form 10-QSB filings for the years ended June 30, 2004 and 2003.

Tax Fees.

         The  aggregate  fees billed by Neff + Ricci for  professional  services
rendered  for tax  compliance,  tax advice and tax  planning for the years ended
June 30, 2004 and 2003 were $5,394 and $6,207,  respectively.  Such  tax-related
services consisted in both years of tax return preparation and consultation.

All Other Fees

         The  aggregate  fees  billed  by Neff + Ricci  to the  Company  and its
consolidated  subsidiary  for services or products other than those listed under
the captions  "Audit Fees," "Audit  Related Fees" and "Tax Fees" totaled  $5,299
for the year ended June 30, 2004 and consisted of tax valuations.  There were no
"other fees" billed by Neff + Ricci for the year ended June 30, 2003.

                                       12

<PAGE>

                                   SIGNATURES

         In accordance with Section 13 or 15(d) of the Exchange Act, the Company
has duly  caused  this  report to be signed  on its  behalf by the  undersigned,
thereunto duly authorized on October 26, 2004.

                                     GFSB BANCORP, INC.


                                     By:      /s/Richard C. Kauzlaric
                                              ----------------------------------
                                              Richard C. Kauzlaric
                                              President
                                              (Duly Authorized Representative)