##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the quarterly period endedSeptember 30, 2010
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number: 0-54081
 MADISON BANCORP, INC.
  Maryland
    
    27-258073(State or other jurisdiction of incorporation or
    
    (I.R.S. Employer Identification No.)organization)9649 Belair Road, Suite 300, Baltimore, Maryland
    
    21236(Address of principal executive offices)
    
    (Zip Code)
 (410) 529-7400
 (Registrants telephone number, including area code)
 Not Applicable
 (Former name, former address and former fiscal year, if changed since last report)
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ




---



##### 



MADISON BANCORP, INC.
 Table of Contents
 PageNo.Part I. Financial InformationItem 1. Financial Statements (Unaudited)Consolidated Statements of Financial Condition as of September 30, 2010 (unaudited) and March 31, 2010
    
    
    2Consolidated Statements of Operations for the Six and Three Months Ended September 30, 2010 and 2009 (unaudited)
    
    
    3Consolidated Statement of Changes in Equity for the Six Months Ended September 30, 2010 (unaudited)
    
    
    4Consolidated Statements of Cash Flows for the Six Months Ended September 30, 2010 and 2009 (unaudited)
    
    
    5Notes to Unaudited Consolidated Financial Statements
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    15Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    23Item 4. Controls and Procedures
    
    
    23Part II. Other InformationItem 1. Legal Proceedings
    
    
    24Item 1A. Risk Factors
    
    
    24Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    24Item 3. Defaults Upon Senior Securities
    
    
    24Item 4. [Removed and Reserved]
    
    
    24Item 5. Other Information
    
    
    24Item 6. Exhibits
    
    
    24Signatures
    
    
    25Exhibit 31.1Exhibit 32.0
   1




---



##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 MADISON BANCORP, INC AND SUBSIDIARIES
 
 Consolidated Statements of Financial Condition
 September 30, 2010 and March 31, 2010
 September 30,
    
    
    March 31,2010
    
    
    2010(Unaudited)
    
    
    (Audited)AssetsAssetsCash and cash equivalents
    
    $
    20,003,910
    
    
    $
    13,354,975Certificates of deposit
    
    
    964,785
    
    
    
    956,972Investment securities available-for-sale
    
    
    35,340,883
    
    
    
    33,480,669Investment securities held-to-maturity
    
    
    1,566,273
    
    
    
    2,283,707Federal Home Loan Bank stock, at cost
    
    
    242,500
    
    
    
    242,500Loans receivable, net
    
    
    88,773,453
    
    
    
    90,336,475Property and equipment, net
    
    
    3,893,418
    
    
    
    3,983,182Ground rents, net
    
    
    470,580
    
    
    
    477,273Other real estate owned
    
    
    434,000
    
    
    
    0Accrued interest receivable
    
    
    429,708
    
    
    
    430,549Deferred income taxes
    
    
    0
    
    
    
    5,828Prepaid expenses and other assets
    
    
    1,530,780
    
    
    
    1,337,364Total Assets
    
    $
    153,650,290
    
    
    $
    146,889,494Liabilities and EquityLiabilitiesDeposits:Noninterest bearing
    
    $
    6,196,096
    
    
    $
    5,267,672Interest bearing
    
    
    137,550,760
    
    
    
    131,697,595Total Deposits
    
    
    143,746,856
    
    
    
    136,965,267Advances from borrowers for taxes and insurance
    
    
    279,880
    
    
    
    557,686Deferred income taxes
    
    
    129,437
    
    
    
    0Other liabilities
    
    
    240,763
    
    
    
    303,514Total Liabilities
    
    
    144,396,936
    
    
    
    137,826,467EquityRetained earnings
    
    
    8,886,235
    
    
    
    8,903,564Accumulated other comprehensive income
    
    
    367,119
    
    
    
    159,463Total Equity
    
    
    9,253,354
    
    
    
    9,063,027Total Liabilities and Equity
    
    $
    153,650,290
    
    
    $
    146,889,494
   2




---



##### Table of Contents



MADISON BANCORP, INC AND SUBSIDIARIES
 
 Consolidated Statements of Operations



(Unaudited)
 Six and Three Months Ended September, 2010 and 2009
 Three Months Ended
    
    
    Six Months EndedSeptember 30
    
    
    September 302010
    
    
    2009
    
    
    2010
    
    
    2009Interest RevenueInterest and fees on loans
    
    $
    1,265,518
    
    
    $
    1,268,025
    
    
    $
    2,537,874
    
    
    $
    2,518,789Investment securities available-for-sale
    
    
    200,660
    
    
    
    221,650
    
    
    
    442,963
    
    
    
    423,176Investment securities held-to-maturity
    
    
    22,056
    
    
    
    197,487
    
    
    
    47,635
    
    
    
    233,701Interest-bearing deposits
    
    
    11,823
    
    
    
    9,301
    
    
    
    19,296
    
    
    
    17,413Other
    
    
    266
    
    
    
    508
    
    
    
    422
    
    
    
    508Total Interest Revenue
    
    
    1,500,323
    
    
    
    1,696,971
    
    
    
    3,048,190
    
    
    
    3,193,587Interest ExpenseInterest on deposits:Time
    
    
    558,564
    
    
    
    725,701
    
    
    
    1,137,712
    
    
    
    1,559,502Savings
    
    
    19,751
    
    
    
    34,909
    
    
    
    40,451
    
    
    
    74,255NOW and money market demand accounts
    
    
    2,941
    
    
    
    6,262
    
    
    
    5,906
    
    
    
    14,242Other interest expense
    
    
    6
    
    
    
    11
    
    
    
    40
    
    
    
    48Total Interest Expense
    
    
    581,262
    
    
    
    766,883
    
    
    
    1,184,109
    
    
    
    1,648,047Net Interest Income
    
    
    919,061
    
    
    
    930,088
    
    
    
    1,864,081
    
    
    
    1,545,540Provision for Loan Losses
    
    
    60,315
    
    
    
    70,000
    
    
    
    111,674
    
    
    
    110,000Net Interest Income after Provision for Loan Losses
    
    
    858,746
    
    
    
    860,088
    
    
    
    1,752,407
    
    
    
    1,435,540Noninterest RevenueGain (Loss) on disposal of property
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    (1,182
    )Gain on sale of investment securities
    
    
    27,459
    
    
    
    (4,087
    )
    
    
    56,378
    
    
    
    (4,057
    )Other than temporary impairment of securities
    
    
    0
    
    
    
    (150,000
    )
    
    
    0
    
    
    
    (150,000
    )Other
    
    
    84,897
    
    
    
    70,163
    
    
    
    163,370
    
    
    
    129,982Total Noninterest Revenue
    
    
    112,356
    
    
    
    (83,924
    )
    
    
    219,748
    
    
    
    (25,257
    )Noninterest ExpensesSalaries and employee benefits
    
    
    471,693
    
    
    
    495,901
    
    
    
    948,845
    
    
    
    988,999Occupancy & equipment expense
    
    
    266,800
    
    
    
    251,822
    
    
    
    542,518
    
    
    
    504,777Advertising
    
    
    1,733
    
    
    
    3,092
    
    
    
    3,546
    
    
    
    6,354Audit and accounting
    
    
    33,145
    
    
    
    23,441
    
    
    
    66,990
    
    
    
    40,836FDIC premiums and OTS assessments
    
    
    100,096
    
    
    
    76,829
    
    
    
    197,398
    
    
    
    225,376Data processing
    
    
    44,815
    
    
    
    54,728
    
    
    
    98,087
    
    
    
    97,224Stationary and postage
    
    
    16,992
    
    
    
    22,774
    
    
    
    36,780
    
    
    
    43,211Other operating expenses
    
    
    52,825
    
    
    
    46,668
    
    
    
    95,320
    
    
    
    116,305Total Noninterest Expenses
    
    
    988,099
    
    
    
    975,255
    
    
    
    1,989,484
    
    
    
    2,023,082Loss Before Income Taxes
    
    
    (16,997
    )
    
    
    (199,091
    )
    
    
    (17,329
    )
    
    
    (612,799
    )Income Tax Expense (Benefit)
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Net Loss
    
    $
    (16,997
    )
    
    $
    (199,091
    )
    
    $
    (17,329
    )
    
    $
    (612,799
    )Basic earnings per common share
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/ADiluted earnings per common share
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
   3




---



##### Table of Contents



MADISON BANCORP, INC AND SUBSIDIARIES
 
 Consolidated Statement of Changes in Equity




(Unaudited)
 Six Months Ended September 30, 2010
 AccumulatedOtherRetained
    
    
    Comprehensive
    
    
    TotalEarnings
    
    
    Income
    
    
    EquityBalance March 31, 2010
    
    $
    8,903,564
    
    
    $
    159,463
    
    
    $
    9,063,027Comprehensive income:Net (Loss)
    
    
    (17,329
    )
    
    
    
    
    
    
    (17,329
    )Net unrealized gain on available for sale securities, net of tax effect of $135,265
    
    
    
    
    
    
    207,656
    
    
    
    207,656Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    190,327Balance September 30, 2010
    
    $
    8,886,235
    
    
    $
    367,119
    
    
    $
    9,253,354
  4




---



##### Table of Contents



MADISON BANCORP, INC AND SUBSIDIARIES
 
 Consolidated Statements of Cash Flows



(Unaudited)
 Six Months Ended September 30, 2010 and 2009
 September 30, 2010
    
    
    September 30, 2009Cash flows from Operating ActivitiesNet loss
    
    $
    (17,329
    )
    
    $
    (612,799
    )Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:Amortization (accretion) of investment securities
    
    
    29,940
    
    
    
    (137,916
    )Decrease in net deferred loan costs
    
    
    (13,759
    )
    
    
    (16,811
    )Provision for loan losses
    
    
    111,674
    
    
    
    110,000Loss on sale of ground rents
    
    
    593
    
    
    
    0(Gain) Loss on sale of investment securities
    
    
    (56,378
    )
    
    
    4,087Other than temporary impairment charge
    
    
    0
    
    
    
    150,000(Gain) Loss on disposal of property and equipment
    
    
    0
    
    
    
    1,182Depreciation and amortization
    
    
    115,644
    
    
    
    133,348Changes in operating assets and liabilities:Refundable income taxes
    
    
    0
    
    
    
    198,037Accrued interest receivable
    
    
    841
    
    
    
    48,769Prepaid expenses and other assets
    
    
    (193,416
    )
    
    
    (115,788
    )Other liabilities
    
    
    (62,751
    )
    
    
    (9,834
    )Net Cash provided by (used in) operating activities
    
    
    (84,941
    )
    
    
    (247,725
    )Cash flows from Investing ActivitiesIncrease (decrease) in loans receivable, net
    
    
    1,031,107
    
    
    
    202,915Increase in certificates of deposit, net
    
    
    (7,813
    )
    
    
    (951,719
    )Principal payments on HTM securities
    
    
    310,513
    
    
    
    445,641Principal payments on AFS securities
    
    
    4,155,638
    
    
    
    3,173,876Proceeds from maturing investment securities
    
    
    7,117,000
    
    
    
    8,845,000Proceeds from sales investment securities
    
    
    3,758,167
    
    
    
    0Purchases of investment securities
    
    
    (16,114,739
    )
    
    
    (13,370,467
    )Purchase of property and equipment
    
    
    (25,880
    )
    
    
    (121,124
    )Proceeds from sale of ground rents
    
    
    6,100
    
    
    
    11,750Net cash used in investing activities
    
    
    230,093
    
    
    
    (1,764,128
    )Cash flow from Financing ActivitiesIncrease (decrease) in:Deposits, net
    
    
    6,781,589
    
    
    
    6,848,942Advances from borrowers, net
    
    
    (277,806
    )
    
    
    (291,871
    )Net cash provided by financing activities
    
    
    6,503,783
    
    
    
    6,557,071Increase (Decrease) in Cash and Cash Equivalents
    
    
    6,648,935
    
    
    
    4,545,218Cash and Cash Equivalents, Beginning of Period
    
    
    13,354,975
    
    
    
    16,321,326Cash and Cash Equivalents, End of Period
    
    $
    20,003,910
    
    
    $
    20,866,544Supplemental disclosure:Loans transferred to other real estate owned
    
    $
    434,000
    
    
    
    0
  5




---



##### Table of Contents



Note 1: Activities and Summary of Significant Accounting Policies
       Subsequent Events 
  6




---



##### Table of Contents



Note 2: Supplemental Disclosure for Earnings per Share
   7




---



##### Table of Contents



Note 3: Investment Securities
  Gross
    
    
    GrossUnrealized
    
    
    Unrealized
    
    
    EstimatedAmortized Cost
    
    
    Gains
    
    
    Losses
    
    
    Fair ValueSeptember 30, 2010Investment securities
available-for-sale:U.S. government agencies
    
    $
    4,604,570
    
    
    $
    4,808
    
    
    
    0
    
    
    $
    4,609,378Brokered certificates of deposit
    
    
    3,573,685
    
    
    
    0
    
    
    
    3,991
    
    
    
    3,569,694Mortgage-backed securities (Agency)
    
    
    26,556,374
    
    
    
    616,138
    
    
    
    10,701
    
    
    
    27,161,811$
    34,734,629
    
    
    $
    620,946
    
    
    $
    14,692
    
    
    $
    35,340,883Investment securities held-to-maturity:Mortgage-backed securities (Agency)
    
    $
    971,765
    
    
    $
    35,880
    
    
    $
    3,875
    
    
    $
    1,003,770Mortgage-backed securities
(Nonagency)
    
    
    594,508
    
    
    
    34,964
    
    
    
    150,011
    
    
    
    479,461$
    1,566,273
    
    
    $
    70,844
    
    
    $
    153,886
    
    
    $
    1,483,231
 Gross
    
    
    GrossUnrealized
    
    
    Unrealized
    
    
    EstimatedAmortized Cost
    
    
    Gains
    
    
    Losses
    
    
    Fair ValueMarch 31, 2010Investment securities
available-for-sale:U.S. government agencies
    
    $
    4,499,222
    
    
    $
    15,793
    
    
    $
    1,150
    
    
    $
    4,513,865Brokered certificates of deposit
    
    
    2,670,928
    
    
    
    0
    
    
    
    6,425
    
    
    
    2,664,503Mortgage-backed securities (Agency)
    
    
    26,010,952
    
    
    
    341,079
    
    
    
    49,730
    
    
    
    26,302,301$
    33,181,102
    
    
    $
    356,872
    
    
    $
    57,305
    
    
    $
    33,480,669Investment securities held-to-maturity:Mortgage-backed securities (Agency)
    
    $
    1,177,893
    
    
    $
    34,377
    
    
    $
    6,606
    
    
    $
    1,205,664Mortgage-backed securities
(Nonagency)
    
    
    1,105,814
    
    
    
    86,774
    
    
    
    174,963
    
    
    
    1,017,625$
    2,283,707
    
    
    $
    121,151
    
    
    $
    181,569
    
    
    $
    2,223,289
  8




---



##### Table of Contents



Note 3: Investment Securities (Continued)
  Held-to-maturity
    
    
    Available-for-saleAmortized
    
    
    
    
    
    
    AmortizedCost
    
    
    Fair Value
    
    
    Cost
    
    
    Fair ValueAmounts maturing in:One year or less
    
    $
    -0-
    
    
    $
    -0-
    
    
    $
    924,685
    
    
    $
    926,257After one year through five years
    
    
    -0-
    
    
    
    -0-
    
    
    
    7,002,748
    
    
    
    7,001,887After five years through ten years
    
    
    -0-
    
    
    
    -0-
    
    
    
    250,822
    
    
    
    250,928After ten years
    
    
    -0-
    
    
    
    -0-
    
    
    
    -0-
    
    
    
    -0--0-
    
    
    
    -0-
    
    
    
    8,178,255
    
    
    
    8,179,072Mortgage-backed securities (Agency)
    
    
    971,765
    
    
    
    1,003,770
    
    
    
    26,556,374
    
    
    
    27,161,811Mortgage-backed securities
(Nonagency)
    
    
    594,508
    
    
    
    479,461
    
    
    
    -0-
    
    
    
    -0-$
    1,566,273
    
    
    $
    1,483,231
    
    
    $
    34,734,629
    
    
    $
    35,340,883
   9




---



##### Table of Contents



Note 4: Loans Receivable
  September 30,
    
    
    March 31,2010
    
    
    2010Loans secured by mortgages:Residential1-4 Single family
    
    $
    59,231,571
    
    
    $
    62,875,698Multifamily
    
    
    1,704,380
    
    
    
    1,736,945Commercial
    
    
    11,793,585
    
    
    
    11,597,811Land
    
    
    5,948,731
    
    
    
    4,849,495Lines of credit
    
    
    1,464,038
    
    
    
    1,407,436Residential construction
    
    
    2,973,571
    
    
    
    2,395,52883,115,876
    
    
    
    84,862,913Consumer
    
    
    1,037,129
    
    
    
    1,203,106Commercial
    
    
    5,058,804
    
    
    
    4,755,553Total loans receivable
    
    
    89,211,809
    
    
    
    90,821,572Net deferred costs
    
    
    106,144
    
    
    
    119,903Allowance for loan losses
    
    
    (544,500
    )
    
    
    (605,000
    )Loans receivable, net
    
    $
    88,773,453
    
    
    $
    90,336,475
 Note 5: Allowance for Loan Losses
  Six Months
    
    
    
    
    
    
    Six MonthsEnded
    
    
    
    
    
    
    EndedSeptember 30,
    
    
    Year Ended
    
    
    September 30,2010
    
    
    March 31, 2010
    
    
    2009Balance  Beginning of Year
    
    $
    605,000
    
    
    $
    379,500
    
    
    $
    379,500Provision for loan losses
    
    
    111,674
    
    
    
    242,074
    
    
    
    110,000Recoveries
    
    
    1,641
    
    
    
    -0-
    
    
    
    400Charge Offs
    
    
    (173,815
    )
    
    
    (16,574
    )
    
    
    (400
    )Balance  End of Year
    
    $
    544,500
    
    
    $
    605,000
    
    
    $
    489,500September 30,
    
    
    March 31,2010
    
    
    2010Nonaccrual loans
    
    $
    70,493
    
    
    $
    680,112Allowance for loan loss as
percentage of nonaccrual loans
    
    
    772.40
    %
    
    
    88.96
    %Interest on nonaccrual loans
    
    $
    7,605
    
    
    $
    22,705
  10




---



##### Table of Contents



Note 6: Fair Value Measurements
  
    
    Level 1  Valuation is based on quoted prices in active markets for
identical assets and liabilities.
    
    Level 2  Valuation is determined from quoted prices for similar assets or
liabilities in active markets, quoted prices for identical or similar
instruments in markets that are not active or by model-based techniques in
which all significant inputs are observable in the market.
    
    Level 3  Valuation is derived from model-based techniques in which at least
one significant input is unobservable and based on the Banks own estimates
about the assumptions that market participants would use to value the asset or
liability.
  September 30, 2010Total
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3Investment securities
available-for-sale
    
    $
    35,340,918
    
    
    $
    8,669,808
    
    
    $
    26,067,962
    
    
    $
    603,148
 March 31, 2010Total
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3Investment securities
available-for-sale
    
    $
    33,480,669
    
    
    $
    956,772
    
    
    $
    32,520,274
    
    
    $
    3,623
   11




---



##### Table of Contents



Note 6: Fair Value Measurements (Continued)
  September 30, 2010
    
    
    March 31, 2010(in thousands)
    
    
    (in thousands)Book Value
    
    
    Fair Value
    
    
    Book Value
    
    
    Fair ValueAssets:Cash and cash equivalents
    
    $
    20,004
    
    
    $
    20,004
    
    
    $
    13,355
    
    
    $
    13,355Certificates of deposit
    
    
    965
    
    
    
    965
    
    
    
    957
    
    
    
    957Investment securities
    
    
    36,907
    
    
    
    36,824
    
    
    
    35,764
    
    
    
    35,704Loans, net
    
    
    88,773
    
    
    
    88,854
    
    
    
    90,336
    
    
    
    90,249Total financial assets
    
    $
    146,649
    
    
    $
    146,647
    
    
    $
    140,412
    
    
    $
    140,265
 September 30, 2010
    
    
    March 31, 2010(in thousands)
    
    
    (in thousands)Book Value
    
    
    Fair Value
    
    
    Book Value
    
    
    Fair ValueLiabilities:Deposits
    
    $
    143,747
    
    
    $
    145,313
    
    
    $
    136,965
    
    
    $
    140,111Advanced payments by borrowers for
taxes and insurance
    
    
    280
    
    
    
    280
    
    
    
    558
    
    
    
    558Total financial liabilities
    
    $
    144,027
    
    
    $
    145,593
    
    
    $
    137,523
    
    
    $
    140,669
  Cash and cash equivalents
 Investment securities held-to-maturity
 Loans, net:
 Deposits:
  12




---



##### Table of Contents



Note 7: Accounting Standards Updates
       13




---



##### Table of Contents



Note 7: Accounting Standards Updates (Continued)
   Note 8: Commitment and Financial Instruments with Off-Balance-Sheet Credit Risk
    Mortgage loans commitments  fixed rate
    
    $
    2,416,000Mortgage loans commitments  variable rate
    
    
    3,823,000Commitments to originate nonmortgage loans
    
    
    110,000Commitments to purchase loans
    
    
    739,000Unused equity lined of credit (variable rate)
    
    
    1,611,000Commercial and consumer lines of credit
    
    
    753,000Standby letters of credit
    
    
    376,000Total
    
    $
    9,828,000
   14




---



##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operation
 Safe Harbor Statement for Forward-Looking Statements
   Critical Accounting Policies
  Allowance for Loan Losses.
 Fair Value of Investments.
  15




---



##### Table of Contents



Comparison of Financial Condition at September 30, 2010 and March 31, 2010
 Assets.
 Loans.
 Cash and Securities.
 Ground Rent.
 Deposits.
 Borrowings.
 Results of Operations for the Three Months Ended September 30, 2010 and 2009
 Overview.
 Net Interest Income.
   16




---



##### Table of Contents



Average Balance and Yields
  17




---



##### Table of Contents



Three Months EndedSeptember 30,2010
    
    
    2009Interest
    
    
    
    
    
    
    
    
    
    
    InterestAverage
    
    
    and
    
    
    Yield/
    
    
    Average
    
    
    and
    
    
    Yield/Balance
    
    
    Dividends
    
    
    Cost
    
    
    Balance
    
    
    Dividends
    
    
    CostAssets:Cash and cash equivalents
    
    $
    18,711,885
    
    
    $
    11,823
    
    
    
    0.25
    %
    
    $
    18,724,707
    
    
    $
    9,301
    
    
    
    0.20
    %Investment securities held-to-maturity
    
    
    1,721,390
    
    
    
    22,056
    
    
    
    5.13
    
    
    
    2,895,728
    
    
    
    197,487
    
    
    
    27.28Investment securities available-for-sale (1)
    
    
    32,579,318
    
    
    
    200,660
    
    
    
    2.46
    
    
    
    27,004,214
    
    
    
    221,650
    
    
    
    3.28Loans receivable, net
    
    
    89,443,600
    
    
    
    1,265,518
    
    
    
    5.66
    
    
    
    89,011,410
    
    
    
    1,268,025
    
    
    
    5.70Other interest-earning assets
    
    
    242,500
    
    
    
    266
    
    
    
    0.44
    
    
    
    242,500
    
    
    
    508
    
    
    
    0.84Total interest-earning assets
    
    
    142,698,693
    
    
    
    1,500,323
    
    
    
    4.21
    
    
    
    137,878,559
    
    
    
    1,696,971
    
    
    
    4.92Non-interest-earning assets
    
    
    7,895,951
    
    
    
    
    
    
    
    
    
    
    
    6,135,706Total assets
    
    $
    150,594,644
    
    
    
    
    
    
    
    
    
    
    $
    144,014,265Liabilities and equity:Time deposits
    
    $
    103,960,612
    
    
    $
    558,564
    
    
    
    2.15
    
    
    $
    99,109,236
    
    
    $
    725,701
    
    
    
    2.93NOW and money market accounts
    
    
    7,841,863
    
    
    
    2,941
    
    
    
    0.15
    
    
    
    7,879,946
    
    
    
    6,262
    
    
    
    0.32Savings
    
    
    23,266,692
    
    
    
    19,751
    
    
    
    0.34
    
    
    
    21,927,211
    
    
    
    34,909
    
    
    
    0.64Total interest-bearing deposits
    
    
    135,069,167
    
    
    
    581,256
    
    
    
    1.72
    
    
    
    128,916,393
    
    
    
    766,872
    
    
    
    2.38Other interest-bearing liabilities
    
    
    266,519
    
    
    
    6
    
    
    
    0
    
    
    
    244,493
    
    
    
    11
    
    
    
    0.02Total interest-bearing liabilities
    
    
    135,335,686
    
    
    
    581,262
    
    
    
    1.72
    
    
    
    129,160,886
    
    
    
    766,883
    
    
    
    2.37Non-interest-bearing deposits
    
    
    5,499,411
    
    
    
    
    
    
    
    
    
    
    
    4,919,000Other non-interest-bearing liabilities
    
    
    499,604
    
    
    
    
    
    
    
    
    
    
    
    534,847Total liabilities
    
    
    141,334,701
    
    
    
    
    
    
    
    
    
    
    
    134,614,733Total equity
    
    
    9,259,943
    
    
    
    
    
    
    
    
    
    
    
    9,399,532Total liabilities and equity
    
    $
    150,594,644
    
    
    
    
    
    
    
    
    
    
    $
    144,014,265Net interest income
    
    
    
    
    
    $
    919,061
    
    
    
    
    
    
    
    
    
    
    $
    930,088Interest rate spread
    
    
    
    
    
    
    
    
    
    
    2.49
    %
    
    
    
    
    
    
    
    
    
    
    2.55
    %Net interest margin
    
    
    
    
    
    
    
    
    
    
    2.58
    %
    
    
    
    
    
    
    
    
    
    
    2.70
    %Average interest-earning assets to average
interest-bearing liabilities
    
    
    
    
    
    
    
    
    
    
    105.44
    %
    
    
    
    
    
    
    
    
    
    
    106.75
    %
  18




---



##### Table of Contents



Provision for Loan Losses.
 Noninterest Revenue.
 Noninterest Expenses.
 Income Tax Expense.
 Results of Operations for the Six Months Ended September 30, 2010 and 2009
 Overview.
 Net Interest Income.
    19




---



##### Table of Contents



Average Balance and Yields
  20




---



##### Table of Contents



Six Months EndedSeptember 30,2010
    
    
    2009Interest
    
    
    
    
    
    
    
    
    
    
    InterestAverage
    
    
    and
    
    
    Yield/
    
    
    Average
    
    
    and
    
    
    Yield/Balance
    
    
    Dividends
    
    
    Cost
    
    
    Balance
    
    
    Dividends
    
    
    CostAssets:Cash and cash equivalents
    
    $
    16,475,542
    
    
    $
    19,296
    
    
    
    0.23
    %
    
    $
    18,613,636
    
    
    $
    17,413
    
    
    
    0.19
    %Investment securities held-to-maturity
    
    
    1,977,524
    
    
    
    47,635
    
    
    
    4.82
    
    
    
    3,010,652
    
    
    
    233,701
    
    
    
    15.52Investment securities available-for-sale (1)
    
    
    33,145,032
    
    
    
    442,963
    
    
    
    2.67
    
    
    
    25,821,783
    
    
    
    423,176
    
    
    
    3.28Loans receivable, net
    
    
    89,788,089
    
    
    
    2,537,874
    
    
    
    5.65
    
    
    
    89,006,436
    
    
    
    2,518,789
    
    
    
    5.66Other interest-earning assets
    
    
    242,500
    
    
    
    422
    
    
    
    0.35
    
    
    
    242,500
    
    
    
    508
    
    
    
    0.42Total interest-earning assets
    
    
    141,628,687
    
    
    
    3,048,190
    
    
    
    4.30
    
    
    
    136,695,007
    
    
    
    3,193,587
    
    
    
    4.67Non-interest-earning assets
    
    
    7,660,945
    
    
    
    
    
    
    
    
    
    
    
    6,369,135Total assets
    
    $
    149,289,632
    
    
    
    
    
    
    
    
    
    
    $
    143,064,142Liabilities and equity:Time deposits
    
    $
    102,500,840
    
    
    $
    1,137,712
    
    
    
    2.22
    
    
    $
    98,121,165
    
    
    $
    1,559,502
    
    
    
    3.18NOW and money market accounts
    
    
    7,689,100
    
    
    
    5,906
    
    
    
    0.15
    
    
    
    7,765,058
    
    
    
    14,242
    
    
    
    0.37Savings
    
    
    23,473,812
    
    
    
    40,451
    
    
    
    0.34
    
    
    
    21,847,520
    
    
    
    74,255
    
    
    
    0.68Total interest-bearing deposits
    
    
    133,663,752
    
    
    
    1,184,069
    
    
    
    1.77
    
    
    
    127,733,743
    
    
    
    1,647,999
    
    
    
    2.58Other interest-bearing liabilities
    
    
    517,899
    
    
    
    40
    
    
    
    0.02
    
    
    
    501,143
    
    
    
    48
    
    
    
    0.02Total interest-bearing liabilities
    
    
    134,181,651
    
    
    
    1,184,109
    
    
    
    1.76
    
    
    
    128,234,886
    
    
    
    1,648,047
    
    
    
    2.57Non-interest-bearing deposits
    
    
    5,524,164
    
    
    
    
    
    
    
    
    
    
    
    4,846,556Other non-interest-bearing liabilities
    
    
    426,770
    
    
    
    
    
    
    
    
    
    
    
    505,929Total liabilities
    
    
    140,132,585
    
    
    
    
    
    
    
    
    
    
    
    133,587,371Total equity
    
    
    9,157,047
    
    
    
    
    
    
    
    
    
    
    
    9,476,771Total liabilities and equity
    
    $
    149,289,632
    
    
    
    
    
    
    
    
    
    
    $
    143,064,142Net interest income
    
    
    
    
    
    $
    1,864,081
    
    
    
    
    
    
    
    
    
    
    $
    1,545,540Interest rate spread
    
    
    
    
    
    
    
    
    
    
    2.54
    %
    
    
    
    
    
    
    
    
    
    
    2.10
    %Net interest margin
    
    
    
    
    
    
    
    
    
    
    2.63
    %
    
    
    
    
    
    
    
    
    
    
    2.26
    %Average interest-earning assets to average
interest-bearing liabilities
    
    
    
    
    
    
    
    
    
    
    105.55
    %
    
    
    
    
    
    
    
    
    
    
    106.60
    %
  21




---



##### Table of Contents



Provision for Loan Losses.
 Noninterest Revenue.
 Noninterest Expenses.
 Income Tax Expense.
 Liquidity and Capital Resources
 Liquidity Management.
     22




---



##### Table of Contents



Capital Management.
  Off-Balance Sheet Arrangements.
  
 Item 3. Quantitative and Qualitative Disclosure About Market Risk
  
 Item 4. Controls and Procedures
   23




---



##### Table of Contents



PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. [Removed and Reserved]
  
 Item 5. Other Information.
  
 Item 6. Exhibits
 3.1
    
    
    Articles of Incorporation of Madison Bancorp, Inc. (1)3.2
    
    
    Bylaws of Madison Bancorp, Inc. (2)4.0
    
    
    Form of Stock Certificate of Madison Bancorp, Inc. (3)31.1
    
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer and Chief Financial Officer32.0
    
    
    Section 1350 Certification
 
 (1)
    
    Incorporated herein by reference to Exhibit 3.1 to the Companys Registration
Statement on Form S-1 (File No. 333-167455), as amended, initially filed with the
Securities and Exchange Commission on June 11, 2010.(2)
    
    Incorporated herein by reference to Exhibit 3.2 to the Companys Registration
Statement on Form S-1 (File No. 333-167455), as amended, initially filed with the
Securities and Exchange Commission on June 11, 2010.(3)
    
    Incorporated herein by reference to Exhibit 4 to the Companys Registration
Statement on Form S-1 (File No. 333-167455), as amended, initially filed with the
Securities and Exchange Commission on June 11, 2010.  24




---



##### Table of Contents



SIGNATURES
  MADISON BANCORP, INC.Dated:      November 12, 2010
    By:
    /s/ Michael P. GavinMichael P. GavinPresident and Chief Executive Officer,
Chief Financial Officer and Director
(principal executive officer and principal financial and accounting officer)  25