<PAGE> 1

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

                                   FORM 10-Q

(Mark One)

[X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
      SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended March 31, 2000
                                      or

[  ]  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 0-25664

SGV BANCORP, INC.
--------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)

DELAWARE                                                          95-4524789
--------------------------------------------------------------------------------
(State or other jurisdiction of incorporation                (I. R. S. Employer
or organization)                                             Identification No.)

225 NORTH BARRANCA STREET, WEST COVINA, CALIFORNIA                     91791
--------------------------------------------------------------------------------
(Address of principal executive offices)

                                (626) 859-4200
--------------------------------------------------------------------------------
             (Registrant's telephone number, including area code)

Not Applicable
--------------------------------------------------------------------------------
                (Former name, former address and former fiscal year,
                       if changed since last report)

      Indicate by check mark  whether the  registrant  (1) has filed all reports
require  to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.   /X/ Yes /  / No

                    APPLICABLE ONLY TO CORPORATE ISSUERS:
      Indicate the number of shares  outstanding of each of the issuer's classes
of common stock, as of the latest  practicable date:  2,221,871 shares of common
stock, par value $0.01 per share, were outstanding as of May 9, 2000.


<PAGE> 2



                              SGV BANCORP, INC.
                                  FORM 10-Q
                                    INDEX


PART I      FINANCIAL INFORMATION                                       PAGE

Item 1      Consolidated Statements of Financial Condition:
            March 31, 2000 (unaudited) and June 30, 1999......................1

            Consolidated Statements of Operations (unaudited):
            For the Nine Months Ended March 31, 2000 and 1999 and for the
            Three Months Ended March 31, 2000 and 1999........................2

            Consolidated Statements of Cash Flows (unaudited):
            For the Nine Months Ended March 31, 2000 and 1999.................3

            Notes to Consolidated Financial Statements........................5

Item 2      Management's Discussion and Analysis of
            Results of Operations and Financial Condition.....................7

Item 3      Quantitative and Qualitative Disclosure Regarding Market Risk....16

PART II     OTHER INFORMATION

Item 1      Legal Proceedings................................................20

Item 2      Changes in Securities............................................20

Item 3      Defaults Upon Senior Securities..................................20

Item 4      Submission of Matters to a Vote of Security Holders..............20

Item 5      Other Information................................................20

Item 6      Exhibits and Reports on Form 8-K.................................20

SIGNATURES  .................................................................21




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<TABLE>
<CAPTION>



SGV BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In thousands, except share data)
-------------------------------------------------------------------------------------------------------
                                                                            MARCH 31,         JUNE 30,
                                                                              2000              1999
                                                                           (Unaudited)

<S>                                                                        <C>             <C>
ASSETS:
 Cash and cash equivalents, including short-term bank obligations of
  $4,615 at March 31, 2000 and $4,940 at June 30, 1999                     $     9,919     $     9,515
 Investment securities available for sale, amortized cost of $37,557
  at March 31, 2000 and $26,109 at June 30, 1999                                36,878          25,816
 Mortgage-backed securities available for sale, amortized cost of
  $22,129 at March 31, 2000 and $25,326 at June 30, 1999                        21,360          24,871
 Mortgage-backed securities held to maturity, estimated fair value of
  $37,499 at March 31, 2000 and $36,984 at June 30, 1999                        38,839          37,717
 Loans receivable held for sale                                                    832             100
 Loans receivable held for investment, net of allowance for loan losses of
  $2,024 at March 31, 2000 and $1,845 at June 30, 1999                         371,651         354,989
 Accrued interest receivable                                                     3,015           2,979
 Stock of Federal Home Loan Bank of San Francisco, at cost                       5,629           5,407
 Real estate acquired through foreclosure, net                                     738             827
 Premises and equipment, net                                                     3,389           3,166
 Prepaid expenses and other assets, net                                          4,357           3,343
                                                                          -------------   -------------
     Total assets                                                          $   496,607     $   468,730
                                                                          =============   =============

LIABILITIES AND STOCKHOLDERS' EQUITY:
 LIABILITIES:
 Deposit accounts                                                          $   364,462     $   324,106
 Federal Home Loan Bank advances                                                93,877         108,002
 Securities sold under agreements to repurchase
 Accrued expenses and other liabilities                                          3,404           4,251
                                                                          -------------   -------------
     Total liabilities                                                         461,743         436,359

 STOCKHOLDERS' EQUITY:
 Preferred stock, $.01 par value; 2,000,000 shares authorized; none issued
 Common stock, $.01 par value; 10,000,000 shares authorized;
   2,727,656 issued; 2,221,871 shares outstanding at March 31, 2000
   and 2,176,323 shares outstanding at June 30, 1999                                27              27
 Additional paid-in capital                                                     21,628          21,297
 Retained earnings, substantially restricted                                    20,932          19,236
 Accumulated other comprehensive income                                           (812)           (440)
 Deferred stock compensation                                                      (849)         (1,141)
 Treasury stock; 505,785 shares at March 31, 2000
   and 551,333 at June 30, 1999                                                 (6,062)         (6,608)
                                                                          --------------  -------------
     Total stockholders' equity                                                 34,864          32,371
                                                                          --------------  -------------
     Total liabilities and stockholders' equity                            $   496,607     $   468,730
                                                                          ==============  =============

</TABLE>



                                                       1


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<TABLE>
<CAPTION>


CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)(Unaudited)

                                                        For the Three Months    For the Nine Months
                                                           Ended March 31,         Ended March 31,
                                                           2000        1999        2000       1999
<S>                                                     <C>         <C>         <C>         <C>
INTEREST INCOME:
  Interest on loans                                     $  7,138    $  6,707    $ 20,893    $ 19,363
  Interest on investment securities                          553         403       1,724       1,051
  Interest on mortgage-backed securities                   1,001         888       2,948       2,892
  Other                                                      117          97         371         452
                                                        --------    --------    --------    --------
      Total interest income                                8,809       8,095      25,936      23,758
                                                        --------    --------    --------    --------

INTEREST EXPENSE:
  Interest on deposit accounts                             3,793       3,367      11,207      10,206
  Interest on borrowings                                   1,328       1,511       4,030       4,379
                                                        --------    --------    --------    --------
      Total interest expense                               5,121       4,878      15,237      14,585
                                                                                --------    --------

Net interest income before provision for loan losses       3,688       3,217      10,699       9,173
PROVISION FOR LOAN LOSSES                                    150         280         520         759
                                                        --------    ---------   --------    --------
Net interest income after provision for loan losses        3,538       2,937      10,179       8,414

OTHER INCOME (EXPENSE):
  Loan servicing and other fees                              102         132        359         428
  Deposit account fees                                       196         143        592         431
  Secondary marketing activity, net                            3          28         17          89
  Gain on sale or redemption of securities
    available for sale, net                                   58          28         94          35
  Other income                                               151         139        462         393
                                                        --------    --------    -------     -------
      Total other income                                     510         470      1,524       1,376
                                                        --------    --------    -------     -------

OTHER EXPENSES:
  Compensation and other employee expenses                 1,588       1,299      4,544       3,777
  Office occupancy                                           274         244        824         779
  Data Processing and Equipment                              312         286        971         861
  Advertising                                                 60          40        180         108
  FDIC insurance premiums                                     19          45        113         132
  Merger-related expenses                                     33                    420
  Other operating expenses                                   506         349      1,578       1,101
                                                        --------    --------    -------     -------
      Total general and administrative expenses            2,792       2,263      8,630       6,758
  Net loss (gain) on real estate acquired
    through foreclosure                                        5         (28)       (43)       (163)
                                                        --------    --------    -------     -------
      Total other expenses                                 2,797       2,235      8,587       6,595
                                                        --------    ---------   --------    -------

EARNINGS BEFORE INCOME TAXES                               1,251       1,172      3,116       3,195
INCOME TAXES                                                 516         471      1,420       1,304
                                                        --------    --------    -------    --------
      NET EARNINGS                                      $    735    $    701    $ 1,696    $  1,891
                                                        ========    ========    =======    ========
EARNINGS PER SHARE - Basic                              $   0.33    $   0.32    $  0.77    $   0.85
                                                        ========    ========    =======    ========
EARNINGS PER SHARE - Diluted                            $   0.31    $   0.31    $  0.72    $   0.82
                                                        ========    ========    =======    ========

</TABLE>




                                                    2

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<TABLE>
<CAPTION>

SGV BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands) (Unaudited)
-----------------------------------------------------------------------------------------------------------------------

                                                                                             For the Nine Months
                                                                                               Ended March 31,

                                                                                           2000                1999
                                                                                   --------------       -------------

<S>                                                                                    <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net earnings                                                                          $   1,696           $   1,891
 Adjustments to reconcile net earnings to net cash provided by operating
  activities:
   Depreciation and amortization                                                             693                 503
   Loans originated for sale                                                              (4,336)            (16,402)
   Proceeds from sale of loans                                                             5,291              15,619
   Gain on sale of loans, net                                                                (23)               (113)
   Gain on sale of investments available for sale, net                                       (94)                (38)
   Gain on sale of mortgage-backed securities available for sale, net                                             (2)
   Federal Home Loan Bank stock dividend                                                    (222)               (198)
   Increase in prepaid expenses and other assets                                          (1,210)             (2,206)
   Amortization of deferred loan fees                                                       (103)               (224)
   Deferred loan origination costs                                                          (182)               (343)
   (Decrease) increase in accrued expenses and other liabilities                            (518)                406
   Provision for loan losses                                                                 520                 759
   Provision for (recapture of) real estate losses                                             3                 (52)
   Premium amortization, net                                                                 248                 622
   Decrease in accrued interest receivable                                                   (36)               (201)
   Other, net                                                                                163                 222
                                                                                    -------------        ------------
    Net cash provided by operating activities                                              1,890                 243

CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchase of investment securities available for sale                                    (60,000)            (83,273)
 Proceeds from sale and redemption of investment securities available for sale            48,584              85,892
 Purchase of mortgage-backed securities available for sale                                                   (10,153)
 Proceeds from sale of mortgage-backed securities available for sale                                           6,931
 Purchase of mortgage-backed securities held to maturity                                  (5,531)            (15,060)
 Principal repayments on mortgage-backed securities                                        7,516              18,667
 Loans funded, net                                                                       (38,037)            (58,291)
 Loans purchased, net                                                                    (16,951)            (70,963)
 Principal repayments on loans                                                            36,266              71,714
 Proceeds from sale of real estate                                                           737               2,687
 Purchase of premises and equipment                                                         (679)               (137)
 Purchase of Federal Home Loan Bank Stock                                                                       (906)
 Other, net                                                                                 (791)                (63)
                                                                                    -------------        ------------
    Net cash used in investing activities                                                (28,886)            (52,955)

</TABLE>




                                                            3


<PAGE> 6

<TABLE>
<CAPTION>





SGV BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands) (Unaudited)(Continued)
----------------------------------------------------------

                                                                         For the Nine Months
                                                                           Ended March 31,
                                                              ------------------------------------

                                                                      2000                1999
                                                              ----------------     ---------------
<S>                                                               <C>                <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
 Net decrease in certificate accounts                             $     (800)        $   (15,676)
 Net increase in passbook, money market savings
   NOW and non-interest-bearing accounts                               4,354              44,323
 Purchase of deposit accounts                                         36,802
 Proceeds from Federal Home Loan Bank advances                        14,000              59,500
 Repayment of Federal Home Loan Bank advances                        (28,126)            (26,097)
 Proceeds from securities sold under agreements to repurchase                              4,300
 Repayment of securities sold under agreements to repurchase                             (10,300)
 Exercise of stock options                                               479
 Purchase of treasury stock                                                               (2,547)
 Other, net                                                              691                 489
                                                              ----------------     ---------------
    Net cash provided by financing activities                         27,400              53,992

NET INCREASE IN CASH AND CASH EQUIVALENTS                                404               1,280

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                         9,515              20,008
                                                              ----------------     ---------------

CASH AND CASH EQUIVALENTS, END OF PERIOD                          $    9,919         $    21,288
                                                              ================     ===============


SUPPLEMENTAL CASH FLOW DISCLOSURES
 Cash paid during the period for:
Interest                                                          $   15,212         $    14,570
Income taxes, net                                                      1,475               1,510

NONCASH INVESTING ACTIVITIES DURING THE PERIOD:
Real estate acquired through foreclosure                                 628               2,241
Change in net unrealized loss on investment securities and
  mortgage-backed securities available for sale, net of taxes           (372)                (84)

</TABLE>







                                                  4



<PAGE> 7




                       SGV BANCORP, INC. AND SUBSIDIARY
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                MARCH 31, 2000
                                 (UNAUDITED)

1.    BASIS OF PRESENTATION
      ---------------------

         The accompanying  unaudited  consolidated  financial statements include
the  accounts  of  SGV  Bancorp,  Inc.  (the  "Company")  and  its  wholly-owned
subsidiary,  First Federal  Savings and Loan  Association  of San Gabriel Valley
(the  "Association")  and its  wholly-owned  subsidiary,  First  Covina  Service
Company.  The interim  consolidated  financial  statements have been prepared in
accordance with generally accepted  accounting  principles for interim financial
information and with the  instructions to Form 10-Q and Article 10 of Regulation
S-X.  Accordingly,  they do not include  all of the  information  and  footnotes
required by generally  accepted  accounting  principles  for complete  financial
statements.  In the opinion of management all necessary adjustments,  consisting
only of normal recurring adjustments necessary for a fair presentation have been
included.  The results of operations for the three and nine-month  periods ended
March  31,  2000  are not  necessarily  indicative  of the  results  that may be
expected for the entire fiscal year.

         These unaudited  consolidated  financial statements and the information
under the heading "Management's Discussion and Analysis of Results of Operations
and  Financial  Condition"  should  be  read in  conjunction  with  the  audited
consolidated financial statements and notes thereto of SGV Bancorp, Inc. for the
year ended June 30, 1999  included in the  Company's  Annual Report on Form 10-K
for the fiscal year ended June 30, 1999.

2.    EARNINGS PER SHARE
      ------------------

      Earnings per share reconciliation is as follows:
<TABLE>
<CAPTION>

                                                                        WEIGHTED
                                                                        AVERAGE
                                                     INCOME              SHARES           PER SHARE
                                                   (NUMERATOR)       (DENOMINATOR)          AMOUNT


                                                          THREE MONTHS ENDED MARCH 31, 2000

BASIC EPS
<S>                                               <C>                  <C>                <C>
  Income available to common stockholders         $     735,000        2,222,000          $   0.33
Effect of Dilutive Securities
  Incremental shares from assumed exercise
    of outstanding options                                  -            146,000             (0.02)
Diluted EPS
  Income available to common stockholders         $     735,000        2,368,000          $   0.31
                                                  ================   ==============   ===============
</TABLE>

<TABLE>
<CAPTION>

                                                          NINE MONTHS ENDED MARCH 31, 2000

<S>                                               <C>                  <C>                <C>
BASIC EPS
  Income available to common stockholders         $   1,696,000        2,195,000          $   0.77
Effect of Dilutive Securities
  Incremental shares from assumed exercise
    of outstanding options                                -              157,000             (0.05)
Diluted EPS
  Income available to common stockholders         $   1,696,000        2,352,000          $   0.72
                                                  ================   ==============  ================
</TABLE>


                                                           5


<PAGE> 8
<TABLE>
<CAPTION>


                                                        THREE MONTHS ENDED MARCH 31, 1999

<S>                                               <C>               <C>              <C>
BASIC EPS
  Income available to common stockholders         $    701,000      2,179,000        $   0.32
Effect of Dilutive Securities
  Incremental shares from assumed exercise
    of outstanding options                                -            56,000           (0.01)
Diluted EPS
  Income available to common stockholders         $    701,000      2,235,000        $   0.31
                                                  ==============  =============   =============

                                                        NINE MONTHS ENDED MARCH 31, 1999
BASIC EPS
<S>                                               <C>               <C>              <C>
  Income available to common stockholders         $  1,891,000      2,231,000        $   0.85
Effect of Dilutive Securities
  Incremental shares from assumed exercise
    of outstanding options                                -            74,000           (0.03)
Diluted EPS
  Income available to common stockholders         $  1,891,000      2,305,000        $   0.82
                                                  ==============  =============   =============
</TABLE>


Comprehensive Income
--------------------

         The Company  adopted  Statement of Financial  Accounting  Standards No.
130,  REPORTING  COMPREHENSIVE  INCOME,  effective  July 1, 1998.  The  standard
requires  that  comprehensive  income and its  components  be  disclosed  in the
financial  statements.  The Company's  comprehensive  income  includes all items
which   comprise   net   income   plus  the   unrealized   holding   losses   on
available-for-sale  securities. For the three months and nine months ended March
2000 and 1999, the Company's comprehensive income was as follows:

<TABLE>
<CAPTION>

                                                                      FOR THE THREE MONTHS ENDED
                                                          MARCH 31, 2000                       MARCH 31, 1999
                                                                        (Dollars in thousands)
     <S>                                                       <C>                                 <C>
     Net income                                                $ 735                               $ 701
     Other comprehensive loss                                    (80)                                (16)
         Total comprehensive income                            $ 655                               $ 685
                                                      =======================             =======================
</TABLE>
<TABLE>
<CAPTION>
                                                                       FOR THE NINE MONTHS ENDED
                                                          MARCH 31, 2000                       MARCH 31, 1999
                                                                        (Dollars in thousands)
     <S>                                                     <C>                                 <C>
     Net income                                              $ 1,696                             $ 1,891
     Other comprehensive loss                                   (372)                                (84)
         Total comprehensive income                          $ 1,324                             $ 1,807
                                                      =======================             =======================
</TABLE>


Accounting Principles
---------------------

         SFAS  No.  133,  ACCOUNTING  FOR  DERIVATIVE  INSTRUMENTS  AND  HEDGING
ACTIVITIES,  was issued in June 1998 and  establishes  accounting  and reporting
standards for derivative  instruments,  including certain derivative instruments
embedded in other contracts,  (collectively  referred to as derivatives) and for
hedging activities.  SFAS No. 133 is effective for all fiscal quarters of fiscal
years  beginning  after June 15, 1999. In July 1999,  the  Financial  Accounting
Standards   Board  (FASB)  issued  SFAS  No.  137,   ACCOUNTING  FOR  DERIVATIVE
INSTRUMENTS  AND HEDGING  ACTIVITIES  - DEFERRAL OF THE  EFFECTIVE  DATE OF FASB
STATEMENT  NO. 133,  which delays the  effective  date of SFAS No. 133 to fiscal
years beginning after June 15, 2000. Earlier  application is encouraged,  but it
is permitted  only as of the  beginning



                                                       6

<PAGE> 9



of any  fiscal  quarter  that  begins  after  June  1998.  The  adoption  of the
provisions  of SFAS No. 133 as amended by SFAS No. 137 is not expected to have a
material  impact on the results of operations  or the financial  position of the
Company.

5.       USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS
         -----------------------------------------------------------

         The  preparation of financial  statements in conformity  with generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.


Item 2.  Management's Discussion and Analysis of Results of Operations and
         -----------------------------------------------------------------
         Financial Condition
         -------------------

         This Management's Discussion and Analysis should be read in conjunction
with the Management's  Discussion and Analysis contained in the Company's Annual
Report on Form 10-K,  which focuses upon relevant  matters  occurring during the
year ended June 30, 1999.  Accordingly,  the ensuing discussion focuses upon the
material  matters at and for the three  months and nine  months  ended March 31,
2000.

GENERAL
-------

         The  principal  business of the Company is attracting  retail  deposits
from the  general  public and  investing  those  deposits,  together  with funds
generated  from  operations  and  borrowings,  primarily in one- to  four-family
residential mortgage loans. To a lesser extent, the Company engages in secondary
marketing  activities  and  invests in  multi-family,  commercial  real  estate,
construction,  land and consumer  loans.  Loan sales come from loans held in the
Company's  portfolio  designated as being held for sale or originated during the
period and being so  designated.  The  Company  has  historically  retained  the
servicing  rights of loans  sold,  although  it has  recently  sold loans to the
secondary  market on a servicing  released  basis.  The  Company's  revenues are
derived principally from interest on its mortgage loans, and to a lesser extent,
interest and dividends on its  investment  and  mortgage-backed  securities  and
income from loan servicing. The Company's primary sources of funds are deposits,
principal and interest  payments on loans,  advances  from the FHLB,  securities
sold under  agreements to repurchase and, to a lesser extent,  proceeds from the
sale of loans.

RECENT DEVELOPMENTS - ACQUISITION BY INDYMAC MORTGAGE HOLDINGS, INC.
--------------------------------------------------------------------

         On July 12,  1999,  the  Company and IndyMac  Mortgage  Holdings,  Inc.
("IndyMac")  entered into a definitive  agreement pursuant to which IndyMac will
acquire  the  Company for cash.  Under the terms of the merger  agreement,  each
share of the  Company's  common stock will be  exchangeable  for $25.00 in cash.
This  price may be  subject  to  adjustment  as a result of  changes  in the net
portfolio  value of certain assets and  liabilities of the Company.  In no event
will the purchase  price be reduced  below $22.50 or increased  above $27.50 per
share.  Based  upon a per share  price of  $25.00,  IndyMac  will pay a total of
approximately  $62.5 million to acquire all of the Company's shares  outstanding
and  subject to options.  In  accordance  with the terms of the  amended  merger
agreement,  IndyMac will be the surviving  entity of the merger.  The merger has
been approved by the shareholders of both companies in separate special meetings
held on December  14, 1999.  The merger  still  requires the approval of certain
regulatory  agencies.  The  merger is  expected  to be  completed  in the second
quarter of calendar 2000.

RESULTS OF OPERATIONS
---------------------

         The Company  posted net earnings of $735,000 for the three months ended
March 31, 2000  compared to net  earnings of $701,000 for the three months ended
March 31,  1999.  In regard to basic  earnings  per share,  for the three months
ended March 31, 2000,  net earnings were $0.33 compared to net earnings of $0.32
for the three months  ended March 31, 1999.  For the nine months ended March 31,
2000,  net  earnings  were $1.7 million as



                                       7

<PAGE> 10


compared to $1.9 million for the nine months ended March 31, 1999. In  regard to
basic earnings per share, for the nine months ended March 31, 2000, net earnings
were $0.77 compared to net earnings of $0.85 for the nine months ended March 31,
1999.  The  net earnings for the three and nine  months  ended  March  31,  2000
included approximately $33,000 and $420,000, respectively, in expenses  incurred
in  connection  with the pending merger with  IndyMac  Mortgage  Holdings,  Inc.
(such costs are not  considered deductible under current tax laws; therefore, no
tax benefit has been provided).

Net Interest Income
-------------------

         Net  interest  income  before the  provision  for loan  losses was $3.7
million for the three months  ended March 31, 2000  compared to $3.2 million for
the three months ended March 31, 1999. For the nine months ended March 31, 2000,
net interest  income was $10.7  million as compared to $9.2 million for the nine
months ended March 31, 1999.

Interest Income
---------------

         Total  interest  income for the three  months  ended March 31, 2000 was
$8.8 million, an increase of $714,000 from the comparable period a year ago. The
increase in interest  income was primarily due to the $28.9 million  increase in
the average balance of  interest-earning  assets to $475.9 million for the three
months ended March 31, 2000 from $447.0 million for the three months ended March
31, 1999. The majority of the growth in interest-earning assets is attributed to
the savings account  acquisition  from Citibank,  California,  a federal savings
bank, in July 1999. The interest  income on loans  increased to $7.1 million for
the three  months  ended March 31, 2000 from $6.7  million for the three  months
ended March 31, 1999. The increase in interest on loans was due primarily to the
increase  in the  average  balance  of loans  receivable  outstanding  to $371.9
million for the three  months  ended March 31, 2000 from $351.4  million for the
three months ended March 31, 1999.  The increase was also due to the increase in
the average yield on loans  receivable to 7.68% for the three months ended March
31,  2000  compared to 7.63% for the three  months  ended  March 31,  1999.  The
increase in yield on the loan portfolio was partially due to the increase in the
percentage of  non-residential  mortgage  loans  (normally  have higher  overall
yields  than   single-family   residential   mortgage   loans)  which  comprised
approximately 23% of the total portfolio at March 31, 2000 versus  approximately
15% at March 31, 1999. The interest income on mortgage-backed securities totaled
$1.0  million for the three months  ended March 31,  2000,  surpassing  the $0.9
million  posted for the  comparable  period a year ago.  This  increase  was due
primarily to the increase in the average yield on mortgage-backed  securities to
6.66% for the three  months  ended March 31, 2000 from 5.97% for the  comparable
period a year  ago.  The  increase  in yield  was due  partially  to the  higher
interest rate  environment in the three months ended March 31, 2000 resulting in
a substantial  decrease in prepayment  speeds and  therefore,  a decrease in the
amortization of premiums on purchased mortgage-backed  securities.  The interest
income on investment  securities and other securities  increased to $670,000 for
the three months  ended March 31, 2000 from  $500,000 for the same period a year
ago  primarily  as a result of the  increase  in the  average  balances  of such
securities to $43.9 million for the three months ended March 31, 2000 from $36.1
million for the same period a year ago and due to the increase in average  yield
to 6.10% for the three  months  ended  March  31,  2000 from  5.55% for the same
period a year ago due primarily to the increase in short-term  interest rates in
the current period.

         Total  interest  income  for the  nine  months  ended  March  31,  2000
increased to $25.9 million,  representing a 9.2% increase from the $23.8 million
in  interest  income for nine  months  ended  March 31,  1999.  The  increase in
interest  income was due primarily to the $44.6 million  increase in the average
balance of  interest-earning  assets to $474.5 million for the nine months ended
March 31, 2000.  Partially  offsetting  this  increase was the  reduction in the
overall  yield on  interest-earning  assets to 7.29% for the nine  months  ended
March 31, 2000 from 7.37% for the same period a year ago. Total interest  income
on loans  receivable  increased to $20.9 million for the nine months ended March
31,  2000,  an increase of $1.5  million  from the same period a year ago.  This
increase was due to the $32.1 million  increase in the average  balance of loans
receivable to $366.5 million for the nine months ended March 31, 2000, partially
offset by the 12 basis point  reduction  in the  average  yield to 7.60% for the
current period.  Interest  income on the  mortgage-backed  securities  portfolio
reflected a slight increase of $56,000 to $2.9 million for



                                        8

<PAGE> 11

the nine months  ended March 31,  2000,  due  primarily  to the  increase in the
average  yield to 6.52% for the nine months  ended March 31, 2000 from 6.21% for
the same period a year ago. The increase in yield on mortgage-backed  securities
was primarily due to the higher interest rate  environment  during the last nine
months as  compared  to the nine months  ended  March 31,  1999  resulting  in a
substantial   decrease  in  the  amortization  of  premiums  on  mortgage-backed
securities  and therefore,  a higher  overall yield.  Interest on investment and
other  securities  increased to $2.1 million for the nine months ended March 31,
2000 from $1.5 million for the same period a year ago.  This increase was due to
the increase in the average balance of investment and other  securities to $47.6
million for the nine months ended March 31, 2000 from $33.4 million for the same
period a year  ago,  partially  offset  by the 14 basis  point  decrease  in the
average yield to 5.87% for the current period.  The decline in the overall yield
on  investment  and  other  securities  was the  result  of  maintaining  higher
short-term  investments as a result of the acquisition of deposits from Citibank
and the desire to maintain  higher  liquidity in  anticipation  of a higher than
usual need for cash due to Y2K.

Interest Expense
----------------

         Total  interest  expense for the three  months ended March 31, 2000 was
$5.1  million,  an increase  from the $4.9  million in interest  expense for the
three  months  ended  March 31,  1999.  The  increase  in  interest  expense was
primarily  due to  the  increase  in the  average  balance  of  interest-bearing
liabilities  to $437.9  million  for the three  months  ended  March 31, 2000 as
compared to $415.7  million for the three months ended March 31, 1999.  Interest
expense on deposit accounts increased to $3.8 million for the three months ended
March 31, 2000 from $3.4 million for the same period a year ago.  This  increase
was  related  to  the  $35.5  million   increase  in  the  average   balance  of
interest-bearing  deposit  accounts to $343.4 million for the three months ended
March  31,  2000  due   primarily   to  the   acquisition   of  $35  million  in
interest-bearing  deposit  accounts from Citibank in July 1999.  The increase in
interest  expense was also due to the slight  increase  in the  average  cost of
deposit  accounts to 4.42% for the three  months ended March 31, 2000 from 4.37%
for the same period a year ago.  Interest  expense on  borrowings  decreased  by
$183,000 to $1.3  million for the three  months  ended March 31, 2000 due to the
$13.3 million decrease in the average balance of borrowings to $94.5 million for
the three months ended March 31, 2000. The Company reduced its borrowings in the
current  period  primarily  as a result of the cash  received  from the  deposit
acquisition from Citibank in July 1999.

         Total  interest  expense for the nine  months  ended March 31, 2000 was
$15.2 million, representing a $652,000 increase from the $14.6 million total for
the same period a year ago. The increase in interest  expense was due  primarily
to the  $40.7  million  increase  in the  average  balance  of  interest-bearing
liabilities  to  $437.8  million  for the nine  months  ended  March  31,  2000,
substantially  offset by the 26 basis  point  decrease  in the  average  cost of
interest-bearing  liabilities to 4.64% for the current period.  Interest expense
on deposit  accounts  increased to $11.2 million for the nine months ended March
31, 2000 from $10.2  million for the same period a year ago.  This  increase was
due to the $45.0 million  increase in the average balance of deposit accounts to
$342.0 million for the nine months ended March 31, 2000, partially offset by the
21 basis point decrease in the average cost of deposits to 4.37% for the current
period.  Interest  expense on  borrowings  declined to $4.0 million for the nine
months ended March 31, 2000 from $4.4 million for the same period a year ago due
to the $4.3  million  decline  in the  average  balance of  borrowings  to $95.8
million  for the nine  months  ended  March 31,  2000 and to the 22 basis  point
decline in the average  cost of  borrowings  to 5.61% for the nine months  ended
March 31, 2000.




                                      9

<PAGE> 12



Analysis of Net Interest Income
-------------------------------

         The following table sets forth average  interest rates on the Company's
interest-earning assets and interest-bearing liabilities for the three month and
nine month  periods  ended  March 31, 2000 and March 31,  1999  (dollars  are in
thousands and average balances are based on month-end amounts):
<TABLE>
<CAPTION>

                                             FOR THE THREE MONTHS ENDED                    FOR THE NINE MONTHS ENDED
                                                      MARCH 31,                                    MARCH 31,
                                             2000                   1999                  2000                   1999
                                     AVERAGE      YIELD     AVERAGE      YIELD     AVERAGE      YIELD     AVERAGE     YIELD
                                     BALANCE      RATE      BALANCE      RATE      BALANCE      RATE      BALANCE      RATE

<S>                                   <C>           <C>      <C>           <C>      <C>           <C>      <C>          <C>
ASSETS:
  Interest-earning assets:
    Loans receivable                  $371,885      7.68%    $351,441      7.63%    $366,523      7.60%    $334,428     7.72%
    Mortgage-backed securities          60,101      6.66       59,472      5.97       60,327      6.52       62,103     6.21
    Investment securities and
     other                              43,935      6.10       36,067      5.55       47,617      5.87       33,362     6.01
      Total interest-earning
       assets                          475,921      7.40%     446,980      7.24%     474,467      7.29%     429,893     7.37%
  Noninterest-earning assets            16,284                 16,634                 16,445                 14,463
      Total assets                    $492,205               $463,614               $490,912               $444,356
                                    ===========            ===========           ============           ============

LIABILITIES AND EQUITY:
  Interest-bearing liabilities:
    Savings accounts                  $343,375      4.42%    $307,882      4.37%    $341,976      4.37%    $297,000     4.58%
    Borrowings                          94,522      5.62      107,785      5.61       95,825      5.61      100,102     5.83
      Total interest-bearing
       liabilities                      437,897     4.68%     415,667      4.69%     437,801      4.64%     397,102     4.90%
  Noninterest-bearing liabilities       19,995                 16,426                 19,740                 15,747
  Stockholders' equity                  34,313                 31,521                 33,371                 31,507
      Total liabilities and equity    $492,205               $463,614               $490,912               $444,356
                                    ===========            ===========           ============           ============

  Net interest rate spread                          2.72%                  2.55%                  2.65%                 2.47%
  Net interest margin                               3.10%                  2.88%                  3.01%                 2.85%
  Ratio of interest-earning assets to
   interest-bearing liabilities         108.68%                107.53%                108.38%                108.26%
</TABLE>

         The Company's  average net interest  spread  increased to 2.72% for the
three months  ended March 31, 2000 as compared  2.55% for the three months ended
March 31, 1999.  The increase was due  primarily to the increase in the yield on
interest-earning  assets to 7.40% for the three months ended March 31, 2000 from
7.24%  for  the  three  months  ended  March  31,  1999.  The  overall  cost  of
interest-bearing liabilities was approximately the same, as the average cost for
the three  months ended March 31, 2000 was 4.68% as compared to the average cost
of 4.69% for the same period a year ago.

         The overall  yield on  interest-earning  assets  increased  by 16 basis
points to 7.40% for the three months ended March 31, 2000.  The increase was the
result of  improvements  in all categories of  interest-earning  assets:  loans,
mortgage-backed  securities  and other  investments.  The average yield on loans
receivable increased by 5 basis points to 7.68% for the three months ended March
31, 2000 due to the rising interest rate  environment and to the approximate 50%
increase in non-residential  lending average balances over the current period in
comparison   to  the  same  period  a  year  ago.  The  Company   increased  its
non-residential  lending  activities  during the prior  twelve  months with this
portion of the loan portfolio now  comprising  23% of the total loan  portfolio.
Non-residential  loans have higher yields than single-family loans, although the
Company's primary portfolio product continues to be single-family  lending.  The
average  yield on  mortgage-backed  securities  improved  to 6.66% for the three
months  ended March 31, 2000 as  compared  to 5.97% for the three  months  ended
March 31, 1999 due  primarily to the reduction in the  amortization  of premiums
related to the reduction in prepayment  speeds  resulting  from rising  interest
rates. The average yield on investment securities and other securities increased
to 6.10% for the three  months  ended March 31, 2000 from 5.55% for three months
ended March 31, 1999.  Although  the Company



                                                         10


<PAGE> 13


increased  its  average balance  of  short-term  investments  received  from the
Citibank  deposit acquisition throughout  the Y2K period, the continued increase
in  short-term interest  rates  improved  the  overall  yield  of the investment
portfolio.

         For the  nine  months  ended  March  31,  2000,  the  average  yield on
interest-earning  assets declined to 7.29% from 7.37% for the same period a year
ago. The decline in the overall  yield was  primarily the result of the 12 basis
point decline in the yield on the loan  portfolio  which  decreased to 7.60% for
the nine  months  ended  March 31,  2000.  The  decline in the yield on the loan
portfolio  was  primarily  due to the  existence  of lower rates on the eleventh
district cost of funds index (COFI)  adjustable  rate mortgage loans  throughout
the first six months of this  fiscal  year as compared to the same period a year
ago.  Due to the recent  rise in  interest  rates,  COFI has also begun to trend
upward  which is  expected  to improve  the yield on such loans  which  comprise
approximately  44% of the total  loan  portfolio.  The yield on  mortgage-backed
securities  improved  slightly to 6.52% for the nine months ended March 31, 2000
from 6.21% for the same  period a year ago due  primarily  to a decrease  in the
amortization of premiums resulting from the reduced prepayment speeds. The yield
on investment and other securities was 5.87% for the nine months ended March 31,
2000,  representing  a 14 basis points  decline from the same period a year ago.
This  decline  was  primarily  due to the  maintenance  of  higher  balances  of
short-term  investments  during the current period  following the funds received
from the deposit acquisition.

         The overall cost of interest-bearing  liabilities  declined slightly to
4.68% for the three months ended March 31, 2000 from 4.69% for the same period a
year ago. This decline occurred even though the average cost of savings accounts
and the  average  cost of  borrowings  both  increased  slightly.  This  was due
primarily to a shift in the composition of interest-bearing  liabilities, as the
average  balance of  savings  accounts  as a percent  of total  interest-bearing
liabilities  increased  to 78.4% for the three  months  ended  March 31, 2000 as
compared  to 74.1% for the same  period a year ago.  Since the  average  cost of
savings accounts is substantially lower than the average cost of borrowings, the
overall   result  was  a  decline  in  the  average  cost  of   interest-bearing
liabilities.  The average cost of savings deposits  increased  slightly to 4.42%
for the three  months ended March 31, 2000 from 4.37% for the same period a year
ago due to an increase in the  interest  rate  environment.  The average cost of
borrowings  was  relatively  unchanged at 5.62% for the three months ended March
31, 2000 from 5.61% for the same period a year ago.

         For the nine months ended March 31, 2000, the cost of  interest-bearing
liabilities  decreased to 4.64%, a decline of 26 basis points from 4.90% for the
same period a year ago. The overall  decrease was due to the decline in both the
average cost of savings accounts and of borrowings.  The average cost of savings
accounts  declined by 21 basis  points to 4.37% for the nine months  ended March
31, 2000 from 4.58% for the same  period a year ago.  The decline was due to the
$28.8 million  increase in average core  deposits,  which  generally  have lower
interest  rates, to $130.0 million for the nine months ended March 31, 2000. The
average cost of borrowings  for the nine months ended March 31, 2000 declined by
22 basis points to 5.61% for the nine months ended March 31, 2000, primarily due
to the replacement of matured borrowings with those of lower rates.

Provision for Loan Losses
-------------------------

         The  provision  for loan losses  totaled  $150,000 for the three months
ended March 31, 2000 as compared to $280,000  for the three  months  ended March
31, 1999.  The decline in the  Company's  provision for loan loss charge for the
three  months  ended March 31, 2000 as compared to the three  months ended March
31, 1999 was  partially  due to the  establishment  of a $200,000  reserve for a
single-family  mortgage  loan during the three  months  ended March 31, 1999 not
recurring  in the current  period.  For the nine months ended March 31, 2000 the
provision for loan losses totaled $520,000, as compared to $759,000 for the same
period a year ago. The decline  from a year ago is primarily  due to the decline
in net  charge-offs  to  $350,000  for the nine  months  ended March 31, 2000 as
compared to $452,000 for the same period a year ago and to the  establishment of
the  $200,000  specific  reserve  not  recurring  in  the  current  period.  See
"Financial Condition."



                                        11

<PAGE> 14

Other Income
------------

         Other income increased  slightly to $510,000 for the three months ended
March 31, 2000 from  $470,000 for the three  months  ended March 31,  1999.  The
Company's  fee income on savings  accounts  increased by $53,000 to $196,000 for
the three  months ended March 31, 2000 as compared to the same period a year ago
due to the increase in core  deposits and the deposit  acquisition.  The Company
also posted $58,000 in net gains on sales of investments  available for sale and
for  mark-to-market  adjustments  in the  investments  underlying  the Company's
deferred compensation plans in the three months ended March 31, 2000 as compared
to $28,000 for the comparable period a year ago. Income from secondary marketing
activities was only $3,000 for the three months ended March 31, 2000 as compared
to $28,000 for the same period a year ago due  primarily to the rise in interest
rates resulting in a decline of fixed-rate mortgage  applications.  For the nine
months ended March 31, 2000,  other income increased  approximately  $148,000 to
$1.5  million.  The majority of the increase was due to increased  fee income on
savings  accounts  which  increased  by $161,000 to $592,000 for the nine months
ended  March  31,  2000  from  $431,000  for the  same  period a year  ago.  See
"Financial Condition."

Other Expenses
--------------

         The Company's  other  expenses  increased to $2.8 million for the three
months  ended March 31, 2000 as  compared to $2.2  million for the three  months
ended March 31, 1999. The Company  incurred  approximately  $33,000 in costs for
its pending merger with IndyMac Mortgage Holdings,  Inc. during the three months
ended  March  31,  2000.   Compensation   and  other  employee  costs  increased
approximately $289,000 to $1.6 million for the three months ended March 31, 2000
due to additional employees (in part related to the branch office purchased from
Citibank) and to the increase in stock-related compensation plans as a result of
the  increase  in the  value of the  Company's  common  stock.  All of the other
categories  of other  expenses  reflected  increases  due to the operation of an
additional  branch in the three  months  ended March 31, 2000 as compared to the
same period a year ago. Included in other expenses was approximately  $92,000 in
amortization  of the goodwill  associated with the premiums paid on the deposits
acquired from Citibank and from a prior acquisition.

         For the nine months ended March 31, 2000, the Company's  other expenses
increased  to $8.6 million from $6.6 million for the same period a year ago. The
Company's  costs for the pending  merger with IndyMac  totaled  $420,000 for the
nine  months  ended  March  31,  2000.  Compensation  and other  employee  costs
increased to $4.5  million for the nine months ended March 31, 2000  compared to
$3.8 million for the same period a year ago due primarily to increased costs for
stock-related  compensation plans and additional personnel.  Data processing and
equipment charges increased by approximately  $110,000 in the three months ended
March 31, 2000 to $971,000  due  primarily to the  Citibank  acquisition.  Other
operating  expenses  increased to $1.6  million,  an increase of $477,000 due to
increased  amortization  of  goodwill  related to the deposit  acquisition,  the
initial costs to convert and acquire the deposits from Citibank, and to a lessor
extent on Y2K-related issues.

Income Taxes
------------

         The Company's  income taxes  increased to $516,000 for the three months
ended March 31, 2000  compared to $471,000 in income  taxes for the three months
ended March 31, 1999. The increase in taxes was primarily due to the improvement
in pre-tax  earnings  and to the  expected  non-deductibility  of the $33,000 in
costs incurred regarding the pending merger with IndyMac Mortgage Holdings, Inc.
As a result of these  non-deductible  expenses,  the  effective tax rate for the
three  months  ended March 31, 2000  increased to 41.2% from 40.2% for the three
months  ended March 31, 1999.  For the nine months  ended March 31, 2000,  total
taxes were $1,420,000,  as compared to $1,304,000 in total taxes accrued for the
same period a year ago. In regards to the nine months ended March 31, 2000,  the
increase  in  taxes  was  primarily  due to the  expected  non-deductibility  of
$420,000 in costs  incurred  regarding  the pending  merger with  IndyMac.  As a
result,  the  effective  tax rate for the  nine  months  ended  March  31,  2000
increased to 45.6% from 40.8% for the same period a year ago.


                                       12



<PAGE> 15

FINANCIAL CONDITION
-------------------

         The  Company's  total assets  increased to $496.6  million at March 31,
2000 from $468.7 million in total assets at June 30, 1999.  The Company's  loans
receivable  held for investment  increased by $16.7 million to $371.7 million at
March 31, 2000  compared to $355.0  million at June 30, 1999.  The growth in the
loan  portfolio  was aided by the  purchase of $17.0  million in mortgage  loans
during the nine months  ended March 31,  2000.  The Company was able to increase
its loan  portfolio even though its total volume of  originations  and purchases
declined by more than 55% in the nine months ended March 31, 2000 as compared to
the same  period a year ago as the rise in  interest  rates also  resulted  in a
similar decline in the level of prepayments. Total principal repayments on loans
received  during the nine months ended March 31, 2000 were only $36.3 million as
compared to $71.7 million for the same period a year ago.

         During the nine months ended March 31, 2000, the Company originated and
purchased for  investment a total of $55.0 million in mortgage loans as compared
to the $129.3  million  purchased and  originated in the nine month period ended
March 31, 1999. The significant reduction in overall lending activity was due to
the  increase in interest  rates  resulting  in a  substantial  fall-off in loan
prepayments  and  therefore  less of a need to  purchase or  originate  loans as
replacements. Also, in regards to the loans funded for portfolio during the nine
months ended March 31, 2000,  approximately  95% were  adjustable  rate mortgage
loans as fixed-rate loan rates rose  significantly  during the nine months ended
March 31, 2000 which curtailed interest in this type of loan. As a result of the
increase in interest  rates,  the Company only  originated $5.3 million in loans
held for sale and sold  approximately  $4.3  million  in  mortgage  loans to the
secondary market or to other financial institutions during the nine months ended
March 31, 2000. The total mortgage-backed securities portfolio declined to $60.2
million at March 31, 2000 from $62.6  million at June 30,  1999,  primarily as a
result  of the $7.5  million  in  principal  reduction  partially  offset by the
purchase  of  approximately  $5.5  million  in  adjustable-rate  mortgage-backed
securities during the nine months ended March 31, 2000. The Company's balance of
investment  securities  available  for sale  increased by $11.1 million to $36.9
million  at  March  31,  2000  as  the  Company   maintained  higher  short-term
investments  throughout the Y2K process and in  consideration  of higher current
interest  rates.  The Company's  other assets  increased  during the nine months
ended  March 31,  2000  primarily  due to the $1.3  million in deposit  premiums
related to the Citibank acquisition.

         The Company's  non-performing  assets totaled $2.2 million at March 31,
2000  compared  to $2.4  million  at June  30,  1999.  The  slight  decrease  in
non-performing  assets was  related  to  decreases  in both the  balance of real
estate acquired in settlement of loans which totaled  $738,000 at March 31, 2000
as compared to $827,000 at June 30, 1999 and the balance of non-performing loans
which  totaled  $1.4 million  versus $1.5 million at June 30, 1999.  This change
reduced the Company's ratio of non-performing assets to total assets to 0.44% at
March 31, 2000 from 0.50% at June 30, 1999.

         The following table sets forth the  non-performing  assets at March 31,
2000 and June 30, 1999:
<TABLE>
<CAPTION>

                                                              March 31, 2000                  June 30, 1999
                                                                           (Dollars in thousands)
<S>                                                                 <C>                            <C>
Non-accrual loans                                                   $1,448                         $1,524
Real estate acquired through foreclosure                               738                            827
      Non-performing assets                                         $2,186                         $2,351
                                                              =============                  =============

Non-performing assets as a percent
  of total assets                                                     0.44%                          0.50%
Non-performing loans as a percent
  of gross loans receivable                                           0.39%                          0.43%

</TABLE>

         The Company  considers  a loan  impaired  when it is probable  that the
Company  will be  unable to  collect  all  contractual  principal  and  interest
payments  under  the  terms of the  loan  agreement.  Loans  are  evaluated  for



                                                            13

<PAGE> 16


impairment as part of the Company's  normal internal asset review  process.  The
Company applies the  measurement  provisions of SFAS No. 114, as amended by SFAS
No. 118, to all loans in its portfolio with the exception of one- to four-family
residential mortgage loans and consumer lines of credit which are evaluated on a
collective  basis for impairment.  Also,  loans which have delays in payments of
less than four  months are not  necessarily  considered  impaired  unless  other
factors apply to the loans.  The accrual of interest income on impaired loans is
discontinued when, in management's  opinion,  the borrower may be unable to meet
payments as they become due.  When the  interest  accrual is  discontinued,  all
unpaid accrued interest is reversed.  Interest income is subsequently recognized
only to the extent cash  payments are received.  Where  impairment is considered
temporary,  an allowance is  established.  Impaired  loans which are  performing
under the contractual  terms are reported as performing loans, and cash payments
are  allocated to principal  and  interest in  accordance  with the terms of the
loan. For those loans which are reviewed  individually for impairment,  at March
31, 2000, the Company had  classified  two loans  totaling  $346,000 as impaired
with no specific  reserves and had no such loans  classified as impaired at June
30, 1999 with no specific  reserves as determined  in  accordance  with SFAS No.
114, as amended by SFAS No. 118. In  addition,  the Company had $1.1 million and
$1.5  million at March 31,  2000 and June 30,  1999,  respectively,  in impaired
loans,  which were  collectively  evaluated  for  impairment  with  $38,000  and
$238,000  in  reserves  set  aside as of  March  31,  2000  and  June 30,  1999,
respectively.  The average recorded  investment in impaired loans,  inclusive of
those evaluated  collectively,  during the nine months ended March 31, 2000, was
$1.6 million, whereas, the average for the twelve months ended June 30, 1999 was
$1.9 million.

         The Company,  in consideration of the current economic  environment and
the condition of the loan portfolio, maintained the allowance for loan losses at
March 31, 2000 at $2.0 million.  The loans on non-accrual  status have decreased
slightly to $1.4  million at March 31, 2000 from $1.5  million at June 30, 1999.
The allowance for loan losses is  maintained at an amount  management  considers
adequate to cover estimated losses in loans receivable which are deemed probable
and  estimable.  The  allowance  is based  upon a number of  factors,  including
current economic  conditions,  actual loss experience and industry  trends.  The
Company's  non-performing  loans are  primarily  made up of one- to  four-family
residential mortgage loans.

         The following table sets forth the activity in the Company's  allowance
for loan losses for the nine months ended March 31, 2000:
<TABLE>
<CAPTION>

                                                                              Activity for the Nine Months Ended
                                                                                        March 31, 2000
                                                                                    (Dollars in thousands)

<S>                                                                                               <C>
Balance at June 30, 1999                                                                          $1,845
Add:
    Provision for loan losses                                                                        520
    Recoveries of previous charge-offs                                                                 9
Less:
    Charge-off of consumer loans                                                                     144
    Charge-off of real estate loans                                                                  206
Balance at March 31, 2000                                                                         $2,024
                                                                                     ====================

</TABLE>

         The Company's  total  liabilities  increased to $461.7 million at March
31, 2000 from $436.4 million at June 30, 1999. Total deposit accounts  increased
$40.4  million to $364.5  million at March 31, 2000 from $324.1  million at June
30, 1999,  primarily as a result of the  acquisition  of deposit  accounts  from
Citibank in July 1999.  The Company  decreased its  borrowings  from the FHLB by
$14.1 million during the three months ended March 31, 2000 as the Company used a
portion of the cash received from the  acquisition  of the Citibank  deposits to
allow maturing short-term FHLB borrowings to roll off. Also, an additional $14.0
million in FHLB borrowings which matured during the nine months ending March 31,
2000 were  renewed  into  five-year  terms to assist in the  lengthening  of the
average  life  of  the  Company's   liabilities  and  lessen  its  interest-rate
sensitivity.  The Company continues to utilize


                                                  14


<PAGE> 17


FHLB advances and securities sold under agreements to repurchase  as part of its
asset and liability  management strategy.

         The Company's  stockholders' equity increased to $34.9 million at March
31, 2000 from $32.4  million at June 30, 1999  primarily  as a result of the net
earnings  for the nine  months  ending  March 31,  2000 and to the  exercise  of
approximately 45,000 in vested options in December 1999. The common stock issued
on behalf of the exercised options was from the Company's treasury stock.

LIQUIDITY
---------

         The  Company's  primary  sources of funds are  deposits,  principal and
interest  payments  on loans  and  mortgage-backed  securities,  FHLB  advances,
securities sold under agreements to repurchase,  increases in deposits and, to a
lesser extent, proceeds from the sale of loans and investments. While maturities
and scheduled  amortization of loans are predictable  sources of funds,  deposit
flows and mortgage prepayments are greatly influenced by general interest rates,
economic conditions and competition.

         The Association, by regulation, must maintain its liquidity ratio at no
less than 4.0% of deposits and short-term borrowings.  Liquidity represents cash
and the majority of the Company's investments which are not committed or pledged
to specific liabilities. The Association's average liquidity ratio for March 31,
2000 and March 31, 1999 was 19.12% and 16.42%, respectively.










                                   15


<PAGE> 18


COMMITMENTS AND CONTINGENT LIABILITIES
--------------------------------------

         At March 31,  2000,  there were no  material  changes to the  Company's
commitments  or  contingent  liabilities  from the period ended June 30, 1999 as
discussed  in the  Company's  notes  to the  consolidated  financial  statements
reflected in the audited consolidated financial statements of SGV Bancorp, Inc.,
for the year ended June 30, 1999  included in the Annual Report on Form 10-K for
the year ended June 30,  1999.  At March 31, 2000,  the Company had  outstanding
commitments to originate or purchase mortgage loans of $1.8 million, as compared
to $4.8 million at June 30, 1999.

REGULATORY CAPITAL
------------------

         The Office of Thrift  Supervision  (OTS)  capital  regulations  require
savings institutions to meet three minimum capital requirements: a 1.5% tangible
capital ratio,  a 3% leverage (core capital) ratio and an 8% risk-based  capital
ratio. The core capital requirement has been effectively increased to 4% because
the prompt  corrective action  legislation  provides that institutions with less
than 4% core capital will be deemed  "undercapitalized".  In addition,  the OTS,
under the prompt corrective action regulation can impose various  constraints on
institutions   depending   on  their  level  of   capitalization   ranging  from
well-capitalized  to  critically  undercapitalized.   At  March  31,  2000,  the
Association was considered "well-capitalized".

         The  Association  was in compliance  with the capital  requirements  in
effect as of March 31, 2000. The following  table  reflects the required  ratios
and the actual capital ratios of the Association at March 31, 2000:
<TABLE>
<CAPTION>

                                                                                                   CAPITAL
                                     ACTUAL          REQUIRED            EXCESS           ACTUAL            REQUIRED
                                    CAPITAL           CAPITAL            AMOUNT           PERCENT            PERCENT
                                                                (Dollars in thousands)
         <S>                        <C>                <C>              <C>                 <C>               <C>
         Tangible                   $ 32,648           $ 7,444          $ 25,204            6.58%             1.50%

         Core                       $ 32,648          $ 19,852          $ 12,796            6.58%             4.00%

         Risk-based                 $ 34,634          $ 21,250          $ 13,384           13.04%             8.00%
</TABLE>


PRIVATE SECURITIES LITIGATION REFORM ACT SAFE HARBOR STATEMENT
--------------------------------------------------------------

         In  addition  to  historical  information,  this Form 10-Q may  include
forward-looking  statements  based  on  current  management  expectations.   The
Company's actual results could differ materially from management's expectations.
Factors  that  could  cause  future  results  to vary  from  current  management
expectations  include,  but are not limited  to,  general  economic  conditions,
legislative and regulatory changes,  monetary and fiscal policies of the federal
government, changes in tax policies, rates and regulations of federal, state and
local tax  authorities,  changes in interest rates,  deposit flows,  the cost of
funds,  demand for loan products,  demand for financial  services,  competition,
changes in the  quality or  composition  of the  Company's  loan and  investment
portfolios, changes in accounting principles,  policies or guidelines, and other
economic,  competitive,  governmental and  technological  factors  affecting the
Company's  operations,   markets,   products,   services  and  prices.   Further
description  of the risks and  uncertainties  to the business of the Company are
included in detail in the Company's Form 10-K for the fiscal year ended June 30,
1999.

YEAR 2000
---------

         As of April 28, 2000,  the Company has  experienced  no  disruptions or
problems regarding the year 2000 changeover.  As part of the Company's Y2K plan,
on January 1, 2000, the Company tested and sampled  internal

                                         16


<PAGE> 19


systems  including its primary  third-party  data  processor,  telecommunication
systems,  automated teller machines and related  third-party  vendors supporting
these machines,  various  third-party  software  applications  and the Company's
ability to interface with its  correspondent  banks such as the Federal  Reserve
Bank of San  Francisco.  All sampling  and testing  completed on January 1, 2000
indicated all systems were  operating as normal.  Through April 28, 2000, all of
the Company's  internal  hardware and software continue to operate as normal and
to-date, and to the Company's knowledge,  all vendors utilized by the Company in
its daily  operations  are  operating  normally and have not  indicated  any Y2K
anomalies.

         As of April 28, 2000,  there has been no indication of any misstatement
or  misrepresentation  of any deposit or loan customer  financial position based
upon the  records of the  Company.  Also,  from the  deposit  or loan  customers
perspective,  no  customers  have  advised the Company  that they are having any
Y2K-related issues which would present any financial exposure to the Company.

         The Company  continued to monitor and oversee all  internal  operations
and was in contact with its vendors  regarding the additional Y2K dates (such as
February  29,  2000 and March 1,  2000)  which  were  identified  as  presenting
potential Y2K issues.  The Company did not  experience  any problems  throughout
these  additional  dates.  The Company  will  continue  to monitor its  internal
operations and vendors into the future, but based upon the continued  successful
operations to date, does not anticipate any problems to arise.

         The Company's  expenditures  for the Y2K effort  totaled  approximately
$222,000,  which is below the expected  total of $260,000  (these costs  exclude
approximately   $700,000  in  hardware  and  software   purchased  in  1997).  A
significant  portion of the estimated  costs incurred for the Y2K effort was the
use of internal  staff  resources  which  totaled  approximately  $168,000.  The
Company did not incur any material  costs during the  preceding  three months in
regards to Y2K.

RECENT LEGISLATION
------------------

         Recent  legislation   designed  to  modernize  the  regulation  of  the
financial  services  industry  expands the ability of bank holding  companies to
affiliate  with other types of financial  services  companies  such as insurance
companies and investment banking companies.  However,  the legislation  provides
that companies that acquire control of a single savings association after May 4,
1999 (or that filed an  application  for that  purpose  after that date) are not
entitled to the unrestricted  activities  formerly allowed for a unitary savings
and loan holding company.  Rather, these companies will have authority to engage
in the  activities  permitted  "a  financial  holding  company"  under  the  new
legislation,  including  insurance and  securities-related  activities,  and the
activities  currently permitted for multiple savings and loan holding companies,
but  generally  not in commercial  activities.  The  authority for  unrestricted
activities is grandfathered for unitary savings and loan holding companies, such
as the Company,  that existed prior to May 4, 1999.  However,  the authority for
unrestricted  activities  would  not  apply to any  company  that  acquired  the
Company.  Accordingly, it is likely that after the consummation of the Company's
acquisition by IndyMac Mortgage Holdings,  Inc., IndyMac will not be entitled to
engage  in the  unrestricted  activities  in  which  the  Company  is  currently
authorized to engage.


Item 3.  Quantitative and Qualitative Disclosure about Market Risk
         ---------------------------------------------------------

MANAGEMENT OF INTEREST RATE RISK
--------------------------------

         The Company's profitability is dependent to a large extent upon its net
interest  income,  which  is the  difference  between  its  interest  income  on
interest-earning assets, such as loans and investments, and its interest expense
on interest-bearing  liabilities, such as deposits and borrowings. To manage its
interest  rate risk,  the Company has utilized  the  following  strategies:  (i)
emphasizing  the  origination  and/or  purchase  of   adjustable-rate   one-  to
four-family  mortgage loans for portfolio;  (ii) selling to the secondary market
the majority of the fixed-rate  mortgage loans originated;  and (iii) attempting
to reduce the overall  interest rate  sensitivity  of liabilities by emphasizing
core and longer-term deposits, utilizing FHLB advances and securities sold under
agreements to repurchase.


                                     17

<PAGE> 20


         The Association's  interest rate sensitivity is monitored by management
through the use of an internally  generated  model which estimates the change in
net portfolio value ("NPV") over a range of interest rate scenarios.  NPV is the
present value of expected cash flows from assets,  liabilities  and  off-balance
sheet contracts.  An NPV Ratio, in any interest rate scenario, is defined as the
NPV in that scenario divided by the market value of assets in the same scenario.
The Sensitivity Measure is the decline in the NPV Ratio, in basis points, caused
by a 2% increase or decrease in rates,  whichever produces a larger decline. The
higher an  institution's  Sensitivity  Measure is, the  greater its  exposure to
interest rate risk is considered to be. The OTS also produces a similar analysis
using its own model,  based upon data submitted on the  Association's  quarterly
Thrift Financial Reports.

         As of  March  31,  2000,  the  Association's  Sensitivity  Measure,  as
measured by the Association,  was 1.41%. The Sensitivity  Measure as measured by
the OTS,  will not be  available  until  near the end of the  second  quarter of
calendar 2000.  Historically,  the differences  between the two measurements are
partially attributed to differences in assigning various prepayment rates, decay
rates and discount rates. The Association compares the results from the OTS with
its  internally  generated  results  and  provides  the  Board  of  Directors  a
comparison to determine if there is any additional risk.

         In addition to monitoring  selected  measures of NPV,  management  also
monitors  effects on net  interest  income  resulting  from  changes in interest
rates.  These  measures  are used in  conjunction  with NPV measures to identify
potential  interest rate risk. The Association  projects net interest income for
the next 12-month period, based upon certain specific assumptions. For the years
ended June 30, 1999,  1998 and 1997, the  forecasted net interest  income in the
existing rate environment  (held constant for the period) for interest rate risk
management  purposes  was  $11.5  million,  $10.2  million,  and  $8.1  million,
respectively,  compared  to the actual net  interest  income  recorded  of $12.4
million, $10.9 million, and $9.6 million, respectively.

         Certain  shortcomings are inherent in the methodology used in the above
interest rate risk measurements.  Modeling changes in NPV requires the making of
certain  assumptions  which may tend to oversimplify  the manner in which actual
yields and costs respond to changes in market interest rates.  First, the models
assume that the composition of the Association's  interest  sensitive assets and
liabilities  existing at the  beginning of a period  remains  constant  over the
period being  measured.  Second,  the models assume that a particular  change in
interest  rates is  reflected  uniformly  across the yield curve  regardless  of
duration to maturity or repricing of specific assets and liabilities. Third, the
model does not take into account the Association's  business or strategic plans.
Accordingly, although the NPV measurements and interest income models do provide
an indication of the  Association's  interest rate risk exposure at a particular
point in time,  such  measurements  are not  intended  to and do not  provide  a
precise  forecast  of the  effect of  changes  in market  interest  rates on the
Association's net interest income and will differ from actual results.













                                         18

<PAGE> 21


         The following table sets forth, at March 31, 2000 and June 30, 1999, an
analysis of the Association's internal report of its interest rate risk measured
by the estimated  changes in the NPV resulting from  instantaneous and sustained
parallel  shifts in the yield curve (+/-300 basis points,  measured in 100 basis
point increments).
<TABLE>
<CAPTION>


                CHANGE IN                                   NET PORTFOLIO VALUE - MARCH 31, 2000
                                                  ----------------------------------------------------------
             INTEREST RATES                                                                 NPV AS A % OF
             In Basis Points                                              Change            Present Value
              (Rate Shock)                            Amount                 $                  Assets
          ----------------------                  ----------------    ----------------     -----------------
                                                                   (Dollars in thousands)

                   <S>                                    <C>               <C>                       <C>
                   300                                    $28,841           $(13,247)                 5.99%
                   200                                     34,068             (8,020)                 6.96%
                   100                                     38,794             (3,294)                 7.81%
                   --                                      42,088                   -                 8.37%
                  (100)                                    44,530               2,442                 8.76%
                  (200)                                    43,252               1,164                 8.49%
                  (300)                                    41,685               (403)                 8.16%

</TABLE>
<TABLE>
<CAPTION>

                CHANGE IN                                    NET PORTFOLIO VALUE - JUNE 30, 1999
                                                  ----------------------------------------------------------
             INTEREST RATES                                                                 NPV AS A % OF
             In Basis Points                                              Change            Present Value
              (Rate Shock)                            Amount                 $                  Assets
          ----------------------                  ----------------    ----------------     -----------------
                                                                   (Dollars in thousands)

                   <S>                                    <C>               <C>                       <C>
                   300                                    $26,429           $(14,378)                 5.68%
                   200                                     32,065             (8,742)                 6.79%
                   100                                     36,939             (3,868)                 7.71%
                   --                                      40,807                   -                 8.41%
                  (100)                                    39,691             (1,115)                 8.28%
                  (200)                                    39,976               (831)                 8.29%
                  (300)                                    41,642                 836                 8.55%
</TABLE>

         At March 31,  2000,  the  Association  was slightly  less  sensitive to
rising interest rates than was evident at June 30, 1999. Although there has been
an increase in the overall  interest rate  environment  from June 30, 1999,  the
increased  sensitivity  resulting  from these  higher  interest  rates have been
offset  by  the  increase  in  core  deposits,  primarily  due  to  the  deposit
acquisition,  the replacement of $14 million in short-term borrowings with those
of longer terms and the increase in adjustable  rate  mortgages  during the past
nine months.  In comparing the  Association's  NPV as a percent of present value
assets in the current  interest rate environment for March 31, 2000 and June 30,
1999, the ratios reflect a very slight decline to 8.37% from 8.41%. The declines
in the Association's  NPVs in rising rates is primarily due to the interest rate
sensitivity of fixed-rate  mortgage loans and  mortgage-backed  securities which
comprise  approximately  27% of the total assets of the  Association as of March
31, 2000, although this represents a decline from the 30% ratio existing at June
30, 1999.

         In regards to the  application  of the above  analysis  on the  pending
merger with IndyMac, the figures presented above are only intended to provide an
indication of relative interest rate sensitivity of the Association at March 31,
2000 and June 30, 1999. As defined in the original  merger  agreement dated July
12, 1999 and the amended and restated merger agreement,  dated October 25, 1999,
there are several  adjustments  which must be considered  before  arriving at an
overall  NPV  which  can be used  as  outlined  in the  merger  agreement.  Such
adjustments  include,  but are not  limited  to,  the  additional  equity of the
holding  company  (adjusted for  intercompany  eliminations),  exercise of stock
options, expenses incurred in connection with the pending merger and a review of
the assumptions used in developing the NPV analysis.


                                      19

<PAGE> 22

         Although  the  Company  does  provide  IndyMac  with an analysis of the
Association's  NPV on a periodic  basis  (including the NPV analysis as of March
31, 2000) and provides a summary of the adjustments for items as outlined in the
merger  agreement,  IndyMac has twenty business days to review this adjusted NPV
and  question  or comment on the  analysis.  For further  information  on NPV in
context with the pending merger,  please refer to the merger agreements as noted
above.

PART II. OTHER INFORMATION


Item 1.           Legal Proceedings
                  -----------------

         The Company is involved as  plaintiff  or  defendant  in various  legal
actions incident to its business,  none of which is believed by management to be
material to the financial condition of the Company.

Item 2.           Changes in Securities
                  ---------------------
                           None.

Item 3.           Defaults in Securities
                  ----------------------
                           None.

Item 4.           Submission of Matters to a Vote of Security Holders
                  ---------------------------------------------------
                           None.

Item 5.           Other Information
                  -----------------
                           None.

Item 6.           Exhibits and Reports on Form 8-K
                  --------------------------------

         (a)   The following exhibits are filed as part of this report:

         2.1   Agreement and Plan of Merger By and Between SGV Bancorp,  Inc.
               and IndyMac Mortgage Holdings, Inc., Dated as of July 12, 1999**
         2.2   Amended  and  Restated  Plan  of  Merger  By and  Between  SGV
               Bancorp, Inc. and IndyMac Mortgage Holdings, Inc., Dated as of
               July 12, 1999 and Amended and  Restated as of October 25, 1999***
         3.1   Certificate of Incorporation of SGV Bancorp, Inc. *
         3.2   Bylaws of SGV Bancorp, Inc. *
        27.0   Financial data schedule (filed herewith).
         (b)   Reports on Form 8-K
                    none.

-------------------
*        Incorporated  herein by reference from the Exhibits to the Registration
         Statement on Form S-1, as amended,  filed on March 6, 1995 and declared
         effective on May 9, 1995, Registration No. 33-90018.
**       Incorporated  by reference from the Form 8-K (File No. 000-25664) filed
         with the SEC on July 14, 1999.
***      Incorporated  herein by reference from the appendices to the definitive
         merger proxy statement filed on November 5, 1999.












                                        21

<PAGE> 23



                                                    SIGNATURES


         Pursuant to the  requirements  of the  Securities  and  Exchange Act of
1934,  the  Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.


                                        SGV BANCORP, INC.




May 9, 2000                             /s/ Barrett G. Andersen
----------------------------            ----------------------------------------
Date                                    Barrett G. Andersen
                                        President and Chief Executive Officer



May 9, 2000                             /s/ Ronald A. Ott
----------------------------            ----------------------------------------
Date                                    Ronald A. Ott
                                        Executive Vice President
                                        Chief Financial Officer and Treasurer












                                       22