SECURITY AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB



(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: 0-26650

                            CSB FINANCIAL GROUP, INC.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)


            United States                                    37-1336338
---------------------------------                    ---------------------------
  (State or other jurisdiction                       (I.R.S. Employer ID Number)
of incorporation or organization)

  200 South Poplar, Centralia, Illinois                        62801
----------------------------------------                     ----------
(Address of principal executive offices)                     (Zip code)


        Registrant's telephone number, including area code (618) 532-1918


Indicate by check mark whether the registrant (1) has filed all reports required
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.   YES [ X ]    NO [  ]

Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.

            Class                              Shares outstanding at May 1, 2000
-----------------------------                  ---------------------------------
Common Stock, Par Value $0.01                                732,299
<PAGE>


Contents

PART I.  FINANCIAL INFORMATION

Item I.  Financial Statements

         - Consolidated Balance Sheets

         - Consolidated Statements of Income and Comprehensive Income

         - Consolidated Statements of Cash Flows

         - Notes to Consolidated Financial Statements

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

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

Item 2.  Changes in Securities

Item 3.  Defaults Upon Senior Securities

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

Item 5.  Other Information

Item 6.  Exhibits and Reports on Form 8-K

SIGNATURES





<PAGE>


CSB FINANCIAL GROUP, INC. and SUBSIDIARY

Consolidated Balance Sheets
March 31, 2000 and September 30, 1999
(in thousands, except share data)
(Unaudited)

                                               March 31, September 30,
ASSETS                                           2000        1999
----------------------------------------------------------------------

Cash and cash equivalents ................    $  1,444      $   871
Securities:
   Available for sale ....................      15,798       17,118
   Nonmarketable equity securities .......         216          216
Loans ....................................      30,110       29,142
Allowance for loan losses ................        (220)        (222)
                                              ---------------------
              Loans, net .................      29,890       28,920
Premises and equipment ...................         659          683
Accrued interest receivable ..............         336          318
Intangible assets ........................         509          539
Other assets .............................         208          255
                                              ---------------------

              Total assets ...............    $ 49,060     $ 48,920
                                              =====================

<PAGE>


CSB FINANCIAL GROUP, INC. and SUBSIDIARY

Consolidated Balance Sheets
March 31, 2000 and September 30, 1999
(in thousands, except share data)
(Unaudited)
<TABLE>

                                                                  March 31, September 30,
LIABILITIES AND STOCKHOLDERS'  EQUITY                               2000       1999
-----------------------------------------------------------------------------------------
<S>                                                               <C>       <C>
LIABILITIES:
   Deposits:
      Demand ...................................................  $  8,946   $  8,563
      Savings ..................................................     3,553      3,794
      Time deposits > $100,000 .................................     3,090      2,627
      Other time deposits ......................................    22,992     21,922
                                                                  -------------------
              Total deposits ...................................    38,581     36,906
                                                                  -------------------
   Advances from the Federal Home Loan Bank ....................       - -      1,400
   Other liabilities ...........................................       163        191
   Deferred income taxes .......................................        23        145
                                                                  -------------------
              Total liabilities ................................    38,767     38,642
                                                                  -------------------

COMMITMENTS, CONTINGENCIES AND CREDIT RISK

STOCKHOLDERS' EQUITY
   Preferred stock, $0.01 par value; 100,000 shares authorized;
      none issued ..............................................       - -        - -
   Common stock, $0.01 par value; authorized 2,000,000 shares;
      1,035,000 shares issued ..................................        10         10
   Paid-in capital .............................................     7,834      7,829
   Retained earnings ...........................................     6,822      6,683
   Accumulated other comprehensive income (loss) ...............      (210)       (53)
   Unearned employee stock ownership plan shares ...............      (150)      (160)
   Management recognition plan .................................      (496)      (514)
                                                                  -------------------
                                                                    13,810     13,795
   Less cost of treasury stock; 302,701 shares at March 31, 2000
      and September 30, 1999 ...................................    (3,517)    (3,517)
                                                                  -------------------
              Total stockholders' equity .......................    10,293     10,278
                                                                  -------------------

              Total liabilities and stockholders' equity .......  $ 49,060   $ 48,920
                                                                  ===================
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>


CSB Financial Group, Inc.
Consolidated Statements of Income
Six Months Ended March 31, 2000 and 1999
(Unaudited, in thousands, except per share data)

<TABLE>
                                                                           Six
                                                                       Months Ended
                                                                         March 31,
                                                                     ----------------
                                                                      2000      1999
                                                                     ----------------
<S>                                                                  <C>       <C>
Interest income:
   Loans and fees on loans ......................................    $1,153    $1,094
   Securities ...................................................       539       528
                                                                     ----------------
              Total interest income .............................     1,692     1,622
                                                                     ----------------

Interest expense:
   Deposits .....................................................       782       797
   Borrowings ...................................................        36       - -
                                                                     ----------------
              Total interest expense ............................       818       797
                                                                     ----------------

              Net interest income ...............................       874       825
Provision for loan losses .......................................        17        36
                                                                     ----------------

              Net interest income after provision for loan losses       857       789
                                                                     ----------------
Noninterest income:
   Service charges on deposits ..................................        50        39
   Gain on sale of securities, net ..............................         1       - -
   Other ........................................................        17        25
                                                                     ----------------
              Total noninterest income ..........................        68        64
                                                                     ----------------

Noninterest expense:
   Compensation and employee benefits ...........................       336       326
   Occupancy and equipment ......................................        52        47
   Data processing ..............................................        84        73
   Audit, legal and other professional ..........................       122        46
   Other ........................................................       171       178
                                                                     ----------------
              Total noninterest expense .........................       765       670
                                                                     ----------------
              Income before income taxes ........................       160       183
Income taxes ....................................................        21        54
                                                                     ----------------
              Net income ........................................    $  139    $  129
                                                                     ================

Earnings per share
   Basic ........................................................    $ 0.19    $ 0.18
                                                                     ================

   Diluted ......................................................    $ 0.19    $ 0.18
                                                                     ================

Weighted average shares outstanding
   Basic ........................................................   722,941   717,178
                                                                    =================

   Diluted ......................................................   747,187   728,356
                                                                    =================
</TABLE>
See Notes to Consolidated Financial Statements.

<PAGE>


CSB Financial Group, Inc.
Consolidated Statements of comprehensive income
Six Months Ended March 31, 2000 and 1999
(Unaudited, in thousands, except per share data)


                                                                     Six
                                                                Months Ended
                                                                   March 31,
                                                              -----------------
                                                                2000      1999
                                                              -----------------

Net income ................................................   $   139   $   129

Change in unrealized gain on securities available for sale,
   net of tax of $(97) and $(31) ..........................      (157)      (51)
                                                              -----------------

Comprehensive income ......................................   $   (18)  $    78
                                                              =================

See Notes to Consolidated Financial Statements.
<PAGE>


CSB Financial Group, Inc.
Consolidated Statements of Income
Three Months Ended March 31, 2000 and 1999
(Unaudited, in thousands, except per share data)

<TABLE>
                                                                        Three
                                                                     Months Ended
                                                                       March 31,
                                                                   ------------------
                                                                     2000      1999
                                                                   ------------------
<S>                                                                <C>       <C>

Interest income:
   Loans and fees on loans ......................................  $    582  $    564
   Securities ...................................................       266       254
                                                                   ------------------
              Total interest income .............................       848       818
                                                                   ------------------

Interest expense:
   Deposits .....................................................       392       392
   Borrowings ...................................................        20       - -
                                                                   ------------------
              Total interest expense ............................       412       392
                                                                   ------------------

              Net interest income ...............................       436       426
Provision for loan losses .......................................         3        18
                                                                   ------------------

              Net interest income after provision for loan losses       433       408
                                                                   ------------------

Noninterest income:
   Service charges on deposits ..................................        24        19
   Gain on sale of securities, net ..............................         1       - -
   Other ........................................................         9        10
                                                                   ------------------
              Total noninterest income ..........................        34        29
                                                                   ------------------

Noninterest expense:
   Compensation and employee benefits ...........................       167       157
   Occupancy and equipment ......................................        31        23
   Data processing ..............................................        32        48
   Audit, legal and other professional ..........................        78        15
   Other ........................................................        72        82
                                                                   ------------------
              Total noninterest expense .........................       380       325
                                                                   ------------------
              Income before income taxes ........................        87       112
Income taxes ....................................................        32        31
                                                                   ------------------
              Net income ........................................  $     55  $     81
                                                                   ==================

Earnings per share
   Basic ........................................................  $   0.08  $    0.11
                                                                   ===================
   Diluted ......................................................  $   0.07  $    0.11
                                                                   ===================

Weighted average shares outstanding
   Basic ........................................................   723,249    717,349
                                                                   ===================
   Diluted ......................................................   751,273    728,527
                                                                   ===================
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>


CSB Financial Group, Inc.
Consolidated Statements of comprehensive income
Three Months Ended March 31, 2000 and 1999
(Unaudited, in thousands, except per share data)


                                                                     Three
                                                                 Months Ended
                                                                   March 31,
                                                               -----------------
                                                                2000      1999
                                                               -----------------

Net income .................................................   $   55    $   81

Change in unrealized gain on securities available for sale,
   net of tax of $(59) and $(30) ...........................          (97)  (49)
                                                               ----------------

Comprehensive income .......................................   $  (42)   $   32
                                                               ================


See Notes to Consolidated Financial Statements.

<PAGE>


CSB Financial Group, Inc.
Consolidated Statements of CASH FLOWS
Six Months Ended March 31, 2000 and 1999
(Unaudited, in thousands)

<TABLE>
                                                                                   Six
                                                                               Months Ended
                                                                                 March 31,
                                                                           ------------------
                                                                             2000      1999
                                                                           ------------------
<S>                                                                        <C>        <C>
Cash Flows from Operating Activities:
   Net income ..........................................................   $   139    $   129
   Adjustments to reconcile net income to net cash provided
      by operating activities:
      Provision for loan losses ........................................        17         36
      Provision for depreciation .......................................        35         21
      Deferred income taxes ............................................       (25)        (4)
      Amortization of intangible assets ................................        30         31
      Employee stock ownership plan compensation expense ...............        15         13
      Management recognition plan compensation expense .................        18         18
      Gain on sale of securities .......................................        (1)       - -
      Amortization and accretion on securities .........................         1          6
      Change in assets and liabilities:
        (Increase) in accrued interest receivable ......................       (18)        (2)
        Decrease in other assets .......................................        47         50
        (Decrease) in other liabilities ................................       (28)       (28)
                                                                           ------------------
              Net cash provided by operating activities ................       230        270
                                                                           ------------------

Cash Flows from Investing Activities:
   Securities available for sale:
      Purchases ........................................................    (1,783)    (3,453)
      Proceeds from sales ..............................................     1,794        - -
      Proceeds from maturities and paydowns ............................     1,055      4,741
   Proceeds from sales of nonmarketable equity securities ..............       - -          4
   (Increase) in loans .................................................      (987)    (2,478)
   Purchase of premises and equipment ..................................       (11)        (8)
                                                                           ------------------
              Net cash provided by (used in) investing activities ......        68     (1,194)
                                                                           ------------------

Cash Flows from Financing Activities:
   Increase in deposits ................................................   $ 1,675   $  1,323
   Repayment of FHLB advances ..........................................    (1,400)       - -
   Purchase of treasury stock ..........................................       - -         (5)
                                                                           ------------------
              Net cash provided by financing activities ................       275      1,318
                                                                           ------------------
              Increase in cash and cash equivalents ....................       573        394

Cash and cash equivalents at beginning of period .......................       871      1,542
                                                                           ------------------
Cash and cash equivalents at end of period .............................   $ 1,444    $ 1,936
                                                                           ==================
Supplemental Disclosures:
   Cash paid for:
      Interest .........................................................   $   791    $   797
      Income taxes .....................................................   $     9    $     9

   Change in gross unrealized gain/loss on securities available for sale   $  (254)   $   (82)

   Change in deferred taxes on unrealized gain/loss on securities
      available for sale ...............................................   $    97    $    31
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>


CSB Financial Group, Inc.

Notes to CONSOLIDATED Financial Statements
(in thousands, except per share data)
--------------------------------------------------------------------------------



Note 1.  Background Information

On October 5, 1995, CSB Financial  Group,  Inc. (the "Company")  acquired all of
the  outstanding  shares of Centralia  Savings Bank (the "Bank") upon the Bank's
conversion  from a state  chartered  mutual  savings  bank to a state  chartered
capital stock savings bank.  Centralia Savings Bank is located in Marion County,
Illinois.  The Company  purchased 100% of the  outstanding  capital stock of the
Bank using 50% of the net proceeds  from the Company's  initial  stock  offering
which was  completed on October 5, 1995.  The Company sold  1,035,000  shares of
$0.01 par value common stock at a price of $8 per share, including 82,800 shares
purchased by the Bank's Employee Stock Ownership Plan ("ESOP").  The ESOP shares
were acquired by the Bank with  proceeds from a Company loan totaling  $662,400.
The gross  proceeds  of the  offering  were  $8,280,000.  After  reducing  gross
proceeds for conversion costs of $696,000, net proceeds totaled $7,584,000.  The
Company's  stock was traded on the NASDAQ  Small  Caps  market  under the symbol
"CSBF"  until  December  31,  1998,  at which time the Company  transferred  the
quotation of its common stock to the OTC Bulletin Board under the same symbol.

The  acquisition  of the Bank by the Company was  accounted for as a "pooling of
interests" under generally accepted  accounting  principles.  The application of
the pooling of interests method records the assets and liabilities of the merged
entities on a historical cost basis with no goodwill or other intangible  assets
being recorded.


Note 2.  Basis of Presentation

The accompanying  consolidated  financial statements include the accounts of CSB
Financial Group, Inc., its wholly owned subsidiary,  Centralia Savings Bank, the
Bank, and the Bank's  wholly-owned  subsidiary,  Centralia  SLA.  Centralia SLA,
Inc.'s  principal  business  activity  is to  provide  insurance  services.  All
significant  intercompany  accounts and  transactions  have been  eliminated  in
consolidation.  The accompanying consolidated financial statements are unaudited
and should be read in conjunction with the consolidated financial statements and
notes  thereto  included in the Bank's annual report on Form 10-KSB for the year
ended  September 30, 1999. The  accompanying  unaudited  consolidated  financial
statements  have been  prepared in  accordance  with the  instructions  for Form
10-QSB and,  therefore,  do not include information or footnotes necessary for a
complete  presentation of financial condition,  results of operations,  and cash
flows in  conformity  with  generally  accepted  accounting  principles.  In the
opinion of  management  of the Company,  the  unaudited  consolidated  financial
statements  reflect all  adjustments  necessary to present  fairly the financial
position of the Company at March 31,  2000,  the results of  operations  for the
three months ended March 31, 2000 and 1999,  and the results of  operations  and
cash flows for the six months ended March 31, 2000 and 1999. All  adjustments to
the financial statements were normal and recurring in nature.

Operating  results for the six months  ended March 31, 2000 are not  necessarily
indicative of the results that may be expected for the year ending September 30,
2000.


Note 3.  Earnings Per Share

Basic  earnings per share ("EPS") is computed as net income  available to common
stockholders  divided by the weighted  average  common  shares  outstanding  and
vested shares of the Management Recognition Plan.

Diluted EPS is computed as net income available to common  stockholders  divided
by the weighted average common shares outstanding, common stock equivalents, and
shares  awarded under the  Management  Recognition  Plan weighted to reflect the
portion of the period the shares were outstanding.
<PAGE>


The following  reflects  earnings per share  calculations  for basic and diluted
methods:

                                                                 For the Six
                                                                Months Ended
                                                                  March 31,
                                                              ------------------
                                                                2000      1999
                                                              ------------------

Net income available to common shareholders ................. $    139  $    129

Basic diluted potential common shares:
   Weighted average shares outstanding ......................  713,005   710,968
   Management recognition plan shares vested ................    9,936     6,210
                                                              ------------------

Basic average shares outstanding ............................  722,941   717,178
                                                              ------------------
Diluted potential common shares:
   Management recognition plan shares granted, but not vested    7,452    11,178
   Stock option equivalents .................................   16,794       - -
                                                              ------------------

Diluted average shares outstanding ..........................  747,187   728,356
                                                              ------------------

Basic earnings per share .................................... $   0.19  $   0.18
                                                              ==================

Diluted earnings per share .................................. $   0.19  $   0.18
                                                              ==================
<TABLE>

                                                                  For The Three
                                                                  Months Ended
                                                                     March 31,
                                                                -------------------
                                                                  2000       1999
                                                                -------------------
<S>                                                             <C>        <C>
Net income available to common shareholders .................   $     55   $     81

Basic diluted potential common shares:
   Weighted average shares outstanding ......................    713,313    711,139
   Management recognition plan shares vested ................      9,936      6,210
                                                                -------------------

Basic weighted average shares outstanding ...................    723,249    717,349
                                                                -------------------
Diluted potential common shares:
   Management recognition plan shares granted, but not vested      7,452     11,178
   Stock option equivalents .................................     20,572        - -
                                                                -------------------

Diluted average shares outstanding ..........................    751,273    728,527
                                                                ===================

Basic earnings per share ....................................   $   0.08   $   0.11
                                                                ===================

Diluted earnings per share ..................................   $   0.07   $   0.11
                                                                ===================
</TABLE>

Note 4.  Employee Stock Ownership Plan

The ESOP acquired 82,800 shares of the Company's stock for future  allocation to
employees as part of the mutual to stock  conversion  process.  The purchase was
funded with a loan from the Company.

Shares are allocated to all eligible  employees as the debt is repaid based on a
prorata  share of total  eligible  compensation.  Employees  21 or older with at
least  1,000  hours  of  service  in a  twelve  month  period  are  eligible  to
participate.  Benefits  will vest over a five year period and in full after five
years of qualified service.
<PAGE>



As shares  are  committed  to be  released  from  unallocated  shares,  the Bank
recognizes compensation expense equal to the current market price of the shares,
and the shares  become  outstanding  for  purposes of  calculating  earnings per
share. The Bank recognized  compensation expense for the ESOP of $15 and $13 for
the six months ended March 31, 2000 and 1999, respectively.

Dividends  received,  if any, by the ESOP on unallocated shares will be used for
debt service.

In July 1997,  the Company  repurchased  41,400  shares of common stock from the
ESOP.  The ESOP  used  the  proceeds  received  from the  repurchase  to  reduce
outstanding debt to the Company. The balance in unearned ESOP shares was reduced
by the  cost of the  shares  sold to the  Company.  As of  March  31,  2000  and
September  30,  1999,  the  ESOP  held  18,785  and  20,021,  respectively,   of
non-committed shares with a fair value of $274 and $195, respectively.


Note 5.  Stock Option Plan

The Company has a stock  option  plan (SOP) which was  established  in 1996 with
103,500  shares of  common  stock.  The  options  are  granted  by a  Committee,
comprised of directors,  to key employees and directors based on their services.
The exercise price of options  granted must be at least equal to the fair market
value of the common stock on the date the option is granted. The options granted
under the plan become  exercisable  at a rate of 20 percent per year  commencing
one year after the grant date and 20  percent on each  anniversary  date for the
following four years. As of March 31, 2000, 61,750 options had been granted.

A  Nonqualified  Stock  Option Plan (SOP) was  established  in 1997 with 103,500
shares of common  stock.  The options are granted by a  committee,  comprised of
directors,  to key employees and directors based on their services. The exercise
price of the option  granted  must be at least equal to the fair market value of
the common stock on the date the option is granted. The terms of the options and
the  exercise  schedule  are  at the  discretion  of the  committee  and  option
agreements  need not be  identical.  As of March 31,  2000,  no options had been
granted.


 Note 6.  Management Recognition Plan

The  Management  Recognition  Plan  ("MRP")  was  approved  October 10, 1996 and
amended on January 9, 1997. Directors,  officers, and employees become vested in
the  shares of common  stock  awarded to them under the MRP at a rate of 20% per
year,  commencing one year after the grant date, and 20% on the anniversary date
thereof for the following four years.  As of March 31, 2000,  17,388 shares have
been awarded and remain outstanding to officers,  directors,  and employees. MRP
compensation  expense was $18 for the six months  ended March 31, 2000 and 1999.
Compensation  expense is recognized  over the vesting  period for shares awarded
under the plan.


Note 7.  Reclassifications

Certain  reclassifications  have been made to the balances for the period ending
March  31,  1999,  with no  effect  on net  income,  to be  consistent  with the
classifications adopted for March 31, 2000.


Note 8.  New Accounting Standards

Accounting  for  Derivative  Instruments  and Hedging  Activities  Statement  of
Financial  Accounting Standard No. 133,  "Accounting for Derivative  Instruments
and Hedging Activities" (FAS 133) establishes accounting and reporting standards
for derivative instruments, including certain derivative instruments embedded in
other contracts and for hedging activities. It requires that an entity recognize
all  derivatives  as either assets or  liabilities in the statement of financial
position and measure those instruments at fair value. The accounting for changes
in the fair value of a derivative  depends on the intended use of the derivative
and the resulting  designation.  This Statement applies to all entities. FAS 133
is effective for all fiscal  quarters of fiscal years  beginning  after June 15,
1999.  Earlier  application  is  encouraged.  The Statement is not to be applied
retroactively to financial  statements of prior periods. In June 1999, Statement
of Financial Accounting Standard No. 137 was issued to extend the effective date
by one year to all fiscal  quarters  of fiscal  years  beginning  after June 15,
2000.  The Company  does not believe the  adoption of FAS 133, as amended by FAS
137, will have a material impact on the consolidated financial statements.
<PAGE>



Accounting for  Mortgage-Backed  Securities Retained after the Securitization of
Mortgage  Loans  Held for Sale by a Mortgage  Banking  Enterprise  Statement  of
Financial   Accounting   Standard  No.  134,   "Accounting  for  Mortgage-Backed
Securities  Retained after the Securitization of Mortgage Loans Held for Sale by
a Mortgage Banking  Enterprise" (FAS 134) changes the way mortgage banking firms
account  for  certain   securities   and  other   interests  they  retain  after
securitizing  mortgage loans that were held for sale. The Statement is effective
for financial  statements for the first fiscal quarter  beginning after December
15,  1998.  The  Company  does not  securitize  mortgages  and is not a Mortgage
Banking  Enterprise  and  therefore,  FAS 134  will not  have an  impact  on the
consolidated financial statements.
<PAGE>


CSB Financial Group, Inc.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONs
( In thousands, except per share data)
--------------------------------------------------------------------------------

General

The  principal  assets of the Company are its  investment  in the Bank's  common
stock. The Company's  principal  revenue source is interest and dividends on its
investments.  The principal business of the Bank consists of attracting deposits
from the  general  public and using  these  funds to  originate  mortgage  loans
secured  by one- to  four-family  residences  located  primarily  in  Centralia,
Illinois and  surrounding  areas.  The Bank engages in various forms of consumer
and  commercial  lending  and invests in  mortgage-backed  U.S.  Government  and
federal  agency  securities,   local  municipal  issues,  and   interest-bearing
deposits. The Bank's profitability depends primarily on its net interest income,
which is the  difference  between the interest  income it earns on its loans and
investment  portfolio and its cost of funds,  which consists  mainly of interest
paid on  deposits.  Net interest  income is affected by the relative  amounts of
interest-earning assets,  interest-bearing  liabilities,  and the interest rates
earned or paid on these balances.

The Company's  profitability is also affected by the level of noninterest income
and expense.  Noninterest  income  consists  primarily of late charges and other
fees.  Noninterest expense consists of salaries and benefits,  occupancy related
expenses,  deposit  insurance  premiums  paid to the SAIF,  and other  operating
expenses.

The operations of the Company are  significantly  influenced by general economic
conditions and related  monetary and fiscal policies of financial  institutions'
regulatory  agencies.  Deposit  flows  and the cost of funds are  influenced  by
interest  rates on competing  investments  and general market rates of interest.
Lending  activities  are  affected by the demand for  financing  real estate and
other types of loans,  which in turn is affected by the interest  rates at which
such  financing may be offered and other factors  affecting  loan demand and the
availability of funds.

Business Strategy

The Company's  business  strategy is to operate the bank as a well  capitalized,
profitable and  independent  community  savings bank dedicated to financing home
ownership  and  consumer  needs in its  primary  market  area.  The  Company has
implemented this strategy by: (1) closely  monitoring the needs of customers and
providing  quality  service;  (2)  emphasizing   consumer-oriented   banking  by
originating  construction and permanent loans on residential and commercial real
estate  and  consumer  loans,  and by  offering  other  financial  services  and
products;  (3) improving and  maintaining  high asset quality;  (4)  maintaining
capital in excess of  regulatory  requirements;  and (5) managing  interest rate
risk by emphasizing the  origination of loans with  adjustable  rates or shorter
terms and  investments  in short-term  and liquid  investments.  The Company has
adopted various new business strategies intended to increase its presence in its
primary market area,  thereby  increasing its lending  activities and sources of
income.

Merger

On January 26,  2000,  the Company  signed a definitive  agreement  with Midland
States Bancorp,  Inc. Under the terms of the agreement,  Midland States Bancorp,
Inc. has agreed to purchase all of the issued and  outstanding  shares of common
stock of CSB Financial Group, Inc. for an aggregate cash  consideration of $11.7
million, or $16.00 per share, subject to certain  adjustments.  This transaction
is expected to be completed by July 31, 2000.

Liquidity and Capital Resources

The  Company's  primary  sources of funds  consists of deposits,  repayment  and
prepayment of loans,  maturities of investments and  interest-bearing  deposits.
Scheduled  repayments of loans and mortgage-backed  securities and maturities of
investment  securities are  predictable,  influenced by general  interest rates,
economic conditions,  and competition.  The Company uses its liquidity resources
principally  to fund  existing  and future loan  commitments,  to fund  maturing
certificates  of deposit  and  demand  deposit  withdrawals,  to invest in other
interest-earning  assets, to maintain liquidity, and to meet operating expenses.
Management  believes  that loan  repayments  and other  sources of funds will be
adequate to meet the Company's liquidity needs for the immediate future.
<PAGE>


A portion of the  Company's  liquidity  consists  of cash and cash  equivalents,
which include investments in highly liquid,  short-term  deposits.  The level of
these assets is dependent on the Company's  operating,  investing,  lending, and
financing  activities  during any given period.  At March 31, 2000 and September
30,  1999,  cash  and  cash   equivalents   totaled  $1,444  million  and  $871,
respectively. The increase in cash and cash equivalents is due to an increase in
deposits and the sale of investment securities to repay borrowings and fund loan
growth.

Liquidity  management  is  both a  daily  and  long-term  function  of  business
management.  If the Company  requires  funds beyond its ability to generate them
internally,  the Company may borrow additional funds from the FHLB. At March 31,
2000, the Company had no outstanding advances from the FHLB.

At March 31, 2000,  the Company had $1.8 million of  outstanding  commitments on
revolving lines of credit.

Regulatory Capital

Federally insured savings  associations are required to maintain a minimum level
of regulatory capital.  The Company and its subsidiary have capital ratios which
substantially exceed all regulatory  requirements.  The Company's capital ratios
are shown below.

                                          March 31,  September 30,    Minimum
                                            2000          1999      Requirements
                                          --------------------------------------

Total capital to risk weighted assets       39.1%         43.9%         8.0%
Tier I capital to risk weighted assets      38.2%         42.9%         4.0%
Tier I capital to average assets            20.3%         20.3%         4.0%

Financial Condition

Total  assets  increased  $140 to  $49,060  at March 31,  2000 from  $48,920  at
September 30, 1999.  The increase  resulted from an increase of $573 in cash and
cash  equivalents  due to sales,  calls and maturities of investments  and a net
increase in deposit  accounts of $1,675,  offset by an increase in loans of $970
and repayment of FHLB Advances of $1,400.


Gross loans have increased $968 from $29,142 at September 30, 1999 to $30,110 at
March 31,  2000.  The growth in the loan  portfolio  is  comprised  primarily of
commercial lending.

Securities  decreased  $1,320 since  September 30, 1999.  The decrease is due to
maturities of U.S. Treasury  securities,  sale of mortgage backed securities and
an overall  decline in market  values.  All securities are held as available for
sale.

Results of Operations

Three months ended March 31, 2000 compared to three months ended March 31, 1999

Net Income - The  Company's net income for the three months ended March 31, 2000
was $55 compared to $81 for the three months ended March 31, 1999. The principal
cause of the decrease in net income  resulted  from an increase in  professional
fees related to the pending sale of the Company.  This decrease was mitigated by
a  modest  increase  in net  interest  margin  and a slight  reduction  of other
noninterest expense.

Interest Income - Interest income increased for the three months ended March 31,
2000 by $30 to $848 from $818 for the three  months  ended March 31,  1999.  The
increase is due to consistent  yields and an increase in the average  balance of
interest earning assets for the respective periods.

Interest Expense - Interest  expense  increased for the three months ended March
31, 2000 by $20 to $412 from $392 for the three months ended March 31, 1999. The
increase  in  interest  expense  is solely  attributed  to  interest  expense on
borrowed funds that were not necessary in 1999.

Net Interest  Income - Net interest  income for the three months ended March 31,
2000  increased  by $10 to $436 from $426 for the three  months  ended March 31,
1999.  The increase is  attributable  to the increase in the  Company's  average
balance of loans for the respective period.
<PAGE>


Noninterest  Expense - Noninterest  expense increased for the three months ended
March 31,  2000 by $55 to $380 from $325 for the three  months  ended  March 31,
1999.  Compensation  cost increased for the quarter by $10 and audit,  legal and
other professional costs increased $63. These increases were partially offset by
a  $16  decrease  in  data  processing  expenses  and a $10  decrease  in  other
noninterest expense.

Six months ended March 31, 2000 compared to six months ended March 31, 1999

Net Income -The Company's net income for the six months ended March 31, 2000 was
$139  compared to $129 for the six months ended March 31, 1999.  The increase is
mainly attributable to an increase in net interest income, offset by an increase
in noninterest expenses.

Interest  Income - Interest  income  increased  $70 from  $1,622 to $1,692 or by
4.32%,  during the six months  ended March 31, 2000  compared to the  respective
period of 1999.  This increase  resulted from an increase in the average balance
of interest earning assets and a consistent yield.

Interest Expense - Interest expense  increased $21 or 2.63%, to $818 for the six
months ended March 31, 2000 from $797 for the same period in 1999.  The increase
in interest  expense on  borrowings  of $36 was offset by a decrease in interest
expense on deposits of $15 due to  decreasing  cost of funds which is consistent
with market conditions.

Net  Interest  Income - Net  interest  income for the six months ended March 31,
2000 was $874  compared  to $825 for the six months  ended March 31,  1999.  The
increase is  attributable to an increase in loans and deposits during the period
combined with a slight increase in the net interest margin.

Noninterest  Expense -  Noninterest  expense  increased for the six months ended
March 31, 2000 by $95 to $765 from $670 for the six months ended March 31, 1999.
Audit,  legal and other  professional  costs  increased  $76 due to the  pending
merger. In addition,  compensation costs increased $10 and data processing costs
increased $11. These  increases were partially  offset by a $7 decrease in other
noninterest expense.

Provision for Loan Losses - The allowance for loan losses is established through
a  provision  for loan  losses  based  on  management's  evaluation  of the risk
inherent  in its  loan  portfolio  and  the  general  economy.  Such  evaluation
considers  numerous  factors  including,   general  economic  conditions,   loan
portfolio  composition,  prior loss experience,  the estimated fair value of the
underlying  collateral  and other factors that warrant  recognition in providing
for an adequate loan loss allowance.  During the six months ended March 31, 2000
and 1999, the provision for loan losses was $17 and $36, respectively.

Allowance  for Loan Losses - The  allowance  for loan losses was $220 or .73% of
loans  receivable  at  March  31,  2000,  compared  to  $222,  or .76% of  loans
receivable at September 30, 1999. The level of  nonperforming  loans was .40% of
total loans at March 31, 2000 compared to .70% as of September  30, 1999.  Based
on the  relationship  of the  allowance  for  loan  losses  to total  loans  and
classified  assets  and the focus on  identifying  and  resolving  problem  loan
situations, management believes the allowance for loan losses is adequate.

Net charge-offs amounted to $19 during the first six months of fiscal year 2000,
compared  to net  charge-offs  of $11 during the first six months of fiscal year
1999.

The allowance for loan losses is established through a provision for loan losses
charged to expense. Loans are charged against the allowance for loan losses when
management  believes that the  collectibility of the principal is unlikely.  The
allowance  is an amount  that  management  believes  will be  adequate to absorb
losses on existing loans that may become  uncollectible,  based on evaluation of
the collectibility of loans and prior loss experience. The evaluation also takes
into  consideration such factors as changes in the nature and volume of the loan
portfolio,  overall  portfolio  quality,  review of specific  problem  loans and
current economic conditions that may affect the borrowers' ability to pay. While
management uses the best  information  available to make its evaluation,  future
adjustments to the allowance may be necessary if there are  significant  changes
in economic conditions. In addition, regulatory agencies, as an integral part of
their  examination  process,  periodically  review the Bank's allowance for loan
losses,  and may require the Bank to make  additions to the  allowance  based on
their  judgment  about  information  available  to  them at the  time  of  their
examinations.
<PAGE>


Loans are considered  impaired when, based on current information and events, it
is  probable  that the Bank will not be able to collect  all  amounts  due.  The
portion of the allowance for loan losses  applicable to impaired  loans has been
computed  based on the  present  value of the  estimated  future  cash  flows of
interest and principal  discounted at the loan's  effective  interest rate or on
the fair value of the  collateral  for collateral  dependent  loans.  The entire
change  in  present  value  of  expected  cash  flows  of  impaired  loans or of
collateral  value is  reported  as bad debt  expense in the same manner in which
impairment  initially was recognized or as a reduction in the amount of bad debt
expense that otherwise would be reported. As of March 31, 2000 and September 30,
1999, management had not identified any loans as impaired.

Nonperforming Assets

At March 31, 2000, the Bank had $121, of nonperforming assets, representing .25%
of total  assets.  On  September  30, 1999,  the Bank had $205 of  nonperforming
assets, representing .42% of total assets.

Impact on Inflation and Changing Prices

The  unaudited  consolidated  financial  statements  and related data  presented
herein have been  prepared in  accordance  with  generally  accepted  accounting
principles,  which require the measurement of financial  position and results of
operations in terms of historical  dollars  without  considering  changes in the
relative  purchasing power of money over time because of inflation.  Unlike most
industrial companies, virtually all of the assets and liabilities of the Company
are  monetary in nature.  As a result,  interest  rates have a more  significant
impact on the  Company's  performance  than the  effects  of  general  levels of
inflation.  Interest rates do not  necessarily  move in the same direction or in
the same magnitude as the prices of goods and services.
<PAGE>



                           PART II - OTHER INFORMATION


Item 1.  Legal Proceedings

         The Company is, from time to time, a party to legal proceedings arising
in the ordinary course of its business,  including legal  proceedings to enforce
its rights against borrowers.  The Company is not currently a party to any legal
proceedings which could reasonably be expected to have a material adverse effect
on the consolidated financial condition or operations of the Company.

         In May 1999, a shareholder  of CSB Financial  Inc. filed a class action
lawsuit in a Delaware  court  against the  Company,  its top  executive  and its
directors for breach of fiduciary duty for failure to put an  acquisition  offer
to  shareholder  vote.  The class action is seeking  buyout of current shares at
$14.75 (offered purchase price).

Item 2.  Changes in Securities

         None.

Item 3.  Defaults Upon Senior 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 8K

         Exhibits:

         None.

         Reports on Form 8K:

         Form 8K was filed on January 27,  2000  announcing  that CSB  Financial
         Group,  Inc. had signed a definitive  Merger  Agreement  providing  for
         Midland States Bancorp's acquisition of CSB Financial Group, Inc.




<PAGE>


                                   SIGNATURES


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




                                            CSB Financial Group, Inc.



Date:  May 15, 2000                         /s/ K. Gary Reynolds
       -----------------------              -----------------------------------
                                            K. Gary Reynolds
                                            Chief Executive Officer and Director



Date:  May 15, 2000                         /s/ Joanne Ticknor
       ------------------------             ------------------------------------
                                            Joanne Ticknor
                                            Secretary and Treasurer