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, 1999

                                       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 April 26, 1999
-----------------------------               ------------------------------------
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, 1999 and September 30, 1998
(in thousands, except share data)

                                              
ASSETS                                        March 31, September 30,   
                                                1999         1998
---------------------------------------------------------------------
                                             (Unaudited)  (Audited)

Cash and cash equivalents ................    $  1,936     $  1,542
Securities:
   Available for sale ....................      15,555       16,931
   Nonmarketable equity securities .......         211          215
Loans ....................................      28,749       26,282
Allowance for loan losses ................        (196)        (171)
                                              ---------------------
              Loans, net .................      28,553       26,111
Premises and equipment ...................         594          607
Accrued interest receivable ..............         306          304
Intangible assets ........................         569          600
Other assets .............................          63          113
                                              ---------------------
              Total assets ...............    $ 47,787     $ 46,423
                                              =====================

<PAGE>


CSB FINANCIAL GROUP, INC. and SUBSIDIARY

Consolidated Balance Sheets
March 31, 1999 and September 30, 1998
(in thousands, except share data)
<TABLE>


                                                                  
                                                                    
LIABILITIES AND STOCKHOLDERS'  EQUITY                             March 31, September 30,                                
                                                                    1999        1998
-----------------------------------------------------------------------------------------
                                                                (Unaudited)  (Audited)
<S>                                                                <C>        <C> 
LIABILITIES:
   Deposits:
      Demand ...................................................   $ 9,581    $ 8,543
      Savings ..................................................     3,705      3,387
      Time deposits > $100,000 .................................     2,697      1,680
      Other time deposits ......................................    21,195     22,245
                                                                   ------------------
              Total deposits ...................................    37,178     35,855
                                                                   ------------------
   Other liabilities ...........................................       141        169
   Deferred income taxes .......................................       235        270
                                                                   ------------------
              Total liabilities ................................    37,554     36,294
                                                                   ------------------

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 .............................................     7,826      7,823
   Retained earnings ...........................................     6,513      6,384
   Accumulated other comprehensive income ......................       103        154
   Unearned employee stock ownership plan shares ...............      (170)      (180)
   Management recognition plan .................................      (533)      (551)
                                                                   ------------------
                                                                    13,749     13,640
   Less cost of treasury stock; 302,701 shares at March 31, 1999
      and 302,080 shares at September 30, 1998 .................    (3,516)    (3,511)
                                                                   ------------------
              Total stockholders' equity .......................    10,233     10,129
                                                                   ------------------

              Total liabilities and stockholders' equity .......   $47,787   $ 46,423
                                                                   ==================
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>


CSB Financial Group, Inc.
Consolidated Statements of Income
Six Months Ended March 31, 1999 and 1998
(Unaudited, in thousands, except per share data)
<TABLE>

                                                                   Six Months Ended
                                                                       March 31,
                                                                   -----------------
                                                                      1999     1998
                                                                   -----------------
<S>                                                                <C>      <C>   
Interest income:
   Loans and fees on loans ......................................  $  1,094 $  1,120
   Securities ...................................................       528      561
                                                                   -----------------
              Total interest income .............................     1,622    1,681
                                                                   -----------------

Interest expense on deposits ....................................       797      824
                                                                   -----------------

              Net interest income ...............................       825      857
Provision for loan losses .......................................        36       30
                                                                   -----------------

              Net interest income after provision for loan losses       789      827
                                                                   -----------------

Noninterest income:
   Service charges on deposits ..................................        39       41
   Gain on sale of securities, net ..............................       - -        3
   Gain on sale of loans, net ...................................       - -        2
   Other ........................................................        25       22
                                                                   -----------------
              Total noninterest income ..........................        64       68
                                                                   -----------------

Noninterest expense:
   Compensation and employee benefits ...........................       326      324
   Occupancy and equipment ......................................        47       42
   Data processing ..............................................        54       50
   Audit, legal and other professional ..........................        46       55
   Other ........................................................       197      188
                                                                   -----------------
              Total noninterest expense .........................       670      659
                                                                   -----------------
              Income before income taxes ........................       183      236
Income taxes ....................................................        54       55
                                                                   -----------------
              Net income ........................................  $    129 $    181
                                                                   =================

Earnings per share
   Basic ........................................................  $  0.18  $   0.23
                                                                   =================
   Diluted ......................................................  $  0.18  $   0.22
                                                                   =================

Weighted average shares outstanding
   Basic ........................................................  717,178   777,488
                                                                   =================
   Diluted ......................................................  728,356   807,959
                                                                   =================
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>


CSB Financial Group, Inc.
Consolidated Statements of comprehensive income
Six Months Ended March 31, 1999 and 1998
(Unaudited, in thousands, except per share data)



                                                                   Six Months
                                                                 Ended March 31,
                                                                 ---------------
                                                                   1999    1998
                                                                  --------------

Net income ................................................       $  129 $   181

Change in unrealized gain on securities available for sale,
   net of tax of $(31) and $9 .............................          (51)     14

Less:  Reclassification adjustment, net of tax of $0 and $1          - -       2
                                                                 ---------------
                                                                     (51)     16
                                                                 ---------------

Comprehensive income ......................................      $    78 $   197
                                                                 ===============


See Notes to Consolidated Financial Statements.
<PAGE>


CSB Financial Group, Inc.
Consolidated Statements of Income
Three Months Ended March 31, 1999 and 1998
(Unaudited, in thousands, except per share data)
<TABLE>

                                                                     Three Months Ended
                                                                          March 31,
                                                                     -------------------
                                                                       1999       1998
                                                                     -------------------
<S>                                                                  <C>         <C> 
Interest income:
   Loans and fees on loans ......................................    $   564     $   552
   Securities ...................................................        254         277
                                                                     -------------------
              Total interest income .............................        818         829
                                                                     -------------------

Interest expense on deposits ....................................        392         407
                                                                     -------------------

              Net interest income ...............................        426         422
Provision for loan losses .......................................         18          15
                                                                     -------------------

              Net interest income after provision for loan losses        408         407
                                                                     -------------------

Noninterest income:
   Service charges on deposits ..................................         19          19
   (Loss) on sale of securities, net ............................        - -          (5)
   Gain on sale of loans, net ...................................        - -           2
   Other ........................................................         10          14
                                                                     -------------------
              Total noninterest income ..........................         29          30
                                                                     -------------------

Noninterest expense:
   Compensation and employee benefits ...........................        157         148
   Occupancy and equipment ......................................         23          21
   Data processing ..............................................         29          25
   Audit, legal and other professional ..........................         15          25
   Other ........................................................        101          96
                                                                     -------------------
              Total noninterest expense .........................        325         315
                                                                     -------------------
              Income before income taxes ........................        112         122
Income taxes ....................................................         31          38
                                                                     -------------------
              Net income ........................................    $    81    $     84
                                                                     ===================

Earnings per share
   Basic ........................................................    $  0.11    $   0.11
                                                                     ===================
   Diluted ......................................................    $  0.11    $   0.10
                                                                     ===================

Weighted average shares outstanding
   Basic ........................................................    717,349     777,542
                                                                     ===================
   Diluted ......................................................    728,527     808,752
                                                                     ===================
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>


CSB Financial Group, Inc.
Consolidated Statements of comprehensive income
Three Months Ended March 31, 1999 and 1998
(Unaudited, in thousands, except per share data)



                                                                 Three Months
                                                                Ended March 31,
                                                                ----------------
                                                                 1999     1998
                                                                ----------------

Net income ..................................................   $   81  $    84

Change in unrealized gain on securities available for sale,
   net of tax of $(30) and $12 ..............................      (49)      20

Less:  Reclassification adjustment, net of tax of $0 and $(2)      - -       (3)
                                                                ----------------
                                                                   (49)      17
                                                                ----------------

Comprehensive income ........................................   $   32  $   101
                                                                ================


See Notes to Consolidated Financial Statements.
<PAGE>


CSB Financial Group, Inc.
Consolidated Statements of CASH FLOWS
Six Months Ended March 31, 1999 and 1998
(Unaudited, in thousands)


                                                                 Six Months
                                                              Ended March 31,
                                                              ----------------
                                                                1999    1998
                                                              ----------------
Cash Flows from Operating Activities:
   Net income .............................................   $  129   $   181
   Adjustments to reconcile net income to net cash provided
      by operating activities:
      Provision for loan losses ...........................       36        30
      Provision for depreciation ..........................       21        18
      Deferred income taxes ...............................       (4)
      Amortization of intangible assets ...................       31        30
      Employee stock ownership plan compensation expense ..       13        19
      Management recognition plan compensation expense ....       18        19
      Originations of loans held for sale .................      - -      (653)
      Proceeds from loans held for sale ...................      - -       302
      Gain on sale of securities ..........................      - -        (3)
      Gain on sale of loans ...............................      - -        (2)
      Loss on the sale of other real estate owned .........      - -         2
      Amortization and accretion on securities ............        6         1
      Change in assets and liabilities:
        (Increase) in accrued interest receivable .........       (2)      (34)
        Decrease in other assets ..........................       50        39
        (Decrease) increase in other liabilities ..........      (28)       75
                                                              ----------------
              Net cash provided by operating activities ...      270        24
                                                              ----------------

Cash Flows from Investing Activities:
   Securities available for sale:
      Purchases ...........................................   (3,453)   (7,759)
      Proceeds from sales .................................      - -     3,003
      Proceeds from maturities and paydowns ...............    4,741     4,493
   Proceeds from sales of nonmarketable equity securities .        4       - -
   (Increase) in loans ....................................   (2,478)      (36)
   Proceeds from the sale of other real estate owned ......      - -        26
   Purchase of premises and equipment .....................       (8)      (13)
                                                              ----------------
              Net cash (used in) investing activities .....   (1,194)     (286)
                                                              ----------------


                                   (Continued)




<PAGE>


CSB Financial Group, Inc.
Consolidated Statements of Cash Flows, (continued)
Six Months Ended March 31, 1999 and 1998
(Unaudited, in thousands)
<TABLE>

                                                                               Six Months
                                                                             Ended March 31,
                                                                           -----------------
                                                                             1999     1998
                                                                           -----------------
<S>                                                                        <C>       <C> 
Cash Flows from Financing Activities:
   Increase (decrease) in deposits .....................................   $ 1,323   $   (88)
   Purchase of treasury stock ..........................................        (5)     (783)
                                                                           -----------------
              Net cash provided by (used in) financing activities ......     1,318      (871)

              Increase (decrease) in cash and cash equivalents .........       394    (1,133)

Cash and cash equivalents at beginning of period .......................     1,542     2,675
                                                                           -----------------

Cash and cash equivalents at end of period .............................   $ 1,936   $ 1,542
                                                                           =================

Supplemental Disclosures:
   Cash paid for:
      Interest on deposits .............................................   $   797   $   826
      Income taxes .....................................................   $     9   $    21

   Change in gross unrealized gain/loss on securities available for sale   $   (82)  $    26

   Change in deferred taxes on unrealized gain/loss on securities
      available for sale ...............................................   $    31   $    10

</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 Masson 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, 1998. 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,  1999,  the results of  operations  for the
three months ended March 31, 1999 and 1998,  and the results of  operations  and
cash flows for the six months ended March 31, 1999 and 1998. All  adjustments to
the financial statements were normal and recurring in nature.

Operating  results for the six months  ended March 31, 1999 are not  necessarily
indicative of the results that may be expected for the year ending September 30,
1999.

Note 3.  Comprehensive Income

Effective  October 1, 1998,  the Bank adopted FASB  Statement No. 130, which was
issued in June 1997.  Statement No. 130  establishes new rules for the reporting
and display of comprehensive income and its components, but has no effect on the
Bank's net income or total  stockholders'  equity.  Statement  No. 130  requires
unrealized gains and losses on the Bank's available-for-sale  securities,  which
prior to adoption  were  reported  separately  in  stockholders'  equity,  to be
included in  comprehensive  income.  Prior year financial  statements  have been
reclassified to conform to the requirements of Statement No. 130.
<PAGE>


Note 4.  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.

The following  reflects  earnings per share  calculations  for basic and diluted
methods:
<TABLE>
                                                                For the Six Months
                                                                  Ended March 31,
                                                                -------------------
                                                                  1999       1998
                                                                -------------------
<S>                                                             <C>       <C>   
Net income available to common shareholders .................   $    129   $    181

Basic diluted potential common shares:
   Weighted average shares outstanding ......................    710,968    773,762
   Management recognition plan shares vested ................      6,210      3,726
                                                                -------------------

Basic average shares outstanding ............................    717,178    777,488
                                                                -------------------

Diluted potential common shares:
   Management recognition plan shares granted, but not vested     11,178     14,904
   Stock option equivalents .................................        - -     15,567
                                                                -------------------

Diluted average shares outstanding ..........................    728,356    807,959
                                                                -------------------

Basic earnings per share ....................................   $   0.18   $   0.23
                                                                ===================

Diluted earnings per share ..................................   $   0.18   $   0.22
                                                                ===================

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


Net income available to common shareholders .................   $     81   $     84

Basic diluted potential common shares:
   Weighted average shares outstanding ......................    711,139    773,816
   Management recognition plan shares vested ................      6,210      3,726
                                                                -------------------

Basic weighted average shares outstanding ...................    717,349    777,542
                                                                -------------------

Diluted potential common shares:
   Management recognition plan shares granted, but not vested     11,178     14,904
   Stock option equivalents .................................        - -     16,306
                                                                -------------------

Diluted average shares outstanding ..........................    728,527    808,752
                                                                -------------------

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

Diluted earnings per share ..................................   $   0.11   $   0.10
                                                                ===================
</TABLE>
<PAGE>


Note 5.  Employee Stock Ownership Plan

In conjunction with the conversion, an ESOP was created and 82,800 shares of the
Company's stock were purchased for future allocation to employees.  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.

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 $13 and $19 for
the six months ended March 31, 1999 and 1998, 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,  1999  and
September  30,  1998,  the  ESOP  held  21,284  and  22,529,  respectively,   of
non-committed shares with a fair value of $192 and $281, respectively.


Note 6.  Stock Option Plan

At the annual  stockholder's  meeting on May 22,  1996,  the Stock  Option  Plan
("SOP") was approved. The board has reserved an amount of stock equal to 103,500
shares or 10% of the common stock sold in the  conversion for issuance under the
SOP. The options will be 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, 1999, 61,750 options had been granted.

The Board  adopted  the 1997  Nonqualified  Stock  Option  Plan (SOP)  effective
January 9, 1997.  The Board has  reserved up to 103,500  shares of common  stock
under  the SOP.  The  options  will be  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,  1999,  no options had been
granted.


Note 7.  Management Recognition Plan

The Management  Recognition  Plan ("MRP") was approved with an effective date of
October  10,  1996 and  amended on January 9, 1997.  The MRP intends to purchase
with funds  provided  by the  Company,  whether  in the open  market or from the
Holding Company in the form of newly issued shares,  62,100 shares, or 6% of the
aggregate  number of shares of Common Stock issued and sold in  connection  with
the Conversion for issuance to officers, directors, and employees of the Holding
Company.  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, 1999,  17,388 shares have been awarded and
remain  outstanding  to officers,  directors,  and employees.  MRP  compensation
expense  was $18 and $19 for the six  months  ended  March  31,  1999 and  1998,
respectively.  The  bank  accounts  for its MRP in  accordance  with  Accounting
Principles  Board  Statement 25.  Compensation  expense is  recognized  over the
vesting period for shares awarded under the plan.
<PAGE>


Note 8.  New Accounting Standards

Disclosures about Segments of an Enterprise and Related Information Statement of
Financial  Accounting  Standard  No.  131,  "Disclosures  about  Segments  of an
Enterprise  and Related  Information"  (FAS 131), was issued in July 1997 by the
Financial  Accounting  Standards Board. The standard requires the Corporation to
disclose the factors used to identify reportable segments including the basis of
organization,  differences  in products  and  services,  geographic  areas,  and
regulatory  environments.  FAS 131 additionally requires financial results to be
reported in the financial  statements for each reportable segment.  The Standard
is effective for financial  statement  years  beginning after December 15, 1997.
The  Statement is not  expected to have a  significant  impact on the  Company's
current business segment disclosures.

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.  The Company does not
believe the adoption of FAS 133 will have a material 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  and the net  proceeds  from the  sale of the  Company's  common  stock in
connection  with the  conversion.  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 Bank'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 Bank 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  business  strategy  is to operate  as a well  capitalized,  profitable  and
independent  community  savings bank  dedicated to financing  home ownership and
consumer  needs in its  primary  market  area.  The Bank  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 Bank 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.

Liquidity and Capital Resources

The  Bank'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 Bank 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 Bank's liquidity needs for the immediate future.
<PAGE>


A portion of the Bank'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 Bank's operating,  investing,  lending, and financing
activities  during any given  period.  At March 31, 1999 and September 30, 1998,
cash and cash equivalents  totaled $1.9 million and $1.5 million,  respectively.
The decrease in cash and cash equivalents is due to an increase in the Company's
investment in municipal securities and an increase in mortgage lending.

Liquidity  management  is  both a  daily  and  long-term  function  of  business
management.  If the Bank  requires  funds  beyond its ability to  generate  them
internally,  the Bank may borrow  additional  funds from the FHLB.  At March 31,
1999, the Bank had no outstanding advances from the FHLB.

At March 31,  1999,  the Bank had $2.2  million of  outstanding  commitments  to
originate loans.

Regulatory Capital

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

                                         March 31,  September 30,     Minimum
                                           1999        1998         Requirements
                                         ---------------------------------------

Total capital to risk weighted assets      42.1%       46.2%             8.0%
Tier I capital to risk weighted assets     41.3%       45.3%             4.0%
Tier I capital to average assets           20.1%       19.8%             4.0%

Financial Condition

Total  assets  increased  $1,364 to  $47,787 at March 31,  1999 from  $46,423 at
September 30, 1998.  The increase  resulted from an increase of $394 in cash and
cash  equivalents  due to calls and maturities of investments and a net increase
in deposit accounts of $1,323, offset by an increase in loans of $2,467.

Gross loans have increased  $2,467 from $26,282 at September 30, 1998 to $28,749
at March 31, 1999.  The growth in the loan  portfolio is comprised  primarily of
mortgage  lending.  As the Company  continues to see growth in mortgage lending,
alternative sources of funding are evaluated.  The Bank continues to focus their
efforts  in the  expansion  of the  commercial  loan  market  and  continues  to
originate commercial loans which meet prudent underwriting standards.

Securities  decreased  $1,380 since  September 30, 1998.  The decrease is due to
calls and  maturities  of U.S.  Treasury  securities  and an overall  decline in
market values. All securities are held as available for sale.

Results of Operations

Three months ended March 31, 1999 compared to three months ended March 31, 1998

Net Income - The  Company's net income for the three months ended March 31, 1999
was $81 compared to $84 for the three months ended March 31, 1998.  The decrease
in net income resulted  primarily from a decrease in interest income  recognized
on securities.

Interest Income - Interest income decreased for the three months ended March 31,
1999 by $11 to $818 from $829 for the three  months  ended March 31,  1998.  The
decrease is due to decreasing  yields on the average balance of interest earning
assets for the respective periods due to current market conditions.

Interest Expense - Interest  expense  decreased for the three months ended March
31, 1999 by $15 to $392 from $407 for the three months ended March 31, 1998. The
deposit  portfolio has remained  relatively  consistent,  however current market
conditions have caused a decline in cost of funds. Management continues to price
deposit products in order to remain competitive in the local economy.

Net Interest  Income - Net interest  income for the three months ended March 31,
1999  increased  by $4 to $426 from $422 for the three  months  ended  March 31,
1998.  The increase is  attributable  to the increase in the  Company's  average
balance of loans for the respective period.

Noninterest  expense  increased for the three months ended March 31, 1999 by $10
to $325 from $315 for the three months ended March 31, 1998.  Compensation  cost
increased  for the  quarter by $9.  This  increase  was offset by a decrease  in
audit, legal and other professional costs of $10.
<PAGE>


Six months ended March 31, 1999 compared to six months ended March 31, 1998

Net Income -The Company's net income for the six months ended March 31, 1999 was
$129  compared to $181 for the six months ended March 31, 1998.  The decrease is
mainly  attributable to a decrease in net interest  income.  The decrease in net
interest  income is a result of current market  conditions.  Results for the six
months ended March 31, 1998 also include  gains on the sale of  securities of $3
as management realigned the investment portfolio.

Interest  Income - Interest  income  decreased  $59 from  $1,681 to $1,622 or by
3.51%,  during the six months  ended March 31, 1999  compared to the  respective
period  of 1998.  This  decrease  resulted  from a  decrease  in the  investment
portfolio, combined with a decrease in current market rates.

Interest Expense - Interest expense  decreased $27 or 3.28%, to $797 for the six
months ended March 31, 1999 from $824 for the same period in 1998.  The decrease
is attributable  to the decrease in the Company's  other time deposits,  however
the deposit portfolio has remained relatively consistent.

Net  Interest  Income - Net  interest  income for the six months ended March 31,
1999 was $825  compared  to $857 for the six months  ended March 31,  1998.  The
decrease is attributable to an increase in loans and deposits during the quarter
combined with a decrease in the  Company's  average  balance of  securities  and
decreasing market rates.

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, 1999
and 1998, the provision for loan losses was $36 and $30, respectively.

Allowance  for Loan Losses - The  allowance  for loan losses was $196 or .68% of
loans  receivable  at  March  31,  1999,  compared  to  $171,  or .65% of  loans
receivable at September 30, 1998. The level of nonperforming  loans was 1.31% of
total loans at March 31, 1999 compared to 1.56% as of September 30, 1998.  Based
on current  reserve levels in relation to total loans  receivable and classified
assets and the diligent  effort put forth by management to address  problem loan
situations  in recent  years,  management  believes its  reserves are  currently
adequate.

Net charge-offs amounted to $11 during the first six months of fiscal year 1999,
compared  to net  charge-offs  of $13 during the first six months of fiscal year
1998.

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.

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, 1999 and September 30,
1998, management had not identified any loans as impaired.
<PAGE>


Nonperforming Assets

At March 31, 1999, the Bank had $378, of nonperforming assets, representing .79%
of total  assets.  On  September  30, 1998,  the Bank had $410 of  nonperforming
assets, representing .88% 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

         None.

Item 2.  Changes in Securities

         None.

Item 3.  Defaults Upon Senior Securities

         None.

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

         Not applicable.

Item 5.  Other Information

         None.

Item 6.  Exhibits and Reports on Form 8K

         Exhibits:

         None.

         Reports on Form 8K:

         None.




<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 5, 1999                           /s/ K. Gary Reynolds
      ------------------------              ------------------------------------
                                            K. Gary Reynolds
                                            Chief Executive Officer and Director



Date: May 5, 1999                           /s/ Joanne Ticknor
      ------------------------              ------------------------------------
                                            Joanne Ticknor
                                            Secretary and Treasurer