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


                                   FORM 10-QSB


             |X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                          THE SECURITIES EXCHANGE ACT
                                     OF 1934

                  For the quarterly period ended March 31, 2003
                                                 --------------

                                       OR

            [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                            THE EXCHANGE ACT OF 1934

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

                         Commission file number: 0-25854


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


Delaware
-------------------------------------------------------------
(State or Other Jurisdiction of Incorporation or Organization)

                                                                04-2095007
                                                             -------------------
                                                              (I.R.S. Employer
                                                             Identification No.)
221 West Aztec Avenue, Gallup, New Mexico
-----------------------------------------
(Address of Principal Executive Offices)
                                                           87301
                                                         ----------
                                                         (Zip Code)

Issuer's Telephone Number, Including Area Code:        (505) 726-6500
                                                     ------------------

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

As of May 3, 2003,  there were issued and  outstanding  1,146,270  shares of the
registrant's Common Stock.

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


<PAGE>

                               GFSB Bancorp, Inc.

<TABLE>
<CAPTION>

                                      Index
                                                                                                    Page No.
                                                                                                    --------
<S>                                                                                                 <C>
                          PART I. FINANCIAL INFORMATION

Item 1.    Condensed Consolidated Financial Statements:

           Condensed Consolidated Statements of Financial Condition
               March 31, 2003 and June 30, 2002                                                         3

           Condensed Consolidated Statements of Earnings and Comprehensive Earnings
               Three months and nine months ended March 31, 2003 and March 31, 2002                     4

           Condensed Consolidated Statements of Cash Flows
               Nine months ended March 31, 2003 and March 31, 2002                                      6

           Notes to Condensed Consolidated Financial Statements                                         8

Item 2.    Management's Discussion and Analysis or Plan of Operation                                    9

Item 3.    Controls and Procedures                                                                     15

                           PART II. OTHER INFORMATION

Item 1.    Legal Proceedings                                                                           16

Item 2.    Changes in Securities and Use of Proceeds                                                   16

Item 3.    Defaults Upon Senior Securities                                                             16

Item 4.    Submission of Matters to a Vote of Security Holders                                         16

Item 5.    Other Information                                                                           16

Item 6.    Exhibits and Reports on Form 8-K                                                            16

           Signatures                                                                                  17

</TABLE>
                                        2
<PAGE>

                               GFSB Bancorp, Inc.

            CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

<TABLE>
<CAPTION>
                                                                March 31,        June 30,
                                                                  2003             2002
                                                             -------------    -------------
                                                              (Unaudited)
                                     ASSETS
<S>                                                        <C>              <C>
Cash and due from banks                                      $   5,243,534    $   4,825,439
Interest-bearing deposits with banks                               536,318          826,052
Available-for-sale investment securities                        24,608,269       23,973,426
Available-for-sale mortgage-backed securities                   33,694,100       27,290,274
Held-to-maturity investment securities                           1,675,108        1,405,403
Stock of Federal Home Loan Bank, at cost, restricted             4,306,000        4,218,500
Loans receivable, net, substantially pledged                   142,064,977      139,748,188
Accrued interest and dividends receivable                          972,114        1,073,201
Premises and equipment                                           2,387,553        2,511,173
Other real estate and repossessed property                         159,538          150,642
Prepaid and other assets                                           165,934          122,771
                                                             -------------    -------------

        TOTAL ASSETS                                         $ 215,813,445    $ 206,145,069
                                                             =============    =============


                      LIABILITIES AND STOCKHOLDERS' EQUITY

Transaction and NOW accounts                                 $  22,718,373    $  20,417,085
Savings and MMDA deposits                                       17,298,313       17,305,540
Time deposits                                                   80,443,284       72,626,849
Advances from Federal Home Loan Bank                            75,068,265       76,386,455
Repurchase agreements                                              772,393        1,234,857
Accrued interest payable                                           507,943          448,955
Advances from borrowers for taxes and insurance                    615,525          416,575
Accounts payable and accrued liabilities                           402,000          245,409
Deferred income taxes                                              553,745          568,728
Dividends declared and payable                                     122,467          110,506
Income taxes payable                                                     -            1,168
                                                             -------------    -------------

        TOTAL LIABILITIES                                      198,502,308      189,762,127
                                                             -------------    -------------


COMMITMENTS AND CONTINGENCIES                                            -                -


STOCKHOLDERS' EQUITY
Preferred stock, $.10 par value, 500,000
  shares authorized;  no shares issued or
  outstanding                                                            -                -
Common stock, $.10 par value, 1,500,000
  shares authorized;  1,146,270 issued and outstanding
  at March 31, 2003 and 1,150,106 issued and outstanding
  at  June 30, 2002                                                114,627          115,011
Additional paid-in-capital                                       2,806,627        2,761,251
Unearned ESOP stock                                               (157,871)        (207,926)
Retained earnings, substantially
  restricted                                                    13,282,590       12,420,358
Accumulated other comprehensive
  earnings                                                       1,265,164        1,294,248
                                                             -------------    -------------

        TOTAL STOCKHOLDERS' EQUITY                              17,311,137       16,382,942
                                                             -------------    -------------

        TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY           $ 215,813,445    $ 206,145,069
                                                             =============    =============
</TABLE>

See notes to condensed consolidated financial statements.

                                       3

<PAGE>
                               GFSB Bancorp, Inc.

                  CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
                           AND COMPREHENSIVE EARNINGS

<TABLE>
<CAPTION>
                                                                      Three months ended          Nine months ended
                                                                           March 31,                   March 31,
                                                                   -------------------------   -------------------------
                                                                       2003          2002          2003          2002
                                                                   -----------   -----------   -----------   -----------
                                                                   (Unaudited)   (Unaudited)   (Unaudited)   (Unaudited)
<S>                                                              <C>           <C>           <C>           <C>
Interest income
           Loans receivable
                           Mortgage loans                          $ 2,006,844   $ 2,136,176   $ 6,254,520   $ 6,457,153
                           Commercial loans                            354,295       296,589     1,018,707       973,501
                           Share and consumer loans                    100,988       109,856       320,619       357,511
           Investment and mortgage-backed securities                   526,965       722,954     1,728,783     2,306,366
           Other interest-earning assets                                32,366        34,092       102,349       113,489
                                                                   -----------   -----------   -----------   -----------

                           TOTAL INTEREST EARNINGS                   3,021,458     3,299,667     9,424,978    10,208,020

Interest expense
           Deposits                                                    710,295       905,175     2,262,892     3,263,682
           Advances from Federal Home Loan Bank                        790,859       842,496     2,375,061     2,554,465
           Repurchase agreements                                           160         1,552         3,710        12,787
                                                                   -----------   -----------   -----------   -----------

                           TOTAL INTEREST EXPENSE                    1,501,314     1,749,223     4,641,663     5,830,934
                                                                   -----------   -----------   -----------   -----------

                           NET INTEREST EARNINGS                     1,520,144     1,550,444     4,783,315     4,377,086

Provision for loan losses                                              140,015        70,011       215,015       120,018
                                                                   -----------   -----------   -----------   -----------

                           NET INTEREST EARNINGS AFTER
                             PROVISION FOR LOAN LOSSES               1,380,129     1,480,433     4,568,300     4,257,068
                                                                   -----------   -----------   -----------   -----------

Non-interest earnings
           Income from real estate operations                            1,350         1,350         5,100         2,250
           Miscellaneous income                                         15,663        10,378        39,544        33,088
           Net gains from sales of Available for sale securities             -             -             -        10,000
           Net gains from sales of loans                                52,129        11,444       108,188        28,290
           Service charge income                                       119,096        67,358       310,595       209,099
                                                                   -----------   -----------   -----------   -----------

                           TOTAL NON-INTEREST EARNINGS                 188,238        90,530       463,427       282,727
                                                                   -----------   -----------   -----------   -----------

Non-interest expense
           Compensation and benefits                                   595,937       546,105     1,710,413     1,436,484
           FDIC insurance                                                4,697         4,833        13,624        14,439
           Insurance                                                    13,963        11,445        38,445        29,022
           Stock services                                                6,680         6,548        15,732        22,522
           Occupancy                                                   136,430       111,795       402,050       311,952
           Data processing                                              92,276        92,790       251,211       241,771
           Professional fees                                            39,205        22,185       105,358        89,538
           Advertising                                                  52,313        21,119       124,088        61,480
           Stationary, printing and office supplies                     35,530        22,159       123,258        76,740
           ATM expense                                                   9,312        12,388        40,257        35,067
           Supervisory exam fees                                        14,077        13,568        41,877        41,810
           Postage                                                      18,458        16,130        43,997        44,589
           Other                                                       101,778        80,070       275,178       205,329
                                                                   -----------   -----------   -----------   -----------

                           TOTAL NON-INTEREST EXPENSE                1,120,656       961,135     3,185,488     2,610,743
                                                                   -----------   -----------   -----------   -----------
</TABLE>

                                       4
<PAGE>

                               GFSB Bancorp, Inc.

                  CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
                     AND COMPREHENSIVE EARNINGS - CONTINUED

<TABLE>
<CAPTION>
                                                                Three months ended            Nine months ended
                                                                     March 31,                    March 31,
                                                          ------------------------------   -----------------------
                                                                 2003            2002        2003          2002
                                                          --------------   -------------   ---------   -----------
                                                              (Unaudited)     (Unaudited) (Unaudited)   (Unaudited)
<S>                                                            <C>             <C>       <C>           <C>
                           EARNINGS BEFORE INCOME TAXES          447,711         609,828   1,846,239     1,929,052

Income tax expense
           Currently payable                                     168,135         191,311     629,478       631,625
                                                          --------------   -------------   ---------   -----------

                                                                 168,135         191,311     629,478       631,625
                                                          --------------   -------------   ---------   -----------

                           NET EARNINGS                   $      279,576   $     418,517   1,216,761   $ 1,297,427
                                                          ==============   =============   =========   ===========



Other Comprehensive Earnings
           Unrealized (loss), net of tax                         (85,190)       (171,117)    (29,084)     (135,439)

                                                          --------------   -------------   ---------   -----------
                           COMPREHENSIVE EARNINGS                194,386         247,400   1,187,677     1,161,988
                                                          ==============   =============   =========   ===========


Earnings per common share
           Basic                                          $         0.25            0.38        1.09          1.18
                                                          ==============   =============   =========   ===========

Weighted average number of common shares outstanding
           Basic                                               1,116,925       1,106,475   1,113,390     1,103,553
                                                          ==============   =============   =========   ===========

Earnings per common share
           Diluted                                                  0.24            0.37        1.05          1.13
                                                          ==============   =============   =========   ===========

Weighted average number of common shares outstanding
           Diluted                                             1,164,785       1,146,377   1,158,911     1,143,355
                                                          ==============   =============   =========   ===========


Comprehensive earnings per common share
           Basic                                                    0.17            0.22        1.07          1.05
                                                          ==============   =============   =========   ===========

           Diluted                                                  0.17            0.22        1.02          1.02
                                                          ==============   =============   =========   ===========


Dividends per share                                                 0.11            0.10        0.32          0.29
                                                          ==============   =============   =========   ===========
</TABLE>

See notes to condensed consolidated financial statements.

                                        5
<PAGE>
                               GFSB Bancorp, Inc.

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                Increase (decrease) in cash and cash equivalents

<TABLE>
<CAPTION>
                                                                                  Nine Months Ended
                                                                                      March 31,
                                                                            ----------------------------
                                                                                2003            2002
                                                                            ------------    ------------
                                                                              (Unaudited)     (Unaudited)
<S>                                                                       <C>             <C>
Cash flows from operating activities
           Net earnings                                                     $  1,216,761    $  1,297,427
           Adjustments to reconcile net earnings to
             net cash provided by operations
                     Deferred loan origination fees                             (220,607)       (329,372)
                     Gain on sale of loans and securities                       (108,188)        (38,290)
                     Provision for loan losses                                   215,015         120,018
                     Depreciation of premises and equipment                      218,734         141,219
                     Amortization of investment and mortgage-
                       backed securities premiums                                116,885         121,727
                     Stock dividends on FHLB stock                               (87,500)        (90,300)
                     Release of ESOP stock                                       148,525         121,237
                     Stock compensation under management bonus stock plan         23,060          12,488
                     Stock compensation resulting from stock purchased by
                       the Company within six months of exercise of
                       related options                                            16,920          57,442

           Net changes in operating assets and liabilities
                     Accrued interest and dividends receivable                   101,087          36,375
                     Prepaid and other assets                                    (28,990)        (60,495)
                     Income taxes receivable                                     (14,173)              -
                     Accrued interest payable                                     58,988          (2,422)
                     Accounts payable and accrued liabilities                    133,531          95,701
                     Income taxes payable                                         (1,168)       (194,686)
                     Dividends declared and payable                               11,961          12,053
                                                                            ------------    ------------
                               Net cash provided by
                               operating activities                            1,800,841       1,300,122
                                                                            ------------    ------------
Cash flows from investing activities
           Purchase of premises and equipment                                    (95,114)     (1,310,713)
           Loan originations and principal
             repayment on loans, net                                          (2,211,905)     (3,696,880)
           Principal payments on mortgage-backed
             securities                                                        7,905,784       7,951,455
           Purchases of mortgage-backed securities                           (14,408,091)     (5,130,469)
           Purchases of available-for-sale securities                         (7,088,496)     (6,167,537)
           Maturities and proceeds from sale of
             available-for-sale securities                                     1,668,000       1,310,000
           Principal payments on available-for-sale securities                 4,719,479       1,808,947
           Purchases of hold-to-maturity securities                             (270,000)              -
           Principal payments on hold-to-maturity securities                       4,000          25,000
           Purchase of FHLB stock                                                      -        (447,900)
                                                                            ------------    ------------
                               Net cash used by
                               investing activities                           (9,776,343)     (5,658,097)
                                                                            ------------    ------------
</TABLE>

                                        6
<PAGE>

                               GFSB Bancorp, Inc.

           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED

                Increase (decrease) in cash and cash equivalents

<TABLE>
<CAPTION>
                                                                            Nine Months Ended
                                                                                  March 31,
                                                                       ------------------------------
                                                                            2003             2002
                                                                       -------------    -------------
                                                                          (Unaudited)      (Unaudited)
<S>                                                                  <C>              <C>
Cash flows from financing activities
           Net increase (decrease) in transaction accounts, passbook
             savings, money market accounts, and
             certificates of deposit                                   $  10,110,496    $  (4,418,004)
           Repurchase agreements                                            (462,464)         (27,921)
           Net increase in mortgage escrow funds                             198,950          199,018
           Proceeds from FHLB advances                                   726,298,387      466,809,462
           Repayments on FHLB advances                                  (727,616,577)    (457,298,852)
           Purchase of GFSB Bancorp stock under the
             stock repurchase plan in cash                                  (112,624)        (136,526)
           Dividends paid or to be paid in cash                             (354,530)        (333,530)
           Price paid for vested management bonus
              stock plan stock                                                11,100           16,650
           Proceeds from exercise of stock options                            31,125           79,084
                                                                       -------------    -------------

                               Net cash provided by
                               financing activities                        8,103,863        4,889,381
                                                                       -------------    -------------

           Increase in cash and cash equivalents                             128,361          531,406

           Cash and cash equivalents at beginning of period                5,651,491        4,262,254
                                                                       -------------    -------------

           Cash and cash equivalents at end of period                  $   5,779,852        4,793,660
                                                                       =============    =============


Supplemental disclosures of cash flow information
           Cash paid during the period for
                     Interest on deposits and advances                 $   4,582,675    $   5,833,356
                     Income taxes                                            644,100          801,111

           Change in unrealized gain, net of deferred
             taxes on available-for-sale securities                          (29,084)        (135,439)

           Dividends declared not yet paid                                   122,467          110,506
</TABLE>

See notes to condensed consolidated financial statements.

                                        7
<PAGE>

                               GFSB BANCORP, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (unaudited)

         1.  The  accompanying   unaudited  condensed   consolidated   financial
statements were in accordance with instructions for Form 10-QSB and therefore do
not  include  all  disclosure  necessary  for a  complete  presentation  of  the
consolidated  financial  statements in  conformity  with  accounting  principles
generally  accepted in the United States of America.  However,  all adjustments,
which are, in the opinion of management,  necessary for the fair presentation of
the interim financial statements have been included. All such adjustments are of
a normal recurring nature. The condensed consolidated statements of earnings and
comprehensive  earnings are not necessarily  indicative of results, which may be
expected for the entire year, or for any other interim period.

Certain information and footnote  disclosures normally included in the financial
statements prepared in accordance with accounting  principles generally accepted
in the United States of America have been  condensed or omitted  pursuant to the
rules and regulations of the Securities and Exchange Commission. It is suggested
that these condensed unaudited financial  statements be read in conjunction with
the Form 10-KSB for the year ended June 30, 2002.

                                       8
<PAGE>

Item 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

General

The  Private  Securities  Litigation  Reform Act of 1995  contains  safe  harbor
provisions regarding forward-looking  statements.  When used in this discussion,
the words  "believes",  "anticipates",  "contemplates",  "expects",  and similar
expressions are intended to identify forward-looking statements. Such statements
are subject to certain risks and uncertainties  which could cause actual results
to differ materially from those projected. Those risks and uncertainties include
changes in interest  rates,  risks  associated with the ability to control costs
and  expenses,  general  economic  conditions.  We  undertake no  obligation  to
publicly  release  the  results  of  any  revisions  to  those  forward  looking
statements which may be made to reflect events or  circumstances  after the date
hereof or to reflect the occurrence of unanticipated events.

Overview

GFSB  Bancorp,  Inc.  is a savings and loan  holding  company  headquartered  in
Gallup,  New Mexico,  which  provides a full range of deposits  and  traditional
mortgage  loan  products  through its wholly owned  banking  subsidiary,  Gallup
Federal Savings Bank. All references  refer  collectively to the Company and the
Bank, unless the context indicates otherwise.

                                       9

<PAGE>

RESULTS OF OPERATIONS

COMPARISON  OF OPERATING  RESULTS FOR QUARTER  ENDED MARCH 31, 2003  COMPARED TO
QUARTER ENDED MARCH 31, 2002.

General

Net earnings for the quarter ended March 31, 2003 decreased $139,000 to $280,000
from $419,000 for the quarter ended March 31, 2002. The decrease in net earnings
is  primarily  attributable  to a $70,000  increase  in the  provision  for loan
losses,  a $160,000  increase in non-interest  expense and a $30,000 decrease in
net interest  earnings  partially  offset by a $98,000  increase in non-interest
earnings and a $23,000 decrease in income tax expense.  Please refer to "Average
Balance Sheets" for an analysis of the changes in net interest  earnings for the
quarter ended March 31, 2003 compared to the same 2002 period.

Average Balance Sheets

The  following  table sets forth certain  information  relating to the Company's
average  balance sheet and reflects the average yield on assets and average cost
of  liabilities  for the periods  indicated and the average annual yields earned
and rates paid. Average balances are derived from month-end balances. Management
does not believe that the use of  month-end  balances  instead of daily  average
balances has caused any material differences in the information presented.

<TABLE>
<CAPTION>
                                    Quarter ended March 31, 2003                 Quarter ended March 31, 2002
                                    ----------------------------                 ----------------------------
                                    Average                      Average         Average                       Average
                                    Balance      Interest       Yield/Cost       Balance       Interest       Yield/Cost
                                    -------      --------       ----------       -------       --------       ----------
                                   (Dollars in Thousands)                        (Dollars in Thousands)
<S>                              <C>             <C>            <C>         <C>              <C>              <C>
Interest-earning assets:
Loans receivable (1)               $142,246        $2,462           6.92%       $133,371         $2,543           7.63%
Investment securities and
 mortgage-backed securities          55,686           527           3.78%         56,817            723           5.09%
Other interest-earning
  assets (2)                          5,110            32           2.50%          4,889             33           2.70%
                                   --------        ------                       --------         ------

Total interest-earning assets       203,042         3,021           5.95%        195,077          3,299           6.32%
                                                   ------                                        ------
Non-interest-earning assets           9,158                                        7,480
                                   --------                                     --------

Total assets                       $212,200                                     $202,557
                                   ========                                     ========


Interest-bearing liabilities:
  Transaction accounts              $ 8,673          $ 16           .74%        $ 8,205          $ 16             .78%
  Passbook savings                    4,721            15          1.27%          4,753            15            1.26%
  Money market accounts              10,309            27          1.05%         10,645            32            1.20%
  Certificates of deposit            76,666           652          3.40%         74,428           842            4.53%
  Other liabilities (3)              80,417           791          3.93%         77,900           844            4.33%
                                   --------        ------                       --------         ----
Total interest-bearing
   liabilities                      180,786         1,501          3.32%        175,931         1,749            3.98%
                                                    -----                                       -----
Non-interest bearing
   liabilities                       14,096                                      10,692
                                   --------                                     -------

Total liabilities                   194,882                                     186,623

Stockholders' equity                 17,318                                      15,934
                                   --------                                     -------

Total liabilities and
  stockholders' equity             $212,200                                    $202,557
                                   ========                                    ========

Net interest earnings                              $1,520                                      $1,550
                                                   ======                                      ======
Interest rate spread (4)                                           2.63%                                         2.34%
                                                                   ====                                          ====

Net yield on interest-                                             2.99%                                         3.18%
  earning assets (5)                                               ====                                          ====

Ratio of average interest-
Earning assets to average
interest-bearing  liabilities                                      1.12X                                         1.11X
                                                                   ====                                          ====
</TABLE>

(1)  Average balances include non-accrual loans.
(2)  Includes interest-bearing deposits in other financial institutions.
(3)  Other liabilities include FHLB advances and Repurchase agreements.
(4)  Interest-rate spread represents the difference between the average yield on
     interest-earning   assets  and  the   average   cost  of   interest-bearing
     liabilities.
(5)  Net yield on interest - earning assets  represents net interest income as a
     percentage of average interest-earning assets.

                                       10
<PAGE>

Rate/Volume Analysis

The table below sets forth  certain  information  regarding  changes in interest
income and interest expense of the Company for the periods  indicated.  For each

category   of   interest-earning   assets  and   interest-bearing   liabilities,
information is provided on changes  attributable to (i) changes in volume;  (ii)
changes in rates; (iii) changes in rate-volume.  The changes attributable to the
combined  impact of volume and rate have been allocated  proportionately  to the
changes due to volume and the changes due to rate.

                                           Quarter ended March 31, 2003 vs. 2002
                                                    Increase (Decrease)
                                                          Due to
                                             ---------------------------------
                                                               Rate/
                                             Volume     Rate   Volume      Net
                                             ------     ----   ------      ---
                                                   (Dollars in Thousands)
Interest income:
  Loans receivable                            $ 169    $(237)   $ (13)   $ (81)
  Mortgage-backed securities and
     investment securities                      (14)    (186)       4     (196)
  Other interest-earning  assets                  1       (2)       -       (1)
                                              -----    -----    -----    -----
    Total interest-earning assets               156     (425)      (9)    (278)
                                              -----    -----    -----    -----
Interest expense:

  Transaction accounts                            1       (1)       -        -
  Savings accounts                               (1)       1        -        -
  Money markets                                  (1)      (4)       -       (5)
  Certificates of deposit                        25     (210)      (5)    (190)
  Other liabilities                              27      (78)      (2)     (53)
                                              -----    -----    -----    -----

   Total interest-bearing liabilities            51     (292)      (7)    (248)
                                              -----    -----    -----    -----

Net change in interest earnings               $ 105    $(133)   $  (2)   $ (30)
                                              =====    =====    =====    =====

Provision for Losses on Loans

The Company  maintains  an  allowance  for loan losses  based upon  management's
periodic evaluation of known and inherent risks in the loan portfolio, past loss
experience,  adverse  situations that may affect the borrower's ability to repay
loans,  estimated  value of the  underlying  collateral and current and expected
market conditions.  The provision for loan loss was $140,000 and $70,000 for the
periods  ended  March  31,  2003 and 2002,  respectively.  The  increase  in the
provision for loan losses for the current  three-month  period was primarily the
result of an increase in loans  classified  as  substandard  from  $2,018,000 to
$3,528,000, which was primarily the result of deterioration in credit quality of
one very large  commercial  real estate loan and one  smaller  commercial  loan.
While the  Company  maintains  its  allowance  for  losses  at a level  which it
considers to be adequate,  there can be no assurance that further additions will
not be made to the loss  allowances  and that such  losses  will not  exceed the
estimated amounts.

                                       11
<PAGE>

Non-Interest Earnings

Total  non-interest  earnings  increased  by $98,000 or 108% to $188,000 for the
quarter  ended March 31, 2003 from $90,000 for the quarter ended March 31, 2002.
This  increase  was  primarily  due to an increase in service  charge  income of
$52,000, an increase in net gains from sales of loans of $41,000 and an increase
in  miscellaneous  income of $5,000.  The increase in service  charge  income is
primarily  due to  increased  insufficient  fee  charges  collected  on NOW  and
checking  accounts.  The increase in miscellaneous  income is primarily due to a
$5,000 gain on the sale of other real estate owned.

Non-Interest Expense

Total  non-interest  expense  increased  $160,000 or 17% to  $1,121,000  for the
quarter ended March 31, 2003 from $961,000 for the quarter ended March 31, 2002.
The increase in non-interest expense was primarily  attributable to increases in
compensation and benefits,  occupancy  costs,  advertising,  professional  fees,
stationary,  printing and office  supplies,  and other operating  expenses.  The
$50,000 increase in compensation and benefits expense for the period ended March
31, 2003 is primarily attributable to a $76,000 increase in general salaries and
benefits  expense  due to the  hiring  of nine  employees  to staff  the  Bank's
Farmington  branch,  and  $32,000  in expense  associated  with  employee  stock
compensation  plans,  offset  in part  by  $57,000  in  expense  related  to the
Company's  repurchase  of stock for the same period in 2002 in  connection  with
employee  compensation  plans.  Occupancy costs increased $25,000 for the period
ended March 31, 2003 primarily due to increases in  depreciation  for furniture,
fixtures, and equipment,  maintenance contract expense and other occupancy costs
associated with operating the new branch.  Advertising expense increased $31,000
primarily due to the Bank's  efforts to achieve  growth in the  Farmington,  New
Mexico  market,  where the new branch is located.  Professional  fees  increased
$17,000  primarily  due to higher  audit  expense  and  accounting  fees for the
quarter ended March 31, 2003. Stationary, printing and office supplies increased
$13,000  primarily due to the purchase of forms and supplies for the new branch.
Other  operating  expenses  increased  $22,000,  primarily  due to  higher  loan
expense, other real estate owned expense, correspondent bank expense and armored
transit expense in the quarter ended March 31, 2003.

                                       12

<PAGE>

RESULTS OF OPERATIONS

COMPARISON OF OPERATING  RESULTS FOR THE NINE-MONTH  PERIOD ENDED MARCH 31, 2003
COMPARED TO THE NINE-MONTH PERIOD ENDED MARCH 31, 2002.

General

Net  earnings  for the nine months  ended March 31,  2003  decreased  $80,000 to
$1,217,000 compared to net earnings of $1,297,000 for the comparable  nine-month
period in 2002.  The  decrease in net  earnings  was  primarily  the result of a
$95,000  increase in the  provision  for loan losses and a $575,000  increase in
non-interest  expense  partially  offset by a $406,000  increase in net interest
earnings  and a $181,000  increase in  non-interest  earnings.  Please  refer to
"Average Balance Sheets" for an analysis of the change in net interest  earnings
for the nine months ended March 31, 2003 compared to the same 2002 period.

Average Balance Sheets

The  following  table sets forth certain  information  relating to the Company's
average  balance sheet and reflects the average yield on assets and average cost
of liabilities for the periods indicated and the average yields earned and rates
paid. Average balances are derived from month-end balances.  Management does not
believe that the use of month-end balances instead of daily average balances has
caused any material differences in the information presented.

<TABLE>
<CAPTION>
                                          Nine-month period ended                      Nine-month period ended
                                               March 31, 2003                               March 31, 2002
                                               --------------                               --------------
                                    Average                      Average       Average                       Average
                                    Balance      Interest       Yield/Cost     Balance      Interest        Yield/Cost
                                    -------      --------       ----------     -------      --------        ----------
                                 (Dollars in Thousands)                       (Dollars in Thousands)
<S>                              <C>             <C>              <C>        <C>              <C>             <C>
Interest-earning assets:
Loans receivable (1)               $141,191        $7,594           7.17%     $131,100        $7,788            7.92%
Investment securities and
 Mortgage-backed securities          53,547         1,729           4.31%       57,271         2,306            5.37%
Other interest-earning
  assets (2)                          5,192           102           2.62%        3,776           113            3.99%
                                   --------        ------                     --------        ------

Total interest-earning assets       199,930         9,425           6.28%      192,147        10,207            7.05%
Non-interest-earning assets           8,997                                      7,594
                                   --------                                   --------

Total assets                       $208,927                                   $199,741
                                 ===========                                  ========
Interest-bearing liabilities:
  Transaction accounts              $ 8,678        $   52            .80%      $ 7,901        $   59            1.00%
  Passbook savings                    5,781            48           1.11%        4,640            44            1.26%
  Money market accounts              11,648           105           1.20%       10,066           127            1.68%
  Certificates of deposit            74,838         2,058           3.67%       76,639         3,033            5.28%
  Other liabilities (3)              76,216         2,379           4.16%       74,085         2,567            4.62%
                                    -------        ------                      -------         -----
Total interest-bearing
   liabilities                      177,161         4,642           3.49%      173,331         5,830            4.48%

Non-interest bearing
   liabilities                       14,746                                     10,773
                                   --------                                   --------

Total liabilities                   191,907                                    184,104

Stockholders' equity                 17,020                                     15,637
                                   --------                                   --------

Total liabilities and
  Stockholders' equity             $208,927                                   $199,741
                                   ========                                   ========

Net interest income                                $4,783                                     $4,377
                                                   ======                                     ======
Interest rate spread (4)                                            2.79%                                       2.57%
                                                                    ====                                        ====
Net yield on interest-
  earning  assets (5)                                               3.19%                                       3.04%
                                                                    ====                                        ====
Ratio of average interest-
  earning assets to average
interest-bearing  liabilities                                       1.13X                                       1.11X
                                                                    ====                                        ====
</TABLE>

(1)  Average balances include non-accrual loans.
(2)  Includes interest-bearing deposits in other financial institutions
(3)  Other liabilities include FHLB advances and Repurchase agreements
(4)  Interest-rate spread represents the difference between the average yield on
     interest-earning   assets  and  the   average   cost  of   interest-bearing
     liabilities.
(5)  Net yield on interest - earning assets  represents net interest income as a
     percentage of average interest-earning assets.

                                       13
<PAGE>

Rate/Volume Analysis

The table below sets forth  certain  information  regarding  changes in interest
income and interest expense of the Company for the periods  indicated.  For each
category   of   interest-earning   assets  and   interest-bearing   liabilities,
information is provided on changes  attributable to (i) changes in volume;  (ii)
changes in rates; (iii) changes in rate-volume.  The changes attributable to the
combined  impact of volume and rate have been allocated  proportionately  to the
changes due to volume and the changes due to rate.

<TABLE>
<CAPTION>
                                                        Nine-month period ended
                                                        March 31, 2003 vs. 2002
                                                          Increase (Decrease)
                                                               Due to
                                               ----------------------------------------
                                                                       Rate/
                                                 Volume      Rate      Volume       Net
                                                 ------      ----      ------       ---
                                                         (Dollars in Thousands)
Interest income:
<S>                                            <C>        <C>        <C>        <C>
  Loans receivable                             $   599    $  (737)   $   (56)   $  (194)
  Mortgage-backed securities and
     investment securities                        (150)      (455)        28       (577)
  Other interest-earning  assets                    42        (39)       (14)       (11)
                                               -------    -------    -------    -------
    Total interest-earning assets                  491     (1,231)       (42)      (782)
                                               -------    -------    -------    -------

Interest expense:

  Transaction accounts                               6        (12)        (1)        (7)
  Savings accounts                                  11         (5)        (2)         4
  Money markets                                     20        (36)        (6)       (22)
  Certificates of deposit                          (71)      (925)        21       (975)
  Other liabilities                                 74       (256)        (6)      (188)
                                               -------    -------    -------    -------
   Total interest-bearing liabilities               40     (1,234)         6     (1,188)
                                               -------    -------    -------    -------

Net change in interest earnings                $   451    $     3    $   (48)   $   406
                                               =======    =======    =======    =======
</TABLE>

Provision for Losses on Loans

The Company  maintains  an  allowance  for loan losses  based upon  management's
periodic evaluation of known and inherent risks in the loan portfolio, past loss
experience,  adverse  situations that may affect the borrower's ability to repay
loans,  estimated  value of the  underlying  collateral and current and expected
market conditions. The provision for loan loss was $215,000 and $120,000 for the
nine-month period ended March 31, 2003 and 2002,  respectively.  See "Comparison
of Operating  Results for the quarter  ended March 31, 2003  compared to quarter
ended March 31, 2002 - Provision for Losses on Loans."

                                       14
<PAGE>

Non-Interest Earnings

Total  non-interest  earnings  increased  by $181,000 or 64% to $464,000 for the
nine months  ended March 31, 2003 from  $283,000 for the nine months ended March
31, 2002.  This  increase  was  primarily  due to an increase in service  charge
income of $101,000, an increase in net gains from sales of loans of $80,000, and
a $6,000 increase in miscellaneous income partially offset by a $10,000 decrease
in net gains  from  sales of  available-for-sale  securities.  The  increase  in
service  charge  income is primarily due to increased  insufficient  fee charges
collected on NOW and checking accounts.  The increase in miscellaneous income is
primarily due to a $5,000 gain on the sale of other real estate owned.

Non-Interest Expense

Total non-interest  expense increased $575,000 or 22% to $3,186,000 for the nine
months ended March 31, 2003 from  $2,611,000 for the nine months ended March 31,
2002.  The  increase in  non-interest  expense  was  primarily  attributable  to
increases  in  compensation   and  benefits,   occupancy   costs,   advertising,
stationary,  printing and office supplies,  professional  fees, data processing,
insurance and other operating expenses,  offset by a decrease in stock services.
The $274,000  increase in compensation  and benefits  expense for the nine month
period ended March 31, 2003 is primarily  attributable to a $260,000 increase in
general  salaries  and  benefits  expense  associated  with the  hiring  of nine
employees to staff the Bank's Farmington  branch,  $16,000 in expense related to
director fee compensation and $56,000 in expense  associated with employee stock
compensation  plans,  offset  in part  by  $57,000  in  expense  related  to the
Company's  repurchase  of stock for the same period in 2002 in  connection  with
employee  stock  compensation  plans.  Occupancy  costs  increased  $90,000  due
primarily to increases in depreciation for furniture,  fixtures,  and equipment,
maintenance contract expense and other occupancy costs associated with operating
the new branch.  Advertising  expense  increased  $62,000  primarily  due to the
Bank's efforts to achieve growth in the Farmington, New Mexico market, where the
new  branch is  located.  Stationary,  printing  and office  supplies  increased
$46,000  primarily due to the purchase of forms and supplies for the new branch.
Professional fees increased  $16,000 primarily due to higher audit expense,  and
accounting  fees. Data processing  increased $9,000 primarily due to an increase
in expenses resulting from the processing cost associated with the growth in the
volume of deposit and loan accounts,  statement processing and transaction items
being  serviced.  Insurance  expense  increased  $9,000  due to an  increase  in
insurance premiums. Other operating expenses increased $70,000, due primarily to
higher  loan  expense,  other real  estate  owned  expense,  correspondent  bank
expense, armored transit expense and telephone expense for the nine months ended
March 31, 2003. The $7,000  decrease in stock services for 2002 is primarily due
to the  absence  of a $7,400  regulatory  filing fee paid to the OTS in the nine
months ended March 31, 2002.


Item 3.  CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures.  Based on their evaluation
     -----------------------------------------------
as of a date within 90 days of the filing date of this Quarterly  Report on Form
10-QSB,  the Registrant's  principal  executive officer and principal  financial
officer have concluded that the Registrant's  disclosure controls and procedures
(as defined in Rules 13a-14(c) and 15d-14(c)  under the Securities  Exchange Act
of 1934 (the "Exchange Act")) are effective to ensure that information  required
to be  disclosed  by the Company in reports  that it files or submits  under the
Exchange Act is recorded,  processed,  summarized  and reported  within the time
periods specified in Securities and Exchange Commission rules and forms.

(b)  Changes in  internal  controls.  There were no  significant  changes in the
     ------------------------------
Registrant's  internal  controls or in other  factors  that could  significantly
affect these controls subsequent to the date of their evaluation,  including any
corrective  actions  with  regard  to  significant   deficiencies  and  material
weaknesses.

                                       15
<PAGE>

PART II.  OTHER INFORMATION
--------  -----------------


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

                  Not applicable.

Item 2.  Changes in Securities and Use of Proceeds
         -----------------------------------------

                  Not applicable.

Item 3.  Defaults Upon Senior Securities
         -------------------------------

                  Not applicable.

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

                  Not applicable.

Item 5.  Other Information
         -----------------

                  Not applicable.

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

          (a)  List of Exhibits

               3.1     Certificate of Incorporation of GFSB Bancorp, Inc.*
               3.2     Bylaws of GFSB Bancorp, Inc.*
               10.1    1995 Stock Option Plan**
               10.2    Management Stock Bonus Plan**
               10.3    Form of Directors Deferred Compensation Agreement between
                       the Bank and Directors***
               10.4    Form of Directors Stock Compensation Plan between the
                       Company and Directors of the Company***
               10.5    2000 Stock Option Plan****
               99.0    Certification pursuant to 18 U.S.C. Section 1350,
                       as adopted pursuant to Section 906 of the
                       Sarbanes-Oxley Act of 2002

         --------------
         *        Incorporated herein by reference to exhibits  3(i)(Certificate
                  of  Incorporation)   and  3(ii)(Bylaws)  to  the  Registration
                  Statement on Form S-1 of the  Registrant  (File No.  33-90400)
                  initially filed with the Commission on March 17, 1995.

         **       Incorporated by reference to the identically numbered exhibits
                  of the Annual  Report on Form 10-KSB for the fiscal year ended
                  June 30, 1997 (File No. 0-25854) filed with the SEC.

         ***      Incorporated by reference to the identically numbered exhibits
                  of the  Quarterly  Report on Form 10-QSB for the quarter ended
                  March 31, 2000 filed with the SEC.

         ****     Incorporated  by  reference  to the  Proxy  Statement  for the
                  Annual Meeting of  Stockholders  on October 27, 2000 and filed
                  with the SEC on September 25, 2000.

(b) Not applicable.
                                       16
<PAGE>

SIGNATURES

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                 GFSB BANCORP, INC.


Date:  May 12, 2003              /s/Jerry R. Spurlin
                                 -----------------------------------------------
                                 Jerry R. Spurlin
                                 Assistant Secretary and Chief Financial Officer
                                 (Duly Authorized Representative and
                                 Principal Financial Officer)

                                       17
<PAGE>

                            SECTION 302 CERTIFICATION


         I, Richard C. Kauzlaric, certify that:

1.       I have reviewed this  quarterly  report on Form 10-QSB of GFSB Bancorp,
         Inc.:

2.       Based on my  knowledge,  this  quarterly  report  does not  contain any
         untrue  statement of a material  fact or omit to state a material  fact
         necessary to make the  statements  made, in light of the  circumstances
         under which such  statements  were made, not misleading with respect to
         the period covered by this quarterly report;

3.       Based on my knowledge,  the financial  statements,  and other financial
         information  included in this quarterly  report,  fairly present in all
         material  respects the financial  condition,  results of operations and
         cash flows of the  registrant as of, and for, the periods  presented in
         this quarterly report;

4.       The  registrant's  other  certifying  officer and I are responsible for
         establishing  and  maintaining  disclosure  controls and procedures (as
         defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
         we have:

         (a)      designed  such  disclosure  controls and  procedures to ensure
                  that  material   information   relating  to  the   registrant,
                  including its consolidated  subsidiaries,  is made known to us
                  by others  within  those  entities,  particularly  during  the
                  period in which this quarterly report is being prepared;

         (b)      evaluated the  effectiveness  of the  registrant's  disclosure
                  controls and  procedures  as of a date within 90 days prior to
                  the filing  date of this  quarterly  report  (the  "Evaluation
                  Date"); and

         (c)      presented in this quarterly  report our conclusions  about the
                  effectiveness of the disclosure  controls and procedures based
                  on our evaluation as of the Evaluation Date;

5.       The registrant's other certifying  officer and I have disclosed,  based
         on our most recent  evaluation,  to the  registrant's  auditors and the
         audit  committee  of  registrant's   board  of  directors  (or  persons
         performing the equivalent functions):

         (a)      all  significant  deficiencies  in the design or  operation of
                  internal   controls   which   could   adversely   affect   the
                  registrant's ability to record, process,  summarize and report
                  financial  data  and  have  identified  for  the  registrant's
                  auditors any material weaknesses in internal controls; and

         (b)      any fraud,  whether or not material,  that involves management
                  or  other  employees  who  have  a  significant  role  in  the
                  registrant's internal controls; and

6.       The registrant's  other certifying officer and I have indicated in this
         quarterly  report  whether there were  significant  changes in internal
         controls or in other factors that could  significantly  affect internal
         controls  subsequent  to  the  date  of  our  most  recent  evaluation,
         including   any   corrective   actions   with  regard  to   significant
         deficiencies and material weaknesses.



Date:  May 12, 2003                 /s/Richard C. Kauzlaric
       ------------                 ---------------------------
                                    Richard C. Kauzlaric
                                    President
<PAGE>

                            SECTION 302 CERTIFICATION


         I, Jerry R. Spurlin, certify that:

1.       I have reviewed this  quarterly  report on Form 10-QSB of GFSB Bancorp,
         Inc.:

2.       Based on my  knowledge,  this  quarterly  report  does not  contain any
         untrue  statement of a material  fact or omit to state a material  fact
         necessary to make the  statements  made, in light of the  circumstances
         under which such  statements  were made, not misleading with respect to
         the period covered by this quarterly report;

3.       Based on my knowledge,  the financial  statements,  and other financial
         information  included in this quarterly  report,  fairly present in all
         material  respects the financial  condition,  results of operations and
         cash flows of the  registrant as of, and for, the periods  presented in
         this quarterly report;

4.       The  registrant's  other  certifying  officer and I are responsible for
         establishing  and  maintaining  disclosure  controls and procedures (as
         defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
         we have:

         (a)      designed  such  disclosure  controls and  procedures to ensure
                  that  material   information   relating  to  the   registrant,
                  including its consolidated  subsidiaries,  is made known to us
                  by others  within  those  entities,  particularly  during  the
                  period in which this quarterly report is being prepared;

         (b)      evaluated the  effectiveness  of the  registrant's  disclosure
                  controls and  procedures  as of a date within 90 days prior to
                  the filing  date of this  quarterly  report  (the  "Evaluation
                  Date"); and

         (c)      presented in this quarterly  report our conclusions  about the
                  effectiveness of the disclosure  controls and procedures based
                  on our evaluation as of the Evaluation Date;

5.       The registrant's other certifying  officer and I have disclosed,  based
         on our most recent  evaluation,  to the  registrant's  auditors and the
         audit  committee  of  registrant's   board  of  directors  (or  persons
         performing the equivalent functions):

         (a)      all  significant  deficiencies  in the design or  operation of
                  internal   controls   which   could   adversely   affect   the
                  registrant's ability to record, process,  summarize and report
                  financial  data  and  have  identified  for  the  registrant's
                  auditors any material weaknesses in internal controls; and

         (b)      any fraud,  whether or not material,  that involves management
                  or  other  employees  who  have  a  significant  role  in  the
                  registrant's internal controls; and

6.       The registrant's  other certifying officer and I have indicated in this
         quarterly  report  whether there were  significant  changes in internal
         controls or in other factors that could  significantly  affect internal
         controls  subsequent  to  the  date  of  our  most  recent  evaluation,
         including   any   corrective   actions   with  regard  to   significant
         deficiencies and material weaknesses.



Date:  May 12, 2003                       /s/Jerry R. Spurlin
       ------------                       --------------------------------------
                                          Jerry R. Spurlin
                                          Chief Financial Officer