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, 2001
                                                 --------------

                                       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                                                         04-2095007
--------------------------------------------                --------------------
(State or Other Jurisdiction of Incorporation                (I.R.S. Employer
or Organization)                                            Identification No.)

221 West Aztec Avenue, Gallup, New Mexico                          87301
-----------------------------------------                   --------------------
(Address of Principal Executive Offices)                         (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 April 27, 2001, there were issued and outstanding  1,150,106 shares of the
registrant's Common Stock.

<PAGE>

                               GFSB Bancorp, Inc.


                                      Index

                                                                        Page No.
                                                                        --------

                          PART I. FINANCIAL INFORMATION

Item 1.      Consolidated Financial Statements:

             Consolidated Statements of Financial Condition
                 March 31, 2001 and June 30, 2000                              3

             Consolidated Statements of Earnings and Comprehensive Earnings
                 Three months and nine months ended March 31, 2001 and 2000    4

             Consolidated Statements of Cash Flows
                 Nine months ended March 31, 2001 and 2000                     6

             Notes to Consolidated Financial Statements                        8

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

                           PART II. OTHER INFORMATION

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

             Signatures                                                       18


                                       2

<PAGE>

                               GFSB Bancorp, Inc.

                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

<TABLE>
<CAPTION>
                                                               March 31,         June 30,
                                                                 2001              2000
                                                             -------------    -------------
                                                              (Unaudited)
                                     ASSETS
<S>                                                        <C>              <C>
Cash and due from banks                                      $   2,841,356    $   2,875,537
Interest-bearing deposits with banks                               953,357        1,215,428
Available-for-sale investment securities                        23,196,001       25,438,540
Available-for-sale mortgage-backed securities                   28,481,143       28,930,510
Held-to-maturity investment securities                           1,944,596        1,681,310
Stock of Federal Home Loan Bank, at cost, restricted             4,611,400        4,206,900
Loans receivable, net, substantially pledged                   127,753,897      109,777,269
Accrued interest and dividends receivable                        1,139,506        1,033,974
Premises and equipment                                           1,236,130        1,296,048
Other real estate and repossessed property                           7,950           38,000
Prepaid and other assets                                            81,193          197,883
Deferred tax asset                                                  94,517           94,517
                                                             -------------    -------------
         TOTAL ASSETS                                        $ 192,341,046      176,785,916
                                                             =============    =============

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Transaction and NOW accounts                                 $  14,420,711    $  12,409,069
Savings and MMDA deposits                                       14,779,029       14,801,893
Time deposits                                                   73,712,595       52,736,983
Advances from Federal Home Loan Bank                            71,154,436       82,935,066
Accrued interest payable                                           431,164          288,350
Advances from borrowers for taxes and insurance                    632,416          305,909
Accounts payable and accrued liabilities                           317,249          236,070
Repurchase agreements                                            1,378,474          230,839
Deferred income taxes                                              660,317           67,157
Dividends declared and payable                                      98,453           88,875
Income taxes payable                                               182,605             --
                                                             -------------    -------------
         TOTAL LIABILITIES                                     177,767,449      164,100,211


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;  1,150,106 issued and outstanding
  at March 31,2001 and 940,963 shares issued and
  outstanding at June 30, 2000                                     115,011           94,096
Additional paid-in-capital                                       2,612,526        2,810,626
Unearned ESOP stock                                               (286,597)        (323,911)
Retained earnings, substantially
  restricted                                                    10,850,865        9,974,531
Accumulated other comprehensive
  earnings                                                       1,281,792          130,363
                                                             -------------    -------------
         TOTAL STOCKHOLDERS' EQUITY                             14,573,597       12,685,705
                                                             -------------    -------------
         TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY          $ 192,341,046    $ 176,785,916
                                                             =============    =============
</TABLE>

See notes to consolidated financial statements.

                                       3
<PAGE>
                               GFSB Bancorp, Inc.
                       CONSOLIDATED STATEMENTS OF EARNINGS
                           AND COMPREHENSIVE EARNINGS

<TABLE>
<CAPTION>
                                                        Three months ended           Nine months ended
                                                            March 31,                     March 31,
                                                 ---------------------------    ----------------------------
                                                       2001          2000            2001           2000
                                                 ---------------------------    ----------------------------
                                                   (Unaudited)    (Unaudited)     (Unaudited)    (Unaudited)
<S>                                            <C>            <C>             <C>                <C>
Interest income
     Loans receivable
           Mortgage loans                        $  2,173,011   $  1,965,405    $  6,435,237       5,688,913
           Commercial loans                           414,014        134,946         896,331         354,540
           Share and consumer loans                   150,367        121,765         460,612         350,339
     Investment and mortgage-backed securities        889,473        787,128       2,758,665       2,121,319
     Other interest-earning assets                     80,675         70,254         250,988         193,156
                                                 ------------   ------------    ------------    ------------

           TOTAL INTEREST EARNINGS                  3,707,540      3,079,498      10,801,833       8,708,267

Interest expense
     Deposits                                       1,059,907        808,376       2,860,723       2,385,421
     Advances from Federal Home Loan Bank           1,193,820      1,034,046       3,965,278       2,736,404
     Repurchase agreements                             11,980          2,189          54,604           3,101
                                                 ------------   ------------    ------------    ------------

           TOTAL INTEREST EXPENSE                   2,265,707      1,844,611       6,880,605       5,124,926
                                                 ------------   ------------    ------------    ------------

           NET INTEREST EARNINGS                    1,441,833      1,234,887       3,921,228       3,583,341

Provision for loan losses                             120,000         70,000         270,000         130,000
                                                 ------------   ------------    ------------    ------------

           NET INTEREST EARNINGS AFTER
           PROVISION FOR LOAN LOSSES                1,321,833      1,164,887       3,651,228       3,453,341

Non-interest income
     Income from real estate operations                     0          2,500               0           5,000
     Miscellaneous income                              11,160          5,026          58,287          13,311
     Net gains from sales of loans                        950          7,306          18,682          26,122
     Gains from sales of AFS securities                11,261              0          11,261           4,539
     Losses from sales of AFS securities                    0        (67,718)           (336)        (70,552)
     Service charge income                             70,569         57,247         220,740         187,707
                                                 ------------   ------------    ------------    ------------

           TOTAL NON-INTEREST INCOME                   93,940          4,361         308,634         166,127

Non-interest expense
     Compensation and benefits                        402,721        431,280       1,235,229       1,230,279
     FDIC Insurance                                     3,867          4,148          12,041          27,105
     Insurance                                          8,872          8,085          25,275          23,467
     Stock services                                     2,514          4,169          10,747          10,071
     Occupancy                                         88,456         85,621         262,596         244,736
     Data processing                                   61,040         50,863         163,226         147,720
     Professional fees                                 14,274         20,303          66,165          67,579
     Advertising                                       17,250         13,811          58,468          48,722
     Stationery, printing and office supplies          14,609         19,440          49,818          59,154
     ATM expense                                        9,169         12,045          30,801          37,715
     Supervisory exam fees                             12,130         10,384          34,081          29,367
     Postage                                           13,925          9,391          32,725          25,363
     Other                                             80,563         57,829         213,754         156,719
                                                 ------------   ------------    ------------    ------------

           TOTAL NON-INTEREST EXPENSE                 729,390        727,369       2,194,926       2,107,997
                                                 ------------   ------------    ------------    ------------

</TABLE>


                                       4

<PAGE>

                               GFSB Bancorp, Inc.

                       CONSOLIDATED STATEMENTS OF EARNINGS
                      AND COMPREHENSIVE EARNINGS-CONTINUED

<TABLE>
<CAPTION>
                                                                            Three months ended          Nine months ended
                                                                                March 31,                   March 31,
                                                                       -------------------------    -------------------------
                                                                            2001          2000           2001          2000
                                                                       -------------------------    -------------------------
                                                                         (Unaudited)   (Unaudited)   (Unaudited)   (Unaudited)
<S>                                                                   <C>           <C>            <C>           <C>
                 EARNINGS BEFORE INCOME TAXES                              686,383       441,879      1,764,936     1,511,471
Income tax expense
       Currently payable                                                   243,406       148,912        590,226       534,430
       Deferred provision                                                        -             -              -             -
                                                                       -----------   -----------    -----------   -----------
                                                                           243,406       148,912        590,226       534,430
                                                                       -----------   -----------    -----------   -----------
                 NET EARNINGS                                          $   442,977   $   292,967      1,174,710       977,041
                                                                       ===========   ===========    ===========   ===========

Other Comprehensive Earnings
       Unrealized gain (loss), net of tax                                  193,601       (16,594)     1,151,429      (389,483)
                                                                       -----------   -----------    -----------   -----------
                 COMPREHENSIVE EARNINGS                                    636,578       276,373      2,326,139       587,558
                                                                       ===========   ===========    ===========   ===========
Earnings per common share
       Basic                                                           $      0.40          0.26           1.06          0.85
                                                                       ===========   ===========    ===========   ===========
Weighted average number of common shares outstanding
       Basic                                                             1,097,536     1,143,409      1,105,920     1,152,036
                                                                       ===========   ===========    ===========   ===========
Earnings per common share
       Diluted                                                                0.39          0.25           1.04          0.83
                                                                       ===========   ===========    ===========   ===========
Weighted average number of common shares outstanding
       Diluted                                                           1,123,578     1,166,315      1,134,130     1,174,942
                                                                       ===========   ===========    ===========   ===========
Comprehensive earnings per common share
       Basic                                                                  0.58          0.24           2.10          0.51
                                                                       ===========   ===========    ===========   ===========
       Diluted                                                                0.57          0.24           2.05          0.50
                                                                       ===========   ===========    ===========   ===========
</TABLE>


                                       5
<PAGE>
                               GFSB Bancorp, Inc.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                    Nine months ended
                                                                        March 31,
                                                              ----------------------------
                                                                   2001            2000
                                                              ------------    ------------
                                                                (Unaudited)     (Unaudited)
<S>                                                         <C>             <C>
Cash flows from operating activities
     Net earnings                                             $  1,174,710    $    977,041
     Adjustments to reconcile net earnings to
       net cash provided by operations
              Deferred loan origination fees                      (257,244)       (231,360)
              Loss (gain) on sale of loans and securities          (29,607)         39,891
              Provision for loan losses                            270,000         130,000
              Depreciation of premises and equipment               135,043         133,468
              Amortization of investment and mortgage-
                backed securities premiums                          55,439         126,429
              Stock dividend on FHLB stock                        (205,300)       (144,400)
              Release of ESOP stock                                 78,455          72,124
              Stock compensation                                    38,340          48,664
              Provision (benefit) for deferred income taxes              -         (23,892)

     Net changes in operating assets and liabilities
              Accrued interest and dividends receivable           (105,532)       (184,257)
              Prepaid and other assets                             116,690         (54,177)
              Accrued interest payable                             142,814          58,831
              Accounts payable and accrued liabilities              42,839         (32,163)
              Repurchase agreements                              1,147,635         271,139
              Income taxes payable                                 182,605        (238,044)
              Dividends declared and payable                         9,578          15,602
                                                               -----------    ------------
                   Net cash provided by
                   operating activities                          2,796,465         964,896
                                                               -----------    ------------
Cash flows from investing activities
     Purchase of premises and equipment                            (75,125)        (41,804)
     Loan originations and principal
       repayment on loans, net                                 (17,940,653)     (9,374,012)
     Principal payments on mortgage-backed
       securities                                                3,521,945       4,341,753
     Purchases of mortgage-backed securities                    (2,504,724)           --
     Purchases of available-for-sale securities                 (3,284,814)    (15,929,426)
     Maturities and proceeds from sale of
       available-for-sale securities                             6,442,814       4,112,575
     Principal payments on available-for-sale securities           213,475          76,900
     Principal payments on hold-to-maturity securities              10,000            --
     Purchases of hold-to-maturity securities                     (270,000)           --
     Purchase of FHLB stock                                       (199,200)       (775,900)
                                                               -----------    ------------
                   Net cash used by
                   investing activities                        (14,086,282)    (17,589,914)
                                                               -----------    ------------

</TABLE>

                                       6
<PAGE>

                               GFSB Bancorp, Inc.

                CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED


<TABLE>
<CAPTION>
                                                                 Nine months ended
                                                                      March 31,
                                                         ----------------------------------
                                                               2001               2000
                                                         ---------------    ---------------
                                                             (Unaudited)        (Unaudited)
<S>                                                    <C>                <C>
Cash flows from financing activities
     Net increase in transaction accounts, passbook
       savings, money market accounts, and
       certificates of deposit                           $    22,964,390    $     1,428,758
     Net increase in mortgage escrow funds                       326,507            197,791
     Proceeds from FHLB advances                           1,616,072,346        487,058,922
     Repayments on FHLB advances                          (1,627,852,976)      (471,918,956)
     Purchase of GFSB Bancorp stock under
       stock repurchase plan in cash                            (291,930)          (539,640)
     Dividends paid or to be paid in cash                       (275,284)          (255,824)
     Price paid for vested management bonus
       stock plan stock                                           50,512             55,463
     Proceeds from exercise of stock options                        --               19,425
                                                         ---------------    ---------------
                   Net cash provided by
                   financing activities                       10,993,565         16,045,939
                                                         ---------------    ---------------

     Decrease in cash and cash equivalents                      (296,252)          (579,079)

     Cash and cash equivalents at beginning of period          4,090,965          5,147,215
                                                         ---------------    ---------------
     Cash and cash equivalents at end of period          $     3,794,713          4,568,136
                                                         ===============    ===============

Supplemental disclosures of cash flow information
     Cash paid during the period for
            Interest on deposits and advances            $     6,683,186    $     5,062,994
            Income taxes                                         408,790            772,475

     Change in unrealized gain (loss), net of deferred
       taxes on available-for-sale securities                  1,151,429           (389,483)

     Dividends declared not yet paid                              98,453             90,350

</TABLE>
                                       7
<PAGE>

                               GFSB BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (unaudited)

         1. The accompanying unaudited 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 generally accepted accounting principles. 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  consolidated  statements of
income 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 generally accepted accounting  principles
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  statement be read in conjunction  with the Form 10-KSB for
the year ended June 30, 2000.

2.       Stock Dividend

The Board of  Directors  of the  Company  announced  on October  31,  2000,  the
declaration of a 25% stock dividend payable on December 15, 2000 to shareholders
of record on December 1, 2000. The basic and diluted  weighted average number of
shares  outstanding  and net  earnings  and  comprehensive  earnings  per  share
information  for all prior  reporting  periods have been restated to reflect the
effects of the stock dividend.

                                       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,  and 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. ("GFSB Bancorp") is a bank 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.


FINANCIAL CONDITION

The total  assets of the  Company  increased  $15.6  million or 8.8% from $176.8
million at June 30, 2000 to $192.3 million at March 31, 2001.  This increase was
primarily the result of an $18 million dollar increase in the Company's net loan
portfolio,   offset  by  a   decrease   of  $2.4   million   in  the   Company's
available-for-sale  investment portfolio.  Of this loan increase,  approximately
$12.2  million was in  commercial  loans,  $4.5 million in consumer  residential
loans,  and $1.8 million in commercial real estate  non-residential  loans.  The
increase was the result of the Company  hiring a new senior  lending  officer in
May 2000 and management  efforts to increase lending  activity.  The decrease in
the  investment  portfolio  is due  primarily  to  proceeds  received  from  net
maturities and sales of available-for-sale securities of $3.2 million.

At March 31, 2001 total liabilities  increased $13.7 million or 8.3% from $164.1
million at June 30, 2000 to $177.8 million at March 31, 2001.  This increase was
primarily due to an increase in deposits of $23 million, offset by a decrease in
borrowings from the Federal Home Loan Bank (FHLB) of $11.8 million. The increase
in deposits was primarily the result of growth in the Company's  volume of jumbo
certificates of deposit  (public,  brokered and private) and transaction and NOW
accounts. This increase was primarily attributed to the increase in market rates
paid on these products. Funds used from growth of deposits were used to pay down
FHLB  advances.  At March 31, 2001,  accumulated  other  comprehensive  earnings
increased  by $1.2  million to $1.3  million  from  $130,000  at June 30,  2000,
respectively  from market gains on the Company's  available-for-sale  investment
securities and available-for-sale mortgage-backed securities.

                                       9
<PAGE>

RESULTS OF OPERATIONS

COMPARISON  OF OPERATING  RESULTS FOR QUARTER  ENDED MARCH 31, 2001  COMPARED TO
QUARTER ENDED MARCH 31, 2000.

General

Net income for the quarter ended March 31, 2001  increased  $150,000 to $443,000
compared to net income of $293,000 for the comparable quarter 2000. The increase
in net  income  was the  result of  higher  net  interest  earnings  income  and
non-interest  earnings  offset by increases to the provision for loan losses and
non-interest  expense. See "Average Balance Sheets and Rate/Volume Analysis" for
the details of the  Company's  results of  operations  for the current and prior
three-month periods.

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>
                                              Quarter ended                                  Quarter ended
                                              March 31, 2001                                 March 31, 2000
                                              --------------                                 --------------
                                   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)               $125,317        $2,738           8.74%       $105,947         $2,222           8.39%
Investment securities and
 mortgage-backed securities          54,739           889           6.50%         49,791            787           6.32%
Other interest-earning
  assets (2)                          5,706            81           5.67%          4,842             70           5.78%
                                 -----------    ----------                    -----------     ----------

Total interest-earning assets       185,762         3,708           7.98%        160,580          3,079           7.67%
Non-interest-earning assets           5,631                                        5,679
                                 -----------                                  -----------

Total assets                       $191,393                                     $166,259
                                 ===========                                 ============

Interest-bearing liabilities:
  Transaction accounts              $ 6,370          $ 23          1.44%        $ 5,943          $ 21            1.41%
  Passbook savings                    4,835            22          1.82%          4,979            25            2.01%
  Money market accounts               9,634            82          3.40%          9,998            77            3.08%
  Certificates of deposit            63,091           933          5.92%         53,766           685            5.10%
  Other liabilities (3)              83,319         1,206          5.79%         71,812         1,036            5.77%
                                 -----------    ----------                   -----------    ----------      -----------

Total interest-bearing
   liabilities                      167,249         2,266          5.42%        146,498         1,844            5.03%
Non-interest bearing
   liabilities                        9,814                                       7,408
                                 -----------                                 -----------

Total liabilities                   177,063                                     153,906

Stockholders' equity                 14,330                                      12,353
                                 -----------                                 -----------
Total liabilities and
  Stockholders' equity             $191,393                                    $166,259
                                 ===========                                 ===========

Net interest income                                $1,442                                      $1,235
                                                ==========                                  ==========
                                       10
<PAGE>
Interest rate spread (4)                                           2.56%                       2.64%
                                                              ===========                    ========
Net yield on interest-
  earning  assets (5)                                              3.11%                       3.08%
                                                              ===========                    ========
Ratio of average interest-
  earning assets to average
interest-bearing  liabilities                                      1.11X                       1.10X
                                                              ===========                    ========
</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.

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, 2001 vs. 2000
                                                  Increase (decrease)
                                                         Due to
                                             -----------------------------------
                                                               Rate/
                                             Volume     Rate   Volume     Net
                                             ------     ----   ------     ---
                                                 (Dollars in Thousands)
Interest income:
  Loans receivable                            $ 406    $  93    $  17   $ 516
  Mortgage-backed securities and
     investment securities                       78       22        2     102
  Other interest-earning  assets                 12       (1)       -      11
                                              -----    -----    -----   -----
    Total interest-earning assets               496      114       19     629
                                              -----    -----    -----   -----
Interest expense:

  Transaction accounts                            2        -        -       2
  Savings accounts                               (1)      (2)       -      (3)
  Money markets                                  (3)       8        -       5
  Certificates of deposit                       119      110       19     248
  Other liabilities                             166        4        -     170
                                              -----    -----    -----   -----
   Total interest-bearing liabilities           283      120       19     422
                                              -----    -----    -----   -----
Net change in interest income                 $ 213    $  (6)   $   -   $ 207
                                              =====    =====    =====   =====

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 $120,000 and $70,000 for the
quarter  ended  March  31,  2001 and 2000,  respectively.  The  increase  in the
provision for loan losses for the current  three-month  period was the result of
the growth in commercial  and commercial  real estate loans,  which tend to have
greater  credit  risk than  residential  real  estate  loans.  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.  Recent
substantial  increases  in the
                                       11
<PAGE>
loan  portfolio of the Company may result in an increase of provision for losses
on loans.

Non-Interest Income

Total non-interest income increased by $89,600 from $4,400 for the quarter ended
March 31, 2000 to $93,900 for the quarter ended March 31, 2001.  The increase in
non-interest  income for the quarter  ended March 31, 2001 is  primarily  due to
increased  income  from  gains from the sale of  available-for-sale  securities,
miscellaneous  income and service charge income.  Miscellaneous income increased
$6,100,  due primarily to an increase in commission  fees  collected from credit
card  merchant  sales of $3,300 and $1,800 from a gain on the sale of equipment.
Service charge income  increased  $13,300 as the result of increased NSF charges
collected on NOW and checking  accounts.  For the quarter  ended March 31, 2000,
the Company  incurred losses from the sale of  available-for-sale  securities of
$67,700,  which primarily  accounted for the lower  non-interest  income for the
previous year period.


Non-Interest Expense

Total non-interest  expense increased $2,000 from $727,400 for the quarter ended
March 31, 2000 to $729,400 for the quarter  ended March 31,  2001.  Though total
non-interest  expense remained virtually  unchanged for the current 2001 quarter
as compared to the 2000 quarter,  the most  significant  change in  non-interest
expense was a $28,600  decrease in compensation and benefits offset by increases
of  $10,200  in data  processing  expense,  and  $22,700  in other  non-interest
expense.  The decrease in compensation  and benefits expense reflects $24,300 in
general  salaries and benefits  expense  primarily  due to hiring of  additional
staff and general  merit  increases  which were offset by  decreased  charges of
$11,900 relating to the 1996 management stock  compensation  plan and $41,000 of
state gross  receipt  tax.  The  participants  of the 1996 awards from the stock
compensation  plan became  fully  vested at January 5, 2001.  During the quarter
ended March 31, 2000,  the Company paid to the state  $41,000 in gross  receipts
tax for director's  fees.  Data  processing  expense  increased  $10,200 for the
current 2001 quarter  primarily due to a $5,800  charge to computer  expense for
the  replacement  of  network  software,  which  was not fully  depreciated  and
increases in service bureau expense resulting from growth in deposits and loans.
Other  non-interest  expense increased $22,700 primarily due to normal increases
in operating  expenses,  which included $11,000 in telephone expenses related to
the upgrade in telephone services.

                                       12
<PAGE>

RESULTS OF OPERATIONS

COMPARISON OF OPERATING  RESULTS FOR THE NINE-MONTH  PERIOD ENDED MARCH 31, 2001
COMPARED TO THE NINE-MONTH PERIOD ENDED MARCH 31, 2000.

General

Net income for the nine  months  ended  March 31,  2001  increased  $198,000  to
$1,175,000  compared to net income of  $977,000  for the  comparable  nine-month
period in 2000. The increase in net income was the result of higher net interest
earnings income and  non-interest  earnings offset by increases to the provision
for loan  losses and  non-interest  expense.  See  "Average  Balance  Sheets and
Rate/Volume Analysis" for the details of the Company's results of operations for
the current and prior nine-month periods.

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, 2001                                 March 31, 2000
                                             --------------                                 --------------

                                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)               $119,120        $7,792           8.72%       $102,021         $6,394           8.36%
Investment securities and
 mortgage-backed securities          55,490         2,759           6.63%         47,696          2,121           5.93%
Other interest-earning
  assets (2)                          5,515           251           6.07%          4,627            193           5.56%
                                 -----------    ----------                    -----------     ----------

Total interest-earning assets       180,125        10,802           8.00%        154,344          8,708           7.52%
Non-interest-earning assets           5,830                                        5,221
                                 -----------                                  -----------

Total assets                       $185,955                                     $159,565
                                 ===========                                 ============

Interest-bearing liabilities:
  Transaction accounts              $ 6,169          $ 69          1.49%        $ 5,959          $ 68            1.52%
  Passbook savings                    4,935            73          1.97%          4,930            75            2.03%
  Money market accounts               9,494           250          3.51%         10,336           229            2.95%
  Certificates of deposit            57,207         2,469          5.75%         52,697         2,013            5.09%
  Other liabilities (3)              85,251         4,020          6.29%         65,415         2,740            5.58%
                                 -----------    ----------                   -----------    ----------      -----------
Total interest-bearing
   liabilities                      163,056         6,881          5.63%        139,337         5,125            4.90%
Non-interest bearing
   liabilities                        9,248                                       7,832
                                 -----------                                 -----------

Total liabilities                   172,304                                     147,169

Stockholders' equity                 13,651                                      12,396
                                 -----------                                 -----------
Total liabilities and
  Stockholders' equity             $185,955                                    $159,565
                                 ===========                                 ===========

Net interest income                                $3,921                                      $3,583
                                                ==========                                  ==========

                                       13
<PAGE>
Interest rate spread (4)                                           2.37%                        2.62%
                                                              ===========                    =========
Net yield on interest-
  earning  assets (5)                                              2.90%                        3.10%
                                                              ===========                    =========
Ratio of average interest-
  earning assets to average
interest-bearing  liabilities                                      1.10X                        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.

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.

                                                Nine-month period ended
                                                 March 31, 2001 vs. 2000
                                                  Increase (decrease)
                                                         Due to
                                        ----------------------------------------
                                                              Rate/
                                         Volume     Rate      Volume       Net
                                         ------     ----      ------     -----
                                                 (Dollars in Thousands)
Interest income:
  Loans receivable                      $ 1,072   $   275    $    51    $ 1,398
  Mortgage-backed securities and
     investment securities                  347       250         41        638
  Other interest-earning  assets             37        18          3         58
                                        -------   -------    -------    -------
    Total interest-earning assets         1,456       543         95      2,094
                                        -------   -------    -------    -------
Interest expense:

  Transaction accounts                        2        (1)         -          1
  Savings accounts                            -         -         (2)        (2)
  Money markets                             (18)       43         (4)        21
  Certificates of deposit                   173       261         22        456
  Other liabilities                         829       347        104      1,280
                                        -------   -------    -------    -------
   Total interest-bearing liabilities       986       650        120      1,756
                                        -------   -------    -------    -------
Net change in interest income           $   470   $  (107)   $   (25)   $   338
                                        =======   =======    =======    =======

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 $270,000 and $130,000 for the
nine-month period ended March 31, 2001 and 2000,  respectively.  The increase in
the provision for loan losses for the current  nine-month  period was the result
of the growth in commercial and commercial real estate loans, which tend to have
greater  credit  risk than  residential  real  estate  loans.  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.  Recent
substantial  increases  in the
                                       14
<PAGE>
loan  portfolio of the Company may result in an increase of provision for losses
on loans.

Non-Interest Income

Total  non-interest  income  increased  by $142,500  from  $166,100 for the nine
months  ended  March 31, 2000 to  $308,600  for the nine months  ended March 31,
2001.  The increase in  non-interest  income for the nine months ended March 31,
2001 primarily is due to increased  miscellaneous income, gains from the sale of
available-for- sale securities,  and service charge fees.  Miscellaneous  income
increased  $45,000,  due  primarily  to a gain on the sale of other real  estate
owned of $21,000,  an increase in  commission  fees  collected  from credit card
merchant sales of $14,200,  a gain on the sale of equipment of $1,800 and $6,000
from a wining raffle ticket,  which the Company  subsequently donated to several
local  charities.  Service  charge  income  increased  $33,000  as the result of
increased  NSF charges  collected  on NOW and  checking  accounts.  For the nine
months  ended  March 31,  2000,  the  Company  incurred  losses from the sale of
available-for-sale securities of $70,600, which primarily accounts for the lower
non-interest income for the previous year period.

Non-Interest Expense

Total non-interest expense increased $86,900 from $2,108,000 for the nine months
ended March 31, 2000 to $2,194,900 for the nine months ended March 31, 2001. The
most  significant  changes in non-interest  expense were increases in occupancy,
data processing, and other non-interest expenses, which were offset by decreased
FDIC insurance assessments and ATM expense.  Occupancy expense increased $17,900
primarily due to increased  automated teller machine maintenance  expense.  Data
processing  increased  $15,500  primarily  due to a $5,800  charge  to  computer
expense for the replacement of network software, which was not fully depreciated
and increases in service  bureau  expense  resulting from growth in deposits and
loans.  Other  non-interest  expense  increased  $57,000 primarily due to normal
increases in operating  expense,  which  included  $29,000 in telephone  expense
related to the upgrade in  telephone  services.  Effective  January  2000,  FDIC
assessments were lowered. The $6,900 decrease in ATM expense is primarily due to
the reduction in use of our customer's using foreign ATM machines.

Liquidity and Capital Resources

The Bank is required under applicable  federal  regulations to maintain "liquid"
investments  in qualifying  types of U.S.  Government,  federal agency and other
investments of not less than 4% of its average daily balance of net withdrawable
deposit accounts and borrowings  payable in one year of less. At March 31, 2001,
the Bank's liquidity, as measured for regulatory purposes, was 5.28%.

At March 31, 2001, the Bank exceeded each of the three OTS capital  requirements
on a fully-phased-in basis.

                                       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
         --------------------------------
<TABLE>
<CAPTION>
          <S>         <C>
            (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****
</TABLE>

         --------------
         *        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.

                                       16
<PAGE>

         ***      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.

                                       17

<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 7, 2001             /s/Jerry R. Spurlin
         -----------             -----------------------------------------------
                                 Jerry R. Spurlin
                                 Assistant Secretary and Chief Financial Officer
                                 (Duly Authorized Representative and
                                 Principal Financial Officer)


                                       18