# UNITED STATESSECURITIES AND
EXCHANGE COMMISSION Washington, D.C. 20549

# Form 10-Q

|[ X ] QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly
period ended March 31, 2007     
|------------------------------------------------------------------------------------------------------------------------------------------------
|OR                                                                                                                                              
|[__] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to _______

Commission file number
0-25752

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

|MICHIGAN                                                       | 38-2869722                          
|-------------------------------------------------------------- | ------------------------------------
|(State or other jurisdiction of incorporation or
organization) | (I.R.S. Employer Identification No.)

101 East Grand River,
Howell, Michigan 48843 (Address of principal
executive offices) (Zip Code)

Registrants
telephone number, including area code: (517) 546-3150

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

Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.
See definition or accelerated filer and large accelerated filer Rule 12b-2 of
the Exchange Act. (Check one): Large accelerated filer [__]    
Accelerated filer [ X ]     Non-accelerated filer [__]

Indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Act).
Yes [__]     No [ X ]

The number of shares outstanding of
each of the issuers classes of common stock, as of the latest practicable date:
3,040,729 shares of the Corporations Common Stock (no par value) were outstanding as
of April 30, 2007.

---



# TABLE OF CONTENTS

|                                                                                             
|---------------------------------------------------------------------------------------------
|Part I. Financial Information (unaudited)                                                    
|Item 1. Financial Statements:                                                                
|Consolidated Balance Sheets as of March 31, 2007 and December 31, 2006                       
|Consolidated Statements of Income for the three months ended March 31, 2007                  
|and 2006                                                                                     
|Consolidated Statements of Stockholders' Equity and Comprehensive Income                     
|for the three months ended March 31, 2007 and 2006                                           
|Consolidated Statements of Cash Flows for the three months ended March 31, 2007 and 2006     
|Notes to Consolidated Financial Statements                                                   
|                                                                                             
|Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
|Item 3. Quantitative and Qualitative Disclosures about Market Risk                           
|Item 4. Controls and Procedures                                                              
|                                                                                             
|Part II.  Other Information                                                                  
|Item 1A. Risk Factors                                                                        
|Item 2. Unregistered Sales of Equity Securities and Use of Proceeds                          
|Item 6. Exhibits                                                                             
|                                                                                             
|Signatures                                                                                   
|                                                                                             

---



PART I 
FINANCIAL INFORMATION Item 1. Financial
Statements

# FNBH BANCORP, INC. AND
SUBSIDIARIES                                                              Consolidated
Balance Sheets (Unaudited)

|Assets                                                                 | March 312007 | December 312006
|---------------------------------------------------------------------- | ------------ | ---------------
|                                                                       |              |                
|Cash and due from banks                                                |              |                
|Short term investments                                                 |              |                
|                                                                       |              |                
|Total cash and cash equivalents                                        |              |                
|Certificates of deposit                                                |              |                
|Investment Securities:                                                 |              |                
|Investment securities held to maturity, net (fair value of $17,036,196 |              |                
|at March 31, 2007 and $17,030,269 at December 31, 2006)                |              |                
|Investment securities available for sale, at fair value                |              |                
|Mortgage-backed securities available for sale, at fair value           |              |                
|FHLBI and FRB stock, at cost                                           |              |                
|                                                                       |              |                
|Total investment securities                                            |              |                
|Loans:                                                                 |              |                
|Commercial                                                             |              |                
|Consumer                                                               |              |                
|Real estate mortgage                                                   |              |                
|                                                                       |              |                
|Total loans                                                            |              |                
|Less allowance for loan losses                                         |              |                
|                                                                       |              |                
|Net loans                                                              |              |                
|Premises and equipment, net                                            |              |                
|Other real estate owned, held for sale                                 |              |                
|Accrued interest and other assets                                      |              |                
|                                                                       |              |                
|Total assets                                                           |              |                
|                                                                       |              |                
|                                                                       |              |                
|Liabilities and Stockholders' Equity                                   |              |                
|Liabilities                                                            |              |                
|Deposits:                                                              |              |                
|Demand (non-interest bearing)                                          |              |                
|NOW                                                                    |              |                
|Savings and money market                                               |              |                
|Time deposits                                                          |              |                
|Brokered certificates of deposit                                       |              |                
|                                                                       |              |                
|Total deposits                                                         |              |                
|Other borrowings                                                       |              |                
|Accrued interest, taxes, and other liabilities                         |              |                
|                                                                       |              |                
|Total liabilities                                                      |              |                
|Stockholders' Equity                                                   |              |                
|Common stock, no par value. Authorized 4,200,000 shares; 3,039,588     |              |                
|shares issued and outstanding at March 31, 2007 and 3,074,528          |              |                
|shares issued and outstanding at December 31, 2006                     |              |                
|Retained earnings                                                      |              |                
|Deferred directors' compensation                                       |              |                
|Accumulated other comprehensive loss, net                              |              |                
|                                                                       |              |                
|Total stockholders' equity                                             |              |                
|                                                                       |              |                
|Total liabilities and stockholders' equity                             |              |                
|                                                                       |              |                

See notes to consolidated
financial statements.

1

---



FNBH BANCORP, INC. AND
SUBSIDIARIES  Consolidated Statements of Income (Unaudited)

|                                                    | Three months ended March 30
|--------------------------------------------------- | ---------------------------
|                                                   
|                                                    |                            
|Interest and dividend income:                       |                            
|Interest and fees on loans                          |                            
|Interest and dividends on investment securities:    |                            
|U.S. Treasury and agency securities                 |                            
|Obligations of states and political subdivisions    |                            
|Corporate bonds                                     |                            
|Other securities                                    |                            
|Interest on short term investments                  |                            
|Interest on certificates of deposit                 |                            
|                                                    |                            
|Total interest and dividend income                  |                            
|                                                    |                            
|                                                    |                            
|Interest expense:                                   |                            
|Interest on deposits                                |                            
|Interest on other borrowings                        |                            
|                                                    |                            
|Total interest expense                              |                            
|                                                    |                            
|                                                    |                            
|Net interest income                                 |                            
|                                                    |                            
|Provision for loan losses                           |                            
|                                                    |                            
|Net interest income after provision for loan losses |                            
|                                                    |                            
|                                                    |                            
|Noninterest income:                                 |                            
|Service charges and other fee income                |                            
|Trust income                                        |                            
|Gain on sale of loans                               |                            
|Other                                               |                            
|                                                    |                            
|Total noninterest income                            |                            
|                                                    |                            
|                                                    |                            
|Noninterest expense:                                |                            
|Salaries and employee benefits                      |                            
|Net occupancy expense                               |                            
|Equipment expense                                   |                            
|Professional and service fees                       |                            
|Computer service fees                               |                            
|Directors' fees                                     |                            
|Printing and supplies                               |                            
|Advertising                                         |                            
|Other                                               |                            
|                                                    |                            
|Total noninterest expense                           |                            
|                                                    |                            
|Income before federal income taxes                  |                            
|Federal income taxes                                |                            
|                                                    |                            
|Net income                                          |                            
|                                                    |                            
|                                                    |                            
|Per share statistics:                               |                            
|Basic EPS                                           |                            
|Diluted EPS                                         |                            
|Dividends                                           |                            
|Basic average shares outstanding                    |                            
|Diluted average shares outstanding                  |                            

See notes to consolidated
financial statements.

2

---



FNBH BANCORP, INC. AND
SUBSIDIARIES Consolidated Statements of Stockholders' Equity and Comprehensive Income
                 For the Three Months Ended March 31, 2007 and 2006 (Unaudited)

|                                                     | Common
Stock | Retained
Earnings | Deferred
Directors'
Compensation | Accumulated
Other
Comprehensive
Loss | Total    
|---------------------------------------------------- | ------------ | ----------------- | -------------------------------- | ------------------------------------ | ---------
|                                                     |             
|Balances at December 31, 2005                        |              |                   | $                                | 6,088,540                            |          
|Earned portion of long term incentive plan           |              |                   |                                  | 14,855                               |          
|Issued 434 shares for employee stock purchase plan   |              |                   |                                  | 10,673                               |          
|Issued 224 shares for current directors' fees        |              |                   |                                  | 5,797                                |          
|Directors' deferred compensation (968 stock units)   |              |                   |                                  |                                      | 25,043   
|Comprehensive income:                                |              |                  
|Net income                                           |              |                   |                                  |                                      | 1,602,748
|Change in unrealized loss on debt securities         |              |                  
|available for sale, net of tax effect                |              |                   |                                  |                                      | (46,526  
|                                                     |             
|Total comprehensive income                           |              |                   |                                  |                                      | 1,556,222
|Repurchase of common stock (7,000 shares)            |              |                   |                                  | (13,650                              | )        
|                                                     |             
|Cash dividends ($.21 per share)                      |              |                   |                                  |                                      | (667,878 
|                                                     |             
|Balances at March 31, 2006                           |              |                   | $                                | 6,106,215                            |          
|                                                     |             
|                                                     |              |                  
|Balances at December 31, 2006                        |              |                   | $                                | 6,005,835                            |          
|Earned portion of long term incentive plan           |              |                   |                                  | 95,034                               |          
|Issued 413 shares for employee stock purchase plan   |              |                   |                                  | 10,371                               |          
|Issued 75 shares for current directors' fees         |              |                   |                                  | 1,982                                |          
|Directors' deferred compensation (1,215 stock units) |              |                   |                                  |                                      | 32,107   
|Issued 685 deferred shares                           |              |                   |                                  | 14,549                               |          
|Comprehensive income:                                |              |                  
|Net income                                           |              |                   |                                  |                                      | 979,124  
|Change in unrealized loss on debt securities         |              |                  
|available for sale, net of tax effect                |              |                   |                                  |                                      | 72,750   
|                                                     |             
|Total comprehensive income                           |              |                   |                                  |                                      | 1,051,874
|Repurchase of common stock (39,000 shares)           |              |                   |                                  | (77,610                              | )        
|Cash dividends ($.21 per share)                      |              |                   |                                  |                                      | (645,741 
|                                                     |             
|Balances at March 31, 2007                           |              |                   | $                                | 6,050,161                            |          
|                                                     |             

See notes to consolidated
financial statements.

3

---



FNBH BANCORP, INC. AND
SUBSIDIARIES                                                              Consolidated
Statements of Cash Flows (Unaudited)

|                                                                                  | Three months ended March 31
|--------------------------------------------------------------------------------- | ---------------------------
|                                                                                 
|                                                                                  |                            
|Cash flows from operating activities:                                             |                            
|Net income                                                                        |                            
|Adjustments to reconcile net income to net cash provided by operating activities: |                            
|Provision for loan losses                                                         |                            
|Depreciation and amortization                                                     |                            
|Deferred income tax expense (benefit)                                             |                            
|Net amortization on investment securities                                         |                            
|Earned portion of long term incentive plan                                        |                            
|Shares issued for current directors' compensation                                 |                            
|Shares earned for deferred directors' compensation                                |                            
|Gain on sale of loans                                                             |                            
|Proceeds from sale of loans                                                       |                            
|Origination of loans held for sale                                                |                            
|Loss on the sale of other real estate owned, held for sale                        |                            
|Increase in accrued interest income and other assets                              |                            
|Increase (decrease) in accrued interest, taxes, and other liabilities             |                            
|                                                                                  |                            
|Net cash provided by operating activities                                         |                            
|                                                                                  |                            
|Cash flows from investing activities:                                             |                            
|Purchases of held to maturity securities                                          |                            
|Proceeds from maturities and at-par calls of available for sale securities        |                            
|Proceeds from mortgage-backed securities paydowns-available for sale              |                            
|Proceeds from maturities and calls of held to maturity securities                 |                            
|Purchases of certificates of deposit                                              |                            
|Maturity of certificates of deposit                                               |                            
|Net increase in loans                                                             |                            
|Proceeds from sale of other real estate owned, held for sale                      |                            
|Capital expenditures                                                              |                            
|                                                                                  |                            
|Net cash provided by (used in) investing activities                               |                            
|                                                                                  |                            
|Cash flows from financing activities:                                             |                            
|Net increase (decrease) in deposits                                               |                            
|Payments on FHLBI note                                                            |                            
|Proceeds from issuance of short term debt                                         |                            
|Repayment of short term debt                                                      |                            
|Repurchase of common stock                                                        |                            
|Dividends paid                                                                    |                            
|Shares issued for employee stock purchase plan                                    |                            
|                                                                                  |                            
|Net cash provided used in financing activities                                    |                            
|                                                                                  |                            
|Net increase (decrease) in cash and cash equivalents                              |                            
|Cash and cash equivalents at beginning of year                                    |                            
|                                                                                  |                            
|Cash and cash equivalents at end of period                                        |                            
|                                                                                  |                            
|Supplemental disclosures:                                                         |                            
|Interest paid                                                                     |                            
|Federal income taxes paid                                                         |                            
|Loans transferred to other real estate                                            |                            
|Loans charged off                                                                 |                            

See notes to consolidated
financial statements.

4

---



Notes to Consolidated
Financial Statements(unaudited) The accompanying unaudited
consolidated financial statements have been prepared in accordance with accounting
principles generally accepted in the United States of America (GAAP) for interim financial
information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required by GAAP for
complete financial statements.

1.    
          In the opinion of management of FNBH Bancorp, Inc. (the Corporation), the
          unaudited consolidated financial statements filed with this Form 10-Q contain
          all adjustments (consisting of only normal recurring accruals) necessary to
          present fairly the consolidated financial position of the Corporation as of
          March 31, 2007, and consolidated results of operations and cash flows for the
          three months ended March 31, 2007 and 2006.

2.    
          The results of operations for the three months ended March 31, 2007 are not
          necessarily indicative of the results to be expected for the full year.

3.    
          The accompanying unaudited consolidated financial statements should be read in
          conjunction with the Consolidated Financial Statements in the 2006 Annual Report
          contained in the Corporations report on Form 10-K filing.

4.    
          The provision for income taxes represents federal income tax expense calculated
          using estimated annualized rates on taxable income generated during the
          respective periods.

5.    
          Investment and Mortgage-Backed Securities. A summary of the amortized cost and
          approximate fair value of investment and mortgage-backed securities at March 31,
          2007 and December 31, 2006 follows:

|                           | March 31, 2007 | December 31, 2006
|-------------------------- | -------------- | -----------------
|                           |                |                  
|                           |                |                  
|                           |                |                  
|Held to maturity:          |                |                  
|Obligations of state and   |                |                  
|political subdivisions     |                |                  
|                           |                |                  
|Total held to maturity     |                |                  
|                           |                |                  
|Available for sale:        |                |                  
|U.S Treasury and agency    |                |                  
|securities                 |                |                  
|Mortgage-backed securities |                |                  
|                           |                |                  
|Total available for sale   |                |                  
|                           |                |                  
|                           |                |                  
|Total securities           |                |                  
|                           |                |                  

There were 16 held to maturity
securities and 34 available for sale securities in a continuous loss position for 12
months or more at March 31, 2007. The available for sale securities consist of 15
asset-backed securities and 19 agency securities. Because the declines in fair value were
due to changes in market interest rates, not in estimated cash flows, and the securities
are bank qualified municipals, federal agencies or mortgage-backed securities issued by
federal agencies, no other-than-temporary impairment was recorded at March 31, 2007. The
Corporation has both the intent and ability to hold these securities for the time
necessary to recover the amortized cost.

5

---



The following is a summary of the
unrealized losses and fair value of the securities at March 31, 2007 by length of time
that individual securities in each category have been in a continuous loss position:

|                           | Less than 12 months | March 31, 200712 months or more | Total
|-------------------------- | ------------------- | ------------------------------- | -----
|                           |                     |                                 |      
|                           |                     |                                 |      
|                           |                     |                                 |      
|Held to maturity:          |                     |                                 |      
|Obligations of state and   |                     |                                
|political subdivisions     |                     |                                 | $    
|                           |                     |                                 |      
|                           |                     |                                
|Available for sale:        |                     |                                
|U.S. Treasury and agency   |                     |                                
|securities                 |                     |                                 | $    
|Mortgage-backed securities |                     |                                 |      
|                           |                     |                                 |      
|Total available for sale   |                     |                                 | $    
|                           |                     |                                 |      

As of December 31, 2006, there were
36 investments that had been in a continuous loss position for 12 months or more and no
impairment was recorded.

6.    
          Managements assessment of the allowance for loan losses is based on an
          evaluation of the loan portfolio, recent loss experience, current economic
          conditions, and other pertinent factors. Loans on non-accrual status and those
          past due more than 90 days amounted to $12,791,000 at March 31, 2007,
          $12,199,000 at December 31, 2006, and $6,728,000 at March 31, 2006. (See
          Managements Discussion and Analysis of Financial Condition and Results of
          Operations).

7.    
          Basic net income per common share is computed by dividing net income applicable
          to common stock by the weighted average number of shares of common stock and
          deferred director fee stock units outstanding during the period. Diluted net
          income per common share is computed by dividing net income applicable to common
          stock by the weighted average number of shares and deferred director fee stock
          units outstanding and potential common stock outstanding, such as shares of
          unvested restricted stock outstanding during the period calculated under the
          treasury stock method.

The following table presents basic
and diluted net income per share:

|                                            | First Quarter
|------------------------------------------- | -------------
|                                           
|                                            |              
|Weighted average basic shares outstanding   |              
|Effect of dilutive restricted stock         |              
|                                            |              
|Weighted average diluted shares outstanding |              
|                                            |              
|Net income                                  |              
|Basic net income per share                  |              
|Diluted net income per share                |              

6

---



8.    
          Under its Long-Term Incentive Plan (the Plan) the Corporation grants
          stock options and restricted stock as compensation to key employees. The
          Corporation has not awarded any stock options under the plan to date. The
          restricted stock awards have a five year vesting period. The awards are recorded
          at fair market value on the grant date and are amortized into salary expense
          over the vesting period. The number of shares available for issuance under the
          Plan can not exceed 200,000. A summary of the activity under the Plan for the
          three months ended March 31, 2007 and 2006 is presented below:

|                          | 2007 | 2006
|------------------------- | ---- | ----
|                          |      |     
|                          |      |     
|                          |      |     
|Outstanding at January 1, |      |     
|Granted                   |      |     
|Vested                    |      |     
|Forfeited                 |      |     
|                          |      |     
|Outstanding at March 31,  |      |     
|                          |      |     

The total fair value of awards
granted during the three months ended March 31, 2007 and 2006 was $83,243 and $0,
respectively. The total fair value of the awards vested during the three months ended at
March 31, 2007 and 2006 was $95,034 and $14,855, respectively. As of March 31, 2007, there
was $91,670 of total unrecognized compensation cost related to nonvested stock awards
under the Plan. That cost is expected to be recognized over a weighted-average period of
3.0 years.

9.    
          Certain amounts included in the 2006 Consolidated Financial Statements have been
          reclassified to conform to the 2007 presentation.

7

---



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

This report includes certain forward-looking
statements, within the meaning of the Private Securities Litigation Reform Act of 1995,
that involve inherent risks and uncertainties. A number of important factors could cause
actual results to differ materially from those in the forward-looking statements. Those
factors include the economic environment, competition, products and pricing in business
areas in which the Corporation operates, prevailing interest rates, changes in government
regulations and policies affecting financial service companies, credit quality and credit
risk management, acquisitions and integration of acquired businesses.

The Corporation, a Michigan business
corporation, is a one bank holding company which owns all of the outstanding capital stock
of First National Bank in Howell (the Bank) and all of the outstanding stock of HB Realty
Co., a subsidiary which owns real estate. The following is a discussion of the
Corporations results of operations for the three months ended March 31, 2007 and
2006, and also provides information relating to the Corporations financial
condition, focusing on its liquidity and capital resources.

|                             | First Quarter
|---------------------------- | -------------
|                            
|                             |              
|Net income (in thousands)    |              
|Basic net income per share   |              
|Diluted net income per share |              

Net income for the three months ended
March 31, 2007 as compared to the same period last year, was negatively affected by higher
interest expense, increased provision for loan losses and lower interest income on
investments due to lower average balances. These unfavorable variances were only partially
offset by increased interest income due to higher average commercial loan balances and
lower noninterest expenses.

Net income for the three months ended
March 31, 2007 decreased $624,000 (38.9%) compared to the same period last year. In the
first quarter of 2007, net interest income decreased $958,000 (16.6%), and the provision
for loan losses increased $339,000 (56.5%), along with a decrease in noninterest income of
$68,000 (6.8%). Partially offsetting these unfavorable variances was a decrease in
noninterest expense of $427,000 (11.0%) and a decrease in federal income taxes of $314,000
(44.7%).

|Net Interest Income           | First Quarter
|----------------------------- | -------------
|(in thousands)                |              
|                              |              
|Interest and dividends income |              
|Interest expense              |              
|                              |              
|                              |              
|Net interest income           |              

8

---



The following tables illustrate some
of the significant factors contributing to the changes in net interest income (fully tax
equivalent basis) for the three months ended March 31:

# INTEREST YIELDS AND
COSTS (in thousands)                       March 31, 2007 and 2006

|                                               | ----------First Quarter Averages----------
|---------------------------------------------- | ------------------------------------------
|                                              
|                                               |                                           
|                                               |                                           
|Assets:                                        |                                           
|Interest earning assets:                       |                                           
|Short term investments                         |                                           
|Certificates of deposit                        |                                           
|Securities:  Taxable                           |                                           
|Tax-exempt (1)                                 |                                           
|Commercial loans (2)(3)                        |                                           
|Consumer loans (2)(3)                          |                                           
|Mortgage loans (2)(3)                          |                                           
|                                               |                                           
|                                               |                                           
|Total earning assets and total interest income |                                           
|                                               |                                           
|Cash and due from banks                        |                                           
|All other assets                               |                                           
|Allowance for loan losses                      |                                           
|                                               |                                           
|Total Assets                                   |                                           
|                                               |                                           
|                                               |                                           
|Liabilities and Stockholders' Equity:          |                                           
|Interest bearing liabilities:                  |                                           
|NOW, Savings & MMDA                            |                                           
|Time                                           |                                           
|Short term borrowings                          |                                           
|FHLBI advances                                 |                                           
|                                               |                                           
|Total interest bearing liabilities and         |                                           
|Total interest expense                         |                                           
|                                               |                                           
|                                               |                                           
|Non-interest bearing deposits                  |                                           
|All other liabilities                          |                                           
|Stockholders' Equity                           |                                           
|                                               |                                           
|Total Liabilities and Shareholders' Equity     |                                           
|                                               |                                           
|Interest spread                                |                                           
|                                               |                                           
|Net interest income-FTE                        |                                           
|                                               |                                           
|Net interest margin                            |                                           
|                                               |                                           

|(1) | Average yields on the above table have been adjusted to a tax-equivalent basis
          using a 34% tax rate and exclude the effect of any market value adjustments
          recorded under Statement of Financial Accounting Standards No. 115.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | For
purposes of the computation above, non-accruing loans are included in the
          average daily loan balances.
|--- | --------------------------------------------------------------------------------------------------------------------

|(3) | Interest
on loans includes origination fees           totaling $85,000 in 2007 and $156,000 in
2006.
|--- | ----------------------------------------------------------------------------------------------------

9

---



Interest Earning
Assets/Interest IncomeOn a tax equivalent basis, interest
income decreased $17,000 (0.2%) in the first quarter of 2007 compared to the first quarter
of 2006. This is the result of average earning assets decreasing by $3,199,000 (0.7%)
partially offset by an increase on the yield on average earning assets of 3 basis points.

The quarterly average balance of
short term investments, certificates of deposit and securities decreased approximately
$18,011,000 (23.0%) in the first quarter of 2007 as compared with the same period in 2006.
Short term investments have decreased as cashflow from investments was used to fund
commercial loan growth. Partially offsetting the decrease in average balances was an
increase in the yield on these investments of 12 basis points. Loans, which earn a higher
yield than investments, had an increase in average balances of $14,812,000 (4.0%) in the
first quarter of 2007 compared to the same period last year along offset by a 12 basis
point decrease in yield. The Bank has experienced a shift from variable rate commercial
loans to fixed rate commercial loans which has negatively impacted the yield due to the
competitive pricing in the market for these loans and the slope of the yield curve. Due to
competitive pricing pressures on loans and deposits, and to a lesser extent, the high
nonperforming loan balances and increased borrowing costs, our net interest margin has
declined 85 basis points from the same period last year. We expect that net interest
margin will continue to experience compression in 2007.

Interest Bearing
Liabilities/Interest ExpenseInterest expense on deposits for the
first quarter of 2007 increased $874,000 (42.5%) compared to the first quarter of 2006.
This was the result of higher cost of funds due to higher interest rates paid on deposits
of 105 basis points and a shift from demand deposits to higher yielding certificates of
deposit, partially offset by lower average balances of $2,924,000 (0.8%).

Borrowed funds average balance
increased $6,088,000 in the first quarter of 2007 compared to 2006 due to increases in
short term advances from the Federal Home Loan Bank of Indianapolis (FHLBI) and higher fed
funds sold balances. The increase in borrowings is necessary due to lower balances in
deposits and investments more than offset by the need to fund growth in average commercial
loans. As of March 31, 2007, the Bank also had a $1,152,000 loan advance outstanding that
was entered into in 2000 from the FHLBI. Additional FHLBI borrowings are available to fund
future loan growth if needed.

LiquidityLiquidity is monitored by the
Banks Asset/Liability Management Committee (ALCO) which meets at least monthly. The
Board of Directors has approved a liquidity policy which requires the Bank, while it is
well capitalized as defined by the Federal Financial Institutions Examination Council
(FFIEC), to maintain a current ratio of no less than 1:1 (core basic surplus liquidity
equal to 0), representing that the Banks contingency for unexpected funding outflows
is being primarily met by short term investments and unencumbered treasury and agency
securities. Additional requirements of the policy are that when FHLBI available credit is
added to core basic surplus liquidity, the Bank must have liquidity totaling 5% of assets;
and when brokered CDs and Federal Funds lines are added, the Bank must have liquidity
totaling 8% of assets. Should the Banks capital ratios fall below the well
capitalized level, additional liquidity totaling 5% of assets will be required.

Deposits are the principal source of
funds for the Bank. Management monitors rates at other financial institutions in the area
to ascertain that its rates are competitive in the market. Management also attempts to
offer a wide variety of products to meet the needs of its customers. The breakdown of the
Banks Large Certificates, which are generally considered to be more
volatile and sensitive to changes in rates, consist principally of local depositors known
to the Bank. As of March 31, 2007, the Bank had Large Certificates totaling approximately
$96,000,000 compared to $89,000,000 at December 31, 2006.

It is the intention of the
Banks management to handle unexpected liquidity needs through its Federal Funds
position with a correspondent bank and by FHLBI borrowings. The Bank has a line of credit
of approximately $36,000,000 available at the FHLBI. As of March 31, 2007, approximately
$1,200,000 of the line had been used for long term advances, as previously described. The
Bank has pledged certain mortgage loans as collateral for this borrowing. The Bank also
has a repurchase agreement in place where it can borrow from a broker who will lend money
against certain securities of the Bank. Finally, management may look to available
for sale securities in the investment portfolio to meet additional liquidity needs.

10

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Interest Rate RiskInterest rate risk is also addressed
by ALCO. Interest rate risk is the potential for economic losses due to future rate
changes and can be reflected as a loss of future net interest income and/or loss of
current market values. The objective is to measure the effect on net interest income and
to adjust the balance sheet to minimize the inherent risk while, at the same time,
maximizing income. Tools used by management include the standard GAP report which lays out
the repricing schedule for various asset and liability categories and an interest rate
simulation report. The Bank has no market risk sensitive instruments held for trading
purposes. The Bank has not entered into futures, forwards, swaps, or options to manage
interest rate risk. However, the Bank is party to financial instruments with
off-balance-sheet risk in the normal course of business to meet the financing needs of its
customers including commitments to extend credit and letters of credit. A commitment or
letter of credit is not recorded as an asset until the instrument is exercised.

In addition to liquidity and interest
rate risk management issues, ALCO discusses the Banks performance and the current
economic outlook and its impact on the Bank and current interest rate forecasts. Actual
results are compared to budget in terms of growth and income. A yield and cost analysis is
done to monitor interest margin. Various ratios are discussed including capital ratios,
other balance sheet ratios, and profitability ratios.

|Interest Rate Sensitivity as of March 31, 2007   
|-------------------------------------------------
|(in thousands)                                   
|                                                 
|Assets:                                          
|Loans, net                                       
|Securities                                       
|Certificates of deposit                          
|Short term investments                           
|                                                 
|Total rate sensitive assets                      
|                                                 
|Liabilities:                                     
|NOW, savings & MMDA                              
|Time deposits                                    
|Other borrowings                                 
|                                                 
|Total rate sensitive liabilities                 
|                                                 
|Rate sensitivity gap and ratios:                 
|Gap for period                                   
|Cumulative gap                                   
|                                                 
|March 31, 2007 Cumulative rate sensitive ratio   
|December 31, 2006 Cumulative rate sensitive ratio

The preceding table sets forth the
time periods in which earning assets and interest bearing liabilities will mature or may
re-price in accordance with their contractual terms. The entire balance of savings
including MMDA and NOW are not categorized as 0-3 months, although they are variable rate
products. Some of these balances are core deposits and are not considered rate sensitive.
Allocations are made to time periods based on the Banks historical experience and
managements analysis of industry trends.

11

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In the gap table above, the short
term (one year and less) cumulative interest rate sensitivity is liability sensitive as of
March 31, 2007. A liability sensitive position would normally indicate increased net
interest income in a declining rate environment. Gap analysis is limited and may not
provide an accurate indication of the impact of general interest rate movements on the net
interest margin since repricing of various categories of assets and liabilities is subject
to the Banks needs, competitive pressures, and the needs of the Banks
customers. In addition, various assets and liabilities indicated as repricing within the
same period may in fact reprice at different times within the period and at different rate
indices. Additionally, simulation modeling, which measures the impact of upward and
downward movements of interest rates on interest margin, provides meaningful insight into
strategies management can take to help mitigate the movement of interest rates. The model
at March 31, 2007 indicates that a 200 basis point decrease in interest rates would reduce
net interest income, while a 200 basis point increase in interest rates would increase net
interest income. These results are influenced by the assumptions regarding how quickly and
to what extent liabilities will reprice given a change in interest rates.

|Provision for Loan Losses | First Quarter
|------------------------- | -------------
|(in thousands)            |              
|                          |              
|Total                     |              

The Corporation recorded a loan loss
provision of $939,000 in the first quarter of 2007 compared to a provision of $600,000 in
the same period last year. The provision is based upon an analysis of estimated losses
inherent in the portfolio and other economic factors. Non-performing loans at March 31,
2007 have increased $304,000, from December 31, 2006, and increased $6,063,000 from March
31, 2006. Net charge offs for the first quarter of 2007 were $674,000 compared to $366,000
in the same period in 2006.

Management has determined that the
allowance is adequate based on potential losses in the portfolio. At March 31, 2007 the
allowance for loan losses as a percent of loans was 2.01% compared to 1.98% at December
31, 2006 and 1.95% at March 31, 2006. Non-accrual, past due 90 days, and renegotiated
loans were 3.29% of total loans at March 31, 2007, compared to 3.25% at December 31, 2006
and 1.81% at March 31, 2006. Management believes the increase in the allowance is
warranted based on the asset quality concerns and the general economic conditions of the
local market.

Impaired loans, as defined by
Statement of Financial Accounting Standards (SFAS) No. 114, Accounting by Creditors for
Impairment of a Loan, totaled approximately $14,400,000 at March 31, 2007, and
included non-accrual and past due 90 days other than homogenous residential and consumer
loans, and $3,500,000 of commercial loans separately identified as impaired. Impaired
loans totaled $15,500,000 at December 31, 2006 and $10,400,000 at March 31, 2006. A loan
is considered impaired when it is probable that all or part of amounts due according to
the contractual terms of the loan agreement will not be collectable on a timely basis.
Nonperforming loans are reviewed regularly for collectability. Any uncollectable balances
are promptly charged off. Impaired commercial loans had specific reserves calculated in
accordance with SFAS No. 114 of $1,650,000 at March 31, 2007, $1,980,000 at December 31,
2006 and $2,092,000 at March 31, 2006.

The adequacy of the allowance for
loan losses is determined by managements assessment of the composition of the loan
portfolio, an evaluation of specific credits, an analysis of the value of the underlying
collateral for those loans, historical loss experience, relevant economic factors, the
level of nonperforming loans, loans that have been identified as impaired, and the overall
credit quality of the portfolio. Management continues to refine its techniques in this
analysis. Due to the concentration of the Bank in residential real estate development and
construction loans and the continued decline in the Michigan real estate market, the Bank
is particularly focused on this segment of loans.

12

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Nonperforming assets are loans for
which the accrual of interest has been discontinued, accruing loans 90 days or more past
due in payments, and other real estate which has been acquired primarily through
foreclosure and is waiting disposition.

Loans are generally placed on a
nonaccrual basis when principal or interest is past due 90 days or more and when, in the
opinion of management, full collection of principal and interest is unlikely. Loans
categorized as 90 days past due and still accruing are well secured and in the process of
collection. The following table reflects nonperforming assets.

|Nonperforming Assets(in thousands)               | March 31,2007 | December 31,2006 | March 31,2006
|------------------------------------------------ | ------------- | ---------------- | -------------
|                                                 |              
|Nonaccrual loans                                 |               |                  | $            
|90 days or more past due and still accruing      |               |                  |              
|                                                 |               |                  |              
|Total nonperforming loans                        |               |                  |              
|Other real estate owned                          |               |                  |              
|                                                 |               |                  |              
|Total nonperforming assets                       |               |                  | $            
|                                                 |               |                 
|Nonperforming loans as a percent of total loans  |               |                  |              
|Allowance for loan losses as a percent of        |               |                 
|nonperforming loans                              |               |                  |              
|Nonperforming assets as a percent of total loans |               |                 
|and other real estate owned                      |               |                  |              

Nonperforming loans have increased
slightly since December 31, 2006. While there has been a significant increase in
nonperforming loans over the past 12 months, management believes the allowance is adequate
based on our loan-by-loan analysis of the problem loans and the heavy concentration of
real estate secured loans. Management expects the work out of these loans to take some
time, especially given the economic outlook for the state and the Banks relatively
high balances of loans secured by real estate. Economic conditions and the loan portfolio
concentrations may result in sustained high levels of nonperforming loans and may continue
to impact the provision for loan losses. Management continues to make oversight of these
loans a priority and is working diligently to proactively identify and manage problem
credits.

13

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The following table summarizes the
changes in the allowance for loan losses and reserve for unfunded credit commitments for
the first three months of 2007 and 2006 (in thousands):

|Components:                                                     | 2007 | 2006
|--------------------------------------------------------------- | ---- | ----
|                                                                |      |     
|Allowance for loan losses                                       |      |     
|Balance, beginning of year                                      |      |     
|Loans charged off:                                              |      |     
|Real estate mortgage                                            |      |     
|Commerical                                                      |      |     
|Consumer                                                        |      |     
|                                                                |      |     
|Total charge-offs                                               |      |     
|Recoveries to loans previously charged off:                     |      |     
|Real estate mortgage                                            |      |     
|Commerical                                                      |      |     
|Consumer                                                        |      |     
|                                                                |      |     
|Total recoveries                                                |      |     
|                                                                |      |     
|Net loans charged off                                           |      |     
|Additions to allowance charged to operations                    |      |     
|                                                                |      |     
|Balance, end of quarter                                         |      |     
|Reserve for unfunded credit commitments                         |      |     
|Balance, beginning of year                                      |      |     
|Additions (reductions) to reserve charged to operations         |      |     
|                                                                |      |     
|Balance, end of quarter                                         |      |     
|                                                                |      |     
|Total allowance for loan losses and reserve for                 |      |     
|unfunded credit commitments                                     |      |     
|                                                                |      |     
|Ratios:                                                         |      |     
|Net loans charged off (annualized) to average loans outstanding |      |     
|Allowance for loan losses to loans outstanding                  |      |     

|Noninterest Income | First Quarter
|------------------ | -------------
|(in thousands)     |              
|                   |              
|Total              |              

Noninterest income which includes
service charges and other fee income, trust income, gain on sale of loans and other
miscellaneous income decreased $68,000 (6.8%) during the first quarter of 2007 compared to
the same quarter in 2006. Service charges and other fee income decreased $88,000 (9.7%)
during the first quarter of 2007 from the first quarter of 2006 due primarily due to loan
late fees and returned check fees. Trust income increased $20,600 (28.4%) in the first
quarter 2007 compared to the same period last year primarily due to higher assets under
management. Gain on the sale of loans increased $8,000 (69.9%) due to higher volume of
mortgage loans originated for sale. During the first quarter of 2007, $1,389,000 of loans
were sold compared to $768,000 in the same quarter of 2006. Miscellaneous income decreased
$9,000 (87.4%) during the first quarter of 2007 compared to the same quarter in 2006.

|Noninterest Expense | First Quarter
|------------------- | -------------
|(in thousands)      |              
|                    |              
|Total               |              

14

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Noninterest expense decreased
$427,000 (11.0%) in the first quarter of 2007 compared to the same period in 2006.
Salaries and benefits decreased $259,000 (12.1%) in the first quarter of 2007 compared to
the first quarter of 2006 due to decreased profit sharing expense of $301,000 (71.0%) and
group medical expense of $23,000 (25.4%) partially offset by salary increases of $78,000
(6.0%) primarily due to stock grants. Net occupancy cost decreased $12,000 (3.9%) in 2007
compared to 2006 primarily due to the lower building service expenses and building
maintenance expenses. Equipment expenses decreased $23,000 (17.4%) due to lower equipment
maintenance, other equipment expense and depreciation expense in 2007. Professional and
service fees are $24,000 (5.0%) higher in 2007 than in 2006 due to increased accounting
and auditing fees. Computer service fees increased $44,000 (54.4%) due to increased
software maintenance costs. Directors fees increased $19,000 (24.0%) due to more
directors and special committee meetings in 2007. Printing and supplies costs decreased
$20,000 (28.0%) due to timing of expense. Advertising costs decreased $34,000 (31.8%) due
to fewer promotions in 2007. Other expenses decreased $167,000 (35.0%) primarily due to a
decrease in appraisal expense and the partial reversal of an accrual for a legal
settlement which was recorded in the fourth quarter of 2006, and settled for a lesser
amount in the first quarter of 2007. These decreases were partially offset by higher
losses on the sale of two properties in other real estate owned in 2007.

|Income Tax Expense | First Quarter
|------------------ | -------------
|(in thousands)     |              
|                   |              
|Total              |              

Fluctuations in income taxes resulted
primarily from changes in the level of profitability and in variations in the amount of
tax-exempt income. The effective tax rate at March 31, 2007 is 28% compared to 31% at
March 31, 2006. This decrease in the effective tax rate is primarily due to tax exempt
income representing a higher proportion of net income in 2007.

|March 31, 2007                  | December 31, 2006
|------------------------------- | -----------------
|                                |                  
|Stockholders' Equity            |                  
|Ratio of Equity to Total Assets |                  

The Federal Reserve Board provides
guidelines for the measurement of capital adequacy. The Banks capital, as adjusted
under these guidelines, is referred to as risk-based capital. The Banks Tier 1
risk-based capital ratio at March 31, 2007 was 12.10% and the total risk-based capital
ratio was 13.36%. At March 31, 2006, these ratios were 12.93% and 14.19%, respectively.
Minimum regulatory Tier 1 risk-based and total risk-based capital ratios under the Federal
Reserve Board guidelines are 4% and 8%, respectively. The capital guidelines also provide
for a standard to measure risk-based capital to total assets which is called the leverage
ratio. The Banks leverage ratio was 10.55% at March 31, 2007, and 10.72% in 2006.
The minimum standard leverage ratio is 3% but financial institutions are expected to
maintain a leverage ratio of 1 to 2 percentage points above the 3% minimum.

Critical Accounting
PoliciesThe Corporation maintains critical
accounting policies for the allowance for loan losses. Refer to notes 1c and 1d of the
Notes to Consolidated Financial Statements for additional information included in Form
10-K for the year ended December 31, 2006.

15

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Contractual ObligationsAs of March 31, 2007, December 31,
2006, and March 31, 2006, the Bank had outstanding irrevocable standby letters of credit,
which carry a maximum potential commitment of approximately $2,800,000, $3,300,000 and
$3,600,000, respectively. These letters of credit are conditional commitments issued by
the Bank to guarantee the performance of a customer to a third party. The majority of
these letters of credit are short-term guarantees of one year or less, although some have
maturities which extend as long as two years. The credit risk involved in issuing letters
of credit is essentially the same as that involved in extending loans to customers. The
Bank primarily holds real estate as collateral supporting those commitments for which
collateral is deemed necessary. The extent of collateral held on those commitments at
March 31, 2007, December 31, 2006 and March 31, 2006 where there is collateral, is in
excess of the committed amount. A letter of credit is not recorded on the balance sheet
until a customer fails to perform.

Impact of New
Accounting Standards

In September 2006, the FASB issued
Statement No. 157, Fair Value Measurements. The Statement defines fair value,
establishes a framework for measuring fair value in generally accepted accounting
principles, and expands disclosures about fair value measurements. This Statement applies
to other accounting pronouncements that require or permit fair value measurements, the
Board having previously concluded in those accounting pronouncements that fair value is
the relevant measurement attribute. This Statement does not require any new fair value
measurements and is effective for the Corporation beginning January 1, 2008. Management
has not completed its review of the new guidance; however, the effect of the
Statements implementation is not expected to be material to the Corporations
financial statements or results of operations.

In February 2007, the FASB issued
Statement No. 159, The Fair value Option for Financial Assets and Financial
Liabilities. This Statement permits entities to choose to measure eligible items at
fair value at specified election dates. For items for which the fair value option has been
elected, unrealized gains and losses are to be reported in earnings at each subsequent
reporting date. The fair value option is irrevocable unless a new election date occurs,
may be applied instrument by instrument, with a few exceptions, and applies only to entire
instruments and not to portions of instruments. This Statement provides an opportunity to
mitigate volatility in reported earnings caused by measuring related assets and
liabilities differently without having to apply complex hedge accounting. Statement No.
159 is effective for the Corporation beginning January 1, 2008. Management has not
completed its review of the new guidance; however, the effect of the Statements
implementation is not expected to be material to the Corporations results of
operations or financial position.

In July 2006, the FASB issued FASB
Interpretation No. 48, Accounting for Uncertainty in Income Taxes, which is an
interpretation of FASB Statement No. 109, Accounting for Income Taxes. This
Interpretation clarifies the accounting for uncertainty in income taxes recognized in an
enterprises financial statements in accordance with FASB Statement No. 109.This Interpretation prescribes a recognition threshold and measurement attribute for
the financial statement recognition and measurement of a tax position taken or expected to
be taken in a tax return. It also provides guidance on derecognition, classification,
interest and penalties, accounting in interim periods, disclosure, and transition. The
Interpretation was effective for the Corporation beginning January 1, 2007. Management has
adopted the Interpretation and there was no effect on the Corporations results of
operations or financial position.

Item 3. Quantitative
and Qualitative Disclosures About Market Risk

There has been no material change in
the market risk faced by the Corporation since December 31, 2006.

16

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Item 4. Controls and
Procedures

| | (a) | Evaluation
of Disclosure Controls and Procedures.
With
the participation of management, the Corporations chief executive officer and chief
financial officer, after evaluating the effectiveness of the Corporations disclosure
controls and procedures (as defined in Exchange Act Rules 13a  15(e) and 15d 
15(e)) for the period ended March 31, 2007, have concluded that, as of such date, the
Corporations disclosure controls and procedures were effective.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Changes
in Internal Control Over Financial Reporting. 
During
the quarter ended March 31, 2007, there were no changes in the Corporations internal
control over financial reporting that have materially affected, or are reasonably likely
to materially affect, our internal control over financial reporting.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

PART II  OTHER
INFORMATION

Item 1A. Risk Factors

There have been no material changes
from the risk factors previously disclosed in Part I, Item 1A of the Corporations
Form 10-K.

Item 2. Unregistered
Sales of Equity Securities and Use of Proceeds

The following table shows certain
information relating to purchases of common stock for the three-months ended March 31,
2007:

|Period        | Total Number of
Shares Purchased | Average Price
Paid Per Share | Total Number of Shares
Purchased as Part of a
Publicly Announced Program | Maximum Number That
May Yet Be Purchased
Under the Program (1)
|------------- | -------------------------------- | ---------------------------- | ------------------------------------------------------------------------ | --------------------------------------------------------------
|              |                                  |                              |                                                                          |                                                               
|January 2007  |                                  |                              |                                                                          | -                                                             
|February 2007 |                                  |                              |                                                                          | 29,000                                                        
|March 2007    |                                  |                              |                                                                          | 10,000                                                        
|              |                                  |                              |                                                                          |                                                               
|Total         |                                  |                              |                                                                          | 39,000                                                        
|              |                                  |                              |                                                                          |                                                               

|(1) | On August 17, 2006, the Corporations Board of Directors authorized a share
          repurchase program. This repurchase program authorizes the repurchase of up to
          100,000 additional shares of the Corporations common stock and expires
          August 17, 2007.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

17

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Item 6. Exhibits

The following exhibits (listed by
number corresponding to the Exhibit Table as Item 601 in Regulation S-K) are filed with
this report:

| | 31.1 | Certificate
of the Chief Executive Officer of FNBH Bancorp, Inc. pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------

| | 31.2 | Certificate
of the Chief Financial Officer of FNBH Bancorp, Inc. pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------

| | 32.1 | Certificate
of the Chief Executive Officer of FNBH Bancorp, Inc. pursuant to Section 906 of the
Sarbanes-Oxley Act                of 2002 (18 U.S.C. 1350).
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

| | 32.2 | Certificate
of the Chief Financial Officer of FNBH Bancorp, Inc. pursuant to Section 906 of the
Sarbanes-Oxley Act                of 2002 (18 U.S.C. 1350).
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

18

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SIGNATURES

Pursuant to the requirements of the
Securities Exchange Act of 1934, the Registrant has duly caused this Quarterly Report on
Form 10-Q for the quarter ended March 31, 2007 to be signed on its behalf by the
undersigned hereunto duly authorized.

| |  | FNBH BANCORP, INC./s/ Steven T. Walsh
Steven T. WalshPresident and Chief Executive Officer/s/ Janice B. Trouba
Janice B. TroubaChief Financial Officer
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

DATE: May 8, 2007

19

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