SECURITIES 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 June 30, 1999
                                       OR
              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

               For the transition period from ________ to _______

                         Commission file number 0-25752

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

                 MICHIGAN                            38-2869722
        (State or other jurisdiction of           (I.R.S. Employer
        incorporation or organization)            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___

The number of shares outstanding of each of the issuers classes of common stock,
as of the latest  practicable  date:  1,562,768  shares of the Company's  Common
Stock (no par value) were outstanding as of June 30, 1999.
<PAGE>
                                      INDEX


                                                                           Page
                                                                          Number
Part I.   Financial Information (unaudited):

       Item 1.
       Interim Financial Statements:
       Consolidated Balance Sheet as of June 30, 1999 and Dec. 31, 1998........4
       Consolidated Statements of Income, three months ended
       June 30, 1999 and 1998, and six months ended June 30, 1999 and 1998.....5
       Consolidated Statement of Stockholders' Equity and Comprehensive
       Income for six months ended June 30, 1999 and 1998......................6
       Consolidated Statements of Cash Flows for six months ended
         June 30, 1999 and 1998................................................7
         Notes to Interim Consolidated Financial Statements....................8

         Item 2.
         Management's Discussion and Analysis of
         Financial Condition and Results of Operations.........................9

         Item 3.
         Quantitative and Qualitative Disclosures about Market Risk...........20

Part II.  Other Information

         Item 4...............................................................20

         Item 6...............................................................20

         Signatures...........................................................21

                                       2
<PAGE>
                         PART I - FINANCIAL INFORMATION

Item 1.
Financial Statements
Unaudited interim consolidated financial statements follow.

                                       3
<PAGE>
                        FNBH BANCORP, INC. AND SUBSIDIARY
<TABLE>
Consolidated Balance Sheets (unaudited)                                            June 30          December 31
                                                                                      1999                 1998
                                                                                  --------          -----------
<S>                                                                             <C>                <C>
Assets
Cash and due from banks                                                         $  10,361,333      $ 12,304,296
Short term investments                                                             10,069,224        18,934,366
                                                                                   ----------        ----------
   Total cash and cash equivalents                                                 20,430,557        31,238,662

Investment securities held to maturity, net (fair value of $16,957,000
   at June 30, 1999 and $19,066,000 at Dec. 31, 1998)                              16,790,971        18,278,233
Investment securities available for sale, at fair value                            30,628,437        19,765,936
Mortgage-backed securities held to maturity, net (fair value of
   $514,000 at June 30, 1999 and $602,000 at Dec. 31, 1998)                           518,084           601,940
                                                                                      -------           -------
      Total investment securities                                                  47,937,492        38,646,109

Loans:
   Commercial                                                                     153,053,775       137,634,020
   Consumer                                                                        24,347,407        23,064,800
   Real estate mortgages                                                           23,700,445        24,946,777
                                                                                  -----------       -----------
      Total loans                                                                 201,101,627       185,645,597
   Less unearned income                                                               542,138           627,169
   Less allowance for loan losses                                                   4,273,117         3,958,008
                                                                                    ---------         ---------
      Net loans                                                                   196,286,372       181,060,420

Premises and equipment - net                                                        8,311,541         7,289,461
Land available for sale - net                                                       3,048,914         3,128,914
Accrued interest and other assets                                                   3,710,114         3,325,318
      Total assets                                                               $279,724,990      $264,688,884
                                                                                 ============      ============

Liabilities and Stockholders' Equity
Liabilities
Deposits:
   Non-interest bearing demand                                                   $ 52,074,758      $ 47,401,813
   NOW                                                                             27,196,632        29,087,082
   Savings and money market                                                        81,809,534        75,129,137
   Time                                                                            92,762,937        87,938,732
                                                                                   ----------        ----------
      Total deposits                                                              253,843,861       239,556,764

Accrued interest, taxes, and other liabilities                                      1,542,200         1,635,587
                                                                                    ---------         ---------
      Total liabilities                                                           255,386,061       241,192,351

Stockholders' Equity
Common stock, no par value.  Authorized 4,200,000 shares; 1,562,768
shares issued and outstanding at June 30, 1999 and Dec. 31, 1998                    4,821,880         4,821,775
Retained earnings                                                                  19,753,231        18,728,787
Unearned management retention plan                                                    (66,220)          (66,220)
Accumulated other comprehensive income (loss), net                                   (169,962)           12,191
                                                                                    ---------            ------
      Total stockholders' equity                                                   24,338,929        23,496,533
      Total liabilities and stockholders' equity                                 $279,724,990      $264,688,884
                                                                                 ============      ============
</TABLE>
   See notes to interim consolidated financial statements

                                       4
<PAGE>
                        FNBH BANCORP, INC. AND SUBSIDIARY

<TABLE>
Consolidated Statements of Income
Unaudited                                                      Three Months Ended June        Six Months Ended June
                                                                  1999            1998           1999            1998
                                                                  ----            ----           ----            ----
<S>                                                          <C>             <C>            <C>             <C>
Interest income:
   Interest and fees on loans                                $4,437,173      $4,267,024     $8,770,045      $8,268,832
   Interest and dividends on investment securities:
      U.S. Treasury and agency securities                       358,103         383,088        686,020         805,900
      Obligations of state and political subdivisions           204,757         196,705        412,500         386,129
      Other securities                                           16,687          16,822         29,771          16,822
   Interest on short term investments                           115,580          43,541        320,391         109,041
                                                                -------          ------        -------         -------
      Total interest income                                   5,132,300       4,907,180     10,218,727       9,586,724
                                                              ---------       ---------     ----------       ---------

Interest expense:
   Interest on deposits                                       1,951,423       1,796,380      3,888,173       3,552,737
   Other interest expense                                           203           6,156            904           6,822
                                                                    ---           -----            ---           -----
      Total interest expense                                  1,951,626       1,802,536      3,889,077       3,559,559
                                                              ---------       ---------      ---------       ---------

      Net interest income                                     3,180,674       3,104,644      6,329,650       6,027,165

Provision for loan losses                                       210,000         150,000        420,000         300,000
                                                                -------         -------        -------         -------
      Net interest income after provision for loan losses     2,970,674       2,954,644      5,909,650       5,727,165
                                                              ---------       ---------      ---------       ---------

Non-interest income:
   Service charges                                              527,354         400,656        794,692         772,717
   Gain (loss) on sale of loans                                 (49,417)         80,044         10,062         139,474
   Trust income                                                  33,667          17,534         67,954          30,535
   Other                                                         31,517           2,970         26,643           6,370
                                                                 ------           -----         ------           -----
      Total non-interest income                                 543,121         501,204        899,351         949,096
                                                                -------         -------        -------         -------

Non-interest expense:
   Salaries and employee benefits                             1,161,980       1,076,685      2,321,422       2,118,517
   Net occupancy                                                181,316         147,303        347,369         280,208
   Equipment expense                                            185,695         146,665        300,774         261,998
   Fees                                                         111,339          73,118        259,444         124,813
   Printing and supplies                                         80,075          41,498        143,675         107,219
   Michigan Single Business Tax                                  47,300          43,500         98,900          95,500
   Other                                                        579,818         367,588      1,026,968         776,823
                                                                -------         -------      ---------         -------
      Total non-interest expense                              2,347,523       1,896,357      4,498,552       3,765,078
                                                              ---------       ---------      ---------       ---------

Income before federal income taxes                            1,166,272       1,559,491      2,310,449       2,911,183

Federal income taxes                                            343,900         453,000        660,900         858,000
                                                                -------         -------        -------         -------

      Net income                                               $822,372      $1,106,491     $1,649,549      $2,053,183
                                                               ========      ==========     ==========      ==========
Per share statistics*
   Basic EPS                                                     $  .53            $.70          $1.05           $1.30
   Diluted EPS                                                   $  .53            $.70          $1.05           $1.30
   Dividends                                                     $  .20            $.18         $  .40          $  .36
</TABLE>
*Based on 1,562,768 average shares  outstanding during the period ended June 30,
1999 and 1,575,000 average shares  outstanding  during the period ended June 30,
1998. See notes to interim consolidated financial statements.

                                       5
<PAGE>
                        FNBH BANCORP, INC. AND SUBSIDIARY
     Consolidated Statement of Stockholders' Equity and Comprehensive Income
                 For the Six Months Ended June 30, 1999 and 1998
                                   (Unaudited)

<TABLE>
                                                                                          Accumulated Other
                                                                                            Comprehensive
                                                            Common         Retained          Income (loss)
                                                            Stock          Earnings                              Total
<S>                                                        <C>             <C>              <C>                  <C>
Balances at December 31, 1997                              $5,250,000      16,467,201        14,824                21,732,025
Net income                                                                  2,053,183                               2,053,183
Change in unrealized gain(loss) on debt securities
   available for sale, net of tax effect                                                     (4,624)                   (4,624)
Total comprehensive income                                                                                          2,048,559
Cash dividends (36(cent)per share)                                           (567,000)                               (567,000)
                                                           ----------       ---------       -------                 ---------
Balances at June 30, 1998                                  $5,250,000      17,953,384        10,200                23,213,584
                                                           ==========      ==========       =======                ==========
</TABLE>
See notes to interim consolidated financial statements
<TABLE>

                                                                                           Unearned        Accumulated
                                                                                          Management          Other
                                                           Common          Retained        Retention     Comprehensive
                                                           Stock           Earnings           Plan         Income (loss)    Total
<S>                                                        <C>             <C>              <C>           <C>             <C>
Balances at December 31, 1998                              $4,821,775      18,728,787       (66,220)         12,191      23,496,533
Net income                                                                  1,649,549                                     1,649,549
Change in unrealized gain (loss) on debt securities
   available for sale, net of tax effect                                                                   (182,153)       (182,153)
                                                                                                                          ---------
Total comprehensive income                                                                                                1,467,396
Shares issued for employee awards                                 105                                                           105
Cash dividends (40(cent)per share)                                           (625,105)                                     (625,105)
                                                           ----------       ---------       --------       ---------      ----------

Balances at June 30, 1999                                  $4,821,880      19,753,231       (66,220)       (169,962)      24,338,929
                                                           ==========      ==========       ========       =========      ==========
</TABLE>
See notes to interim consolidated financial statements

                                       6
<PAGE>
                        FNBH BANCORP, INC. AND SUBSIDIARY

Consolidated Statements of Cash Flows
<TABLE>
Unaudited                                                                          Six months ended June 30
                                                                                   1999              1998
                                                                                   ----              ----
<S>                                                                             <C>                 <C>
Cash flows from operating activities:
   Net income                                                                    $  1,649,549       $ 2,053,183
   Adjustments to reconcile net income to net cash
    provided by operating activities:
      Provision for loan losses                                                       420,000           300,000
      Depreciation and amortization                                                   319,100           247,042
      Net amortization on investment securities                                        42,615            15,534
      Loss on disposal of equipment                                                    18,360               723
      Gain on sale of loans                                                           (10,062)         (139,574)
      Proceeds from sale of loans                                                   8,244,550        11,276,972
      Origination of loans held for sale                                           (9,086,850)      (11,493,348)
      (Increase) decrease in accrued interest income and other assets                (384,796)          566,476
      Increase (decrease) in accrued interest, taxes, and other liabilities            80,413          (700,975)
                                                                                       ------         ---------
         Net cash provided by operating activities                                  1,292,879         2,126,033
                                                                                    ---------         ---------

Cash flows from investing activities:
   Purchases of available for sale securities                                     (14,167,570)       (2,006,021)
   Proceeds  from maturities and calls of available for sale securities             2,000,000         6,000,000
   Purchases of held to maturity securities                                        (1,587,420)       (2,636,291)
   Proceeds from maturities and calls of held to maturity securities                3,868,000         5,290,000
   Proceeds from mortgage-backed securities paydowns-held to maturity                 277,040            89,878
   Net increase in loans                                                          (14,793,481)      (21,737,473)
   Capital expenditures                                                            (1,359,545)       (5,199,167)
                                                                                  -----------       -----------
         Net cash used in investing activities                                    (25,762,976)      (20,199,074)
                                                                                  ------------      -----------

Cash flows from financing activities:
   Net increase in deposits                                                        14,287,097        13,753,687
   Dividends paid                                                                    (625,105)         (567,000)
                                                                                    ---------         ---------
         Net cash provided by financing activities                                 13,661,992        13,186,687
                                                                                   ----------        ----------

Net decrease in cash and cash equivalents                                         (10,808,105)       (4,886,354)

Cash and cash equivalents at beginning of year                                     31,238,662        18,738,564
                                                                                   ----------        ----------

Cash and cash equivalents at end of period                                        $20,430,557       $13,852,210
                                                                                  ===========       ===========

Supplemental disclosures:
   Interest paid                                                                  $ 4,000,724       $ 3,551,715
   Federal income taxes paid                                                          752,000           915,000
   Loans transferred from other real estate                                                 0           335,713
   Loans charged off                                                                  233,386            66,945
</TABLE>
See notes to interim consolidated financial statements

                                       7
<PAGE>
Notes to Interim Consolidated Financial Statements(unaudited)
The accompanying  unaudited consolidated financial statements have been prepared
in  accordance  with  generally  accepted  accounting   principles  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 generally  accepted  accounting  principles  for complete
financial statements.

1. In the opinion of management of the  Registrant,  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  Registrant  as of June 30,  1999,  and
consolidated  results of  operations  for the three  months and six months ended
June 30, 1999 and 1998 and consolidated cash flows for the six months ended June
30, 1999 and 1998.

2. The results of operations  for the three months and six months ended June 30,
1999 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 Notes to Consolidated  Financial  Statements in the 1998
Annual Report contained in the Registrant's report on Form 10-K filing.

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

5.  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  $2,115,000  at June  30,  1999  and
$1,544,000 at December 31, 1998.  (See  Management's  Discussion and Analysis of
financial condition and results of operations).

6. Basic EPS is computed by dividing net income by the weighted  average  common
shares outstanding.
<TABLE>
-------------------------------------------------------------------------------------------------------
                                                Second Quarter                      Year to Date
-------------------------------------------------------------------------------------------------------
                                          1999              1998              1999              1998
-------------------------------------------------------------------------------------------------------
<S>                                     <C>              <C>               <C>               <C>
Net income                               $822,372        $1,106,491        $1,649,549        $2,053,183
-------------------------------------------------------------------------------------------------------
Shares outstanding (basic)              1,562,768         1,575,000         1,562,768         1,575,000
-------------------------------------------------------------------------------------------------------
Diluted shares                                  0                 0                 0                 0
-------------------------------------------------------------------------------------------------------
   Shares outstanding (diluted)         1,562,768         1,575,000         1,562,768         1,575,000
-------------------------------------------------------------------------------------------------------
Earnings per share:
-------------------------------------------------------------------------------------------------------
   Basic EPS                                 $.53              $.70             $1.05             $1.30
-------------------------------------------------------------------------------------------------------
   Diluted EPS                               $.53              $.70             $1.05             $1.30
-------------------------------------------------------------------------------------------------------
</TABLE>

                                       8
<PAGE>
Item 2.

                      Management's Discussion and Analysis
                of Financial Condition and Results of Operations
                          Interim Financial Statements

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 Company 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.

FNBH Bancorp, Inc. (the Company), 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
Company's  results of operations  for the three months and six months ended June
30, 1999 and 1998,  and also  provides  information  relating  to the  Company's
financial condition, focusing on its liquidity and capital resources.
<TABLE>
Earnings  (in thousands                     Second Quarter                       Year-to-Date
except per share data)                     1999         1998                   1999       1998
                                           ----         ----                   ----       ----
<S>                                      <C>           <C>                    <C>         <C>
Net income                                $822         $1,106                 $1,650      $2,053
Net Income per Share                     $ .53          $ .70                  $1.05       $1.30
</TABLE>
Net income for the three  months  ended June 30,  1999  decreased  approximately
$284,000  (26%) from that  reported  for the same period last year.  The primary
reason for the decline was an increase of $452,000 in non-interest expense. This
increase was primarily  the result of  non-recurring  expenditures  related to a
computer conversion and increased estimated holding costs related to real estate
the Company owns. Partially offsetting these negative factors, were increases in
net interest income and in non-interest  income and a decrease in federal income
taxes.  The increase in net interest  income was the result of overall growth in
the Bank's assets as the net interest margin declined.  Net income for the first
half of the year decreased $403,000 (20%) compared to the same period last year.
Contributing  to this decrease was an increase of $734,000 (19%) in non-interest
expense,  $120,000  (40%) in the loan  loss  provision,  partially  offset by an
increase  of  $303,000  (5%) in net  interest  income and a decrease of $197,000
(23%) in federal tax accruals.

                                       9
<PAGE>
<TABLE>
Net Interest Income                                  Second Quarter                     Year-to-Date
(in thousands)                                      1999         1998                 1999        1998
                                                    ----         ----                 ----        ----
<S>                                               <C>          <C>                   <C>         <C>
Interest Income                                   $5,132       $4,907                $10,219     $9,587
Interest Expense                                   1,952        1,802                  3,889      3,560
                                                 -------       ------                -------     ------
Net Interest Income                              $ 3,180       $3,105                 $6,330     $6,027
</TABLE>
The Company's 1999 second  quarter net interest  income  increased  $75,000 (2%)
when compared with the same period in the prior year,  while net interest income
for the year to date was $303,000  (5%) higher than that of 1998.  The following
table illustrates some of the significant  factors  contributing to the increase
in net interest income for the period and for the year to date.


                                     TABLE 1
                    INTEREST YIELDS AND COSTS (in thousands)
                             June 30, 1999 and 1998
<TABLE>
                                                                             ---------------Second Quarter Averages----------------

                                                       1999                                    1998
                                                       ----                                    ----
                                          Average                                  Average
                                         Balance       Interest       Rate        Balance       Interest       Rate
<S>                                   <C>             <C>             <C>       <C>             <C>            <C>
Assets:
Short term investments                $    10,061     $    114.8      4.52%     $    3,165      $    43.5      5.43%
Securities:  Taxable                       29,821          375.8      5.04%         26,233          399.9      6.10%
             Tax-exempt(1)                 16,487          285.0      6.91%         15,325          272.9      7.12%
Loans(2)(3)                               196,213        4,497.0      9.07%        173,449        4,272.3      9.74%
                                        ---------      ---------                ----------      ---------
Total earning assets/total
interest income                           252,582       $5,272.6      8.27%        218,172       $4,988.6      9.05%
                                                       ---------                                ---------
Cash & due from banks                      11,285                                    9,099
All other assets                           14,750                                   11,090
Allowance for loan loss                    (4,201)                                  (3,656)
                                        ---------                               ----------
   Total assets                          $274,416                                 $234,705
                                        =========                               ==========
Liabilities and
  Stockholders' Equity
Interest bearing deposits:
Savings & NOW accounts                 $  105,078         $692.7      2.64%      $  87,383      $   653.4      3.00%
Time                                       94,108        1,258.7      5.36%         79,830        1,143.0      5.74%
Purchased funds                                11             .2      7.23%            426            6.1      5.66%
                                        ---------      ---------                ----------      ---------
Total interest bearing
liabilities/total interest expense        199,197      $ 1,951.6      3.93%        167,639       $1,802.5      4.31%
                                                       ---------                                ---------
Non-interest bearing deposits              48,806                                   42,277
All other liabilities                       1,980                                    2,003
Stockholders' Equity                       24,433                                   22,786
                                        ---------                               ----------
Total liabilities and
   shareholders' equity                  $274,416                                 $234,705
                                        =========                               ----------
Interest spread                                                       4.34%                                    4.74%
                                                                      =====                                    =====
Net interest income-FTE                                $ 3,321.0                                $ 3,186.1
                                                       =========                                =========
Net interest margin                                                   5.17%                                    5.75%
                                                                      =====                                    =====
</TABLE>
                                       10
<PAGE>
    (1)   Average   yields  in  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
          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 $139,000 in 1999
          and $138,000 in 1998.

<TABLE>
                                                   ----------------Year to Date Averages-----------------
                                                         1999                                  1998
                                                         ----                                  ----
                                          Average                                 Average
                                          Balance       Interest      Rate        Balance      Interest        Rate
<S>                                     <C>           <C>             <C>       <C>            <C>             <C>
Assets:
Short term investments                  $  13,694     $    319.6      4.64%     $    3,991     $   109.0       5.43%
Securities:  Taxable                       28,273          716.5      5.11%         27,402         822.7       6.05%
             Tax-exempt(1)                 16,475          573.8      6.97%         14,964         535.6       7.16%
Loans(2)(3)                               190,346        8,780.6      9.19%        168,341       8,278.4       9.80%
                                         --------     ----------                ----------      --------
Total earning assets/total
interest income                           248,788     $ 10,390.5      8.33%        214,698      $9,745.7       9.06%
                                                      ----------                                --------

Cash & due from banks                      12,299                                    8,718
All other assets                           15,593                                   10,261
Allowance for loan loss                    (4,121)                                  (3,578)
                                         --------                               ----------
   Total assets                          $272,559                               $  230,099
                                         ========                               ==========
Liabilities and
  Stockholders' Equity
Interest bearing deposits:
Savings & NOW accounts                   $105,773     $  1,406.1      2.68%     $   86,893      $1,289.9       2.99%
Time                                       92,734        2,482.1      5.40%         79,058       2,262.9       5.77%
Purchased funds                                37             .9      4.86%            237           6.8       5.73%
                                         --------     ----------                ----------      --------
Total interest bearing
liabilities/total interest expense        198,544     $  3,889.1      3.95%        166,188      $3,559.6       4.32%
                                                      ----------                                --------
Non-interest bearing deposits              48,154                                   39,462
All other liabilities                       1,731                                    1,979
Stockholders' Equity                       24,130                                   22,470
                                         --------                               ----------
Total liabilities and
  shareholders' equity                   $272,559                                $ 230,099
                                         ========                               ==========
Interest spread                                                       4.38%                                    4.74%
                                                                      =====                                    =====
Net interest income-FTE                               $  6,501.4                                $6,186.1
                                                      ==========                                ========
Net interest margin                                                   5.18%                                    5.71%
                                                                      =====                                    =====
</TABLE>
    (1)   Average   yields  in  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
          Standards No. 115.
    (2)   For  purposes  of  the  computations  above,  non-accruing  loans  are
          included in the average daily loan balances.
    (3)   Interest on loans includes  origination fees totaling $268,000 in 1999
          and $291,000 in 1998.

                                       11
<PAGE>
Interest Earning Assets/Interest Income
On a tax equivalent basis, interest income increased  approximately  $284,000 in
the second quarter of 1999 compared to that of 1998. A $23,000,000  (13%) growth
in average loan balances led to the net interest income growth.  The rate earned
on loans  declined 67 basis points.  Contributing  to the decline in yield was a
decrease in the Bank's prime  lending  rate of 75 basis  points which  continued
until July 1 when it increased 25 basis points.

In the second quarter,  tax equivalent income on short and long term investments
increased  because the average balance increased  $11,600,000  although the rate
earned  decreased  90 basis  points.  The 26%  increase in  investment  balances
compared to the 13% growth in loans  contributed to the overall decline in rates
on earning assets as the lower yielding investment portfolio absorbed the excess
deposit growth which the loan portfolio could not utilize.

For the  first  half of the  year,  tax  equivalent  interest  income  increased
$645,000.  Again,  the  increase  was  primarily  attributable  to growth.  Loan
interest income increased  $500,000,  with average balances up $22,000,000 while
yields declined 61 basis points.  The growth in the loan portfolio was primarily
in commercial  loans which  increased 20% on average.  The lack of growth in the
mortgage loan  portfolio is  attributable  to the Bank's policy of selling fixed
rate  mortgage  loans.  New  nonconforming  variable rate  mortgages,  which are
retained in the loan portfolio, have not kept up with mortgage loan run off. The
Bank sold approximately $7,700,000 mortgage loans to the secondary market during
the first half of 1999.

For the first six months of the year,  income on short and long term investments
increased $143,000 from that earned the prior year due to a $12,000,000 increase
in average balances although the yields decreased by 84 basis points.

Interest Bearing Liabilities/Interest Expense
In the second quarter of 1998,  interest  expense  increased  $149,000 due to an
increase in average  balances of  $31,600,000  although the  interest  rate paid
declined 38 basis points.  Savings and NOW interest  expense  increased  $39,000
because balances increased  $17,700,000 although rates declined 36 basis points.
Interest on time deposits  increased $116,000 in the second quarter of 1999 over
the prior year.  Balances increased  $14,300,000  although the rate paid on time
deposits  decreased 38 basis points compared to that of 1998. The deposit growth
was the  result  of the  Bank's  marketing  efforts  to  increase  its  share of
Livingston  County  deposits.  Deposit  rates are set  based on market  studies.
Special rates are offered from time to time to meet rate sensitivity  goals. The
decline  in  deposit  rates  was not as  significant  as that  earned  on assets
resulting in a decline in the interest margin.

In the first half of the year,  interest  expense was $330,000  higher than 1998
due to average balances of interest bearing liabilities  increasing  $32,400,000
although the average  rate  declined 37 basis  points.  Savings and NOW interest
expense increased

                                       12
<PAGE>
$116,000  because  balances  increased  $19,900,000  although the interest  rate
decreased 31 basis points.  Interest on time deposits increased $229,000 because
the balance increased $13,700,000 although the rate decreased 37 basis points.

Liquidity
Liquidity is monitored by the Bank's Asset/Liability Management Committee (ALCO)
which  meets  at least  monthly.  ALCO  developed,  and the  Board of  Directors
approved, a liquidity policy which targets a 15% liquidity ratio. As of June 30,
the Bank's liquidity ratio was 19.33%.

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 Bank  does not deal in
brokered funds, and the makeup of its over $100,000 certificates, which amounted
to  $22,400,000  at June 30, 1999 compared to  $18,000,000 at December 31, 1998,
consists of local depositors known to the Bank.

It is the  intention of the Bank's  management  to handle  unexpected  liquidity
needs  through its Federal Funds  position.  The goal is to maintain a daily Fed
Funds balance sufficient to cover required cash draws.  During the first half of
the year, short term investments averaged approximately $13,700,000.  Because of
the relatively flat yield curve and the unfavorable  investing atmosphere in the
second half of 1998,  proceeds  from some matured  Treasury  bonds were invested
short  term with the  Federal  Home Loa Bank of  Indianapolis.  These  funds are
available on call and add to the Bank's  liquidity  position.  In addition,  the
Bank has a  $13,000,000  line of credit  available  at the FHLB and the Bank has
pledged certain mortgage loans and investment  securities as collateral for this
borrowing. In the event the Bank must borrow for an extended period,  management
may look to  "available  for sale"  securities in the  investment  portfolio for
liquidity. Management has decided to maintain higher than usual liquidity ratios
this year to meet any cash needs related to Year 2000 customer demand.

In addition to liquidity 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 and liquidity.

Interest  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 asse and liability categories and an interest
rate shock simulation report. The Bank has no market risk sensitive  instruments
held for trading purposes. The Bank does not enter into futures,

                                       13
<PAGE>
forwards, swaps, or options to manage interest rate risk. However, the Bank is a
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.
<TABLE>
Interest Rate Sensitivity
(dollars in thousands)                              0-3           4-12            1-5            5+
                                                  Months         Months          Years         Years          Total
<S>                                              <C>            <C>            <C>           <C>           <C>
Assets:
   Loans.................................        $58,812        $30,839        $97,586       $13,865       $201,102
   Securities............................            933         13,266         22,568        11,170         47,937
   Fed funds.............................         10,069                                                     10,069
   Other assets..........................                                                     20,902         20,902
                                                 -------        -------       --------        ------         ------
      Total assets.......................        $69,814        $44,105       $120,154       $45,937       $280,010

Liabilities & Stockholders' Equity:
   Demand, Savings & NOW.................        $47,325        $17,095        $63,981       $32,680       $161,081
   Time..................................         38,981         23,249         30,518            15         92,763
   Other liabilities and equity..........                                                     26,166         26,166
                                                 -------        -------        -------        ------         ------
      Total liabilities and equity.......        $86,306        $40,344        $94,499       $58,861       $280,010

Rate sensitivity gap and ratios:
   Gap for period........................      $ (16,491)        $3,761        $25,655      $(12,924)
   Cumulative gap........................        (16,491)       (12,731)        12,924

Cumulative rate sensitive ratio..........            .81            .90           1.06          1.00
Dec. 31, 1998 rate sensitive ratio.......           1.28            .92           1.08          1.00
</TABLE>
Given the liability sensitive position of the Bank at June 30, 1999, if interest
rates  increase 200 basis  points and  management  did not  respond,  management
estimates  that  annualized  net interest  income would  decrease  approximately
$260,000,  while a similar  decrease in rates would cause net interest income to
increase  by a like  amount.  In the  preceding  table,  the  entire  balance of
savings,  MMDA,  and NOW are not  categorized  as 0-3 months,  although they are
variable rate  products.  Some of these  balances ar core deposits which are not
considered rate sensitive based on the Bank's historical experience and industry
practice.
<TABLE>
Provision for Loan Losses                      Second Quarter                              Year-to-Date
(in thousands)                               1999         1998                          1999        1998
                                             ----         ----                          ----        ----
         <S>                                 <C>          <C>                          <C>         <C>
         Total                               $210         $150                         $420        $300
                                             ====         ====                         ====        ====

The provision for loan losses  increased  $60,000 in the second  quarter of 1999
compared to the prior year.  Year to date the provision has increased  $120,000.
The increase in the loan loss provision was deemed  appropriate  principally due
to the 20% growth in commercial  loans.  In June of 1999, the allowance for loan
loss as a percent of loans was 2.12%, compared to 2.05% a year earlier and 2.13%
at December 31, 1998.  For the first

                                       14
<PAGE>
six  months of 1999,  the Bank had net  charge  offs of  $105,000,  compared  to
$21,000  in  the  first  half  of  1998.  Non-accrual,  past  due 90  days,  and
renegotiated  loans were 1.05% and .58% of total loans  outstanding  at June 30,
1999 and 1998 respectively and .83% of total loans at December 31, 1998.

Impaired  loans, as defined by Statement of Financial  Accounting  Standards No.
114,  Accounting by Creditors for  Impairment of a Loan,  totaled  approximately
$5,100,000  at June 30, 1999,  compared to  $4,300,000  at December 31, 1998 and
included non-accrual, and past due 90 days other than homogenous residential and
consumer loans, and, at June 30, 1999, $3,100,000 of commercial loans separately
identified as impaired.  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 be uncollectable on a timely basis.  Approximately  $4,200,000 of
the impaired balance relates to three  borrowers.  These loans are considered by
management  to be well  collateralized.  One of the  loans,  for  $2,400,000  is
current  and  making  regular  payments  but  was put on the  watch  list in its
construction  phase. The other two loans are in the process of foreclosure.  Any
loss that might occur from these loans is not expected to have a material impact
on the Company's financial condition or results of operations.

Management  assessment  of  the  allowance  for  loan  losses  is  based  on the
composition of the loan portfolio, an evaluation of specific credits, historical
loss  experience,  the level of  nonperforming  loans  and loans  that have been
identified as impaired. Externally, the local economy and events or trends which
might negatively impact the loan portfolio are also considered. Certain impaired
loans  with  a  balance  of  $5,100,000  had  specific  reserves  calculated  in
accordance with SFAS No. 114 of $630,000 at June 30, 1999.

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. The following table describes nonperforming assets at June 30, 1999
compared to December 31, 1998. The loans categorized as ninety days past due are
all well secured and in the process of collection.
<PAGE>
Nonperforming Assets                                           Quarter Ended             Year Ended
(in thousands)                                                 June 30, 1999          December 31, 1998
                                                               -------------          -----------------
<S>                                                            <C>                       <C>
Non-accrual loans                                                $2,102                   $1,519
90 days or more past due and still accruing                          13                       25
                                                                 ------                   ------
         Total nonperforming loans                                2,115                    1,544
Other real estate                                                     0                        0
                                                                 ------                   ------
         Total nonperforming assets                              $2,115                   $1,544

Nonperforming loans as a percent of total loans                   1.05%                     .83%
Nonperforming assets as a percent of total loans                  1.05%                     .83%
Loan loss reserve to nonperforming loans                           202%                     256%
</TABLE>
                                       15
<PAGE>
Nonperforming  loans  have  increased  in 1999  compared  to the end of the year
primarily  due to the  addition of one large loan for  $800,000  to  non-accrual
loans. This loan is in foreclosure and will likely be redeemed before the end of
the year.  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

The following  table sets forth loan balances and  summarizes the changes in the
allowance for loan losses for the first six months of 1999 and 1998.
<TABLE>
                                                                       Year to date           Year to date
Loans:   (dollars in thousands)                                        June 30, 1999          June 30, 1998
<S>                                                                       <C>                    <C>
   Average daily balance of loans for the year to date                    190,346                168,341
   Amount of loans (gross) outstanding at end of the
   quarter                                                                201,102                181,075
Allowance for loan losses:
   Balance at beginning of year                                             3,958                  3,424
   Loans charged off:
      Real estate                                                               0                      0
      Commercial                                                              158                      18
      Consumer                                                                 75                     49
                                                                               --                     --
         Total charge-offs                                                    233                      67

   Recoveries of loans previously charged off:
      Real estate                                                              35                       0
      Commercial                                                               65                     13
      Consumer                                                                 28                     33
                                                                               --                     --
         Total recoveries                                                     128                      46

Net loans charged off                                                         105                      21
Additions to allowance charged to operations                                  420                    300
                                                                              ---                 ---
         Balance at end of quarter                                         $4,273                 $3,703

Ratios:
    Net loans charged off (annualized) to average
    loans outstanding                                                         .11%                  .02%
   Allowance for loan losses to loans outstanding                            2.12%                  2.05%
</TABLE>

<TABLE>
Non-interest Income                                        Second Quarter                             Year-to-Date
(in thousands)                                           1999          1998                        1999          1998
                                                         ----          ----                        ----          ----
<S>                                                      <C>           <C>                         <C>           <C>
Total                                                    $543          $501                        $899          $949
                                                         ====          ====                        ====          ====
</TABLE>
Non-interest  income,  which includes service charges on deposit accounts,  loan
fees, trust fees, other operating income,  and gain (loss) on sale of assets and
securities transactions, increased by $42,000 (8%) in the second quarter of 1999
compared to the same period in the previous year. The most significant  increase
was in service charges on deposits and

                                       16
<PAGE>
loans which  increased  $127,000 as the Bank  recovered  service  charges in the
second quarter which had not been collected in the first quarter due to computer
conversion  problems.  Additionally,  trust fees doubled due to seasoning of the
Trust Department which has now been operating for nearly two years. Other income
was up for the quarter due to a gain on the sale of repossessed property. Partly
offsetting  these increases was a decrease of $129,000 in income related to loan
sales.  This  decrease was a result of reduced  loan volume and rising  interest
rates.

For the year, non-interest income decreased $50,000 (5%). The decline was due to
the loss on loan sales which  resulted in $129,000  less income in 1999 compared
to the previous year.

<TABLE>
Non-interest Expense                                        Second Quarter                          Year-to-Date
(in thousands)                                            1999          1998                      1999          1998
                                                          ----          ----                      ----          ----
<S>                                                       <C>           <C>                      <C>          <C>
Total                                                     $2,348       $1,896                   $4,499        $3,765
                                                          ======       ======                   ======        ======
</TABLE>
Non-interest  expense  increased  $452,000  (24%) in the second  quarter of 1999
compared to the same period last year.  All categories of  non-interest  expense
increased.  Salaries and benefits  increased  $85,000 due to the hiring of staff
for the new  branch  opening  in the  third  quarter  as well as  normal  salary
increases.  Occupancy  increased  $34,000 primarily due to property tax accruals
for the new branch and adjacent land to be sold. Equipment expense increased due
to increased  depreciation  costs related to the purchase of computer  equipment
and programs.  Fees increased  $38,000  primarily due to costs  associated  with
converting paper records to CDs. Printing and supplies  increased $39,000 due to
new forms and media required for the computer  network.  Other expense increased
$212,000  due to costs  related  to having to  outsource  certain  systems  on a
temporary basis,  increased telephone costs related to the computer network, and
increased estimated holding cost and/or sale cost pertaining to real estate held
fo sale.

For the first half of the year, non-interest expense increased $734,000 (19%) in
all of the  above  mentioned  categories.  Building  expenses  are  expected  to
increase  as the  year  progresses  and the new  branch  in  Brighton  is put in
service.
<TABLE>
Income Tax Expense                                           Second Quarter                             Year-to-Date
(in thousands)                                              1999         1998                         1999        1998
                                                            ----         ----                         ----        ----
         <S>                                                <C>          <C>                          <C>         <C>
         Total                                              $344         $453                         $661        $858
                                                            ====         ====                         ====        ====
</TABLE>
Fluctuations  in income taxes  resulted  primarily  from changes in the level of
profitability and in variations in the amount of tax-exempt income.

                                       17
<PAGE>
<TABLE>
Capital (in thousands)                                June 30, 1999                     December 31, 1998
<S>                                                     <C>                                  <C>
Stockholders' Equity*                                   $24,509                               $23,484
Ratio of Equity to Total Assets                           8.75%                                 8.87%
</TABLE>

*Amounts exclude securities  valuation  adjustments  recorded under Statement of
Financial  Accounting Standards No. 115 amounting to ($170,000) at June 30, 1999
and $12,000 at December 31, 1998.

A financial institution's capital ratio is looked upon by the regulators and the
public as an indication of its soundness.  Stockholders'  equity,  excluding the
securities valuation adjustment, increased $1,025,000 (4%) during the first half
of the year.  This  increase was the result of net income  earned by the company
reduced by dividends paid of $625,000.

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 June 30,
1999 was 9.81%, and total risk-based  capital was 11.06%. At June 30, 1998 these
ratios were 10.78% and 12.03% 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 7.47% at June 30,  1999 and 8.15% in 1998.  The  minimum  standard  leverage
ratio is 3% but financial institutions are expected to maintain a leverage ratio
1 to 2 percentage points above the 3% minimum.

In 1998 the Company  exercised an option to purchase an 18 acre tract of land in
northwest  Brighton primarily to acquire a prime site for a new branch. The cost
of the property was approximately $4,000,000. Approximately $800,000 of the cost
has been  allocated to a branch site.  The Company is  currently  marketing  the
remaining  acreage  which  is  not  needed  for  the  branch.  A road  has  been
constructed  on the property.  Any  additional  improvements  that are needed to
enhance the salability of the property are not expected to exceed $200,000.

Construction of the new branch is nearly  complete.  Land and building will cost
approximately   $2,000,000  with  an  additional   $500,000  for  furniture  and
equipment. The branch is expected to be open in the third quarter.  Additionally
the  Bank  has  purchased  land  in  Howell  for  another  branch  at a cost  of
approximately  $250,000.   These  projects  will  be  financed  from  internally
generated funds.


Year 2000
Year 2000 issues are an important focus of management's  attention.  The Company
is highly  dependent on  technology  and most bank products are dependent on the
software's

                                       18
<PAGE>
ability to make the transition to the Year 2000.  Preparation  for the Year 2000
problem began three years ago when a technology  plan was drafted.  Although the
plan identified ten major technology initiatives to be completed in two to three
years,  the Year 2000  project  was  given  first  priority  and  efforts  began
immediately.  A national ban consulting firm was hired to help prepare an action
plan. The engagement included management education, an inventory of all systems,
risk assessment, an action plan, and a project schedule.

A  steering  committee,   comprised  of  ten  key  employees   representing  all
departments of the Bank,  worked on the action plan. The objective was to ensure
that any system used by the company that relies on dates will not be affected by
the Year 2000  problem,  not only  computers  but power  systems,  vault timers,
elevators,  etc.  The plan  consisted  of five  phases:  awareness,  assessment,
renovation,  validation,  and  implementation.  All phases are  complete and the
Company's computer systems are deemed to be Year 2000 compliant.

The Company spent approximately $1,500,000 on new hardware and software in 1998.
During the first quarter of 1999, the Company spent  approximately  $100,000 for
Year 2000 testing.  However, in spite of thorough testing,  the Company can give
no guarantee that the systems of other service  providers,  on which the Company
relies, will be fully compliant. The Company has developed a contingency plan to
address Year 2000 issues.

The committee also  recognizes that the Company has  relationships  with vendors
and customers which are important to the smooth functioning of its business.  As
a result, the Company has analyzed  significant  vendors and customers Year 2000
readiness and has determined that any failures they may have are not expected to
have a material effect on the Company.

Accounting Standards
In June 1998, the FASB issued  Statement of Financial  Accounting  Standards No.
133,  Accounting for Derivative  Instruments and Hedging  Activities (SFAS 133).
SFAS  133  establishes   accounting  and  reporting   standards  for  derivative
instruments and hedging activities.  It requires  recognition of all derivatives
as either  assets or  liabilities  in the  statement of financial  condition and
measurement  of those  instruments  at fair value.  the accounting for gains and
losses on  derivatives  depends  on the  intended  use of the  derivative.  This
Statement is effective for all fiscal  quarters of fiscal years  beginning after
June 15, 2000, with earlier application  encouraged.  Retroactive application is
not  permitted.  SFAS 133 is not  expected to have a  significant  impact on the
financial condition or operations of the Corporation.

In  June  1999,  the  FASB  issued  SFAS  No.  137,  Accounting  for  Derivative
Instruments  and Hedging  Activites - Deferral of the Effective Date of FASB no.
133.  Statement 137 extends the effective date to fiscal years  beginning  after
June 15, 2000. Entities who have already adopted Statement 133 are not permitted
to revert back to pre-Statement 133 accounting.

                                       19
<PAGE>
Item 3.  Quantitative and Qualitative  Disclosures About Market Risk
No material  changes in the market risk faced by the Company has occurred  since
December 31, 1998.

                          PART II - OTHER INFORMATION

Item 4.  Submission of Matters to a Vote of Security Holders
The registrant's  annual meeting of stockholders was held on April 21, 1999. The
stockholders voted on the election of directors.

Votes were cast as follows for the four nominees for the office of director.

Term expiring in 2002:
                            Shares voted for                Shares voted against
    Charles N. Holkins             1,079,508                               7,000
    Dona Scott Laskey              1,034,104                              52,404
    James R. McAuliffe             1,086,508                                   0
    R. Michael Yost                1,085,108                               1,400

Additionally, the following directors continue in office.

Term expiring in 2000:
         Gary R. Boss
         Donald K. Burkel
         Harry E. Griffith

Term expiring in 2001:
         W. Rickard Scofield
         Randolph E. Rudisill
         Barbara D. Martin


Item 6.  Exhibits and Reports on Form 8-K

(a)  Exhibits
      There are none applicable.

(b)  Reports on Form 8-K:
      There were no reports on Form 8-K filed during the second quarter of 1999.

                                       20
<PAGE>
                                   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 June 30, 1999 to be signed on its behalf by the undersigned  hereunto duly
authorized.


                  FNBH BANCORP, INC.



                  ____________________________________________
                  Barbara D. Martin
                  President and Chief Executive Officer




                  /s/ Barbara J. Nelson
                  Barbara J. Nelson
                  Treasurer



DATE:  August 10, 1999