<PAGE>
 

                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                         ----------------------------


                                  FORM 10-QSB



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

     For the quarterly period ended December 31, 1998


                                       OR

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

     For the transition period from _________  to  _________



                            WEST TOWN BANCORP, INC.
                            -----------------------
       (Exact name of small business issuer as specified in its charter)


       United States                                       36-3785272
       -------------                                     ---------------
(State or other jurisdiction                             I.R.S. Employer
    of incorporation or                                  Identification
       organization)                                         Number



4852 WEST 30TH STREET, CICERO, ILLINOIS                       60804
---------------------------------------                    ----------
(Address of Principal executive offices)                   (Zip Code)

Issuer's telephone number, including area code:          (708) 652-2000
                                                         --------------

     Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15 (d) of the Exchange Act during the past 12 months (or for such
shorter period that the issuer was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.

                    Yes    X      No
                        --------     --------


     Transitional Small Business Disclosure Format

                    Yes           No    X
                        --------     --------
  
     As of January 29, 1999, the issuer had 222,603 shares of Common stock
issued and outstanding.
<PAGE>
 

                            WEST TOWN BANCORP, INC.
                               AND SUBSIDIARIES
                               ----------------


Part I.   FINANCIAL INFORMATION                                             PAGE
                                                                            ----


     Item 1.  Financial Statements
               Consolidated Statements of Financial Condition
               December 31, 1998 (unaudited) and March 31, 1998               3

               Consolidated Statements of Income, Three and
               Nine Months Ended December 31, 1998 and 1997 (unaudited)       4

               Consolidated Statements of Stockholders' Equity
               Nine Months Ended December 31, 1998 (unaudited)                5

               Consolidated Statements of Cash Flows, Nine
               Months Ended December 31, 1998 and 1997 (unaudited)            6

               Notes to Financial Statements                                 7-8

     Item 2.  Management's Discussion and Analysis or Plan of
              Operation                                                     9-11

Part II.  OTHER INFORMATION                                                  12

          Signatures                                                         13

          Index to Exhibits                                                  14

          Earnings Per Share Analysis (Exhibit 11)                           15
  
                                      -2-
<PAGE>
 
                            WEST TOWN BANCORP, INC.
                                AND SUBSIDIARIES
                                ----------------
                 Consolidated Statements of Financial Condition

<TABLE>
<CAPTION>
                                                        December 31,   March 31,
                                                        -------------  ----------
                                                            1998          1998
                                                        -------------  ----------
Assets                                                   (unaudited)
------
<S>                                                     <C>            <C>

Cash and amounts due from depository institutions        $   229,524      302,484
Interest-bearing deposits                                  7,546,436    6,875,094
                                                         -----------   ----------
   Total cash and cash equivalents                         7,775,960    7,177,578
U.S. Government and agency obligations
  (fair value: March 31, 1998 - $498,000)                          -      500,000
Mortgage-backed securities
  (fair value: December 31, 1998 - $1,102,000;
  March 31, 1998 - $1,646,000)                             1,081,506    1,631,621
Loans receivable (net of allowance for
  loan losses: December 31, 1998 - $50,671;
  March 31, 1998 - $46,171)                               19,577,705   18,451,630
Stock in Federal Home Loan Bank of Chicago                   177,400      177,400
Other investments, available for sale, at fair value         268,750      100,000
Accrued interest receivable                                  243,401      201,047
Office properties and equipment - net                        472,498      202,365
Prepaid expenses and other assets                            489,017    1,103,875
                                                         -----------   ----------

   Total assets                                           30,086,237   29,545,516
                                                         ===========   ==========

Liabilities and Stockholders' Equity
------------------------------------
Liabilities
-----------

Deposits                                                  25,494,518   25,263,850
Advance payments by borrowers for taxes and insurance         78,180       34,550
Other liabilities                                            304,342      199,298
                                                         -----------   ----------
   Total liabilities                                      25,877,040   25,497,698
                                                         -----------   ----------

Stockholders' Equity
--------------------

Preferred stock, $.01 par value; authorized
  100,000 shares; none outstanding                                 -            -
Common stock, $.01 par value; authorized
  400,000 shares; 231,928 shares issued and
  222,703 shares outstanding at December 31, 1998 and
  224,303 shares outstanding at March 31, 1998                 2,319        2,319
Additional paid-in capital                                 1,989,276    1,987,127
Retained earnings, substantially restricted                2,407,768    2,279,662
Unrealized gain on securities available for sale,
  net of income taxes                                         44,032            -
Treasury stock, at cost (9,225 shares at 
  December 31, 1998 and 7,625 shares at
  March 31, 1998)                                           (105,906)     (81,906)
Common stock acquired by Employee Stock Ownership Plan      (128,292)    (139,384)
                                                         -----------   ----------

   Total stockholders' equity                              4,209,197    4,047,818
                                                         -----------   ----------

   Total liabilities and stockholders' equity            $30,086,237   29,545,516
                                                         ===========   ==========
</TABLE>

See accompanying notes to consolidated financial statements.

                                      -3-
<PAGE>
 

                            WEST TOWN BANCORP, INC.
                               AND SUBSIDIARIES
                               ----------------

                       Consolidated Statements of Income

<TABLE>
<CAPTION>
                                           Three Months Ended   Nine Months Ended
                                              December 31,         December 31,
                                           ------------------  --------------------
                                             1998      1997      1998       1997
                                             ----      ----      ----       ----
                                              (unaudited)          (unaudited)
<S>                                        <C>        <C>      <C>        <C>
Interest income:
  Loans                                    $364,989   368,492  1,120,663  1,017,164
  Mortgage-backed securities                 18,764    30,161     65,363     99,580
  Investment securities                       1,537     9,073     10,330     30,245
  Interest-bearing deposits                 104,540    89,563    328,852    260,430
  Dividends on FHLB stock                     2,939     3,130      8,855      9,040
                                           --------   -------  ---------  ---------
    Total interest income                   492,769   500,419  1,534,063  1,416,459
                                           --------   -------  ---------  ---------

Interest expense:
  Deposits                                  309,270   310,248    937,140    859,259
                                           --------   -------  ---------  ---------

    Net interest income before
      provision for loan losses             183,499   190,171    596,923    557,200
Provision for loan losses                     1,500     1,500      4,500      4,500
                                           --------   -------  ---------  ---------
    Net interest income after
      provision for loan losses             181,999   188,671    592,423    552,700
                                           --------   -------  ---------  ---------

Non-interest income:
  Loan fees and service charges               2,513     3,861      6,531      7,289
  Rental income                               2,430     2,230      7,290      5,970
  Deposit related fees and other income       5,278     3,394     15,950     10,992
                                           --------   -------  ---------  ---------
    Total non-interest income                10,221     9,485     29,771     24,251
                                           --------   -------  ---------  ---------

Non-interest expense:
  Staffing costs                             77,017    72,335    227,634    226,802
  Advertising                                 4,038     5,746      9,255     11,181
  Occupancy and equipment expense            22,710    18,708     65,866     54,382
  Data processing                            12,320     9,865     35,996     28,287
  Federal deposit insurance premiums          3,677     3,685     11,426     10,910
  Legal, audit and examination fees          11,369    15,643     41,787     44,411
  Other                                      10,976    11,987     32,224     37,869
                                           --------   -------  ---------  ---------
    Total non-interest expense              142,107   137,969    424,188    413,842
                                           --------   -------  ---------  ---------

Income before income taxes                   50,113    60,187    198,006    163,109

Provision for income taxes                   16,058    22,872     69,900     58,254
                                           --------   -------  ---------  ---------

    Net income                             $ 34,055    37,315    128,106    104,855
                                           ========   =======  =========  =========

Earnings per share - basic                 $    .16       .18        .61        .49
                                           --------   -------  ---------  ---------
Earnings per share - diluted               $    .16       .18        .60        .49
                                           --------   -------  ---------  ---------

Dividends declared per common share        $    -         -          -          -
                                           --------   -------  ---------  ---------
</TABLE>

See accompanying notes to consolidated financial statements.

                                      -4-
<PAGE>

                            WEST TOWN BANCORP, INC.
                                AND SUBSIDIARIES
                                ----------------

           Consolidated Statements of Changes in Stockholders' Equity

                      Nine Months Ended December 31, 1998
                                ----------------

                                  (Unaudited)

<TABLE>
<CAPTION>

                                                                        Accumulated                 Common
                                               Additional                  Other                    Stock
                                     Common      Paid-In     Retained  Comprehensive   Treasury     Awarded
                                     Stock      Capital      Earnings     Income        Stock       by ESOP      Total
                                   ---------  -----------   ---------  -------------  ---------     --------   ---------
<S>                                 <C>        <C>          <C>        <C>            <C>           <C>        <C> 
                                                                                      
Balance at March 31, 1998           $  2,319   1,987,127     2,279,662            -     (81,906)    (139,384)  4,047,818
                                                                                      
Additions for the nine months                                                         
 ended December 31, 1998:                                                             
                                                                                      
Comprehensive income:                                                                 
  Net income                                                   128,106                                           128,106
  Other comprehensive income,                                                         
   net of tax:                                                                        
    Unrealized holding gain                                                           
     during the period                                                       44,032                               44,032
                                    --------   ---------     ---------      -------     --------     --------  ---------
  Comprehensive income                                         128,106       44,032                              172,138
                                                                                      
  Purchase of treasury stock                                                          
   (1,600 shares)                                                                        (24,000)                (24,000)
  Contribution to fund ESOP loan                   2,149                                               11,092     13,241
                                    --------   ---------     ---------       ------     --------     --------  ---------
                                                                                      
Balance at December 31, 1998        $  2,319   1,989,276     2,407,768       44,032     (105,906)    (128,292) 4,209,197
                                    ========   =========     =========       ======     ========     ========  =========

 
</TABLE>



See accompanying notes to consolidated financial statements.

                                      -5-
<PAGE>
 

                            WEST TOWN BANCORP, INC.
                               AND SUBSIDIARIES
                               ----------------

                     Consolidated Statement of Cash Flows

<TABLE>
<CAPTION>
                                                                    Nine Months Ended
                                                                       December 31,
                                                                --------------------------
                                                                   1998            1997
                                                                   ----            ----
                                                                       (unaudited)
<S>                                                             <C>             <C>
Cash flows from operating activities:

  Net income                                                    $   128,106        104,855
    Adjustments to reconcile net income to net cash
     from operating activities:
      Depreciation                                                   19,852         17,943
      Amortization of cost of stock benefit plans                    13,241         19,410
      Amortization of investment premiums and discounts               -                315
      Provision for loan losses                                       4,500          4,500
      Increase (decrease) in deferred income                         (2,285)        20,153
      Change in current and deferred income tax                      20,655         (2,813)
      Increase in accrued interest receivable                       (42,354)       (77,167)
      Increase (decrease) in accrued interest payable               (10,493)        30,533
      Change in prepaid and accrued items, net                      111,738        (79,658)
                                                                -----------     ----------

Net cash provided by operating activities                           242,960         38,071
                                                                -----------     ----------

Cash flows from investing activities:
      Proceeds from maturities of investment securities             500,000        600,000
      Proceeds from repayments of mortgage-backed securities        550,115        791,136
      Purchase of investment securities, available for sale        (100,000)      (100,000)
      Purchase of Federal Home Loan Bank stock                        -            (56,400)
      Disbursements for loans originated or purchased            (7,993,809)    (9,977,004)
      Loan repayments                                             6,865,519      5,763,780
      Participation loans sold                                      573,284          -
      Property and equipment expenditures                          (289,985)       (25,480)
                                                                -----------     ----------

Net cash provided by (for) investing activities                     105,124     (3,003,968)
                                                                -----------     ----------

Cash flows from financing activities:
      Deposit account receipts                                    6,664,188      9,738,443
      Deposit account withdrawals                                (7,152,083)    (7,893,397)
      Interest credited to deposit accounts                         718,563        528,418
      Increase in advance payments by borrowers
       for taxes and insurance                                       43,630         45,230
      Purchase of treasury stock                                    (24,000)       (81,906)
                                                                -----------     ----------

Net cash provided by financing activities                           250,298      2,336,788
                                                                -----------     ----------

Increase (decrease) in cash and cash equivalents                    598,382       (629,109)

Cash and cash equivalents at beginning of period                  7,177,578      7,243,783
                                                                -----------     ----------

Cash and cash equivalents at end of period                      $ 7,775,960      6,614,674
                                                                ===========     ==========

Cash paid during the period for:
    Interest                                                    $   947,633        828,726
    Income taxes                                                     45,816         61,045
                                                                ===========     ==========
</TABLE>

See accompanying notes to consolidated financial statements.

                                      -6-
<PAGE>
 
                            WEST TOWN BANCORP, INC.
                                AND SUBSIDIARIES

                         Notes to Financial Statements


Note A -  Basis of Presentation
          ---------------------

          The accompanying unaudited consolidated financial statements have been
          prepared in accordance with instructions to Form 10-QSB and,
          therefore, do not include information or footnotes necessary for fair
          presentation of financial condition, results of operations and changes
          in financial position in conformity with generally accepted accounting
          principles. However, in the opinion of management, all adjustments
          (which are normal and recurring in nature) necessary for a fair
          presentation have been included. The preparation of financial
          statements in conformity with generally accepted accounting principles
          requires management to make estimates and assumptions that affect the
          reported amounts of assets and liabilities and disclosures of
          contingent assets and liabilities at the date of the financial
          statements and the reported amounts of revenues and expenses during
          the reporting period. Actual results could differ from those
          estimates. The results of operations for the three and nine month
          periods ended December 31, 1998, are not necessarily indicative of the
          results which may be expected for the entire year.

Note B -  Principles of Consolidation
          ---------------------------

          The accompanying unaudited consolidated financial statements include
          the accounts of West Town Bancorp, Inc. (the "Company") and its wholly
          owned subsidiary West Town Savings Bank (the "Bank") and the Bank's
          wholly owned subsidiary West Town Insurance Agency, Inc. All
          significant intercompany accounts and transactions have been
          eliminated in consolidation.

Note C -  Plan of Conversion
          ------------------

          In April 1994, the Bank's Board of Directors approved a Plan of
          Conversion, providing for the Bank's conversion from a state chartered
          mutual savings bank to a state chartered stock savings bank with the
          concurrent formation of a holding company. The Company issued 221,940
          shares of $.01 par value common stock at $10.00 per share, for an
          aggregate purchase price of $2,219,400. The Conversion and sale of
          221,940 shares of common stock of the Company was completed on March
          1, 1995. Net proceeds to the Company, after conversion expenses,
          totaled approximately $1,889,000.

Note D -  Earnings Per Share
          ------------------

          Earnings per share for the three and nine month periods ended December
          31, 1998 and 1997 was determined by dividing net income for the period
          by the weighted average number of both basic and diluted shares of
          common stock and common stock equivalents outstanding (see Exhibit 11
          attached). Stock options are regarded as common stock equivalents and
          are therefore considered in diluted earnings per share calculations.
          Common stock equivalents are computed using the treasury stock method.
          ESOP shares not committed to be released to participants are not
          considered outstanding for purposes of computing earnings per share
          amounts.

                                      -7-
<PAGE>
 
Notes to Financial Statements (continued)
-----------------------------------------

Note E -  Effect of New Accounting Standards
          ----------------------------------

          In December 1997, the FASB issued Statement of Financial Accounting
          Standards No. 131, "Disclosures about Segments of an Enterprise and
          Related Information" ("SFAS No. 131") which becomes effective for
          fiscal years beginning after December 15, 1997. SFAS No. 131
          establishes standards for the way that public business enterprises
          report information about operating segments and requires enterprises
          to report selected information about operating segments in interim
          financial reports. Management does not believe that adoption of SFAS
          No. 131 will have a material impact on the Company's consolidated
          financial condition or results of operations.

          In February 1998, the FASB issued Statement of Financial Accounting
          Standards No. 132, "Employers' Disclosures about Pensions and Other
          Postretirement Benefits" ("SFAS No. 132"). SFAS No. 132 alters current
          disclosure requirements regarding pensions and other postretirement
          benefits in the financial statements of employers who sponsor such
          benefit plans. The revised disclosure requirements are designed to
          provide additional information to assist readers in evaluating future
          costs related to such plans. Additionally, the revised disclosures are
          designed to provide changes in the components of pension and benefit
          costs in addition to the year end components of those factors in the
          resulting asset or liability related to such plans. The statement is
          effective for fiscal years beginning after December 15, 1997 with
          earlier application available. Management does not believe that
          adoption of SFAS No. 132 will have a material impact on the Company's
          consolidated financial condition or results of operations.

          In June 1998, the FASB issued Statement of Financial Accounting
          Standards No. 133, "Accounting for Derivative Instruments and Hedging
          Activities", ("SFAS No. 133") which is effective for fiscal years
          beginning after June 15, 1999. The statement requires all derivatives
          to be recorded on the balance sheet at fair value. It also establishes
          "special accounting" for hedges of changes in the fair value of
          assets, liabilities, or firm commitments (fair value hedges), hedges
          of the variable cash flows of forecasted transactions (cash flow
          hedges), and hedges of foreign currency exposures of net investments
          in foreign operations. To the extent the hedge is considered highly
          effective, both the change in the fair value of the derivative and the
          change in the fair value of the hedged item are recognized (offset) in
          earnings in the same period. Changes in fair value of derivatives that
          do not meet the criteria of one of these three hedge categories are
          included in income. Management does not believe that adoption of SFAS
          No. 133 will have a material impact on the Company's consolidated
          financial condition or results of operations.

          In October 1998, the FASB issued Statement of Financial Accounting
          Standards No. 134, "Accounting for Mortgage-Backed Securities Retained
          after the Securitization of Mortgage Loans Held for Sale by a Mortgage
          Banking Enterprise" ("SFAS No. 134"), which is effective for the first
          fiscal quarter after December 15, 1998. This statement amends SFAS No.
          65 "Accounting for Certain Mortgage Banking Activities". This
          statement revises the accounting for retained securities and
          beneficial interests. Management does not believe that adoption of
          SFAS No. 134 will have a material impact on the Company's consolidated
          financial condition or results of operations.

          The foregoing does not constitute a comprehensive summary of all
          material changes or developments affecting the manner in which the
          Company keeps its books and records and performs its financial
          accounting responsibilities. It is intended only as a summary of some
          of the recent pronouncements made by the FASB which are of particular
          interest to financial institutions.

                                      -8-
<PAGE>
 
                            WEST TOWN BANCORP, INC.
                               AND SUBSIDIARIES

                     Management's Discussions and Analysis
               of Financial Condition and Results of Operations


Financial Condition
-------------------

     The assets of West Town Bancorp, Inc. (the "Company") increased
approximately $540,000, or 1.83%, for the nine month period ended December 31,
1998. This increase was primarily the result of increases in cash and cash
equivalents and in mortgage loans receivable held by West Town Savings Bank (the
"Bank"), which were primarily funded by excess cash liquidity resulting from
maturities of investment securities and mortgage-backed securities and increased
deposits during the nine month period ended December 31, 1998.

     Net loans receivable increased $1.1 million, or 6.10%, for the nine months
ended December 31, 1998. During that period, the Bank originated or purchased
approximately $8.0 million in loans which exceeded repayments of $6.9 million
and participation loans sold of $573,000 during the same period.

     The Bank experienced an increase in savings deposits for the nine month
period of approximately $231,000, or .91%. It is management's belief that part
of the deposit activity for the nine months ended December 31, 1998 can be
attributed to new deposit products.

     Stockholders' equity increased approximately $161,000, or 3.99%, for the
nine month period ended December 31, 1998. This increase was primarily the
result of the amortization of the cost of the Company's stock benefit plans of
$13,000, net income for the nine months of $128,000 and unrealized gains on
available for sale securities of $44,000, partially offset by the purchase of
treasury stock at a cost of $24,000. As of December 31, 1998, the book value per
common share outstanding was $18.90.

Analysis of Operations
----------------------

     A net profit of $34,000 was recognized for the three months ended December
31, 1998 as compared to a net profit of $37,000 for the same period in 1997.
This $3,000 decrease in net income was due primarily to a decrease in net
interest income of $7,000 and an increase in non-interest expense of $4,000,
partially offset by a decrease in income taxes of $7,000. The Company's net
income for the nine months ended December 31, 1998 was $128,000 as compared to
net income of $105,000 for the nine months ended December 31, 1997. This $23,000
increase in net income was due primarily to a $40,000 increase in net interest
income, and a $6,000 increase in non-interest income, partially offset by a
$10,000 increase in non-interest expense, and by a $12,000 increase in income
taxes.

     Interest income decreased by $8,000 for the three month period ended
December 31, 1998 as compared to the same three month period in 1997. This was
primarily the result of a decrease in the average yield to 6.84% from 7.21%,
partially offset by an increase in the average balances of interest-earning
assets to $28.8 million for the three months ended December 31, 1998 from $27.8
million for the three months ended December 31, 1997. Interest income increased
$118,000 for the nine month period ended December 31, 1998 as compared to the
same nine month period in 1997. This was primarily the result of an increase in
the average balance of interest-earning assets, as well as an increase in the
average yield on those assets. The average balances of those assets increased
from approximately $26.7 million to $28.6 million for the nine months ended
December 31, 1997 and 1998 respectively. This increase was accompanied by an
increase in the average yield earned from 7.08% to 7.14% for the nine months
ended December 31, 1997 and 1998 respectively.

                                      -9-
<PAGE>
 
Analysis of Operations (continued)
----------------------------------

     Interest expense decreased from $310,000 to $309,000 from the three months
ended December 31, 1997 to the same period in 1998. This decrease was
attributable to a decrease in the average cost of savings from 4.99% to 4.85%,
partially offset by an increase in the average balances of interest-bearing
liabilities to $25.5 million from $24.9 million for the three months ended
December 31, 1998 and 1997 respectfully. Interest expense increased from
$859,000 to $937,000 from the nine months ended December 31, 1997 to the same
period in 1998. This increase was attributable to an increase in the average
balance of interest-bearing liabilities to $25.4 million for the nine months
ended December 31, 1998 from $23.8 million for the same period in 1997, as well
as an increase in the average cost of savings to 4.92% from 4.81% for the same
nine month periods.

     The Bank calculates any allowance for loan losses based upon its ongoing
evaluation of pertinent factors underlying the types and quality of its loans,
including the risk inherent in its loan portfolio, and other factors such as the
current regulatory and economic environment. Based upon this evaluation, loan
loss provisions are recorded. Provisions of $1,500 and $1,500 were made for the
three month periods ended December 31, 1998 and 1997 respectively, and
provisions of $4,500 and $4,500 were made for the nine month periods ended
December 31, 1998 and 1997 respectively. Management believes that additions to
its provision for loan losses have been appropriate, given the risks inherent in
its loan portfolio, and the current regulatory and economic environment.
Although the Bank believes its allowance for loan losses is at a level which it
considers to be adequate to provide for potential losses, there can be no
assurance that such losses will not exceed the estimated amounts.

     Non-interest income remained relatively constant for the three months ended
December 31, 1998 as compared to the same period in 1997. Non-interest income
increased by $6,000 for the nine months ended December 31, 1998 as compared to
the same period in 1997. This increase was primarily attributable to an increase
in deposit-related fee income.

     Non-interest expense increased from $138,000 to $142,000 from the three
months ended December 31, 1997 to the three months ended December 31, 1998. This
increase was primarily attributable to increases in staffing costs and occupancy
expenses, partially offset by a decrease in professional fees. Non-interest
expense increased from $414,000 to $424,000 from the nine months ended December
31, 1997 to the nine months ended December 31, 1998. The increase for the nine
month period was primarily the result of increases in occupancy and equipment
expenses of $11,000 and data processing of $8,000, partially offset by decreases
in professional fees of $3,000 and in other expenses of $6,000.

     The provision for income taxes decreased $7,000 and increased $12,000 for
the three and nine months ended December 31, 1998, respectively, as compared to
the same periods in 1997. These changes were attributable to changes in pre-tax
income between the comparable periods.

                                     -10-
<PAGE>
 
Liquidity and Capital Resources
-------------------------------

     At December 31, 1998, the Bank continued to comply with its liquidity
requirements, with an overall liquid asset ratio of 24.64% and a short-term
liquid asset ratio of 25.81%. Management's objectives and strategies for the
Bank have consistently maintained liquidity levels in excess of regulatory
requirements. It is management's intent to continue its efforts to deploy excess
liquidity into mortgage loans and mortgage-backed securities; however, the
success of lending efforts is dependent upon the availability of favorable loan
opportunities and the competition therefor. At December 31, 1998, the Bank had
no outstanding commitments to fund loans, and no commitments to purchase
mortgage-backed securities or other investment securities.

     The Bank was in compliance with regulatory capital requirements at 
December 31, 1998. Capital requirements, ratios, and balances are as follows:

<TABLE>
<CAPTION>
                                                                            To Be Well-
                                                                         Capitalized Under
                                                   For Capital           Prompt Corrective
                              Actual            Adequacy Purposes        Action Provisions
                          -----------------------------------------------------------------
                          Amount     Ratio(1)     Amount   Ratio(1)      Amount    Ratio(1)
                          -----------------------------------------------------------------

  December 31, 1998
  -----------------
  <S>                   <C>           <C>     <C>          <C>        <C>           <C>
  Risk-based            $ 3,248,280   25.13%  $ 1,034,203  8.00%      $ 1,292,754   10.00%
  Core                    3,197,609   10.96       876,391  3.00         1,460,652    5.00
</TABLE>
-----------------
     (1)  Core capital levels are shown as a percentage of total adjusted
          assets; risk-based capital levels are shown as a percentage of risk-
          weighted assets.



Year 2000 Compliance
--------------------

     The Company utilizes and is dependent upon data processing systems and
software to conduct its business. The data processing systems and software
include those developed and maintained by the Company's third-party data
processing vendor and purchased software which is run on in-house computer
networks. During the previous fiscal year, the Company initiated a review and
assessment of all hardware and software to confirm that it will function
properly in the year 2000. To date, those vendors which have been contacted have
indicated that their hardware or software is or will be Year 2000 compliant in
time frames that meet regulatory requirements. The costs associated with the
compliance efforts are not expected to have a significant impact on the
Company's ongoing results of operations.

Safe Harbor Provision of the Private Securities Litigation Reform Act of 1995
-----------------------------------------------------------------------------

     Management's Discussion and Analysis of Financial Condition and Results of
Operations that are not historical facts are forward-looking statements subject
to the safe harbor created by the Private Securities Litigation Reform Act of
1995. The Company cautions readers of this Form 10-QSB that a number of
important factors could cause the Company's actual results in 1998/1999 and
beyond to differ materially from those expressed in any such forward-looking
statements. These factors include, without limitation, the general economic and
business conditions affecting the Company's customers; changes in interest
rates; the adequacy of the Bank's allowance for loan losses; competition from,
among others, commercial banks, savings and loan associations, mutual funds,
money market funds, finance companies, credit unions, mortgage companies, and
the United States Government; limited partnership activities; federal and state
legislation, regulation and supervision of the Bank and its subsidiaries; the
risk of defaults on loans; and contractual, statutory and regulatory
restrictions on the Bank's ability to pay dividends to the Company.

                                      -11-
<PAGE>
 
                         PART II - OTHER INFORMATION 

                            WEST TOWN BANCORP INC.
                               AND SUBSIDIARIES


Item 1.   LEGAL PROCEEDINGS
          -----------------

          From time to time, the Company and Bank are parties to legal
          proceedings in the ordinary course of business, wherein they enforce
          their security interest. The Company and Bank are not engaged in any
          legal proceedings of a material nature at the present time.

Item 2.   CHANGES IN SECURITIES
          ---------------------
 
          Not applicable

Item 3.   DEFAULTS UPON SENIOR SECURITIES
          -------------------------------

          Not applicable

Item 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
          ---------------------------------------------------

          Not applicable

Item 5.   OTHER INFORMATION
          -----------------

          Not applicable

Item 6.   EXHIBITS AND REPORTS ON FORM 8-K
          --------------------------------

          (a) Computation of earnings per share (Exhibit 11 filed herewith)

          (b) No reports on Form 8-K were filed during the quarter ended
              December 31, 1998.

                                     -12-
<PAGE>
 
                                   SIGNATURES


     Pursuant to the requirements of Section 13 or 15 (d) of the Securities and
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.


                            WEST TOWN BANCORP, INC.
                            -----------------------
                                  Registrant



DATE:  January 29, 1999
 


BY: /s/ Dennis B. Kosobucki
    ----------------------------------
    Dennis B. Kosobucki
    Chairman of the Board,
    President and Chief Executive Officer
    (Duly Authorized Representative and
    Principal Executive Officer)



BY: /s/ Jeffrey P. Kosobucki
    ----------------------------------
    Jeffrey P. Kosobucki
    Vice President and Chief Financial Officer
    (Principal Financial Officer)

                                     -13-
<PAGE>
 
                               INDEX TO EXHIBITS


Exhibit No.                                                               PAGE
----------                                                                ----

   11            Statement regarding Computation of Earnings Per Share     15


                                      -14-