UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q/A

(AMENDMENT NO. 2)

(Mark One)



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

For the quarterly period ended December 31, 2007

or



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

For the transition period from  to

Commission File Number 001-16845

PFF BANCORP, INC.

(Exact name of registrant as specified in its charter)



|                                                              |  |                           
|------------------------------------------------------------- |  | --------------------------
|DELAWARE                                                      |  | 95-4561623                
|(State or other jurisdiction ofincorporation or organization) |  | (I.R.S. Employer I.D. No.)
|                                                              | 
|9337 Milliken Avenue, Rancho Cucamonga, California            |  | 91730                     
|(Address of principal executive offices)                      |  | (Zip Code)                

(909) 941-5400

(Registrants telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

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

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

Large accelerated filer  x            Accelerated filer   ̈            Non- accelerated filer   ̈.

Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange
Act).    Yes   ̈    No  x.

The registrant had 22,624,961 shares of common stock, par value $0.01 per share, outstanding as of January 31, 2008.









---

EXPLANATORY NOTE

This Form 10-Q/A (Amendment No. 2) is being filed solely to combine Part I, Item 1 of the Form 10-Q filed on February 8, 2008 (the Form 10-Q) and Part I, Item 1 of the Form 10-Q/A (Amendment No. 1) filed
on February 20, 2008 (the Initial Form 10-Q/A). There are no other changes or amendments to the Form 10-Q or the Initial Form 10-Q/A.



|Item 1. | Financial Statements.
|------- | ---------------------

Report of Independent
Registered Public Accounting Firm

The Board of Directors and Shareholders

PFF Bancorp, Inc.:

We have reviewed the accompanying consolidated
balance sheet of PFF Bancorp, Inc. and subsidiaries (the Company) as of December 31, 2007, the related consolidated statements of earnings (losses) and comprehensive earnings (losses) for the three-month and nine-month periods ended
December 31, 2007 and 2006, the related consolidated statement of stockholders equity for the nine-month period ended December 31, 2007, and the related consolidated cash flows for the nine-month period ended December 31, 2007
and 2006. These consolidated financial statements are the responsibility of the Companys management.

We conducted our review in accordance with the
standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that
should be made to the consolidated financial statements referred to above for them to be in conformity U.S. generally accepted accounting principles.

/s/ KPMG LLP

Los Angeles, California

February 14, 2008



---

PFF BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except per share data)

(Unaudited)



|                                                                                                                                                                                  |  |                  |           |   |               |   |           |  
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------- | --------- | - | ------------- | - | --------- | -
|                                                                                                                                                                                  |  | December 31,2007 |           |   | March 31,2007 |  
|Assets                                                                                                                                                                            |  |                  |           |   |               |   |           |  
|Cash and cash equivalents                                                                                                                                                         |  | $                | 61,559    |   |               | $ | 59,587    |  
|Investment securities held-to-maturity (estimated fair value of $7,147 at December 31, 2007, and $6,646 at March 31,
2007)                                                        |  |                  | 6,809     |   |               |   | 6,712     |  
|Investment securities available-for-sale, at fair value                                                                                                                           |  |                  | 1,661     |   |               |   | 28,067    |  
|Mortgage-backed securities available-for-sale, at fair value                                                                                                                      |  |                  | 165,190   |   |               |   | 186,607   |  
|Loans held-for-sale                                                                                                                                                               |  |                  | 1,674     |   |               |   |          |  
|Loans and leases receivable, net (net of allowances for loan and lease losses of $72,845 at December 31, 2007 and $46,315 at
March 31, 2007)                                      |  |                  | 3,957,379 |   |               |   | 4,116,232 |  
|Federal Home Loan Bank (FHLB) stock, at cost                                                                                                                                      |  |                  | 36,669    |   |               |   | 46,158    |  
|Accrued interest receivable                                                                                                                                                       |  |                  | 22,562    |   |               |   | 25,704    |  
|Assets acquired through foreclosure, net                                                                                                                                          |  |                  | 973       |   |               |   |          |  
|Property and equipment, net                                                                                                                                                       |  |                  | 60,192    |   |               |   | 56,564    |  
|Prepaid expenses and other assets                                                                                                                                                 |  |                  | 59,207    |   |               |   | 27,896    |  
|                                                                                                                                                                                  |  |                  |           |   |               |   |           |  
|Total assets                                                                                                                                                                      |  | $                | 4,373,875 |   |               | $ | 4,553,527 |  
|                                                                                                                                                                                  |  |                  |           |   |               |   |           |  
|Liabilities and Stockholders Equity                                                                                                                                              |  |                  |           |   |               |   |           |  
|Liabilities:                                                                                                                                                                      |  |                  |           |   |               |   |           |  
|Deposits                                                                                                                                                                          |  | $                | 3,246,534 |   |               | $ | 3,291,645 |  
|FHLB advances and other borrowings                                                                                                                                                |  |                  | 684,400   |   |               |   | 775,300   |  
|Junior subordinated debentures                                                                                                                                                    |  |                  | 87,630    |   |               |   | 56,702    |  
|Accrued expenses and other liabilities                                                                                                                                            |  |                  | 29,030    |   |               |   | 32,767    |  
|                                                                                                                                                                                  |  |                  |           |   |               |   |           |  
|Total liabilities                                                                                                                                                                 |  |                  | 4,047,594 |   |               |   | 4,156,414 |  
|Commitments and contingencies                                                                                                                                                     |  |                  |          |   |               |   |          |  
|Stockholders equity:                                                                                                                                                             |  |                  |           |   |               |   |           |  
|Preferred stock, $0.01 par value. Authorized 2,000,000 shares; none issued                                                                                                        |  |                  |          |   |               |   |          |  
|Common stock, $0.01 par value. Authorized 59,000,000 shares; issued and outstanding 22,624,961 shares and 24,156,834 shares at
December 31, 2007 and March 31, 2007, respectively |  |                  | 225       |   |               |   | 240       |  
|Additional paid-in capital                                                                                                                                                        |  |                  | 172,902   |   |               |   | 180,285   |  
|Retained earnings                                                                                                                                                                 |  |                  | 157,692   |   |               |   | 221,892   |  
|Accumulated other comprehensive losses                                                                                                                                            |  |                  | (4,538    | ) |               |   | (5,304    | )
|                                                                                                                                                                                  |  |                  |           |   |               |   |           |  
|Total stockholders equity                                                                                                                                                        |  |                  | 326,281   |   |               |   | 397,113   |  
|                                                                                                                                                                                  |  |                  |           |   |               |   |           |  
|Total liabilities and stockholders equity                                                                                                                                        |  | $                | 4,373,875 |   |               | $ | 4,553,527 |  
|                                                                                                                                                                                  |  |                  |           |   |               |   |           |  

See accompanying notes to the unaudited consolidated financial statements.



3



---

PFF BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)

(Dollars in thousands, except per
share data)

(Unaudited)



|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|------------------------------------------------------------------------------------- |  | -------------------------------------- | ---------- | - | ------------------------------------- | - | ---------- | ---- |  | - | ---------- | - |  | - | ---------- | -
|                                                                                      |  | For the Three Months EndedDecember 31, |            |   | For the Nine Months EndedDecember 31, |  
|                                                                                      |  | 2007                                   |            |   | 2006                                  |   |            | 2007 |  |   | 2006       |  
|Interest income:                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Loans and leases receivable                                                           |  | $                                      | 72,178     |   |                                       | $ | 82,751     |      |  | $ | 230,915    |   |  | $ | 239,539    |  
|Mortgage-backed securities                                                            |  |                                        | 1,947      |   |                                       |   | 2,648      |      |  |   | 5,999      |   |  |   | 8,025      |  
|Investment securities and deposits                                                    |  |                                        | 730        |   |                                       |   | 1,578      |      |  |   | 2,387      |   |  |   | 4,750      |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Total interest income                                                                 |  |                                        | 74,855     |   |                                       |   | 86,977     |      |  |   | 239,301    |   |  |   | 252,314    |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Interest expense:                                                                     |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Deposits                                                                              |  |                                        | 30,248     |   |                                       |   | 28,550     |      |  |   | 90,253     |   |  |   | 76,966     |  
|Borrowings                                                                            |  |                                        | 10,379     |   |                                       |   | 13,269     |      |  |   | 32,610     |   |  |   | 37,460     |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Total interest expense                                                                |  |                                        | 40,627     |   |                                       |   | 41,819     |      |  |   | 122,863    |   |  |   | 114,426    |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Net interest income                                                                   |  |                                        | 34,228     |   |                                       |   | 45,158     |      |  |   | 116,438    |   |  |   | 137,888    |  
|Provision for loan and lease losses                                                   |  |                                        | 35,000     |   |                                       |   | 1,900      |      |  |   | 90,800     |   |  |   | 4,920      |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Net interest income (expense) after provision for loan and lease losses               |  |                                        | (772       | ) |                                       |   | 43,258     |      |  |   | 25,638     |   |  |   | 132,968    |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Non-interest income:                                                                  |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Deposit and related fees                                                              |  |                                        | 3,868      |   |                                       |   | 3,519      |      |  |   | 11,344     |   |  |   | 10,192     |  
|Loan and servicing fees                                                               |  |                                        | 355        |   |                                       |   | 566        |      |  |   | 1,128      |   |  |   | 1,737      |  
|Trust, investment and insurance fees                                                  |  |                                        | 1,325      |   |                                       |   | 1,529      |      |  |   | 4,541      |   |  |   | 4,353      |  
|Gain on sale of loans, net                                                            |  |                                        | 37         |   |                                       |   | 81         |      |  |   | 152        |   |  |   | 164        |  
|Gain on sale of securities, net                                                       |  |                                        |           |   |                                       |   |           |      |  |   |           |   |  |   | 271        |  
|Mark-to-market on interest rate swaps                                                 |  |                                        | (730       | ) |                                       |   | (35        | )    |  |   | (1,139     | ) |  |   | (357       | )
|Other non-interest income                                                             |  |                                        | 254        |   |                                       |   | 349        |      |  |   | 929        |   |  |   | 1,754      |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Total non-interest income                                                             |  |                                        | 5,109      |   |                                       |   | 6,009      |      |  |   | 16,955     |   |  |   | 18,114     |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Non-interest expense:                                                                 |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|General and administrative:                                                           |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Compensation and benefits                                                             |  |                                        | 14,735     |   |                                       |   | 14,595     |      |  |   | 41,498     |   |  |   | 43,926     |  
|Occupancy and equipment                                                               |  |                                        | 5,273      |   |                                       |   | 4,190      |      |  |   | 14,994     |   |  |   | 12,215     |  
|Marketing and professional services                                                   |  |                                        | 3,397      |   |                                       |   | 3,088      |      |  |   | 9,901      |   |  |   | 9,405      |  
|Other general and administrative                                                      |  |                                        | 6,668      |   |                                       |   | 4,136      |      |  |   | 14,577     |   |  |   | 11,410     |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Total general and administrative                                                      |  |                                        | 30,073     |   |                                       |   | 26,009     |      |  |   | 80,970     |   |  |   | 76,956     |  
|Foreclosed asset operations, net                                                      |  |                                        | 42         |   |                                       |   | (355       | )    |  |   | 51         |   |  |   | (470       | )
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Total non-interest expense                                                            |  |                                        | 30,115     |   |                                       |   | 25,654     |      |  |   | 81,021     |   |  |   | 76,486     |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Earnings (loss) before income taxes                                                   |  |                                        | (25,778    | ) |                                       |   | 23,613     |      |  |   | (38,428    | ) |  |   | 74,596     |  
|Income taxes (benefit)                                                                |  |                                        | (11,095    | ) |                                       |   | 9,970      |      |  |   | (16,754    | ) |  |   | 31,485     |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Net earnings (loss)                                                                   |  | $                                      | (14,683    | ) |                                       | $ | 13,643     |      |  | $ | (21,674    | ) |  | $ | 43,111     |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Basic earnings (loss) per share                                                       |  | $                                      | (0.65      | ) |                                       | $ | 0.56       |      |  | $ | (0.94      | ) |  | $ | 1.76       |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Weighted average shares outstanding for basic earnings (loss) per share calculation   |  |                                        | 22,592,898 |   |                                       |   | 24,557,623 |      |  |   | 23,116,004 |   |  |   | 24,500,157 |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Diluted earnings (loss) per share                                                     |  | $                                      | (0.65      | ) |                                       | $ | 0.55       |      |  | $ | (0.94      | ) |  | $ | 1.74       |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  
|Weighted average shares outstanding for diluted earnings (loss) per share calculation |  |                                        | 22,592,898 |   |                                       |   | 24,893,341 |      |  |   | 23,116,004 |   |  |   | 24,819,134 |  
|                                                                                      |  |                                        |            |   |                                       |   |            |      |  |   |            |   |  |   |            |  

See accompanying notes to the unaudited consolidated financial statements.



4



---

PFF BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (LOSS)

(Dollars in
thousands)

(Unaudited)



|                                                                                                                                                                                                                                             |  |                                        |         |                                       |      |   |        |  |   |         |   |  |   |        |  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------- | ------- | ------------------------------------- | ---- | - | ------ |  | - | ------- | - |  | - | ------ | -
|                                                                                                                                                                                                                                             |  | For the Three Months EndedDecember 31, |         | For the Nine Months EndedDecember 31, |     
|                                                                                                                                                                                                                                             |  | 2007                                   |         |                                       | 2006 |   | 2007   |  |   | 2006    |  
|Net earnings (loss)                                                                                                                                                                                                                          |  | $                                      | (14,683 | )                                     |      | $ | 13,643 |  | $ | (21,674 | ) |  | $ | 43,111 |  
|                                                                                                                                                                                                                                             |  |                                        |         |                                       |      |   |        |  |   |         |   |  |   |        |  
|Other comprehensive earnings (loss), net of income tax expense (benefit)                                                                                                                                                                     |  |                                        |         |                                       |      |   |        |  |   |         |   |  |   |        |  
|Change in unrealized gains (loss) on:                                                                                                                                                                                                        |  |                                        |         |                                       |      |   |        |  |   |         |   |  |   |        |  
|Investment securities available-for-sale, at fair value, net of income tax expense (benefit) of $(2) and $8 for three months ended December,
2007 and 2006, and $(2) and $64 for nine months ended December 31, 2007 and 2006, respectively  |  |                                        | (3      | )                                     |      |   | 11     |  |   | (3      | ) |  |   | 89     |  
|Mortgage-backed securities available-for-sale, at fair value, net of income tax expense of $264 and $259 for three months ended
December 31, 2007 and 2006, and $548 and $872 for nine months ended December 31, 2007 and 2006, respectively |  |                                        | 365     |                                       |      |   | 357    |  |   | 757     |   |  |   | 1,204  |  
|Reclassification of realized investment securities gains included in earnings (loss), net of income tax expense (benefit) of $8 and $(126) for
nine months ended December 31, 2007 and 2006, respectively                                    |  |                                        |        |                                       |      |   |       |  |   | 11      |   |  |   | (174   | )
|Reclassification of realized mortgage-backed securities gains (loss) included in earnings (loss), net of income tax expense of $1 and $0 for
nine months ended December 31, 2007 and 2006, respectively                                      |  |                                        |        |                                       |      |   |       |  |   | 1       |   |  |   |       |  
|Reclassification of realized credits on interest rate swaps included in earnings (loss), net of income tax benefit of $0 and $67 for nine
months ended December 31, 2007 and 2006, respectively                                              |  |                                        |        |                                       |      |   |       |  |   |        |   |  |   | (93    | )
|                                                                                                                                                                                                                                             |  |                                        |         |                                       |      |   |        |  |   |         |   |  |   |        |  
|Other comprehensive income                                                                                                                                                                                                                   |  |                                        | 362     |                                       |      |   | 368    |  |   | 766     |   |  |   | 1,026  |  
|                                                                                                                                                                                                                                             |  |                                        |         |                                       |      |   |        |  |   |         |   |  |   |        |  
|Comprehensive earnings (loss)                                                                                                                                                                                                                |  | $                                      | (14,321 | )                                     |      | $ | 14,011 |  | $ | (20,908 | ) |  | $ | 44,137 |  
|                                                                                                                                                                                                                                             |  |                                        |         |                                       |      |   |        |  |   |         |   |  |   |        |  

See accompanying notes to the unaudited consolidated financial statements.



5



---

PFF BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY

(Dollars in thousands,
except per share data)

(Unaudited)



|                                                                  |  |                                           |   |  |             |     |   |                          |   |         |                  |  |   |               |   |  |                                              |     |   |       |   |        |   |  |   |         |  
|----------------------------------------------------------------- |  | ----------------------------------------- | - |  | ----------- | --- | - | ------------------------ | - | ------- | ---------------- |  | - | ------------- | - |  | -------------------------------------------- | --- | - | ----- | - | ------ | - |  | - | ------- | -
|                                                                  |  | Number ofShares                           |   |  | CommonStock |     |   | AdditionalPaid-inCapital |   |         | RetainedEarnings |  |   | TreasuryStock |   |  | AccumulatedOtherComprehensiveIncome (Losses) |     |   | Total |  
|                                                                  |  | (Dollars in thousands, except share data) |  
|Balance at March 31, 2007                                         |  | 24,156,834                                |   |  | $           | 240 |   |                          | $ | 180,285 |                  |  | $ | 221,892       |   |  | $                                            |    |   |       | $ | (5,304 | ) |  | $ | 397,113 |  
|Net earnings (loss)                                               |  |                                          |   |  |             |    |   |                          |   |        |                  |  |   | (21,674       | ) |  |                                              |    |   |       |   |       |   |  |   | (21,674 | )
|Repurchase of common stock                                        |  | (1,611,975                                | ) |  |             |    |   |                          |   | (7,657  | )                |  |   | (29,443       | ) |  |                                              | (16 | ) |       |   |       |   |  |   | (37,116 | )
|Stock issued for incentive plan                                   |  | 73,426                                    |   |  |             |    |   |                          |   |        |                  |  |   |              |   |  |                                              |    |   |       |   |       |   |  |   |        |  
|Amortization under stock-based compensation plans                 |  |                                          |   |  |             |    |   |                          |   | (82     | )                |  |   |              |   |  |                                              |    |   |       |   |       |   |  |   | (82     | )
|Stock options exercised                                           |  | 6,676                                     |   |  |             | 1   |   |                          |   | 56      |                  |  |   |              |   |  |                                              |    |   |       |   |       |   |  |   | 57      |  
|Stock options expense                                             |  |                                          |   |  |             |    |   |                          |   | 239     |                  |  |   |              |   |  |                                              |    |   |       |   |       |   |  |   | 239     |  
|Dividends ($0.19 per share for June, September and December 2007) |  |                                          |   |  |             |    |   |                          |   |        |                  |  |   | (13,083       | ) |  |                                              |    |   |       |   |       |   |  |   | (13,083 | )
|Treasury stock retirement                                         |  |                                          |   |  |             | (16 | ) |                          |   |        |                  |  |   |              |   |  |                                              | 16  |   |       |   |       |   |  |   |        |  
|Changes in unrealized losses on securities AFS, net               |  |                                          |   |  |             |    |   |                          |   |        |                  |  |   |              |   |  |                                              |    |   |       |   | 766    |   |  |   | 766     |  
|Tax benefit from stock-based compensation                         |  |                                          |   |  |             |    |   |                          |   | 61      |                  |  |   |              |   |  |                                              |    |   |       |   |       |   |  |   | 61      |  
|                                                                  |  |                                           |   |  |             |     |   |                          |   |         |                  |  |   |               |   |  |                                              |     |   |       |   |        |   |  |   |         |  
|Balance at December 31, 2007                                      |  | 22,624,961                                |   |  | $           | 225 |   |                          | $ | 172,902 |                  |  | $ | 157,692       |   |  | $                                            |    |   |       | $ | (4,538 | ) |  | $ | 326,281 |  
|                                                                  |  |                                           |   |  |             |     |   |                          |   |         |                  |  |   |               |   |  |                                              |     |   |       |   |        |   |  |   |         |  

See accompanying notes to the unaudited consolidated financial statements.



6



---

PFF BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands)

(Unaudited)



|                                                                                      |  |                                |          |   |      |   |          |  
|------------------------------------------------------------------------------------- |  | ------------------------------ | -------- | - | ---- | - | -------- | -
|                                                                                      |  | Nine Months Ended December 31, |         
|                                                                                      |  | 2007                           |          |   | 2006 |  
|Cash flows from operating activities:                                                 |  |                                |          |   |      |   |          |  
|Net earnings (loss)                                                                   |  | $                              | (21,674  | ) |      | $ | 43,111   |  
|Adjustments to reconcile net earnings to net cash provided by operating activities:   |  |                                |          |   |      |   |          |  
|Amortization of premiums, net of discount accretion on loans, leases and securities   |  |                                | 467      |   |      |   | 1,016    |  
|Dividends on FHLB stock                                                               |  |                                | (1,591   | ) |      |   | (1,609   | )
|Provisions for losses on loans and leases                                             |  |                                | 90,800   |   |      |   | 4,920    |  
|Gains on sales of loans, securities available-for-sale and property and equipment     |  |                                | (169     | ) |      |   | (1,491   | )
|Depreciation and amortization of property and equipment                               |  |                                | 4,752    |   |      |   | 3,400    |  
|Loans originated for sale                                                             |  |                                | (1,674   | ) |      |   | (12,666  | )
|Proceeds from sale of loans held-for-sale                                             |  |                                |         |   |      |   | 12,068   |  
|Amortization of stock-based compensation                                              |  |                                | (82      | ) |      |   | 3,480    |  
|Decrease in market value on interest rate swaps                                       |  |                                | 1,139    |   |      |   | 357      |  
|Amortization of deferred issuance cost on junior subordinated debt                    |  |                                | 60       |   |      |   | 60       |  
|Deferred income tax expense (benefit)                                                 |  |                                | (28,357  | ) |      |   | (3,110   | )
|Other, net                                                                            |  |                                | (4,047   | ) |      |   | (1,194   | )
|                                                                                      |  |                                |          |   |      |   |          |  
|Net cash provided by operating activities                                             |  |                                | 39,624   |   |      |   | 48,342   |  
|                                                                                      |  |                                |          |   |      |   |          |  
|Cash flows from investing activities:                                                 |  |                                |          |   |      |   |          |  
|Net change in loans and leases                                                        |  |                                | 66,725   |   |      |   | (284,125 | )
|Principal payments on mortgage-backed securities available-for-sale                   |  |                                | 36,878   |   |      |   | 50,004   |  
|Principal payments on investment securities-available-for-sale                        |  |                                | 1,464    |   |      |   | 1,464    |  
|Purchases of investment securities held-to-maturity                                   |  |                                | (5,802   | ) |      |   |         |  
|Purchases of investment securities available-for-sale                                 |  |                                |         |   |      |   | (25,000  | )
|Purchases of mortgage-backed securities available-for-sale                            |  |                                | (14,501  | ) |      |   | (42,449  | )
|Redemption (purchases) of FHLB stock, net                                             |  |                                | 11,080   |   |      |   | (4,576   | )
|Proceeds from maturity of investment securities                                       |  |                                | 30,700   |   |      |   | 45,000   |  
|Proceeds from sale of investment securities available-for-sale                        |  |                                |         |   |      |   | 5,337    |  
|Proceeds from sale of property and equipment                                          |  |                                | 37       |   |      |   | 1,218    |  
|Purchases of property and equipment                                                   |  |                                | (8,380   | ) |      |   | (12,781  | )
|                                                                                      |  |                                |          |   |      |   |          |  
|Net cash provided by (used in) investing activities                                   |  |                                | 118,201  |   |      |   | (265,908 | )
|                                                                                      |  |                                |          |   |      |   |          |  
|Cash flows from financing activities:                                                 |  |                                |          |   |      |   |          |  
|Net change in deposits                                                                |  |                                | (45,111  | ) |      |   | 181,545  |  
|Proceeds from long-term FHLB advances and other borrowings                            |  |                                | 436,750  |   |      |   | 779,800  |  
|Repayment of long-term FHLB advances and other borrowings                             |  |                                | (522,650 | ) |      |   | (714,100 | )
|Net change in short-term FHLB advances and other borrowings                           |  |                                | (5,000   | ) |      |   | (10,000  | )
|Proceeds from issuance of junior subordinated debentures                              |  |                                | 30,000   |   |      |   |         |  
|Proceeds from exercise of stock options                                               |  |                                | 57       |   |      |   | 604      |  
|Stock option expense                                                                  |  |                                | 239      |   |      |   |         |  
|Cash dividends                                                                        |  |                                | (13,083  | ) |      |   | (12,530  | )
|Excess tax benefit from stock-based compensation arrangements                         |  |                                | 61       |   |      |   | 1,235    |  
|Purchases of treasury stock                                                           |  |                                | (37,116  | ) |      |   |         |  
|                                                                                      |  |                                |          |   |      |   |          |  
|Net cash provided by (used in) financing activities                                   |  |                                | (155,853 | ) |      |   | 226,554  |  
|                                                                                      |  |                                |          |   |      |   |          |  
|Net increase in cash and cash equivalents                                             |  |                                | 1,972    |   |      |   | 8,988    |  
|Cash and cash equivalents, beginning of period                                        |  |                                | 59,587   |   |      |   | 58,831   |  
|                                                                                      |  |                                |          |   |      |   |          |  
|Cash and cash equivalents, end of period                                              |  | $                              | 61,559   |   |      | $ | 67,819   |  
|                                                                                      |  |                                |          |   |      |   |          |  
|Supplemental information:                                                             |  |                                |          |   |      |   |          |  
|Interest paid                                                                         |  | $                              | 125,727  |   |      | $ | 110,504  |  
|Income taxes paid                                                                     |  | $                              | 13,800   |   |      | $ | 31,300   |  
|Non-cash investing and financing activities:                                          |  |                                |          |   |      |   |          |  
|Net transfers from loans and leases receivable to assets acquired through foreclosure |  | $                              | 1,178    |   |      | $ |         |  

See accompanying notes to the unaudited consolidated financial statements.



7



---

PFF BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements



|(1) | Basis of Consolidation
|--- | ----------------------

The accompanying unaudited consolidated
financial statements include the accounts of PFF Bancorp, Inc. (the Bancorp) and its wholly-owned subsidiaries PFF Bank & Trust (the Bank), Glencrest Investment Advisors, Inc. (Glencrest) and Diversified
Builder Services, Inc. (DBS). Our business is conducted primarily through the Bank. The Bank includes the accounts of Pomona Financial Services, Inc. and Diversified Services, Inc. Glencrest includes the accounts of Glencrest Insurance
Services, Inc. The Bancorp owns 100% of the common stock of three unconsolidated special purpose business trusts PFF Bancorp Capital Trust I, PFF Bancorp Capital Trust II and PFF Bancorp Capital Trust III created
for the purpose of issuing capital securities. Subsequent to December 31, 2007, we established a new subsidiary, PFF Real Estate Services, Inc., a wholly owned subsidiary of PFF Bancorp Inc. PFF Real Estate Services, Inc. has not yet commenced
operations. All material intercompany balances and transactions have been eliminated in consolidation. As used throughout this report, the terms we, our, us or the Company refer to the Bancorp and its
consolidated subsidiaries.

Our unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted
in the United States of America 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 accounting principles
generally accepted in the United States of America for complete financial statements. In our opinion, all adjustments (consisting principally of normal recurring accruals) necessary for a fair presentation have been included. We have made certain
reclassifications to the prior years consolidated financial statements to conform to the current presentation. The results of operations for the three and nine months ended December 31, 2007 are not necessarily indicative of results that
may be expected for the entire fiscal year ending March 31, 2008.

These interim consolidated financial statements should be read in conjunction with
our consolidated financial statements, and the notes thereto, included in our Form 10-K for the year ended March 31, 2007.



|(2) | New Accounting Pronouncements
|--- | -----------------------------

In September 2006, the Financial
Accounting Standards Board (FASB) issued SFAS 157 Fair Value Measurements (SFAS 157), which provides a definition of fair value, guidance on the methods used to measure fair value and also expands financial
statement disclosure requirements for fair value information. SFAS 157 establishes a fair value hierarchy that distinguishes between assumptions based on market data from independent sources (observable inputs) and a reporting
entitys internal assumptions based upon the best information available when external market data is limited or unavailable (unobservable inputs). The fair value hierarchy in SFAS 157 prioritizes inputs within three levels. Quoted
prices in active markets have the highest priority (Level 1) followed by observable inputs other than quoted prices (Level 2) and unobservable inputs having the lowest priority (Level 3). SFAS 157 is effective for financial statements issued for
fiscal years beginning after November 15, 2007, with earlier application allowed for entities that have not issued financial statements in the fiscal year of adoption. We are currently assessing the impact that the adoption of SFAS 157 will
have on our consolidated financial statements.

In February 2007, the FASB issued SFAS 159, The Fair Value Option for Financial Assets and
Liabilities (SFAS 159), which provides companies with an option to report selected financial assets and liabilities at fair value. The objective of SFAS 159 is to reduce both the complexity in accounting for financial instruments
and the volatility in earnings caused by measuring related assets and liabilities differently. SFAS 159 also establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement
attributes for similar assets and liabilities. This statement is effective as of the beginning of an entitys first fiscal year beginning after November 15, 2007. Early adoption is permitted as of the beginning of the previous year
provided that the company makes that choice in the first 120 days of that fiscal year and also elects to apply the provisions of SFAS 157. We are currently assessing the impact that the adoption of SFAS 159 will have on our consolidated financial
statements.



8



---

PFF BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

(Continued)



|(3) | Share-Based Payment Plans
|--- | -------------------------

2006 Equity Incentive Plan

During December 2007, our Board of Directors granted 80,000 stock options to a new executive officer. These options were granted at an exercise price
of $16.27 with cliff vesting on March 31, 2010 and a contractual term of 9.73 years. As of December 31, 2007, the remaining vesting period is 2.25 years and the remaining contractual term is 9.70 years.

The fair value of each option is estimated on the grant date using the Black-Scholes model that applies the following assumptions: volatility, based on the historical
volatility of our stock, is 32.95%; the expected term of options granted of five years represents the period of time the options are expected to be outstanding; the risk-free rate of 3.46% is the yield from United States government securities with
the same terms as the life of the options; and dividend yield of 6.71% is calculated using the anticipated dividend payout rate of the stock over the life of the option.

Compensation expense associated with these options was $2,000 for the three and nine months ended December 31, 2007 and the unrecognized compensation cost as of December 31, 2007 was $96,000.



9



---

PFF BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

(Continued)



|(4) | Earnings (Loss) Per Share
|--- | -------------------------

Earnings per share (EPS) is
calculated on both a basic and diluted basis, excluding common shares in treasury. Basic EPS is calculated by dividing net earnings (loss) available to common stockholders by the weighted average common shares outstanding during the period. Diluted
EPS includes the potential dilution resulting from the assumed exercise of stock options, including the effect of shares exercisable under our stock-based payment plans.

The following table presents a reconciliation of the numerators and denominators of the basic and diluted EPS computations for the three months ended December 31, 2007 and 2006.



|                                                                         |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     
|------------------------------------------------------------------------ |  | --------------------------------------------- | ------- | - | ------------------- | ---------- | --------------- | - | ----- | -------------------------- |  | ------------------- | ------ | --------------- | ---------- |  | - | ----
|                                                                         |  | For the Three Months Ended December 31,      
|                                                                         |  | 2007                                          |         |   | 2006               
|                                                                         |  | Earnings (Loss)(Numerator)                    |         |   | Shares(Denominator) |            | Per-ShareAmount |   |       | Earnings (Loss)(Numerator) |  | Shares(Denominator) |        | Per-ShareAmount
|                                                                         |  | (Dollars in thousands, except per share data)
|Net Earnings (Loss)                                                      |  | $                                             | (14,683 | ) |                     |            |                 |   |       |                            |  | $                   | 13,643 |                 |            |  |   |     
|Basic EPS                                                                |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     
|Earnings (loss) available to common stockholders                         |  |                                               | (14,683 | ) |                     | 22,592,898 |                 | $ | (0.65 | )                          |  |                     | 13,643 |                 | 24,557,623 |  | $ | 0.56
|                                                                         |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     
|Effect of Dilutive Securities                                            |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     
|Options and stock awards (1) (2)                                         |  |                                               |         |   |                     |           |                 |   |       |                            |  |                     |        |                 | 335,718    |  |   |     
|                                                                         |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     
|Diluted EPS                                                              |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     
|Earnings (loss) available to common stockholders and assumed conversions |  | $                                             | (14,683 | ) |                     | 22,592,898 |                 | $ | (0.65 | )                          |  | $                   | 13,643 |                 | 24,893,341 |  | $ | 0.55
|                                                                         |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     



|(1) | For the three months ended December 31, 2007, the dilutive effect of 34,818 shares was excluded from the computation of diluted earnings per share due to anti-dilution.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(2) | The exercise price of all options was less than the average market price of the common shares during the three month period ended December 31, 2006. As a result, there were no
options excluded from the computation of earnings per share due to anti-dilution.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



10



---

PFF BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

(Continued)



The following table presents a reconciliation of the numerators and denominators of the basic and diluted EPS
computations for the nine months ended December 31, 2007 and 2006.



|                                                                         |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     
|------------------------------------------------------------------------ |  | --------------------------------------------- | ------- | - | ------------------- | ---------- | --------------- | - | ----- | -------------------------- |  | ------------------- | ------ | --------------- | ---------- |  | - | ----
|                                                                         |  | For the Nine Months Ended December 31,       
|                                                                         |  | 2007                                          |         |   | 2006               
|                                                                         |  | Earnings (Loss)(Numerator)                    |         |   | Shares(Denominator) |            | Per-ShareAmount |   |       | Earnings (Loss)(Numerator) |  | Shares(Denominator) |        | Per-ShareAmount
|                                                                         |  | (Dollars in thousands, except per share data)
|Net Earnings (Loss)                                                      |  | $                                             | (21,674 | ) |                     |            |                 |   |       |                            |  | $                   | 43,111 |                 |            |  |   |     
|Basic EPS                                                                |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     
|Earnings (loss) available to common stockholders                         |  |                                               | (21,674 | ) |                     | 23,116,004 |                 | $ | (0.94 | )                          |  |                     | 43,111 |                 | 24,500,157 |  | $ | 1.76
|                                                                         |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     
|Effect of Dilutive Securities                                            |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     
|Options and stock awards (1) (2)                                         |  |                                               |         |   |                     |           |                 |   |       |                            |  |                     |        |                 | 318,977    |  |   |     
|                                                                         |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     
|Diluted EPS                                                              |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     
|Earnings (loss) available to common stockholders and assumed conversions |  | $                                             | (21,674 | ) |                     | 23,116,004 |                 | $ | (0.94 | )                          |  | $                   | 43,111 |                 | 24,819,134 |  | $ | 1.74
|                                                                         |  |                                               |         |   |                     |            |                 |   |       |                            |  |                     |        |                 |            |  |   |     



|(1) | For the nine months ended December 31, 2007, the dilutive effect of 150,275 shares was excluded from the computation of diluted earnings per share due to anti-dilution.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(2) | The exercise price of all options was less than the average market price of the common shares during the nine month period ended December 31, 2006. As a result, there were no
options excluded from the computation of earnings per share due to anti-dilution.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



11



---

PFF BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

(Continued)



|(5) | Other Borrowings
|--- | ----------------

During the quarter ended December 31, 2007, our
$75.0 million line of credit with a commercial bank matured and we renegotiated a line of credit of $60.0 million with the same commercial bank with a maturity date of August 31, 2008. See Item 1 - Business  Sources of Funds in our
March 31, 2007 Annual Report on Form 10-K. The covenants in the new line of credit included the following:



| |  |  | Bank and the Company must show a net profit on a rolling four-quarter basis;
| | - |  | ----------------------------------------------------------------------------



| |  |  | Bank and the Company must maintain at all times a ratio of non-performing loans (as defined) to total loans which is equal to or less than 6.00%, tested quarterly;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Bank and the Company must maintain well capitalized regulatory capital ratios, as required by federal regulators;
| | - |  | -----------------------------------------------------------------------------------------------------------------



| |  |  | Company must maintain a consolidated tangible net worth of not less than $320.0 million, tested quarterly;
| | - |  | ----------------------------------------------------------------------------------------------------------



| |  |  | Company shall not merge into or consolidate with any other business enterprises, or another business enterprise shall not merge into the Company, without prior
written consent of the lender;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | an event of default shall occur if the Company and/or Bank become subject to a Memorandum of Understanding a Cease and Desist Order or other
regulatory action that reflects any material adverse change in the safety and soundness of the Company and/or Bank;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | all obligations to lender shall become due and payable upon the sale of, or change in control of the Company or Bank; and
| | - |  | -------------------------------------------------------------------------------------------------------------------------



| |  |  | the Company shall maintain a demand deposit account balance in an amount not less than 2% of the note amount.
| | - |  | -------------------------------------------------------------------------------------------------------------

The Company is required to provide the lender with copies of (a) all quarterly Thrift Financial Reports of the Bank no later than the due date required by the Office of
Thrift Supervision, (b) a balance sheet and related statements of income and retained earnings and cash flow within 120 days after the end of each fiscal year and 45 days after the end of each quarter, and (c) asset quality reports with respect to
the Bank and each subsidiary within 45 days after the end of each quarter.

This line of credit is secured by a pledge of the stock of the Bank. The debt
relating to the Companys credit facility is classified as a component of FHLB advances and other borrowings in our Consolidated Balance Sheets.

As of December 31, 2007, the Company was in violation of the rolling four quarter net profit and non-performing loan covenants under this line of credit.

As of January 31, 2008, we entered into a new agreement that amended and restated in its entirety the $60.0 million line of credit. Under this new agreement, the $60.0 million line of credit was converted to a $49.4 million term note which
constituted the current principal balance outstanding on the date of the agreement. The maturity date of the note was amended to be May 31, 2008 and the interest rate is the one month LIBOR plus 3.25%. This note continues to be secured by a pledge
of the stock of the Bank.

The Company is required to make principal payments of $1.4 million by March 31, 2008 and $3.0 million by April 30, 2008 and is
required to make additional prepayments upon (a) the occurrence of a change in control of the Company or Bank which results in any change in ownership of 25% or more of the common or other stock of the Company; or (b) the Company ceasing to own 100%
of the capital stock of the Bank. Additionally, the Company is required to make prepayments upon receipt of any excess cash flow or dividends received by the Company from any subsidiary minus normal operating expenses of the Company and scheduled
payments on the Companys existing indebtedness. The Company shall not permit the sale of all or substantially all of the assets, or any capital stock, of any other subsidiary.

The amended covenants include the following:



| |  |  | Bank and the Company must maintain well capitalized regulatory capital ratios, as required by federal regulators;
| | - |  | -----------------------------------------------------------------------------------------------------------------



| |  |  | Company shall not merge into or consolidate with any other business enterprises, or another business enterprise shall not merge into the Company, without prior
written consent of the lender. Company shall not acquire all or substantially all of the assets of any other business enterprises, or acquire all or substantially all of the capital stock of any other business enterprises, without prior written
consent of lender;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | an event of default shall occur if the Company and/or Bank become subject to a Memorandum of Understanding a Cease and Desist Order or other
regulatory action that reflects any material adverse change in the safety and soundness of the Company and/or Bank;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the Company must provide prompt notice of the occurrence of any default or event of default under the credit agreement, any material adverse determination or
development in any litigation, arbitration or governmental proceeding, or any event which would have or could be expected to have a material adverse effect on the Company or any subsidiary;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the Company shall maintain a demand deposit account balance in an amount not less than 2.0% of the outstanding principal amount owed under the credit agreement;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the Company shall not pay any dividends, or make any other distributions, to its shareholders;
| | - |  | ----------------------------------------------------------------------------------------------



| |  |  | the Company shall suspend any stock repurchase plan, and shall not repurchase any shares of stock of the Company from any shareholder; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the Company and its subsidiaries shall not permit the creation of or existence of any lien or encumbrance on the capital stock, or any of the property or assets, of
any subsidiary.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The Company is required to provide the lender with copies of (a) all quarterly Thrift Financial Reports of the Bank no
later than the due date required by the Office of Thrift Supervision, (b) a balance sheet and related statements of income and retained earnings and cash flow within 120 days after the end of each fiscal year and 45 days after the end of each
quarter, and (c) asset quality reports with respect to the Bank and each subsidiary within 45 days after the end of each quarter.



12



---

PFF BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

(Continued)



|(6) | Derivative Hedging Activities
|--- | -----------------------------

On September 30, 2004, we
entered into an interest rate swap with a financial institution in the notional amount of $30.0 million for a period of five years. This interest rate swap was transacted concurrent with and for the purpose of hedging the cash outflows from $30.0
million of variable rate junior subordinated debentures against increasing interest rates. The terms of the interest rate swap require us to pay a fixed rate of 6.08 percent and receive three month LIBOR plus 2.20 percent quarterly on dates which
mirror those of the junior subordinated debentures through the termination of the interest rate swap on November 23, 2009. We recognize all derivatives on the balance sheet at fair value based on dealer quotes. At December 31, 2007, this
interest rate swap had a fair value of $(17,000) as compared to $821,000 at December 31, 2006. The periodic net settlement of this swap decreased interest expense by $118,000 and $364,000 for the three and nine months ended December 31,
2007 compared to $126,000 and $330,000 for the three and nine months ended December 31, 2006.

On September 16, 2005, we entered into an interest
rate swap with a financial institution in the notional amount of $10.0 million for a period of five years. This interest rate swap was transacted concurrent with and for the purpose of hedging the cash outflows from a portion of an additional $25.0
million of variable rate junior subordinated debentures against increasing interest rates. The terms of the interest rate swap require us to pay a fixed rate of 5.98 percent and receive three month LIBOR plus 1.52 percent quarterly on dates which
mirror those of the junior subordinated debentures through the termination of the interest rate swap on November 23, 2010. At December 31, 2007, this interest rate swap had a fair value of $(150,000) as compared to $137,000 at
December 31, 2006. The periodic net settlement of this swap decreased interest expense by $25,000 and $77,000 for the three and nine months ended December 31, 2007 compared to $27,000 and $65,000 for the comparable periods of 2006.

Hedge accounting is not applied and the change in fair value of both of these swaps is recorded in the Statement of Earnings (Loss).



|(7) | Allowance For Loan And Lease Losses
|--- | -----------------------------------

At December 31, 2007, the
allowance for loan and lease losses (ALLL) was $72.8 million or 1.81% of net loans and leases (loans and leases receivable, net plus allowance for loan and lease losses) compared to $46.3 million or 1.11% of net loans and leases at
March 31, 2007. At December 31, 2007, approximately $52.7 million of our total ALLL is assigned to our construction and land loan portfolio. As a percentage of committed and disbursed balances on construction and land loans, this
represents 3.4 percent and 4.3 percent, respectively. The ALLL is maintained at an amount management considers adequate to cover probable losses on loans and leases receivable. The determination of the adequacy of the ALLL is influenced to a
significant degree by the evaluation of the loan and lease portfolio by our internal asset review (IAR) function. The IAR system is designed to promptly identify problem loans and leases and probable losses. As the percentage of our loan
and lease portfolio comprised by the construction, commercial business, commercial real estate and consumer loans (the Four-Cs) has



13



---

PFF BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

(Continued)



increased, the IAR function has become increasingly important not only for the timely and accurate identification of probable losses, but also to minimize
our exposure to such losses through early intervention. Among the factors taken into account by the IAR function in identifying probable losses and determining the adequacy of the ALLL are the nature, level and severity of classified assets,
historical loss experience adjusted for current economic conditions, and composition of the loan and lease portfolio by type. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the
Banks ALLL. Such agencies may require the Bank to make additional provisions for loan and lease losses based upon information available at the time of the review. We will continue to monitor and modify our ALLL as economic conditions, loss
experience, changes in asset quality, portfolio composition and other factors dictate.

The following table sets forth activity in our ALLL.



|                                    |  |                                |         |   |                               |   |        |      |  |   |         |   |  |   |        |  
|----------------------------------- |  | ------------------------------ | ------- | - | ----------------------------- | - | ------ | ---- |  | - | ------- | - |  | - | ------ | -
|                                    |  | Three Months EndedDecember 31, |         |   | Nine Months EndedDecember 31, |  
|                                    |  | 2007                           |         |   | 2006                          |   |        | 2007 |  |   | 2006    |  
|                                    |  | (Dollars in thousands)         |        
|Beginning balance                   |  | $                              | 94,391  |   |                               | $ | 40,289 |      |  | $ | 46,315  |   |  | $ | 37,126 |  
|Provision for loan and lease losses |  |                                | 35,000  |   |                               |   | 1,900  |      |  |   | 90,800  |   |  |   | 4,920  |  
|Charge-offs                         |  |                                | (56,553 | ) |                               |   | (152   | )    |  |   | (64,370 | ) |  |   | (260   | )
|Recoveries                          |  |                                | 7       |   |                               |   | 69     |      |  |   | 100     |   |  |   | 320    |  
|                                    |  |                                |         |   |                               |   |        |      |  |   |         |   |  |   |        |  
|Ending balance                      |  | $                              | 72,845  |   |                               | $ | 42,106 |      |  | $ | 72,845  |   |  | $ | 42,106 |  
|                                    |  |                                |         |   |                               |   |        |      |  |   |         |   |  |   |        |  

The $56.6 million of charge-offs during the three months ended December 31, 2007 included $30.0 million of
specific valuation allowances established in previous quarters, which the Bank considers not collectible. The composition of the charge-offs during the three months ended December 31, 2007 was as follows: (i) first trust deeds secured by
residential construction and land of $40.9 million; (ii) one-to-four family residential properties of $3.3 million; (iii) commercial business loans of $11.8 million; and (iv) consumer loans of $575,000. The one-to-four family
residential and commercial business loan charge-offs were attributable principally to the single borrower relationship described in our September 30, 2007 Quarterly Report on Form 10-Q.

During the three months ended December 31, 2007, 8 construction and land loans with aggregate principal balances totaling $37.9 million were restructured in order
to maximize the recovery of our investment in these properties. These restructures resulted in charge-offs of $3.1 million. One of these loans totaling $9.7 million was restored to accrual status through restructure. The remainder of the loans will
be restored to accrual status after the passage of a sufficient period of time (generally six months) to provide evidence of performance under the new terms. Subsequent to December 31, 2007, an additional 12 loans with aggregate principal
balances totaling $58.6 million have been restructured. Charge-offs of $20.5 million attributable to these post December 31, 2007, restructures are included in the $56.6 million of total chargeoffs recorded for the quarter ended
December 31, 2007. In 19 of the 20 restructures prior or subsequent to December 31, 2007, the existing or new borrowers contributed additional cash to the projects in the form of principal paydowns, past due interest payments, deposits to
interest reserves and/or development costs. During the quarter ended December 31, 2007, we foreclosed on one single family loan of $563,000, and recorded a $17,000 loan charge-off, upon classification to assets acquired through foreclosure.



|(8) | Non-Accrual Loans
|--- | -----------------

Non-accrual loans were $235.2 million or 5.84
percent of net loans and leases (loans and leases receivable, net plus allowance for loan and lease losses) at December 31, 2007 compared to $11.4 million or 0.27 percent of net loans and leases at March 31, 2007 and $1.5 million or 0.04
percent of net loans and leases at December 31, 2006.

During the three months ended December 31, 2007, 61 loans totaling $76.6 million were
placed on non-accrual, 10 loans totaling $12.6 million were restored to accrual status and charge-offs against non-accrual loans totaled $55.0 million. Included in non-accrual loans at December 31, 2007 are $44.0 million in loans that are
current or less than ninety days past due, but are exhibiting weaknesses in the underlying collateral or borrower strength.



14



---

PFF BANCORP, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements

(Continued)



|(9) | Income Taxes
|--- | ------------

On April 1, 2007, we adopted the provisions of
FASB Interpretation No. 48 (FIN 48), Accounting for Uncertainty in Income Taxesan interpretation of FASB Statement No. 109. FIN 48 establishes a single model to address accounting for uncertain tax positions.
FIN 48 clarifies accounting for income taxes by prescribing a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. FIN 48 also provides guidance on derecognition, measurement
classification, interest and penalties, accounting in interim periods, disclosure and transition. As a result of our adoption of FIN 48, we had no cumulative effect adjustment. In addition, we do not have any unrecognized tax benefits as a result of
uncertainty in income taxes in our Consolidated Balance Sheets as of April 1, 2007 and December 31, 2007, and we do not anticipate any changes in the amount of unrecognized tax benefits prior to our fiscal year-end.

We file income tax returns with U.S. Federal and State of California jurisdictions. It is our policy to record any penalties or interest arising from federal or state
taxes as a component of income tax expense. There were no penalties related to income taxes included in the Consolidated Statements of Earnings (Loss), but we had a reduction of interest expense of $314,000 and $458,000 for the three and nine months
ended December 31, 2007, respectively. Upon adoption of FIN 48, we included interest payable of $197,000 in the Consolidated Balance Sheet as of April 1, 2007. Included in the Consolidated Balance Sheet as of December 31, 2007 is
interest receivable of $261,000 related to amended income tax returns.

During our fiscal 3rd quarter, the Internal Revenue Service concluded their
examination of our tax years ended March 31, 2002 through 2004. Accordingly, tax years ended on or after March 31, 2005 remain open to examination by federal authorities. Tax years ending March 31, 2002, and thereafter remain open to
examination by state authorities.



15



---

|Item 6. | Exhibits.
|------- | ---------



|            |  |                                                                                                                                                   
|----------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                                       
|            | 
|15.1        |  | Awareness Letter of KPMG LLP.                                                                                                                     
|            | 
|31.1        |  | Certification of Principal Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002.                                               
|            | 
|31.2        |  | Certification of Principal Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002.                                               
|            | 
|32.1        |  | Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of Sarbanes-Oxley Act of 2002.
|            | 
|32.2        |  | Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of Sarbanes-Oxley Act of 2002.



---

PFF BANCORP, INC. AND SUBSIDIARIES

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant
has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



|                      |  |                   |  |                                                
|--------------------- |  | ----------------- |  | -----------------------------------------------
|                      |  | PFF BANCORP, INC.
|                      |  |                  
|DATED: April 10, 2008 |  | BY:               |  | /s/ KEVIN MCCARTHY                             
|                      |  |                   |  | Kevin McCarthy                                 
|                      |  |                   |  | President and Chief Executive Officer          
|                      |  |                   |  | (Principal Executive Officer)                  
|                      |  |                  
|                      |  |                   |  |                                                
|                      |  |                  
|DATED: April 10, 2008 |  | BY:               |  | /s/ GREGORY C. TALBOTT                         
|                      |  |                   |  | Gregory C. Talbott                             
|                      |  |                   |  | Senior Executive Vice President,               
|                      |  |                   |  | Chief Operating Officer/Chief Financial Officer
|                      |  |                   |  | and Treasurer                                  
|                      |  |                   |  | (Principal Financial Officer)