<PAGE>
 
                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D. C. 20549

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

                                   FORM 10-Q

[Mark One]
[ X ]      QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
           ACT OF 1934

      For the quarterly period ended March 31, 1999

[   ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE  EXCHANGE ACT

      For the transition period from ____________ to _________________


                        Commission File Number 0-27672

                        NORTH CENTRAL BANCSHARES, INC.
            (Exact name of registrant as specified in its charter)

               Iowa                                42-1449849
               ----------------------------------------------
       (State or other jurisdiction of         (I. R. S. Employer
        incorporation or organization)       Identification Number)


               825 Central Avenue          Fort Dodge, Iowa 50501
               --------------------------------------------------
                    (Address of principal executive offices)

       Registrant's telephone number, including area code #(515)576-7531

                                      None
--------------------------------------------------------------------------------
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 Exchange Act of 1934 during
the past 12 months (or for such shorter period that the Registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.  Yes  X    No ___
                       ----        

     Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

              Class                           Outstanding at May 14, 1999
-------------------------------------------------------------------------

(Common Stock, $.01 par value)                         2,765,242
<PAGE>
 
                        NORTH CENTRAL BANCSHARES, INC.

                                     INDEX

<TABLE> 
<CAPTION> 
                                                                        Page
<S>                                                                    <C> 
PART I. FINANCIAL INFORMATION
 
          Item 1. Consolidated Condensed
          Financial Statements (Unaudited)                             1 to 4
 
               Consolidated Condensed Statements of
               Financial Condition at March 31,
               1999 and December 31, 1998 (Unaudited)                  1
 
               Consolidated Condensed Statements of
               Income for the three months ended
               March 31, 1999 and 1998 (Unaudited)                     2
 
               Consolidated Condensed Statements of
               Cash Flows for the three months ended
               March 31, 1999 and 1998 (Unaudited)                     3 & 4
 
          Notes to Consolidated Condensed Financial
          Statements                                                   5 & 6
 
          Item 2. Management's Discussion and Analysis
          of Financial Condition and Results of
          Operations                                                   7 to 14
 
          Item 3. Quantitative and Qualitative Disclosures
          About Market Risk                                            14
 
PART II.  OTHER INFORMATION                                            15 & 16
 
          Items 1 through 6                                            15
 
          Signatures                                                   16

          Exhibits
</TABLE> 
<PAGE>
 
PART 1.    FINANCIAL INFORMATION
ITEM 1.
NORTH CENTRAL BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL CONDITION 
(UNAUDITED)

<TABLE>
<CAPTION>
ASSETS                           
                                                                              March 31,    December 31, 
                                                                               1999           1998      
<S>                                                                          -----------  -------------
Cash:                                                                        <C>          <C>                             
 Interest-bearing                                                            $ 10,529,198    $ 13,201,437
 Noninterest-bearing                                                            1,532,558       2,435,439 
Securities available for sale                                                  52,292,839      49,882,544 
Loans receivable, net                                                         254,086,234     254,032,497    
Loans held for sale                                                               564,958       1,681,017 
Accrued interest receivable                                                     1,952,866       1,933,237 
Foreclosed real estate                                                            268,671         186,931 
Premises and equipment, net                                                     3,876,157       3,616,438 
Rental real estate                                                              1,920,907       1,945,851 
Title plant                                                                       925,256         925,256 
Goodwill                                                                        6,269,598       6,387,671 
Deferred taxes                                                                    204,317          13,490 
Prepaid expenses and other assets                                                 559,419         448,331 
                                                                             ------------    ------------ 

                                                                             $334,982,978    $336,690,139 
 TOTAL ASSETS                                                                ============    ============ 
                                                                             
                                                                             
LIABILITIES AND STOCKHOLDERS' EQUITY                                         
                                                                              
LIABILITIES                                                                                                  
 Deposits                                                                    $245,721,303    $246,690,313
 Other borrowed funds                                                          37,804,569      38,832,239
 Advances from borrowers for taxes and insurance                                  614,669       1,066,025
 Dividend payable                                                                 295,724         237,133
 Income taxes payable                                                             802,478         199,224
 Accrued expenses and other liabilities                                           988,148       1,458,391
                                                                             ------------    ------------
   TOTAL LIABILITIES                                                          286,226,891     288,483,325
                                                                             ------------    ------------
 
 
COMMITMENTS AND CONTINGENCIES
 
STOCKHOLDERS' EQUITY
 Preferred stock ($.01 par value, authorized 3,000,000 shares,
   issued and outstanding none)                                                        --             -- 
 Common Stock ($.01 par value, authorized 15,500,000 shares;
   issued and outstanding 4,011,057)                                               40,111          40,111
 Additional paid-in capital                                                    38,171,550      38,135,817
 Retained earnings, substantially restricted                                   27,856,928      27,084,907
 Accumulated other comprehensive income-unrealized gain on securities
  available for sale, net of income taxes                                         178,672         358,666
 
 Treasury stock at cost (1,053,815 and 1,046,608 shares, respectively)        (16,525,525)    (16,399,403)
 Unearned shares, employee stock ownership plan                                  (965,649)     (1,013,284)
                                                                             ------------    ------------
   Total stockholders' equity                                                  48,756,087      48,206,814
                                                                             ------------    ------------
 
     Total liabilities and stockholders' equity                              $334,982,978    $336,690,139
                                                                             ============    ============
</TABLE>

   See Notes to Consolidated Condensed Financial Statements.
 
                                      -1-
<PAGE>
 
NORTH CENTRAL BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF INCOME 
(Unaudited)

<TABLE>
<CAPTION>
                                                          Three Months Ended
                                                              March 31,
                                                          1999         1998
                                                       -----------  -----------
<S>                                                    <C>          <C>
Interest income:
 Loans receivable                                       $5,099,590   $4,749,038
 Securities and cash deposits                              867,178      716,182
                                                        ----------   ----------
                                                         5,966,768    5,465,220
                                                        ----------   ----------
Interest expense:
 Deposits                                                2,665,780    2,393,317
 Other borrowed funds                                      533,735      479,432
                                                        ----------   ----------
                                                         3,199,515    2,872,749
                                                        ----------   ----------
 
 Net Interest Income                                     2,767,253    2,592,471
 
Provision for loan losses                                   30,000       60,000
                                                        ----------   ----------
 
Net interest income after provision for loan losses      2,737,253    2,532,471
                                                        ----------   ----------
 
Noninterest income:
 Fees and service charges                                  361,338      237,619
 Abstract fees                                             343,473      361,098
 Gain on sale of securities available for sale, net            - -       54,853
 Other income                                              215,438      161,772
                                                        ----------   ----------
 
    Total noninterest income                               920,249      815,342
                                                        ----------   ----------
 
Noninterest expense:
 Salaries and employee benefits                            973,004      770,569
 Premises and equipment                                    207,334      153,215
 Data processing                                           147,932       99,231
 SAIF deposit insurance premiums                            37,415       32,490
 Goodwill amortization                                     118,070       79,609
 Other expenses                                            570,554      499,316
                                                        ----------   ----------
 
    Total noninterest expense                            2,054,309    1,634,430
                                                        ----------   ----------
 
Income before income taxes                               1,603,193    1,713,383
 
Provision for income taxes                                 545,501      607,880
                                                        ----------   ----------
 
Net Income                                              $1,057,692   $1,105,503
                                                        ==========   ==========
 
Basic earnings per common share                         $     0.37   $     0.35
                                                        ==========   ==========
 
Diluted earnings per common share                        $    0.36   $     0.34
                                                        ==========   ==========
 
Dividends declared per common share                      $    0.10   $     0.08
                                                        ==========   ==========
</TABLE>

 See Notes to Consolidated Condensed Financial Statements.

                                      -2-
<PAGE>
 
NORTH CENTRAL BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)

<TABLE>
<CAPTION>
                                                                                          THREE MONTHS ENDED
                                                                                              MARCH 31,
 
                                                                                         1999           1998
                                                                                     -------------  -------------
<S>                                                                                  <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES
 
Net income                                                                            $ 1,057,692    $ 1,105,503
Adjustments to reconcile net income to net cash provided by operating activities:
 Provision for loan losses                                                                 30,000         60,000
 Depreciation                                                                             122,943         89,746
 Amortization and accretion                                                                19,814        123,818
 Deferred taxes                                                                           (59,507)       (44,835)
 Effect of contribution to employee stock ownership plan                                   83,368        106,742
 (Gain) on sale of foreclosed real estate and loans, net                                   (8,372)        (2,560)
 (Gain) on sale of securities available for sale                                               --        (54,853)
 Loss on sale and disposal of equipment, net                                               14,101             --
 Net (increase) decrease in loans held for sale                                         1,116,059       (117,042)
 Change in assets and liabilities:
   (Increase) decrease in accrued interest receivable                                     (19,629)        32,241
   (Increase) decrease in prepaid expenses and other assets                              (111,088)       278,999
   Increase in income taxes payable                                                       603,254        657,608
   Increase (decrease) in accrued expenses and other liabilities                         (470,243)        20,979
                                                                                      -----------    -----------
        Net cash provided by operating activities                                       2,378,392      2,256,346
                                                                                      -----------    -----------
 
CASH FLOWS FROM INVESTING ACTIVITIES
 Net decrease in loans                                                                  8,983,457      3,523,166
 Purchase of loans                                                                     (9,102,362)    (1,655,000)
 Proceeds from sales of securities available for sale                                          --      3,485,697
 Purchase of securities available for sale                                             (8,441,322)    (4,050,821)
 Proceeds from maturities of securities available for sale                              5,786,768      5,574,472
 Purchase of premises and equipment and rental real estate                               (372,016)       (39,031)
 Proceeds from sale of equipment                                                              197             --
 Cash paid in connection with acquisition of Valley Financial Corporation
   net of cash received                                                                        --     (8,532,270)
 Other                                                                                     (6,996)        (1,992)
                                                                                      -----------    -----------
       Net cash (used in) investing activities                                         (3,152,274)    (1,695,779)
                                                                                      -----------    -----------
 
CASH FLOWS FROM FINANCING ACTIVITIES
 Net increase (decrease) in deposits                                                     (969,010)     4,347,777
 (Decrease) in advances from borrowers for taxes and insurance                           (451,356)      (612,311)
 Proceeds from other borrowed funds                                                           - -      8,042,000
 Payments of other borrowings                                                          (1,027,670)    (3,000,000)
 Purchase of treasury stock                                                              (126,122)           - -
 Dividends paid                                                                          (227,080)      (194,954)
                                                                                      -----------    -----------
 
      Net cash provided by (used in) financing activities                              (2,801,238)     8,582,512
                                                                                      -----------    -----------
 
      Net increase (decrease) in cash                                                  (3,575,120)     9,143,079
 
CASH
 Beginning                                                                             15,636,876      3,445,163
                                                                                      -----------    -----------
 Ending                                                                               $12,061,756    $12,588,242
                                                                                      ===========    ===========
 
SUPPLEMENTAL SCHEDULE OF CASH FLOW INFORMATION
Cash payments for:
 Interest paid to depositors                                                          $ 2,730,040    $ 2,331,593
 Interest paid on borrowings                                                              533,641        479,432
 Income taxes                                                                               1,754             85
</TABLE>
                                  (Continued)

                                      -3-
<PAGE>
 
The following is a summary of the assets acquired and liabilities assumed in
connection with the acquisition of Valley Financial Corporation

<TABLE>
 <S>                                               <C>
 Cash                                              $  6,157,507
 Securities                                          41,818,057
 Loans                                               58,567,364
 Accrued interest receivable                          1,019,373
 Premises and equipment                               1,081,890
 Goodwill                                             6,565,174
 Prepaid expenses and other assets                      209,906
 Deposits                                           (99,261,995)
 Advances from borrowers for taxes and insurance       (301,783)
 Deferred income taxes                                 (300,030)
 Accrued taxes payable                                   12,565
 Accrued expenses and other liabilities                (878,251)
                                                   ------------
 
   Cash Paid                                       $ 14,689,777
   Less Cash Received                                (6,157,507)
                                                   ------------
   Cash Paid, net of cash received                 $  8,532,270
                                                   ============
</TABLE>

See Notes to Consolidated Condensed Financial Statements

                                      -4-
<PAGE>
 
ITEM 1.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
NORTH CENTRAL BANCSHARES, INC. AND SUBSIDIARIES

1.   SIGNIFICANT ACCOUNTING POLICIES

The consolidated condensed financial statements for the three month period ended
March 31, 1999 and 1998 are unaudited. In the opinion of the management of North
Central Bancshares, Inc. (the "Company" or the "Registrant") these financial
statements reflect all adjustments, consisting only of normal recurring
accruals, necessary to present fairly these consolidated financial statements.
The results of operations for the interim periods are not necessarily indicative
of results which may be expected for an entire year. Certain information and
footnote disclosure normally included in complete financial statements prepared
in accordance with generally accepted accounting principles have been omitted in
accordance with the requirements for interim financial statements. The financial
statements and notes thereto should be read in conjunction with the Company's
1998 Annual Report on Form 10-K.

The consolidated condensed financial statements include the accounts of the
Company and its wholly-owned subsidiaries (See Note 2). All significant
intercompany balances and transactions have been eliminated in consolidation.

2.   REORGANIZATION

The Company was organized on December 5, 1995 at the direction of the Board of
Directors of First Federal Savings Bank of Iowa, formerly known as First Federal
Savings Bank of Fort Dodge, (the "Bank") for the purpose of acquiring all of the
capital stock of the Bank, in connection with the conversion of the Bank and
North Central Bancshares, M.H.C. (the "Mutual Holding Company" or "MHC") from
the mutual to the stock holding company structure (these transactions are
collectively referred to as the "Reorganization"). On March 20, 1996, upon
completion of the Reorganization, the Company issued an aggregate of 4,011,057
shares of its common stock, 1,385,590 shares of which were issued in exchange
for all of the Bank's issued and outstanding shares, except for shares owned by
the MHC which were canceled, and 2,625,467 shares of which were sold in
Subscription and Community Offerings (the "Offering") at a price of $10.00 per
share, with gross proceeds amounting to $26.3 million. In addition, the Company
replaced the Bank as the issuer listed on The Nasdaq Stock Market.

At this time, the Company conducts business as a unitary savings and loan
holding company and the principal business of the Company consists of the
operation of its wholly owned subsidiary, the Bank.

3.   ACQUISITION OF VALLEY FINANCIAL CORP.

As of the close of business on January 30, 1998, the Bank completed the
acquisition of Valley Financial Corp., ("Valley Financial") (the "Acquisition")
pursuant to an Agreement and Plan of Merger, dated as of September 18, 1997 (the
"Merger Agreement"). The acquisition resulted in the merger of Valley
Financial's wholly owned subsidiary, Valley Savings Bank, FSB ("Valley Savings")
with and into the Bank, with the Bank as the resulting financial institution.
Valley Savings, headquartered in Burlington, Iowa, was a federally-charted stock
savings bank with three branch offices located in southeastern Iowa. The former
offices of Valley Savings are being operated as a division of the Bank.

In connection with the Acquisition, each share of Valley Financial's common
stock, par value $1.00 per share, issued and outstanding (other than shares held
as treasury stock of Valley Financial) was canceled and converted automatically
into the right to receive $525 per share in cash pursuant to the terms and
conditions of the Merger Agreement. As a result of the Acquisition, shareholders
of Valley Financial were paid a total of $14.7 million in cash. The Acquisition
was accounted for as a purchase transaction, resulting in goodwill of $6.6
million. The operating results of the former offices of Valley Savings are
included in the 1998 operating results of the Company only from the date of
acquisition through March 31, 1998.

                                      -5-
<PAGE>
 
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (UNAUDITED)(Continued)

4.   EARNINGS PER SHARE

The earnings per share amounts were computed using the weighted average number
of shares outstanding during the periods presented. In accordance with Statement
of Position No. 93-6, Employers' Accounting for Employee Stock Ownership Plans,
issued by the American Institute of Certified Public Accountants, shares owned
by the Bank's Employee Stock Ownership Plan that have not been committed to be
released are not considered to be outstanding for the purpose of computing
earnings per share. For the three month period ended March 31, 1999, the
weighted average number of shares outstanding for basic and diluted earnings per
share computation were 2,854,867 and 2,912,166, respectively. For the three
month period ended March 31, 1998, the weighted average number of shares
outstanding for basic and diluted earnings per share computation were 3,140,815
and 3,233,867, respectively.

5.   DIVIDENDS

On February 26, 1999, the Company declared a cash dividend on its common stock,
payable on April 6, 1999 to stockholders of record as of March 16, 1999, equal
to $0.10 per share.

6.   COMPREHENSIVE INCOME

Comprehensive income for the three months ended March 31, 1999 and 1998 was
$877,698 and $1,062,037, respectively.

                                      -6-
<PAGE>
 
ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

EXPLANATORY NOTE

This Quarterly Report on Form 10-Q contains forward-looking statements
consisting of estimates with respect to the financial condition, results of
operations and business of the Company that are subject to various factors which
could cause actual results to differ materially from these estimates. These
factors include changes in general, economic, market, legislative and regulatory
conditions, and the development of an interest rate environment that adversely
affects the interest rate spread or other income anticipated from the Company's
operations and investments. The Company's actual results may differ from the
results discussed in the forward looking statements.

ACQUISITION OF VALLEY FINANCIAL CORP.

On September 18, 1997, the Company announced the execution of a definitive
agreement to acquire Valley Financial, a privately held Iowa corporation and
parent company of Valley Savings, Burlington, Iowa. As of the close of business
on January 30, 1998, the Bank completed the Acquisition. Under the terms of the
Merger Agreement, the Bank was acquired in a cash transaction totalling $14.7
million, or $525 per share, of all 28,050 shares outstanding of Valley
Financial's common stock.

Valley Savings was a federally chartered savings bank, with two offices in
Burlington, Iowa and one office in Mount Pleasant, Iowa. At January 30, 1998,
just prior to the merger, Valley Financial had assets of $108.0 million, loans
of $57.9 million and deposits of $98.9 million.

The acquisition of Valley Financial resulted in the merger of Valley Financial's
wholly-owned subsidiary, Valley Savings, with and into the Bank, with the three
Valley Savings branches continuing to operate as Valley Savings Bank, a division
of First Federal Savings Bank of Iowa. The transaction was accounted for as a
purchase, resulting in goodwill of $6.6 million and closed on January 30, 1998,
consequently the operating results of the former Valley Savings are included in
the 1998 operating results of the Company only from the date of acquisition
through March 31, 1998.

FINANCIAL CONDITION

Total assets decreased $1.7 million, or 0.5%, to $335.0 million at March 31,
1999 compared to $336.7 million at December 31, 1998. Interest bearing cash
decreased $2.7 million, or 20.2%. Securities available for sale increased $2.4
million, or 4.8%, primarily due to $8.4 million of purchases, partially offset
by $5.8 million of maturities and calls. Total loans receivable, net, increased
by $54,000 from December 31, 1998, due primarily to payments and prepayments of
loans (of approximately $21.3 million) and loan sales of $381,000, which
payments, prepayments and sales were offset in part by originations of $7.6
million of first mortgage loans secured primarily by one-to-four family
residences, purchases of $9.1 million of first mortgage loans secured primarily
by multi-family residences and commercial real estate and originations of $3.6
million of second mortgage loans. Deposits decreased $969,000, or 0.4%, from
$246.7 million at December 31, 1998 to $245.7 million at March 31, 1999,
reflecting decreases primarily in NOW accounts. This decrease was due in part to
the timing of certain deposits to NOW accounts at December 31, 1998. Other
borrowings, primarily FHLB advances, decreased by $1.0 million to $37.8 million
at March 31, 1999 from $38.8 million at December 31, 1998, due to the repayment
of an advance. Total stockholders' equity increased $549,000, to $48.8 million
at March 31, 1999 from $48.2 million at December 31, 1998. See "Capital".

                                      -7-
<PAGE>
 
CAPITAL

The Company's total stockholders' equity increased by $549,000 to $48.8 million
at March 31, 1999 from $48.2 million at December 31, 1998, primarily due to
earnings, which were offset in part by stock repurchases and dividends declared.
The changes in stockholders' equity were also due to an decrease in the
unrealized gain on securities available for sale by $180,000 to $179,000 at
March 31, 1999 from $359,000 at December 31, 1998. The unearned shares from the
Employee Stock Ownership Plan (the "ESOP") decreased by $48,000 to $966,000 at
March 31, 1999 from $1,013,000 at December 31, 1998, due to the release of
shares by the ESOP to employees of the Bank.

The Office of Thrift Supervision (the "OTS") requires that the Bank meet minimum
tangible, leverage (core) and risk-based capital requirements. As of March 31,
1999, the Bank exceeded all of its regulatory capital requirements. The Bank's
required, actual and excess capital levels as of March 31, 1999 are as follows:


                            Amount          Percentage of Assets
                        --------------   --------------------------     
                            (dollars in thousands)

Tangible capital:
 Capital level         $     30,438                  9.32%
 Less Requirement             4,900                  1.50%
                            -------                  -----
 Excess                $     25,538                  7.82%
                            =======                  =====
                                                          
Core capital:                                             
 Capital level         $     30,438                  9.32%
 Less Requirement            13,068                  4.00%
                            -------                  -----
 Excess                $     17,370                  5.32%
                            =======                  =====
                                                          
Risk-based capital:                                       
 Capital level         $     32,649                  18.74%
 Less Requirement            13,936                   8.00%
                            -------                  -----
 Excess                $     18,713                  10.74%
                            =======                  ===== 

LIQUIDITY

The Company's primary sources of funds are cash provided by operating activities
(including net income), certain financing activities (including increases in
deposits and proceeds from borrowings) and certain investing activities
(including principal payments on loans and maturities and calls of securities).
During the first three months of 1999 and 1998, principal payments and
repayments on loans totalled $21.3 million and $13.5 million, respectively. The
increase in loan payments and repayments is due to the current low interest rate
environment. The net increase (decrease) in deposits during the first three
months of 1999 and 1998 totalled $(969,000) and $4.3 million, respectively. The
proceeds from borrowed funds during the first three months ended March 31, 1999
and 1998 totalled none and $8.0 million, respectively. During the first three
months of 1999 and 1998, the proceeds from the maturities, calls and sales of
securities totalled $5.8 million and $9.1 million, respectively. The decrease in
proceeds from securities is due in part to the sales of certain investments in
1998 of which there were none in 1999. Cash provided from operating activities
during the first three months of 1999 and 1998 totalled $2.4 million and $2.3
million, respectively, of which $1.1 million and $1.1 million, respectively,
represented net income of the Company. The Company's primary use of funds is
cash used to originate and purchase loans, purchase of securities available for
sale, repayment of borrowed funds and other financing activities. During the
first three months of 1999 and 1998, the Company's gross purchases and
origination of loans totalled $22.3 million and $13.5 million, respectively. The
increase in purchase and origination of loans is due to the current low interest
rate environment. The purchase of securities available for sale for the three
months ended March 31, 1999 and 1998 totalled $8.4 million and $4.1 million,
respectively. The repayment of borrowed funds during the first three months of
1999 and 1998 totalled $1.0 million and $3.0 million, respectively. For
additional information about cash flows from the Company's operating, financing
and investing activities, see "Statements of Cash Flows in the Condensed
Consolidated Financial Statements."

                                      -8-
<PAGE>
 
The Bank is required to maintain an average daily balance of liquid assets
(cash, certain time deposits, bankers' acceptances, specified United States
Government, state or federal agency obligations, shares of certain mutual funds
and certain corporate debt securities and commercial paper) in each calendar
quarter of not less than four percent of either (1) the liquidity base at the
end of the preceding quarter, or (2) the average daily balance of the liquidity
base during the preceding quarter equal to a specified percentage of its net
withdrawable deposit accounts plus short-term borrowings. This liquidity
requirement may be changed from time to time by the OTS to any amount within the
range of 4.0% to 10%, depending upon economic conditions and the savings flows
of member institutions, and is currently 4.0%. Monetary penalties may be imposed
for failure to meet these liquidity requirements. At March 31, 1999, the Bank's
liquidity position was $44.7 million, or 17.1%, of liquid assets, compared to
$45.7 million, or 17.6%, at December 31, 1998.

Stockholders' equity totaled $48.8 million at March 31, 1999 compared to $48.2
million at December 31, 1998, reflecting the Company's earnings for the quarter,
stock repurchases, the amortization of the unallocated portion of shares held by
the ESOP, dividends declared on common stock and the change in the net
unrealized gains on securities, net of taxes.

On January 6, 1999, the Company paid a quarterly cash dividend equal to $0.08
per share on common stock outstanding as of the close of business on December
16, 1998, aggregating $237,000. On February 26, 1999, the Company declared a
quarterly cash dividend of $0.10 per share payable on April 6, 1999 to
shareholders of record as of the close of business on March 16, 1999,
aggregating $296,000.

PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF INCOME (UNAUDITED)

The following unaudited pro forma consolidated statement of income for the three
months ended March 31, 1998 presented on the following page is based on the
historical income statements of the Company and Valley Financial. The unaudited
pro forma consolidated statement of income for the three months ended March 31,
1998 was prepared as if the Acquisition had occurred as of the beginning of the
respective period for purposes of the combined consolidated statements of
income.

This pro forma income statement is not necessarily indicative of the results of
operations that might have occurred had the Acquisition taken place at the
beginning of the period, or to project the Company's results of operations at
any future date or for any future period. The pro forma consolidated condensed
statement of income should be read in connection with the notes thereto.

                                      -9-
<PAGE>
 
NORTH CENTRAL BANCSHARES, INC. AND SUBSIDIARIES
-----------------------------------------------

CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Unaudited)

<TABLE>
<CAPTION>
                                                          Three Months Ended
                                                              March 31,

                                                         ACTUAL      PRO FORMA
                                                          1999         1998
                                                       -----------  -----------
<S>                                                    <C>          <C>
Interest income                                         $5,966,768   $6,087,529
Interest expense                                         3,199,515    3,322,829
                                                        ----------   ----------
 
   Net interest income                                   2,767,253    2,764,700
 
Provision for loan losses                                   30,000       60,000
                                                        ----------   ----------
Net interest income after provision for loan losses      2,737,253    2,704,700
                                                        ----------   ----------
 
Noninterest income:
   Fees and service charges                                361,338      273,524
   Abstract fees                                           343,473      361,098
   Gain on sale of securities available for sale                --       54,853
      Other income                                         215,438      186,990
                                                        ----------   ----------
     Total noninterest income                              920,249      876,465
                                                        ----------   ----------
 
 
Noninterest expense:
   Salaries and employee benefits                          973,004      938,514
   Premises and equipment                                  207,334      187,713
   Data processing                                         147,932      129,054
   SAIF deposit insurance premiums                          37,415       37,784
   Goodwill amortization                                   118,070      115,920
   Other expenses                                          570,554      579,147
                                                        ----------   ----------
      Total noninterest expense                          2,054,309    1,988,132
                                                        ----------   ----------
 
Income before income taxes                               1,603,193    1,593,033
 
Provision for income taxes                                 545,501      587,759
                                                        ----------   ----------
 
Net Income                                              $1,057,692   $1,005,274
                                                        ==========   ==========
</TABLE>

RESULTS OF OPERATIONS

The actual statement of income for the three months ended March 31, 1999 was
used for comparison purposes to the pro forma statement of income for the three
months ended March 31 1998 in order to more clearly present the changes in the
results of operations.

INTEREST INCOME. Interest income decreased by $121,000 to $6.0 million for the
three months ended March 31, 1999 compared to $6.1 million for the three months
ended March 31, 1998. The decrease in interest income was primarily due to a
decrease in the average yield on interest earning assets from 7.72% for the
three months ended March 31, 1998 to 7.56% for the three months ended March 31,
1999. The average yields on interest bearing assets declined due to a general
decrease in the market interest rates. The impact of the decrease in average
yields was offset in part by an increase in the average balance of interest
earning assets . The average balance of interest bearing assets increased
$803,000 (primarily first mortgage and consumer loans and interest bearing cash)
to $316.8 million for the three months ended March 31, 1999 from $316.0 million
for the comparable 1998 period. The increase in the average balance of loans
generally reflects an increase over the past twelve months in originations of
first and second mortgage loans and purchases of first mortgage loans secured
primarily by multi-family residences and commercial

                                      -10-
<PAGE>
 
RESULTS OF OPERATIONS (Continued)

real estate, which were offset, in part, by payments and prepayments on such
loans. See "Financial Condition." The impact of the increase in the average
balances of loans was offset in part by a decrease in the average balance of
securities available for sale. The decrease in the average balance of securities
available for sale was due to sales, calls and maturities, which were offset, in
part, by purchases of available for sale securities.

INTEREST EXPENSE. Interest expense decreased by $123,000 to $3.2 million for the
three months ended March 31, 1999 compared to $3.3 million for the three months
ended March 31, 1998. The decrease in interest expense was primarily due to a
decrease in the average cost of interest bearing liabilities from 4.91% for the
three months ended March 31, 1998 to 4.64% for the three months ended March 31,
1999. The average cost of interest bearing liabilities declined due to a general
decrease in the market interest rates. The impact of the decrease in average
cost of interest bearing liabilities was offset in part by an increase in the
average balance of interest bearing liabilities . The increase in the average
balance of interest bearing liabilities was primarily due to a $4.2 million
increase in the average balance of NOW and money market savings accounts. The
increase in such deposit accounts is due to marketing of the Company's NOW
accounts.

NET INTEREST INCOME. Net interest income before the provision for loan losses
increased by $3,000 to $2.8 million for the three months ended March 31, 1999
from $2.8 million for the three months ended March 31, 1998. The increase is
primarily due to the increase in the interest rate spread, offset by the
decrease in the excess of average interest earning assets over the average
interest bearing liabilities. The interest rate spread (i.e., the difference in
the average yield on assets and average cost of liabilities) increased to 2.92%
for the three months ended March 31, 1999 from 2.81% for the three months ended
March 31, 1998.

The following table sets forth certain information relating to the Company's
actual and pro forma average balance sheets and reflects the actual and pro
forma average yield on assets and actual and pro forma average cost of
liabilities for the three month periods ended March 31, 1999 and 1998,
respectively.

                                      -11-
<PAGE>
 
RESULTS OF OPERATIONS (Continued)

<TABLE>
<CAPTION>
                                                                          FOR THREE MONTHS ENDED MARCH 31,
                                                         ------------------------------------------------------------------
                                                                      ACTUAL                            PRO FORMA
                                                                       1999                                 1998
                                                         ------------------------------------------------------------------
                                                          AVERAGE               AVERAGE     AVERAGE               AVERAGE
                                                          BALANCE   INTEREST  YIELD/COST    BALANCE   INTEREST  YIELD/COST
                                                          -------   --------  ----------    -------   --------  ----------
                                                                              (Dollars in thousands)
<S>                                                      <C>        <C>       <C>          <C>        <C>       <C>
ASSETS:
Interest-earning assets:
     Loans..........................................      $254,270    $5,100        8.04%   $250,567    $5,154        8.23%
     Securities available for sale..................        50,428       730        5.86      58,497       844        5.85
     Interest bearing cash..........................        12,099       137        4.60       6,930        90        5.24
                                                          --------    ------      ------    --------    ------      ------
       Total interest-earning assets................       316,797    $5,967        7.56%    315,994    $6,088        7.72%
                                                                      ------      ------                ------      ------
   Noninterest-earning assets.......................        17,430                            18,383
                                                          --------                          --------
       Total assets.................................      $334,227                          $334,377
                                                          ========                          ========

LIABILITIES AND EQUITY:
   Interest-bearing liabilities:
     NOW and money market savings...................      $ 50,825    $  276        2.20%   $ 46,658    $  360        3.13%
     Passbook savings...............................        26,570       148        2.26      26,200       155        2.39
     Certificates of deposit........................       163,572     2,242        5.56     163,690     2,254        5.58
     Borrowed funds.................................        38,150       534        5.60      37,642       554        5.98
                                                          --------    ------      ------    --------    ------      ------
   Total interest-bearing liabilities...............       279,117    $3,200        4.64%    274,190    $3,323        4.91%
                                                                      ------      ------                ------      ------

   Noninterest-bearing liabilities..................         6,522                             9,206
                                                          --------                          --------
       Total liabilities............................       285,639                           283,396
   Equity...........................................        48,635                            50,981
                                                          --------                          --------
       Total liabilities and equity.................      $334,227                          $334,377
                                                          ========                          ========

Net interest income.................................                  $2,767                            $2,765
                                                                      ======                            ======
Net interest rate spread............................                                2.92%                             2.81%
                                                                                  ======                            ======
Net interest margin.................................                                3.49%                             3.50%
                                                                                  ======                            ======
Ratio of average interest-earning assets to
   average interest-bearing liabilities.............                              113.50%                           115.25%
                                                                                  ======                            ======
 </TABLE>

     RESULTS OF OPERATIONS (Continued)

     PROVISION FOR LOAN LOSSES. The Company's provision for loan losses was
     $30,000 and $60,000 for the three months ended March 31, 1999 and 1998,
     respectively. The Company establishes provisions for loan losses, which are
     charged to operations, in order to maintain the allowance for loan losses
     at a level which is deemed to be appropriate based upon an assessment of
     prior loss experience, industry standards, past due loans, economic
     conditions, the volume and type of loans in the Bank's portfolio, which
     includes a significant amount of multifamily and commercial real estate
     loans, substantially all of which are purchased and are collateralized by
     properties located outside of the Bank's market area, and other factors
     related to the collectibility of the Bank's loan portfolio. The net charge
     offs were $2,000 for the three months ended March 31, 1999 as compared to
     net charge offs of $1,000 for the three months ended March 31, 1998. The
     resulting allowance for loan losses was $2.7 million at March 31, 1999 as
     compared to $2.7 million at December 31, 1998 and $2.6 million at March 31,
     1998. The level of nonperforming loans decreased to $291,000 at March 31,
     1999 from $956,000 at December 31, 1998 and from $539,000 at March 31,
     1998. Management believes that the allowance for loan losses is adequate.
     While management estimates loan losses using the best available
     information, such as independent appraisals for significant collateral
     properties, no assurance can be made that future adjustments to the
     allowance will not be necessary based on changes in economic and real
     estate market conditions, further information obtained regarding known
     problem loans, identification of additional problem loans, and other
     factors, both within and outside of management's control.

     NONINTEREST INCOME. Total noninterest income increased by $44,000 to
     $920,000 for the three months ended March 31, 1999 from $876,000 for the
     three months ended March 31, 1998. The increase is due to increases in fees
     and service charges and other income, offset in part by decreases in
     abstract fees. Other fees and service charges increased

                                      -12-
<PAGE>
 
RESULTS OF OPERATIONS (Continued)

$88,000, primarily due to increases in overdraft fees, NOW and savings account
service charges and loan prepayment fees. Other income increased $28,000,
primarily due to an increase in revenues from the sale of loans, offset by
losses on disposal of certain equipment and decreases in annuity sales. Abstract
fees decreased $18,000 due to decreased sales volume. Noninterest income for the
three months ended March 31, 1998 reflects gains on sales of securities
available for sale of $55,000, while the three months ended March 31, 1999 does
not include any gains on sale of securities available for sale.

NONINTEREST EXPENSE. Total noninterest expense increased by $66,000 to $2.1
million for the three months ended March 31, 1999 from $2.0 million for the
three months ended March 31, 1998. The increase is primarily due to increases in
premisses and equipment and data processing. The increases in premises and
equipment was primarily due to an increase in depreciation expense relating
primarily to the purchase of computer equipment and software and normal cost
increases. The increase in data processing expense was due to one time costs
incurred as a result of some Year 2000 costs and normal cost increases. The
Company's efficiency ratio for the three months ended March 31, 1999 and 1998
were 55.71% and 54.60%, respectively. The Company's ratio of noninterest expense
to average assets for the three months ended March 31, 1999 and 1998 were 2.46%
and 2.38%, respectively.

INCOME TAXES. Income taxes decreased by $42,000 to $546,000 for the three months
ended March 31, 1999 as compared to $588,000 for the three months ended March
31, 1998. The decrease was primarily due to a decrease in pre-tax earnings
during the 1999 period as compared to the corresponding 1998 period.

NET INCOME. Net income totaled $1.1 million for the three months ended March 31,
1999, compared to $1.0 million for the same period in 1998.

YEAR 2000 COMPLIANCE. The Year 2000 "Y2K" issue is a serious operational problem
that is widespread and complex, affecting all industries. The problem consists
essentially of the risk that programming code in existing computer systems will
fail to properly recognize the new millennium when it occurs in the Year 2000.
Many computer programs and related hard-printed memory circuits were developed
with six-digit date fields. These programs and memory circuits were designed and
developed without considering the impact of the upcoming change in the century.
If not corrected, many computer applications could fail or create erroneous
results by or at the Year 2000. Because banks rely heavily on their computer
systems, the Federal Financial Institutions Examination council ("FFIEC") has
placed significant emphasis on the problems surrounding the year 2000 issues and
has required financial institutions to document the assessment, testing and
corrections made to ready their computer systems and programs for the year 2000
date change. The FFIEC and the OTS have strict regulations, guidelines and
milestones in place that each FDIC insured financial institution must follow in
order to remain operational. The Company's board of directors has remained
informed of the Company's position and progress in its year 2000 project.

In addition, noninformation technology systems, such as equipment like
telephones, copies and elevators may also contain embedded technology which
controls its operation and which may be effected by the Y2K problem. When the
Year 2000 arrives, systems, including some of those with embedded chips, may not
work properly because of the way they store date information. They may not be
able to deal with the date 01/01/00, and may not be able to deal with
operational 'cycles' such as 'do X every 100 days'. Thus, even noninformation
technology systems may affect the normal operations of the Company upon arrival
of the Year 2000.

In order to address the Y2K issue and to minimize its potential adverse impact,
management has begun a process to identify areas that will be affected by the
Y2K Problem, assess its potential impact on the operations of the Company,
monitor the progress of FIserv, Inc. of Milwaukee ("FIserv") and other third
party software vendors in addressing the matter, test changes provided by these
vendors, and develop contingency plans for all critical systems. An internal
committee of the Company has been formed to address the potential risks that Y2K
poses for the Company. The Company's Y2K committee has completed the awareness,
inventory and assessment phases of Y2K. The testing of the Company's internal
computer system and software should be completed by the second quarter of 1999.
The Company's most critical exposure to Y2K system problems is with its data
processing provider, FIserv. The Company

                                      -13-
<PAGE>
 
RESULTS OF OPERATIONS (Continued)

has been advised by FIserv that Fiserv's Vision system is Y2K ready as of
February, 1999. During the early second quarter of 1999, the Company intends to
complete the testing phase of Y2K. Management anticipates that the enhancements
necessary to prepare it's mission critical systems for Y2K will be completed
during the second quarter of 1999. Although the effort to prepare for Y2K is
intended to address all Y2K issues, the Company's has developed a contingency
plan to address potential Y2K issues that arise from noncompliance. Contingency
plans have been developed on a department-by-department basis in anticipation of
the possibility of unplanned system difficulties or failure of third parties to
successfully prepare reporting procedures. The testing phase on the Company's
contingency plan will begin in the second quarter of 1999.

The Company anticipates that it has and will incur internal staff costs,
consulting costs, data processing costs, additional purchase of equipment and
other expenses related to the enhancements necessary to prepare its systems for
Y2K. The Company has replaced some equipment, software and incurred consulting
fees at a cost of approximately $40,000. Management anticipates the additional
costs associated with Year 2000 compliance will not exceed $100,000. Any
personnel and consulting costs have been and will continue to be expense as
incurred. If the Company is not Y2K compliant, the costs to become compliant
would likely be material to the financial condition and operating results of the
Company.

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

In management's opinion, there has not been a material change in market risk
from December 31, 1998 as reported in Item 7A of the Form 10-K.

                                      -14-
<PAGE>
 
PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

        Not applicable

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

        Not applicable

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

        Not applicable

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

        Not applicable

ITEM 5.  OTHER INFORMATION

        None

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

        (a)  Exhibits

Exhibit 27. Financial data schedule. (Only submitted with filing in electronic
format.)

Exhibit 99.1 Press Release, dated January 28, 1999 (regarding the completion of
a stock repurchase program).

Exhibit 99.2 Press Release, dated February 26, 1999 (regarding the declaration
of a dividend).

Exhibit 99.3 Press Release, dated March 26, 1999 (regarding stock repurchase
program)

Exhibit 99.4 Press Release, dated April 16, 1999 (regarding the issuance of
limited financial information for the three months ended March 31, 1999).

 (b) Reports of Form 8-K

 None

                                      -15-
<PAGE>
 
                                  SIGNATURES

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


                                             NORTH CENTRAL BANCSHARES, INC.

DATE: May 14, 1999                           BY: /s/ David M. Bradley


 
                                                 David M. Bradley, CPA
                                                 Chairman, President and
                                                 Chief Executive Officer 

DATE: May 14, 1999                           BY: /s/ John L. Pierschbacher 


 

                                                 John L. Pierschbacher, CPA    
                                                 Principal Financial Officer 

                                      -16-