UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q

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

For the quarterly period ended September 30, 2001
or

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934For the transition period
from                      
to

Commission File Number 0-27404PFF BANCORP, INC.(exact name of registrant as specified in its charter)



|DELAWARE                                                             | 95-4561623                
|-------------------------------------------------------------------- | --------------------------
|(State or other jurisdiction of
      incorporation or organization) | (I.R.S. Employer I.D. No.)

350 South Garey Avenue, Pomona, California 91766(Address of principal executive offices)(909) 623-2323(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 XNo .

The registrant had 13,170,262 shares of common stock, par value
$.01 per share, outstanding as of November 9, 2001.

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PFF BANCORP, INC. AND SUBSIDIARY
Form 10-Q
Index

|PART I     | FINANCIAL INFORMATION (Unaudited)                                                                                        | PAGE
|---------- | ------------------------------------------------------------------------------------------------------------------------ | ----
|Item 1     | Financial statements
    Consolidated Balance Sheets as of
    September 30, 2001 and March 31, 2001                     | 1   
|           | Consolidated Statements of
    Earnings for the three and six months ended September 30, 2001 and 2000                   | 2   
|           | Consolidated
    Statements of Comprehensive Earnings
    for the three and six months ended September 30, 2001 and 2000 | 3   
|           | Consolidated Statement of Stockholders'
    Equity
    for the six months ended September 30, 2001                       | 4   
|           | Consolidated Statements of Cash Flows
    for the
    six months ended September 30, 2001 and 2000                       | 5   
|           | Notes to Unaudited Consolidated Financial
    Statements                                                                 | 7   
|Item 2     | Management's Discussion and Analysis of
    Financial Condition and Results of Operations                                | 11  
|Item 3     | Qualitative and Quantitative
    Disclosures about
    Market Risk                                                       | 21  
|PART II    | OTHER INFORMATION                                                                                                        |     
|Item 1     | Legal Proceedings                                                                                                        | 22  
|Item 2     | Changes in Securities                                                                                                    | 22  
|Item 3     | Defaults Upon Senior
    Securities                                                                                      | 22  
|Item 4     | Submission of Matters to
    a Vote of Security Holders                                                                  | 22  
|Item 5     | Other Information                                                                                                        | 22  
|Item 6     | Reports on Form 8-K                                                                                                      | 23  
|SIGNATURES |                                                                                                                          |     



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PART 1 - FINANCIAL INFORMATIONItem 1. Financial Statements.PFF BANCORP, INC. AND SUBSIDIARYCONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share data)
(Unaudited)



|                                                                                                                                                                                                       | September 30,
      2001 | March 31, 2001
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------ | --------------
|Assets                                                                                                                                                                                                 |                          |               
|Cash and cash equivalents                                                                                                                                                                              | $ 39,273                 | $ 51,526      
|Loans held for sale at lower of cost or fair value                                                                                                                                                     | 173                      | 583           
|Investment securities held-to-maturity (estimated fair value of $791 at
      September 30, 2001 and $772 at March 31, 2001)                                                                           | 702                      | 702           
|Investment securities available-for-sale, at fair value                                                                                                                                                | 93,522                   | 59,137        
|Mortgage-backed securities available-for-sale, at fair value                                                                                                                                           | 253,770                  | 302,964       
|Collateralized mortgage obligations available-for-sale, at fair value                                                                                                                                  | 68,322                   | 82,315        
|Trading securities, at fair value                                                                                                                                                                      | 2,050                    | 2,375         
|Loans receivable, net                                                                                                                                                                                  | 2,447,978                | 2,285,307     
|Federal Home Loan Bank (FHLB) stock, at cost                                                                                                                                                           | 34,143                   | 46,121        
|Accrued interest receivable                                                                                                                                                                            | 18,329                   | 18,466        
|Real estate acquired through foreclosure, net                                                                                                                                                          | 678                      | 351           
|Property and equipment, net                                                                                                                                                                            | 21,911                   | 22,946        
|Prepaid expenses and other assets                                                                                                                                                                      | 14,436                   | 13,638        
|Total assets                                                                                                                                                                                           | $ 2,995,287              | $ 2,886,431   
|                                                                                                                                                                                                       |                          |               
|Liabilities and Stockholders' Equity                                                                                                                                                                   |                          |               
|Liabilities:                                                                                                                                                                                           |                          |               
|Deposits                                                                                                                                                                                               | $ 2,038,619              | $ 2,021,261   
|FHLB advances                                                                                                                                                                                          | 646,000                  | 575,000       
|Accrued expenses and other liabilities                                                                                                                                                                 | 36,072                   | 32,172        
|Total liabilities                                                                                                                                                                                      | 2,720,691                | 2,628,433     
|Commitments and contingencies                                                                                                                                                                          | -                        | -             
|Stockholders' equity:                                                                                                                                                                                  |                          |               
|Preferred stock, $.01 par value. Authorized 2,000,000 shares; none
      issued                                                                                                                        | -                        | -             
|Common stock, $.01 par value. Authorized 59,000,000 shares; issued
      20,186,985 and 20,082,094; outstanding 13,200,018 and 13,238,627 at
      September 30, 2001 and March 31, 2001, respectively | 200                      | 200           
|Additional paid-in capital                                                                                                                                                                             | 134,262                  | 131,919       
|Retained earnings, substantially restricted                                                                                                                                                            | 149,994                  | 137,703       
|Unearned stock-based compensation                                                                                                                                                                      | (6,842)                  | (8,953)       
|Treasury stock (6,986,967 and 6,843,467 at September 30, 2001 and March
      31, 2001, respectively)                                                                                                  | (69)                     | (68)          
|Accumulated other comprehensive loss                                                                                                                                                                   | (2,949)                  | (2,803)       
|Total stockholders' equity                                                                                                                                                                             | 274,596                  | 257,998       
|Total liabilities and stockholders' equity                                                                                                                                                             | $ 2,995,287              | $ 2,886,431   
|                                                                                                                                                                                                       |                          |               
|See accompanying
      notes to the unaudited consolidated financial statements.                                                                                                                      

1

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PFF BANCORP, INC. AND SUBSIDIARYCONSOLIDATED STATEMENTS OF EARNINGS(Dollars in thousands, except per share data)
(Unaudited)

|                                                                                     | For the Three Months Ended
      September 30, | For the Six Months Ended
      September 30,
|------------------------------------------------------------------------------------ | ---------------------------------------------- | --------------------------------------------
|                                                                                     | 2001                                           | 2000                                        
|                                                                                     |                                                |                                             
|Interest income:                                                                     |                                                |                                             
|Mortgage loans                                                                       | $ 41,480                                       | $ 42,280                                    
|Non-mortgage loans                                                                   | 6,787                                          | 7,006                                       
|Mortgage-backed securities                                                           | 4,176                                          | 5,684                                       
|Collateralized mortgage obligations                                                  | 907                                            | 1,648                                       
|Investment securities and deposits                                                   | 2,596                                          | 2,770                                       
|Total interest income                                                                | 55,946                                         | 59,388                                      
|Interest expense:                                                                    |                                                |                                             
|Interest on deposits                                                                 | 19,813                                         | 23,763                                      
|Interest on borrowings                                                               | 8,256                                          | 12,540                                      
|Total interest expense                                                               | 28,069                                         | 36,303                                      
|Net interest income                                                                  | 27,877                                         | 23,085                                      
|Provision for loan losses                                                            | 1,250                                          | 1,251                                       
|Net interest income after provision for loan losses                                  | 26,627                                         | 21,834                                      
|Non-interest income:                                                                 |                                                |                                             
|Deposit and related fees                                                             | 2,377                                          | 2,266                                       
|Loan and servicing fees                                                              | 1,165                                          | 882                                         
|Trust fees                                                                           | 531                                            | 525                                         
|Gain on sales of assets, net                                                         | 71                                             | 365                                         
|Gain(loss) on trading securities, net                                                | (454)                                          | 123                                         
|Other non-interest income                                                            | 21                                             | 47                                          
|Total non-interest income                                                            | 3,711                                          | 4,208                                       
|Non-interest expense:                                                                |                                                |                                             
|General and administrative:                                                          |                                                |                                             
|Compensation and benefits                                                            | 8,232                                          | 7,497                                       
|Occupancy and equipment                                                              | 2,735                                          | 2,911                                       
|Marketing and professional services                                                  | 1,802                                          | 1,313                                       
|Other non-interest expense                                                           | 1,929                                          | 2,149                                       
|Total general and administrative                                                     | 14,698                                         | 13,870                                      
|Foreclosed real estate operations, net                                               | (3)                                            | 7                                           
|Total non-interest expense                                                           | 14,695                                         | 13,877                                      
|Earnings before income taxes                                                         | 15,643                                         | 12,165                                      
|Income taxes                                                                         | 6,575                                          | 5,088                                       
|Net earnings                                                                         | $ 9,068                                        | $ 7,077                                     
|                                                                                     |                                                |                                             
|Basic earnings per share                                                             | $ 0.77                                         | $ 0.61                                      
|Weighted average shares outstanding for basic earnings
      per share calculation   | 11,800,297                                     | 11,665,742                                  
|Diluted earnings per share                                                           | $ 0.68                                         | $ 0.55                                      
|Weighted average shares outstanding for diluted earnings per share
      calculation | 13,326,041                                     | 12,877,091                                  
|                                                                                     |                                                |                                             
|See accompanying
      notes to the unaudited consolidated financial statements.    

2

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|                                                                                                                                             | For the Three Months Ended
      September 30, | For the Six Months Ended
      September 30,
|-------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------- | --------------------------------------------
|                                                                                                                                             | 2001                                           | 2000                                        
|                                                                                                                                             |                                                |                                             
|Net earnings                                                                                                                                 | $ 9,068                                        | $ 7,077                                     
|                                                                                                                                             |                                                |                                             
|Other comprehensive earnings (losses), net of income taxes(benefit) of
      ($102) and $2,034 at September 30, 2001 and 2000, respectively: |                                                |                                             
|Unrealized gains (losses) on securities available-for-sale:                                                                                  |                                                |                                             
|U.S.Treasury and agency securities and other investment securities
      available-for-sale, at fair value                                   | (808)                                          | 899                                         
|Collateralized mortgage obligations available-for-sale, at fair value                                                                        | (314)                                          | 181                                         
|Mortgage-backed securities available-for-sale, at fair value                                                                                 | 1,498                                          | 1,336                                       
|Reclassification of realized (gains)losses included in earnings                                                                              | -                                              | -                                           
|                                                                                                                                             |                                                |                                             
|Other comprehensive earnings (losses)                                                                                                        | 376                                            | 2,416                                       
|Comprehensive earnings                                                                                                                       | $ 9,444                                        | $ 9,493                                     
|                                                                                                                                             |                                                |                                             
|See accompanying
      notes to the unaudited consolidated financial statements.                                                            

3

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PFF BANCORP, INC. AND SUBSIDIARYCONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY(Dollars in thousands, except per share data)
(Unaudited)

|                                                                                 | Number of
      Shares | Common
      Stock | Additional
      Paid-in
      Capital | Retained
      Earnings,
      Substantially
      Restricted | Unearned
      Stock-based
      Compensation | Treasury
      Stock | Accumulated
      Other
      Comprehensive
      Loss | Total    
|-------------------------------------------------------------------------------- | ---------------------- | ------------------ | -------------------------------------- | ------------------------------------------------------------- | --------------------------------------------- | -------------------- | ------------------------------------------------------ | ---------
|                                                                                 |                        |                    |                                        |                                                               |                                               |                      |                                                        |          
|Balance at March 31, 2001                                                        | 13,238,627             | $ 200              | $ 131,919                              | $ 137,703                                                     | $ (8,953)                                     | $ (68)               | $ (2,803)                                              | $ 257,998
|                                                                                 |                        |                    |                                        |                                                               |                                               |                      |                                                        |          
|Net earnings                                                                     | -                      | -                  | -                                      | 16,991                                                        | -                                             | -                    | -                                                      | 16,991   
|Purchase of treasury stock                                                       | (143,500)              | -                  | (1,434)                                | (2,091)                                                       | -                                             | (1)                  | -                                                      | (3,526)  
|Amortization of shares under stock-based compensation
      plans                | -                      | -                  | 1,078                                  | -                                                             | 2,111                                         | -                    | -                                                      | 3,189    
|Stock options exercised                                                          | 104,891                | -                  | 1,229                                  | -                                                             | -                                             | -                    | -                                                      | 1,229    
|Cash dividends ($.06 per share)                                                  | -                      | -                  | -                                      | (2,609)                                                       | -                                             | -                    | -                                                      | (2,609)  
|Changes in unrealized losses on securities available
      for sale, net         | -                      | -                  | -                                      | -                                                             | -                                             | -                    | (146)                                                  | (146)    
|Tax benefit from stock options                                                   | -                      | -                  | 1,470                                  | -                                                             | -                                             | -                    | -                                                      | 1,470    
|Balance at September 30, 2001                                                    | 13,200,018             | $ 200              | $ 134,262                              | $ 149,994                                                     | $ (6,842)                                     | $ (69)               | $ (2,949)                                              | $ 274,596
|                                                                                 |                        |                    |                                        |                                                               |                                               |                      |                                                        |          
|See accompanying
      notes to the unaudited consolidated financial statements.

4

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PFF BANCORP, INC. AND SUBSIDIARYCONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)

|                                                                                                     | Six Months Ended
      September 30,
|---------------------------------------------------------------------------------------------------- | ------------------------------------
|                                                                                                     | 2001                                
|                                                                                                     |                                     
|Cash flows from operating activities:                                                                |                                     
|Net earnings                                                                                         | $ 16,991                            
|Adjustments to reconcile net earnings to net cash provided by operating
      activities:            |                                     
|Amortization of premiums net of discount accretion on loans and
      securities                     | 432                                 
|Amortization of deferred loan origination fees                                                       | 1,924                               
|Loan fees collected                                                                                  | 25                                  
|Dividends on FHLB stock                                                                              | (1,368)                             
|Provisions for losses on loans                                                                       | 2,500                               
|Gains on sales of loans, securities available-for-sale, real estate and
      property and equipment | (327)                               
|Proceeds from sale of trading securities                                                             | -                                   
|Losses on trading securities                                                                         | 361                                 
|Depreciation and amortization of property and equipment                                              | 1,507                               
|Loans originated for sale                                                                            | (7,941)                             
|Proceeds from sale of loans held-for-sale                                                            | 8,565                               
|Amortization of unearned stock-based compensation                                                    | 3,189                               
|Increase in accrued expenses and other liabilities                                                   | 5,473                               
|(Increase) decrease in:                                                                              |                                     
|Accrued interest receivable                                                                          | 137                                 
|Prepaid expenses and other assets                                                                    | (798)                               
|Net cash provided by operating activities                                                            | 30,670                              
|                                                                                                     |                                     
|Cash flows from investing activities:                                                                |                                     
|Loans originated for investment                                                                      | (706,794)                           
|Increase in construction loans in process                                                            | 91,786                              
|Purchases of loans held for investment                                                               | (241,101)                           
|Principal payments on loans                                                                          | 688,370                             
|Principal payments on mortgage-backed securities available-for-sale                                  | 65,514                              
|Principal payments on collateralized mortgage obligations
      available-for-sale                   | 12,380                              
|Purchases of investment securities available-for-sale                                                | (83,380)                            
|Redemption of FHLB stock                                                                             | 13,346                              
|Purchases of mortgage-backed securities available-for-sale                                           | (15,094)                            
|                                                                                                     |                                     
|                                                                                                     | (Continued)                         

5

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PFF BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)

|                                                                                      | Six Months Ended
      September 30,
|------------------------------------------------------------------------------------- | ------------------------------------
|                                                                                      | 2001                                
|Proceeds from maturities of investment securities available-for-sale                  | $ 39,881                            
|Proceeds from sale of investment securities available-for-sale                        | 8,525                               
|Proceeds from sale of real estate                                                     | 669                                 
|Investment in or proceeds from real estate held for investment                        | -                                   
|Purchases of property and equipment                                                   | (477)                               
|Net cash (used in) provided by investing activities                                   | (126,375)                           
|Cash flows from financing activities:                                                 |                                     
|Proceeds from FHLB advances                                                           | 470,400                             
|Repayment of FHLB advances                                                            | (399,400)                           
|Net change in deposits                                                                | 17,358                              
|Proceeds from exercise of stock options                                               | 1,229                               
|Cash dividends                                                                        | (2,609)                             
|Purchase of treasury stock                                                            | (3,526)                             
|Net cash (used in) provided by financing activities                                   | 83,452                              
|Net increase (decrease) in cash and cash equivalents                                  | (12,253)                            
|Cash and cash equivalents, beginning of period                                        | 51,526                              
|Cash and cash equivalents, end of period                                              | $ 39,273                            
|Supplemental information:                                                             |                                     
|Interest paid, including interest credited                                            | $ 60,554                            
|Income taxes paid                                                                     | 2,650                               
|Non-cash investing and financing activities:                                          |                                     
|Net transfers from loans receivable to real estate acquired through
      foreclosure | 1,314                               
|                                                                                      |                                     
|See accompanying
      notes to the unaudited consolidated financial statements.     

6

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PFF BANCORP, INC. AND SUBSIDIARY
Notes to Unaudited Consolidated Financial Statements



(1) Basis of Consolidation

The accompanying consolidated financial statements include
the accounts of PFF Bancorp, Inc. (the "Bancorp") and its subsidiary
PFF Bank & Trust (collectively, "the Company"). The Company's
business is conducted primarily through PFF Bank & Trust and its subsidiary,
Pomona Financial Services, Inc (collectively, "the Bank"). Pomona
Financial Services, Inc. includes the accounts of Diversified Services, Inc. and
PFF Financial Services, Inc. All material intercompany balances and transactions
have been eliminated in consolidation.

The accompanying 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 Article 10 of Regulation S-X. Accordingly, they do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting principally of normal recurring
accruals) necessary for a fair presentation have been included. Certain
reclassifications have been made to the prior period consolidated financial
statements to conform to the current presentation.

The results of operations for the six months ended September 30,
2001 are not necessarily indicative of results that may be expected for the
entire fiscal year ending March 31, 2002.

(2) New Accounting Pronouncements

In September 2000, the FASB issued Statement of Financial
Accounting Standards No. 140 ("SFAS 140") to replace SFAS 125,
"Accounting for Transfers and Servicing of Financial Assets and
Extinguishment of Liabilities". SFAS 140 provides the accounting and
reporting guidance for transfers and servicing of financial assets and
extinguishment of liabilities. SFAS 140 is the authoritative accounting
literature for: (1) securitization transactions involving financial assets; (2)
sales of financial assets (including loan participations); (3) factoring
transactions; (4) wash sales; (5) servicing assets and liabilities; (6)
collateralized borrowing arrangements; (7) securities lending transactions; (8)
repurchase agreements; and (9) extinguishment of liabilities. Management has
implemented SFAS 140 and it has not had a significant impact on the Company's
financial position or results of operations.

In July 2001, the FASB issued Statement of Financial Accounting
Standards No. 141, "Business Combinations" ("SFAS 141") and
Statement of Financial Accounting Standards No. 142, "Goodwill and Other
Intangible Assets" ("SFAS 142").

SFAS 141 requires that the purchase method of accounting be used
for all business combinations initiated after June 30, 2001. The use of the
pooling-of-interests method will be prohibited. It is not anticipated that the
financial impact of this statement will have a material effect on the Company.

SFAS 142 applies to all acquired intangible assets whether
acquired singularly, as part of a group, or in a business combination. The
Statement supersedes APB Opinion No. 17, "Intangible Assets" and will
carry forward provisions in Opinion 17 related to internally developed
intangible assets. The Statement changes the accounting for goodwill from an
amortization method to an impairment-only approach. Goodwill should no longer be
amortized, but instead tested for impairment at least annually at the reporting
unit level. The accounting provisions are effective for fiscal years beginning
after December 31, 2001. For the first six months of fiscal 2002, the
amortization of excess of cost over fair value of net assets acquired was
$162,000 and as of September 30, 2001, goodwill amounted to $1.5 million. It is
not anticipated that the financial impact of this statement will have a material
effect on the Company.

7

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PFF BANCORP, INC. AND SUBSIDIARY
Notes to Unaudited Consolidated Financial Statements

In August 2001, the FASB issued Statement of Financial
Accounting Standards No. 143 ("SFAS 143"), "Accounting for Asset
Retirement Obligations." This Statement addresses financial accounting and
reporting for obligations associated with the retirement of tangible long-lived
assets and the associated asset retirement costs.

SFAS 143 requires an enterprise to record the fair value of an
asset retirement obligation as a liability in the period in which it incurs a
legal obligation associated with the retirement of a tangible long-lived asset.
Since the requirement is to recognize the obligation when incurred, approaches
that have been used in the past to accrue the asset retirement obligation over
the life of the asset are no longer acceptable. SFAS 143 also requires the
enterprise to record the contra to the initial obligation as an increase to the
carrying amount of the related long-lived asset (i.e., the associated asset
retirement costs) and to depreciate that cost over the remaining useful life of
the asset. The liability is changed at the end of each period to reflect the
passage of time (i.e., accretion expense) and changes in the estimated future
cash flows underlying the initial fair value measurement.

Enterprises are required to adopt SFAS 143 for fiscal years
beginning after June 15, 2002. It is not anticipated that the financial impact
of this statement will have a material effect on the Company.

In October 2001, the FASB issued Statement of Financial
Accounting Standards No. 144 ("SFAS 144"), "Accounting for the
Impairment or Disposal of Long-Lived Assets", which addresses financial
accounting and reporting for the impairment or disposal of long-lived assets.
While SFAS 144 supersedes SFAS 121 "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed Of", it retains
many of the fundamental provisions of that Statement.

SFAS 144 also supersedes the accounting and reporting provisions
of APB Opinion No.30, "Reporting the Results of Operations-Reporting the
Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions", for the disposal of a
segment of a business. However, it retains the requirement in Opinion 30 to
report separately discontinued operations and extends that reporting to a
component of an entity that either has been disposed of (by sale, abandonment,
or in a distribution to owners) or is classified as held for sale. By broadening
the presentation of discontinued operations to include more disposal
transactions, the FASB has enhanced management's ability to provide
information that helps financial statement users to assess the effects of a
disposal transaction on the ongoing operations of an entity.

SFAS 144 is effective for fiscal years beginning after December
15, 2001 and interim periods within those fiscal years. It is not anticipated
that the financial impact of this statement will have a material effect on the
Company.

8

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PFF BANCORP, INC. AND SUBSIDIARY
Notes to Unaudited Consolidated Financial Statements - Continued

(3) Earnings per share

Basic EPS excludes dilution and is computed by dividing
earnings available to common stockholders by the weighted average number of
common shares outstanding for the period. Diluted EPS reflects the potential
dilution that could occur if securities or other contracts to issue common stock
were exercised or converted into common stock or resulted from issuance of
common stock that then shared in earnings.

The following table is a reconciliation of the numerators and
denominators of the basic and diluted EPS computations for net earnings for PFF
Bancorp, Inc.

|                                                                      | For the Three Months Ended September 30,     
|--------------------------------------------------------------------- | ---------------------------------------------
|                                                                      | 2001(1)                                      
|                                                                      | Earnings
      (Numerator)                   
|                                                                      | (Dollars in thousands, except per share data)
|                                                                      |                                              
|Net Earnings                                                          | $ 9,068                                      
|                                                                      |                                              
|Basic EPS                                                             |                                              
|Earnings available to common stockholders                             | 9,068                                        
|                                                                      |                                              
|Effect of Dilutive Securities                                         |                                              
|Options and Stock Awards                                              | -                                            
|                                                                      |                                              
|Diluted EPS                                                           |                                              
|Earnings available to common stockholders and
    assumed conversions | $ 9,068                                      

No options to purchase shares of common stock were included
in diluted earnings per share during the three month period ending September 30,
2001 because all options' exercise prices were less than the average market
price of the common shares.

Options to purchase 10,094 shares of common stock at a
weighted average price of $20.93 per share were outstanding during the three
month period ending September 30, 2000 but were not included in the computation
of diluted EPS because the options' exercise prices were greater than the
average market price of the common shares. The options, which expire between
October 22, 2002 and November 23, 2004 were still outstanding at September 30,
2000.

9

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PFF BANCORP, INC. AND SUBSIDIARY
Notes to Unaudited Consolidated Financial Statements - Continued





|                                                                        | For the Six Months Ended September 30,       
|----------------------------------------------------------------------- | ---------------------------------------------
|                                                                        | 2001(1)                                      
|                                                                        | Earnings
      (Numerator)                   
|                                                                        | (Dollars in thousands, except per share data)
|                                                                        |                                              
|Net Earnings                                                            | $ 16,991                                     
|                                                                        |                                              
|Basic EPS                                                               |                                              
|Earnings available to common stockholders                               | 16,991                                       
|                                                                        |                                              
|Effect of Dilutive Securities                                           |                                              
|Options and Stock Awards                                                | -                                            
|                                                                        |                                              
|Diluted EPS                                                             |                                              
|Earnings available to common stockholders and assumed
      conversions | $ 16,991                                     

Options to purchase 732 shares of common stock at
a weighted average price of $24.00 per share were outstanding during the six
month period ending September 30, 2001 but were not included in the computation
of diluted EPS because the options' exercise prices were greater than the
average market price of the common shares. The options, which expire on June 27,
2006, were still outstanding at September 30, 2001.

Options to purchase 20,548 shares of common stock
at a weighted average price of $19.55 per share were outstanding during the six
month period ending September 30, 2000 but were not included in the computation
of diluted EPS because the options' exercise prices were greater than the
average market price of the common shares. The options, which expire between
October 22, 2002 and November 23, 2004, were still outstanding at September 30,
2000.

10

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PFF BANCORP, INC. AND SUBSIDIARYItem 2: Management's Discussion and Analysis of Financial
Condition and Operation

Average Balance Sheets

The following table sets forth certain
information relating to the Company for the three months ended September 30,
2001 and 2000. The yields and costs are derived by dividing income or expense by
the average balance of assets or liabilities, respectively, for the periods
shown. Average balances are derived from average daily balances. The yields and
costs include fees that are considered adjustments to yields.

|                                                                     | Three Months Ended September 30,
|-------------------------------------------------------------------- | --------------------------------
|                                                                     | 2001                            
|                                                                     | Average
      Balance           
|                                                                     | (Dollars in thousands)          
|Assets:                                                              |                                 
|Interest-earning assets:                                             |                                 
|Interest-earning deposits and short-term investments                 | $ 34,899                        
|Investment securities, net                                           | 101,859                         
|Loans receivable, net                                                | 2,372,246                       
|Mortgage-backed securities, net                                      | 263,229                         
|Collateralized mortgage obligations, net                             | 74,734                          
|FHLB stock                                                           | 35,154                          
|Total interest-earning assets                                        | 2,882,121                       
|Non-interest-earning assets                                          | 89,292                          
|Total assets                                                         | $2,971,413                      
|                                                                     |                                 
|Liabilities and Stockholders' Equity:                                |                                 
|Interest-bearing liabilities:                                        |                                 
|Savings accounts                                                     | $ 124,328                       
|Money market accounts                                                | 446,785                         
|NOW and other demand deposit accounts                                | 284,471                         
|Certificate accounts                                                 | 1,183,836                       
|Total                                                                | 2,039,420                       
|FHLB advances                                                        | 612,957                         
|Total interest-bearing liabilities                                   | 2,652,377                       
|Non-interest-bearing liabilities                                     | 45,567                          
|Total liabilities                                                    | 2,697,944                       
|Stockholders' equity                                                 | 273,469                         
|Total liabilities and stockholders' equity                           | $2,971,413                      
|Net interest income                                                  |                                 
|Net interest spread                                                  |                                 
|Effective interest spread                                            |                                 
|Ratio of interest-earning assets to interest-bearing
    liabilities | 108.66%                         

11

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PFF BANCORP, INC. AND SUBSIDIARY
Management's Discussion and Analysis of Financial Condition and Operation -
Continued

Average Balance Sheets

The following table sets forth certain
information relating to the Company for the six months ended September 30, 2001
and 2000. The yields and costs are derived by dividing income or expense by the
average balance of assets or liabilities, respectively, for the periods shown.
Average balances are derived from average daily balances. The yields and costs
include fees that are considered adjustments to yields.



|                                                                     | Six Months Ended September 30,
|-------------------------------------------------------------------- | ------------------------------
|                                                                     | 2001                          
|                                                                     | Average
      Balance         
|                                                                     | (Dollars in thousands)        
|Assets:                                                              |                               
|Interest-earning assets:                                             |                               
|Interest-earning deposits and short-term investments                 | $ 51,528                      
|Investment securities, net                                           | 88,595                        
|Loans receivable, net                                                | 2,336,910                     
|Mortgage-backed securities, net                                      | 273,006                       
|Collateralized mortgage obligations, net                             | 78,407                        
|FHLB stock                                                           | 37,451                        
|Total interest-earning assets                                        | 2,865,897                     
|Non-interest-earning assets                                          | 87,475                        
|Total assets                                                         | $2,953,372                    
|                                                                     |                               
|Liabilities and Stockholders' Equity:                                |                               
|Interest-bearing liabilities:                                        |                               
|Savings accounts                                                     | $ 124,404                     
|Money market accounts                                                | 434,937                       
|NOW and other demand deposit accounts                                | 275,642                       
|Certificate accounts                                                 | 1,199,165                     
|Total                                                                | 2,034,148                     
|FHLB advances                                                        | 606,934                       
|Total interest-bearing liabilities                                   | 2,641,082                     
|Non-interest-bearing liabilities                                     | 43,635                        
|Total liabilities                                                    | 2,684,717                     
|Stockholders' equity                                                 | 268,655                       
|Total liabilities and stockholders' equity                           | $2,953,372                    
|Net interest income before provision for loan losses                 |                               
|Net interest spread                                                  |                               
|Effective interest spread                                            |                               
|Ratio of interest-earning assets to interest-bearing
    liabilities | 108.51%                       

12

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PFF BANCORP, INC. AND SUBSIDIARY
Management's Discussion and Analysis
(Continued)

Rate/Volume Analysis

The following table presents the extent to
which changes in interest rates and changes in the volume of interest-earning
assets and interest-bearing liabilities have affected the Company's interest
income and interest expense during the periods indicated. Information is
provided in each category with respect to: (i) changes attributable to changes
in volume (changes in volume multiplied by prior rate); (ii) changes
attributable to changes in rate (changes in rate multiplied by prior volume);
(iii) changes attributable to changes in rate/volume (change in rate multiplied
by change in volume); and (iv) the net change.

|                                                     | Three Months Ended September 30, 2001
      Compared to
      Three Months Ended September 30, 2000 | Six Months Ended September 30, 2001
      Compared to
      Six Months Ended September 30, 2000
|---------------------------------------------------- | --------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------
|                                                     | Increase (Decrease)
      Due to                                                                    | Increase (Decrease)
      Due to                                                               
|                                                     | Volume                                                                                              | Rate                                                                                           
|                                                     | (Dollars in thousands)                                                                             
|                                                     |                                                                                                     |                                                                                                
|Interest-earning assets:                             |                                                                                                     |                                                                                                
|Interest-earning deposits and short-term investments | $ 112                                                                                               | (1)                                                                                            
|Investment securities, net                           | 112                                                                                                 | (236)                                                                                          
|Loans receivable, net                                | 1,215                                                                                               | (2,180)                                                                                        
|Mortgage-backed securities, net                      | (1,368)                                                                                             | (186)                                                                                          
|Collateralized mortgage obligations, net             | (232)                                                                                               | (592)                                                                                          
|FHLB stock                                           | (175)                                                                                               | 28                                                                                             
|Total interest-earning assets                        | (336)                                                                                               | (3,167)                                                                                        
|                                                     |                                                                                                     |                                                                                                
|Interest-bearing liabilities:                        |                                                                                                     |                                                                                                
|Savings accounts                                     | (42)                                                                                                | (257)                                                                                          
|Money market accounts                                | 832                                                                                                 | (1,682)                                                                                        
|NOW and other demand deposit accounts                | 100                                                                                                 | (73)                                                                                           
|Certificate accounts                                 | 184                                                                                                 | (2,737)                                                                                        
|FHLB advances                                        | (2,848)                                                                                             | (1,890)                                                                                        
|Total interest-bearing liabilities                   | (1,774)                                                                                             | (6,639)                                                                                        
|Change in net interest income                        | $ 1,438                                                                                             | 3,472                                                                                          

13

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PFF BANCORP, INC. AND SUBSIDIARY
Management's Discussion and Analysis
(Continued)

Forward-Looking Statements

Except for historical information contained herein, the
matters discussed in this report contain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended (the
"Securities Act"), and Section 21E of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), that involve substantial risks
and uncertainties. When used in this report, or in the documents incorporated by
reference herein, the words "anticipate," "believe,"
"estimate,"  "may," "intend," "expect"
and similar expressions identify certain of such forward-looking statements.
Actual results could differ materially from such forward-looking statements
contained herein. Factors that could cause future results to vary from current
expectations include, but are not limited to, the following: changes in economic
conditions (both generally and more specifically in the markets in which the
Company operates); changes in interest rates, deposit flows, loan demand, real
estate values and competition; changes in accounting principles, policies or
guidelines and in government legislation and regulation (which change from time
to time and over which the Company has no control); other factors affecting the
Company's operations, markets, products and services, and other risks detailed
in this Form 10-Q and in the Company's other Securities and Exchange
Commission filings. Readers are cautioned not to place undue reliance on these
forward-looking statements, which reflect management's analysis only as of the
date hereof. The Company undertakes no obligation to publicly revise these
forward-looking statements to reflect events or circumstances that arise after
the date hereof.

Comparison of Operating Results for the Three Months Ended
September 30, 2001 and 2000

General

The Company recorded net earnings of $9.1 million or $0.68
per diluted share for the three months ended September 30, 2001, compared to net
earnings of $7.1 million or $0.55 per diluted share for the comparable period of
2000.

Net interest income was $27.9 million for the three months
ended September 30, 2001, compared to $23.1 million for the comparable period of
2000. The increase in net interest income was attributable to a 75 basis point
expansion of the Company's net interest spread from 2.81% for the three months
ended September 30, 2000, to 3.56% for the comparable period of 2001.

Provision for loan losses was $1.3 million for the three
months ended September 30, 2001 and 2000.

Total non-interest income was $3.7 million for the three
months ended September 30, 2001, compared to $4.2 million for the comparable
period of 2000. Total non-interest expense was $14.7 million for the three
months ended September 30, 2001, compared to $13.9 million for the comparable
period of 2000

Interest Income

Interest income was $55.9 million for the three months ended
September 30, 2001, compared to $59.4 million for the comparable period of 2000.
The $3.4 million decrease in interest income was attributable to a 38 basis
point decrease in average yield on interest-earning assets, coupled with a $34.9
million decrease in average interest-earning assets. Average yield on
interest-earnings assets was 7.76% for the three months ended September 30, 2001
compared to 8.14% for the comparable period of 2000.

14

---

PFF BANCORP, INC. AND SUBSIDIARY
Management's Discussion and Analysis
(Continued)

The average yield on loans receivable, net decreased 38 basis
points from 8.52% for the three months ended September 30, 2000, to 8.14% for
the comparable period of 2001. The decrease in the average yield on loans
receivable, net was attributable to the reduction in the general level of
interest rates. Approximately $1.59 billion of the Bank's loans receivable are
adjustable rate. This does not include approximately $597.0 million of hybrid
adjustable rate mortgages (ARMs) that are still in their initial fixed rate
periods generally ranging from three to five years. Of the $1.59 billion of
adjustable rate loans, $472.6 million are indexed to Prime, $358.1 million are
indexed to the one-year Constant Maturity Treasury ("CMT") and $504.7
million are indexed to the Eleventh District Cost of Funds Index ("COFI").
Based on end of month levels, Prime, one-year CMT and COFI decreased 3.50%,
3.31% and 1.57%, respectively between September 30, 2000 and 2001. The downward
movement in average yield on loans receivable, net was partially mitigated by an
increase in the aggregate disbursed balance of construction, commercial
business, commercial real estate and consumer loans (the Four-Cs) from $843.4
million or 36 percent of loans receivable, net at September 30, 2000, to $985.8
million or 40 percent of loans receivable, net at September 30, 2001.
Originations of the Four-Cs continues to be an area of focus for the Bank with
such loans accounting for 87% and 92% of total loan originations for the three
months ended September 30, 2001 and 2000, respectively.

The average yield on the aggregate balance of investment
securities, mortgage-backed securities and collateralized mortgage obligations
(collectively, "securities") was 6.01% for the three months ended
September 30, 2001 compared to 6.80% for the comparable period of 2000. The
decrease in the average yield on securities reflects the impact of the decrease
in the general level of interest rates.

Average interest-earning assets were $2.88 billion for the
three months ended September 30, 2001, compared to $2.92 billion for the
comparable period of 2000. The decrease in average interest-earning assets was
due to a $89.3 million decrease in the average balance of securities from $529.1
million for the three months ended September 30, 2000, to $439.8 million for the
comparable period of 2001. The decrease reflects the Company's strategy of
redeploying earning assets from securities into loans receivable. The average
balance of loans receivable net increased $57.1 million from $2.32 billion for
the three months ended September 30, 2000, to $2.37 billion for the comparable
period of 2001.

Interest Expense

Interest expense was $28.1 million for the three months ended
September 30, 2001, compared to $36.3 million for the comparable period of 2000.
The $8.2 million decrease in interest expense was attributable to a 113 basis
point decrease in the average cost of interest-bearing liabilities from 5.33%
for the three months ended September 30, 2000, to 4.20% for the comparable
period of 2001, coupled with a $57.3 million decrease in average
interest-bearing liabilities from $2.71 billion for the three months ended
September 30, 2000, to $2.65 billion for the comparable period of 2001. The 113
basis point decrease in the average cost of interest-bearing liabilities
reflects a 108 basis point decrease in the average cost of deposits and a 95
basis point decrease in the cost of FHLB advances.

Average total deposits increased $122.3 million from $1.92
billion for the three months ended September 30, 2000, to $2.04 billion for the
comparable period of 2001. The average balance of core deposits increased $110.3
million from $745.3 million for the three months ended September 30, 2000, to
$855.6 million for the comparable period of 2001. The average balance of core
deposits as a percentage of average total deposits and average interest-bearing
liabilities increased from 39% and 28%, respectively for the three months ended
September 30, 2000, to 42% and 32%, respectively for the comparable period of
2001. The decrease in the average cost of deposits from 4.93% for the three
months ended September 30, 2000, to 3.85% for the comparable period of 2001
reflects the decrease in the general level of interest rates coupled with the
continued growth in core deposits. The average costs of core deposits and C.D.s
were 2.06% and 5.15%, respectively for the three months ended September 30,
2001, compared to 3.12% and 6.08%, respectively for the comparable period of
2000.

15

---

PFF BANCORP, INC. AND SUBSIDIARY
Management's Discussion and Analysis
(Continued)

Provision for Loan Losses

Provision for loan losses was $1.3 million for the three
months ended September 30, 2000 and 2001. See "Comparison of Financial
Condition at September 30, 2001 and March 31, 2001".

Non-Interest Income

Non-interest income was $3.7 million for the three months
ended September 30, 2001, compared to $4.2 million for the comparable period of
2000. Non-interest income excluding trading securities activity, ("core
non-interest income") was $4.2 million for the three months ended September
30, 2001, compared to $4.1 million for the comparable period of 2000. The
increase in loan and servicing fees from $882,000 for the three months ended
September 30, 2000, to $1.2 million for the comparable period of 2001, was
attributable to an increase in fees received in connection with higher levels of
loan prepayments. The decrease in gain on sale of assets, net from $365,000 for
the three months ended September 30, 2000, to $71,000 for the comparable period
of 2001, was attributable to a reduction in sales of loans. The principal
balance of loans sold was $1.4 million during the three months ended September
30, 2001, compared to $4.7 million during the comparable period of 2000. This
decrease in loan sales reflects the Company's efforts to grow its loan
portfolio.

Non-Interest Expense

Non-interest expense as well as general and administrative
expense was $14.7 million or 1.98 percent of average assets for the three months
ended September 30, 2001, compared to $13.9 million or 1.86 percent of average
assets for the comparable period of 2000. Compensation and benefits expense was
$8.2 million for the three months ended September 30, 2001, compared to $7.5
million for the comparable period in 2000. Included in compensation and benefits
expense are non-cash charges associated with the amortization of shares under
the Company's Employee Stock Ownership Plan (ESOP) and 1996 Incentive Plan of
$1.6 million for the three months ended September 30, 2001, compared to $1.5
million for the comparable period of 2000. The increase in marketing and
professional services from $1.3 million for the three months ended September 30,
2000, to $1.8 million for the comparable period of 2001 reflects an increase in
the Bank's marketing expenditures directed toward the Hispanic market. The
Hispanic market is one of the fastest growing segments in many of the
communities served by the Bank.

Income Taxes

Income taxes were $6.6 million for the three months ended
September 30, 2001, compared to $5.1 million for the comparable period of 2000.
The effective tax rate was 42.0% for the three months ended September 30, 2001,
compared to 41.8% for the comparable period of 2000.

Comparison of Operating Results for the Six Months Ended
September 30, 2001 and 2000

General

The Company recorded net earnings of $17.0 million or $1.29
per diluted share for the six months ended September 30, 2001, compared to net
earnings of $14.4 million or $1.14 per diluted share for the comparable period
of 2000.

Net interest income was $53.0 million for the six months
ended September 30, 2001, compared to $47.1 million for the comparable period of
2000. The increase in net interest income was attributable to a 51 basis point
expansion of the Company's net interest spread from 2.85% for the six months
ended September 30, 2000, to 3.36% for the comparable period of 2001.

16

---

PFF BANCORP, INC. AND SUBSIDIARY
Management's Discussion and Analysis
(Continued)

Provision for loan losses was $2.5 million for the six months
ended September 30, 2001 and 2000.

Total non-interest income was $8.0 million for the six months
ended September 30, 2001, compared to $7.9 million for the comparable period of
2000. Total non-interest expense was $29.2 million for the six months ended
September 30, 2001, compared to $27.4 million for the comparable period of 2000.

Interest Income

Interest income was $112.9 million for the six months ended
September 30, 2001, compared to $119.0 million for the comparable period of
2000. The $6.1 million decrease in interest income was attributable to a 22
basis point decrease in average yield on interest-earning assets, coupled with a
$71.0 million decrease in average interest-earning assets. Average yield on
interest-earning assets was 7.88% for the six months ended September 30, 2001,
compared to 8.10% for the comparable period of 2000.

The average yield on loans receivable, net decreased 15 basis
points from 8.43% for the six months ended September 30, 2000 to 8.28% for the
comparable period of 2001. The decrease in the average yield on loans
receivable, net was attributable to the reduction in the general level of
interest rates. Originations of the Four-Cs accounted for 87% and 92% of total
loan originations for the six months ended September 30, 2001 and 2000,
respectively.

The average yield on securities was 6.18% for the six months
ended September 30, 2001, compared to 6.77% for the comparable period of 2000.
The decrease in the average yield on securities also reflects the impact of the
decrease in the general level of interest rates.

Average interest-earning assets were $2.87 billion for the
six months ended September 30, 2001, compared to $2.94 billion for the
comparable period of 2000. The decrease in average interest-earning assets was
due to a $103.0 million decrease in the average balance of securities from
$543.0 million for the six months ended September 30, 2000, to $440.0 million
for the comparable period of 2001. The average balance of loans receivable, net
increased $12.6 million from $2.32 billion for the six months ended September
30, 2000, to $2.34 billion for the comparable period of 2001. During April 2000,
the Bank received a $329,000 special dividend from the FHLB of San Francisco.
This special dividend increased the average yield on interest-earning assets for
the six months ended September 30, 2000 by 3 basis points.

Interest Expense

Interest expense was $59.9 million for the six months ended
September 30, 2001, compared to $71.9 million for the comparable period of 2000.
The $12.0 million decrease in interest expense was attributable to a 73 basis
point decrease in the average cost of interest-bearing liabilities from 5.25%
for the six months ended September 30, 2000, to 4.52% for the comparable period
of 2001, coupled with a $96.4 million decrease in average interest-bearing
liabilities from $2.74 billion for the six months ended September 30, 2000, to
$2.64 billion for the comparable period of 2001. The 73 basis point decrease in
the average cost of interest-bearing liabilities reflects a 61 basis point
decrease in the average cost of deposits, a 68 basis point decrease in the
average cost of FHLB advances, and an increase in the proportion of total
interest-bearing liabilities comprised by deposits.

17

---

PFF BANCORP, INC. AND SUBSIDIARY
Management's Discussion and Analysis
(Continued)

Average total deposits increased $126.2 million from $1.91
billion for the six months ended September 30, 2000, to $2.03 billion for the
comparable period of 2001. The average balance of core deposits increased $94.7
million from $740.2 million for the six months ended September 30, 2000, to
$835.0 million for the comparable period of 2001. The average balance of core
deposits as a percentage of average total deposits and average interest-bearing
liabilities increased from 39% and 27%, respectively for the six months ended
September 30, 2000 to 41% and 32%, respectively for the comparable period of
2001. The decrease in the average cost of deposits from 4.83% for the six months
ended September 30, 2000, to 4.22% for the comparable period of 2001 reflects
the decrease in the general level of interest rates coupled with the growth in
core deposits. The average costs of core deposits and C.D.s were 2.32% and
5.54%, respectively for the six months ended September 30, 2001, compared to
3.10% and 5.92%, respectively for the comparable period of 2000.

Provision for Loan Losses

Provision for loan losses was $2.5 million for both the six
months ended September 30, 2001 and 2000. See "Comparison of Financial
Condition at September 30, 2001 and March 31, 2001."

Non-Interest Income

Non-interest income was $8.0 million for the six months ended
September 30, 2001, compared to $7.9 million for the comparable period of 2000.
The increase in loan and servicing fees from $1.9 million for the six months
ended September 30, 2000, to $2.2 million for the comparable period of 2001, is
attributable to an increase in prepayment fees received. The decrease in other
non-interest income from $247,000 for the six months ended September 30, 2000,
to $63,000 for the comparable period of 2001 was primarily attributable to gains
on sales of real estate totaling $194,000 recorded in the six months ended
September 30, 2000.

Non-Interest Expense

Non-interest expense as well as general and administrative
expense was $29.2 million or 1.95% of assets for the six months ended September
30, 2001, compared to $27.4 million or 1.82% of assets for the comparable period
of 2000. Compensation and benefits expense was $16.1 million for the six months
ended September 30, 2001, compared to $14.8 million for the comparable period in
2000. The increase in compensation and benefits reflects a slight increase in
staffing levels coupled with an increase in non-cash charges associated with the
amortization of shares under the Company's ESOP and 1996 Incentive Plan from
$2.7 million for the six months ended September 30, 2000, to $3.2 million for
the comparable period of 2001. The increase in marketing and professional
services expense from $2.4 million for the six months ended September 30, 2000,
to $3.4 million for the comparable period of 2001, reflects the Bank's
Hispanic marketing programs.

Income Taxes

Income taxes were $12.3 million for the six months ended
September 30, 2001, compared to $10.7 million for the comparable period of 2000.
The effective tax rate was 42.1% for the six months ended September 30, 2001,
compared to 42.6% for the comparable period of 2000.

Comparison of Financial Condition at September 30, 2001
and March 31, 2001

Total assets increased $108.9 million from $2.89 billion at
March 31, 2001 to $3.00 billion at September 30, 2001. Loans receivable, net
increased $162.7 million from $2.29 billion at March 31, 2001, to $2.45 billion
at September 30, 2001. The $162.7 million increase in loans receivable, net
included a $97.7 million increase in the aggregate disbursed balance of the Four
Cs and a $72.9 million increase in 1-4 family residential mortgages. Securities
decreased $28.8 million from $445.1 million at March 31, 2001, to $416.3 million
at September 30, 2001, reflecting the utilization of paydowns on securities to
fund loan growth.

18

---

PFF BANCORP, INC. AND SUBSIDIARY
Management's Discussion and Analysis
(Continued)

Loan originations for the six months ended September 30, 2001
were $714.7 million, compared to $544.8 million for the comparable period of
2000. Loan principal payoffs and paydowns increased to $688.4 million for the
six months ended September 30, 2001, from $516.8 million for the comparable
period of 2000. Non-accrual loans decreased from $11.5 million or 0.45% of gross
loans at March 31, 2001, to $9.4 million or 0.33% of gross loans at September
30, 2001. Non-performing assets, which includes non-accrual loans, and
foreclosed real estate, net of specific allowances, decreased from $11.8 million
or 0.41% of total assets at March 31, 2001, to $10.1 million or 0.34% of total
assets at September 30, 2001.

The allowance for loan losses is maintained at an amount
management considers adequate to cover losses on loans receivable, which are
deemed probable and estimable. The allowance is based upon a number of factors,
including current economic conditions, actual loss experience, industry trends
and the composition of the loan portfolio by type. In addition, various
regulatory agencies, as an integral part of their examination process,
periodically review the Company's allowance for loan losses. Such agencies may
require the Company to make additional provisions for loan losses based upon
information available at the time of the review. At September 30, 2001, the
Company's allowance for loan losses was $32.2 million or 1.15% of gross loans
and 343.5% of non-accrual loans compared to $31.0 million or 1.22% of gross
loans and 270.20% of non-accrual loans at March 31, 2001. The Bank will continue
to monitor and modify its allowance for loan losses as economic conditions, loss
experience, and changes in portfolio composition and other factors dictate. The
following table sets forth activity in the Bank's allowance for loan losses
for the three and six months ended September 30, 2001.

|                          | Six Months Ended September 30,
|------------------------- | ------------------------------
|                          | 2001                          
|Beginning balance         | $ 31,022                      
|Provision for loan losses | 2,500                         
|Charge-offs               | (1,339)                       
|Recoveries                | 51                            
|Ending balance            | $ 32,234                      

Total liabilities increased $92.3 million from $2.63 billion at March 31, 2001
to $2.72 billion at September 30, 2001. Deposits increased $17.4 million from
$2.02 billion at March 31, 2001 to $2.04 billion at September 30, 2001. Core
deposits increased $44.3 million from $803.9 million at March 31, 2001 to $848.2
million at September 30, 2001. FHLB advances increased $71.0 million from $575.0
million at March 31, 2001 to $646.0 million at September 30, 2001.

Total stockholders' equity was $274.6 million at September
30, 2001, compared to $258.0 million at March 31, 2001. The $16.6 million
increase in total stockholders' equity is comprised principally of a $12.3
million increase in retained earnings, substantially restricted, a $2.3 million
increase in additional paid-in-capital and a $2.1 million decrease in unearned
stock-based compensation. The $12.3 million increase in retained earnings,
substantially restricted reflects the $17.0 million of net earnings for the six
months ended September 30, 2001 partially offset by 1) $2.6 million representing
the quarterly cash dividends of $0.06 per common share declared on June 15 and
September 14, 2001, paid June 29 and September 29, 2001 and a quarterly cash
dividend of $0.08 per common share declared September 19, payable December 28,
2001 and 2) $2.1 million representing the amount paid by the Company in excess
of the original issuance price to repurchase 143,500 shares of its common stock
at a weighted average price of $24.57 per share. The $2.3 million increase in
additional paid-in-capital is comprised of $3.8 million representing the
amortization and issuance of shares under the Company's stock-based
compensation plans along with the income tax benefit arising therefrom,
partially offset by the removal from paid-in-capital of the $1.4 million created
upon the March 1996 issuance of the 143,500 shares of common stock that were
repurchased during the six months ended September 30, 2001. The $2.1 million
decrease in unearned stock-based compensation reflects the amortization of
shares under the Company's ESOP ($843,000) and 1996 Incentive Plan ($1.3
million).

19

---

PFF BANCORP, INC. AND SUBSIDIARY
Management's Discussion and Analysis
(Continued)

Liquidity and Capital Resources

The Company's primary sources of funds are deposits,
principal and interest payments on loans and securities, FHLB advances and other
borrowings, proceeds from the maturation of securities and, to a lesser extent,
proceeds from the sale of loans and securities. While maturities and scheduled
amortization of loans and securities are predictable sources of funds, deposit
flows and mortgage and security prepayments are greatly influenced by the
general level of interest rates, economic conditions and competition. Effective
March 14, 2001, the OTS adopted an interim rule eliminating the statutory
liquidity requirement. In its place, the OTS adopted a policy, consistent with
that of the other Federal banking regulatory agencies, that liquidity be
maintained at a level which provides for safe and sound banking practices and
financial flexibility. The Bank invests in corporate securities when the yields
thereon are more attractive than U.S. government and federal agency securities
of similar maturity. While corporate securities are not backed by any government
agency, the maturity structure and credit quality of all corporate securities
owned by the Bank meet the minimum standards set forth by the OTS for regulatory
liquidity-qualifying investments. The Bank invests in callable debt issued by
Federal agencies of the U.S. government when the yields thereon to call date(s)
and maturity exceed the yields on comparable term and credit quality
non-callable investments by amounts which management deems sufficient to
compensate the Bank for the call options inherent in the securities.

The Company's cash flows are comprised of three primary
classifications: cash flows from operating activities, investing activities and
financing activities. Cash flows provided by operating activities were $30.7
million and $34.9 million for the six months ended September 30, 2001 and 2000,
respectively. Net cash provided by (used in) investing activities consisted
primarily of disbursements for loan originations and purchases of
mortgage-backed and other investment securities, offset by principal collections
on loans and proceeds from maturation of investments and paydowns on
mortgage-backed securities. Principal payments on loans were $688.4 million and
$516.8 million for the six months ended September 30, 2001 and 2000,
respectively. Disbursements on loans originated and purchased were $955.8
million and $545.0 million for the six months ended September 30, 2001 and 2000,
respectively. Disbursements for purchases of mortgage-backed and other
investment securities were $98.5 million and zero for the six months ended
September 30, 2001 and 2000, respectively. Proceeds from the maturation and
paydown of securities were $117.8 million and $52.4 million for the six months
ended September 30, 2001 and 2000, respectively. Net cash provided by (used in)
financing activities consisted primarily of net activity in deposit accounts and
FHLB advances. The net increases in deposits were $17.4 million and $27.7
million for the six months ended September 30, 2001 and 2000, respectively.

At September 30, 2001, the Bank exceeded all of its
regulatory capital requirements with a tangible capital level of $255.3 million,
or 8.56% of adjusted total assets, which is above the required level of $44.7
million, or 1.5%; core capital of $255.3 million, or 8.56 % of adjusted total
assets, which is above the required level of $119.2 million, or 4.0%, and total
risk-based capital of $281.9 million, or 12.77% of risk-weighted assets, which
is above the required level of $176.6 million, or 8.0%.

The Company's most liquid assets are cash and short-term
investments. The levels of these assets are dependent on the Company's
operating, financing, lending and investing activities during any given period.
At September 30, 2001, cash and short-term investments totaled $39.3 million.
The Company has other sources of liquidity if a need for additional funds
arises, including the utilization of reverse repurchase agreements and FHLB
advances. At September 30, 2001, the Bank had $646.0 million of FHLB advances
outstanding. Other sources of liquidity include investment securities maturing
within one year.

20

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PFF BANCORP, INC. AND SUBSIDIARY
Management's Discussion and Analysis
(Continued)

The Company currently has no material contractual obligations
or commitments for capital expenditures. At September 30, 2001, the Bank had
outstanding commitments to originate and purchase loans of $420.7 million and
zero, respectively. At September 30, 2001, and 2000 the Company had no
outstanding commitments to purchase securities. The Company anticipates that it
will have sufficient funds available to meet these commitments. Certificate
accounts that are scheduled to mature in less than one year from September 30,
2001 totaled $1.08 billion. The Bank expects that a substantial portion of the
maturing certificate accounts will be retained by the Bank at maturity.

Segment Reporting

The Company, through the branch network of the Bank, provides
a broad range of financial services to individuals and companies located
primarily in Southern California. These services include demand, time, and
savings deposits; real estate, business and consumer lending; ATM processing;
cash management; and trust services. While the Company's chief decision makers
monitor the revenue streams of the various Company products and services,
operations are managed and financial performance is evaluated on a Company-wide
basis. Accordingly, all of the Company's banking operations are considered by
management to be aggregated in one reportable operating segment.

Item 3. Qualitative and
Quantitative Disclosures about Market Risk

Readers should refer to the qualitative disclosures
(consisting primarily of interest rate risk) in the Company's March 31, 2001
Form 10-K, as there has been no significant changes in these disclosures during
the six months ended September 30, 2001.

21

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PART II - OTHER INFORMATION

PFF BANCORP, INC. AND SUBSIDIARY

Item 1. Legal Proceedings

The Company and subsidiary have been named as defendants in
various lawsuits arising in the normal course of business. The outcome of the
lawsuits cannot be predicted, but the Company intends to vigorously defend the
actions and is of the opinion that the lawsuits will not have a material adverse
effect on the Company.

Item 2. Changes in
Securities

None

Item 3. Defaults Upon
Senior Securities

None

Item 4. Submission
of Matter to a Vote of Security Holders

| | Election of Directors of the Company for three year
      terms:     | Number of Votes For | Number of Votes Withheld |                           
| | -------------------------------------------------------------------- | ------------------- | ------------------------ | --------------------------
| |                                                                      |                     |                          |                           
| | Donald R DesCombes                                                   | 10,618,659          | 543,917                  |                           
| |                                                                      |                     |                          |                           
| | Robert D. Nichols                                                    | 10,628,480          | 534,096                  |                           
| |                                                                      |                     |                          |                           
| | Larry M. Rinehart                                                    | 10,582,941          | 579,635                  |                           
| |                                                                      |                     |                          |                           
| |                                                                      |                     |                          |                           
| |                                                                      | Number of Votes For | Number of Votes Against  | Number of Votes Abstaining
| | Ratification of KPMG LLP as the Company's independent
      auditors | 10,969,085          | 124,610                  | 68,881                    

Item 5. Other Information

None

22

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Item 6. Reports on Form 8-K.

Exhibit 3(I) - Certificate of Incorporation of PFF Bancorp,
Inc. *

Exhibit 3(ii) - Bylaws of PFF Bancorp, Inc. *

Reports on form 8-K

None

_________________________
*Incorporated herein by reference to Form S-1, Registration Statement, as
amended, filed on December 8, 1995, SEC Registration Number 33-94860.

23

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PFF BANCORP, INC. AND SUBSIDIARY
SIGNATURES

Pursuant to the
requirements of Section 13 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: November 9, 2001 | BY:/s/ LARRY M. RINEHART       
|                        |                                
|                        |                                
|                        |                                
|                        |                                
|DATED: November 9, 2001 | BY:/s/ GREGORY C.
      TALBOTT
|                        |                                
|                        |                                
|                        |