SECURITIES AND EXCHANGE COMMISSION
                                Washington, D.C.

                                   FORM 10-QSB

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

                For the quarterly period ended December 31, 1998

                                       OR

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

             For the transition period from __________ to __________

                           Commission File No. 0-27714

                     Crazy Woman Creek Bancorp Incorporated
                     --------------------------------------
             (Exact name of registrant as specified in its charter)

          Wyoming                                                83-0315410   
--------------------------------------------------------------------------------
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)


                     106 Fort Street, Buffalo, Wyoming 82834
                     ---------------------------------------
                    (Address of principal executive offices)


                                 (307) 684-5591
                                 --------------
              (Registrant's telephone number, including area code)



Check whether the issuer (1) filed all reports  required to be filed by Sections
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. Yes  X     No
                                                              ---       ---

State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date.

         Class:   Common Stock, par value $.10 per share
                  Outstanding at January 31, 1999:  909,261

Transitional Small Business Disclosure Format (check one):  Yes        No  X    
                                                                 ---      ---

<PAGE>


                     CRAZY WOMAN CREEK BANCORP INCORPORATED

                              INDEX TO FORM 10-QSB
<TABLE>
<CAPTION>
                                                                                                              Page
                                                                                                              ----
<S>            <C>                                                                                           <C> 
PART I          FINANCIAL INFORMATION
                ---------------------

Item 1.         Financial Statements
                Consolidated Condensed Statements of Financial Condition at December 31, 1998
                (unaudited) and September 30, 1998 (audited)                                                    1
                Consolidated Condensed Statements of Income for the three months ended December
                31, 1998 and 1997 (unaudited)                                                                   2
                Consolidated Condensed Statements of Stockholders' Equity and Comprehensive
                Income for the three months ended December 31, 1998 and 1997 (unaudited)                        3
                Consolidated Condensed Statements of Cash Flows for the three months ended
                December 31, 1998 and 1997 (unaudited)                                                          4
                Notes to Consolidated Condensed Financial Statements
                                                                                                                5

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

PART II.        OTHER INFORMATION                                                                  
                -----------------

Item 1.         Legal Proceedings....................................................                          14
Item 2.         Changes in Securities................................................                          14
Item 3.         Defaults upon Senior Securities......................................                          14
Item 4.         Submission of Matters to a Vote of Security Holders..................                          14
Item 5.         Other Information....................................................                          14
Item 6.         Exhibits and Reports on Form 8-K.....................................                          15

SIGNATURES

</TABLE>


<PAGE>
                                 
              CRAZY WOMAN CREEK BANCORP INCORPORATED AND SUBSIDIARY
            Consolidated Condensed Statements of Financial Condition
<TABLE>
<CAPTION>
                                                                                        December 31,            September 30,
                                                                                           1998                    1998
                                                                                     -----------------      ------------------
                                                                                        (unaudited)              (audited)
                                                                                               (In thousands)
<S>                                                                                       <C>                     <C>    
Assets
------
Cash and cash equivalents.......................................................            $ 1,114                 $ 1,562
Interest-bearing time deposits..................................................                 99                      99
Investment and mortgage-backed securities available-for-sale....................             29,161                  24,635
Investment and mortgage-backed securities held-to-maturity
  (estimated market value of $4,021 at September 30, 1998)......................                 --                   3,938
Stock in Federal Home Loan Bank of Seattle, at cost.............................                935                     917
Loans receivable, net...........................................................             30,416                  29,986
Accrued interest receivable.....................................................                500                     538
Real estate held in judgment....................................................                 67                      --
Premises and equipment, net.....................................................                390                     398
Income tax receivable...........................................................                 --                      39
Other assets....................................................................                 19                      42
                                                                                  -----------------      ------------------
    Total assets................................................................            $62,701                 $62,154
                                                                                  ==================     ===================
Liabilities and Stockholders' Equity
------------------------------------
Liabilities
  Deposits......................................................................            $32,760                 $32,913
  Advances from Federal Home Loan Bank..........................................             15,100                  14,650
  Advances from borrowers for taxes and insurance...............................                 17                      64
  Federal income tax payable ...................................................                 42                      --
  Deferred income taxes.........................................................                244                     211
  Dividends payable.............................................................                 91                      91
  Accrued expenses and other liabilities........................................                222                     189
                                                                                  ------------------     -------------------
    Total liabilities...........................................................             48,476                  48,118
Stockholders' equity
  Preferred stock, par value $.10 per share, 2,000,000 shares                   
    authorized; none issued and outstanding.....................................                 --                      --
  Common stock, par value $.10 per share, 5,000,000 shares                      
    authorized; 1,058,000 issued................................................                106                     106
  Additional paid-in surplus....................................................             10,087                  10,083
  Unearned ESOP/MSBP shares.....................................................              (647)                   (671)
  Retained earnings, substantially restricted...................................              6,834                   6,737
  Treasury stock, at cost 148,739 shares                                                    (2,427)                 (2,427)
  Accumulated other comprehensive income........................................                272                     208
                                                                                  ------------------     -------------------
    Total stockholders' equity..................................................             14,225                  14,036
                                                                                  ------------------     -------------------
    Total liabilities and stockholders' equity..................................            $62,701                 $62,154
                                                                                  ==================     ===================
</TABLE>

See notes to consolidated condensed financial statements.

                                     Page 1
<PAGE>


              CRAZY WOMAN CREEK BANCORP INCORPORATED AND SUBSIDIARY
                   Consolidated Condensed Statements of Income
<TABLE>
<CAPTION>
                                                                                                Three Months Ended
                                                                                                    December 31,
                                                                                     -------------------------------------------
                                                                                           1998                    1997
                                                                                     ------------------      ------------------
                                                                                                    (Unaudited)
                                                                                        (Dollars in thousands except earnings 
                                                                                                  per share data)
<S>                                                                                            <C>                     <C> 
Interest Income:
  Loans receivable                                                                                $613                    $599
  Mortgage-backed securities                                                                       106                     179
  Investment securities                                                                            316                     326
  Interest bearing time deposits                                                                     1                       1
  Other                                                                                             53                      25
                                                                                     ------------------      ------------------
     Total interest income                                                                       1,089                   1,130
Interest expense:
  Deposits                                                                                         403                     382
  Advances from Federal Home Loan Bank                                                             202                     230
                                                                                     ------------------      ------------------
     Total interest expense                                                                        605                     612
                                                                                     ------------------      ------------------
     Net interest income                                                                           484                     518
Provision for loan losses                                                                            6                      --
                                                                                     ------------------      ------------------
     Net interest income after provision for loan losses                                           478                     518
                                                                                     ------------------      ------------------
Non-interest income:
  Customer service charges                                                                          10                      12
  Other operating income                                                                            16                      10
                                                                                     ------------------      ------------------
     Total non-interest income                                                                      26                      22
                                                                                     ------------------      ------------------
Non-interest expense:
  Compensation and benefits                                                                        128                     138
  Occupancy and equipment                                                                           21                      21
  FDIC/SAIF deposit insurance premiums                                                               4                       5
  Advertising                                                                                        9                       9
  Data processing services                                                                          27                      24
  Loss on sale of premises and equipment                                                            --                       3
  Other                                                                                             53                      57
                                                                                     ------------------      ------------------
     Total non-interest expense                                                                    242                     257
                                                                                     ------------------      ------------------
     Income before income taxes                                                                    262                     283
Income tax expense                                                                                  80                      93
                                                                                     ------------------      ------------------
     Net income                                                                                   $182                    $190
                                                                                     ==================      ==================

Dividends declared per common share                                                             $ 0.10                  $ 0.10
                                                                                     ==================      ==================
Basic earnings per common share                                                                 $ 0.21                  $ 0.21
                                                                                     ==================
                                                                                                             ==================
Diluted earnings per common share                                                               $ 0.21                  $ 0.21
                                                                                     ==================      ==================
</TABLE>

See notes to consolidated condensed financial statements.

                                     Page 2
<PAGE>

              CRAZY WOMAN CREEK BANCORP INCORPORATED AND SUBSIDIARY
                      Consolidated Condensed Statements of
                            Stockholders' Equity and
                        Comprehensive Income Three months
                        ended December 31, 1998 and 1997
                      (In thousands, except per share data)
<TABLE>
<CAPTION>
                                                                      Unearned                          Accumulated
                                                          Additional   ESOP/                               other          Total
                                              Common       paid-in      MSBP    Retained     Treasury  comprehensive   stockholders'
                                              stock        capital     shares   earnings      stock       income          equity
                                              ----------- -----------  -------- ----------- -----------  --------------  -----------
<S>                                              <C>        <C>         <C>       <C>        <C>              <C>        <C>    
  Balances at September 30, 1997                  $106       $10,042     $ (809)   $6,377     $ (1,582)        $  77      $14,211
  Comprehensive income:
    Net income                                                                        190                                     190
    Unrealized gains on available-for-sale
      investment securities, net                                                                                   8            8
                                                                                                                         -----------
        Total comprehensive income                                                                                            198
  Tax benefit from stock related compensation       --            14         --        --           --            --           14
  ESOP shares committed to be released              --             6         11        --           --            --           17
  MSBP shares vested                                --            --         15        --           --            --           15
  Cash dividends declared ($.10 per share)          --            --         --       (89)          --            --          (89)
                                              =========== ============  ========  ========= ===========  ==============  ===========
  Balances at December 31, 1997                   $106       $10,062     $ (783)   $6,478     $ (1,582)        $  85      $14,366
                                              =========== ============  ========  ========= ===========  ==============  ===========

  Balances at September 30, 1998                  $106       $10,083     $ (671)   $6,737     $ (2,427)        $ 208      $14,036
  Comprehensive income:
    Net income                                                                        182                                     182
    Unrealized gains on available-for-sale
      investment securities, net                                                                                   9            9
    Effect of change in classification of
      investment securities                                                                                       55           55
                                                                                                                         -----------
        Total comprehensive income                                                                                            246
  ESOP shares committed to be released              --             4         12        --           --            --           16
  MSBP shares vested                                --            --         12        --           --            --           12
  Cash dividends declared ($.10 per share)          --            --         --       (85)          --            --          (85)
                                              =========== ============  ========  ========= ===========  ==============  ===========
  Balances at December 31, 1998                   $106       $10,087     $ (647)   $6,834     $ (2,427)        $ 272      $14,225
                                              =========== ============  ========  ========= ===========  ==============  ===========
</TABLE>

See notes to consolidated condensed financial statements.

                                     Page 3
<PAGE>


              CRAZY WOMAN CREEK BANCORP INCORPORATED AND SUBSIDIARY
                 Consolidated Condensed Statements of Cash Flows
<TABLE>
<CAPTION>
                                                                                    Three Months Ended
                                                                                       December 31,
                                                                                   -------------------
                                                                                     1998       1997
                                                                                   ---------- --------
                                                                                       (In thousands)
<S>                                                                               <C>        <C>    
Cash flows from operating activities:                                                    (Unaudited)
  Net income                                                                       $   182    $   190
  Adjustments  to  reconcile  net  income  to net  cash  provided  by  operating
  activities:
      Provision for loan losses                                                          6       --
      Amortization of premiums and discounts on securities available-for-sale            5          1
      Federal Home Loan Bank stock dividends                                           (18)       (17)
      Depreciation                                                                       8         12
      Dividends reinvested                                                             (26)       (22)
      Deferred loan origination fees, net                                               13          3
      Loss on sale of premises and equipment                                          --            3
      ESOP shares committed to be released                                              16         17
      MSBP deferred compensation                                                        12         15
Change in:
      Accrued interest receivable                                                       38         25
      Other assets                                                                      23         25
      Income taxes payable                                                              81        (38)
      Accrued expenses and other liabilities                                            33          8
                                                                                   -------    -------
        Net cash provided by operating activities                                      372        222
                                                                                   -------    -------
Cash flows from investing activities:
  Purchases of securities available-for-sale                                        (6,545)    (6,997)
  Maturities and calls of securities available-for-sale                              6,075      4,166
  Maturities and calls of securities held-to-maturity                                 --        1,670
  Purchase of Federal Home Loan Bank stock                                            --          (49)
  Origination of loans receivable                                                   (3,349)    (1,865)
  Repayment of principal on loans receivable                                         2,834      1,759
  Purchase of premises and equipment                                                  --           (3)
                                                                                   -------    -------
    Net cash used in investing activities                                             (985)    (1,319)
                                                                                   -------    -------
Cash flows from financing activities:
  Net change in deposits                                                              (153)     1,001
  Advances from Federal Home Loan Bank                                               4,250      5,850
  Repayment of advances from Federal Home Loan Bank                                 (3,800)    (6,100)
  Net change in advances from borrowers for taxes and insurance                        (47)       (44)
  Dividends paid to stockholders                                                       (85)       (89)
                                                                                   -------    -------
    Net cash provided by financing activities                                          165        618
                                                                                   -------    -------
Net decrease in cash and cash equivalents                                             (448)      (479)
Cash and cash equivalents at beginning of period                                     1,562      1,194
                                                                                   -------    -------
Cash and cash equivalents at end of period                                         $ 1,114    $   715
                                                                                   =======    =======
</TABLE>

See notes to consolidated condensed financial statements.

                                     Page 4
<PAGE>


              Notes to Consolidated Condensed Financial Statements

                                December 31, 1998


NOTE 1:  BASIS OF PRESENTATION

The accompanying unaudited consolidated condensed financial statements have been
prepared in accordance with generally accepted  accounting  principles  ("GAAP")
for interim financial information.  Accordingly,  they do not include all of the
information and footnotes required by generally accepted  accounting  principles
for complete financial  statements.  For further information,  the reader should
refer to the  Annual  Report of Crazy  Woman  Creek  Bancorp  Incorporated  (the
"Company") for the year ended September 30, 1998.

In the opinion of management,  all adjustments  (consisting of normal  recurring
accruals)  considered  necessary for fair presentations have been included.  The
results of operations  for the three months ended December 31, 1998 and 1997 are
not  necessarily  indicative  of the results which may be expected for an entire
year or any other period.

The accompanying  consolidated  financial statements include the accounts of the
Company and Buffalo Federal Savings Bank (the "Bank"), a wholly owned subsidiary
of the Company. All significant intercompany balances and transactions have been
eliminated in consolidation.

The  Company  may  from  time  to time  make  written  or oral  "forward-looking
statements",  including  statements  contained in the Company's filings with the
Securities and Exchange Commission (including this Quarterly Report on Form 10-Q
and  the  exhibits  thereto),  in its  reports  to  stockholders  and  in  other
communications  by the  Company,  which  are made in good  faith by the  Company
pursuant to the "safe  harbor"  provision of the Private  Securities  Litigation
Reform Act of 1995.

These  forward-looking  statements  involve  risks  and  uncertainties,  such as
statements  of the  Company's  plans,  objective,  expectations,  estimates  and
intentions,  that are subject to change based of various important factors (some
of which are beyond the Company's control). The following factors, among others,
could cause the Company's  financial  performance to differ  materially from the
plans,  objective,  expectations,  estimates  and  intentions  expressed in such
forward-looking statements: the strength of the United States economy in general
and the strength of the local economy in which the Company conducts  operations;
the effects of, and changes in,  trade,  monetary and fiscal  policies and laws,
including  interest  rate  policies  of the board of  governors  of the  federal
reserve system, inflation, interest rates, market and monetary fluctuations; the
timely development of and acceptance of new products and services of the Company
and the  perceived  overall  value of these  products  and  services  by  users,
including the features,  pricing and quality  compared to competitors'  products
and services;  the willingness of users to substitute  competitors' products and
services for the Company's products and services;  the success of the Company in
gaining  regulatory  approval of its products and services,  when required;  the
impact of changes in financial  services' laws and  regulations  (including laws
concerning taxes,  banking,  securities and insurance);  technological  changes;
acquisitions; changes in consumer spending and saving habits; and the success of
the Company at managing the risks resulting from these factors.

The Company cautions that the listed factors are not exclusive. The Company does
not undertake to update any forward-looking statement,  whether written or oral,
that may be made from time to time by or on behalf of the Company.

                                     Page 5
<PAGE>
              Notes to Consolidated Condensed Financial Statements

                                December 31, 1998


NOTE 2:  RECENT ACCOUNTING PRONOUNCEMENTS

Effective  October 1, 1998,  the Company  adopted the  provision of Statement of
Financial  Accounting  Standards  ("SFAS") No. 133,  Accounting  for  Derivative
Instruments and Hedging  Activities (SFAS 133). SFAS 133 establishes  accounting
and reporting  standards that every  derivative  instrument  (including  certain
derivative  instruments  embedded in other contracts) be recorded in the balance
sheet as either  an asset or  liability  measured  at its fair  value.  SFAS 133
requires that changes in the derivatives  fair value be recognized  currently in
earnings unless specific hedge accounting criteria are met. The adoption of SFAS
133 had no impact on the  financial  statements  of the  Company  except that it
allowed  for a  one-time  reclassification  of  the  investment  portfolio  from
held-to-maturity to either trading or available-for-sale.  The net effect on the
balance  sheet of this  reclassification  was an  increase  in total  assets  of
$84,000,  deferred tax liabilities of $29,000 and unrealized gains on securities
available-for-sale of $55,000. (See also Note 3: Comprehensive Income).

NOTE 3:  COMPREHENSIVE INCOME

Effective  October  1,  1998,  the  Company  adopted  SFAS  No.  130,  Reporting
Comprehensive   Income  (SFAS  130).  SFAS  130  requires  companies  to  report
comprehensive  income.  Comprehensive income will include net income, as well as
other changes in stockholders' equity that result from transactions and economic
events  other than those  with  stockholders.  The  Company's  only  significant
element   of   comprehensive   income  is   unrealized   gains  and   losses  on
available-for-sale  securities.  There were no  reclassification  adjustments to
other  comprehensive  income for holding gains and losses realized during either
of the periods.  Unrealized gains reported as other comprehensive  income during
the three months  ending  December  31, 1998 and 1997 are net of related  income
taxes of $4,600 and $4,100, respectively.

NOTE 5:  EARNINGS PER SHARE

The Company has adopted the provision of SFAS 128,  Earnings Per Share. SFAS No.
128  replaces  presentation  of primary  and fully  diluted  earnings  per share
("EPS") with the presentation of basic and diluted EPS. Basic EPS is computed by
dividing net income by the weighted-average  number of common shares outstanding
during  the  period  less  unvested  management  stock  bonus  plan  (MSBP)  and
unallocated ESOP shares. Diluted EPS is calculated by dividing net income by the
weighted-average  number of common  shares  used to  compute  basic EPS plus the
incremental  amount of potential  common stock  determined by the treasury stock
method.


                                     Page 6
<PAGE>
              Notes to Consolidated Condensed Financial Statements

                                December 31, 1998



<TABLE>
<CAPTION>

                                           For the three months ended December 31, 1998
                                           --------------------------------------------
                                                            Average    Per-Share
                                                  Income     Shares     Amount
                                                 ------------------- -----------
<S>                                             <C>         <C>       <C>     
Basic EPS
  Net income available to common stockholders    $182,000    870,297   $   0.21
                                                                           ====
Effect of Dilutive Securities
  Incremental shares under stock option plan         --        7,316
  Incremental shares related to MSBP                 --          786
                                                  -------    -------

Diluted EPS
  Income available to common stockholders plus
    assumed conversions                          $182,000    878,399   $   0.21
                                                 ========    =======       ====
</TABLE>

<TABLE>
<CAPTION>
                                            For the three months ended December 31, 1997
                                            --------------------------------------------
                                                             Average   Per-Share
                                                  Income     Shares      Amount
                                                 --------   --------   ---------
<S>                                            <C>         <C>       <C>     
Basic EPS
  Net income available to common stockholders    $190,000    904,085   $   0.21
                                                                           ====
Effect of Dilutive Securities
  Incremental shares under stock option plan         --       16,989
  Incremental shares related to MSBP                 --        3,468
                                                 --------     ------
Diluted EPS
  Income available to common stockholders plus
    assumed conversions                          $190,000    924,542   $   0.21
                                                 ========    =======       ====

</TABLE>

                                     Page 7
<PAGE>


            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS



GENERAL
-------

The  Company is a unitary  savings  and loan  holding  company of the Bank.  The
Company's  assets are  comprised  of its  investment  in the Bank,  loans to the
Bank's  Employee  Stock  Ownership  Plan ("ESOP") and to the Bank, and shares in
three mutual  funds.  The Bank operates as a  traditional  savings  association,
attracting  deposit  accounts from the general public and using those  deposits,
together  with other  funds,  primarily to  originate  and invest in  fixed-rate
conventional  loans secured by single-family  residential real estate.  The Bank
also  originates  home  equity,  consumer  loans and loans  secured  by  savings
accounts.  The Bank also  invests  in  mortgage-backed  (including  Real  Estate
Mortgage Investment Conduits  ("REMICs")),  municipal bonds, and short-term U.S.
Agency  securities.  To a lesser extent,  the Bank  originates  commercial  real
estate loans and business  loans.  The Bank  utilizes  funds  obtained  from the
Federal Home Loan Bank of Seattle ("FHLB") to purchase investment securities and
to originate loans.

The Bank's net earnings  are  dependent  primarily  on its net interest  income,
which is the difference  between interest income earned on its  interest-earning
assets and interest expense paid on interest-bearing  liabilities.  Net interest
income  is  determined  by  (i)  the   difference   between   yields  earned  on
interest-earning assets and rate paid on interest-bearing  liabilities (interest
rate  spread)  and (ii) the  relative  amounts  of  interest-earning  assets and
interest-bearing  liabilities.  The Bank's  interest  rate spread is affected by
regulatory, economic and competitive factors that influence interest rates, loan
demand and deposit flows.  To a lesser extent,  the Bank's net earnings also are
affected  by the level of  non-interest  income,  which  primarily  consists  of
service  charges and other  operating  income.  In  addition,  net  earnings are
affected by the level of non-interest (general and administrative) expenses.

FINANCIAL CONDITION
-------------------

At December 31, 1998,  assets totaled $62.70 million compared to total assets of
$62.15 million at September 30, 1998. Asset growth was primarily attributed to a
$4.53 million  increase in  investments  securities  available-for-sale  and the
related $3.94 million decrease in  held-to-maturity  securities,  as a result of
the adoption of SFAS 133. Loans also increased by $430,000 and cash decreased by
$448,000.  Deposits  decreased by $153,000 from $32.91  million at September 30,
1998 to $32.76  million at December 31, 1998 primarily as a result of a decrease
in business  checking.  Advances  from the FHLB  increased by $450,000 to $15.10
million at December 31, 1998.

At December 31, 1998,  stockholder's  equity totaled $14.23 million or 22.70% of
total assets  compared to $14.04  million or 22.59% of total assets at September
30, 1998.  The increase in  stockholder's  equity was primarily due to continued
earnings  and  an  increase  in  the  market  value  of  investment   securities
available-for-sale.  The increase in stockholder's equity was somewhat offset by
cash dividends of $85,000.

ASSET QUALITY
-------------

Non-performing  assets totaled  $324,000 at December 31, 1998, or 0.52% of total
assets.  This  compares  to  $225,000  at  September  30, 1998 or 0.36% of total
assets.  Non-performing  loans  at  December  31,  1998  were  comprised  of two
residential  home  loans,  six  consumer  loans  and one  residence  held  under
judgment.

                                     Page 8

<PAGE>
            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                      AND RESULTS OF OPERATIONS (Continued)


RESULTS OF OPERATIONS
---------------------

Comparison of Three Months Ended December 31, 1998 and 1997.
------------------------------------------------------------

Net Income.  Net income for the three  months  ended  December  31, 1998 totaled
$182,000  compared to $190,000 for the three months ended December 31, 1997. Net
income was lower in 1998 than in 1997 primarily due to a $34,000 decrease in net
interest income. The decrease in net income was offset with a $4,000 increase in
non-interest income and a $15,000 decline in non-interest expense. Net income in
1998 was negatively affected by a $6,000 provision for loan losses.  Federal tax
expense was $13,000  lower in 1998 than in 1997  primarily  due to a decrease in
net income before tax expense and a increase in non-taxable investments.

Interest Income.  For the three months ended December 31, 1998,  interest income
totaled  $1.09  million  compared to $1.13  million for the three  months  ended
December  31,  1997.  An increase in the volume of average  earning  assets from
$59.31  million for the three months ended  December 31, 1997 to $60.85  million
for the same period in 1998  caused  interest  income to increase by $77,000.  A
decrease was  experienced in the yield on average  earning assets from 7.62% for
the three  months  ended  December  31, 1997 to 7.16% for the three months ended
December 31, 1998, attributed to a $118,000 decrease in interest income.

Interest  Expense.  Total interest expense decreased by $7,000 from $612,000 for
the three months ended December 31, 1997 to $605,000 million for the same period
in 1998.  This was primarily a result of a increase in the volume and a decrease
in the cost of average interest-bearing liabilities.

The cost of average interest-bearing deposits decreased from 5.12% for the three
months ended  December 31, 1997 to 4.98% for the three months ended December 31,
1998,  which  caused  interest  expense for  deposits to decrease by $10,000.  A
increase in the volume of average interest-bearing  deposits from $29.85 million
for the three  months ended  December  31, 1997 to $32.35  million for the three
months  ended  December  31,  1998,  resulted in a $31,000  increase in interest
expense for deposits.

The cost of average interest-bearing advances from the FHLB decreased from 5.96%
for the three  months  ended  December  31, 1997 to 5.69% for the same period in
1998.  This  decrease  in cost of average  interest-bearing  advances  caused an
$11,000  decrease  in  interest  expense.  Average   interest-bearing   advances
decreased from $15.43 million for the three month period ended December 31, 1997
to $14.20 million for the three month period ended December 31, 1998,  resulting
in a $17,000 decrease in interest expense for advances.

Net Interest Income.  Net interest income decreased by $34,000 from $518,000 for
the three months ended  December 31, 1997 to $484,000 for the three months ended
December 31, 1998. The decrease in net interest  income was primarily  caused by
the declining interest rates on the investment  portfolio and the loan portfolio
but is  somewhat  offset by the  declining  cost of  liabilities.  Although  the
increase in average  interest-bearing  liabilities  was similar to the growth in
average  earning  assets as  evidenced  by the slight  decrease  of the ratio of
average earning assets to average  interest-bearing  liabilities from 130.96% in
1997 to 130.71% in 1998 , net interest income decreased.

Net interest  margin declined from 3.49% for the three months ended December 31,
1997 to 3.18% for the three months ended  December 31, 1998. The decrease in net
interest  margin was  primarily  caused by the cost of average  interest-bearing
liabilities  decreasing  at a slower  pace  than the yield on  average  interest
earning assets for the periods covered.

                                    Pagae 9
<PAGE>
            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                      AND RESULTS OF OPERATIONS (Continued)


Provisions for Credit Losses.  The Company  recorded a $6,000 provision for loan
losses for the three months ended December 31, 1998; no provisions were recorded
during the three months ended December 31, 1997. Loan  charge-offs for the three
months ended December 31, 1998 totaled $5,000 while  recoveries  totaled $3,000.
In 1997, loan charge-offs  totaled $39,000 while recoveries  totaled $3,000.  In
determining  the provision  for loan losses,  management  analyzes,  among other
things, the composition of the Bank's loan portfolio,  market conditions and the
Bank's market area.  Management has determined  that the reserve for loan losses
is adequate to cover any  anticipated  credit losses.  There can be no assurance
that the reserve for loan losses will be adequate to cover  losses  which may be
realized in the future and that additional provisions will not be required.

Total Non-interest  Income.  Total non-interest  income increased by $4,000 from
$22,000 for the three  months  ended  December 31, 1997 to $26,000 for the three
months  ended  December  31, 1998  primarily  due to an slight  decrease in fees
generated from service charges and an increase in loan origination fees.

Total Non-interest Expense.  Total non-interest expense declined by $15,000 from
$257,000 for the three months ended  December 31, 1997 to $242,000 for the three
months ended December 31, 1998.  The decrease was primarily  attributed to lower
compensation expenses and other non-interest expenses. There were no significant
changes in the other components of non-interest expense.

Non-interest  expense  for the three  months  ended  December  31, 1998 does not
contain any direct costs  associated  with the Company's  efforts to upgrade its
data processing systems to address the change to the year 2000. The Company does
not believe  that its costs to comply with the change to the year 2000 will have
a material  effect on its financial  position or results of operation.  However,
despite the best efforts of management to address this issue, the vast number of
external entities that have direct and indirect business  relationships with the
Company,  such  as  customers,  vendors,  payment  system  providers  and  other
financial institutions,  makes it impossible to assure that a failure to achieve
compliance by one or more of these  entities  would not have a material  adverse
impact on the results of operation or financial condition of the Company.

YEAR 2000
---------

The Year 2000 problem  exists  because many computer  programs use only the last
two  digits to refer to a year.  This  convention  could  affect  date-sensitive
calculations  that treat "00" as the year 1900,  rather that 2000. An additional
issue is that 1900 was not a leap  year,  whereas  the year 2000 is.  Therefore,
some programs may not properly provide for February 29, 2000. This anomaly could
result is miscalculations  when processing critical  date-sensitive  information
after December 31, 1999.

The following  discussion of the  implications  of the Year 2000 problem for the
Company  contains  numerous  forward-looking   statements  based  on  inherently
uncertain information. The cost of the project and the date on which the Company
plans to complete the internal Year 2000 modifications are based on management's
best estimates,  which were derived  utilizing a number of assumptions of future
events including the continued  availability of internal and external resources,
third party modifications and other factors.  However, there can be no guarantee
that these estimates will be achieved and actual results could differ. Moreover,
although management believes it will be able to make the necessary modifications
in advance,  there can be no guarantees that failure to modify the systems would
not have a material adverse affect on the Company.

In  addition,  the  Company  places a high degree of reliance on its third party
processor and computer  systems of other  financial  institutions.  Although the
Company  is  assessing  the  readiness  of these  other  parties  and  preparing
contingency  plans,  there can be no  guarantee  that the failure of these other
parties to modify their systems in advance of December 31, 1999 would not have a
material adverse affect on the Company.

                                    Page 10
<PAGE>
            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                      AND RESULTS OF OPERATIONS (Continued)

During fiscal 1998, the Company adopted a Year 2000 Action Plan (the "Plan") and
established a Year 2000 Committee (the "Committee").  The objectives of the Plan
and the  Committee  are to  prepare  the  Company  for the  new  millennium.  As
recommended by the Federal Financial Institutions Examination Council ("FFIEC"),
the Plan encompasses the following phases:  Awareness,  Assessment,  Renovation,
Validation and Implementation.  These phases will enable the Company to identify
risks,   develop  an  action  plan,   perform   adequate  testing  and  complete
certification that its processing systems will be Year 2000 ready.  Execution of
the Plan is currently on  schedule.  The Company is currently in the  Renovation
phase, which includes program changes, hardware and software upgrades and system
replacements,  if necessary.  Concurrently,  the Company is also addressing some
issues  related  to  subsequent  phases.  Prioritization  of the  most  critical
applications has been addressed, along with contract and service agreements. The
primary  operating  software  for the Company is obtained and  maintained  by an
external  service  center (the  "Service  Center").  The Company has  maintained
ongoing contact with the Service Center so that modification of the software for
the Year 2000  readiness is a top  priority and is expected to be  accomplished,
though there is no assurance,  by June 30, 1999. The Service Center is completed
with their Renovation  phase and is in the process of the Validation  phase. The
Company has contacted all other major vendors and suppliers regarding their Year
2000 state of  readiness.  Each of these  third  parties has  delivered  written
assurance  to the Company that they expect the be Year 2000  compliant  prior to
the Year 2000. These third parties also supply, at least quarterly, an update of
their   progress.   The  Company  has  contacted  all  material   customers  and
non-information  technology suppliers (i.e., utility systems,  telephone systems
and security systems), regarding their Year 2000 state of readiness. The Bank is
unable to test the Year 2000 readiness of our significant  supplier of utilities
and is relying on the utility companies'  internal testing and representation to
provide the required services that drive the Bank's data systems.

The  Renovation  phase is targeted for  completion  by February  28,  1999.  The
Validation   phase  involves  testing  of  changes  to  hardware  and  software,
accompanied  by monitoring  and testing with vendors.  The  Validation  phase is
targeted for completion by June 30, 1999. The Implementation phase is to certify
that systems are Year 2000 ready, along with assurances that any new systems are
compliant on a going-forward  basis.  The  Implementation  phase is targeted for
completion by September 30, 1999.

Costs will be incurred due to the  replacement  of  non-compliant  computers and
software. The Company does not anticipate that the related overall costs will be
material in any single year. In total,  the Company  estimated that its cost for
compliance will amount to approximately  $15,000 over the three year period from
1998-2000,  of which approximately  $3,000 was incurred as of December 31, 1998.
The Company does not separately track the internal  personnel costs incurred for
the  Year  2000  compliance.  No  assurance  can be given  that  the  Year  2000
Compliance Plan will be completed  successfully by the Year 2000, in which event
the Company could incur  significant  costs.  If the Service Center is unable to
resolve the  potential  problem in time,  the Company  would  likely  experience
significant data processing delays, mistakes or failures. These delays, mistakes
or failures could have a significant adverse impact on the financial  statements
of the Company.

One of the guidelines from the FFIEC is to establish a Contingency  Plan for all
possible Year 2000 failures. During fiscal 1998, the Company adopted a Year 2000
Contingency  Plan. The objective of the  Contingency  Plan is to prepare for any
Year 2000  failures.  These  failures  could result from  internal  software and
hardware,  the Service  Center,  and/or  third  parties  (utilities,  telephone,
suppliers,  and other banks).  The Contingency Plan is continually being revised
based on new  information  and  updates  on the Year 2000  conversions  of third
parties and other vendors.

Provision  for Income  Taxes.  The effective tax rate for the three months ended
December 31, 1998 and 1997 was 30.59% and 32.87%,  respectively.  The  effective
tax rate decreased due to increased investments in non-taxable  investments such
as municipal bonds.

                                    Page 11
<PAGE>
            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                      AND RESULTS OF OPERATIONS (Continued)


CAPITAL COMPLIANCE AND LIQUIDITY
--------------------------------

Capital Compliance.  The following table presents the Bank's compliance with its
regulatory capital requirements:

                                                         At December 31, 1998
                                                         ----------------------
                                                                    Percentage
                                                           Amount    of Assets
                                                           ------    ---------
                                                          (Dollars in Thousands)
GAAP Capital ..........................................   $11,884

Tangible capital ......................................   $11,795      19.26%
Tangible capital requirement ..........................       916       1.50%
Excess ................................................   $10,879      17.76%
                                                           ======       ====

Core capital ..........................................   $11,795      19.26%
Core capital requirements .............................     1,834       3.00%
Excess ................................................   $ 9,961      16.26%
                                                          =======      ===== 

Total risk-based capital (1) ..........................   $12,083      48.15%
Total risk-based capital requirement (1) ..............     2,008       8.00%
                                                          -------      ----- 
Excess (1) ............................................   $10,075      40.15%
                                                          =======      ===== 

1)  Based on risk-weighted assets of $25,093

Management  believes that under current  regulations,  the Bank will continue to
meet its minimum capital  requirements in the foreseeable future.  Events beyond
the control of the Bank,  such as increased  interest rates or a downturn in the
economy  in areas in which  the Bank  operates  could  adversely  affect  future
earnings  and, as a result,  the ability of the Bank to meet its future  minimum
capital requirements.

Liquidity.  The Bank's  liquidity is a measure of its ability to fund loans, pay
withdrawals of deposits, and other cash outflows in an efficient, cost effective
manner.   The  Bank's  primary  source  of  funds  are  deposits  and  scheduled
amortization  and prepayment of loans.  During the past several years,  the Bank
has used such funds  primarily  to fund  maturing  time  deposits,  pay  savings
withdrawals,  fund lending commitments,  purchase new investments,  and increase
liquidity.  The Bank  funds  its  operations  internally  but  supplements  with
borrowed  funds from the FHLB of Seattle.  As of December 31, 1998 such borrowed
funds totaled $15.10 million. Loan payments and maturing investments are greatly
influenced by general interest rates, economic conditions and competition.

The Bank is required  under federal  regulations to maintain  certain  specified
levels of "liquid  investments,"  which include certain United States government
obligations and other approved investments. Current regulations require the Bank
to maintain liquid assets of not less than 4% of its net  withdrawable  accounts
plus short-term borrowings. Those levels may be changed from time to time by the
regulators  to  reflect  current  economic  conditions.  The Bank has  generally
maintained  liquidity  far in  excess of  regulatory  requirements.  The  Bank's
regulatory  liquidity  was  61.17%  and 11.17% at  December  31,  1998 and 1997,
respectively.  Recent regulatory changes regarding assets eligible for liquidity
caused the significant  increase in the Bank's regulatory  liquidity ratios from
1997 to 1998; specifically, the maturity restrictions were lifted on U.S. Agency
securities.

                                    Page 12
<PAGE>
            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                      AND RESULTS OF OPERATIONS (Continued)


The amount of  certificate  of deposit  accounts  which are  scheduled to mature
during the twelve  months  ending  December  31,  1999 is  approximately  $11.93
million.  To the  extent  that  these  deposits  do not  remain at the Bank upon
maturity,  the Bank  believes  that it can replace  these  funds with  deposits,
excess liquidity,  FHLB advances or outside  borrowings.  It has been the Bank's
experience  that a substantial  portion of such maturing  deposits remain at the
Bank.

At December 31, 1998,  the Bank had loan  commitments  outstanding  of $384,000.
Funds  required to fill these  commitments  are derived  primarily  from current
excess  liquidity,  deposit  inflows  or loan,  investment  and  mortgage-backed
security repayments.

IMPACT OF INFLATION AND CHANGING PRICES
---------------------------------------

The  consolidated  condensed  financial  statements  of the  Company  and  notes
thereto, presented elsewhere herein, have been prepared in accordance with GAAP,
which require the  measurement  of financial  position and operating  results in
terms of  historical  dollars  without  considering  the change in the  relative
purchasing power of money over time due to inflation. The impact of inflation is
reflected  in the  increased  cost  of the  Company's  operations.  Unlike  most
industrial  companies,  nearly all the assets and liabilities of the Company are
financial.  As a result,  interest  rates have a greater impact on the Company's
performance  than do the effects of general levels of inflation.  Interest rates
do not  necessarily  move in the same  direction  or to the same  extent  as the
prices of goods and services.

KEY OPERATING RATIOS
--------------------
<TABLE>
<CAPTION>
                                                                    Three Months Ended
                                                                        December 31,
                                                          -----------------------------------------
                                                              1998 (1)              1997 (1)
                                                          -------------------    ------------------
                                                                  (Dollars in Thousands,
                                                                   except per share data)
                                                                       (Unaudited)
<S>                                                            <C>                   <C>  
Return on average assets                                         1.18%                 1.26%
Return on average equity                                         5.15%                 5.31%
Interest rate spread                                             1.96%                 2.22%
Net interest margin                                              3.18%                 3.49%
Non-interest expense to average assets                           1.56%                 1.70%
Net charge-offs to average outstanding loans                    (0.01)%               (0.13)%

</TABLE>

<TABLE>
<CAPTION>

                                                           At December 31,       At September 30,
                                                               1998                  1998
                                                           ---------------       ----------------
<S>                                                           <C>                   <C>
Nonaccrual and 90 days past due loans                             256                   225
Repossessed real estate, held under judgment                       68                     0
  Total non-performing assets                                     324                   225
Allowance for credit losses to non-performing assets            88.98%               134.22%
Non-performing loans to total loans                              1.04%                 0.79%
Non-performing assets to total assets                            0.52%                 0.36%
Book value per share (2)                                       $15.64                $15.44

</TABLE>

----------------
(1)  The ratios for the three-month periods are annualized.
(2)  The number of shares  outstanding as of December 31, 1998 and September 30,
     1998 were 909,261. These include shares purchased by the ESOP.

                                    Page 13
<PAGE>


                           PART II - OTHER INFORMATION
                           ---------------------------

Item 1.  Legal Proceedings
         -----------------

                  Neither  the  Company  nor the Bank was  engaged  in any legal
                  proceeding  of a material  nature at December 31,  1998.  From
                  time to time,  the Company is a party to legal  proceedings in
                  the  ordinary  course of  business  wherein  it  enforces  its
                  security interest in loans.

Item 2.  Changes in Securities
         ---------------------

                  Not applicable.

Item 3.  Defaults Upon Senior Securities
         -------------------------------

                  Not applicable.

Item 4.  Submission of Matters to a Vote of Security Holders
         ---------------------------------------------------

                  Not applicable

Item 5.  Other Information
         -----------------

                  Not applicable

Item 6.  Exhibits and Reports on Form 8-K
         --------------------------------

                  (a)      Exhibits

                           Exhibit 27 -- Financial Disclosure Schedule 
                                         (in electronic filing only)

                  (b)      Reports on Form 8-K

                           None.


                                    Page 14
<PAGE>






              CRAZY WOMAN CREEK BANCORP INCORPORATED AND SUBSIDIARY

                                   SIGNATURES


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


                               CRAZY WOMAN CREEK BANCORP INCORPORATED



Date: February 12, 1999        By: /s/ Deane D. Bjerke                    
                                   ---------------------------------------------
                                   Deane D. Bjerke
                                   President and Chief Executive Officer
                                   (Principal Executive Officer)



Date: February 12, 1999        By: /s/ John B. Snyder                      
                                   ---------------------------------------------
                                   John B. Snyder
                                   Vice President and Chief Financial Officer
                                   (Principal Accounting and Financial Officer)