**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      D.C. 20549**

**———————————**

**FORM      10-Q**

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

**For      the Quarterly Period Ended September 30, 2007**

**OR**

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

**For      the transition period from _______________ to      _______________**

**Commission      File Number 000-30707**

**First      Northern Community Bancorp**

| **California**                                                                | **68-0450397**                                         |
|-------------------------------------------------------------------------------|--------------------------------------------------------|
| (State                or other jurisdiction of incorporation or organization) | (I.R.S.                Employer Identification Number) |

| **195                N. First Street, Dixon, California** | **95620**                 |
|-----------------------------------------------------------|---------------------------|
| (Address                of principal executive offices)   | (Zip                Code) |

**707-678-3041**

| **Yes  **x | **No  ** ̈ |
|----------------------|--------------------------|

| **Large                accelerated filer   ** ̈ | **Accelerated                filer  **x | **Non-accelerated                filer  ** ̈ |
|--------------------------------------------------------------------|---------------------------------------------------|------------------------------------------------------------|

| **                         Yes  ** ̈ | **                         No  **x |
|-------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------|

----

**FIRST      NORTHERN COMMUNITY BANCORP**

**INDEX**

|                                                                    |   | **Page**                                                                                                                        |
|-------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------|
|                                                                    |   |                                                                                                                            |
| **PART                I:    FINANCIAL INFORMATION** |   |                                                                                                                            |
|                                                                    |   |                                                                                                                            |   |   |
| Item                1                                                   |   | Consolidated                Financial Statements                                                                                |   |   |
|                                                                    |   |                                                                                                                            |   |   |
|                                                                    |   | Unaudited                Condensed Consolidated Balance Sheets                                                                  |   | 3 |
|                                                                    |   |                                                                                                                            |   |   |
|                                                                    |   | Unaudited                Condensed Consolidated Statements of Income                                                            |   | 4 |
|                                                                    |   |                                                                                                                            |   |   |
|                                                                    |   | Unaudited                Condensed Consolidated Statement of Stockholders’ Equity and Comprehensive                Income |   | 5 |
|                                                                    |   |                                                                                                                            |   |   |
|                                                                    |   | Unaudited                Condensed Consolidated Statements of Cash Flows                                                        |   | 6 |
|                                                                    |   |                                                                                                                            |   |   |
|                                                                    |   | Notes                to Unaudited Condensed Consolidated Financial Statements                                                   |   | 7 |
|                                                                    |   |                                                                                                                            |   |   |
| Item                2                                                   |   | Management’s                Discussion and Analysis of Financial Condition and Results of                Operations       |   | 17 |
|                                                                    |   |                                                                                                                            |   |   |
| Item                3                                                   |   | Quantitative                and Qualitative Disclosures About Market Risk                                                       |   | 32 |
|                                                                    |   |                                                                                                                            |   |   |
| Item                4                                                   |   | Controls                and Procedures                                                                                          |   | 32 |
|                                                                    |   |                                                                                                                            |   |   |
| **PART                II:    OTHER INFORMATION**    |   |                                                                                                                            |
|                                                                    |   |                                                                                                                            |   |   |
| Item                1A                                                  |   | Risk                Factors                                                                                                     |   | 33 |
|                                                                    |   |                                                                                                                            |   |   |
| Item                2                                                   |   | Unregistered                Sales of Equity Securities and Use of Proceeds                                                      |   | 33 |
|                                                                    |   |                                                                                                                            |   |   |
| Item                6                                                   |   | Exhibits                                                                                                                        |   | 34 |
|                                                                    |   |                                                                                                                            |   |   |
| Signatures                                                              |   | 34                                                                                                                              |

----

**PART      I - FINANCIAL INFORMATION**

**ITEM      1.**

**CONSOLIDATED      FINANCIAL STATEMENTS**

***CONDENSED      CONSOLIDATED BALANCE SHEETS***

|                                                                                                                                                                        |   | (UNAUDITED)                       |    |   |                             |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|---------|--------|----------------------------------|--------|
|                                                                                                                                                                        |   | September                30, 2007 |    |   | December                31, 2006 |   |
| ASSETS                                                                                                                                                                      |   |                              |    |   |                             |   |
| Cash                and due from banks                                                                                                                                      |   | $                                 | 52,007  |   |                             | $      | 35,531 |   |
| Federal                funds sold                                                                                                                                           |   |                              | 4,815   |   |                             |   | 62,470 |   |
| Investment                securities – available-for-sale                                                                                                             |   |                              | 89,377  |   |                             |   | 74,180 |   |
| Loans,                net of allowance for loan losses of                                                                                                                   |   |                              |    |   |                             |   |   |   |
| $9,153                at September 30, 2007 and $8,361 at December 31, 2006                                                                                                 |   |                              | 508,742 |   |                             |   | 475,549 |   |
| Loans                held-for-sale                                                                                                                                          |   |                              | 1,618   |   |                             |   | 4,460 |   |
| Stock                in Federal Home Loan Bank and other equity                securities,    at cost                                                   |   |                              | 2,172   |   |                             |   | 2,093 |   |
| Premises                and equipment, net                                                                                                                                  |   |                              | 7,929   |   |                             |   | 8,060 |   |
| Other                Real Estate Owned                                                                                                                                      |   |                              | 252     |   |                             |   | 375 |   |
| Accrued                interest receivable and other assets                                                                                                                 |   |                              | 23,421  |   |                             |   | 22,507 |   |
|        TOTAL ASSETS                                                                                                                 |   | $                                 | 690,333 |   |                             | $      | 685,225 |   |
|                                                                                                                                                                        |   |                              |    |   |                             |   |   |   |
| LIABILITIES                AND STOCKHOLDERS' EQUITY                                                                                                                         |   |                              |    |   |                             |   |   |   |
| Liabilities                                                                                                                                                                 |   |                              |    |   |                             |   |   |   |
|                                                                                                                                                                        |   |                              |    |   |                             |   |   |   |
| Deposits                                                                                                                                                                    |   |                              |    |   |                             |   |   |   |
| Demand                deposits                                                                                                                                              |   | $                                 | 192,949 |   |                             | $      | 197,498 |   |
| Interest-bearing                transaction deposits                                                                                                                        |   |                              | 130,745 |   |                             |   | 117,620 |   |
| Savings                and MMDA's                                                                                                                                           |   |                              | 169,405 |   |                             |   | 175,128 |   |
| Time,                under $100,000                                                                                                                                         |   |                              | 44,591  |   |                             |   | 47,137 |   |
| Time,                $100,000 and over                                                                                                                                      |   |                              | 70,130  |   |                             |   | 66,299 |   |
|        Total deposits                                                                                                               |   |                              | 607,820 |   |                             |   | 603,682 |   |
| FHLB                Advances and other borrowings                                                                                                                           |   |                              | 10,678  |   |                             |   | 10,981 |   |
| Accrued                interest payable and other liabilities                                                                                                               |   |                              | 7,773   |   |                             |   | 8,572 |   |
|        TOTAL LIABILITIES                                                                                                            |   |                              | 626,271 |   |                             |   | 623,235 |   |
|                                                                                                                                                                        |   |                              |    |   |                             |   |   |   |
| Stockholders'                equity                                                                                                                                         |   |                              |    |   |                             |   |   |   |
| Common                stock, no par value; 16,000,000 shares authorized;                                                                                                    |   |                              |    |   |                             |   |   |   |
| 8,250,828                shares issued and outstanding at September 30, 2007 and 7,980,952                shares                issued and outstanding at December 31, 2006 |   |                              | 52,644  |   |                             |   | 45,726 |   |
| Additional                paid in capital                                                                                                                                   |   |                              | 977     |   |                             |   | 977 |   |
| Retained                earnings                                                                                                                                            |   |                              | 11,022  |   |                             |   | 15,792 |   |
| Accumulated                other comprehensive loss                                                                                                                         |   |                              | (581    | )      |                             |   | (505 | ) |
|        TOTAL STOCKHOLDERS' EQUITY                                                                                              |   |                              | 64,062  |   |                             |   | 61,990 |   |
|                                                                                                                                                                        |   |                              |    |   |                             |   |   |   |
|        TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                                    |   | $                                 | 690,333 |   |                             | $      | 685,225 |   |

----

***UNAUDITED      CONDENSED CONSOLIDATED STATEMENTS OF INCOME***

|                                                                                                                                                                                                                                                                                               |   | Three                months       |   |   | Three                months       |   |    | Nine                months        |   |   | Nine                months        |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|--------|--------|-----------------------------------|--------|---------|-----------------------------------|--------|--------|-----------------------------------|--------|
|                                                                                                                                                                                                                                                                                               |   | ended                             |   |   | ended                             |   |    | ended                             |   |   | ended                             |   |
|                                                                                                                                                                                                                                                                                               |   | September                30, 2007 |   |   | September                30, 2006 |   |    | September                30, 2007 |   |   | September                30, 2006 |   |
| Interest                and Dividend Income                                                                                                                                                                                                                                                   |   |                              |   |   |                              |   |    |                              |   |   |                              |   |
|      Loans                                                                                                                                                                                                                                                                |   | $                                 | 10,681 |   |                              | $      | 11,070  |                              |   | $      | 31,435                            |   |   | $ | 31,189 |   |
|      Federal funds sold                                                                                                                                                                                                                                         |   |                              | 384    |   |                              |   | 506     |                              |   |   | 2,236                             |   |   |   | 2,117 |   |
|      Due                from interest bearing                                                                                                                                                                                                                             |   |                              | 116    |   |                              |   | — |                              |   |   | 116                               |   |   |   | — |   |
|      Investment securities                                                                                                                                                                                                                                           |   |                              |   |   |                              |   |    |                              |   |   |                              |   |   |   |   |   |
|           Taxable                                                                                                                                                                                                                                |   |                              | 779    |   |                              |   | 644     |                              |   |   | 2,113                             |   |   |   | 1,814 |   |
|           Non-taxable                                                                                                                                                                                                                            |   |                              | 335    |   |                              |   | 162     |                              |   |   | 915                               |   |   |   | 436 |   |
|      Other                earning assets                                                                                                                                                                                                                                  |   |                              | 26     |   |                              |   | 26      |                              |   |   | 86                                |   |   |   | 79 |   |
|                Total interest                and dividend income                                                                                                                                              |   |                              | 12,321 |   |                              |   | 12,408  |                              |   |   | 36,901                            |   |   |   | 35,635 |   |
|                                                                                                                                                                                                                                                                                               |   |                              |   |   |                              |   |    |                              |   |   |                              |   |   |   |   |   |
| Interest Expense                                                                                                                                                                                                                                                                              |   |                              |   |   |                              |   |    |                              |   |   |                              |   |   |   |   |   |
|      Deposits                                                                                                                                                                                                                                                             |   |                              | 2,930  |   |                              |   | 2,483   |                              |   |   | 8,920                             |   |   |   | 6,326 |   |
|      Other borrowings                                                                                                                                                                                                                                                |   |                              | 81     |   |                              |   | 68      |                              |   |   | 247                               |   |   |   | 284 |   |
|                Total interest expense                                                                                                                                                                         |   |                              | 3,011  |   |                              |   | 2,551   |                              |   |   | 9,167                             |   |   |   | 6,610 |   |
|                Net interest income                                                                                                                                                                            |   |                              | 9,310  |   |                              |   | 9,857   |                              |   |   | 27,734                            |   |   |   | 29,025 |   |
| Provision                for  loan losses                                                                                                                                                                                                                                           |   |                              | 990    |   |                              |   | 810     |                              |   |   | 1,250                             |   |   |   | 585 |   |
|                                                                                                                                                                                                                                                                                               |   |                              |   |   |                              |   |    |                              |   |   |                              |   |   |   |   |   |
|                Net interest income after provision                    for loan losses |   |                              | 8,320  |   |                              |   | 9,047   |                              |   |   | 26,484                            |   |   |   | 28,440 |   |
|                                                                                                                                                                                                                                                                                               |   |                              |   |   |                              |   |    |                              |   |   |                              |   |   |   |   |   |
| Other operating income                                                                                                                                                                                                                                                                   |   |                              |   |   |                              |   |    |                              |   |   |                              |   |   |   |   |   |
|      Service charges on deposit accounts                                                                                                                                                                                                              |   |                              | 903    |   |                              |   | 749     |                              |   |   | 2,512                             |   |   |   | 2,050 |   |
|      Gains                on sales of other real estate owned                                                                                                                                                                                              |   |                              | 174    |   |                              |   | — |                              |   |   | 353                               |   |   |   | 6 |   |
|      Gains on sales of loans                held-for-sale                                                                                                                                                                                             |   |                              | 6      |   |                              |   | 100     |                              |   |   | 190                               |   |   |   | 192 |   |
|      Investment and brokerage services income                                                                                                                                                                                                         |   |                              | 37     |   |                              |   | 61      |                              |   |   | 141                               |   |   |   | 173 |   |
|      Mortgage brokerage income                                                                                                                                                                                                                                  |   |                              | 13     |   |                              |   | 101     |                              |   |   | 90                                |   |   |   | 310 |   |
|      Loan servicing income                                                                                                                                                                                                                                      |   |                              | 66     |   |                              |   | 49      |                              |   |   | 232                               |   |   |   | 193 |   |
|      Fiduciary                activities income                                                                                                                                                                                                                           |   |                              | 65     |   |                              |   | 39      |                              |   |   | 210                               |   |   |   | 114 |   |
|      ATM fees                                                                                                                                                                                                                                                        |   |                              | 77     |   |                              |   | 70      |                              |   |   | 216                               |   |   |   | 203 |   |
|      Signature                based transaction fees                                                                                                                                                                                                                      |   |                              | 134    |   |                              |   | 102     |                              |   |   | 377                               |   |   |   | 272 |   |
|      Gains                on available for sale securities                                                                                                                                                                                                                |   |                              | 146    |   |                              |   | — |                              |   |   | 146                               |   |   |   | — |   |
|      Other income                                                                                                                                                                                                                                                    |   |                              | 179    |   |                              |   | 175     |                              |   |   | 539                               |   |   |   | 505 |   |
|                Total other operating income                                                                                                                                                              |   |                              | 1,800  |   |                              |   | 1,446   |                              |   |   | 5,006                             |   |   |   | 4,018 |   |
|                                                                                                                                                                                                                                                                                               |   |                              |   |   |                              |   |    |                              |   |   |                              |   |   |   |   |   |
| Other operating expenses                                                                                                                                                                                                                                                                 |   |                              |   |   |                              |   |    |                              |   |   |                              |   |   |   |   |   |
|      Salaries and employee benefits                                                                                                                                                                                                                        |   |                              | 4,373  |   |                              |   | 4,347   |                              |   |   | 13,183                            |   |   |   | 13,237 |   |
|      Occupancy and equipment                                                                                                                                                                                                                                    |   |                              | 834    |   |                              |   | 983     |                              |   |   | 2,731                             |   |   |   | 2,723 |   |
|      Data processing                                                                                                                                                                                                                                                 |   |                              | 424    |   |                              |   | 368     |                              |   |   | 1,217                             |   |   |   | 1,082 |   |
|      Stationery and supplies                                                                                                                                                                                                                                    |   |                              | 119    |   |                              |   | 135     |                              |   |   | 406                               |   |   |   | 375 |   |
|      Advertising                                                                                                                                                                                                                                                          |   |                              | 212    |   |                              |   | 162     |                              |   |   | 641                               |   |   |   | 611 |   |
|      Directors’ fees                                                                                                                                                                                                                                           |   |                              | 49     |   |                              |   | 42      |                              |   |   | 149                               |   |   |   | 108 |   |
|      Other                real estate owned expense                                                                                                                                                                                                                       |   |                              | 9      |   |                              |   | — |                              |   |   | 27                                |   |   |   | — |   |
|      Other expense                                                                                                                                                                                                                                                   |   |                              | 1,170  |   |                              |   | 1,213   |                              |   |   | 3,909                             |   |   |   | 3,582 |   |
|                Total other operating expenses                                                                                                                                                            |   |                              | 7,190  |   |                              |   | 7,250   |                              |   |   | 22,263                            |   |   |   | 21,718 |   |
|                                                                                                                                                                                                                                                                                               |   |                              |   |   |                              |   |    |                              |   |   |                              |   |   |   |   |   |
|                Income before income tax expense                                                                                                                                                     |   |                              | 2,930  |   |                              |   | 3,243   |                              |   |   | 9,227                             |   |   |   | 10,740 |   |
| Provision for income taxes                                                                                                                                                                                                                                                          |   |                              | 911    |   |                              |   | 1,195   |                              |   |   | 3,133                             |   |   |   | 3,996 |   |
|                                                                                                                                                                                                                                                                                               |   |                              |   |   |                              |   |    |                              |   |   |                              |   |   |   |   |   |
|                Net income                                                                                                                                                                                          |   | $                                 | 2,019  |   |                              | $      | 2,048   |                              |   | $      | 6,094                             |   |   | $ | 6,744 |   |
|                                                                                                                                                                                                                                                                                               |   |                              |   |   |                              |   |    |                              |   |   |                              |   |   |   |   |   |
| Basic Income per share                                                                                                                                                                                                                                                         |   | $                                 | 0.24   |   |                              | $      | 0.24    |                              |   | $      | 0.73                              |   |   | $ | 0.80 |   |
| Diluted Income per share                                                                                                                                                                                                                                                            |   | $                                 | 0.24   |   |                              | $      | 0.23    |                              |   | $      | 0.71                              |   |   | $ | 0.77 |   |

----

***UNAUDITED      CONDENSED CONSOLIDATED STATEMENT***

*** OF      STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME***

| (in                thousands, except share amounts)                                                                                               |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                              |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Accumulated |   |   |   |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Other |   |   |   |   |
|                                                                                                                                              |   | Common                Stock |   |   | Comprehensive |   |   | Paid-in |   |   | Retained |   |   | Comprehensive |   |   |   |   |
|                                                                                                                                              |   | Shares |   |   | Amounts |   |   | Income |   |   | Capital |   |   | Earnings |   |   | Loss |   |   | Total |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at December 31, 2006                                                                                                       |   |   | 7,980,952 |   |   | $ | 45,726 |   |   |   |   |   | $ | 977 |   |   | $ | 15,792 |   |   | $ | (505 | ) |   | $ | 61,990 |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Comprehensive                income:                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                income                                                                                                                         |   |   |   |   |   |   |   |   |   | $ | 6,094 |   |   |   |   |   |   |   | 6,094 |   |   |   |   |   |   |   | 6,094 |   |
| Other                comprehensive loss:                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unrealized                holding losses on securities arising during the current period, net                of tax                effect of $109 |   |   |   |   |   |   |   |   |   |   | (164 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Reclassification                adjustment due to gains realized on sales of securities, net of tax                effect                of $58   |   |   |   |   |   |   |   |   |   |   | 88 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                other comprehensive loss, net of tax effect of $51                                                                           |   |   |   |   |   |   |   |   |   |   | (76 | ) |   |   |   |   |   |   |   |   |   |   | (76 | ) |   |   | (76 | ) |
|                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Comprehensive                income                                                                                                               |   |   |   |   |   |   |   |   |   | $ | 6,018 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 6%                stock dividend                                                                                                                  |   |   | 476,532 |   |   |   | 10,851 |   |   |   |   |   |   |   |   |   |   |   | (10,851 | ) |   |   |   |   |   |   | — |   |
| Cash                in lieu of fractional shares                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (13 | ) |   |   |   |   |   |   | (13 | ) |
| Stock-based                compensation and related tax benefits                                                                                  |   |   |   |   |   |   | 508 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 508 |   |
| Stock                options exercised, net of swapped shares                                                                                     |   |   | 34,136 |   |   |   | 101 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 101 |   |
| Stock                repurchase and retirement                                                                                                    |   |   | (240,792 | ) |   |   | (4,542 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (4,542 | ) |
|                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at September 30, 2007                                                                                                      |   |   | 8,250,828 |   |   | $ | 52,644 |   |   |   |   |   |   | $ | 977 |   |   | $ | 11,022 |   |   | $ | (581 | ) |   | $ | 64,062 |   |

|                                                |   |                       |   |   |       |   |   |                      |   |
|-----------------------------------------------------|--------|----------------------------|--------|--------|------------|--------|--------|---------------------------|--------|
|                                                |   | As                Reported |   |   | Misapplied |   |   | As                Revised |   |
|                                                |   |                       |   |   |       |   |   |                      |   |
| Other                Comprehensive Loss, Net of Tax |   | $                          | (624   | )      |       | $      | (512   | )                         |   | $ | (112 | ) |
|                                                |   |                       |   |   |       |   |   |                      |   |   |   |   |
| Comprehensive                income                 |   | $                          | 8,186  |   |       | $      | (512   | )                         |   | $ | 8,698 |   |
|                                                |   |                       |   |   |       |   |   |                      |   |   |   |   |

----

***UNAUDITED      CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS***

|                                                                                                                                                                                                      |   | (in                thousands)                                  |    |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------|---------|
|                                                                                                                                                                                                      |   | Nine                months ended  September 30, 2007 |    |   | Nine                months ended September 30, 2006 |   |
| **Operating                Activities**                                                                                                                                                                   |   |                                                           |    |   |   |   |
|           Net Income                                                                                                                               |   | $                                                              | 6,094   |   |   | $ | 6,744 |   |
|           Adjustments to reconcile net income to net                cash                                                  |   |                                                           |    |   |   |   |   |   |
|  provided by operating activities:                                                                                                                                                    |   |                                                           |    |   |   |   |   |   |
|  Depreciation                                                                                                                                                                                        |   |                                                           | 853     |   |   |   | 780 |   |
|  Provision                for loan losses                                                                                                                                                            |   |                                                           | 1,250   |   |   |   | 585 |   |
|  Stock                plan accruals                                                                                                                                                                  |   |                                                           | 426     |   |   |   | 292 |   |
|  Tax                benefit for stock options                                                                                                                                                        |   |                                                           | 82      |   |   |   | 307 |   |
|  Gains                on available for sale securities                                                                                                                                               |   |                                                           | (146    | ) |   |   | — |   |
|  Gains                on sales of other real estate owned                                                                                                                                            |   |                                                           | (353    | ) |   |   | (6 | ) |
|  Gains                on sales of loans held-for-sale                                                                                                                                                |   |                                                           | (190    | ) |   |   | (192 | ) |
|  Proceeds                from sales of loans held-for-sale                                                                                                                                           |   |                                                           | 33,447  |   |   |   | 28,897 |   |
|  Originations                of loans held-for-sale                                                                                                                                                  |   |                                                           | (30,415 | ) |   |   | (28,894 | ) |
|  Increase                in accrued interest receivable and other assets                                                                                                                             |   |                                                           | (959    | ) |   |   | (1,956 | ) |
|  Decrease                in accrued interest payable and other liabilities                                                                                                                           |   |                                                           | (799    | ) |   |   | (171 | ) |
|                     Net cash                provided by operating activities      |   |                                                           | 9,290   |   |   |   | 6,386 |   |
|                                                                                                                                                                                                      |   |                                                           |    |   |   |   |   |   |
| **Investing Activities**                                                                                                                                                                             |   |                                                           |    |   |   |   |   |   |
|           Net increase in investment securities                                                                                     |   |                                                           | (15,000 | ) |   |   | (21,532 | ) |
|           Net increase in loans                                                                                                          |   |                                                           | (34,443 | ) |   |   | (30,299 | ) |
|           Net                (increase) decrease in other interest earning assets                                                                  |   |                                                           | (79     | ) |   |   | 16 |   |
|           Net                decrease in other real estate owned                                                                                   |   |                                                           | 476     |   |   |   | 274 |   |
|           Purchases of premises and equipment, net                                                                             |   |                                                           | (722    | ) |   |   | (562 | ) |
|                     Net cash                used in investing activities          |   |                                                           | (49,768 | ) |   |   | (52,103 | ) |
|                                                                                                                                                                                                      |   |                                                           |    |   |   |   |   |   |
| **Financing Activities**                                                                                                                                                                             |   |                                                           |    |   |   |   |   |   |
|           Net                increase (decrease) in deposits                                                                                  |   |                                                           | 4,138   |   |   |   | (4,362 | ) |
|           Net decrease in FHLB advances                and other borrowings                                                         |   |                                                           | (303    | ) |   |   | (4,091 | ) |
|           Cash dividends paid                                                                                                                 |   |                                                           | (13     | ) |   |   | (15 | ) |
|           Stock                options exercised                                                                                                        |   |                                                           | 101     |   |   |   | 138 |   |
|           Tax                benefit for stock options                                                                                                  |   |                                                           | (82     | ) |   |   | (307 | ) |
|           Repurchase of stock                                                                                                                 |   |                                                           | (4,542  | ) |   |   | (3,437 | ) |
|                     Net cash used                in financing activities               |   |                                                           | (701    | ) |   |   | (12,074 | ) |
|                                                                                                                                                                                            |   |                                                           |    |   |   |   |   |   |
|                     Net decrease                in cash and cash equivalents |   |                                                           | (41,179 | ) |   |   | (57,791 | ) |
| Cash and cash equivalents at beginning of period                                                                                                                       |   |                                                           | 98,001  |   |   |   | 122,692 |   |
| Cash and cash equivalents at end of period                                                                                                                             |   | $                                                              | 56,822  |   |   | $ | 64,901 |   |
|                                                                                                                                                                                                      |   |                                                           |    |   |   |   |   |   |
| Supplemental disclosures of cash flow information:                                                                                                                               |   |                                                           |    |   |   |   |   |   |
| Cash paid during the period for:                                                                                                                                                 |   |                                                           |    |   |   |   |   |   |
|                     Interest                                                                          |   | $                                                              | 9,188   |   |   | $ | 6,524 |   |
|                     Income Taxes                                                                 |   | $                                                              | 3,322   |   |   | $ | 4,615 |   |
|                                                                                                                                                                                                      |   |                                                           |    |   |   |   |   |   |
| Supplemental disclosures of non-cash investing and financing activities:                                                                                               |   |                                                           |    |   |   |   |   |   |
| Transfer                of loans held-for-sale to loans held-for-investment                                                                                                                               |   | $                                                              | 2,892   |   |   |   | — |   |
| Stock dividend distributed                                                                                                                                                                      |   | $                                                              | 10,851  |   |   | $ | 12,525 |   |

----

*NOTES      TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS*

| 1. | BASIS                OF PRESENTATION |
|----|--------------------------------------|

*Recently      Issued Accounting Pronouncements:*

----

*Reclassifications*

----

|                                        |   | (in                thousands)                                |   |
|---------------------------------------------|--------|--------------------------------------------------------------|--------|
|                                        |   |                                                         |   |   |   |   |
|                                        |   | Nine                months endedSeptember                30, |   |   | Year                ended December 31, |   |
|                                        |   | 2007                                                         |   |   | 2006 |   |   | 2006 |   |
| Balance,                beginning of period |   | $                                                            | 8,361  |   |   | $ | 7,917 |   |   | $ | 7,917 |   |
| Provision                for loan losses    |   |                                                         | 1,250  |   |   |   | 585 |   |   |   | 735 |   |
| Loan                charge-offs             |   |                                                         | (970   | ) |   |   | (717 | ) |   |   | (1,060 | ) |
| Loan                recoveries              |   |                                                         | 512    |   |   |   | 615 |   |   |   | 769 |   |
| Balance,                end of period       |   | $                                                            | 9,153  |   |   | $ | 8,400 |   |   | $ | 8,361 |   |

----

| 3. | MORTGAGE                OPERATIONS |
|----|------------------------------------|

|                                     |   | (in                thousands)    |   |
|------------------------------------------|--------|----------------------------------|--------|
|                                     |   | December                31, 2006 |   |   | Additions |   |   | Reductions |   |   | September                30, 2007 |   |
|                                     |   |                             |   |   |   |   |   |   |   |   |   |   |
| Mortgage                servicing rights |   | $                                | 945    |   |   | $ | 129 |   |   | $ | 112 |   |   | $ | 962 |   |

----

| 4. | OUTSTANDING                SHARES AND EARNINGS PER SHARE |
|----|----------------------------------------------------------|

|                                                               |   | (in                thousands, except share and earnings per share amounts) |      |
|--------------------------------------------------------------------|--------|----------------------------------------------------------------------------|-----------|
|                                                               |   | Three                months ended September 30,                            |      |   | Nine                months ended September 30, |   |
|                                                               |   | 2007                                                                       |      |   | 2006 |   |   | 2007 |   |   | 2006 |   |
| Basic                earnings per share:                           |   |                                                                       |      |   |   |   |   |   |   |   |   |   |
| Net                income                                          |   | $                                                                          | 2,019     |   |   | $ | 2,048 |   |   | $ | 6,094 |   |   | $ | 6,744 |   |
|                                                               |   |                                                                       |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted                average common shares outstanding          |   |                                                                       | 8,306,870 |   |   |   | 8,454,806 |   |   |   | 8,374,380 |   |   |   | 8,475,454 |   |
| Basic                EPS                                           |   | $                                                                          | 0.24      |   |   | $ | 0.24 |   |   | $ | 0.73 |   |   | $ | 0.80 |   |
|                                                               |   |                                                                       |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Diluted                earnings per share:                         |   |                                                                       |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                income                                          |   | $                                                                          | 2,019     |   |   | $ | 2,048 |   |   | $ | 6,094 |   |   | $ | 6,744 |   |
|                                                               |   |                                                                       |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted                average common shares outstanding          |   |                                                                       | 8,306,870 |   |   |   | 8,454,806 |   |   |   | 8,374,380 |   |   |   | 8,475,454 |   |
|                                                               |   |                                                                       |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Effect                of dilutive options                          |   |                                                                       | 207,206   |   |   |   | 278,327 |   |   |   | 245,452 |   |   |   | 305,732 |   |
|                                                               |   |                                                                       |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Adjusted                weighted average common shares outstanding |   |                                                                       | 8,514,076 |   |   |   | 8,733,133 |   |   |   | 8,619,832 |   |   |   | 8,781,186 |   |
| Diluted                EPS                                         |   | $                                                                          | 0.24      |   |   | $ | 0.23 |   |   | $ | 0.71 |   |   | $ | 0.77 |   |

----

| 5. | STOCK                PLANS |
|----|----------------------------|

|                                                                 |   | Number                of Shares |    |   | Weighted                Average Exercise Price |   |    | Aggregate                Intrinsic Value |   |   | Weighted                Average Remaining Contractual Term |   |
|----------------------------------------------------------------------|--------|---------------------------------|---------|--------|------------------------------------------------|--------|---------|------------------------------------------|--------|--------|------------------------------------------------------------|--------|
| Options                outstanding at Beginning of  Period |   |                            | 555,063 |   |                                           | $      | 11.14   |                                     |   |   |                                                       |   |   |   |
|                                                                 |   |                            |    |   |                                           |   |    |                                     |   |   |                                                       |   |   |   |
|    Granted                                            |   |                            | — |   |                                           |   | — |                                     |   |   |                                                       |   |   |   |
|                                                                 |   |                            |    |   |                                           |   |    |                                     |   |   |                                                       |   |   |   |
|    Cancelled                / Forfeited               |   |                            | — |   |                                           |   | — |                                     |   |   |                                                       |   |   |   |
|                                                                 |   |                            |    |   |                                           |   |    |                                     |   |   |                                                       |   |   |   |
|    Exercised                                          |   |                            | (3,339  | )      |                                           | $      | 4.03    |                                     |   | $      | 47,153                                                     |   |   |   |   |
|                                                                 |   |                            |    |   |                                           |   |    |                                     |   |   |                                                       |   |   |   |   |
| Options                outstanding at End of Period                  |   |                            | 551,724 |   |                                           | $      | 11.18   |                                     |   | $      | 4,499,070                                                  |   |   |   | 5.61 |   |
|                                                                 |   |                            |    |   |                                           |   |    |                                     |   |   |                                                       |   |   |   |   |   |
| Exercisable                (vested) at End of Period                 |   |                            | 391,488 |   |                                           | $      | 8.81    |                                     |   | $      | 3,897,935                                                  |   |   |   | 4.61 |   |

|                                                                 |   | Number                of Shares |    |   | Weighted                Average Exercise Price |   |    | Aggregate                Intrinsic Value |   |   | Weighted                Average Remaining Contractual Term |   |
|----------------------------------------------------------------------|--------|---------------------------------|---------|--------|------------------------------------------------|--------|---------|------------------------------------------|--------|--------|------------------------------------------------------------|--------|
| Options                outstanding at Beginning of  Period |   |                            | 549,000 |   |                                           | $      | 10.32   |                                     |   |   |                                                       |   |   |   |
|                                                                 |   |                            |    |   |                                           |   |    |                                     |   |   |                                                       |   |   |   |
|    Granted                                            |   |                            | 49,924  |   |                                           |   | 16.75   |                                     |   |   |                                                       |   |   |   |
|                                                                 |   |                            |    |   |                                           |   |    |                                     |   |   |                                                       |   |   |   |
|    Cancelled                / Forfeited               |   |                            | — |   |                                           |   | — |                                     |   |   |                                                       |   |   |   |
|                                                                 |   |                            |    |   |                                           |   |    |                                     |   |   |                                                       |   |   |   |
|    Exercised                                          |   |                            | (47,200 | )      |                                           | $      | 7.05    |                                     |   | $      | 565,558                                                    |   |   |   |   |
|                                                                 |   |                            |    |   |                                           |   |    |                                     |   |   |                                                       |   |   |   |   |
| Options                outstanding at End of Period                  |   |                            | 551,724 |   |                                           | $      | 11.18   |                                     |   | $      | 4,499,070                                                  |   |   |   | 5.61 |   |
|                                                                 |   |                            |    |   |                                           |   |    |                                     |   |   |                                                       |   |   |   |   |   |
| Exercisable                (vested) at End of Period                 |   |                            | 391,488 |   |                                           | $      | 8.81    |                                     |   | $      | 3,897,935                                                  |   |   |   | 4.61 |   |

----

|                                           |   | Three                Months Ended  |    |   | Nine                Months Ended  |   |
|------------------------------------------------|--------|------------------------------------|---------|--------|-----------------------------------|--------|
|                                           |   | September                30, 2007* |    |   | September                30, 2007 |   |
|  Risk                Free Interest Rate   |   |                               | — |   |                              |   | 4.67 | % |
|                                           |   |                               |    |   |                              |   |   |   |
|  Expected                Dividend Yield   |   |                               | — |   |                              |   | 0.0 | % |
|                                           |   |                               |    |   |                              |   |   |   |
|  Expected                Life in Years    |   |                               | — |   |                              |   | 4.18 |   |
|                                           |   |                               |    |   |                              |   |   |   |
|  Expected                Price Volatility |   |                               | — |   |                              |   | 26.03 | % |

----

|                                           |   | Three                Months Ended |   |   | Nine                Months Ended  |   |
|------------------------------------------------|--------|-----------------------------------|--------|--------|-----------------------------------|--------|
|                                           |   | September                30, 2007 |   |   | September                30, 2007 |   |
|  Risk                Free Interest Rate   |   |                              | 5.00   | %      |                              |   | 5.00 | % |
|                                           |   |                              |   |   |                              |   |   |   |
|  Expected                Dividend Yield   |   |                              | 0.00   | %      |                              |   | 0.00 | % |
|                                           |   |                              |   |   |                              |   |   |   |
|  Expected                Life in Years    |   |                              | 1.00   |   |                              |   | 1.00 |   |
|                                           |   |                              |   |   |                              |   |   |   |
|  Expected                Price Volatility |   |                              | 22.97  | %      |                              |   | 22.97 | % |

----

| 6. | FIRST                NORTHERN BANK – EXECUTIVE SALARY CONTINUATION                PLAN |
|----|----------------------------------------------------------------------------------------------|

|                                                   |   | Three                months ended September 30, |   |
|--------------------------------------------------------|--------|-------------------------------------------------|--------|
|                                                   |   | 2007                                            |   |   | 2006 |   |
| Components                of Net Periodic Benefit Cost |   |                                            |   |   |   |   |
| Service                Cost                            |   | $                                               | 30,383 |   |   | $ | 41,146 |   |
| Interest  Cost                               |   |                                            | 28,784 |   |   |   | 16,155 |   |
| Amortization                of prior service cost      |   |                                            | 21,821 |   |   |   | 3,257 |   |
| Net                periodic benefit cost               |   | $                                               | 80,988 |   |   | $ | 60,558 |   |

----

| 7.   | FIRST                NORTHERN BANK – DIRECTORS’ RETIREMENT                PLAN |
|----------------|--------------------------------------------------------------------------------------------|

|                                                   |   | Three                months ended September 30, |   |
|--------------------------------------------------------|--------|-------------------------------------------------|--------|
|                                                   |   | 2007                                            |   |   | 2006 |   |
| Components                of Net Periodic Benefit Cost |   |                                            |   |   |   |   |
| Service                Cost                            |   | $                                               | 14,366 |   |   | $ | 13,518 |   |
| Interest  Cost                               |   |                                            | 6,736  |   |   |   | 5,943 |   |
| Amortization                of net loss                |   |                                            | 121    |   |   |   | 234 |   |
| Net                periodic benefit cost               |   | $                                               | 21,223 |   |   | $ | 19,695 |   |

----

**ITEM      2. **

**MANAGEMENT’S      DISCUSSION AND ANALYSIS OF**

**FINANCIAL      CONDITION AND RESULTS OF OPERATIONS**

**FORWARD-LOOKING      STATEMENTS**

----

**INTRODUCTION**

----

**SUMMARY**

|   |   |   |                                                                                                | (in                thousands, except earnings per share and percentage                amounts) |
|--------|--------|--------|-----------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------|
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |
|   | .      |   |                                                                                                |                                                                                           | Three                months |   |   | Three                months |   |   | Nine                months |   |   | Nine                months |
|   |   |   |                                                                                                |                                                                                           | ended |   |   | ended |   |   | ended |   |   | ended |   |
|   |   |   |                                                                                                |                                                                                           | September                30, 2007 |   |   | September                30, 2006 |   |   | September                30, 2007 |   |   | September                30, 2006 |   |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   | For                the Period:                                                                      |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |     Net                Income                                                   |                                                                                           | $ | 2,019 |   |   | $ |  2,048 |   |   | $ | 6,094 |   |   | $ | 6,744 |   |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |     Basic                Earnings Per Share*                                    |                                                                                           | $ | 0.24 |   |   | $ | 0.24 |   |   | $ | 0.73 |   |   | $ | 0.80 |   |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |     Diluted                Earnings Per share*                                  |                                                                                           | $ | 0.24 |   |   | $ | 0.23 |   |   | $ | 0.71 |   |   | $ | 0.77 |   |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |     Return                on Average Assets                                     |                                                                                           |   | 1.16 | % |   |   | 1.25 | % |   |   | 1.18 | % |   |   | 1.36 | % |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |     Net                Income / Beginning Equity                                |                                                                                           |   | 13.03 | % |   |   | 14.42 | % |   |   | 13.11 | % |   |   | 15.83 | % |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   | At                Period End:                                                                       |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |       Total                Assets                                     |                                                                                           | $ | 690,333 |   |   | $ | 655,817 |   |   | $ | 690,333 |   |   | $ | 655,817 |   |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |       Total                Loans, Net (including loans held-for-sale) |                                                                                           | $ | 510,360 |   |   | $ | 490,404 |   |   | $ | 510,360 |   |   | $ | 490,404 |   |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |      Total                Investment Securities                            |                                                                                           | $ | 89,377 |   |   | $ | 70,461 |   |   | $ | 89,377 |   |   | $ | 70,461 |   |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |      Total                Deposits                                         |                                                                                           | $ | 607,820 |   |   | $ | 577,419 |   |   | $ | 607,820 |   |   | $ | 577,419 |   |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   |       Loan-To-Deposit                Ratio                            |                                                                                           |   | 84.0 | % |   |   | 84.9 | % |   |   | 84.0 | % |   |   | 84.9% | % |
|   |   |   |                                                                                                |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   |   |   | *Adjusted                for stock dividends                                                        |                                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |

----

**Distribution      of Average Statements of Condition and Analysis of Net Interest      Income**

|                                                                                                                                                                                                                                                          |   | Three                months ended |    |   | Three                months ended |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|---------|--------|-----------------------------------|--------|
|                                                                                                                                                                                                                                                          |   | September                30, 2007 |    |   | September                30, 2006 |   |
|                                                                                                                                                                                                                                                          |   | Average                           |    |   |                              |   |   | Yield/ |   |   | Average |   |   |   |   |   | Yield/ |   |
|                                                                                                                                                                                                                                                          |   | Balance                           |    |   | Interest                          |   |   | Rate |   |   | Balance |   |   | Interest |   |   | Rate |   |
| **Assets**                                                                                                                                                                                                                                                    |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-earning                assets:                                                                                                                                                                                                                       |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans                (1)                                                                                                                                                                                                                                      |   | $                                 | 501,560 |   |                              | $      | 10,681 |   |   |   | 8.45 | % |   | $ | 489,094 |   |   | $ | 11,070 |   |   |   | 8.98 | % |
| Federal                funds sold                                                                                                                                                                                                                             |   |                              | 29,187  |   |                              |   | 384 |   |   |   | 5.22 | % |   |   | 37,982 |   |   |   | 506 |   |   |   | 5.29 | % |
| Interest                bearing due from banks                                                                                                                                                                                                                |   |                              | 7,532   |   |                              |   | 116 |   |   |   | 6.11 | % |   |   | — |   |   |   | — |   |   |   | — |   |
| Investment                securities, taxable                                                                                                                                                                                                                 |   |                              | 61,819  |   |                              |   | 779 |   |   |   | 5.00 | % |   |   | 53,816 |   |   |   | 644 |   |   |   | 4.75 | % |
| Investment                securities, non-taxable  (2)                                                                                                                                                                                              |   |                              | 31,061  |   |                              |   | 335 |   |   |   | 4.28 | % |   |   | 14,098 |   |   |   | 162 |   |   |   | 4.56 | % |
| Other                interest earning assets                                                                                                                                                                                                                  |   |                              | 2,159   |   |                              |   | 26 |   |   |   | 4.78 | % |   |   | 2,054 |   |   |   | 26 |   |   |   | 5.02 | % |
| Total                interest-earning assets                                                                                                                                                                                                                  |   |                              | 633,318 |   |                              |   | 12,321 |   |   |   | 7.72 | % |   |   | 597,044 |   |   |   | 12,408 |   |   |   | 8.25 | % |
| Non-interest-earning                assets:                                                                                                                                                                                                                   |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                and due from banks                                                                                                                                                                                                                        |   |                              | 28,348  |   |                              |   |   |   |   |   |   |   |   |   | 29,401 |   |   |   |   |   |   |   |   |   |
| Premises                and equipment, net                                                                                                                                                                                                                    |   |                              | 8,068   |   |                              |   |   |   |   |   |   |   |   |   | 8,147 |   |   |   |   |   |   |   |   |   |
| Other                real estate owned                                                                                                                                                                                                                        |   |                              | 56      |   |                              |   |   |   |   |   |   |   |   |   | — |   |   |   |   |   |   |   |   |   |
| Accrued                interest receivable and other assets                                                                                                                                                                                                   |   |                              | 22,540  |   |                              |   |   |   |   |   |   |   |   |   | 21,217 |   |   |   |   |   |   |   |   |   |
| Total                average assets                                                                                                                                                                                                                           |   |                              | 693,330 |   |                              |   |   |   |   |   |   |   |   |   | 655,809 |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                          |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Liabilities                and Stockholders’ Equity:**                                                                                                                                                                                                |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing                liabilities:                                                                                                                                                                                                                  |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing                transaction deposits                                                                                                                                                                                                          |   |                              | 135,061 |   |                              |   | 772 |   |   |   | 2.27 | % |   |   | 96,590 |   |   |   | 473 |   |   |   | 1.94 | % |
| Savings                and MMDA’s                                                                                                                                                                                                                       |   |                              | 174,348 |   |                              |   | 1,003 |   |   |   | 2.28 | % |   |   | 187,583 |   |   |   | 1,046 |   |   |   | 2.21 | % |
| Time,                under $100,000                                                                                                                                                                                                                           |   |                              | 45,394  |   |                              |   | 384 |   |   |   | 3.36 | % |   |   | 49,301 |   |   |   | 356 |   |   |   | 2.86 | % |
| Time,                $100,000 and over                                                                                                                                                                                                                        |   |                              | 70,468  |   |                              |   | 772 |   |   |   | 4.35 | % |   |   | 66,196 |   |   |   | 608 |   |   |   | 3.64 | % |
| FHLB                advances and other borrowings                                                                                                                                                                                                             |   |                              | 10,626  |   |                              |   | 80 |   |   |   | 2.99 | % |   |   | 10,601 |   |   |   | 68 |   |   |   | 2.54 | % |
| Total                interest-bearing liabilities                                                                                                                                                                                                             |   |                              | 435,897 |   |                              |   | 3,011 |   |   |   | 2.74 | % |   |   | 410,271 |   |   |   | 2,551 |   |   |   | 2.47 | % |
| Non-interest-bearing                liabilities:                                                                                                                                                                                                              |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Non-interest-bearing                demand deposits                                                                                                                                                                                                           |   |                              | 186,703 |   |                              |   |   |   |   |   |   |   |   |   | 179,716 |   |   |   |   |   |   |   |   |   |
| Accrued                interest payable and other liabilities                                                                                                                                                                                                 |   |                              | 7,591   |   |                              |   |   |   |   |   |   |   |   |   | 6,226 |   |   |   |   |   |   |   |   |   |
| Total                liabilities                                                                                                                                                                                                                              |   |                              | 630,191 |   |                              |   |   |   |   |   |   |   |   |   | 596,213 |   |   |   |   |   |   |   |   |   |
| Total                stockholders’ equity                                                                                                                                                                                                               |   |                              | 63,139  |   |                              |   |   |   |   |   |   |   |   |   | 59,596 |   |   |   |   |   |   |   |   |   |
| Total                average liabilities and stockholders’ equity                                                                                                                                                                                       |   | $                                 | 693,330 |   |                              |   |   |   |   |   |   |   |   | $ | 655,809 |   |   |   |   |   |   |   |   |   |
| Net                interest income and net interest margin (3)                                                                                                                                                                                                |   |                              |    |   |                              | $      | 9,310 |   |   |   | 5.83 | % |   |   |   |   |   | $ | 9,857 |   |   |   | 6.55 | % |
|                                                                                                                                                                                                                                                     |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 1.   Average                balances                for loans include loans held-for-sale and non-accrual loans and are                net of                the allowance for loan losses, but non-accrued interest thereon                is |   |
|    excluded. Loan                interest income includes loan fees of approximately $521 and $741                for the                three months ended September 30, 2007 and 2006,                respectively.                     |   |
|                                                                                                                                                                                                                                                          |   |
| 2.  Interest                income and                yields on tax-exempt securities are not presented on a taxable equivalent                basis.                                                                                          |   |
| 3.   Net                interest margin                is computed by dividing net interest income by total average                interest-earning assets.                                                                                    |   |

----

**Distribution      of Average Statements of Condition and Analysis of Net Interest      Income**

|                                                                                                                                                                                                                                                           |   | Nine                months ended  |    |   | Nine                months ended  |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|---------|--------|-----------------------------------|--------|
|                                                                                                                                                                                                                                                           |   | September                30, 2007 |    |   | September                30, 2006 |   |
|                                                                                                                                                                                                                                                           |   | Average                           |    |   |                              |   |   | Yield/ |   |   | Average |   |   |   |   |   | Yield/ |   |
|                                                                                                                                                                                                                                                           |   | Balance                           |    |   | Interest                          |   |   | Rate |   |   | Balance |   |   | Interest |   |   | Rate |   |
| **Assets**                                                                                                                                                                                                                                                     |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-earning                assets:                                                                                                                                                                                                                        |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans                (1)                                                                                                                                                                                                                                       |   | $                                 | 485,664 |   |                              | $      | 31,435 |   |   |   | 8.65 | % |   | $ | 477,398 |   |   | $ | 31,189 |   |   |   | 8.73 | % |
| Federal                funds sold                                                                                                                                                                                                                              |   |                              | 57,295  |   |                              |   | 2,236 |   |   |   | 5.22 | % |   |   | 60,197 |   |   |   | 2,117 |   |   |   | 4.70 | % |
| Interest                bearing due from banks                                                                                                                                                                                                                 |   |                              | 2,538   |   |                              |   | 116 |   |   |   | 6.11 | % |   |   | — |   |   |   | — |   |   |   |   |   |
| Investment                securities, taxable                                                                                                                                                                                                                  |   |                              | 56,928  |   |                              |   | 2,113 |   |   |   | 4.96 | % |   |   | 50,335 |   |   |   | 1,814 |   |   |   | 4.82 | % |
| Investment                securities, non-taxable  (2)                                                                                                                                                                                               |   |                              | 28,320  |   |                              |   | 915 |   |   |   | 4.32 | % |   |   | 12,402 |   |   |   | 436 |   |   |   | 4.70 | % |
| Other                interest earning assets                                                                                                                                                                                                                   |   |                              | 2,133   |   |                              |   | 86 |   |   |   | 5.39 | % |   |   | 2,088 |   |   |   | 79 |   |   |   | 5.06 | % |
| Total                interest-earning assets                                                                                                                                                                                                                   |   |                              | 632,878 |   |                              |   | 36,901 |   |   |   | 7.80 | % |   |   | 602,420 |   |   |   | 35,635 |   |   |   | 7.91 | % |
| Non-interest-earning                assets:                                                                                                                                                                                                                    |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                and due from banks                                                                                                                                                                                                                         |   |                              | 26,639  |   |                              |   |   |   |   |   |   |   |   |   | 30,189 |   |   |   |   |   |   |   |   |   |
| Premises                and equipment, net                                                                                                                                                                                                                     |   |                              | 8,174   |   |                              |   |   |   |   |   |   |   |   |   | 8,193 |   |   |   |   |   |   |   |   |   |
| Other                real estate owned                                                                                                                                                                                                                         |   |                              | 891     |   |                              |   |   |   |   |   |   |   |   |   | 76 |   |   |   |   |   |   |   |   |   |
| Accrued                interest receivable and other assets                                                                                                                                                                                                    |   |                              | 22,575  |   |                              |   |   |   |   |   |   |   |   |   | 20,378 |   |   |   |   |   |   |   |   |   |
| Total                average assets                                                                                                                                                                                                                            |   |                              | 691,157 |   |                              |   |   |   |   |   |   |   |   |   | 661,256 |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                           |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Liabilities                and Stockholders’ Equity:**                                                                                                                                                                                                 |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing                liabilities:                                                                                                                                                                                                                   |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing                transaction deposits                                                                                                                                                                                                           |   |                              | 129,708 |   |                              |   | 2,286 |   |   |   | 2.36 | % |   |   | 90,003 |   |   |   | 951 |   |   |   | 1.41 | % |
| Savings                and MMDA’s                                                                                                                                                                                                                        |   |                              | 180,286 |   |                              |   | 3,225 |   |   |   | 2.39 | % |   |   | 190,990 |   |   |   | 2,704 |   |   |   | 1.89 | % |
| Time,                under $100,000                                                                                                                                                                                                                            |   |                              | 46,270  |   |                              |   | 1,148 |   |   |   | 3.32 | % |   |   | 50,434 |   |   |   | 998 |   |   |   | 2.65 | % |
| Time,                $100,000 and over                                                                                                                                                                                                                         |   |                              | 70,936  |   |                              |   | 2,261 |   |   |   | 4.26 | % |   |   | 67,756 |   |   |   | 1,673 |   |   |   | 3.30 | % |
| FHLB                advances and other borrowings                                                                                                                                                                                                              |   |                              | 10,518  |   |                              |   | 247 |   |   |   | 3.14 | % |   |   | 11,581 |   |   |   | 284 |   |   |   | 3.28 | % |
| Total                interest-bearing liabilities                                                                                                                                                                                                              |   |                              | 437,718 |   |                              |   | 9,167 |   |   |   | 2.80 | % |   |   | 410,764 |   |   |   | 6,610 |   |   |   | 2.15 | % |
| Non-interest-bearing                liabilities:                                                                                                                                                                                                               |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Non-interest-bearing                demand deposits                                                                                                                                                                                                            |   |                              | 183,662 |   |                              |   |   |   |   |   |   |   |   |   | 186,540 |   |   |   |   |   |   |   |   |   |
| Accrued                interest payable and other liabilities                                                                                                                                                                                                  |   |                              | 7,106   |   |                              |   |   |   |   |   |   |   |   |   | 5,730 |   |   |   |   |   |   |   |   |   |
| Total                liabilities                                                                                                                                                                                                                               |   |                              | 628,486 |   |                              |   |   |   |   |   |   |   |   |   | 603,034 |   |   |   |   |   |   |   |   |   |
| Total                stockholders’ equity                                                                                                                                                                                                                |   |                              | 62,671  |   |                              |   |   |   |   |   |   |   |   |   | 58,222 |   |   |   |   |   |   |   |   |   |
| Total                average liabilities and stockholders’ equity                                                                                                                                                                                        |   | $                                 | 691,157 |   |                              |   |   |   |   |   |   |   |   | $ | 661,256 |   |   |   |   |   |   |   |   |   |
| Net                interest income and net interest margin (3)                                                                                                                                                                                                 |   |                              |    |   |                              | $      | 27,734 |   |   |   | 5.86 | % |   |   |   |   |   | $ | 29,025 |   |   |   | 6.44 | % |
|                                                                                                                                                                                                                                                      |   |                              |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 1.   Average                balances                for loans include loans held-for-sale and non-accrual loans and are                net of                the allowance for loan losses, but non-accrued interest thereon                is  |   |
|                       excluded. Loan interest income includes loan fees of approximately                $1,767 and $2,171 for the nine months ended September 30, 2007 and                2006                respectively. |   |
|                                                                                                                                                                                                                                                                |   |
| 2.     Interest                income                and yields on tax-exempt securities are not presented on a taxable                equivalent basis.                                                                         |   |
| 3.     Net                interest margin is computed by dividing net interest income by total                average interest-earning assets.                                                                                        |   |

----

**CHANGES      IN FINANCIAL CONDITION**

----

**CHANGES      IN RESULTS OF OPERATIONS**

----

----

----

----

|                                                                              |   | (in                thousands)     |   |
|-----------------------------------------------------------------------------------|--------|-----------------------------------|--------|
|                                                                              |   |                              |   |
|                                                                              |   | Three                months       |   |   | Three                months |   |   | Nine                months |   |   | Nine                months |   |
|                                                                              |   | ended                             |   |   | ended |   |   | ended |   |   | ended |   |
|                                                                              |   | September                30, 2007 |   |   | September                30, 2006 |   |   | September                30, 2007 |   |   | September                30, 2006 |   |
| Other                miscellaneous operating expenses                             |   |                              |   |   |   |   |   |   |   |   |   |   |
| Provision                (recovery of provision) for unfunded lending commitments |   | $                                 | 100    |   |   | $ | (61 | ) |   | $ | 110 |   |   | $ | (61 | ) |
| Contributions                                                                     |   |                              | 15     |   |   |   | 35 |   |   |   | 110 |   |   |   | 95 |   |
| Legal                fees                                                         |   |                              | 58     |   |   |   | 71 |   |   |   | 237 |   |   |   | 214 |   |
| Accounting                and audit fees                                          |   |                              | 57     |   |   |   | 113 |   |   |   | 309 |   |   |   | 364 |   |
| Consulting                fees                                                    |   |                              | 73     |   |   |   | 188 |   |   |   | 286 |   |   |   | 418 |   |
| Postage                expense                                                    |   |                              | 87     |   |   |   | 88 |   |   |   | 264 |   |   |   | 276 |   |
| Telephone                expense                                                  |   |                              | 63     |   |   |   | 56 |   |   |   | 186 |   |   |   | 156 |   |
| Public                relations                                                   |   |                              | 90     |   |   |   | 69 |   |   |   | 291 |   |   |   | 217 |   |
| Training                expense                                                   |   |                              | 43     |   |   |   | 64 |   |   |   | 182 |   |   |   | 209 |   |
| Loan                origination expense                                           |   |                              | 87     |   |   |   | 153 |   |   |   | 486 |   |   |   | 445 |   |
| Computer                software depreciation                                     |   |                              | 60     |   |   |   | 60 |   |   |   | 171 |   |   |   | 189 |   |
| Other                miscellaneous expense                                        |   |                              | 437    |   |   |   | 377 |   |   |   | 1,277 |   |   |   | 1,060 |   |
|                                                                              |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                other miscellaneous operating expenses                       |   | $                                 | 1,170  |   |   | $ | 1,213 |   |   | $ | 3,909 |   |   | $ | 3,582 |   |
|                                                                              |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

|                                        |   | (in                thousands)     |    |
|---------------------------------------------|--------|-----------------------------------|---------|
|                                        |   |                              |    |   |   |   |
|                                        |   | September                30, 2007 |    |   | December                31, 2006 |   |
|                                        |   |                              |    |   |   |   |
| Undisbursed                loan commitments |   | $                                 | 216,063 |   |   | $ | 198,200 |   |
| Standby                letters of credit    |   |                              | 13,621  |   |   |   | 12,222 |   |
|                                        |   | $                                 | 229,684 |   |   | $ | 210,422 |   |

----

*See*

----

| Analysis                of the Allowance for Loan Losses         |   |
|------------------------------------------------------------------|--------|
| (Amounts                in thousands, except percentage amounts) |   |
|                                                             |   |   |   |   |   |   |
|                                                             |   | Nine                months endedSeptember                30, |   |   | Year                endedDecember                31, |   |
|                                                             |   | 2007 |   |   | 2006 |   |   | 2006 |   |
|                                                             |   |   |   |   |   |   |   |   |   |
| Balance                at beginning of period                    |   | $ | 8,361 |   |   | $ | 7,917 |   |   | $ | 7,917 |   |
| Provision                for loan losses                         |   |   | 1,250 |   |   |   | 585 |   |   |   | 735 |   |
| Loans                charged-off:                                |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                                                       |   |   | (201 | ) |   |   | (400 | ) |   |   | (572 | ) |
| Agriculture                                                      |   |   | — |   |   |   | — |   |   |   | (57 | ) |
| Real                estate mortgage                              |   |   | (216 | ) |   |   | — |   |   |   | — |   |
| Real                estate construction                          |   |   | (17 | ) |   |   | — |   |   |   | — |   |
| Installment                loans to individuals                  |   |   | (536 | ) |   |   | (317 | ) |   |   | (431 | ) |
|                                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                charged-off                                 |   |   | (970 | ) |   |   | (717 | ) |   |   | (1,060 | ) |
|                                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Recoveries:                                                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                                                       |   |   | 116 |   |   |   | 480 |   |   |   | 561 |   |
| Agriculture                                                      |   |   | 150 |   |   |   | — |   |   |   | — |   |
| Installment                loans to individuals                  |   |   | 246 |   |   |   | 135 |   |   |   | 208 |   |
|                                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                recoveries                                  |   |   | 512 |   |   |   | 615 |   |   |   | 769 |   |
|                                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                charge-offs                                   |   |   | (458 | ) |   |   | (102 | ) |   |   | (291 | ) |
|                                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at end of period                          |   | $ | 9,153 |   |   | $ | 8,400 |   |   | $ | 8,361 |   |
|                                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Ratio                of net charge-offs                          |   |   |   |   |   |   |   |   |   |   |   |   |
| To                average loans outstanding during the period    |   |   | (0.09 | %) |   |   | (0.02 | %) |   |   | (0.06 | %) |
| Allowance                for loan losses                         |   |   |   |   |   |   |   |   |   |   |   |   |
| To                total loans at the end of the period           |   |   | 1.77 | % |   |   | 1.70 | % |   |   | 1.73 | % |
| To                non-performing loans at the end of the period  |   |   | 82.52 | % |   |   | 300.21 | % |   |   | 243.34 | % |

----

|                                       |   | (in                thousands)     |   |   |                             |   |
|--------------------------------------------|--------|-----------------------------------|--------|--------|----------------------------------|--------|
|                                       |   | September                30, 2007 |   |   | December                31, 2006 |   |
| Three                months or less        |   | $                                 | 24,029 |   |                             | $      | 28,729 |   |
| Over                three to twelve months |   |                              | 41,142 |   |                             |   | 32,355 |   |
| Over                twelve months          |   |                              | 4,959  |   |                             |   | 5,215 |   |
| Total                                      |   | $                                 | 70,130 |   |                             | $      | 66,299 |   |

|                             |   | (amounts                in thousands except percentage amounts) |   |
|----------------------------------|--------|-----------------------------------------------------------------|--------|
|                             |   | Actual                                                          |   |   | Well                Capitalized |   |   |   |   |
|                             |   |                                                            |   |   |   |   |   | Ratio |   |   | Minimum |   |
|                             |   | Capital                                                         |   |   | Ratio |   |   | Requirement |   |   | Capital |   |
| Leverage                         |   | $                                                               | 63,369 |   |   |   | 9.12 | % |   |   | 5.0 | % |   |   | 4.0 | % |
| Tier                1 Risk-Based |   | $                                                               | 63,369 |   |   |   | 10.61 | % |   |   | 6.0 | % |   |   | 4.0 | % |
| Total                Risk-Based  |   | $                                                               | 70,643 |   |   |   | 11.82 | % |   |   | 10.0 | % |   |   | 8.0 | % |

| Return                on Equity and Assets           |   |
|------------------------------------------------------|--------|
|                                                 |   |   |   |   |   |   |   |   |   |
|                                                 |   | Nine                months endedSeptember                30, 2007 |   |   | Nine                months endedSeptember                30, 2006 |   |   | Year                endedDecember                31, 2006 |   |
| Annualized                return on average assets   |   |   | 1.18 | % |   |   | 1.36 | % |   |   | 1.32 | % |
|                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| Annualized                return on beginning equity |   |   | 13.11 | % |   |   | 15.83 | % |   |   | 15.51 | % |

----

*Prospective      Accounting Pronouncements*

----

**ITEM      3.**

**QUANTITATIVE      AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**

**ITEM      4.**

**CONTROLS      AND PROCEDURES**

----

**PART      II - OTHER INFORMATION**

**ITEM      1A.**

**RISK      FACTORS**

**ITEM      2.**

**UNREGISTERED      SALES OF EQUITY SECURITIES AND USE OF PROCEEDS**

**Repurchases      of Equity Securities**

|                                                  |   | (a)                                            |    |   | (b)                                                       |   |   | (c)                                                                                                     |   |   | (d)                                                                                                          |   |
|-------------------------------------------------------|--------|------------------------------------------------|---------|--------|-----------------------------------------------------------|--------|--------|---------------------------------------------------------------------------------------------------------|--------|--------|--------------------------------------------------------------------------------------------------------------|--------|
| Period                                                |   | Total                number of sharespurchased |    |   | Average                pricepaid                per share |   |   | Number                of shares purchased as part of publicly announcedplans                or programs |   |   | Maximum                number of shares that may yet be purchased under the plans or                programs |   |
| July                1 - July 31, 2007                 |   |                                           | 39,237  |   |                                                      | $      | 17.10  |                                                                                                    |   |   | 39,237                                                                                                       |   |   |   | 295,809 |   |
| August                1 – August 31, 2007       |   |                                           | 64,204  |   |                                                      | $      | 17.30  |                                                                                                    |   |   | 64,204                                                                                                       |   |   |   | 231,605 |   |
| September                1 – September 30, 2007 |   |                                           | 17,003  |   |                                                      | $      | 18.95  |                                                                                                    |   |   | 17,003                                                                                                       |   |   |   | 214,602 |   |
| Total                                                 |   |                                           | 120,444 |   |                                                      | $      | 17.47  |                                                                                                    |   |   | 120,444                                                                                                      |   |   |   | 214,602 |   |

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**ITEM      6.**

**EXHIBITS**

| **Exhibit****Number** | **Exhibit**                                                                                                                                                                                                                     |
|-----------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                  |                                                                                                                                                                                                                            |
| 31.1                  | Certification                of the Company’s Chief Executive Officer pursuant to Section 302 of the                Sarbanes-Oxley                Act of 2002                                                             |
| 31.2                  | Certification                of the Company’s Chief Financial Officer pursuant to Section 302 of the                Sarbanes-Oxley                Act of 2002                                                             |
| 32.1                  | Certification                of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350,                as                adopted pursuantto                Section 906 of the Sarbanes-Oxley Act of 2002                |
| 32.2                  | Certification                of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350,                as                adopted pursuantto                Section 906 of the Sarbanes-Oxley Act of                2002 |

**SIGNATURES**

|   |                                  |   | **FIRST                NORTHERN COMMUNITY BANCORP**                                                    |
|--------|---------------------------------------|--------|--------------------------------------------------------------------------------------------------------|
|   |                                  |   |                                                                                                   |
| Date:  | November                8, 2007  | by     | /s/  Louise                A. Walker                                                         |
|   |                                  |   |                                                                                                   |
|   |                                  |   | Louise                A. Walker, Sr. Executive Vice President / Chief Financial                Officer |
|   |                                  |   | (Principal                Financial Officer and Duly Authorized                Officer)                |

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