**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 March 31, 2007**

**OR**

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

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

**Commission      File Number 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                                                       |   | 29 |
|                                             |   |                                                                                                                            |   |   |
| Item                4                            |   | Controls                and Procedures                                                                                          |   | 29 |
|                                             |   |                                                                                                                            |   |   |
| **PART                II: OTHER INFORMATION**    |   |                                                                                                                            |
|                                             |   |                                                                                                                            |   |   |
| Item                1A                           |   | Risk                Factors                                                                                                     |   | 30 |
|                                             |   |                                                                                                                            |   |   |
| Item                2                            |   | Unregistered                Sales of Equity Securities and Use of Proceeds                                                      |   | 30 |
|                                             |   |                                                                                                                            |   |   |
| Item                6                            |   | Exhibits                                                                                                                        |   | 31 |
|                                             |   |                                                                                                                            |   |   |
| Signatures                                       |   | 31                                                                                                                              |

----

**PART      I - FINANCIAL INFORMATION**

**ITEM      1.**

**CONSOLIDATED      FINANCIAL STATEMENTS**

***CONDENSED      CONSOLIDATED BALANCE SHEETS***

|                                                                                                                                                     |   | (UNAUDITED)                   |    |                             |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|---------|----------------------------------|--------|
|                                                                                                                                                     |   | March                31, 2007 |    | December                31, 2006 |   |
| ASSETS                                                                                                                                                   |   |                          |    |                             |   |
| Cash                and due from banks                                                                                                                   |   | $                             | 27,682  |                             | $      | 35,531 |   |
| Federal                funds sold                                                                                                                        |   |                          | 82,665  |                             |   | 62,470 |   |
| Investment                securities - available-for-sale                                                                                                |   |                          | 80,136  |                             |   | 74,180 |   |
| Loans,                net of allowance for loan losses of                                                                                                |   |                          |    |                             |   |   |   |
| $7,950                at March 31, 2007 and $8,361 at December 31, 2006                                                                                  |   |                          | 462,708 |                             |   | 475,549 |   |
| Loans                held-for-sale                                                                                                                       |   |                          | 7,718   |                             |   | 4,460 |   |
| Premises                and equipment, net                                                                                                               |   |                          | 8,225   |                             |   | 8,060 |   |
| Other                Real Estate Owned                                                                                                                   |   |                          | 1,475   |                             |   | 375 |   |
| Accrued                interest receivable and other assets                                                                                              |   |                          | 23,364  |                             |   | 24,600 |   |
|        TOTAL ASSETS                                                                                              |   | $                             | 693,973 |                             | $      | 685,225 |   |
|                                                                                                                                                     |   |                          |    |                             |   |   |   |
| LIABILITIES                AND STOCKHOLDERS' EQUITY                                                                                                      |   |                          |    |                             |   |   |   |
| Liabilities                                                                                                                                              |   |                          |    |                             |   |   |   |
|                                                                                                                                                     |   |                          |    |                             |   |   |   |
| Deposits                                                                                                                                                 |   |                          |    |                             |   |   |   |
| Demand                deposits                                                                                                                           |   | $                             | 179,410 |                             | $      | 197,498 |   |
| Interest-bearing                transaction deposits                                                                                                     |   |                          | 129,332 |                             |   | 117,620 |   |
| Savings                and MMDA's                                                                                                                        |   |                          | 183,055 |                             |   | 175,128 |   |
| Time,                under $100,000                                                                                                                      |   |                          | 50,908  |                             |   | 47,137 |   |
| Time,                $100,000 and over                                                                                                                   |   |                          | 72,044  |                             |   | 66,299 |   |
|        Total deposits                                                                                            |   |                          | 614,749 |                             |   | 603,682 |   |
| FHLB                Advances and other borrowings                                                                                                        |   |                          | 10,161  |                             |   | 10,981 |   |
| Accrued                interest payable and other liabilities                                                                                            |   |                          | 6,117   |                             |   | 8,572 |   |
|        TOTAL LIABILITIES                                                                                         |   |                          | 631,027 |                             |   | 623,235 |   |
|                                                                                                                                                     |   |                          |    |                             |   |   |   |
| Stockholders'                equity                                                                                                                      |   |                          |    |                             |   |   |   |
| Common                stock, no par value; 16,000,000 shares authorized;                                                                                 |   |                          |    |                             |   |   |   |
| 8,408,803                shares issued and outstanding at March 31, 2007 and 7,980,952 shares                issued and outstanding at December 31, 2006 |   |                          | 55,433  |                             |   | 45,726 |   |
| Additional                paid in capital                                                                                                                |   |                          | 977     |                             |   | 977 |   |
| Retained                earnings                                                                                                                         |   |                          | 7,018   |                             |   | 15,792 |   |
| Accumulated                other comprehensive loss                                                                                                      |   |                          | (482    | )                                |   | (505 | ) |
|        TOTAL STOCKHOLDERS' EQUITY                                                                           |   |                          | 62,946  |                             |   | 61,990 |   |
|                                                                                                                                                     |   |                          |    |                             |   |   |   |
|        TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                 |   | $                             | 693,973 |                             | $      | 685,225 |   |

----

**UNAUDITED      CONDENSED CONSOLIDATED STATEMENTS OF INCOME**

|                                                                                                                                                                             |   | Three                months   |    | Three                months   |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|---------|-------------------------------|--------|
|                                                                                                                                                                             |   | ended                         |    | ended                         |   |
|                                                                                                                                                                             |   | March                31, 2007 |    | March                31, 2006 |   |
| Interest Income                                                                                                                                                             |   |                          |    |                          |   |   |   |
|      Loans                                                                                                                                              |   | $                             | 10,375  |                          | $      | 9,684 |   |
|      Federal funds sold                                                                                                                       |   |                          | 860     |                          |   | 960 |   |
|      Investment securities                                                                                                                         |   |                          |    |                          |   |   |   |
|           Taxable                                                                                                              |   |                          | 650     |                          |   | 532 |   |
|           Non-taxable                                                                                                          |   |                          | 278     |                          |   | 131 |   |
|      Other                interest earning assets                                                                                                       |   |                          | 29      |                          |   | 24 |   |
|                Total interest income                                                        |   |                          | 12,192  |                          |   | 11,331 |   |
|                                                                                                                                                                             |   |                          |    |                          |   |   |   |
| Interest Expense                                                                                                                                                            |   |                          |    |                          |   |   |   |
|      Deposits                                                                                                                                           |   |                          | 2,892   |                          |   | 1,805 |   |
|      Other borrowings                                                                                                                              |   |                          | 77      |                          |   | 134 |   |
|                Total interest expense                                                       |   |                          | 2,969   |                          |   | 1,939 |   |
|                Net interest income                                                          |   |                          | 9,223   |                          |   | 9,392 |   |
| Recovery                of provision for loan losses                                                                                                                   |   |                          | (170    | )                             |   | (575 | ) |
|                                                                                                                                                                             |   |                          |    |                          |   |   |   |
|                Net interest income after recovery                of provision for |   |                          |    |                          |   |   |   |
|                                     loan losses                         |   |                          | 9,393   |                          |   | 9,967 |   |
|                                                                                                                                                                             |   |                          |    |                          |   |   |   |
| Other operating income                                                                                                                                                 |   |                          |    |                          |   |   |   |
|      Service charges on deposit accounts                                                                                            |   |                          | 793     |                          |   | 621 |   |
|      Gain on sales of other                real estate owned                                                                        |   |                          | — |                          |   | 7 |   |
|      Gains on sales of loans                held-for-sale                                                                           |   |                          | 46      |                          |   | 37 |   |
|      Investment and brokerage services income                                                                                       |   |                          | 67      |                          |   | 45 |   |
|      Mortgage brokerage income                                                                                                                |   |                          | 69      |                          |   | 85 |   |
|      Loan servicing income                                                                                                                    |   |                          | 75      |                          |   | 68 |   |
|      Fiduciary                activities income                                                                                                         |   |                          | 65      |                          |   | 33 |   |
|      ATM fees                                                                                                                                      |   |                          | 66      |                          |   | 69 |   |
|      Signature                based transaction fees                                                                                                    |   |                          | 114     |                          |   | 81 |   |
|      Other income                                                                                                                                  |   |                          | 203     |                          |   | 163 |   |
|                Total other operating income                                            |   |                          | 1,498   |                          |   | 1,209 |   |
|                                                                                                                                                                             |   |                          |    |                          |   |   |   |
| Other operating expenses                                                                                                                                               |   |                          |    |                          |   |   |   |
|      Salaries and employee benefits                                                                                                      |   |                          | 4,473   |                          |   | 4,543 |   |
|      Occupancy and equipment                                                                                                                  |   |                          | 998     |                          |   | 855 |   |
|      Data processing                                                                                                                               |   |                          | 408     |                          |   | 329 |   |
|      Stationery and supplies                                                                                                                  |   |                          | 146     |                          |   | 123 |   |
|      Advertising                                                                                                                                        |   |                          | 211     |                          |   | 216 |   |
|      Directors’ fees                                                                                                                         |   |                          | 54      |                          |   | 34 |   |
|      Other expense                                                                                                                                 |   |                          | 1,356   |                          |   | 1,227 |   |
|                Total other operating expenses                                          |   |                          | 7,646   |                          |   | 7,327 |   |
|                                                                                                                                                                             |   |                          |    |                          |   |   |   |
|                Income before income tax expense                                   |   |                          | 3,245   |                          |   | 3,849 |   |
| Provision for income taxes                                                                                                                                        |   |                          | 1,155   |                          |   | 1,447 |   |
|                                                                                                                                                                             |   |                          |    |                          |   |   |   |
|                Net income                                                                        |   | $                             | 2,090   |                          | $      | 2,402 |   |
|                                                                                                                                                                             |   |                          |    |                          |   |   |   |
| Basic earnings per share                                                                                                                                     |   | $                             | 0.25    |                          | $      | 0.28 |   |
| Diluted earnings per share                                                                                                                                        |   | $                             | 0.24    |                          | $      | 0.27 |   |
|                                                                                                                                                                             |   |                          |    |                          |   |   |   |

----

***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 |   | Income                / (Loss) |   | Total |   |
|                                                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at December 31, 2006                                                                                                     |   |   | 7,980,952 |   | $ | 45,726 |   |   |   |   | $ | 977 |   | $ | 15,792 |   | $ | (505 | ) | $ | 61,990 |   |
|                                                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Comprehensive                income:                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                income                                                                                                                       |   |   |   |   |   |   |   | $ | 2,090 |   |   |   |   |   | 2,090 |   |   |   |   |   | 2,090 |   |
| Other                comprehensive gain:                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unrealized                holding gains on securities arising during the current period, net                of tax                effect of $15 |   |   |   |   |   |   |   |   | 23 |   |   |   |   |   |   |   |   | 23 |   |   | 23 |   |
|                                                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Comprehensive                income                                                                                                             |   |   |   |   |   |   |   | $ | 2,113 |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 6%                stock dividend                                                                                                                |   |   | 476,976 |   |   | 10,851 |   |   |   |   |   |   |   |   | (10,851 | ) |   |   |   |   | — |   |
| Cash                in lieu of fractional shares                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   | (13 | ) |   |   |   |   | (13 | ) |
| Stock-based                compensation and related tax benefits                                                                                |   |   |   |   |   | 181 |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 181 |   |
| Stock                options exercised, net of swapped shares                                                                                   |   |   | 10,592 |   |   | — |   |   |   |   |   |   |   |   |   |   |   |   |   |   | — |   |
| Stock                repurchase and retirement                                                                                                  |   |   | (59,717 | ) |   | (1,325 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   | (1,325 | ) |
|                                                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at March 31, 2007                                                                                                        |   |   | 8,408,803 |   | $ | 55,433 |   |   |   |   | $ | 977 |   | $ | 7,018 |   | $ | (482 | ) | $ | 62,946 |   |

----

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

|                                                                                                                                                                                                                               |   | (in                thousands)                                   |    |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------|---------|
|                                                                                                                                                                                                                               |   | Three                months ended March                31, 2007 |    | Three                months ended March                31, 2006 |   |
| **Operating                Activities**                                                                                                                                                                                            |   |                                                            |    |   |   |
|           Net Income                                                                                                                                                        |   | $                                                               | 2,090   |   | $ | 2,402 |   |
|           Adjustments to reconcile net income to net                                                                                               |   |                                                            |    |   |   |   |   |
|  cash provided by operating activities:                                                                                                                                                                   |   |                                                            |    |   |   |   |   |
| Depreciation                                                                                                                                                                                                                       |   |                                                            | 337     |   |   | 253 |   |
| Recovery                of provision for loan losses                                                                                                                                                                               |   |                                                            | (170    | ) |   | (575 | ) |
| Stock                plan accruals                                                                                                                                                                                                 |   |                                                            | 181     |   |   | 95 |   |
| Tax                benefit for stock options                                                                                                                                                                                       |   |                                                            | — |   |   | 206 |   |
| Gains                on sales of loans held-for-sale                                                                                                                                                                               |   |                                                            | (46     | ) |   | (37 | ) |
| Gains                on sales of other real estate owned                                                                                                                                                                           |   |                                                            | — |   |   | (7 | ) |
| Proceeds                from sales of loans held-for-sale                                                                                                                                                                          |   |                                                            | 9,566   |   |   | 3,260 |   |
| Originations                of loans held-for-sale                                                                                                                                                                                 |   |                                                            | (12,778 | ) |   | (3,485 | ) |
| Decrease                in accrued interest receivable and other assets                                                                                                                                                            |   |                                                            | 1,274   |   |   | 346 |   |
| Decrease                in accrued interest payable and other liabilities                                                                                                                                                          |   |                                                            | (2,455  | ) |   | (2,195 | ) |
|                     Net cash                (used                in) provided by operating activities |   |                                                            | (2,001  | ) |   | 263 |   |
|                                                                                                                                                                                                                               |   |                                                            |    |   |   |   |   |
| **Investing Activities**                                                                                                                                                                                                      |   |                                                            |    |   |   |   |   |
|           Net increase in investment securities                                                                                                              |   |                                                            | (5,971  | ) |   | (15,176 | ) |
|           Net decrease                (increase) in loans                                                                                                         |   |                                                            | 13,011  |   |   | (6,693 | ) |
|           Net                (increase) decrease in other real estate owned                                                                                                 |   |                                                            | (1,100  | ) |   | 275 |   |
|           Purchases of premises and equipment, net                                                                                                      |   |                                                            | (502    | ) |   | (84 | ) |
|                     Net cash                provided                by (used in) investing activities |   |                                                            | 5,438   |   |   | (21,678 | ) |
|                                                                                                                                                                                                                               |   |                                                            |    |   |   |   |   |
| **Financing Activities**                                                                                                                                                                                                      |   |                                                            |    |   |   |   |   |
|           Net                increase in deposits                                                                                                                      |   |                                                            | 11,067  |   |   | 7,181 |   |
|           Net decrease in FHLB advances                                                                                                                      |   |                                                            | (820    | ) |   | (4,544 | ) |
|           Cash dividends paid                                                                                                                                          |   |                                                            | (13     | ) |   | (8 | ) |
| Tax                benefit for stock options                                                                                                                                                                                       |   |                                                            | — |   |   | (206 | ) |
|           Repurchase of stock                                                                                                                                          |   |                                                            | (1,325  | ) |   | (1,549 | ) |
|                     Net cash provided                by financing activities                                    |   |                                                            | 8,909   |   |   | 874 |   |
|                                                                                                                                                                                                                     |   |                                                            |    |   |   |   |   |
|                     Net increase                (decrease) in cash and cash equivalents          |   |                                                            | 12,346  |   |   | (20,541 | ) |
| Cash and cash equivalents at beginning of period                                                                                                                                                |   |                                                            | 98,001  |   |   | 122,692 |   |
| Cash and cash equivalents at end of period                                                                                                                                                      |   | $                                                               | 110,347 |   | $ | 102,151 |   |
|                                                                                                                                                                                                                               |   |                                                            |    |   |   |   |   |
| Supplemental disclosures of cash flow information:                                                                                                                                                        |   |                                                            |    |   |   |   |   |
| Cash paid during the period for:                                                                                                                                                                          |   |                                                            |    |   |   |   |   |
|                     Interest                                                                                                   |   | $                                                               | 2,958   |   | $ | 1,946 |   |
|                     Income Taxes                                                                                          |   | $                                                               | 107     |   |   | — |   |
|                                                                                                                                                                                                                               |   |                                                            |    |   |   |   |   |
| Supplemental disclosures of non-cash investing and financing activities:                                                                                                                        |   |                                                            |    |   |   |   |   |
| 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)                              |   |
|--------------------------------------------------------|--------|------------------------------------------------------------|--------|
|                                                   |   |                                                       |   |   |   |
|                                                   |   | Three                months ended March                31, |   | Year                ended December 31, |   |
|                                                   |   | 2007                                                       |   | 2006 |   | 2006 |   |
| Balance,                beginning of period            |   | $                                                          | 8,361  |   | $ | 7,917 |   | $ | 7,917 |   |
| (Recovery                of) provision for loan losses |   |                                                       | (170   | ) |   | (575 | ) |   | 735 |   |
| Loan                charge-offs                        |   |                                                       | (289   | ) |   | (57 | ) |   | (1,060 | ) |
| Loan                recoveries                         |   |                                                       | 48     |   |   | 513 |   |   | 769 |   |
| Balance,                end of period                  |   | $                                                          | 7,950  |   | $ | 7,798 |   | $ | 8,361 |   |

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

|                                     |   | (in                thousands)    |   |
|------------------------------------------|--------|----------------------------------|--------|
|                                     |   | December                31, 2006 |   | Additions |   | Reductions |   | March                31, 2007 |   |
|                                     |   |                             |   |   |   |   |   |   |   |
| Mortgage                servicing rights |   | $                                | 945    |   | $ | 43 |   | $ | 40 |   | $ | 948 |   |

----

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

|                                                               |   | (in                thousands, except share and earnings per share amounts) |      |
|--------------------------------------------------------------------|--------|----------------------------------------------------------------------------|-----------|
|                                                               |   | Three                months ended March 31,                                |      |
|                                                               |   | 2007                                                                       |      | 2006 |   |
| Basic                earnings per share:                           |   |                                                                       |      |   |   |   |   |
| Net                income                                          |   | $                                                                          | 2,090     |   | $ | 2,402 |   |
|                                                               |   |                                                                       |      |   |   |   |   |
| Weighted                average common shares outstanding          |   |                                                                       | 8,431,880 |   |   | 8,503,922 |   |
| Basic                EPS                                           |   | $                                                                          | 0.25      |   | $ | 0.28 |   |
|                                                               |   |                                                                       |      |   |   |   |   |
| Diluted                earnings per share:                         |   |                                                                       |      |   |   |   |   |
| Net                income                                          |   | $                                                                          | 2,090     |   | $ | 2,402 |   |
|                                                               |   |                                                                       |      |   |   |   |   |
| Weighted                average common shares outstanding          |   |                                                                       | 8,431,880 |   |   | 8,503,922 |   |
|                                                               |   |                                                                       |      |   |   |   |   |
| Effect                of dilutive options                          |   |                                                                       | 259,902   |   |   | 315,896 |   |
|                                                               |   |                                                                       |      |   |   |   |   |
| Adjusted                weighted average common shares outstanding |   |                                                                       | 8,691,782 |   |   | 8,819,818 |   |
| Diluted                EPS                                         |   | $                                                                          | 0.24      |   | $ | 0.27 |   |

----

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

*Accounting      for Stock-Based *
*Compensation      *
*-*
*      Transition and Disclosure*
*,      an      amendment of FASB Statement No. 123*

----

|                                                      |   | 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                                                 |   |                            | (13,324 | )                                              |   | 3.38                                     |   | $                                                          | 240,921   |   |   |   |   |
|                                                      |   |                            |    |                                           |   |                                     |   |                                                       |      |   |   |   |   |
| Options                outstanding at End of Period       |   |                            | 585,600 |                                           | $      | 11.03                                    |   | $                                                          | 4,815,806 |   |   | 6.04 |   |
|                                                      |   |                            |    |                                           |   |                                     |   |                                                       |      |   |   |   |   |
| Exercisable                (vested) at End of Period      |   |                            | 421,707 |                                           | $      | 8.65                                     |   | $                                                          | 4,218,298 |   |   | 5.06 |   |

----

|                                     | Three                Months Ended |   |   |
|------------------------------------------|-----------------------------------|--------|--------|
| March                31, 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 |   |
|------------------------------------------|-----------------------------------|--------|
| March                31, 2007            |
| Risk                Free Interest Rate   | 5.00%                             |   |
|                                     |                              |   |
| Expected                Dividend Yield   | 0.00%                             |   |
|                                     |                              |   |
| Expected                Life in Years    | 1.00                              |   |
|                                     |                              |   |
| Expected                Price Volatility | 22.97%                            |   |

----

| 6. | FIRST                NORTHERN BANK - EXECUTIVE RETIREMENT                PLAN |
|----|-------------------------------------------------------------------------------|

|                                                   |   | Three                months ended March 31, |   |
|--------------------------------------------------------|--------|---------------------------------------------|--------|
|                                                   |   | 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 March                31, |   |
|--------------------------------------------------------|--------|------------------------------------------------------------|--------|
|                                                   |   | 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**

| ·   | Net                income of $2.09 million, down 12.9% over the $2.40 million earned                in the                same fiscal period last year. (First quarter 2007 net income was                increased                through a $100,000, net of tax, recovery of provision for loan losses                from                a prior period. First quarter 2006 net income was increased through                a                $339,000, net of tax, recovery of provision for loan losses from                a prior                period.) |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Diluted                earnings per share for the three months ended March 31, 2007 of $0.24,                down 11.1% from the $0.27 reported in the same period last year (all                2006                per share earnings have been adjusted for the 6% stock dividend paid                March                30, 2007). |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Recovery                of provision for loan losses from a prior period of $170,000 for                the                three-month period ended March 31, 2007 compared to a recovery of                provision for loan losses from a prior period of $575,000 for the                same                period in 2006. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Provision                for unfunded lending commitment losses of $50,000 for the three-month                period ended March 31, 2007 compared to a provision for unfunded                lending                commitment losses of $100,000 for the same period in                2006. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Annualized                Return on Average Assets for the three-month period ended March 31,                2007                of 1.22%, compared to 1.44% for the same period in 2006. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Annualized                Return on Beginning Equity for the three-month period ended March                31, 2007                of 13.49%, compared to 16.91% for the same period in 2006. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Total                assets at March 31, 2007 of $694.0 million, an increase of $32.0                million,                or 4.8%, from prior-year first quarter levels. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Total                deposits of $614.7 million at March 31, 2007, an increase of $25.7                million                or 4.4% compared to March 31, 2006. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Total                net loans at March 31, 2007 (including loans held-for-sale) increased                $2.4                million, or 0.5%, to $470.4 million compared to March 31,                2006. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Total                investment securities at March 31, 2007 increased $18.2 million,                or 29.4%,                to $80.1 million compared to March 31,                2006. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**SUMMARY**

|    | (Amounts                in thousands, except percentage and per share amounts) |                          |
|---------|--------------------------------------------------------------------------------|-------------------------------|
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  . |                                                                           |                          |   |  Three                months |  Three                months |   |   |
|    |                                                                           |                          |   | ended | ended |   |   |   |   |   |   |
|    |                                                                           | March                31, 2007 | March                31, 2006 |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |   |
|    | For                the Period:                                                 |                          |   |   |   |   |   |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    | Net                Income                                                      |                          |   | $ | 2,090 |   | $ | 2,402 |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |   |
|    |  Basic                Earnings Per Share*                                 | $                             | 0.25 |   | $ | 0.28 |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    | Diluted                Earnings Per Share*                                     | $                             | 0.24 |   | $ | 0.27 |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |
|    | Return                on Average Assets                                        |                          | 1.22% |   |   | 1.44% |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |   |
|    | Net                Earning / Beginning Equity                                  |                          | 13.49% |   |   | 16.91% |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    | At                Period End:                                                  |                          |   |   |   |   |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |
|    | Total                Assets                                                    | $                             | 693,973 |   | $ | 662,038 |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |
|    |  Total                Loans, Net (including loans held-for-sale)          | $                             | 470,426 |   | $ | 468,031 |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |   |
|    | Total                Deposits                                                  | $                             | 614,749 |   | $ | 588,962 |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |
|    |  Loan-To-Deposit                Ratio                                     | 76.5%                         |   |   | 79.5% |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    | *Adjusted                for stock dividends                                   |                          |   |   |   |   |   |   |   |   |   |   |
|    |                                                                           |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

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

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | Three                months ended |     | Three                months ended |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|----------|-----------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | March                31, 2007     |     | March                31, 2006     |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | Average                           |     |                              |   | Yield/ |   | Average |   |   |   | Yield/ |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | Balance                           |     | Interest                          |   | Rate |   | Balance |   | Interest |   | Rate |   |
| **Assets**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                              |     |                              |   |   |   |   |   |   |   |   |   |
| Interest-earning                assets:                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                              |     |                              |   |   |   |   |   |   |   |   |   |
| Loans                (1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                              | $478,034 |                              |   | $10,375 |   |   | 8.80 | % |   | $462,546 |   |   | $9,684 |   |   | 8.49 | % |
| Investment                securities, taxable                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                              | 53,423   |                              |   | 650 |   |   | 4.93 | % |   | 44,417 |   |   | 532 |   |   | 4.86 | % |
| Investment                securities, non-taxable (2)                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                              | 25,789   |                              |   | 278 |   |   | 4.37 | % |   | 10,988 |   |   | 131 |   |   | 4.84 | % |
| Federal                funds sold                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                              | 67,035   |                              |   | 860 |   |   | 5.20 | % |   | 89,301 |   |   | 960 |   |   | 4.36 | % |
| Other                interest earning assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                              | 2,107    |                              |   | 29 |   |   | 5.58 | % |   | 2,135 |   |   | 24 |   |   | 4.56 | % |
| Total                interest-earning assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                              | 626,388  |                              |   | 12,192 |   |   | 7.89 | % |   | 609,387 |   |   | 11,331 |   |   | 7.54 | % |
| Non-interest-earning                assets:                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                              |     |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                and due from banks                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                              | 27,202   |                              |   |   |   |   |   |   |   | 31,972 |   |   |   |   |   |   |   |
| Premises                and equipment, net                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                              | 8,246    |                              |   |   |   |   |   |   |   | 8,255 |   |   |   |   |   |   |   |
| Other                real estate owned                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                              | 1,248    |                              |   |   |   |   |   |   |   | 231 |   |   |   |   |   |   |   |
| Accrued                interest receivable and other assets                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                              | 21,601   |                              |   |   |   |   |   |   |   | 19,552 |   |   |   |   |   |   |   |
| Total                average assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                              | 684,685  |                              |   |   |   |   |   |   |   | 669,397 |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                              |     |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Liabilities                and Stockholders’ Equity:**                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                              |     |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing                liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                              |     |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing                transaction deposits                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                              | 123,278  |                              |   | 736 |   |   | 2.42 | % |   | 85,069 |   |   | 215 |   |   | 1.02 | % |
| Savings                and MMDA’s                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                              | 182,121  |                              |   | 1,080 |   |   | 2.40 | % |   | 195,403 |   |   | 782 |   |   | 1.62 | % |
| Time,                under $100,000                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                              | 47,397   |                              |   | 381 |   |   | 3.26 | % |   | 51,314 |   |   | 309 |   |   | 2.44 | % |
| Time,                $100,000 and over                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                              | 68,898   |                              |   | 695 |   |   | 4.09 | % |   | 67,509 |   |   | 499 |   |   | 3.00 | % |
| FHLB                advances and other borrowings                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                              | 10,400   |                              |   | 77 |   |   | 3.00 | % |   | 13,211 |   |   | 134 |   |   | 4.11 | % |
| Total                interest-bearing liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                              | 432,094  |                              |   | 2,969 |   |   | 2.79 | % |   | 412,506 |   |   | 1,939 |   |   | 1.91 | % |
| Non-interest-bearing                liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                              |     |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Non-interest-bearing                demand deposits                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                              | 183,430  |                              |   |   |   |   |   |   |   | 193,905 |   |   |   |   |   |   |   |
| Accrued                interest payable and other liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                              | 7,144    |                              |   |   |   |   |   |   |   | 5,799 |   |   |   |   |   |   |   |
| Total                liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                              | 622,668  |                              |   |   |   |   |   |   |   | 612,210 |   |   |   |   |   |   |   |
| Total                stockholders’ equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                              | 62,017   |                              |   |   |   |   |   |   |   | 57,187 |   |   |   |   |   |   |   |
| Total                average liabilities and stockholders’ equity                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                              | $684,685 |                              |   |   |   |   |   |   |   | $669,397 |   |   |   |   |   |   |   |
| Net                interest income and net interest margin (3)                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                              |     |                              |   | $9,223 |   |   | 5.97 | % |   |   |   |   | $9,392 |   |   | 6.25 | % |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                              |     |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 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 $644 and $692 for the                three                months ended March 31, 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 |   |
|                                                                              |   |   |   | ended                             |   | ended |   |
|                                                                              |   |   |   | March                    31, 2007 |   | March                    31, 2006 |   |
|                                                                              |   |   |   |                              |   |   |   |    |   |
|                    Other                    miscellaneous operating expenses |   |   |   |                              |   |   |   |    |   |
| Provision                    for unfunded lending commitments                     |   |   |   |                              |   |   |   | $ | 50 |   | $ | 100 |   |
| Contributions                                                                     |   |   |   |                              |   |   |   |   | 52 |   |   | 22 |   |
| Legal                    fees                                                     |   |   |   |                              |   |   |   |   | 71 |   |   | 45 |   |
| Accounting                    and audit fees                                      |   |   |   |                              |   |   |   |   | 126 |   |   | 164 |   |
| Consulting                    fees                                                |   |   |   |                              |   |   |   |   | 96 |   |   | 98 |   |
| Postage                    expense                                                |   |   |   |                              |   |   |   |   | 85 |   |   | 92 |   |
| Telephone                    expense                                              |   |   |   |                              |   |   |   |   | 61 |   |   | 54 |   |
| Public                    relations                                               |   |   |   |                              |   |   |   |   | 79 |   |   | 70 |   |
| Training                    expense                                               |   |   |   |                              |   |   |   |   | 77 |   |   | 63 |   |
| Loan                    origination expense                                       |   |   |   |                              |   |   |   |   | 214 |   |   | 142 |   |
| Computer                    software depreciation                                 |   |   |   |                              |   |   |   |   | 57 |   |   | 67 |   |
| Other                    miscellaneous expense                                    |   |   |   |                              |   |   |   |   | 388 |   |   | 310 |   |
|                                                                              |   |   |   |                              |   |   |   |   |   |   |   |   |   |
|                                                                              |   |   |   |                              |   |   |   |   |   |   |   |   |   |
| Total                    other miscellaneous operating expenses                   |   |   |   |                              |   |   |   | $ | 1,356 |   | $ | 1,227 |   |

----

|                                          |   | (in                  thousands) |    |
|-----------------------------------------------|--------|---------------------------------|---------|
|                                          |   |                            |    |   |   |
|                                          |   | March                  31, 2007 |    | December                  31, 2006 |   |
|                                          |   |                            |    |   |   |
| Undisbursed                  loan commitments |   | $                               | 213,001 |   | $ | 198,200 |   |
| Standby                  letters of credit    |   |                            | 12,015  |   |   | 12,222 |   |
|                                          |   | $                               | 225,016 |   | $ | 210,422 |   |

*See        *

----

| Analysis                  of the Allowance for Loan Losses         |   |
|--------------------------------------------------------------------|--------|
| (Amounts                  in thousands, except percentage amounts) |   |
|                                                               |   |   |   |   |   |
|                                                               |   | Three                  months endedMarch                  31, |   | Year                  endedDecember                  31, |   |
|                                                               |   | 2007 |   | 2006 |   | 2006 |   |
|                                                               |   |   |   |   |   |   |   |
| Balance                  at beginning of period                    |   | $ | 8,361 |   | $ | 7,917 |   | $ | 7,917 |   |
| (Recovery                  of) provision for loan losses           |   |   | (170 | ) |   | (575 | ) |   | 735 |   |
| Loans                  charged-off:                                |   |   |   |   |   |   |   |   |   |   |
| Commercial                                                         |   |   | (41 | ) |   | — |   |   | (572 | ) |
| Agriculture                                                        |   |   | — |   |   | — |   |   | (57 | ) |
| Real                  estate mortgage                              |   |   | (120 | ) |   | — |   |   | — |   |
| Real                  estate construction                          |   |   | — |   |   | — |   |   | — |   |
| Installment                  loans to individuals                  |   |   | (128 | ) |   | (57 | ) |   | (431 | ) |
|                                                               |   |   |   |   |   |   |   |   |   |   |
| Total                  charged-off                                 |   |   | (289 | ) |   | (57 | ) |   | (1,060 | ) |
|                                                               |   |   |   |   |   |   |   |   |   |   |
| Recoveries:                                                        |   |   |   |   |   |   |   |   |   |   |
| Commercial                                                         |   |   | 1 |   |   | 480 |   |   | 561 |   |
| Agriculture                                                        |   |   | — |   |   | — |   |   | — |   |
| Real                  estate mortgage                              |   |   | — |   |   | — |   |   | — |   |
| Real                  estate construction                          |   |   | — |   |   | — |   |   | — |   |
| Installment                  loans to individuals                  |   |   | 47 |   |   | 33 |   |   | 208 |   |
|                                                               |   |   |   |   |   |   |   |   |   |   |
| Total                  recoveries                                  |   |   | 48 |   |   | 513 |   |   | 769 |   |
|                                                               |   |   |   |   |   |   |   |   |   |   |
| Net                  (charge-offs) recoveries                      |   |   | (241 | ) |   | 456 |   |   | (291 | ) |
|                                                               |   |   |   |   |   |   |   |   |   |   |
| Balance                  at end of period                          |   | $ | 7,950 |   | $ | 7,798 |   | $ | 8,361 |   |
|                                                               |   |   |   |   |   |   |   |   |   |   |
| Ratio                  of net (charge-offs) recoveries             |   |   |   |   |   |   |   |   |   |   |
| To                  average loans outstanding during the period    |   |   | (0.05 | %) |   | 0.10 | % |   | (0.06 | %) |
| Allowance                  for loan losses                         |   |   |   |   |   |   |   |   |   |   |
| To                  total loans at the end of the period           |   |   | 1.69 | % |   | 1.66 | % |   | 1.73 | % |
| To                  non-performing loans at the end of the period  |   |   | 270.96 | % |   | 255.42 | % |   | 243.34 | % |

----

|                                           |   | (in                    thousands) |   |
|------------------------------------------------|--------|-----------------------------------|--------|
|                                           |   | March                    31, 2007 |   | December                    31, 2006 |   |
| Three                    months or less        |   | $                                 | 26,822 |   | $ | 28,729 |   |
| Over                    three to twelve months |   |                              | 38,915 |   |   | 32,355 |   |
| Over                    twelve months          |   |                              | 6,307  |   |   | 5,215 |   |
| Total                                          |   | $                                 | 72,044 |   | $ | 66,299 |   |

|                                 | (amounts                    in thousands except percentage amounts) |
|--------------------------------------|---------------------------------------------------------------------|
|                                 |                                                                | Actual |   | Well                    Capitalized Ratio Requirement |   | Minimum                    Capital |
| Capital                              |                                                                | Ratio |
|                                 |                                                                |   |   |   |   |   |   |   |
| Leverage                             |                                                                | $                    62,825 |   | 9.15% |   | 5.0% |   | 4.0% |
| Tier                    1 Risk-Based |                                                                | $                    62,825 |   | 11.14% |   | 6.0% |   | 4.0% |
| Total                    Risk-Based  |                                                                | $                    69,462 |   | 12.32% |   | 10.0% |   | 8.0% |

|                                                   | Three                  months endedMarch                  31, 2007 |   | Three                  months endedMarch                  31, 2006 |   | Year                  endedDecember                  31, 2006 |
|--------------------------------------------------------|--------------------------------------------------------------------|--------|--------------------------------------------------------------------|--------|---------------------------------------------------------------|
| Annualized                  return on average assets   | 1.22%                                                              |   | 1.44%                                                              |   | 1.32%                                                         |
|                                                   |                                                               |   |                                                               |   |                                                          |
| Annualized                  return on beginning equity | 13.49%                                                             |   | 16.91%                                                             |   | 15.51%                                                        |

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*Prospective        Accounting Pronouncements*

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**ITEM        3.**

**QUANTITATIVE        AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**

**ITEM        4.**

**CONTROLS        AND PROCEDURES**

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**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 |   |
| January                  1 - January 31, 2007   |   |                                             | 40,115 |                                                          | $      | 21.72                                                                                                       |   |                                                                                                             | 40,115 |   |   | 92,280 |   |
| February                  1 - February 28, 2007 |   |                                             | 2,433  |                                                          | $      | 21.59                                                                                                       |   |                                                                                                             | 2,433  |   |   | 89,847 |   |
| March                  1 - March 31, 2007       |   |                                             | 19,578 |                                                          | $      | 20.51                                                                                                       |   |                                                                                                             | 19,578 |   |   | 70,269 |   |
| Total                                           |   |                                             | 62,126 |                                                          | $      | 21.33                                                                                                       |   |                                                                                                             | 62,126 |   |   | 70,269 |   |

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**ITEM          6. **

**EXHIBITS**

| **Exhibit****Number** | **Exhibit**                                                                                                                                                                                                                                                       |
|-----------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                  |                                                                                                                                                                                                                                                              |
| 10.1                  | Participation                    Agreements - Supplemental Executive Retirement Plan (incorporated                    by                    reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K                    dated January 9, 2007) |
| 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:                    May                    9, 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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