U.S. SECURITIES AND EXCHANGE COMMISSION
                              Washington D.C. 20549

                                   FORM 10-QSB

[X]  QUARTERLY  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE ACT
     OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1999

[x]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE ACT
     OF 1934 FOR THE TRANSITION PERIOD FROM ____________ TO _________


Commission file number 0-27984


                       Ridgestone Financial Services, Inc.
                       ----------------------------------
        (Exact name of small business issuer as specified in its charter)


              Wisconsin                                    39-1797151
              ---------                                    ----------
     (State or other jurisdiction of                    (I.R.S. Employer
     incorporation or organization)                     Identification No.)

                             13925 West North Avenue
                          Brookfield, Wisconsin 53005
                     --------------------------------------
                    (Address of principal executive offices)

                                  414-789-1011
                            -------------------------
                           (Issuer's telephone number)


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

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

         Class                            Outstanding as of September 30, 1999
         -----                            ------------------------------------

         Common Stock, no par value                      876,492

Transitional Small Business Disclosure Format:     Yes____   No __X__


<PAGE>

               RIDGESTONE FINANCIAL SERVICES, INC. AND SUBSIDIARY

                                      INDEX

                                                                            Page
                                                                          Number
PART I - FINANCIAL INFORMATION

         Item 1.  Financial Statements.......................................  1

                  Consolidated Statements of Financial Condition at
                  September 30, 1999 and December 31, 1998...................  1

                  Consolidated Statements of Income
                  For the Three Months and Nine Months Ended
                  September 30, 1999 and 1998................................  2

                  Consolidated Statements of Cash Flows
                  For the Nine Months Ended September 30, 1999 and 1998......  3

                  Consolidated Statements of Stockholders' Equity
                  For the Nine Months Ended September 30, 1999 and 1998......  4

                  Notes to Consolidated Financial Statements.................  5


         Item 2.  Management's Discussion and Analysis.......................  6



PART II - OTHER INFORMATION

         Item 6.  Exhibits and Reports on Form 8-K........................... 12



SIGNATURES                 .................................................. 13

EXHIBIT INDEX              .................................................. 14


<PAGE>

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                  RIDGESTONE FINANCIAL SERVICES, INC. AND SUBSIDIARY
                    CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                          September 30, 1999 and December 31, 1998


                                                  September 30,    December 31,
                                                       1999            1998
                                                   (Unaudited)
                                                  ------------    ------------
ASSETS
Cash and due from banks                           $  3,614,362    $  2,741,672
Interest-bearing deposits in banks                     261,948           2,649
Federal funds sold                                   1,975,000      12,525,000
Investments-Held to Maturity                           999,340       1,750,335
      (fair value Sep 1999, $1,006,268
              and Dec 1998, $1,780,700)
Investments-Available for Sale                       1,807,486         615,284


Loans receivable                                    52,690,306      48,869,077
   Less: Allowance for estimated loan losses          (563,305)       (562,747)
                                                  ------------    ------------
Net loans receivable                                52,127,001      48,306,330

Mortgage loans held for sale                                 0         259,000
Office building and equipment, net                   1,375,530       1,376,660
Other real estate owned                              1,035,215       1,297,835
Cash surrender value of life insurance               1,818,887       1,797,153
Accrued interest & other assets                      1,160,693         663,617
                                                  ------------    ------------

      Total assets                                $ 66,175,462    $ 71,335,535
                                                  ============    ============


LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Deposits:
      Demand                                      $  8,798,752    $  8,552,053
      Savings, NOW and other time deposits          50,291,788      55,970,803
                                                  ------------    ------------
        Total deposits                              59,090,540      64,522,856
                                                  ------------    ------------

Accrued interest & other liabilities                   525,057         614,535
                                                  ------------    ------------

      Total liabilities                             59,615,597      65,137,391
                                                  ------------    ------------

STOCKHOLDERS' EQUITY
Common stock, no par value: 10,000,000 shares authorized:
876,492 issued and outstanding                       8,417,117       8,417,117
Retained earnings (deficit)                         (1,825,627)     (2,196,449)
Accumulated other comprehensive income(loss)           (31,625)        (22,524)
                                                  ------------    ------------

      Total stockholders' equity                     6,559,865       6,198,144
                                                  ------------    ------------

      Total liabilities and stockholders' equity  $ 66,175,462    $ 71,335,535
                                                  ============    ============


                                       -1-

<PAGE>

<TABLE>
                       RIDGESTONE FINANCIAL SERVICES, INC. AND SUBSIDIARY
                                CONSOLIDATED STATEMENTS OF INCOME
                       Three and Nine Months Ended September 30, 1999 and 1998
                                        (Unaudited)
<CAPTION>

                                                Three Months Ended            Nine Months Ended
                                           ---------------------------   ---------------------------
                                               Sept 30,     Sept 30,         Sept 30,    Sept 30,
                                                1999          1998            1999          1998
                                           ------------- -------------   ------------- -------------
Interest income:
<S>                                        <C>           <C>             <C>           <C>
         Interest and fees on loans        $  1,103,337  $  1,118,712    $  3,062,623  $  3,127,392
         Interest on securities                  27,120       138,521         173,330       292,327
         Interest on federal funds sold         103,761        50,057         307,950       202,252
         Interest on deposits in banks            2,057         1,585           3,949         5,945
                                           ------------- -------------   ------------- -------------
             Total interest income            1,236,275     1,308,875       3,547,852     3,627,916
                                           ------------- -------------   ------------- -------------

Interest expense:
         Interest on deposits                   601,155       761,269       1,834,932     2,151,636
                                           ------------- -------------   ------------- -------------

             Net interest income before
             provision for loan losses          635,120       547,606       1,712,920     1,476,280

Provision for loan losses                       125,000        30,000         192,500        45,000
                                           ------------- -------------   ------------- -------------
             Net interest income after
             provision for loan losses          510,120       517,606       1,520,420     1,431,280
                                           ------------- -------------   ------------- -------------

Non interest income:
         Secondary market loan fees              11,253        35,565          49,690        90,746
         Service charges on deposit accts        28,809         8,596          60,561        26,236
         Miscellaneous                           47,307        22,120         136,999        56,999
                                           ------------- -------------   ------------- -------------
             Total non interest income           87,369        66,281         247,250       173,981
                                           ------------- -------------   ------------- -------------

Non interest expense:
         Salaries and employee benefits         263,579       298,185         783,181       823,395
         Occupancy and equipment expense        113,989       101,831         319,231       277,238
         Gain on sale of assets                  14,065             0          38,822             0
         Gain on sale of AFS securities               0             0          15,402         7,687
         Other expense                          178,274       132,833         531,062       384,093
                                           ------------- -------------   ------------- -------------
             Total non interest expense         569,907       532,849       1,687,698     1,492,413
                                           ------------- -------------   ------------- -------------

Income before income taxes                       27,582        51,038          79,972       112,848

Income taxes(benefit)                          ( 94,840)     ( 49,533)       (290,850)     (142,233)
                                           ------------- --------------   ------------ --------------

Net income                                 $    122,422  $    100,571    $    370,822  $    255,081
                                           ============= =============   ============= =============

Earnings per share:
         Basic                             $       0.14  $       0.12    $       0.42  $       0.29
         Diluted                           $       0.13  $       0.12    $       0.38  $       0.29

Weighted average shares outstanding             876,492       876,055         876,492       862,150

</TABLE>

                                       -2-

<PAGE>
<TABLE>

                      RIDGESTONE FINANCIAL SERVICES, INC. AND SUBSIDIARY
                             CONSOLIDATED STATEMENTS OF CASH FLOWS
                          Nine Months Ended September 30, 1999 and 1998
                                        (Unaudited)
<CAPTION>
                                                                       Nine Months Ended
                                                                -----------------------------
                                                                    Sept 30,        Sept 30,
                                                                      1999            1998
                                                                -------------   -------------
Cash Flows From Operating Activities:
<S>                                                             <C>             <C>
      Net income                                                $    370,822    $    255,081
         Adjustments to reconcile net income to
         net cash provided by (used in) operating activities:
             Depreciation                                            113,490         118,575
             Loss on sale of investment securities                    15,402           7,687
             Provision for loan losses                               192,500          45,000
             Gain on sale other assets                               (38,222)              0
             Accretion/Amortization of securities-net                    603            (452)
             Net decrease in mortgage loans held for sale            259,000        (576,050)
         (Increase)decrease in assets:
             Interest receivable                                     (22,563)         11,237
             Other assets                                           (496,247)     (1,741,014)
         Increase(decrease) in liabilities:
             Accrued interest                                       (226,264)         60,410
             Other liabilities                                       136,786         (87,751)
                                                                -------------   -------------
         Total adjustments                                           (65,515)     (2,162,358)
                                                                -------------   --------------
      Net cash provided by (used in) operating activities            305,307      (1,907,277)
                                                                -------------   --------------

Cash Flows From Investing Activities:
         Net increase in interest-bearing deposits                  (259,299)         (2,470)
         Proceeds from sales of available for sale securities         80,548         141,316
         Net (increase) decrease in federal funds sold            10,550,000        (629,000)
         Purchase of available for sale securities                (1,796,860)       (138,200)
         Proceeds from maturities of held to maturity securities   1,500,000       2,500,000
         Purchase of held to maturity securities                    (250,000)              0
         Net proceeds on other real estate                           300,842         449,276
         Purchases of premises and equipment                        (112,361)        (39,112)
         Net increase in loans                                    (4,013,171)     (5,005,115)
                                                                -------------   -------------
      Net cash provided by (used in) investing activities          5,999,699      (2,723,305)
                                                                -------------   -------------

Cash Flows From Financing Activities:
      Net increase(decrease) in deposits                          (5,432,316)      4,079,592
                                                                -------------   -------------
      Net cash provided by (used in) financing activities         (5,432,316)      4,079,592

Net (decrease)increase in cash and cash equivalents                  872,690        (550,990)
Cash and due from banks, beginning                                 2,741,672       2,671,051
                                                                -------------   -------------
Cash and due from banks, ending                                 $  3,614,362    $  2,120,061
                                                                =============   =============

Supplemental  disclosure of cash flow information
         Cash paid during the period for:
             Interest                                           $  2,061,196    $ 2,091,225
                                                                =============   ============

             Income taxes                                       $          0    $    10,267
                                                                =============   ============

Supplemental schedule of noncash investing activities:
Net changes in unrealized gain on securities
available for sale                                              $     (9,101)    $   38,075
                                                                ==============   ===========

</TABLE>

                                       -3-

<PAGE>

<TABLE>
                       RIDGESTONE FINANCIAL SERVICES, INC.  AND SUBSIDIARY
                         CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                          Nine Months Ended September 30, 1999 and 1998
<CAPTION>

                                                                           Accumulated
                                                            Retained          Other
                                              Common        Earnings      Comprehensive
                                              Stock         (Deficit)     Income (Loss)       Total
                                          -------------   -------------   -------------   -------------
<S>                                       <C>             <C>             <C>             <C>
Balances, December 31, 1997               $  7,721,399    $ (1,837,493)   $    (20,606)   $  5,863,300
Stock Dividend                                 690,333        (690,333)

Comprehensive income:
     Net income                                                255,081                         255,081

     Change in unrealized gain
     on available for sale securities                                           38,075          38,075
                                                                                          -------------
     Total comprehensive income                                                                293,156
                                          -------------   -------------   -------------   -------------
Balances, September 30, 1998              $  8,411,732    $ (2,272,745)   $     17,469    $  6,156,456
                                          =============   =============   =============   =============

Balances, December 31, 1998               $  8,417,117    $ (2,196,449)        (22,524)   $  6,198,144

Comprehensive income:
     Net income                                                370,822                         370,822

     Change in unrealized gain
     on available for sale securities                                           (9,101)         (9,101)
                                                                                          -------------

     Total comprehensive income                                                                361,721
                                          -------------   -------------   -------------   -------------
Balances, September 30, 1999              $  8,417,117    $ (1,825,627)   $    (31,625)   $  6,559,865
                                          =============   =============   =============   ============


</TABLE>

                                       -4-
<PAGE>

               RIDGESTONE FINANCIAL SERVICES, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           September 30, 1999 and 1998
                                   (Unaudited)

NOTE 1 - BASIS OF PRESENTATION

The  accompanying  unaudited  condensed  consolidated  financial  statements  of
Ridgestone  Financial  Services,  Inc.  (the  "Company")  have been  prepared in
accordance with generally accepted  accounting  principles for interim financial
information  and with  instructions  to Form  10-QSB.  Accordingly,  they do not
include all of the  information  and  footnotes  required by generally  accepted
accounting  principles  for  complete  financial  statements.  In the opinion of
management,   all  adjustments  (consisting  of  normal  recurring  adjustments)
considered  necessary for the fair  presentation  have been included.  Operating
results  for the nine  months  ended  September  30,  1999  are not  necessarily
indicative  of the results that may be expected for the year ended  December 31,
1999. For further  information,  refer to the consolidated  financial statements
and footnotes thereto included in the Company's Annual Report on Form 10-KSB for
the year ended December 31, 1998.

NOTE 2 - PRINCIPLES OF CONSOLIDATION

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

NOTE 3 - COMPARATIVE DATA

Comparative  statements  of income for the three and nine  months and cash flows
for the nine months ended  September  30, 1999 and  September 30, 1998 have been
presented.

NOTE 4 - STOCK DIVIDEND

On May 21, 1998, the Company paid a 5% stock dividend on issued and  outstanding
shares of its common stock. The dividend totaled 41,717 shares.


                                       -5-

<PAGE>

Item  2.  Management's Discussion and Analysis

General

Ridgestone Financial Services, Inc. (the "Company") was formed in May 1994 under
the laws of the State of Wisconsin  for the purpose of becoming the bank holding
company of Ridgestone Bank (the "Bank").

The Bank was  capitalized  on  December  6, 1995,  and  commenced  operation  on
December 7, 1995.  The Bank was  organized as a Wisconsin  chartered  commercial
bank  with  depository   accounts  insured  by  the  Federal  Deposit  Insurance
Corporation.  The Bank provides  full service  commercial  and consumer  banking
services in Brookfield, Wisconsin, and adjacent communities.

The following is a discussion of the Company's  Financial  Condition and Results
of Operations as of and for the three and nine months ended September 30, 1999.


Financial Condition

Total  Assets.  Total  assets  of the  Company  as of  September  30,  1999 were
$66,175,462  compared to  $71,335,535 as of December 31, 1998, a decrease of 7%.
This decrease in total assets is related to the Company's  efforts to expand its
loan portfolio and control  deposit growth to further  improve  earnings.  While
this strategy has resulted in a decline in total assets, it has also resulted in
an increase in net interest income and an improvement in the Bank's net interest
margin.

Cash and Cash Equivalents.  Cash and interest bearing deposits, which represents
cash  maintained  at the Bank and  funds  that  the  Bank and the  Company  have
deposited in other financial institutions, was $3,876,310 at September 30, 1999,
compared to $2,744,321 as of December 31, 1998. The Bank reported  $1,975,000 of
federal  funds  sold  (which are  inter-bank  funds  with  daily  liquidity)  on
September 30, 1999 compared to $12,525,000 on December 31, 1998. The $10,550,000
decrease  in federal  funds sold is  primarily a result of a decline in deposits
and the use of cash to fund loan growth.

Investment  Securities.  The  Company's  investment  portfolio  consists  of (i)
securities  purchased with the intent to hold the  securities  until they mature
and (ii)  securities  placed in the  available  for sale  category  which may be
liquidated to provide cash for operating or financing  purposes.  The securities
held-to-maturity  portfolio  was  $999,340 at  September  30,  1999  compared to
$1,750,335  at December 31, 1998, a decrease of $750,995,  primarily as a result
of securities  which matured.  The securities  available-for-sale  portfolio was
$1,807,486  at September  30, 1999 compared to $615,284 at December 31, 1998, an
increase of  $1,192,202,  which was primarily due to a  reinvestment  of certain
funds into repurchase agreements.

Loans.  Total  loans  prior to the  allowance  for  estimated  loan  losses were
$52,690,306 as of September 30, 1999, compared to $48,869,077 as of December 31,
1998, an increase of 8%.

At September 30, 1999, the mix of the loan portfolio  included  Commercial loans
of  $11,990,000  or  23%  of  total  loans;  Commercial  Real  Estate  loans  of
$22,182,000 or 42% of total loans;  Residential Real Estate loans of $15,142,000
or 29% of total loans; and Consumer loans of $3,376,000 or 6% of total loans.


                                       -6-

<PAGE>

Allowance for Loan Losses.  The allowance for estimated loan losses was $563,305
or 1.07% of gross loans on September  30, 1999  compared to $562,747 or 1.15% of
gross loans at December  31,  1998.  In  accordance  with  Financial  Accounting
Standards Board ("FASB") Statements No. 5 and 114, the allowance is provided for
losses that have potentially been incurred based on the Bank's  outstanding loan
balance as of the balance  sheet date.  The Bank  evaluates  the adequacy of the
loan loss reserve based on past events and current economic conditions, and does
not include the effects of potential losses on specific loans or groups of loans
that are  related to future  events or expected  changes in economic  conditions
which are then unknown to the Bank.  For  additional  information  regarding the
Company's  allowance for loan losses, see "Results of Operations - Provision for
Loan Losses" below.

In the third  quarter of 1999,  the Bank charged  $11,579  against the loan loss
reserve which related to a consumer loan charge off.

On September  30, 1999,  the Company had  $1,035,215  in Other Real Estate Owned
compared to $1,297,835 on December 31, 1998. This decrease was the result of the
sale of real estate assets owned by the Bank.

Deposits.  As of September 30, 1999, total deposits were $59,090,540 compared to
$64,522,856  at December  31, 1998,  a decrease of 8%. For more  information  on
deposits, see "Total Assets" above.

Liquidity.  For  banks,  liquidity  generally  represents  the  ability  to meet
withdrawals  from  deposits  and the funding of loans.  The assets that  provide
liquidity are cash,  federal  funds sold and  short-term  loans and  securities.
Liquidity  needs are  influenced  by  economic  conditions,  interest  rates and
competition. Management believes the Bank will be able to meet liquidity demands
as the Bank's  loan growth  continues.  The Bank's  loan-to-deposit  funds ratio
prior to loan loss reserve on September 30, 1999 was 89%.

Asset/Liability  Management.  Closely  related to  liquidity  management  is the
management of  interest-earning  assets and  interest-bearing  liabilities.  The
Company  manages  its rate  sensitivity  position  to avoid  wide  swings in net
interest margins and to minimize risk due to changes in interest rates.

Changes in net interest income,  other than volume related  changes,  arise when
interest  rates on assets  reprice in a time frame or interest rate  environment
that is different  from the  repricing  period for  liabilities.  Changes in net
interest  income also arise from changes in the mix of  interest-earning  assets
and interest-bearing liabilities.

The Company currently does not expect to experience any material fluctuations in
its net  interest  income in the  short  term as a  consequence  of  changes  in
interest rates.


Results of Operations

Net Income.  Net income for the  three-month  period  ended  September  30, 1999
increased  by $21,851 to  $122,422  as compared to net income of $100,571 in the
same period of 1998.  For the nine month period ended  September  30, 1999,  the
Company  reported net income of $370,822 which compares  favorably to net income
of $255,081 for the nine months ended  September 30, 1998. A tax benefit related
to a tax loss carryforward  accounted for $94,840 and $290,850 of net income for
the three and nine months ended September 30, 1999, respectively.


                                       -7-

<PAGE>

Net Interest  Income.  Net interest income before  provision for loan losses for
the three and nine months ended  September 30, 1999 was $635,120 and  $1,712,920
compared to $547,606 and $1,476,280 for the same periods in 1998, an improvement
of 16% in each period.  Contributing  to the increase in net interest income was
an overall  lower cost of funds.  The Bank's net interest  margin  improved from
3.27% at September  30, 1998 to 3.70% at  September  30,  1999.  Total  interest
income for the three and nine  months  ended  September  30, 1999  decreased  by
$72,600 and $80,064  respectively,  as compared  with the same  periods in 1998,
while total interest expense decreased by $160,114 and $316,704.

Provision  for  Loan  Losses.   The  provision  for  loan  losses  is  based  on
management's  evaluation  of factors such as the local and national  economy and
the risks associated with the loans in the portfolio.

As a result of increasing  balances in the loan  portfolio and loan  charge-offs
during the nine months  ended  September  30,  1999,  the loan loss reserve as a
percentage of gross loans is slightly below the levels  historically  maintained
by the Bank.  During the nine month period ended  September 30, 1999, a $192,500
provision  was made to the loan loss  reserve to build the  reserve to  adequate
levels.  Management  anticipates  continued  growth  in the loan  portfolio  and
intends to make  additional  provisions  during the fourth quarter of 1999 which
will build the reserve to a higher percentage of gross loans.

Non-Interest Income. Total non-interest income (excluding any gains or losses on
the sale of assets  and  securities)  was  $87,369  for the three  months  ended
September  30, 1999 compared to $66,281 for the same period in 1998, an increase
of $21,088 or 32%. Total  non-interest  income (excluding any gains or losses on
the sale of assets  and  securities)  was  $247,250  for the nine  months  ended
September 30, 1999 compared to $173,981 for the same period in 1998, an increase
of 42%.

Non-Interest Expense. Total non-interest expenses (excluding any gains or losses
on the sale of  securities  and assets) were $555,842 for the three months ended
September 30, 1999 compared to $532,849 for the same period in 1998, an increase
of 4%. Total  non-interest  expenses  (excluding  any gains or losses on sale of
assets and  securities)  were $1,633,474 for the nine months ended September 30,
1999 compared to $1,484,726 for the same period in 1998, an increase of 10% from
the prior period in 1998. The majority of the increase in non-interest  expenses
is attributed to two areas, benefit plans and occupancy expense. The majority of
the benefit  plan  expense is offset by income  related to the benefit  plans in
non-interest  income,  and the increase in occupancy expense is primarily due to
an accounting  change in the treatment of expenses  related to Other Real Estate
Owned.


Year 2000 Impact

Existing computer programs generally recognize dates and perform calculations by
using only the last two digits of any given year.  These  computer  programs may
not  recognize a year that begins  with "20"  instead of "19." As a result,  the
functions  of  computer   software,   hardware  and  embedded  systems  at  many
businesses,  including the Bank,  may experience  failures or produce  incorrect
results  when the  calendar  changes to January 1,  2000.  Systems  failures  or
miscalculations  at the Bank or the Bank's  vendors or  customers  may result in
disruption of operations,  including a failure to process  information  and/or a
reduced likelihood of collecting loan payments on a timely basis.


                                       -8-

<PAGE>

The Bank's Readiness.  To determine whether and to what extent it may experience
disruptions  as a result of the turning of the Year 2000  ("Y2K"),  the Bank has
established   a  committee  to  oversee  the   assessment   process  and  report
periodically  to Bank  management.  The  Bank is  currently  in the  process  of
assessing  (i) the Y2K status of its own internal  systems,  including  computer
equipment  (hardware),   applications   (software),   and  other  electronically
controlled equipment that does not process data (embedded systems); (ii) the Y2K
status of its  customers'  systems;  and (iii)  the Y2K  status of its  vendors'
systems.

Internal  Systems.  The Bank has  completed  testing  or  received  manufacturer
certification  of Y2K compliance  with respect to 100% of its internal  hardware
and embedded  systems.  All such systems  appear to be Y2K  compliant.  The Bank
spent less than $5,000 on testing  these  systems to date and does not expect to
incur  additional  costs in  testing  internal  computer  hardware  or  embedded
systems.

The following  chart displays the current status of the Bank's  mission-critical
software with respect to assessing Y2K compliance.

                               Vendor-
  Internal Mission-critical   certified
    Software Category         Compliant?     Status of Testing/Replacement
--------------------------------------------------------------------------------
Operating systems                 Yes    Testing complete - satisfactory
--------------------------------------------------------------------------------
Banking platform applications     Yes    Testing Phase 1 complete - satisfactory
                                         Testing Phase 2 complete - satisfactory
--------------------------------------------------------------------------------
On-line PC banking                Yes    Testing complete - satisfactory
                                         Implementation - in process
--------------------------------------------------------------------------------
Telephone banking                 Yes    Replacement configuration in process
--------------------------------------------------------------------------------
Loan documentation                Yes    Testing complete - satisfactory
--------------------------------------------------------------------------------
Document management               Yes    Testing complete - satisfactory
--------------------------------------------------------------------------------
Contact management                Yes    Testing complete - satisfactory
--------------------------------------------------------------------------------
General office applications       Yes    Testing complete - satisfactory
--------------------------------------------------------------------------------
Data warehousing                  Yes    Testing complete - satisfactory
--------------------------------------------------------------------------------

All the Bank's internal software systems are vendor-certified compliant and have
been successfully  tested for Y2K compliance.  Portions of the telephone banking
and loan documentation  systems are undergoing final  configuration.  Management
anticipates such configuration will be completed prior to December 31, 1999.

The  platform  banking  system went through a series of tests in May of 1998 and
passed  successfully.  Because of the critical nature of these systems, the Bank
went through a second round of testing of this software in February  1999.  This
test also passed successfully.


                                       -9-

<PAGE>

Customers.  The Bank may  experience  loan  collection  or other  credit-related
problems if significant  customers are not Y2K compliant  before the turn of the
century. In order to assess their Y2K compliance,  the Bank has sent Y2K surveys
to a  majority  of its  commercial  customers.  Many  of  these  customers  have
responded  to the Bank's  inquiries  and continue to update the Bank as new data
becomes  available.  The Bank  intends to continue  surveying  new  customers as
appropriate  to  assess  their Y2K  readiness.  To date,  the Bank has  received
satisfactory  responses  from  most  of  its  major  commercial  customers,  and
management  currently  does not  anticipate  the Bank will  experience  material
adverse effects on operations as a result of customer non-compliance.

Vendors.  Similarly,  the Bank is receiving  regular updates from almost all the
vendors who provide mission- critical products and services.  The Bank is making
efforts to contact those vendors who have not yet provided information regarding
their Y2K readiness.  Of those vendors whose  compliance  status is known to the
Bank,  all are  either  already  compliant  or appear to be making  satisfactory
progress toward compliance.

Y2K  Compliance  Costs.  The  Bank  outsources  a  majority  of its  information
processing,  and its  internal  computer  systems  generally  rely  on  software
provided by third-party  vendors. As a result, the Bank has incurred very little
cost to date, less than $5,000,  in assessing its internal  readiness.  The Bank
will incur additional  remediation  costs which are not expected to be material,
generally  in  connection  with  (i) its  continuing  dialog  with  vendors  and
customers to assess their  readiness,  (ii) the final  configuration  of one new
system,  and (iii) contingency  planning and status updates.  The Bank currently
expects that such additional costs will not exceed $5,000.

Y2K Risks.  One set of Y2K risks to the Bank are  associated  with the potential
non-compliance of its third-party vendors who provide mission-critical services.
Since the Bank  outsources  most of its  information  processing to  third-party
vendors,  such a  failure  could  result in higher  operating  costs,  increased
staffing  needs or the  inability  to  provide  needed  services  to  customers.
Likewise,  the  failure  of  those  vendors  providing  critical  infrastructure
services,  specifically,  power and  communications,  could  result in temporary
operational difficulties at the Bank.

Y2K failures of the Bank's significant  commercial customers could result in the
inability  of those  customers  to make timely  payments  on loans,  potentially
resulting in a loss of revenue,  adjustments  to the Bank's loan loss  reserves,
reduced deposit balances or increased cash requirements.

Another  area of risk to the Bank  lies with  consumer  deposit  behavior.  If a
significant  number  of  customers  were  to  withdraw  substantial  amounts  of
deposits,  the Bank  could  face a  shortage  of liquid  assets.  Management  is
increasing the levels of cash on hand to meet potential demands,  and expects to
be able to meet such cash demands satisfactorily.

The Bank does not anticipate  material failures of its embedded  systems,  since
virtually none of these systems rely on date-based control systems.

Contingency  Plans.  The  Bank has  developed  contingency  plans  to deal  with
potential  business  interruptions  caused by Y2K non-compliance of its vendors,
customers  or internal  systems.  These plans  address a wide range of potential
problems.  The Bank's plan is complete,  but portions of the plan still  require
testing and  validation.  Likewise,  there may be future  changes to the plan as
further developments occur.


                                      -10-

<PAGE>

The Bank's contingency plans address the potential  responses of the Bank in the
event  that Y2K  problems  arise in any of over 35 areas,  ranging  from ATM and
electronic banking systems to core loan,  accounting and general ledger systems.
Depending on the system and the time period  during  which it is  affected,  the
contingency  plans  contemplate  that the Bank may engage  alternate  procedures
and/or alternate  third-party  service providers to restore  functionality.  For
certain mission critical services that the Bank currently outsources,  alternate
service providers may not be available.  In those instances,  however,  the Bank
has  received  assurance  from  those  providers  that  they  are or will be Y2K
compliant.

Although  the Bank has taken  many steps to ensure  that Y2K will not  adversely
impact  its  results  of  operations  or  financial  condition,  there can be no
assurance that it will not have such an effect. Whether the Bank will experience
adverse  effects  as a result of Y2K will  depend on certain  risks and  factors
including risks  associated with (i) Y2K readiness of the vendors who supply the
Bank with critical information  processing,  credit delivery and other services;
(ii) Y2K readiness of the Bank's key commercial  customers;  (iii) unanticipated
expenses associated with ongoing assessment or remediation of potential internal
Y2K  problems  which  could  affect the Bank's  operations;  (iv) the  potential
inadequacy or failure of the testing  procedures  used by the Bank in performing
its internal Y2K assessments; (v) the inaccuracy of Y2K compliance certification
received by the Bank from  certain  outside  vendors  regarding  those  vendors'
systems  which are used by the Bank;  and (vi) the failure of the Bank to design
or  successfully  implement  adequate  contingency  plans  related to  potential
internal  or  external  Y2K  non-compliance,  or  the  failure  of  successfully
implemented  contingency  plans to allow the Bank to continue its  operations in
the ordinary course.


Special Note Regarding Forward-Looking Statements

Certain  matters   discussed  in  this  Quarterly  Report  on  Form  10-QSB  are
"forward-looking  statements"  intended  to qualify  for the safe  harbors  from
liability  established by the Private Securities  Litigation Reform Act of 1995.
These forward-looking statements can generally be identified as such because the
context of the  statement  will  include  words such as the Company  "believes,"
"anticipates,"   "expects,"  or  other  words  of  similar  import.   Similarly,
statements  that  describe the Company's  future plans,  objectives or goals are
also forward-looking  statements. Such forward-looking statements are subject to
certain  risks and  uncertainties  which  could cause  actual  results to differ
materially from those contemplated in the forward-looking statements. Such risks
include, among others: interest rate trends, the general economic climate in the
Company's market area, loan delinquency rates, risks associated with the turning
of the Year  2000,  and  legislative  enactments  or  regulatory  changes  which
adversely  affect the  business  of the Company  and/or the Bank.  Shareholders,
potential  investors  and other  readers are urged to consider  these factors in
evaluating  the  forward-looking   statements.  The  forward-looking  statements
included herein are only made as of the date of this Form 10-QSB and the Company
undertakes no obligation to publicly update such  forward-looking  statements to
reflect subsequent events or circumstances.


                                      -11-

<PAGE>

Item 6.  Exhibits and Reports on Form 8-K

         a.       Exhibits


         27       Financial Data Schedule
                    (EDGAR version only)


         b.       Reports on Form 8-K

                  The Company  did not file a Current  Report on Form 8-K during
                  the quarter ended September 30, 1999.



                                      -12-

<PAGE>

                                   SIGNATURES


          In  accordance  with  the   requirements  of  the  Exchange  Act,  the
registrant  caused  this  report to be signed on its behalf by the  undersigned,
thereunto duly authorized.

                                        RIDGESTONE FINANCIAL SERVICES, INC.


Date:   November 12, 1999               /s/ Paul E. Menzel
      ---------------------             ----------------------------------------
                                        Paul E. Menzel
                                        President


Date:   November 12, 1999               /s/ William R. Hayes
      ---------------------             ----------------------------------------
                                        William R. Hayes
                                        Vice President and Treasurer



                                      -13-

<PAGE>

                                  EXHIBIT INDEX

Exhibit Number

         a.       Exhibits


27       Financial Data Schedule
         (EDGAR version only)



                                      -14-