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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.
20549

FORM 10-Q

(Mark one)



|      |  |                                                   |  | 
|----- |  | ------------------------------------------------- |  | 
|[ x ] |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)  |  | 
|      |  | OF THE SECURITIES EXCHANGE ACT OF 1934            |  | 
|      |  |                                                  
|      |  | For the quarterly period ended March 31, 2006     |  | 
|      |  |                                                  
|      |  | 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 0-18121

MAF BANCORP, INC.

(Exact name of registrant as specified in its charter)



|                                                      |  |                                     
|----------------------------------------------------- |  | ------------------------------------
|Delaware                                              |  | 36-3664868                          
|(State of Incorporation)                              |  | (I.R.S. Employer Identification No.)
|                                                      | 
|55th Street & Holmes Avenue Clarendon Hills, Illinois |  | 60514-1500                          
|(Address of Principal Executive Offices)              |  | (Zip Code)                          







Registrants telephone number: (630) 325-7300

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes  x                    No   ̈

Indicate by check mark
whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act.



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

Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes   ̈                    No  x

The number of shares of common stock outstanding as of May 5, 2006: 33,643,616



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##### Table of Contents

|           |  |                                                                                       |  |     
|---------- |  | ------------------------------------------------------------------------------------- |  | ----
|           |  |                                                                                       |  | Page
|           |  |                                                                                      
|PART I.    |  | FINANCIAL INFORMATION                                                                 |  | 3   
|           |  |                                                                                      
|ITEM 1.    |  | FINANCIAL STATEMENTS                                                                  |  | 3   
|ITEM 1A.   |  | RISK FACTORS                                                                          |  | 13  
|ITEM 2.    |  | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS |  | 13  
|ITEM 3.    |  | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                            |  | 29  
|ITEM 4.    |  | CONTROLS AND PROCEDURES                                                               |  | 29  
|           |  |                                                                                      
|PART II.   |  | OTHER INFORMATION                                                                     |  | 31  
|           |  |                                                                                      
|ITEM 1.    |  | LEGAL PROCEEDINGS                                                                     |  | 31  
|ITEM 2.    |  | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.                          |  | 31  
|ITEM 3.    |  | DEFAULTS UPON SENIOR SECURITIES.                                                      |  | 31  
|ITEM 4.    |  | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.                                  |  | 31  
|ITEM 5.    |  | OTHER INFORMATION.                                                                    |  | 31  
|ITEM 6.    |  | EXHIBITS.                                                                             |  | 31  
|SIGNATURES |  | 32                                                                                   



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##### Table of Contents

Part I.  Financial Information

Item 1.  Financial Statements

MAF BANCORP, INC. AND SUBSIDIARIES

Consolidated Statements of Financial Condition

(Dollars in
thousands)

(Unaudited)



|                                                                                                                                                  |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------- |  | ---------------------- | ---------- | - |  |  |  |  |  | ---------- | - |  | 
|                                                                                                                                                  |  | March 31,      2006 |  | December 31,      2005
|Assets                                                                                                                                            |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|Cash and due from banks                                                                                                                           |  | $                   |  |                        | 137,302    |   |  |  |  |  |  | 183,799    |   |  | 
|Interest-bearing deposits                                                                                                                         |  |                     |  |                        | 42,449     |   |  |  |  |  |  | 38,491     |   |  | 
|Federal funds sold                                                                                                                                |  |                     |  |                        | 89,538     |   |  |  |  |  |  | 23,739     |   |  | 
|                                                                                                                                                  |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|Total cash and cash equivalents                                                                                                                   |  |                     |  |                        | 269,289    |   |  |  |  |  |  | 246,029    |   |  | 
|Investment securities available for sale, at fair value                                                                                           |  |                     |  |                        | 517,712    |   |  |  |  |  |  | 475,152    |   |  | 
|Stock in Federal Home Loan Bank of Chicago, at cost                                                                                               |  |                     |  |                        | 178,286    |   |  |  |  |  |  | 165,663    |   |  | 
|Mortgage-backed securities available for sale, at fair value                                                                                      |  |                     |  |                        | 1,290,935  |   |  |  |  |  |  | 1,313,409  |   |  | 
|Mortgage-backed securities held to maturity (fair value $227,020 and $237,489)                                                                    |  |                     |  |                        | 235,491    |   |  |  |  |  |  | 243,161    |   |  | 
|Loans receivable held for sale                                                                                                                    |  |                     |  |                        | 104,777    |   |  |  |  |  |  | 114,482    |   |  | 
|Loans receivable, net                                                                                                                             |  |                     |  |                        | 8,067,536  |   |  |  |  |  |  | 7,211,237  |   |  | 
|Allowance for loan losses                                                                                                                         |  |                     |  |                        | (41,021    | ) |  |  |  |  |  | (36,495    | ) |  | 
|                                                                                                                                                  |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|Loans receivable, net of allowance for loan losses                                                                                                |  |                     |  |                        | 8,026,515  |   |  |  |  |  |  | 7,174,742  |   |  | 
|                                                                                                                                                  |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|Accrued interest receivable                                                                                                                       |  |                     |  |                        | 49,248     |   |  |  |  |  |  | 44,339     |   |  | 
|Foreclosed real estate                                                                                                                            |  |                     |  |                        | 2,275      |   |  |  |  |  |  | 789        |   |  | 
|Real estate held for development or sale                                                                                                          |  |                     |  |                        | 55,082     |   |  |  |  |  |  | 50,066     |   |  | 
|Premises and equipment, net                                                                                                                       |  |                     |  |                        | 180,401    |   |  |  |  |  |  | 149,312    |   |  | 
|Bank-owned life insurance                                                                                                                         |  |                     |  |                        | 128,688    |   |  |  |  |  |  | 107,253    |   |  | 
|Goodwill                                                                                                                                          |  |                     |  |                        | 388,070    |   |  |  |  |  |  | 304,251    |   |  | 
|Intangibles, net                                                                                                                                  |  |                     |  |                        | 43,324     |   |  |  |  |  |  | 30,171     |   |  | 
|Other assets                                                                                                                                      |  |                     |  |                        | 63,969     |   |  |  |  |  |  | 68,685     |   |  | 
|                                                                                                                                                  |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|Total assets                                                                                                                                      |  | $                   |  |                        | 11,534,062 |   |  |  |  |  |  | 10,487,504 |   |  | 
|                                                                                                                                                  |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|                                                                                                                                                  |  |                     |  |                        |            |  
|Liabilities and Stockholders Equity                                                                                                              |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|                                                                                                                                                  |  |                     |  |                        |            |  
|Liabilities                                                                                                                                       |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|Deposits                                                                                                                                          |  | $                   |  |                        | 6,895,974  |   |  |  |  |  |  | 6,197,503  |   |  | 
|Borrowed funds                                                                                                                                    |  |                     |  |                        | 3,306,934  |   |  |  |  |  |  | 3,057,669  |   |  | 
|Junior subordinated debentures                                                                                                                    |  |                     |  |                        | 67,011     |   |  |  |  |  |  | 67,011     |   |  | 
|Advances by borrowers for taxes and insurance                                                                                                     |  |                     |  |                        | 50,060     |   |  |  |  |  |  | 45,115     |   |  | 
|Accrued expenses and other liabilities                                                                                                            |  |                     |  |                        | 147,779    |   |  |  |  |  |  | 142,027    |   |  | 
|                                                                                                                                                  |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|Total liabilities                                                                                                                                 |  |                     |  |                        | 10,467,758 |   |  |  |  |  |  | 9,509,325  |   |  | 
|                                                                                                                                                  |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|Stockholders equity                                                                                                                              |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|Preferred stock, $.01 par value; authorized 5,000,000 shares; none issued or outstanding                                                          |  |                     |  |                        |           |   |  |  |  |  |  |           |   |  | 
|Common stock, $.01 par value; 80,000,000 shares authorized; 34,499,494 and 33,634,642 shares issued; 33,854,382 and 32,066,721 shares
outstanding |  |                     |  |                        | 345        |   |  |  |  |  |  | 336        |   |  | 
|Additional paid-in capital                                                                                                                        |  |                     |  |                        | 568,191    |   |  |  |  |  |  | 527,131    |   |  | 
|Retained earnings, substantially restricted                                                                                                       |  |                     |  |                        | 550,710    |   |  |  |  |  |  | 537,140    |   |  | 
|Accumulated other comprehensive loss, net of tax                                                                                                  |  |                     |  |                        | (25,134    | ) |  |  |  |  |  | (19,391    | ) |  | 
|Treasury stock, at cost; 645,112 and 1,567,921 shares                                                                                             |  |                     |  |                        | (27,808    | ) |  |  |  |  |  | (67,037    | ) |  | 
|                                                                                                                                                  |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|Total stockholders equity                                                                                                                        |  |                     |  |                        | 1,066,304  |   |  |  |  |  |  | 978,179    |   |  | 
|                                                                                                                                                  |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 
|                                                                                                                                                  |  | $                   |  |                        | 11,534,062 |   |  |  |  |  |  | 10,487,504 |   |  | 
|                                                                                                                                                  |  |                     |  |                        |            |   |  |  |  |  |  |            |   |  | 

See accompanying notes to unaudited consolidated financial statements.



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MAF BANCORP, INC. AND SUBSIDIARIES

Consolidated Statements of Operations

(Dollars in thousands, except per share data)

(Unaudited)



|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|-------------------------------------------------------- |  | ----------------------------- |  | ---- | ---------- | - |  |  |  |  |  | ---------- |  | 
|                                                         |  | Three Months Ended, March 31,
|                                                         |  | 2006                          |  | 2005
|Interest income:                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Loans receivable                                         |  | $                             |  |      | 115,786    |   |  |  |  |  |  | 89,827     |  | 
|Mortgage-backed securities available for sale            |  |                               |  |      | 14,765     |   |  |  |  |  |  | 9,586      |  | 
|Mortgage-backed securities held to maturity              |  |                               |  |      | 2,682      |   |  |  |  |  |  | 3,060      |  | 
|Federal Home Loan Bank of Chicago stock                  |  |                               |  |      | 1,308      |   |  |  |  |  |  | 4,248      |  | 
|Investment securities available for sale                 |  |                               |  |      | 5,650      |   |  |  |  |  |  | 3,765      |  | 
|Interest-bearing deposits and federal funds sold         |  |                               |  |      | 1,324      |   |  |  |  |  |  | 1,038      |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Total interest income                                    |  |                               |  |      | 141,515    |   |  |  |  |  |  | 111,524    |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Interest expense:                                        |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Deposits                                                 |  |                               |  |      | 38,552     |   |  |  |  |  |  | 21,843     |  | 
|Borrowed funds                                           |  |                               |  |      | 34,494     |   |  |  |  |  |  | 22,142     |  | 
|Junior subordinated debentures                           |  |                               |  |      | 1,027      |   |  |  |  |  |  | -          |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Total interest expense                                   |  |                               |  |      | 74,073     |   |  |  |  |  |  | 43,985     |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Net interest income                                      |  |                               |  |      | 67,442     |   |  |  |  |  |  | 67,539     |  | 
|Provision for loan losses                                |  |                               |  |      | 400        |   |  |  |  |  |  | -          |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Net interest income after provision for loan losses      |  |                               |  |      | 67,042     |   |  |  |  |  |  | 67,539     |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Non-interest income:                                     |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Net gain (loss) on sale of:                              |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Loans receivable                                         |  |                               |  |      | 2,980      |   |  |  |  |  |  | 3,876      |  | 
|Investment securities                                    |  |                               |  |      |           |   |  |  |  |  |  | 498        |  | 
|Foreclosed real estate                                   |  |                               |  |      | (43        | ) |  |  |  |  |  | 134        |  | 
|Deposit account service charges                          |  |                               |  |      | 8,722      |   |  |  |  |  |  | 7,646      |  | 
|Other loan fees                                          |  |                               |  |      | 1,916      |   |  |  |  |  |  | 1,140      |  | 
|Bank-owned life insurance                                |  |                               |  |      | 1,494      |   |  |  |  |  |  | 945        |  | 
|Brokerage and insurance commissions                      |  |                               |  |      | 1,507      |   |  |  |  |  |  | 1,158      |  | 
|Loan servicing fees                                      |  |                               |  |      | 785        |   |  |  |  |  |  | 681        |  | 
|Valuation recovery on mortgage servicing rights          |  |                               |  |      |           |   |  |  |  |  |  | 125        |  | 
|Real estate operations                                   |  |                               |  |      | 852        |   |  |  |  |  |  |           |  | 
|Other                                                    |  |                               |  |      | 2,494      |   |  |  |  |  |  | 2,076      |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Total non-interest income                                |  |                               |  |      | 20,707     |   |  |  |  |  |  | 18,279     |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Non-interest expense:                                    |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Compensation and benefits                                |  |                               |  |      | 27,433     |   |  |  |  |  |  | 27,074     |  | 
|Office occupancy and equipment                           |  |                               |  |      | 7,989      |   |  |  |  |  |  | 6,981      |  | 
|Advertising and promotion                                |  |                               |  |      | 1,739      |   |  |  |  |  |  | 2,001      |  | 
|Data processing                                          |  |                               |  |      | 2,666      |   |  |  |  |  |  | 2,044      |  | 
|Amortization of core deposit intangibles                 |  |                               |  |      | 1,016      |   |  |  |  |  |  | 737        |  | 
|Other                                                    |  |                               |  |      | 8,825      |   |  |  |  |  |  | 9,762      |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Total non-interest expense                               |  |                               |  |      | 49,668     |   |  |  |  |  |  | 48,599     |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Income before income taxes                               |  |                               |  |      | 38,081     |   |  |  |  |  |  | 37,219     |  | 
|Income taxes                                             |  |                               |  |      | 13,001     |   |  |  |  |  |  | 13,042     |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Net income                                               |  | $                             |  |      | 25,080     |   |  |  |  |  |  | 24,177     |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|                                                         |  |                               |  |      |            |  
|Basic earnings per share                                 |  |                               |  |      | .75        |   |  |  |  |  |  | .73        |  | 
|Diluted earnings per share                               |  |                               |  |      | .74        |   |  |  |  |  |  | .72        |  | 
|                                                         |  |                               |  |      |            |  
|Average common and common equivalent shares outstanding: |  |                               |  |      |            |   |  |  |  |  |  |            |  | 
|Basic                                                    |  |                               |  |      | 33,377,094 |   |  |  |  |  |  | 32,937,772 |  | 
|Diluted                                                  |  |                               |  |      | 34,018,127 |   |  |  |  |  |  | 33,685,672 |  | 
|                                                         |  |                               |  |      |            |  
|Dividends declared per common share                      |  |                               |  |      | .25        |   |  |  |  |  |  | .23        |  | 
|                                                         |  |                               |  |      |            |   |  |  |  |  |  |            |  | 

See accompanying notes to unaudited consolidated financial statements.



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##### Table of Contents

MAF BANCORP, INC. AND SUBSIDIARIES

Consolidated Statement of Changes in Stockholders Equity

(Dollars in thousands)

(Unaudited)



|                                                                                                                                            |  |                                   |  |                            |  |                  |     |                                   |  |                |  |       |         |  |  |  |  |  |         |   |  |  |  |  |  |  |  |         |   |  |  |  |  |  |         |   |  |  |  |  |  |           |   |  | 
|------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------- |  | -------------------------- |  | ---------------- | --- | --------------------------------- |  | -------------- |  | ----- | ------- |  |  |  |  |  | ------- | - |  |  |  |  |  |  |  | ------- | - |  |  |  |  |  | ------- | - |  |  |  |  |  | --------- | - |  | 
|                                                                                                                                            |  | Three Months Ended March 31, 2006 |  |                            | 
|                                                                                                                                            |  | Commonstock                       |  | Additional paid-in capital |  | Retainedearnings |     | Accumulatedothercomprehensiveloss |  | Treasury Stock |  | Total
|Balance at December 31, 2005                                                                                                                |  |                                   |  | $                          |  |                  | 336 |                                   |  |                |  |       | 527,131 |  |  |  |  |  | 537,140 |   |  |  |  |  |  |  |  | (19,391 | ) |  |  |  |  |  | (67,037 | ) |  |  |  |  |  | 978,179   |   |  | 
|                                                                                                                                            |  |                                   |  |                            |  |                  |     |                                   |  |                |  |       |         |  |  |  |  |  |         |   |  |  |  |  |  |  |  |         |   |  |  |  |  |  |         |   |  |  |  |  |  |           |   |  | 
|Comprehensive income:                                                                                                                       |  |                                   |  |                            |  |                  |     |                                   |  |                |  |       |         |  |  |  |  |  |         |   |  |  |  |  |  |  |  |         |   |  |  |  |  |  |         |   |  |  |  |  |  |           |   |  | 
|Net income                                                                                                                                  |  |                                   |  |                            |  |                  |    |                                   |  |                |  |       |        |  |  |  |  |  | 25,080  |   |  |  |  |  |  |  |  |        |   |  |  |  |  |  |        |   |  |  |  |  |  | 25,080    |   |  | 
|Other comprehensive loss, net of tax:                                                                                                       |  |                                   |  |                            |  |                  |     |                                   |  |                |  |       |         |  |  |  |  |  |         |   |  |  |  |  |  |  |  |         |   |  |  |  |  |  |         |   |  |  |  |  |  |           |   |  | 
|Unrealized loss on available for sale investments during the period                                                                         |  |                                   |  |                            |  |                  |    |                                   |  |                |  |       |        |  |  |  |  |  |        |   |  |  |  |  |  |  |  | (5,743  | ) |  |  |  |  |  |        |   |  |  |  |  |  | (5,743    | ) |  | 
|                                                                                                                                            |  |                                   |  |                            |  |                  |     |                                   |  |                |  |       |         |  |  |  |  |  |         |   |  |  |  |  |  |  |  |         |   |  |  |  |  |  |         |   |  |  |  |  |  |           |   |  | 
|Total comprehensive income                                                                                                                  |  |                                   |  |                            |  |                  |    |                                   |  |                |  |       |        |  |  |  |  |  | 25,080  |   |  |  |  |  |  |  |  | (5,743  | ) |  |  |  |  |  |        |   |  |  |  |  |  | 19,337    |   |  | 
|                                                                                                                                            |  |                                   |  |                            |  |                  |     |                                   |  |                |  |       |         |  |  |  |  |  |         |   |  |  |  |  |  |  |  |         |   |  |  |  |  |  |         |   |  |  |  |  |  |           |   |  | 
|Exercise of 193,233 stock options and reissuance of treasury stock from option exercises and 7,869 shares from restricted stock unit
awards |  |                                   |  |                            |  |                  | 1   |                                   |  |                |  |       | 1,394   |  |  |  |  |  | (2,985  | ) |  |  |  |  |  |  |  |        |   |  |  |  |  |  | 4,866   |   |  |  |  |  |  | 3,276     |   |  | 
|Issuance of 2,343,186 shares for the acquisition of EFC Bancorp and conversion of 168,690 EFC Bancorp stock options .                       |  |                                   |  |                            |  |                  | 8   |                                   |  |                |  |       | 38,905  |  |  |  |  |  |        |   |  |  |  |  |  |  |  |        |   |  |  |  |  |  | 66,138  |   |  |  |  |  |  | 105,051   |   |  | 
|Tax benefits from stock-related compensation                                                                                                |  |                                   |  |                            |  |                  |    |                                   |  |                |  |       | 761     |  |  |  |  |  |        |   |  |  |  |  |  |  |  |        |   |  |  |  |  |  |        |   |  |  |  |  |  | 761       |   |  | 
|Purchase of 738,005 shares of treasury stock                                                                                                |  |                                   |  |                            |  |                  |    |                                   |  |                |  |       |        |  |  |  |  |  |        |   |  |  |  |  |  |  |  |        |   |  |  |  |  |  | (31,775 | ) |  |  |  |  |  | (31,775   | ) |  | 
|Cash dividends declared, $.25 per share                                                                                                     |  |                                   |  |                            |  |                  |    |                                   |  |                |  |       |        |  |  |  |  |  | (8,525  | ) |  |  |  |  |  |  |  |        |   |  |  |  |  |  |        |   |  |  |  |  |  | (8,525    | ) |  | 
|                                                                                                                                            |  |                                   |  |                            |  |                  |     |                                   |  |                |  |       |         |  |  |  |  |  |         |   |  |  |  |  |  |  |  |         |   |  |  |  |  |  |         |   |  |  |  |  |  |           |   |  | 
|Balance at March 31, 2006                                                                                                                   |  |                                   |  | $                          |  |                  | 345 |                                   |  |                |  |       | 568,191 |  |  |  |  |  | 550,710 |   |  |  |  |  |  |  |  | (25,134 | ) |  |  |  |  |  | (27,808 | ) |  |  |  |  |  | 1,066,304 |   |  | 
|                                                                                                                                            |  |                                   |  |                            |  |                  |     |                                   |  |                |  |       |         |  |  |  |  |  |         |   |  |  |  |  |  |  |  |         |   |  |  |  |  |  |         |   |  |  |  |  |  |           |   |  | 



See accompanying notes to unaudited
consolidated financial statements.



5



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##### Table of Contents

MAF BANCORP, INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(Dollars in thousands)

(Unaudited)



|                                                                                  |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|--------------------------------------------------------------------------------- |  | ---------------------------- |  | - |  |  | -------- | ---- |  |  |  |  |  |  |  |  |  | -------- | - |  | 
|                                                                                  |  | Three Months Ended March 31,
|                                                                                  |  | 2006                         |  |   |  |  |          | 2005
|Operating activities:                                                             |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|Net income                                                                        |  |                              |  | $ |  |  | 25,080   |      |  |  |  |  |  |  |  |  |  | 24,177   |   |  | 
|Adjustments to reconcile net income to net cash provided by operating activities: |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|Amortization of premiums, discounts and deferred loan fees                        |  |                              |  |   |  |  | 714      |      |  |  |  |  |  |  |  |  |  | (2,890   | ) |  | 
|Provision for loan losses                                                         |  |                              |  |   |  |  | 400      |      |  |  |  |  |  |  |  |  |  |         |   |  | 
|FHLB of Chicago stock dividends                                                   |  |                              |  |   |  |  |         |      |  |  |  |  |  |  |  |  |  | (4,202   | ) |  | 
|Net gain on sale of loans receivable                                              |  |                              |  |   |  |  | (2,980   | )    |  |  |  |  |  |  |  |  |  | (3,876   | ) |  | 
|Net gain on sale of investment and mortgage-backed securities                     |  |                              |  |   |  |  |         |      |  |  |  |  |  |  |  |  |  | (498     | ) |  | 
|Net gain on real estate held for development or sale                              |  |                              |  |   |  |  | (852     | )    |  |  |  |  |  |  |  |  |  |         |   |  | 
|Amortization and recovery of mortgage servicing rights, net                       |  |                              |  |   |  |  | 1,201    |      |  |  |  |  |  |  |  |  |  | 1,653    |   |  | 
|Depreciation and amortization                                                     |  |                              |  |   |  |  | 4,080    |      |  |  |  |  |  |  |  |  |  | 3,621    |   |  | 
|Amortization of core deposit intangibles                                          |  |                              |  |   |  |  | 1,016    |      |  |  |  |  |  |  |  |  |  | 737      |   |  | 
|Deferred income tax expense (benefit)                                             |  |                              |  |   |  |  | 1,183    |      |  |  |  |  |  |  |  |  |  | (683     | ) |  | 
|Decrease in accrued interest receivable                                           |  |                              |  |   |  |  | (244     | )    |  |  |  |  |  |  |  |  |  | (902     | ) |  | 
|Increase in cash surrender value of bank-owned life insurance                     |  |                              |  |   |  |  | (1,494   | )    |  |  |  |  |  |  |  |  |  | (946     | ) |  | 
|Net decrease in other assets and liabilities, net of effects from acquisitions    |  |                              |  |   |  |  | 3,792    |      |  |  |  |  |  |  |  |  |  | 6,644    |   |  | 
|Tax benefit for stock options exercised                                           |  |                              |  |   |  |  | 761      |      |  |  |  |  |  |  |  |  |  | 58       |   |  | 
|Excess tax benefits realized on exercise of stock compensation                    |  |                              |  |   |  |  | (750     | )    |  |  |  |  |  |  |  |  |  |         |   |  | 
|Loans originated and purchased for sale                                           |  |                              |  |   |  |  | (246,232 | )    |  |  |  |  |  |  |  |  |  | (143,013 | ) |  | 
|Sale of loans originated and purchased for sale                                   |  |                              |  |   |  |  | 258,126  |      |  |  |  |  |  |  |  |  |  | 234,400  |   |  | 
|                                                                                  |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|Net cash provided by operating activities                                         |  |                              |  |   |  |  | 43,801   |      |  |  |  |  |  |  |  |  |  | 114,280  |   |  | 
|                                                                                  |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|                                                                                  |  |                              |  |   |  |  |          |      | 
|Investing activities:                                                             |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|Loans originated and purchased for investment                                     |  |                              |  |   |  |  | (591,563 | )    |  |  |  |  |  |  |  |  |  | (670,099 | ) |  | 
|Principal repayments on loans receivable                                          |  |                              |  |   |  |  | 588,910  |      |  |  |  |  |  |  |  |  |  | 594,677  |   |  | 
|Principal repayments on mortgage-backed securities                                |  |                              |  |   |  |  | 66,542   |      |  |  |  |  |  |  |  |  |  | 61,176   |   |  | 
|Proceeds from maturities of investment securities available for sale              |  |                              |  |   |  |  | 43,749   |      |  |  |  |  |  |  |  |  |  | 4,574    |   |  | 
|Proceeds from sale of:                                                            |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|Investment securities available for sale                                          |  |                              |  |   |  |  | 34,484   |      |  |  |  |  |  |  |  |  |  | 25,506   |   |  | 
|Real estate held for development or sale                                          |  |                              |  |   |  |  | 5,633    |      |  |  |  |  |  |  |  |  |  | 908      |   |  | 
|Stock in Federal Home Loan Bank of Chicago                                        |  |                              |  |   |  |  |         |      |  |  |  |  |  |  |  |  |  | 49,202   |   |  | 
|Purchases of:                                                                     |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|Investment securities available for sale                                          |  |                              |  |   |  |  | (27,145  | )    |  |  |  |  |  |  |  |  |  | (45,000  | ) |  | 
|Mortgage-backed securities available for sale                                     |  |                              |  |   |  |  | (36,237  | )    |  |  |  |  |  |  |  |  |  | (158,899 | ) |  | 
|Real estate held for development or sale                                          |  |                              |  |   |  |  | (9,704   | )    |  |  |  |  |  |  |  |  |  | (3,986   | ) |  | 
|Premises and equipment                                                            |  |                              |  |   |  |  | (4,081   | )    |  |  |  |  |  |  |  |  |  | (2,105   | ) |  | 
|Cash paid for acquisitions, net of cash received                                  |  |                              |  |   |  |  | (46,883  | )    |  |  |  |  |  |  |  |  |  |         |   |  | 
|                                                                                  |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|Net cash provided by (used in) investing activities                               |  |                              |  |   |  |  | 23,705   |      |  |  |  |  |  |  |  |  |  | (144,046 | ) |  | 
|                                                                                  |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|                                                                                  |  |                              |  |   |  |  |          |      | 
|Financing Activities:                                                             |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|Proceeds from:                                                                    |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|FHLB of Chicago advances                                                          |  |                              |  |   |  |  | 620,000  |      |  |  |  |  |  |  |  |  |  | 80,000   |   |  | 
|Unsecured bank term loan                                                          |  |                              |  |   |  |  | 52,000   |      |  |  |  |  |  |  |  |  |  |         |   |  | 
|Unsecured line of credit                                                          |  |                              |  |   |  |  | 10,000   |      |  |  |  |  |  |  |  |  |  | 20,000   |   |  | 
|Reverse repurchase agreements                                                     |  |                              |  |   |  |  | 50,000   |      |  |  |  |  |  |  |  |  |  | 50,000   |   |  | 
|Repayments of:                                                                    |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|FHLB of Chicago advances                                                          |  |                              |  |   |  |  | (625,000 | )    |  |  |  |  |  |  |  |  |  | (171,563 | ) |  | 
|Reverse repurchase agreements                                                     |  |                              |  |   |  |  | (100,000 | )    |  |  |  |  |  |  |  |  |  |         |   |  | 
|Net increase (decrease) in:                                                       |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|Deposits                                                                          |  |                              |  |   |  |  | (3,362   | )    |  |  |  |  |  |  |  |  |  | 79,810   |   |  | 
|Other short-term borrowings                                                       |  |                              |  |   |  |  | (19,505  | )    |  |  |  |  |  |  |  |  |  | (1,097   | ) |  | 
|Advances by borrowers for taxes and insurance                                     |  |                              |  |   |  |  | 2,382    |      |  |  |  |  |  |  |  |  |  | 1,472    |   |  | 
|Proceeds from exercise of stock options                                           |  |                              |  |   |  |  | 7,639    |      |  |  |  |  |  |  |  |  |  | 609      |   |  | 
|Excess tax benefits realized on exercise of stock compensation                    |  |                              |  |   |  |  | 750      |      |  |  |  |  |  |  |  |  |  |         |   |  | 
|Purchase of treasury stock                                                        |  |                              |  |   |  |  | (31,775  | )    |  |  |  |  |  |  |  |  |  | (27,852  | ) |  | 
|Cash dividends paid                                                               |  |                              |  |   |  |  | (7,375   | )    |  |  |  |  |  |  |  |  |  | (6,959   | ) |  | 
|                                                                                  |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 
|Net cash provided by (used in) financing activities                               |  |                              |  |   |  |  | (44,246  | )    |  |  |  |  |  |  |  |  |  | 24,420   |   |  | 
|                                                                                  |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  |          |   |  | 



6



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##### Table of Contents

|                                                                                                                                                 |  |                              |  |   |  |  |           |      |  |  |  |  |  |  |  |  |  |         |   |  | 
|------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---------------------------- |  | - |  |  | --------- | ---- |  |  |  |  |  |  |  |  |  | ------- | - |  | 
|                                                                                                                                                 |  | Three Months Ended March 31,
|                                                                                                                                                 |  | 2006                         |  |   |  |  |           | 2005
|Increase (decrease) in cash and cash equivalents                                                                                                 |  |                              |  |   |  |  | 23,260    |      |  |  |  |  |  |  |  |  |  | (5,346  | ) |  | 
|Cash and cash equivalents at beginning of year                                                                                                   |  |                              |  |   |  |  | 246,029   |      |  |  |  |  |  |  |  |  |  | 246,998 |   |  | 
|                                                                                                                                                 |  |                              |  |   |  |  |           |      |  |  |  |  |  |  |  |  |  |         |   |  | 
|Cash and cash equivalents at end of year                                                                                                         |  |                              |  | $ |  |  | 269,289   |      |  |  |  |  |  |  |  |  |  | 241,652 |   |  | 
|                                                                                                                                                 |  |                              |  |   |  |  |           |      |  |  |  |  |  |  |  |  |  |         |   |  | 
|Supplemental disclosure of cash flow information:                                                                                                |  |                              |  |   |  |  |           |      |  |  |  |  |  |  |  |  |  |         |   |  | 
|Cash paid during the period for:                                                                                                                 |  |                              |  |   |  |  |           |      |  |  |  |  |  |  |  |  |  |         |   |  | 
|Interest on deposits and borrowed funds                                                                                                          |  |                              |  | $ |  |  | 69,397    |      |  |  |  |  |  |  |  |  |  | 39,802  |   |  | 
|Income taxes                                                                                                                                     |  |                              |  |   |  |  | 1,684     |      |  |  |  |  |  |  |  |  |  | 3,449   |   |  | 
|Summary of non-cash transactions:                                                                                                                |  |                              |  |   |  |  |           |      |  |  |  |  |  |  |  |  |  |         |   |  | 
|Transfer of loans receivable to foreclosed real estate                                                                                           |  |                              |  |   |  |  | 1,531     |      |  |  |  |  |  |  |  |  |  | 757     |   |  | 
|Loans receivable swapped into mortgage-backed securities                                                                                         |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  | 40,887  |   |  | 
|Treasury stock received for withholding tax liability related to stock option exercises and restricted stock unit vesting (6,769 and 186
shares) |  |                              |  |   |  |  | 290       |      |  |  |  |  |  |  |  |  |  | 8       |   |  | 
|Treasury stock received for stock option exercises (11,853 and 0 shares)                                                                         |  |                              |  |   |  |  | 508       |      |  |  |  |  |  |  |  |  |  |        |   |  | 
|Transfer of equity lines of credit from loans receivable, net, to loans receivable held for sale                                                 |  |                              |  |   |  |  |          |      |  |  |  |  |  |  |  |  |  | 76,843  |   |  | 
|                                                                                                                                                 |  |                              |  |   |  |  |           |      | 
|Acquisition:                                                                                                                                     |  |                              |  |   |  |  |           |      |  |  |  |  |  |  |  |  |  |         |   |  | 
|Assets acquired                                                                                                                                  |  |                              |  | $ |  |  | 1,052,353 |      |  |  |  |  |  |  |  |  |  |        |   |  | 
|Common stock issued                                                                                                                              |  |                              |  |   |  |  | 100,977   |      |  |  |  |  |  |  |  |  |  |        |   |  | 
|                                                                                                                                                 |  |                              |  |   |  |  |           |      | 
|Cash paid                                                                                                                                        |  |                              |  |   |  |  | (68,350   | )    |  |  |  |  |  |  |  |  |  |        |   |  | 
|Cash acquired                                                                                                                                    |  |                              |  |   |  |  | 21,467    |      |  |  |  |  |  |  |  |  |  |        |   |  | 
|                                                                                                                                                 |  |                              |  |   |  |  |           |      |  |  |  |  |  |  |  |  |  |         |   |  | 
|Net cash paid for acquisitions                                                                                                                   |  |                              |  |   |  |  | (46,883   | )    |  |  |  |  |  |  |  |  |  |        |   |  | 
|                                                                                                                                                 |  |                              |  |   |  |  |           |      |  |  |  |  |  |  |  |  |  |         |   |  | 

See accompanying Notes to Consolidated Financial Statements.



7



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##### Table of Contents

(1) Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements. In our opinion, all adjustments (consisting of only normal
recurring accruals) necessary for a fair presentation have been included. The results of operations for the three months ended March 31, 2006, are not necessarily indicative of results that may be expected for the year ending December 31,
2006.

The consolidated financial statements include the accounts of MAF Bancorp, Inc., or Company, Mid America Bank, fsb including subsidiaries, or
Bank, and MAF Developments, Inc., or MAFD, for the three-month periods ended March 31, 2006 and 2005, and as of March 31, 2006 and December 31, 2005. All material intercompany balances and transactions have been eliminated in
consolidation.

(2) Statement of Cash Flows

For purposes of reporting cash flows, cash and cash equivalents include cash and due from banks, interest-bearing deposits and federal funds sold. Generally, federal funds are sold for one-day periods and interest-bearing
deposits mature within one day to three months.

(3) Reclassifications

Certain reclassifications of 2005 amounts have been made to conform with the current period presentation.

(4) Earnings Per Share

Earnings per share is determined by dividing net income for the period by the weighted average number of shares outstanding. Stock options and
restricted stock units are regarded as potential common stock and are considered in the diluted earnings per share calculations to the extent that they would have a dilutive effect if converted to common stock. Weighted average shares used in
calculating earnings per share are summarized below for the periods indicated:



|                                                                 |  |                                               |  |                     |  |                 |     |                   |           |                     |            |                 |     
|---------------------------------------------------------------- |  | --------------------------------------------- |  | ------------------- |  | --------------- | --- | ----------------- | --------- | ------------------- | ---------- | --------------- | ----
|                                                                 |  | For the Three Months Ended March 31,         
|                                                                 |  | 2006                                          |  | 2005               
|                                                                 |  | Income(Numerator)                             |  | Shares(Denominator) |  | Per ShareAmount |     | Income(Numerator) |           | Shares(Denominator) |            | Per ShareAmount
|                                                                 |  | (Dollars in thousands, except per share data)
|Basic earnings per share:                                        |  |                                               |  |                     |  |                 |     |                   |           |                     |            |                 |     
|Income available to common shareholders                          |  | $  25,080                                     |  | 33,377,094          |  | $               | .75 |                   | $  24,177 |                     | 32,937,772 |                 | $.73
|                                                                 |  |                                               |  |                     |  |                 |     |                   |           |                     |            |                 |     
|Effect of dilutive securities:                                   |  |                                               |  |                     |  |                 |     |                   |           |                     |            |                 |     
|Stock options                                                    |  |                                               |  | 641,033             |  |                 |     |                   |           |                     | 747,900    |                 |     
|                                                                 |  |                                               |  |                     |  |                 |     |                   |           |                     |            |                 |     
|Diluted earnings per share:                                      |  |                                               |  |                     |  |                 |     |                   |           |                     |            |                 |     
|Income available to common shareholders plus assumed conversions |  | $  25,080                                     |  | 34,018,127          |  | $               | .74 |                   | $  24,177 |                     | 33,685,672 |                 | $.72
|                                                                 |  |                                               |  |                     |  |                 |     |                   |           |                     |            |                 |     

(5) Business Combinations

On February 1, 2006, we completed our acquisition of EFC Bancorp, Inc., or EFC, in a cash and stock transaction valued at $176.6 million. We paid $71.6 million in cash, issued 2.34 million shares and assumed EFC stock options. We
funded the cash portion of the merger consideration primarily through a $52 million increase in our unsecured term bank loan. At the time of acquisition, EFC had total assets of approximately $1.1 billion, loans receivable of $865.2 million,
deposits of $703.4 million and borrowings of $258.9 million. The closing of the EFC merger resulted in an overall increase in goodwill and core deposit intangibles of $97.2 million. The merger provided seven additional branch locations in the
Chicago area.

(6) Goodwill and Intangible Assets

Goodwill had a net carrying amount of $388.1 million at March 31, 2006 and $304.3 million at December 31, 2005. The increase in goodwill was due to $83.7 million related to our EFC Bancorp, Inc., or EFC, acquisition in the current
quarter, as well as $139,000 related to a prior acquisition tax adjustment. We evaluate goodwill for impairment at least annually. Our prior evaluation was performed as of May 31, 2005, and no impairment was deemed necessary as a result of our
analysis.



8



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##### Table of Contents

The changes in the net carrying amounts of intangible assets subject to amortization are as follows:



|                             |  |   |                        |                         |        |   |                            |        |   |       |        |  
|---------------------------- |  | - | ---------------------- | ----------------------- | ------ | - | -------------------------- | ------ | - | ----- | ------ | -
|                             |  |   |                        | Core DepositIntangibles |        |   | MortgageServicingRights(1) |        |   | Total |       
|                             |  |   | (Dollars in thousands) |                        
|Balance at December 31, 2005 |  | $ |                        |                         | 10,164 |   |                            | 20,007 |   |       | 30,171 |  
|Additions                    |  |   |                        |                         | 13,478 |   |                            | 1,892  |   |       | 15,370 |  
|Amortization expense         |  |   |                        |                         | (1,016 | ) |                            | (1,201 | ) |       | (2,217 | )
|                             |  |   |                        |                         |        |   |                            |        |   |       |        |  
|Balance at March 31, 2006    |  | $ |                        |                         | 22,626 |   |                            | 20,698 |   |       | 43,324 |  
|                             |  |   |                        |                         |        |   |                            |        |   |       |        |  
|_______________              |  |   |                        |                         |        |   |                            |        |   |       |        |  

| | (1) | Theestimated fair values of mortgage servicing rights at March 31, 2006 and December 31, 2005 were $29.9 million and $29.0 million, respectively.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------

The following is a summary of intangible assets subject to amortization:



|                          |  |                     |                        |                         |                      |   |                     |        |                         |         |  
|------------------------- |  | ------------------- | ---------------------- | ----------------------- | -------------------- | - | ------------------- | ------ | ----------------------- | ------- | -
|                          |  | At March 31, 2006   |                        |                         | At December 31, 2005 |  
|                          |  | GrossCarryingAmount |                        | AccumulatedAmortization |                      |   | GrossCarryingAmount |        | AccumulatedAmortization |        
|                          |  |                     | (Dollars in thousands) |                        
|Core deposit intangibles  |  | $                   | 40,055                 |                         | (17,429              | ) |                     | 26,577 |                         | (16,413 | )
|Mortgage servicing rights |  |                     | 28,577                 |                         | (7,879               | ) |                     | 26,685 |                         | (6,678  | )
|                          |  |                     |                        |                         |                      |   |                     |        |                         |         |  
|Total                     |  | $                   | 68,632                 |                         | (25,308              | ) |                     | 53,262 |                         | (23,091 | )
|                          |  |                     |                        |                         |                      |   |                     |        |                         |         |  

Amortization expense for core deposit intangibles and mortgage servicing rights for the three months ended
March 31, 2006, and estimates for the nine months ending December 31, 2006, and five years thereafter are as follows. These estimates are based on the net carrying amount of our core deposit intangibles and mortgage servicing rights as of
March 31, 2006.



|                                             |  |                        |                        |                         |      
|-------------------------------------------- |  | ---------------------- | ---------------------- | ----------------------- | -----
|                                             |  | CoreDepositIntangibles |                        | MortgageServicingRights
|                                             |  |                        | (Dollars in thousands)
|Aggregate Amortization Expense:              |  |                        |                        |                         |      
|For the three months ended March 31, 2006    |  | $                      | 1,016                  |                         | 1,201
|Estimated Amortization Expense:              |  |                        |                        |                         |      
|For the nine months ending December 31, 2006 |  |                        | 3,300                  |                         | 3,700
|For the year ending December 31, 2007        |  |                        | 3,500                  |                         | 4,100
|For the year ending December 31, 2008        |  |                        | 2,900                  |                         | 3,400
|For the year ending December 31, 2009        |  |                        | 1,200                  |                         | 2,800
|For the year ending December 31, 2010        |  |                        | 1,100                  |                         | 2,400
|For the year ending December 31, 2011        |  |                        | 1,100                  |                         | 2,000

(7) Share-Based Incentive Plans

In July 2003, the MAF Bancorp Incentive Compensation Plan, the Incentive Plan, was adopted and later approved by shareholders in November 2003. All stock option and equity awards are now made under the Incentive Plan. Under the
Incentive Plan, a variety of different types of awards may be granted to directors and employees, including stock options, stock appreciation rights, restricted shares, performance shares, restricted and performance share units, cash awards, awards
under deferred compensation or similar plans, and other incentive awards.

The Incentive Plan provides for the grant of various equity awards,
including incentive and non-qualified stock option awards to employees and directors. Stock options have also been granted to employees and directors under prior stock option plans. Under the plans, options are granted at an exercise price equal to
or greater than the fair market value of the underlying common stock at the date of grant, and may be exercisable for up to 10 years. At exercise, we issue treasury shares to satisfy stock option exercises, as available. Our shareholders have
approved all stock option plans. We recorded expense in the current quarter of $1,578 related to 500 options that remain subject to vesting and will become fully vested in December 2006.

We have also granted restricted stock units, or RSUs, to employees. An RSU award entitles the recipient to receive a like number of shares of our stock on certain
designated vesting dates, assuming their employment is still active as of such dates. RSUs granted in 2005 vest ratably over a three-year period while RSUs granted in 2004 and 2003 vest on various dates during a period that ends five years from the
date of grant. At the date of vesting, shares of common stock are issued to the employee. We expense the fair market value of RSUs, determined as of the date of grant, ratably over the vesting period and this expense totaled $112,166 and $99,361 for
the three-month period ended March 31, 2006 and 2005, respectively.



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Prior to January 1, 2006, we elected to apply Accounting Principles Board, or APB, No. 25 and related
interpretations under SFAS No. 123 Accounting for Stock-Based Compensation and SFAS No. 148 Accounting for Stock-Based Compensation  Transition and Disclosure. Pursuant to the guidance in these pronouncements,
we did not record compensation expense under our plans related to stock options.

On January 1, 2006, we adopted Statement of Financial
Accounting Standards, or SFAS, No. 123R, Share-Based Payments. SFAS No. 123R requires us to recognize compensation expense in an amount equal to the fair value of all share-based payments. We elected to apply SFAS 123R on a
modified prospective method, which requires us to record compensation expense for newly granted options and over the remaining vesting period for previous awards that were fully or partially unvested as of the date of adoption of SFAS No. 123R.
Also, under the modified prospective method, the financial statements for prior periods do not reflect any adjusted amounts. We utilize the Black-Scholes option-pricing model in determining the impact to our net income and earnings per share.

In connection with stock options exercised during the first quarter of 2006, we received $3.2 million of cash from the exercise of the options. In
addition, we realized $761,000 in tax benefit from these exercises. Participants in the stock option plans realized an intrinsic value of $4.5 million from the exercise of these options during the first quarter 2006.

In 2004 and 2005, stock options were immediately vested and therefore there is no associated compensation expense to be recorded. Historically, a portion of
directors and executive officers compensation has consisted of stock option awards. A summary of the status of our unvested stock options as of March 31, 2006, and changes during the quarter ended March 31, 2006, is presented below:



|                                      |  |                  |  |                                          |      
|------------------------------------- |  | ---------------- |  | ---------------------------------------- | -----
|                                      |  | Number ofOptions |  | Weightedaverage grant-date fair value($)
|Unvested options at December 31, 2005 |  | 500              |  | $                                        | 42.07
|Granted                               |  |                 |  |                                          |     
|Vested                                |  |                 |  |                                          |     
|Forfeited                             |  |                 |  |                                          |     
|                                      |  |                  |  |                                          |      
|Unvested options at March 31, 2006    |  | 500              |  |                                          | 42.07
|                                      |  |                  |  |                                          |      

The total compensation cost related to nonvested stock options that have not yet been recognized totaled
$4,734 and the weighted average period which these costs are expected to be recognized is nine months. The weighted average life of the unvested stock options was 8.21 years.

A summary of activity under our share-based incentive plans for the quarter ended March 31, 2006, is as follows:



|                                          |  |                  |   |  |                              |       |                                                    |      |                                          |       
|----------------------------------------- |  | ---------------- | - |  | ---------------------------- | ----- | -------------------------------------------------- | ---- | ---------------------------------------- | ------
|                                          |  | Number ofoptions |   |  | Weightedaverageexerciseprice |       | Weightedaverageremainingcontractualterm (in years) |      | Aggregateintrinsicvalue(1)(in thousands)
|Options outstanding at December 31, 2005  |  | 3,376,104        |   |  | $                            | 32.75 |                                                    |      |                                          |       
|Plus:                                     |  |                  |   |  |                              |       |                                                    |      |                                          |       
|Options granted                           |  |                 |   |  |                              |      |                                                    |      |                                          |       
|Conversion of EFC options to MAFB options |  | 168,690          |   |  |                              | 18.97 |                                                    |      |                                          |       
|Less:                                     |  |                  |   |  |                              |       |                                                    |      |                                          |       
|Options exercised                         |  | (193,233         | ) |  |                              | 19.31 |                                                    |      |                                          |       
|Options cancelled or expired              |  | (2,000           | ) |  |                              | 31.88 |                                                    |      |                                          |       
|                                          |  |                  |   |  |                              |       |                                                    |      |                                          |       
|Options outstanding at March 31, 2006     |  | 3,349,561        |   |  |                              | 32.83 |                                                    | 6.00 |                                          | 36,683
|                                          |  |                  |   |  |                              |       |                                                    |      |                                          |       
|Options exercisable at March 31, 2006     |  | 3,349,061        |   |  |                              | 32.83 |                                                    | 6.00 |                                          | 36,661
|                                          |  |                  |   |  |                              |       |                                                    |      |                                          |       



|                                      |  |               |   |  |                                     |       |                                       |      |                                          |   |      
|------------------------------------- |  | ------------- | - |  | ----------------------------------- | ----- | ------------------------------------- | ---- | ---------------------------------------- | - | -----
|                                      |  | Number ofRSUs |   |  | Weightedaveragegrant datefair value |       | Weightedaverageterm tovest (in years) |      | Aggregateintrinsicvalue(3)(in thousands)
|RSUs outstanding at December 31, 2005 |  | 43,398        |   |  | $                                   | 43.69 |                                       |      |                                          |   |      
|Plus: RSUs granted                    |  | 1,300         |   |  |                                     | 43.86 |                                       |      |                                          |   |      
|Less:                                 |  |               |   |  |                                     |       |                                       |      |                                          |   |      
|RSUs vested                           |  | (4,240        | ) |  |                                     | 44.74 |                                       |      |                                          |   |      
|RSUs cancelled                        |  | (1,638        | ) |  |                                     | 43.57 |                                       |      |                                          |   |      
|                                      |  |               |   |  |                                     |       |                                       |      |                                          |   |      
|RSUs outstanding at March 31, 2006(2) |  | 38,820        |   |  |                                     | 43.58 |                                       | 2.05 |                                          | $ | 1,699
|                                      |  |               |   |  |                                     |       |                                       |      |                                          |   |      

---

|(1) | Intrinsic value represents the difference in the weighted average exercise price and the market price of the
options exercisable at period end.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The end of period balances consist only of unvested shares.
|--- | -----------------------------------------------------------

|(3) | RSU intrinsic value represents the market price of the outstanding units at period end.
|--- | ---------------------------------------------------------------------------------------



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There remain available 163,206 shares for grant of share-based awards under the Incentive Plan.

Awards granted and vested prior to our implementation of SFAS No. 123R were accounted for under APB 25 and related interpretations. Accordingly, no
stock-based employee compensation expense is reflected in the calculation of net income in the Consolidated Statements of Operations for the period ending March 31, 2005, as all options granted had exercise prices equal to the market value of
the underlying common stock on the date of grant. Pro forma net income and net income per share, as if we had applied SFAS No. 123R to stock-based compensation for periods presented prior to our adoption, are as follows:



|                                                                                                                                            |  |                                                                               |  |       
|------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------- |  | ------
|                                                                                                                                            |  | For the three monthsended March 31, 2005 (in thousands, exceptper share data)
|Net income, as reported                                                                                                                     |  | $                                                                             |  | 24,177
|Deduct: total stock option employee compensationexpense determined using the Black-Scholesmethod for all awards, net of related tax
effects |  |                                                                               |  | 528   
|                                                                                                                                            |  |                                                                               |  |       
|Pro-forma net income                                                                                                                        |  | $                                                                             |  | 23,649
|                                                                                                                                            |  |                                                                               |  |       
|                                                                                                                                            |  |                                                                              
|Basic Earnings per Share                                                                                                                    |  |                                                                               |  |       
|As Reported                                                                                                                                 |  | $                                                                             |  | .73   
|                                                                                                                                            |  |                                                                               |  |       
|Pro-forma                                                                                                                                   |  |                                                                               |  | .72   
|                                                                                                                                            |  |                                                                               |  |       
|Diluted Earnings Per Share                                                                                                                  |  |                                                                               |  |       
|As Reported                                                                                                                                 |  |                                                                               |  | .72   
|                                                                                                                                            |  |                                                                               |  |       
|Pro-forma                                                                                                                                   |  |                                                                               |  | .72   
|                                                                                                                                            |  |                                                                               |  |       

(8) Post-Retirement Plans

We sponsor a supplemental executive retirement plan, or SERP, for the purpose of providing certain retirement benefits to executive officers and other corporate officers approved by the Board of Directors. We also sponsor a partially
subsidized group long term medical plan for the purpose of providing certain former employees post-retirement medical benefits. The benefits under the SERP and long-term medical plan are not pre-funded and there are no plan assets. Benefits are
funded on a pay-as-you-go basis. The group long-term medical plan was amended January 1, 2005, to eliminate the retiree subsidy for all non-retired participants effective January 1, 2006. Employees who retired prior to 2006 are
grandfathered and depending on years of service, up to 40% of the premium and projected claim costs continue to be subsidized.

The components of the net periodic
benefit cost to our post-retirement plans are as follows:



|                                                |  |                                      |  |                        |     |      |     |  |      |   |  |     |  
|----------------------------------------------- |  | ------------------------------------ |  | ---------------------- | --- | ---- | --- |  | ---- | - |  | --- | -
|                                                |  | For the Three Months Ended March 31, | 
|                                                |  | SERP                                 |  | Long-term medical plan |    
|                                                |  | 2006                                 |  | 2005                   |     | 2006 |     |  | 2005 |  
|                                                |  | (Dollars in thousands)               | 
|Service cost                                    |  | $                                    |  |                        | 233 |      | 204 |  |     |   |  |    |  
|Interest cost                                   |  |                                      |  |                        | 114 |      | 96  |  | 6    |   |  | 8   |  
|Amortization of unrecognized prior service cost |  |                                      |  |                        |    |      |    |  | 15   |   |  | 11  |  
|Amortization of unrecognized net loss           |  |                                      |  |                        | 18  |      | 13  |  | (29  | ) |  | (29 | )
|                                                |  |                                      |  |                        |     |      |     |  |      |   |  |     |  
|Net periodic benefit cost                       |  | $                                    |  |                        | 365 |      | 313 |  | (8   | ) |  | (10 | )
|                                                |  |                                      |  |                        |     |      |     |  |      |   |  |     |  

(9) Commitments and Contingencies

At March 31, 2006, we had outstanding commitments to originate and fund loans of $822.6 million, including $248.2 million of fixed-rate loans and $449.0 million of primarily hybrid adjustable-rate loans with initial
fixed-rate terms of 3, 5 or 7 years and $125.4 million of home equity lines of credit. Prospective borrowers had locked the interest rate on $150.4 million of these commitments, of which $59.1 million were fixed-rate mortgage or equity loans, with
rates ranging from 5% to 11.375%, and $91.3 million were adjustable rate loans with rates ranging from 3.5% to 13.125%. The interest rates on the remaining commitments of $672.2 million float at current market rates. Included in the outstanding
commitments were $120.9 million of business banking loans. In addition, at March 31, 2006, we had outstanding forward commitments to sell $134.8 million of mortgage and equity loans of which $68.7 million relate to loans held for sale and $66.1
million are unfunded as of March 31, 2006.



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At March 31, 2006, we had outstanding standby letters of credit, excluding those related to our own land
development projects, totaling $99.9 million. Of this amount, $13.1 million is comprised of letters of credit to enhance industrial revenue bond financings of commercial real estate in our market. Additionally, we had outstanding standby letters of
credit totaling $22.1 million related to our real estate development projects.

We could face potential loss equal to the contractual amounts of
contingent credit-related financial instruments such as commitments to extend credit, and letters of credit, if the loans are actually originated or the contracts are fully drawn upon, and the customers default and the value of any existing
collateral becomes worthless.

At March 31, 2006, we had $14.3 million of credit risk related to loans sold to the Federal Home Loan Bank
Mortgage Partnership Finance Program, or MPF, $32.9 million of loans sold with recourse to other investors, and approximately $32.2 million of credit risk related to loans with private mortgage insurance in force in the Banks captive
reinsurance subsidiary. There are no expected losses and no recorded liabilities at March 31, 2006 for such exposure.

(10) Segment Information

We utilize the management approach for segment reporting. This approach is based on the way that we organize lines of business for
making operating decisions and assessing performance. Currently, we have two segments. The Banking segment includes our lending and deposit gathering operations as well as other financial services we offer to individual and business customers. The
business of our Real Estate Operations segment primarily involves land acquisitions, obtaining necessary zoning and regulatory approvals and improving raw land into developed residential lots for sale to builders. All goodwill has been allocated to
the Banking segment. Selected segment information is included in the table below:



|                                  |  |                              |  |                       |            |  |                   |   |         |            |                       |           |  |                   |   |  |          
|--------------------------------- |  | ---------------------------- |  | --------------------- | ---------- |  | ----------------- | - | ------- | ---------- | --------------------- | --------- |  | ----------------- | - |  | ---------
|                                  |  | Three Months Ended March 31,
|                                  |  | 2006                         |  | 2005                 
|                                  |  | Banking                      |  | Real EstateOperations |            |  | ConsolidatedTotal |   | Banking |            | Real EstateOperations |           |  | ConsolidatedTotal
|                                  |  | (Dollars in thousands)      
|Interest income                   |  | $                            |  |                       | 141,515    |  |                  |   |         | 141,515    |                       | 111,524   |  |                  |   |  | 111,524  
|Interest expense                  |  |                              |  |                       | 74,001     |  | 72                |   |         | 74,073     |                       | 44,017    |  | (32               | ) |  | 43,985   
|                                  |  |                              |  |                       |            |  |                   |   |         |            |                       |           |  |                   |   |  |          
|Net interest income               |  |                              |  |                       | 67,514     |  | (72               | ) |         | 67,442     |                       | 67,507    |  | 32                |   |  | 67,539   
|Provision for loan losses         |  |                              |  |                       | 400        |  |                  |   |         | 400        |                       |          |  |                  |   |  |         
|Non-interest income               |  |                              |  |                       | 19,855     |  | 852               |   |         | 20,707     |                       | 18,279    |  |                  |   |  | 18,279   
|Non-interest expense              |  |                              |  |                       | 45,253     |  | 336               |   |         | 45,589     |                       | 44,595    |  | 442               |   |  | 45,037   
|Depreciation expense              |  |                              |  |                       | 4,064      |  | 15                |   |         | 4,079      |                       | 3,540     |  | 22                |   |  | 3,562    
|                                  |  |                              |  |                       |            |  |                   |   |         |            |                       |           |  |                   |   |  |          
|Income (loss) before income taxes |  |                              |  |                       | 37,652     |  | 429               |   |         | 38,081     |                       | 37,651    |  | (432              | ) |  | 37,219   
|Income tax expense (benefit)      |  |                              |  |                       | 12,831     |  | 170               |   |         | 13,001     |                       | 13,249    |  | (207              | ) |  | 13,042   
|                                  |  |                              |  |                       |            |  |                   |   |         |            |                       |           |  |                   |   |  |          
|Net income (loss)                 |  | $                            |  |                       | 24,821     |  | 259               |   |         | 25,080     |                       | 24,402    |  | (225              | ) |  | 24,177   
|                                  |  |                              |  |                       |            |  |                   |   |         |            |                       |           |  |                   |   |  |          
|Average assets                    |  | $                            |  |                       | 11,080,951 |  | 68,352            |   |         | 11,149,303 |                       | 9,620,001 |  | 38,496            |   |  | 9,658,497
|                                  |  |                              |  |                       |            |  |                   |   |         |            |                       |           |  |                   |   |  |          

(11) New Accounting Pronouncements

Accounting for Servicing of Financial Assets.In March 2006, the Financial Accounting Standards Board, FASB, issued Statement of Financial Accounting Standards No. 156, Accounting for Servicing of Financial
Assets  an amendment to FASB Statement No. 140. The new standard requires an entity to recognize servicing assets each time it undertakes an obligation to service a financial asset when 1) entering into a servicing contract when a
transfer of assets meets the requirements for sale accounting, 2) the transfer is to a special purpose entity in a guaranteed mortgage securitization and the transferor retains the securitized asset, or 3) is an acquisition or assumption of an
obligation to service a financial asset not related to the servicer or its consolidated affiliates. The servicing assets and liabilities must be measured at fair value initially, if practicable, and the assets or liabilities must either be amortized
or recorded at fair value at each reporting date. The statement allows a one-time reclassification for entities with servicing rights and subsequently requires separate presentation of servicing assets and liabilities at fair value in the statement
of financial position. This statement is effective for the first fiscal year beginning after September 15, 2006, with earlier adoption permitted. We intend to adopt this pronouncement January 1, 2007, and we do not expect this
implementation to have a material effect on our financial results.

Accounting for Certain Hybrid Financial Instruments  an amendment of
FASB Statements No. 133 and 140.In February 2006, FASB issued SFAS No. 155, Accounting for Certain Hybrid Financial Instruments  an amendment of FASB No. 133 and 140, which is effective for fiscal years
beginning after September 15, 2006.



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The statement was issued to clarify the application of SFAS No. 133 to beneficial interests in securitized financial assets
and to improve the consistency of accounting for similar financial instruments, regardless of the form of the instruments.We do not expect this implementation to have a material effect on our financial results.

Other-Than-Temporary Impairment. FASB Staff Position on SFAS No. 115-1 and SFAS No. 124-1, or the FSP, The Meaning of
Other-Than-Temporary Impairment and Its Application to Certain Investments, was issued in November 2005 and addresses the determination of when an investment is considered impaired, whether the impairment on an investment is
other-than-temporary and how to measure an impairment loss. The FSP also addresses accounting considerations subsequent to the recognition of other-than-temporary impairments on a debt security, and requires certain disclosures about unrealized
losses that have not been recognized as other-than-temporary impairments. The FSP replaces the impairment guidance on Emerging Issues Task Force (EITF) Issue No. 03-1 with references to existing authoritative literature concerning
other-than-temporary determinations. Under the FSP, losses arising from impairment deemed to be other-than-temporary, must be recognized in earnings at an amount equal to the entire difference between the securities cost and its fair value at the
financial statement date, without considering partial recoveries subsequent to that date. The FSP also requires that an investor recognize other-than-temporary impairment losses when a decision to sell a security has been made and the investor does
not expect the fair value of the security to fully recover prior to the expected time of sale. The FSP was effective for reporting periods beginning after December 15, 2005. The initial adoption of this statement did not have a material effect
on our financial results.

Accounting Changes and Error Corrections. In May 2005, the FASB issued Statement No. 154, Accounting
Changes and Error Corrections, which provides guidance on the accounting for and reporting of accounting changes and error corrections. It establishes, unless impracticable, retrospective application as the required method for reporting a
change in accounting principle in the absence of explicit transition requirements specific to the newly adopted accounting principle. The reporting of a correction of an error by restating previously issued financial statements is also addressed by
this statement. This statement became effective, on a prospective basis, for fiscal years beginning after December 15, 2005. This implementation did not have a material affect on our financial results.

Accounting for Certain Loans or Debt Securities Acquired in a Transfer. In December 2003, the Accounting Standards Executive Committee of the American
Institute of Certified Public Accountants issued AICPA Statement of Position No. 03-3,  Accounting for Certain Loans or Debt Securities Acquired in a Transfer (SOP 03-3). SOP 03-3 was issued to address accounting for
differences between the contractual cash flows and the cash flows expected to be collected of certain loans and debt securities (structured as loans) when acquired in a transfer, if those differences are attributable, at least in part, to credit
quality. As such, SOP 03-3 applies to such loans and debt securities acquired in purchase business combinations and does not apply to originated loans. The application of SOP 03-3 could reduce the interest income that is recognized for certain loans
and debt securities by requiring that acquired loans and debt securities be recorded at their fair value defined as the present value of future cash flows net of expected credit losses. As a result, an allowance for loan losses would not be
recognized at acquisition for those loans that qualify under the scope of SOP 03-3. Subsequent to the initial acquisition, increases in expected cash flows generally would be recognized prospectively through adjustment of the yield on the loan or
debt security over its remaining life. Decreases in expected cash flows would be recognized as impairment. SOP 03-3 was effective for loans and debt securities acquired in fiscal years beginning after December 15, 2004, with early application
encouraged. We adopted the statement in 2005 and applied this SOP for the EFC acquisition in the first quarter of 2006, which did not have a material affect on our financial results.

Item 1A. Risk Factors

Not applicable.

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

Cautionary Statement
Regarding Forward-Looking Information

This report, in Item 2. Managements Discussion and Analysis of Financial Condition
and Results of Operations and elsewhere, contains, and other periodic reports and press releases of the Company may contain, forward-looking statements (within the meaning of Section 21E of the Securities Exchange Act of 1934, as
amended), which involve significant risks and uncertainties. The Company intends such forward-



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##### Table of Contents

looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995, and is including this statement for purposes of invoking these safe harbor provisions. These forward-looking statements, which are based on certain assumptions and describe future plans, strategies and expectations of
the Company, are generally identifiable by use of the words believe, expect, intend, anticipate, estimate, project, plan, or similar expressions. The Companys
ability to predict results or the actual effect of future plans or strategies is inherently uncertain and actual results may differ from those predicted. The Company undertakes no obligation to update these forward-looking statements in the future.

Factors which could have a material adverse effect on operations and could affect managements outlook or future prospects of the Company and
its subsidiaries include, but are not limited to, unanticipated changes in interest rates or further flattening or inversion of the yield curve, unanticipated changes in secondary mortgage market conditions, deposit flows, competition, adverse
federal or state legislative or regulatory developments, higher than expected compliance costs, changes in economic conditions which result in increased delinquencies in the Companys loan portfolio, the quality or composition of the
Companys loan or investment portfolios, demand for loan products, financial services and residential real estate in the Companys market areas, delays in our real estate development project, difficulties relating to the integration of the
EFC acquisition and the possible short-term dilutive effect of the EFC acquisition or other potential acquisitions, if any, and changes in accounting principles, policies and guidelines. These risks and uncertainties should be considered in
evaluating forward-looking statements and undue reliance should not be placed on such statements.

General

MAF Bancorp, Inc. was incorporated under the laws of the state of Delaware in 1989, as the holding company for Mid America Bank, fsb (Bank), our
banking subsidiary. The Bank, which was organized as a mutual savings and loan association and has been operating in the Chicago area since 1922, formed the holding company in connection with its conversion from a mutual to stock savings
institution. Today, our bank is one of the largest community-oriented financial institutions headquartered in Chicago. Our primary business focus is providing financial services to retail and business banking customers in the Chicago and Milwaukee
metropolitan area. Our strategy is to continue to grow our banking franchise through organic growth, selective acquisition and branch expansion. We also engage in residential real estate land development through our subsidiary, MAF Developments,
Inc., or MAFD, a business we started in 1974.

We currently operate a total of 82 branches in Illinois and southeastern Wisconsin, 58 branches
located in residential neighborhoods of the city of Chicago and throughout suburban communities in the Chicago metropolitan area, and 24 branches in the Milwaukee area that operate under the name of St. Francis Bank, a division of Mid America Bank,
fsb. Since March 31, 2005, we added seven Illinois branches through our acquisition of EFC which closed in February 2006. We also opened three new branches in the suburban Chicago and Milwaukee communities during the past year.

On February 1, 2006, we completed our acquisition of EFC in a cash and stock transaction valued at $176.6 million, paying $71.6 million in cash, issuing
2.34 million shares and assuming EFC stock options. We funded the cash portion of the merger consideration primarily through a $52 million increase in our unsecured term bank loan. At the time of acquisition, EFC had total assets of
approximately $1.1 billion, loans receivable of $865.2 million, deposits of $703.4 million and borrowings of $258.9 million. The closing of the EFC merger resulted in an overall increase in goodwill and core deposit intangibles of $97.2 million. As
a result of the merger, we have expanded our Chicago area footprint with the addition of seven banking offices in northwest suburban Kane and Cook counties which operate under the Mid America Bank name. The data processing systems conversion was
completed in mid-February 2006, although we do not expect to fully realize operational efficiency improvements until the second quarter of 2006. We do not expect the transaction to materially impact 2006 earnings per share results.

We expect to continue to evaluate potential acquisition opportunities that could enhance franchise value and may periodically be presented with opportunities to
acquire other institutions, branches or deposits in the Chicago or Milwaukee metropolitan areas or opportunities which allow us to expand outside our current primary market areas, as we have done in recent years. We intend to review acquisition
opportunities across a variety of parameters, including the potential impact on our financial condition as well our financial performance in the future. We anticipate acquisitions could involve some tangible book value per share dilution and may
involve short-term earnings per share dilution depending on our timing and success in



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integrating the operations of businesses acquired and the level of cost savings and revenue enhancements that may be achieved.

Critical Accounting Policies and Estimates

Our financial
condition and results of operations included here are prepared in conformity with U.S. generally accepted accounting principles, and are more fully described in Note 1 of the consolidated financial statements found in our Form 10-K for the fiscal
year ended December 31, 2005, in Item 8. Financial Statements and Supplementary Data. The preparation of these consolidated financial statements requires that we make estimates and assumptions that affect the reported amounts of
assets, liabilities, income and expense, as well as related disclosures of contingencies. Our judgment is based on historical experience, terms of existing contracts, market trends, and other information available. We believe that of significant
accounting policies, the following involve a higher degree of judgment and complexity:

Allowance for loan losses. We maintain an
allowance for loan losses to cover managements estimate of probable losses inherent in the Banks loan portfolio. In evaluating the allowance for loan losses and determining the amount of any provision for loan losses, management
considers: (1) historical loss experience and the change in the mix of the overall portfolio composition over the last five years, (2) specific allocations based upon probable losses identified during the review of the portfolio,
(3) delinquency in the portfolio and the composition of non-performing loans, including the percent of non-performing loans with supplemental mortgage insurance, and (4) subjective factors, including local and general economic business
factors and trends, portfolio concentrations and changes in the size and/or general terms of the loan portfolio. The allowance for loan losses is established through a provision for loan losses that is recorded in the consolidated statement of
operations.

Valuation of mortgage servicing rights.We capitalize the value of mortgage servicing rights upon the sale of
loans. We determine the initial value by allocating the previous carrying amount of the sold loans based on the relative fair values of the servicing rights retained and the loans that are sold to a third party. The estimated value takes into
consideration contractually known amounts, such as loan balance, term, contract rate, and whether the customer escrows funds with the Bank for the payment of taxes and insurance. The estimated value is also affected by additional assumptions
relating to loan prepayment speeds, earnings on escrow funds, as well as the discount rate used to present value the estimated future cash flow stream. Subsequent to the establishment of this asset, management reviews the fair value of mortgage
servicing rights quarterly on a disaggregated basis using current estimates of prepayment speed, cash flow and discount rates. Changes in these estimates impact fair value, and could require us to record a valuation allowance or recovery. A recovery
of previously written down servicing rights of $125,000 was recorded in the first quarter of 2005, due to lower prepayment estimates, reflective of a rising rate environment. There was no impairment reserve for mortgage servicing rights at
March 31, 2006. Should estimates assumed by management regarding future prepayment speeds on the underlying loans supporting the mortgage servicing rights prove to be incorrect, additional valuation allowances could occur, or contrarily,
valuation allowances could be recovered if changing estimates increase the fair value of mortgage servicing rights.

Valuation of goodwill and
intangible assets.In accounting for acquisitions of other companies, we generally record as assets on our financial statements both goodwill and identifiable intangible assets such as core deposit intangibles. The amounts we record
are based on our estimates of the fair value of assets and liabilities acquired. The valuation techniques we use to determine the carrying value of tangible and intangible assets and liabilities acquired in acquisitions and the estimated lives of
the identifiable intangible assets involve a number of subjective judgments such as estimates for discount rates, projected future cash flows and an estimate of useful lives, all of which are susceptible to change based on changes in economic
conditions and other factors. Core deposit and other identifiable intangible assets are amortized to expense over their estimated useful lives and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
amount of the asset exceeds the remaining value we are reasonably likely to realize. Similarly, on an annual basis we evaluate whether the carrying value of our goodwill has become impaired, in which case we reduce its carrying value through a
charge to our earnings. Goodwill is evaluated for impairment at the segment reporting level, and all of our goodwill is recorded in our banking segment.

While we believe the assumptions and estimates we used are reasonable, using different assumptions or estimates for these valuations would have resulted in our recording different amounts of goodwill and core deposit intangibles and related
amortization expense. For example, if we had assumed faster prepayment speeds of mortgage loans we acquired in an acquisition, the value of those mortgage loans we acquired may have been less and the goodwill we recorded may have been greater.
Similarly, if we had assumed greater deposit run off rates, we may have recorded lower core deposit intangibles, but might have shortened our



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estimate of the average life of this intangible asset and may have increased our amortization expense in the current period. Any
changes in the assumptions and estimates which we use in future periods to determine the carrying value of our goodwill and identifiable intangible assets, which adversely affect their value or shortens estimated lives, would adversely affect our
results of operations. At March 31, 2006, our goodwill was $388.1 million and our identifiable intangible assets (core deposits) amounted to $22.6 million. We recorded $1.0 million and $737,000 of amortization of core deposit intangibles during
the first three months of 2006 and 2005, respectively. There was no goodwill impairment recorded in the three month periods ended March 31, 2006, or 2005.

Real estate held for development. Income from real estate operations in our real estate developments is based on cash received less the cost of sales per lot. Cost of sales includes capitalized interest and an
estimate of future costs to be incurred. The estimate of total project costs is reviewed on a quarterly basis by management. Estimates are subject to change for various reasons, including changes in the estimated duration of the project, changes in
rules or requirements of the community where the project resides, soil and weather conditions, increased project budgets, as well as the general level of inflation. If these estimates are incorrect and either the expenses are greater than
anticipated or the sales are slower than expected, we may have to expend additional funds or obtain borrowings to cover current improvement costs and our financial results could be negatively impacted.

Any change in future estimated cost will affect cost of sales amounts used to determine income from real estate operations from past sales. The resulting change in
income is recognized in the period of change as either a charge or an addition to income from real estate operations. Additionally, we periodically evaluate the net realizable value from each project by considering factors such as pace of lot
absorption, sources of funding and timing of disbursements. A charge to current earnings would occur if this evaluation indicated a projects net realizable value did not exceed its recorded cost. Currently, the estimated net realizable value
of Springbank, our only project currently under development, exceeds the recorded cost of the project.

Non-GAAP Financial Information

This report contains certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United
States of America, or GAAP. These measures include tangible book value per share, tangible stockholders equity to tangible assets ratio and annualized return on average tangible equity. We use these non-GAAP measures in our analysis of our
performance and financial condition and believe this presentation provides useful supplemental information that is helpful in understanding our financial condition and results, as they provide a method to assess our success in managing and utilizing
tangible capital. These disclosures should not be considered an alternative to GAAP, nor are they necessarily comparable to non-GAAP performance measures that might be presented by other companies.

Tangible Book Value Per Share

Tangible book
value per share is calculated by dividing (a) stockholders equity less the sum of goodwill and core deposit intangibles, by (b) common shares outstanding. The following table presents a reconciliation of stockholders equity to
tangible stockholders equity (in thousands):



|                                   |  |         |  |  |           |   |  |         |  |  |           |   |  |        |  |  |           |   |  |   |  |  |       |   |  |   |  |  |          |   |  |   |  |  |       |  
|---------------------------------- |  | ------- |  |  | --------- | - |  | ------- |  |  | --------- | - |  | ------ |  |  | --------- | - |  | - |  |  | ----- | - |  | - |  |  | -------- | - |  | - |  |  | ----- | -
|                                   |  | 3/31/06 |  |  | 12/31/05  |   |  | 3/31/05 | 
|                                   |  | Amount  |  |  | Per share |   |  | Amount  |  |  | Per share |   |  | Amount |  |  | Per share |  
|Stockholders equity - as reported |  | $       |  |  | 1,066,304 |   |  | $       |  |  | 31.50     |   |  | $      |  |  | 978,179   |   |  | $ |  |  | 30.50 |   |  | $ |  |  | 953,070  |   |  | $ |  |  | 29.27 |  
|Goodwill                           |  |         |  |  | (388,070  | ) |  |         |  |  | (11.46    | ) |  |        |  |  | (304,251  | ) |  |   |  |  | (9.49 | ) |  |   |  |  | (305,166 | ) |  |   |  |  | (9.37 | )
|Core deposit intangibles           |  |         |  |  | (22,626   | ) |  |         |  |  | (.67      | ) |  |        |  |  | (10,164   | ) |  |   |  |  | (.32  | ) |  |   |  |  | (12,329  | ) |  |   |  |  | (.38  | )
|                                   |  |         |  |  |           |   |  |         |  |  |           |   |  |        |  |  |           |   |  |   |  |  |       |   |  |   |  |  |          |   |  |   |  |  |       |  
|Tangible stockholders equity      |  | $       |  |  | 655,608   |   |  | $       |  |  | 19.37     |   |  | $      |  |  | 663,764   |   |  | $ |  |  | 20.70 |   |  | $ |  |  | 635,575  |   |  | $ |  |  | 19.52 |  
|                                   |  |         |  |  |           |   |  |         |  |  |           |   |  |        |  |  |           |   |  |   |  |  |       |   |  |   |  |  |          |   |  |   |  |  |       |  

Return on Average Tangible Stockholders Equity

Return on average tangible stockholders equity is calculated by dividing (a) annualized net income by (b) average stockholders equity less the
sum of average goodwill and core deposit intangibles. The following table presents a reconciliation of average stockholders equity to average tangible stockholders equity (in thousands):



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|                                      |  |         |  |  |           |   |  |          |   |  |          |  
|------------------------------------- |  | ------- |  |  | --------- | - |  | -------- | - |  | -------- | -
|                                      |  | 3/31/06 |  |  | 12/31/05  |   |  | 3/31/05  |  
|Average stockholders equity          |  | $       |  |  | 1,043,472 |   |  | 974,797  |   |  | 968,343  |  
|Average goodwill                      |  |         |  |  | (357,331  | ) |  | (304,313 | ) |  | (305,178 | )
|Average core deposit intangibles      |  |         |  |  | (18,712   | ) |  | (10,633  | ) |  | (12,812  | )
|                                      |  |         |  |  |           |   |  |          |   |  |          |  
|Average tangible stockholders equity |  | $       |  |  | 667,429   |   |  | 659,851  |   |  | 650,353  |  
|                                      |  |         |  |  |           |   |  |          |   |  |          |  

Results of Operations for the Three Months Ended March 31, 2006 and 2005

First Quarter Financial and Operating Highlights

The following table
highlights selected financial information and operating results for the three months ended March 31, 2006, and 2005:



|                                         |  |                                               |   |  |           |  
|---------------------------------------- |  | --------------------------------------------- | - |  | --------- | -
|                                         |  | Three Months Ended March 31,                  |  
|                                         |  | 2006                                          |   |  | 2005      |  
|                                         |  | (Dollars in thousands, except per share data) |  
|Total assets                             |  | $11,534,062                                   |   |  | 9,715,529 |  
|Net income                               |  | 25,080                                        |   |  | 24,177    |  
|Diluted earnings per share               |  | .74                                           |   |  | .72       |  
|Return on average assets(1)              |  | .90                                           | % |  | 1.00      | %
|Return on average equity(1)              |  | 9.61                                          |   |  | 9.99      |  
|Return on average tangible equity(1),(2) |  | 15.03                                         |   |  | 14.87     |  
|Efficiency ratio(3)                      |  | 56.35                                         |   |  | 56.96     |  
|                                         |  |                                              
|Loan sales                               |  | $    255,937                                  |   |  | 230,732   |  

| | 
| | 

| | (1) | Annualized.
| | --- | -----------

| | (2) | See Non-GAAP Financial Information starting on page 16.
| | --- | ---------------------------------------------------------

| | (3) | The efficiency ratio is calculated by dividing non-interest expense by the sum of net interest income and non-interest income, excluding net gain (loss) on sale of mortgage-backed
and investment securities and mortgage servicing rights.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We completed our acquisition and related data processing conversion of EFC during the quarter. The majority of our growth in average earning assets in the first three months of 2006 is
attributable to the acquisition. At the time of the merger, EFC had total assets of $1.1 billion. We have expanded our Chicago area footprint by seven banking offices acquired through the EFC acquisition.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We continued to diversify our loan portfolio during the quarter, shifting our non one- to four-family loans to 25% of our loan portfolio, from 22% a year ago.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We completed $255.9 million in loan sales during the quarter compared to $230.7 million the period a year ago, reflecting our strategy to sell more adjustable-rate products in the lower net
interest margin environment. Our loan sale gains decreased due to lower sales of higher-margin equity lines of credit as compared to the prior year period.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Income from real estate development was $852,000 in the first three months of 2006 from closings on lot sales in the first two units of Springbank.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Our non-interest expense remained stable, increasing 2.2% from the same period a year ago as modest increases in compensation and benefits from the acquisition of EFC were offset by decreases
in incentive accruals and other expenses, such as professional fees and telephone expense. Our efficiency ratio has improved slightly from the same period a year ago, but increased from the 52.40% reported for the quarter ended December 31,
2005, reflecting the impact of the EFC acquisition.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We authorized a new stock repurchase program for up to 1.7 million shares during the quarter ended March 31, 2006, and completed the repurchase of 738,005 shares of our common stock
for $31.8 million.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Net Income

We reported
net income for the first quarter ended March 31, 2006 of $25.1 million, or $.74 per diluted share compared to net income of $24.2 million, or $.72 per diluted share in last years first quarter.

Net Interest Income and Net Interest Margin

Net interest income
remained relatively unchanged at $67.4 million for the three months ended March 31, 2006, compared to $67.5 million for the three months ended March 31, 2005, due to a combination of rising short-term interest rates, a flattening yield
curve, additional bank-owned life insurance investments, a reduced yield on FHLBC stock and higher deposit pricing due to the change in the mix of our customer deposits.

Average interest-earning assets for the first quarter of 2006 increased $1.33 billion, or 15% compared to the first quarter of 2005, approximately 49% of which was a result of the EFC acquisition. The balance of the increase in
average interest-earning assets is due to the growth in loans receivable and mortgage-backed securities in the last three quarters of 2005, offset by redemptions of stock in the FHLB of Chicago, or FHLBC. Our net interest margin declined to 2.64%
for the quarter compared to 3.04% in the previous year quarter, as the cost of interest-bearing liabilities increased faster than the yield on interest-earning assets in the rising rate environment. Core deposit growth has continued to be difficult
as consumer preferences have shifted into higher-yielding certificate accounts in the current rate environment, which has also increased our cost of deposits.

During the current quarter, exclusive of the addition of EFC, we limited asset growth in the lowest yielding asset categories, one- to four-family loans and securities, because of the flat yield curve environment and its impact
on the profitability of these assets. We achieved this through sales of securities and limited reinvestment of loan and MBS prepayments, in lieu of refinancing maturing borrowings. Should the current interest rate environment persist, we expect our
strategy to limit asset growth will increase our regulatory capital ratios, giving us the option of growing our balance sheet at a later time, or reducing our capital level through additional dividends to our holding company which could either
retire debt, reduce the need for additional debt or repurchase additional shares of our stock.

The yield on investment securities declined markedly
to 4.10% for the first quarter of 2006 from 5.00% for the first quarter of 2005, due to the impact of the lowered dividend rate on FHLBC stock. We earned an annualized 3.0% on our FHLBC stock investment in the quarter ended March 31, 2006
compared to 6.0% in the prior year quarter. The FHLBC declared a 3.10% annualized dividend to be paid in the second quarter and indicated they expected to pay dividends at an annualized rate of 3.00% to 3.50% for the balance of 2006.

The increase in our average cost of deposits reflects rising rates as well as a shift in the mix of our deposits toward higher-costing certificates of deposit as
consumers have been moving funds to certificates of deposit to earn higher interest rates.

Similarly, our borrowing costs increased 81 basis points
due to the upward repricing of floating rate borrowings, and refinancing maturities to fixed rate borrowings at higher interest rates. In the last twelve months, we issued $67 million of higher-cost, floating-rate junior subordinated debentures to
repay amounts drawn on our line of credit and also increased our unsecured floating rate term loan by $52 million as part of the financing of the cash portion of the EFC transaction. We expect further compression in the net interest margin due to
the flat yield curve environment, and continued pressure on funding costs due to strong competition in our markets and changing deposit mix.

Average
Balances/Rates

The following tables reflect the average yield on assets and average cost of liabilities for the periods indicated. Such yields
and costs are derived by dividing income or expense by the average balance of assets or liabilities. Average balances are derived from average daily balances. The yield/cost calculations at March 31, 2006 and 2005 include fees that are
considered adjustments to yield.



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|                                                                 |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    
|---------------------------------------------------------------- |  | ---------------------------- | ---------------------- | -------- | ---------- | ----------------- | ------- | ----------------- | -------------- | - | -------- | - | ----------------- |  | --------- | ------- | ------- | ----------- | ------ | - |  | - |  |  | ---------- |  | ------ | ---
|                                                                 |  | Three Months Ended March 31, |                        |          |            |                   |         |                   |                |  
|                                                                 |  | 2006                         |                        |          | 2005       |                   |         | At March 31, 2006 |               
|                                                                 |  | AverageBalance               |                        | Interest |            | AverageYield/Cost |         |                   | AverageBalance |   | Interest |   | AverageYield/Cost |  |           | Balance |         | Yield/ Cost |       
|                                                                 |  |                              | (Dollars in thousands) |         
|Assets:                                                          |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    
|Loans receivable(1)                                              |  | $                            |                        |          | 7,920,161  |                   | 115,786 |                   | 5.88           | % |          | $ |                   |  | 6,910,358 |         | 89,827  |             | 5.22   | % |  | $ |  |  | 8,172,313  |  | 6.00   | %  
|Mortgage-backed securities                                       |  |                              |                        |          | 1,546,426  |                   | 17,447  |                   | 4.51           |   |          |   |                   |  | 1,247,914 |         | 12,646  |             | 4.05   |   |  |   |  |  | 1,526,426  |  | 4.43   |    
|Stock in FHLB of Chicago                                         |  |                              |                        |          | 173,938    |                   | 1,308   |                   | 3.05           |   |          |   |                   |  | 260,430   |         | 4,248   |             | 6.62   |   |  |   |  |  | 178,286    |  | 3.00   |    
|Investment securities                                            |  |                              |                        |          | 515,189    |                   | 5,650   |                   | 4.45           |   |          |   |                   |  | 390,146   |         | 3,765   |             | 3.91   |   |  |   |  |  | 517,712    |  | 4.38   | (3)
|Interest-bearing deposits and federal funds sold(2)              |  |                              |                        |          | 74,792     |                   | 1,324   |                   | 7.18           |   |          |   |                   |  | 90,705    |         | 1,038   |             | 3.56   |   |  |   |  |  | 131,987    |  | 4.48   |    
|                                                                 |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    
|Total interest-earning assets                                    |  |                              |                        |          | 10,230,506 |                   | 141,515 |                   | 5.56           |   |          |   |                   |  | 8,899,553 |         | 111,524 |             | 5.03   |   |  |   |  |  | 10,526,724 |  | 5.62   |    
|Non-interest earning assets                                      |  |                              |                        |          | 918,797    |                   |         |                   |                |   |          |   |                   |  | 758,944   |         |         |             |        |   |  |   |  |  | 1,007,338  |  |        |    
|                                                                 |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    
|Total assets                                                     |  |                              |                        |          | 11,149,303 |                   |         |                   |                |   |          |   |                   |  | 9,658,497 |         |         |             |        |   |  |   |  |  | 11,534,062 |  |        |    
|                                                                 |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    
|Liabilities and stockholders equity:                            |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    
|Deposits                                                         |  |                              |                        |          | 6,045,139  |                   | 38,552  |                   | 2.59           |   |          |   |                   |  | 5,461,493 |         | 21,843  |             | 1.62   |   |  |   |  |  | 6,308,132  |  | 2.74   |    
|Borrowed funds                                                   |  |                              |                        |          | 3,242,230  |                   | 34,494  |                   | 4.31           |   |          |   |                   |  | 2,568,911 |         | 22,142  |             | 3.50   |   |  |   |  |  | 3,306,934  |  | 4.46   |    
|Junior subordinated debentures                                   |  |                              |                        |          | 67,011     |                   | 1,027   |                   | 6.13           |   |          |   |                   |  |          |         |        |             |       |   |  |   |  |  | 67,011     |  | 6.47   |    
|                                                                 |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    
|Total interest-bearing liabilities                               |  |                              |                        |          | 9,354,380  |                   | 74,073  |                   | 3.21           |   |          |   |                   |  | 8,030,404 |         | 43,985  |             | 2.22   |   |  |   |  |  | 9,682,077  |  | 3.35   |    
|Non-interest bearing deposits                                    |  |                              |                        |          | 558,676    |                   |         |                   |                |   |          |   |                   |  | 486,604   |         |         |             |        |   |  |   |  |  | 587,842    |  |        |    
|Other liabilities                                                |  |                              |                        |          | 192,775    |                   |         |                   |                |   |          |   |                   |  | 173,146   |         |         |             |        |   |  |   |  |  | 197,839    |  |        |    
|                                                                 |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    
|Total liabilities                                                |  |                              |                        |          | 10,105,831 |                   |         |                   |                |   |          |   |                   |  | 8,690,154 |         |         |             |        |   |  |   |  |  | 10,467,758 |  |        |    
|Stockholders equity                                             |  |                              |                        |          | 1,043,472  |                   |         |                   |                |   |          |   |                   |  | 968,343   |         |         |             |        |   |  |   |  |  | 1,066,304  |  |        |    
|                                                                 |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    
|Liabilities and stockholders equity                             |  | $                            |                        |          | 11,149,303 |                   |         |                   |                |   |          | $ |                   |  | 9,658,497 |         |         |             |        |   |  | $ |  |  | 11,534,062 |  |        |    
|                                                                 |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    
|Net interest income/ interest rate spread                        |  |                              |                        |          |            |                   | 67,442  |                   | 2.35           |   |          |   |                   |  |           |         | 67,539  |             | 2.81   |   |  |   |  |  |            |  | 2.27   |    
|                                                                 |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    
|Net earning assets/net yield on average interest-earning assets  |  | $                            |                        |          | 876,126    |                   |         |                   | 2.64           |   |          | $ |                   |  | 869,149   |         |         |             | 3.04   |   |  | $ |  |  | 844,647    |  |        |    
|                                                                 |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    
|Ratio of interest-earning assets to interest-bearing liabilities |  |                              |                        |          |            |                   |         |                   | 109.37         | % |          |   |                   |  |           |         |         |             | 110.82 | % |  |   |  |  |            |  | 108.72 | %  
|                                                                 |  |                              |                        |          |            |                   |         |                   |                |   |          |   |                   |  |           |         |         |             |        |   |  |   |  |  |            |  |        |    

---

|(1) | Includes non-accrual loans in average balances.
|--- | -----------------------------------------------

|(2) | Includes pro-rata share of interest income received on outstanding drafts payable.
|--- | ----------------------------------------------------------------------------------

|(3) | Does not Include pro-rata share of interest income received on outstanding drafts payable.
|--- | ------------------------------------------------------------------------------------------

Rate/Volume Analysis of Net Interest Income

The table below shows the impact of changes in the volume of interest-earning assets and
interest-bearing liabilities and changes in interest rates on our interest income and interest expense for the periods indicated. Changes attributable to the combined impact of volume and rate have been allocated proportionately to the changes due
to volume and the changes due to rate.



|                                                 |  |                                                                                |  |  |        |   |  |        |   |  |        |  
|------------------------------------------------ |  | ------------------------------------------------------------------------------ |  |  | ------ | - |  | ------ | - |  | ------ | -
|                                                 |  | Three Months Ended March 31, 2006Compared to March 31, 2005Increase (Decrease) | 
|                                                 |  | Volume                                                                         |  |  | Rate   |   |  | Net    |  
|                                                 |  | (Dollars in thousands)                                                         | 
|Interest income:                                 |  |                                                                                |  |  |        |   |  |        |   |  |        |  
|Loans receivable                                 |  | $                                                                              |  |  | 13,974 |   |  | 11,985 |   |  | 25,959 |  
|Mortgage-backed securities                       |  |                                                                                |  |  | 3,258  |   |  | 1,543  |   |  | 4,801  |  
|Investment securities                            |  |                                                                                |  |  | 1,322  |   |  | 563    |   |  | 1,885  |  
|Stock in FHLB of Chicago                         |  |                                                                                |  |  | (1,121 | ) |  | (1,819 | ) |  | (2,940 | )
|Interest-bearing deposits and federal funds sold |  |                                                                                |  |  | (200   | ) |  | 486    |   |  | 286    |  
|                                                 |  |                                                                                |  |  |        |   |  |        |   |  |        |  
|Total                                            |  |                                                                                |  |  | 17,233 |   |  | 12,758 |   |  | 29,991 |  
|                                                 |  |                                                                                |  |  |        |   |  |        |   |  |        |  
|                                                 |  |                                                                                |  | 
|Interest expense:                                |  |                                                                                |  |  |        |   |  |        |   |  |        |  
|Interest-bearing deposits                        |  |                                                                                |  |  | 2,546  |   |  | 14,163 |   |  | 16,709 |  
|Borrowed funds                                   |  |                                                                                |  |  | 6,521  |   |  | 5,831  |   |  | 12,352 |  
|Junior subordinated debentures                   |  |                                                                                |  |  | 1,027  |   |  |       |   |  | 1,027  |  
|                                                 |  |                                                                                |  |  |        |   |  |        |   |  |        |  
|Total                                            |  |                                                                                |  |  | 10,094 |   |  | 19,994 |   |  | 30,088 |  
|                                                 |  |                                                                                |  |  |        |   |  |        |   |  |        |  
|Net change in net interest income                |  | $                                                                              |  |  | 7,139  |   |  | (7,236 | ) |  | (97    | )
|                                                 |  |                                                                                |  |  |        |   |  |        |   |  |        |  

Provision for Loan Losses

We recorded a $400,000 provision for loan losses during the first quarter of 2006 compared to no provision in the prior year first quarter. Net charge-offs for the three months ended March 31, 2006, were $168,000 compared to $6,000 for
the three months ended March 31, 2005. At March 31, 2006, our allowance for loan losses was $41.0 million, or .51% of total loans receivable, compared to $36.5 million, or .51% at December 31, 2005, and $36.2 million or .53% at
March 31, 2005. The increase in the amount of the allowance is largely attributable to the $4.3 million allowance acquired in the EFC acquisition. The provision reflects a change in our loan mix and a higher level of non-performing loans as a
result of loans acquired from



19



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##### Table of Contents

EFC and increasing delinquencies in the one- to four-family and equity loan portfolios, as well as managements assessment of economic trends and excellent credit
quality experience in our business banking portfolio. In managements judgment, the allowance for loan losses was adequate at March 31, 2006.

Non-Interest Income

Non-interest income, increased $2.4 million or 13%, compared to the quarter ended March 31, 2005. The
majority of the increase is due to organic growth in all income categories except gain on sale of loans and investments. The EFC transaction also contributed to increases in these categories. We have expanded our mortgage offerings to include
various non-conforming and sub-prime mortgage products due to the increased demand for these products in the overall mortgage market. Sub-prime product offerings generated $235,000 in loan fee income for us in the first quarter of 2006. We sell the
newly originated sub-prime loans into the secondary market at origination rather than retain them in portfolio.

Loan Originations, Sales and Servicing



|                                                                                    |  |                                      |  |         |      |  |         |  
|----------------------------------------------------------------------------------- |  | ------------------------------------ |  | ------- | ---- |  | ------- | -
|                                                                                    |  | For the Three Months Ended March 31, | 
|                                                                                    |  | 2006                                 |  |         | 2005 | 
|                                                                                    |  | (Dollars in thousands)               | 
|One- to four-family Originations and Purchases                                      |  |                                      |  |         |      |  |         |  
|Fixed-rate                                                                          |  | $                                    |  | 126,966 |      |  | 134,101 |  
|Adjustable rate                                                                     |  |                                      |  | 251,109 |      |  | 280,628 |  
|                                                                                    |  |                                      |  |         |      |  |         |  
|Total                                                                               |  | $                                    |  | 378,075 |      |  | 414,729 |  
|                                                                                    |  |                                      |  |         |      |  |         |  
|                                                                                    |  |                                      | 
|Loan Sales                                                                          |  |                                      |  |         |      |  |         |  
|One- to four-family mortgages:                                                      |  |                                      |  |         |      |  |         |  
|Fixed-rate                                                                          |  | $                                    |  | 135,725 |      |  | 145,525 |  
|Adjustable rate                                                                     |  |                                      |  | 91,900  |      |  | 8,364   |  
|                                                                                    |  |                                      |  |         |      |  |         |  
|Total                                                                               |  |                                      |  | 227,625 |      |  | 153,889 |  
|Equity lines of credit and home equity loans                                        |  |                                      |  | 28,312  |      |  | 76,843  |  
|                                                                                    |  |                                      |  |         |      |  |         |  
|Total loans sold                                                                    |  | $                                    |  | 255,937 |      |  | 230,732 |  
|                                                                                    |  |                                      |  |         |      |  |         |  
|Capitalized mortgages servicing rights as a percentage of loans serviced for others |  |                                      |  | .68     | %    |  | .69     | %
|Gain on sale of one- to four-family mortgages                                       |  | $                                    |  | 2,378   |      |  | 1,946   |  
|Gain on sale of equity lines of credit                                              |  |                                      |  | 602     |      |  | 1,930   |  
|                                                                                    |  |                                      |  |         |      |  |         |  
|Total loan sale gains                                                               |  | $                                    |  | 2,980   |      |  | 3,876   |  
|                                                                                    |  |                                      |  |         |      |  |         |  
|Margin on one- to four-family loan sales                                            |  |                                      |  | 1.04    | %    |  | 1.26    | %
|                                                                                    |  |                                      | 
|Loan Servicing                                                                      |  |                                      |  |         |      |  |         |  
|Loan servicing fee income, net                                                      |  | $                                    |  | 785     |      |  | 681     |  
|Valuation recovery on mortgage servicing rights impairment                          |  |                                      |  |        |      |  | 125     |  

Total one- to four-family residential mortgage loan volume decreased 26% during the current quarter compared
to the fourth quarter of 2005, and was down 9% compared to the first quarter of 2005. Loan volume demand is declining due to rising market interest rates. Higher loan sale gains in the first quarter of 2006 compared to the first quarter of 2005
resulted from the increased sales of adjustable one- to four-family loans and also benefited from modestly higher margins. The decrease in loan sale gains in the current quarter compared to the prior year is due to lower sales of higher-margin
equity lines of credit offset in part by increased sales of adjustable-rate one-to four-family loans. Loan servicing income increased primarily due to lower mortgage servicing right amortization expense as loan prepayments have slowed.

During 2006, we intend to continue to pursue opportunities to sell both one- to four-family mortgage and home equity products into the secondary market,
expanding the amount of ARM loans sold to limit balance sheet growth and help mitigate some of the net interest margin pressure in the current difficult yield environment. Our equity loan sales represent primarily wholesale purchases and
single-service borrowers with limited account relationships with us.



20



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##### Table of Contents

Deposit Account Service Charges



|                                   |  |                                            |         |   |      |         |  
|---------------------------------- |  | ------------------------------------------ | ------- | - | ---- | ------- | -
|                                   |  | At or For the Three Months Ended March 31, |        
|                                   |  | 2006                                       |         |   | 2005 |        
|                                   |  | (Dollars in thousands)                     |        
|Deposit service fees               |  | $                                          | 8,722   |   |      | 7,646   |  
|Deposit service fees/total revenue |  |                                            | 9.9     | % |      | 8.9     | %
|                                   |  |                                           
|Number of checking accounts        |  |                                            | 267,100 |   |      | 246,600 |  

We reported a 14% increase in deposit account service charges for the current year quarter compared to the
previous year quarter, primarily reflecting increases in debit card activity combined with a larger deposit base. We implemented a new ATM fee structure in the second half of 2005 which has increased our overall service fees. We intend to increase
our marketing efforts to regain some of the core deposits lost in recent periods due to consumer preferences that have shifted into higher-yielding certificate accounts in the current rate environment and intense competition in our markets.

Real Estate Development Operations



|                                   |  |                                            |  |       
|---------------------------------- |  | ------------------------------------------ |  | ------
|                                   |  | At or For the Three Months Ended March 31,
|                                   |  | 2006                                       |  | 2005  
|                                   |  | (Dollars in thousands)                    
|Real estate development income     |  | $        852                               |  |      
|Residential lot sale closings      |  | 55                                         |  |      
|Investment in real estate          |  | $    55,082                                |  | 40,173
|Lots under contract at quarter end |  | 28                                         |  | 169   

Activity during the first quarter of 2006 reflects closings of lots previously under contract in the initial
phases of the Springbank project. Work is underway on the next phase where sales are expected to commence later in the year. Springbank has been selected as the site for the Northern Illinois Home Builders Associations 2006 Cavalcade of Homes,
to be held this summer. This annual showcase of model homes is expected to bring considerable attention and customer traffic to the development and offers unique sales opportunities. Due to the timing of this event and the pace of improvements,
sales in the project are expected to be higher in the second half of the year.

The increase in the balance of investment in real estate as compared
to a year ago relates primarily to continued land purchases and development costs related to Springbank, offset by the cost of lots sold.

Non-Interest Expense

The following table identifies changes in our non-interest expense for the periods ended March 31:



|                                              |  |                                      |        |      |        |                              |       |  
|--------------------------------------------- |  | ------------------------------------ | ------ | ---- | ------ | ---------------------------- | ----- | -
|                                              |  | For the Three Months Ended March 31, |       
|                                              |  | 2006                                 |        | 2005 |        | PercentageIncrease(Decrease) |      
|                                              |  | (Dollars in thousands)               |        |      |       
|Compensation                                  |  | $                                    | 20,054 |      | 19,870 |                              | 0.9   | %
|Employee benefits                             |  |                                      | 7,379  |      | 7,204  |                              | 2.4   |  
|                                              |  |                                      |        |      |        |                              |       |  
|Total compensation and benefits               |  |                                      | 27,433 |      | 27,074 |                              | 1.3   |  
|                                              |  |                                      |        |      |        |                              |       |  
|Office occupancy                              |  |                                      | 5,857  |      | 5,021  |                              | 16.7  |  
|Furniture, fixture and equipment              |  |                                      | 2,132  |      | 1,960  |                              | 8.8   |  
|Advertising and promotion                     |  |                                      | 1,739  |      | 2,001  |                              | (13.1 | )
|Data processing                               |  |                                      | 2,666  |      | 2,044  |                              | 30.4  |  
|Amortization of core deposit intangibles      |  |                                      | 1,016  |      | 737    |                              | 37.9  |  
|Other expenses:                               |  |                                      |        |      |        |                              |       |  
|Professional fees                             |  |                                      | 774    |      | 1,524  |                              | (49.3 | )
|Stationery, brochures and supplies            |  |                                      | 783    |      | 832    |                              | (5.9  | )
|Postage                                       |  |                                      | 741    |      | 712    |                              | 4.1   |  
|Telephone                                     |  |                                      | 486    |      | 601    |                              | (19.1 | )
|Transaction fraud losses                      |  |                                      | 466    |      | 371    |                              | 25.9  |  
|Correspondent banking services                |  |                                      | 452    |      | 463    |                              | (2.4  | )
|Title fees, recording fees and credit reports |  |                                      | 467    |      | 643    |                              | (27.4 | )
|Security                                      |  |                                      | 408    |      | 418    |                              | (2.4  | )
|Insurance                                     |  |                                      | 470    |      | 454    |                              | 3.5   |  
|FDIC premiums and OTS assessment              |  |                                      | 623    |      | 591    |                              | 5.2   |  
|Real estate held for investment (1)           |  |                                      | 997    |      | 1,016  |                              | (1.9  | )
|Other                                         |  |                                      | 2,158  |      | 2,137  |                              | 1.0   |  
|                                              |  |                                      |        |      |        |                              |       |  
|Total other expenses                          |  |                                      | 8,825  |      | 9,762  |                              | (9.6  | )
|                                              |  |                                      |        |      |        |                              |       |  
|                                              |  | $                                    | 49,668 |      | 48,599 |                              | 2.2   | %
|                                              |  |                                      |        |      |        |                              |       |  

---

(1)Expenses are from SF Equity Properties, Inc., a
subsidiary of the Bank that invests in affordable and senior housing properties in Wisconsin.



21



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##### Table of Contents

Compared to a year ago, total non-interest expense increased $1.1 million, or 2.2%. Compensation and benefits were
up modestly due to the impact of the EFC transaction and normal salary increases, offset by the efficiency improvements realized later in 2005, the reduction of incentive accruals and a workmens compensation insurance refund based on insurance
company audits of prior years activity. The current quarter has an expense of $1,578 relating to 500 stock options that are not yet fully vested. In 2004 and 2005, the majority of stock options granted were immediately vested and therefore
there is no associated compensation expense to be recorded under SFAS No. 123R. Historically, a portion of directors and executive officers compensation has consisted of stock option awards, the majority of which have typically been awarded in
the fourth quarter. We will be required to record compensation expense in future periods for any share-based awards that are made.

Office occupancy
and equipment increased by $1.0 million, or 14.4%, primarily due to occupancy expense related to ten new branches added over the past year, including seven branches acquired in the EFC acquisition. Advertising expense was down 13% in the current
period, but will increase later in the year as we initiate a more aggressive radio campaign. Data processing costs increased 30%, with $300,000 related to the EFC conversion and processing during the quarter, with the remaining increase due to
additional costs relating to ten new branches added since last year. Amortization of core deposit intangibles increased as a result of the EFC acquisition. Other non-interest expenses declined by $937,000 primarily due to lower professional fees and
telephone expense and reduced recording fees.

Income Tax Expense

Income tax expense totaled $13.0 million in the current quarter, equal to an effective income tax rate of 34.1%, lower than the 35.0% reported in the quarter ended March 31, 2005. The lower effective tax rate in the current quarter
compared to the first quarter of 2005 was primarily attributable to the increase in tax-exempt investments and tax-advantaged bank-owned life insurance (BOLI) investments acquired from EFC.

Changes in Financial Condition

Our total assets at March 31, 2006,
increased $1.05 billion, or 10.0% from $10.49 billion at December 31, 2005, primarily due to the EFC acquisition.



|                                              |  |                        |  |                   |            |                            |            |  |                               |   |  |      |  
|--------------------------------------------- |  | ---------------------- |  | ----------------- | ---------- | -------------------------- | ---------- |  | ----------------------------- | - |  | ---- | -
|                                              |  | March 31,2006          |  | December 31, 2005 |            | Amount Increase/(Decrease) |            |  | PercentageIncrease/(Decrease) |  
|                                              |  | (Dollars in thousands) |  |                   |            |                           
|Assets:                                       |  |                        |  |                   |            |                            |            |  |                               |   |  |      |  
|Cash and cash equivalents                     |  | $                      |  |                   | 269,289    |                            | 246,029    |  | 23,260                        |   |  | 9.5  | %
|Investment securities available for sale      |  |                        |  |                   | 517,712    |                            | 475,152    |  | 42,560                        |   |  | 9.0  |  
|Stock in FHLB of Chicago                      |  |                        |  |                   | 178,286    |                            | 165,663    |  | 12,623                        |   |  | 7.6  |  
|Mortgage-backed securities available for sale |  |                        |  |                   | 1,290,935  |                            | 1,313,409  |  | (22,474                       | ) |  | (1.7 | )
|Mortgage-backed securities held to maturity   |  |                        |  |                   | 235,491    |                            | 243,161    |  | (7,670                        | ) |  | (3.2 | )
|Loans receivable, net                         |  |                        |  |                   | 8,131,292  |                            | 7,289,224  |  | 842,068                       |   |  | 11.6 |  
|Bank-owned life insurance                     |  |                        |  |                   | 128,688    |                            | 107,253    |  | 21,435                        |   |  | 20.0 |  
|Goodwill and intangibles                      |  |                        |  |                   | 431,394    |                            | 334,422    |  | 96,972                        |   |  | 29.0 |  
|Other                                         |  |                        |  |                   | 350,975    |                            | 313,191    |  | 37,784                        |   |  | 12.1 |  
|                                              |  |                        |  |                   |            |                            |            |  |                               |   |  |      |  
|Total assets                                  |  | $                      |  |                   | 11,534,062 |                            | 10,487,504 |  | 1,046,558                     |   |  | 10.0 | %
|                                              |  |                        |  |                   |            |                            |            |  |                               |   |  |      |  
|                                              |  |                        |  |                   |           
|Liabilities and Equity:                       |  |                        |  |                   |            |                            |            |  |                               |   |  |      |  
|Deposits                                      |  | $                      |  |                   | 6,895,974  |                            | 6,197,503  |  | 698,471                       |   |  | 11.3 | %
|Borrowed funds                                |  |                        |  |                   | 3,306,934  |                            | 3,057,669  |  | 249,265                       |   |  | 8.2  |  
|Junior subordinated debentures                |  |                        |  |                   | 67,011     |                            | 67,011     |  |                              |   |  |     |  
|Other liabilities                             |  |                        |  |                   | 197,839    |                            | 187,142    |  | 10,697                        |   |  | 15.0 |  
|                                              |  |                        |  |                   |            |                            |            |  |                               |   |  |      |  
|Total liabilities                             |  |                        |  |                   | 10,467,758 |                            | 9,509,325  |  | 958,433                       |   |  | 10.1 |  
|Stockholders equity                          |  |                        |  |                   | 1,066,304  |                            | 978,179    |  | 88,125                        |   |  | 9.0  |  
|                                              |  |                        |  |                   |            |                            |            |  |                               |   |  |      |  
|Total liabilities and equity                  |  | $                      |  |                   | 11,534,062 |                            | 10,487,504 |  | 1,046,558                     |   |  | 10.0 | %
|                                              |  |                        |  |                   |            |                            |            |  |                               |   |  |      |  



22



---

##### Table of Contents

Loans Receivable.The following table sets forth our loan portfolio composition by
loan type at the dates indicated:



|                            |  |                        |  |          |           |         |           |         |           |         |           |  |          
|--------------------------- |  | ---------------------- |  | -------- | --------- | ------- | --------- | ------- | --------- | ------- | --------- |  | ---------
|                            |  | At                    
|                            |  | 3/31/06                |  | 12/31/05 |           | 9/30/05 |           | 6/30/05 |           | 3/31/05
|                            |  | (Dollars in thousands)
|One- to four-family         |  | $                      |  |          | 4,674,897 |         | 4,246,345 |         | 4,194,928 |         | 4,129,019 |  | 4,038,442
|Equity lines of credit      |  |                        |  |          | 1,317,354 |         | 1,282,154 |         | 1,299,368 |         | 1,286,620 |  | 1,262,681
|Home equity loans           |  |                        |  |          | 85,683    |         | 64,596    |         | 61,152    |         | 57,408    |  | 54,074   
|Multi-family                |  |                        |  |          | 734,879   |         | 687,205   |         | 676,976   |         | 654,206   |  | 654,574  
|Commercial real estate      |  |                        |  |          | 652,899   |         | 473,740   |         | 458,409   |         | 473,418   |  | 463,938  
|Construction                |  |                        |  |          | 217,346   |         | 154,873   |         | 128,265   |         | 130,127   |  | 121,395  
|Land                        |  |                        |  |          | 211,648   |         | 150,012   |         | 121,945   |         | 101,040   |  | 87,994   
|Commercial business loans   |  |                        |  |          | 165,324   |         | 146,746   |         | 154,249   |         | 142,334   |  | 147,842  
|Consumer                    |  |                        |  |          | 7,506     |         | 5,566     |         | 6,117     |         | 6,155     |  | 8,479    
|                            |  |                        |  |          |           |         |           |         |           |         |           |  |          
|Total loans receivable, net |  | $                      |  |          | 8,067,536 |         | 7,211,237 |         | 7,101,409 |         | 6,980,327 |  | 6,839,419
|                            |  |                        |  |          |           |         |           |         |           |         |           |  |          

The growth in the our loan portfolio since December 31, 2005, is primarily due to the $865 million of
loans added in the EFC acquisition, although organic growth was strong in loan categories other than one- to four-family loans and equity lines of credit. Without the effect of the EFC acquisition, non-one- to four-family and home equity loans grew
at an annualized rate of 24%. We limited growth in our one- to four-family portfolio, other than through the EFC acquisition, electing to sell adjustable-rate as well as fixed-rate production. The home equity loans and lines of credit portfolio grew
1.6%, exclusive of EFC, as consumer demand for equity lines has lessened in the rising rate environment.

Deposits.The following table sets forth our
deposit composition by type at March 31, 2006, and December 31, 2005:



|                                    |  |                        |  |  |                      |   |  |                     |   |  |        |   |           |   |  |                     |           |  |       |   |  |      |  
|----------------------------------- |  | ---------------------- |  |  | -------------------- | - |  | ------------------- | - |  | ------ | - | --------- | - |  | ------------------- | --------- |  | ----- | - |  | ---- | -
|                                    |  | At March 31, 2006      |  |  | At December 31, 2005 |  
|                                    |  | Amount                 |  |  | % ofTotal            |   |  | WeightedAverageRate |   |  | Amount |   | % ofTotal |   |  | WeightedAverageRate |          
|                                    |  | (Dollars in thousands) | 
|Commercial checking                 |  | $                      |  |  | 282,940              |   |  | 4.1                 | % |  |       |   |           | $ |  |                     | 258,632   |  | 4.2   | % |  |     |  
|Non-interest bearing checking       |  |                        |  |  | 304,902              |   |  | 4.4                 |   |  |       |   |           |   |  |                     | 291,462   |  | 4.7   |   |  |     |  
|Interest-bearing checking           |  |                        |  |  | 827,039              |   |  | 12.0                |   |  | 1.01   | % |           |   |  |                     | 816,387   |  | 13.2  |   |  | .98  | %
|Commercial money market             |  |                        |  |  | 103,347              |   |  | 1.5                 |   |  | 3.91   |   |           |   |  |                     | 60,064    |  | 1.0   |   |  | 3.07 |  
|Money market                        |  |                        |  |  | 711,950              |   |  | 10.3                |   |  | 2.66   |   |           |   |  |                     | 615,280   |  | 9.9   |   |  | 2.34 |  
|Passbook                            |  |                        |  |  | 1,327,165            |   |  | 19.3                |   |  | .69    |   |           |   |  |                     | 1,268,680 |  | 20.4  |   |  | .60  |  
|                                    |  |                        |  |  |                      |   |  |                     |   |  |        |   |           |   |  |                     |           |  |       |   |  |      |  
|Core deposits                       |  |                        |  |  | 3,557,343            |   |  | 51.6                |   |  | 1.14   |   |           |   |  |                     | 3,310,505 |  | 53.4  |   |  | .96  |  
|                                    |  |                        |  |  |                      |   |  |                     |   |  |        |   |           |   |  |                     |           |  |       |   |  |      |  
|                                    |  |                        |  |  |                      |   |  |                    
|Certificate accounts                |  |                        |  |  | 3,339,271            |   |  | 48.4                |   |  | 3.95   |   |           |   |  |                     | 2,885,998 |  | 46.6  |   |  | 3.65 |  
|                                    |  |                        |  |  |                      |   |  |                    
|Unamortized premium (discount), net |  |                        |  |  | (640                 | ) |  |                    |   |  |       |   |           |   |  |                     | 1,000     |  |      |   |  |     |  
|                                    |  |                        |  |  |                      |   |  |                     |   |  |        |   |           |   |  |                     |           |  |       |   |  |      |  
|Total deposits                      |  | $                      |  |  | 6,895,974            |   |  | 100.0               | % |  | 2.50   | % |           | $ |  |                     | 6,197,503 |  | 100.0 | % |  | 2.22 | %
|                                    |  |                        |  |  |                      |   |  |                     |   |  |        |   |           |   |  |                     |           |  |       |   |  |      |  

Borrowed Funds. The following is a summary of our borrowed funds at March 31, 2006 and December 31,
2005:



|                                 |  |                        |  |                     |                      |  |        |   |                     |   |  |  |           |  |      |  
|-------------------------------- |  | ---------------------- |  | ------------------- | -------------------- |  | ------ | - | ------------------- | - |  |  | --------- |  | ---- | -
|                                 |  | At March 31, 2006      |  |                     | At December 31, 2005 | 
|                                 |  | Amount                 |  | WeightedAverageRate |                      |  | Amount |   | WeightedAverageRate |  
|                                 |  | (Dollars in thousands) | 
|Federal Home Loan Bank advances: |  |                        |  |                     |                      |  |        |   |                     |   |  |  |           |  |      |  
|Fixed rate                       |  | $                      |  |                     | 2,480,000            |  | 4.35   | % |                     | $ |  |  | 2,221,000 |  | 4.21 | %
|Adjustable rate                  |  |                        |  |                     | 200,000              |  | 4.76   |   |                     |   |  |  | 250,000   |  | 4.42 |  
|                                 |  |                        |  |                     |                      |  |        |   |                     |   |  |  |           |  |      |  
|Total FHLBC advances             |  |                        |  |                     | 2,680,000            |  | 4.38   |   |                     |   |  |  | 2,471,000 |  | 4.23 |  
|Reverse repurchase agreements    |  |                        |  |                     | 450,000              |  | 4.72   |   |                     |   |  |  | 500,000   |  | 4.24 |  
|Unsecured term loan              |  |                        |  |                     | 115,000              |  | 5.56   |   |                     |   |  |  | 63,000    |  | 5.14 |  
|Other borrowings                 |  |                        |  |                     | 48,774               |  | 3.91   |   |                     |   |  |  | 23,379    |  | 3.38 |  
|Unsecured line of credit         |  |                        |  |                     | 10,000               |  | 5.55   |   |                     |   |  |  |          |  |     |  
|Unamortized premium              |  |                        |  |                     | 3,160                |  |       |   |                     |   |  |  | 290       |  |     |  
|                                 |  |                        |  |                     |                      |  |        |   |                     |   |  |  |           |  |      |  
|Total borrowed funds             |  | $                      |  |                     | 3,306,934            |  | 4.46   | % |                     | $ |  |  | 3,057,669 |  | 4.24 | %
|                                 |  |                        |  |                     |                      |  |        |   |                     |   |  |  |           |  |      |  

At March 31, 2006, reverse repurchase agreements totaled $450 million and are adjustable rate with remaining terms to
maturity ranging from six months to five years. The interest rate on $200 million of these agreements is tied to the prime rate and ranges from prime minus 275 basis points to prime minus 280 basis points. The remaining $250 million have interest
rates ranging from three-month LIBOR minus 26 basis points to three-month LIBOR minus 101 basis points. The LIBOR-based repurchase agreements are putable at the discretion of the lender quarterly at various dates in 2006 and 2007.



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Junior Subordinated Debentures.During 2005, we formed MAF Bancorp Capital Trust I and MAF Bancorp Capital
Trust II, as special purpose finance subsidiaries. The trusts issued $65.0 million in trust preferred securities and the proceeds from the sale of the preferred securities, along with $2.0 million received from our purchase of the common equity
securities of the trusts, were invested in junior subordinated debentures of the Company. The total balance of the junior subordinated debentures issued to the trusts is recorded as a liability. The trust preferred securities mature in 30 years and
are callable at par in five years at our option. We pay interest on the indebtedness at three-month LIBOR plus 1.75% for Capital Trust I and 1.40% for Capital Trust II, resetting quarterly. At March 31, 2006, the interest rate for Capital Trust
I was 6.66% and for Capital Trust II was 6.31%.

Stockholders Equity. Stockholders equity increased by $88.1 million during the past three
months. We issued $101.0 million of stock, totaling 2.34 million shares, for the acquisition of EFC, which was partially offset by cash dividends of $8.5 million and a $5.7 million decrease in the fair value of our available for sale securities
portfolio. To most effectively use our capital in this yield environment, we spent $31.8 million for the repurchase of 738,005 of shares of our stock at an average price of $43.06 during the quarter. There are 1.18 million shares remaining that
are authorized for repurchase in the public market. Included in the share repurchases in the quarter are 215,879 shares from the EFC Employee Stock Option Plan following the merger.

Asset Quality

Non-Performing Assets. We consider loans to be non-performing when they are more than 90 days delinquent
and stop the accrual of interest when, based on current information and events, it is probable that we will be unable to collect all amounts due according to the contractual terms of the loan. Generally, when a loan is 91 days or more past due, in
the process of foreclosure, or in bankruptcy, or when collectibility is otherwise in doubt, the full amount of previously accrued but unpaid interest on the loan is deducted from interest income. Income is subsequently recorded to the extent cash
payments are received, or at the time when the loan is brought current in accordance with its original terms. This policy is applied consistently for all types of loans in our loan portfolio. We also consider the classification of investment
securities as non-performing assets, should they show signs of deteriorating quality.

The following table sets forth information regarding our
non-performing assets at the dates shown. Over the periods shown, all non-performing loans were on non-accrual status.



|                                            |  |                        |  |  |          |   |         |        |         |        |         |        |  |       
|------------------------------------------- |  | ---------------------- |  |  | -------- | - | ------- | ------ | ------- | ------ | ------- | ------ |  | ------
|                                            |  | At                    
|                                            |  | 3/31/06                |  |  | 12/31/05 |   | 9/30/05 |        | 6/30/05 |        | 3/31/05
|                                            |  | (Dollars in thousands)
|Non-accrual loans:                          |  |                        |  |  |          |   |         |        |         |        |         |        |  |       
|                                            |  |                        |  |  |          |  
|One- to four-family                         |  | $                      |  |  | 25,893   |   |         | 21,535 |         | 22,628 |         | 23,084 |  | 22,057
|Equity lines of credit                      |  |                        |  |  | 7,081    |   |         | 6,461  |         | 9,451  |         | 5,084  |  | 4,587 
|Home equity loans                           |  |                        |  |  | 1,043    |   |         | 1,023  |         | 997    |         | 694    |  | 849   
|Multi-family                                |  |                        |  |  | 535      |   |         | 341    |         | 557    |         | 314    |  | 1,270 
|Commercial real estate                      |  |                        |  |  | 2,249    |   |         | 1,639  |         | 898    |         | 1,058  |  | 1,088 
|Construction                                |  |                        |  |  |         |   |         |       |         |       |         |       |  |      
|Land                                        |  |                        |  |  |         |   |         |       |         |       |         |       |  |      
|Consumer loans                              |  |                        |  |  | 20       |   |         | 27     |         | 50     |         | 118    |  | 108   
|Commercial business loans                   |  |                        |  |  | 709      |   |         | 134    |         | 796    |         | 196    |  | 350   
|                                            |  |                        |  |  |          |   |         |        |         |        |         |        |  |       
|Total                                       |  | $                      |  |  | 37,530   |   |         | 31,160 |         | 35,377 |         | 30,548 |  | 30,309
|                                            |  |                        |  |  |          |   |         |        |         |        |         |        |  |       
|Non-performing loans to total loans         |  |                        |  |  | .47      | % |         | .43    |         | .50    |         | .44    |  | .44   
|                                            |  |                        |  |  |          |   |         |        |         |        |         |        |  |       
|Non-accrual investment securities           |  |                        |  |  |          |   |         |        |         |        |         |        |  |       
|Foreclosed real estate, net of reserves:    |  |                        |  |  |          |   |         |        |         |        |         |        |  |       
|One- to four-family                         |  | $                      |  |  | 2,275    |   |         | 789    |         | 789    |         | 387    |  | 1,470 
|                                            |  |                        |  |  |          |   |         |        |         |        |         |        |  |       
|Total non-performing assets                 |  |                        |  |  | 39,805   |   |         | 31,949 |         | 36,166 |         | 30,935 |  | 31,779
|                                            |  |                        |  |  |          |   |         |        |         |        |         |        |  |       
|Total non-performing assets to total assets |  |                        |  |  | .35      | % |         | .30    |         | .35    |         | .31    |  | .33   
|                                            |  |                        |  |  |          |   |         |        |         |        |         |        |  |       

The increase in non-performing one- to four-family loans during the first quarter of 2006 reflects higher
delinquencies and the effects of the acquisition of EFC, which added $2.6 million to our non-performing loan totals. We also experienced an increase in the number of commercial loan delinquencies, primarily attributable to the acquisition of EFC,
not due to a deterioration of the portfolio.

For the quarter ended March 31, 2006, interest on non-accrual loans that would have been recorded
as income, had they been performing according to their original terms, amounted to $599,000 compared to $461,000 for the three months ended March 31, 2005.



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##### Table of Contents

Non-Performing Residential Loans.Information regarding non-performing loans and lines of credit secured by
one- to four-family residential properties are as follows at the dates shown:



|                                                                                                                         |  |               |   |  |                  |  |              
|------------------------------------------------------------------------------------------------------------------------ |  | ------------- | - |  | ---------------- |  | -------------
|                                                                                                                         |  | At           
|                                                                                                                         |  | March 31,2006 |   |  | December 31,2005 |  | March 31,2005
|One- to four-family loans as a percentage of total loans(1)                                                              |  | 75            | % |  | 78               |  | 78           
|Non-performing one- to four-family loans as a percentage of total non-performing loans                                   |  | 91            |   |  | 93               |  | 91           
|Percentage of non-performing one- to four-family loans with private mortgage insurance or other guarantees               |  | 35            |   |  | 36               |  | 45           
|Average loan-to-value of non-performing one- to four-family loans without private mortgage insurance or other guarantees |  | 70            |   |  | 69               |  | 66           
|                                                                                                                         |  |               |   |  |                  |  |              

| | 
| | 

| | (1) | Includes equity lines of credit and home equity loans.
| | --- | ------------------------------------------------------

Classified
Assets.The federal regulators have adopted a classification system for problem assets of insured institutions. Under this classification system, problem assets of insured institutions are classified as substandard,
doubtful or loss. In addition, a special mention category consists of assets, which currently do not expose us to a sufficient degree of risk to warrant classification, but do possess deficiencies or other
characteristics deserving our close attention.

In connection with the filing of its periodic reports with the OTS, we regularly review problem
assets in our portfolio to determine whether any loans or investments require classification in accordance with applicable regulations. At March 31, 2006 and December 31, 2005, all of our non-performing loans were classified as substandard
or doubtful. In addition, at March 31, 2006, we had classified as substandard for regulatory purposes $4.0 million of multi-family loans and $7.1 million of commercial loans that were still accruing interest. We also had $617,000 of commercial
loans classified as doubtful that were still accruing interest. Special mention loans at March 31, 2006 and December 31, 2005 totaled $40.1 and $23.9 million, respectively. These increases are primarily attributable to the 34% increase in
commercial real estate and business loan growth over the past year.

Allowance for Loan Losses

Activity in the allowance for loan losses is summarized in the following table for the three months ended March 31, 2006 and 2005.



|                                      |  |                                      |  |        |      |  |        |  
|------------------------------------- |  | ------------------------------------ |  | ------ | ---- |  | ------ | -
|                                      |  | For the Three Months Ended March 31, | 
|                                      |  | 2006                                 |  |        | 2005 | 
|                                      |  | (Dollars in thousands)               | 
|Balance at beginning of period        |  | $                                    |  | 36,495 |      |  | 36,255 |  
|Allowance acquired in EFC acquisiiton |  |                                      |  | 4,294  |      |  |       |  
|Provision for loan losses             |  |                                      |  | 400    |      |  |       |  
|Charge-offs                           |  |                                      |  | (251   | )    |  | (133   | )
|Recoveries                            |  |                                      |  | 83     |      |  | 127    |  
|                                      |  |                                      |  |        |      |  |        |  
|Balance at end of period              |  | $                                    |  | 41,021 |      |  | 36,249 |  
|                                      |  |                                      |  |        |      |  |        |  

The allowance for loan losses to total loans was .51% at March 31, 2006 compared to .51% at
December 31, 2005, while the allowance for loan losses to non-performing loans was 109.3% at March 31, 2006, compared to 117.12% at December 31, 2005. As shown in the table of non-performing loans above, 91% of non-performing loans
were secured by one- to four-family real estate at March 31, 2006, and 2005. We believe the allowance for loan losses is adequate at March 31, 2006.

Liquidity and Capital Resources

We manage liquidity and capital resources to provide funds necessary for holding company debt
service on borrowings, cash dividends to stockholders, funding for our real estate development operation, and planned repurchases of common stock. Major sources of funds to the holding company are dividends from the Bank, access to the capital
markets which are subject to regulatory limitations, and to a lesser extent, cash flow from our real estate development operation. Additionally, we maintain a $60 million unsecured line of credit with a Chicago-based commercial bank under which we
had $50 million available at March 31, 2006. We increased this facility in connection with financing arrangements for the EFC transaction.

During the current three month period, we declared common stock dividends of $.25 per share, for a total of $8.5 million. For the three month period ended March 31, 2006, we repurchased 738,005 million shares of



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##### Table of Contents

our common stock at an average price of $43.06 for a total of $31.8 million. As we continue to limit growth of our balance sheet, we will continue to focus on the
repurchase of our stock as desirable use of our capital.

Our principal sources of funds are deposits, advances from the FHLBC and other borrowings,
principal repayments on loans and mortgage-backed securities, proceeds from the sale of loans, and funds provided by operations. While scheduled loan and mortgage-backed securities amortization and maturing investment securities are a relatively
predictable source of funds, deposit flows as well as loan and mortgage-backed securities prepayments are greatly influenced by economic conditions, the general level of interest rates and competition. Decisions to sell investment securities and
other assets are also generally market driven, although we may at times sell these assets for asset/liability management purposes or as a source of liquidity.

We utilize particular sources of funds based on comparative costs and availability. We generally manage the pricing of deposits to maintain a steady to increasing deposit portfolio in the aggregate, but from time to time we may
decide not to pay rates on deposits as high as competition. When necessary, we supplement our deposit funding with longer term and/or other alternative sources of funds such as FHLBC advances and other borrowings. We currently expect that due to
increased competition for deposits in our markets, we may increasingly rely on higher cost wholesale borrowings.

Outstanding loan commitments
totaled $822.6 million at March 31, 2006, compared to $757.2 million at December 31, 2005. At March 31, 2006 we believe we have sufficient cash to fund our outstanding commitments or we will be able to obtain the necessary funds from
outside sources to meet our cash requirements under these commitments.

The following table lists our commitments and contingencies as of
March 31, 2006:



|                                                                  |  |                        |  |                |           |              |           |              |         |             |        |  |       
|----------------------------------------------------------------- |  | ---------------------- |  | -------------- | --------- | ------------ | --------- | ------------ | ------- | ----------- | ------ |  | ------
|                                                                  |  | Total                  |  | Lessthan 1Year |           | 1 to 3 Years |           | 3 to 5 Years |         | After5Years
|                                                                  |  | (Dollars in thousands)
|One- to four-family and multi-family mortgage commitments         |  | $                      |  |                | 576,267   |              | 576,267   |              |        |             |       |  |      
|Equity line and equity loan commitments                           |  |                        |  |                | 125,393   |              | 125,393   |              |        |             |       |  |      
|Unused portion of equity lines of credit                          |  |                        |  |                | 1,170,293 |              | 1,170,293 |              |        |             |       |  |      
|Commitments to sell one- to four-family mortgage and equity loans |  |                        |  |                | 134,831   |              | 134,831   |              |        |             |       |  |      
|Commercial business lines                                         |  |                        |  |                | 397,499   |              | 286,713   |              | 71,723  |             | 30,221 |  | 8,842 
|Letters of credit(1)                                              |  |                        |  |                | 122,238   |              | 66,424    |              | 38,228  |             | 10,656 |  | 6,930 
|SBIC commitments                                                  |  |                        |  |                | 4,012     |              | 621       |              | 1,033   |             | 2,358  |  |      
|Commercial business loan commitments                              |  |                        |  |                | 120,904   |              | 120,904   |              |        |             |       |  |      
|Contingent liability under recourse provisions(2)                 |  |                        |  |                | 79,369    |              | 79,369    |              |        |             |       |  |      
|                                                                  |  |                        |  |                |           |              |           |              |         |             |        |  |       
|Total                                                             |  | $                      |  |                | 2,726,793 |              | 2,560,194 |              | 109,951 |             | 40,877 |  | 15,771
|                                                                  |  |                        |  |                |           |              |           |              |         |             |        |  |       

---

|(1) | Letters of credit include $22.1 million related to real estate development projects.
|--- | ------------------------------------------------------------------------------------

|(2) | Amounts are shown based on time to maturity for amounts if used. Balances reflect the maximum amount of potential liability for credit losses at March 31, 2006, that we have
retained relating to an aggregate $746.2 million of one- to four-family loans. We have either sold the loans to investors with recourse or have assumed a layer of credit risk through private mortgage insurance in force in our captive reinsurance
subsidiary and have a contingent liability under these provisions of $79.4 million. Our loss experience to date under such recourse provisions has been immaterial.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The following table lists our contractual obligations coming due as of March 31, 2006:



|                                     |  |                        |  |                 |  |             |  |             |  |              |  |        
|------------------------------------ |  | ---------------------- |  | --------------- |  | ----------- |  | ----------- |  | ------------ |  | -------
|                                     |  | Total                  |  | Lessthan 1 Year |  | 1 to 3Years |  | 3 to 5Years |  | After 5Years
|                                     |  | (Dollars in thousands)
|Certificates of deposit              |  | $                      |  | 3,339,271       |  | 2,769,301   |  | 482,869     |  | 74,330       |  | 12,771 
|FHLB of Chicago advances             |  |                        |  | 2,680,000       |  | 963,000     |  | 1,407,000   |  | 300,000      |  | 10,000 
|Unsecured bank term loan             |  |                        |  | 115,000         |  | 7,500       |  | 27,000      |  | 23,000       |  | 57,500 
|Other borrowings                     |  |                        |  | 498,774         |  | 248,774     |  | 50,000      |  | 200,000      |  |       
|Unsecured line of credit             |  |                        |  | 10,000          |  | 10,000      |  |            |  |             |  |       
|Junior subordinated debentures       |  |                        |  | 67,011          |  |            |  |            |  |             |  | 67,011 
|Purchase obligations                 |  |                        |  | 12,872          |  | 11,113      |  | 1,749       |  | 10           |  |       
|Real estate development contracts(1) |  |                        |  | 22,147          |  | 22,147      |  |            |  |             |  |       
|Post retirement benefit plans        |  |                        |  | 5,246           |  | 104         |  | 223         |  | 386          |  | 4,533  
|Operating leases                     |  |                        |  | 53,037          |  | 5,130       |  | 13,346      |  | 7,783        |  | 26,778 
|                                     |  |                        |  |                 |  |             |  |             |  |              |  |        
|Total                                |  | $                      |  | 6,803,358       |  | 4,037,069   |  | 1,982,187   |  | 605,509      |  | 178,593
|                                     |  |                        |  |                 |  |             |  |             |  |              |  |        

---

|(1) | Reflects contractual obligations to purchase land and pending contractual commitments for improvements. This figure does not include estimated development costs not under contract,
currently estimated at $91.1 million for existing real estate development projects, the majority of which relates to Springbank.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Asset/Liability Management

Our primary market risk is considered to be interest rate risk. Interest rate risk on our balance sheet arises from the maturity mismatch of interest-earning assets versus interest-bearing liabilities, as well as the potential for
maturities to shorten or lengthen on our interest-earning and interest-bearing liabilities due to the exercise of options. The most common of these is prepayment options on mortgage loan assets, and put options on wholesale borrowings or jump-rate
features in our certificates of deposits. Managements goal, through policies established by the Asset/Liability Management Committee of the Board of Directors, or ALCO, is to maximize net interest income, while managing our balance sheet
within the established interest rate risk policy limits prescribed by the ALCO.

One of the techniques used in measuring the sensitivity of net
interest income to changes in interest rates is interest rate sensitivity (static) gap analysis. The static gap is the difference between the amount of interest-earning assets maturing or repricing within a specific period of time and the amount of
interest-bearing liabilities maturing or repricing within that same period of time. We utilize our static gap analysis as means of managing our interest rate risk at the cumulative one-year time horizon. In this analysis, maturities of assets and
liabilities are adjusted for the estimated impact of embedded options that are contained in certain financial instruments on our balance sheet. These include prepayment assumptions on real estate loans, and mortgage-backed securities, call options
embedded in investment securities, and put options embedded in certain borrowings. Because of the level of financial instruments with embedded options on our balance sheet, certain shortcomings are inherent in using gap analysis to quantify exposure
to interest rate risk. For instance, while we model expected loan prepayments in our static gap analysis, actual customer behavior may prove to be much different. Changes in interest rates may impact cash flow on a lag basis, or lead future interest
rate movements, and our expected lives of our non-maturity core deposit accounts may not prove to be as long-term as we assume them to be in our gap analysis. However, we still believe static gap analysis remains a useful tool for us to help manage
our interest rate risk.

Generally, a positive one-year gap, where more interest-earning assets are repricing or maturing during one-year period than
interest-bearing liabilities, would tend to result in a reduction in net interest income in a period of falling interest rates. Conversely, during a period of rising interest rates, a positive one-year gap would likely result in an improvement in
net interest income. Our goal is to maintain our cumulative one-year gap within the range of (15)% to 15%, although we will begin to adjust our ALCO strategies in our interest-sensitive portfolios, if the gap exceeds (10)% to 10%, recognizing that
changes in ALCO strategies made by management take some time to impact our overall static gap position. Our loan portfolio tends to have the most impact on the movement in our static gap the most over a range of changing interest rates, due to the
predominance of one- to four-family mortgage loans that allow the customer to prepay without penalty. We have mitigated the impact one- to four-family loans can have on our gap by: 1) reducing their concentration as a percentage of our overall loan
portfolio, 2) limiting our exposure to long-term fixed-rate mortgage loans, and 3) expanding our equity line of credit and business loan portfolios, that generally carry more frequent interest rate adjustments, adjustable rates and/or shorter
maturities.

Currently we do not use derivative financial instruments such as interest rate swaps, caps, floors, options or similar financial
instruments, to manage our interest rate risk, or periodic net interest income. We do use forward commitments with the GSEs and other investors when selling our loan production originated for sale.

The table on the following page set forth the scheduled repricing or maturity of the Banks assets and liabilities at March 31, 2006. Prepayment
assumptions on loans receivable are based on internal models developed from our actual prepayment experience, while prepayment assumptions on mortgage-backed securities and the impact of embedded put options on borrowings and call options on
investments are based on current market expectations. During 2005, we concluded an analysis of actual decay rates in our core deposit portfolios (passbooks, interest-bearing checking accounts and money market accounts) over the prior five year
period and our March 31, 2006, the analysis below uses withdrawal rates based on this analysis of our own experience. Previously, we had used the annual withdrawal assumptions used by the Office of Thrift Supervision with respect to
interest-bearing checking and passbook accounts. Fixed rate investment securities and borrowings that contain call or put provisions are generally shown in the category relating to their respective final maturities or expected put or call option
being exercised. However, $10.1 million of investments with final maturities averaging 300 months, but callable in six months or less are categorized in the six months or less category, and $13.0 million of investment securities with final
maturities averaging 109 months, but callable in six months to one year are categorized in the six-months to one-year category in anticipation of their calls. At March 31, 2006, $75.0 million of putable FHLBC advances with maturities of 3 to



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5 years are categorized as $50.0 million in the less than six months and $25.0 million in the six months to one year category because the put option is expected to be
exercised.

The effect of these assumptions is to quantify the dollar amount of items that are interest-sensitive and may be repriced within each of
the periods specified. Certain shortcomings are inherent in using gap analysis to quantify exposure to interest rate risk. For example, although certain assets and liabilities may have similar maturities or repricings in the table, they may react
differently to actual changes in market interest rates. The interest rates on certain types of assets and liabilities may fluctuate in advance of changes in market interest rates, while interest rates on other types may lag behind changes in market
rates. This is especially true in circumstances where management has a certain amount of control over interest rates, such as the pricing of deposits. Additionally, certain assets such as hybrid adjustable-rate mortgage loans have features that
restrict changes in interest rates on a short-term basis and over the life of the asset. Finally, as interest rates change, actual loan prepayment rates may differ significantly from those rates assumed by management for presentation purposes in the
table.

Though we believe that our asset/liability management strategies help to mitigate the potential negative effects of changes in interest rates
on our operations, a decrease in long term interest rates in the near term may adversely affect our operations because prepayments on higher-yielding mortgage-related assets would likely accelerate and would be reinvested at lower rates. Conversely,
increases in long-term interest rates could benefit our operation primarily due to a slowing of prepayments on higher yielding loans receivable and mortgage-backed securities and rates adjusting upward while new loans would be originated at higher
rates, although the higher rates may also dampen the level of new originations. An increase in short-term interest rates would negatively impact our operations as we have more interest-bearing liabilities than interest-earning assets repricing in
the short-term.



|                                                                                       |  |                                               |  |           |            |  |            |            |  |           |            |  |           |         |  |           |       |  |           
|-------------------------------------------------------------------------------------- |  | --------------------------------------------- |  | --------- | ---------- |  | ---------- | ---------- |  | --------- | ---------- |  | --------- | ------- |  | --------- | ----- |  | ----------
|                                                                                       |  | Scheduled Expected Maturity at March 31, 2006
|                                                                                       |  | < 1/2 Yr.                                     |  |           | 1/2- 1
Yr. |  |            | 1  3 Yrs. |  |           | 3  5 Yrs. |  |           | 5+ Yrs. |  |           | Total
|                                                                                       |  | (Dollars in thousands)                       
|Interest-earning assets:                                                               |  |                                               |  |           |            |  |            |            |  |           |            |  |           |         |  |           |       |  |           
|Loans receivable held for sale                                                         |  | $                                             |  | 7,985     |            |  |           |            |  | 10,215    |            |  | 51,257    |         |  | 35,320    |       |  | 104,777   
|Loans receivable                                                                       |  |                                               |  | 2,501,205 |            |  | 778,708    |            |  | 2,748,826 |            |  | 1,627,068 |         |  | 411,729   |       |  | 8,067,536 
|Mortgage-backed securities                                                             |  |                                               |  | 143,807   |            |  | 111,323    |            |  | 307,555   |            |  | 270,196   |         |  | 693,545   |       |  | 1,526,426 
|Investment securities available for sale                                               |  |                                               |  | 118,578   |            |  | 54,385     |            |  | 242,611   |            |  | 55,891    |         |  | 46,247    |       |  | 517,712   
|Stock in FHLB of Chicago                                                               |  |                                               |  | 178,286   |            |  |           |            |  |          |            |  |          |         |  |          |       |  | 178,286   
|Interest-bearing deposits and Federal funds sold                                       |  |                                               |  | 131,987   |            |  |           |            |  |          |            |  |          |         |  |          |       |  | 131,987   
|                                                                                       |  |                                               |  |           |            |  |            |            |  |           |            |  |           |         |  |           |       |  |           
|Total interest-earning assets                                                          |  |                                               |  | 3,081,848 |            |  | 944,416    |            |  | 3,309,207 |            |  | 2,004,412 |         |  | 1,186,841 |       |  | 10,526,724
|Impact of hedging activities(1)                                                        |  |                                               |  | 96,792    |            |  |           |            |  | (10,215   | )          |  | (51,257   | )       |  | (35,320   | )     |  |          
|                                                                                       |  |                                               |  |           |            |  |            |            |  |           |            |  |           |         |  |           |       |  |           
|Total net interest-earning assets, adjusted for impact of hedging activities           |  |                                               |  | 3,178,640 |            |  | 944,416    |            |  | 3,298,992 |            |  | 1,953,155 |         |  | 1,151,521 |       |  | 10,526,724
|Interest-bearing liabilities:                                                          |  |                                               |  |           |            |  |            |            |  |           |            |  |           |         |  |           |       |  |           
|Interest-bearing checking accounts                                                     |  |                                               |  | 24,803    |            |  | 28,193     |            |  | 101,444   |            |  | 84,991    |         |  | 587,608   |       |  | 827,039   
|Money market accounts                                                                  |  |                                               |  | 39,488    |            |  | 31,805     |            |  | 85,142    |            |  | 105,447   |         |  | 553,415   |       |  | 815,297   
|Passbook accounts                                                                      |  |                                               |  | 69,616    |            |  | 62,154     |            |  | 194,562   |            |  | 167,868   |         |  | 832,965   |       |  | 1,327,165 
|Certificate accounts                                                                   |  |                                               |  | 1,291,371 |            |  | 1,477,473  |            |  | 482,686   |            |  | 74,330    |         |  | 12,771    |       |  | 3,338,631 
|FHLBC advances                                                                         |  |                                               |  | 471,022   |            |  | 672,206    |            |  | 1,303,570 |            |  | 251,370   |         |  | 9,992     |       |  | 2,616,149 
|Other borrowings                                                                       |  |                                               |  | 689,874   |            |  | 301        |            |  | 243       |            |  |          |         |  | 367       |       |  | 757,796   
|                                                                                       |  |                                               |  |           |            |  |            |            |  |           |            |  |           |         |  |           |       |  |           
|Total interest-bearing liabilities                                                     |  |                                               |  | 2,586,174 |            |  | 2,272,132  |            |  | 2,167,647 |            |  | 684,006   |         |  | 1,997,118 |       |  | 9,682,077 
|                                                                                       |  |                                               |  |           |            |  |            |            |  |           |            |  |           |         |  |           |       |  |           
|Interest sensitivity gap                                                               |  | $                                             |  | 592,466   |            |  | (1,327,716 | )          |  | 1,131,345 |            |  | 1,294,149 |         |  | (845,597  | )     |  | 844,647   
|                                                                                       |  |                                               |  |           |            |  |            |            |  |           |            |  |           |         |  |           |       |  |           
|Cumulative gap                                                                         |  | $                                             |  | 592,466   |            |  | (735,250   | )          |  | 396,095   |            |  | 1,690,244 |         |  | 844,647   |       |  |           
|                                                                                       |  |                                               |  |           |            |  |            |            |  |           |            |  |           |         |  |           |       |  |           
|Cumulative gap as a percentage of total assets                                         |  |                                               |  | 5.14      | %          |  | (6.37      | )          |  | 3.43      |            |  | 14.65     |         |  | 7.32      |       |  |           
|Cumulative net interest-earning assets as a percentage of interest-bearing liabilities |  |                                               |  | 122.91    | %          |  | 84.87      |            |  | 105.64    |            |  | 121.99    |         |  | 108.72    |       |  |           
|                                                                                       |  |                                               |  |           |            |  |           
|At December 31, 2005                                                                   |  |                                               |  |           |            |  |            |            |  |           |            |  |           |         |  |           |       |  |           
|Cumulative gap                                                                         |  | $                                             |  | 307,248   |            |  | (136,989   | )          |  | 581,922   |            |  | 1,737,462 |         |  | 813,245   |       |  |           
|                                                                                       |  |                                               |  |           |            |  |            |            |  |           |            |  |           |         |  |           |       |  |           
|Cumulative gap as a percentage of total assets                                         |  |                                               |  | 2.93      | %          |  | (1.31      | )          |  | 5.55      |            |  | 16.57     |         |  | 7.75      |       |  |           
|Cumulative net interest-earning assets as a percentage of interest-bearing liabilities |  |                                               |  | 111.72    | %          |  | 96.51      |            |  | 109.15    |            |  | 125.08    |         |  | 109.27    |       |  |           

---

|(1) | Represents forward commitments to sell mortgage loans.
|--- | ------------------------------------------------------

Since
December 31, 2005, our cumulative one-year gap has extended to (6.37)% from (1.31)%. Rising long-term interest rates during the quarter slowed estimated prepayment speeds on mortgage loans, extending maturities, while we focused our certificate
of deposit acquisition and retention strategy in maturities of less than one year.

Regulatory Capital. The Bank is subject to regulatory capital
requirements under the rules of the Office of Thrift Supervision, or OTS. Failure to meet minimum capital requirements can initiate certain mandatory



28



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and possibly additional discretionary, actions by regulators, which could have a material impact on the Banks financial statements. Under capital adequacy
guidelines and the regulatory framework for prompt corrective action, the Bank must maintain capital amounts in excess of specified minimum ratios based on quantitative measures of the Banks assets, liabilities, and certain off-balance sheet
items as calculated under regulatory accounting practices.

Quantitative measures established by the OTS to ensure capital adequacy require us to
maintain minimum amounts and ratios (as set forth in the table on the next page) of three capital requirements: a tangible capital (as defined in the regulations) to adjusted total assets ratio, a core capital (as defined) to adjusted total assets
ratio, and a risk-based capital (as defined) to total risk-weighted assets ratio. At March 31, 2006, the Bank exceeded all minimum regulatory capital ratios to be considered well-capitalized.

Our actual capital amounts and ratios, as well as minimum amounts and ratios required for capital adequacy and prompt corrective action provisions are presented in
the following table:



|                                        |  |                        |         |       |                              |   |        |                                                               |       |   |      |        |  |            |  |         |  
|--------------------------------------- |  | ---------------------- | ------- | ----- | ---------------------------- | - | ------ | ------------------------------------------------------------- | ----- | - | ---- | ------ |  | ---------- |  | ------- | -
|                                        |  | Actual                 |         |       | For Capital AdequacyPurposes |   |        | To Be Well CapitalizedUnder PromptCorrective ActionProvisions |      
|                                        |  | Amount                 |         | Ratio |                              |   | Amount |                                                               | Ratio |   |      | Amount |  | Ratio      | 
|                                        |  | (Dollars in thousands) |        
|At March 31, 2006:                      |  |                        |         |       |                              |   |        |                                                               |       |   |      |        |  |            |  |         |  
|Tangible capital (to total assets)      |  | $                      | 797,352 |       | 7.20                         | % |        | 3 $166,057                                                    |       | 3 | 1.50 | %      |  | N/A        |  |         |  
|Core capital (to total assets)          |  |                        | 797,352 |       | 7.20                         |   |        | 3 $442,818                                                    |       | 3 | 4.00 |        |  | 3 $553,523 |  | 3  5.00 | %
|Total capital (to risk-weighted assets) |  |                        | 822,388 |       | 11.17                        |   |        | 3 $589,208                                                    |       | 3 | 8.00 |        |  | 3 $736,530 |  | 310.00  |  
|Core capital (to risk-weighted assets)  |  |                        | 797,352 |       | 10.83                        |   |        | N/A                                                           |       |   | N/A  |        |  | 3 $441,918 |  | 3  6.00 |  
|                                        |  |                        |         |       |                              |  
|At December 31, 2005:                   |  |                        |         |       |                              |   |        |                                                               |       |   |      |        |  |            |  |         |  
|Tangible capital (to total assets)      |  | $                      | 715,105 |       | 7.07                         | % |        | 3 $151,807                                                    |       | 3 | 1.50 | %      |  | N/A        |  |         |  
|Core capital (to total assets)          |  |                        | 715,105 |       | 7.07                         |   |        | 3 $404,818                                                    |       | 3 | 4.00 |        |  | 3 $506,023 |  | 3  5.00 | %
|Total capital (to risk-weighted assets) |  |                        | 735,996 |       | 11.15                        |   |        | 3 $528,112                                                    |       | 3 | 8.00 |        |  | 3 $660,140 |  | 310.00  |  
|Core capital (to risk-weighted assets)  |  |                        | 715,105 |       | 10.83                        |   |        | N/A                                                           |       |   | N/A  |        |  | 3 $396,084 |  | 3  6.00 |  

The following table reflects the adjustments required to reconcile the Banks stockholders equity
to the Banks regulatory capital at March 31, 2006:



|                                                   |  |                        |  |      |           |            |  |  |  |  |  |           |   |  |  |  |  |  |           |   |  | 
|-------------------------------------------------- |  | ---------------------- |  | ---- | --------- | ---------- |  |  |  |  |  | --------- | - |  |  |  |  |  | --------- | - |  | 
|                                                   |  | Tangible               |  | Core |           | Risk-Based
|                                                   |  | (Dollars in thousands)
|Stockholders equity of the Bank                   |  | $                      |  |      | 1,185,533 |            |  |  |  |  |  | 1,185,533 |   |  |  |  |  |  | 1,185,533 |   |  | 
|Goodwill and core deposit intangibles              |  |                        |  |      | (410,696  | )          |  |  |  |  |  | (410,696  | ) |  |  |  |  |  | (410,696  | ) |  | 
|Non-permissible subsidiary deduction               |  |                        |  |      | (397      | )          |  |  |  |  |  | (397      | ) |  |  |  |  |  | (397      | ) |  | 
|Non-includible purchased mortgage servicing rights |  |                        |  |      | (2,070    | )          |  |  |  |  |  | (2,070    | ) |  |  |  |  |  | (2,070    | ) |  | 
|Adjustment for available for sale securities       |  |                        |  |      | 24,982    |            |  |  |  |  |  | 24,982    |   |  |  |  |  |  | 24,982    |   |  | 
|Recourse on loan sales                             |  |                        |  |      |          |            |  |  |  |  |  |          |   |  |  |  |  |  | (15,985   | ) |  | 
|General allowance for loan losses                  |  |                        |  |      |          |            |  |  |  |  |  |          |   |  |  |  |  |  | 41,021    |   |  | 
|                                                   |  |                        |  |      |           |            |  |  |  |  |  |           |   |  |  |  |  |  |           |   |  | 
|Regulatory capital of the Bank                     |  | $                      |  |      | 797,352   |            |  |  |  |  |  | 797,352   |   |  |  |  |  |  | 822,388   |   |  | 
|                                                   |  |                        |  |      |           |            |  |  |  |  |  |           |   |  |  |  |  |  |           |   |  | 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

A quantitative and qualitative analysis about
market risk is included in our December 31, 2005 Form 10-K. There have been no material changes in the assumptions used or in the results of market risk analysis as of March 31, 2006, since December 31, 2005. See Asset/Liability
Management in Item 2., for a further discussion of our interest rate sensitivity gap analysis.

Item 4. Controls and Procedures

As of March 31, 2006, our Chief Executive Officer and Chief Financial Officer
carried out an evaluation under their supervision, with the participation of other members of management as they deemed appropriate, of the effectiveness of the design and operation of the Companys disclosure controls and procedures as
contemplated by Rule 13a-15(e) under the Securities Exchange Act of 1934. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that as of March 31, 2006, the Companys disclosure controls and
procedures are effective, in all material respects, in timely alerting them to material information relating to the Company (and its consolidated subsidiaries) and in ensuring that information required to be included in the periodic reports the
Company files or submits to the SEC under the Securities Exchange Act is recorded, processed, summarized and reported as required.



29



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There has been no change in our internal control over financial reporting during the first quarter of 2006 that has
materially affected or is reasonably likely to materially affect our internal control over financial reporting.



30



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##### Table of Contents

Part II - Other Information

Item 1. Legal Proceedings.

Not applicable.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

The following table sets forth information in
connection with purchases of our common stock made by, or on behalf of us, during the first quarter of 2006.



|                                           |  |                                  |  |                            |  |                                                                              |       |                                                                                   |         |  |          
|------------------------------------------ |  | -------------------------------- |  | -------------------------- |  | ---------------------------------------------------------------------------- | ----- | --------------------------------------------------------------------------------- | ------- |  | ---------
|Period                                     |  | TotalNumber ofSharesPurchased(1) |  | AveragePrice Paidper Share |  | Total Number ofShares Purchased asPart of PubliclyAnnounced Plans orPrograms |       | Maximum Number ofShares that May Yetbe Purchased
underthe Plans orPrograms(2),(3)
|January 1, 2006 through January 31, 2006   |  |                                 |  | $                          |  |                                                                              |      |                                                                                   |        |  | 1,500    
|February 1, 2006 through February 28, 2006 |  | 427,423                          |  |                            |  |                                                                              | 42.83 |                                                                                   | 211,610 |  | 1,489,890
|March 1, 2006 through March 31, 2006       |  | 315,435                          |  |                            |  |                                                                              | 43.33 |                                                                                   | 310,516 |  | 1,179,374
|                                           |  |                                  |  |                            |  |                                                                              |       |                                                                                   |         |  |          
|Total                                      |  | 749,858                          |  | $                          |  |                                                                              | 43.04 |                                                                                   | 522,126 |  | 1,179,374
|                                           |  |                                  |  |                            |  |                                                                              |       |                                                                                   |         |  |          

---

|(1) | The table includes 11,853 shares that were surrendered to us in payment of the option exercise price and does not include 6,769 shares that were surrendered in payment of
withholding tax in connection with the exercise of related options during the quarter.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(2) | Our Board of Directors approved the repurchase of up to 1.7 million shares in February 2006. Unless earlier terminated by the Board of Directors, this program will expire when
we have completed the repurchase of all shares authorized under the plan.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(3) | Included in the share repurchases are 215,879 shares separately authorized by the Board of Directors that were repurchased in a private transaction.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------

Item 3. Defaults Upon Senior Securities.

Not applicable.

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

Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits.



|                 |  |                                                                                                                                                                                      
|---------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. 3.1  |  | Restated Certificate of Incorporation. (Incorporated herein by reference to Exhibit 3.1 to Registrants Form 8-K (File No. 0-18121) dated December 19, 2000.)                        
|                 | 
|Exhibit No. 3.2  |  | Amended and Restated By-laws of Registrant. (Incorporated herein by reference to Exhibit No. 3 to Registrants Form 10-Q for the period ended September 30, 2003 (File No.
0-18121).)
|                 | 
|Exhibit No. 31.1 |  | Certification of Chief Executive Officer.+                                                                                                                                           
|                 | 
|Exhibit No. 31.2 |  | Certification of Chief Financial Officer.+                                                                                                                                           
|                 | 
|Exhibit No. 32.1 |  | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.+      

---

+ Filed herewith.



31



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SIGNATURES

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





|                                                                                                |  |  |  |                  
|----------------------------------------------------------------------------------------------- |  |  |  | -----------------
|                                                                                                |  |  |  | MAF Bancorp, Inc.
|                                                                                                |  |  |  | (Registrant)     
|                                                                                                |  | 
|/s/ Allen H. Koranda                                                                            |  |  |  | May 10, 2006     
|Allen H. Koranda                                                                                |  |  |  | (Date)           
|Chairman of the Board and Chief Executive Officer (Principal Executive Officer)                 |  |  |  |                  
|                                                                                                |  | 
|/s/ Jerry A. Weberling                                                                          |  |  |  | May 10, 2006     
|Jerry A. Weberling                                                                              |  |  |  | (Date)           
|Executive Vice President and Chief Financial Officer and Director (Principal Financial Officer) |  |  |  |                  



32



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EXHIBIT INDEX



|                 |  |                                                                                                                                                                                      
|---------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                 | 
|Exhibit No. 3.1  |  | Restated Certificate of Incorporation. (Incorporated herein by reference to Exhibit 3.1 to Registrants Form 8-K (File No. 0-18121) dated December 19, 2000.)                        
|                 | 
|Exhibit No. 3.2  |  | Amended and Restated By-laws of Registrant. (Incorporated herein by reference to Exhibit No. 3 to Registrants Form 10-Q for the period ended September 30, 2003 (File No.
0-18121).)
|                 | 
|Exhibit No. 31.1 |  | Certification of Chief Executive Officer.+                                                                                                                                           
|                 | 
|Exhibit No. 31.2 |  | Certification of Chief Financial Officer.+                                                                                                                                           
|                 | 
|Exhibit No. 32.1 |  | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.+      

---

|+ | Filed herewith.
|- | ---------------