SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q


                                QUARTERLY REPORT


                       Pursuant to Section 13 or 15 (d) of
                       The Securities Exchange Act of 1934


For the Quarter Ended: September 30, 2003    Commission File Number:  0-18392
---------------------


                                Ameriana Bancorp

Indiana                            35-1782688
-------------------------------   --------------------------------
(State or other jurisdiction of   (I.R.S. employer identification
incorporation or organization)     number)


2118 Bundy Avenue, New Castle, Indiana                       47362-1048
--------------------------------------                       ----------
(Address of principal executive offices)                     (Zip Code)


Registrant's telephone number, include area code  (765) 529-2230
                                                  --------------



                     Common Stock, par value $1.00 per share
                     ---------------------------------------
                                (Title of Class)


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  XX     NO __
                                                 --

Indicate  by check mark  whether  the  Registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

As of October 31, 2003,  there were issued and outstanding  3,148,288  shares of
the registrant's common stock.


<PAGE>

AMERIANA BANCORP AND SUBSIDIARIES



                                    CONTENTS


PART I  -  FINANCIAL INFORMATION                                      Page No.
                                                                      -------

     ITEM 1 - Financial statements

              Consolidated Condensed Balance Sheets
              as of September 30, 2003 (Unaudited)
              and December 31, 2002 . . . . . . . . . . . . . . .. . . . 3

              Consolidated Condensed Statements of Operations for
              the Three and Nine Months Ended
              September 30, 2003 and 2002 (Unaudited). . . . . . . . . . 4

              Consolidated Condensed Statement of Shareholders'
              Equity for the Nine Months Ended September 30, 2003. . . . 5
              (Unaudited)

              Consolidated Condensed Statements of Cash Flows
              for the Nine Months Ended September 30, 2003
              and 2002 (Unaudited). . . . . . . .  . . . . . . . . . . . 6

              Notes to Consolidated Condensed Financial
              Statements. . . . . . . . . . . . . . . . . . . . . . . . .7

     ITEM 2 - Management's Discussion and Analysis of
              Financial Condition and Results of
              Operations. . . . . . . . . . . . . . . . . . . . . . . . .10


     ITEM 3 - Quantitative and Qualitative Disclosure
              About Market Risk . . . . . . . . . . . . . . . . . . . . .17

     ITEM 4 - Controls and Procedures . . . . . . . . . . . . . . . . . .18

PART II  -  OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . .19

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

SIGNATURES . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . .20









                                                                               2
<PAGE>
PART I  -  FINANCIAL INFORMATION

                         AMERIANA BANCORP AND SUBSIDIARY
                      CONSOLIDATED CONDENSED BALANCE SHEETS
                        (In thousands, except share data)
<TABLE>
<CAPTION>


                                                                                         September 30,           December 31,
                                                                                             2003                    2002
                                                                                          (Unaudited)
                                                                                     ----------------------  ----------------------
<S>                                                                                             <C>                   <C>
Assets

  Cash on hand and in other institutions                                                          $  8,338                $  7,481
  Interest-bearing demand deposits                                                                  25,778                  38,215
                                                                                     ----------------------  ----------------------
      Cash and cash equivalents                                                                     34,116                  45,696

  Investment securities available for sale                                                         106,783                  58,155
  Mortgage loans available for sale                                                                  1,970                   3,825
  Loans receivable                                                                                 218,744                 313,252
  Allowance for loan losses                                                                         (3,702)                 (8,666)
                                                                                     ----------------------  ----------------------

      Net loans receivable                                                                         215,042                 304,586
  Real estate owned                                                                                    569                     489
  Premises and equipment                                                                             7,424                   7,901
  Stock in Federal Home Loan Bank                                                                    6,864                   6,759
  Mortgage servicing rights                                                                          1,323                   1,197
  Investments in unconsolidated affiliates                                                           1,562                   1,583
  Goodwill                                                                                             564                   1,291
  Cash surrender value of life insurance                                                            19,524                  18,932
  Deferred taxes                                                                                     3,327                   2,611
  Other assets                                                                                       3,184                   3,782
                                                                                     ----------------------  ----------------------

          Total assets                                                                           $ 402,252               $ 456,807
                                                                                     ======================  ======================

Liabilities and Shareholders' Equity

Liabilities:
  Deposits:
         Noninterest-bearing                                                                     $  18,882               $  19,124
         Interest-bearing                                                                          329,610                 383,063
                                                                                     ----------------------  ----------------------

            Total deposits                                                                         348,492                 402,187
  Advances from Federal Home Loan Bank                                                               4,880                   5,592
  Notes payable                                                                                        600                     840
  Drafts payable                                                                                     3,866                   5,099
  Advances by borrowers for taxes and insurance                                                        448                     380
  Other liabilities                                                                                  4,971                   3,669
                                                                                     ----------------------  ----------------------

          Total liabilities                                                                        363,257                 417,767

Commitments and contingent liabilities

Shareholders' equity:
  Preferred stock (5,000,000 shares authorized;
      none issued)                                                                                      --                      --
  Common stock ($1.OO par value; authorized
       15,000,000 shares; issued shares:
      3,148,288 and 3,147,463, respectively)                                                         3,148                   3,147
  Additional paid-in capital                                                                           506                     499
  Retained earnings                                                                                 35,148                  34,856
  Accumulated other comprehensive income (loss)                                                        193                     538
                                                                                     ----------------------  ----------------------

          Total shareholders' equity                                                                38,995                  39,040
                                                                                     ----------------------  ----------------------

          Total liabilities and shareholders' equity                                             $ 402,252               $ 456,807
                                                                                     ======================  ======================
</TABLE>

See accompanying notes to consolidated condensed financial statements.

                                                                               3
<PAGE>
                         AMERIANA BANCORP AND SUBSIDIARY
                 CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
                        (In thousands, except share data)
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                  Three Months Ended          Nine Months Ended
                                                                                     September 30,              September 30,
                                                                              ------------------------------------------------------
                                                                                 2003          2002          2003           2002
                                                                              ------------  -----------   ------------   -----------
<S>                                                                                <C>          <C>             <C>          <C>
Interest Income:
   Interest and fees on loans                                                     $ 4,664      $ 6,022       $ 15,482      $ 18,527
   Interest on investment securities                                                  793        1,072          2,150         4,047
   Other interest and dividend income                                                 179          174            604           762
                                                                              ------------  -----------   ------------   -----------

      Total interest income                                                         5,636        7,268         18,236        23,336

Interest Expense:
   Interest on deposits                                                             2,300        3,566          7,980        11,477
   Interest on FHLB advances and other borrowings                                      92          626            290         2,733
                                                                              ------------  -----------   ------------   -----------

      Total interest expense                                                        2,392        4,192          8,270        14,210
                                                                              ------------  -----------   ------------   -----------

Net interest income                                                                 3,244        3,076          9,966         9,126

Provision for Loan Losses                                                           4,790          150          6,340         1,550
                                                                              ------------  -----------   ------------   -----------

Net interest income after provision for loan losses                               (1,546)        2,926          3,626         7,576

Other Income:
   Net loan servicing fees                                                          (101)            2          (193)            87
   Other fees and service charges                                                     305          228            877           641
   Brokerage and insurance commissions                                                241          239            723           772
   Net gain (loss) on investments in unconsolidated affiliates                          3          (20)             2           (22)
   Net gain on sale of branches                                                     5,511           --          5,511            --
   Gains on sales of loans and servicing rights                                       818          289          1,771           741
   Gain (loss) on sale of investments                                                  --        1,187             41        (2,025)
   Increase in cash surrender value of life insurance                                 173          277            592           690
   Other                                                                               25           22             47           250
                                                                              ------------  -----------   ------------   -----------

      Total other income                                                            6,975        2,224          9,371         1,134

Other Expense:
   Salaries and employee benefits                                                   2,174        1,997          6,142         5,859
   Net occupancy and equipment expense                                                424          458          1,240         1,255
   Federal insurance premium                                                           48           18            143            54
   Data processing expense                                                            107           80            260           296
   Printing and office supplies                                                        74           73            188           215
   Amortization of intangible assets                                                    8            8             25            25
   Penalty on early payoff of FHLB advances                                            --        1,077             --         1,077
   Other                                                                              705          377          2,199         1,587
                                                                              ------------  -----------   ------------   -----------

      Total other expense                                                           3,540        4,088         10,197        10,368
                                                                              ------------  -----------   ------------   -----------

Income (loss) before income taxes                                                   1,889        1,062          2,800        (1,658)

Income taxes                                                                          937          276            997          (994)
                                                                              ------------  -----------   ------------   -----------

Net Income (Loss)                                                                    $952         $786        $ 1,803         $(664)
                                                                              ============  ===========   ============   ===========


Basic Earnings (Loss) Per Share                                                    $ 0.30       $ 0.25          $0.57       $ (0.21)
                                                                              ============  ===========   ============   ===========

Diluted Earnings (Loss) Per Share                                                  $ 0.30       $ 0.25          $0.57       $ (0.21)
                                                                              ============  ===========   ============   ===========

Dividends Declared Per Share                                                       $ 0.16       $ 0.16          $0.48          $0.48
                                                                              ============  ===========   ============   ===========
</TABLE>


See accompanying notes to consolidated condensed financial statements.

                                                                               4
<PAGE>



                         AMERIANA BANCORP AND SUBSIDIARY
            CONSOLIDATED CONDENSED STATEMENTS OF SHAREHOLDERS' EQUITY
                                 (In thousands)
                                   (Unaudited)

                                         2003
                                    ---------------

Balances, January 1                        $39,040

Net income                                   1,803
Other comprehensive income                    (345)
                                    ---------------
     Comprehensive income                    1,458

Purchase of common stock                        --
Exercise of stock options                        8

Dividends declared                          (1,511)
                                    ---------------

Balances, September 30                     $38,995
                                    ===============


See accompanying notes to consolidated condensed financial statements.


                                                                               5
<PAGE>




                         AMERIANA BANCORP AND SUBSIDIARY
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                 (In thousands)
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                                     Nine Months Ended
                                                                                                       September 30,
                                                                                        --------------------------------------------
                                                                                                2003                    2002
<S>                                                                                               <C>                    <C>
------------------------------------------------------------------------------------------------------------------------------------
OPERATING ACTIVITIES
------------------------------------------------------------------------------------------------------------------------------------
  Net income (loss)                                                                              $     1,803             $     (664)
  Items not requiring (providing) cash
    Provision for losses on loans
                                                                                                       6,340                  1,550
    Depreciation and amortization
                                                                                                       1,154                    668
    Increase in cash surrender value
                                                                                                        (592)                  (690)
    Mortgage loans originated for sale
                                                                                                    (190,692)               (52,443)
    Proceeds from sale of mortgage loans
                                                                                                     193,650                 53,310
    Gains on sale of loans and servicing rights
                                                                                                      (1,771)                  (741)
    Loss (Gain) on sale of investments
                                                                                                         (41)                 2,024
    Net gain on sale of branches
                                                                                                      (5,511)                    --
    Increase (decrease) in drafts payable
                                                                                                      (1,233)                   112
    Other adjustments
                                                                                                       1,787                  7,563
------------------------------------------------------------------------------------------------------------------------------------
      Net cash provided by operating activities                                                        4,894                 10,689
------------------------------------------------------------------------------------------------------------------------------------
INVESTING ACTIVITIES
------------------------------------------------------------------------------------------------------------------------------------
  Purchase of investment securities available for sale
                                                                                                    (104,103)              (131,197)
  Proceeds from sale of investment securities available for sale
                                                                                                      20,705                179,218
  Proceeds from maturities/calls of securities available for sale
                                                                                                      33,577                 30,599
  Net change in loans
                                                                                                      53,927                 15,325
  Net purchases of premises and equipment
                                                                                                        (591)                (1,382)
  Net cash paid on sale of branches
                                                                                                     (19,751)                    --
  Other investing activities
                                                                                                         301                     85
------------------------------------------------------------------------------------------------------------------------------------
    Net cash provided by (used in) investing activities                                              (15,935)                92,648
------------------------------------------------------------------------------------------------------------------------------------
FINANCING ACTIVITIES
------------------------------------------------------------------------------------------------------------------------------------
  Net change in demand and passbook deposits
                                                                                                      35,778                 13,250
  Net change in certificates of deposit
                                                                                                     (33,862)                (5,377)
  Proceeds from borrowings
                                                                                                          --                 55,812
  Repayment of borrowings
                                                                                                        (952)              (137,690)
  Purchase of common stock
                                                                                                          --                   (137)
  Exercise of stock options
                                                                                                           8                    137
  Cash dividends paid
                                                                                                      (1,511)                (2,741)
------------------------------------------------------------------------------------------------------------------------------------
    Net cash used in financing activities                                                               (539)               (76,746)
------------------------------------------------------------------------------------------------------------------------------------
CHANGE IN CASH AND CASH EQUIVALENTS
                                                                                                     (11,580)                26,591
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR
                                                                                                      45,696                 11,823
------------------------------------------------------------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS AT END OF YEAR                                                         $    34,116             $   38,414
====================================================================================================================================

Supplemental information:
  Interest paid                                                                                      $ 7,523             $   12,891
  Income taxes paid                                                                                    1,503                    290



</TABLE>

See accompanying notes to consolidated condensed financial statements.

                                                                               6
<PAGE>




AMERIANA BANCORP AND SUBSIDIARIES


NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
----------------------------------------------------
(Table dollar amounts in thousands, except share data)

NOTE A - - BASIS OF PRESENTATION

     Ameriana  Bancorp is a bank  holding  company.  Through  its  wholly  owned
subsidiary,  Ameriana Bank and Trust,  the Company  offers an extensive  line of
banking  services and provides a range of investments  and  securities  products
through branches in the central Indiana area. As its name implies, Ameriana Bank
and Trust also offers trust and investment management services. It has interests
in Family Financial Life Insurance Company and Indiana Title Insurance  Company,
and owns Ameriana Insurance Agency, a full-service insurance agency.

     The unaudited interim consolidated condensed financial statements have been
prepared in accordance with the instructions to Form 10-Q and, therefore, do not
include  all  information  and  disclosures   required  by  generally   accepted
accounting  principles  for  complete  financial  statements.  In the opinion of
management,  the financial statements reflect all adjustments (comprised only of
normal  recurring  adjustments  and  accruals)  necessary to present  fairly the
Company's  financial  position  and results of  operations  and cash flows.  The
results  of  operations  for the period are not  necessarily  indicative  of the
results to be expected in the full year. A summary of the Company's  significant
accounting  policies is set forth in Note 1 of Notes to  Consolidated  Financial
Statements  in the  Company's  annual  report  on Form  10-K for the year  ended
December 31, 2002.

     The consolidated  condensed balance sheet of the Company as of December 31,
2002 has been derived from the audited consolidated balance sheet of the Company
as of that date.


                                                                               7
<PAGE>




NOTE B - - SHAREHOLDERS' EQUITY

     On August  25,  2003,  the Board of  Directors  declared a  quarterly  cash
dividend of $.16 per share. This dividend,  totaling  $504,000,  was accrued for
payment to shareholders of record on September 12, 2003, and was paid on October
3,  2003.  Payment  was  made for  3,148,288  shares,  the same as the  previous
quarter.  Stock  options  totaling  825 shares were  exercised  during the first
quarter of 2003.

NOTE C - - EARNINGS PER SHARE

Earnings per share were computed as follows:
<TABLE>
<CAPTION>

                                                                              (In thousands, except share data)
                                                                               Three Months Ended September 30,
                                                                          2003                                 2002

                                                                          Weighted                              Weighted
                                                            Income         Average     Per Share                 Average   Per Share
                                                            (Loss)         Shares        Amount      Income      Shares      Amount
<S>                                                          <C>           <C>           <C>          <C>         <C>        <C>
Basic Earnings (Loss) per Share: Income available to            $952     3,148,288       $0.30        $786     3,147,463     $0.25
Common shareholders                                                                      =====                               =====
Effect of dilutive stock options                                  --         5,355                      --         2,300
                                                                -------------------                   ------------------
Diluted Earnings (Loss) Per Share: Income available to
common shareholders and assumed conversions                     $952     3,153,643       $0.30        $786     3,149,763     $0.25
==================================================================================================================================
</TABLE>
<TABLE>
<CAPTION>

                                                                              (In thousands, except share data)
                                                                               Nine Months Ended September 30,
-----------------------------------------------------------------------------------------------------------------------------------
                                                                          2003                                 2002
-----------------------------------------------------------------------------------------------------------------------------------
                                                                       Weighted     Per Share                 Weighted
                                                            Income      Average     Per Share    Income       Average    Per Shares
                                                            (Loss)      Shares       Amount      (Loss)       Shares      Amount
-----------------------------------------------------------------------------------------------------------------------------------
<S>                                                           <C>         <C>         <C>          <C>         <C>        <C>
Basic Earnings (Loss) per Share: Income available to         $ 1,803     3,148,122       $0.57      ($664)     3,147,246    ($0.21)
Common shareholders                                                                      =====                              ======
Effect of dilutive stock options                                  --         2,028                     --              0
                                                             ---------------------                  --------------------
Diluted Earnings (Loss) Per Share: Income available to
common shareholders and assumed conversions                  $ 1,803     3,150,150       $0.57      ($664)     3,147,246    ($0.21)
==================================================================================================================================
</TABLE>


At September 30, 2003, options to purchase 132,689 shares were excluded from the
computation  of diluted  earnings per share because the options'  exercise price
was greater than or equal to the average market price of common shares.

                                                                               8
<PAGE>

NOTE D - - Effect of Recent Accounting Pronouncements

     The Financial  Accounting  Standards  Board ("FASB")  adopted  Statement of
Financial  Accounting  Standards  ("SFAS") No. 148,  Accounting for  Stock-Based
Compensation - Transition and Disclosure.  This Statement  amends FASB Statement
No.  123,  Accounting  for  Stock-Based  Compensation.  SFAS  No.  148  provides
alternative methods of transition for a voluntary change to the fair value based
method of accounting for stock-based employee  compensation.  In addition,  SFAS
No. 148  amends  the  disclosure  requirements  of SFAS No. 123 to require  more
prominent  and more  frequent  disclosures  in  financial  statements  about the
effects of stock-based compensation.
     Under the provisions of SFAS No. 123, companies that adopted the fair value
based  method were  required to apply that  method  prospectively  for new stock
option  awards.   This   contributed  to  a  "ramp-up"   effect  on  stock-based
compensation  expense in the first few years  following  adoption,  which caused
concern  for  companies  and  investors  because of the lack of  consistency  in
reported results. To address that concern,  SFAS No. 148 provides two additional
methods of transition  that reflect an entity's full  complement of  stock-based
compensation expense immediately upon adoption,  thereby eliminating the ramp-up
effect.
     SFAS No. 148 also improves the clarity and prominence of disclosures  about
the pro forma  effects of using the fair value based  method of  accounting  for
stock-based compensation for all companies - regardless of the accounting method
used - by requiring  that the data be presented more  prominently  and in a more
user-friendly format in the footnotes to the financial statements.  In addition,
SFAS No. 148 improves the timeliness of those disclosures by requiring that this
information be included in interim as well as annual  financial  statements.  In
the past,  companies were required to make pro forma  disclosures only in annual
financial statements.
     The transition  guidance and annual  disclosure  provisions of SFAS No. 148
are  effective  for fiscal years ending  after  December 15, 2002,  with earlier
application   permitted  in  certain   circumstances.   The  interim  disclosure
provisions are effective for financial reports containing  financial  statements
for interim periods beginning after December 15, 2002.
     The  FASB has  stated  it  intends  to  issue  an  exposure  draft of a new
statement on accounting for stock-based  compensation and will require companies
to expense stock  options using a fair value based method at date of grant.  The
implementation for this proposed statement is not known.
     In  November  2002,  the FASB  issued  Interpretation  No. 45,  Guarantor's
Accounting  and  Disclosure  Requirements  for  Guarantees,  Including  Indirect
Guarantees  of  Indebtedness  of Others ("FIN 45").  FIN 45 will change  current
practice in the accounting for and disclosure of guarantees.  Guarantees meeting
the characteristics described in FIN 45 are required to be initially recorded at
fair value,  which is different from the general current practice of recording a
liability only when a loss is probable and reasonably estimable,  as those terms
are defined in FASB Statement No. 5, Accounting for  Contingencies.  FIN 45 also
requires a guarantor to make new  disclosures  for virtually all guarantees even
if the likelihood of the guarantor's having to make payments under the guarantee
is remote.
     In general, FIN 45 applies to contracts or indemnification  agreements that
contingently  require the  guarantor to make  payments to the  guaranteed  party
based on changes in an underlying asset, liability, or an equity security of the
guaranteed party such as financial standby letters of credit.
     Disclosure requirements of FIN 45 are effective for financial statements of
interim  or  annual   periods  ending  after  December  31,  2002.  The  initial
recognition and measurement  provisions are applicable on a prospective basis to
guarantees  issued or modified  after  December  31, 2002,  irrespective  of the
guarantor's fiscal year-end.  The guarantor's previous accounting for guarantees
issued prior to the date of FIN 45 initial applications should not be revised or
restated to reflect the provisions of FIN 45.
     The Company  adopted FIN 45 on January 1, 2003. The adoption of FIN 45 does
not currently  have a material  impact on the Company's  consolidated  financial
statements.

                                                                               9
<PAGE>

AMERIANA BANCORP AND SUBSIDIARIES


ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                  AND RESULTS OF OPERATIONS


General
-------

     This  Quarterly  Report on Form 10-Q ("Form 10-Q") may contain  statements,
which constitute  forward-looking  statements  within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements appear in a number of
places in this Form 10-Q and include  statements  regarding the intent,  belief,
outlook,  estimate or  expectations  of the Company  primarily  with  respect to
future events and future  financial  performance.  Readers of this Form 10-Q are
cautioned that any such forward looking  statements are not guarantees of future
events or  performance  and  involve  risks and  uncertainties,  and that actual
results may differ materially from those in the forward looking  statements as a
result of various factors. The accompanying  information  contained in this Form
10-Q  identifies  important  factors  that could cause such  differences.  These
factors include  changes in interest rates;  loss of deposits and loan demand to
other financial institutions;  substantial changes in financial markets; changes
in real estate values and the real estate market or regulatory changes.
     The largest  components of the Company's  total revenue and total  expenses
are  interest  income and  interest  expense,  respectively.  Consequently,  the
Company's earnings are primarily dependent on its net interest income,  which is
determined  by  (i)  the  difference   between  rates  of  interest   earned  on
interest-earning   assets  and  rates  paid  on   interest-bearing   liabilities
("interest  rate  spread"),  and (ii) the relative  amounts of  interest-earning
assets and  interest-bearing  liabilities.  Levels of other income and operating
expenses also significantly affect net income.
     Management  believes that interest  rate risk,  i. e., the  sensitivity  of
income and net asset  values to changes in  interest  rates,  is one of the most
significant  determinants of the Company's  ability to generate future earnings.
Accordingly,  the Company has implemented a long-range plan intended to minimize
the effect of changes in interest rates on  operations.  The asset and liability
management  policies of the Company are  designed  to  stabilize  long-term  net
interest income by managing the repricing  terms,  rates and relative amounts of
interest-earning assets and interest-bearing liabilities.

Sale of Two Cincinnati Branches
-------------------------------

     On April 7, 2003, the Company  announced that it had agreed to sell its two
Cincinnati-area   branches  to  Peoples  Community  Bancorp,   Inc.  (NASDAQ/NM:
PCBI)("PCBI")  of West Chester,  Ohio. The two branches are located in Deer Park
and Landen, Ohio. On September 30, 2003, the Company announced the completion of
the sale of the two branches to PCBI. In connection  with the sale,  the Company
recorded an  after-tax  gain of  approximately  $2,930,000  or $0.93 per diluted
share in the third quarter 2003.
     The  transaction  included the Company's real property  related to the Deer
Park  branch  and  its  leasehold  on  the  premises  for  the  Landen   branch.
Additionally,  the Company  conveyed most consumer and commercial loans at those
branches as part of the  transaction,  as well as the branches' saving deposits,
but retained and will  continue to service  certain  single  family  residential
mortgages originated in those locations.

Company Writes Off Troubled Lease Portfolio
-------------------------------------------

     On September 30, 2003 the Company  charged-off  the two troubled  equipment
leases ("lease  pools")  originated by Commercial  Money Center  ("CMC"),  a now
bankrupt  company.  The Company  recorded  an  after-tax  loss of  approximately
$2,784,000 or $0.88 per diluted share.  Prior to September 30, 2003, the Company
had established reserves against these lease pools equal to approximately 58% of
the approximately $10,900,000 that currently remains outstanding.

                                                                              10
<PAGE>



Critical Accounting Policies
----------------------------

     The  notes  to  the  consolidated  financial  statements  included  in  the
Company's  2002 annual  report  contain a summary of the  Company's  significant
accounting policies. Certain of these policies are important to the portrayal of
the  Company's  financial  condition,  since  they  require  management  to make
difficult,  complex or subjective judgments, some of which may relate to matters
that are inherently uncertain.  Management believes that its critical accounting
policies  include  determining  the allowance for loan losses  ("ALL"),  and the
valuation  of  mortgage  servicing  rights,  ("MSR's"),  and the way the Company
accounts for goodwill and other intangibles.

Allowance for Loan Losses
-------------------------

     The  allowance  for loan  losses  provides  coverage  for  probable  losses
inherent in the Company's loan portfolio.  Management  evaluates the adequacy of
the  allowance  for credit  losses each  quarter  based on  changes,  if any, in
underwriting  activities,  the loan portfolio composition (including product mix
and geographic,  industry or customer-specific  concentrations),  trends in loan
performance,  regulatory  guidance  and economic  factors.  This  evaluation  is
inherently  subjective,  as  it  requires  the  use  of  significant  management
estimates.  Many  factors can affect  management's  estimates  of  specific  and
expected  losses,   including  volatility  of  default   probabilities,   rating
migrations,  loss severity and economic and political conditions.  The allowance
is increased through provisions charged to operating earnings and reduced by net
charge-offs.
     The Company  determines the amount of the allowance  based on relative risk
characteristics  of the loan  portfolio.  The allowance  recorded for commercial
loans is based on reviews of individual credit  relationships and an analysis of
the  migration of  commercial  loans and actual loss  experience.  The allowance
recorded  for  homogeneous  consumer  loans is based on an analysis of loan mix,
risk  characteristics of the portfolio,  fraud loss and bankruptcy  experiences,
and  historical  losses,  adjusted  for  current  trends,  for each  homogeneous
category or group of loans. The allowance for credit losses relating to impaired
loans is based on the loan's observable market price, the collateral for certain
collateral-dependent  loans,  or the  discounted  cash  flows  using the  loan's
effective interest rate.
     Regardless of the extent of the Company's analysis of customer performance,
portfolio trends or risk management  processes,  certain inherent but undetected
losses are probable  within the loan  portfolio.  This is due to several factors
including  inherent  delays in  obtaining  information  regarding  a  customer's
financial  condition  or  changes  in  their  unique  business  conditions,  the
judgmental nature of individual loan evaluations, collateral assessments and the
interpretation of economic trends.  Volatility of economic or  customer-specific
conditions  affecting  the  identification  and  estimation of losses for larger
non-homogeneous credits and the sensitivity of assumptions utilized to establish
allowances for homogenous  groups of loans are among other factors.  The Company
estimates  a  range  of  inherent  losses  related  to the  existence  of  these
exposures.  The estimates are based upon the Company's evaluation of imprecision
risk  associated  with the  commercial  and  consumer  allowance  levels and the
estimated impact of the current economic environment.

Valuation of Mortgage Servicing Rights
--------------------------------------

     MSR's  associated  with  loans  originated  and sold,  where  servicing  is
retained,  are  capitalized  and  included  in other  intangible  assets  in the
consolidated  balance  sheet.  The  value of the  capitalized  servicing  rights
represents the present value of the future servicing fees arising from the right
to service loans in the portfolio.  Critical accounting policies for MSRs relate
to the initial  valuation and subsequent  impairment tests. The methodology used
to determine the valuation of MSRs requires the  development and use of a number
of estimates,  including anticipated  principal  amortization and prepayments of
that principal balance.  Events that may significantly affect the estimates used
are changes in interest rates,  mortgage loan prepayment  speeds and the payment
performance  of  the  underlying  loans.  The  carrying  value  of the  MSRs  is
periodically  reviewed for impairment  based on a  determination  of fair value.
Impairment,  if any, is recognized through a valuation allowance and is recorded
as amortization of intangible assets.



                                                                              11
<PAGE>

Goodwill and Other Intangibles
------------------------------

     The  Company  records  all  assets and  liabilities  acquired  in  purchase
acquisitions,  including  goodwill  and  other  intangibles,  at fair  value  as
required by SFAS 141.  Goodwill is subject,  at a minimum,  to annual  tests for
impairment.  Other  intangible  assets are amortized over their estimated useful
lives using straight-line and accelerated methods, and are subject to impairment
if events or circumstances indicate a possible inability to realize the carrying
amount.  The initial  goodwill and other  intangibles  recorded  and  subsequent
impairment analysis requires management to make subjective  judgments concerning
estimates  of how the  acquired  asset will  perform in the  future.  Events and
factors that may  significantly  affect the  estimates  include,  among  others,
customer  attrition,   changes  in  revenue  growth  trends,  specific  industry
conditions and changes in competition.
     The  Cincinnati  branches  sold  had  approximately  $890,000  recorded  as
goodwill and core deposit  intangibles.  The $890,000 was written-off and netted
against the gain on the sale of the branches.

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

     Total assets  decreased  $54,555,000 to $402,252,000 or 11.94% at September
30,  2003 from  $456,807,000  at  December  31,  2002.  The main  reason for the
decrease was due to deposits conveyed in the sale of the Cincinnati branches.
     Cash and cash equivalents  decreased $11,580,000 or 25.34% during the first
nine months of 2003 to  $34,116,000  from  $45,696,000 at December 31, 2002. The
main reason for the decrease was due to the purchase of investment securities.
     Investment  securities  available for sale increased  $48,628,000 or 83.62%
during  the  first  nine  months of 2003 to  $106,783,000  from  $58,155,000  at
December  31,  2002.  The  funding  for the  increase  came from  loan  payoffs,
deposits, and cash and cash equivalents.
     Total net loans  decreased  $89,544,000  or 29.40%  during  the first  nine
months of 2003 to  $215,042,000  from  $304,586,000  at December 31,  2002.  The
decline was due to mortgage loan  refinancing  and the subsequent  sale of those
loans,  the  charge-off of the two lease pools,  and loans conveyed to PCBI from
the Cincinnati  branches sale, which consisted of  approximately  $28,847,000 of
commercial and consumer loans.
     Deposits  decreased  $53,695,000  or 13.35% during the first nine months of
2003 to  $348,492,000  from  $402,187,000  at December 31, 2002. The decline was
mainly due to deposits conveyed to PCBI from the Cincinnati branches sale, which
consisted of  approximately  $55,611,000  of deposits.  Excluding the Cincinnati
branches sale, deposits increased approximately $2,000,000.
     The  Company's   principal   sources  of  funds  are  cash  generated  from
operations, deposits, loan principal repayments,  investments, and advances from
the Federal Home Loan Bank ("FHLB").
     The  Bank's  capital  ratios  are  well in  excess  of  minimum  regulatory
requirements.  At September 30, 2003, the Bank had a risk-based capital ratio of
15.57% and a tier 1 capital ratio of 8.10%.
     At September  30, 2003 and December 31, 2002,  the Company had  outstanding
commitments to originate  loans of  approximately  $9,094,000  and  $15,439,000,
which  were  primarily  for  adjustable-rate   mortgages  with  rates  that  are
determined just prior to closing or fixed-rate  mortgage loans with rates locked
in at the time of loan  commitment.  The Company had $22,513,000 and $23,580,000
of conditional commitments for lines of credit receivables at September 30, 2003
and December 31, 2002.  Unused draws against  construction  and commercial  loan
commitments totaled $7,146,000 and $8,863,000 at September 30, 2003 and December
31, 2002.


                                                                              12
<PAGE>




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

     Net income for the third quarter of 2003 was $952,000, or $0.30 per diluted
share  compared to $786,000  or $0.25 per  diluted  share  reported in the third
quarter of 2002.  The higher  earnings in the third  quarter of 2003 were mainly
due to the sale of the Cincinnati branches less the additional provision expense
necessary to charge-off the lease pools.
     For the  first  nine  months  of 2003,  the  Company  incurred  a profit of
$1,803,000  or $0.57 per diluted  share  compared with a net loss of $664,000 or
$0.21 per diluted  share in the  year-earlier  period.  The loss in 2002 largely
reflected charges in the first quarter of the year related to the liquidation of
its investment portfolio and the increase in reserves for loan and lease losses.
Net interest income for the first nine months of 2003 was $9,966,000 compared to
$9,126,000  in the  comparable  period  last year,  an  increase  of 9.20%.  The
provision for loan and lease losses was  $6,340,000 for the first nine months of
2003 compared with $1,550,000 in the  year-earlier  period.  The majority of the
provision expense in 2003 was due to the charge-off of the two lease pools while
the prior period  provision  expense was higher than expected due to an increase
in non-performing loans.
     The Bank's interest rate position at year-end 2001 exceeded the Bank's risk
parameters,  primarily  due to  collateralized  mortgage  obligations  that were
particularly  volatile.  The Company disposed of most of its investments  during
the first  quarter of 2002.  The loss on  disposition  of these  securities  was
approximately  $3,212,000,  or  approximately  $1,900,000 after tax or $0.61 per
diluted share.  The funds from the  investments  liquidation  were  subsequently
reinvested  in the first and  second  quarter  of 2002 in  instruments  that are
thought to be less interest-rate  sensitive,  or were used to pay down a portion
of funds borrowed from the Federal Home Loan Bank.
     The Company  adjusted the balance  sheet  through the sale of an additional
$44,601,000  of  investments in the third quarter of 2002 with the proceeds from
this latest  investment sale were used to prepay  higher-rate  Federal Home Loan
Bank advances. As discussed below, these transactions improved the Company's net
interest  margin  through the reduction of higher rate debt using  proceeds from
the sale of lower earning investments.
     The following table summarizes the Company's  average net  interest-earning
assets and average  interest-bearing  liabilities with the accompanying  average
rates for the third quarter and first nine months of 2003 and 2002:
<TABLE>
<CAPTION>


                                                                         (Dollars in Thousands)
                                                     Three Months Ended September 30,  Nine Months Ended September 30,
                                                    ------------------------------------------------------------------
                                                          2003            2002             2003           2002
<S>                                                       <C>               <C>             <C>              <C>

Average interest-earning assets                            $ 424,948       $468,023         $429,475       $487,870
Average interest-bearing liabilities                       $ 395,797       $435,915         $396,598       $455,055
                                                     -------------------------------  ------------------------------

   Net interest-earning assets                               $29,151       $ 32,108         $ 32,877       $ 32,815
                                                     ===============================  ==============================

Average yield on/cost of:
Interest-earning assets                                        5.26%          6.16%            5.68%          6.40%
Interest-bearing liabilities                                   2.40%          3.82%            2.79%          4.18%
                                                     -------------------------------  ------------------------------

   Net interest spread                                         2.86%          2.34%            2.89%          2.22%
                                                     ===============================  ==============================

</TABLE>


     Net interest  income for the third  quarter of 2003 was  $3,244,000  for an
increase of $168,000 or 5.46%  compared to $3,076,000  recorded  during the same
period  in  2002.  The  net  interest  spread   (difference   between  yield  on
interest-earning  assets and cost on interest-bearing  liabilities) increased 52
basis points  during the third  quarter of 2003 compared to the third quarter of
2002.  The  change is due to a decrease  in yield of 90 basis  points on average
interest-earning  assets  offset by a 142 basis point  reduction  in the cost of
interest-bearing  average  liabilities.  The  change in  interest  rate  spreads
resulted in a decrease of interest income offset by lower interest expense.  The





                                                                              13
<PAGE>

$1,632,000 decrease in interest income on average interest-earning assets in the
third  quarter of 2003 is a  combination  of a decrease of  $669,000  because of
lower  average  balances  and  $963,000  due to lower  rates.  The  decrease  of
$1,800,000 in cost of interest-bearing  liabilities in the third quarter of 2003
is a  combination  of a decrease of $385,000  from lower  average  balances  and
$1,415,000  from  lower  rates.  The net  interest  margin  ratio,  which is net
interest income divided by average  earning  assets,  increased to 3.03% for the
third  quarter  of 2003  compared  to 2.61%  for the same  period  in 2002.
     Net interest income for the first nine months of 2003 was $9,966,000 for an
increase of $840,000 or 9.20%  compared to $9,126,000  recorded  during the same
period  in  2002.  The  net  interest  spread   (difference   between  yield  on
interest-earning  assets and cost on interest-bearing  liabilities) increased 67
basis points during the first nine months of 2003 compared to the same period in
2002.  The  change is due to a decrease  in yield of 72 basis  points on average
interest-earning  assets  offset by a 139 basis point  reduction  in the cost of
interest-bearing  average  liabilities.  The  change in  interest  rate  spreads
resulted in a decrease in interest income offset by lower interest expense.  The
$5,100,000  decrease in interest income on average  interest-earning  assets for
the first  nine  months of 2003 is a  combination  of a decrease  of  $2,793,000
because of a decline in average  balances and $2,307,000 due to lower rates. The
decrease of $5,940,000  in cost of  interest-bearing  liabilities  for the first
nine  months of 2003 is a  combination  of a decrease of  $1,825,000  from lower
average balances and $4,115,000 from lower rates. The net interest margin ratio,
which is net interest  income divided by average  earning  assets,  increased to
3.10% for the first nine months of 2003 compared to 2.50% for the same period in
2002.
     The following table sets forth the impact of rate and volume changes on net
interest  income for the three and nine months ended September 30, 2003 compared
to the same periods in 2002.
<TABLE>
<CAPTION>
                                                                            (Dollars in Thousands)
                                                Three Months Ended September 30,              Nine Months Ended September 30,
                                                          2003 vs 2002                                  2003 vs 2002
                                                      Increase (Decrease)                           Increase (Decrease)
                                                        Due to Change in                              Due to Change in

                                             Volume          Rate        Net Change        Volume           Rate         Net Change
                                           ------------   ------------  --------------  --------------  -------------   ------------
<S>                                             <C>             <C>           <C>            <C>               <C>          <C>
Interest-earning assets                         $(669)         $(963)       $ (1,632)       $ (2,793)      $ (2,307)       $ (5,100)
Interest-bearing liabilities                     (385)        (1,415)         (1,800)         (1,825)        (4,115)         (5,940)
                                           ------------   ------------  --------------  --------------  -------------   ------------
Change in net interest income                   $(284)          $ 452           $ 168         $ (968)         $1,808       $    840
                                           ============   ============  ==============  ==============  =============   ============
</TABLE>


The following table summarizes the Company's  non-performing assets at September
30, 2003 and December 31, 2002:
<TABLE>
<CAPTION>

                                                                        Dollars in Thousands
                                                                   September 30,      December 31,
                                                                       2003                2002
<S>                                                                     <C>                 <C>
Loans:
Non-accrual                                                            $ 7,924           $ 18,307
Restructured Loans                                                                            485

Over 90 days delinquent and still accruing                               1,337                135
Real estate owned                                                          569                489
                                                             ------------------ -----------------

Total                                                                  $ 9,830           $ 19,416
                                                             ================== =================


</TABLE>

                                                                              14
<PAGE>

     The Company's  non-performing assets decreased $9,586,000 in the first nine
months of 2003 primarily due to the charge-off of the lease pools.
     Non-performing  assets grew  substantially in 2002. The main causes for the
increase are related loans to a builder/developer  and the aforementioned  lease
pools.
     The Bank has a number  of real  estate  development/lot  loans  and  single
family residential loans on existing properties with a builder/developer  group,
and its related parties, that are currently in default and bankruptcy.  The Bank
is working closely with the workout  specialist hired by the bankruptcy  trustee
on liquidation  of the properties  involved in the bankruptcy and is negotiating
with the borrower and its counsel for  resolution of the  remaining  properties.
The total  outstanding  balance of the various  loans totaled $3.6 million as of
September 30, 2003 and December 31, 2002.
     The Bank is involved in a variety of  litigation  relating to its interests
in the two pools of equipment leases  originated by the Commercial Money Center,
Inc.  ("CMC"),  a  California  based  equipment-leasing  company  that is now in
bankruptcy.
     In June and September  2001, the Bank purchased two separate pools of lease
receivables totaling $12,003,000, consisting primarily of equipment leases. Each
lease  within  each pool was  supported  by a surety  bond  issued by one of two
insurance  companies rated at least "A" by Moody's.  The bonds guarantee payment
of all amounts due under the leases in the event of default by the lessee.  Each
pool was sold by the terms of a Sales and  Servicing  Agreement  which  provides
that the  insurers  will  service the  leases.  In each case the  insurers  have
assigned  their  servicing  rights and  responsibilities  to Commercial  Service
Center, a company, which has now filed bankruptcy.
     When the lease pools went into  default,  notice was given to each insurer.
One of them made  payments for a few months under a reservation  of rights;  the
other paid nothing.  Both insurers claim they were defrauded by Commercial Money
Center  (CMC),  the  company  which sold the lease  pools.  Both are now denying
responsibility for payment. CMC has also filed for bankruptcy protection.
     Many other financial  institutions have purchased lease pools from CMC. All
of the lease pools are in default and in litigation.  The Panel on Multidistrict
Litigation  has taken  control of the many actions and assigned them to the U.S.
District Court for the Northern District of Ohio, Eastern Division.  All parties
are conducting discovery. No trial date has been set.
     The Bank has also been named as a  defendant  in a suit filed by a group of
lessees in  California  state court against CMC, CSC, the banks that invested in
the CMC pools and the  insurers  that issued the surety  bonds on the CMC pools.
The  California  suit alleges  that the leases are  usurious and  un-collectable
under  California law. None of the plaintiffs in the California suit is a lessee
in either of the lease pools purchased by the Bank.
     The Company believes the surety bonds are enforceable against the insurers.
The current unpaid balance for the pools is  $10,900,000.  It is highly unlikely
that the litigation will be resolved in 2003.
     The lease pools had reserves of approximately 50% at December 31, 2002. Due
to the  downgrade  of one of the  sureties  to "D" by A.M.  Best,  the  inherent
uncertainty  surrounding the potential for recovery, the Company charged-off the
two lease pools during the third quarter of 2003. The Company  believes that the
charge-off of these lease pools is consistent with the conservative posture that
banking industry regulators will likely assume in this matter.

                                                                              15
<PAGE>

     Net charge-offs (charge-offs less recoveries) were $11,304,000 and $206,000
for the first nine months of 2003 and 2002  respectively.  Net charge-offs  were
$10,945,000  and $137,000 for the third  quarter of 2003 and 2002  respectively.
The main reason for the large  charge-offs for the third quarter of 2003 and the
first nine  months of 2003 are due to the  $10,900,000  charge-off  of the lease
pools.
     Management  believes  the  allowance  for loan losses is adequate  and that
sufficient  provision  has been made to absorb  losses  that may  ultimately  be
incurred on  non-performing  loans and the remainder of the  portfolio  based on
information at September 30, 2003. The allowance for loan losses as a percentage
of loans was 1.69%  and 2.77% at  September  30,  2003 and  December  31,  2002,
respectively.
     Total other income  increased  $8,237,000 to $9,371,000  for the first nine
months of 2003 from  $1,134,000 in the same period during 2002. The gain on sale
of the Cincinnati  branches in September 2003 was  $5,511,000.  Management  sold
investments  for a net loss of  $3,212,000 in the first quarter of 2002 that was
offset  by a gain  on  sale  of  investments  in the  third  quarter  of 2002 of
$1,188,000,  which were the primary  causes for the low level of other income in
2002.  Gains on sales of loans and servicing rights for the first nine months of
2003  increased  $1,030,000 to $1,771,000  compared to $741,000 for the previous
period in 2002.  The  increase  was due to higher  mortgage  loan  re-financings
spurred by low  interest  rates and the  subsequent  sale of these loans in 2003
than the same period in 2002.
     Total other income increased $4,751,000 to $6,975,000 for the third quarter
2003  from  $2,224,000  in the  same  period  during  2002.  The sale of the two
Cincinnati  branches was the main cause for the  increase  offset by the gain on
sale of  investments  in the third quarter of 2002.  Gains on sales of loans and
servicing  rights to the secondary market were $818,000 for the third quarter of
2003 compared to a net gain of $289,000 for the same period in 2002.
     Total other expense  decreased  $171,000 to $10,197,000  for the first nine
months of 2003 from  $10,368,000  in the same  period in 2002.  Expenses in 2002
included $1,077,000 for penalties on early pay-off of FHLB advances.  Salary and
benefits  expense was  $6,142,000  for the first nine months of 2003 compared to
$5,859,000  in the same  period  during  2002.  Severance  pay of  $289,000  was
incurred in the first quarter 2002.  Merit pay  adjustments,  pension costs, and
higher  health  care  costs  during the first  nine  months of 2003,  as well as
increased  staffing  in the last half of 2002,  resulted  in higher  salary  and
benefit expense from the same period in 2002.
     Total  other  expense in the third  quarter of 2003  decreased  $548,000 to
$3,540,000  compared to $4,088,000 for the same period in 2002.  Expenses in the
second quarter of 2002 included the $1,077,000 for penalties on early pay-off of
FHLB  advances.  Salary and benefits  expense for the third  quarter of 2003 was
$2,174,000  compared to  $1,997,000  in the same period  during 2002.  Merit pay
adjustments, pension costs, and higher health care costs during 2003 resulted in
higher salary and benefit expense from the same period in 2002.
     The Company  recorded an income tax expense of $997,000  for the first nine
months of 2003  compared  to a tax  benefit of  $994,000  for the same period in
2002.  Income tax expense was $937,000 in the third  quarter of 2003 compared to
$276,000 in the third quarter of 2002.
     The effective tax rates and the statutory tax rates differ primarily to tax
credits, cash value of life insurance, and a reduction in state tax expense. The
high  effective  tax rates  through  September 30, 2003 and the third quarter of
2003 were mainly due to the write-off of approximately  $890,000 of goodwill and
core deposit  intangibles  associated with the sale of the Cincinnati  branches,
which is not tax deductible.

OTHER
-----

The  Securities  and  Exchange  Commission  ("SEC")  maintains  reports,   proxy
information,  statements and other information  regarding  registrants that file
electronically   with  the  SEC,   including   the   Company.   The  address  is
(http://www.sec.gov).


                                                                              16
<PAGE>

ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

The  Asset/Liability  Committee and the Board of Directors reviews the Company's
exposure to interest  rate  changes and market risk on a quarterly  basis.  This
review is accomplished by the use of a cash flow simulation model using detailed
securities,  loan and deposit,  and market information to estimate the potential
impact of interest  rate  increases  and  decreases  on the  earning  assets and
liabilities. The model tests the impact on the net interest income under various
interest rate scenarios by estimating the interest rate sensitivity  position at
each interest rate  interval.  The change in the net portfolio  value ("NPV") is
also  calculated at each interest  rate  interval.  This tests the interest rate
risk exposure from  movements in interest  rates by using  interest  sensitivity
analysis to determine the change in the NPV of discounted cash flows from assets
and liabilities.

NPV  represents  the  market  value  of  portfolio  equity  and is  equal to the
estimated   market  value  of  assets  minus  the  estimated   market  value  of
liabilities.  The model uses a number of  assumptions,  including  the  relative
levels of market  interest  rates and  prepayments in mortgage loans and certain
types of callable investments. These computations do not contemplate any actions
management may undertake to reposition the assets and liabilities in response to
changes in the interest  rate,  and should not be relied upon as  indicative  of
actual results. In addition,  certain  shortcomings are inherent in the model of
computing NPV.  Should  interest rates remain or decrease below present  levels,
the portion of  adjustable  rate loans could  decrease in future  periods due to
loan  refinancing or payoff  activity.  In the event of an interest rate change,
pre-payment levels would likely be different from those assumed in the model and
the ability of  borrowers  to repay  their  adjustable  rate loans may  decrease
during rising interest rate environments.

Presented  below is the assessment of the risk of NPV in the event of sudden and
sustained  200 and 100 basis point  increases  and  decreases  respectively,  in
prevailing interest rates as of September 30, 2003.
<TABLE>
<CAPTION>

                                                                                                        NPV as Percent of
                                    Net Portfolio Value                                              Present Value of Assets
------------------------------------------------------------------------------------------------------------------------------------
    Change in Rates           Dollar Amount           Dollar Change        Percent Change         NPV Ratio             Change
------------------------------------------------------------------------------------------------------------------------------------
<S>                                  <C>                  <C>                      <C>                <C>                  <C>
                                                           (Dollars in thousands)
------------------------------------------------------------------------------------------------------------------------------------
+200 bp*                                $ 38,846               $ (3,045)              (7.27)               9.83%           -48 bp*
Base or 0%                                41,891                                                          10.31
-100 bp*                                  43,637                  1,746                4.17               10.59             28 bp*
------------------------------------------------------------------------------------------------------------------------------------
* basis points
</TABLE>

Presented  below is the assessment of the risk of NPV in the event of sudden and
sustained  200 and 100 basis  point  increases  and  decreases  respectively  in
prevailing interest rates as of December 31, 2002.
<TABLE>
<CAPTION>

                                                                                                       NPV as Percent of
                                   Net Portfolio Value                                              Present Value of Assets
------------------------------------------------------------------------------------------------------------------------------------
    Change in Rates          Dollar Amount         Dollar Change        Percent Change          NPV Ratio              Change
------------------------------------------------------------------------------------------------------------------------------------
<S>                             <C>                  <C>                      <C>                <C>                    <C>
                             (Dollars in thousands)
------------------------------------------------------------------------------------------------------------------------------------
+200 bp*                              $ 39,952             $ (2,859)                (6.68)                9.65%             (43) bp*
Base or 0%                              42,811                   --                    --                10.08               --
-100 bp*                                41,054               (1,757)                (4.10)                9.61              (47) bp*
------------------------------------------------------------------------------------------------------------------------------------
* basis points
</TABLE>

                                                                              17
<PAGE>



ITEM 4 - CONTROLS AND PROCEDURES

As of the end of the period  covered by this report,  management  of the Company
carried out an evaluation,  under the supervision and with the  participation of
the Company's  principal  executive officer and principal  financial officer, of
the effectiveness of the Company's disclosure controls and procedures.  Based on
this  evaluation,  the  Company's  principal  executive  officer  and  principal
financial  officer  concluded  that  the  Company's   disclosure   controls  and
procedures are effective in ensuring that  information  required to be disclosed
by the Company in reports that it files or submits under the Securities Exchange
Act of 1934, as amended, is recorded, processed, summarized and reported, within
the time periods specified in the Securities and Exchange Commission's rules and
forms. It should be noted that the design of the Company's  disclosure  controls
and procedures is based in part upon certain  reasonable  assumptions  about the
likelihood of future events,  and there can be no reasonable  assurance that any
design of  disclosure  controls and  procedures  will  succeed in achieving  its
stated goals under all potential  future  conditions,  regardless of how remote,
but the Company's principal executive and financial officers have concluded that
the Company's  disclosure  controls and procedures are, in fact,  effective at a
reasonable assurance level.

In addition,  there have been no changes in the Company's  internal control over
financial  reporting  (to the extent  that  elements of  internal  control  over
financial  reporting are subsumed  within  disclosure  controls and  procedures)
identified in connection  with the evaluation  described in the above  paragraph
that occurred  during the Company's  last fiscal  quarter,  that has  materially
affected,  or is reasonably likely to materially  affect, the Company's internal
control over financial reporting.


                                                                              18
<PAGE>
PART II - OTHER INFORMATION


ITEM 1  -  Legal Proceedings
           -----------------

           Not Applicable


ITEM 2  -  Changes in Securities
           ---------------------

           Not Applicable

ITEM 3  -  Defaults in Senior Securities
           -----------------------------

           Not Applicable


ITEM 4  -  Submission of Matters to a Vote of Security Holders
           ---------------------------------------------------

           Not Applicable

ITEM 5  -  Other Information
           -----------------

           Not Applicable

ITEM 6  -  Exhibits and Reports on Form 8-K
           --------------------------------

          a.   Exhibits.

               The following exhibits are filed with this report:

               No.   Description
               ---   -----------

               Exhibit 31, Rule 13a-14(a) Certifications

               Exhibit 32, Section 1350 Certifications

          b.   Current Reports on Form 8-K
               ---------------------------

               On July 14, 2003,  the Company filed a current report on Form 8-K
               announcing additional reserves of approximately $1.25 million the
               Company set aside in the second quarter.

               On August 5,  2003,  the  Company  filed a Current  Report on 8-K
               reporting under Item 12 its unaudited  financial  results for the
               quarter  ended June 30,  2003.  A copy of the press  release  was
               attached to this Report as an exhibit.

               On September 30, 2003, the Company filed a current report on Form
               8-K that announced the completed sale of its two Cincinnati  area
               branches to Peoples Community Bancorp.  As a separate matter, the
               Company also announced that it was writing off two lease pools in
               the third quarter.


                                                                              19
<PAGE>




SIGNATURES


AMERIANA BANCORP AND SUBSIDIARIES


Pursuant to the requirements of Section 13 or 15 (d) 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.


                                      AMERIANA BANCORP




DATE: November 14, 2003           /s/ Harry J. Bailey
      -----------------           --------------------------------
                                  Harry J. Bailey
                                  President and
                                  Chief Executive Officer
                                  (Duly Authorized Representative)



DATE: November 14, 2003           /s/ Bradley L. Smith
      -----------------           -------------------------------
                                  Bradley L. Smith
                                  Senior Vice President-Treasurer
                                  (Principal Financial Officer
                                  and Accounting Officer)

                                                                              20