<PAGE>   1


                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549


                                   FORM 10-Q/A


                   Quarterly Report Under Section 13 or 15(d)
                     of the Securities Exchange Act of 1934


For Quarter Ended March 31, 2000                  Commission File Number 0-22224
--------------------------------------------------------------------------------

                              LEDGER CAPITAL CORP.
                   (formerly known as Hallmark Capital Corp.)
             (Exact name of registrant as specified in its charter)

       Wisconsin                                         39-1762467
(State of Incorporation)                    (I.R.S. Employer Identification No.)


    5555 N. Port Washington Road
         Glendale, Wisconsin                               53217
(Address of principal executive offices)                 (Zip Code)


                  Registrant's telephone number: (414) 290-7900
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.



                        (1)  Yes  [X]             No  [_]
                        (2)  Yes  [X]             No  [_]

The number of shares outstanding of the issuer's common stock, par value $1.00
per share, was 2,435,141 at November 10, 2000, the latest practicable date.


<PAGE>   2


                     HALLMARK CAPITAL CORP. AND SUBSIDIARY
                                   FORM 10-Q/A

Part I.  Financial Information

<TABLE>
<C>               <S>                                                                    <C>

         Item 1.  Financial Statements (unaudited):

                  Consolidated Statements of Financial Condition
                     as of March 31, 2000 and June 30, 1999 (unaudited)................   1

                  Consolidated Statements of Income for the Three and Nine Months
                     ended March 31, 2000 and 1999 (unaudited).........................   2

                  Consolidated Statements of Shareholders' Equity for the Nine
                     Months ended March 31, 2000 and 1999 (unaudited)..................   3

                  Consolidated Statements of Cash Flows for the Nine Months
                     ended March 31, 2000 and 1999 (unaudited).........................   4

                  Notes to Consolidated Financial Statements (unaudited)...............   6


         Item 2.  Management's Discussion and Analysis of Financial Condition
                     and Results of Operations.........................................  13


         Item 3.  Quantitative and Qualitative Disclosure About Market Risk............  32
</TABLE>


Part II. Other Information

<TABLE>
<C>               <S>                                                                    <C>
         Item 1.  Legal Proceedings....................................................  33

         Item 2.  Changes in Securities and Use of Proceeds............................  33

         Item 3.  Defaults Upon Senior Securities......................................  33

         Item 4.  Submission of Matters to a Vote of Security Holders..................  33

         Item 5.  Other Information....................................................  33

         Item 6.  Exhibits and Reports on Form 8-K.....................................  33

                  Signature Page.......................................................  36
</TABLE>




<PAGE>   3



                       LEDGER CAPITAL CORP. AND SUBSIDIARY
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                    (Dollars in thousands, except share data)
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                              MARCH 31,     JUNE 30,
                                                                                2000          1999
                                                                             ----------    ---------
ASSETS                                                                       (Restated)

<S>                                                                           <C>          <C>
Cash and non-interest bearing deposits.....................................   $  2,731     $  3,582
Interest-bearing deposits..................................................      7,755        5,017
                                                                              --------     --------
Cash and cash equivalents..................................................     10,486        8,599

Securities available-for-sale (at fair value):

  Investment securities....................................................     38,252       44,902
  Mortgage-backed and related securities...................................     39,828       55,566
Securities held-to-maturity:
  Mortgage-backed and related securities (fair value -
   $15,233 at March 31, 2000; $54,854 at June 30, 1999)....................     15,627       54,618
Loans held for sale, at lower of cost or market............................     13,775        6,437
Loans receivable, net......................................................    375,077      281,120
Investment  in Federal Home Loan Bank stock, at cost.......................      7,627        6,527
Foreclosed properties, net.................................................        960          621
Office properties and equipment............................................      5,533        5,771
Prepaid expenses and other assets..........................................      7,210        5,498
                                                                              --------     --------
          Total assets.....................................................   $514,375     $469,659
                                                                              ========     ========

LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:
  Deposits.................................................................   $331,796     $288,714
  Notes payable and other borrowings.......................................    141,784      129,519
  Advance payments by borrowers for taxes and insurance....................      1,993        3,225
  Accrued interest on deposit accounts and other borrowings................      3,808        2,006
  Accrued expenses and other liabilities...................................      2,088       11,699
                                                                              --------     --------
          Total liabilities................................................   $481,469     $435,163

Shareholders' Equity:
  Preferred stock, $1.00 par value; authorized 2,000,000 shares;
    none outstanding.......................................................          -            -
  Common stock, $1.00 par value; authorized 6,000,000 shares;
    issued 3,162,500 shares; outstanding 2,563,241 shares at
    March 31, 2000 and 2,839,941 shares at June 30, 1999...................      3,162        3,162
  Additional paid-in capital...............................................     10,141        9,937
  Unearned ESOP compensation...............................................       (315)        (405)
  Unearned restricted stock awards.........................................        (74)         (78)
  Accumulated other comprehensive loss.....................................     (2,090)      (1,089)
  Treasury stock, at cost: 599,259 shares at March 31, 2000
    and 322,559 shares at June 30, 1999....................................     (5,824)      (2,796)
  Retained earnings, substantially restricted..............................     27,906       25,765
                                                                              --------     --------
          Total shareholders' equity.......................................   $ 32,906     $ 34,496
                                                                              --------     --------
          Total liabilities and shareholders' equity.......................   $514,375     $469,659
                                                                              ========     ========

</TABLE>

     See accompanying Notes to Consolidated Financial Statements (unaudited)



                                       1
<PAGE>   4


                       LEDGER CAPITAL CORP. AND SUBSIDIARY
                        CONSOLIDATED STATEMENTS OF INCOME
                (Dollars in thousands, except for per share data)
                                   (Unaudited)


<TABLE>
<CAPTION>

                                                                            Three Months Ended       Nine Months Ended
                                                                                 March 31,              March 31,
                                                                            ------------------     ---------------------
                                                                               2000      1999         2000        1999
                                                                            ----------  ------     ----------   --------
                                                                            (Restated)             (Restated)
<S>                                                                           <C>       <C>        <C>           <C>
INTEREST INCOME:

     Loans receivable..................................................       $7,758    $5,954     $21,049       $17,825
     Securities and interest-bearing deposits..........................        1,410     1,923       4,507         6,102
     Mortgage-backed and related securities............................        1,005       924       3,246         2,119
                                                                            --------    ------    --------      --------
               Total interest income...................................       10,173     8,801      28,802        26,046

INTEREST EXPENSE:

     Deposits..........................................................        4,578     3,970      12,210        11,686
     Advance payments by borrowers for taxes and insurance.............            6         5          57            60
     Notes payable and other borrowings................................        2,305     1,874       6,801         5,650
                                                                            --------    ------    --------      --------
               Total interest expense..................................        6,889     5,849      19,068        17,396
                                                                            --------    ------    --------      --------
     Net interest income...............................................        3,284     2,952       9,734         8,650
     Provision for losses on loans.....................................          337       140         627           480
                                                                            --------    ------    --------      --------
     Net interest income after provision for losses on loans...........        2,947     2,812       9,107         8,170

NON-INTEREST INCOME:

     Service charges on loans..........................................           77       127         235           262
     Service charges on deposit accounts...............................          106       107         347           341
     Loan servicing fees, net..........................................           12         7          36            20
     Insurance commissions.............................................           36        31          86            60
     Gain (loss) on sale of securities and
         mortgage-backed and related securities, net...................          (14)        -          48            35
     Gain (loss) on loans held for sale................................         (188)      180         (35)          832
     Other income......................................................           60       121         166           209
                                                                            --------    ------    --------      --------
               Total non-interest income...............................           89       573         883         1,759

NON-INTEREST EXPENSE:

     Compensation and benefits.........................................        1,206     1,363       3,831         3,885
     Marketing.........................................................           87        96         289           260
     Occupancy and equipment...........................................          347       449       1,164         1,242
     Deposit insurance premiums........................................           17        45         105           127
     Other non-interest expense........................................          425       374       1,089         1,078
                                                                            --------    ------    --------      --------
               Total non-interest expense..............................        2,082     2,327       6,478         6,592
                                                                            --------    ------    --------      --------
     Income before income taxes........................................          954     1,058       3,512         3,337
     Income taxes......................................................          276       340       1,102         1,112
                                                                            --------    ------    --------      --------
          Net income...................................................     $    678    $  718    $  2,410      $  2,225
                                                                            ========    ======    ========      ========
          Earnings per share - (basic) ................................     $   0.27    $ 0.26    $   0.93      $   0.80
                                                                            ========    ======    ========      ========
          Earnings per share - (diluted) ..............................     $   0.26    $ 0.25    $   0.90      $   0.78
                                                                            ========    ======    ========      ========
</TABLE>




     See accompanying Notes to Consolidated Financial Statements (unaudited)



                                       2
<PAGE>   5



                       LEDGER CAPITAL CORP. AND SUBSIDIARY
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                             (Dollars in thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                            Additional    Unearned     Unearned
                                                    Common    Paid-In       ESOP      Restricted
                                                     Stock    Capital   Compensation    Stock
                                                    ------  ----------  ------------  ----------
NINE MONTHS ENDED MARCH 31, 2000
--------------------------------
<S>                                                 <C>       <C>          <C>           <C>
Balance at June 30, 1999........................... $3,162    $9,937       ($405)        ($78)
Net income.........................................      -         -           -            -
Accumulated other comprehensive income:
    Unrealized holding loss arising during period-       -         -           -            -
    Re-classification adjustment for gains
      realized in income...........................      -         -           -            -
    Income tax effect..............................      -         -           -            -

Comprehensive income...............................      -         -           -            -
Cash Dividends ($.05 per share)....................      -         -           -            -
Amortization of unearned ESOP and
  restricted stock award compensation..............      -       204          90            4
Purchase of treasury stock (276,700 shares)........      -         -           -            -
                                                    ------   -------       -----       ------
Balance at March 31, 2000.......................... $3,162   $10,141       ($315)       ($ 74)
                                                    ======   =======       =====       ======

NINE MONTHS ENDED MARCH 31, 1999
--------------------------------
Balance at June 30, 1998........................... $3,162    $9,512       ($532)       ($124)
Net income.........................................      -         -           -            -
Accumulated other comprehensive income:
    Unrealized holding gain arising during period-       -         -           -            -
    Re-classification adjustment for gains
      realized in income..........................       -         -           -            -
    Income tax effect.............................       -         -           -            -

Comprehensive income...............................      -         -           -            -
Amortization of unearned ESOP and
  restricted stock award compensation..............      -       206          81           44
Purchase of treasury stock (70,900 shares).........      -         -           -            -
Exercise of stock options (38,624 shares)..........      -       113           -            -
                                                    ------    ------       -----       ------
Balance at March 31, 1999.......................... $3,162    $9,831       ($451)        ($80)
                                                    ======    ======       =====       ======
</TABLE>


<TABLE>
<CAPTION>
                                                                           Accumulated
                                                                              Other          Total
                                                     Retained   Treasury  Comprehensive  Shareholders'
                                                     Earnings     Stock       loss          Equity
                                                    ----------  --------  -------------  -------------
NINE MONTHS ENDED MARCH 31, 2000                    (Restated)                            (Restated)
--------------------------------
<S>                                                   <C>       <C>         <C>             <C>
Balance at June 30, 1999...........................   $25,765   ($2,796)    ($1,089)        $34,496
Net income.........................................     2,410         -           -           2,410
Accumulated other comprehensive income:
    Unrealized holding loss arising during period-          -    (1,554)     (1,554)
    Re-classification adjustment for gains
      realized in income...........................         -         -         (48)            (48)
    Income tax effect..............................         -         -         601             601
                                                                                            -------
Comprehensive income...............................         -         -           -          (1,409)
Cash Dividends ($.05 per share)....................      (269)        -           -            (269)
Amortization of unearned ESOP and
  restricted stock award compensation..............         -         -           -             298
 Purchase of treasury stock (276,700 shares).......         -    (3,028)            -        (3,028)
                                                      -------   -------    ---------        -------
Balance at March 31, 2000..........................   $27,906   ($5,824)     ($2,090)       $32,906
                                                      =======   =======      =======        =======

NINE MONTHS ENDED MARCH 31, 1999
--------------------------------
Balance at June 30, 1998...........................   $22,847   ($1,385)       ($27)        $33,453
Net income.........................................     2,225         -           -           2,225
Accumulated other comprehensive income:
    Unrealized holding gain arising during period-          -      (104)       (104)
    Re-classification adjustment for gains
      realized in income...........................         -         -         (35)            (35)
    Income tax effect..............................         -         -          14              14
                                                                                            -------
Comprehensive income...............................         -         -           -           2,072
Amortization of unearned ESOP and
  restricted stock award compensation..............         -         -           -             331
Purchase of treasury stock (70,900 shares).........         -      (898)          -            (898)
Exercise of stock options (38,624 shares)..........      (124)      285           -             274
                                                      -------   -------  ----------         -------
Balance at March 31, 1999..........................   $24,948   ($1,998)      ($152)        $35,260
                                                      =======   =======    ========         =======
</TABLE>

     See accompanying Notes to Consolidated Financial Statements (unaudited)


                                       3
<PAGE>   6


                       LEDGER CAPITAL CORP. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                 NINE MONTHS ENDED
                                                                                     MARCH 31,
                                                                             -------------------------
                                                                                2000           1999
                                                                             ----------     ----------
                                                                             (Restated)
                                                                                   (IN THOUSANDS)
<S>                                                                           <C>            <C>
OPERATING ACTIVITIES
Net Income..................................................................  $  2,410       $  2,225
Adjustments to reconcile net income to cash
provided by (used in) operating activities:
  Provision for losses on loans.............................................       627            480
  Provision for depreciation and amortization...............................       562            328
  Net gain on sales of investments and
    mortgage-backed and related securities..................................       (48)           (35)
  Proceeds from the sale of trading securities..............................    24,107              -
  Net gain (loss) on loans held for sale....................................        35           (832)
  Amortization of unearned ESOP and restricted stock awards.................       298            331
  Loans originated for sale.................................................   (15,976)       (49,319)
  Sales of loans originated for sale........................................     8,422         46,376
  Increase in prepaid expenses and other assets.............................    (1,712)        (1,158)
  Decrease in payables for investments purchased...........................     (9,909)        (9,858)
  Increase in accrued expenses and other liabilities........................     2,100            152
  Other adjustments.........................................................       940           (366)
                                                                              --------       --------
Net cash provided by (used in) operating activities.........................    11,856        (11,676)
                                                                              --------       --------

INVESTING ACTIVITIES
Proceeds from the sale of securities available-for-sale.....................    46,602          5,535
Proceeds from the maturity of securities available-for-sale.................     4,160          8,150
Purchases of securities available-for-sale..................................   (34,737)      (103,130)
Proceeds from maturities of securities held-to-maturity.....................         -            572
Purchases of mortgage-backed and related securities.........................    (8,096)       (10,320)
Principal collected on mortgage-backed and related securities...............    27,595         74,895
Net increase in loans receivable............................................   (96,061)        (2,967)
Proceeds from sales of foreclosed properties................................       980             11
Purchase of Federal Home Loan Bank stock....................................    (1,100)          (899)
Purchases of office properties and equipment, net...........................      (130)          (439)
                                                                              --------       --------
Net cash used in investing activities.......................................   (60,787)       (28,592)
                                                                              --------       --------

FINANCING ACTIVITIES
Net increase in deposits....................................................    43,082         36,236
Proceeds from long-term notes payable to Federal Home Loan Bank.............    95,000         25,000
Repayment of long-term notes payable to Federal Home Loan Bank..............   (81,500)       (13,000)
Net increase in short-term notes payable and other borrowings...............    (1,235)             -
Exercise of stock options...................................................         -            274
Purchase of treasury stock..................................................    (3,028)          (898)
Cash dividends..............................................................      (269)             -
Net increase in advance payments by borrowers for
  taxes and insurance.......................................................    (1,232)        (1,513)
                                                                              --------       --------
Net cash provided by financing activities...................................    50,818         46,099
                                                                              --------       --------
Increase in cash and cash equivalents.......................................     1,887          5,831
Cash and cash equivalents at beginning of period............................     8,599          8,184
                                                                              --------       --------
Cash and cash equivalents at end of period..................................  $ 10,486       $ 14,015
                                                                              ========       ========
</TABLE>


     See accompanying Notes to Consolidated Financial Statements (unaudited)


                                       4
<PAGE>   7



                       LEDGER CAPITAL CORP. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                    NINE MONTHS ENDED
                                                                                        MARCH 31,
                                                                                ------------------------
                                                                                   2000          1999
                                                                                ----------    ----------
                                                                                     (IN THOUSANDS)
<S>                                                                               <C>           <C>

Supplemental disclosures of cash flow information:

Interest paid (including amounts credited to deposit accounts) ..............     $17,286       $11,234

Income taxes paid ...........................................................     $   754       $   844


Non-cash transactions:

Loans transferred to foreclosed properties...................................     $ 1,319             -

Securities and mortgage-backed securities reclassified to
  trading and securities available-for-sale..................................     $37,803             -
</TABLE>




     See accompanying Notes to Consolidated Financial Statements (unaudited)



                                       5
<PAGE>   8

                       LEDGER CAPITAL CORP. AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(1)  BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared
in accordance with accounting principles generally accepted in the United States
of America ("GAAP") for interim financial information and in accordance with the
instructions to Form 10-Q/A and Article 10 of Regulation S-X. Accordingly, they
do not include all of the information and footnotes required by GAAP for
complete financial statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) necessary for a fair presentation of
the results for the interim periods have been included.

The results of operations and other data for the three and nine months ended
March 31, 2000 are not necessarily indicative of results that may be expected
for the entire fiscal year ending June 30, 2000.

The unaudited consolidated financial statements include the accounts of Ledger
Capital Corp. (formerly known as Hallmark Capital Corp.) (the "Company") and its
wholly-owned subsidiary, West Allis Savings Bank and subsidiaries (the "Bank")
as of and for the three and nine months ended March 31, 2000. All material
intercompany accounts and transactions have been eliminated in consolidation.

(2)  STOCK BENEFITS AND INCENTIVE PLANS

At March 31, 2000, the Company has reserved 375,642 shares of common stock for a
non-qualified stock option plan for employees and directors. With respect to
options, which have not been granted, the option exercise price cannot be less
than the fair market value of the underlying common stock as of the date of
option grant, and the maximum term cannot exceed ten years. At March 31, 2000
there were 279,480 shares outstanding. No options were exercised, cancelled or
granted during the nine months ended March 31, 2000.

(3)  EARNINGS PER SHARE

Basic earnings per share of common stock for the three and nine months ended
March 31, 2000 and March 31, 1999 have been computed by dividing net income for
the period by the weighted average number of shares of common stock reduced by
ungranted restricted stock and uncommitted ESOP shares. Diluted earnings per
share is calculated by dividing net income by the sum of the weighted average
shares used in the basic earnings per share calculation plus the effect of
dilutive stock options. The effect of dilutive stock options is calculated using
the treasury stock method. The computation of earnings per share is as follows:



                                       6
<PAGE>   9




(3)  EARNINGS PER SHARE (CONT.)
<TABLE>
<CAPTION>

                                                           For the Three Months            For the Three Months
                                                           Ended March 31, 2000            Ended March 31, 1999
                                                        --------------------------      --------------------------
                                                           Basic         Diluted           Basic         Diluted
                                                        -----------    -----------      -----------    -----------

<S>                                                      <C>            <C>              <C>             <C>
Weighted average common shares outstanding...........    2,627,682      2,627,682        2,881,965       2,881,965
Ungranted restricted stock...........................      (18,462)       (18,462)         (18,462)        (18,462)
Uncommitted ESOP shares..............................      (94,875)       (94,875)        (120,175)       (120,175)
Common stock equivalents due to
   dilutive effect of stock options..................            -         69,632                -          87,692
                                                        ----------     ----------       ----------      ----------
Total weighted average common shares
        and equivalents outstanding..................    2,514,345      2,583,977        2,743,328       2,831,020
                                                        ==========     ==========       ==========      ==========
   Net income for period.............................   $  678,000     $  678,000       $  718,000        $718,000
   Earnings per share................................   $     0.27     $     0.26       $     0.26           $0.25
                                                        ==========     ==========       ==========      ==========
</TABLE>

<TABLE>
<CAPTION>

                                                           For the Nine Months              For the Nine Months
                                                           Ended March 31, 2000             Ended March 31, 1999
                                                        -------------------------       --------------------------
                                                          Basic         Diluted            Basic          Diluted
                                                        ----------   ------------       -----------     -----------
<S>                                                      <C>            <C>              <C>             <C>
Weighted average common shares outstanding..........     2,706,019      2,706,019        2,907,363       2,907,363
Ungranted restricted stock..........................       (18,462)       (18,462)         (18,462)        (18,462)
Uncommitted ESOP shares.............................       (94,875)       (94,875)        (120,175)       (120,175)
Common stock equivalents due to
   dilutive effect of stock options.................             -         75,844                -          95,345
                                                        ----------     ----------       ----------      ----------

Total weighted average common shares
   and equivalents outstanding......................     2,592,682      2,668,526        2,768,726       2,864,071
                                                        ==========     ==========       ==========      ==========
   Net income for period............................    $2,410,000     $2,410,000       $2,225,000      $2,225,000
   Earnings per share...............................    $     0.93     $     0.90       $     0.80      $     0.78
                                                        ==========     ==========       ==========      ==========
</TABLE>


(4)  COMMITMENTS AND CONTINGENCIES

Commitments to originate mortgage loans of $6.3 million at March 31, 2000
represent amounts which the Bank expects to fund during the quarter ending June
30, 2000. There were no commitments to sell fixed-rate mortgage loans at March
31, 2000. The Bank had unissued credit under existing home equity line-of-credit
loans and credit card lines of $12.2 million and $6.2 million, respectively, as
of March 31, 2000. Also, the Bank had unused credit under existing commercial
line-of-credit loans of $8.0 million at March 31, 2000. The Bank had no
commitments to purchase fixed-rate mortgage related securities as of March 31,
2000.

(5)  REGULATORY CAPITAL ANALYSIS

The Bank is subject to various regulatory capital requirements administered by
the federal banking agencies. Failure to meet minimum capital requirements can
initiate certain mandatory - and possibly additional discretionary - actions by
regulators that, if undertaken, could have a direct material effect on the
Bank's financial statements. Under capital adequacy guidelines and the
regulatory framework for prompt and corrective action, the Bank must meet
specific capital guidelines that involve quantitative measures of the Bank's
assets, liabilities and certain off-balance sheet items as calculated under
regulatory accounting practices. The Bank's capital amounts and classification
also are subject to qualitative judgments by the regulators about components,
risk weightings and other factors.



                                       7
<PAGE>   10





(5)  REGULATORY CAPITAL ANALYSIS (CONT.)

Quantitative measures established by regulation to ensure capital adequacy
require the Bank to maintain minimum amounts and ratios (set forth in the table
below) of total and Tier I capital (as defined in the regulations) to
risk-weighted assets (as defined), and of Tier I capital (as defined) to average
assets (as defined). As of March 31, 2000, Management believes that the Bank
meets all capital adequacy requirements to which it is subject.

As of March 31, 2000, the Bank is well capitalized as defined by regulatory
standards. To be categorized as well capitalized, the Bank must maintain minimum
total risk-based, Tier I risk-based and Tier I leverage ratios as set forth in
the table below. There are no conditions or events since that notification that
management believes have changed the Bank's category.

The Bank's actual capital amounts and ratios are presented in the tables below.

<TABLE>
<CAPTION>

                                                                                           TO BE WELL CAPITALIZED
                                                                      FOR CAPITAL         UNDER PROMPT CORRECTIVE
                                                    ACTUAL         ADEQUACY PURPOSES          ACTION PROVISIONS
                                               ---------------    -------------------     -----------------------
                                                AMOUNT   RATIO      AMOUNT      RATIO        AMOUNT        RATIO
                                               -------   -----     -------      -----       -------        -----
                                                                   (DOLLARS IN THOUSANDS)
<S>                                            <C>        <C>      <C>          <C>          <C>           <C>
As of March 31, 2000:
  Tier I Capital Leverage (to Average Assets):
    Consolidated........................       $34,236    6.39%    $16,070      3.00%           N/A          N/A
    West Allis Savings Bank.............        32,848    6.14      16,044      3.00         26,741         5.00
  Tier I Capital (to Risk-Weighted Assets):
    Consolidated........................        34,236   10.01      13,687      4.00            N/A          N/A
    West Allis Savings Bank.............        32,848    9.21      14,267      4.00         21,400         6.00
  Total Capital (to Risk-Weighted Assets):
    Consolidated........................        37,445   10.94      27,374      8.00            N/A          N/A
    West Allis Savings Bank.............        36,057   10.11      28,533      8.00         35,667        10.00
</TABLE>


As a state-chartered savings bank, the Bank also is subject to a minimum
regulatory capital requirement of the State of Wisconsin. At March 31, 2000, on
a fully-phased-in basis of 6.0%, the Bank had actual capital of $34,685,000 with
a required amount of $31,116,000, for excess capital of $3,569,000. There is no
requirement to calculate the amount to be well capitalized under prompt
corrective action provisions on a consolidated basis.



                                       8
<PAGE>   11


(6)  LOANS RECEIVABLE

Loans receivable are summarized as follows:

<TABLE>
<CAPTION>

                                                              MARCH 31,                 JUNE 30,
                                                                2000                      1999
                                                         ------------------      -------------------
                                                                       (IN THOUSANDS)
                                                                                                          Increase
                                                         Amount     Percent      Amount      Percent     (Decrease)
                                                         ------     -------      ------      -------     ----------
<S>                                                    <C>            <C>      <C>             <C>        <C>
Real estate mortgage loans:
    Residential one-to-four family...................  $ 182,606      46.0%    $  147,960      49.5%      $ 34,646
    Home equity......................................     20,864       5.3%        20,457       6.8%           407
    Residential multi-family.........................     44,233      11.1%        36,320      12.2%         7,913
    Commercial real estate...........................     70,158      17.7%        42,366      14.2%        27,792
    Residential construction.........................     19,758       5.0%        12,673       4.2%         7,085
    Other construction and land......................     27,274       6.9%        17,056       5.7%        10,218
                                                       ---------    -------    ----------    -------      --------
         Total real estate mortgage loans............    364,893      92.0%       276,832      92.6%        88,061

Consumer-related loans:
    Automobile.......................................        299       0.1%           444       0.2%          (145)
    Credit card......................................      2,243       0.6%         2,372       0.8%          (129)
    Other consumer loans.............................        908       0.2%         1,030       0.3%          (122)
                                                       ---------    -------    ----------    -------      --------
         Total consumer-related loans................      3,450       0.9%         3,846       1.3%          (396)
                                                       ---------    -------    ----------    -------      --------

Commercial loans.....................................     28,170       7.1%        18,254       6.1%         9,916
                                                       ---------    -------    ----------    -------      --------
         Gross loans.................................    396,513     100.0%       298,932     100.0%        97,581

Accrued interest receivable..........................      2,461                    1,664

Less:
    Undisbursed portion of loan proceeds.............    (19,871)                 (16,279)
    Deferred loan fees...............................       (651)                    (490)
    Deferred interest on sale of REO.................        (61)                       -
    Deferred gain on sale of REO.....................        (13)                       -
    Unearned interest................................        (92)                     (59)
    Allowances for loan losses.......................     (3,209)                  (2,648)
                                                       ---------               ----------
                                                       $ 375,077               $  281,120
                                                       =========               ==========
</TABLE>

Loans serviced for investors totaled $44.3 million and $29.2 million at March
31, 2000 and June 30, 1999, respectively.



                                       9
<PAGE>   12


(7)  NOTES PAYABLE AND OTHER BORROWINGS

Notes payable and other borrowings are summarized as follows (dollars in
thousands):

<TABLE>
<CAPTION>

                                        MARCH 31, 2000                             JUNE 30, 1999
                             ------------------------------------             ------------------------
                                                         WEIGHTED                             WEIGHTED
                                                          AVERAGE                              AVERAGE
                             MATURITY      AMOUNT          RATE                AMOUNT           RATE
                             --------     --------       --------             --------        --------


<S>                            <C>        <C>              <C>                <C>               <C>
Advances from
  Federal Home Loan Bank       1999       $      -            -%              $  7,000          6.55%
                               2000         10,002         6.33                 27,002          5.98
                               2001          3,000         5.91                  3,000          5.91
                               2002          5,000         6.43                 28,500          5.61
                               2003          3,042         5.60                  8,042          5.13
                               2004         65,000         5.55                  5,000          6.32
                               2005         35,000         6.03                  5,000          5.33
                               2007          6,500         6.52                  6,500          6.52
                               2008          5,000         4.35                 30,000          4.79
                                          --------                            --------
                                          $132,544         5.78%              $120,044          5.59%
                                                           ====                                 ====

Securities sold under
  Agreements to repurchase     1999       $      -            -%              $  9,475          5.25%
                               2004          9,240         5.69                      -             -
                                          --------                            --------
                                          $  9,240         5.69%              $  9,475          5.25%
                                          --------         ====               --------          ====
                                          $141,784                            $129,519
                                          ========                            ========
</TABLE>



FHLB advances totaled $132.5 million, or 93.5%, and $120.0 million, or 92.7%, of
total borrowings at March 31, 2000 and June 30, 1999, respectively. Certain
advances are callable by the FHLB, advances callable within one year amount to
$85.0 million and $50.5 million at March 31, 2000 and June 30, 1999,
respectively. The Company is required to maintain as collateral unencumbered
one-to-four family mortgage loans in its portfolio such that the outstanding
balance of FHLB advances does not exceed 60% of the book value of this
collateral. The Company had delivered mortgage-backed securities with a carrying
value of $37.1 million and $51.9 million at March 31, 2000 and June 30, 1999,
respectively. In addition, all FHLB advances are collateralized by all Federal
Home Loan Bank stock and are subject to prepayment penalties. The Company's
unused advance line with the Federal Home Loan Bank was $5.3 million based upon
collateral pledged at March 31, 2000. FHLB variable rate term borrowings consist
of $5.0 million tied to the one-month LIBOR index.

The Company enters into sales of mortgage-backed securities with agreements to
repurchase identical securities (reverse repurchase agreements) and
substantially identical securities (dollar reverse repurchase agreements). These
transactions are treated as financings with the obligations to repurchase
securities reflected as a liability. The dollar amount of securities underlying
the agreements remains in the asset accounts. The securities underlying the
agreements are delivered to the counterparty's account. Securities sold under
agreements to repurchase were $9.2 million and $9.5 million at March 31, 2000
and June 30, 1999, respectively.



                                       10
<PAGE>   13




(8)  EMPLOYEE STOCK OWNERSHIP PLAN

The Company has an employee stock ownership plan (ESOP) covering all full-time
employees of the Company who have attained age 21 and completed one year of
service during which they work at least 1,000 hours. The ESOP initially borrowed
$1.0 million from the Company and purchased 253,000 common shares issued in
connection with the Bank's conversion from mutual to stock form in 1993
(Conversion). The debt bears a variable interest rate based on the borrower's
prime lending rate which was 9.0% at March 31, 2000. The balance of this loan
was $404,800 and $506,000 at March 31, 2000 and 1999, respectively. The Bank
makes annual contributions to the ESOP equal to the ESOP's debt service. All
dividends received by the ESOP are paid to the ESOP cash accounts. As the debt
is repaid, shares are released from collateral and allocated to active
employees, based on the proportion of debt service paid in the year. The Company
accounts for its ESOP in accordance with Statement of Position 93-6.
Accordingly, the debt of the ESOP is recorded as debt and the shares pledged as
collateral are reported as unearned ESOP shares in the statement of financial
position. As the shares are released from collateral, the Company reports
compensation expense equal to the current market price of the shares. The excess
of the current market price of shares released over the cost of those shares is
credited to additional paid-in-capital. As shares are released, they become
outstanding for earnings-per-share computations. Dividends on allocated ESOP
shares are recorded as a reduction of shareholders' equity; dividends on
unallocated ESOP shares are recorded as compensation expense. ESOP compensation
expense for the nine months ended March 31, 2000 and 1999 was $306,000 and
$288,000, respectively.

The following is a summary of ESOP shares at March 31, 2000 and 1999:

<TABLE>
<CAPTION>

                                                                Shares
                                                         ----------------------
                                                           2000         1999
                                                         --------    ----------
<S>                                                       <C>           <C>
Allocated shares....................................      138,931       121,792
Unreleased shares...................................       83,309       107,441
                                                         --------    ----------
Total ESOP shares...................................      222,240       229,233
                                                         ========    ==========

Fair value of unreleased shares at March 31,........     $781,000    $1,142,000
                                                         ========    ==========
</TABLE>


(9)  ACCOUNTING FOR DERIVATIVE INVESTMENTS AND HEDGING ACTIVITIES

Effective January 1, 2000, the Company adopted Financial Accounting Standards
Board Statement No. 133 Accounting for Derivative Instruments and Hedging
Activities. As permitted by The Statement, the Company transferred
held-to-maturity mortgage-backed and related securities with a carrying value of
$37,803,000 to trading securities ($24,320,000) and to securities
available-for-sale ($13,483,000). At the time of transfer there was an
unrealized gain on the trading securities of $16,000 and an unrealized gain on
the securities available-for-sale of $60,000. The unrealized gains are included
in the loss on sale of securities and mortgage-backed and related securities in
the Consolidated Statements of Income for the trading securities and in Other
Comprehensive Income-Unrealized Holding Loss in the quarter ended March 31, 2000
and are not presented as a cumulative effect of an accounting change due to
their immateriality to net income and comprehensive net income for the period.

During the quarter ended March 31, 2000, the Company entered into interest rate
caps with a notional amount of $75.0 million with maturity dates ranging from
June 14, 2001 to January 3, 2002. The interest rate caps are carried at fair
market value of $269,000 in the Consolidated Statement of Financial Condition at
March 31, 2000. The difference between the cost of the caps of $340,000 and the
fair market value is included in expense for the quarter. At March 31, 2000, the
Company designated these caps as a cash flow hedge of the interest rate risk on
short-term wholesale certificates of deposit which renew every 90 days and are
indexed to the 3-month LIBOR. The caps are tied to the 3-month LIBOR interest
rate with a 7% strike rate. Cash payments will be received by the Company if the
3-month LIBOR exceeds 7%.



                                       11
<PAGE>   14



(9)  ACCOUNTING FOR DERIVATIVE INVESTMENTS AND HEDGING ACTIVITIES (CONT.)

The Company formally documents all relationships between hedging instruments and
hedged items as well as its risk-management objective and strategy for
undertaking the hedge transaction. This process includes linking derivatives
that are designated as fair value or cash flow hedges to specific recorded
assets or liabilities or to firm commitments on forecasted transactions.

The Company formally assesses at inception and on an ongoing basis, whether
derivatives that are used in hedging transactions have been highly effective in
offsetting fair values or cash flows of hedged items and whether they are
expected to continue to be highly effective in the future.

If at any time the Company determined that the hedge was no longer highly
effective, or if the hedged forecasted transactions were not executed, hedge
accounting would be discontinued and the derivative instrument would continue to
be marked to its fair value with gains or losses recognized in non-interest
income. The change in fair value of derivative instruments designated as cash
flow hedges will be recognized in other comprehensive income in future periods
and the changes in the fair value of derivative instruments designated as fair
value hedges will be recognized in non-interest income or expense.

At March 31, 2000, the interest rate caps are the only derivative instruments
used by the Company to manage interest rate risk. The Company's derivative
activities are monitored by its Asset Liability Committee as part of that
Committee's oversight of risk management and asset/liability functions.

(10) RESTATEMENT OF FINANCIAL STATEMENTS

In April, 2001 the Company discovered a mathematical error in the way in which
interest income was being accrued on certain purchased commercial real estate
mortgage and multi-family residential mortgage loans. The error resulted from an
inadvertent erroneous set-up of the loans in the Company's outsourced data
processing system. The error resulted in the under accrual of interest income on
these loans of $158,252 and $341,810 for the three and nine months ended March
31, 2000, respectively. Interest income has been restated to correct that error.
As a result of increased earnings in 2000 from the correction of this error,
additional compensation of $36,500 and $109,500 for the three and nine months
ended March 31, 2000, respectively, is required to be accrued under the
Company's Annual Incentive Plan. The Company's 2000 consolidated financial
statements have, therefore, been restated to accrue the additional interest
income and the additional compensation expense as well as income tax expense of
$47,849 and $91,298 related to the $121,752 and $232,310 net effect of the
corrections on income before taxes for the three and nine months ended March 31,
2000, respectively. The effect of the restatement increased net income by
$73,903 and $141,012 and both basic and diluted earnings per share by $.03 and
$.05 for the three and nine months ended March 31, 2000, respectively.



                                       12
<PAGE>   15




                       LEDGER CAPITAL CORP. AND SUBSIDIARY

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


FORWARD-LOOKING STATEMENTS

When used in this Quarterly Report on Form 10-Q/A or future filings with the
Securities and Exchange Commission, in annual reports or press releases or other
public or shareholder communications, or in oral statements made with the
approval of an authorized executive officer, various words or phrases are
intended to identify "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements include words and phrases such as: "will likely result," "are
expected to," "will continue," "is anticipated," "estimate," "project," "intends
to" or similar expressions and various other statements indicated herein with an
asterisk after such statements. The Company wishes to caution readers not to
place undue reliance on any such forward-looking statements, which speak only as
of the date made, and to advise readers that various factors could affect the
Company's financial performance and could cause actual results for future
periods to differ materially from those anticipated or projected. Such factors
include, but are not limited to: (i) general market rates, (ii) general economic
conditions, (iii) legislative/regulatory changes, (iv) monetary and fiscal
policies of the U.S. Treasury and Federal Reserve, (v) changes in the quality or
composition of the Company's loan and investment portfolios, (vi) demand for
loan products, (vii) deposit flows, (viii) competition, (ix) demand for
financial services in the Company's markets, and (x) changes in accounting
principles, policies or guidelines.

The Company does not undertake and specifically disclaims any obligation to
update any forward-looking statements to reflect the occurrence of anticipated
or unanticipated events or circumstances after the date of such statements.

In April, 2001 the Company discovered a mathematical error in the way in which
interest income was being accrued on certain purchased commercial real estate
mortgage and multi-family residential mortgage loans. The error resulted from an
inadvertent erroneous set-up of the loans in the Company's outsourced data
processing system. The error resulted in the under accrual of interest income on
these loans of $158,252 and $341,810 for the three and nine months ended March
31, 2000, respectively. Interest income has been restated to correct that error.
As a result of increased earnings in 2000 from the correction of this error,
additional compensation of $36,500 and $109,500 for the three and nine months
ended March 31, 2000, respectively, is required to be accrued under the
Company's Annual Incentive Plan. The Company's 2000 consolidated financial
statements have, therefore, been restated to accrue the additional interest
income and the additional compensation expense as well as income tax expense of
$47,849 and $91,298 related to the $121,752 and $232,310 net effect of the
corrections on income before taxes for the three and nine months ended March 31,
2000, respectively. The effect of the restatement increased net income by
$73,903 and $141,012 and both basic and diluted earnings per share by $.03 and
$.05 for the three and nine months ended March 31, 2000, respectively.

GENERAL

The Company's primary strategy since the Conversion has been to focus on
effectively utilizing the capital acquired in the Conversion through asset
growth and asset portfolio diversification into higher-yielding assets. This
strategy resulted in an increase in the Company's asset size from $179.6 million
at June 30, 1994 to $514.4 million at March 31, 2000. The Company's asset growth
has come primarily through (i) the origination and purchase of mortgage loans
(principally loans secured by one-to-four family owner-occupied homes) within
and outside of the Company's primary lending area, (ii) the purchase of
mortgage-backed and related securities, and (iii) the origination and purchase
of commercial real-estate and business loans within and outside of the Company's
primary lending area. This asset growth was funded



                                       13
<PAGE>   16


through significant increases in Federal Home Loan Bank ("FHLB") advances and
other borrowings, and increases in deposits consisting primarily of brokered and
non-brokered wholesale deposits.

The Company's asset portfolio diversification has been, and continues to be,
achieved by altering the composition of loans and securities originated,
purchased, sold and held in the total asset portfolio. In particular, the
Company has primarily focused on originating and purchasing higher-yielding
multi-family, commercial real estate and commercial business loans secured by
properties or assets located within the Company's primary lending area (as
defined herein), to either replace or supplement lower-yielding one-to-four
family mortgage loans and principal run-off from the mortgage securities
portfolio.* As part of its asset portfolio diversification strategy, the Company
established a new commercial lending division in fiscal 1997 to originate
commercial/industrial real estate term loans, construction loans, equipment
leasing, inventory/equipment/receivables financing, lines of credit, letters of
credit and government loan programs both within and outside of the Company's
primary lending area. In fiscal 2000, the Company intends to continue its asset
portfolio diversification strategy while maintaining a steady rate of growth of
its asset base. The Company does not expect significant asset growth during the
last quarter of fiscal year 2000.*

In fiscal 2000, the Company's business strategy is to continue its focus on
increasing net interest income and generating additional non-interest income
from existing and new revenue sources.* In order to increase net interest
income, the Company intends to continue to utilize its asset portfolio
diversification strategy of selling lower-yielding assets such as securities and
one-to-four family mortgage loans that conform to Federal Home Loan Mortgage
Corporation ("FHLMC") and Federal National Mortgage Association ("Fannie Mae")
guidelines in the secondary market to provide liquidity to fund higher-yielding
one-to-four family non-conforming mortgage, multi-family, commercial real estate
and commercial business loan originations and purchases, increase non-interest
income and maintain adequate levels of capital.* The Company anticipates that
increased sales of one-to-four family conforming mortgage loans will decrease
the proportion of the gross loan portfolio represented by such loans and will
increase non-interest income as a result of increased gains on the sales of such
loans.*

Portfolio diversification in fiscal 2000 also will include an increased level of
purchases of loans or participation interests in loans originated by other
lenders both within and outside the Company's primary lending area.* Loans
purchased, or participation interests purchased, which relate to properties or
business assets located outside of the Company's primary lending area will
primarily consist of higher-yielding non-conforming one-to-four family,
multi-family, commercial real estate, multi-family construction, commercial real
estate construction and commercial business loans.* Loan purchases of $85.6
million contributed to the asset growth during the nine months ended March 31,
2000. The loans purchased were higher yielding, non-conforming one-to-four
family, multi-family, land, commercial real estate and commercial loans. Of the
$85.6 million in non-conforming higher yielding loans purchased for the
Company's portfolio during the nine month period ended March 31, 2000, $33.4
million were one-to-four family loans and $34.8 million were commercial real
estate loans, none of which conformed to FHMLC and Fannie Mae secondary market
guidelines. Such loans are secured by properties located primarily in the
midwest region of the country, outside of the Company's primary lending area.

In fiscal 2000, the Company projects total loan and participation interest
purchases which relate to residential and commercial properties or business
assets to be approximately $100 million compared to $56.9 million in fiscal
1999.* The Company anticipates that approximately $50 million of such amount
will relate to one-to-four family non-conforming mortgage loans secured by
properties located outside of the Company's primary lending area and the balance
(approximately $40 million) will relate to the purchase of multi-family,
multi-family construction, commercial real estate, commercial construction and
commercial business loans secured by properties and assets located both inside
and outside its primary lending area.* In deciding whether or not to purchase a
loan or participation interest in a loan secured by properties or business
assets located outside of the Company's primary lending area, management of the
Company



                                       14
<PAGE>   17


has applied, and will continue to apply, underwriting guidelines at least as
strict as those applicable to the origination of similar loans within its
primary lending area.*

In fiscal 2000, the Company will evaluate opportunities to purchase one-to-four
family mortgage loans which conform to FHMLC and Fannie Mae underwriting
guidelines and non-conforming portfolio loans which are not sold in the
secondary agency market due to underwriting characteristics that do not conform
to the secondary agency market.* Purchases of conforming and non-conforming
one-to-four family mortgage loans will include lending opportunities on a
national basis. One-to-four family non-conforming loans also will be originated
by the Company within its primary lending area. For the nine months ended March
31, 2000, the Company purchased $33.4 million of non-conforming one-to-four
family mortgage loans.

In fiscal 2000, the Company also intends to continue increasing the activities
of its commercial lending division as another element of its overall portfolio
diversification strategy.* The focus of the Company's commercial lending
operation will be the origination and purchase of small business loans and
leases.* During fiscal 1999, the Company originated and purchased $137.7 million
of multi-family, commercial real estate, multi-family construction, commercial
construction and commercial business loans, lines of credit and leases. For the
nine months ended March 31, 2000, the Company originated and purchased $115.9
million of multi-family, commercial real estate, multi-family construction,
land, commercial construction and commercial business loans, lines of credit and
leases. Management currently projects that the commercial lending division will
increase its level of originations and purchases to approximately $120 million
in new commercial loans, lines of credit and leases during fiscal 2000.*
Management believes the commercial lending component of its operations will
benefit the Company longer term and contribute to a long-term increase in net
income and return on equity.* The commercial lending division also has enhanced
the Company's core deposit base, through the establishment of new deposit
relationships with the commercial lending division's customers.

The Company established a new mortgage banking subsidiary, Ledger Financial,
Inc. (d/b/a Major Finance) at the end of fiscal 1999 to provide lending
activities involving higher credit risk financial services (also known as
subprime lending). For the nine months ended March 31, 2000, Major Finance acted
as a broker of non-conforming subprime residential and commercial mortgage
loans. As a broker, Major Finance would interview prospective borrowers,
complete a loan application, collect and verify financial data on the borrower
and submit the loan file to a potential lender or investor. The lender or
investor would then make the final underwriting decision and close the loan in
their own name. Major Finance would receive a fee directly from the lender or
investor for its brokering services. No loans were funded or originated by the
Bank and retained in its portfolio. For the nine months ended March 31, 2000,
the majority of Major Finance's subprime lending activity related to residential
mortgage loans. Based on the performance of Major Finance and current market
factors, the Company has decided to discontinue originating and brokering loans
through the Major Finance subsidiary.

During fiscal 2000, the Company intends to increase its non-interest income by
expanding the residential lending and commercial banking fee income producing
divisions.* The Company expects one-to-four family mortgage loan originations to
remain strong despite the generally higher level of market interest rates.* It
is currently anticipated that substantially all of the 30-year fixed rate
conforming one-to-four family mortgage loans originated in fiscal 2000 will be
sold in the secondary market resulting in income from gains on loans sold.*
During the nine months ended March 31, 2000, the Company originated and sold
$8.1 million in such loans, resulting in $181,000 income from gains on loans
sold. The Company also expects increased fee income from the commercial banking
division resulting from a growth in business deposit relationships and loan
originations.* The Company expects its insurance subsidiary, Ledger Planning
Services, Inc., to continue to generate fee income from investment product and
annuity sales.* The Company also has recently implemented a program for mortgage
contract cash processing within the commercial lending division, a service
intended to generate fee income.* The Bank acts as a partial sub-servicer,
providing a cash/processing function for nationally-originated commercial real
estate loans.



                                       15
<PAGE>   18



The Company also intends to expand its community "relationship banking" focus by
targeting cross sales opportunities to individuals and businesses through
customer segmentation and database marketing, planning the opening of a new
retail location at the Company's headquarters in Glendale, Wisconsin, and
expanding the delivery of products and services through the Internet.*

LIQUIDITY AND CAPITAL RESOURCES

The Company's primary sources of funds are retail and wholesale brokered
deposits, proceeds from principal and interest payments on loans, principal and
interest payments on mortgage-backed and related securities, FHLB-Chicago
advances and reverse repurchase agreements. Alternative funding sources are
evaluated and utilized based upon factors such as interest rates, availability,
maturity, administrative costs and retention capability. Although maturity and
scheduled amortization of loans are predictable sources of funds, deposit flows,
mortgage prepayments and prepayments on mortgage-backed and related securities
are influenced significantly by general interest rates, economic conditions and
competition. Mortgage loans and mortgage securities prepayments increased in
fiscal 1999 overall as interest rates declined significantly during the first
half of the fiscal year before increasing in the last half of the fiscal year.
During fiscal years 1997 and 1998, prepayments increased as interest rates
decreased in the second half of both fiscal years. As a result of the upward
trend in interest rates extended through the nine month period ending March 31,
2000, the mortgage loan and mortgage securities prepayments and gain on sales of
loans has decreased compared to the nine month period ended March 31, 1999.

The primary investing activity of the Company is the origination and purchase of
loans and the purchase of mortgage-backed and related securities. For the nine
months ended March 31, 2000, the Company originated and purchased loans totaling
$110.2 million and $85.6 million, respectively, as compared to the nine months
ended March 31, 1999 when originated and purchased loans totaled $161.2 million
and $29.9 million, respectively. Purchases of mortgage-backed and related
securities held-to-maturity for the nine months ended March 31, 2000 and 1999
totaled $8.1 million and $10.3 million, respectively. There were no purchases of
investment securities held-to-maturity for the nine months ended March 31, 2000
and 1999. For the nine months ended March 31, 2000 and 1999, these activities
were funded primarily by principal repayments on loans of $90.1 million and
$145.1 million, respectively; principal repayments on mortgage-backed and
related securities of $27.6 million and $74.9 million, respectively; proceeds
from the sale of mortgage loans of $8.4 million and $46.4 million, respectively;
net proceeds from notes payable to the FHLB-Chicago of $12.5 million and $12.0
million, respectively; and a net increase in deposits of $43.1 million during
the 2000 period. Purchases of securities available-for-sale totaled $34.7
million and sales were $46.6 for the nine months ended March 31, 2000, compared
to purchases of $103.1 million and sales of $5.5 million for the nine months
ended March 31, 1999. Sales of trading securities totaled $24.1 million for the
nine months ended March 31, 2000. There were no sales of trading securities for
the nine months ended March 31, 1999.

The Company is required to maintain minimum levels of liquid assets under the
regulations of the Wisconsin Department of Financial Institutions, Division of
Savings and Loan for state-chartered stock savings banks. Savings banks are
required to maintain an average daily balance of liquid assets (including cash,
certain time deposits, certain bankers acceptances, certain corporate debt
securities, securities of certain mutual funds and specified United States
government, state or federal agency obligations) of not less than 8.0%. The
Company's liquidity ratio was 11.4% at March 31, 2000. The Company adjusts its
liquidity levels to meet various funding needs and to meet its asset and
liability management objectives.

The Company's most liquid assets are cash and cash equivalents, which include
investments in highly-liquid, short-term investments. The levels of these assets
are dependent on the Company's operating, financing, lending and investing
activities during any given period. At March 31, 2000 and June 30, 1999, cash
and cash equivalents were $10.5 million and $8.6 million, respectively. The
increase in cash and cash equivalents was due to an increase in deposits,
FHLB-Chicago advances, securities sold under agreements to repurchase and the
sales of mortgage backed and related securities.



                                       16
<PAGE>   19



Management believes that the strategy of leveraging the capital acquired in the
Conversion to achieve the targeted asset size established by the Board of
Directors within a three-to-five year period following the Conversion could not
have been achieved solely through the use of retail deposits from the local
market. Management also believes that the costs, overhead and interest expense
of achieving comparable retail deposit growth would have exceeded the costs
related to the use of FHLB-Chicago advances and wholesale brokered deposits as a
funding source. However, management recognizes that the likelihood for retention
of brokered certificates of deposit is more a function of the rate paid on such
accounts as compared to retail deposits which may be established due to Bank
location or other intangible reasons. The Company maintains a $10.0 million
backup credit facility for contingency purposes to replace funds from wholesale
brokered deposits should retention of those deposits diminish due to
extraordinary events in the financial markets. The Company's overall cost of
funds has increased in recent years due primarily to a much greater percentage
of the deposits being in certificates, both wholesale brokered and retail, as
opposed to passbooks, money market accounts and checking accounts. Management
believes that a significant portion of its retail deposits will remain with the
Company and, in the case of wholesale brokered deposits, may be replaced with
similar type accounts should the level of interest rates change.* However, in
the event of a significant increase in market interest rates, the cost of
obtaining replacement brokered deposits would increase as well.

At March 31, 2000, retail and wholesale certificates of deposit totaled $57.8
million and $215.8 million, respectively. Management believes that a significant
portion of its retail deposits will remain with the Company and, in the case of
wholesale brokered deposits, may be replaced with similar type accounts should
the level of interest rates change.* However, in the event of a significant
increase in market interest rates, the cost of obtaining replacement wholesale
deposits and FHLB advances would increase as well.

The Bank's Board of Directors has set a maximum limitation of total borrowings
equal to 32% of total assets. The internal limitation is 3% below the allowable
borrowing limit (for all borrowings including FHLB advances and reverse
repurchase agreements) of 35% of total assets established by the FHLB-Chicago.
At March 31, 2000, FHLB advances totaled $132.5 million or 25.7% of the Bank's
total assets. At March 31, 2000, securities sold under agreements to repurchase
were $9.2 million or 1.8% of the Bank's total assets. At March 31, 2000, the
Bank had unused borrowing authority under the borrowing limitations established
by the Board of Directors of $23.0 million and $38.5 million under the FHLB
total asset limitation. The Bank has and intends to continue to fund asset
portfolio diversification in fiscal 2000 through modest increases in FHLB
advances and reverse repurchase agreements.

Liquidity management for the Company is both an ongoing and long-term function
of the Company's asset/liability management strategy. Excess funds generally are
invested in short-term investments such as federal funds or overnight deposits
at the FHLB-Chicago. Whenever the Company requires funds beyond its ability to
generate them internally, additional sources of funds usually are available and
obtainable from the wholesale brokered and non-brokered market as well as the
unused credit line from the FHLB-Chicago, and funds also may be available
through reverse repurchase agreements wherein the Company pledges investment,
mortgage-backed or related securities. The Company maintains a $10.0 million
contingent backup credit facility with a major correspondent bank to replace a
portion of its interest rate sensitive liabilities, such as borrowings and
wholesale brokered and non-brokered deposits should such funding sources become
difficult or impracticable to obtain or retain due to a changing interest rate
environment. The Company also has a federal funds open line of credit in the
amount of $10.0 million with a correspondent bank which does not require the
direct pledging of any assets. In addition, the Company maintains a relatively
high level of liquid assets such as investment securities and mortgage-backed
and related securities available-for-sale in order to ensure sufficient sources
of funds are available to meet the Company's liquidity needs.

The Company has various unfunded commitments at March 31, 2000 which represent
amounts the Company expects to fund during the quarter ended June 30, 2000. For
a summary of such commitment see discussion under footnote (4) "Commitments and
Contingencies" contained in the section entitled, "Notes to Consolidated
Financial Statements." The Company anticipates it will have sufficient funds
available to meet



                                       17
<PAGE>   20


its current loan commitments, including loan applications received and in
process to the issuance of firm commitments.

CHANGE IN FINANCIAL CONDITION

Total assets increased $44.4 million, or 9.5%, from $469.7 million at June 30,
1999 to $514.4 million at March 31, 2000. This increase is primarily reflected
in an increase in loans receivable and loans held for sale, funded primarily by
an increase in deposits, FHLB-Chicago advances, securities sold under agreements
to repurchase and decreases in securities available-for-sale. Cash and cash
equivalents were $10.5 million and $8.6 million at March 31, 2000 and June 30,
1999, respectively. The increase in cash and cash equivalents was due to an
increase in deposits, FHLB-Chicago advances, securities sold under agreements to
repurchase and the sales of mortgage backed and related securities.

Loans receivable increased to $375.1 million at March 31, 2000 compared to
$281.1 million at June 30, 1999. The increase at March 31, 2000 compared to June
30, 1999 is primarily the result of the purchase of non-conforming one-to-four
family, multi-family and commercial real estate loans secured by properties
located out of the Company's primary lending area, as such loans carried higher
yields than comparable mortgage-backed and related securities during the nine
months ended March 31, 2000.

Total mortgage loans originated and purchased amounted to $159.9 million ($76.0
million of which were purchased mortgage loans) and $148.5 million ($3.5 million
of which were purchased mortgage loans) for the nine months ended March 31, 2000
and 1999, respectively. The Company originated $42.2 million of conforming
one-to-four family mortgage and construction loans within the primary lending
area and purchased $33.4 million of non-conforming one-to-four family mortgage
loans outside of the primary lending area. The Company originated $12.8 million
of non-conforming multi-family loans within the primary lending area and
purchased $7.3 million of non-conforming multi-family loans outside of the
primary lending area for the period ending March 31, 2000. Total commercial real
estate mortgage loans originated and purchased totaled $59.3 million and $33.2
million for the nine months ended March 31, 2000 and 1999, respectively. Of the
$59.3 million commercial real estate mortgage loans originated and purchased,
$24.5 million were originations of non-conforming commercial real estate loans
within the Company's primary lending area, while $33.3 million were purchases of
non-conforming commercial real estate loans outside the Company's primary
lending area and $1.5 million were purchased non-conforming commercial real
estate loans within the Company's primary lending area. The Company originated
$22.0 million of non-conforming commercial loans within the primary lending area
and purchased $9.6 million of non-conforming commercial loans outside of the
primary lending area. At March 31, 2000, the multifamily and commercial
components of the Company's loan portfolio totaled $169.8 million, or 42.8% of
the total loan portfolio, compared to $119.7 million, or 39.8% of the total loan
portfolio at March 31, 1999.

Sales of fixed-rate mortgage loans totaled $7.5 million and $49.3 million for
the nine months ended March 31, 2000 and 1999, respectively. The decrease in the
sales of fixed-rate mortgage loans is due to management's intent to hold a
greater number of these loans in the portfolio and the lower volume of
originations in the nine months ended March 31, 2000 compared to March 31, 1999.

Securities available-for-sale decreased to $78.1 million at March 31, 2000
compared to $100.5 million at June 30, 1999. Mortgage-backed and related
securities held-to-maturity decreased to $15.6 million at March 31, 2000
compared to $54.6 million at June 30, 1999. The decrease in securities
available-for-sale was the result of management's decision to sell securities to
fund loan purchases and originations which carry higher yields than securities.
As a result of the adoption of Statement of Financial Accounting Standards No.
133, Accounting for Derivative Instruments and Hedging Activities ("Statement
133"), the Company transferred securities within the investment portfolio. The
Company transferred securities totaling $37,803,000 from the held-to-maturity to
the trading and available-for-sale classifications. All securities transferred
to trading were sold during the quarter ended March 31, 2000 at a loss of
$36,000.



                                       18
<PAGE>   21



Deposits increased $43.1 million to $331.8 million at March 31, 2000 from $288.7
million at June 30, 1999. The increase in deposits was primarily due to the
Company's increase in wholesale brokered deposits. Brokered certificates of
deposit totaled $199.3 million at March 31, 2000, representing 60.1% of total
deposits as compared to $101.2 million, or 35.0% of total deposits, at June 30,
1999. Non-brokered wholesale deposits totaled $16.5 million at March 31, 2000,
representing 5.0% of total deposits as compared to $55.2 million, or 19.1% of
total deposits at June 30, 1999. Deposits are the Company's primary source of
externally generated funds. The level of deposits is heavily influenced by such
factors as the general level of short- and long-term interest rates as well as
alternative yields that investors may obtain on competing investment securities
such as money market mutual funds.

FHLB-Chicago advances increased to $132.5 million at March 31, 2000 compared to
$120.0 million at June 30, 1999. At March 31, 2000, securities sold under
agreements to repurchase were $9.2 million compared to $9.5 million at June 30,
1999. The Company has increased its use of FHLB-Chicago advances and securities
sold under agreements to repurchase as a funding source due to attractive rates
offered in relation to deposit funds obtainable in the Company's local market.

ASSET/LIABILITY MANAGEMENT

The Company closely monitors interest rate risk in an attempt to manage the
extent to which net interest income is significantly affected by changes in
market interest rates. In managing the Company's interest rate risk during the
nine months ended March 31, 2000, the Company utilized wholesale brokered and
non-brokered deposits and FHLB-advances to fund increases in the Company's
interest-bearing assets due primarily to the attractive rates offered on
wholesale deposits and FHLB advances. At March 31, 2000, the Company's estimated
cumulative one-year gap between assets and liabilities was a negative 41.0% of
total assets as compared to a negative 25.6% at June 30, 1999.

The increase in the Company's negative one-year gap reflects the increased use
of shorter-term maturity deposits and FHLB advances to fund a larger portfolio
of fixed-rate mortgage loans. Beginning in January 2000 and in conjunction with
the increased negative gap position of the Company, management with the approval
of the Board of Directors has started to manage the interest rate risk on the
Company's short-term wholesale certificates of deposit using interest rate caps
to limit the Company's exposure to rising interest rates. See Footnote (9)
"Accounting for Derivative Investments and Hedging Activities" for discussion of
the caps. At March 31, 2000, the notional amount of the interest rate caps was
$75 million with maturity dates of June 14, 2001 and January 3, 2002. The
interest rate caps are tied to the 3-month LIBOR interest rate with a 7.0%
strike rate. Payments will be received by the Bank if the 3-month LIBOR
increases over the 7.0% strike rate. The unamortized cost of the interest rate
caps at March 31, 2000 is $269,000 with a fair value of $269,000 which is
recorded as an other asset in the Consolidated Statement of Financial Condition.
The time value of the caps of $51,000 and the change in fair value of $20,000
are recognized in Interest Expense in the Consolidated Statements of Income in
the three months ended March 31, 2000. There are certain risks associated with
interest rate caps, including the risk that the counterparty may default and
that there may not be an exact correlation between the indices on which the
interest rate cap agreements are based and the terms of the hedged liabilities.
In order to offset these risks, the Company generally enters into interest rate
cap agreements only with nationally recognized securities firms and monitors the
credit status of counterparties, the level of collateral for such caps and the
correlation between the hedged liabilities and the indices utilized.

During periods of rising interest rates, a negative interest rate sensitivity
gap would tend to negatively affect net interest income, while a positive
interest rate sensitivity gap would positively affect net income.
Notwithstanding, the potential positive effect of the Company's one-year gap
position during periods of falling



                                       19
<PAGE>   22


interest rates, the Company could experience substantial prepayments of its
fixed rate mortgage loans and mortgage-backed and related securities, which
would result in the reinvestment of such proceeds at market rates which would be
lower than the then current rates.*



                                       20
<PAGE>   23


ASSET/LIABILITY MANAGEMENT SCHEDULE

The following table sets forth at March 31, 2000 the amounts of interest-earning
assets and interest-bearing liabilities maturing or repricing within the time
periods indicated, based on the information and assumptions set forth in the
notes thereto.

<TABLE>
<CAPTION>

                                                                         AMOUNT MATURING OR REPRICING
                                                     --------------------------------------------------------------------
                                                                             MORE THAN   MORE THAN
                                                       WITHIN     FOUR TO     ONE YEAR  THREE YEARS
                                                       THREE      TWELVE      TO THREE    TO FIVE     OVER FIVE
                                                       MONTHS     MONTHS       YEARS       YEARS        YEARS     TOTAL
                                                     ---------   ---------   ---------  -----------   --------   --------
                                                                            (DOLLARS IN THOUSANDS)
<S>                                                   <C>        <C>         <C>         <C>          <C>        <C>

INTEREST-EARNING ASSETS(1):
Mortgage loans(2):
     Fixed rate....................................   $ 16,426   $  30,597   $  68,301   $ 69,738     $ 61,309   $246,371
     Adjustable rate...............................     28,511      41,888      31,609      6,376        1,245    109,629
Consumer loans (2).................................        123       2,441         506        160            -      3,230
Commercial loans (2)...............................      9,827       6,029       6,669      4,802            -     27,327
Mortgage-backed and related securities:
     Fixed rate and securities available-for-sale..      1,575       4,299       8,922      6,265       10,165     31,226
     Adjustable rate...............................     13,816      10,413           -          -            -     24,229
Investment securities and
  securities available-for-sale ...................     15,613         728           -      9,597       27,696     53,634
                                                     ---------   ---------   ---------   --------     --------   --------
     Total interest-earning assets.................   $ 85,891   $  96,395   $ 116,007   $ 96,938     $100,415   $495,646
                                                     =========   =========   =========   ========     ========   ========

INTEREST-BEARING LIABILITIES:
Deposits(3):
     NOW accounts..................................   $    231   $     692   $   1,097   $    538     $    516   $  3,074
     Money market deposit accounts.................      4,163      12,488       9,325      1,492          284     27,752
     Passbook savings accounts.....................      1,480       4,440       7,045      3,452        3,316     19,733
     Certificates of deposit.......................    171,058     486,570      13,482      1,993            -    273,629
     Escrow deposits...............................          -       1,993           -          -            -      1,993
Borrowings(4)
     FHLB advances and other borrowings............     34,242      75,000      13,042      8,000       11,500    141,784
                                                     ---------   ---------   ---------   --------     --------   --------
     Total interest-bearing liabilities............  $ 211,700   $ 181,183   $  43,991   $ 15,475     $ 15,616   $467,965
                                                     =========   =========   =========   ========     ========   ========
Excess (deficiency) of interest-earning assets over
  interest-bearing liabilities.....................  ($125,809)   ($84,788)  $  72,016   $ 81,463     $ 84,799   $ 27,681
                                                     =========   =========   =========   ========     ========   ========
Cumulative excess (deficiency) of interest-earning
  assets over interest-bearing liabilities.........  ($125,809)  ($210,597)  ($138,581)  ($57,118)    $ 27,681   $ 27,681
                                                     =========   =========   =========   ========     ========   ========
Cumulative excess (deficiency) of interest-earning
  assets over interest-bearing liabilities
  as a percent of total assets.....................      (24.5)%     (41.0)%     (27.0)%    (11.1)%        5.4%       5.4%
                                                     =========   =========   =========   ========     ========   ========
</TABLE>



(1)  Adjustable- and floating-rate assets are included in the period in which
     interest rates are next scheduled to adjust rather than in the period in
     which they are due, and fixed-rate assets are included in the periods in
     which they are scheduled to be repaid based on scheduled amortization, in
     each case adjusted to take into account estimated prepayments utilizing the
     Company's historical prepayment statistics modified for forecasted
     statistics using annual prepayment rates ranging from 5% to 20%, based on
     the loan type.

(2)  Balances have been reduced for undisbursed loan proceeds, unearned credit
     insurance premiums, deferred loan fees, purchased loan discounts and the
     allowance for loan losses, which aggregated $23.7 million at March 31,
     2000.

(3)  Although the Company's negotiable order of withdrawal ("NOW") accounts,
     passbook savings accounts and money market deposit accounts generally are
     subject to immediate withdrawal, management considers a certain historical
     amount of such accounts to be core deposits having significantly longer
     effective maturities and times to repricing based on the Company's
     historical retention of such deposits in changing interest rate
     environments. NOW accounts, passbook savings accounts and money market
     deposit accounts are assumed to be withdrawn at annual rates of 30%, 30%
     and 60%, respectively, of the declining balance of such accounts during the
     period shown. The withdrawal rates used are higher than the Company's
     historical rates but are considered by management to be more indicative of
     expected withdrawal rates currently. If all of the Company's NOW accounts,
     passbook savings accounts and money market deposit accounts had been
     assumed to be subject to repricing within one year, the one-year cumulative
     deficiency of interest-earning assets over interest-bearing liabilities
     would have been $237.7 million or 46.2% of total assets.

(4)  Adjustable- and floating-rate borrowings are included in the period in
     which their interest rates are next scheduled to adjust rather than in the
     period in which they are due.



                                       21
<PAGE>   24


ASSET QUALITY

The Company and the Bank regularly review assets to determine proper valuation.
The review consists of an update of the historical loss experience, valuation of
the underlying collateral and the outlook for the economy in general as well as
the regulatory environment.

The following table sets forth information regarding the Bank's non-accrual
loans and foreclosed properties at the dates indicated:


<TABLE>
<CAPTION>

                                                                                THREE MONTHS ENDED
                                                              -----------------------------------------------------
                                                              MAR 31      DEC 31     SEP 30      JUN 30      MAR 31
                                                               2000        1999       1999        1999        1999
                                                              ------      ------     ------      ------      ------
                                                                              (DOLLARS IN THOUSANDS)

<S>                                                           <C>         <C>        <C>         <C>         <C>
Non-accrual mortgage loans............................        $1,812      $2,100     $1,100      $2,118      $2,266
Non-accrual consumer loans............................            63          65         49          88         129
Non-accrual commercial leases.........................           163           -          -           -           -
                                                              ------      ------     ------      ------      ------
Total non-accrual loans...............................        $2,038      $2,165     $1,149      $2,206      $2,395
                                                              ======      ======     ======      ======      ======
Loans 90 days or more
  delinquent and still accruing.......................           118         118         82         219          54
                                                              ------      ------     ------      ------      ------
Total non-performing loans............................        $2,156      $2,283     $1,231      $2,425      $2,449
                                                              ======      ======     ======      ======      ======
Non-accrual investment securities.....................             -           -        235         235         233
Total foreclosed real estate net of related allowance
 for losses ..........................................           960         960      1,893         621         512
                                                              ------      ------     ------      ------      ------
Total non-performing assets...........................        $3,116      $3,243     $3,359      $3,281      $3,194
                                                              ======      ======     ======      ======      ======
Non-performing loans to gross loans receivable........          0.54%       0.61%      0.34%       0.81%       0.83%
                                                              ======      ======     ======      ======      ======
Non-performing assets to total assets ................          0.61%       0.63%      0.64%       0.70%       0.67%
                                                              ======      ======     ======      ======      ======
</TABLE>


At March 31, 2000, non-performing loans decreased to $2.2 million from $2.4
million at June 30, 1999. The decrease is due primarily to the decrease in
non-accrual mortgage loans and loans 90 days or more delinquent and still
accruing, which consist primarily of credit card loans. Impaired loans decreased
to $0 at March 31, 2000 from $1.1 million at June 30, 1999. Impaired loans
consist primarily of commercial and commercial real estate loans for which,
based on current information and events, it is probable that the Bank will be
unable to collect all amounts due according to the contractual terms of the loan
agreement. Management believes that these loans are adequately collateralized
and/or have specific loan loss reserves established which are adequate to absorb
probable losses related to resolution.

Potential problem loans are loans where known information about possible credit
problems of borrowers causes management to have doubts as to the ability of such
borrowers to comply with the present loan repayment terms. The decision by
management to categorize a loan as a potential problem loan does not necessarily
indicate that the Company expects losses to occur, but that management
recognizes there is a higher degree of risk associated with these performing
loans. At March 31, 2000, the Bank had a potential problem loan with a balance
of $1.9 million secured by 13 first lien one-to-four family mortgages held in
trust for the benefit of the Bank and a secondary payee under the loan
obligation. The original balance of the loan was $4.1 million. At March 31,
2000, the loan was current as to payment of principal and interest. Proceeds
from payments made to the trustee from potential homeowners (occupying the
properties under 2-year leases with an option to purchase at an agreed upon
price upon expiration of the lease-term), or from any other eventual sale of the
one-to-four family residences securing the obligation, are to be applied by the
trustee first to the repayment of the total of all principal and interest due
the Bank, with any excess over such amounts becoming due to the secondary payee.
The Bank assumed responsibility for receipt and servicing of payments from the
potential homeowners upon the secondary



                                       22
<PAGE>   25


payee's filing of bankruptcy in June 1999. The Bank also removed a third party
bank as the bond trustee and appointed itself as trustee in December 1999. The
one-to-four family properties securing the obligation are located in the Bank's
primary lending area and management believes the underlying value of the
properties and the Bank's first lien status are sufficient to prevent any
significant loss from this credit.

ALLOWANCE FOR LOAN LOSSES

The following table sets forth an analysis of the Bank's allowance for loan
losses:


<TABLE>
<CAPTION>

                                                                NINE MONTHS           YEAR             NINE MONTHS
                                                                   ENDED              ENDED               ENDED
                                                               MAR. 31, 2000      JUNE 30, 1999       MAR. 31, 1999
                                                               -------------      -------------       -------------
                                                                              (DOLLARS IN THOUSANDS)

<S>                                                               <C>                <C>                 <C>
         Balance at beginning of period.....................      $ 2,648            $ 2,329             $ 2,329
         Additions charged to expense:
           Multi-family and commercial real estate..........          342                310                 340
           Consumer.........................................           88                120                  80
           Commercial.......................................          197                 50                  60
                                                                  -------            -------             -------
                                                                      627                480                 480

         Recoveries:
            Consumer........................................           18                 15                   9

         Charge-offs:
            One- to four-family.............................          (30)               (11)                (11)
            Multi-family & commercial real estate...........           (5)               (34)               (171)
            Consumer........................................          (49)              (131)               (113)
                                                                  -------            -------             -------
                                                                      (84)              (176)               (295)
                                                                  -------            -------             -------

         Net charge-offs....................................          (66)              (161)               (286)
                                                                  -------            -------             -------

         Balance at end of period...........................      $ 3,209            $ 2,648             $ 2,523
                                                                  =======            =======             =======

        Allowance for loan losses to
           non-performing loans at end
           of the period....................................      148.86%            109.19%              103.02%
                                                                  =======            =======             =======

        Allowance for loan losses to
           total loans at end of the period.................        0.81%              0.89%                0.85%
                                                                  =======            =======             =======
</TABLE>


The level of allowance for loan losses at March 31, 2000, reflects the continued
low level of charged off loans. Management believes that the allowance for loan
losses is adequate as of March 31, 2000.



                                       23
<PAGE>   26


RESULTS OF OPERATIONS - COMPARISON OF THE THREE MONTHS ENDED
MARCH 31, 2000 AND 1999

GENERAL

Net income for the three months ended March 31, 2000 decreased to $678,000 from
$718,000 for the comparable 1999 period. The decrease in net income was
primarily due to a decrease in gains on the sale of loans and an increase in the
provision for losses on loans. Return on average equity decreased to 8.10% for
the three months ended March 31, 2000 from 8.25% for the comparable 1999 period.
Return on average assets decreased to 0.51% for the three months ended March 31,
2000 from 0.59% for the comparable 1999 period. The decrease in the return on
average equity and the return on average assets is due to the decrease in net
income for the three months ended March 31, 2000. The decrease is primarily due
to an increase in the provision for loan losses and a decrease in non-interest
income, partially offset by an increase in interest income and a decrease in
non-interest expense for the three months ended March 31, 2000 compared to March
31, 1999.

NET INTEREST INCOME

The following table presents certain information related to average
interest-earning assets and liabilities, net interest rate spread and net
interest margin:

<TABLE>
<CAPTION>

                                                              FOR THE THREE MONTHS ENDED MARCH 31,
                                            ----------------------------------------------------------------------
                                                        2000                                    1999
                                            -----------------------------        ---------------------------------
                                                       INTEREST   AVERAGE                     INTEREST     AVERAGE
                                             AVERAGE    EARNED/    YIELD/         AVERAGE      EARNED/      YIELD/
                                             BALANCE     PAID       RATE          BALANCE       PAID         RATE
                                            --------   --------   -------        --------     --------     -------
                                                                  (DOLLARS IN THOUSANDS)
<S>                                         <C>        <C>          <C>          <C>           <C>          <C>
ASSETS:
Interest-earning assets:
  Mortgage loans..........................  $349,726   $ 7,069      8.09%        $268,089      $5,430       8.10%
  Consumer loans..........................     3,363       120     14.27            3,270         144      14.51
  Commercial loans........................    21,138       569     10.77           16,603         381       9.18
                                            --------   -------                   --------     -------
     Total loans..........................   374,227     7,758      8.29          288,662       5,955       8.25
  Securities held-to-maturity:
    Mortgage-backed securities............     1,626        25      6.15           13,000         204       6.28
    Mortgage related securities...........    13,870       249      7.18           41,608         671       6.45
                                            --------   -------                   --------     -------
      Total mortgage-backed
       and related securities.............    15,496       274      7.07           54,608         875       6.41
  Investment and other securities.........    11,083       159      5.74           21,275         280       5.26
  Securities available-for-sale...........   106,356     1,849      6.95          104,007       1,586       6.10
  Federal Home Loan Bank stock............     7,627       133      6.98            6,793         105       6.18
                                            --------   -------                   --------     -------
    Total interest-earning assets.........   514,789    10,173      7.90          475,345       8,801       7.41
Non-interest earning assets...............    13,453                               12,780
                                            --------                             --------
    Total assets..........................  $528,242                             $488,125
                                            ========                             ========

LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits:
  NOW accounts............................  $  2,846        12      1.69%        $  2,805          12       1.71%
  Money market deposit accounts...........    29,217       334      4.57           40,639         464       4.57
  Passbook accounts.......................    19,517       142      2.91           20,765         149       2.87
  Certificates of deposit.................   268,359     4,090      6.10          243,370       3,345       5.50
                                            --------   -------                   --------     -------
    Total deposits........................   319,939     4,578      5.72          307,579       3,970       5.16
Advance payments by borrowers
  for taxes and insurance................      1,171         6      2.05              908           5       2.20
Borrowings................................   161,243     2,305      5.72          131,746       1,874       5.69
                                            --------   -------                   --------     -------
    Total interest-bearing liabilities....   482,353     6,889      5.71          440,233       5,849       5.31
Non-interest bearing deposits
  and liabilities.........................    12,421                               13,081
Shareholders' equity......................    33,468                               34,811
                                            --------                             --------
    Total liabilities and
      shareholders' equity................  $528,242                             $488,125
                                            ========                             ========
Net interest income/interest rate spread..             $ 3,284      2.19%                      $2,952       2.10%
                                                       =======      ====                       ======       ====
Net earning assets/net interest margin....  $ 32,436                2.55%        $ 35,112                   2.48%
                                            ========                ====         ========                   ====

</TABLE>


                                       24
<PAGE>   27


Net interest income before provision for losses on loans increased $332,000, or
11.2%, to $3.3 million for the three months ended March 31, 2000 from $3.0
million for the comparable 1999 period. Interest income increased $1.4 million
for the three months ended March 31, 2000, partially offset by an increase in
interest expense of $1.0 million. The level of net interest income primarily
reflects a 8.3% increase in average interest-earning assets to $514.8 million
for the three months ended March 31, 2000 from $475.3 million for the comparable
1999 period and an increase in interest rate spread to 2.19% for the three
months ended March 31, 2000 from 2.10% for the comparable 1999 period and by a
7.6% decrease in the excess of the Company's average interest-earning assets
over average interest-bearing liabilities to $32.4 million for the three months
ended March 31, 2000 from $35.1 million for the comparable 1999 period. The
increase in interest rate spread was primarily due to the increased balances of
loans with higher yields in the 2000 period as compared to the 1999 period.

INTEREST INCOME

Interest income increased 15.6% to $10.2 million for the three months ended
March 31, 2000 from $8.8 million for the comparable 1999 period. The increase in
interest income was the result of an increase in average interest-earning assets
of 8.3% to $514.8 million for the three months ended March 31, 2000 from $475.3
million for the comparable 1999 period and an increase of 49 basis points in the
yield on interest-earning assets to 7.90% for the three months ended March 31,
2000 from 7.41% for the comparable 1999 period. Interest income on loans
increased 30.3% to $7.8 million for the three months ended March 31, 2000, from
$6.0 million for the comparable 1999 period. The increase was the result of an
increase in the Company's average gross loans of 29.6% to $374.2 million for the
three months ended March 31, 2000 from $288.7 million for the comparable 1999
period and by an increase in average yield to 8.29% for the 2000 period from
8.25% for the comparable 1999 period. Gross loans increased primarily as a
result of the Company purchasing more loans in the secondary market and
increases in multi-family and commercial components of the portfolio and
retaining substantially all of its adjustable and short-term fixed rate loan
originations. See "Change in Financial Condition" for a discussion of the
increase in gross loans. The increase in yield is attributable to the increase
in loans originated and purchased at higher interest rates since the period
ending March 31, 1999 and increases in adjustable rate loans.

Interest income on mortgage-backed securities decreased 87.7% to $25,000 for the
three months ended March 31, 2000 from $204,000 for the comparable 1999 period.
The decrease was primarily due to a decrease in average balances to $1.6 million
for the three months ended March 31, 2000 from $13.0 million for the comparable
1999 period and by a decrease in average yield to 6.15% for the 2000 period from
6.28% for the 1999 period. Interest income on mortgage-related securities
decreased 62.9% to $249,000 for the three months ended March 31, 2000 from
$671,000 for the comparable 1999 period. The decrease was primarily due to a
decrease in average balances to $13.9 million for the three months ended March
31, 2000 from $41.6 million for the comparable 1999 period, offset by an
increase in yield to 7.18% for the 2000 period from 6.45% for the 1999 period.
The decrease in average balances mortgage-backed securities and mortgage-related
securities was primarily due to the sale of $2.8 million and $23.1 million,
respectively, in the 2000 period. The increase in average yield on
mortgage-related securities was primarily due to accelerated amortization of
purchase premiums on mortgage related securities due to faster than projected
principal repayments during the 1999 period. The decrease in average balances of
mortgage-backed and related securities is due to management's decision to
replace securities that were sold and repaid with loans. Interest income on
investment securities and securities available-for-sale and investment and other
securities decreased 7.7% to $2.0 million for the three months ended March 31,
2000 from $1.9 million for the comparable 1999 period. The increase was
primarily due to an increase in average yield to 6.84% for the three months
ended March 31, 2000 from 5.96% for the comparable 1999 period offset by a
decrease in average balances to $117.4 million for the three months ended March
31, 2000 from $125.3 million for the 1999 period. The decrease in securities
available-for-sale was due to management's decision to sell securities during
the 2000 period to fund loan originations and purchases. The increased average
yield was primarily attributable to the increase in average maturity of the
available-for-sale investments during the 2000 period.



                                       25
<PAGE>   28




INTEREST EXPENSE

Interest expense increased 17.8% to $6.9 million for the three months ended
March 31, 2000 from $5.8 million for the comparable 1999 period. The increase
was the result of an 9.6% increase in the average amount of interest-bearing
liabilities to $482.4 million for the three months ended March 31, 2000 compared
to $440.2 million for the comparable 1999 period and by an increase in the
average rate paid on interest-bearing liabilities to 5.71% for the 2000 period
from 5.31% for the 1999 period. The increased balances of certificate of deposit
accounts and borrowings at higher average interest rates was the primary reason
for the increase in the average rate paid on the interest-bearing liabilities
for the three months ended March 31, 2000 as compared to the 1999 period.
Interest expense on deposits increased 15.3% to $4.6 million for the three
months ended March 31, 2000 from $4.0 million for the comparable 1999 period.
The increase was the result of an increase in the average rate paid to 5.72% for
the three months ended March 31, 2000 from 5.16% for the 1999 period and by an
increase in average balances of 4.0% to $319.9 million for the three months
ended March 31, 2000 from $307.6 million for the comparable 1999 period. The
increase in deposits was primarily due to an increase of 10.3% in certificates
of deposit accounts to $268.4 million for the three months ended March 31, 2000
from $243.4 million for the comparable 1999 period, with an increase in the
average rate paid to 6.10% for the 2000 period from 5.50% for the 1999 period.
NOW accounts increased 1.5% to $2.846 million for the three months ended March
31, 2000 from $2.805 million for the comparable 1999 period and by an increase
in average rate paid to 1.69% for the 2000 period from 1.71% for the 1999
period. Offsetting the increases in deposits was a decrease in money market
deposit accounts of 28.1% to $29.2 million for the three months ended March 31,
2000 from $40.6 million for the comparable 1999 period. Money market deposit
accounts decreased primarily due to higher rates offered in the Company's local
market during the three months ended March 31, 2000. The Company's increase in
certificates of deposit was the result of aggressive marketing and pricing and
the use of brokered certificates of deposit. Of the $268.4 million in the
average balance of certificates of deposit for the three months ended March 31,
2000, $190.5 million, or 71.0%, represented brokered certificates of deposit
compared to $117.4 million, or 48.2%, for the 1999 period. The average rate paid
on brokered certificates of deposit increased to 5.87% for the three months
ended March 31, 2000 from 5.72% for the comparable 1999 period. The increase was
primarily due to the increased interest rate environment in the 2000 period as
compared to the 1999 period. Interest on borrowings (FHLB advances and reverse
repurchase agreements) increased 23.0% to $2.3 million for the three months
ended March 31, 2000 from $1.9 million for the comparable 1999 period. The
increase was primarily due to the increase in average balances of FHLB advances
and reverse repurchase agreements of 22.4% to $161.2 million for the three
months ended March 31, 2000 from $131.7 million for the comparable 1999 period
and an increase in the average rate paid to 5.72% for the 2000 period from 5.69%
for the 1999 period.

PROVISION FOR LOSSES ON LOANS

The provision for losses on loans increased 140.7% to $337,000 for the three
months ended March 31, 2000 from $140,000 for the comparable 1999 period. The
level of allowance for losses on loans generally is determined by the Bank's
historical loan loss experience, the condition and composition of the Bank's
loan portfolio, and existing general economic conditions. Management anticipates
that as the Company's volume of multi-family and commercial/non-residential real
estate lending activity continues to increase, the Company will continue to
build a higher level of allowance for loan losses established through a
provision for loan losses.* Based on management's evaluation of the loan
portfolio and the increase in gross loans during the three months ended March
31, 2000, the allowance for losses on loans increased 23.1% to $3.2 million at
March 31, 2000 compared to $2.6 million at June 30, 1999. While the allowance
for losses on loans increased, the allowance for loan losses as a percentage of
gross loans decreased to 0.81% at March 31, 2000 from 0.89% at June 30, 1999
reflecting the continued low level of loans charged off. The amount of
non-performing loans at March 31, 2000 was $2.2 million, or 0.54% of gross
loans, compared to $2.4 million, or 0.81% of gross loans, at June 30, 1999 and
$2.4 million or 0.83% of gross loans at March 31, 1999. Management believes that
these loans are adequately collateralized and/or have specific loan loss
reserves established which are adequate to absorb probable losses related to
resolution.



                                       26
<PAGE>   29



NON-INTEREST INCOME

Non-interest income decreased 84.4% to $89,000 for the three months ended March
31, 2000 from $573,000 for the comparable 1999 period. The largest components of
the decrease were a decrease in gains on the sale of loans to a loss of
($188,000) for the three months ended March 31, 2000 from $180,000 for the
comparable 1999 period, a decrease in gains on the sale of securities and
mortgage-backed and related securities to a loss of $14,000 for the three months
ended March 31, 2000 from $0 for the comparable 1999 period, a decrease in
service charges on loans to $77,000 for the three months ended March 31, 2000
from $127,000 for the comparable 1999 period and a decrease on other income to
$60,000 for the three months ended March 31, 2000 from $121,000 for the
comparable 1999 period. Partially offsetting the decreases in non-interest
income was an increase in loan servicing fees to $12,000 for the three months
ended March 31, 2000 from $7,000 for the comparable 1999 period and an increase
in insurance commissions to $36,000 for the three months ended March 31, 2000
from $31,000 for the comparable 1999 period. The decrease in gains on the sale
of loans reflects the write-down to market value of loans held-for-sale at March
31, 2000 due to the higher level of interest rates. The loss on sale of
securities and mortgage-backed and related securities reflects the sale of $25.0
million in mortgage-backed and related securities used to fund loan growth.

NON-INTEREST EXPENSE

Non-interest expense decreased 10.5% to $2.1 million for the three months ended
March 31, 2000 from $2.3 million for the comparable 1999 period. The decrease
was primarily due to a decrease in compensation and benefits expense of $157,000
to $1.2 million for the three months ended March 31,2000 from $1.4 million for
the comparable 1999 period, a decrease in occupancy and equipment expense of
$132,000 to $347,000 for the three months ended March 31, 2000 from $449,000 for
the comparable 1999 period, a decrease in deposit insurance premiums of $28,000
to $17,000 for the three months ended March 31, 2000 from $45,000 for the
comparable 1999 period and a decrease in marketing expense of $9,000 to $87,000
for the three months ended March 31, 2000 from $96,000 for the comparable 1999
period. Partially, offsetting the decreases was an increase in other
non-interest expense of $51,000 to $425,000 for the three months ended March 31,
2000 from $374,000 for the comparable 1999 period. The decrease in compensation
and benefits expense primarily relates to a decrease in the accrual for
incentive compensation and a lower number of full time equivalent employees. The
decrease in occupancy and equipment expense is primarily due to a refund credit
for telecommunications equipment received in the 2000 period. The decrease in
deposit insurance premiums relates to a decreased premium rate charged by the
FDIC for deposit insurance in the 2000 period. The increase in other
non-interest expense is primarily due to increases in printing, office supplies,
organization dues, legal and other miscellaneous expenses.



                                       27
<PAGE>   30




RESULTS OF OPERATIONS - COMPARISON OF THE NINE MONTHS ENDED
MARCH 31, 2000 AND 1999

GENERAL

Net income for the nine months ended March 31, 2000 increased to $2.4 million
from $2.2 million for the comparable 1999 period. The increase in net income was
primarily due to an increase in net interest income, offset by an increase in
the provision for losses on loans and a decrease in non-interest income. Return
on average equity increased to 9.48% for the nine months ended March 31, 2000
from 8.64% for the comparable 1999 period. Return on average assets decreased to
0.62% for the nine months ended March 31, 2000 from 0.63% for the comparable
1999 period. The decrease in the return on average equity and the return on
average assets is due to the decrease in net income for the nine months ended
March 31, 2000. The decrease is primarily due to an increase in the provision
for loan losses and a decrease in non-interest income, partially offset by an
increase in interest income and a decrease in non-interest expense for the three
months ended March 31, 2000 compared to March 31, 1999.

NET INTEREST INCOME

The following table presents certain information related to average
interest-earning assets and liabilities, net interest rate spread and net
interest margin:

<TABLE>
<CAPTION>

                                                                FOR THE NINE MONTHS ENDED MARCH 31,
                                            ----------------------------------------------------------------------
                                                        2000                                    1999
                                            -----------------------------        ---------------------------------
                                                       INTEREST   AVERAGE                     INTEREST     AVERAGE
                                             AVERAGE    EARNED/    YIELD/         AVERAGE      EARNED/      YIELD/
                                             BALANCE     PAID       RATE          BALANCE       PAID         RATE
                                            --------   --------   -------        --------     --------     -------
                                                                  (DOLLARS IN THOUSANDS)
<S>                                         <C>        <C>          <C>          <C>           <C>          <C>
ASSETS:
Interest-earning assets:
  Mortgage loans..........................  $315,329   $ 19,107      8.08%       $265,383      $16,385       8.23%
  Consumer loans..........................     3,486        365     13.96           4,273          437      13.64
  Commercial loans........................    20,441      1,577     10.29          14,588        1,002       9.16
                                            --------   --------                  --------      -------
     Total loans..........................   339,256     21,049      8.27         284,244       17,824       8.36
  Securities held-to-maturity:
    Mortgage-backed securities............     6,864        322      6.25          15,470          751       6.47
    Mortgage related securities...........    34,304      1,681      6.53          43,117        2,263       7.00
                                            --------   --------                  --------      -------
     Total mortgage-backed
       and related securities.............    41,168      2,003      6.49          58,587        3,014       6.86
  Investment and other securities.........     9,526        404      5.65          19,313          792       5.47
  Securities available-for-sale...........    99,011      4,961      6.68          85,934        4,095       6.35
  Federal Home Loan Bank stock............     7,246        385      7.08           6,539          321       6.55
                                            --------   --------                  --------      -------
    Total interest-earning assets.........   496,207     28,802      7.74         454,617       26,046       7.64
Non-interest earning assets...............    18,729                               13,708
                                            --------                             --------
    Total assets..........................  $514,936                             $468,325
                                            ========                             ========

LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits:
  NOW accounts............................  $  2,837         37      1.74%       $  2,735           35       1.71%
  Money market deposit accounts...........    32,607      1,095      4.48          35,852        1,361       5.06
  Passbook accounts.......................    20,133        440      2.91          21,127          461       2.91
  Certificates of deposit.................   249,625     10,638      5.68         230,526        9,829       5.68
                                            --------   --------                  --------      -------
    Total deposits........................   305,202     12,210      5.33         290,240       11,686       5.37
Advance payments by borrowers
  for taxes and insurance................      3,242         57      2.34           3,000           60       2.67
Borrowings................................   159,449      6,801      5.69         128,134        5,650       5.88
                                            --------   --------                  --------      -------
    Total interest-bearing liabilities....   467,893     19,068      5.43         421,374       17,396       5.50
Non-interest bearing deposits
  and liabilities.........................    13,158                               12,615
Shareholders' equity......................    33,885                               34,336
                                            --------                             --------
    Total liabilities and
      shareholders' equity................  $514,936                             $468,325
                                            ========                             ========
Net interest income/interest rate spread..              $9,734      2.30%                      $ 8,650      2.13%
                                                        ======      ====                       =======      ====
Net earning assets/net interest margin....  $ 28,314                2.62%        $ 33,243                   2.54%
                                            ========                ====         ========                   ====
</TABLE>



                                       28
<PAGE>   31


Net interest income before provision for losses on loans increased $1.1 million
or 12.5% to $9.7 million for the nine months ended March 31, 2000 from $8.7
million for the comparable 1999 period. Interest income increased $2.8 million
for the nine months ended March 31, 2000, partially offset by an increase in
interest expense of $1.7 million. The level of net interest income primarily
reflects a 9.1% increase in average interest-earning assets to $496.2 million
for the nine months ended March 31, 2000 from $454.6 million for the comparable
1999 period, an increase in interest rate spread to 2.31% for the nine months
ended March 31, 2000 from 2.13% for the comparable 1999 period, offset by a
14.8% decrease in the excess of the Company's average interest-earning assets
over average interest-bearing liabilities to $28.3 million for the nine months
ended March 31, 2000 from $33.2 million for the comparable 1999 period.

INTEREST INCOME

Interest income increased 10.6% to $28.8 million for the nine months ended March
31, 2000 from $26.0 million for the comparable 1999 period. The increase in
interest income was the result of an increase in average interest-earning assets
of 9.1% to $496.2 million for the nine months ended March 31, 2000 from $454.6
million for the comparable 1999 period and by an increase of 10 basis points in
the yield on interest-earning assets to 7.74% for the nine months ended March
31, 2000 from 7.64% for the comparable 1999 period. Interest income on loans
increased 18.1% to $21.0 million for the nine months ended March 31, 2000 from
$17.8 million for the comparable 1999 period. The increase was the result of an
increase in average gross loans of 19.4% to $339.3 million for the nine months
ended March 31, 2000 from $284.2 million for the comparable 1999 period,
partially offset by a decrease in average yield to 8.27% for the nine months
ended March 31, 2000 from 8.36% for the comparable 1999 period. Gross loans
increased primarily as a result of the Company retaining substantially all of
its adjustable and short-term fixed rate loan originations and purchasing more
loans in the secondary market. The decrease in yield is attributable to the
increase in loans refinanced at lower interest rates in fiscal 1999. Interest
income on mortgage-backed securities decreased 57.1% to $322,000 for the nine
months ended March 31, 2000 from $751,000 for the comparable 1999 period. The
decrease was primarily due to a decrease in average balances to $6.9 million for
the nine months ended March 31, 2000 from $15.5 million for the comparable 1999
and a decrease in average yield to 6.25% for the 2000 period from 6.47% for the
1999 period. Interest income on mortgage-related securities decreased 25.7% to
$1.7 million for the nine months ended March 31, 2000 from $2.3 million for the
comparable 1999 period. The decrease was primarily due to a decrease in average
yield to 6.53% for the nine months ended March 31, 2000 from 7.00% for the
comparable 1999 period and by a decrease in average balances to $34.3 million
for the nine months ended March 31, 2000 from $43.1 million for the comparable
1999 period. The decrease in average yield on mortgage-backed securities and
mortgage-related securities was primarily due to the adjustment in the
adjustable rate securities portion of this portfolio which decreased due to
lower interest rates and the accelerated amortization of purchase premiums on
mortgage-backed securities due to faster than projected principal repayments
during the 1999 period. The decline in average balances of mortgage-backed
securities is due to management's decision to increase the securities
available-for-sale portfolio. Interest income on investment securities and
securities available-for-sale increased 9.8% to $5.4 million for the nine months
ended March 31, 2000 from $4.9 million for the comparable 1999 period. The
increase was primarily due to an increase in average balance to $108.5 million
for the nine months ended March 31, 2000 from $105.2 million for the 1999 period
and an increase in average yield to 6.59% for the 2000 period from 6.19% for the
1999 period. The higher average yield was primarily attributable to the increase
in the average maturity of the securities in this portfolio.

INTEREST EXPENSE

Interest expense increased 9.6% to $19.1 million for the nine months ended March
31, 2000 from $17.4 million for the comparable 1999 period. The increase was the
result of an 11.0% increase in the average amount of interest-bearing
liabilities to $467.9 million for the nine months ended March 31, 2000 compared
to $421.4 million for the comparable 1999 period, partially offset by a decrease
in the average rate paid on interest-bearing liabilities to 5.43% for the 2000
period from 5.50% for the 1999 period. The increased balances of certificates of
deposit (including brokered deposits), NOW accounts and borrowings at lower
average interest rates was the primary reason for the decrease in the average
rate paid on the interest-bearing liabilities for the nine months ended March
31, 2000 as compared to the comparable 1999 period.



                                       29
<PAGE>   32


Interest expense on deposits increased 4.5% to $12.2 million for the nine months
ended March 31, 2000 from $11.7 million for the comparable 1999 period. The
increase was the result of an increase in average balances of 5.2% to $305.2
million for the nine months ended March 31, 2000 from $290.2 million for the
comparable 1999 period, offset by a decrease in the average rate paid to 5.33%
for the nine months ended March 31, 2000 from 5.37% for the 1999 period. The
increase in deposits was primarily due to an increase of 8.3% in certificates of
deposit (including brokered deposits) to $249.6 million for the nine months
ended March 31, 2000 from $230.5 million for the 1999 period. NOW accounts
increased 3.7% to $2.8 million for the nine months ended March 31, 2000 from
$2.7 million for the comparable 1999 period, with an increase in average rate
paid to 1.74% for the 2000 period from 1.71% for the 1999 period. The increases
in certificates of deposit and NOW accounts were offset by a decrease in money
market deposit accounts of 9.1% to $32.6 million for the nine months ended March
31, 2000 from $35.9 million for the comparable 1999 period, with a decrease in
the average rate paid on such deposits to 4.48% for the 2000 period from 5.06%
for the 1999 period and a decrease in passbook accounts of 4.7% to $20.1 million
for the nine months ended March 31, 2000 from $21.1 million for the comparable
1999 period. Money market deposit accounts decreased primarily due to higher
rates offered in the Company's local market during the nine months ended March
31, 2000. The Company's increase in certificates of deposit was the result of
aggressive marketing and pricing and the use of brokered certificates of
deposit. Of the $249.6 million in the average balance of certificates of deposit
for the nine months ended March 31, 2000, $153.9 million, or 61.7%, represented
brokered certificates of deposit compared to $101.3 million, or 44.0%, for the
1999 period. The average rate paid on brokered certificates of deposit decreased
to 5.66% for the nine months ended March 31, 2000 from 5.72% for the comparable
1999 period. The decrease was primarily due to the longer average maturity of
the brokered deposits in the 1999 period. Interest on borrowings (FHLB advances
and reverse repurchase agreements) increased 20.4% to $6.8 million for the nine
months ended March 31, 2000 from $5.7 million for the comparable 1999 period.
The increase was primarily due to the increase in average balance to $159.4 for
the nine months ended March 31, 2000 from $128.1 for the comparable 1999 period,
partially offset by a decrease in average rate paid to 5.69% for the nine months
ended March 31, 2000 from 5.88% for the 1999 period.

PROVISION FOR LOSSES ON LOANS

The provision for losses on loans increased 30.6% to $627,000 for the nine
months ended March 31, 2000 from $480,000 for the comparable 1999 period. For a
discussion of the factors considered by management in determining the
appropriate level of allowance for losses on loans to be established through a
provision for losses on loans, see comments under "Provision for Losses on
Loans" contained in the section entitled, "Results of Operations - Comparison of
the Three Months Ended March 31, 2000 and 1999."

NON-INTEREST INCOME

Non-interest income decreased 49.9% to $883,000 for the nine months ended March
31, 2000 from $1.8 million for the comparable 1999 period. The largest
components of the decrease was a decrease in gains on the sale of loans to loss
of ($35,000) for the nine months ended March 31, 2000 from $832,000 for the
comparable 1999 period, a decrease in other income to $166,000 for the nine
months ended March 31, 2000 from $209,000 for the comparable 1999 period and a
decrease in service charges on loans to $235,000 for the nine months ended March
31, 2000 from $262,000 for the comparable 1999 period. Partially offsetting the
decreases in non-interest income was an increase in gains on the sale of
securities and mortgage-backed and related securities to $48,000 for the nine
months ended March 31, 2000 from $35,000 for the comparable 1999 period, an
increase in service charges on deposit accounts to $347,000 for the nine months
ended March 31, 2000 from $341,000 for the comparable 1999, an increase in
insurance commissions to $86,000 for the nine months ended March 31, 2000 from
$60,000 for the comparable 1999 period and an increase in loan servicing fees to
$36,000 for the nine months ended March 31, 2000 from $20,000 for the comparable
1999 period. The decrease in gains on the sale of loans reflects the decrease in
long-term fixed rate loans sold into the secondary market during the 2000 period
as compared to the 1999 period due to the higher level of interest rates that
led to a lower level of mortgage loans refinanced in the 2000 period as compared
to the 1999 period. Also, the decrease in gains on the sale of loans reflects
the write-down to market value of loans held-for-sale at March 31, 2000 due to
the higher level of interest rates.



                                       30
<PAGE>   33



NON-INTEREST EXPENSE

Non-interest expense decreased 1.7% to $6.5 million for the nine months ended
March 31, 2000 from $6.6 million for the comparable 1999 period. The decrease
was primarily due to a decrease in compensation and benefits expense of $54,000
to $3.8 million for the nine months ended March 31, 2000 from $3.9 million for
the comparable 1999 period, a decrease in occupancy and equipment expense of
$78,000 to $1.164 million for the nine months ended March 31, 2000 from $1.242
million for the comparable 1999 period and a decrease in deposit insurance
premiums of $22,000 to $105,000 for the nine months ended March 31, 2000 from
$127,000 for the comparable 1999 period. Partially offsetting the decreases in
non-interest income was a increase in marketing expense of $29,000 to $289,000
for the nine months ended March 31, 2000 from $260,000 for the comparable 1999
period and a increase in other non-interest expense of $11,000 to $1.089 million
for the nine months ended March 31, 2000 from $1.078 million for the comparable
1999 period. The decrease in compensation and benefits expense primarily relates
to a decrease in the accrual for incentive compensation and a lower number of
full time equivalent employees. The decrease in occupancy and equipment expense
is primarily due to a refund credit for telecommunications equipment received in
the 2000 period. The decrease in deposit insurance premiums relates to a
decreased premium rate charged by the FDIC for deposit insurance in the 2000
period. The increase in other non-interest expense is primarily due to increases
in printing, office supplies, organization dues, legal and other miscellaneous
expenses.

IMPACT OF YEAR 2000

The Company believes it has adequately addressed the Year 2000 issue. The
Company identified areas of computer and other operations critical for the
delivery of its loan and deposit products. The majority of the Company's
applications used in operations were purchased from outside vendors. The vendors
providing the software were responsible for maintenance of the systems and
modifications to enable uninterrupted usage after December 31, 1999. The
Company's plan included obtaining certification of compliance from third parties
and testing all of the impacted applications (both internally developed and
third party provided). Testing of the system and conversion activities were
completed as of June 30, 1999. There were no mission critical systems which were
non-compliant. The Company developed and finalized contingency plans for any
adverse situations that may have arisen related to Year 2000. The Company's plan
also included reviewing any potential risks associated with loan and deposit
data base information due to the Year 2000 issue.

Subsequent to January 1, 2000, all computer systems continue to function as
expected and has not affected the ability of the Company to deliver its products
and services to date. Management will continue to monitor computer systems for
problems or errors associated with their operation. Based on currently available
information, management does not anticipate that the cost to address the Year
2000 issues will have a material adverse impact on the Company's financial
position.* Direct expenditures for the nine months ended March 31, 2000 and for
the fiscal year ended June 30, 1999 totaled $13,100 and $37,800, respectively.
Direct expenditures included capital expenditures for compliant equipment and
software, write-offs of non-compliant equipment and software upgrades. The
expenditures were funded by increases in the Company's non-interest expense
budget.

The Company also made inquiries and reviewed plans of certain third parties,
such as commercial loan customers, where Year 2000 failures could have resulted
in a significant adverse impact on the Company. The Company had completed the
inquiry and review process and was satisfied the Bank would not be subject to
significant adverse impact. Based on information available, the Bank has not
experienced any difficulties with third parties related to the Year 2000 issue.



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ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

A derivative financial instrument includes futures, forwards, interest rate
swaps, option contracts, and other financial instruments with similar
characteristics. The Company currently does not enter into futures, forwards,
swaps or options but has decided to purchase interest rate caps to manage the
interest rate risk on the Company's short-term wholesale certificates of
deposit. The Company is party to financial instruments with off-balance sheet
risk in the normal course of business to meet the financing needs of its
customers. These financial instruments consist primarily of commitments to
extend credit. These instruments involve to varying degrees, elements of credit
and interest rate risk in excess of the amount recognized in the consolidated
balance sheets. Commitments to extend credit are agreements to lend to a
customer as long as there is no violation of any condition established in the
contract. Commitments generally have fixed expiration dates and may require
collateral from the borrower if deemed necessary by the Company.

The information required herein pursuant to Item 305 of Regulation S-K is
incorporated by reference in sections entitled "Liquidity and Capital Resources"
from pages 15 to 17 and "Asset/Liability Management" from pages 19 to 20 hereof.



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<PAGE>   35


                           PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         From time to time the Company and the Bank are parties to legal
         proceedings arising out of its lending activities and other operations.
         However, there are no pending legal proceedings of which the Company or
         the Bank is a party which, if determined adversely to the Company or
         the Bank, would have a material adverse effect on the consolidated
         financial position of the Company.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

         Not applicable.

ITEM 3.  DEFAULT UPON SENIOR SECURITIES

         Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         Not applicable.

ITEM 5.  OTHER INFORMATION

         On April 26, 2000, the Company announced it had declared a dividend of
         $0.05 per share on the common stock of the Company. The dividend will
         be payable on May 24, 2000 to shareholders of record as of May 10,
         2000.

         On February 1, 2000, the Company announced it had adopted a share
         repurchase program for its common stock to purchase up to 5%, or
         approximately 135,000 shares. The repurchased shares will become
         treasury shares and will be used for general corporate purposes. As of
         March 31, 2000, the Company had purchased 134,700 shares of common
         stock pursuant to the repurchase program and completed the repurchase
         program.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         Exhibits:

          10.1 Ledger Capital Corp. Employment Agreement with James D. Smessaert
          10.2 Ledger Capital Corp. Employment Agreement with Peter A. Gilbert
          10.3 West Allis Savings Bank Employment Agreement with James D.
               Smessaert
          10.4 West Allis Savings Bank Employment Agreement with Peter A.
               Gilbert
          11   Computation of Earnings per Share - See Note 2 to the unaudited
               Consolidated Financial Statements


          No reports on Form 8-K were filed during the quarter for which this
          report was filed.

            * * * * * * * * * * * * * * * * * * * * * * * * * * * * *


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<PAGE>   36


                                   SIGNATURES

Pursuant to the requirement 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.

                                   Ledger Capital Corp.
                                   --------------------
                                       (Registrant)



Date:  April 27, 2001              /s/    James D. Smessaert
                                   ---------------------------------------------
                                   James D. Smessaert
                                   Chairman of the Board
                                   Chief Executive Officer

Date: April 27, 2001               /s/    Arthur E. Thompson
                                   ---------------------------------------------
                                   Arthur E. Thompson
                                   Chief Financial Officer



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<PAGE>   37



                                  EXHIBIT INDEX

Exhibit No.                                 Description

   10.1     Ledger Capital Corp. Employment Agreement with James D. Smessaert
   10.2     Ledger Capital Corp. Employment Agreement with Peter A. Gilbert
   10.3     West Allis Savings Bank Employment Agreement with James D. Smessaert
   10.4     West Allis Savings Bank Employment Agreement with Peter A. Gilbert





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