|   | ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE             |   |
|--------|--------|---------------------------------------------------------------------|--------|
|   |   | SECURITIES EXCHANGE ACT OF 1934                                     |   |
|   |   |                                                                |   |
|   |   | For the quarterly period ended March 31, 2011                       |   |
|   |   |                                                                |   |
|   |   | OR                                                                  |   |
|   |   |                                                                |   |
|   | o      | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE            |   |
|   |   | SECURITIES EXCHANGE ACT OF 1934                                     |   |
|   |   |                                                                |   |
|   |   | For the transition period from ________________ to ________________ |   |

| Indiana                                                        |   | 35-1934975                           |
|----------------------------------------------------------------|--------|--------------------------------------|
| (State or other jurisdiction of incorporation or organization) |   | (I.R.S. Employer Identification No.) |
|                                                           |   |                                 |
|                                                           |   |                                 |
| 101 Main Street, Lafayette, Indiana                            |   | 47901                                |
| (Address of principal executive offices)                       |   | (Zip Code)                           |

| Large Accelerated Filer o                                            | Accelerated Filer o              |
|----------------------------------------------------------------------|----------------------------------|
| Non-Accelerated Filer o(Do not check if a smaller reporting company) | Smaller Reporting Company ý |

| Class                                  |   | Outstanding at May 13, 2011 |
|----------------------------------------|--------|-----------------------------|
| Common Stock, $.01 par value per share |   | 1,553,525 shares            |

----

| PART I     | FINANCIAL INFORMATION                                                                       | 1      |
|------------|---------------------------------------------------------------------------------------------|--------|
|       |                                                                                        |   |
| Item 1.    | Financial Statements                                                                        | 1      |
|       |                                                                                        |   |
|       | Consolidated Condensed Balance Sheets                                                       | 1      |
|       |                                                                                        |   |
|       | Consolidated Condensed Statements of Income                                                 | 2      |
|       |                                                                                        |   |
|       | Consolidated Condensed Statements of Changes in Shareholders’ Equity                  | 3      |
|       |                                                                                        |   |
|       | Consolidated Condensed Statements of Cash Flows                                             | 4      |
|       |                                                                                        |   |
|       | Notes to Consolidated Condensed Financial Statements                                        | 5      |
|       |                                                                                        |   |
| Item 2.    | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 19     |
|       |                                                                                        |   |
| Item 3.    | Quantitative and Qualitative Disclosures About Market Risk                                  | 35     |
|       |                                                                                        |   |
| Item 4.    | Controls and Procedures.                                                                    | 35     |
|       |                                                                                        |   |
| PART II.   | OTHER INFORMATION                                                                           | 35     |
|       |                                                                                        |   |
| Item 1.    | Legal Proceedings                                                                           | 35     |
|       |                                                                                        |   |
| Item 1A.   | Risk Factors                                                                                | 35     |
|       |                                                                                        |   |
| Item 2.    | Unregistered Sales of Equity Securities and Use of Proceeds                                 | 36     |
|       |                                                                                        |   |
| Item 3.    | Defaults Upon Senior Securities                                                             | 36     |
|       |                                                                                        |   |
| Item 4.    | [Removed and Reserved]                                                                      | 36     |
|       |                                                                                        |   |
| Item 5.    | Other Information                                                                           | 36     |
|       |                                                                                        |   |
| Item 6.    | Exhibits                                                                                    | 36     |
|       |                                                                                        |
| SIGNATURES | 37                                                                                          |

----

| Item 1. | Financial Statements |
|---------|----------------------|

|                                                                    |   | March 31,2011 |    |   | December 31,2010 |   |
|-------------------------------------------------------------------------|--------|---------------|---------|--------|------------------|--------|
|                                                                    |   | (unaudited)   |    |   |             |   |
| Assets                                                                  |   |          |    |   |             |   |
| Cash and due from banks                                                 |   | $             | 8,495   |   |             | $      | 10,593 |   |
| Short-term investments                                                  |   |          | 4,166   |   |             |   | 2,980 |   |
| Cash and cash equivalents                                               |   |          | 12,661  |   |             |   | 13,573 |   |
| Available-for-sale securities                                           |   |          | 11,994  |   |             |   | 11,805 |   |
| Loans held for sale                                                     |   |          | 489     |   |             |   | 2,265 |   |
| Total loans                                                             |   |          | 322,177 |   |             |   | 326,153 |   |
| Less: Allowance for loan losses                                         |   |          | (6,547  | )      |             |   | (5,343 | ) |
| Net loans                                                               |   |          | 315,630 |   |             |   | 320,810 |   |
| Premises and equipment, net                                             |   |          | 6,099   |   |             |   | 6,116 |   |
| Federal Home Loan Bank stock, at cost                                   |   |          | 3,583   |   |             |   | 3,583 |   |
| Bank owned life insurance                                               |   |          | 6,306   |   |             |   | 6,264 |   |
| Interest receivable and other assets                                    |   |          | 7,015   |   |             |   | 7,431 |   |
| Total Assets                                                            |   | $             | 363,777 |   |             | $      | 371,847 |   |
|                                                                    |   |          |    |   |             |   |   |   |
| Liabilities and Shareholders’ Equity                              |   |          |    |   |             |   |   |   |
| Liabilities                                                             |   |          |    |   |             |   |   |   |
| Deposits                                                                |   | $             | 304,929 |   |             | $      | 311,458 |   |
| Federal Home Loan Bank advances                                         |   |          | 20,500  |   |             |   | 22,500 |   |
| Interest payable and other liabilities                                  |   |          | 2,543   |   |             |   | 2,312 |   |
| Total liabilities                                                       |   |          | 327,972 |   |             |   | 336,270 |   |
|                                                                    |   |          |    |   |             |   |   |   |
| Commitments and Contingencies                                           |   |          |    |   |             |   |   |   |
|                                                                    |   |          |    |   |             |   |   |   |
| Shareholders’ Equity                                              |   |          |    |   |             |   |   |   |
| Common stock, $.01 par value                                            |   |          |    |   |             |   |   |   |
| Authorized - 7,000,000 shares                                           |   |          |    |   |             |   |   |   |
| Issued and outstanding 2011 - 1,553,525 shares, 2010 - 1,553,525 shares |   |          | 15      |   |             |   | 15 |   |
| Additional paid-in-capital                                              |   |          | 10,988  |   |             |   | 10,987 |   |
| Retained earnings                                                       |   |          | 24,579  |   |             |   | 24,374 |   |
| Accumulated other comprehensive income                                  |   |          | 223     |   |             |   | 201 |   |
| Total shareholders’ equity                                        |   |          | 35,805  |   |             |   | 35,577 |   |
|                                                                    |   |          |    |   |             |   |   |   |
| Total liabilities and shareholders’ equity                        |   | $             | 363,777 |   |             | $      | 371,847 |   |

----

|                                                |   | Three months endedMarch 31, |   |
|-----------------------------------------------------|--------|-----------------------------|--------|
|                                                |   | 2011                        |   |   | 2010 |   |
| Interest and Dividend Income                        |   |                        |   |   |   |   |
| Loans                                               |   | $                           | 4,358  |   |   | $ | 4,544 |   |
| Securities                                          |   |                        |   |   |   |   |   |   |
| Taxable                                             |   |                        | 68     |   |   |   | 59 |   |
| Tax-exempt                                          |   |                        | 45     |   |   |   | 62 |   |
| Other                                               |   |                        | 4      |   |   |   | 6 |   |
| Total interest and dividend income                  |   |                        | 4,475  |   |   |   | 4,671 |   |
| Interest Expense                                    |   |                        |   |   |   |   |   |   |
| Deposits                                            |   |                        | 990    |   |   |   | 1,271 |   |
| Borrowings                                          |   |                        | 121    |   |   |   | 452 |   |
| Total interest expense                              |   |                        | 1,111  |   |   |   | 1,723 |   |
| Net Interest Income                                 |   |                        | 3,364  |   |   |   | 2,948 |   |
|                                                |   |                        |   |   |   |   |   |   |
| Provision for Loan Losses                           |   |                        | 1,176  |   |   |   | 434 |   |
| Net Interest Income After Provision for Loan Losses |   |                        | 2,188  |   |   |   | 2,514 |   |
|                                                |   |                        |   |   |   |   |   |   |
| Non-interest Income                                 |   |                        |   |   |   |   |   |   |
| Deposit account service charges and fees            |   |                        | 292    |   |   |   | 367 |   |
| Net gains on loan sales                             |   |                        | 164    |   |   |   | 85 |   |
| Loss on other real estate owned                     |   |                        | (24    | ) |   |   | (33 | ) |
| Other                                               |   |                        | 260    |   |   |   | 275 |   |
| Total non-interest income                           |   |                        | 692    |   |   |   | 694 |   |
|                                                |   |                        |   |   |   |   |   |   |
| Non-Interest Expense                                |   |                        |   |   |   |   |   |   |
| Salaries and employee benefits                      |   |                        | 1,410  |   |   |   | 1,292 |   |
| Net occupancy and equipment expense                 |   |                        | 329    |   |   |   | 339 |   |
| Computer service                                    |   |                        | 142    |   |   |   | 127 |   |
| Advertising                                         |   |                        | 58     |   |   |   | 56 |   |
| FDIC insurance premiums                             |   |                        | 184    |   |   |   | 159 |   |
| Other                                               |   |                        | 466    |   |   |   | 440 |   |
| Total non-interest expense                          |   |                        | 2,589  |   |   |   | 2,413 |   |
|                                                |   |                        |   |   |   |   |   |   |
| Income  Before Income Taxes               |   |                        | 291    |   |   |   | 795 |   |
| Provision for Income Taxes                          |   |                        | 86     |   |   |   | 263 |   |
| Net Income                                          |   | $                           | 205    |   |   | $ | 532 |   |
| Basic Earnings Per Share                            |   | $                           | 0.13   |   |   | $ | 0.34 |   |
| Diluted Earnings Per Share                          |   | $                           | 0.13   |   |   | $ | 0.34 |   |
|                                                |   |                        |   |   |   |   |   |   |
| Dividends Declared Per Share                        |   | $                           | 0.00   |   |   | $ | 0.125 |   |
|                                                |   |                        |   |   |   |   |   |   |

----

|                                                                             |   | Common Stock  |   |   | Additional Paid-In Capital |   |   | Retained Earnings |         |   | Accumulated Other Comprehensive Income |   |   | Total  |   |
|----------------------------------------------------------------------------------|--------|---------------|--------|--------|----------------------------|--------|--------|-------------------|--------------|--------|----------------------------------------|--------|--------|--------|--------|
|                                                                             |   |          |   |   |                       |   |   |              |         |   |                                   |   |   |   |   |
| Balance, January 1, 2010                                                         |   | $             | 15     |   |                       | $      | 10,985 |              |         | $      | 22,646                                 |   |   | $      | 238    |   |   | $ | 33,884 |   |
| Comprehensive income                                                             |   |          |   |   |                       |   |   |              |         |   |                                   |   |   |   |   |   |   |   |   |   |
| Net income                                                                       |   |          |   |   |                       |   |   |              |         |   | 532                                    |   |   |   |   |   |   |   | 532 |   |
| Change in unrealized appreciation on available-for-sale securities, net of taxes |   |          |   |   |                       |   |   |              |         |   |                                   |   |   |   | (2     | ) |   |   | (2 | ) |
| Total comprehensive income                                                       |   |          |   |   |                       |   |   |              |         |   |                                   |   |   |   |   |   |   |   | 530 |   |
| Dividends on common stock, $0.125 per share                                      |   |          |   |   |                       |   |   |              |         |   | (195                                   | )      |   |   |   |   |   |   | (195 | ) |
| Share-based compensation expense                                                 |   |          |   |   |                       | 1      |   |              |    |   |                                   |   |   |   |   | 1 |   |
| Balance, March 31, 2010                                                          |   | $             | 15     |   |                       | $      | 10,986 |              |         | $      | 22,983                                 |   |   | $      | 236    |   |   | $ | 34,220 |   |
|                                                                             |   |          |   |   |                       |   |   |              |         |   |                                   |   |   |   |   |   |   |   |   |   |
|                                                                             |   |          |   |   |                       |   |   |              |         |   |                                   |   |   |   |   |   |   |   |   |   |
|                                                                             |   |          |   |   |                       |   |   |              |         |   |                                   |   |   |   |   |   |   |   |   |   |
| Balance, January 1, 2011                                                         |   | $             | 15     |   |                       | $      | 10,987 |              |         | $      | 24,374                                 |   |   | $      | 201    |   |   | $ | 35,577 |   |
| Comprehensive income                                                             |   |          |   |   |                       |   |   |              |         |   |                                   |   |   |   |   |   |   |   |   |   |
| Net income                                                                       |   |          |   |   |                       |   |   |              |         |   | 205                                    |   |   |   |   |   |   |   | 205 |   |
| Change in unrealized appreciation on available-for-sale securities, net of taxes |   |          |   |   |                       |   |   |              |         |   |                                   |   |   |   | 22     |   |   |   | 22 |   |
| Total comprehensive income                                                       |   |          |   |   |                       |   |   |              |         |   |                                   |   |   |   |   |   |   |   | 227 |   |
| Share-based compensation expense                                                 |   |     |   |   |                       | 1      |   |              |         |   |                                   |   |   |   |   | 1 |   |
| Balance, March 31, 2011                                                          |   | $             | 15     |   |                       | $      | 10,988 |              |         | $      | 24,579                                 |   |   | $      | 223    |   |   | $ | 35,805 |   |

----

|                                                                  |   | Three months endedMarch 31, |    |
|-----------------------------------------------------------------------|--------|-----------------------------|---------|
|                                                                  |   | 2011                        |    |   | 2010 |   |
| Operating Activities                                                  |   |                        |    |   |   |   |
| Net income                                                            |   | $                           | 205     |   |   | $ | 532 |   |
| Items not requiring (providing) cash                                  |   |                        |    |   |   |   |   |   |
| Depreciation                                                          |   |                        | 98      |   |   |   | 110 |   |
| Provision for loan losses                                             |   |                        | 1,176   |   |   |   | 434 |   |
| Amortization of premiums and discounts on securities                  |   |                        | 16      |   |   |   | 10 |   |
| Loss on sale of other real estate owned                               |   |                        | 24      |   |   |   | 33 |   |
| Gain on sale of loans                                                 |   |                        | (164    | ) |   |   | (74 | ) |
| Loans originated for sale                                             |   |                        | (10,211 | ) |   |   | (5,426 | ) |
| Proceeds on loans sold                                                |   |                        | 12,151  |   |   |   | 8,192 |   |
| Amortization of stock options                                         |   |                        | 1       |   |   |   | 1 |   |
| Changes in                                                            |   |                        |    |   |   |   |   |   |
| Interest receivable and other assets                                  |   |                        | 184     |   |   |   | 170 |   |
| Interest payable and other liabilities                                |   |                        | 217     |   |   |   | 230 |   |
| Net cash provided by operating activities                             |   |                        | 3,697   |   |   |   | 4,212 |   |
|                                                                  |   |                        |    |   |   |   |   |   |
| Investing Activities                                                  |   |                        |    |   |   |   |   |   |
| Purchases of available-for-sale securities                            |   |                        | (1,038  | ) |   |   | --- |   |
| Proceeds from maturities of available-for-sale securities             |   |                        | 870     |   |   |   | 353 |   |
| Net change in loans                                                   |   |                        | 4,004   |   |   |   | (3,759 | ) |
| Proceeds from sale of other real estate owned                         |   |                        | 165     |   |   |   | 205 |   |
| Purchase of premises and equipment                                    |   |                        | (81     | ) |   |   | (68 | ) |
| Net cash provided by (used in) investing activities                   |   |                        | 3,920   |   |   |   | (3,269 | ) |
|                                                                  |   |                        |    |   |   |   |   |   |
| Financing Activities                                                  |   |                        |    |   |   |   |   |   |
| Net change in demand deposits, money market, NOW and savings accounts |   |                        | (960    | ) |   |   | 10,575 |   |
| Net change in certificates of deposit                                 |   |                        | (5,569  | ) |   |   | 2,518 |   |
| Proceeds from Federal Home Loan Bank advances                         |   |                        | 4,000   |   |   |   | 8,000 |   |
| Repayment of Federal Home Loan Bank advances                          |   |                        | (6,000  | ) |   |   | (21,000 | ) |
| Dividends paid                                                        |   |                        | ---     |   |   |   | (195 | ) |
| Net cash used in financing activities                                 |   |                        | (8,529  | ) |   |   | (102 | ) |
|                                                                  |   |                        |    |   |   |   |   |   |
| Increase (Decrease) in Cash and Cash Equivalents                      |   |                        | (912    | ) |   |   | 841 |   |
| Cash and Cash Equivalents, Beginning of Period                        |   |                        | 13,573  |   |   |   | 12,901 |   |
| Cash and Cash Equivalents, End of Period                              |   | $                           | 12,661  |   |   | $ | 13,742 |   |
|                                                                  |   |                        |    |   |   |   |   |   |
| Supplemental Cash Flows Information                                   |   |                        |    |   |   |   |   |   |
| Interest paid                                                         |   | $                           | 1,109   |   |   | $ | 1,723 |   |
| Income taxes paid                                                     |   |                        | 400     |   |   |   | 140 |   |
|                                                                  |   |                        |    |   |   |   |   |   |
| Supplemental Non-Cash Disclosures                                     |   |                        |    |   |   |   |   |   |
| Capitalization of mortgage servicing rights                           |   |                        | 15      |   |   |   | 11 |   |
| Loans transferred to other real estate owned                          |   |                        | ---     |   |   |   | 274 |   |

----

----

|                                              |   | Three months endedMarch 31, |      |
|---------------------------------------------------|--------|-----------------------------|-----------|
|                                              |   | 2011                        |      |   | 2010 |   |
|                                              |   |                        |      |   |   |   |
| Weighted average shares outstanding               |   |                        | 1,553,525 |   |   |   | 1,553,525 |   |
| Stock options                                     |   |                        | 2,715     |   |   |   | 0 |   |
| Shares used to compute diluted earnings per share |   |                        | 1,556,240 |   |   |   | 1,554,059 |   |
| Basic earnings per share                          |   | $                           | 0.13      |   |   | $ | 0.34 |   |
| Diluted earnings per share                        |   | $                           | 0.13      |   |   | $ | 0.34 |   |

|                                                             |   | Amortized Cost |   |   | Gross Unrealized Gains |   |      | Gross Unrealized Losses |   |   | Approximate Fair Value |   |
|------------------------------------------------------------------|--------|----------------|--------|--------|------------------------|--------|-----------|-------------------------|--------|--------|------------------------|--------|
|                                                             |   |           |   |   | (in Thousands)         |   |      |                    |   |
| Available-for-sale Securities:                                   |   |           |   |   |                   |   |      |                    |   |   |                   |   |
| March 31, 2011:                                                  |   |           |   |   |                   |   |      |                    |   |   |                   |   |
| U.S. Government agencies                                         |   | $              | 3,107  |   |                   | $      | 18        |                    |   | $      | (4                     | )      |   | $ | 3,121 |   |
| Mortgage-backed securities – government sponsored entities |   |           | 2,441  |   |                   |   | 165       |                    |   |   | ---                    |   |   |   | 2,606 |   |
| State and political subdivisions                                 |   |           | 6,075  |   |                   |   |  194 |                    |   |   |  (2               | )      |   |   |  6,267 |   |
|                                                             |   | $              | 11,623 |   |                   | $      | 377       |                    |   | $      | (6                     | )      |   | $ | 11,994 |   |
|                                                             |   |           |   |   |                   |   |      |                    |   |   |                   |   |   |   |   |   |
| December 31, 2010:                                               |   |           |   |   |                   |   |      |                    |   |   |                   |   |   |   |   |   |
| U.S. Government sponsored agencies                               |   | $              | 2,081  |   |                   | $      | 19        |                    |   | $      | (4                     | )      |   | $ | 2,096 |   |
| Mortgage-backed securities – government sponsored agencies |   |           | 2,529  |   |                   |   | 145       |                    |   |   | ---                    |   |   |   | 2,674 |   |
| State and political subdivisions                                 |   |           | 6,860  |   |                   |   | 181       |                    |   |   | (6                     | )      |   |   | 7,035 |   |
|                                                             |   | $              | 11,470 |   |                   | $      | 345       |                    |   | $      | (10                    | )      |   | $ | 11,805 |   |

----

|   |                       |   | Available for Sale |        |
|--------|----------------------------|--------|--------------------|-------------|
|   |                       |   | Amortized Cost     |        |   | Fair Value |   |
|   |                       |   | March 31, 2011     |        |
|   |                       |   | (in thousands)     |        |
|   |                       |   |               |        |   |   |   |   |   |
|   | Within one year            |   | $                  | 1,582       |   |   | $ | 1,617 |   |
|   | One to five years          |   |               | 4,760       |   |   |   | 4,814 |   |
|   | Five to ten years          |   |               | 2,360       |   |   |   | 2,464 |   |
|   | After ten years            |   |               | 480         |   |   |   | 493 |   |
|   |                       |   |               | 9,182       |   |   |   | 9,388 |   |
|   |                       |   |               |        |   |   |   |   |   |
|   | Mortgage-backed securities |   |               |  2,441 |   |   |   | 2,606 |   |
|   |                       |   |               |        |   |   |   |   |   |
|   | Totals                     |   | $                  | 11,623      |   |   | $ | 11,994 |   |

|                                  |   | Less Than 12 Months |   |   | 12 Months or More |   |   | Total     |   |
|---------------------------------------|--------|---------------------|--------|--------|-------------------|--------|--------|-----------|--------|
| Description of Securities             |   | FairValue           |   |   | UnrealizedLosses  |   |   | FairValue |   |   | UnrealizedLosses |   |   | FairValue |   |   | UnrealizedLosses |   |
| March 31, 2011                        |   |                |   |   |              |   |   |      |   |   |   |   |   |   |   |   |   |   |
| U.S. Government sponsored agencies    |   | $                   | 1,565  |   |              | $      | 4      |      |   | $ | --- |   |   | $ | --- |   |   | $ | 1,565 |   |   | $ | 4 |   |
| State and political subdivisions      |   |                | 448    |   |              |   | 2      |      |   |   | --- |   |   |   | --- |   |   |   | 448 |   |   |   | 2 |   |
| Total temporarily impaired securities |   | $                   | 2,013  |   |              | $      | 6      |      |   | $ | --- |   |   | $ | --- |   |   | $ | 2,013 |   |   | $ | 6 |   |
| December 31, 2010                     |   |                |   |   |              |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. Government sponsored agencies    |   | $                   | 1,042  |   |              | $      | 4      |      |   | $ | --- |   |   | $ | --- |   |   | $ | 1,042 |   |   | $ | 4 |   |
| State and political subdivisions      |   |                | 874    |   |              |   | 6      |      |   |   | --- |   |   |   | --- |   |   |   | 874 |   |   |   | 6 |   |
| Total temporarily impaired securities |   | $                   | 1,916  |   |              | $      | 10     |      |   | $ | --- |   |   | $ | --- |   |   | $ | 1,916 |   |   | $ | 10 |   |

----

|                                           |   | March 31,2011 |    |   | December 31,2010 |   |
|------------------------------------------------|--------|---------------|---------|--------|------------------|--------|
| Real Estate                                    |   |          |    |   |             |   |
| One-to-four family residential                 |   | $             | 122,672 |   |             | $      | 122,856 |   |
| Multi-family residential                       |   |          | 50,617  |   |             |   | 53,458 |   |
| Commercial real estate                         |   |          | 91,964  |   |             |   | 90,395 |   |
| Construction and land development              |   |          | 30,228  |   |             |   | 30,467 |   |
| Commercial                                     |   |          | 14,150  |   |             |   | 16,332 |   |
| Consumer and other                             |   |          | 1,167   |   |             |   | 1,208 |   |
| Home equity lines of credit                    |   |          | 16,652  |   |             |   | 17,043 |   |
| Total loans                                    |   |          | 327,450 |   |             |   | 331,759 |   |
|                                           |   |          |    |   |             |   |   |   |
| Less                                           |   |          |    |   |             |   |   |   |
| Net deferred loan fees, premiums and discounts |   |          | (489    | )      |             |   | (499 | ) |
| Undisbursed portion of loans                   |   |          | (4,784  | )      |             |   | (5,107 | ) |
| Allowance for loan losses                      |   |          | (6,547  | )      |             |   | (5,343 | ) |
| Net loans                                      |   | $             | 315,630 |   |             | $      | 320,810 |   |

|                                                                    |   | 2011   |   |   | 2010   |   |
|-------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|
| Balance, beginning of year                                              |   | $      | 5,343  |   |   | $      | 3,737 |   |
| Provision charged to expense                                            |   |   | 1,176  |   |   |   | 2,759 |   |
| Losses charged off, net of recoveries of $38 for 2011 and $109 for 2010 |   |   | 28     |   |   |   | (1,153 | ) |
| Balance, end of year                                                    |   | $      | 6,547  |   |   | $      | 5,343 |   |

|                         |   | Allowance for Loan Losses and Recorded Investment in Loans for the Quarter Ended March 31, 2011 |   |
|------------------------------|--------|-------------------------------------------------------------------------------------------------|--------|
| March 31, 2011               |   | Commercial                                                                                      |   | OwnerOccupied1-4 |   | Non-ownerOccupied1-4 |   | Multi-family |   | CommercialReal Estate |   | Construction |   | Land |   | Consumer and Home Equity |   | Total |   |
| Allowance for losses         |   |                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Beginning balance            |   | $                                                                                               | 565    |   | $ | 242 |   | $ | 773 |   | $ | 1,138 |   | $ | 2,061 |   | $ | --- |   | $ | 480 |   | 84 |   | 5,343 |   |
| Provision charged to expense |   |                                                                                            | 162    |   |   | 231 |   |   | 690 |   |   | 17 |   |   | 33 |   |   | 78 |   |   | (37 | ) | 2 |   | 1,176 |   |
| Losses charged off           |   |                                                                                            | ---    |   |   | --- |   |   | --- |   |   | --- |   |   | --- |   |   | --- |   |   | --- |   | (9 | ) | (9 | ) |
| Recoveries                   |   |                                                                                            | ---    |   |   | 22 |   |   | 8 |   |   | --- |   |   | --- |   |   | --- |   |   | 7 |   | --- |   | 37 |   |
| Ending balance               |   |                                                                                            | 727    |   |   | 495 |   |   | 1,471 |   |   | 1,155 |   |   | 2,094 |   |   | 78 |   |   | 450 |   | 77 |   | 6,547 |   |
| ALL individually evaluated   |   |                                                                                            | 184    |   |   | 57 |   |   | 203 |   |   | 961 |   |   | 1,260 |   |   | --- |   |   | 184 |   | 2 |   | 2,851 |   |
| ALL collectively evaluated   |   |                                                                                            | 711    |   |   | 536 |   |   | 1,423 |   |   | 60 |   |   | 654 |   |   | 112 |   |   | 99 |   | 101 |   | 3,696 |   |
| Loans individually evaluated |   |                                                                                            | 1,942  |   |   | 1,627 |   |   | 8,821 |   |   | 6,391 |   |   | 11,182 |   |   | --- |   |   | 4,485 |   | 217 |   | 34,665 |   |
| Loans collectively evaluated |   |                                                                                            | 12,208 |   |   | 56,765 |   |   | 55,459 |   |   | 44,226 |   |   | 80,782 |   |   | 16,338 |   |   | 9,405 |   | 17,602 |   | 292,785 |   |

----

| Allowance for Loan Losses and Recorded Investment in Loans for the Year Ended December 31, 2010 |   |
|-------------------------------------------------------------------------------------------------|--------|
| December 31, 2010                                                                               |   | Commercial |   | OwnerOccupied1-4 |   | Non-ownerOccupied1-4 |   | Multi-family |   | CommercialReal Estate |   | Construction |   | Land |   | Consumer and Home Equity |   | Total |   |
| Allowance for losses                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Beginning balance                                                                               |   | $ | 103 |   | $ | 402 |   | $ | 1,214 |   | $ | 344 |   | $ | 1,095 |   | $ | 38 |   | $ | 518 |   | 23 |   | 3,737 |   |
| Provision charged to expense                                                                    |   |   | 527 |   |   | (61 | ) |   | 3 |   |   | 794 |   |   | 1,140 |   |   | (46 | ) |   | 337 |   | 65 |   | 2,759 |   |
| Losses charged off                                                                              |   |   | 68 |   |   | 117 |   |   | 579 |   |   | --- |   |   | 211 |   |   | --- |   |   | 402 |   | 5 |   | 1,382 |   |
| Recoveries                                                                                      |   |   | 3 |   |   | 18 |   |   | 135 |   |   | --- |   |   | 37 |   |   | 8 |   |   | 27 |   | 1 |   | 229 |   |
| Ending balance                                                                                  |   |   | 565 |   |   | 242 |   |   | 773 |   |   | 1,138 |   |   | 2,061 |   |   | --- |   |   | 480 |   | 84 |   | 5,343 |   |
| ALL individually evaluated                                                                      |   |   | 285 |   |   | 122 |   |   | 390 |   |   | 574 |   |   | 1,039 |   |   | --- |   |   | 242 |   | 42 |   | 2,694 |   |
| ALL collectively evaluated                                                                      |   |   | 280 |   |   | 120 |   |   | 383 |   |   | 564 |   |   | 1,022 |   |   | --- |   |   | 238 |   | 42 |   | 2,649 |   |
| Loans individually evaluated                                                                    |   |   | 4,334 |   |   | 3,365 |   |   | 16,529 |   |   | 11,491 |   |   | 21,828 |   |   | --- |   |   | 6,865 |   | 279 |   | 64,691 |   |
| Loans collectively evaluated                                                                    |   |   | 11,998 |   |   | 56,941 |   |   | 46,021 |   |   | 41,967 |   |   | 68,567 |   |   | 15,957 |   |   | 7,645 |   | 17,972 |   | 267,068 |   |

----

----

| Credit Rating       |   | Commercial |   | OwnerOccupied1-4 |   | Non-ownerOccupied1-4 |   | Multi-Family |   | CommercialReal Estate |   | Construction |   | Land   |   | ConsumerandHomeEquity |   |   Total |   |
|---------------------|--------|------------|--------|------------------|--------|----------------------|--------|--------------|--------|-----------------------|--------|--------------|--------|--------|--------|-----------------------|--------|-------------------|--------|
|                |   |       |   |             |   |                 |   |         |   |                  |   |         |   |   |   |                  |   |              |   |
| 1- Superior         |   | $          | 42     |             | $      | 3,278                |   | $            | 121    |                  | $      | ---          |   | $      | 183    |                  | $      | ---               |   | $ | 174 |   | $ | 1,464 |   | $ | 5,262 |   |
| 2 - Good            |   |       | 2,514  |             |   | 22,065               |   |         | 5,406  |                  |   | 8,064        |   |   | 10,523 |                  |   | 2,906             |   |   | 904 |   |   | 10,633 |   |   | 63,015 |   |
| 3 - Pass Low risk   |   |       | 4,086  |             |   | 22,999               |   |         | 15,107 |                  |   | 25,485       |   |   | 31,862 |                  |   | 9,408             |   |   | 711 |   |   | 4,404 |   |   | 114,062 |   |
| 4 - Pass            |   |       | 5,042  |             |   | 6,907                |   |         | 28,687 |                  |   | 6,062        |   |   | 26,465 |                  |   | 4,025             |   |   | 2,898 |   |   | 1,027 |   |   | 81,113 |   |
| 4W - Watch          |   |       | 132    |             |   | 1,301                |   |         | 4,278  |                  |   | 3,900        |   |   | 6,635  |                  |   | ---               |   |   | 1,200 |   |   | 74 |   |   | 17,520 |   |
| 5 - Special mention |   |       | 392    |             |   | 214                  |   |         | 1,860  |                  |   | 715          |   |   | 5,114  |                  |   | ---               |   |   | 3,518 |   |   | --- |   |   | 11,813 |   |
| 6 - Substandard     |   |       | 1,942  |             |   | 1,628                |   |         | 8,821  |                  |   | 6,391        |   |   | 11,182 |                  |   | ---               |   |   | 4,484 |   |   | 217 |   |   | 34,665 |   |
| 7 - Doubtful        |   |       | ---    |             |   | ---                  |   |         | ---    |                  |   | ---          |   |   | ---    |                  |   | ---               |   |   | --- |   |   | --- |   |   | --- |   |
| 8 - Loss            |   |       | ---    |             |   | ---                  |   |         | ---    |                  |   | ---          |   |   | ---    |                  |   | ---               |   |   | --- |   |   | --- |   |   | --- |   |
| Total               |   | $          | 14,150 |             | $      | 58,392               |   | $            | 64,280 |                  | $      | 50,617       |   | $      | 91,964 |                  | $      | 16,339            |   | $ | 13,889 |   | $ | 17,819 |   | $ | 327,450 |   |

| Credit Rating       |   | Commercial |   | OwnerOccupied1-4 |   | Non-ownerOccupied1-4 |   | Multi-Family |   | CommercialReal Estate |   | Construction |   | Land   |   | ConsumerandHomeEquity |   |   Total |   |
|---------------------|--------|------------|--------|------------------|--------|----------------------|--------|--------------|--------|-----------------------|--------|--------------|--------|--------|--------|-----------------------|--------|-------------------|--------|
|                |   |       |   |             |   |                 |   |         |   |                  |   |         |   |   |   |                  |   |              |   |
| 1- Superior         |   | $          | 42     |             | $      | 3,364                |   | $            | 160    |                  | $      | 112          |   | $      | 207    |                  | $      | ---               |   | $ | 218 |   | $ | 1,458 |   | $ | 5,565 |   |
| 2 - Good            |   |       | 3,227  |             |   | 20,113               |   |         | 5,353  |                  |   | 8,248        |   |   | 10,690 |                  |   | 3,073             |   |   | 953 |   |   | 11,079 |   |   | 63,736 |   |
| 3 - Pass Low risk   |   |       | 3,767  |             |   | 26,149               |   |         | 15,514 |                  |   | 26,040       |   |   | 31,532 |                  |   | 8,843             |   |   | 1,150 |   |   | 4,404 |   |   | 117,399 |   |
| 4 - Pass            |   |       | 4,960  |             |   | 7,113                |   |         | 25,016 |                  |   | 7,567        |   |   | 26,414 |                  |   | 4,040             |   |   | 5,325 |   |   | 930 |   |   | 81,364 |   |
| 4W - Watch          |   |       | 172    |             |   | 1,351                |   |         | 5,591  |                  |   | 4,353        |   |   | 8,331  |                  |   | ---               |   |   | 2,483 |   |   | 116 |   |   | 22,398 |   |
| 5 - Special mention |   |       | 3,899  |             |   | 462                  |   |         | 5,535  |                  |   | 2,478        |   |   | 4,799  |                  |   | ---               |   |   | --- |   |   | 97 |   |   | 17,269 |   |
| 6 - Substandard     |   |       | 265    |             |   | 1,753                |   |         | 5,382  |                  |   | 4,660        |   |   | 8,421  |                  |   | ---               |   |   | 4,382 |   |   | 164 |   |   | 25,027 |   |
| 7 - Doubtful        |   |       | ---    |             |   | ---                  |   |         | ---    |                  |   | ---          |   |   | ---    |                  |   | ---               |   |   | --- |   |   | --- |   |   | --- |   |
| 8 - Loss            |   |       | ---    |             |   | ---                  |   |         | ---    |                  |   | ---          |   |   | ---    |                  |   | ---               |   |   | --- |   |   | --- |   |   | --- |   |
| Total               |   | $          | 16,332 |             | $      | 60,306               |   | $            | 62,550 |                  | $      | 53,458       |   | $      | 90,395 |                  | $      | 15,957            |   | $ | 14,510 |   | $ | 18,251 |   | $ | 331,759 |   |

----

|                     |   | Loan Portfolio Aging Analysis as of March 31, 2011 |   |
|--------------------------|--------|----------------------------------------------------|--------|
|                     |   |                                               |   |
|                     |   | 30-59 Days                                         |   |   | 60-89 Days |   |   | Over 90 Days |   |   | Total Past Due |   |   | Current |   |   | Total Loans |   |   | MemoUnder 90 Daysand Not Accruing |   |   | MemoTotal 90 Daysand Accruing |   |
|                     |   |                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial               |   | $                                                  | 105    |   |   | $ | --- |   |   | $ | 247 |   |   | $ | 352 |   |   | $ | 13,798 |   |   | $ | 14,150 |   |   | $ | --- |   |   | $ | --- |   |
| Owner occupied 1-4       |   |                                               | 433    |   |   |   | 129 |   |   |   | 487 |   |   |   | 1,049 |   |   |   | 57,344 |   |   |   | 58,393 |   |   |   | 1,130 |   |   |   | --- |   |
| Non owner occupied 1-4   |   |                                               | 1,472  |   |   |   | 794 |   |   |   | 2,438 |   |   |   | 4,704 |   |   |   | 59,576 |   |   |   | 64,280 |   |   |   | 2,818 |   |   |   | --- |   |
| Multi-family             |   |                                               | ---    |   |   |   | --- |   |   |   | 2,290 |   |   |   | 2,290 |   |   |   | 48,327 |   |   |   | 50,617 |   |   |   | 559 |   |   |   | --- |   |
| Commercial Real Estate   |   |                                               | 1,823  |   |   |   | 176 |   |   |   | 5,948 |   |   |   | 7,947 |   |   |   | 84,017 |   |   |   | 91,964 |   |   |   | 245 |   |   |   | --- |   |
| Construction             |   |                                               | ---    |   |   |   | --- |   |   |   | --- |   |   |   | --- |   |   |   | 16,338 |   |   |   | 16,338 |   |   |   | --- |   |   |   | --- |   |
| Land                     |   |                                               | 159    |   |   |   | --- |   |   |   | 1,022 |   |   |   | 1,181 |   |   |   | 12,708 |   |   |   | 13,889 |   |   |   | 1,324 |   |   |   | --- |   |
| Consumer and home equity |   |                                               | ---    |   |   |   | --- |   |   |   | 159 |   |   |   | 159 |   |   |   | 17,660 |   |   |   | 17,819 |   |   |   | 90 |   |   |   | --- |   |
| Total                    |   | $                                                  | 3,992  |   |   | $ | 1,099 |   |   | $ | 12,591 |   |   | $ | 17,681 |   |   | $ | 309,768 |   |   | $ | 327,450 |   |   | $ | 6,166 |   |   | $ | --- |   |

|                     |   | Loan Portfolio Aging Analysis as of December 31, 2010 |   |
|--------------------------|--------|-------------------------------------------------------|--------|
|                     |   |                                                  |   |
|                     |   | 30-59 Days                                            |   |   | 60-89 Days |   |   | Over 90 Days |   |   | Total Past Due |   |   | Current |   |   | Total Loans |   |   | MemoUnder 90 Daysand Not Accruing |   |   | MemoTotal 90 Daysand Accruing |   |
|                     |   |                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial               |   | $                                                     | 60     |   |   | $ | --- |   |   | $ | 251 |   |   | $ | 311 |   |   | $ | 16,021 |   |   | $ | 16,332 |   |   | $ | --- |   |   | $ | --- |   |
| Owner occupied 1-4       |   |                                                  | 139    |   |   |   | 539 |   |   |   | 515 |   |   |   | 1,193 |   |   |   | 59,113 |   |   |   | 60,306 |   |   |   | 715 |   |   |   | --- |   |
| Non owner occupied 1-4   |   |                                                  | ---    |   |   |   | 176 |   |   |   | 3,293 |   |   |   | 3,469 |   |   |   | 59,080 |   |   |   | 62,550 |   |   |   | 1,918 |   |   |   | 48 |   |
| Multi-family             |   |                                                  | ---    |   |   |   | --- |   |   |   | 2,289 |   |   |   | 2,289 |   |   |   | 51,168 |   |   |   | 53,458 |   |   |   | 559 |   |   |   | --- |   |
| Commercial Real Estate   |   |                                                  | 338    |   |   |   | 55 |   |   |   | 5,639 |   |   |   | 6,032 |   |   |   | 84,363 |   |   |   | 90,395 |   |   |   | 213 |   |   |   | 628 |   |
| Construction             |   |                                                  | ---    |   |   |   | --- |   |   |   | --- |   |   |   | --- |   |   |   | 15,957 |   |   |   | 15,957 |   |   |   | --- |   |   |   | --- |   |
| Land                     |   |                                                  | 16     |   |   |   | --- |   |   |   | 1,022 |   |   |   | 1,039 |   |   |   | 12,472 |   |   |   | 14,510 |   |   |   | 1,468 |   |   |   | --- |   |
| Consumer and home equity |   |                                                  | 5      |   |   |   | 39 |   |   |   | 134 |   |   |   | 178 |   |   |   | 18,073 |   |   |   | 18,251 |   |   |   | 30 |   |   |   | --- |   |
| Total                    |   | $                                                     | 559    |   |   | $ | 809 |   |   | $ | 13,143 |   |   | $ | 14,511 |   |   | $ | 317,248 |   |   | $ | 331,759 |   |   | $ | 4,903 |   |   | $ | 676 |   |

----

| Impaired Loans as of and for the Quarter Ended March 31, 2011  |   |
|---------------------------------------------------------------------|--------|
|                                                                |   | RecordedBalance |   |   | UnpaidPrincipalBalance |   |   | SpecificAllowance |   |   | AverageImpairedLoans |   |   | InterestIncomeRecognized |   |
| Loans without specific valuation allowance                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Residential Real Estate                                             |   | $ | 13,088 |   |   | $ | 13,088 |   |   | $ | --- |   |   | $ | 9,967 |   |   | $ | 99 |   |
| Commercial Real Estate                                              |   |   | 7,584 |   |   |   | 7,959 |   |   |   | --- |   |   |   | 6,817 |   |   |   | 54 |   |
| Non real estate                                                     |   |   | 1,704 |   |   |   | 1,704 |   |   |   | --- |   |   |   | 865 |   |   |   | 9 |   |
|                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans with a specific valuation allowance                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Residential Real Estate                                             |   |   | 1,862 |   |   |   | 1,852 |   |   |   | 303 |   |   |   | 1,981 |   |   |   | 8 |   |
| Commercial Real Estate                                              |   |   | 10,178 |   |   |   | 10,178 |   |   |   | 2,364 |   |   |   | 8,085 |   |   |   | 38 |   |
| Non real estate                                                     |   |   | 249 |   |   |   | 249 |   |   |   | 184 |   |   |   | 250 |   |   |   | 1 |   |
|                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Residential Real Estate                                             |   |   | 14,950 |   |   |   | 14,940 |   |   |   | 303 |   |   |   | 11,948 |   |   |   | 107 |   |
| Commercial Real Estate                                              |   |   | 17,762 |   |   |   | 18,137 |   |   |   | 2,364 |   |   |   | 14,902 |   |   |   | 92 |   |
| Non real estate                                                     |   |   | 1,953 |   |   |   | 1,953 |   |   |   | 184 |   |   |   | 1,115 |   |   |   | 10 |   |

| Impaired Loans as of and for the Year Ended December 31, 2010  |   |
|---------------------------------------------------------------------|--------|
|                                                                |   | RecordedBalance |   |   | UnpaidPrincipalBalance |   |   | SpecificAllowance |   |   | AverageImpairedLoans |   |   | InterestIncomeRecognized |   |
| Loans without specific valuation allowance                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Residential Real Estate                                             |   | $ | 7,485 |   |   | $ | 6,385 |   |   | $ | --- |   |   | $ | 7,661 |   |   | $ | 391 |   |
| Commercial Real Estate                                              |   |   | 7,238 |   |   |   | 7,765 |   |   |   | --- |   |   |   | 6,765 |   |   |   | 343 |   |
| Non real estate                                                     |   |   | --- |   |   |   | --- |   |   |   | --- |   |   |   | 46 |   |   |   | 8 |   |
|                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans with a specific valuation allowance                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Residential Real Estate                                             |   |   | 1,128 |   |   |   | 1,128 |   |   |   | 70 |   |   |   | 818 |   |   |   | 21 |   |
| Commercial Real Estate                                              |   |   | 4,534 |   |   |   | 4,534 |   |   |   | 1,125 |   |   |   | 2,628 |   |   |   | 77 |   |
| Non real estate                                                     |   |   | 239 |   |   |   | 239 |   |   |   | 169 |   |   |   | 197 |   |   |   | 12 |   |
|                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Residential Real Estate                                             |   |   | 8,613 |   |   |   | 7,513 |   |   |   | 70 |   |   |   | 8,479 |   |   |   | 412 |   |
| Commercial Real Estate                                              |   |   | 11,772 |   |   |   | 12,299 |   |   |   | 1,125 |   |   |   | 9,393 |   |   |   | 420 |   |
| Non real estate                                                     |   |   | 239 |   |   |   | 239 |   |   |   | 169 |   |   |   | 243 |   |   |   | 12 |   |

----

|   | Loan Class               |   | March 31, 2011 |   |   | December 31, 2010 |   |
|--------|--------------------------|--------|----------------|--------|--------|-------------------|--------|
|   |                     |   |           |   |   |              |   |   |   |
|   | Commercial               |   | $              | 247    |   |              | $      | 251 |   |
|   | Owner occupied 1-4       |   |           | 1,617  |   |              |   | 1,230 |   |
|   | Non owner occupied 1-4   |   |           | 5,256  |   |              |   | 5,163 |   |
|   | Multi-family             |   |           | 2,848  |   |              |   | 2,848 |   |
|   | Commercial Real Estate   |   |           | 6,193  |   |              |   | 5,224 |   |
|   | Construction             |   |           | ---    |   |              |   | --- |   |
|   | Land                     |   |           | 2,347  |   |              |   | 2,490 |   |
|   | Consumer and home equity |   |           | 249    |   |              |   | 164 |   |
|   | Total                    |   | $              | 18,757 |   |              | $      | 17,370 |   |

|                                                 |           | March 31, |   |
|------------------------------------------------------|----------------|-----------|--------|
|                                                 |           | 2011      |   |   | 2010 |   |
|                                                 | (in Thousands) |
|                                                 |           |      |   |   |   |   |
| Net unrealized gain on securities available-for-sale |           | $         | 36     |   |   | $ | (3 | ) |
| Tax expense                                          |           |      | 14     |   |   |   | (1 | ) |
|                                                 |           |      |   |   |   |   |   |   |
| Other comprehensive income                           |           | $         | 22     |   |   | $ | (2 | ) |

----

|   | Level 1 | Quoted prices in active markets for identical assets or liabilities |
|--------|---------|---------------------------------------------------------------------|

|   | Level 2 | Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                               |   |       |   |   | Fair Value Measurements Using                                 |   |
|------------------------------------|--------|------------|--------|--------|---------------------------------------------------------------|--------|
|                               |   | Fair Value |   |   | Quoted Prices in Active Markets for Identical Assets(Level 1) |   |   | Significant Other Observable Inputs(Level 2) |   |   | Significant Unobservable Inputs(Level 3) |   |
|                               |   |       |   |   |                                                          |   |   | (in Thousands) |   |   |   |   |
| Available-for-sale securities      |   |       |   |   |                                                          |   |   |   |   |   |   |   |
| March 31, 2011                     |   |       |   |   |                                                          |   |   |   |   |   |   |   |
| U.S. government sponsored agencies |   | $          | 3,121  |   |                                                          | $      | --- |   |   | $ | 3,121 |   |   | $ | --- |   |
| Mortgage-backed securities         |   |       | 2,606  |   |                                                          |   | --- |   |   |   | 2,606 |   |   |   | --- |   |
| State and political subdivisions   |   |       | 6,267  |   |                                                          |   | --- |   |   |   | 6,267 |   |   |   | --- |   |
| Totals                             |   |       | 11,994 |   |                                                          |   | --- |   |   |   | 11,994 |   |   |   | --- |   |
|                               |   |       |   |   |                                                          |   |   |   |   |   |   |   |   |   |   |   |
| Available-for-sale securities      |   |       |   |   |                                                          |   |   |   |   |   |   |   |   |   |   |   |
| December 31, 2010                  |   |       |   |   |                                                          |   |   |   |   |   |   |   |   |   |   |   |
| U.S. government agencies           |   | $          | 2,096  |   |                                                          | $      | --- |   |   | $ | 2,096 |   |   | $ | --- |   |
| Mortgage-backed securities         |   |       | 2,674  |   |                                                          |   | --- |   |   |   | 2,674 |   |   |   | --- |   |
| State and political subdivisions   |   |       | 7,035  |   |                                                          |   | --- |   |   |   | 7,035 |   |   |   | --- |   |
| Totals                             |   |       | 11,805 |   |                                                          |   | --- |   |   |   | 11,805 |   |   |   | --- |   |

----

|                            |   |           |   |   | Fair Value Measurements Using                                 |   |
|---------------------------------|--------|----------------|--------|--------|---------------------------------------------------------------|--------|
|                            |   | Fair Value     |   |   | Quoted Prices in Active Markets for Identical Assets(Level 1) |   |   | Significant Other Observable Inputs(Level 2) |   |   | Significant Unobservable Inputs(Level 3) |   |
|                            |   | (in Thousands) |   |
| Impaired loansMarch 31, 2011    |   | $              | 10,102 |   |                                                          | $      | --- |   |   | $ | --- |   |   | $ | 10,102 |   |
|                            |   |           |   |   |                                                          |   |   |   |   |   |   |   |   |   |   |   |
| Impaired loansDecember 31, 2010 |   | $              | 12,013 |   |                                                          | $      | --- |   |   | $ | --- |   |   | $ | 12,013 |   |

----

|                                    |   | March 31, 2011  |    |   | December 31, 2010 |   |
|-----------------------------------------|--------|-----------------|---------|--------|-------------------|--------|
|                                    |   | Carrying Amount |    |   | Fair Value        |   |   | Carrying Amount |   |   | Fair Value |   |
|                                    |   | (in Thousands)  |    |
| Financial assets                        |   |            |    |   |              |   |   |   |   |   |   |   |
| Cash and cash equivalents               |   | $               | 12,661  |   |              | $      | 12,661 |   |   | $ | 13,573 |   |   | $ | 13,573 |   |
| Available-for-sale securities           |   |            | 11,994  |   |              |   | 11,994 |   |   |   | 11,805 |   |   |   | 11,805 |   |
| Loans held for sale                     |   |            | 489     |   |              |   | 489 |   |   |   | 2,265 |   |   |   | 2,265 |   |
| Loans, net of allowance for loan losses |   |            | 315,630 |   |              |   | 325,175 |   |   |   | 320,810 |   |   |   | 331,913 |   |
| Federal Home Loan Bank stock            |   |            | 3,583   |   |              |   | 3,583 |   |   |   | 3,583 |   |   |   | 3,583 |   |
| Interest receivable                     |   |            | 1,314   |   |              |   | 1,314 |   |   |   | 1,421 |   |   |   | 1,421 |   |
| Financial liabilities                   |   |            |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Deposits                                |   |            | 304,929 |   |              |   | 308,806 |   |   |   | 311,458 |   |   |   | 316,112 |   |
| Federal Home Loan Bank advances         |   |            | 20,500  |   |              |   | 20,790 |   |   |   | 22,500 |   |   |   | 22,920 |   |
| Interest payable                        |   |            | 64      |   |              |   | 64 |   |   |   | 62 |   |   |   | 62 |   |

----

| Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations |
|----------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

----

----

|                                                                    |   | Three months endedMarch 31, |    |   | Three months endedMarch 31, |   |
|-------------------------------------------------------------------------|--------|-----------------------------|---------|--------|-----------------------------|--------|
|                                                                    |   | 2011                        |    |   | 2010                        |   |
|                                                                    |   | AverageOutstandingBalance   |    |   | InterestEarned/ Paid   |   |   | Yield/ Rate |   |   | AverageOutstanding Balance |   |   | InterestEarned/ Paid |   |   | Yield/ Rate |   |
|                                                                    |   | (Dollars in Thousands)      |    |
| Interest-Earning Assets:                                                |   |                        |    |   |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans receivable(1)                                                     |   | $                           | 319,425 |   |                        | $      | 4,358 |   |   |   | 5.46 | % |   | $ | 320,762 |   |   | $ | 4,544 |   |   |   | 5.67 | % |
| Other investments                                                       |   |                        | 20,453  |   |                        |   | 117 |   |   |   | 2.29 |   |   |   | 20,719 |   |   |   | 127 |   |   |   | 2.45 |   |
| Total interest-earning assets                                           |   |                        | 339,878 |   |                        |   | 4,475 |   |   |   | 5.27 |   |   |   | 341,481 |   |   |   | 4,671 |   |   |   | 5.47 |   |
|                                                                    |   |                        |    |   |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-Earning Liabilities                                            |   |                        |    |   |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Savings deposits                                                        |   | $                           | 25,673  |   |                        |   | 10 |   |   |   | 0.16 |   |   | $ | 25,816 |   |   |   | 39 |   |   |   | 0.60 |   |
| Demand and NOW deposits                                                 |   |                        | 119,369 |   |                        |   | 161 |   |   |   | 0.54 |   |   |   | 88,083 |   |   |   | 140 |   |   |   | 0.64 |   |
| Time deposits                                                           |   |                        | 162,779 |   |                        |   | 819 |   |   |   | 2.01 |   |   |   | 173,000 |   |   |   | 1,092 |   |   |   | 2.52 |   |
| Borrowings                                                              |   |                        | 20,167  |   |                        |   | 121 |   |   |   | 2.40 |   |   |   | 52,000 |   |   |   | 452 |   |   |   | 3.48 |   |
| Total interest-bearing liabilities                                      |   |                        | 327,988 |   |                        |   | 1,111 |   |   |   | 1.35 |   |   |   | 338,899 |   |   |   | 1,723 |   |   |   | 2.03 |   |
|                                                                    |   |                        |    |   |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                                     |   |                        |    |   |                        | $      | 3,364 |   |   |   |   |   |   |   |   |   |   | $ | 2,948 |   |   |   |   |   |
| Net interest rate spread                                                |   |                        |    |   |                        |   |   |   |   |   | 3.92 | % |   |   |   |   |   |   |   |   |   |   | 3.44 | % |
| Net earning assets                                                      |   | $                           | 11,890  |   |                        |   |   |   |   |   |   |   |   | $ | 2,582 |   |   |   |   |   |   |   |   |   |
| Net yield on average interest-earning assets                            |   |                        |    |   |                        |   |   |   |   |   | 3.96 | % |   |   |   |   |   |   |   |   |   |   | 3.45 | % |
| Average interest-earning assets to average interest-bearing liabilities |   |                        | 1.04    | x      |                        |   |   |   |   |   |   |   |   |   | 1.01 | x |   |   |   |   |   |   |   |   |

----

----

|                              |   | 03/31/11       |   |   | 12/31/10 |   |   | 03/31/10 |   |
|-----------------------------------|--------|----------------|--------|--------|----------|--------|--------|----------|--------|
|                              |   | (in Thousands) |   |
|                              |   |           |   |   |     |   |   |     |   |   |   |   |
| Loans delinquent 30-59 days       |   | $              | 2,632  |   |     | $      | 559    |     |   | $ | 427 |   |
| Loans delinquent 60-89 days       |   |           | 246    |   |     |   | 809    |     |   |   | 2,262 |   |
| Total delinquencies under 90 days |   |           | 2,878  |   |     |   | 1,368  |     |   |   | 2,689 |   |
| Accruing loans past due 90 days   |   |           | 0      |   |     |   | 676    |     |   |   | 1,927 |   |
| Non-accruing loans                |   |           | 18,757 |   |     |   | 17,370 |     |   |   | 15,226 |   |
| Total non-performing loans        |   |           | 18,757 |   |     |   | 18,046 |     |   |   | 17,153 |   |
| OREO                              |   |           | 1,024  |   |     |   | 1,214  |     |   |   | 1,785 |   |
| Total non-performing assets       |   | $              | 19,781 |   |     | $      | 19,260 |     |   | $ | 18,938 |   |

----

----

| (Dollars in Thousands) |   |
|------------------------|--------|
|                   |   | Three months ended March 31, |   |
|                   |   | 2011 |   |   | 2010 |   |
|                   |   |   |   |   |   |   |   |   |
| Balance at January 1   |   | $ | 5,343 |   |   | $ | 3,737 |   |
| Loans charged off      |   |   | (9 | ) |   |   | (50 | ) |
| Recoveries             |   |   | 37 |   |   |   | 0 |   |
| Provision              |   |   | 1,176 |   |   |   | 434 |   |
| Balance at March 31    |   | $ | 6,547 |   |   | $ | 4,121 |   |

----

----

----

|                                               |   | Actual                 |   |   | For Capital Adequacy Purposes |   |   | To Be Well Capitalized Under Prompt Corrective Action Provisions |   |
|----------------------------------------------------|--------|------------------------|--------|--------|-------------------------------|--------|--------|------------------------------------------------------------------|--------|
|                                               |   | Amount                 |   |   | Ratio                         |   |   | Amount                                                           |   |   | Ratio |   |   | Amount |   |   | Ratio |   |
| As of March 31, 2011                               |   | (Dollars in Thousands) |   |
| Total risk-based capital (to risk-weighted assets) |   | $                      | 38,637 |   |                          |   | 14.1   | %                                                                |   | $ | 21,874 |   |   |   | 8.0 | % |   | $ | 27,343 |   |   |   | 10.0 | % |
| Tier I capital (to risk-weighted assets)           |   |                   | 35,219 |   |                          |   | 12.9   |                                                             |   |   | 10,937 |   |   |   | 4.0 |   |   |   | 16,406 |   |   |   | 6.0 |   |
| Tier I capital (to adjusted total assets)          |   |                   | 35,219 |   |                          |   | 9.7    |                                                             |   |   | 10,897 |   |   |   | 3.0 |   |   |   | 18,162 |   |   |   | 5.0 |   |
| Tier I capital (to adjusted tangible assets)       |   |                   | 35,219 |   |                          |   | 9.7    |                                                             |   |   | 7,265 |   |   |   | 2.0 |   |   |   | N/A |   |   |   | N/A |   |
| Tangible capital (to adjusted tangible assets)     |   |                   | 35,219 |   |                          |   | 9.7    |                                                             |   |   | 5,448 |   |   |   | 1.5 |   |   |   | N/A |   |   |   | N/A |   |
|                                               |   |                   |   |   |                          |   |   |                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As of December 31, 2010                            |   |                   |   |   |                          |   |   |                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total risk-based capital (to risk-weighted assets) |   | $                      | 38,288 |   |                          |   | 13.8   | %                                                                |   | $ | 22,124 |   |   |   | 8.0 | % |   | $ | 27,655 |   |   |   | 10.0 | % |
| Tier I capital (to risk-weighted assets)           |   |                   | 34,975 |   |                          |   | 12.6   |                                                             |   |   | 11,062 |   |   |   | 4.0 |   |   |   | 16,593 |   |   |   | 6.0 |   |
| Tier I capital (to adjusted total assets)          |   |                   | 34,975 |   |                          |   | 9.4    |                                                             |   |   | 11,148 |   |   |   | 3.0 |   |   |   | 18,581 |   |   |   | 5.0 |   |
| Tier I capital (to adjusted tangible assets)       |   |                   | 34,975 |   |                          |   | 9.4    |                                                             |   |   | 7,432 |   |   |   | 2.0 |   |   |   | N/A |   |   |   | N/A |   |
| Tangible capital (to adjusted tangible assets)     |   |                   | 34,975 |   |                          |   | 9.4    |                                                             |   |   | 5,574 |   |   |   | 1.5 |   |   |   | N/A |   |   |   | N/A |   |

----

| ·   | the strength of the United States economy in general and the strength of the local economies in which we conduct our operations; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------|

| ·   | the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | financial market, monetary and interest rate fluctuations, particularly the relative relationship of short-term interest rates to long-term interest rates; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the timely development of and acceptance of new products and services of Lafayette Savings and the perceived overall value of these products and services by users, including the features, pricing and quality compared to competitors’ products and services; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the willingness of users to substitute competitors’ products and services for our products and services; |
|--------------------|----------------------------------------------------------------------------------------------------------------|

| ·   | the impact of changes in financial services laws and regulations (including laws concerning taxes, accounting standards, banking, securities and insurance); |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the impact of technological changes; |
|--------------------|--------------------------------------|

----

| ·   | acquisitions; |
|--------------------|---------------|

| ·   | changes in consumer spending and saving habits; and |
|--------------------|-----------------------------------------------------|

| ·   | our success at managing the risks involved in the foregoing. |
|--------------------|--------------------------------------------------------------|

| Item 3. | Quantitative and Qualitative Disclosures About Market Risk |
|---------|------------------------------------------------------------|

| Item 4. | Controls and Procedures. |
|---------|--------------------------|

| Item 1. | Legal Proceedings |
|---------|-------------------|

| Item 1A. | Risk Factors |
|----------|--------------|

----

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

| Issuer Purchases of Equity Securities  |   |
|---------------------------------------------|--------|
| Month of Purchase                           |   | Total Number of Shares Purchased1 |   |   | Average Price Paid per Share |   |   | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs2 |   |   | Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs2 |   |
|                                        |   |   |   |   |   |   |   |   |   |   |   |   |
| January 1 – January 31, 2011          |   |   | --- |   |   |   | --- |   |   |   | --- |   |   |   | 52,817 |   |
|                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| February 1 – February 28, 2011        |   |   | --- |   |   |   | --- |   |   |   | --- |   |   |   | 52,817 |   |
|                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| March 1 – March 31, 2011              |   |   | --- |   |   |   | --- |   |   |   | --- |   |   |   | 52,817 |   |
|                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                       |   |   | --- |   |   |   | --- |   |   |   | --- |   |   |   | 52,817 |   |

| Item 3. | Defaults Upon Senior Securities |
|---------|---------------------------------|

| Item 4. | [Removed and Reserved] |
|---------|------------------------|

| Item 5. | Other Information |
|---------|-------------------|

| Item 6. | Exhibits |
|---------|----------|

----

|                     | LSB FINANCIAL CORP. |
|--------------------------|---------------------|
|                     | (Registrant)        |
|                     |                |   |
|                     |                |   |
| Date:  May 16, 2011 | By:                 | /s/ Randolph F. Williams |
|                     |                | Randolph F. Williams, President |
|                     |                | (Principal Executive Officer) |
|                     |                |   |
|                     |                |   |
| Date:  May 16, 2011 | By:                 | /s/ Mary Jo David |
|                     |                | Mary Jo David, Treasurer |
|                     |                | (Principal Financial and Accounting Officer) |

----

|   RegulationS-K Exhibit Number |   | Document                                                 |
|-------------------------------------|--------|----------------------------------------------------------|
|                                |   |                                                     |
| 31.1                                |   | Rule 13(a)-14(a) Certification (Chief Executive Officer) |
| 31.2                                |   | Rule 13(a)-14(a) Certification (Chief Financial Officer) |
| 32                                  |   | Section 906 Certification                                |