##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PERSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2008
 OR
 o
    
    TRANSITION REPORT PERSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number: 0-51153
 FEDFIRST FINANCIAL CORPORATION
  United States
    
    25-1828028(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)Donner at Sixth Street, Monessen, Pennsylvania
    
    15062(Address of principal executive offices)
    
    (Zip Code)
 (724) 684-6800
 þ o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ




---



##### 



FORM 10-Q
 INDEX
 PagePART I  FINANCIAL INFORMATIONItem 1. Financial Statements
    
    
    1Consolidated Statements of Financial Condition at March 31, 2008 (Unaudited) and December 31, 2007
    
    
    1Consolidated Statements of Operations (Unaudited) for the Three Months Ended March 31, 2008 and 2007
    
    
    2Consolidated Statements of Changes in Stockholders Equity and
Comprehensive Income (Loss) for the Three Months Ended March 31, 2008 and 2007 (Unaudited)
    
    
    3Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2008 and 2007 (Unaudited)
    
    
    4Notes to the Unaudited Consolidated Financial Statements
    
    
    5Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    13Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    19Item 4. Controls and Procedures
    
    
    19PART II  OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    20Item 1A. Risk Factors
    
    
    20Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    20Item 3. Defaults Upon Senior Securities
    
    
    20Item 4. Submission of Matters to a Vote of Security Holders
    
    
    20Item 5. Other Information
    
    
    21Item 6. Exhibits
    
    
    21SIGNATURESEX-10.1EX-10.2EX-10.3EX-10.4EX-10.5EX-31.1EX-31.2EX-32.1EX-32.2




---



##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements.
 
 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
 March 31,
    
    December 31,2008
    
    2007(Dollars in thousands, except share data)
    
    (UNAUDITED)Assets:Cash and cash equivalents:Cash and due from banks
    
    $
    1,782
    
    
    $
    2,127Interest-earning deposits
    
    
    3,806
    
    
    
    3,425Total cash and cash equivalents
    
    
    5,588
    
    
    
    5,552Securities available-for-sale
    
    
    103,496
    
    
    
    89,073Loans, net
    
    
    193,183
    
    
    
    187,954Federal Home Loan Bank (FHLB) stock, at cost
    
    
    5,961
    
    
    
    5,076Accrued interest receivable  loans
    
    
    982
    
    
    
    966Accrued interest receivable  securities
    
    
    518
    
    
    
    651Premises and equipment, net
    
    
    2,898
    
    
    
    2,956Bank-owned life insurance
    
    
    7,605
    
    
    
    7,538Goodwill
    
    
    1,080
    
    
    
    1,080Real estate owned
    
    
    766
    
    
    
    1,119Other assets
    
    
    957
    
    
    
    366Deferred tax assets and tax credit carryforwards
    
    
    2,756
    
    
    
    2,942Total assets
    
    $
    325,790
    
    
    $
    305,273Liabilities and Stockholders Equity:Deposits:Noninterest-bearing
    
    
    10,832
    
    
    
    8,918Interest-bearing
    
    
    151,033
    
    
    
    146,640Total deposits
    
    
    161,865
    
    
    
    155,558Borrowings
    
    
    115,147
    
    
    
    101,074Advance payments by borrowers for taxes and insurance
    
    
    472
    
    
    
    477Accrued interest payable  deposits
    
    
    1,223
    
    
    
    1,116Accrued interest payable  borrowings
    
    
    491
    
    
    
    413Other liabilities
    
    
    3,110
    
    
    
    2,782Total liabilities
    
    
    282,308
    
    
    
    261,420Minority interest in subsidiary
    
    
    71
    
    
    
    80Stockholders equity:Preferred stock $0.01 par value; 10,000,000 shares authorized; none issued
    
    
    
    
    
    
    Common stock $0.01 par value; 20,000,000 shares authorized; 6,707,500 shares
issued and 6,479,100 and 6,518,200 shares outstanding
    
    
    67
    
    
    
    67Additional paid-in-capital
    
    
    29,165
    
    
    
    29,084Retained earnings  substantially restricted
    
    
    18,343
    
    
    
    18,520Accumulated other comprehensive loss, net of deferred taxes of
$(19) and $(45)
    
    
    (30
    )
    
    
    (70
    )Unearned Employee Stock Ownership Plan (ESOP)
    
    
    (2,030
    )
    
    
    (2,074
    )Common stock held in treasury, at cost (228,400 and 189,300 shares)
    
    
    (2,104
    )
    
    
    (1,754
    )Total stockholders equity
    
    
    43,411
    
    
    
    43,773Total liabilities and stockholders equity
    
    $
    325,790
    
    
    $
    305,273
  1




---



##### Table of Contents



CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
 For the Three MonthsEnded March 31,(Dollars in thousands, except per share data)
    
    2008
    
    2007Interest income:Loans
    
    $
    2,818
    
    
    $
    2,494Securities
    
    
    1,386
    
    
    
    1,025Other interest-earning assets
    
    
    102
    
    
    
    119Total interest income
    
    
    4,306
    
    
    
    3,638Interest expense:Deposits
    
    
    1,308
    
    
    
    1,168Borrowings
    
    
    1,118
    
    
    
    956Total interest expense
    
    
    2,426
    
    
    
    2,124Net interest income
    
    
    1,880
    
    
    
    1,514Provision for loan losses
    
    
    59
    
    
    
    45Net interest income after provision for loan losses
    
    
    1,821
    
    
    
    1,469Noninterest income:Fees and service charges
    
    
    102
    
    
    
    95Insurance commissions
    
    
    720
    
    
    
    591Income from bank-owned life insurance
    
    
    67
    
    
    
    70Net gain (loss) on sales of securities
    
    
    156
    
    
    
    (1,409
    )Loss on sale of real estate owned
    
    
    (3
    )
    
    
    Other
    
    
    3
    
    
    
    3Total noninterest income
    
    
    1,045
    
    
    
    (650
    )Noninterest expense:Compensation and employee benefits
    
    
    1,462
    
    
    
    1,420Occupancy
    
    
    341
    
    
    
    253FDIC insurance premiums
    
    
    6
    
    
    
    6Data processing
    
    
    106
    
    
    
    90Other
    
    
    439
    
    
    
    445Total noninterest expense
    
    
    2,354
    
    
    
    2,214Minority interest in net income of consolidated subsidiary
    
    
    43
    
    
    
    31Income (loss) before income tax expense (benefit)
    
    
    469
    
    
    
    (1,426
    )Income tax expense (benefit)
    
    
    201
    
    
    
    (457
    )Net income (loss)
    
    $
    268
    
    
    $
    (969
    )Earnings (loss) per share:Basic and diluted
    
    $
    0.04
    
    
    $
    (0.15
    )Weighted-average shares outstanding:Basic
    
    
    6,231,354
    
    
    
    6,390,012Diluted
    
    
    6,231,516
    
    
    
    6,393,516
  2




---



##### Table of Contents



CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY AND COMPREHENSIVE INCOME (LOSS)
(UNAUDITED)
 Accumulated
    
    
    
    
    
    
    CommonAdditional
    
    
    
    
    
    
    Other
    
    
    
    
    
    
    Stock
    
    
    TotalCommon
    
    
    Paid-in-
    
    
    Retained
    
    
    Comprehensive
    
    
    Unearned
    
    
    Held in
    
    
    Stockholders
    
    
    ComprehensiveStock
    
    
    Capital
    
    
    Earnings
    
    
    Income (Loss)
    
    
    ESOP
    
    
    Treasury
    
    
    Equity
    
    
    (Loss) Income(Dollars in thousands)Balance at January 1, 2007
    
    $
    67
    
    
    $
    28,787
    
    
    $
    20,475
    
    
    $
    (737
    )
    
    $
    (2,246
    )
    
    $
    
    
    
    $
    46,346Comprehensive income:Net loss
    
    
    
    
    
    
    
    
    
    
    (969
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (969
    )
    
    $
    (969
    )Transfer of securities to
held for trading,
net of tax of $(552)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    857
    
    
    
    
    
    
    
    
    
    
    
    857
    
    
    
    857Unrealized loss on securities
available-for-sale,
net of tax of $(57)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (90
    )
    
    
    
    
    
    
    
    
    
    
    (90
    )
    
    
    (90
    )ESOP shares committed to be
released (4,320 shares)
    
    
    
    
    
    
    (3
    )
    
    
    
    
    
    
    
    
    
    
    43
    
    
    
    
    
    
    
    40Stock-based compensation
expense
    
    
    
    
    
    
    85
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    85Total comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (202
    )Balance at March 31, 2007
    
    $
    67
    
    
    $
    28,869
    
    
    $
    19,506
    
    
    $
    30
    
    
    $
    (2,203
    )
    
    $
    
    
    
    $
    46,269Accumulated
    
    
    
    
    
    
    CommonAdditional
    
    
    
    
    
    
    Other
    
    
    
    
    
    
    Stock
    
    
    TotalCommon
    
    
    Paid-in-
    
    
    Retained
    
    
    Comprehensive
    
    
    Unearned
    
    
    Held in
    
    
    Stockholders
    
    
    ComprehensiveStock
    
    
    Capital
    
    
    Earnings
    
    
    (Loss) Income
    
    
    ESOP
    
    
    Treasury
    
    
    Equity
    
    
    Income (Loss)Balance at January 1, 2008
    
    $
    67
    
    
    $
    29,084
    
    
    $
    18,520
    
    
    $
    (70
    )
    
    $
    (2,074
    )
    
    $
    (1,754
    )
    
    $
    43,773Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    268
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    268
    
    
    $
    268Unrealized
gain on securities
available-for-sale,
net of tax of $125
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    194
    
    
    
    
    
    
    
    
    
    
    
    194
    
    
    
    194Reclassification adjustment
on sales of securities
available-for-sale,
net of tax of $99
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (154
    )
    
    
    
    
    
    
    
    
    
    
    (154
    )
    
    
    (154
    )Cumulative effect
adjustment on benefit
plan reserve
    
    
    
    
    
    
    
    
    
    
    (445
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (445
    )Purchase of common
stock to be held in
treasury (39,100 shares)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (350
    )
    
    
    (350
    )ESOP shares committed to be
released (4,320 shares)
    
    
    
    
    
    
    (6
    )
    
    
    
    
    
    
    
    
    
    
    44
    
    
    
    
    
    
    
    38Stock-based compensation
expense
    
    
    
    
    
    
    87
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    87Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    308Balance at March 31, 2008
    
    $
    67
    
    
    $
    29,165
    
    
    $
    18,343
    
    
    $
    (30
    )
    
    $
    (2,030
    )
    
    $
    (2,104
    )
    
    $
    43,411
  3




---



##### Table of Contents



CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
 For the PeriodEnded March 31,(Dollars in thousands)
    
    2008
    
    2007Cash flows from operating activities:Net income (loss)
    
    $
    268
    
    
    $
    (969
    )Adjustments to reconcile net income (loss) to net cash provided
by operating activitiesMinority interest in net income of consolidated subsidiary
    
    
    43
    
    
    
    31Provision for loan losses
    
    
    59
    
    
    
    45Depreciation
    
    
    122
    
    
    
    85Net (gain) loss on sales of securities
    
    
    (156
    )
    
    
    1,409Net loss on sale of real estate owned
    
    
    3
    
    
    
    Net (amortization) accretion of security premiums and loan costs
    
    
    (20
    )
    
    
    51Non cash expense for ESOP
    
    
    38
    
    
    
    40Non cash expense for stock-based compensation
    
    
    87
    
    
    
    85Increase in bank-owned life insurance
    
    
    (67
    )
    
    
    (70
    )(Increase) decrease in other assets
    
    
    (293
    )
    
    
    56Increase (decrease) in other liabilities
    
    
    505
    
    
    
    (492
    )Net cash provided by operating activities
    
    
    589
    
    
    
    271Cash flows from investing activities:Net loan originations
    
    
    (5,445
    )
    
    
    (1,437
    )Proceeds from maturities of and principal repayments of
securities available-for-sale
    
    
    5,402
    
    
    
    7,468Proceeds from sales of securities available-for-sale
    
    
    8,766
    
    
    
    Purchases of securities available-for-sale
    
    
    (28,352
    )
    
    
    (4,439
    )Purchases of premises and equipment
    
    
    (64
    )
    
    
    (191
    )(Increase) decrease in FHLB stock, at cost
    
    
    (885
    )
    
    
    60Net cash (used in) provided by investing activities
    
    
    (20,578
    )
    
    
    1,461Cash flows from financing activities:Net increase (decrease) in borrowings
    
    
    14,073
    
    
    
    (2,188
    )Net increase in deposits
    
    
    6,307
    
    
    
    4,226(Decrease) increase in advance payments by borrowers for taxes and insurance
    
    
    (5
    )
    
    
    167Purchases of common stock held in treasury
    
    
    (350
    )
    
    
    Net cash provided by financing activities
    
    
    20,025
    
    
    
    2,205Net increase in cash and cash equivalents
    
    
    36
    
    
    
    3,937Cash and cash equivalents, beginning of period
    
    
    5,552
    
    
    
    4,499Cash and cash equivalents, end of period
    
    $
    5,588
    
    
    $
    8,436Supplemental cash flow information:Cash paid for:Interest on deposits and borrowings
    
    $
    2,241
    
    
    $
    1,958Income tax expense
    
    
    16
    
    
    
    12Transfer of securities from available-for-sale to held for trading
    
    
    
    
    
    
    42,531Real estate acquired in settlement of loans
    
    
    160
    
    
    
    
  4




---



##### Table of Contents



Notes to the Unaudited Consolidated Financial Statements
 Note 1. Basis of Presentation/Nature of Operations
     Note 2. Recent Accounting Pronouncements
 Noncontrolling Interests in Consolidated Financial Statements  an amendment of Accounting
Research Bulletin (ARB) No. 51. Noncontrolling
Interests in Consolidated Financial Statements  an amendment of ARB No. 51
 5




---



##### Table of Contents



The Fair Value Option for Financial Assets and Financial Liabilities: The Fair Value Option for Financial Assets and Financial Liabilities
 Fair Value Measurements: Fair Value Measurements
 Effective Date of FASB Statement No. 157: Effective Date of FASB Statement No. 157
 Accounting for Deferred Compensation and Postretirement Benefit Aspects of Endorsement Split-Dollar
Life Insurance Arrangements:
 6




---



##### Table of Contents



Note 3. Securities
  Gross
    
    GrossAmortized
    
    Unrealized
    
    Unrealized
    
    FairMarch 31, 2008
    
    Cost
    
    Gains
    
    Losses
    
    ValueGovernment-Sponsored Enterprises
    
    $
    15,712
    
    
    $
    421
    
    
    $
    
    
    
    $
    16,133Mortgage-backed
    
    
    57,173
    
    
    
    814
    
    
    
    11
    
    
    
    57,976REMICs
    
    
    26,616
    
    
    
    290
    
    
    
    1,005
    
    
    
    25,901Corporate debt
    
    
    3,995
    
    
    
    
    
    
    
    558
    
    
    
    3,437Equities
    
    
    49
    
    
    
    
    
    
    
    
    
    
    
    49Total securities available-for-sale
    
    $
    103,545
    
    
    $
    1,525
    
    
    $
    1,574
    
    
    $
    103,496
 Gross
    
    GrossAmortized
    
    Unrealized
    
    Unrealized
    
    FairDecember 31, 2007
    
    Cost
    
    Gains
    
    Losses
    
    ValueGovernment-Sponsored Enterprises
    
    $
    22,321
    
    
    $
    353
    
    
    $
    
    
    
    $
    22,674Mortgage-backed
    
    
    34,948
    
    
    
    242
    
    
    
    37
    
    
    
    35,153REMICs
    
    
    27,875
    
    
    
    80
    
    
    
    478
    
    
    
    27,477Corporate debt
    
    
    3,995
    
    
    
    
    
    
    
    275
    
    
    
    3,720Equities
    
    
    49
    
    
    
    
    
    
    
    
    
    
    
    49Total securities available-for-sale
    
    $
    89,188
    
    
    $
    675
    
    
    $
    790
    
    
    $
    89,073
  Level 1 
    
    Quoted prices for identical instruments in active markets.Level 2 
    
    Quoted prices for similar instruments in active markets; quoted prices
for identical or similar instruments in markets that are active, and model derived
valuations in which significant inputs or significant drivers are observable in active
markets.Level 3 
    
    Valuations derived from valuation techniques in which one or more
significant inputs or significant drivers are unobservable.
 7




---



##### Table of Contents



Significant Other
    
    Significant(Dollars in thousands)
    
    Observable Inputs
    
    Unobservable InputsMarch 31, 2008
    
    (Level 2)
    
    (Level 3)
    
    TotalSecurities available-for-sale
    
    $
    100,722
    
    
    $
    2,774
    
    
    $
    103,496
 SignificantUnobservable Inputs(Dollars in thousands)
    
    (Level 3)December 31, 2007
    
    $
    4,333Total unrealized losses
    
    
    (230
    )Purchases
    
    
    Settlements
    
    
    Paydowns and maturities
    
    
    Transfers in/(out) of level 3
    
    
    (1,329
    )March 31, 2008
    
    $
    2,774The amount of total unrealized losses for the period
included in earnings (or changes in net assets)
attributable to the change in unrealized gains (losses)
relating to assets still held
at March 31, 2008
    
    $
    (363
    )
  8




---



##### Table of Contents



Less than 12 months
    
    12 months or more
    
    TotalNumber of
    
    Fair
    
    Unrealized
    
    Number of
    
    Fair
    
    Unrealized
    
    Number of
    
    Fair
    
    UnrealizedMarch 31, 2008
    
    Securities
    
    Value
    
    Losses
    
    Securities
    
    Value
    
    Losses
    
    Securities
    
    Value
    
    LossesMortgage-backed
    
    
    3
    
    
    $
    2,919
    
    
    $
    10
    
    
    
    2
    
    
    $
    17
    
    
    $
    1
    
    
    
    5
    
    
    $
    2,936
    
    
    $
    11REMICs:Private label issuer:Prime fixed and adjustable rate
    
    
    3
    
    
    
    1,135
    
    
    
    19
    
    
    
    1
    
    
    
    732
    
    
    
    79
    
    
    
    4
    
    
    
    1,867
    
    
    
    98Alt-A fixed rate
    
    
    10
    
    
    
    9,938
    
    
    
    878
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10
    
    
    
    9,938
    
    
    
    878Government-sponsored enterprises
    
    
    2
    
    
    
    581
    
    
    
    28
    
    
    
    1
    
    
    
    30
    
    
    
    1
    
    
    
    3
    
    
    
    611
    
    
    
    29Total REMICs
    
    
    15
    
    
    
    11,654
    
    
    
    925
    
    
    
    2
    
    
    
    762
    
    
    
    80
    
    
    
    17
    
    
    
    12,416
    
    
    
    1,005Corporate debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3
    
    
    
    3,437
    
    
    
    558
    
    
    
    3
    
    
    
    3,437
    
    
    
    558Total securities temporarily impaired
    
    
    18
    
    
    $
    14,573
    
    
    $
    935
    
    
    
    7
    
    
    $
    4,216
    
    
    $
    639
    
    
    
    25
    
    
    $
    18,789
    
    
    $
    1,574
 Less than 12 months
    
    12 months or more
    
    TotalNumber of
    
    Fair
    
    Unrealized
    
    Number of
    
    Fair
    
    Unrealized
    
    Number of
    
    Fair
    
    UnrealizedDecember 31, 2007
    
    Securities
    
    Value
    
    Losses
    
    Securities
    
    Value
    
    Losses
    
    Securities
    
    Value
    
    LossesMortgage-backed
    
    
    8
    
    
    $
    9,946
    
    
    $
    35
    
    
    
    3
    
    
    $
    119
    
    
    $
    2
    
    
    
    11
    
    
    $
    10,065
    
    
    $
    37REMICs:Private label issuer:Prime fixed and adjustable rate
    
    
    2
    
    
    
    778
    
    
    
    2
    
    
    
    2
    
    
    
    1,028
    
    
    
    16
    
    
    
    4
    
    
    
    1,806
    
    
    
    18Alt-A fixed rate
    
    
    7
    
    
    
    8,390
    
    
    
    380
    
    
    
    1
    
    
    
    766
    
    
    
    57
    
    
    
    8
    
    
    
    9,156
    
    
    
    437Government-sponsored enterprises
    
    
    3
    
    
    
    3,277
    
    
    
    22
    
    
    
    5
    
    
    
    130
    
    
    
    1
    
    
    
    8
    
    
    
    3,407
    
    
    
    23Total REMICs
    
    
    12
    
    
    
    12,445
    
    
    
    404
    
    
    
    8
    
    
    
    1,924
    
    
    
    74
    
    
    
    20
    
    
    
    14,369
    
    
    
    478Corporate debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3
    
    
    
    3,720
    
    
    
    275
    
    
    
    3
    
    
    
    3,720
    
    
    
    275Total securities temporarily impaired
    
    
    20
    
    
    $
    22,391
    
    
    $
    439
    
    
    
    14
    
    
    $
    5,763
    
    
    $
    351
    
    
    
    34
    
    
    $
    28,154
    
    
    $
    790
    9




---



##### Table of Contents



Note 4. Loans
  March 31, 2008
    
    December 31, 2007
    
    March 31, 2007(Dollars in thousands)
    
    Amount
    
    Percent
    
    Amount
    
    Percent
    
    Amount
    
    PercentReal estate-mortgage:One-to-four family residential
    
    $
    137,827
    
    
    
    70.1
    %
    
    $
    135,453
    
    
    
    70.4
    %
    
    $
    132,800
    
    
    
    74.4
    %Multi-family
    
    
    10,147
    
    
    
    5.2
    
    
    
    11,042
    
    
    
    5.7
    
    
    
    16,411
    
    
    
    9.2Commercial
    
    
    16,029
    
    
    
    8.2
    
    
    
    15,426
    
    
    
    8.0
    
    
    
    8,039
    
    
    
    4.5Total real estate-mortgage
    
    
    164,003
    
    
    
    83.5
    
    
    
    161,921
    
    
    
    84.1
    
    
    
    157,250
    
    
    
    88.1Real estate-construction:Residential
    
    
    5,503
    
    
    
    2.8
    
    
    
    6,671
    
    
    
    3.5
    
    
    
    4,422
    
    
    
    2.5Commercial
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,750
    
    
    
    1.0Total real estate-construction
    
    
    5,503
    
    
    
    2.8
    
    
    
    6,671
    
    
    
    3.5
    
    
    
    6,172
    
    
    
    3.5Consumer:Home equity
    
    
    19,149
    
    
    
    9.8
    
    
    
    17,862
    
    
    
    9.3
    
    
    
    11,162
    
    
    
    6.3Loans on savings accounts
    
    
    521
    
    
    
    0.3
    
    
    
    675
    
    
    
    0.4
    
    
    
    374
    
    
    
    0.2Home improvement
    
    
    268
    
    
    
    0.1
    
    
    
    281
    
    
    
    0.1
    
    
    
    378
    
    
    
    0.2Other
    
    
    597
    
    
    
    0.3
    
    
    
    592
    
    
    
    0.3
    
    
    
    579
    
    
    
    0.3Total consumer
    
    
    20,535
    
    
    
    10.5
    
    
    
    19,410
    
    
    
    10.1
    
    
    
    12,493
    
    
    
    7.0Commercial business
    
    
    6,352
    
    
    
    3.2
    
    
    
    4,341
    
    
    
    2.3
    
    
    
    2,566
    
    
    
    1.4Total loans
    
    $
    196,393
    
    
    
    100.0
    %
    
    $
    192,343
    
    
    
    100.0
    %
    
    $
    178,481
    
    
    
    100.0
    %Premium on loans purchased
    
    
    294
    
    
    
    
    
    
    
    310
    
    
    
    
    
    
    
    433Net deferred loan costs
    
    
    507
    
    
    
    
    
    
    
    491
    
    
    
    
    
    
    
    426Discount on loans purchased
    
    
    (116
    )
    
    
    
    
    
    
    (119
    )
    
    
    
    
    
    
    (128
    )Loans in process
    
    
    (2,550
    )
    
    
    
    
    
    
    (3,614
    )
    
    
    
    
    
    
    (2,219
    )Allowance for loan losses
    
    
    (1,345
    )
    
    
    
    
    
    
    (1,457
    )
    
    
    
    
    
    
    (911
    )Loans, net
    
    $
    193,183
    
    
    
    
    
    
    $
    187,954
    
    
    
    
    
    
    $
    176,082
 10




---



##### Table of Contents



Nonperforming Assets.
 March 31,
    
    December 31,
    
    March 31,(Dollars in thousands)
    
    2008
    
    2007
    
    2007Nonaccrual loans:Real estate  mortgage
    
    $
    803
    
    
    $
    1,264
    
    
    $
    538Real estate  construction
    
    
    
    
    
    
    
    
    
    
    Consumer
    
    
    23
    
    
    
    17
    
    
    
    174Commercial business
    
    
    
    
    
    
    
    
    
    
    Total
    
    
    826
    
    
    
    1,281
    
    
    
    712Accruing loans past due 90 days or more
    
    
    
    
    
    
    
    
    
    
    Total of nonaccrual and 90 days or
more past due loans
    
    
    826
    
    
    
    1,281
    
    
    
    712Real estate owned
    
    
    766
    
    
    
    1,119
    
    
    
    569Total nonperforming assets
    
    $
    1,592
    
    
    $
    2,400
    
    
    $
    1,281Troubled debt restructurings
    
    
    
    
    
    
    
    
    
    
    Troubled debt restructurings and total
nonperforming assets
    
    $
    1,592
    
    
    $
    2,400
    
    
    $
    1,281Total nonperforming loans to total loans
    
    
    0.42
    %
    
    
    0.67
    %
    
    
    0.40
    %Total nonperforming loans to total assets
    
    
    0.25
    
    
    
    0.42
    
    
    
    0.25Total nonperforming assets to total assets
    
    
    0.49
    
    
    
    0.79
    
    
    
    0.45
 Allowance for loan losses.
 Three Months
    
    Year
    
    Three MonthsEnded
    
    Ended
    
    EndedMarch 31,
    
    December 31,
    
    March 31,(Dollars in thousands)
    
    2008
    
    2007
    
    2007Allowance at beginning of period
    
    $
    1,457
    
    
    $
    866
    
    
    $
    866Provision for loan losses
    
    
    59
    
    
    
    1,119
    
    
    
    45Charge-offs
    
    
    (171
    )
    
    
    (528
    )
    
    
    Recoveries
    
    
    
    
    
    
    
    
    
    
    Net charge-offs
    
    
    (171
    )
    
    
    (528
    )
    
    
    Allowance at end of period
    
    $
    1,345
    
    
    $
    1,457
    
    
    $
    911
  11




---



##### Table of Contents



Note 5. Deposits
  March 31, 2008
    
    December 31, 2007
    
    March 31, 2007(Dollars in thousands)
    
    Amount
    
    Percent
    
    Amount
    
    Percent
    
    Amount
    
    PercentNoninterest-bearing demand deposits
    
    $
    10,832
    
    
    
    6.7
    %
    
    $
    8,918
    
    
    
    5.7
    %
    
    $
    7,005
    
    
    
    4.8
    %Interest-bearing demand deposits
    
    
    11,791
    
    
    
    7.3
    
    
    
    11,864
    
    
    
    7.6
    
    
    
    13,469
    
    
    
    9.1Savings accounts
    
    
    23,441
    
    
    
    14.5
    
    
    
    23,056
    
    
    
    14.8
    
    
    
    25,907
    
    
    
    17.5Money market accounts
    
    
    18,582
    
    
    
    11.5
    
    
    
    13,676
    
    
    
    8.8
    
    
    
    9,858
    
    
    
    6.7Certificates of deposit
    
    
    97,219
    
    
    
    60.0
    
    
    
    98,044
    
    
    
    63.1
    
    
    
    91,482
    
    
    
    61.9Total deposits
    
    $
    161,865
    
    
    
    100.0
    %
    
    $
    155,558
    
    
    
    100.0
    %
    
    $
    147,721
    
    
    
    100.0
    %
 Note 6. Borrowings
  Three Months
    
    Year
    
    Three MonthsEnded
    
    Ended
    
    EndedMarch 31,
    
    December 31,
    
    March 31,(Dollars in thousands)
    
    2008
    
    2007
    
    2007Maximum amount outstanding at any month end
during the period
    
    $
    121,776
    
    
    $
    101,074
    
    
    $
    89,663Average amounts outstanding during the period
    
    
    109,067
    
    
    
    82,880
    
    
    
    88,867Weighted average rate during the period
    
    
    4.10
    %
    
    
    4.32
    %
    
    
    4.30
    %Balance outstanding at end of period
    
    $
    115,147
    
    
    $
    101,074
    
    
    $
    87,135Weighted average rate at end of period
    
    
    3.86
    %
    
    
    4.30
    %
    
    
    4.24
    %
 Note 7. Earnings (Loss) Per Share
  12




---



##### Table of Contents



Three Months EndedMarch 31,(Dollars in thousands, except per share amounts)
    
    2008
    
    2007Net income (loss)
    
    $
    268
    
    
    $
    (969
    )Weighted-average shares outstanding:Basic
    
    
    6,231,354
    
    
    
    6,390,012Effect of dilutive stock options and
restrictive stock awards
    
    
    162
    
    
    
    3,504Diluted
    
    
    6,231,516
    
    
    
    6,393,516Earnings (loss) per share:Basic
    
    $
    0.04
    
    
    $
    (0.15
    )Diluted
    
    $
    0.04
    
    
    $
    (0.15
    )
 Note 8. Insurance Activities of Exchange Underwriters, Inc. and Related Information
  March 31,
    
    December 31,
    
    March 31,(Dollars in thousands)
    
    2008
    
    2007
    
    2007Insurance commissions
    
    $
    720
    
    
    $
    1,639
    
    
    $
    591Income before income tax expense
    
    
    372
    
    
    
    472
    
    
    
    271Total assets
    
    
    1,070
    
    
    
    1,258
    
    
    
    1,018
 
 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
  Forward-Looking Statements
   13




---



##### Table of Contents



General
     Balance Sheet Analysis
 Assets.
    Liabilities.
 14




---



##### Table of Contents



Stockholders Equity.
 Results of Operations for the Three Months Ended March 31, 2008 and 2007
 Overview.
 Three Months EndedMarch 31,(Dollars in thousands)
    
    2008
    
    
    2007Net income (loss)
    
    $
    268
    
    
    $
    (969
    )Return on average assets
    
    
    0.34
    %
    
    
    (1.36
    )%Return on average equity
    
    
    2.48
    
    
    
    (8.35
    )Average equity to average assets
    
    
    13.54
    
    
    
    16.29
 Net Interest Income.
   15




---



##### Table of Contents



Average Balances and Yields .
 Three Months Ended March 31,2008
    
    
    2007Interest
    
    
    
    
    
    
    
    
    
    
    InterestAverage
    
    
    and
    
    
    Yield/
    
    
    Average
    
    
    and
    
    
    Yield/Balance
    
    
    Dividends
    
    
    Cost
    
    
    Balance
    
    
    Dividends
    
    
    CostAssets:Interest-earning assets:Loans, net (1)(2)
    
    $
    190,664
    
    
    $
    2,818
    
    
    
    5.91
    %
    
    $
    175,531
    
    
    $
    2,494
    
    
    
    5.68
    %Securities (3)
    
    
    98,732
    
    
    
    1,386
    
    
    
    5.62
    
    
    
    84,227
    
    
    
    1,025
    
    
    
    4.87Other interest-earning assets
    
    
    10,908
    
    
    
    102
    
    
    
    3.74
    
    
    
    8,385
    
    
    
    119
    
    
    
    5.68Total interest-earning
assets
    
    
    300,304
    
    
    $
    4,306
    
    
    
    5.74
    
    
    
    268,143
    
    
    $
    3,638
    
    
    
    5.43Noninterest-earning assets
    
    
    19,291
    
    
    
    
    
    
    
    
    
    
    
    16,652Total assets
    
    $
    319,595
    
    
    
    
    
    
    
    
    
    
    $
    284,795Liabilities and
Stockholders equity:Interest-bearing liablities:Interest-bearing
demand deposits
    
    $
    11,899
    
    
    $
    14
    
    
    
    0.47
    %
    
    $
    12,996
    
    
    $
    15
    
    
    
    0.46
    %Savings accounts
    
    
    23,111
    
    
    
    51
    
    
    
    0.88
    
    
    
    26,245
    
    
    
    65
    
    
    
    0.99Money market accounts
    
    
    15,269
    
    
    
    127
    
    
    
    3.33
    
    
    
    8,529
    
    
    
    75
    
    
    
    3.52Certificates of deposit
    
    
    101,162
    
    
    
    1,116
    
    
    
    4.41
    
    
    
    91,510
    
    
    
    1,013
    
    
    
    4.43Total interest-bearing
deposits
    
    
    151,441
    
    
    
    1,308
    
    
    
    3.45
    
    
    
    139,280
    
    
    
    1,168
    
    
    
    3.35Borrowings
    
    
    109,067
    
    
    
    1,118
    
    
    
    4.10
    
    
    
    88,867
    
    
    
    956
    
    
    
    4.30Total interest-bearing
liabilities
    
    
    260,508
    
    
    
    2,426
    
    
    
    3.73
    
    
    
    228,147
    
    
    
    2,124
    
    
    
    3.72Noninterest-bearing liabilities
    
    
    15,815
    
    
    
    
    
    
    
    
    
    
    
    10,242Total liabilities
    
    
    276,323
    
    
    
    
    
    
    
    
    
    
    
    238,389Stockholders equity:
    
    
    43,272
    
    
    
    
    
    
    
    
    
    
    
    46,406Total liabilities and
stockholders equity
    
    $
    319,595
    
    
    
    
    
    
    
    
    
    
    $
    284,795Net interest income
    
    
    
    
    
    $
    1,880
    
    
    
    
    
    
    
    
    
    
    $
    1,514Interest rate spread (4)
    
    
    
    
    
    
    
    
    
    
    2.01
    %
    
    
    
    
    
    
    
    
    
    
    1.71
    %Net interest margin (5)
    
    
    
    
    
    
    
    
    
    
    2.50
    
    
    
    
    
    
    
    
    
    
    
    2.26Average interest-earning
assets to average
interest-bearing liablities
    
    
    
    
    
    
    
    
    
    
    115.28
    %
    
    
    
    
    
    
    
    
    
    
    117.53
    %
 
 (1)
    
    Amount is net of deferred loan costs, loans in process and estimated allowance for loan losses.(2)
    
    Amount includes nonaccrual loans in average balances only.(3)
    
    Amount does not include effect of unrealized gain (loss) on securities available-for-sale.(4)
    
    Interest rate spread represents the difference between the yield on interest-earning assets
and the cost of interest-bearing liabilities.(5)
    
    Net interest margin represents net interest income divided by average interest-earning
assets. 
 16




---



##### Table of Contents



Rate/Volume Analysis .
 Three Months Ended March 31, 2008Compared ToThree Months Ended March 31, 2007Increase (decrease) due to(Dollars in thousands)
    
    Volume
    
    Rate
    
    TotalInterest and dividend income:Loans, net
    
    $
    220
    
    
    $
    104
    
    
    $
    324Securities
    
    
    190
    
    
    
    171
    
    
    
    361Other interest-earning assets
    
    
    30
    
    
    
    (47
    )
    
    
    (17
    )Total interest-earning assets
    
    
    440
    
    
    
    228
    
    
    
    668Interest expense:Deposits
    
    
    104
    
    
    
    36
    
    
    
    140Borrowings
    
    
    208
    
    
    
    (46
    )
    
    
    162Total interest-bearing liablities
    
    
    312
    
    
    
    (10
    )
    
    
    302Change in net interest income
    
    $
    128
    
    
    $
    238
    
    
    $
    366
 Provision for Loan Losses.
 Noninterest Income .
 17




---



##### Table of Contents



Noninterest Expense.
 Three Months EndedMarch 31,(Dollars in thousands)
    
    2008
    
    
    2007Compensation and employee benefits
    
    $
    1,462
    
    
    $
    1,420Occupancy
    
    
    341
    
    
    
    253FDIC insurance premiums
    
    
    6
    
    
    
    6Data processing
    
    
    106
    
    
    
    90Advertising
    
    
    32
    
    
    
    29Professional services
    
    
    128
    
    
    
    138Stationary, printing and supplies
    
    
    28
    
    
    
    31Telephone
    
    
    16
    
    
    
    13Postage
    
    
    38
    
    
    
    31Correspondent bank fees
    
    
    43
    
    
    
    31All other
    
    
    154
    
    
    
    172Total noninterest expense
    
    $
    2,354
    
    
    $
    2,214
  Income Tax (Benefit) Expense.
 Liquidity and Capital Management
 Liquidity Management .
    18




---



##### Table of Contents



March 31,(Dollars in thousands)
    
    2008Loans in process
    
    $
    2,550Unused revolving lines of credit
    
    
    2,616Unused commercial business lines of credit
    
    
    1,474One-to-four family residential commitments
    
    
    2,207Consumer commitments
    
    
    433Commercial commitments
    
    
    1,000Total commitments outstanding
    
    $
    10,280
 Capital Management.
 Off-Balance Sheet Arrangements.
  
 Item 3. Quantitative and Qualitative Disclosures About Market Risk.
  
 Item 4. Controls and Procedures.
   19




---



##### Table of Contents



PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings.
  
 Item 1A. Risk Factors.
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
  Total Number ofShares Purchased
    
    Maximum Numberas Part of the
    
    of Shares that MayTotal Number
    
    Average Price
    
    Publicly
    
    Yet Be Purchasedof Shares
    
    Paid per
    
    Announced
    
    Under thePeriod
    
    Purchased
    
    Share
    
    Program(1)
    
    Program(1)January 2008
    
    
    27,100
    
    
    $
    9.07
    
    
    
    27,100
    
    
    
    82,100February 2008
    
    
    12,000
    
    
    
    8.63
    
    
    
    12,000
    
    
    
    70,100Total
    
    
    39,100
    
    
    
    8.94
    
    
    
    39,100
 
 (1)
    
    On September 27, 2007, the Company announced that the board of directors had approved a
program allowing the Company to repurchase up to 147,500 shares of the Companys
outstanding common stock, which was approximately 5% of outstanding shares held by persons
other than FFMHC on that date. On March 31, 2008, the Company announced that this
repurchase program, originally scheduled to expire on March 31, 2008, had been extended to
September 30, 2008. As of March 31, 2008, 77,400 shares of the Companys common stock had
been repurchased under this program. On May 5, 2008, the Company completed the purchases
under this program. The remaining 70,100 shares were repurchased at an average price of
$7.84 per share. 
 Item 3. Defaults Upon Senior Securities.
  
 Item 4. Submission of Matters to a Vote of Security Holders.
  20




---



##### Table of Contents



Item 5. Other Information.
  
 Item 6. Exhibits.
 3.1
    
    Amended and Restated Charter of FedFirst Financial Corporation (1)3.2
    
    Amended and Restated Bylaws of FedFirst Financial Corporation (2)4.0
    
    Specimen Stock Certificate of FedFirst Financial Corporation (1)10.1
    
    Form of 409A Amendment, effective January 1, 2005, to the Director Fee Continuation
Agreements, dated June 30, 1999, between First Federal Savings Bank and Joseph U. Frye,
John J. LaCarte and Jack M. McGinley (3)10.2
    
    Amendment, dated July 19, 2002, to the Life Insurance Endorsement Method Split Dollar
Plan Agreement by and between First Federal Savings Bank and Richard B. Boyer, effective
June 1, 2002 (3)10.3
    
    Amendment, dated July 19, 2002, to the Executive Supplemental Retirement Plan Agreement
by and between First Federal Savings Bank and Richard B. Boyer, effective June 1, 2002
(3)10.4
    
    Amendment, effective September 13, 2005, to the Executive Supplemental Retirement Plan
Agreement by and between First Federal Savings Bank and Richard B. Boyer, effective June 1,
2002, and to the Life Insurance Endorsement Method Split Dollar Plan Agreement by and
between First Federal Savings Bank and Richard B. Boyer, effective June 1, 2002
(3)10.5
    
    409A Amendment, effective January 1, 2005, to the Executive Supplemental Retirement
Plan Agreement between First Federal Savings Bank and Richard B. Boyer, effective September
13, 2005 (3)31.1
    
    Rule 13a-14 (a) / 15d-14 (a) Certification (President and Chief Executive Officer)31.2
    
    Rule 13a-14 (a) / 15d-14 (a) Certification (Chief Financial Officer)32.1
    
    Certification of John G. Robinson pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    Certification of Robert C. Barry Jr. pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 
 (1)
    
    Incorporated herein by reference to the Exhibits to the Registration Statement on Form SB-2,
and amendments thereto, initially filed on December 17, 2004, Registration No. 333-121405.(2)
    
    Incorporated herein by reference to the Exhibits to FedFirst Financial Corporations Form 8-K
filed on October 26, 2007.(3)
    
    Management contract or compensation plan or arrangement. 
 21




---



##### Table of Contents



SIGNATURES
  FEDFIRST FINANCIAL
CORPORATION
                        (Registrant)Date:      May 9, 2008
    /s/ John G. RobinsonJohn G. RobinsonPresident and Chief Executive OfficerDate:      May 9, 2008
    /s/ Robert C. Barry Jr.Robert C. Barry Jr.Chief Financial Officer and Senior Vice President
(Principal Financial Officer and Chief Accounting Officer) 22