EXHIBIT 13
                                                                      ----------




================================================================================
                                TABLE OF CONTENTS
================================================================================







President's Message . . . . . . . . . . . . . . . . . . . . . . . . . . . .    2

Selected Consolidated Financial Information . . . . . . . . . . . . . . . .    3

Management's Discussion and Analysis of
Financial Condition and Results of Operations . . . . . . . . . . . . . . .    5

Independent Auditors' Report  . . . . . . . . . . . . . . . . . . . . . . .   18

Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . .   19

Stockholder Information . . . . . . . . . . . . . . . . . . . . . . . . . .   48

Corporate Information . . . . . . . . . . . . . . . . . . . . . . . . . . .   49


















                                        1
<PAGE>

President's Message
To Our Stockholders

On behalf of the Board of Directors, Officers and Employees of AMB Financial
Corp. (the Company), and its wholly owned subsidiary, American Savings, FSB (the
Bank), I am pleased to present our 2003 Annual Report. As we enter our 94th year
of serving the financial needs of the people and businesses in Northwest Indiana
we are pleased with our progress in 2003. Our primary goals are to remain a
customer-focused independent community financial institution while increasing
the value of your investment.

In the last year we reduced our investment securities due to the low prevailing
yields. As a result, assets declined slightly. In addition, we used our excess
liquidity to decrease our borrowings by $4.2 million to $16 million. Total loans
increased 5.15% or $5.9 million while our deposits decreased 1% or $1 million.

During 2003 we had record net income of $1.2 million, representing $1.18 per
diluted share, an increase of $.21. Our 2003 return on average assets was .78%
and our return on average equity was 9.72%.

The Company approved a 5 for 4 stock split in April 2003. During 2003 the
Company repurchased 37,625 shares, leaving 949,379 outstanding as of December
31. 2003. Book value per share increased $1.19 to $13.19. On a split-adjusted
basis, our stock price has climbed from $11.89 per share on January 1, 2003 to
$18.10 on March 16, 2004.

I believe that we have a very competent and friendly staff. Through the efforts
of all of our employees, American Savings, FSB was recently voted as the #1 Best
Bank in the Region by the readers of The Times, our leading local newspaper. We
believe that this recognition of our customer service bodes well for our future
success.

Our strategy for the coming year continues to emphasize growth while watching
the bottom line. I believe that this strategy is in the best interests of both
the Bank and the stockholders.

Our financial performance and our stock performance are available on our web
site at http://www.ambfinancial.com. I urge you to visit our site to view this
information and utilize its other services.

The entire staff of the Bank and the Company appreciates your commitment and
support, and we look forward to a long and profitable relationship.
Sincerely,



Clement B. Knapp, Jr.
President




                                        2
<PAGE>

                   SELECTED CONSOLIDATED FINANCIAL INFORMATION
                  (Dollars in thousands except per share data)


<TABLE><CAPTION>
                                                                              For the Year Ended December 31
                                                             ----------------------------------------------------------------
                                                               2003          2002          2001          2000          1999
                                                             ----------------------------------------------------------------
<S>                                                          <C>           <C>           <C>           <C>           <C>
SELECTED OPERATING DATA:

Total interest income                                        $  8,235      $  8,847      $  9,500      $  9,209      $  8,252
Total interest expense                                          3,904         4,693         6,293         5,859         4,904
                                                             --------      --------      --------      --------      --------
     Net interest income                                        4,331         4,154         3,207         3,350         3,348
Provision for loan losses                                         214           392           152           124           119
                                                             --------      --------      --------      --------      --------
     Net interest income after provision for loan losses        4,117         3,762         3,055         3,226         3,229
                                                             --------      --------      --------      --------      --------

Non-interest income:
Fees and service charges                                         1181           991           780           492           450
Rental income                                                      77           145           290            47            --
Gain (loss) on sale of securities                                  50            22            85           (64)          116
Unrealized gain (loss) on trading securities                      130            36            99           122          (124)
Gain (loss) on sale of real estate owned                           24           (28)           --            --            10
Loss from investment in joint venture                             (91)          (88)         (104)          (93)          (54)
Increase in cash surrender value of life insurance                152           158           156           138           126
Loan loss settlement                                               92            --            --            --            --
Other                                                              57            99           108            77            88
                                                             --------      --------      --------      --------      --------
     Total non-interest income                                  1,672         1,335         1,414           719           612
                                                             --------      --------      --------      --------      --------

Non-interest expense:
Compensation and benefits                                       1,959         1,799         1,554         1,411         1,345
Office occupancy and equipment expenses                           471           441           465           366           311
Data processing                                                   521           485           447           425           398
Federal deposit insurance premiums                                 18            18            18            18            47
Professional fees                                                 248           231           210           173           135
Other                                                             819           746           651           565           580
                                                             --------      --------      --------      --------      --------
     Total non-interest expense                                 4,036         3,720         3,345         2,958         2,816
                                                             --------      --------      --------      --------      --------

Income before income taxes                                      1,753         1,377         1,124           987         1,025
Income tax provision                                              571           376           223           162           328
                                                             --------      --------      --------      --------      --------
Net income                                                      1,182         1,001           901           825           697
                                                             --------      --------      --------      --------      --------

Basic earnings per share                                     $   1.31      $   1.02      $   0.89      $   0.74      $   0.51
Diluted earnings per share                                   $   1.18      $   0.97      $   0.87      $   0.74      $   0.51
</TABLE>




                                        3
<PAGE>

                   SELECTED CONSOLIDATED FINANCIAL INFORMATION
                             (Dollars in thousands)


<TABLE><CAPTION>
                                                                                      At December 31,
                                                             ----------------------------------------------------------------
                                                               2003          2002          2001          2000          1999
                                                             ----------------------------------------------------------------
<S>                                                          <C>           <C>           <C>           <C>           <C>
SELECTED FINANCIAL DATA:
------------------------

Total assets                                                 $145,965      $149,672      $141,648      $135,699      $127,786
Loans receivable, net                                         120,209       114,318       112,513       112,482       105,910
Investment securities and interest bearing deposits             7,495        15,892        11,518         6,637         8,013
Mortgage-backed securities                                      3,155         2,643         3,023         3,424         1,868
Trading securities                                                498           566           583           936         1,909
Deposits                                                      108,334       109,331       102,210        89,712        88,945
Borrowed funds                                                 16,130        20,297        25,042        32,368        26,009
Guaranteed preferred beneficial interest in
  junior subordinated debentures                                5,000         5,000            --            --            --
Stockholders' equity                                           12,520        11,846        11,717        11,499        11,539
</TABLE>

<TABLE><CAPTION>
                                                                           At or For the Year Ended December 31,
                                                             ----------------------------------------------------------------
                                                               2003          2002          2001          2000          1999
                                                             ----------------------------------------------------------------
<S>                                                          <C>           <C>           <C>           <C>           <C>
SELECTED FINANCIAL RATIOS AND OTHER DATA:
-----------------------------------------

Return on average assets                                         0.78%         0.68%         0.65%         0.63%         0.58%
Return on average stockholders' equity                           9.72          8.36          7.99          7.47          5.68
Average stockholders' equity to average assets                   8.04          8.19          8.07          8.44         10.14
Stockholders' equity to total assets                             8.58          7.91          8.27          8.47          9.03
Interest rate spread during period                               3.26          3.20          2.51          2.55          2.70
Net interest margin                                              3.23          3.18          2.54          2.75          2.98
Operating expenses to average assets                             2.67          2.54          2.40          2.26          2.33
Efficiency ratio (1)                                            68.62         67.77         72.65         72.61         71.11
Non-performing assets to total assets                            1.08          0.79          1.02          0.80          0.73
Allowance for loan losses to non-
   performing loans                                             65.35         78.24         60.99         64.43         63.62
Allowance for loan losses to loans
   receivable, net (2)                                           0.85          0.73          0.68          0.62          0.55
Ratio of  average interest-earning
assets to average interest-bearing liabilities                    .99x          .99x         1.01x         1.04x         1.06x
Number of full-service offices                                      3             3             3             3             3
</TABLE>
(1)  Non-interest expense divided by net-interest income plus other income
     except for gains and losses on investments available for sale.
(2)  Loans include loans, net, excluding the allowance for loan losses.

                                       4
<PAGE>

           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS

GENERAL. AMB Financial Corp. (the "Company") is the thrift holding company for
American Savings FSB, (the "Bank"), a federally chartered savings bank.
Collectively, the Holding Company and the Bank are referred to herein as the
"Company."

The Company's primary market area consists of the northwest portion of Lake
County, Indiana. Business is conducted from its main office at 8230 Hohman
Avenue, Munster, Indiana, as well as two full-service banking offices located in
Dyer, and Hammond, Indiana. The Bank is a community-oriented savings institution
whose business primarily consists of accepting deposits from customers within
its market area and investing those funds in mortgage loans secured by
one-to-four-family residences. To a lesser extent, funds are invested in
commercial real estate, multi-family, consumer, commercial business, land and
construction loans. The Company also invests in mortgage-backed and other
investment securities.

The Company's results of operations are primarily dependent on net interest
income, which is the difference between the interest income on its
interest-earning assets, such as loans and securities, and the interest expense
on its interest-bearing liabilities, such as deposits and borrowings and to a
lesser degree, non-interest income and non-interest expense. Net interest income
depends upon the volume of interest-earning assets and interest-bearing
liabilities and the interest rate earned or paid on them, respectively.
Non-interest income primarily consists of service charges, rental income, fees
on deposits and loan products, increase in cash surrender value of life
insurance, and securities gains or losses. The Company's non-interest expenses
primarily consist of employee compensation and benefits, occupancy and equipment
expenses, data processing service fees, federal deposit insurance premiums, and
other operating expenses.

The Company's results of operations are also affected by general economic
conditions, the monetary and fiscal policies of Federal agencies and the
policies of agencies that regulate financial institutions. Future changes in
applicable laws, regulations or government policies may have a material impact
on the Company. Lending activities are influenced by the demand for real estate
loans and other types of loans, competition among lenders; the general level of
real estate values, the level of interest rates and the availability of funds.
Deposit flows and costs of funds are influenced by prevailing market interest
rates (including rates on non-deposit investment alternatives), account
maturities, and the levels of personal income and savings in the Company's
market area.

OPERATING STRATEGY. The Company's basic mission is to maintain its focus as
independent, community-oriented financial institution focused on serving
customers in its primary market area. The Board of Directors has sought to
accomplish this mission through an operating strategy designed to maintain
capital in excess of regulatory requirements and manage, to the extent
practical, the Company's loan delinquencies and vulnerability to changes in
interest rates. The key components of the Company's operating strategy are to:
(i) focus its lending operations on the origination of loans secured by
one-to-four-family residential real estate; (ii) supplement its
one-to-four-family residential lending activities with commercial real estate,
consumer, multi-family, commercial business, land and construction loans; (iii)
augment its lending activities with investments in purchased loans, leases,
mortgage-backed and other securities; (iv) emphasize adjustable rate and/or
short and medium duration assets when market conditions permit (v) build and
maintain its regular savings, transaction, money market and club accounts; and
(vi) increase, at a managed pace, to the extent practicable, the volume of the
Company's assets and liabilities.

Management and the Board of Directors of the Company have sought to enhance
shareholder value by using excess capital to repurchase outstanding shares when
business and market conditions warrant.

FORWARD-LOOKING STATEMENTS. When used throughout this document, the words or
phrases "will likely result," "are expected to," "will continue," "is
anticipated," "estimated," "projected," or similar expressions are intended to
identify "forward looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such statements are subject to certain
risks and uncertainties
                                        5
<PAGE>

including changes in economic conditions in the Bank's market area, changes in
policies by regulatory agencies, fluctuations in interest rates, demand for
loans and real estate values in the Bank's market area and competition, that
could cause actual results to differ materially from historical earnings and
those presently anticipated or projected. Factors listed above could affect the
Company's financial performance and could cause actual results for future
periods to differ materially from any statements expressed with respect to
future periods.

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

FINANCIAL CONDITION. Total assets of the Company decreased $3.7 million to
$146.0 million at December 31, 2003, from $149.7 million at December 31, 2002.
The primary reason for the decrease in total assets was a decrease in cash and
cash equivalents of $4.8 million to $3.7 million at December 31, 2003, from $8.5
million at December 31, 2002. The higher level of liquidity at December 31, 2002
reflected the increased cash flows from loan and mortgaged-backed security
repayments and deposit growth, which were used, both to help fund mortgage
originations and to repay a portion of borrowings which matured, primarily
during the third quarter of 2003.

Cash and short-term investments totaled a combined $7.2 million at December 31,
2003, a decrease of $5.2 million, from the combined balance of $12.4 million at
December 31, 2002. This redeployment of cash and cash equivalents was utilized
to assist in increasing loans receivable by $5.9 million, repaying $4.2 million
in borrowed money and funding a $1.0 million decline in deposit accounts.

Investment securities, available for sale, decreased by $3.6 million to $2.1
million at December 31, 2003. The decrease is due to $4.5 million in securities,
which were called or matured, and $1.3 million in sales and write-downs, offset
by $2.2 million in purchases. The purchases during the period were both U.S.
government agency and corporate debt obligations. Management reduced the
Company's investment securities due to the low prevailing interest yields. Net
unrealized gains in the available for sale portfolio declined to $21,000 at
December 31, 2003 from $119,000 at December 31, 2002.

Trading account securities decreased by $68,000 to $498,000 at December 31,
2003. The decrease is attributable to net sales and redemption activity of
$219,000 offset by both realized and unrealized gains from the portfolio of
$151,000. The increase in unrealized gain during the year of $130,000 relates to
the strong performance of the Company's trading portfolio, consisting primarily
of holdings in community bank and thrift stocks.

Mortgage-backed securities, available for sale, increased by $512,000 to $3.2
million at December 31, 2003. The increase is due to purchases of $2.3 million
offset by prepayments and amortization of $1.7 million. Net unrealized gains in
the available for sale portfolio declined to $69,000 at December 31, 2003 from
$130,000 at December 31, 2002.

Loans receivable increased $5.9 million, or 5.2%, to $120.2 million at December
31, 2003 from $114.3 million at December 31, 2002. The Bank originated loans of
$40.9 million and purchased loans totaling $11.1 million during the year ended
December 31, 2003, compared to $33.3 million of originations and $13.8 million
of purchases during the prior year. The higher loan origination volume was
primarily due to continued mortgage refinance activity due to the prevailing
interest rate environment. The purchase loans in the current year included $7.8
million in multi-family and non-residential loans, including $6.1 million in
out-of-state multi-family loans. These loans were purchased for their locality
and rate adjustability features. Offsetting the originations and purchases were
amortization and prepayments of loans totaling $45.8 million and $44.8 million
for the years ended December 31, 2003 and 2002.

The mortgage loan portfolio continues to consist primarily of one-to-four family
mortgage loans. The one-to-four family mortgage loans, which represented 64.4%
of the total loan portfolio at December 31, 2003, decreased $2.9 million to
$78.9 million at December 31, 2003 from $81.8 million at December 31, 2002.

                                        6
<PAGE>

This decrease was primarily due to the continued high level of loan repayments
as a result of refinance activity in the prevailing interest rate environment.
While the Bank continues to be primarily a one-to-four family mortgage lender,
an increased emphasis has been placed on multi-family and non-residential loan
originations. Multi-family loans, which tend to be less susceptible to
prepayment compared to one-to-four family loans, increased $6.9 million to $11.1
million at December 31, 2003 from $4.2 million at December 31, 2002. The
increase in multi-family loans is primarily attributable to the purchase of such
loans totaling $6.1 million located in California. Each such loan was
underwritten using the Company's normal standards. Non-residential loans
increased $3.7 million to $14.7 million at December 31, 2003 from the prior year
as a result of several large loan originations in the Company's local market
area during the year, primarily to acquire restaurant properties.

The allowance for loan losses totaled $1.0 million, an increase of $195,000 from
the $838,000 balance at December 31, 2002. The Bank's allowance for loan losses
to total loans outstanding was .85% at December 31, 2003, compared to .73% at
December 31, 2002. Non-performing loans increased $510,000 to $1.58 million, or
1.29% of total loans receivable at December 31, 2003, compared to $1.07 million,
or .91% of total loans receivable at December 31, 2002. The increase in
non-performing loans was primarily due to $145,000 in delinquent medical
equipment loans, $140,000 in delinquent land-improvement loans and $100,000 in
delinquent unsecured commercial loans. One related borrower accounted for
$286,000 of the increased delinquencies. The ratio of allowance for loan losses
to non-performing loans was 65.3% at December 31, 2003 compared to 78.2% at
December 31, 2002.

Deposits decreased $1.0 million, to $108.3 million at December 31, 2003 from
$109.3 million at December 31, 2002. The decrease in deposits is due to a
decline in certificates of deposit of $8.3 million offset by an increase in
non-certificate deposit accounts, primarily money market accounts, of $7.3
million. At December 31, 2003, the Bank's non-certificate deposits (passbook,
checking and money market accounts) comprise $44.4 million, or 41.0% of
deposits, compared to $37.1 million, or 33.9% of deposits at December 31, 2002.

Borrowed money, which consisted of FHLB of Indianapolis advances, decreased by
$4.2 million to $16.1 million at December 31, 2003 compared to $20.3 million at
December 31, 2002. The decrease in borrowed money reflects management's decision
to utilize excess cash flow to repay borrowings, which matured during the year.

In March 2002, the Company completed an issuance of $5.0 million of capital
trust securities. The securities were issued by a special purpose business trust
owned by the Company and sold to a pooled investment vehicle. The securities
have a maturity of 30 years and the holders will be entitled to receive
cumulative cash distributions at a variable annual rate, reset quarterly, equal
to three months LIBOR plus 3.60% In general, the securities will not be
redeemable for five years except in the event of certain special redemption
events.

Total stockholders' equity of the Company increased by $674,000 to $12.5
million, or 8.6% of total assets, at December 31, 2003, compared to $11.8, or
7.9% of total assets at December 31, 2002. The increase in stockholders' equity
was the result of net income of $1.2 million and the allocation of shares held
by the ESOP of $222,000, offset by the repurchase of common stock in the amount
of $457,000, cash dividends paid of $178,000 and a decline in other
comprehensive income, net of tax of $95,000. The Company intends, subject to
market conditions, to continue modest repurchases of its stock.

ANALYSIS OF NET INTEREST INCOME. Net interest income represents the difference
between interest earned on interest-earning assets and interest paid on
interest-bearing liabilities. Net interest income is affected by the relative
amounts of interest-earning assets and interest-bearing liabilities, and the
interest rates earned or paid on them.

The following table presents, for the periods indicated, the total dollar
amounts of interest income from average interest-earning assets and the
resultant yields, as well as the interest expense on average interest-bearing
liabilities, expressed both in dollars and rates. No tax equivalent adjustments
were made. All average balances were calculated using average daily balances and
include non-accruing loans.

                                        7
<PAGE>

                      ANALYSIS OF NET INTEREST INCOME TABLE



<TABLE><CAPTION>
                                                                       For theYear Ended December 31
                                                                           (Dollars in thousands)
                                      ---------------------------------------------------------------------------------------------
                                                    2003                             2002                             2001
                                      ---------------------------------------------------------------------------------------------
                                      Average     Interest             Average     Interest             Average     Interest
                                      Outstanding Earned/  Yield/      Outstanding Earned/  Yield/      Outstanding Earned/  Yield/
                                      Balance     Paid     Rate        Balance     Paid     Rate        Balance     Paid     Rate
<S>                                   <C>         <C>      <C>         <C>         <C>      <C>         <C>         <C>      <C>
ASSETS:
Interest-Earning Assets
   Loans receivable   (1)                 116,186    7,688   6.62%         111,748    8,132   7.28%         112,658    8,760   7.78%
   Mortgage-backed securities               3,181      174   5.40%           2,513      201   7.99%           3,181      252   7.93%
   Investment securities                    5,054      201   3.97%           6,179      274   4.44%           4,533      218   4.81%
   Interest-bearing deposits                8,036       88   1.09%           8,593      142   1.65%           4,038      149   3.69%
   FHLB stock                               1,652       84   5.12%           1,624       98   6.06%           1,624      121   7.44%
                                      --------------------             --------------------             --------------------
   Total interest-earning assets          134,109    8,235   6.14%         130,657    8,847   6.77%         126,034    9,500   7.54%
                                                 ---------                         --------                         --------
   Non-interest earning assets             17,024                           15,616                           13,623
                                      -----------                      -----------                      -----------
Total Assets                              151,133                          146,273                          139,657
                                      ===========                      ===========                      ===========


LIABILITIES AND STOCKHOLDERS EQUITY:
Interest-Bearing Liabilities
   Passbook accounts                       19,533      279   1.43%          16,815      334   1.99%          14,432      393   2.72%
   Demand and NOW accounts                 23,269      370   1.59%          18,432      303   1.64%          12,088      230   1.90%
   Certificate accounts                    69,395    2,015   2.90%          70,225    2,656   3.78%          71,288    4,129   5.79%
                                      --------------------             --------------------             --------------------
   Total deposits                         112,197    2,664   2.37%         105,472    3,293   3.12%          97,808    4,752   4.86%
   Borrowings                              18,154      988   5.44%          22,214    1,184   5.33%          27,309    1,541   5.64%
   Junior subordinated debentures           5,000      251   5.02%           3,750      216   5.76%
                                      --------------------             --------------------             --------------------
   Total interest-bearing liabilities     135,351    3,903   2.88%         131,436    4,693   3.57%         125,117    6,293   5.03%
                                                 ---------                         --------                         --------
   Non-interest liabilities                 3,624                            2,853                            3,270
                                      -----------                      -----------                      -----------
Total liabilities                         138,975                          134,289                          128,387
Stockholders equity                        12,158                           11,984                           11,270
                                      -----------                      -----------                      -----------
Total liabilities and stockholders
  equity                                  151,133                          146,273                          139,657
                                      ===========                      ===========                      ===========

Net interest income /
   net interest rate spread                          4,332   3.26%                    4,154   3.20%                    3,207   2.51%
                                                 ================                  ===============                  ===============

Net interest-earning assets /
   net interest margin                     (1,242)           3.23%            (779)           3.18%             917            2.54%
                                      ===========          =======================         ========================         =======

Ratio of interest-earning assets to
  interest bearing liabilities               .99x                             .99x                            1.01x
                                      ===========                      ===========                      ===========
</TABLE>

(1)  Calculated net of loans in process, deferred yield adjustments and
     allowance for loan losses.


                                        8
<PAGE>

The table below presents the extent to which changes in interest rates and
changes in the volume of interest-earning assets and interest bearing
liabilities have affected the Company's interest income and interest expense
during the period indicated. Information is provided in each category with
respect to (i) changes attributable to changes in rate (changes in rate
multiplied by prior volume), (ii) changes attributable to changes in volume
(changes in volume multiplied by prior rate), (iii) changes attributable to the
combined impact of volume and rate (changes in the rate multiplied by the
changes in the volume), and (iv) the net change. The changes attributable to the
combined impact of volume and rate have been allocated proportionately to the
changes due to volume and the changes due to rate.

                             Interest Volume Change
                             ----------------------
                         For the Year Ended December 31,
                         -------------------------------



<TABLE><CAPTION>
                                2003 Compared to 2002                           2002 Compared to 2001
                                Increase (Decrease) Due to                      Increase (Decrease) Due to
                                --------------------------                      --------------------------
                                                           Rate/                                           Rate/
                                   Rate        Volume      Volume        Net       Rate        Volume      Volume        Net
                                --------------------------------------------    --------------------------------------------
                                            (Dollars in thousands)                          (Dollars in thousands)
<S>                             <C>            <C>        <C>          <C>      <C>            <C>        <C>          <C>
Interest-earning assets:
Loans receivable, net           $   (738)        323         (29)       (444)       (561)        (71)          4        (628)
Mortgage-backed securities           (63)         53         (17)        (27)          2         (53)         --         (51)
Investment securities                (29)        (50)          6         (73)        (17)         79          (6)         56
Interest-bearing deposit             (48)         (9)          3         (54)        (82)        168         (93)         (7)
FHLB Stock                           (15)          1          --         (14)        (23)         --          --         (23)
                                --------    --------    --------    --------    --------    --------    --------    --------
     Totals                     $   (893)        318         (37)       (612)       (681)        123         (95)       (653)
                                ========    ========    ========    ========    ========    ========    ========    ========



Interest-bearing liabilities:
Passbook accounts               $    (94)         54         (15)        (55)       (106)         65         (18)        (59)
Demand and Now accounts               (9)         79          (3)         67         (31)        120         (16)         73
Certificate accounts                (618)        (31)          8        (641)     (1,433)        (61)         21      (1,473)
Borrowed funds                        24        (216)         (4)       (196)        (85)       (288)         16        (357)
Junor subordinated debendures        (28)         72          (9)         35          --          --         216         216
                                --------    --------    --------    --------    --------    --------    --------    --------
     Totals                     $   (725)        (42)        (23)       (790)     (1,655)       (164)        219      (1,600)
                                ========    ========    ========    ========    ========    ========    ========    ========

Net change in net interest income                                   $    178                                        $    947
                                                                    ========                                        ========

</TABLE>







                                        9
<PAGE>

COMPARISON OF THE RESULTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2003
AND 2002.

GENERAL. Net income for the year ended December 31, 2003 increased $181,000 to
$1.2 million from $1.0 million for the year ended December 31, 2002. For the
year ended December 31, 2003, diluted earnings per share increased to $1.18
million as compared to $.97 for the year ended December 31, 2002. The return on
average stockholders' equity improved to 9.72% during the year ended December
31, 2003, compared to 8.36% for the year ended December 31, 2002. Return on
average assets improved to .78% for the year ended December 31, 2003, compared
to .68% for the year ended December 31, 2002. Increased earnings were primarily
due to higher net interest income, a reduced loan loss provision, higher
revenues from fee income, increased earnings from trading securities and a loan
loss settlement received from the Bank of New York, offset by higher
non-interest expense and income taxes.

INTEREST INCOME. Total interest income decreased $612,000, or 6.9%, for the year
ended December 31, 2003 compared to the year ended December 31, 2002. This
decrease was the result of a decrease in the average yield on interest-earning
assets to 6.14% for the year ended December 31, 2003, from 6.77% for the year
ended December 31, 2002, offset by an increase of $3.5 million in the average
balance of interest-earning assets to $134.1 million for the year ended December
31, 2003, from $130.6 million for the year ended December 31, 2002. The decrease
in the average yield on interest-earning assets was due to the decreases in the
average yields on all asset categories. The decline in the federal funds rate
over the last several years continues to impact short-term as well as medium and
long-term interest rates and resulted in a lower interest rate environment
during the year ended December 31, 2003 than that which existed during the year
ended December 31, 2002. The increase in the average balance of interest-earning
assets was primarily due to increases in the average balance of loans
receivable.

Interest income on loans receivable decreased $444,000 to $7.7 million compared
to the prior year. The decline in interest rates resulted in a high level of
prepayments on higher yielding fixed-rate loans, which was a primary cause of a
66 basis point decline in the average yield on loans receivable. Interest income
on mortgage-backed securities, investment securities and interest-bearing
deposits all declined modestly between the years as a result of the general
decline in interest rates previously discussed.

INTEREST EXPENSE. Total interest expense decreased by $789,000, or 16.8%, for
the year ended December 31, 2003 compared to the year ended December 31, 2002.
This decrease was the result of a decrease in the average cost of
interest-bearing liabilities to 2.88% for the year ended December 31, 2003, from
3.57% for the year ended December 31, 2002, offset by an increase of $3.9
million in the average balance of interest-bearing liabilities to $135.3 million
for the year ended December 31, 2003, from $131.4 million for the year ended
December 31, 2002. The decrease in the overall average cost of interest-bearing
liabilities reflects the impact of the lower interest rate environment,
primarily on the cost of deposits. The increase in the average balance of
interest-bearing liabilities was due to increases in the average balance of
deposit accounts.

Interest expense on deposit accounts decreased by $629,000 to $2.7 million for
the year ended December 31, 2003, despite a $6.4 million increase in average
deposits compared to the prior year quarter. The 75 basis point decrease in the
average cost of deposits for the year ended December 31, 2003 compared to the
prior year was primarily due to the downward repricing of maturing certificate
of deposit accounts, as well as the lower interest rate paid on core deposits
due to the decline in short-term rates.

Interest expense on borrowings, including the Company's Guaranteed Preferred
Beneficial Interest in Junior Subordinated Debentures, decreased by $161,000 as
a result of a $2.8 million decrease in the average balance of borrowed funds as
well as a 4 basis point decrease in the average cost of borrowed funds. Higher
than normal liquidity due to prepayments of loans has enabled the Company to
repay maturing FHLB advances as they come due.

PROVISION FOR LOAN LOSSES. The Company establishes provisions for losses on
loans, which are charged to operations, in order to maintain the allowance for
losses on loans at a level, which is deemed appropriate to absorb losses
inherent in the portfolio. In determining the appropriate level of the allowance

                                       10
<PAGE>

for loan losses, management considers past and anticipated loss experience,
evaluations of real estate collateral, current and anticipated economic
conditions, volume and type of lending, and the levels of non-performing and
other classified loans. The amount of the allowance is based on estimates, and
ultimate losses may vary from such estimates. Management assesses the allowance
for losses on loans on a periodic basis and makes appropriate provisions to
maintain the adequacy of the allowance. The actual determination of the total
provision is the combination of specific reserves, which may be established from
time to time on individual classified assets, and a general reserve that is
based in part on certain ratios applied to various loan pools as stratified by
the Company, considering historical charge-offs and delinquency levels.

Based on management's assessment of the adequacy of the loan loss reserve, the
Company recorded a provision for loan losses of $214,000 for the year ended
December 31, 2003 compared to $392,000 in the prior year. There were no changes
in estimation method or assumptions that impacted the provision for loan losses
during the year. Net charge-offs were $19,000 and $320,000 during the years
ended December 31, 2003 and 2002, respectively. The increased provision in the
prior year relates to the Company's charge-off of medical lease loans in the
second quarter of 2002.

The Company's non-performing loans were $1.58 million at December 31, 2003
compared to $1.07 million at December 31, 2002. Included in non-performing loans
during both periods is a non-residential participation loan secured by a nursing
home located in Muncie, IN, in the process of foreclosure. The balance of this
loan was $485,000 at December 31, 2003. Management has authorized the
establishment of a specific valuation reserve against this loan in the amount of
$358,000. In addition, management has also authorized a $75,000 specific
valuation reserve against a commercial business loan, backed by medical
equipment, with a loan balance of $125,000. Although the Company believes it
maintains its allowance for loan losses at a level that it considers to be
adequate to cover probable accrued losses in the portfolio, there can be no
assurance that future losses will not exceed estimated amounts or that
additional provisions for loan losses will not be required in future periods.

NON-INTEREST INCOME. The Company's non-interest income increased $337,000 to
$1.7 million for the year ended December 31, 2003 compared to $1.3 million for
the year ended December 31, 2002. The increase in non-interest income was due in
part to increased fee income of $190,000, primarily ATM surcharge fees and loan
service fees, an increase of $94,000 from unrealized gains on the Company's
trading portfolio of community bank and thrift stocks, and a $92,000 settlement
received from the Bank of New York regarding losses on medical lease loans
charged off during 2002. These increases were offset by reduced rental income
from the Dyer office location of $69,000. The Dyer office location is currently
fully leased at an annual rent of $100,000.

In addition, the Company also recorded a loss of $90,000 and $88,000 for the
years ended December 31, 2003 and 2002, respectively, related to an investment
in a low-income housing joint venture. As a result of this investment, the
Company recorded an offsetting $140,000 in federal income tax credits during
both years, which resulted in the reduction of the Company's effective income
tax rate.

NON-INTEREST EXPENSE. The Company's non-interest expense increased $316,000 to
$4.0 million for the year ended December 31, 2003 compared to $3.7 million for
the year ended December 31, 2002. The increase in non-interest expense resulted
primarily from increased staffing costs of $160,000, due to normal salary and
benefit increases, increased bonus accruals and an increase in ESOP expense
attributable to the increase in the Company's stock price. In addition,
advertising increased by $16,000 due to increased spending related to mortgage
and deposit product promotions, occupancy and equipment expenses increased by
$30,000 due to increased repair and maintenance charges, data processing
increased by $36,000 due to increased transaction activity and other costs
increased by $57,000 due in part to increased security costs at all of the
Bank's locations.

INCOME TAXES. The Company recorded a provision for income taxes of $571,000, or
an effective tax rate of 32.6% for the year ended December 31, 2003 compared to
$376,000, or an effective rate of 27.3% for the year ended December 31, 2002.
Both periods were positively impacted by the recognition of approximately
$140,000 in low-income housing tax credits which have a greater impact on the
effective tax rate in a lower earnings period compared to a higher earnings
period.

                                       11
<PAGE>

COMPARISON OF OPERATING RESULTS FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001.

GENERAL. The Company reported net income of $1.0 million, or $1.02 basic
earnings per share and $.97 diluted earnings per share, for the year ended
December 31, 2002, compared to net income of $901,000, or $.89 basic earnings
per share and $.87 diluted earnings per share, for the year ended December 31,
2001. The return on average stockholders' equity improved to 8.36% during the
year ended December 31,2002, compared to 7.99% for the year ended December 31,
2001. Return on average assets improved to .68% for the year ended December 31,
2002, compared to .65% for the year ended December 31, 2001. Increased earnings
were primarily attributable to higher net interest income, due to an improved
net interest margin and increased balance of interest earning assets. The net
interest margin increased in 2002 to 3.18% from 2.54% during 2001. The Company's
margin increased primarily due to substantially lower interest rates paid on all
deposit products as well as the effects of including interest expense on the
trust preferred securities as non-interest expense.

INTEREST INCOME. Total interest income decreased $653,000, or 6.9% for the year
ended December 31, 2002 compared to the year ended December 31, 2001. Of this
decrease, $628,000 is attributable to interest earned on loans receivable. The
Bank's average yield on loans receivable declined by 50 basis points over the
prior year while the average balance of loans receivable remained stable. The
decline in the average rate was due to the impact of declining interest rates
and the downward repricing of the Company's loan portfolio since last year, as
lower interest rates have increased loan prepayments, and driven down new
origination rates. Interest income on mortgage-backed securities decreased by
$51,000 due to a decline of $668,000 in the average balance primarily due to
normal prepayments offset by a 6 basis point increase in average yield. The
$56,000 increase in interest income on investment securities was due to a $1.6
million increase in the average balance to $6.2 million, primarily from
purchases occurring during 2002, offset by a 37 basis point decline in average
yield. The $7,000 decrease in interest income on interest-bearing deposits for
the year ended December 31, 2002 was due to a decline in the average yield of
204 basis points as short term interest rates declined significantly between the
periods, offset by a $4.6 million increase in the average balance. This increase
in balances was due to the Company's issuance of $5.0 million in trust preferred
securities as well as increased deposit flows during the year and in case of
securities and deposits, higher than normal loan prepayments.

INTEREST EXPENSE. Total interest expense on interest-bearing liabilities
decreased $1.6 million, or 25.4% for the year ended December 31, 2002 compared
to the prior year. For the years ended December 31, 2002 and 2001, the Company's
average interest-bearing liabilities were $131.4 million and $125.1 million,
respectively, while the average cost on interest- bearing liabilities was 3.57%
and 5.03%. Interest expense on deposits decreased $1.5 million, primarily due to
a 174 basis point decrease in the average cost of deposits offset by a $7.7
million increase in balance of average deposits. The decrease in deposit costs
were primarily due to the downward repricing of certificates of deposit and the
increase that the Company has experienced in low-cost core deposits. Interest on
borrowings, including the Company's Guaranteed Preferred Beneficial Interest in
Junior Subordinated Debentures, decreased $141,000, reflecting a $1.3 million
decrease in the average balance of borrowed funds, primarily advances from the
FHLB of Indianapolis, and a 25 basis point decline in average cost.

PROVISION FOR LOAN LOSSES. A provision for loan losses is recorded as necessary
to maintain a loan loss reserve management considers adequate to provide
coverage for probable losses inherent in the Bank's loan portfolio. In
determining the appropriate level of the allowance for losses on loans,
management considers past and anticipated loss experience, evaluations of real
estate collateral, current and anticipated economic conditions, volume and type
of lending, and the levels of non-performing loans.

The Bank provided $392,000 for loan loss provision in 2002 compared to $152,000
in 2001. Net charge-offs were $320,000 and $87,000 in 2002 and 2001,
respectively. The increased provision in the current year relates to the Bank's
net charge-off of $308,000 of medical lease loans. At December 31, 2002, the

                                       12
<PAGE>

Bank's allowance for loan losses was $838,000, or 78.2% of non-performing loans
and .72% of total loans, compared to $766,000, or 61.0% of non-performing loans
and .66% of total loans.

Included in non-performing loans at December 31, 2002 is a $475,000
non-residential participation loan that is currently in the process of
foreclosure. Management has authorized the establishment of a specific valuation
reserve against this loan in the amount of $219,000. The $219,000 valuation
allowance is included in the above loan loss allowance. Although the Bank
believes it maintains its allowance for loan losses at a level that it considers
to be adequate, there can be no assurance that future losses will not exceed
estimated amounts or that additional provisions for loan losses will not be
required in future periods.

NON-INTEREST INCOME. The Company's non-interest income decreased $80,000 to $1.3
million for the year ended December 31, 2002 compared to $1.4 million for the
year ended December 31, 2001. Declines in gains on trading account securities
and reduced rental income from the Dyer branch office location were partially
offset by increased fee income. Both realized and unrealized gains on trading
account securities was $58,000 for year ended December 31, 2002, compared to
$167,000 for the prior year, a decrease of $109,000. Trading account securities
sales were $75,000 during 2002 resulting in realized gains of $22,000, compared
to $420,000 in sales during 2001, resulting in realized gains of $67,000. In
addition, unrealized gains on market adjustments of these securities were
$36,000 for the current year compared to $100,000 in the prior year.

The Company also recorded reduced rental income of $145,000 due to the
relocation of a major tenant at the Dyer branch office. The Company is currently
utilizing a portion of this space to house lending operations and is in the
process of remodeling the remaining space to lease. These declines were offset
by increased deposit related fee income of $54,000 due to increased minimum
balance and ATM fee charges and increased service fee income of $123,000
resulting from the Company's expansion in the purchase and management of
accounts receivable. At December 31, 2002, the balance of purchased accounts
receivable serviced by the Company stood at $1.9 million compared to $1.3
million at December 31, 2001. In addition, the Company also recorded a loss of
$88,000 during the year ended December 31, 2002 as compared to a loss of
$103,000 reported in the year ago period, related to an investment in a
low-income housing joint venture. As a result of this investment, the Company
recorded an offsetting $140,000 in federal income tax credits during both years,
which resulted in the reduction of the Company's effective income tax rate.

NON-INTEREST EXPENSE. The Company's non-interest expense increased $375,000 to
$3.7 million for the year ended December 31, 2002 compared to $3.3 million in
the prior year. The increase resulted primarily from increased staffing costs of
$245,000, due to normal salary and benefit increases, primarily pension benefit
costs. Advertising costs increased by $37,000 due to increased spending related
to mortgage and deposit product promotion while data processing costs increased
by $38,000 due to increased transaction activity. In addition, other operating
expenses increased by $58,000, due primarily to higher insurance costs and a
variety of other increased expenses.

INCOME TAXES. The Company recorded a provision for income taxes of $376,000 for
the year ended December 31, 2002, compared to $224,000 for the year ended
December 31, 2001. Both periods were positively impacted by the recognition of
low-income housing tax credits mentioned above provided through an investment in
a limited partnership organized to build, own and operate a 56 unit low-income
housing apartment complex.



                                       13
<PAGE>

QUALITATIVE AND QUANTITATIVE DISCLOSURE OF MARKET RISK

The principal objectives of the Company's interest rate risk management
activities are to: (i) define an acceptable level of risk based on the Company's
business focus, operating environment, capital and liquidity requirements, and
performance objectives; (ii) quantify and monitor the amount of interest rate
risk inherent in the asset/liability structure; and (iii) modify the Company's
asset/liability structure, as necessary, to manage interest rate risk and net
interest margins in changing rate environments. Management seeks to manage the
value of the Company's net portfolio value ("NPV") under different interest rate
scenarios and the ratio of interest rate sensitive assets to interest rate
sensitive liabilities within specified maturities or repricing periods. The
Company does not currently engage in the use of off-balance sheet derivative
instruments to control interest rate risk and management does not intend to
engage in such activity in the immediate future.

Notwithstanding the Company's interest rate risk management activities, the
potential for changing interest rates is an uncertainty that could have an
adverse effect on the earnings and net asset value of the Company. When
interest-bearing liabilities mature or reprice more quickly than
interest-earning assets in a given period, a significant increase in market
interest rates could adversely affect net interest income. Similarly, when
interest-earning assets mature or reprice including through prepayments more
quickly than interest-bearing liabilities and net asset value, falling interest
rates could result in a decrease in net interest income and net asset value.
Also, changes in interest rates often have an impact on the value of the
Company's financial assets. Finally, a flattening of the "yield curve" (i.e., a
narrowing of the spread between long- and short-term interest rates), could
adversely impact net interest income to the extent that the Company's assets
have a longer average term than its liabilities.

In managing the Company's asset/liability position, the Board and management
attempt to manage the Company's interest rate risk while enhancing net interest
margins. However, the Board of Directors generally believes that the increased
net interest income resulting from a mismatch in the maturity of the Company's
asset and liability portfolios can, during periods of declining or stable
interest rates and periods in which there is a substantial positive difference
between long- and short-term interest rates (i.e., a "positively sloped yield
curve"), can provide high enough returns to justify the increased exposure to
sudden and unexpected increases in interest rates. As a result, the Company's
results of operations and net portfolio values remain significantly vulnerable
to increases in interest rates and to fluctuations in the difference between
long- and short-term interest rates.

Consistent with its asset/liability management philosophy, the Company has taken
several steps to manage its interest rate risk. First, the Company maintains a
portfolio of interest rate sensitive loans. At December 31, 2003,
adjustable-rate or short term (three years or less) loans represented $44.2
million, or 36.0% of the total loan portfolio. As part of this philosophy,
during 2003 the Company significantly increased its acquisitions of multi-family
and non-residential loans. Such loans generally have shorter terms to repricing
than the Company's residential loans. Second, the Company has a substantial
amount of regular savings, transaction, money market and club accounts, which
may be less sensitive to changes in interest rates than certificate accounts. At
December 31, 2003, the Company had $19.9 million of regular savings accounts,
$14.1 million of money market accounts and $10.4 million of NOW, checking and
club accounts. Overall, these accounts comprised 41.0% of the Company's total
deposit base. Third, most of the mortgage-backed securities purchased by the
Company in recent years have had adjustable interest rates and/or short or
intermediate effective terms to maturity. Finally, a portion of the Company's
recent borrowings have terms to maturity or call of three years or more. At
December 31, 2003 $3.1 million or 19.4% of the Company's borrowings had terms to
maturity or call of three years or more.

One approach used by management to qualify interest rate risk is the NPV
analysis. NPV is generally considered to be the present value of the difference
between expected incoming cash flows on interest-earning and other assets and

                                       14
<PAGE>

expected outgoing cash flows on interest-bearing and other liabilities. This
approach attempts to quantify interest rate risk as the change in the NPV, which
would result from a theoretical 200 basis point (1 basis point equals .01%)
change in market interest rates.

Presented below, as of December 31, 2003, is an analysis of the Bank's interest
rate risk as measured by changes in NPV for instantaneous and sustained parallel
shifts of 100 basis points in market interest rates. As illustrated in the
table, the Bank's NPV is more sensitive to rising rates than declining rates.
From an overall perspective, such difference in sensitivity occurs principally
because, as rates rise, borrowers do not prepay fixed rate loans as quickly as
they do when interest rates are declining. Also, the interest the Bank would pay
on its deposits in the event of a rate increase would increase more rapidly than
the yield on its assets because the Bank's deposits generally have shorter
periods to repricing.

                INTEREST RATE SENSITIVITY OF NET PORTFOLIO VALUE

  Assumed Change                                            NPV as % of Present
in Interest Rates          Net Portfolio Value                Value of Assets
-----------------     ------------------------------       ---------------------
 (Basis Points)       $ Amount   $ Change   % Change       % Ratio     Bp Change
 --------------       --------   --------   --------       -------     ---------

     +300               12,562     -5,950        -32          8.74          -344
     +200               14,769     -3,743        -20         10.07          -211
     +100               16,821     -1,691         -9         11.26           -92
                        18,512                               12.18
     -100               19,003        491          3         12.37            19


Certain assumptions utilized by the OTS in assessing the interest rate risk of
thrift institutions were employed in preparing the preceding table. These
assumptions relate to interest rates, loan prepayment rates, deposit decay
rates, and the market values of certain assets under the various interest rate
scenarios. It was also assumed that delinquency rates would not change as a
result of changes in interest rates although there can be no assurance that this
will be the case. Even if interest rates change in the designated amounts, there
can be no assurance that the Bank's assets and liabilities would perform as set
forth above. In addition, a change in U.S. Treasury rates in the designated
amounts accompanied by a change in the shape of the Treasury yield curve would
cause significantly different changes to the NPVs indicated above.

Other types of market risk, such as foreign currency exchange risk and commodity
price risk, do not arise in the normal course of the Company's business
activities.

LIQUIDITY AND CAPITAL RESOURCES. The Company's primary sources of funds are
deposits, principal and interest payments on loans and securities and, to a
lesser extent, borrowings and proceeds from the sale of loans and securities.
While maturities and scheduled amortization of loans and securities provide a
relatively predictable flow of funds, other sources of funds such as loan
prepayments and deposit inflows are less predictable due to the effects of
changes in interest rates, economic conditions and competition.

The primary investing activity of the Company is the origination and purchase of
real estate and other loans. During the years ended December 31, 2003, and 2002,
the Company's disbursements for loan originations totaled $40.9 million, and

                                       15
<PAGE>

$33.3 million, respectively, and loan purchases totaled $11.1 million and $13.8
million, respectively.

For the year ended December 31, 2003, the Company experienced a net decrease in
deposits (including the effect of interest credited) of $1.0 million as compared
to a net increase in deposits of $7.1 million during 2002. New FHLB advances in
fiscal 2003 totaled $1.0 million and none in fiscal 2002. FHLB advances of $5.2
million and $3.7 million were repaid in fiscal 2003 and 2002, respectively.

The Company may borrow funds from the FHLB of Indianapolis subject to certain
limitations. Based on the level of qualifying collateral available to secure
advances, at December 31, 2003, the Company's borrowing limit from the FHLB of
Indianapolis was approximately $64.3 million, with unused borrowing capacity of
$46.7 million at that date.

The Company's most liquid assets are cash and cash equivalents, which include
highly liquid short-term investments (such as money market mutual funds) that
are readily convertible to known amounts of cash. The level of these assets is
dependent on the Company's operating, financing and investing activities during
any given period. At December 31, 2003 and 2002, cash and cash equivalents
totaled $7.2 million and $12.4 million, respectively.

At December 31, 2003, the Company had outstanding loan origination commitments
of $3.8 million, undisbursed loans in process of $1.4 million and approved but
unused lines of credit of $5.8 million. The Company anticipates that it will
have sufficient funds available to meet its current loan origination and other
commitments. Certificates of deposit scheduled to mature in one year or less
from December 31, 2003 totaled $50.1 million. Based on the Company's most recent
experience and pricing strategy, management believes that a significant portion
of such deposits will remain with the Company.

The OTS capital regulations require savings institutions to meet two minimum
capital standards: a 3% leverage (core capital) ratio and an 8% risk-based
capital ratio. The Bank satisfied these minimum capital standards at December
31, 2003 with a leverage capital ratio of 8.78% and a total risk-based capital
ratio of 15.23%. In determining the amount of risk-weighted assets for purposes
of the risk-based capital requirement, a savings institution must compute its
risk-based assets by multiplying its assets and certain off-balance sheet items
by risk-weights, which range from 0% for cash and obligations issued by the
United States Government or its agencies to 100% for consumer and commercial
loans, as assigned by the OTS capital regulations. These capital requirements,
which are applicable to the Bank only, do not consider additional capital held
at the Company level, and require certain adjustments to stockholder's equity to
arrive at the various regulatory capital amounts.

The Bank may not declare or pay cash dividends on or repurchase any of its
shares of common stock if the effect thereof would cause equity to be reduced
below applicable regulatory capital requirements or the amount required to be
maintained for the liquidation account established in connection with the
Conversion. The Bank did not pay a dividend to the Company during the years
ended December 31, 2003, and 2002 compared to a $100,000 dividend paid in 2001.
Unlike the Bank, the Company is not subject to OTS regulatory restrictions on
the payment of dividends to its shareholders; however, it is subject to the
requirements of Delaware law. Delaware law generally limits dividends to an
amount equal to the excess of the net assets of the Company (the amount by which
total assets exceed total liabilities) over its statutory capital, or if there
is no such excess, to its profits for the current and/or immediately preceding
fiscal year.

IMPACT OF INFLATION AND CHANGING PRICES.

The consolidated financial statements and related data presented herein have
been prepared in accordance with GAAP, which require the measurement of
financial position and operating results in terms of historical dollars without
considering the changes in the relative purchasing power of money over time due
to inflation. The impact of inflation is reflected in the increased cost of the
Company's operations. Unlike industrial companies, nearly all of the assets and
liabilities of the Company are monetary in nature. As a result, interest rates
have a greater impact on the Company's performance than do the effects of
general levels of inflation. Interest rates do not necessarily move in the same
direction or to the same extent as the price of goods and services.

                                       16
<PAGE>

IMPACT OF NEW ACCOUNTING STANDARDS

In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity". This Statement
established standards for how an issuer classifies and measures certain
financial instruments with characteristics of both liabilities and equity. This
Statement is effective for financial instruments entered into or modified after
May 31, 2003, and otherwise is effective at the beginning of the first interim
period beginning after June 15, 2003. The Company adopted SFAS No. 150 on July
1, 2003 and has reclassified its "Guaranteed Preferred Beneficial Interest in
Subordinated Debentures" as long-term debt and the corresponding expense as
interest on borrowings. As a result, interest expense, net interest income and
other expenses have been reclassified from prior year periods to conform to
current presentation. This change has no impact on current or previously issued
consolidated statements of financial condition or results of operations,
including net earnings and earnings per share.

The foregoing does not constitute a comprehensive summary of all material
changes or developments affecting the manner in which the Company keeps its
books and records and performs its financial accounting responsibilities. It is
intended only as a summary of some of the recent pronouncements made by the
FASB, which are of particular interest to financial institutions.































                                       17
<PAGE>

                 [LETTERHEAD OF COBITZ, VANDENBERG & FENNESSY]

                          INDEPENDENT AUDITORS' REPORT


     The Board of Directors
     AMB Financial Corp.

            We have audited the consolidated statements of financial condition
     of AMB Financial Corp. and subsidiaries as of December 31, 2003 and 2002,
     and the related consolidated statements of income, changes in stockholders'
     equity and cash flows for each of the three years in the period ending
     December 31, 2003. These consolidated financial statements are the
     responsibility of the Company's management. Our responsibility is to
     express an opinion on these consolidated financial statements based on our
     audits.

            We conducted our audits in accordance with auditing standards
     generally accepted in the United States of America. Those standards require
     that we plan and perform the audit to obtain reasonable assurance about
     whether the consolidated financial statements are free of material
     misstatements. An audit includes examining, on a test basis, evidence
     supporting the amounts and disclosures in the consolidated financial
     statements. An audit also includes assessing the accounting principles used
     and significant estimates made by management, as well as evaluating the
     overall consolidated financial statement presentation. We believe that our
     audits provide a reasonable basis for our opinion.

            In our opinion, the consolidated financial statements referred to
     above present fairly, in all material respects, the financial position of
     AMB Financial Corp. and subsidiaries at December 31, 2003 and 2002, and the
     results of their operations and their cash flows for each of the three
     years in the period ending December 31, 2003, in conformity with accounting
     principles generally accepted in the United States of America.




     /s/ COBITZ, VANDENBERG & FENNESSY
     ---------------------------------------
     January 16, 2004
     Palos Hills, Illinois


                                       18
<PAGE>
                               AMB FINANCIAL CORP.
                                AND SUBSIDIARIES
                                ----------------
<TABLE><CAPTION>
                 Consolidated Statements of Financial Condition

                                                                                              December 31,
                                                                                     ------------------------------
                                                                                          2003             2002
                                                                                     -------------    -------------
<S>                                                                                  <C>              <C>
Assets

Cash and amounts due from depository institutions                                    $   3,574,488        3,848,575
Interest-bearing deposits                                                                3,660,301        8,503,927
                                                                                     -------------    -------------
     Total cash and cash equivalents                                                     7,234,789       12,352,502
Investment securities, available for sale, at fair value (note 2)                        2,147,354        5,764,121
Trading securities (note 3)                                                                498,428          565,928
Mortgage-backed securities, available for sale, at fair value (note 4)                   3,155,454        2,643,219
Loans receivable (net of allowance for loan losses:
   2003 - $1,033,226; 2002 - $837,859) (note 5)                                        120,208,826      114,318,331
Real estate owned                                                                             --            104,197
Investment in limited partnership (note 6)                                                 951,998        1,042,600
Stock in Federal Home Loan Bank of Indianapolis, at cost                                 1,687,200        1,624,400
Accrued interest receivable (note 7)                                                       621,067          703,927
Office properties and equipment - net (note 8)                                           2,553,884        2,425,525
Bank owned life insurance                                                                3,314,147        3,162,721
Prepaid expenses and other assets (note 9)                                               3,591,650        4,964,064
                                                                                     -------------    -------------

     Total assets                                                                      145,964,797      149,671,535
                                                                                     =============    =============


Liabilities and Stockholders' Equity

Liabilities:

Deposits (note 10)                                                                     108,334,324      109,330,981
Borrowed money (note 11)                                                                16,129,714       20,296,899
Junior subordinated debentures (note 12)                                                 5,000,000        5,000,000
Note payable                                                                               769,593          927,043
Advance payments by borrowers for taxes and insurance                                      709,515          406,372
Other liabilities (note 13)                                                              2,502,042        1,864,420
                                                                                     -------------    -------------
     Total liabilities                                                                 133,445,188      137,825,715
                                                                                     -------------    -------------

Stockholders' Equity:

Preferred stock, $.01 par value: authorized 100,000 shares; none outstanding                  --               --
Common stock, $.01 par value: authorized 1,900,000 shares; 1,686,169 shares
   issued and 949,379 shares outstanding at December 31, 2003 and 987,004
   shares outstanding at December 31, 2002                                                  16,862           16,862
Additional paid-in capital                                                              11,066,882       10,932,458
Retained earnings, substantially restricted                                              9,006,790        9,922,705
Accumulated other comprehensive income, net of income taxes                                 54,067          149,543
Treasury stock, at cost (736,790 and 699,165 shares at December 31, 2003 and 2002)      (7,445,132)      (8,905,958)
Common stock acquired by Employee Stock Ownership Plan                                    (179,860)        (269,790)
                                                                                     -------------    -------------
     Total stockholders' equity (notes 17 and 18)                                       12,519,609       11,845,820
                                                                                     -------------    -------------

Commitments and contingencies (notes 19 and 20)
     Total liabilities and stockholders' equity                                      $ 145,964,797      149,671,535
                                                                                     =============    =============

See accompanying notes to consolidated financial statements.
</TABLE>
                                       19
<PAGE>

<TABLE><CAPTION>
                               AMB FINANCIAL CORP.
                                AND SUBSIDIARIES
                                ----------------

                        Consolidated Statements of Income

                                                                    Years Ended December 31,
                                                           -----------------------------------------
                                                               2003           2002           2001
                                                           -----------    -----------      ---------
<S>                                                        <C>            <C>              <C>
Interest income:
  Interest on loans                                        $ 7,687,977      8,131,998      8,759,718
  Interest on mortgage-backed securities                       173,820        200,815        252,339
  Interest on investment securities                            200,850        274,428        218,090
  Interest on interest-bearing deposits                         87,700        141,599        149,093
  Dividends on Federal Home Loan Bank stock                     84,646         98,476        120,751
                                                           -----------    -----------    -----------
     Total interest income                                   8,234,993      8,847,316      9,499,991
                                                           -----------    -----------    -----------
Interest expense:
  Interest on deposits                                       2,664,347      3,293,445      4,751,519
  Interest on borrowings                                     1,239,182      1,399,423      1,541,412
                                                           -----------    -----------    -----------
     Total interest expense                                  3,903,529      4,692,868      6,292,931
                                                           -----------    -----------    -----------

     Net interest income                                     4,331,464      4,154,448      3,207,060
Provision for loan losses (note 5)                             213,604        392,027        152,303
                                                           -----------    -----------    -----------
     Net interest income after provision for loan losses     4,117,860      3,762,421      3,054,757
                                                           -----------    -----------    -----------
Non-interest income:
  Loan fees and service charges                                243,964        184,587        150,884
  Deposit related fees                                         567,039        489,075        435,230
  Other fee income                                             369,931        317,211        193,521
  Rental income                                                 76,822        145,550        290,081
  Unrealized gain on trading securities - net                  130,209         36,120         99,611
  Gain on sale of trading securities                            21,082         21,563         67,013
  Gain on sale of investment securities                         28,937           --           17,781
  Gain (loss) on sale of real estate owned                      24,047        (28,114)          --
  Loss from limited partnership (note 6)                       (90,602)       (87,683)      (103,489)
  Increase in cash surrender value of life insurance           151,427        157,613        155,821
  Loan loss settlement                                          92,261           --             --
  Other income                                                  56,544         99,063        108,156
                                                           -----------    -----------    -----------
     Total non-interest income                               1,671,661      1,334,985      1,414,609
                                                           -----------    -----------    -----------
Non-interest expense:
  Staffing costs (notes 14 and 15)                           1,959,331      1,799,088      1,554,040
  Advertising                                                  109,688         93,883         57,073
  Occupancy and equipment expenses (note 8)                    471,210        441,133        464,972
  Data processing                                              520,771        484,709        447,024
  Professional fees                                            248,002        231,027        209,613
  Federal deposit insurance premiums                            18,119         18,290         18,177
  Other                                                        709,103        651,918        593,985
                                                           -----------    -----------    -----------
     Total non-interest expense                              4,036,224      3,720,048      3,344,884
                                                           -----------    -----------    -----------

Income before income taxes                                   1,753,297      1,377,358      1,124,482
  Income taxes (note 16)                                       571,042        376,027        223,591
                                                           -----------    -----------    -----------

     Net income                                            $ 1,182,255      1,001,331        900,891
                                                           ===========    ===========    ===========
Earnings per share -
     Basic                                                 $      1.31           1.02            .89
     Diluted                                               $      1.18            .97            .87
</TABLE>
See accompanying notes to consolidated financial statements.

                                       20
<PAGE>

<TABLE><CAPTION>
                               AMB FINANCIAL CORP.
                                AND SUBSIDIARIES
                                ----------------
           Consolidated Statements of Changes in Stockholders' Equity
                       Three Years Ended December 31, 2003
                                                                        Accumulated                Common      Common
                                               Additional                  Other                    Stock       Stock
                                   Common       Paid-in     Retained   Comprehensive   Treasury    Acquired    Awarded
                                    Stock       Capital     Earnings       Income       Stock       by ESOP     by RRP     Total
                                  --------    ----------    ---------   ---------     ----------   --------   ---------  ----------
<S>                              <C>         <C>           <C>            <C>        <C>          <C>         <C>       <C>
Balance at December 31, 2000      $ 16,862    10,822,244    8,404,133      68,462     (7,266,212)  (449,650)   (96,488)  11,499,351

Comprehensive income:
 Net income                                                   900,891                                                       900,891
 Other comprehensive income,
  net of tax:
   Unrealized holding gain
    during the year                                                        62,249                                            62,249
   Less: Reclassification
    adjustment of gains
    included in net income                                                 (2,272)                                           (2,272)
                                  --------    ----------    ---------   ---------     ----------   --------   ---------  ----------
Total comprehensive income                                    900,891      59,977                                           960,868

Purchase of treasury stock
 (98,015 shares)                                                                        (777,286)                          (777,286)
Amortization of award of
 RRP stock                                                                                                      96,488       96,488
Tax benefit related to vested RRP
 stock                                             2,445                                                                      2,445
Contribution to fund ESOP loan                    39,682                                             89,930                 129,612
Dividends declared on
 common stock ($.192 per share)                              (194,038)                                                     (194,038)
                                  --------    ----------    ---------   ---------     ----------   --------   ---------  ----------
Balance at December 31, 2001        16,862    10,864,371    9,110,986     128,439     (8,043,498)  (359,720)       --    11,717,440
                                  --------    ----------    ---------   ---------     ----------   --------   ---------  ----------
Comprehensive income:
 Net income                                                 1,001,331                                                     1,001,331
 Other comprehensive income,
  net of tax:
  Unrealized holding gain during
   the year                                                                21,104                                            21,104
                                  --------    ----------    ---------   ---------     ----------   --------   ---------  ----------
Total comprehensive income                                  1,001,331      21,104                                         1,022,435

Purchase of treasury stock
(89,250 shares)                                                                         (862,460)                          (862,460)
Contribution to fund ESOP loan                    68,087                                             89,930                 158,017
Dividends declared on
 common stock ($.192 per share)                              (189,612)                                                     (189,612)
                                  --------    ----------    ---------   ---------     ----------   --------   ---------  ----------
Balance at December 31, 2002        16,862    10,932,458    9,922,705     149,543     (8,905,958)  (269,790)       --    11,845,820
                                  --------    ----------    ---------   ---------     ----------   --------   ---------  ----------
Comprehensive income:
 Net income                                                 1,182,255                                                     1,182,255
 Other comprehensive income,
  net of tax:
  Unrealized holding loss
   during the year                                                        (60,894)                                          (60,894)
   Less: Reclassification
     adjustment of gains
     included in net income                                               (34,582)                                          (34,582)
                                  --------    ----------    ---------   ---------     ----------   --------   ---------  ----------
Total comprehensive income                                  1,182,255     (95,476)                                        1,086,779

Purchase of treasury stock
  (37,625 shares)                                                                       (457,240)                          (457,240)
Contribution to fund ESOP loan                   132,525                                                        89,930      222,455
Dividends declared on
   common stock ($.196 per share)                            (177,153)                                                     (177,153)
25% stock dividend, including
   impact of fractional shares                     1,899   (1,921,017)                 1,918,066                             (1,052)
                                  --------    ----------    ---------   ---------     ----------  ---------   ---------  ----------
Balance at December 31, 2003      $ 16,862    11,066,882    9,006,790      54,067     (7,445,132)  (179,860)       --    12,519,609
                                  ========    ==========    =========   =========     ==========  =========   =========  ==========
</TABLE>
See accompanying notes to consolidated financial statements.

                                       21
<PAGE>
                               AMB FINANCIAL CORP.
                                AND SUBSIDIARIES
                                ----------------
                      Consolidated Statements of Cash Flows
<TABLE><CAPTION>
                                                                       Years Ended December 31,
                                                            --------------------------------------------
                                                                 2003            2002            2001
                                                            ------------    ------------    ------------
<S>                                                         <C>             <C>             <C>
Cash flows from operating activities:
 Net income                                                 $  1,182,255       1,001,331         900,891
 Items not requiring (providing) cash:
   Depreciation                                                  184,060         183,855         198,641
   Amortization of cost of stock benefit plans                    89,930          89,930         186,418
   Amortization of premiums and accretion of discounts            29,962          (9,886)          1,332
   Federal Home Loan Bank stock dividend                         (62,800)           --              --
   Net gains on sale of securities                               (50,019)        (21,563)        (84,794)
   Net (gain) loss on sale of real estate owned                  (24,047)         28,114            --
   Provision for loan losses                                     213,604         392,027         152,303
   Loss from limited partnership                                  90,602          87,683         103,489
   Increase in cash surrender value of life insurance           (151,427)       (157,613)       (155,821)
   Unrealized gain on trading securities                        (130,209)        (36,120)        (99,611)
   Proceeds from sale of trading securities                      219,957          75,000         519,537
   Purchase of trading account securities                         (1,166)           --              --
   Increase in deferred income on loans                           74,997           4,517          11,855
   Increase in accrued and deferred income taxes                 211,834         193,527          83,591
   Decrease (increase) in accrued interest receivable             82,860         (15,837)         32,880
   Decrease in accrued interest payable                          (19,124)        (23,505)        (53,020)
   Decrease (increase) in purchased accounts receivable        1,515,128        (534,313)     (2,772,656)
   Increase in deferred compensation                              82,029          88,915          83,360
   Other, net                                                    416,346        (728,765)        448,271
                                                            ------------    ------------    ------------

Net cash provided by (for) operating activities                3,954,772         617,297        (443,334)
                                                            ------------    ------------    ------------
Cash flows from investing activities:
   Proceeds from sales of investment securities                1,198,074            --           519,933
   Proceeds from maturities of investment securities           4,500,000       3,750,000         500,000
   Purchase of investment securities                          (2,185,124)     (6,024,382)       (505,390)
   Proceeds from repayments of mortgage-backed securities      1,732,082       1,421,032         947,688
   Purchase of mortgage-backed securities                     (2,300,651)     (1,002,554)       (499,941)
   Purchase of loans                                         (11,133,952)    (13,819,376)    (10,466,840)
   Loan disbursements                                        (40,863,047)    (33,281,795)    (29,923,793)
   Loan repayments                                            45,755,092      44,795,495      40,158,524
   Proceeds from sale of real estate owned                       191,055         162,467            --
   Property and equipment expenditures, net                     (312,419)       (432,613)       (124,141)
                                                            ------------    ------------    ------------

Net cash provided (for) by investing activities               (3,418,890)     (4,431,726)        606,040
                                                            ------------    ------------    ------------
Cash flows from financing activities:
   Net (decrease) increase in deposits                          (996,657)      7,120,836      12,498,425
   Proceeds from borrowed money                                1,000,000            --        14,000,000
   Repayment of borrowed money                                (5,167,185)     (3,658,939)    (21,152,296)
   Repayment of notes payable                                   (157,450)       (159,107)       (173,938)
   Proceeds from issuance of capital trust securities               --         5,000,000            --
   Increase (decrease) in advance payments by
     borrowers for taxes and insurance                           303,142         (46,446)        (15,446)
   Purchase of treasury stock                                   (457,240)       (862,460)       (777,286)
   Dividends paid on common stock                               (178,205)       (189,612)       (194,038)
                                                            ------------    ------------    ------------

Net cash provided (for) by financing activities               (5,653,595)      7,204,272       4,185,421
                                                            ------------    ------------    ------------

Net change in cash and cash equivalents                       (5,117,713)      3,389,843       4,348,127
Cash and cash equivalents at beginning of year                12,352,502       8,962,659       4,614,532
                                                            ------------    ------------    ------------

Cash and cash equivalents at end of year                    $  7,234,789      12,352,502       8,962,659
                                                            ============    ============    ============
Supplemental disclosure of cash flow information:
  Cash paid during the year for:
        Interest                                            $  3,922,653       4,716,373       6,345,951
        Income taxes                                             359,208         182,500         140,000
    Non-cash investing activities:
        Transfer of loans to real estate owned              $     62,811         104,197         190,581
</TABLE>
See accompanying notes to consolidated financial statements.

                                       22
<PAGE>

                               AMB FINANCIAL CORP.
                                AND SUBSIDIARIES
                                ----------------

                   Notes to Consolidated Financial Statements

1)       Summary of Significant Accounting Policies
         ------------------------------------------
         AMB Financial Corp. (the "Company") is a Delaware corporation
         incorporated on November 23, 1993 for the purpose of becoming the
         savings and loan holding company for American Savings, FSB (the
         "Bank"). On March 29, 1996, the Bank converted from a mutual to a stock
         form of ownership, and the Company completed its initial public
         offering, and, with a portion of the net proceeds acquired all of the
         issued and outstanding capital stock of the Bank (the "Conversion").

         The accounting and reporting policies of the Company and its
         subsidiaries conform to generally accepted accounting principles and to
         general practice within the thrift industry. The preparation of
         financial statements in conformity with accounting principles generally
         accepted in the United States of America requires management to make
         estimates and assumptions that affect the reported amounts of assets
         and liabilities and disclosure of contingent assets and liabilities at
         the date of the financial statements and the reported amounts of
         revenue and expenses during the reporting period. Actual results could
         differ from those estimates. The following is a description of the more
         significant policies which the Bank follows in preparing and presenting
         its consolidated financial statements.

         Principles of Consolidation
         ---------------------------
         The accompanying consolidated financial statements consist of the
         accounts of the Company, and its wholly owned subsidiary, American
         Savings FSB, the Bank's wholly owned subsidiary, NIFCO, Inc. and the
         wholly owned subsidiary of NIFCO, Inc., Ridge Management, Inc.
         Significant intercompany balances and transactions have been eliminated
         in consolidation.

         Industry Segments
         -----------------
         The Company operates principally in the banking industry through its
         subsidiary bank. As such, substantially all of the Company's revenues,
         net income, identifiable assets and capital expenditures are related to
         banking operations.

         Investment Securities and Mortgage-Backed Securities, Available for
         -------------------------------------------------------------------
         Sale
         ----
         Investment securities and mortgage-backed securities available for sale
         are recorded in accordance with Statement of Financial Accounting
         Standards ("SFAS") No. 115 "Accounting for Certain Investments in Debt
         and Equity Securities". SFAS No. 115 requires the use of fair value
         accounting for securities available for sale or trading and retains the
         use of the amortized cost method for investments the Company has the
         positive intent and ability to hold to maturity.

         SFAS No. 115 requires the classification of debt and equity securities
         into one of three categories: held to maturity, available for sale, or
         trading. Held to maturity securities are measured at amortized cost.
         Unrealized gains and losses on trading securities are included in
         income. Unrealized gains and losses on available for sale securities
         are excluded from income and reported net of taxes as a separate
         component of stockholders' equity.

         The Company has currently designated all of its investment securities
         and mortgage-backed securities as available for sale and has recorded
         these investments at their current fair values. Unrealized gains and
         losses are recorded in a valuation account which is included, net of
         income taxes, as a separate component of stockholders' equity. Gains
         and losses on the sale of securities are determined using the specific
         identification method and are reflected in earnings when realized.

                                       23
<PAGE>

1)       Summary of Significant Accounting Policies (continued)
         -----------------------------------------------------

         Trading Securities
         ------------------
         Trading account securities are recorded at fair value. Realized and
         unrealized gains and losses on trading account securities are reflected
         in non-interest income in the consolidated statements of income.

         Loans Receivable and Related Fees
         ---------------------------------
         Loans are stated at the principal amount outstanding, net of loans in
         process, deferred yield adjustment and the allowance for losses.
         Interest on loans is credited to income as earned and accrued only if
         deemed collectible. Loans are placed on nonaccrual status when, in the
         opinion of management, the full timely collection of principal or
         interest is in doubt. As a general rule, the accrual of interest is
         discontinued when principal or interest payments become 90 days past
         due or earlier if conditions warrant. When a loan is placed on
         nonaccrual status, previously accrued but unpaid interest is charged
         against current income.

         Loan origination fees and certain direct loan origination costs are
         being deferred in accordance with SFAS No. 91 "Accounting for
         Nonrefundable Fees and Costs Associated with Originating or Acquiring
         Loans and Initial Direct Costs of Leases". This statement requires that
         loan origination fees and direct loan origination costs for a completed
         loan be netted and then deferred and amortized into interest income as
         an adjustment of yield over the contractual life of the loan.

         The Company has adopted the provisions of SFAS No. 114 "Accounting by
         Creditors for Impairment of a Loan" and SFAS No. 118 "Accounting by
         Creditors for Impairment of a Loan - Income Recognition and
         Disclosures". These statements apply to all loans that are identified
         for evaluation except for large groups of smaller-balance homogeneous
         loans that are collectively evaluated for impairment. These loans
         include, but are not limited to, credit card, residential mortgage and
         consumer installment loans. Of the remaining loans which are evaluated
         for impairment, management has determined that there were no material
         amounts of loans which met the definition of an impaired loan during
         the years ended December 31, 2003 and 2002 and two loans to be
         evaluated for impairment at December 31, 2003.

         Allowance for Loan Losses
         -------------------------
         The determination of the allowance for loan losses involves material
         estimates that are susceptible to significant change in the near term.
         The allowance for loan losses is maintained at a level adequate to
         provide for losses through charges to operating expense. The allowance
         is based upon past loss experience and other factors which, in
         management's judgement, deserve current recognition in estimating
         losses. Such other factors considered by management include growth and
         composition of the loan portfolio, the relationship of the allowance
         for losses to outstanding loans and economic conditions.

         Management believes that the allowance is adequate. While management
         uses available information to recognize losses on loans, future
         additions to the allowance may be necessary based on changes in
         economic conditions. In addition, various regulatory agencies, as an
         integral part of their examination process, periodically review the
         Bank's allowance for losses. Such agencies may require the Bank to
         recognize additions to the allowance based on their judgements about
         information available to them at the time of their examination.

         Real Estate Owned
         -----------------
         Real estate acquired through foreclosure or deed in lieu of foreclosure
         is carried at the lower of fair value minus estimated costs to sell or
         the related loan balance at the date of foreclosure. Valuations are
         periodically performed by management and an allowance for loss is
         established by a charge to operations if the carrying value of a
         property exceeds its fair value minus estimated costs to sell.

                                       24
<PAGE>

1)       Summary of Significant Accounting Policies (continued)
         ------------------------------------------------------

         Depreciation and Amortization
         -----------------------------
         Depreciation of office properties and equipment is accumulated on the
         straight line basis over estimated lives of the various assets. Useful
         lives are 25 to 40 years for office properties and 3 to 10 years for
         furniture, fixtures and equipment.

         Investment in Limited Partnership
         ---------------------------------
         The investment in limited partnership is recorded using the equity
         method of accounting. Losses due to impairment are recorded when it is
         determined that the investment no longer has the ability to recover its
         carrying amount. The benefits of low income housing tax credits
         associated with the investment are accrued when earned.

         Income Taxes
         ------------
         The Company files a consolidated federal income tax return with the
         Bank. The provision for federal and state taxes on income is based on
         earnings reported in the financial statements. Deferred income taxes
         arise from the recognition of certain items of income and expense for
         tax purposes in years different from those in which they are recognized
         in the consolidated financial statements. Deferred tax assets and
         liabilities are recognized for the estimated future tax consequences
         attributable to differences between the financial statement carrying
         amount of existing assets and liabilities and their respective tax
         bases. Deferred tax assets and liabilities are measured using tax rates
         in effect for the year in which those temporary differences are
         expected to be recovered or settled. The effect on deferred tax assets
         and liabilities of a change in tax rates is recognized in income for
         the period that includes the enactment date.

         Consolidated Statements of Cash Flows
         -------------------------------------
         For the purposes of reporting cash flows, the Company has defined cash
         and cash equivalents to include cash on hand, amounts due from
         depository institutions, interest-bearing deposits in other financial
         institutions and federal funds sold.

         Stockholders' Equity
         --------------------
         On April 23, 2003, the Board of Directors of AMB Financial Corp.
         approved a 5 for 4 stock split effective in a form of a stock dividend
         which was payable on May 29, 2003 to stockholders of record on May 14,
         2003. Accordingly, stockholders of record received one additional share
         for every four shares owned as of May 14, 2003. All prior share related
         information has been restated to reflect the stock split effect,
         including earnings per share data.

                                       25
<PAGE>

1)       Summary of Significant Accounting Policies (continued)
         ------------------------------------------------------

         Earnings Per Share
         ------------------
         Basic earnings per share is computed by dividing net income by the
         weighted average number of shares outstanding for the period. ESOP
         shares not committed to be released are not considered to be
         outstanding. Stock options are regarded as future common stock and are
         considered in the earnings per share calculations and are the only
         other adjustments made in computing diluted earnings per share.

         Weighted average shares used in calculating earnings per share are
         summarized below.
<TABLE><CAPTION>
                                                                    Years Ended December 31,
                                                          -----------------------------------------
                                                              2003           2002           2001
                                                          -----------    -----------    -----------
<S>                                                       <C>            <C>            <C>
          Weighted average number of common shares
              outstanding used in basic EPS calculation       954,485      1,045,628      1,094,185
          Reduction for common shares not yet
              released by Employee Stock Ownership Plan       (50,202)       (66,934)       (83,666)
                                                          -----------    -----------    -----------
          Total weighted average common shares
              outstanding for basic computation               904,283        978,694      1,010,519
          Add common stock equivalents for shares
              issuable under Stock Option Plans               100,611         51,604         21,649
                                                          -----------    -----------    -----------
          Weighted average number of shares outstanding
              adjusted for common stock equivalents         1,004,894      1,030,298      1,032,168
                                                          ===========    ===========    ===========

          Net income                                      $ 1,182,255      1,001,331        900,891
          Basic earnings per share                        $      1.31           1.02            .89
          Diluted earnings per share                      $      1.18            .97            .87
</TABLE>

         Reclassifications
         -----------------
         Certain 2001 and 2002 amounts have been reclassified to conform with
         the 2003 presentation.

                                       26
<PAGE>

2)       Investment Securities, Available for Sale
         -----------------------------------------

         The amortized cost and fair value of investment securities available
         for sale are as follows:
<TABLE><CAPTION>
                                                         Gross       Gross
                                         Amortized    Unrealized   Unrealized      Fair
                                            Cost         Gains       Losses        Value
                                         ----------   ----------   ----------    ---------
<S>                                      <C>          <C>          <C>           <C>
          December 31, 2003
          United States Government
             and agency obligations      $1,258,132        7,149         --      1,265,281
          Corporate debt securities         703,203          282          692      702,793
          Marketable equity securities      164,660       14,620         --        179,280
                                         ----------   ----------   ----------   ----------
                                         $2,125,995       22,051          692    2,147,354
                                         ==========   ==========   ==========   ==========

          December 31, 2002
          United States Government
             and agency obligations      $4,370,580       82,094         --      4,452,674
          Municipal securities               99,714        7,543         --        107,257
          Corporate debt securities       1,016,228       12,574         --      1,028,802
          Marketable equity securities      158,463       16,925         --        175,388
                                         ----------   ----------   ----------   ----------
                                         $5,644,985      119,136         --      5,764,121
                                         ==========   ==========   ==========   ==========


         The contractual maturity of the above investments is summarized as
         follows:

                                                     December 31, 2003         December 31, 2002
                                                  -----------------------   -----------------------
                                                   Amortized      Fair       Amortized      Fair
         Term to Maturity                            Cost         Value        Cost         Value
         ----------------                         ----------   ----------   ----------   ----------
         Due in one year or less                  $  703,203      702,793    2,502,216    2,533,512
         Due after one year through five years     1,258,132    1,265,281    2,884,592    2,947,964
         Due after five years through ten years         --           --         99,714      107,257
         Marketable equity securities                164,660      179,280      158,463      175,388
                                                  ----------   ----------   ----------   ----------

                                                  $2,125,995    2,147,354    5,644,985    5,764,121
                                                  ==========   ==========   ==========   ==========
</TABLE>

         Proceeds from sales of investment securities, available for sale during
         the year ended December 31, 2003 were $1,198,074 with gross gains of
         $29,697 and gross losses of $760 realized on those sales. There were no
         sales of investment securities, available for sale during the year
         ended December 31, 2002. Proceeds from sales of investment securities
         available for sale during the year ended December 31, 2001 were
         $519,933 with gross gains of $17,781 realized on those sales. The
         change in net unrealized gains and losses during the current year of
         $97,777, net of the tax effect of $39,111, resulted in a $58,666 charge
         to stockholders' equity.

                                       27
<PAGE>

3)       Trading Securities
         ------------------

         Trading securities are accounted for at their current fair values.
         Trading securities at December 31, 2003 consists of equity securities
         (common stock with a carrying value of $498,428). The common stock
         investment at December 31, 2003 is pledged as collateral for a
         revolving line of credit as discussed in Note 11. Trading securities at
         December 31, 2002 also consists of equity securities (common stock with
         a carrying value of $475,928) and debt securities with a carrying value
         of $90,000. The adjustment of these securities to their current fair
         values has resulted in a net unrealized gain of $130,209, $36,120 and
         $99,611 for the years ended December 31, 2003, 2002 and 2001. Proceeds
         from sales of trading securities during the years ended December 31,
         2003, 2002 and 2001 were $119,957, $75,000 and $519,537 with gross
         gains of $21,082, $21,563 and $67,013 realized on those sales.

4)       Mortgage-Backed Securities, Available for Sale
         ----------------------------------------------

         The amortized cost and fair value of mortgage-backed securities
         available for sale are as follows:
<TABLE><CAPTION>

                                                                      Gross       Gross
                                                       Amortized   Unrealized   Unrealized      Fair
                                                         Cost         Gains       Losses        Value
                                                      ----------   ----------   ----------   ----------
<S>                                                   <C>          <C>          <C>          <C>
         December 31, 2003
           Participation Certificates:
             FHLMC      -  Fixed rate                 $1,469,346       41,636        9,585    1,501,397
             FNMA       -  Adjustable rate                24,562          --            65       24,497
             FNMA       -  Fixed rate                  1,189,846       20,165          --     1,210,011
             GNMA       -  Fixed rate                    156,463       17,324          --       173,787
           Collateralized Mortgage Obligations:
             FNMA       -  Fixed rate                    246,484          --           722      245,762
                                                      ----------   ----------   ----------   ----------

                                                      $3,086,701       79,125       10,372    3,155,454
                                                      ==========   ==========   ==========   ==========


           Weighted average interest rate                  5.16%
                                                           ====


         December 31, 2002
           Participation Certificates:
             FHLMC      -  Fixed rate                 $1,564,037       90,901          606    1,654,332
             FNMA       -  Adjustable rate                30,185          --           537       29,648
             FNMA       -  Fixed rate                    504,397          --         2,109      502,288
             GNMA       -  Fixed rate                    414,497       42,454          --       456,951
                                                      ----------   ----------   ----------   ----------

                                                      $2,513,116      133,355        3,252    2,643,219
                                                      ==========   ==========   ==========   ==========


           Weighted average interest rate                  6.50%
                                                           ====
</TABLE>

         There were no sales of mortgage-backed securities available for sale
         during the years ended December 31, 2003, 2002 and 2001. The change in
         net unrealized gains and losses during the current year of $61,350, net
         of the tax effect of $24,540, resulted in a $36,810 charge to
         stockholders' equity.

                                       28
<PAGE>

5)       Loans Receivable
         ----------------
         Loans receivable are summarized as follows:
                                                          December 31,
                                                  ----------------------------
                                                      2003            2002
                                                  ------------    ------------
         Mortgage loans:
            One-to-four family                    $ 78,947,907      81,827,647
            Multi-family                            11,128,195       4,195,972
            Nonresidential                          14,711,202      11,001,703
            Construction                             2,053,068       2,770,809
            Land                                     4,544,116       5,014,703
                                                  ------------    ------------

          Total mortgage loans                     111,384,488     104,810,834
                                                  ------------    ------------
         Other loans:
            Loans on deposit accounts                  179,818         182,700
            Equity lines of credit                   5,004,050       4,498,608
            Other consumer                           1,797,190       1,469,470
                                                  ------------    ------------

          Total other loans                          6,981,058       6,150,778
                                                  ------------    ------------

         Commercial business loans                   4,157,373       6,545,928
                                                  ------------    ------------

          Total loans receivable                   122,522,919     117,507,540
                                                  ------------    ------------
         Less:
            Loans in process                         1,359,292       2,504,772
            Net deferred yield adjustments             (78,425)       (153,422)
            Allowance for loan losses                1,033,226         837,859
                                                  ------------    ------------

         Loans receivable, net                    $120,208,826     114,318,331
                                                  ============    ============

         Weighted average interest rate                  6.26%           6.90%
                                                         ====            ====

         Activity in the allowance for loan losses is summarized as follows:

                                               Years Ended December 31,
                                        ------------------------------------
                                           2003         2002         2001
                                        ----------   ----------   ----------
         Balance, beginning of year     $  837,859      766,465      701,173
         Provision for loan losses         213,604      392,027      152,303
         Charge-offs                       (22,976)    (404,363)     (94,851)
         Recoveries                          4,739       83,730        7,840
                                        ----------   ----------   ----------

         Balance, end of year           $1,033,226      837,859      766,465
                                        ==========   ==========   ==========

         Delinquent loans (loans having monthly payments past due ninety days or
         more and non-accruing) at December 31, 2003 and 2002 amounted to
         approximately $1,581,000 and $1,071,000, respectively. As of December
         31, 2003 and 2002, the total investment in impaired loans was $609,000
         and $475,000, respectively. The impaired loans at these dates were
         subject to an allowance for credit losses of $433,000 and $219,000,
         respectively, which is included in the above loan loss allowance.

         For the years ended December 31, 2003 and 2002, gross interest income
         which would have been recorded had the non-accruing loans been current
         in accordance with their original terms amounted to approximately
         $68,000 and $61,000, respectively.

         Loans to directors and executive officers aggregated approximately
         $727,000 and $408,000 at December 31, 2003 and 2002, respectively. Such
         loans are made on substantially the same terms as those for other loan
         customers.

                                       29
<PAGE>

6)       Investment in Limited Partnership
         ---------------------------------

         The investment in limited partnership of $951,998 and $1,042,600 at
         December 31, 2003 and 2002 represents a 39.60% equity in Pedcor
         Investments 1997 - XXXI ("Pedcor"), a limited partnership organized to
         build, own and operate a 56 unit apartment complex. The Bank has
         recorded its equity in the losses of Pedcor in the amount of $90,062,
         $87,683 and $103,489 for the years ended December 31, 2003, 2002 and
         2001. Condensed financial statements for Pedcor are as follows:

                   Condensed Statements of Financial Condition
                   -------------------------------------------

                                                            December 31,
                                                      -----------------------
                                                         2003         2002
                                                      ----------   ----------
         Assets
         ------

         Cash                                         $    5,749        9,164
         Property and equipment                        3,632,988    3,732,241
         Land                                            112,000      112,000
         Other                                            70,263       50,648
                                                      ----------   ----------

           Total assets                                3,821,000    3,904,053
                                                      ==========   ==========

         Liabilities
         -----------

         Notes payable - Bank                            633,749      733,885
         Notes payable - Other                         2,397,779    2,535,233
         Other liabilities                               254,373      198,778
                                                      ----------   ----------
           Total liabilities                           3,285,901    3,467,896
                                                      ----------   ----------

         Partners' capital                               535,099      436,157
                                                      ----------   ----------

           Total liabilities and partners' capital    $3,821,000    3,904,053
                                                      ==========   ==========


                                                  Years Ended December 31,
                                             ---------------------------------
                                                2003        2002        2001
                                             ---------   ---------   ---------
         Condensed statement of operations

         Total revenues                      $ 254,475     245,735     267,731
         Total expenses                        479,677     467,157     526,279
                                             ---------   ---------   ---------

             Net loss                        $(225,202)   (221,422)   (258,548)
                                             =========   =========   =========

                                       30
<PAGE>

7)       Accrued Interest Receivable
         ---------------------------

         Accrued interest receivable is summarized as follows:

                                                           December 31,
                                                     ------------------------
                                                        2003          2002
                                                     ----------    ----------

         Investment securities                       $   41,288        70,172
         Mortgage-backed securities                      13,266        13,677
         Loans receivable                               703,838       733,821
         Allowance for uncollected interest            (137,325)     (113,743)
                                                     ----------    ----------
                                                     $  621,067       703,927
                                                     ==========    ==========

8)       Office Properties and Equipment
         -------------------------------

         Office properties and equipment are
          summarized as follows:

                                                           December 31,
                                                     ------------------------
                                                        2003          2002
                                                     ----------    ----------
         Cost:
             Land -        Munster                   $   40,669        40,669
                           Hammond                       33,300        33,300
                           Dyer                         300,000       300,000
             Building -    Munster                      452,935       424,704
                           Hammond                      308,049       285,521
                           Dyer                       1,762,802     1,748,900
             Furniture and equipment                  1,834,082     1,586,324
                                                     ----------    ----------
                                                      4,731,837     4,419,418

         Less accumulated depreciation:
             Building -    Munster                      419,943       415,293
                           Hammond                      259,131       250,585
                           Dyer                         228,725       172,942
             Furniture and equipment                  1,270,154     1,155,073
                                                     ----------    ----------
                                                      2,177,953     1,993,893

         Net book value                              $2,553,884     2,425,525
                                                     ==========    ==========


         Depreciation of office properties and equipment for the years ended
         December 31, 2003, 2002 and 2001 amounted to $184,060, $183,855 and
         $198,641, respectively.

         The Bank owns a three story office building in Dyer, Indiana, which is
         one-third utilized by the Bank as its branch office location. An
         additional one-third of the building is leased to a third party at a
         current annual lease rent of $69,201. This lease commenced on June 1,
         2002 and terminates May 31, 2007 subject to two five-year lease renewal
         options. The remainder of the building is being leased to a third-
         party at a current annual lease rent of $31,800. This lease commenced
         on October 1, 2003 and terminates September 30, 2009 subject to two
         six-year lease renewal options.

                                       31
<PAGE>

9)       Prepaid Expenses and Other Assets
         ---------------------------------

         Prepaid expenses and other assets consist of the following:
<TABLE><CAPTION>
                                                                         December 31,
                                                                   -----------------------
                                                                      2003         2002
                                                                   ----------   ----------
<S>                                                                <C>              <C>
         Prepaid insurance premiums                                $   72,059       62,754
         Prepaid pension cost                                         254,851      234,496
         Prepaid statutory trust preferred fees                       180,040      186,445
         Other prepaid expenses                                       122,364       90,912
         Deferred federal and state income tax asset - net (a)        495,312      481,761
         Purchased accounts receivable (b)                          2,317,434    1,874,440
         Purchased accounts receivable, serviced by others             40,080    1,998,202
         Miscellaneous                                                109,510       35,054
                                                                   ----------   ----------
                                                                   $3,591,650    4,964,064
                                                                   ==========   ==========


         (a) Significant components of the deferred tax assets and liabilities
             are as follows:

                                                                         December 31,
                                                                   -----------------------
                                                                      2003         2002
                                                                   ----------   ----------
         Deferred tax assets:
           Loan fees deferred for financial reporting purposes     $   10,058        3,403
           Accelerated book depreciation                                  --        21,879
           Deferred compensation                                      318,728      285,917
           Nondeductible incentive plan expense                         6,957        6,957
           Book allowance for loan losses                             413,290      335,144
           Allowance for uncollected interest                          16,068       45,497
           Other                                                          --         1,139
                                                                   ----------   ----------

               Total deferred tax assets                              765,101      699,936
                                                                   ----------   ----------


         Deferred tax liabilities:
           Tax allowance for loan losses                                  --        19,082
           Accelerated tax depreciation                                31,198          --
           Federal Home Loan Bank stock dividend                       33,600          --
           Pension expense                                            101,940       93,798
           Unrealized gain on securities, available for sale           36,045       99,696
           Unrealized gain on trading account securities               57,682        5,599
           Other                                                        9,324          --
                                                                   ----------   ----------

               Total deferred tax liabilities                         269,789      218,175
                                                                   ----------   ----------

               Net deferred tax benefit                            $  495,312      481,761
                                                                   ==========   ==========
</TABLE>


         (b)  The Bank has entered into a program to purchase and manage the
              accounts receivable of credit- worthy merchants with required
              repurchase of delinquent accounts and with the merchant's
              repurchase obligation supported by a cash collateral reserve
              account. For each merchant, the Bank establishes a maximum amount
              of purchased receivables allowed to be outstanding at any one
              time. At December 31, 2003 and 2002, this amount was $1,869,000
              and $2,725,000, respectively.

                                       32
<PAGE>

10)      Deposits
         --------

         Deposit accounts are summarized as follows:

                                                             December 31,
                                                     ---------------------------
                                                         2003           2002
                                                     ------------   ------------

         Passbook accounts                           $ 19,849,910     17,623,790
         Demand deposits and NOW accounts              10,434,381      9,439,848
         Money market accounts                         14,107,218     10,033,382
                                                     ------------   ------------

                                                       44,391,509     37,097,020

      Certificates of deposit by interest rate:
           0.76 - 1.00%                                   228,148            --
           1.01 - 2.00                                 21,050,417      2,615,470
           2.01 - 3.00                                 23,108,473     27,352,476
           3.01 - 4.00                                 11,830,735     30,641,531
           4.01 - 5.00                                  6,842,225      9,260,871
           5.01 - 6.00                                    497,752      1,333,169
           6.01 - 7.00                                    385,065        997,521
           7.01 - 8.00                                        --          25,000
           8.01 - 9.00                                        --           7,923
                                                     ------------   ------------

                                                       63,942,815     72,233,961
                                                     ------------   ------------
                                                     $108,334,324    109,330,981
                                                     ============   ============

         The weighted average rate on deposit accounts at December 31, 2003 and
         2002 was 2.11% and 2.78%, respectively.

         The aggregate amount of certificates of deposit with a minimum
         denomination of $100,000 was $13,380,000 and $15,085,000 at December
         31, 2003 and 2002, respectively.

         A summary of certificates of deposit by maturity is as follows:

                                                            December 31,
                                                     -------------------------
                                                         2003          2002
                                                     -----------   -----------

         Within 12 months                            $50,119,257    46,337,611
         12 months to 24 months                       11,426,769    17,976,651
         24 months to 36 months                        1,675,792     6,655,579
         36 months to 48 months                          580,536     1,123,563
         Over 48 months                                  140,461       140,557
                                                     -----------   -----------

             Total                                   $63,942,815    72,233,961
                                                     ===========   ===========

         Interest expense on deposits consists of the following:

                                             Years Ended December 31,
                                      --------------------------------------
                                         2003          2002          2001
                                      ----------    ----------    ----------
         Passbook accounts            $   79,357       334,092       392,522
         NOW accounts                     67,798        79,088       118,204
         Money market accounts           301,881       224,042        99,705
         Certificates of deposit       2,015,311     2,656,223     4,141,088
                                      ----------    ----------    ----------

             Total                    $2,664,347     3,293,445     4,751,519
                                      ==========    ==========    ==========

                                       33
<PAGE>

11)      Borrowed Money
         --------------

         Borrowed money consists of advances from the Federal Home Loan Bank of
         Indianapolis and is summarized as follows:

                                                      December 31,
                                   Interest      --------------------------
         Maturity Date               Rate           2003           2002
         --------------            --------      -----------    -----------

         January 21, 2003           5.68%        $     --        1,000,000
         September 15, 2003         5.26               --        4,000,000
         August 24, 2004            4.80          2,000,000      2,000,000
         August 24, 2005            5.11          2,000,000      2,000,000
         January 23, 2006           4.73          2,000,000      2,000,000
         August 23, 2006            5.32          1,000,000      1,000,000
         December 18, 2006          2.93          1,000,000           --
         May 15, 2009               5.93            633,749        733,885
         August 16, 2010            5.99          1,500,000      1,500,000
         September 20, 2010         5.95          1,000,000      1,000,000
         December 20, 2010          4.98          2,000,000      2,000,000
         March 22, 2011             4.09            500,000        500,000
         July 15, 2015              5.91            657,384        667,097
         November 16, 2020          6.71          1,838,581      1,895,917
                                                -----------    -----------
                                                $16,129,714     20,296,899
                                                ===========    ===========

         Weighted average interest rate                5.24%         5.38%
                                                       ====          ====

         The Bank is required to maintain qualifying collateral for the Federal
         Home Loan Bank of Indianapolis representing approximately 145 percent
         of current Bank credit. At December 31, 2003, the Bank met this
         requirement. Assets which are eligible collateral for meeting the 145%
         coverage requirement include one-to-four family whole mortgage loans,
         government and agency securities including mortgage- backed securities
         insured or guaranteed by FHLMC, FNMA and GNMA, and high rated private
         mortgage-backed securities. The mortgage loans must not include
         participations, construction loans, loans which are not in the clear
         title of the institution, conventional mortgages with more than 30
         years remaining to maturity, loans for more than 90% of the appraised
         value unless there is private or federal insurance, mortgages which are
         more than 60 days delinquent, or loans upon which any employee of the
         institution or the FHLB is personally liable.

         The Company has entered into a revolving line of credit in the maximum
         amount of $475,000. The loan will bear interest at one half percent
         under the Wall Street Journal prime rate. The Company may borrow up to
         75% of the market value of the collateral security. At December 31,
         2003, the Company pledged common stock with a market value of
         approximately $496,000 as collateral securing this line of credit. The
         Company did not borrow against this line of credit during the current
         year.

         In connection with the Company's initial public offering, the Bank
         established an Employee Stock Ownership Plan (ESOP). The ESOP was
         funded by the proceeds from a loan from the Company. The loan carries
         an interest rate of 6.07% and matures in the year 2006. The loan is
         secured by the shares

                                       34
<PAGE>

         of the Company purchased with the loan proceeds. The Bank has committed
         to make contributions to the ESOP sufficient to allow the ESOP to fund
         the debt service requirements of the loan. At December 31, 2003, the
         balance of this loan amounted to $179,860.







































                                       35
<PAGE>

12)      Guaranteed Preferred Beneficial Interest in Junior Subordinated
         ---------------------------------------------------------------
         Debentures
         ----------

         In March of 2002, the Company formed AMB Financial Statutory Trust I
         ("Trust"). The Trust is a statutory business trust and is wholly owned
         by the Company. The Trust issued $5.0 million of Trust Preferred
         Capital Securities (the "Capital Securities") as a participant in a
         pooled trust preferred securities offering concurrent with the issuance
         of the Capital Securities, the Trust issued trust common securities to
         the Company in the aggregate liquidation value of $155,000. The
         proceeds of the issuance of the Capital Securities and trust common
         securities were invested in the Company's junior subordinated
         debentures. The junior subordinated debentures are the sole assets of
         the Trust. The junior subordinated debentures and the trust preferred
         securities pay interest on a quarterly basis. The junior subordinated
         debentures and the securities bear interest at a rate of 3-month LIBOR
         plus 3.60%, mature on March 27, 2032 and are non-callable for five
         years and, after that period, the securities may be called at any
         quarterly interest payment date at par. Distributions on the Capital
         Securities are payable quarterly. The costs associated with the Capital
         Securities issuance have been capitalized and are being amortized over
         the estimated life of the securities.

13)      Other Liabilities
         -----------------

         Other liabilities include the following:

                                                           December 31,
                                                     ------------------------
                                                        2003          2002
                                                     ----------    ----------

         Accrued interest on deposits                $    6,682        14,594
         Accrued interest on borrowings                  37,355        48,567
         Accrued bonus                                  128,483        84,500
         Accrued audit and accounting fees               32,348        32,123
         Accrued real estate and personal
          property taxes                                144,995        88,900
         Accrued income taxes                           242,147        80,412
         Deferred compensation (see note 14)            796,821       714,792
         Outstanding bank drafts                        810,908       547,819
         Miscellaneous accounts payable                 302,303       252,713
                                                     ----------    ----------
                                                     $2,502,042     1,864,420
                                                     ==========    ==========

                                       36
<PAGE>

14)      Benefit Plans
         -------------

         Beginning in 2002, the Bank participates in an industry-wide,
         multi-employer, defined-benefit pension plan, which covers all
         full-time employees who have attained at least 21 years of age and
         completed one year of service. Calculations to determine full-funding
         status are made annually as of June 30. Pension expense for the years
         ended December 31, 2003 and 2002 amounted to $171,324 and $251,407,
         respectively. Information regarding the Bank's share of assets and
         liabilities and plan benefit information of this plan is not available
         on an individual basis. Under the prior plan, pension expense for the
         year ended December 31, 2001 amounted to $77,802.

         Effective March 2002, the Bank commenced participation in the Financial
         Institutions Thrift Plan, which qualifies under Section 401(k) of the
         Internal Revenue Code and which covers substantially all employees.
         This plan calls for a discretionary contribution within specified
         limits and a matching Bank contribution equal to 50% of the first 6% of
         the employee contributions. Plan expense for the years ended December
         31, 2003 and 2002 amounted to $13,632 and $11,223, respectively.

         The Bank also has established two non-qualified 401(k) Plan for
         officers of the Bank. Both Plans provide participating officers the
         opportunity to defer up to 6% of their salary into a tax deferred
         accumulation for future retirement. In addition, the Bank has also
         established a Director Deferral Plan which provides participating
         directors with the opportunity to defer all or a portion of their fees
         over a predetermined period. All deferred non-qualified 401(k) Plan
         contributions and deferred director fees are credited with interest
         from the Bank at the rate of 10% per year. Interest credited by the
         Bank to the non-qualified plans and deferred director fees on
         accumulated funds was $75,499, $66,768 and $58,399 for the years ended
         December 31, 2003, 2002 and 2001, respectively.











                                       37
<PAGE>

15)      Director, Officer and Employee Plans
         ------------------------------------
         Stock Option Plan. In conjunction with the Conversion, the stockholders
         of the Company approved the AMB Financial Corp. 1996 Stock Option and
         Incentive Plan. This is an incentive stock option plan for the benefit
         of the directors, officers and employees of the Company and its
         affiliates. The number of options on shares of common stock authorized
         under the Plan is 210,772, equal to 10.0% of the total number of shares
         issued in the Conversion. As of October 23, 1996, 187,578 options were
         granted at $6.80 per share, exercisable at a rate of 20% per year
         commencing October 23, 1997, and expiring ten years from the date of
         grant. The following is an analysis of the stock option activity for
         each of the years in the three year period ended December 31, 2002 and
         the stock options outstanding at the end of the respective periods.

                                              Number of      Exercise Price
         Options                                Options   Per Share      Total
         -------                               --------   ---------   ----------
         Outstanding at December 31, 2000       187,578    $  6.80    $1,275,530
         Granted                                      0
         Exercised                                    0
         Forfeited                                    0
                                               --------    -------    ----------

         Outstanding at December 31, 2001       187,578       6.80     1,275,530
         Granted                                      0
         Exercised                                    0
         Forfeited                                    0
                                               --------    -------    ----------

         Outstanding at December 31, 2002       187,578       6.80     1,275,530
         Granted                                      0
         Exercised                                    0
         Forfeited                                    0
                                               --------    -------    ----------

         Outstanding at December 31, 2003       187,578    $  6.80    $1,275,530
                                               ========    =======    ==========

         Exercisable at December 31, 2003       187,578    $  6.80    $1,275,530
                                               ========    =======    ==========
         Options available for future
             grants at December 31, 2003         23,194
                                               ========

         The Company accounts for its stock options in accordance with
         Accounting Principles Board (APB) Opinion No. 25 "Accounting for Stock
         Issued to Employees". Under APB 25, as the exercise price of the
         Company's employees' stock options equals the market price of the
         underlying stock on the date of grant, no compensation expense is
         recognized.

         The Company has implemented SFAS No. 123 "Accounting for Stock-Based
         Compensation". The Company has retained its accounting method for its
         stock-based compensation plans. This statement has only resulted in
         additional disclosures for the Company, and as such, its adoption did
         not, nor is it expected to have, a material impact on the Company's
         financial condition or its results of operations.

         The following summarizes the pro forma net income as if the fair value
         method of accounting for stock- based compensation plans had been
         utilized:
<TABLE><CAPTION>
                                                            Years Ended December 31,
                                                     --------------------------------------
                                                        2003          2002          2001
                                                     ----------    ----------    ----------
<S>                                                  <C>            <C>             <C>
         Net income (as reported)                    $1,182,255     1,001,331       900,891
         Pro forma net income                         1,182,255     1,001,331       845,713
         Diluted earnings per share (as reported)          1.18           .97           .87
         Pro forma diluted earnings per share              1.18           .97           .82
</TABLE>
         The pro forma results presented above may not be representative of the
         effects reported in pro forma net income for future years.

                                       38
<PAGE>

15)      Director, Officer and Employee Plans (continued)
         ------------------------------------------------

         Employee Stock Ownership Plan. In conjunction with the Conversion, the
         Bank formed an Employee Stock Ownership Plan ("ESOP"). The ESOP covers
         substantially all employees with more than one year of employment and
         who have attained the age of 18. The ESOP borrowed $899,300 from the
         Company and purchased 168,618 (split adjusted) common shares issued in
         the Conversion. The Bank will make scheduled discretionary cash
         contributions to the ESOP sufficient to service the amount borrowed. In
         accordance with generally accepted accounting principles, the unpaid
         balance of the ESOP loan, which is comparable to unearned compensation,
         is reported as a reduction of stockholders' equity. Total contributions
         by the Bank to the ESOP which were used to fund principal and interest
         payments on the ESOP debt totaled $96,694, $99,216 and $101,538 for the
         years ended December 31, 2003, 2002 and 2001, respectively.

         Statement of Position No. 93-6, "Employers' Accounting for Employee
         Stock Ownership Plans" ("SOP 93-6") provides guidance for accounting
         for all ESOPs. SOP 93-6 requires that the issuance or sale of treasury
         shares to the ESOP be reported when the issuance or sale occurs and
         that compensation expense be recognized for shares committed to be
         released to directly compensate employees equal to the fair value of
         the shares committed. In addition, SOP 93-6 requires that leveraged
         ESOP debt and related interest expense be reflected in the employer's
         financial statements. Prior practice was to recognize compensation
         expense based on the amount of the employer's contributions to the
         ESOP. The application of SOP 93-6 results in fluctuations in
         compensation expense as a result of changes in the fair value of the
         Company's common stock; however, any such compensation expense
         fluctuations will result in an offsetting adjustment to additional
         paid-in capital. For the years ended December 31, 2003, 2002 and 2001,
         additional compensation expense of $132,525, $68,087 and $39,682 was
         recognized as a result of implementation of this accounting principle.








                                       39
<PAGE>

16)      Income Taxes
         ------------

         As a result of legislation that changed the method used by many thrifts
         to calculate their bad debt reserve for federal income tax purposes,
         the Bank must recapture that portion of the reserve that exceeds the
         amount that could have been taken under the experience method for tax
         years beginning after December 31, 1987. The legislation also requires
         thrifts to account for bad debts for federal income tax purposes on the
         same basis as commercial banks for tax years beginning after December
         31, 1995. The recapture is occurring over a six year period. The
         commencement of the recapture by the Bank was delayed two years as the
         Bank met certain residential lending requirements. For the three years
         ended December 31, 2002, the Bank recaptured approximately $143,000 in
         excess bad debt reserves resulting in tax payments of approximately
         $57,000 which were previously accrued. The pre-1988 reserve provisions
         are subject only to recapture requirements if the Bank no longer
         qualifies as a thrift. Tax bad debt deductions accumulated prior to
         1988 by the Bank and included in retained earnings total approximately
         $1,950,000. No deferred income taxes have been provided for these bad
         debt deductions and no recapture of these amounts is anticipated.

         The provision for income taxes consists of the following:

                                           Years Ended December 31,
                                       --------------------------------
                                         2003        2002        2001
                                       --------    --------    --------
         Current                       $520,942     336,456     229,112
         Deferred                        50,100      39,571      (5,521)
                                       --------    --------    --------

                                       $571,042     376,027     223,591
                                       ========    ========    ========

         A reconciliation of the statutory federal income tax rate to effective
         income tax rate is as follows:

                                                      Years Ended December 31,
                                                    ---------------------------
                                                     2003       2002       2001
                                                    -----      -----      -----
         Statutory federal income tax rate           34.0%      34.0%      34.0%
         State income taxes                           5.3        5.4        3.8
         Low income housing credit                   (7.9)     (10.1)     (12.4)
         Cash surrender value of life insurance      (3.4)      (4.6)      (5.5)
         ESOP expense                                 3.0        2.0        1.4
         Other                                        1.6         .6       (1.4)
                                                    -----      -----      -----
         Effective income tax rate                   32.6%      27.3%      19.9%
                                                    =====      =====      =====

         Deferred income tax expense consists of the following tax effects of
         timing differences:
<TABLE><CAPTION>
                                                                       Years Ended December 31,
                                                                 ----------------------------------
                                                                   2003         2002         2001
                                                                 --------     --------     --------
<S>                                                              <C>             <C>          <C>
         Loan fees                                               $ (6,655)       7,772        2,420
         Federal Home Loan Bank stock dividend                     33,600          --           --
         Depreciation                                              53,077       27,201        1,944
         Deferred compensation                                    (32,811)     (35,566)     (33,344)
         Pension                                                    8,142       93,798          --
         Book loan loss provision in excess of tax deduction      (78,146)     (28,558)     (26,117)
         Recapture of bad debt reserve                            (19,082)     (19,081)     (19,081)
         Unrealized gain on trading account securities             52,083       14,448       39,845
         Other, net                                                39,892      (20,443)      28,812
                                                                 --------     --------     --------
                                                                 $ 50,100       39,571       (5,521)
                                                                 ========     ========     ========
</TABLE>
                                       40
<PAGE>

17)      Regulatory Capital Requirements
         -------------------------------

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

         Quantitative measures established by regulation to ensure capital
         adequacy require the Bank to maintain minimum amounts and ratios, set
         forth in the table below of the total risk-based, tangible and core
         capital, as defined in the regulations. Management believes, as of
         December 31, 2003, that the Bank meets all capital adequacy
         requirements to which it is subject.

         The Bank, according to federal regulatory standards, is
         well-capitalized under the regulatory framework for prompt corrective
         action. To be categorized as adequately capitalized, the Bank must
         maintain minimum total risk-based, tangible, and core ratios as set
         forth in the table. There are no conditions or events since that
         notification that management believes have changed the institution's
         category.

         At December 31, 2003 and 2002, the Bank's actual capital amounts and
         ratios, minimum amounts and ratios required for capital adequacy
         purposes and minimum amounts and ratios to meet the well- capitalized
         criteria under prompt corrective action provision, are as follows:
<TABLE><CAPTION>
                                                                                              To Be Well-
                                                                                          Capitalized Under
                                                                   For Capital            Prompt Corrective
                                            Actual              Adequacy Purposes         Action Provisions
                                    ---------------------      -------------------       -------------------
                                       Amount       Ratio        Amount      Ratio         Amount      Ratio
                                    ---------------------      -------------------       -------------------
<S>                                <C>              <C>       <C>            <C>        <C>             <C>
         December 31, 2003

         Tangible                   $12,657,723      8.78%     $2,163,000     1.50%      $      N/A      N/A%
         Core                        12,657,723      8.78       4,326,000     3.00        7,211,000     5.00
         Risk-based                  13,242,949     15.23       6,956,000     8.00        8,695,000    10.00

         December 31, 2002

         Tangible                   $11,109,186      7.58%     $2,199,000     1.50%      $      N/A      N/A%
         Core                        11,109,186      7.58       4,398,000     3.00        7,331,000     5.00
         Risk-based                  11,713,045     13.54       6,921,000     8.00        8,652,000    10.00
</TABLE>
                                       41
<PAGE>

17)      Regulatory Capital Requirements (continued)
         -------------------------------------------

                                            Tangible      Core      Risk-based
                                            Capital      Capital      Capital
                                          -----------  -----------  -----------
         December 31, 2003

         Stockholders' equity             $12,711,621   12,711,621   12,711,621
         Unrealized gain on securities
          available for sale, net of
          taxes                               (53,898)     (53,898)     (53,898)
         General loss allowances                  --           --       600,226
         Direct equity investments                --           --       (15,000)
                                          -----------  -----------  -----------

         Regulatory capital computed      $12,657,723   12,657,723   13,242,949
                                          ===========  ===========  ===========


         December 31, 2002

         Stockholders' equity             $11,248,333   11,248,333   11,248,333
         Unrealized gain on securities
          available for sale, net of
          taxes                              (139,147)    (139,147)    (139,147)
         General loss allowances                  --           --       618,859
         Direct equity investments                --           -        (15,000)
                                          -----------  -----------  -----------

         Regulatory capital computed      $11,109,186   11,109,186   11,713,045
                                          ===========  ===========  ===========



18)      Stockholders' Equity
         --------------------

         As part of the Conversion, the Bank established a liquidation account
         for the benefit of all eligible depositors who continue to maintain
         their deposit accounts in the Bank after conversion. In the unlikely
         event of a complete liquidation of the Bank, each eligible depositor
         will be entitled to receive a liquidation distribution from the
         liquidation account, in the proportionate amount of the then current
         adjusted balance for deposit accounts held, before distribution may be
         made with respect to the Bank's capital stock. The Bank may not declare
         or pay a cash dividend to the Company on, or repurchase any of, its
         capital stock if the effect thereof would cause the retained earnings
         of the Bank to be reduced below the amount required for the liquidation
         account. Except for such restrictions, the existence of the liquidation
         account does not restrict the use or application of retained earnings.

         In addition, the Bank may not declare or pay cash dividends on or
         repurchase any of its shares of common stock if the effect thereof
         would cause stockholders' equity to be reduced below applicable
         regulatory capital maintenance requirements or if such declaration and
         payment would otherwise violate regulatory requirements.

         Unlike the Bank, the Company is not subject to these regulatory
         restrictions on the payment of dividends to its stockholders. However,
         the Company's source of funds for future dividends may depend upon
         dividends received by the Company from the Bank.

                                       42
<PAGE>

19)      Financial Instruments with Off-Balance Sheet Risk
         -------------------------------------------------

         The Bank is a party to various transactions with off-balance sheet risk
         in the normal course of business. These transactions are primarily
         commitments to originate loans and to extend credit on previously
         approved unused lines of credit. These financial instruments carry
         varying degrees of credit and interest- rate risk in excess of amounts
         recorded in the consolidated financial statements.

         Commitments to originate mortgage loans of $3,840,500 at December 31,
         2003 represent amounts which the Bank plans to fund within the normal
         commitment period of 60 to 90 days. Of this amount, $2,790,500 are
         fixed rate commitments with rates ranging from 5.25% to 6.80% and
         $1,050,000 are in adjustable rate commitments. Because the credit
         worthiness of each customer is reviewed prior to extension of the
         commitment, the Bank adequately controls its credit risk on these
         commitments, as it does for loans recorded on the balance sheet. The
         Bank conducts all of its lending activities in the Northwest Indiana
         area. Management believes the Bank has a diversified loan portfolio and
         the concentration of lending activities in these local communities does
         not result in an acute dependency upon economic conditions of the
         lending region.

         The Bank has approved, but unused, home equity lines of credit of
         approximately $4,545,000 at December 31, 2003. Approval of lines of
         credit is based upon underwriting standards that generally do not allow
         total borrowings, including the line of credit, to exceed 75% of the
         estimated fair value of the customer's home. In addition, the Bank has
         approved but unused equity lines of credit on various construction and
         commercial projects of approximately $593,000 at December 31, 2003. The
         Bank also has approved but unused credit card lines of credit of
         approximately $638,000.

         The Bank is currently participating with several local financial
         institutions in credit enhancement agreements with in-state
         municipalities to guarantee the repayment on municipal revenue bonds.
         The Bank has accepted credit risk on these various municipal projects
         in the amount of approximately $1,420,000. These credit enhancements
         are in cooperation with the Federal Home Loan Bank of Indianapolis
         ("FHLB") and have pledging requirements as part of the qualifying
         collateral agreement with FHLB. Additionally, at December 31, 2003, the
         Bank had issued standby letters of credit totaling approximately
         $186,000 to guarantee the performance of a customer to a third party.

20)      Contingencies
         -------------

         The Bank is, from time to time, a party to certain lawsuits in the
         ordinary course of its business, wherein it enforces its security
         interest. Management, based upon discussions with legal counsel,
         believes that the Company and the Bank are not engaged in any legal
         proceedings of a material nature at the present time.

21)      Subsequent Event
         ----------------

         On January 21, 2004, the Company declared a quarterly cash dividend of
         $.06 per share, totaling $58,269, payable February 20, 2004 to
         shareholders of record as of February 6, 2004.

                                       43
<PAGE>

22)      Disclosures About the Fair Value of Financial Instruments
         ---------------------------------------------------------

         The following methods and assumptions were used to estimate the fair
         value of each class of financial instruments for which it is
         practicable to estimate that value:

         Cash and cash equivalents: For cash and interest-bearing deposits, the
         carrying amount is a reasonable estimate of fair value.

         Investment securities: Fair values for securities held to maturity,
         available for sale or held for trade are based on quoted market prices
         as published in financial publications or on quotes from third-party
         brokers.

         Mortgage-backed securities: Fair values for mortgage-backed securities
         are based on the lower of quotes received from various third-party
         brokers.

         Loans receivable: The fair values of fixed-rate one-to-four family
         residential mortgage loans are based on quoted market prices of similar
         loans sold in conjunction with securitization transactions. The fair
         values for other fixed and adjustable rate mortgage loans are estimated
         using discounted cash flow analyses, using interest rates currently
         being offered for loans with similar terms and collateral to borrowers
         of similar credit quality.

         Accrued interest receivable and payable: The carrying value of accrued
         interest receivable, net of the allowance for uncollected interest, and
         accrued interest payable approximates fair value due to the relatively
         short period of time between accrual and expected realization.

         Deposit liabilities: The fair value of demand deposits, savings
         accounts and money market deposits is the amount payable on demand at
         the reporting date. The fair value of fixed maturity certificates of
         deposit is estimated by discounting the future cash flows using the
         rates currently offered for deposits of similar original maturities.

         Borrowed money: Rates currently available to the Company for debt with
         similar terms and remaining maturities are used to estimate fair value
         of existing debt.

                                       44
<PAGE>

22)      Disclosures About the Fair Value of Financial Instruments (continued)
         ---------------------------------------------------------------------

         The estimated fair value of the Company's financial instruments as of
         December 31, 2003 and 2002 are as follows:
<TABLE><CAPTION>
                                                                        December 31, 2003
                                                                 ------------------------------
                                                                    Carrying          Fair
                                                                     Amount           Value
                                                                 ------------      ------------
<S>                                                             <C>               <C>
         Financial assets:
             Cash and cash equivalents                           $  7,234,789         7,234,789
             Investment securities, available for sale              2,147,354         2,147,354
             Trading securities                                       498,428           498,428
             Mortgage-backed securities, available for sale         3,155,454         3,155,454
             Loans receivable                                     120,208,826       123,330,000
             Accrued interest receivable                              621,067           621,067

         Financial liabilities:
             Deposits                                            $108,334,324       109,007,000
             Borrowed money                                        16,129,714        17,505,000
             Accrued interest payable                                  44,037            44,037



                                                                        December 31, 2003
                                                                 ------------------------------
                                                                    Carrying          Fair
                                                                     Amount           Value
                                                                 ------------      ------------
         Financial assets:
             Cash and cash equivalents                           $ 12,352,502        12,352,502
             Investment securities, available for sale              5,764,121         5,764,121
             Trading securities                                       565,929           565,929
             Mortgage-backed securities, available for sale         2,643,219         2,643,219
             Loans receivable                                     114,318,331       117,408,000
             Accrued interest receivable                              703,927           703,927

         Financial liabilities:
             Deposits                                            $109,330,981       110,623,000
             Borrowed money                                        20,296,899        22,127,000
             Accrued interest payable                                  63,161            63,161
</TABLE>
                                       45
<PAGE>

23)      Condensed Parent Company Only Financial Statements
         --------------------------------------------------
         The following condensed statement of financial condition, as of
         December 31, 2003 and 2002 and condensed statements of income and cash
         flows for the years ended December 31, 2003, 2002 and 2001 for AMB
         Financial Corp. should be read in conjunction with the consolidated
         financial statements and the notes thereto.

                   Condensed Statements of Financial Condition
                   -------------------------------------------
                                                             December 31,
                                                      -------------------------
                                                          2003          2002
                                                      -----------   -----------
         Assets
         Cash and cash equivalents                    $ 3,428,494     3,164,364
         Investment securities, available for sale        200,293     1,019,293
         Trading securities                               498,428       565,928
         Loans receivable                                 179,860       269,790
         Investment in American Savings, FSB           12,416,979    11,090,897
         Investment in AMB Financial Statutory
          Trust I                                         155,000       155,000
         Prepaid expenses and other assets                546,510       621,839
                                                      -----------   -----------

             Total assets                              17,425,564    16,887,111
                                                      ===========   ===========
         Liabilities and Stockholders' Equity

         Liabilities:
         Junior subordinated debentures                 5,155,000     5,155,000
         Accrued taxes and other liabilities               45,597        43,727
                                                      -----------   -----------

             Total liabilities                          5,200,597     5,198,727
                                                      -----------   -----------
         Stockholders' Equity:
         Common stock                                      16,862        16,862
         Additional paid-in capital                    10,646,278    10,644,379
         Retained earnings                              9,006,790     9,922,705
         Accumulated other comprehensive income               169        10,396
         Treasury stock                                (7,445,132)   (8,905,958)
                                                      -----------   -----------

             Total stockholders' equity                12,224,967    11,688,384
                                                      -----------   -----------

                                                      $17,425,564    16,887,111
                                                      ===========   ===========

                         Condensed Statements of Income
                         ------------------------------
<TABLE><CAPTION>
                                                                         Years Ended December 31,
                                                                  --------------------------------------
                                                                     2003          2002          2001
                                                                  ----------    ----------    ----------
<S>                                                              <C>           <C>           <C>
         Net interest income (expense)                            $  (96,122)      (35,832)       70,619
         Gain on sale of trading securities                           21,082        21,563        67,013
         Unrealized gain on trading securities                       130,209        36,120        99,611
         Other non-interest income                                    43,667        16,185        10,665
         Non-interest expense                                       (330,545)     (275,165)     (268,174)
                                                                  ----------    ----------    ----------
         Net loss before income taxes and
           equity in earnings of subsidiaries                       (231,709)     (237,129)      (20,266)
         Benefit from income taxes                                    87,882        88,797        12,428
                                                                  ----------    ----------    ----------

         Net loss before equity in earnings of subsidiaries         (143,827)     (148,332)       (7,838)
         Equity in earnings of subsidiaries                        1,326,082     1,149,663       908,729
                                                                  ----------    ----------    ----------
           Net income                                             $1,182,255     1,001,331       900,891
                                                                  ==========    ==========    ==========
</TABLE>
                                       46
<PAGE>

23)      Condensed Parent Company Only Financial Statements (continued)
         --------------------------------------------------------------

                       Condensed Statements of Cash Flows
                       ----------------------------------
<TABLE><CAPTION>

                                                                             Years Ended December 31,
                                                                    -----------------------------------------
                                                                        2003           2002           2001
                                                                    -----------    -----------    -----------
<S>                                                                <C>            <C>            <C>
         Operating activities:
            Net income                                              $ 1,182,255      1,001,331        900,891
            Equity in earnings of subsidiaries                       (1,326,082)    (1,149,663)      (908,729)
            Amortization of cost of stock benefit plan                     --             --           96,488
            Amortization of premiums and accretion of discounts           2,018          4,565           --
            Gain on sale of trading securities                          (21,082)       (21,563)       (67,013)
            Unrealized gain on trading securities held for trade       (130,209)       (36,120)       (99,611)
            Proceeds from sale of trading securities                    119,957         75,000        519,537
            Proceeds from redemption of trading securities              100,000           --             --
            Purchase of trading securities                               (1,166)          --             --
            Decrease (increase) in prepaid taxes and other assets        82,147       (309,167)        (2,903)
            Increase (decrease) in other liabilities                      1,870        (12,799)        14,592
                                                                    -----------    -----------    -----------

          Net cash provided by (for) operating activities                 9,708       (448,416)       453,252
                                                                    -----------    -----------    -----------

          Investing activities:
            Investment in AMB Financial Statutory Trust I                  --         (155,000)          --
            Proceeds from maturities of investment securities         1,500,000        500,000           --
            Purchase of investment securities                          (700,063)    (1,506,531)          --
            Loan repayments                                              89,930         89,930         89,930
                                                                    -----------    -----------    -----------

          Net cash provided by (for) investing activities               889,867     (1,071,601)        89,930
                                                                    -----------    -----------    -----------

          Financing activities:
            Proceeds from issuance of junior
              subordinated debentures                                      --        5,155,000           --
            Purchase of treasury stock                                 (457,240)      (862,460)      (777,286)
            Dividends received from Bank                                   --             --          100,000
            Dividends paid on common stock                             (178,205)      (189,612)      (194,038)
                                                                    -----------    -----------    -----------

          Net cash provided (for) by investing activities              (635,445)     4,102,928       (871,324)
                                                                    -----------    -----------    -----------

          Net increase (decrease) in cash and cash equivalents          264,130      2,582,911       (328,142)
          Cash and cash equivalents at beginning of year              3,164,364        581,453        909,595
                                                                    -----------    -----------    -----------

          Cash and cash equivalents at end of year                  $ 3,428,494      3,164,364        581,453
                                                                    ===========    ===========    ===========
</TABLE>

                                       47
<PAGE>
                               AMB Financial Corp.
                             Stockholder Information

ANNUAL MEETING

The annual meeting of stockholders will be held at 10:30 a.m., on April 28,
2004, at the Company's corporate office, located at 8230 Hohman Avenue, Munster,
Indiana.

STOCK LISTING

The Company's stock is traded over the counter, on the NASDAQ Small Cap Market
under the symbol "AMFC".

Price Range of Common Stock and Dividends

The table below shows the range of high and low sale prices and dividends paid
in fiscal 2003. All prior share-related information has been restated to reflect
the 5 for 4 stock split announced on April 23, 2003 distributed on May 29, 2003
to stockholders of record on May 14, 2003

                   Quarter Ended             High          Low        Dividends
                   -------------             ----          ---        ---------
                   March 31, 2003            12.540        10.540       $0.048
                   June 30, 2003             13.080         8.930       $0.048
                   September 30, 2003        15.910        14.200       $0.050
                   December 31, 2003         16.500        13.120       $0.050

The Board of Directors will consider the payment of future cash dividends based
on the results of operations and financial condition of the Company, tax
considerations, industry standards, economic conditions, regulatory
restrictions, general business practices and other factors. See Note 18 of the
Notes to the Consolidated Financial Statements for information regarding
limitations of the Bank's ability to pay dividends to the Company.

As of December 31, 2003, the Company had 330 stockholders of record and 949,379
outstanding shares of common stock.




SHAREHOLDER GENERAL INQUIRIES                    TRANSFER AGENT

Clement B. Knapp, Jr., President                 Registrar & Transfer Co.
AMB Financial Corp.                              10 Commerce Drive
8230 Hohman Ave.                                 Cranford, New Jersey 07016
Munster, Indiana  46321                          (800) 456-0596
(219) 836-5870











                                       48
<PAGE>


                               AMB FINANCIAL CORP.
                              CORPORATE INFORMATION



CORPORATE OFFICE

AMB Financial Corp.                      Telephone (219) 836-5870
8230 Hohman Avenue                       Fax       (219) 836-5883
Munster, IN  46321                       Web site   ambfinancial.com

DIRECTORS OF THE BOARD                   AMB FINANCIAL CORP.
                                         OFFICERS

Clement B. Knapp, Jr.                    Clement B. Knapp, Jr.
President since 1977.                    Chairman of the Board,
President                                and Chief Executive Officer

Ronald W. Borto                          Louis A. Green
Director since 1986.                     Senior Vice-President

Donald L. Harle                          Daniel T. Poludniak
Director since 1995.                     Vice-President, Treasurer
                                         and Chief Financial Officer
John C. McLaughlin
Director since 1979.                     Denise L. Knapp
                                         Corporate Secretary
John G. Pastrick
Director since 1979.                     Michael Mellon
                                         Executive Vice President
Robert E. Tolley
Director since 1987.                     Todd Williams
                                         Asst-Vice President

INDEPENDENT AUDITORS                     CORPORATE COUNSEL / LOCAL
Cobitz, VandenBerg & Fennessy            Abrahamson & Reed
9944 S. Roberts Road Suite 202           Attorneys at Law
Palos Hills, IL  60465                   200 Russell Street
                                         Hammond, IN 46320

                                         CORPORATE COUNSEL / WASHINGTON DC
                                         Luse, Gorman, Pomerent & Schick, P.C.
                                         5335 Wisconsin Avenue, N.W.
                                         Washington, D.C. 20015






                                       49
<PAGE>
Annual and Other Report

The Company is required to file an annual report on Form 10-KSB with the
Securities and Exchange Commission. Copies of the Form 10-KSB, annual report and
the Company's quarterly reports may be obtained without charge by contacting:

      Tricia Cassity
      AMB Financial Corp.
      8230 Hohman Avenue
      Munster, Indiana 46321
      (219) 836-5870






































                                       50