Exhibit 13

                                  Annual Report


<PAGE>
                                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 .............................................16

Consolidated Financial Statements ........................................17

Stockholder Information ..................................................50

Corporate Information ....................................................51




                                       1
<PAGE>
President's Message
to Our Stockholders

On behalf of the Board of  Directors,  Officers and  Employees of AMB  Financial
Corp., and its wholly owned subsidiary,  American Savings, FSB., I am pleased to
present our 1997 Annual Report.

AMB  Financial  Corp.,  trading on the NASDAQ (Small Cap) Stock Market under the
symbol  "AMFC",   closed  at  $15.875  on  December  31,  1997  an  increase  of
approximately  20% over the $13.25 price on December 31, 1996.  Earnings for the
year ended December 31, 1997 were $1,023,000 or $1.12 per basic share.

The Bank set goals for 1997 to enhance  shareholder value,  increase deposit and
lending volume and improve  operating ratios.  The Bank experienced  strong loan
growth of $9.7  million  (14.4%),  deposit  growth of $11.3  million (18 7%) and
total asset  growth of $13.7  million  (15.9%) in 1997.  Our basic  strategy for
increasing  shareholder  value is evidenced  by our  performance  ratios.  After
eliminating the 1996 special deposit  insurance  premium,  our return on average
assets  increased to 1 07% (27.4%),  return on average equity increased to 7.06%
(40.6%),  operating  expense to average assets ratio dropped to 2.80% (8.8%) and
efficiency ratio decreased to 60.28% (14.2%).

We are continually working to develop goals and long-term strategies to increase
profitability,  minimize risk,  control expenses and enhance  shareholder value.
Our primary focus continues to be directed towards enhancing  shareholder equity
value while remaining a viable,  independent banking concern,  serving the needs
of the residents and businesses in Northwest Indiana.

Our financial  performance and stock performance is available on our web site at
http://www.ambfinancial.com.  Any comments on  improving  this site are actively
solicited.

The entire staff of AMB Financial Corp. 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
<TABLE>
<CAPTION>
                                                                   At December 31,
                                            -----------------------------------------------------------
                                             1997         1996          1995         1994        1993
                                            -----------------------------------------------------------
                                                                           (In thousands)
<S>                                         <C>          <C>          <C>          <C>          <C>
Selected Financial Data:
Total assets                                $99,796      $86,102      $69,788      $65,536      $65,130
Loans receivable, net                        77,093       67,366       54,639       51,849       48,602
Investment securities                         8,214        8,939        7,017        6,316        7,281
Mortgage-backed securities                    3,494        4,019        1,479        1,593        2,362
Trading account securities                    2 413          539         --           --           --
Deposits                                     71,700       60,411       59,588       58,281       59,086
Borrowed funds                               12,000        9,500        3,000        1,000         --
Stockholder's equity                         14,770       15,170        6,314        5,633        5,393
<CAPTION>
                                                               Year Ended December 31,
                                            -----------------------------------------------------------
                                                                    (In thousands)
<S>                                         <C>          <C>          <C>          <C>          <C>
Selected Operating Data:
Total interest income                       $ 7,156      $ 5,957      $ 5,222      $ 4,837      $ 4,915
Total interest expense                        3,793        2,955        2,686        2,209        2,240
                                            -------      -------      -------      -------      -------
  Net interest income                         3,363        3,002        2,536        2,628        2,675
Provision for loan losses                        74         --             39           62          169
                                            -------      -------      -------      -------      -------
Net interest income after provision
 for loan losses                              3,289        3,002        2,497        2,566        2,506
                                            -------      -------      -------      -------      -------
  Non-interest income:
Fees and service charges                        349          263          203          224          199
Commission income                                78           57           59           23           69
Gain on sale of securities                       58           53         --             59           19
Unrealized gain on investments                  531           46         --           --           --
Gain on sale of real estate owned                 5           28            2          178         --
Other                                            81           64           76           89           93
                                            -------      -------      -------      -------      -------
  Total non-interest income                   1,102          511          340          573          380
                                            -------      -------      -------      -------      -------
Non-interest expense:
Compensation and benefits                     1,294        1,129          909          886          880
Office occupancy and equipment expense          353          334          328          347          340
Data processing                                 336          295          248          210          207
Federal deposit insurance                        41          130          134          134          116
SAIF special assessment                        --            389         --           --           --
Stock conversion expenses                      --           --           --            332         --
Provision for loss on REO                      --           --           --           --            147
Other                                           669          580          595          608          588
                                            -------      -------      -------      -------      -------
  Total non-interest expense                  2,693        2,857        2,214        2,517        2,278
                                            -------      -------      -------      -------      -------

Income before income taxes                    1,698          656          623          622          608
Income tax provision                            675          214          236          239          228
                                            -------      -------      -------      -------      -------
Net income                                    1,023          442          387          383          380
                                            -------      -------      -------      -------      -------
</TABLE>


                                       3
<PAGE>

<TABLE>
<CAPTION>
                                                          ---------------------------------------------------
                                                           1997        1996        1995       1994      1993
                                                          ---------------------------------------------------
<S>                                                       <C>         <C>         <C>        <C>        <C>
Selected Financial Ratios and Other Data:
Return on average assets (1)                                1.07%       .55%        .57%       .58%       .59%
Return on average stockholders'                             7.06        3.28       6.40       6.74       7.24
equity(2)
Average stockholders' equity to
 average assets                                            15.10       16.78       8.76       8.61       8.20
Stockholders' equity to total assets                       14.77       17.62       9.05       8.60       8.28
Interest rate spread during period                          3.14        3.37       3.84       4.11       4.30
Net interest margin (3)                                     3.71        3.97       4.03       4.25       4.45
Operating expenses to average assets (4)                    2.80        3.56       3.29       3.31       3.33
Efficiency ratio (5)                                       60.28       70.23      76.99      73.72      70.19
Non-performing assets to total assets                       0.33        0.35       0.53       0.76       0.88
Allowance for loan losses to non performing loans         133.12      116.27      97.43      66.00      52.15
Allowance for loan losses to loans
 receivable, net                                            0.53        0.53       0.66       0.62       0.55
Ratio of average interest-earning
 assets to average interest-bearing                         1.14x       1.16x      1.04x      1.04x      1.04x
 liabilities
Number of full-service offices                              4           4          4          4          4
</TABLE>

(1)  Return on average  assets for 1996  would have been .84%  without  the SAIF
     special assessment.

(2)  Return on  average  stockholders'  equity  for 1996  would  have been 5.02%
     without the SAIF special assessment.

(3)  Calculation  is based upon net interest  income  before  provision for loan
     losses divided by interest earning assets.

(4)  For purposes of calculating this ratio, operating expenses for 1993 exclude
     the  provision  for losses on real  estate  owned and for 1994  exclude the
     write-off  of stock  conversion  expenses.  The 1996 ratio  would have been
     3.07% without the SAIF special assessment.

(5)  Non-interest expense, excluding the provision for loss on real estate owned
     in 1993,  the write-off of stock  conversion  expenses in 1994 and the SAIF
     special  assessment  in 1996,  divided by net  interest  income  plus other
     income except for gains and losses on securities available for sale.

                                       4
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

General

         AMB  Financial  Corp.  (the  "Company") is the unitary  thrift  holding
company for American Savings FSB, (the "Bank"),  a federally  chartered  savings
bank and a wholly-owned  subsidiary of the Holding  Company.  Collectively,  the
Holding  Company and the Bank are referred to herein as the  "Company." On March
29, 1996,  the Bank converted from a mutual savings bank to a stock savings bank
(the "Conversion").  Concurrent with the Conversion,  the Company sold 1,124,125
shares of its common stock in a subscription  and community  offering at a price
of $10.00 per share.

         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 three full-service banking offices located
in Dyer,  East Chicago 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  multi-family,   commercial  real  estate,  consumer,   commercial  business,
construction,   construction  and  land  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.  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, fees on
deposit and loan  products  and, on occasion,  securities  gains.  The Company's
non-interest  expenses primarily consist of employee  compensation and benefits,
occupancy  and  equipment  expenses,   federal  deposit  insurance  costs,  data
processing service fees and other operating expenses.

         The  Company's  results of  operations  are  significantly  affected by
general  economic and  competitive  conditions  (particularly  changes in market
interest  rates),  government  policies,  changes in  accounting  standards  and
actions of regulatory agencies.  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 and supply of housing,  competition
among  lenders,  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 an independent,
community-oriented financial institution 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
multi-family,

                                       5
<PAGE>
commercial real estate,  consumer,  commercial  business,  construction and land
loans;  (iii) augment its lending activities with investments in mortgage-backed
and other  securities;  (iv) emphasize  adjustable  rate and/or short and medium
duration assets; (v) build and maintain its regular savings, transaction,  money
market and club accounts;  and (vi)  increase,  at a managed pace, the volume of
the Company's assets and liabilities.

Comparison of Financial Conditions at December 31, 1997 and 1996.

         Total assets of the Company  increased $13.7 million in the year ending
December 31, 1997,  from $86.1  million in 1996 to $99.8  million in 1997.  This
increase of 15.9% was primarily  attributable to the Company's loan growth.  The
Company's  asset  growth was funded by an increase in savings  deposits of $11.3
million and additional  advances from the FHLB of  Indianapolis in the amount of
$2.5 million.

         Cash and cash  equivalents  increased  by $3.1  million at December 31,
1997 as  excess  funds  received  from  the  deposit  growth  were  retained  in
anticipation of loan funding and for general liquidity purposes.

         Investment  securities  available for sale  decreased  $700,000 to $8.2
million at December 31, 1997 as a result of investment sales of $4.0 million and
$750,000 in proceeds  from  maturing  securities  offset by $4.0  million in new
purchases. These sales were from a medium term U.S. Government mutual fund while
the new purchases  were  primarily in the same fund and to a lesser  extent,  in
medium term U.S. Treasury notes.

         Loans  receivable  increased  to $77.1  million at December 31, 1997, a
$9.7 million or 14.4% increase, as new loan originations of both residential and
non-residential  loans  of $19.9  million  and loan  purchases  of $6.9  million
exceeded  loan  repayments  of  $16 9  million  (See  note  5 of  the  Notes  to
Consolidated  Financial  Statements).  Although loan  originations and purchases
were slightly lower than during 1996, the Company continues to remain focused on
an  aggressive  lending  effort as  evidenced by the better than 40% increase in
loans receivable over the last two years.

         Total  deposits at December  31, 1997  increased by $11.3  million,  or
18.7%, due to net deposit receipts of $8.9 million and interest credited of $2.4
million.  The  deposit  growth  was  primarily  attributable  to  the  Company's
continued  aggressive  advertising and competitive rates with regards to special
certificate promotions (primarily 9, 11, and 14 month terms) during 1997.

         Borrowed  funds,  which  consist  of  FHLB  of  Indianapolis  advances,
increased  $2.5 million to $12.0  million at December 31, 1997.  The increase in
borrowed funds was utilized to fund loam production during the year. Most of the
new borrowings were at maturity terms of three years.

         Stockholders'  equity  decreased  $400,000 to $14.8 million at December
31, 1997 form $15.2  million at December 31, 1996.  This  decrease was primarily
due to the  buyback  of  treasury  stock in the amount of $1.5  million  and the
declaration of dividends on stock of $230,000, which was offset by net income of
$1.0  million,  an  increase  of $41,000 in the  unrealized  gain on  securities
available for sale and normal amortization of RRP and ESOP benefits of $204,000.

                                       6
<PAGE>
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  averages  balances  are monthly  average  balances  and include
non-accruing  loans.  Management  does not  believe  that  the use of  month-end
balances instead of daily average  balances has caused any material  differences
in the information presented.
<TABLE>
<CAPTION>
                                                                 Year Ended December 31
                                                                 (Dollars in thousands)
                                      --------------------------------------------------------------------------
                                                       1997                                  1996
                                      --------------------------------------------------------------------------
                                        Average      Interest                  Average      Interest
                                      Outstanding     Earned/      Yield/    Outstanding     Earned/     Yield/
                                        Balance        Paid        Rate        Balance        Paid        Rate
                                      --------------------------------------------------------------------------
<S>                                     <C>          <C>           <C>         <C>          <C>           <C>
Interest-Earning Assets
 Loans receivable (1)                    71,473        6,003       5.40%        59,165        4,949       8.36%
 Mortgage-backed securities               3,783          257       8.79%         3,396          230       6.77%
 Investment securities                   10,494          620       5.91%         8,565          521       6.08%
 Interest-bearing deposits                4,135          223       5.39%         3,876          214       5.52%
 FHLB stock                                 658           53       8.05%           546           43       7.88%
                                      --------------------------------------------------------------------------
 Total interest-earning assets          $90,543      $ 7,156       7.90%       $75,548      $ 5,957       7.89%
                                      --------------------------------------------------------------------------
Interest-Bearing Liabilities
Passbook accounts                        16,407          488       2.97%        16,490          510       3.09%
Demand and NOW accounts                   9,642          233       2.42%         9,258          226       2.44%
Certificate accounts                     42,051        2,378       5.66%        36,389        2,025       5.56%
Borrowings                               11,629          693       5.96%         3,186          194       6.09%
                                      --------------------------------------------------------------------------
Total interest-bearing liabilities      $79,729      $ 3,792       4.76%       $65,323        2,955       4.52%
                                        =======      -------       ----        =======        -----       ----
Net interest income                                  $ 3,364                                 $3,002
                                                     =======                                 ======
Net interest rate spread                                           3.14%                                  3.37%
                                                                   ====                                   ====
Net earning assets                      $10,814                                $10,225
                                        =======                                =======
Net yield on average
interest-earning assets                                            3.71%                                  3.97%
                                                                   ====                                   ====
Average interest-earning assets to
average interest-bearing liabilities                   1.14x                                 1.16x
                                                       ====                                  ====
<PAGE>
<CAPTION>
                                               Year Ended December 31
                                               (Dollars in thousands)
                                      -------------------------------------
                                                     1995
                                      -------------------------------------
                                        Average     Interest
                                      Outstanding    Earned/        Yield/
                                        Balance       Paid           Rate
                                      -------------------------------------
<S>                                     <C>          <C>             <C>
Interest-Earning Assets
 Loans receivable (1)                    53,107        4,570         8.61%
 Mortgage-backed securities               1,587          106         6.68%
 Investment securities                    6,383          418         6.55%
 Interest-bearing deposits                1,369           85         6.21%
 FHLB stock                                 546           43         7.88%
                                      -------------------------------------
 Total interest-earning assets          $62,992      $ 5,222         8.29%
                                      -------------------------------------
Interest-Bearing Liabilities
Passbook accounts                        16,597          544         3.28%
Demand and NOW accounts                   8,969          245         2.73%
Certificate accounts                     33,240        1,799         5.41%
Borrowings                                1,567           98         6.25%
                                      -------------------------------------
Total interest-bearing liabilities      $60,373        2,686         4.45%
                                        =======        -----         ----
Net interest income                                   $2,536
                                                      ======
Net interest rate spread                                             3.84%
                                                                     ====
Net earning assets                      $ 2,619
                                        =======
Net yield on average
interest-earning assets                                              4.03%
                                                                     ====
Average interest-earning assets to
average interest-bearing liabilities                  1.04x
                                                      ====
</TABLE>

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

         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.

                                       7
<PAGE>
<TABLE>
<CAPTION>
                                                                         Year Ended December 31,
                                                                         -----------------------
                                               1997 Compared to 1996                                1996 Compared to 1995
                                             Increase (Decrease) Due to                          Increase (Decrease) Due to
                                             --------------------------                          --------------------------
                                                 Rate/                                                             Rate/
                                     Rate       Volume       Volume        Net          Rate        Volume        Volume       Net
                                     ----       ------       ------        ---          ----        ------        ------       ---
                                                                      (Dollars in thousands)
<S>                                  <C>        <C>          <C>          <C>           <C>         <C>           <C>          <C>
Interest-earning assets:
Loans Receivable, net                 21        1,029            4        1,054         (128)         522          (15)         379
Mortgage-backed
 securities                            1           26          --            27            1          121            2          124
investment securities                (15)         117           (3)          99          (30)         143          (10)         103
interest-bearing deposit              (5)          14          --             9          (10)         156          (17)         129
FHLB Stock                             1            9          --            10          --           --           --           --
                                     ---        -----         ----        -----         ----         ----         ----         ----
  Totals                               3        1,195            1        1,199         (167)         942          (40)         735
                                     ---        -----         ----        -----         ----         ----         ----         ----

Interest-bearing liabilities:
Passbook accounts                    (20)          (2)         --           (22)         (31)          (3)         --           (34)
Demand and Now
 accounts                             (2)           9          --             7          (26)           8           (1)         (19)
Certificate accounts                  33          315            5          353           51          107            5          226
Borrowed funds                        (4)         514          (11)         499           (2)         101           (3)          96
                                     ---        -----         ----        -----         ----         ----         ----         ----
  Totals                               7          836           (6)         837           (8)         114            1          269
                                     ---        -----         ----        -----         ----         ----         ----         ----
   Net change in net
    interest  income                                                        362                                                 466
                                                                            ---                                                 ---
</TABLE>

Comparison of Operating Results for the Years Ended December 31,1997 and 1996.

Net Income.  The Company's  net income for the year ended  December 31, 1997 was
$1.0 million as compared to S442,000 for the same period in 1996, an increase of
$581,000.  This increase was due primarily to an increase in net interest income
of $361,000,  an increase in non-interest  income of $587,000,  and a decrease m
non-interest expense of $167,000,  offset by an increase of $74,000 in provision
for loan losses and an increase of $461,000 in tax  provisions  . Net income for
the year ended December 31, 1996 was reduced by a one-time special assessment of
$389,000  ($234,000 after taxes) imposed by federal  legislation to recapitalize
the Savings Association insurance Fund ("SAIF").

Interest  Income.  Total  interest  income for the year ended  December 31, 1997
increased $1.2 million or 20.1%,  as compared to the prior year. The increase in
interest income was the result of an increase in average interest earning assets
of $15.0 million. The increase in average interest-earning assets was the result
of a $12.3  million  increase  in the  average  balance of loans  receivable,  a
$387,000 increase in the average balance of mortgage-backed  securities,  a $1.9
million  increase in the average  balance of investment  securities,  a $259,000
increase in the average balance of  interest-bearing  deposits,  and a $ 112,000
increase  in the  average  balance of FHLB stock.  These  increases  reflect the
Company's  investment of net proceeds from an increase in the average balance of
interest-bearing  liabilities,  as well  as a full  year  of  investment  of the
proceeds of the Company's  March 31,1996 stock  offering.  During the year ended
December  31,  1997,  the average  yield on interest  earning  assets  increased
slightly to 7.90% from 7.89% during the year ended December 31, 1996.

                                       8
<PAGE>
Interest  Expense.  Total interest  expense for the year ended December 31, 1997
increased $837,000,  or 28 3% to $3.8 million as compared to $3.0 million in the
prior year. Deposit interest increased by $338,000, primarily as a result of the
$6.0 million  increase in the average  balance of deposit  accounts and the .11%
increase in the cost of deposits. The average certificate deposit base increased
by $5.7  million in 1997 as the Bank offered  special  premium  rates.  Interest
expense on borrowed  funds  increased  $499,000,  to $693,000 for the year ended
December 31, 1997. The average  balance of borrowed funds increased $8.4 million
to $11.6 million for the year ended December 31, 1997.  This increase was due to
funding  requirements  for new mortgage  loans and to a lesser extent for normal
operating liquidity.

Provision 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  deemed
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  judgment,  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.

Provision of $74,000 was recorded  during the year ended December 31, 1997 while
no provision  was recorded in the  comparable  1996 period.  The increase in the
provision for losses on loans was due to the growth in the loan portfolio and is
based  upon  management's  review of the loan  portfolio  by  property  type and
delinquency status. There were no significant individual loans which contributed
to the  increase in the  allowance,  and there were no  regulato r requests  for
additional  provisions for loan losses during the year ended December 31 1997 or
1996 The Bank will  continue  to review its  allowance  for loan losses and make
future provisions as economic and regulatory  conditions  dictate.  Although the
Bank  maintains its allowance for loan losses at a level that it considers to be
adequate to provide for losses,  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 $591,000 to
$1.1 million for the year ended  December 31, 1997  compared to $511,000 for the
previous year. The increase was due primarily to an increase in unrealized gains
on investment  securities available for trade of $485,000,  due primarily to the
effect of  favorable  market  conditions  on a thrift  equity  fund in which the
Company has an interest, a gain of $36,000 on the sale of investment  securities
held for trade,  and an  increase  in  deposit  related  fees of $86,000  due to
general increases in many service fee categories.

Non-Interest  Expense. The Company's  non-interest expense decreased $164,000 to
$2.7 million for the year ended  December 31, 1997  compared to $2.9 million for
the previous year.  The decrease was primarily the result of a $390,000  charge,
reflected in the 1996 period,  for the special insurance  assessment  imposed by
the FDIC to recapitalize  the SAIF. As a result of the  recapitalization  of the
SAIF, quarterly insurance premiums decreased by $89,000 as compared to the prior
year  period.  This  decrease  in cost was  partially  offset by an  increase in
staffing  costs of  $165,000  during the year due to normal  salary and  benefit
increases and increases in the expense  recognition of the ESOP and the RRP, and
an increase in advertising costs of $44,000 associated with the marketing of the
special certificate of deposit program and loan solicitations.  The ESOP expense
increased  because of the increase of the stock price as well as the maintenance
of the plan for an entire year rather than nine months as was the case for 1996.
The RRP expense increased because that plan was not implemented until October of
1996. In addition data processing  costs increased  $40,000  associated with the
servicing  and  maintenance  of the new ATM  machines and  increased  debit card
activity, and other operating expenses increased $80,000 primarily


                                       9
<PAGE>
reflecting increased expenses relating to operations as a public company for the
full year.

Provision  for Income  Taxes.  Tax expense for the year ended  December 31, 1997
increased  $461,000 to $675,000  compared to $214,000 for the comparable year in
1996.  Income taxes increased  primarily as a result of increased  income before
taxes.


Comparison of Operating Results for the Years Ended December 31,1996 and 1995.

Net Income.  The Company's  net income for the year ended  December 31, 1996 was
$442,000 as compared  to  $387,000  for the same period in 1995,  an increase of
$55,000.  This increase was due primarily to an increase in net interest  income
of $465,000, and an increase in non-interest income of $171,000,  offset in part
by an  increase in  non-interest  expense of  $642,000.  Net income for the year
ended December 31, 1996 was reduced by a one-time special assessment of $390,000
($234,000  after  taxes)  imposed by federal  legislation  to  recapitalize  the
Savings Association Insurance Fund ("SAIF").

Interest  Income.  Total  interest  income for the year ended  December 31, 1996
increased  $735,000,  or 14.1%,  as compared to the prior year.  The increase in
interest income was the result of an increase in average interest-earning assets
of $12.6 million. The increase in average interest-earning assets was the result
of a $6.1 million  increase in the average balance of loans  receivable,  a $1.8
million increase in the average balance of  mortgage-backed  securities,  a $2.2
million  increase in the average  balance of  investment  securities  and a $2.5
million  increase in the average  balance of  interest-bearing  deposits.  These
increases  reflect the Company's  investment  of net proceeds  received from the
stock  conversion  as well  as  from  an  increase  in the  average  balance  of
interest-bearing  liabilities.  During the year ended  December  31,  1996,  the
average yield on interest-earning assets declined to 7.89% from 8.29% during the
year ended December 31, 1995. The decline in yield on average  interest  earning
assets was due primarily to a higher  proportion of lower  yielding  investments
acquired as a result of investing the stock conversion proceeds.

Interest  Expense.  Total interest  expense for the year ended December 31, 1996
increased  $270,000,  or 10% to $3.0  million as compared to $2.7 million in the
prior year.  Deposit interest  increased by $ 173,000,  primarily as a result of
the $3.3  million  increase in the average  balance of deposit  accounts and the
 .04%  increase in the cost of  savings.  The average  certificate  deposit  base
increased by $3.1 million in 1996 as the Bank offered  limited  special  premium
rates and  solicited  new  public  funds.  Interest  expense on  borrowed  funds
increased  $97,000,  or double to $194,000 for the year ended December 31, 1996.
The average balance of borrowed funds increased $1.6 million to $3.2 million for
the year ended December 31, 1996. This increase was due to funding  requirements
for new mortgage loans and to a lesser extent for normal operating liquidity.

Provision for Loam Losses.  No provision for loan losses was recorded during the
year ended  December  31,  1996 while a $39,000  provision  was  recorded in the
comparable  1995 period.  The decrease in the  provision for losses on loans was
due to the  continued  low level of past due and  problem  loans.  The Bank will
continue to review its allowance  for loan losses and make future  provisions as
economic and  regulatory  conditions  dictate.  Although the Bank  maintains its
allowance for loan losses at a level that it considers to be adequate to provide
for  losses,  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.  TheCompany'snon-interest  income  increased  $173,000  to
$511,000 for the year

                                       10
<PAGE>
ended December 31, 1996 compared to $340,000 for the previous year. The increase
was due primarily to an increase in loan fees of $29,000  resulting  from higher
loan  volume,  an  increase  in deposit  related  fees of $30,000 due to general
increases  in many  service  fee  categories,  gains on the  sale of  investment
securities  available for sale of $53,000,  an unrealized gam on securities held
for trade of $46,000,  and gain on sale of real estate owned of $26,000,  offset
by a decrease in other operating income of $12,000.

Non-Interest  Expense. The Company's  non-interest expense increased $642,000 to
$2.8 million for the year ended  December 31, 1996  compared to $2.2 million for
the previous year. The increase  primarily  resulted from a $389,000  charge for
the  amount  of the  special  insurance  assessment  to  recapitalize  the SAIF.
Staffing costs also increased $220,000 during the year due to salary and benefit
increases of $ 103,000, the expense recognition of the ESOP of $ 101,000 and the
RRP of $  16,000.  In  addition  there was  approximately  $94,000  of  expenses
relating to operations  as a public  company which did not occur in the previous
year.

Provision  for Income  Taxes.  Tax expense for the year ended  December 31, 1996
decreased  $22,000 to $214,000  compared to $236,000 for the comparable  year in
1995.  Income taxes decreased by $32,000  primarily as a result of a decrease in
the effective tax rates between the periods.


Quantitative 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
nsk mherent in the  asset11iability  structure;  and (iii) modify the  Company's
asset/liability  structure,  as  necessary,  to  manage  interest  rate risk and
maintain net interest margins in changing rate environments. Management seeks to
reduce  the  vulnerability  of the  Company's  operating  results  to  changes m
interest  rates and to manage the ratio of  interest  rate  sensitive  assets to
interest  rate  sensitive  liabilities  with  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. Even though such activity
may be permitted  with the approval of the Board of Directors,  management  does
not intend to engage in such activity in the immediate future.

Notwithstanding  the Company's  interest  rate nsk  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 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.  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 continues to believe 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"),  provide  high enough  returns to justify the  increased
exposure to sudden

                                       11
<PAGE>
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  adjustable-rate  loans.  At
December 31, 1997,  adjustable-rate loans represented $26.7 million or 33.55% of
the  total  loan  portfolio.  Second,  most  of the  mortgage-backed  securities
purchased by the Company in recent years had  adjustable  interest  rates and/or
short or  intermediate  effective  terms to maturity,  At December 31, 1997, the
Company had $700,000 of adjustable-rate mortgage-backed pass-through securities,
with anticipated  lives of five years or less.  Third, a significant  portion of
the  Company's  other debt  securities  (primarily  U.S.  Government  and agency
securities)  are short- or  intermediate-term  instruments  with $7.7 million of
such securities  contractually  maturing within five years of December 31, 1997.
Fourth,  the Company bas 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, 1997, the Company bad
$16.4 million of regular savings accounts, $2.9 million of money market accounts
and $7.3 million of NOW,  checking and club  accounts.  Overall,  these accounts
comprised 37.0% of the Company's total deposit base.

One  approach  used by  management  to  quantify  interest  rate risk is the net
portfolio  value  ("NPV")  methodology  used by the  OTS as part of its  capital
regulations.  NPV  is  generally  considered  to be  the  present  value  of the
difference  between expected incoming cash flows on  interest-earning  and other
assets and expected incoming cash flow on interest-earning  and other assets and
expected  outgoing cash flows on  interest-bearing  and other  liabilities.  The
application  attempts  to quantify  interest  rate risk as the change in the NPV
which would  result  form a  theoretical  200 basis point (1 basis point  equals
 .01% change in market interest rates.

Presented  below, as of December 31, 1997, 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 m the table,
NPV is more  sensitive to rising  rates than  declining  rates.  From am 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 Company would pay on its
deposits would increase  rapidly because the Company's  deposits  generally have
shorter periods to repricing.

                                       12
<PAGE>
<TABLE>
<CAPTION>
         Change in Interest Rates          Estimated NPV        Estimated Increase (Decrease) in NPV
               (Basis Points)                 Amount                   Amount          Percent
               --------------                 ------                   ------          -------
                                              (Dollars in thousands)

<S>                 <C>                       <C>                     <C>               <C>
                   +400                       $ 8,229                 $(4,958)          (38)
                   +300                         9,591                  (3,596)          (27)
                   +200                        10,942                  (2,245)          (17)
                   +100                        12,196                    (991)          ( 8)
                    ---                        13,187
                   -100                        13,877                     690             5
                   -200                        14,419                   1,232             9
                   -300                        15,108                   1,921            15
                   -400                        16,033                   2,846            22
</TABLE>

         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  will 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 NPV than 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 an  indication of the
timing of the receipt 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  activities of the Company are the origination of
real  estate and other  loans,  and the  purchase of  mortgage-backed  and other
securities.  During the years ended  December 31, 1997,  and 1996, the Company's
disbursements  for loan  originations  totaled $19.9 million,  and $22.9 million
respectively.  For the years ended  December  31, 1997,  and 1996,  purchases of
mortgage-backed  securities  totaled  $0 and  $3.0  million,  respectively,  and
purchases  of  other   securities   totaled  $4.0  million  and  $3.1   million,
respectively.  These  activities were funded  primarily by net deposit  inflows,
borrowings and principal repayments on loans and securities.

         For  the  years  ended   December  31,  1997,  and  1996,  the  Company
experienced  net  increases  in  deposits  (including  the  effect  of  interest
credited) of $11.3 million,  and $800,000  respectively.  The increase in fiscal
1997 reflects a concerted effort to increase the deposit base through  marketing
local

                                       13
<PAGE>
special  rate  certificates  for  periods of 9 through 21  months.  The  nominal
increase  in fiscal  1996  reflected  relatively  flat  market  interest  rates,
customer  preference  for  alternative  investments,  and deposits  withdrawn to
purchase stock in the Conversion.  Proceeds from FHLB advances were $7.0 million
in fiscal 1997,  and $8.5 million in fiscal 1996.  FHLB advances of $4.5 million
and $2.0 million were repaid in fiscal 1997 and 1996 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, 1997,  the Company's  borrowing  limit from the
FHLB of Indianapolis  was  approximately  $30.0 million,  with unused  borrowing
capacity of $ 18.0 million at that date.

         The Company is required to maintain an average  daily balance of liquid
assets as a percentage of net  withdrawable  deposit  accounts  plus  short-term
borrowings  as  defined  by OTS  regulations.  The  minimum  required  liquidity
liquidity  ratio is currently 4.0%. At December 31, 1997 and 1996, the Company's
liquidity ratio was 16.3%, and 15.4% respectively.

         The Company's most liquid assets are cash and cash  equivalents,  which
include mainly 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,  1997  and  1996,  cash  and cash
equivalents totaled $5.7 million and $2.6 million, respectively.

         At December  31, 1997,  the Company had  outstanding  loan  origination
commitments  of  $95,000,  undisbursed  construction  loans in  process  of $2.0
million and approved  but unused  lines of credit  extended to customers of $4.3
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, 1997  totaled  $36.4
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 regulations require savings associations,  such as the Bank, to
meet two minimum capital  standards:  a leverage ratio  requirement of 3 - 4% of
core capital to such  adjusted  total  assets;  and a risk-based  capital  ratio
requirement of 8% of core and supplementary  capital to total risk-based assets.
The Bank  satisfied  these minimum  capital  standards at December 31, 1997 with
tangible and leverage  capital  ratios of 9.76% and a total  risk-based  capital
ratio of 18.51%. In determining the amount of risk-weighted  assets for purposes
of  the  risk-based  capital  requirement,  a  savings  bank  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.  In  September  1997 the Bank paid a dividend of $2.5 million to the
Company.  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

                                       14
<PAGE>
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 Notes  thereto  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.

Impact of New Accounting Standards

           Accounting  for  Transfers  and  Servicing  of  Financial  Assets and
Extinguishments  of Liabilities.  In December 1996, the FASB issued Statement of
Financial Accounting Standards No. 127 ("SFAS 127"),  "Deferral of the Effective
Date of Certain  Provisions of FASB Statement No. 125". The statement delays for
one year the implementation of SFAS 125, as it relates to (1) secured borrowings
and  collateral  and (2) for the transfers of financial  assets that are part of
repurchase   agreements,   dollar-rolls,    securities   lending   and   similar
transactions.  The Company has adopted  portions of SFAS 125 (those not deferred
by SFAS 127) effective January 1, 1997.  Adoption of these portions did not have
a  significant  effect  on the  Company's  financial  condition  or  results  of
operations.  Based on its review of SFAS 125,  management  does not believe that
adoption of the  portions of SFAS 125 which have been  deferred by SFAS 127 will
have a material effect on the Company.

         Reporting Comprehensive Income. In June 1997, the FASB issued Statement
of Financial  Accounting  Standards No. 130,  "Reporting  Comprehensive  income"
("SFAS 130"). This statement  establishes standards for reporting and display of
comprehensive income and its components (revenues, expenses, gains, losses) in a
full set of  general-purpose  financial  statements.  SFAS 130 is effective  for
fiscal  years  beginning  after  December  15,  1997.  The  Company  has not yet
determined the impact of adopting this statement.

           Disclosures About Segments of an Enterprise and Related  Information.
In June 1997, the FASB issued  Statement of Financial  Accounting  Standards No.
131,  "Disclosures  about  Segments of an  Enterprise  and Related  Information"
("SFAS 131 ") which becomes  effective for fiscal years beginning after December
15,  1997.  SFAS 131  establishes  standards  for the way that  public  business
enterprises report information about operating segments and requires enterprises
to report selected  information  about operating  segments in interim  financial
reports.  The  Company  has not yet  determined  the  impact  of  adopting  this
statement.

                                       15
<PAGE>
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.

                                       16
<PAGE>








                               AMB FINANCIAL CORP.
                                AND SUBSIDIARIES

                          Audited Financial Statements

                                December 31, 1997


<PAGE>



                               AMB FINANCIAL CORP.
                                AND SUBSIDIARIES



                                    Contents





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


Consolidated Statements of Financial Condition,
  as of December 31, 1997 and 1996..............................................


Consolidated Statements of Income, years ended
  December 31, 1997, 1996 and 1995..............................................


Consolidated Statements of Changes in Stockholders' Equity,
  three years ended December 31, 1997...........................................


Consolidated Statements of Cash Flows, years ended
  December 31, 1997, 1996 and 1995..............................................


Notes to Consolidated Financial Statements......................................


<PAGE>

                          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, 1997 and 1996 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, 1997.
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 generally  accepted auditing
standards.  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, 1997 and 1996, and the results
of their  operations  and their  cash  flows for each of the three  years in the
period  ending  December  31,  1997,  in  conformity  with  generally   accepted
accounting principles.




/s/Cobitz, Vandenberg & Fennessy
--------------------------------
Cobitz, Vandenberg & Fennessy


February 13, 1998
Palos Hills, Illinois
<PAGE>
<TABLE>
<CAPTION>
                                                       AMB FINANCIAL CORP.
                                                        AND SUBSIDIARIES
                                         Consolidated Statements of Financial Condition
                                                                                                   1997              1996
                                                                                               -----------        ----------
<S>                                                                                         <C>                   <C>
Assets

Cash and amounts due from depository institutions                                           $    2,510,527         1,473,962
Interest-bearing deposits                                                                        3,176,428         1,093,405
                                                                                            --------------    --------------
    Total cash and cash equivalents                                                              5,686,955         2,567,367
Investment securities, available for sale,  at fair value (note 2)                               8,213,614         8,938,937
Investment securities held for trade (note 3)                                                    2,412,967           539,500
Mortgage-backed securities, available for sale, at fair value (note 4)                           3,494,035         4,018,835
Loans receivable (net of allowance for loan losses:
   1997 - $410,383; 1996 - $354,631) (note 5)                                                   77,093,229        67,365,632
Real estate owned                                                                                   27,481             -
Stock in Federal Home Loan Bank of Indianapolis                                                    725,400           545,600
Office properties and equipment - net (note 6)                                                     471,730           510,603
Accrued interest receivable (note 7)                                                               533,509           452,955
Prepaid expenses and other assets (note 8)                                                       1,136,860         1,162,631
                                                                                            --------------         ---------

    Total assets                                                                                99,795,780        86,102,060
                                                                                            ==============     =============
Liabilities and Stockholders' Equity

Liabilities:
Deposits (note 9)                                                                               71,700,126        60,410,997
Borrowed money (note 10)                                                                        12,000,000         9,500,000
Advance payments by borrowers for taxes and insurance                                              383,237           312,213
Other liabilities  (note 11)                                                                       942,134           708,993
                                                                                            --------------    --------------
    Total liabilities                                                                           85,025,497        70,932,203
                                                                                            --------------    --------------
Stockholders' Equity:
Preferred stock, $.01 par value:  authorized
   100,000 shares; none outstanding                                                                  -                 -
Common stock, $.01 par value:  authorized 1,900,000 shares;
   1,124,125 shares issued and 963,798 shares outstanding at December 31, 1997
   and 1,067,919 shares outstanding at December 31, 1996                                            11,241            11,241
Additional paid-in capital                                                                      10,717,068        10,657,746
Retained earnings, substantially restricted                                                      7,357,250         6,564,204
Unrealized gain on securities available for sale, net of income taxes                               71,061            30,386
Treasury stock, at cost (160,327 and 56,206 shares at December 31, 1997 and 1996)               (2,223,051)         (724,718)
Common stock acquired by Employee Stock Ownership Plan                                            (719,440)         (809,370)
Common stock awarded by Recognition and Retention Plan                                            (443,846)         (559,632)
                                                                                            --------------    --------------
    Total stockholders' equity (notes 15 and 16)                                                14,770,283        15,169,857
                                                                                            --------------    --------------
Commitments and contingencies (notes 18 and 19)

    Total liabilities and stockholders' equity                                              $   99,795,780        86,102,060
                                                                                            ==============    ==============
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
<TABLE>
<CAPTION>
                                                       AMB FINANCIAL CORP.
                                                        AND SUBSIDIARIES
                                                Consolidated Statements of Income

                                                                                         Years Ended December 31,
                                                                         ---------------------------------------------------
                                                                               1997                1996              1995
                                                                           -----------         -----------       -----------
<S>                                                                      <C>                   <C>               <C>
Interest income:
  Interest on loans                                                      $   6,003,470           4,949,491         4,569,803
  Interest on mortgage-backed securities                                       257,542             230,175           106,224
  Interest on investment securities                                            619,754             520,663           417,849
  Interest on interest-bearing deposits                                        222,787             214,295            85,422
  Dividends on Federal Home Loan Bank stock                                     52,699              42,694            42,972
                                                                         -------------           ---------         ---------
     Total interest income                                                   7,156,252           5,957,318         5,222,270
                                                                         -------------           ---------         ---------
Interest expense:
  Interest on deposits                                                       3,099,417           2,760,774         2,587,591
  Interest on borrowings                                                       693,214             194,431            97,925
                                                                         -------------           ---------         ---------
     Total interest expense                                                  3,792,631           2,955,205         2,685,516
                                                                         -------------           ---------         ---------

     Net interest income before provision for loan losses                    3,363,621           3,002,113         2,536,754
Provision for loan losses (note 5)                                              74,243             -                  39,384
                                                                         -------------           ---------         ---------
     Net interest income after provision for loan losses                     3,289,378           3,002,113         2,497,370
                                                                         -------------           ---------         ---------
Non-interest income:
  Loan fees and service charges                                                 98,180              97,576            68,700
  Commission income                                                             77,811              57,491            58,699
  Unrealized gain on trading securities - net                                  531,197              46,484             -
  Gain on sale of investment securities held for trade                          36,066               -                 -
  Gain on sale of investment securities                                         22,264              52,617             -
  Gain on sale of real estate owned                                              4,908              27,821             1,960
  Deposit related fees                                                         250,788             165,114           134,653
  Other income                                                                  80,994              63,700            75,587
                                                                         -------------           ---------         ---------
     Total non-interest income                                               1,102,208             510,803           339,599
                                                                         -------------           ---------         ---------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                                                      AMB FINANCIAL CORP.
                                                        AND SUBSIDIARIES
                                                Consolidated Statements of Income

                                                                                         Years Ended December 31,
                                                                         ---------------------------------------------------
                                                                               1997                1996              1995
                                                                           -----------         -----------       -----------
<S>                                                                      <C>                   <C>               <C>
Non-interest expense:
  Staffing costs (notes 12 and 13)                                           1,294,221           1,128,341           908,837
  Advertising                                                                  126,016              79,967           104,100
  Occupancy and equipment expenses (note 6)                                    353,116             334,286           328,432
  Data processing                                                              335,555             295,258           247,764
  Federal deposit insurance premiums (note 17)                                  41,400             129,639           134,316
  SAIF special assessment (note 17)                                               -                389,255             -
  Other                                                                        543,351             499,731           491,137
                                                                         -------------           ---------         ---------
     Total non-interest expense                                              2,693,659           2,856,477         2,214,586
                                                                         -------------           ---------         ---------

Income before income taxes                                                   1,697,927             656,439           622,383
  Income taxes (note 14)                                                       674,874             214,286           235,700
                                                                         -------------           ---------         ---------

     Net income                                                          $   1,023,053             442,153           386,683
                                                                         =============             =======           =======

Earnings per share -
     Primary                                                             $        1.12                 .43               N/A
     Diluted                                                             $        1.10                 .43               N/A
Dividends declared on common stock                                       $         .25                 .12               N/A

</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
<TABLE>
<CAPTION>
                                                         AMB FINANCIAL CORP.
                                                          AND SUBSIDIARIES

                                     Consolidated Statements of Changes in Stockholders' Equity

                                                 Three Years Ended December 31, 1997

                                                                                 Unrealized
                                                                                Gain (Loss)
                                                                                    on
                                                  Additional                     Securities
                                      Common       Paid-in        Retained       Available     Treasury      Acquired       Awarded
                                       Stock       Capital         Earnings       For Sale       Stock         by ESOP       by RRP
                                       -----       -------         --------       --------       -----         -------       ------
<S>                                      <C>       <C>             <C>           <C>           <C>         <C>           <C>
Balance at December 31, 1994             $   -            -       5,856,099     (223,557)          -           -             -

Net income                                                          386,683
Adjustment of securities
  available for sale to fair value,
  net of tax effect                                                              294,278
                                        -------   ----------      ---------     --------    ----------    --------      --------

Balance at December 31, 1995                 -            -       6,242,782       70,721           -           -             -

Net income                                                          442,153
Adjustment of securities
  available for sale to fair value,
  net of tax effect                                                              (40,335)
Net proceeds of common stock
  issued in stock conversion             11,241   10,646,866                                              (899,300)
Purchase of treasury stock
  (56,206 shares)                                                                             (724,718)
Purchase of stock for RRP                                                                                               (578,929)
Amortization of award of RRP stock                                                                                        19,297
Contribution to fund ESOP loan                       10,880                                                 89,930
Dividends declared on  common stock                                (120,731)
                                        -------   ----------      ---------     --------    ----------    --------      --------

Balance at December 31, 1996             11,241   10,657,746      6,564,204       30,386      (724,718)   (809,370)     (559,632)

Net income                                                        1,023,053
Adjustment of securities
  available for sale to fair value,
  net of tax effect                                                               40,675
Purchase of treasury stock
  (104,121 shares)                                                                          (1,498,333)
Tax benefit related to vested RRP stock               17,000
Amortization of award of RRP stock                                                                                       115,786
Contribution to fund ESOP loan                        42,322                                                89,930
Dividends declared on  common stock                                (230,007)
                                        -------   ----------      ---------     --------    ----------    --------      --------

Balance at December 31, 1997            $11,241   10,717,068      7,357,250       71,061    (2,223,051)   (719,440)     (443,846)
                                        =======   ==========      =========       ======    ==========    ========      ========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                                                      Total
                                                   ----------
<S>                                                <C>
Balance at December 31, 1994                         5,632,542

Net income                                             386,683
Adjustment of securities
  available for sale to fair value,
  net of tax effect                                    294,278
                                                   -----------

Balance at December 31, 1995                         6,313,503

Net income                                             442,153
Adjustment of securities
  available for sale to fair value,
  net of tax effect                                    (40,335)
Net proceeds of common stock
  issued in stock conversion                         9,758,807
Purchase of treasury stock
  (56,206 shares)                                     (724,718)
Purchase of stock for RRP                             (578,929)
Amortization of award of RRP stock                      19,297
Contribution to fund ESOP loan                         100,810
Dividends declared on  common stock                   (120,731)
                                                   -----------

Balance at December 31, 1996                        15,169,857

Net income                                           1,023,053
Adjustment of securities
  available for sale to fair value,
  net of tax effect                                     40,675
Purchase of treasury stock
  (104,121 shares)                                  (1,498,333)
Tax benefit related to vested RRP stock                 17,000
Amortization of award of RRP stock                     115,786
Contribution to fund ESOP loan                         132,252
Dividends declared on  common stock                   (230,007)
                                                   -----------

Balance at December 31, 1997                        14,770,283
                                                    ==========
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
<TABLE>
<CAPTION>
                                                         AMB FINANCIAL CORP.
                                                          AND SUBSIDIARIES

                                                Consolidated Statements of Cash Flows


                                                                                             Years Ended December 31,
                                                                          ---------------------------------------------------------
                                                                                1997                  1996                  1995
                                                                          -------------         -------------         -------------
<S>                                                                       <C>                   <C>                   <C>
Cash flows from operating activities:
  Net income .....................................................        $   1,023,053               442,153               386,683
  Items not requiring (providing) cash:
   Depreciation ..................................................              153,426               139,808               132,848
   Amortization of cost of stock benefit plans ...................              205,716               120,107                  --
   Amortization of premiums and accretion of discounts ...........                1,858                  (434)               (5,778)
   Net gain on sale of securities ................................              (58,330)              (52,617)                 --
   Net gain on sale of real estate owned .........................               (4,908)              (27,821)               (1,960)
   Provision for loan losses .....................................               74,243                  --                  39,384
   Unrealized gain on securities held for trade ..................             (531,197)              (46,484)                 --
   Purchase of trading account securities ........................           (1,987,144)             (493,016)                 --
   Proceeds from sale of trading account securities ..............              680,940                  --                    --
   Increase (decrease) in deferred income on loans ...............              (25,349)               23,507               (34,771)
   Increase (decrease) in accrued and deferred income taxes ......              347,337               (50,221)              204,700
   Increase in accrued interest receivable .......................              (80,554)              (66,322)              (49,731)
   Increase (decrease) in accrued interest payable ...............               (8,163)               24,739                28,784
   Increase in deferred compensation .............................               79,320                71,069                63,068
   Other, net ....................................................             (188,048)               41,548                 2,572
                                                                          -------------         -------------         -------------

Net cash provided by (for) operating activities ..................             (317,800)              126,016               765,799
                                                                          -------------         -------------         -------------

Cash flows from investing activities:
   Proceeds from sales of investment securities ..................            4,014,689               132,617                  --
   Proceeds from maturities of investment securities .............              750,000             1,000,000               500,000
   Purchase of investment securities .............................           (3,996,048)           (3,056,153)             (798,004)
   Proceeds from repayments of mortgage-backed securities ........              569,678               481,548               207,673
   Purchase of mortgage-backed securities ........................                 --              (3,034,420)                 --
   Purchase of Federal Home Loan Bank stock ......................             (179,800)                 --                    --
   Purchase of loans .............................................           (6,872,966)           (4,647,821)           (3,439,588)
   Loan disbursements ............................................          (19,852,423)          (22,901,235)          (14,920,478)
   Loan repayments ...............................................           16,884,296            14,800,656            15,517,663
   Proceeds from sale of real estate owned .......................              102,702                25,823                49,183
   Property and equipment expenditures, net ......................             (114,553)              (41,467)             (120,181)
                                                                          -------------         -------------         -------------

Net cash provided for investing activities .......................           (8,694,425)          (17,240,452)           (3,003,732)
                                                                          -------------         -------------         -------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                                                         AMB FINANCIAL CORP.
                                                          AND SUBSIDIARIES

                                                Consolidated Statements of Cash Flows


                                                                                             Years Ended December 31,
                                                                          ---------------------------------------------------------
                                                                                1997                  1996                  1995
                                                                          -------------         -------------         -------------
<S>                                                                       <C>                   <C>                   <C>
Cash flows from financing activities:
   Net proceeds from sale of common stock ........................                 --               9,758,807                  --
   Deposit receipts ..............................................          142,882,643           122,368,827           108,637,226
   Deposit withdrawals ...........................................         (134,005,401)         (123,874,056)         (109,461,879)
   Interest credited to deposits .................................            2,411,887             2,328,069             2,132,233
   Proceeds from borrowed money ..................................            7,000,000             8,500,000             3,000,000
   Repayment of borrowed money ...................................           (4,500,000)           (2,000,000)           (1,000,000)
   Increase (decrease) in advance payments
       by borrowers for taxes and insurance ......................               71,024               (12,283)               52,705
   Purchase of treasury stock ....................................           (1,498,333)             (724,718)                 --
   Purchase of RRP stock .........................................                 --                (578,929)                 --
   Dividends paid on common stock ................................             (230,007)             (120,731)                 --
                                                                          -------------         -------------         -------------

Net cash provided by financing activities ........................           12,131,813            15,644,986             3,360,285
                                                                          -------------         -------------         -------------

Net change in cash and cash equivalents ..........................            3,119,588            (1,469,450)            1,122,352

Cash and cash equivalents at beginning of year ...................            2,567,367             4,036,817             2,914,465
                                                                          -------------         -------------         -------------

Cash and cash equivalents at end of year .........................        $   5,686,955             2,567,367             4,036,817
                                                                          =============         =============         =============

Supplemental disclosure of cash flow information:
Cash paid during the year for:
    Interest .....................................................        $   3,800,794             2,930,466             2,656,732
    Income taxes .................................................              310,609               265,709               131,000
  Non-cash investing activities:
    Transfer of loans to real estate owned .......................        $     113,496                  --                  48,463
</TABLE>


See accompanying notes to consolidated financial statements.
<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 generally accepted  accounting
         principles  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.

         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  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 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.
<PAGE>
1)       Summary of Significant Accounting Policies (continued)

         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.

         Investment Securities Held For Trade

         Trading  account   securities  are  carried  at  fair  value,  and  net
         unrealized   gains  and  losses  are  reflected  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 fees 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 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.

         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"  which impose certain  requirements  on the measurement of
         impaired loans. 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.  Substantially all of the Company's lending
         is excluded from the provisions of SFAS 114 and SFAS 118.

         Under these statements,  of the remaining loans which are evaluated for
         impairment  (a loan is  considered  impaired  when,  based  on  current
         information  and events,  it is probable that a creditor will be unable
         to collect all amounts due  according to the  contractual  terms of the
         loan agreement),  there were no material amounts of loans which met the
         definition of an impaired loan during the year ended  December 31, 1997
         and no loans to be evaluated for impairment at December 31, 1997.
<PAGE>
1)       Summary of Significant Accounting Policies (continued)

         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.

         Depreciation and Amortization

         Depreciation  of office  properties and equipment is accumulated on the
         straight line basis over  estimated  lives of the various  assets.  The
         cost of leasehold  improvements  is amortized  using the straight  line
         method over the term of the lease.

         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 of deferred tax assets
         and  liabilities  of a change in tax rates is  recognized in income for
         the period that includes the enactment date.
<PAGE>
1)       Summary of Significant Accounting Policies (continued)

         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.

         Earnings per Share

         The Company  computes its earnings per share (EPS) in  accordance  with
         SFAS No. 128  "Earnings  per  Share".  This  statement  simplifies  the
         standards for computing EPS previously  found in Accounting  Principles
         Board Opinion No. 5 "Earnings  per Share" and makes them  comparable to
         international  EPS standards.  It replaces the  presentation of primary
         EPS with a presentation of basic EPS and fully diluted EPS with diluted
         EPS.

         Basic EPS,  unlike  primary EPS,  excludes  dilution and is computed by
         dividing   income    available   to   common    stockholders   by   the
         weighted-average  number of common shares  outstanding  for the period.
         Diluted  EPS  reflects  the  potential  dilution  that  could  occur if
         securities or other  contracts to issue common stock were  exercised or
         converted into common stock or resulted in the issuance of common stock
         that then shared in the earnings of the entity.

         The  following  presentation  illustrates  basic  and  diluted  EPS  in
         accordance with the provisions of SFAS 128:

<TABLE>
<CAPTION>

                                                          Years Ended December 31,
                                                      -----------------------------
                                                           1997              1996
                                                      -----------       -----------
<S>                                                   <C>               <C>

Weighted average number of common shares
  outstanding used in basic EPS calculation ....          995,455         1,111,025
Reduction for common shares not yet
  released by Employee Stock Ownership Plan ....          (80,937)          (83,935)
                                                      -----------       -----------
Total weighted average common shares outstanding
  for basic computation ........................          914,518         1,027,090
Add common stock equivalents for shares issuable
  under Stock Option Plans .....................           13,206              --
                                                      -----------       -----------
Weighted average number of shares outstanding
  adjusted for common stock equivalents ........          927,724         1,027,090
                                                      ===========       ===========

Net income .....................................      $ 1,023,053           442,153
Basic earnings per share .......................      $      1.12               .43
Diluted earnings per share .....................      $      1.10               .43
</TABLE>
<PAGE>
1)       Summary of Significant Accounting Policies (continued)

         EPS for prior periods has been  restated to comply with the  provisions
         of SFAS 128. EPS  information  for the year ended  December 31, 1995 is
         not meaningful because the Company was not a public company until March
         29, 1996.

         Reclassification

         Certain 1995 and 1996 amounts  have been  reclassified  to conform with
         the 1997 presentation.

2)       Investment Securities, Available for Sale

         Investment  securities available for sale are recorded at fair value in
         accordance with SFAS 115. This portfolio is summarized as follows:
<TABLE>
<CAPTION>
                                                    Gross             Gross
                                   Amortized      Unrealized       Unrealized        Fair
                                     Cost           Gains            Losses         Value
                                  ----------      ----------      ----------      ----------
<S>                               <C>             <C>             <C>             <C>
December 31, 1997
United States Government
  securities ...............      $8,021,870          75,027           7,580       8,089,317
Marketable equity securities          22,371           1,926            --           124,297
                                  ----------      ----------      ----------      ----------

                                  $8,144,241          76,953           7,580       8,213,614
                                  ==========      ==========      ==========      ==========


December 31, 1996
United States Government
   securities ..............      $8,260,086          54,019          30,752       8,283,353
Marketable equity securities         632,085          23,499            --           655,584
                                  ----------      ----------      ----------      ----------

                                  $8,892,171          77,518          30,752       8,938,937
                                  ==========      ==========      ==========      ==========

</TABLE>
<PAGE>
2)       Investment Securities, Available for Sale (continued)

         The  contractual  maturity of the above  investments  is  summarized as
follows:
<TABLE>
<CAPTION>

                                      December 31, 1997               December 31, 1996
                                  --------------------------      -------------------------
                                  Amortized          Fair          Amortized         Fair
Term to Maturity                     Cost            Value            Cost           Value
                                  ----------      ----------      ----------      ----------
<S>                               <C>             <C>             <C>             <C>
Due in one year or less ....      $3,374,816       3,375,440         749,722         750,920
Due after one year through
   five years ..............       4,285,115       4,335,968       7,284,914       7,306,020
Due after five years through
   ten years ...............         361,939         377,909         225,450         226,413
Marketable equity securities         122,371         124,297         632,085         655,584
                                  ----------      ----------      ----------      ----------

                                  $8,144,241       8,213,614       8,892,171       8,938,937
                                  ==========      ==========      ==========      ==========
</TABLE>
         Proceeds from sales of investment  securities available for sale during
         the year ended  December 31, 1997 were  $4,014,689  with gross gains of
         $26,113 and gross losses of $3,849  realized on those  sales.  Proceeds
         from sales of investment  securities available for sale during the year
         ended  December  31,  1996 were  $132,617  with gross  gains of $52,617
         realized on those sales.  There were no sales of investment  securities
         available for sale during the year ended  December 31, 1995. The change
         in net unrealized  gains and losses during the current year of $22,607,
         net of the tax  effect  of  $9,042,  resulted  in a  $13,565  credit to
         stockholders' equity.

3)       Investment Securities Held for Trade

         Investment securities held for trade are accounted for at their current
         fair values.  Investment securities held for trade at December 31, 1997
         consists  of  equity  securities   (thrift  common  stock  mutual  fund
         investment  with a carrying value of $1,324,494 and common stock with a
         carrying value of $1,088,473). The investment securities held for trade
         at December 31, 1996  consists of common stock equity  securities.  The
         adjustment  of  these  securities  to their  current  fair  values  has
         resulted in a net  unrealized  gain of $577,681 as of December 31, 1997
         and a net unrealized gain of $46,484 as of December 31, 1996.  Proceeds
         from  sales of  investment  securities  held for trade  during the year
         ended  December 31, 1997 were  $680,940 with gross gains of $37,410 and
         gross losses of $1,344 realized on those sales.  There were no sales of
         investment securities held for trade during the year ended December 31,
         1996.
<PAGE>
4)       Mortgage-Backed Securities, Available for Sale

         Mortgage-backed  securities  available  for sale are  recorded  at fair
         value in  accordance  with SFAS 115.  This  portfolio is  summarized as
         follows:
<TABLE>
<CAPTION>
                                                                       Gross            Gross
                                                     Amortized       Unrealized      Unrealized         Fair
                                                        Cost           Gains           Losses           Value
<S>                                                  <C>             <C>             <C>             <C>
December 31, 1997
  Participation Certificates:
   FHLMC  - Fixed rate                               $2,745,886          40,333             630       2,785,589
   FNMA   - Adjustable rate                              68,573             362            --            68,935
   GNMA   - Adjustable rate                             630,513           8,998            --           639,511
                                                     ----------      ----------      ----------      ----------

                                                     $3,444,972          49,693             630       3,494,035
                                                     ==========      ==========      ==========      ==========

Weighted average interest rate                             6.88%


December 31, 1996
  Participation Certificates:
   FHLMC - Fixed rate ........                       $3,177,901            2,743           5,293       3,175,351
   FNMA  - Adjustable rate ...                           81,640              231            --            81,871
   GNMA  - Adjustable rate ...                          755,414            7,053             854         761,613
                                                     ----------      ----------      ----------      ----------

                                                     $4,014,955          10,027           6,147       4,018,835
                                                     ==========      ==========      ==========      ==========

         Weighted average interest rate                    6.87%
</TABLE>
         There were no sales of  mortgage-backed  securities  available for sale
         during the years ended December 31, 1997,  1996 and 1995. The change in
         net unrealized gains and losses during the current year of $45,183, net
         of  the  tax  effect  of  $18,073,  resulted  in a  $27,110  credit  to
         stockholders' equity.

<PAGE>
5)       Loans Receivable

         Loans receivable are summarized as follows:
<TABLE>
<CAPTION>
                                                               December 31,
                                                          1997              1996
                                                      -----------       -----------
<S>                                                   <C>               <C>
Mortgage loans:
  One-to-four family ...........................      $51,566,329        43,668,728
  Multi-family .................................        4,010,299         3,259,173
  Nonresidential ...............................        9,314,953         8,806,316
  Construction .................................        4,450,189         4,405,490
  Land .........................................          325,206           216,899
                                                      -----------       -----------

    Total mortgage loans .......................       69,666,976        60,356,606
                                                      -----------       -----------

Other loans:
  Loans on deposit accounts ....................          164,636           185,224
  Equity lines of credit .......................        3,258,776         2,968,265
  Other consumer ...............................        1,681,178         1,835,654
                                                      -----------       -----------

    Total other loans ..........................        5,104,590         4,989,143
                                                      -----------       -----------

Commercial business loans ......................        4,915,827         3,519,034
                                                      -----------       -----------

    Total loans receivable .....................       79,687,393        68,864,783
                                                      -----------       -----------

Less:
  Loans in process .............................        1,974,655           910,045
  Deferred loan fees, premiums and discounts-net          209,126           234,475
  Allowance for loan losses ....................          410,383           354,631
                                                      -----------       -----------

Loans receivable, net ..........................      $77,093,229        67,365,632
                                                      ===========       ===========


Weighted average interest rate .................             8.08%             8.10%
                                                      ===========       ===========
</TABLE>
<PAGE>
5)       Loans Receivable (continued)

         Activity in the allowance for loan losses is summarized as follows:
<TABLE>
<CAPTION>


                                                Years Ended December 31,
                                      -----------------------------------------
                                          1997            1996           1995
                                      ---------       ----------      ---------
<S>                                   <C>             <C>             <C>

Balance, beginning of year .....      $ 354,631         359,535         330,458
Provision for loan losses ......         74,243            --            39,384
Charge-offs ....................        (32,942)         (4,954)        (10,457)
Recoveries .....................         14,451              50             150
                                      ---------       ---------       ---------

Balance, end of year ...........      $ 410,383         354,631         359,535
                                      =========       =========       =========
</TABLE>

         Delinquent loans (loans having monthly payments past due ninety days or
         more and  non-accruing)  at  December  31,  1997 and 1996  amounted  to
         approximately $308,000 and $305,000 respectively.

         For the years ended December 31, 1997 and 1996,  gross interest  income
         which would have been recorded had the non-accruing  loans been current
         in  accordance  with their  original  terms  amounted to  approximately
         $12,000 and $23,000 respectively.

         Loans to directors  and  executive  officers  aggregated  approximately
         $201,000 and $220,000 at December 31, 1997 and 1996 respectively.  Such
         loans are made on substantially  the same terms as those for other loan
         customers.
<PAGE>
6)       Office Properties and Equipment

         Office properties and equipment are summarized as follows:
<TABLE>
<CAPTION>
                                              December 31,
                                      --------------------------
                                         1997             1996
                                      ----------      ----------
<S>                                   <C>             <C>
Cost:
        Land -      Munster           $   40,669          40,669
                    Hammond ....          33,300          33,300
                    East Chicago           5,000           5,000
        Building -  Munster ....         409,419         408,360
                    Hammond ....          43,030         241,890
                    East Chicago          40,447          36,637
Leasehold improvements - Dyer ..         148,096         148,096
Furniture and equipment ........         791,425         682,881
                                      ----------      ----------
                                       1,711,386       1,596,833

Less accumulated depreciation:
        Building -  Munster ....         375,366         366,494
                    Hammond ....         222,748         204,640
                    East Chicago          12,732           8,839
Leasehold improvements - Dyer ..          54,101          46,587
Furniture and equipment ........         574,709         459,670
                                      ----------      ----------
                                       1,239,656       1,086,230

Net book value .................      $  471,730         510,603
                                      ==========      ==========
</TABLE>
         Depreciation  of office  properties  and  equipment for the years ended
         December 31,  1997,  1996 and 1995  amounted to $153,426,  $139,808 and
         $132,848 respectively.

         The Bank has entered into a lease  agreement for its office location in
         Dyer,  Indiana.  The lease, which expires in 2000, carries an option to
         extend  for three  successive  renewals  of five  years  each.  Rent is
         payable  monthly and  adjusted  annually  based on the  consumer  price
         index.  Monthly rent at December 31, 1997 amounted to $3,086  including
         utilities.  The Bank is responsible for its proportionate share of real
         estate  taxes and  assessments  and for  maintaining  public  liability
         insurance  covering  the  premises.  Rent  expense  for the years ended
         December  31,  1997,  1996 and 1995  amounted to  $36,815,  $35,028 and
         $34,552 respectively.
<PAGE>
7)       Accrued Interest Receivable

         Accrued interest receivable is summarized as follows:
<TABLE>
<CAPTION>

                                                             December 31,
                                                    ---------------------------
                                                       1997              1996
                                                    ---------         ---------
<S>                                                 <C>               <C>

Investment securities ......................        $ 102,343           114,069
Mortgage-backed securities .................           19,928            23,297
Loans receivable ...........................          423,274           354,680
Allowance for uncollected interest .........          (12,036)          (39,091)
                                                    ---------         ---------

                                                    $ 533,509           452,955
                                                    =========         =========
</TABLE>
8)       Prepaid Expenses and Other Assets

         Prepaid expenses and other assets consist of the following:
<TABLE>
<CAPTION>
                                                                     December 31,
                                                                  1997            1996
                                                             ----------      ----------
<S>                                                          <C>             <C>

Prepaid insurance premiums ............................      $   45,430          54,783
Other prepaid expenses ................................          51,787          28,244
Cash surrender value of life insurance policies (a) ...         976,771         930,353
Deferred federal and state income tax benefit - net (b)            --           124,150
Miscellaneous .........................................          62,872          25,101
                                                             ----------      ----------

                                                             $1,136,860       1,162,631
                                                             ==========      ==========
</TABLE>
         (a)      The Board of Directors has approved a non-qualified retirement
                  income plan which will provide  pre-retirement death benefits,
                  post-retirement  death  benefits,  and retirement  benefits to
                  senior  management  and the Board of  Directors.  The Bank has
                  purchased life insurance  policies on all individuals  covered
                  under the plan. The Bank is the owner and  beneficiary of each
                  policy.
<PAGE>
8)       Prepaid Expenses and Other Assets (continued)

         (b)      The approximate tax effect of temporary  differences that give
                  rise to the  Company's  net deferred tax asset at December 31,
                  1996 under SFAS 109 is as follows:
<TABLE>
<CAPTION>


                                                       Assets        Liabilities          Net
                                                       ------        -----------          ---
<S>                                                   <C>              <C>             <C>
Loan fees deferred for
  financial reporting purposes .................      $  41,700            --            41,700
Accelerated book depreciation ..................          1,500            --             1,500
Deferred compensation ..........................         96,200            --            96,200
Nondeductible incentive plan expense ...........          7,710            --             7,710
Bad debt reserves established for
  financial reporting purposes .................        141,850            --           141,850
Increases to tax bad debt reserves
  since January 1, 1988 ........................           --          (125,950)       (125,950)
Unrealized gain on securities available for sale           --           (20,260)        (20,260)
Unrealized gain on trading account securities ..           --           (18,600)        (18,600)
                                                      ---------       ---------       ---------

                                                      $ 288,960        (164,810)        124,150
                                                      =========       =========       =========
</TABLE>
9)       Deposits

         Deposit accounts are summarized as follows:
<TABLE>
<CAPTION>
                                                            December 31,
                                                  ------------------------------
                                                      1997               1996
                                                  -----------        -----------
<S>                                               <C>                <C>

Passbook accounts ........................        $16,407,366         16,311,084
Demand deposits and NOW accounts .........          7,257,897          6,712,053
Money market accounts ....................          2,877,385          2,454,249
                                                  -----------        -----------

                                                   26,542,648         25,477,386
Certificates of deposit:
  Jumbo ..................................          7,190,175          5,696,748
  7-91 days ..............................          1,166,480          1,115,737
  6-11 months ............................         16,653,468          7,100,476
  12-29 months ...........................         11,657,512         11,153,781
  30 months and over .....................          6,848,888          8,142,683
  IRA and Keogh ..........................          1,640,955          1,724,186
                                                  -----------        -----------

                                                  $71,700,126         60,410,997
                                                  ===========        ===========
</TABLE>
<PAGE>
9)       Deposits (continued)

         The weighted  average rate on deposit accounts at December 31, 1997 and
         1996 was 4.65% and 4.38% respectively.

         A summary of certificates of deposit by maturity is as follows:
<TABLE>
<CAPTION>
                                                         December 31,
                                               ---------------------------------
                                                   1997                  1996
                                               -----------           -----------
<S>                                            <C>                   <C>
Within 12 months ...................           $36,441,807            25,692,560
12 months to 24 months .............             6,685,024             6,657,443
24 months to 36 months .............             1,625,298             2,025,883
36 months to 48 months .............               235,807               541,980
Over 48 months .....................               169,542                15,745
                                               -----------           -----------

Total ..............................           $45,157,478            34,933,611
                                               ===========           ===========
</TABLE>

         Interest expense on deposits consists of the following:
<TABLE>
<CAPTION>

                                              Years Ended December 31,
                                    --------------------------------------------
                                        1997             1996             1995
                                    ----------       ---------         ---------
<S>                                 <C>              <C>              <C>

Passbook accounts ...........       $  488,273          509,836          543,561
NOW accounts ................          143,687          137,192          143,032
Money market accounts .......           89,355           88,853          101,801
Certificates of deposit .....        2,378,102        2,024,893        1,799,197
                                    ----------       ----------       ----------

Total .......................       $3,099,417        2,760,774        2,587,591
                                    ==========       ==========       ==========
</TABLE>


         The aggregate  amount of deposit accounts with a balance of $100,000 or
         greater was  approximately  $10,500,000  and $7,200,000 at December 31,
         1997 and 1996,  respectively.  Deposits in excess of  $100,000  are not
         insured by the Federal Deposit Insurance Corporation.
<PAGE>
10)      Borrowed Money

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


                                               Interest            December 31,
         Maturity Date                          Rate         1997                1996
         --------------                         ----     -----------         ----------
<S>                                              <C>     <C>                 <C>

         June 5, 1997                            6.50    $    -               1,000,000
         October 20, 1997                        5.79         -               1,500,000
         November 3, 1998                        5.87      3,000,000          3,000,000
         December 7, 1998                        5.80      3,000,000          3,000,000
         December 6, 1999                        5.94      1,000,000          1,000,000
         May 17, 2000                            5.85      3,000,000              -
         July 25, 2000                           6.11      2,000,000            -
                                                          ----------          ---------

                                                         $12,000,000          9,500,000
                                                          ==========          =========


         Weighted average interest rate                          5.89%              5.91%
                                                                 ====               ====
</TABLE>

         The Bank is required to maintain qualifying  collateral for the Federal
         Home Loan Bank of Indianapolis  representing  approximately 170 percent
         of  current  Bank  credit.  At  December  31,  1997,  the Bank met this
         requirement.  Assets which are eligible collateral for meeting the 170%
         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.

         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 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, 1997, the balance of this loan amounted to $719,440.

<PAGE>
11)      Other Liabilities

         Other liabilities include the following:
<TABLE>
<CAPTION>
                                                                     December 31,
                                                                  1997          1996
                                                               --------      --------
<S>                                                            <C>           <C>

Accrued interest on deposits ............................      $ 61,374        76,018
Accrued interest on borrowings ..........................        31,431        24,950
Accrued bonus ...........................................          --          25,000
Accrued audit and accounting fees .......................        19,200        16,775
Accrued real estate and personal property taxes .........        52,500        52,500
Accrued federal and state income tax ....................       255,853        48,489
Accrued pension .........................................        10,852        27,500
Deferred federal and state income tax liability - net (a)        25,938          --
Deferred compensation (see note 12) .....................       319,839       240,519
Miscellaneous accounts payable ..........................       165,147       197,242
                                                               --------      --------

                                                               $942,134       708,993
                                                               ========      ========
</TABLE>
         (a)      The approximate tax effect of temporary  differences that give
                  rise to the  Company's  net deferred tax liability at December
                  31, 1997 under SFAS 109 is as follows:
<TABLE>
<CAPTION>
                                                        Assets       Liabilities          Net
                                                      ---------       ---------       ---------
<S>                                                   <C>             <C>            <C>

Loan fees deferred for
  financial reporting purposes .................      $  45,475            --            45,475
Accelerated book depreciation ..................         16,900            --            16,900
Deferred compensation ..........................        127,935            --           127,935
Nondeductible incentive plan expense ...........          7,720            --             7,720
Bad debt reserves established
  for financial reporting purposes .............        164,155            --           164,155
Increases to tax bad debt reserves
  since January 1, 1988 ........................           --          (114,490)       (114,490)
Unrealized gain on securities available for sale           --           (47,375)        (47,375)
Unrealized gain on trading account securities ..           --          (231,073)       (231,073)
Other ..........................................          4,815            --             4,815
                                                      ---------       ---------       ---------

                                                      $ 367,000        (392,938)        (25,938)
                                                      =========       =========       =========
</TABLE>

12)      Benefit Plans

         The Bank participates in a  non-contributory  qualified defined benefit
         pension plan which covers all full-time  employees  having a minimum of
         twelve months of service, and who are at least twenty-one years of age.
         The present  funding policy is to make the minimum annual  contribution
         as required by applicable regulations.
<PAGE>
12)      Benefit Plans (continued)

         The  following  table sets forth the plan's  funded  status and amounts
         recognized in the Bank's consolidated  financial statements at December
         31.
<TABLE>
<CAPTION>
                                                                  1997             1996
                                                             -----------       -----------
<S>                                                          <C>               <C>
Projected benefit obligation (actuarial present value
   of projected benefits attributed to employee service
   to date based on future compensation levels) .......      $   913,624           895,838
Plan assets at fair value .............................        1,000,646           804,260
                                                             -----------       -----------
Plan assets (less than) in excess of  projected
   benefit obligation .................................           87,022           (91,578)
Unrecognized prior service cost .......................           84,337            89,023
Unrecognized net (gain) loss ..........................         (273,295)         (121,723)
Unrecognized net transition obligation ................           91,084            96,778
                                                             -----------       -----------

Net pension liability included in accrued expenses ....      $   (10,852)          (27,500)
                                                             ===========       ===========
</TABLE>

         Included in the  projected  benefit  obligation is an amount called the
         accumulated  benefit  obligation.  The accumulated  benefit  obligation
         represents  the  actuarial  present  value of  benefits  attributed  to
         employee service and compensation levels to date. At December 31, 1997,
         the accumulated benefit obligation was $751,900. The vested portion was
         $749,604.

         Net pension  expense for the years ended  December 31,  1997,  1996 and
         1995 is being accounted for per SFAS No. 87, "Employers' Accounting for
         Pensions" and includes the following components:
<TABLE>
<CAPTION>
                                              Years Ended December 31,
                                      ------------------------------------------
                                         1997            1996              1995
                                      ---------       ---------       ----------
<S>                                   <C>             <C>             <C>

Service cost ...................      $  30,648          42,713          37,924
Interest cost ..................         66,579          63,953          45,828
Actual return on assets ........       (142,938)        (87,097)       (121,520)
Net amortization and deferral ..         98,758          33,052          78,492
                                      ---------       ---------       ---------

Net pension expense ............      $  53,047          52,621          40,724
                                      =========       =========       =========
</TABLE>
         The discount rate used in  determining  the actuarial  present value of
         the  projected  benefit  obligation  at the  beginning  of the  year to
         determine the net periodic  pension cost and at the end of the year for
         the present  value of the benefit  obligation  during 1997 and 1996 was
         7.5% and during 1995 was 6.0%. The expected long-term rate of return on
         assets was 9.0% during 1997 and 1996 and 7.0% during 1995, and the rate
         of increase in future compensation was 3.5% in 1997, 1996, and 1995.
<PAGE>
12)      Benefit Plans (continued)

         The Bank has  established a  non-qualified  401(k) Plan for officers of
         the Bank. The Plan provides  participating  officers the opportunity to
         defer up to 6% of their  salary  over the next  five  years  into a tax
         deferred accumulation for future retirement.  The Bank will match up to
         50% (3% of salary) of this deferral. In addition,  the Bank established
         a Director  Deferral Plan which provides  participating  directors with
         the  opportunity  to defer all or a portion of their fees over the next
         five years.  Deferred  amounts are credited with interest from the Bank
         at the rate of 10% per year.

         Contributions  by the Bank to the 401(k)  Plan,  including  interest on
         accumulated funds was $36,282,  $29,178 and $22,253 for the years ended
         December 31, 1997, 1996 and 1995 respectively.

13)      Director, Officer and Employee Plans

         Stock Option Plan. On October 23, 1996, 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 112,412, equal to 10.0% of the total number of shares issued in
         the Conversion. As of October 23, 1996, 100,042 options were granted at
         $12.75  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, 1997 and the stock
         options outstanding at the end of the respective periods.
<TABLE>
<CAPTION>
                                                             Exercise Price
                                             Number       ----------------------
         Options                          of Options      Per Share      Total
         -------                          ----------      ---------      -----
<S>                                       <C>             <C>         <C>
Outstanding at December 31, 1995 ...               0
Granted ............................         100,042      $   12.75   $1,275,535
Exercised ..........................               0
Forfeited ..........................               0

Outstanding at December 31, 1996 ...         100,042          12.75    1,275,535
Granted ............................               0
Exercised ..........................               0
Forfeited ..........................               0

Outstanding at December 31, 1997 ...         100,042      $   12.75   $1,275,535
                                          ==========      =========   ==========

Exercisable at December 31, 1997 ...          20,008      $   12.75   $  255,102
                                          ==========      =========   ==========

Options available for future
  grants at December 1997 ..........          12,370
                                          ==========
</TABLE>
<PAGE>
13)      Director, Officer and Employee Plans (continued)

         The Company has elected to follow  Accounting  Principles Board Opinion
         No. 25 "Accounting  for Stock Issued to Employees" (APB 25) and related
         Interpretations in accounting for its employee stock options. Under APB
         25, because the exercise price of the Company's  employee stock options
         equals the market price of the  underlying  stock on the date of grant,
         no compensation expense is recognized.

         The  Company  implemented  SFAS No.  123  "Accounting  for  Stock-Based
         Compensation"   during  1996.  The  Company  will  retain  its  current
         accounting  method  for  its  stock-based   compensation   plans.  This
         statement will only result 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 for the years ended December 31, 1997 and 1996:
<TABLE>
<CAPTION>


                                                     Years Ended December 31,
                                                  ---------------------------
                                                      1997              1996
<S>                                               <C>                 <C>
Net income (as reported) ....................     $ 1,023,053         442,153
Pro forma net income ........................         956,839         431,117
Diluted earnings per share (as reported) ....            1.10             .43
Pro forma diluted earnings per share ........            1.03             .42
</TABLE>


         The pro forma results  presented above may not be representative of the
         effects reported in pro forma net income for future years.

         The fair value of the option  grants for the years ended  December  31,
         1997 and 1996 was  estimated  on the  date of  grant  using  the  Black
         Scholes option value model,  with the following  assumptions:  dividend
         yield of  approximately  2.00%,  expected  volatility of 20%, risk free
         interest rate of 6.10% and an expected life of approximately 10 years.

         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  89,930  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  $139,741  and $132,084 for the years ended  December
         31, 1997 and 1996.
<PAGE>
13)      Director, Officer and Employee Plans (continued)

         On November 22, 1993, the AICPA issued  Statement of Position No. 93-6,
         "Employers'  Accounting  for  Employee  Stock  Ownership  Plans"  ("SOP
         93-6").  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.  SOP  93-6  is
         effective  for fiscal years  beginning  after  December  31, 1992.  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, 1997 and 1996,  additional  compensation  expense of
         $42,322 and $10,880 was  recognized  as a result of  implementation  of
         this accounting principle.

         Recognition and Retention  Plan. On October 23, 1996, the  stockholders
         of the Company  approved the AMB Financial Corp.  1996  Recognition and
         Retention  Plan ("RRP").  This plan was  established to award shares to
         directors  and to  employees  in key  management  positions in order to
         provide  them with a  proprietary  interest  in the Company in a manner
         designed to encourage  such  employees to remain with the Company.  The
         number of shares authorized under the Plan is 44,965,  equal to 4.0% of
         the total number of shares issued in the Conversion.  These shares were
         purchased in the open market during the quarter ended December 31, 1996
         at a total cost of $578,929. As of October 23, 1996, 43,616 shares were
         awarded and will vest at a rate of 20% per year commencing  October 23,
         1997, while 1,349 shares were reserved for future awards.

         The $578,929  contributed to the RRP is being amortized to compensation
         expense as the plan participants become vested in those shares. For the
         years ended December 31, 1997 and 1996,  $115,786 and $19,297 have been
         amortized to expense.  The  unamortized  cost,  which is  comparable to
         deferred  compensation,  is reflected  as a reduction of  stockholders'
         equity.

14)      Income Taxes

         The Company has adopted  SFAS No. 109 which  requires a change from the
         deferred method to the liability method of accounting for income taxes.
         Under the liability  method,  deferred  income taxes are recognized for
         the tax consequences of "temporary  differences" by applying  statutory
         tax  rates  applicable  to  future  years to  differences  between  the
         financial  statement  carrying amounts and tax bases of existing assets
         and liabilities.

         Among the  provisions of SFAS 109 which will impact the Bank is the tax
         treatment of bad debt  reserves.  SFAS 109 provides that a deferred tax
         asset is to be  recognized  for the bad debt  reserve  established  for
         financial  reporting  purposes and requires a deferred tax liability to
<PAGE>
14)      Income Taxes (continued)

         be recorded for increase in the tax bad debt reserve  since  January 1,
         1988, to effective  date of certain  changes made by the Tax Reform Act
         of 1986 to the calculation of savings institutions' bad debt deduction.
         Accordingly,   retained   earnings  at  December   31,  1997   includes
         approximately  $1,950,000  for which no  deferred  federal  income  tax
         liability has been recognized.

         The provision for income taxes consists of the following:
<TABLE>
<CAPTION>
                                             Years Ended December 31,
                                    -------------------------------------------
                                      1997              1996              1995
                                      ----              ----              ----
<S>                                 <C>              <C>               <C>
Current ...................         $551,901          249,696           249,650
Deferred (benefit) ........          122,973          (35,410)          (13,950)
                                    --------         --------          --------

                                    $674,874          214,286           235,700
                                    ========         ========          ========
</TABLE>
         A reconciliation  of the statutory federal income tax rate to effective
income tax rate is as follows:
<TABLE>
<CAPTION>
                                                     Years Ended December 31,
                                                  ------------------------------
                                                  1997         1996         1995
                                                  ----         ----         ----
<S>                                               <C>          <C>          <C>
Statutory federal income tax rate .......         34.0%        34.0%        34.0%
State income taxes ......................          5.9          5.0          5.8
Other ...................................          (.2)        (6.4)        (1.9)
                                                  ----         ----         ----

Effective income tax rate ...............         39.7%        32.6%        37.9%
                                                  ====         ====         ====
</TABLE>
         Deferred  income tax expense  (benefit)  consists of the  following tax
effects of timing differences:
<TABLE>
<CAPTION>
                                                            Years Ended December 31,
                                                   -----------------------------------------
                                                       1997            1996           1995
                                                   ---------       ---------       ---------
<S>                                                <C>             <C>             <C>
Loan fees ...................................      $  (3,775)         29,500          12,200
Depreciation ................................        (15,400)         (7,900)         (2,300)
Deferred compensation .......................        (31,745)        (28,400)        (25,300)
Book loan loss provision (in excess of)
  less than tax deduction ...................        (33,765)          1,500           6,400
Unrealized gain on trading account securities        212,473          18,600            --
Other, net ..................................         (4,815)        (48,710)         (4,950)
                                                   ---------       ---------       ---------

                                                   $ 122,973         (35,410)        (13,950)
                                                   =========       =========       =========
</TABLE>
<PAGE>
15)      Regulatory Capital Requirements

         Capital  regulations  require  the  Bank to have a  minimum  regulatory
         tangible  capital  ratio  equal to 1.5% of  total  adjusted  assets,  a
         minimum 3.0% core capital ratio and an 8.0%  risk-based  capital ratio.
         For  purposes  of the  regulation,  the core and  tangible  capital  of
         American Savings, FSB is defined as stockholders' equity,  adjusted for
         unrealized  gains and losses on  securities  available  for sale (other
         than unrealized losses in equity  securities),  net of taxes.  Adjusted
         total assets are the Bank's total assets as determined  under generally
         accepted  accounting  principles,  adjusted  for  unrealized  gains and
         losses on securities available for sale, net of taxes.

         In determining compliance with the risk-based capital requirement,  the
         Bank is  allowed to use both core  capital  and  supplementary  capital
         provided the amount of  supplementary  capital used does not exceed the
         Bank's core capital.  Supplementary capital of American Savings, FSB is
         defined  to include  all of the  Bank's  general  loss  allowances.  In
         addition, certain exclusions from capital and assets are required to be
         made for the purpose of calculating  total capital,  in addition to the
         adjustments  required for  calculating  core capital.  Such  exclusions
         consist of equity investments as defined by regulation.  The risk-based
         capital  requirement  is measured  against  risk-weighted  assets which
         equals the sum of each asset and the  credit-equivalent  amount of each
         off-balance  sheet item after  being  multiplied  by an  assigned  risk
         weight.

         At December 31, 1997 and 1996, the Bank's regulatory equity capital was
         as follows:
<TABLE>
<CAPTION>
                                         Tangible              Core           Risk-based
                                          Capital             Capital           Capital
                                        -----------        -----------        -----------
<S>                                     <C>                <C>                <C>
December 31, 1997

Stockholders' equity .............      $ 9,563,406          9,563,406          9,563,406
Unrealized gain on securities
  available for sale, net of taxes          (71,061)           (71,061)           (71,061)
General loss allowances ..........             --                 --              410,383
Direct equity investments ........             --                 --              (15,000)
                                        -----------        -----------        -----------

Regulatory capital computed ......        9,492,345          9,492,345          9,887,728
Minimum capital requirement ......        1,459,000          2,919,000          4,274,000
                                        -----------        -----------        -----------

   Regulatory capital excess .....      $ 8,033,345          6,573,345          5,613,728
                                        ===========        ===========        ===========

Computed capital ratio ...........             9.76%              9.76%             18.51%
Minimum capital ratio ............             1.50               3.00               8.00
                                        -----------        -----------        -----------

   Regulatory capital excess .....             8.26%              6.76%             10.51%
                                        ===========        ===========        ===========
</TABLE>
<PAGE>
15)      Regulatory Capital Requirements (continued)

         A  reconciliation  of the Bank's equity capital at December 31, 1997 is
as follows:
<TABLE>
<CAPTION>

<S>                                                                <C>
Stockholders' equity .......................................       $ 14,770,283
Less Company stockholders' equity not available
  for regulatory capital ...................................         (5,206,877)

Stockholders' equity of the Bank ...........................       $  9,563,406
                                                                   ============
<CAPTION>

                                         Tangible               Core             Risk-based
                                          Capital              Capital             Capital
                                       ------------        ------------        ------------
<S>                                    <C>                 <C>                 <C>
December 31, 1996

Stockholders' equity ............      $ 11,192,355          11,192,355          11,192,355
Unrealized gain on securities
 available for sale, net of taxes           (30,386)            (30,386)            (30,386)
General loss allowances .........              --                  --               354,631
Direct equity investments .......              --                  --               (15,000)
                                       ------------        ------------        ------------

Regulatory capital computed .....        11,161,969          11,161,969          11,501,600
Minimum capital requirement .....         1,280,000           2,561,000           3,701,000
                                       ------------        ------------        ------------

   Regulatory capital excess ....      $  9,881,969           8,600,969           7,800,600
                                       ============        ============        ============

Computed capital ratio ..........             13.08%              13.08%              24.86%
Minimum capital ratio ...........              1.50                3.00                8.00
                                       ------------        ------------        ------------

   Regulatory capital excess ....             11.58%              10.08%              16.86%
                                       ============        ============        ============

</TABLE>

         A  reconciliation  of the Bank's equity capital at December 31, 1996 is
         as follows:
<TABLE>
<CAPTION>

<S>                                                                <C>
Stockholders' equity .......................................       $ 15,169,857
Less Company stockholders' equity not available
  for regulatory capital ...................................         (3,977,502)

Stockholders' equity of the Bank ...........................       $ 11,192,355
                                                                   ============
</TABLE>
<PAGE>
16)      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.

17)      SAIF Special Assessment and its Impact on SAIF Insurance Premiums

         The deposits of American  Savings,  FSB, are  presently  insured by the
         Savings  Association  Insurance Fund ("SAIF"),  which together with the
         Bank Insurance Fund ("BIF"),  are the two insurance funds  administered
         by  the  Federal  Deposit  Insurance  Corporation  ("FDIC").  Financial
         institutions   which  are   members   of  the  BIF  were   experiencing
         substantially  lower  deposit  insurance  premiums  because the BIF had
         achieved  its  required  level of  reserves  while the SAIF had not yet
         achieved  its  required  reserves.  In  order  to help  eliminate  this
         disparity and any  competitive  disadvantage  due to disparate  deposit
         insurance premium  schedules,  legislation to recapitalize the SAIF was
         enacted in September 1996.

         The legislation  required a special  one-time  assessment of 65.7 cents
         per $100 of SAIF insured  deposits  held by the Bank at March 31, 1995.
         The  one-time  special  assessment  resulted in a charge to earnings of
         approximately  $390,000  during the year ended  December 31, 1996.  The
         after-tax effect of this one-time charge to earnings totaled  $234,000.
         The  legislation  was intended to fully  recapitalize  the SAIF fund so
         that commercial bank and thrift deposits would be charged the same FDIC
         premiums  beginning January 1, 1997. As of such date, deposit insurance
         premiums for highly  rated  institutions,  such as the Bank,  have been
         substantially reduced.

         The Bank, however, will continue to be subject to an assessment to fund
         repayment of the Financing Corporation's ("FICO") obligations. The FICO
         assessment for SAIF insured institutions will be 6.48 cents per $100 of
         deposits while BIF insured institutions will pay 1.52 cents per $100 of
         deposits until the year 2000 when the assessment will be imposed at the
         same rate on all FDIC insured institutions.
<PAGE>
18)      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 $95,000 at December 31, 1997
         represent  amounts  which  the Bank  plans to fund  within  the  normal
         commitment  period of 60 to 90 days. The $95,000  commitment is a fixed
         rate  commitment  at  7.05%.  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  $2,350,000  at December 31,  1997.  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  $1,300,000 at December 31, 1997.
         The Bank also has  approved  but unused  credit card lines of credit of
         approximately $650,000.

19)      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.

20)      Subsequent Event

         On January 29, 1998, the Company  declared a quarterly cash dividend of
         $.07  per  share,  totaling  $67,466,  payable  February  26,  1998  to
         shareholders of record as of February 12, 1998.

21)      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.
<PAGE>
21)      Disclosures About the Fair Value of Financial Instruments (continued)

         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.

         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.

21)      Disclosures About the Fair Value of Financial Instruments (continued)

         The estimated fair value of the Company's  financial  instruments as of
         December 31, 1997 and 1996 are as follows:
<TABLE>
<CAPTION>
                                                             December 31, 1997
                                                      ----------------------------
                                                        Carrying            Fair
                                                         Amount            Value
                                                         ------            -----
<S>                                                   <C>               <C>
Financial assets:
  Cash and cash equivalents ....................      $ 5,686,955        5,686,955
  Investment securities, available for sale ....        8,213,614        8,213,614
  Investment securities held for trade .........        2,412,967        2,412,967
  Mortgage-backed securities, available for sale        3,494,035        3,494,035
  Loans receivable .............................       77,093,229       78,919,000

Financial liabilities:
  Deposits .....................................      $71,700,126       71,838,000
  Borrowed money ...............................       12,000,000       11,920,560
</TABLE>
<PAGE>
21)      Disclosures About the Fair Value of Financial Instruments (continued)

<TABLE>
<CAPTION>
                                                           December 31, 1996
                                                      ----------------------------
                                                        Carrying           Fair
                                                         Amount            Value
                                                         ------            -----
<S>                                                   <C>               <C>
Financial assets:
  Cash and cash equivalents ..........................$ 2,567,367        2,567,367
  Investment securities, available for sale ..........  8,938,937        8,938,937
  Investment securities held for trade ...............    539,500          539,500
  Mortgage-backed securities, available for sale .....  4,018,835        4,018,835
  Loans receivable ................................... 67,365,632       66,956,000

Financial liabilities:
  Deposits ...........................................$60,410,997       60,514,400
  Borrowed money .....................................  9,500,000        9,390,630
</TABLE>


22)      Condensed Parent Company Only Financial Statements

         The  following  condensed  statement  of  financial  condition,  as  of
         December 31, 1997 and 1996 and condensed  statements of income and cash
         flows for the year ended  December  31,  1997 and the period from March
         29, 1996 to December 31, 1996 for AMB Financial Corp. should be read in
         conjunction  with the consolidated  financial  statements and the notes
         thereto.
<PAGE>
22)      Condensed Parent Company Only Financial Statements (continued)
<TABLE>
<CAPTION>
                        Statement of Financial Condition

                                                           December 31,
                                               --------------------------------
                                                    1997                1996
                                               ------------        ------------
<S>                                            <C>                 <C>
Assets

Cash and cash equivalents ..............       $    287,378             551,371
Investment securities held for trade ...          2,412,967             539,500
Loans receivable .......................          2,726,824           2,930,177
Equity investment in the Bank ..........         10,144,323          11,960,459
Prepaid expenses and other assets ......              1,458                --
                                               ------------        ------------

                                                 15,572,950          15,981,507

Liabilities and Stockholders' Equity

Liabilities:
Accrued taxes and other liabilities ....            221,750              43,546
                                               ------------        ------------

Stockholders' Equity:
Common stock ...........................             11,241              11,241
Additional paid-in capital .............         10,649,606          10,646,866
Retained earnings ......................          7,357,250           6,564,204
Treasury stock .........................         (2,223,051)           (724,718)
Common stock awarded by RRP ............           (443,846)           (559,632)
                                               ------------        ------------

  Total stockholders' equity ...........         15,351,200          15,937,961
                                               ------------        ------------

                                               $ 15,572,950          15,981,507
                                               ============        ============

</TABLE>
<PAGE>
22)      Condensed Parent Company Only Financial Statements (continued)

<TABLE>
<CAPTION>
                               Statement of Income

                                                                          Period from
                                                         Year Ended      March 29, 1996
                                                         December 31,   to December 31,
                                                             1997              1996
                                                         ------------       -----------

<S>                                                       <C>               <C>
Interest income ....................................      $   198,035           207,053
Gain on sale of investment securities held for trade           36,066              --
Unrealized gain on securities held for trade .......          531,197            46,484
Non-interest expense ...............................         (208,294)         (159,960)
                                                          -----------       -----------

Net income before income taxes
  and equity in earnings of subsidiaries ...........          557,004            93,577
Provision for income taxes .........................         (217,815)          (40,048)
                                                          -----------       -----------

Net income before equity in earnings of subsidiaries          339,189            53,529
Equity in earnings of subsidiaries .................          683,864           302,801
                                                          -----------       -----------

  Net income .......................................      $ 1,023,053           356,330
                                                          ===========       ===========
</TABLE>
<PAGE>
22)      Condensed Parent Company Only Financial Statements (continued)
<TABLE>
<CAPTION>
                             Statement of Cash Flows


                                                                               Period from
                                                              Year Ended      March 29, 1996
                                                             December 31,   to December 31,
                                                                 1997              1996
                                                             -----------       ------------
<S>                                                          <C>               <C>
Operating activities:
  Net income ..........................................      $ 1,023,053           356,330
  Equity in earnings of the Bank ......................         (683,864)         (302,801)
  Amortization of cost of stock benefit plan ..........          115,786            19,297
  Gain on sale of investment securities  held for trade          (36,066)             --
  Unrealized gain on securities held for trade ........         (531,197)          (46,484)
  Purchase of trading account securities ..............       (1,987,144)         (493,016)
  Proceeds from sale of trading account securities ....          680,940              --
  Increase in other assets ............................           (1,458)             --
  Increase in accrued taxes and other liabilities .....          180,944            43,546
                                                             -----------       -----------

Net cash provided for operating activities ............       (1,239,006)         (423,128)
                                                             -----------       -----------

Investing activities:
  Purchase of capital stock of the Bank ...............             --          (5,329,053)
  Loan disbursements ..................................       (2,000,000)       (3,733,530)
  Loan repayments .....................................        2,203,353           803,353
                                                             -----------       -----------

Net cash provided by (for) investing activities .......          203,353        (8,259,230)
                                                             -----------       -----------

Financing activities:
  Net proceeds from sale of common stock ..............             --          10,658,107
  Purchase of treasury stock ..........................       (1,498,333)         (724,718)
  Purchase of RRP stock ...............................             --            (578,929)
  Dividends received from Bank ........................        2,500,000
  Dividends paid on common stock ......................         (230,007)         (120,731)
                                                             -----------       -----------

Net cash provided by investing activities .............          771,660         9,233,729
                                                             -----------       -----------

Net increase (decrease) in cash and cash equivalents ..         (263,993)          551,371
Cash and cash equivalents at beginning of period ......          551,371              --
                                                             -----------       -----------

Cash and cash equivalents at end of period ............      $   287,378           551,371
                                                             ===========       ===========
</TABLE>
<PAGE>
                               AMB Financial Corp.
                             Stockholder Information

Annual Meeting

The annual  meeting of  stockholders  will be held at 10:30  a.m.,  on April 22,
1998, at the Company's corporate office, located at 8230 Hohman Avenue, Munster,
Indiana.

Stock Listing

The Company' s stock is trading 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 bid prices and dividends paid in
fiscal  1997.  These  prices do not  represent  actual  transactions  and do not
include retail markups, markdowns or commissions.

             Quarter Ended             High            Low        Dividends
             -------------             ----            ---        ---------
             March 31, 1997           14-3/8         13-9/32        $0.06
             June 30, 1997            15             14-3/8         $0.06
             September 30, 1997       15-3/4         14-1/2         $0.06
             December 31, 1997        17-3/4         15-3/8         $0.07


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 16 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, 1997, the Company had 203  stockholders of record and 963,798
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
<PAGE>
                       AMB Financial Corp.
                       Corporate Information
Corporate Office

AMB Financial Corp.               Telephone (219-836-5870
8230 Hohman Avenue                Fax (219) 836-5870
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.

Robert E. Tolley
Director since 1987.


Independent Auditors                         Corporate Counsel / Local
Cobitz, VandenBerg & Fennessy                Abrahamson, Reed & Adley.
9944 S. Roberts Road Suite 202               Attorneys at Law
Palos Hills, IL 60465                        200 Russell Street
                                             Hammond, IN 46320

                                             Corporate Counsel / Washington DC
                                             Silver, Freedman & Taff, L.L.P.
                                             1100 New York Ave., N.W.
                                             Washington, DC 20005-3934
<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:

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