SECURITIES AND EXCHANGE COMMISSION
                              Washington, D.C.

                                FORM 10-QSB

               [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
                   OF THE SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended June 30, 2000

                                     OR

               [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d)
                   OF THE SECURITIES EXCHANGE ACT

             For the transition period from           to
                                            ---------    ---------

                         Commission File No. 0-28934


                          Empire Federal Bancorp, Inc.
            ------------------------------------------------------
            (Exact name of registrant as specified in its charter)


              Delaware                              81-0512374
   -----------------------------------------------------------------
   (State or other jurisdiction of               (I.R.S. Employer
    incorporation or organization)              Identification No.)


               123 South Main Street, Livingston, Montana  59047
               -------------------------------------------------
                    (Address of principal executive offices)


                                (406) 222-1981
              ----------------------------------------------------
              (Registrant's telephone number, including area code)

Check whether the issuer (1) filed all reports required to be filed by
Sections 13 or 15(d) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
YES  X     NO
    ---       ---

State the number of shares outstanding of each of the issuer's classes of
common equity as of the latest practicable date.

       Class:   Common Stock, par value $.01 per share
                Outstanding at July 31, 2000: 1,748,643
Transitional Small Business Disclosure Format (check one):  YES       NO  X
                                                                 ---     ---

<PAGE>

                       EMPIRE FEDERAL BANCORP, INC.

                          INDEX TO FORM 10-QSB

                                                                       Page
                                                                       ----
PART I    FINANCIAL INFORMATION
          ---------------------

Item 1.   Condensed Financial Statements

            Consolidated Balance Sheets at June 30, 2000
            (unaudited) and December 31, 1999 (unaudited)............    1

            Consolidated Statements of Income for the Three Months
            and Six Months Ended June 30, 2000 and 1999 (unaudited)..    2

            Consolidated Statements of Cash Flows for the Six Months
            Ended June 30, 2000 and 1999 (unaudited).................    3

            Notes to Unaudited Interim Consolidated Financial
            Statements...............................................    4

Item 2.   Management's Discussion and Analysis of Financial Condition
          and Results of Operations..................................    9


PART II   OTHER INFORMATION
          -----------------

Item 1.   Legal Proceedings..........................................   15

Item 2.   Changes in Securities......................................   15

Item 3.   Defaults upon Senior Securities............................   15

Item 4.   Submission of Matters to a Vote of Security Holders........   15

Item 5.   Other Information..........................................   15

Item 6.   Exhibits and Reports on Form 8-K...........................   15


SIGNATURES...........................................................   16

<PAGE>

Part I, Item 1 - Financial Statements
-------------------------------------

              EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES
                       Consolidated Balance Sheets
                   June 30, 2000 and December 31, 1999
                               (unaudited)

                                                   June 30,      December 31,
                    Assets                            2000          1999
                    ------                     -------------    -------------

Cash and due from banks                        $   2,622,712    $   1,688,206
Interest-bearing deposits                            252,486          683,913
                                               -------------    -------------
   Cash and cash equivalents                       2,875,198        2,372,119
Investment and mortgage-backed securities
 available-for-sale                               31,573,229       41,090,151
Investment and mortgage-backed securities
 held-to-maturity (estimated market value of
 $5,833,447 at June 30, 2000 and $6,367,598
 at December 31, 1999)                             5,658,431        6,406,467
Loans receivable, net                             70,250,877       59,569,783
Stock in Federal Home Loan Bank of Seattle,
 at cost                                           1,487,300        1,463,500
Accrued interest receivable                          437,885          451,386
Premises and equipment, net                        3,879,314        2,860,330
Prepaid expenses and other assets                    374,036          313,032
                                               -------------    -------------
       Total assets                            $ 116,536,270    $ 114,526,768
                                               =============    =============
     Liabilities and Stockholders' Equity
     ------------------------------------
Liabilities:
   Demand deposits                             $     942,803    $     864,132
   NOW accounts                                    9,884,218       10,512,251
   Money market                                    8,976,678        6,825,711
   Regular savings                                12,233,656       13,915,404
   Certificates of deposit                        41,922,162       39,235,600
                                               -------------    -------------
       Total Deposits                             73,959,517       71,353,098
   Advances from Federal Home Loan Bank
    and other Borrowed funds                      10,638,815        8,800,000
   Note payable                                      562,042          591,847
   Advances from borrowers for taxes and
    insurance                                        291,016          229,437
   Accrued expenses and other liabilities            645,462          797,169
                                               -------------    -------------
       Total liabilities                          86,096,852       81,771,551

Stockholders' equity:
   Preferred stock, par value $.01 per share,
    250,000 shares authorized, none issued
    and outstanding                                       --               --
   Common stock, par value $.01 per share,
    4,000,000 shares authorized, 2,592,100
    issued                                            25,921           25,921
   Additional paid-in capital                     25,264,969       25,260,408
   Unearned ESOP and MRDP compensation            (2,096,358)      (2,264,623)
   MRDP shares acquired                             (302,011)        (302,011)
   Retained earnings, substantially restricted    18,102,520       17,842,091
   Accumulated other comprehensive income, net       341,110          632,893
   Treasury shares acquired, at cost, 797,857
    and 590,830 shares at June 30, 2000 and
    December 31, 1999 respectively               (10,896,733)      (8,439,462)
                                               -------------    -------------
       Total stockholders' equity                 30,439,418       32,755,217
                                               -------------    -------------
       Total liabilities and stockholders'
        equity                                 $ 116,536,270    $ 114,526,768
                                               =============    =============

See accompanying notes to unaudited interim consolidated financial statements.

                                       1
<PAGE>

               EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

                     Consolidated Statements of Income
             Three and Six Months Ended June 30, 2000 and 1999
                               (unaudited)

                                Three Months Ended        Six Months Ended
                                       June 30                 June 30
                              -----------------------  ----------------------
                                    2000         1999        2000        1999
                                   -----         ----        ----        ----
Interest income:
    Loans receivable          $1,413,431   $1,098,626  $2,701,990  $2,092,927
    Mortgage-backed
     securities                  604,105      691,007   1,303,844   1,412,951
    Investment securities         36,720       39,577      83,569      77,160
    Other                         35,126       56,804      71,105     123,074
                              ----------   ----------  ----------  ----------
Total interest income          2,089,382    1,886,014   4,160,508   3,706,112
                              ----------   ----------  ----------  ----------
Interest expense:
    Deposits                     800,155      705,876   1,578,166   1,388,831
    Note payable and other       159,753       64,702     312,685     129,894
                              ----------   ----------  ----------  ----------
Total interest expense           959,908      770,578   1,890,851   1,518,725
                              ----------   ----------  ----------  ----------
    Net interest income        1,129,474    1,115,436   2,269,657   2,187,387

Provision for loan losses         15,000           --      30,000          --
                              ----------   ----------  ----------  ----------
    Net interest income
     after provision for
     loan losses               1,114,474    1,115,436   2,239,657   2,187,387

Non-interest income:
    Insurance commission
     income                      129,720      129,499     252,447     289,639
    Customer service charges     135,442       69,332     225,499     142,823
    Gain on sale of
     investments, net            100,857           --     150,171          --
    Other                          8,997        7,528      17,855      16,587
                              ----------   ----------  ----------  ----------
      Total non-interest
       income                    375,016      206,359     645,972     449,049

Non-interest expense:
    Compensation and benefits    553,695      456,055   1,084,405     895,800
    Occupancy and equipment      115,166      117,100     227,196     205,560
    Deposit insurance premiums    11,550        9,625      23,100      34,881
    Other                        309,562      211,413     504,646     431,985
                              ----------   ----------  ----------  ----------
Total non-interest expense       989,973      794,193   1,839,347   1,568,226
                              ----------   ----------  ----------  ----------
      Income before income
       taxes                     499,517      527,602   1,046,282   1,068,210

Income taxes                     193,605      204,534     405,605     417,799
                              ----------   ----------  ----------  ----------
      Net income              $  305,912   $  323,068  $  640,677  $  650,411
                              ==========   ==========  ==========  ==========

Basic earnings per share      $     0.19   $     0.19  $     0.39  $     0.36
                              ==========   ==========  ==========  ==========
Diluted earnings per share    $     0.19   $     0.19  $     0.39  $     0.36
                              ==========   ==========  ==========  ==========
Dividends declared per share  $     0.11   $     0.10  $     0.21  $     0.20
                              ==========   ==========  ==========  ==========

See accompanying notes to unaudited interim consolidated financial statements.

                                       2
<PAGE>

               EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

                   Consolidated Statements of Cash Flows

                 Six Months Ended June 30, 2000 and 1999
                              (unaudited)

                                                      Six Months Ended
                                                          June 30,
                                                      2000          1999
                                               -------------    -------------
Cash flows from operating activities:
     Net income                                $     640,677    $     650,411
     Adjustments to reconcile net income
      to net cash provided by operating
      activities:
          Provision for loan losses                   30,000                -
          Depreciation                               115,185          114,045
          ESOP shares committed to be released        77,552           85,596
          MRDP shares vested                          95,274           90,505
          Gain on sale of investments and
           mortgage-backed securities afs           (150,171)               -
          Stock dividends reinvested in
           Federal Home Loan Bank                    (23,800)         (51,000)
          Decrease (increase) in accrued
           interest receivable                        13,501          (75,815)
          Increase (decrease) in prepaid
           expenses and other assets                 (61,004)          50,810
          Increase (decrease) in accrued
           expenses and other liabilities             34,843          (51,936)
               Net cash provided by            -------------    -------------
                operating activities                 772,057          812,616
                                               -------------    -------------
Cash flows from investing activities:
     Net change in loans receivable              (10,711,094)      (3,144,287)
     Proceeds from sale of mortgage-backed
      securities available for sale                4,407,853                -
     Principal payments on mortgage-backed
      securities held-to maturity                    748,036        2,255,634
     Proceeds from sale of securities
      available-for-sale                           2,167,738                -
     Principal payments on mortgage-backed
      securities available-for-sale                2,613,169        6,002,307
     Purchases of mortgage-backed securities
      available-for-sale                                   -       (6,578,497)
     Purchases of premises and equipment          (1,134,169)        (133,532)
                                               -------------    -------------
               Net cash used in investing
                activities                        (1,908,467)      (1,598,375)
                                               -------------    -------------
Cash flows from financing activities:
     Net change in deposits                        2,606,419        3,163,633
     Repayment of note payable                       (29,805)         (27,410)
     Net change in advances from borrowers
      for taxes and insurance                         61,579           51,319
     Dividends paid                                 (380,248)        (386,363)
     Proceeds from advances from FHLB              1,838,815                -
     Purchase of treasury stock                   (2,457,271)      (3,128,643)
                                               -------------    -------------
          Net provided by (used in)
           financing activities                    1,639,489         (327,464)
                                               -------------    -------------
Net increase (decrease) in cash and cash
 equivalents                                         503,079       (1,113,223)

Cash and cash equivalents, beginning of period     2,372,119        5,153,797
                                               -------------    -------------
Cash and cash equivalents, end of period       $   2,875,198    $   4,040,574
                                               =============    =============
Cash paid during the period for:
       Interest                                $     951,753    $     741,044
       Income taxes                                  425,000          398,000
                                               =============    =============

See accompanying notes to unaudited interim consolidated financial statements.

                                       3
<PAGE>



                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

        Notes to unaudited Interim Consolidated Financial Statements
                              June 30, 2000

Note 1  Basis of Presentation
        ---------------------

        The accompanying unaudited interim consolidated financial statements
have been prepared in accordance with generally accepted accounting principles
for interim financial information.  Accordingly, they do not include all of
the information and footnotes required by generally accepted accounting
principles for audited financial statements.  They should be read in
conjunction with the audited consolidated financial statements filed as part
of the Annual Report on Form 10-KSB for the year ended December 31, 1999.

        The accompanying consolidated financial statements include the
accounts of Empire Federal Bancorp, Inc. (the Holding Company) and its
wholly-owned subsidiary, Empire Bank (Empire or the Bank) and Dime Service
Corporation (Dime), a wholly-owned subsidiary of Empire.  The Holding Company,
Empire and Dime are herein referred to collectively as "the Company."  All
significant intercompany balances and transactions have been eliminated in
consolidation.

        In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for fair presentations have been
included.  The results of operations for the three and six months ended June
30, 2000, and 1999 are not necessarily indicative of the results which may be
expected for an entire year or any other period.

Note 2  Comprehensive Income
        --------------------

        The Company's only component of comprehensive income is the net
unrealized gains or losses on securities available-for-sale.  The following
summarizes total comprehensive income (loss) for the noted periods:

               Six Months Ended                    Three Months Ended
       June 30, 2000     June 30, 1999    June 30, 2000       June 30, 1999
       -------------     -------------    -------------       -------------

          $348,894        $(107,538)         $265,723           $(157,705)
          ========        =========          ========           =========

Note 3  Treasury Stock
        --------------

        During the six months ended June 30, 2000 the Board of Directors
approved a program to repurchase up to 20% of its outstanding common stock
during the year.  During the six months ended June 30, 2000, the Company
purchased 207,027 shares in the open market for $2,457,000 for an average
price of $11.87 per share.  At June 30, 2000 the Company had repurchased
797,857 shares for a total of $10,897,000 or an average price of $13.66.  Book
value per share at June 30, 2000 was $16.97.

                                       4
<PAGE>

                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

Note 4  Earnings Per Share
        ------------------

        Basic earnings per share (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.  Additionally, ESOP shares
which are unallocated and not yet committed to be released (unallocated) and
unvested MRDP shares issued are excluded from the weighted-average common
shares outstanding calculation.  At June 30, 2000, there were 35,537 allocated
shares and 6,912 committed to be released ESOP shares.  There were 52,797
vested MRDP shares.

        Diluted EPS reflects the potential dilution that could occur if
securities or other contracts to issue common stock were exercised or resulted
in the issuance of common stock that would share in the earnings of the
entity.  At June 30, 2000, outstanding stock options and unvested MRDP shares
were anti-dilutive to EPS.  Dilutive potential common shares are added to the
weighted-average shares used to compute basic EPS.  The following information
provides a reconciliation of the numerators and denominators of the basic and
fully diluted EPS computation:

<TABLE>

                                                    For the six months ended June 30
                        ---------------------------------------------------------------------------------
                                            2000                                        1999
                        --------------------------------------       ------------------------------------
                        Net Income      Shares       Per-Share       Net Income     Shares      Per-Share
                        (Numerator)   (Denominator)    Amount        (Numerator)  (Denominator)   Amount
                        -----------   -------------    ------        -----------  -------------   ------
<S>                      <C>            <C>            <C>           <C>          <C>             <C>
Basic EPS

 Net income available to
  common stockholders    $640,677       1,653,888      $0.39          $650,411     1,820,742      $0.36
                         ========                      =====          ========                    =====
Effect of Dilutive
 Securities
  Stock Options -
   granted                                     --                                         --

  Unvested MRDP shares                         --                                         --
                                        ---------                                  ---------
Diluted EPS

  Income available to
   common stockholders
   plus assumed
   conversion            $640,677       1,653,888      $0.39          $650,411     1,820,742     $0.36
                         ========       =========      =====          ========     =========     =====


                                                   For the three months ended June 30
                        ---------------------------------------------------------------------------------
                                            2000                                        1999
                        --------------------------------------       ------------------------------------
                        Net Income      Shares       Per-Share       Net Income     Shares      Per-Share
                        (Numerator)   (Denominator)    Amount        (Numerator)  (Denominator)   Amount
                        -----------   -------------    ------        -----------  -------------   ------
<S>                      <C>            <C>            <C>           <C>          <C>             <C>
Basic EPS

 Net income available to
  common stockholders    $305,912       1,587,136      $0.19          $323,068     1,696,218      $0.19
                         ========                      =====          ========                    =====
Effect of Dilutive
 Securities
 Stock Options -
  granted                                      --                                         --

 Unvested MRDP shares                          --                                         --
                                        ---------                                  ---------
Diluted EPS

 Income available to
  common stockholders
  plus assumed
  conversion             $305,912       1,587,136      $0.19          $323,068     1,696,218     $0.19
                         ========       =========      =====          ========     =========     =====

                                                        5
</TABLE>
<PAGE>

                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

Note 5   Cash Dividend Declared
         ----------------------

          On July 25, 2000, the Board of Directors declared a quarterly cash
dividend of $.11 per common share to stockholders of record on August 11, 2000
payable on August 25, 2000.


Note 6   Capital Compliance
         ------------------

         The following table presents Empire's compliance with its regulatory
capital requirements of June 30, 2000 (dollars in thousands):

                                                              Percentage
                                                    Amount    of Assets
                                                    ------    ---------

            GAAP capital(1)                     $   28,046      24.07%
                                                ==========    =======

            Tangible capital                    $   27,277      23.63%
            Tangible capital requirement             1,732       1.50%
                                                ----------    -------

               Excess                           $   25,545      22.13%
                                                ==========    =======

            Core capital                        $   27,277      23.63%
            Core capital requirement                 3,463       3.00%
                                                ----------    -------

               Excess                           $   23,814      20.63%
                                                ==========    =======

            Total risk-based capital(2)         $   28,239      46.41%
            Total risk-based capital
              requirement(2)                         4,868       8.00%
                                                ----------    -------

               Excess                           $   23,371      38.41%
                                                ==========    =======

                (1)  Empire's GAAP capital includes unrealized gains on
                     certain available-for-sale securities of $341,000 and
                     $428,000 of investments in Dime, which are excluded for
                     purposes of calculating both tangible and core capital.
                (2)  Based on risk-weighted assets of $60,849,000.


Note 7  Operating Segment Information
        -----------------------------

        As of December 31, 1998, the Company adopted SFAS No. 131, "Financial
Reporting for Segments of a Business Enterprise."  This statement requires
that a public business enterprise report financial and descriptive information
about its reportable operating segments.  According to the statement,
operating segments are defined as components of an enterprise about which
separate financial information is available that is evaluated regularly by the
chief operating decision maker in deciding how to allocate resources and in
assessing performance.

        The Company evaluates segment performance internally based on its two
primary lines of business, commercial banking and insurance, and thus the
operating segments are so defined.  The operating segment defined as "other"
includes the Holding Company and eliminations of transactions between
segments.

        The accounting policies of the individual operating segments are the
same as those of the Company.  Transactions between operating segments are
primarily conducted at fair value, resulting in profits that are eliminated
for reporting consolidated results of operations.

                                       6
<PAGE>


                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

The following is a summary of selected operating segment information at or for
the six months ended June 30, 2000 and 1999.

2000:                  Empire           Dime        Other       Consolidated
                       ------           ----        -----       ------------
Net interest
 income            $  2,146,177         7,239       116,241       2,269,657
Non-interest income     419,286       264,814       (38,128)        645,972
                   ------------     ---------     ---------     -----------
   Total income       2,565,463       272,053        78,113       2,915,629

Provision for
 loan losses             30,000            --            --          30,000
Other non-interest
 expense              1,338,947       281,610       218,790       1,839,347
                   ------------     ---------     ---------     -----------
   Income before
    income taxes      1,196,516        (9,557)     (140,677)      1,046,282
Income Taxes            460,125             --      (54,520)        405,605
                   ------------     ---------     ---------     -----------
    Net Income     $    736,391        (9,557)      (86,157)        640,677
                   ============     =========     =========     ===========

Assets             $116,594,829       533,189     (591,748)     116,536,270
Net loans            70,250,877            --           --       70,250,877
Deposits             74,292,638            --     (333,121)      73,959,517
Stockholders'
 equity              28,046,215       428,302    1,964,901       30,439,418
                   ============     =========     =========     ===========
1999:
Net interest
 income            $  2,028,105         4,423       154,859       2,187,387
Non-interest income     218,083       294,619       (63,653)        449,049
                   ------------     ---------     ---------     -----------
   Total income       2,246,188       299,042        91,206       2,636,436

Provision for loan
 losses                      --            --            --              --
Other non-interest
 expense              1,092,311       283,487       192,428       1,568,226
                   ------------     ---------     ---------     -----------

   Income before
    income taxes      1,153,877        15,555      (101,222)      1,068,210
Income taxes            442,000         2,899       (27,100)        417,799
                   ------------     ---------     ---------     -----------

   Net income      $    711,877        12,656       (74,122)        650,411
                   ============     =========     =========     ===========
Assets             $108,348,050       543,245      (485,549)    108,405,746
Net loans            52,643,443            --            --      52,643,443
Deposits             69,921,121            --      (344,891)     69,576,230
Stockholders'
 equity              29,903,976       429,505     2,521,199      32,854,680
                   ============     =========     =========     ===========

                                       7
<PAGE>

                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

The following is a summary of selected operating segment information for the
three months ended June 30, 2000 and 1999.

2000:                  Empire           Dime        Other       Consolidated
                       ------           ----        -----       ------------
Net interest
 income            $  1,068,872         3,709        56,893       1,129,474
Non-interest
 income                 261,584       135,941       (22,509)        375,016
                   ------------     ---------     ---------     -----------
   Total income       1,330,456       139,650        34,384       1,504,490

Provision for loan
 losses                  15,000            --            --          15,000
Other non-interest
 expense                719,272       141,173       129,528         989,973
                   ------------     ---------     ---------     -----------
   Income before
    income taxes        596,184        (1,523)      (95,144)        499,517
Income Taxes            229,325            --       (35,720)        193,605
                   ------------     ---------     ---------     -----------
   Net Income      $    366,859        (1,523)      (59,424)        305,912
                   ============     =========     =========     ===========

1999:
Net interest
 income            $  1,050,752         2,235        62,449       1,115,436
Non-interest income      82,600       130,241        (6,482)        206,359
                   ------------     ---------     ---------     -----------
   Total income       1,133,352       132,476        55,967       1,321,795

Provision for loan
 losses                      --            --            --              --
Other non-interest
 expense                551,076       147,757        95,360         794,193
                   ------------     ---------     ---------     -----------
   Income before
    income taxes        582,276       (15,281)      (39,393)        527,602
Income taxes            221,500         3,234       (20,200)        204,534
                   ------------     ---------     ---------     -----------
   Net income      $    360,776       (18,515)      (19,193)        323,068
                   ============     =========     =========     ===========

                                       8
<PAGE>

                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

Part I, Item 2. -  Management's Discussion and Analysis of Financial Condition
------------------------------------------------------------------------------
                   and Results of Operations
                   -------------------------

General

Management's discussion and analysis of financial condition and results of
operations is intended to assist in understanding the financial condition and
results of operations of the Company.

Operating Strategy

The Bank is a community oriented financial institution which has traditionally
offered a variety of savings products to its retail customers while
concentrating its lending activities on the origination of loans secured by
one-to-four family residential dwellings.  The Bank considers Gallatin, Park
and Sweet Grass counties in south-central Montana as its primary market area.
During 1999, the Bank received regulatory approval to open a de novo branch in
Billings, Montana, and management opened the new branch in April 2000.  In
addition, the Bank will be opening a loan production office in Missoula,
Montana during the third quarter of 2000.  Lending activities also have
included the origination of multi-family, commercial, business, commercial
real estate and home equity loans.  The Bank's primary business has been that
of a traditional financial institution, originating loans in its primary
market area for its portfolio.  In addition, the Bank has maintained a
significant portion of its assets in investment and mortgage-backed
securities.  Similar to its lending activities, the Bank's investment
portfolio has been weighted toward U.S. Government agency mortgage-backed
securities secured by one-to-four family residential properties.  The
portfolio also includes U. S. Government agency securities.  The Bank plans to
continue to fund its assets primarily with deposits, although FHLB advances
will be used as a supplemental source of funds.

The Bank's profitability depends primarily on its net interest income, which
is the difference between the income it receives on its loan and investment
portfolio and its cost of funds, which consists of interest paid on deposits
and FHLB advances.  Net interest income is also affected by the relative
amounts of interest-earning assets and interest-bearing liabilities.  When
interest-earning assets equal or exceed interest-bearing liabilities, any
positive interest rate spread will generate net interest income.  The Bank's
profitability is also affected by the level of other income and expenses.
Other income consists of service charges on checking and  NOW accounts and
other fees, insurance commissions and net gains or losses on the sale of
investments.  Other expenses include compensation and employee benefits,
occupancy expenses, deposit insurance premiums, equipment and data servicing
expenses, professional fees and other operating costs.  The Bank's results of
operations are also significantly affected by general economic and competitive
conditions, particularly changes in market interest rates, government
legislation and policies concerning monetary and fiscal affairs, housing and
financial institutions and the attendant actions of the regulatory
authorities.

The Bank's strategy is to operate as a conservative, well-capitalized,
profitable institution dedicated to offering a full line of community banking
services and to  providing quality service to all customers.  The Bank
believes that it has successfully implemented its strategy by (i) maintaining
strong capital levels, (ii) maintaining effective control over operating
expenses to attempt to achieve profitability under differing interest rate
scenarios, (iii) emphasizing local loan originations, and (iv) emphasizing
high-quality customer service with a competitive fee structure.

As evidenced by the new branch in Billings and an increase in commercial and
business loans, the Bank's strategy is changing from its historical role as a
mortgage lender to a growth-oriented expansion strategy by pursuing internal
and external growth opportunities, when appropriate.  This new strategy may
subject the Company to a greater degree of risk.  Risks associated with this
new business strategy include increased risk of

                                       9
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                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

losses on loans, provision to loan losses which exceed historical levels,
difficulties in integrating or managing new branches or acquired institutions
and problems related to the management of growth.  There can be no assurance
that the Company will be successful in implementing this new business strategy
or in managing growth.

Year 2000 Issues
The Bank places significant reliance on computers to process information
necessary to conduct its business.  During the past few years industry and
regulatory agencies advised the business community that some computers may not
be able to interpret certain information related to the year 2000.  The Bank
successfully completed the year-end closings and all computer systems were
totally operable following January 1, 2000, and management did not identify
any errors or experience any computer malfunctions.  The major financial
impact related to the Year 2000 issue was the replacement of teller hardware
and software.  The cost of conversion and retraining amounted to $225,000. The
Bank has not been informed of any such problem experienced by its vendors or
its customers.

While there were no disruptions of any services provided to our customers,
management will continue to monitor all data processing applications into the
Year 2000.  Management does not believe at this time that any potential
problems will materially impact the ability of the Bank to continue its
operation, however, no assurance can be given that this will be the case.

Financial Condition
Consolidated assets increased by approximately $2.0 million, or 1.75%, from
$114.5 million at December 31, 1999 to $116.5 million at June 30, 2000.

Investments and mortgage-backed securities available-for-sale decreased $9.5
million, or 23.2% from $41.1 million at December 31, 1999 to $31.6 million at
June 30, 2000 as the result of sales amounting to $6.4 million and maturities
and payments of $2.6 million and a decline in market value of $478,000.  Net
loans increased $10.7 million, or 17.9%, from $59.6 million at December 31,
1999 to $70.3 million at June 30, 2000.

Deposits increased from $71.4 million at December 31, 1999 to $74.0 million at
June 30, 2000.

Premises and equipment increased by $1.0 million, or 35.6% from $2.9 million
at December 31, 1999 to $3.9 million June 30, 2000 primarily as the result of
the remodeling costs associated with the property in Billings, Montana for the
new branch facility.

Stockholders' equity decreased from $32.8 million at December 31, 1999, to
$30.4 million at June 30, 2000.  The change is the result of net income of
$641,000, the release of ESOP shares in the amount of $78,000 and a decrease
of $292,000 related to the market value of securities available-for-sale.  In
addition, 5,962 shares of MRDP vested and unearned MRDP compensation was
reduced by $95,000.  Stockholders' equity was also decreased by the payments
of $380,000 in dividends.  During the six months ended June 30, 2000, the
Company repurchased 207,027 shares of its common stock in the open market for
an average price of $11.87 per share for a total of $2.5 million.  There were
797,857 shares held in treasury at June 30, 2000, and 590,830 shares at
December 31, 1999.

Asset Quality
At June 30, 2000, the Bank had no nonaccrual loans.  At June 30, 2000, the
Bank had eight loans delinquent over 30 days amounting to $407,000 of which
one loan amounting to $9,000 was delinquent over 90 days.  The Bank had no
real estate acquired through foreclosure.

                                       10
<PAGE>

                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

Results of Operations
The operating results of the Bank depend primarily on its net interest income.
The Bank's net interest income is determined by its interest rate spread,
which is the difference between the yields earned on its interest-earning
assets and the rates paid on its interest-bearing liabilities and the degree
of mismatch in the maturity and repricing characteristics of its interest-
earning assets and interest-bearing liabilities.  The Bank's net earnings are
also affected by the establishment of provisions for loan losses and the level
of its other non-interest income, including insurance commission income and
deposit service charges, as well as its other expenses and income tax
provisions.

Comparison of Results of Operations for the Six Months Ended June 30, 2000 and
1999

Net Income.  Net income decreased by $10,000 to $641,000 for the six months
ended June 30, 2000 as compared to the same period in 1999.  While the net
income is approximately the same for the two comparative periods, several
components of net income changed and are discussed in the following narrative.

Net Interest Income.  Net interest income increased $82,000, or 3.8%, from
$2.1 million for the six months ended June 30, 1999 to $2.2 million for the
same period in 2000.  The interest rate spread increased from 2.88% for the
six months ended June 30, 1999 to 2.96% for the comparable period in 2000.

Interest Income.  Total interest income increased by $454,000, or 12.3% from
$3.7 million for the six months ended June 30, 1999 to $4.2 million for the
same period in 2000.  The increase was primarily attributable to an increase
in average interest earning assets of $5.8 million, or 5.6% from $104.1
million for the six months ended June 30, 1999 as compared to the comparable
period in 2000.  Average outstanding loans increased $14.5 million offset by
decreases in the average outstanding balances of investments and mortgage-
backed securities of $8.7 million. The yield on interest earning assets for
the six months ended June 30, 2000, was 7.6% as compared to 7.1% for the
comparable period in 1999.

Interest Expense.  Total interest expense was $1.9 million for the six months
ended June 30, 2000, as compared to $1.5 million for the same period in 1999.
Interest on deposits increased by $189,000, or 13.6%, and interest on notes
payable and other debt increased by $183,000, or 140.7%.

Average deposits for the six months ended June 30, 2000 amounted to $71.5
million as compared to $67.4 million for the same period in 1999.  In addition
to the increase in average deposits, the cost of deposits increased from 4.1%
for the six months ended June 30, 1999 to 4.4% for the same period in 2000
reflecting a general increase in interest rates in the Bank's markets.

Other interest expense of $313,000 for the six months ended June 30, 2000
includes $286,000 related to borrowings from the FHLB and $27,000 associated
with the purchase of the main office building.  Other interest expense for the
comparable period in 1999 included $101,000 related to FHLB borrowings and
$29,000 associated with the purchase of the main office building.

Provision for Loan Losses.  The provision for loan losses was $30,000 for six
months ended June 30, 2000 as compared to no provision for the same period in
1999.  At the end of both periods, the level of reserves was deemed to be
adequate by management.  Loan loss reserves as a percentage of loans were .36%
at June 30, 2000, and .42% at June 30, 1999. Management's periodic evaluation
of the adequacy of the allowance is based on factors such as the Bank's past
loan loss experience, known and inherent risks in the portfolio, adverse
situations that may affect the borrower's ability to repay, estimated value of
any underlying collateral, current and prospective economic conditions, peer
group comparisons, and independent appraisals.  In addition, various
regulatory agencies, as an integral part of their examination process,
periodically review the Bank's allowance for loan losses.  Such agencies may
require the Bank to provide additions to the allowance based upon judgments
different from management.  Assessment of the adequacy of the allowance for
credit losses involves subjective judgments regarding future events, and thus,
there can be no assurance that additional provisions for credit losses will
not be required in future periods. Although management uses the best

                                       11
<PAGE>

                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

information available, future adjustments to the allowance may be necessary
due to economic, operating, regulatory and other conditions that may be beyond
the Bank's control.  Any increase or decrease in the provision for loan losses
has a corresponding negative or positive effect on net income.

Non-Interest Income.  Non-interest income increased $197,000 for the six
months ended June 30, 2000, as compared to the same period in 1999 primarily
as the result of a $83,000 increase in customer service charges and other
non-interest income, net gain on the sale of investments of $150,000, offset
by a decrease in commissions from insurance companies of $37,000.

The net gain on sale of investments was the result of the sale of $6.4 million
of mortgage-backed securities and bonds for a loss of $160,000 offset by the
sale of 6,800 shares of FHLMC stock for a gain of $310,000.  Most of the
proceeds of these sales were used to fund the repurchase of treasury shares
during the six months ended June 30, 2000.

Insurance commissions received from Dime are the largest component of
non-interest income.  Insurance commissions of $252,000 and $290,000 were
received for the six months ended June 30, 2000 and 1999, respectively.  The
decrease in commission income resulted primarily from decreases in premiums
and commissions from key companies represented by Dime.  Increased competition
and possible future decreases in commissions will continue to impact Dime's
financial results.

Non-Interest Expense.  Total non-interest expense increased $271,000 or 17.3%
for the six months ended June 30, 2000, compared to the same period in 1999.
Included in this increase is a $189,000  increase in compensation expense
which is primarily related to the additional salaries and benefits for the
employees at the new branch in Billings.  Occupancy expense also increased
from $206,000 for the six months ended June 30, 1999 to $227,000 primarily as
the result of additional cost associated with the new branch facility.

Additional increases in other non-interest expense amounting to $73,000 were
the result of increased legal, consulting and auditing costs.

Income Taxes.  Income taxes were approximately the same for the six months
ended June 30, 2000 and 1999.   The effective combined federal and state tax
rate was 38.77% and 39.11% for the six months ended June 30, 2000 and 1999,
respectively.

                                       12
<PAGE>



                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

Comparison of Results of Operations for the Three Months Ended June 30, 2000
and 1999

Net Income.  Net income decreased by $17,000 to $306,000 for the three months
ended June 30, 2000 as compared to $323,000 for the same period in 1999.
While the net income is approximately the same for the two comparative
periods, several components of net income changed and are discussed in the
following narrative.

Net Interest Income.  Net interest income increased $14,000, or 1.3%, from the
three months ended June 30, 1999 compared to the same period in 2000.  The
interest rate spread increased from 2.82% for the three months ended June 30,
1999 to 3.02% for the comparable period in 2000.

Interest Income.  Total interest income increased by $203,000, or 10.8% from
$1.9 million for the three months ended June 30, 1999 to $2.1 million for the
same period in 2000.  The increase was primarily attributable to an increase
in average interest earning assets of $4.2 million, or 4.1% from $104.2
million for the three months ended June 30, 1999 as compared to the comparable
period in 2000.  Average outstanding loans increased $17.5 million offset by
decreases in the average outstanding balances of investments and mortgage-
backed securities of $13.3 million. The yield on interest earning assets for
the three months ended June 30, 2000, was 7.7% as compared to 7.0% for the
comparable period in 1999.

Interest Expense.  Total interest expense was $960,000 for the three months
ended June 30, 2000, as compared to $771,000 for the same period in 1999.
Interest on deposits increased by $94,000, or 13.4%, and interest on notes
payable and other debt increased by $95,000, or 146.9%.

Average deposits for the three months ended June 30, 2000 amounted to $71.8
million as compared to $66.9 million for the same period in 1999.  In addition
to the increase in average deposits, the cost of deposits increased from 4.1%
for the three months ended June 30, 1999 to 4.5% for the same period in 2000
reflecting a general increase in interest rates in the Bank's markets.

Other interest expense of $160,000 for the three months ended June 30, 2000
includes $147,000 related to borrowings from the FHLB and $13,000 associated
with the purchase of the main office building.  Other interest expense for the
comparable period in 1999 included $51,000 related to FHLB borrowing and
$14,000 associated with the purchase of the main office building.

Provision for Loan Losses.  The provision for loan losses was $15,000 for
three months ended June 30, 2000 as compared to no provision for the same
period in 1999.  At the end of both periods, the level of reserves was deemed
to be adequate by management.  Loan loss reserves as a percentage of loans was
 .36% at June 30, 2000, and .42% at June 30, 1999.

Non-Interest Income.  Non-interest income increased $169,000 for the three
months ended June 30, 2000, as compared to the same period in 1999 primarily
as the result of a $66,000 increase in customer service charges and other
non-interest income, net gain on the sale of investments of $101,000 for the
three month period ended June 30, 2000.  Commissions from insurance companies
was $130,000 for both three month periods ended June 30, 2000 and 1999.
Insurance commissions received from Dime are the largest component of
non-interest income.  Increased competition and possible future decreases in
commissions will continue to impact Dime's financial results.

The net gain on sale of investments was the result of the sale of $3.1 million
of mortgage-backed securities and bonds for a loss of $80,000 offset by the
sale of 4,000 shares of FHLMC stock for a gain of $181,000.

Non-Interest Expense.  Total non-interest expense increased $196,000 or 24.7%
for the three months ended June 30, 2000, compared to the same period in 1999.
Included in this increase is a $97,000  increase in compensation expense which
is primarily related to the additional salaries and benefits for the employees
at the new branch in Billings.

                                       13
<PAGE>



                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

Other non-interest expense increased 46.4% from $211,000 for the three month
period ended June 30, 1999 to $310,000 for the comparable period in 2000.  The
increases are primarily related to costs associated with opening of the new
branch in Billings, and increases in consulting, legal and auditing costs.

Income Taxes.  Income taxes were approximately the same the three months ended
June 30, 2000 and 1999.   The effective combined federal and state tax rate
was 38.76% and 38.77% for the three months ended June 30, 2000 and 1999,
respectively.

                                       14
<PAGE>


                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

Part II - Other Information
---------------------------

Item 1. Legal Proceedings
          There are no pending material legal proceedings to which the
          registrant or its subsidiaries are a party.

Item 2. Changes in Securities
          None.

Item 3. Defaults on Senior Securities
          Not applicable.

Item 4. Submission of Matters to a Vote of Securities Holders
          None.

Item 5. Other Information
          None.

Item 6. Exhibits and Reports on Form 8-K
        (a)   Exhibits

     3.1   Certificate of Incorporation of Empire Federal Bancorp, Inc. (1)

     3.2   Bylaws of Empire Federal Bancorp, Inc. (1)

    10.1   Employment Agreement with Kenneth P. Cochran (5)

    10.2   Employment Agreement with William H. Ruegamer (4)

    10.3   Employee Stock Ownership Plan (1)

    10.4   Management Recognition and Development Plan (3)

    10.5   Stock Option Plan (3)

    10.6   Financial Institution's Thrift Plan 401(k)(4)

    21     Subsidiaries of the Registrant (4)

    27     Financial Data Schedule

-----------------------
(1)  Incorporated by reference to the Company's Registration Statement on Form
     SB-1, as amended (File No. 333-12653).

(2)  Incorporated by reference to the Company's Annual Report on Form 10-KSB
     for the year ended December 31, 997.

(3)  Incorporated by reference to the Company's Annual Meeting Proxy Statement
     dated March 16, 1998.

(4)  Incorporated by reference to the Company's Annual Report on Form 10-KSB
     for the year ended December 31, 1999.

(5)  Incorporated by reference to the Company's Quarterly Report on Form
     10-QSB for the three months ended March 31, 2000.

        (b) Report on Form 8-K       A Form 8-K was filed on April 11, 2000.

                                       15
<PAGE>

                   EMPIRE FEDERAL BANCORP, INC. AND SUBSIDIARIES

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


Empire Federal Bancorp, Inc.



By   s/s William H. Ruegamer                  August 11, 2000
     ------------------------------------   ------------------
     William H. Ruegamer                          Date
     President & Chief Executive Officer
     (Principal Executive Officer)




By   s/s Linda M. Alkire                      August 11, 2000
     ------------------------------------   ------------------
     Linda M. Alkire                              Date
     Treasurer & Chief Financial Officer

                                       16
<PAGE>