FORM 10-QSB

                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                     ---------------------------------------



(Mark one)

(X) Quarterly report pursuant to Section 13 or 15(d) of the Securities  Exchange
Act of 1934.

For the quarterly period ended December 31, 1996, or

( )  Transition report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934.

For the transition period from                 to

                        Commission file number: 0-20742

                                CB BANCORP, INC

         Delaware                                              35-1866127
--------------------------------                            ----------------
  (State or other jurisdiction                              (I.R.S. Employee
of incorporation or organization)                            Identification
                                                                 Number)
126 E Fourth Street
-------------------
Michigan City, Indiana          46360
----------------------        ----------
(Address of principal         (Zip code)
executive office)

Registrant's telephone number, including area code: (219) 873-2800
                                                    --------------

Check  whether  the issuer  (1) has filed all  reports  required  to be filed by
section 13 or 15(d) of the Securities  Exchange Act of 1934 during the preceding
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.
                         (1) Yes  X  .    No     .
                                -----       -----

                         (2) Yes  X  .    No     .
                                -----       -----

APPLICABLE ONLY TO CORPORATE ISSUERS:  Indicate the number of shares outstanding
for the issuer's classes of common stock as of the latest practicable date.



       Common Stock                        1,162,279 Shares
       ------------                        ----------------
         (Class)                             (Outstanding)



<PAGE>


                                CB BANCORP, INC.
                                  FORM 10-QSB
                                     INDEX


PART I.           FINANCIAL INFORMATION                                  PAGE
-------           ---------------------                                  ----
Item 1.           Financial Statements

                  Consolidated Balance Sheets,                              1
                  December 31, 1996 and March 31, 1996

                  Consolidated Statements of Income,                        2
                  Three and Nine Months Ended
                  December 31, 1996 and 1995

                  Consolidated Statements of Changes in Share-              3
                  holders' Equity, Nine Months Ended
                  December 31, 1996 and 1995

                  Consolidated Statements of Cash Flows,                  4-5
                  Nine Months Ended December 31, 1996
                  and 1995

                  Notes to Financial Statements                          6-13

Item 2.           Management's Discussion and Analysis of               14-25
                  Financial Condition and Results of Operations.


PART II.          OTHER INFORMATION
--------          -----------------
Item 1            Legal Proceedings                                        26

Item 2-5          N/A                                                      26

Item 6            Exhibits and Reports on Form 8-K                         26

Signature Page                                                             27




<PAGE>


                                CB BANCORP, INC.
                           CONSOLIDATED BALANCE SHEETS



<TABLE>
<CAPTION>
                                                                          Dec. 31,        March 31,
                                                                            1996             1996
                                                                        -----------      -----------
                                                                               (In thousands)
<S> <C>
ASSETS:
Cash and due from financial institutions                                   $  4,088         $  4,755
Interest-earning deposits - Short Term                                        2,226            1,308
                                                                        -----------      -----------
Cash and cash equivalents                                                     6,314            6,063

Securities available-for-sale (reported  at fair value (Note 2)                 648              621
Securities held-to-maturity (fair value: Dec. 31, 1996 -                      5,939            5,675
  $5,916; March 31, 1996 - $5,644) (Note 2)
Other Securities - Federal Home Loan Bank Stock (Note 2)                      2,752            2,702
Mortgage-backed and related securities held-to-maturity (fair value:
  Dec. 31, 1996 - $9,348; March 31, 1996 - $10,282) (Note 3)                  9,239           10,192
Loans
   Loans purchased under agreements to resell (Note 5)                      101,511           80,031
   Loans receivable                                                          90,442           92,616
   Less: Allowance for possible loan losses                                  (2,309)          (1,346)
                                                                        -----------      -----------
                                                                            189,644          171,301
Mortgage loans held for sale                                                  2,099              513
Accrued interest receivable                                                   1,268            1,183
Premises and equipment, net                                                   2,870            2,387
Investment in limited partnership (Note 8)                                    1,633            1,679
Other assets                                                                  4,147            3,069
                                                                        -----------      -----------
  Total assets                                                             $226,553         $205,385
                                                                        ===========      ===========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Liabilities
Deposits                                                                   $150,803         $137,047
Borrowed funds                                                               53,000           45,124
Advance payment by borrowers for taxes and insurance                            580            1,214
Obligation relative to limited partnership (Note 8)                           1,468            1,450
Accrued expenses and other liabilities                                          694            1,718
                                                                       ------------     ------------
  Total liabilities                                                         206,545          186,553

Commitments and contingencies (Note 7)
Shareholders' equity
Serial preferred stock, no par value, 500,000
  shares authorized; none outstanding
Common Stock: $.01 Par Value, 3,000,000 shares
  authorized, 1,284,238 Shares Issued                                            13               13
Additional Paid-in capital                                                    5,803            5,813
Retained earnings, substantially restricted                                  15,890           14,324
Less Treasury Stock: (Shares at cost: Dec. 31, 1996 - 121,959;               (1,543)          (1,082)
  March 31, 1996 - 96,012)
Net unrealized net appreciation on securities available-for-sale                 46               26
Less common stock acquired by employee stock ownership plan                    (193)            (241)
Less common stock acquired by recognition and retention plan                     (8)             (21)
                                                                        -----------      -----------
  Total shareholders' equity                                                 20,008           18,832
                                                                        -----------      -----------
  Total liabilities and shareholders' equity                               $226,553         $205,385
                                                                        ===========      ===========
</TABLE>

See accompanying notes to consolidated financial statements

                                        1

<PAGE>




                                CB BANCORP, INC.
                        CONSOLIDATED STATEMENTS OF INCOME


<TABLE>
<CAPTION>
                                                          THREE MONTHS ENDED                  NINE MONTHS ENDED
                                                              December 31,                       December 31,
                                                          1996           1995                1996          1995
                                                       -----------   -----------          -----------   -----------
<S> <C>                                                           (In thousands-except per share data)
Interest income:
  Loans receivable                                          $1,840        $1,931               $5,602        $5,623
  Loans purchased under agreements to resell                 1,931         1,576                5,487         3,780
  Securities available-for-sale                                  8            54                   23           161
  Securities held-to-maturity                                  153            86                  424           259
  Mortgage-backed securities held-to-maturity                  159           164                  484           524
  Other interest-earning deposits                               12            17                   22            55
                                                       -----------   -----------          -----------   -----------
  Total interest income                                      4,103         3,828               12,042        10,402
                                                       -----------   -----------          -----------   -----------
Interest expense:
  Deposits                                                   1,474         1,385                4,154         3,765
  Borrowed funds                                               570           558                1,801         1,369
                                                       -----------   -----------          -----------   -----------
  Total interest expense                                     2,044         1,943                5,955         5,134
                                                       -----------   -----------          -----------   -----------
Net interest income                                          2,059         1,885                6,087         5,268

  Less provision for loan losses                               450            99                  861           238
                                                       -----------   -----------          -----------   -----------
  Net interest income after provision for loan losses        1,609         1,786                5,226         5,030
                                                       -----------   -----------          -----------   -----------
Noninterest income:
  Gain (loss) on sale of interest-earning assets                79             0                  200             0
  Commission income                                             19            25                   68            73
  Service charges and fees                                     133           127                  392           374
  Fees - loans purchased under agreements to resell            178           104                  486           242
  Late charges                                                   6             6                   20            17
  Other                                                         30            56                   95           132
                                                       -----------   -----------          -----------   -----------
  Total noninterest income                                     445           318                1,261           838
                                                       -----------   -----------          -----------   -----------
Noninterest expense:
  Compensation and employee benefits                           483           400                1,437         1,147
  Occupancy and equipment                                      147           117                  448           376
  SAIF deposit insurance premium                                73            67                  943           194
  Data processing fees                                          59            60                  179           181
  Telephone, postage and supplies                               71            53                  196           149
  Advertising and promotion                                     28            24                   93            70
  Professional fees                                             80            40                  215           113
  Employee expense and payroll taxes                            75            52                  221           137
  Other                                                        119            86                  398           280
                                                       -----------   -----------          -----------   -----------
  Total noninterest expense                                  1,135           899                4,130         2,647
                                                       -----------   -----------          -----------   -----------
Income before taxes                                            919         1,205                2,357         3,221
Income tax expense                                             318           472                  791         1,246
                                                       -----------   -----------          -----------   -----------
Net income                                                  $  601        $  733               $1,566        $1,975
                                                            ======        ======               ======        ======

Earnings per share (Note 6)                                  $0.49         $0.58                $1.26         $1.57
Earnings per share assuming full dilution (Note 6)           $0.49         $0.58                $1.26         $1.56
</TABLE>

See accompanying notes to consolidated financial statements

                                        2

<PAGE>




                                CB BANCORP, INC.
           CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>                                    Unrealized                                         Common Stock      Total
                                             Losses on                                          Acquired by       Share-
Nine Months Ended                Retained    Securities    Common   Paid in       Treasury      -------------     holders
Dec. 31, 1995                    Earnings    A.F.S.        Stock    Capital       Stock         ESOP      RRP     Equity
-------------------------------------------------------------------------------------------------------------------------
  (In Thousands)
<S> <C>
Balance at April 1, 1995          $11,865       $ 2         $13     $5,822        $ (671)      $(305)    (48)     $16,678

Net income                          1,975                                                                           1,975

Issuance of treasury stock                                             (75)          140                               65

Purchase of treasury stock                                                          (554)                            (554)

Contribution to fund ESOP                                                                         48                   48

Amortization of RRP contribution                                                                          23           23

Net change in unrealized                         23                                                                    23
net depreciation of securities
available-for-sale
-------------------------------------------------------------------------------------------------------------------------
Balance at Dec. 31, 1995          $13,840       $25         $13     $5,747        $(1,085)     $(257)   $(25)     $18,258
                                  =======================================================================================
</TABLE>


<TABLE>
<CAPTION>                                    Unrealized                                         Common Stock      Total
                                             Losses on                                         Acquired by       Share-
Nine Months Ended                Retained    Securities    Common   Paid in       Treasury      -------------     holders
Dec. 31, 1996                    Earnings    A.F.S.        Stock    Capital       Stock         ESOP      RRP     Equity
-------------------------------------------------------------------------------------------------------------------------
  (In Thousands)
<S> <C>
Balance at April 1, 1996          $14,324       $26         $13     $5,813        $(1,082)     $(241)   $(21)     $18,832

Net income                          1,566                                                                           1,566

Issuance of treasury stock                                             (10)            19                               9

Purchase of treasury stock                                                           (480)                           (480)

Contribution to fund ESOP                                                                         48                   48

Amortization of RRP contribution                                                                          13           13

Net change in unrealized                         20                                                                    20
net depreciation of securities
available-for-sale
-------------------------------------------------------------------------------------------------------------------------
Balance at Dec. 31, 1996          $15,890       $46         $13     $5,803        $(1,543)     $(193)   $ (8)     $20,008
                                  =======================================================================================
</TABLE>

See accompanying notes to consolidated financial statements

                                        3

<PAGE>




                                CB BANCORP, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS


<TABLE>
<CAPTION>
                                                                                  NINE MONTHS ENDED
                                                                                     December 31,
                                                                             -----------------------------
                                                                                 1996             1995
                                                                             -----------       -----------
                                                                                    (In thousands)
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
 Net income                                                                     $1,566           $1,975
 Adjustments to reconcile net income to net cash from operating activities
  Depreciation and amortization                                                    119              148
  Provision for loan losses                                                        861              238
  (Gain) loss on sale of:
    Interest earning assets                                                       (200)               0
    Foreclosed Real Estate                                                           1                0
  Loans purchased under agreements to resell                                  (804,324)        (525,553)
  Sale of loans purchased under agreements to resell                           782,844          477,967
  Mortgage loans originated for sale                                           (12,715)               0
  Proceeds from sales of mortgage loans held for sale                           11,129                0
  Amortization of RRP contribution                                                  13               23
  Change in accrued interest receivable                                            (85)            (394)
  Change in other assets                                                        (1,078)             289
  Change in accrued interest payable and other liabilities                      (1,024)              23
                                                                             ------------      ------------
      Net cash from operating activities                                       (22,893)         (45,284)



CASH FLOWS FROM INVESTING ACTIVITIES
 Principal collected on:
      Mortgage-backed securities held-to-maturity                                1,646            1,856
      Securities available for sale                                                  6                0
 Purchase of:
      Securities and mortgage backed securities held-to-maturity                (3,719)          (5,272)
      Federal Home Loan Bank Stock                                                 (50)                (202)
 Proceeds from:
      Maturities of securities held-to-maturity                                  2,756            5,894
 Purchase of loans                                                                   0           (1,527)
 Net change in loans                                                             2,180           (3,662)
 Net change in interest-earning deposits in other financial institutions             0              983
 Investment in limited partnership                                                  46              (41)
 Proceeds from the sale of foreclosed real estate                                  333               67
 Property and equipment purchases                                                 (637)             (67)
                                                                             ------------      ------------
      Net cash from investing activities                                         2,561           (1,971)
</TABLE>

                                        4

<PAGE>




                                CB BANCORP, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (continued)


                                                       NINE MONTHS ENDED
                                                          December 31,
                                                  ----------------------------
                                                      1996             1995
                                                  -----------      -----------
                                                         (In thousands)


CASH FLOWS FROM FINANCING ACTIVITIES

 Net change in deposits                               13,746           11,536
 Net change in advances from
   borrowers for taxes and insurance                    (634)            (513)
 New borrowings                                    1,260,326        1,354,570
 Repayments of borrowed funds                     (1,252,432)      (1,311,703)
 Contribution to fund ESOP                                48               65
 Issuance of treasury stock                                9               48
 Purchase of treasury stock                             (480)            (554)
                                                  -----------     ------------
      Net cash from financing activities              20,583           53,449
                                                  -----------     ------------
Net change in cash and cash equivalents                  251            6,194
Cash and cash equivalents at beginning of period       6,063            3,543
                                                  -----------     ------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD            $6,314           $9,737
                                                  ===========     ============
Supplemental disclosures of cash flow information
  Cash paid during the period for
      Interest                                        $5,846           $5,549
      Income taxes                                     1,634            1,090
  Noncash investing activities
      Real estate acquired in settlement of loans     $  334               $0


See accompanying notes to financial statements


                                       5

<PAGE>

                                CB BANCORP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - Basis of Presentation

         The  accompanying  unaudited  consolidated  financial  statements  were
prepared in accordance with instructions for Form 10-QSB and, therefore,  do not
include all disclosures required by generally accepted accounting principles for
complete presentation of financial statements. In the opinion of management, the
consolidated  financial  statements contain all adjustments  (consisting only of
normal recurring accruals) necessary to present fairly the consolidated  balance
sheets of CB Bancorp, Inc., ("the Company"),  and its wholly owned subsidiary,
Community Bank, A Federal Savings Bank ("the Bank"), as of December 31, 1996 and
March  31,  1996  and  the  consolidated   statements  of  income,   changes  in
shareholders'  equity and cash flows for the nine months ended December 31, 1996
and 1995. All significant intercompany  transactions and balances are eliminated
in  consolidation.  The  income  reported  for the three and nine  months  ended
December  31, 1996 is not  necessarily  indicative  of the  results  that may be
expected for the full fiscal year.  For other  accounting  policies refer to the
financial  statements  incorporated  by reference  in the Annual  Report or Form
10-KSB for the fiscal year ended March 31, 1996.


Note 2 - Securities


         The  amortized  cost and fair values of securities at December 31, 1996
are as follows:

<TABLE>
<CAPTION>
                                                   Gross         Gross
                                    Amortized   Unrealized    Unrealized      Fair
                                      Cost         Gains        Losses        Value
                                    ---------    ---------    ---------    ---------
<S> <C>                                              (In thousands)
Available-for-Sale
------------------
     Marketable Equity securities      $  572           77          (1)         648
                                    =========    =========    =========    =========

     Held-to-Maturity
     ----------------
U.S. Government and U.S. Government
  agency securities                   $3,000        $   -        $ (29)      $2,971
Corporate notes                        2,939            7           (1)       2,945
                                    ---------   ----------   ----------   ----------
     Total                            $5,939        $   7        $ (30)      $5,916
                                    =========   ==========   ==========   ==========

     Other Securities
     ----------------
Stock in Federal Home Loan Bank       $2,752        $   -        $   -       $2,752
                                    =========   ==========   ==========   ==========
</TABLE>

                                       6

<PAGE>


                                CB BANCORP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (continued)

Note 2 - Securities (continued)


         The amortized  cost and fair values of securities at March 31, 1996 are
as follows:


<TABLE>
<CAPTION>
                                                     Gross         Gross
                                      Amortized   Unrealized    Unrealized      Fair
                                        Cost         Gains        Losses        Value
                                      ---------    ---------    ---------    ---------
<S> <C>                                                (In thousands)
Available-for-Sale
------------------
Marketable Equity securities               578           44           (1)         621
                                         ======      =======      =======      =======

     Held-to-Maturity
     ----------------
U.S. Government and U.S. Government
  agency securities                     $3,000         $  -       $  (30)      $2,970
Corporate notes                          2,675            5           (6)       2,674
                                      ---------   ----------   ----------   ----------
     Total                              $5,675         $  5       $  (36)      $5,644
                                      =========   ==========   ==========   ==========

     Other Securities
     ----------------
Stock in Federal Home Loan Bank         $2,702         $  -       $   -        $2,702
                                      =========   ==========   ==========   ==========
</TABLE>




         The  amortized  cost and fair value of debt  securities at December 31,
1996, by contractual  maturity,  are shown below. Expected maturities may differ
from  contractual  maturities  because  borrowers  may have the right to call or
prepay obligations with or without call or prepayment penalties.



                                                     Dec. 31, 1996
                                                 ----------------------
                                                 Amortized       Fair
                                                   Cost          Value
                                                 ---------    ----------
                                                     (In thousands)
    Due in one year or less .................      $2,446        $2,448
    Due after one year through five years ...       3,493         3,468
                                                 ---------    ----------
                                                   $5,939        $5,916
                                                 =========    ==========


                                      7

<PAGE>




                                CB BANCORP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (continued)

Note 2 - Securities (continued)


         There were no sales of  securities  available-for-sale  during the nine
months ended December 31, 1996.

At December 31, 1996,  there were no holdings of  securities  of any one issuer,
other than the U.S.  government  and its agencies and  corporations,  in amounts
greater than 10% of shareholders' equity.


Note 3 - Mortgage-Backed and Related Securities

         The  carrying  value  and fair  value of  mortgage-backed  and  related
securities held-to-maturity as presented on the balance sheets are summarized as
follows:

<TABLE>
<CAPTION>
                                             December 31, 1996
                           -----------------------------------------------------------
                           Principal     Unamortized  Unearned     Carrying     Fair
                            Balance       Premiums    Discounts      Value      Value
                           -----------------------------------------------------------
                                              (In Thousands)
<S> <C>
GNMA certificates            $ 3,309     $   6        $    (5)    $ 3,310    $ 3,375
FHLMC certificates             4,678         -             (2)      4,676      4,708
FNMA certificates                900         -            (10)        890        901
Collateralized mortgage
 obligations                     365         -             (2)        363        364
                           -----------------------------------------------------------
     Total                   $ 9,252     $   6         $  (19)    $ 9,239    $ 9,348
                           ===========================================================
</TABLE>


<TABLE>
                                              March 31, 1996
                           -----------------------------------------------------------
                           Principal     Unamortized  Unearned     Carrying     Fair
                            Balance       Premiums    Discounts      Value      Value
                           -----------------------------------------------------------
                                              (In Thousands)
<S> <C>
GNMA certificates            $ 3,600     $   9         $  (10)    $ 3,599    $ 3,646
FHLMC certificates             4,892         3             (6)      4,889      4,914
FNMA certificates                880         -             (8)        872        886
Collateralized mortgage
 obligations                     834         1             (3)        832        836
                           -----------------------------------------------------------
     Total                   $10,206     $  13         $  (27)    $10,192    $10,282
                           ===========================================================
</TABLE>

                                        8

<PAGE>


                                CB BANCORP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (continued)

Note 3 - Mortgage-Backed and Related Securities (continued)

         Gross  unrealized  gains and  losses  on  mortgage-backed  and  related
securities held-to-maturity are as follows:

<TABLE>
<CAPTION>
                                      Dec. 31, 1996                 March 31, 1996
                               ------------------------      ------------------------
                                 Gross         Gross           Gross         Gross
                               Unrealized    Unrealized      Unrealize     Unrealized
                                 Gains         Losses          Gains         Losses
                               ----------    ----------      ----------    ----------
                                                  (In thousands)
<S> <C>
GNMA certificates                  $  65        $  -              $  53       $  (7)
FHLMC certificates                    40          (8)                72         (47)
FNMA certificates                     11           -                 14           -
Collateralized mortgage
 obligations                           2          (1)                 4           -
                              ----------   ----------        ----------   ----------
  Total                            $ 118       $  (9)            $  143      $  (54)
                              ==========   ==========        ==========   ==========
</TABLE>

         The Company  did not sell any  mortgage-backed  and related  securities
held-to-maturity  during the nine months ended  December 31, 1996 and during the
nine months ended December 31, 1995.

Note 4 - Concentrations of Credit Risk

         The Company grants real estate and consumer loans including  education,
home  improvement  and other  consumer  loans  primarily  in LaPorte  and Porter
counties of Indiana.  Substantially all loans are secured by consumer assets and
real estate. Loans purchased under agreements to resell are residential mortgage
loans secured by one to four family  residences  located  throughout  the United
States.


Note 5 - Loans Purchased Under Agreements to Resell

         The Company purchases residential mortgage loans from various mortgage
companies  prior  to  sale of  these  loans  by the  mortgage  companies  in the
secondary market.  The Company purchases such loans from mortgage  companies at
par, net of certain fees, and later sells them back to the mortgage companies at
the same amount and without  recourse  provisions.  The Company records interest
income on the loans during the funding period and the Company records fee income
(recorded as  noninterest  income)  received from the mortgage  company for each
loan when resold. Purchase money and refinance mortgage loans are generally held
no more than 90 days by the Company  and  typically  are resold  within 30 days.
Construction  loan  mortgages  purchased,  are  held  for  the  duration  of the
construction  period which is typically six months or longer. With regard to the
interim  construction  loans in the pipeline,  the Company recognizes that there
may be credit risk due to possible change in the borrower's  financial condition
during the interim construction period. The Company had

                                        9

<PAGE>


                                CB BANCORP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (continued)


Note 5 - Loans Purchased Under Agreements to Resell (continued)

approximately  $32.7  million of interim  construction  loans in the pipeline at
December 31, 1996 as compared to $29.4 million at March 31, 1996.

NOTE 6 - Earnings Per Common Share

         Earnings  per  common  and common  equivalent  share were  computed by
dividing net income by the weighted-average number of shares of common stock and
common stock  equivalents  outstanding.  Employee and Director stock options are
considered  common  stock  equivalents.  The  weighted-average  number of shares
outstanding  for the  calculation  of  earnings  per  common  and  common  stock
equivalent  share for the three  months  ended  December  31,  1996 and 1995 was
1,237,895 and 1,254,192,  respectively.  The  weighted-average  number of shares
outstanding for the calculation of fully-diluted  earnings per common and common
stock equivalent share for the three months ended December 31, 1996 and 1995 was
1,238,077 and 1,254,613, respectively.

         The  weighted-average  number of shares outstanding for the calculation
of earnings  per common and common  stock  equivalent  share for the nine months
ended December 31, 1996 and 1995 was 1,241,567 and 1,261,923,  respectively. The
weighted-average   number  of  shares   outstanding   for  the   calculation  of
fully-diluted earnings per common and common stock equivalent share for the nine
months  ended   December  31,  1996  and  1995  was  1,246,235  and   1,267,356,
respectively.


Note 7 - Commitments and Contingencies

         The Company is a party to financial instruments with  off-balance-sheet
risk in the  normal  course  of  business  to meet  the  financing  needs of its
customers.  These  financial  instruments  include  commitments  to make loans,
standby letters of credit and unused lines of credit.  The Company's exposure to
credit loss, in the event of  nonperformance by the other party to the financial
instrument for  commitments to make loans,  standby letters of credit and unused
lines of credit, is represented by the contractual  amount of those instruments.
The  Company  follows  the same  credit  policy to make such  commitments  as it
follows for those loans  recorded in the financial  statements.  At December 31,
1996,  and March 31, 1996,  the Company had  commitments  to make loans totaling
$558,000  and  $137,000  respectively  and standby  letters of credit and unused
lines of  credit  totaling  $6.7 million  and $5.4  million,  respectively.  In
addition,  the  Company's  undisbursed  portion  of  construction  loans  in the
repurchase  program totaled $12.0 million at December 31, 1996 and $12.4 million
at March 31, 1996.  Outstanding  commitments  to make loans at December 31, 1996
consisted of nine single family mortgage loans,  consisting of three  adjustable
rate loans totalling $215,000 and six fixed rate loans totalling $343,000. Since
commitments to make loans and to fund lines and letters of credit

                                       10

<PAGE>


                                CB BANCORP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (continued)


Note 7 - Commitments and Contingencies (continued)

may expire without being used, the amounts do not necessarily  represent  future
cash commitments.

Note 8 - Affordable Housing Tax Credit Project

         The  Company,  through  the  Bank's  subsidiary,  Community  Financial
Services,   Incorporated,   has  a  99%  limited  partner   interest  in  Pedcor
Investments-1994-XX,  L.P. which was formed for the construction, ownership, and
management of an 80 unit apartment  project  located in Michigan City,  Indiana.
Financing  consists of a $2,550,000  first  mortgage loan funded with tax exempt
bonds.

The Bank is the lead lender in the debt financing arrangement and has guaranteed
through letters of credit $1,550,000 of the debt financing, which represents the
Bank's share of the mortgage loan.  The remaining  portion of the debt financing
is  guaranteed by  participating  lenders  through  letters of credit in amounts
proportional to their loan amounts. The Bank and other lending institutions have
as their  security a first  mortgage lien and  assignment of rents and leases on
the apartment complex. As of December 31, 1996, Community Financial has invested
$1,633,000 in the limited partnership.  Community Financial contributed $165,000
in  cash to the  partnership  while  the  remaining  $1,468,000  was  funded  by
short-term  tax-exempt  notes  backed by a letter of credit  issued by the Bank.
Terms of the partnership  agreement  allocate 99% of the eligible tax credits to
the Company.  For the year ended March 31, 1996, the Company received $70,000 in
tax  credits,  which  were the  first  tax  credits  received  from the  limited
partnership.  For the nine months ended December 31, 1996, the Company  recorded
$111,000 in anticipated tax credits from the limited partnership.


Note 9 - Allowance for Loan Losses

         The  allowance  for loan losses is  increased  by charges to income and
decreased by charge-offs  (net of recoveries).  Estimating the risk of loss and
the  amount  of loss on any loan is  necessarily  subjective.  Accordingly,  the
allowance is maintained by  management at a level  considered  adequate to cover
losses that are currently  anticipated.  Management's periodic evaluation of the
adequacy of the allowance is based on the Company's  past loan loss  experience,
known and inherent risks in the portfolio,  adverse  situations  that may affect
the  borrowers   ability  to  repay,  the  estimated  value  of  any  underlying
collateral,  and current economic  conditions.  In addition,  various regulatory
agencies, as an integral part of their examination process,  periodically review
the Company's  allowance for losses on loans and  foreclosed  real estate.  Such
agencies may require the Company to recognize additions to the allowances based
on  their  judgments  of  information  available  to them at the time of their
examination.

                                       11


<PAGE>


                                CB BANCORP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (continued)

Note 9 - Allowance for Loan Losses (continued)

Activity  in the  allowance  for loan  losses was as follows for the nine months
ended December 31 (In Thousands).


                                             1996            1995
                                           ---------       ---------
            Balance at March 31              $1,346         $  672

            Provision for loan losses           861            238
            Charged-off loans                   (16)            (3)
            Recoveries                          118              -
                                           ---------      ---------
            Balance at Dec. 31               $2,309         $  907
                                           =========      =========

Information  regarding  impaired  loans is as follows for the nine months  ended
December 31, 1996:

 Average investment in impaired loans                                    $2,853
 Interest income recognized on impaired loans
  including interest income recognized on cash basis                         77
 Interest income recognized on impaired loans on cash basis                  67

Information regarding impaired loans at December 31, 1996 is as follows:

 Balance of impaired loans                                               $4,690
 Less portion for which no allowance for loan losses is allocated        (1,223)
                                                                        -------
 Portion of impaired loan balance for which an
  allowance for loan losses is allocated                                 $3,467
                                                                        =======
 Portion of allowance for loan losses allocated to impaired loan balance $  629
                                                                        =======

Of the total  balance of impaired  loans as of December 31,  1996,  $1.6 million
relates to amounts  associated  with the Bennett  Funding  Group,  Inc.  and its
affiliate Aloha Capital  Corporation (f.k.a.  Bennett Leasing).  Bennett Funding
Group, Inc. sought Chapter 11 Bankruptcy  protection on March 29, 1996.  Several
weeks later, Aloha Capital Corporation was placed into involuntary bankruptcy at
the request of the court appointed Bankruptcy Trustee for Bennett Funding Group,
Inc., who is now also the Bankruptcy Trustee for Aloha Capital Corporation.  Per
the terms of the contractual  arrangements,  Bennett Funding Group, Inc. acts as
the servicing  agent for the Company on one pool of leases  purchased  from that
entity,  wherein,  at December  31, 1996,  $396,000 of principal  remained to be
remitted  to the  Company  over the  course  of the  remaining  scheduled  lease
payments due from  individual  lessees.  Similarly,  at December 31, 1996,  $1.2
million of  principal  remained  to be remitted to the Company on three pools of
leases purchased from and serviced by Aloha Capital Corporation. Payment due the
Company on the four  pools of leases  were  current  at the time the  respective
servicing  companies  were  placed in  bankruptcy.  The  Bankruptcy  Trustee  is
monitoring the lease payment billing and collection  activities of the servicing
companies and is segregating the payments  received from the individual  lessees
but has not yet allowed the  resumption  of the payment  stream due the Company.
Management  believes that it is possible to recover 78.5% - 82% of the
outstanding principal balance over the remaining life of the leases.  Management
can make no assurances  as to the  outcome  of  this  matter,  or if any of the
outstanding principal  balance  will be  recovered.  Management  has  allocated
$329,000 in specific loan loss reserves at December 31, 1996, for the Bennett
Funding Group, Inc., leases.

                                       12

<PAGE>

                                CB BANCORP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (continued)

Note 9 - Allowance for Loan Losses (continued)


Management has allocated $300,000 in specific loan loss reserves at December 31,
1996,  for 23 single  family  construction  loans,  all  located in the  central
Indiana  area,  with a total  balance  outstanding  of $2.5  million  and  total
unfunded commitments of $494,000 that are in workout situations. Twenty of these
loans are  outstanding  to a builder  that is currently  experiencing  financial
difficulties  and is in  the  process  of  filing  Chapter  11  Bankruptcy.  The
properties  underlying  these  loans are in  various  stages of  completion  and
management  has not yet  determined  the potential loss exposure on these loans.
The properties  underlying the remaining three loans have a combined outstanding
balance of $1.2 million and construction is complete.


                                       13

<PAGE>


                      Management's Discussion and Analysis
                              of Plan of Operation


General

         The  Company's  results of operations  are  dependent  primarily on the
Bank. The Bank's primary source of earnings is its net interest  income which is
the difference between the interest income earned on its loans,  mortgage-backed
securities and investment  portfolios less its cost of funds,  consisting of the
interest  paid on its  deposits  and  borrowings.  Operating  results  are  also
affected by the types of lending  engaged in,  fixed-rate  versus  adjustable or
short-term,  each of which has a different rate and fee structure. The Company's
operating expenses  principally  consist of employee  compensation and benefits,
occupancy and equipment  expenses,  federal deposit insurance premiums and other
general and  administrative  expenses.  The Company's  results of operations are
also  significantly  affected by general  economic and  competitive  conditions,
particularly  changes in market interest rates,  government policies and actions
of regulatory authorities.



Mortgage Loan Reverse Repurchase Program

         In fiscal  1991,  the Company  instituted  the  Mortgage  Loan Reverse
Repurchase  Program (the  "Program").  There are currently  seventy-nine  active
participants  in the Program.  The Mortgage Loan Reverse  Repurchase  Program is
carried out pursuant to agreements with each  participant  which provide for the
purchase at par (less certain fees paid to the  participant  by the borrower) of
whole mortgage loans by the Company, at its option, and the subsequent resale of
such loans to the Participant (for transfer to an end investor).  Purchase money
and  refinance  mortgage  loans are  generally  held no more than 90 days by the
Company and  typically are resold within 30 days.  Construction  loan  mortgages
acquired via the Program,  are held for the  duration of the  construction  loan
period,  typically for six months or longer. At December 31, 1996,  construction
loan  balances  totaled  $32.7  million and accounted for 32.2% of the Company's
total outstanding investment in the Program.  Construction loan balances totaled
$29.4  million at March 31, 1996.  The Company  records  interest  income on the
loans based on a rate of interest  tied to the prime rate (as  established  from
time to time by a major Chicago-based  financial institution) during the funding
period,  and  not  the  rates  on  individual  loans,  plus a fee  (recorded  as
noninterest  income) collected from the Participant for each loan when that loan
is resold.  It is the Company's  policy to purchase under the Program only those
loans that comply with accepted  secondary market  underwriting  standards.  The
Company's  Mortgage  Loan  Reverse  Repurchase  Program  has  been  and is a key
contributor to the Company's  efforts to maintain a strong net interest  margin.
Management is aware that a decline in Program activity would  negatively  impact
the Company's profitability.

                                       14

<PAGE>


Financial Condition


         Total assets  increased  $21.2 million or 10.3%,  to $226.6  million at
December  31,  1996 from  $205.4  million at March 31,  1996.  The  increase  is
primarily  attributable  to a $21.5 million or 26.9% increase in loans purchased
under  agreements  to  resell  under the  Program.  Management  attributes  this
increase to an increase in mortgage  refinancings and home mortgage originations
due to an  increase  in the number of mortgage  companies  participating  in the
Program. Since its inception,  the Program has caused the level of the Company's
assets and liabilities  and capital ratios to  significantly  fluctuate  between
periods. The $2.2 million decrease in loans receivable results from management's
decision to sell a majority of the Company's single family loan production. This
decision  also  resulted in a $1.6 million  increase in Mortgage  loans held for
sale.  Over this same time  period,  FHLB Stock and  securities  increased  $0.3
million  or 3.8%;  other  assets  increased  $1.1  million  or  35.1%  primarily
attributable  to  changes  in  the  Company's   income  tax   obligations,   and
mortgage-backed and related securities  decreased $1.0 million or 9.4%. Premises
and  equipment,  net,  increased  $0.5 million or 20.6% due to the completion of
renovations at our LaPorte branch facility.


Total  borrowed  funds  increased  $7.9  million or 17.5%,  to $53.0  million at
December  31,  1996 from  $45.1  million at March 31,  1996.  This  increase  is
attributable  to the  increased  funding  needs of the Program.  Borrowed  funds
outstanding   at  December  31,  1996  consist  of  $46.0  million  in  advances
outstanding  with the  Federal  Home Loan Bank of  Indianapolis,  of which $45.0
million have maturities of one year or less, and federal funds purchased of $7.0
million.


Deposits  increased  $13.8 million or 10.0%,  to $150.8  million at December 31,
1996,  from  $137.0  million at March 31,  1996.  The increase in  deposits  is
primarily  attributable to the company accepting  institutional and public funds
deposits to meet the increased funding needs of the Program.


The primary objective of the Company's $18.6 million securities  portfolio is to
contribute  to  profitability  by  providing  a stable  cash flow of  dependable
earnings.   The  investment   portfolio  consists  of  U.S.   Government  Agency
securities,  short-term  investment  grade corporate notes and Federal Home Loan
Bank Stock.  The Company also has  investments  in both  variable and fixed rate
U.S. Government Agency  mortgage-backed  securities and collateralized  mortgage
obligations.  The  Company's  portfolio  of  securities  contains no  securities
classified  by  the  Federal   Banking   Regulators  as  "High  Risk  Derivative
Securities".

                                       15

<PAGE>


Risk Elements

Non-performing  Assets:  Non-performing  assets totaled $5.4 million at December
31, 1996, an increase of $2.5 million from March 31, 1996. Loan loss reserves at
December 31, 1996 totaled $2.3 million or 42.4% of total  non-performing  assets
and increased $963,000 from March 31, 1996.


The increase in impaired  loans is related to the  construction  loan segment of
the Company's  Mortgage Loan Reverse Repurchase  Program.  At December 31, 1996,
the Company had 23 single family  construction loans, all located in the central
Indiana  area,  with a total  balance  outstanding  of $2.5  million  and  total
unfunded commitments of $494,000 that are in workout situations. Twenty of these
loans are  outstanding  to a builder  that is currently  experiencing  financial
difficulties  and is in  the  process  of  filing  Chapter  11  Bankruptcy.  The
properties  underlying  these  loans are in  various  stages of  completion  and
management  has not yet  determined  the potential loss exposure on these loans.
The properties  underlying the remaining three loans have a combined outstanding
balance of $1.2 million and  construction is complete.  Management has allocated
$525,000,  $300,000  of which is  specific,  to the  allowance  for loan  losses
balance at December 31, 1996, for these 23 construction loans.



Also included in the December 31, 1996 impaired assets total, is $1.6 million in
principal due the Company on four pools of small business  equipment leases that
the Company acquired through contractual relationships entered into with Bennett
Funding Group, Inc. and its affiliate Aloha Capital Corporation (f.k.a.  Bennett
Leasing  Corporation).  Bennett Funding Group, Inc. sought Chapter 11 Bankruptcy
protection on March 29, 1996. Several weeks later, Aloha Capital Corporation was
placed  into  involuntary  bankruptcy  at the  request  of the  court  appointed
Bankruptcy  Trustee  for  Bennett  Funding  Group,  Inc.,  who is now  also  the
Bankruptcy  Trustee  for  Aloha  Capital  Corporation.  Per  the  terms  of  the
contractual  arrangements,  Bennett  Funding  Group,  Inc. acts as the servicing
agent for the Company on one pool of leases purchased from that entity, wherein,
at  December  31,  1996,  $396,000 of  principal  remained to be remitted to the
Company  over the course of the  remaining  scheduled  lease  payments  due from
individual lessees.  Similarly,  at December 31, 1996, $1.2 million of principal
remained to be remitted to the Company on three pools of leases  purchased  from
and serviced by Aloha Capital  Corporation.  Payment due the Company on the four
pools of leases were current at the time the respective servicing companies were
placed in  bankruptcy.  The  Bankruptcy  Trustee is monitoring the lease payment
billing and collection  activities of the servicing companies and is segregating
the payments  received from the  individual  lessees but has not yet allowed the
resumption of the payment  stream due the Company.  Management  believes that it
is possible to recover 78.5% - 82% of the  outstanding  principal  balance over
the remaining  life of the  leases.  Management  can  make no  assurances  as to
the outcome of this matter,  or if any of the outstanding  principal balance
will be recovered.  Management has allocated  $329,000 in specific loan loss
reserves at December 31, 1996, for the Bennett Funding Group, Inc., leases.

                                       16

<PAGE>


                        Schedule of Non-performing Asset

                                   Dec. 31,    March 31,       Dec. 31,
                                     1996         1996           1995
                                  ----------   ----------     ----------
                                             (In Thousands)
Accruing mortgage loans
  delinquent more than 90 days       $   -         $   -          $   -
Accruing consumer and other
  loans delinquent more than
  90 days                                1             4              3
Non-accruing mortgage loans
  delinquent more than 90 days         466           523          1,245
Non-accruing consumer and
  other loans delinquent more
  than 90 days                           -             -              -
                                  ----------   ----------     ----------
Total loans delinquent more
  than 90 days                          467          527          1,248
Restructured loans                      292          306            359
Impaired Loans                        4,690        2,164              -
                                  ----------   ----------     ----------
Total non-performing loans            5,449        2,997          1,607
Total real estate owned,
  net of related reserves                 0            -              0
                                  ----------   ----------     ----------
Total non-performing assets        $  5,449     $  2,997        $ 1,607
                                  ==========   ==========     ==========
Total non-performing assets
  to total loans                      2.84%        1.74%          1.77%
Total non-performing assets
  to total assets                     2.41         1.46           0.81
Total loan loss allowances
  to non-performing assets           42.37        44.91          56.44

                                       17

<PAGE>



Interest Rate Sensitivity

The Company's primary strategy for controlling  interest rate risk exposure,  is
to maintain a high level of the  Company's  asset  portfolios  in interest  rate
sensitive  assets.  Management  has  accomplished  this  objective  through  its
investment  in the Loan  Reverse  Repurchase  Program.  Under the  Program,  the
Company purchases single family  mortgage  loans from select  mortgage  banking
firms on a short-term  basis under  agreements to resell and earns an adjustable
prime based return during the holding period.  The Program has  complemented the
Company's  portfolio of adjustable rate loans held for investment  which account
for  approximately  36% of the loans  receivable  portfolio.  In  addition,  the
Company has sought to lengthen the maturity of its interest-bearing  liabilities
by emphasizing  longer term  certificates  of deposit.  The Company also has the
ability  to  obtain  long-term  advances  from the  Federal  Home  Loan  Bank of
Indianapolis if such  borrowings  appear  favorable under a particular  interest
rate environment.


Management  regularly  measures the Bank's  interest rate risk by monitoring the
Company's  interest rate risk ("IRR") measures produced by the Office of Thrift
Supervision from the Bank's quarterly  thrift  financial  reports.  In 1990, the
regulators  adopted  the  interest-rate  sensitivity  approach as one measure of
interest-rate  risk.  This  approach  measures  the  projected  changes  in  net
portfolio  value ("NPV") that would result if interest rates were to increase by
100, 200, 300 and 400 basis points, or if interest rates were to decline by 100,
200,  300 and 400 basis  points.  Net  portfolio  value is defined by the market
value of assets less the market value of liabilities. According to the "Interest
Rate Risk Report," prepared by the Office of Thrift  Supervision as of September
30,  1996 (most  recent  available),  after an adverse  rate shock of +200 basis
points, the Bank's NPV of $22.6 million was projected to decline $1.2 million or
5.4%, to $21.4 million.  According to the OTS report,  80% of Thrifts nationwide
would have  experienced  an decline of more than 7.1%.  Presented  below,  as of
September 30, 1996, is an analysis of the Bank's  interest rate risk as measured
by changes in NPV for instantaneous and substantial parallel shifts of 100 basis
points in market interest rates.


             Interest Rate Sensitivity of Net Portfolio Value (NPV)

                               Net Portfolio Value
                               -------------------

               Change
              in rates     $  Amount    $  Change     %  CHANGE
              --------     ---------    ---------     ---------
               +400 bp        19,737       -2,863          -13%
               +300 bp        20,584       -2,016          - 9%
               +200 bp        21,386       -1,214          - 5%
               +100 bp        22,079       -  521          - 2%
                  0 bp        22,600
               -100 bp        22,789       +  189          + 1%
               -200 bp        22,308       -  292          - 1%
               -300 bp        22,154       -  446          - 2%
               -400 bp        22,387       -  213          - 1%

                                       18

<PAGE>


Comparison of Operating Results

Three Months Ended December 31 1996, Compared to Three Months
-------------------------------------------------------------
Ended December 31, 1995
-----------------------

General:  The Company reported net income of $601,000 for the three month period
ended  December 31, 1996 which  represents an 18.0% decrease over the comparable
three-month period in 1995 in which the Company reported net income of $733,000.
The decrease in net income is primarily attributable to management's decision to
set aside  $450,000 in loan loss  provisions  for the three month  period  ended
December 31, 1996 in comparison to $99,500 in loan loss provisions for the three
month period ended December 31, 1995.

Interest Income:  Interest income increased  $275,000 million or 7.2%, from $3.8
million at December 31, 1995, to $4.1 million at December 31, 1996. The increase
in interest  income is primarily  attributable  to an increase in the  Company's
outstandings  in the Mortgage  Loan Reverse  Repurchase  Program.  The Company's
average outstanding  investment in the Program increased $16.6 million or 25.1%,
from $66.1 million for the three months ended December 31, 1995 to $82.7 million
for the three  months  ended  December  31,  1996.  Over this same time  period,
interest income on loans purchased under agreements to resell increased $355,000
or 22.5%.  The increase in  outstandings  in the Program is  attributable  to an
increase in  mortgage  refinancings  and home  mortgage  originations  due to an
increase in the number of mortgage companies participating in the Program.

Interest Expense: Interest expense increased $101,000 or 5.2%, from $1.9 million
for the three months  December  31,  1995,  to $2.0 million for the three months
ended December 31, 1996. The increase is primarily  attributable to an $89,000
or 6.4% increase in interest on deposits  and a $12,000 or 2.2%  increase in
interest on borrowings resulting from the increased funding needs of the
Program.

Net Interest  Income:  Net interest  income before the provision for loan losses
increased  by $174,000  or 9.2% from $1.9  million  for the three  months  ended
December 31, 1995, to $2.1 million for the three months ended December 31, 1996.
This increase in net interest  income over the prior year's quarter is primarily
attributable  to  management's  efforts  to  profitably  grow the  Loan  Reverse
Repurchase Program.

Provision for Loan Losses:  The provision for loan losses increased $351,000 or
354.5%,  from $99,000 for the three months ended  December 31, 1995, to $450,000
for the three months ended December 31, 1996.  Management's decision to increase
the provision reflects upon an increase in the Company's level of non-performing
assets and increased  activity in construction  lending,  commercial lending and
consumer  lending.  The Company will  continue to monitor its allowance for loan
losses and make future loan loss provisions in  consideration  of the amount and
types of loans in its portfolio and as economic conditions dictate.

                                       19

<PAGE>


Noninterest  income:  Noninterest income increased $127,000 or 39.9% to $445,000
for the three months ended December 31, 1996, from $318,000 for the three months
ended December 31, 1995.  This increase was primarily  attributable to a $74,000
or 71.2% increase in fees related to the repurchase  program,  and to $79,000 in
gains realized from the sale of single family mortgage loans.


Noninterest  expense  Noninterest  expense  increased  $236,000 or 26.3% to $1.1
million for the three months ended December 31, 1996, from $899,000 for the same
time period in the prior year. The increase in noninterest expenses is primarily
attributable  to  increased  personnel  and  occupancy  expenses  related to the
Company's newly established Mortgage Banking Division.


Income Tax  Expense:  Income  tax  expense  decreased  $154,000  or 32.6%,  from
$472,000 for the three months ended December 31, 1995, to $318,000 for the three
months ended  December 31, 1996.  This decrease is primarily  attributable  to a
decrease in earnings.


Nine Months Ended December 31 1996, Compared to Nine Months Ended
December 31, 1995

General: The Company reported net income of $1,566,000 for the nine month period
ended  December 31, 1996 which  represents a 20.7%  decrease over the comparable
nine-month  period  in 1995 in which the  Company  reported  net  income of $2.0
million. The decrease in net income is primarily attributable to a non-recurring
pre-tax  charge  of  $723,000  resulting  from  legislation  signed  into law on
September 30, 1996 to recapitalize the Federal Deposit  Insurance  Corporation's
(FDIC)  Savings  Association  Insurance  Fund  (SAIF).  This one  time,  special
assessment  reduced  second  quarter after tax earnings by $437,000 or $0.36 per
share.  Earnings  were also  negatively  impacted  by  management's  decision to
increase loan loss provisions.

Interest  Income:  Interest income  increased $1.6 million or 15.8%,  from $10.4
million at December  31,  1995,  to $12.0  million at  December  31,  1996.  The
increase  in interest  income is  primarily  attributable  to an increase in the
Company's  outstandings  in the Mortgage Loan Reverse  Repurchase  Program.  The
Company's average outstanding  investment in the Program increased $29.9 million
or 47.5%,  from $53.5  million for the nine months  ended  December  31, 1995 to
$78.9 million for the nine months ended  December 31, 1996.  Over this same time
period,  interest income on loans purchased under agreements to resell increased
$1.4  million  or  61.4%.  The  increase  in  outstandings  in  the  Program  is
attributable  to  an  increase  in  mortgage   refinancings  and  home  mortgage
originations   due  to  an  increase   in  the  number  of  mortgage   companies
participating in the Program.

                                       20

<PAGE>


Interest  Expense:  Interest  expense  increased  $821,000  or 16.0%,  from $5.1
million for the nine months ended  December  31,  1995,  to $6.0 million for the
nine months ended December 31, 1996. The increase is primarily attributable to a
$432,000 or 31.6%  increase in  interest on  borrowings  and a $389,000 or 10.3%
increase in interest on deposits  resulting from the increased  funding needs of
the Program.

Net Interest  Income:  Net interest  income before the provision for loan losses
increased  by  $819,000 or 15.5% from $5.3  million  for the nine  months  ended
December 31, 1995, to $6.1 million for the nine months ended  December 31, 1996.
This  increase in net interest  income over the prior year's period is primarily
attributable  to  management's  efforts  to  profitably  grow the  Loan  Reverse
Repurchase Program.

Provision for Loan Losses:  The provision for loan losses increased $623,000 or
195.7%,  from $238,000 for the nine months ended  December 31, 1995, to $861,000
for the nine months  ended  December 31,  1996.  The  increase in the  provision
reflects  an  increase  in the  Company's  level of  non-performing  assets  and
increased  activity in  construction  lending,  commercial  lending and consumer
lending.  The Company will continue to monitor its allowance for loan losses and
make future loan loss  provisions  in  consideration  of the amount and types of
loans in its portfolio and as economic conditions dictate.

Noninterest income: Noninterest income increased $423,000 or 50.5% to $1,261,000
for the nine months ended  December 31, 1996,  from $838,000 for the nine months
ended December 31, 1995. This increase was primarily  attributable to a $244,000
or 100.8% increase in fees related to the repurchase program, and to $200,000 in
gains realized from the sale of single family mortgage loans.

Noninterest expense: Noninterest expense increased $1.5 million or 56.0% to $4.1
million for the nine months ended  December 31, 1996,  from $2.6 million for the
same time period in the prior year.  The  increase  in  noninterest  expenses is
primarily  attributable  to a $723,000  increase in deposit  insurance  premiums
resulting from the one time assessment cited above, and increased  personnel and
occupancy  expenses related to the Company's newly established  Mortgage Banking
Division.

Income Tax Expense:  Income tax expense  decreased  $455,000 or 38.8%, from $1.2
million for the nine months ended  December  31, 1995,  to $791,000 for the nine
months ended  December 31, 1996.  This decrease is primarily  attributable  to a
decrease in earnings.

                                       21

<PAGE>


Liquidity and Capital Resources

   The Bank is  required  under  applicable  federal  regulations  to maintain a
liquidity  ratio at  certain  specified  levels  which are  subject  to  change.
Currently,  a minimum of 5.0% of the  combined  total of deposits and short term
borrowings must be maintained in the form of liquid assets. At December 31, 1996
liquidity as measured for regulatory purposes was 6.8% as compared to a ratio of
7.7% at March 31, 1996.

Management  structures the liquid asset portfolio and borrowing  capacity of the
Company  to meet the cash  flow  needs of  operating,  investing  and  financing
activities. The Company's net liquid assets are cash and cash equivalents, which
include investments in highly liquid investments.  At December 31, 1996 cash and
cash  equivalents  totaled $6.3 million.  In addition,  the Company maintains a
$5.0  million  line of credit with the FHLB of  Indianapolis  to meet short-term
liquidity needs.

Cash flows  from  operating  activities  consisted  primarily  of net income and
activity  under the Program.  Net cash flows  provided for operating  activities
were ($22.9)  million and ($45.3) million for the nine months ended December 31,
1996 and 1995, respectively.  The Company's  primary investing  activities have
been the purchase and monitoring of securities and  mortgage-backed  securities
and the purchase,  origination  and repayment of loans.  Net cash flows provided
from  investing  activities  were $2.6  million and ($2.0)  million for the nine
months ended December 31, 1996 and 1995, respectively. Cash flows from financing
activities  consisted of deposit  activity,  new borrowings and the repayment of
borrowings.  Net cash flow provided from financing activities were $20.6 million
and $53.4 million for the nine months ended December 31, 1996 and 1995.

Shareholders' equity at December 31, 1996 was $20.0 million, an increase of $1.2
million or 6.2% over March 31, 1996,  which  represents  net income for the nine
months  ended  December  31,  1996,  adjustments  for  the  Company's  ESOP  and
management  recognition  and  retention  plans,  the  purchase  and  issuance of
treasury  stock  and  change  in  unrealized  net   appreciation  on  securities
available-for-sale.

The Bank is subject to three capital  standards  pursuant to regulations of the
Office of Thrift  Supervision:  a 1.5% tangible capital standard,  a 3% leverage
(core and  capital)  ratio and an 8% risk based  capital  standard.  Under these
capital requirements, at December 31, 1996, the Bank had:

- tangible  capital of $17.6 million or 7.8% of total assets  thereby  exceeding
the 1.5% requirement  ($3.4 million) by $14.2 million.
- core capital (tangible capital plus certain intangible assets) of $17.6
million or 7.8% of total assets thereby  exceeding  the 3.0%  requirement  ($6.8
million) by $10.8  million.
- risk-based  capital  (core  capital  plus  allowance  for loan  losses) of
$19.3 million or 13.7% of risk-based  assets  thereby  exceeding the 8.0%
requirement ($11.3 million) by $8.0 million.


                                       22

<PAGE>



Impact of New Accounting Standards

SFAS No. 125,  Accounting  for  Transfer and  Servicing of Financial  Assets and
Extinguishment of Liabilities,  provides  accounting and reporting standards for
transfers and servicing of financial assets and  extinguishments  of liabilities
and requires a consistent  application of a  financial-components  approach that
focuses on control.  Under that approach,  after a transfer of financial assets,
an entity  recognizes  the financial  and  servicing  assets it controls and the
liabilities it has incurred and derecognizes liabilities when extinguished. SFAS
No. 125 also  supersedes  SFAS No. 122, and requires that  servicing  assets and
liabilities be  subsequently  measured by amortization in proportion to and over
the period of estimated net servicing income or loss and requires  assessment in
proportion to and over the period of estimated net servicing  income or loss and
requires assessment for asset impairment or increased  obligation based on their
fair values.  SFAS No. 125 applies to transfers and  extinguishments  occurring,
after December 31, 1996, and early or retroactive  application is not permitted.
This  statement  is not  expected  to have a  material  effect on the  Company's
consolidated financial position or results of operations.

Legislative Matters

Recent Developments
-------------------
         On  December  31,  1996,  the  President  signed  into law the  Deposit
Insurance Funds Act of 1996(the "Funds Act") which, among other things,  imposes
a special one-time assessment on SAIF member  institutions,  including the Bank,
to  recapitalize  the SAIF.  As  required by the Funds Act,  the FDIC  imposed a
special  assessment  of 65.7 basis points on SAIF  assessable  deposits  held as
March 31, 1995 payable November 27, 1996. The special  assessment was recognized
as an  expense  in the  Company's  second  quarter  of  fiscal  1997  and is tax
deductible.  The Bank took a charge of $723,000 as a result of the FDIC  special
assessment.

         The Funds Act also spreads the obligations for payment of the Financing
Corporation("FICO") bonds across all SAIF and BIF members.  Beginning on January
1, 1997, BIF deposits will be assessed for FICO payments at a rate of 20% of the
rate  assessed on SAIF  deposits.  Based on current  estimates by the FDIC,  BIF
deposits  will be  assessed  a FICO  payment  of 1.3 basis  points,  while  SAIF
deposits will pay an estimated 6.5 basis points on the FICO bonds. Full pro rata
sharing of the FICO  payments  between  BIF and SAIF  members  will occur on the
earlier of January  1, 2000 or the date the BIF and SAIF are  merged.  The Funds
Act  specifies  that the BIF and SAIF will be merged on January 1, 1999 provided
no savings associations remain as of that time.

         As a result of the Funds Act, the FDIC recently  proposed to lower SAIF
assessments  to 0 to  27  basis  points  effective  January  1,  1997;  a  range
comparable to that of BIF members.  However,  SAIF members will continue to make
the higher FICO payments described above. Management cannot predict the level of
FDIC insurance  assessments on an on-going basis whether the savings association
charter  will be  eliminated  or  whether  the BIF and SAIF will  eventually  be
merged.

                                       23

<PAGE>


Average Balance Sheets for the Three Months Ended December 31,
1996 and 1995.

         The  following  table sets forth  certain  information  relating to the
consolidated  statements  of  financial  condition  and reflects  the yield on
average  assets and the average cost of liabilities for the periods  indicated.
The yields and costs include  amortization  of fees,  discounts,  and  premiums
which are considered adjustments to yield.

<TABLE>
<CAPTION>
                                                               Average Balance Sheets
                                                                   Yield Analysis

                                        Three Months Ended Dec. 31,               Three Months Ended Dec. 31,
                                      -------------------------------           -------------------------------
                                                   1996                                      1995
                                      -------------------------------           -------------------------------
                                                                Average                                Average
                                       Average                   Yield/        Average                  Yield/
                                    Balance(a)      Interest       Cost     Balance(a)     Interest       Cost
<S> <C>
Interest-earning assets:
  Loans, net                          $172,297        $3,771      8.75%       $157,315       $3,507      8.92%
  Mortgage-backed securities             9,405           159      6.76%         10,002          164      6.56%
  Interest earning deposits and
    federal funds sold                     970            12      4.95%          1,001           17      6.79%
  Securities                            10,099           161      6.38%          8,291          140      6.75%
                                     ---------     ---------  ---------      ---------    ---------  ---------
    Total interest-earning assets      192,771         4,103      8.51%        176,609        3,828      8.67%
Noninterest-earning assets (b)          14,470     ---------  ---------         11,277    ---------  ---------
                                     ---------                               ---------
    Total assets                      $207,241                                $187,886
                                      ========                                ========

Interest-bearing liabilities:
  Deposits                            $131,361       $ 1,474      4.49%       $121,380       $1,385      4.56%
  Borrowed Funds                        40,340           570      5.65%         35,294          558      6.32%
                                     ---------     ---------  ---------      ---------    ---------  ---------
    Total interest-bearing liabilities 171,701         2,044      4.76%        156,674        1,943      4.96%
Noninterest-bearing liabilities (c)     15,738     ---------  ---------         13,305    ---------  ---------
                                     ---------                               ---------
    Total liabilities                  187,439                                 169,979
Stockholders' equity                    19,802                                  17,907
                                     ---------                               ---------
    Total liabilities and equity      $207,241                                $187,886
                                     =========                               =========
Net interest income/Net rate spread                   $2,059      3.75%                      $1,885      3.71%
                                                   =========  =========                   =========   ========
Net interest-earning assets/net
  interest rate margin                 $21,070                    4.27%        $19,935                   4.27%
                                     =========                =========      =========                ========
Ratio of average interest-earning
  assets to average interest-bearing
  liabilities                           1.12 X                                  1.13 X
</TABLE>

(a) Average  balances, which are stated in  thousands,  are derived from average
    daily balances.

(b) Includes  average  investment in  life insurance  policies of $2,426,000 and
    $2,309,000  for the three  months  ended  December 31, 1996 and December 31,
    1995, respectively.  The Company realized non-interest income of $26,000 and
    $33,000  on it's  outstanding  investment  in these  policies  over the same
    respective time periods.
(c) Includes non-interest bearing deposit accounts.

                                       24

<PAGE>


Average Balance Sheets for the Nine Months Ended December 31,
1996 and 1995.

     The  following  table  sets  forth  certain  information  relating  to  the
consolidated statements of financial condition and reflects the yield on average
assets and the average cost of liabilities for the periods indicated. The yields
and costs  include  amortization  of fees,  discounts,  and  premiums  which are
considered adjustments to yield.

<TABLE>
<CAPTION>
                                                                Average Balance Sheets
                                                                    Yield Analysis

                                        Nine Months Ended Dec. 31,                Nine Months Ended Dec. 31,
                                      -------------------------------           -------------------------------
                                                   1996                                      1995
                                      -------------------------------           -------------------------------
                                                                Average                                Average
                                       Average                   Yield/        Average                  Yield/
                                    Balance(a)      Interest       Cost     Balance(a)     Interest       Cost
<S> <C>
Interest-earning assets:
  Loans, net                          $169,127       $11,089      8.74%       $142,558       $9,403      8.79%
  Mortgage-backed securities             9,626           484      6.70%         10,617          524      6.55%
  Interest earning deposits and
    federal funds sold                     591            22      4.96%          1,093           55      6.68%
  Securities                             9,393           447      6.35%          8,293          420      6.72%
                                     ---------     ---------  ---------      ---------    ---------  ---------
    Total interest-earning assets      188,737        12,042      8.51%        162,561       10,402      8.49%
Noninterest-earning assets (b)          12,149     ---------  ---------          9,093    ---------  ---------
                                     ---------                               ---------
    Total assets                      $200,886                                $171,654
                                     =========                               =========

Interest-bearing liabilities:
  Deposits                            $125,627       $ 4,154      4.41%       $114,175       $3,765      4.38%
  Borrowed Funds                        42,465         1,801      5.65%         29,023        1,369      6.26%
                                     ---------     ---------  ---------      ---------    ---------  ---------
    Total interest-bearing liabilities 168,092         5,955      4.72%        143,198        5,134      4.76%
Noninterest-bearing liabilities (c)     13,466     ---------  ---------         11,190    ---------  ---------
                                     ---------                               ---------
    Total liabilities                  181,558                                 154,388
Stockholders' equity                    19,328                                  17,266
                                     ---------                               ---------
    Total liabilities and equity      $200,886                                $171,654
                                     =========                               =========
Net interest income/ Net rate spread                  $6,087      3.78%                      $5,268      3.73%
                                                   =========  =========                   =========  =========
Net interest-earning assets/ net
  interest rate margin                 $20,645                    4.28%        $19,363                   4.30%
                                     =========                =========      =========               =========
Ratio of average interest-earning
  assets to average interest-bearing
  liabilities                           1.12 X                                  1.14 X
</TABLE>

(a) Average  balances, which are stated in  thousands,  are derived from average
    daily balances.
(b) Includes  average  investment in  life insurance  policies of $2,418,000 and
    $2,183,000 for the six months ended December 31, 1996 and December 31, 1995,
    respectively.  The  Company  realized  non-interest  income of  $79,000  and
    $101,000  on its  outstanding  investment  in these  policies  over the same
    respective time periods.
(c) Includes non-interest bearing deposit accounts.

                                       25

<PAGE>




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

Item 1.  Legal Proceedings.

The Company is not  involved in any legal  proceedings  of a material  nature at
this time other than those occurring in the ordinary course of business which in
the aggregate involves amounts which are believed by management to be immaterial
to the financial condition of the Company.

Item 2.  Changes in Securities.

                  None

Item 3.  Defaults upon Senior Securities.

                  None

Item 4.  Submission of Matters to a vote of Security Holders.

                  None

Item 5.           Other Information.

                  None

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

                  (a).     Exhibits

                           3.1  Certificate of Incorporation of CB Bancorp,
                                Inc.*
                           3.2  Bylaws of CB Bancorp, Inc.*

                           10.1 Amended and restated employee agreement
                                between CB Bancorp, Inc. and Joseph F.
                                Heffernan dated November 29, 1996.

                           27   Financial Data Schedule (filed herewith)

                           *Incorporated by reference to Registration  Statement
                           of Form S-1, as amended, filed on September 11, 1992,
                           registration Number 33-51882.

                  (b).     Reports on Form 8-K

                           None

                                       26

<PAGE>




                                CB-BANCORP, INC.



                                   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.


                                     CB Bancorp, Inc.


Dated: __________                    By: /s/  Joseph F. Heffernan
                                        ______________________________
                                        Joseph F. Heffernan
                                        President and Chief Executive
                                        Officer

Dated: __________                    By: /s/  George L. Koehm
                                        ______________________________
                                        George L. Koehm
                                        Vice President and Chief Financial
                                        Officer

Dated: __________                    By: /s/  Daniel R. Buresh
                                        ______________________________
                                        Daniel R. Buresh
                                        Vice President, Controller and
                                        Principal Accounting Officer


                                       27