<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

|X|      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

         For the quarterly period ended December 31, 2000

                                       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 0-20006


                          ANCHOR BANCORP WISCONSIN INC.
                          -----------------------------
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)





              Wisconsin                                  39-1726871
            -------------                                ----------
   (State or other jurisdiction of            (IRS Employer Identification No.)
   incorporation or organization)

         25 West Main Street
         Madison, Wisconsin                                53703
       ----------------------                           -----------
(Address of principal executive office)                  (Zip Code)




                                 (608) 252-8700
                    -----------------------------------------
               Registrant's telephone number, including area code

                                 Not Applicable
                    -----------------------------------------
  (Former name, former address, and former fiscal year, if changed since last
                                    report)

Indicate by check mark whether the registrant (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.

Yes |X|     No | |

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

                      Class: Common stock -- $.10 Par Value


         Number of shares outstanding as of January 31, 2001: 22,923,983



<PAGE>   2



                          ANCHOR BANCORP WISCONSIN INC.
                                INDEX - FORM 10-Q

<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION                                                                            PAGE #
                                                                                                          ------
<S>                                                                                                       <C>

         Item 1       Financial Statements (Unaudited)

                              Consolidated Balance Sheets as of December 31, 2000
                              and March 31, 2000                                                              2

                              Consolidated Statements of Income for the Three and Nine
                              Months Ended December 31, 2000 and 1999                                         3

                              Consolidated Statements of Cash Flows for the Nine Months
                              Ended December 31, 2000 and 1999                                                4

                              Notes to Unaudited Consolidated Financial Statements                            6

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

                              Results of Operations                                                          10

                              Financial Condition                                                            15

                              Asset Quality                                                                  16

                              Liquidity & Capital Resources                                                  18

                              Asset/Liability Management                                                     20

         Item 3       Quantitative and Qualitative Disclosures About Market Risk                             21


PART II - OTHER INFORMATION

         Item 1       Legal Proceedings                                                                      21
         Item 2       Changes in Securities                                                                  21
         Item 3       Defaults upon Senior Securities                                                        21
         Item 4       Submission of Matters to Vote of Security Holders                                      21
         Item 5       Other Information                                                                      21
         Item 6       Exhibits and Reports on Form 8-K                                                       21

SIGNATURES                                                                                                   22
</TABLE>



                                       1

<PAGE>   3


                           CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                        DECEMBER 31,                MARCH 31,
                                                                                            2000                       2000
                                                                                        ---------------------------------------
                                                                                                    (In Thousands)
<S>                                                                                     <C>                      <C>
ASSETS
Cash                                                                                    $     49,832              $     46,560
Interest-bearing deposits                                                                     64,367                    37,148
                                                                                        ------------              ------------
  Cash and cash equivalents                                                                  114,199                    83,708
Investment securities available for sale                                                      20,491                    34,936
Investment securities held to maturity (fair value of $49,263  and
  $49,971, respectively)                                                                      49,580                    51,270
Mortgage-related securities available for sale                                               183,610                    57,276
Mortgage-related securities held to maturity (fair value of $210,899
  and $234,505, respectively)                                                                212,297                   243,243
Loans receivable, net:
  Held for sale                                                                                8,126                     1,764
  Held for investment                                                                      2,384,497                 2,302,721
Foreclosed properties and repossessed assets, net                                                292                       272
Real estate held for development and sale                                                     48,876                    34,063
Office properties and equipment                                                               25,666                    25,712
Federal Home Loan Bank stock--at cost                                                         37,236                    34,597
Accrued interest on investments and loans                                                     22,035                    19,364
Prepaid expenses and other assets                                                             30,764                    22,226
                                                                                        ------------              ------------
     Total assets                                                                       $  3,137,669              $  2,911,152
                                                                                        ============              ============

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits                                                                                $  2,067,805              $  1,897,369
Federal Home Loan Bank and other borrowings                                                  734,987                   664,446
Reverse repurchase agreements                                                                 46,035                    92,413
Advance payments by borrowers for taxes and insurance                                            637                     8,213
Other liabilities                                                                             74,832                    31,496
                                                                                        ------------              ------------
     Total liabilities                                                                     2,924,296                 2,693,937
                                                                                        ============              ============
Preferred stock, $.10 par value, 5,000,000 shares
 authorized, none outstanding                                                                      -                         -
Common stock, $.10 par value, 100,000,000 shares authorized,
 25,363,339 shares issued, 22,914,504 and 24,088,147 shares outstanding,
 respectively                                                                                  2,536                     2,536
Additional paid-in capital                                                                    56,548                    56,496
Retained earnings                                                                            192,612                   179,211
Less:   Treasury stock (2,448,835 shares and 1,275,192 shares,
               respectively), at cost                                                        (36,969)                  (18,438)
        Common stock purchased by benefit plans                                                 (709)                     (923)
        Accumulated other comprehensive loss                                                    (645)                   (1,667)
                                                                                        ------------              ------------
     Total stockholders' equity                                                              213,373                   217,215
                                                                                        ------------              ------------
     Total liabilities and stockholders' equity                                         $  3,137,669              $  2,911,152
                                                                                        ============              ============
</TABLE>


See accompanying Notes to Unaudited Consolidated Financial Statements.



                                       2

<PAGE>   4
                        Consolidated Statements of Income
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                  THREE MONTHS ENDED            NINE MONTHS ENDED
                                                                      DECEMBER 31,                 DECEMBER 31,
                                                               ------------------------   ------------------------------
                                                                  2000          1999           2000              1999
                                                               ------------------------   ------------------------------
                                                                             (In Thousands, Except Per Share Data)
<S>                                                            <C>           <C>          <C>                  <C>
INTEREST INCOME:
Loans                                                           $ 51,416     $ 45,154         $148,621         $ 131,266
Mortgage-related securities                                        4,405        3,839           13,722            11,858
Investment securities                                              2,363        2,399            6,490             6,417
Interest-bearing deposits                                            756          392            1,451               889
                                                                 -------      -------          -------           -------
  Total interest income                                           58,940       51,784          170,284           150,430

Interest expense:
Deposits                                                          26,319       20,392           71,625            60,422
Notes payable and other borrowings                                12,660       10,130           38,004            26,602
Other                                                                185          205              463               513
                                                                 -------      -------          -------           -------
  Total interest expense                                          39,164       30,727          110,092            87,537
                                                                 -------      -------          -------           -------
  Net interest income                                             19,776       21,057           60,192            62,893
Provision for loan losses                                            150          150              495             1,156
                                                                 -------      -------          -------           -------
  Net interest income after provision for loan losses             19,626       20,907           59,697            61,737

NON-INTEREST INCOME:
Loan servicing income                                                673          556            1,910             1,743
Service charges on deposit accounts                                1,512        1,269            4,350             3,845
Insurance commissions                                                436          400            1,444               899
Gain on sale of loans                                                609          433            2,177             1,828
Net gain (loss) on sale of investments and securities                 33          (13)             115                (8)
Net income (loss) from operations of real estate investment         (761)         (42)          (1,375)              410
Other                                                                576          525            1,392             1,511
                                                                 -------      -------          -------           -------
  Total non-interest income                                        3,078        3,128           10,013            10,228

NON-INTEREST EXPENSE:
Compensation                                                       7,210        6,737           21,325            20,139
Occupancy                                                          1,112        1,166            3,199             3,187
Federal insurance premiums                                            97          275              289               807
Furniture and equipment                                              942          995            2,898             2,796
Data processing                                                      923          873            2,783             2,692
Marketing                                                            431          626            1,649             1,911
Merger-related                                                         -            -                -             8,500
Goodwill                                                               -            -                -             1,761
Other                                                              2,177        2,388            6,281             6,679
                                                                 -------      -------          -------           -------
  Total non-interest expense                                      12,892       13,060           38,424            48,472
                                                                 -------      -------          -------           -------
  Income before income taxes                                       9,812       10,975           31,286            23,493

Income taxes                                                       3,345        4,183           11,253            11,182
                                                                 -------      -------          -------           -------
  Net income                                                    $  6,467     $  6,792         $ 20,033         $  12,311
                                                                 =======      =======          =======           =======

EARNINGS PER SHARE:
  Basic                                                         $   0.29       $ 0.28         $   0.88         $    0.50
  Diluted                                                           0.28         0.27             0.86              0.48
Dividends declared per share                                        0.08         0.07             0.22              0.18

</TABLE>

See accompanying Notes to Unaudited Consolidated Financial Statements.


                                       3

<PAGE>   5
                      Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                          Nine Months Ended December 31,
                                                                     -----------------------------------------
                                                                           2000                   1999
                                                                     -----------------------------------------
                                                                                 (In Thousands)
<S>                                                                  <C>                         <C>
Operating Activities
 Net income                                                                    $ 20,033             $ 12,311
 Adjustments to reconcile net income to net
  cash provided by operating activities:
 Provision for losses on loans and real estate                                      495                1,156
 Provision for depreciation and amortization                                      1,609                2,722
 Net gain on sales of loans                                                      (2,177)              (1,828)
 Increase in accrued interest receivable                                         (2,671)              (1,362)
 Increase in accrued interest payable                                             2,989                1,226
 Increase in accounts payable                                                    42,252                  735
 Other                                                                           (7,602)              13,562
                                                                                --------             --------
 Net cash provided by operating activities before proceeds
  from loan sales                                                                54,928               28,522
 Net proceeds from origination and sale of loans held for sale                  120,998              (27,517)
                                                                                --------             --------
  Net cash provided by operating activities                                     175,926                1,005

Investing Activities
 Proceeds from sales of investment securities available for sale                 26,230               38,429
 Proceeds from maturities of investment securities                               52,499               60,696
 Purchase of investment securities available for sale                           (65,323)             (80,188)
 Purchase of investment securities held to maturity                                   -              (11,000)
 Proceeds from sale of mortgage-related securities available for sale             4,071                   (2)
 Purchase of mortgage-related securities held to maturity                             -               (8,851)
 Purchase of mortgage-related securities available for sale                    (133,378)             (14,999)
 Principal collected on mortgage-related securities                              35,236               45,400
 Loans originated for investment                                               (439,938)            (637,861)
 Principal repayments on loans                                                  228,932              454,145
 Net office properties and equipment                                                (46)              (1,006)
 Sales of real estate                                                               312                5,009
 Purchase of real estate held for development and sale                          (15,863)              (5,957)
                                                                                --------             --------
  Net cash used by investing activities                                        (307,268)            (156,185)
</TABLE>



                                       4

<PAGE>   6
                 Consolidated Statements of Cash Flows (Cont'd)
<TABLE>
<CAPTION>
                                                                          Nine Months Ended December 31,
                                                                      -------------------------------------
                                                                            2000                 1999
                                                                      -------------------------------------
                                                                               (In Thousands)
<S>                                                                 <C>                      <C>
Financing Activities
 Increase in deposit accounts                                            $  170,436          $     9,205
 Decrease in advance payments by borrowers
   for taxes and insurance                                                   (7,576)              (9,269)
 Proceeds from notes payable to Federal Home Loan Bank                      767,800            1,058,550
 Repayment of notes payable to Federal Home Loan Bank                      (721,800)            (893,300)
 Increase (decrease) in securities sold under agreements
  to repurchase                                                             (46,378)               5,152
 Increase (decrease) in other loans payable                                  24,540               (4,400)
 Treasury stock purchased                                                   (22,046)              (9,233)
 Reissuance of treasury stock for options                                       831                4,419
 Purchase of stock by retirement plans                                        1,174                  541
 Payments of cash dividends to stockholders                                  (5,148)              (4,194)
                                                                         -----------          -----------
   Net cash provided by financing activities                                161,833              157,471
                                                                         -----------          -----------
   Net increase in cash and cash equivalents                                 30,491                2,291
 Cash and cash equivalents at beginning of year                              83,708               63,976
                                                                         -----------          -----------
   Cash and cash equivalents at end of year                              $  114,199           $   66,267
                                                                         ===========          ===========

Supplementary cash flow information:
Cash paid or credited to accounts:
  Interest on deposits and borrowings                                    $  113,081             $ 63,743
  Income taxes                                                               10,917                8,695
Non-cash transactions:
 Retirement of treasury stock                                                     -               28,563
 Securitization of mortgage loans held for sale to mortgage-backed
   securities                                                               128,456                    -
</TABLE>


 See accompanying Notes to Unaudited Consolidated Financial Statements


                                       5

<PAGE>   7

                          ANCHOR BANCORP WISCONSIN INC.
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1 - PRINCIPLES OF CONSOLIDATION

The unaudited consolidated financial statements include the accounts and results
of operations of Anchor BanCorp Wisconsin Inc. (the "Corporation") and its
wholly-owned subsidiaries, AnchorBank fsb (the "Bank"), Investment Directions,
Inc. ("IDI") Nevada Investment Directions, Inc. ("NIDI") and California
Investment Directions, Inc. ("CIDI"). The Bank's accounts and results of
operations include its wholly-owned subsidiaries, Anchor Investment Services,
Inc. ("AIS"), ADPC Corporation ("ADPC"), and Anchor Investment Corporation
("AIC"). All significant intercompany balances and transactions have been
eliminated. Investments in joint ventures and other less than 50% owned
partnerships, which are not material, are accounted for by the equity method.
Partnerships with 50% ownership or more are consolidated, with significant
intercompany accounts eliminated.


NOTE 2 - BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles ("GAAP") and with
the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly,
they do not include all of the information and footnotes required by GAAP for
complete financial statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) necessary for a fair presentation of
the consolidated financial statements have been included.


In preparing the unaudited consolidated financial statements in conformity with
GAAP, management is required to make estimates and assumptions that affect the
amounts reported in the consolidated financial statements and accompanying
notes. Actual results could differ from those estimates. The results of
operations and other data for the nine-month period ended December 31, 2000 are
not necessarily indicative of results that may be expected for any other interim
period or the entire fiscal year ending March 31, 2001. The unaudited
consolidated financial statements presented herein should be read in conjunction
with the audited consolidated financial statements and related notes thereto
included in the Corporation's Annual Report for the year ended March 31, 2000.

Unrealized gains or losses on the Corporation's available-for-sale securities
are included in other comprehensive income. During the quarter ended December
31, 2000 and 1999, total comprehensive income amounted to $6.9 million and $6.2
million, respectively. For the nine months ended December 31, 2000 and 1999,
comprehensive income was $21.1 million and $10.6 million, respectively.

NEW ACCOUNTING STANDARDS In June 1999, the Financial Accounting Standards Board
("FASB") issued SFAS No. 137 to effectively defer the implementation date of
SFAS No. 133 "Accounting for Derivative Instruments and Hedging Activities" for
one year. SFAS No. 133 was issued in June 1998 and establishes, for the first
time, comprehensive accounting and reporting standards for derivative
instruments and hedging activities. This new standard requires that all
derivative instruments be recorded in the statement of condition at fair value.
The recording of the gain or loss due to changes in fair value could either be
reported in earnings or as other comprehensive income in the statement of
shareholders' equity, depending on the type of instrument and whether or not it
is considered a hedge. With the issuance of SFAS No. 137, SFAS No. 133 is now
effective April 1, 2001. The adoption of this new statement is currently not
expected to have a material effect on the Corporation's future financial
condition, results of operations, or liquidity.

SEGMENT REPORTING Operating segments are components of a business about which
separate financial information is available and that are evaluated regularly by
the chief operating decision maker in deciding how to allocate resources and
assessing performance. Public companies are required to report certain financial
information about operating segments in interim and annual financial statements
if such segments meet quantitative thresholds for


                                       6

<PAGE>   8

reporting segment information. The Corporation's only operating segment that
meets materiality thresholds is the community banking operation. As such,
separate segment disclosures are not required.

Certain 1999 accounts have been reclassified to conform to the 2000
presentations.

NOTE 3 - STOCKHOLDERS' EQUITY

During the quarter ended December 31, 2000, options for 56,962 shares of common
stock were exercised at a weighted-average price of $5.85 per share. Treasury
shares were issued in exchange for the options using the last-in-first-out
method. The cost of the treasury shares issued in excess of the option price
paid was charged to retained earnings $(590,000). During the quarter ended
December 31, 2000, the Corporation repurchased 155,500 shares of common stock.
During the quarter, 15,368 shares of treasury stock were reissued to the
Corporation's retirement plans. The weighted-average cost of these shares was
$15.56 per share or $232,000 in the aggregate and the excess of the market price
over cost of the treasury shares $(8,000) was charged to retained earnings. On
November 15, 2000, the Corporation paid a cash dividend of $0.075 per share
amounting to $1.7 million.


NOTE 4 - EARNINGS PER SHARE

Earnings per share for the three and nine months ended December 31, 2000 and
1999 have been determined by dividing net income for the respective periods by
the weighted average number of shares of common stock and common stock
equivalents outstanding. Common stock equivalents are computed using the
treasury stock method.


                                       7


<PAGE>   9
<TABLE>
<CAPTION>
                                                             THREE MONTHS ENDED DECEMBER 31,
                                                     ------------------------------------------------
                                                           2000                           1999
                                                     ------------------------------------------------
<S>                                                  <C>                              <C>
Numerator:
      Net income                                          $ 6,466,721                    $ 6,792,371
                                                      -----------------               ----------------
      Numerator for basic and diluted earnings
        per share--income available to common
        stockholders                                      $ 6,466,721                    $ 6,792,371

Denominator:
     Denominator for basic earnings per
        share--weighted-average shares                     22,410,597                     24,432,845
      Effect of dilutive securities:
        Employee stock options                                511,528                        730,290
      Denominator for diluted earnings per
        share--adjusted weighted-average              -----------------               ----------------
        shares and assumed conversions                     22,922,125                     25,163,135
                                                      -----------------               ----------------
Basic earnings per share                                  $      0.29                    $      0.28
                                                      -----------------               ----------------
Diluted earnings per share                                $      0.28                    $      0.27
                                                      -----------------               ----------------
</TABLE>
<TABLE>
<CAPTION>
                                                             Nine Months Ended December 31,
                                                     ------------------------------------------------
                                                           2000                           1999
                                                     ------------------------------------------------
<S>                                                  <C>                               <C>
Numerator:
      Net income                                        $  20,033,032                  $  12,310,970
                                                     -----------------               ----------------
      Numerator for basic and diluted earnings
        per share--income available to common
        stockholders                                    $  20,033,032                  $  12,310,970

Denominator:
      Denominator for basic earnings per
        share--weighted-average shares                     22,781,036                     24,549,435
      Effect of dilutive securities:
        Employee stock options                                576,526                        859,720
      Denominator for diluted earnings per
        share--adjusted weighted-average             -----------------               ----------------
        shares and assumed conversions                     23,357,562                     25,409,155
                                                     -----------------               ----------------
Basic earnings per share                                $        0.88                  $        0.50
                                                     -----------------               ----------------
Diluted earnings per share                              $        0.86                  $        0.48
                                                     -----------------               ----------------
</TABLE>


                                       8

<PAGE>   10

NOTE 5 - SUBSEQUENT EVENTS

On January 19, 2001, the Corporation declared a $0.075 per share cash dividend
on its common stock to be paid on February 15, 2001 to stockholders of record on
February 1, 2001.



















                                       9

<PAGE>   11
                          ANCHOR BANCORP WISCONSIN INC.

    ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                             RESULTS OF OPERATIONS

This report contains certain "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. The Corporation desires to take
advantage of the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995 and is including this statement for the expressed purpose of
availing itself of the protection of the safe harbor with respect to all of such
forward-looking statements. These forward-looking statements describe future
plans or strategies and include the Corporation's expectations of future
financial results. The Corporation's ability to predict results or the effect of
future plans or strategies is inherently uncertain and the Corporation can give
no assurance that those results or expectations will be attained. Factors that
could affect actual results include but are not limited to i) general market
rates, ii) changes in market interest rates and the shape of the yield curve,
iii) general economic conditions, iv) real estate markets, v)
legislative/regulatory changes, vi) monetary and fiscal policies of the U.S.
Treasury and the Federal Reserve, vii) changes in the quality or composition of
the Corporation's loan and investment portfolios, viii) demand for loan
products, ix) the level of loan and MBS repayments, x) deposit flows, xi)
competition, xii) demand for financial services in the Corporation's markets,
and xiii) changes in accounting principles, policies or guidelines. These
factors should be considered in evaluating the forward-looking statements, and
undue reliance should not be placed on such statements.


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

The following discussion is designed to provide a more thorough discussion of
the Corporation's financial condition and results of operations as well as to
provide additional information on the Corporation's asset/liability management
strategies, sources of liquidity and capital resources. Management's discussion
and analysis should be read in conjunction with the consolidated financial
statements and supplemental data contained elsewhere in this report.

RESULTS OF OPERATIONS

General. Net income for the three and nine months ended December 31, 2000
decreased $330,000 to $6.5 million and increased $7.7 million to $20.0 million,
respectively, from the same periods in the prior year. The decrease in net
income for the three-month period compared to the same period last year was
largely due to the increase in interest expense of $8.4 million. In addition,
non-interest income for the three months ended December 31, 2000 decreased
$50,000. These decreases were offset by an increase in interest income of $7.2
million, a decrease in non-interest expense of $170,000 and a decrease in income
tax expense of $840,000 for the three-month period. The increase in net income
for the nine-month period compared to the same period last year was largely due
to the decrease in non-interest expense of $10.0 million, primarily due to prior
year merger-related expenses of $8.5 million in connection with the acquisition
of FCB Financial Corp. (FCBF) and the write off of goodwill of $1.8 million from
a previous acquisition that had become impaired. An increase in interest income
of $19.9 million, and a decrease in provision for loan losses of $660,000 also
contributed to the increase in net income for the nine-month period. The
decrease in loss provision was due to an adjustment made in the prior nine-month
period due to the merger with FCBF. These income increases, for the nine months
ended December 31, 2000, were offset by an increase in interest expense of $22.6
million, a decrease in non-interest income of $220,000, and an increase in
income taxes of $70,000.

Net Interest Income. Net interest income decreased $1.3 million and $2.7 million
for the three and nine months ended December 31, 2000 compared to the same
periods in 1999. The net interest margin decreased to 2.68% from 3.05% for the
respective three-month periods and decreased to 2.80% from 3.14% for the
respective nine-month periods. The interest rate spread decreased to 2.48% from
2.73% and decreased to 2.61% from 2.86%, respectively, for the same periods.


                                       10


<PAGE>   12

Interest income on loans increased $6.3 million and $17.4 million for the three
and nine months ended December 31, 2000 as compared to the same periods in the
prior year. These increases were the result of an increase of $161.9 million and
$173.5 million, respectively, in the average balance of loans for the periods
due to increased loan originations. Interest income on mortgage-related
securities increased $570,000 and $1.9 million for the same periods due
primarily to the increase of $33.6 million and $38.1 million, respectively, in
the average balance of mortgage-related securities. Interest income on
investment securities (including Federal Home Loan Bank stock) decreased $40,000
and increased $70,000 for the three- and nine-month periods ended December 31,
2000 as compared to the same periods in the prior year. Although the average
balances of the investment securities and FHLB stock decreased $19.6 million and
$17.4 million, respectively, for the three-and nine-month periods, these
decreases were offset by an increase in the average yield from 5.37% to 5.93%
for the three-month period, and from 5.31% to 5.85% for the nine-month period
for investment securities. The average yield for FHLB stock increased from 7.49%
to 8.05% and from 6.50% to 7.66% for the respective three and nine months ended
December 31, 2000 as compared to the same periods in the prior year. Interest
income on interest-bearing deposits increased $360,000 and $560,000,
respectively, for the three and nine months ended December 31, 2000, due to the
increase of $17.5 million and $6.3 million in the average balance of
interest-bearing deposits.

Interest expense on deposits increased $5.9 million and $11.2 million,
respectively, for the three and nine months ended December 31, 2000 as compared
to the same periods in 1999. These increases were due primarily to the increases
in the average balance of deposits of $196.4 million and $115.2 million,
respectively, for the three- and nine-month periods, as a result of various
demand deposit and certificate promotions. Interest expense on notes payable and
other borrowings increased $2.5 million and $11.4 million, respectively, during
the same periods due to an increase of $75.5 million and $146.9 million,
respectively, in the average balance of notes payable and other borrowings.
Other interest expense decreased $20,000 and $50,000, respectively, for the
three and nine months ended December 31, 2000.

Provision for Loan Losses. Provision for loan losses remained constant for the
three-month period and decreased $660,000 to $500,000 for the nine-month period
ended December 31, 2000 compared to the same periods for the prior year. The
nine-month period decrease included a $650,000 conforming adjustment in fiscal
2000 to bring FCBF's allowance in conformity with the Corporation's allowance
policy. Exclusive of this one-time conforming provision, provision for loan
losses for the nine-month period would have decreased $10,000 to $500,000. The
provision was based on management's ongoing evaluation of asset quality.

Average Interest-Earning Assets, Average Interest-Bearing Liabilities and
Interest Rate Spread. The following tables show the Corporation's average
balances, interest, average rates, net interest margin and the spread between
the combined average rates earned on interest-earning assets and average cost of
interest-bearing liabilities for the periods indicated. The average balances are
derived from average daily balances.





                                       11


<PAGE>   13
<TABLE>
<CAPTION>
                                                                  Three Months Ended December 31,
                                            ----------------------------------------------------------------------------
                                                            2000                                   1999
                                            ------------------------------------   -------------------------------------
                                                                       Average                                 Average
                                               Average                  Yield/         Average                  Yield/
                                               Balance      Interest     Cost (1)      Balance     Interest     Cost (1)
                                            ----------------------------------------------------------------------------
                                                                      (Dollars In Thousands)
<S>                                         <C>           <C>          <C>           <C>          <C>          <C>
INTEREST-EARNING ASSETS
Mortgage loans (2)                           $1,933,406   $   38,899      8.05%      $1,840,236   $   34,689      7.54%
Consumer loans (2)                              473,215       10,617      8.97          424,673        9,167      8.63
Commercial business loans(2)                     77,754        1,900      9.77           57,599        1,298      9.01
                                             ----------   ----------                 ----------   ----------
  Total loans receivable (2)                  2,484,375       51,416      8.28        2,322,508       45,154      7.78
Mortgage-related securities                     275,586        4,405      6.39          242,013        3,839      6.35
Investment securities (3)                       108,911        1,614      5.93          132,856        1,784      5.37
Interest-bearing deposits                        48,017          756      6.30           30,501          392      5.14
Federal Home Loan Bank stock                     37,199          749      8.05           32,846          615      7.49
                                             ----------   ----------                 ----------   ----------
  Total interest-earning assets               2,954,088       58,940      7.98        2,760,724       51,784      7.50
Non-interest-earning assets                     159,793                   ----           87,313                   ----
                                             ----------                              ----------
  Total assets                               $3,113,881                              $2,848,037
                                             ==========                              ==========

INTEREST-BEARING LIABILITIES
Demand deposits                              $  569,510        4,770      3.35       $  608,729        3,973      2.61
Regular passbook savings                        133,560          569      1.70           82,274          552      2.68
Certificates of deposit                       1,342,278       20,980      6.25        1,157,992       15,867      5.48
                                             ----------   ----------                 ----------   ----------
  Total deposits                              2,045,348       26,319      5.15        1,848,995       20,392      4.41
Notes payable and other borrowings              781,949       12,660      6.48          706,447       10,130      5.74
Other                                            21,227          185      3.49           21,628          205      3.79
                                             ----------   ----------                 ----------   ----------
  Total interest-bearing liabilities          2,848,524       39,164      5.50        2,577,070       30,727      4.77
                                                          ----------      ----                    ----------      ----
Non-interest-bearing liabilities                 52,565                                  45,196
                                             ----------                              ----------
  Total liabilities                           2,901,089                               2,622,266
Stockholders' equity                            212,792                                 225,771
                                             ----------                              ----------
  Total liabilities and stockholders' equity $3,113,881                              $2,848,037
                                             ==========                              ==========
  Net interest income/interest rate spread                $   19,776     2.48%                     $  21,057      2.73%
                                                          ----------     -----                    ----------      -----
  Net interest-earning assets                $  105,564                             $   183,654
                                             ----------                              ----------
  Net interest margin                                                    2.68%                                    3.05%
                                                                         -----                                    -----
  Ratio of average interest-earning assets
   to average interest-bearing liabilities         1.04                                    1.07
                                                   ----                                    ----
</TABLE>
--------------------------------------------

(1)  Annualized
(2)  The average balances of loans include non-performing loans, interest of
     which is recognized on a cash basis.
(3)  The interest on available for sale securities is calculated based on
     amortized historic cost.



                                       12


<PAGE>   14
<TABLE>
<CAPTION>
                                                                   Nine Months Ended December 31,
                                            ----------------------------------------------------------------------------
                                                            2000                                   1999
                                            ------------------------------------   -------------------------------------
                                                                       Average                                 Average
                                               Average                  Yield/         Average                  Yield/
                                               Balance      Interest     Cost (1)      Balance     Interest     Cost (1)
                                            ----------------------------------------------------------------------------
                                                                      (Dollars In Thousands)
<S>                                          <C>           <C>         <C>            <C>          <C>         <C>
INTEREST-EARNING ASSETS
Mortgage loans (2)                            $1,886,010   $  112,522       7.95%     $1,764,699   $  100,187      7.57%
Consumer loans (2)                               461,473       30,792       8.90         412,323       26,649      8.62
Commercial business loans(2)                      70,767        5,307      10.00          67,682        4,430      8.73
                                              ----------   ----------                 ----------   ----------
  Total loans receivable (2)                   2,418,250      148,621       8.19       2,244,704      131,266      7.80
Mortgage-related securities                      285,048       13,722       6.42         246,939       11,858      6.40
Investment securities (3)                        100,638        4,418       5.85         122,819        4,891      5.31
Interest-bearing deposits                         30,751        1,451       6.29          24,497          889      4.84
Federal Home Loan Bank stock                      36,078        2,072       7.66          31,322        1,526      6.50
                                              ----------   ----------                 ----------   ----------
  Total interest-earning assets                2,870,765      170,284       7.91       2,670,281      150,430      7.51
Non-interest-earning assets                      155,923                    ----          95,878                   ----
                                              ----------                              ----------
  Total assets                                $3,026,688                              $2,766,159
                                              ==========                              ==========
INTEREST-BEARING LIABILITIES
Demand deposits                               $  571,151       14,235       3.32      $  558,869       11,185      2.67
Regular passbook savings                         137,441        1,708       1.66         188,604        3,869      2.74
Certificates of deposit                        1,238,712       55,682       5.99       1,084,621       45,368      5.58
                                              ----------   ----------                 ----------   ----------
  Total deposits                               1,947,304       71,625       4.90       1,832,094       60,422      4.40
Notes payable and other borrowings               806,265       38,004       6.28         659,414       26,602      5.38
Other                                             17,877          463       3.45          18,307          513      3.74
                                              ----------   ----------                 ----------   ----------
  Total interest-bearing liabilities           2,771,446      110,092       5.30       2,509,815       87,537      4.65
                                                           ----------       ----                   ----------      ----
Non-interest-bearing liabilities                  42,881                                  32,514
                                              ----------                              ----------
  Total liabilities                            2,814,327                               2,542,329
Stockholders' equity                             212,361                                 223,830
                                              ----------                              ----------
  Total liabilities and stockholders' equity  $3,026,688                              $2,766,159
                                              ==========                              ==========
  Net interest income/interest rate spread                 $   60,192       2.61%                  $   62,893      2.86%
                                                           ----------       ----                   ----------      ----
  Net interest-earning assets                 $   99,319                              $  160,466
                                              ----------                              ----------
  Net interest margin                                                       2.80%                                  3.14%
                                                                            ----                                   ----
  Ratio of average interest-earning assets
   to average interest-bearing liabilities          1.04                                    1.06
                                                    ----                                    ----
</TABLE>
--------------------------------------------
(1)  Annualized

(2)  The average balances of loans include non-performing loans, interest of
     which is recognized on a cash basis.

(3)  The interest on available for sale securities is calculated based on
     amortized historic cost.





                                       13

<PAGE>   15

Non-Interest Income. Non-interest income decreased $50,000 to $3.1 million and
$220,000 to $10.0 million, respectively, for the three and nine months ended
December 31, 2000 as compared to the same periods in the prior year primarily
due to a decrease in net income from operations of real estate investments of
$720,000 and $1.8 million. These decreases were largely due to decreased resort
and golf net income at the partnerships and losses on the sale of three
condominium units in a development in Bloomington, Minnesota. Other non-interest
income, which includes a variety of loan fee and other miscellaneous fee income,
increased $50,000 and decreased $120,000 for the three- and nine-month periods.
Accompanying these changes were increases in several items. Service charges on
deposit accounts increased $240,000 and $510,000 for the three- and nine-month
periods due to a growth in deposits and increased fees. Insurance commissions
increased $40,000 and $550,000 for the three and nine months ended December 31,
2000 as compared to the same periods in the prior year due to increased sales.
The gain on sale of loans increased $180,000 and $350,000 for the three- and
nine-month periods due to increased gain on student loan sales. In addition,
loan servicing income increased $120,000 and $170,000 for the three and nine
months ended December 31, 2000 as compared to the same periods in the prior year
largely due to an increase in the volume of serviced loans. Net gain on sale of
investments and securities increased $50,000 and $120,000 for the three- and
nine- month periods ended December 31, 2000.

Non-Interest Expense. Non-interest expense decreased $170,000 to $12.9 million
and decreased $10.0 million to $38.4 million, respectively, during the three and
nine months ended December 31, 2000 as compared to the same periods in 1999 as a
result of several factors. The decrease in non-interest expense for the
three-month period ended December 31, 2000 as compared to the same period in the
prior year was due in part to a decrease in other expense of $210,000. Marketing
expense decreased $200,000 for the three months ended December 31, 2000. Federal
insurance premiums decreased $180,000 for the three-month period due to a
reduction in the assessment. Occupancy expense decreased $50,000 due to
decreased real estate taxes and assessment expense for the three months ended
December 31, 2000. Furniture and equipment expense decreased $50,000 for the
three-month period ended December 31, 2000 as compared to the same period in
1999. These decreases were partially offset by an increase in compensation
expense of $470,000 for the three months ended December 31, 2000 due primarily
to an increase in incentive compensation resulting from increased loan
production. In addition, data processing expense increased $50,000 as compared
to the same period in the prior year.

 The decrease in non-interest expense for the nine-month period ended December
31, 2000 was attributable to merger-related expense of $8.5 million in the first
quarter of fiscal 2000 due to the merger with FCBF and increased goodwill
expense of $1.8 million also in the first quarter of fiscal 2000. Unamortized
goodwill from a previous merger became impaired and was written off in the first
quarter of fiscal 2000. Exclusive of the one-time charges for the merger and
goodwill, non-interest expense increased $210,000 for the nine-month period
ended December 31, 2000 as compared to the same period in the prior year. This
increase was primarily due to an increase in compensation expense of $1.2
million largely due to an increase in incentive compensation resulting from
increased loan production. Furniture and equipment expense increased $100,000
for the nine-month period ended December 31, 2000. Additionally, data processing
expense increased $90,000, and occupancy expense increased $10,000 for the same
nine-month period as compared to the same period in the prior year. Partially
offsetting these increases was a decrease of $520,000 in federal insurance
premiums due to a reduction in the assessment, and a decrease of $400,000 in
other non-interest expense largely due to decreased postage expense for the nine
months ended December 2000. In addition, marketing expense decreased $260,000 as
compared to the prior nine-month period.

Income Taxes. Income tax expense decreased $840,000 and increased $70,000 during
the three and nine months ended December 31, 2000 as compared to the same
periods in 1999. The effective tax rate was 34.1% and 36.0%, respectively, for
the current year as compared to 38.1% and 47.6% for the three- and nine-month
periods last year. The unusual effective tax rate for the nine-month period for
1999 was a result of certain merger-related costs and goodwill amortization that
are not deductible for tax purposes.




                                       14


<PAGE>   16
FINANCIAL CONDITION


During the nine months ended December 31, 2000, the Corporation's assets
increased by $226.5 million from $2.91 billion at March 31, 2000, to $3.14
billion. The majority of this increase was attributable to increases in
mortgage-related securities and loans was partially offset by decreases in
investment securities.

Investment securities (both available for sale and held to maturity) decreased
$16.1 million during the nine months ended December 31, 2000 as a result of
sales and maturities of $81.4 million of U.S. Government and agency securities
which were offset by purchases of $65.3 million.

Mortgage-related securities (both available for sale and held to maturity)
increased $95.4 million during the nine months ended December 31, 2000 as a
result of purchases of $133.4 million. This increase was partially offset by
principal repayments and market value adjustments of $33.9 million and sales of
$4.1 million. Mortgage-related securities consisted of $363.0 million of
mortgage-backed securities and $32.9 million of Collateralized Mortgage
Obligations ("CMO's") and Real Estate Mortgage Investment Conduits ("REMIC's")
at December 31, 2000.

The Corporation's investments in CMO's and REMIC's are limited to federal agency
issued REMIC's which represent an interest in mortgage-backed securities. These
investments are deemed to have limited credit risk. The investments do have
interest rate risk due to, among other things, actual prepayments being more or
less than those predicted at the time of purchase. The Corporation invests only
in short-term tranches in order to limit the reinvestment risk associated with
greater than anticipated prepayments, as well as changes in value resulting from
changes in interest rates.

Total loans (including loans held for sale) increased $88.1 million during the
nine months ended December 31, 2000. Activity for the period included (i)
originations and purchases of $861.6 million, (ii) sales of $414.2 million, and
(iii) principal repayments and other adjustments of $359.3 million.

Total liabilities increased $230.4 million during the nine months ended December
31, 2000. Deposits increased $170.4 million during the nine months ended
December 31, 2000. The increase was due primarily to new demand deposit products
and certificate promotions. Brokered deposits have been used in the past and may
be used in the future as the need for funds requires them. Brokered deposits
totaled $118.5 million at December 31, 2000 and generally mature within one
year. FHLB advances and other borrowings increased $70.5 million during the nine
months ended December 31, 2000. Reverse repurchase agreements decreased $46.4
million during the nine months ended December 31, 2000. Advance payments by
borrowers for taxes and insurance decreased $7.6 million during this same
period. Other liabilities increased $43.3 million during the nine-month period
ending December 31, 2000 due to the increased liability for escrow tax check
disbursements.

Stockholders' equity decreased $3.8 million during the nine months ended
December 31, 2000 as a net result of (i) comprehensive income of $21.1 million
(ii) stock options exercised of $2.3 million (with the excess of the cost of
treasury shares over the option price ($1.4 million) charged to retained
earnings), (iii) the tax benefit of $80,000 from the exercise of certain stock
options, (iv) the purchase of stock by retirement plans of $1.2 million, and (v)
benefit plan shares earned and related tax adjustments totaling $210,000. These
increases were offset by (i) purchases of treasury stock of $22.0 million and
(ii) cash dividends of $5.1 million.





                                       15

<PAGE>   17

ASSET QUALITY

Loans are placed on non-accrual status when, in the judgment of management, the
probability of collection of interest is deemed to be insufficient to warrant
further accrual. When a loan is placed on non-accrual status, previously accrued
but unpaid interest is deducted from interest income. As a matter of policy, the
Corporation does not accrue interest on loans past due 90 days or more.

Non-performing assets increased $1.1 million to $6.7 million at December 31,
2000 from $5.6 million at March 31, 2000 and increased as a percentage of total
assets to 0.21% from 0.19% at such dates, respectively.

Non-performing assets are summarized as follows at the dates indicated:


<TABLE>
<CAPTION>
                                                                                       AT MARCH 31,
                                                 AT DECEMBER 31,       ---------------------------------------------
                                                      2000                   2000            1999             1998
                                                -----------------      ---------------------------------------------
                                                                       (Dollars In Thousands)
<S>                                             <C>                    <C>               <C>                <C>
Non-accrual loans:
 Single-family residential                          $ 2,907              $ 2,582          $ 2,931           $ 3,256
 Multi-family residential                               372                    3             --                 898
 Commercial real estate                                 633                  126              145               288
 Construction and land                                  257                 --               --                --
 Consumer                                               411                  571              571               765
 Commercial business                                    996                  332              359               769
                                                    -------              -------          -------           -------
  Total non-accrual loans                             5,576                3,614            4,006             5,976
Real estate held for development and sale               845                1,691            1,764             4,431
Foreclosed properties and repossessed assets, net       292                  272              630             3,794
                                                    -------              -------          -------           -------
  Total non-performing assets                       $ 6,713              $ 5,577          $ 6,400           $14,201
                                                    =======              =======          =======           =======

Performing troubled debt restructurings             $   300              $   144          $   293           $   725
                                                    -------              -------          -------           -------

Total non-accrual loans to total loans                 0.22%                0.15%            0.18%             0.29%
Total non-performing assets to total assets            0.21                 0.19             0.24              0.56
Allowance for loan losses to total loans               0.96                 1.00             1.08              1.23
Allowance for loan losses to total
 non-accrual loans                                   431.80               675.26           599.78            425.03
Allowance for loan and foreclosure losses
 to total non-performing assets                      359.30               439.63           379.97            181.15
</TABLE>



Non-accrual loans increased $2.0 million during the nine months ended December
31, 2000. At December 31, 2000, there was one non-accrual single family mortgage
loan with a carrying value of $1.0 million. The balance of the increase was not
attributable to any one loan.

Non-performing real estate held for development and sale decreased $850,000 for
the nine months ended December 31, 2000. At December 31, 2000, there were no
properties in non-performing real estate held for development and sale with a
carrying value greater than $1.0 million.

Foreclosed properties and repossessed assets increased $20,000 during the nine
months ended December 31, 2000. There were no foreclosed properties and
repossessed assets with a carrying value greater than $1.0 million at December
31, 2000.


                                       16

<PAGE>   18

Performing troubled debt restructurings increased $160,000 during the nine
months ended December 31, 2000 due to the addition of an unimproved land
mortgage loan.

At December 31, 2000, assets that the Corporation has classified as substandard,
net of reserves, consisted of $7.9 million of loans and foreclosed properties.
As of March 31, 2000, the substandard assets amounted to $10.7 million. The
decrease of $2.8 million in substandard assets was due largely to a decrease of
$2.5 million in substandard mortgage loans and a decrease of $1.1 million in
substandard investments. The decrease in substandard mortgage loans was
substantially due to a $4.0 million commercial mortgage loan that paid off
during the nine-month period ended December 31, 2000. The decrease in
substandard investments was due to the sale of three units of a condominium
project in Bloomington, Minnesota which were held for development and sale.
These decreases in substandard assets were offset by an increase of $950,000 in
substandard commercial loans.

The following table sets forth information relating to the Corporation's loans
that were less than 90 days delinquent at the dates indicated.
<TABLE>
<CAPTION>
                                                                                         AT MARCH 31,
                                                 AT DECEMBER 31,       ----------------------------------------------
                                                      2000                   2000            1999             1998
                                                -----------------      ----------------------------------------------
                                                                            (In Thousands)
<S>                                             <C>                    <C>                 <C>                <C>
30 to 59 days                                          $6,272                $3,224        $5,535             $7,525
60 to 89 days                                           2,611                   903           693              1,397
                                                       ------                ------        ------             ------
   Total                                               $8,883                $4,127        $6,228             $8,922
                                                       ======                ======        ======             ======
</TABLE>



The Corporation's loan portfolio, foreclosed properties and repossessed assets
are evaluated on a continuing basis to determine the necessity for additions to
the allowance for losses and the related balance in the allowances. These
evaluations consider several factors, including, but not limited to, general
economic conditions, loan portfolio composition, loan delinquencies, prior loss
experience, collateral value, anticipated loss of interest and management's
estimation of future potential losses. The evaluation of the allowance for loan
losses includes a review of known loan problems as well as potential problems
based upon historical trends and ratios. Foreclosed properties are recorded at
the lower of carrying value or fair value with charge-offs, if any, charged to
the allowance for loan losses prior to transfer to foreclosed property. The fair
value is primarily based on appraisals, discounted cash flow analysis (the
majority of which are based on current occupancy and lease rates) and pending
offers.


                                       17


<PAGE>   19

A summary of the activity in the allowance for losses on loans follows:

<TABLE>
<CAPTION>
                                                        Three Months Ended                    Nine Months Ended
                                                           December 31,                         December 31,
                                                 ---------------------------------    ----------------------------------
                                                       2000            1999                 2000             1999
                                                 ---------------------------------    ----------------------------------
                                                                         (Dollars In Thousands)

<S>                                              <C>                  <C>             <C>                    <C>
Allowance at beginning of period                    $ 24,140          $ 24,732             $ 24,404          $ 24,324
Charge-offs:
  Mortgage                                               (23)               (5)                (536)               (9)
  Consumer                                              (234)             (211)                (600)             (793)
  Commercial business                                    (12)             (189)                 (13)             (361)
                                                    --------          --------             --------          --------
     Total charge-offs                                  (269)             (405)              (1,149)           (1,163)
Recoveries:
  Mortgage                                                15                 9                  232                42
  Consumer                                                39                26                   78               142
  Commercial business                                      2                11                   17                22
                                                    --------          --------             --------          --------
     Total recoveries                                     56                46                  327               206
                                                    --------          --------             --------          --------
     Net charge-offs                                    (213)             (359)                (822)             (957)
Provision                                                150               150                  495             1,156
                                                    --------          --------             --------          --------
   Allowance at end of period                       $ 24,077          $ 24,523             $ 24,077          $ 24,523
                                                    --------          --------             --------          --------
Net charge-offs to average loans                       (0.03)%           (0.06)%              (0.05)%           (0.06)%
                                                    --------          --------             --------          --------
</TABLE>




Although management believes that the December 31, 2000 allowance for loan
losses is adequate, based upon the current evaluation of loan delinquencies,
non-accrual loans, charge-off trends, economic conditions and other factors,
there can be no assurance that future adjustments to the allowance, which could
adversely affect the Corporation's results of operations, will not be necessary.
Management also continues to pursue all practical and legal methods of
collection, repossession and disposal, as well as adhering to high underwriting
standards in the origination process, in order to maintain strong asset quality.

LIQUIDITY AND CAPITAL RESOURCES

On an unconsolidated basis, the Corporation's sources of funds include dividends
from its subsidiaries, including the Bank, interest on its investments and
returns on its real estate held for sale. The Bank's primary sources of funds
are payments on loans and mortgage-related securities, deposits from retail and
wholesale sources, advances and other borrowings.

At December 31, 2000, the Corporation had outstanding commitments to originate
loans of $70.9 million, commitments to extend funds to, or on behalf of,
customers pursuant to lines and letters of credit of $142.2 million and loans
sold with recourse to the Corporation in the event of default by the borrower of
$1.1 million. The Corporation had sold loans with recourse in the amount of $5.8
million through the FHLB Mortgage Partnership Finance Program at December 31,
2000. Scheduled maturities of certificates of deposit during the twelve months
following December 31, 2000 amounted to $1.0 billion and scheduled maturities of
FHLB advances during the same period totaled $491.9 million. At December 31,
2000, the Corporation also had $46.0 million of reverse repurchase agreements,
all of which are scheduled to mature during the twelve months following December
31, 2000. Management believes adequate capital and borrowings are available from
various sources to fund all commitments to the extent required.


                                       18

<PAGE>   20

The Bank is required by the Office of Thrift Supervision ("OTS") to maintain
specified levels of liquid investments in qualifying types of U.S. Government
and agency securities and other investments. This requirement, which may be
varied by the OTS, is based upon a percentage of deposits and short-term
borrowings. The required percentage is currently 4.0%. During the quarter ended
December 31, 2000, the Bank's average liquidity ratio was 13.3%.

Under federal law and regulation, the Bank is required to meet certain tangible,
core and risk-based capital requirements. Tangible capital generally consists of
stockholders' equity minus certain intangible assets. Core capital generally
consists of tangible capital plus qualifying intangible assets. The risk-based
capital requirements presently address credit risk related to both recorded and
off-balance sheet commitments and obligations. The OTS requirement for the core
capital ratio for the Bank is currently 3.00%. The requirement is 4.00% for all
but the most highly-rated financial institutions.

The following summarizes the Bank's capital levels and ratios and the levels and
ratios required by the OTS at December 31, 2000 and March 31, 2000 (dollars in
thousands):

<TABLE>
<CAPTION>
                                                                                                   MINIMUM REQUIRED
                                                                      MINIMUM REQUIRED                 TO BE WELL
                                                                         FOR CAPITAL                CAPITALIZED UNDER
                                           ACTUAL                     ADEQUACY PURPOSES             OTS REQUIREMENTS
                               --------------------------------------------------------------------------------------------
                                    AMOUNT           RATIO          AMOUNT           RATIO          AMOUNT        RATIO
                               --------------------------------------------------------------------------------------------
<S>                            <C>                   <C>            <C>              <C>            <C>           <C>
AS OF DECEMBER 31, 2000:
Tier 1 capital
  (to adjusted tangible assets)        $ 193,235          6.25%         $ 92,704          3.00%       $ 154,507       5.00%
Risk-based capital
  (to risk-based assets)                 217,084         10.37           167,516          8.00          209,395      10.00
Tangible capital
  (to tangible assets)                   193,235          6.25            46,352          1.50             N/A        N/A

AS OF MARCH 31, 2000:
Tier 1 capital
  (to adjusted tangible assets)          188,606          6.56            86,201          3.00          143,669       5.00
Risk-based capital
  (to risk-based assets)                 212,066         11.07           153,196          8.00          191,495      10.00
Tangible capital
  (to tangible assets)                   188,606          6.56            43,101          1.50             N/A        N/A
</TABLE>








                                       19



<PAGE>   21


The following table reconciles stockholder equity to regulatory capital at
December 31, 2000 and March 31, 2000 (dollars in thousands):

<TABLE>
<CAPTION>
                                                                      DECEMBER 31,          MARCH 31,
                                                                   ------------------------------------
                                                                         2000                  2000
                                                                   ------------------------------------

<S>                                                                 <C>                      <C>
Stockholders' equity of the Corporation                               $ 213,373              $ 217,215
Less: Capitalization of the Corporation and Non-Bank
  subsidiaries                                                          (19,379)               (28,944)
                                                                      ---------              ---------
Stockholders' equity of the Bank                                        193,994                188,271
Intangible assets and other non-includable assets                          (759)                   335
                                                                      ---------              ---------
Tier 1 and tangible capital                                             193,235                188,606
Plus: Allowable general valuation allowances                             23,849                 23,460
                                                                      ---------              ---------
Risk based capital                                                    $ 217,084              $ 212,066
                                                                      =========              =========
</TABLE>








ASSET/LIABILITY MANAGEMENT

The primary function of asset and liability management is to provide liquidity
and maintain an appropriate balance between interest-earning assets and
interest-bearing liabilities within specified maturities and/or repricing dates.
Interest rate risk is the imbalance between interest-earning assets and
interest-bearing liabilities at a given maturity or repricing date, and is
commonly referred to as the interest rate gap (the "gap"). A positive gap exists
when there are more assets than liabilities maturing or repricing within the
same time frame. A negative gap occurs when there are more liabilities than
assets maturing or repricing within the same time frame. During a period of
rising interest rates, a negative gap over a particular period would tend to
adversely affect net interest income over such period, while a positive gap over
a particular period would tend to result in an increase in net interest income
over such period.

The Corporation's strategy for asset and liability management is to maintain an
interest rate gap that minimizes the impact of interest rate movements on the
net interest margin. As part of this strategy, the Corporation sells
substantially all new originations of long-term, fixed-rate, single-family
residential mortgage loans in the secondary market, and invests in
adjustable-rate or medium-term, fixed-rate, single-family residential mortgage
loans, medium-term mortgage-related securities and consumer loans, which
generally have shorter terms to maturity and higher interest rates than
single-family mortgage loans.

The Corporation also originates multi-family residential and commercial real
estate loans, which generally have adjustable or floating interest rates and/or
shorter terms to maturity than conventional single-family residential loans.
Long-term, fixed-rate, single-family residential mortgage loans originated for
sale in the secondary market are generally committed for sale at the time the
interest rate is locked with the borrower. As such, these loans involve little
interest rate risk to the Corporation.

The calculation of a gap position requires management to make a number of
assumptions as to when an asset or liability will reprice or mature. Management
believes that its assumptions approximate actual experience and considers them
reasonable, although the actual amortization and repayment of assets and
liabilities may vary substantially. The cumulative net gap position at December
31, 2000 has not changed materially since March 31, 2000.



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<PAGE>   22


ITEM 3            QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

                  Not applicable.


                           PART II - OTHER INFORMATION

ITEM 1            LEGAL PROCEEDINGS.

The Corporation is involved in routine legal proceedings occurring in the
ordinary course of business which, in the aggregate, are believed by management
of the Corporation to be immaterial to the financial condition and results of
operations of the Corporation.


ITEM 2            CHANGES IN SECURITIES.

                  Not applicable.


ITEM 3            DEFAULTS UPON SENIOR SECURITIES.

                  Not applicable.

ITEM 4            SUBMISSION OF MATTER TO VOTE OF SECURITIES HOLDERS.

                  Not applicable.

ITEM 5            OTHER INFORMATION.

                  None.

ITEM 6            EXHIBITS AND REPORTS.

          (a)     REPORTS ON FORM 8-K.

                  None.






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<PAGE>   23



                                   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.



                                           ANCHOR BANCORP WISCONSIN INC.



Date:   January 31, 2001       By:/s/ Douglas J. Timmerman
      --------------------        --------------------------------------------
                                  Douglas J. Timmerman, Chairman of the
                                  Board, President and Chief Executive Officer




Date:   January 31, 2001       By:/s/ Michael W. Helser
      --------------------        --------------------------------------------
                                  Michael W. Helser, Treasurer and
                                  Chief Financial Officer






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