<PAGE>

                       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 June 30, 2004

                                       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 by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).

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 July 31, 2004: 23,060,279

<PAGE>

                          ANCHOR BANCORP WISCONSIN INC.
                                INDEX - FORM 10-Q

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

         Item 1       Financial Statements (Unaudited)

                              Consolidated Balance Sheets as of June 30, 2004
                              and March 31, 2004                                                              2

                              Consolidated Statements of Income for the Three
                              Months Ended June 30, 2004 and 2003                                             3

                              Consolidated Statements of Cash Flows for the Three Months
                              Ended June 30, 2004 and 2003                                                    4

                              Notes to Unaudited Consolidated Financial Statements                            6

         Item 2       Management's Discussion and Analysis of Financial Condition and
                      Results of Operations                                                                  10

                              Results of Operations                                                          11

                              Financial Condition                                                            15

                              Asset Quality                                                                  16

                              Liquidity & Capital Resources                                                  19

                              Asset/Liability Management                                                     22

                              Segment Reporting                                                              23

         Item 3       Quantitative and Qualitative Disclosures About Market Risk                             25

         Item 4       Controls and Procedures                                                                25

PART II - OTHER INFORMATION

         Item 1       Legal Proceedings                                                                      25
         Item 2       Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities       26
         Item 3       Defaults upon Senior Securities                                                        26
         Item 4       Submission of Matters to a Vote of Security Holders                                    26
         Item 5       Other Information                                                                      27
         Item 6       Exhibits and Reports on Form 8-K                                                       27

SIGNATURES                                                                                                   28
</TABLE>

                                        1
<PAGE>

                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                               (Unaudited)
                                                                                 JUNE 30,             MARCH 31,
                                                                                   2004                  2004
                                                                               ----------------------------------
                                                                               (In Thousands, Except Share Data)
<S>                                                                            <C>                   <C>
ASSETS
Cash                                                                           $    59,855           $    65,938
Interest-bearing deposits                                                          106,377               133,055
                                                                               -----------           -----------
  Cash and cash equivalents                                                        166,232               198,993
Investment securities available for sale                                            48,865                29,514
Mortgage-related securities available for sale                                     204,051               220,918
Mortgage-related securities held to maturity (fair value of
 $3,869 and $4,489, respectively)                                                    3,740                 4,303
Loans receivable, net:
  Held for sale                                                                     11,032                14,578
  Held for investment                                                            3,162,136             3,066,812
Foreclosed properties and repossessed assets, net                                      687                 2,422
Real estate held for development and sale                                           62,858                77,749
Office properties and equipment                                                     30,786                31,233
Federal Home Loan Bank stock--at cost                                               78,612                87,320
Accrued interest on investments and loans and other assets                          50,698                56,588
Goodwill                                                                            19,956                19,956
                                                                               -----------           -----------
     Total assets                                                              $ 3,839,653           $ 3,810,386
                                                                               ===========           ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits and advance payments by borrowers for taxes and insurance             $ 2,663,376           $ 2,609,686
Federal Home Loan Bank and other borrowings                                        807,614               831,559
Other liabilities                                                                   54,658                60,902
                                                                               -----------           -----------
    Total liabilities                                                            3,525,648             3,502,147
                                                                               -----------           -----------

Minority interest in real estate partnerships                                        6,290                 6,691
                                                                               -----------           -----------

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,22,997,911 and 22,954,535 shares outstanding, respectively            2,536                 2,536
Additional paid-in capital                                                          68,108                67,926
Retained earnings                                                                  291,891               284,329
Accumulated other comprehensive income                                                 184                 2,670
Treasury stock (2,365,428 shares and 2,408,804 shares, respectively), at cost      (49,244)              (50,324)
Unearned deferred compensation                                                      (5,760)               (5,589)
                                                                               -----------           -----------
     Total stockholders' equity                                                    307,715               301,548
                                                                               -----------           -----------
     Total liabilities and stockholders' equity                                $ 3,839,653           $ 3,810,386
                                                                               ===========           ===========
</TABLE>

See accompanying Notes to Unaudited Consolidated Financial Statements.

                                        2
<PAGE>

                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                         THREE MONTHS ENDED JUNE 30,
                                                                    -------------------------------------
                                                                      2004                        2003
                                                                    -------------------------------------
                                                                    (In Thousands, Except Per Share Data)
<S>                                                                 <C>                          <C>
INTEREST INCOME:
Loans                                                               $ 43,088                     $ 44,112
Mortgage-related securities                                            2,188                        2,870
Investment securities                                                  1,533                        1,880
Interest-bearing deposits                                                227                          180
                                                                    --------                     --------
  Total interest income                                               47,036                       49,042

INTEREST EXPENSE:
Deposits                                                              11,816                       14,522
Notes payable and other borrowings                                     7,014                        6,060
                                                                    --------                     --------
  Total interest expense                                              18,830                       20,582
                                                                    --------                     --------
  Net interest income                                                 28,206                       28,460
Provision for loan losses                                                450                          450
                                                                    --------                     --------
  Net interest income after provision for loan losses                 27,756                       28,010

NON-INTEREST INCOME:
Real estate investment partnership revenue                            23,967                            -
Loan servicing income (loss)                                             478                       (1,601)
Service charges on deposits                                            2,195                        2,004
Insurance commissions                                                    634                          624
Net gain on sale of loans                                                299                        9,807
Net gain on sale of investments and mortgage-related securities          868                          352
Other revenue from real estate operations                                907                          638
Other                                                                    915                        1,242
                                                                    --------                     --------
  Total non-interest income                                           30,263                       13,066

NON-INTEREST EXPENSE:
Compensation                                                           9,869                       10,388
Real estate investment partnership cost of sales                      19,819                            -
Occupancy                                                              1,704                        1,609
Furniture and equipment                                                1,382                        1,448
Data processing                                                        1,276                        1,174
Marketing                                                              1,007                          790
Other expenses from real estate operations                             2,714                            -
Other                                                                  2,657                        2,741
                                                                    --------                     --------

  Total non-interest expense                                          40,428                       18,150
                                                                    --------                     --------
Minority interest in income of real estate partnership operations      1,582                            -
                                                                    --------                     --------
  Income before income taxes                                          16,009                       22,926
Income taxes                                                           5,412                        8,833
                                                                    --------                     --------
  Net income                                                        $ 10,597                     $ 14,093
                                                                    ========                     ========

Earnings per share:
  Basic                                                             $   0.47                     $   0.61
  Diluted                                                               0.46                         0.59
Dividends declared per share                                            0.11                         0.10
</TABLE>

See accompanying Notes to Unaudited Consolidated Financial Statements.

                                        3
<PAGE>

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                THREE MONTHS ENDED JUNE 30,
                                                                                ---------------------------
                                                                                  2004             2003
                                                                                ---------------------------
                                                                                       (IN THOUSANDS)
<S>                                                                             <C>              <C>
OPERATING ACTIVITIES
 Net income                                                                     $  10,597        $  14,093
 Adjustments to reconcile net income to net cash provided (used) by operating
  activities:
 Provision for loan losses                                                            450              450
 Provision for depreciation and amortization                                        1,105              888
 Net increase (decrease) due to origination and sale of loans held
  for sale                                                                          3,546          (18,612)
 Net gain on sales of loans                                                          (299)          (9,807)
 Amortization of stock benefit plans                                                   62               33
 Tax benefit from stock related compensation                                          182              989
 (Increase) decrease in accrued interest receivable                                (1,235)             195
 Decrease in accrued interest payable                                                (264)            (307)
 Decrease in accounts payable                                                      (8,609)            (171)
 Other                                                                             (8,835)         (14,014)
                                                                                ---------        ---------
  Net cash used by operating activities                                            (3,300)         (26,263)

INVESTING ACTIVITIES
 Proceeds from sales of investment securities available for sale                    1,109              744
 Proceeds from maturities of investment securities                                 72,460           97,884
 Purchase of investment securities available for sale                             (92,552)         (82,921)
 Proceeds from sale of mortgage-related securities available for sale              12,869            4,535
 Purchase of mortgage-related securities available for sale                       (19,572)         (25,312)
 Principal collected on mortgage-related securities                                20,984           53,400
 Loans originated for investment                                                 (457,174)        (361,545)
 Principal repayments on loans                                                    390,395          328,975
 Purchases of office properties and equipment                                        (586)            (935)
 Sales of office properties and equipment                                             171                7
 Sales of real estate                                                               2,615             (344)
 Investment in real estate held for development and sale                           12,201            1,348
                                                                                ---------        ---------
  Net cash provided (used) by investing activities                                (57,080)          15,836
</TABLE>

                                        4
<PAGE>

                 CONSOLIDATED STATEMENTS OF CASH FLOWS (Cont'd)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                          THREE MONTHS ENDED JUNE 30,
                                                                          ---------------------------
                                                                            2004              2003
                                                                          ---------------------------
                                                                                 (IN THOUSANDS)
<S>                                                                       <C>               <C>
FINANCING ACTIVITIES
Increase in deposit accounts                                              $  47,474         $  59,315
 Increase in advance payments by borrowers
   for taxes and insurance                                                    6,216             6,356
 Proceeds from notes payable to Federal Home Loan Bank                       47,200           154,450
 Repayment of notes payable to Federal Home Loan Bank                       (64,900)         (146,500)
 (Decrease) increase in other loans payable                                  (6,245)            3,848
 Treasury stock purchased                                                       -              (3,876)
 Exercise of stock options                                                      312               221
 Issuance of management and benefit plans                                        88               439
 Payments of cash dividends to stockholders                                  (2,526)           (2,381)
                                                                          ---------         ---------
   Net cash provided by financing activities                                 27,619            71,872
                                                                          ---------         ---------
   Net (decrease) increase in cash and cash equivalents                     (32,761)           61,445
 Cash and cash equivalents at beginning of period                           198,993           141,427
                                                                          ---------         ---------
   Cash and cash equivalents at end of period                             $ 166,232         $ 202,872
                                                                          =========         =========

SUPPLEMENTARY CASH FLOW INFORMATION:
Cash paid or credited to accounts:
  Interest on deposits and borrowings                                     $  17,595         $  20,777
  Income taxes                                                                6,412             3,551
</TABLE>

See accompanying Notes to Unaudited Consolidated Financial Statements

                                        5
<PAGE>

                          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"), and Investment
Directions, Inc. ("IDI"). 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"). Significant
intercompany balances and transactions have been eliminated. Investments in 50%
owned partnerships are treated as variable interest entities and are
consolidated into the Corporation's balance sheet and income statement.

NOTE 2 - BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared
in accordance with accounting principles generally accepted in the United States
of America 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 three-month period ended June 30, 2004 are not
necessarily indicative of results that may be expected for any other interim
period or the entire fiscal year ending March 31, 2005. 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, 2004.

Unrealized gains or losses on the Corporation's available-for-sale securities
are included in other comprehensive income. During the quarter ended June 30,
2004 and 2003, total comprehensive income amounted to $8.1 million and $13.5
million, respectively.

The Corporation's investment in real estate held for investment and sale
includes 50% owned real estate partnerships which are considered variable
interest entities ("VIE's") and therefore subject to the requirements of
Financial Accounting Standards Interpretation No. 46, Consolidation of Variable
Interest Entities, an Interpretation of Accounting Research Bulletin No. 51
("FIN 46"). FIN 46 requires the consolidation of entities in which an enterprise
absorbs a majority of the entity's expected losses, receives a majority of the
entity's expected residual returns, or both, as a result of ownership,
contractual or other financial interests in the entity.

Real estate investment partnership revenue is presented in non-interest income
and represents revenue recognized upon the closing of sales of developed lots
and homes to independent third parties. Real estate investment partnership cost
of sales is included in non-interest expense and represents the costs of such
closed sales. Other revenue and other expenses from real estate operations are
also included in non-interest income and non-interest expense, respectively.

Minority interest in real estate partnerships represents the equity interests of
development partners in the real estate investment partnerships. The development
partners' share of income is reflected as minority interest in income of real
estate partnership operations. For all VIE's formed after February 1, 2003, the
statements of condition and results of operations must reflect prior period
assets, liabilities, income and expense. Since none of the Corporation's VIE's
were formed after February 1, 2003, no restatement of prior periods is required.

                                        6
<PAGE>

The Financial Accounting Standards Board ("FASB") issued SFAS No. 148,
"Accounting for Stock-Based Compensation - Transition and Disclosure" in
December, 2002. SFAS No. 148 amended SFAS No. 123, "Accounting for Stock-Based
Compensation" to provide alternative methods of transition to the fair value
method of accounting for stock-based employee compensation. In addition, SFAS
No. 148 amended the disclosure provisions of SFAS No. 123 to require disclosure
in the summary of significant accounting policies of the effect of the Company's
accounting policy with respect to stock-based employee compensation on reported
net income and earnings per share in annual and interim financial statements.
SFAS No. 148's amendment of the transition and annual disclosure provisions of
SFAS No. 123 are effective for fiscal years ending after December 15, 2002. The
Corporation will continue to account for stock-based compensation in accordance
with APB Opinion 25 as allowed under FASB No. 123.

The Corporation applies APB Opinion No. 25 and related interpretations in
accounting for stock options. Accordingly, no compensation cost has been
recognized for its stock option plans. Had compensation cost for the
Corporation's stock option plans been determined based on the fair value at the
date of grant for awards under the stock option plans consistent with the method
of SFAS No. 123, the Corporation's net income and earnings per share would have
been reduced to the pro forma amounts indicated:

<TABLE>
<CAPTION>
                                         THREE MONTHS ENDED
                                              JUNE 30,
                                -------------------------------------
                                   2004                       2003
                                -------------------------------------
                                (In Thousands, Except Per Share Data)
<S>                             <C>                        <C>
Net Income
  As reported                   $   10,597                 $   14,093
  Pro forma                         10,471                     13,994

Earnings per share-Basic
  As reported                   $     0.47                 $     0.61
  Pro forma                           0.46                       0.61

Earnings per share-Diluted
  As reported                   $     0.46                 $     0.59
  Pro forma                           0.45                       0.59
</TABLE>

The pro forma amounts indicated above may not be representative of the effects
on reported net income for future years. The fair values of stock options
granted in the three months ended June 30, 2004 and June 30, 2003 were estimated
on the date of grant using the Black-Scholes option-pricing model.

Certain 2003 accounts have been reclassified to conform to the 2004
presentations.

                                        7
<PAGE>

NOTE 3 - GOODWILL AND OTHER INTANGIBLE ASSETS

The Corporation's carrying value of goodwill was $20.0 million at June 30, 2004
and at March 31, 2004. Information regarding the Company's other intangible
assets follows:

<TABLE>
<CAPTION>
                                        JUNE 30, 2004                   MARCH 31, 2004
                              --------------------------------  -------------------------------
                              CARRYING    ACCUMULATED           CARRYING  ACCUMULATED
                               AMOUNT    AMORTIZATION    NET     AMOUNT   AMORTIZATION    NET
                              --------------------------------  -------------------------------
                                                       (In Thousands)
<S>                           <C>        <C>           <C>      <C>       <C>           <C>
Other intangible assets:
  Core deposit premium        $  3,408   $      2,442  $   966   $ 3,408  $      2,229  $ 1,179
  Mortgage servicing rights     15,938          2,728   13,210    21,613         9,325   12,288
                              --------   ------------  -------  --------  ------------  -------
  Total                       $ 19,346   $      5,170  $14,176   $25,021  $     11,554  $13,467
                              ========   ============  =======  ========  ============  =======
</TABLE>

The projections of amortization expense for mortgage servicing rights and core
deposit premium set forth below are based on asset balances and the interest
rate environment as of June 30, 2004. Future amortization expense may be
significantly different depending upon changes in the mortgage servicing
portfolio, mortgage interest rates and market conditions.

The following table shows the current period and estimated future amortization
expense for amortized intangible assets:

<TABLE>
<CAPTION>
                                       MORTGAGE    CORE
                                       SERVICING  DEPOSIT
                                        RIGHTS    PREMIUM   TOTAL
                                       ---------  -------  -------
                                              (In Thousands)
<S>                                    <C>        <C>      <C>
Quarter ended June 30, 2004 (actual)   $   1,600  $   213  $ 1,813

Estimate for the year ended March 31,
                      2005                 6,400      852    7,252
                      2006                 3,360      114    3,474
                      2007                 1,725        -    1,725
                      2008                 1,725        -    1,725
                                       ---------  -------  -------
                                       $  13,210  $   966  $14,176
                                       =========  =======  =======
</TABLE>

NOTE 4 - STOCKHOLDERS' EQUITY

During the quarter ended June 30, 2004, options for 41,661 shares of common
stock were exercised at a weighted-average price of $10.47 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 of $593,000 was charged to retained earnings. During the quarter ended June
30, 2004, the Corporation issued 6,811 shares of treasury stock to the
Corporation's retirement plans. The weighted-average cost of these shares was
$24.75 per share or $169,000 in the aggregate and the gain of the market price
over the cost of the treasury shares of $6,000 was credited to retained
earnings. On May 14, 2004, the Corporation paid a cash dividend of $0.11 per
share, amounting to $2.5 million.

                                        8
<PAGE>

NOTE 5 - EARNINGS PER SHARE

Basic earnings per share for the three months ended June 30, 2004 and 2003 have
been determined by dividing net income for the respective periods by the
weighted average number of shares of common stock outstanding. Diluted earnings
per share is computed by dividing net income by the weighted average number of
common shares outstanding plus common stock equivalents. Common stock
equivalents are computed using the treasury stock method.

<TABLE>
<CAPTION>
                                                THREE MONTHS ENDED JUNE 30,
                                                ---------------------------
                                                    2004          2003
                                                ---------------------------
<S>                                             <C>            <C>
Numerator:
      Net income                                 $10,597,198   $14,093,018
                                                 -----------   -----------
      Numerator for basic and diluted earnings
        per share--income available to common
        stockholders                             $10,597,198   $14,093,018

Denominator:
      Denominator for basic earnings per
        share--weighted-average common
        shares outstanding                        22,596,936    23,226,753
      Effect of dilutive securities:
        Employee stock options                       475,014       530,135
        Management Recognition Plans                   5,074        14,627
      Denominator for diluted earnings per
        share--adjusted weighted-average
                                                 -----------   -----------
        common shares and assumed conversions     23,077,024    23,771,515
                                                 ===========   ===========
Basic earnings per share                         $      0.47   $      0.61
                                                 ===========   ===========
Diluted earnings per share                       $      0.46   $      0.59
                                                 ===========   ===========
</TABLE>

NOTE 6 - CONTINGENT LIABILITIES

The Wisconsin Department of Revenue recently completed an audit of AnchorBank in
connection with the Department's review of financial institutions that
transferred investment securities to its out-of-state investment subsidiaries.
The Bank settled with the Department as regards the taxation of its Nevada
investment subsidiary. Among other provisions, AnchorBank agreed to pay
Wisconsin tax on the income of its Nevada investment subsidiary for the fourth
quarter of fiscal 2004, and for future periods. Management estimates that in
fiscal 2005, the additional income tax expense related to its Nevada investment
subsidiary's operations will amount to approximately $0.06 per diluted share.
The Company reduced its tax accrual, in part as a result of the settlement. This
reduction, when combined with the impact of the settlement for periods prior to
fiscal 2005, resulted in an increase in earnings for the quarter of
approximately $0.05 cents per diluted share.

NOTE 7 - SUBSEQUENT EVENTS

On July 20, 2004, the Corporation declared a $0.125 per share cash dividend on
its common stock to be paid on August 13, 2004 to stockholders of record on July
30, 2004.

                                        9
<PAGE>

                          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. 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 Board, 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. In
addition, acquisitions may result in large one-time charges to income, may not
produce revenue enhancements or cost savings at levels or within time frames
originally anticipated and may result in unforeseen integration difficulties.
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.

SIGNIFICANT ACCOUNTING POLICIES

      There are a number of accounting policies that require the use of
judgment. Some of the more significant policies are as follows:

-    Establishing the amount of the allowance for loan losses requires the use
     of judgment as well as other systematic objective and quantitative methods.
     The loan portfolio, foreclosed properties, and repossessed assets are
     evaluated on a continuous basis to determine the necessity for additions to
     the allowances for losses and the related balance in the allowances. These
     evaluations consider several factors including, but not limited to, general
     economic conditions, collateral value, loan portfolio composition, loan
     delinquencies, prior loss experience, anticipated loss of interest and
     losses inherent in the portfolio. The evaluation of the allowance for loan
     losses includes a review of known loan problems as well as potential loan
     problems based upon historical trends and ratios. To determine the level
     and composition of the loan loss allowance, the loan portfolio is broken
     out by categories of single-family residential, multi-family residential,
     commercial real estate, construction and land, consumer and commercial
     business. These categories are then further divided into performing and
     substandard, which includes performing and non-performing groups of loans.
     A five-year historical trend is applied to each category of performing
     loans to arrive at the appropriate levels of loss reserves for those
     respective categories based on the ratio of loss history to overall balance
     in each respective loan category. The non-performing groups are analyzed
     using the trends of the current year in which they are being evaluated. For
     commercial business loans, a three-year historical trend is applied since
     that category has shown significant growth both in terms of overall balance
     and loss history associated with that growth. The Corporation has allocated
     all of its allowance for loan losses to specific categories as a result of
     more precise analysis of loan portfolio performance. Also, within specific
     loan categories, certain loans may be identified for specific reserve
     allocations as well as the whole category of that loan type being reviewed
     for a calculated general reserve based on the foregoing analysis of trends
     and overall balance growth within that category.

                                       10
<PAGE>

-    Valuation of mortgage servicing rights requires the use of judgment.
     Mortgage servicing rights are established on loans that are originated and
     subsequently sold with servicing rights retained. A portion of the loan's
     book basis to mortgage servicing rights is allocated when a loan is sold.
     The fair value of mortgage servicing rights is the present value of
     estimated future net cash flows from the servicing relationship using
     current market assumptions for prepayments, servicing costs and other
     factors. As the loans are repaid and net servicing revenue is earned,
     mortgage servicing rights are amortized into expense. Net servicing
     revenues are expected to exceed this amortization expense. However, if
     actual prepayment experience exceeds what was originally anticipated, net
     servicing revenues may be less than expected and mortgage servicing rights
     may be impaired.

-    Judgment is also used in the valuation of other intangible assets (core
     deposit intangibles). Core deposit intangibles have been recorded for core
     deposits (defined as checking, money market and savings deposits) that have
     been acquired in acquisitions that were accounted for as purchase business
     combinations. The core deposit intangible assets have been recorded using
     the assumption that they provide a more favorable source of funding than
     more expensive wholesale borrowings. An intangible asset has been recorded
     for the present value of the difference between the expected interest to be
     incurred on these deposits and interest expense that would be expected if
     these deposits were replaced by wholesale borrowings, over the expected
     lives of the core deposits. The current estimate of the underlying lives of
     the core deposits is seven to fifteen years. If it is determined that these
     deposits have a shorter life, the asset will be adjusted to reflect an
     expense associated with the amount that is impaired.

-    Goodwill is reviewed at least annually for impairment, which requires
     judgment. Goodwill has been recorded as a result of an acquisition in which
     purchase price exceeded fair value of net assets acquired. The price paid
     for the acquisition is analyzed and compared to a number of current
     indices. If goodwill is determined to be impaired, it would be expensed in
     the period in which it became impaired.

Set forth below is management's discussion and analysis of the Corporation's
financial condition and results of operations for the three months ended June
30, 2004, which includes information on the Corporation's asset/liability
management strategies, sources of liquidity and capital resources. This
discussion 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 months ended June 30, 2004 decreased $3.5
million to $10.6 million from $14.1 million for the same period 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 a decrease in the gain on sale of loans of
$9.5 million partially offset by an increase of loan servicing income of $2.1
million and a decrease in income tax expense of $3.4 million.

Net Interest Income. Net interest income decreased $250,000 for the three months
ended June 30, 2004 as compared to the same period in the prior year. Interest
income decreased $2.0 million for the three months ended June 30, 2004 as
compared to the same period in the prior year, primarily due to a decrease in
the weighted average rate on interest earning assets to 5.22% from 5.83%. These
decreases were offset by a decrease in interest expense of $1.8 million for the
three months ended June 30, 2004 as compared to the same period in the prior
year. The net interest margin decreased to 3.13% from 3.39% for the respective
three-month periods. The decrease in the net interest margin is reflective of a
decrease in the cost of funds, offset by a larger decrease in yields on loans as
interest rates continue to decrease. The interest rate spread decreased to 3.05%
from 3.27% for the same respective periods.

Interest income on loans decreased $1.0 million for the three months ended June
30, 2004 as compared to the same period in the prior year. This decrease was the
result of a decrease of 63 basis points in the average yield on loans to 5.50%
from 6.13% for the respective three-month periods. Interest income on
mortgage-related securities decreased $680,000 for the three-month period ended
June 30, 2004, as compared to the same period in the prior year, primarily due
to a decrease of $19.7 million in the average balance of mortgage related
securities and a decrease of 81 basis points in the average yield on
mortgage-related securities to 3.99% from 4.80%. In addition, interest income on
investment securities (including Federal Home Loan Bank stock) decreased
$350,000 for the three-month

                                       11
<PAGE>

period ended June 30, 2004, as compared to the same period in the prior year.
This was primarily a result of a decrease of $44.4 million in the average
balance of investment securities for the three-month period ended June 30, 2004,
as compared to the same period in 2003. Interest income on interest-bearing
deposits increased $50,000 for the three months ended June 30, 2004, as compared
to the same period in 2003.

Interest expense on deposits decreased $2.7 million for the three months ended
June 30, 2004, as compared to the same period in 2003. This decrease was due
primarily to a decrease of 45 basis points in the weighted average cost of
deposits to 1.78% from 2.23% for the respective three-month periods. Interest
expense on notes payable and other borrowings increased $950,000 during the
three months ended June 30, 2004, as compared to the same period in the prior
year due primarily to an increase of $212.9 million in the average balance of
notes payable and other borrowings for the three-month period ended June 30,
2004, as compared to the same period in 2003.

Provision for Loan Losses. Provision for loan losses remained constant at
$450,000 for the three-month period ended June 30, 2004, as compared to the same
period for the prior year. The provisions were based on management's ongoing
evaluation of asset quality and pursuant to a policy to maintain an allowance
for losses at a level which management believes is adequate to absorb future
charge-offs of loans deemed uncollectible.

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.

                                       12
<PAGE>

<TABLE>
<CAPTION>
                                                                 THREE MONTHS ENDED JUNE 30,
                                              -----------------------------------------------------------------
                                                             2004                             2003
                                              --------------------------------  -------------------------------
                                                                       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)                            $ 2,425,125   $  32,875   5.42%   $ 2,232,645   $ 33,883   6.07%
Consumer loans (2)                                546,785       7,992   5.85        508,606      8,190   6.44
Commercial business loans (2)                     161,018       2,221   5.52        135,549      2,039   6.02
                                              -----------   ---------           -----------   --------
  Total loans receivable (2)                    3,132,928      43,088   5.50      2,876,800     44,112   6.13
Mortgage-related securities                       219,293       2,188   3.99        238,987      2,870   4.80
Investment securities                              61,599         270   1.75        111,409        526   1.89
Interest-bearing deposits                         102,140         227   0.89         53,179        180   1.35
Federal Home Loan Bank stock                       87,891       1,263   5.75         82,509      1,354   6.56
                                              -----------   ---------           -----------   --------
  Total interest-earning assets                 3,603,851      47,036   5.22      3,362,884     49,042   5.83
Non-interest-earning assets                       222,720                           194,730
                                              -----------                       -----------
  Total assets                                $ 3,826,571                       $ 3,557,614
                                              ===========                       ===========

INTEREST-BEARING LIABILITIES
Demand deposits                               $   736,841         754   0.41    $   777,480        963   0.50
Regular passbook savings                          248,249         262   0.42        214,395        294   0.55
Certificates of deposit                         1,671,948      10,800   2.58      1,618,653     13,265   3.28
                                              -----------   ---------           -----------   --------
  Total deposits                                2,657,038      11,816   1.78      2,610,528     14,522   2.23
Notes payable and other borrowings                815,933       7,014   3.44        603,064      6,060   4.02
                                              -----------   ---------           -----------   --------
  Total interest-bearing liabilities            3,472,971      18,830   2.17      3,213,592     20,582   2.56
                                                                        ----                             ----
Non-interest-bearing liabilities                   48,798                            45,940
                                              -----------                       -----------
  Total liabilities                             3,521,769                         3,259,532
Stockholders' equity                              304,802                           298,082
                                              -----------                       -----------
  Total liabilities and stockholders' equity  $ 3,826,571                       $ 3,557,614
                                              ===========                       ===========

  Net interest income/interest rate spread                  $  28,206   3.05%                 $ 28,460   3.27%
                                                            =========   ====                  ========   ====
  Net interest-earning assets                 $   130,880                       $   149,292
                                              ===========                       ===========
  Net interest margin                                                   3.13%                            3.39%
                                                                        ====                             ====
  Ratio of average interest-earning assets
   to average interest-bearing liabilities           1.04                              1.05
                                              ===========                       ===========
</TABLE>

---------------------------------
(1) Annualized

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

                                       13
<PAGE>

Non-Interest Income. Non-interest income increased $17.2 million to $30.3
million for the three months ended June 30, 2004, as compared to $13.1 million
for the same period in 2003, primarily due to the addition of real estate
investment partnership revenue of $24.0 million as a result of implementation of
FIN 46 in the quarter ended December 31, 2003. Exclusive of the effects of FIN
46, non-interest income decreased $7.0 million, primarily as a result of the
decrease in net gain on sale of loans of $9.5 million. The decrease in the gain
on sale of loans was primarily due to the rising interest rate environment which
resulted in significantly lower levels of refinancing activity. In addition,
other non-interest income, which includes a variety of loan fee and other
miscellaneous fee income, decreased $330,000 for the three-month period ended
June 30, 2004, as compared to the same period in the prior year. These decreases
were partially offset by an increase in loan servicing income of $2.1 million
and an increase of $520,000 in net gain on sale of investments and
mortgage-related securities as compared to the same period in the prior year.
The increase in loan servicing income was due primarily to decreased
amortization of mortgage servicing rights, which resulted from decreases in loan
sales and mortgage loan refinancings in the rising interest rate environment. In
addition, service charges on deposits increased $190,000 and insurance
commissions remained relatively constant for the three-month period ended June
30, 2004, as compared to the same period in the prior year.

Non-Interest Expense. Non-interest expense increased $22.3 million to $40.4
million for the three months ended June 30, 2004, as compared to $18.2 million
for the same period in 2003, primarily due to the addition of real estate
investment partnership cost of sales of $19.8 million and other expenses from
real estate operations of $2.7 million as a result of implementation of FIN 46
in the quarter ended December 31, 2003. Exclusive of the effects of FIN 46,
non-interest expense decreased $260,000 primarily as a result of the decrease in
compensation expense of $520,000. In addition, other non-interest expense
decreased $80,000 and furniture and equipment expense decreased $70,000 for the
three months ended June 30, 2004 as compared to the same period in the prior
year. These decreases were partially offset by an increase in marketing expense
of $220,000, an increase in data processing expense of $100,000, and an increase
in occupancy expense of $100,000 for the three-month period ended June 30, 2004
as compared to the same period in the prior year.

Income Taxes. Income tax expense decreased $3.4 million during the three months
ended June 30, 2004, as compared to the same period in 2003. The decrease was
the result of a decrease in income before income tax of $6.9 million to $16.0
million for the three months ended June 30, 2004 as compared to $22.9 million
for the same period in the prior year. In addition, the Bank reduced its tax
accrual following the settlement with the Wisconsin Department of Revenue as
regards the taxation of its Nevada investment subsidiary. The effective tax rate
was 33.8% for the current three-month period, as compared to 38.5% for the
three-month period last year. The effective tax rate for future periods will
likely increase due to the additional income tax expense related to its Nevada
investment subsidiary.

                                       14
<PAGE>

FINANCIAL CONDITION

During the three months ended June 30, 2004, the Corporation's assets increased
by $29.3 million from $3.81 billion at March 31, 2004 to $3.84 billion. The
majority of this increase was attributable to an increase in loans and
investments, which were partially offset by decreases in other categories such
as mortgage-related securities, real estate held for development and Federal
Home Loan Bank stock.

Total loans (including loans held for sale) increased $91.8 million during the
three months ended June 30, 2004. Activity for the period consisted of (i)
originations and purchases of $738.1 million, (ii) sales of $284.5 million, and
(iii) principal repayments and other adjustments of $361.8 million.

Mortgage-related securities (both available for sale and held to maturity)
decreased $17.4 million during the three months ended June 30, 2004 as a result
of principal repayments and market value adjustments of $24.1 million and sales
of $12.9 million. These decreases were partially offset by purchases of $19.6
million of mortgage-related securities in this three-month period.
Mortgage-related securities consisted of $108.0 million of mortgage-backed
securities and $99.8 million of Collateralized Mortgage Obligations ("CMO's")
and Real Estate Mortgage Investment Conduits ("REMIC's") at June 30, 2004.

The Corporation invests in corporate CMOs and agency-issued REMICs. 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.

Investment securities increased $19.4 million during the three months ended June
30, 2004 as a result of purchases of $92.6 million of U.S. Government and agency
securities, which were substantially offset by sales and maturities of $73.6
million of such securities.

Federal Home Loan Bank stock decreased $8.7 million for the quarter ended June
30, 2004. This decrease was related to a return of excess holdings of FHLB stock
and was used to provide liquidity.

Real estate held for development decreased $14.9 million to $62.9 million as of
June 30, 2004 from $77.7 million as of June 30, 2003. This decrease was the
result of continued home and land lot sales.

Total liabilities increased $23.5 million during the three months ended June 30,
2004. This increase was largely due to a $53.7 million increase in deposits and
was partially offset by a $23.9 million decrease in FHLB advances and other
borrowings during the three-month period. 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 $310.9 million at June 30, 2004 and $285.2 million at
March 31, 2004, and generally mature within one to five years.

Stockholders' equity increased $6.2 million during the three months ended June
30, 2004 as a net result of (i) comprehensive income of $8.1 million, (ii) stock
options exercised of $900,000 (with the excess of the cost of treasury shares
over the option price ($590,000) charged to retained earnings), (iii) the
issuance of shares for management and benefit plans of $90,000, and (iv) benefit
plan shares earned and related tax adjustments totaling $180,000. These
increases were partially offset by cash dividends of $2.5 million.

                                       15
<PAGE>

ASSET QUALITY

Non-performing assets increased $1.7 million to $19.0 million at June 30, 2004
from $17.3 million March 31, 2004 and increased as a percentage of total assets
to 0.55% from 0.45% at such dates, respectively. Non-performing assets are
summarized as follows at the dates indicated:

<TABLE>
<CAPTION>
                                                                        AT MARCH 31,
                                                  AT JUNE 30,  -----------------------------
                                                      2004       2004      2003       2002
                                                  -----------  -------    -------    -------
                                                              (Dollars In Thousands)
<S>                                               <C>          <C>        <C>        <C>
Non-accrual loans:
 Single-family residential                          $ 3,862    $ 3,247    $ 4,510    $ 4,505
 Multi-family residential                                 -          -        444        187
 Commercial real estate                               8,298      8,764      1,776      2,212
 Construction and land                                    -          -          -        168
 Consumer                                               525        642        661        933
 Commercial business                                  5,636      2,268      2,678      1,037
                                                    -------    -------    -------    -------
  Total non-accrual loans                            18,321     14,921     10,069      9,042
Real estate held for development and sale                 -          -         49         74
Foreclosed properties and repossessed assets, net       688      2,422      1,535      1,475
                                                    -------    -------    -------    -------
  Total non-performing assets                       $19,009    $17,343    $11,653    $10,591
                                                    =======    =======    =======    =======

Performing troubled debt restructurings             $   140    $ 2,649    $ 2,590    $   403
                                                    =======    =======    =======    =======

Total non-accrual loans to total loans                 0.55%      0.45%      0.34%      0.32%
Total non-performing assets to total assets            0.50       0.46       0.33       0.30
Allowance for loan losses to total loans               0.85       0.87       1.00       1.09
Allowance for loan losses to total
 non-accrual loans                                   155.75     191.72     294.74     346.04
Allowance for loan and foreclosure losses
 to total non-performing assets                      150.60     165.78     257.87     300.05
</TABLE>

Non-accrual loans increased $3.4 million during the three months ended June 30,
2004. The increase was largely attributable to two commercial loans placed on
non-accrual status during the three-month period. One was a $5.2 million
commercial business loan secured by a computer software and consulting company
located in Tempe, Arizona. The other was a $960,000 loan secured by a 54 unit
motel located in Dodgeville, Wisconsin. At June 30, 2004, there were four
non-accrual commercial loans with loan balances greater than $1.0 million. One
loan is a commercial real estate loan which is secured by a 70 unit hotel
located in Kenosha, Wisconsin, with a loan balance of $3.1 million at June 30,
2004. Another loan is a commercial real estate loan which is secured by retail
property in Dallas, Texas, with a loan balance of $1.7 million at June 30, 2004.
Another loan is a commercial real estate loan which is secured by a 161 unit
motel located in Schiller Park, Illinois, with a loan balance of $1.5 million at
June 30, 2004. The other loan with a loan balance greater than $1.0 million is a
commercial business loan secured by the computer software and consulting company
discussed above. 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 more than 90 days.

Foreclosed properties and repossessed assets decreased $1.7 million for the
three months ended June 30, 2004. The decrease was not attributable to any one
specific loan. There were no foreclosed properties and repossessed assets with a
carrying value greater than $1.0 million at June 30, 2004.

                                       16
<PAGE>

Performing troubled debt restructurings decreased $2.5 million during the three
months ended June 30, 2004 primarily due to a $2.1 million commercial real
estate loan in Sonoma, California that was paid off during the quarter.

At June 30, 2004, assets that the Corporation had classified as substandard, net
of reserves, consisted of $22.1 million of loans and foreclosed properties. As
of March 31, 2004, substandard assets amounted to $31.1 million. An asset is
classified as substandard when it is determined that it is inadequately
protected by the current net worth and paying capacity of the obligor or by the
collateral pledged, if any, and that the Corporation will sustain some loss if
the deficiencies are not corrected. The decrease of $9.0 million in the
substandard balance for the three months ended June 30, 2004 was in part
attributable to the pay off of three previously classified loans which had
carrying values of greater than $1.0 million. The three loans were located in
Janesville, Wisconsin; Sonoma, California; and Minneapolis, Minnesota.

The category of substandard assets contains several loans with a carrying value
of greater than $1.0 million. One loan, with a carrying value of $3.9 million,
is secured by the assets of a stainless tank operation located in Cottage Grove,
Wisconsin. Two loans with a carrying value of $4.4 million, are secured by a
computer software and consulting company located in Tempe, Arizona. A third
loan, with a carrying value of $1.8 million, is secured by a 70 unit hotel
located in Kenosha, Wisconsin. A fourth loan, with a carrying value of $1.2
million, is secured by a commercial property located in Beloit, Wisconsin. A
fifth loan, with a carrying value of $1.0 million is secured by retail property
located in Dallas, Texas. A sixth loan, with a carrying value of $1.0 million,
is secured by a 161 unit motel located in Schiller Park, Illinois.

At June 30, 2004, the Corporation had identified assets of $12.5 million as
impaired, net of reserves. As of March 31, 2004, impaired loans were $11.7
million. A loan is defined as impaired when, according to FAS 114, based on
current information and events, it is probable that a creditor will be unable to
collect all amounts due according to the contractual terms of the loan
agreement. A summary of the details regarding impaired loans follows:

<TABLE>
<CAPTION>
                                           AT JUNE 30,           AT MARCH 31,
                                           -----------   ---------------------------
                                              2004        2004      2003       2002
                                           -----------   ---------------------------
                                                          (In Thousands)
<S>                                          <C>         <C>       <C>       <C>
Impaired loans with valuation
  reserve required                           $17,873     $17,126   $ 8,483   $11,467

Less:
  Specific valuation allowance                 5,376       5,382     3,717     4,240
                                             -------     -------   -------   -------

Total impaired loans                         $12,497     $11,744   $ 4,766   $ 7,227
                                             =======     =======   =======   =======
Average impaired loans                       $ 7,930     $ 6,389   $ 6,288   $ 6,216

Interest income recognized
  on impaired loans                          $    62     $   710   $   613   $   740

Interest income recognized on a cash basis
  on impaired loans                          $    62     $   710   $   613   $   740
</TABLE>

                                       17
<PAGE>

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 JUNE 30,    ---------------------------
                 2004         2004      2003      2002
              -----------    ---------------------------
                               (In Thousands)
<S>           <C>            <C>       <C>       <C>
30 to 59 days   $ 7,536      $ 4,887   $10,083   $17,647
60 to 89 days     3,757       10,941     5,612     2,671
                -------      -------   -------   -------
    Total       $11,293      $15,828   $15,695   $20,318
                =======      =======   =======   =======
</TABLE>

The Corporation's loan portfolio, foreclosed properties and repossessed assets
are evaluated on a continuing basis to determine the necessity for additions and
recaptures to the allowance for losses and the related adequacy of the balance
in the allowance for losses account. 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 losses. The
evaluation of the allowance for loan losses includes a review of known loan
problems as well as inherent 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.

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

<TABLE>
<CAPTION>
                                     THREE MONTHS ENDED
                                          JUNE 30,
                                   ---------------------
                                     2004        2003
                                   ---------------------
                                   (Dollars In Thousands)
<S>                                <C>          <C>
Allowance at beginning of period   $ 28,607     $ 29,677
Charge-offs:
  Mortgage                             (309)        (150)
  Consumer                             (274)        (217)
  Commercial business                    (5)         (73)
                                   --------     --------
     Total charge-offs                 (588)        (440)
Recoveries:
  Mortgage                                8          236
  Consumer                               22           28
  Commercial business                    36           86
                                   --------     --------
     Total recoveries                    66          350
                                   --------     --------
     Net charge-offs                   (522)         (90)
                                   --------     --------
Provision                               450          450
                                   --------     --------
Allowance at end of period         $ 28,535     $ 30,037
                                   ========     ========
Net charge-offs to
 average loans                        (0.07)%      (0.01)%
                                   ========     ========
</TABLE>

Although management believes that the June 30, 2004 allowance for loan losses is
adequate based upon the current evaluation of loan delinquencies, non-performing
assets, charge-off trends, economic conditions and other factors, there can be
no assurance that future adjustments to the allowance will not be necessary.
Management also continues to pursue all practical and legal methods of
collection, repossession and disposal, and adheres to high underwriting
standards in the origination process in order to continue to maintain strong
asset quality.

                                       18
<PAGE>

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 securities, deposits from retail and wholesale
sources, advances and other borrowings.

At June 30, 2004, the Corporation had outstanding commitments to originate loans
of $162.1 million, commitments to extend funds to, or on behalf of, customers
pursuant to lines and letters of credit of $271.3 million and loans sold with
recourse to the Corporation in the event of default by the borrower of $268,000.
The Corporation had sold loans with recourse in the amount of $11.7 million
through the FHLB Mortgage Partnership Finance Program at June 30, 2004.
Scheduled maturities of certificates of deposit during the twelve months
following June 30, 2004 amounted to $982.5 million and scheduled maturities of
FHLB advances during the same period totaled $151.1 million. At June 30, 2004,
the Corporation had no reverse repurchase agreements. Management believes
adequate resources are available to fund all commitments to the extent required.

The Bank is required by the Office of Thrift Supervision ("OTS") to maintain
liquid investments in qualifying types of U.S. Government and agency securities
and other investments sufficient to ensure its safe and sound operation. During
the quarter ended June 30, 2004, the Bank's average liquidity ratio was 9.94%.

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.

                                       19
<PAGE>

The following summarizes the Bank's capital levels and ratios and the levels and
ratios required by the OTS at June 30, 2004 and March 31, 2004:

<TABLE>
<CAPTION>
                                                                          MINIMUM REQUIRED
                                                       MINIMUM REQUIRED      TO BE WELL
                                                         FOR CAPITAL      CAPITALIZED UNDER
                                         ACTUAL       ADEQUACY PURPOSES   OTS REQUIREMENTS
                                   --------------------------------------------------------
                                     AMOUNT   RATIO     AMOUNT    RATIO    AMOUNT    RATIO
                                   --------------------------------------------------------
                                                     (Dollars In Thousands)
<S>                                <C>        <C>     <C>         <C>     <C>        <C>
AS OF JUNE 30, 2004:
Tier 1 capital
  (to adjusted tangible assets)    $ 297,381   7.91%  $ 112,733    3.00%  $ 187,889    5.00%
Risk-based capital
  (to risk-based assets)             320,547  10.78     237,820    8.00     297,275   10.00
Tangible capital
  (to tangible assets)               297,381   7.91      56,367    1.50      N/A       N/A

AS OF MARCH 31, 2004:
Tier 1 capital
  (to adjusted tangible assets)    $ 285,680   7.71%  $ 111,208    3.00%  $ 185,346    5.00%
Risk-based capital
  (to risk-based assets)             308,912  10.61     232,858    8.00     291,073   10.00
Tangible capital
  (to tangible assets)               285,680   7.71      55,604    1.50      N/A       N/A
</TABLE>

The following table reconciles the Corporation's stockholders' equity to
regulatory capital at June 30, 2004 and March 31, 2004:

<TABLE>
<CAPTION>
                                                           JUNE 30,    MARCH 31,
                                                          ----------------------
                                                            2004         2004
                                                          ----------------------
                                                              (In Thousands)
<S>                                                       <C>          <C>
Stockholders' equity of the Corporation                   $ 307,715    $ 301,548
Less: Capitalization of the Corporation and non-bank
  subsidiaries                                               10,265        8,674
                                                          ---------    ---------
Stockholders' equity of the Bank                            317,980      310,222
Less: Intangible assets and other non-includable assets     (20,599)     (24,542)
                                                          ---------    ---------
Tier 1 and tangible capital                                 297,381      285,680
Plus: Allowable general valuation allowances                 23,166       23,232
                                                          ---------    ---------
Risk based capital                                        $ 320,547    $ 308,912
                                                          =========    =========
</TABLE>

                                       20
<PAGE>

GUARANTEES

Financial Interpretation No. 45 "Guarantor's Accounting and Disclosure
Requirements for Guarantees, Including Indirect Guarantees of Indebtedness to
Others" ("FIN 45") requires certain guarantees to be recorded at fair value as a
liability at inception and when a loss is probable and reasonably estimatable,
as those terms are defined in FASB Statement No. 5 "Accounting for
Contingencies." The recording of the liability has not significantly affected
the Corporation's financial condition.

The Corporation's real estate investment segment, IDI, is required to guaranty
the partnership loans of its subsidiaries, for the development of homes for
sale. As of June 30, 2004, IDI had guaranteed $71.9 million for the following
partnerships on behalf of the respective subsidiaries. As of the same date,
$21.6 million was outstanding. The table below summarizes the individual
subsidiaries and their respective guarantees and outstanding loan balances.

<TABLE>
<CAPTION>
                                                    AMOUNT       AMOUNT
SUBSIDIARY        PARTNERSHIP           AMOUNT    OUTSTANDING  OUTSTANDING
  OF IDI             ENTITY           GUARANTEED   AT 6/30/04   AT 3/31/04
----------  ------------------------  ----------  -----------  -----------
                              (Dollars in thousands)
<S>         <C>                       <C>         <C>          <C>
 Oakmont         Chandler Creek       $    8,440  $     6,621  $     7,340

Davsha II           Paragon                5,100        3,132        3,130

Davsha III   Indian Palms 147, LLC         8,500        1,381        1,650

Davsha IV     DH Indian Palms, LLC        20,070        1,853        3,330

 Davsha V    Villa Santa Rosa, LLC        12,500        3,994        5,490

Davsha VI      Bellasara 168, LLC         12,740        2,476        4,700

Davsha VII  La Vista Grande 121, LLC       4,500        2,111            -
                                      ----------  -----------  -----------
  Total                               $   71,850  $    21,568  $    25,640
                                      ==========  ===========  ===========
</TABLE>

IDI has real estate partnership investments within its subsidiaries for which it
guarantees the above loans. These partnerships are also funded by financing with
loans guaranteed by IDI and secured by the lots and homes being developed within
each of the respective partnership entities.

As a limited partner, the Corporation still has the ability to exercise
significant influence over operating and financial policies. This influence is
evident in the terms of the respective partnership agreements and participation
in policy-making processes. The Corporation has a 50% controlling interest in
the respective limited partnerships and therefore has significant influence over
the right to approve the sale or refinancing of assets of the respective
partnerships in accordance with those partnership agreements.

In acting as a partner with a controlling interest, the Corporation is committed
to providing additional levels of funding to meet partnership operating deficits
up to an aggregate amount of $71.9 million. At June 30, 2004, the Corporation's
investment in these partnerships consisted of assets of $49.6 million and cash
and other assets of $3.3 million. The liabilities of these partnerships
consisted of other borrowings of $38.0 million (reported as a part of FHLB and
other borrowings), other liabilities of $4.0 million (reported as a part of
other liabilities) and minority interest of $6.3 million. These amounts
represent the Corporation's maximum exposure to loss at June 30, 2004 as a
result of involvement with these limited partnerships.

                                       21
<PAGE>

The partnership agreements generally contain buy-sell provisions whereby certain
partners can require the purchase or sale of ownership interests by certain
partners.

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 Corporation's cumulative net gap
position at June 30, 2004 has not changed materially since March 31, 2004.

                                       22
<PAGE>

SEGMENT REPORTING

According to the materiality thresholds of SFAS No. 131, the Corporation is
required to report each operating segment based on materiality thresholds of ten
percent or more of certain amounts, such as revenue. Additionally, the
Corporation is required to report separate operating segments until the revenue
attributable to such segments is at least 75 percent of total consolidated
revenue. SFAS No. 131 allows the Corporation to combine operating segments, even
though they may be individually material, if the segments have similar basic
characteristics in the nature of the products, production processes, and type or
class of customer for products or services. Based on the above criteria, the
Corporation has two reportable segments.

COMMUNITY BANKING: This segment is the main basis of operation for the
Corporation and includes the branch network and other deposit support services;
origination, sales and servicing of one-to-four family loans; origination of
multifamily, commercial real estate and business loans; origination of a variety
of consumer loans; and sales of alternative financial investments such as tax
deferred annuities.

REAL ESTATE INVESTMENTS: The Corporation's non-banking subsidiary, IDI, and its
subsidiary, NIDI, invest in limited partnerships in real estate developments.
Such developments include recreational residential developments and industrial
developments (such as office parks).

The following represents reconciliations of reportable segment revenues, profit
or loss, and assets to the Corporation's consolidated totals for the three
months ended June 30, 2004 and 2003, respectively.

                                       23
<PAGE>

<TABLE>
<CAPTION>
                                                                      THREE MONTHS ENDED JUNE 30, 2004
                                                        ------------------------------------------------------------
                                                                                                        CONSOLIDATED
                                                        REAL ESTATE      COMMUNITY      INTERSEGMENT     FINANCIAL
                                                        INVESTMENTS       BANKING       ELIMINATIONS     STATEMENTS
                                                        ------------    ------------    ------------    ------------
<S>                                                     <C>             <C>             <C>             <C>
Interest income                                         $        130    $     46,960    $        (54)   $     47,036
Interest expense                                                 138          18,746             (54)         18,830
                                                        ------------    ------------    ------------    ------------
  Net interest income (loss)                                      (8)         28,214               -          28,206
Provision for loan losses                                          -             450               -             450
                                                        ------------    ------------    ------------    ------------
  Net interest income (loss) after provision
     for loan losses                                              (8)         27,764               -          27,756
Real estate investment partnership revenue                    23,967               -               -          23,967
Other revenue from real estate operations                        907               -               -             907
Other income                                                       -           5,389               -           5,389
Real estate investment partnership cost of sales             (19,819)              -               -         (19,819)
Other expense from real estate partnership operations         (2,714)              -               -          (2,714)
Minority interest in income of real estate
  partnerships                                                (1,582)              -               -          (1,582)
Other expense                                                      -         (17,895)              -         (17,895)
                                                        ------------    ------------    ------------    ------------
  Income before income taxes                                     751          15,258               -          16,009
Income tax expense                                               205           5,207               -           5,412
                                                        ------------    ------------    ------------    ------------
  Net income                                            $        546    $     10,051    $          -    $     10,597
                                                        ============    ============    ============    ============

Total Assets                                            $     70,003    $  3,769,650    $          -    $  3,839,653
</TABLE>

<TABLE>
<CAPTION>
                                                                    THREE MONTHS ENDED JUNE 30, 2003
                                                        --------------------------------------------------------
                                                                                                    CONSOLIDATED
                                                        REAL ESTATE     COMMUNITY    INTERSEGMENT    FINANCIAL
                                                        INVESTMENTS      BANKING     ELIMINATIONS    STATEMENTS
                                                        ------------   ------------  ------------   ------------
<S>                                                     <C>            <C>           <C>            <C>
Interest income                                         $         22   $     49,042  $        (22)  $     49,042
Interest expense                                                  32         20,582           (32)        20,582
                                                        ------------   ------------  ------------   ------------
  Net interest income (loss)                                     (10)        28,460            10         28,460
Provision for loan losses                                          -            450             -            450
                                                        ------------   ------------  ------------   ------------
  Net interest income (loss) after provision
   for loan losses                                               (10)        28,010            10         28,010
Other income                                                   3,512         12,427        (2,874)        13,065
Other expense                                                  2,864         18,150        (2,864)        18,150
                                                        ------------   ------------  ------------   ------------
  Income before income taxes                                     638         22,287             -         22,925
Income tax expense                                               265          8,567             -          8,832
                                                        ------------   ------------  ------------   ------------
  Net income                                            $        373   $     13,720  $          -   $     14,093
                                                        ============   ============  ============   ============

Total assets                                            $     41,974   $  3,580,451  $          -   $  3,622,425
</TABLE>

                                       24

<PAGE>

ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

          The Corporation's market rate risk has not materially changed from
          March 31, 2004. See the Corporation's Annual Report on Form 10-K for
          the year ended March 31, 2004.

ITEM 4 CONTROLS AND PROCEDURES

          The management of the Corporation evaluated, with the participation of
          the Chief Executive Officer and Chief Financial Officer, the
          effectiveness of the Corporation's disclosure controls and procedures
          (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities
          Exchange Act of 1934) as of the end of the period covered by this
          report. Based on such evaluation, the Chief Executive Officer and
          Chief Financial Officer have concluded that the Corporation's
          disclosure controls and procedures are designed to ensure that
          information required to be disclosed in the reports that are filed or
          submitted under the Securities Exchange Act of 1934 is recorded,
          processed, summarized and reported within the time periods specified
          in the SEC's rules and regulations and are operating in an effective
          manner.

          No change in the Corporation's internal control over financial
          reporting (as defined in Rules 13a-15(f) and 15(d)-15(f) under the
          Securities Exchange Act of 1934) occurred during the most recent
          fiscal quarter that has materially affected, or is reasonably likely
          to materially affect, the Corporation's internal control over
          financial reporting.

                           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.

                                       25

<PAGE>

ITEM 2 CHANGES IN SECURITIES, USE OF PROCEEDS AND ISSUER PURCHASES OF EQUITY
       SECURITIES.

          (a) - (d) Not applicable.

          (e) The following table sets forth information with respect to any
          purchase made by or on behalf of the Corporation or any "affiliated
          purchaser," as defined in Section 240.10b-18(a)(3) under the Exchange
          Act, of shares of the Corporation's Common Stock during the indicated
          periods.

<TABLE>
<CAPTION>
                                                                      TOTAL NUMBER OF
                                                                    SHARES PURCHASED AS            MAXIMUM NUMBER OF
                             TOTAL NUMBER          AVERAGE            PART OF PUBLICLY           SHARES THAT MAY YET BE
                               OF SHARES          PRICE PAID         ANNOUNCED PLANS OR           PURCHASED UNDER THE
     PERIOD                    PURCHASED          PER SHARE               PROGRAMS               PLANS OR PROGRAMS (1)
------------------           ------------         ----------        -------------------          ----------------------
<S>                          <C>                  <C>               <C>                          <C>
April 1 - 30, 2004                  -               $     -                    -                         960,650

May 1 - 31, 2004                    -                     -                    -                         960,650

June 1 - 30, 2004                   -                     -                    -                         960,650
                                  ---               -------                 ----                         -------

         Total                      -               $     -                    -                         960,650
                                  ===               =======                 ====                         =======
</TABLE>

     (1)  On October 28, 2003, the Corporation announced a program to repurchase
          up to 1.2 million shares of the Corporation's Common Stock. This
          repurchase plan expires October 28, 2004.

ITEM 3 DEFAULTS UPON SENIOR SECURITIES.

          Not applicable.

ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

          The Annual Meeting of Stockholders was held on July 27, 2004. There
          were 22,983,200 shares of common stock that could be voted, and
          19,768,317 shares present at the meeting by holders thereof in person
          or by proxy which constituted a quorum. The following is a summary of
          the results of items voted upon.

<TABLE>
<CAPTION>
                                                                           NUMBER OF VOTES
                                                         ---------------------------------------------------
                                                           FOR                                     WITHHELD
                                                         ----------                                ---------
<S>                                                      <C>                                       <C>
Election of Directors for three-year terms expiring
   in 2007:
      Greg M. Larson                                     17,408,737                                2,359,580
      Douglas J. Timmerman                               17,137,309                                2,631,008
      David L. Omachinski                                17,248,623                                2,519,694
      Pat Richter                                        17,291,532                                2,476,785
</TABLE>

<TABLE>
<CAPTION>
                                                                                                   ABSTAINED/
                                                                                                    BROKER
                                                           FOR                AGAINST              NON-VOTES
                                                         ----------          ---------             ---------
<S>                                                      <C>                 <C>                   <C>
Proposal to adopt the 2004 Equity Incentive Plan         14,702,040          1,928,414             3,137,863
</TABLE>

<TABLE>
<CAPTION>
                                                            FOR                AGAINST             ABSTAINED
                                                         ----------            -------             ---------
<S>                                                      <C>                   <C>                 <C>
Appointment of Ernst & Young LLP as independent
    auditor for the year ending March 31, 2005
                                                         19,180,762            483,689             103,866
</TABLE>

                                       26

<PAGE>

ITEM 5 OTHER INFORMATION.

          AnchorBank settled with the Wisconsin Department of Revenue as regards
          the taxation of its Nevada investment subsidiary. For additional
          information, see Note 6 to the Unaudited Consolidated Financial
          Statements.

ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K.

     (a)  EXHIBITS.

          Exhibit 31.1   Certification of Chief Executive Officer Pursuant to
                         Rules 13a-14 and 15d-14 of the Securities Exchange Act
                         of 1934 and Section 302 of the Sarbanes-Oxley Act of
                         2002 is included herein as an exhibit to this Report.

          Exhibit 31.2   Certification of Chief Financial Officer Pursuant to
                         Rules 13a-14 and 15d-14 of the Securities Exchange Act
                         of 1934 and Section 302 of the Sarbanes-Oxley Act of
                         2002 is included as an exhibit to this Report.

          Exhibit 32.1   Certification of the Chief Executive Officer pursuant
                         to Section 906 of the Sarbanes-Oxley Act of 2002 (18
                         U.S.C. 1350) is included herein as an exhibit to this
                         Report.

          Exhibit 32.2   Certification of the Chief Financial Officer pursuant
                         to Section 906 of the Sarbanes-Oxley Act of 2002 (18
                         U.S.C. 1350) is included herein as an exhibit to this
                         Report.

     (b)  REPORTS ON FORM 8-K.

          The Corporation filed a Current Report on Form 8-K on May 3, 2004
          under Items 7 and 12 to furnish the Corporation's earnings release for
          the quarter ended March 31, 2004.

                                       27

<PAGE>

                                   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: August 5, 2004                     By: /s/ Douglas J. Timmerman
                                             -----------------------------------
                                             Douglas J. Timmerman, Chairman of
                                             the Board, President and Chief
                                             Executive Officer

Date: August 5, 2004                     By: /s/ Michael W. Helser
                                             -----------------------------------
                                             Michael W. Helser, Treasurer and
                                             Chief Financial Officer

                                       28